The agency system is still there.

The insurance agent is your legal representative to the insurance company. The agent is licensed by the state and carries with them a fiduciary responsibility to be your advocate. The agent must put your interests first and over the insurance company. Even though the agent is paid by the insurance company, they actually work for you.

An independent agent does important things for you, that you may not realize.

• Independent agents typically sell different types of insurance such as auto, homeowners, renters, business, etc. Their services are no cost to you.
• Agents have the ability to quickly check prices and coverage with many insurance companies. Rates vary widely, and independent agents can probably get you a better deal than you can get for yourself. They can also get you insurance from a “direct-writer”, like you could get for yourself.
• Insurance is very complicated. It is the agent’s business to understand it and make sure that you understand it as well. An ordinary consumer will benefit from having someone who understands the ins and outs of insurance.
• Coverage doesn’t just vary in each state, it varies between carriers in the same state. Many carriers use what are known as manuscript policy forms or contracts. These forms don’t use industry-standard verbiage and contain altered provisions that materially affect you in some fashion.
• If you don’t understand insurance thoroughly, you can get caught up in the language. The industry is regulated by the state and each state is different. If you move states, you’ll find that the coverages may look the same at first, but once you inspect them closer, things work a bit differently.

When you go direct, you have no licensed, regulated insured agent acting on your behalf. You take full responsibility for your coverage decision.

Don’t get us wrong, there is nothing wrong with direct-writer insurance companies. However, if you deal with an agent there are certain services and protections you are going to get that a direct-writer insurance company simply cannot provide.