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🏢 '''Managing general agent''' (MGA) is a specialized type of [[Definition:Insurance intermediary | insurance intermediary]] that has been granted [[Definition:Delegated authority | delegated authority]] by one or more [[Definition:Insurer | insurers]] or [[Definition:Reinsurer | reinsurers]] to perform functions that typically reside with the carrier itself — including [[Definition:Underwriting | underwriting]] risks, binding coverage, setting [[Definition:Premium | premium]] rates, appointing sub-agents, and in many cases managing [[Definition:Claims management | claims]]. Unlike a standard [[Definition:Insurance broker | broker]] or [[Definition:Insurance agent | agent]] who places business with a carrier for approval, an MGA operates with a degree of autonomy that makes it, in effect, the face of the insurer to the [[Definition:Policyholder | policyholder]] and distribution chain. The MGA model has deep roots in the U.S. surplus lines and specialty markets but has expanded significantly in the [[Definition:Lloyd's | Lloyd's]] market — where MGAs often operate as [[Definition:Coverholder | coverholders]] under binding authorities — and increasingly across Continental Europe, Asia, and other regions where carriers seek agile access to niche segments.

⚙️ An MGA typically operates under a contractual arrangement — often called a [[Definition:Binding authority | binding authority agreement]] or [[Definition:Delegated authority | delegated authority]] agreement — that specifies the classes of business the MGA can write, the geographic territories covered, premium volume limits, [[Definition:Risk appetite | risk appetite]] parameters, and the extent of claims-handling authority. Revenue for the MGA generally comes from [[Definition:Commission | commissions]] on premiums written, sometimes supplemented by profit-sharing arrangements tied to [[Definition:Loss ratio | loss ratio]] performance. The carrier provides the [[Definition:Insurance license | regulatory license]] and risk-bearing [[Definition:Capital | capital]], while the MGA contributes specialized [[Definition:Underwriting | underwriting]] expertise, distribution networks, and often proprietary technology platforms. This division of labor explains the model's appeal to both sides: carriers gain access to profitable niches — such as [[Definition:Cyber insurance | cyber]], [[Definition:Professional liability insurance | professional liability]], or parametric [[Definition:Catastrophe insurance | catastrophe]] products — without building in-house teams, while MGAs can build focused underwriting businesses without the capital and regulatory burden of becoming a licensed insurer.

📈 The MGA sector has experienced a surge of growth and investor interest, driven in part by the [[Definition:Insurtech | insurtech]] wave, which has produced a generation of technology-enabled MGAs leveraging [[Definition:Artificial intelligence | AI]], [[Definition:Big data | data analytics]], and digital distribution to compete effectively against traditional carriers and brokers. [[Definition:Private equity | Private equity]] firms and [[Definition:Venture capital | venture capital]] investors have been attracted by the asset-light, high-margin characteristics of the MGA model. However, the rapid expansion has also drawn heightened regulatory scrutiny. Supervisory authorities — including the [[Definition:Financial Conduct Authority | FCA]] in the UK, the [[Definition:National Association of Insurance Commissioners | NAIC]] in the U.S., and Lloyd's own oversight mechanisms — have tightened requirements around delegated authority governance, data reporting, and conduct standards, recognizing that poor MGA oversight can expose carriers to unexpected [[Definition:Loss | losses]] and policyholders to service failures. For the broader market, MGAs serve as an essential engine of innovation and specialization, channeling entrepreneurial energy into an industry where agility and deep domain expertise often deliver superior [[Definition:Underwriting | underwriting]] results.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Delegated authority]]
* [[Definition:Coverholder]]
* [[Definition:Binding authority]]
* [[Definition:Program business]]
* [[Definition:Insurance intermediary]]
* [[Definition:Insurtech]]
{{Div col end}}

Definition:Managing general agent - Revision history

PlumBot: Bot: Creating definition