CODE OF ETHICS FOR TAKAFUL AGENTS
One of the more prominent endeavor for Takaful Operators is to create a healthy and highly credible business environment. A healthy and credible environment is necessary to ensure that the interests of the Member Companies and the benefits to the public are protected.
It is imperative that the Takaful Operators’ Agents observe the standard of ethics which forms the basis of the principles and business of Takaful.
To this end, the Malaysian Takaful Associations (MTA) has made it their aim to introduce a set of rules of ethics for the use of the Takaful Operators’ Takaful Agents. This Code of Ethics is the basic guideline for Takaful Agent to observe in their practice. The agenda of the guideline is to strengthen universal moral values and consequently to uphold the interests and the welfare of the company, the shareholders, the Takaful participants, the community in general and the Agent themselves.
Central to this Code of Ethics is the principle that this Code encapsulates the tenets of honest practices, responsible, transparent as well as carrying social agenda for the community.
This Code of Ethics is formulated with a view to attaining the following objectives:
- To provide a minimum standard of conduct for the Agents while keeping to the principles and practice of meeting the objectives, missions and requirements of the Takaful Operators;
- To create a healthy, transparent and fair business practice code of conduct;
- To inculcate best practice standard of conduct amongst the Agents;
- To ensure that the Agents constantly conduct themselves in a manner which does not contradict the code of ethics which has been drawn up.
- This Code of Ethics is applicable to all registered agents of the Takaful Operators’ but its provision shall not be mandatory on International Takaful Operators’ Takaful Agents;
- Where any provision of this Code of Ethics is or for any reason becomes void, unenforceable or prohibited, it will not affect the validity of or the enforceability of the other provisions of this Code of Ethics; and
- This Code of Ethics is subject to the Takaful Act 1984 and any other Act of law subsequent introduced governing the practice of Takaful in Malaysia.
Summary of Title
This Code of Ethics contains the Code of Ethical Conduct for Takaful Agents.
For the purposes of this Agreement, unless the context otherwise requires.
Words importing the singular include the plural and words importing the masculine gender includes the feminine and neuter genders. Words referring to a person include individuals and corporations.
References to the provisions of any law refers includes a reference to any amendment of the law and re- enactments.
References to all Parts, Sections, Schedules are to be interpreted as references to all Parts, Sections and Schedules of the Code of Ethics.
Headings of parts and sections in the Code of Ethics is intended only for the ease of comprehension and should not be taken into account in the interpretation of the provisions of this Code of Ethics.
References to any document includes references to the same which may from time to time be amended in any circumstances whatsoever or matters related thereto and others documents executed from time to time as a supplement or supplementary to it or in substitution to the same.
Words and phrases defined in the Agreement to which this Code is an Appendix and in the First Schedule and the Second Schedule thereto shall, when used herein, bear the same meaning as in the Agreement, the First Schedule or the Second Schedule, as the case may be.
Intermediaries     Refers to any person or persons, whether corporate or unincorporated, authorized directly or indirectly to procure, market, transact, deal or negotiate any takaful business for or on behalf of Takaful Operators.
Takaful Operators(s)     Refers to a company licensed under the Takaful Act 1984 to carry out the business of takaful.
Bank     Refers to Bank Negara Malaysia.
Shariah Committee     Refers to the Takaful Operators’ Shariah Committee appointed according to the provisions of their Memorandum and Articles of Association.
Shariah     Refers to rules of Shariah approved by the Takaful Operators’ Shariah Committee or to the National Shariah Advisory Council, Bank Negara Malaysia, where applicable.
Takaful Act     Refers to the Takaful Act 1984 including any amendments of the law or re- enactments thereof.
Takaful Business     Refers to all Takaful Business as defined in the Takaful Act 1984.
Related Persons     Persons related to a person including: -      a) the spouse;      b) a brother or sister;      c) a brother or sister of the person’s spouse;      d) a person who has a direct nasab (blood relationship) with the persons;      e) a person who has an ascending or descending nasab with the persons;      f) a spouse of any one of the persons mentioned in paragraphs (b), (c), (d) or (e);      g) a person who has a direct descending nasab with any of the persons mentioned in paragraphs (b), (c) or (f);      h) an uncle, aunt or cousin to a person, or to the person’s spouse; or      i) a spouse, or a person with a descending, with the persons mentioned in paragraph (h).
CODE OF ETHICS
Summary of Title
Each Agent is to conduct and deal with all Takaful transactions, business, operations and activities according to the Takaful Act and to observe Malaysian laws as well as Bank Negara Malaysia guidelines.
Each Agent is to refer to the Takaful Operator in the event of doubt or inconsistency with regard to a confirmation or observation of the Takaful Act and other relevant regulations.
When underwriting, each Agent must comply with, observe and to refer to underwriting and actuarial principles applicable as prescribed by Takaful Operator; and
Each Agent must refer to/be guided by the Agents’ manual where it may safely be followed.
Specific Principles of Transaction
Family Takaful Agents are allowed to represent only one (1) Takaful Operator. Representing another Takaful operator for Family Takaful Business is prohibited.
General Takaful Agents are permitted to represent two (2) Takaful Operators.
General Principles of Transaction
Signed a declaration that they will obey the guidelines laid out;
Introduce himself/herself as a Takaful Agent and produce their registered Agent authorization card when dealing with clients;
Ensure that the proposed plan or scheme meets with the participants’ needs and requirements;
Ensure that the proposed plan/scheme meets with the client’s need and means;
Provides consultation services based on the Agent’s expertise and referring to the Takaful Provider’s expertise, where necessary;
Consider that all information given by a prospective participant to the Takaful Operator and the Agent is confidential whether he is still a Takaful Agent or has ceased his period of service with the Takaful Operator. The Takaful Agent is prohibited from disclosing or utilizing certificate-holders’ personal information, trademark, correspondence between clients, and companies’ accounts or business.
Provide a comprehensive and comparison of the details of each product when comparing the same to other types of product;
Observe the principles and values set out and compete in a healthy manner in expanding the Takaful market and the Takaful Operator’s business;
Communicate with clients with fairness and honesty;
Ensure that clients do not suffer any losses whether through any act commission or omission of the Agent;
Provide extensive services (after sales services) to Participants;
Ensure that any advertisement or public announcement is clear, does not confuse or misleads with regard to the Agent or other members;
For those who are appointed as a Takaful Operator’s Agency Manager or an Agency Supervisor to hold the post on full-time basis.
Agents are PROHIBITED from:
Making, producing or participating in the making of any act or announcement of any statement, promise or estimate where it is known that the same is confusing or dishonestly suppressing any material fact;
Making any advertisement of the Agent himself or of his agency through any print or electronic media such as [newspapers, the internet] or others without Takaful Operator’s written consent;
Using a job title/designation other than that allowed by the company;
Misleading the public by causing them to believe that the Agent is a Takaful Operator or a Takaful protection provider, or that the Takaful products provided are provided by the Agent;
Making any inaccurate and unfair criticism of other insurance companies or other Takaful Operators;
Persuading clients from canceling existing certificates, unless such existing certificates do not meet the needs of the client;
Agents are also absolutely prohibited from using the names of any proxy including that of relatives in order to secure the contract as Agent with the intent of conducting any transaction on behalf of the Takaful Operator;
Using any information obtained by the Company to further his own ends or for any purpose other than that of the Takaful Operator’s; and
Imposing any additional charges on the agreed contribution unless the prospective certificate holder is informed of the amount and the purpose of the additional charge.
Explanation of the Takaful Contract
Explain all provisions contained in a proposed contract(s) to ensure that the client fully understands the extent of his involvement;
Give an explanation as to the exemptions contained in the certificate;
Specific provisions for Family Takaful contracts:
- Focus on the long-terms nature of the certificate and explain to the client the consequences of an early surrender of the certificate;
- Clarify whether or not the certificate is exempted from tax;
- Where a certificate provides for profit-sharing with the Takaful Operator or depends on variable factors such as investment performance, a clear illustration of the variable profits to be expected must be made. In the case of collateral certificates where the proceeds of the matured certificate are used to settle financing facilities, the illustration given must clearly show that there is no guarantee that the full amount of the facility will be payable upon maturity of the certificate;
- When illustrating the profits to be gained from investment, it must be explained that the profits to be gained from investment is based on certain assumptions. Therefore, future profits are not guaranteed; such profits may be lower or higher than current profits (past performance does not necessarily indicate future trend);
- Agents are provided with illustrations by the Takaful Operators. Therefore, the Agents must provide a complete illustration to a prospective client during discussions;
- Agents are absolutely prohibited from amending the illustrations provided by the Takaful Operators or from increasing the rate of investment profit without written consent from the relevant Takaful Operator;
- Agents are absolutely prohibited from adding to or highlighting certain favourable aspects only; and
- Agents must provide information that is accurate and without any intention of fraud or similar.
Specific provisions for General Takaful contracts:
- For motor vehicle Takaful, no Agent may assume any risks to which the Takaful (Assumption of Risk and Collection of Contributions) Regulations 1985 apply unless and until cash before cover has been accepted by the Agent;
- For motor vehicle Takaful, where the contribution has been paid to the Agent by the participant, the Agent must remit the said contribution to the Operator or to the collection account specified by the Operator within seven (7) working days of the date of such assumption over of risk.
- Cancellation of a motor vehicle Takaful is not allowed except in cases where the participant’s cheque is rejected by the relevant bank.
Disclosure of Underwriting Information
When receiving a completed proposal form or any other materials, Agents must:
- Avoid from influencing the proposer and should explain to him that all answers or statements are the responsibility of the proposer’s; and
- Provide an explanation of Section 28 of the Takaful Act 1984 whereby the proposer is informed of the consequences of non-disclosure and of giving inaccurate statements by focusing on the relevant statements contained in the proposal form and giving a detailed explanation thereof to the proposer.
Accounts and Financial Aspects
- All contributions or monies collected on behalf of the Takaful Operator must be directly forwarded to the same or be deposited as soon as possible into a bank account in the name of the Takaful Operator;
- All accounting business and financial aspects must be conducted with transparency and without giving rise to any prejudice.
Subject to Laws and Other Regulations
- The Agents are subject to the provisions of the Takaful Act 1984 and to other laws and regulations issued by the Takaful Operators, industry law-makers and other authorities.
Agents are subjected to the fulfillment of the Minimum Requirements for the Continuous Professional Development (CPD) as per the Guidelines on CPD Hours issued from time to time.
The Importance of Ethics for Agents
Takaful transactions are based on trust and honesty as well as requiring a responsible attitude and a high level of professionalism. The confidence of Takaful participants and of the public will be ensured and enhanced if Agents run their Takaful Business on the following principles:
- Magnanimous and charitable
Disciplinary Procedures and Penalties
Where there has been a breach of the Code of Ethics by any Agent, the Malaysian Takaful Association may impose any penalty in accordance with the amount of penalty imposed by the relevant Takaful Operator as follows (or a combination thereof):
- The penalty amount imposed on the Takaful Operator by the Malaysian Takaful Association due to the breach by the Agent; and/or
- A proposal that the said Agent’s contract be terminated.
Any breach of the Code of Ethics must be reported to the disciplinary committee.
Amendments to the Code of Ethics
Amendments to the Code of Ethics
- The Malaysian Takaful Association has the right to rescind, modify, change or amend this Code of Ethics to render it suitable to the Takaful Business environment and other circumstances. Agents are hereby bound and subject to any future amendments made; and
- In the event of any changes, the Malaysian Takaful Association shall inform the Agents through a notice given to the Takaful Operators before the said changes take effect.
All Takaful Agents must at all times comply with every guideline and rule contained in this Code of Ethics.
TAKAFUL AGENTS CONTRACT - TERMS & CONDITIONS
- Subject to the Takaful Operator's rights to terminate this Contract as set out hereunder, this Contract shall be deemed to be valid and binding upon the Takaful Operator for so long as the Agent's Schedule of Commissions shall continue to subsist and after any revocation of such Schedule by the Takaful Operator, there shall be no holding over of any of the Terms or Conditions of this Contract save and except that the Takaful Operator shall be entitled to enforce any such Terms or Conditions by reason of any breach on the part of the Agent.
- The Agent shall only be entitled to commission on any takaful where his name appears on the application for such takaful. All business secured by more than one Agent shall be construed as joint business of the Agents and the commission payable for this business shall be divided equally between the Agents whose names appear on the application. Such joint business and sharing of commission shall be limited to a maximum of two agents of the same agency, or such other persons as the Takaful Operator expressly authorises.
- When any certificate issued upon the application submitted by the Agent pursuant to this Contract is changed or converted to another certificate plan, the commission payable upon the changed or converted certificate shall be determined by the rules of the Takaful Operator current at the time of such change or conversion. The Agent shall not be entitled to any commission on the changed or converted certificate unless the change or conversion is effected by the Agent himself.
- When a new certificate is issued and a previously existing certificate on the same person covered shall terminate within one year before or after the issue of the new certificate, no Commission or other benefits will be allowed on the new certificate. Previously existing certificates, which are converted into paid-up takaful or extended term takaful, reduced in face amount or placed under automatic contribution loan for a continuous period of six (6) months, changed or modified as to effect a reduction in the amount of contributions of more than twenty five percent (25%) arising from the reduction of sum covered and/or reduction of rider or removal of rider, shall be deemed to be terminated and the provisions of this clause shall apply. This clause shall be read subject to the Takaful Operator’s policy on replacement of certificates that may be in force from time to time.
- If any family takaful certificate shall terminate for non-payment of contribution and shall be reinstated subsequently, the Agent shall only be entitled to receive any future commission payable on such certificate if he reinstates the terminated certificate within the period of ninety (90) days from the date of termination of such certificate and during the said period of ninety (90) days no other Agent shall be permitted to reinstate such certificate.
- If the Takaful Operator shall refund the contributions to the certificate holder on any certificates and cancel the certificate for any reason whatsoever, the Agent shall return to the Takaful Operator on demand the amount of commission, bonus and other incentives received on the contributions so refunded. The Agent authorises the Takaful Operator to charge his agent's account for the aforesaid amounts.
- Any benefit, remuneration, privilege or perquisite not expressly set out herein or referred to in the Agent's Schedule of Commissions shall be at the sole discretion of the Takaful Operator without any binding legal effect on the Takaful Operator to continue or improve any such benefit, remuneration, privilege or perquisite and the Takaful Operator shall be at full liberty to modify, change or discontinue forthwith any such benefit, remuneration, privilege or perquisite.
- All applications received by the Agent for family takaful (including group family takaful) or annuities shall be submitted to the Takaful Operator and all applications received by the Agent for group takaful (other than group family takaful) (for which the Takaful Operator is authorised and where the agent is licensed) shall be submitted first to the Takaful Operator on a best endeavour basis. During the continuance of this Contract the Agent binds himself for family takaful (including group family takaful) not to solicit or distribute, either directly or indirectly, in any manner, any such takaful as referred to in this clause for any other takaful operator or person unless the Takaful Operator has given its written consent to the Agent that he may do so.
- All monies, property or securities received by the Agent for and on behalf of the Takaful Operator shall be held by him as a fiduciary trustee on trust. The Agent shall not use, appropriate and/or in any way dispose of the monies, property or securities belonging or payable to the Takaful Operator, but shall promptly report and hand over to the Takaful Operator all such monies, property or securities so held by him.
- The Agent shall, whenever the Takaful Operator so requires, furnish to the Takaful Operator, a detailed report on all certificates, applications, receipts or notes in his possession for delivery to or collection by the certificate holders; on certificates, applications or receipts returned to him by certificate holders for cancellation by the Takaful Operator, and on every item of business transacted by him. The Agent shall also furnish to the Takaful Operator upon request of the Takaful Operator a detailed account of all the monies, property, or securities in his possession or control belonging to the Takaful Operator. All reports and accounts furnished to the Takaful Operator by the Agent shall be signed by the Agent personally. If the reports and accounts furnished to the Takaful Operator disclose that the Agent is holding monies, property, or securities belonging to the Takaful Operator, the Agent shall immediately pay over such monies, property, or securities to the Takaful Operator upon demand by the Takaful Operator.
- The Agent will not deliver any certificate issued by the Takaful Operator to any person unless the person covered the certificate is issued is at the time in good health and will not in any case, unless otherwise permitted by the consent of the Takaful Operator deliver to any person or body of persons corporate or incorporate any certificate or renewal receipt of the Takaful Operator until the contributions due thereon has been actually paid to the Takaful Operator.
- The Agent shall not make any alterations, additions or erasures on any of the documents belonging to the Takaful Operator or any applicant for takaful or certificate holder which may from time to time be in the possession of the Agent.
- The Agent shall not use or supply to any prospective certificate holder or other relevant party any illustration, brochure or other document (in written or electronic form) other than those provided to the Agent by the Takaful Operator or which the Takaful Operator may from time to time authorise the Agent to use.
- The Agent shall ensure that if there are any alterations in the original application that these are countersigned by the certificate holder except where the application is in electronic form and this requirement is not possible.
- The Agent shall not negotiate, enter into contracts and/or agreements on behalf of the Takaful Operator and the Takaful Operator shall not be bound by any contracts and/or agreements made by the Agent. This clause shall not affect or prejudice the Agent's right to solicit applications for takaful and/or annuities for the purposes of concluding takaful or annuity contracts between any person or body of persons, corporate or incorporate and the Takaful Operator.
- The Agent has no authority to make, modify or discharge any contract, nor to waive any forfeitures, nor to incur any liability or debt for or against the Takaful Operator, nor to receive any monies due or to become due to the Takaful Operator, except on contribution receipts (issued by the Takaful Operator) sent to the Agent for collection, and then only provided that the terms and provisions contained in the said receipts shall be strictly complied with and the Agent has no authority to credit or remit contributions not actually or properly received in accordance with this Contract and the instructions of the Takaful Operator and the Agent's powers shall extend no further than as expressly stated in this Contract.
- The Agent shall promptly report to the Takaful Operator any claim made by a certificate holder or beneficiary, the rightful nominee duly named or deemed under the Islamic Financial Services Act 2013 as amended from time to time and the Agent shall under no circumstances make any admission of liability or offer to settle any claim on behalf of the Takaful Operator.
- The Agent has no authority to make any statement, representation, comparison in written or verbal form which is to the Agent's knowledge untrue, false or unsubstantiated, and in so far as it relates to any takaful product or financial information. The Agent will ensure compliance with any Takaful Operator, regulatory or industry directive in whatsoever form.
- The Agent shall upon demand from the Takaful Operator forthwith return to the Takaful Operator all uncollected certificates and contribution receipts in his possession, which the Agent retains for the purpose of transmission to certificate holders, or otherwise.
- Should this Contract be terminated for any reason whatsoever the Agent will immediately return to the Takaful Operator all documents and data (in printed, written or electronic forms) or other software which the Agent has or is capable of having in his custody or possession relating to this Contract, or as may otherwise be the property of the Takaful Operator, and the Agent undertakes and will ensure that no copies in whatsoever form are made, retained or distributed unless the Takaful Operator expressly at the time authorises.
The Agent shall not without prior written consent of the Takaful Operator:-
- publish or cause to be published any material including advertisements concerning the Takaful Operator or any other takaful operator in any newspapers, magazine or publication (in printed, written or electronic forms) whatsoever;
- Issue a press release, hold a press conference or speak to the media in respect of the Takaful Operator, its certificate holders or any other takaful operator; and
- issue, distribute or cause to be issued or distributed any circular or write or cause to be written any circular or write or cause to be written any letters to any newspapers, magazine, publication or medium or any regulatory authority in respect of the Takaful Operator or any other takaful operator.
If any lawsuits shall be brought against the Takaful Operator in consequence of any unauthorised action or statement of the Agent, all costs and damages arising therefrom shall be borne by the Agent personally.
- The Takaful Operator shall have the right at all times, and the Agent hereby authorises the Takaful Operator, to set-off against any sum due to the Agent, any debt, obligation or liability due or owing by the Agent to the Takaful Operator or owing by the Agent to any third party which may have a claim against the Takaful Operator, and the setting off shall not create a cause of action against the Takaful Operator that any sums of money are withheld from the Agent, when there is a debt or obligation of the Agent due to the Takaful Operator or other legitimate third party.
- The Agent shall not pay or allow, or offer to pay or allow as an inducement to any person to participate in takaful plan, any rebate of contribution or any inducement whatsoever not specified in the certificate or expressly authorised by the Takaful Operator. The Agent shall not endeavour or attempt to induce, whether directly or indirectly, any other agent or representative of the Takaful Operator to cease their business association with the Takaful Operator or terminate his Contract with the Takaful Operator (as the case may be).
- The Agent shall not enter into any arrangement or induce any certificate holder or any other person to make any takaful claim of whatever nature which is not a proper and valid claim and the Agent will not receive, attempt to receive or accept any monies whether in full or in part paid by the Takaful Operator pursuant to a validly proved claim or settlement thereon.
- Notwithstanding the generality of Clause 21 (a) or (b), if the Agent were at any time prior to becoming the Agent of the Takaful Operator an agent of another takaful operator, the Agent shall not knowingly procure or cause a certificate holder of that other takaful operator to convert, lapse, forfeit, surrender or replace an existing certificate of that takaful operator, and upon termination of this Contract with the Takaful Operator, the Agent shall likewise strictly observe this provision in respect of the Takaful Operator.
- The Agent shall not, during and for one year after the termination of this Contract, induce, or endeavour or attempt to induce, whether directly or indirectly, any other agent, agency leader, employee or representative of the Takaful Operator to leave its service or terminate his contract or any other contract with the Takaful Operator (as the case may be).
This Clause 21 shall in every respect survive the termination of this Contract for a period of one year thereafter and the Agent shall remain liable to the Takaful Operator in the event of any breach and irrespective of any other rights the Takaful Operator may have in the event of a breach of this clause the Takaful Operator shall have the right to withhold any monies or property otherwise due to the Agent.
- The Agent shall disclose to the Takaful Operator and where relevant the prospective certificate holder every fact and circumstances within his knowledge relevant to the acceptance of the risk by the Takaful Operator, and shall accurately relate to the Takaful Operator every fact disclosed to him by the proposed person covered and/or any other person relevant to the Takaful Operator's acceptance of the risk.
- The Agent shall provide to the prospective certificate holder a needs analysis as required by any industry body or regulator, and shall disclose to the prospective certificate holder any material/information and facts relevant to the risk to be underwritten by the Takaful Operator.
- The Agent shall indemnify and keep indemnified the Takaful Operator against all losses incurred by the Takaful Operator arising out of and/or in connection with the Agent's failure to disclose to the Takaful Operator facts within his knowledge and/or failure to relate to the Takaful Operator accurately facts disclosed to him relevant to the Takaful Operator's acceptance of the risk.
- This written contract constitutes the whole agreement between the parties herein.
- This Contract shall unless the Takaful Operator otherwise consents in writing supersede abrogate and annul any contract or relationship heretofore held by the Agent with the Takaful Operator, as agent, broker or otherwise. The provisions of this clause shall not apply to any existing Agency Leader's Contract entered into between the Agent and the Takaful Operator.
- All modifications to this Contract shall have no force or effect unless and except as they are expressed in writing, and duly executed by the Takaful Operator and the Agent except where such change is required by virtue of statutory change. All changes to the Agent’s Schedule of Commissions in whole or in part shall be made after consultation with the relevant Agency Association.
- This Contract may be terminated by the Takaful Operator upon the Takaful Operator being satisfied after due investigation of the occurrence of any of the following events:
- If the Agent does not meet training, production, persistency or other requirements in respect of the Agent's operations which may be set by the Takaful Operator, Bank Negara Malaysia (BNM), the Malaysian Takaful Association (MTA), and/or any other corresponding regulatory entity of competent authority from time to time;
- In the event of fraud, dishonesty, breach of trust, any unlawful conduct or the institution of voluntary or involuntary proceedings by or against the Agent in bankruptcy or under insolvency laws or for a receivership, or the composition with creditors by the Agent;
- If the Agent breaches any of the Terms, Conditions or provisions of this Contract or in any way whether expressly or impliedly fails to comply with any such Terms, Conditions or Provisions;
- Should the Schedule referred to in Clause 1 hereof cease to subsist;
- Should the Agent act in any way contrary to the interest of the Takaful Operator and its certificate holders;
- If the Agent makes a misrepresentation to any person in securing family takaful business or in inducing the Takaful Operator to accept a proposal;
- If the Agent violates or breaches the Takaful Operator’s Code of Ethic and Market Conduct Guidelines, MTA’s Code of Ethics and Conduct or any other code, guideline, rule or law that may be applicable from time to time as issued by the relevant regulatory authorities;
- If the Agent’s agency contract with any of the Takaful Operator’s affiliates is terminated due to fraud, dishonesty, breach of trust, any unlawful conduct, misrepresentation or violation or breaches of Code of Conduct, guideline, circular, rule or law;
- Such other reasons or grounds as may be determined by the Takaful Operator from time to time after due consultation with the relevant Agency Association and which is notified to the affected Agent in writing.
The Takaful Operator shall have the right to suspend the Agent from performing functions under this Agreement during any investigation by the Takaful Operator into any allegations or complaints against the Agent for such reasonable period as the Takaful Operator deems necessary for purposes of concluding its investigations. During the period of suspension, any commission or other payments which are payable to the Agent shall be withheld from payment to the Agent by the Takaful Operator (“the Withheld Sum”) with due notice to the effected Agent and Leader for a period of twenty one (21) working days pending the outcome of the investigation for the purpose of reimbursing the monies at risk, possible loss or recovery. In cases where the amount at risk is quantifiable, this amount shall be the Withheld Sum. In the event that:
- The investigations find that the Agent has not caused any loss to the Takaful Operator, then the Withheld Sum shall be released to the Agent;
- The investigations find that the Agent has caused loss to the Takaful Operator, then without prejudice to the Takaful Operator’s other rights against the Agent, the Takaful Operator shall be entitled to set-off the amount of its loss against the Withheld Sum before releasing the balance amount of the Withheld Sum, if any, to the Agent.
Subject to sooner termination of this Contract by the Takaful Operator in accordance with Clause 25 hereof, this Contract may be terminated:
- By the withdrawal of the Takaful Operator from the territory in which the Agent is operating;
- By the Agent upon 15 days' notice in writing without any reason being given therefore; or
- By the death of the Agent.
If this Contract is terminated by the death of the Agent and provided that no assignment has been made by the Agent in accordance with this Contract, the established new and service commission rights hereunder of the estate of the Agent shall not be affected except that payment made to such estate shall be reduced by the amount of any indebtedness due to the Takaful Operator and the Agency Leader shall have the right to assign a new servicing agent for all certificate holders who are the customers of the deceased Agent.
In the event that this Contract is terminated for any reason whatsoever, the Agent undertakes that at any time within two (2) years from such termination not to solicit or induce, whether directly or indirectly, any certificate holder of the Takaful Operator to cancel, amend or reduce any Certificate, Supplementary Contract or Endorsement and irrespective of any other rights the Takaful Operator may have in the event of breach of this clause or any Guidelines, Requirements, Resolutions, Directives, however called, etc. by BNM, MTA and/or any other corresponding regulatory entity of competent authority, the Takaful Operator shall have the right to withhold any monies otherwise due to the Agent.
- In the event the Agent fails to provide services to any certificate holders who is the Agent’s customers after the Agent has been requested to do so in writing by the Takaful Operator three (3) consecutives times with notice to the Leader, the Leader shall have the right to assign the affected certificate holder to himself or to another agent of the Takaful Operator PROVIDED ALWAYS that the commissions and any overriding will remain with the sitting Agent and his respective Leader.
- The Leader shall also have the right to assign the Agent’s customer to another agent in the event the Agent is no longer able to service the certificate holders due to valid reasons for example the Agent became incapacitated, PROVIDED ALWAYS that the Agent will continue to receive commission in relation to the affected certificate holder(s). Providing service shall include but not limited to assisting the certificate holder making enquiries on their certificate, effecting change of information and claims.
- In the event the Takaful Operator assigns a certificate holder to the Agent and the Agent fails to provide services at least once a year to the said certificate holder or if the said certificate holder has not participated in any new takaful plan through the assigned Agent within three (3) years from the date it was assigned to the Agent, the Leader shall have the right to reassign the affected certificate holder to himself or to another agent of the Takaful Operator PROVIDED ALWAYS that the commissions, if any will be due to the Agent who the certificate has been assigned or reassigned to, as the case may be, and any overriding will be payable to the respective Leader whose Agent the certificate was assigned or reassigned to, as the case may be.
- The Agent shall act and conduct himself in strict compliance with the terms and conditions of this Contract.
Any failure or omission on the part of the Takaful Operator to take any immediate action on any breach of any of the Terms and Conditions of this Contract on the part of the Agent shall not be construed as a waiver of the Takaful Operator's rights to terminate this Contract forthwith or pursue any remedies available to it under the laws in force from time to time, or be construed as consent or permission granted to the Agent not to act in accordance with this Contract. The Agent further agrees to observe all rules, guidelines, conditions, policies, directives, and circulars including the Takaful Operator's Market Conduct Guidelines promulgated from time to time by the Takaful Operator.
- The Agent shall comply with all laws, regulations, statutory requirements and industry guidelines including but not limited to Resolutions, Notices, directions and circulars issued by BNM, MTA and/or any other corresponding regulatory entity of competent authority as may be amended from time to time. The Agent shall further comply with guidelines, conditions, policies, directives or circulars of the Takaful Operator including the Takaful Operator's Market Conduct Guidelines (if any) currently in force and as issued by the Takaful Operator from time to time and meet any activity requirement, training, production, persistency or other requirements in respect of the Agent's operation which may be set by the Takaful Operator or the Government of Malaysia from time to time.
- Except for termination of this Contract caused by the death of the Agent as provided under Clause 27(c), in all other instances of termination, upon such termination, all of the Agent's rights to commissions, bonuses, incentives or any other payment, based on all contributions payable thereafter shall forthwith cease.
- This Contract shall be assignable by the Takaful Operator in whole or in part to any successor or affiliated company. However, the Agent shall not assign or purport to assign any right or interest, which the Agent may have herein without the prior consent of the Takaful Operator. Such consent by the Takaful Operator to any assignment shall not create or imply any acknowledgement or responsibility on the part of the Takaful Operator as to the validity, effect or sufficiency of such assignment.
- Nothing contained herein shall be construed to create the relation of employer and employee whether expressly or impliedly between the Takaful Operator and the Agent.
- The Agent hereby agrees that upon his ceasing to be an Agent of the Takaful Operator whether by effluxion of time or otherwise, the Takaful Operator shall be entitled to publish notices in the local newspapers, and/or in any electronic medium or despatch correspondence notifying its certificate holders and the general public that the Agent has ceased to be an agent of the Takaful Operator and is therefore not authorised to solicit any takaful business on behalf of the Takaful Operator or collect any contributions or other payments on behalf of the Takaful Operator if in any way its binds the Takaful Operator.
- The Agent shall at all times during the continuance of this Contract have in his possession a valid Authorisation Card issued by MTA authorising the Agent to solicit takaful business on behalf of the Takaful Operator and the Agent shall produce the Authorisation Card for inspection when so required by any certificate holder of the Takaful Operator or any member of the general public wishing to take out takaful with the Takaful Operator.
- The Agent shall use the Authorisation Card only when identifying himself as an Agent of the Takaful Operator for the purposes as specified in Clause 36(a) above and shall not use it for any other purpose.
The Agent shall ensure that he is fit and proper to carry out his obligations under this Contract and always conduct his takaful business with professionalism, fairness, integrity and honesty.
- The Agent shall act in the best interests of the prospective certificate holder, placing the interest of the certificate holders before his own interests. The Agent shall make full and adequate disclosure of all facts necessary for the certificate holders to make an intelligent decision, giving due consideration to the prospective certificate holder's investment objectives, financial situation and particular needs and continue to provide post-distribution services to the certificate holders and their beneficiaries.
- By entering into this contract, the Agent warrants and represents that he is not a proxy Agent for any third party, and shall during the subsistence of this Contract refrain from using either directly or indirectly another individual or entity to contract with such third party whereby business will be channelled away from the Takaful Operator, which may impliedly or expressly be construed as being a proxy agent relationship.
- Any notice given by either party thereto shall be deemed to have been sufficiently given if sent by facsimile or other electronic medium to the party's known facsimile or electronic mail-box number or by registered post to the last known address of the Agent or the address as appearing herein or to the registered office address of the Takaful Operator's office as the case may be. A notice shall be deemed to have been received by the party to whom it is addressed in the case of a facsimile or electronic medium, on the date it is sent but provided that a signed hard copy of such facsimile or electronic message will be sent in addition to the facsimile or electronic message, and in the case of notice by registered post, two (2) calendar days after the notice is posted (excluding the date of posting).
- The headings used in this Contract are for reference only and do not affect the construction of this Contract or have any binding legal effect.
- Where the context so permits words importing the singular number only shall include the plural number and vice versa and words importing the masculine gender only shall include the feminine gender and neuter gender.
- This Contract shall be construed and governed by the laws in force in Malaysia.
- The parties have hereunto agreed that the effective date of commencement of this Contract shall be 01-01-1992
COMMISSION (Applicable to Family Takaful, Group Takaful and Annuities Only)
APPLICABLE TO FAMILY TAKAFUL, GROUP TAKAFUL AND ANNUITIES
AGENT TO REPRESENT TAKAFUL OPERATOR
AGENT AS TRUSTEE
REPORTS BY AGENT
DELIVERY OF CERTIFICATE
NO ALTERATIONS OF DOCUMENTS
LIMITATIONS ON AGENT’S AUTHORITY
RETURN OF DOCUMENTS AND DATA BY AGENT
NO ADVERTISING OR PUBLICATION BY AGENT
NO INDUCEMENT BY AGENT
AGENT'S DUTY TO DISCLOSE AND INDEMNIFY
TERMINATION AND SUSPENSION
FAILURE OF AGENT TO SERVICE THE CERTIFICATE HOLDERS
COMPLIANCE WITH CONTRACT
COMPLIANCE WITH LAWS, REGULATIONS AND GUIDELINES
CESSATION OF AGENTS RIGHTS UPON TERMINATION OF CONTRACT
AGENT NOT AN EMPLOYEE
RIGHT OF TAKAFUL OPERATOR TO ADVERTISE
CONDUCT OF FAMILY TAKAFUL BUSINESS
SERVICE OF NOTICE