How to Select an Auto Insurance Broker
Every state requires that you have at least liability (and sometimes full coverage) insurance coverage on your car. With the cost of auto insurance these days, it is hard to know if there is an insurance agent or insurance broker that you can trust. This guide will give you the lowdown on what to look for when shopping around for auto insurance quotes.
An auto insurance agent may be new to the insurance game. When you first get your license to sell insurance, it is usually as an agent. Later on, with experience and more classes, an insurance agent can become a broker, which will be discussed in the next section.
Auto insurance agents perform all the standard functions that you would expect from someone who sells insurance. They will give you car insurance rates in the form of a car insurance quote; they can sell you a policy and update the policy, and they will be also be the first person that you call should you have to invoke your policy for any reason (such as a traffic or parking ticket, accident, etc.).
An auto insurance agent writes a policy on behalf of the company they work for, the one who is doing the insuring. This is what differentiates them from a broker, who is writing the policy for the people they are actually insuring.
An auto insurance broker differs from an auto insurance agent in several ways. Exactly how much they differ depends on which state you happen to live in. While an auto insurance agent will write a policy for a customer on behalf of a broker, the broker will simply write a policy on behalf of the customer.
In other words, a broker is allowed to have agents working under them, and frequently, they will have their own auto insurance policy business. They are also more heavily regulated than an auto insurance agent would be, since they have a lot more responsibility than a mere agent.
There are a lot of people who are just starting out in the world of insurance agents. This does not necessarily mean weakness! Most agents work under one or more insurance brokers who have likely been in the business for a very long time. So, even if your potential insurance agent is wet behind the ears, he or she may still have vast amounts of experience and knowledge behind them to rely upon at all times.
It is advisable to either seek out an experienced agent, or one who works under an experienced agent. It is not hard at all to find out how much experience a broker or agency has; all you have to do is ask! In fact, many agents advertise how long they have been in business, simply because it is a sign of strength and knowledge.
This is the fun part of shopping for auto insurance—finding the insurance agent or insurance broker. In years past, you would have to literally call every agent in the phone book to get a quote, often with them urging you to fill out a form and pressuring you to sign on the dotted line.
In today's Internet-savvy world, the work is much easier. There are many websites where you can get car insurance rates in seconds, often from several companies all at once. You simply input a few pieces of information, and in a snap, you have several auto insurance quotes at your fingertips.
The beauty of this type of system is that it not only saves you a ton of time, but it allows insurers to compete for your business, meaning you are sure to get the lowest rate possible for your auto insurance rates. You can even leave your phone number or e-mail and request additional quotes or help from an insurance agent or broker.
The rate that you are quoted by an insurance agent is likely the biggest key to whom you choose for your auto insurance needs. Everyone wants to save money, so many go automatically with the lowest quote.
You should carefully consider all quotes, even ones that may seem a little higher than you would like to pay. The reason for this is because often, smaller monthly or quarterly premiums mean higher deductibles, should you get into an accident. You may be saving money now, but if you have to ever use your insurance for repairs, you will be paying a lot more at that time. It may be beneficial for you to pay a little more now and save yourself from a high deductible later.
Insurance agents work off of commission, so of course they want to sell you a policy. Many use selling tactics that any good salesman would use, but some cross the line and become exceedingly pushy. They may try to goad you into signing a contract, even if you are not sure. Or, they may try to add on several extras to the policy that you may or may not need.
Since this is your money, you need to take control of the situation. While some add-ons, such as vehicle rental insurance, may be a good thing (this enables you to get a free rental car while your vehicle is being repaired) for those who only have one car, it may be wasted money for a person or family who has multiple vehicles. Don't ever let an insurance broker pressure you into something you don't want or need.
Often, an insurance agent will be able to sell you more than one type of policy. For instance, you may be able to get homeowner's or renter's insurance from the same person that you got your car insurance quote from.
If this is the case, see if there is a discount available for multiple policies. You may be surprised at how much you can save when policies are combined and discounted. If this particular insurance agent can't sell you multiple policies, ask them for a referral instead. They often know the best deals, even if it is for a type of insurance that they don't sell.
Even if the insurance agent you are going with works for someone with a good reputation, you may still want to check things out. A simple Internet search or a call to the BBB (Better Business Bureau) will tell you if this particular agency or insurance broker is in good standing.
If there are complaints on record about them, you may want to reconsider signing on for a policy with them. Even if they offer the lowest, rock-bottom car insurance rates, if you can't recoup the money later, it really makes no difference. Make sure your agent is staying on the right side of the law and isn't trying to sell you something that is either wrong for you or wrong in the eyes of the law, as well.
Choosing an auto insurance broker is much easier today with the Internet, since many insurance agents can contact you at once with car insurance quotes. There are a few things you should look out for, though. First, never let an insurance agent pressure you into buying anything; make sure they work for a reputable company and always do your research. You should also check to see if they have discounts for multiple policies and what other products they may be able to offer you to save money.