Why Should I Buy the RIA Registrar, LLC Sponsored E&O Insurance?

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1 Why Should I Buy the RIA Registrar, LLC Sponsored E&O Insurance? Easy Enrollment! Online Enrollment - Available 24/7 Sponsored By: RIA Registrar, LLC Who is Eligible to Enroll in this Program? Agents affiliated with RIA Registrar, LLC Limits of Liability: $1,000,000 Each Claim/$1,000,000 Aggregate Each Agent $1,000,000 Each Claim/$2,000,000 Aggregate Each Agent $1,500 Deductible (Applies to damages and defense): Coverage includes the Solicitation, Sale or Servicing of: Fixed Life and Health Fixed Annuities Also covered: Providing advice, consultation and administration of the above products, whether or not a fee is charged How can I find out more about this valuable coverage? It s Easy! Call our Customer Care Department at: (800) Monday through Friday 7 a.m. to 5 p.m. PST or go to: This document is a summary of the coverage provided. All statements contained herein are subject to all terms, Conditions and Exclusions of the actual policy. You can contact CalSurance Associates to receive a copy of this policy CalSurance R California License # 0B02587 CalSurance Associates RIARegIMOsFlr v2 Page 1 of 6

2 Agents Affiliated with RIA Registrar, LLC Agent s E&O Program Outline of Coverage Policy Period: September 1, 2012 to September 1, 2013 Insurer: Aspen Specialty Insurance Company (a member of The Aspen Group) A Non-Admitted Carrier Rated A (Excellent) XV, by A.M. Best Company The information obtained from A.M. Best dated October 12, 2011 is not in any way CalSurance Associates warranty or guaranty of the financial stability of the Insurer and the information is current only as of the date of the publication. Policy Number: LRA7EE Risk Purchasing Group Membership: By applying for this insurance, Agents are applying for membership in the Financial Sales Professionals Risk Purchasing Group, a group formed and operating pursuant to the Liability Risk Retention Act of 1986 (15 USC 3901 et seq.). There is no additional charge for membership. Limit of Liability: $1,000,000 Each Claim $1,000,000 Aggregate OR $1,000,000 Each Claim $2,000,000 Aggregate Deductible (Damages and Defense): $1,500 for all covered products Retroactive Date: The inception date of the Agent s first claims-made life insurance agents professional liability policy from which coverage has been maintained in force without interruption. Insured: 1) Agents Affiliated with RIA Registrar, LLC who have enrolled in the program and paid their premiums. 2) An entity owned and controlled by an Agent, but only for claims arising from the performance of Professional Services provided by the Agent; 3) An employee acting in his or her capacity as such on behalf of an Agent, arising solely from the performance of Professional Services by the Agent; 4) The legal heir, executor, administrator or legal representative of an Agent in the event of such Agent s death, incapacity or bankruptcy; Insured (cont d): 5) The lawful spouse or domestic partner of any individual which qualifies as an Insured under Sub-sections 1., 3., or 4., above, for a Claim arising solely out of spousal or domestic partner status, and not out of any alleged independent wrongful acts, of such individual; or 6) The Sponsoring Company, but only for its vicarious liability for the covered acts of an Agent. Coverage: The Insurer shall pay on behalf of the Insured all sums in excess of the deductible which the Insured shall be legally obligated to pay as Damages resulting from Claims first made for any actual or alleged negligent act, error or omission solely while performing Professional Services for others, including Personal Injury. Professional Services: The solicitation, sale or servicing of: a) Fixed Life & Health Insurance b) Fixed Annuities Extended Reporting Period: If, during the Policy Period, the Sponsoring Company terminates an Agent s contract, the insurance for such Insured shall continue until the end of this Policy Period. If, during the Policy Period, an Agent retires or becomes disabled or deceased, the Agent or its legal representative may elect to purchase an Extended Reporting Period - 3 years: 200% of last annual premium - 5 years: 300% of last annual premium - Unlimited: 400% of last annual premium Claims Administrator: Lancer Claims Services 681 S. Parker St. #300 Orange, CA (800) Program Administration: CalSurance Associates California License #0B02587 Please review the attached program materials. A complete copy of the specimen policy is available by calling or by visiting RIAReg(IMOs)_HL_ v2 CalSurance Associates California License # 0B02587 Page 2 of 6

3 EXCLUSIONS This Policy does not apply to any Claim based upon, arising out of, directly or indirectly, or in any way involving A. Any dishonest, fraudulent, criminal, malicious or purposeful act, error or omission committed by or at the direction of an Insured; however, notwithstanding the foregoing, the Insured shall be afforded a defense, if these allegations arise out of Wrongful Acts otherwise covered under this Policy, until the allegations are subsequently proven by a final adjudication or if the Insured admits such allegation. In such event, the Insured shall reimburse the Insurer for all Claims Expenses incurred by the Insurer. B. Any Claim brought or maintained, directly or indirectly, by or on behalf of any: 1) Insured; however this Exclusion shall not apply to any alleged Wrongful Termination; 2) Insurer or Broker-Dealer; 3) Insurance agent or broker; 4) Entity that is not a client of an Insured; however, this Exclusion shall not apply to any Claim brought by an entity who is an alleged beneficiary, heir, executor or administrator of a deceased client of an Insured; 5) Any entity which an Insured owns, operates, controls or manages; or 6) Any governmental or quasi-governmental entity, or Self- Regulatory Organization including, but not limited to, any state or federal insurance or securities commission or agency, or the Financial Industry Regulatory Authority or the Securities and Exchange Commission,; however, this Exclusion shall not apply to a Claim brought by or on behalf of such entity in its capacity as a client of an Insured or to the extent it is inconsistent with Section II.A.EXTENSIONS OF COVERAGE. C. Any fact, circumstance, or situation which has been the subject of any written notice given under any insurance policy issued by any insurer, including any policy of which this Policy is a renewal or replacement. D. Any Claim, demand, suit, litigation or other proceeding against any Insured which was pending on or existed prior to the inception of the Policy Period, or the same or substantially the same facts, circumstances or allegations which are the subject or the basis for such Claim, demand, suit, litigation or other proceeding. E. Any Wrongful Act or Interrelated Wrongful Acts first occurring before the applicable Retroactive Date, even if the Wrongful Act or Interrelated Wrongful Acts continue after the Retroactive Date. F. Any services as, or which may only be performed by, an accountant, actuary, lawyer, real estate agent/broker, property/casualty insurance agent, or third-party claims administrator. G. Any placement of a client s coverage or funds directly or indirectly with any entity which is not licensed to conduct business in the state or jurisdiction with authority to regulate such business; however, this Exclusion shall not apply to the placement of a client s coverage or funds directly or indirectly with an eligible surplus lines insurer in the state or jurisdiction with authority to regulate such business. H. Any ownership, formation, sale, servicing, operation, or administration of any insurance company, health maintenance organization, preferred provider organization, captive, risk retention group, self-insurance group/program, or purchasing group. I. Any sale, servicing, or administration of, or advice or planning with respect to, any Multiple Employer Welfare Arrangement. J. Any pension, profit sharing, health/welfare or other employee benefit plan, insurance plan or trust, sponsored by an Insured as an employer. K. Any financial inability or refusal to pay, insolvency, receivership, bankruptcy, or liquidation of any entity in which an Insured has placed or recommended to be placed, coverage or the funds of a client; however, this Exclusion shall not apply to any insurer that was rated A- or better by A.M. Best at the time of the Insured s acts. L. An Insured s inability or refusal to pay or collect premium, claim or tax monies. M. Any liability of others assumed by an Insured under any contract or agreement, unless such liability would have attached to an Insured even in the absence of such an agreement; or any guarantees or warranties. N. Any gaining of any personal profit or advantage to which an Insured is not legally entitled, or any disputes involving an Insured s fees, charges, entitlements, or other compensation. O. Any commingling or use of client funds or accounts. P. Any willful violation of the rules or regulations of the Financial Industry Regulatory Authority, Securities and Exchange Commission, Securities Act of 1933, Securities Exchange Act of 1934, Investment Company Act of 1940, or the Investment Advisors Act of 1940 and any amendments thereto, or of any state securities statute or state regulatory agency. Q. Any Security(ies). R. Any insurance or financial product owned in whole or in part by an Insured. S. Any structured settlements. T. Any bodily injury, sickness, disease, emotional distress, mental anguish, outrage, humiliation or death; or injury to or destruction of any tangible property, including loss of use thereof. U. Any discrimination, harassment, or misconduct by an Insured because of race, creed, color, age, gender, sex, sexual preference or orientation, national origin, religion, disability, handicap, marital status, or any other class protected under federal, state, local or other law; or by an employee, former employee, or job applicant, of an Insured in their capacity as such. V. Any infringement of copyright; plagiarism, piracy or misappropriation of ideas; or infringement of title, slogan, trademark, trade name, trade dress, service mark or service name; or any patent or trade secret; or any unfair competition, deceptive advertising, anticompetitive acts, restraint of trade, price fixing, or antitrust. W. 1) Promissory notes, issuer callable Certificates of Deposits, or step-up or step down Certificates of Deposits; 2) Viatical or life settlements, reverse mortgages, or any similar transaction in which the present value of a conditional contract is exchanged or sold; or 3) Tangible personal property, including but not limited to, any precious metals, gemstones, stamps, sports or other cards, antiques, jewelry, coins or other collectibles; however, this Exclusion shall not apply to gold or silver. RIARegIMOS_EXCL_ v1 CalSurance Associates California License # 0B02587 Page 3 of 6

4 Agents Affiliated with RIA Registrar, LLC Enrollment Form Claims Made and Reported Errors and Omissions Coverage Policy Period: September 1, 2012 to September 1, 2013 By purchasing this insurance, agents become members of the Financial Sales Professionals Risk Purchasing Group, a group formed and operating pursuant to the Liability Risk Retention Act of 1986 (15 USC 3901 et seq.). There is no additional charge for membership. Instructions: Complete all sections of this form and mail to: CalSurance Associates, P.O. Box 7048, Orange, CA Questions: Call CalSurance Associates at (800) or at info@calsurance.com 1. Your Information Please Print Clearly First Name: M.I.: Last Name: Street Address: City: State: Zip Code: Daytime Phone: Fax: Program Options Effective Date of Coverage: Select Limits of Liability: $1,000,000 per claim; $1,000,000 aggregate $1,000,000 per claim; $2,000,000 aggregate Products Covered (See Outline of Coverage for Details): Agent s E&O Coverage (Life and Health Insurance and Fixed Annuities) Please refer to the Outline of Coverage for limit and coverage details. $ Calculate Total Amount Due: Premium for Selected Options (See Premium Chart) X Surplus Lines Tax Factor (See Enclosed Chart) + $70.00 Admin Fee/Co-Marketing Fee = Total Amount Due 3. Payment Payment in Full by Check: Check made payable to CalSurance Associates for the full premium due. To pay in full by credit card or ACH Debit, please enroll online at: 4. Warranty Statement - Signature Required (IMPORTANT) I understand and agree to the following: I must be affiliated with RIA Registrar, LLC. (Sponsor). Otherwise, I will not be considered an insured under this policy, and claims made against me will not be covered. If I am currently affiliated with the Sponsor, paying a premium for coverage under this program, such premium is subject to a 10% short rate penalty should I decide to cancel for any reason. Should my contract terminate for any reason, coverage will continue until the end of the policy period. This is a claims made and reported policy. I have no knowledge of any pending claim or incident that could give rise to a claim under the proposed policy, and if any such claim exists, or knowledge or information exists and any claim or action arises therefrom, it is excluded from coverage for which this enrollment form applies. A potential gap in coverage may occur if I elect an effective date that is not continuous with my prior expiration date, and may result in denial of a claim. Agent s Signature: Today s Date: RIAReg(IMOs)App v1 CalSurance Associates California Insurance License 0B02587 Page 4 of 6

5 Agents Affiliated with RIA Registrar, LLC E&O Program Premium Chart Program Effective: September 1, 2012 to September 1, 2013 Limit of Liability (per Claim/Aggregate) Effective Month $1,000,000/$1,000,000 $1,000,000/$2,000,000 September, 2012 $410 $451 October, 2012 $377 $414 November, 2012 $342 $376 December, 2012 $309 $339 January, 2013 $274 $301 February, 2013 $239 $263 March, 2013 $206 $227 April, 2013 $172 $189 May, 2013 $138 $152 June, 2013 $104 $114 July, 2013 $ 70 $ 77 August, 2013 $ 35 $ 39 Above rates do not include the $70 administrative/co-marketing fee or the surplus lines tax, which is based on your primary state of residence. RIAReg(IMOs)Marix v1 CalSurance Associates California License # 0B02587 Page 5 of 6

6 Premium Tax Chart Surplus Lines and Stamping Fees Worksheet - As of August 2012 State Surplus Lines Multiplier~ State Surplus Lines Multiplier~ Alabama Nebraska Alaska Nevada * Arizona New Hampshire Arkansas New Jersey California New Mexico Colorado New York Connecticut North Carolina DC North Dakota Delaware Ohio Florida Oklahoma Georgia Oregon Hawaii Pennsylvania ** Idaho * Puerto Rico Illinois ^ Rhode Island Indiana South Carolina Iowa South Dakota Kansas Tennessee Kentucky Municipal/County Tax Texas Louisiana Utah Maine Vermont Maryland Virginia Massachusetts Washington Michigan Washington, DC Minnesota West Virginia Mississippi Wisconsin Missouri Wyoming Montana * States with an * are states that DO NOT return stamping fees in the case of cancellation. 2. Illinois ^ requires premium tax and stamping fee be rounded to nearest whole dollar. 3. Kentucky+ also has Municipal/County tax which varies by location. Contact CalSurance Associates at to determine correct tax. 4. Surplus Lines Multipliers~ are inclusive of the state specific Surplus Lines tax, stamping fees, surcharges, and Municipal/County taxes. RIAIMOs-SL v1 CalSurance Associates California License # 0B02587 Page 6 of 6