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September 15, 2022


What: Investments into MGAs have accelerated over the past two years, driving up valuations and awareness of this area of the insurance industry. MGAs have quoting and binding authority within agreed-upon risk parameters, which gives carriers a way to expand into markets in which they’re not specialists without the need to develop an entire underwriting team. Because MGAs are typically specialized, they’re able to run more nimbly than traditional carriers, taking advantage of newer technologies and unencumbered by operation complexities inherent in most insurance carriers. 

Why it matters: MGAs are capitalizing on the “sunk cost fallacy” to which many carriers are victims.  These carriers are trapped by legacy technology decisions and “investments”, while MGAs can invest in modern technology at a fraction of the cost and provide a better experience for policyholders.  

Read: Insurance MGAs: Opportunities and considerations for investors | McKinsey


What: Cyber is one of the fastest growing coverages out there, but is difficult to price and service, making it ideal proving grounds for MGAs. San Francisco-based MGA Coalition is a leading cyber insurance provider in the US, and is using its success and expertise to expand into the UK insurance market. 

Why it matters: Ultimately, cyber is an international threat, especially for businesses that distribute internationally. Tools developed in the US can provide a playbook to other markets and may help US companies mitigate risk as more carriers and businesses invest in prevention. Ultimately, Cyber is a tech problem in need of a tech solution, which makes it perfect for specialization and MGAs; having a deep understanding of the problem means MGAs can better price and mitigate the risk.

Read: Cyber MGA Coalition Launches in UK Insurance Market


What: In 1997, the first cyber policy was written to address the speculative risk of internet fraud identified by financial regulators. Today, cyber coverage is one of the fastest growing sectors of the world’s insurance markets. 

Why it matters: What’s next for insurance? What new coverages need to be created with the birth of AI, and what can insurers do with new tech to revolutionize old coverages? Several weeks ago we covered cyber in some depth: Cyber Coverage as an Example of Product Innovation and Maturation.

Read: 25 Years: The Journey of Cyber Insurance

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