The broker is 100M+ away and we are dealing
over the internet. We have never met.
That's probably a big part of the problem. Answer the following questions:
1 - Where do you live (city)?
2 - Where is the house located (city)?
3 - What date does the current policy on the house expire? Or has it expired already? What's the name of the insurance company on the house now?
4 - What's the name of the insurance company that the broker wants to place you with?
5 - Why are you changing insurance companies and agents?
6 - How much coverage (dollar amount) are you asking for on the house and how much was the quote for?
7 - How old is the house?
8 - Condition of the house?
9 - Who lives in the house?
Answer all those one by one and I may be able to figure out what's happening and advise you better.
My big question is
"why the money first"?
Pretty much the same reason that you don't walk into a grocery store and walk out with a loaf of bread without handing over money first.
There is nothing strange about an agent being required to get the money first before the insurance company will issue the policy. That's pretty common, especially if the agent doesn't know you.
Many insurance agents have binding authority for some of their companies where they can bind the policy when they receive the money. But there are insurance companies (I used to work for one) that didn't allow that and wouldn't make the insurance effective until the money was received at the company level.
When you have an established relationship with an insurance company or agent you might be able to get a policy issued and get sent a bill.
There's nothing wrong with having to pay for the policy up front.
What bothers me is this application business. There's no reason an agent shouldn't be able to email you an application either before or after you get a quote, whether it's for you to fill out or one he's already filled out.
Bottom line, though, if you don't like the way this broker does business there are tons of insurance agents and brokers that would like to do business with you.