b. The company must inform the agent, at least 180 days in advance, of its intention to negotiate an amendment or modification of this agreement, including changes to commissions, before such amendments come into force. Since the Agent and the Company intend to ensure the stability of their relationship, this Agreement shall remain in force for a minimum period of ______ for consecutive years, beginning on 1 January, unless terminated in accordance with the terms of this Agreement. In addition, despite the recent focus on underwriting automation, it is extremely difficult to automate the underwriting of special risks, which still requires underwriting judgement. Therefore, experts predict that MGAs will remain an important and profitable part of the insurance market. Provision (B) is extremely important because it ensures that the agency`s name is prominently displayed on all communications from the company to the insured. In the absence of such protection, the agent`s relationship with the insured could be seriously compromised. If the agent represents a company without an arbitration clause in their agency contract, they should ask the company for written notice of their dispute resolution procedures. But this case is not without dangers.
Insurers suffered significant losses in transit and accident activities as well as in run-off operations due to various notable failures. In response to some of these failures, the industry has begun to amend MGA agreements to include rolling commissions, enhanced audits, and closer coordination between insurers and MGAs. The Wholesale and Specialty Insurance Association (WSIA) is the commercial organization that represents members of the MGA insurance system, known as „wholesale insurance.“ More than 800 member companies today work within the organization that provides education, recruitment, advocacy and support to the wholesale and special/surplus insurance sectors. WSIA carefully checks its members before being admitted to ensure they meet WSIA`s high service standards. B. The name of the Agency must be clearly displayed on the company`s communications to the insured, in the largest printing prefacts and, in any event, in printed form, no smaller than the largest used on the communication. Fixed-term contracts with rollover functions give security and stability to the agent-company relationship, which benefits the insurance customer for better continuous service. Such agreements would help both agents and companies plan their activities. Provision (a) recognizes that the contract is an agreement between two contracting parties and that, before modifying the terms of the agreement, each will negotiate in good faith with the other and agree on the modifications to be made. This provision clearly shows what was implicit – the duty of good faith that was imposed on each party to negotiate with the other on an individual basis. It is an important principle that the agent should ensure that it is written into his contract. If termination is unavoidable, there are certain safeguards that should be included in the agency contract.
There should be a provision allowing the agent to notify in writing at least 180 days in advance of termination, with such notification containing specific grounds for termination. In the event of termination, all extensions, which take place within one year from the date of termination and which comply with current underwriting standards, should be extended for at least one additional year, under the conditions in force before termination. . . .