Choosing an insurance broker
Hiring an insurance broker could be the smartest insurance choice you make, or it could be a futile exercise. Many factors play into whether your insurance broker will offer you value for money. Sometimes brokers can save you money, and sometimes they can end up costing you more than you would have spent without hiring them.
Some brokers can save you time, lower your stress, and increase the efficiency of your insurance experience. It pays to know what your broker should be doing and offering you to help you decide if you need a broker and which insurance broker in the Western Cape would be the best for your needs.
What to expect from a good insurance broker?
Brokers receive a percentage of your monthly premium as commission from insurance providers with whom they have an agreement. The percentages are limited according to law, but in return for this payment, the broker is expected to help you sign up for the plan and then to offer you continued services.
In terms of work done for you, here is what you can expect your insurance broker to do:
● Find insurance plans that meet your needs and fit your budget.
● Discuss insurance options and your concerns candidly.
● Find or arrange bundled insurance solutions that give you the best of multiple plans.
● Give you honest feedback about the negatives of plans they’re offering.
● Give you advice and insights when you have questions about a plan to which you signed up through them.
● Help you communicate to the insurance provider for queries, problems, applications, and more.
● Help you with claims processes.
● Fill in forms for you, where necessary.
● Regular contact from your insurance broker with advice, insight, and changes you need to be aware of.
You are the broker’s client and not the insurance provider. As such, the insurance broker should negotiate with the insurance company on your behalf when it comes to disputes, claims, and any issues you may be struggling with. This kind of continued work that they should offer you is part of what makes an insurance broker worthwhile for their customers.
What to consider when choosing a broker
Not all brokers are the same. Some will do more for you than others, some are more experienced, and some are more reliable. How can you be sure you are choosing the right broker for your needs? Below are a few points to consider:
- Consider broker fees
Some brokers charge a fee for their services. South African brokers receive commission from insurance providers, which sometimes means they do not charge a fee. Whether or not they charge a fee can determine whether you end up saving money in the deal. No fees would, of course, be better.
South Africa’s laws obligate insurance brokers in the Western Cape to discuss their fees upfront and not to do work on behalf of their clients without written agreement to the fees by said clients. If the broker you are considering hasn’t mentioned fees, you can ask them outright whether they charge any extra fees.
- Consider which schemes they are contracted to
Insurance brokers in the Western Cape generally have agreements with insurance companies. They are contracted to schemes from the providers. There are 23 known schemes in the country, but it is highly unlikely that a broker will be contracted to them all. You do, however, want a broker who is contracted to more schemes rather than less, broadening your options.
- Determine their reliability
Having a broker who is reliable can make a massive difference. A broker who doesn’t prioritize your interests may cost you more than they save you. Determining the reliability of the broker you are considering is, therefore, extremely importance. You can find out whether they are reliable by looking for reviews of the broker online or from getting a reference from someone you know.
- Consider their experience
A broker’s experience is invaluable for their clients. Look for an insurance broker who is willing and eager to offer advice, tips, and insights into the industry. Because an insurance brokers’ advice is so valuable, they are sometimes called insurance advisors. Ask the broker you are considering working with for case studies and their experience in the field.
- Consider their qualifications
Another way to determine the reliability of a broker you are thinking of working with is to inspect their qualifications. Are they licensed as a financial services provider and registered with the Financial Sector Conduct Authority? A reliable insurance broker will be more than willing to show you their qualifications.
- Consider their field of expertise
Different brokers work with different kinds of insurance. A broker who typically works with medical aid will not be very helpful when it comes to business insurance, for example. Before you hire the broker you are considering, confirm their field of expertise.
You can sometimes also save money by finding insurance quotes yourself online. Insurance providers in South Africa make it easy for customers to find insurance quotes and compare plans without a big fuss.
Information quoted is correct at the time of publishing this article. The information in this article is provided for informational purposes only and should not be construed as financial, legal, or medical advice.