Join Date: Feb 2010
Location: Narragansett Bay
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Re: Learned something about insurance premiums
The term Broker and Agent are often used interchangeably, but are very different. A broker is a salesperson that brokers a contract between a carrier and customer. They have no legal authority to act on behalf of the carrier. An agent, is an agent of the carrier. If the agent makes a commitment, they are making it on behalf of the carrier, such as when binding coverage. You are insured from that moment. A broker has to wait for the carrier to bind coverage and the carrier can change anything the broker told you.
Semantics to some. Whichever you prefer, it often comes down to the person and how many carriers they represent in either form. I am a big fan of using a local independent agent who represents several carriers that specialize in whatever I'm insuring. They should be able to get you good competitive prices, but more importantly, advise on the difference. Most often, the lowest price has coverage exclusions that others don't or are the most difficult to get to pay a claim.
Most insurance is simply sold on price, while a smart consumer would focus on value. For example, I don't have the rock bottom premium I could find, I have all the coverages, such as hurricane hauling, that I want.
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