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Compensation

Who gets paid when you refer a client.

When a policy is placed, the insurance carrier pays Aligned Path Insurance Solutions a standard commission out of the premium the client pays. The referring advisor earns no insurance commission. Neither the advisor's firm nor the client pays Aligned Path a separate fee for shopping, placing, or servicing the coverage.

Advisors ask because the answer is usually vague, and it should not have to be.

The money, in the order it moves.

  1. 01

    You introduce the client

    Your firm invoices nothing and receives nothing for the introduction. There is no referral fee in either direction and no revenue sharing arrangement to disclose.

  2. 02

    We shop the market and make a recommendation

    Quoting, underwriting coordination, and delivery happen at no charge to you or the client, whether or not anything is ever placed.

  3. 03

    The client decides, including deciding against coverage

    If the existing policy is adequate, that is the recommendation. Nothing is billed for the review that ends there.

  4. 04

    If a policy is placed, the carrier pays us

    The commission comes out of the premium the client pays the insurer. It is not added on top, and it does not appear as a line item on anything you send your client.

No separate fee for our help.

Aligned Path does not charge the client a separate fee for shopping, placing, or servicing coverage. When a policy is placed, the carrier pays us a commission. That compensation is part of the carrier’s pricing arrangement; we do not add a brokerage surcharge.

When comparing a brokered quote with a direct quote, check the product, benefits, term, riders, underwriting class, payment schedule, and state. A carrier may offer different products through different channels. We can help compare the actual quotes rather than assume they provide the same coverage at the same price.

How compensation affects the work.

The referring advisor earns no insurance commission and pays no referral fee. The advisor’s compensation from this arrangement does not change with whether the client buys, which product they choose, or the size of the policy. That separates the advisor’s planning compensation from our carrier compensation. It does not establish that every conflict is absent.

Aligned Path is paid by carriers, and commissions vary by carrier and product. A permanent policy generally pays more than a term policy with the same face amount, and a larger policy generally pays more than a smaller one. Those differences create an incentive that should be visible when a recommendation is reviewed.

We explain the coverage, cost, and tradeoffs behind a recommendation. Existing coverage is part of that comparison, and keeping it can be the right outcome. The carriers we will and will not place business through are published rather than described, and the advisor sees the recommendation the client sees. If compensation matters to a specific case, ask us for the amount and how it is paid.

Commission is shaped differently by line.

Life, disability, and long-term care commissions are typically front-loaded. Most of the compensation arrives in the first policy year, with smaller renewal amounts in the years after. That shape is why replacement deserves scrutiny: moving a client from one policy to a similar one restarts first-year compensation, which is exactly the transaction that should have to justify itself.

Home, auto, umbrella, and commercial lines usually work as a percentage of premium paid in every year the policy renews, so the incentive is flatter and points toward keeping a client well serviced rather than toward writing something new. Annuity compensation varies widely enough by product type that it is worth asking about case by case.

Exact schedules differ by carrier, product, and state, and they change. If a specific case turns on the number, ask and we will give you the number for that case.

Questions compliance asks first.

Who gets paid when a fee-only advisor refers a client for insurance?
The insurance carrier pays Aligned Path a standard commission, and only if a policy is actually placed. The referring advisor earns no insurance commission. Aligned Path charges neither the advisor's firm nor the client a separate fee for shopping, placing, or servicing any line of coverage, including commercial insurance.
Is there ever a fee to the client?
No. Neither the advisor nor the client pays Aligned Path anything. The only money in the arrangement is the carrier's commission, paid when a policy is placed.
Does the advisor's firm pay Aligned Path anything?
No. There is no engagement fee, retainer, platform fee, or per-case charge. An advisor can send a case that goes nowhere and owe nothing.
Does buying through a broker cost the client more?
Aligned Path adds no separate shopping, placement, or servicing fee. To compare a brokered quote with a direct quote, compare the actual product and policy terms, underwriting class, riders, payment schedule, and state. Different products or underwriting offers can produce different premiums.
Does referring the case out remove every conflict of interest?
No. The referring advisor earns no insurance commission and pays no referral fee. Aligned Path receives carrier commissions that vary by product and carrier, so our incentives still need to be considered. We explain the recommendation and can disclose compensation for a specific case.
What happens if the client should not buy anything?
The review ends with that recommendation and no one is billed. Keeping existing coverage is a normal outcome, and an advisor who never sees that outcome from a brokerage should treat it as a warning sign.

Anything here your compliance team would want in writing?

Ask and you will have it in an email you can forward, usually the same business day.

Talk with usHow referrals work