Brokers VS Sales Agents: What’s The Difference

broker vs sales agent

Do you ever buy a insurance? If so, then you may have connections with theinsurance world. It is a vast profession that includes different terms that they use to work in their own space. Similarly, brokers vs. sales agents are two different terms in the insurance profession.

Moreover, if you are starting an insurance brokerage, you may interchangeably use the broker vs. sales agents. Keep in mind that the requirements of a broker and sales agents are entirely different. First, you should know the requirements of becoming an agent? It will also help you determine the difference between these two terms.
However, if you are new to the insurance business, this guide is for you. Here we will share the critical differences between broker Vs. sales agents that help you understand it in better ways.

Insurance Broker vs. Sales Agent

Both are the titles of insurance professionals and also look similar. The primary difference between both is about the licensing and experience of a person. An agent is a person who has a license to sell the insurance in their state. At the same time, the broker has the license to own their insurance business. Keep in mind that the insurance broker can not work independently as they need to work under a broker to sell the insurance in their state.

Both these terms overlap and have different rules to deal with customers. If you are starting your insurance brokerage, it is also essential to build a relationship with the sales agent. Moreover, the requirements for becoming an agent differ regarding the license and selling process.

Now it is mandatory to go through the definitions of insurance sales agents and brokers to understand it more.

What is a sales agent?

When a general person learns about the insurance profession, the sales agent is the first term that they come to know. However, the primary requirements for becoming a sales agent are to meet the clients, host open houses and perform the selling process.

As we already said, the sales agent has the license for selling the insurance. The sales agent needs to get the classes and pass the relevant exams for working in the insurance field. They can legally sell the insurance by working under the broker who has the license to own their insurance. Remember that an agent can not work independently and needs a broker to work effectively.

What is a broker?

A broker is an individual who has a higher rank than a sales agent. The individual broker will get the license by getting further education and passing the relevant exam. Once a person fulfills the requirements of becoming a broker, they can sell the insurance or start a brokerage firm where they can hire a sales agent.

Brokers have more freedom of work and build a solid business path. Moreover, they have different opportunities to work, including working independently, hiring other insurance brokers, and some others. They have open-door opportunities as compared to the sales agents.

If you are also starting an insurance brokerage business, it is essential to know these terms. We hope this guide will help you understand it well.

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