Exhibit (g)(iv)
REINSURANCE AGREEMENT #6272-1
(FACULTATIVE YRT BULK UNIVERSAL LIFE)
(hereinafter referred to as "Agreement")
between
SECURITY EQUITY LIFE INSURANCE COMPANY
(ARMONK, NEW YORK)
(hereinafter referred to as the "Company")
and
LIFE REASSURANCE CORPORATION OF AMERICA
(STAMFORD, CONNECTICUT)
(hereinafter referred to as "Life Re")
EFFECTIVE: MARCH 15, 1996
Life Re Logo
LIFE REASSURANCE CORPORATION OF AMERICA
000 XXXX XXXXX XXXX
XXXXXXXX, XX 00000
TABLE OF CONTENTS
PREAMBLE ............................................................. 1
ARTICLE I - METHOD OF REINSURANCE AND INSURANCE ...................... 1
1. Effective Date ....................................... 1
2. Method ............................................... 1
3. Amounts .............................................. 1
ARTICLE II - FACULTATIVE REINSURANCE ................................. 2
ARTICLE III - PROCEDURES FOR REPORTING ............................... 2
1. General Information................................... 2
2. Self-Administered Reporting .......................... 2
ARTICLE IV - PREMIUMS ................................................ 5
1. Life Insurance........................................ 5
2. Premium Taxes ........................................ 5
3. Payments ............................................. 5
4. Nonpayment of Reinsurance Premiums.................... 5
5. Interest on Delinquent Payments ...................... 6
6. Misstatements ........................................ 6
ARTICLE V - CLAIMS ................................................... 6
1. Notice ............................................... 6
2. Contested Claims ..................................... 6
3. Expenses ............................................. 7
4. Misstatements ........................................ 7
5. Payment .............................................. 7
6. Assistance and Advice ................................ 7
ARTICLE VI - REDUCTIONS, REINSTATEMENTS & CHANGES .................... 8
1. Reductions and Terminations .......................... 8
2. Reinstatements ....................................... 8
3. Nonforfeiture Benefits ............................... 8
4. Contractual Conversions and Exchanges ................ 9
5. Non Contractual Exchanges ............................ 9
6. Program of Internal Replacement ...................... 9
ARTICLE VII - DAC TAX ................................................ 9
ARTICLE VIII - RECAPTURE ............................................. 10
1. Standards for Recapture............................... 10
2. Method of Recapture................................... 10
ARTICLE IX - INSOLVENCY .............................................. 11
Life Re Agreement #6272-1 (i) Life Re Logo
Table of Contents..
ARTICLE X - ARBITRATION .............................................. 11
ARTICLE XI - GENERAL PROVISIONS ...................................... 12
1. Reinsurer's Right of Notice of Unusual Practices ..... 12
2. Policy Forms and Rates ............................... 13
3. Reinsurance Conditions ............................... 13
4. Errors and Omissions ................................. 13
5. Offset ............................................... 13
6. Inspection ........................................... 14
7. Entire Agreement ..................................... 14
8. Amendment ............................................ 14
9. Counterparts ......................................... 14
10. No Assignment ........................................ 14
11. Binding Effect ....................................... 14
12. Notices .............................................. 15
ARTICLE XII - DURATION OF AGREEMENT .................................. 16
ARTICLE XIII - EXECUTION ............................................. 17
Schedule A - Retention Limits, Plans Covered
Schedule B - Reporting Forms
Schedule C - Premium Rates
Schedule D - Discounts
Life Re Agreement #6272-1 (ii) Life Re Logo
PREAMBLE
This Reinsurance Agreement ("Agreement") is entered into by and between
SECURITY EQUITY LIFE INSURANCE COMPANY, a New York insurance corporation (the
"Company") and LIFE REASSURANCE CORPORATION OF AMERICA, a Connecticut insurance
corporation ("Life Re"). The Company and Life Re mutually agree to reinsure on
the terms and conditions set forth in this Agreement. This Agreement is solely
between the Company and Life Re, and performance of the obligations of each
party under this Agreement will be rendered solely to the other party. In no
instance will anyone other than the Company or Life Re have any rights under
this Agreement.
ARTICLE I - METHOD OF REINSURANCE AND INSURANCE
1. Effective Date
The reinsurance under this Agreement is effective as of March 15, 1996.
2. Method
Reinsurance of life insurance risks ("Life Insurance") under this
Agreement is on the yearly renewable term ("YRT") plan for the amount at risk
under the policy reinsured. The Company may cede and Life Re may accept
reinsurance under the policies or plans set forth in Schedule A, written by the
Company on citizens of the United States or Canada, domiciled in the United
States or Canada at the time of application. The policies set forth in Schedule
A that are reinsured under this Agreement are hereinafter referred to
collectively as "Reinsured Policies" and individually as a "Reinsured Policy."
Said policies will have been underwritten in accordance with the Company's
individual ordinary life underwriting rules and practices.
3. Amounts
For the purpose of this Agreement, the amount at risk will be
calculated as (a) the amount payable by the Company by reason of death of the
insured, less (b) the accumulation fund, less (c) the Company's retention.
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ARTICLE II - FACULTATIVE REINSURANCE
The Company may choose to submit for consideration by Life Re, a
request for any amount of reinsurance of the coverages in Article II that the
Company may require. Reinsurance may be requested for any amount without regard
for the limits of retention detailed in Schedule A, but the Company will notify
Life Re promptly of any changes in its limits of retention.
When the Company requests facultative reinsurance, the application will
be made by submitting to Life Re a mutually agreeable form. The Company will
send to Life Re any and all information the Company has about the risk,
including without limitation, copies of the application, medical examiners'
reports, attending physicians' statements, inspection reports, and other reports
and other papers bearing on the insurability of the risk. Promptly upon receipt
of the application, Life Re will analyze the risk and notify the Company of Life
Re's decision and Life Re's classification of the risk. If the Company elects to
accept Life Re's unconditional offer of acceptance for reinsurance of the risk,
the Company will notify Life Re within 120 days of Life Re's offer.
The liability of Life Re on any facultative reinsurance under this
Agreement begins and ends at the same time as that of the Company, provided
that:
(a) Life Re has given the Company an unconditional offer of
acceptance after the application for reinsurance, and
(b) the Company has notified Life Re of its acceptance of such
offer within 120 days of said offer.
ARTICLE III - PROCEDURES FOR REPORTING
1. General Information
Life Re will accept, on a self administered basis, reinsurance in
amounts per life up to the amounts set forth in Schedule A.
2. Self-Administered Reporting
The Company will remit a check for the balance indicated in the
quarterly statements to Life Re along with the reporting form set forth in
Schedule B or a mutually agreed upon form submitted by the Company. If a balance
is due the Company, it will be remitted by Life Re promptly. Within ten (10)
days following the close of each calendar quarter, the Company will forward to
Life Re on computer tape or other acceptable form, reports in substantial
conformity with the following:
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A. QUARTERLY NEW BUSINESS REPORT
(1) policy number (10) amount reinsured
(2) full name of insured (11) facultative indicator
(3) date of birth (12) state of residence
(4) sex (13) table rating
(5) issue age (14) flat extra (amount + number of years)
(6) policy date (15) death benefit option (UL products)
(7) underwriting (16) amount at risk classification
(8) plan of insurance (17) transaction code
(9) amount issued (18) currency if other than U.S.
(19) qualified pension (yes/no)
B. QUARTERLY CONVERSION REPORT
The Company will furnish Life Re with a separate listing of reinsurance
policies that are conversions or replacements to the plan(s) as stated in
Schedule A. The listing should provide the following information:
(1) 1 through 19 in 2.A above (4) attained age
(2) original policy date (5) duration
(3) original policy number (6) effective date if other than policy date
C. QUARTERLY PREMIUM REPORT
The Company will furnish Life Re a listing of all reinsurance policies
issued or renewing during the past quarter accompanied by the reinsurance
premiums for such policies. The listing should be segregated into first year
issues and renewals and should provide the following information:
(1) 1 through 19 in 2.A above
(2) current amount at risk
(3) The net reinsurance premium due for each reinsured policy with the
premium for life and each supplemental benefit separated.
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D. QUARTERLY CHANGE REPORT
The Company will report the details of all policy terminations and
changes on the reinsured policies. In addition to the data indicated in 2.A,
above, the report should provide information about the nature, the effective
date, and the financial result of the change with respect to reinsurance.
E. QUARTERLY POLICY EXHIBIT REPORT
The Company will provide a summary of new issues, terminations,
recaptures, changes, death claims and reinstatements during the quarter and the
inforce reinsurance at the end of the quarter.
F. QUARTERLY INFORCE AND RESERVE LISTING
Within ten (10) days after the close of each calendar quarter, the
Company will furnish Life Re with a listing of reinsurance in force by policy,
by year of issue and include statutory reserves for the same. The listing must
show sufficient detail such that reserve calculations can be independently
verified by Life Re's auditors and examiners. The listing should be segregated
into first year issues and renewals and should provide the following
information:
(1) 1 through 19 in 2.A above
For the fourth quarter, Federal Income Tax reserves must also be
furnished. They may be included in the fourth quarter statutory report or they
may be submitted separately, but in the same format as the statutory report.
G. ELECTRONIC DATA TRANSMISSION
If the Company reports its reinsurance transactions via electronic
media, the Company will consult with Life Re to determine the appropriate
reporting format. Should the Company subsequently desire to make changes in the
data format or the code structure, the Company will communicate such changes to
Life Re prior to the use of such changes in reports to Life Re.
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ARTICLE IV - PREMIUMS
1. Life Insurance
Premiums per $1,000 for Life Insurance rated standard and preferred are
given in Schedule C, multiplied by the percentages given in Schedule D. The
premiums per $1,000 are applied to the amount of life reinsurance as outlined in
Article I. A policy fee, when applicable, is charged in each year in addition to
the premium based on amount of life reinsurance. Life Re anticipates that these
premiums will be continued indefinitely for all business ceded under this
Agreement. For the purpose of satisfying requirements for deficiency reserves
imposed by various state insurance departments, Life Re will guaranty for
renewal the greater of the premiums provided in this Agreement or premiums based
on the 1980 CSO Table at 2.5% interest. When the Company charges a flat extra
premium, whether alone or in addition to a premium based on a multiple table,
the Company will pay this premium less the discounts detailed in Schedule D, on
the reinsurance amount in addition to the standard or multiple table premium for
the rating and plan of reinsurance.
2. Premium Taxes
Life Re will not reimburse the Company for state premium taxes on
reinsurance premiums received from the Company.
3. Payments
Premiums are payable annually in advance. If reinsurance is reduced,
terminated, increased or reinstated, during the year, pro-rata adjustment will
be made by Life Re and the Company on all premium items except policy fees.
4. Nonpayment of Reinsurance Premiums
The payment of reinsurance premiums is a condition precedent to the
liability of Life Re under this Agreement. If the Company does not pay premiums
to Life Re as provided in this Agreement and such amounts are more than 120 days
in arrears, Life Re will have the right to terminate the reinsurance under this
Agreement.
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5. Interest on Delinquent Payments
If the Company is more than 90 days in arrears in remitting premiums to
Life Re, such premiums will be considered delinquent and interest will be added
to the amount to be remitted. Interest will be calculated from (i) the time the
premiums are due Life Re to (ii) the date the Company pays the premium to Life
Re. The rate of interest charged on delinquent payments will be equal to the
rate listed in the Federal Reserve Statistical Release, as promulgated by the
Board of Governors of the Federal Reserve System, for the monthly average of
Corporate bonds, Xxxxx'x seasoned Aaa (the "Interest Rate").
6. Misstatements
If the insured's age or sex was misstated and the amount of insurance
on the Company's policies is adjusted, the Company and Life Re will share the
adjustment in proportion to the amount of liability of each at the time of issue
of the policies. Premiums will be recalculated for the correct age or sex and
amounts according to the proportion as above and adjusted without interest. If
the insured is still alive, the method above will be used for past years and the
amount of reinsurance and premium will be adjusted for the future to the amount
that would have been correct at issue.
ARTICLE V - CLAIMS
1. Notice
The Company will notify Life Re promptly after receipt of any information on a
claim where reinsurance is involved. The Company will furnish to Life Re as soon
as possible the completed reinsurance claim form and copies of all claim papers
and proofs. However, if the amount reinsured with Life Re is more than the
amount retained by the Company and the claim is contestable, all papers in
connection with such claim, including all underwriting and investigation papers
must be submitted to Life Re for its recommendation before admission of any
liability on the part of the Company.
2. Contested Claims
Whenever the Company has formed a preliminary opinion that a claim
might be denied or contested, and prior to any final action by the Company
indicating to the claimant that the claim is being denied or contested, the
Company will give Life Re the opportunity to review the complete claim file.
Life Re will review this file promptly and, at its option, (a) pay Life Re's
full share as if the claim was not contested, in full discharge of Life Re's
obligation to the Company for that claim,
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or (b) after consultation with the Company join in the contest, or ratify the
denial, in which case Life Re will communicate to the Company in writing Life
Re's decision to participate in the contest, or ratify the denial, with respect
to that claim.
3. Expenses
Life Re will share in the claim expense of any contest or compromise of
a claim in the same proportion that the amount at risk reinsured under this
Agreement bears to the total risk of the Company on all policies being contested
by the Company, and Life Re will share in the total amount of any reduction in
liability in the same proportion. Claim expense will include without limitation
the cost of investigation, legal fees, court costs, and interest charges.
Compensation of salaried officers and employees and any possible
extra-contractual damages will not be considered covered expenses. Life Re will
not be liable for expenses incurred in connection with a dispute or contest
arising out of conflicting claims of entitlement to policy proceeds or benefits.
4. Misstatements
In the event of an increase or reduction in the amount of the Company's
insurance on any policy reinsured hereunder because of an overstatement or
understatement of age or misstatement of sex, established after the death of the
insured, the Company and Life Re will share in such increase or reduction in
proportion to their respective amounts at risk under that policy.
5. Payment
For Life Insurance Life Re will pay its share in a lump sum to the
Company, without regard to the form of claim settlement of the Company.
6. Assistance and Advice
At the request of the Company, Life Re will advise the Company on any
claim concerning business reinsured under this Agreement and, when such a claim
appears to be of doubtful validity, Life Re will assist the Company in its
determination of liability and in the best procedure to follow with respect to
the claim.
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ARTICLE VI - REDUCTIONS, REINSTATEMENTS & CHANGES
1. Reductions and Terminations
Reinsurance amounts are calculated in terms of coverages on the life of
a person. If any of the Company's policies or riders on the person are reduced
or terminated, the reinsurance in force will be reduced by the corresponding
amount. The reduction will not be applied to force the Company to reassume more
than its regular retention limit at the time of the reduction for the age at
issue, mortality rating and form of the policy or policies for which reinsurance
is being terminated. The reduction first will be applied to reinsurance, if any,
on the particular policy reduced. If the reduction exceeds the amount of
reinsurance on that policy, the reduction will then be applied to reinsurance on
other policies on that life in the order in which the policies were effected,
i.e., the first effected will be the first terminated or reduced. If reinsurance
has been ceded to more than one reinsurer, the reduction in Life Re's
reinsurance will be in proportion to the reduction in the total. After the
proportion has been determined, the rules above will be used.
2. Reinstatements
A Reinsured policy ceded to Life Re that was reduced, terminated, or
lapsed, (a) will require approval by Life Re prior to reinstatement if the
Company has retained less than 50% of the risk, or (b) will be reinstated
automatically by Life Re if the Company has retained more that 50% of the risk
and reinstates the Reinsured Policy under its regular rules. Upon reinstatement,
reinsurance for the policy will be for the amount that would be in force had the
policy not been reduced, terminated, or lapsed.
In connection with all reinstatements the Company will pay Life Re all
reinsurance premiums and interest in like manner as the Company has received
under its policy.
3. Nonforfeiture Benefits
Life Re will not participate in nonforfeiture benefits.
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4. Contractual Conversions and Exchanges
In the event of a contractual conversion or exchange (i.e., conversion
or exchange that requires no evidence of insurability) Life Re will reinsure the
risk resulting from such conversion or exchange at the rates shown on Schedule C
on point-in-scale basis (using the original issue age and duration from the
original issue) and the discounts of Schedule D on a point-in-scale basis. The
reinsured amount at risk on the policy or policies being converted may not
exceed the current reinsured amount at risk on the policy or policies being
converted or exchanged. If the conversion or exchange results in an increase of
risk, the amount of increase will be subject to evidence of insurability.
5. Non Contractual Exchanges
Non contractual exchanges are subject to evidence of insurability.
Premiums for the risk resulting from the exchange will be reflected in Schedule
C.
6. Program of Internal Replacement
Should the Company, its affiliates, successors, or assigns, initiate a
program of internal replacement, as defined below, that would include any of the
risks reinsured hereunder, the Company will immediately notify the reinsurer.
For each risk reinsured hereunder that has been replaced under a program of
internal replacement, the reinsurer shall have the option, at its sole
discretion, of either treating the risks reinsured as recaptured, or continuing
reinsurance on the new policy under this Agreement. The term "program of
internal replacement" shall mean any program offered to a class of policy owners
in which a policy or any portion of a policy is exchanged for another policy,
not reinsured under this Agreement, which is written by the Company, its
affiliates, successors, or assigns.
ARTICLE VII - DAC TAX
Life Re and the Company hereby agree to the following pursuant to
Section 1.848-2(g)(8) of the Income Tax Regulation under Section 848 of the
Internal Revenue Code of 1986, as amended.
(a) The term "party" will refer to either Life Re or the Company
as appropriate.
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(b) The terms used in this Article are defined by reference to
Regulation 1.848-2. The term "net consideration" will refer to
either net consideration as defined in Regulation Section
1.848-2(f) or gross amount of premiums and other consideration
as defined in Regulation Section 1.848-3(b) as appropriate.
(c) Each party shall attach a schedule to its federal income tax
return which identifies the relevant reinsurance agreements
for which the joint election under the Regulation has been
made.
(d) The party with net positive consideration, as defined in the
Regulation promulgated under Code Section 848, for such
agreement for each taxable year, shall capitalize specified
policy acquisition expenses with respect to such agreement
without regard to the general deductions limitation of Section
848(c)(1).
(e) Each party agrees to exchange information pertaining to the
amount of net consideration under such agreement each year to
ensure consistency.
ARTICLE VIII - RECAPTURE
1. Standards for Recapture
If the Company increases its maximum retention from the maximum limit
of retention set forth in Schedule A, the Company may elect to recapture that
portion of each Reinsured Policy equal to the difference between the Company's
new limit of retention and the Company's old limit of retention, subject to the
provisions of this Article VIII. If the Company elects this type of recapture,
the Company may only recapture Reinsured Policies that meet both of the
following requirements: (a) Reinsured Policies that have been in force for 10
years and (b) Reinsured Policies for which the Company maintained its maximum
limit of retention at the time the Reinsured Policy was issued.
2. Method of Recapture
If the Company elects to recapture, the Company will notify Life Re in
writing within ninety days from the effective date of the increase in its limit
of retention. If the Company elects to recapture one Reinsured Policy under this
provision, the Company must recapture every Reinsured Policy that meets the
requirements set forth in Article VIII, Section 1, above.
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Recapture for each Reinsured Policy will occur on the later to occur of
(a) the next anniversary of the Reinsured Policy or (b) the 10 anniversary of
the Reinsured Policy. The amount of reinsurance on the Reinsured Policy will be
reduced so that the total amount of risk retained by the Company will be equal
to the Company's maximum limit of retention.
If two or more reinsurers have reinsurance on the same Reinsured
Policy, Life Re's portion of the reduction will be in proportion to Life Re's
share of the total reinsurance on the Reinsured Policy.
ARTICLE IX - INSOLVENCY
All reinsurance under this Agreement will be paid on demand by Life Re
directly to the Company, its liquidator, receiver, or statutory successor, on
the basis of the liability of the Company under the policy or policies reinsured
without diminution because of the insolvency of the Company. In the event of the
insolvency of the Company, the liquidator, receiver, or statutory successor of
the Company will give written notice to Life Re of a pending claim against Life
Re or the Company on any policy reinsured within a reasonable time after the
claim is filed in the conservation, liquidation, or insolvency proceedings.
While the claim is pending, Life Re may investigate and interpose, at its own
expense, in the proceedings where the claim is to be adjudicated, any defenses
which it may deem available to the Company or its liquidator, receiver, or
statutory successor. The expense incurred by Life Re will be charged, subject to
court approval, against the Company as an expense of the conservation,
liquidation, or insolvency to the extent of a proportionate share of the benefit
that accrues to the Company as a result of the defenses by Life Re. Where two or
more reinsurers are involved and a majority in interest elect to defend a claim,
the expense will be apportioned in accordance with the terms of this Agreement
as if the expense had been incurred by the Company.
ARTICLE X - ARBITRATION
Life Re and the Company intend that any dispute between them under or
with respect to this Agreement be resolved without resort to any litigation.
Accordingly, Life Re and the Company agree that they will negotiate diligently
and in good faith to agree on a mutually satisfactory resolution of any such
dispute; provided, however, that if any such dispute cannot be so resolved by
them within sixty calendar days (or such longer period as the parties may agree)
after commencing such negotiations, Life Re and the Company agree that they will
submit such dispute to arbitration in the manner specified in, and such
arbitration proceeding will be conducted in accordance with, the rules of the
American Arbitration Association.
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The arbitration hearing will be before a panel of three arbitrators,
each of whom must be a present or former officer of a life insurance or life
reinsurance company. Life Re and the Company will each appoint one arbitrator by
written notification to the other party within thirty calendar days after the
date of the mailing of the notification initiating the arbitration. These two
arbitrators will then select the third arbitrator within sixty calendar days
after the date of the mailing of the notification initiating arbitration.
If either Life Re or the Company fails to appoint an arbitrator, or
should the two arbitrators be unable to agree upon the choice of a third
arbitrator, the president of the American Arbitration Association or of its
successor organization or (if necessary) the president of any similar
organization designated by lot of Life Re and the Company within thirty calendar
days after the request will appoint the necessary arbitrators.
The vote or approval of a majority of the arbitrators will decide any
question considered by the arbitrators; provided, however, that if no two
arbitrators reach the same decision, then the average of the two closest
mathematical determinations will constitute the decision of all three
arbitrators. The place of arbitration will be Stamford, Connecticut. Each
decision (including without limitation each award) of the arbitrators will be
final and binding on all parties and will be nonappealable, and (at the request
of either Life Re or the Company) any award of the arbitrators may be confirmed
by a judgment entered by any court of competent jurisdiction. No such award or
judgment will bear interest. Each party will be responsible for paying (a) all
fees and expenses charged by its respective counsel, accountants, actuaries, and
other representatives in conjunction with such arbitration and (b) one-half of
the fees and expenses charged by each arbitrator.
ARTICLE XI - GENERAL PROVISIONS
1. Reinsurer's Right of Notice of Unusual Practices
In providing reinsurance facilities to the Company under this
Agreement, Life Re has granted the Company considerable authority with respect
to automatic binding power, reinstatements, claim settlements, and the general
administration of the reinsurance account. To facilitate transactions, Life Re
has required the minimum amount of information and documentation possible,
reflecting its utmost faith and confidence in the Company. Life Re assumes that,
except as otherwise notified by the Company, the underwriting, claims and other
insurance practices employed by the Company with respect to reinsurance ceded
under this Agreement are generally consistent with the customary and usual
practices of the
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insurance industry as a whole. If the Company changes or modifies its practices
or engages in exceptional or uncustomary practices, the Company agrees to make
those practices known to Life Re before assigning any liability to Life Re with
respect to any reinsurance issued under such practices.
2. Policy Forms and Rates
Upon request, the Company will furnish Life Re with a copy of its
application forms, policy and rider forms, premium and non-forfeiture value
manuals, reserve tables, actuarial memoranda, and any other forms or tables
needed for proper handling of reinsurance under this Agreement. Life Re must
agree in writing before incurring additional liability resulting from any
changes to policies, policy riders or amendments reinsured under this Agreement.
3. Reinsurance Conditions
The reinsurance is subject to the same limitations and conditions as
the insurance under the policy or policies written by the Company on which the
reinsurance is based.
4. Errors and Omissions
If either the Company or Life Re unintentionally fails to perform an
obligation that affects this Agreement and such failure results in an error on
the part of the Company or Life Re, the error will be corrected by restoring
both the Company and Life Re to the positions they would have occupied had no
such error occurred. For business reported but not covered under the provisions
of this Agreement, Life Re shall be obligated only for the return of premium
paid, plus interest as provided below.
Any amounts due under this Section 4 will bear interest at a rate
agreed upon by the Company and Life Re or at a rate equal to the Interest Rate
as described in Article IV.5.
5. Offset
Any amount which either the Company or Life Re is contractually
obligated to pay to the other party may be paid out of any amount which is due
and unpaid under this Agreement. The application of this offset provision will
not be deemed to constitute diminution in the event of insolvency.
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6. Inspection
Upon reasonable notice, Life Re may inspect any and all books, records,
documents or similar information relating to or affecting reinsurance under this
Agreement at the home office of the Company during normal business hours.
7. Entire Agreement
This Agreement and the Schedules attached hereto supersede all prior
discussions and written and oral agreements between the parties with respect to
the subject matter of this Agreement. This Agreement and the Schedules attached
hereto contain the sole and entire agreement between the parties hereto with
respect to the subject matter hereof.
8. Amendment
This Agreement may be modified or amended only by a writing duly
executed by or on behalf of the Company and Life Re.
9. Counterparts
This Agreement may be executed simultaneously in any number of
counterparts, each of which will be deemed an original, but all of which will
constitute one and the same instrument.
10. No Assignment
Except as otherwise provided herein, neither party hereto may assign
this Agreement or any right hereunder or part hereof without the prior written
consent of the other party hereto.
11. Binding Effect
This Agreement is binding upon and will inure to the benefit of the
parties and their respective successors and permitted assignees.
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12 Notices
Any notice, request, instruction, or other document to be given
hereunder by any party hereto to the other party hereto will be in writing and
(a) delivered personally, (b) sent by facsimile, (c) delivered by overnight
express, or (d) sent by registered or certified mail, postage prepaid, as
follows:
If to the Company, to:
Security Equity Life Insurance Company
00 Xxxxxxxx Xxxx Xxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: Reinsurance Manager
Facsimile: 000-000-0000
If to Life Re, to:
Life Reassurance Corporation of America
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Vice President, Administration
Facsimile: 203/321-3200
or at such other address for a party as will be specified by like notice. Each
notice or other communication required or permitted under this Agreement that is
addressed as provided in this Article XI will, if delivered personally or by
overnight express, be deemed given upon delivery; will, if delivered by
facsimile or similar facsimile transmission, be deemed delivered when
electronically confirmed; and will, if delivered by mail in the manner described
above, be deemed given on the third business day after the day it is deposited
in a regular depository of the United States Mail.
Please send all cash remittances to:
Life Reassurance Corporation of America
X.X. Xxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000
LIFE RE AGREEMENT #6272-1 15 Life Re Logo
ARTICLE XII - DURATION OF AGREEMENT
This Agreement will be effective on and after the effective date stated
in Article I. It is unlimited in duration but may be amended by mutual consent
of the Company and Life Re. This Agreement may be terminated as to new
reinsurance by either party giving 90 days' written notice to the other.
Termination as to new reinsurance does not affect existing reinsurance. Existing
reinsurance will remain in force until termination of the Company's policy or
policies on which the reinsurance is based in accordance with the terms of this
Agreement. Notwithstanding the foregoing, Life Re may terminate this Agreement
as to new and existing reinsurance in the event the Company does not pay
premiums to Life Re, as provided in Article IV.
LIFE RE AGREEMENT #6272-1 16 Life Re Logo
ARTICLE XIII - EXECUTION
IN WITNESS WHEREOF, Life Re and the Company have executed this
Agreement on the dates set forth below.
SECURITY EQUITY LIFE INSURANCE COMPANY
Date: 10/16/96 By: /s/ X. X. Xxxxxx
-------------------------
Place: Armonk, NY Title: President
Witness: /s/ Xxxxxx X. Xxxxx
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LIFE REASSURANCE CORPORATION OF AMERICA
Date: 8/16/96 By: /s/ Xxxxxxx Carratano
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Place: Stamford, CT Title: Vice President
Witness: /s/ Xxx Xxxx
--------------------------
LIFE RE AGREEMENT #6272-1 17 Life Re Logo
SCHEDULE A
RETENTION LIMITS
PLANS COVERED
AGREEMENT NUMBER 6272-1
RETENTION LIMITS
A. LIFE
All Ages, All Ratings $125,000
PLANS COVERED
The preceding schedules refer to insured lives whose surnames begin
with the letters A through Z under the following plans:
PLANS
Variable Universal Life
LIFE RE AGREEMENT #6272-1 Life Re Logo
SCHEDULE B
REPORTING FORM
LIFE RE AGREEMENT #6272-1 Life Re Logo
Life LIFE REASSURANCE CORPORATION OF AMERICA
Re Logo Self Administration/Bulk Reinsurance Summary Reporting Form
Ceding Company ______________ Reinsurer ________________________
Treaty/Account # ____________ Period Experience is for _________
Coin ___ YRT ___ Mod Co ___ Other ___ Interest Sensitive: Yes __ No __
Reinsurance Premium Mode: Monthly ___ Quarterly ___ Annual ___ In Advance ___
In Arrears ___
Reinsurance Reporting Mode: Monthly ___ Quarterly ___ Annual ___
Contact _____________ Date ___________________ Phone # _________________
SECTION I - ACCOUNTING
* * * Premiums * * * * * * Allowances * * *
--------------------------- ------------------------------
Other
First Year Renewal Year First Year Renewal Year Benefit Total
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Life
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ADB
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Waiver of Premium
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Other
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TOTAL
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SECTION II - RESERVE INFORMATION Amount of Check
Amount of Rein (000) Reserves Reinsured
-------------------- Issue ----------------------------------------------
Life ADB Year Life ADB Waiver Subst'd Deficiency
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SECTION III - POLICY EXHIBIT INFORMATION
Current Period Year to Date
------------------------------ -------------------------
No. of Amt. of * No. of Amt. of*
Policies Rein (000) Policies Rein (000)
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A. Inforce Beg. of Period A.
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1. New Business Auto 1. Auto
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Fac Fac
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2. Conversions/Replacements 2.
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3. Reinstatements 3.
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4. Other Increases 4.
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5. Not Takens 5.
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a) Total Inc (1+2+3+4-5) a.
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6. Death 6.
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7. Conversions/Replacements 7.
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8. Lapses 8.
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9. Surrenders 9.
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10. Expiry 10.
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11. Recapture 11.
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12. Other Decreases 12.
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b) Total Dec (6+7+8+9+10+11+12) b.
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B. Inforce End of Period (A + a - b) B.
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Form #TA1(4/91)
SCHEDULE C
PREMIUM RATES
LIFE RE AGREEMENT #6272-1 Life Re Logo
SECURITY EQUITY LIFE INSURANCE
MORTALITY RATES
VARIABLE UNIVERSAL LIFE
MALE NON-SMOKER
ISSUE AGE 20 - 85
SECURITY EQUITY LIFE INSURANCE
MORTALITY RATES
VARIABLE UNIVERSAL LIFE
FEMALE NON-SMOKER
ISSUE AGE 20 - 85
SECURITY EQUITY LIFE INSURANCE
MORTALITY RATES
VARIABLE UNIVERSAL LIFE
MALE SMOKER
ISSUE AGE 20 - 85
SECURITY EQUITY LIFE INSURANCE
MORTALITY RATES
VARIABLE UNIVERSAL LIFE
FEMALE SMOKER
ISSUE AGE 20 - 85
SCHEDULE D
PERCENTAGES AND DISCOUNTS
Agreement Number 6272-1
Reinsurance premiums are based on the rates shown in Schedule C, multiplied by
the following percentages:
PLAN
VARIABLE UNIVERSAL LIFE 103% All Years
The discounts granted for reinsurance amounts expressed as a percentage of the
premium rate charged by the Company are shown below for each applicable benefit:
BENEFIT FIRST YEAR RENEWAL YEARS
------- ---------- -------------
LIFE INSURANCE - FLAT EXTRA PREMIUMS
Aviation Hazards 10% 10%
Temporary Extras (< = 5 years) 10% 10%
Permanent Extras (> 5 years) 75% 10%
LIFE RE AGREEMENT #6272-1 Life Re Logo
DEFINITIONS
1. EXCESS REINSURANCE - A form of reinsurance under which recoveries are
available when a given loss exceeds the ceding company's retention
defined in the agreement. Also called excess of retention reinsurance.
2. FACULTATIVE REINSURANCE - Facultative reinsurance means reinsurance of
individual risks by offer and acceptance. The ceding company and the
reinsurer establish a "faculty" to accept or reject each risk offered.
3. FLAT EXTRA - Flat extra ratings are fixed dollar amounts assessed per
thousand of insurance issued and usually apply to applicants in
hazardous occupations, avocations, aviation or with certain physical
impairments. A flat extra rating can be charged for a temporary period
or on a permanent basis.
4. QUOTA SHARE - A form of reinsurance whereby the reinsurer accepts a
stated percentage of each and every risk within a defined category of
business on a pro rata basis.
5. RETENTION - The amount or portion of risk that the ceding company
retains for its own account.
6. YEARLY RENEWABLE TERM (YRT) - A form of reinsurance in which the
reinsurer assumes, for a premium that varies each year, the risks
associated with the mortality of the underlying life insurance
policyholders, but not the risks associated with the policy cash
values. The premium for the reinsurance varies with the age, sex and
policy duration.
LIFE RE AGREEMENT #6272-1 Life Re Logo
SELIC/LIFE REASSURANCE REINSURANCE AGREEMENT
#9387148
