Utah Admin. Code R590-207-4 - Commission Schedule Structure

(1) A carrier may not structure a producer commission schedule that, directly or indirectly, creates a restriction, hindrance, or barrier to access to coverage for the smallest groups or groups with the greatest health risks.

(2) The commission in the commission schedule for the smallest groups or the groups with the greatest health risks may not be designed to avoid, directly or indirectly, the requirements of guaranteed issue or renewal in the marketing of health insurance to small business owners.

(3) An insurer may not design a commission structure that lessens the incentive to insure a small employer group that is smallest in size or with the greatest health risks.

(4)

(a) An insurer is not required to base commissions on a percentage.

(b) An insurer may elect not to pay commissions on all business.

(c) An insurer may elect to pay a dollar amount based on factors other than risk characteristics.

(5) Examples of commission structures that comply with this rule include:

(a)

(i) a 10% commission for group size 2-5;

(ii) a 9% commission for group size 6-25; and

(iii) a 7% commission for group size 26-50; or

(b)

(i) $20 per member per month (PMPM) for group size 2-5;

(ii) $18 PMPM for group size 6-25; and

(iii) $16 PMPM for group size 26-50.

(6) An example of a commission structure that does not comply with this rule is:

(a) 3% commission for group size 2-5;

(b) 8% commission for group size 6-25; and

(c) 7% commission for group size 26-50.

Notes

Utah Admin. Code R590-207-4

Amended by Utah State Bulletin Number 2022-16, effective 8/8/2022