SELLING AND SERVICES AGREEMENT
FOR
INSURANCE AND ANNUITY (FIXED AND VARIABLE) PRODUCTS
THIS SELLING AND SERVICES AGREEMENT (this “Agreement”) is entered into
as of __________, 20___ (the “Effective Date”) by and between CMFG Life Insurance
Company, an Iowa insurance company, MEMBERS Life Insurance Company, an Iowa insurance
company (together, “CUNA Mutual”), CUNA Brokerage Services, Inc., a Wisconsin corporation
(“CUNA Brokerage”) and [____________________], a [___________] corporation, (“General
Agent” and “Broker Dealer”) with an address of [__________________________________].
WHEREAS, CUNA Mutual has the requisite authority to provide certain fixed insurance
policies and annuity contracts and variable life insurance policies and annuity contracts, some of
which are securities under the Securities Act of 1933, as amended;
WHEREAS, CUNA Mutual has appointed CUNA Brokerage, a registered broker-dealer
with the Securities and Exchange Commission (“SEC”) under the Securities Exchange Act of
1934, as amended (the “1934 Act”), and a member of the Financial Industry Regulatory
Authority (“FINRA”), as the principal underwriter and distributor of its variable life insurance
policies and annuity contracts;
WHEREAS, General Agent or Broker-Dealer, as the case may be, has the requisite
authority to solicit, sell and service fixed insurance policies and annuity contracts and variable
life insurance policies and annuity contracts contemplated under this Agreement and Broker-
Dealer is a registered broker-dealer with the SEC under the 1934 Act and a member of FINRA;
and
WHEREAS, CUNA Mutual and CUNA Brokerage desire to appoint and authorize, on a
non-exclusive basis, General Agent and Broker-Dealer to solicit, sell and service certain fixed
insurance policies and annuity contracts and variable life insurance policies and annuity contracts
(hereinafter collectively referred to as the “Products”), which are more fully described in the
Products and Compensation Schedule (the “Schedule”) attached hereto and incorporated herein,
and to have General Agent and Broker-Dealer provide certain administrative services as
described in this Agreement for purposes of soliciting, selling and servicing the Products; and
General Agent and Broker-Dealer desire to accept such appointment and authorization pursuant
to this Agreement. In the event General Agent and Broker-Dealer are the same entity, the term
“General Agent” in this Agreement shall refer to Broker-Dealer, which shall undertake all the
obligations and privileges of General Agent pursuant to this Agreement.
NOW, THEREFORE, in consideration of the mutual promises made herein, the parties
hereto agree as follows:
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1.Purpose of Agreement. The principal purpose of this Agreement is to set forth a selling
and service arrangement whereby CUNA Mutual and CUNA Brokerage will provide the
Products and appoint and authorize, on a non-exclusive basis, General Agent and Broker-Dealer,
and through General Agent’s and Broker-Dealer’s registered representatives (“Representatives”)
who are also licensed to sell insurance in appropriate jurisdictions and who are appointed by
CUNA Mutual to sell the Products, accept such appointment and authorization and will solicit,
sell and service the Products hereunder. Further, General Agent and Broker-Dealer will provide
certain administrative services pursuant to this Agreement for the purposes of soliciting, selling
and servicing the Products.
2.Roles and Responsibilities of CUNA Mutual and CUNA Brokerage.
2.1The Products. The Products issued by CUNA Mutual are described on the
Schedule. The attached Schedule may be amended from time-to-time by CUNA Mutual. Prior
versions of Products are included for servicing under this Agreement for prior customers by
Representatives who are now appointed as agents of CUNA Mutual through General Agent
under this Agreement. Any customer records and files relating to prior versions of the Products
shall be retained by the appropriate Representatives or by General Agent or Broker-Dealer and
shall be subject to the confidentiality provisions of Section 5 and record maintenance provisions
of Subsection 3.15 of this Agreement. Upon issuance of the Products pursuant to this
Agreement, CUNA Mutual will transmit Products to General Agent or Broker-Dealer for
delivery to policyholders according to procedures set up by CUNA Mutual, unless CUNA
Mutual has provided otherwise. CUNA Mutual, in its sole discretion and without notice to
Broker-Dealer, may suspend sales of any of the Products or may amend the Products if, in
CUNA Mutual’s opinion, such suspension or amendment is: (a) necessary for compliance with
federal, state, or local laws, regulations, or administrative orders; or (b) necessary to prevent
administrative or financial hardship to CUNA Mutual. In all other situations, CUNA Mutual
shall provide reasonable notice, as practicable, to Broker-Dealer prior to suspending sales of any
of the Products or amending the Products.
2.2.Appointment of General Agent and Authorization of Broker-Dealer. CUNA
Mutual hereby appoints and CUNA Brokerage hereby authorizes General Agent and Broker-
Dealer to solicit, sell and service the Products through its Representatives. General Agent and
Broker-Dealer shall be responsible for any appointment or renewal fees.
2.3Prospectuses. CUNA Mutual and CUNA Brokerage, at their own expense, will
provide Broker-Dealer with prospectuses and supplements thereto relating to the Products, and
such other materials as CUNA Mutual or CUNA Brokerage, in its sole discretion, deems
necessary or appropriate for use in connection with the issuance and sale of the Products. Upon
termination of this Agreement or upon request by CUNA Mutual or CUNA Brokerage, Broker-
Dealer shall promptly return all such prospectuses, supplements and other materials to CUNA
Mutual or CUNA Brokerage free from any claim or retention rights by Broker-Dealer.
2.4Sales and Promotion Material. CUNA Mutual and CUNA Brokerage, at their
expense and as deemed necessary at their discretion, may provide sales and promotion materials
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relating to the Products for use by General Agent and Broker-Dealer. Upon termination of this
Agreement, General Agent and Broker-Dealer shall promptly return or destroy all such sales and
promotion materials and advertising relating to the Products to CUNA Mutual or CUNA
Brokerage pursuant to Subsection 7.3 hereof.
2.5Compensation.
(a)CUNA Mutual or CUNA Brokerage shall pay “Compensation,” as more
fully described in the Schedule, semi-monthly to General Agent and/or Broker-Dealer based
upon the Products sold by General Agent and/or Broker-Dealer during the term of this
Agreement. CUNA Mutual and CUNA Brokerage reserve the right, upon at least thirty (30)
days prior written notice to General Agent and Broker-Dealer, to change the Compensation on
the Schedule. Any such change shall constitute an amendment to the Schedule and shall apply to
Compensation due on applications of the Products received by CUNA Mutual after the effective
date of such amendment. Notwithstanding the foregoing, in the event General Agent or Broker-
Dealer or any Representative of General Agent or Broker-Dealer shall at any time induce or
endeavor to induce any policyholders to relinquish the Products, except under circumstances
where there is reasonable grounds for believing that a particular policy or contract is not suitable
for a customer, any and all Compensation due General Agent and Broker-Dealer hereunder shall
cease and terminate. Except as expressly set forth herein and the Schedule, no compensation
other than that shown on the Schedule shall be paid or payable by CUNA Mutual or CUNA
Brokerage to General Agent or Broker-Dealer in connection with the offer and sale of the
Products.
(b)General Agent, CUNA Mutual and CUNA Brokerage acknowledge and
agree that certain Representatives, acting as agents of General Agent under this Agreement, may
elect to be paid by CUNA Mutual directly for fixed annuity products described on the Schedule
attached hereto. Such agents will be acting as independent agents under a separate independent
agent agreement executed between CUNA Mutual and said agents.
2.6Legal Compliance. CUNA Mutual and CUNA Brokerage will comply in all
material respects with all applicable insurance and securities laws and rules and regulations
thereunder, including the rules and regulations of federal and state authorities and self-regulatory
organizations that have jurisdiction over their activities described in this Agreement.
3.Roles and Responsibilities of General Agent and Broker-Dealer.
3.1Insurance Licensing. At all times while performing obligations under this
Agreement and at its own expense, General Agent, and General Agent’s Representatives, shall
be validly licensed, including fees related to license issue, transfer and termination, as an
insurance agency in the states and other local jurisdictions that require such licensing or
registration in connection with General Agent’s fixed and variable insurance sales activities, or
shall maintain a validly licensed insurance agency subsidiary in those states, if any, in which
General Agent cannot obtain a corporate agent’s license.
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3.2Securities Registration. At all times while Broker-Dealer is performing its
obligations under this Agreement, Broker-Dealer, at its own expense, shall be responsible for all
fees, including registration and examination fees, necessary in order to be registered as a
securities broker with the SEC and FINRA and shall generally maintain all licenses, registrations
and such other qualifications as may be necessary or required by applicable federal and state
laws, regulations or requirements of any self-regulating organization with respect to its activities
hereunder.
3.3Representatives. General Agent shall have sole responsibility for the training,
supervision and compliance with applicable insurance laws and regulations relating to
Representatives who are engaged directly or indirectly in soliciting, selling and servicing of the
Products. All such persons shall be subject to the control of Broker-Dealer with respect to such
persons’ securities regulated activities in connection with the Products, including, but not limited
to, training and compliance with applicable federal and state laws and regulations and
compliance with any supervisory responsibilities pursuant to applicable FINRA rules. General
Agent and Broker-Dealer shall be responsible for the selection of Representatives with the
requisite insurance licenses and securities registration under applicable federal, state, and local
laws, rules or regulations in order to engage in soliciting, selling and servicing the Products.
General Agent and Broker-Dealer will cause such Representatives to be trained in the selling of
the Products to ensure Representatives have thorough knowledge of the Products and the ability
to make appropriate product presentations and suitability determinations in compliance with
applicable law. Furthermore, General Agent and Broker-Dealer will ensure Representatives are
licensed and registered representatives of General Agent or Broker-Dealer, as the case may be,
and meet any other requirements or conditions of this Agreement before such Representatives
engage in the solicitation of applications for the Products, and General Agent and Broker-Dealer
will ensure that such Representatives maintain such licenses and registrations in accordance with
applicable laws and regulations. General Agent and Broker Dealer will be responsible for all
insurance and licensing fees for Representatives. Further, General Agent and Broker-Dealer will
cause such Representatives to limit solicitation of applications for the Products to jurisdictions
where CUNA Mutual or CUNA Brokerage has approved or authorized such solicitation.
General Agent and Broker-Dealer will cause such Representatives to comply with all applicable
administrative procedures of CUNA Mutual, including without limitation, any Code of Conduct
and/or Compliance Manual published by CUNA Mutual and provided to General Agent and
Broker-Dealer. Representatives’ qualifications shall be certified to the satisfaction of CUNA
Mutual and CUNA Brokerage, and General Agent or Broker-Dealer, as the case may be, shall
notify CUNA Mutual and CUNA Brokerage if any Representative ceases to be a registered
representative of Broker-Dealer or ceases to maintain the proper licensing required for selling the
Products and will act to terminate the sales activities of such Representative relating to the
Products.
3.4Appointment of Representatives. General Agent shall assist CUNA Mutual in
the appointment of Representatives under the applicable insurance laws to sell the Products.
General Agent agrees to fulfill all requirements set forth in the General Letter of
Recommendation, attached hereto as Exhibit A and fully incorporated herein, in conjunction
with the submission of licensing/appointment papers for all applicants as insurance agents of
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CUNA Mutual. All such licensing/appointment papers should be submitted to CUNA Mutual or
its duly appointed agent by General Agent. Notwithstanding such submission, CUNA Mutual
shall have sole discretion to appoint, refuse to appoint, discontinue, or terminate the appointment
of any Representative as an insurance agent of CUNA Mutual.
3.5Representatives’ Insurance Compliance. Prior to allowing Representatives to
solicit, sell or service the Products, General Agent shall require Representatives to be validly
insurance licensed, registered and appointed by CUNA Mutual as an agent in accordance with
the jurisdictional requirements of the place where the solicitations, sales or service take place as
well as the solicited person’s or entity’s place of residence.
3.6 Compliance with FINRA Rules of Conduct and Federal and State Securities
and Insurance Laws.
(a) Broker-Dealer shall fully comply and shall cause Representatives to fully
comply with the requirements of FINRA and of the 1934 Act and all other applicable securities
and insurance federal, state or local laws, rules and regulations. Further, General Agent and
Broker-Dealer will establish rules and procedures as may be necessary consistent with applicable
laws and regulations to provide diligent supervision of the securities and insurance sales
activities of Representatives. Upon request by CUNA Mutual or CUNA Brokerage, General
Agent and Broker-Dealer shall promptly furnish any records deemed necessary to establish such
diligent supervision.
(b)Broker-Dealer represents and warrants that during the term of this
Agreement, it will maintain and implement: i) policies and procedures designed to comply with
all applicable rules of FINRA, including but not limited to rules relating to suitability of variable
annuity and variable universal life recommendations; ii) a training program for Representatives
designed to ensure that Representatives gather information concerning a customer’s financial
status, tax status, investment objective and other relevant information prior to recommending the
purchase or exchange of a variable annuity or variable universal life contract; and iii) a
reasonable system of sales supervision designed to achieve compliance with FINRA rules. Upon
request by CUNA Mutual, Broker-Dealer agrees to complete an annual suitability review
certification and to provide a report to CUNA Mutual certifying that Broker-Dealer is in
compliance with the said activities listed above. Such reports shall be certified by a senior
manager of Broker-Dealer who has responsibility for such activities. Broker-Dealer
acknowledges and agrees that CUNA Mutual and/or CUNA Brokerage may conduct an
inspection and/or audit of Broker-Dealer on a periodic basis to ensure compliance with the stated
activities above, and Broker-Dealer agrees to make reasonable accommodation to CUNA Mutual
to enable CUNA Mutual to inspect documents and records Broker-Dealer is responsible to
maintain that are directly related to the sale and suitability of any CUNA Mutual variable annuity
and variable universal life products.
3.7 Compliance with Administrative Procedures. General Agent and Broker-
Dealer shall fully comply and shall cause Representatives to fully comply with the administrative
procedures of CUNA Mutual relating to the Products and the policies and procedures adopted by
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CUNA Mutual relating to privacy, agent conduct and similar matters to the extent such policies
and procedures are applicable to the soliciting, sale and servicing of the Products, as those
administrative procedures and other policies and procedures are now in effect or may be
amended or established in the future by CUNA Mutual in its sole discretion and communicated
to General Agent and Broker-Dealer, as appropriate.
3.8Compliance With Prospectuses. General Agent and Broker-Dealer shall comply
with the terms of any prospectus (and supplements thereto) for a Product. Without limiting the
generality of the foregoing, General Agent and Broker-Dealer shall offer the Products only at the
public offering price disclosed in the prospectus. In this regard, General Agent and Broker-
Dealer agree that Broker-Dealer shall be responsible for determining if, and calculating the
amount of, any waiver or reduction in sales charges is applicable to any prospective purchaser of
a Product and indicating such information on the application for the Product. In addition,
without limiting the generality of the foregoing, General Agent and Broker-Dealer understand
and acknowledge that the Products are not suitable for offer or sale in connection with any so-
called “market-timing” program, plan, arrangement or service of General Agent or Broker-
Dealer or any Representative. General Agent and Broker-Dealer shall not knowingly solicit,
offer, or sell Products for use in connection with any so-called “market-timing” program, plan,
arrangement or service and shall provide reasonable assistance to CUNA Mutual and CUNA
Brokerage in preventing the Products from being used for “market-timing” activity.
3.9Delivery of Prospectuses and Use of Sales Materials. Broker-Dealer agrees to
deliver prospectuses, prospectus supplements, and other sales and promotion materials for the
Products to purchasers and prospective purchasers of the Products in a timely manner and in
accordance with all applicable laws and regulations. General Agent, Broker-Dealer and their
agents shall not use any sales and promotion materials or any advertisements that they may
create relating to the Products, CUNA Mutual or CUNA Brokerage, unless CUNA Mutual or
CUNA Brokerage approve such materials and advertisements in writing prior to use. However,
this limitation shall not prevent General Agent and Broker-Dealer from advertising insurance
products in general, provided such advertising does not reference the Products, CUNA Mutual,
CUNA Brokerage, or any affiliated person of CUNA Mutual or CUNA Brokerage.
3.10Notice of Representative’s Noncompliance. In the event a Representative fails
or refuses to submit to supervision of General Agent and Broker-Dealer, ceases to be a registered
representative of Broker-Dealer or otherwise fails to meet the rules and standards imposed by
General Agent and Broker-Dealer on Representatives, General Agent and Broker-Dealer, as the
case may be, shall immediately advise CUNA Mutual and CUNA Brokerage of this fact and
shall immediately notify such Representative that s/he is no longer authorized to sell the
Products. General Agent or Broker-Dealer shall take whatever additional action may be
necessary to terminate the selling and service activities of such Representative relating to the
Products, which shall include, but not be limited to, acquiring all the customer records and files
of the Representative relating to the Products. General Agent and Broker-Dealer agree to retain
such customer records as required by applicable federal or state laws and regulations and to
provide access to such records as CUNA Mutual or CUNA Brokerage may reasonably request.
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3.11Compensation to Representatives. CUNA Mutual or CUNA Brokerage shall
pay Compensation to General Agent and Broker-Dealer pursuant to the Schedule. General
Agent and Broker-Dealer will be solely responsible for any compensation payable to
Representatives or any other persons associated with General Agent and Broker-Dealer relating
to the Products hereunder in accordance with applicable laws and regulations. Except as
necessary to meet legal requirements or subject to the provisions as set forth in Subsection 2.5(b)
of this Agreement, CUNA Mutual or CUNA Brokerage will not be responsible for any
compensation payable to Representatives or agents of General Agent and Broker-Dealer.
3.12Handling of Applications. CUNA Mutual shall supply Product application
forms for General Agent’s and Broker-Dealer’s use. All payments collected by General Agent or
Broker-Dealer or Representatives of General Agent and Broker-Dealer will be promptly remitted
in full, along with such application forms and any other required documentation, directly to
CUNA Mutual at the address indicated on such application or to such other address as CUNA
Mutual designates in writing. General Agent and Broker-Dealer are responsible for reviewing all
such applications for completeness and correctness, as well as compliance with suitability
standards of all applicable federal and state laws, rules and regulations and SEC and FINRA
requirements. Payments for the Products shall be made by check, bank wire transfer or other
forms of payment deemed acceptable by CUNA Mutual and allowable under applicable laws or
regulations and shall be drawn to the order of “MEMBERS Life Insurance Company” or “CMFG
Life Insurance Company.” General Agent and Broker-Dealer do not have any authority to
deposit or endorse checks payable to CUNA Mutual without the prior written approval of CUNA
Mutual. All applications are subject to acceptance or rejection by CUNA Mutual in its sole
discretion. CUNA Mutual may require that any medical examination made in conjunction with
an application for a Product be made by a medical examiner approved by CUNA Mutual and
CUNA Mutual shall pay only those fees in connection with medical examinations that have been
expressly authorized by it. All records or information obtained hereunder by General Agent or
Broker-Dealer shall not be disclosed or used except as expressly authorized herein and pursuant
to Section 5 hereof, and General Agent and Broker-Dealer will keep confidential such records
and information, which will only be disclosed as authorized or if expressly required by federal or
state regulatory authorities. General Agent and Broker-Dealer, in submitting applications for the
Products, will be deemed to have warranted to CUNA Mutual and CUNA Brokerage that
General Agent or Broker-Dealer, as the case may be, has made a determination of suitability
based on information concerning the prospective purchaser’s insurance and investment
objectives, risk tolerance, need for liquidity, and financial and insurance situation and needs, or
on such other factors that General Agent or Broker-Dealer deems to be appropriate under the
circumstances and in compliance with applicable laws and regulations. General Agent and
Broker-Dealer will not, directly or indirectly, expend or contract for the expenditure of any funds
of CUNA Mutual or CUNA Brokerage and CUNA Mutual and CUNA Brokerage will not be
obligated to pay any expense incurred by General Agent or Broker-Dealer in the performance of
this Agreement, unless otherwise provided for in this Agreement or agreed to in advance in
writing by CUNA Mutual or CUNA Brokerage.
3.13Transmission and Ownership of Money for Products. All money received by
General Agent and Broker-Dealer or Representatives or agents of General Agent and Broker-
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Dealer in connection with the Products, whether as premium or otherwise, and whether paid by
or on behalf of any policyholder, contract owner or anyone else having an interest in the
Products, is the property of CUNA Mutual, shall be held in a separate account and shall be
transmitted promptly in accordance with the administrative procedures of CUNA Mutual without
any deduction or offset for any reason, including but not limited to, any deduction or offset for
Compensation claimed by General Agent or Broker-Dealer.
3.14Delivery of Products. Upon issuance of the Products by CUNA Mutual pursuant
to this Agreement, CUNA Mutual will transmit Products to purchasers, as long as the
representative or agent of General Agent and/or Broker Dealer indicates on each application that
CUNA Mutual is requested to deliver said transmission to the purchaser, all in accordance with
procedures established by CUNA Mutual, unless CUNA Mutual has provided otherwise. CUNA
Mutual will transmit a copy of the data page to Representatives of General Agent or Broker-
Dealer upon issuance of the Products.
3.15Books, Accounts and Records. General Agent and Broker-Dealer will maintain
all books, accounts, and records as required by applicable laws and regulations. The books,
accounts and records of General Agent and Broker-Dealer shall be kept in good order and clearly
and accurately disclose the nature and details of transactions relating to the Products and General
Agent’s and Broker-Dealer’s activities related thereto. General Agent and Broker-Dealer shall
keep confidential all information obtained pursuant to this Agreement, including, but not limited
to, names of policyholders, and shall disclose such information only if CUNA Mutual or CUNA
Brokerage has authorized such disclosure in writing, or if such disclosure is expressly required
by applicable federal or state authorities. CUNA Mutual and CUNA Brokerage shall have
prompt and full access to all books, accounts and records of General Agent and Broker-Dealer
pertaining to the Products. General Agent and Broker-Dealer agrees to permit CUNA Mutual
and CUNA Brokerage representatives to enter into all areas of the General Agent’s and Broker-
Dealer’s business related hereto for the purpose of conducting inspections and General Agent
and Broker-Dealer shall fully cooperate with such representatives during such inspections by
rendering assistance as CUNA Mutual and CUNA Brokerage may reasonably request. Upon
notice from CUNA Mutual or CUNA Brokerage, and without limiting other rights of CUNA
Mutual and CUNA Brokerage under this Agreement, General Agent and Broker-Dealer shall
take certain steps as may be necessary to correct any deficiencies detected during such
inspections. Each party hereto agrees to promptly furnish any reports and information which a
party hereto may request in order to meet its reporting and record keeping obligations under the
state insurance laws and the federal and state securities laws or rules of FINRA and to provide
such books and records to the regulatory and administrative agencies which have jurisdiction
over CUNA Mutual or CUNA Brokerage.
3.16Customer File and Record Retention. For a period of six (6) years from the
termination date of this Agreement, General Agent and Broker-Dealer agree (a) to permit CUNA
Brokerage or CUNA Mutual access to inspect and copy, during normal business hours, books
and records, including but not limited to customer files relating to the Products under this
Agreement that are specifically required to be maintained by the rules and regulations
promulgated by the SEC, FINRA, or any other federal or state regulatory agency with
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jurisdiction over CUNA Brokerage, CUNA Mutual, Broker-Dealer or General Agent in
connection with an audit or investigation, including any such files as may have been requested
by such regulatory agencies (“Required Files) and (b) to maintain such Required Files in the
form originally received. In addition, this information will be made available to CUNA
Brokerage or CUNA Mutual in the event an individual customer complaint or class action is
submitted relating to activity between customer and CUNA Brokerage or CUNA Mutual so that
CUNA Brokerage or CUNA Mutual, as the case may be, may respond to such complaint. This
information will be provided immediately to CUNA Brokerage or CUNA Mutual for such
inspections and proof of the regulatory request and/or customer complaint. Within ninety (90)
days following termination, General Agent and Broker-Dealer shall deliver to CUNA Brokerage
or CUNA Mutual the following materials maintained by General Agent and Broker-Dealer or
Representatives: sales and promotion material, correspondence, customer communications,
including all communications relating to customer complaints, and records relating to inspections
conducted by any regulatory agency or by personnel of CUNA Brokerage or CUNA Mutual.
This Subsection 3.16 shall survive termination of this Agreement.
3.17Notification of Disciplinary Proceedings and Customer Complaints. General
Agent and Broker-Dealer shall promptly notify CUNA Mutual and CUNA Brokerage of any
disciplinary proceedings or customer complaints against General Agent or Broker-Dealer, or any
Representatives or agents of General Agent and Broker-Dealer relating to the Products or any
threatened or filed arbitration action or civil litigation arising out of the solicitation, sale or
service of the Products. General Agent and Broker-Dealer shall fully and promptly cooperate
with CUNA Mutual and CUNA Brokerage in investigating and responding to any customer
complaint, attorney demand, or inquiry received from state insurance departments or other
regulatory agencies or legislative bodies, and in any settlement or trial of any actions arising out
of the conduct of business under this Agreement. No response by General Agent or Broker-
Dealer to an individual customer complaint involving a Product will be sent until it has been
approved by CUNA Mutual or CUNA Brokerage. Any response by General Agent or Broker-
Dealer to an individual customer complaint will be sent to CUNA Mutual and CUNA Brokerage
for approval not less than five (5) business days prior to it being sent to the customer, except if a
more prompt response is required, the proposed response may be communicated by telephone,
electronically, via facsimile or in person.
3.18Fidelity Bond and Errors and Omissions Insurance Coverages. General
Agent/Broker-Dealer agrees that all directors, officers, employees and Representatives of
General Agent/Broker-Dealer shall be covered by a blanket fidelity bond/crime insurance policy
issued by a reputable bonding company with a limit of not less than five hundred thousand
dollars ($500,000) each occurrence for loss of money, securities or property sustained by CUNA
Mutual or CUNA Brokerage resulting from theft or forgery committed by General Agent/
Broker-Dealer or Representatives. General Agent/Broker-Dealer further agrees to obtain and
maintain errors and omissions insurance in an amount of at least two million dollars ($2,000,000)
each claim with a two million dollar ($2,000,000) annual aggregate during the term of this
Agreement for General Agent/Broker-Dealer and Representatives. All said coverages above
shall be maintained by General Agent/Broker-Dealer at General Agent/Broker-Dealer’s expense.
CUNA Mutual may require evidence that all such coverages above are in force and are
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satisfactory, and ▇▇▇▇▇▇ Dealer shall give prompt written notice to CUNA Mutual of any notice
of cancellation or change of the coverages. General Agent/Broker-Dealer shall be solely
responsible for responding to customers and filing claims as may be necessary under this
Agreement and General Agent/Broker-Dealer is responsible for any out-of-pocket expenses
related to such claims. General Agent/Broker-Dealer hereby assigns to CUNA Mutual or CUNA
Brokerage, as the case may be, any proceeds received from the insurance companies to the extent
CUNA Mutual's or CUNA Brokerage’s loss is due to activities covered by said policies. If there
is any deficiency amount, whether due to a deductible or otherwise, General Agent/Broker-
Dealer shall promptly pay CUNA Mutual or CUNA Brokerage such amount on demand,
and General Agent/Broker-Dealer hereby indemnifies and holds CUNA Mutual and CUNA
Broker harmless from any such deficiency and from the costs of collection thereof, including
reasonable legal fees.
3.19Prohibited Acts. Nothing in this Agreement shall be construed as giving General
Agent and Broker-Dealer the right to incur any indebtedness or make contracts on behalf of
CUNA Mutual or CUNA Brokerage. General Agent and Broker-Dealer are not authorized to:
discharge, waive any forfeitures under or extend the time for making payment for the Products;
waive or modify any terms, conditions, or limitations of any policy or contract; pay any premium
or other payment on behalf of an purchaser of the Products; or enter into any court or regulatory
proceeding in the name of or on behalf of CUNA Mutual or CUNA Brokerage. General Agent
and Broker-Dealer hereby authorize CUNA Mutual and CUNA Brokerage to set off liabilities of
General Agent or Broker-Dealer, as the case may be, to CUNA Mutual and CUNA Brokerage
against any and all amounts otherwise payable to General Agent or Broker-Dealer by CUNA
Mutual or CUNA Brokerage.
4.Right of Rejection. General Agent, Broker-Dealer, CUNA Brokerage and/or CUNA
Mutual each in their sole discretion, may reject any applications or payments remitted by
Representatives through the General Agent or Broker-Dealer and may refund an applicant’s
payments to the applicant. Likewise, CUNA Mutual and CUNA Brokerage may, at any time for
any reason, reject any order from Product owner (whether transmitted by or through General
Agent or Broker-Dealer or otherwise) to transfer contract value from one investment option
under a Product to another. In the event such refunds are made and if General Agent or Broker-
Dealer has received Compensation based on an applicant’s payment that is refunded, General
Agent or Broker-Dealer shall promptly repay such Compensation to CUNA Mutual. If
repayment is not promptly made, CUNA Mutual may, at its sole option, deduct any amounts due
to General Agent or Broker-Dealer from future Compensation otherwise payable to General
Agent or Broker-Dealer. This Section 4 shall survive termination of this Agreement.
5.Sharing of Customer Information. The parties acknowledge and agree that it may be
necessary for the parties to share nonpublic personal information and other customer information
("Customer Information") with each other in order for each party to meet their obligations under
this Agreement. With respect to the sharing, use and protection of Customer Information, the
parties agree to the following:
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5.1Confidentiality and Restrictions on Redisclosure of Customer Information.
Each party agrees to hold in strict confidence Customer Information obtained from another party
during the term of this Agreement and any existing Customer Information received or obtained
prior to this Agreement. Each party agrees not to disclose Customer Information, in any form or
medium, to any affiliated or nonaffiliated person, firm or corporation except as necessary to
perform services under this Agreement or as may be required by law. The parties hereto
acknowledge and agree that disclosing Customer Information to effectuate, service or administer
a Customer transaction shall not be considered a breach of the confidentiality obligations created
hereunder. To the extent that a party contracts with a third party that obtains Customer
Information in order to provide services under this Agreement, that party agrees to obtain
contractual confidentiality protections to require the third party to hold Customer Information in
strict confidence and not disclose it to any person unless required by law. Upon termination of
this Agreement, General Agent and Broker-Dealer agree to maintain all Customer Information
relating to the Products pursuant to Subsection 3.14 hereof. Each party agrees to comply with
applicable privacy laws and regulations including, but not limited to, the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇
Act, Public Law 106-102 (1999) as set forth in 15 U.S.C.A. §6801, as amended and to comply
with applicable changes in such laws and regulations as these occur and become effective.
5.2Use of Customer Information. Each party agrees to use Customer Information
only to fulfill its obligations hereunder and not to use it for any other purpose.
5.3Obligation to Maintain Security Over Customer Information. Each party agrees
to implement and maintain reasonable and customary security measures to safeguard Customer
Information. Such measures shall include, but not be limited to, requiring employees who will have
access to such information to agree to the confidentiality requirements of this Subsection.
5.4Confidentiality Obligations Survive Termination of the Agreement. The
obligations of the parties set forth in this Section 5 shall survive the termination of this
Agreement.
6.Limitations. Only CUNA Mutual or CUNA Brokerage, and no other party, shall have
the authority on behalf of CUNA Mutual or CUNA Brokerage: (a) to make, alter, or discharge
any of the Policies issued by CUNA Mutual; (b) to waive any forfeiture; (c) to grant, permit or
extend the time for making any payments; (d) to guarantee earnings or rates; (e) to alter the
forms which CUNA Mutual or CUNA Brokerage may prescribe or substitute other forms in
place of those prescribed by CUNA Mutual or CUNA Brokerage; or (f) to enter into any
proceeding in a court of law or before a regulatory agency in the name of or on behalf of CUNA
Mutual or CUNA Brokerage.
7.Term and Termination.
7.1Term. This Agreement will commence on the Effective Date, and unless
terminated as provided herein, will continue in force indefinitely.
12
7.2Termination. Each party will have the right to terminate this Agreement: (a)
without cause, effective upon delivery of thirty (30) days’ written notice thereof to the other
party; (b) effective immediately upon delivery of written notice thereof to the other
party, in the event that the other party is in breach of any material obligation herein; (c) effective
immediately in the event that either CUNA Brokerage or Broker-Dealer shall cease to be
registered broker-dealers under the 1934 Act and members of the FINRA; (d) effective
immediately, if General Agent or Broker-Dealer or any Representative of General Agent or
Broker-Dealer shall rebate or offer to rebate all or any part of a premium on any Products issued
by CUNA Mutual in violation of applicable federal, state or local securities and insurance laws,
rules or regulations; and (e) effective immediately if General Agent or Broker-Dealer or any
Representative of General Agent or Broker-Dealer shall withhold any premium on any policy
issued by CUNA Mutual.
7.3Effect of Termination. Upon termination of this Agreement, all Compensation
to the General Agent and Broker-Dealer hereunder shall cease; however, General Agent and
Broker-Dealer shall continue to be liable for any chargebacks or for any other amounts advanced
by or otherwise due CUNA Mutual or CUNA Brokerage hereunder. General Agent and Broker-
Dealer will immediately return or destroy, as instructed by CUNA Mutual and CUNA
Brokerage, all of CUNA Mutual’s and CUNA Brokerage’s proprietary materials, and any copies
thereof, including but not limited to, information and data relating to the Products, procedures
and practices, sales and promotion materials, advertising, information and materials relating to
“Systems,” as described hereinafter, and any sales and promotion materials created by General
Agent or Broker-Dealer related to the Products, and any copies thereof; and General Agent and
Broker-Dealer shall not use the same thereafter. General Agent and Broker-Dealer agree to
retain all customer files and records pursuant to Subsection 3.15 hereof.
8.Use of Technology.
8.1Generally. CUNA Mutual agrees to provide General Agent and Broker-Dealer
access to and the right to use those technology-based systems and materials (collectively, the
“Systems”) that CUNA Mutual determines to be reasonably required for General Agent’s or
Broker-Dealer’s performance of its obligations under this Agreement. Said access may be
provided through software provided by CUNA Mutual directly to General Agent or Broker-
Dealer and/or via the Internet. Upon delivery of any such software, CUNA Mutual shall be
deemed to grant to General Agent and Broker-Dealer a non-transferable, non-exclusive, license
to use the software within the scope of their responsibilities under this Agreement and for no
other purpose. The access and use rights to the Systems granted hereunder shall apply only to
the version of the Systems CUNA Mutual makes available to General Agent or Broker-Dealer
from time to time. General Agent and Broker-Dealer shall not reproduce, display, modify or
distribute the Systems or any part thereof, or use said Systems for any purpose outside the scope
of General Agent’s and Broker-Dealer’s responsibilities under this Agreement. General Agent
and Broker-Dealer shall not provide access to the Systems, nor to any software provided to
General Agent and Broker-Dealer by CUNA Mutual, in whole or in part, to any third party
including any consultant or contractor, without the express written permission of CUNA Mutual,
obtained in each instance in advance. General Agent and Broker-Dealer shall hold in strict
confidence, use only within the scope of their responsibilities under this Agreement, not provide
13
access to any third parties, any passwords or other authentication or security procedures or
devices provided to General Agent or Broker-Dealer to access and/or use the Systems. Upon
termination of this Agreement, General Agent and Broker-Dealer shall return all copies of the
software or other indicia of the Systems in its possession and retain nothing. Furthermore,
General Agent and Broker-Dealer will ensure that Representatives under this Agreement will
abide by the provisions of this Section 8.
8.2Disclaimer. CUNA MUTUAL PROVIDES THE SYSTEMS, SOFTWARE
AND ANY INFORMATION STORED OR PROCESSED ON SAID SYSTEMS AND
SOFTWARE “AS IS,” AND EXPRESSLY DISCLAIMS ALL WARRANTIES EXPRESS OR
IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE. General Agent and Broker-Dealer understand
and agree that the Systems and software contain trade secrets and proprietary data of CUNA
Mutual and that the Systems and software are and shall at all times remain the sole and exclusive
property of CUNA Mutual. This provision shall survive termination of this Agreement.
8.3Limited Liability. In no event to the maximum extent permitted by law shall
CUNA Mutual be liable for any special, indirect, incidental, or consequential damage (including,
without limitation, damages for loss of business, profits or income) arising out access, lack of
access, use or lack of use of the Systems or software, even if CUNA Mutual has been advised of
the possibility of such damages. Further, in no event to the maximum extent permitted by law
shall CUNA Mutual be liable to General Agent or Broker-Dealer for damages of any kind or
nature arising from the access, lack of access, use, or lack of use of the Systems or software to
the extent said damages exceed the Compensation that CUNA Mutual has paid to General Agent
and Broker-Dealer under this Agreement during the three (3) month period immediately
preceding the occurrence of the claim.
9.Confidentiality and Trade Secrets. All information or materials relating to or prepared
by a party to this Agreement which are obtained or reviewed in any inspection or through the
course of business during the term of this Agreement, including but not limited to, CUNA
Mutual’s insurance policy information, coverage plan and rates and CUNA Mutual’s or CUNA
Brokerage’s policies and procedures, practices, billing information, claims information, business
relationship information, statistical data, and any other know-how and information, shall be held
in strict confidence by the parties hereto. No party shall permit any third party to copy, review or
use the other party’s confidential or proprietary materials at any time. CUNA Mutual and
CUNA Brokerage shall have sole and exclusive ownership of all right, title and interest in “Trade
Secrets” and Broker-Dealer shall obtain no such rights hereunder. “Trade Secrets” shall be
defined as a whole or any portion thereof of any business, sales or legal information, process,
procedure, know-how that provides a party with a significant competitive advantage in the
development, construction, conduct, operation, control, marketing, sale, management,
administration, maintenance or servicing of insurance, or financial products. This provision shall
survive the termination of this Agreement.
10.Representations and Warranties
14
10.1 General Representations and Warranties. Each party represents and warrants to
the others that:
(a) It is duly organized, validly existing and in good standing under the laws of
the state of its organization and has all the requisite power, corporate or otherwise, to carry on its
business as now being conducted and to perform its obligations as contemplated by this
Agreement;
(b) It has all licenses, approvals, permits and authorizations of, and registrations
with, all authorities and agencies, including non-government self-regulatory bodies, required
under federal, state and local laws and regulations to enabled it to perform its obligations under
this Agreement; and
(c) The execution, delivery and performance of this Agreement have been duly
and validly authorized by all necessary “corporate” action, and this Agreement constitutes the
legal, valid and binding agreement of such party, enforceable against it according to its terms,
except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium, or
other similar laws relating to creditors’ rights generally and general principles of equity.
10.2 Broker-Dealer Representations and Warranties. CUNA Brokerage and Broker-
Dealer each represent and warrant to the other that it is registered as a broker-dealer with SEC
under the 1934 Act and is a member in good standing of FINRA.
11.Mutual Indemnification.
11.1 General Agent and Broker-Dealer Indemnification. General Agent and Broker-
Dealer, jointly and severally, will indemnify, defend and hold harmless CUNA Mutual and
CUNA Brokerage and their respective affiliates, officers, directors, employees and agents from
and against any claim, loss, damage, expense or liability, judgment, settlements or regulatory
actions, including defense costs, reasonable attorneys’ fees, penalties and fines, arising from, or
in any manner relating to: (a) any breach of any covenant or obligation pursuant to this
Agreement, including, but not limited to, any applicable law or regulation, or any applicable rule
of any self-regulatory organization by General Agent and Broker-Dealer or their Representatives
and agents; (b) any criminal, fraudulent or intentionally wrongful act or omission committed by
General Agent or Broker-Dealer or their Representatives and agents in connection with the
performance of General Agent’s or Broker-Dealer’s obligations hereunder; or (c) the
infringement, violation or misappropriation by General Agent or Broker-Dealer or their
Representatives and agents of any party’s rights with respect to any Trade Secrets, copyright,
trademark, service mark, tradename or similar proprietary rights conferred by common law, state
law or by any law of the United States arising out of or resulting from the performance of
General Agent’s or Broker-Dealer’s obligations under this Agreement.
11.2 CUNA Mutual and CUNA Brokerage Indemnification. CUNA Mutual and
CUNA Brokerage, jointly and severally, will indemnify, defend and hold harmless General
Agent and Broker-Dealer and their respective affiliates, officers, directors, employees and agents
15
from and against any claim, loss, damage, expense or liability, judgment, settlements or
regulatory actions, including defense costs, reasonable attorneys’ fees, penalties and fines,
arising from, or in any manner relating to: (a) any breach of any covenant or obligation pursuant
to this Agreement, including, but not limited to, any applicable law or regulation, or any
applicable rule of any self-regulatory organization by CUNA Mutual or CUNA Brokerage; or (b)
any criminal, fraudulent or intentionally wrongful act or omission committed by CUNA Mutual
or CUNA Brokerage in connection with the performance of CUNA Mutual’s or CUNA
Brokerage’s obligations hereunder.
11.3 Survival. This Section 11 shall survive termination of this Agreement.
12.General Compliance. The parties hereto agree to comply with the existing laws and
rules or regulations of applicable local, state or federal regulatory authorities, including, but not
limited to, FINRA, SEC, Financial Crimes Enforcement Network and the New York Stock
Exchange, and with those which may be enacted or adopted during the term of this Agreement
regulating the business conducted under this Agreement and in any jurisdiction in which the
business described herein is to be transacted, and to provide information or reports relating to the
respective duties and obligations hereunder pursuant to requests by any regulatory authority
having jurisdiction with respect thereto.
13.Anti-Money Laundering Compliance Program. The parties hereto acknowledge and
agree that insurance agencies and securities broker-dealers are subject to certain regulations set
forth under the Bank Secrecy Act (the “BSA”) and §352 of the USA PATRIOT Act (the
“PATRIOT Act”) related to adopting and implementing an anti-money laundering compliance
program (“AML Program”). Each party hereto represents and warrants that it has effectively
implemented a written AML Program. General Agent and Broker-Dealer each hereby represents
and warrants that its AML program includes, at a minimum: a) incorporating policies, procedures
and internal controls reasonably designed to assure compliance with BSA and the PATRIOT
Act; b) designating a compliance officer responsible for day-to-day compliance with the BSA
and the AML Program; c) providing education and/or training of Representatives and other
appropriate personnel concerning their responsibilities under the AML Program, including
training in the detection of suspicious transactions; and d) providing for independent review to
monitor and maintain an adequate AML Program. The parties agree that CUNA Mutual and
CUNA Brokerage have the right, upon reasonable request, to examine the description of the
training provided to Representatives to ensure that the AML Program of General Agent and/or
Broker-Dealer provides adequate training for Representatives. In the event General Agent and/or
Broker-Dealer or Representatives become aware of circumstances related to a customer that may
be suspicious, General Agent, Broker-Dealer or Representative, as the case may be, agrees to
promptly notify the Anti-Money Laundering Officer at CUNA Mutual regarding such suspicious
activity. Furthermore, the parties represent and warrant that each has adopted and will continue
to execute a customer identification program (the “CIP”) meeting the requirements under the
PATRIOT Act. The parties agree that CUNA Mutual and CUNA Brokerage have the right, upon
reasonable request, to examine the description of the CIP that General Agent and/or Broker-
Dealer has adopted and implemented. The parties agree that CUNA Mutual and CUNA
16
Brokerage may require an annual certification relating to General Agent and/or Broker-Dealer’s
AML and CIP programs.
14.Notices. All notices, requests, demands and other communications required or permitted
under this Agreement shall be given in writing and shall be deemed to be given upon receipt of
any of the following delivery methods: (a) personally delivered; or (b) sent by telecopier,
facsimile transmission or other electronic transmission; or (c) sent by United States certified or
registered mail, postage prepaid, return receipt requested; or (d) sent by private overnight courier
service. The respective addresses to be used for all notices, requests, demands or
communications are as follows:
CMFG Life Insurance Company
Attn: Annuity Product Management
2000 Heritage Way
Waverly, IA 50677
CUNA Brokerage Services, Inc.
Attn: Annuity Product Management
2000 Heritage Way
Waverly, IA 50677
Broker-Dealer:
General Agent:
15.Independent Contractors. The relationship between the parties hereto is an
independent relationship and each party has sole responsibility and authority for the conduct of
its own business. General Agent and Broker-Dealer and their Representatives and their agents
are independent contractors with respect to CUNA Mutual and CUNA Brokerage. No party
hereto has the right to bind the other party in any way.
16.Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Wisconsin.
17.Waiver. A waiver by any party of any terms and conditions of this Agreement in any
one instance shall not be deemed or construed to be a waiver of any such term or condition for
the future, or of any subsequent breach thereof, nor shall it be deemed a waiver of performance
of any obligation hereunder.
18.Severability. If any portion or provision of this Agreement is held to be invalid or
unenforceable, the remainder of this Agreement shall continue in full force and effect.
17
19.Assignment. This Agreement shall be binding on and shall inure to the benefit of the
parties hereto and their respective successors and assigns; and no party may assign rights or
obligations under this Agreement without the prior written consent of the other party.
20.Headings. The headings in this Agreement are solely for convenience of reference and
shall not be given any effect in the construction or interpretation of this Agreement.
21.Amendment. CUNA Mutual and CUNA Brokerage reserve the right to amend this
Agreement at any time, and the submission of an application by General Agent or Broker-Dealer
after notice of any such amendment has been sent to General Agent and Broker-Dealer shall
constitute that General Agent and Broker-Dealer are in agreement to any such amendment.
22.Entire Agreement. This Agreement and any attachments hereto constitute the entire
understanding of the parties hereto relating to the subject matter hereof and supersedes in its
entirety all prior agreements between CUNA Mutual and CUNA Brokerage and General Agent
or Broker-Dealer, if any, all prior and collateral agreements, understandings, statements and
negotiations of the parties relating to such subject matter.
23.Counterparts. This Agreement may be executed in counterparts and all documents so
executed shall constitute one agreement binding on the parties hereto.
[The remainder of this page is intentionally left blank.
Signatures appear on the following page.]
18
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first set forth above.
CMFG Life Insurance Company
Name:
Title:
By: __________________________________
Name:
Title:
By: __________________________________
CUNA Brokerage Services, Inc.
Name:
Title:
By: __________________________________
Broker-Dealer
Name:
Title:
By: __________________________________
General Agent
Name:
Title:
By: __________________________________
NOTE: Please return two signed copies of this Agreement to:
CMFG Life Insurance Company
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇, HW PROD
2000 Heritage Way
Waverly, IA 50677
Upon acceptance, one countersigned copy will be returned to General Agent/Broker-Dealer for
its files.
19
20
Exhibit A
FOR
INSURANCE AND ANNUITY (FIXED AND VARIABLE) PRODUCTS
GENERAL LETTER OF RECOMMENDATION
General Agent and Broker-Dealer hereby certify to CUNA Mutual that all the following
requirements will be fulfilled in conjunction with the submission by General Agent or Broker-
Dealer of licensing/appointment papers for all applicants as agents of CUNA Mutual. General
Agent or Broker-Dealer will, upon request, forward proof of compliance with same to CUNA
Mutual in a timely manner.
1.We have made a thorough and diligent inquiry and investigation relative to each applicant's
identity, residence, business reputation, and experience and declare that each applicant is
personally known to us, has been examined by us, is known to be of good moral character,
has a good business reputation, is reliable, is financially responsible and is worthy of a
license and appointment as an agent of CUNA Mutual. This inquiry and background
investigation has included a credit and criminal check on each applicant, which will be made
available to CUNA Mutual within twenty-four (24) hours, upon written request. Based upon
our investigation, we vouch and certify that each individual is not a “prohibited person” per
18 U.S.C. 1033 and is trustworthy, competent and qualified to act as an agent for CUNA
Mutual to hold himself/herself out in good faith to the general public.
2.We have on file appropriate state insurance department licensing forms or a Form U-4 which
was completed by each applicant. We have fulfilled all the necessary investigative
requirements for the registration of each applicant as a registered representative through our
FINRA member firm, and each applicant is presently registered as a FINRA registered
representative. The above information in our files indicates no fact or condition which would
disqualify the applicant from receiving a license or appointment and all the findings of all
investigative information is favorable.
3.We certify that all educational requirements have been met for the specific state each
applicant is licensed in, and that all such persons have fulfilled the appropriate examination,
education and training requirements as of the date the appointment takes effect.
4.We certify that each applicant will receive close and adequate supervision, and that we will
make inspection when needed of any or all risks written by these applicants, to the end that
the insurance interest of the public will be properly protected.
5.We will not permit any applicant to transact insurance as an agent until duly licensed therefor
and appointed by CUNA Mutual. No applicants have been given a contract or furnished
supplies, nor have any applicants been permitted to write, solicit business, or act as an agent
21
in any capacity, and they will not be so permitted until the certificate of authority or license
applied for is received.
PRODUCTS AND COMPENSATION SCHEDULE This Products and Compensation Schedule (this “Schedule”) is incorporated into the Selling and Services Agreement (the “Agreement”) as of the Effective Date of the Agreement. CUNA Mutual agrees to compensate General Agent and Broker-Dealer, as appropriate, under the Agreement as set forth below. Notwithstanding any provisions in the Agreement to the contrary, CUNA Mutual reserves the right to discontinue the availability of any of the Products or modify the Compensation at any time, subject to thirty (30) days written notice. Subject to the provisions of the Agreement, General Agent and Broker-Dealer shall be entitled to receive the Compensation for the Products listed in this Schedule. Capitalized terms in this Schedule and not otherwise defined herein will have the meanings set forth in the Agreement. |
For each product sale or transaction the following rules apply:
•For proprietary insurance products, First Year and Renewal Commission are expressed as a percentage of
premiums by year. Note that for proprietary life insurance products, First Year Commission is calculated based
on net annualized first year premium, and Renewal Commission is calculated as a percentage of renewal
premium paid by the purchaser. For annuity products, First Year Commission is calculated as a percentage of
earned premiums, and Renewal Commission is calculated as a percentage of trailers. A trailer is defined as the
annuity contract account value at the end of the annuity contract anniversary.
•For the Single Premium Immediate Annuity, commission charge backs will be made when death of the client
occurs prior to the income payment start date. The charge back will be 100% of the commission if death of the
client occurred in the first six months after issue, or 50% of the commission if death of the client occurred in
months seven through twelve after issue.
•For proprietary single life and joint life income options, First Year Commission is expressed as a percentage
of the amount applied to the income option on the contract. First Year Commission is calculated for the service
representative at the time proceeds are applied to:
a)All variable single life and joint life income options
b)All fixed non-dividend based single life and joint life income options
•Income option trailers are expressed as a percent of the reserve held by CUNA Mutual on the contract and are
paid once per year in January to the representative assigned for service as of the prior year-end calculation date
on contracts in force for all fixed period income options.
•In addition, several special Compensation rules apply to the Products sold as part of this Agreement:
1.CUNA Mutual has the right to define and determine compensation on transfers, exchanges, or
replacements.
1.CUNA Mutual reserves the right to refund premium paid or principal invested on a policy if such
refund is justified by reason of rescission or cancellation for justifiable reason. In this situation,
compensation will be adjusted for any refunded premium or investment.
2.For proprietary insurance products, First Year Commission is credited when the policy is issued and
the premium is fully processed by CUNA Mutual, and Renewal Commission is credited when the
premium is received and fully processed by CUNA Mutual.
3.Increases to premium level and specified amount may result in compensation being credited to another
representative. In addition, changes in service assignments or in a sales and service agreement may
result in compensation being credited to another representative.
4.The minimum disbursed commissions check amount will be $50. Any payable amounts below the
minimum in a given period will be held over and disbursed in a subsequent period.
22
5.With respect to annuity products, CUNA Mutual reserves the right to reverse compensation upon the
death of the owner or annuitant within the first year after issuance of the policy.
PRODUCTS AND COMPENSATION SCHEDULE
COMMISSION RATE | ||||||
PRODUCT | YEAR | FIRST YEAR | RENEWAL | |||
LIFE INSURANCE | ||||||
MEMBERS Whole Life Primary Protection Plan: | ||||||
% of premium | 1 | 96.00% | ||||
% of premium | 2-3 | 10.00% | ||||
% of premium | 4-10 | 5.00% | ||||
TERM INSURANCE | ||||||
MEMBERS Elite Protection Term Series: | ||||||
Level 10, 15 | ||||||
% of premium | 1 | 80.00% | ||||
% of premium | 2-10 | 2.00% | ||||
Level 20 | ||||||
% of premium | 1 | 92.00% | ||||
% of premium | 2-10 | 2.00% | ||||
Level 30 | ||||||
% of premium | 1 | 98.00% | ||||
% of premium | 2-10 | 2.00% | ||||
FIXED ANNUITY | ||||||
MEMBERS Select Fixed ▇▇▇▇▇▇▇ ▇▇: | ||||||
Under $250,000 | ||||||
% of premium; issue ages 0-75 | 1 | 4.00% | ||||
% of premium; issue ages 76-80 | 1 | 3.10% | ||||
% of premium; issue ages 81-90 | 1 | 2.20% | ||||
$250,000 and above | ||||||
% of premium; issue ages 0-75 | 1 | 3.35% | ||||
% of premium; issue ages 76-80 | 1 | 2.65% | ||||
% of premium; issue ages 81-90 | 1 | 1.85% | ||||
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PRODUCTS AND COMPENSATION SCHEDULE
COMMISSION RATE | ||||
PRODUCT | YEAR | FIRST YEAR | RENEWAL | |
MEMBERS Focus ▇▇▇▇▇ ▇▇▇▇▇▇▇: | ||||
Option 1 - Under $500,000 | ||||
4 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 2.00% | ||
4 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 1.40% | ||
5 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 2.50% | ||
5 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 1.75% | ||
6 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 3.00% | ||
6 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 2.10% | ||
Option 1 - $500,000-$999,999 | ||||
4 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.30% | ||
4 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.90% | ||
5 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.90% | ||
5 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 1.35% | ||
6 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 2.30% | ||
6 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 1.60% | ||
Option 1 - $1,000,000 + | ||||
4 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.05% | ||
4 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.70% | ||
5 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.50% | ||
5 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 1.10% | ||
6 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.85% | ||
6 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 1.30% | ||
Option 2 - Under $500,000 | ||||
4 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 0.75% | ||
4 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.55% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
5 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.25% | ||
5 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.90% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
6 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.75% | ||
6 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 1.25% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
Option 2 - $500,000-$999,999 | ||||
4 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 0.25% | ||
4 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.25% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
5 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 0.65% | ||
5 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.50% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
6 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 1.00% | ||
6 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.75% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
Option 2 - $1,000,000 + | ||||
4 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 0.20% | ||
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COMMISSION RATE | ||||
PRODUCT | YEAR | FIRST YEAR | RENEWAL | |
4 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.20% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
5 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 0.50% | ||
5 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.40% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
6 Yr Rate Guarantee - % of premium; issue ages 0-75 | 1 | 0.80% | ||
6 Yr Rate Guarantee - % of premium; issue ages 76-90 | 1 | 0.60% | ||
Trailer; paid qtrly, starts at the end of the 5th qtr | 0.063% | |||
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PRODUCTS AND COMPENSATION SCHEDULE
COMMISSION RATE | |||||
PRODUCT | YEAR | FIRST YEAR | RENEWAL | ||
SINGLE PREMIUM IMMEDIATE ANNUITY | |||||
MEMBERS SPIA: | |||||
Life Income Option | |||||
% of premium; issue ages 0-70 | 1 | 4.25% | |||
% of premium; issue ages 71-80 | 1 | 3.40% | |||
% of premium; issue ages 81 + | 1 | 1.75% | |||
Installment Option | |||||
% of premium; all ages | 1 | 3.00% | |||
SINGLE PREMIUM DEFERRED INDEXED ANNUITY | |||||
MEMBERS Index Annuity – 5 Year: | |||||
Option 1 - Under $350,000 | |||||
% of premium; issue ages 0-75 | 1 | 4.00% | |||
% of premium; issue ages 76-85 | 1 | 2.60% | |||
Option 1 - $350,000 and above | |||||
% of premium; issue ages 0-75 | 1 | 3.40% | |||
% of premium; issue ages 76-85 | 1 | 2.20% | |||
Option 2 - Under $350,000 | |||||
% of premium; issue ages 0-75 | 1 | 3.00% | |||
% of premium; issue ages 76-85 | 1 | 2.00% | |||
Trailer | 0.25% | ||||
Option 2 - $350,000 and above | |||||
% of premium; issue ages 0-75 | 1 | 2.40% | |||
% of premium; issue ages 76-85 | 1 | 1.60% | |||
Trailer | 0.25% | ||||
MEMBERS Index Annuity – 7 & 10 Year: | |||||
Option 1 - Under $350,000 | |||||
% of premium; issue ages 0-75 | 1 | 5.00% | |||
% of premium; issue ages 76-85 | 1 | 3.25% | |||
Option 1 - $350,000 and above | |||||
% of premium; issue ages 0-75 | 1 | 4.25% | |||
% of premium; issue ages 76-85 | 1 | 2.75% | |||
Option 2 - Under $350,000 | |||||
% of premium; issue ages 0-75 | 1 | 4.00% | |||
% of premium; issue ages 76-85 | 1 | 2.60% | |||
Trailer | 0.25% | ||||
Option 2 - $350,000 and above | |||||
% of premium; issue ages 0-75 | 1 | 3.25% | |||
% of premium; issue ages 76-85 | 1 | 2.10% | |||
Trailer | 0.25% | ||||
MEMBERS Index Annuity – Re-Up Issue 5, 7 & 10 Year: | |||||
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COMMISSION RATE | |||||
PRODUCT | YEAR | FIRST YEAR | RENEWAL | ||
Under $350,000 | |||||
% of premium; attained ages 0-75 | 1 | 0.90% | |||
% of premium; attained ages 76-85 | 1 | 0.60% | |||
$350,000 and above | |||||
% of premium; attained ages 0-75 | 1 | 0.75% | |||
% of premium; attained ages 76-85 | 1 | 0.50% | |||
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PRODUCTS AND COMPENSATION SCHEDULE
COMMISSION RATE | ||||
PRODUCT | YEAR | FIRST YEAR | RENEWAL | |
MODIFIED GUARANTEED ANNUITY | ||||
MEMBERS Zone Annuity* | ||||
5-Year: | ||||
Option 1 | ||||
% of premium; issue ages 0-75 | 1 | 4.00% | ||
2+ | 0.00% | |||
% of premium; issue Ages 76-85 | 1 | 2.60% | ||
2+ | 0.00% | |||
Option 2 | ||||
% of premium; issue ages 0-75 | 1 | 0.65% | ||
2-5 | 0.163%/qtrly | |||
% of premium; issue Ages 76-85 | 1 | 0.65% | ||
2-5 | 0.163%/qtrly | |||
Option 3 | ||||
% of premium; issue ages 0-75 | 1 | 3.00% | ||
2-5 | 0.063%/qtrly | |||
% of premium; issue Ages 76-85 | 1 | 2.00% | ||
2-5 | 0.063%/qtrly | |||
7-Year and 10-Year: | ||||
Option 1 | ||||
% of premium; issue ages 0-75 | 1 | 5.00% | ||
2+ | 0.00% | |||
% of premium; issue ages 76-85 | 1 | 3.25% | ||
2+ | 0.00% | |||
Option 2 | ||||
% of premium; issue ages 0-75 | 1 | 0.65% | ||
2-7 or 2-10 | 0.163%/qtrly | |||
% of premium; issue Ages 76-85 | 1 | 0.65% | ||
2-7 or 2-10 | 0.163%/qtrly | |||
Option 3 | ||||
% of premium; issue ages 0-75 | 1 | 4.00% | ||
2-7 or 2-10 | 0.063%/qtrly | |||
% of premium; issue Ages 76-85 | 1 | 2.60% | ||
2-7 or 2-10 | 0.063%/qtrly | |||
DEFERRED INCOME ANNUITY | ||||
MEMBERS Future Income Annuity* | ||||
% of premium; issue ages 40-83 | 1 | 4.25% | ||
2+ | 0.00% | |||
28
*Compensation for this product subject to 100% reversal in case of insured’s death within 182 days from issuance of
contract, and 50% reversal in case of insured’s death within 183 – 365 days from issuance of contract.
29
PRODUCTS AND COMPENSATION SCHEDULE
COMMISSION RATE | |||||
PRODUCT | YEAR | FIRST YEAR | RENEWAL | ||
VARIABLE ANNUITY | |||||
MEMBERS Horizon B-Share: | |||||
% of premium; issue ages 21-75 | 1-5 | 5.00% | |||
6+ | 4.60% | ||||
% of premium; issue ages 76-85 | 1-5 | 3.25% | |||
6+ | 2.85% | ||||
Trailer; paid qtrly, starts at the end of the 21st qtr | 0.40% | ||||
MEMBERS Horizon C-Share: | |||||
% of premium; issue ages 21-85 | 1 | 1.25% | |||
2+ | 0.25% | ||||
Trailer; paid qtrly, starts at the end of the 5th qtr | 1.00% | ||||
30
PRODUCTS AND COMPENSATION SCHEDULE
COMMISSION RATE | |||
PRODUCT | YEAR | FIRST YEAR | RENEWAL |
INCOME OPTIONS | |||
Lifetime Payouts (MEMBERS Select ▇▇▇▇▇ ▇▇▇▇▇▇▇, MEMBERS Select ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, MEMBERS Focus ▇▇▇▇▇ ▇▇▇▇▇▇▇, MEMBERS Index Annuity, MEMBERS Zone Annuity, MEMBERS Choice Variable Annuity, MEMBERS Variable ▇▇▇▇▇▇▇ ▇▇, MEMBERS Variable ▇▇▇▇▇▇▇ ▇▇▇): | |||
% of premium; issue ages 0-70 | 1 | 0.00% | |
% of premium; issue ages 0-70 | 2 | 0.00% | |
% of premium; issue ages 0-70 | 3 | 0.90% | |
% of premium; issue ages 0-70 | 4 | 1.80% | |
% of premium; issue ages 0-70 | 5 | 2.50% | |
% of premium; issue ages 0-70 | 6 | 3.10% | |
% of premium; issue ages 0-70 | 7 | 3.70% | |
% of premium; issue ages 0-70 | 8+ | 4.00% | |
% of premium; issue ages 71-80 | 1 | 0.00% | |
% of premium; issue ages 71-80 | 2 | 0.00% | |
% of premium; issue ages 71-80 | 3 | 0.00% | |
% of premium; issue ages 71-80 | 4 | 0.95% | |
% of premium; issue ages 71-80 | 5 | 1.65% | |
% of premium; issue ages 71-80 | 6 | 2.25% | |
% of premium; issue ages 71-80 | 7 | 2.85% | |
% of premium; issue ages 71-80 | 8+ | 3.15% | |
% of premium; issue ages 81+ | 1 | 0.00% | |
% of premium; issue ages 81+ | 2 | 0.00% | |
% of premium; issue ages 81+ | 3 | 0.00% | |
% of premium; issue ages 81+ | 4 | 0.00% | |
% of premium; issue ages 81+ | 5 | 0.00% | |
% of premium; issue ages 81+ | 6 | ** | |
% of premium; issue ages 81+ | 7 | ** | |
% of premium; issue ages 81+ | 8+ | ** | |
Lifetime Payouts (all other products): | |||
% of premium; issue ages 0-81+ | 1+ | 0.00% | |
Installment Payments | |||
Fixed Period Income Options: | |||
Trailer; paid on a calendar year basis, based on the year- end value. | 0.225% | ||
**Commission rates vary by Annuity Mortality Tables. Please call Supplemental Contracts at ▇-▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇.
▇▇▇-▇▇▇▇ to obtain the commission rate.