Exclusive Agents vs. Insurance Broker
In the trade credit (also known as AR insurance) industry, there are two main types of representatives: exclusive agents and insurance brokers. The main difference between the two are that brokers write coverage for multiple insurance companies, while exclusive agents only work for one. This article will discuss the basic functions of insurance brokers, as well as the benefits of choosing them over exclusive agents.
Why is a Broker Better?
Trade Credit Insurance brokers undergo extensive training that focuses on understanding the different types of insurance, but also the credit risk management process. The biggest benefit of choosing a broker is that they work for you. Since they are independent, their best interests are providing value to their customers instead of creating the most profit for an insurance company. Brokers will listen to customers’ insurance preferences and search the insurance marketplace for solutions that best fit the clients’ needs. Brokers will also assist their customers in preparing their claim and make sure that they get quick and high quality service from the insurance company.
What Makes a Good Broker?
It is important to note that insurance brokers are not just salespeople, they are advisors. Brokers should make time to outline the potential benefits and risks of different policies with their clients. Good brokers act as the intermediary between their clients and their respective insurance companies and try to negotiate concessions from the insurance carrier that strengthen the policyholder position.
The Bottom Line
When it comes to trade credit insurance, it is important to select a broker who is knowledgeable and experienced that will go the extra mile to understand your company’s expectations and needs. Cost is not always the driving factor in choosing which policy to purchase. Instead, brokers focus on a variety of factors such as conditions, cost, coverage, and exclusions to help decide which policy is best for your company. Utilizing a broker and leveraging their relationship with the underwriting community will help you obtain the best policy available for the policy terms and conditions needed to protect your largest asset.