The Forfeit Commission is a feature to prevent an Agent from being paid commissions from a specific Issuer. While usually all commissions from an Issuer need to be forfeited, the option does allow selecting Issuer + specific Product Types. It is strongly recommended that if commissions from an Issuer are to be withheld, you also make the Agent As Earned, or add a custom setting so that the Agent is ‘As Earned’ for that Issuer and do not have advances and resulting additions to the Agent Balance.
Forfeit Commission option in an Appointment:
To set an Agent to not be paid commissions from an Issuer, navigate the Agents Appointment record for that Issuer. Then set the status to Terminated, add an Expiration Date, and then select the Forfeit Commission option. Upon saving the changes to the Appointment, an ‘Are you sure’ message will be displayed, and by choosing to continue, the net commissions for the Issuer will be subtracted from the total net in the cycle by a Forfeit Commission Adjustment for the respective Agent.
Appointment highlighting Forfeit Commission Option when Appointment Status is Terminated:
Forfeit Commission Adjustment:
When the option for Forfeit Commission is checked in an Appointment, and the Agent has net commissions for that Issuer in a cycle, a ‘Forfeit Commission’ adjustment is created for the Net specific for that Issuer. Net from commissions for other Issuers are not affected. If there are no commissions earned by the Agent in that cycle, then a Forfeit Commission adjustment is not created.
The Forfeit Commission adjustment is created from an Adjustment Setup item that is not available to choose to manually create an adjustment or in the Commissions Adjustment import.
The Issuer is displayed in the field for Issuer in the Adjustment, as well as in a Note ‘Commission forfeited for the Issuer <Issuer name>.
If there are circumstances where not all the amount in the adjustment should be applied against the Agent, the amount applied can be manually changed in the Adjustment Allocation page.
Forfeit Commission Adjustment:
Applied Adjustment list page displaying a Forfeit Commission Adjustment:
Forfeit Commission Adjustment Setup
An Adjustment setup item ‘Forfeit Commission’ is used to create the Adjustments for this feature. Like other types of system-generated adjustment setup items, like ‘Commission On Hold’ and ‘Terminated and Not Vested,’ it cannot be used as a description when manually creating an adjustment or from an import.
Adjustment Setup list page with Forfeit Commission one highlighted:
Forfeit Commission message displayed in Summary:
When Forfeit Commission are applied to an Agent, they will have a message ‘Forfeit Commission’ displayed under the condition column in the Summary of the cycle. If the Agent had no net from the Issuer that is set to be forfeited, an adjustment will not be created, and the message will not display.
Summary page displaying Forfeit Commission in the Condition column:
Forfeit Commission adjustment displayed in Agent Statement
Agents will see the Forfeit Commission Adjustment in in the Adjustment Activity section of their pdf Statement. The note for the Adjustment will display the Issuer name. There is not a message displayed in the Summary of the Statement for Forfeit Commission like On Hold or Terminated and Not Vested.
Adjustment Activity section in the pdf Agent Statement:
Summary section in the pdf Agent Statement displaying how the Forfeit Commission adjustment is reflected in the Net and 1099 calculations:
Additional information on the Forfeit Commission process
- If the commission from the Issuer is not greater than $0.00, no Forfeit Commission Adjustment will be created.
- More than one Issuer can be set up to have commissions forfeited. Each Issuer will have their own Adjustment created for the respective net from that Issuer.
- If the Agent is also ‘On Hold,’ the Forfeit Adjustment will be created first and then the Commission On Hold Adjustment would be created with the remaining net.
- If the Agent is Terminated and not vested (so Vested is not checked in their Agent Details), then only the Terminated and Not Vested Adjustment will be created for all their net commissions.
- The Forfeit Commission can apply to both Medicare Advantage/Medicare Prescription as well as non-Medicare related commissions.
- If Policies for the Forfeit Commission Issuer are for ‘Vested Products,’ where ‘Vested’ is checked in the Commissionable Product, Product Vesting will take priority and commissions from those products will still pay to the Agent and not go into the amount of the Forfeit Commission Adjustment.
- The Agent Appointment Report has a column for Forfeit Commission with Y or N.