Someone from Aon states: “We believe that all brokers and agents should, at a minimum, be willing to tell their clients who will pay them, how much they’ll make and the quotes insurers provide. This is the basic information every client deserves.”
If this is the case, shouldn’t we be able to ask our Doctors how much profit do they make? The grocer, what is his cost of goods?
Why stop with insurance? Why shouldn’t my surgeon have to tell me what his compensation will be when he is pushing to do open heart surgery on me; why shouldn’t a guy pushing a certain brand of snowthrower have to tell me what he will earn and if he is receiving an incentive to sell that particular brand; why shouldn’t the car dealer have to tell me exactly what he will get from this sale and what incentives and profit sharing he is offered by the manufacturers; how about the store pushing a certain brand of mattress — is that store getting an incentive from the manufacturer? and on and on. The big guys are the ones that made “profit sharing” and “contingent commissions” seemingly dirty words, and now we little folks will have to pay the price.
Please tell me where the client abuses have been for retail customers of Independent Agents. Unlike the Aon’s, Marsh & Willis whose sophisticated buyer is paying plenty to get their disclosure statement detailing the fees being made. Your average personal lines client does not understand the support staff expenses a Main Street agent has in running an office. The client should only be interested in the coverage and bottom line price. Why Direct Writers are excluded from detailing all their expenses is troubling. What purpose does it serve to disclose commissions when coverage is generally the same. Where has the abuse of Insureds occurred? This is just more work , increases customer confusion and allows the direct writers to gain greater market share by claiming they make less than Independent Agents so they can “be perceived as “more honest”. I would question the accuracy of the idea the NY Insurance Dept has relative to “steering business to maximize earning potential”. What does the direct writer say to his client so he can make the sale for only the contract to one company is offering? Get real and give me a break!
This is plain beaurecrat nonesense. I would like to see what sales people for appliance, auto’s, furniture, computer, software systems etc etc earn. How about the clerks at the stores where we shop; how much do they earn an hour? This list of people from whom we purchase items could go on indefinitely so I will save the boredom. The consumer is king. If they do not like the price, they can shop. Now consumers witll learn to shop based on agents commission!
Independent Insurance Agents don’t sell based on commission; they provide the best coverage at the best price to the consumer in order to retain the business. This will do no more than cause a lot of extra expense and a ton of conufustion to the consumer and will leave agents having to explain what they do with “all” that commission that they earn!! Typical government intrustion into the free enterprise system!!!!!!!!
Did you notice that CAPTIVE AGENTS are excluded from the disclosure requirements. This is completely unfair and incomprehensible. Why are independent agents being singled out? It completely goes against free market ideals. Independent agents offer customers professional consultation, customization and choice as opposed to a Captive agents one company offering and an agent whose first allegiance is to the Captive Company, his employer, not the customer.
I dont know why everyone is so shocked by this. The bleeding hart liberals hate the free market b/c it rewards hard work and punishes slacking off. As for captives and direct writers being expempt im not shocked. They hate that us independants can serve our clients better than they have ever dreamed of. They have the big names and money to keep thems selves out of it. My fellow main street agents this IS an attack on us by the commies (also known as liberals), the captives, the direct writers, and the large brokerage firms who’s corruption is the reason this all started. Why should the large firms who srcrewed this up be punished alone, no no no make us all suffer for what they did, thats the new obama/pelosi America.
Nation regulation you say? The federal government screws up everthing it touches, social security, fredie & fannie, the SEC (maddoff & AIG) and the list goes on and on. Yah thats just what this industry needs, please im gonna be ill.
Our customers already know that we get a commission on their premiums, just like they know real estate agents make commissions and doctors make profits. Why regulate us, we are professionals just like lawyers and accountants. This is unfair, regulate everyone or no one. The consumer is already aware. Most of us do not charge for our professional advise, we earn our living on commissions.
As I read through some of these comments, there are several things that stand out.
First, the “claim” that insurance people are “professionals”, just like lawyers and accountants. Really? did you spend some four to six plus years in college, and then take the time to study for a rigorous exam to qualify for your profession?
Second, as to the exclusion of captive agents – how many captive agents have large commercial accounts that include the need for multiple layers of coverage (Property or Excess), providing additional services such as claims handling analysis, expansion of safety programs and such? Also, how many captive agents charge a flat fee, versus commissions?
I currently work for a large healthcare facility (hospital) with multiple locations in the same area. While we pay our broker a decent fee (somewhere’s between a low and mid six figure range), there are oft times we question whether they’re worth it.
A large commercial client should know exactly how much their broker is being paid (thru fees, commissions or a combination of both) so that they can better judge whether they’re getting their money’s worth.
two comments; first, Differenet is certainly different. I wonder if different discloses his/her income.
Second, we all agree that LARGE COMMERCIAL ACCOUNTS should have commissions, fees etc disclosed – what I do not agree with is a broad brush which is a typical beaurecratic process!
The people I work for know what I make. I am a professional. Lawyers and accountants are also professionals. Their clients pay them directly, so their clients know what they make.
You can’t claim to be both a professional and a salesperson. Buying insurance is not like buying a microwave oven. Most (PL) consumers know they need insurance but do not have a clue what kind or how much. They rely on their agent for substantial guidance, hence the E&O exposure (microwave oven salepeople do not have E&O exposure). Professionals are also required, via a code of conduct and often regulations, to disclose potential conflicts of interest – such as compensation by anyone whose interests may directly conflict with those of the client.
This is the same murky in-between world that real estate agents/brokers occupy.
Many agents have a generic disclosure statement that states they recieve commissions and may be entitled to some profit sharing. It appears as letter to be signed by the client, and often invites a client to ask if they have more specific questions. While I agree with many of the posters, any interference by the NYSID into compensation is wrong, it seems like a very generic disclosure statement is a much more reasonable standard than what’s in the draft regulation.
Someone from Aon states: “We believe that all brokers and agents should, at a minimum, be willing to tell their clients who will pay them, how much they’ll make and the quotes insurers provide. This is the basic information every client deserves.”
If this is the case, shouldn’t we be able to ask our Doctors how much profit do they make? The grocer, what is his cost of goods?
Get real.
Why stop with insurance? Why shouldn’t my surgeon have to tell me what his compensation will be when he is pushing to do open heart surgery on me; why shouldn’t a guy pushing a certain brand of snowthrower have to tell me what he will earn and if he is receiving an incentive to sell that particular brand; why shouldn’t the car dealer have to tell me exactly what he will get from this sale and what incentives and profit sharing he is offered by the manufacturers; how about the store pushing a certain brand of mattress — is that store getting an incentive from the manufacturer? and on and on. The big guys are the ones that made “profit sharing” and “contingent commissions” seemingly dirty words, and now we little folks will have to pay the price.
Please tell me where the client abuses have been for retail customers of Independent Agents. Unlike the Aon’s, Marsh & Willis whose sophisticated buyer is paying plenty to get their disclosure statement detailing the fees being made. Your average personal lines client does not understand the support staff expenses a Main Street agent has in running an office. The client should only be interested in the coverage and bottom line price. Why Direct Writers are excluded from detailing all their expenses is troubling. What purpose does it serve to disclose commissions when coverage is generally the same. Where has the abuse of Insureds occurred? This is just more work , increases customer confusion and allows the direct writers to gain greater market share by claiming they make less than Independent Agents so they can “be perceived as “more honest”. I would question the accuracy of the idea the NY Insurance Dept has relative to “steering business to maximize earning potential”. What does the direct writer say to his client so he can make the sale for only the contract to one company is offering? Get real and give me a break!
This is another reason for National Regulation
Do we need NY setting the disclosure statement for the nation and our state.
if NY state wants to make this a law in their state then so be it.
At least national regulation will allow for national impute.
This is plain beaurecrat nonesense. I would like to see what sales people for appliance, auto’s, furniture, computer, software systems etc etc earn. How about the clerks at the stores where we shop; how much do they earn an hour? This list of people from whom we purchase items could go on indefinitely so I will save the boredom. The consumer is king. If they do not like the price, they can shop. Now consumers witll learn to shop based on agents commission!
Independent Insurance Agents don’t sell based on commission; they provide the best coverage at the best price to the consumer in order to retain the business. This will do no more than cause a lot of extra expense and a ton of conufustion to the consumer and will leave agents having to explain what they do with “all” that commission that they earn!! Typical government intrustion into the free enterprise system!!!!!!!!
Did you notice that CAPTIVE AGENTS are excluded from the disclosure requirements. This is completely unfair and incomprehensible. Why are independent agents being singled out? It completely goes against free market ideals. Independent agents offer customers professional consultation, customization and choice as opposed to a Captive agents one company offering and an agent whose first allegiance is to the Captive Company, his employer, not the customer.
I dont know why everyone is so shocked by this. The bleeding hart liberals hate the free market b/c it rewards hard work and punishes slacking off. As for captives and direct writers being expempt im not shocked. They hate that us independants can serve our clients better than they have ever dreamed of. They have the big names and money to keep thems selves out of it. My fellow main street agents this IS an attack on us by the commies (also known as liberals), the captives, the direct writers, and the large brokerage firms who’s corruption is the reason this all started. Why should the large firms who srcrewed this up be punished alone, no no no make us all suffer for what they did, thats the new obama/pelosi America.
Nation regulation you say? The federal government screws up everthing it touches, social security, fredie & fannie, the SEC (maddoff & AIG) and the list goes on and on. Yah thats just what this industry needs, please im gonna be ill.
Our customers already know that we get a commission on their premiums, just like they know real estate agents make commissions and doctors make profits. Why regulate us, we are professionals just like lawyers and accountants. This is unfair, regulate everyone or no one. The consumer is already aware. Most of us do not charge for our professional advise, we earn our living on commissions.
Wait a minute, you mean to tell me you guys don’t currently disclose commission amounts or percentages to the policyholder?
As I read through some of these comments, there are several things that stand out.
First, the “claim” that insurance people are “professionals”, just like lawyers and accountants. Really? did you spend some four to six plus years in college, and then take the time to study for a rigorous exam to qualify for your profession?
Second, as to the exclusion of captive agents – how many captive agents have large commercial accounts that include the need for multiple layers of coverage (Property or Excess), providing additional services such as claims handling analysis, expansion of safety programs and such? Also, how many captive agents charge a flat fee, versus commissions?
I currently work for a large healthcare facility (hospital) with multiple locations in the same area. While we pay our broker a decent fee (somewhere’s between a low and mid six figure range), there are oft times we question whether they’re worth it.
A large commercial client should know exactly how much their broker is being paid (thru fees, commissions or a combination of both) so that they can better judge whether they’re getting their money’s worth.
two comments; first, Differenet is certainly different. I wonder if different discloses his/her income.
Second, we all agree that LARGE COMMERCIAL ACCOUNTS should have commissions, fees etc disclosed – what I do not agree with is a broad brush which is a typical beaurecratic process!
The people I work for know what I make. I am a professional. Lawyers and accountants are also professionals. Their clients pay them directly, so their clients know what they make.
You can’t claim to be both a professional and a salesperson. Buying insurance is not like buying a microwave oven. Most (PL) consumers know they need insurance but do not have a clue what kind or how much. They rely on their agent for substantial guidance, hence the E&O exposure (microwave oven salepeople do not have E&O exposure). Professionals are also required, via a code of conduct and often regulations, to disclose potential conflicts of interest – such as compensation by anyone whose interests may directly conflict with those of the client.
This is the same murky in-between world that real estate agents/brokers occupy.
Many agents have a generic disclosure statement that states they recieve commissions and may be entitled to some profit sharing. It appears as letter to be signed by the client, and often invites a client to ask if they have more specific questions. While I agree with many of the posters, any interference by the NYSID into compensation is wrong, it seems like a very generic disclosure statement is a much more reasonable standard than what’s in the draft regulation.