Auto Insurance Brokers: Should You Use One?

An insurance broker could be a valuable subject-matter expert for your auto insurance search.

Miranda Marquit
Miranda Marquit Insurance Writer
  • Co-hosts the Money Talks News podcast

  • MBA from Utah State University

Miranda is a financial writer and avid podcaster with nearly two decades of experience contributing to major outlets, including Forbes, The Hill, and NPR.

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Chris Schafer
Edited byChris Schafer
Chris Schafer
Chris SchaferSenior Editor
  • 15+ years in content creation

  • 7+ years in business and financial services content

Chris is a seasoned writer/editor with past experience across myriad industries, including insurance, SAS, finance, Medicare, logistics, marketing/advertising, and many more.

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Updated May 23, 2024

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If you’re in the market for a new auto insurance policy, you may have heard the term “car insurance broker.” A car insurance broker can help you compare different auto insurance companies so that you can find a policy that works best for your budget and your coverage needs.

An insurance broker is usually someone who knows what’s available in your state and acts as an independent agent who can work with multiple companies rather than just one insurer. This benefits you because the broker isn’t tied to one particular insurer and can give you unbiased insights into several coverage options.

Quick Facts
  • A car insurance broker can help you compare auto insurance products and choose the right policy for your particular budget and needs.

  • Insurance brokers work on behalf of you, the buyer. This is different from an insurance agent, who represents one or more insurance companies.

  • Even though you don’t need to work with a broker, doing so might make sense if you have complex insurance needs, don’t have time to shop for a policy, or want someone to guide you through the process.

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How a car insurance broker works

A car insurance broker helps compare different policies in an effort to help you find the best policy for your needs and budget. In addition to auto insurance, they may also be able to help you compare life insurance, renters insurance, and homeowners insurance policies. They can also provide you with insight into bundling options and other discounts that might be available to help you get the best price.

For the most part, a broker can help you figure out what coverage you need and help you learn more about the industry. If you have complex needs, such as motorcycle, truck, boat, or RV insurance, they can help you see what choices are available. 

Many insurance brokerages have agents or brokers licensed in many states, so there’s a good chance that you’ll be able to find one in your area — or at least find someone who can point you to an applicable insurance company. An online price-comparison platform might also be able to help you compare quotes.

Some consumers like using brokers to help them identify a policy because brokers are insurance professionals who represent the customer, not a specific insurance company, and some consumers find brokers more trustworthy.

Keep in Mind

Brokers work with various partners to provide car insurance quotes and can’t actually issue an insurance policy.

Auto agents vs. brokers: What’s the difference?

It’s important to understand the difference between an auto insurance agent and a car insurance broker.

First, captive insurance agents work on behalf of an insurance company. They can only provide information about the policies offered by a specific insurer. Agent-driven service is more about looking at your situation and finding a policy from the specific company they work for. It’s also important to note that an agent can either be paid a salary or commission, or both, depending on how the company provides compensation.

A car insurance broker, on the other hand, provides expert advice about different policies from various insurers without ties to a single company. They can take into account your unique situation and find a policy that’s more likely to meet your needs in terms of insurance premiums and coverage. However, unlike an agent, a broker can’t actually issue you a policy. Instead, they will need to work through an agent to get your policy once they help you find your best choice from a variety of car insurance companies.

A broker usually receives a commission from the company once you’ve chosen a policy. Sometimes, though, you might need to pay an extra cost in the form of a broker fee, so it’s important to understand all your costs up front.

Learn More: How Much is Car Insurance? Average Costs

Learn More: How Much is Car Insurance? Average Costs

Benefits of a car insurance broker

A car insurance broker can benefit you in the following ways:

  • illustration card https://a.storyblok.com/f/162273/x/7955361cf0/customer-support-1.svg

    Personal recommendations from a variety of car insurance companies

    A broker’s services are designed to help you compare different companies and policies. They can take into account your family situation and recommend the best company and policy.

  • switching

    Help you compare auto insurance rates

    In addition to helping you find policies, they can also help you compare rates to see if you can get the lowest insurance rates for your specific needs. While it’s not guaranteed to be the lowest rate, you can still get a good idea of what’s available.

  • illustration card https://a.storyblok.com/f/162273/x/38dc81ba93/drive-1.svg

    Inform you about the insurance industry

    You can also get help from a car insurance broker to learn more about what influences your rates. This includes the type of vehicle you have, your age, your driving record, your claims history, and other factors. This information, along with the guidance of a broker, can help you make a better decision.

Drawbacks of a car insurance broker

Before you begin working with a car insurance broker, keep these potential drawbacks in mind:

  • Might be easier to compare quotes on your own: For those with clean driving records, it’s relatively easy to find low-cost car insurance, especially if you don’t have particular needs. If all you need is a simple policy with a low cost, a broker might require unnecessary extra time and energy. A few simple phone calls could be easier.

  • Potential for higher costs: Even though a broker might be able to help you find lower rates, the fact is that they get paid on commission. They might try to get you to purchase additional insurance through them, such as health insurance, or try to get you to bundle other policies in an attempt to increase their commission.

  • Might prefer a website: Many brokers require you to work with them in person or over the phone. If you prefer a simpler model, you might want to fill out a form on a price-comparison platform to get quotes and compare them on your own.

How to buy car insurance

You can purchase car insurance in a few different ways. Here’s a look at some of your options.

Buy a policy yourself

You can compare your own quotes by using resources like the Insurance Information Institute and the Better Business Bureau to get information on different companies.

You can also compare quotes online, using a simple form to research different options based on your needs and budget. This can simplify the process and allow you to choose your next car insurance policy on your own time. You can also choose a policy and then go over what’s needed to secure the policy through an agent, sometimes with the help of a team at the website.

Buy through an agent

If you know what company you want to purchase from, you can use an agent to get a quote. They can help you understand the different types of policies available and the price you’ll pay for different types of coverage. Your agent can then get the policy squared away and finish the process for you.

Buy through a broker

Finally, you can work with someone whose mission is to help you understand the industry and work through your unique circumstances. If you have a complicated situation, a broker can help you identify the best policy to match your needs and then work with an agent to secure your policy.

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Car insurance broker FAQs

Shopping for car insurance can be intimidating, but a broker might be able to help. Consider the following information before you decide whether to use a car insurance broker.

  • Do insurance brokers save you money?

    Depending on the situation, a broker might be able to save you money. They can help you compare auto insurance rates for different types of coverage and potentially help you find the best price. However, there’s no guarantee that a broker’s recommendation will be the least expensive option.

  • How much does a car insurance broker make on a policy?

    The amount a broker makes depends on the commission paid by the company you choose. Additionally, a broker’s commission also depends on the size and price of the policy. If you bundle other items into the policy, the broker could make more money in commissions.

  • How do auto insurance brokers work?

    Rather than being aligned with a particular insurance company, a broker can help you compare different insurance companies and policies to help you find what works best for you. The broker will then usually earn a commission based on the policy you choose.

  • Is it cheaper to buy home and auto insurance through a broker?

    Sometimes, it can be cheaper to use a broker for your insurance purchase. They can compare different policies and prices and help you make the best choice based on your budget and coverage needs. However, it’s not always cheaper, so it’s important to consider other options as well.

  • Why do car insurance agents exist?

    Insurance agents exist to sell insurance. Most states require car insurance, and insurance agents can sell you policies from the companies they represent. They’re licensed professionals who can help you figure out your coverage needs and then get you a policy that meets the requirements of the state, your budget, and your risk tolerance.


Miranda Marquit
Miranda Marquit Insurance Writer

Miranda Marquit, MBA, is a freelance financial writer covering various markets and topics since 2006. She has contributed to numerous media outlets, including Forbes, TIME, The Hill, NPR, HuffPost, Yahoo! Money, and more. Her work has been syndicated by MSN Money, Marketwatch, Credit.com, and other publications. She has written about insurance topics for Clearsurance, HealthCare.com, and various other websites. She is also an avid podcaster and co-hosts the Money Talks News podcast. Miranda has a Master’s Degree in Journalism from Syracuse University. Connect with her on LinkedIn.

Chris Schafer
Edited byChris SchaferSenior Editor
Chris Schafer
Chris SchaferSenior Editor
  • 15+ years in content creation

  • 7+ years in business and financial services content

Chris is a seasoned writer/editor with past experience across myriad industries, including insurance, SAS, finance, Medicare, logistics, marketing/advertising, and many more.

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