Legal definition of broker
Insurance Litigation Legal Terminology


"Broker" means a person lawfully engaged in the business of effecting transactions in securities or commodities for the person's own account or for the account of others.

Each country and state has its own broker regulations. Broker usually acts as a liaison between a buyer and a seller, whether it is a house, an insurance policy or a business purchase.
All states require a broker to be a licensed professional. To obtain a license a potential broker must pass a written test.

A broker owes a fiduciary duty to the owner/or buyer to act according to the owner's/buyer's instructions, and in the best interest of the owner, notwithstanding the manner in which the broker is compensated.
(The Arizona revised statutes, Chapter 1, A. 2, S.14-7651)
Source: The Arizona Revised Statutes. website
A broker is an individual or party (brokerage firm) that arranges transactions between a buyer and a seller, and gets a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Distinguish agent: one who acts on behalf of a principal.
Source: Wikipedia - The Free Encyclopedia. website. license
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