After a January that felt more like several Januarys rolled together, yet at the same time seemed to speed by, our thoughts now turn to the rest of 2021 and how the coming months will shape the rest of the year.
We know challenges lie ahead, certainly for many brokers; obtaining the products they need for their customers will be much more challenging, with contraction of capacity, rising rates and the looming threat of a double dip recession.
Against this backdrop, I believe that now it is even more vital for us to explore new relationships as well as strengthen existing ones, and for MGAs to continue to demonstrate to brokers why they would make the perfect business partner to navigate a hard market.
This need for partnership will be our focus next month as the MGAA hosts it’s third “Meet the MGA Market” event on March 02. In previous years, we’ve enjoyed the chance to bring brokers and MGAs together in person to showcase the wide range of expertise and innovative solutions offered by the MGAA community. This year, as with almost everything these days, will be slightly different. And although the event will be held completely online our mission remains the same - to play matchmaker between entrepreneurial MGAs and brokers looking for new products and services.
I have always been an advocate of the MGA/broker relationship, but in the current market, I believe it is more important than ever to explore new avenues of working together to mutual benefit.
Our market is changing rapidly in response to the global pandemic, with pricing, quality of service and the ability to adapt products to meet customer needs being critical. The reality is that although insurers are excellent at what they do, agility and speed of response is often challenging. MGAs on the other hand, are by their very nature more fleet of foot and able to offer innovative solutions that support the changing needs of customers. This is one of several reasons many insurers support MGAs. This was evidenced last year as we saw many MGAs bringing in changes to products and optimising their service to provide online support, enabling brokers to support their customers in their time of greatest need.
Many MGAs serve niche markets covering a huge variety of standard and non-standard risks. As brokers know, it can often be difficult to place these risks directly as insurers deem the class outside of their risk appetite or, more often, they just do not have the right expertise in-house to underwrite such risks. That’s why MGAs, who have built up dedicated expertise in many of these classes of business have such a key role to play, particularly when risk appetite and acceptance criteria is being tightened. And it is not just knowledge, but access that can make the difference - as the relatively small size of the MGA compared to a traditional insurer means that direct access to a technical competent underwriter is quicker and more straightforward. Something that is essential when dealing with non-standard risks where time is of the essence, and the speed at which they can get through to these experts can mean the difference between winning or losing a piece of business.
I look forward to seeing many MGAs and brokers at our Meet the Market event, and, albeit it virtually, believe this coming together will further strengthen the already strong relationship and mutual recognition of value these communities represent.