State Farm, Allstate, and Geico are all insurance companies that will only sell their products through their agents. They don't permit their agents to sell any products from any other insurance companies. Hence the word captive. These agents are captive to a single insurance company.
What is captive agent in insurance?
Captive (sometimes referred to as dedicated) agents are insurance producers who work for one company and sell one company's products. Conversely, independent agents work for multiple companies and can sell multiple different types of products to their customers.
Who are captive agents?
A captive agent is an insurance agent that works for only one insurance company. Captive agents only sell the products of the insurance company they work for and cannot help individuals outside of that offering. The opposite of a captive agent is an independent agent that works for many insurance companies.
What are the different types of captives?
Risks can be first-party or third-party, and companies can be creative in how they utilize their captive programs. Entities with captives are diverse in scale and risk profile and include Fortune 500 companies, private companies, and non-profit organizations.