[LOGO]
HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
(hereinafter referred to as "Agreement")
between
▇▇▇▇▇ INSURANCE COMPANY
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as the "Company")
and
The Subscribing Reinsurers executing
the Interests and Liabilities Agreements attached to this Agreement
(hereinafter collectively referred to as the "Reinsurers")
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In consideration of the promises set forth in this Agreement, the parties agree
as follows:
ARTICLE I - SCOPE OF AGREEMENT
As a condition precedent to the Reinsurers' obligations under this
Agreement, the Company shall cede to the Reinsurers the business described in
this Agreement, and the Reinsurers shall accept such business as reinsurance
from the Company.
This Agreement is comprised of General Articles I through XIV and the
Exhibit(s) listed below and each Exhibit which may be made a part of this
Agreement. The terms of the General Articles and of the Exhibit(s) shall
determine the rights and obligations of the parties. The terms of the General
Articles shall apply to each Exhibit unless specifically amended therein. In
the event of termination of all the Exhibits made a part of this Agreement,
the General Articles shall automatically terminate when the liability of the
Reinsurers under said Exhibits ceases.
EXHIBIT A - THIRD EXCESS OF LOSS REINSURANCE
of
WORKERS' COMPENSATION AND EMPLOYERS'
LIABILITY BUSINESS
EXHIBIT B - FOURTH EXCESS OF LOSS REINSURANCE
of
WORKERS' COMPENSATION BUSINESS
EXHIBIT C - FIFTH EXCESS OF LOSS REINSURANCE
of
WORKERS' COMPENSATION BUSINESS
ARTICLE II - PARTIES TO THE AGREEMENT
This Agreement is solely between the Company and the Reinsurers. For the
purposes of this Agreement, when more than one Company is named as a party to
this Agreement, the first Company named shall be the agent of the other
companies as to all matters pertaining to this Agreement. Performance of the
obligations of each party under this Agreement shall be rendered solely to
the other party. However, if the Company becomes insolvent, the liability of
the Reinsurers shall be modified to the extent set forth in the article
entitled INSOLVENCY OF THE COMPANY. In no instance shall any insured of the
Company or any claimant against an insured of the Company have any rights
under this Agreement.
ARTICLE III - GENERAL CONDITIONS, DEFINITIONS AND
INTERPRETATIONS
(a) BUSINESS
The term business shall have the meaning set forth in the
appropriate Exhibit. The term policy(ies) shall mean the
contracts of the Company affording insurance with respect to
such business.
(b) COMPANY
When more than one company is named as a party to this
Agreement, the first such company named shall be the agent of
the other companies with respect to all matters pertaining to
this Agreement.
(c) COMPANY RETENTION
The Company shall retain for its own account the entire amount
set forth as the Company Retention; however, this requirement
shall be satisfied if such amount is retained by the Company or
its affiliated companies under common management or common
ownership or both.
(d) ERRORS AND OMISSIONS
The Reinsurers shall not be relieved of liability by reason of
an error or accidental omission by the Company in reporting any
claim or loss or any business reinsured under this Agreement,
provided such error or omission is rectified promptly after
discovery.
The Reinsurers shall be obligated only for the return of the
premium paid to the Reinsurers with respect to business
reported but not reinsured under this Agreement.
However, the provisions of this paragraph (d) shall not apply
with respect to a loss reported to the Reinsurers subsequent to
the period stipulated in paragraph (b) of the sections entitled
REPORTS AND REMITTANCES in Exhibits B and C to this Agreement.
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(e) SPECIAL ACCEPTANCES
Business which is beyond the terms, conditions or limitations
of this Agreement may be submitted to the Reinsurers for
special acceptance hereunder and such business, if accepted by
the Reinsurers, shall be subject to all of the terms,
conditions and limitations of this Agreement except as modified
by the special acceptance.
ARTICLE IV - CLAIMS AND LOSSES, ADJUSTMENT EXPENSE AND
SALVAGE
(a) CLAIMS AND LOSSES
All payments of claims or losses by the Company within the
limits of liability or amounts of insurance of the policy(ies)
of the Company and within the limits of liability or amounts of
reinsurance set forth in the applicable Exhibit shall be
binding on the Reinsurers, subject to all the terms, conditions
and limitations of this Agreement. The Reinsurers shall
reimburse the Company for the Reinsurers' portion of each
payment in settlement of claims or losses made by the Company
and the Reinsurers' portion of the Company's adjustment expense
payments, if any, apportioned between the parties as set forth
in the Exhibits, in connection with such claim or loss
payments; however, in the instance of the insolvency of the
Company, the liability of the Reinsurers shall be modified to
the extent set forth in the article entitled INSOLVENCY OF THE
COMPANY.
The Company shall investigate and settle or defend all claims
and losses. When requested by the Reinsurers, the Company shall
permit the Reinsurers, at the expense of the Reinsurers, to be
associated with the Company in the defense or control of any
claim, loss or legal proceeding which involves or is likely to
involve the Reinsurers.
(b) ADJUSTMENT EXPENSE
Adjustment expense shall mean all expenditures made by the
Company and allocated to an individual claim or loss, other
than payments to any salaried employee of the Company, in
connection with the disposition of claims, losses or legal
proceedings including investigation, negotiation and legal
expenses, court costs, and accrued interest, other than accrued
interest which is a part of a judgment.
(c) SALVAGE
The Company shall pay to or credit the Reinsurers with the
Reinsurers' portion of any salvage recovered.
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With respect to reinsurance under this Agreement on a share
basis, salvage shall be apportioned between the parties in the
same ratio as the amounts of their respective liabilities for
the claim or loss. With respect to reinsurance under this
Agreement on an excess basis, salvage shall be applied between
the parties in the order inverse to that in which their
respective liabilities attached.
Salvage shall mean any recovery made by the Company in
connection with a claim or loss, less all expenses paid by the
Company, other than payments to any salaried employee of the
Company, in making such recovery.
ARTICLE V - REPORTS AND REMITTANCES
In addition to the reports and remittances required by the applicable
Exhibits, the Company shall furnish such other information as may be required
by the Reinsurers for the completion of the Reinsurers' quarterly and annual
statements and internal records.
All reports shall be rendered on forms mutually acceptable to the Company
and the Reinsurers.
ARTICLE VI - RESERVES AND TAXES
The Reinsurers shall maintain such reserves as may be required with
respect to the Reinsurers' portion of unearned premium, claims, losses and
adjustment expense.
The Company shall be liable for all taxes on premiums ceded to the
Reinsurers under this Agreement. If the Reinsurers are obligated to pay any
taxes on such premiums, the Company shall reimburse the Reinsurers; however,
the Company shall not be required to pay taxes twice on the same premiums.
ARTICLE VII - OFFSET
The Company or the Reinsurers may offset any balance(s), whether on
account of premiums, commission, claims or losses, adjustment expense,
salvage, or any other amount(s) due from one party to the other under this
Agreement.
ARTICLE VIII - INSPECTION OF RECORDS
The Company shall allow the Reinsurers to inspect, at all reasonable
times, all records of the Company with respect to the business reinsured
under this Agreement, or with respect to claims, losses or legal proceedings
which involve or are likely to involve the Reinsurers.
ARTICLE IX - ARBITRATION
Should any difference of opinion arise between any of the Reinsurers and
the Company which cannot be resolved in the normal course of business with
respect to the interpretation of this Agreement or the performance of the
respective obligations of the
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parties under this Agreement, the difference shall be submitted to arbitration.
If more than one Reinsurer is involved in the same dispute, all such Reinsurers
shall constitute and act as one party for purposes of this Article and
communications shall be made by the Company to each of the Reinsurers
constituting the one party; provided, however, that nothing herein shall impair
the rights of such Reinsurers to assert several, rather than joint, defenses of
claims, nor be construed as changing the liability of the Reinsurers under the
terms of this Agreement from several to joint.
One arbitrator shall be chosen by the Reinsurer(s), one by the Company and
an umpire by the two arbitrators before they enter upon arbitration. If the
arbitrators have not chosen an umpire at the end of 10 days following the
last date of the selection of the two arbitrators, each of the arbitrators
shall name three of whom the other declines two and the decision shall be
made of the remaining two by drawing lots.
The arbitrators and umpire shall be officials of insurance or reinsurance
companies authorized to transact business in one or more states of the United
States of America and writing the kind of business about which the difference
has arisen. The arbitrators and umpire are relieved from all judicial
formalities and may abstain from following the strict rules of law and they
shall make their award with a view to effecting the general purpose of this
Agreement rather than in accordance with the literal interpretation of the
language, and the decision of the majority shall be final and binding upon
the parties under this Agreement.
If either party fails to choose an arbitrator within one month after
receiving the written request of the other party to do so, the latter shall
choose both arbitrators, who shall choose the umpire as provided.
Each party shall submit its case to the arbitrators and umpire within one
month after receipt of advices of the selection of the umpire unless the
period is extended by the arbitrators.
The costs of arbitration, including the fees of the arbitrators and
umpire, shall be borne equally unless the arbitrators and umpire shall decide
otherwise. The arbitration shall be held at the times and place agreed upon
by the arbitrators and umpire. The laws of the State of California shall
govern the arbitration.
ARTICLE X - INSOLVENCY OF THE COMPANY
In the event of the insolvency of the Company, the reinsurance proceeds
will be paid to the Company or the liquidator immediately upon demand, with
reasonable provision for verification, on the basis of the amount of the
claim allowed in the insolvency proceeding without diminution by reason of
the inability of the Company to pay all or part of the claim.
The Reinsurers shall be given written notice of the pendency of each claim
against the Company on the policy(ies) reinsured hereunder within a
reasonable time after such claim is filed in the insolvency proceedings. The
Reinsurers shall have the right to investigate each such claim and to
interpose, at their own expense, in the proceeding where such claim is to be
adjudicated, any defenses which they may deem available to the Company or its
liquidator. The expense thus incurred by the Reinsurers shall be chargeable,
subject to court approval, against the insolvent Company as part of the
expense f liquidation to the extent of a proportionate share of the benefit
which may accrue to the Company solely as a result of the defense undertaken
by the Reinsurers.
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ARTICLE XI - LOSS RESERVES (U.S. DOLLAR REINSURANCE LETTERS OF CREDIT)
(This Article applies only to those Reinsurers who cannot qualify for
credit in any State or any other governmental body having jurisdiction
over the Company's loss reserves.)
As regards all business coming within the scope of this Agreement, the
Company agrees that when it shall file with the Insurance Department or set
up on its books reserves for losses covered hereunder which it shall be
required to set up by law, it will forward to the Reinsurers a statement
showing the proportion of such loss reserves which is applicable to them.
These reserves will consist solely of known outstanding losses that have been
reported to the Reinsurers and allocated adjustment expense relating thereto.
Each such Reinsurer hereby agrees it will apply for and secure delivery to
the Company of a clean, unconditional, irrevocable Letter of Credit issued by
a member bank of the Federal Reserve System acceptable to the Company, in an
amount equal to such Reinsurer's proportion of said loss reserves or, at the
option of such Reinsurer, provide a cash advance in an amount equal to such
Reinsurer's proportion of said loss reserves. No reserves established in
accordance with the foregoing shall include or be applied towards security
for losses incurred but not reported.
The Company undertakes to use and apply any amounts which it may draw upon
such Irrevocable Letter of Credit pursuant to the terms of this Agreement, if
any, under which the Letter of Credit is held, and for the following purposes
only:
(a) To pay such Reinsurer's share or to reimburse the Company for such
Reinsurer's share of any ultimate net loss reinsured by this Agreement.
(b) To make refund of any sum which is in excess of the actual amount
required to pay such Reinsurer's share of any ultimate net loss
reinsured by this Agreement.
The designated bank shall have no responsibility whatsoever in connection
with the propriety of withdrawals made by the Company or the disposition of
funds withdrawn, except to see that withdrawals are made only upon the order
of properly authorized representatives of the Company.
ARTICLE XII - SERVICE OF SUIT
(This Article applies only to those Reinsurers who are domiciled outside the
United States of America and also to Reinsurers unauthorized in the State of
New York.)
In the event of the failure of the Reinsurers to whom this Article
applies, or any one of them, to pay any amount claimed to be due hereunder,
such Reinsurers, at the request of the Company, will submit to the
jurisdiction of any court of competent jurisdiction within the United States,
and will comply with all requirements necessary to give such court
jurisdiction, and all matters arising hereunder shall be determined in
accordance with the law and practice of such court.
Service of process in such suit may be made upon Messrs. Mendes and Mount,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, and in any suit instituted
against any
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one of them upon this Agreement, the Reinsurers will abide by the final decision
of such court or any appellate court in the event of an appeal.
The above named are authorized and directed to accept service of process
on behalf of the Reinsurers in any such suit and/or upon the request of the
Company to give a written undertaking to the Company that they will enter a
general appearance on behalf of Reinsurers or any one of them in the event
such a suit shall be instituted.
Further, pursuant to any statute of any state, territory, or district of
the United States which makes provisions therefor, the Reinsurers to whom
this Article applies hereby designate the Superintendent, Commissioner or
Director of Insurance or other officer specified for that purpose in the
statute, or his successor or successors in office, as their true and lawful
attorney upon whom may be served any lawful process in any action, suit, or
proceeding instituted by or on behalf of the Company or any beneficiary
hereunder arising out of this Agreement, and hereby designate the above named
Mendes and Mount as the firm to whom the said officer is authorized to mail
such process or a true copy thereof.
ARTICLE XIII - FEDERAL EXCISE TAX
(This Article applies only to those Reinsurers domiciled outside the United
States of America, excepting Reinsurers exempt from the Federal Excise Tax.)
The Reinsurers have agreed to allow for the purpose of paying Federal
Excise Tax 1% of the premium payable hereon to the extent such premium is
subject to Federal Excise Tax.
In the event of any return of premium becoming due hereon the Reinsurers
will deduct 1% from the amount of the return and the Company or its Agent
should take steps to recover the tax from the United States Government.
ARTICLE XIV - INTERMEDIARY
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Inc. is hereby recognized as the Intermediary negotiating
this Agreement for all business hereunder. All communications (including but
not limited to notices, statements, premiums, return premiums, commissions,
taxes, losses, loss adjustment expense, salvages, and loss settlements)
relating thereto shall be transmitted to the Company or the Reinsurers
through ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Inc., Financial Centre, ▇.▇. ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇. Payments by the Company to the Intermediary shall be
deemed to constitute payment to the Reinsurers. Payments by the Reinsurers to
the Intermediary shall be deemed only to constitute payment to the Company to
the extent that such payments are actually received by the Company.
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EXHIBIT A
Attached to and made a part of
HCI Agreement No. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
THIRD EXCESS OF LOSS REINSURANCE
of
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY BUSINESS
SECTION 1 - LIABILITY OF THE REINSURERS
The Reinsurers shall pay to the Company with respect to each accident
under Workers' Compensation and Employers' Liability business of the Company
the amount of net loss sustained by the Company in excess of the sum of the
Company Retention and Underlying Reinsurance, but not exceeding the Limit of
Liability of the Reinsurers as set forth in the Schedule of Reinsurance, plus
a proportionate share of adjustment expense.
SCHEDULE OF REINSURANCE
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Underlying Limit of Liability
Company Retention Reinsurance of the Reinsurers
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Each Accident Each Accident Each Accident
$200,000 $5,000,000 $5,000,000
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As respects workers' compensation business, the Reinsurers shall not be
liable for any portion of the net loss arising out of any one accident unless:
(a) Two or more insured persons of the Company are involved in the
accident resulting in such net loss; and
(b) The amount of net loss with respect to at least two insured persons
of the Company involved in such accident exceeds $25,000 each.
This condition does not apply to employers' liability business.
SECTION 2 - DEFINITIONS AND INTERPRETATIONS
(a) WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY BUSINESS
This term shall mean the insurance afforded by Parts One, Two, and
Three of a standard provisions Workers' Compensation and Employers'
Liability Policy and any endorsements attached thereto.
(b) ACCIDENT
This term shall mean each and every accident or occurrence or series
of accidents or occurrences arising out of one event, whether
involving one or several of the Company's policies and regardless of
the number of employees or employers involved.
(c) NET LOSS
This term shall mean all payments by the Company in settlement of
claims or losses, payment of compensation or other benefits, or
satisfaction of judgments or awards, after deduction of salvage, and
shall exclude adjustment expense and payments or liability in excess
of the Company's policy limit(s); however in the instance of the
insolvency of the Company, this definition shall be modified to the
extent set forth in the article entitled INSOLVENCY OF THE COMPANY.
SECTION 3 - EXCLUSIONS
This Exhibit shall not apply to:
(a) Business accepted by the Company as reinsurance from other insurers;
(b) Insurance written by the aviation underwriting unit, howsoever styled,
of the Company or written by the Company as a member of an aviation
insurance group or pool or association;
(c) Any extra or non-contractual damages or legal fees and expenses
attendant to the defense thereof, including but not limited to
compensatory, exemplary and punitive damages or fines or statutory
penalties which are awarded against the Company as a result of an act,
omission, or course of conduct committed by or on behalf of the
Company;
(d) Insurance with respect to operations involving:
(1) Aircraft flight and ground operations;
(2) Amusement parks or devices, exhibitions (including fireworks),
carnivals, circuses;
(3) Caisson or ▇▇▇▇▇▇ dam work, dam, dike, lock or revetment
construction;
(4) Chemical manufacturing;
(5) Manufacturing, packing, handling or shipping of explosives,
explosive substances intended for use as an explosive,
ammunitions, fuses, arms or fireworks;
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(6) Gas (including liquefied petroleum gas) companies, dealers,
distributors or construction;
(7) Maritime or federal employments, or steamship lines or agencies
or stevedoring;
(8) Mining or quarries;
(9) Oil or gas lease operators or contractors; oil or gas ▇▇▇▇▇ work;
oil or gas pipeline construction or operations; oil rig ▇▇▇▇▇▇▇
work;
(10) Railroad operation or construction;
(11) Sewer, subway or water main construction, or shaft sinking or
tunneling;
(12) Wrecking;
(13) Bodily injury (including occupational disease) arising from the
manufacture, removal, installation, storage, mining, handling or
transportation of asbestos if the insured's operations, at the
time of policy issuance, present known and/or generally
recognizable asbestos exposures; however, this exclusion shall
not apply to the removal, installation, storage, handling or
transportation of asbestos if such removal, installation,
storage, handling or transportation is incidental to the
insured's overall operations.
The term "incidental", as used in this exclusion, is intended to
recognize the fact that certain insureds (such as, but not
limited to, plumbing, carpentry, etc. contractors) will
infrequently, but regularly, encounter asbestos within the scope
of their operations - even though their operations, as such, do
not involve the manufacture, removal, installation, storage,
mining, handling, or transportation of asbestos. This exclusion
does not apply to such "incidental" operations.
(e) Occupational disease losses defined as follows:
"Occupational disease" means any abnormal condition that fulfills all
of the following conditions:
(1) It is not traceable to a definite compensable accident occurring
during the employee's present or past employment;
(2) It has been caused by exposure to a disease-producing causative
agent present in the workers' occupational environment; and
(3) It has resulted in a disability or death;
(f) Cumulative injury losses defined as follows:
"Cumulative injury" means any injury that fulfills all of the following
conditions:
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(1) It is not traceable to a definite compensable accident occuring
during the employee's present of present employment;
(2) It has occurred from, and has bees aggravated by, a repetitive
employment-related activity;
(3) It has resulted in disability or death;
If the Company provides insurance for an insured with respect to any
operations listed in one or more of the exclusions under (d), except
exclusion (d)(5), and such operations constitute only a minor and incidental
part of the total operations of the insured such exclusion(s) shall not apply.
If the Company is bound, without the knowledge of and contrary to the
instructions of the Company's supervisory underwriting personnel, on any
insurance of the Company falling within the scope of one or more of the
exclusions set forth in this section, these exclusions, except (a) and (c)
shall be suspended with respect to such business until 30 days after an
underwriting supervisor of the Company acquires knowledge of such business.
SECTION 4 - REINSURANCE PREMIUM
The Company shall pay to the Reinsurance a net, i.e., not subject to
commission reinsurance rate of 0.71% of the net premiums earned by the
Company on the business reinsured hereunder, subject to an annual minimum
deposit reinsurance premium of $363,000.
SECTION 5 - REPORTS AND REMITTANCES
(a) REINSURANCE PREMIUM
On or before the first day of each calendar quarter commencing on
July 1, 1995, the Company shall pay to the Reinsurers one quarter of
the annual minimum and deposit reinsurance premium stipulated in the
section entitled REINSURANCE PREMIUM.
As soon as possible after June 30, 1996, and each subsequent June
30th, the Company shall furnish to the Reinsurers a statement of the
premium earned by the Company on the business reinsured hereunder
during the annaual period ending on such June 30th. The Company shall
calculate the reinsurance premium thereon, and remit to the Reinsurers
the amount of reinsurance premium, if any, in excess of the annual
minimum and deposit reinsurance premium.
(b) CLAIMS AND LOSSES
The Company shall report promptly to the Reinsurers each claim or
loss which, in the Company's opinion, may involve the reinsurance
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afforded by this Exhibit, and shall also provide written notice of any claim or
circumstance involving the following injuries:
(1) Cord injury - paraplegia, quadriplegia;
(2) Amputations - requiring a prosthesis;
(3) Brain damage affecting mentality or central nervous system such
as permanent disorientation, behavior disorder, personality
change, seizures, motor deficit, inability to speak (aphasia),
hemiplegia or unconsciousness (comatose);
(4) ▇▇▇▇▇-involving over 10% of body with third degree or 30% of body
with second degree; (5) Fatalities; (6) Permanent Total
disability.
The Company shall advise the Reinsurers of the estimated amount
of net loss and adjustment expense in connection with each such
claim or loss and of any subsequent changes in such estimates.
Upon receipt of a definitive statement of net loss and adjustment
expense from the Company, the Reinsurers shall pay promptly to
the Company the Reinsurers' portion of net loss and Reinsurers'
portion of adjustment expense, if any. Any subsequent changes
shall be reported by the Company to the Reinsurers and the amount
due either party shall be remitted promptly.
SECTION 6 - COMMENCEMENT AND TERMINATION
This Exhibit applies to new and renewal policies of the Company becoming
effective at and after 12:01 A.M., July 1, 1995, and to policies in force at
12:01 A.M., July 1, 1995, for claims and losses resulting from accidents
occurring at and after the aforesaid time and date.
This Exhibit may be terminated on any June 30th by either party sending to
the other, by registered mail to its principal office, not less than 90 days
prior written notice. The Reinsurers shall not be liable for any claims or
losses resulting from accidents occurring after the effective time and date
of termination.
Notwithstanding the foregoing, if the Company is merged with or purchased
by another Company, or if controlling interest is sold or changed so as to
produce a loss in control over conduct of the business by the current owners,
the Company shall immediately notify the Reinsurers by registered mail to its
principal office giving details (to the extent of its knowledge thereof) of
the particulars of such merger, change, sale or purchase. Within 35 days
after the date of mailing of such notice by the Company, the Reinsurers may
terminate this Exhibit in its entirety by sending to the Company, by
registered mail to its principal office, notice stating the time and date
when not less than 5 days after the date of mailing of such notice,
termination shall be effective.
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If the Company fails to notify the Reinsurers of such merger, purchase,
change or sale, the Reinsurers, within 35 days after the Reinsurers have
acquired knowledge of the merger, purchase, change or sale, may terminate
this Exhibit in its entirety by sending to the Company, by registered mail to
its principal office, notice stating the time and date when, not less than 5
days after the mailing of such notice, termination shall be effective.
In any instance that the Reinsurers terminate this Exhibit in accordance
with the two previous paragraphs, the Reinsurers shall not be liable for
claims or losses resulting from accidents occurring after the effective time
and date of termination.
SECTION 7 - REINSTATEMENT
The Limit of Liability of the Reinsurers under this Exhibit with respect
to each accident shall be reduced by an amount equal to the amount of
liability paid by the Reinsurers, but that part of the liability of the
Reinsurers that is so reduced shall be automatically reinstated, subject to
the maximum payment of $10,000,000 of net loss with respect to all accidents
occurring during each annual period from July 1st through June 30th that this
Exhibit is in effect.
In consideration of this automatic reinstatement, the Company shall pay to
the Reinsurers for each amount reinstated an additional reinsurance premium
which shall be the product of the annual reinsurance premium set forth in the
section entitled REINSURANCE PREMIUM for the annual period during which the
accident occurs and the amount so reinstated divided by $5,000,000.
The reinsurance premium so developed for each amount reinstated shall be
in addition to the reinsurance premium set forth in the section entitled
REINSURANCE PREMIUM, and shall be paid by the Company immediately following
loss payment by the Reinsurers.
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TERMINATION ENDORSEMENT
Attached to and made a part of HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILlTY EXCESS OF LOSS REINSURANCE
AGREEMENT
THIRD EXCESS OF LOSS REINSURANCE
of
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY BUSINESS
between
▇▇▇▇▇ INSURANCE COMPANY
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(herein referred to as the "Company")
and
The Subscribing Reinsurer(s) executing the
Interests and Liabilities Agreements attached to this Agreement
(herein referred to as the "Reinsurers")
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IT IS MUTUALLY AGREED that, effective 12:01 A.M., July 1, 1996, this
Exhibit is terminated. The Reinsurer shall not be liable for claims and
losses resulting from accidents occurring at and after the aforesaid time and
date.
EXHIBIT B
Attached to and made a part of
HCI Agreement No. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
FOURTH EXCESS OF LOSS REINSURANCE OF
WORKERS' COMPENSATION BUSINESS
SECTION 1 - LIABILITY OF THE REINSURERS
The Reinsurers shall pay to the Company with respect to accident
occurrence under Workers' Compensation business of the Company, the amount of
net loss sustained by the Company in excess of the sum of the Company
Retention and Underlying Reinsurance, but not exceeding the Limit of
Liability of the Reinsurers as set forth in the Schedule of Reinsurance, plus
a proportionate share of adjustment expense.
SCHEDULE OF REINSURANCE
--------------------------------------------------------------------------------
Underlying Limit of Liability
Company Retention Reinsurance of the Reinsurers
--------------------------------------------------------------------------------
Each Accident Each Accident Each Accident
$200,000 $10,000,000 $10,000,000
--------------------------------------------------------------------------------
For the purpose of determining the amount of net loss sustained by the
Company, it is deemed that the amount of net loss any one employee shall not
exceed $2,000,000.
SECTION 2 - DEFINITIONS AND INTERPRETATIONS
(a) WORKERS' COMPENSATION BUSINESS
This term shall mean the insurance afforded by Parts One, Two, and
Three of a standard provisions Workers' Compensation and Employers'
Liability Policy and any endorsements attached thereto.
(b) ACCIDENT
This term shall mean each and every accident or occurrence or series
of accidents or occurrences arising out of one event, whether
involving one or several of the Company's policies and regardless of
the number of employees or employers involved.
(c) NET LOSS
This term shall mean all payments by the Company in settlement of
claims of losses, payment of compensation or other benefits, or
satisfaction of judgements or awards, after deductions of salvage, and
shall exclude adjustment expenses and payments or liability in excess
of the Company's policy limit(s); however in the instance of the
insolvency of the Company, this definition shall be modified to the
extent set forth in the article entitled INSOLVENCY OF THE COMPAY.
SECTION 3 - EXCLUSIONS
This Exhibit shall not apply to:
(a) Business accepted by the Company as reinsurance from other insurers;
(b) Insurance written by the aviation underwriting unit, howsoever
styled, of the Company or written by the Company as a member of an
aviation insurance group or pool or association;
(c) Any extra or non-contractual damages or legal fees and expenses
attendant to the defense thereof, including but not limited to
compensatory, exemplary and punitive damages or fines or statutory
penalties which are awarded against the Company as a result of an act,
ommission, or course of conduct committed by or on behalf of the
Company;
(d) Insurance with respect to operations involving:
(1) Aircraft flight and ground operations;
(2) Amusement parks or devices, exhibitions (including fireworks),
carnivals, circuses;
(3) Caisson or ▇▇▇▇▇▇ dam work, dam, dike, lock or revement
constuction;
(4) Chemical manufacturing;
(5) Manufacturing, packing, handling or shipping of explosives,
explosive substances intended for use as an explosive,
ammunitions, fuses, arms or fireworks;
(6) Gas (including liquified petroleum gas) companies, dealers,
distributors or construction;
(7) Maritime or federal employments, or steamship lines or agencies
or setvedoring;
B-2
(8) Mining or quarries;
(9) Oil or gas lease operators or contractors; oil or gas ▇▇▇▇▇ work;
oil or gas pipeline construction or operations; oil rig ▇▇▇▇▇▇▇
work;
(10) Railroad operation or construction;
(11) Sewer, subway or water main construction, or shaft sinking or
tunneling;
(12) Wrecking;
(13) Bodily injury (including occupational disease) arising from the
manufacture, removal, installation, storage, mining, handling or
transportation of asbestos if the insured's operations, at the
time of policy issuance, present known and/or generally
recognizable asbestos exposures; however, this exclusion shall
not apply to the removal, installation, storage, handling or
transportation of asbestos if such removal, installation,
storage, handling or transportation is incidental to the
insured's overall operations.
The term "incidental", as used in this exclusion, is intended to
recognize the fact that certain insureds (such as, but not
limited to, plumbing, carpentry, etc. contractors) will
infrequently, but regularly, encounter asbestos within the scope
of their operations - even though their operations, as such, do
not involve the manufacture, removal, installation, storage,
mining, handling, or transportation of asbestos. This exclusion
does not apply to such "incidental" operations;
(e) Employers' Liability;
(f) Occupational disease losses defined as follows:
"Occupational disease" means any abnormal condition that fulfills
all of the following conditions:
(1) It is not traceable to a definite compensable accident occurring
during the employee's present or past employment;
(2) It has been caused by exposure to a disease-producing causative
agent present in the workers' occupational environment; and
(3) It has resulted in a disability or death;
(g) Cumulative injury losses defined as follows:
"Cumulative injury" means any injury that fulfills all of the following
conditions:
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(1) It is not traceable to a definite compensable accident occurring
during the employee's present or present employment;
(2) It has occurred from, and has been aggravated by, a repetitive
employment-related activity;
(3) It has resulted in a disability or death."
(h) ▇▇▇▇▇ Act;
(i) United States Longshoremen and Harborworkers Act;
(j) War, civil war,
(k) Insolvency funds;
(1) Excess and Surplus Lines;
(m) Professional sports teams;
(n) Nuclear incidents;
(o) Commercial airline personnel; flight and non-flight personnel.
If the Company provides insurance for an insured with respect to any
operations listed in one or more of the exclusions under (d), except
exclusion (d)(5), and such operations constitute only a minor and incidental
part of the total operations of the insured, such exclusion(s) shall not
apply.
SECTION 4 - REINSURANCE PREMIUM
The Company shall pay to the Reinsurers a net, i.e., not subject to
commission, reinsurance rate of 0.13% of the net premiums earned by the
Company on the business reinsured hereunder, subject to an annual minimum and
deposit reinsurance premium of $66,650.
SECTION 5 - REPORTS AND REMITTANCES
(a) REINSURANCE PREMIUM
On or before the first day of each calendar quarter commencing on July
1, 1995, the Company shall pay to the Reinsurers one quarter of the
annual minimum and deposit reinsurance premium stipulated in the
section entitled REINSURANCE PREMIUM.
As soon as possible after June 30, 1996, and each subsequent June
30th, the Company shall furnish to the Reinsurers a statement of the
premium earned by the Company on the business reinsured hereunder
during the annual period ending on such June 30th. The Company shall
calculate the reinsurance premium thereon and remit
B-4
to the Reinsurers the amount of reinsurance premium, if any, in excess
of the annual minimum and deposit reinsurance premium.
(b) NOTICE OF CLAIMS
The Company will give written notice of loss under this Exhibit to the
Reinsurers not later than 60 months after the end of the annual period
from July 1st through June 30th during which the accident occurs to be
considered for claim payment. The Company shall also promptly notify
the Reinsurers in writing and thereafter promptly and fully inform the
Reinsurers in writing, of all negotiations entered into by the Company
concerning all claims which may involve the reinsurance provided under
this Exhibit, and shall provide the Reinsurers prior written notice on
any other action. relating to such claims including any payment of
such claims by the Company. The Company shall give prompt written
notification to the Reinsurers on any claim for which the Company has
created a loss reserve equal to or greater than 50 percent of the
Company's retention of this reinsurance. In addition, the Company
shall notify the Reinsurers in writing of any material changes in its
loss reserves. The Company further agrees to forward to the Reinsurers
copies of such pleadings and reports of investigations as are
pertinent to the claim and/or as may be requested by the Reinsurers.
Upon receipt of a definitive statement of net loss and adjustment
expense from the Company, the Reinsurers shall pay promptly to the
Company the Reinsurers' portion of net loss and the Reinsurers'
portion of adjustment expense, if any. Any subsequent changes shall be
reported by the Company to the Reinsurers and the amount due either
party shall be remitted promptly.
(c) COMMUTATION OF LOSSES
60 months after the end of each annual period from July 1st through
June 30th, the Company shall advise the Reinsurers of any outstanding
claims or accidents during that annual period which have not been
finally settled and which may cause a claim under this Exhibit.
The Reinsurers may then, or at any time thereafter, request that their
liability with respect to one or more of such unsettled claims be
commuted. Upon such request, the Reinsurers and the Company shall
review such claim and shall attempt to reach a settlement by mutual
agreement. If the Reinsurers and the Company cannot reach a settlement
by mutual agreement, then the Reinsurers and the Company shall
mutually appoint an independent actuary (F.S.A./F.C.A.S. or
A.S.A./A.C.A.S.) who shall investigate, determine and capitalize the
present value of any such unsettled claims. In the event the
Reinsurers and the Company cannot reach an agreement on a independent
actuary, each party shall appoint an actuary. The two chosen actuaries
shall then select a third actuary. If either party refuses or neglects
to appoint an actuary within 30 days after receipt of the written
request for commutation, the requesting party may appoint a second
actuary. If the two actuaries
B-5
fail to agree on the selection of a third actuary within 30 days of
their appointment, each of them shall name three individuals, of whom
the other shall decline two, and the decision shall be made by drawing
lots. All actuaries selected by drawing lots shall be disinterested in
the outcome of the commutation. The decision of the majority shall be
final and binding upon the parties.
Any payment by the Reinsurers under this paragraph (c) shall
constitute a complete release of the Reinsurers for their liability as
respects any such claim. The cost of any independent actuary shall be
shared on an equal basis by the Reinsurers and the Company.
SECTION 6 - COMMENCEMENT AND TERMINATION
This Exhibit applies to new and renewal policies of the Company becoming
effective at and after 12:01 A.M., July 1, 1995 and to policies in force at
12:01 A.M., July 1, 1995, for claims and losses resulting from accidents
occurring at and after the aforesaid time and date.
This Exhibit may be terminated on any June 30th by either party sending to
the other, by registered mail to its principal office, not less than 90 days
prior written notice. The Reinsurers shall not be liable for any claims or
losses resulting from accidents occurring after the effective time and date
of termination.
Notwithstanding the foregoing, if the Company is merged with or purchased
by another Company, or if controlling interest is sold or changed so as to
produce a loss in control over conduct of the business by the current owners,
the Company shall immediately notify the Reinsurers by registered mail to its
principal office giving details (to the extent of its knowledge thereof) of
the particulars of such merger, change, sale or purchase. Within 35 days
after the date of mailing of such notice by the Company, the Reinsurers may
terminate this Exhibit in its entirety by sending to the Company, by
registered mail to its principal office, notice stating the time and date
when not less than 5 days after the date of mailing of such notice,
termination shall be effective.
If the Company fails to notify the Reinsurers of such merger, purchase,
change or sale, the Reinsurers, within 35 days after the Reinsurers have
acquired knowledge of the merger, purchase, change or sale, may terminate
this Exhibit in its entirety by sending to the Company, by registered mail to
its principal office, notice stating the time and date when, not less than 5
days after the mailing of such notice, termination shall be effective.
In any instance that the Reinsurers terminate this Exhibit in accordance
with the two previous paragraphs, the Reinsurers shall not be liable for
claims or losses resulting from accidents occurring after the effective time
and date of termination.
SECTION 7 - REINSTATEMENT
The Limit of Liability of the Reinsurers under this Exhibit with respect
to each accident shall be reduced by an amount equal to the amount of
liability paid by the Reinsurers, but that part of the liability of the
Reinsurers that is so reduced shall be automatically reinstated, subject to
the maximum payment of $20,000,000 of net loss with respect to all accidents
occurring during each annual period from July 1st through June 30th that this
Exhibit is in effect.
B-6
In consideration of this automatic reinstatement, the Company shall pay to
the Reinsurers for each amount reinstated an additional reinsurance premium
which shall be the product of the annual reinsurance premium set forth in the
section entitled REINSURANCE PREMIUM for the annual period during which the
accident occurs and the amount so reinstated divided by $10,000,000.
The reinsurance premium so developed for each amount reinstated shall be
in addition to the reinsurance premium set forth in the section entitled
REINSURANCE PREMIUM, and shall be paid by the Company immediately following
loss payment by the Reinsurers.
B-7
ENDORSEMENT NO. 1
Attached to and made a part of
EXHIBIT B
to
HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY EXCESS OF LOSS REINSURANCE
AGREEMENT
(HEREINAFTER REFERRED TO AS "AGREEMENT")
FOURTH EXCESS OF LOSS REINSURANCE OF
WORKERS' COMPENSATION BUSINESS
between
▇▇▇▇▇ INSURANCE COMPANY
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as the "Company")
and
The Subscribing Reinsurers executing
the Interests and Liabilities Agreements attached to this Agreement
(hereinafter collectively referred to as the "Reinsurers")
IT IS MUTUALLY AGREED that, as respects new and renewal policies of the
Company becoming effective at and after 12:01 A.M., July 1, 1996, and
policies in force at 12:01 A.M., July 1, 1996, Section 1 of Exhibit B is
amended to read:
"SECTION 1 - LIABILITY OF THE RElNSURERS
The Reinsurers shall pay to the Company with respect to accident
occurrence under Workers' Compensation business of the Company, the amount of
net loss sustained by the Company in excess of the sum of the Company
Retention and Underlying Reinsurance, but not exceeding the Limit of
Liability of the Reinsurers as set forth in the Schedule of Reinsurance, plus
a proportionate share of adjustment expense.
EXHIBIT C
Attached to and made a part of
HCI Agreement No. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
FIFTH EXCESS OF LOSS REINSURANCE
OF
WORKERS' COMPENSATION BUSINESS
SECTION 1 - LIABILITY OF THE REINSURERS
The Reinsurers shall pay to the Company with respect to each accident
under Workers' Compensation business of the Company, the amount of net loss
sustained by the Company in excess of the sum of the Company Retention and
Underlying Reinsurance, but not exceeding the Limit of Liability of the
Reinsurers as set forth in the Schedule of Reinsurance, plus a proportionate
share of adjustment expense.
SCHEDULE OF REINSURANCE
-------------------------------------------------------------------------------
Underlying Limit of Liability
Company Retention Reinsurance of the Reinsurers
-------------------------------------------------------------------------------
Each Accident Each Accident Each Accident
$200,000 $20,000,000 $10,000,000
-------------------------------------------------------------------------------
For the purpose of determining the amount of net loss sustained by the
Company, it is deemed that the amount of net loss any one employee shall not
exceed $2,000,000.
SECTION 2 - DEFINITIONS AND INTERPRETATIONS
(a) WORKERS' COMPENSATION BUSINESS
This term shall mean the insurance afforded by Parts One, Two, and
Three of a standard provisions Workers' Compensation and Employers'
Liability Policy and any endorsements attached thereto.
(b) ACCIDENT
This term shall mean each and every accident or occurrence or
series of accidents or occurrences arising out of one event,
whether involving one or several of the Company's policies and
regardless of the number of employees or employers involved.
(c) NET LOSS
This term shall mean all payments by the Company in settlement of
claims or losses, payment of compensation or other benefits, or
satisfaction of judgments or awards, after deduction of salvage,
and shall exclude adjustment expense and payments or liability in
excess of the Company's policy limit(s); however in the instance of
the insolvency of the Company, this definition shall be modified to
the extent set forth in the article entitled INSOLVENCY OF THE
COMPANY.
SECTION 3 - EXCLUSIONS
This Exhibit shall not apply to:
(a) Business accepted by the Company as reinsurance from other insurers;
(b) Insurance written by the aviation underwriting unit,
howsoever styled, of the Company or written by the Company as a
member of an aviation insurance group or pool or association;
(c) Any extra or non-contractual damages or legal fees and
expenses attendant to the defense thereof, including but not
limited to compensatory, exemplary and punitive damages or fines or
statutory penalties which are awarded against the Company as a
result of an act, omission, or course of conduct committed by or on
behalf of the Company;
(d) Insurance with respect to operations involving:
(1) Aircraft flight and ground operations;
(2) Amusement parks or devices, exhibitions
(including fireworks), carnivals, circuses;
(3) Caisson or ▇▇▇▇▇▇ dam work, dam, dike, lock or revetment
construction;
(4) Chemical manufacturing,
(5) Manufacturing, packing, handling or shipping of explosives,
explosive substances intended for use as an explosive,
ammunitions, fuses, arms or fireworks;
(6) Gas (including liquefied petroleum gas) companies, dealers,
distributors or construction;
(7) Maritime or federal employments, or steamship lines or agencies
or stevedoring;
C-2
(8) Mining or quarries;
(9) Oil or gas lease operators or contractors; oil or gas ▇▇▇▇▇
work; oil or gas pipeline construction or operations; oil rig
▇▇▇▇▇▇▇ work;
(10) Railroad operation or construction;
(11) Sewer, subway or water main construction, or shaft sinking or
tunneling;
(12) Wrecking;
(13) Bodily injury (including occupational disease) arising from the
manufacture, removal, installation, storage, mining, handling or
transportation of asbestos if the insured's operations, at the
time of policy issuance, present known and/or generally
recognizable asbestos exposures; however, this exclusion
shall not apply to the removal, installation, storage, handling
or transportation of asbestos if such removal, installation,
storage, handling or transportation is incidental to the
insured's overall operations.
The term "incidental", as used in this exclusion, is intended
to recognize the fact that certain insureds (such as, but not
limited to, plumbing, carpentry, etc. contractors) will
infrequently, but regularly, encounter asbestos within the
scope of their operations - even though their operations, as
such, do not involve the manufacture, removal, installation,
storage, mining, handling, or transportation of asbestos. This
exclusion does not apply to such "incidental" operations;
(e) Employers' Liability;
(f) Occupational disease losses defined as follows:
"Occupational disease" means any abnormal condition that fulfills all
of the following conditions:
(1) It is not traceable to a definite compensable accident occurring
during the employee's present or past employment;
(2) It has been caused by exposure to a disease-producing causative
agent present in the workers' occupational environment; and
(3) It has resulted in a disability or death;
(g) Cumulative injury losses defined as follows:
"Cumulative injury" means any injury that fulfills all of the
following conditions:
C-3
(1) It is not traceable to a definite compensable accident occurring
during the employee's present or present employment;
(2) It has occurred from, and has been aggravated by, a repetitive
employment-related activity;
(3) It has resulted in a disability or death."
(h) ▇▇▇▇▇ Act
(i) United States Longshoremen and Harborworkers Act;
(j) War, civil war,
(k) Insolvency funds;
(1) Excess and Surplus Lines;
(m) Professional sports teams;
(n) Nuclear incidents;
(o) Commercial airline personnel; flight and non-flight personnel.
If the Company provides insurance for an insured with respect to any
operations listed in one or more of the exclusions under (d), except
exclusion (d)(5), and such operations constitute only a minor and incidental
part of the total operations of the insured, such exclusion(s) shall not
apply.
SECTION 4 - REINSURANCE PREMIUM
The Company shall pay to the Reinsurers a net, i.e., not subject to
commission, reinsurance rate of 0.085% of the net premiums earned by the
Company on the business reinsured hereunder, subject to an annual minimum and
deposit reinsurance premium of $43,520.
SECTION 5 - REPORTS AND REMITTANCES
(a) REINSURANCE PREMIUM
On or before the first day of each calendar quarter commencing on
July 1, 1995, the Company shall pay to the Reinsurers one quarter
of the annual minimum and deposit reinsurance premium stipulated in
the section entitled REINSURANCE PREMIUM.
As soon as possible after June 30, 1996, and each subsequent June
30th, the Company shall furnish to the Reinsurers a statement of
the premium earned by the Company on the business reinsured
hereunder during the annual period ending on such June 30th. The
Company shall calculate the reinsurance premium thereon and remit
C-4
to the Reinsurers the amount of reinsurance premium, if any, in
excess of the annual minimum and deposit reinsurance premium.
(b) NOTICE OF CLAIMS
The Company will give written notice of loss under this Exhibit to
the Reinsurers not later than 60 months after the end of the annual
period from July 1st through June 30th during which the accident
occurs to be considered for claim payment. The Company shall also
promptly notify the Reinsurers in writing and thereafter promptly
and fully inform the Reinsurers in writing, of all negotiations
entered into by the Company concerning all claims which may involve
the reinsurance provided under this Exhibit, and shall provide the
Reinsurers prior written notice on any other action relating to
such claims including any payment of such claims by the Company.
The Company shall give prompt written notification to the
Reinsurers on any claim for which the Company has created a loss
reserve equal to or greater than 50 percent of the Company's
retention of this reinsurance. In addition, the Company shall
notify the Reinsurers in writing of any material changes in its
loss reserves. The Company further agrees to forward to the
Reinsurers copies of such pleadings and reports of investigations
as are pertinent to the claim and/or as may be requested by the
Reinsurers.
Upon receipt of a definitive statement of net loss and
adjustment expense from the Company, the Reinsurers shall pay
promptly to the Company the Reinsurers' portion of net loss and the
Reinsurers' portion of adjustment expense, if any. Any subsequent
changes shall be reported by the Company to the Reinsurers and the
amount due either party shall be remitted promptly.
(c) COMMUTATION OF LOSSES
60 months after the end of each annual period from July 1st through
June 30th, the Company shall advise the Reinsurers of any
outstanding claims or accidents during that annual period which
have not been finally settled and which may cause a claim under
this Exhibit.
The Reinsurers may then, or at any time thereafter, request that
their liability with respect to one or more of such unsettled
claims be commuted. Upon such request, the Reinsurers and the
Company shall review such claim and shall attempt to reach a
settlement by mutual agreement. If the Reinsurers and the Company
cannot reach a settlement by mutual agreement, then the Reinsurers
and the Company shall mutually appoint an independent actuary
(F.S.A./F.C.A.S. or A.S.A./A.C.A.S.) who shall investigate,
determine and capitalize the present value of any such unsettled
claims. In the event the Reinsurers and the Company cannot reach an
agreement on a independent actuary, each party shall appoint an
actuary. The two chosen actuaries shall then select a third
actuary. If either party refuses or neglects to appoint an actuary
within 30 days after receipt of the written request for
commutation, the requesting party may appoint a second actuary. If
the two actuaries
C-5
fail to agree on the selection of a third actuary within 30 days of
their appointment, each of them shall name three individuals, of
whom the other shall decline two, and the decision shall be made by
drawing lots. All actuaries selected by drawing lots shall be
disinterested in the outcome of the commutation. The decision of
the majority shall be final and binding upon the parties.
Any payment by the Reinsurers under this paragraph (c) shall
constitute a complete release of the Reinsurers for their liability
as respects any such claim. The cost of any independent actuary
shall be shared on an equal basis by the Reinsurers and the Company.
SECTION 6 - COMMENCEMENT AND TERMINATION
This Exhibit applies to new and renewal policies of the Company becoming
effective at and after 12:01 A.M., July 1, 1995, and to policies in force at
12:01 A.M., July 1, 1995, for claims and losses resulting from accidents
occurring at and after the aforesaid time and date.
This Exhibit may be terminated on any June 30th by either party sending
to the other, by registered mail to its principal office, not less than 90
days prior written notice. The Reinsurers shall not be liable for any claims
or losses resulting from accidents occurring after the effective time and
date of termination.
Notwithstanding the foregoing, if the Company is merged with or
purchased by another Company, or if controlling interest is sold or changed
so as to produce a loss in control over conduct of the business by the
current owners, the Company shall immediately notify the Reinsurers by
registered mail to its principal office giving details (to the extent of its
knowledge thereof) of the particulars of such merger, change, sale or
purchase. Within 35 days after the date of mailing of such notice by the
Company, the Reinsurers may terminate this Exhibit in its entirety by sending
to the Company, by registered mail to its principal office, notice stating
the time and date when not less than 5 days after the date of mailing of such
notice, termination shall be effective.
If the Company fails to notify the Reinsurers of such merger, purchase,
change or sale, the Reinsurers, within 35 days after the Reinsurers have
acquired knowledge of the merger, purchase, change or sale, may terminate
this Exhibit in its entirety by sending to the Company, by registered mail to
its principal office, notice stating the time and date when, not less than 5
days after the mailing of such notice, termination shall be effective.
In any instance that the Reinsurers terminate this Exhibit in accordance
with the two previous paragraphs, the Reinsurers shall not be liable for
claims or losses resulting from accidents occurring after the effective time
and date of termination.
SECTION 7 - REINSTATEMENT
The Limit of Liability of the Reinsurers under this Exhibit with respect
to each accident shall be reduced by an amount equal to the amount of
liability paid by the Reinsurers, but that part of the liability of the
Reinsurers that is so reduced shall be automatically reinstated, subject to
the maximum payment of $20,000,000 of net loss with respect to all accidents
occurring during each annual period from July 1st through June, that this
Exhibit is in effect.
C-6
In consideration of this automatic reinstatement, the Company shall pay
to the Reinsurers for each amount reinstated an additional reinsurance
premium which shall be the product of the annual reinsurance premium set
forth in the section entitled REINSURANCE PREMIUM for the annual period
during which the accident occurs and the amount so reinstated divided by
$10,000,000.
The reinsurance premium so developed for each amount reinstated shall be
in addition to the reinsurance premium set forth in the section entitled
REINSURANCE PREMIUM, and shall be paid by the Company immediately following
loss payment by the Reinsurers.
C-7
ENDORSEMENT NO. 1
Attached to and made a part of
EXHIBIT C
to
HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
(HEREINAFTER REFERRED TO AS "AGREEMENT")
FIFTH EXCESS OF LOSS REINSURANCE
OF
WORKERS' COMPENSATION BUSINESS
between
▇▇▇▇▇ INSURANCE COMPANY
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as the "Company")
and
The Subscribing Reinsurers executing
the Interests and Liabilities Agreements attached to this Agreement
(hereinafter collectively referred to as the "Reinsurers")
IT IS MUTUALLY AGREED that, as respects new and renewal policies of the
Company becoming effective at and after 12:01 A.M., July 1, 1996, and
policies in force at 12:01 A.M., July 1, 1996, Section 1 of Exhibit C is
amended to read:
"SECTION 1 - LIABILITY OF THE REINSURERS
"The Reinsurers shall pay to the Company with respect to each accident
under Workers' Compensation business of the Company, the amount of net loss
sustained by the Company in excess of the sum of the Company Retention and
Underlying Reinsurance, but not exceeding the Limit of Liability of the
Reinsurers as set forth in the Schedule of Reinsurance, plus a proportionate
share of adjustment expense.
Effective: July 1, 1995
INTERESTS AND LIABILITIES AGREEMENT
TO
HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
between
▇▇▇▇▇ INSURANCE COMPANY
Pasadena, California
and
SKANDIA AMERICA REINSURANCE CORPORATION
New York, New York
(hereinafter referred to as the "Subscribing Reinsurer")
-------------------------------------------------------------------------------
The Subscribing Reinsurer agrees to assume the following shares of the
liability under the Workers' Compensation and Employers' Liability Excess of
Loss Cover set forth in the attached Agreement:
5.00% of Exhibit A
Nil% of Exhibit B
Nil% of Exhibit C
As consideration the Subscribing Reinsurer shall receive identical
shares of the premiums named therein.
The shares of the Subscribing Reinsurer shall be separate and apart from the
shares of the other Reinsurers. and the Subscribing Reinsurer shall in no
event participate in the Interests and Liabilities of the other Reinsurers.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate this 22nd day of January, 1996.
▇▇▇▇▇ INSURANCE COMPANY
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
SKANDIA AMERICA REINSURANCE CORPORATION
Attest: /s/ [ILLEGIBLE] /s/ [ILLEGIBLE]
VICE PRESIDENT VICE PRESIDENT
Effective: July 1, 1996
ADDENDUM NO. 1
to
INTERESTS AND LIABILITIES AGREEMENT
attached to and made a part of
HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
between
▇▇▇▇▇ INSURANCE COMPANY
Pasadena, California
and
SKANDIA AMERICA REINSURANCE CORPORATION
New York, New York
(hereinafter referred to as the "Subscribing Reinsurer")
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The Subscribing Reinsurer acknowledges and accepts the attachment of the
TERMINATION ENDORSEMENT to Exhibit A of the Workers' Compensation and
Employers' Liability Excess of Loss Reinsurance Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed in duplicate this 19th day of November 1996/
/s/ [ILLEGIBLE]
▇▇▇▇▇ INSURANCE COMPANY
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ [ILLEGIBLE]
SKANDIA AMERICA REINSURANCE CORPORATION
Attest: /s/ [ILLEGIBLE]
Effective: July 1, 1995
INTERESTS AND LIABILITIES AGREEMENT
to
HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
between
▇▇▇▇▇ INSURANCE COMPANY
Pasadena, California
and
PINEHURST ACCIDENT REINSURANCE GROUP
Philadelphia, Pennsylvania
(hereinafter referred to as the "Subscribing Reinsurer")
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The Subscribing Reinsurer agrees to assume the following shares of the
liability under the Workers' Compensation and Employers' Liability Excess of
Loss Cover set forth in the attached Agreement:
Nil% of Exhibit A
100.00% of Exhibit B
25.00% of Exhibit C
As consideration the Subscribing Reinsurer shall receive identical
shares of the premiums named therein.
The shares of the Subscribing Reinsurer shall be separate and apart from the
shares of the other Reinsurers, and the Subscribing Reinsurer shall in no
event participate in the Interests and Liabilities of the other Reinsurers.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate this 22nd day of January,1996.
▇▇▇▇▇ INSURANCE COMPANY
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
PINEHURST ACCIDENT REINSURANCE GROUP
Via: Reinsurance Management Services, Inc.
Attest: /s/ [ILLEGIBLE]
/s/ [ILLEGIBLE]
Effective: July 1, 1996
ADDENDUM NO. 1
to
INTERESTS AND LIABILITIES AGREEMENT
attached to and made a part of
HCI AGREEMENT NO. 380
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
between
▇▇▇▇▇ INSURANCE COMPANY
Pasadena, California
and
PINEHURST ACCIDENT REINSURANCE GROUP
Philadelphia, Pennsylvania
(hereinafter referred to as the "Subscribing Reinsurer")
-------------------------------------------------------------------------------
The Subscribing Reinsurer acknowledges and accepts the attachment of the
ENDORSEMENT No. 1 to Exhibit B and ENDORSEMENT No. 1 to Exhibit C of the
Workers' Compensation and Employers' Liability Excess of Loss Reinsurance
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed in duplicate this 19th day of November 1996.
/s/ [ILLEGIBLE]
▇▇▇▇▇ INSURANCE COMPANY
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
PINEHURST ACCIDENT REINSURANCE GROUP
Via. Reinsurance Management Services, Inc.
Attest: /s/ [ILLEGIBLE]
Effective: July 1, 1995
INTERESTS AND LIABILITIES AGREEMENT
to
HCI AGREEMENT NO. 38O
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
between
▇▇▇▇▇ INSURANCE COMPANY
Pasadena, California
and
NORTHWESTERN NATIONAL LIFE INSURANCE COMPANY
Philadelphia, Pennsylvania
(hereinafter referred to as the "Subscribing Reinsurer")
-------------------------------------------------------------------------------
The Subscribing Reinsurer agrees to assume the following shares of the
liability under the Workers' Compensation and Employers' Liability Excess of
Loss Cover set forth in the attached Agreement:
Nil% of Exhibit A
Nil% of Exhibit B
75.00% of Exhibit C
As consideration the Subscribing Reinsurer shall receive identical
shares of the premiums named therein.
The shares of the Subscribing Reinsurer shall be separate and apart from the
shares of the other Reinsurers, and the Subscribing Reinsurer shall in no
event participate in the Interests and Liabilities of the other Reinsurers.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate this 22nd day of January, 1996.
/s/ [ILLEGIBLE]
▇▇▇▇▇ INSURANCE COMPANY
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
NORTHWESTERN NATIONAL LIFE INSURANCE COMPANY
Attest: /s/ [ILLEGIBLE] /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Assistant Vice President Assistant Vice President
Effective: July 1, 1996
INTERESTS AND LIABILITIES AGREEMENT
attached to and made a part of
HCI AGREEMENT NO. 38O
WORKERS' COMPENSATION AND EMPLOYERS' LIABILITY
EXCESS OF LOSS REINSURANCE AGREEMENT
between
▇▇▇▇▇ INSURANCE COMPANY
Pasadena, California
and
RELIASTAR LIFE INSURANCE COMPANY
(FORMERLY NORTHWESTERN NATIONAL LIFE INSURANCE COMPANY)
Philadelphia, Pennsylvania
(hereinafter referred to as the "Subscribing Reinsurer")
-------------------------------------------------------------------------------
The Subscribing Reinsurer acknowledges and accepts the attachment of the
ENDORSEMENT No. 1 to Exhibit C of the Workers' Compensation and Employers'
Liability Excess of Loss Reinsurance Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed in duplicate this 19th day of November 1996.
/s/ [ILLEGIBLE]
▇▇▇▇▇ INSURANCE COMPANY
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
RELIASTAR LIFE INSURANCE COMPANY
(formerly NORTHWESTERN NATIONAL
LIFE INSURANCE COMPANY)
Attest: /s/ [ILLEGIBLE] /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Assistant Vice President Assistant Vice President
