Guide to Changing Insurance Brokers
21st June 2023
Before we start, let's define clearly the differences between a broker and an agent, two types of intermediaries that are often mixed up. Simply put, a broker can work with many insurers and compare plans across different providers on behalf of the client; whereas an agent usually works for one insurer only to sell the products on behalf of the insurance company.
In this guide, you’ll learn how to change insurance brokers, why you might want to do it, and what characteristics to look for in your new broker.
Why change insurance brokers?
Perhaps your broker does not instill confidence in you. Maybe they didn’t seem to understand your requirements, didn’t advocate for your claims in a satisfactory way, delivered subpar service, were difficult to get a hold of, or gave you poor advice. Or it could be that your insurance needs have changed and your current broker just doesn’t have the expertise you need now. These are all valid reasons you might want to change insurance brokers. The good news is that changing insurance brokers is simple.
In more severe cases, if there has been misconduct on your broker’s part, you might wish to file a complaint with the brokerage company. If the company fails to handle your complaint in a satisfactory way, your next move would be to file a complaint with the Insurance Authority and, if the complaint is monetary in nature and does not exceed HK$1,200,000, the Insurance Complaints Bureau.
When is the best time to change brokers?
You can change insurance brokers at any time, although policy renewal time might seem like a natural time to make the switch. If you change brokers during the policy year, you’ll need to write a letter of appointment (LOA) to let the insurer know about the change and make it official.
One advantage of switching brokers before renewal time is that your new broker can review your existing coverage and recommend changes as needed (for example, they might recommend changing insurance providers or amending your current policy).
How do I change insurance brokers?
If you have found a new broker you wish to work with and want to switch over to them, you will need to communicate your decision to the insurance company through the new broker.
The new broker should talk you through what you need to do to make the change official. For example, you will need to write a letter of appointment declaring that you wish to appoint the new broker to take over matters related to your policy. Your new broker will then forward this LOA to the insurance company.
The new broker should be able to provide you with an LOA template, which should include details about your policy, the date of the handover, and a written confirmation of the new arrangement (i.e., that your new broker will now manage your policy and that you are terminating your arrangement with your old broker).
What should I look for in an insurance broker?
To assess if a broker is the right fit for you, here are some questions you can ask.
- What makes them different from your last broker?
- After you’ve purchased a policy, how will the broker help you during the policy year?
- Would they be able to help you quickly with claims?
- What insurance providers do they partner with?
- Do they specialize in the type of insurance you’re looking interested in?
- What is their reputation? What do clients think about them?
- Do they have case studies that reflect your needs?
- Does the new broker work with your insurer?
- What is their fee structure, if any?
Read more: 9 questions to ask your insurance broker in Hong Kong
How do I find a new insurance broker?
If you’re looking for an insurance broker that specializes in health insurance and life insurance, get in touch with Alea. Our partnerships with international and local insurers mean we will provide you with the right insurance solutions for your needs and budget.
Whether you need insurance for yourself, your family, or your employees, we take pride in our comprehensive, high-quality after-sales support and service. We’ll advocate on your behalf when it comes to claims reimbursements and support you in the event of hospitalization. At Alea, we are committed to your health and well-being.
Save time, money & worries on your insurance. Contact us!
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| Choice of 25+ insurers at the best price | |||
| Choice of 25+ insurers at the best price |  | |  |
| Extensive audit of your current insurance | |||
| Extensive audit of your current insurance | | | |
| Unbiased advice | |||
| Unbiased advice | | | |
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| Dedicated customer care all year long | | | |
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FAQ
Can I keep the same policy if I switch brokers?
Yes, your policy remains yours if you switch insurance brokers.
Are there any fees or penalties for changing brokers?
There shouldn’t be any fees or charges arising from changing insurance brokers. That said, it’s a good idea to ask the new broker directly about their fee structure before you switch over to them. Keep in mind that your premiums may increase the following year if you make changes to your policy or change insurers or simply due to medical inflation.
Do I need to inform my old insurance broker about the switch?
No, you aren’t required to inform your current broker that you’re switching to a new broker, though you may wish to do so as a courtesy. After receiving your LOA from the new broker, the insurance provider will inform your old broker of the change. Once the change is done, your old broker will no longer have access to your policy, nor will they know which broker you have switched to.
Your old broker might reach out to you to ask you for feedback. If you feel comfortable, you can volunteer your feedback to help them improve their service. Of course, this is up to you.
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This article was independently written by Alea and is not sponsored. It is informative only and not intended to be a substitute for professional advice and should never be relied upon for specific advice.
