For the past six years, most MGAs have operated in a hard market where submissions were plentiful and marketing was optional. But whether you realize it or not, that’s beginning to shift.
The majority of reinsurance treaties renewed on January 1st and brought lower reinsurance costs to primary insurers which will eventually reduce the rate charged to insureds. Better pricing will still be given to better performing clients and very soon, capacity will increase in most lines. Competition is also increasing. And agents who had limited options last year, may be overwhelmed with markets in the near future.
I realize that some industries remain hard while others are definitely soft, but the transition has begun and impact will be felt going forward. Here’s a brief article from Risk & Insurance’s review of CIAB 4Q2025 results to provide the large broker perspective.
We are in the early stage of the soft market
Most soft markets last approximately 8-10 years though many analysts believe that the swings of the past are gone due to A.I. modeling and adjustments. That is for a future newsletter as my point is that you need to focus on the next 10 years. The good news here is that at this stage of a soft market, agents prefer to renew accounts with the incumbent market who was there for them during the hard market. But pricing pressures will eventually ensue.
What This Means for MGAs
In a hard market, MGAs succeed by:
- Premium retention
- Maintaining some level of new business capacity
- Responding quickly to brokers with a Yes/No
- Disciplined technical underwriting
In a soft market, MGAs succeed by:
- Client retention
- Being visible to the right agents
- Responding quickly with an indication
- Clearly communicating their appetite
- Disciplined production underwriting
Consider market conditions like waiting for a train. In a hard market, submissions (or trains) come more often and underwriters can be more selective. But in a soft market, when underwriters are waiting hours for their train, they may be more apt to jump on the first available train (or submission) even if not ideal. You still want to underwrite the business properly, but you may find that you need to drop your price to entice your client to renew.
Your Visibility Problem
One of the biggest challenges we see with specialty underwriters is that agents don’t know you exist.
This was the longest hard market that I am aware of and it changed the intermediary marketplace. Wholesale and E&S programs grew by double-digits these past 6 years because admitted property markets vanished, followed by Excess/Umbrellas. Brokers were happy to find a market – any market – and wholesalers had a windfall. On the other hand, historically strong industry programs whose capacity dropped, or changed carriers or were forced to narrow their offering to remain competitive, may struggle a few years to regain their footing and edge because:
- They have been out-of-sight/out-of-mind for several years
- Their website lacks generative search to be found nowadays
- They lack consistent outreach to agents & brokers
- insureds are now looking to save on premium versus regain lost coverage
In a soft market, having capacity is no longer enough. You must be “findable”.
How’s Your Website
I wrote last year that you needed to address your website before the market turned. In reality, you probably have a few months to still do this, but eventually you will want your marketing dollars to go toward media exposure versus website expense. Vertibrands manages 50+ insurance intermediary sites and could help with that, but I digress.
Your website remains your most important distribution hub of your target classes, your appetite, your contacts, your content, your apps, your resources, and the reasons why brokers should work with you now.
At a minimum, your website should:
- Clearly define target classes of business
- Make it easy for agents to understand submission requirements
- Be optimized for generative, geographic and industry-specific searches
We’re seeing more agents search:
- “workers comp for tree service NY”
- “habitational MGA Texas”
- “liquor liability markets Florida”
If your site is not optimized for geographic or AI searches, consider yourself invisible.
The Digital Edge: Search Retargeting
Due to A.I., approximately 40% (and growing) of all searches result in no site visits. None. Nada. Ziltch. This is called “zero-click” search as no website gets the benefit of the agent or insured’s interest. I’m sure you are guilty of this yourself. We all are. But one of the most effective tools to counter this is Search Retargeting.
Search Retargeting allows MGAs to:
- Identify agents and insureds actively searching for specific industries or coverages
- Serve targeted ads to those agents AFTER they search
- Retarget these agents/insureds after they click your ad or visit your website.
- Stay visible during the decision process
In other words:
You’re not guessing who to market to. Your ads are targeting agents already looking for your product or program.
Introducing AI Into Business Development
Vertibrands has begun to see the impact of AI on MGAs.
Over the past several months, we developed an agentic, AI-powered sales assistant designed specifically to build sales pipelines for MGA new business teams.
It can:
- Research potential insureds
- Identify agents writing your target classes
- Research the broker’s business
- Initiate outreach
- Prepare intelligence prior to meetings or calls
- Provide daily reports of actions to be taken
Think of it as a business development rep that works 24/7 but only communicates with prospects during normal business hours.
If you attended the Target Markets conference in Dallas, you likely saw our MGA Producer. If you would like a demo, schedule a Zoom meeting.
So What’s Next
The MGAs who will win over the next several years are not necessarily the ones with the best pricing or underwriting. They are the ones who:
- build visibility early
- invest in distribution
- adopt smarter tools to reach agents
And as a marketer, a single-minded, benefit-oriented insured brand will only help cut through the clutter for insureds seeking an industry insurance expert. The market is shifting. How will your approach shift with it.
If you’d like to compare notes on what we’re seeing across the MGA market, feel free to email me or schedule a Zoom call here: https://www.calendly.com/rlook
