Independent insurance agency Insurance Navy has cited a survey finding growth in the number of independent agencies as evidence of the downturn of the captive model.
A 2010 survey from Future One – a cooperative effort of the Independent Insurance Agents & Brokers of America – said that the number of independent agencies grew to 38,500 in 2010, up from 37,500 in 2006.
"The tumults that prevailed in the financial markets and the credit industry have caused many captive carriers and agents to alter their rating and customer service models, which triggered consumers to shop out of their current captive agency system," Ed Sneneh of Insurance Navy said.
"Some financial professionals – including insurance agents of captive of insurers – are finding the independent agency system more profitable to take as a career," he added.
"The number of our agencies has grown by about 44 percent in the past 12 months and we have seen some other independent agents in the Chicago area growing at similar rates."
The firm argued that unlike captive insurance agencies working for one insurer, independent insurance agencies have the ability to represent multiple insurers, “allowing them to compete based on multiple factors, including lower insurance rates, better coverage, diversity of coverage, etc.”
