The definition of broker traditionally refers to a person or entity that acts with respect to a customer or client which is known as the principle. The broker uses their knowledge and expertise to advise the client on certain decisions usually related to purchasing and trading. The broker can either play an advisory role or can also have complete purchasing and decision making power in order to act with respect to the client or principle.
The absolute most commonly found type of brokers are investment brokers and commodity brokers. Individuals who desire to invest their money and trade in commodities seldom have the data and time to handle their investment portfolios closely so they really employ brokers such as these who have much more insight and expertise to do something on their behalf. You will find however many other styles of brokers who offer people using their inputs of knowledge and expertise. Other samples of brokers include business brokers, Forex brokers, real estate brokers, insurance brokers and many more.
The definition of insurance broker is however an extremely vague one. In the past insurance brokers were the same as any broker, but focusing on insurance policies. Versicherungs Makler Kassel They would act with respect to the principal/individual who employed them in order to investigate various insurance options from various insurance companies in order to secure the best deals for the principle, in addition to help interpret certain formalities within insurance contracts. A trend eventually developed by which insurance brokers didn’t necessarily lookout to discover the best interests of the principle and would favor certain insurance companies. In fact many insurance companies posed as brokers in order to obtain the preference of deceived and uninformed individuals. Consequently, the definition of insurance broker has resulted in one with a much broader meaning. Today an insurance broker is essentially regarded as any person who acts as an agent to insurance with respect to the principle, aside from perhaps the agent is acting in the interest of the principle or in the interest of a specific insurance company.
In reality the definition of insurance broker is hardly ever used to reference an agent who’s hired by individuals seeking the best insurance offers. Today it is more accurately placed on employees of insurance companies who represent the clients of this company. Insurance brokers still represent insured individuals, but rather they’re hired by the insurance company itself to deal with the claims, legalities and transactions involving the insured and the insurance company. Therefore most brokers represent only 1 insurance company and act in the interests of the insurance company which they represent. The broker essentially acts being an intermediary which communicates the interests of the insured to the insurance company, manages the procedures of coverage and ensures that the insurance contract is adhered to.
To conclude, the existence of an broker is very necessary to both insurance company and the insured individual, while they insure that neither party breaches the insurance contract and be sure that procedures are followed. The insurance broker also helps it be easier for insured individuals to communicate their interests to the company and successfully make claims should the necessity arise.