Aon plc (NYSE:AON) Q2 2023 Earnings Call Transcript

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Greg Case: Listen, we — as we’ve described, we feel very good about the progress back to kind of the overall Aon United strategy, the core fundamentals as you highlighted well geographically very strong. Even in North America, retention very good, new business is very good. Core P&C exceptional. We just have a wonderful strong business, our capability in an area of M&A services, which, by the way, we’re feeling now, but we embrace completely because as the market comes back, as Eric described, we benefit from that as well. But the fundamentals, the track is everything we’ve described around literally winning more clients and been doing more with them, and keeping them longer for all the reasons that we talked about around our overall and strategy. So we’re feeling very, very good about trajectory and momentum, recognizing there are market conditions out there, but good about that overall. Eric, what else would you add to that perspective?

Eric Andersen: Yes. Maybe the only other angle I would say, Greg, is the sophistication of the products that are entering into places like Asia-Pacific and Latin America continue to evolve as the clients evolve. So whether it’s risk financing techniques, whether a specialty products, whether it’s the international as those organizations expand outside their home countries. So as those economies continue to develop, whether it’s India, whether it’s other parts of Asia, we’re able to grow with them and help them as they need more sophisticated products. So we are very excited about the platforms that we have in Latin America and Asia-Pacific, and we do see good growth opportunities over the long term.

Greg Case: One other point on that, Bob, just to sort of make it. I was in Singapore with Christa a month ago, opening our global climate hub, phenomenal. And we had the opportunity to go around and see so many different clients in that perspective. It really reflected exactly what Eric is describing. Their needs becoming more global and more interconnected. They want to see global Aon put it in their backyard. That was a very, very positive sort of overall kind of finding as such as we’re standing and thinking about that. It really does bode well to what the opportunities are. And then if you take that in some of Eric’s other comments around risk capital and what it really means, bringing reinsurance analytics into the commercial space in an effective way, also something that was very, very positive. So just a specific example in a region, as you highlighted, where we have a particular opportunity. The same is true in Latin America.

Operator: Our next question comes from the line of Rob Cox with Goldman Sachs. Please proceed with your question.

Rob Cox: So in reinsurance solutions, really strong results obviously, but I would have thought you would see more acceleration or a sequential acceleration given the Aon Benfield exposure to property cat in the U.S. Can you provide some color there? And then — also on the prospects for growth in the back half of the year in reinsurance, as we’ve seen some news articles regarding kind of an above-average chunk of the facultative business being hired by a competitor.

Eric Andersen: Sure. Greg, let me take that one. So on the first half, listen, we are really proud, excited whatever word we can use on our reinsurance capabilities, really great first half, great second quarter, a great first half coming off of a couple of great years. Just remember that most of the treaty business happens in the first half, and so a lot of that is now finished. But I would say that as clients have been dealing with the changing reinsurance market, they’ve made their own decisions. Sometimes they don’t buy certain layers, sometimes they buy less, sometimes they buy differently. And so that’s always a decision that we help our clients make as they think through how they want to use reinsurance capital for their business.

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