INSURANCE AGENT

The insurance agent is an individual who sells and services insurance policies. There are generally two classifications of agents:

1. Independent Agent

An independent agent represents at least two insurance companies, and services clients by searching the market for the most advantageous price for the most coverage. The agent's commission is a percentage of each premium paid and includes a fee for servicing the insured's policy.

2.Captive or Exclusive Agent

This type of agent represents only one company, and sells only its policies. This agent is paid on a commission basis in much the same manner as the independent agent.

What Does an Insurance Agent Do?

The agent system for the distribution of insurance has worked pretty well over the years, with agents marketing the products of the insurer and, at the same time, educating the consumers on how to limit risks and make better choices regarding their insurance needs. As insurance costs have increased dramatically in the last decade, agents have achieved a key role in planning cost saving measures for individuals as well as small businesses.

Responsibilities of an Insurance Agent

The insurance agent needs to:

• Work with clients to evaluate their need for protection
• Educate the client by explaining the various plans available and by providing appropriate cost indexes
• Make specific recommendations that suit the client's objectives and budget
• Encourage the client to act in a timely fashion to assure that the proper coverages are in place when they are needed. The agent also sees to it that accurate and complete information is provided to the insurer to make sure that the client gets the very best premium available.
• Keep in contact with the client, and periodically review or update their coverage. The agent should suggest appropriate changes, and counsel clients on ways to reduce cost. Often they will need to assist their client in reviewing the need for legal and tax compliance, and recommend other professional assistance when necessary.
• Assist with claims, answer questions and serve as the mediator in helping their clients deal with insurance companies.
• Assist business owners in communicating their benefit packages to their employees, often assisting the employee in seeing how the benefits coordinate with their personal financial programs as well as those provided by government entities.