An insurance broker is a person who acts as an intermediary for several insurance companies, without being exclusively linked to any of them, marketing insurance contracts to his clients in order to obtain a commission for this sale. In the English-speaking world he is known as a broker.
The qualification required to practice as such can be obtained by passing the examinations held.
Each state or country establishes different rules to be able to start up a brokerage. Example are:
- to take out professional liability insurance for insurance and reinsurance intermediaries to cover possible damages caused to clients as a result of poor management or advice;
- to demonstrate economic capacity to perform their functions; to present a business and personnel training plan that is approved by the relevant organisation;
- either to register with the Social Security as self-employed or to set up a brokerage company (a company whose main purpose is the commercialization of insurance).
Unlike the exclusive agent, who is contractually bound to a single insurance company and works for it, the insurance broker offers several advantages.He can market the products of any insurance company, working for the policyholder and representing him before the insurer. He can act on behalf of his clients by canceling policies (with the express authorization of the policyholder) or transferring them to other insurers, and he directly manages his clients’ claims, also with the authorization of the policyholder or insured.The insurance broker can also act on behalf of his clients, with the authorization of the policyholder or insured.
