Company Reports

Australia's largest insurance broker Steadfast increased fiscal 2026 profit by 7% to AUD 366 million, given a boost from acquisitions as soft premium increases are slowing organic growth. Fiscal 2027 profit before amortization guidance points to growth of up to 7%.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in the insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premiums written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in the insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premiums written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.

Steadfast has received a nonbinding indicative acquisition proposal for AUD 6.00 cash per share, a 52% premium to the last close price. The bid comes from a consortium of Amwins, a wholesale specialty insurance distributor, and Dragoneer, an investment firm and a shareholder in Amwins.

As enhancements in generative artificial intelligence models continue rapidly, concerns grow that humans will be cut out of the insurance distribution chain. Insurance broker shares have sold off, implying the market thinks brokers offer little more than policy comparison and quote generation.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in the insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premiums written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in the insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premiums written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.

Steadfast increased its interim underlying profit 6% to AUD 162 million, mostly driven by acquisitions, as a period of soft premium increases slowed organic growth. Fiscal 2026 profit before amortization guidance is maintained, up 8% at the top of the range.

Fears of artificial intelligence disruption hit shares of insurance brokers worldwide after reports that OpenAI approved its first insurance app on ChatGPT. According to reports, a Spanish digital insurer launched an app that lets consumers generate a personalized home insurance quote.

Steadfast Group reported a 2.4% increase in base insurance premiums on average for the first five months of fiscal 2026. This exceeds management's full-year expectation of a 1%-2% increase announced in the annual general meeting, when limited early-year data prompted a cautious outlook.

Details are scarce, but Steadfast CEO Robert Kelly is temporarily stepping aside while it investigates a workplace complaint against him. Separately, fiscal 2026 guidance is reaffirmed despite a lower-than-budgeted increase in premium rates in the first quarter. Shares dived on the news.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premium written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premium written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.

Australia's largest insurance broker, Steadfast, increased its underlying profit before amortization by 15% to AUD 346 million, benefiting from higher insurance premiums, new brokers joining, and acquisitions. Fiscal 2026 underlying profit is guided to be up 5%-8%.

Over the past 12 months, AUB has delivered total shareholder returns of 15%, modestly outperforming 13% for the S&P/ASX 200 and well ahead of peer Steadfast, which is all square. But this is much lower than returns of general insurers IAG, QBE, and Suncorp, which have posted above 30% returns.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premium written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.

Narrow-moat Steadfast saw first-half fiscal 2025 broking gross written premium rise by 7.9%, and underwriting by 11.7%. Underlying EBITDA of AUD 262 million was up 15% from a year ago and close to our expectations.

As part of Steadfast's ongoing review of strata broker and underwriting business practices, greater transparency and disclosure is to be rolled out. However, no evidence of channeling incentives between Steadfast-related entities, or deliberate actions to skirt legal obligations, has been found.

Steadfast's, and to a lesser extent, AUB Group's, shares fell materially following an ABC report concerning strata insurance commissions. The crux of the allegations being that Steadfast brokers are conflicted in recommending strata insurance because Steadfast owns the largest strata agency in the country, CHU. And as a result, premiums are rising for customers because of Steadfast’s market dominance. Another claim, which Steadfast did not dispute, is the existence of joint ventures between brokers and strata managers that potentially skirt the strata managers' disclosure requirement as it is not “commission.” This is a bad look, adding an unnecessary financial incentive to use one broker over another. Considering all this, the chair of Australia’s competition regulator is calling for a ban on strata insurance commissions. Nevertheless, we think both narrow-moat firms are undervalued, with the potential regulatory intervention in the sector rattling confidence.

Steadfast Group operates the largest general insurance broker network in Australia and New Zealand. Taking equity interests in insurance broker business, Steadfast has been consolidating the market since it was founded in 1996. It has deployed a similar strategy in underwriting agencies. It derives revenue by being paid a commission (from insurers) based on gross written premium written by agencies within its network, earning a share of profits from associates and joint ventures, and receiving professional services fees.