Why Should I Buy E&O Insurance from

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Diane Wheeler
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1 Why Should I Buy E&O Insurance from Senior Market Sales, Inc. Who is Eligible for this Program? Agents Affiliated with Senior Market Sales, Inc. EXCELLENT COVERAGE! Four Coverage Options Available Reduced Deductible for Products sold through Senior Market Sales, Inc. Limits of Liability: Each Claim/ Aggregate Each Agent OR Each Claim/ Aggregate Each Agent Deductible (applies to damages and defense): $ 250 Products provided through Senior Market Sales, Inc. $1,500 All Other Covered Products & Services Coverage Includes the Solicitation, Sale or Servicing of: Group and Individual Accident and Health Medicare Supplement Medicare Advantage (including Part D) Long Term Care *Life Insurance (other than variable life insurance products) *Annuities (other than variable) *Fixed life and fixed annuities are covered under the Basic Plus coverage level EASY ENROLLMENT! Online Enrollment Available 24/7 Sponsored by: Senior Market Sales, Inc. SrMktSalesFFFlr v1 Also Covered: Providing advice, consultation and administration of the above products, whether or not a fee is charged Financial Planner Activities (related to covered products) Supervision, management and training of an agent by a general agent $50,000 of coverage to pay for Damages or Claim Expenses resulting from a violation of a Privacy Regulation (includes HIPAA) ($5,000 deductible applies) What If I Have Questions? Call our Customer Care Department: (800) Monday through Friday 7:00 a.m. to 5:00 p.m. PST Brown & Brown of California, Inc. dba CalSurance Associates California License # 0B02587 Please review the attached program materials. A specimen policy is available at Page 1 of 6

2 Agents Affiliated with Senior Market Sales, Inc. Agent s E&O Program Outline of Coverage Policy Period: September 1, 2011 to September 1, 2012 Insurer: Aspen Specialty Insurance Company (a member of The Aspen Group) A Non-Admitted Carrier Rated A (Excellent) XV, by A.M. Best Company The information obtained from A.M. Best dated October 6, 2010 is not in any way Brown & Brown of California, Inc. s warranty or guaranty of the financial stability of the Insurer and the information is current only as of the date of the publication. Policy Number: LRA7C Risk Purchasing Group Membership: By applying for this insurance, Agents are applying for membership in the Financial Sales Professionals Risk Purchasing Group, a group formed and operating pursuant to the Liability Risk Retention Act of 1986 (15 USC 3901 et seq.). There is no additional charge for membership. Limit of Liability: Each Claim Aggregate OR Each Claim Aggregate Deductible (Damages and Defense): $250 Products sold through Senior Market Sales, Inc. $1,500 All other Covered Products Retroactive Date: The inception date of the Agent s first claims-made life insurance agents professional liability policy from which coverage has been maintained in force without interruption. Insured: 1) Agents Affiliated with Senior Market Sales, Inc. who have enrolled in the program and paid their premiums. 2) An entity owned and controlled by an Agent, arising solely from the performance of Professional Services provided by the Agent; 3) An employee acting in his or her capacity as such on behalf of an Agent, arising solely from the performance of Professional Services by the Agent; 4) The legal heir, executor, administrator or legal representative of an Agent in the event of such Agent s death, incapacity or bankruptcy; 5) The lawful spouse or domestic partner of any individual which qualifies as an Insured under Sub-sections 1., 3., or 4., above, for a Claim arising solely out of spousal or domestic partner status, and not out of any alleged independent wrongful acts, of such individual; or 6) The Sponsoring Company, but only for its vicarious liability for the covered acts of an Agent. Coverage: The Insurer shall pay on behalf of the Insured all sums in excess of the deductible which the Insured shall be legally obligated to pay as Damages resulting from Claims first made for any actual or alleged negligent act, error or omission solely while performing Professional Services for others, including Personal Injury. Professional Services: The solicitation, sale or servicing of: a) Individual or group accident or health insurance, Medicare Supplement, Medicare Advantage (including Medicare Part D), disability insurance, and senior dental insurance; b) Final expense and guaranteed final expense; c) Long term care insurance; d) Fixed life insurance and fixed annuities (covered under Basic Plus coverage option); or e) Providing financial planning services solely in connection with the products sold in Sub-sections a. d. Note: Level A includes products listed above when sold through sponsor only; Level B includes products listed above regardless of whether they are sold through the sponsor. Coverage Extensions: Disciplinary Proceedings Subpoena Compliance Privacy Breach Mediation/Deductible Credit Reimbursement of Expenses Pre-Claims Assistance Crisis Management Public Relations E-Discovery Error and Educational Instruction Extended Reporting Period: If, during the Policy Period, the Sponsoring Company terminates an Agent s contract, the insurance for such Insured shall continue until the end of this Policy Period. If, during the Policy Period, an Agent retires or becomes disabled or deceased, the Agent or its legal representative may elect to purchase an Extended Reporting Period - 3 years: 200% of last annual premium - 5 years: 300% of last annual premium - Unlimited: 400% of last annual premium Claims Administrator: Lancer Claims Services 681 S. Parker St. #300 Orange, CA (800) Program Administration: Brown & Brown of California, Inc. dba CalSurance Associates California License #0B02587 Please review the attached program materials. A complete copy of the specimen policy is available by calling or by visiting SMS_EXCL_ v7 Brown & Brown of California, Inc. dba CalSurance Associates California License # 0B02587 Page 2 of 6

3 EXCLUSIONS This Policy does not apply to any Claim based upon, arising out of, directly or indirectly, or in any way involving A. Any dishonest, fraudulent, criminal, malicious or purposeful act, error or omission committed by or at the direction of an Insured; however, notwithstanding the foregoing, the Insured shall be afforded a defense, if these allegations arise out of Wrongful Acts otherwise covered under this Policy, until the allegations are subsequently proven by a final adjudication or if the Insured admits such allegation. In such event, the Insured shall reimburse the Insurer for all Claims Expenses incurred by the Insurer. B. Any Claim brought or maintained, directly or indirectly, by or on behalf of any: 1) Insured; however this Exclusion shall not apply to any alleged Wrongful Termination; 2) Insurer or Broker-Dealer; 3) Insurance agent or broker; 4) Entity that is not a client of an Insured; however, this Exclusion shall not apply to any Claim brought by an entity who is an alleged beneficiary, heir, executor or administrator of a deceased client of an Insured; 5) Any entity which an Insured owns, operates, controls or manages; or 6) Any governmental or quasi-governmental entity, or Self- Regulatory Organization including, but not limited to, any state or federal insurance or securities commission or agency, or the Financial Industry Regulatory Authority or the Securities and Exchange Commission,; however, this Exclusion shall not apply to a Claim brought by or on behalf of such entity in its capacity as a client of an Insured or to the extent it is inconsistent with Section II.A.EXTENSIONS OF COVERAGE. C. Any fact, circumstance, or situation which has been the subject of any written notice given under any insurance policy issued by any insurer, including any policy of which this Policy is a renewal or replacement. D. Any Claim, demand, suit, litigation or other proceeding against any Insured which was pending on or existed prior to the inception of the Policy Period, or the same or substantially the same facts, circumstances or allegations which are the subject or the basis for such Claim, demand, suit, litigation or other proceeding. E. Any Wrongful Act or Interrelated Wrongful Acts first occurring before the applicable Retroactive Date, even if the Wrongful Act or Interrelated Wrongful Acts continue after the Retroactive Date. F. Any services as, or which may only be performed by, an accountant, actuary, lawyer, real estate agent/broker, property/casualty insurance agent, or third-party claims administrator. G. Any placement of a client s coverage or funds directly or indirectly with any entity which is not licensed to conduct business in the state or jurisdiction with authority to regulate such business; however, this Exclusion shall not apply to the placement of a client s coverage or funds directly or indirectly with an eligible surplus lines insurer in the state or jurisdiction with authority to regulate such business. H. Any ownership, formation, sale, servicing, operation, or administration of any insurance company, health maintenance organization, preferred provider organization, captive, risk retention group, self-insurance group/program, or purchasing group. I. Any sale, servicing, or administration of, or advice or planning with respect to, any Multiple Employer Welfare Arrangement. J. Any pension, profit sharing, health/welfare or other employee benefit plan, insurance plan or trust, sponsored by an Insured as an employer. K. Any financial inability or refusal to pay, insolvency, receivership, bankruptcy, or liquidation of any entity in which an Insured has placed or recommended to be placed, coverage or the funds of a client; however, this Exclusion shall not apply to any insurer that was rated A- or better by A.M. Best at the time of the Insured s acts. L. An Insured s inability or refusal to pay or collect premium, claim or tax monies. M. Any liability of others assumed by an Insured under any contract or agreement, unless such liability would have attached to an Insured even in the absence of such an agreement; or any guarantees or warranties. N. Any gaining of any personal profit or advantage to which an Insured is not legally entitled, or any disputes involving an Insured s fees, charges, entitlements, or other compensation. O. Any commingling or use of client funds or accounts. P. Any willful violation of the rules or regulations of the Financial Industry Regulatory Authority, Securities and Exchange Commission, Securities Act of 1933, Securities Exchange Act of 1934, Investment Company Act of 1940, or the Investment Advisors Act of 1940 and any amendments thereto, or of any state securities statute or state regulatory agency. Q. Any Security(ies). R. Any insurance or financial product owned in whole or in part by an Insured. S. Any structured settlements. T. Any bodily injury, sickness, disease, emotional distress, mental anguish, outrage, humiliation or death; or injury to or destruction of any tangible property, including loss of use thereof. U. Any discrimination, harassment, or misconduct by an Insured because of race, creed, color, age, gender, sex, sexual preference or orientation, national origin, religion, disability, handicap, marital status, or any other class protected under federal, state, local or other law; or by an employee, former employee, or job applicant, of an Insured in their capacity as such. V. Any infringement of copyright; plagiarism, piracy or misappropriation of ideas; or infringement of title, slogan, trademark, trade name, trade dress, service mark or service name; or any patent or trade secret; or any unfair competition, deceptive advertising, anticompetitive acts, restraint of trade, price fixing, or antitrust. W. 1) Promissory notes, issuer callable Certificates of Deposits, or step-up or step down Certificates of Deposits; 2) Viatical or life settlements, reverse mortgages, or any similar transaction in which the present value of a conditional contract is exchanged or sold; or 3) Tangible personal property, including but not limited to, any precious metals, gemstones, stamps, sports or other cards, antiques, jewelry, coins or other collectibles; however, this Exclusion shall not apply to gold or silver. SMS_EXCL_ v1 Brown & Brown of California, Inc. dba CalSurance Associates California License # 0B02587 Page 3 of 6

Enrollment Form Claims Made & Reported Errors & Omissions Coverage Policy Period: September 1, 2011 to September 1, 2012 By purchasing this insurance, agents become members of the Financial Sales

4 Enrollment Form Claims Made & Reported Errors & Omissions Coverage Policy Period: September 1, 2011 to September 1, 2012 By purchasing this insurance, agents become members of the Financial Sales Professionals Purchasing Group, a group formed and operating pursuant to the Liability Risk Retention Act of 1986 (15 USC 3901 et seq.). There is no additional charge for membership. Instructions... ALL sections must be completed. Incomplete forms will take additional time to process. Please allow up to ten (10) business days for processing. Return this form along with payment to: Brown & Brown of California, Inc. dba CalSurance Associates, P.O. Box 7048, Orange, CA Coverage Questions...Call Brown & Brown of California, Inc. dba CalSurance Associates* at (800) or at info@calsurance.com Certificates of Insurance...Go on-line: - Certirficate Reprinting - Sponsoring Group - Senior Market Sales, Inc. Section 1 - Your Information (Please Print Clearly) First Name Street Address City - - Contact Phone Number Fax Number - - Last Name Mailing Address (if different than street address) State Zip Code Section 2- Effective Date and Amount Due Effective Date of Coverage - - NOTICE: Effective date of coverage cannot be prior to your date of contract with the sponsor and cannot be backdated to a prior month. Limit of Liability: (Select One) Coverage Level*: (Select One) Products Covered*: (Select One) per Claim / Aggregate per Claim / Aggregate Level A: (Products sold through Senior Market Sales, Inc.) Level B: (Products sold through all companies) Basic: (A&H, FInal Expense, and Long Term Care) Basic Plus: (Also includes fixed life and fixed annuities) Midterm Enrollment Factors Calculate Total Amount Calculate Due: Total Amount Due: Effective Month Factor $ September $ Total Annual Premium of Selected Coverage Option October Premium for Selected Options November (See X Premium Chart) December Surplus Lines Factor (from Chart) X January X February Surplus Lines Factor (See Enclosed Chart) Midterm Enrollment Factor (from Chart at left) March $35.00 April Admin Fee $35.00 May Admin Fee June = July Total = Amount Due August Total Amount Due *Please refer to the Outline of Coverage for coverage level details. Birthdate - - Section 3 - Payment Check or Money Order: Check made payable to Brown & Brown of California, Inc. dba CalSurance Associates for the total amount due. Other payment options including installments by credit card or ACH (Debit to Checking) are available online at: Section 4 - Notices and Warranties NOTICE: I must be a currently affiliated with Senior Market Sales, Inc. to be eligible for this program. Otherwise, I will not be considered an Insured under this program and no claims made against me will be covered. I warrant that I am currently contracted with Senior Market Sales, Inc. NOTICE: This is a claims made and reported policy. If I have knowledge of any claim or incident that could give rise to a claim under the proposed policy and any claim or action arises therefrom, it is excluded from coverage for which this form applies. A potential gap in coverage may occur if I elect an effective date that is not continuous with my prior expiration date, and may result in the denial of a claim. I warrant that I have no knowledge of any pending claim or incident that could give rise to a claim under the proposed policy. I acknowledge that the specimen policy and program materials have been delivered to me via and I have reviewed these documents prior to enrolling in the program. I warrant and represent that the above statements are true and that I have not suppressed or misstated any material facts and I agree that this application shall be the basis of the contract with the company issuing the policy. It is understood that completion of this application does not bind the company to issue or the applicant to purchase the insurance. I have read the above notices and warranties and agree. Signature (Required) Today s Date SrMktSalesApp v8 Brown & Brown of California, Inc. dba CalSurance Associates * California License # 0B02587 Page 4 of 6

5 Premium Chart E&O Program For Agents Affiliated with Senior Market Sales, Inc. Program Effective September 1, 2011 to September 1, 2012 Limit of Liability (per Claim/ Aggregate Effective Month Level A Products of Senior Market Sales, Inc. Only Level B Products of Senior Market Sales, Inc. & Other Companies Basic (Accident & Health, Final Expense and Long Term Care) Basic Plus (Also includes Fixed Life and Fixed Annuities) Basic (Accident & Health, Final Expense and Long Term Care) Basic Plus (Also includes Fixed Life and Fixed Annuities) September, 2011 $350 $415 $405 $475 $400 $465 $455 $525 October, 2011 $322 $381 $372 $437 $368 $427 $418 $482 November, 2011 $292 $346 $338 $396 $334 $388 $380 $438 December, 2011 $263 $312 $305 $357 $301 $350 $342 $395 January, 2012 $234 $277 $270 $317 $267 $310 $304 $350 February, 2012 $204 $242 $236 $276 $233 $271 $265 $306 March, 2012 $177 $210 $205 $240 $202 $235 $230 $265 April, 2012 $147 $174 $170 $200 $168 $195 $191 $220 May, 2012 $118 $140 $137 $161 $135 $157 $154 $177 June, 2012 $ 89 $105 $ 103 $120 $101 $118 $ 115 $133 July, 2012 $ 60 $ 71 $ 69 $ 81 $ 68 $ 80 $ 78 $ 90 August, 2012 $ 30 $ 36 $ 35 $ 41 $ 34 $ 40 $ 39 $ 45 Above rates do not include state surplus lines tax or the non-refundable $35 administrative fee. SrMarketSalesMarix v6 Brown & Brown of California, Inc. dba CalSurance Associates California License # 0B02587 Page 5 of 6

6 Premium Tax Chart Surplus Lines and Stamping Fees Worksheet - As of January 2011 State Surplus Lines Multiplier~ State Surplus Lines Multiplier~ Alabama Nebraska Alaska Nevada * Arizona New Hampshire Arkansas New Jersey California New Mexico Colorado New York Connecticut North Carolina DC North Dakota Delaware Ohio Florida Oklahoma Georgia Oregon Hawaii Pennsylvania ** Idaho * Puerto Rico Illinois ^ Rhode Island Indiana South Carolina Iowa South Dakota Kansas Tennessee Kentucky Municipal/County Tax Texas Louisiana Utah Maine Vermont Maryland Virginia Massachusetts Washington Michigan Washington, DC Minnesota West Virginia Mississippi Wisconsin Missouri Wyoming Montana * States with an * are states that DO NOT return stamping fees in the case of cancellation. 2. Illinois ^ requires premium tax and stamping fee be rounded to nearest whole dollar. 3. Kentucky+ also has Municipal/County tax which varies by location. Contact CalSurance at to determine correct tax. 4. Surplus Lines Multipliers~ are inclusive of the state specific Surplus Lines tax, stamping fees, surcharges, and Municipal/County taxes. SrMktSalsSL v2 Brown & Brown of California, Inc. dba CalSurance Associates California License # 0B02587 Page 6 of 6

TIME TO ENROLL ENROLL ONLINE IN 5 MINUTES OR LESS

TIME TO ENROLL ENROLL ONLINE IN 5 MINUTES OR LESS Group Sponsored Errors & Omissions Program Designed Exclusively for Agents Affiliated with Senior Market Sales Enroll Today at: It s time to enroll in