Health Insurance Broker Commission Overview
Your health insurance broker’s compensation is often built into the premium you pay rather than billed separately. That makes it easy to overlook and hard to know what your broker actually earns.
For fully insured group health plans, health insurance broker commission rates commonly range from about 3% to 7% of premium, with rates generally decreasing as groups get larger. On a $700,000 annual premium, that would mean $21,000 to $49,000 in annual commission.
The calculator above estimates the range your broker’s compensation falls into using your annual premium, enrolled headcount, and any overrides or bonuses you add.
How to use this broker commission calculator
Step 1 — Enter Your Annual Premium.
Enter the total annual premium for your group health plan, including both employer and employee contributions. You can find this on your carrier invoice or renewal summary.
Step 2 — Enter Your Enrolled Headcount.
Enter the number of employees enrolled in the benefits plan rather than your total company headcount.
Step 3 — Add Overrides or Bonuses.
If you know of carrier bonuses paid on top of base commission, add them here.
Step 4 — Add your work email and unlock the breakdown.
How Health Insurance Broker Commissions Are Calculated
There are three ways money reaches your broker. Most employers know about the first one.
What the CAA 2021 Requires Brokers to Disclose
The calculator gives you an estimate. For covered employer health plans, your broker is required to disclose specified direct and indirect compensation under the Consolidated Appropriations Act of 2021.
What Brokers Must Disclose
The law requires covered brokers and consultants to disclose specified compensation to a responsible plan fiduciary when they reasonably expect $1,000 or more in direct or indirect compensation.
What the Disclosure Includes
Base commission, per-employee fees, overrides and bonuses, and other direct or indirect compensation.
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