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Professional health insurance brokers offer the expertise that can help find the best plans for your business and guide you toward the right choices. These people are licensed specialists who:

• Know the market. They can discriminate the best products from the merely adequate.
• Know the law. They are experts in the state and federal regulations that can expose your business to severe liabilities.
• Know the industry. They have met licensing requirements, which compel them to keep up-to-date on the insurance market.

Brokers vs. Agents

An insurance agent sells the insurance services of a single insurance company.

When we say “broker,” we mean an expert who can direct you to products offered by various companies. This is in contrast to an agent who operates with only a single company and promotes its products. 

Technically, both of these professionals are licensed as insurance “agents,” but we differentiate between them based on common parlance. If you do not use a broker, you will possibly work with an agent at each company you contact.

What Will the Broker Do?

Your broker will help you:

• Examine alternatives with you so that you have a clear understanding of your plan choices.
• Shop for the right plan(s) for you, and offer you one or more premium quotes.
• Service the account, including solving issues with billing, eligibility, and claims.
• Implement the plan you select.
• Ease the burden on your time by handling the “legwork” for you.
• Get the most from your coverage after you’ve purchased it.
• Assist with the renewal process.

Broker Commissions and Fees

Brokers receive a basic commission for their services and sometimes charge extra fees too. Commissions are typically based on a percentage of the annual premium and are accounted for in the premium that you pay. A broker’s basic commission is incorporated in the insurer’s rates, so everyone ends up paying them whether they use a broker or not. Fees, on the other hand, maybe charged for particular extra services. You’ll need to ensure you know what costs will be charged when working with a broker. Additional fees are generally paid directly to the broker.

Finding and Choosing a Broker

You can find an insurance professional in your community in several ways:

• Contact associations that focus on health insurance or small business. Often they can direct you to brokers. Your state or the local association of health underwriters or chamber of commerce are just two examples.
• Check with other people with businesses about their experiences.
• Ask trusted advisors, such as your attorney or accountant or.
• Check for brokers online. We discuss online brokers below.

When deciding on whether to use a particular broker, be sure to keep the following in mind:

• Enquire about the dollar amount of any fees or commissions that you will be charged and ask if any separate fees will be added to the agent/broker’s premium.
• Clarify the services that you will receive. For instance, some will assist you with explaining the plan to your employees; others will not.
• Remember that an agent or broker becomes a part or an extension of your staff. How well does this individual work with your staff on a day-to-day basis?
• Discuss how the agent vs broker will help you during the year. Will your representative be your primary contact, or is another person responsible for servicing your plan?

Online Brokers

There are numerous broker-sponsored websites aimed at consumers shopping for health insurance.

There are hundreds of broker-sponsored sites aimed at consumers shopping for health insurance. Health Insurance  Broker sites are in two categories: those sponsored by independent brokers whose basic interaction with clients is offline and those ran by companies that specialize in selling insurance online. The two different kinds of sites have different capabilities.

Independent broker sites may offer only limited online capabilities but may provide more personalized service and more significant administrative support throughout the year. 

Brokers dedicated to the online channel may offer broader online capabilities but less ongoing support for billing, eligibility, and claims issues. These sites aim to have most consumer interactions occur online, but also offer centralized telephonic customer service to augment online services.

Resources and References:

• Brokers and Agents