AAMGA’s Outgoing President Reflects on Importance of Membership

As nearly 1,500 members of the American Association of Managing General Agents (AAMGA) prepare to descend on the spectacular desert plains of Arizona for their annual convention, outgoing President Ronnie Moore found some time to sit down with Insurance Journal to discuss more than just the events of his presidency.

Moore, president and sole owner of Southern General Agency Inc. in Bowling Green, Ky., believes whole-heartedly in the value of being a member of AAMGA. He believes in the value of the general agency distribution system and its place and purpose in the “big picture” of insurance.

Moore began his insurance career with Safeco Insurance Company in 1966. Then in 1974, Moore and his wife, Betty, moved to Bowling Green to start the Southern General Agency. He has served as the past president of Kentucky Surplus Lines Association and past president of the Kentucky Lloyd’s Agents Association. He was also appointed Commissioner of Insurance for the Commonwealth of Kentucky from Dec. 1991 to Nov. 1992.

Insurance Journal: What are the benefits of an AAMGA membership for managing general agents?

Ronnie Moore: Well, I think the primary benefit of being an AAMGA member is the camaraderie that you get from the networking with the other members. This has been one of the long-standing goals of the AAMGA. And this is something that we continuously try to afford as an opportunity for our membership to network among members, associate members and business service members. And by that networking I’m talking about having round table discussions so members can speak up about new ideas and/or problems they are having be it technology, coverages or companies that are writing certain coverages, and the opportunity to get in touch with companies to see about representation. So, the advantages of being an AAMGA member we think are the networking opportunity.

We have a code of ethics that is very strong that is very explicit about the conduct of the members. So if someone did get out of line there are rules in place to take whatever action necessary to either remove the member from the association or to see about getting them get back into the code of ethics and not in violation.

IJ: Why do you feel that the industry needs managing general agencies and will there always be a place and need for general agencies in the market place?

Moore: Well, it’s my position that the distribution center that the managing general agents provide for companies has in and of itself been one of the reasons for the so-called specialty insurance sector’s survival. We feel that our distribution center helps many insurance companies get their products out to more agents, more often, than if the companies actually put field people in to oversee marketing and production for the same type of product. So from that standpoint, the managing general agents I think will always be a needed and a very useful distribution system in the U.S. insurance market.

IJ: What are the top three challenges facing MGAs today?
Moore: I think that technology is one of the biggest challenges because we seem to have so many different ways of doing things from a technology standpoint, as well as the need for more uniformity. I would hope it [the solution] would be coming down the pipe to help MGAs be more.

I think mergers and acquisitions is also a current factor in our sector of the insurance industry and I think that’s only going to continue during this hard market. I think some of the bigger agencies are wanting to and have an opportunity to get bigger and I think some of the smaller agencies that need to have better technology and more volume from their companies will be looking in the direction of merging. I think has been a benefit for those that have merged because they are able to accomplish more than when they were individually owned.

I also think there are challenges that lie ahead for companies doing very well right now with this hard market. We need to see what adjustments are going to be made by them as the market becomes a little softer or as I use to say as the pendulum swings back toward normalcy. So, I think from that standpoint the agents and the companies are going to be working much closer together with the use of the technology.

IJ: What typically happens to the MGA market as it approaches a soft market?

Moore: I think the largest thing that happens is that the other companies that had been either dormant or at a low share in the market decides that its time for them to increase their market share and so in several cases in the past we’ve seen companies reassert themselves and come back into the market. Unfortunately, they come in at a more aggressive rate than what’s out there and end up in essence buying business. So, it creates a market flurry of people trying to maintain market share and also trying to maintain price stability. And an MGA certainly doesn’t want to see their production drop, so they look for ways to increase their production on an annual basis. This puts added burden on our sector in trying to keep our business plus maintain rate stability.

IJ: From your perspective, why would a retail agent chose an MGA over another if both firms represent similar markets and expertise?

Moore: I asked that question in a recent survey and the number one response was service. If our agency, or any MGA, is able to outperform another one by getting out quotes quicker or issuing policies quicker, then there is an ease of doing business. That seems to be the criteria for doing business with a certain MGA versus another if they are quoting the same companies on a piece of business.

IJ: Looking back on your year as president of the AAMGA, what accomplishment(s) are you most proud of?

Moore: Well, I think one of the things we worked hard on this year was to be heard and to be seen more often. And I think this year we have been heard. We’ve been in a lot of the periodicals on both a national and regional basis, and we have been in attendance at various functions from the National Association of Insurance Women’s Annual Convention to the western states annual convention to the NAPSLO Mid-year and other annual events along with the various AAMGA functions. So I think we are more visible and have been seen and heard from the members standpoint. This gives the AAMGA a firm foundation as to why we have been in business in 78 years.

Also, by going out and stressing the value of being a member to our associate members, it was very good to hear from the companies we represent that they look at an AAMGA logo meant more to them than those that did not have one on their paper. And, getting out our voice more to retail agents by increasing our attendance at their annual conventions and telling them about the AAMGA.

IJ: Why do think MGAs return year-after-year to your annual meeting and what can we expect from this year’s meeting?

Moore: The main reason they come is the quality and professionalism of the meeting. The opportunity to meet not only other AAMGA members but also the associate members and business services members that help make up our business day. People are continuously networking during this convention and have found this to be very fruitful.

IJ: Any advice you would like to pass on to your successor Joseph Hutelmyer?

Moore: Joe is a very smart young man and will do a great job. He was a lot of help to me this year and will make an excellent president.