Agent Directory

Captive Insurance Agents vs. Independent Insurance Agents—What’s the Difference?

In the auto insurance business, there are two primary types of agents: captive insurance agents and independent insurance agents. And though both agent types share a common goal—providing you with insurance—there are some notable differences.

Captive Insurance Agents

Captive insurance agents work exclusively for one insurance company and are obligated to drive business only to that company. Captive insurance agents must sell the product their insurance company offers in order to earn a commission.

Insurance sales agents know that consumers trust large, well-known insurance companies, and most prefer to work for an insurance company that will improve his or her sales.

Independent Insurance Agents

Independent insurance agents have no exclusive relationship with any one insurance company. They work on behalf of the client to find the best rate and coverage from a wide range of insurers. Both car insurance agents and car insurance brokers earn commissions for selling policies, though their compensation packages can be structured somewhat differently. Insurance brokers may also charge a brokerage fee as set forth by state law.

Pros and Cons of Independent and Captive Insurance Agents

When deciding which type of insurance agent best fits your needs, there are pros and cons to consider. For instance, an independent insurance agent may offer a wide range of products from multiple carriers and will be able to offer you a variety of plans and prices, but you may not be as familiar with some of the companies they work with. A captive insurance agent may have a closer relationship with a carrier you already trust, though you will not have as many options to consider.

As you can see, captive insurance agents and independent insurance agents differ in many ways. But in the end, finding a well-rounded insurance policy at an affordable rate is what matters most to consumers. If you’re looking to find insurance agents in your area, LocalInsuranceAgents.com has you covered.