Insurance companies vs brokers: Who is your best bet in the UAE?

Deciding between working directly with an insurer or going through a broker is a question a lot of companies ask themselves when purchasing group health insurance. Here are some insights into the key differences to make your life easier.

With over 150 registered insurance brokers in the UAE, it is evident that we live in a broker led market. However, a common concern among HR professionals is deciding between purchasing their group health insurance policy through a broker or the insurance company itself. The functions performed by each are quite similar, but not identical.

Online tools and other resources are making it easier to find a wide range of policies in the insurance market. With more options to choose from, the need for an insurance broker is imminent to help you navigate through the complexities of placing your group health insurance policy. “When it comes to claims and renewals, your broker usually takes the burden off you by providing long-term service.”

Insurance brokers:

Insurance brokers are usually independent businesses who partner with multiple insurance companies to sell insurance plans. This means that the broker has a variety of plans from various insurance providers to choose from. Since they are not associated with a single insurance company, they are able to give unbiased and consultative advice. Brokers are also experienced in comparing and finding the best policy that fits your organizations requirements. Since they are more experienced in customer service, brokers often take time to discuss your needs and priorities in order to build an understanding of your business and provide you with insurance plans that suit your company the best.

When it comes to claims and renewals, your broker usually takes the burden off you by providing long-term service. They deal with the claims department on your behalf and ensure that the claims are handled as smoothly as possible. Brokers also analyze your existing policies and highlight any key areas where the employees’ claims have focused over the past year. This helps you keep the premiums low for the upcoming year as the brokers propose strategies based on their analysis and expertise.

Finally, brokers usually go the extra mile and process all necessary paperwork for you while keeping in touch throughout the year to process any additions or deletions. Having said that, it is important to note that staying up to date and providing the clients with reliable and comprehensive product knowledge can be challenging for some brokers so choosing which broker to work with is as important as the insurance policy you select.

Insurance Providers:

Insurance providers usually have their agents who represent that insurance company. These agents have the knowledge and expertise about the insurance products of the company they represent. They focus on fostering a close, long-term relationship with their clients.

Insurance agents are experts in their products and can help you understand the insurance policy in great detail. Similar to insurance brokers, the agents also take care of your claims, additions, and deletions. However, if you face an increase in the premiums and you do not want to switch your insurance agent, it can be challenging to find a different plan as the insurance agents deal with a single insurance company.

Since the insurance brokers and the agents monetize through commissions on the sale, there is not a large difference in the prices of the insurance products. Besides that, health insurance policy prices in the UAE are commoditized, which means that all brokers offer the same price unless they cut their own profit. Therefore, the primary way to differentiate between insurance brokers and agents is through evaluating the value addition, services and customized features available.