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Binding Authority Agreement
"I need a Binding Authority Agreement under Dutch law for a specialty marine insurance product line, with authority to underwrite policies up to €5 million per risk, including claims handling authority, starting from March 1, 2025."
1. Parties: Identification of the insurer/principal and the coverholder/agent, including full legal names, registration details, and regulatory authorizations
2. Background: Context of the agreement, relationship between parties, and purpose of the binding authority arrangement
3. Definitions: Comprehensive list of defined terms used throughout the agreement
4. Appointment and Scope: Formal appointment of the coverholder and detailed scope of delegated authority
5. Term and Renewal: Duration of the agreement, conditions for renewal, and notice periods
6. Authority and Limitations: Specific powers granted to the coverholder and their limitations, including classes of business, territories, and financial limits
7. Duties and Responsibilities: Detailed obligations of the coverholder in exercising the delegated authority
8. Compliance Requirements: Regulatory compliance obligations, including insurance regulations, data protection, and anti-money laundering requirements
9. Reporting and Auditing: Requirements for regular reporting, record-keeping, and audit rights
10. Remuneration: Commission structure, payment terms, and other financial arrangements
11. Professional Indemnity: Insurance requirements and professional indemnity obligations
12. Termination: Grounds for termination, notice requirements, and consequences of termination
13. Post-Termination Obligations: Continuing obligations after termination, including run-off arrangements
14. General Provisions: Standard contractual provisions including governing law, jurisdiction, entire agreement, and amendments
1. Sub-Delegation: Include when the coverholder is permitted to sub-delegate certain authorities to third parties
2. Claims Handling Authority: Include when claims handling authority is delegated to the coverholder
3. IT Systems and Security: Include when specific IT systems or security requirements are essential to the arrangement
4. Business Continuity: Include when specific business continuity and disaster recovery requirements are needed
5. Marketing and Branding: Include when the coverholder is authorized to use the insurer's branding or has specific marketing responsibilities
6. Training Requirements: Include when specific staff training and competency requirements are necessary
7. Profit Commission: Include when profit-sharing arrangements are part of the agreement
1. Schedule A - Classes of Business: Detailed list of insurance classes and products covered by the authority
2. Schedule B - Territorial Limits: Specific territories where the authority can be exercised
3. Schedule C - Underwriting Guidelines: Detailed underwriting criteria, limits, and excluded risks
4. Schedule D - Commission Schedule: Detailed breakdown of commission rates and payment terms
5. Schedule E - Reporting Requirements: Formats, frequencies, and contents of required reports
6. Schedule F - Service Levels: Specific service standards and performance metrics
7. Appendix 1 - Policy Wording Templates: Approved policy wordings and endorsements
8. Appendix 2 - Claims Handling Procedures: Detailed procedures for claims handling if delegated
9. Appendix 3 - Systems and Security Requirements: Technical specifications for IT systems and security protocols
Authors
Insurance
Financial Services
Reinsurance
Risk Management
Insurance Broking
Financial Technology
Professional Services
Legal
Compliance
Underwriting
Risk Management
Operations
Business Development
Claims
Regulatory Affairs
Product Development
Quality Assurance
Finance
Actuarial
Chief Underwriting Officer
Compliance Officer
Legal Counsel
Managing Director
Underwriting Manager
Risk Manager
Operations Director
Business Development Manager
Claims Manager
Regulatory Affairs Manager
Contract Manager
Insurance Operations Manager
Portfolio Manager
Product Development Manager
Quality Assurance Manager
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