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PIA Stands Firm in Defense of Agent Commissions

PIA National has reaffirmed its strong opposition to any legislation that would reduce the reimbursement rate for Write Your Own flood insurance carriers. PIA’s statement follows an initial markup by the House Financial Services Committee on June 15, which passed two of seven bills to reform and reauthorize the National Flood Insurance Program...
June 20, 2017

PIA National has reaffirmed its strong opposition to any legislation that would reduce the reimbursement rate for Write Your Own flood insurance carriers. PIA’s statement follows an initial markup by the House Financial Services Committee on June 15, which passed two of seven bills to reform and reauthorize the National Flood Insurance Program (NFIP).

The WYO reimbursement rate is used by carriers to pay agent commissions, and most WYOs have acknowledged that, for them to remain in the program, they intend to pass any cut to the WYO rate on to agents in the form of commission cuts, similar to what was done in healthcare.

“Our position is straightforward: As an agents’ association, PIA will not endorse a provision which will likely result in a cut to agent compensation,” said PIA National Executive Vice President & CEO Mike Becker, in a statement issued on Friday June 16. “Accordingly, PIA will continue to oppose this legislation.”

The legislation includes several provisions, like including a multi-year reauthorization, improving the claims process, and taking steps to encourage the private market to sell policies, that PIA National supports. However, PIA opposes the entirety of the legislation because of the agent compensation issue.

PIA cannot support this legislation due to the cut to the WYO reimbursement rate and the cuts to agent compensation it would engender. PIA is the only agent group to oppose the legislation over this issue. When it comes to defending PIA members’ commissions, PIA refuses to be neutral.

 

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