Commission

What Does Commission Mean?

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

Insuranceopedia Explains Commission

The commission varies based on factors such as the type of plan purchased, the premium amount, the insurance company, and the marketing methods used. For life insurance, commissions typically range from 10% to 25%, while for term and permanent policies, they can range from 25% to 55%. For non-life insurance policies, such as auto insurance, the commission is generally between 8% and 16% of the premium paid by the client.