Should I buy car insurance through a broker? – Forbes UK Advisor


Shopping around for auto insurance when your existing policy is up for renewal every year is the first step to getting the best deal. But, rather than researching the best auto insurance policy yourself, you can hire a broker to do the work for you.

This guide explains how car insurance brokers work, and their pros and cons, so you can decide which is best for you.

What is an auto insurance broker?

An auto insurance broker is an independent person or company that researches the insurance market on your behalf to find the best deal.

Your broker will ask you to provide a few personal details in addition to specific policy requirements, such as adding additional drivers, the type of coverage you need, and the amount of voluntary deductible you are willing to pay.

Your broker will then research the most appropriate auto insurance policies to meet those needs.

How do auto insurance brokers work?

Auto insurance brokers act as a platform between you and the insurance companies. And, according to the rules of the British Insurance Brokers Association (BIBA), they must always put your interests first.

Is it better to buy car insurance through a broker?

There are certain situations in which buying car insurance through a broker could be to your advantage.

You could benefit from preferential rates. Some brokers have relationships with insurers that allow them to negotiate better rates on car insurance.

You will have access to specialized expertise. Brokers have extensive experience which can be useful in certain scenarios – for example, if you own a classic car and need a specialist policy or if your personal circumstances prevent you from finding insurance.

You might get help filing a claim. Auto insurance brokers can often guide you through the auto insurance claims process. As well as making the process less stressful, brokers will ensure that your interests are covered and, in the event of a disputed claim, will be able to argue the case as equals with the insurer.

You might find a more appropriate policy. If you’re unsure of all the terminology or aren’t sure which auto insurance policy is right for you, using a broker can help you get the right level of coverage at the best price.

What are the disadvantages of buying car insurance through a broker?

Although there are a number of advantages to using a broker, there are also some disadvantages to watch out for.

Perhaps most importantly, many brokers only work with a panel of auto insurance providers, meaning they won’t be able to research the entire market and might not find the best one. offer available.

Additionally, you may have to pay a fee for the broker’s services or a commission may be added to your premium, making it more expensive. For this reason, it is essential that you know exactly how much you will be charged before agreeing to anything.

You might also think there’s no need to use a broker to find the best auto insurance deal, especially since you’ll need to find the time to talk to your broker and go over your needs. .

Price comparison websites make it quick and easy to search the market and find a great deal at a time that suits you, whether from the comfort of your own couch or on your commute.

What is a ghost broker?

A ghost broker is someone who sells you an auto insurance policy that doesn’t exist or isn’t valid, meaning they won’t pay you if you have to make a claim.

Ghost brokerage is a type of scam that tricks you into thinking you’ve found cheaper car insurance, when in reality you don’t have any coverage. The scam usually works in two ways:

  • False information is used to purchase policies from legitimate insurance companies and these are then altered before being resold to customers
  • Fake car insurance documents are designed to look like they were issued by legitimate insurance companies and are then resold to consumers.

To make sure you don’t fall for this type of scam, always be wary of brokers who contact you through social media or advertise their services on local business message boards. Remember, if the offer sounds too good to be true, it probably is.

If you are concerned that you purchased your auto insurance policy through a ghost broker, contact your insurance company directly or check to see if your policy is included in the auto insurance database.

How to Find a Regulated Auto Insurance Broker

To be sure you are using a regulated and licensed car insurance broker, always look for one using BIBA’s Find a Broker service.

Using a regulated broker means you can go to the Financial Ombudsman Service if you have a complaint and you are protected by the Financial Services Compensation Scheme (FSCS) should your insurer default.

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