Buying insurance can feel deceptively simple — until you realize just how many ways there are to do it. From online forms to local agents and independent brokers, the choices can be confusing. Each option comes with its own pros and cons, and making the wrong choice could mean overpaying, being underinsured, or having no advocate when you need help the most.
In a recent episode of Insurance Hour, host Karl Susman — a 30-year insurance veteran — broke down the three main ways to purchase insurance and what consumers should know before making that decision. His insights highlight the nuances of each path and remind us that the right choice isn't always the cheapest one, but the one that fits your situation best.
Susman begins with a simple framework: there are three primary methods of buying an insurance policy:
Buying directly from the insurance company
Working with a captive agent
Working with an independent broker
Each of these options can lead to the same end result — an active policy — but the experience, cost structure, and level of advocacy differ dramatically.
In the digital age, more consumers are going straight to insurers' websites or call centers to buy coverage. It's fast, convenient, and appeals to those who prefer handling their own finances. But, as Susman points out, "direct" doesn't always mean "better."
How it works:
You contact the insurance company directly — typically online or over the phone — to get a quote and purchase your policy. In the old days, Susman jokes, "you'd even get a quote form in the mail, fill it out, check a few boxes, send a check, and wait for the policy to come back." Those days are gone, but the idea remains the same: you're dealing one-on-one with the company itself.
Advantages:
No middleman: You're dealing directly with the insurer, which can simplify communication and minimize misunderstandings.
Speed: The process is usually fast and efficient, especially for standardized products like auto or renters insurance.
Disadvantages:
