MLR Spells Trouble for Agents and Brokers

With the Affordable Care Act (Obama Care) making it a mandate that health companies include commissions in the medical loss ratio (MLR), brokers find themselves in a troubling predicament. If this is not reversed many companies, in not all health companies, will stop paying commissions. This has already started to happen in big premium cases. This trend also puts a tremor down the spine of P&C agents. I can see big stock companies getting rid of commissions on big premium cases. Large comp policies already have commissions at 3% or less with many companies. The MLR issue is still being argued in Washington and could be overturned or, the trend of not paying commissions in health insurance could continue and over time leak into the P&C industry.  Until next time be careful out there and know your risks. K

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