STANDARD COMMISSIONS: Calculated as a percentage of the premium charged by the insurer, usually negotiated between the agent or broker and insurer. Standard commissions generally fall in the range of 10% to 15% for most property/casualty lines, with workers compensation commissions more in the 3% to 5% range. Premiums on fee-based policies exclude commissions.

CONTINGENT COMMISSIONS: Additional compensation paid retrospectively by insurers based on the volume and/or profitability of business placed by the agent or broker. Not all lines of insurance are eligible for contingent commissions; national accounts and large loss-sensitive casualty programs, for example, are generally excluded from contingent calculations.

SUPPLEMENTAL COMMISSIONS: Introduced in 2007 by some insurers as a replacement for contingent commissions, supplements are paid prospectively based on the volume and profitability of business placed in the prior year. For example, the percentage of supplemental commissions to be paid for 2010 results, received in early 2011, would be based on 2009 performance.

ENHANCED COMMISSIONS: Introduced by Marsh Inc. in 2007, enhanced commissions are fixed fees paid by insurers based on specific services provided by Marsh. The extra fees are fixed in advance of the insurance transaction; are not contingent on volume, retention, growth or profitability; and are disclosed to clients.

FEES: Compensation for brokerage services negotiated between brokers and clients.

OVERRIDES: Typically negotiated on an individual basis between an insurer and producer, overrides are generally calculated as a fixed percentage of premium—generally in the 1% to 3% range—based on the producer's production performance for a specific line of coverage.