2017: Property-Casualty Managing General Agents - Growth Continues, but No Escape from the Soft Market
The managing general agent (MGA) market continues to be one of the fastest growing segments. MGA-produced business accounts for a growing share of both commercial and personal lines premium spread over an increasingly large number of insurers. Insurers and reinsurers are attracted to MGAs, who can provide underwriting expertise and access to specialty business that may be difficult to reach. Using industry data from specialist insurers that do business with MGAs, as well as Conning’s proprietary survey results, this study analyzes the overall industry, the largest MGAs, and insurers in this market.
2. MGA Market—Year in Review
3. Growth/Size of the MGA Market
- MGA Market Premium Growth Rate Slows, Yet Still Outpaces Overall Property-Casualty Market Growth
- Drivers of Growth Remain
- Analysis of the MGA Market Using Statutory Data
4. Insurers’ Involvement in the MGA Market
- Largest Insurers in the MGA Market
- Insurers Using Nonaffiliated MGAs
- Insurers Using Affiliated MGAs
- Market Movement
- Lines of Business
- Mix of Premium by Affiliation Type
5. MGA Premium Trends
- Nonaffiliated MGAs
- Affiliated MGAs
- MGAs’ Breadth in the Market
- Authorities Granted to MGAs from Insurers
6. Conning’s MGA and Program Market Survey
- Detailed Survey Findings
7. M&A Activity in the MGA Market
- Distribution M&A Environment
8. Trends and Outlook for the MGA/Program Market
- Current Environment
A. Overview of the MGA Market
B. Largest MGAs
C. Selected MGA and Program Market Survey Respondent Profiles
This study on the MGA (managing general agency) market is Conning’s third update from our initial report published in April 2014. The report includes full-year 2016 results, creating a database of five years’ worth of data on the MGA market from which to analyze trends. Conning continued its in-depth analysis of statutory records to expand the database from prior years’ analyses. In doing so, we have added more MGAs and insurers. Our MGA database now has information on 640 active and unique MGAs and more than 200 insurers that currently use this important distribution channel. Our tracking database of MGAs has grown to almost 1,200 records that also include more than 300 MGAs that were not listed in 2016 filings, but had prior reported relationships with insurers.
Our analysis observed another year of above-market growth in 2016, yet reveals signs that this increasingly popular and resilient sector is not immune to the effects of the prolonged soft market.
This report combines data from NAIC-required filings on MGA/program business along with findings from Conning’s third annual proprietary market survey of MGA executives. Conning has expanded the reach of the survey and has grown the number of respondents by 37% over last year. Survey respondents represented a broad mix of some of the largest MGAs to the smaller, independently owned operations, capturing the spectrum of opinions and market conditions of the program sector.
In-depth interviews were conducted with 14 MGA executives to add perspective and color to the survey and help interpret our quantitative data results. A new addition to this year’s study includes the insurer perspective gleaned through in-depth discussions with insurance company executives who manage program business. Conning’s deeper conversations with MGA and insurer executives explored a broad range of topics from the current program environment, M&A activity, new program development, challenges facing the sector, to their outlook for program business.