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What Is a Health Insurance Broker – and What Does a Broker Do?

November 27, 2018   |   by Staff Writer

 

A Health Insurance broker – sometimes called an insurance agent – is a licensed professional who works with individuals and businesses to help them shop for and compare insurance policies. You can focus on Health and Life insurance or Property and Casualty (P+C) Insurance, or earn multiple licenses and offer a variety of coverage to your clients. Beyond sales, the life of an insurance broker includes service to customers after the sale related to claims, administration, and annual renewal.

Individuals are often attracted to insurance sales because it offers those without a lot of experience the opportunity to quickly learn the industry and earn a potentially large paycheck. Health Insurance, especially, is something people need, but may not really understand. So, individual consumers and business owners often seek the advice of an insurance professional when making a purchasing decision.

Insurance sales is also attractive because of the flexibility it offers you to be your own boss, set your own hours, and drive your own success and income.

 

What You’ll Be Doing

A lot of your work as an insurance broker is focused on prospecting and sales, but customer service and retention are important, too, especially for group sales. After all, you want to be invited back to your client’s worksite next year for renewal.

 

Captive or Independent?

A “captive” insurance agent is one who sells only one insurer’s products. For example, someone who represents State Farm or Allstate is typically a captive agent. They are generally prohibited from selling products from another company. An independent broker is one who sells coverage from a variety of insurers. The choice is yours, but you may find being independent increases your potential income, since you have access to a broader portfolio of products and services.

 

If you’re an independent broker, you:

  • Get to set your own work schedule
  • Work when it is convenient for you
  • Work where you want – meeting your clients at their office, over lunch or dinner in a restaurant, or even on the golf course
  • Have time for your family, your friends, and your life

 

Many independent brokers – and agencies – find it advantageous to partner with a General Agent (sometimes called a General Agency or GA), which can offer you added back-end support and other services. And, contrary to what you might think or have heard, you don’t pay anything for the services of a GA. Nor does using a GA cost you in reduced commissions or bonuses. Your commission and bonus eligibility are the same whether you use a GA or not.

A GA can provide you with access to a larger product portfolio, innovative sales tools, an online quote engine, and in-person and online enrollment assistance. Read more about all we can help you with at our Broker Aid page.

 

Listening and Selling

As an insurance broker, you need to be a good listener. That way you can tap into what your prospects and clients tell you about what they want, need, and can afford, including specific doctors, hospitals, or medications your clients want to be included in any plan they might consider.

In a year, when it’s time to renew your clients’ coverage, you’ll meet with them again and talk about what’s changed as far as available plans and “what’s covered,” and discuss whether it makes sense for them to renew the coverage they currently have or make a change in carrier and/or plan.

 

Attracting New Business

To generate new business leads, you will want to network with others and create an online profile for your business. You may want to create a “lead sharing program” with another broker who is focused on another type of business. For example, if you are a “Life and Health” agent, you may be able to exchange leads for P+C with a broker focused on that niche. As far as establishing your online profile, you can do this through email, direct mail, and social media.

Your GA can likely offer assistance to help you, too. Word & Brown offers a variety of tools to help you learn more about the industry, develop a business plan for your agency, map out your marketing strategy, enhance your networking, and much more.

 

Customer Service

Providing ongoing, quality service to your clients is important – before, during, and after the sale. If you keep your customers happy, they are more likely to renew their business with you and offer your name to others who make be seeking a broker.

 

What You Can Make

As a broker, you earn a competitive commission on every sale you make. You are paid every month, as long as you keep your customers happy . . . and that could be years. Plus, there are opportunities and incentives throughout the year from the Health, Dental, Vision, and other plans you sell.

If you’re driven, the reality is your income potential is unlimited.

 

How to Get Started

As we mentioned, selling Health Insurance (or any kind of insurance) requires a license. The type of license required varies by state. In California, there are more than two dozen license types. In Nevada, there are nearly 20 types of licenses. The insurance you want to sell – and your role and work situation – will determine the license you need.

 

It is rare to find a job that pays well and offers you the opportunity to help others. Working as an insurance broker is one such role. Act now to learn more.

 

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