Marsh & McLennan suffers on back of Kroll writedown

City A.M. Reporter
MARSH &amp; MCLENNAN (MMC), the world&rsquo;s second largest global insurance broker, posted quarterly results in line with expectations yesterday and forecast improved profitability for its brokerage business.<br /><br />The US firm reported a second-quarter net loss, hurt by a $315m (&pound;185m) charge on the restructuring of Kroll, its security consulting business. The firm posted a $193m net loss in the quarter, compared with a year-earlier profit of $65m.<br /><br />But excluding the Kroll charge, it posted a profit that matched Wall Street&rsquo;s average forecast and said it expects an improvement in profit at its brokerage business this year.<br /><br />While falling insurance rates in recent years have cost brokers, who are largely compensated by commissions, most have curbed spending, helping to cushion the bottom line.<br /><br />Once the world&rsquo;s largest insurance brokerage, MMC faltered after a 2005 investigation into commission agreements with insurers it represented, triggering a costly settlement charge and loss of business. Over time, it lost its dominant position to Aon.<br /><br />But investors hope MMC, under new management, is about to turn the corner.