- 2,195
I do not understand the question, exactly
A wholesale broker typically markets insurance products to retail producers. There are a variety of reasons why, mostly so the insurer does not need to have a large sales force. The MGA assumes some of the responsibilities of the insurer, such as having authority to underwrite and bind business for the carrier.
- 2,195
OK, you use the word Brokers and MGAs either in a way that means they are the same group or different. So I asked for clarification if you are asking how an MGA that uses a Brokerage group interacts or...or if and when you use the term brokerage/broker you are referring to yourself. Sound like a confusing clarification - well welcome to the world of MGAs.
In short, its all over the place and the various MGAs all work differently. There is a ton of information on this forum for you to peruse and I would believe at least half of it.
Specific to your Application/Submission Question it really depends on the MGA. And it also is different between Commercial and Personal lines [sometimes] Many MGAS work almost exclusively on Acord and Sup Apps, while other allow you limited access to some insurers direct systems. But its way more complicated and nuanced than that.
Additionally many MGAs use brokerage houses to send harder to write stuff to. So in many instances you have 1.The Retail Agent 2.The MGA and 3. The Brokerage House - not to mention the insurer.
Having the authority to underwrite the product is what I would call more of an MGU, not an MGA and there are products out there where some Group has the limited ability to do this. The differenence between MGAs and MGUs is not at all clear to me.
In short, its all over the place and the various MGAs all work differently. There is a ton of information on this forum for you to peruse and I would believe at least half of it.
Specific to your Application/Submission Question it really depends on the MGA. And it also is different between Commercial and Personal lines [sometimes] Many MGAS work almost exclusively on Acord and Sup Apps, while other allow you limited access to some insurers direct systems. But its way more complicated and nuanced than that.
Additionally many MGAs use brokerage houses to send harder to write stuff to. So in many instances you have 1.The Retail Agent 2.The MGA and 3. The Brokerage House - not to mention the insurer.
Having the authority to underwrite the product is what I would call more of an MGU, not an MGA and there are products out there where some Group has the limited ability to do this. The differenence between MGAs and MGUs is not at all clear to me.
- Thread starter
- #5
Sorry for the delay and confusion!
My understanding of the MGA space in the US is as follows:
I was hoping to understand the interactions between steps 1 through 3. How does each party communicate with one another? Who gathers the information involving the risk? Who fills out the application?
Does that help?
My understanding of the MGA space in the US is as follows:
- Retail Agent sends over information to Wholesale Broker like RT Specialty
- The wholesale broker will send the information along to an MGA
- An MGA underwrites the policy and sends the quote to the broker/agent
- If the quote is accepted by the risk (insured), the policy is bound and the MGA is notified by the agent/broker
- Once the policy is bound, they send the information to the carrier
I was hoping to understand the interactions between steps 1 through 3. How does each party communicate with one another? Who gathers the information involving the risk? Who fills out the application?
Does that help?
As a retailer, you should think about it like any other deal
You need to gather applications, supplementals, and anything else that would be required for the submission. However, things to think MGAs typically have less flexibility as their program/pen was designed for a certain box of risks, and if you don't fit into it not really going to work. Anytime they need to try and get an exception they have to go to another carrier so things go a bit slower, and additionally, their paper isn't permanent.
You need to gather applications, supplementals, and anything else that would be required for the submission. However, things to think MGAs typically have less flexibility as their program/pen was designed for a certain box of risks, and if you don't fit into it not really going to work. Anytime they need to try and get an exception they have to go to another carrier so things go a bit slower, and additionally, their paper isn't permanent.
