General Question

ftp901's avatar

What's the advantage of buying insurance from a broker instead of the insurance company itself?

Asked by ftp901 (1300points) November 27th, 2010

I have car insurance through a broker right now and it’s very expensive. I have a feeling that if I shop around a bit I’ll be able to get a cheaper price directly from an insurance company or bank. However, would I be missing out on any level of service by doing that? If I get in an accident I would like to have someone knowledgeable who I can call right away to help me. Is that what a broker is for?

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6 Answers

janbb's avatar

An independent agent or broker will work with different companies to get you the best coverage. Working only with the company, you can buy only that company’s products. The independent agent may also give you better service in the event of a claim, but depending on the direct company, you may get very good service from them as well. I would shop around and compare prices; just make sure you are comparing apples to apples in terms of coverage.

flutherother's avatar

I found I got a better rate going through a broker. Shop around is the best advice. You might also want to check if the policy is protected by the FSA (in the UK)

iLove's avatar

As a former agent, @janbb is absolutely correct. Not only that, but an agent will help you find solutions that will keep your costs low. Also, if you work with the best agent, you can prevent yourself from getting declined if the agent advises underwriting to withdraw the app in case of declination. This is a huge benefit – you never want to be declined.

Also, the agents rates provided to you are the EXACT same as the company’s rates. The commission is always built in.

At renewal time, your agent can advise you of better rates elsewhere and analyze your current plan to see if it is the best match for your needs. Often the insurance carriers will just keep you in the same place instead of suggesting a better option for you as your needs change.

jca's avatar

My agent gives great service, which is an advantage. Prior to having my payments deducted automatically from my bank account, the agent used to call me and let me know when payment was overdue. if I have an accident or issue, i can call the agent to ask for advice, which beats having to call an 800 number and dealing with a switchboard and various people/departments. my agent works for the insurance company (state farm).

downtide's avatar

Generally a broker will shop round lots of companies and choose the cheapest one for you. BUT a broker will not shop round ALL insurance companies because some do not deal with brokers, and others who do will charge a higher premium. So you can often find something cheaper still if you skip the broker and shop round yourself. But that takes longer; the advantage of the broker is that it saves you the time and effort of doing the search yourself.

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