Forex Digest

I know what a broker is but don't know what an insurance broker is and wondered if anyone knew what it kind of job it is and what requirments you need to become one? Thanks.

I have recently replied to a similar question about career as an insurance broker, but here goes.

An insurance broker is both the agent of several insurance companies (who authorise him to sell their products) and an agent of his clients (who he may advise on the type of insurance products available). This immediately causes possible conflicts of interest although the FSA are imposing standards to ensure this does not happen.

The broker may offer 'a fair market analysis' i.e. a range of products for a type of insurance, ' a limited range of products' or a single product and it is quite possible for a broker to offer different numbers of products for different types of insurance e.g. a broker may offer a 'fair market analysis' for car insurance but only a single legal expenses insurance policy. It is a condition of the FSA rules that they advise you on what basis your requirements are offered (usually found in a status disclosure or IDD document).

Insurance brokers may 'advise you' or offer you a selection of policies for you to choose. If you buy on the internet you are not getting advice and it is up to you to ensure that the policy you buy meets your needs - only a fool or an expert should buy insurance online. If the broker offers advice then they have to ask sufficient questions to ascertain your 'demands and needs' and make a recommendation based on your 'demands and needs'. You should therefore get what you need under those circumstances (which is NOT always the cheapest!)

Insurance broking was regulated by the Insurance Mediation Directive passed by the EU and regulation in the UK was undertaken by the FSA on January 14th 2005.

To become an insurance broker you need.

Expertise in the insurance products you sell. (TC)
Adequate Financial Resources. (PRU)
Knowledge of how to administer products and provide details of yourself to your customers (ICOB)
Apply for Part IV permission from the Financial Services Authority
Be accepted as agents from insurance companies
Have Professional Indemnity Insurance (SYSC)
Have client accounts to look after client money (CASS)
Treat your customers fairly (TCF) and apply high level business standards (GEN)
Be able to compete against existing insurance brokers and insurance companies and bancassurers all of which have tremendous financial resources to attract business.

I would read the FSA handbook - http://fsahandbook.info/FSA/select-handb ook/tailored/GIBRKR - to appreciate the rules we have to abide by.

In the future I can see a situation where only the better off seek advice about their insurance needs and others buy online, direct from insurers, banks and have to look out to see if the cover is suitable.

But it is a very interesting occupation - hope I have not put you off!

2007-07-01 14:07:17 by SkePt

The exciting life of the insurance broker

I am applying for insurance and my broker is a related party. I went to get tested for stds and I DO NOT want him to see that. What level of detail does he see when I provide him with Doctor contact information? What type of information does a Doctor provide?

The broker won't see the medical records directly - what they will see, are underwriting notes if your policy is "uprated" or declined - the reason for the uprating or declination.

2007-09-25 15:59:16 by Zach W

My premium was due last August which I paid to the broker. They forgot to forward the funds to the actual insurance provider and I had received a notice of cancellation. The policy was not reinstated until November 25th. They sent me a renewal notice saying I have to pay again in August. They said since it was their (the brokers) fault I would have been covered anyway if something happened (this is a commercial insurance policy). Is that true?

2009-09-02 08:27:45 by romanticman

Do i need to do some sort of course?how do i become a insurance broker?

Go to the department of insurance website for your state and find out what the rules are.

Generally speaking, you will need to have some number of years experience in the insurance industry (it may vary by state) before you can even take the brokers test. You will need to take the state license test before you are a broker. As far as I know, all states also require you to take some number of hours of approved education courses. Again, it will vary by state.

Insurance is regulated by state and they don't just let you hang a sign out and start selling insurance if you don't know what you're doing. It requires learning the business first.

2007-02-25 06:55:21 by naveed h

I have found how to become an Agent, but I want to be the Broker. Is there a time requirement as an Agent, like in Real Estate, before I can become a Broker? Or can I study and pass the exams for Insurance Broker without a time constrant. I'm pretty smart and capable, and would like to just go do it, and start building up my own business. I don't know what the Broker Exam is called. What I have found seems a little abstract. Any help?

There isn't any difference, from your point of view, in an agent and a broker. The license is the same.

You want a producer's license.

Good luck finding someone to let you sell their insurance. That's the hard part.

2007-05-22 13:15:58 by Samie