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SOTSQ Episode 3 - Why Your Broker's Pay Could Be Misaligned

26 Jun 2018 · 1 min

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Andy Neary explains how brokers paid as a percentage of premiums have incentives misaligned with employers. When one group's premiums jumped from $1.48M to over $2M, the broker's pay rose too. He recommends employers ask if brokers still get insurer bonuses and tie broker pay to hitting plan goals.

Chapters

Let's talk about a third problem impacting your health plan today. Your broker's pay could very well be misaligned with your goals. If your broker is still earning a percentage of premium from the insurance company, they're completely misaligned with your goals. As your premium.
Goes up, so does their pay.
Here's one example.
Two years ago, this.
Group was paying $1.48 million. Broker was making $39,000 a year. Next year premium.
Goes up, so does the brokers pay.
2. Two years later, they're paying over $2 million in health insurance premiums. Brokers making $54,000 $19,000.
Pay raise to.
Watch their clients premium almost go up a half a million dollars. Now, if you're paying your broker.
A consulting fee, good.
But you need to ask two questions. Number one, are they still earning bonus and overrides from the insurance company? If yes, compensation still misaligned with yours. And two, challenge.
Your broker to see.
If they'll put some of their compensation at risk to.
Help you achieve your goals.
That's the mark of a true consult week.
We're going to start digging into how.
To build an unhittable health plan. Have a great afternoon and we'll chat soon.