The national board of the Independent Insurance Agents & Brokers of America (IIABA) announced today it has adopted a new policy on producer compensation disclosure by carriers.
The policy seeks to avoid disparate and conflicting company requirements, and to encourage carriers to consult with IIABA, its state associations and independent agents before implementing any producer compensation disclosure.
The IIABA national board said it adopted the policy during its meeting in conjunction with the Big "I" Convention this month in New York City.
"Insurance agents, brokers and companies all must make independent decisions about whether and how to disclose the way they are compensated," IIABA CEO Robert A. Rusbuldt said in a statement. "We recognize this fact, and we acknowledge that everyone in the industry must take all necessary steps to comply with their legal obligations. But we also recognize that a wide range of divergent company requirements could create inefficiencies that would disrupt the way insurance agencies and brokerage firms do business, and that is what we hope to avoid."
With respect to any insurers that choose to make their own disclosures, the national board policy encourages them to have their disclosures notify insurance purchasers that:
? The insurance policy was placed by an independent insurance agent or broker, not an employee of the company.
? The company believes it is efficient and effective to distribute its policies through independent insurance agents and brokers.
? The agent or broker placing the policy with the company may receive commission for that placement.
? If applicable, the agent or broker may be eligible to receive additional incentives.
? Any questions about the nature of the compensation should be directed to the agent or broker.
IIABA president William G. Stiglitz III, an executive with Louisville, Ky.-based Hyland, Block & Hyland agency said that the policy makes it clear that "we fully encourage all carriers to fulfill their obligations under the law and to the public, and to do so in a way that respects the business needs of the independent agent and broker that sell their products."
He noted that, "We will continue to reach out to the companies and provide them with input as they make decisions about producer compensation disclosure. Working together on this issue will help the industry and the public."
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
