Compensation Changes for Medicare Supplements in 2014

• Increased commission rates to writing producer in years 1-6: 4%, (or state special equivalent). States AK, CT, DC, FL, HI, NY, RI, VT are excluded.
• Affiliate Replacement commission rates increased from 75% to 90%. States CA, CT, ME, MN, MO, OR, WA are excluded.
• Mix of business bonus on renewal compensation to writing producer, see details below.

Note: The CA Mutual Medicare Supplement filing is still pending approval.

Always refer to your compensation schedule for specific detail. These will be available on SPA December 20.

Mix of Business Bonus on Renewal Compensation - Here is how it works:

1.   All policies written during a given quarter will receive increased levelized commissions in policy years 2-6 (or state special equivalent) if they meet (in total by policy count) target levels of 40% or 50% underwritten.

2.   A 40% mix would qualify for a 2% bonus, 50% for a 4% bonus (or state special equivalent).

3.   The bonus is applied only in renewal years and does not affect the first year commissions paid.

4.   Qualification starts over at the beginning of the next quarter, there is no minimum policy count to qualify.

5.   Special agent producers will qualify and earn bonuses individually and will be rolled to their upline just like their standard compensation.

6.   Internal Conversion and Affiliate Conversion policies will be counted as Underwritten for qualification, but will not receive the bonus.

7.   Quarterly statements and reports on SPA will be available to help producers track their progress.

8.   The following states are excluded from the program: AR, CA, CT, MO, ME, MA, MN, ND, NY, OR, VT, WA, WV, FL.