Marsh & McLennan Cos., the insurance broker that hired Bermudian Brian Duperreault as chief executive officer last month, said fourth-quarter profit fell 62 percent on higher expenses including employee compensation.

Net income declined to $85 million, or 16 cents a share, from $226 million, or 40 cents, in the same period a year earlier, the New York-based company said in a statement yesterday. Profit excluding discontinued operations and one-time costs was 26 cents a share, missing the 31-cent average estimate of 13 analysts surveyed by Bloomberg.

Mr. Duperreault was hired to boost sales at Marsh & McLennan, the world's largest brokerage, as falling rates for commercial insurance translate into smaller commissions for arranging deals. Predecessor Michael Cherkasky, hired after a 2004 bid-rigging probe, was unable to regain lost clients and revenue, and spent more on bonuses for brokers. Cherkasky's own departure cost the company about two cents a share in the quarter.

"Investors will probably be willing to look beyond any negative operational news and place a greater value on an expectation for higher future earnings power," said analyst William Wilt of Morgan Stanley in a note to investors before the results were released. Wilt raised his rating on the shares to overweight after Duperreault was hired.

Marsh & McLennan has fallen 14 percent in the past year.

The price of business policies in the US fell 12 percent in the fourth quarter as insurers cut prices to take market share, according to a survey by the Council of Insurance Agents and Brokers.

Revenue at the company's Marsh Inc. insurance brokerage grew by about 1 percent excluding the effects of currency fluctuations and acquisitions, compared with a 2 percent increase at No. 2 Aon Corp. and stagnant revenue at Willis Group Holdings Ltd. on that basis.

Marsh & McLennan had the most broking and consulting revenue in 2006, according to Business Insurance magazine, ahead of Aon, based in Chicago, and third-ranked Willis, of London.