Broker Commission Management
In insurance, the remuneration of intermediaries is a perpetual headache. Between brokers, general agents, mandatories, introducers of business and their own sub-networks, each contract taken out triggers a cascade of commissions with different rates depending on the product, the length of the relationship, objectives achieved, and endorsements during the year.
The accounting teams juggle with commission agreements that have been accumulating for years: some signed a very long time ago, never properly formalised in the IT system. Each month, it is the same ritual: reconciling premium collections with contracts, identifying settled due dates, applying the correct rates, managing reminders and regularisations, producing compliant schedules.
All this under pressure from intermediaries who dispute their statements, and from the finance directorate which wants accurate provisions. Not to mention ACPR controls which require complete traceability of remuneration flows paid to the network.
This solution belongs to the Billing, Quoting & Configurators family.
Challenges holding back your performance
The spreadsheet remains the predominant tool across many commercial and accounting departments. Enormous files, maintained by one or two individuals who know the formulae by heart. When they leave, panic ensues. General-purpose ERPs can handle simple commissions: a fixed percentage on a sale; however, they cannot manage insurance-specific requirements: cascading commission structures across multiple levels, adjustments on prior years, variable rates according to collection thresholds, management of portfolio transfers between intermediaries.The result: hours of manual reprocessing, costly errors leading to disputes with the network, and an inability to respond promptly when a broker requests a detailed breakdown of their remuneration over recent years.
Our Technical Approach
Our approach stems from a straightforward observation: the problem is not technical, it is structural. Commission rules are dispersed: in paper agreements, emails, managers’ minds, hidden spreadsheet cells. Before coding anything, we reconstruct with your teams the complete repository of remuneration rules.
Who receives what, on which perimeter, according to which conditions. Once this work is completed, we configure a calculation engine capable of applying these rules to your actual cash flow receipts. The cascade allocation: from wholesale broker through to sub-agent: is native. Reconciliation with receipts is automatic: only premiums actually settled trigger commissions.
Statements are generated in the format expected by each intermediary, with the contractual level of detail. All with complete traceability to justify every euro paid.
Automated cascade breakdown
Reconciliation with collections
Editing commission schedules
Technical Architecture
Select options, apply pricing rules, produce the document: Product Configurator & Quoting and Monetisation & Subscriptions rest on this sequence.
- Automated cascade breakdown
- Reconciliation with collections
- Editing commission schedules
Smooth and frictionless integration
We work with your existing systems: whether it’s a market insurance software package, an in-house legacy system, or a combination of both. The commission calculation tool is fed by automated flows from your contract database and your collections accounting. No re-entry, no forced migration. Existing commission agreements are modelled progressively, starting with the highest-volume ones.
Your teams retain their reference points, and the existing IT system continues to operate.
Mapping of Rules
Comprehensive inventory of agreements, identification of special cases and undocumented rules with your account managers.
Modelling and configuration
Translation of business rules into calculation engine parameters. Validation on real cases from your historical records.
Connection to data
Connection to contract and collection flows. Consistency testing with your current calculations over several periods.
Implementation and handover
Deployment to production on an initial scope. Training of teams, documentation of procedures, support for the first closing.
Measurable results for your organisation
- Monthly statements produced by the engine from the contract and collection flows
- Commission calculation applied by configured rules, not by spreadsheet formulae
- A dispute with an intermediary settled on a traced line of calculation
- A detailed justification request served from the engine, item by item
- Commission provisions calculated on the same rules as the payments
- Complete traceability of payments for regulatory controls
Clarifying your decision-making
Our commission agreements are highly specific and have evolved over the years. Can your tool truly handle all of them?
Clarendis has modelled agreements with rates varying by seniority, crossed product and volume thresholds, multi-level cascades, and clawback rules over several financial years. A rule that can be formulated can be configured. An audit of your most complex agreements validates feasibility before any commitment.
How long before we have an initial actionable result?
The first commission scope put into production is usually one network or product family, and its timeframe is quoted against your scope before we start. That includes modelling the rules, connecting to the data and validating with your teams. Extension to the remainder follows in successive waves.