Common use of Special Commutation Clause in Contracts

Special Commutation. A. The Company may require commutation of that portion of any loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if any remains, if the Subscribing Reinsurer is a Special Circumstance Reinsurer. "Outstanding claim or claims" shall include claims incurred but not reported, as established by the Company, including any billed yet unpaid claims. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the loss. The Subscribing Reinsurer shall then pay the amount requested within 10 days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 days of receipt of the Company's Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 days of receipt of the notification. Within 30 days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 days of the date of the Subscribing Reinsurer's Statement of Valuation, then each party shall appoint an actuary as party actuaries for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to agree upon an acceptable independent actuary within 15 days following the date of their appointment, the Company shall supply the Subscribing Reinsurer with a list of at least five proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "independent actuary" shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In the event that the Subscribing Reinsurer no longer meets the criteria set forth in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination of this Contract and/or a Subscribing Reinsurer's percentage share in this Contract.

Special Commutation. A. The Company may require commutation of that portion of any loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if any remains, if the Subscribing Reinsurer is a Special Circumstance Reinsurer. "“Outstanding claim or claims" ” shall include claims incurred but not reported, as established by the Company, including any billed yet unpaid claims. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the loss. The Subscribing Reinsurer shall then pay the amount requested within 10 days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 days of receipt of the notification. Within 30 days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's ’s Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 days of the date of the Subscribing Reinsurer's ’s Statement of Valuation, then each party shall appoint an actuary as party actuaries for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to agree upon an acceptable independent actuary within 15 days following the date of their appointment, the Company shall supply the Subscribing Reinsurer with a list of at least five proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "“independent actuary" ” shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In the event that the Subscribing Reinsurer no longer meets the criteria set forth in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination of this Contract and/or a Subscribing Reinsurer's ’s percentage share in this Contract.

Special Commutation. A. The Company may require commutation of that portion of any loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if any remains, if the Subscribing Reinsurer is a Special Circumstance Reinsurer. "“Outstanding claim or claims" ” shall include claims incurred but not reported, as established by the Company, including any billed yet unpaid claims. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the loss. The Subscribing Reinsurer shall then pay the amount requested within 10 days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 days of receipt of the notification. Within 30 days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's Reinsurers Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 days of the date of the Subscribing Reinsurer's Reinsurers Statement of Valuation, then each party shall appoint an actuary as party actuaries for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to agree upon an acceptable independent actuary within 15 days following the date of their appointment, the Company shall supply the Subscribing Reinsurer with a list of at least five proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "“independent actuary" ” shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In the event that the Subscribing Reinsurer no longer meets the criteria set forth in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination of this Contract and/or a Subscribing Reinsurer's Reinsurers percentage share in this Contract.

Special Commutation. A. The In the event a Subscribing Reinsurer meets one or both of the following criteria, the Company may require a commutation of that portion of any excess loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if any remains, if the . 1. The Subscribing Reinsurer’s A.M. Best’s rating is assigned or downgraded below A- (inclusive of “Not Rated” ratings) and/or Standard & Poor’s rating is assigned or downgraded below BBB+; or 2. The Subscribing Reinsurer is ceases assuming new or renewal property treaty reinsurance business. Notwithstanding the foregoing, the provisions of this Article shall not apply to Subscribing Reinsurers that (at the inception hereof) are rated A+ or higher by A.M. Best and have a Special Circumstance Reinsurerpolicyholders’ surplus (or the foreign equivalent thereto) of $2,000,000,000 or more. "“Outstanding claim or claims" ” shall include claims incurred but not reported, be defined as established by the Companyknown or unknown claims, including any billed yet unpaid claims. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss, including, but not limited to, paid losses, paid loss adjustment expenses, outstanding losses, outstanding loss adjustment expenses, incurred but not reported loss reserves established by the Company’s internal division or the appropriate actuarial firm under external contract to the Company, salvage and subrogation, and unearned reinsurance deposits, if any, and shall set forth or attach the information relied upon by the Company and the methodology methodology, including, but not limited to, the present value calculation employed to calculate the excess loss. The Subscribing Reinsurer shall then pay the amount requested within 10 30 calendar days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 30 calendar days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 30 calendar days of receipt of the notification. Within 30 45 calendar days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss, including, but not limited to, paid losses, paid loss adjustment expenses, outstanding losses, outstanding loss adjustment expenses, incurred but not reported loss reserves established by the Subscribing Reinsurer’s internal division or the appropriate actuarial firm under external contract to the Subscribing Reinsurer, salvage and subrogation, and unearned reinsurance deposits, if any, and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology methodology, including, but not limited to, the present value calculation employed to calculate the excess loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's ’s Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 30 calendar days of the date of the Subscribing Reinsurer's ’s Statement of Valuation, then each party shall appoint an actuary as party actuaries arbitrators for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to cannot agree upon on an acceptable independent actuary within 15 30 calendar days following of the date of their appointmentthe Subscribing Reinsurer’s Statement of Valuation, the Company shall supply the Subscribing Reinsurer with a list of at least five three proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 calendar days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "“independent actuary" ” shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In Notwithstanding paragraphs A, B and C above, in the event that the Subscribing Reinsurer no longer meets the criteria set forth in subparagraphs 1 and 2 of paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for any outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article Article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination or expiration of this Contract and/or a Subscribing Reinsurer's percentage share in this Contract.

Special Commutation. A. The In the event a Subscribing Reinsurer meets one or both of the following criteria, the Company may require a commutation of that portion of any excess loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if any remains, if the . 1. The Subscribing Reinsurer’s A.M. Best’s rating is assigned or downgraded below A- (inclusive of “Not Rated” ratings) and/or Standard & Poor’s rating is assigned or downgraded below BBB+; or 2. The Subscribing Reinsurer is ceases assuming new or renewal property treaty reinsurance business. Notwithstanding the foregoing, the provisions of this Article shall not apply to Subscribing Reinsurers that (at the inception hereof) are rated A+ or higher by A.M. Best and have a Special Circumstance Reinsurerpolicyholders’ surplus (or the foreign equivalent thereto) of $2,000,000,000 or more. "“Outstanding claim or claims" ” shall include claims incurred but not reported, be defined as established by the Companyknown or unknown claims, including any billed yet unpaid claims. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss, including, but not limited to, paid losses, paid loss adjustment expenses, outstanding losses, outstanding loss adjustment expenses, incurred but not reported loss reserves established by the Company’s internal division or the appropriate actuarial firm under external contract to the Company, salvage and subrogation, and unearned reinsurance deposits, if any, and shall set forth or attach the information relied upon by the Company and the methodology methodology, including, but not limited to, the present value calculation employed to calculate the excess loss. The Subscribing Reinsurer shall then pay the amount requested within 10 30 calendar days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 calendar days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 calendar days of receipt of the notification. Within 30 calendar days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss, including, but not limited to, paid losses, paid loss adjustment expenses, outstanding losses, outstanding loss adjustment expenses, incurred but not reported loss reserves established by the Subscribing Reinsurer’s internal division or the appropriate actuarial firm under external contract to the Subscribing Reinsurer, salvage and subrogation, and unearned reinsurance deposits, if any, and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology methodology, including, but not limited to, the present value calculation employed to calculate the excess loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's ’s Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 calendar days of the date of the Subscribing Reinsurer's ’s Statement of Valuation, then each party shall appoint an actuary as party actuaries arbitrators for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to cannot agree upon on an acceptable independent actuary within 15 calendar days following of the date of their appointmentthe Subscribing Reinsurer’s Statement of Valuation, the Company shall supply the Subscribing Reinsurer with a list of at least five three proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 calendar days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "“independent actuary" ” shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In Notwithstanding paragraphs A, B and C above, in the event that the Subscribing Reinsurer no longer meets the criteria set forth in subparagraphs 1 and 2 of paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for any outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article Article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination or expiration of this Contract and/or a Subscribing Reinsurer's percentage share in this Contract.

Special Commutation. A. The In the event a Subscribing Reinsurer meets one or more of the following conditions, the Company may require a commutation of that portion of any excess loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if : 1. The Subscribing Reinsurer’s A.M. Best’s rating has been assigned or downgraded below A- (including any remains, if the “Not Rated” rating) and/or Standard & Poor’s rating has been assigned or downgraded below BBB+ (includes any “NR” rating); or 2. The Subscribing Reinsurer is a Special Circumstance Reinsurerhas ceased assuming new and renewal property and casualty treaty reinsurance business. "“Outstanding claim or claims" ” shall include claims incurred but not reported, be defined as established by the Companyknown or unknown claims, including any billed yet unpaid claims. However, unless otherwise mutually agreed, this paragraph A shall not apply unless the outstanding claim or claims is for an amount not less than $5,000. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the excess loss. The Subscribing Reinsurer shall then pay the amount requested within 10 30 calendar days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 calendar days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 calendar days of receipt of the notification. Within 30 calendar days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the excess loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's Statement of Valuation of the outstanding claim or claims is viewed If agreement, as unacceptable to the Companyoutlined in paragraphs A, the Company may B and C, cannot be reached, either party can abandon the commutation effort, or the Company and the Subscribing Reinsurer may seek to settle any difference by using mutually appointing an independent actuary agreed to by the partiesactuary. E. If the parties cannot agree on an acceptable independent actuary within 15 calendar days of the date of the Subscribing Reinsurer's ’s Statement of Valuation, then each party shall appoint an actuary as party actuaries arbitrators for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to cannot agree upon on an acceptable independent actuary within 15 calendar days following of the date of their appointmentthe Subscribing Reinsurer’s Statement of Valuation, the Company shall supply the Subscribing Reinsurer with a list of at least five three proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 calendar days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "“independent actuary" ” shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In Notwithstanding paragraphs A, B and C above, in the event that the Subscribing Reinsurer no longer meets any of the criteria set forth conditions specified in subparagraph 1 or 2 in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination of this Contract and/or a Subscribing Reinsurer's percentage share in this Contract.

Special Commutation. A. The In the event a Subscribing Reinsurer meets one or more of the following conditions, the Company may require a commutation of that portion of any excess loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if . 1. The Subscribing Reinsurer’s A.M. Best’s rating has been assigned or downgraded below A- (including any remains, if the “Not Rated” rating) and/or Standard & Poor’s rating has been assigned or downgraded below BBB+ (including any “Not Rated” rating); or 2. The Subscribing Reinsurer is a Special Circumstance Reinsurerhas ceased assuming new or renewal property and casualty treaty reinsurance business. "“Outstanding claim or claims" ” shall include claims incurred but not reported, be defined as established by the Companyknown or unknown claims, including any billed yet unpaid claims. However, unless otherwise mutually agreed, this paragraph A shall not apply unless the outstanding claim or claims is for an amount not less than $5,000. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the excess loss. The Subscribing Reinsurer shall then pay the amount requested within 10 30 calendar days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 calendar days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 calendar days of receipt of the notification. Within 30 calendar days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the excess loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's ’s Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 calendar days of the date of the Subscribing Reinsurer's ’s Statement of Valuation, then each party shall appoint an actuary as party actuaries arbitrators for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to cannot agree upon on an acceptable independent actuary within 15 calendar days following of the date of their appointmentthe Subscribing Reinsurer’s Statement of Valuation, the Company shall supply the Subscribing Reinsurer with a list of at least five three proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 calendar days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "“independent actuary" ” shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In Notwithstanding paragraphs A, B and C above, in the event that the Subscribing Reinsurer no longer meets any of the criteria set forth conditions specified in subparagraph 1 or 2 in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the expiration or termination of this Contract and/or a Subscribing Reinsurer's percentage share in this Contract.

Special Commutation. A. The Company may require commutation of that portion of any loss unsettled liability hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus ceded unearned premium hereunderpremium, if any, in the event of any remainsone of the following circumstances occurring: 1. A Subscribing Reinsurer’s A.M. Best’s rating has been assigned or downgraded below A- (inclusive of “Not Rated” ratings) and/or Standard & Poor’s rating has been assigned or downgraded below BBB (inclusive of “Not Rated” ratings); or 2. A Subscribing Reinsurer has become insolvent or has been placed into liquidation or receivership (whether voluntary or involuntary), if or proceedings have been instituted against the Subscribing Reinsurer is for the appointment of a Special Circumstance Reinsurerreceiver, liquidator, rehabilitator, conservator, trustee in bankruptcy or other agent known by whatever name, to take possession of its assets or control of its operations; or 3. "A Subscribing Reinsurer has ceased assuming new or renewal property or casualty treaty reinsurance business. “Outstanding claim or claims" ” as used herein shall include claims incurred but not reported, as established by the Companymean known or unknown claims, including any billed yet unpaid claims. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the loss unsettled liability and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the lossunsettled liability. The Subscribing Reinsurer shall then pay the amount requested requested, plus any ceded unearned premium reserves, within 10 15 calendar days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 calendar days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 calendar days of receipt of the notification. Within 30 calendar days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the loss unsettled liability and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuationunsettled liability. D. In the event the Subscribing Reinsurer's ’s Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties.. 07\I6L1001 E. If the parties cannot agree on an acceptable independent actuary within 15 calendar days of the date of the Subscribing Reinsurer's ’s Statement of Valuation, then each party shall appoint an actuary as party actuaries arbitrators for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to cannot agree upon on an acceptable independent actuary within 15 calendar days following of the date of their appointmentthe Subscribing Reinsurer’s Statement of Valuation, the Company shall supply the Subscribing Reinsurer with a list of at least five 5 proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 calendar days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "“independent actuary" ” shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or Member of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In Notwithstanding paragraphs A, B and C above, in the event that the Subscribing Reinsurer no longer meets the criteria specifications set forth in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any ceded unearned premium reserves under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination of this Contract and/or a Subscribing Reinsurer's percentage share in this Contract.

Special Commutation. A. The Company may require commutation of that portion of any loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if any remains, if the Subscribing Reinsurer is a Special Circumstance Reinsurer. "Outstanding claim or claims" shall include claims incurred but not reported, as established by the Company, including any billed yet unpaid claims. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the loss. The Subscribing Reinsurer shall then pay the amount requested within 10 days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 days of receipt of the Company's Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 days of receipt of the notification. Within 30 days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the loss and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 days of the date of the Subscribing Reinsurer's Statement of Valuation, then each party shall appoint an actuary as party actuaries for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to agree upon an acceptable independent actuary within 15 days following the date of their appointment, the Company shall supply the Subscribing Reinsurer with a list of at least five proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "independent actuary" shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In the event that the Subscribing Reinsurer no longer meets the criteria set forth in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination expiration of this Contract and/or the termination of a Subscribing Reinsurer's percentage share in this Contract.

Special Commutation. A. The In the event a Subscribing Reinsurer meets one or more of the following conditions, the Company may require a commutation of that portion of any excess loss hereunder represented by any outstanding claim or claims, including any related loss adjustment expense, plus unearned premium hereunder, if : 1. The Subscribing Reinsurer’s A.M. Best’s rating has been assigned or downgraded below A- (including any remains, if the “Not Rated” rating) and/or Standard & Poor’s rating has been assigned or downgraded below BBB+ (including any “NR” rating); or 2. The Subscribing Reinsurer is a Special Circumstance Reinsurerhas ceased assuming new or renewal property or casualty treaty reinsurance business. "“Outstanding claim or claims" ” shall include claims incurred but not reported, be defined as established by the Companyknown or unknown claims, including any billed yet unpaid claims. However, unless otherwise mutually agreed, this paragraph A shall not apply unless the outstanding claim or claims is for an amount not less than $5,000. B. If the Company elects to require commutation as provided in paragraph A above, the Company shall submit a Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Company. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss and shall set forth or attach the information relied upon by the Company and the methodology employed to calculate the excess loss. The Subscribing Reinsurer shall then pay the amount requested within 10 30 calendar days of receipt of such Statement of Valuation, unless the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests such amount. C. If the Subscribing Reinsurer needs additional information from the Company to assess the Company's ’s Statement of Valuation or contests the amount requested, the Subscribing Reinsurer shall so notify the Company within 15 calendar days of receipt of the Company's ’s Statement of Valuation. The Company shall supply any reasonably requested information to the Subscribing Reinsurer within 15 calendar days of receipt of the notification. Within 30 calendar days of the date of the notification or of the receipt of the information, whichever is later, the Subscribing Reinsurer shall provide the Company with its Statement of Valuation of the outstanding claim or claims as of the last day of the month immediately preceding the month in which the Company elects to require commutation, as determined by the Subscribing Reinsurer. Such Statement of Valuation shall include the elements considered reasonable to establish the excess loss and shall set forth or attach the information relied upon by the Subscribing Reinsurer and the methodology employed to calculate the excess loss. The Subscribing Reinsurer shall pay the amount due the Company, if any, plus any ceded unearned premium reserves with its Statement of Valuation. D. In the event the Subscribing Reinsurer's ’s Statement of Valuation of the outstanding claim or claims is viewed as unacceptable to the Company, the Company may either abandon the commutation effort, or may seek to settle any difference by using an independent actuary agreed to by the parties. E. If the parties cannot agree on an acceptable independent actuary within 15 days of the date of the Subscribing Reinsurer's Statement of Valuation, then each party shall appoint an actuary as party actuaries for the limited and sole purpose of selecting an independent actuary. If the party actuaries fail to agree upon an acceptable independent actuary within 15 days following the date of their appointment, the Company shall supply the Subscribing Reinsurer with a list of at least five proposed independent actuaries, and the Subscribing Reinsurer shall select the independent actuary from that list. F. Upon selection of the independent actuary, both parties shall present their respective written submissions to the independent actuary. The independent actuary may, at his or her discretion, request additional information. The independent actuary shall issue his or her decision within 45 days after the written submissions have been filed and any additional information has been provided. Any amount due the Company (including any ceded unearned premium reserves) shall be paid by the Subscribing Reinsurer within 15 calendar days after such decision has been issued. G. The decision of the independent actuary shall be final and binding. The expense of the independent actuary shall be equally divided between the two parties. For the purposes of this Article, unless mutually agreed otherwise, an "independent actuary" shall be an actuary who satisfies each of the following criteria: 1. Is regularly engaged in the valuation of claims resulting from lines of business subject to this Contract; and 2. Is either a Fellow of the Casualty Actuarial Society or of the American Academy of Actuaries; and 3. Is disinterested and impartial regarding this commutation. H. In the event that the Subscribing Reinsurer no longer meets the criteria set forth in paragraph A above, this commutation may continue on a mutually agreed basis. I. Payment by the Subscribing Reinsurer of the amount requested in accordance with paragraph B, C or F above, shall release the Subscribing Reinsurer from all further liability for outstanding claim or claims, known or unknown, and any unearned premium under this Contract and shall release the Company from all further liability for payments of salvage or subrogation amounts, known or unknown, to the Subscribing Reinsurer under this Contract. J. In the event of any conflict between this Article and any other article of this Contract, the terms of this Article shall control. K. This Article shall survive the termination of this Contract and/or a Subscribing Reinsurer's percentage share in this Contract.