Insurance Brokers in Nigeria 2020 - All you need to know

An insurance broker is a professional who represents consumers in their search for the best insurance policy for their needs. They work closely with their clients to research coverage, terms, conditions, and price and then recommend the insurance policy that best fits the bill. An insurance broker sells, solicits, or negotiates insurance for compensation.

Insurance Brokers in Nigeria 2020

What is the main difference between insurance company and insurance broker?

While an insurance company is a business that provides coverage, in the form of compensation resulting from loss, damages, injury, treatment or hardship, an insurance broker is an entity that specializes in insurance as well as in risk management. They sell, solicit, or negotiate insurance in return for compensation.


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What is the difference between insurance broker and insurance agent?

While both are professionals in the insurance industry, the two job titles have some distinct differences. The primary difference between an insurance broker and an insurance agent is who each represents. While a broker represents the insurance buyer, an agent represents one or more insurance companies.
An insurance agent is a professional who sells an insurance company’s products to consumers for a commission. An agent helps consumers select the right insurance to buy, but represents the insurance company in the transaction.
An insurance broker is a professional who represents consumers in their search for the best insurance policy for their needs. They work closely with their clients to research coverage, terms, conditions, and price and then recommend the insurance policy that best fits the bill.

In other words, there are two main differences between insurance agents and brokers:
Agents represent insurers, while brokers represent consumers.
Agents can complete insurance sales (bind coverage), while brokers cannot.

Agents also receive appointments to represent one or more insurance companies, but brokers do not. An appointment is a contract an agent and insurer sign that outlines the products the agent can sell and for what commission.

Brokers, on the other hand, can solicit price quotes from multiple insurers. But when consumers are ready to buy, they must obtain a binder directly from an insurance agent or the insurance company. Both insurance brokers and insurance agents act as intermediaries between insurance buyers and insurers. They both must also have the appropriate licenses to distribute the insurance they are selling, while also adhering to any laws or regulations enforced by local insurance departments. The primary difference between an insurance broker and an insurance agent is who each represents.
Insurance brokers specialize in insurance and risk management. Unlike insurance agents, brokers work for you rather than the insurance companies. An insurance broker uses his knowledge and experience to help you assess your unique insurance needs, find the best coverage and value, and can assist you when making a claim. As insurance brokers work directly with insurance buyers, you can rest assured that an expert is available to receive your calls and answer any insurance questions you have. Working with an insurance broker, and taking advantage of their knowledge and experience, can make the shopping and selection processes easier and help you avoid unnecessary costs.
There are two kinds of insurance brokers, or agents, namely captive and non-captive, also known as independent insurance brokers. While captive brokers are committed to selling insurance for a single carrier and must put the insurance company’s interests first, an independent insurance broker offers multiple policy and product lines from a broad selection of insurance companies. An independent insurance broker puts the customer first, offering up their experience and resources so that the customer can get the best coverage possible to suit their needs and budget.

 

Five Reasons to Use an Insurance Broker

Many insurance companies have encouraged those shopping for insurance to “go direct” and save money by cutting out the middle man. However, there are several reasons why using an insurance broker to assist you in navigating the shopping process could be a valuable choice.
1. Cutting out the middle man doesn’t save as much money as you may think. In fact, broker pricing is often much better than direct insurance pricing. Insurance companies provide brokers with lower rates because brokers are professionally trained to accurately assess risk and to help their customers choose a policy that adequately insures them. Businesses purchasing insurance through a broker will naturally present a lower risk because of the broker’s skill at evaluating businesses.

2. Brokers usually offer online as well as phone service, and generally are more proactive about engaging the customer after they have received their initial quote.

3. Getting a speedy quote after your initial consultation is more consistent with insurance brokers, and even mid-term changes get a quick response. Brokers also have the knowledge and experience to make their suggestions more useful to you as a consumer, saving time and money in the process.

4. Insurance brokers are trained to handle all aspects of insurance. They have the experience and knowledge to evaluate your business and access to a wide variety of policies for comparison shopping. Both the insurance company and the customer, will have peace of mind knowing that everything is covered.
5. Insurance brokers offer customers a stronger feeling of security with their close relationship when it comes to the safety of their personal information. Their ability to deal with specific insurance questions one-on-one is also a contributing factor to the trust that customers feel when working with an insurance broker.
Insurance brokers are uniquely equipped to save you money when shopping for business insurance. Even after your policy is purchased, brokers can offer you the peace of mind that knowledge, experience, and trustworthiness provide. Though direct-sales insurance has its merits, shopping for your business insurance coverage, and managing it afterward, will be a smoother and overall more beneficial experience when it is done with an insurance broker. They tend to be closer to the customers and in that regards always in position to know what the customers need from time to time.

 

Do Insurance brokers charge fees?

In some instances insurance brokers charge a fee in excess of commissions because of the work they are doing which may go above and beyond the normal effort required. Something like the broker coming to your business on a regular basis in order to enroll your employees, or perhaps to conduct regular safety meetings.

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