Insurance Companies vs. Insurance Agents

insuranceThere have been countless incidents where customers have gone through with their decision to go with either an insurance company or an insurance agent without being aware of the difference between the two. This lack of an informed decision may mean the insurance policy purchased is possibly unsuitable.

There are some fundamental differences between insurance agencies and companies. For starters, insurance agencies are independent, and are locally owned. Insurance companies set standard pricing and prepare specific guidelines for their claims procedures; but with insurance agencies, the offers are tailor-made to suit customer’s needs, and pricing and procedures are also easily changed and molded.

Insurance agencies also represent insurance companies when need be, and sell as well as service the insurance policies to customers. Insurance agencies can represent and advise a customer if a claim is made for the first time, and also offer assistance in communicating customer’s requirements with insurance companies.

The pricing, coverage and service standards can be interchangeable and serviceable as per each customer’s needs; it is usually recommended that insurance agents be hired before making a claim. Insurance companies are known for establishing their own rates, rules and regulations, whenever a customer signs up with them. The difference between agents and companies, therefore, is that the latter may not be able to fulfill customer’s demands as thoroughly or communicate customer needs as comprehensively.

Insurance agents act as trusted advocates to customers and are given the time to fully comprehend the situation and advise a suitable claim and come up with adequate procedures. With time the agents may become reliable and trusted advisers to customers and start to work on their behalf in order to match up the needs of customers with clients.

Insurance companies usually sell policies directly to consumers, but some of their products are sold through independent insurance agencies so that customers who are in need of something particular are directed to them. Insurance companies only offer products at particular prices that are standardized. Also, they don’t usually offer to go the extra mile as agents might; for example, with car insurance companies the insurance agents will offer to go to the registry of motor vehicles to pick up new plates, or will be there to back up the customers claim at claim time.

The insurance companies are only available for particular business functions. Furthermore, if there is a hike in insurance policy rates, the insurance companies cannot help customers in saving money. The most they are able to do is cut the customers coverage, but with insurance agents there are varied choices to suit customer requirements. Agents can be hired to look for policy rates that are lower, as well as shop for rates that might be more suitable to the kind of claim the customer wants to make.

The best coverage can be shopped for with the help of agents, especially since they are likely to be more informed about what the current market is offering. Customers can fully communicate with and trust their insurance agents, while the most insurance companies will only allow customers to talk with sales representatives. These are likely to only highlight the parts of the product they want to sell, and will not inform customers of aspects that may not be beneficial.