We started Innovo Benefits to help HR leaders deliver more value to their organizations and better understand our industry. Truth be told, it’s not always clear how brokers get paid, how renewals are calculated or why brokers choose to work with a small group of carriers.
Did you know that brokers can earn bonuses across virtually all insurance lines? As a policy holder, you are indirectly paying those bonuses through your premium.
But you may ask, “what’s the risk?” Since bonuses can equal up to 30% of a brokerage’s total revenue, a broker may be incented to steer you toward a carrier who offers him a great bonus, but whose coverage is not the best choice for you. There is the potential for a conflict of interest.
To be fair, we don’t think bonuses are inherently bad, but still donate all of ours to charity just to remove any risk of impropriety.
Non-Standard Commission Levels
If you have a general idea of the industry’s standard commissions, you may not think to ask your broker what’s being paid by the carrier on your policy. However, for groups over 100 employees or even over 50 in some states, the broker actually has a say in the commission levels and can thus request higher than standard commission. We don’t believe in the practice, since it can create another conflict of interest. As such, we only accept a carrier’s standard level of commission.
Ask your broker what percentage of his revenue comes from his “top” carriers. If his income is concentrated with just a few carriers, you’re not getting the benefit of wide marketing. And maybe you’re paying too much for renewal. We don’t limit our choice of carriers, instead work with a large group to find the best value for clients.
What else should you know? Find out in our broker bonuses article.
How We Deliver Exceptional Value to Clients
We’re not swayed by bonuses – we give them to charity – and we use a proven renewal process to consistently deliver better rates for our clients. How does your last renewal compare to our average renewal numbers?
Our average renewal rate is just
for groups of 50+ without changing plan design or method of funding.
Actual Client Results – Example 1
|Original Carrier Renewal||+2.1%|
|Our Negotiated Renewal||-16%|
Actual Client Results – Example 2
|Original Carrier Renewal||+9.3%|
|Our Negotiated Renewal|
Committed to More than Profit
We believe we have a responsibility to our community and planet, so we adhere to an accounting practice known as Triple Bottom Line (TBL). It allows Innovo Benefits to see our performance as more than simply financial profits and losses.
TBL allows us to create better business value by focusing on three bottom lines: social, environmental and financial. As a nimble, independent broker, we actively choose innovative paths that deliver better service and value for our clients, partners, and the world.