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When you buy insurance, you trust your agent to guide you toward the coverage that best protects you, your family, or your business. But what if the recommendation you receive isn’t entirely about you? What if it’s influenced by behind-the-scenes perks offered by insurance carriers?
Unfortunately, this happens more often than you might think. Some carriers offer incentives such as bonuses, rewards, or trips, to encourage agencies to place more policies with them. While some agencies take advantage of these offers, we’ve made the decision not to. We believe it’s not only unethical for agencies to accept incentives, but also for carriers to even offer them.
In this article we’ll discuss why we believe carrier incentives are not in the clients’ best interests, what we think carriers should be doing instead of offering these incentives, and how to know you are working with an ethical agency.
What are carrier incentives?
Carrier incentives are rewards that insurance companies sometimes offer to agencies or agents in exchange for placing business with them. These can take many forms, such as:
- Cash bonuses for meeting sales goals or hitting certain premium thresholds
- Free trips or vacations for placing a high volume of business
- Perks like tickets to sporting events or luxury gifts
On the surface, these rewards might sound harmless – after all, lots of industries use incentives to motivate sales. But in insurance, they create a unique ethical challenge. Unlike retail or travel points, the “product” isn’t a t-shirt or a plane ticket, it’s financial protection for your home, car, or business.
That means the stakes are much higher. If an agency allows incentives to influence which carrier they recommend, you could end up with coverage that benefits the agency more than it benefits you.
Why it’s unethical for agencies to accept incentives
The relationship between an insurance agent and a client is built on trust. Clients depend on agents to guide them toward the best coverage at the best value with a carrier that will support them when it matters most.
If an agent is motivated by an incentive, however, their recommendation may not be about the client at all – it may be about what benefits the agency. That creates a conflict of interest as the agent’s goals may no longer align with the client’s goals.
And the client will most likely never even know about it. They could end up with a policy that’s more expensive, provides less coverage, or comes from a carrier that doesn’t perform well on claims.
That’s why we’ve taken a firm stance: we don’t accept carrier incentives.
Here’s what guides us instead:
- Coverage quality: Does this policy fully protect the client’s needs?
- Carrier reliability: How well does the company handle claims and service?
- Client fit: Is this truly the best match for the individual, family, or business?
By focusing only on these factors, we can say with confidence that our recommendations are 100% about the client, not about us or what perks a carrier dangles in front of us.
Why it’s unethical for carriers to offer incentives
While agencies must take responsibility for their choices, we also believe the problem starts with the carriers.
Think about it: insurance premiums are climbing across the board. Clients are paying more for home, auto, and business insurance than they ever have. Shouldn’t carriers be using their resources to stabilize rates and ease the burden on policyholders?
Instead, some are using those dollars to fund vacations, bonuses, and perks for agencies. In our opinion, that’s not only wasteful – it’s corrupt. It prioritizes sales tactics over client value, and it undermines the trust that policyholders place in the industry as a whole.
Instead we believe carriers should focus on:
- Investing in risk management and loss prevention to help keep premiums down
- Improving claims service so clients get the support they deserve
- Offering competitive, sustainable rates to win business the right way
In other words: compete on value, not perks.
What you can do to make sure you’re working with an ethical agent:
As a consumer, you may not always know what happens behind the scenes at an insurance agency, but there are steps you can take to make sure you’re working with someone who has your best interests in mind.
Here are a few things you can do:
- Ask directly about incentives. Don’t be afraid to ask your agent: “Do you accept incentives from carriers?” A trustworthy agency will be transparent with you.
- Pay attention to the explanation. Does your agent explain why they recommend a certain carrier for their coverage strength, claims reputation, long-term value, or do they gloss over the details?
- Do some homework. Research the carriers you’re being offered. If the agency pushes one carrier exclusively, it might be worth asking why.
- Trust your gut. If something feels off like you’re being “sold” instead of being advised, listen to that instinct.
The truth is, you shouldn’t have to wonder whether your agent is working for you or for a perk. But by asking the right questions and staying aware, you can protect yourself from being steered into a policy that benefits the agency more than it benefits you.
To learn more about selecting the right agency, check out this article: What to Look For when Selecting an Insurance Agency or Company
Time to rethink industry norms
We know we can’t change the entire industry overnight. Incentives have been around for a long time, and many agencies and carriers consider them the norm. But just because something is common doesn’t mean it’s right.
We believe it’s time for both agencies and carriers to rethink this practice. Agencies should say no to incentives to preserve their integrity and carriers should stop offering them and put their resources toward lowering premiums and improving service.
That’s how we rebuild trust in the industry – by putting clients, not perks, at the center of every decision. If you want to be extra sure you’re working with an agency that puts you first, download our guide below.
