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2004 Insurance Broker Report Outlines Spitzer Settlements and Results...

April 21, 2005 -- WFG Capital Advisors LP, a leading investment banking firm to the insurance industry, announced today that its 2004 annual research among the industry's leading brokers indicates that many firms continue to report an escalating decline in organic revenue.



According to Steven Wevodau, Managing Principal of WFG, "2004 results among the leading distributors contained in WFG's Broker Insights report supports that industry leaders continue to show declines in organic revenue growth. In essence, the organic revenue growth composite is decreasing at an increasing rate."



Wevodau added, "The eight leading firms reported a composite 5% organic revenue decline for the quarter ending December 2004. In other words, if you remove the benefit of acquisitions and foreign currency exchange fluctuations, organic revenue growth among the industry's leading firms continues to shrink their revenue base. For comparison purposes, this same segment posted an 8.4% increase in revenues for the same period in 2003. Product rate stabilization continues to seriously impact the industry leaders. The overall direction of the market would strongly suggest that these firms are contending with increased competition, client scrutiny and market softening. When you combine all these factors, it only makes the outlook cloudier."



According to Rob Lieblein, President of WFG, "The recent settlements with various attorney generals would indicate that the market segment is aggressively seeking resolution of all regulatory impediments. As many firms resolve impending investigations and opt to forego contingent awards, the industry faces further challenges to replace lost revenues and to continue to demonstrate growth. 2005 will present numerous challenges for the industry leaders and our goal is to provide qualitative and quantitative insights among the peer group leaders. Clearly, the Spitzer settlements with Marsh and Aon serve as critical catalysts for many industry leaders to look upon. WFG's report offers comprehensive insights into this impact to the industry segment as well as offering an outlook for many other firms."

    


A comprehensive report of the industry research is included in the March 2005 edition of Broker Insights. The report can be obtained at the WFG web site, www.wfgca.com, by selecting the "Publications" link, or by contacting WFG at (717) 780-7800.



About WFG Capital Advisors:

WFG Capital Advisors, based in Harrisburg, Pennsylvania, is a leading investment banking firm to the insurance industry.



Media Contacts:

Steven S. Wevodau, Managing Principal

Tel: 717.780.7802 / e-mail protected from spam bots



Robert J. Lieblein, President

Tel: 717.780.7801 / e-mail protected from spam bots



www.wfgca.com

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