There are two main types of insurance companies in South Africa namely long
term insurance companies which sell
life insurance,
annuities and pension plans and
short term insurance
companies which sell motor, home and business insurance.
Direct insurance companies in South Africa sell their products directly to the public
via agents who work in their call centers. These companies actively advertise their
products on TV, radio and in the press as they do not have brokers selling their
products. Short term insurance is more popular with direct insurers as they are
able to provide their services via the phone.
Traditional insurance companies provide both short term and long term insurance
products and rely on a network of
insurance brokers
who sell their products for them.
Insurance brokers in South Africa are independent and work for their clients. They
source
insurance quotes from various insurance
companies and present them to their clients. Should the client purchase one of these
insurance policies the broker then earns a commission from the insurance company.
Often insurance brokers provide invaluable advice regarding insurance products and
companies.