Auto Insurance Brokers
We all know shopping for auto insurance is not fun. It can be very time consuming and quite honestly a hassle. This is where an auto insurance broker can come in handy because they can do a lot of the shopping for you. You do not necessarily need an auto insurance broker to find the best policy for you. Car insurance is more straightforward and can be purchased by the consumer online. But shopping car insurance with a broker can be much more convenient. We hope to explain to you what an auto insurance broker is and how they can help you find cheap auto insurance. We have found if you have claims history or hard to place insurance brokers can be a great fit for you.
Different ways you can buy auto insurance
Before we dive in too deep on auto insurance brokers we want to explain the different ways to purchase auto insurance.
1. Buy insurance directly from the carrier- This is becoming a very popular way of purchasing auto insurance. This is where you skip over the agency or middleman and go directly to the insurance company. This can be cheaper in some cases because you bypass the middleman fees the insurance company pays the brokers. Here are some examples of a direct writer that you can purchase insurance from:
- Save Money Car Insurance
- Fred Loya
2. Buy insurance from a captive agent- This is an insurance agent or agency that sells insurance exclusively through one company. This is in most times some of the big national brands. Here are a few captive auto insurance companies we found:
- State Farm
- Farm Bureau
- American National
3. Buy insurance from a broker- There are many different kinds of brokers whether it be auto insurance, home insurance, health insurance, or life insurance. Brokers work with numerous companies and usually sell many kinds of products.
Why should I use an auto insurance broker?
Auto Insurance brokers are similar to a personal shopper. They try to find out your auto insurance needs and place you with the best company that fits those needs and your budge. Good brokers really make sure their customers receive the best experience possible. They save you time and energy by doing the
work of getting quotes for you. They can also shop your rates every renewal to make sure your current company is still the best fit for you. They can help go over each part of the auto policy with you so you truly understand what you are paying for. This can make you rest assured that you are adequately covered.
What is an auto insurance broker?
An auto insurance broker is a specific type of auto insurance agent or agency. An auto insurance broker acts as a middleman between the customer and the insurance carrier. There is typically a fee involved for their services. Brokers are paid a commission for each sale they get for the insurance company. They work on the customers behalf as opposed to a specific carrier. A car insurance broker can help you understand your auto insurance needs and factors that can help or hurt your auto insurance rates. An insurance broker has to be licensed by the state they transact business in.
Pros and Cons of using an auto insurance broker
There pros and cons of using an auto insurance broker. We hope to give you enough info so you can make an educated decision on whether an auto insurance broker is good for you. Here are some pros that we have found regarding using an auto insurance broker:
- Customer will receive the best price in most cases because auto insurance brokers are contracted with numerous insurance companies. So, in essence the more quotes you get from different insurance companies the better your chances are of getting cheap quotes.
- They take the hassle out of getting auto insurance quotes. Some brokers can get you quotes from 50 different auto insurance companies with one call.
- Brokers usually have experience and knowledge that a normal consumer may not as far as what is covered on the auto insurance policy. Some coverages can be complicated and some terms need to be explained to customers.
- Brokers watch out for their customers and make sure their policy is covered properly and all their insurance needs are met.
- Brokers are independent and not controlled by one insurance company. This allows them to move shop your policy around on a frequent basis to make sure you still have the best rate.
- Here are some cons to using an auto insurance broker:
- Brokers do work on a commission basis usually 15-20 percent of the premiums collected they are paid. So, they don't have allegiance to any certain company but sometimes could be tempted to sell a higher policy to get more commission.
- Brokers can charge extra fees that you may not pay when you use a company directly.
- Auto insurance comparison websites can help you get a similar result as getting quotes from a broker.
- Claims service can potentially not be as good due to the broker having no authority to assist in a claim's scenario. Claims would be handled directly with the carrier
Auto Insurance Brokers: FAQ’s
What does an auto insurance broker do?
Auto insurance brokers help customers find the cheapest auto insurance rates while searching through numerous companies. The more quotes you get increase your chances of saving money on your rates.
How do I become an auto insurance broker?
There are a few steps to become an auto insurance broker. First you need to contact your state department of insurance and sign up to take the state license exam. Some states you will be required to take classes before you take the test. Once you pass your test you will get a copy of your license in the mail. Then you can contact independent auto insurance companies and ask to be contracted with them once you get your auto insurance name and license established.
Are auto insurance rates cheaper through a broker?
Not necessarily, but it increases your chances to save money due to the broker getting so many quotes from different companies for you in one phone call. The more quotes you get the better.
How do I find an auto insurance broker?
The best way we have found to find a broker near you is search on google under the term auto insurance broker.
Is it better to buy insurance from a broker?
No, it is not better to buy insurance from a broker. It just allows you to get lots of quotes from one call.
How much do car insurance brokers charge?
The average commission for a broker is 15% and the broker fee is between $25-$50.
Who pays an auto insurance broker?
The insurance company they are partnered with will pay them their commissions.
Concluding thoughts on auto insurance brokers
Just like anything there are good and bad things about working with an auto insurance broker. For many years this has been a primary way people have searched auto insurance. Over the past few years many direct writers have come in to the market and have taken market share from the auto insurance brokers. People are really starting to purchase online auto insurance and bypassing the brokers altogether. We expect this trend to continue. But here at Cheapest Auto Insurance we offer the best of both worlds. We are an auto insurance broker but also a direct writer with our company as well. Call or text one of our agents for a free quote at 918-744-5145.