Compensation Disclosure

Compliance Made Simple

At OCI, we aim to set our agent partners up for success. We work closely with the National Association of Health Underwriters (NAHU) advocating for our industry in hopes of aiding in the shaping of regulations for agents.  We aim to keep you informed of the latest information regarding agent compensation disclosure.

The Consolidated Appropriations Act (CAA)

A federal law signed at the end of 2020 requiring health insurance agents and agencies to disclose their commissions to clients, in writing, in advance of a sale.

Applications & Requirements of the Law

The law requires agents to disclose commissions in writing for contracts entered into, on or after December 27, 2021, if you, the agent, reasonably expect to earn more than $1,000 in “direct compensation” and/or more than $250 in “indirect compensation” from a health plan or insurance carrier.  The requirement applies to:

  • All types of health insurance plans: ERISA Health plans, Dental plans, Vision plans, FSAs, HRAs.
  • All market plan segments: Small and Large Group plans; Fully-Insured, Level-Funded, and Self-Funded plans.

Compensation Disclosure Must Include

  • Services provided to the group by the agent.
  • All direct or indirect compensation received by health plan/carrier. Possible ways to disclose: Percentage of Premium Compensation, PEPM, Formula, Schedule, Total Annual Compensation, or “other reasonable method”.

Disclosures must be accurate and kept up to date.  Agents are required to update disclosures within 60 days after any changes in compensation that occur.