How to write a commission discrepancy letter to a carrier

TL;DR

• Write one letter per carrier, group items by statement period, and list items, not impressions.
• Every item needs the same fields: policy, insured, statement and line, transaction, premium, rate, expected, paid, difference.
• Show how you got the expected figure: which premium, which schedule, which rate. That is what lets the carrier check you quickly.
• Ask for one of three things per item: payment, a corrected statement, or a written explanation. Give a date.
• Log what you sent, then watch the next statements for the correction, matched item by item.

The letter is the last step of a reconciliation, not the first. By the time you write it you should already know which items are wrong and by how much; finding them is covered in carrier commission statement reconciliation. We’re building Lapidar, a tool that will check commission statements line by line; it isn’t available yet. This guide is about property and casualty business, and about the letter itself: what to put in it, how to show your working, and what to do after it goes out. Practice differs between carriers, and your agency agreement governs.

What is a commission discrepancy letter?

It is a written request to a carrier about specific commission statement items that don’t match what your agency expected: a renewal paid at the wrong rate, a policy missing from the statement, a line paid twice, or a chargeback that looks too large. It goes to whoever handles commission questions at that carrier, often a commission or agency accounting team, or the contact your marketing rep or territory manager points you to. Some carriers want these questions through a portal or a particular mailbox; use what they ask for, and keep your own dated copy of the letter either way.

A letter beats a phone call for one reason: the person reading it can act without coming back to you. Every question the carrier has to send back adds another round trip before anything is paid.

What should the letter include?

1. Who you are at that carrier. Agency name, and the agency or producer code the carrier pays you under. If you have more than one code, say which one each item belongs to.
2. The period. The statements you checked, by date or statement number, so the carrier knows what you looked at. If a statement reached you as a download into your agency system rather than as a PDF, cite the carrier’s own statement date, not the date it posted on your side (see what is an AL3 file).
3. One row per item. Policy number as the carrier writes it (and as your system writes it, if different), named insured, transaction and effective date, statement date and line or “not on statements dated …”, premium, rate, expected commission, paid, difference.
4. How you worked out the expected figure. Which premium you used and where it came from, and which commission schedule, with its effective date, gave the rate.
5. Your evidence. What you are attaching or can send on request.
6. The request. For each item: pay the difference, send a corrected statement, or explain in writing why the amount is right.
7. A reply date and a reference. Your own reference for each item, so the carrier’s answer can be matched to it.

On agency bill business the same items usually surface on the carrier’s account current. Raise them with the carrier before the account current is due if you can, and remit as your agency agreement requires unless the carrier agrees an adjustment in writing; see agency bill reconciliation. The letter itself looks the same.

Leave out what the carrier can’t act on: totals without items, “we think we’re underpaid”, or a history of past frustrations. Keep it to items.

How do you show how the expected commission was worked out?

The carrier will check your figure against its own system. Give it the same three inputs you used, so it can repeat your arithmetic instead of guessing at it.

Expected commission = commissionable premium × rate on your schedule

• The premium. Say which premium and where it came from: the declarations page, the renewal confirmation, the endorsement. Not everything the insured pays is commissionable; policy fees, taxes and some surcharges are often excluded, and which ones differs by carrier and agreement.
• The rate. Cite the schedule by name and effective date, the line of business, and whether it is the new business or renewal rate. The rate printed on the statement is the carrier’s claim, not your evidence.
• The timing. On installment policies paid as premium is collected, say which installment you expect commission on, so the carrier doesn’t answer that the rest is “coming later” when you already allowed for that.

Renewal paid at the wrong rate · EX-52204Example data

Renewal premium, from the declarations page

$2,400.00

Renewal rate on your schedule

×12.00%

Expected commission

$288.00

Paid on the statement

$240.00

Difference to raise

$48.00

What evidence should you attach?

Enough for the carrier to confirm the item without asking. What that is depends on the kind of item:

Send references rather than whole client files where you can. The carrier already holds the policy; the policy number, the document name and its date are usually enough for it to find the rest, and you send less client information around.

A fill-in template

Adapt it to your carrier and your own voice. Everything in brackets is yours to fill in; repeat the item block for each item. The template is a starting point, not legal wording, and it doesn’t replace any notice your agency agreement requires.

TemplateFill in the bracketed partsSubject: Commission discrepancies, [agency name], agency code [code], statements [month(s) and year]

To: [carrier] commission accounting, or [the contact your rep named]

We have reconciled your commission statements dated [dates] against our book of business and the commission schedule effective [date]. The items below differ from the commission we expected. For each one, please pay the difference, send a corrected statement, or explain in writing why the amount is correct. For items paid to us twice, please confirm how you will reverse them. Negative differences are amounts overpaid to us.

Item [our reference]: [missing / underpaid / paid twice / chargeback]
Policy: [number as on your statement] ([number in our system, if different])
Named insured: [name]
Transaction: [new business / renewal / endorsement / cancellation], effective [date]
Statement: [date], page [n], line [n], or: not found on statements dated [dates]
Commissionable premium: $[amount] (source: [declarations page / endorsement dated …])
Rate on our schedule: [x]% ([schedule name], effective [date], [line of business], [new business / renewal])
Expected commission: $[amount]
Paid: $[amount]
Difference: $[amount]

[Repeat for each item.]

Owed to us: $[amount]   Overpaid to us: $[amount]

Attached: [list, one line per document, with the item reference it supports]

Please reply by [date] and quote our item references. If any item should go to someone else at [carrier], please tell us who.

[Name], [role], [agency]
[phone] · [email]

The template leaves the list of items to you. The letter takes minutes. Knowing which items belong in it, and being sure of each figure, is the work.

How should the letter sound?

Like a statement of account, not a complaint. Many discrepancies have an ordinary cause, a schedule not updated or a policy number changed at renewal, and the person reading the letter probably didn’t make the error. A few habits help:

• Say what you found, not what they did. “We could not find commission for this renewal on the statements dated …” is accurate and easy to answer. “You didn’t pay” invites a defense.
• Separate questions from claims. Mark the items you aren’t sure of as questions, and keep them apart from the items you can show.
• Keep the arithmetic visible. Exact figures, to the cent, with the rate and premium beside them. Round numbers look like estimates.
• Check your own side first. Some differences are on the agency’s side: a transaction never entered, a schedule you didn’t update. The common causes are in why statements don’t match your agency system.

What happens after you send it?

Pick a reply date that suits the size of the request, and write it in the letter. Turnaround varies between carriers. Then:

1. Log it. Date sent, to whom, each item reference, the amount, and the reply date.
2. Watch the next statements. A correction may come as an adjustment line on a later statement rather than as a reissued statement. Match it to the item it settles, and check the amount, not only that something arrived.
3. Follow up once, after the date. Send the original letter again with the items still open.
4. Escalate with the same letter. If the follow-up goes nowhere, your marketing rep or territory manager can often find the right person. Send them the letter and the follow-up, not a summary.
5. Keep the answer. Get explanations in writing and file them with the item, so the answer is still there when the same question comes up again.

How far back you can raise an item is set by your agency agreement. We can’t tell you the limit for your carrier, which is one more reason not to let statements sit unchecked for a year.

Why this is hard at scale

For one carrier and three items, the letter is quick. The hard part is everything before it, done for every carrier, every month. In an IA Magazine column from September 2026, Jake Gilbert of Vertafore, a company that sells agency software, describes what many agents end up doing to verify their pay: “They’re comparing commission statements against carrier reports, tracking policy activity, checking renewals and trying to understand why a payment changed.” It adds: “Even when everything is accurate, verifying commissions takes time away from serving clients and writing new business.” (IA Magazine, September 2026)

A good letter needs every item found, both ways: lines paid wrong, and policies with no line at all. It needs each figure worked out from your own schedule, the statement line for each item, and a log that remembers what was raised and whether it came back.

Where Lapidar fits

We’re building Lapidar to produce the item list for you: a discrepancy report for each carrier, with expected, paid and difference side by side and each item pointing to the statement line or book row it is based on, ready to print or save as a PDF. Lapidar won’t contact your carriers; whether and what you send stays your decision. It is in development and not live, it has no customers yet, and we’ll say so until that changes. If you’d like to try it when it’s ready, the early-access list is below.

Frequently asked questions

Should I send a commission discrepancy letter by email, by post or through the carrier’s portal?

Use the channel the carrier asks for; some want commission questions through a portal or a particular mailbox. Check whether your agency agreement says how notices must be given. Whichever channel you use, keep a dated copy of exactly what you sent.

How far back can I raise a commission discrepancy?

That is set by your agency agreement, and it differs between carriers. We can’t tell you the limit for yours. It is one more reason to check statements every month rather than once a year.

Should I put several carriers in one letter?

No. Each carrier has its own records, schedule and contact, so write one letter per carrier. Within that letter, group items by statement period and give each item its own reference.

Sources

1. IA Magazine, What Compensation Administration Means to the Agent-Carrier Relationship, by Jake Gilbert, September 16, 2026. Retrieved October 9, 2026.

Lapidar is commission reconciliation software for independent insurance agencies, in development. Related: how to dispute a commission chargeback · commission audit for independent agencies.