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The Long Tail: The crucial role of Managing General Agents with Mike Keating, CEO of the MGAA
Sep 9, 2025
Mike Keating, CEO of the Managing General Agents' Association (MGAA), sits down with City AM’s managing editor Rupert Hargreaves to discuss the crucial role MGAs play in the insurance market.
Filmed in Lloyd’s of London, the beating heart of London’s insurance market, Mike discusses:
The role of MGAs in the insurance landscape
The benefits for consumers of using MGAs
How these providers are leveraging AI and analytics
And the outlook for the MGA sector, the fastest-growing segment in property and casualty insurance globally
The Long Tail is a compelling series of interviews conducted by City AM, featuring prominent figures in the City of London's insurance sector. Each discussion delves into critical aspects of the insurance market, exploring innovative trends, regulatory landscapes, and the evolving role of various players within this dynamic industry.
From the impact of emerging technologies like AI and analytics to the strategic importance of niche segments, "The Long Tail" provides an insightful look into the forces shaping the future of insurance.
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0:00
[Music]
0:07
Hello and welcome. I'm here today at
0:09
Lloyds right in the heart of the city of
0:11
London's insurance district with Mike
0:13
Keiting, the CEO of the managing general
0:15
agents association. Welcome Mike.
0:18
Great to be here. Thank you.
0:19
Just to begin, could you give us a an
0:21
overview of what a managing general
0:22
agent does?
0:23
Okay, a big big question, a very wide
0:25
question, but let me get try and get it
0:26
down. So effectively a managing general
0:28
agent first and foremost is someone who
0:30
actually has uh underwriting expertise
0:33
in its own chosen sector and that would
0:35
be quite a niche sector of insurance. It
0:38
could be two or three different sectors
0:40
but that's what it does. But what it
0:41
actually does and the unique nature of a
0:43
managing general agent is that it takes
0:45
capital from large insurers. So large
0:48
insurers deploy their capital to that
0:50
underwriting expertise and that MGA
0:53
underwrites on behalf of that insurer.
0:56
Now the advantages of that is that it
0:58
enables insurers to get access to
1:00
product lines and underwriting expertise
1:03
which they don't want to build
1:05
themselves but can see the opportunity
1:07
to get mutual profitability through. So
1:10
it's effectively someone using their
1:12
balance sheet to an MGA to underwrite on
1:15
their behalf.
1:15
So that ability to bring in different
1:17
skills is correct what their unique take
1:20
on the market.
1:20
That's right. So I suppose the way I
1:22
could frame it is that rather than build
1:24
that infrastructure and capability
1:26
yourself as an insurer, let's deploy our
1:29
balance sheet to experts already in that
1:32
field and let them do that for us.
1:34
So how does that affect me as the
1:36
consumer, the buyer of insurance? Well,
1:38
as MGAs by nature and the genesis MJ is
1:42
that they are specialist in their
1:43
underwriting expertise as a buyer of
1:46
insurance, you know, if you were in a
1:49
thatch property, if you're in a property
1:51
which was in a flood zone, if you had a
1:53
particularly wy car which requires
1:56
particular underwriting expertise to
1:58
give you the coverage you require, then
2:01
the likelihood is that an MGA would
2:03
actually be providing that that
2:05
capability. So for an example, if you
2:07
were driving a Ford Escort, Ford
2:10
Montdale, showing my age here, then you
2:13
would go to a number of uh well-known
2:15
insurers. If you were sort of driving a
2:18
sort of, you know, a wacky sort of type
2:20
car with all different things, an
2:21
insurer wouldn't naturally want to do
2:23
that, but an MGA would have specialist
2:25
underwriting expertise, specialist
2:28
product to meet your requirements as a
2:30
customer. So this is where MGA's really
2:32
form a large part of the insurance
2:34
ecosystem by actually meeting the needs
2:37
of sort of niche and specialist
2:39
insurance requirements.
2:41
How do the MGAs play a role in reducing
2:44
the protection gap across well the the
2:47
economy in general?
2:48
Well, they've always had an important
2:50
role
2:50
but that role if you look at the
2:52
buoyancy of the MGA sector both UK,
2:54
Ireland, Europe and internationally is
2:56
growing exponentially. Absolutely exp.
2:58
and what they do it comes back to their
3:00
key underwriting expertise. So where
3:03
that you have and quite like you know
3:04
some some excellent insurers who are
3:07
providing cover to 60 70% of their sort
3:11
of customer base what MGAs are doing and
3:14
continue to expand on is providing
3:16
coverage to areas which are require
3:18
underwriting expertise where there are
3:20
niche and specialists and if you look at
3:22
the market now if you look at cover such
3:24
as for cyber you know cyber is generally
3:27
sort of uh met by MGAs MGAs have deep
3:32
broad understanding of cyber uh
3:34
requirement parametrics is the is the
3:36
domain of MGAs you know new climate sort
3:40
of change uh environmental products
3:42
these will actually be provided by MGAs
3:44
and why do MGAs provide that one and I
3:47
I'll keep coming back to rather boring
3:49
because they have the underwriting
3:50
expertise and knowledge number one two
3:53
insurers don't feel that they want to
3:55
build that capability themselves and
3:57
three coming back to your original
3:59
question the MJS can provide the program
4:02
design at the right price cuz it's
4:04
absolutely right for for the end
4:06
customer. So that's where they're
4:08
closing their gap. They can also bring
4:10
products to market far quicker than
4:13
traditional insurers. No, they have that
4:15
innovation, agility, speed. They're not
4:18
caught in a what I call the sandwich of
4:20
legacy systems, right? So they've got
4:22
one system, one version of the truth. So
4:24
their speed to market to meet broker
4:27
customers requirements is uh unrivaled.
4:30
So you mentioned there cyber and then
4:32
the the sandwich of of
4:34
legacy system
4:35
legacy systems right how are MGA's
4:38
working with a AI and analytics to
4:40
improve the prove the coverage
4:42
well 40% if you look sort of globally
4:45
40% of MGAs will sort of say that
4:48
they've invested in AI okay so uh the
4:52
first point I would make is that you
4:53
know investment in AI has to be don't
4:56
write a check to actually fully
4:58
understand from a business perspective
5:00
that what you want that technology and
5:02
AI to do for your business. Uh there's
5:04
too many cases where people have already
5:07
written checks and then had to work out
5:08
what have we written this check for. So
5:10
I think that's that's quite an important
5:12
sort of council message if I may I may
5:14
give one. But what one example say so
5:16
some of our members are using AI where
5:18
they will triage presentations from
5:21
brokers uh that will triage and actually
5:24
the AI will actually uh basically ingest
5:26
that that inquiry but only present to
5:29
the underwriting community the
5:31
underwriting information required to
5:33
actually look at that particular risk
5:34
and and price it. So instead of the
5:36
underwriting community having to
5:39
effectively go through let's say a
5:40
30page presentation the AI will actually
5:43
sort of uh from an operational
5:45
perspective triage that and that that in
5:48
in some examples with members that's
5:50
increased underwriting productivity by
5:52
over 40%.
5:53
So so it it works for the works for the
5:55
customer to your point works for the
5:57
broker works for the MGI. So so that's
6:00
just a uh you know one one example where
6:03
AI has been particularly relevant.
6:05
Okay. Well, shifting gears slightly,
6:07
let's talk about demographic shifts and
6:09
how changing getting an older population
6:11
in the UK is affecting what's required
6:13
of insurers and MGAs. Um, what are you
6:16
seeing from your side?
6:17
I'd like to say I see an enhanced focus
6:19
around vulnerable customers if you if
6:21
you bit. I think the FCA to be fair has
6:23
always been very very sort of
6:25
forensically sort of focused to make
6:26
sure that vulnerable customers have the
6:28
right access and the right sort of uh
6:30
options to discuss their insurance
6:32
concerns. And I'd like to think the
6:34
industry is sort of very aware of that
6:36
and MGA's full part of that. They will
6:38
continue to do that. what you do see
6:40
from uh you know both insurers and MGAs
6:43
who focus on for one of a better phrase
6:46
the silver surfers if you want you know
6:48
they will provide you know more tailored
6:51
products for that particular buyer and
6:53
it comes back to the earlier point about
6:55
how is the market adjusting in terms of
6:57
to uh shifting consumer needs you know
7:00
digital non-digital whatever or a hybrid
7:02
of digital and and non non-digital and I
7:05
think you know I would say this but I
7:06
think the MGA community are particularly
7:08
adept with that innovation to meet those
7:10
sort of needs. But effectively, you
7:12
know, you've got as an aging population,
7:15
uh, you know, we touched briefly on
7:16
before we started talking around sort of
7:19
healthcare. But in the PNC space, then,
7:22
you know, affordability but with the
7:25
right cover is something I think the
7:27
insurance sector are quite focused on
7:28
for that aging aging sort of population.
7:31
So, we've talked about a lot of a lot of
7:33
different sectors, a lot of different
7:34
markets, lots of things going on in the
7:35
world of insurance over the past 10
7:37
minutes or so. what is the outlook for
7:39
the sector from your perspective over
7:41
the next couple of years.
7:42
Okay. So there's two things on this. So
7:44
so first of all I'll do the this is the
7:46
great news and then I and then I'll do
7:48
the cautionary stuff. So so the great
7:50
news is is that the MGA sector uh is the
7:53
fastest growing segment PNC both in the
7:55
UK uh Europe and internationally. You
7:58
know it has enormous amount of
8:00
investment going into it from PE firms.
8:03
There are more MGA starting up than
8:04
there are brokers. uh and this is
8:07
fantastic because it's delivering really
8:09
niche underwriting expertise for the
8:11
right for consumers. So that that the
8:13
buoyancy of the sector and the muscle
8:15
memory of the sector about the need to a
8:17
ensure it looks after its capital I the
8:19
insurer but b actually deliver uh
8:22
consistent underwriting profits I think
8:24
is very important.
8:25
The the sort of note of caution is that
8:28
over the next two years we're we are
8:30
certainly heading into a reducing rate
8:33
adequacy environment. So premiums are
8:36
going to come down. MGA business is a
8:38
margin business. So effectively MGA
8:41
margins may actually sort of slightly
8:43
drop or or or be flat. And of course if
8:46
the MGA's operational costs haven't got
8:50
the flexibility in them,
8:51
there's always the danger that MGOS's
8:54
will look to grow their business to meet
8:57
their fixed costs in a market which is
9:00
actually sort of against them. Yeah.
9:02
And when we've seen that before in
9:04
softening markets, for one of a better
9:06
phrase, some MJS have got in distress
9:08
because it hurts their capital. And if
9:10
it hurts their capital and therefore
9:12
you're not looking after your capital,
9:14
you won't have a business because you're
9:16
using third party capital to actually
9:17
run an MGA. So that's the note of
9:19
caution. I'm very very confident that
9:22
you know the MGA community UK, Ireland
9:25
and internationally and in Europe
9:27
importantly has got the tools and
9:30
ability to navigate this sort of next 24
9:33
months where there's a a rating in
9:35
adequacy challenge.
9:36
Okay. Well, that's great. That's a
9:37
positive note to end on. Thank you very
9:39
much for your time today. Okay. Thank
9:40
you very much indeed.
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