00396E (06-12) MGA - Associate Broker Agreement
Name of the Associate Broker Please Print Between and Desjardins Financial Security Life Assurance Company (Desjardins Financial Security) 1. Appointment 1.1 Subject to the terms and conditions of this Agreement, Desjardins Financial Security appoints the Associate Broker as its agent to solicit insurance for Desjardins Financial Security. 2. Responsibilities The Associate Broker has the following responsibilities: 2.1 To secure and transmit promptly to Desjardins Financial Security, all applications and premiums or other payments received by the Associate Broker and to promptly deliver to any applicant all policies and other documents forwarded to the Associate Broker. 2.2 Not to pay any premium or portion thereof on behalf of any applicant. 2.3 To act in the best interest of Desjardins Financial Security and to exercise the care, skill and integrity that can be reasonably expected of a distributor of financial services. 2.4 To obtain and maintain any license, certificate or registration required by applicable law or by any regulatory or governmental authority having jurisdiction and to pay any applicable fees. 2.5 To make all reasonable efforts to maintain in force policies sold under this Agreement and to perform such other services as may reasonably be required in the best interest of the policyholder and Desjardins Financial Security. 2.6 To comply at all times with any Code of Ethics and Professional Guidelines as adopted by the Canadian Association of Insurance and Financial Advisors or adopted by 2.7 To comply with all rules and regulations and other written directives established from time to time by Desjardins Financial Security and all of the statutory requirements and regulations and regulatory guidelines and directions in each of the jurisdictions in which the Associate Broker operates, including but not limited to rebating, twisting, projecting or illustrating policy results contrary to such rules, regulations, directives, statutes, regulatory guidelines and directions. 2.8 Not to engage in systematic replacement of existing life insurance or disability insurance contracts of any financial institution. 3. Contracts Of Agency The Associate Broker shall, at all times, be an independent contractor. No provision of this Agreement shall be construed as creating the relationship of employer and employee between Desjardins Financial Security and the Associate Broker. 4. Previous Agreement 4.1 This Agreement replaces any previous Agreement between the Associate Broker and For greater certainty, if the Associate Broker was an Desjardins Financial Security agent of any type immediately prior to the execution of this Agreement, then the execution of this Agreement shall terminate such prior contract, except that any provisions of that prior contract which are stated to survive termination shall survive in accordance with the terms thereof, and any amounts due or accruing or to become due or accruing under the said Agreement shall continue to be due or accrued. 00396E (06-12) Desjardins Financial Security Life Assurance Company 1
5. Limitation Of Authority The authority of the Associate Broker shall extend no further than stated in this Agreement. For greater certainty, but not so as to limit the generality of the foregoing, the Associate Broker shall have no authority to: 5.1 Incur any liability or debt on behalf of 5.2 Bind Desjardins Financial Security on any insurance or other risk including the assumption of risk on the revival of policies. 5.3 Extend the time for the payment of, or waive the requirement for payment of, any premium. 5.4 Grant, make, alter, or discharge any contract, lease or Agreement on behalf of 5.5 Retain, for any reason, all or part of any premium or any other moneys collected by the Associate Broker on behalf of 5.6 Publish, distribute, broadcast, or circulate advertisements with respect to Desjardins Financial Security or any of Desjardins Financial Security s products unless such materials or acts have been duly authorized by 5.7 Institute or defend any legal proceedings on behalf of 6. Special Provisions 6.1 Desjardins Financial Security by providing thirty (30) days notice to the Associate Broker, may withdraw any product or agreements. 6.2 Desjardins Financial Security is not required to give the Associate Broker any prior notice of change in compensation or of changed or replaced financial services contracts. 6.3 Before satisfying any claims by the Associate Broker under this Agreement, Desjardins Financial Security may offset against any such claims any debt or liability due or owing by the Associate Broker to Desjardins Financial Security or to Desjardins Financial Security s affiliates. Any balance owing to Desjardins Financial Security shall be repaid on demand. 6.4 If Desjardins Financial Security returns part or all of a premium to an applicant whose application was submitted by the Associate Broker to Desjardins Financial Security, the Associate Broker agrees to repay to Desjardins Financial Security any remuneration received in connection with any such refunded premium or, at the option of Desjardins Financial Security, to the setting-off of such remuneration against any amount payable to the Associate Broker by 6.5 Following termination of this Agreement, Desjardins Financial Security may withhold payment of all compensation until the potential chargeback on all business settled under this Agreement falls below the value of any accumulated compensation. 7. Declined Applications 7.1 Desjardins Financial Security reserves the right to decline any application for insurance or other financial services and the Associate Broker shall not be entitled to any commission or compensation of any kind in respect of any application declined by 8. Records and Ownership 8.1 All of the Associate Broker s client records and files, whether in written or electronic form, letters, documents and other papers relating to business written by the Associate Broker under this Agreement, and maintained by the Associate Broker shall remain at all times the property of the Associate Broker. 8.2 All books of accounts, letters, documents and other papers maintained by the Associate Broker relating to the business of Desjardins Financial Security solicited pursuant to this Agreement, shall, at all times, be subject to inspection by any duly authorized representative of Desjardins Financial Security during normal business hours and, at Desjardins Financial Security s request, the Associate Broker shall provide copies of such documentation to 2 Desjardins Financial Security Life Assurance Company 00396E (06-12)
8.3 All undelivered policies, medical reports obtained at Desjardins Financial Security s request, original applications, marketing material and all other materials, whether in written or electronic form, obtained at Desjardins Financial Security s request, or in connection with Desjardins Financial Security s business, shall be returned on demand to Desjardins Financial Security, and at all times laws and regulations relating to copyrighted material will be respected and adhered to. 8.4 All rate books/cards, computers, software, equipment, documents, training materials, planning material, presentation material, third party documents, printed matter, supplies or other materials furnished by Desjardins Financial Security will remain the property of Desjardins Financial Security and will be returned to Desjardins Financial Security on demand. Desjardins Financial Security reserves the right to inspect said material at any time during normal business hours and/or any location. 8.5 Provisions 8.1, 8.2, 8.3 and 8.4 shall survive the termination of this Agreement. 9. Assignments 9.1 The assignment or transfer of any rights or sums payable under this Agreement is subject to Desjardins Financial Security s prior written consent. No right or interest of the Associate Broker, in or under or by virtue of this Agreement shall be merged, or assigned, or subject to sale or assignment without the specific prior written consent of Desjardins Financial Security. Desjardins Financial Security will consider a request by the Associate Broker for an absolute assignment (sale) of the Associate Broker s entitlement to commissions with respect to any and all policies on which commissions are payable, provided that: a) the assignee holds an Associate Broker s Agreement - Individual or Corporate - with Desjardins Financial Security, b) the assignee holds all licenses, permits or registrations necessary to distribute the financial services on which commissions are being assigned, and c) the Associate Broker s account has a zero or credit balance at the time of the assignment. In addition, any assignment to a non-armslength party shall stipulate that, in the event that any chargebacks of commissions or any other compensation paid or credited by Desjardins Financial Security to either the assignor or assignee are required with respect to policies covered by the assignment, after the date of assignment, both the assignor and the assignee shall be jointly and severally responsible for repayment thereof to 9.2 If the Associate Broker named in this Agreement is a corporation, the Associate Broker covenants that it will not permit the transfer or issuance of share capital without the prior written consent of Desjardins Financial Security, in accordance with provision 9.1. Consent may not be unreasonaby withheld by Desjardins Financial Security. 10. Effective Date 10.1 This Agreement shall take effect on the date of the Associate Broker s signature, provided this Agreement has subsequently been signed by a duly authorized representative of Desjardins Financial Security. 11. Accounts 11.1 The records of Desjardins Financial Security shall be conclusive evidence of the state of accounts between the Associate Broker and Desjardins Financial Security, unless the Associate Broker notifies Desjardins Financial Security of the problem in the accounts within 90 days after receipt. Desjardins Financial Security undertakes to provide the Associate Broker with monthly production and earnings statements within thirty (30) days following the end of each month. 00396E (06-12) Desjardins Financial Security Life Assurance Company 3
12. Entire Agreement 12.1 This Agreement, including any schedules, supplements, amendments, or rules and regulations as established from time to time by Desjardins Financial Security, represents the entire agreement between the Associate Broker and Desjardins Financial Security. Desjardins Financial Security will not be bound by any promise, agreement, understanding or representation, unless it is made in this Agreement or in a written document signed by an authorized official of Desjardins Financial Security which is meant to amend, alter or add to this Agreement. 13. Waiver 13.1 Failure on the part of Desjardins Financial Security to enforce any terms or conditions or to exercise Desjardins Financial Security s rights under this Agreement, or to insist on the Associate Broker s compliance with this Agreement shall neither constitute a waiver of Desjardins Financial Security s rights under this Agreement nor release the Associate Broker from any of the Associate Broker s obligations under this Agreement. 14. Compensation 14.1 Desjardins Financial Security shall pay to the Associate Broker commissions at the rate set out in the then current commission schedule of 14.2 Desjardins Financial Security has the right to amend or revise from time to time its commission schedule. No advance notice of any amendment or revision is necessary. 14.3 For certain products or situations, commissions may vary from those specified in the commission schedule. These include: extra premiums for rating or additional risk, conversion, amendment or exercise of options under existing contracts, benefits and riders. 14.4 Any obligation to pay commission is subject to any restriction or limitation imposed by law. 14.5 Annualized Commissions. Subject to the following conditions, Desjardins Financial Security shall pay the total first year commission in respect of each contract for which the initial premium has been paid; the conditions are: a) Desjardins Financial Security shall have the right to establish reasonable limits on the amount of commission; and b) the annualized commission arrangement does not apply in respect of certain types of products, including annuities, investment products, group insurance and segregated funds. 14.6 Chargebacks. If any policy should lapse, terminate or the premiums decrease prior to the expiry of the period of time specified in the chargeback rules of Desjardins Financial Security, the Associate Broker will on demand repay to Desjardins Financial Security the unearned portion of the commission. At the option of Desjardins Financial Security, the chargeback may be set-off against future commissions. 15. Vesting 15.1 Commissions which are payable in respect of the sale of an individual life insurance contract (except segregated funds) are fully vested. That means that notwithstanding the termination of this Agreement, commissions will be paid to the Associate Broker as if this Agreement remained in effect; EXCEPT in the circumstances described in provisions 14.6 or 16.1(c) or if the Associate Broker is indebted to 15.2 In the common interest of client retention and growth in an increasingly competitive environment, and notwithstanding the rights & privileges extended under Provision 8.1, Desjardins Financial Security reserves the right to periodically develop and implement direct solicitation programs. Both the Associate Broker and Desjardins Financial Security have a shared responsibility in providing service to 4 Desjardins Financial Security Life Assurance Company 00396E (06-12)
the client; both may contact the client to provide customer service. 15.3 The Associate Broker may not solicit any client to replace any existing contract except where it is in the best interest of the client to do so. 16. Termination 16.1 This Agreement will terminate automatically: a) upon the death of the Associate Broker if the Associate Broker is an individual; b) upon the winding-up, dissolution, insolvency or bankruptcy of the Associate Broker (whether an individual or not); or c) upon the Associate Broker ceasing to have all necessary permits, approvals, licenses or registrations which are required to sell the types of contracts which the Associate Broker distributes under this Agreement. 16.2 This Agreement may be terminated by the Associate Broker or Desjardins Financial Security by giving thirty (30) days notice to the other party. 16.3 Desjardins Financial Security may give notice at any time that it refuses to accept any additional contracts solicited by the Associate Broker. 16.4 After this Agreement terminates, commissions may be withheld if the total amount of annual commissions due to the Associate Broker under this Agreement is less than one hundred dollars ($100) in any calendar year. 16.5 Provisions 8, 11.1, 14.5, 14.6, 15.1, 15.2, 15.3 and 16.4 shall survive the termination of this Agreement. 17. Notice 17.1 Any notice under this Agreement may be effectually given by or on behalf of Desjardins Financial Security by delivering the same to the Associate Broker or by mailing it to the last known address of the Associate Broker as shown on the records of Desjardins Financial Security and any notice to Desjardins Financial Security shall be in writing and mailed to Desjardins Financial Security at its Head Office and any mailed notice shall be deemed to be received on the third day following the date of the mailing. 18. Confidentiality 18.1 The Associate Broker shall hold in confidence, and shall not copy, use or disclose any information about any client or clients of Desjardins Financial Security, or about Desjardins Financial Security s contracts with individuals or corporations. The Associate Broker consents to Desjardins Financial Security making use of information about the Associate Broker for purposes of publication of sales results and enforcing this Agreement. 19. Advertising And Promotion 19.1 The Associate Broker is at liberty to advertise and promote any or all Desjardins Financial Security s products provided that Desjardins Financial Security has approved in advance and in writing any advertising or promotional activity making reference to any or all of Desjardins Financial Security s products, or to Desjardins Financial Security itself. 20. General Any advertising or promotional activity making reference to Desjardins Financial Security s products or Desjardins Financial Security shall reflect favourably on Desjardins Financial Security s products or Desjardins Financial Security (as the case may be) and the name, reputation and goodwill thereof. Unless otherwise expressly agreed in writing, such advertising shall be at the Associate Broker s expense. 20.1 Words denoting one gender include the other or the neuter and words denoting the neuter include either gender, as the context or subject matter requires. 20.2 Words denoting the singular form include the plural and visa versa, as the context or subject matter requires. 00396E (06-12) Desjardins Financial Security Life Assurance Company 5
20.3 This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and, where applicable the federal laws of Canada. 20.4 Headings are for convenience or reference only and shall not affect the interpretation of this Agreement. 20.5 Any term, condition or provision of this Agreement which is, or shall be deemed to be void, prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be severable herefrom without in anyway invaliditing the remaining terms, conditions and provisions of this Agreement, and any such avoidance, prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such term, condition or provision in any other jurisdiction. 20.6 The provisions of this Agreement may be changed, waived, discharged or deleted only by an instrument in writing signed by both parties hereto. However, the provisions of this Agreement shall be deemed to be automatically amended in order to conform with any changes in applicable federal or provincial legislation and regulatory requirements to the extent required to ensure such conformity. Also, Desjardins Financial Security may unilaterally from time to time establish, change or revoke any guidelines or issue revised schedules to this Agreement. 6 Desjardins Financial Security Life Assurance Company 00396E (06-12)
Signed at this day of year Signature of Associate Broker Name of Associate Broker- Please Print Signature of Witness Name of Witness - Please Print Section Below is to be Completed by Desjardins Financial Security Life Assurance Company Signed at this day of year Signature of DFS Authorized Official Name of DFS Authorized Official - Please Print Title of Authorized Official - Please Print Signed at this day of year Signature of DFS Authorized Official Name of DFS Authorized Official - Please Print Title of Authorized Official - Please Print 00396E (06-12) Desjardins Financial Security Life Assurance Company 7
MGA s Recommendation of Appointment Name of Managing General Agency (MGA) - Please Print On behalf of Name of Associate Broker - Please Print I recommend the appointment of named in the attached Associate Broker Agreement by Desjardins Financial Security Life Assurance Company ( Desjardins Financial Security ) and its agent. The MGA acknowledges responsibility for any debit balance in the Associate Broker s account and authorizes Desjardins Financial Security to set off any such debit balance against monies due to the MGA. Signed at this day of year Signature of MGA Authorized Official Name of MGA Authorized Official - Please Print Name of MGA Address of MGA 00396E (06-12) Desjardins Financial Security Life Assurance Company 8