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Financial Professional vs. Insurance Agent: What They Do and Which is Appropriate For You

Financial Professional vs. Insurance Agent: What They Do and Which is Appropriate For You

June 26, 2023

Planning for your future requires the help of multiple professionals. Two professionals you may find yourself working with to figure out your future are a financial advisor and an insurance agent. Financial professionals may also provide the services of an insurance agent. However, you may prefer two separate professionals providing different services. To determine which professionals you will need, it’s essential to learn what each one does and how they can help.

Financial Professionals

Financial professionals advise you on a broad range of topics involving financial goals and your financial future. They may help you with budgeting, planning for college, estate planning, savings, investments, and retirement planning. Different financial professionals may hold different certifications, but all of them can assist you with various financial needs. Some may also have certifications that allow them to sell insurance products, but not all advisors perform this function, though they may offer recommendations regarding insurance.1

Insurance Agent

An insurance agent will provide you with insurance products you may need, whether for future planning or to protect your current assets. Insurance agents will often be licensed to sell life insurance, health insurance, long-term care insurance, disability insurance, or home and auto insurance. Some may offer multiple products, while others may specialize in specific areas.1

How do Financial Professionals and Insurance Agents Differ?

Insurance agents are licensed to sell insurance products. Financial professionals may or may not sell insurance. If they do so, it may be in one of two ways. If they are licensed, they may sell products directly to you based on the needs determined in your financial planning. They also could recommend various insurance products and recommend a licensed insurance agent able to sell them.2

Should You Buy Insurance From a Financial Advisor or an Insurance Agent?

Both financial planning and insurance are crucial when working toward a strong financial future. Deciding whether to use one professional for both or opting to separate these two

needs may depend on how your financial professional charges for services and what services you need. A financial professional will advise you on several financial areas, including insurance recommendations. If you choose to separate the two, then you would benefit from discussing insurance needs with your financial professional first before contacting an insurance agent.1

Financial planning and insurance go hand in hand. Therefore it is always a good idea to involve your financial professional in discussing your insurance needs to ensure they align with your future financial plans.







Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy. This article was prepared by WriterAccess.

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Footnotes:

1 Do I Need a Financial Advisor or Insurance Agent? yahoofinance.com, https://finance.yahoo.com/news/financial-advisor-insurance-agent-130009624.html

2 Financial Advisor vs. Insurance Agent: When Do You Need One? Smart Asset https://smartasset.com/financial-advisor/financial-advisor-vs-insurance-agent