MAX LIFE INSURANCE COMPANY LIMITED
May 8, 2019
“Agency Circular No. 37”
Payment of Commission on Termination of Agency Appointment
To,
All Max Life Insurance Agents,
This circular replaces Agency Circular No. 20 of the Agent Handbook.
This is to communicate that the following Payment of Commission Post Termination of Agency
Appointment Circular shall be effective from April 1, 2019.
Upon the termination of the agency appointment, in order to settle accounts with the agent advisor (“Agent
Advisor”), payment of commission etc. shall be subject to the following terms and conditions:
a) Commission payments which has become due to the Agent Advisor before the date of termination
of his agency appointment shall be settled in the commission disbursement cycle that falls
immediately after fifty (50) days from the date of such termination.
For the sake of clarity, modal commission will be due as and when the modal premium is received
by Max Life. For example, If the first year premium amount is payable in quarterly installments,
only the commission payable in respect of the modal premium allocated by Max Life prior to the
date of termination of the Agent Advisor’s appointment shall become due to the Agent Advisors.
To illustrate:
An Agent Advisor sources a policy where the first year premium of INR 10,000 is payable in
quarterly installments of INR 2500 each (“modal premium”). The policy is underwritten and the
first modal premium (INR 2500) is allocated by Max Life on 15th December, 2019. Thereafter, the
Agent Advisor’s appointment is terminated on 15th January, 2020. The commission that will be due
to the Agent Advisor as on 15th January, 2020 will be the amount of commission due on the modal
premium that has been received by Max Life before 15th January, 2020 i.e. INR 2500.
b) For the Agent Advisor who were terminated on or before 31st March, 2015, the Company shall
continue to pay renewal commission to the Agent Advisors who were eligible as per the erstwhile
Section 44 of the Insurance Act, 1938.
c) For the Agent Advisor who gets terminated on or after April 1, 2019, the Company shall pay
renewal commission subject to fulfilment of following condition:
Agent Advisor has worked continually and exclusively for 15 years with Max Life and has
completed age of 65 Years as on the date of termination; OR
Agent Advisor has worked continually and exclusively for 20 years with Max Life and has
completed age of 60 Years as on the date of termination.
The renewal commission shall be payable in these scenario even if the Agent Advisor has been
terminated for any reason except for termination due to any disciplinary action taken by Max Life.
d) In the event of the death of an Agent Advisor, renewal commission (or portion of the first year
commission that would have been paid to him had the Agent Advisor been alive) will continue to
be payable to the legal heirs of the deceased Agent Advisor provided such commission would have
been payable to the Agent Advisor, irrespective of the tenure of his association with Max Life.
However, in the event death occurs after the Agent Advisor has been terminated for any reason, no
renewal commission shall be payable.
e) In the event the Agent Advisor gets fully disabled before agency termination (on or after April 1,
2019) and has been declared fully disabled by Chief Medical Officer of Max Life, renewal
commission (or portion of the first year commission that would have been paid to him if he had
been working actively) will continue to paid to the Agent Advisor provided such commission would
have been payable, irrespective of the tenure of his association with Max Life. However, in the
event disability occurs after the Agent Advisor has been terminated for any reason, no renewal
commission shall be payable.
f) In the event of termination of the appointment of an Agent Advisor who has jointly sourced a policy
with another Agent Advisor, in accordance with the terms of agency appointment, the other Agent
Advisor will continue to get his share of commission as agreed between them and informed to Max
Life in accordance with Agency Circular No. 13. Any commission or renewal commission so paid
shall be in accordance with para b and para c above.
g) If the termination of the Agent Advisor is due to any disciplinary action taken by Max Life, no
commission shall be payable.
h) The term ‘termination’ shall include the termination of agency code by Max Life for any reasons
including resignation by the Agent Advisor.
Shiv Maheshwari
Executive Vice President & Head- Agency Distribution
Max Life Insurance Company Limited