Should you obtain your insurance from an agent or a direct writer?
This is a question that many people contend with — whether they’re shopping for home, travel, life, auto, business, or other forms of insurance. In the following article, we’ll go over both of these insurance buying options and let you know which is optimal when you’re looking for the best coverage, limits, premium prices, and service.
Direct Writers Vs. Agents: Which Is Better?
When discussing insurance with various people, you’ll get mixed reviews about what the best way to buy policies really is. Still, there are some general pros and cons to each method that can’t be ignored.
Let’s go over each one:
First, there’s what’s called direct writer insurance. A direct writer insurance company is simply an insurance company or who does not employ agents or brokers to sell their insurance. Instead, individuals looking for insurance policies can simply go directly to them and choose their plans. Benefits of this way of buying insurance include the following:
- Direct writer insurance can get you set up with a policy fairly quickly.
- You can choose your plan on your own time.
- You can shop around for the best deals.
Unfortunately, there are also drawbacks associated with direct writer insurance. These include:
- No agent who will explain the various policies, features, and fine print to you.
- No guarantee of the best deals. It’s up to you to know your prices.
- A lack of advocacy — direct writer companies have representatives, but they generally don’t have your best interests at heart.
Now, let’s take a look at agents.
There are two types of insurance agents. First, there are independent agents. These agents are licensed to sell insurance from several insurance companies. Next, there are captive agents. These agents are licensed to sell insurance from just one company.
The benefits of working with either of these types of insurance agents include the following:
- Both types of agents are local. You’re not dealing with a faceless person over the phone or online.
- They’ll do the research needed to come up with your best plan options on your behalf (as long as they are through the company or companies they write policies for).
- You can choose an agent and stick with them. Even if you switch plans (again, as long as your new plan’s still with the company your agent writes policies for), you won’t have to leave your agent.
There are drawbacks to agents as well, but most of the drawbacks have to do with captive agents. Captive agents only work for one insurance company, so they’re not always going to have your best interests at heart — much like direct writers. They can’t offer you an array of policies; they can only offer you policies through their parent insurance company. This is the major drawback of working with captive agents.
On the other hand, when you work with an independent agent, you’re not only getting all of the agent benefits listed above, but you’re also going to get a better value and more choices and freedom when it comes to choosing your policies.
Some people think that because insurance agents earn a commission, working with them is pricey. In fact, because of the amazing value, you’ll be getting from your independent agent, what you’ll be paying will still be extremely reasonable — yep, even when you factor in their commission.
When you’re looking for superior service with an independent agent, look no further than Lillie-Couch Insurance. Our team can help you find optimal policies with excellent coverage and rates. Call or stop in today!