Strengthening the Broker-MGA Relationship in a Dynamic Market for UK SMEs

The backbone of distribution

Regional brokers remain the backbone of UK insurance distribution, serving local businesses with in-depth knowledge of client needs. For MGAs, these brokers offer vital market access, ensuring that specialist underwriting capabilities reach underserved segments. This partnership is mutually beneficial – brokers gain access to bespoke products that large insurers may not provide, while MGAs benefit from the brokers’ on-the-ground insight into customer risk profiles.

SMEs in particular rely on brokers who understand their industries and risks. MGAs can enhance this offering by developing innovative products that cater to niche business needs, ensuring that the right coverage is available where it is needed most. The ability of MGAs to design, price, and distribute specialist policies with agility makes them an essential part of the value chain, complementing brokers’ advisory roles.

Examples that highlight the evolving nature of broker-MGA relationships include the innovative work of companies like Aurora and blip. Aurora, a digital MGA, offers businesses tailored, easy-to-understand, and affordable insurance products in real-time. This is made possible through their proprietary algorithmic underwriting platform, which supports over 700 trade types. By utilising hundreds of data points, Aurora has revolutionised the insurance procurement process, enabling the instant purchase of complex policies. This innovation is further enhanced by their data-driven analytics, providing brokers with valuable insights to help clients make more informed decisions from a diverse and expanding portfolio of leading insurers.

Similarly, blip stands out as a digital-first insurance provider for small businesses. By offering competitively priced, clear, and accessible insurance products, blip enables members to not only save money but also share in profits and be part of a growth-focused business community. Their model highlights how MGAs can build strong relationships with brokers and clients, providing a comprehensive offering that aligns with the needs of small businesses.

At Pro MGA Global Solutions, we are also exploring similar partnerships to expand our offerings, collaborating with markets and businesses that unlock new growth opportunities while ensuring access to the right coverage for their unique needs. Our goal is to work closely with markets and brokers to develop propositions that help clients navigate an increasingly dynamic landscape – watch this space for further updates.

Regulation, Regulation, Regulation

The introduction of the FCA’s Consumer Duty has reinforced the need for MGAs and brokers to deliver fair value and ensure good outcomes for clients. This regulation places greater emphasis on providing relevant, affordable, and tailored insurance solutions, particularly for SMEs that may struggle to find suitable cover from traditional insurers.

By working closely with brokers, MGAs can develop policies that align with these principles – offering transparent pricing, clear policy wording, and flexible coverage options that truly support the UK’s SME sector. The challenge lies in balancing commercial sustainability with affordability, ensuring that businesses can access the protection they need without unnecessary complexity or cost.

The UK MGA sector is well positioned for growth, but its success depends on strong broker relationships. As supply chain pressures ease and economic stability is forecast, this alignment will be crucial in ensuring that brokers can offer tailored, competitive solutions in a rapidly evolving risk environment.

This piece was originally published in the May issue of The Broker, read it here