What is the difference between an independent insurance agent and a direct (captive) agent?

A captive (direct) agent works exclusively for one company and sells only that company's policies. An independent agent represents several companies and can offer clients multiple quotes, which is why customers often choose an independent agent for a personalized approach to comparing coverage. Independent agents typically earn higher commissions, around 15% on new auto and home policies versus 5% to 10% for captives, but they cover their own business expenses.

An independent agent sells policies from several insurance companies, while a captive (direct) agent works exclusively for one company. Brokers, a third category, represent the client rather than the insurer. Compensation also differs: captive agents typically receive a salary and benefits with lower commissions, while independent agents earn higher commission rates but no salary or benefits.

A captive agent works for a single insurance company, while an independent agent represents several companies and can offer clients multiple quotes. Captive agents sell one insurer's products exclusively. Independent agents choose among the insurers they represent, and Kentucky law requires each insurer to appoint every agent acting on its behalf, filing the appointment within 15 days of the contract.

An independent insurance agent represents multiple insurers and can offer quotes from several carriers, while a captive (direct) agent works for one insurer and sells only that company's products. Captive agents typically receive a salary, benefits, training, and carrier marketing support, but earn lower commission rates. Independent agents earn higher commissions and choose their own carriers, but they receive no salary or benefits and cover their own startup costs.