Ohio Announces Insurance Agent Fee Reduction
July 1, 2014 by Targeted News Service
COLUMBUS, Ohio, June 30 –The Ohio Department of Insurance issued the following news release:
A reduction in the fee insurance companies pay to “appoint” insurance agents is expected to result in $11.3 million in reduced annual costs, Lieutenant Governor and Department of Insurance Director Mary Taylor said.
“Lowering the cost of doing business in Ohio benefits consumers and further strengthens Ohio’s vibrant insurance market,” Taylor said. “The Ohio Department of Insurance is committed to a common sense regulatory environment that makes it easier to do business, create jobs and protect consumers.”
An amended rule took effect in Ohio on June 30 that reduces the agent appointment fee 25 percent from $20 to $15. Insurers must “appoint” agents before those agents can act on their behalf to sell, solicit or negotiate insurance products. The Department has increased operational efficiencies by updating its technology systems, thereby reducing the resources needed to effectively monitor company and agent appointments.
The reduction is the latest common sense agent fee measure taken by the Department. A$5 appointment termination fee was eliminated in 2013, while those who renew licenses late now pay $50 instead of $100. The license reinstatement fee was also dropped from $300 to $100.
Insurers will see direct costs savings because they mostly pay the agent appointment fee. However, agents and agencies will also benefit because the fee can be passed onto them by the insurance companies. Consumers may also benefit from the fee reduction as administrative costs such as appointment fees are built into the premiums consumers pay.
Ohioans with insurance questions can call the Department’s consumer hotline at 1-800-686-1526. Insurance information is available at www.insurance.ohio.gov and you can follow the Department on Facebook and Twitter.
