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Legal
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You are entitled to know how your broker makes money, because that is what lets you judge our advice. The short version: an insurer pays us a share of the premium when we place your policy, and that share is already inside the price you're quoted. Some insurers also pay us a bonus at year end based on how our whole book performs, not on any one policy. Occasionally we agree a fee with you directly, and when we do you'll know the amount before anything is bound. The longer version is below, and you can always ask us what we earn on your specific placement.
This is how we are paid in nearly every case. When an insurer issues your policy, it keeps part of the premium and passes a percentage to us for placing the business and looking after it — answering questions, issuing certificates, processing changes, and standing with you at claim time.
That commission is already built into the premium you're quoted. It is not added on top, and declining to use a broker would not ordinarily reduce what the insurer charges. The percentage varies by insurer and by class of business; commercial lines are generally in the low-to-mid teens as a share of premium, though it differs between products.
Because commission is a percentage of premium, a more expensive policy pays us more. We think you should know that plainly. It is also why our advice is worth checking against the market rather than taken on faith — and why we are willing to tell you, in writing, what we earn on any placement you ask about.
Most insurers also run annual arrangements that pay brokers a further amount based on how the broker's overall book of business performed — typically some combination of how much business was placed, how much of it renewed, and how the claims on it compared with what the insurer expected.
These are calculated across a whole portfolio at year end, not policy by policy. There is no practical way to say what any single policy contributed, and no one at this brokerage is paid a bonus tied to placing your policy with one insurer over another for this reason.
It is still a real interest, and we would rather name it than leave you to discover it. The safeguard is that these arrangements reward retaining clients and placing business that performs — which is a different thing from placing business at the highest price. If you want to know whether we hold such an arrangement with the insurer we are recommending to you, ask, and we will tell you.
Most clients never pay us a fee; commission covers our work. On more complex programmes — several locations, layered coverage, unusual exposures, or a project needing significant analysis — we may agree a fee with you instead of or alongside commission.
Where a fee applies, we will tell you the amount and what it covers before coverage is bound, and we will confirm it in writing. We do not charge fees that appear only on an invoice after the fact, and we do not add service charges to a premium without telling you first.
Some coverage is not available to us directly from an insurer and has to be arranged through a managing general agent or wholesale broker — this is common for specialty risks, harder-to-place classes, and certain surplus lines.
In those cases the intermediary also earns a share of the premium, in addition to ours. This does not usually change what you pay, because the total commission is set within the premium rather than added to it. We use these channels when they are the way to reach the right coverage, and we will tell you when a placement is going through one.
Premiums you pay us are held in a separate trust account until they are remitted to the insurer. Depending on the bank arrangement and how long funds are held, that account may earn interest, which belongs to the brokerage. It is a small amount and it is not a reason we would ever delay remitting a premium.
Where we arrange payment by instalments through a premium finance company, that arrangement may also generate income for us. If instalments are being proposed to you, we will tell you the cost of financing so you can compare it against paying annually.
Advisors here are compensated through salary and performance-related pay that reflects the business they write and the clients they retain. That means an advisor does earn more from a larger placement — the same tension that exists at every brokerage, and one we manage through supervision and file review rather than by pretending it isn't there.
No advisor is paid a bonus by an insurer for steering business to that insurer, and no advisor's pay depends on which insurer a policy lands with.
The honest list is short. Commission rises with premium. Contingent arrangements give us an interest in the insurers we place volume with. Advisor pay reflects business written. Each of those could, in principle, pull against your interest.
What we do about it: we quote across our panel rather than defaulting to one insurer, we put the reasoning for a recommendation in writing where the choice is close, and we will disclose our compensation on any placement when you ask. If we ever have an interest in a transaction beyond ordinary commission, we will tell you before you decide, not after.
We hold no ownership interest in any insurer, and no insurer holds an ownership interest in us. Our panel of 17 insurers exists so that a recommendation can be genuinely compared — that independence is the product.
We do not charge undisclosed fees, and we do not mark up premiums. We do not accept payment from any provider to appear in our business network — membership is free with an active policy and we take no share of anything members agree between themselves. We do not sell your information.
You can ask what we earn on your policy at any time, before or after it is placed, and we will answer specifically rather than generally. Contact Insurabiz at [email protected] or 613-355-3130 (Monday to Friday, 8:30 AM – 5:00 PM).
If you are not satisfied with the answer, you may raise it with the insurance regulator in your province, which supervises broker conduct and compensation disclosure.