Insurance agents and brokers

Insurance agents and brokers who specialize in property and casualty insurance help small business owners buy insurance coverage from insurers at a reasonable price (or premium). Agents and brokers are licensed in their states and must comply with all governing statutes and regulations.

Insurance agents and brokers can specialize in offering one form of small business insurance. Or they can provide many different types, including:

• General liability insurance
• Business owner’s policy (BOP)
• Errors and omissions insurance (E&O)
• Professional liability insurance
• Commercial property insurance
• Business interruption insurance
• Workers’ compensation insurance
• Commercial auto insurance

An insurance agent is a professional who sells an insurance company’s products to consumers for a commission. To sell insurance, an agent helps consumers select the right insurance to buy, but represents the insurance company in the transaction.

There are two types of insurance agents:

• Captive agents typically represent only one insurer.
• Independent insurance agents typically represent more than one insurer.

Both captive and independent agents work on commission and can execute an insurance transaction from start to finish, on a variety of insurance plans.

An insurance broker is a professional who represents consumers in their search for the best policy for their needs. Brokers work closely with their clients to research the client’s needs. The broker examines the terms and conditions of several options, and recommends an insurance policy that best suits the client’s needs at the best price.

Unlike captive and independent agents, who represent one or more insurance companies, a broker’s primary duty is to the client.

Since brokers don’t represent insurance companies, they can’t bind coverage on behalf of an insurer. They must hand over the account to an insurer or insurance agent to complete the transaction.

There are two main differences between insurance agents and brokers:

• Agents represent insurers, while brokers represent consumers.
• Agents can complete insurance sales (bind coverage), while brokers cannot.

Agents also receive appointments to represent one or more insurance companies, but brokers do not. An appointment is a contract an agent and insurer sign that outlines the products the agent can sell and for what commission rates.

Brokers, on the other hand, can solicit price quotes from multiple insurers. When consumers are ready to buy, they must obtain a binder directly from an insurance agent or the insurance company.

Like any small business, insurance agents and brokers both need business insurance to operate.

Insureon is both an agency and an insurance brokerage, with licensed professionals in every state. Our agents help small business owners with their coverage options, from among top carriers in the insurance industry, so they can find the right policies for their insurance needs.

Our insurance brokers help clients with finding coverage outside of standard insurance products, such as excess and surplus lines, from a variety of insurance underwriters. They can help in putting together an insurance program that fits your risk management needs.

A pioneer in insurance technology, Insureon operates the largest online marketplace for small business insurance in the United States. Our proprietary technology platform enables business owners to easily compare quotes and purchase the insurance policies they need. Start an application today to protect your business.