Managing General Agent Information

A Managing General Agent (MGA) is defined as a person who manages all or part of the insurance business of the insurer, including the management of a separate division, department, or underwriting office who underwrite an amount of gross written premium equal to or more than 5% of the policy holder surplus as reported in the last annual statement of the insurer in any one quarter or year together with one or more of the following:

• adjusting or paying claims in excess of $10,000
• negotiating reinsurance on behalf of the insurer

Prior to applying for the registration, the MGA must be currently licensed as an insurance producer for Property & Casualty authority and must already hold a producer appointment for the insurer(s) for which they are acting or will act as a MGA.

All MGA registrations and appointments expire annually on April 30, regardless of the date of initial issuance. There is no late renewal provision for MGA registrations. The registration and appointment will expire if not timely renewed.

Insurers are required to review their books and records quarterly to determine if any producer has become an MGA. If an insurer determines that a producer has become an MGA, the producer must be appointed by that insurer as an MGA within 30 days. The producer must register as an MGA if not already registered.

Application for New or Renewal Managing General Agent Registration

Managing General Agent - Insurer Appointment or Cancellation

ACT 488 FINANCIAL REPORTING REQUIREMENTS

Act 488 of the 2024 Regular Legislative Session created additional financial reporting and other requirements for MGAs. These requirements are effective August 1, 2024.

Quarterly Insurer Reports
At least once each calendar quarter, an MGA shall submit an account report to each insurer with whom the MGA has a contract, and include in the report, as applicable, a statement of all of the following:

• Written, earned and unearned premiums.
• Losses and loss expenses paid and outstanding.
• Losses incurred but not reported.
• Management fees.
• An outline of expenses, on a form prescribed by the commissioner, incurred by the MGA in the performance of duties under its contract with the insurer.

Managing General Agent Quarterly Insurer Account Report

Reports to the Department of Insurance
In addition, an MGA shall notify the Department of Insurance within 30 days of the date any of the following occurs:

• Balances due to an insurer for more than 90 days exceed either of the following:
• One million dollars.
• Ten percent of the insurer's policyholder surplus, as reported in the insurer’s annual statement filed with the department.
• Balances due for more than 60 days from a property and casualty agent or MGA appointed by or reporting to the MGA exceed $500,000.
• Authority to settle claims for an insurer is withdrawn.
• Money held for an insurer for losses is greater than an amount that is $100,000 more than the amount necessary to pay the losses and loss adjustment expenses expected to be paid on the insurer's behalf within the next 60-day period.
• The contract required pursuant to R.S. 22:1624 is cancelled or terminated.

Audited Financials
Insurers are required to have an independent audited financial report of each MGA with which it has done business. The audited financial report must include the opinion of an independent certified public accountant, report the financial position of the MGA as of the most recent year-end and the results of its operations and cash flows, and include appropriate notes to financial statements. This report is required to provided to the Department of Insurance upon request.

Prohibition on Certain Persons Acting as an MGA
Persons who served as an officer or director or who had direct or indirect control over the selection or appointment of officers of an insurer that became insolvent may not act as an MGA if that person held that position in the 2-year period before that insurer became insolvent unless that person demonstrates that their personal actions were not a significant contributing cause to the insolvency.

Examination Authority
MGAs may be examined as if it were an insurer and shall submit to an examination if determined to be necessary. The MGA is responsible for examination expenses.