EXHIBIT 10.4
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UNITED INVESTORS LIFE
0000 XXXXX XXXXXX XXXXX, X. X. Xxx 00000
BIRMINGHAM, ALABAMA 35255-5926
000-000-0000
GENERAL AGENT CONTRACT
This Contract made as of the 1st day of January, 1985, between United
Investors Life Insurance Company, of Birmingham, Alabama, (hereinafter referred
to as "UNITED" or "COMPANY" and W&R Insurance Agency, Inc. (or with respect to
those states in which said corporation is not qualified, the W&R Insurance
Agency of that state which is affiliated with Xxxxxxx & Xxxx, Inc. or Xxxxxxx &
Xxxx, Inc. itself) of Xxx Xxxxx Xxxxxx, 0000 Xxxxxxxx Xxxx, Xxxxxx Xxxx,
Xxxxxxxx, (hereinafter referred to as "GENERAL AGENT" or "YOU").
UNITED and GENERAL AGENT mutually agree as follows:
1. APPOINTMENT AND RELATIONSHIP. Subject to compliance with the terms of this
Contract, applicable laws and regulations, and such rules as UNITED may
from time to time establish, GENERAL AGENT is authorized to solicit
applications for insurance on behalf of UNITED, in all jurisdictions in
which UNITED and GENERAL AGENT are authorized to engage in the business of
insurance. The COMPANY retains the right to appoint other agents
(Wholesale General Agents, General Agents, etc.) in all such jurisdictions.
You shall be free to exercise your own judgment as to the method, time,
manner, and place of carrying out your duties, responsibilities and
obligations as a General Agent, it being expressly understood that your
relationship to us shall be that of an independent contractor only, and
nothing herein shall be construed to create the relationship of employer
and employee.
2. APPOINTMENT OF AGENTS BY YOU--OBLIGATIONS OF GENERAL AGENT. As a GENERAL
AGENT of the COMPANY, YOU after reasonable investigation of background,
training, and methods of doing business, may submit agents (sometimes
hereinafter referred to as "writing agents") to write business for the
COMPANY through YOU. If any such individual shall be licensed with the
COMPANY, YOU will be responsible for his/her acts and indemnify and hold
the COMPANY harmless from any loss or expense on account of any
unauthorized act of said agent.
3. COMMISSIONS. UNITED will allow YOU the commissions specified in the
Commission Schedule attached hereto and all modifications thereof. GENERAL
AGENT agrees to accept such commissions as compensation in full for all
services performed and all expenses incurred. UNITED may at any time and
from time to time modify the Commission Schedule by adding or deleting
policy forms and changing the commission
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rates applicable to its policy forms. Any modification relating
to changes in payment of commissions shall be effective fifteen (15) days
after written notice thereof is deposited in the United States mail,
postage prepaid, addressed to the last known address of the GENERAL AGENT,
unless otherwise agreed, and shall apply only with respect to applications
taken after the effective date of such notice, unless otherwise agreed.
All other modifications shall be in writing and effective upon receipt.
GENERAL AGENT shall be solely responsible for fixing amount and payment of
commission or other compensation to agents writing business with UNITED
through GENERAL AGENT, and in doing so, GENERAL AGENT may use the
facilities and services of Xxxxxxx and Xxxx, Inc., or another affiliate for
payroll accounting and disbursement purposes.
In addition to all rules, regulations, and conditions as set forth in the
Commission Schedule, as it may be amended from time to time, commissions
are subject to the following conditions:
A. Commissions are based on premiums received by the COMPANY and are not
payable until the policy has been issued, delivered and accepted by
the applicant.
B. Should UNITED, for any reason, refund any premium or portion thereof,
all commissions paid or credited to YOU on the amount refunded shall
be immediately due and payable to the COMPANY.
C. Commissions are payable semi-monthly.
D. If a life insurance policy shall lapse for nonpayment of premium, and
if reinstatement shall occur more than 90 days after the premium due
date, no further commissions on said policy shall accrue to YOU unless
such reinstatement is accomplished by YOU and forwarded to the COMPANY
by YOU. In this subparagraph D, "YOU" shall include a licensed agent
under contract with UNITED submitting business through GENERAL AGENT.
Reinstatement is considered to occur on the date COMPANY required
forms, necessary back premiums and sufficient premiums to pay for the
policy for at least one month in advance have been received at the
Home Office.
4. COMMISSIONS ON REFUNDED PREMIUMS. UNITED will notify GENERAL AGENT of any
refund of any premium or portion thereof. All commissions paid or credited
by UNITED on the amount refunded shall be immediately due and payable to
UNITED by withholding the amount from the commission payable with respect
to future commissions payable to GENERAL AGENT. In the event of
termination of this Agreement, the parties hereto shall agree on
appropriate adjustments to account balances, based on circumstances at that
time.
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5. ASSIGNMENT. Neither this Contract nor any of its benefits shall be
assigned without the prior written consent of the COMPANY.
6. LIMITATIONS ON AUTHORITY OF GENERAL AGENT. You are not authorized and have
no authority to:
A. Make, alter, or discharge any contract for or on behalf of the
COMPANY.
B. Endorse any check, draft or similar instrument payable to the COMPANY.
C. Modify, in writing or orally, any policy, application, receipt or
other COMPANY supplied form.
D. Extend the time for payment of any premium.
E. Approve evidence of insurability.
F. Bind or otherwise commit the COMPANY to any risk.
G. Deliver a policy where the health of any proposed insured at the time
of delivery is other than as stated in the application.
7. FUNDS HELD IN TRUST AND POLICY DELIVERY. Premiums may be accepted for a
policy only in the form of a check, draft, or similar instrument made
payable to the COMPANY. Such premiums shall be considered as trust funds,
and shall be forwarded to UNITED immediately. Policies are to be delivered
to applicants promptly, and all policies not delivered are to be returned
to the COMPANY immediately.
8. REPLACEMENT. Replacement is presumed when the previous UNITED policy is
lapsed or otherwise terminated within six (6) months before or after the
date of the new policy. Unless modified by the Commission Schedule, first
year commission on the new policy is payable only on any increase in the
first year premium of that policy over the first year premium on the
COMPANY's replaced policy.
9. ADVERTISING MATERIALS AND SUPPLIES. UNITED will supply you with
advertising material and brochures to assist you in recruiting writing
agents and for use in connection with the sale of the COMPANY's products to
the public. YOU may not use, publish, or distribute advertising materials,
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brochures, etc. that are for use in connection with the sale of the
COMPANY's products to the public without securing our prior written
approval: You are free to design your own materials to recruit agents and
increase their production with the COMPANY as long as such materials
accurately and fairly describe the COMPANY's products and benefits
provided. All supplies furnished to YOU are the property of UNITED and
shall be promptly returned upon the COMPANY's request.
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10. VESTING OF COMMISSIONS. Subject to all provisions hereof, in the event of
the termination of this Contract, YOU or your legal representative shall
continue to receive commissions in accordance with the Commission Schedule
in force on the date of the termination; provided, however, that if the
commissions paid to YOU during any calendar year thereafter do not exceed
$250.00, all commissions for subsequent years shall be forfeited, and this
COMPANY shall not be required to make any further commission payments. If
any commission check shall be less than $25.00, the COMPANY shall have the
right to delay payment until such level is reached.
11. GENERAL AGENT agrees to hold UNITED harmless from any and all claims
relating to commissions of writing agents paid to GENERAL AGENT.
12. GENERAL PROVISIONS.
A. The COMPANY, in its sole discretion, may decline to consider any
application.
B. The COMPANY, in its sole discretion, may decline to license or renew
the license of any agent.
13. TERMINATION OF CONTRACT.
A. This Contract may be terminated by either party at any time for any
reason by providing 180 days' advance, written notice. Said 180-day
period shall begin when notice is deposited in the United States mail,
postage prepaid, sent to the last known address of the other party.
B. If GENERAL AGENT shall suffer loss of the authority to transact the
business of insurance in any jurisdiction, the authority of the
GENERAL AGENT to transact business in such jurisdiction under this
Agreement shall also cease.
C. This Agreement shall automatically terminate upon the liquidation,
bankruptcy, or dissolution of the GENERAL AGENT.
14. FORMER AGREEMENTS. The execution of this Agreement shall terminate and
supersede, of the effective date hereof, all agreements heretofore made
between the General Agent and the Company, covering the same subject matter
without prejudice to the rights of either party, if any, provided by such
agreement to exist after their termination.
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UNITED INVESTORS LIFE INSURANCE COMPANY
By:__________________________________________
Signature
__________________________________________
Name (print or type) Title
W & R INSURANCE COMPANY, INC.
By:__________________________________________
Signature
__________________________________________
Name (print or type) Title
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UNITED INVESTORS LIFE
0000 XXXXX XXXXXX XXXXX, X. X. Xxx 00000
XXXXXXXXXX, XXXXXXX 00000-0000
000-000-0000
JANUARY 1, 1985
GENERAL AGENT
COMMISSION SCHEDULE
________________________________________________________________________________________________________________________
TERM PRODUCTS
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1st Policy 2nd-10th Policy 11th Policy
Year Years Year and Later
---------- --------------- --------------
VITALife ART 115% 7 1/2% 3%
VITALife Adjustable 130% 7 1/2% 3%
VITALife VII 115% 7 1/28** N/A
________________________________________________________________________________________________________________________
XLife 1 AND XLife 2 INTEREST SENSITIVE PRODUCTS*
------------------------------------------------
1st Policy 2nd-10th Policy 11th Policy
Year Years Year and Later
---------- --------------- --------------
XLife 1 140% 7 1/2% 3%
XLife 2 115% 7 1/2% 3%
________________________________________________________________________________________________________________________
VITALife III PLUS - A RE-ENTRY PRODUCT*
---------------------------------------
1st Policy 2nd Policy 3rd Policy
Year Year Year
---------- --------------- --------------
At Original Issue and
Re-Entry:
3 Pay Premium Mode - 115% of 1st year -0- -0-
reduced Premium Rate
All Other Premium
Modes 55% 15% 15%
In The Event Insured Does Not Qualify for Re-Entry:
. 4th, 7th, or 9th Policy Year Thru 10th Policy Year - 7 1/2%.
. 11th policy year and later - 3%.
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SINGLE PREMIUM PRODUCTS
_____________________________________________________________________________________________________
AT POLICY ANNIVERSARY
FIRST YEAR YEARS 1 THROUGH 10
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SPLife - 1:
Option A 13% of single premium N/A
Option B N/A 12 1/2% of interest credited
on the unloaned accumulation
account during preceding
policy year.
SPLife - 2:
Option A 10 1/2% of single premium N/A
Option B N/A 7 1/2% of interest credited
on the unloaned accumulation
account during preceding
policy year.
____________________________________________________________________________________________________________________
OTHER PRODUCTS
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1st Policy 2nd Policy 3rd Policy
Year Year Year
---------- ---------- ----------
Modified Premium Whole
Life (MPWL) 200% 0% See Paragraph 3.
Flexible Premium Annuity 5.28% 5.28% 5.28%
____________________________________________________________________________________________________________________
________________________________________________________________________________
*POLICY FEES: Commissions are not payable on policy fees on these products.
** Years 2 through 7 only.
________________________________________________________________________________
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1. General COMPANY Rules:
A. Except for special rules set forth above for Option B on SPLife-1 and
SPLife-2, Commission rates are expressed as a percentage of premiums
received by the COMPANY.
B. Except as noted in paragraph 8, below commissions are payable only
when the policy has been issued, accepted by the applicant, and the
premiums have been received by UNITED INVESTORS LIFE.
C. Commission rates on riders and supplementary benefits shall be the
same as the rate for the base policy.
D. Commissions on the extra premium for substandard risks shall be at the
same rate as if the policy were issued on a standard basis; however,
no commissions shall be payable on temporary flat extra premium of
five years or less.
E. UNITED INVESTORS LIFE reserves the right to adjust commissions on any
specially designed product and with respect to any policy that is
reinsured with allowances other than those currently in effect with
the reinsuring company.
F. In the event an increasing option has been selected on VITALife
Adjustable and premium is received by UNITED INVESTORS LIFE on the
increased face amount, the COMPANY will pay the equivalent of a first
year commission rate on that portion of the premium that is
attributable to an increase in the face amount. Any such commission
payment shall be considered as renewal commission for all other
purposes.
2. COMPANY Rules Regarding VITALife III PLUS:
A. For commission purposes, re-entry is considered a new sale.
B. For purposes of renewal commissions, "Policy Years" are measured from
the original policy date.
C. First year and renewal commissions, including first year commissions
on re-entries, are vested for 10 years as measured from the original
policy date.
3. COMPANY Rules Regarding MPWL:
A. Commissions on MPWL are payable on the base premium only except where
the first year commissions exceeds the first year premium (base
premium plus additional first year premium), payment of that portion
of the commission that exceeds the first year premium will be deferred
and will be paid during the second policy year.
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B. Where the original primary writing agent is actively licensed with
UNITED renewal commissions on MPWL policies which are renewed into the
11th year are payable for the 11th year only and are payable at the
following rates depending upon the option selected by the insured:
MPWL = 200%, RT = 115%, and Whole Life = 115%. If a policy is
reassigned and a new MPWL application is submitted and approved for
standard issue, the normal lst year MPWL commission will be paid.
C. Replacement of a COMPANY policy that has been in force less than one
year by an MPWL policy where:
(1) MPWL has a Smaller Face Amount - The normal first year commission
on the earlier policy will be paid. No first year commission
will be paid on the MPWL policy; however, 11th year renewal
commissions will be paid as provided above.
(2) MPWL has an Equal Fact Amount - Same as number 3c.(1), above.
(3) MPWL has a Larger Face Amount - The normal first year commission
on the earlier policy will be paid, plus a commission of 200% of
the premium for the increase in face amount. Normal MPWL 11th
year renewal commissions will be paid.
D. Replacement of COMPANY policy that has been in force more than one
year by an MPWL policy where:
(1) MPWL has a Smaller Face Amount - No commissions are payable on
the MPWL except 11th year commissions as provided above.
(2) MPWL has an Equal Face Amount - Same as number 3.D.(1), above.
(3) MPWL has a Larger Face Amount - Normal MPWL commissions payable,
except first year commission payable only on the premium
applicable to the increase in face amount of coverage.
4. If a policyholder elects the vanishing premium option on XLife 2, no
commission is payable while such option is in force.
5. The COMPANY may in accordance with the terms of your General Agent
Contract, at any time and from time to time modify this Commission
Schedule.
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6. REPLACEMENT OF AN EXISTING UNITED INVESTORS LIFE POLICY.
A. If the first year premium (less policy fee) is equal to or less than
the first year premium of the policy being replaced, YOU will receive
no first year commission. Renewal commissions will be as set forth
above.
B. If the first year premium (less policy fee) is greater than the first
year premium of the policy being replaced, YOU will receive a first
year commission at the rate for the commission on the new policy form,
on the increased premiums. Renewal commission will be set forth
above.
7. CONVERSIONS.
A. If a VITA Life III PLUS policy form is being converted to an XLife 1
or XLife 2, only renewal commissions on the new policy will be paid.
B. Conversion of other term products to XLife-1 will be treated as
replacement unless the total face amount of insurance in force with
the COMPANY after conversion is equal to or greater than the term
insurance coverage in effect with the COMPANY at any time within six
months prior to conversion. If any remaining term insurance policy
lapses within six months after conversion and a first year XLife-1
commission has been paid, the excess of the new first year commission
over the renewal commission that would have been paid will be charged
back.
C. If conversion does not fall within the exceptions set forth above,
full first year and renewal commissions will be paid on the new
policy.
8. COMMISSION ADVANCES.
A. If the General Agent pays advanced commission to the COMPANY'S
licensed agents, the COMPANY shall advance to the General Agent semi-
monthly the amount of the commission that the General Agent advances
to said agents for the same semi-monthly period.
B. As first year premiums are received by UNITED, for policies on which
advances have been made, commissions relating to that portion advanced
which would otherwise be payable to the General Agent, shall be
credited against such advances.
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[UNITED INVESTORS LIFE / XXXX X. XXXXXXXX LETTERHEAD]
Memorandum to: Xxxxx lady
Re: Commissions on New LifeTime Term Product
From: Xxxx Xxxxxxxx
Date: April 13, 1988
This memo is to confirm our discussion yesterday as to the commission
rates for the above referenced product. As I understand it the following rates
apply:
From W&R to
From UILIC ---------------------------
to W&R Specialist Sales Rep
---------- ---------- ---------
1st year 100% 50.0% 10.0%
years 2-10 10 2.5 2.5
years 11 & on 3
The split commissions shown are for sales by the insurance specialist to a
United Funds account owner. The sales rep to whom the account is assigned
receives the commission shown in the last column above. At the time we spoke
you were not certain of the level of commission to be paid to W&R sales reps
selling this product.
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