When making a financial plan, insurance should play a vital role in the process. Regardless of your situation, you typically have a need for some kind of insurance policy. Whether you need to protect your life, your home or your vehicle, buying insurance coverage is a necessity to avoid financial calamity. While insurance is a necessary expenditure, you may not like spending money on premiums. If so, you may want to consider working with an insurance broker to help you save money.
What Are Insurance Brokers?
Insurance brokers are individuals who sell insurance policies from many different providers. Some insurance sales reps are captive agents. This means that they work for a specific insurance company and only sell policies from that provider. Other insurance sales reps are brokers and have the option of selling insurance policies from many different companies at the same time. If you are looking at the various insurance companies in your area, those that are marketed as a particular brand name are typically captive agents. Those that have an insurance business in a family name or as some other name are typically insurance brokers.
Why Use Brokers?
Brokers can provide you with a number of advantages that you will not get when working with captive agents. When you work with a broker, you can make sure that you get the best deal from the entire market. Instead of only being able to look at the policies” from a particular insurance company, you get to look at the policies and quotes from multiple insurance companies. The broker can shop around for you and make sure that you get the policy that saves you the most money and provides the best coverage options.
Another advantage of working with a broker is that you do not have to worry about any specific company bias. When an insurance agent works for one insurance company, you know that they are going to try to sell you on that company. By comparison, when working with a broker, the broker does not have any specific loyalty to one brand. The insurance broker will be more likely to steer you to a company that you will like and has your best interests in mind. The broker will not feed you the company lines in hopes that you’ll buy a policy from a specific company. Instead, you can find out honest information from an industry insider that has experience with many different insurance companies.
While insurance brokers can be very beneficial, they may not be able to get you a policy from every insurance company. Some of the biggest companies do not work with brokers and only work through captive agents. Because of this, you may be unable to get a policy from a company that you want to work with. It typically makes sense to check with a broker and a captive agent from a reputable insurance company to make sure that you save as much money as you possibly can when buying a policy.