Working with a managing general agent, or workers comp MGA, provides value to both the insurance provider and the insured business. An MGA frequently performs many of the following functions on behalf of the insurance company:
- Binding coverage
- Pricing policies
- Appointing retail agents
- Settling claims
Why Insurance Providers Work With MGA’s
Insurance companies looking to expand their coverage into niche industries that require specialized expertise often work with MGA’s when they do not have staff with in-depth knowledge about the industry. The MGA can leverage their knowledge to help the insurer manage risk while expanding into new tradelines. In smaller geographic areas where it may not make economic sense for larger insurers to open branch offices, MGA’s may give them access to new markets at a fraction of the cost.
Why Insured Companies Work With MGA’s?
Companies with unique insurance needs may work through an MGA to find additional insurance options with more competitive pricing and terms. The MGA can be tasked with helping the insurer understand the risks associated with the industry to become more comfortable with doing business in that sector. A workers comp MGA may also have the opportunity to work more closely with the insured company when incidents occur to save money and time for all of the parties and help employees return to work as quickly as possible.