The Council of Insurance Agents & Brokers (CIAB) announced its endorsement of the National Association of Insurance Commissioners’ (NAIC) proposed regulation calling for the full disclosure and transparency of commercial insurance brokers’ compensation arrangements.
Below are excerpts from the CIAB letter send to NAIC this week. A full copy of CIAB’s letter to the NAIC is available at: www.ciab.com.
“There is nothing more important to America’s insurance agents and brokers than maintaining the trust of our clients and conducting our business operations with the utmost integrity,” said Ken Crerar, the president of CIAB.
“We applaud the NAIC for moving swiftly to provide a regulatory proposal to strengthen the disclosure of broker compensation arrangements, and we wholeheartedly agree with the approach that has been presented,” Crerar said. “American insurance agents and brokers believe the best way to guard against conflicts of interests or the appearance of such conflicts is through the full disclosure of all payment arrangements involving brokers, our clients and the carriers we work with.
“We do believe, however, that it is essential that new regulations governing the disclosure of broker compensation arrangements be made uniformly across the nation. To date, there has been a distinct lack of uniformity and coordination with respect to the inquiries sent by several states to insurers and brokers to elicit information about compensation arrangements.
“We are disappointed there has not been more of a move toward a uniform coordinated approach and urge states to continue to work together to develop and use a single inquiry form, and to limit their inquires to their domestic companies and resident producers. This would lighten the burden on both the industry and the regulators, who would be free to share information among themselves as necessary without additional inquiries to carriers and brokers.”