Insuramore is reporting that MGA, MGU, and coverholder-group revenues jumped 21.7% in 2021.
The firm said in a statement that this figure is substantially ahead of the growth rate of world’s insurance broking sector which it said recently is believed to have increased in value by almost 12.5% in the same year.
The results come from a ranking and analysis completed by the company. It found that as Brown & Brown was ranked first globally in this arena in 2021 and has been building on that position during 2022 through the subsequent acquisitions of UK-based intermediary Global Risk Partners (GRP) and Orchid Underwriters.
In descending order, Insuramore reported that it is likely to have been followed from second to fifth by Gallagher, Ryan Specialty Group, Amwins, and Truist Insurance Holdings. By ownership, 59 of the top 300 groups in this space in 2021 were classified by Insuramore as broker-owned, 26 as owned by insurers and the remaining 215 as independent (albeit many of these are backed by private equity firms).
Among insurer-owned groups, Insuramore judged 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.
As would be expected given the very high industry-wide growth rate, almost all MGA groups experienced an increase in their revenues in 2021 and over 20 of the top 300 are believed likely by Insuramore to have more than doubled their income relative to 2020. While this growth has been caused in a few cases by M&A activity, Insuramore said 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 there are approximately 1,150 enterprises that are active in the MGA sector around the world and for most of them it is their exclusive focus of activity.
On one hand, their number is being boosted by new launches that aspire to join the cohort of fast-growing disruptors. On the other, there is some downward pressure on the number of groups because of consolidation among them.
Nevertheless, the MGA sector seems set to remain a hotbed of innovation with global revenues attributable to it likely to pass $20bn by 2023 signifying premiums intermediated by it worth more than $160bn by that year.
