Common use of Risk Classification Changes Clause in Contracts

Risk Classification Changes. If a Policy was initially ceded to the Reinsurer on an automatic basis and if, following the consideration of new underwriting evidence, the Company makes a change to the risk classification in accordance with its underwriting guidelines, the same change will be made to the reinsurance coverage. If such change is being made on a facultatively reinsured policy, the change is subject to the Reinsurer's approval. If following the consideration of new underwriting evidence, the Company can place the Policy at a lower mortality rating or better underwriting class than that of the Reinsurer, then the Company will have the right to terminate the reinsurance. However, the Company will provide the Reinsurer an opportunity to quote anew and will use best efforts to maintain the existing reinsurance. Any such change affecting the reinsurance will be on a point-in-scale basis at the revised risk classification and effective with the date of the change. The Reinsurer will refund any unearned reinsurance premiums, net of reinsurance allowances, paid by the Company prior to the change of mortality rating or underwriting class as calculated on the date of the policy change.

Risk Classification Changes. If a Policy was initially ceded to the Reinsurer on an automatic or facultative obligatory basis and if, following the consideration of new underwriting evidence, the Company makes a change to the risk classification in accordance with its underwriting guidelines, the same change will be made to the reinsurance coverage. If such change is being made on a facultatively reinsured policy, the change is subject to the Reinsurer's ’s approval. If following the consideration of new underwriting evidence, the Company can place the Policy at a lower mortality rating or better underwriting class than that of the Reinsurer, then the Company will have the right to terminate the reinsurance. However, the Company will provide the Reinsurer an opportunity to quote anew and will use best efforts to maintain the existing reinsurance. Any such change affecting the reinsurance will be on a point-in-scale basis at the revised risk classification and effective with the date of the change. The Reinsurer will refund any unearned reinsurance premiums, net of reinsurance allowances, paid by the Company prior to the change of mortality rating or underwriting class as calculated on the date of the policy change.