Lockton Companies: Everything you need to know
|444 W. 47th Street, Suite 900 Lockton Benefits, Suite 600 Kansas City, Missouri 64112, United States|
|Global revenue||$3.1 billion|
|Expertise||Corporate risks; people solutions; reinsurance, consultancy & schemes; specialist insurance|
|Key people||Ron Lockton (executive chairman), David Lockton (lead director), Peter Clune (CEO), Neil Nimmo (chairman)|
About Lockton Companies
Lockton Companies Inc. (Lockton) is the largest privately held, independent insurance brokerage firm in the world. The Kansas City, US-headquartered firm provides insurance, risk management, employee benefits and retirement services from more than 140 locations in 30 countries around the world. It currently employs more than 10,750 associates and serves clients in more than 100 countries worldwide.
The independent brokerage giant has been the company to beat in recent years. In the latest fiscal year, Lockton posted record global revenue of US$3.1 billion, marking its 56th consecutive year of revenue growth. This result was a 17% increase from its revenue recorded the year prior.
A brief history
Lockton was founded in Kansas City, Missouri, by Jack Lockton in 1966. He was only 24 years old at the time and had recently graduated from the University of Missouri Kansas City with a degree in Economics. After university, he worked as an underwriter for a surety bonding company for just over a year, before persuading his parents to partner with him in order to set up Lockton as a company. The young entrepreneur had a lot of support early on, with some big industry names backing him. In 1979, the firm opened its second office in Denver, Colorado, and since then Lockton’s model has been about finding business leaders around the US and later around the world, recruiting them, and building offices around them.
Services and products
There’s a lot to choose from at Lockton. Under its risk management and insurance arm, the firm offers a holistic suite of property & casualty (P&C) solutions. It also offers a full range of services including: analytics, catastrophe response, claims consulting, global client services, mergers & acquisition services, risk control, risk finance, and strategic risk consulting.
As the world becomes increasingly interconnected and international trade becomes the norm, the global risk landscape is growing in complexity. As such, Lockton Global has positioned itself as a global risk management partner of choice. The unit, which is a legal partnership of independent brokers, serves clients in more than 100 countries worldwide with integrated solutions in risk management, insurance, and employee benefits.
Entering the reinsurance business
In March 2019, Lockton announced the formation of Lockton Global Re, a new global reinsurance business. This was a major build-out of Lockton’s reinsurance capabilities, and it incorporated Lockton’s London-based specialty team into the global unit. Lockton tapped three of the best reinsurance brains from rival reinsurer Guy Carpenter to lead the team: Tim Gardner, former CEO of North America operations for Guy Carpenter; Claude Yoder, former managing director and global chief innovation and product development officer for Guy Carpenter; and Nick Durant, former managing director for Guy Carpenter.
“As a major global retail broker, we always saw the opportunity in building complimentary talent in reinsurance to support our carrier partners,” said Nimmo. “Our specialty London team (has) been a huge success, but we wanted to find the opportunity to go global. Lockton has always focused on building businesses around talented people, and these three key hires give the market clear direction on the quality of the operation we want to build and who we want to build it with.”
Lockton launched a digital insurance broker called Mylo in 2016, with the aim of giving small businesses and individuals a quick, convenient way to get customised advice, consult with licensed agents, or compare and purchase insurance products online. In January 2019, it was revealed the firm had raised US$28 million in a Series A funding round led by Guggenheim Partners. While Lockton remains Mylo’s majority investor, any outside investment in the digital broker “validates its business strategy” and “helps support its success,” according to David Lockton, chairman of Lockton Companies.
“The combination of Mylo’s technological capabilities, its unique distribution strategy and Lockton’s legacy of excellence in insurance distribution led us to make this investment in Mylo,” said Micky Hervitz, a director at Guggenheim partners. “We view this investment as a long-term commitment to Mylo as Lockton works to bring digital solutions to improve the personal and small-business insurance-purchasing process.”
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He was previously a managing director with Aon