EXPERIENCE ACCOUNT Clause Samples

EXPERIENCE ACCOUNT. A notional experience account (the "Experience Account") shall be calculated by the Reinsurer from the Effective Date and maintained until all obligations of the Reinsurer under this Agreement have been satisfied or discharged in full. The balance of the Experience Account (the "Experience Account Balance") as of any date shall be determined as (i) the sum of the amounts of the Deposit Premium and the Reinsurance Premium less (ii) the Reinsurer's Margin less (iii) the Subject Obligations paid by the Reinsurer plus (iv) the amount of the Interest Credit, each determined as of such date.

EXPERIENCE ACCOUNT. In the event incurred Losses from Section 1 (Ag PI) exceed 200% of Net Written Premium for the period 5/1/98 to 1/1/99, an experience calculation will be prepared and the Company will pay the Reinsurer interest at the rate of 12 Months LIBOR Rate as published in the Midwest Edition of "The Wall Street Journal" on the first day of the calendar month in which the amount becomes due, plus 1.2% multiplied by the cumulative balance which exceeds 200% of the cumulative Net Written Premium Section 1 (Ag PI for the period 5/1/98 to 1/1/99) during the period. The product will then be multiplied by 1/365 for each day after the due date that the amount due remains unpaid. Any interest that occurs pursuant to this Article will be calculated by the party to which it is owed.

EXPERIENCE ACCOUNT. A notional experience account (the “Experience Account”) shall be created by the Reinsurer as of the Experience Refund Commencement Date and shall be maintained until all obligations of the Reinsurer in respect of the Additional Assumed Policies under the Reinsurance Agreement have been satisfied or discharged in full. As of the Experience Refund Commencement Date, the balance of the Experience Account (the “Experience Account Balance”) shall be zero.

EXPERIENCE ACCOUNT. (a) The Reinsurer shall establish as of the Effective Date and maintain on its books a notional experience account with respect to each Cedent (each an "Experience Account") until all obligations of the Reinsurer under this Agreement have been satisfied or discharged in full. (b) The balance of each Experience Account as of the end of each Accounting Period shall be an amount equal to: (i) the Initial Reinsurance Premium for the Cedent, plus (ii) the cumulative Funds Withheld Account Investment Income, plus (iii) Net Premiums applicable to such Cedent, plus (iv) cumulative additional Reinsurer Allowances applicable to Experience Trigger Events times 1.045 times the number of calendar days elapsed since individual payment dates divided by 365, less (v) amounts applied by the Cedent in payment of amounts due from the Reinsurer for the Reinsurer's liability under Section 2.3 with respect to Ultimate Net Loss (adjusted to reflect recoveries, salvages, subrogations or payments received by the Cedent), less (vi) the Initial Ceding Commission due the Cedent under the terms of this Agreement, less (vii) the cumulative Expense Allowances, less (viii) the cumulative Reinsurer Allowances, less (ix) with respect to Penn Treaty, the negative balance, if any, in the Experience Account maintained by the Reinsurer with respect to American Network, and less (x), with respect to American Network, the negative balance, if any, in the Experience Account maintained by the Reinsurer with respect to Penn Treaty. After January 1, 2010, item (iv) in the above calculation shall be zero. The Experience Accounts may be a negative number. In such event, the balance of the applicable Experience Account will be carried forward with interest at 1.125% per Accounting Period applied to the negative balance of such Experience Account at the beginning of such Accounting Period. The parties hereto agree and acknowledge that the Experience Account is a notional account and has no bearing on the statutory financial statements of either Cedent.

EXPERIENCE ACCOUNT. A. Within 30 days following the end of each calendar quarter, until all Aggregate Ultimate Net Losses recoverable hereunder have been fully paid, commuted or otherwise discharged, the Reinsurer shall report to the Company an experience account calculation as set forth herein. B. The experience account calculation shall be computed on a cumulative basis from the inception of this Agreement to the date of calculation, segregated by Accident Years, as follows: 1) 100% of all Minimum and Deposit Premium paid and adjustments thereto, less 2) Reinsurer’s margin (not applicable to Additional Premium), plus 3) Additional Premium(s) and accrued interest thereon, less 4) 100% of recoverable cumulative Ultimate Net Losses paid in excess of the Retention, plus 5) Interest, if any, as set out in the following paragraph.

EXPERIENCE ACCOUNT. 1. A notional "EXPERIENCE ACCOUNT" shall be created by the Reinsurer as at the Effective Date of this Agreement and shall be maintained by the Reinsurer until all obligations of the Reinsurer hereunder have been satisfied or discharged in full. 2. The balance of the Experience Account shall be calculated by the Reinsurer and as of any date shall be equal to: (a) $567,737,965.34 credited as of February 20, 2002 and $2,422,302 credited as of March 7, 2002, such amounts representing 100% of the Initial Premium actually transferred to and received by the Reinsurer on the Payment Date plus the Interest, plus (b) 100% of funds withheld payments made to Reinsurer (not including amounts deemed received due to set off of Ultimate Net Loss against the FWA by the Reinsurer) pursuant to Article 6, paragraph 3(a) or (b), plus (c) 100% of Net Subject Premiums received by the Reinsurer on or after the Effective Date, less (d) 100% of Ultimate Net Loss paid by the Reinsurer (not including amounts deemed received due to set off of Ultimate Net Loss against the FWA by the Reinsurer) ), less (e) 100% of the Reinsurer's Charge as set forth in Article 9 herein, less (f) 100% of any brokerage payments made by the Reinsurer, not to exceed $50,000 per annum for the first six years of this Agreement, plus (g) The cumulative Experience Account Investment Return applied to (a)-(f) above.

EXPERIENCE ACCOUNT. The Experience Account shall be calculated as follows:

EXPERIENCE ACCOUNT a. Experience Account beginning of period b. Interest on experience account as defined in c. Cash Flow (Reinsurance Premium less Reinsurance Benefits) d. Risk Charges e. DAC charges e. Experience Account end of period

EXPERIENCE ACCOUNT. A. The Reinsurer shall maintain an Experience Account, the balance of which shall be calculated as follows: