Commissions are calculated on paid or written premium. Commissions for the prior month are processed on the first on each month. For example, on January 1, December commissions will generate against December transactions.

Preliminary Work

  1. Ensure agent, agency, and agency group contacts are entered and complete
  2. Ensure commission structures are built and assigned correctly to agencies
  3. Ensure any applicable line items that should be excluded from commissions have been set up correctly in the Lines module

Core Concepts

Pay Commissions On

Commissions can be calculated on written or paid premium.

When configuring a line item, identify whether that item receives commissions using the No commission is paid on this line item setting.

When Commissions Are Calculated

Across All Policies

Commissions are calculated on the 1st of each month for the prior month.

Examples

  • On February 1st, January commissions are calculated
  • On March 1st, February commissions are calculated

For a Given Policy

Commissions are calculated once a policy is issued (committed) and effective.

  • A new business policy has a down payment on 6/25
  • The policy is issued on 7/1 and effective 7/5
  • Commissions will be paid on August 1st for July because the policy was not issued and effective until July

Written Premium Example

  • A policy is issued on 8/1
  • The policy is effective 9/1
  • Commissions will be paid on October 1st for September because the policy was effective in September

Who Gets Paid

Whichever agent or agency is on the policy at the end of the month is the agent or agency who receives commissions for that month, whether positive or negative.

Commissionable Amount

The amount against which the commission rate is applied.

  • The site is configured to pay commissions on paid premium only
  • An agency receives a 15% commission rate
  • A bill is issued for $100 in premium and $5 in fees
  • The Commissionable Amount is $100
  • The Commissions are $15, or 15% of the $100 Commissionable Amount

Written Premium Example

  • The site is configured to pay commissions on written premium only
  • An agency receives a 15% commission rate
  • A policy is written for $850
  • The Commissionable Amount is $850
  • The Commissions are $127.50, or 15% of the $850 Commissionable Amount

Negative Commissions

When the sum of all monthly transactions for an agency net to less than $0.

Agency 1

Policy Transaction Commissionable Amount
10-2017-1 Payment Received $500
10-2017-2 Payment NSFed -$700
10-2017-3 Return Premium -$50
Total Commission for the Month -$250

Written Premium Example

Agency 1

Policy Transaction Commissionable Amount
10-2017-1 Policy Issued $1,200
10-2017-2 Policy canceled mid-term -$700
10-2017-3 Policy canceled flat -$1,500
Total Commission for the Month -$1,000

BriteCore Setup

Settings

Settings > Modules > Contacts

For Agencies Belonging to Agency Groups, Pay Commission To

If Agency Groups are used, identify whether commissions are to be paid to the group or the individual agencies of the group.

Pay commission Based On

Define whether to pay commissions on paid or written premium. Given the implications of changing this setting, please contact IWS to update this setting in the database.

#UPDATE settings SET value='paid or written' WHERE option='paycommissionon'

Roll Over Negative Commission Balances Each Month (Delay Negative Commission)

Negative commissions each month may be billed or carried (rolled) over to the next month.

Bill Negative Commissions
Some clients prefer commissions start from $0 each month. When the above setting is unchecked, BriteCore will process as if the agency will pay you the negative amount owed. The next month's commissions for that agency will then start at $0. The commissions for the month will match the monthly activity as illustrated in the below table.

Agency 1

January February March April
Net activity for the month $5,000 -$1,000 -$3,000 $500
Commissions paid for the month $5,000 -$1,000 -$3,000 $500

Roll Over Negative Commissions
When the above setting is checked, BriteCore assumes the agency will not pay the negative commission and will roll over the negative amount to the next month. The next month's commissions for that agency will then start at the negative amount from the previous month. Commissions will not be paid until the net balance is positive.

As illustrated in the table below, the agency had a negative commission balance in February. In March, though, the net activity was positive so the commission paid was the March activity of $3,000 less February's activity of -$1,000 for a total commission paid of $2,000.

Agency 1

January February March April
Net activity for the month $500 -$1,000 $3,000 $500
Commissions paid for the month $500 $0 $2,000 $500

Commission Structure

Define the commission rate(s) for agencies. You can create as many structures as needed. Some carriers have one structure for all agencies whereas others have multiple structures for their agency force. See the Setup Commission Structures how-to.

A single commission structure for your agency force will be easiest to manage.

When Printing

For commission reports, select to Print Agent by Agent Detail or Print Summary Without Agent Detail.

For the best experience, attach agencies should be attached policies. With this setup, BriteCore is unaware which agent writes a policy, making the Print Agent by Agent Detail option unnecessary.

Settings > System Wide > Administrative Alerts > Processing

Payments

Payments emails for commissions fall into the below categories.

Negative Commissions
Recipient(s) receive an email like the below when commissions are negative for an agency regardless of the Roll over negative commission... setting above. The Commission Payments Delayed: Review ASAP email will show all negative payments (neg_amt) for the month broken down by agency and policy number.

Commission Calculation Issues
Recipient(s) receive an email like one of the below when BriteCore detects an issue that will lead to commission calculation issues at month-end. When this occurs, typically you will need to submit a ticket to IWS.

Commission Calculation Issues: Policy Term(s) Missing Revision(s)
The following policy/effective date combinations appear to be missing at least one key revision (probably the effective/renewal revision).

Commission processing will skip all policy terms listed below unless the issues are corrected before the end of the month:
Policy: 10-2016-1 --> Term: 2016-1-1 - 2017-1-1

Traceback (most recent call last):
[code]

Commission Calculation Issues: Agents Missing Agencies!
Please address the following issues as soon as possible by adding agencies to each agent!

When making these updates, you should also verify that all other agents on a given policy's history belong to agencies as well.

Also, please note that the policies listed below may not be an exhaustive list of those a given agent is associated with. Rather, the policies listed are thosethat will experience issues when commissions are next calculated.

[agent name] does not have an agency assigned! The following policies associated with this agent will fail to calculate commissions until this issue is addressed:
10-2016-1
10-2016-2


BriteCore Processing

Workflow

Click on the image below to open in a new window. Access the raw file here.

Email

Agents who receive electronic notifications will receive an email like the below when sent from Policies > Payments > Pending Commission Payments > Agent Commission Reports. The agency's commission report will be attached to the email as a PDF.

BriteCore: Monthly Commission Report for [insurance agency name]
Attached to this message is the monthly commission report for [insurance agency name].

This is an automated message sent by the BriteCore system. If you have received this message in error, please disregard this email.


How-Tos

Setup Commission Structures
Issue Negative Commission Statements
Enter Manual Adjustments
Pay Monthly Commissions Electronically
Pay Contingent Commissions Electronically

Setup Commission Structures

Setup a Point Forward Commission Structure

  1. Navigate to Settings > Modules > Contacts > Commission Structures
  2. Click + to add a new Structure Start Date. By default, this date is referenced by a policy's effective date. For example, a 7/1 Structure Start Date means any policies effective on or after 7/1 will receive commission rate as defined in the structure
  3. Enter a date after your first lines effective date but prior to your first policy effective date in BriteCore. For example, if your first lines effective date is 12/1 and your first policy effective date is 1/1 then enter a commission start date of 12/15
  4. Select the Structure Start Date from the dropdown list
  5. Click + to add a new New Commission Structure
  6. Click Done
  7. Click the pencil to navigate to Commission Structure Setup
  8. Name the commission structure as descriptively as needed, for example, Standard Agency Commission Rate
  9. Add at least one tier. Each tier allows you to set a different commission rate based upon renewal dates or premium
    • If the commission rate is the same for each state, policy type, and new/renewal policy, do not check the box. To differentiate the rate among those criteria, check the applicable box. For example, to provide a different rate for new and renewal business, select the applicable box and define the rate for each within the table
    • Renewal Date Before allows you to define a rate for policies prior to a given renewal date. For example, policies renewing prior to 7/1/17 receive a 10% rate whereas all other policies receive a 12% rate
    • For Premium Greater Than allows you to define a commission rate based upon a policy's premium

Setup a Commission Structure for Legacy Policies

A setting exists for carriers who offer different commission rates for legacy business. For example, if an agency acquires an older book of business, a lower commission rate can be paid on policies with an older inception date and a higher rate on new policies written at a later date by that agency. To set up different comission rates for legacy business, complete the following steps:

  1. Navigate to Settings > Modules > Contacts > Commission Structures
  2. Click + to add a new Structure Start Date
  3. Enter 01/01/1901
  4. Click Done
  5. Click the pencil to enter the Commission Structure Setup
  6. Name the commission structure as descriptively as needed, for example, Legacy Agency Commission Rate
  7. Check the Trigger off Policy Inception Date instead of Term Effective Date box
  8. Complete the remainder of the setup as detailed above

Issue Negative Commission Statements

Negative commission statements are needed only if you do not roll over negative commissions:

  1. Navigate to Reports > Reports List > View Old Report List
  2. Locate the Retrieve Negative Commission Reports report
  3. Click on the report name
  4. Check the desired agency(ies)
  5. Either download or email the report. If emailed, the report will go to the agency's email address

No Results indicates there are no negative commissions for the month.

Enter Manual Adjustments

Manual adjustments are for entering a payment received from an agency against a negative balance:

  1. Navigate to Policies > Payments > Pending Commission Payments
  2. Process your commission payments for the month
  3. Navigate to Manual Commission Adjustments
  4. Select the agency
  5. View the policies awaiting action due to the net negative commission amount
  6. Enter the adjustment amount against policy(ies) with a negative balance. You can distribute funds as needed

The tables below mimic the table you see in BriteCore. The before table displays what you will see prior to entering adjustments; the after table what you will see after entering adjustments.

In the example, Agency 1 has a balance of -$111.35. The Negative Commission Report sent to the agency reflects that amount. Once the agency remits the $111.35 payment, distribute the funds in the Commission Adjustment column across the three policies with a negative balance. Enter the amounts as positive numbers to offset the negative amount due.

Agency 1 - Before

Policy # Commissionable Amount Commission Amount Commission Adjustment
10-2017-1 -796.00 -95.52 0.00
10-2017-2 -179.60 -21.55 0.00
10-2017-3 1,032.80 123.94 0.00
10-2017-4 -985.20 -118.22 0.00
-928 -111.35 0

Agency 1 - After

Policy # Commissionable Amount Commission Amount Commission Adjustment
10-2017-1 -796.00 -95.52 95.52
10-2017-2 -179.60 -21.55 21.55
10-2017-3 1,032.80 123.94 0.00
10-2017-4 -985.20 -118.22 118.22
-928 -111.35 111.35

Pay Monthly Commissions Electronically

  1. Use the Primoris payment vendor
  2. Complete the BriteCore setup
  3. On the first business day of each month, navigate to Policies > Payments > Pending Commission Payments > Commission Payment Queue
  4. The ACH radio button will be selected
  5. The agency commissions will appear in the table
  6. Click Process Commission Payments

Timeline

  • Day 1 The above steps are completed
  • Day 2 Primoris debits your commission account
  • Day 3 Primoris processes credits to agency accounts
  • Day 4 Funds are credited to agency accounts

Pay Contingent Commissions Electronically

Setup

  1. Use the Primoris payment vendor
  2. Ensure each agency has an Agency Number on its contact in the Contacts module
  3. Navigate to Policies > Payments > Pending Commission Payments
  4. Click Upload CSV
  5. Click Download Sample Template
  6. Overwrite the template with your data

Processing

  1. Navigate to Policies > Payments > Pending Commission Payments
  2. Click Upload CSV
  3. Click Choose File
  4. Upload the file
  5. Click Process Commission Payments

FAQs

What affects paid premium commission calculations?
A payment, NSF, and a return premium (whether issued or transferred to a new policy) affects paid premium commission calculations.

For commissions on paid premium, what happens if I delete a payment that has already had commissions paid against it?
Commissions will be recalculated back to the beginning of the term.

Once agent commission statements are emailed, can I resend them?
Yes, go to Reports > Report List > Agency > Retrieve Commission Reports and enter the applicable information. You can either download or re-email the chosen reports. You may need to access the report from the old report screen, which is accessed via View Old Report List.

If a commission structure is not assigned to a contact but is then added after a month-end processing, how do I pay commissions?
Paid premium

  1. Update the commission rate on the agency in the Contacts module
  2. Submit an OOPS! ticket to IWS
  3. Run the recalculate tool in commission section of ./bin/britecore_shell.py

Written premium

  1. Update the commission rate on the agency in the Contacts module
  2. Submit an OOPS! ticket to IWS
  3. Run the insert_manual_adjustment tool in commission section of ./bin/britecore_shell.py to insert a manual adjustment

Do this only if the commission should have been paid in the past.

On the PDF commission report sent to agents, what does the YTD column reflect on the last page?
The YTD amount is the YTD amount for the policies paid in that month rather than the YTD amount for the agency as a whole.


More Information

Commission Reports PDFs

The reports accessed from Reports > View Old Report List > Retrieve Commission Reports simply retrieve the stored reports. If a data change occurred that requires the reports to be updated, run the rerun_pdf_reports in the commissions section of the BriteCore shell. Once rerun, access the reports from Reports > Retrieve Commission Reports.

Commissions Processing and the Database

There are two primary tables that are directly modified during the calculation process:

  • commission_accounting contains detailed calculations per term and agent/agency
  • commission_payments contains calculations from commission_accounting that are aggregated into a payment per payee based on upon whether commissions are paid to agencies or agency groups
    Commission payments are never issued to agents
    • The commission_payments table populates Policies > Payments > Pending Commission Payments
    • BriteCore's paid premium commission code works based on a balancing equation between account_history and commission_accounting. Although calculation only occurs once a month, it could safely write every day
    • When the calculation step (commission_accounting) is complete, the detailed records are immediately aggregated and exported to the commission_payments table (or, depending on the negative commission setting, delayed if the net amount is negative). As an audit, the following query should never return any results
      SELECT *
      FROM commission_accounting
      WHERE delayed = 'not_delayed' AND exportDate IS NULL;
  • Once written, commission_accounting and commission_payment records are effectively immutable

Dates

It is important to understand the date columns in commission_accounting:

  • transactionDateTime shows the end of some month and is reflective of the logical date of the calculation. Values will repeat if recalculation occurs
  • exportDate is always the last second of the last day of the month based upon the provided processing date
  • dateAdded is the actual date the record was added to the table

Shell tools

Preview_Commission

  • Allows examination of what will be calculated for a desired month
  • Allows recalculation to be simulated
  • Useful for determining if an action has fixed a problem or if recalculation alone will

Force_Term_Recalculation

  • Sets a flag in the policy_terms table, which causes recalculation to occur regardless of other triggers
  • Use preview commission command prior to this command

Rerun_PDF_Reports

Rerun both standard and negative commission reports.

Recalculation

  • Allows retroactive (after month has passed and records are written to table) recalculation of a single policy term at a time
  • Can only be used for paid premium
  • Cannot use if the payment being modified is being exported and reviewed by the client
  • Usable up until the 17th day of the month

Insert_Manual_Adjustment

  • Allows an adjustment of any amount to be entered against any policy term
  • Manual adjustments are outside the calculation process
  • Use only as a permanent fix for persistent problems

Feedback

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