Contingent Commission
What Does Contingent Commission Mean?
A contingent commission is a commission that is not paid at the time a policy is sold but is instead dependent on other factors.
Many insurance and reinsurance companies offer contingent commissions to agents and brokers, rather than traditional commissions, as they believe these are more beneficial for their businesses.
Insuranceopedia Explains Contingent Commission
Contingent commissions are often based on the profitability of the policies sold. For example, an insurance company may award a contingent commission to an independent agent if the policies they sell are projected to generate a certain level of earnings. This approach allows insurance and reinsurance companies to incentivize agents and brokers to not only sell policies on their behalf but also to prioritize those that will yield higher profits.
