For Manhattan Insurance, Agent or Broker Makes a Difference

Gotham Brokerage can help with NYC insurance policy disputes

People outside the insurance industry often use the terms “broker” and “agent” as if they were interchangeable. Agent and broker are not synonyms. Essentially, an agent works for the insurer; a broker works for the insured. Gotham Brokerage can help if you are looking for NYC insurance.

Mixing the terms up is easy — the licensing process and basic duties are the same, and the same person or firm can be a broker in one case and an agent in another — but a critical distinction exists. An agent is an independent contractor who has signed a contract with an insurance company to sell that company’s insurance; Gotham Brokerage Co., Inc., is a contracted agent for Travelers. We have the authority under our contract to underwrite Manhattan co-op insurance policies for Travelers, Queens renters insurance, and just about everything else. , which means we legally obligate the company to provide coverage under the terms of the policy we sell. When a client sends premium payments to us, it’s the same as sending it to Travelers. We also write policies for the Chubb Group.

A broker is someone who on behalf of a client seeks out insurance quotes from an assortment of companies based on the client’s insurance needs. Brokers can’t bind or underwrite policies; the insurance company or companies that issue the policy need to do that. The broker’s fee or commission is included in the premium cost, and brokers have to disclose the amount and get written consent from the client beforehand.

The lines between the two can sometimes blur, as both brokers and agents must take the same pre-licensing education courses, take the same state licensing test, retain the same number of continuing education credits and comply with the same disclosure rules. The same state agency, in New York the state Insurance Department, regulates both and responds to consumer complaints about both. Every state has its own regulatory agency, and the distinction between broker and agent is essentially the same in every state.

That’s another thing to remember. If you run into a problem with an agent or broker — if they’re charging you for services outside the terms of your contract, or if you believe you’ve received an insufficient settlement — the state Insurance Department is the place to go. The state can determine whether you’ve been treated fairly and investigate fraud claims.

These links will get you to state insurance departments:

Gotham Brokerage often acts as a third party in cases when clients think they’ve been defrauded and the insurer isn’t responding to complaints. If you have a similar problem, we’d be  happy to take your case to the state and make sure you’re satisfied that you’ve been treated fairly.

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