Glossary · Insurance agency commissions
Carrier appointment
A carrier appointment is the carrier’s authorization for an agent or agency to sell its policies. In many states the carrier files it with the state.
What it means
An appointment is not the same as a license. The state licenses the agent; the carrier appoints them. Appointment rules, fees and filing requirements vary by state. Alongside the appointment, the agency usually signs an agency agreement with the carrier, which sets commission, billing and termination terms.
Agencies that can’t get, or don’t want, a direct appointment with a carrier often reach it through an aggregator or network. How that works, under whose code and on whose terms, depends on the arrangement.
How it shows on a commission statement
Statements are issued per agency code, sometimes called a producer code. Each direct appointment typically has its own code; business written through an aggregator sits under the aggregator’s code and is paid on its statement. After a merger or acquisition, an agency can have several codes with one carrier for a while.
Example
| Agency code | Access | Paid on |
|---|---|---|
| EX-AC-0412 | Direct appointment | Carrier statement |
| EX-AC-7730 | Through a cluster | Cluster statement, net of share |
| EX-AC-0299 | Acquired agency | Carrier statement, separate |
Common mistakes to check
- Policies written under the wrong code, so commission is paid somewhere you don’t look.
- Forgetting a code inherited from an acquisition until renewals stop appearing on the main statement.
- Assuming renewals continue unchanged after an appointment is terminated. The agency agreement decides.