Tips for Brokers About the Broker of Record

What is a Broker of Record?

The following features all apply:

1. Broker owns the policy.
2. Broker may be paid commission.
3. Broker is entitled to servicing information.
4. Broker receives the renewal quote.
5. Broker is copied on communications sent to the policyholder.

What is a valid Broker of Record letter?

The features of a valid Broker of Record letter are as follows:

1. Printed on employer’s letterhead, or on ACORD 36, or the letter must indicate (with printer register of return fax number) that it was authorized and issued by employer; and
2. Addressed to State Fund; and
3. Shows a date that is current, dated within 30 days of receipt by State Fund; and
4. Expresses the employer’s intention to appoint the broker as exclusive Broker of Record; and
5. Includes employer’s name and policy number; and
6. Includes broker’s State Fund access number and complete name and address of the new broker, whose name must match the name indicated on State Fund records (Brokerage Profile); and
7. Signed and dated by the corporate officer, partner, sole proprietor, executive director (nonprofit entities only), and manager and/or managing members of Limited Liability Companies (LLCs). Includes printed name and title of signer. The signing individual must have the authority to enter the company into a contractual agreement and must be endorsed on State Fund policy records.

Note: If organization or corporation is nonprofit, provide Board Minutes. Often the policy is not updated with current members.

Can the 10-day period be waived?

No. A statement on an employer’s Broker of Record letter that the 10-day period is waived does not relieve State Fund of sending the 10-day letter to the original broker.

What determines the effective date of the Broker of Record letter?

The effective date of the Broker of Record letter will be determined on the basis of the date when State Fund receives the valid Broker of Record letter. Valid Broker of Record letters received after 5 p.m., on a weekend or a State holiday will be considered received on the next business day. A business day ends as of 5 p.m.

What is considered a midyear Broker of Record letter?

A midyear Broker of Record letter is defined as a Broker of Record letter received midyear during the policy term between inception and renewal date. Broker of Record letters received on inception/renewal date are considered midyear Broker of Record letters.

Who receives the commission on midyear Broker of Record changes?

For midyear Broker of Record changes, any commission due and payable or any reimbursement of commissions due State Fund remains between State Fund and the original Broker of Record at inception or renewal of policy.

Can State Fund contact the employer who has assigned a Broker of Record on his/her account?

State Fund reserves the right to contact the employer to ascertain the definitive Broker of Record designation.

How and where can Broker of Record letters be sent?

New Business: Broker of Record letters, with accompanying submissions, can be sent via the designated State Fund office submissions postal address, e-mail address or fax number to either the regional office where the broker or where the employer is located.

Renewal Business: Broker of Record letters can be sent via the designated Broker of Record Desk e-mail address, bordesk@scif.com, or fax number 888-302-3538.

Note: Broker of Record letters may also be submitted to your local State Fund regional office postal address.

How does a broker release representation on an account?

If a broker no longer wishes to represent an account with State Fund, the broker must submit a written request. The request must state, “relinquish ownership” or “release representation of this policy,” and be sent to the designated Broker of Record Desk by email, bordesk@scif.com, or fax 888-302-3538, or your local  State Fund regional office postal address. The letter must be signed and dated by the producer or brokerage principal/officers listed in the State Fund Brokerage Profile.

Can a broker take over a direct account as the Broker of Record?

Yes.  If a Broker of Record letter is received between the inception date and 21 days prior to the policy’s Anniversary Rating Date (ARD), the policy will be converted to a brokered policy effective the date State Fund received the valid BOR letter.  The broker will be eligible for commission at policy renewal. 

If the Broker of Record letter is received within 20 calendar days from it’s ARD or inception/renewal date, the policy will be converted after the ARD.  The broker will be eligible for commission at the next renewal period.

Can a broker submit a Broker of Record letter on a cancelled/expired broker account?

Yes, as long as the effective date of the valid Broker of Record letter is within the original policy period.