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Broker vs. Agent: Here’s What You Need to Know

Jan 16, 2020

So, it’s time for you to pick up insurance. Maybe you can’t wait to start driving your new car but aren’t sure how to navigate the process for obtaining business, home, and auto insurance. What do you do?

You contact a professional to help, of course! Get in touch with an insurance broker or agent. But who should you pick when shopping for home or auto insurance in London, and is there even a difference? It’s easy to throw both terms around aimlessly, but let’s talk about the important differences between the two.

How Insurance Agents and Brokers in London Are Similar

Here’s the deal. Both agents and brokers sell insurance. They both function as your contact point for an insurance provider. Their goals are the same: to sell you suitable coverage plans based on your needs. And both jobs require licensing and knowledge of insurance regulations.

That’s about it, so let’s get into the more interesting part. How are brokers and agents different, and which option should you choose for your insurance needs in London?

Who They Represent

An agent works for a single insurance company and sells policies for them. If you work exclusively with an agent, you are limiting your options to a single provider. There are two types of agents: captive ones that work for a single company and independent ones that represent multiple firms (but still only those).

A broker works with the buyer to find any suitable insurance provider. Their job involves comparing several policies on the market from many providers to find the best fit. The more companies a broker affiliates with, the more likely they will be able to find you an attractive plan that fits your needs.

Their Knowledge

Agents tend to have more specific expertise in the companies they represent.

In contrast, brokers must stay up to date on the latest trends, coverages, and everything related to insurance policies you may be interested in.

Their Authority

Both agents and brokers have binding authority to underwrite policies. The overall guidelines are issued by the insurance companies themselves.

This makes brokers a more attractive option because they have access to multiple companies, each with their own approach to determining binding authority.

How They Receive Compensation

Clients never pay brokers or agents for the work they do. Both parties are compensated by the insurance companies themselves. That means you get the best insurance policy possible without needing to pay extra for the work provided by brokers.

Which Should You Choose?

Is a broker or an agent the right solution for you when searching for auto and home insurance policies?

For most people, a broker gives you a better chance of getting the policy you want. Insurance can be complicated, so a dependable broker is a vital component of your search. Comparing premiums across different providers is an invaluable service and helps you get the best rates possible.

Get in Touch With Cane & Co. Insurance Today

Whether you want home, auto, or even business insurance, don’t delay getting an insurance broker around the London, Ontario area. Cane & Co. Insurance is here to help you obtain the coverage you need.

If you are in the market for an insurance policy in London—don’t hesitate to contact us! Our team is always available by phone at (519) 601-1100.

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