Health insurance agents frequently claim that pay does not determine where they place business, emphasizing product suitability, client needs, and service as the primary influences. We conducted a recent survey of agents that uncovered a subtler picture. Although those elements still matter, pay structures—such as base commissions, bonuses, and other incentives—significantly influence placement choices for a notable share of agents. Sales contests and recognition programs also exert a disproportionate effect, highlighting that motivation includes competitive drive, achievement, and professional status in addition to monetary rewards. For insurers, these results have obvious consequences.

A competitive, thoughtfully designed compensation package is more than a basic necessity—it differentiates firms in attracting and keeping agents and brokers who will sell your offerings. Creating and administering these programs, though, is complex. Incentive plans must strike a balance among fairness, regulatory requirements, and strategic growth objectives while adapting to changing agent and broker expectations. Increasingly, this calls for dedicated technology that can model, administer, and monitor sophisticated compensation schemes at scale.