MGA’s have evolved and here’s why…
Today’s Managing General Agents (MGA’s) are very different from the MGA’s of the past, playing a significant part in today’s insurance industry. As we prepare for another brilliant year of Broker Expo, we thought we would take a look at the evolution of an MGA, and how you as a broker can benefit from using one such as Gresham Underwriting.
What is an MGA?
An MGA is an underwriting agency vested with authority by an insurer, whose capacity it utilises, to write risks in agreed segments and areas. The MGA uses its agility and flexibility to provide distribution (always via brokers in the case of Gresham) in a speedy and effective manner – often far quicker than the carrier would itself be able to do.
At Gresham, we are an MGA dedicated to providing brokers with bespoke insurance solutions in the SME sector with a distribution channel ready for fast market penetration. So, why have MGA’s evolved?
MGAs in the past
Historically MGA’s haven’t always enjoyed the best of reputations – perceived by some as interested only in their own profits without due consideration for those of their insurers. Stacking high and selling cheap with little regard for underwriting discipline was a charge frequently levelled. Frequent changes of capacity provider and clients not always having the most appropriate covers were potential outcomes. But things are changing….
These days a number of MGA’s are trying to be far more discerning in their underwriting, employing people who can assist both with underwriting and analytical reviews of its book of business along with the data it produces. A quick profit is no longer the goal. Emphasis is on long term profitable growth with stable partnerships with insurers.
Why are MGAs different now to what they were?
Currently, MGA’s are one of the only growing sectors within the insurance market, accounting for somewhere in the region of £50billion of Gross Written Premium – approximately 10% of the UK commercial insurance market. But an MGA can only function with the support of its carriers. As Insurers continue to closely review their distribution channels so they become more discerning about delegation of authority and capacity with only those with prudent, robust and considered plans for long term profitability being entertained.
What does this mean for Gresham Underwriting?
Gresham Underwriting aims to be at the forefront of the new world of MGA’s – to be respected as a prudent underwriter and expert distributer. “We would love to be seen as a gold-plated MGA – one that can pride itself on its expert underwriting, its first-class service and offering to its brokers, its analytical approach to risk selection and pricing and its long terms profitability and partnerships.” says Robert Munden, Chief Underwriting Officer. “We are dedicated to building meaningful strategic relationships with our broker partners at the same time as partnering with like-minded insurance carriers – those looking for the same characteristics in partners as we ourselves look for here at Gresham – and who are committed to long term sustainable profit.”
At Gresham Underwriting, we have a multi-focused strategy:
- using more data and analytics to drive our underwriting
- employing data analysts, technical product managers and technical underwriters to enhance our underwriting offering
- building relationships with brokers – identifying their product needs and providing tailored solutions through rapid distribution methods
- providing a first-class service to all partners at all times
- continually engaging with our insurers to build partnerships and to create a ready pipeline of opportunities and products coming out to market to meet broker needs.
We are an underwriting agency who only use A-rated security, utilising our carriers’ capital as if it is our own. We wish to build strategic partnerships with our brokers and insurers alike to offer the best solutions for their needs as we aim to build long term profitable partnerships for all.
MGA’s, such as us at Gresham Underwriting, are turning the insurance industry on its head, providing bespoke, innovative, cost-effective solutions quickly and efficiently.
If you are an SME insurer or broker looking to work with us, please get in touch.
We are at stand 40 at Broker Expo and would welcome any enquires if you too are attending the event.