An insurance agency, sometimes also known as an insurance brokering company, is an entity designed to provide the brokerage services of insurance. They are independent agents who are hired by insurance providers for the brokerage services they provide. They are not directly associated with any one insurance provider. They work for their own clients and set their own fees and commissions. agent has some nice tips on this.
In return for these brokerage services provided the insurance agency receives a percentage of the premium for each policy. The more policies the agency sells and the more successful they are at getting new business the larger portion of the insurance company’s profit is retained by them. The insurance agency also has the obligation to keep the policyholder informed about any changes made to the policy as well as the renewal of the policy and the soonest possible renewal date for the same. If a policyholder cancels his policy before the soonest possible renewal date, there can be a loss of commission from the insurance company who will have to pay the insurance agency for this cancellation.
There are other duties that are commonly assigned to an insurance agency. They include working with the underwriter of the insurance policy. The underwriter is responsible for evaluating the risk and value of the product or coverage provided by the insurance company. The insurance agency then provides information to the underwriter, which will help him in rating the risk and value of the product or coverage. When an insurance policy is sold, the insurance company tracks the activity of the agent very carefully so as to make sure that the right policy is being sold.