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What is a Car Insurance Broker?

Picture this. You spot some policies online, compare their rates, and pick one that fits your bill. But, did you read and understand the rules for each plan? Indeed, this nitty-gritty matters in the long run. Then, why not leave it to the experts? Engage a car insurance broker. Huh?

The Definition

A car insurance broker is a person or entity that links you, the car owner, with many insurance companies. Why so? Well, by doing so, your broker gets you the best coverage that safeguards your interests.

Insurance Agent vs. Insurance Broker

An insurance agent represents the seller. Here, the agent sales policies on behalf of insurance companies. In contrast, a broker represents the buyer, getting the best insurance packages for his clients. 

Scope of Work

First, the auto insurance broker must survey the market and assess what products are on offer. Then, he gets quotes from select insurance companies with the best offers. Last, he presents the best options to his client, highlighting the benefits of each.

Other Services 

For a full package experience, the broker also provides the following services:

  • Risk assessment
  • General consultations
  • Collection of premiums
  • Research on the legal and regulatory framework
  • Renewing or amending policies on behalf of clients
  • Claims assistance
  • General administrative duties

Regulation

Each car insurance broker has to follow their local state regulations. Indeed, the broker must first get a valid license before indulging in any brokerage work.

Why Should You Work with a Car Insurance Broker?

Simplicity

Note that you don’t have to handle any legal jargon. To your broker will read and explain all the legal terms to you. That way, you can proceed to make an informed decision.

Matching Needs with the Right Products

Your broker must assess your needs before sourcing the right policy for you. Hence, you reduce the chances of claims rejection when an accident occurs.

Savings on Insurance Costs

Did you know that your credit score will dictate your insurance rate? Plus, stopping a payment as you switch from one insurance company to the other is costly in the long run? Yet, a broker will consider all this and more, and propose the best package for you.

Stretch Your Limits

Most auto insurance brokers have up to date details about the market. Hence, they will combine this data with their expertise to arrange the final quotes. This way, you tap into the latest technologies and trends at a fair rate.

Conclusion 

Finally, be cautious. Remember, all car insurance brokers earn on a commission basis. Hence, some rogue brokers may want to sell your expensive policies with optional benefits. The bottom line is, let your needs guide you. It is the only way you can avoid such “bells and whistles.”

Updated on April 11, 2020

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