Unlike an exclusive agent, who sells only one insurance company's products, an independent life insurance agent represents more than one insurance company.
Independent agents can offer a wider choice of products because they're not tied to just one company, but exclusive agents, also known as captive agents, have the dedicated support of large, experienced organizations behind them.
Read on for more on independent life insurance agents and to find out what type of agent is right for you.
Key takeaways
- Independent life insurance agents work with multiple companies, while captive agents represent one company.
- Independent agents can provide quotes from more than one company, and are paid a commission by that company when they sell a policy.
- Some independent life insurance agents, known as impaired risk specialists, help people with medical conditions and other risks to find life insurance.
How do independent agents sell life insurance?
Some independent agents work for a large independent insurance agency, or they have a solo office with a small support staff. Regardless of the office setup, independent life insurance agents have a variety of insurance companies from which they can draw quotes and sell policies.
When you request quotes from an independent agent, they can help you shop from among the various companies they work with, so that you can compare rates and policies and choose the best one for your needs.
Independent agents earn a commission from the insurance company when they sell a policy. So, although they don't work for just one company, they do still work for the insurance companies and represent them when working with clients (you). That differs from a broker, who may also provide quotes from many companies, but works on your behalf and not the company's. Brokers may charge fees for their services.
What are impaired risk life insurance agents?
Independent agents who specialize in helping applicants with medical conditions or risky hobbies are known as impaired risk specialists. These agents know which life insurance companies offer the most competitively priced products for applicants in these circumstances.
The underwriting process varies among life insurance companies. One company might offer better life insurance quotes for applicants with diabetes than other insurers, for instance. Some companies are more lenient for risky habits, such as cigar smoking, than others, and some insurers are more comfortable than others with covering people who have risky hobbies, such as scuba diving.
A good impaired risk specialist may inquire on your behalf about your particular situation before formally submitting an application for life insurance.
Whether you look for an exclusive agent or an independent agent, first get referrals from friends, colleagues and other advisers, such as your accountant. Seek for an agent with experience serving clients with needs similar to yours, and find one with whom you feel comfortable and can trust.
