The Importance of Working With Independent Insurance Agents: Why You Need Their Expertise

Author:Shelden SmollanChief Experience Officer
Shawn Redford
Reviewed by:Shawn RedfordChief Business Development Officer
December 8, 2023
11 Minute Read

Learn how independent insurance agents can offer you more choices, better prices, and personalized service for your insurance needs.

An independent insurance agent waiting to help you

If you’re in the market for insurance, you may be deciding between a captive and an independent insurance agent. 

An agent who exclusively represents one insurance company and can only present their offerings to you is known as a captive agent.

An independent agent can provide you with a range of options as they work with multiple insurance firms.

This post will explain who independent insurance agents are and discuss the benefits of selecting one while purchasing insurance. You will find out why it makes sense to manage your insurance needs through an independent insurance agent.

What is an Independent Insurance Agent and How Do They Work?

An independent agent is someone who can help you get the best life insurance plans from many different insurance companies. They are not tied to any one company or insurance agency but work for themselves or have their own business. They have the license and skills to sell insurance, and they keep learning new things to stay updated.

A local independent insurance agent can show you many options for insurance, such as life insurance, auto insurance, home insurance, and business insurance. They can also find some unique or uncommon products that a captive agent may not offer. 

Definition of an Independent Insurance Agent

How Does an Independent Insurance Agent Work?

An independent insurance agent does not work for an insurance company but for you. As your personal advisor and advocate, they help you understand your coverage, answer your questions, and give you information that isn’t biased. Insurance agents can also help you with changes to your coverage, switching insurance carriers, billing, and claims.

An independent insurance agent can look at different plans from a variety of insurance companies to find you the best solution for your needs. They can get quotes from different insurance agencies and compare their prices, discounts, and features. You don’t have to do the searching yourself or choose from a small group.

Multiple wooden blocks each with a symbol representing a different kind of insurance being stacked into a pyramid by a hand

Why Should You Hire a Licensed Independent Insurance Agent?

When looking for insurance, you might be wondering if you should work with a captive agent or an independent agent. A single insurance company gives a captive agent its products to sell. An independent agent can give you a lot of choices because they work with many insurance firms.

Choosing an independent insurance agent has numerous advantages, including:

Multiple Insurance Carriers Available When Your Working With An Independent Insurance Agent 

You can often get the best insurance coverage and price from a variety of insurance providers if you work with independent agents. Their options are endless, and they can easily compare prices, deals, and benefits across many carriers. You aren’t limited to a small selection or forced to do the study yourself. Some niche or specialty insurance products may not be available from a captive agent, but an independent agent can help you find them.

An independent insurance agent can help you save money on your payments and give you more options. Their job is to find you the best deal with the insurance firms and the lowest prices from the numerous insurance companies. Additionally, independent insurance agents usually may assist you in combining your insurance so that you achieve even greater savings. Also, a local independent agent can look over your insurance policy on a regular basis and make changes to make sure you’re getting the best benefit.

Benefits of Using an Independent Insurance Agent: They Can Provide More Services

Your special advocate and advisor is an independent insurance agent. They do not work for a particular insurance agency but simply for you. They can clearly explain your benefits, answer your questions, and give you advice that isn’t biased. There is also help for making claims, billing, and changing policies. If you work with independent agents, the agent is your best source of information about the types of insurance available. The agent gets to know your wants and preferences and has a professional relationship with you.

Less Doubt: Independent Agent Work for You

Independent insurance agents are licensed professionals with a lot of experience who follow rules and ethical standards. It’s required that they keep up with training and education to keep their license. Additionally, they must follow a set of rules that safeguard your rights and interests. You can trust an independent agent to perform service in an honest and dependable manner.

Step-By-Step Guide To Becoming A Licensed Life Insurance Agent

How Do I Find a Local Independent Insurance Agent?

An independent insurance agent may be what you need to get your insurance in the United States. The Independent insurance agent can offer you quotes from multiple insurance agencies and help you choose the right insurance for your needs.

To find a local insurance agent and purchase life insurance, you can do the following:

  1. Seek advice from your family, friends, network, and workplace. Because they may have had positive experiences with local insurance brokers, they may be able to suggest them.
  2. Search the internet directories that associations and insurance agencies offer. You can usually find local agents online in these directories by using the search options that are tailored to your location.  Also search on Google or Bing search engines for “local independent insurance agent” or “life insurance agent near me”.
  3. Consult associations representing insurance agents, such as the National Association of Insurance Commissioners (NAIC). They include resources like the Life Insurance Policy Locator, which can assist you in locating policies and establishing connections with local agents. 
  4. Watch for seminars or activities related to insurance in your area. Insurance agents who can offer advice and information on buying life insurance frequently attend these events. 

Make sure prospective agents are licensed and have expertise selling life insurance by conducting in-depth research and interviewing them. To be sure they are trustworthy and dependable, it’s also a good idea to check their credentials and customer testimonials. 

The certified life and health insurance agent will assist you in comparing policies and choosing the right insurance coverage for your needs. Ask them to go over the benefits, drawbacks, expenses, and dangers of each policy. Find out about the application, delivery, service, and underwriting procedures from them. Make sure you are aware of all the terms and conditions before you sign.

The Best Paying Jobs in Life Insurance

Independent Insurance Agent vs Captive Insurance Agent: Which One is Better?

Captive and independent insurance agents are different types of professionals who can help you with your insurance needs. Independent agents work with multiple insurance companies and can offer you more choices and better prices. They are loyal to you and can give you unbiased advice and support. Conversely, captive agents work for one particular insurance company and can only sell the insurance products from the company they represent. They are loyal to the company and can give you a simpler and faster process. You should choose the type of agent that suits your preferences and needs. You can also compare both types of agents before making a decision.

Independent Insurance AgentCaptive Insurance Agent
Represents more than one insurance company and can offer multiple carrier and rate optionsRepresents only one insurance company so they have a limited product offering compared to independent agents
Works on behalf of the policyholders and can recommend the best insurance company for their needsWorks for the insurance company, so they are often not aware what other options are available
They cost less than captive agents, making them more affordable for most peopleWith less choice, consumers may end up paying more for their coverage than they might otherwise
Has more flexibility and freedom to choose the insurance products they sellHas more stability and support from the insurance company they work for
Has to generate their own leads and clients, but also has higher commission ratesHas to meet quotas set by the insurance company, but also receives leads and salary from the company
An independent insurance agent talking to a captive insurance agent over a desk

What is the Difference Between an Independent Insurance Agent and a Broker?

You might be wondering who can help you get the best insurance policy when you are shopping for insurance. Independent insurance agents and brokers are two types of licensed insurance professionals that you may have heard of. But what’s the difference, and how does it change the way you deal with insurance?

Insurance Agent

A person who works with more than one insurance company is called an independent insurance agent. They can give you a range of products and prices. They don’t work for any insurance company, so they can find you the best coverage and price with more freedom. Agents can often also give you advice and direction that isn’t biased because they care more about you than the insurance company.

Insurance Broker

A broker is someone who works for you and connects you with insurance agencies, agents, or underwriters. They are not tied to a single insurance agency, so they can look at many different insurance companies to find you the best deals. Aside from that, they can also bargain and help you with claims or disputes.  They may also charge you for their services in addition to receiving payment from the businesses.

  • While both independent agents and brokers assist customers in locating insurance plans and are able to sell insurance, there are a few key differences between the two. Brokers are limited to applying to the insurance firms and waiting for approval of your deal with the insurance company; independent agents are able to write and enforce insurance contracts on behalf of the insurance agencies they work with. This implies that brokers must rely on the judgments made by insurance carriers, but agents have greater power and freedom to obtain coverage for their clients.
  • Another distinction is that brokers have access to the whole insurance market and can locate the finest solutions for their clients, whereas independent agents usually work with fewer insurance agencies. Brokers may offer a greater range and selection of insurance policies, but independent agents may have greater expertise with the particular features and products of the firms they represent.
Insurance AgentInsurance Broker
Represents insurersRepresents consumers
Can bind coverageCannot bind coverage
Has contracts with specific carriersHas no contracts with specific carriers
Receives commission from insurersReceives commission from insurers and fees from consumers
Works with specific companiesWorks with a broad range of companies

Life Insurance Broker VS Agent

Which one do you think is better?

There is no clear answer to this question because it depends on what you want and need. But here are some things that might help you make up your mind:

If you want more personalized service and ease of use, you might choose work with an independent agent. Also, they can take care of all your insurance needs in one place, which will save you time and trouble.

What if you want more options, help, and support? A broker might be better for you. Agents who work on their own may not always be able to get quotes from as many insurance agencies and goods as brokers can. With what they know and have done, they can also get you the best deal. Also, if you have a problem or argument with the insurance agency, they can look out for your best interests.

You can choose between an independent agent and a broker based on what you need, what you want, how much money you have, and what you expect. It’s also a good idea to learn about the different kinds of benefits and ask them what they can do for you. This is how you can get the best insurance plan for your needs.

A Day In The Life Of An Insurance Agent

How Do I Know if an Insurance Agent is Qualified?

Search for an independent agent who possesses:

  • A license that is current in your state
  • A solid track record, testimonials, and reputation
  • A certification or professional title
  • A professional association or group membership
  • A focus on the specific kind of insurance you require

How Do I Pay an Independent Insurance Agent or Broker?

You are not required to pay an independent insurance agents or brokers directly. They are paid by the insurance firms they represent, typically in the form of a fixed fee or a percentage of the premium. The amount you pay for your policy is unaffected by their compensation.

However, some may charge you for their services, particularly those that offer extra products or services that aren’t included in the commission.  Before you sign any agreements, you should always ask about their pricing schedule and the services that are provided.

Can I Buy Insurance Directly from the Insurance Company?

You can sometimes buy insurance directly from the company, either online or over the phone. You might miss out on some of the benefits of working with a different insurance agent if you do this, though.

  • There may not be as many goods and features to choose from if you buy insurance from the company.
  • You might not get the best deals on insurance if you buy it from the company.
  • You might not get as much help and service one-on-one as you would from an agent. There may not be someone in your life who can help you with bills, claims, or insurance changes.

Independent Agent Careers

Experior Financial Group Logo

FAQ : Frequently Asked Questions About the Importance of Working with Independent Insurance Agents 

What is an independent insurance agent?

An independent insurance agent offers a range of products at reasonable prices because they work with many insurance firms. Since they don’t work for any one company, they can give you unbiased assistance based on your specific needs.

How does working with an independent insurance agent benefit me?

When you work with independent agents, you have more choices and can make sure that your coverage fits your needs. They can go through rates from multiple companies and find the best deal for you. They also speak up for you if you need to file a claim or have a disagreement with the insurance company.

What is a captive insurance agent?

An insurance agent who works only for one company is called a captive insurance agent. They only sell products made by their business and follow the rules set by their manager. 

Captive agents may show what other companies’ prices are, but they won’t be able to sell or give those policies. This is because they want to show that their business offers the best value and service to its clients. They might also want to teach their clients about the various types of insurance and perks that are out there. Captive agents unlike independent agents, might not have all the information and choices that independent agents do, and they might not be able to compare the prices and features of different insurances in a fair way. 

Why might I choose a captive agent over an independent agent?

A captive agent might be better for you if you want a straight-forward process with just one company. They can make it easy to get insurance from a single company, so you don’t have to check prices from different companies.

Can I work with both independent and captive agents?

You can work with both types of agents and look at their proposals side by side. With this information, you can choose the insurance plan that best meets your needs.

How do I decide between an independent or captive agent?

Before making a choice, think about your needs, finances, preferences, and expectations. To fully understand what each type of agent can offer, do your research and ask a lot of questions. So, you’ll be ready to choose the insurance plan that best meets your needs.

Shelden Smollan
Shelden Smollan, Experior Financial Group's Chief Experience Officer, has spent more than 45 years working in the fields of Life Insurance and finance. He is an excellent insurance sales and management executive with exceptional strategic thinking, marketing, and leadership abilities. He has been Experior Financial Group Inc.'s Chief Experience Officer for the past six years, and his vision and expertise have been instrumental in the company's growth and development. By arranging meetings between agents and carriers so that our team of associates can learn from them and draw inspiration from them, he has assisted our IMO in expanding.