KEY TAKEAWAY
--A third of MGAs are planning to add insurtech partners over the next three years, and 40% expect to expand/grow their current partners in the space, such as distribution platforms or digital agencies. Affinity relationships and partnerships with other MGAs/MGUs are also likely to develop significantly among more than half of MGAs.
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There is no arguing about the strength of the managing general agent (MGA) market in 2023. MGAs’ agility, innovation and focus on specialty and complex lines have positioned them for continuous growth. Conning reported the MGA market grew by 24% in 2022, with associated premium volumes estimated to be more than $85 billion.
Much of MGAs’ success can be attributed to how versatile they can be. Incumbent MGAs are leveraging advanced tech capabilities and new channel strategies to propel their growth in a market with increasing competition. The latter has become especially critical as MGAs have a broader role in the distribution landscape and seek to expand their reach in an increasingly hardening market.
A new ReSource Pro research report examines the channel distribution plans of MGAs in 2023, including their current partnerships, their expectations about how distribution will change in the next few years and their strategies to expand various channel partners. Considering the many challenges in the market today, such as rapid technological advancements, evolving customer expectations and a volatile economic environment, MGAs are exploring aggressive plans to grow certain distribution channels.
While MGAs continue to expand and add foundational channels, such as wholesalers and retail agents/brokers, there is an interesting shift in their approach to insurtech. A third of MGAs are planning to add insurtech partners over the next three years, and 40% expect to expand/grow their current partners in the space, such as distribution platforms or digital agencies. Affinity relationships and partnerships with other MGAs/MGUs are also likely to develop significantly among more than half of MGAs.
Regardless of the channel partner an MGA chooses, conducting thorough due diligence and ensuring strategic priorities align across parties is essential. Identifying partners that strengthen market position will be key to MGAs’ long-term success.
