Once utilized to amplify the distribution channel or to serve as intermediaries between agents and insurance companies, managing general agencies today have new roles to play. In the “Age of InsurTech,” the digital MGA business model is anything but stagnant and is, in fact, fast evolving.
Executive SummaryThe MGA model offers a low-risk proving ground for InsurTechs and even for traditional insurers looking to expand product offerings and geographies. But MGAs aren't sure-fire successes. MGA-in-a-box solutions help, according to Xceedance's George Freimarck, who offers tips for selecting partners that deliver third-party platforms and managed services to support MGA models.
Launching as an MGA remains an attractive business model for entrepreneurs looking to enter the insurance market without the heavy lift in capital and organizational structure required for a traditional insurance company. MGA intermediaries can also be an attractive option for insurance companies looking to bolster new or specialized lines of business or an effective way to expand geographical reach. For other interested parties, an MGA launch may provide a short-term revenue strategy or a proving ground for testing InsurTech innovations in a live insurance environment.