Agency
What Does Agency Mean?
An agency is an entity that acts on behalf of another party, referred to as the principal. In the context of insurance, agencies operate on behalf of insurance carriers to sell policies. These agencies are authorized to identify customers and issue policies. In return for their services, they receive a fee or commission from the carrier.
Insuranceopedia Explains Agency
Agencies essentially serve as intermediaries between insurance companies and potential customers. They benefit both parties by specializing in identifying policies that best suit customers’ needs.
In this way, agencies generate business for insurers while simultaneously offering valuable services to customers. Typically, insurance agencies have the authority to sell policies from multiple carriers, rather than just one.
