What is the primary function of a broker in the insurance industry?

The primary function of a broker in the insurance industry is to represent the insured and advocate for their needs. Brokers work on behalf of clients to find the most suitable insurance products that match their specific requirements, preferences, and financial situations. Unlike agents who may represent a specific insurer, brokers have the flexibility to compare policies from various insurers, ensuring their clients receive the best coverage options available at competitive rates. This role is critical because brokers provide personalized service, assess risks, and help clients understand the terms and conditions of insurance policies, thus empowering them to make informed decisions about their coverage.

In contrast, an agent typically represents the insurance company and may not always prioritize the client's needs over the insurer's offerings. Legal representation for insurance policies does not align with the primary role of brokers, as they do not serve as legal advocates but rather as intermediaries. Additionally, while processing claims is an essential function within the insurance industry, this is generally handled by the insurers themselves, not by brokers. Therefore, the focus of a broker is distinctly on the needs and interests of the insured client, making their advocacy a key element of their function.