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Finding the Right Insurance, Do we use an Agent or Broker?

Online insurance options offer quick, and easy shopping for all types of Insurance, such as, Auto, life policies & Health. In some cases online is all you need, other times speaking with an agent is necessary.

Not too many years ago when shopping for insurance, you would have discussed policies across the desk from a local insurance agent or over the phone.

Today we have several options available for evaluating insurance. This is great. But sometimes going old-school may the best option. If your coverage needs are simple, you can buy from an online insurance agent or broker without going anywhere or talking to anybody, for example: If you're healthy and looking into a 20 year term life policy you could should be able to effectively shop these rates and land at the best option online. But, if you're looking at auto insurance and you want to find out what prices look like with different deductibles or even changing drivers from one car to another (yes, if you put the husband as the 'primary' driver on the mini van and the wife as the 'primary' on the corvette that could save you money) This is best done with an agent.

Lets look at Life insurance:

Online life insurance agent or broker

Good if you:

  • Generally understand your coverage needs.

  • Want only term life insurance (coverage that lasts a set number of years).

  • Want to buy coverage on your own time with minimal help.

For Life insurance all you need is term insurance, an online agent or broker would fit the bill nicely.

Details on term: Term life insurance covers you for a certain period, such as 10, 20 or 30 years. It’s inexpensive and covers your family while building wealth until you are self insurable.

Traditional life insurance agent or broker

Good if you:

  • Want personalized advice.

  • Have complex needs.

Choose a traditional agent or broker if you need more hand-holding than an online broker can provide.

Confused about life insurance and how it fits into your overall financial picture? Consider hiring a financial coach who doesn’t make commissions on product sales.

‘Captive’ vs. independent life insurance agent

A “captive” life insurance agent sells products from just one company. A State Farm agent, for instance, can sell only policies issued by State Farm.

An independent agent or broker can sell policies from a variety of insurance companies. That means you can compare prices and offerings from different companies — but only those with which the agent has an agreement to sell. You can’t buy a policy through an independent agent from a company that uses only captive agents, such as State Farm, or only sells policies directly to the consumer, such as TIAA.

An independent agent is your best bet if you might have trouble qualifying for affordable coverage because of a health condition or a risky hobby.

An independent agent is your best bet if you might have trouble qualifying for affordable coverage because of a health condition, such as diabetes, or a risky hobby, such as scuba diving. A good independent agent will know the rate-setting guidelines at different insurers and steer you to the one most likely to offer the best-priced coverage.

Ask your accountant, attorney, financial coach or planner for referrals to life insurance agents.

How much life insurance do I need? You need 10-12 times your annual salary. How much does my stay at home spouse need? If your children are still at home they will need approximately $300K. If they are no longer there you will need to hire out many of the tasks that currently do.

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