Group Health Broker Benchmarks
What benefits brokers actually earn on group health, in both percent-of-premium and per-employee-per-month terms, cut by group size, new versus renewal, and the 37x swing between states. The reference tables an agency uses to check whether its book is priced where the market is.
Group health broker compensation comes in two shapes. On smaller fully-insured groups, carriers build a commission into the premium, usually a percent of premium that the broker cannot change. On larger and self-funded groups, compensation shifts to a flat per-employee-per-month (PEPM) fee that the broker negotiates directly with the employer. The two structures produce very different economics as a book scales, which is why a growing agency needs to see both side by side.
One rule runs through all of it: as a group gets larger, the commission percentage falls, even as the total dollars rise. The tables below show the going rates.
Table 1: Commission by group size (percent of premium)
| Group size | % of premium | Structure | Negotiable? |
|---|---|---|---|
| Small (2–50) | 4%–7% | Built into premium by carrier | Rarely |
| Mid (51–99) | 2.5%–5% | Built in, some flexibility | Sometimes |
| Mid-large (100–499) | 2%–4% | Often shifts to PEPM or fee | Usually |
| Large (500+) | 1%–3% / fee | Negotiated fee or PEPM | Yes |
Table 2: Commission by group size (PEPM dollars)
| Group size | Disclosed PEPM | Modeled PEPM | Annual per 50 lives |
|---|---|---|---|
| Small (2–50) | $23–$27 | $18–$27 | $10,800–$16,200 |
| Mid (51–99) | ~$24 flat (some carriers) | $15–$22 | $9,000–$14,400 |
| Mid-large (100–499) | negotiated | $12–$18 | per-group negotiated |
| Large (500+) | negotiated fee | $8–$15 | flat fee common |
The two tables tell the same story from opposite ends. Percent-of-premium falls as groups grow, but because premium volume rises faster, total dollars per group still climb. The strategic read for a growing agency: small groups pay the highest rate but the least absolute dollars, so a book built only on small groups works harder per dollar than one that adds mid-market.
Table 3: New vs. renewal commission
| Year | Group health | Contrast: life | Contrast: ancillary |
|---|---|---|---|
| First year | Same as renewal (level) | 55%–120% of premium | Often graded ~10% |
| Renewal | Same rate, recurring | 2%–5% | ~10% level |
| Nature | Recurring annuity | Front-loaded | Recurring, higher rate |
This is the quiet advantage of a group health book. Because commission is level rather than front-loaded, every retained group pays the same the next year and the year after. That recurring quality is exactly what makes a benefits book valuable at sale, covered in our valuation benchmark.
Table 4: Commission by state (the geographic spread)
| State (example) | Per-member commission | Read |
|---|---|---|
| Minnesota (high) | $305.28 | Top of the national range |
| Virginia (low) | $8.16 | Bottom of the national range |
| High-to-low spread | ~37x | Same product, same work, different state |
This is the most under-appreciated number in broker economics. A 37x swing on the same product means the single biggest lever on per-member commission may be which states your carriers and appointments cover, not how you sell. A remote-capable agency licensed in high-commission states earns multiples of one confined to a low-commission one. State-by-state figures are tracked publicly by KFF.
What moves a broker’s commission
Group size. The single biggest factor. Percentage falls as lives rise; structure shifts from carrier-set percent to negotiated PEPM or fee.
Funding type. Fully-insured carries a built-in commission. Self-funded and level-funded typically move to a PEPM consulting fee, covered in the funding-type benchmark.
State and carrier. Per-member commission varies enormously by geography, with published data showing more than a 30x spread between the highest and lowest states.
Ancillary attach. Dental, vision, life, and disability often pay a higher percent than medical, so attach rate materially lifts revenue per group.
Make this page yours: replace the Table 2 ranges with your agency’s actual realized PEPM by group size. That single proprietary column turns this from a benchmark you read into the one others cite.
Frequently asked questions
- How much commission does a group health broker make?
- Typically 3% to 7% of premium on fully-insured groups, declining as group size rises, or roughly $18 to $27 per employee per month on small groups. Large and self-funded groups usually move to a negotiated PEPM or flat fee.
- Is group health commission paid every year or just the first year?
- Group health commission is generally level, meaning the broker earns the same rate at renewal as in year one. This recurring structure is what gives a benefits book its annuity-like value.
- Why does commission percentage drop as the group gets bigger?
- Carriers and employers expect economies of scale on larger groups, and large groups gain the leverage to negotiate compensation down or convert it to a flat fee. Total dollars still rise because premium volume grows faster than the rate falls.
- What is PEPM?
- Per employee per month: a flat dollar fee paid for each enrolled employee, common on larger and self-funded groups in place of a percent-of-premium commission.
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Sources & methodology
- Percent-of-premium and PEPM ranges: Mira Health, Average Insurance & Benefits Broker Commissions, 2025 (health 3–7%); carrier ERISA 408(b)(2) compensation disclosures (e.g. 3.2% at 1–50, 2.4% at 51–99; $24 PEPM filings).
- Geographic spread: Mira Health analysis of NAIC data, 2025 (Minnesota $305.28 vs. Virginia $8.16 per member, ~37x). State-by-state broker compensation is tracked by KFF, Broker Fees and Direct Sales by Health Insurance Market (the primary public source for verifying any single state).
- Large-group commission norms: Alvarez & Marsal, Broker Pricing Leverage in the Fully-Insured Group Health Market (commission ~4–5% of medical spend, declining with size).
- PEPM dollar derivation: applied to small/large-group premium PMPM (~$650–$655) from California DMHC 2024 Annual Rate Filings, May 2025.
- New vs. renewal and product contrasts: Nava Benefits, Employee Benefits Broker Commissions, 2025; Sonant, Insurance Agent Commission Structure Guide, 2026.
- Note on figures: carriers guard exact schedules, so percent and PEPM figures are well-bounded market ranges, not a single published rate. Geographic and carrier variation is large.
