Broker profitability rises as growth slows

The UK broking sector has continued to perform strongly, building on recent momentum and proving its ability to adapt and thrive in a constantly shifting landscape.

That is according to the results of the Insurance DataLab Broker Performance Report 2025, due to be released at this year’s Biba Conference on 14 and 15 May – with Insurance Times having exclusive early sight of the findings.

Now in its fourth year, the report’s results for 2025 offer a nuanced picture, based on Insurance DataLab’s proprietary broker rating system.

Factored into these percentage scores is brokers’ profitability via its three-year earnings before interest, taxes, depreciation and amortisation (ebitda) margin, growth in terms of revenue and operating profit, as well as productivity, described as turnover per employee and staff costs as a percentage of turnover.

The average broker rating for 2025 is 53.3% – slightly down from last year’s record high of 53.7%, but still comfortably ahead of 2023’s recorded 52.5%.

This slight dip in overall rating comes amid a softening market and growing costs of compliance, which are likely dampening some of brokers’ momentum seen in previous years.

Yet the headline figures still reflect a resilient sector that continues to perform strongly across the three key pillars of profitability, growth and productivity.

Growth was the only pillar to worsen in 2025, dropping by two percentage points to 52.6%. This comes after a strong showing in 2024, where brokers posted their highest ever growth rating of 54.6%.

The softening of market conditions in recent years is likely to blame for this. After several years of rising premiums during the harder market, which helped to fuel broker commission levels, rates have started to fall.

This has led to a slowdown in revenue growth, with the aggregate revenue across Insurance DataLab’s latest cohort of companies growing by 11.1%, according to the latest set of available financial accounts. This is down from revenue growth of 14.1% in the previous year.

Meanwhile, after two years of steady improvement, productivity growth has all but stalled this year, with brokers’ average productivity rating edging up just 0.1 percentage point to 51.9%.

This improvement was driven by a 1.5% increase in turnover per employee to more than £157,000, continuing the positive trend that has been seen for this metric in recent years – albeit at a slower rate.

This was, however, offset by a 1.3 percentage point rise in staff costs as a percentage of turnover, which now stands at 46.8% – the highest level since Insurance DataLab started this analysis four years ago.

 

Insurance DataLab co-founder Dan King said: “The rising staff costs seen in the broking market is evidence of the ongoing war for talent that continues to dog the industry, as well as the impact the cost of living crisis is having on wage inflation.

“This is being exacerbated by the increasing regulatory burden brokers find themselves under, which is demanding even greater resource commitments and driving costs up further.”

King noted that this drain on productivity could also apply the brakes on further growth in the sector unless action is taken to address the issue.

He continued: “The increased workload brokers face in the wake of Consumer Duty is acting as a drain on precious resources – something that is disproportionately affecting smaller brokers.

“Brokers that embed smart compliance practices and make better use of data are more likely to stay ahead of the curve. It’s about working smarter, not just harder – especially when every resource counts.”

In contrast, profitability continues to go from strength to strength, with brokers’ average profitability rating climbing to a record high of 54.6% – up from 54.5% last year.

This uptick in performance was supported by a 14.5% increase in the aggregate ebitda across this year’s cohort of brokers – this now stands at more than £3bn.

Somerset Bridge succeeds

As well as analysing performance across the general insurance broking market, the Insurance DataLab Broker Performance Report 2025 also identifies the top performing firms – the highest scorers are awarded an Insurance DataLab gold award.

This year, the market intelligence firm has recognised 10 firms with this coveted accolade – the full list will be revealed at the Biba Conference 2025. Print copies of the final report will be available on the Insurance Times stand (A40).

As a sneak preview, however, Somerset Bridge Insurance Services sits at the top of the pile this year to claim its first gold award, with an overall performance rating of 79%.

It was additionally the most improved broker across 2025’s cohort, recording a 29.6 percentage point increase in its score after achieving a rating of 49.4% in 2024.

This improvement was driven by a market-leading rating for both productivity and growth, with scores of 95% and 91.7% respectively.

The broker’s productivity was underpinned by a low staff cost base relative to revenue, with staff costs accounting for just 7.5% of revenue – compared to a market average of 46.8%.

Turnover per employee, meanwhile, stood at almost £784,000 versus a market average of a little over £157,000.

Somerset Bridge Insurance Services also bettered its revenue year-on-year, reporting £85.4m in its latest financial accounts – more than double the £38.5m recorded a year earlier.

Its operating profit grew to £34.4m too – up from just £2.7m the previous year.

Although profitability was the weakest metric for the broker in 2025’s Insurance DataLab ranking, Somerset Bridge Insurance Services still posted a 58.3% rating – up 16.7 points year-on-year and above the market average of 54.6%.

A much improved ebitda margin in its latest set of accounts, however, indicates that the broker is set for an enhanced performance under this measure across future years, as the current three-year ebitda margin also incorporates lower results from previous years.

 

Second place for RAC

The second placed broker for 2025 is a serial award winner – RAC Financial Services.

The business rose from 10th spot last year after it achieved a 10.2 percentage point improvement in its overall rating – this makes it the highest ranked broker in this analysis with revenue between £100m and £500m.

RAC Financial Services achieved a performance rating of 78% for 2025, up from 67.8% in 2024. This means that the broker has now won a gold award in each of the last four years.

The broker’s performance was underpinned by a strong showing across both the productivity (94%) and profitability (89.1%) metrics. Indeed, RAC Financial Services was the third highest rated business for profitability.

Meanwhile, the broker reported a three-year aggregate ebitda margin of 54.1% in its latest set of accounts, up from 47.1%, after its 2023/24 ebitda rose to almost £119m.

RAC Financial Services’ average turnover per employee has also been on the rise, standing at almost £489,000 – an increase of 16.7% compared to the previous year.

The broker also managed to improve its staff costs relative to turnover, with this metric falling by 0.8 percentage points to just 9.9%.

The broker’s overall score was dampened by its growth rating, however, which stood at 58.9% for 2025. But it is worth noting that this is still 6.3 percentage points above the market average and a 15.4 percentage point increase on the broker’s rating in 2024.

RAC Financial Services achieved an 11.9% rise in revenue to £191.9m, according to Insurance DataLab’s exclusive analysis, underlining strong year-on-year progress.

Operating profit also reported strong growth in the broker’s latest financial results, increasing by more than £28m to £88.9m – this is more than double the operating profit reported four years earlier.

 

Bronze for JCB

Rounding off the top three brokers in UK general insurance is another four time award winner – JCB Insurance Services.

The broker achieved an overall rating of 74% to once again finish in third place, following a 2.8 percentage point improvement in its score. This makes it the top rated broker with revenue of less than £10m.

The broker was the joint top rated broker for profitability, with a 95% rating driven by a three-year ebitda margin of 65.6% – the highest in this analysis for the second consecutive year.

JCB Insurance Services also performed strongly across the other two pillars underpinning this analysis, with scores of 57.3% and 65.5% for growth and productivity respectively.

It reported revenue growth of 20.7% in its latest accounts, while operating profit grew by more than £850,000 to £4.4m.

The broker’s productivity rating, meanwhile, was underpinned by an average turnover per employee in excess of £213,000 and staff costs equal to just 23% of turnover.

 

A healthy marketplace

While this year’s results from Insurance DataLab’s annual report may not have matched 2024’s record-breaking highs, they still paint a picture of a healthy and competitive broking sector – with some especially impressive standout performances.

There are signs that the soft market may be coming to a close, while the FCA has also started talks to reduce the compliance burden on firms – two factors that should ease the pressure on brokers and release the brakes that have hampered performance over the last 12 months.