Common use of Commission Structure Clause in Contracts

Commission Structure. | RCA | TRAIL ----------------------------------------------------------------------- PCA | SCA | YEARS 2 - 5 | YEARS 6 + | YEARS 5 - 20 ----------------------------------------------------------------------- 90% | 5% | 5% | 2% | 0.20% net | | | | account value PCA (PRIMARY COMMISSIONABLE AMOUNT) is equal to the first year commission target premium (shown on policy schedule pages and illustrations). Gross premiums paid up to the PCA in any year are commissioned at the full PCA rate. If the gross premium paid in year one is less than the PCA, that difference is carried over to the second year. Premiums received in year two or later up to this difference, if any, are commissioned at the full PCA commission rate. A new PCA is generated any time a new base coverage segment is created. Note that a death benefit option change does not create a new PCA. Premium dollars are allocated first to PCA, then to SCA, and then to RCA. SCA (SECONDARY COMMISSIONABLE AMOUNT) is equal to the difference between the gross premiums paid in segment year one and the PCA. RCA (RENEWABLE COMMISSIONABLE AMOUNT) equals zero in the first policy year. In renewal years, the RCA equals the gross premium paid per segment less the remaining PCA for that year, but never less than zero. Schedule H

Commission Structure. | RCA | TRAIL ----------------------------------------------------------------------- ------- -------- ---------------------------- ---------------- PCA | SCA | YEARS 2 - 5 | YEARS 6 + | YEARS 5 - 20 ----------------------------------------------------------------------- ------- -------- -------------- ------------- ---------------- 90% | 5% | 5% | 2% | 0.20% net | | | | account value PCA (PRIMARY COMMISSIONABLE AMOUNT) is equal to the first year commission target premium (shown on policy schedule pages and illustrations). Gross premiums paid up to the PCA in any year are commissioned at the full PCA rate. If the gross premium paid in year one is less than the PCA, that difference is carried over to the second year. Premiums received in year two or later up to this difference, if any, are commissioned at the full PCA commission rate. A new PCA is generated any time a new base coverage segment is created. Note that a death benefit option change does not create a new PCA. Premium dollars are allocated first to PCA, then to SCA, and then to RCA. SCA (SECONDARY COMMISSIONABLE AMOUNT) is equal to the difference between the gross premiums paid in segment year one and the PCA. RCA (RENEWABLE COMMISSIONABLE AMOUNT) equals zero in the first policy year. In renewal years, the RCA equals the gross premium paid per segment less the remaining PCA for that year, but never less than zero. Schedule HPremiums received within 15 days prior to policy anniversary will result in the agent receiving commissions at the same rate as if the premium was paid on the anniversary date.