If you speak with family, friends or do a quick Google search, you’ll learn pretty quickly that you can get insurance without an insurance broker. However, what you miss out on is having an insurance expert in your corner. They’ll take the time to understand your needs and finds the best coverage for you at the right price!
When you’re in the market for car insurance, knowing who to ask for advice is an important step in the journey. Choosing the right insurance broker can make a huge difference in the type of service you get and the choices you’re offered.
Read on to find out what an insurance broker is, the services they provide and how to choose the right one for you!
Why do you need car insurance?
Car insurance offers protection against financial loss in the event of an accident or theft. It’s an agreement between the insurance company and the car owner. The car owner pays premiums that could go toward a claim the insurance company will cover in the event of loss or damage to the car.
Everyone in Canada must carry basic car insurance, which varies across the country. The most common types of car insurance coverage include:
- Liability coverage – liability coverage is a mandatory coverage pays if you injure someone or damage someone else’s property with your car and they make a claim against you or sue you.
- Accident benefits coverage - This pays for your rehabilitation and medical expenses and provides you with replacement income (subject to limits) if you are injured in a collision. Each province or territory has its own limits and rules on accident benefits coverage.
- Direct compensation-property damage coverage can cover you financially if another vehicle hits you and you are not at fault.
- Uninsured automobile coverage can protect you financially if you are injured in a hit-and-run accident or by an uninsured motorist.
In addition, you can purchase coverage for:
- Collision – This pays for losses or damage to your car caused by a collision.*
- Comprehensive – This pays for losses or damage to your car caused by something other than a collision (e.g., fire, theft, vandalism).
Other optional coverage is also available, including:
- Loss of use coverage, which pays for a rental car if your car is damaged in a collision and is being repaired.
- Waiver of depreciation for new vehicles
* This coverage is mandatory in Manitoba and Saskatchewan - you must buy first party coverage for damage to your car.
What does an insurance broker do?
Most insurance brokers specialize in different areas – for example, home and auto insurance, business and commercial insurance, and life insurance. An insurance broker is an expert when it comes to coverage for their area of expertise. Whatever you need insurance for, it’s in your best interest to work with a broker who understands your needs, does their research and provides you with the right coverage tailored for your unique situation.
A personal insurance broker can help you shop for a car insurance policy by comparing quotes from multiple car insurance companies. Your broker can also help you decide which kinds of additional coverage to purchase and how much coverage you need. Once the broker compiles all of this information, they submit it to the insurance companies they work with. They’ll get a range of car insurance quotes, which will be presented to you, along with their recommendation.
What are the different kinds of insurance brokers?
The insurance broker you choose can make a big difference in the type of service you get and the choices you’re offered. Here are some options:
- Independent Brokers:
- Independent brokers can offer products from many insurance companies. This helps them better serve your interests, as they can review multiple options to find a policy and rate that’s right for you.
- Insurance rates vary from company to company. Independent agents can put together a customized insurance plan.
- Captive Brokers:
- Also known as captive agents, these brokers work with a specific insurance company, and as part of their business agreement with that company, they can offer only that company’s insurance products.
- They may be able to sell other products from the company they represent, such as annuities and investment plans.
An independent broker can help you compare rates across multiple insurance companies and choose the best policy for your needs, without bias. As a captive agent works for a single car insurance company, they may have more detailed information about one company’s products.
Insurance brokers vs. Insurance agents
What’s the difference between an insurance broker and an agent?
| Insurance Brokers |
Insurance Agents |
| Represent you |
Represent the insurance company |
| Works with multiple insurers |
Works exclusively with one insurer |
| Helps you shop for the best policy from all the insurance providers they represent |
Tied to the providers with which they work |
| Cannot complete insurance sales |
Completes insurance sales |
Advantages of using an insurance broker for car insurance
An insurance broker can present you with multiple car insurance quotes from different insurance companies so you can compare them all at once. Here are more key benefits of using an insurance broker for your auto insurance policy:
- Experience - Brokers know how to deal with claims and can guide you through the process, answering any questions that you have along the way.
- Expert knowledge - Brokers earn additional education credits each year, to ensure they stay up to date on the latest developments in the insurance industry so they can offer the best advice and knowledge.
- Privacy protection – Brokers keep all customer discussions and information completely confidential.
- Local service for all your needs:
- Most brokers are local and can recommend the best coverage for you based on your situation and location.
- Your local insurance broker can offer the best options available from their portfolio -which usually includes home, auto, business, plus coverage for your boat, RV, cottage, life insurance and more.
With the right car insurance, you'll enjoy peace of mind knowing you have the coverage you need.
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FAQs about Do I Need a Broker For Car Insurance?
How much does it cost to use a broker for car insurance?
Using an insurance broker is free! Advisors receive commission on the premium you purchase and don’t worry - the commission is included in your premium, so getting a policy through a broker doesn’t increase your premiums.
An insurance broker works with multiple insurers. It doesn't matter which insurer you pick. A broker is on your side and will help you consider all of your options, so you can make a choice tailored to your individual needs.
How do you choose the right insurance broker?
Finding a reputable and qualified insurance advisor can be the difference between having appropriate coverage for your car in the event of a claim, and being stuck with a huge bill after the fact.
Keep these tips in mind when choosing the right car insurance broker:
- Ask for referrals and check references
- Determine the coverage you need
- Learn more about their specialized experience
- Consider more than the price, take a look at the overall fit
- Ask for personalized advice based on your individual needs
