Auto Insurance

When buying insurance, should you go with a broker or a direct-to-consumer insurance company?

By: Luc Rinaldi on February 22, 2021
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This article has been updated from a previous version.

Buying insurance can be an overwhelming experience. Whether you’re looking for home, auto or life insurance, there are dozens of companies and brokerages to pick from. How do you choose?

Luckily, the situation is not as complicated as it seems. There are really only two means of purchasing insurance: through a direct-to-consumer insurance company or through an independent broker. 

A direct-to-consumer insurance company, such as Allstate or TD Insurance, can offer you only their own company’s products. A broker, meanwhile, works for a third-party brokerage and acts as a middleman between you and multiple insurance companies, which allows them to offer you a wider range of products from a number of providers.

Neither a direct-to-consumer insurance company nor broker is consistently cheaper than the other, but they do have meaningful differences. Here are a few things to consider before you make your pick.

What are the advantages of working with a broker?

The main benefit is choice. A broker can compare different providers’ plans and rates and offer you the best unbiased option — whether that’s the cheapest plan or the product perfectly tailored to your unique needs. 

Brokers can also find you discounts that you might not discover on your own — for example, you can save on auto insurance if you use winter tires or insure multiple vehicles on the same policy. 

Brokers tend to be one-stop shops. You’ll often be dealing with the same person to find every kind of insurance you need, which can be more convenient than dealing with a handful of different providers. They can also offer advice on when it makes sense to file a claim with your insurance company, and when it might be cheaper in the long run to pay out of pocket. If you do file a claim, they’ll deal with the insurance company on your behalf, potentially saving you time and stress.

What are the advantages of working with a direct-to-consumer insurance company?

Many large direct-to-consumer insurance companies offer round-the-clock access to their agents, which makes it easy to get insurance outside working hours. In some cases, you can get a quote and sign up for coverage entirely online. This is often a quick and easy option for straightforward kinds of coverage like tenant insurance.

And because agents work for direct-to-consumer insurance companies, they're experts on the company-specific products that they can offer you.

Whether you go with a direct-to-consumer insurance company or a broker is ultimately a personal choice. Fortunately, we work with both. So when you use to compare rates, you can still find the best prices no matter which one you choose.