An insurance broker acts between you and insurers, helping you understand available options and arrange cover that is consistent with your stated insurance needs.
An insurance broker is a firm or person that helps customers find and arrange insurance. It acts between the customer and one or more insurers.
The broker helps arrange the policy. The insurer provides the cover and takes on the insured risk. This means the broker is not usually the business that would pay an accepted claim.
A broker may collect information, request prices from insurers and explain the options available. Some brokers may also help with policy changes, renewals or claims. The exact service can vary between firms.
MoneyHelper explains that a broker can be useful when a customer has specialist needs or finds it hard to obtain standard cover.
A broker will ask questions about you and what you want to insure.
For car insurance, this may include your vehicle, drivers, use, claims history and convictions. For home insurance, it may include the property, its occupants, previous claims and unusual risks.
The broker uses this information to seek an insurance quote from its available insurers. Each insurer will apply its own underwriting rules.
Under the FCA’s demands and needs rules, a firm must identify the customer’s insurance demands and needs. Any policy it proposes must be consistent with them.
This does not mean every broker searches the whole insurance market. A broker may use:
The FCA requires brokers to explain the scope of their service. They should also make clear whether they are giving advice or providing information.
A broker may receive commission from the insurer. It may also charge the customer a fee, or use both payment methods.
Possible fees may include charges for:
Under the FCA’s remuneration disclosure rules, the broker must explain how it is paid for the contract, including whether this is through a fee, commission, another benefit or a combination. If a fee is payable, it must state the amount, or explain how it will be worked out, before you become liable to pay it or the contract is completed.
Always check the total price. An insurance premium may not include every fee, optional extra or instalment charge.
You can use the FCA Firm Checker to check whether a broker is authorised and has permission to provide the service you need.
You should also check:
Read the insurance policy, schedule and statement of fact. Tell the broker if any detail is wrong.
You should take reasonable care to answer the questions asked accurately. Missing or incorrect details could affect the price, policy terms or a future claim, depending on the circumstances.
Contact the broker first if you are unhappy with how it arranged or managed your policy. The firm should explain its complaints process.
Eligible complaints that remain unresolved may be referred to the Financial Ombudsman Service. The Ombudsman can consider many complaints about insurance sales, administration and claims.
A complaint about a broker is not always the same as a dispute with an insurer. The correct business to contact will depend on what happened and who made the decision.
We are an insurance broker. We arrange policies through insurers rather than underwriting every policy ourselves.
We can look at options from our insurer panel for car insurance, van insurance and home insurance.
We often help people with needs that may not fit standard insurance. This can include previous claims, motoring convictions, a low no-claims bonus, flood risk or an unoccupied home.
The insurers available, price, policy terms and acceptance will depend on the full details provided. Using a broker does not guarantee that an insurer will offer cover.
Always check the insurer, cover, excesses, limits, exclusions and conditions before buying.
