Car insurance brokers: background

When searching for car insurance it can be hard to know where to start, with so many different insurers and policies to choose from. If you're looking for a helping hand, you can enlist the help of a broker to do the legwork for you.

They will scour the market and source car insurance quotes on your behalf by dealing directly with insurers so that you don't have to.

Car insurance brokers have been around for a long time and pre-date price comparison websites such as MoneySupermarket. The good news is, here at MoneySupermarket we can compare brokers as well as individual car insurance companies - meaning you have all the options available to you at your fingertips.

Save time and money on your car insurance

Here we take a closer look at what exactly car insurance brokers do - and the pros and cons of using car insurance brokers when buying motor cover, compared to finding a policy yourself.

What are car insurance brokers?

A broker is a person or company who researches the car insurance market on behalf of you, the customer. They do not represent or work for one particular insurer. Instead, it is their job to carry out research across a range of different insurers to seek out the right deal for you, based on your particular needs.

Once a broker has done its research, it will return to you with a range of available options. It is then up to you to decide whether or not to proceed with any of these.

If you're considering using a car insurance broker, it's worth noting that, under the operating rules of the British Insurance Brokers Association (Biba), they are obliged to champion consumer interests. That means they should put you first in any transaction, rather than the insurance company or, indeed, themselves.

This means they will be representing you and fighting your corner, which can be helpful when trying to find your way through the maze of different car insurance companies and motor insurance deals on offer.

It can also make a difference if you have to make a claim - they should help you through the process and take the lead in any negotiations with the insurer.

What are the advantages of using car insurance brokers?

Trawling through the car insurance market can be tricky, so it can be useful to have a helping hand from an expert who knows all the loopholes and the tricks of the trade.

Car insurance brokers can prove invaluable in helping you find the right car insurance deal for you at the best possible price. They will know what to expect from different insurers, based on your requirements, and can target the search at those insurers likely to give you the best level of cover at the best possible price.

Making use of car insurance brokers can help save you time - as well as money - as that person or company will do all the hard work for you, meaning you don't have to spend hours of your own time trying to arrange a policy.

Further, as car insurance brokers will have built up relationships with certain insurers over time, they may be able to negotiate preferential rates that would not be offered to you if you approached the insurer directly.

In addition, a broker may also be able to source car insurance quotes from a specialist insurer that does not deal directly with members of the public. You might be thankful for this kind of help if, say, you own a specialist vehicle, such as a classic car - as you may find it difficult to get cover through a mainstream insurer.

This may sound very appealing, but it's worth bearing in mind that the service offered by car insurance brokers is quite similar to the service offered here at MoneySupermarket - it's also our aim to help customers save time and money when buying motor insurance cover.

Equally, in the same way that a broker can help you find specialist cover, MoneySupermarket can also help you scour the market and find an insurer who will meet your specific needs.

What are the disadvantages of using a broker?

Before making any decision, it's worth noting that brokers do come with limitations, as they may only have relationships with a certain number of car insurance companies. Also known as a panel, this list may not include the right insurer for your particular needs.

Crucially, if a broker is not searching the whole market, this could mean you miss out on the very best deals.

Further, by purchasing car insurance through a broker, you can also end up paying more for your policy than you would if you'd purchased it directly, as the broker is paid commission by the insurer each time it sells a policy.

Generally speaking, the commission will be included in the premium you pay for the policy - so it may not be clear at first sight exactly how much you are paying for this service.

The key here is to ask upfront how much the broker intends to charge for its services. This will ensure you are armed with all the necessary information before deciding whether or not to proceed with a broker.

What is the difference between a broker and an insurance agent?

Unlike brokers, car insurance agents are normally contracted to an insurance company so that they can only sell car insurance from that company. The key thing to understand is that agents work as a representative of the insurer - rather than for you, the customer.

As a result, the price you pay for your policy if you go through an agent will be equivalent to the premium you'd pay if you dealt with the insurer yourself directly.

By contrast, as mentioned above, prices can be higher if you use car insurance brokers, as it will be paid commission for selling a policy from that particular insurer.

Compare car insurance brokers with MoneySupermarket

If you're looking to compare car insurance brokers, you can do this with a few clicks of the mouse at MoneySupermarket.

Equally, as the site compares both car insurance brokers and more than 100 different car insurance providers, this means you get access to a very wide range of deals - giving you plenty of options to choose from.

With MoneySupermarket, you can compare car insurance quotes quickly and easily online - and can also get access to those insurers which typically do not deal with brokers, as well as those that do.

All of this means that by logging on to MoneySupermarket you should be able to get all the car insurance quotes you need in less than 10 minutes.

Save time and money on your car insurance

†82% of shoppers obtained a quote in 5 minutes or less. Source eDigitalResearch December 2012.