What is an Insurance Consultant?

Insurance consultants are professionals who specialize in assisting businesses and individuals in assessing their insurance needs and creating an insurance plan that will meet those needs. In terms of the business world, an insurance consultant may help a business or corporation develop health and life insurance plans for employees as well as assess the types of corporate insurance coverage needed to create a viable risk management coverage program. For individuals, an insurance consultant can often help identify programs that will assist with health and life insurance coverage as well as assist in evaluating and securing insurance related to specific needs such as travel.

To become an insurance consultant, it is often necessary to comply with the same regulations in place locally for insurance agents. This can include obtaining a valid license to broker insurance policies of different types. By requiring a licensing process, local jurisdictions can ensure that the quality of the consulting will allow clients to be acquainted with vital information that could affect their decision in regard to various insurance packages and programs.

An insurance consultant is usually compensated in one of two ways. One option is known as fee-based or fee-only. This option allows the consultant to collect a one-time fixed fee for his or her services. There is no percentage commission made from the sale, nor any type of ongoing commission generated as long as the policy or policies are in effect. Once the fee is paid, the consultant can focus on other clients and projects.

Commission-based compensation is the second option employed by insurance consultants. This model allows the consultant to collect compensation based on a percentage of the total value of the insurance package that is purchased by the client. In some cases, the consultant will continue to collect a small commission for as long as the coverage is in force.

The ultimate goal of an insurance consultant is to make sure the client receives the highest quality of insurance coverage for the most reasonable outlay in premiums. This often means balancing the insurance needs of the client with the amount of insurance premiums the client can reasonably afford to pay. While an insurance consultant can choose to take on individual and corporate clients, it is more common for the consultant to focus on the business sector or the private sector when seeking new clients.