The difference between an established insurance company and a newly opened brokerage may have valued effect on your decision of which to issue a policy with. When comparing brokers to agents, typically agents hold the higher merit because that specific agent represents the name of the company he or she works for. Though, insurance brokers are slowly coming to rise now of days, and continue to have a steady grip on business in the insurance industry.

Brokers will always have a little bit of edginess to them as they are always independent. Brokers work for themselves and write the script for how they want their office ran and who will be the chosen ones to do it. Most people go with the broker over the big name company because they are either tired of the poor service, or want a fresh start as far as discounts and pricing goes.

Big name insurance companies will most of the time not have that personal touch or caring that a broker can provide. Brokers are completely freelance and make their own decisions on claims, underwriting, and who they will and will not provide coverage for.

Underwriting- This is one of the ways that insurance can make a lot of money. Underwriting is simply the allowed risk that can be taken by the insurance company or broker in regards to the amount of coverage needed to be given. The higher the risk, the less chance a big name insurance company will provide coverage. Risks for different companies may be different or more depending on the area in which the company runs their business and the rules by which they stand. Certain risks are some of the following:

-Brush

-Fire Hazard Area

-Flood Hazard Area

Brokers have the ability to pass off some underwriting problems and have them fixed by other underwriting brokerages. Big name insurance companies that you hear about on television and the radio always have a procedure to follow when a problem arises with underwriting or claims.

Claims- When it comes down to a time where you need help from your insurance provider because of an accident, will they be there? Filing a claim can be a hard time to go through depending on the stress the insured may be feeling do to the seriousness of the claim.  Insurance companies have a claims department and you will be transferred right over as soon as you call in and let them know it is a claim you need help with. It helps to know that you know what you are getting when you issue a policy with a big name company. Some brokers may not have the right service when it comes to claims because they are so quick to want and pass it off to someone else to take care of it.

There is a sense of security and foundation when issuing a policy with a big name insurance company. Some people would rather have the independence and freeness that only a broker could provide. It breaks down into rating risk. Will you be happy with either a company or a brokerage?

Yes, though the key part of deciding between the two is to rate the risks of each choice. Will the stability of the big name insurance companies hold you down and keep you stuck in their stronghold of your policy? Or will a broker’s freeness liberate you to a point where you feel you need a more established company backing you. In the end the choice is yours, so rate your risks, and make the decision and know your reasons why. It will be your policy that is issued, and your family that needs the coverage so choose wisely.

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