The insurance industry is unique and quite different from other business services. Insurance companies will only release one quote and work with one agent/broker for a particular business. This means that if you are shopping for insurance you will not receive quotes from the same company from different brokers. There are exceptions but 95% of insurance companies operate in this manner. The other 5% will release multiple quotes but they have to be identical. For more information please visit our insurance quote page that covers this topic.
This creates a situation where you have an insurance policy or quote that you like but it’s with an insurance agent or broker that you don’t. To alleviate this the industry has a process of shifting the insurance policy or quote from one agent/broker to another. This is called an agent or broker of record letter. For existing insurance policies this can be done at different times depending on the insurance company. Some will let you switch agents at anytime. Others will only honor the agent of record if its within 60 days of the expiration of your policy. For a quote this would be done before the policy or renewal policy is bound.
The agent/broker agent of record letter is a document on the insured or quoted businesses letterhead that includes the effective date, quote or policy number and some additional items. The letter must be signed by one of the insured or quoted business’s owner or officer. The letter is then sent to the insurance company for processing.
There is a waiting period assigned to agent of record letters which is typically 5 or 10 days. The waiting period is there to give the original agent time to contact the insured to make sure the letter was signed intentionally. If the letter was not signed intentionally the original agent will have the business sign a rescinding letter. It’s important to note that the waiting period can be waived by the original agent/broker. This request can come from the insurance company or by the insured/quoted business.
This process happens daily in the Colorado insurance marketplace. It’s common and helps customers choose products and agents/brokers that fit their business best.
Please contact us to discuss insurance and your business.
Thank you for your time.
The Orcutt Group Team