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Insurance Brokerage Intern’s Diary: What do Insurance Brokers Actually Offer?

Source: Erik. K
August 26th, 2016

Do you consider insurance to be mystifying yet unavoidable part of life? Does an insurance policy look like some kind of alien scripture to you? Or have you been told insurance is a scam to part you from your hard-earned cash? If you find yourself agreeing to some or all the questions, then don’t worry you are not alone.

May I first introduce myself; yours truly is your everyday student bathing in the joyous and relatively carefree cradle of university. However, with the daunting prospect of graduating, finding my career and hopefully functioning as an independent adult looming around the corner; one has to think about some essential yet previously ignored part of life. Coincidentally, I have entered an insurance broking company as a summer intern and with all the questions and/or misconceptions about the industry in mind, I seized the opportunity to clear my queries and summarized my experience into short pieces which would hopefully be of use to you, my reader.

The first nugget of information I would like to share is related to the first point of contact when choosing any insurance, the insurance intermediary. Some eagle eyed readers might have spotted that the writer is interning at an insurance broking company and wondered “What is the deal with an insurance broking company, isn’t insurance sold by agents?” and you would be right about the two types of insurance intermediary. Both are professional and qualified persons or organizations seeking the perfect policy for their customer’s need. The difference between the two is who the intermediary represents; where companies are represented by agents, brokers represent the interest of the customer.

“What difference does it make?” you might ask yourself.


“Would companies provide their agents with better polices?” The answer would be NO. It is in insurance companies’ interest to sell as many policies as possible, therefore they could offer brokers equal if not more competitive product premiums to brokers, in order to stand out from the rest of the offerings in the market. In addition brokers will have knowledge of the different policies and prices offered in the market and be able to help you compare insurance product A from B.


When you buy from an agent representing just one company, or just a small handful of companies, you become restricted to the products provided by the small pool of insurance companies which they represent. Although the agent might try their best to provide options from their limited selection of insurance providers, unfortunately they will always be restricted in what they can propose to a potential client and may be unable to properly fulfill your needs.

In contrast, a broker is not bound to solely offer the products offered by just one company or a limited number of companies. She or he can seek out product offerings from a wide range of insurance providers so as to find the one policy that truly fits your needs.


Additionally, returning customers are the lifeline of any insurance brokerage and it is in their interest to assist their clients with all their insurance needs, including in guiding them through the claims process, in the case that they need to make an insurance claim.


Furthermore, since brokers represent a number of clients, they find themselves in a position which enables greater (effectively collective) bargaining power when dealing with insurance companies. This is an added benefit that clients often overlook; that is when purchasing through an agent, one becomes a direct client of the insurance company, while when you purchase through a broker you become a client of that broker along with all the other clients of that broker and insurance companies recognize and respect this fact.