Guy Carpenter & Company published the results of its fifth annual survey of specialty insurance program issuing carriers. According to the survey, the program administrators and managing general agents market showed little change from 2008 to 2009, despite the global financial crisis. Though the number of respondents perceiving a growing market has declined, the market outlook generally remains upbeat, considering the tumultuous market conditions.

Guy Carpenter said that 46 percent – felt that the PA/MGA market would remain flat, with 37 percent forecasting growth and 17 percent anticipating some contraction. (In the 2008 survey, 32 percent believed it was flat, 56 percent thought the PA/MGA market was growing and 12 percent though it would shrink.)

Profitability perceptions remain unchanged, with 92 percent of respondents estimating a combined ratio for the market of between 90 and 100 percent. Forty-nine percent put the market at 90 percent to 95 percent, down from 68 percent last year.

Market conditions have reshaped the challenges that MGAs are facing.The survey found that only 67 percent of respondents view new business production as a challenge, down from 77 percent in 2008. Concern about premium growth also declined, slipping from 66 percent last year to 58 percent this year. Maintaining current rate levels, however, is perceived as being more challenging, with 61 percent of respondents citing it this year, compared to 58 percent in 2008.

Reinsurance continues to play an important role for program issuing carriers, with 37 percent working with reinsurance intermediaries and 63 percent utilizing a combination of intermediaries and direct reinsurers. This represents a substantial shift from 2008, in which 83 percent used both intermediaries and direct reinsurers.