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

In Rhode Island, the terms insurance agent and broker are often used interchangeably. However, there are some differences between an insurance agent and a broker. An insurance agent is an individual employed by an insurance company to sell its products and services in Rhode Island. The insurance company pays the agent a commission for each policy sold. The agent is paid by the insurance company for each sale and does not receive any payment from the buyer. An insurance broker, however, is an independent contractor. Brokers are not employed by any one insurance company but instead work to find the best coverage for their client at the lowest cost. The broker is paid by the buyer for the service they provide. The primary difference between an insurance agent and a broker is who pays them. Insurance agents are paid commissions by the insurance company they represent for each sale. Insurance brokers are paid by the buyer for helping them to find the best coverage for their specific situation.

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

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