louisiana article

Oct 8, 2012


On October 4, 2012, Louisiana Insurance Commissioner James Donelon issued Advisory Letter No. 2012-03 to insurers, brokers and producers regarding producer compensation issues.

Issues described in earlier Advisory Letter No. 2012-01 from Commissioner Donelon relating to producer compensation agreements and “net of commission” quotes were addressed by LSA-R.S. 22:1567, which “authorizes producers and certain insurers or policyholders to negotiate any combination of commissions, fees, or fees in lieu of commission for the placement of commercial property and casualty insurance, including a governmental entity. . .” for property and casualty insurance only.

Advisory Letter No. 2012-03, which is attached in PDF format, explains an exception created by LSA-R.S. 22:1567 and reiterates the Louisiana Department of Insurance’s legal opinion regarding producer compensation agreements between insurers, producers and policyholders previously explained in Advisory Letter No. 2012-01.