Remuneration and Commission Ireland
skearney Financial Ltd acts as intermediary between you, the consumer, and the product provider with which we arrange your business.
The Background
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.
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 different 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
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 claw back (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, flat commission 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 fees based 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.
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.
Other Fees, Administrative Costs/ Non-Monetary Benefits
The firm may also be in receipt of other fees, administrative costs, or non-monetary benefits such as:
- Attendance at product provider seminars
- Assistance with Advertising/Branding
Sustainability Remuneration Policies
We are remunerated by commission and other remuneration from product providers. The key product providers with which we engage, and receive remuneration from, have developed responsible investment as part of their investment philosophies and sustainability risk policies.
Commission Options
Throughout this summary, there may be various commission options, ranges or maximum percentages of commissions shown. Where these are shown, the basis on which the level of commission taken may be decided at our discretion, set by the product provider, or as otherwise agreed with you, and will be dependent on…
- The type of policy
- Premium amount
- Length of term of the policy
- Length of investment period
- Our time spent researching, advising and arranging products
- Complexity of the product(s) and service provided
- Seniority of personnel involved
- Amount of commission we deem to be appropriate to remunerate us for providing our services to you.
Set out below are the product providers with which we hold an agency. The various remuneration arrangements are shown for each provider and product type.
Irish Life Assurance
This provides summary details of the commission arrangements we have in place for unit-linked and protection business with Irish Life Assurance. Alternative commission structures may be available which are different from the commission structures shown below.
| Product | Payment Type | Initial Commission (Year 1) | Trail Commission (p.a.) | Renewal Commission (p.a.) | Other Commission |
|---|---|---|---|---|---|
| Unit Linked Pension Products Pre-Retirement (PP, PRSA, CP & PRB) | Annual Premium | Max 17.5% (first premium) |
0.5% | 5%, 17.5% (see product for specifics) | N/A |
| Single Premium | Max 5% | 0.75% | N/A | N/A | |
| Unit Linked Pension Products Post Retirement (ARF / AMRF) | Single Premium | Max 5% | 0.75% | N/A | N/A |
| Guaranteed Annuity | Single Premium | Max 3% | N/A | N/A | N/A |
| Investment Bonds | Single Premium | Max 3% | 0.5% | N/A | N/A |
| Investment Only | Single Premium | Max 5% | 0.5% | N/A | N/A |
| Savings Products | Annual Premium | Max 5.5% (first premium) |
0.25% to year 8, 0.5% from year 9 |
5.5% (varies, see product) | N/A |
| Yr1 | Additional (annual) | Renewal (annual) | ||
|---|---|---|---|---|
| Protection | Option 1 | 100% | From Year 2 - 5: 20% | From Year 6: 3% level From Year 6: 6% indexed |
| Option 2 | 25% level 28% indexed |
From Year 2 - 10: 25% From Year 2 - 10: 28% |
From Year 11: 10% level From Year 11: 13% indexed |
|
| Option 3 | 20% level 23% indexed |
From Year 2: 20% level From Year 2: 23% indexed |
||
| Option 4 | 80% Level 80% Indexed |
From Year 2: 12% level From Year 2: 15% indexed |
||
| Default Profile |
||||
| Yr1 | Additional | Renewal (annual) | ||
| Income Protection | Max | 120% | Year 3 & Year 6: 30% | From Year 7: 3% level From Year 7: 6% indexed |
Group Protection
| Renewal commission | |
|---|---|
| Life Cover | |
| Max | 6% |
| Income Protection | |
| Max | 12.5% |
| Serious Illness Cover | |
| Max | 12.5% |
Zurich Life Assurance
This provides summary details of the commission arrangements we have in place for unit-linked and protection business with Zurich Life Assurance. Alternative commission structures may be available which are different from the commission structures shown below.
Single contribution products (Pensions, Investments)
| Product | Up front commission | Trail commission p.a |
|---|---|---|
| Single Contribution Pension | Max 5.50% | 0.50% |
| Single Contribution PRSA (Standard) | Max 5.50% | 0.00% |
| Single Contribution PRSA (Non-Standard) | Max 5.0% | 0.50% |
| Approved (Minimum) Retirement Funds | Max 5.0% | 0.50% |
| Annuities | Max 3.0% | N/A |
| Investment Bonds | Max 5.0% | 0.50% |
| Trustee Investment Plans | Max 5.0% | 0.50% |
Commission claw back:
Commission claw back typically does not apply to single contribution products
Zurich Life Assurance plc
Regular contribution products (Pensions, Savings)
| Initial commission | Renewal / Bullet Commission | Trail commission (p.a.) | |
|---|---|---|---|
| Max | 20.0% | 3.0% renewal | 0.50% |
| Regular Contribution PRSA (Standard) | |||
| Max | 5.0% | 5.0% renewal | 0.0% |
| Regular Contribution PRSA (Non-Standard) | |||
| Max | 5.0% | 5.0% renewal | 0.50% |
| Savings Plan | |||
| Max | 10.0% | 1.0% renewal | 0.50% |
Commission claw back:
Commission claw back applies over a 4-year period for all initial commission. Commission claw back also applies over a 4-year period for any bullet commission noted.
Individual Protection
Guaranteed Term Protection & Guaranteed Mortgage Protection
| Yr1 | 2 - 10 | 11+ | |
|---|---|---|---|
| Max | 100% | 12% | 3% |
Commission claw back:
Commission paid in year 1 is earned over a 12-month period.
Guaranteed Whole of Life
| Yr1 | 2 - 5 | 6+ | |
|---|---|---|---|
| Max | 90% | 18% | 3% |
Commission claw back*
Commission paid in year 1 is earned over a 12-month period.
Group Protection
Group Life Cover
| Yr1 | 2 | 3 | |
|---|---|---|---|
| Max | 6.0% | 6.0% | 6.0% |
Commission claw back:
Does not apply. Commission is paid as premiums are received.
Group Permanent Health Insurance & Group Serious Illness Cover
| Yr1 | 2 | 3 | |
|---|---|---|---|
| Max | 12.5% | 12.5% | 12.5% |
Commission claw back:
Does not apply. Commission is paid as premiums are received.
Quilter Cheviot
Quilter Cheviot does not pay Commission to Intermediaries. Instead, we agree on fees with our clients, which in turn Quilter Cheviot deducts that percentage from the client's portfolio.
| Product | Initial Advisory Fee | Claw back period | Ann. Advisory Fee |
|---|---|---|---|
| Single Premium Investment | Max. 2% | N/A | 0.5% |
| Pension - Self Directed | Max. 2% | N/A | 0.5% |
| ARF/AMRF - Self Directed | Max. 2% | N/A | 0.5% |
Other Product Providers
Non-Insurance based Lump Sum Investments
| Initial Commission (Year 1 Max.) | Renewal or Trail Commission | Other Commission | |
|---|---|---|---|
| Conexim | 3% | .5% | N/A |
| J&E Davy | 5% | .5% | N/A |
| Greenman | 3% | .5% | N/A |
Non-Insurance Based Pension Investments (Self-Directed)
| Newcourt Retirement Fund Managers | Initial Commission (Year 1 Max.) | Renewal or Trail Commission | Other Commission |
|---|---|---|---|
| ARF's & AMRF's | 3% | 0.5% | N/A |
| PRSA's | 10% | 0.5% | N/A |
| PRB's | 3% | 0.5% | N/A |
| Independent Trustee Company | Initial Commission (Year 1 Max.) | Renewal or Trail Commission | Other Commission |
|---|---|---|---|
| ARF's & AMRF's | 3% | 0.5% | N/A |
| PRSA's | 0% | 0.5% | N/A |
| PRB's | 3% | 0.5% | N/A |
| J&E Davy | Initial Fee (Year 1 Max.) | Renewal or Trail Commission | Other Commission |
|---|---|---|---|
| ARF's & AMRF's | 5% | 0.5% | N/A |
| PRSA's | 0% | 0.5% | N/A |
| PRB's | 5% | 0.5% | N/A |