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Olympus MGA LSA


    Laura Pearce

This review exclusively focuses on major issues of concern to insurance agencies and does not address general contract issues or provisions of the contract that contain boilerplate language.   

Items of Concern 

  • Allows MGA to amend the commission schedule in its sole discretion upon written notice to the Producer, but does specify how many days notice is required.
  • Indemnification and hold harmless language in multiple provisions is not fair and mutual. 

Provision-by-Provision Review

Structure corresponds to the lettered and/or numbered paragraphs of the contract (PDF).

(2) a. Allows MGA to amend the commission schedule in its sole discretion upon written notice to Producer.  Does not specify how many days notice must be given.

(6) Provides that if Producer does not return Company supplies to Company/MGA immediately upon written demand of Company/MGA, then Producer must agree to indemnify and hold harmless the Company/MGA for damages assessed directly or indirectly against Company/MGA as a result.  Does not include the comparative negligence language: “except to the extent caused by MGA.”

(8) Provides that if Producer uses the Company/MGA name in any advertisement or statement without the consent of the Company/MGA and later Company/MGA is subjected to loss or expense as a result of the unauthorized use, then Producer shall be liable to Company/MGA for all ensuing damages, costs and attorneys’ fees.  Similar to paragraph (6) above, the language does not include the comparative negligence language: “except to the extent caused by MGA.”

(9) Provides that at termination of the Agreement, Producer owns expirations unless the Producer is in default of accounts payable to Company or has not surrendered Company supplies.

(10) Provides that if Producer is in default of the Agreement, then Producer cannot sell its records, expirations and ANY other thing of value in the Producer’s agency without written consent of MGA.  Seems to be broader than records and expirations pertaining to policies written by the Company/MGA, and even if limited to those policies, it seems to conflict with Producer’s ownership of expirations granted in paragraph (9) above.

(15) C) 1) Provides that the Agreement shall immediately terminate if the Producer fails to pay any funds owing to the Company for ANY REASON within seven days plus three days for mailing after a request has been made by Company/MGA.

(15) C) 4) Provides that the Agreement shall immediately terminate if Producer or any of its employees pleads guilty or no contest to a felony or a crime involving moral turpitude.  However, the language does allow for the Producer to appeal the termination if the conviction involves an employee of the Producer, but does not set forth a procedure for that appeal.

(15) E) Allows for either party to terminate the Agreement upon 15 days prior notice to the other party.

(16) Indemnification and hold harmless language is not mutual.  Requires Producer to indemnify and hold harmless the MGA for any action of the Producer that violates the law or is an error or omission.  However, the language requires the MGA to indemnify and hold harmless the Producer only when the MGA violates the law (but not for an error or omission of the MGA).  Also the language does not include the comparative negligence language in either paragraph: “except to the extent caused by [the other party]”

FAIA’s Office of the General Counsel provides this contract review only for general information and comments. It is not intended to answer specific individual legal, business, or other questions. It was prepared solely for use as a guide, is not a substitute for the Agent’s/Agency’s independent evaluation of any provision in a contract, and is not a recommendation that the contract be signed, revised or rejected. Any communication you have with the Company regarding this contract should be an individual communication, and not on behalf of a group of agencies or through FAIA. If specific legal or other expert advice is required or desired, please seek the services of an appropriate, competent professional, such as a licensed Florida attorney familiar with the Florida Insurance Code. 


Reviewed October 2013

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