Broker or online: which one is better?

Wednesday, October 17, 2012


In today’s market it seems that insurance agencies can’t afford not to have an online presence. Consumers are now able to receive almost instant quotes online by filling out short forms. Does this mean the era of agents is dead? Let’s look at the pros and cons of both situations.

Pros for Online

I’m not entirely sure what the rising generation would do if online quotes didn’t exist. During the last decade agencies have promoted insurance quotes online as “quick” and “easy”. Online insurance quotes come with a myriad of benefits which include:

  • Fast. These days quotes are almost instant. Consumers are asked to fill out a few fields of information for an accurate quote in return.
  • Convenient. Users can jump on the Internet at their own leisure. There are no time limits, or deadlines to receive auto quotes. In addition, you can receive an insurance quote from almost any location using a computer.
  • Informational. Gone are the days of using the phone book to locate several agencies for price quotes. Now, a simple click of a button can return several quotes from different agencies at once. Consumers can also actively research agencies to find which benefits, features, and plans work best for them.

Pros for Brokers

Agents seem to be a dying bunch. While most insurance agencies focus online, agents seem to be left behind. Yes, some agencies have campaigned to show that there agents can help during accidents and recovery; however, when’s the last time you saw an insurance agency promote their agents to give insurance quotes? Here are some benefits of using Brokers that may be shocking:

  • Relationships. Brokers make a living off their relationships with agencies and clients. Take Sarah for example. She’s a 54 year-old woman who has been using brokers her entire life. When I asked her why she used a broker she replied,”Tom, my agent, has always looked out for me. He fought with agencies to get me the best discounts and prices. I recently had an agency who told me I had to cover the cost of a tow even though I had a towing package in my premium. I went to Tom and said find me another agency! Soon after, he came back to me and let me know I had a new agency and he had expressed his disappointment to the previous insurer.” There are brokers all around the country that have similar stories.
  • Knowledge. Brokers know the industry. They know all the discounts out there and who qualifies for those discounts.
  • Fight for you. In Susan’s story you may have noticed how her broker fought for her. That’s their job. When you use a broker they want you to get the best price in town because it helps them satisfy your needs and build a reputation for themselves.

Cons for Online

Despite the convenience and ease there are some things consumers miss out when using an online platform.

  • Overarching knowledge. Using an online insurance tool can be somewhat scary. How much liability or deductions should you? Am I receiving all the discounts? Most sites provide informational resources; however, in most situations they are not enough.
  • No benefits or relationships. Consumers miss out on certain perks driven from relationships when using online platforms. Brokers have established relationships that in turn yield fruits for their clients. When a consumer chooses to use online they miss out on those perks.
  • Who fights for you? You’ve decided to select an agency but during that process they’ve somehow wronged you, who’s in your corner? Foregoing a broker is sort of like foregoing on a lawyer during trial. You’re now left to fight for your case by yourself.

Cons for Brokers

While you receive perks and benefits on a discount level there are some cons associated with using brokers:

  • Time. Using a broker isn’t the fastest option. Usually a consumer will have to meet with the broker and discuss what they’re looking for. This sort of process takes time.
  • Convenience. Unlike online platforms using a broker usually requires going to a brick and mortar store to discuss plans.

Who wins the battle?

Brokers. While online quotes offer ease and convenience they cannot replace the benefits of relationships and someone fighting for you. Brokers know the industry better than anyone else and leverage that knowledge to provide the cheapest rates for their clients. For these reasons brokers win hands down.

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