Insurance producers can't "double bill," state says

A bulletin issued by an insurance department clarifies the state law regarding producer compensation.

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Citing requests from producers who wanted clarification, the New Hampshire Insurance Department has issued a bulletin elucidating the state law behind producer compensation.
 
Under New Hampshire law, insurers can pay and producers can receive payment for insurance “by way of a commission, service fee, brokerage, or other valuable consideration.”
 
The bulletin points to the use of “or” to indicate that producers who receive payment for an insurance contract cannot also require a service fee for the same transaction.
 
In addition, the department also declared that insurance companies and producers can engage in agreements that are incidental to a contract, but a producer cannot receive payment from that company while also seeking payment from the insured for the same services.
 
“Essentially, we are telling producers that they cannot double bill: get paid twice for doing something once. If they are receiving compensation from an insurance company, they cannot then seek compensation from an insured client for the same service,” a department spokesperson told Insurance Journal.
 
Producers can, however, receive payment from the insured for transactions unrelated to the contracts that they have with the insurance company.  To do so, they need to draft a distinct contract and charge a separate fee.
 

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