What Is a Life Insurance Broker 

What Is a Life Insurance Broker

Most of the time, when I have my initial consultation with a client to (be it in their home or over the phone), I try to explain the difference between a life insurance agent, and a life insurance broker. This is an important step in building trust with a client because of the ways that working with a broker can benefit the client. To begin with, all brokers in any state are licensed agents in their home state. We all have a to take a certain number of hours of training with our home state, and we all sit for the same licensing exam. At that point, though, there are essentially two career tracks: agent and broker.

Who Do Life Insurance Brokers and Agents Work For

When people talk about an agent, they generally mean that they responded to a television ad and called State Farm or Allstate or MetLife, and spoke with an agent who is trying to find the right policy for them within the menu of products that their company has to offer. Agents at these big companies are generally on salary, and earn extra commission for each policy they write and maintain. The benefit to taking this path is more income certainty from week to week, and a constant flow of customers because of the hundreds of millions of dollars that these companies spend on advertising each year. Because the agent is an employee, you can be 100% sure that if you talk to a State Farm agent, he or she is going to try to get you to commit to a State Farm policy. Their first loyalty is to the company.

Comparing Brokers and Agents

  • Agents typically work for a specific company and want to sell you their specific policy product
  • Brokers work for you, and want to find the policy that matches your needs
  • Brokers are able to shop around for the best priced policies from many life insurance companies

How Life Insurance Brokers Can Help You

A broker, on the other hand, runs his own independent business. A broker is appointed with as many different companies as he wants to be, which means that they are allowed to represent those companies and sell their products, but doesn't get any compensation if no sale occurs. Of the almost 900 life insurance providers in America, I am appointed with 23, and of those, I generally use about seven. A broker is responsible for his own marketing or to hire someone to do it for them, but that gives them the freedom to give their first loyalty to the customer rather than to any one company.

This allows brokers to compare companies to each other, along with comparing different types of policies, like for example whole vs term life insurance policies. If I come into your home and show you a policy from Transamerica, I do so because I believe it has the best combination of price, benefits, and ability to get you approved. However if you say to me, Kent, my dad had a policy with them and he didn't like them, so I don't like them either, then that would be the end of the conversation if I were Transamerica employee. But as a broker, I'll simply find you a company that you're comfortable with. Transamerica, by the way is a great company and I use them all the time for everything from affordable term life insurance to senior's life insurance with no exam or with no waiting period.

Looking for Insurance With an Agent vs a Broker

Broker Agent
Help you assess needs X X
Compare policy types X X
Compare companies X
Loyal to company X
Loyal to you X

Why You Should Choose Us

When you submit your initial inquiry here at Term Life Insurance USA, you may be speaking with me or you might speak with another of our affiliated partners, but you'll always be dealing with a broker rather than an agent, so you can have confidence that you are our first priority. Congratulations on taking the first step toward protecting your family from life's uncertainties. Hope to talk to you soon!

Written by Kent Straith, September 2018

Disclaimer: TermLifeInsuranceUSA.com is not a licensed insurance agency or broker. The content of this website is for informational and comparative purposes only and is not intended to take the place of professional advice from a licensed insurance agent. TermLifeInsuranceUSA.com recommends that all consumers consult with a licensed insurance agent before purchasing any insurance policy.

What Makes Us Different?

Hassle-Free Process

It only takes a few minutes to get the ball rolling by filling out our simple application form. With just a little information about you and your situation, we can connect you to the perfect agent who can meet your needs.

Specially-Matched Agents

Our proprietary matching logic does all the work of finding the right agent to handle your case so you don't have to. Finding someone who can truly understand your situation is very important in the process of buying life insurance.

Helpful Agent Support

Buying life insurance is a very important decision, and we want to make sure that every question and concern you have is addressed to your satisfaction. Our agent support is here and ready to help you out!

Data Driven Analytics

To pair you with the best agent available, we aggregate data from all across the industry and rely on science and math to determine the right insurance agent for you. We constantly refine our data models and continually strive to improve.

Fast. Simple. Free. Find the Perfect Agent for You

We analyze your situation in real-time comparing your needs to the offerings of our agent network, and our proprietary matching logic will immediately connect you to the right life insurance agent to help you get exactly what you need.

Get Started

Latest Blog Posts 

Life Insurance for Ex Smokers

Life Insurance for Ex Smokers

It's possible to get life insurance even if you're a former smoker or have other underlying health i...

Can You Get Life Insurance After a Heart Attack

Can You Get Life Insurance After a Heart Attack

It is still possible to get life insurance after a heart attack if consumers know what to look out f...

What You Should Know About Life Insurance for Diabetics

What You Should Know About Life Insurance for Diabetics

If you are one of the millions of Americans who have diabetes, you will need life insurance benefits...

Can You Get Life Insurance If You Are in the Military

Can You Get Life Insurance If You Are in the Military

The automatic policy offers some protection, but it may not be enough. It's important for military m...