Auto insurance is mostly sold through agents or agency companies. It is normal that the insurance company should give the agent a commission or channel fee (handling fee) for every policy sold.
However, due to the sharp increase of insurance companies in recent years, new insurance companies have given agents more channel fees in order to open up the market. For example, it is normal to pay 15% all the time, so now he pays 25%, which is naturally attractive to the agent, so the agent will insure the customer's car to this company, and the handling fee is very high; This led to vicious competition among companies to grab business, and the channel cost increased to 25% or even 30%.
The reasonable channel cost of the original policy in insurance operation is 15%, and the insurance company can get a little profit appropriately; But now 25% of the expenses are paid at once, and the natural operating cost has increased by 10%. What used to be a little profitable is now a loss.