9/5/2021 0 Comments Insurance Agents - Do You Have What It Takes To Be An Independent Insurance Agent? Independent insurance agents, often referred to as independent insurance sales representatives or "business agents", typically sell a wide variety of different insurance products and insurance policies, such as property insurance and personal injury insurance. The insurance carrier agreement represent the policies and encourage consumers to select their preferred policies. In many instances, independent insurance agents work with the same insurance company that underwrites the policies. However, in other instances independent agents are independent and work for themselves, collecting premiums and commissions on a percentage of the policies sold. Whether representing themselves as a sole proprietor or as an employee of an insurance company, the independent agent must clearly understand the policies, gather the necessary information for an effective campaign, compile and submit the appropriate forms, report to the insurance company, meet with customers and answer any questions about the product or policy. Insurance agents must be properly licensed and bonded in order to practice in all 50 states. Most state constitutions provide protection against self-employment suits. Some states even specifically define the duties of an independent insurance agent, including having honesty, integrity, knowledge, and compliance with law. Generally, insurance agents must be member members of professional associations such as the National Association of Insurance Agents (NAA). To become a full-fledged member of a professional association, however, an independent agent must pass a thorough background examination as well as undergo a thorough interview process with the NAA's board of directors. Becoming an independent insurance agent also means that one must have strong business relationships and be aware of what is happening in the market. Insurance industry publications, websites, and news feed related to the insurance industry are some of the sources of business-related information that agents should become familiar with. While working with a single company does give one a unique advantage, several companies offer great benefits and perks that allow agents to be successful working with several companies. A good independent agent will find at least one company that will offer the type of coverage he or she needs, whether that is through multiple companies or through one company's products. In addition to developing good business contacts and obtaining various insurance companies' quotes, independent insurance agents must also develop a solid understanding of their clientele. This means understanding one's own customers, their insurance needs, and how each customer uses the insurance coverage. This means being able to decipher between honest customers and fraudulent customers, between high risk clients and low risk ones, between potential customers and current customers. Understanding one's own customer base will help agents target the customers most likely to purchase policies from that agent. In addition to knowing their own clientele, independent agents must also be familiar with the laws and regulations that govern them. These laws can vary among different states, although most regulate insurance sales and use of insurance advertising and sales materials. While there are many similarities between the rules governing independent insurance agents and those governing traditional agents - such as being bound by FICO score determinations - there are also important differences, particularly with regards to the state rules regarding the sale of insurance policies. Explore more info in relation to managing an independent independent insurance agency here. In general, independent agents are not permitted to sell insurance policies in the same manner that traditional agents are. They cannot represent more than one company or can hold more than one office. They can not engage in the same practices that traditional agents (such as forming sales alliances with other insurance companies) are permitted to. They cannot charge high commissions or fees or offer discounts to clients who purchase policies from their agents. Finally, they cannot engage in any other practices that would break the law or violate the terms of their insurance policies. You can get more enlightened on this topic by reading here: https://www.encyclopedia.com/economics/news-and-education-magazines/insurance-agent-and-broker.
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