[1] Similar wordings can be found in the statutes of Oklahoma, Idaho, Arizona, Nevada, Wyoming, Florida, and Alabama.)
Historically, managing general agents came about when insurance companies located in the eastern United States in the late 19th and early 20th centuries, primarily in New York City, wanted to expand their markets to the western United States, but didn't have the resources to open a regional or local office.
Managing General Agents filled that need by providing local resources who were able to properly underwrite the risks, service the policies, and handle claims.
As technology has evolved and many of the obstacles associated with conducting business in a distant geographic location were overcome, many insurance carriers have stopped using Managing General Agents.
However, as the insurance market has hardened, carriers are now using Managing General Agents as a means to limit cost and increase profitability.