Do You Invoice Clients for Clawbacks?

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Are there any circumstances under which you would consider charging your client a fee to cover commission clawbacks due to early policy cancellation?

  • Yes (51%)
  • No (43%)
  • Not sure (6%)

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When clients do the unexpected and cancel a policy, the thorny issue of the clawback quickly surfaces.

As an adviser, do you take it in on the chin, try to win the business back, or send an invoice to cover the time and effort in advising on the cancelled policy and setting it up?

In Australia, advisers sometimes include clawback clauses in their contracts due to the restricted commission environment under which they operate.

Here, the FMA advises consumers to ask if there is a charge for cancelling a policy within a specified period, warning that some advisers may ask them to pay the clawback charge.

Do you prefer not to alienate a client by invoicing them for a clawback? Or are there sometimes circumstances in which you consider that you’ve provided a service and should be remunerated for it, even though the client has cancelled the policy inside the responsibility period?

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