Comparing Insurance Quotes, Brokers, and Agents – What You Need to Know
When preparing to purchase or renew auto insurance, Canadians typically come across a lot of conflicting information. Should they buy direct from the insurer, or should they use a broker or agent? What about shopping for quotes online? Is that worth the time? Wading through all the details can be challenging, so many consumers get confused and frustrated.
Customers who don’t understand what’s best for them when buying insurance are more likely to choose the wrong option. They get saddled with auto insurance that either does not meet their needs or is too expensive.
That does not have to happen. Understanding the benefits of comparing quotes online and knowing the pros and cons of buying direct or through agents or brokers can help get the best auto insurance possible. Buying insurance can never be described as “fun,” but armed with knowledge, it’s possible to save money and get the best coverage possible.
Why Shopping for Quotes Is Important
Perhaps the main reason people decide to shop for insurance quotes is to get the best deal and pay as little as possible for the policy they need. However, there are some other significant benefits aside from getting the best rate. InsuranceHotline.com explains some of the main advantages of comparing quotes online.
- Keep up with changing rates – The most common reason people choose to shop online for insurance is to find the best prices. It’s important to shop for better rates each time you renew your policy. Many people don’t realize that auto insurance rates change all the time, so there will be different rates each year they renew. Customer situations also change, meaning their circumstances could directly affect how much their insurance costs.
- Plugging coverage gaps – Surprises can be good, but insurance surprises seldom are. There’s not much worse than contacting an insurer to make a claim only to find the level of coverage was not as robust as first thought. Shopping for quotes helps avoid those nasty surprises by highlighting gaps in coverage while also showing additional policy benefits that can be added for the same cost.
- Staying put – It’s often said that shopping for insurance quotes helps customers find a better deal when they renew. However, what usually happens is the customer discovers they are better off sticking with their current insurer. There are not always better rates available, and sometimes it’s possible to get a fantastic deal without switching. Importantly, customers only know this is they compare quotes from other carriers.
- Building a strong policy – It’s common for customers to provide fuzzy information when building their insurance policies. Perhaps they give an incorrect detail about a vehicle or what their coverage needs are. These simple errors can be costly down the road if the insurer won’t pay out a claim. Comparing quotes online forces customers to input their information and carefully review what they need from their coverage.
What’s Best: Agent vs Broker vs Direct
The terms “insurance broker” and “insurance agent” are often bundled together and used interchangeably. It’s understandable that customers become confused and believe agents and brokers fulfil the same function. When you add “direct insurance” into the mix, the situation becomes more complex.
- Insurance agent – You can think of insurance agents as working for one insurance company. They are usually employees of an insurance company that help to sell coverage to customers. Customers do not know whether they are getting the best price possible on their rates because they won’t be comparing against other providers.
- Direct insurance – While selling direct is similar to an agent, it removes the middleman. Insurance companies sell directly to customers by advertising their products. When the customer makes contact, a call centre agent will walk through the policy details and finalize the coverage. Like with agents, there is no way to know if you are getting the best possible rate.
- Insurance broker – The most significant differences between brokers and agents or direct sellers is a broker works for the customer and not insurance companies. Brokers can only thrive by becoming champions of the customer, working with consumers, and building relationships with them. It is the broker’s job to help customers find the best possible coverage at the most affordable price.
Whether using an agent, buying direct, or working with a broker, always compare quotes online to ensure a fair deal. Remember, the best result is not the cheapest coverage but rather the most affordable policy that meets all your insurance requirements.