Biba 2025: The real challenge with MGAs is building longevity to 'reduce volatility'– Lockton’s Clarissa Franks

MGAs’ value to brokers will be volatile unless these businesses can prove their sustainability, warned Clarissa Franks, head of UK property and casualty retail at broker Lockton.

Speaking during a panel discussion at this year’s Biba Conference (14 and 15 May 2025), entitled ’A new era for insurance broking’, Franks explained that MGAs are “going nowhere” and ”becoming more and more relevant” – but only if they are underpinned by sustainable capacity.

Franks said: “Part of our job is knowing the decision-makers, so you can get things done for clients. An MGA model – depending on how it works and where it’s set up – can mean you’re not actually speaking to the ultimate decision-makers in terms of the capital provider.

“If you’ve got an MGA that has that deep specialism and really great credentials [and] you are developing a client outcome [with the MGA], they need to review [this with their capacity provider], so [there is a] six-month lag [that] is the problem. You’ve created a great solution for the client, but then it goes away. That’s deeply problematic.”

Franks added that long-term confidence in an MGA relationship is essential to ensure that products are not just placed once, but renewed each year. This “ultimately makes things easier for everyone involved, enabling clients to plan ahead, maintain flexibility and reduce volatility.”

 ‘A bad MGA’

Biba’s panellists agreed that MGAs have a major role to play within UK general insurance as innovation hubs – especially with the market entering a new cycle of capital availability.

An interactive live poll during the conference session revealed that 80% of broker attendees used MGAs to place clients’ risks.

Fellow panellist John Warburton, chief executive at Konsileo, explained that “a bad MGA” could accelerate soft cycle conditions and undermine long-term sustainability.

He told delegates: “A bad MGA is basically shifting accountability for underwriting results by a time period because we’re entering potentially a softening market cycle. If you’re an underwriter, you’re being monitored on your rate strength month by month and you’re monitoring the loss ratio month by month.

“If you’re an MGA, you’ve got a lag in your own data. The people who come from the capital provider to talk to you are doing it on a periodic basis, they’ve got a lag on their reporting.

“So, you’ve built another six months right into the cycle where we can all fill our boots with that MGA while their pricing is off. The sustainability of that is obviously less good.”