Search CompleteMarkets

... ,750 (30% of gross commission) . We have initiated compensation programs with additional bonus levels, as well: 15% of growth over 20% (above base) and 20% of growth over 30% (above base) provide incentive for producers to hit ever higher levels of commission. The best part of this type of compensation program is that the producer and the agency are penalized by lost business, because that business must be made up before growth bonuses can be earned. Previously, producers could earn higher new business commission in one year, lose much of the business in the next year, and earn the higher new business commission again for writing additional lines that may just bring their volume to prior levels. This is no help for the agency, which must continuously ... Growth commission is agency commission generated this year in excess of that generated last year. For example: If Bob Producer generates a total of $150,000 of commission last year and $200,000 this year, the first $150,000 would be paid as base commission and the next $50,000 would be calculated at a bonus rate as growth commission. Step Two: Institute a level-one bonus for growth. The current compensation levels most prevalent in our industry pay an average of 30% to 33% of the commission dollar to producers. Currently this is done in a 40% new business/25% renewal commission split. We suggest that base commission be established at 25%, with a level-one bonus for growth beyond base of 15% . This means that ...

...at the producer and the agency are penalized by lost business, because that bu...