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USI Insurance staffers sue over voluntary benefits commission conflict
The proposed class action, filed Sept. 8, 2026, alleges USI earned $3,457,904 in commissions and administration fees tied to participant premiums from 2020 to 2024.
Seven employees have filed a proposed class action against USI Insurance, alleging the company acted as both the operator of its workplace voluntary benefits plan and the broker that selected the coverage, creating a conflict tied to participant premiums, according to Insurance Business.
The suit, filed Sept. 8, 2026 in the US District Court for the Southern District of New York, is brought under ERISA, which governs workplace benefits. Plaintiffs claim USI set its own commission and administration fee as broker, then had the insurer include those amounts in the premiums paid by plan participants.
The complaint cites Form 5500 filings and says USI and its affiliates received $3,457,904 in commissions and administration fees tied to premiums between 2020 and 2024. It also alleges specific commission structures on certain lines of coverage, including a flat $200,000 commission each year from 2020 through 2024 on Prudential life, long-term disability, and accidental death policies.
For other voluntary benefits, the filing alleges commission rates tied to premiums, including 14.70% and then 11.07% before rising to 33.72% on an accident plan, business travel accident at 25% of premiums, and critical illness at 10%. It further says telehealth commissions grew from just over $9,000 in 2022 to well over $100,000 in each of the next two years, and characterizes the arrangement as self-dealing and prohibited transactions under ERISA.