There are many reasons why you need to have insurance. For example, in most states, including Wisconsin, you must have a minimum liability coverage for your vehicle. If you still have a loan on your car, the financial institution that carries your loan will also require physical damage coverage. If you have a mortgage on your home, your loan provider will require you to purchase a certain amount of homeowners’ insurance. Most recently, the passage of the Affordable Care Act requires you to have acceptable health insurance.
Insurance isn’t just a requirement, it’s a good idea in general to protect your assets from misfortune. This article is will show you three distinct ways you can go about buying insurance. How each way could affect what kind of coverage you end up with, and how much it costs. Read on to learn the three major ways to buy insurance.
Directly from the Insurance Company
When you buy insurance policies directly, you won’t have an agent. You select the policies you want to buy and purchase them from the insurance company directly, either through their website over the phone. Because you don’t have an agent, there no one acting on your behalf to advise you on what is available or what types of policies you should buy. When you purchase insurance directly from a carrier, your only options are the policies that particular company offers. Though there are real people doing the underwriting and processing the claims, you likely will never communicate with the same person more than once. Examples of popular direct insurance providers include GEICO and Progressive.
Through a Captive Insurance Agent
A captive insurance agent will provide professional advice on your coverage needs and options, but you are still limited to only those policies that are offered through the specific company he or she represents. Captive agents can give you customized service for your needs, but they don’t always represent your interests, but rather the interests of a single insurance provider – hence the name “captive”. If you want or need coverage options that aren’t available through the company they represent, or if they can’t provide coverage due to an underwriting rule, you will have to seek out another provider to get the coverage you need. Though captive agents may offer competitive prices on some policies, that could change if your insurance needs change, such as if you get married or divorced, add a new driver to your policy or have to file a claim.
Through an Independent Agent
Independent insurance agents also provide personalized service to help you get the coverage you need, but they are not “captive” to just one company. Independent agents represent numerous insurance companies and can act like a broker, offering you a range of coverage options to suit your individual needs. They offer several price quotes for each type of insurance you require, giving you the chance to buy the most coverage for your budget.
Benefits of Buying Through an Independent Insurance Agent
After reading the three descriptions above, you could probably see that working with an independent agent is probably the best option for buying insurance for most people. The personalized service helps you get just what you need, compared to buying direct or through a captive agent. You will also likely find an independent agent very near to where you live, including right here in Madison, Wisconsin.
Independent agents will help you to discover potential liabilities that could put you at risk should something unexpected happen, explain how to cover them, and recommend suitable coverage amounts. Because they have developed relationships with a range of insurance providers, they can review numerous policies and costs to reveal the best one to fit your coverage needs and price points. For this reason, when you buy from an independent insurance agent, you’ll likely save money compared to a captive agent or buying direct. Most significantly, an independent agent isn’t obligated to any one insurance company – they’re there to work for you, and fight for your best interests.
Additionally, when you work an independent insurance agent, they likely offer policies that can fulfill all of your needs. This is because they work with so many different insurance companies, they can provide a greater range of policy options. That includes personal insurance from auto, home and life insurance; to business insurance such as workers compensation and disability. As your life changes and insurance needs evolve, such as when getting a dog, getting married, having a child, or buying a home; they can help you adjust for the additional coverage you’ll need.
Though there are more ways than one to purchase insurance, some are clearly better than others. Instant online quotes are convenient, but it isn’t nearly the same as the personalized advice and service that independent insurance agencies can provide. You don’t need to spend a lot on insurance, you can get the coverage you need at a reasonable price. That’s what you can expect when you work with an independent insurance agent.
