Independent vs. Captive Life Insurance Agents: What’s the Distinction?

by Sarah Cooke on March 30, 2015 | posted in Life Insurance coverage

When buying for life insurance coverage, the kind of agent you decide on could figure out the value you spend.

Typically, there are 2 sorts of life insurance coverage agents — captive and independent. Almost half of new individual life insurance coverage policies are sold by independent agents, with captive agents accounting for about 41%, direct marketers with 4% and other channels accounting for 6%, according to the most recent figures from the Insurance Data Institute.

A handful of life insurance coverage firms depend exclusively on captive agents, but most rely on independent agents or a mixture of captives and independents. Both sorts of agents can give the kind of top quality experience you need to have to make one of life’s essential monetary choices. But there are some big variations amongst the 2.

Captive agents

Captive agents work directly for a single life insurance provider and are restricted to the items of that company. For instance, if you get in touch with a captive agent for State Farm, he or she will industry and try to sell you only State Farm products. These agents’ commission, if they have a single, is set by their insurance coverage organization, and they are paid by that organization.

On the plus side, these agents are experts in what their insurance organizations have to offer you. But they cannot support a client who does not want or qualify for their company’s merchandise. And captive agents generally have quotas to hit to hold their job and earn bonuses. Despite the fact that that is not terribly different from independent agents, you may well feel a bit a lot more stress to purchase automobile insurance coverage from a captive agent when all you actually want is term life.

Independent agents 

Independent agents, meanwhile, perform for themselves and not any specific insurance coverage firm. They sell policies from a assortment of life insurers, not just one, and make most of their cash by way of sales commissions and bonuses from the carriers.

Independent agents can save you some time by obtaining quotes from a handful of different insurers, which could imply a better price. Nevertheless, they may be much less objective than you feel. Due to the fact they make most of their money off commissions, independent agents could push you to buy a policy that gives them a larger commission — and not necessarily a greater deal for you.

Which is ideal?

The kind of life insurance coverage agent you pick depends on your needs and your budget.

If you’re hunting for multiple quotes from different businesses, an independent life insurance coverage agent almost certainly is the way to go. It can save you time and money. On the other hand, some insurance firms may provide policies only by way of captive agents, and these agents bring a lot of information to the table. You could have to get a few far more quotes, but you could finish up with a greater deal. In some cases, particularly if you are a effectively-informed customer, you may possibly choose against making use of an agent totally and get a life insurance coverage quote directly from the company.

Sarah Cooke is a staff writer covering private finance for NerdWallet. Comply with her on Twitter @sarah_wolfe and on Google+.

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Independent vs. Captive Life Insurance Agents: What’s the Distinction?

What’s your credit card interest price?

According to a recent Essential Research poll, many Australians have no idea what their credit card interest rate is, leaving them potentially out of pocket.  The Essential Research poll of 1,000 people, commissioned by the Customer-Owned Banking Association (COBA) found:

• 65% don’t know who has the lowest credit card interest rates;

• Around half said “Don’t Know” when asked the current rate they pay.

Your credit card interest rate can make significant difference; currently on CANSTAR’s database, credit card interest rates vary from a low of 8.99% to a high of 23.50%. That’s a huge variation and can have an equally huge impact on the amount of interest you pay.

“Our survey results tell us that Australians don’t spend much time thinking about the potential cost of high rate cards if they don’t pay it back,” said COBA CEO Mark Degotardi. “Credit cards offer convenience for consumers. We think consumers recognise they are easy to use and they’re part of life now – from buying a coffee, to filling up the car or paying for the groceries. (But) if people in the morning coffee line spent a few minutes comparing the best rates on offer, in many cases they would see they are paying far too much. From our sector’s perspective, mutual banks, credit unions and building societies offer average rates that are almost 5% lower on average than the major banks.”

How difficult is it to compare credit card interest rates? It’s not: click here to compare credit cards.

What to do if you have a big debt?

For some Aussies it’s not just about the interest rate on their current day-to-day spending – it’s also about that debt that they just can’t shake. The most recent Reserve Bank of Australia (RBA) figures show that we currently owe a total of $ 50.5 billion on credit cards, a whopping $ 33.5 billion of which is accruing interest.

The good news is, there is light at the end of the tunnel.

“For people struggling with debt there are plenty of options available to them,” said Mr Degotardi. “It’s always best to be up front and put all available information in front of your financial institution, they may be able to help you better manage your debt and still meet other everyday commitments. People may also experience unexpected financial difficulties and all institutions will work with customers experiencing financial hardship.”

Transferring your outstanding credit card debt to a 0% balance transfer deal and putting a strategy in place to pay it off is also another option. You can compare 0% balance transfer deals here and  read more about whether balance transfer deals are a good idea here.

Find out more about the Customer Owned Banking Association here

What’s your credit card interest price?

What’s the Difference In between Cheap Automobile Insurance and Pricey Auto Insurance coverage?

When you are shopping for car insurance, it is tempting to decide on the company supplying the least expensive policies. Following all, the average American pays $ 815 for car insurance coverage every year, according to the Insurance coverage Information Institute, and that is a large chunk of alter. A more affordable provider or plan can make a massive distinction in your month-to-month spending budget.

Nonetheless, price tag shouldn’t be the only aspect in your decision of auto insurance coverage provider. There are both good and negative causes why some automobile insurance coverage policies are less expensive than other folks.

Differences in coverage

It may possibly sound obvious, but having far more coverage costs a lot more. A policy with $ 100,000 in liability coverage for each accident is more pricey than opting for the minimum, which may be as low as $ 30,000 in some states. Adding extensive and collision, which covers harm to the car, can also be pricey.

For a lot of drivers, carrying the lowest possible level of automobile insurance is a undesirable move. If you lead to critical injuries to an additional driver and his passengers, $ 50,000 is unlikely to cover their medical bills, leaving you potentially on the hook for the rest. And if you have a newer automobile, it’s sensible to carry complete and collision for at least a handful of years, when it would be most high-priced to replace.

Think about regardless of whether you have assets to protect prior to picking a reduce liability limit. Even if you don’t own a property or have a lot funds in savings, it’s sensible to purchase more than the minimum. If you’re getting drastically various quotes from various providers, make positive you’ve elected the exact same alternatives from each and every.

Variations in businesses

Buying for a certain level of coverage will most likely give you a smaller sized spread of quotes, but it won’t erase all of the cost differences amongst insurers. There are several factors why some companies provide less pricey coverage than other individuals, such as:

• Overhead. Auto insurance companies that employ celebrity spokespeople and have offices all more than the country have higher fees, and their policies might reflect this. Consist of a handful of neighborhood insurers in your search for comparison.


• Volume. Do not count the huge guys out, although. Larger insurers may be capable to greater recover from losses following receiving a high number of claims, allowing them to stay away from raising premiums.


• Further services. If your insurer delivers extras such as roadside assistance, these will undoubtedly expense you. Whether or not this expense is worthwhile is for you to decide.


• Driver type. Despite the fact that drivers with clean records get lower prices, some insurers cater to these with tickets or other violations, and supply them reduced premiums, relative to the competitors. Other insurers provide specialized discounts to drivers of hybrids, students and other groups.

The bottom line

More affordable auto insurance coverage isn’t necessarily greater than expensive automobile insurance, but it is not necessarily worse, either. As extended as you have adequate protection, all that matters is that you have the features you need—and not these you do not.

No automobile insurance firm is a best match for every single driver, but with a small bit of analysis and patience, you can uncover the perfect fit for you.

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What’s the Difference In between Cheap Automobile Insurance and Pricey Auto Insurance coverage?

What’s the price of your job?

If you’re a operating Australian, then income protection is a must-have insurance. After all, why insure your vehicle and property and belongings and not your most worthwhile asset: your ability to earn an earnings.

It is exciting even though to note that your chosen occupation can play a substantial component in the expense of your insurance. When it comes to revenue protection insurance, typically the far more qualified a individual is the reduced, in some situations, the per-dollar expense of their revenue protection insurance coverage can be.

Right here are a handful of examples from our 2014 study, searching at the yearly cost of a $ 4,000 per month earnings protection insurance coverage policy for a thirty year-old non-smoking male…

Occupation	Premium	Occupation	Premium
Teacher	$ 497	Childcare Worker	$ 697
Medical professional	$ 452	Paramedic	$ 1,052
Chef	$ 842	Kitchen Hand	$ 1,142
Supermarket Manager	$ 732	Shop assistant	$ 920

Supply: Canstar Life Insurance coverage Star Ratings Report study, 2014

There are a lot of ways to minimize the expense of your cover although, and CANSTAR’s 2014 Life Insurance coverage Star Ratings report can point you in the correct path.

What’s the price of your job?