Volkman Insurance Agency takes pride in the services we provide to you, our client, for insurance brokerage and other related services. For our efforts we are compensated in a variety of ways, primarily in the form of commissions and contingency amounts paid by insurance companies and, in some cases, fees paid by clients.
The means by which we are compensated are described below:
[hr]Commission Income
– Commission, normally calculated as a percentage of the premium paid to the insurer for the specific policy, is paid to us by the insurer for the distribution and servicing of your insurance policy. Our commission is included in the premium paid by you. The individuals at Volkman Insurance Agency who place and service your insurance may be paid compensation that varies directly with the commissions we receive.
Customer Service Centers
– Some of our carriers have direct customer service centers. They allow our customers to communicate directly with the carrier to discuss and modify any of their insurance coverage and requirements. This is additional support provide to our customers. Our agency is paid commission on these policies, but at a lower rate. The exact amount varies by insurance carrier.
Contingency Income
– We also receive income through contingency arrangements with most insurers. They are called “contingent” because to qualify for payment we normally need to meet certain criteria, usually measured on an annual basis. Contingency arrangements vary, but payment under these agreements is normally the result of growing the business by attracting new customers, helping the insurance company gather and assess underwriting information, achieving certain loss or claims results and/or working to renew the policies of existing insureds. There is generally no meaningful method to determine the exact impact that any particular insurance policy has on contingency arrangements; however, agencies tend to receive higher contingency payments when they grow their business and retain clients through better service. In other words, the amount of earned contingency income depends on the overall size and/or profitability of a group of accounts, as opposed to the placement or profitability of any particular insurance policy. For this reason, the individuals involved in placing or servicing insurance are rarely, if ever, compensated directly for the contingent income that we receive.
Supplemental Commissions
– Some insurance companies have recently added supplemental commissions. These commissions, in fixed amounts, are established annually in advance based on historical performance measured by criteria comparable to those by which contingent commissions are calculated. We refer to these commissions as guaranteed supplemental commissions, or “GSCs”.
Fees Paid by Clients
– On occasion, with more complex business insurance programs where additional resources, products or services are appropriate, a fee may be negotiated for placement of insurance coverage or additional services. Fees charged for the placement of insurance will be outlined in a proposal and approved, usually in writing, prior to the insurer binding coverage. On occasion, we may receive both commissions and client-paid fees for placing insurance, which generally will be disclosed in writing to you in advance.
Managed General Agents
– We use Managed General Agents licensed to conduct business in Illinois. These are intermediaries through which we can offer insurance products and services to clients that insurance products provided in the Excess and Surplus segment of the insurance industry. The Excess and Surplus lines are used when we are unable to secure insurance from standard, or admitted carriers. They are typically used when there is a unique operation or type of coverage, issues with loss history, or a new entity with no prior experience. Both Volkman Insurance Agency and the Managing General Agent will earn commissions, and is included in the premium paid by clients. These policies also often incur additional fees and taxes, which are specified on the policy as such.
Other Compensation and Benefits
We may receive revenue or further benefits from our insurance brokerage activities in other ways, including, but not limited to, from insurance company promotional events, and payments from insurers for promotional marketing and/or employee training and development.
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Our goal is to be your insurance agency of choice.
We know you have many agencies to choose from, so to earn your confidence, we hold ourselves to the highest standard of service. You should feel free to visit our website at www.volkmaninsurance.com for more information on how we do business. Please also feel free to ask any questions about our compensation generally, or as to your specific insurance proposal or placement, by contacting your agency or customer service representative directly, or by calling 630-897-8824.
We want you to choose Volkman Insurance Agency to be your insurance advisor and we intend to make your decision a good one.
