Life insurance commissions have been a recent hot topic in the Canadian personal finance community. Certain types of policies pay more first year commission (FYC) than others and this creates the potential for some unscrupulous advisors to give bad advice to their unassuming clients.
Consumers have the right to know how their agent is compensated for the type of coverage they are taking out. The risk of a few bad agents recommending only high-paying products is real, so consumers should be aware of how their agent is being compensated to make an informed decision based on their actual needs.
Check out our infographic below which breaks down the commission payable on some common life insurance products.
Does the agent get a commission if the customer renews the following year or commission only paid when the original purchase is made?
Thanks,
Larry
Most insurance companies pay a renewal commission although the substantially smaller than the upfront commission. Some companies have talked about and switch to a more levelalized commission. This would create a more stable revenue stream It may lead to better on-going servicing of clients.