This is one of the easiest questions to answer. Brokers are people who read the policy wording and fine print and know what a client’s rights are when claiming. They also work with a wide spectrum of products and insurance companies and can therefor assist the client to correctly structure his / her insurance policy.
We all watch TV and listen to the radio and are bombarded with ads that imply that having a broker cost the client money.
What about the cost of not having a broker?
Companies proclaiming they can save a client money by not allowing brokers to assist the clients, have very high advertising cost. How would that benefit the client? Who else than their “direct client” will be the one paying that cost? Clients who do have brokers, have the added value that a professional independent person will be giving them proper advice and also help them understand the requirements and policy cover. These clients can speak to their broker and don’t have to talk to some-one in a call centre. Brokers will also review and advice the client at least once a year. Brokers go out and see the client if that is what is preferred. It might seem a bit old fashioned, but it works! We all want some-one to really take an interest in our welfare. That person is the broker.
According to one advertisement: “Doing your own insurance isn’t half as complicated as brokers make it ” Do you believe this. Well let’s test it:
- Did you know that some direct insurance policies limit the amount that you can claim for if your ceilings and cupboards and walls are damaged after a pipe or geyser burst?
- Did you know that some insurance policies determine that you have to notify them of a claim within 72 hours. Some policies say within 30 days. Which one do you have?
- Did you know that some insurers don’t pay out if the radio in your vehicle is stolen when it is a radio of which the face can be taken off? They insist that you take the face off. Why are you paying a premium on that radio, if you have to carry it around in your bag?
- Did you know that some insurers limit the third party liability to as little as R50 000 and some automatically give R5 000 000 cover? Which do you have?
- Did you know that some direct insurer apply the average clause to geysers. If you don’t notify them that you have a second geyser your cover is limited.
- The next fact makes brokers smile: Did you that some direct insurers pay a commission to the staff member writing your policy? 🙂
Brokers are professional people providing Professional Financial Service. Not having a broker can have negative financial implications for a client.