Cost of Howden-Driven Talent War Rises to $31M for Brown & Brown

Brown & Brown acknowledges that the cost of the Howden-driven talent war has risen to $31 million in annual revenue.

“At the end of March, the startup [Howden] has taken customers representing approximately $31 million of annual revenue as compared to the $23 million we announced last quarter,” according to R. Andrew Watts, Brown & Brown’s chief financial officer and treasurer. Watts and the broker’s CEO J. Powell Brown spoke during a recent analysts’ call to discuss Q1 2026 results.

Watts said the $31 million revenue hit includes $10 million from the first quarter alone.

Brown & Brown, headquartered in Daytona Beach, Florida, previously had revealed that 275 of B&B’s former teammates joined Howden’s U.S. start-up – a figure that is expected to rise this year. (See related B&B article on the talent war).

Watts noted that a judge in Massachusetts had issued a temporary restraining order in December with tight restrictions, so not much could be discussed about the legal case, nor the outlook.

Softening Property Cat Rates

During its Q1 2026 analysts’ call on April 28, Watts and Brown discussed the impact of property catastrophe rates on the company’s results as well as its strategy for artificial intelligence (AI).

Q1 revenues were $1.9 billion, an increase of $497 million, or 35.4%, compared to the first quarter of the prior year.

Organic revenue was flat but grew by 2.2% when including contingent commissions.

Retail delivered organic growth, including contingent commissions, of 1.3%, and organic growth excluding contingents of 1%. For Specialty Distribution, Q1 organic revenue, including contingents, increased by 3.9% and decreased by 2% when excluding contingents.

Net income attributable to the company was $426 million, increasing $95 million, or 28.7%, compared to the first quarter of 2025.

Brown attributed much of its flat organic revenue to continued pressure on property catastrophe rates.

“From a commercial insurance standpoint, the changes in rates remained relatively consistent with prior quarters except for CAT property, which declined further than in the fourth quarter of last year,” Brown added.

Brown said the company isn’t surprised that property is under pressure. “We have been surprised at the decrease and the amount of decrease that has occurred.”

Diving into the overall rate environment, Brown said, the admitted property/casualty markets continue to be in the range of flat to up 5% versus prior year.

“Workers’ comp rates remained flat to down 3%, while we saw a few states increase rates modestly. For non-CAT property overall, rates remained down 5% to up 5%, depending on the loss experience and the location,” he said.

“For casualty lines, rates increased 2% to 5% for primary layers, with excess layers increasing materially more. For professional liability, rates remained similar to the last couple quarters and were down 5% to up 5%,” Brown continued.

Shifting to the excess and surplus lines (E&S) market, he split his analysis between property and casualty. For property, both wind and quake rates dropped, but rate declines were modestly more than experienced in Q4 of last year with most placements for the quarter down 15% to 35%, Brown said. “At the end of the quarter, we saw placements above and below this range. Generally, customers are capturing most of the savings.”

He noted that some customers are using the savings to decrease deductibles, increase limits or buy other lines of coverage, which are common tactics when rates are moderating or declining.

“On the casualty front, not much has changed versus prior quarters. The ability to get higher limits is extremely challenging. Pricing continued to increase. Primary layers are becoming more expensive, and carriers are decreasing the limits they’ll offer. We do not expect this trend to change materially over the coming quarters,” Brown explained.

Florida Property Cat Rates Soften

Brown cited the example of the Florida market, which is seeing rates in coastal property that are similar to those seen in 2016 and 2017, before the market began hardening in 2018 or 2019.

After property cat rates rose over a five-or-six-year period, it has managed to reduce all those gains over the past two years, he added.

In addition, the impact of substantial price decreases is not limited to Florida, he said, pointing to other catastrophe-prone inland areas such as those affected by severe convective storms.

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