1. Purpose
   To recognize and reward brokers who maintain and grow a stable block of business.
2. Eligibility
   Any broker who has annualized in-force commissionable fully insured premium with Delta Dental of New Jersey ("Delta") groups totaling at least $500,000 and less than $5,000,000 at the end of the prior calendar year ("Total Book of Insured Business") and whose Incentive Commission Base equals or exceeds $250,000.
3. Incentive Commission Rate
   Incentive Commission Rate depends upon the size of the broker's Total Book of Insured Business at the end of the prior calendar year.
   
   

   Total Book of Insured Business for the Prior Calendar Year	Incentive Commission Rate for the Current Calendar Year
   $500,000 - $999,999	.5%
   $1,000,000 - $4,999,999	1%

   
   
4. Incentive Commission Base
   The Incentive Commission Base is the "Net" annualized increase in fully insured premiums for groups which are new to Delta and for which the broker has received commissions in the current calendar year, offset by annualized premium losses in fully insured business during the same calendar year.
5. Incentive Commission
   The Incentive Commission is the Incentive Commission Rate (#3) for the current year applied to the Incentive Commission Base (#4) for the current year.
6. Delta's Right to Amend or Terminate Program
   Delta reserves the right to amend or discontinue this program at any time. In the event of a termination of the program, Delta will not be liable for any incentive commissions which would otherwise have accrued after the date of termination of the program.
7. Mergers
   In the event of a merger of brokers' businesses, Delta will separately calculate and pay incentive commissions for the calendar year in which the merger occurred.
8. Interpretation
   Delta reserves full discretion with respect to any interpretation of the Incentive Program.

How the Broker Incentive Program Works

Broker	Broker's Total Book of Insured Business (See #2, page 2)	Broker's Corresponding Incentive Commission Rate (See #3, page 2)	Broker's Incentive Commission Base (See #4, page 2)	Broker's Incentive Commission (See #5, page 2)
X	$650,000	.5%	Net new annualized fully insured business premium ($400,000) less loss of fully insured business ($100,000) = $300,000	$300,000 x .005 = $1,500
Y	$1,000,000	1%	Net new annualized fully insured business premium ($750,000) less loss of fully insured business ($250,000) = $500,000	$500,000 x .01 = $5,000
Z	$2,000,000	1%	Net new annualized fully insured business premium ($600,000) less loss of fully insured business ($400,000) = $200,000	None - incentive is paid only where the Incentive Commission Base totals $250,000 or more. See #2 and #4

 

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Broker Override Program - Amended Effective January 1, 2001

1. Purpose
   To recognize and reward brokers who maintain and increase their significant block of insured business.
2. Eligibility
   Any broker who has received commissions from Delta Dental of New Jersey ("Delta") for fully insured groups whose premiums totaled at least $5,000,000 during the prior calendar year.
3. Override Commission Rate
   The Override Commission Rate increases with the size of the broker's annual fully insured premium during the prior calendar year ("Total Book of Insured Business").
   
   

   Total Premiums for Insured Business for the Prior Calendar Year	Override Commission Rate for the Current Calendar Year
   $5,000,000 - $9,999,999	2%
   $10,000,000 - $14,999,999	4%
   $15,000,000 +	5%

   
   
4. Override Commission Base
   The Override Commission Base is commissionable net fully insured premium for which the broker has received commissions from Delta in the current calendar year. The first twelve months of commissions are not counted where the group was not new to Delta. The premium will be prorated to the number of months the coverage was in force. "Net" means offset by prorated losses in fully insured business during the same calendar year.
5. Override Commission
   The Override Commission for the current year is the Override Commission Rate applied to Override Commission Base.
6. Delta's Right to Amend or Terminate Program
   Delta reserves the right to amend or discontinue this program at any time. In the event of a termination of the program, Delta will not be liable for any incentive commissions which would otherwise have accrued after the date of termination of the program.
7. Mergers
   In the even of a merger of brokers' businesses, Delta will separately calculate and pay incentive commissions for the calendar year in which the merger occurred.
8. Interpretation
   Delta reserves full discretion with respect to any interpretation of the Incentive Program.

How the Broker Override Program Works

Broker	Broker's Total Book of Insured Business (See #3, page 3)	Broker's Corresponding Override Commission Rate (See #3, page 3)	Broker's Override Commission Base (See #4, page 3)	Broker's Incentive Commission (See #5)
X	$5,600,000	.2%	Net increase in insured business premium ($1.5 million new business) less loss of fully insured business ($.4 million) = $1.1 million	$1,100,000 x .02 = $22,000
Y	$7,500,000	2%	Net increase in insured business premium during 2001 ($2.5 million new business) less loss of insured business ($.7 million) = $1.8 million	$1,800,000 x .02 = $36,000
Z	$11,000,000	4%	Net increase in insured business premium ($4.0 million) less loss of fully insured business ($4.5 million) = no net override commission base	0 x .04 = no override commission