American Agency System
Definition of "American agency system"
Marketing of insurance through independent agents; also called independent agency system. Independent agents usually represent several insurance companies and try to insure the risk according to availability of coverage and most favorable price. Independent agents are paid a commission in the form of a percentage of the premiums generated by the policy sold. They own all the records of the policies sold and have the right to solicit renewals. They are not restricted to maintaining business with just one company and can transfer the business upon renewal to another company.
Popular Insurance Terms
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Central (main) office of an insurance company whose facilities usually include actuarial, claims, investment, legal, underwriting, agency, and marketing departments. ...
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Method of selling insurance in which the insured purchases the product directly from the insurance company and not through an agent. ...
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