Marsh & McLennan Companies MRSH · USD

Segment InformationThe Company is organized based on the types of services provided. Under this structure, the Company’s operating segments are: Marsh Risk, Guy Carpenter, Mercer and Marsh Management Consulting. The four segments are aggregated into two operating and reporting segments as follows:▪Risk and Insurance Services, comprising Marsh Risk (insurance services) and Guy Carpenter (reinsurance services); and▪Consulting, comprising Mercer and Marsh Management Consulting. The accounting policies of the segments are the same as those used for the consolidated financial statements described in Note 1, Summary of Significant Accounting Policies. Revenues are attributed to geographic areas based on location out of which the services are performed. The Chief Executive Officer, as the Company's Chief Operating Decision Maker ("CODM"), evaluates segment performance and allocates resources based on segment operating income, which includes directly related expenses, and charges or credits related to restructuring but not the Company's corporate level expenses. Segment operating income is also used to monitor budget versus actual results.Selected information about the Company’s segments and geographic areas of operation are as follows:For the Years Ended December 31, (In millions)Revenue Compensation and benefits Depreciationandamortization expenseIdentified intangibleamortization expenseOther segment itemsOperatingIncome(Loss)2025 –Risk and Insurance Services$17,265 (a)$9,711 $204 $475 $2,239 $4,636 Consulting9,794 (b)5,710 100 74 2,014 1,896 Total Segments27,059 15,421 304 549 4,253 6,532 Corporate/Eliminations(78)156 57 — 18 (309)Total Consolidated$26,981 $15,577 $361 $549 $4,271 $6,223 2024 –Risk and Insurance Services$15,395 (a)$8,499 $192 $326 $2,013 $4,365 Consulting9,133 (b)5,358 114 51 1,840 1,770 Total Segments24,528 13,857 306 377 3,853 6,135 Corporate/Eliminations(70)139 63 — 46 (318)Total Consolidated$24,458 $13,996 $369 $377 $3,899 $5,817 2023 –Risk and Insurance Services$14,089 (a)$7,702 $190 $297 $1,955 $3,945 Consulting8,709 5,249 106 46 1,642 1,666 Total Segments22,798 12,951 296 343 3,597 5,611 Corporate/Eliminations(62)148 74 — 45 (329)Total Consolidated$22,736 $13,099 $370 $343 $3,642 $5,282 (a)Includes interest income on fiduciary funds of $403 million, $497 million and $453 million in 2025, 2024 and 2023, respectively, and equity method income of $24 million, $22 million and $18 million in 2025, 2024 and 2023, respectively.

RevenueThe core principle of the revenue recognition guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this principle, the entity applies the following steps: identify the contract(s) with the customer, identify the performance obligations in the contract(s), determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when (or as) the entity satisfies a performance obligation. In accordance with the accounting guidance, a performance obligation is satisfied either at a "point in time" or "over time", depending on the nature of the product or service provided, and the specific terms of the contract with customers. Other revenue included in the consolidated statements of income that is not from contracts with customers is less than 1% of total revenue and is not presented as a separate line item.Risk and Insurance ServicesRisk and Insurance Services revenue reflects compensation for brokerage and consulting services through commissions and fees. Commission rates and fees vary in amount and can depend on a number of factors, including the type of insurance or reinsurance coverage provided, the particular insurer or reinsurer selected, and the capacity in which the broker acts and negotiates with clients. For the majority of the insurance and reinsurance brokerage arrangements, advice and services provided which culminate in the placement of an effective policy are considered a single performance obligation. Arrangements with clients may include the placement of a single policy (single performance obligation), multiple policies or a combination of policy placements and other services. Consideration related to such "bundled arrangements" is allocated to the individual performance obligations based on their stand alone selling price (multiple performance obligations).Revenue for policy placement is generally recognized on the policy effective date, at which point control over the services provided by the Company has transferred to the client and the client has accepted the services.

DebtThe Company’s outstanding debt is as follows:December 31,(In millions)20252024Short-term:Current portion of long-term debt$1,267 $519 $1,267 $519 Long-term:Senior notes – 3.500% due 2025$— $500 Senior notes – 1.349% due 2026647 579 Senior notes – 3.750% due 2026600 599 Senior notes – 4.550% due 2027946 945 Senior notes – Floating due 2027299 299 Senior notes – 4.375% due 20291,499 1,499 Senior notes – 1.979% due 2030646 566 Senior notes – 2.250% due 2030744 742 Senior notes – 4.650% due 2030992 991 Senior notes – 2.375% due 2031398 397 Senior notes – 4.850% due 2031992 992 Senior notes – 5.750% due 2032494 494 Senior notes – 5.875% due 2033298 299 Senior notes – 5.400% due 2033594 593 Senior notes – 5.150% due 2034496 495 Senior notes – 5.000% due 20351,983 1,982 Senior notes – 4.750% due 2039496 496 Senior notes – 5.350% due 2044495 495 Senior notes – 4.350% due 2047494 494 Senior notes – 4.200% due 2048594 593 Senior notes – 4.900% due 20491,240 1,239 Senior notes – 2.900% due 2051346 346 Senior notes – 6.250% due 2052492 491 Senior notes – 5.450% due 2053591 591 Senior notes – 5.700% due 2053989 989 Senior notes – 5.450% due 2054493 493 Senior notes – 5.400% due 20551,479 1,479 Mortgage – 5.701% due 2035249 267 Other1 2 19,587 19,947 Less: current portion1,267 519 $18,320 $19,428 The senior notes in the table are registered by the Company with the Securities and Exchange Commission and are not guaranteed.The Company has a $3.5 billion short-term debt financing program through the issuance of commercial paper. The proceeds from the issuance of commercial paper are used for general corporate purposes. The Company did not have any commercial paper outstanding at December 31, 2025 and 2024. Credit FacilitiesThe Company has a $3.5 billion multi-currency unsecured five-year revolving credit facility (the "Credit Facility") expiring October 2028. Borrowings under the Credit Facility bear interest at a rate per annum equal, at the Company's option, either at (a) the Secured Overnight Financing Rate ("SOFR") benchmark rate for U.S. dollar borrowings, or (b) a currency specific benchmark rate, plus an applicable margin which varies with the Company's credit ratings. The Company is required to maintain certain coverage and leverage ratios for the Credit Facility, which are evaluated quarterly.

Income TaxesFor financial reporting purposes, income before income taxes includes the following components: For the Years Ended December 31,(In millions)202520242023Income before income taxes:U.S.$1,986 $1,894 $1,823 Foreign3,553 3,586 3,203 $5,539 $5,480 $5,026 The expense (benefit) for income taxes is comprised of:Current –U.S. federal$203 $247 $273 U.S. state and local131 123 142 Foreign848 836 838 1,182 1,206 1,253 Deferred –U.S. federal73 53 29 U.S. state and local16 20 15 Foreign34 84 (73) 123 157 (29)Total income taxes$1,305 $1,363 $1,224 The significant components of deferred income tax assets and liabilities and their balance sheet classifications are as follows:December 31,(In millions)20252024Deferred tax assets:Accrued expenses not currently deductible$745 $713 Differences related to non-U.S. operations (a)286 282 Accrued U.S. retirement benefits131 149 Net operating losses (b)346 312 Income currently recognized for tax39 40 Other49 40 $1,596 $1,536 Deferred tax liabilities: Differences related to non-U.S. operations$590 $588 Depreciation and amortization699 616 Accrued retirement & post-retirement benefits – non-U.S. operations440 374 Capitalized expenses currently recognized for tax144 133 Other48 42 $1,921 $1,753 (a)Net of valuation allowances of $96 million in 2025 and $75 million in 2024.(b)Net of valuation allowances of $62 million in 2025 and $69 million in 2024.December 31,(In millions)20252024Balance sheet classifications:Deferred tax assets$212 $237 Other liabilities$537 $454 Additional U.S. state and withholding taxes would apply to the cumulative undistributed earnings that are indefinitely reinvested in non-U.S. subsidiaries, if such earnings were repatriated. The amount of these additional taxes is estimated to be approximately $100 million.Future U.S. federal tax costs related to basis differences in non-U.S. subsidiaries are realized through the U.S. Net Controlled Foreign Corporation Tested Income ("NCTI") minimum tax regime, formerly known as Global Intangible Low-Taxed Income ("GILTI"). The Company elected to recognize NCTI tax costs as a period cost and has not provided deferred tax liabilities on these basis differences.A reconciliation from the U.S. federal statutory income tax rate to the Company’s effective income tax rate is as follows:For the Years Ended December 31,2025AmountPercentageU.S. federal statutory rate$1,163 21.0 %U.S. state and local income taxes – net of U.S. Federal income tax benefit (a)116 2.

LeasesThe Company leases office facilities under non-cancelable operating leases with terms generally ranging between 10 and 25 years. The Company utilizes these leased office facilities for use by its employees in countries in which the Company conducts its business. The Company’s leases have no restrictions on the payment of dividends, the acquisition of debt or additional lease obligations, or entering into additional lease obligations. The leases also do not contain significant purchase options. Operating leases are recognized on the consolidated balance sheets as ROU assets and operating lease liabilities based on the present value of the remaining future minimum payments over the lease term at the commencement date of the lease. On November 15, 2024, the Company recorded approximately $76 million of ROU assets and lease liabilities from the McGriff acquisition.In 2025 and 2024, the Company determined that a total of $11 million and $15 million, respectively, of the ROU assets were impaired and recorded a charge to the consolidated statements of income with an offsetting reduction to the ROU assets.The following table provides additional information about the Company’s property leases:For the Years Ended December 31,(In millions, except weighted average data)20252024Lease Cost:Operating lease cost (a)$351$331Short-term lease cost56Variable lease cost134116Sub-lease income(22)(15)Net lease cost$468$438Other information:Operating cash outflows from operating leases$402$376Right of use assets obtained in exchange for new operating lease liabilities$187$279Weighted average remaining lease term – real estate7.23 years7.57 yearsWeighted average discount rate – real estate leases3.73 %3.73 %(a)Excludes ROU asset impairment charges.Future minimum lease payments for the Company’s operating leases at December 31, 2025 are as follows:(In millions)Real Estate Leases2026$393 2027359 2028281 2029233 2030199 Subsequent years653 Total future lease payments2,118 Less: imputed interest(256)Total$1,862 Current lease liabilities$333 Long-term lease liabilities1,529 Total lease liabilities$1,862 Note: The above table excludes obligations for leases with original terms of 12 months or less which have not been recognized as a ROU asset or liability in the consolidated balance sheets.At December 31, 2025, the Company had additional operating leases that had not yet commenced of $36 million. These operating leases will commence over the next 12 months.

Acquisitions and DispositionsThe Company’s acquisitions have been accounted for as business combinations. Net assets and results of operations are included in the Company’s consolidated financial statements commencing at the respective purchase closing dates. In connection with acquisitions, the Company records the estimated values of the net tangible assets and the identifiable intangible assets purchased, which typically consist of customer relationships, developed technology, trademarks and non-compete agreements. The valuation of purchased intangible assets involves significant estimates and assumptions. The Company estimates the fair value of purchased intangible assets, primarily using the income approach, by determining the present value of future cash flows over the remaining economic life of the respective assets. The significant estimates and assumptions used in this approach include the determination of the discount rate, economic life, future revenue growth rates, expected account attrition rates and earnings margins. Refinement and completion of final valuation of net assets acquired could affect the carrying value of tangible assets, goodwill and identifiable intangible assets.The Risk and Insurance Services segment completed 14 acquisitions in 2025:•January – Guy Carpenter acquired the remaining 51.5% ownership share in Carpenter Turner Cyprus Ltd., a Greece-based insurance broker that provides reinsurance and advisory services, including treaty and facultative reinsurance, data and analytics, strategic advisory, and capital markets solutions.•February – Marsh Risk acquired Fontana Rava-Toscano & Partners S.r.l., an Italy-based insurance broker that offers property and casualty insurance brokerage and risk consulting.•March – Marsh Risk acquired the business of Cohere Insurance Solutions, an Australia-based insurance broker that specializes in life sciences, start-up and professional services businesses. •April – Marsh McLennan Agency ("MMA") acquired Arthur C. Hall Insurance, Inc., a Pennsylvania-based insurance broker that provides commercial and personal lines solutions to clients, with specialties in life sciences, information management, non-profit, craft beverage manufacturing and municipal industries.

Our Board of Directors has overall oversight responsibility for the Company’s risk management and receives updates from management throughout the year on cybersecurity matters and other material risks facing the Company. Additionally, the Audit Committee regularly reviews the Company’s policies and practices with respect to risk assessment and risk management, including cybersecurity risks, and reports to the full Board of Directors on a regular basis. The Audit Committee is responsible for overseeing the Company’s enterprise risk management policies and processes, including discussing with management the Company’s major risk exposures and the steps that have been taken to monitor and control such exposures, including those arising from cybersecurity risks. Management is responsible for identifying, assessing and managing material cybersecurity risks on an ongoing basis. Management’s efforts include establishing processes designed to ensure that potential cybersecurity risks are monitored, putting in place mitigation and remedial measures and implementing and maintaining cybersecurity programs. Our cybersecurity programs are under the direction of our Chief Information Security Officer & Chief Technology Officer (CISO/CTO), who reports to our Chief Information & Operations Officer (CIOO). Our CIOO has significant expertise and over a decade of experience working in technology. Our CISO/CTO has over two decades of experience working in cybersecurity and maintains a Certified Information Systems Security Professional certification. Our CISO/CTO and CIOO receive reports from our cybersecurity team and monitor the prevention, detection, mitigation, and remediation of cybersecurity incidents. Our cybersecurity team is comprised of experienced information systems security professionals and information security managers with many years of experience and various security certifications. Management, including the CIOO and CISO/CTO, regularly reviews with the Board of Directors and the Audit Committee the Company’s cybersecurity programs, material cybersecurity risks and mitigation strategies and provides updates on notable developments in the cybersecurity threat landscape. Additionally, management follows a risk-based escalation process to notify the Audit Committee outside of the cycle of regular updates when an emerging risk or material issue is identified, such as a potentially significant cybersecurity threat or incident.

DerivativesNet Investment HedgeThe Company has investments in various subsidiaries with Euro functional currencies. As a result, the Company is exposed to the risk of fluctuations between the Euro and U.S. dollar exchange rates. As part of its risk management program, the Company designated its €1.1 billion senior note debt instruments ("Euro notes") as a net investment hedge (the "hedge") of its Euro denominated subsidiaries. The hedge effectiveness is re-assessed each quarter to confirm that the designated equity balance at the beginning of each period continues to equal or exceed 80% of the outstanding balance of the Euro debt instrument and that all the critical terms of the hedging instrument and the hedged net investment continue to match. If the hedge is highly effective, the change in the debt balance related to foreign exchange fluctuations is recorded in accumulated other comprehensive loss in the consolidated balance sheets. The U.S. dollar value of the Euro notes increased by $149 million in 2025, related to the change in foreign exchange rates. The Company concluded that the hedge was highly effective and recorded an increase to accumulated other comprehensive loss for the year ended December 31, 2025.