EXHIBIT 10.27
CNA Ref: 44 FIR
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Reassured:- CNA International Reinsurance Company Limited
Period:- Continuous contract in respect of all business
written by the Reassured and signed into their 1994
and subsequent Underwriting Years of Account
Subject to three months prior notice of cancellation
to expire at 31st December any year.
HEREON: SIGNING SLIP IN RESPECT OF 1997 UNDERWRITING
YEAR OF ACCOUNT.
Type:- Quota Share Treaty
Class:- The Reassured's Account of PROPERTY CATASTROPHE
EXCESS OF LOSS TREATIES (including specific peril
aggregate excess of loss written for a single
territory) underwritten in their London Office.
Excluding the Reinsured's interest whether direct or
by way of reinsurance in loss arising from claim or
claims against an Insured by another party or
parties.
Notwithstanding the foregoing this reinsurance shall
not exclude:
(a) Workers' Compensation and/or Employers' Liability
losses arising from the following perils:-
Fire, Lightning, Explosion, Structural Collapse,
Windstorm, Hail, Flood, Seismic Activity, Volcanic
Eruption, Collision, Riots, Strikes, Civil Commotion,
Malicious Damage.
(b) Any Physical Damage and/or Consequential loss
coverage contingent thereon effected by an Insured on
behalf of another party.
Territorial Scope:- Worldwide excluding USA & Canada, other than
incidental.
Treaty Detail:- To take 50% Quota Share of the Reassured's
participation subject to a maximum cession hereon of
GBP 2,000,000 ($3,000,000) any one programme.
Cessions in currencies other than sterling at rates
of exchange as used in the books of the Reassured.
Rate:- Original Net Premium as Original.
Administrative
Processing Fee:- 4.0% on Original Net Rate.
Taxes:- As may be applicable on the original business.
CNA Ref:44 FIR
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Premium Reserve:- Not applicable.
Loss Reserve:- As may be applicable on the original business.
Portfolio:- Agreed, if and when requested by the Reassured, to
close each Underwriting Year of Account at any time
after the end of the third year at an amount
sufficient to cover all outstanding losses as may be
mutually agreed.
Cash Loss:- At Reassured's discretion, Minimum $5,000,000.
Accounts:- Quarterly Accounts in GBP and US$ separately on each
year of account. Presentation within 45 days of end
of quarter with settlement due within 30 days
thereafter.
General Conditions:- Monthly bordereau of risks ceded each January,
February and March, quarterly thereafter.
Full Reinsurance Clause
War Exclusion G51
Nuclear Energy Risks Exclusion Clause
(Reinsurance) 1984, NMA 1975 (Japanese Amendment)
Nuclear Incident Exclusion Clauses - Physical
Damage Reinsurance - USA & Canada
Excluding Financial Guarantee and Insolvency
Maximum Net Premium ceded hereon $22m
Normal Maximum aggregate cession per country or
territorial zone hereon GBP 30,000,000 exception is
United Kingdom where maximum aggregate ceded
is agreed at GBP 50,000,000.
Insolvency Clause G86.
Special cessions to be agreed by Reinsurers prior to
binding Multi Year policies accepted by annual
re-signing.
Wording:- As before as far as applicable, any amendments to be
agreed.
Information:- 1997 Est. Net Premium Income US$ 15.4m (net of
brokerage).
Underwriting Authority as follows:-
Xxx Xxxxxxx VP - Full Underwriting
Authority
Xxxxx Xxxxxxx AVP - Full Underwriting
Authority
Xxxx Xxxxx U/W - New & Renewals
Xxxxx Xxxxxxx Dep. U/W - New & Renewals
Xxx Xxxxxx Asst. U/W - Renewals
HEREON: 100% LaSalle Re
Signed /s/ Xxxxxx Xxxxx Dated 23\1\97
......................... ...........................
on behalf of LaSalle Re
TITLE: NON-OBLIGATORY QUOTA SHARE
REINSURANCE AGREEMENT
BETWEEN: CNA INTERNATIONAL REINSURANCE
COMPANY LIMITED
AND
LA SALLE RE LTD
COMMENCING: 1ST JANUARY, 1994
NON-OBLIGATORY QUOTA SHARE REINSURANCE AGREEMENT
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made between
CNA INTERNATIONAL REINSURANCE COMPANY LIMITED
(hereinafter referred to as 'the Reassured')
and
LA SALLE RE LTD
(hereinafter referred to as 'the Reinsurers')
PREAMBLE
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This Agreement is made and entered into between CNA International Reinsurance
Company Ltd (hereinafter referred to as "the Reassured") and La Salle Re Ltd
(hereinafter referred to as "the Reinsurers"), on the following terms and
conditions.
ARTICLE 1
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BUSINESS REINSURED
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This Agreement applies to policies and/or contracts of insurance and/or
reinsurance allocated by the Reassured to its account of Property Catastrophe
Excess of Loss Treaties (including specific peril aggregate excess of loss
written for a single territory) written or renewed by the Reassured in its
London Office.
ARTICLE 2
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COVER, LIMIT AND RETENTION
--------------------------
The Reassured may cede and the Reinsurers shall accept by way of reinsurance
under this Agreement, 50% Quota Share of all cessions coming within the scope of
this Agreement, subject to a maximum Quota Share of cessions hereto of
(pounds)2,000,000 or US$3,000,000 for any one programme.
The Reassured shall retain the remaining 50% Quota Share for its own account
but, without prejudice to the above, shall be at liberty to protect that
retention by way of reinsurance for its own account and benefit.
The maximum aggregate cession hereto per country or territorial zone is
(pounds)30,000,000.
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ARTICLE 3
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TERRITORIAL SCOPE
-----------------
This Agreement shall cover wherever cessions hereto cover other than losses
occurring in the United States of America and/or Canada except where such loss
exposures are incidental to the main hazard.
ARTICLE 4
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PERIOD
------
This Agreement takes effect on 1st January 1994 and applies to all business
written or renewed by the Reassured and signed into its 1994 and/or subsequent
Underwriting Years of Account.
This Agreement shall remain in full force and effect unless and until terminated
on 31st December 1994 or on any subsequent 31st December by either party giving
to the other not less than three months prior written notice.
For the purposes of this Agreement, the term of and participations in this
Agreement shall be divided into separate Underwriting Years, each for twelve
months commencing on 1st January.
Each cession made by the Reassured and all accounting transactions relating
thereto, shall be allocated by the Reassured to One Underwriting Year.
In the event of cancellation, all cessions in force at Midnight on the date of
cancellation shall remain covered under this Agreement until their individual
natural expiration or termination whichever occurs first.
Notwithstanding anything to the contrary contained in this Article, either party
shall have the right to terminate this Agreement by giving the other party
notice:-
(a) if the performance of the whole or any part of this Agreement be prohibited
or rendered impossible de jure or de facto in particular and without
prejudice to the generality of the preceding words in consquence of any law
or regulation which is or shall be in force in any country or territory or
if any law or regulation shall prevent directly or indirectly the
remittance of any or all or any part of the balance of payments due to or
from either party;
(b) if the other party has become insolvent or unable to pay its debts or has
lost the whole or any part of its paid up capital;
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(c) if there is any material change in the ownership or control
of the other party;
(d) if the country or territory in which the other party resides or has its
head office or is incorporated shall be involved in armed hostilities with
any other country whether war be declared or not or is partly or wholly
occupied by another power;
(e) if the other party shall have failed to comply with any of
the terms and conditions of this Agreement.
All notices of termination in accordance with any of the provisions of this
Article shall be by Telex or telegram and shall be deemed to be served upon
despatch or, where communications between the parties are interrupted, upon
attempted despatch.
All notices of termination served in accordance with any of the provisions of
this Article shall be addressed to the party concerned at its head office or at
any other address previously designated by that party.
In the event of this Agreement being terminated at any date other than its
natural expiry then the premium due to the Reinsurers shall be calculated upon
the Original Net Premium income of the Reassured up to the date of termination.
ARTICLE 5
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FOLLOW THE FORTUNES
-------------------
The Reinsurers' liability to the Reassured in respect of all cessions under
this Agreement shall follow the liability of the Reassured to its reinsureds.
ARTICLE 6
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FULL REINSURANCE
----------------
The Reinsurers agree to follow and abide by all agreements, actions and/or
settlements made by the Reassured and to agree, with or without notice, all
alterations and/or additions and/or extensions made under the original cessions
subsequent to the effecting of this Agreement, subject to the conditions of this
Agreement.
The Reinsurers expressly agree to pay in all respects as may be paid on the
original cessions liable or not liable, including in addition where applicable a
pro rata share of legal and/or other special expenses when incurred by the
Reassured.
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ARTICLE 7
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EXCLUSIONS
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This Agreement does not cover:
A. any liability assumed by the Reassured for loss or damage directly or
indirectly occasioned by, happening through or in consequence of war,
invasion, acts of foreign enemies, hostilities or war-like operations
(whether war be declared or not), civil war, mutiny, civil commotion
assuming the proportions of or amounting to a popular rising, insurrection,
rebellion, revolution, military or usurped power, martial law, confiscation
or nationalisation or requisition or destruction of or damage to property
by or under the order of any Government or public or local authority.
However, the foregoing exclusion shall not apply to those classes of
business which are written in accordance with the War and Civil War
Exclusion Agreement and/or the War and Civil War Risk Exclusion Agreement
nor to business outside the scope of such Agreements unless such classes of
business are not covered by this Agreement.
In respect of losses arising in the United Kingdom only (other than in
respect of losses arising under those classes of business covered hereunder
which contain a War Inclusion Clause and such other classes of business
covered hereunder for which there is no Market requirement for such other
classes of business to contain a War Exclusion Clause by virtue of the
operation of the War and Civil War Exclusion Agreement and/or the War and
Civil War Risk Exclusion Agreement), this Agreement shall not cover any
liability assumed by the Reassured for loss or damage directly or
indirectly occasioned by, happening through or in consequence of any act of
any person or persons acting on behalf of or in connection with any
organisation the objects of which are to include the overthrowing or
influencing of any de jure or de facto government by terrorism or by any
violent means;
B. the Reassured's interest whether direct or by way of reinsurance in loss
arising from claim or claims against an insured by another party or
parties.
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Notwithstanding the foregoing this Agreement shall not exclude:
1) Workers' Compensation and/or Employers' Liability losses arising from
the following perils:-
Fire, Lightning, Explosion, Structural Collapse, Windstorm, Hail,
Flood, Seismic Activity, Volcanic Eruption, Collision, Riots, Strikes,
Civil Commotion, Malicious Damage;
2) Any Physical Damage and/or Consequential loss coverage contingent
thereon effected by an insured on behalf of another party.
C. Financial Guarantee and Insolvency.
D. Nuclear Risks for those applicable classes of business and territories as
appropriate in accordance with the clause referred to below and which shall
form an integral part hereof, copies of which are on file with the
Reassured:-
NUCLEAR ENERGY RISKS EXCLUSION CLAUSE (REINSURANCE) (1984) - WORLDWIDE
EXCLUDING U.S.A. AND CANADA - NMA 1975
Notwithstanding the provisions this Clause, in respect of Japanese business
certain liabilities, the type of which by market practice and custom have
not been declared to the Japanese Nuclear Pool shall not fall within the
scope of this exclusion.
ARTICLE 8
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PREMIUM
-------
In consideration of the liabilities undertaken by the Reinsurers in accordance
with the terms of this Agreement, the Reassured shall pay to the Reinsurers
their 50% Quota Share proportion of the Reassured's Original Net Premium in
respect of all cessions hereto.
The term "Original Net Premium" shall, for all purposes of this Agreement, be
understood to mean the full gross amount of the premiums paid to the Reassured
under the original cessions by their original insureds or reinsureds, less all
original commissions, brokerage and taxes.
The maximum Original Net Premium to be ceded to this Agreement for any one
Underwriting Year shall be $18,000,000.
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ARTICLE 9
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ADMINISTRATIVE PROCESSING FEE
-----------------------------
The Reinsurers agree to allow the Reassured to deduct and retain for its own
benefit as administrative processing fee 2.5% of the Original Net Premium
payable to the Reinsurers in accordance with the terms of Article 8, "Premium".
ARTICLE 10
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LOSSES AND LOSS EXPENSES
------------------------
All loss settlements made by the Reassured, whether under strict policy
conditions or by compromise, shall be unconditionally binding upon the
Reinsurers who shall be liable for their Quota Share proportion thereof and of
all expenses (other than the salaries of employees and office expenses of the
Reassured) incurred by the Reassured in connection therewith.
The Reinsurers shall benefit in their Quota Share proportion from any salvage or
recoveries effected by the Reassured for the benefit of itself and the
Reinsurers.
Losses which the Reassured has paid shall be debited to the Reinsurers in the
quarterly accounts rendered in accordance with Article 11, "Accounts, Reports
and Payments" but, in the event of the Reassured sustaining a loss in respect of
which the 100% Quota Share proportion amounts to or exceeds $5,000,000 any one
occurrence, the Reassured shall have the option of requiring the Reinsurers to
effect payment as soon as practicable upon submission of proof of loss.
ARTICLE 11
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ACCOUNTS, REPORTS AND PAYMENTS
------------------------------
The Reassured shall render a separate quarterly statement of account for each
Underwriting Year of Account during which this Agreement is in force showing a
total of all premiums ceded to this Agreement during such quarter. The Reassured
shall also furnish a separate quarterly loss statement for each such
Underwriting Year of Account, showing losses paid, loss expenses and salvages
coming within the terms of this Agreement and entered into the Reassured's books
during such quarter.
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The quarterly accounts shall be rendered within forty-five days after the end of
each quarter. All accounts shall be rendered and settled in Sterling.
Balances due to the Reinsurers shall be paid on delivery of the accounts,
balances due to the Reassured shall be paid together with the confirmation but
not later than thirty days after the receipt of the accounts. In case of
objections, however, the amount not in dispute shall be paid at once and the
difference as soon as agreement has been reached.
The Reassured shall furnish quarterly bordereaux of cessions hereto.
ARTICLE 12
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COMMUTATION
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If mutually agreed by the Reassured and the Reinsurers, at thirty-six months
following the commencement of any Underwriting Year of this Agreement, or at any
time thereafter, the Reassured may discharge the Reinsurers from all and/or
further liability in respect of such Underwriting Year. The Reassured will
prepare a report evaluating loss reserves and liabilities to establish a basis
for the discussion of commutation. The payment by the Reinsurers of an amount
mutually agreed will constitute a complete and final release of the Reinsurers
in respect of all liability relating to such Underwriting Year.
ARTICLE 13
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LOSS RESERVES
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Where required by original ceding companies, outstanding loss reserves will be
established by the Reassured and reference thereto shall be included in the
quarterly bordereaux referred to in Article 11 "Accounts, Reports and Payments".
ARTICLE 14
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CURRENCY
--------
The currency to be used for all purposes of this Agreement shall be Pounds
Sterling. Cessions in currencies other than Pounds Sterling shall be converted
to Pounds Sterling at the rates of exchange used in the Reassured's books.
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ARTICLE 15
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INSOLVENCY OF THE REASSURED
---------------------------
Amounts due to the Reassured under this Agreement shall be payable by the
Reinsurers on the basis of the liability of the Reassured under the cessions
hereto without diminution because of the insolvency of the Reassured.
In the event of the insolvency of the Reassured, the Liquidator or Receiver or
Statutory Successor of the Reassured shall give written notice to the Reinsurers
of the pendency of any claim against the insolvent Reassured on the cessions
hereto within a reasonable time after such claim is filed in the insolvency
proceedings. During the pendency of such claim the Reinsurers may investigate
such claim and intervene, at their own expense, in the proceedings where such a
claim is to be adjudicated and interpose any defence or defences which they may
deem available to the Reassured or its Liquidator or Receiver or Statutory
Successor. The expense thus incurred by the Reinsurers shall be chargeable,
subject to court approval, against the insolvent Reassured as part of the
expense of liquidation to the extent of a proportionate share of the benefit
which may accrue to the Reassured solely as a result of the defence so
undertaken by the Reinsurers.
When two or more Reinsurers are involved in the same claim and a majority in
interest elect to investigate the claim and/or interpose defence to such claim,
the expense shall be apportioned in accordance with the terms of the above
paragraph as though such expense had been incurred by the Reassured.
Should the Reassured go into liquidation or should a receiver be appointed, the
Reinsurers shall be entitled to deduct from any sums which may be or may become
due to the Reassured under this Agreement any sums which are due to the
Reinsurers from the Reassured under this Agreement and which are payable at a
fixed or stated date, as well as any other sums due to the Reinsurers which are
permitted to be offset under applicable law.
In the event of the insolvency of the Reassured, the amounts due to the
Reassured under this Agreement shall be payable by the Reinsurers directly to
the Reassured or to its Liquidator, Receiver or Statutory Successor.
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ARTICLE 16
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DELAYS, ERRORS OR OMISSIONS
---------------------------
No inadvertent delay, error or omission shall be held to relieve either party
hereto of any liability which would have attached to them under this Agreement
if such delay, error or omission had not been made, provided that rectification
is made immediately upon discovery.
ARTICLE 17
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AMENDMENTS AND ALTERATIONS
--------------------------
The terms herein contained comprise the whole Agreement between the Reassured
and the Reinsurers and may only be changed in writing, signed by or on behalf
of both parties.
ARTICLE 18
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ACCESS TO RECORDS
-----------------
All documents and records in the possession of the Reassured concerning this
Agreement shall be made available upon reasonable notice at the request of the
Reinsurers for inspection by the Reinsurers or their nominated representatives
for the purposes of obtaining information concerning this Agreement or the
subject matter hereof.
For the avoidance of doubt, the rights given to the Reinsurers by this Article
shall continue in effect notwithstanding the termination of this Agreement and
shall be exercised at the Reinsurers' own expense.
ARTICLE 19
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OFFSET
------
Each party hereto shall have and may exercise in the event of the insolvency of
the other or the non-payment by the other of obligations where due hereunder,
the right to offset any balance or balances whether on account or premiums,
commissions, claims or losses, adjustment expenses, salvage or any other amount
due from that party to the other party hereto under this Agreement against the
balance or balances due or to become due to the offsetting party from the other
party under this Agreement.
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ARTICLE 20
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ARBITRATION
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1. All matters in difference between the parties arising under, out of or in
connection with this Agreement, including formation and validity, and
whether arising during or after the period of this Agreement, shall be
referred to an arbitration tribunal in the manner hereinafter set out.
2. Unless the parties appoint a sole arbitrator within 14 days of one
receiving a written request from the other for arbitration, the claimant
(the party requesting arbitration) shall appoint his arbitrator and give
written notice thereof to the respondent. Within 30 days of receiving such
notice the respondent shall appoint his arbitrator and give written notice
thereof to the claimant, failing which the claimant may apply to the
appointor hereafter named to nominate an arbitrator on behalf of the
respondent.
3. Before they enter upon a reference the two arbitrators shall appoint a
third arbitrator. Should they fail to appoint such a third arbitrator
within 30 days of the appointment of the respondent's arbitrator then
either of them or either of the parties may apply to the appointor for the
appointment of the third arbitrator. The three arbitrators shall decide by
majority. If no majority can be reached the verdict of the third arbitrator
shall prevail. He shall also act as chairman of the tribunal.
4. Unless the parties otherwise agree the arbitration tribunal shall consist
of persons (including those who have retired) with not less than ten years
experience of insurance or reinsurance as persons engaged in the industry
itself or as lawyers or other professional advisers.
5. The arbitration tribunal shall, so far as is permissible under the law and
practice of the place of arbitration, have power to fix all procedural
rules for the holding of the arbitration including discretionary power to
make orders as to any matters which it may consider proper in the
circumstances of the case with regard to pleadings, discovery, inspection
of the documents, examination of witnesses and any other matter whatsoever
relating to the conduct of the arbitration and may receive and act upon
such evidence whether oral or written strictly admissible or not as it
shall in its discretion think fit.
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6. The appointor shall be the Chairman for the time being of XXXXX (UK) or if
he is unavailable or it is inappropriate for him to act for any reason,
such person as may be nominated by the Committee of XXXXX (UK). If for any
reason such persons decline or are unable to act, then the appointor shall
be the Judge of the appropriate Courts having jurisdiction at the place of
arbitration.
7. All costs of the arbitration shall be determined by the arbitration
tribunal who may, taking into account the law and practice of the place of
arbitration, direct to and by whom and in what manner they shall be paid.
8. The place of arbitration may be chosen by the parties, but in default of
such choice, the place of arbitration shall be London, England.
9. The proper law of this Agreement shall be the law of England.
10. The award of the arbitration tribunal shall be in writing and binding upon
the parties who consent to carry out the same.
ARTICLE 21
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PARTICIPATION
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This Agreement obligates the Reinsurers for their proportion of the interests
and liabilities set forth in this Agreement.
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IN WITNESS WHEREOF the parties hereto have, by their duly authorised
representative, executed this Agreement as follows:
Signed in London, England, this 11th day of April 1994
For and on behalf of the Reassured: /s/ X. Xxxxxx
CNA INTERNATIONAL REINSURANCE CO. LTD
And
Signed in Xxxxxxxx, Bermuda, this 26th day of September 1994.
For and on behalf of the Reinsurers. /s/ Xxx Xxxxxxxxxxx
Xxx Xxxxxxxxxxx
Chief Underwriter
LASALLE RE LIMITED
