What is the Broker Compensation Disclosure?
This disclosure is part of CAA guidelines. If you're an insurance agent or broker, it requires you to disclose the commissions you expect to make from your customers to your customers before signing new deals or renewals.
When do I need to make the disclosure?
In general, you will need to make the disclosure to customers that are paying you commissions, directly or indirectly, of $1,000 or more on their combined health, vision, dental, and other plans covered by ERISA.
What can I do in AgencyBloc to find customers that need the disclosure?
If you're processing commissions in AgencyBloc, all you need to do is run the Broker Compensation Report. It will list every policyholder in your account and the total commissions you've received across their policies. It will also include all the data you need to disclose.
Note: You must have the Commission Module to use the Broker Compensation Report.
A policyholder may need the disclosure if you've received commissions of $1,000 or more from their policies.
How do I find customers that need the disclosure if I process commissions in a different system?
If you’re processing your commissions in another system, you may want to set up a custom field on your Policy records to indicate whether a disclosure is required for the customer. Please note that you must be an administrator to add, edit, or delete custom fields.
You could then run the Policies report to export the data from that custom field into a spreadsheet for review.
What kinds of information do I need to disclose?
Once you've identified policyholders that meet the requirement, you still need to make the disclosure.
Download this form to see everything you need to disclose.
If you’re using the Commission Module, you can run the Broker Compensation Report to retrieve all of the information you need to disclose your expected compensation.
If you aren't using the Commission Module, you could still add the necessary commission data to custom fields on your Policy records. Please note that you must be an administrator to add, edit, or delete custom fields.
You could then get the data from the Policies report by using the Coverage Type, Products, and Carrier information along with your custom fields to report an explanation (PEPM, %, formula) for the commission you expect to receive.
How do I track sent disclosures in AgencyBloc?
There are many different ways. To name a few, you can:
- Create an Activity on the Policy record and attach the completed form. We recommend this method because Activities can't be deleted so you'll always have a historical record around for auditing purposes.
- Add a note to the Policy's Notes/Attachments tab. Similar to Activities, you can also attach the completed form. Unlike Activities, notes can be deleted so keep this in mind.
- Create a Custom Field and use it to track whether you've sent a disclosure to the policyholder.
You can also use Automated Workflows to create and assign Activities whenever Policies are created or getting close to their renewal date. Learn more about Automated Workflow.