What You Should Know

• An insurance broker can scour the insurance marketplace to find you the best policy for your needs
• An insurance agent can only sell policies from one company
• You can shop for life insurance quotes online

If you're currently shopping for life insurance quotes, "insurance agent vs a broker" is probably the last thing you thought you would be conducting research on; however, becoming a smarter consumer can help you make better insurance choices.

Part of being a knowledgeable consumer means that you must be able to recognize the difference between an insurance agent and an insurance broker because if you're torn between, let's say, a health insurance agent vs a broker, understanding the difference about each position could help you make the best decision for you.

No matter the area of insurance, learning more about how these positions work, the differences between an insurance agent vs a broker salary, and more knowledge in general can empower you to make the best choice for your insurance needs.

And if you're specifically shopping for the best life insurance policy, you'll most certainly want to make sure that you trust the individual you choose to work with.

If you're undecided if it would be best for you to buy insurance through an insurance agent vs a broker, enter your ZIP code to start comparing free insurance quotes.

What is an insurance agent?

A life insurance agent is bound to work with just one company, and while that agent may be very knowledgeable about that one company's life insurance products, the agent will be unable to keep you up-to-date on other companies' policies.

But you should know that if you have any questions about your policy or want to review your life insurance policy, you can always reach out to your agent to do so. Many insurance agents also make themselves available to clients who need guidance while undergoing the claims process.

How Insurance Agents Earn Income

While you may think that an insurance agent who works solely for one company would earn a yearly salary that is not usually the case. Most insurance agents make their living by earning commissions off of the insurance policies that they sell.

Insurance agents can earn a commission of 5%-10% when selling a car or home policy and even as much as 50% when selling life and health insurance policies.

This is why you should always make sure that your agent isn't trying to sell you anything that you don't need or pressure you into buying a policy that you don't want.

Now, remember, if you've approached an insurance agent about purchasing life insurance and don't feel that the agent is answering all of your questions clearly or isn't being respectful towards you, you can find a new agent by perusing free insurance agent ratings online and even shop for life insurance online if you would prefer to make a choice without anyone staring over your shoulder.

What is an insurance broker?

If you're driven to obtain low life insurance rates, recognizing an insurance agent vs a broker may be able to help you do just that. You see, unlike an insurance agent, who hustles to sell policies for just one company, life insurance brokers are essentially free agents.

They can compare life insurance quotes from several different insurance companies in order to find the best policy for you.

Brokers are life insurance specialists who listen to what you need and then sift through all the possible policies offered by many different companies in order to find the best options for you. Once the broker has found some policies that you may be interested in, you’ll be able to choose the right one for you.

Now, you must remember that if you have a problem with your policy after you purchase, you'll have to reach out to the insurance company that issued it.

How Insurance Brokers Earn Income

Insurance brokers earn a commission just like an agent does. This means that if you loved one of the policies that the broker found you and purchased it, the broker would actually earn a small commission from the insurance company that provided that policy.

Can you shop for life insurance online?

If you’re someone who prefers to take your time when considering big purchases like life insurance, when you want to buy life insurance, “insurance agents vs a broker” may not even be a passing thought in your mind. You can find some excellent guaranteed acceptance policies by shopping online.

Other policies that require a medical exam may direct you to speak to an insurance agent, but with a guaranteed acceptance policy, you can typically answer a few questions online and then get coverage in minutes.

Now, you should take note that most guaranteed acceptance policies offer coverage that taps out a little over $20,000. So if you need more coverage than that, you should consider contacting an agent or a broker.

What is the best type of life insurance policy?

The best type of policy is almost impossible to name as everyone’s insurance needs are different; however, a better question would be: What is the best insurance policy for you?

An insurance policy is an incredibly powerful tool that can allow you to leave behind a legacy or simply provide some financial support to your loved ones once you pass on. Most life insurance companies offer a choice of a permanent or temporary life insurance policy. These are better known as whole or term policies.

Let’s examine these two policy types more closely so you can decide which type would best suit your insurance needs.

Whole Life Insurance

A whole life insurance policy will grow for as long as you are alive. This means that if you only bought $25,000 in coverage and passed away many years later, you could potentially be leaving behind far more than what you originally bought.

This type of policy can grow as you grow which makes this a very popular choice of insurance for young people and children. It also builds cash value that you can access while you’re alive. This means that if you need some extra funds to launch your new business or want some money to help pay for a house, you take a loan out from yourself rather than a bank.

This loan typically has far lower interest rates than a bank loan, but you will have to pay it back eventually.

Term Life Insurance

If you are someone who only needs coverage for a certain period of time and is on a budget, a term policy may be the best policy for you. Term life insurance is typically much cheaper than a whole life insurance policy since it does not build up any cash value and has an end date.

Young parents, for example, could benefit from this type of insurance. While bringing a baby into the world is an exciting experience, adding a new person to your household can put a strain on your finances. With a term policy, a young parent could provide an immense financial cushion for their loved ones while staying within their budget.

What You Need to Know About Insurance Agents and Brokers

When you need a new life insurance company, an insurance agent vs a broker matchup can lead you down the best insurance path for your needs.

You must remember that a life insurance agent can only sell you products that come from one company while a life insurance broker can examine policies from many different companies to find the right one for you.

When it comes down to choosing between an affordable life insurance agent vs a broker, you should give your business to whoever you feel most comfortable working with. Whoever ends up helping you find a policy should make you feel respected, listen to your questions, and make sure that you understand every aspect of the policy you want to buy.

If you can't decide to step into an insurance agent vs a broker's office, enter your ZIP code to start comparing free quotes from the comfort of your home today.