By Gerard van Loon, CEO, Alta Signa
Managing General Agents (MGAs) are often portrayed as the future-forward backbone of insurance distribution, offering efficiency, innovation, and technical specialism. On paper, the model makes economic sense for capacity providers, brokers, and policyholders alike.
But in Europe, the reality is more complex, as I recently outlined in an editorial for The Insurer (Reuters). Market behaviour doesn’t always follow logic. Structural resistance, competitive tensions, and legacy preferences often hold MGAs back from scaling, despite their proven value.
Why MGAs should work:
- Convert fixed underwriting costs into variable, performance-based expenses
- Offer insurers low-risk expansion into new markets or specialist lines
- Provide brokers and clients with faster service, niche products, and local insight
- Allow insurers to allocate more capital to actual risk-taking, not infrastructure
Why the market resists:
- Local insurers may view MGAs as rivals, not partners
- Large brokers often protect their own delegated authority models
- Softer markets reduce urgency to seek alternative capacity providers
The path to scale:
- Articulate a unique and compelling value proposition - faster, smarter, more competitive
- Demonstrate staying power to address concerns around MGA longevity
- Secure long-term backing from aligned capital partners (e.g. family offices, reinsurers)
- Deliver operational excellence and consistency in execution
MGAs have the potential to move from the periphery to the core of European insurance distribution, but only if they can prove their value beyond theory.
To thrive at scale, MGAs must be more than efficient. They must be credible, committed, and aligned with the long-term needs of both brokers and capacity providers. No silver bullets - just clear focus, lasting partnerships, and genuine market relevance.
Further reading: Scaling MGAs in Europe: Between Theory and Market Reality