Making the Best Use of an Independent Insurance Broker

While many people obtain insurance directly from a large insurance company, it's often wise to use the services of an insurance broker (or an independent insurance agent). In every county, there are a number of insurance firms, and while the quality of such agents varies from firm to firm, most of them have high integrity and can help you shop around for the best policies at the best rates. In fact, many of these agents will review your existing policies--free of charge. Many of my clients have gotten better deals by having an independent agent review their policies. And if they can't find a better deal, they'll let you know that your policies are well-priced. More importantly, they can help spot areas where you are under-insured. 

I recommend insurance brokers for  P&C (property and casualty) insurance, which includes car insurance, homeowners insurance, travel insurance, umbrella insurance and business insurance. For my clients that are shopping for life and long-term care insurance, I work with a specialized agent that works strictly with fee-only planners and their clients. There are also health insurance brokers, but for most of my clients, state-based insurance marketplaces meet their needs. A growing number of younger people prefer to buy insurance online, using sites like PolicyGenius. 

To enhance your own knowledge around insurance coverage bets practices, you can check out the wealth of information available at the Insurance Information Institute. 

Perhaps the most important reason to consider an independent insurance agent: They'll be your advocate when it comes time to make a claim, or if you have an accident of any sort. 

Even if you don't work with an agent to review and compare policies, you should take the time to do so yourself. I like to get multiple quotes from different insurers to compare and contrast the policy options. A recent study by ValuePenguin (a division of LendingTree) found that "44% of consumers with homeowners or renters insurance and 39% with auto insurance didn’t compare multiple quotes during their most recent renewal."

Know that insurance companies give appealing policy quotes for new customers, then stealthily jack up their premiums over the years, assuming people won't notice the size of their premiums from year to year. That same study found that 43% of people that shopped around found better deals (which I define as more coverage for the same premium, or the same coverage for a smaller premium). 

Looking for a recommendation in your area?  It's best to ask friends and relatives if they use an agent they like and trust.