Today I would like to share common questions asked during my initial meetings with my clients, also known as frequently asked questions (FAQs).
WHAT IS AN INSURANCE BROKER?
An Insurance Broker is a person that has permission to seek insurance quotations for an insured (client) or prospective client. A broker is not an insurance company employee. As a representative for the insured, brokers will approach several insurance companies in an attempt to provide quotations and coverage to adequately insure the client's exposures.
An Insurance Agent is a person who has entered into an 'agency contract' with an insurance company for the purpose of selling insurance for that one company. An agent is not an employee of the insurance company, but rather an independent contractor. The agent, unlike a broker, has the authority to bind coverage (legally obligate the insurance company to provide coverage according to the terms and conditions as bound).
WHAT SORT OF EDUCATION DO YOU NEED TO BECOME ONE?
You will need to complete RIBO Level 1 (Acting under supervision of a Principal Broker like Brokerstrust) which I am allowed to promote Home, Auto & Commercial liabilities. For life, critical, disability, investments, group investments & travel insurances; I needed to complete my LLQP & Mutual Fund licenses. After 2 years as a sponsored agent, I became non-sponsored which allowed me to work with Managing General Agent (MGA) like Bridgeforce Financial to provide products and services from different insurers.
WHAT DO YOU SEE YOURSELF IN 5 YEARS?
Given the last 5 years of experience in this field, I see myself growing into an independent Registered Insurance Broker in Ontario (Level 2), which allows me to build my own brokerage. I want to have my own team of specialists to help provide to current, existing and new clients on many areas of speciality like wealth management & estate planning, tax planning, financing (mortgages) and Risk Management. There is a lot of room to grow but it takes a lot of planning and time to build a solid foundation which I see myself building in the next 5 years.
HOW DO YOU GET PAID?
First, I am self-employed which means my income is 100% Commission and trailers. I get paid when a client accepts my proposal on the products and services like Auto & Home insurances. I get trailers based on my current asset base which are based on the total value of all my current & existing clients. By getting this type of commission, I do my best to service and maintain my clientele.
BEING A BROKER, MAKES YOU A SALES PERSON?
Yes and No! A self-employed is like running their own business on a day-to-day business. Sales for any company, corporation or small businesses are crucial to bring in revenue. However Insurance broker does not only promote products, they are based on a servicing market which requires them to build relationship, research & analysing, and recommending solutions. We have a specific guidelines to follow as we are regulated.
Being a broker, isn't about selling one particular product and let you leave at no given notice. That is not the way how I run my business. In our industry, maintaining clients allows you to have trailer fees which is residual income. I can confirm and will inform you that it's in my best interest to keep you as a client which means servicing you as you grow. I do not want to treat my business like a fast-food restaurant because I prefer quality over quantity.
I have answered to all the questions with my honest opinions. If you have any questions or concerns, please kindly send me a quick message.