Segment Information

12 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Segment Information

Segment Information

Brown & Brown’s business is divided into four reportable segments: (1) the Retail Segment, which provides a broad range of insurance products and services to commercial, public and quasi-public entities, and to professional and individual customers, (2) the National Programs Segment, which acts as a MGA, provides professional liability and related package products for certain professionals, a range of insurance products for individuals, flood coverage, and targeted products and services designated for specific industries, trade groups, governmental

entities and market niches, all of which are delivered through nationwide networks of independent agents, and Brown & Brown retail agents, (3) the Wholesale Brokerage Segment, which markets and sells excess and surplus commercial and personal lines insurance, primarily through independent agents and brokers, as well as Brown & Brown retail agents, and (4) the Services Segment, which provides insurance-related services, including third-party claims administration and comprehensive medical utilization management services in both the workers’ compensation and all-lines liability arenas, as well as Medicare Set-aside services, Social Security disability and Medicare benefits advocacy services and claims adjusting services.

Brown & Brown conducts all of its operations within the United States of America, except for a Wholesale Brokerage operation based in London, England, and Retail operations in Bermuda and the Cayman Islands. These operations earned $15.9 million, $14.5 million and $13.4 million of total revenues for the years ended December 31, 2017, 2016 and 2015, respectively. Long-lived assets held outside of the United States during each of these three years were not material. Additionally, we have a licenses to operate as a broker in various Canadian provinces.

The accounting policies of the reportable segments are the same as those described in Note 1. The Company evaluates the performance of its segments based upon revenues and income before income taxes. Inter-segment revenues are eliminated.

Summarized financial information concerning the Company’s reportable segments is shown in the following table. The “Other” column includes any income and expenses not allocated to reportable segments and corporate-related items, including the intercompany interest expense charge to the reporting segment.

	For the year ended December 31, 2017
(in thousands)	Retail		National Programs		Wholesale Brokerage		Services		Other			Total
Total revenues	$	943,460	$	479,813	$	271,737	$	165,372	$	20,965		$	1,881,347
Investment income	$	8	$	384	$	—	$	299	$	935		$	1,626
Amortization	$	42,164	$	27,277	$	11,456	$	4,548	$	1		$	85,446
Depreciation	$	5,210	$	6,325	$	1,885	$	1,600	$	7,678		$	22,698
Interest expense	$	31,133	$	35,561	$	6,263	$	3,522	$	(38,163	)	$	38,316
Income before income taxes	$	196,616	$	109,961	$	68,844	$	30,498	$	43,803		$	449,722
Total assets	$	4,255,515	$	3,267,486	$	1,260,239	$	399,240	$	(3,434,930	)	$	5,747,550
Capital expenditures	$	4,494	$	5,936	$	1,836	$	1,033	$	10,893		$	24,192

 

	For the year ended December 31, 2016
(in thousands)	Retail		National Programs		Wholesale Brokerage		Services		Other			Total
Total revenues	$	917,406	$	448,516	$	243,103	$	156,365	$	1,239		$	1,766,629
Investment income	$	37	$	628	$	4	$	283	$	504		$	1,456
Amortization	$	43,447	$	27,920	$	10,801	$	4,485	$	10		$	86,663
Depreciation	$	6,191	$	7,868	$	1,975	$	1,881	$	3,088		$	21,003
Interest expense	$	38,216	$	45,738	$	3,976	$	4,950	$	(53,399	)	$	39,481
Income before income taxes	$	188,001	$	91,762	$	62,623	$	24,338	$	56,775		$	423,499
Total assets(1)	$	3,854,393	$	2,711,378	$	1,108,829	$	371,645	$	(2,783,511	)	$	5,262,734
Capital expenditures	$	5,951	$	6,977	$	1,301	$	656	$	2,880		$	17,765

 

	For the year ended December 31, 2015
(in thousands)	Retail		National Programs		Wholesale Brokerage		Services		Other			Total
Total revenues	$	870,346	$	428,734	$	216,996	$	145,365	$	(932	)	$	1,660,509
Investment income	$	87	$	210	$	150	$	42	$	515		$	1,004
Amortization	$	45,145	$	28,479	$	9,739	$	4,019	$	39		$	87,421
Depreciation	$	6,558	$	7,250	$	2,142	$	1,988	$	2,952		$	20,890
Interest expense	$	41,036	$	55,705	$	891	$	5,970	$	(64,354	)	$	39,248
Income before income taxes	$	181,938	$	67,673	$	64,708	$	19,713	$	68,527		$	402,559
Total assets(1)	$	3,507,476	$	2,503,537	$	895,782	$	285,459	$	(2,212,410	)	$	4,979,844
Capital expenditures	$	6,797	$	6,001	$	3,084	$	1,088	$	1,405		$	18,375

(1)

Total assets have been restated to reflect the adoption of ASU No. 2015-17, “Income Taxes (Topic 740) - Balance Sheet Classification of Deferred Taxes” (“ASU 2015-17”).