In insurance, the terms MGA and carrier are often used together, but they play different roles.
Both can be important in helping brokers and clients access insurance solutions, particularly when a risk requires specialized expertise. Understanding how they work together can make it easier to navigate the insurance marketplace and know who is responsible for what throughout the insurance process.
What Is an MGA?
A Managing General Agent (MGA) is an insurance organization that has been granted certain authority by an insurance carrier.
The specific responsibilities of an MGA depend on its agreement with the carrier. An MGA may have authority to:
- Review submissions
- Underwrite risks
- Quote and bind coverage
- Issue policies
- Provide policy administration
- Support claims and risk management services
MGAs often develop expertise within particular industries, products, or types of risk. For brokers, that specialization can provide access to underwriters who understand the nuances of an exposure and can help identify solutions designed around the client’s needs.
What Is an Insurance Carrier?
An insurance carrier is the company that assumes the financial risk associated with an insurance policy.
The carrier provides the capacity supporting the policy and is ultimately responsible for covered claims in accordance with the policy’s terms, conditions, limits, and exclusions.
Carriers may work directly with brokers or partner with MGAs that have specialized underwriting capabilities and delegated authority for particular products, industries, or markets.
MGA vs. Carrier: What’s the Difference?
While the exact relationship can vary, an easy way to understand the distinction is:
MGA
- Operates under authority granted by an insurance carrier
- May underwrite, quote, bind, and administer coverage
- Often develops specialized expertise in particular risks or industries
- Provides underwriting and service capabilities
Insurance Carrier
- Assumes the financial risk behind the insurance policy
- Provides insurance capacity
- Establishes the authority delegated to an MGA
- Is responsible for covered claims according to the terms of the policy
In simple terms, the carrier provides the capacity behind the policy, while the MGA may provide the specialized underwriting expertise and service that bring the insurance solution to market.
Is an MGA the Same as a Broker?
No. Although MGAs and brokers work closely together, they generally represent different sides of the insurance transaction.
A broker represents the client and helps identify insurance solutions based on the client’s needs.
An MGA generally operates under authority granted by one or more insurance carriers and may have the ability to underwrite and bind coverage on their behalf.
For a broker, that means an MGA can serve as a direct connection to specialized underwriting expertise and insurance capacity.
Why Does the Relationship Matter?
Complex risks don’t always fit neatly within traditional insurance solutions.
That’s where the relationship between carriers, MGAs, and brokers can be particularly valuable.
The carrier provides financial capacity. The MGA brings delegated authority and specialized underwriting expertise. The broker brings an understanding of the client’s business and insurance needs.
When those roles work together effectively, brokers can access specialized expertise and solutions designed around the risks their clients actually face.
Where Does Falvey Fit?
Falvey works with insurance carriers to bring specialized insurance solutions to brokers across Cargo & Stock Throughput, Inland Marine, Transportation & Logistics, Vessel Pollution, Specialty Marine, and other complex risks.
Our role goes beyond access to coverage. Falvey brings together specialized underwriting, in-house claims, and practical risk management expertise to support brokers throughout the relationship.
Not sure which solution fits your client’s risk? Start with the exposure. We’ll help you explore the options.
