When you ask for a quote, you may be talking to a broker, an agent or an employee of an insurer. They have different roles, even though the conversation may feel similar.
The usual distinction
- A broker generally sells coverage from a range of insurers. In general insurance in Ontario, brokers are regulated by RIBO.
- An agent typically arranges coverage with a single insurer. According to RIBO, FSRA licenses insurance agents who can typically only arrange coverage with a single insurance company.
- An insurer's employee or direct writer sells the company's own products, often through a call centre or website.
The words are not always used consistently in everyday talk, so ask.
Why it matters
- Range of choice. A broker may be able to compare options from several insurers. An agent or direct writer can speak only about their own products.
- Claims support. Brokers and agents may help with claims, but how much varies. Ask what to expect.
- Obligations. Licensed professionals are expected to ask about your needs and explain the coverage. Rules differ for different roles.
How they are paid
Many are paid commissions by the insurer when a policy is sold or renewed. Some also charge fees. You can ask how someone is paid and whether it affects the product they offer.
Life and health insurance
Life and health insurance is usually sold by licensed agents or advisors, often representing several insurers, and some sold by employees of a specific insurer. Ask which companies the person can offer.
Choosing who to deal with
The right choice depends on what matters to you: price comparisons, a long-term relationship, convenience or specialized knowledge.
Questions to ask
- Do you work for one insurer or several?
- How are you paid for this policy?
- Who do I call if I have a claim?