I'm researching insurance producers. What's the difference between an agent and a broker?

Answer 1

Technically, an agent represents the company, and a broker represents the insured.

Practically, most people call both types "brokers".

In the industry, the broker is the wholesaler, and the agent the retailer.

If you're shopping for insurance, look for an independent agent - that means, he can sell insurance from more than one company. If you're trying to get into the business, the exam is the same for agents and brokers, as is the license.

Answer 2

Hi, your friendly insurance guy here again! :)

As a prior poster mentioned, an agent is typically an employee of a particular company, while a broker tends to be independent and will tend to sell products from multiple companies.

The assertion made, however, that an agent is somehow in a poor position to help a client, or will not look out for a client's best interests, is in poor taste and incorrect.

The main difference between the two will tend to be the diversity of products they have available for sale. In some cases and agent can have access to numerous products, many of which will not even be from the company employing him. The level of interest in doing the right thing for the client has nothing to do with whether a person is an agent or a broker.

For a time I was an agent for a large insurer. In addition to the insurance products that company offered, I had access to the products of about 80 other carriers' products available in my state.

At no time was anyone in the agency where I worked instructed to favor one company's products over any other company's products. The order of importance was always to place the needs of the client first. To suggest that someone's ethics in how he or she conducts business are determined by the type of contract under which the person is employed is insulting.

I work in an independent office at the moment, so I'm not in a captive environment, and I'd never suggest anyone working under an agent contract is "not looking out for a client's best interest" just because of how he or she is contracted.

Ethical people are all over the place, just like unethical people can be found all over the place. Throwing a blanket generalization like that is unfair to the ethical, agent-contracted people out there who work hard for their clients. By corollary, just because someone is under a broker contract does not in any way guarantee he or she IS looking out for a client's best interests.

To anyone seeking insurance I suggest you interview several representatives till you find one that you feel is working on your behalf and with whom you are comfortable. Worry less about how that person is contracted than about the quality of service delivered, the quality of the products available, and the level of comfort you feel with the thoroughness and ease of the process you go through to become insured.

Answer 3

An agent works for the insurance company. A broker works for the person who is buying the insurance, the customer. Therefore, if you want the best deal and want to get someone to look out for your best interests, you should get a broker.

Answer 4

An agent would most likely represent only one company, unless he was working a split with another agent. A broker is still an agent, but he may have agency licenses with more than one company. In theory, the "broker" might search various insurance companies to find the one most likely to do a good job for the client, in theory. More often, the "agent" is looking for the best commission for himself and the captive agent, is looking for most commission for himself.

Answer 5

Any agent works for the insurance company and a broker works on behalf of the client.

Answer 6

The terms are interchangeable! And agent may be representing one company; a broker works for a number of companies.

I personally fee; that a broker is only as good as the companies they represent. I spoke to a lady from NV and she told me what she had been told, but I know of products that are designed different and gave her some things to think about and - - -

WHAT QUESTIONS TO ASK to make sure that she had the complete questions!!!

Answer 7

An agent only has access to their own company's programs, a broker has access to many insurance companies (they basically shop around for the best deal for you.)