How Long Would You Pay Commissions?

Discussion in 'Employee Benefits Forum' started by sdinsure4life, Jul 7, 2017.

  1. sdinsure4life
    Offline

    sdinsure4life Member

    Posts:
    5
    Likes Received:
    0
    State:
     
    Scenario: A friend (Another independent Life & Health agent) obtains the group business (Health, Dental, Vision, Group Life, etc.) of a 40-50 person group & asks you to become involved.

    The HR person asks you to become the AOR (Agent of Record) on this case.

    All of the commissions are coming to you and you are getting a 60% split on the commissions and forwarding the rest on your business check to the originating agent and providing them with a 1099-Misc. form every year for tax purposes.

    The originating agent always drops whatever they are doing in their own agency and helps you every time you ask for help in preparing new EE packets, enrolling EEs on site, helping with presentations, entering data into the computer, ie., anything that you ask him or her to do, they do it without fail.

    Q. Assuming this group is a long-term client, continuously paying their premiums on time, how long will you continue to pay the agent their 40% commission?
     
  2. leevena
    Offline

    leevena Well-Known Member

    Posts:
    1,063
    Likes Received:
    3
    State:
     
    Assuming the facts above, and no other wording to the agreement you made with the other agent, I would say you should pay for as long as you have the group.

    Not trying to be combative, but why are you even asking? I feel like there might be some other issue/fact that has not been presented above. I get that you may feel like you deserve more if you believe you are doing all/most of the work.
     
  3. VolAgent
    Offline

    VolAgent Well-Known Member

    Posts:
    13,177
    Likes Received:
    20
    State:
    Tennessee
    The OP has asked this question before, I guess he/she didn't like the answers then.

    Next time have an agreement. Until then, do as leevena said and pay as long as you have the group.
     
  4. adjusterjack
    Offline

    adjusterjack Well-Known Member

    Posts:
    297
    Likes Received:
    8
    State:
    Arizona
    Turns out the OP is actually the originating agent who has already had his/her commission reduced per agreement.

    http://www.insurance-forums.net/for...would-you-do-scenario-t88614.html#post1184241

    All I can tell you, sdinsure4life, is that without a written contract, as a practical matter, you are stuck with whatever your "friend" wants to pay you, unless you want to go to court and convince a judge that you had a better agreement.

    Knowing what somebody else would do under any given set of circumstances isn't going to help you one bit.
     
  5. sdinsure4life
    Offline

    sdinsure4life Member

    Posts:
    5
    Likes Received:
    0
    State:
     
    Hi,

    Thank you for your reply. It's complicated, but I was happy with the answers I was given.

    The scenario I described a few weeks back is what another agent did to me. I was the originating agent and the other agent I invited to help me was a dear (At the time) friend who became the AOR.

    After 15 months of my helping on the case and being paid commissions at 40%, the agent decided to cut my commissions to 25% with NO prior warning or even the slightest dissatisfaction of my participation in the ongoing maintenance of the group.

    After I protested by asking my Legal Shield attorney to send the other agent, the agent's attorney sent me a letter containing many lies concerning my involvement in the case and making the offer of $125/month for about 1 & 1/2 years.

    Needless to say, I did not accept their offer. Now I find myself in the position of losing the income from the group and the other agent has established a relationship with the group and I am left out of the equation altogether.

    Now, I have a glimpse of what the founder of a business experiences when they are kicked out of their own business - it doesn't feel good at all.

    Again, thank you for your understanding...
     
  6. leevena
    Offline

    leevena Well-Known Member

    Posts:
    1,063
    Likes Received:
    3
    State:
     
    I knew something was not right about your post above. Wish I could pick the lottery as well. Lol

    Now that I know the facts, I agree with the earlier post, without an agreement it appears that you may be out of luck.
     
  7. sdinsure4life
    Offline

    sdinsure4life Member

    Posts:
    5
    Likes Received:
    0
    State:
     
    Hi,

    I'm sure you will remember me when you win the lottery, right?

    Sorry about the confusion. I didn't know if the other agent is an Insurance Forum member, so I intentionally camouflaged my first posting. In retrospect, I should just have posted in the first-person and there would not have been any confusion. Thank you again!

    ----------

    P. S. The worst part is losing someone who you trusted & truly believed was a great friend for about 8 years, only to find that you get stabbed in the back.

    Rest assured that if it had been anyone else, there would have been a written agreement... Not sure what the moral of the story is for now, but I'm pretty sure it involves limiting trust with everyone...Not my favorite way to live, to say the least.
     
  8. VolAgent
    Offline

    VolAgent Well-Known Member

    Posts:
    13,177
    Likes Received:
    20
    State:
    Tennessee
    Yes, it does get confusing and hard to keep it all straight when details get added later. :yes:
     
  9. rousemark
    Online

    rousemark Well-Known Member

    Posts:
    13,036
    Likes Received:
    26
    State:
    Tennessee
    My practice was as long as I got paid the other Agent got paid. Seemed the only fair thing to do. Especially in cases where I would not have had the business without the other Agent bringing me in on the deal.
     
  10. VolAgent
    Offline

    VolAgent Well-Known Member

    Posts:
    13,177
    Likes Received:
    20
    State:
    Tennessee
    Depending on the policy type, that or just first year. For life, I have generally looked for and sent just FYC. For more level business like group, P&C, etc. then I agree a 110%. Split it as long as the revenue keeps coming in, baring an agreement otherwise.
     

Share This Page