I find this most recent position self serving.
If quality of business placed with a carrier is meaningless then you will see that reflected in increased pricing.
Are risk managers so dumb that they can be \”duped\” by a broker into taking an inferior or over priced product? I don\’t think so! Personally, I don\’t care for the contingent commission approach. I would prefer a higher \”normal\” commission, but, since when is a incentive based compensation program evil? I can\’t think of an industry that doesn\’t use incentive compensation with its sales force.
The part that troubles me is \”Failure to disclose such arrangements runs counter to the spirit of partnership that risk managers seek to achieve with their brokers, vendors, and insurers.\”
Partnerships? OMG, you may have to get outside of your comfort zone and contact another broker? Heaven forbid. Bottom line…if you don\’t trust your current vendor to get you the most competitive price for the most comprehensive coverage, then it\’s time to switch vendors.
I am a small, main-street independent agent and I disagree with the notion that contingencies cause a conflict of interest. The contingencies make sure I don\’t start placing marginal business (read: overly susceptible to loss) in preferred companies. I don\’t have the ability, due to competition, to \”bid rig\” or steer business. Many of my competitors have the same companies as I and the companies give everyone the same quote.
I do not deal with risk managers because the companies I insure are smaller.
While I agree that the bid-rigging/steering scandal that happened is unethical and greedy, I lay much of the blame on the highly paid, highly educated risk managers that allowed them to get away with it simply because they were too lazy/busy to contact another broker/company for alternative quotes. This is what your being paid for RIMS members…if you don\’t understand the insurance business, then you can\’t do your job effectively.
(Doc\’s Poetry Corner Wrap-Around) town of Los Gatos Community Hospital, Los Gatos, CA.
Patient Debbie, Debra, Deborah recites a poem about how she is a teapot after an auto-mis-hap, (Insurer-State Farm) but is making progress according to her psychiatrist. She thought she was a toaster oven the week before.
CAN YOU NAME THE PSYCHIARIST?
1. Dr. Squid
2. Dr. Clams
3rd runner up: Dr. often making wildely exagerated claims.
I have worked as an Underwriting Manager for 3 Companies and as a Marketing Manager for 4. I can remember delivering Profit Sharing checks to agents with only a few Hundred Thousand in written premiums on the books and the check was for $78,000.00 because…. they reached the minimum W.P. to qualify and had E.L.R.\’s in the 10% bracket.
Those checks are not just for \”steering\” business but, require a profit margin that is \”difficult\” to reach at any rate levels that the companies have filed in each state. And, it\’s not just the \”Big Boys\” that get them. Agents as small as $100,000 in premium volume can attain check with some companies if, they make a PROFIT.
I feel that the agents that complain about them probably either arn\’t even a agent (Just a \”broker\”) or don\’t even know what is involved in trying to make a Underwriting Profit for the company that they have a contract with because, they don\’t have a \”contract\” to protect.
State Farm Ins. also uses the SSI/SDI Office with their brand if of, Dr. Scratchansniff. High off Lottery winnings! right there with Foundation Health, Health Nets Corporate MGR\’s.
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I work hard to underwrite profitable business for me and my companies. Now some are calling me immoral. I resent that.
I find this most recent position self serving.
If quality of business placed with a carrier is meaningless then you will see that reflected in increased pricing.
Are risk managers so dumb that they can be \”duped\” by a broker into taking an inferior or over priced product? I don\’t think so! Personally, I don\’t care for the contingent commission approach. I would prefer a higher \”normal\” commission, but, since when is a incentive based compensation program evil? I can\’t think of an industry that doesn\’t use incentive compensation with its sales force.
OK – I\’ll spot you one experience rating discount.
But your \”volume\” of premium gives you an unfair discount & advantage over smaller competitors. Let\’s eleviate it.
The part that troubles me is \”Failure to disclose such arrangements runs counter to the spirit of partnership that risk managers seek to achieve with their brokers, vendors, and insurers.\”
Partnerships? OMG, you may have to get outside of your comfort zone and contact another broker? Heaven forbid. Bottom line…if you don\’t trust your current vendor to get you the most competitive price for the most comprehensive coverage, then it\’s time to switch vendors.
I am a small, main-street independent agent and I disagree with the notion that contingencies cause a conflict of interest. The contingencies make sure I don\’t start placing marginal business (read: overly susceptible to loss) in preferred companies. I don\’t have the ability, due to competition, to \”bid rig\” or steer business. Many of my competitors have the same companies as I and the companies give everyone the same quote.
I do not deal with risk managers because the companies I insure are smaller.
While I agree that the bid-rigging/steering scandal that happened is unethical and greedy, I lay much of the blame on the highly paid, highly educated risk managers that allowed them to get away with it simply because they were too lazy/busy to contact another broker/company for alternative quotes. This is what your being paid for RIMS members…if you don\’t understand the insurance business, then you can\’t do your job effectively.
(Doc\’s Poetry Corner Wrap-Around) town of Los Gatos Community Hospital, Los Gatos, CA.
Patient Debbie, Debra, Deborah recites a poem about how she is a teapot after an auto-mis-hap, (Insurer-State Farm) but is making progress according to her psychiatrist. She thought she was a toaster oven the week before.
CAN YOU NAME THE PSYCHIARIST?
1. Dr. Squid
2. Dr. Clams
3rd runner up: Dr. often making wildely exagerated claims.
XXLawyer
So all insurance carriers should have the pay the same commission percentage, so as not to create a conflict of interest?
So all insurance carriers should have to pay the same commission percentage, so as not to create a conflict of interest?
I have worked as an Underwriting Manager for 3 Companies and as a Marketing Manager for 4. I can remember delivering Profit Sharing checks to agents with only a few Hundred Thousand in written premiums on the books and the check was for $78,000.00 because…. they reached the minimum W.P. to qualify and had E.L.R.\’s in the 10% bracket.
Those checks are not just for \”steering\” business but, require a profit margin that is \”difficult\” to reach at any rate levels that the companies have filed in each state. And, it\’s not just the \”Big Boys\” that get them. Agents as small as $100,000 in premium volume can attain check with some companies if, they make a PROFIT.
I feel that the agents that complain about them probably either arn\’t even a agent (Just a \”broker\”) or don\’t even know what is involved in trying to make a Underwriting Profit for the company that they have a contract with because, they don\’t have a \”contract\” to protect.
State Farm Ins. also uses the SSI/SDI Office with their brand if of, Dr. Scratchansniff. High off Lottery winnings! right there with Foundation Health, Health Nets Corporate MGR\’s.
Talk about that Dumb!!!!