Hunter Nelson explains how insurers use programs to hand underwriting authority to managing general agents (MGAs), brokers, and wholesalers. An MGA gets the insurer's policy forms, makes underwriting decisions, and handles claims while the insurer provides backing. It's a structural shift in how insurance gets distributed.
Here's where things kind of drop off the line on insurance companies you might not want to work with as much anymore. So now we have what's called a program. A program is going to be the same process, what I just talked about. You're going to have an MGA, a middleman, whatever the case is. But instead of the insurance company really doing a lot of the underwriting, actually issuing the insurance policy, being the ones who are backing you guys up on this, now they give the authority to the broker, the MGA, the wholesaler, They got a million different names for them. Whatever the case is, typically is going to be an MGA, a managing general agent, not your typical insurance agent, or will be referred to as a retail agent. These MGAs will partner up, take the policy forms from an insurance company. The insurance company might use some data there, do some of the claims, whatever the case is.
