Owning a small business is a lot like reciting an encyclopedia while balancing on a flagpole: a lot less fun than it looks from below. You have to know everything, be quick and adaptive, and know no fear. Insurance is one of the scarier bits of the balancing act, but there really is help out there. If you are asking yourself, “do I need an insurance agent?” the simple answer is yes: An industry expert who can represent your interests at no cost to you should always be taken advantage of.

Types of Business Insurance Agents

Broadly speaking, these agents come in two types: an independent insurance agent vs direct agent. Direct agents specialize in selling a full range of policies from a single company or conglomerate. They can have a broader range of policy types and may sell both commercial and private policies. However, they are also referred to as captive agents, since they directly represent an insurance policy company and are not free to choose policies from other sources.

Independent agents usually have a wide range of companies to choose from, but they also tend to specialize more in specific types of policies. An independent agent who specializes in your industry or business type may have more detailed information and experience, allowing for a carefully tailored policy. These agents also may find better prices and discounts since they have access to many more insurance companies.

Why an Independent Insurance Agent May be Perfect for Small Companies

Small businesses can range from sole proprietorships to 50 or more employees, and the majority usually will benefit from an independent agent. As an independent, these agents work directly as your representative, not as a representative of the insurance company. And since they specialize more, they can often find policies that have been carefully crafted and tweaked for your individual business’s needs.

The Price Is Right

Insurance agents often have access to discounts for commercial insurance, and you should inquire about them directly. Independent agents are ideally placed to use competition between different companies to get you the widest range of discounts and bundle or group pricing. A savvy independent insurance agent can save businesses up to 30 percent thanks to discounts and credits.

Commercial Insurance Is Like an Insane Game of Tetris

Commercial insurance is incredibly complicated, with many apparently interchangeable parts. Putting them together to make you a winning policy takes passion and long experience. When assembling a comprehensive small business policy, an independent agent can pick and choose from among a vast array of companies and policies, pinpointing specific needs you have and, just as importantly, identifying options you don’t need. The agent can identify holes in existing policies and areas that need better risk management.

3 Things To Look For in Any Agent

Whatever type you choose, there are three basic traits to look for in prospective insurance agents: competence, experience and trust. Use your common sense and gut instinct when you first talk to them. Do they seem competent? Are they interested in providing good service or obviously giving you the brush-off? Ask if they have experience with your type of business and your industry in general , and anything else that will help you decide if you are dealing with a trustworthy representative or a fly-by-night self-promoter.