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Insurance Brokers and Their Responsibilities

Insurance Brokers and Their Responsibilities

An insurance broker is an individual who acts as an intermediary between the insured and insurer whose work description is to sell insurance products including life, health, property and any other insurance coverage to their clients. They may work independently or for an insurance brokerage firm. They are equipped with both their insurance know-how and the background information of their clients to find out the best insurance policy that suits a clients need for a reasonable price.

There are two types of Insurance brokers namely; retail and commercial brokers. Retail Insurance Brokers work directly with individuals and companies to provide coverage for people, vehicles, travel, or property whiles Commercial Insurance Brokers on the other hand, work with high-value coverage plans. They deal with insurance plans for airplanes, ships, heavy machinery, and other expensive assets.

 Insurance Brokers Provide Risk Assessments Reports

 Based on experience and training, a broker analyzes the risks and liabilities of a property and then provides a risk assessment report. This helps client decide carefully what coverage they need. Brokers endeavor to understand each aspect of your coverage needs before recommending any coverage solutions. There are many options with various limits, coverage, and exclusions for each policy. It’s hard to know what types and levels of coverage are right for your situation. Using an insurance broker makes the process of choosing insurance easier. An insurance broker, will evaluate your risk exposure and structure according to the anticipated risks and ensure proper and professional transfer of such risks to the insurance company.

Insurance Brokers Serve As Link Between Clients And Insurance Companies

It is an insurance broker’s responsibility to represent an insurance company or companies, mostly in an independent capacity. He or she brings the clients and insurance companies together. Depending on the customer’s needs, he or she assists the client in finding the cheapest and best insurance coverage for their requirements. It’s the responsibility of the broker to present a buyer to various underwriters and obtain quotations and commitments based on a client’s offer.

Insurance Brokers Serves As Communication Link Between Clients And Insurers

An insurance broker has the role of a liaison between the insurer and client. The broker ensures the smooth flow of communication both ways. In the case of claims, he or she ensures the client is up to date on the decisions and progress of their applications. They monitor and ensure these claims are settled peacefully between the insurer and client. In cases where a client loses policy documents, the broker follows up to help them get a replacement.

Insurance Brokers Help Save Cost On Premiums

A broker provides you with a range of different insurers’ quotes for more options to fit your needs and your financial budget. The ability to scan around for the best price from several carriers usually saves you money when you use a broker. Policyholders using insurance brokers make fewer unnecessary claims, and are more likely to be insured for the right amount. This intends saves insurance companies money. As a broker’s client, you have lower premium cost options. Thence, insurance companies offer brokers lower rates because the companies know brokers guide their clients to purchase the right policy with proper coverage.

Insurance Brokers Negotiate Premiums/ Rates

An insurance broker will negotiate for best and comprehensive policies with wide coverage and extensions at very competitive insurance rates. They help to procure insurance quotations from various insurance companies for tender purposes and analyze such quotations to ensure you make informed decisions when choosing your covers and insurer.


Source: Reuben Affum-Ankamah (Real Estate Times Africa)

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