How an Insurance Broker Gets Paid

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The Early Days For a New Broker

When insurance brokers receive their state health and life insurance license, they become popular people. Every single day I am contacted by a vendor (in my case an insurance vendor) eager to partner with me to deliver “value” to my clients. I’ve recently been offered: Caribbean vacations, piles of gift cards, motor scooters, and most tempting…cold hard cash. Early on I wondered if HR managers, CFOs, and Business owners knew how their broker gets paid? Now, through my experience I can tell you: they’re shocked to learn the truth.

Their insurance companies and vendors all had a common thread to messaging… sell our products to your clients and prospects, and we’ll pay you!

Early in my time here at mueller QAAS, I would share the different offers/promotions that came through my inbox, mailbox, and voicemail with the President. He walked me through offers as they came, and it eventually became clear – they weren’t going to stop.

Shouldn’t We Get Paid to Lower Cost?

Here’s the rub: I’m not sure how many of these programs will deliver savings and ultimately value to my clients.  In many cases, the incentive laced programs that I’ve been offered come with a price tag… (Per Employee Per Month add-ons, % of premium dollars…etc.) bells and whistles have their place, but I think additional compensation including bonus checks and vacations should come second to health and well being.

In our experience at mueller QAAS, we’ve seen the negative impact of Status Quo in the Milwaukee Insurance Broker community.

Consultant vs Broker 

Insurance has gotten more expensive for businesses in the past 10 years. I’m not going to win a Pulitzer tell you this.  As premium costs have grown, so have the buckets of money for companies to steer brokers to a specific product of program.

As a consultant, mueller QAAS is paid by businesses and non-profits in Wisconsin to help answer: how do we deliver benefits in the most cost effective way possible? In a lot of cases, there is 20-30% cost differential between what brokers are recommending and our proposal.

Allow a 2nd Opinion – A Good Broker Should Suggest It

It’s not my place to speak for insurance brokers in this community. My plea is for employers to strongly consider what kind of pressure might be in play with your broker. I can tell you that working with a consultant like mueller QAAS who does not accept any insurance carrier incentives, has enormous impacts for a growing number of Wisconsin organizations.

If a 2nd opinion yielded 25% on your second biggest spend, would you allow us to prove ourselves?