What is the difference between an Insurance Agent and Insurance Broker? Insurance is something that you cannot do without in your life because like it or not accidents and damages happened and they need to get replaced.
This is where your insurance policy kicked in but it would not have one then it becomes a problem. To get the insurance you are going to need the help of an insurance agent and an insurance broker. That being said today we are going to consider What the difference between an Insurance Agent and Insurance Broker is
This is a topic of interest because most people do not know the difference between an insurance broker and an insurance agent they basically think it is the same. But in today’s article, we are going to draw the line so that you could differentiate between both and know which one is for you. That means said if this sounds like what you are interested in then let’s go ahead.
What is an Insurance Agent?
An insurance agent simply put is an agent or a person working for an insurance company selling insurance products to customers. They can help you get the best insurance policy with the insurance company or companies that they work with. They are to represent the interest of the company that they work with to the customer so that the customer can make the better choice in getting insurance.
Insurance agents are there to help you get the best policy or the policy that is right for you so that you can enjoy your insurance. They represent the interest of the insurance company that they work with and by extension give the customer the type of policy that they want. An insurance agent can either work on a monthly salary or on a commission-based.
Types of Insurance Agents
There are basically two types of insurance agents that work for any insurance company. We have the captive Insurance agents and then the independent Insurance agents. You know I have explained these two types of the insurance agents that are available:
Independent Insurance agents
Independent Insurance agents can basically work for more than one insurance company hence the name independent Insurance agents. They can work for as many companies are they like and they help customers to compare policies to get the best one for themselves. Because they work as independent contractors it doesn’t mean that they do not represent the insurance companies that they work with.
Captive Insurance Agents
In The captive case of an insurance agent, this is an agent that works for only one insurance company and might be directly employed by the company or work on a contract base. That agent is not permitted to sell insurance policies that are not from the company they work with. They can only provide policies from that company to customers that are looking to get insurance with that company.
What Is an Insurance Broker?
An insurance broker in contributing to an insurance agent is a person that is not employed by the insurance company but works to provide customers with the best insurance policy. What they do is help customers to shop for the best insurance policy available so that customers can find the one that suits their unique needs. Insurance brokers are usually not employed by insurance companies.
They usually possess good skills in comparing various policies so that customers can make the best choice with the right knowledge to get only the best insurance policy. If you are having a problem making your mind up on what type of insurance coverage you need or policy they are the ones for you to call. They work more for you than for the insurance company and they earn their money from helping customers pick insurance policies.
What is the difference between an Insurance Agent and Insurance Broker?
Knowing the difference between two things can help you easily pick the one that is right for you which is why you need to know the key differences between an insurance agent and a broker. So below I have tried to simplify things very much for You by listing some of the differences between both:
- The first difference is that an insurance agent represents the company’s interest while the broker represents the interests of the customer or client.
- Another reason is that the insurance agent says insurance policies to customers while the insurance broker does not sell insurance policies it helps customers pick the right one.
- An insurance agent typically works by being employed or contracted by the companies but an insurance broker is not employed by the company.
- An insurance agent helps you to shop for plans with the insurance company they work with but brokers help you shop for plans with multiple insurance companies.
- An insurance agent has the ability to enroll you in insurance coverage while an insurance broker does not.
- Most insurance agent usually receives salaries or commission but brokers only receives a commission.
- Insurance agents do not charge customers but insurance brokers might ask you to pay a broker fee.
These are some disadvantages between an insurance agent and a broker. Hopefully these differences we help you to pick the one that you need for your insurance policy.
Should You use an Insurance Agent or Broker?
This is one of the most serious insurance questions that many people ask. Because they have not really known the two differences between an insurance broker and an agent they did not know which to go for. But the question is very easy to answer. If you are so busy that you are too lazy to shop around for the type of insurance policy that you need then you definitely need an insurance broker.
If you are the type of person that already know what you are going for which is in terms of the policy you want to get an insurance company you want it from then you can go for an insurance agent. Also if you want to shop around for the cheapest yet best insurance policy then an insurance broker is the right choice for you. With this in mind, you can now make your choice between both.