Morning. We're going to continue on with our schedule. I'm Greg Peters, and I cover a slew of insurance-related stocks and insurance brokerage companies, including our next presenter, Willis Towers Watson. It's an honor, really, to welcome them back to our conference. They've been a longstanding participant, either through Willis Towers Watson or the legacy company, Towers Watson. We certainly appreciate their participation. Right now, as I look across my coverage list, this is, in the insurance brokerage space, my top pick for the year from a valuation perspective, from an operating performance perspective, and from a growth perspective. In fact, the entire outlook for the insurance brokerage space is quite positive due in part to the substantial amounts of recurring revenue, the positive nature of the EBITDA margins, and free cash flow, of course.
From management today, presenting, we have Nathan Han, who serves in the investor relations role for the company, and then we have Mike Burwell, who is the chief financial officer. So I'm going to turn the podium over to Mike.
Thanks, Greg. Excited to spend a little bit of time with you today talking about what's going on at Willis Towers Watson and talk about our company. Obviously, the obligatory thoughts I need to put out there. If I look at it overall, we've been a business that's continued to grow at a pretty good clip from an organic growth standpoint. If you look back, Willis Towers Watson, it came together from the formation of Towers Watson and Willis back in 2016. As a business that continued to get its organic growth in order. We got it in order. We continue to see ourselves growing at a consistent rate with where the market has been growing. In fact, through the end of last year, in fiscal year 2019, we had overall organic growth of 5%.
We were pretty happy with that and pretty consistent with what we had seen in the marketplace, an overall growth of 9%. I think we have an organization, as I say in that first point here, that's continued to move in a very positive direction. I think we have an executive team that's been together, that works well together overall. Obviously, we've been looking to create value, and we've seen that happen reflected in our share price over the last several years. Obviously, a continued focus. We've seen the revenue growth rate, we've seen improvement in margin, and we want to continue to see consistency in the delivery of our free cash flow, which is a continued focal point of the company. Again, roots date back to the 1800s, just in terms of the company's overall profile.
Just to put it in perspective, as I was mentioning, we're about $9 billion in revenue. $1.8 billion of adjusted operating margin, or 20.3%, that we delivered for fiscal year 2019. Roughly 45,000 colleagues spread out in 141 countries in which we operate, or 140, as I said there. If you look at the mix, you see it really broken down into four segments. Our Human Capital and Benefits, and we'll dive into these in a little bit more detail, represents roughly 37% of the business. 12% is Benefits Delivery and Administration, 18% Investment Risk and Reinsurance, and 33% Corporate Risk and Brokering, or as we refer to it, as our CRB business. If you look at it from a geographic standpoint, about 51% of it in North America, 22% in GB, or Great Britain, 16% in Western Europe, the remainder in international.
We're serving about 91% of the Fortune 1000, 93% of the global Fortune 500, and 95% of the FTSE 100. Interesting thing about our business is that at the beginning of the year, we roughly know 85% of our revenue. We have multi-year arrangements with our clients. I'm not taking anything away from that we need to obviously service those clients and never take them for granted. Nonetheless, we have a lot of stickiness. When we think about upturns, downturns, or changes in markets, it really positions the business quite well in terms of its ability to continue to perform in up markets and down markets. We feel very good about that. As I say, we really operate in four segments. Just as I said, you got a snapshot of the overall company. Let's dive into these just in a little bit more detail.
Our Human Capital and Benefits business is our largest segment. We are, at least in our assessment, one of the largest actuaries, if not the largest actuary in the world in our retirement business. We don't see a lot of new DB plans coming on board, nonetheless, we're very sticky in terms of how it is that we continue to serve our clients in that sector. We have roughly a 98% retention rate of our clients. In many ways, we've become their backbone or back office in terms of supporting them as they think about de-risking their plans and continue to look at various alternatives around those plans. I don't see those plans going away anytime soon, and continues to be a very good source for us overall.
Also, I would say there has been a real growth element in Human Capital and Benefits is been our health and benefits brokerage activity. As we continue to deliver health and benefits alternatives for our clients, we've seen the growth there being very significant in double-digit type of growth, in that particular space. We don't see that abating anytime soon. We think in the Human Capital and Benefits area, we have industry-leading margins and are very excited about that particular segment. If I move down to our Corporate Risk and Brokering, you'd think about that as traditional overall insurance brokering activities that we're doing. We continue to see that business as opportunity for margin improvement over the next several years. We've continued to see, we did over 130 basis points improvement in operating margin in that business in fiscal year 2019.
We still see us having a gap versus the market of 5% or 6%, so that's an area that we're continuing to focus on to close that gap in our CRB business. The other thing is we saw organic growth in that segment in the fourth quarter of 9%. It's been very, very strong. We have seen a pricing tailwind a bit in this space. We've continued to see an expansion of ability of opportunities, whether it be on our cyber risks that people are looking to take advantage of in terms of us brokering solutions for them. One of the interesting pieces is the amount of data that we have to be able to bring solutions to bear.
We continue to see intangibles growing on companies' balance sheets, and how do they think about managing and dealing with that risk, and we continue to play in that particular space. We see a market that continues to expand with risks and how it is that they think about solving those risks, and it all comes back to data in those conversations, and the market continuing looking for multiple options, that's been a very good business for us. Again, margin opportunity and continue to see growth. If we go to our investment risk and reinsurance business, on the investment side of the house, as much as on the top side in Human Capital and Benefits we deal with retirement, the asset side of the balance sheet is we got about $150 billion of assets under management that we're managing on a delegated basis overall.
Our reinsurance business, Willis Re, has been very strong as, again, as you've seen a bit of a pricing tailwind overall. Our benefits delivery and administration business, I would just highlight to you, is to think about that space as the biggest piece of it is roughly 50 million participants that are there that are looking for Medicare or Medicare supplement type of support. Of that 50 million, you break about 15 million is employer or municipality-supported participants. If you take that 15 million and break seven and a half million down, we're dealing with many companies, the IBMs of the world, so to speak, that are having and looking for us to help manage that process for them. We have a very strong market position there.
Equally, in the municipality space, of that 15 million participants, what we see is the state of Ohio is one of our accounts. Those are very episodic but very strong positioning. Of the 50 million that we see growing over the next 10 years to 70 million potential participants in the Medicare or Medicare supplement space, we're very strong in the employer, as I say, municipality space. We bought a business that's direct-to-consumer back in July of 2019 called TRANZACT that was in the direct-to-consumer space that really deals with the remaining 35 million participants. The reason it's growing from 50 million to 70 million is there's roughly 10,000 people retiring every single day. We see that continuing to grow very strongly, and we see very good margins.
That direct-to-consumer space is a space that we see competing with the likes of the eHealths out there of the world. We see this business as very good margins for us, and we've said 25%-30% CAGR growth rate over a five-year period from when we acquired it. We see very strong views here. Well over 2 million people on our exchanges today, and we continue to see this as a continued very strong growth element. That's what, kind of going back full circle, how we ended up with 9% overall growth for the company, and we ended up at 5% organic growth for the company. This just gives you a little bit of breakdown of the businesses.
As I say, if you do Human Capital and Benefits , you see retirement at 39%, and our H&B business at 38%, our Talent and Rewards at 18%, and our TAS business at 5%. It is really Technology and Administration Solutions . Just to give you an overall sense of the 3.3 breakdown, that is our largest segment of HCB. If you looked at our corporate risk and brokering, roughly we placed $22 billion of client premiums annually.
Again, if you look at the geographic breakdown, what you're seeing here is North America and Western Europe, Great Britain, and then followed by international, and we covered those a bit earlier. Maybe just to give you a little bit more color, I touched on reinsurance and I touched on investment. We have looked at our wholesale business here. We have issued a press release that we are looking at this strategic alternatives.
We have hired Goldman to help us evaluate those strategic alternatives. We're looking at our wholesale business overall. Why? We're looking at it in terms of how it compares with the retail segment, and we're continuing to evaluate what those alternatives may mean in comparison to that retail segment. We also own a business, Max Matthiessen. It's really in the investment space and the underwriting capital management we're in the process of exiting. It's just why you see it just winding itself down. We've also then divested ourselves of roughly 10 businesses. We've continued to look at the portfolio. We will continue to look at geographies that make sense for us, and this is just part of our ongoing evaluation of our portfolio, but I thought it would be appropriate to mention those.
As what I mentioned here, what you see is TRANZACT really having a bigger impact to it. Our benefit outsource and groups marketplace continues to be, again, a very strong performer for us overall and very happy and pleased with the margin performance that we're seeing in this space. I think some guiding principles that we put across the company, obviously it starts in terms of having financial discipline. We think about that is very much based in our CEO, John Haley, in that is that not all revenue is created equal. That we need profitable revenue growth as a starting point, and then obviously we want to see that evidenced by the collection of cash. We obviously strive to maximize the potential of capital in terms of how we deploy it.
At the moment, since we did TRANZACT, we have only been buying back shares to the tune of roughly $100 million-$150 million to make sure we're not dilutive as it relates to our employee benefit programs. We anticipate continued pay-down of debt and then being in a position to reevaluate looking at share buybacks, as we obviously view that as an appropriate opportunity for us to think about our capital allocation. We're very committed to delivering on results. That is across the board. As a result of it, we have not been 100% happy with our free cash flow commitment. Therefore, we have changed or are in the process of changing our bonus programs to make sure they're even more focused on making sure things that we say are important to the company in terms of delivering against those objectives.
This is the guidance we put out for fiscal year 2020. What we've said is overall growth of 6%-7%. We said 4%-5% organic revenue growth overall. As I said, we delivered 5% in fiscal year 2019. Our adjusted operating margin, we're targeting at 20.5%. We delivered 20.3% for fiscal year 2019. I would tell you that we acquired TRANZACT in July. TRANZACT actually we roughly had five months of revenue and five months of expense. When you normalize that margin, that would be more the 30 basis points that was in there as well as FX. I would call it roughly a 50 basis point improvement between 2019 and 2020 in terms of how we're thinking about it.
We tend to target ourselves in that 50-70 basis point improvement on an annual basis in terms of what we can do from a margin standpoint. Our adjusted guidance on EPS is $11.80-$12.10. We delivered $10.96 for fiscal year 2019. We're targeting around $1 billion of free cash flow, which includes the settlement of Stanford, which is roughly, we're anticipating that will indeed get settled in this current year at $120 million. That'll be $1,120 if you looked at it grossed up versus that $1 billion target that we have to be in place. We're estimating around $0.10 of adjusted EPS. The other thing I would say is that we delivered for fiscal year 2019 $830 million of free cash flow. That was a little below what we had said and targeted. Why?
One is that we did see deals actually getting moved more to the December timeframe in terms of them getting concluded with the pricing increases coming in the marketplace. As you were getting a significant price increase on your property and casualty insurance, you were thinking about what alternatives might you think about, whether how much deductibles you wanted, how much risk are you willing to take? How are you thinking about it in your own captives? Those types of decisions really moved themselves into December, versus what we had seen in the prior year. Second, the great news with TRANZACT is that we had seen this growth, but we definitely saw more cash usage to get that growth in terms of bringing on call centers, licensed agents, and our investment that we needed to do, in that particular business.
Third, we saw a higher cash tax rate for ourselves in terms of going through some of the tax legislative changes. We ended up paying a bit more in cash taxes in fiscal year 2019 than we had originally anticipated. Those were the main drivers overall. What are we doing about it to make sure we hit this billion-dollar free cash flow is one, that, like I said, more direct alignment from the operating committee, the leadership of the organization. Roughly 20% of our bonus is driven off of delivering free cash flow, and the same with the top 500 people in the company. Not that we didn't have it before, but this is very direct in terms of its alignment overall. Second, we are launching and have selected a contract management system that will seem to be in place that will give us greater visibility centrally.
Not that we don't have standards and it was getting managed and through our organization, but we have a contract management system that we'll see effects starting to see more impact, I think, over the second half of the year. Third, I've taken some people out of their roles organizationally from contract to cash to total focus on the process and every process breakdown that we can do to enhance it. We're very focused, as I said, around how we continue to drive this overall, and those are the actions that we're indeed taking. What I want you to take away in terms of takeaways, I would say, I think we have a strong foundation to continue to capture market share growth. The organization, we feel very good in terms of where it's positioned and how people feel. Why do I say this?
When we saw one of our competitors have a merger in the marketplace, not uncommon that you would see resumes come to you. We've continued to see a flurry of resumes come to us even before that, and we think that's because of the culture of the company, and that people feel that it's a great place to be. Second, we're very focused on operational enhancements, so that margin expansion, as I talked about, that 50-70 basis point improvement is really what we're focused on. We obviously have a diverse portfolio, as I touched on, that 85% in terms of commitment that we know at the beginning of the year in terms of cash. Revenue, we have a good insight to what that's going to look like throughout the year, as well as margin.
I would leave you that we are very focused in terms of flexibility, but obviously maximizing shareholder value is a key focus of ours overall in terms of delivering to our shareholders. That's top of mind for all of us. That's the things. I'm glad to respond to questions anybody may have or
Well, we have about 10 minutes for questions.
Questions
Then we'll go to breakout.
Okay.
Yes, go ahead.
How do I repeat the question?
Can you repeat the question?
It's for the video? Yes.
Just a question on your organic growth. You've done a good job with the motivated organic growth, I believe it's picked up over time. When you look out over the next two to three years, can you see that as a pretty good line of sight to organic growth that's driving, too, this year and then perhaps maybe later on? How should we think about it? Where does it come from? I don't know, but what is the line of thinking behind it?
Yeah.
I'm just trying to understand that part.
Yeah. The question I heard was, as you look at organic growth and you've seen an improvement and a trajectory there, how should you be thinking about organic growth into the future based on what's actually happening in the business? Did I capture that question right?
Yes.
Yeah. What we've seen is we have seen a bit of a tailwind as it relates to price. I would tell you, in our minds, it's around 1%, 1%-1.5%, depending on the business line itself. That's what we've seen. We obviously saw TRANZACT adding to our overall growth and should add to the growth story. Obviously, it won't be on same-store sales until July or to the end of the year in terms of what that will mean for us. I think really in that 4%-5% range is really what we think about the business itself. Could it go a bit higher? It's possible. I think that would really be the right view in terms of how to think about it. Thank you for that question. Other questions?
Can you talk about market share trends in the various businesses?
Yeah. The question is, can I talk about market share for the various businesses? I can give you some indications of it. When we look at our HCB business, we feel we're really the dominant player in the retirement space. Some of our competitors take the retirement business and mirror it with their investment business. We break it out separately, so you see retirement sit in our HCB segment, and you see retirement business sitting in our IRR segment overall. We think we're in a very strong market position, maybe leading market position in the retirement space overall. Health and benefits, again, I would tell us, I think we're in the top couple, in health and benefits brokering, in our mind, in terms of where we're positioned.
As you think about the Talent and Rewards business is a much wider market space, although we've been playing at the high end in terms of executive compensation as people think about executive compensation. It depends on how you parse that market share up. We have not gone into a lot of the online stuff that's been there, that we have looked at more commodity-based, and we frankly don't see it disrupting many of the businesses and the activities that we're doing. If I go to our CRB business, it really depends on where you are in the world. The business itself, the legacy Willis business started in Europe, it had a very strong market position in the FTSE 100. It had acquired the HRH business and then moved in the middle market space in the U.S.
I'd say, if you looked at us in Europe, we're in the top three. In certain markets, we're number one, for example, in France. I'd equally tell you, in the U.S., we're in the top five. It just depends on where you sit. We have very strong competitors in the U.S. marketplace overall, obviously a global network. If you go to our reinsurance business, there's principally three, we're one of three. I would argue maybe we're third in that category if you just look at it in terms of scale. Our investment business, we're at $150 billion of assets under management, our two direct competitors have about $100 billion more, there's a good reason for that.
Because we were dominant in the retirement space, and moving to the asset management side, it was very difficult, almost some might say conflicting, to be in a situation to recommend that you go to a delegated asset manager, when you're the advisor. We were a bit behind, given our market position in the retirement side, moving to the asset side of the balance sheet. Although we've continued to grow very strongly there was a reason to how we got to that level of position. The Max Matthiessen business is in a very strong market position of where it sits in Sweden. In the wholesale business, again, I would tell you in the top five wholesalers that are out there in terms of market position. In the BDA segment, I think we're the dominant player, frankly, in that space.
Dominant is probably the wrong word, let's put a top market share and where we sit in the BDA space. Hopefully that is responsive to your thinking and question. A question, yeah?
One of your peers, one of your competitors emphasized data and analytics as a very important piece and an important element to their growth.
How do I think about it as it relates to Willis Towers Watson? I think data analytics is a very key ingredient. Data is at the essence of the process. As brokers, we have a plethora of data, and how do we monetize that data is an important element, first for our clients, and then obviously for us as part of that. Historically, we have a group called ICT, Insurance Consulting and Technology, that sits in our IRR segment. We've been consulting with insurance carriers for many, many years and developing new products and offerings for them. I would call it data analytics to be there. We're doing a variety of different things in that space. Let me use an example. One of the things we're doing, particularly in the shipping industry, is working to make sure there's an IoT device that's sitting on a container.
That IoT device on that container, we know where that container sits on a ship, whether it's sitting floating in the water, or it's sitting on a truck or train or sitting on the dock, and based on that additional information, we can take that insight, working with that client to those carriers, and understanding what that risk is and how it is that we help place that. That's just one element that we have with many clients. Obviously, with the right permissions and protections, that we're able to bring that insight overall. It all emulated, started with our ICT segment, and I would tell you, we don't believe any of our competitors have anything like it. Although we don't call it data analytics and have it as a separate segment and highlight it that way, it's very much a core to everything that we do.
I would tell you also in our CRB businesses, as much as important of all the decisions that we didn't put into it and why we didn't make those decisions, that helps our clients and our future clients because of the data that and the decisions that we made. Thank you for the question. Other questions?
I'm going to give you a lay-up question.
Okay.
It might not fit in. If you look at Marsh and you look at Aon, which are your two principal competitors, and if you look at their results over the last couple of years, they've announced these massive restructuring charges. They smooth everything out. What are speaking to is quality earnings. My view is if your quality earnings, because you have the gap between your reported earnings and your adjusted earnings is much narrower than some of your peers, and you're promising 50 to 70 basis points of margin improvement, are we going to see a restructuring program out of Willis Towers Watson diminish the quality of earnings?
Thank you, Greg. Back to question is, are we going to take a restructuring program? If you looked at our competitors, maybe they haven't looked at some of those things. If you looked at our gap between our adjusted numbers and our reported numbers, that has been narrowing overall. Should you expect any kind of restructuring actions out of Willis Towers Watson? Look, never say never. You know what I mean? I think that'd be inappropriate for me to say, "Look, we're not doing it." There's been a conscious decision around financial discipline that we've had in the company. I joined the company two and a half years ago, and not saying I was a savior, I was just part of a great management team. We really tried to stop what I call EBS, earnings before bad stuff.
We had way too many types of adjustments of that way that were put in there that we really wanted to make sure to reduce that gap between any adjustments, which right now is principally amortization and our reported earnings, for that very reason, to give our investors comfort of what it is that we are doing in the company and delivering against it. To restructure any professional services organization, those are the only way you do it is constantly thinking about those things. Right now, that's not been our mindset. Our mindset is about delivering against operations, being consistent about delivering organic revenue growth, margin improvement at the 50 to 70 basis points that I discussed, and delivering the bottom line as well as free cash flow. I would necessarily in that order. Right now, there's a lot of focus on free cash flow.
Thanks, Greg.
Time for one more question.
If you were to exclude the three items you called out in free cash flow from last year and this other information, specifically the ones that just keep happening at the end of the day. What segment do you have the most capacity to cover into the future?
The question was, what should we be thinking about if you exclude the three items that I mentioned on free cash flow, what should we think about free cash flow into the future? Which of the businesses really are driving that overall free cash flow? I would tell you that we're comfortable that starting with your second question, that all the businesses are there in terms of doing it. The BDA segment, as we continue to grow TRANZACT, we'll see more usage of cash than generating cash. I would say HCB, you'll see more generation of cash overall. We're not giving any further long-term guidance at this stage. Frankly, we want to make sure we deliver on fiscal year 2020, we'll reassess anything going forward from that. Thank you for the question.
All right.