How does a broker get paid? Is there a fee?

Offering employer-sponsored and voluntary insurance programs to your employees should be clear and straightforward. Many employers use a broker to help select, enroll, and manage benefit programs. Choosing the right broker is crucial in building the right benefits package for your company.

The insurance carrier pays brokers a commission, and many insurance carriers will only offer coverage through a broker. Commission fees from the carrier are paid as a per-employee per-month fee or a percentage of the total monthly premium based on enrollment. While the way the carrier pays the broker may vary, employers should not be paying a fee directly to the broker.

While the insurance carrier pays the commission, some brokers will charge a fee for additional services such as enrollment platforms, HR systems, and specific compliance documents.