Global MGA revenues to top $20bn by 2023; profits double at top 20

The global MGA revenues are on track to exceed $20 billion by 2023 from premiums intermediated of more than $160 billion, as the sector becomes a “hotbed of innovation” with new launches and rapid growth.

In 2021, the value of the worldwide market for MGA, MGU and cover-holder groups (delegated underwriting authority groups) grew by almost 22% to around $15.23 billion, before adjusting for inflation, according to a new report by Insuramore. This growth was “substantially ahead” of the growth rate of the world's insurance broking sector, which advanced in value by almost 12.5% in 2021.

The report found that Brown & Brown was ranked first globally in this arena in 2021, followed by Gallagher, Ryan Specialty Group, Amwins and Truist Insurance Holdings. Brown & Brown has been building on that position during 2022 through the subsequent acquisitions of UK-based intermediary Global Risk Partners (GRP) and Orchid Underwriters.

59 of the top 300 groups in this space in 2021 are classifiable as broker-owned, 26 as insurer-owned and the remaining 215 as independent (albeit many of these are backed by private equity firms). Among insurer-owned groups, Insuramore believes that Munich Re generated the highest revenues from proprietary MGA business in 2021 while Hagerty was the largest independent group.

Furthermore, by location of headquarters, and with 165 in total, the US played host to the most MGA groups in the top 300 with the UK (54), the Netherlands (12), South Africa (11) and Germany (11) coming next on this count.

Nearly all MGA groups experienced an increase in their revenues in 2021 and over 20 of the top 300 likely more than doubled their income relative to 2020. While this growth has been caused in a few cases by M&A activity, most MGA groups with triple-digit annual growth have achieved this through applying innovative technology to come up with genuinely new and disruptive offers in specific insurance categories, Insuramore said.

Insuramore believes there are approximately 1,150 enterprises that are active in the MGA space and for most of them it is their exclusive focus of activity. Their number is being boosted by new launches as well as “some downward pressure” on the number of groups due to consolidation.

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