Willis North America chief executive officer Don Bailey yesterday called for the insurance industry to end contingent commissions.

Speaking at a public hearing in Buffalo, New York, Mr. Bailey told representatives of the New York Superintendent of Insurance and Attorney General that a new set of standards was needed for brokers.

"Establishing a standard set of principles for insurance broker compensation and disclosure is critical to improving trust and transparency in the industry," Mr. Bailey said.

"Clients of all sizes and complexities need to be absolutely certain that their brokers keep their interests paramount; otherwise, they will question the integrity of the services we provide. For us, that's not acceptable. We believe client trust is non-negotiable."

In October 2004, Willis became the first major insurance broker to voluntarily commit to ending the practice of accepting contingent commissions, which are payments to brokers from insurers based on the volume of business steered to them.

Mr. Bailey said: "We did away with contingent payments because we believe that brokers should be paid for the quality of service they provide to clients, not for the volume of business guided to a carrier and not for the profitability of a client to a carrier.

"In this spirit, we are proposing that all broker contingent compensation agreements be abolished throughout the insurance industry; that all broker compensation be made transparent; and, that a level playing field be created where all brokers abide by the same rules."