Nebraska: Insurers May Not Collect Fees for Health Insurance Consultants

Health insurance companies may not collect fees from a new insured on behalf of an insurance consultant if the insurance business is placed by an insurance consultant in Nebraska, according to the Nebraska Department of Insurance.

The Nebraska DOI said it has received multiple inquiries asking whether an insurer can collect and hold such fees for eventual disbursement to the consultant. The answer to this question is “no,” the department said.

An insurance consultant is obligated under state statuteÊto serve the interests of their client with objectivity and complete loyalty, according to the DOI. The fee for the insurance consultant’s services is between the insurance consultant and the client, and the fee must be specifically noted in the consultant contract or agreement.

Furthermore, it is against the law for any insurance consultant, or any agency or sales organization with which the consultant is connected, to receive any part of any commission or compensation paid by an insurer in connection with the sale or writing of any insurance that is within the subject matter of any consulting service performed prior to the sale of insurance, and for which such consultant has contracted to receive a fee.

Additionally, under Nebraska law a renewal of insurance is not considered a sale of insurance, the department noted.

If an insurer collects fees on behalf of the consultant, it would be construed as compensation paid by the insurer.

Topics Carriers