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What Is an Insurance Broker?

May 29, 2024 in

Insurance is a contract with which a policyholder receives financial protection or reimbursement against losses from the insurance company. Most people have insurance, like life, car, home, or health insurance. In the complex insurance world, one role attracts the clients’ attention - insurance broker. But what is an insurance broker, and what does an insurance broker do for you?

In this article, you can learn the responsibilities of an insurance broker, the benefits of using their services, and the types of insurance brokers available. Let’s start!

What Is an Insurance Broker?

Insurance brokers provide the right insurance covers for organizations and private clients. Simply put, insurance brokers connect insurance companies and clients in order to provide clients with the best deals.

As an insurance broker you can work in retail insurance or commercial insurance. You will deal with travel, property, motor, and pet insurance covers in retail insurance. While in commercial insurance, you should handle more complex areas, like aviation, marine, and oil and gas.

You can take a look at the insurance jobs Tucson AZ, to see what the market needs. But what is the purpose of an insurance broker? The usual services provided by insurance brokers are the following:

• Helping clients understand their current insurance needs
• Building business relationships with clients
• Attending meetings
• Researching insurance policies
• Negotiating policy terms and costs with insurance providers
• Explaining policies to clients
• Advising clients on making claims to their policies
• Renewing or amending existing policies for clients
• Collecting insurance premiums
• Keeping detailed computer records

However, what differentiates insurance agents and brokers is that agents represent insurers, while brokers represent clients. So, brokers offer policies from different companies, and agents should sell policies from one or more insurance providers they represent. In simple terms, brokers are advisors because they represent the client’s best interests.

Responsibilities of an Insurance Broker

Insurance brokers’ main responsibility is to help clients understand the insurance world. Having this job title requires providing individuals and businesses with suitable and cost-effective coverage.

So, what does an insurance broker do? Here are some specific responsibilities of an insurance broker:

Assessing client needs and risks to determine appropriate insurance coverage

Your job is to meet with clients to collect their personal or business data, like their assets and liabilities. Based on that, you should analyze their insurance needs and decide what type to suggest.

Researching and comparing insurance policies from multiple insurers

It is your duty to research and analyze insurance policies from different insurers. Once you go through each company's coverage terms, conditions, and premiums, you should compare them. Only this way can you offer clients the best deal that meets their needs.

Providing advice and recommendations

Using your knowledge and experience, you can easily explain the insurance options to your clients. Remember to make clear what are their benefits and drawbacks. Finally, you should help your clients decide based on their goals and budget.

Assisting with policy selection, negotiation, and purchasing

First, you should help your clients make the right decision in selecting the best policy. Once they decide, you should assist them with paperwork and negotiate the terms and costs.

Serving as an advocate in claims processing

In the event of a loss or damage covered by the policy, it is your duty to assist clients in reporting their claims and collecting all the necessary documentation. You have to provide a fair and timely settlement.

Qualifications and Licensing

The US does not require formal education for insurance brokers. Yet, keep in mind that while a high-school diploma and on-the-job training may be enough for some companies, others require a Bachelor’s degree in finance or business.

When it comes to licensing requirements, the state of Arizona requires passing a state licensing exam. Once you pass this exam, you can apply for an insurance license.

Ongoing training and professional development are fundamental for insurance brokers to stay updated with industry trends. It helps brokers improve their knowledge and skills to provide the best service professionally.

Types of Insurance Brokers

Independent insurance brokers

Independent brokerages are not connected to insurance companies. They can recommend to clients any product on the market that is in their best interest.

Independent brokers can provide honest advice to clients in order to help them choose the best coverage. They offer clients many plans to find the best option and negotiate the price.

Captive insurance brokers affiliated with specific insurance companies

Captive insurance brokers are associated with specific insurance companies and have contracts that oblige them to sell their products. This type of broker knows everything about the specific products they sell, and they offer options from the company they represent.

Specialized brokerage firms

Some brokerage firms specialize in certain types of insurance, like health or life insurance. Normally, brokers who work for these firms are experts in those fields and can assist clients seeking these insurance types.

Benefits of Using an Insurance Broker

Clients have many benefits of using an insurance broker. As a broker, you will help clients save effort and time. Clients know that brokers are aware of what the best insurance products on the market are. Moreover, brokers help clients manage risks.

Now, several important benefits of using an insurance broker are worth discussing. Some of them are the following:

Access to a wide range of insurance products and providers

Insurance brokers have access to many insurance companies. That is why they can offer many options to their clients. This means that, as a broker, you can find the best policy for your client.

Expertise and industry knowledge

The insurance industry can be complex, with many professional terms unknown to clients and long contracts with terms and conditions. That is why clients need brokers to help them navigate through the insurance process. Your experience and knowledge can help you explain complex policies with simple words.

Personalized service and tailored insurance solutions

The fact that insurance brokers provide tailored services eases the insurance procedure for clients. As an insurance broker, you should pay attention to each client’s needs, circumstances, and risks.

Assistance with claims handling and advocacy

In the case of claims, brokers are clients’ advocates. In these situations, you have to assist clients in the claim processing and represent clients with their insurance company. In case of disputes, brokers also provide advice and support.

Enter the Insurance World With Afni

So, what is an insurance broker? It is an intermediary that provides the right insurance coverage for organizations and private clients.

Insurance is one of those secure industries offering many career options and competitive salaries. We understand that looking for your insurance dream job by yourself may be exhausting, so we want to help you and ensure you find what you want

Now that you know what an insurance broker is, you can dive into the brokerage world and assist clients in finding the coverage that suits their needs. Afni can help you find a job that makes you excel, grow professionally, and earn a good living. So, visit us to learn more about insurance jobs in your city!

About the Author

Samantha is the Recruitment Marketing Manager for Afni and brings a wealth of knowledge and tips for job seekers. She holds a bachelor's degree in public relations and marketing from Mount Saint Vincent University as well as a masters degree in digital marketing and advertising from Liberty University.