Consumers often times are unaware that there are two different types of insurance agents. Believe it or not, but the type of agent you choose can have a large impact on your wallet. It may be advantageous for you to ask your agent if they are independent or captive.
Independent agents are just what the word describes them to be. They are independent from carriers, which means they can be appointed with multiple carriers all under the same roof. A captive agent is stuck with one carrier, and they work directly for the carrier.
An Independent agent has the ability to market coverage through a network of carriers and find the best overall package and premium for the consumer. They have the ability to re-market every year as carrier rate filings change to ensure the consumer continuously gets the best rate, year in and year out. There are no fees for their services. On the other hand, a captive agent does not have the ability to market coverage to multiple carriers if the consumer’s rates increase. Often times they will lead the consumer to believe they are still getting a good deal with the carrier, even though it may not be true.
Consumers needs vary tremendously from one person, or business, to the next. And similarly, carriers polices are vastly different. For one carrier to provide a general policy that will suit the needs of every consumer would be nearly impossible. In order for carriers to be competitive they need to specialize in certain types of risks (location, industry, claim history, driving record, ect.). The independent agent can shop through their network to find the best possible policy for their consumer’s needs, and give them the most value for their dollar. A captive agent is unable to provide these types of services.
In addition, an independent agent is typically unbiased to any one company, since they have a network of carriers to choose from. Whereas a captive agent only has one product option, which in turn gives the consumer only one option.
If you would like more information on the differences between an independent agent and a captive agent please contact our Carlsbad Insurance Office at firstname.lastname@example.org or call at (760)795-2002.