AAMGA’s Incoming President Levy Talks About Challenges, Opportunities

For 90 years the American Association of Managing General Agents (AAMGA) has dedicated itself to the growth and sustainability of the global specialty distribution marketplace. This year’s incoming AAMGA president, Ed Levy, vice president, Western region binding, for Risk Placement Services Inc., says that while AAMGA’s core values remain unchanged, diversifying and adjusting to new market realities will be a focus of his tenure.

As the AAMGA prepares to open the doors of its 2016 Annual Meeting in Scottsdale, Ariz., May 22-25, Levy took some time to discuss the association’s changing dynamics and what he hopes to accomplish as its new leader.

What challenges and opportunities are members of the AAMGA facing today?
The association is continuing to follow its strategic plan, which we revised last year, that states we are to be the association that specializes in wholesale distribution via underwriting operations. Our focus will be on some of the challenges we face. One of those challenges is succession. We have seen more young people enter the industry, but it’s still challenging to get new talent to look at our end of the business. Getting them trained is also an issue because there’s not a lot of training for what we do. And creating a more diverse industry.

Why is diversity an issue?
There are more and more women in the industry but adding more diversity throughout the industry is still a concern. While it’s a challenge, we think it’s also an opportunity.

At this year’s convention there’s a new focus on program business. Why?

The insurance business world is changing from the standpoint of what and who we are. There is a tremendous amount of specialization occurring so we have a strong focus on trying to build that end of the association – program managers and program administrators. We are still specifically wholesale based. We are true to our core, which is we are an association representing the wholesale distribution model. But yet we have adjusted to reflect the changes in the marketplace. This year’s convention will have well over 230 people representing the program space and more than 50 risk bearers that specialize in program business. It will continue to be a strong emphasis for us.

Given the changing dynamics of the industry, would you say the model of an MGA is also changing?
The model is still evolving. In reality, our venture into the program space is because they do what we do. They are underwriters. We believe that that model will persist. It’s an interesting dynamic that’s taking place. People are looking at MGA operations and program administrators because of the viability of what they bring to the table and quite honestly the returns.

How would you describe the market today? There’s quite a bit of competition.
Times are difficult today. The market is soft but there are also opportunities out there. But those opportunities are interesting. Some of the opportunities are economically related and some of the challenges are economically related. There are some new businesses starting and our membership is usually the people who get those opportunities because the standard market doesn’t want startups. Some of the challenges that are economically driven are things like the energy business. Whether it’s oil fields to fracking to transportation; that business has slowed down, businesses have shut their doors, truckers are no longer transporting, oil or waste water or whatever else in and out of those fields, that business is gone. So it’s a challenge.

Then when you look at transportation, everyone talks about how bad the loss experience has been but yet the competition in that market in many states is now fierce even with fewer markets available. That is interesting. …

The market today is really a two-edged sword. On one hand there are challenges, but on the other hand there are opportunities. You just have to find those opportunities and that’s the goal of a wholesale operation – adjust to the needs of the time.

What is your top goal as the new leader of the AAMGA?
Education, diversity and recruitment.

Topics Excess Surplus Training Development Insurance Wholesale