Welcome to the Marsh & McLennan Companies' Conference Call. Today's call is being recorded. Third Quarter 2017 Financial Results and supplemental information were issued earlier this morning. They are available on the company's website at www.mmc.com. Please note that remarks made today may include forward-looking statements. Forward-looking statements are subject to risk and uncertainties, and a variety of factors may cause actual results to differ materially from those contemplated by such statements. For a more detailed discussion of those factors, please refer to our earnings release for this quarter and to our most recent SEC filings, including our most recent Form 10-K, all of which are available on the MMC website. During the call today, we may also discuss certain non-GAAP financial measures. For a reconciliation of these measures to the most closely comparable GAAP measures, please refer to the schedule in today's earnings release. I'll now turn this over to Dan Glaser, President and CEO of Marsh & McLennan Companies.

Thank you, Elaine. Good morning, and thank you for joining us to discuss our third quarter results reported earlier today. I'm Dan Glaser, President and CEO of Marsh & McLennan Companies. Joining me on the call today is Mark McGivney, our CFO; and the CEOs of our businesses John Doyle of Marsh; Peter Hearn of Guy Carpenter; Julio Portalatin of Mercer; and Scott McDonald of Oliver Wyman. Also with us this morning is Dan Farrell of Investor Relations. Since the beginning of the third quarter we have seen a heightened level of natural and man-made catastrophe losses, including major hurricanes and typhoons, earthquakes, wildfires, senseless acts of violence and disclosures of large scale cyber events. Before we get into our third quarter results, I want to take a moment to discuss how we have been supporting our clients and colleagues, the potential market impact of these events, and the critical role that our industry plays in society. While the insurance industry has the capital strength and structural resilience to absorb these losses, the human toll has been [sobering] with significant injury and loss of life across these events. Many other individuals have been impacted through loss of homes, basic services and business interruption. The natural catastrophes of this quarter directly impacted roughly 4000 of our colleagues across over 50 of our offices. While we are very fortunate that all of our colleagues in these affected areas are safe and accounted for, there were some who tragically lost family members and our deepest sympathies go out to them. Catastrophes that occur in a different geographic region can seem remote and distance unless we are directly impacted as individuals. This is not the case at Marsh & McLennan. We understand the devastation and the stress that severe losses put on people and…

Thank you, Dan, and good morning. Our third-quarter results were solid. Consolidated revenue increased 7%, 3% on an underlying basis. Operating income in the quarter increased 4%, while adjusted operating income was up 11% to $624 million. Adjusted operating margin increased 70 basis points to 18.7%. GAAP EPS rose 4% to $0.76 and adjusted EPS increased 14% to $0.79. Looking at Risk & Insurance Services, third quarter revenue was $1.8 billion, reflecting growth of 8%, 3% on an underlying basis. Adjusted operating income increased 12% to $337 million, with our margin expanding 60 basis points to 19.1%. For the first nine months of the year, revenue was $5.7 billion with growth of 6% with 3% on an underlying basis. Adjusted operating income for the first nine months of the year increased 10% to $1.5 billion with a margin of 26%, up 90 basis points. At Marsh, revenue in the quarter was $1.5 billion, an increase of 9%, with a strong contribution from acquisition activity. On an underlying basis, Marsh’s revenue increased 3% in the third quarter. In U.S. and Canada, underlying revenue growth was 3% in both the third quarter and the first nine months. In the international division, underlying growth was 2% in the quarter. Latin America was up 9%, Asia-Pacific grew 7% and EMEA was down 2%. For the first nine months, international underlying revenue growth was 3% with 7% growth in both Latin America and Asia-Pacific and 1% growth in EMEA. Guy Carpenter's revenue was $270 million, an increase of 4% on an underlying basis driven by strong growth in the U.S.. Underlying revenue growth in the first nine months was also 4%. In the Consulting segment, revenue of $1.6 billion was up 5%, 2% on an underlying basis. Adjusted operating income increased 7% to $330 million,…

Thanks, Mark. Okay Elaine, we're ready to go to Q&A.

Thank you. [Operator Instructions] And we will take our first question from Ryan Tunis with Credit Suisse.

Hi, thanks. Good morning. So, I guess just following up on Dan’s comments in his prepared remarks, it sounded like, I think you said this may just be an earnings event for the industry and that might not have as great of an impact on price, I guess one question is, is there a view at Marsh about – I guess what the ultimate loss might be from all of these CATs because one of the debates going around is, is it a 120 billion or is it more like a $50 billion or $60 billion event you kind of infer from some of the announcements?

Thanks Ryan. There is a couple of things. Let me just start, and then I think I will hand over to Peter rather than John to give you a view as to the overall market and level of losses, and I can say it is going to take some time to determine the aggregate level of loss per claim and how it is ultimately distributed amongst insurance companies and also other capital providers. What is clear so far is that the announced losses thus far are far short of the estimates provided by the modeling firms. I mean that – and that is not that different from some other catastrophes that have occurred in the past. It is just too early to tell what the ultimate losses will be. Having said that, catastrophe losses tend to get larger over time rather than smaller, but Peter do you have more to add to that?

Yes, Dan. I think Ryan, if we look at what has been – to your question, what has been reported to date is about 30 billion, and if you add FEMA into it, and you add another 20 billion on top of that for unreported to date, there is still a delta between that and what the modeled loss of 100 billion that has been thrown around. So these are long-duration complex losses, and they take a long time to settle out. We tend to get a number set in our mind, and as Dan said, property losses have a toll on them, not as long as casualty losses, but they have a toll on them, and these will develop. And over time, I would imagine that delta will reduce.

Yes. Just on the 4% organic in Guy Carpenter, and I guess thinking about what the normalized growth is there? Is there any way you can quantify – how you think that might have been augmented this quarter from I guess any [indiscernible] purchasing or anything like that that might have happened associated with the storms? Thanks.

I mean a couple of things. I will hand it off to Peter in a second, but bear in mind over a long stretch of time, Guy Carpenter has been a good grower for us, and in fact, has grown underlying revenue 26 of the past 27 quarters, and we have got three consecutive quarters at 4%. It is hard to talk about what normal is, I mean, at the end it is a very segmented, specialized business, which will have its ups and downs, but certainly for us the last three quarters have been at 4%. But Peter?

Thank you Dan. I mean, Ryan, revenue from reinstatement covers as a result of Harvey, Irma and Maria didn't have a meaningful impact on our Q3 results.

Thanks Peter. Next question please.

And our next question comes from Elyse Greenspan with Wells Fargo.

Hi, good morning. My first question, I just was hoping maybe to get a little bit more color on the pricing environment to stand to some of your comments that kicked off the call, I guess. Maybe this is both a primary and a reentrance question but how is the dialogue following the storm going with both insurance carriers as well as your clients. As we think about some insurance companies have pointed to wait going outside of just areas impacted by losses and the reinsurance market and then if we think about the commercial lines market more broadly, some saying maybe this will have the potential to increase weight outside of just property related coverage. So, how is the dialogue going even a way from just whether this is a $50 million to a $100 million event but how is conversations going in and around the level of rate that might come next year?

Thanks Elyse, it's a good question. I'll take it to begin with on in overview standpoint and then I think it's good to hear from both John and Peter to get there their views of what's happening in their respective areas. But I think we have to start by saying insurance market itself is a large global and well capitalized. And there are many insurers and other capital providers, so the market is competitive. Certain markets it's true have been hit pretty hard by these series of events and they're going to one rate increases. That doesn’t mean they're going to get the rate increases they want. I mean, that's where the competitiveness of the market comes in and this is going to play out overtime. Our job is to be on the client side of the table and to get the most comprehensive level of coverage that they're seeking at competitive terms. And so, John you want to talk about what you're seeing at Marsh so far?

Sure, Dan. Good morning, Elyse. Why don’t I start with what we saw in the third quarter and then I can share a little bit of data in what we've seen over the course of the last few weeks. But in the third quarter, rates were down 1.6% which compares to a decline of 2.2% in the second quarter or so. Things have been trending a little bit closer to zero over the course of the last several quarters. But I would say by major product it's a pretty type range when you look at it on a global basis. The U.K. and commonly Europe have continued to remain in those competitive markets on a price change basis. Australia pricing for the second quarter in a row has set up. Looking ahead, insurers have certainly been communicating to us their need for increased rates given the recent cad events. Some were suggesting that the rate need for them as across the board, others have been communicating needs more focused on cad property. As Dan said, it's really too early to tell what I can share is both over the last few weeks in property have ranged from minus five to plus 20 to plus 20 and there are no measurable impact so far in other lines at this point. Now would say in my experience will be unusual for these events that drive pricing in long tail lines. Just maybe for a second talking about the impact of some of these price changes on Marsh, it would be mixed. On the one hand, we could see some modest uplift on pricing from commissionable premium, we'll see a little bit of more work on our claim in our claims operation as well. However it could impact had some impact on our contingent revenue primarily at MMA course. And then we don’t know a buyer bays that would be like, operating in a low growth worldwide our clients are very cost focused at the moment. We'll see whether or not particularly our larger clients to choose to retain more risk over time. Then we'll have places like markets like Porto Rico which will likely face some challenges. Now, also why I now release that we've been expanding our capabilities in property cat, really trying to be responsive to this growing risk for our clients. Dan mentioned the acquisition of Blakestad in the second quarter or in the third quarter, excuse me, we also acquired Torrent, Dan spoke a bit about that and we created alternatives the first ever retail alternative capital facility in the second quarter or so. We're well positioned to help our clients navigate market as we go forward.

Thanks, John. Peter, you want to add to that?

Sure, thanks Dan. In the conversations released, we have it reinsurers as is always the takes, we ask them to take it client specific, very measured approach based on their experience, individual clients experience, exposure and their trading relationship with the reinsurers. And preface is it's early it's too early to tell a leading indicators as to where prices is going. But that's the approach that we take, a very balanced and fair approach based on individual company, experience exposure in their trading relationships.

Any other question, Elyse?

Yes, thank you. And that was very thorough. I appreciate the color. In terms of the margins within RIS, the margin improvement did slow in the third quarter. And I know you guys pointed in your opening commentary that the year-to-date improvement. Was there anything that crept up in the third quarter that caused the slowdown in margins or it was just we see margins up to the year-to-date level?

You should always look to the year-to-date or rolling 12 months or even over multiple years. I mean I were in the 10th year consecutive margin expansion and so they it's a great story considering we're not overly focused on it here at the executive table. But the other things to think about with regard to RIS, the third quarter is our lowest revenue quarters. So, if you've got a some movement expansive would have a larger term impact. But there's nothing underlying that to point to anything that we're concerned with regard to RIS margins.

Much.

Sure, next question please?

And our next question comes from Kai Pan with Morgan Stanley.

Good morning and thank you. And just following up these question, the pace of margin expansion. I hope you can talk a little more about underlying drivers in term, do you see any pressure on the wages, any investment you need to make into the fitness and any cost saving opportunities within the organization. And you have talked even past the margin expansion is a byproduct of your driving organic growth budget. I just want to understand it the better.

Sure. And what we said in the past is that margin expansion is an outcome of running a business to where almost always you expect to have revenue growth exceeding expense growth of maybe not every corner but certainly every year. And when we looked back in our history, the 35 of the past 38 quarters, we have had revenue growth that exceed expense growth. And so, it's just a core part of the way we operate the business. When you think about things like wage pressure, it's something that we look at carefully, the reality is that our we have converted over the last number of years, more of our compensation to variable that it has been in the past. We still have a large fixed component but the bonus pool is driven by earnings and some measure of topline growth and that drives overall accruals within our bonus pool as you can see. Our earnings has gone up multiple years in a row which if it's a little bit more flexibility when we look at compensation in general because the variable component has ridden over a number of years. In terms of wage growth, it's interesting because in the global economy and here in the U.S. we haven’t really seen that operate, so there is that economic theory about a tightening labor market ultimately playing through with wages, but I think with advances in technology and other factors and that improves efficiency that is not playing out right now. So, there is not any built up demand for wage inflation within the company. It's something that we watch country by country very carefully. You have any other question, Kai?

Yes, a follow-up just on pricing again. Is that how you position your broker colleagues in the potential changing market place. I should wonder if you can draw any comparison in the past if there is a big changes in market place, how would that impact your customer retention as well as the new business?

Yes, a couple of things. 1) It's interesting to note in every market, that is potentially hardening and I use the word potential year. If you look around the table, you got people who have seen hard markets and soft markets. Most of our careers have been in softer softening market environments, hard markets tend to be pretty swift. But ultimately on the underwriting side and on the booking side, we have a lot of people working for us who never experience a underwriter asking for a rate increase. You could have been in this business for decades and maybe not have ever heard those words. So, it will play itself out. My history in the business is people convert very quickly and it's all comparative in terms of how in achieving and broking the right individual arrange for a client. I think brokers can change very quickly and adaptive to changing market conditions. What it has meant to Marsh & McLennan in the past is generally been a higher levels, a moderately higher levels of prior retention in new business because of a slight equality. We got the broadest specialized placement capabilities in the world. And so, in times of stress, our phone rings more than in times that are easy. Next question, please?

And our next question comes from Jay Gelb with Barclays.

Thank you. Could you update us on enrollment for 2018 in the private health exchange?

Sure. Well, let me just talk a little bit about the marketplace in general because as we said before we liked our capabilities and we like our positioning and we expect Mercer marketplace 365 to be a contributor to Marsh's U.S. health and benefits business going forward. But it's important to understand it's still in the build stage for us and its one solution just one part of an overall tool kit that we use in giving Marsh capabilities in health to clients. And so, I'm not sure if we're going to go into much detail on it. And by the way for us it’s not really an exchange anymore. It's really a platform that is a year around benefits platform. But Julio, you want to add some more to that?

Thank you, Dan and thank you Jay for the question and good morning. Yes, we like to think of our Mercer market place 365 benefits offering as an all year around platform as Dan mentioned. It offers year round benefits like wellness along with the enrollment capability of how as well as voluntary benefits, life insurance, dental and other important coverages. And then 365 continues to be a relatively small part of a overall broad health portfolio. Focus continuous to be in finding the right solution to bend the cost curve on health for our clients. Yet, obviously at times when that is a good fit mainly Mercer market place 365 is a good fit. So, we continue to have confidence that we have a platform that we resonates with our client and it makes sense for some of them to take advantage of them. Mercer market place 365 had a good sales activity here this year and it will be helpful as we pivot to 2018 growth.

So, I feel that would agree with you. I think this is one of the things Jay, that in the past we said that this part of the business was getting too much attention and we thought some of the estimates that have been put out on the industry where we couldn't understand where the numbers were coming from. But ultimately giving things that's specific enrolment data number of lives, that sort of thing on a relatively small part of the subset of our business. This doesn't seem to make sense. So, let's just take it as Julio said they had a strong selling seasoned year which will benefit us in the future and I will leave it at that. You have another question, Jay?

That's just fine. Sure, yes. Just a separate question on Guy Carpenter. If we look at environment where it's likely to have some pricing improvement, maybe some increased demand for property related reinsurance covers. How much of a benefit could that be for Guy Carpenter either topline and earnings if you look at past cycles like 2011, 2005?

I mean, we one thing before I hand of to Peter. We built our business to prosper in times that are generally broad market relative level of softness in the market and then every once in a while there is a burst of activity in terms of heightening. But it certainly some of them are still brief, it's hard to refer to them as cycles, per se. And so, that we don’t look at our businesses as really operating under the basis of cycles. It's mainly almost all the way downward and then every once in a while there is a little spurt of something. And so, the other thing is both in Marsh and in Guy Carpenter, there is always a series of puts and takes in terms of how a company's responding and then I'll hand over to Peter. But I would imagine if the market is too tough, many well capitalized insurance, we just make different decisions, right? And so Peter you want to answer that?

I think that's right. And this is a business of puts and takes. And more importantly Jay, as I said in the last call we're building Guy Carpenter and delivered consistent growth there irrespective of market conditions. That means we're focused on building strong pipelines for new business and exercising continued discipline around our client service and retention. That we're not building a business that’s depended on rate environment.

Thanks. Next question, please?

And we'll take our next question from Jay Cohen with Bank of America Merrill Lynch.

Yes, thanks. Just one question on the consulting side and then the health practice. You said there were some I guess weakness or softness in the U.S. Can you talk about what is driving that?

Okay. So, a couple of things. You mentioned how practice and I would just -- I want to just add a little bit because I know some of our competitors actually have things that they view as they line up business. It's important to know we do a health business had made big business for us than we do it in three different places. I mean, clearly Mercer is a cornerstone of our health business. But all of the winding either a large health practice is well that's focused on different kinds of transformation. It doesn't overlap at all with Mercer's activity. And of course both Marsh and Marsh & McLennan agency have big positions in the employee health and benefits markets. So, it aggregates to a pretty big number and we have different ways of looking at it. But specifically I think you were referring to Mercer in this case. So, Julio why don’t you talk about the Mercer health business a little bit?

Thank you Dan and Jay thanks for the question as well. Good morning. Mercer overall has a pretty diversified and well balanced and geographically spread portfolio as you know. Over the past several quarters and several years, Mercer had delivered some pretty exceptional results in growth area. Now on a quarterly basis, as you can imagine things that some flows and puts and takes, this is why we speak -- like to speak about our growth over a longer period this time versus a particular quarter. In an event, let's take help as you mentioned as an example, our health business has pockets of good growth and some challenging areas, as an example our admin business which as you knows part of our health results continues to grow but go through a profitability improvement exercise which at times when contracts come up for renewal, obviously we take some pricing action sometimes they need sometimes they don’t but we are very focused on improving profitability. This makes it kind of a drag in some quarters on overall health growth. On the other hand, our commission brokers work, particularly in the U.S. remain strong with increases in retention as an example, uncertainty in the U.S. in particular has the way some decisions while others are starting to show some movement, so all that said we continue to invest in expanding our health business especially around acquisitions like content online or global proposition for health, a great platform that really is a competitive advantage for us and will pay off in the long run and of course our investments organically in most of marketplace 365.

Thanks Julio. JD, do you have something up?

No, that’s it. Thanks a lot guys.

Okay, thank you. Next question please.

And we'll take our next question from Larry Greenberg with Janney.

Hi, thank you. Just a quickie, I think earlier in the year you have indicated that some of the acquisitions you had done late last year were putting some pressure on margins in the first half of this year and you just needed to better scale to have those margins move up more in line with where you are. Can you just talk about that and whether there's still a bit of a drag from some of those deals that you did?

I'll take that Larry and then I will hand over to Mark to give you a little bit more but, there was a few things Mercer in particular acquired some companies at the very tail-end of last year that were more leaning toward higher growth technology based organizations so by their very definition have a little bit more dilution to them in the early stages but we respect their higher levels of growth to make up for that over time and make them good acquisitions and so it's a little bit different than some of the other businesses that we've acquired but Mark can add to that?

Larry, in the comments we have made, we were specifically consulting business and if you remember back to the first couple of quarters, we can talk about how the underlying performance of the business which [indiscernible] was just being masked by these acquisitions. And then you start to see that as the [indiscernible] left in the back half of the year are doing well but we have had if you just look at the headline gap growth numbers acquisitions have contributing quite a bit which is a good story, the thing you keep in mind and when we talked about this the acquisitions are ahead within the near term because we're the purchase accounting through our results. We think pretty substantial growth and intangible amortization while we were delivering this solid NOI growth but as you see in the back half of the year some of the headwinds we talked about and mentioned.

I'm glad that Mark mentioned the GAP revenue growth because I think it's important to look like and look at, the people who look at Marsh the 9% growth for an awfully big, high quality company in a given quarter that's going to benefit us enormously in coming years, sure it's not an underlying and we want to see better underlying growth but ultimately we were happy with that number. Do we have another question, Larry?

No, I am good. Thank you.

Next question please.

And we'll take our next question from Arash Soleimani with KBW.

Thanks, just a start off, I have quick question, you mentioned, closing the protection gap in flood and I'm just curious to get your thoughts on how meaningful the wakeup call you think the third quarter events could serve towards starting to bridge that gap?

It's a great question. It’s a U.S. question and it’s also a global question, the protection gap is meaningful if you look over decades of time, more catastrophe risk and in particular flood has been transferred to taxpayers in post event type of situation then actually insurance company through these transfer, the value that the private market bring, it’s enough sure was transferred private markets with their capital risk and offer risk modification recommendations and other invitees which tend to reduce level of losses over time and it is something happens when it's a government entity that is funding on a post lost basis through taxpayer dollars and so we hope it's a wakeup call but we're not -- we're just not sure about it. If you look at the situation where okay pre the series of loss events, U.S. policyholder surplus was at around $725 billion which was an all time record and at the same time premium to surplus ratios were lower than they've been in the last 25 years. So we have this capital that at the right prices available to apply against risk and then on the other hand you have situations like flood in the United States which we view as the principal risk facing our clients and there's just a mismatch. So we spent a lot of time talking about it and we will see where it goes over the time but we do think there needs to be more collective energy between the entire industry, long voices so I don't think to carry much weight in any capital. Any other questions?

Just one other quick question, I was just curious if you have any thoughts on the potential whether there would loss adjustment expense surprised sort to speak with what the catch in the third quarter. I know I can't have a claim operation I think older claims maybe that have some inside to provide, I am just curious to get your thoughts on the last number increasing on the LAE side.

LAE, it has to be more of a percentage of overall losses as opposed to anything else and I think that there may be some stretching of adjustment expenses only because you look at a series of catastrophe and the strain that puts on organizations like loss adjustment firms, contractors etcetera the costs tend to rise as the number of them available for the next job decreases and certainly the number of claims has been close to unprecedented in a very short period of time and so that in another itself put some strain on getting the right people to do the adjustment but I would say the industry itself steps up pretty well in the event of catastrophes and there's not much quibbling that is going on, it’s more of just getting the information and cutting a check and so from that standpoint I wouldn't expect no wrong drawn out process on property claims. Now on business interruption claim that’s a little bit different and so maybe that becomes more of an area but that would be sort of typical of what are expense adjustments are and loss adjustments are on a post catastrophe on BI claim. So we will see much in that area. Next question please.

And we'll take our next question from Dave Styblo with Jefferies.

Hi there, good morning, thanks for the question. I just want to come back to Mercer numbers in the third quarter here; I know you guys certainly always fun to looking at a trailing base year to date in that regard I guess the flat growth here is and about the slowest in the quarter that we've seen in quite some time and some of it sounds like it's a slowdown in project based work, I'm curious if there are any other factors that cause it to be flat this quarter? I know you had mentioned your colleagues were affected to some extent so did that, was that a factor in slowing down productivity? But just generally, three of the four businesses were slower year over year and as you look forward, do you guys have visibility on some of those businesses rebounding, coming back on at this point?

Sure, sure. No it's a good question and obviously something that we began to regulate, I would say a couple of things to start and then I will hand over to Julio, I think [indiscernible] heard over there like a comparator to last year because there was a zero in third quarter ’16 and 4% this time and Julio may have been willing to trade on that one could Mercer was 3% in the third of 2016, so I think that has some factor there and one of the reasons why I mean these are our clients businesses that have long kind of relationships to them and so looking quarter by quarter is really not the right way to look at the business, the way I look at the business is that on a year to date basis, Marsh & McLennan Companies has had a three which is exactly where we were on a year to date basis at the consolidated company last year. And if you recall going into this year, we sort of said our expectation was that 2017 would look a lot like 2016 and I think that has played itself out including the kind of margin expansion that we've seen in 70 BIPS [ph] year to date same as last year, year to date and when I look at the individual operating companies, I've got three operating companies up from last year and one operating company down on a year to date basis and so that that is just if I look at Marsh is at three versus a two, [indiscernible] four versus two, OW is at six versus three and Mercer is two versus a three, in the overall mix that is not an unusual year from us, we will have a different outcome on that mix each time but ultimately we rarely have all four up goes up at the same time and then there is usually some variability but Julio get, do you want add a little briefly to that?

Yes. Thank you for the question. As I mentioned earlier on any given quarter we can have some adds and flows and puts and takes in the business. As an example when we talk a little bit about a wealth, Mercer had continue to grow earnings and new offerings in wealth business. We also continue to make acquisitions, not just in wealth but in other areas like contents online, [indiscernible] solutions which we think will serve us well on growth a well into the future. On the wealthy area, you've heard me speak about the continued double digit growth success that we're having in our investment management delegate solutions and in fact we surpass 230 billion of assets under delegated management which further certifies our industry position. Now in the wealth business, you also have the VB consulting actuarial business, so you have an offset in the total growth trajectory because that is a business which we all know is under pressure and it is mostly to do with the decreasing VB program and then in addition to that impact of less project work around cash out and buy out has impacted this quarter. So things like that again will be adds and flows, puts and take when everything is said and done Marsh has done a pretty good job of being able to get growth both organically and inorganic investments pointing to growth and we expect that to continue with refute. Since we're on the consulting segment, I just want to take a moment because all of the lining while volatile, having more volatility than the other of course had been able to outgrow the other outgrows over a longer stretch of time and had a decent quarter on the topline this quarter at 7%. But Scott, do you want to talk a little bit about growth in OW?

Sure, thanks Dan. We had a what I describe as a good quarter, with strong growth across most areas of the portfolio. It was particularly strong in the public sector or actuarial business and in our health business. We alternate really strong growth in our growth markets in particular Asia and the Middle East. And I think we could grow even faster than this. What's held us back in the third quarter from stronger growth is Europe, still remains a little sluggish and it's a overall demand for consultant, our branding business was a little weak given the up level in global branding. And we're still managing out transition in our big financial services business from regulatory to more strategic work. But in all three of those areas we feel some momentum, if anything market demand is picking up as global growth seems to be picking up at least modestly, and our medium term targets to have growth in mid to high single digits are fully intact.

Thanks, got it. That's great color on that.

Dave, David. Yes, anything else, David?

I did, I don’t want to beat the rates the rates earning to depth here as you guys are talking about how uncertain it is at this point. But I'm wondering maybe as a history lesson, it seems like 2005 is the most common parallel. I'm wondering if you guys could just talk a little bit about the parallels or differences that you can draw from a national disaster that impacted your business back then. How they might be different or similar to the one that are affecting it now. And I'm just trying to think of things we might not be considering such as supply of capital is a lot more robust. But are there other factors that you would point us to say "Hey, this is what you should be thinking about as you frame the impact of the industry."

I think there's just too many moving parts here, David. In fact, in your last comments in terms of the number of capital providers or the supplied capital, you think about where the market was in 2005 versus where it is in 2017. It's a completely different situation. The number of insurance companies that right more than a billion dollars of premium as an example in the United States. The level of improvement on data and analytics, it really means that any emergent, frankly after things like KRW of alternative capital in the growth in alternative capital and other ways of companies dealing with risk transfer off of primary markets into the reinsurance market. I mean, there are many moving parts there. I would say that certain insurance companies have been hit pretty hard. Policy holders' surplus getting wacked in the double digits and those insurance companies are going to be seeking rate. And they are going to be seeking rate probably everywhere that they issue a policy. And so, then the question becomes well what will other insurance companies do. Will they use this opportunity as a way to slot in somewhere beneath the incumbent as a way to grow their share in this time because they may not have been heard as badly. Now, this is a global market. If you look at the top 20 insurance companies, many of them are global but it's also a local market and a regional market. So, as John was saying earlier, the idea that in some country in Latin America or Asia, the casualty pricing will go up as a result of loss activity in the United States when there is so many regional and local champions to take the account if rates go up too high in those areas. That puts a lot of competitive pressure aware the terms of conditions will ultimately outlines that. We love to give you more but this is where our market place operates. And the losses are still being developed as we were saying earlier, the model numbers are far higher than what the aggregate reported numbers are. So, either the modelers are incorrect right now or the actual reported numbers are too low and will rise over time which will put more pressure on rating levels. We'll just have to see how it plays out. Next question please?

And we'll take our next question from Paul Newsome with Sandler O'Neill.

Good morning. Just a couple of little simple questions, I think. I want to ask you about the discreet tax items and sort of the sustainability of those discreet items over time?

Sure, so Mark?

Yes, sure. Paul, we've been dealing with all here. There is this required accounting change related to stock based compensation which has big impact in our first quarter which we quantified in less impact and subsequence. So, we did have a few discreet item that affected our adjusted tax rate. But that tax accounting change was the largest and it is unpredictable just based on option exercise activity and when stock based. So, that will be something going forward. That accounting changes is permanent if you will and we will have option exercises and equity based compensation at best. But the amount of that volume is going to be a little bit volatile, depends on our stock price and when people actually take the action. That was the largest discreet item in the quarter.

Well, that makes a lot of sense. And then my second question. Just if there's any update on your thoughts about the revenue accounting change perspectively, how we should be thinking about that when we're thinking about earnings estimates for 2018?

Yes, and it's still too early to give you. First, I'd have to give a little bit of color. It is a as you can appreciate beyond our industry of the company dealing with this pretty comprehensive change to revenue recognition. And it is going to have a meaningful impact on the timing of not only our revenue recognition but the earnings pattern as well. So, I'll give you a little bit but it won't be till later in the year when we can give you a specific. So, there will be an impact on the timing of revenue in RIS for us more so than consulting. Most of the action we expect will be across the quarters, within our year most of our contracts are fairly short term in nature. In Guy Carpenter for instance, there'll be an acceleration of revenue and a core to share business and some of our trading business. In March we'll have some acceleration, some fee based business and a couple of other areas. But again most of the action among quarters or cross quarters within a year is opposed to the past years. Both of our segment, there is also the element of this which I'll show you, pretty sure that involves the furl of expenses that will affect both of our segments. And in most of the impact there again would expect cross quarters within the year as opposed to cross there but there will be certain elements or categories with expense that will have amortization periods that will spend a year. So, it is comprehensive, and as said we get through the last part of the year we'll have more specificity for you. And our goal through all of this, I mean as I said would be a meaningful change our goal be to try to provide a much transparency as possible so you can baseline the results as accurately as you can and at least get a sense of underlying performance.

I'm still wondering if this is something what we do talking about in December right before we get into the earnings announcements or if you look come earlier than that. Just from a mechanical perspective and setting expectations for quarters.

Yes. I think at this point forward, still uncertain I mean certainly between now in our Q4 earnings call we like we will not say anything.

Okay, well. I'd like to draw the call to a close and thank everybody on the call this morning for joining us today. I'd like to thank our clients for their support and our colleagues for their hard work and dedication and serving them. Have a good day everyone. Thank you.

And that does conclude today's conference. Thank you for your participation. You may now disconnect.