Pursuant to provision 4.58A of the Central Bank of Ireland’s September 2019 Addendum to the Consumer Protection Code, all Brokers, 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 Broker which it has agreed with its product producers.
What is Remuneration?
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.
What is Commission?
Commission is payment that may be earned by an intermediary for work undertaken for both
provider and consumer. There are different types of remuneration and commission models:
Single Commission model: Single Commission is 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.
Trail/Renewal commission model: Trail / Renewal are further payments at intervals are paid
throughout the life span of the product.
Indemnity commission: 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.
Life Assurance/Investments/Pension products
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 or renewal commission are all terms used
for ongoing payments. Where an investment fund is being built up though 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.
Investments
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.
Clawback
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.
Life and Pension products:
Acorn Life: Click Here:
Fees
The firm may also be remunerated by fee by the product producer such as policy fee, admin
fee, or in the case of investment firms, advisory fees. Include arrangements etc.
Moneytree Finance Ltd charge a fee of €250 once off Mortgage application fee.
This fee is payable before an application submitted to the lender. This application fee is paid
directly to Moneytree Finance Ltd by the customer , Moneytree Finance will issue a receipt
to the customer once payment is received.
Moneytree Finance Ltd may receive up to 1% (or whatever maximum is applicable) of the
loan for arranging mortgage finance. This commission is paid by the mortgage lender.
Retail Credit Intermediaries
Haven: Click Here
ICS: Click Here
Permanent TSB: Click Here
Ulster Bank: Click Here
Bank of Ireland: Click Here
Acorn Mortgages: Click Here
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