Multiple line exclusive agency system is a marketing system under which agents who sell initially property and casualty insurance sell individual life and health insurance products too. The agents generally represent just one insurer or group of insurers that are financially inter-connected or under common ownership. These agents are also known as captive agents.
The multiple line exclusive agency system is also known as the MLA system and/or all-lines exclusive agency system. It is applied to distribute the life, health, and casualty/property products of a group of affiliated insurance organizations or companies through career agents.
Conventionally, the insurance industry has been known to be divided into two parts, life and health, and casualty/ property, but many companies have expanded their portfolios of products to include both kinds of products. Under this system, both kinds of products are marketed at the same time for providing a complete insurance program for the client.
Generally, insurance regulation does not permit the underwriting of life and health insurance as well as casualty/property insurance products under one or the same corporate entity, but the insurance industry can overcome this issue on underwriting powers with the application of parent-subsidiary relationships, holding company structures, and other inter-corporate forms of function. Companies using the multiple-line exclusive agency system are groups of affiliated insurance companies having distinct corporate identities, but those collectively have the authority for selling both life and health and casualty/property insurance.
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