Common use of Initial Commission Clause in Contracts

Initial Commission. We will pay you initial commission on all business you introduce and that we accept, from the date the customer’s plan starts, or their cover is increased, provided premiums are paid unless your agency is cancelled or suspended. We may pay you initial commission on indemnity and/or non- indemnity terms at our discretion. We reserve the right to set a maximum ceiling on the amount of indemnity commission we pay you. We will be entitled to recover initial commission that we have overpaid, or clawback unearned initial commission, if: • the customer stops or reduces their premiums or chooses to remove their business from us, or the term of the business reduces while still in the initial period; • the customer exercises any option to change the cover under their plan while still in the initial period; • the customer cancels the plan in the cooling-off period; • we have paid the commission in error, or in breach of this agreement; • a plan lapses or is cancelled while still in the initial period; • we have reason to believe you or your employees, directors, officers, consultants, associates, including sub-agents are suspected of fraud, potential fraud or any unlawful act or any act which brings, or is likely to bring, either party into disrepute; • your agency is cancelled or suspended; • we are otherwise entitled to offset any clawback due to us against any payments due to you; or • the plan is voided due to the customer’s misrepresentation with a full refund of premiums given, whether inside or outside of the initial earning period. If there are no payments due to you, you agree to promptly repay us such overpaid or unearned commission. For any outstanding commission and costs due to us, we reserve the right to: • instruct lawyers to start proceedings to recover any debts due to us; • charge you interest on amounts you owe us if you do not pay within three months of us telling you about it. We will charge you interest from the date we told you about the amount you owe us, until the date you pay it. We will charge you interest at 3% above the base rate of the National Westminster Bank plc; • recover any costs of debt collection from you where applicable; and • recover any debts due to us using the personal guarantees in place. Where there is change of intermediary you agree that: • if the customer transfers a plan to another intermediary while still in the initial period, liability for any subsequent clawback will remain with you unless: – you agree to transfer entitlement to indemnity commission to the new intermediary; – they agree to be responsible for any clawback; – we agree to this transfer; and • if more than one claim for the same commission is made, we will pay commission to the intermediary who submitted the proposal to which the business relates. In the event of a dispute between two or more intermediaries in respect of commission, we shall have the discretion to determine who we pay the commission to. We agree to notify you when the customer has not paid a premium or