Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 26, 2021 | |
Cover [Abstract] | ||
Amendment Flag | false | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | WILLIS TOWERS WATSON PLC | |
Entity Central Index Key | 0001140536 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 128,976,752 | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Trading Symbol | WLTW | |
Title of 12(b) Security | Ordinary Shares, nominal value $0.000304635 per share | |
Security Exchange Name | NASDAQ | |
Entity File Number | 001-16503 | |
Entity Incorporation, State or Country Code | L2 | |
Entity Tax Identification Number | 98-0352587 | |
Entity Address, Address Line One | c/o Willis Group Limited | |
Entity Address, Address Line Two | 51 Lime Street | |
Entity Address, City or Town | London | |
Entity Address, Country | GB | |
Entity Address, Postal Zip Code | EC3M 7DQ | |
City Area Code | 011 | |
Local Phone Number | 44-20-3124-6000 | |
Document Quarterly Report | true | |
Document Transition Report | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Revenue | $ 2,590 | $ 2,466 |
Costs of providing services | ||
Salaries and benefits | 1,523 | 1,394 |
Other operating expenses | 417 | 484 |
Depreciation | 71 | 98 |
Amortization | 103 | 121 |
Transaction and integration expenses | 24 | 9 |
Total costs of providing services | 2,138 | 2,106 |
Income from operations | 452 | 360 |
Interest expense | (59) | (61) |
Other income, net | 439 | 92 |
INCOME FROM OPERATIONS BEFORE INCOME TAXES | 832 | 391 |
Provision for income taxes | (96) | (78) |
NET INCOME | 736 | 313 |
Income attributable to non-controlling interests | (3) | (8) |
NET INCOME ATTRIBUTABLE TO WILLIS TOWERS WATSON | $ 733 | $ 305 |
EARNINGS PER SHARE | ||
Basic earnings per share | $ 5.64 | $ 2.36 |
Diluted earnings per share | $ 5.63 | $ 2.34 |
Comprehensive income before non-controlling interests | $ 786 | $ 93 |
Comprehensive income attributable to non-controlling interests | (5) | (7) |
Comprehensive income attributable to Willis Towers Watson | $ 781 | $ 86 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
ASSETS | ||
Cash and cash equivalents | $ 1,960 | $ 2,089 |
Fiduciary assets | 15,911 | 15,160 |
Accounts receivable, net | 2,569 | 2,555 |
Prepaid and other current assets | 432 | 497 |
Total current assets | 20,872 | 20,301 |
Fixed assets, net | 951 | 1,014 |
Goodwill | 10,986 | 11,204 |
Other intangible assets, net | 2,878 | 3,043 |
Right-of-use assets | 841 | 902 |
Pension benefits assets | 991 | 971 |
Other non-current assets | 1,113 | 1,096 |
Total non-current assets | 17,760 | 18,230 |
TOTAL ASSETS | 38,632 | 38,531 |
LIABILITIES AND EQUITY | ||
Fiduciary liabilities | 15,911 | 15,160 |
Deferred revenue and accrued expenses | 1,526 | 2,161 |
Current debt | 471 | 971 |
Current lease liabilities | 147 | 152 |
Other current liabilities | 965 | 888 |
Total current liabilities | 19,020 | 19,332 |
Long-term debt | 4,632 | 4,664 |
Liability for pension benefits | 1,278 | 1,405 |
Deferred tax liabilities | 576 | 561 |
Provision for liabilities | 390 | 407 |
Long-term lease liabilities | 857 | 918 |
Other non-current liabilities | 305 | 312 |
Total non-current liabilities | 8,038 | 8,267 |
TOTAL LIABILITIES | 27,058 | 27,599 |
COMMITMENTS AND CONTINGENCIES | 0 | 0 |
EQUITY | ||
Additional paid-in capital | 10,765 | 10,748 |
Retained earnings | 3,075 | 2,434 |
Accumulated other comprehensive loss, net of tax | (2,311) | (2,359) |
Treasury shares, at cost, 17,519 shares in 2021 and 2020 | (3) | (3) |
Total Willis Towers Watson shareholders’ equity | 11,526 | 10,820 |
Non-controlling interests | 48 | 112 |
Total equity | 11,574 | 10,932 |
TOTAL LIABILITIES AND EQUITY | $ 38,632 | $ 38,531 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Preference shares, nominal value (USD per share) | $ 0.000115 | $ 0.000115 |
Preference shares, shares authorized | 1,000,000,000 | 1,000,000,000 |
Preference shares, shares issued | 0 | 0 |
Ordinary shares, $0.000304635 nominal value [Member] | ||
Ordinary shares, nominal value | $ 0.000304635 | $ 0.000304635 |
Ordinary shares, shares authorized | 1,510,003,775 | 1,510,003,775 |
Ordinary shares, shares issued | 128,974,389 | 128,964,579 |
Ordinary shares, shares outstanding | 128,974,389 | 128,964,579 |
Treasury shares | 17,519 | 17,519 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
CASH FLOWS (USED IN)/FROM OPERATING ACTIVITIES | |||
NET INCOME | $ 736 | $ 313 | |
Adjustments to reconcile net income to total net cash from operating activities: | |||
Depreciation | 71 | 98 | |
Amortization | 103 | 121 | |
Non-cash lease expense | 37 | 34 | |
Net periodic benefit of defined benefit pension plans | (42) | (46) | |
Provision for doubtful receivables from clients | 8 | 24 | |
Provision for/(benefit from) deferred income taxes | 10 | (23) | |
Share-based compensation | 27 | (1) | |
Net gain on disposal of operations | (359) | 0 | |
Non-cash foreign exchange gain | (2) | (12) | |
Other, net | (24) | 23 | |
Changes in operating assets and liabilities, net of effects from purchase of subsidiaries: | |||
Accounts receivable | (115) | (46) | |
Fiduciary assets | (1,784) | (2,873) | |
Fiduciary liabilities | 1,784 | 2,873 | |
Other assets | (15) | 7 | |
Other liabilities | (556) | (482) | |
Provisions | (7) | 13 | |
Net cash (used in)/from operating activities | (128) | 23 | |
CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES | |||
Additions to fixed assets and software for internal use | (37) | (66) | |
Capitalized software costs | (14) | (15) | |
Acquisitions of operations, net of cash acquired | 0 | (66) | |
Net proceeds from sale of operations | 696 | 0 | |
Other, net | 0 | (15) | |
Net cash from/(used in) investing activities | 645 | (162) | |
CASH FLOWS (USED IN)/FROM FINANCING ACTIVITIES | |||
Net borrowings on revolving credit facility | 0 | 396 | |
Repayments of debt | (508) | (128) | |
Proceeds from issuance of shares | 1 | 3 | |
Payments of deferred and contingent consideration related to acquisitions | (17) | 0 | |
Dividends paid | (92) | (84) | |
Acquisitions of and dividends paid to non-controlling interests | (17) | (1) | |
Net cash (used in)/from financing activities | (633) | 186 | |
(DECREASE)/INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (116) | 47 | |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (14) | (36) | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD | [1] | 2,096 | 895 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | [1] | $ 1,966 | $ 906 |
[1] | As a result of the acquired TRANZACT collateralized facility, cash, cash equivalents and restricted cash included $6 million and $7 million of restricted cash at March 31, 2021 and December 31, 2020, respectively, which is included within prepaid and other current assets on our condensed consolidated balance sheets. There was $8 million of restricted cash held at March 31, 2020 and December 31, 2019. |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Restricted cash | $ 6 | $ 7 |
Prepaid Expenses and Other Current Assets [Member] | Tranzact Collateralized Facility [Member] | ||
Restricted cash | $ 6 | $ 7 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Changes in Equity (Unaudited) - USD ($) shares in Thousands, $ in Millions | Total | Shares outstanding [Member] | Ordinary shares and APIC [Member] | Retained earnings [Member] | Treasury shares [Member] | AOCL [Member] | [1] | Total WTW shareholders' equity [Member] | Non-controlling interests [Member] | |
Equity, beginning balance at Dec. 31, 2019 | $ 10,369 | $ 10,687 | $ 1,792 | $ (3) | $ (2,227) | $ 10,249 | $ 120 | |||
Equity, beginning balance (in shares) at Dec. 31, 2019 | 128,690 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 313 | 305 | 305 | 8 | ||||||
Dividends declared | (88) | (88) | (88) | |||||||
Dividends attributable to non-controlling interests | (1) | (1) | ||||||||
Other comprehensive (loss) gain | (220) | (219) | (219) | (1) | ||||||
Issuance of shares under employee stock compensation plans | 3 | 3 | 3 | |||||||
Issuance of shares under employee stock compensation plans (in shares) | 36 | |||||||||
Share-based compensation and net settlements | 9 | 9 | 9 | |||||||
Foreign currency translation | 4 | 4 | 4 | |||||||
Equity, ending balance at Mar. 31, 2020 | 10,389 | 10,703 | 2,009 | (3) | (2,446) | 10,263 | 126 | |||
Equity, ending balance (in shares) at Mar. 31, 2020 | 128,726 | |||||||||
Equity, beginning balance at Dec. 31, 2020 | 10,932 | 10,748 | 2,434 | (3) | (2,359) | 10,820 | 112 | |||
Equity, beginning balance (in shares) at Dec. 31, 2020 | 128,965 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 736 | 733 | 733 | 3 | ||||||
Dividends declared | (92) | (92) | (92) | |||||||
Dividends attributable to non-controlling interests | (17) | (17) | ||||||||
Other comprehensive (loss) gain | 50 | 48 | 48 | 2 | ||||||
Issuance of shares under employee stock compensation plans | 1 | 1 | 1 | |||||||
Issuance of shares under employee stock compensation plans (in shares) | 9 | |||||||||
Share-based compensation and net settlements | 12 | 12 | 12 | |||||||
Reduction of non-controlling interests | [2] | (52) | (52) | |||||||
Foreign currency translation | 4 | 4 | 4 | |||||||
Equity, ending balance at Mar. 31, 2021 | $ 11,574 | $ 10,765 | $ 3,075 | $ (3) | $ (2,311) | $ 11,526 | $ 48 | |||
Equity, ending balance (in shares) at Mar. 31, 2021 | 128,974 | |||||||||
[1] | Accumulated other comprehensive loss, net of tax (‘AOCL’). | |||||||||
[2] | Attributable to the divestiture of our less than wholly-owned Miller subsidiary. |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Changes in Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement Of Stockholders Equity [Abstract] | ||
Dividends declared per share | $ 0.71 | $ 0.68 |
Nature of Operations
Nature of Operations | 3 Months Ended |
Mar. 31, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Nature of Operations | Note 1 — Nature of Operations Willis Towers Watson plc is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. The Company has more than 46,000 employees and services clients in more than 140 countries. We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals. Our risk management services include strategic risk consulting (including providing actuarial analysis), a variety of due diligence services, the provision of practical on-site risk control services (such as health and safety and property loss control consulting), and analytical and advisory services (such as hazard modeling and reinsurance optimization studies). We also assist our clients with planning for addressing incidents or crises when they occur. These services include contingency planning, security audits and product tampering plans. We help our clients enhance business performance by delivering consulting services, technology and solutions that optimize benefits and cultivate talent. Our services and solutions encompass such areas as employee benefits, total rewards, talent and benefits outsourcing. In addition, we provide investment advice to help our clients develop disciplined and efficient strategies to meet their investment goals and expand the power of capital. As an insurance broker, we act as an intermediary between our clients and insurance carriers by advising on their risk management requirements, helping them to determine the best means of managing risk and negotiating and placing insurance with insurance carriers through our global distribution network. We operate a private Medicare marketplace in the U.S. through which, along with our active employee marketplace, we help our clients move to a more sustainable economic model by capping and controlling the costs associated with healthcare benefits. We also provide direct-to-consumer sales of Medicare coverage. We are not an insurance company, and therefore we do not underwrite insurable risks for our own account. We believe our broad perspective allows us to see the critical intersections between talent, assets and ideas - the dynamic formula that drives business performance. Proposed Combination with Aon plc On March 9, 2020, WTW and Aon plc (‘Aon’) issued an announcement disclosing that the respective boards of directors of WTW and Aon had reached agreement on the terms of a recommended acquisition of WTW by Aon. Under the terms of the agreement each WTW shareholder will receive 1.08 Aon ordinary shares for each WTW ordinary share. At the time of the announcement, it was estimated that upon completion of the combination, existing Aon shareholders will own approximately 63% and existing WTW shareholders will own approximately 37% of the combined company on a fully diluted basis. The transaction was approved by the shareholders of both WTW and Aon during meetings of the respective shareholders held on August 26, 2020 and remains subject to other customary closing conditions, including required regulatory approvals. The antitrust regulatory review of the transaction remains ongoing. In addition, there are numerous other regulatory approvals and other closing conditions that need to be met. The parties expect the transaction to close by the end of the first half of 2021, subject to satisfaction of these conditions. |
Basis of Presentation and Recen
Basis of Presentation and Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Recent Accounting Pronouncements | Note 2 Basis of Presentation The accompanying unaudited quarterly condensed consolidated financial statements of Willis Towers Watson and our subsidiaries are presented in accordance with the rules and regulations of the SEC for quarterly reports on Form 10-Q and therefore do not include all of the information and footnotes required by U.S. GAAP. In the opinion of management, these condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, which are necessary for a fair presentation of the condensed consolidated financial statements and results for the interim periods. All intercompany accounts and transactions have been eliminated in consolidation. The condensed consolidated financial statements should be read together with the Company’s Annual Report on Form 10-K, filed with the SEC on February 23, 2021, and may be accessed via EDGAR on the SEC’s web site at www.sec.gov. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results that can be expected for the entire year. The Company experiences seasonal fluctuations of its revenue. Revenue is typically higher during the Company’s first and fourth quarters due primarily to the timing of broking-related activities. The results reflect certain estimates and assumptions made by management, including those estimates used in calculating acquisition consideration and fair value of tangible and intangible assets and liabilities, professional liability claims, estimated bonuses, valuation of billed and unbilled receivables, and anticipated tax liabilities that affect the amounts reported in the condensed consolidated financial statements and related notes. Risks and Uncertainties Related to the COVID-19 Pandemic The COVID-19 pandemic has had an adverse impact on global commercial activity, including the global supply chain, and has contributed to significant volatility in the global financial markets including, among other effects, occasional declines in the equity markets, changes in interest rates and reduced liquidity on a global basis. With regard to the effects on our own business operations and those of our clients, suppliers and other third parties with whom we interact, the Company has regularly considered the impact of COVID-19 on our business, taking into account our business resilience and continuity plans, financial modeling and stress testing of liquidity and financial resources. Generally, the COVID-19 pandemic did not have a material adverse impact on our overall financial results during 2020 or on our results for the first quarter of 2021; however, during 2020 and through the first quarter of 2021, the COVID-19 pandemic continues to negatively impact our revenue growth, primarily in our businesses that are discretionary in nature. We believe such level of impact will continue through much of 2021, at least until a sufficient portion of the populations in jurisdictions where we do business have been vaccinated and social-distancing orders are lessened or lifted. As part of the significant estimates and assumptions that are inherent in our financial statements, we have considered the impact COVID-19 will have on our client behavior and the economic environment looking forward for the remainder of 2021 and throughout the geographies in which we operate. These estimates and assumptions include the collectability of billed and unbilled receivables, the estimation of revenue, and the fair value of our reporting units, tangible and intangible assets and contingent consideration. With regard to collectability of receivables, we believe we may continue to face atypical delays in client payments going forward. The demand for certain discretionary lines of business has decreased, and we believe that decrease may continue to impact our financial results in succeeding periods. Non-discretionary lines of business have also been, to some extent, adversely affected and may be adversely affected in the future. Further, reduced economic activity or disruption in insurance markets could reduce the demand for or the extent of insurance coverage. For example, we have seen instances where the reduced demand for air travel has reduced the extent of insurance coverage needed. Also, the increased frequency and severity of coverage disputes between our clients and (re)insurers arising out of the pandemic could increase our professional liability risk. We will continue to monitor the situation and assess any implications to our business and our stakeholders. The extent to which COVID-19 impacts our business and financial position will depend on future developments, which are difficult to predict. These future developments may include the severity and scope of the COVID-19 outbreak, which may unexpectedly change or worsen, and the types and duration of measures imposed by governmental authorities to contain the virus or address its impact. We continue to expect that the COVID-19 pandemic will negatively impact our revenue and operating results in fiscal 2021. We believe that these trends and uncertainties are similar to those faced by other comparable registrants as a result of the pandemic. Recent Accounting Pronouncements Adopted In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes |
Divestitures
Divestitures | 3 Months Ended |
Mar. 31, 2021 | |
Dispositions [Abstract] | |
Divestitures | Note 3 Miller Divestiture On March 1, 2021, the Company completed the transaction to sell its U.K.-based, majority-owned wholesale subsidiary Miller for final total consideration of GBP 623 million ($818 million), which includes amounts paid to the minority shareholder. The $356 million net tax-exempt gain on the sale was included in Other income, net in the condensed consolidated statement of comprehensive income during the three months ended March 31, 2021. Prior to disposal, Miller was included within the Investment, Risk and Reinsurance segment. Max Matthiessen Divestiture In September 2020, the Company completed the transaction to sell its Swedish majority-owned subsidiary MM Holding AB (‘Max Matthiessen’) for total consideration of SEK 2.3 billion ($262 million) plus certain other adjustments, resulting in a tax-exempt gain on the sale of $86 million, which was included in Other income, net in the consolidated statement of comprehensive income during the year ended December 31, 2020. Of the total consideration, the Company financed a SEK 600 million ($ 68 million) note repayable by the purchaser. The note has no fixed term but is repayable subject to certain terms and conditions and bears an interest rate that could range from 5 % to 10 %, increasing the longer the note remains outstanding. This note receivable is included in Other non-current assets in the condensed consolidated balance sheet. Prior to disposal, Max Matthiessen was included within the Investment, Risk and Reinsurance segment . |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2021 | |
Revenue From Contract With Customer [Abstract] | |
Revenue | Note 4 Disaggregation of Revenue The Company reports revenue by segment in Note 5 — Three Months Ended March 31, HCB CRB IRR BDA Corporate ( i ) Total 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 Broking $ 97 $ 83 $ 717 $ 648 $ 412 $ 433 $ 152 $ 98 $ — $ — $ 1,378 $ 1,262 Consulting 594 582 44 47 123 93 — — 2 2 763 724 Outsourced administration 132 128 25 25 4 3 132 133 — — 293 289 Other 49 47 4 1 65 83 — — 1 1 119 132 Total revenue by service offering 872 840 790 721 604 612 284 231 3 3 2,553 2,407 Reimbursable expenses and other ( i ) 11 15 — — 1 3 2 3 (5 ) 6 9 27 Total revenue from customer contracts $ 883 $ 855 $ 790 $ 721 $ 605 $ 615 $ 286 $ 234 $ (2 ) $ 9 $ 2,562 $ 2,434 Interest and other income (ii) 3 10 20 18 1 3 3 — 1 1 28 32 Total revenue $ 886 $ 865 $ 810 $ 739 $ 606 $ 618 $ 289 $ 234 $ (1 ) $ 10 $ 2,590 $ 2,466 ______________ ( i ) Reimbursable expenses and other, as well as Corporate revenue, are excluded from segment revenue, but included in total revenue on the condensed consolidated statements of comprehensive income. Amounts included in Corporate revenue may include eliminations and impacts from hedged revenue transactions. ( i i ) Interest and other income is included in segment revenue and total revenue, however it has been presented separately in the above tables because it does not arise directly from contracts with customers. Individual revenue streams aggregating to approximately 5% of total revenue from customer contracts for the three months ended March 31, 2021 and 2020 have been included within the Other line in the tables above. The following table presents revenue by the geography where our work is performed for the three months ended March 31, 2021 and 2020. The reconciliation to total revenue on our condensed consolidated statement of comprehensive income and to segment revenue is shown in the table above. Three Months Ended March 31, HCB CRB IRR BDA Corporate Total 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 North America $ 468 $ 476 $ 247 $ 233 $ 186 $ 170 $ 282 $ 229 $ 2 $ 2 $ 1,185 $ 1,110 Great Britain 147 126 155 137 311 321 — — — — 613 584 Western Europe 171 156 261 244 59 76 — — 1 1 492 477 International 86 82 127 107 48 45 2 2 — — 263 236 Total revenue by geography $ 872 $ 840 $ 790 $ 721 $ 604 $ 612 $ 284 $ 231 $ 3 $ 3 $ 2,553 $ 2,407 Contract Balances The Company reports accounts receivable, net on the condensed consolidated balance sheet, which includes billed and unbilled receivables and current contract assets. In addition to accounts receivable, net, the Company had the following non-current contract assets and deferred revenue balances at March 31, 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Billed receivables, net of allowance for doubtful accounts of $44 million and $41 million $ 1,727 $ 1,697 Unbilled receivables 508 445 Current contract assets 334 413 Accounts receivable, net $ 2,569 $ 2,555 Non-current accounts receivable, net $ 22 $ 34 Non-current contract assets $ 380 $ 329 Deferred revenue $ 620 $ 549 During the three months ended March 31, 2021, revenue of approximately $275 million was recognized that was reflected as deferred revenue at December 31, 2020. During the three months ended March 31, 2021, the Company recognized revenue of approximately $23 million related to performance obligations satisfied in a prior period. Performance Obligations The Company has contracts for which performance obligations have not been satisfied as of March 31, 2021 or have been partially satisfied as of this date. The following table shows the expected timing for the satisfaction of the remaining performance obligations. This table does not include contract renewals or variable consideration, which was excluded from the transaction prices in accordance with the guidance on constraining estimates of variable consideration. In addition, in accordance with ASC 606, Revenue From Contracts With Customers • Performance obligations which are part of a contract that has an original expected duration of less than one year, and • Performance obligations satisfied in accordance with ASC 606-10-55-18 (‘right to invoice’). Remainder of 2021 2022 2023 onward Total Revenue expected to be recognized on contracts as of March 31, 2021 $ 429 $ 426 $ 476 $ 1,331 Since most of the Company’s contracts are cancellable with less than one year’s notice, and have no substantive penalty for cancellation, the majority of the Company’s remaining performance obligations as of March 31, 2021 have been excluded from the table above. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Note 5 Willis Towers Watson has four reportable operating segments or business areas: • Human Capital and Benefits (‘HCB’) • Corporate Risk and Broking (‘CRB’) • Investment, Risk and Reinsurance (‘IRR’) • Benefits Delivery and Administration (‘BDA’) Willis Towers Watson’s chief operating decision maker is its chief executive officer. We determined that the operational data used by the chief operating decision maker is at the segment level. Management bases strategic goals and decisions on these segments and the data presented below is used to assess the adequacy of strategic decisions and the methods of achieving these strategies and related financial results. Management evaluates the performance of its segments and allocates resources to them based on net operating income on a pre-tax basis. The Company experiences seasonal fluctuations of its revenue. Revenue is typically higher during the Company’s first and fourth quarters due primarily to the timing of broking-related activities. The following table presents segment revenue and segment operating income for our reportable segments for the three months ended March 31, 2021 and 2020. Three Months Ended March 31, HCB CRB IRR BDA Total 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 Segment revenue $ 875 $ 850 $ 810 $ 739 $ 605 $ 615 $ 287 $ 231 $ 2,577 $ 2,435 Segment operating income/(loss) $ 220 $ 213 $ 162 $ 127 $ 290 $ 277 $ 7 $ (11 ) $ 679 $ 606 The following table presents a reconciliation of the information reported by segment to the Company’s condensed consolidated statement of comprehensive income amounts reported for the three months ended March 31, 2021 and 2020. Three Months Ended March 31, 2021 2020 Revenue: Total segment revenue $ 2,577 $ 2,435 Reimbursable expenses and other 13 31 Revenue $ 2,590 $ 2,466 Total segment operating income $ 679 $ 606 Amortization (103 ) (121 ) Transaction and integration expenses ( i ) (24 ) (9 ) Unallocated, net (ii) (100 ) (116 ) Income from operations 452 360 Interest expense (59 ) (61 ) Other income, net 439 92 Income from operations before income taxes $ 832 $ 391 ( i ) Includes mainly transaction costs related to the proposed Aon combination. (ii) Includes certain costs, primarily related to corporate functions which are not directly related to the segments, and certain differences between budgeted expenses determined at the beginning of the year and actual expenses that we report for U.S. GAAP purposes. The Company does not currently provide asset information by reportable segment as it does not routinely evaluate the total asset position by segment. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 6 — Income Taxes Provision for income taxes for the three months ended March 31, 2021 was $96 million compared to $78 million for the three months ended March 31, 2020. The effective tax rate was 11.5% for the three months ended March 31, 2021 and 20.0% for the three months ended March 31, 2020. These effective tax rates are calculated using extended values from our condensed consolidated statements of comprehensive income and are therefore more precise tax rates than can be calculated from rounded values. The current quarter effective tax rate was lower primarily due to the tax-exempt disposal of our Miller business. The Company recognizes deferred tax balances related to the undistributed earnings of subsidiaries when it expects that it will recover those undistributed earnings in a taxable manner, such as through receipt of dividends or sale of the investments. Historically, we have not provided taxes on cumulative earnings of our subsidiaries that have been reinvested indefinitely. As a result of our plans to restructure or distribute accumulated earnings of certain foreign operations, we have recorded an estimate of foreign withholding and state income taxes. However, we assert that the historical cumulative earnings of our other subsidiaries are reinvested indefinitely, and therefore do not provide deferred tax liabilities on these amounts. The Company records valuation allowances against net deferred tax assets based on whether it is more likely than not that the deferred tax assets will be realized. We have liabilities for uncertain tax positions under ASC 740 of $49 million, excluding interest and penalties. The Company believes the outcomes that are reasonably possible within the next 12 months may result in a reduction in the liability for uncertain tax positions of approximately $4 million to $8 million, excluding interest and penalties. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 7 The components of goodwill are outlined below for the three months ended March 31, 2021: HCB CRB IRR BDA Total Balance at December 31, 2020: Goodwill, gross $ 4,346 $ 2,378 $ 1,694 $ 3,278 $ 11,696 Accumulated impairment losses (130 ) (362 ) — — (492 ) Goodwill, net - December 31, 2020 4,216 2,016 1,694 3,278 11,204 Goodwill disposals — — (188 ) — (188 ) Foreign exchange (17 ) (16 ) 3 — (30 ) Balance at March 31, 2021: Goodwill, gross 4,329 2,362 1,509 3,278 11,478 Accumulated impairment losses (130 ) (362 ) — — (492 ) Goodwill, net - March 31, 2021 $ 4,199 $ 2,000 $ 1,509 $ 3,278 $ 10,986 Other Intangible Assets The following table reflects changes in the net carrying amounts of the components of finite-lived intangible assets for the three months ended March 31, 2021: Client relationships Software Trademark and trade name Other Total Balance at December 31, 2020: Intangible assets, gross $ 4,065 $ 761 $ 1,054 $ 108 $ 5,988 Accumulated amortization (2,031 ) (659 ) (220 ) (35 ) (2,945 ) Intangible assets, net - December 31, 2020 2,034 102 834 73 3,043 Intangible asset disposals (46 ) — (8 ) — (54 ) Amortization (69 ) (19 ) (11 ) (4 ) (103 ) Foreign exchange (10 ) — — 2 (8 ) Balance at March 31, 2021: Intangible assets, gross 3,865 759 1,040 110 5,774 Accumulated amortization (1,956 ) (676 ) (225 ) (39 ) (2,896 ) Intangible assets, net - March 31, 2021 $ 1,909 $ 83 $ 815 $ 71 $ 2,878 The weighted-average remaining life of amortizable intangible assets at March 31, 2021 was 13.4 years. The table below reflects the future estimated amortization expense for amortizable intangible assets for the remainder of 2021 and for subsequent years: Amortization Remainder of 2021 $ 268 2022 308 2023 257 2024 224 2025 205 Thereafter 1,616 Total $ 2,878 |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Note 8 We are exposed to certain foreign currency risks. Where possible, we identify exposures in our business that can be offset internally. Where no natural offset is identified, we may choose to enter into various derivative transactions. These instruments have the effect of reducing our exposure to unfavorable changes in foreign currency rates. The Company’s board of directors reviews and approves policies for managing this risk as summarized below. Additional information regarding our derivative financial instruments can be found in Note 10 — Fair Value Measurements and Note 16 — Accumulated Other Comprehensive Loss. Foreign Currency Risk Certain non-U.S. subsidiaries receive revenue and incur expenses in currencies other than their functional currency, and as a result, the foreign subsidiary’s functional currency revenue and/or expenses will fluctuate as the currency rates change. Additionally, the forecasted Pounds sterling expenses of our London brokerage market operations may exceed their Pounds sterling revenue, and the entity with such operations may also hold significant foreign currency asset or liability positions in the condensed consolidated balance sheet. To reduce such variability, we use foreign exchange contracts to hedge against this currency risk. These derivatives were designated as hedging instruments and at March 31, 2021 and December 31, 2020 had total notional amounts of $249 million and $340 million, respectively, and had net fair value assets of $8 million and $5 million, respectively. As part of and prior to our disposal of Miller (see Note 3 – Divestitures), and prior to their contract expiration, we closed derivatives designated as hedging instruments with notional values of $27 million that were outstanding at December 31, 2020. At March 31, 2021, the Company estimates, based on current exchange rates, there will be $6 million of net derivative gains on forward exchange rates reclassified from accumulated other comprehensive loss into earnings within the next twelve months as the forecast transactions affect earnings. At March 31, 2021, our longest outstanding maturity was 1.7 years. The effects of the material derivative instruments that are designated as hedging instruments on the condensed consolidated statements of comprehensive income for the three months ended March 31, 2021 and 2020 are below. Amounts pertaining to the ineffective portion of hedging instruments and those excluded from effectiveness testing were immaterial for the three months ended March 31, 2021 and 2020. Three Months Ended March 31, Gain/(loss) recognized in OCI (effective element) 2021 2020 Forward exchange contracts $ 4 $ (24 ) Location of (loss)/gain reclassified from Accumulated OCL into income (effective element) (Loss)/gain reclassified from Accumulated OCL into income (effective element) 2021 2020 Revenue $ (2 ) $ — Salaries and benefits 3 (2 ) $ 1 $ (2 ) We also enter into foreign currency transactions, primarily to hedge certain intercompany loans and other balance sheet exposures in currencies other than the functional currency of a given entity. These derivatives are not generally designated as hedging instruments and at both March 31, 2021 and December 31, 2020, we had notional amounts of $1.5 billion. At March 31, 2021 and December 31, 2020, we had a net fair value liability of $1 million and a net fair value asset of $15 million, respectively. The effects of derivatives that have not been designated as hedging instruments on the condensed consolidated statements of comprehensive income for the three months ended March 31, 2021 and 2020 are as follows: Loss recognized in income Three Months Ended March 31, Derivatives not designated as hedging instruments: Location of loss recognized in income 2021 2020 Forward exchange contracts Other income, net $ (16 ) $ (12 ) |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Note 9 Current debt consists of the following: March 31, 2021 December 31, 2020 Revolving $1.25 billion credit facility ( i ) $ — $ — 5.750% senior notes due 2021 — 500 3.500% senior notes due 2021 450 449 Current portion of collateralized facility 21 22 $ 471 $ 971 Long-term debt consists of the following: March 31, 2021 December 31, 2020 Revolving $1.25 billion credit facility $ — $ — Collateralized facility (ii) 27 33 2.125% senior notes due 2022 (iii) 633 659 4.625% senior notes due 2023 249 249 3.600% senior notes due 2024 647 647 4.400% senior notes due 2026 546 546 4.500% senior notes due 2028 596 596 2.950% senior notes due 2029 726 726 6.125% senior notes due 2043 271 271 5.050% senior notes due 2048 395 395 3.875% senior notes due 2049 542 542 $ 4,632 $ 4,664 ( i ) The $1.25 billion revolving credit facility expires on March 7, 2022. (ii) At March 31, 2021 and December 31, 2020, the Company had $92 million and $98 million, respectively, of renewal commissions receivables pledged as collateral for this facility (ii i ) Notes issued in Euro (€540 million). Payment of 5.750% Senior Notes due 2021 In March 2021, the $500 million 5.750% senior notes matured. The principal and interest were repaid by the Company using cash on-hand. At March 31, 2021 and December 31, 2020, we were in compliance with all financial covenants. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 10 The Company has categorized its assets and liabilities that are measured at fair value on a recurring and non-recurring basis into a three-level fair value hierarchy, based on the reliability of the inputs used to determine fair value as follows: • Level 1: refers to fair values determined based on quoted market prices in active markets for identical assets; • Level 2: refers to fair values estimated using observable market-based inputs or unobservable inputs that are corroborated by market data; and • Level 3: includes fair values estimated using unobservable inputs that are not corroborated by market data. The following methods and assumptions were used by the Company in estimating its fair value disclosure for financial instruments: • Available-for-sale securities are classified as Level 1 because we use quoted market prices in determining the fair value of these securities. • Market values for our derivative instruments have been used to determine the fair value of forward foreign exchange contracts based on estimated amounts the Company would receive or have to pay to terminate the agreements, taking into account observable information about the current foreign currency forward rates. Such financial instruments are classified as Level 2 in the fair value hierarchy. • Contingent consideration payable is classified as Level 3, and we estimate fair value based on the likelihood and timing of achieving the relevant milestones of each arrangement, applying a probability assessment to each of the potential outcomes, which at times includes the use of a Monte Carlo simulation, and discounting the probability-weighted payout. Typically, milestones are based on revenue or earnings growth for the acquired business. The following tables present our assets and liabilities measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020: Fair Value Measurements on a Recurring Basis at March 31, 2021 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities: Mutual funds / exchange traded funds Prepaid and other current assets and other non-current assets $ 9 $ — $ — $ 9 Derivatives: Derivative financial instruments ( i ) Prepaid and other current assets and other non-current assets $ — $ 10 $ — $ 10 Liabilities: Contingent consideration: Contingent consideration (ii) Other current liabilities and other non-current liabilities $ — $ — $ 28 $ 28 Derivatives: Derivative financial instruments ( i ) Other current liabilities and other non-current liabilities $ — $ 3 $ — $ 3 Fair Value Measurements on a Recurring Basis at December 31, 2020 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities: Mutual funds / exchange traded funds Prepaid and other current assets and other non-current assets $ 8 $ — $ — $ 8 Derivatives: Derivative financial instruments ( i ) Prepaid and other current assets and other non-current assets $ — $ 27 $ — $ 27 Liabilities: Contingent consideration: Contingent consideration (ii) Other current liabilities and other non-current liabilities $ — $ — $ 45 $ 45 Derivatives: Derivative financial instruments ( i ) Other current liabilities and other non-current liabilities $ — $ 7 $ — $ 7 ( i ) See Note 8 — Derivative Financial Instruments for further information on our derivative investments. (ii) Probability weightings are based on our knowledge of the past and planned performance of the acquired entity to which the contingent consideration applies. The fair value weighted-average discount rates used on our material contingent consideration calculations were 10.92% and 9.46% at March 31, 2021 and December 31, 2020, respectively. The range of these discount rates was 3.53% - 13.00% at March 31, 2021. Using different probability weightings and discount rates could result in an increase or decrease of the contingent consideration payable. The following table summarizes the change in fair value of the Level 3 liabilities: Fair Value Measurements Using Significant Unobservable Inputs (Level 3) March 31, 2021 Balance at December 31, 2020 $ 45 Payments (17 ) Balance at March 31, 2021 $ 28 There were no significant transfers to or from Level 3 in the three months ended March 31, 2021. Fair value information about financial instruments not measured at fair value The following tables present our liabilities not measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Carrying Value Fair Value Carrying Value Fair Value Assets: Long-term note receivable $ 67 $ 69 $ 71 $ 73 Liabilities: Current debt $ 471 $ 476 $ 971 $ 985 Long-term debt $ 4,632 $ 5,141 $ 4,664 $ 5,488 The carrying values of our revolving credit facility and collateralized facility approximate their fair values. The fair values above, which exclude accrued interest, are not necessarily indicative of the amounts that the Company would realize upon disposition, nor do they indicate the Company’s intent or ability to dispose of the financial instruments. The fair values of our respective senior notes and long-term note receivable are considered Level 2 financial instruments as they are corroborated by observable market data. |
Retirement Benefits
Retirement Benefits | 3 Months Ended |
Mar. 31, 2021 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Benefits | Note 11 Defined Benefit Plans and Post-retirement Welfare Plans Willis Towers Watson sponsors both qualified and non-qualified defined benefit pension plans and other post-retirement welfare (‘PRW’) plans throughout the world. The majority of our plan assets and obligations are in the U.S. and the U.K. We have also included disclosures related to defined benefit plans in certain other countries, including Canada, France, Germany and Ireland. Together, these disclosed funded and unfunded plans represent 99% of Willis Towers Watson’s pension and PRW obligations and are disclosed herein. Components of Net Periodic Benefit (Income)/Cost for Defined Benefit Pension and Post-retirement Welfare Plans The following table sets forth the components of net periodic benefit (income)/cost for the Company’s defined benefit pension and PRW plans for the three months ended March 31, 2021 and 2020: Three Months Ended March 31, 2021 2020 U.S. U.K. Other PRW U.S. U.K. Other PRW Service cost $ 20 $ 4 $ 6 $ — $ 18 $ 4 $ 5 $ — Interest cost 23 14 3 — 33 18 4 1 Expected return on plan assets (77 ) (43 ) (9 ) — (73 ) (62 ) (8 ) — Settlement 1 — — — — — — — Amortization of net loss 11 7 1 — 9 6 — — Amortization of prior service credit — (4 ) — (1 ) — (4 ) — (1 ) Net periodic benefit (income)/cost $ (22 ) $ (22 ) $ 1 $ (1 ) $ (13 ) $ (38 ) $ 1 $ — Employer Contributions to Defined Benefit Pension Plans The Company made $60 million of contributions to its U.S. plans for the three months ended March 31, 2021 and does not anticipate making any additional contributions over the remainder of the fiscal year. The Company made contributions of $10 million to its U.K. plans for the three months ended March 31, 2021 and anticipates making additional contributions of $31 million for the remainder of the fiscal year. The Company made contributions of $16 million to its other plans for the three months ended March 31, 2021 and anticipates making additional contributions of $9 million for the remainder of the fiscal year. Defined Contribution Plans The Company made contributions to its defined contribution plans of $43 million during both the three months ended March 31, 2021 and 2020. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Leases | Note 12 The following table presents lease costs recorded on our condensed consolidated statements of comprehensive income for the three months ended March 31, 2021 and 2020, respectively: Three Months Ended March 31, 2021 2020 Finance lease cost: Amortization of right-of-use assets $ — $ 1 Interest on lease liabilities 1 1 Operating lease cost 46 47 Variable lease cost 13 10 Sublease income (5 ) (5 ) Total lease cost, net $ 55 $ 54 The total lease cost is recognized in different locations in our condensed consolidated statements of comprehensive income. Amortization of the finance lease ROU assets is included in depreciation, while the interest cost component of these finance leases is included in interest expense. All other costs are included in other operating expenses. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13 Indemnification Agreements Willis Towers Watson has various agreements which provide that it may be obligated to indemnify the other party to the agreement with respect to certain matters. Generally, these indemnification provisions are included in contracts arising in the normal course of business and in connection with the purchase and sale of certain businesses. It is not possible to predict the maximum potential amount of future payments that may become due under these indemnification agreements because of the conditional nature of the Company’s obligations and the unique facts of each particular agreement. However, we do not believe that any potential liability that may arise from such indemnity provisions is probable or material. Legal Proceedings In the ordinary course of business, the Company is subject to various actual and potential claims, lawsuits and other proceedings. Some of the claims, lawsuits and other proceedings seek damages in amounts which could, if assessed, be significant. We expect the impact of claims or demands not described below to be immaterial to the Company’s condensed consolidated financial statements. The Company also receives subpoenas in the ordinary course of business and, from time to time, receives requests for information in connection with governmental investigations. Errors and omissions claims, lawsuits, and other proceedings arising in the ordinary course of business are covered in part by professional indemnity or other appropriate insurance. The terms of this insurance vary by policy year. Regarding self-insured risks, the Company has established provisions which are believed to be adequate in light of current information and legal advice, or, in certain cases, where a range of loss exists, the Company accrues the minimum amount in the range if no amount within the range is a better estimate than any other amount. The Company adjusts such provisions from time to time according to developments. See Note 14 — On the basis of current information, the Company does not expect that the actual claims, lawsuits and other proceedings to which it is subject, or potential claims, lawsuits, and other proceedings relating to matters of which it is aware, will ultimately have a material adverse effect on its financial condition, results of operations or liquidity. Nonetheless, given the large or indeterminate amounts sought in certain of these actions, and the inherent unpredictability of litigation and disputes with insurance companies, it is possible that an adverse outcome or settlement in certain matters could, from time to time, have a material adverse effect on the Company’s results of operations or cash flows in particular quarterly or annual periods. In addition, given the early stages of some litigation or regulatory proceedings described below, it may not be possible to predict their outcomes or resolutions, and it is possible that any one or more of these events may have a material adverse effect on the Company. The Company provides for contingent liabilities based on ASC 450, Contingencies, Willis Towers Watson Merger-Related Securities Litigation The Company was named as a defendant in two consolidated actions arising out of the 2016 ‘merger of equals’ between Towers Watson and Willis (the ‘Merger’), consisting of a consolidated shareholder class action pending in the United States District Court for the Eastern District of Virginia, captioned ‘In re Willis Towers Watson plc Proxy Litigation,’ Master File No. 1:17-cv-1338-AJT-JFA (the ‘Federal Action’), and a consolidated putative shareholder class action pending in the Delaware Court of Chancery, captioned ‘In re Towers Watson & Co. Stockholders Litigation,’ C.A. No. 2018-0132-KSJM (the ‘Delaware Action’). The complaints in these actions generally allege that the defendants omitted material information from the proxy disclosures relating to the Merger, including with respect to potential conflicts of interest, and, as a result, that Towers Watson’s stockholders approved the Merger based on inadequate information. Based on these allegations, among others, the complaint in the Federal Action asserts claims under Sections 14(a) and 20(a) of the Securities Exchange Act of 1934, and the complaint in the Delaware Action asserts claims under Delaware state law for breach of fiduciary duty and aiding and abetting breach of fiduciary duty. On or about November 19, 2020, the parties to the Federal Action and the Delaware Action reached an agreement in principle to resolve the Federal Action and the Delaware Action for $75 million and $15 million, respectively. The Company agreed to the settlement and the payment of the settlement amounts to eliminate the distraction, burden, expense and uncertainty of further litigation. Further, in reaching the settlement, the parties understood and agreed that there is no admission of liability or wrongdoing by the Company or any of the other defendants in either the Federal Action or the Delaware Action. The Company and the other defendants expressly deny any liability or wrongdoing with respect to the matters alleged in the Federal Action and the Delaware Action. On January 15, 2021, the parties to the Federal Action and the Delaware Action signed formal stipulations of settlement, which memorialized the terms of the agreement in principle, and which the plaintiffs in the Federal Action and the Delaware Action then filed with each of the respective courts. Also on January 15, 2021, the plaintiff in the Federal Action filed a motion to preliminarily approve the settlement. On January 21, 2021, the court in the Federal Action preliminarily approved the settlement, approved the form of notice to be disseminated to class members, and scheduled a final fairness hearing on the settlement for May 21, 2021. On January 25, 2021, the court in the Delaware Action approved the form of notice to be disseminated to class members and scheduled a final fairness hearing on the settlement for May 25, 2021. The settlement is contingent upon final approval by the courts in both the Federal Action and the Delaware Action. The Company made the $ 90 million aggregate settlement payment in escrow in February 2021, but it will not be distributed to class members unless and until the settlement is finally approved by the courts in both the Federal Action and the Delaware Action and not subject to any further appeal. During 2020, the Company recognized $65 million of expense, net of $25 million of insurance and other recoveries. Additional insurance recoveries are possible. Aviation Broking Competition Investigations In October 2017, the European Commission (‘Commission’) disclosed to us that it has initiated civil investigation proceedings in respect of a suspected infringement of E.U. competition rules involving several broking firms, including our principal U.K. broking subsidiary and one of its parent entities. In particular, the Commission has stated that the civil proceedings concern the exchange of commercially sensitive information between competitors in relation to aviation and aerospace insurance and reinsurance broking products and services in the European Economic Area, as well as possible coordination between competitors. In November 2020, the Commission advised us that it has decided to close the proceedings against us without taking further action. Since 2017, we have become aware that other countries are conducting their own investigations of the same or similar alleged conduct relating to certain competition rules involving several of our broking firms in certain countries, including, without limitation, Brazil. In January 2019, the Brazil Conselho Administrativo de Defesa Economica (‘CADE’) launched an administrative proceeding to investigate alleged sharing of competitive and commercially sensitive information in the insurance and reinsurance brokerage industry for aviation and aerospace and related ancillary services. The CADE identified 11 entities under investigation, including Willis Group Limited, one of our U.K. subsidiaries. While the investigation is currently ongoing, we do not expect our liability, if any, to be material. |
Supplementary Information for C
Supplementary Information for Certain Balance Sheet Accounts | 3 Months Ended |
Mar. 31, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Supplementary Information for Certain Balance Sheet Accounts | Note 14 — Supplementary Information for Certain Balance Sheet Accounts Additional details of specific balance sheet accounts are detailed below. Prepaid and other current assets consist of the following: March 31, 2021 December 31, 2020 Prepayments and accrued income $ 138 $ 124 Deferred contract costs 74 108 Derivatives and investments 26 42 Deferred compensation plan assets 13 14 Retention incentives 7 3 Corporate income and other taxes 99 83 Insurance and other recovery receivables 2 25 Restricted cash 6 7 Acquired renewal commissions receivable 14 16 Other current assets 53 75 Total prepaid and other current assets $ 432 $ 497 Deferred revenue and accrued expenses consist of the following: March 31, 2021 December 31, 2020 Accounts payable, accrued liabilities and deferred income $ 913 $ 862 Accrued discretionary and incentive compensation 383 851 Litigation settlements — 210 Accrued vacation 182 161 Other employee-related liabilities 48 77 Total deferred revenue and accrued expenses $ 1,526 $ 2,161 Provision for liabilities consists of the following: March 31, 2021 December 31, 2020 Claims, lawsuits and other proceedings $ 316 $ 325 Other provisions 74 82 Total provision for liabilities $ 390 $ 407 |
Other Income, Net
Other Income, Net | 3 Months Ended |
Mar. 31, 2021 | |
Other Income And Expenses [Abstract] | |
Other Income, Net | Note 15 — Other Income, Net Other income, net consists of the following: Three Months Ended March 31, 2021 2020 Gain on disposal of operations $ 359 $ — Net periodic pension and postretirement benefit credits 76 76 Interest in earnings of associates and other investments 2 2 Foreign exchange gain 2 12 Other — 2 Other income, net $ 439 $ 92 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Note 16 — Accumulated Other Comprehensive Loss Changes in accumulated other comprehensive loss, net of non-controlling interests, and net of tax are provided in the following tables for the three months ended March 31, 2021 and 2020. These tables exclude amounts attributable to non-controlling interests, which are not material for further disclosure. Foreign currency translation (i) Derivative instruments (i) Defined pension and post-retirement benefit costs (ii) Total 2021 2020 2021 2020 2021 2020 2021 2020 Balance at December 31, 2020 and 2019, respectively $ (400 ) $ (538 ) $ 9 $ 13 $ (1,968 ) $ (1,702 ) $ (2,359 ) $ (2,227 ) Other comprehensive income/(loss) before reclassifications (42 ) (208 ) 7 (19 ) 1 (4 ) (34 ) (231 ) Loss/(gain) reclassified from accumulated other comprehensive loss (net of income tax benefit of $6 and $0, respectively) (iii) 44 — (1 ) 1 39 11 82 12 Net current-period other comprehensive income/(loss) 2 (208 ) 6 (18 ) 40 7 48 (219 ) Balance at March 31, 2021 and 2020, respectively $ (398 ) $ (746 ) $ 15 $ (5 ) $ (1,928 ) $ (1,695 ) $ (2,311 ) $ (2,446 ) (i) Reclassification adjustments from accumulated other comprehensive loss related to derivative instruments are included in Revenue and Salaries and benefits in the accompanying condensed consolidated statements of comprehensive income. See Note 8 — Derivative Financial Instruments for additional details regarding the reclassification adjustments for the derivative settlements. (ii) Reclassification adjustments from accumulated other comprehensive loss are included in the computation of net periodic pension cost (see Note 11 — Retirement Benefits). These components are included in Other income, net in the accompanying condensed consolidated statements of comprehensive income. (iii) Includes reclassifications of $44 million and $31 million of foreign currency translation and defined pension and post-retirement benefit costs, respectively, attributable to the gain on disposal of our Miller business (see Note 3 — Divestitures). The net gain on disposal is included in Other income, net in the accompanying condensed consolidated statements of comprehensive income. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 17 — Earnings Per Share Basic and diluted earnings per share are calculated by dividing net income attributable to Willis Towers Watson by the average number of ordinary shares outstanding during each period. The computation of diluted earnings per share reflects the potential dilution that could occur if dilutive securities and other contracts to issue shares were exercised or converted into shares or resulted in the issuance of shares that then shared in the net income of the Company. At March 31, 2021 and 2020, there were 0.1 million and 0.2 million time-based share options, and 0.5 million and 0.3 million restricted performance-based stock units outstanding, respectively. There were 0.3 million performance-based options at both March 31, 2021 and 2020. The Company’s restricted time-based stock units were immaterial at March 31, 2021 and 2020. Basic and diluted earnings per share are as follows: Three Months Ended March 31, 2021 2020 Net income attributable to Willis Towers Watson $ 733 $ 305 Basic average number of shares outstanding 130 130 Dilutive effect of potentially issuable shares — — Diluted average number of shares outstanding 130 130 Basic earnings per share $ 5.64 $ 2.36 Dilutive effect of potentially issuable shares (0.01 ) (0.02 ) Diluted earnings per share $ 5.63 $ 2.34 For the three months ended March 31, 2021, 0.2 million restricted stock units were not included in the computation of the dilutive effect of potentially issuable shares because their effect was anti-dilutive; there were no anti-dilutive restricted stock units for the three months ended March 31, 2020. There were no anti-dilutive options for the three months ended March 31, 2021 and 2020. |
Basis of Presentation and Rec_2
Basis of Presentation and Recent Accounting Pronouncements (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited quarterly condensed consolidated financial statements of Willis Towers Watson and our subsidiaries are presented in accordance with the rules and regulations of the SEC for quarterly reports on Form 10-Q and therefore do not include all of the information and footnotes required by U.S. GAAP. In the opinion of management, these condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, which are necessary for a fair presentation of the condensed consolidated financial statements and results for the interim periods. All intercompany accounts and transactions have been eliminated in consolidation. The condensed consolidated financial statements should be read together with the Company’s Annual Report on Form 10-K, filed with the SEC on February 23, 2021, and may be accessed via EDGAR on the SEC’s web site at www.sec.gov. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results that can be expected for the entire year. The Company experiences seasonal fluctuations of its revenue. Revenue is typically higher during the Company’s first and fourth quarters due primarily to the timing of broking-related activities. The results reflect certain estimates and assumptions made by management, including those estimates used in calculating acquisition consideration and fair value of tangible and intangible assets and liabilities, professional liability claims, estimated bonuses, valuation of billed and unbilled receivables, and anticipated tax liabilities that affect the amounts reported in the condensed consolidated financial statements and related notes. |
Risks and Uncertainties Related to the COVID-19 Pandemic | Risks and Uncertainties Related to the COVID-19 Pandemic The COVID-19 pandemic has had an adverse impact on global commercial activity, including the global supply chain, and has contributed to significant volatility in the global financial markets including, among other effects, occasional declines in the equity markets, changes in interest rates and reduced liquidity on a global basis. With regard to the effects on our own business operations and those of our clients, suppliers and other third parties with whom we interact, the Company has regularly considered the impact of COVID-19 on our business, taking into account our business resilience and continuity plans, financial modeling and stress testing of liquidity and financial resources. Generally, the COVID-19 pandemic did not have a material adverse impact on our overall financial results during 2020 or on our results for the first quarter of 2021; however, during 2020 and through the first quarter of 2021, the COVID-19 pandemic continues to negatively impact our revenue growth, primarily in our businesses that are discretionary in nature. We believe such level of impact will continue through much of 2021, at least until a sufficient portion of the populations in jurisdictions where we do business have been vaccinated and social-distancing orders are lessened or lifted. As part of the significant estimates and assumptions that are inherent in our financial statements, we have considered the impact COVID-19 will have on our client behavior and the economic environment looking forward for the remainder of 2021 and throughout the geographies in which we operate. These estimates and assumptions include the collectability of billed and unbilled receivables, the estimation of revenue, and the fair value of our reporting units, tangible and intangible assets and contingent consideration. With regard to collectability of receivables, we believe we may continue to face atypical delays in client payments going forward. The demand for certain discretionary lines of business has decreased, and we believe that decrease may continue to impact our financial results in succeeding periods. Non-discretionary lines of business have also been, to some extent, adversely affected and may be adversely affected in the future. Further, reduced economic activity or disruption in insurance markets could reduce the demand for or the extent of insurance coverage. For example, we have seen instances where the reduced demand for air travel has reduced the extent of insurance coverage needed. Also, the increased frequency and severity of coverage disputes between our clients and (re)insurers arising out of the pandemic could increase our professional liability risk. We will continue to monitor the situation and assess any implications to our business and our stakeholders. The extent to which COVID-19 impacts our business and financial position will depend on future developments, which are difficult to predict. These future developments may include the severity and scope of the COVID-19 outbreak, which may unexpectedly change or worsen, and the types and duration of measures imposed by governmental authorities to contain the virus or address its impact. We continue to expect that the COVID-19 pandemic will negatively impact our revenue and operating results in fiscal 2021. We believe that these trends and uncertainties are similar to those faced by other comparable registrants as a result of the pandemic. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Adopted In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes |
Fair Value of Financial Instruments | The Company has categorized its assets and liabilities that are measured at fair value on a recurring and non-recurring basis into a three-level fair value hierarchy, based on the reliability of the inputs used to determine fair value as follows: • Level 1: refers to fair values determined based on quoted market prices in active markets for identical assets; • Level 2: refers to fair values estimated using observable market-based inputs or unobservable inputs that are corroborated by market data; and • Level 3: includes fair values estimated using unobservable inputs that are not corroborated by market data. The following methods and assumptions were used by the Company in estimating its fair value disclosure for financial instruments: • Available-for-sale securities are classified as Level 1 because we use quoted market prices in determining the fair value of these securities. • Market values for our derivative instruments have been used to determine the fair value of forward foreign exchange contracts based on estimated amounts the Company would receive or have to pay to terminate the agreements, taking into account observable information about the current foreign currency forward rates. Such financial instruments are classified as Level 2 in the fair value hierarchy. • Contingent consideration payable is classified as Level 3, and we estimate fair value based on the likelihood and timing of achieving the relevant milestones of each arrangement, applying a probability assessment to each of the potential outcomes, which at times includes the use of a Monte Carlo simulation, and discounting the probability-weighted payout. Typically, milestones are based on revenue or earnings growth for the acquired business. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue From Contract With Customer [Abstract] | |
Disaggregation of Revenue | The following table presents revenue by service offering and segment, as well as a reconciliation to total revenue for the three months ended March 31, 2021 and 2020. Along with reimbursable expenses and other, total revenue by service offering represents our revenue from customer contracts. Three Months Ended March 31, HCB CRB IRR BDA Corporate ( i ) Total 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 Broking $ 97 $ 83 $ 717 $ 648 $ 412 $ 433 $ 152 $ 98 $ — $ — $ 1,378 $ 1,262 Consulting 594 582 44 47 123 93 — — 2 2 763 724 Outsourced administration 132 128 25 25 4 3 132 133 — — 293 289 Other 49 47 4 1 65 83 — — 1 1 119 132 Total revenue by service offering 872 840 790 721 604 612 284 231 3 3 2,553 2,407 Reimbursable expenses and other ( i ) 11 15 — — 1 3 2 3 (5 ) 6 9 27 Total revenue from customer contracts $ 883 $ 855 $ 790 $ 721 $ 605 $ 615 $ 286 $ 234 $ (2 ) $ 9 $ 2,562 $ 2,434 Interest and other income (ii) 3 10 20 18 1 3 3 — 1 1 28 32 Total revenue $ 886 $ 865 $ 810 $ 739 $ 606 $ 618 $ 289 $ 234 $ (1 ) $ 10 $ 2,590 $ 2,466 ______________ ( i ) Reimbursable expenses and other, as well as Corporate revenue, are excluded from segment revenue, but included in total revenue on the condensed consolidated statements of comprehensive income. Amounts included in Corporate revenue may include eliminations and impacts from hedged revenue transactions. ( i i ) Interest and other income is included in segment revenue and total revenue, however it has been presented separately in the above tables because it does not arise directly from contracts with customers. Individual revenue streams aggregating to approximately 5% of total revenue from customer contracts for the three months ended March 31, 2021 and 2020 have been included within the Other line in the tables above. The following table presents revenue by the geography where our work is performed for the three months ended March 31, 2021 and 2020. The reconciliation to total revenue on our condensed consolidated statement of comprehensive income and to segment revenue is shown in the table above. Three Months Ended March 31, HCB CRB IRR BDA Corporate Total 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 North America $ 468 $ 476 $ 247 $ 233 $ 186 $ 170 $ 282 $ 229 $ 2 $ 2 $ 1,185 $ 1,110 Great Britain 147 126 155 137 311 321 — — — — 613 584 Western Europe 171 156 261 244 59 76 — — 1 1 492 477 International 86 82 127 107 48 45 2 2 — — 263 236 Total revenue by geography $ 872 $ 840 $ 790 $ 721 $ 604 $ 612 $ 284 $ 231 $ 3 $ 3 $ 2,553 $ 2,407 |
Contract with Customer, Asset and Liability | The Company reports accounts receivable, net on the condensed consolidated balance sheet, which includes billed and unbilled receivables and current contract assets. In addition to accounts receivable, net, the Company had the following non-current contract assets and deferred revenue balances at March 31, 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Billed receivables, net of allowance for doubtful accounts of $44 million and $41 million $ 1,727 $ 1,697 Unbilled receivables 508 445 Current contract assets 334 413 Accounts receivable, net $ 2,569 $ 2,555 Non-current accounts receivable, net $ 22 $ 34 Non-current contract assets $ 380 $ 329 Deferred revenue $ 620 $ 549 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | In addition, in accordance with ASC 606, Revenue From Contracts With Customers • Performance obligations which are part of a contract that has an original expected duration of less than one year, and • Performance obligations satisfied in accordance with ASC 606-10-55-18 (‘right to invoice’). Remainder of 2021 2022 2023 onward Total Revenue expected to be recognized on contracts as of March 31, 2021 $ 429 $ 426 $ 476 $ 1,331 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table presents segment revenue and segment operating income for our reportable segments for the three months ended March 31, 2021 and 2020. Three Months Ended March 31, HCB CRB IRR BDA Total 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 Segment revenue $ 875 $ 850 $ 810 $ 739 $ 605 $ 615 $ 287 $ 231 $ 2,577 $ 2,435 Segment operating income/(loss) $ 220 $ 213 $ 162 $ 127 $ 290 $ 277 $ 7 $ (11 ) $ 679 $ 606 |
Net Operating Income of the Reported Segments | The following table presents a reconciliation of the information reported by segment to the Company’s condensed consolidated statement of comprehensive income amounts reported for the three months ended March 31, 2021 and 2020. Three Months Ended March 31, 2021 2020 Revenue: Total segment revenue $ 2,577 $ 2,435 Reimbursable expenses and other 13 31 Revenue $ 2,590 $ 2,466 Total segment operating income $ 679 $ 606 Amortization (103 ) (121 ) Transaction and integration expenses ( i ) (24 ) (9 ) Unallocated, net (ii) (100 ) (116 ) Income from operations 452 360 Interest expense (59 ) (61 ) Other income, net 439 92 Income from operations before income taxes $ 832 $ 391 ( i ) Includes mainly transaction costs related to the proposed Aon combination. (ii) Includes certain costs, primarily related to corporate functions which are not directly related to the segments, and certain differences between budgeted expenses determined at the beginning of the year and actual expenses that we report for U.S. GAAP purposes. |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Components of Goodwill | The components of goodwill are outlined below for the three months ended March 31, 2021: HCB CRB IRR BDA Total Balance at December 31, 2020: Goodwill, gross $ 4,346 $ 2,378 $ 1,694 $ 3,278 $ 11,696 Accumulated impairment losses (130 ) (362 ) — — (492 ) Goodwill, net - December 31, 2020 4,216 2,016 1,694 3,278 11,204 Goodwill disposals — — (188 ) — (188 ) Foreign exchange (17 ) (16 ) 3 — (30 ) Balance at March 31, 2021: Goodwill, gross 4,329 2,362 1,509 3,278 11,478 Accumulated impairment losses (130 ) (362 ) — — (492 ) Goodwill, net - March 31, 2021 $ 4,199 $ 2,000 $ 1,509 $ 3,278 $ 10,986 |
Changes in the Net Carrying Amount of the Components of Finite-Lived Intangible Assets | The following table reflects changes in the net carrying amounts of the components of finite-lived intangible assets for the three months ended March 31, 2021: Client relationships Software Trademark and trade name Other Total Balance at December 31, 2020: Intangible assets, gross $ 4,065 $ 761 $ 1,054 $ 108 $ 5,988 Accumulated amortization (2,031 ) (659 ) (220 ) (35 ) (2,945 ) Intangible assets, net - December 31, 2020 2,034 102 834 73 3,043 Intangible asset disposals (46 ) — (8 ) — (54 ) Amortization (69 ) (19 ) (11 ) (4 ) (103 ) Foreign exchange (10 ) — — 2 (8 ) Balance at March 31, 2021: Intangible assets, gross 3,865 759 1,040 110 5,774 Accumulated amortization (1,956 ) (676 ) (225 ) (39 ) (2,896 ) Intangible assets, net - March 31, 2021 $ 1,909 $ 83 $ 815 $ 71 $ 2,878 |
Schedule of Future Estimated Amortization Expense for Amortizable Intangible Assets | The table below reflects the future estimated amortization expense for amortizable intangible assets for the remainder of 2021 and for subsequent years: Amortization Remainder of 2021 $ 268 2022 308 2023 257 2024 224 2025 205 Thereafter 1,616 Total $ 2,878 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Designated [Member] | |
Schedule of Derivative Instruments Designated/Nondesignated As Hedging Instrument Effect on Condensed Consolidated Statements of Comprehensive Income | The effects of the material derivative instruments that are designated as hedging instruments on the condensed consolidated statements of comprehensive income for the three months ended March 31, 2021 and 2020 are below Three Months Ended March 31, Gain/(loss) recognized in OCI (effective element) 2021 2020 Forward exchange contracts $ 4 $ (24 ) Location of (loss)/gain reclassified from Accumulated OCL into income (effective element) (Loss)/gain reclassified from Accumulated OCL into income (effective element) 2021 2020 Revenue $ (2 ) $ — Salaries and benefits 3 (2 ) $ 1 $ (2 ) |
Nondesignated [Member] | |
Schedule of Derivative Instruments Designated/Nondesignated As Hedging Instrument Effect on Condensed Consolidated Statements of Comprehensive Income | The effects of derivatives that have not been designated as hedging instruments on the condensed consolidated statements of comprehensive income for the three months ended March 31, 2021 and 2020 are as follows: Loss recognized in income Three Months Ended March 31, Derivatives not designated as hedging instruments: Location of loss recognized in income 2021 2020 Forward exchange contracts Other income, net $ (16 ) $ (12 ) |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Current and Long-term Debt | Current debt consists of the following: March 31, 2021 December 31, 2020 Revolving $1.25 billion credit facility ( i ) $ — $ — 5.750% senior notes due 2021 — 500 3.500% senior notes due 2021 450 449 Current portion of collateralized facility 21 22 $ 471 $ 971 Long-term debt consists of the following: March 31, 2021 December 31, 2020 Revolving $1.25 billion credit facility $ — $ — Collateralized facility (ii) 27 33 2.125% senior notes due 2022 (iii) 633 659 4.625% senior notes due 2023 249 249 3.600% senior notes due 2024 647 647 4.400% senior notes due 2026 546 546 4.500% senior notes due 2028 596 596 2.950% senior notes due 2029 726 726 6.125% senior notes due 2043 271 271 5.050% senior notes due 2048 395 395 3.875% senior notes due 2049 542 542 $ 4,632 $ 4,664 ( i ) The $1.25 billion revolving credit facility expires on March 7, 2022. (ii) At March 31, 2021 and December 31, 2020, the Company had $92 million and $98 million, respectively, of renewal commissions receivables pledged as collateral for this facility (ii i ) Notes issued in Euro (€540 million). |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The following tables present our assets and liabilities measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020: Fair Value Measurements on a Recurring Basis at March 31, 2021 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities: Mutual funds / exchange traded funds Prepaid and other current assets and other non-current assets $ 9 $ — $ — $ 9 Derivatives: Derivative financial instruments ( i ) Prepaid and other current assets and other non-current assets $ — $ 10 $ — $ 10 Liabilities: Contingent consideration: Contingent consideration (ii) Other current liabilities and other non-current liabilities $ — $ — $ 28 $ 28 Derivatives: Derivative financial instruments ( i ) Other current liabilities and other non-current liabilities $ — $ 3 $ — $ 3 Fair Value Measurements on a Recurring Basis at December 31, 2020 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities: Mutual funds / exchange traded funds Prepaid and other current assets and other non-current assets $ 8 $ — $ — $ 8 Derivatives: Derivative financial instruments ( i ) Prepaid and other current assets and other non-current assets $ — $ 27 $ — $ 27 Liabilities: Contingent consideration: Contingent consideration (ii) Other current liabilities and other non-current liabilities $ — $ — $ 45 $ 45 Derivatives: Derivative financial instruments ( i ) Other current liabilities and other non-current liabilities $ — $ 7 $ — $ 7 ( i ) See Note 8 — Derivative Financial Instruments for further information on our derivative investments. (ii) Probability weightings are based on our knowledge of the past and planned performance of the acquired entity to which the contingent consideration applies. The fair value weighted-average discount rates used on our material contingent consideration calculations were 10.92% and 9.46% at March 31, 2021 and December 31, 2020, respectively. The range of these discount rates was 3.53% - 13.00% at March 31, 2021. Using different probability weightings and discount rates could result in an increase or decrease of the contingent consideration payable. |
Schedule of Change in Fair Value of Level 3 Liabilities | The following table summarizes the change in fair value of the Level 3 liabilities: Fair Value Measurements Using Significant Unobservable Inputs (Level 3) March 31, 2021 Balance at December 31, 2020 $ 45 Payments (17 ) Balance at March 31, 2021 $ 28 |
Schedule of Liabilities Whose Carrying Values Differ From the Fair Value and are Not Measured on a Recurring Basis | Fair value information about financial instruments not measured at fair value The following tables present our liabilities not measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Carrying Value Fair Value Carrying Value Fair Value Assets: Long-term note receivable $ 67 $ 69 $ 71 $ 73 Liabilities: Current debt $ 471 $ 476 $ 971 $ 985 Long-term debt $ 4,632 $ 5,141 $ 4,664 $ 5,488 |
Retirement Benefits (Tables)
Retirement Benefits (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Compensation And Retirement Disclosure [Abstract] | |
Schedule of Net Periodic Benefit Cost | The following table sets forth the components of net periodic benefit (income)/cost for the Company’s defined benefit pension and PRW plans for the three months ended March 31, 2021 and 2020: Three Months Ended March 31, 2021 2020 U.S. U.K. Other PRW U.S. U.K. Other PRW Service cost $ 20 $ 4 $ 6 $ — $ 18 $ 4 $ 5 $ — Interest cost 23 14 3 — 33 18 4 1 Expected return on plan assets (77 ) (43 ) (9 ) — (73 ) (62 ) (8 ) — Settlement 1 — — — — — — — Amortization of net loss 11 7 1 — 9 6 — — Amortization of prior service credit — (4 ) — (1 ) — (4 ) — (1 ) Net periodic benefit (income)/cost $ (22 ) $ (22 ) $ 1 $ (1 ) $ (13 ) $ (38 ) $ 1 $ — |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Schedule of Lease Costs Recorded in Condensed Consolidated Statements of Comprehensive Income | The following table presents lease costs recorded on our condensed consolidated statements of comprehensive income for the three months ended March 31, 2021 and 2020, respectively: Three Months Ended March 31, 2021 2020 Finance lease cost: Amortization of right-of-use assets $ — $ 1 Interest on lease liabilities 1 1 Operating lease cost 46 47 Variable lease cost 13 10 Sublease income (5 ) (5 ) Total lease cost, net $ 55 $ 54 |
Supplementary Information for_2
Supplementary Information for Certain Balance Sheet Accounts (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Schedule of Prepaid and Other Current Assets | Prepaid and other current assets consist of the following: March 31, 2021 December 31, 2020 Prepayments and accrued income $ 138 $ 124 Deferred contract costs 74 108 Derivatives and investments 26 42 Deferred compensation plan assets 13 14 Retention incentives 7 3 Corporate income and other taxes 99 83 Insurance and other recovery receivables 2 25 Restricted cash 6 7 Acquired renewal commissions receivable 14 16 Other current assets 53 75 Total prepaid and other current assets $ 432 $ 497 |
Deferred Revenue and Accrued Expenses | Deferred revenue and accrued expenses consist of the following: March 31, 2021 December 31, 2020 Accounts payable, accrued liabilities and deferred income $ 913 $ 862 Accrued discretionary and incentive compensation 383 851 Litigation settlements — 210 Accrued vacation 182 161 Other employee-related liabilities 48 77 Total deferred revenue and accrued expenses $ 1,526 $ 2,161 |
Provisions for Liabilities | Provision for liabilities consists of the following: March 31, 2021 December 31, 2020 Claims, lawsuits and other proceedings $ 316 $ 325 Other provisions 74 82 Total provision for liabilities $ 390 $ 407 |
Other Income, Net (Tables)
Other Income, Net (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Income And Expenses [Abstract] | |
Schedule of Other Nonoperating Income | Other income, net consists of the following: Three Months Ended March 31, 2021 2020 Gain on disposal of operations $ 359 $ — Net periodic pension and postretirement benefit credits 76 76 Interest in earnings of associates and other investments 2 2 Foreign exchange gain 2 12 Other — 2 Other income, net $ 439 $ 92 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in accumulated other comprehensive loss, net of non-controlling interests, and net of tax are provided in the following tables for the three months ended March 31, 2021 and 2020. These tables exclude amounts attributable to non-controlling interests, which are not material for further disclosure. Foreign currency translation (i) Derivative instruments (i) Defined pension and post-retirement benefit costs (ii) Total 2021 2020 2021 2020 2021 2020 2021 2020 Balance at December 31, 2020 and 2019, respectively $ (400 ) $ (538 ) $ 9 $ 13 $ (1,968 ) $ (1,702 ) $ (2,359 ) $ (2,227 ) Other comprehensive income/(loss) before reclassifications (42 ) (208 ) 7 (19 ) 1 (4 ) (34 ) (231 ) Loss/(gain) reclassified from accumulated other comprehensive loss (net of income tax benefit of $6 and $0, respectively) (iii) 44 — (1 ) 1 39 11 82 12 Net current-period other comprehensive income/(loss) 2 (208 ) 6 (18 ) 40 7 48 (219 ) Balance at March 31, 2021 and 2020, respectively $ (398 ) $ (746 ) $ 15 $ (5 ) $ (1,928 ) $ (1,695 ) $ (2,311 ) $ (2,446 ) (i) Reclassification adjustments from accumulated other comprehensive loss related to derivative instruments are included in Revenue and Salaries and benefits in the accompanying condensed consolidated statements of comprehensive income. See Note 8 — Derivative Financial Instruments for additional details regarding the reclassification adjustments for the derivative settlements. (ii) Reclassification adjustments from accumulated other comprehensive loss are included in the computation of net periodic pension cost (see Note 11 — Retirement Benefits). These components are included in Other income, net in the accompanying condensed consolidated statements of comprehensive income. (iii) Includes reclassifications of $44 million and $31 million of foreign currency translation and defined pension and post-retirement benefit costs, respectively, attributable to the gain on disposal of our Miller business (see Note 3 — Divestitures). The net gain on disposal is included in Other income, net in the accompanying condensed consolidated statements of comprehensive income. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | Basic and diluted earnings per share are as follows: Three Months Ended March 31, 2021 2020 Net income attributable to Willis Towers Watson $ 733 $ 305 Basic average number of shares outstanding 130 130 Dilutive effect of potentially issuable shares — — Diluted average number of shares outstanding 130 130 Basic earnings per share $ 5.64 $ 2.36 Dilutive effect of potentially issuable shares (0.01 ) (0.02 ) Diluted earnings per share $ 5.63 $ 2.34 |
Nature of Operations (Details)
Nature of Operations (Details) | Mar. 31, 2021EmployeeCountry |
Minority Interest [Line Items] | |
Number of employees employed (more than 00,000) | Employee | 46,000 |
Number of countries in which entity operates (more than 140) | Country | 140 |
Proposed Combination with AON Plc [Member] | |
Minority Interest [Line Items] | |
Number of shares receivable upon acquisition | 1.08 |
Proposed Combination with AON Plc [Member] | Aon Plc [Member] | |
Minority Interest [Line Items] | |
Percentage of ownership by parent | 63.00% |
Proposed Combination with AON Plc [Member] | Willis Towers Watson Public Limited Company [Member] | |
Minority Interest [Line Items] | |
Percentage of ownership by non-controlling owner | 37.00% |
Divestitures - Miller Divestitu
Divestitures - Miller Divestiture (Details) £ in Millions, $ in Millions | Mar. 01, 2021USD ($) | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Mar. 01, 2021GBP (£) |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Tax exempt gain on sale | $ 359 | $ 0 | ||
Miller [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Final total consideration received from sale of subsidiary | $ 818 | £ 623 | ||
Miller [Member] | Other Income, Net [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Tax exempt gain on sale | $ 356 |
Divestitures - Max Matthiessen
Divestitures - Max Matthiessen Divestiture (Details) kr in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | ||
Sep. 30, 2020USD ($) | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Sep. 30, 2020SEK (kr) | |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Tax exempt gain on sale | $ 359 | $ 0 | ||
Max Matthiessen [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Total consideration received from sale of subsidiary | $ 262 | kr 2,300 | ||
Notes receivable repayable by purchaser | 68 | kr 600 | ||
Max Matthiessen [Member] | Other Income, Net [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Tax exempt gain on sale | $ 86 | |||
Max Matthiessen [Member] | Minimum [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Disposal group including discontinued operation notes payable interest rate | 5.00% | |||
Max Matthiessen [Member] | Maximum [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Disposal group including discontinued operation notes payable interest rate | 10.00% |
Revenue - Schedule of Disaggreg
Revenue - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 2,562 | $ 2,434 | |
Reimbursable expenses and other | [1] | 9 | 27 |
Interest and other income | [2] | 28 | 32 |
Total revenue | 2,590 | 2,466 | |
HCB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 883 | 855 | |
Reimbursable expenses and other | [1] | 11 | 15 |
Interest and other income | [2] | 3 | 10 |
Total revenue | 886 | 865 | |
CRB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 790 | 721 | |
Interest and other income | [2] | 20 | 18 |
Total revenue | 810 | 739 | |
IRR [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 605 | 615 | |
Reimbursable expenses and other | [1] | 1 | 3 |
Interest and other income | [2] | 1 | 3 |
Total revenue | 606 | 618 | |
BDA [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 286 | 234 | |
Reimbursable expenses and other | [1] | 2 | 3 |
Interest and other income | [2] | 3 | |
Total revenue | 289 | 234 | |
Corporate, Non-Segment | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | (2) | 9 |
Reimbursable expenses and other | [1] | (5) | 6 |
Interest and other income | [1],[2] | 1 | 1 |
Total revenue | [1] | (1) | 10 |
Broking [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,378 | 1,262 | |
Broking [Member] | HCB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 97 | 83 | |
Broking [Member] | CRB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 717 | 648 | |
Broking [Member] | IRR [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 412 | 433 | |
Broking [Member] | BDA [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 152 | 98 | |
Consulting [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 763 | 724 | |
Consulting [Member] | HCB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 594 | 582 | |
Consulting [Member] | CRB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 44 | 47 | |
Consulting [Member] | IRR [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 123 | 93 | |
Consulting [Member] | Corporate, Non-Segment | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 2 | 2 |
Outsourced administration [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 293 | 289 | |
Outsourced administration [Member] | HCB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 132 | 128 | |
Outsourced administration [Member] | CRB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 25 | 25 | |
Outsourced administration [Member] | IRR [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 4 | 3 | |
Outsourced administration [Member] | BDA [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 132 | 133 | |
Other [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 119 | 132 | |
Other [Member] | HCB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 49 | 47 | |
Other [Member] | CRB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 4 | 1 | |
Other [Member] | IRR [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 65 | 83 | |
Other [Member] | Corporate, Non-Segment | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 1 | 1 |
Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,553 | 2,407 | |
Service | HCB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 872 | 840 | |
Service | CRB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 790 | 721 | |
Service | IRR [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 604 | 612 | |
Service | BDA [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 284 | 231 | |
Service | Corporate, Non-Segment | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | $ 3 | $ 3 |
[1] | Reimbursable expenses and other, as well as Corporate revenue, are excluded from segment revenue, but included in total revenue on the condensed consolidated statements of comprehensive income. Amounts included in Corporate revenue may include eliminations and impacts from hedged revenue transactions. | ||
[2] | Interest and other income is included in segment revenue and total revenue, however it has been presented separately in the above tables because it does not arise directly from contracts with customers. |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation Of Revenue [Line Items] | ||
Contract with Customer, Performance Obligation Satisfied in Previous Period | $ 23 | |
December 31 2020 [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Contract with Customer, Liability, Revenue Recognized | $ 275 | |
Maximum [Member] | Other [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Revenue, Percentage of Total Revenue | 5.00% | 5.00% |
Revenue - Schedule of Revenue b
Revenue - Schedule of Revenue by Geography (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 2,562 | $ 2,434 | |
Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,553 | 2,407 | |
Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,553 | 2,407 | |
Corporate, Non-Segment | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | (2) | 9 |
Corporate, Non-Segment | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 3 | 3 |
HCB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 883 | 855 | |
HCB [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 872 | 840 | |
HCB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 872 | 840 | |
CRB [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 790 | 721 | |
CRB [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 790 | 721 | |
CRB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 790 | 721 | |
IRR [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 605 | 615 | |
IRR [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 604 | 612 | |
IRR [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 604 | 612 | |
BDA [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 286 | 234 | |
BDA [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 284 | 231 | |
BDA [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 284 | 231 | |
North America [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,185 | 1,110 | |
North America [Member] | Corporate, Non-Segment | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 2 | 2 | |
North America [Member] | HCB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 468 | 476 | |
North America [Member] | CRB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 247 | 233 | |
North America [Member] | IRR [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 186 | 170 | |
North America [Member] | BDA [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 282 | 229 | |
Great Britain [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 613 | 584 | |
Great Britain [Member] | HCB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 147 | 126 | |
Great Britain [Member] | CRB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 155 | 137 | |
Great Britain [Member] | IRR [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 311 | 321 | |
Western Europe [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 492 | 477 | |
Western Europe [Member] | Corporate, Non-Segment | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 1 | 1 | |
Western Europe [Member] | HCB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 171 | 156 | |
Western Europe [Member] | CRB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 261 | 244 | |
Western Europe [Member] | IRR [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 59 | 76 | |
International [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 263 | 236 | |
International [Member] | HCB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 86 | 82 | |
International [Member] | CRB [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 127 | 107 | |
International [Member] | IRR [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 48 | 45 | |
International [Member] | BDA [Member] | Operating Segments [Member] | Service | |||
Disaggregation Of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 2 | $ 2 | |
[1] | Reimbursable expenses and other, as well as Corporate revenue, are excluded from segment revenue, but included in total revenue on the condensed consolidated statements of comprehensive income. Amounts included in Corporate revenue may include eliminations and impacts from hedged revenue transactions. |
Revenue - Schedule of Contract
Revenue - Schedule of Contract Balances (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Revenue From Contract With Customer [Abstract] | ||
Billed Receivable, Current | $ 1,727 | $ 1,697 |
Unbilled Receivable, Current | 508 | 445 |
Contract asset, Current | 334 | 413 |
Accounts receivable, net | 2,569 | 2,555 |
Non-current accounts receivable, net | 22 | 34 |
Contract asset, Noncurrent | 380 | 329 |
Deferred revenue | $ 620 | $ 549 |
Revenue - Schedule of Contrac_2
Revenue - Schedule of Contract Balances (Parenthetical) (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Revenue From Contract With Customer [Abstract] | ||
Allowance for doubtful debts | $ 44 | $ 41 |
Revenue - Schedule of Remaining
Revenue - Schedule of Remaining Performance Obligations (Details) $ in Millions | Mar. 31, 2021USD ($) |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation | $ 1,331 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-04-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation | $ 429 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation | $ 426 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation | $ 476 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period |
Revenue - Schedule of Remaini_2
Revenue - Schedule of Remaining Performance Obligations (Details1) $ in Millions | Mar. 31, 2021USD ($) |
Revenue From Contract With Customer [Abstract] | |
Revenue, Remaining Performance Obligation | $ 1,331 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 4 |
Number of reportable segments | 4 |
Segment Information - Revenue (
Segment Information - Revenue (Net of Reimbursable Expenses) of the Reported Segments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 2,590 | $ 2,466 |
Income from operations | 452 | 360 |
HCB [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 886 | 865 |
CRB [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 810 | 739 |
IRR [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 606 | 618 |
BDA [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 289 | 234 |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 2,577 | 2,435 |
Income from operations | 679 | 606 |
Operating Segments [Member] | HCB [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 875 | 850 |
Income from operations | 220 | 213 |
Operating Segments [Member] | CRB [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 810 | 739 |
Income from operations | 162 | 127 |
Operating Segments [Member] | IRR [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 605 | 615 |
Income from operations | 290 | 277 |
Operating Segments [Member] | BDA [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 287 | 231 |
Income from operations | $ 7 | $ (11) |
Segment Information - Reconcili
Segment Information - Reconciliation of Information Reported by Segment to Condensed Consolidated Statement of Comprehensive Income Amounts (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Revenue: | |||
Revenue | $ 2,590 | $ 2,466 | |
Income/(loss) from operations | 452 | 360 | |
Amortization | (103) | (121) | |
Interest expense | (59) | (61) | |
Other income, net | 439 | 92 | |
Income from operations before income taxes | 832 | 391 | |
Operating Segments [Member] | |||
Revenue: | |||
Revenue | 2,577 | 2,435 | |
Income/(loss) from operations | 679 | 606 | |
Segment Reconciling Items [Member] | |||
Revenue: | |||
Revenue | 13 | 31 | |
Amortization | (103) | (121) | |
Transaction and integration expenses | [1] | (24) | (9) |
Unallocated, net | [2] | (100) | (116) |
Interest expense | (59) | (61) | |
Other income, net | $ 439 | $ 92 | |
[1] | Includes mainly transaction costs related to the proposed Aon combination. | ||
[2] | Includes certain costs, primarily related to corporate functions which are not directly related to the segments, and certain differences between budgeted expenses determined at the beginning of the year and actual expenses that we report for U.S. GAAP purposes. |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | ||
Provision for income taxes | $ 96 | $ 78 |
Effective tax rate | 11.50% | 20.00% |
Liabilities for uncertain tax positions | $ 49 | |
Minimum [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Expected decrease in liability for uncertain tax position | 4 | |
Maximum [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Expected decrease in liability for uncertain tax position | $ 8 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Components of Goodwill (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, gross, beginning balance | $ 11,696 |
Accumulated impairment losses, beginning balance | (492) |
Goodwill, net, beginning balance | 11,204 |
Goodwill disposals | (188) |
Foreign exchange | (30) |
Goodwill, gross, ending balance | 11,478 |
Accumulated impairment losses, ending balance | (492) |
Goodwill, net, ending balance | 10,986 |
HCB [Member] | |
Goodwill [Roll Forward] | |
Goodwill, gross, beginning balance | 4,346 |
Accumulated impairment losses, beginning balance | (130) |
Goodwill, net, beginning balance | 4,216 |
Goodwill disposals | 0 |
Foreign exchange | (17) |
Goodwill, gross, ending balance | 4,329 |
Accumulated impairment losses, ending balance | (130) |
Goodwill, net, ending balance | 4,199 |
CRB [Member] | |
Goodwill [Roll Forward] | |
Goodwill, gross, beginning balance | 2,378 |
Accumulated impairment losses, beginning balance | (362) |
Goodwill, net, beginning balance | 2,016 |
Goodwill disposals | 0 |
Foreign exchange | (16) |
Goodwill, gross, ending balance | 2,362 |
Accumulated impairment losses, ending balance | (362) |
Goodwill, net, ending balance | 2,000 |
IRR [Member] | |
Goodwill [Roll Forward] | |
Goodwill, gross, beginning balance | 1,694 |
Accumulated impairment losses, beginning balance | 0 |
Goodwill, net, beginning balance | 1,694 |
Goodwill disposals | (188) |
Foreign exchange | 3 |
Goodwill, gross, ending balance | 1,509 |
Accumulated impairment losses, ending balance | 0 |
Goodwill, net, ending balance | 1,509 |
BDA [Member] | |
Goodwill [Roll Forward] | |
Goodwill, gross, beginning balance | 3,278 |
Accumulated impairment losses, beginning balance | 0 |
Goodwill, net, beginning balance | 3,278 |
Goodwill disposals | 0 |
Foreign exchange | 0 |
Goodwill, gross, ending balance | 3,278 |
Accumulated impairment losses, ending balance | 0 |
Goodwill, net, ending balance | $ 3,278 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Changes in the Net Carrying Amount of the Components of Finite-Lived Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Finite-lived Intangible Assets [Roll Forward] | |||
Finite-lived intangible assets, gross carrying amount | $ 5,774 | $ 5,988 | |
Finite-lived intangible assets, accumulated amortization | (2,896) | (2,945) | |
Finite-lived intangible assets, net amount | 2,878 | 3,043 | |
Intangible asset disposals | (54) | ||
Amortization | (103) | $ (121) | |
Foreign exchange | (8) | ||
Client relationships [Member] | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Finite-lived intangible assets, gross carrying amount | 3,865 | 4,065 | |
Finite-lived intangible assets, accumulated amortization | (1,956) | (2,031) | |
Finite-lived intangible assets, net amount | 1,909 | 2,034 | |
Intangible asset disposals | (46) | ||
Amortization | (69) | ||
Foreign exchange | (10) | ||
Software [Member] | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Finite-lived intangible assets, gross carrying amount | 759 | 761 | |
Finite-lived intangible assets, accumulated amortization | (676) | (659) | |
Finite-lived intangible assets, net amount | 83 | 102 | |
Intangible asset disposals | 0 | ||
Amortization | (19) | ||
Foreign exchange | 0 | ||
Trademark and trade name [Member] | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Finite-lived intangible assets, gross carrying amount | 1,040 | 1,054 | |
Finite-lived intangible assets, accumulated amortization | (225) | (220) | |
Finite-lived intangible assets, net amount | 815 | 834 | |
Intangible asset disposals | (8) | ||
Amortization | (11) | ||
Foreign exchange | 0 | ||
Other [Member] | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Finite-lived intangible assets, gross carrying amount | 110 | 108 | |
Finite-lived intangible assets, accumulated amortization | (39) | (35) | |
Finite-lived intangible assets, net amount | 71 | $ 73 | |
Intangible asset disposals | 0 | ||
Amortization | (4) | ||
Foreign exchange | $ 2 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Finite-lived Intangible Assets [Roll Forward] | |
Weighted average remaining life of amortizable intangible assets | 13 years 4 months 24 days |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Schedule of Future Estimated Amortization Expense for Amortizable Intangible Assets (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
Remainder of 2021 | $ 268 | |
2022 | 308 | |
2023 | 257 | |
2024 | 224 | |
2025 | 205 | |
Thereafter | 1,616 | |
Total | $ 2,878 | $ 3,043 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Derivative [Line Items] | ||
Gains on derivatives to be reclassified within the next twelve months | $ 6 | |
Maximum [Member] | ||
Derivative [Line Items] | ||
Longest outstanding maturity | 1 year 8 months 12 days | |
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts [Member] | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 1,500 | $ 1,500 |
Derivative liability, fair value | 1 | |
Derivative assets, fair value | 15 | |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Miller [Member] | ||
Derivative [Line Items] | ||
Derivative, notional amount | 27 | |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Foreign exchange contracts [Member] | ||
Derivative [Line Items] | ||
Derivative, notional amount | 249 | 340 |
Derivative assets, fair value | $ 8 | $ 5 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Schedule of Derivative Instruments Designated As Hedging Instrument Effect on Condensed Consolidated Statements of Comprehensive Income (Details) - Cash Flow Hedging [Member] - Designated as Hedging Instrument [Member] - Foreign exchange contracts [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Derivative [Line Items] | ||
Gain/(loss) recognized in OCI (effective element) | $ 4 | $ (24) |
(Loss)/gain reclassified from Accumulated OCL into income (effective element) | 1 | (2) |
Revenue [Member] | ||
Derivative [Line Items] | ||
(Loss)/gain reclassified from Accumulated OCL into income (effective element) | (2) | 0 |
Salaries and Benefits [Member] | ||
Derivative [Line Items] | ||
(Loss)/gain reclassified from Accumulated OCL into income (effective element) | $ 3 | $ (2) |
Derivative Financial Instrume_5
Derivative Financial Instruments - Schedule of Derivative Instruments, Effect on Condensed Consolidated Statements of Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Other income, net [Member] | Not Designated as Hedging Instrument [Member] | Foreign exchange contracts [Member] | ||
Derivative [Line Items] | ||
Loss recognized in income | $ (16) | $ (12) |
Debt - Schedule of Current and
Debt - Schedule of Current and Long-term Debt (Details) € in Millions | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Mar. 31, 2021EUR (€) | ||||
Debt Instrument [Line Items] | ||||||
Current debt | $ 471,000,000 | $ 971,000,000 | ||||
Long-term debt, excluding current maturities | 4,632,000,000 | 4,664,000,000 | ||||
Revolving 1.25 Billion Dollar Credit Facility [Member] | Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | [1] | $ 1,250,000,000 | ||||
Line of credit maturity date | Mar. 7, 2022 | |||||
5.750% senior notes due 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Current debt | $ 500,000,000 | |||||
Stated interest rate | 5.75% | 5.75% | 5.75% | |||
Debt instrument maturity year | 2021 | 2021 | ||||
3.500% senior notes due 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Current debt | $ 450,000,000 | $ 449,000,000 | ||||
Stated interest rate | 3.50% | 3.50% | 3.50% | |||
Debt instrument maturity year | 2021 | 2021 | ||||
Collateralized Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Current portion of long term debt | $ 21,000,000 | $ 22,000,000 | ||||
Long-term debt, excluding current maturities | [2] | 27,000,000 | 33,000,000 | |||
Renewal commissions receivables pledged as collateral | $ 92,000,000 | $ 98,000,000 | ||||
2.125% senior notes due 2022 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 2.125% | 2.125% | 2.125% | |||
Debt instrument maturity year | 2022 | 2022 | ||||
Long-term debt, excluding current maturities | $ 633,000,000 | [3] | $ 659,000,000 | [3] | € 540 | |
4.625% senior notes due 2023 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 4.625% | 4.625% | 4.625% | |||
Debt instrument maturity year | 2023 | 2023 | ||||
Long-term debt, excluding current maturities | $ 249,000,000 | $ 249,000,000 | ||||
3.600% senior notes due 2024 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 3.60% | 3.60% | 3.60% | |||
Debt instrument maturity year | 2024 | 2024 | ||||
Long-term debt, excluding current maturities | $ 647,000,000 | $ 647,000,000 | ||||
4.400% senior notes due 2026 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 4.40% | 4.40% | 4.40% | |||
Debt instrument maturity year | 2026 | 2026 | ||||
Long-term debt, excluding current maturities | $ 546,000,000 | $ 546,000,000 | ||||
4.500% senior notes due 2028 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 4.50% | 4.50% | 4.50% | |||
Debt instrument maturity year | 2028 | 2028 | ||||
Long-term debt, excluding current maturities | $ 596,000,000 | $ 596,000,000 | ||||
2.950% senior notes due 2029 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 2.95% | 2.95% | 2.95% | |||
Debt instrument maturity year | 2029 | 2029 | ||||
Long-term debt, excluding current maturities | $ 726,000,000 | $ 726,000,000 | ||||
6.125% senior notes due 2043 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 6.125% | 6.125% | 6.125% | |||
Debt instrument maturity year | 2043 | 2043 | ||||
Long-term debt, excluding current maturities | $ 271,000,000 | $ 271,000,000 | ||||
5.050% senior notes due 2048 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 5.05% | 5.05% | 5.05% | |||
Debt instrument maturity year | 2048 | 2048 | ||||
Long-term debt, excluding current maturities | $ 395,000,000 | $ 395,000,000 | ||||
3.875% senior notes due 2049 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 3.875% | 3.875% | 3.875% | |||
Debt instrument maturity year | 2049 | 2049 | ||||
Long-term debt, excluding current maturities | $ 542,000,000 | $ 542,000,000 | ||||
[1] | The $1.25 billion revolving credit facility expires on March 7, 2022. | |||||
[2] | At March 31, 2021 and December 31, 2020, the Company had $92 million and $98 million, respectively, of renewal commissions receivables pledged as collateral for this facility | |||||
[3] | Notes issued in Euro (€540 million). |
Debt - Narrative (Details)
Debt - Narrative (Details) - 5.750% senior notes due 2021 [Member] - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Debt instrument principal and interest payment | $ 500 | |
Stated interest rate | 5.75% | 5.75% |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) $ in Millions | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | |
Contingent consideration [Member] | Fair Value Inputs, Discount Rate [Member] | |||
Liabilities: | |||
Fair value inputs, weighted-average discount rate | 0.1092 | 0.0946 | |
Contingent consideration [Member] | Fair Value Inputs, Discount Rate [Member] | Minimum [Member] | |||
Liabilities: | |||
Fair value inputs, weighted-average discount rate | 0.0353 | ||
Contingent consideration [Member] | Fair Value Inputs, Discount Rate [Member] | Maximum [Member] | |||
Liabilities: | |||
Fair value inputs, weighted-average discount rate | 0.1300 | ||
Recurring [Member] | |||
Assets: | |||
Mutual funds / exchange traded funds | $ 9 | $ 8 | |
Derivative financial instruments | [1] | 10 | 27 |
Liabilities: | |||
Contingent consideration | [2] | 28 | 45 |
Derivative financial instruments | [1] | 3 | 7 |
Recurring [Member] | Level 1 [Member] | |||
Assets: | |||
Mutual funds / exchange traded funds | 9 | 8 | |
Derivative financial instruments | [1] | 0 | 0 |
Liabilities: | |||
Contingent consideration | [2] | 0 | 0 |
Derivative financial instruments | [1] | 0 | 0 |
Recurring [Member] | Level 2 [Member] | |||
Assets: | |||
Mutual funds / exchange traded funds | 0 | 0 | |
Derivative financial instruments | [1] | 10 | 27 |
Liabilities: | |||
Contingent consideration | [2] | 0 | 0 |
Derivative financial instruments | [1] | 3 | 7 |
Recurring [Member] | Level 3 [Member] | |||
Assets: | |||
Mutual funds / exchange traded funds | 0 | 0 | |
Derivative financial instruments | [1] | 0 | 0 |
Liabilities: | |||
Contingent consideration | [2] | 28 | 45 |
Derivative financial instruments | [1] | $ 0 | $ 0 |
[1] | See Note 8 — Derivative Financial Instruments for further information on our derivative investments. | ||
[2] | Probability weightings are based on our knowledge of the past and planned performance of the acquired entity to which the contingent consideration applies. The fair value weighted-average discount rates used on our material contingent consideration calculations were 10.92% and 9.46% at March 31, 2021 and December 31, 2020, respectively. The range of these discount rates was 3.53% - 13.00% at March 31, 2021. Using different probability weightings and discount rates could result in an increase or decrease of the contingent consideration payable. |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Liabilities Measured Using Significant Unobservable Inputs Level 3 (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance as of beginning of period | $ 45 |
Payments | (17) |
Balance as of end of period | $ 28 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Fair Value Disclosures [Abstract] | |
Fair value significant transfers to or from Level 3 | $ 0 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Liabilities Whose Carrying Values Differ From the Fair Value and are Not Measured on a Recurring Basis (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current debt | $ 471 | $ 971 |
Long-term debt | 4,632 | 4,664 |
Carrying Value [Member] | Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term note receivable | 67 | 71 |
Current debt | 471 | 971 |
Long-term debt | 4,632 | 4,664 |
Fair Value [Member] | Nonrecurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term note receivable | 69 | 73 |
Current debt | 476 | 985 |
Long-term debt | $ 5,141 | $ 5,488 |
Retirement Benefits - Narrative
Retirement Benefits - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Compensation and Retirement Disclosure [Line Items] | ||
Portion of pension and OPEB obligation attributed to disclosed plans (as a percent) | 99.00% | |
Defined contribution plan, employer contribution | $ 43,000,000 | $ 43,000,000 |
Pension Plan [Member] | United States [Member] | ||
Compensation and Retirement Disclosure [Line Items] | ||
Defined benefit pension plans, employer contributions | 60,000,000 | |
Defined benefit plan, estimated future employer additional contributions, remainder of fiscal year | 0 | |
Pension Plan [Member] | United Kingdom [Member] | ||
Compensation and Retirement Disclosure [Line Items] | ||
Defined benefit pension plans, employer contributions | 10,000,000 | |
Defined benefit plan, estimated future employer additional contributions, remainder of fiscal year | 31,000,000 | |
Pension Plan [Member] | Other Foreign Plans [Member] | ||
Compensation and Retirement Disclosure [Line Items] | ||
Defined benefit pension plans, employer contributions | 16,000,000 | |
Defined benefit plan, estimated future employer additional contributions, remainder of fiscal year | $ 9,000,000 |
Retirement Benefits - Net Perio
Retirement Benefits - Net Periodic Benefit Cost (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Pension Plan [Member] | United States [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 20 | $ 18 |
Interest cost | 23 | 33 |
Expected return on plan assets | (77) | (73) |
Settlement | 1 | 0 |
Amortization of net loss | 11 | 9 |
Amortization of prior service credit | 0 | 0 |
Net periodic benefit (income)/cost | (22) | (13) |
Pension Plan [Member] | United Kingdom [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 4 | 4 |
Interest cost | 14 | 18 |
Expected return on plan assets | (43) | (62) |
Settlement | 0 | 0 |
Amortization of net loss | 7 | 6 |
Amortization of prior service credit | (4) | (4) |
Net periodic benefit (income)/cost | (22) | (38) |
Pension Plan [Member] | Other Foreign Plans [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 6 | 5 |
Interest cost | 3 | 4 |
Expected return on plan assets | (9) | (8) |
Settlement | 0 | 0 |
Amortization of net loss | 1 | 0 |
Amortization of prior service credit | 0 | 0 |
Net periodic benefit (income)/cost | 1 | 1 |
PRW [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 0 | 0 |
Interest cost | 0 | 1 |
Expected return on plan assets | 0 | 0 |
Settlement | 0 | 0 |
Amortization of net loss | 0 | 0 |
Amortization of prior service credit | (1) | (1) |
Net periodic benefit (income)/cost | $ (1) | $ 0 |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Costs Recorded in Condensed Consolidated Statements of Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Finance lease cost: | ||
Amortization of right-of-use assets | $ 1 | |
Interest on lease liabilities | $ 1 | 1 |
Operating lease cost | 46 | 47 |
Variable lease cost | 13 | 10 |
Sublease income | (5) | (5) |
Total lease cost, net | $ 55 | $ 54 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | Nov. 19, 2020 | Feb. 28, 2021 | Dec. 31, 2020 | Mar. 31, 2021 |
Loss Contingencies [Line Items] | ||||
Insurance recovery receivables | $ 25 | $ 2 | ||
Settled Litigation [Member] | Merger-Related Securities Litigation [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation settlement amount | $ 90 | |||
Provision for litigation losses | 65 | |||
Insurance recovery receivables | $ 25 | |||
Settled Litigation [Member] | Merger-Related Securities Litigation [Member] | Federal Action [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation settlement amount | $ 75 | |||
Settled Litigation [Member] | Merger-Related Securities Litigation [Member] | Delaware Action [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation settlement amount | $ 15 |
Supplementary Information for_3
Supplementary Information for Certain Balance Sheet Accounts - Prepaid and Other Current Assets (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||||
Prepayments and accrued income | $ 138 | $ 124 | ||
Deferred contract costs | 74 | 108 | ||
Derivatives and investments | 26 | 42 | ||
Deferred compensation plan assets | 13 | 14 | ||
Retention incentives | 7 | 3 | ||
Corporate income and other taxes | 99 | 83 | ||
Insurance and other recovery receivables | 2 | 25 | ||
Restricted cash | 6 | 7 | $ 8 | $ 8 |
Acquired renewal commissions receivable | 14 | 16 | ||
Other current assets | 53 | 75 | ||
Total prepaid and other current assets | $ 432 | $ 497 |
Supplementary Information for_4
Supplementary Information for Certain Balance Sheet Accounts - Deferred Revenue and Accrued Expenses (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||
Accounts payable, accrued liabilities and deferred income | $ 913 | $ 862 |
Accrued discretionary and incentive compensation | 383 | 851 |
Litigation settlements | 210 | |
Accrued vacation | 182 | 161 |
Other employee-related liabilities | 48 | 77 |
Total deferred revenue and accrued expenses | $ 1,526 | $ 2,161 |
Supplementary Information for_5
Supplementary Information for Certain Balance Sheet Accounts - Provision For Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||
Claims, lawsuits and other proceedings | $ 316 | $ 325 |
Other provisions | 74 | 82 |
Total provision for liabilities | $ 390 | $ 407 |
Other Income, Net (Details)
Other Income, Net (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Other Income And Expenses [Abstract] | ||
Gain on disposal of operations | $ 359 | $ 0 |
Net periodic pension and postretirement benefit credits | 76 | 76 |
Interest in earnings of associates and other investments | 2 | 2 |
Foreign exchange gain | 2 | 12 |
Other | 0 | 2 |
Other income, net | $ 439 | $ 92 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' equity attributable to parent, beginning balance | $ 10,820 | |
Stockholders' equity attributable to parent, ending balance | 11,526 | |
Foreign currency translation [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' equity attributable to parent, beginning balance | (400) | $ (538) |
Other comprehensive income/(loss) before reclassifications | (42) | (208) |
Amounts reclassified from accumulated other comprehensive income/(loss) (net of income tax) | 44 | 0 |
Net current-period other comprehensive income/(loss) | 2 | (208) |
Stockholders' equity attributable to parent, ending balance | (398) | (746) |
Derivative instruments [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' equity attributable to parent, beginning balance | 9 | 13 |
Other comprehensive income/(loss) before reclassifications | 7 | (19) |
Amounts reclassified from accumulated other comprehensive income/(loss) (net of income tax) | (1) | 1 |
Net current-period other comprehensive income/(loss) | 6 | (18) |
Stockholders' equity attributable to parent, ending balance | 15 | (5) |
Defined pension and post-retirement benefit costs [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' equity attributable to parent, beginning balance | (1,968) | (1,702) |
Other comprehensive income/(loss) before reclassifications | 1 | (4) |
Amounts reclassified from accumulated other comprehensive income/(loss) (net of income tax) | 39 | 11 |
Net current-period other comprehensive income/(loss) | 40 | 7 |
Stockholders' equity attributable to parent, ending balance | (1,928) | (1,695) |
Total [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' equity attributable to parent, beginning balance | (2,359) | (2,227) |
Other comprehensive income/(loss) before reclassifications | (34) | (231) |
Amounts reclassified from accumulated other comprehensive income/(loss) (net of income tax) | 82 | 12 |
Net current-period other comprehensive income/(loss) | 48 | (219) |
Stockholders' equity attributable to parent, ending balance | $ (2,311) | $ (2,446) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Income (Loss) (Parenthetical) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Reclassification from AOCI, Current Period, Tax | $ 6 | $ 0 |
Miller [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Reclassifications of foreign currency translation | 44 | |
Reclassifications of defined pension and post-retirement benefits costs | $ 31 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Restricted share units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 0.2 | 0 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 0 | 0 |
Time-based award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding | 0.1 | 0.2 |
Performance-Based Stock Units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options outstanding | 0.3 | 0.3 |
Restricted share units outstanding | 0.5 | 0.3 |
Earnings Per Share - Basic and
Earnings Per Share - Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Earnings Per Share [Abstract] | ||
Net income attributable to Willis Towers Watson | $ 733 | $ 305 |
Basic average number of shares outstanding (shares) | 130 | 130 |
Dilutive effect of potentially issuable shares (shares) | 0 | 0 |
Diluted average number of shares outstanding (shares) | 130 | 130 |
Basic earnings per share | $ 5.64 | $ 2.36 |
Dilutive effect of potentially issuable shares (USD per share) | (0.01) | (0.02) |
Diluted earnings per share | $ 5.63 | $ 2.34 |