The action comes as Willis begins to realize the full effects of the elimination of contingency fees from insurers. Willis reported $3 million in contingent commissions in the quarter compared to a total of $21 million from a year ago. The 2005 contingent commission payments came from outside of the U.S.

The broker eliminated all contingent commissions in October after New York Attorney General Eliot Spitzer announced that an investigation of Marsh & McLennan Companies' Marsh brokerage had found the fees were part of a price-fixing and bid-rigging scheme and served as payoffs for improper steering of customers.

For the first quarter, Willis reported net income declined by $76 million, going from $148 million, or 87 cents a share in 2004, to $72 million, or 43 cents a share. Revenues increased 1 percent, or $4 million, going from $665 million to $669 million.

The first-quarter report included a charge of $51 million for the reimbursement fund set up to settle the investigations by Mr. Spitzer and Minnesota's Attorney General Mike Hatch. The firm also recorded $9 million in legal and administrative fees and increased its provision for claims by $20 million.

Mr. Plumeri said Willis is going through a "metamorphosis?breaking from the old and introduction of the new."

He said the first-quarter results contained the "shedding of all the bad things and none of the good we will see going forward" within Willis, adding, "This is a model [that will be] much more enduring going forward."

Mr. Plumeri indicated that he was disappointed that insurers have not come to terms with Willis over the payment of fees for services the broker provides to them but was optimistic it would be resolved eventually.

The firm collected $3 million in service fees from carriers. He said this figure should increase over the cost of the year. In 2004, the broker collected $22 million in the first quarter for such services.

In response to questions from investment analysts, Mr. Plumeri said he could not predict when the fee issue would be resolved, or how much would be paid, but he was optimistic a solution would be found.

Organic revenue growth stood at 2 percent, which he called "magnificent" considering the transition the firm is going through. He noted that Willis is seeing business from clients who previously had placed all of their business with one broker and are now bringing the lines to other firms.

Premium rates are in decline, he noted, generally in line with a Council of Insurance Agents & Brokers survey that said rate declines are averaging 10 percent. He added that some accounts are seeing greater decreases.

Willis also reported a new stock buy back plan of $300 million, which replaces a previous buy back plan of $500 million. It also declared a quarterly cash dividend payment of 21.5 cents a share, payable on July 14 to shareholders of record as of June 30.