Independent vs. Captive Insurance Agents – Who is Better?

There are two types of insurance agents: Captive insurance agents and Independent insurance agents.

What is the difference between captive agents and independent agents?

In short, captive insurance agents are contracted to work for one insurance company and can only sell that company’s policies. On the other hand, independent agents are contracted to work with a variety of insurance companies and can sell policies from multiple providers

Captive Insurance Agents

Captive agents are typically full-time employees compensated with a salary, benefits, and commissions. They may also be independent contractors. 

Captive agents are sometimes referred to as “dedicated” agents. They are contracted to work for one insurance company and can only sell that company’s policies. They benefit from the insurance company’s broader marketing strategy. 

One disadvantage of being a captive insurance agent is the fact that they’re not able to shop around for insurance products, a captive agent is bound to just the parent company. 

Captive insurance companies examples would be State Farm, Liberty Mutual, Amica, USAA, GEICO, Farmers & Allstate.

Independent Insurance Agents

An independent insurance agent is a third-party salesperson who works for an insurance agency and sells insurance policies from multiple companies. Independent agents are licensed and authorized to sell insurance products from different companies to consumers. They are paid a commission for each policy sold.  There are no additional fees added to your auto or home insurance when you work with an independent insurance agency (commissions are baked into the policy premium)

Independent agents can help you compare options across several carriers to find the right policy for you. They can provide an array of coverage options, services, and prices. Independent agents typically have an in-depth understanding of multiple providers’ coverages so they can guide their clients on the best insurance decision. 

Independent agents are different from captive agents. Captive agents are employed by a specific insurance company and receive a salary and financial assistance with costs like advertising and hiring. 

Who is better?

For more information on the pros & cons of a Captive Agent, check out this article from Investopedia.

This article is not to determine who is a better fit for you. Each consumer needs to determine who they would like to do business with and why.

While Captive Insurance agents will give you usually an extremely large national brand name and some products that go with that, Independent agents will give you more than a personal relationship. You usually choose to buy insurance through an independent agent because you want to do business with them, not necessarily one of the insurance companies that they represent.

Independent insurance agents will work for you and give you advice as a trusted advisor, not just someone who is selling products.

What’s Next?

It’s essential to think about your options when picking an insurance agent. Consider how it’s like to work with two types of agents: Captive agents and independent agents. While cost matters, having a good relationship and trust with your agent is also important.

Choosing an independent insurance agent can help you understand your coverage better, figure out what you need, and explore different choices. If you don’t have an independent agent or want to review your insurance, just email or call us, and we’ll get things started for you.

Contact Us today for Auto and Home solutions and learn more about how we can help. Give us a call at 603-431-4020, email at or fill out the form on this page to get started.

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