PE Perspective on Insurance Brokers - [Business Breakdowns, EP.225]

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Aug 7, 2025

Aaron Cohen, Managing Director at GTCR, dives into the intricacies of the insurance brokerage industry. He discusses GTCR's impressive journey in building Assured Partners and highlights the importance of leadership in investment decisions. Cohen explores the evolving landscape driven by technology, potential risks like cyber threats, and how specialization improves customer retention. With insights on market dynamics and the appeal of private equity investing, this conversation is packed with valuable lessons for aspiring investors and industry professionals.

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INSIGHT

CEO is Key Investment Factor

GTCR prioritizes the CEO as their most important investment decision factor.
Great leaders must be proven moneymakers who have created real shareholder value before.

INSIGHT

CEO Fit Varies by Industry and Size

Great CEOs excel best within their known industries and specific business sizes.
CEOs comfortable at one company size or industry may not adapt successfully to others.

INSIGHT

Insurance Brokerage Fundamentals

Insurance brokerage is less cyclical and very capital-light, yielding strong cash flow after EBITDA.
Fragmentation prompts M&A as a key growth and value creation driver in the industry.

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This is Matt Reustle. Today's Breakdown caters to both public and private investors alike. My guest is Aaron Cohen, head of the Financial Services and Technology Group at GTCR, and our topic is insurance Brokers. I was initially intrigued by Aaron and GTCR after seeing their announced $13 billion sale of Assured Partners to Arthur J.Gallagher, an incredible success story in the insurance brokerage space that we covered in a previous breakdown.

But, what I failed to appreciate, and you'll hear Aaron politely correct me in the episode, is that not only did GTCR own Assured through two separate periods, they actually built the business with CEO Jim Henderson from the ground up.

We cover GTCR's approach to scaling businesses, the nuances of their leadership strategy, and why this space is so attractive to the PE market. Please enjoy this Breakdown on the insurance brokerage space.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page⁠⁠⁠⁠ ⁠here⁠⁠⁠⁠⁠.

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Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit⁠⁠⁠⁠⁠ joincolossus.com/episodes⁠⁠⁠⁠⁠.

Editing and post-production work for this episode was provided by The Podcast Consultant (⁠⁠⁠⁠⁠https://thepodcastconsultant.com⁠⁠⁠⁠⁠).

Show Notes

(00:00:00) Welccome to Business Breakdowns

(00:03:34) GTCR's Investment Strategy

(00:05:31) Importance of Leadership in Investments

(00:10:04) Insurance Brokerage Industry Insights

(00:12:52) Changes and Trends in Insurance Brokerage

(00:27:49) Role of Technology in Insurance

(00:31:25) The Challenges of System Integration

(00:32:52) Revenue Growth in the Insurance Industry

(00:33:39) The Impact of Social Inflation

(00:34:25) Emerging Risks and Cybersecurity

(00:35:12) Insurance Brokers and Revenue Models

(00:40:45) Financial Metrics and EBITDA Margins

(00:42:58) Private Equity and Insurance Brokerage

(00:45:49) The Assured Partners Story

(00:54:16) Risks and Market Cycles in Insurance

(00:57:35) Regulation and Industry Stability

(00:58:49) Lessons From This Industry