The company is also increasing medical insurance premiums by 10% in a move managing director Naomi Ballantyne said was prompted by two factors; medical inflation and a need to catch up with the rest of the market.

“It’s never our intention to have a product that’s seen as cheap, and the other companies movements in their premium rates in the last three to six months left us in a position where we were significantly behind the rest of the market,” she said.

“We picked a number we thought kept us affordable and competitive but didn’t have that big jump between us and everyone else, we didn’t want to get a whole truck load of medical business.”

Ballantyne admitted that the commission changes would prove “challenging” for advisers, especially those who sold a large amount of medical cover, but said advisers would benefit from the changes over time.

“They’ll grumble because it will hit them in the pocket on September 1, but they will also recognise the value,” she said.

“As earned is truly spread so you get paid as each premium is paid to the insurer, so its totally funded out of the premiums. The advantage is that there’s no clawback, so if the policy runs for five months, with either of the upfront models you’d be paying all of your commission back.

“With an as earned basis, you keep the five months you’ve been paid, so there’s some advantages to brokers in that respect.”

Ballantyne said ‘as earned’ had two other advantages for advisers; as commission was paid every time a premium was paid, “the higher the premium, the bigger the number for the broker,” and it also had the potential to increase the value of their business as calculated by renewals.