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The Insurance Broker...

Historically this term refers to any individual who represents their client, a buyer of insurance, to an insurance company. As opposed to the traditional meaning of agent, one who represents the insurance company to the buyer. The insurance Brokerage business is a regulated business. You'll find insurance brokers are regulated by the state laws and rules that apply to the individual states in which they operate. Keep in mind insurance issues are state regulated. Since brokers are licensed by each state where the conduct business it is not uncommon to find individual brokers with licenses for all or many states. Of course each state has its own rules that apply to how insurance business is conducted within their jurisdictions.

Brokers play a significant part in providing workers compensation insurance to businesses and individuals throughout this country. They provide not only workers compensation but all other lines of property and casualty and life and health insurance to their clients.

When it comes to the difference between an insurance broker and an insurance agent, there used to be a real difference. Now, there's not. Many states have done away with their individual regulations between brokers and agents. Again, historically, an agent is a direct representative of an insurance company through the agent-principal legal custom. The agents historical primary alliance is with the insurance company, where the agent is an employee of that company. Brokers, historically, had no employment agreement directly with the insurance company rather had a direct relationship with their client and a responsibility to place the insurance business for their client with the best company they had access with.

More complicated or larger accounts generally have their workers comp audits performed on site, a physical audit, where an auditor actually visits their place of work to review all pertinent records.

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