Hub Income Increases 71%

Martin P. Hughes, chairman and chief executive officer of Hub, said the results were broad-based resulting from a combination of acquisitions and organic growth. Core commissions rose 44 percent to 89 million, and contingent commissions rose 94 percent to more than $29 million. A strong Canadian dollar also added 3 percent to the company's organic growth.

However, he called the current insurance market "tough," with decreases in premium averaging 5-to-7 percent for the firm from last year. To keep even, he said, the firm must grow underwriting by the same percentage.

"We are not, as a rule, seeing irresponsible underwriting," said Mr. Hughes. "Of course, there are anomalies where you have to shake your head and say, ?What the heck is this underwriter thinking about?' But that seems to be the exception."

He noted that if insurers want to remain profitable, they have to stick to strict underwriting guidelines.

"While history tells me I'm nuts to expect discipline from underwriters, I'm hopeful that this time around, things will be different," he remarked.

Mr. Hughes said Hub is continuing to cooperate with ongoing investigations by state attorneys general and insurance regulators concerning questionable activity related to broker acceptance of insurers' incentive payments known as contingency fees that have been tied to client steering and price-fixing. He said he had nothing additional to add.

Hub's subsidiary, Kaye Insurance Associates Inc., in New York, has received subpoenas from New York Attorney General Eliot Spitzer in his probe of contingent fee commission abuses. It has also received inquiries or subpoenas from authorities in California, Connecticut, Texas, Illinois, Delaware, Pennsylvania, New Hampshire and Quebec, Canada, between August 2004 and February 2005.

To date, the investigation, which has taken on national dimensions, has resulted in three settlements by Marsh & McLennan, Aon and Willis of more than $1 billion, and guilty pleas by at least 10 insurance executives.