Sie sind auf Seite 1von 18

Schedule of

Compensation
For Managing General Agencies (MGA)
and National Accounts

Effective Date:
May 1, 2009
Wave 19

432E (2009/05/01)

TABLE OF CONTENTS

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
FIRST YEAR MGA COMPENSATION QUALIFICATION AND PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
COMPENSATION RATE TABLES FOR UNIVERSAL LIFE PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
SUPPLEMENTARY BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
DEFINITIONS FOR UNIVERSAL LIFE PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
CHARGEBACK RULES FOR UNIVERSAL LIFE PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
COMPENSATION RATE TABLES FOR TRADITIONAL LIFE AND CRITICAL ILLNESS PLANS . . . . . . . . . . . . . . . . . . . . . . . . .9
DEFINITIONS FOR TRADITIONAL LIFE AND CRITICAL ILLNESS PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
CHARGEBACK RULES FOR TRADITIONAL LIFE AND CRITICAL ILLNESS PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
COMPENSATION RATE TABLES FOR SINGLE PREMIUM IMMEDIATE ANNUITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
COMPENSATION RULES AND CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
1. INTERNAL REPLACEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
2. COMPLETE AND PARTIAL CONVERSIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
3. POLICIES ISSUED ON ADVISORS AND MEMBERS OF THE ADVISORS FAMILY . . . . . . . . . . . . . . . . . . . . . .14
4. JUMBO CASE RULES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
5. COMPENSATION ON REFUNDED PREMIUMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
6. REINSTATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
7. POLICY CHANGES AFTER ISSUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
8. SERVICE FEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
9. VESTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
10. CHARGEBACKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
11. CONTRACT OPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
12. MGA OF RECORD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
13. RETURN OF PREMIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
14. RETURN OF EXCESS OVERRIDE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
15. BUSINESS CONDUCT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

INTRODUCTION
BMO Life Assurance Company (BMO Insurance) is pleased to present you with a consolidated summary of the
compensation plans of our individual life and critical illness insurance portfolio. The schedule is an attachment to and
forms part of the Managing General Agency (MGA) Agreement and the National Account Agreement. (For the purposes
of this schedule, the terms "representative", "advisor" and "agent" are used interchangeably as are the terms
managing general agency, MGA and national account.)
This booklet contains information on compensation for the following plans:

Universal Life Insurance


Term Insurance
Permanent Insurance
Critical Illness
Single Premium Immediate Annuities

We have described the terms of the compensation schedules in an easy-to-understand format. If you have any
questions about the contents, please call the BMO Insurance Regional Sales Office closest to you.
The compensation schedules described in this Guide are for the insurance plans we offer for sale as of the
effective date of this Guide. Prior compensation schedules will continue to apply to policies (or coverages)
submitted at the time such prior schedules were in effect.
While we have made every effort to ensure the accuracy of the contents, we reserve the right to correct any
errors and/or omissions contained herein.
CHANGES EFFECTIVE
February 23, 2009
Revised Chargeback Rules for Universal Life Plans
Override Chargeback due to Reduction of Coverage
April 1, 2009
AIG Life Insurance Company of Canadas name was changed to BMO Life Assurance Company by Amended
Letters Patent, effective April 1, 2009.
May 1, 2009
Revised Advisor Commission Rate Table for Traditional Life and Critical Illness Plans
Preferred Term 20 FYC is changed
Revised Chargeback Rules for Universal Life Plans
Over Advanced FYO Recapture Credit
The Company reserves the right to modify this schedule when cases exceed specified limits or involve
Replacements or Conversions.

Table of Contents

FIRST YEAR MGA COMPENSATION


QUALIFICATION AND PAYMENTS
Life and Critical Illness Products
(Effective January 1, 2008)
FIRST YEAR OVERRIDE AS A PERCENTAGE OF THE ADVISORS FIRST YEAR COMMISSION
PRODUCTION LEVEL*
*Calendar Year Settled 1ST Year
Commissionable Target Premium

FIRST YEAR
OVERRIDE RATE

GROWTH
BONUS

MARKETING
ALLOWANCE

$249,999 or less
From $250,000 to $499,999
From $500,000 to $749,999
From $750,000 to $999,999
From $1,000,000 to $1,499,999
If $1,500,000 and over

190%

N/A

N/A

200%

N/A

N/A

205%

N/A

5%

207.5%

N/A

5%

210%

Up to 5%

5%

215%

Up to 5%

5%

Effective January 1st of each year, the MGA First Year Override Rate will be set at a rate of 190% if the MGAs prior
Calendar Year Settled 1st Year Commissionable Target Premium was less than $250,000. A rate of 200% will be set if
the MGAs prior Calendar Year Settled 1st Year Commissionable Target Premium was from $250,000 to $499,999, or a
rate of 205% if the MGAs prior Calendar Year Settled 1st Year Commissionable Target Premium was $500,000 or greater.
An annual payment will be made in January of the following year if the total Production Level achieved merits a First
Year Override Rate that exceeds the First Year Override Rate actually paid. The First Year Override percentage rate of
this payment will be the difference between the First Year Override Rate for which the MGA qualified and the First Year
Override Rate actually paid throughout the year. The annual payment will be calculated on the Net First Year
Commissions paid on policies sold by the MGAs advisors in the prior calendar year.
An annual payment representing Growth Bonus will be made in January of the following year when the MGAs Prior
Calendar Year Settled 1st Year Commissionable Target Premium was a minimum of $1,000,000 and exceeded the
previous year in excess of 10%. The Growth Bonus is calculated at a rate of 1% for each percentage of that growth
over 10% up to the Maximum based upon the MGAs Prior Calendar Year Settled 1st Year Commissionable Target
Premium. The annual payment will be calculated on the Net First Year Commissions paid on policies sold by the MGAs
advisors in the prior calendar year.
An annual Marketing Allowance will be established if the MGAs prior Calendar Year Settled 1st Year Commissionable
Target Premium is $500,000 or greater. The Marketing Allowance will be calculated on the Net First Year Commissions
paid on policies sold by the MGAs advisors in the calendar year. Payment of the Marketing Allowance must receive
prior approval of the expenditure by BMO Insurance Sales Management and submission of acceptable receipts.
Procedural details of acceptable expenditures and receipts will be sent annually to each MGA.

Table of Contents

COMPENSATION RATE TABLES FOR UNIVERSAL LIFE PLANS


FIRST YEAR OVERRIDE AS A PERCENTAGE OF THE REPRESENTATIVES FIRST YEAR COMMISSION
RENEWAL OVERRIDES AS A PERCENTAGE OF PREMIUM
Life Dimensions and Life Dimensions (Low Fees)
First Year1 Overrides

Renewal2 Overrides Years 2-5

Up to First Year
Commissionable
Target Premium

First Year
Commissionable
Target to First Year
Commissionable
Maximum Premium

Above First Year


Commissionable
Maximum Premium

190% - 215% ^

190% - 215% ^

190% - 215% ^

Up to First Year
Commissionable
Target Premium

First Year
Commissionable
Target to First Year
Commissionable
Maximum
Premium

Above First Year


Commissionable
Maximum Premium

Service
Fees
Years 6+

2.0%

nil

2.5%

2.5%

Asset Based
Compensation Years 6+
Indexed
Accounts

Daily
Interest and
GIA Accounts

0.125%

0.00%

Life Dimensions and Life Dimensions (Low Fees) with Fund Accelerator Investment Bonus
First Year1 Overrides

Renewal2 Overrides Years 2-5

Up to First Year
Commissionable
Target Premium

First Year
Commissionable
Target to First Year
Commissionable
Maximum Premium

Above First Year


Commissionable
Maximum Premium

190% - 215% ^

190% - 215% ^

190% - 215% ^

Up to First Year
Commissionable
Target Premium

First Year
Commissionable
Target to First Year
Commissionable
Maximum
Premium

Above First Year


Commissionable
Maximum Premium

Service
Fees
Years 6+

1.0%

nil

2.5%

First Year
Commissionable
Target to First Year
Commissionable
Maximum
Premium

Above First Year


Commissionable
Maximum Premium

Service
Fees
Years 6+

1.0%

nil

2.5%

First Year
Commissionable
Target to First Year
Commissionable
Maximum
Premium

Above First Year


Commissionable
Maximum Premium

Service
Fees
Years 6+

2.0%

nil

2.5%

2.5%

Asset Based
Compensation Years 6+
Indexed
Accounts

Daily
Interest and
GIA Accounts

0.125%

0.00%

Life DimensionsPRESTIGE and Life DimensionsPRESTIGE (Low Fees)


First Year1 Overrides
Up to First Year
Commissionable
Target Premium

190% - 215% ^

First Year
Commissionable
Target to First Year
Commissionable
Maximum Premium

Renewal2 Overrides Years 2-5


Above First Year
Commissionable
Maximum Premium

190% - 215% ^

190% - 215% ^

Up to First Year
Commissionable
Target Premium

1.0%

Asset Based
Compensation Years 6+
Indexed
Accounts

Daily
Interest and
GIA Accounts

0.125%

0.00%

LifeProvider and LifeProvider (Low Fees)


First Year1 Overrides
Up to First Year
Commissionable
Target Premium

190% - 215% ^

First Year
Commissionable
Target to First Year
Commissionable
Maximum Premium

Renewal2 Overrides Years 2-5


Above First Year
Commissionable
Maximum Premium

190% - 215% ^

190% - 215% ^

Up to First Year
Commissionable
Target Premium

2.5%

Asset Based
Compensation Years 6+
Indexed
Accounts

Daily
Interest and
GIA Accounts

0.125%

0.00%

Universal Life Investment Loan Plan


First Year1 Overrides
Up to
Minimum
Premium

Minimum
to 3 X
Minimum
Premium

3 X Minimum
Premium to
Maximum
Premium

190% - 215%^ 190% - 215% ^ 190% - 215%^

Renewal2 Overrides Years 2-5


Above
Maximum
Premium

190% - 215% ^

Up to First
Year
Minimum
Premium

First Year
Minimum to 3
X First Year
Minimum
Premium

3 X First Year
Minimum to
Maximum
Premium

2.5%

2.5%

2.5%

Above First
Year
Maximum
Premium

nil

Service Fees
Years 6+

2.5%

Asset Based
Compensation
Years 6+

0.125%

Table of Contents

SUPPLEMENTARY BENEFITS
The rate of first year override shown is applicable to the representatives first year commission for the
Supplementary Benefit; the renewal override rate is applicable to the annual premium of the Supplementary
Benefit.

First Year 1
Overrides

Renewal Overrides 2
Years 2- 5

Service Fees
Years 6+

Waiver of Premium

190% - 215% ^

2.5%

2.5%

Payor Waiver

190% - 215% ^

2.5%

2.5%

Accidental Death Benefit

190% - 215% ^

2.5%

2.5%

Childrens Term

190% - 215% ^

2.5%

2.5%

Ten or Twenty Year Renewable Term

190% - 215% ^

2.5%

2.5%

Additional Ten or Twenty Year Term

190% - 215% ^

2.5%

2.5%

190% - 215% ^

2.5%

2.5%

Critical Illness Rider - Living Benefit 10

190% - 215% ^

2.5%

2.5%

Critical Illness Rider - Living Benefit 20

190% - 215% ^

2.5%

2.5%

Critical Illness Rider - Living Benefit 75

190% - 215% ^

2.5%

2.5%

Critical Illness Rider - Living Benefit 100

190% - 215% ^

2.5%

2.5%

190% - 215% ^

2.5%

2.5%

nil

nil

nil

Business Guaranteed Insurability Rider (BGIO) 3

190% - 215% ^

2.5%

2.5%

LifeProvider Additional Coverage Rider 4

190% - 215% ^

2.5%

2.5%

Term 100 Rider

ART Rider

Joint Last-to-Die Conversion Rider

Notes:
1 Please refer to the Product Illustration System for First Year Commissionable Target and Commissionable Maximum Premiums. Policy changes
made after issue may result in recalculated First Year values.
2 Renewal Overrides are paid on New Deposits only.
3 BGIO Rider is available on Life Dimensions plans and Preferred Term 10 and 20 plans.
4 LifeProvider Additional Coverage Rider is only available on LifeProvider or LifeProvider (Low Fees) plans.
5 Term 100 Rider is not available on LifeProvider.
6 Renewal Override on the ART Rider will be paid as long as there is ART coverage in force, in years 2 to 5, and will be paid even if no new
deposits are made to the plan.
^ Refer to First Year MGA Compensation Qualification and Payments section of this Schedule.

Table of Contents

DEFINITIONS FOR UNIVERSAL LIFE PLANS


1.

Policy Year
First Policy Year is defined as the 12-month period commencing on the Policy Effective Date.
Subsequent Policy Years are defined as the anniversary dates commencing with the first day of the thirteenth
(13th) month after the Effective Date of the Policy.

2.

First Year Override (FYO) is calculated as a percentage of first year commission (FYC) paid during the First Policy Year
and is subject to a chargeback period (Please refer to Chargeback Rules for Universal Life Plans). FYO payments and
chargebacks follow all of the same rules as FYC transactions. For example:
FYC is advanced for the total Annual Planned Premium, which is based upon the deposit received by BMO
Insurance at the time the policy is settled (BMO Insurance reserves the right to pay FYC and FYO on an as
earned basis).
At the end of the First Policy Year, a Recapture of unearned advanced FYC and FYO is immediately applied
where the amount on which FYC and FYO was advanced is greater than the deposits actually received in the
First Policy Year.
Additional FYC and FYO will be paid on an as-earned basis when deposits are received in the First Policy Year in
excess of the Annual Planned Premium on which FYC and FYO was advanced.

3.

Commencing with the Second Policy Year, Renewal Override will be paid at the rates specified in each products
Compensation Rate Table. The rate is determined based upon the date the deposit is received at BMO Insurances
Head Office.
Renewal Override rates are based upon First Year Commissionable Target Premium and First Year
Commissionable Maximum Premium. (Note, for the Universal Life Investment Loan Plan renewal Override is
based on First Year Minimum Premium bands as defined in the Compensation Rate Table.)
Transfers to the Side Account and Deposits to the exempt portion of the policy transferred from the Side
Account will receive Override at the rate specified in each products Compensation Rate Table and based upon
the effective date of the deposit or transfer.

4.

Service Fees on Base Plans and Supplementary Benefits will be paid at the rate and duration specified in each
product's Commission Rate Table and will be paid on new deposits only up to an amount equal to the First Year
Minimum Premium.

5.

Asset Based Compensation (ABC) is paid monthly beginning in the 6th Policy Year (or as specified in each products
Compensation Rate Tables). ABC is not payable on amounts held in the Collateral Loan Account on the UL Investment
Loan Plan.
ABC is calculated at the end of each month beginning in the Policy Year stated for each UL product and is
based on the Fund Value of the policy. The amount payable each month is equal to [Fund Value x Rate] / 12

6.

For policies issued over Insurance Age 70, compensation is based on the age 70 premium.

7.

Compensation on Ratings:

FYO Rate in 1st Year

Reneual Override Rate


Years 2 - 5

Service Fee Rate


Years 6+

Premium on Flat Extras payable


for 5 years or less

0%

0%

0%

Premium on Flat Extras payable


for more than 5 years

Same Rate as
Base Plan

Same Rate as
Base Plan

0%

Table of Contents

CHARGEBACK RULES FOR UNIVERSAL LIFE PLANS


1.

FYO Recapture (First Year Unearned Advanced Override Recapture)


Any amount of FYO that was advanced but that has not been earned, due to non-payment of premium, will be
recovered in full at the first year anniversary.

2.

FYO Recovery at Second Year Anniversary


At the end of the 24th month, if the total of the deposits made (including transfers in from the Side Account) to
the exempt portion of the policy during the first 24 months, divided by two (2), is:
greater than or equal to the First Year Commissionable Target Premium, no First Year Override Recovery will
be applied.
less than the First Year Commissionable Target Premium or the Premium on which First Year Commission
was paid (whichever is less), a First Year Override Recovery will be applied. The amount of the First Year
Override Recovery will be calculated as follows:
the difference between the First Year Commissionable Target Premium paid and the total of the
commissionable premiums received in the first 24 months divided by two (2), times the applicable
First Year Override Rate listed in the Compensation Rate Tables for Universal Life Plans (Up to
Commissionable Target Premium).
Note: In the above definition, for the Universal Life Investment Loan Plan, First Year Minimum Premium and
First Year Maximum Premium are replaced by the terms First Year Commissionable Target Premium and
First Year Commissionable Maximum Premium.

3.

Over Advanced FYO Recapture Credit


At the end of the 24th month, for settled cases electing monthly deposits where deposits of at least 10 times the
initial monthly deposit (on which advanced FYO is calculated) are made in the first policy year, a comparison is
made between:
the sum of deposits made (including transfers in from the Side Account) to the exempt portion of the policy
from months 1 through 24 inclusive, divided by two (2), and,
to the sum of deposits made to the exempt portion of the policy from months 1 through 12 inclusive.
If the sum of deposits made in months 1 through 24, divided by 2, is equal to or greater than the sum of deposits
made in months 1 through 12, there is an Over Advanced FYO Recapture Credit payable on this difference to a
maximum of the amount of any applicable Over Advanced FYO Recapture.

4. Override Chargeback on Partial Cash Withdrawals


During the first two Policy Years, partial cash withdrawals from the policy are subject to a commission chargeback
based on the amount withdrawn using the following schedule:

Policy Years

Withdrawal Source

Chargeback Rate

1-2

Exempt Investments

10.5%

1-2

Side Account Investments

0.63%

Table of Contents

CHARGEBACK RULES FOR UNIVERSAL LIFE PLANS


5.

Override Chargeback due to Reduction of Coverage

Life Dimensions, LifeProvider and Universal Life Investment Loan Plan


If there is a request to reduce the Sum Insured or reduce the coverage provided by any Supplementary Benefit during
the chargeback period following the date of issue, a portion of the FYO paid on the amount of coverage subsequently
reduced will be charged back.
The amount charged back will equal the FYO paid multiplied by the percentage shown in the following table
(based on the number of completed months prior to the reduction of coverage) times the proportionate
reduction in the Sum Insured of the policy.
Completed Months

10

11

12
65

Override Chargeback (%)

100 100 100

100

100

100

95

90

85

80

75

70

Completed Months

13

14

15

16

17

18

19

20

21

22

23

24

Override Chargeback (%)

60

55

50

45

40

35

30

25

25

25

25

Life DimensionsPRESTIGE
If there is a request to reduce the Sum Insured or reduce the coverage provided by any Supplementary Benefit during
the chargeback period, the portion of the FYO charged back will be calculated as above, but will use the Life
DimensionsPRESTIGE table in section 6 below.
6.

Override Chargeback on Policy Lapse, Surrender or Premium Reduction due to other policy changes
If the policy and its associated supplementary benefits fail to remain in force for the full chargeback period
following the date of issue, a portion of the FYO will be charged back.
For a policy lapse, cancellation or surrender, the amount charged back will equal the FYO paid multiplied by
the percentage shown in the following table based on the number of completed months the policy
remained in force.
For policies that remain in force but where the premiums are reduced due to a change in smoking status, or
any other policy change, the amount charged will equal the difference between the FYO paid and the FYO
that would have been paid multiplied by the percentage shown in the following table based on the number
of completed months prior to the premium reduction.

Note: A chargeback is not applicable if the policy terminates due to payment of the death and/or critical illness
benefit.
Life DimensionsPRESTIGE
Completed Months

10

11

12

92.5

90

85

80

Override Chargeback (%)

100 100 100

100

100

100

100

Completed Months

13

14

15

16

17

18

19

20

21

22

23

24

25

77.5

75

72.5

70

67.5

65

62.5

60

57.5

55

52.5

50

47.5

Completed Months

26

27

28

29

30

31

32

33

34

35

36

37

Override Chargeback (%)

45

42.5

40

37.5

35

32.5

30

27.5

25

20

10

Override Chargeback (%)

97.5 95.0

All other Universal Life Plans and Supplementary Benefits


Completed Months

10

11

12
60

Override Chargeback (%)

100 100 100

100

100

95

90

85

80

75

70

65

Completed Months

13

14

15

16

17

18

19

20

21

22

23

24

Override Chargeback (%)

55

50

45

40

35

30

25

20

15

10

Table of Contents

COMPENSATION RATE TABLES FOR TRADITIONAL LIFE AND CRITICAL ILLNESS PLANS
FIRST YEAR OVERRIDE IS A PERCENTAGE OF THE REPRESENTATIVES FIRST YEAR COMMISSION.
RENEWAL OVERRIDES AND SERVICE FEES ARE A PERCENTAGE OF PREMIUM
Term Life
Renewal
Overrides
Years 2 - 5

FYO
Year 1
EasyTerm10
Preferred Term 10
Preferred Term 20
Preferred Term 30

190%
190%
190%
190%

215%^
215%^
215%^
215%^

2.0%
2.5%
2.5%
2.5%

Service Fees
Years 6 - 10
2.0%
2.5%
2.5%
2.5%

Years 11+

Years 21+

2.0%
2.5%
2.5%
2.5%

2.0%
2.5%
2.5%
2.5%

Years 11 - 20

Years 21+

Whole Life
FYO

Renewal
Overrides
Years 2 - 5

Year 1
20 Pay Life
Term 100 Platinum
Term 100 Plus
Pure Term 100

190%
190%
190%
190%

215%^
215%^
215%^
215%^

3.0%
2.5%
2.5%
2.5%

Service Fees
Years 6 - 10
3.0%
2.5%
2.5%
2.5%

3.0%
2.5%
0%
0%

0
2.5%
0%
0%

Critical Illness

Living Benefit 10*


Living Benefit 20*
*Conversion to T75
*Conversion to T100
Living Benefit 75
Living Benefit 100
15-Pay Living Benefit 100

FYO
Year 1
190% - 215%^
190% - 215%^

Renewal Overrides
Years 2 - 5
2.5%
2.5%

Service Fees
Years 6 - 10
2.5%
2.5%

190% - 215%^

2.5%

2.5%

2.5%

190% - 215%^
190% - 215%^

2.5%
2.5%

2.5%
2.5%

2.5%
2.5%

190% - 215%^

1.0%

1.0%

1.0%

Years 11+
2.5%
2.5%

Supplementary Benefits 1

Accidental Death Benefit


Waiver of Premium Benefit
Childrens Term Insurance Benefit
Term Insurance Rider(s) on WL plans
Critical Illness Rider(s) on Term Plans
Return of Premium Rider(s) on CI plans
Business Guaranteed Insurability
Option (BGIO) Rider2%
Notes:

FYO
Year 1
190% - 215%^

Renewal Overrides
Years 2 - 5
2.5%

Service Fees
Years 6+
0%

190% - 215%^
190% - 215%^
190% - 215%^

2.5%
2.5%
2.5%

0%
0%
2.5%

190% - 215%^
190% - 215%^

2.5%
2.5%

2.5%
0%

190% - 215%^

5.0%

0%

1 Supplementary Benefits are not available on Pure Term 100 policies at Issue Age/ESA 81-85.
2 BGIO Rider is available at issue on Life Dimensions plans and Preferred Term 10 and 20 plans.
^ Refer to First Year MGA Compensation Qualification and Payments section of this Schedule.

Table of Contents

DEFINITIONS FOR TRADITIONAL LIFE


AND CRITICAL ILLNESS PLANS
1. Policy Year
First Policy Year is defined as the 12-month period commencing on the Policy Effective Date.
Subsequent Policy Years are defined as the anniversary dates commencing with the first day of the
thirteenth (13th) month after the Effective Date of the Policy.
2. First Year Override (FYO) is calculated as a percentage of First Year Commission (FYC) paid during the first policy
year. FYC is advanced upon receipt of the first premium due and the policy is settled. (BMO Insurance reserves the
right to pay FYC and FYO on an as earned basis.) The FYC rate shown above is applicable to the annual premium
(including policy fee where applicable) for a policy without regard to the actual frequency or amount of premium
payment.
3. Commencing with the Second Policy Year, Renewal Override and Service Fees will be paid at the rates specified in
each products Compensation Rate Table.
Renewal Override and Service Fees will be paid on an as earned basis when premiums are received. The
Rates will be based on the modal premium, exclusive of compensation on temporary and permanent flat
extra premiums.
4. Compensation on Ratings

FYO Rate in
1st Year
Premium on Flat Extras payable
for 5 years or less
Premium on Flat Extras payable for
more than 5 years

Renewal Override Rate Service Fee Rate


Years 2 - 5
Years 6+

0%

0%

N/A

Same Rate as
Base Policy

Same Rate as
Base Policy

0%

10

Table of Contents

CHARGEBACK RULES FOR TRADITIONAL LIFE AND


CRITICAL ILLNESS PLANS
If a life and/or health policy (or coverage) and its associated supplementary benefits fail to remain in force for a full
24 months following the date of issue, a portion of the First Year Override (FYO) for the specific policy will be charged
back:
For any policy lapse, cancellation or surrender, the amount charged back will equal the FYO paid multiplied
by the percentage shown in the following table based on the number of completed months the policy
remained in force.
For policies that remain in force but where the premiums are reduced due to a reduction in face amount,
change in smoking status, or any other policy change, the amount charged will equal the difference
between the FYO paid and the FYO that would have been paid multiplied by the percentage shown in the
following table based on the number of months prior to the premium reduction.
Note: A chargeback is not applicable if the policy terminates due to payment of the death and/or critical illness
benefit.
Completed Months
Override Chargeback (%)
Completed Months
Override Chargeback (%)

100.00 95.83 91.37 87.50 83.33 79.17 75.00 70.83


13

14

15

16

17

18

19

20

45.83 41.67 37.50 33.33 29.17 25.00 20.83 16.67

11

10

11

12

66.67 62.5 58.33 54.17 50.00


21

22

12.50 8.33

23

24

4.17

0.00

Table of Contents

COMPENSATION RATE TABLES FOR SINGLE PREMIUM IMMEDIATE ANNUITIES


FIRST YEAR OVERRIDE IS A PERCENTAGE OF THE REPRESENTATIVES FIRST YEAR COMMISSION.
FYO
Life Annuities

15.0%

Term Certain Annuities

15.0%

12

Table of Contents

COMPENSATION RULES AND CONDITIONS


1.

INTERNAL REPLACEMENTS

When a new policy (or coverage) replaces an existing policy (or coverage), which was issued within the past 5 years
whether in force or lapsed, FYC and applicable FYO paid on the new policy (or coverage) will be reduced based on the
following table:
FYC on the new policy will be reduced by the
following percentage of the FYC credited to the
writing agent on the original policy (coverage):
100%
75%
50%
25%
0%

In force duration of policy being replaced


(based on the number of completed months
the policy remained in force)
0 24 months
25 36 months
37 48 months
49 60 months
61 months or more

With all internal replacements, the FYC and FYO will be reduced whether or not the original advisor is the writing
agent of the new policy.
Chargeback due to lapse will not be applied to the Replaced Policy, and the new policy will be subject to the
applicable Chargeback Schedule.
If the calculated FYC and FYO on the new policy results in a negative, the amounts owed will be applied to the writing
advisors commission account and the writing advisors MGAs override account respectively; renewal commission and
renewal override will be applied to the new policy for the First Policy Year.

2.

COMPLETE AND PARTIAL CONVERSIONS

A. BMO Insurance and former AIG Life of Canada (Life policies) to Eligible BMO Insurance Plans
FYC and FYO APPLIED TO NEW POLICY

CHARGEBACK ON CONVERTED POLICY

Applicable FYC and FYO of new plan applies

Applicable Lapse/Surrender Chargeback


Table applies

Eligible BMO Insurance Plans: Life Dimensions, 20 Pay Life, T100 Plus and T100 Platinum.
Note: LifeProvider and Pure Term 100 plans are not eligible conversion plans.
B.

Former Hartford Life Term Conversions to Eligible Conversion Plans: Whole Life or Endowment to 85
FIRST YEAR OVERRIDE

FYC APPLIED TO NEW POLICY

50% of premium, split evenly between the advisor and


the MGA, unless advised otherwise in advance by MGA

15% of premium to age 65 or for 10 years,


whichever is greater
C.

BMO Insurance (formerly AIG Assurance or Norwich Union) Term Conversions to Eligible BMO Insurance Plan
Whole Life Commission Rates
FYC

ELIGIBLE PLAN

30%
30%
30%

Term 100 Plus


Term 100 Platinum
20 Pay Life
13

Table of Contents

COMPENSATION RULES AND CONDITIONS


Universal Life Commission Rates
FYC - Tier 1*

ELIGIBLE PLAN

30%
30%
30%

Life Dimensions
Life DimensionsPRESTIGE
Universal Life Investment Loan Plan

*FYC - Tier 1 refers to the Commissionable Target Premium amount for FYC for Life Dimensions and Life
DimensionsPRESTIGE
*FYC - Tier 1 refers to Minimum Premium for Universal Life Investment Loan Plans
For details on other FYC levels, renewals, service fees, chargeback schedules, conditions and/or rules, please refer to the
applicable BMO Insurance Commission Schedules in effect at the time.
FYO will be applied according to the applicable Compensation Rate Table mentioned above.
3.

POLICIES ISSUED ON ADVISORS AND MEMBERS OF THE ADVISORS FAMILY

Definition: Family members of the advisor include, but are not limited to, spouse, children, siblings, parents or
dependents.
If the policy and its associated supplementary benefits fail to remain in force for the full chargeback period following
the date of issue, as shown in the following tables, a portion of the FYC and FYO will be charged back.
For a policy lapse, cancellation or surrender, the amount charged back will equal the FYC and FYO paid multiplied
by the percentage shown in the following table based on the number of completed months the policy remained
in force.
For policies that remain in force but the premiums are reduced due to a reduction in face amount, a change in
smoking status, or any other policy change, the amount charged will equal the difference between the FYC and
FYO paid and the FYC and FYO that would have been paid multiplied by the percentage shown in the following
table based on the number of months prior to the premium reduction.

4.

# OF COMPLETED MONTH POLICY IN-FORCE

CHARGE BACK RATE ON FYC and FYO

1 30
31 60

100%
50%

JUMBO CASE RULES

Large Commission Amounts


If
any single policy, or group of related policies, results in First Year Commission in excess of $10,000; or
at any time total compensation payable on a single policy, or group of related policies, exceeds $10,000
then,
BMO Insurance reserves the right to hold back any amounts in excess of the $10,000 or amounts unearned. This
includes applicable FYO. Such amounts held in reserve will be released according to an agreed upon schedule
for each case.
Large Face Amounts
BMO Insurance reserves the right to limit compensation on policies where the face amount exceeds specified limits.
14

Table of Contents

COMPENSATION RULES AND CONDITIONS


5.

COMPENSATION ON REFUNDED PREMIUMS


In all circumstances where premium is refunded, any compensation previously paid on that premium will be
reversed. This includes, but is not limited to, premium refund due to policy rescissions.

6.

REINSTATEMENTS
Commission will be paid based upon the premium submitted and applied to reinstate the policy.

7.

POLICY CHANGES AFTER ISSUE


Coverages/riders added after issue
FYC and FYO will be advanced at the rates applicable on the effective date of the additional coverage.
LifeProvider Additional Coverage Rider Exchange
Compensation will be paid on the new UL policy based upon the current duration of the LifeProvider Additional
Coverage Rider at the point of the exchange and at the applicable renewal commission and override rate of the
new plan.
Example: LifeProvider Additional Coverage Rider in force for 2 years at the time of the exchange,
compensation on the new policy will be paid at a renewal rate for 3 years.
ABC, where applicable, will commence with the 6th Policy Year of the new policy.

8.

SERVICE FEE
The MGA agrees to service directly, or through its Producers all of the insurance and/or annuity policies sold
through the MGA's Producers and acknowledges that payment of the Service Fee for subsequent years is
contingent upon the MGA appropriately servicing the policies.

9.

VESTING
First Year Override and Renewal Overrides (years 2 to 5) vest immediately. Service Fees (years 6+) vest
immediately subject to divesting pursuant to Section 8, Service Fee, above. Payment of Service Fees begins in
Year 6.

10. CHARGEBACKS
First year override paid to the MGA for insurance and/or annuity policies shall be subject to a chargeback to the
MGA's account for the number of months following the date of issue, as specified for that policy in its Schedules of
Compensation. If, during that period, a policy ceases to be in force, the amount of the chargeback depends on the
number of months that the policy has been in force and will be equal to that first year override multiplied by the
appropriate percentage detailed in its Schedule of Compensation.
The MGA agrees that any amounts charged back to him under this section shall be debt due BMO Insurance by the
MGA. The MGA agrees to repay those amounts in full to BMO Insurance upon demand.
First year commission paid to MGAs Producers for insurance policies shall be subject to a chargeback to the
Producers account for the number of months following the date of issue, as specified for that policy in its
Schedules of Compensation. If, during that period, a policy ceases to be in force, the amount of the chargeback
depends on the number of months that the policy has been in force and will be equal to that first year
commission multiplied by the appropriate percentage detailed in its Schedule of Compensation.
The MGA agrees that any amounts charged back to the MGAs Producers under this section shall be debt due BMO
Insurance by the MGA. The MGA agrees to repay those amounts in full to BMO Insurance upon demand.
The MGA acknowledges indebtedness to BMO Insurance for any amounts charged back to him under this section.
15

Table of Contents

COMPENSATION RULES AND CONDITIONS


11. CONTRACT OPTIONS
BMO Insurance reserves the right by giving 30 days written notice to the MGA to:
Establish minimum production, quality of production and persistency requirements to be met by the MGA, and
Change the "Schedule of Compensation" in whole or in part provided that such change will only apply to policies
solicited subsequent to the date that such notice is given.
Override for any policy plan not listed in its Schedule of Compensation shall be as determined by BMO Insurance.
12. MGA OF RECORD
The MGA's name appearing on the insurance application will be the only one to receive overrides or service fees on
that business. The MGA will not receive overrides or service fees on any business unless his name appears on the
insurance application.
13. RETURN OF PREMIUM
If BMO Insurance shall for any reason cancel an insurance policy and return the premium or premiums or any part
thereof, or if BMO Insurance shall return any premium or premiums or any part thereof paid in advance of the due
date thereof, the MGA shall pay to BMO Insurance on demand any credited override in respect of the amount returned.
14. RETURN OF EXCESS OVERRIDE
If any amount has been credited to the MGA in excess of the amount provided by the terms of this Agreement, such
excess amount shall constitute an indebtedness under this Agreement and the MGA shall repay such excess to BMO
Insurance on demand.
15. BUSINESS CONDUCT
An MGA is expected to conduct business in a manner that is compatible with the interests of BMO Insurance. Sales
practices that are not conducted in this manner may incur remedial action including chargebacks where appropriate.

16

Table of Contents

To find out more about BMO Insurance products, please contact the BMO Insurance regional sales office in
your area, call 1-877-742-5244 or visit www.bmoinsurance.com/advisor.

Ontario Region

Quebec Atlantic Region

Western Region

1-800-608-7303

1-866-217-0514

1-877-877-1272

BMO Life Assurance Company


60 Yonge Street, Toronto, ON M5E 1H5
1-877-742-5244
For MGA Use Only.
Insurer: BMO Life Assurance Company.
Registered trade-mark of Bank of Montreal, used under licence.

Table of Contents

Das könnte Ihnen auch gefallen