Direct Insurance
When buying insurance one can either work through an agent or broker, or by contacting the insurance company directly. The latter is called direct insurance as no intermediary is involved in the process. The term Direct Insurance is also used where there is no reinsurance applicable.
A direct writer/insurer will have direct dealings with the public through their own sales force, direct mail, via the telephone or internet; that is, no independent agent or broker will be involved in the process. Agents working exclusively for an insurance company are called captive agents and they are also classified as direct writers.
Whether one make use of an insurance intermediary or deal with the company directly will largely depend on personal circumstances and insurance needs. If one’s insurance needs are complicated it may be the best option to work through a specialist broker who knows all the products available on the market. As an example, if you have a number of vintage cars to insure rather go the specialist route.
All insurers and their agents as well as any independent insurance brokers must be licensed as qualified financial services providers under the Financial Advisory and Intermediary Services Act (FAIS.)
A direct account or direct business refers to the actual business placed with the insurance company without the involvement of any intermediary.