23 October 2025

A record attendance at this year's Target Markets Program Administrators Association conference once again highlighted how the programs and MGA sector is in the midst of a golden age.

The Westin Kierland in Scottsdale was packed with executives from across the programs and MGA market, with seating space at a premium and closely guarded once secured.

Often, when an event gets to a certain size, service providers' interest soars and attendees from such companies become a greater proportion of the delegates.

Sure, there were plenty of vendors in the marketplace offering various technology platforms, many of which were artificial intelligence related, but one notable standout among the attendee list was the sheer number of carriers represented at the conference.

Market contacts said representatives from over 100 insurers and reinsurers were on the ground at the event, highlighting the significant continued interest from capacity providers in the programs and MGA space.

With plenty of capital entering the P&C industry broadly, it is looking to go to work, and evidently the programs and MGA market is one that is drawing plenty of attention.

PROPERTY INTEREST CONTINUES

Even with pricing in the property market reducing by double digits, there is seemingly no letup in interest in the sector from new MGAs. Reinsurance brokers and capacity providers that Program Manager spoke to during the event talked of multiple property-focused programs out in the market trying to source support to begin underwriting.

Plenty of skepticism was expressed that those startups will all get the capacity they need to begin operations. But those that do will be entering a market where they will likely only be adding to the problem of capacity oversupply in the property sector, and the onus will be on them to truly provide something different to what is already on offer.

NO SLOWDOWN IN STARTUPS

It is not just property startups coming to market however, with a host of specialty lines-focused operations also at the Westin Kierland meeting with brokers and potential capacity providers as they try to get their businesses off the ground.

Market sources said getting independent de novo operations launched remains challenging, with carriers uncertain about entities with no loss record, even if they are being led by long-tenured market specialists.

It is potentially a little easier if an exec leaves a balance sheet carrier and brings with him his former book (and which therefore does have some loss history) but contacts said that is still no guarantee that capacity will be secured.

What does make it easier for de novo operations to launch is if they are brought to market in tandem with one of the many MGA platforms that now operate in the market. Such platforms provide the back-office support that means the underwriters who have formed the startup MGA can focus on what they are good at - underwriting.

As sources noted, by partnering with an MGA platform, such startups have already been vetted to some degree, purely by being accepted into the group.

And if that platform has strong ties to various capacity providers that support other MGAs under its umbrella, then in those instances it may be easier to get capacity but is still far from certain.

M&A RUMORS ABOUND

There was also plenty of talk of possible deals within the programs and MGA market. With organic growth increasingly hard to come by as property starts to soften and competition in casualty intensifies, companies could turn to inorganic means to support their expansion.

There remains plenty of interest from private equity in the programs and MGA space, as evidenced by Onex Partners' acquisition of program administrator Integrated Specialty Coverages from KKR in September, while earlier this month, CVC announced it was acquiring a controlling stake in insurtech Bamboo from White Mountains for $1.75 billion.

And there was significant talk during the TMPAA Summit that further PE-led deals could be in the offing.

At the same time, PAs and MGAs launched with PE backing at the start of the recent market boom could increasingly find themselves on the market as their backers look to cash out.

It is not just PE that has interest in the space, however, with existing MGA platforms also looking to undertake strategic deals to bolster their operations. Ryan Specialty Underwriting Managers, McGowan and startup Balavant were just some of the names put forward by sources as actively looking for M&A opportunities to grow their portfolios.

A likely hindrance to the volume of deals occurring is the number of quality assets that are up for sale, sources said. Those that are regarded as being best in class continue to command valuations of at least the mid-teens, if not more.

One area where there has not been market consolidation is in the fronting carrier space, although there have been acquisitions of such companies, including DB Insurance's recently announced deal for Fortegra.

Contacts were skeptical whether the long-discussed M&A within the fronting market would materialize, although they questioned what the future looks like for some players. There was considerable talk of a "flight to quality" in the fronting market, with those regarded as the best operators growing ever stronger, and those further down the food chain possibly struggling.

ALTERNATIVE CAPITALS INFLUENCE GROWS

A report from Conning earlier this year suggested that 51% of MGAs are now utilizing alternative capital as part of their capacity panel. Some of those that Program Manager spoke to during the Summit felt that figure was likely a little high, but, still, they said there is no doubt is playing a growing role in the programs and MGA market.

Aside from collateralized reinsurers, there was considerable talk of sidecar formation.

Starwind's formation of Fractal Re in 2024 and the creation of Ryan Alternative Capital Re to support Ryan Specialty Underwriting Managers earlier this year are expected to be the frontrunners to a spate of similar sidecar launches, with sources commenting that fundraising for several is currently underway.

THE ROLE OF AI

Speaking to MGAs during the event, there was plenty of talk about the potential of artificial intelligence, but little precise detail on how it is actually being utilized currently. Some have said it supports data scouring and enables MGAs to speed up the time it takes to decide whether to decline or underwrite a risk, while others were more general in their views on its application.

There is no doubt that Al can be used effectively in the market, but it would be interesting to learn more about its widespread application rather than at a few, tech-forward operations.

 View article: https://www.theinsurer.com/program-manager/news/postcard-from-the-target-markets-summit-2025-10-23/

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