Analysis of Brokers in the Insurance Industry

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Foundation Skills in data Analysis
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Analysis of how the Presence of Brokers in the Insurance Industry has Influenced Auto-Customers
Executive Summary
There has been a significant growth in the number of brokers engaging themselves in the insurance
business in the Auto-industry. The data presented indicate how various brokers have influenced a sample
of 400 consumers in the auto-industry. The specifically focuses on how the availability of brokers and
other factors affect the saving or loss they may incur from insurance premiums. According to the analysis
done on the data, the presence of a broker as mid-man between the customer and the insurance company
can lead to a consumer saving some significant amount of cash from the annual insurance premiums,
experience a loss or just break the even. The category under which a customer falls is however, dependent
on the performance of the broker. A broker can either be high performing, average performing or low
performing. On an annual basis brokers can lead a consumer to saving from insurance premiums an
approximate amount ranging between $198.1 to $261.68 dollars. From the sampled population above
60% of the insurance firm customers are satisfied with the presence of brokers in the industry. The
greatest percentage of the satisfied customers of the female gender and people who leave in rural areas.
For the past two years the average annual saving has been within $260. More than 40% proportion of men
are likely to seek broker services. If a study was to be conducted a follow up article sample sizes of 158
and 385 would be appropriate to examine the average amount brokers save on car insurance and the
proportion of comprehensive insurance policies.
Analysis and Interpretation
1. Summary of The Annual Car Insurance Premiums Saved by Consumers from Broker
Services.
The growth of the number of brokers providing brokers services and acting as a middle-man
between the insurance companies and the vehicle owners has shown positive impact in terms of
assisting customers to save on the amount that would have been used to purchase insurance
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premiums. An analysis of the sample data provided indicates that on an annual basis there is a
95% level of certainty that a customer in the Auto-industry can save between $198.81 and
$261.68. This kind of saving creates the relevance of presence of the brokers in the insurance
industry by making customers appreciate their services hence consult them more and in turn
leading to a boom in the brokerage services.
2. Individual Brokers Performance based on Amount a Customers Saves.
Despite assisting customers to save substantial amount of cash from the amount they would have
initially utilized in purchasing of premiums, brokers perform differently. There are those who
perform exemplary, those who perform on an average level and there are low performers.
Looking into the average annual savings customers incurred from various brokers, it is clear that
the best performer all the brokers is broker number two, broker number three follows and is
proceeded by broker number one. The least performing broker is broker is broker number four. A
consideration of saving as the only factor that influences customers choice for a broker would
mean that more customers would be more satisfied operating under broker number two, one,
three, and lastly four respectively.
3. Satisfaction of Customers with Brokering Service.
Overly above 60% of the sampled population of individuals are satisfied the services of brokers
in the insurance industry. Of the 40% proportion of the sampled population, 25% consist of
individuals who are neither satisfied nor dissatisfied, the 15% represent the proportion of
individuals who are not satisfied at all. The rate of satisfaction depends on various factors such
gender and location of residence of the customers. The greatest proportion of satisfied individuals
comprise of the female gender as compared to the male gender. Moreover, people leaving in rural
areas are more satisfied with the role of brokers compared to the proportion of individuals leaving
in the urban areas.
4. Impacts of Various Factors on the current Insurance Premiums.
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