The enduring appeal of MGA’s for Underwriting Leaders
The enduring appeal of MGAs for underwriting leaders
The rise and rise of MGAs has been a defining characteristic of the (re)insurance market over the past decade. Consultancy Insuramore estimates the sector wrote $200 billion globally in 2023 and generated year-on-year revenue growth of more than 20%, while Aon’s 2024 Market and Carrier Analysis found that MGAs have increased direct written premium by 229% over seven years.
Providing a low-cost expansion route and access to underwriting expertise in niche or emerging areas, they remain highly appealing to carriers, particularly in specialty insurance. The market cycle may now be turning but insurers’ need to pursue growth efficiently and gain a toehold in new markets by leveraging MGA expertise and technological know-how that will continue to support the sector. What’s more, strong demand for these companies from strategic buyers and financial investors alike underscores their bright prospects.
With this growth, we expect the pull factors for expert underwriters towards MGAs to increase. Here’s why these nimble, capital-light entities are an attractive prospect for underwriters whose style may have been cramped by large insurers.
1. Greater autonomy and decision making
Setting up an MGA provides a rewarding outlet for entrepreneurial ambition, allowing underwriters to leverage their expertise and experience the satisfaction of building a business. Underwriting leaders enjoy greater independence and the ability to make quicker decisions without the layers of corporate bureaucracy. This autonomy allows leaders to shape strategy and respond to market changes more effectively.
2. Pursuing a passion
Whether your expertise is in insuring renewable energy installations, cyber risk, or Native American reservations, joining an MGA may allow you to pursue a passion for a line of business that may be sidelined within a larger organisation, since MGAs often focus on new and/or specialist markets.
3. Alignment of rewards with performance
Underwriting leaders working within corporate insurance often question whether their rewards and interests align with their division’s success, especially when compared with broader company reward structures. Many feel that their individual contributions aren’t directly reflected in compensation. This misalignment often leads experienced leaders to consider the advantages of joining an MGA. These entities generally offer more direct financial incentives. With profit-sharing, equity stakes, and performance-based rewards, MGA leaders can directly benefit from the success they help create, making their efforts more personally rewarding.
4. Entrepreneurial ownership
Linked to the above, one of the most attractive aspects of MGAs is the opportunity for underwriting leaders to take ownership. Unlike at large corporations, MGAs offer leaders the chance to help shape the business’s future, as well as benefiting from their contribution financially. In the event of an eventual sale, underwriters also get to share the rewards.
5. Flexibility and innovation
MGAs tend to be nimbler and more adaptable than large corporations. Underwriting leaders at MGAs can introduce new products or strategies without the delays and bureaucracy found in corporate environments. This in turn can enhance service delivery and customer satisfaction.
6. Work-Life balance and culture
MGAs often offer a more flexible, collaborative environment with a strong focus on results. This leads to a better work-life balance and a more fulfilling company culture compared with established corporate settings.
Conclusion
The appeal of joining an MGA lies in the opportunity for more autonomy, financial rewards, ownership, and the ability to innovate. For underwriting leaders looking to align their ambition with tangible results, MGAs offer an exciting, entrepreneurial path. At 20Twenty Search, we partner with a select group of preferred MGA and MGU platforms across Europe, Bermuda, and the U.S. markets. We work closely with executives exploring the MGA journey, providing tailored advice on the range of opportunities available. Our goal is to align you with the right partner, ensuring a strategic fit that supports your vision and long-term success.
