Blog: Are MGAs best placed to build the future of underwriting?

Businesses today are being built with a ‘digital-first’ mindset, leveraging technologies like artificial intelligence, cloud computing and application programme interfaces to put efficiency and customer experience at the forefront of their operating model.

New-world managing general agents like C-Quence are creating a radically different type of insurance company, using technology and data from day one to build automated and highly efficient processes, better customer experiences, and a more complete view of risks.

Free from outdated technologies and ways of thinking, MGAs are well placed to invent a better future for insurance. They are redesigning business processes to be maximally efficient, cost-effective, and customer-centric.

A unique set of challenges 

While MGAs are in a unique position to innovate, they also face a unique set of challenges. When starting out, most MGAs often don’t have a lot of resources to invest, which makes building highly efficient processes a major priority - they need to do more with less. 

MGAs need to turn around risks quickly or lose business to more nimble, better known competitors. In practice this means underwriters need accurate, comprehensive information at their fingertips to ensure a fast, efficient turnaround with quote to bind in minutes.  

For many MGAs, incomplete submission data means that underwriting often takes longer than it should, and valuable time is wasted manually gathering the information needed to assess a risk. In the long term, poor underwriting data is threatening the profitability of portfolios. That’s why MGAs are looking for new ways of doing things, differentiating their offering through technology in an otherwise crowded market. 

Reducing cost and complexity 

New-world MGAs are using technology and data to remove unnecessary cost and complexity, enhance customer experiences, and leverage a competitive advantage. 

Using APIs powered by external data, MGAs can underwrite business faster without increasing headcount. Data collection and verification can be automated, and underwriters have instant access to reliable information, reducing the time it takes to process a submission. This enables individual underwriters to process higher volumes of business.

Brokers and customers also benefit from a faster turnaround, and more accurate pricing. This helps to build good relationships with broker partners and differentiate the brand.

In practical terms, it doesn’t take long for MGAs to start leveraging a competitive data advantage. New technologies can plug into existing applications, underwriting systems, or broker extranets, so teams can continue to use familiar systems but with much better quality data and up-to-date risk information.

Flexibility in cost is important too. Just as the cloud has helped banks move away from expensive legacy systems that hold back innovation, plugging into external data sources (usually via an API) means cost can scale to usage in underwriting. This ‘pay as you go’ approach means that MGAs are not prohibited by cost, they can scale as required and innovate cost effectively.

The future of innovation

Unencumbered by legacy technology, MGAs are well placed to invent a better future for insurance. Getting the right tech infrastructure in place and having access to quality data will be instrumental to their success. 

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