An insurance agency, sometimes also known as an insurance broker or independent broker, brokers, and collects policies from a variety of insurance providers. Generally they are not connected to any one insurance company. They receive commissions for the policies that they sell, but do not represent any specific company. This is why some people may mistakenly think that the insurance agent or broker is selling them an insurance policy when in reality the individual is being given a quote or an idea of what the price or monthly premium will be for a policy. This is why it is important to have a variety of insurance agents or brokers on your insurance policy or list. Do you want to learn more? Click Howell Insurance Agency Association.
There are many reasons why an insurance agency may be established. Some people open their own insurance brokerage business without any connections or experience, believing that they can “go it alone” and not deal with many different insurance companies, or not have to change vendors on a regular basis. While running your own business can be very successful and allow you to have more control over your policies, the fact is that you must still rely on referrals and customers to buy your products. In order to get new clients or customers, an insurance brokerage firm must maintain a strong and consistent marketing program.
Many times insurance agents and brokers start out working independently and decide to open an agency. Then they receive commissions from many different companies for the policies that they sell. This means that each time the agent or broker sells a policy the company they represent receives a portion of the commission. Insurance commissions vary from company to company. For example, an insurance company that pays a commission of 10 percent to the agent may pay a higher amount to the broker who represents them exclusively.