Something remarkable happened in Estonia after the disintegration of the Soviet Union. Across the tiny Baltic nation, the governance of the newly independent country, and the management of almost every organisation and institution in it, was handed over gracefully by the incumbents to the up-and-comers, typically people in their later 20s. A youthful revolution occurred.

Estonia was unshackled from the limitations of Soviet telecommunications technology, with its single international telephone line routed through Moscow. The new cadre of young who now ran things were offered Finland’s 1970s analogue national telephone exchange platform gratis, but they rejected the largess. Instead they leapfrogged to an all-digital network. It was years before any other nation made such a leap.

I didn’t notice this when I visited (I had no wireless device to connect to Eesti Mobiiltelefon’s GSM network, launched in 1993), but it was impossible not to notice road-signs everywhere with a blue-and-white @ symbol. They indicate a nearby public internet access point. Estonia had become a global telecommunications leader.

I was reminded of this great technological leapfrogging by the vibe at the FASE conference for MGAs in Barcelona earlier this week. There’s a huge parallel between the young Baltic nation with EU ambitions and the explosion of new and newish MGAs seeking success in Europe’s fast-growing MGA market.

Most of the MGAs I met at the event (media sponsor: Reuters The Insurer) and many others are enviably able to make a similar technological metaphorical leap. They can go straight to the latest underwriting, claims, and processing technology. They don’t have to write off a gigantic, decades-long investment in old tech. With no legacy cramping their style, they can race ahead with highly efficient, purpose-built, AI-driven systems that give them a lead.

As an aside, I was surprised to read here after the conference that some unnamed reinsurance broker said a lack of MGA-specific technology infrastructure in Europe means “the juice” available from their growth in Europe “isn’t worth the squeeze.”

That’s just wrong.

The FASE conference wasn’t overpopulated with technology vendors plying their wares, but at any London insurance event it’s difficult to walk through the door without tripping over someone offering MGA-specific technology infrastructure suited to pan-European MGA trading. Oodles of great, cutting-edge tech exists. Some of it is really, really good.

Insurance technology, whether AI-infused or simply digital, supports everything from cross-border portfolio amalgamation and accumulation-risk monitoring to regulatory compliance across the vagaries of local reporting minutia, multinational know-your-vessel requirements, and multi-currency accounting with flexible, multilingual reporting.

Ditto jurisdictionally agnostic tech like underwriting platforms, product configuration systems, and claims and policy management tools. In short, the range of technology infrastructure to help make your trans-European MGA a success is just an email away. If you’re starting from scratch, it’s a no brainer. If you’re relatively new and expanding, the challenges and costs of upgrading are relatively minimal.

By adopting whizz-bang tech, MGAs gain an enormous advantage against incumbent European carrier-competitors. Traditional players typically operate colossal legacy tech stacks that stifle their ability to act or move fast, let alone to innovate swiftly in response to market opportunity, and it’s hard for them to escape.

Not long ago, data migration projects could take years. The more systems and formats and fields, the longer the project. And it’s not just the time and resources. Old-style extraction, transformation into something transferrable, and ingestion into a new system often required stripping historical data down to its basics by removing all but the most pertinent fields.

All these factors mean that almost all established insurers, and a lot of the larger MGA consolidators too, hold their data in old warehouses in unfriendly formats with the wrong fields. It’s processed by years-old tech, sometimes decades old, very often with multiple platforms chugging away in parallel. Despite the inefficiencies, they just can’t face the challenge of getting it out.

It’s a leapfrogging advantage for MGAs, but they need to take advantage quickly. Tech is improving for incumbent carriers too, and they’re unlikely to hand over to the up-and-comers with a grudging smile. They realised a while back that they can upgrade in smaller bites, one class team at a time, rather than upending the whole firm at once. Many have begun to do so.

More recently, artificial intelligence has made wholesale switchover very much more attractive. The technology to execute a complex data migration probably exists right now in your pocket, on your phone. AI has removed almost all of the challenge from the process, allowing projects that would have taken years to be completed in a month or two, maybe even weeks. Many big players are beginning to take advantage.

When they have done so, they too can have a shiny new leading-edge technology platform. MGAs will retain a load of other advantages, but now’s the time to press the digital differentiator. We’re only young once!

Guillaume Bonnissent is CEO of Quotech.