Generally speaking, there are two different ways that insurance is sold and serviced:
- Online carriers whose sales/service personnel (usually telephone operators) are employed by only one company; and “captive” agents* who, like employees of online carriers, also work for only one company, or;
- Local independent agents who represent (but are not employed by) more than one company.
Understanding this difference is key to knowing who you can trust. For example, regardless of expensive advertising or attention getting “too good to be true” promises, an online company’s telephone operators can only offer you one choice. And, since they are compensated based on whether you buy from their employer, they will try to sell you that policy whether or not you save money, and, perhaps, whether or not it’s right for you. This means, for example, if you demand another choice, one with a lower price, online companies cannot offer you policies from another company with better discounts.
Conversely, an independent agent who represents a number of companies can tailor coverage from a number of sources, including state-run Citizens Property Insurance Corporation (Citizens). And…they can often obtain other discounts available for your other exposures like auto, boat, or personal umbrella—thus, lowering your total premium for all three. This unique coverage and pricing flexibility, combined with local accountability, is simply not available from online companies that only sell property insurance.
IT’S WORTH REPEATING: personnel with online companies are “employees” who, like captive agents*, are unable to offer you anything other than what their “employer,” the insurance company, sells. Independent agents, own their own business, are not insurance company employees, and are not “locked in” to one company or product. And, because they are licensed in Florida and members of your local community, they have a stake in your long-term satisfaction.
*Some agents for direct writer companies (like State Farm), are called “captive” agents because they technically are not employees, but they still can only sell for the one voluntary market company with which they are “exclusively” appointed.