IA Vs Insurance Broker

[AZusa Insurance]

Wondering what the difference between an IA vs Ins Broker are? I know what the DOI differences are but wondering about the real world differences? Do brokers need to get approved by Ins Co to write for them and if so, is it much easier or harder to get approved over getting appointed? Do most of the competitive Ins Co work w/ brokers and do they pay the same commission rate on NB/renews as they do to IA? Are brokers given binding authority? What are the pros/cons of broker over IA?

Also, what are the advantages/disadvantages of using a broker over an IA? All of the brokers I've interviewed w/ want to charge a broker fee. Why would prospects pay that if they can get the same policy through an IA, or do most of Joe Public not know the difference?

Thanks in advance.

 

[Sales71]

What do u mean by IA?

 

[AZusa Insurance]

Independent Agent. In CA broker and agent license are the same except you need to get a $10k bond to become a broker. Brokers can charge broker fee as long as they write policy for an insurance co they are not appointed w/. IA are appointed w/ Ins Co and cannot charge broker fees. As far as writing policies w/ ins co you're not appointed w/, I have know idea how that works thus am asking on here.

 

[Sales71]

Okay got u. I always thought about brokers fee as well. I do not charge a broker fee. I am currently captive agent. I wish I did.

 

[OCinsurance]

Different companies have different contracts, some offer broker agreements and some order agency contracts. Unless you go through a wholesaler, how would you sell a policy, even as a broker?

 

[Sales71]

Kind of a wired question.

 

[Franz Kafka]

I remember that from the license exam. In the real world, brokers and independent agents are used as synonyms. Why would you want to make a sale and charge a service fee instead of getting the commission?

 

[djs]

Wow, I'm confused....
In California, if you sell P&C, you are a licensed Broker. Don't believe me? Look at a copy of your license, see what it says.

This is true whether you are captive or Independent.

Yes, there is a disconnect between what the DOI uses and how the public inteprets the terms 'Broker' and 'Agent'.

Anyone who pays a broker fee on a standard personal lines policy deserves what they get. If the broker/agent can talk them into it, good for them.

Dan

 

[Guest]

I say to people, I am a broker, I will shop it out to over 40 companies for you.......