Glossary
Broker Fee
A charge an agency bills a client for its own services, separate from the premium and the commission the carrier pays.
Broker fees compensate the agency directly rather than through carrier commission. They are common on surplus lines and on accounts where commission alone does not cover the work involved.
Their permissibility is state-specific: some states restrict them, cap them, or require written client consent. Because a broker fee is agency income rather than carrier money, it never belongs in the premium trust account.
See also
- Policy Fee — A flat charge added to a policy by the carrier or general agent to cover issuance costs, usually fully earned and non-re…
- Surplus Lines — Coverage placed with an insurer not licensed in the insured's state, permitted when admitted carriers decline the risk.
- Trust Account — A segregated bank account where an insurance agency holds premiums collected from clients on behalf of carriers. Strictl…