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It would be easier to understand the differences between general insurance brokers and web aggregators by analyzing the functions of each entity as below:
An insurance broker can be best described as an expert consultant who is knowledgeable about insurance and risk management. Generally, he works on behalf of his clients and not for insurance companies as such. Insurance brokers can be depended on to provide professional advice and guidance in the best interest of the client. Online insurance brokers are specialized to help and will lend a hand in identifying client’s individual and/or business risks so that he can make a decision on how to deal with them. They help with the type of insurance policy one needs to safeguard one’s assets and livelihood. Insurance brokers are familiar with insurance inside out. They can point out the imperative details that would by-pass the standard insurance buyer, benefits and exclusions, such as terms and conditions, and the costs of wide-ranging competitor insurance policies. Thereby, they help to find the best insurance policy and one can buy the same for the best competitive price. Currently, in India, Green Life Insurance, India – Save Money in Insurance Buying one of the top insurance brokers. An insurance broker can be an individual or partnership firm or incorporated company for the purpose.
This method has been going on for the last many years since it started during the time the internet was not available to mankind. This method is good, but not great. It is slow and cumbersome involving a lot of running around for suitable insurance broker. This method was good until some years ago, but now it is boring and highly tedious to do.
It is possible to drag an insurance broker to court since he is the customer’s agent. A broker is having a valid license and necessary training but with a different mandate. The prime duty of the broker is not to represent the insurer but customers. Brokers have a fiduciary responsibility towards the customer. An ethical responsibility is a legal relationship of trust and confidence between two parties connected by the insurance broker. Brokers by law promise to keep client’s interest supreme. So as brokers they understand clients requirements and browse through several insurers to get the best-fit product.
As seen earlier that one can take the broker to the court in case he fails to do his duties. One can also approach IRDA who can cancel the broker’s license if found guilty. The aim and purpose behind making banks an insurance broker is to enforce accountability in the deal. The brokers will have an ethical responsibility towards client for the products offered from multiple insurers. The Insurance broker offers the following advantages:
A web aggregator is a primarily a company incorporated under the Companies Act and approved by the Insurance Regulatory and Development Authority of India(IRDAI), which owns or maintains a website. It provides information on various insurance products of different insurers to the clients. So a web aggregator for insurance is a website portal or a search utility to help a client to avail a number of insurance quotes through an electronic e-quote form. The online Insurance Web Aggregators have entered in agreements with a number of insurance providers to present a comparative quote/ price of policy based on a pre-determined list of individual needs as submitted/requested by probable clients or customers.
Since India is becoming a net-savvy country slowly and steadily over a period of time, the e-commerce businesses have taken the country by storm. One can buy anything and everything online at the touch of a button and make swift payments immediately. Not only is this process faster, but it is also less cumbersome since everything happens at your beck-and-call and is within your control not any agent or insurance company as such.
The concept of web aggregator is used for online inquiry/shopping, wherein end consumers are able to get information and quotes on diverse financial products. Web aggregator is basically insurance portals that help one compare products and enable purchase by directing one to the insurer or the insurer to one. At present as per the list issued by IRDAI in July 2018, there are 29 such aggregators operating in the insurance sector.
These are the major differences of operations and functions of two entities as mentioned above in insurance service sector.