What Is A Broker Fee and What Are You Paying For?
If we were to guess what the #1 question concerning the cost and fees of commercial insurance is, without a doubt we would say it’s always concerning broker fees.
What are broker fees?
Definition: A broker fee is a fee in addition to premium and commission that is charged by retail and wholesale insurance brokers and that ultimately is paid by the insurance buyer. Such fees are subject to two overriding rules: (1) they must be fully disclosed to the insurance buyer and (2) they must be reasonable
What does that really mean?
Simply put, when purchasing a commercial policy for your business whether it is a general liability or workers’ comp policy, a broker fee is the service charge that a broker will charge for their services rendered.
What does a broker do differently than an agent or carrier?
Insurance brokers work can be very complex. A great broker will have established a complex and wide net or market for them to shop for your insurance. When selecting a broker make sure they have experience in your business and a wide market to shop in. They should be your consultant and partner working to protect your assets and help your business grow. Your broker will be there for you during the term of the policy and hopefully long after and will be able to provide certain direct duties for servicing your account.
These services can include:
New and ongoing certificate of insurance (COI’s)
Endorsements/changes to your policy
Financing questions and changes
Policy updates
Audit support
Work towards aligning your renewal
What if I have more questions regarding broker fees?
No problem, we’re here to help educate you in this process. Call us or email us with any questions you may have. And if it seems like a common question, we can publish an article to others in your similar position. Our goal is to publish information that helps you make very difficult decisions.
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Please note that the information on this website, including all articles, videos, and presentations, is expressly the opinion of the creator/author of that material. We are not lawyers and are not providing legal advice in regard to insurance. It is respectfully offered with the intention that exploring this material will be educational and helpful to you.