Your broker legally has to disclose their compensation. Have you asked?
Most employers don’t know this: every time you pay your health insurance premium, 5-20% goes straight to your broker as commission. When your premiums increase 10% next year, your broker’s paycheck increases too.
That’s backwards. If your costs are rising, it’s likely due to poor plan design or lazy management. Why should your broker profit from their own mediocre work?
Why This Keeps Happening
Unfortunately, 95% of brokers in our industry fall into at least one of these categories:
Taking the easy route – Spreadsheet comparisons, cost-shifting, carrier swaps. It’s easier to negotiate a lower increase and call it a day than to do the real work of designing a sustainable plan.
Misaligned incentives – Some carriers pay brokers 2-3x more commission than others. When that happens, those are often the carriers being “recommended” – regardless of whether they’re the best fit for your organization.
Limited expertise – Many brokers simply don’t understand alternative funding strategies or how to design plans tailored to your unique workforce and objectives.
A Different Approach
At DSG, we remove commissions from the equation entirely. No outside influencers. No conflicts of interest. Just objective guidance based on what’s best for your organization, not our bottom line.
We’re willing to put our fees at risk because we’re confident we can deliver results. That’s the difference between being an advisor and being a product pusher.
What You Need to Do
Ask your broker how much they’re earning in overrides and bonuses above their base commission. They’re legally obligated to disclose this information.
If they’re not volunteering it, they’re withholding it. If you’re not asking for it, you’re creating a major fiduciary liability for your organization.
Something to Consider
If you’re getting low increases in the fully insured world, you should be self-funding. Otherwise, you’re just making the carriers rich while your broker collects their cut.
It’s time to look at this differently. Your second or third largest business expenditure deserves better than the status quo.
DM me for more information