HRH announces contingent commissions change
Business Insurance Daily News
by Mark A. Hofmann
Posted on Feb. 24, 2005
GLEN ALLEN, Va.—Hilb Rogal & Hobbs Co. will stop accepting volume based contingent commissions but will continue to take profit-based contingent commissions from insurers, the brokerage announced.
In a statement announcing its financial results for 2004, the Glen Allen, Va.-based brokerage said it received $42.4 million in contingent and override commissions in 2004, which represents 6.8% of its revenues.
Of that, 81% of the contingent commissions were derived from commissions that are based mainly on claims experience and are maintained by local offices. The rest was derived from volume-based national override agreements, HRH said.
"Effective for business written on or after Jan. 1, 2005, these national override agreements, which were paid quarterly when earned, reverted into industry standard contingency agreements, which will be paid and recorded annually beginning in early 2006," HRH said.
Meanwhile, the brokerage reported revenues of $619.6 million in 2004, a 9.9% increase over the previous year. HRH reported profits $81.4 million for 2004, an 8.7% increase.