Broker compensation
The Insurance Company of Prince Edward Island (ICPEI) sells its products through brokers located in P.E.I., New Brunswick and Nova Scotia. These brokers are committed to working in the best interest of their customers and each broker represents a number of insurance companies.
These brokers provide professional advice and arrange for insurance coverage on their customer’s behalf. ICPEI believes this provides customers with the opportunity to choose the best value for their money.
Brokers receive commissions in exchange for services they provide in addition to providing professional advice and arranging insurance coverage, which includes tasks like processing mid-term changes requested by their customers and assisting customers in the event of a claim.
The commissions ICPEI pays to brokers are based on a percentage of premiums written for the corporation. The following is a summary of the broker commission schedule.
Property insurance:
- 20 per cent for standard personal and commercial insurance
- 15 per cent for specialty commercial insurance
Automobile insurance:
- 7.5 to 20 per cent for personal and commercial insurance
In addition to regular sales commissions, ICPEI brokers are eligible for a contingent commission when they write profitable business for the corporation. Contingent commissions are paid once a year and are based on the overall premiums and financial results generated by a broker for ICPEI products – not on any particular account or group of accounts.
In an average year, ICPEI pays profit commissions of approximately one to two per cent of total premiums written.
From time to time, as part of normal business practice, brokers and their staff are invited to participate in training and entertainment events. Brokers also pay a fee to attend an annual convention, which is primarily an educational event, but includes social opportunities as well.