The answer depends on your needs and wants. The younger population seems to navigate to the convenience of online insurance shopping, while the older generation tends to stick with calling their trusted insurance agent or broker.

Let's compare the pros and cons of using an online, automated insurance quoting tool, versus speaking directly with a licensed specialist, such as a broker.

Buying Insurance Through A Broker Or Agent

Using an insurance broker or agent is like having your own personal assistant when buying insurance. Typically an agent sells for only one insurance company, while a broker represents insurance products from multiple insurance companies.

Refer to our article "What's The Difference Between An Insurance Company And An Insurance Broker?" to learn about the differences between agents and brokers. For the purpose of this article, we will focus on insurance brokers.

Most people have the goal of securing a policy that has the most valuable coverage at the most affordable rate. Buying insurance through a trusted, experienced broker can help guide you in the right direction.

The Process Of Buying Insurance Online

Buying insurance online can seem simple compared to speaking with a broker directly. It often takes less time to get through the quoting process, which more or less entails the user finding an online quoting engine, entering their information for the type of insurance they are seeking, and receiving a quote within minutes.

In terms of protecting personal information, all websites that require confidential data, such as social insurance or credit card numbers, are required to work off a secure sockets layer (SSL).

This is the standard security technology that establishes an encrypted link between the web server and the user’s browser. There are also federal laws in Canada that companies collecting personal information must abide by (ie. Personal Information Protection and Electronic Documents Act - aka “PIPEDA).

Online insurance engines prompt users to enter personal information like postal code and date of birth. Depending on what type of coverage is being quoted (ie, auto, home, life), the user will be required to fill in specific types of data. For example an auto insurance quote may require the vehicle’s year, make and model, the driver’s license number and information about any family members who will be driving the vehicle.

Once all of the required information has been entered and qualifying questions have been completed, the quoting engine’s algorithm displays several quotes to compare and choose from. The user can select an option based on price, value and coverage options. Once online payment is submitted, normally the policy becomes official and documents can be printed instantly.

Advantages of Buying Insurance Online

Benefits of buying insurance online include:

• Convenient process - buying insurance online is quick, easy, efficient and can be done anywhere at anytime.
• You can initiate and complete a quote on your own time.
• There is less pressure from dealing with a “real” person.
• You can compare prices across multiple carriers yourself.
• Policy can be somewhat tailored to your needs.
• Generally, insurance policies can be downloaded immediately.

Disadvantages of Buying Insurance Online

Even though most insurance companies permit purchasing a policy online, it doesn't mean the customer has the knowledge to determine if they're getting a good policy. Even with the ability to  compare multiple coverage options on the same website, an online quote service can never replace the value of a local independent insurance broker.

Online quotes are appealing for their convenience, but sometimes convenience comes at a cost. Here are a few drawbacks of buying insurance online:

• Communicating with a real person when needed can be more challenging (ie. when trying to make a claim).
• Never talking to the same person twice means an impersonal experience, with little chance of getting to know your personal situation or needs.
• You may not be able to speak with an online customer service representative who’s experienced and licensed, nor have access to someone to advocate for your best interests.
• Making changes or getting issues resolved without a broker can be frustrating and time-consuming.
• Convenience may only be an “upfront” feature, as trying to reach someone via chat bot, email, or toll-free numbers with phone prompts is the likely scenario AFTER you’ve already purchased an online policy.
• It may be more difficult to truly understand the ins and outs of your policy, including things you think you’re covered for but may not be.
• It’s up to YOU to read all of the fine print and understand exactly what you’ve purchased.
• Prices presented upfront aren’t always the prices secured in the end.
• Online agencies are not obligated to provide the best policy for your unique needs or circumstances.
• Most online insurance providers will have you sign a “Waiver of Liability”, basically releasing them from any responsibility if you later find that the insurance wasn’t suitable for your needs.
• Some online insurance marketplaces can sell your data, which may lead to you being bombarded with spam email.

Online Quotes Might Leave You Paying Too Much

Part of the problem with online quoting engines is that they aren't able to communicate with the underwriting departments of various life insurance companies. They can’t do a personalized pre-qualification before submitting an application. It’s simply a computer program generating insurance quotes. There’s a good chance you’ll receive a phone call somewhere along the line, depending on how the online system is set up. Many times someone will still call to verify the information provided and potentially review the coverage in question.

In this scenario, we’ll use life insurance as the product. Once you’ve answered a few basic health questions online, it doesn’t guarantee the quoted premium is accurate, nor does it mean it reflects the correct risk class customized to your particular health. When you encounter a “guaranteed issue” policy (ie. everyone between 18-65 is accepted with no medical exam), the premium may be much higher than what a broker could provide- afterall, an automated system is only capable of so much.“Guaranteed issue” is one way for insurance companies to minimize paperwork involved when issuing life insurance policies. The downside to the “everyone is accepted with no medical exam” notion is the insurer has to increase premiums on all policies. They take on more risk for not delving into your medical history, and you pay for that “benefit” with higher premiums.

Online systems don’t have an intuitive sense for which companies are better able to insure which risks. For example, some life insurance companies consider any smoking at all a risk and you will be put under the “smoker” risk classification. As a smoker, you will pay higher premiums than a non-smoker, assuming all other things are equal. Other life insurance companies allow you to smoke periodically (ie. celebratory cigar) without being classified as a “smoker.”

A broker can help you navigate the finer points of the underwriting process, ensuring that you’re classed properly and you don’t overpay for insurance coverage.

The Process of Buying Insurance Through A Broker

Insurance brokers are available by phone, email, or by physically stopping by their office during business hours. They'll get to know what type of coverage you're looking for, and will begin the quoting process by asking a series of questions.

They will input your data into a system and hand or email you a copy of the insurance quotes tailored to your needs. Since brokers work with multiple insurance companies, they will be able to provide several quotes for comparison, and recommend which one makes the most sense.

A licensed broker is obliged to walk you through each quote and through the positives and negatives of each policy. You can ask questions to better understand the information so you can make an educated decision. Once you’ve chosen a policy, it goes into effect once the first payment has been made.

Advantages Of Buying Insurance Through A Brokerage Vs Online

Since you’re able to deal with the same person at an insurance brokerage, your representative is able to get to know you. This better helps them find an insurance package suitable for you, and let you know if any new products come to market that make sense for you. Insurance brokers are not only experts in the insurance industry, but they also know how to shop multiple carriers to make sure you're getting the best price possible.

Brokers basically become advocates for you and your insurance needs. Should you be in an accident or need to use your insurance, your broker is there to help you make a claim and get you through the process as quickly and seamlessly as possible. More benefits of working directly with a broker include:

• Long-term relationships with customers and reputation are keys to the success of an insurance broker. Working with a broker allows a relationship to be built- a human connection who becomes familiar with YOU.
• Brokers don’t carry contractual obligations with any one provider, meaning  they can reach out to any number of insurance companies to find the best fit and least expensive policy for their client’s custom needs.
• An insurance brokerage employs expert brokers. Brokers work closely with clients to find the right coverage for them. The broker examines the terms and conditions of several options, and recommends an insurance policy that best suits the client’s needs at the best price.
• Brokers must maintain full licenses in their respective provinces, which means they are required to complete annual training hours. This generally means brokers have the most up to date knowledge in the insurance marketplace. Their knowledge base tends to be diverse, as well, as they deal with a large number of markets.
• Brokers are licensed to sell multiple products, allowing their consumers a package deal like home, auto and life insurance at a discounted premium.
• Brokers are required to provide full disclosure on commission rates and the effects the rates may have on the insurance premium.
• At the point of sale, a broker will provide a statement that outlines how much of the premium will go towards commission, which helps consumers make a more informed choice when shopping for insurance.  
• Brokers are often independent businesses, with a competitive advantage of having in-depth knowledge of the evolving insurance landscape and available services.
• Many brokers work for smaller companies that represent big insurance companies, which means their service is typically more personalized, with better quality support.
• Brokers will help you understand different insurance terms and coverages.
• A broker can assist you at any time throughout your policy if you have any issues, changes, or need to file a claim when disaster strikes.
• Most brokers can complete an insurance policy and provide insurance documents in less than 24 hours. This can vary based on the insurance company and the type of insurance being purchased. In some cases, official documents can be provided immediately. In other cases, a ‘binder of insurance’ might be provided, which is an interim document guaranteeing coverage.
• It’s generally easier and faster to get in touch with your broker versus using an automated online system with bots and auto prompts.
• They will provide an annual renewal reminder and ask if there have been any big changes in your life that may change the insurance coverage you need.
• They will review your policy to make sure it still makes sense and is the best deal for you.

Disadvantages of Buying Insurance Through A Broker Vs Online

Buying insurance online can be quicker and easier compared to going through a real person at a brokerage. Additional drawbacks of buying insurance through a broker are:

• A client must shop for insurance during business hours, which are typically Monday through Friday from 9am to 5pm, which may not work for some people.
• The quote has to start and finish on the broker’s time.
• There’s not as much personal control over the insurance quoting process.
• It can take longer to bind a policy, depending on the syncing of client and broker schedules.

Summary - The Key Advantages Of Working With A Broker

While buying insurance online is often quicker, easier and more convenient, it’s always good to know your options. The main benefit of going through an insurance broker is choice. Brokers tend to be one-stop shops, as they can compare different providers’ plans and rates and offer you the best unbiased option — whether that’s the least expensive plan or the product perfectly tailored to your unique needs.

Brokers can also find discounts that you’re not as likely to discover on your own. For example, you can save on auto insurance if you put winter tires on during a specified period, or if you insure multiple vehicles on the same policy. They can also provide multi-line quotes, like home and auto, and let you know what kind of savings you could receive.

At a brokerage, you’ll often deal with the same person to find each kind of insurance product you need, which can be more convenient than dealing with numerous providers. A broker will provide advice about when it makes sense to file a claim, or if it makes more sense to pay out of pocket. They’ll let you know what a claim will do to your future insurance premiums and deductible. If you do file a claim, they will deal with the insurance company on your behalf, saving you time and stress.

Choosing between an online insurance quote or working directly with a brokerage involves weighing pros and cons, while understanding your unique insurance needs. Best Buy Insurance is an insurance brokerage that operates with multiple carriers, so you can rest easy knowing you will receive the best policy at the best price.

We also have a dedicated team of licensed representatives and support personnel who are always ready and willing to help answer any questions you may have — during the quoting process and beyond!

If you're looking for insurance coverage from a trusted broker, discover why people in Ontario have relied on Best Buy Insurance for over 60 years. You can find the best insurance rates online or by calling Best Buy Insurance at 855-967-3571.

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