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MetLife pays Supplemental Compensation at a single Tax ID level. Payment is calculated in the following manner:
See the examples below.
PREMIUM CAPPING
MetLife will pay Supplemental Compensation on a maximum of $10 million of Received and Earned Premium (the
“Cap”) per customer6.
If more than one broker is eligible for Supplemental Compensation with respect to one customer where more than $10 million of Received and Earned Premium is paid by such customer, MetLife may apply the Cap per customer and per broker so long as the brokers are not affiliated or under common ownership or control. Before making any Supplemental Compensation payment in that circumstance, MetLife may require the brokers to certify in writing that they are not affiliated or under common ownership or control. If a MetLife customer acquires another company that does not have eligible MetLife products, MetLife will apply the Cap to the Received and Earned Premium from the MetLife customer separately from the Received and Earned Premium from the acquired company for payments under the 2009 Supplemental Compensation Plan. MetLife reserves the right to consider the MetLife customer and the acquired company to be one MetLife customer in relation to any future supplemental compensation plans and to apply one cap to the Received and Earned Premium from the MetLife customer and the acquired company. MetLife reserves the right to obtain written customer authorization before making any Supplemental Compensation payment and to determine in its sole discretion how the Cap is applied.
EXAMPLE:
Assume a broker qualified for Tier 3 and MetLife’s Received and Earned Premium from Company A is $15 million for
Life Insurance and $20 million for STD Insurance.
The $10 million cap is applied and the broker is eligible for a Supplemental Compensation payment for Company A of 2.25% of $10 million, even though the total amount of Received and Earned Premium is $35 million.
Note that here and under all other circumstances, the broker will not be entitled to Supplemental Compensation on and
after the date the broker is deemed by MetLife or the customer to no longer be the Broker of Record.
ASO/PAR CASES
For ASO and Participating (“PAR”) cases, MetLife will apply the full ASO fee or the PAR premium amount towards
Tier qualification. For the Supplemental Compensation payment calculation, however, ASO fees and PAR premium are
reduced to 25% of the actual ASO fees and PAR premium prior to applying the applicable Supplemental Compensation
percentages from each Tier.
EXAMPLE:
Assume that during the Qualification Period the broker qualified for Tier 2 and a 2.00% Supplemental Compensation
payment. In 2009, the broker is Broker of Record on cases for which MetLife earns and receives an eligible ASO fee
of $50,000 and an eligible PAR premium of $25,000. Following is how the Supplemental Compensation payment is
calculated:
MetLife intends to pay Supplemental Compensation on a monthly basis in the month after premium is received by MetLife. Supplemental Compensation shall be earned by the broker only so long as MetLife deems the premium to be Received and Earned Premium, and provided MetLife and the customer continue to recognize the broker as the Broker of Record. Any Supplemental Compensation paid to a broker that is not earned by the broker shall be returned to MetLife and MetLife reserves the right to set-off any amount payable by a broker to MetLife against any amount payable by MetLife to the broker. In instances where multiple payee codes exist for a single Tax ID, MetLife will require the designation in writing by a representative of the single Tax ID of a single primary MetLife broker payee code. When a primary code is designated, it will remain in effect until MetLife receives a written change request. No Supplemental Compensation payments shall be made in advance of when they are due under the Supplemental Compensation Plan. The broker shall immediately return to MetLife any overpayment of Supplemental Compensation the broker receives from MetLife. MetLife reserves the right to recoup any Supplemental Compensation overpayment from any amount MetLife owes the broker associated with the Supplemental Compensation Plan or any other compensation plan or agreement. By cashing any check from MetLife or otherwise accepting any Supplemental Compensation payment, the broker thereby agrees that MetLife may set-off any amount payable by MetLife to the broker in order to recover an overpayment or any other amount payable by the broker to MetLife.
6 If a broker’s total Inforce Premium is equal to or exceeds $250 million on the last day of the Qualification Period, MetLife will pay Supplemental Compensation on a maximum of $20 million of Received and Earned Premium per customer. MetLife reserves the right to disclose to its customers whether or not its broker has a book of business that exceeds $250 million and that MetLife will pay Supplemental Compensation on up to $20 million of Received and Earned Premium.
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