2006-08-20 09:44:37 · 8 answers · asked by Tom K 1 in Business & Finance ➔ Insurance
Generally speaking an "agent" is an individual licensed by a state to represent an insurance company to the public. An independent agent means the agent is not "captive" or only contracted by one insurance company and may represent more than one company. A "broker" is an individual licensed by a state to represent the general public to insurance companies. They are usually contracted with several insurance companies and their job is to search the insurance market for the person they represent. The amount of commission paid to a broker or agent is usually very close to the same and has absolutely no bearing whatsoever on the premiums that a person pays for insurance. If an individual goes to the insurance company directly to purchase insurance the commission will either be kept by the company or paid out to the individual that assists you on the phone or in person when filling out an application. Some insurance companies will not allow "direct" applications and require the use of agents or brokers. Many states are doing away with the "broker" and "agent" terminology and simply calling anyone licensed to accept insurance applications "producers".
2006-08-21 05:24:26 · answer #1 · answered by Rutherian 1 · 2⤊ 0⤋
Effectively, none. In the insurance business, they are pretty much used interchangably.
Technically, the agent works for the companies, and the broker works for the clients. Practically, independent agents and brokers work to match up clients to carriers, and most of the time are paid by the carriers on a straight commission basis.
2006-08-20 15:23:42 · answer #2 · answered by Anonymous 7 · 2⤊ 0⤋
An Independent agent represents an insurance company or several companies. An Independent Broker represents the client directly. There are distinct legal definitions that vary from state to state. Insurance is regulate at the state level. This definition is paraphrased from the Washinton State office of the Insurance Commissioner. There are similar definitions on the California Department of insurance site
2006-08-20 12:21:25 · answer #3 · answered by we_build_champions 2 · 1⤊ 0⤋
I used to work for an insurance agent with a major company. He owns his agency and pays his employees etc... He is considered an independent agent but is also what is known as a "captive agent" in that he can only sell Nationwide Insurance policies. Brokers are agents that shop around to different companies to find the best rates. They must be licensed as a broker but your policy may be through Hartford whereas my policy may be through Integon or Lloyd's of London. Does that make sense?
2006-08-20 12:22:00 · answer #4 · answered by swomedicineman 4 · 1⤊ 1⤋
an independent agent works exclusively for one company, an independent broker works with many companies and can usually find you the best deal
2006-08-22 08:51:58 · answer #5 · answered by missv 1 · 1⤊ 1⤋
an independent agent is not state related, therefore they have to sometimes seek their companies through independent brokers who then get with the larger companies. but if you can find a standard company, like statefarm, you get it directly with less commissions to pay each agent, broker, and so on
2006-08-20 09:51:52 · answer #6 · answered by Karen Elaine 4 · 1⤊ 1⤋
An agent has the authority to act on behalf of on or more companies. That means they can actually approve you application. A broker must submit the paperwork to the company for approval.
2006-08-20 11:38:06 · answer #7 · answered by STEVEN F 7 · 1⤊ 1⤋
typically, the agent is working for a specific company and a broker is not captive, able to get appointed with any company.
2006-08-20 10:56:29 · answer #8 · answered by tigertiggerii 3 · 0⤊ 1⤋