September 20, 2021

CA Broker Compensation


Transparency and shared expectations are gold standards of any successful business relationship. When it comes to a broker, employers should look for someone who keeps them informed about important issues related to their interests.

In that spirit, this article discusses new compensation disclosure rules and sets expectations for the future.

Broker Compensation Disclosure Rule

The Consolidated Appropriations Act (CAA) was signed into law in late 2020 and contains several provisions related to business transparency. Beginning Dec. 27, 2021, as part of the CAA, covered service providers (CSPs)—i.e., insurance brokers and consultants—must disclose all compensation to clients if they expect to receive $1,000 or more in direct or indirect compensation for providing their services. This means employers will be able to see exactly how brokers earn money, which can help inform plan decisions.

View Alert