Insurance Broker Job Description, Skills and Salary
Get to know about the duties, responsibilities, qualifications, and skills requirements of an insurance broker. Feel free to use our job description template to produce your own. We also provide you with information about the salary you can earn as an insurance broker.
Who is an Insurance Broker?
The word insurance has been thrown around and used frequently of late; especially with the dwindling economies across the world due to the ongoing COVID-19 pandemic and other crises. The prices of goods and services have increased, medical bills have skyrocketed, and sustainability is increasingly becoming difficult. These and more have increased the public’s awareness of the importance of insurance. Moreover, the insurance sector is growing worldwide at a steady pace, and professionals in the industry are forming bridges that connect insurance firms and the general public.
Insurance brokerage is largely associated with brokering insurance for investments, life, car, houses, and so on. Generally, insurance brokerage is carried out by authorized individuals and organizations such as web-based insurance firms and traditional high street brokers. Insurance brokering enables companies and individuals to procure property and casualty or liability insurance, life insurance and annuities, accident insurance, and health insurance. In more competitive markets and settings, insurance brokerage significantly helps small or junior employers/workers find a different form of insurance. The process provides services that exceed procuring insurance including risk assessments, insurance consultations, insurance-related regulatory and legislative updates, and claims assistance services.
Therefore, an insurance broker can be defined as an intermediary that sells, solicits, and regulates insurance on behalf of a client or customer for compensation. Unlike insurance agents that represent one or more specific insurers under a contract, an insurance broker negotiates with multiple insurers on behalf of a client. Insurance brokers are proactive specialists since negligence on their part can have severe and devastating effects on clients when they realize their insurance coverage is worthless. An insurance broker uses his/her profound knowledge of risks and the insurance market to find suitable insurance policies and strategies to arrange cover and insurance for their clients. They broker deals with more than one insurer to ensure individuals, businesses, and companies get the best available deal.
Most insurance brokers shop around to multiple insurance companies representing their clients rather than working for insurance companies; they broker and sell insurance in the process. Some work for brokerage firms while others work independently as freelancers. When insurance brokers are hired, they seek the best insurance policy, comb through different insurance offerings from companies, and select the right match for the client. Importantly, the insurance broker considers the clients’ needs before brokering a deal; they ask questions or request documentation such as appraisals, inspection reports, or property valuation depending on the type of insurance.
Additionally, an insurance broker provides information and support services to the client after the insurance purchase process is complete. They may coordinate premium payments, make recommendations during renewal, and request policy changes on behalf of the client. Also, an insurance broker assists with the claim process as well. Most insurance brokers earn a commission on the policies or insurers they sell; the insurers usually pay the brokers a commission for their part in the deal once the client successfully purchases insurance. The commission depends on the amount paid and is negotiated between the broker and the insurer. However, other insurance brokers charge a brokerage fee that is paid by the client instead of the insurance company although this is sparsely practiced. Insurance brokers employed by brokerage firms are placed on fixed and reviewable wages and salaries. While identifying, providing, and organizing insurance cover for private clients and commercial organizations, an insurance broker considers best practices and regulations in the industry. They solicit and create complex coverage plans to provide the best services for all and sundry. Relatively, an insurance broker has plenty to keep them occupied since much of their job is client-centered.
Furthermore, insurance brokers often specialize in one area of insurance such as auto, property, or health insurance or specialize in one type of client like medical professionals or small and medium-scale entrepreneurs for example. Advantageously, an insurance broker offers a wider price and service range since they engage with multiple insurance companies. After getting a new client, the insurance broker analyses the client’s risk portfolio, prices several insurance options, and selects the policies approved through underwriting. Then, they write reports, provide advice, and update existing insurance dogma on behalf of the newly established client.
These professionals are trained to be well-versed and articulate to explain complex insurance terms to customers. Usually, an insurance broker works office hours (9 to 4) accumulating between 30 to 40 hours weekly. Relatively, an insurance broker might work outside the regular business hours when a client has an emergency or needs assistance with filing a claim outside office hours. Although the role is mainly office-based, insurance brokers may need to travel to visit clients and insurance companies at their abode. Remote work also exists for an insurance broker in many countries and localities. Thus, if you are interested in helping others find the best insurance policies for them, you may consider becoming one of the following types of insurance brokers;
Commercial insurance broker: A commercial insurance broker deals with complex insurance and high-value cover in areas such as aviation, marine, financial risks, and oil and gas.
Retail insurance broker: On the other hand, a retail insurance broker usually arranges insurance policies for individuals or companies and deals directly with them. Retail insurance brokers deal with employers’ liability and public and product liability insurance. They provide insurance policies for individuals that cover housing, travel or pet cover, and motor insurance.
Insurance Broker Job Description
Below are the insurance broker job description examples you can use to develop your resume or write an insurance broker job description for your employee. Employers can also use it to sieve out job seekers when choosing candidates for interviews.
Often, an insurance broker liaises between customers and insurance firms to solicit the perfect deal that matches the client’s insurance needs, goals, and targets. Nonetheless, the responsibility, tasks, and job descriptions of insurance brokers vary according to the size, type, and location of the employer. Large insurance companies offer more opportunities for specialization than smaller firms. An insurance broker might be needed to provide general cover on property, travel, pet, or motor in retail insurance. Conversely, you may deal with oil and gas amongst others in commercial insurance. The typical responsibilities of insurance brokers include;
- Sell different types of insurance policies available to clients: Perhaps, this is the most important responsibility of an insurance broker. Most insurance brokers source insurance policies that align with their client’s needs from different insurers. Also, an insurance broker promotes the identified products to new and existing clients, explains each point of the insurance policy, and performs the necessary paperwork to sell the insurance policy.
- Interview new clients to assess their risks when selling life or health insurance: An insurance broker investigates the background of new clients and preps the clients for medical examinations when selling health or life insurance. Next, they evaluate financial records, criminal records, or other documents where applicable and decide on the best risk-free policy available for the client.
- Inspect assets when selling certain insurance such as property or motor insurance: Vitally, the insurance broker determines the state of an asset such as a vehicle or building before selling insurance to look for signs of previous damage. Also, assets inspection is aimed at assessing possible risks arising from the location of the property, current state, and mileage. Afterward, they consult with an insurance adjuster and other experts to determine the most appropriate insurance policy.
- Ensure all policy requirements are met: Requirements and necessities are important in brokering insurance. Therefore, all insurance brokers ensure the client meets all requirements for insurance. They verify and make sure all paperwork or documents are signed and completed accordingly. This is done under strict adherence to regulations and guidelines.
- Customize or create special coverage packages for clients: The clients’ satisfaction is essential in insurance brokerage. Thus, the insurance broker creates an alternative or coverage plan that satisfies the clients’ general needs using different plans from different insurance companies.
- Calculate premium plans, methods, and premiums: The insurance broker considers all costs and coordinates payment arrangements with the corresponding insurance company. Since they serve as liaisons or intermediaries between their clients and the insurance firm, they are responsible for processing payment transactions as well.
- Perform administrative tasks: Like most occupations or professionals, an insurance broker performs some administrative tasks for the employer. They keep records of all clients, contact clients when there are issues with payments, keep records of all transactions, and coordinate policy renewals with the insurance firm.
- Handle insurance claims: Also, an insurance broker collects information on the client and policy coverage, explains the terms of coverage, assists the client during the claim process, and monitors the claim to ensure equitable payments.
- Schedule and attend meetings: Since an insurance broker works with both private clients and commercial organizations, it is his/her responsibility to schedule and attend meetings with either the insurer or their clients, or both to assess the current and future insurance needs of the clients.
The insurance broker can be licensed in several policy lines such as health, life, property, or casualty insurance. Formal training and other qualifications are required for an individual to practice. Each country, state, or location has specific qualification requirements for an insurance broker. Nevertheless, the basic steps and general requirements are the same and include;
Age and background check: The insurance sector requires an individual to be at least 18 years old and be free of felony, fraud, or any legal charges to apply. The ideal candidate must not owe federal or state income taxes. Therefore, you must pass a thorough background check completely to be considered for employment.
Education: A high school diploma or Bachelor’s degree is required for an insurance broker position. A degree in a business /management or numerical course is accepted by most employers. Courses can either be economics, international business, statistics, mathematics, accounting, finance, or business management. In relation, a postgraduate degree in insurance and risk management is an advantage.
Experience: Relevant banking and insurance experience gained through an internship and work placements are useful. Some employers prefer candidates with previous work experience in the sector. Also, experience gained from roles in marketing, advertising, job shadowing, and apprenticeship can suffice.
Additional certification: Alongside educational degrees, employers tend to favor the candidates with professional certifications. Such certificates demonstrate and show the applicant’s zeal for professional growth and development and include the risk manager and financial planner certificate, and service representative and consultant amongst others.
License: An insurance broker must possess a federal or state license to practice. The requirements for licensing are outlined and enumerated by relevant bodies in countries. Licensing is compulsory for employment as an insurance broker.
An insurance broker has plenty to keep him/her occupied daily. Much of their tasks are centered on the client; they assess the client’s insurance needs, advice them based on their circumstances, and choose the best policy available. Moreover, brokering insurance is an essential cog or responsibility of brokering firms. Thus, anyone thinking of starting a career in insurance brokerage must possess some skills and qualities to properly fit into the sector. These essential skills help the broker to work efficiently and carry out unique activities effectively. Insurance broker skills include the following;
- Numeracy and mathematical skills to accurately work with and navigate through numbers.
- Proficient negotiation skills to reach a middle ground and draft agreements between clients and the insurers.
- Outstanding customer service and sales skills to deal with difficult and cooperative clients.
- Exceptional communication and interpersonal skills
- Excellent time management and organizational skills.
- Tremendous problem-solving and decision-making skills.
- An adaptive personality with the ability to learn and apply new sales strategies quickly.
- Ability to be energetic, resourceful, structured, goal-oriented, and proactive.
- Analytical reasoning to evaluate different options of insurance policies and recommend the best one possible.
- Business acumen and commercial awareness.
- Flexibility, teamwork, and computer skills.
How to Become an Insurance Broker
To become an insurance broker, an individual must follow a set of guidelines and steps that encompass educational and licensure requirements for instance. Hence, if you are interested in helping others find the best policies for them, learn more about this career path and consider the following tips;
- Decide on education and earn a bachelor’s degree preferably.
- Choose a specialty such as health, life, property, or motor insurance.
- Add an internship to your insurance broker training repertoire.
- Meet pre-licensure requirements, pass the licensing examination, and qualify for a license to practice.
- Obtain an insurance broker license
- Consider a higher apprenticeship and explore entry-level positions.
- Pursue and obtain an additional insurance broker certification
Where to Work?
Vacancies in insurance brokerage are advertised by recruitment agencies and career services, print and audio media, and online. The majority of insurance brokers are employed by insurance brokering firms ranging from small niche companies to large multinational insurance and financial advice firms. Similarly, an insurance broker can work for the following organizations;
- Reinsurance companies
- Insurance risk management departments of non-insurance companies
- Insurance companies
- Private practice.
Insurance Broker Salary Scale
Most employers provide performance-related bonuses and perks in addition to salaries depending on the track record and success of an insurance broker. Also, the salary structure depends on the level of experience, location, and/or the enterprise. Therefore, the average salary of an insurance broker is $39,496 per year or $20 per hour. Entry-level insurance brokers receive $28,000 annually while experienced insurance brokers make $55,000 yearly.