Understanding insurance can be a bit of a minefield, but finding the right agent can help you safely navigate through the complicated world of insurance and ensure that you get the best deal. The key decision comes down to choosing the best insurance agent who can provide you with the services you need. There are primarily two types of insurance agents: captive and independent. Both have the same goal of providing you with quality insurance coverage, but it is important to be aware of their notable differences.
Independent agents are not tied to any individual insurance company and work directly for the customer. So, this means that they have the ability to sell you insurance from multiple companies depending on your needs. For example, ABCInsurance might sell insurance for 123Auto, XYZAuto, and A1Homeowners. This gives you, as the buyer, more options in finding a policy that fits you because you can look at three or four different companies through one agent. Because they sell policies from multiple companies, Independent agents have the ability to compare prices and services among different insurers to find the best product for their customers.
A captive agent is held “captive” by one specific insurance company. They are not necessarily employed by that company, but they have entered into a contract with that insurance company and can only offer products and services from that company. For example, ABCInsurance is an insurance agency who can only sells policies for 123Auto so their sole purpose is to solicit business for 123Auto. Because they can only sell policies from one company, Captive agents are limited in what they can sell.
There are pros and cons to both of these options. While an independent agent might be able to offer you a wide range of options and can compare quotes from their various carriers to get you the best deal, but you might not be familiar with the companies they represent. A captive agent can only offer you plans from one company, but he will be an expert on what that company has to offer and will have a close relationship with that carrier. Both agents, regardless of their status will be licensed by the state to sell insurance and will do their best to find the coverage and price that make you, the customer, feel the most comfortable.
The most important aspect in choosing an insurance agent is to find a well-rounded professional who you feel comfortable working with on a long-term basis. They should be knowledgeable, understanding and respectful of your needs as well as provide you with affordable insurance options.