When a renewal commission stops arriving, the carrier usually didn't decide to stop paying you. Something changed on the policy, on your producer record, or on the carrier's side, and the payment followed that change.
This is a list of places to look, not a diagnosis. Only the carrier can say why a particular payment didn't come, and the answer is sometimes ordinary. But if you go in knowing which of the ordinary explanations you have already ruled out, the conversation goes better.
This article assumes you have already confirmed the policy actually renewed. If you are not sure it did, start there. A policy that lapsed quietly will look exactly like a missing commission.
1. The carrier changed how it identifies the policy
A new policy number, a term suffix, a policy re-issued after a mid-term rewrite, or a move between companies in the same carrier group can all separate the renewal from the record that used to pay you. The money may well have been paid. It just isn't under the number in your book.
Before concluding anything, search the statement by insured name and renewal date, not only by policy number. Names are often truncated or reordered, so try a fragment.
2. Your appointment or codes changed
Several things live here, and they look alike from the outside:
- Appointment ended. If a carrier appointment is terminated or lapses, renewal payments on existing business may continue, reduce, or stop, depending on your agreement. Read the contract. Don't assume either way.
- Agency or producer codes changed. After a merger, an acquisition, a move between networks, or a name change, policies can stay attached to the old code. Commission is then paid to a code you may not be watching.
- A producer left and the book was reassigned. Splits are set per producer. A policy can sit on a former producer's record and pay nothing to anyone you would expect.
If every renewal from one carrier is missing, this is the first group to check.
3. Another agent of record
When an insured signs a broker of record letter, or simply moves to another agent, the carrier may transfer the policy at the next renewal or sooner. From then on the commission goes to the new agent, while your own system may still show the policy as yours.
Whether that is legitimate depends on the paperwork. It is worth confirming the transfer was one you knew about.
4. The rate or schedule changed
Carriers revise commission schedules. A change can apply to new business, to renewals, or to both, from a stated effective date. Renewals often pay a lower rate than new business from day one, which is normal.
The useful question is whether the rate paid equals the schedule in force on the renewal date. A cut you were notified of is not an error. A cut nobody told you about is a question to ask.
5. The premium base changed
Commission is a percentage of something. If the policy was endorsed, audited, or renewed at a lower premium than you assumed, the commission shrinks without any change in rate. A renewal that looks 20% short may simply be a renewal on 20% less premium. Check the renewal declarations before you raise it.
6. The insured didn't pay, or paid late
On direct bill, commission generally follows collection. A non-payment cancellation can cancel the renewal, and a late payment moves the commission onto a later statement, so it may simply not be due yet.
Agency bill runs the other way. You may have kept a commission on a renewal that was never collected, and it could be charged back later. A missing payment and a pending chargeback can be two views of the same policy.
7. The carrier made a mistake
This happens, and it is the reason to do the check at all. A renewal can fail to load, be keyed against the wrong code, or be left out of a batch.
It belongs last on the list, though, for a practical reason: carriers will ask whether you have ruled out the ordinary causes, and a request that already answers those questions is easier to resolve.
Telling the causes apart
A rough guide, not a rule:
- One renewal missing, others from that carrier paid. Look at a policy number change and the insured's payment status.
- Every renewal from one carrier missing. Look at appointment status, agency code, or a statement that never arrived.
- Paid, but lower than expected. Look at a schedule change, the premium base, and renewal versus new-business rate.
- Policies from one producer missing. Look at the producer record, reassignment, and splits.
- Paid to someone else. Look at a broker of record transfer.
When you ask the carrier
Send the policy number as it appears in your system, any number you suspect it changed to, the insured's name, the renewal effective date, the rate and amount you expected, and the statements you already checked. Ask which agency code the commission was paid to and which rate was applied.
Keep the answer. Carriers can give different answers to the same question a few months apart.
How far back you can claim depends on your agreement and, in some cases, on state rules. We can't tell you the limit for your carrier, which is a good reason not to let renewals sit unchecked for a year.
Why this is hard to keep up
Each cause above lives in a different place: the policy system, the producer records, the carrier's schedule notices, the statement itself. Finding a missing renewal means comparing every policy in your book against every statement, and the statements arrive in each carrier's own format. It is not hard in any single case. It is hard to do every month, for every carrier, without a gap.
That monthly comparison is what we are building Lapidar to do. It isn't available yet.
Lapidar checks carrier commission statements against your book. To follow along, join the early access list at getlapidar.com.
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