Commissions Module - Lesson 6: Commission Hierarchy

The Commissions Module equips participants with a practical understanding of how compensation flows across carriers, BGAs, and advisors, and why it is central to advisor retention and firm health. The course covers first-year, renewal, and trail commissions, as well as product-specific differences across life, annuities, hybrids, long-term care, and Medicare products.

Learners will explore inforce transactions that impact pay, regulatory considerations in states like New York, and how to resolve commission errors quickly to maintain trust. The module also introduces the role of technology and reporting systems in reconciling payments, managing hierarchies, and ensuring compliance. By the end, participants will be able to interpret statements, anticipate commission impacts, and support accurate, timely compensation across diverse product lines.

Lesson Overview:

Commission Hierarchy

This lesson explains commission hierarchies, how compensation flows through multiple levels, from writing advisor to BGA to IMO. It covers how hierarchies determine overrides, reporting access, and production credit. Learners will understand how hierarchies impact compensation fairness and transparency.

Learning Objectives

• Define commission hierarchy and its role in distribution.

• Recognize the levels within a hierarchy (advisor, manager, BGA, IMO).

• Explain how overrides and production credit are allocated.

• Identify how hierarchies affect reporting and bonus eligibility.

COURSE CONTRIBUTORS