What’s the difference between a “captive” and an “independent” insurance agent?

There are 2 basic types of insurance agents that you can work with when choosing your insurance coverage, or when pursuing a career as an agent: ‘Captive’ or ‘Independent’.

Captive insurance agents sell policies for only one company. So Jake can only sell policies from State Farm and Flo can only offer you options from Progressive. Many large insurance carriers only utilize this type of agent. Captive agents are paid a salary as well as a commission for policies sold. Selling for only one carrier allows these agents to become very knowledgeable about their policies which can be a great advantage for the consumer. 

On the flip side, your policy options are more limited since the agent can only present policies available through that one carrier. Independent insurance agents sell policies for multiple insurance companies and are paid a commission for policies sold. Consumers usually get more options to fit their budget and needs through an independent agent, but with so many policy options available, these agents may not be as knowledgeable about the ins and outs of every policy.