Which of the following is a channel through which insurance policies are distributed?

Which of the following is a channel through which insurance policies are distributed?

• A. American Agency system
• B. Direct writing system
• C. Brokers’ network
• D. Direct mail marketing

Answer: (A)

Policies are distributed through channels that rely on intermediaries or direct approaches. The American Agency System uses agents who represent insurers and sell policies to customers, forming a network that provides local presence, personal service, and ongoing agent–customer relationships, with agents usually paid by commissions. This model is a classic way insurers reach markets through a structured agent network. The other options describe different approaches: direct writing uses company employees to sell policies, brokers’ networks connect clients with multiple insurers via brokers, and direct mail marketing is a direct-to-consumer tactic.

Policies are distributed through channels that rely on intermediaries or direct approaches. The American Agency System uses agents who represent insurers and sell policies to customers, forming a network that provides local presence, personal service, and ongoing agent–customer relationships, with agents usually paid by commissions. This model is a classic way insurers reach markets through a structured agent network. The other options describe different approaches: direct writing uses company employees to sell policies, brokers’ networks connect clients with multiple insurers via brokers, and direct mail marketing is a direct-to-consumer tactic.