How can an insurance agency waive their brokers fee's in order to sell the policy.?

Question

i requested different quotes and one of then will match the lowest policy by waiving this fee. do they also make money by selling the policy ? i am just curious how they make money

Answer 1

As Flyboy mentioned, this is known as rebating in 99.9% of the cases which is illegal in Canada as well.  There are however some companies that offer 'preferred' or 'standard' admin fees, which might lower the cost for you (and the advisors commissions as well).  In a recent case where I was able to do that, on a $60 premium a month the discount worked out to be $1.80 or so...not a huge difference.  

PS: Don't buy price, buy on service and the need.  Go to a licensed insurance broker.  They'll shop it around and find a policy that suits you.  Cheaper is not always better....China makes super cheap toys for kids...ever hear of the lead poisoning scare a little while back? (not a hack on China...just a good example of cheaper not being better when you get a low quality product).

Answer 2

In most if not all states they can not legally do this.  It is called rebating.  Insurance brokers make money by selling and receiving a commission.  True brokers of most casualty insurance agencies can sell policies with most any company.  I would not do business with someone who told me they were going to do something illegal in order to benefit me.  How could you trust them not to do something harmful to you?

Answer 3

The brokers fee is in addition to the commission they receive from the insurance company. The fee is set by the broker and therefore is negotiable. I, however, would not expect the broker to waive the fee completely.

Answer 4

You could try to google it ,here is some direct resource might be helpful.

http://insurance.freetipz.info/insurance...