What is the difference between an insurance agent and a broker?

An insurance agent and a broker are two distinct, legally defined roles in the insurance industry in Maryland. An insurance agent is an individual who is authorized to act on behalf of an insurance company to market, sell, and service insurance policies. Insurance agents can also give advice and assistance to customers in the selection of suitable insurance coverage. Agents can be independent, meaning they represent multiple insurers, or they may be exclusive, representing only one insurer. Insurance brokers are typically independent agents, representing the interests of policy owners rather than insurers. Insurance brokers provide advice and assistance to customers in their selection of insurance coverage. Additionally, they negotiate on behalf of the policyholder to obtain competitive rates and terms from insurance companies. Brokers also advise customers about the suitability of various policies available, assist with the claims process, and provide renewal and other services. The main difference between the two is that agents work for the insurance companies, whereas brokers are independent, working for the policyholders. Agents are compensated by the insurance companies via commissions, whereas brokers are typically compensated through fees paid by the policyholders. Both agents and brokers can help individuals and businesses find the right insurance coverage for their particular needs, but brokers are better positioned to represent policyholders in the event of a dispute or other insurance-related issue.

Related FAQs

What is the standard of care for an insurance company?
What are the different types of insurance policies?
How does the law protect insurance policyholders?
How do I dispute an insurance claim denial?
What is the difference between term and permanent life insurance?
What is the role of an insurance actuary?
What rights do insurance policyholders have?
What type of coverage is included in auto insurance policies?
What is the process for settling an insurance claim?
What does the term “bad faith” mean in an insurance dispute?

Related Blog Posts

Understanding the Basics of Insurance Law - July 31, 2023
Know Your Rights: Navigating Insurance Disputes - August 7, 2023
Tips for Making Insurance Claims After an Accident - August 14, 2023
Common Types of Insurance Contracts Explained - August 21, 2023
Underinsured Motorist Claims: When to Seek Legal Representation - August 28, 2023