Question

What does the term "overriding commission" typically refer to in reinsurance?

a.

Incremental commission paid on retrocession

b.

Compensation for premium volume produced by other agents

c.

Compensation for premium volume produced by the same agent

d.

Additional fee charged by brokers for placement services

Posted under IC85 Reinsurance Management

Answer: (b).Compensation for premium volume produced by other agents Explanation:Overriding commission is typically paid to compensate an existing agent for the premium volume produced by other agents in a given geographic territory. It rewards the agent for generating business from other sources.

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Q. What does the term "overriding commission" typically refer to in reinsurance?
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