When you are in the market for insurance, knowing who you can trust and turn to for independent advice is an important part of the process. If you’re unsure about the difference between an insurance broker and insurance company, check out the details here before you choose so that you are getting the one that best meets your needs because they are not the same.

Insurance Broker

Traditionally, an insurance broker represents a number of different insurance companies. They are informed and knowledgeable when it comes to the types of products and policies offered by the various companies they represent. So, if you go to an insurance broker to get a quote on a car insurance policy, they will get you quotes from the various insurance companies they work with.

That’s good news for you, because it means a broker has access to a wide range of products, coverage options, discounts and prices.  They are not only able to find the best insurance for you, but they’ll also shop around and compare other options to get you the best coverage at the best rate from the many insurance companies they represent.  A broker can also find out what discounts are available from different insurance companies and help you take advantage of the best option.

A broker essentially helps you find the best coverage for the best price and does a lot of the work for you – comparing rates, finding the best value, and finding a policy that meets your individual insurance needs.

Insurance Company

An insurance company, on the other hand, offers the actual policy and if they are selling the policy directly to the customer they typically offer one option.  There is no choice.  So, if the provider is not able to offer multiple insurance options, you are likely dealing with an insurance company, a direct writer or a captive agent.  There is no choice.  There are no options.  They provide one product and one rate.

There are some providers that try to look and act like a broker but in reality, they sell for a single insurance company.  So ask, “how many different insurance companies do you represent?” If they don’t list a bunch and say Aviva, RSA, Intact, and Travelers for example, they are likely not a broker.

What is the role of the broker after you purchase a policy?

They work closely with you to ensure that you have the policy that best meets your unique needs. As new products and coverage becomes available, they make sure you are up to date and informed about your insurance policy. They will review your policy against the many options available and make recommendations to you regarding the placement of your policy to ensure the best rate and best coverage each year.  They are always happy to answer any questions you might have and take care of you and your policy in general when it comes to payments and changes. In the event of a claim, they are also your advocate during the process.

Are there brokers that work directly for an insurance company?

Often in thinking about the job of an insurance broker, most will agree that  these are independent and as mentioned, capable of representing a number of insurance companies as they explore the options to get you the best deal. However, there are some “brokers” who work directly for a single insurance company. They are commonly referred to as agents as they only represent one company, meaning that they cannot offer you options. Don’t be fooled by those providers pretending to be a broker when in fact they are working for the insurance company not the customer.

Brokers dealing with multiple insurance companies are better positioned to offer you more flexibility in terms of what they can offer when it comes to coverage and prize, which helps get you a policy fit for your individual needs.

Your best insurance option is always an insurance broker.  Call Munn Insurance today at 1-855-726-8627 if you’re looking for some help, or if you are currently with a direct writer or captive agent.  Better options and better prices are likely available for you.