When might an agent receive a commission?

An agent typically receives a commission when a policy is sold or renewed because this is the primary way that agents earn their income. A commission is a percentage of the premium that the insurer pays to the agent as compensation for their work in marketing and facilitating the sale of the insurance policy. This process involves gathering information, explaining policy terms, and assisting clients in choosing appropriate coverage.

Renewal transactions also generate commissions since agents play a role in retaining existing clients by ensuring their policies are updated and continue to meet their needs. Thus, both the initial sale and renewal of an insurance policy are seen as opportunities for agents to earn commissions based on their effectiveness in providing these services.

The other scenarios, such as disputes over policies, claims made, or increases in premiums, do not generally relate to the earning of commissions for agents. These situations pertain more to the administrative aspects of insurance policies and claims handling rather than the sales process.