Briefing: Soft market supports succession of MGAs and protects against ‘day of reckoning’

The MGA market means business.

According to 2024 figures published by trade body the Managing General Agents’ Association (MGAA), there are over 300 UK-based MGAs in operation in the general insurance industry. These firms underwrite roughly 10% of the £47bn total premiums collected by this marketplace.

These numbers are certainly not insignificant – but some sector commentators believe that cyclical market conditions may have given MGAs a competitive leg up and helped protect these businesses from a predicted “day of reckoning”.

For example, Nick Pomeroy – head of reinsurance and broking at QRG Specialty – observed that “the MGA model is usually at its best working in a soft market”.

His colleague John Harris, QRG Specialty’s chief business development officer, expanded on why this is in a conversation with Insurance Times at the end of 2025. “What will protect some MGAs is their ability to be truly niche,” he said.

“If you’ve got a truly niche [MGA] that has unique distribution and specialism, they’ll probably survive [amid] vanilla products and [market cycles].”

Broadly speaking, soft market cycles can fill primary insurers with trepidation as the supply and demand see-saw once again recalibrates so that brokers can more easily source competitive and generous cover options for clients.

These conditions can mean can differentiators between insurer offerings are wafer thin, with factors such as service and various add-ons or proposition enhancements becoming of more importance to attract and retain custom.

From this lens, QRG Specialty’s take does make logical sense – if numerous insurers operating in the same lines of business are offering very similar products at very similar price points, then brokers may indeed approach the MGA market for something more tailored or unique, if needed by their clients.

Matt Scott, co-founder at Insurance DataLab, agreed that Pomeroy and Harris had made a valid point. He said: ”Soft market conditions demand a more nimble, fast moving and proactive approach to doing business. As pricing softens and competition intensifies, the ability to respond quickly while maintaining underwriting discipline becomes increasingly important.

”MGAs are often well suited to these conditions. Their specialist focus allows them to move faster than many traditional insurers, while their leaner operating models mean they can also compete effectively on the expense base.

”MGAs also commonly operate within niche lines that are typically less exposed to the sharp price reductions seen in more commoditised classes. This can help reduce pressure on the combined operating ratio and, in some cases, lead to outperformance relative to the wider market.”

Big plans ahead?

Tim Quayle, chief executive at OneAdvent, concurred that MGAs have been making “bigger plans” over the last 18 months versus two to three years ago. This timeline roughly aligns with the onset of the latest soft market cycle.

Looking at dates, Paul De’Ath, head of market intelligence at consultancy Oxbow Partners, suggested that rates tentatively started softening in late 2023, with more noticeable and consistent rate changes starting “in earnest in the second half of 2024”.

For Quayle, MGAs of yesteryear were “small, single class” businesses. But, in line with the advent of the most recent soft market cycle, MGAs nowadays are “better funded” with “bigger plans”.

Furthermore, Quayle noted that he is “seeing a lot more alternative capacity structures sitting behind MGAs”, with Lloyd’s led single binders dropping off and being replaced by more reinsurance backing.

“It’s bigger plans, more ambition and slightly different capacity stacks,” he explained.

Soft market survival

Although cognisant of this “genesis” of today’s MGA market and acknowledging that there has been “a major proliferation of MGAs over the last few years”, Pomeroy is equally confident that “a day of reckoning” is on the horizon for this marketplace.

“There’s a hell of a lot of MGAs and they are not [all] going to survive. There is going to be a day of reckoning,” he told Insurance Times.

For him, the drivers of such market shrinking could be where MGAs “haven’t gained enough traction on premium”, had unfavourable results, or the insurance market hardens.

Pomeroy’s view does appear to be in the minority, however, with a volume of UK general insurance commentators instead insisting that “the rise of MGAs” is ongoing – as PWC’s Lloyd’s and London market leader, Andy Moore, told Insurance Times last September.

For him, the “highest deal flow” and transactions that he had seen in the market concerned MGAs or businesses involved in the American insurance sector, which does signpost a certain degree of attractiveness and interest.

Whichever way you look at it, the buzz around the MGA market is not dying down. And, as the soft market cycle continues, these businesses could indeed tap up growth opportunities by showcasing their niches and differences in comparison to insurer peers.

Insurance Times will be digging further into MGA market trends and performance during a webinar on 10 February 2026 – register here to attend and find out more about the session’s panellists.