Commission Summary

We,  Martin  &  Garvan  Insurances Ltd  act  as  intermediary  between  you,  the  consumer,  and  the  product provider  with whom we place your business.

Pursuant to provision 4.58A of   the Central Bank of Ireland’s September 2019 Addendum to the Consumer Protection Code, all intermediaries, must make available in their public offices, or  on their website if they have  one,  a  summary  of  the  details  of  all  arrangements  for  any  fee,  commission,  other  reward  or remuneration provided to the intermediary which it has agreed with its product producers.

For  the  purpose  of  this  document,  remuneration is the payment earned by the intermediary for work undertaken  on  behalf  of  both  the  provider  and  the  consumer.     The  amount  of  remuneration is generally directly related to the value of the products sold.

There are different types of remuneration/commission models:

Single commission model: where payment is made to the intermediary shortly after the sale is completed and is based on a percentage of the premium paid/amount invested/amount borrowed.

Trail/Renewal  commission  model:   Further payments at intervals are paid throughout the life span of the product.

Indemnity commission is the term used to describe a commission payment made before the commission is deemed to  be ‘earned’.  Indemnity commission  may  be  subject  to  a clawback (see  below)  if  the  consumer lapses or cancels the product before the commission is deemed to be earned.

Other forms of indemnity commission are advances of commission for future sales granted to intermediaries in order to assist with set up costs or business development.

General insurance products, such as motor, home, travel, health, retail or liability insurance, are typically subject to a single or standard commission model, based on the amount of premium charged for the insurance product.

In some cases, the intermediary may be a party to a profit-share arrangement with a product provider and will earn additional commission.  Any business arranged with these product providers on a client’s behalf will be  placed  with  the  product  provider  because  that  product  provider  is  at  the  time  of  placement,  the  most suitable to meet the client’s requirements, taking all the client’s relevant information, demands and needs into account.

For Life Assurance products commission is divided into initial commission and renewal commission (related to premium), fund based or trail (relating to accumulated fund).

Trail commission, bullet commission, fund based, flat commission or renewal commission are all terms used for ongoing payments. Where an investment fund is being built up through an insurance-based investment product or a pension product, the increments may be based on a percentage of the value of the fund or the annual premium. For a single premium/lump sum product, the increment is generally based on the value of the fund.

Life  Assurance  products  fall  into  either  individual  or  group  protection  policies  and  Investment/Pension products  would  be  either  single  or  regular  contribution  policies.     Examples  of  products  include  Life Protection,  Regular  Premium  Life  Assurance  Investments,  Single  Premium  (lump  sum)  Insurance-based Investments, and Single Premium Pensions.

Investment   firms,   which   fall   within   the   scope   of   the   European   Communities   (Markets   in   Financial Instruments)  Regulations  2007  (the  MiFID  Regulations),  offer  both  standard  commission  and  commission models involving initial and trail commission. Increments may be based on a percentage of the investment management fees, or on the value of the fund.

Commission  may  be  earned  by  intermediaries  for  arranging  credit  for  consumers.

Clawback  is  an  obligation on the intermediary to repay unearned commission. Commission can be paid directly after a contract is concluded but is not deemed to be ‘earned’ until after a specified period of time. If the consumer cancels or  withdraws from the financial product within the specified time, the intermediary must return commission to the product producer.