Commissions

  • "compensation patterns and product design"
  • "Special Compensation" - "incidental advice"
  • Renumeration
  • levelized commission program

From a distribution perspective, I think one of the challenges that face us in UL is the servicing of UL. 

  • Flexible premium, high-degree-of-service UL products have little or no renewal compensation paid if there’s no premium paid. 

--  Daniel F. Byrne, M Financial

1999 - SOA - The Next Generation Universal Life, Society of Actuaries - 30p

We designed commission rules that anticipated a relatively large number of rollovers of existing policies; full commissions are paid provided:

  • the new universal life face amount is at least two times the face amount of the replaced policy.
  • All cash values are rolled over to the universal life policy.
  • The new premium is at least equal to the current premium.

--  Phillip B. Norton, not a member of the Society, is Vice President of The Lincoln National Life Insurance Company


1983 - SOA - Individual Life Insurance Retention and Replacement Strategies, Society of Actuaries - 24p

  • 1976-4, NAIC Proc. - Life Agents' Compensation Task Force
  • 1979 - SOA - Future Trends and Current Developments in Individual Life Products (rsa79v5n44), Society of Actuaries - 24p
  • 1981 0921 -  GOV (House) - Insurance Agent Commission Deregulation - [PDF-109p-GooglePlay,
  • 1983 - SOA - Individual Life Insurance Retention and Replacement Strategies, Society of Actuaries - 24p
  • 1990 - LR - Statutory Prohibitions on the Negotiation of Insurance Agent Commissions: Substantive Due Process Review Under State Constitutions, Robert H. Jerr, II and Reginald L. Robinson - 50p
  • 1990 - SOA - Designing a Field Compensation Structure, Society of Actuaries - 22p
  • 1998 - SOA - Insurance Compensation Trends and Outlook, Society of Actuaries - 27p
  • Mr. Birdsall asked if the agent compensation structure for IUL products provide greater incentives for agents than is provided by the compensation structure of traditional universal life (UL) products.
  • Mr. Samuelson (MetLife) said that a compensation study he had previously conducted found that, on average, IUL policies have a target premium 80% higher than the average target premium for UL products.

2014 1114-15, NAIC Proceedings -  IULWG - 6-63

William Albus (National Association of Life Underwriters) commented that:

  • ...the requirement for disclosing sales commissions is unnecessary because it is superfluous and would only confuse consumers.
  • ...the purpose of disclosure is to provide information for making an informed decision and the disclosure of sales commissions has nothing to do with making this decision.

1988-2, NAIC Proc.

  • The other question I have, coming from the standpoint of a mutual company, is that with our agency system it would be hard for us to replace whole life insurance with a commission rate that is around the level of a YRT commission plus 3% of premium.
  • That is about 10% of what we are now paying in the first year on a permanent insurance plan.

1979 - SOA - Future Trends and Current Developments in Individual Life Products (rsa79v5n44), Society of Actuaries - 24p 

  • Longer guarantees with corresponding higher gross premiums further increase commissions.
  • There is an incentive for agents to sell longer guarantees even when they are not needed.

--  Brian Kavanagh

1995 - SOA - Life Valuation Issues -- XXX / Regulation 147, Society of Actuaries - 16p