Maybe producers should also disclose what political parties they make donations to. While the “department” is at it they can disclose their salaries and who they get donations from. Hey, lets make the unions leaders disclose thier salaries, too! How is this information supposed to help the consumer? I LOVE NY!!!!
I think all of our insureds should be made to disclose how much money they make, from whence it comes, what products or services (other than insurance) that it is spent on,..
What did they get for Christmas? Their Birthday? Tips from their paper route or pizza delivery…
This is such nonsense. Do you get to ask ANYONE you buy a service from how much they are paid? It’s just another regulation that they can impose and than charge fines for. It’s a revenue builder for this completely misrun state.
Just sour grapes on your part.
If you don’t ask what your service providers are getting paid you are not looking after your own interests. I know what my atty gets paid, I know what my real estate agent gets paid, why shouldn’t I know what my insurance agent or broker gets paid. You guys check my credit rating and verify my income. You have brass to say your’s should be confidential.
Most Insurance Agents and Brokers attempt to characterize themselves as professionals, in the sense that they place their clients interests above their own with respect to a given service or transaction. Would you go to an Accountant or an Attorney who refused to disclose what they are paid for services provided on your behalf? Why should the fact that payment is indirectly received from the Insurer affect that right of the customer to know what a service is costing them? If you, as an Agent, want to hide fees generated from your customers don’t claim to be a professional. This practice of hiding fees ultimately paid by the insured can amount to FRAUD in many circumstnces-fees in lieu of commission arrangements.
No one has a problem disclosing our commission. In fact, my agency has been doing this voluntarily for some time. The problem is that if you read through the legislation, like I HAVE, it places a whole lot of requirements on the agent that if not followed can result in fines. We are already one of the most heavily regulated indistries in one of the most heavily regulated states. I can assure you that we don’t get paid anywhere near what your attorney gets paid and we probably work harder.
If you think insurance agents get paid too much then you haven’t ever worked in retail! We have all spent hours & days shopping accounts for the best deal for our insureds – not for our own pockets! You don’t want to know the markup on everyday items that we all buy! What’s good for the goose… If we have to announce our commission then every other business should have to do it, too!
Contrarian and An Insured – This is typical for our society, the many paying for the sins of the few. This makes no sense for the average small town broker or agent. The ultimate cost of an insurance policy does not change and cannot change by law. It is not like you can shop for insurance based on what the broker or agent makes. Totally absurd.
Then we should just accept that we have no control over how much we are charged? Like your auto repairman that worked on your car ends up with the equivanent of $120/hour based on actual hours worked, or your plumber that charges you the equivalent of $150/per hour for each actual hour under your sink. Do you feel those fees are reasonable for the work they perform? It’s only a matter of equity and disclosure. what are you afraid of???
You are either confused or just trying to take an approach to match your name. Insurance prices are decided by the company, not the agent. You can shop many things in life because prices change from one place to another (repair costs, lawyer or banking fees…etc)however as you well know a Travelers policy with identical coverages is the same at every agency in the state. If I make 50% of the premium and another agent makes 25% it doesn’t matter, the insured pays the same price for the policy. Climb down off of your high horse my friend and actually research something before you spout a useless opinion. In most circles it is considered bad taste to ask some one what they make is it not? Do you know what the mark up is on the furniture, autos or groceries that you buy? As a NY agent I can state that I will not disclose what I make to any one and will be the first to volunteer for the lawsuit that is coming according to IAANY.
The fact is that the agent doesn’t have any control over how much you are charged. Rates are set and approved by the same people that are proposing this legislation. It’s an agreement made between the insurance company and the Ins Dept. Our role is only to work with the carriers and find the best rate. Our commission is no where near what an attorney makes. We don’t have minimum hourly rates like auto mechanics do. And Further, the State of NY has in writing notified us that we are not considered on the same level as an attorney or other professionals however they really like to change the rules when they know that it will build revenue for them. I have no problem disclosing what I make on a policy. I have a problem with the government changing the rules to suit their budget problems.
To everyone, don’t worry. When OIG (Obama International Group) takes over the insurance industry this will all come to an end. Try getting any honest information about salaries then. On second thought no one will be making any income.
The SHOP may charge a fortune by the hour for an auto mechanic but the actual mechanic doesn’t get paid much at all. He is paid by the “book” time – how many hours the manufacturer says it will take to do the job. But it doesn’t include test drives, standing in line for parts, searching for the car in the lot, etc, etc, etc! Just like an agent’s commission doesn’t include all the time we spend before & after the sale!
It’s not sour grapes. You don’t know how much your attorney or accountant is paid. You know how much you are paying them (per hour, job, etc.), but you don’t know what they’re being paid. Out of the money you pay, the attorney/accountant pays for computers, software, services, etc. When you buy an insurance policy, you know what you’re paying – it’s called the premium, and the premium’s been approved by the state. What difference does it make how much the agent is being paid, and what business is it of your’s what the agent’s compensation is? If your agent is giving you the best value for the coverage requested, are you going to go somewhere else because you think he’s paid too much? You need to get real.
Regarding income and credit verification, that’s part of the underwriting process to procure the insurance you applied for. It’s your decision to purchase the insurance, and, in turn, have the required reports completed. So you think because you came to me for business I should divulge my personal finances?
You do know what you’re paying when you go to an insurance agent – it’s called the premium. Why do you need to know more, and what would you do with the information that would benefit you?
So you feel it is OK for you to know my finances but not for me to know yours. Full disclosure at all levels is in the best interest of everyone. Hiding and obscuring is nothing more than obfuscation to conceal from the buyer what the real costs are.
The “great” State of New York” is regulating itself to death. What a terrible State to do business in! I feel pity for all the agents who have to bend over to this crap. I hope the Insurance Department implodes from all the BS paperwork they require!
Want to post your W-2 here and on the wall of your office for all to see? This is AMERICA. We are FREE to work our butts off to earn a decent living and to not have to share this info with anyone (except the IRS!) if we choose. This whole topic is TOXIC and should demonstrate to ALL STATES’ insurance departments that this is a BAD IDEA!
Haven’t posted in awhile (usually just look for Compman comments) but this topic is interesting. On many accounts I would actually “enjoy” letting folks know how LITTLE I made. But generally, what no one calculates is the phone time, face time, that agents provide AFTER policy delivery. We don’t send out hourly bills for 10 minute conversations or continuing services like certs and mid-term consultation or personal visits. As to the NY politicos, let’em eat cake.
New York continues to shoot itself in the foot while the companies and jobs steadily move south. What are they thinking?
So do I have a right to know how much my box of cereal is marked up at the store, the cost vs price for menu items at restaurants, how about the incentives given to vets for shilling Science Diet, or how much doctors were incentivized to prescribe certain medicines? What about the news- do they get more $$ to show certian stories over others? What about the guy selling me that HDTV or mattress– I demand to know how much they’re shaving off the top.
To the NYS Dept. of Nonsense: How many Acorn offices are in NY and who insures them and what is their worker’s compensation payroll? I demand to know. How many Acorn employees are members of unions and how much is money is plowed into them by the democratic party? Keep it coming.
What about all the bonuses on Wall Street and disclosure? And disclosure on how they use our taxpayer bailout dollars? And does Wall Street need to disclose when investing?
Insureds are always complaining about how much they’re paying in premiums, even switching carriers to save $200 on a $4000 policy when their sales are in the seven-digit region. Do we get to ask them to show us how much they profit or how they spend it – to prove they CAN afford the $50 service fee, and to remain with the current carrier whose coverage is broader than that offered by the other broker (whose fee is greater, even premium on stripped-down version of coverage is slightly lower).
Transparency? I don’t steer business based on compensation, but based on quality. I can offer a $5000 policy on which I make $500, or a $6000 contract for which my commission is $450. I will sell the $6000 package if it is better for the insured.
A broker who sells the $5000 policy and tags on a $250 fee – hey, he’s still saving the client $750, right? – will not be transparent in his disclosure, just as he wasn’t about the coverage.
Disclosures don’t solve anything. A dishonest agent/broker will not be hindered by disclosures, but the requirement casts a pall on good agents industry-wide.
Not to mention it’s a waste of time, and for the environment-conscious amongst us, a waste of trees.
Contrarian – As an adviser your insurance agent/broker should not only know what you make but what you are worth so that they can provide you with options to protect all of your assets. One can only imagine that your middle name (or the role that you are playing)is “E & O claim.” Confirming prior posts we do not see your insurance score nor what makes it up only the companies do.
Yes, it is okay for me to know your finances if I am to do a proper job as your insurance agent. You are free to give or not give me that information. Without it, though, I cannot do my job. On the other hand, you knowing my finances does not affect your insurance coverage, nor should it affect your decision on buying the insurance.
Your accountant needs to know your finances to do his job. You don’t need to know his, and you don’t. You might know the fee charged, but that doesn’t tell you what he’s paid. With insurance, you know the premium. How that premium is distributed by the insurance company should not be a factor in your purchase.
The funny thing about Contrarian and others who whine about giving their financial information to an insurance agent don’t have any problem giving it to get a cell phone or cable TV.
Thanks guys and girls. Open and honest discussions are always desirable. However, it appears all of you are extremely sensative about this issue. People who are so defensive and who wish obscurity are always suspect.
Premium is premium, which you by now know – especially since you must be a shopper. If I charge a fee, you know that, too, because you will be signing the Section 2119 Broker Fee Agreement my office uses.
I suggest you walk in our shoes for a bit, try to make a living, feed your family, live by the rules we live by and then see how sensitive you are when some obscure government agency goes out of their way to make your life more difficult. I also suggest that you get a new insurance agent since it appears by your opinions that you A.) have no idea how insurance works and B.) don’t appear to like your agent enough to ask.
Apparently you are a proponent of the ridiculous. As far as obscurity you know what we do, what do you do, perhaps we could have a real dialogue? We already know that you are not in NY by the time stamp.
I hope the new legislation also reads in exceptionally large bold print that we are not allowed to rebate any of our earnings…. I cannot tell you how many wonderful prospects believe that we can!!!
Most prospects have mark ups of over 100%, yet they still believe that we should give back from our average 12% markup in order to do business with them..last time I looked, every bit of our earnings were taxable, we still offer our employees benefits in the form of health insurance & 401K’s, vacations, holidays & sick days… Why must we have to say exactly how much we make… if you want us to disclose extra earnings from a company I agree, but most of us work off of a straight commission..
I AM DISGUSTED!!! The Big Boys sin and we the brokers have to suffer!!
SoCal Indian Tribe’s CFO, Insurance Broker Charged
February 10, 2010
A Riverside County, Calif., grand jury has indicted two men for allegedly defrauding the Pechanga Band of Luiseno Indians out of more than $4 million.
The indictment, charges James Riley and Ryan Robinson with grand theft and bribery. Robinson is also charged with money laundering.
Prosecutors say Riley, an insurance broker, misrepresented the amount of insurance premiums for the tribe, overcharging them by $4 million in 2006-2007. Robinson, Pechanga’s former chief financial officer, allegedly received a kickback of more than $100,000 from Riley to look the other way. That money moved through multiple accounts before it was withdrawn in the form of cashier’s checks.
I own an agency and for every premium dollar sold we are paid approximately 13-cents commission. That’s it, 13-cents. Now why is that figure so important that I must now have a governing body requiring me to post it?
You still haven’t told us what your occupation is and how much money you make! There are “bad apples” in EVERY occupation. Intelligent people don’t dwell on the bad but look for the good & honest in everything. 33 years in the insurance business and I have never had a complaint. I’ve worked very hard to earn my reputation and my salary and yet I don’t make a fortune either!
You still haven’t told us what your occupation is and how much money you make! There are “bad apples” in EVERY occupation. Intelligent people don’t dwell on the bad but look for the good & honest in everything. 33 years in the insurance business and I have never had a complaint. I’ve worked very hard to earn my reputation and my salary and yet I don’t make a fortune either!
I agree with this idea to an extent. When handling multi-million dollar premiums and business deals agents should be required to disclose how the clients money is being disbursed. That’s a lotta dough being invested and insured’s should have a right to know where their money is going. There are opportunists out there that would take advantage. The client should be educated in how it works so they can spot a bad seed when it comes along.
However, there should be a limit. It would be a waste of an agent’s time and money (time=money, that’s a fact) to go through every-single-policy written and explain how they are paid. Agents shouldn’t be required to go into depth about their pay on a $5,000 or $6,000 premium. That’s ridiculous. Larger premiums and policies, maybe so.
I’m not an agent (I’m an adjuster) and have never been to NY. This kind of regulation is crazy so is responding to Contrarian. They obviously are a tool, ignore them and they will go away.
I’m interested in knowing what Contrarian would want to do with the information he (or she) obtains about the agent’s commission as the result of this regulation. What if you thought the commission was too much? Would you ask for another policy that paid less commission, but might be more expensive because the rates are higher, just so you could cut the agent’s commission? Would you be looking for a rebate (illegal) or that we lower the premium and reduce our commission (the premium rates and commissions are filed with the Ins. Dept. which would have to pre-approve any change) So, of what use, other than curiosity or noseiness, is that information to you? Oh, I see, it’s that magic word, “transparency”. If that’s what this is about for you, just ask, don’t make us deal with the tasks required by regulations. If some agent doesn’t want to divulge their commission when asked, go somethwere else. No one is forcing you to do business with anyone. This whole regulation fails to recognize that simple fact: – if someone isn’t satisfied, they can go somewhere else – no one is forced to do busi8ness with anyone. But, like one of the respondents indicated, for the State, it’s all about another source of revenue out of our hides. In my 47 years of agency experience (and as I have heard from many of my colleagues) no one has ever asked me what I am paid, so, it is obvious there is no public clamor for this information. Rather, this regulation is purely the result of complaints from those large brokerages that agreed to disclose as part of their settlements with the State for their misdeeds who now feel they are at a competitive disadvantage having to disclouse theri compensation, and, VOILA!, the State finds another revenue source.
If my client want to know what I earn it should be up to me if I want to tell him.
It should be up to him if he wants to do business with me.
BTW I tell most of my clients what I make especially the little ones…some people have know idea how little revenue they generate….I have a feeling most of the people clamoring for data on the board fall into this group
it’s funny, because how many of our policy holders actually have read their own policy? it truly makes me wonder why should the gov’t get involved. if they want to be involved, then we as a taxpayer have a right to be involved in the oversight of these bailouts. see what money transpired and not just the senate cmte. besides, how much money does the senate spend on all of these trivial cmte mtgs?
on average, agencies receive 5-15% commission on a policy. Workmen’s Comp pays ~5-8%, auto ~10%, home ~10%, GL and surplus lines ~10%-15%.
Here in south eastern NC for a basic, no-frills auto liability policy, it runs around $220 (+/- a bit depending on where you live). 10% of that amount is $22.00.
Assuming I can write this policy in 1-hr or less, I’ve just made $22/hr for this policy for the next six months. If this policy requires any servicing at all, that factor goes down. If i have to spend 4 hrs of work on this policy over that period of time, I’ve just made $5.50/hr on this policy… aka less then minimum wage.
Workmens comp.. 850 minimum premium as of current(if it’s only a ghost policy). Assuming 5% commission (standard rate if done via the NCRB assigned risk plan), That’s $42.50 for the year… less then a personal auto policy. And workmen’s comp policies require a LOT of maintence. COIs, chasing down the insured for audits, etc.
Yup yup, we agents be raking in the money, yup yup.
Granted premium rates are higher in NY but unless you’re writing the multi-thousand/million dollar policies, most of us aren’t earning alot per policy. We depend on volume. And when you start to factor in servicing time, and time wasted explaining what you get paid/filing the paperwork showing that you’ve explained things, you’re costing yourself money.
Caffeinated, in my area of New York State the commissions are similar to what you experience, we are far from the thousands in premium values. The average for a personal lines policy is closer to $500.00 annually.
When I inform our clients that we are paid 15 or 10-percent of that premium they ask me how I can possibly pay for the lights! Up here a Producer would starve if not paid a salary to compensate for the diminishing commissions. This legislation is beyond absurd; all it amounts to is additional expense on my part.
An interesting extract from an article reflecting RIMS perspective on this matter. Guess thare are two sides to this argument……
“He continued that the intent of the rule, as it was initially presented, was to bring “greater clarity and certainty to the insurance purchase transaction in order to protect consumers. While this objective was a positive first step by the department; each subsequent revision has diluted the original intent and has resulted in the final rule that falls short of complete and mandatory disclosure, for which RIMS has been a long-time advocate.”
Submission Acknowledgemnt Forms. We have had a process in house for many years that already complies with the new rules. We require ALL applicants, new and renewal, to sign a submission acknowldegement that we are an agent/Broker, that we will submit to multiple markets on their behalf, that we cannot guarantee placement and that we are paid a commission ranging from X to Y etc. When we first started doing it 4 years ago, it was a pain, but its just part of the application process . We dont event think about it anymore .
MIke Smith
Axis Insurance Services LLC http://www.axisins.com
Maybe producers should also disclose what political parties they make donations to. While the “department” is at it they can disclose their salaries and who they get donations from. Hey, lets make the unions leaders disclose thier salaries, too! How is this information supposed to help the consumer? I LOVE NY!!!!
I agree. Gotta love NY. Thank you Spitzer.
Yet another obstacle for those trying to make a living in this state.
I think all of our insureds should be made to disclose how much money they make, from whence it comes, what products or services (other than insurance) that it is spent on,..
What did they get for Christmas? Their Birthday? Tips from their paper route or pizza delivery…
This is such nonsense. Do you get to ask ANYONE you buy a service from how much they are paid? It’s just another regulation that they can impose and than charge fines for. It’s a revenue builder for this completely misrun state.
Just sour grapes on your part.
If you don’t ask what your service providers are getting paid you are not looking after your own interests. I know what my atty gets paid, I know what my real estate agent gets paid, why shouldn’t I know what my insurance agent or broker gets paid. You guys check my credit rating and verify my income. You have brass to say your’s should be confidential.
Most Insurance Agents and Brokers attempt to characterize themselves as professionals, in the sense that they place their clients interests above their own with respect to a given service or transaction. Would you go to an Accountant or an Attorney who refused to disclose what they are paid for services provided on your behalf? Why should the fact that payment is indirectly received from the Insurer affect that right of the customer to know what a service is costing them? If you, as an Agent, want to hide fees generated from your customers don’t claim to be a professional. This practice of hiding fees ultimately paid by the insured can amount to FRAUD in many circumstnces-fees in lieu of commission arrangements.
No one has a problem disclosing our commission. In fact, my agency has been doing this voluntarily for some time. The problem is that if you read through the legislation, like I HAVE, it places a whole lot of requirements on the agent that if not followed can result in fines. We are already one of the most heavily regulated indistries in one of the most heavily regulated states. I can assure you that we don’t get paid anywhere near what your attorney gets paid and we probably work harder.
What i make is nobody’s business.
What Companies require from Insureds with regard to their income is beyond my control
If you think insurance agents get paid too much then you haven’t ever worked in retail! We have all spent hours & days shopping accounts for the best deal for our insureds – not for our own pockets! You don’t want to know the markup on everyday items that we all buy! What’s good for the goose… If we have to announce our commission then every other business should have to do it, too!
Contrarian and An Insured – This is typical for our society, the many paying for the sins of the few. This makes no sense for the average small town broker or agent. The ultimate cost of an insurance policy does not change and cannot change by law. It is not like you can shop for insurance based on what the broker or agent makes. Totally absurd.
To insanity, et al…
Then we should just accept that we have no control over how much we are charged? Like your auto repairman that worked on your car ends up with the equivanent of $120/hour based on actual hours worked, or your plumber that charges you the equivalent of $150/per hour for each actual hour under your sink. Do you feel those fees are reasonable for the work they perform? It’s only a matter of equity and disclosure. what are you afraid of???
You are either confused or just trying to take an approach to match your name. Insurance prices are decided by the company, not the agent. You can shop many things in life because prices change from one place to another (repair costs, lawyer or banking fees…etc)however as you well know a Travelers policy with identical coverages is the same at every agency in the state. If I make 50% of the premium and another agent makes 25% it doesn’t matter, the insured pays the same price for the policy. Climb down off of your high horse my friend and actually research something before you spout a useless opinion. In most circles it is considered bad taste to ask some one what they make is it not? Do you know what the mark up is on the furniture, autos or groceries that you buy? As a NY agent I can state that I will not disclose what I make to any one and will be the first to volunteer for the lawsuit that is coming according to IAANY.
The fact is that the agent doesn’t have any control over how much you are charged. Rates are set and approved by the same people that are proposing this legislation. It’s an agreement made between the insurance company and the Ins Dept. Our role is only to work with the carriers and find the best rate. Our commission is no where near what an attorney makes. We don’t have minimum hourly rates like auto mechanics do. And Further, the State of NY has in writing notified us that we are not considered on the same level as an attorney or other professionals however they really like to change the rules when they know that it will build revenue for them. I have no problem disclosing what I make on a policy. I have a problem with the government changing the rules to suit their budget problems.
To everyone, don’t worry. When OIG (Obama International Group) takes over the insurance industry this will all come to an end. Try getting any honest information about salaries then. On second thought no one will be making any income.
The SHOP may charge a fortune by the hour for an auto mechanic but the actual mechanic doesn’t get paid much at all. He is paid by the “book” time – how many hours the manufacturer says it will take to do the job. But it doesn’t include test drives, standing in line for parts, searching for the car in the lot, etc, etc, etc! Just like an agent’s commission doesn’t include all the time we spend before & after the sale!
It’s not sour grapes. You don’t know how much your attorney or accountant is paid. You know how much you are paying them (per hour, job, etc.), but you don’t know what they’re being paid. Out of the money you pay, the attorney/accountant pays for computers, software, services, etc. When you buy an insurance policy, you know what you’re paying – it’s called the premium, and the premium’s been approved by the state. What difference does it make how much the agent is being paid, and what business is it of your’s what the agent’s compensation is? If your agent is giving you the best value for the coverage requested, are you going to go somewhere else because you think he’s paid too much? You need to get real.
Regarding income and credit verification, that’s part of the underwriting process to procure the insurance you applied for. It’s your decision to purchase the insurance, and, in turn, have the required reports completed. So you think because you came to me for business I should divulge my personal finances?
You do know what you’re paying when you go to an insurance agent – it’s called the premium. Why do you need to know more, and what would you do with the information that would benefit you?
To Kevin L.
So you feel it is OK for you to know my finances but not for me to know yours. Full disclosure at all levels is in the best interest of everyone. Hiding and obscuring is nothing more than obfuscation to conceal from the buyer what the real costs are.
The “great” State of New York” is regulating itself to death. What a terrible State to do business in! I feel pity for all the agents who have to bend over to this crap. I hope the Insurance Department implodes from all the BS paperwork they require!
Want to post your W-2 here and on the wall of your office for all to see? This is AMERICA. We are FREE to work our butts off to earn a decent living and to not have to share this info with anyone (except the IRS!) if we choose. This whole topic is TOXIC and should demonstrate to ALL STATES’ insurance departments that this is a BAD IDEA!
Haven’t posted in awhile (usually just look for Compman comments) but this topic is interesting. On many accounts I would actually “enjoy” letting folks know how LITTLE I made. But generally, what no one calculates is the phone time, face time, that agents provide AFTER policy delivery. We don’t send out hourly bills for 10 minute conversations or continuing services like certs and mid-term consultation or personal visits. As to the NY politicos, let’em eat cake.
New York continues to shoot itself in the foot while the companies and jobs steadily move south. What are they thinking?
So do I have a right to know how much my box of cereal is marked up at the store, the cost vs price for menu items at restaurants, how about the incentives given to vets for shilling Science Diet, or how much doctors were incentivized to prescribe certain medicines? What about the news- do they get more $$ to show certian stories over others? What about the guy selling me that HDTV or mattress– I demand to know how much they’re shaving off the top.
To the NYS Dept. of Nonsense: How many Acorn offices are in NY and who insures them and what is their worker’s compensation payroll? I demand to know. How many Acorn employees are members of unions and how much is money is plowed into them by the democratic party? Keep it coming.
What about all the bonuses on Wall Street and disclosure? And disclosure on how they use our taxpayer bailout dollars? And does Wall Street need to disclose when investing?
Insureds are always complaining about how much they’re paying in premiums, even switching carriers to save $200 on a $4000 policy when their sales are in the seven-digit region. Do we get to ask them to show us how much they profit or how they spend it – to prove they CAN afford the $50 service fee, and to remain with the current carrier whose coverage is broader than that offered by the other broker (whose fee is greater, even premium on stripped-down version of coverage is slightly lower).
Transparency? I don’t steer business based on compensation, but based on quality. I can offer a $5000 policy on which I make $500, or a $6000 contract for which my commission is $450. I will sell the $6000 package if it is better for the insured.
A broker who sells the $5000 policy and tags on a $250 fee – hey, he’s still saving the client $750, right? – will not be transparent in his disclosure, just as he wasn’t about the coverage.
Disclosures don’t solve anything. A dishonest agent/broker will not be hindered by disclosures, but the requirement casts a pall on good agents industry-wide.
Not to mention it’s a waste of time, and for the environment-conscious amongst us, a waste of trees.
Contrarian – As an adviser your insurance agent/broker should not only know what you make but what you are worth so that they can provide you with options to protect all of your assets. One can only imagine that your middle name (or the role that you are playing)is “E & O claim.” Confirming prior posts we do not see your insurance score nor what makes it up only the companies do.
To Rural Broker,
Save your breath, Contratian isn’t listening. I’d like to see if their opinion would change if the roles were reversed.
Yes, it is okay for me to know your finances if I am to do a proper job as your insurance agent. You are free to give or not give me that information. Without it, though, I cannot do my job. On the other hand, you knowing my finances does not affect your insurance coverage, nor should it affect your decision on buying the insurance.
Your accountant needs to know your finances to do his job. You don’t need to know his, and you don’t. You might know the fee charged, but that doesn’t tell you what he’s paid. With insurance, you know the premium. How that premium is distributed by the insurance company should not be a factor in your purchase.
The funny thing about Contrarian and others who whine about giving their financial information to an insurance agent don’t have any problem giving it to get a cell phone or cable TV.
Thanks guys and girls. Open and honest discussions are always desirable. However, it appears all of you are extremely sensative about this issue. People who are so defensive and who wish obscurity are always suspect.
….
Contrarian, conshmarian.
Who asks you for your income?
Premium is premium, which you by now know – especially since you must be a shopper. If I charge a fee, you know that, too, because you will be signing the Section 2119 Broker Fee Agreement my office uses.
Contrarian,
I suggest you walk in our shoes for a bit, try to make a living, feed your family, live by the rules we live by and then see how sensitive you are when some obscure government agency goes out of their way to make your life more difficult. I also suggest that you get a new insurance agent since it appears by your opinions that you A.) have no idea how insurance works and B.) don’t appear to like your agent enough to ask.
First agents will not offer coverage to any client who does not generate enough income to cover the agency’s expenses including regulatory expenses.
Second agents will avoid providing clients with better premium deals since that will trigger disclosure requirements.
Why is this regulation good for society?
Apparently you are a proponent of the ridiculous. As far as obscurity you know what we do, what do you do, perhaps we could have a real dialogue? We already know that you are not in NY by the time stamp.
I hope the new legislation also reads in exceptionally large bold print that we are not allowed to rebate any of our earnings…. I cannot tell you how many wonderful prospects believe that we can!!!
Most prospects have mark ups of over 100%, yet they still believe that we should give back from our average 12% markup in order to do business with them..last time I looked, every bit of our earnings were taxable, we still offer our employees benefits in the form of health insurance & 401K’s, vacations, holidays & sick days… Why must we have to say exactly how much we make… if you want us to disclose extra earnings from a company I agree, but most of us work off of a straight commission..
I AM DISGUSTED!!! The Big Boys sin and we the brokers have to suffer!!
Think what you want…..
SoCal Indian Tribe’s CFO, Insurance Broker Charged
February 10, 2010
A Riverside County, Calif., grand jury has indicted two men for allegedly defrauding the Pechanga Band of Luiseno Indians out of more than $4 million.
The indictment, charges James Riley and Ryan Robinson with grand theft and bribery. Robinson is also charged with money laundering.
Prosecutors say Riley, an insurance broker, misrepresented the amount of insurance premiums for the tribe, overcharging them by $4 million in 2006-2007. Robinson, Pechanga’s former chief financial officer, allegedly received a kickback of more than $100,000 from Riley to look the other way. That money moved through multiple accounts before it was withdrawn in the form of cashier’s checks.
Weak and not applicable to the issue at hand.
I own an agency and for every premium dollar sold we are paid approximately 13-cents commission. That’s it, 13-cents. Now why is that figure so important that I must now have a governing body requiring me to post it?
You still haven’t told us what your occupation is and how much money you make! There are “bad apples” in EVERY occupation. Intelligent people don’t dwell on the bad but look for the good & honest in everything. 33 years in the insurance business and I have never had a complaint. I’ve worked very hard to earn my reputation and my salary and yet I don’t make a fortune either!
You still haven’t told us what your occupation is and how much money you make! There are “bad apples” in EVERY occupation. Intelligent people don’t dwell on the bad but look for the good & honest in everything. 33 years in the insurance business and I have never had a complaint. I’ve worked very hard to earn my reputation and my salary and yet I don’t make a fortune either!
Killing…what you know about killing?
I agree with this idea to an extent. When handling multi-million dollar premiums and business deals agents should be required to disclose how the clients money is being disbursed. That’s a lotta dough being invested and insured’s should have a right to know where their money is going. There are opportunists out there that would take advantage. The client should be educated in how it works so they can spot a bad seed when it comes along.
However, there should be a limit. It would be a waste of an agent’s time and money (time=money, that’s a fact) to go through every-single-policy written and explain how they are paid. Agents shouldn’t be required to go into depth about their pay on a $5,000 or $6,000 premium. That’s ridiculous. Larger premiums and policies, maybe so.
I’m not an agent (I’m an adjuster) and have never been to NY. This kind of regulation is crazy so is responding to Contrarian. They obviously are a tool, ignore them and they will go away.
I’m interested in knowing what Contrarian would want to do with the information he (or she) obtains about the agent’s commission as the result of this regulation. What if you thought the commission was too much? Would you ask for another policy that paid less commission, but might be more expensive because the rates are higher, just so you could cut the agent’s commission? Would you be looking for a rebate (illegal) or that we lower the premium and reduce our commission (the premium rates and commissions are filed with the Ins. Dept. which would have to pre-approve any change) So, of what use, other than curiosity or noseiness, is that information to you? Oh, I see, it’s that magic word, “transparency”. If that’s what this is about for you, just ask, don’t make us deal with the tasks required by regulations. If some agent doesn’t want to divulge their commission when asked, go somethwere else. No one is forcing you to do business with anyone. This whole regulation fails to recognize that simple fact: – if someone isn’t satisfied, they can go somewhere else – no one is forced to do busi8ness with anyone. But, like one of the respondents indicated, for the State, it’s all about another source of revenue out of our hides. In my 47 years of agency experience (and as I have heard from many of my colleagues) no one has ever asked me what I am paid, so, it is obvious there is no public clamor for this information. Rather, this regulation is purely the result of complaints from those large brokerages that agreed to disclose as part of their settlements with the State for their misdeeds who now feel they are at a competitive disadvantage having to disclouse theri compensation, and, VOILA!, the State finds another revenue source.
Maybe I would rather do business with insurance companies that properly compensate their brokers and agents rather than ones who nickel and dime them.
Crazy Idea
keep the government out of it
If my client want to know what I earn it should be up to me if I want to tell him.
It should be up to him if he wants to do business with me.
BTW I tell most of my clients what I make especially the little ones…some people have know idea how little revenue they generate….I have a feeling most of the people clamoring for data on the board fall into this group
it’s funny, because how many of our policy holders actually have read their own policy? it truly makes me wonder why should the gov’t get involved. if they want to be involved, then we as a taxpayer have a right to be involved in the oversight of these bailouts. see what money transpired and not just the senate cmte. besides, how much money does the senate spend on all of these trivial cmte mtgs?
on average, agencies receive 5-15% commission on a policy. Workmen’s Comp pays ~5-8%, auto ~10%, home ~10%, GL and surplus lines ~10%-15%.
Here in south eastern NC for a basic, no-frills auto liability policy, it runs around $220 (+/- a bit depending on where you live). 10% of that amount is $22.00.
Assuming I can write this policy in 1-hr or less, I’ve just made $22/hr for this policy for the next six months. If this policy requires any servicing at all, that factor goes down. If i have to spend 4 hrs of work on this policy over that period of time, I’ve just made $5.50/hr on this policy… aka less then minimum wage.
Workmens comp.. 850 minimum premium as of current(if it’s only a ghost policy). Assuming 5% commission (standard rate if done via the NCRB assigned risk plan), That’s $42.50 for the year… less then a personal auto policy. And workmen’s comp policies require a LOT of maintence. COIs, chasing down the insured for audits, etc.
Yup yup, we agents be raking in the money, yup yup.
Granted premium rates are higher in NY but unless you’re writing the multi-thousand/million dollar policies, most of us aren’t earning alot per policy. We depend on volume. And when you start to factor in servicing time, and time wasted explaining what you get paid/filing the paperwork showing that you’ve explained things, you’re costing yourself money.
Caffeinated, in my area of New York State the commissions are similar to what you experience, we are far from the thousands in premium values. The average for a personal lines policy is closer to $500.00 annually.
When I inform our clients that we are paid 15 or 10-percent of that premium they ask me how I can possibly pay for the lights! Up here a Producer would starve if not paid a salary to compensate for the diminishing commissions. This legislation is beyond absurd; all it amounts to is additional expense on my part.
An interesting extract from an article reflecting RIMS perspective on this matter. Guess thare are two sides to this argument……
“He continued that the intent of the rule, as it was initially presented, was to bring “greater clarity and certainty to the insurance purchase transaction in order to protect consumers. While this objective was a positive first step by the department; each subsequent revision has diluted the original intent and has resulted in the final rule that falls short of complete and mandatory disclosure, for which RIMS has been a long-time advocate.”
Submission Acknowledgemnt Forms. We have had a process in house for many years that already complies with the new rules. We require ALL applicants, new and renewal, to sign a submission acknowldegement that we are an agent/Broker, that we will submit to multiple markets on their behalf, that we cannot guarantee placement and that we are paid a commission ranging from X to Y etc. When we first started doing it 4 years ago, it was a pain, but its just part of the application process . We dont event think about it anymore .
MIke Smith
Axis Insurance Services LLC
http://www.axisins.com