Multiple choice

Do you know your options? When business owners make purchasing decisions, they want to have a comprehensive knowledge of their options and the
benefits of each one. But companies often
don’t have the resources to do this
research. And to make the situation more
confusing, expert salespeople can make it
very challenging to tell whether their product or service is really the best fit.

That’s why businesses benefit when complex services, like insurance, are offered
via multiple distribution methods, including the independent agency. When customers work with independent insurance
agents, they know that they have an expert
advocate who can help them sort through
the alternatives and decide on the best

“Customers receive greater satisfaction
when the agent places insurance with the
company that best meets their needs,” says
Kevin Wermer, executive, P&C marketing
at Westfield Insurance.

Smart Business spoke with Wermer
about the benefits of working with an independent insurance agent.

What are the different types of insurance distribution systems?

There are a variety of ways to purchase
insurance, including:


  • Direct — With this method, the customer works without an agent and interacts directly with the insurance company.
    This type of distribution is most common
    in personal lines, and the customer usually
    interacts with the company via the
    Internet, mail or telephone.


  • Captive — In this system, the customer
    works with an agent who represents only
    one company.


  • Independent agency system — With
    this mode of distribution, the customer
    works with an agent who represents multiple insurance companies.


Why is the method of distribution significant to

The direct and captive distribution channels bring value to their customers by providing a way for people and businesses to
purchase insurance. But in both of these
situations, the company, or agent representing a single company, has a vested
interest in customers choosing their insurance product.

Independent agents provide one-stop
shopping because they can more effectively align businesses’ needs with one of the
many insurance companies they represent.
They provide customers with the greatest
number of choices — often representing 10
to 20 companies. The independent agent
can be more open to where the customer’s
business is placed and find the best value
proposition for the customer.

What are the benefits of independent distribution systems?

Not only can independent insurance
agents present more insurance options, but
also they can customize insurance programs to fit the complex needs of individual customers. Because these agents operate independently of a particular insurance
company, they can act as trusted counselors who help customers regularly evaluate whether their insurance still meets
their needs. As businesspeople, independent agents are always competing in the marketplace and therefore have to keep up
to date on all the insurance products and
services available.

In addition to working for the best interest of the customers that are purchasing
insurance, independent insurance agents
also act as advocates for customers in the
event of an incident, such as a claim. Since
independent agents are not employees of
the insurance company, they can act as
skilled ombudsmen in controversial situations.

How can businesses find an insurance distributor that best meets their criteria?

Businesses can choose from approximately 30,000 independent agencies countrywide. The best way to find an insurance
distributor that meets your needs is to talk
to other people who are currently satisfied
with their insurance program. Beyond that,
customers can do their own research and
pull up all kinds of information on the
Internet, as well as consult their local yellow pages for an agent nearest them.

If you know of a company you would like
to have handle your insurance needs, you
can pull up its company Web site and find
out how to access a local agent. It also
doesn’t hurt to review insurance advertisements and formulate an opinion about the
products and services that are most important to you. By talking to an independent
agent, you can obtain information on a vast
array of insurance companies with a single
phone call.

KEVIN WERMER, executive, P&C marketing, can be reached at
(330) 887-0580 or [email protected]. In business
for more than 159 years, Westfield Insurance provides commercial and personal insurance services to customers in 17 states.
Represented by leading independent insurance agencies, the
product we offer is peace of mind and our promise of protection
is supported by a commitment to service excellence. For more
information, visit