What Is an Insurance Agent or Broker?

Here, you will find the insurance agent definition: An insurance agent or insurance broker is a person who represents an insurance company at the selling level. An agent’s work is to attract clients and present offers to them that fulfill their insurance necessities as potential customers.

Continuing with the insurance agent definition, an agent could work with the customer and gather information to perform the risk analysis on the client’s policy. An insurance agent would also do the difficult task of completing the required documentation to underwrite the mentioned risk correctly with an appropriate insurance policy.

Most states have individual requirements about this paperwork, concerning its printing, layout, content, etc. The insurance agent has the obligation to complete the documentation meeting all these legal requirements in a suitable way.

When there are more complex insurance situations, like fleet auto insurance arrangements, for example, the insurance agent could assist the client in getting a combination of smaller policies rather than a unique large one.

Legal Requirements for Insurance Agents in The United States

Each state issues individual broker licenses in the United States, and the insurance industry business is extremely regulated. For making things easier for insurance agents, mostly all states have reciprocity deals that allow a licensed broker in one state to work as a licensed broker in another state without much trouble. Nowadays, the licensing requirements between the states have been homogenized, and an agent could even apply for his or her license online.

The smaller insurance agents could compete on equal terms with larger firms. There are laws in place that prevent major insurance companies from offering incentives to win large businesses, such as rebates and additional discounts on the price of the insurers’ policies. Licensing in the United States assures that the client receives a just and fair representation from insurance brokers and agents. It also guarantees that clients get a level of service of adequate standard.

What Are Insurance Agents Helpful For?

In case you are needing special auto insurance plans due to your particular financial situation, you can always opt for $20 down car insurance. Insurance agents could be substantially helpful for both clients and companies. They could explore and find cheaper rates than a person would get if he or she approaches an insurance provider directly.

Are Insurance Brokers and Insurance Agents the Same Thing?

Legally, there is no difference between the insurance agent definition and the insurance broker definition. Nevertheless, in everyday practice, the relationship between the agent and the insurance provider is often ruled by the terms of the insurance company rather than the customer’s interest. A broker has no contractual representation with the insurance provider and trusts on different ways of finding insurance offers for the clients he or she represents.

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