1
EXHIBIT 10.12
SUB-AGENT AGREEMENT
(M.I.S. AND X'XXXX)
This Agreement is made between SCW AGENCY GROUP, INC. (hereafter SCW),
a Michigan corporation with home office at 0000 Xxxxxxxx Xxxx, Xxxxx 000, Xxxx
Xxxxxxx, Xxxxxxxx and Florida office at 000 XX Xxxxxx Xxxx., Xxxxx 000, Xxxx
Xxxxx, Xxxxxxx, and MANAGED INSURANCE SERVICES, INC. (hereafter Sub-Agent), a
Florida insurance agency with offices at 0000 X.X. 00xx Xxxxx, Xxxxxxx Xxxxx,
Xxxxxxx 00000.
RECITALS
A. SCW has been appointed by Mutual Insurance Corporation Of America
(hereafter MICOA) as an agent authorized to sell MICOA health care providers
professional liability insurance to Florida health care providers. Prior to
November 1, 1999, SCW's name was Xxxxxxxx, Xxxxxxxxx & Xxxxx, Inc.
B. Sub-Agent is an insurance agency which is duly licensed to sell
health care providers professional liability insurance in the State of Florida.
C. SCW and Sub-Agent wish to enter into this Agreement, under which
Sub-Agent will assist SCW in selling MICOA health care providers professional
liability insurance in the territory identified in this Agreement.
D. This Agreement must be approved by MICOA before it will become
effective.
NOW THEREFORE, SCW and Sub-Agent agree as follows:
1. Appointment as Agent. By its approval of this Agreement, MICOA
approves the appointment of Sub-Agent as an insurance agent authorized to sell
MICOA health care providers professional liability insurance in association with
SCW, as set forth in this Agreement.
2. Territory. The territory covered by this Agreement is the State of
Florida. Sub-Agent will not be an exclusive agent within this territory.
3. Working Relationship. The parties agree that Sub-Agent will work
with and through SCW, and SCW will pay Sub-Agent a portion of the commission SCW
receives on MICOA sales in the territory, as further provided below. Sub-Agent
will submit insurance applications directly to MICOA. Sub-Agent will not xxxx or
collect MICOA premiums, as those functions are performed by MICOA or by its
subsidiary, MICOA Management Company, Inc. (hereafter MMC).
2
4. Sub-Agent Responsibilities.
A. Sub-Agent will sell MICOA insurance in an ethical manner,
in compliance with all applicable laws and regulations, and in accordance with
MICOA procedures, directives, marketing programs, and instructions.
B. Sub-Agent will designate those individuals who will perform
services under this Agreement, and will obtain SCW's approval of such
individuals.
C. At the close of each business day, Sub-Agent will forward
all applications for MICOA coverage to MICOA for processing.
D. Sub-Agent will make its records pertaining to MICOA
business available for inspection at any reasonable time by a representative of
MICOA, MMC, or SCW.
E. Sub-Agent will not initiate advertising of any nature
concerning MICOA products without the prior approval of SCW and MICOA.
F. Sub-Agent will promptly report to MICOA all claims and
losses of which Sub-Agent has knowledge, and will properly notify MICOA when
Sub-Agent receives notice of the commencement of any related legal action.
Sub-Agent will refrain from admitting or denying liability on the part of MICOA
in connection with any claim or lawsuit.
G. All supplies, including standard forms and blank policies
furnished by MICOA and any copies or other reproductions of them, shall remain
the property of MICOA and shall be returned to MICOA or its representative upon
demand.
H. If Sub-Agent receives any payments on behalf of MICOA,
Sub-Agent will be deemed a trustee of MICOA in connection with such payments and
will promptly submit such money to MICOA.
I. Sub-Agent shall maintain errors and omissions insurance to
cover its own acts in performing under this Agreement, in an amount of not less
than $1,000,000, and shall provide proof of such coverage to SCW.
J. Sub-Agent agrees that it will not solicit or accept agent
of record letters for any business which is currently written by MICOA.
K. Sub-Agent will submit all new health providers professional
liability risks to MICOA first for its evaluation for underwriting, policy
issuance, and billing. Sub-Agent will also submit to MICOA first the renewal of
any risks already insured by MICOA. Upon declination by MICOA, Sub-Agent may
place the risk with other carriers. Sub-Agent may represent other insurance
companies, subject to the provisions of this paragraph.
2
3
5. SCW Responsibilities.
A. SCW will pay Sub-Agent the compensation provided in
paragraph 6 below on business produced and written by Sub-Agent in the territory
pursuant to this Agreement.
B. SCW will provide training, as necessary, in MICOA products
and procedures to the Sub-Agent's designated individuals.
C. SCW will provide consultation support to Sub-Agent, and
when requested will assist Sub-Agent with large accounts.
D. SCW will provide marketing support to Sub-Agent, which may
include physician lists and information concerning MICOA programs.
6. Compensation.
A. SCW will pay Sub-Agent commissions in accordance with the
attached Commission Schedule on premium reported and paid to MICOA on business
produced by Sub-Agent during the term of this Agreement. Sub-Agent agrees to
refund to SCW unearned commission on policy cancellations or reductions at the
same rate at which such commissions were originally paid.
B. SCW will pay Sub-Agent within 30 days after the end of the
month in which MICOA has received its premium payment for the business written,
subject to any deduction for return commissions due from Sub-Agent.
C. MICOA or SCW may revise the commission rate specified in
any commission schedule by giving Sub-Agent not less than 60 days' notice,
provided that such revision shall not apply to installment or endorsement
premiums payable on policies already in force.
D. MICOA has reserved the right to determine which agent will
receive credit for the sale in the event any conflicts arise between insurance
agents.
E. The commissions payable to Sub-Agent under this Agreement
will be for business produced by Sub-Agent, and not for any other business
written directly by MICOA or written by SCW or other agents or sub-agents.
7. Independent Contractor. Sub-Agent's performance under this Agreement
will be as an independent contractor. The compensation provided in this
Agreement shall be the sole compensation due Sub-Agent as a result of this
Agreement. Sub-Agent shall be responsible for its own expenses and liabilities
of doing business.
3
4
8. Ownership of Expirations.
A. In the event of termination of this Agreement, and provided
that Sub-Agent is not in default in any financial obligation due MICOA or SCW,
Sub-Agent's records and use and control of expirations shall remain Sub-Agent's
property. However, Sub-Agent agrees to offer to sell to MICOA Sub-Agent's
ownership interest in the expirations for the MICOA insurance produced by
Sub-Agent. The terms of such sale will be as negotiated and mutually agreed by
Sub-Agent and MICOA at such time.
B. If Sub-Agent is in default in any financial obligation due
MICOA or SCW, then the ownership of Sub-Agent's records and use and control of
expirations will rest with MICOA and SCW, and MICOA and SCW shall have the right
to make such use as they deem fit of Sub-Agent's records, the expirations, and
MICOA's own records. In the event of such default, MICOA and SCW shall have the
right without releasing Sub-Agent in any way, to communicate with insureds and
attempt to make collection directly of any premiums due or to become due.
9. Termination.
A. This Agreement may be terminated by SCW or Sub-Agent with
or without cause upon 60 days' written notice, and may be terminated by MICOA
with or without cause upon 90 days' written notice.
B. This Agreement will terminate immediately and automatically
if any public authority cancels or declines to renew Sub-Agent's license as an
insurance agency.
C. This Agreement will terminate immediately and automatically
if the agency agreement between MICOA and SCW is terminated.
D. This Agreement may be terminated immediately by SCW or
MICOA if Sub-Agent is delinquent in either accounting or payment of monies due
to MICOA, or in the event of gross or willful misconduct, fraud or material
misrepresentation.
10. Non-Solicitation Agreement
A. If this Agreement is terminated by SCW or MICOA under
paragraph 9.A. above, then for a two-year period following such termination SCW
will not directly or indirectly solicit, sell, or write health care providers
professional liability insurance for any MICOA insureds which were produced by
Sub-Agent and for which Sub-Agent has retained the expiration rights under
paragraph 8 above.
B. If this Agreement is terminated by Sub-Agent under
paragraph 9.A. above, then for a two-year period following such termination
Sub-Agent will not directly or indirectly solicit, sell, or write health care
providers professional liability insurance for any MICOA insureds
4
5
except those insureds which were produced by Sub-Agent and for which Sub-Agent
has retained the expiration rights under paragraph 8 above.
C. If either Sub-Agent or SCW does a broad solicitation which
incidentally includes some insureds covered by this Non-Solicitation Agreement,
but such solicitation is not targeted at such insureds, then this incidental
solicitation shall not be considered a violation of this Non-Solicitation
Agreement so long as insurance is not sold to such insureds either directly or
indirectly during the two-year period.
D. This Non-Solicitation Agreement does not affect any
separate agreement or obligation which either party may have to MICOA or MICOA
Management Company, Inc., including but not limited to the Employment Agreement
between Xxxxxx X. X'Xxxx and MICOA Management Company, Inc.
11. Assignment. Neither party may assign its rights or obligations
under this Agreement.
12. Florida Law. This Agreement shall be interpreted and enforced under
the laws of the State of Florida.
13. Binding Upon Principal. Xxxxxx X. X'Xxxx agrees that the provisions
of this Agreement will also be binding upon him in his individual capacity.
14. Entire Agreement. This Agreement constitutes the entire agreement
between SCW and Sub-Agent and supersedes any prior negotiations. Any amendment
to this Agreement must be in writing and signed by both SCW and Sub-Agent. This
Agreement does not supersede any agreements between Sub-Agent or Xxxxxx X.
X'Xxxx and MICOA or Xxxxxxxx-Xxxxxxxxx Management Company or their successors.
15. Effective Date. This Agreement shall not become effective until it
has been approved by MICOA. The effective date of this Agreement shall be the
date indicated next to the signature for the last entity whose approval is
needed.
SCW AGENCY GROUP, INC.
DATED: April 11, 2000 By: /s/ Xxxxxxxx X. Xxxxx
---------------------- ----------------------------------------
Its CEO
---------------------------------
Business Address:
0000 Xxxxxxxx Xxxx, Xxx. 000, X.X. Xxx 0000
Xxxx Xxxxxxx, Xxxxxxxx 00000-0000
5
6
MANAGED INSURANCE SERVICES, INC.
DATED: April 17, 2000 By: /s/ Xxxxxx X. X'Xxxx
-------------- ---------------------------------------
Its President
---------------------------------------
Business Address:
0000 Xxxxxxxxx 00xx Xxxxx
------------------------------------------
Xxxxxxx, XX 00000
------------------------------------------
------------------------------------------
and By: /s/ Xxxxxx X. X'Xxxx
---------------------------------------
Xxxxxx X. X'Xxxx, Individually
APPROVAL of this Agreement is hereby given on behalf of Mutual Insurance
Corporation Of America. Mutual Insurance Corporation Of America hereby
authorizes Managed Insurance Services, Inc. to act as its agent in accordance
with the terms of this Agreement.
DATED: May 4, 2000 By: /s/ Xxxxxxx X. Xxxxxx
---------------------- -------------------------------------
Its CMO
--------------------------------
Business Address:
0000 X. Xxxxxxxx Xxxx
X.X. Xxx 0000
Xxxx Xxxxxxx, XX 00000-0000
6
7
COMMISSION SCHEDULE
SCW Agency Group, Inc. (SCW) will pay Managed Insurance Services, Inc.
(Sub-Agent) the following commission on MICOA health care providers professional
liability insurance business produced by Sub-Agent pursuant to the Sub-Agent
Agreement between the parties:
New business 9% of the annual premium
Renewal business 9% of the annual premium
The above commission rates shall apply to insurance policies issued during the
term of the Sub-Agent Agreement with effective or anniversary dates after May 1,
2000.
7
