Brown & Brown reports record first-quarter net income of 22 percent over the previous period primarily on the increase in commissions and fees, as insurers press for rate increases, with significant focus on the Superstorm Sandy-affected regions.

The Daytona Beach, Fla.-based insurance broker says Q1 net income was up $11 million to $60 million on revenues of $335 million, an increase of 11 percent, or $33 million.

“This is the most net income we have ever earned in the first quarter,” says Chief Financial Officer Cory T. Walker during a conference call with analysts.

Executives note positive trends in all its business segments, underscored by the firm's organic growth up by 10 percent.

President and CEO J. Powell Brown, discussing the insurance market in general, says rates overall are on the upswing throughout the U.S., increasing in some cases from flat to mid-single digits depending upon the perception of risk among carriers. In a few markets carriers are seeking rate hikes as high as 10 percent.

Focusing on the New Jersey, New York and Long Island area, Powell says carriers are making the most underwriting changes on commercial property accounts with attempts at increases as high as 8 percent. He says capacity on wind risk is tightening throughout the region, and coastal areas within five to eight miles of the coast have seen their wind deductibles go from flat rates to 2 percent increases.

Flood deductibles have doubled and some standard market carriers are non-renewing, pushing property risks into the Excess and Surplus lines market, says Powell. E&S carriers are increasing prices by 10 percent or more on habitation, along with changes in terms and conditions. Some insurers are not insuring wood frame structures and are cutting flood limits or increasing prices substantially.

“It's a brave new world” for E&S carriers in the New York and New Jersey area, says Brown.

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Brown & Brown Reports Record Q1 Income

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