The California Department of Insurance announced on March 15 that it will be raising its fees effective June 15.
While the increase is relatively minor, the bulk of people affected will be those who are duped into pyramid schemes.
The insurance industry sees a high rate of turnover from young people looking to start a new business. While success is definitely possible, many are unprepared for the hard work and fall prey to organizations which provide almost no support.
The hike in fees may also impact the number of people who illegally transact insurance.
Ultimately, the fee hike is yet another example of corporations receiving subsidies. Rather than raising fees solely on the companies that hire and compensate insurance professionals, the fees are being imposed on their employees. The transaction costs for requiring payment from the thousands of insurance professionals, even discounting the cost of raising the fees, is far greater than a similar raise in fees levied to the much smaller number of insurance companies. Economically, the result is the exact same, since the insurance companies compensate the employees who transact the business.
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