Insurance agents can be divided into groups based on the type of insurance that they sell and on their relationship to the firms that underwrite the policies that they sell. Agents often specialize in one particular field of insurance, such as homeowners insurance, life insurance, car insurance, or health insurance. Some agents work for just one insurer, while others sell products from a number of firms or are hired by the buyers of insurance to shop for policies on their behalf. Agents are also increasingly split between those who work as part of large agent pools and those who operate primarily as individuals.
Each type of insurance product has unique characteristics. The division between types of insurance makes it advantageous for a given agent to specialize in one or two types of insurance coverage. Health insurance is a particularly complicated product, and insurance agents selling this type of coverage are apt to specialize. Agents in smaller communities or smaller agencies are more likely to sell products in different areas, as specialization makes less sense in those settings. All types of agents may sell secondary products as well, such as annuities or other investments.
A crucial distinction between different types of insurance agents stems from their relationship with the corporations underwriting the policies being sold. Some agents have exclusive relationships with one particular company. These agents may have access to preferential rates, but are limited in the variety of products that they can sell.
Independent insurance agents make a living selling insurance from a wider array of firms. The fact that they work with multiple firms means that they are able to offer competing quotes from a variety of different insurance providers. This will typically provide the clients of independent agents with a wider selection of products to choose from. Such agents must devote more time and energy to learning the details of products from many different firms, however.
Insurance brokers act on behalf of consumers rather than insurance agencies. They perform a similar function, however, by locating policies that meet the needs of consumers at the best possible price. Brokers may negotiate with other agents in some cases.
Changes in communication technology are altering the nature of work as an insurance agent. Many insurance agents are now employed in large agent pools to support phone or Internet orders for insurance. These agents may or may not maintain an ongoing relationship with particular clients. More traditional insurance agents typically do maintain such relationships.