What is an Independent Insurance Agency?

What is an Independent Insurance Agency?

An Independent Insurance Agency is not limited to writing insurance policies with one insurance company, but can shop multiple insurance companies and find the best price and coverage for their customers.

What is a Captive Agency?

A Captive Agency is limited to one insurance company.

What is the difference between an Independent Insurance Agency and a Captive Agency?

The difference between an Independent Agency and a Captive Agency is an Independent Agency can provide quotes from several different insurance companies; however, a Captive Agency can only provide one quote from one company.

For example, Tom and Sarah have insurance with a Captive Agency (State Farm, Allstate, American Family, etc), and they just received their renewal bill. Their policy premium increased over $100 from last year. They call their agency and asked for a quote from another company. The Captive Agency cannot help them because they can only sell that one brand of insurance (State Farm, Allstate, American Family, etc.).

 Now let’s use the same scenario, but this time Tom and Sarah are insured through an Independent Insurance Agency. Tom and Sarah receive their renewal premium and it has increased over $100 from last year. They call their agency, and the agency quotes the policy with several companies to find the best price and company for Tom and Sarah.

The advantage of doing business with an Independent Agency is that they do the insurance shopping for you.