Version:
June 27, 2000
Copyright © 1998-2000 by Jeffrey L. Nogee. All rights reserved.
Prepared
by:
Jeffrey
L. Nogee, Esq.
Nogee & Wartel
The Roosevelt Building
900 Ellison Ave., Suite 211
Westbury, NY 11590
516-222-6575
JNogee@aol.com
The following is a sample form of agreement. It is not intended to provide
legal
advice. Before entering into any contract, you should consult an attorney
experienced in the subject matter.
Insurance Service Contract
This Agreement is entered into and made effective as of ____________,
19__,
by and between ________________________________ ("Client"),
residing at
______________________________, and __________________________
("Agent"), a life insurance agent licensed to sell life insurance
in the State of
___________ with offices at ______________________________________.
RECITALS
A.
Agent is desirous of selling a policy of life insurance to Client.
B.
As an inducement to Client to purchase a policy of life insurance through
Agent, Agent is willing to provide various services to Client in connection
with obtaining and maintaining such insurance policy.
C.
Client is interested in purchasing a policy of life insurance through
Agent,
subject to the following terms and conditions.
NOW,
THEREFORE, in consideration of the premises and mutual promises
made in this Agreement, the parties have agreed as follows:
1.
Prior to executing an application for life insurance, the Agent shall
provide
and disclose to the Client the following:
a. the fact that the Agent will receive commissions from the company
issuing the life insurance policy ("Insurer");
b. the amount of the anticipated first-year commissions, renewal
commissions and any other compensation that is directly related
to the policy purchase (such as expense allowances);
c. whether the Insurer has similar products to the one being offered
to the Client which may have features more favorable to the Client;
d. whether the policy values can be improved through the use of blended
designs or other alternatives and what such alternatives are; and
e. the financial strength ratings and full reports about the proposed
Insurer
from the major rating agencies, including A.M. Best, Duff & Phelps,
Moody's, and Standard & Poor's, and any other sources which the
Agent may deem appropriate or which the Client may request.
2.
After execution of the application for life insurance through the end
of the
"free look" period, the Agent shall provide and disclose to
the Client all of
the information described in Paragraph 1(a) through (e) above, updated
to
the date of delivery of the policy to the Client.
3.
Upon issuance of the policy of life insurance, the Agent shall promptly
deliver
the policy to the Client, and in any event no more than five (5) business
days
prior to the expiration of the "free look" period described
in the policy. If the
policy is to be provided directly from the Insurer, the Agent shall
use his best
efforts to ensure that the Client receives the policy at least five
(5) business
days prior to the expiration of the "free look" period.
4.
Prior to the expiration of the "free look" period, the Agent
shall verify that
the Insurer has recorded the policy ownership and beneficiary designations
in accordance with the Client's instructions.
5.
After expiration of the "free look" period, and for so long
as the policy
remains in effect including any cure period following lapse for any
reason,
the Agent shall:
a. forward to Client all notices received by the Agent or of which the
Agent becomes aware concerning the policy issued to the Client;
b. at least annually, provide the financial strength ratings and full
reports
about the Insurer from the major rating agencies, including A.M. Best,
Fitch, Moody's, and Standard & Poor's, and any other sources which
the Agent may deem appropriate or which the Client may request;
c. at least annually, report to the Client in writing any changes in
nonguaranteed elements of the policy since its date of issue, including
without limitation changes in the dividend scale, credited interest
rate,
cost-of-insurance rates, and expense charges;
d. upon request of Client, provide, or assist Client in obtaining, an
in-force
policy illustration based on current assumptions or other specified
assumptions;
e. upon request of Client, explain, or assist Client in obtaining an
explanation of, the contract, policy illustrations, and other documents
related to the policy;
f. for fixed-premium and flexible-premium variable life policies, provide
the
Client with information on subaccount performance, using an appropriate
independent source such as Morningstar. This information may include
absolute rates of return for various periods, performance relative to
similar subaccounts in other variable products, risk measures, and
changes in investment style;
g. perform these additional services that Agent and Client have agreed
to:
______________________________________________________
______________________________________________________
h. advise the Client of any programs which the Insurer may offer or
develop
that might be beneficial to the Client, such as coverage increases with
simplified underwriting or contract changes; and
i. maintain at his or her usual place of business accurate accounts,
books
and records concerning all policies issued to the Client which were
obtained by or through the Agent or for which the Agent receives any
commission or other form of compensation or benefit, including without
limitation:
i. copies of each policy so issued;
ii. the name and address of the Insurer; and
iii. copies of all claims, requests for surrender and other matters
submitted by the Agent to the Insurer on behalf of the Client or
otherwise related to each such policy.
j. maintain, in the event the Agent discontinues conducting his or her
business as an insurance agent, all such records as required under
subparagraph 4.i until the later of the time when the Agent has
discharged all obligations to the Client under this Agreement or until
a successor Agent has been named and accepted by the Insurer and
the Client.
6.
In providing any information to Client or performing any services in
connection with the policy issued or other insurance policies or products
which the Agent may offer or discuss with Client, the Agent shall not:
a. permit or cause to be made by anyone acting on his or her behalf
any false or misleading statements or deliberately omit any material
statement that would make the information, policy or product
misleading if omitted; nor
b. require the purchase of any other policy, product or service as a
condition of any policy or product being offered or provided.
7.
If the Agent fails to fulfill any of his duties ore responsibilities
under this
Agreement, the Client may exercise any one or more of the following
remedies:
a. Client may request of the Insurer that the Agent be replaced by another
agent representing the Insurer;
b. Client may request of the Insurer that all future commissions or
servicing
fees of the Agent shall be redirected to another agent representing
the
Insurer;
c. Client may seek redress against the Agent for breach of this Agreement
by initiating arbitration pursuant to the rules of the American Arbitration
Association then in effect.
d. The foregoing remedies are cumulative and non-exclusive.
8.
All notices and correspondence shall be given in person or by certified
mail
to the parties at the addresses above. Either party may change the address
to
which notices shall be given by written notice to the other.
9.
If any provision of this Agreement or part thereof shall be held to
be invalid,
the remaining provisions and portions shall not be affected and shall
remain in
full force and effect as if such invalid provision or portion did not
exist.
10.
This Agreement may not be modified or amended except by an agreement
in
writing signed by both parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date and year first above written.
_________________________
__________________________
Client Agent
