Commission

What Does Commission Mean?

In terms of insurance, a commission is a fee in a percentage of the premium that an insurance company pays an insurance agent in exchange for soliciting applications for insurance for the company.

Insuranceopedia Explains Commission

The commission depends on the kind of plan purchased, the premium, the insurance company, and the marketing methods. Generally, for life insurance, it can range from 10 to 25% and 25 to 55% for term and permanent policies, respectively. With non-life insurance policies, such as auto insurance, the commission is generally 8 to 16% of the premium that the client pays.