NJ S3333

Boards of education and local government contracting units in New Jersey must use a competitive contracting process to procure insurance products and insurance consulting services, which are currently exempt from public bidding requirements.

Insurance consultants must be compensated directly by the public entity at a fixed amount or hourly rate, and cannot receive commissions or other compensation from insurers for services provided in connection with awarded contracts.

Both insurance consultants and insurers must submit certifications that no commissions will be paid between them, and consultants must disclose the aggregate commissions received from proposing insurers over the preceding three years.

Request for proposal notices must be published at least 60 days (but no more than 120 days) before contract commencement, at least three proposals must be obtained, and the RFP must be submitted to at least one joint insurance fund for comparison analysis.

Violations of the compensation restrictions allow public entities to terminate contracts and recover improper payments through civil action.