Insurance brokers reconsider taking insurer commissions

(AOC, TRV, CB, MMC, WSH) Marsh paid the highest fines for a NY settlement, and other states may impose fines.  Same states may allow undisclosed fees in certain lines of insurance. Travelers is actively trying to restart a defined contingency fee and has apparantly stated guidelines per NU. The best policy is always full disclosure of all fees, however disclosing fees based on an unknown...

The matter of supplemental compensation for brokers continues to attract attention. It’s an important issue for the brokers because it impacts financial performance, acquisition and growth strategy, and client perceptions. However, while the middle-market brokers have made progress in moving beyond the issue, the larger brokers continue to be distracted, to their detriment.

Insurance commision is one important aspect, which is generally ignored by the client. He is not in the know of this aspect, wherin, the Insuring company gives more percentage of commision for initial premia and subsequently reduces the percentage for following years. The agent therefore does not do adequate follow up for continuing the policy without break or just ignores it as there is reduced income....

Contingent commissions, if not disclosed, can result in brokerage clients not knowing how much they are paying for the services they receive from their risk brokers. A commission should be viewed as just an alternative to fee-based consulting.  In theory the amount of commissions received should equal fees a client is willing to pay as commissions are built into insurance premiums.

Aon, CHUBB, WILLIS, Marsh and McLennan, Travelers (AOC, TRV, CB, MMC, WSH) Miss Contingency Fees Contingency FeesLosing $1,000,000,000+ of revenue is going to affect earnings and disrupt the status quo of doing business.  The article is a good summary of who has paid the largest fines, and is still constricted from business as usual.  The article does not provide information on some...

The controversy of contingent commissions is not a new one. This debate has caused significant changes to our views of broker payments, disclosure, ethics, and loyalty. The central question started off as being one about disclosure. Theoretically, if the client is aware then there isn't an issue. If this article is any indication, the debate is far from over. Aon, Marsh, Willis Group and Arthur J....