FAQ

MANAGING GENERAL AGENTs (MGA)

WHAT IS A MANAGING GENERAL AGENCY (MGA)?

A Managing General Agency is an individual or business entity acting on behalf of a capital provider to provide, negotiate, and countersign insurance contracts. This is most common when capital providers from Lloyd’s of London partner with Managing General Agencies in foreign jurisdictions to provide local expertise and relationships.

WHAT IS Lloyd’s of london?

Lloyd’s of London is not an insurance company. Lloyd’s is a London UK based marketplace where insurance buyers and sellers come together. The insurance sellers (or syndicates) are specialized in different types of risks and each seller decides which type of risk to insure. The main purpose of Lloyd’s is to act as an intermediary between clients, underwriters, brokers and insurance companies. Lloyd's currently enjoys an A+ rating from Standard & Poor's, AA- from Fitch and A from A.M. Best. These ratings are independent opinions of Lloyd’s financial strength and ability to meet its ongoing insurance policy and contract obligations.

WHy USE A Managing general agency (MGA)?

Insurance brokers will typically use a Managing General Agency to obtain access to specific products or expertise. Think of an insurance broker as the general contractor for an insurance policy - would you expect the contractor to be an expert in framing, plumbing, electrical, roofing, etc? Similarly, the insurance broker is the general contractor of the insurance purchasing process and may engage subject matter experts to ensure adequate coverage.

Does using a Managing General Agency (MGA) cost me More?

In most insurance transactions, the commission you pay (to insurance brokers and agents) is included in the total amount of your premium. Managing General Agencies are specialists within their area of expertise and have unique relationships with insurers who also focus on those areas. This expertise and relationships may actually lead you to pay less premium than when insuring with a standard insurance market.

Any other questions?

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