An insurance broker-agent is an insurance professional who plays the role of both an insurance broker and an insurance agent.
Insurance broker-agents work for either a single insurance company or a group of insurers – typically on a contractual basis.
The primary goal of the broker-agent is to explain insurance products to potential customers of a specific insurance company, then recommend the best insurance products for the needs of that customer. This is the ‘agent’ part of the broker-agent’s job. As a ‘broker,’ meanwhile, the broker-agent also has some leeway to shop around on behalf of clients, recommending other insurance products based on the client’s needs.
Insurance Brokers Versus Insurance Agents: What’s the Difference?
To understand the role of an insurance broker-agent, it helps to understand both roles.
Insurance Brokers: Insurance brokers recommend products from multiple insurance companies. The broker analyzes your needs and budget, then recommends the best policy options from different companies. In many cases, brokers can offer lower rates than what you would be able to get on your own. The broker gets paid commissions when a customer purchases insurance.
Insurance Agent: An insurance agent is an employee of a specific insurance company. The agent recommends products from that specific insurance company, and the agent can only sell products from that specific company. Typically, the agent receives a salary in addition to sales bonuses or commissions.
An insurance broker-agent, meanwhile, plays both of these roles. The insurance broker-agent will recommend products from specific insurance companies while also having some flexibility to recommend products from other insurance companies.
Some insurance broker-agents are salaried employees of the insurance company. Others are contractors for a group of insurance companies. Some are self-employed ‘free agents’.
Insurance Broker-Agent Job Duties
Insurance broker-agent job duties vary between companies. Some companies simply call their insurance agents “broker-agents” to convince customers that they’re getting the best rates, for example.
Other companies hire broker-agents on a contractual basis to drive customers to their business.
Some broker-agents are free of any contractual obligations and work more like brokers than agents: they’re able to recommend insurance products from multiple companies without having a bias towards any specific company.
Some broker-agents work specifically with enterprises – like giant corporations – to solve their unique insurance needs. These broker-agents specialize in a specific aspect of the insurance industry, allowing them to recommend the best products for individual enterprise needs – like insuring a fleet of vehicles or covering thousands of employees.
Ultimately, broker-agent is a general term with no fixed definition. The role of the insurance broker-agent varies between companies and insurance professionals. Generally, however, the insurance broker-agent can offer low prices on a variety of insurance products from one or more insurance companies.