What Insurance Brokers Do and If You Need One
Updated: 31 Jul 2025
While an insurance broker can help you find suitable coverage, in some cases, you might not need one.
Written bySingSaver Team
Team
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Finding the right insurance in Singapore can be a complex task, but getting quotes from various insurers is a smart move, whether you're seeking coverage for your home, vehicle, or even your pet. While online comparisons are convenient, an insurance broker can offer personalised guidance. Insurance brokers play an increasingly vital role in simplifying the process of finding the right coverage, especially for intricate needs like health, travel, and property protection.
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What is the role of an insurance broker?
An insurance broker connects individuals or businesses with insurance providers, and their main responsibility is to help clients find suitable insurance policies for their specific needs and financial situations.
It's also important to distinguish between insurance brokers and insurance agents. While brokers represent the buyer, searching across various insurers to find the best fit, agents typically represent specific insurance companies.
At the same time, it’s important to note that a broker fee may apply for their services. However, even with this fee, you might achieve overall savings. For example, if a health insurance broker secures a plan that saves you S$200 annually for three years but charges a S$100 fee, you'll still save S$500 on your health insurance in the long run.
When is an insurance broker beneficial?
While not everyone requires the services of an insurance broker, they can be particularly beneficial in certain situations. Using a broker is often a matter of personal preference, but they’re most helpful for those with more complex insurance needs, such as individuals requiring multiple policies, businesses seeking comprehensive coverage, or those considering the best high-risk auto insurance companies.
>> MORE: Term vs. whole life insurance
You might find an insurance broker beneficial if you:
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Have diverse insurance needs, such as combining life, health, and property insurance.
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Want to compare policies from various insurers efficiently to secure the best value and coverage.
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Need a thorough explanation of policy details, including exclusions, limitations, and specific terms.
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Are a business owner in need of commercial insurance solutions.
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Prefer personalised advice and tailored risk management solutions without investing significant time and effort yourself.
Since a key advantage of working with insurance brokers is their specialised knowledge, it's wise to consult a broker with expertise in the specific type of insurance you need. For example, seek out a broker specialising in health insurance for your health coverage needs or a property insurance broker for your property insurance requirements.
It's also important to note that when purchasing complex financial products like whole life insurance, consulting a fee-only financial advisor is often recommended.
How are insurance brokers paid?
It's important to understand how insurance brokers are compensated to ensure transparency and protect yourself from potential conflicts of interest. Generally, brokers are compensated via commission from the insurer. However, they can also charge a fee for their services in some cases, depending on the policy and the broker’s business model. So, while they’re discussing insurance coverage details, always clarify how your broker will be paid.
Commissions
When an insurance broker places you with an insurance company, they typically receive a commission from that insurer. This commission is usually calculated as a percentage of the policy premium, and the amount can vary according to the type of policy and the insurance provider.
Commissions may differ between the initial policy and renewals. For example, brokers may receive a higher commission on the first year of a policy. In the case of life insurance brokers, this initial commission can be substantial. Due to this, when considering complex and expensive products such as term life insurance, it’s advisable to consult a fee-only financial advisor.
While this commission structure exists, insurance brokers also have a vested interest in your satisfaction and policy retention. For instance, if a policy is cancelled early, they may be required to refund a portion of the commission to the insurer. At the same time, the commission is typically included in the policy's price.
Also, since insurance brokers work with multiple companies, they should theoretically remain impartial. However, some insurers may offer bonuses or incentives to brokers for bringing in more business. Therefore, it’s crucial to ask your broker upfront about how their commission structure works.
Insurance broker charges
In addition to commissions, some insurance brokers may charge separate fees for their services. These fees can cover services such as consulting, policy management, or risk analysis.
In Singapore, it's worth noting that industry practise often dictates that service fees are not directly charged to the client—remuneration typically comes from the insurance company. However, broker fees, if applicable, should be reasonable and clearly disclosed to you.
Insurance broker vs. independent agent
In Singapore, the terms "insurance broker" and "independent agent" are often used interchangeably, but they have distinct meanings. It's easy to see why they might be confused—both facilitate insurance transactions and typically earn a commission. However, a key difference lies in who they represent.
Independent agents work with multiple insurance companies, but they have contractual agreements that limit the policies they can sell. Also, they may represent the insurance companies. On the other hand, insurance brokers represent individuals or businesses seeking insurance. Additionally, brokers are not tied to specific insurers, giving them the flexibility to source a wider range of policies.
While both brokers and agents earn commissions, which might incentivise them to sell more coverage, they also prioritise customer service to maintain their business.
Brokers, representing the buyer, have a broader scope to find suitable coverage across different providers. In contrast, agents, while offering expertise on their specific products, have a more limited selection.
Compare insurance quotes
Get car, travel, home, and health insurance quotes from different providers. Compare coverage inclusions and premiums to find the best insurance for your needs.
Other ways to acquire insurance
Besides using an insurance broker, there are several other avenues to explore for your insurance needs.
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Directly from Insurance Companies: Purchase insurance online or over the phone.
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Through a Captive Agent: Buy insurance from an agent who works for a single insurance company.
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Through Comparison Websites: Use SingSaver’s online platform to compare insurance policies from various providers. Even if you’re working with an insurance broker, you can still use our comparison tool to ensure that you’ll get the best value for your money.
>> More: Compare car insurance quotes
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About the author
SingSaver Team
At SingSaver, we make personal finance accessible with easy to understand personal finance reads, tools and money hacks that simplify all of life’s financial decisions for you.