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                                                                    EXHIBIT 23.1
 
                        CONSENT OF INDEPENDENT AUDITORS
 
  We consent to the incorporation by reference in the Registration Statement
(Form S-8) and related Prospectuses pertaining to the 1988 Incentive Stock
Option Plan, 1988 Nonqualified Stock Option Plan, and 1989 Non-Employee
Directors' Stock Option Plan, of Arthur J. Gallagher & Co. of our reports dated
January 18, 1996 with respect to the consolidated financial statements of
Arthur J. Gallagher & Co. incorporated by reference in its Annual Report (Form
10-K) for the year ended December 31, 1995 and the related financial statement
schedule included therein, filed with the Securities and Exchange Commission.
 
                                          /s/ Ernst & Young LLP
                                          -------------------------------------
                                          Ernst & Young LLP
 
Chicago, Illinois
June 18, 1996
