The Most Common Misconceptions About Insurance Brokers

When people think of an “insurance broker,” they often picture someone trying to upsell policies or add unnecessary fees. However, this outdated image doesn’t reflect the modern, highly regulated, and professional service most brokers provide today.

Insurance brokers are experts who act on behalf of clients, not insurance companies. They work to find the right coverage for your specific needs, whether that’s for personal, business, or specialist insurance.

Despite the many advantages of using an insurance broker, a number of myths continue to circulate. These misconceptions can lead people to avoid brokers altogether, potentially missing out on better protection and value.

This article explores the most common misunderstandings about insurance brokers, shedding light on the real benefits they offer and helping you make more informed decisions when choosing your insurance options.

Misconception 1: "Brokers Are More Expensive Than Buying Direct"

This belief is widespread, but the truth is more nuanced. Many people assume that using an insurance broker means paying higher premiums or additional fees, but that’s not always the case.

Broker Fees vs. Value for Money

It’s true that some brokers charge a service fee, but many are compensated through commission paid by the insurer. This doesn't necessarily result in a higher cost for the client. In fact, brokers often help secure better deals than you might find on your own.

Because brokers work with a wide range of insurers, they can compare a broader selection of policies. They look beyond just price, factoring in coverage quality, exclusions, and support services, helping you avoid policies that may appear cheaper but offer less real value.

Transparent Costs and Hidden Savings

When you purchase directly from an insurer or through a comparison site, you might not see the full picture. Many low-cost policies include significant exclusions or high excess fees that only become apparent when you need to make a claim.

Insurance brokers help you understand these elements upfront. They can explain what's covered, what isn’t, and how the excess applies, giving you a clearer idea of what you’re really paying for. This transparency can often lead to cost savings down the line.

Long-Term Financial Benefits

By ensuring your policy is suitable from the start, brokers help prevent issues later on — such as denied claims due to inaccurate details or insufficient coverage. This proactive approach can save you thousands in the event of a loss.

In short, a broker’s role isn’t just about finding a price — it’s about finding the right protection. That kind of security often outweighs the misconception of extra cost.

Misconception 2: "Brokers Only Push Products They’re Paid to Sell"

Some people believe insurance brokers are biased toward certain providers due to commission arrangements. While brokers do earn commission on many policies, this does not mean they are incentivised to mis-sell or push unsuitable products.

In the UK, insurance brokers are regulated by the Financial Conduct Authority (FCA), which requires them to act in the client’s best interests. This includes conducting a fair analysis of the market and recommending policies that genuinely meet your needs.

Most professional brokers value their reputation and client relationships far more than a one-time commission. They thrive on repeat business and referrals, which means they’re motivated to provide honest, tailored advice that delivers results over time.

In fact, many brokers specialise in certain areas of insurance, allowing them to give expert guidance that comparison sites and direct insurers simply can’t match. They take the time to understand your risks and recommend policies accordingly — not based on the highest-paying provider, but on what’s most suitable for you.

Misconception 3: "I Can Just Use a Comparison Site Instead"

Comparison websites are useful for quick quotes and simple policies, but they don’t offer the depth of service a broker does. They rely on algorithms and limited information, which can lead to misleading results if your needs don’t fit neatly into predefined boxes.

For example, if you own a listed property, run a home-based business, or require multiple cover types, comparison sites may fail to show relevant options or important policy conditions. A broker, by contrast, can ask deeper questions and interpret your situation more accurately.

Additionally, brokers have access to policies and insurers that aren’t available to the public or visible on comparison websites. These “broker-only” options are often more comprehensive and competitively priced.

Another crucial difference lies in claims support. If something goes wrong, a broker will assist you throughout the claims process, helping to avoid delays or disputes. Comparison sites offer no such service — you’re on your own once the policy is purchased.

Ultimately, while comparison sites can be convenient, they aren’t a complete solution — especially for complex or non-standard insurance needs.

Other Misconceptions That Might Stop You Using a Broker

Beyond the big three myths, there are several other ideas that might discourage someone from speaking to an insurance broker. Let’s take a look at a few of these and explain why they don’t hold up under scrutiny.

"Brokers Are Only for Big Businesses"

It’s easy to assume that brokers only deal with large firms or wealthy individuals. In reality, brokers serve clients from all walks of life — from sole traders and landlords to young drivers and first-time homeowners.

Whether you need home insurance, tradesman cover, or public liability insurance for a start-up, brokers can offer advice and tailored policies that reflect your unique situation. They’re particularly helpful when your needs don’t match a standard insurance template.

"I Already Have Insurance — I Don’t Need a Broker"

Having a policy doesn’t guarantee it’s the right one. Insurance is not a “set it and forget it” product — it should evolve as your circumstances change. A broker can review your current policy to make sure it still fits and recommend updates if needed.

For example, if you’ve recently renovated your home, changed your car, or taken on new business activities, your policy may need to be revised. Brokers are trained to spot such gaps and help you avoid being underinsured.

"Brokers Just Add a Middleman"

This misconception overlooks the value that brokers bring to the insurance process. Yes, they sit between you and the insurer — but they work for you, not the insurance company.

Instead of adding complexity, brokers simplify the experience. They translate technical jargon, handle paperwork, and negotiate terms on your behalf. When a claim arises, they can provide crucial guidance, giving you peace of mind and a much smoother process.

Additionally, many brokers have long-standing relationships with insurers. This can lead to more flexible underwriting and even better treatment than a direct customer might receive.

"Brokers Don’t Understand My Industry"

Many brokers specialise in specific sectors such as construction, hospitality, retail, or healthcare. These specialists understand the risks unique to those industries and can recommend cover that a generalist — or an algorithm — might miss.

If your work involves unique risks or compliance issues, using a broker who understands your field can make a big difference. You’ll get more relevant cover and often better pricing too.

"I’ll Be Pressured Into Buying Something"

Ethical brokers don’t use high-pressure tactics. Instead, they aim to educate clients and explain options clearly. You’re under no obligation to accept their recommendations, and a good broker will respect your right to compare or decline their services.

In many ways, a broker is more like an advisor than a salesperson — and the best ones prioritise your understanding and confidence over closing a sale.