Difference Between Insurance Agent and Broker

Insurance is used in securing the future. There are a lot of insurances available, say home insurance, life insurance, and other insurance, which safeguard our life and money.


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Insurances are made by a company for loss, damage, death, and for protection against a possible eventuality. Insurance agents and insurance brokers make up the organizations that work in securing people’s futures.

Insurance Agent vs Broker

 The difference between an Insurance agent and a Broker is that an insurance agent is an authorized person from the company. Agents represent the broker, whereas the broker represents you as a client. A broker is a client who acts as an intermediary body between the company and the customer. They are the ones who help people find their required policy.

Insurance Agent vs Broker

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An insurance agent is also known as a captive agent. He is a person who works for a company and sells the insurance products of the company.

The Insurance agent sells insurance products of one company. People will not be able to compare it with other insurance products in the market.

An insurance broker can provide insurances with more choices. They can assist you in selecting the type of insurance which is suitable for you.

Insurance Brokers make good money compared to insurance agents. They are the intermediaries between the company and the customers.

They also represent the consumers.

Comparison Table

Parameters of ComparisonInsurance AgentInsurance Broker
DefinitionThe Insurance agent is the client of a company. They help in serving the intermediary role between customers and brokerage.Broker represents people as a client. They help people to choose the insurance policies.
Number of typesThere are two types of insurance agents. They are captive agents and independent agents.There are three types of Brokers. They are retail brokers, wholesale brokers, and surplus lines brokers.
IncomeThe Insurance agent work in a company. Their salary is credited to them from the organization.By attaining insurance for the client, the insurance broker receives his income on a target basis.
QualificationA Insurance agent must have a bachelor’s degree.Insurance Brokers do need a diploma qualification or bachelor’s degree in fields like insurance and finance.
Market strategyThey are supposed to have good strategy and skills to convince the companies.They have good exposure in the field as they are more experienced.

What is Insurance Agent?

Insurance agents are the client of a company. They refer people to choose their insurance as per their terms.

They sell the products for an insurance company. They only work for firms.

They cannot compare prices with other insurance products in the market. Insurance agents are different from Insurance brokers.

The insurance company pays the salary of the insurance agent. These agents may get incentives based on their sales performance.

Independent agent is an additional category under insurance agent. Wherein they work with different companies to an insurance broker to sell their products.

They are also interested in selling additional products from the same company in which they are employed.

There are different types of insurance agents. They are independent agents and captive agents.

They are the employers who work for an insurance company as part-time or independent contractors. The independent agents are insurance agents who sell insurance products from different insurance rather than working for a single carrier and refer different insurance companies that have offers and different types of insurance options.

They also have a connection and have a piece of wide knowledge about the market and have different insurance choices for the costumers.

What is Insurance Broker?

Insurance brokers are the person who acts as an intermediate between the insurance company and the consumers. The Insurance Broker helps the consumers to select the insurance which is needed for their life.

The Insurance Brokers do not represent the company. Rather they represent only the consumers.

The Insurance Broker’s duty is to satisfy the need of the customers.

The insurance agent makes money by selling the insurance products to an individual or business. They also sell all types of insurance, including health insurance, life insurance, home insurance, accident insurance, and other health coverages.

The advantage of hiring an insurance broker is that they work directly for you. They also help the client to choose a policy of their choice.

The insurance broker’s main role is to help people to decide between the best insurance plans.

The insurance broker cannot close a deal on the policy since that can only be done by the insurance company. A state license should be acquired by the insurance brokers to practice the duty.

They make money based on the insurance they sell. They do get a commission for selling it.

There are totally three types of brokers, namely retail brokers, wholesale brokers, and surplus line brokers.

Main Differences Between Insurance Agent and Broker

  1. Insurance brokers are the employers of insurance firms, whereas agents work under them under terms or freelance conditions.
  2. The Insurance agents are of two types, namely captive agents and independent agents. Whereas brokers are of three types, namely retail brokers, wholesale brokers and surplus line brokers.
  3. The insurance brokers work for a company, their salary is released by the company. Insurance agents receive a commission based on performance.
  4. The Insurance agents must have a bachelor degree. But Insurance brokers need a diploma in the field of insurance and finance.
  5. Insurance agents are supposed to have good strategies and skills. Whereas, Insurance brokers have good experience in the field.
Difference Between Insurance Agent and Broker
  1. https://heinonline.org/hol-cgi-bin/get_pdf.cgi?handle=hein.journals/onulr29&section=13
  2. https://www.jstor.org/stable/25763705
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