Insurance Broker vs Insurance Agent

Jakarta, Indonesia - Insurance companies have been existing since the start of time. Along with this, the dispute between insurance agents and insurance brokers has also been one of the issues. Both of the insurance salespersons have a persuasive personality, a strong aptitude for working with numbers and a desire to help others. To identify their differences and similarities, we have listed it down for you for you to fully understand their cope and limitation. This is also to keep you from doing business with fraud insurance salespersons.

Agent vs Broker

Who they work for?

Insurance Agents are employed by the insurance company to carry out the business in its behalf while insurance brokers work independently and though he sells insurance policies, he is best on the side of the client, not the insurance company.


Insurance companies such as Axis Capital gives its group of insurance agents legal authority to sell financial products of the company to people by making a contract between a person and company. On the other hand, insurance brokers are qualified people as they pass the relevant course to obtain a license to sell policies.


An agent is not an employee of the insurance company which means that he is not included in the payroll while the broker has knowledge of the financial status of many companies in the market. Beware of scams made by fraud salespersons though. They may claim to be an agent or broker.

How they earn

While insurance brokers offer a wide variety of insurance that best suits the client, agents receives commission from the company when he sells the financial product. The former assesses and reviews the needs and requirements of a person or a business and helps him with just the right financial product.

Job Permanence

Agents can have other source of income or could be doing other jobs while brokers help businesses develop specific insurance plans for the employees and then find an insurance company that accepts the plan.

Job description

Agent disseminates information about the products of an insurance company and convinces people about the need of any insurance policy. Thus a broker matches clients with insurance companies.


Insurance agents are insurance professionals that serve as an intermediary between the insurance company and the insured. Insurance brokers can be best described as a kind of super-independent agent.

Knowledge in the Field

As a broad statement of law, an agent’s liability to their customers is administrative. That is, agents are only responsible for the timely and accurate processing of forms, premiums, and paperwork. Brokers are required to have a broker’s license which typically means the broker will have more education or experience than an agent.


Agents have no duty to conduct a thorough examination of your business or to make sure you have appropriate coverage. Rather, it is your obligation to make sure you have purchased needed coverage.

Brokers also have a higher duty, in most states, to their clients. Brokers have the duty to analyze a business and secure correct and adequate coverage for the business. This is a higher duty than the pure administrative duty of the agent. However, this expertise comes at a price.

Insurance Fees

Insurance agents can be either:

  • Captive: A captive agent is an agent who works for only one company and is a “captive” of that company. He will sell policies only for that insurer.
  • Independent: An independent agent is one who works as an agent for a variety of different insurers. He can produce policies from several insurers and offer some comparisons of different insurance policies.

Brokers typically charge an administrative fee or premium payments are higher when purchased through a broker.

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