If an insured serves a notice to the broker, the same notice will not be treated as a notice to the Insurance Company. The broker shops for a company in the Insurance Marketplace in which the insured person will receive the maximum coverage at the most affordable price. There is no limitation or restriction on the Insurance Broker to do business with a particular company.
The firm that functions as a broker is called a brokerage. There are many companies working as Insurance Consultants. These companies search for the best insurance policy for the customer from a large number of companies.
For this activity, they receive a fee from the customer. An Insurance Broker also functions like an Insurance Consultant. They also try to find the best insurance policy for the customer from a large number of companies.
Nevertheless, in case of Insurance Brokers the fee is taken in the form of a commission from the Insurance Companies.
Insurance Brokers are not Insurance Companies and in case of insurance transactions, the risk is not borne by them. On behalf of customers, Insurance Brokers bargain on Insurance Policies. Usually, they deal with Casualty Insurance and Property Insurance. Insurance Brokers function like financial advisors and offer the best service and facilities they think would be suitable for the clients.
The Leading Insurance Brokerage Firms include the following:
- Aon Corporation
- Marsh & McLennan Companies
- Wells Fargo
Sometimes, the Insurance Brokers are also referred to as general agent, insurance agent, or underwriter.
Insurance Brokers also perform Insurance Underwriting for individuals.