We Answer Your Questions | Insure Online

An insurance broker is a business or person who specialises in insurance and risk management. Brokers provide advice to clients and source insurance for them. Brokers act for their clients. Sometimes an insurance broker will sell insurance for a single insurance company. When they do this they are working as an agent for that insurer, selling their products. They are not acting as an agent for their client. A broker should always explain when they are acting as a broker for you or acting as an agent for an insurance company.
Because general insurance companies offer so many products and options, it can be quite difficult to choose the right policy. Many insurance companies offer products to insurance brokers only. The only way to obtain these products is to buy through an insurance broker. An insurance broker can help you understand the details of a policy. They can work out what level of cover you need, so that your business can be properly protected. Brokers can find you a good deal on insurance because they have a thorough understanding of the insurance market. They can explain your policy to you and advise you if there are any special situations you need to know about. If you need to make an insurance claim, your insurance broker can assist you through the process and will communicate with the insurer on your behalf.
Insurance brokers earn income from three main sources. They get to keep a percentage of the premium you pay (before they have to pass the remainder on to the insurance company) - that's commission. This can be as much as 30% of the premium you pay. They often charge a fee to their customers - that's a policy administration fee. They can invest the premiums you pay them for up to 80 days - that's investment income. You are entitled to ask your broker to disclose ‘remuneration’, ‘material interests, relationships, or associations’ and they must disclose this to you.
When you pay for your insurance, we need to collect payment through our bank's secure payment gateway. We are charged a fee for using this service. We have also invested in secure and sophisticated technology and pay a fee to our software provider each time we perform an insurance transaction. Our fee of $39.95 covers these costs and is lower than that charged by most insurance brokers.