Exhibit 10.3
& American Home Assurance Company
Part 1: Agency consignment contract for insurance
against loss
Types of consignment insurance
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Consignment insurance type
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Consignment insurance
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1
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Fire insurance
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11
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Windstorm insurance
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2
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Automobile insurance
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12
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Machinery Breakdown Insurance
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3
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Accident insurance
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13
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Glass Insurance
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4
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Constructions Insurance
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14
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Labor disaster liability insurance
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5
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Theft insurance
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15
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Expense/Profit insurance
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6
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Warranty insurance
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16
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Warranty
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7
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Property insurance
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17
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Transport insurance
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8
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Liability insurance
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18
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Maritime insurance (hull insurance)
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9
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Aviation insurance
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19
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Maritime insurance (cargo insurance)
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10
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Credit insurance
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P.4
Article 8 (agency commission due date)
Monthly payment of agency commission should be made
before the end of the following month accounted for.
2. Post-factum agency commission should be paid
within 3 months from the end of business year.
3. If this contract becomes complete or cancelled,
unpaid agency commission should be paid within 3 months from the
date of completion or cancellation date.
Article 9 (agency commission rules)
The company sets an agency consignment rules on the
items in the contract, and reports the agency before the beginning
date of the insurance contract.
2. The company is able to change the agency
consignment rules by reporting the agencies in advance for
certified cases such as, addition of insurance types or any
movement in economical situation.
3. The company is able to set different agency
consignment rules according to the agency and insurance
types.
1
Article 10 (agency commission reduction)
The company can reduce the agency commission or
agency commission rate, if the agency concludes the insurance
contracts in special cases approved by the company or if the
company certifies that it is unsuitable to calculate agency
commission rates based on the agency consignment rules.
2. If the agencies does not execute commission
business themselves, and is acknowledged that it is unsuitable to
calculate agency commission rates based on the agency consignment
rules, and the company is able to reduce the agency commission
rate.
3. If the agency violates this contract, the company
is able to reduce or refuse to pay the agency commission for a
fixed period. However, this item does not apply if it is to be
punished based on article 35.
Article 11 (reversal of agency
commission)
If agency returns all or part of the premiums to the
insurance contractor due to changes in conditions or cancellation,
based on agency consignment rules, it is necessary to make
reversals to the company based on the total amount of agency
commission.
2. Even if the agency manages transfer contracts, if
agency returns all or part of the premiums to the insurance
contractor due to change in conditions or cancellation, based on
the agency consignment rules, it is necessary to make reversals to
the company based on the total amount of agency
commission.
3. After the completion or cancellation of this
contract, it is not possible to avoid the duty, even if it is
applicable to the previous 2 items.
Article 12 (management of transfer
contracts)
If agencies are to handle transfer contracts, agency
commission is decided based on agency consignment rules against the
income premium collected by the company or agency after
transfer.
Article 13 (management of expenses and
such)
Excluding the items below, expenses related to
commission business will be paid by the agency.
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(1)
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Revenue stamp fee of the premium receipt due to
commission business.
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(2)
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Stamp fee for sending surety bond. However, it is
usually limited for the fee of 1 st class
mail.
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(3)
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Transfer fee for executing premium settlement in
article 19.
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(4)
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Others acknowledged by the company as
“necessary”.
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2
Article 14 (method of information
processing)
When processing commission business, agencies are to
follow the statements by this contract, and also the information
processing rules set by the company.
Article 15 (report on insurance contract)
Agencies should immediately report conclusions and
changes in insurance contracts, and upon receiving cancellation
request via methods such as written document or electric mails set
by the company. However, upon receiving cooling-off request from
the insurance contractor, it is necessary to tell the contractor to
report directly to the company via written document.
Article 16 (premium receipt)
Agencies, upon conclusion of insurance contract,
should receipt the total amount at the same time through a method
set by the company. However, if other methods of payment exist for
a particular insurance contract, follow the rule.
2. For insurance contracts handled by the agency,
the company can directly receipt premiums from the insurance
contractor based on receipt methods set by the company.
3. Also, as a general rule, all expenses that
occurred from the company for directly receipting the premium from
the contractor are paid by the agencies.
4. Agencies should not divert the receipted premiums
for other purposes.
5. The term “diversion” defined in this
contract not only refers to consumption by self or non-self, but
violating the safekeeping methods of premium defined in items 1
through 6 in article 18, and items 9 or 12.
Article 17 (management of premium receipts and
such)
Upon receipting premiums, the agencies should issue
premium receipts set by the company through other methods set by
the company to the insurance contractor.
2. Agencies should only issue surety bond or premium
receipts to the insurance contractor after receipting premium based
on article 16 item 1. However, the issuing of surety bond for
transport insurance and cargo insurance contracts, which the
company certifies them to receipt the premium from the insurance
contractor by totaling-up a fixed period, are subject to
exception.
Article 18 (safekeeping of premiums)
Agencies should clearly distinguish the premium from
its own assets, and keep them in a secure place.
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2. Upon receipting premiums, agencies should settle
up to the company without delay, and that this should be deposited
to bank accounts which are specifically for premiums such as Postal
Savings and such without delay. (“premium saving
account” from below onwards).
3. According to the rules from the previous items,
when setting up a premium saving account for saving the premiums
that were receipt for the company, agencies should follow the rules
set by company. Also, report the saving account symbol and number
to the company using a form provided by the company, and get an
approval from the company.
4. If the premium saving account is changed or
discontinued, report the saving account symbol and number to the
company immediately using a form provided by the company, and get
an approval from the company.
5. The name of the premium saving account for the
company will be as follows.
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(1)
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Print “American Home Assurance Company
Agency” in the agency name column.
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(2)
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If an agency has concluded a contract of property
insurance agency consignment with other insurance company, print
the same name as previous item, given that the company’s
premium saving account is kept different from the other account.
However, if an advanced report is sent to the company through a
document, it is possible to deposit premiums from multiple
insurance companies to the same premium saving account at the same
time. In this case, print “property insurance agency
settlement” in the agency name column.
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6. The types of savings that can be setup as premium
saving account are restricted to types set by the company. Also, in
setting up the premium saving account, make sure that there is no
trouble with the premium balance set by article 19.
7. The premium receipted by the agency and premium
saving account belongs to the company.
8. The company is able to withdraw savings in the
premium saving account or order the agency to withdraw them at
anytime.
9. The agency cannot transfer or pledge the premium
saving account.
10. Agency should not deposit any money other than
premiums to the premium saving account.
11. Agency is required to withdraw interests to the
premiums accrued from the premium saving account. The agency will
acquire this withdrawn interest as its income.
12. Agency should withdraw premium saving account
except in the following cases.
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(1)
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Balance of premium due to article 19.
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(2)
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Returning premiums to the insurance contractor
(however, up to the amount limit set by the company).
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4
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(3)
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Saving as income, assuming that the interests have
been withdrawn according to article 19.
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(4)
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When ordered by the company
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Article 19 (settlement of premiums)
When receipting premiums from the insurance
contractor, the agency should follow item 2 and balance them. Also,
as regards to the deposits set by article 11, in case of any
changes in conditions of insurance contract or cancellation, it is
necessary to balance before the end of the following
month.
2. The agency should get an agreement from the
company in advance and balance the premiums through one of the
following methods described in the next items. However, in the case
of item 2, the company notifies the agency 7 days in advance, and
all or part of the premium can balanced in advance of due
date.
(1) Method by balancing the whole premium to the
company each time a premium is receipt without delay.
3. With any of the balance methods mentioned above,
despite the rules in the previous items, the agency may pay the
“agency commission deducted premium” amount to the
company.
4. If the agency itself balances premiums that have
not been mentioned on the company made statement and debit note of
premium, it is necessary to submit a bill with the self-balanced
content written on it without delay.
5. For the premiums of insurance contract, which is
subject to “immediate premium transfer system” set by
the company, the balance is made according to item 2 (1), and the
previous item 2 will be applied.
6. In case of any dishonored check or draft, or
bankruptcy, beginning of civil rehabilitation proceeding, beginning
of company resolution or company renewal proceeding, the agency
should immediately balance the total amount of receipt premiums to
the company, without subtracting the agency commission regardless
of rules in item 3. It also applies when the agency receives
seizure, provisional seizure, provisional disposition, and court
enforcement and that the execution of this contract is certified to
be difficult.
Article 21 (dealing with accidents covered by
insurance)
When notified about an accident, make a report of
the situation immediately to the company.
2. In the case of accidents, the agency should not
give its opinions on the payment reasonability of the company and
its amount to anyone, unless told by the company.
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Article 22 (the persons engaged in insurance
soliciting)
When the agency lets directors or employee for
insurance soliciting, with the company’s directions, make a
report to the company in advance and the education program for the
persons engaged in insurance soliciting proceeds to
completion.
2. The agency should not allow persons not engaged
in insurance soliciting to conclude a representation, invite to
conclusion of insurance contract, explain the contents of insurance
commodity, receipt of premiums, issue premium receipts or produce
applications. Also, the agency should not print names other than
the persons engaged in insurance soliciting on the documents set by
article 30.
3. In case of any change in persons engaged in
insurance soliciting the agency should report to the company
without delay.
4. Agency will take full responsibility for the
actions executed by the persons engaged in insurance
soliciting.
5. If there are any changes in persons engaged in
insurance soliciting, report to the company without
delay.
Article 23 (Agency consignment contract for
insurance against loss with other insurance company)
When concluding an agency consignment contract for
insurance against loss with other insurance company, the agency
needs to get an approval from the company in advance.
2. If the agency cancels the consignment contract
for insurance or gets cancelled by the already consigned insurance
companies, report to the company without delay.
Article 24 (consignment of soliciting to other
property insurance agency or insurance intermediary, prohibition of
consignment payment)
The agency should not conduct commission for
insurance soliciting and pay the commission, reward or take part in
any other considerations against other property insurance agency or
insurance intermediary.
2. The agency should not receive commission for
insurance soliciting and receive commission, reward or any
considerations from other property insurance agency or insurance
intermediary.
Article 25 (Prohibition of joint soliciting by
agency and insurance intermediary)
Agency should not commit joint soliciting with
insurance intermediary.
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Article 26 (Prohibition of simultaneous operation
with the insurance intermediary)
Agency should not commit simultaneous operation with
the insurance intermediary.
Article 27 (Prohibition of concurrent post of
director/employee with the insurance intermediary)
Agency should not have concurrent post of
director/employee with the insurance intermediary and vice
versa.
Article 28 (Prohibition of rebate)
Agency, whether directly or indirectly, should not
provide money and goods equivalent to all or part of the
consignment, premium discount, rebate, or any other sorts of
special profit against insurance contractor, policyholder, or the
persons concerned.
Article 29 (office equipments and goods)
Office equipment and goods such as premium receipt,
account book, document, application form, brochure, sign board,
name card, apparatus, and bank book of the premium saving account
provided to the agency by the company are the property of the
company, and if there is any demand from the company, the agency
should return the office equipments and goods to the company
without delay. Also, the agency is not allowed to use the name of
the company for purposes other than commission business or commit
any act usin
