NEW YORK--(BUSINESS WIRE)--Managing general agents (MGAs) and MGA platforms are setting the pace for growth in specialty insurance markets worldwide, attracting global talent, technology and capital, a new study from Lexicon Associates finds.
The MGA Revolution: How MGAs are reshaping the insurance value chain provides the first in-depth analysis of the global MGA market, mapping the convergence of technology, talent and capital that is driving the growth of both ambitious standalone MGAs and MGA platforms and incubators around the world.
“The MGA market is now a global laboratory for innovative capital structures, with platforms variously harnessing the support of reinsurance captives, rated and collateralized reinsurance companies, Lloyd’s syndicates, insurance companies, and reciprocal exchanges,” said study author William Pitt.
“MGAs are expanding coverage options for the most challenging risks, including natural perils exacerbated by climate change and cyber risks,” said Mr. Pitt. “The target addressable market for MGAs is huge, including most of the $115 billion excess & surplus market for hard-to-place insurance in the United States and comparable fast-growing specialty markets around the world.
“Within these markets, MGAs are at the forefront of the development of parametric coverages that promise a faster and more predictable claims response to a widening range of risks. In personal lines and small commercial lines, markets with historically low levels of insurance penetration, such as pet insurance, are also growing rapidly through the application and focus of MGAs.”
Lexicon’s study finds MGA platforms and incubators particularly well positioned for growth. “MGA platforms and incubators offer a broader spread of risk to capacity providers and greater confidence for talent in markets where joining an MGA has not historically been a natural career choice,” said Mr. Pitt.
About The MGA Revolution: How MGAs are reshaping the insurance value chain.
This study draws upon the Lexicon database of more than 2000 MGAs, MGUs and program managers and over 100 interviews with MGA founders and executives at program carriers, fronting companies, reinsurers, venture capital and private equity investors, technology and talent specialists. For more information, visit https://www.lexiconassociates.com/.
