Insurance agency owners need to pay their producers.
At the end of the day, the carrier reconciliation process determines how much and when the producer, or salesperson, will get paid. The agency needs to stay on top of it to make sure all the money that was set to be paid has been collected so commissions can be processed.
However, carrier reconciliation can be an extremely time-consuming and error-prone process.
Here are a few common pain points I have heard from agencies:
Pain point: "It takes too long to import multiple carrier statements for reconciliation."
Each carrier has a different format. As soon as we have a process, the insurance carrier changes the formatting of their statements, and we have to start again.
Pain point: "We are too dependent on one person."
The person who processes commission statements has their own system, usually involving an incredibly complex spreadsheet that nobody else is allowed to touch. If that person is out of the office or leaves the company, someone else has to try to decipher their system to get commissions processed.
Pain point: "We know we are leaving money on the table."
Producers don't like to wait for their money. So we often just "guess" that the commission will be the same as last month to get it paid and keep everyone happy. However, the carriers sometimes make mistakes that we miss. Amounts can change because a term has expired. Without the reporting to provide visibility into actual versus expected commissions or a reconciliation of commissions by carrier, there's no way we can be confident that we are paying the right amount.
Pain point: "If a producer questions the size of their check it takes too much time to research."
We waste time researching details if a producer comes back and asks why his commission was a specific amount because that data is not easily accessible to everyone.
How long does commission calculation take?
Some agency owners have told me that it takes one person 40 to 80 hours a month to reconcile the previous month's commissions. It's a job no one wants. It's a job that I've seen people quit over because it can be so unmanageable. But it is so important. Sales are what "keep the lights on."
I have also seen agencies complete their commission calculations in less than one day. It is all about having the right tools built for the task.
BenefitsBridge provides an easy way to import multiple carrier statements.
Even if the format of the statements changes month to month, the system will identify the differences so they can be addressed. Once it is approved, the statements are imported, and it will automatically apply the payment amount received from the carrier to the policy and compare that against what was expected. If the amount is different, you can drill into the details. If the amount matches, then that is the green light for the agency to cut a check to the producer.
Information you need is not floating around in someone's inbox or in their heads. You are no longer relying on just one person. You have one reliable system of record.
You can halve the time it takes to answer questions from a producer who questions the size of their check every month. Perhaps the carrier paid a different percentage based on specific intervals, or partial payment was received. All of that information will be in BenefitsBridge.
Any agency receiving commission statements from multiple carriers every month can be more efficient with a system like BenefitsBridge.
Simple carrier reconciliation is just one benefit of BenefitsBridge.
By Ryan Plourde, Crowe, a Microsoft Dynamics 365 Gold Partner
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