How the commission of agent is calculated?

[policy]

1- How the commission of the agent is calculated?
2- Is it - Premium * X%? Or some other method.

Where X = commission

Similar Threads:

• commission for an agent in general insurance business
• What is the Development Officer Commission & Agent Benefit?
• Life Time Super Pension policy - How to get policy bonus and agent commission and what is its procedure?
• How much commission LIC agent gets of the premium?
• Discount in premium in lieu of agent commission?

[abhijeet06]

Its % of the premium paid. I.e. if paid premium of Rs. 5000 and the commission rate is 10%, than commission paid to agent is
= 5000 * 10/100
= 500

Note - I have not taken VAT or any other tax amount in it.

[PolicyWala]

1- How the commission of the agent is calculated?
2- Is it - Premium * X%? Or some other method.
Where X = commission

Commission can be calculated by two ways -
1- Gross Rate = Premium X (Rate/100)
2- Net Rate = [(100 X Premium) / (100 - Rate)] - (Premium)

[Master]

Abhijeet - You have missed "service tax" part. Service tax is added in the last in premium, so we need to deduct that to calculate the agency commission.