Every broker placing business through a managing general agent is, whether they've clocked it or not, now standing inside the Financial Conduct Authority’s (FCA) line of sight.
The regulator's governance review of MGAs and coverholders, running since the second quarter of the year with findings due in early 2027, doesn't stop at the MGA's own front door. It reaches back along the distribution chain to anyone who placed business there, because Consumer Duty accountability for outcomes cannot be handed off along with the underwriting pen.
That's the detail that makes this year's developments worth a broker's attention, beyond the trade-body reporting that usually accompanies an annual report.
The Managing General Agents' Association (MGAA) has set out, in its Annual Report 2026, how closely it has been working with the FCA over the past twelve months, with Lisa Sturley, the regulator's Director of Insurance, and her team taking part in the Association's Compliance Insight webinars.
That engagement sits on top of a formal shift in the regulator's own remit. The FCA's Regulatory Priorities for Insurance 2026 report, published in February, extended oversight to delegated authority models, remuneration arrangements and the use of AI in underwriting and claims for the first time, and its Policy Statement PS26/6 is phasing in Senior Managers and Certification Regime reforms through the second half of the year, with conduct-related changes taking effect on September 1.
The regulatory bar for MGA governance has moved, and the firms that can't clear it are the ones a broker doesn't want to have committed business to.
Insurers cannot delegate away accountability for outcomes even where underwriting and claims sit with an MGA, and capacity providers are responding accordingly. Renewal terms are increasingly likely to demand audited claims-handling management information and evidenced customer outcomes as a standard condition of capacity, not simply good practice.
That has a direct read-through for anyone placing business with an MGA. A firm that loses capacity, or has terms tightened mid-cycle because it cannot produce the evidence an insurer now wants, creates disruption a broker has to manage on a client's behalf, often with little warning.
Consultancy Pro Global has described the shift as one where "operational governance is firmly in scope," with boards being pushed to test real-world outcomes rather than simply review process design, and to consider independent third-party review in higher-risk areas such as delegated claims handling.
None of this is theoretical. The FCA's Home and Travel insurance claims handling reviews earlier in the year prompted more than ten insurers to review their claims processes in the first quarter, and advisory firm Deloitte has noted that strengthening claims management information is now a top priority for insurers facing that scrutiny.
A House of Lords committee has since opened its own inquiry into how home and travel insurance is regulated, with claims handling a stated focus.
Separately, the FCA levied £124 million in fines across the financial sector in 2025, and its Enforcement Watch confirmed six active Consumer Duty investigations, two of the most serious involving home and travel insurers. The regulator imposed voluntary requirements on at least one firm, restricting its growth while governance weaknesses were addressed, following a formal super-complaint from consumer group Which?.
A broker relying on an MGA's paper is, in effect, relying on that MGA's ability to withstand exactly this kind of scrutiny without losing capacity or facing enforcement action that disrupts live business.
Artificial intelligence adds a further wrinkle worth flagging to anyone assessing an MGA's operational maturity. A white paper presented at the MGAA's Annual Conference this year, produced by cyber security and IT provider Intersys, found more than 80% of MGAs already use AI in some form, but only 52% have a formal governance framework in place to manage it, against 93% of Lloyd's managing agents surveyed separately.
An MGA using AI in underwriting or claims without a governance framework behind it sits squarely inside the FCA's stated priorities, and represents exactly the kind of gap a broker's own due diligence should now be probing.
Michael Keating, the MGAA's chief executive, said the Association had continued to play "a proactive role at the centre of the insurance market, engaging closely with regulators, policymakers and key trade associations."
None of this is slowing the market down. MGAs now account for more than 10% of the UK's £47 billion general insurance market, with upwards of 350 firms operating in the country, and Lloyd's-linked delegated authority business is forecast to pass 45% of all business written by 2027 — meaning brokers' exposure to this governance question will only grow.
The MGAA's own membership figures track that trajectory. MGA members rose from 249 to 270 over the year to July 2026, market practitioners from 68 to 76, and supplier members from 152 to 166, continuing growth recorded the previous year, when MGA membership rose from 233 to 249. Members also voted to open the Association to non-domiciled organisations, giving overseas firms a formal route to weigh up UK investment in the sector.
Tim Smyth took over as chairman following the Association's July conference, succeeding Charles Manchester after a decade in the role. Keating confirmed the MGAA will launch a membership research project once the current reporting period closes, intended to guide its priorities over the following two years.
"The importance of your engagement in this survey cannot be underestimated, and I trust I can rely on your support," he said.
