How to Pick Good Independent Insurance Agents and Brokers

Independent insurance brokers usually represent a few insurance companies and sell the products that are most suitable for the needs of their clients. The average agent may quote over a dozen companies when creating a quote. Independent brokers are just as well trained and knowledgeable about the ins- and outs- of the insurance market as well as related laws. Their vast knowledge permits them to offer sound advice to their clients as it relates to the right amount of insurance and insurance coverage.

Sometimes people think independent agents are not as good as the name brands that spend millions or billions on advertising and branding. Selling fake policies or pocketing policy holders’ premiums are just a couple of routine insurance frauds. It doesn’t happen often – but, you want to be aware.  If you are grossly unaware then it’s easy to fall victim. In addition, more than half of the insurance brokers in bigger cities alone are independent. That means, they are not regularly audited or reviewed by the companies whose products they sell. Not to mention that state regulators do not have the resources to go after the ones that are less obvious.  Many former captive agents have left to become independent to be able offer more choices and be more competitive.

If you are looking for an independent insurance broker in your city, keep in mind that independent brokers do not guarantee the lowest premiums available even though they have access to a lot of rates. You create better odds for yourself when utilizing the services of an independent insurance broker but you still have to be cognizant of making comparisons yourself.

Finding a smart, conscientious and reliable independent insurance broker in you city is not difficult. They can offer value. However, finding a bad agent can reduce your wealth just the same. There have been news about scams in the insurance industry and so as an empowered consumer, there are things you can do to protect yourself and your wealth.

1. Don’t buy investments from someone who isn’t licensed to sell them. Your agent should at least have securities licenses if he or she is selling anything but insurance.

2. Your state insurance and securities regulators can be helpful. Describe the investment to them and ask if they have heard of it. They may not be privy to each new scam but at least you can prevent yourself from being duped by one that’s been around for a long time.  Look at the ratings.  You may be surprised to learn some of the big name companies like State Farm actually don’t have the best ratings.  Many companies represent by independent Insurance agents and brokers have some of the best ratings.

3. Ask what the agent will get paid, and how that compensation compares to the other products he/she sells. A reputable agent will not curtail the topic of commissions. They do give some idea of how much they will earn on a sale. If not, then this could be a warning sign.  It actually doesn’t cost any more to use an agent. A good agent may actually save you more.

4. Look for years of experience.  The best ones will usually have been in the business over five years.   There is a lot of turn over with new agents – most don’t make it.  The experienced agents usually gravitate towards commercial insurance as it pays better.  So, finding an experienced agent can be a challenge.  Avoid anyone who has not been in the business at least two years. Agents who have been around 10 years or more will most likely have built good reputations and have designations like CPCU or CLU. Which siginifies further schooling.  Creating this kind of reputation takes time and effort. In addition, an established agent will less likely risk his good name. While this is not a guarantee of integrity, it does reduce your chances of financial harm as a newbie won’t have much to lose.

These are just a few pointers when looking for an independent insurance broker. Even if you will not fall prey to scams, you can still watch out for the people in your life especially elderly relatives who have close relationships with their agents.