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What is a Car Insurance Broker?

Amy Danise

A car insurance broker is someone who can sell you insurance from multiple companies. If you want to comparison shop for auto insurance, an insurance broker can shop the market for you to find the best car insurance quotes.

An insurance agent does a similar job but usually works for just one company. Some auto insurance companies, such as Allstate, only sell through their own insurance agents.

A car insurance broker or agent does not decide how much you’ll pay (that’s what the insurance company does) or whether a claim will be paid or denied.

Can an insurance broker save me money?

A car insurance broker can save you money (and time) by getting multiple price quotes for you at once. Car insurance quotes are always free. Shopping around and comparing prices is one of the best ways to get a good deal on insurance.

An insurance broker can also help you zero in on the right company based on what coverage you want and your budget. Brokers tend to have wide knowledge of insurance company offerings.

An insurance agent who works for one company, on the other hand, will be limited to what that company offers, but will usually have a deep knowledge of that company’s products.

How does an insurance broker make money?

Insurance brokers and agents are paid a commission by the insurance company when they sell an insurance policy. The commission is usually a percentage of the policy’s premium.

Some insurance brokers will charge a fee to customers. Generally a broker fee has to be “reasonable” and must be fully disclosed to you -- no secret fees allowed.