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| Commission in a given location is based on two things, gross premium, and some discounts for high levels of revenue coverage and GRIP.
In Brown County, OH, with a 120 APH, the gross premium on an 85% RA policy = $157.60. The gross premium on an 80% policy = $128.68.
If commission equals 16%, the commission per acre on the 85% policy = $25.22/acre. Gross commission on the 80% policy would equal $20.52/acre.
I don't believe I'll sell any 80% policies this year, and definitely won't sell any 85% policies. 85% will not pay over time, and will cost more than they are worth, at current volatility levels. The only way they can pay is with major price decline, and/or yield loss spread across most units. The exception might be enterprise units, possibly combined with BYE discounts.
My opinions,
Rob
Edited by robheyen 3/13/2008 00:54
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Thanks Rob
