What is an insurance broker?

A car insurance broker helps you find the right cover and may also assist with claims.

As independent, regulated professionals, they aren't tied to a single insurer. Here's what you need to know.

What is an insurance broker?

An insurance broker is a Financial Conduct Authority (FCA)-regulated insurance advisor. The broker will act as an independent, unbiased intermediary dedicated to helping their client find a suitable policy meeting their needs at the best price.

As an independent advisor, they do not act on behalf of any insurance company. Instead, they hold a legal duty to act in their clients' best interests to provide impartial advice and source tailored insurance policies.

Some brokers also handle claims on their clients' behalf, speaking to loss adjusters and insurers' claims departments. This can result in a faster claims process with little and sometimes zero input required from the client.

Insurance brokers are typically paid either through commission from the insurer or a separate fee paid by their client. A broker should be upfront and transparent in terms of their payment, so you have a clear understanding of the arrangement.

If they are paid through commission, their payment is usually built into your insurance policy premium - so it doesn't cost you extra directly. Alternatively, some brokers charge fees for their advisory services clearly disclosed to clients.

Is Confused.com an insurance broker?

No. Confused.com is a price comparison website, also known as an insurance intermediary. This is different from a car insurance broker.

As a comparison website, we help you compare a range of car insurance policies based on your set criteria - in the same way a broker would.

The key difference is that comparison websites are free to use. Brokers tend to charge a flat fee or add commission on top of what you pay for your policy.

We earn money by charging the insurance providers we work with a flat fee for every policy bought through us. This doesn't affect the price you pay, or the quotes we show you. 

Why use a car insurance broker?

Let's say you own a 'classic car' but have made several modifications to the vehicle. Searching for a classic car insurance policy that gives you the cover you need specific to your situation can be tricky. A broker should be able to narrow down a list of policies and find one that suits your needs.

A car insurance broker can also help identify specialist policies that might be difficult to find for drivers with a criminal conviction, for example.

Another benefit of using a broker is their tendancy to develop working relationships with the insurance providers they work with. In some instances this can result in special car insurance deals you might not get elsewhere.

As a 'middleman', brokers can work with you in the event of a claim too. In some cases they might be able to negotiate on your behalf - saving you time and hassle.

It's important to research brokers, though. Some only work with a set amount of car insurance providers, so you could miss out on better deals elsewhere by going through them.

Who could benefit from using a car insurance broker?

As brokers search for policies tailored to their clients, they can be useful for drivers who need specialist cover.

They could be useful for:

Convicted drivers

Finding cover can be challenging if you have a criminal record. A broker can help find specialist providers and policies dedicated for those with a conviction. Car insurance for convicted drivers can be more expensive than standard car insurance, but you have to disclose any convictions you have to your insurer - otherwise you could risk insurance fraud.

4x4 drivers

If you intend on driving a 4x4 as you would a normal car, a standard policy should cover you. However, if you're planning on going off-road or green-laning, it's more than likely you'll need a specialist 4x4 insurance policy to keep you covered.

Classic car drivers

There are a couple of differences between standard car insurance and classic car insurance. One of these is the agreed valuation of the car you're looking to insure. This is the claim amount you agree with your insurer, not the market value of the car. A broker can help you find a suitable policy for a classic car if you find it difficult to get insurance.

Performance car owners

Insurers typically class performance cars as fast, expensive and with large and powerful engines. These types of cars are considered high risk by insurers. It's likely you'll have fewer and more expensive policies to choose from if you have one, so a broker could present you with the most affordable performance car insurance options.

What's ghost broking, and how can I avoid it?

Ghost broking is the act of selling forged insurance policies and documents. Here, fraudsters attempt to appear as legitimate car insurance brokers to scam victims out of money.

One of the key risks in buying an insurance policy from a ghost broker is that it's more than likely that your cover isn't valid. This means you won't be able to claim if you need to in the event of an accident or theft, leaving you severely out of pocket. It's also illegal to drive without valid insurance in place, so you could be opening yourself up to point, fines and more too.

There are several red flags you should look out for in avoiding ghost brokers. They can be difficult to track down as they're unlikely to provide contact details or an address to verify their legitimacy. Fraudsters are likely to use social media, message boards or whatsapp. So, always remain vigilant and take time to research thoroughly to avoid getting caught out.

Where can I find specialist brokers?

The FCA's Financial Services Register is the essential check. Every legitimate broker must be on this list, so it's always worth verifying any broker you're considering before you buy.

It's also worth reading genuine reviews and testimonials online for extra reassurance.

The British Insurance Brokers' Association (BIBA) offers a helpful directory too, but it's worth knowing BIBA is a voluntary trade body, not a regulator. Brokers don't need to be a member to legally operate, so BIBA membership is a useful bonus signal, not a substitute for checking the FCA register.