National Insurance Broker vs. Local Insurance Agent

Comparing prices and coverage from multiple insurance companies is an important part of the insurance shopping process. While you can gather quote comparisons on your own, you can also opt to go through the process with a professional. If you’re considering partnering with a professional to shop for insurance rates, you have the option to work with either a national insurance broker or a local agent, with each offering a different experience. Here’s what you need to know about using a national insurance broker versus a local agent.

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Definitions and Responsibilities: Broker vs. Agent

When choosing between a national insurance broker and a local insurance agent, it’s important to understand the differences in their roles and responsibilities:

Local Insurance Agent

A local insurance agent sells and negotiates various forms of insurance to match the needs of their customer. An agent may work for multiple insurance companies, more representing the company than the customer, often making their money entirely from commissions. At SelectQuote, our licensed insurance agents are licensed in all 50 states, and while they may be local to you, as a national insurance brokerage, we may be able to provide you with more choice and tailored coverage from the trusted insurance companies we represent.

National Insurance Broker

National insurance brokers work as an intermediary between the customer and the insurance company. A broker represents the customer instead of the insurance company and is often a better option for those with complicated insurance needs. SelectQuote is an insurance brokerage that partners with multiple home and auto insurance companies to match you to the best insurance carrier and coverage for you. SelectQuote not only gives you price quotes but also handles every step of the insurance buying process.

Differences Between a National Broker and a Local Insurance Agent

When deciding between a national insurance broker and a local insurance agent, it's important to consider how each can serve your needs, particularly when it comes to coverage options, pricing, and customer service. Both play vital roles in the insurance process, but they offer different experiences and expertise depending on your location, the type of insurance you need, and your overall preferences.

Geographic coverage

A local insurance agent offers distinct advantages when it comes to policies tailored to your specific location. They have an intimate understanding of local risks—like weather patterns, natural disasters, or community-specific hazards—and can provide personalized recommendations for coverage that best protects your home and assets.

In contrast, while a national broker may offer a broader range of options, they may lack the same level of localized expertise and personal insight into regional risks.

Quotes and Cost

The process for obtaining quotes and completing your insurance purchase differs between brokers and agents. A local agent typically handles the entire transaction, from providing quotes to finalizing the policy.

They work with the insurance company directly and can often offer a more streamlined experience for buying insurance. A national broker, on the other hand, offers multiple quotes from various insurers, allowing you to compare coverage options and pricing. However, once you've selected a policy, the broker will direct you to the insurance company.

The Customer Journey

The customer journey with a local agent is often more personalized because they may have a deeper understanding of your unique needs and circumstances, simply due to their proximity. They can offer advice tailored to your local community and be more hands-on with ongoing service.

Instead, a national broker represents your interests rather than the insurance company, ensuring you receive unbiased advice. With brokers, you’re more likely to get a wider range of options and competitive pricing.

Dependability

When it comes to dependability, national brokers offer peace of mind by representing large, well-established insurance companies with proven financial stability. These brokers often work with top-rated insurers that have been in business for decades, ensuring that claims are paid promptly and reliably.

While a local agent can provide similar services, their ability to navigate claims and policy details may be influenced by the reputation and capacity of the local insurance companies they represent.

Pros and Cons of Using a National Broker vs. Local Agent

Factor	National Broker	Local Agent
Geographic Knowledge	Limited local expertise; focuses on broad coverage	In-depth knowledge of local risks and community needs
Cost Comparison	Can provide multiple quotes from various insurers	May offer fewer pricing options, depending on the insurers they represent
Coverage Options	Access to a wide range of insurance providers	Typically represents a limited number of insurers
Personalization	Less personalized, but tailored to overall needs	Highly personalized service based on local knowledge
Claims Support	Can help compare claims handling across insurers	May have closer, direct relationships with clients during the claims process
Flexibility	Offers a variety of policies across different companies	Limited to the products available from the insurer they represent
Dependability	Tends to work with large, well-established insurers	Can provide more hands-on, local customer service
Experience	Broker represents your interests, offering more options	Agent represents the insurer, focusing on specific products available from their company

How much do car insurance brokers cost?

Car insurance brokers typically do not charge direct fees to customers, as they earn a commission from the insurance companies they work with when a policy is sold. However, the cost of working with a broker is often reflected in the price of the premium, as brokers may receive a percentage of the policy's cost. It's important to compare quotes and ask the broker about any potential fees or commissions to ensure transparency and determine the overall value.

Is insurance cheaper without a broker?

Insurance may not be cheaper without a broker, depending on various factors. While brokers can often find competitive rates by comparing policies from multiple insurers, going directly to an insurance company might seem like a cost-saving choice. However, brokers can sometimes access exclusive deals or discounts not available to the general public, potentially offering better value than buying directly from an insurer.

How do home insurance brokers make money?

Home insurance brokers typically earn a commission from the insurance company when they sell a policy. This commission is usually a percentage of the premium paid by the customer. One benefit of working with an insurance broker like SelectQuote is that our licensed insurance agents don’t receive incentives or additional commission for particular carriers, so they’re committed to working for you with your best interest in mind.

Is it better to go with an insurance broker or insurance company?

Whether it's better to work with an insurance broker or an insurance company depends on your needs. Brokers offer the benefit of comparing multiple insurers to find the best coverage at the most competitive price, while insurance companies provide direct access to their own products. If you prefer more personalized advice and a wider range of options, a broker may be the better choice, but if you’re loyal to a particular company or need straightforward coverage, going directly to the insurer might be sufficient.

How do insurance brokers get quotes?

Insurance brokers gather quotes by reaching out to multiple insurance providers and requesting pricing based on the customer’s specific needs and circumstances. They provide the insurer with information about the client’s risk profile—such as their home’s value, driving history, or health conditions—and the insurer responds with a quote based on that information.

How SelectQuote Can Help You Find the Right Insurance For You

No matter where you live, what your situation is, or what you need insured, SelectQuote is here to help find the coverage you need at a price that fits your budget. We work with some of the most trusted carriers and can help you understand the different types of coverages available, your opportunities for discounts, and answer any questions you have. Our process takes just minutes, saving you time and money.