MGAs are a specialized type of agent who has been given underwriting authority to act on behalf of an insurer, the agent or broker is able to negotiate and set up programs on behalf of the insurer. The purpose of an MGA is to manage all parts of the insurance business and act as an agent for the insurer as well as a liaison between carriers and agents.
Why work with an MGA? The answer is simple, to better serve your clientele and find a solution that is both helpful and profitable. With an ever changing market and new technology it can be hard to find a plan that works for an individual business. By using an MGA you have someone who knows what you can offer and what the clients need. By coming up with a specialized plan instead of a one size fits all approach you are able to meet clients needs in a way other brokers are unable to, giving you an advantage in the market.
What does the current MGA Market look like?
Although there are more MGAs today than ever before there is still vast room in the market for new MGAs. An MGA helps with a certain problem and comes up with a custom plan to help insure not only proven industries but new industries such as technology. With new technological advances all over the world it has become increasingly hard to find a custom plan that would protect and insure new technology and data integrations in every industry from the food industry to the fashion industry. These new advances are hard to fit in an insurance box when they use new ideas and innovations, that is where MGA’s come in handy. By being the intermediary between the insurer and client they are able to create those specialized plans and programs to keep up with the innovation and find a perfect fit to make sure the insured and client are well taken care of.
The Benefits of MGAs
- Specialized programs: Another benefit to using an MGA is the specialization of programs. With everything from professional liability, workers compensation and surplus lines having expert knowledge from an MGA is helpful in working with your insurers and the clients to make sure the insurance needs are met with a specialty coverage program.
- Low risk: Using an MGA carries a much lower risk to the insurer. With new coverages and integrations it can be hard to expand into a specialty line of business. By using an MGA you receive the expertise needed to expand into a specialty line and further make your agency profitable without the risk.
- New markets: Finally insurers have the ability to enter into new markets easier than if they tried to enter on their own. Another new market an MGA can help offer is the ability to reach communities who are isolated compared to current clients. MGAs have more flexibility to work with clients in hard to reach regions giving you an entirely new pool of clients to insure.
The Superior Value of an MGA
Along with flexibility for specialty programs and helping you branch into new lines of specialty insurance the greatest value MGAs offer is the use of data integration specific to the insurance industry. With easier quoting processes and fingertip access to carriers as an agent, you have the ability to better support your client by having an integrated network at their fingertips. This saves your time and allows you to help your clients like never before.