CRA acts as an independent insurance agency in placing personal, commercial and benefits related insurance coverages for its retail clients with a variety of insurance carriers. Primarily our compensation is derived from commissions paid by these carriers based on a fixed percentage of the premiums paid on customers' policies. In a few cases where insurance is placed with a carrier that does not pay commissions, CRA must charge a fee for its services. Whenever a fee is charged to an insured, the fee is detailed in a service agreement which the customer signs acknowledging the fee amount and the related services being provided.
In addition, we may earn income from "contingency agreements", or profit-sharing agreements that allow for the payment of additional compensation based on the underwriting profitability and volume of our overall book of business with an insurance company. These payments are not guaranteed; and since they are based on the results of CRA’s total book of business with a company, we cannot determine what the result may be until after the close of the year. Further, since these payments are made on the basis of CRA’s entire book of business, we cannot determine what impact a specific policy may have on those results.
It is important to note that these agreements are filed with and approved by state insurance departments as part of a company's rates and are not charged in addition to their rates. Finally, since most (if not all) insurance companies have these types of agreements in place, the presence of such an agreement with a particular carrier has no influence on which carrier CRA may recommend for any insured. The placement of an client's coverage is made on the basis of whether the coverage procured is suitable for the risk and the cost of the coverage is competitive.