**EXHIBIT 10.2**

 

NEW YORK INSURER SUPPLEMENT

 

TO

 

AMENDED AND RESTATED SERVICE AND EXPENSE AGREEMENT

 

WHEREAS,ALLSTATE INSURANCE COMPANY, an Illinois insurance company (“Allstate”), THEALLSTATE CORPORATION, a Delaware corporation (“Allcorp”), ALLSTATE LIFE INSURANCECOMPANY OF NEW YORK, a New York insurance corporation (“ALNY”) and INTRAMERICALIFE INSURANCE COMPANY (“Intramerica”) and, together with ALNY, the “New YorkInsurers”) are parties to an Amended and Restated Service and Expense Agreement(the “Agreement”), together with certain other insurance company affiliates ofAllstate (collectively, the “Affiliates”); and

 

WHEREAS,Allstate, Allcorp and the New York Insurers wish to supplement and amend theAgreement, solely as to services and facilities provided to the New YorkInsurers thereunder, in order to conform to requirements and restrictions ofthe New York Insurance Law that are applicable to the New York Insurers and notto the other Affiliates.

 

NOW,THEREFORE, Allstate, Allcorp and the New York Insurers do hereby agree asfollows:

 

1.                                       ThisNew York Supplement shall apply only to those services and facilities providedto each of the New York Insurers and shall not alter or amend the Agreement asrespects those provided to or by any other Affiliates thereunder. To the extentthat the provisions of this New York Supplement are inconsistent with those ofthe Agreement, the terms of the New York Supplement shall govern.

 

2.                                       Asrespects the New York Insurers, both the Agreement and this New York Insurer Supplementshall take effect as of March 5, 2005.

 

3.                                       Forthe purpose of this New York Supplement, the Providing Parties are AmericanHeritage Service Company, a licensed independent adjuster, for claimsadjustment services relating to accident and health insurance provided on apayroll deduction basis and Allstate for all other services.

 

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4.                                       Thesecond paragraph of Section 1 of the Agreement is amended to add thefollowing:

 

[Premiums]

 

After the required processing of premium payments,Providing Parties will immediately deposit such premiums in one or more bankaccounts established in the name of ALNY or Intramerica, as the case may be,and subject to the control of officers of the New York Insurers.

 

[Toll Free Number]

 

Providing Parties will establish and maintain one ormore toll free telephone numbers for use by policyholders, insureds,beneficiaries and applicants of each of the New York Insurers.

 

[Claims Processing]

 

Final claims decisions will be based upon guidelinesand procedures established and approved by the New York Insurers from time totime and communicated in writing to Providing Parties. The New York Insurersretain final approval authority on all claim payments. Payment of claims shallbe made using checks of the New York Insurers.

 

5.                                       Thethird paragraph of Section 1 of the Agreement is amended to add thefollowing:

 

[Safeguarding Customer Information]

 

Providing Parties shall implement and maintainappropriate measures designed to meet the objectives of New York InsuranceDepartment Regulation No. 173 with respect to safeguarding customerinformation and customer information systems of the New York Insurers. Allstateshall adjust its information security program at the request of the New YorkInsurers for any relevant changes dictated by their assessment of risk relatingto their customer information and customer information systems. Confirmingevidence that Allstate has satisfied the obligations hereunder shall be madeavailable, during normal business hours, for inspection by the New YorkInsurers, anyone authorized by them and any governmental agency that hasregulatory authority over their business activities.

 

6.                                       Thefourth paragraph of Section 1 of the Agreement is amended to add thefollowing after the second sentence thereof;

 

The New York Insurers shall retain all finalunderwriting authority.

 

7.                                       Section 6of the Agreement is amended to add the following new paragraph:

 

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Within fifteen (15) days after the end of eachcalendar month, Allstate shall submit to the New York Insurers a writtenstatement of the charges due from the New York Insurers to Allstate pursuant tothis Agreement in that calendar month, including charges not included in anyprevious statements. Any balance payableor to be refunded as shown in such statement shall be paid or refunded withinfifteen (15) days following receipt of such written statement by the New YorkInsurers. The New York Insurers may requesta written statement from Allstate setting forth, in reasonable detail, thenature of the services rendered or expense incurred and other relevantinformation to support the charge.

 

8.                                       Section 7of the Agreement is amended by adding the following provisions:

 

[Accounting Services]

 

All records of the New York Insurers shall bemaintained in accordance with New York Insurance Department Regulation No. 152(11 NYCRR 243). Notwithstanding any other provision of this Section 7,the books of account of the New York Insurer shall be kept at their principaloffice(s) in the State of New York. Backup of the records constituting thebooks of account of the New York Insurers shall be maintained, whether as hardcopy or another “durable medium” as defined in New York Insurance DepartmentRegulation No. 152. Such backup, together with the means to access anyrecords maintained as any “durable medium” shall be forwarded to the New YorkInsurers on a monthly basis and shall be maintained at the principal office(s)of the New York Insurers in the State of New York.

 

[Ownership and Custody of Records]

 

All records, books, and files established andmaintained by Providing Parties by reason of performance of services under thisAgreement, which absent this Agreement would have been held by the New YorkInsurers,****shall be deemed the property of the NewYork Insurers and shall be maintained inaccordance with applicable law and regulation, including, but not limited to,Regulation No. 152. Such records should be available, during normalbusiness hours, for inspection by the service recipient, anyone authorized bythe service recipient, and any governmental agency that has regulatoryauthority over the New York Insurers’business activities. Copies of such records, books and files shall be deliveredto the New York Insurers on demand. Allsuch records, books and files shall be promptly transferred to the NewYork Insurers by Providing Parties upontermination of this Agreement.

 

[Audits]

 

The Company and persons authorized by it or anygovernmental agency having jurisdiction over the New York Insurers shall have the right, at the ProvidingParties’ expense, to conduct an audit of the relevant books, records andaccounts of Providing Parties upon giving reasonable notice of its intent toconduct such an

 

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audit. In the event of such audit, Providing Partiesshall give to the party requesting the audit reasonable cooperation and accessto all books, records and accounts necessary to audit during normal businesshours.

 

9.                                       Section 8of the Agreement is amended to add the following provisions:

 

[Maintenance of Books]

 

The Providing Parties and the Service Recipient eachshall maintain its own books, accounts and records in such a way as to discloseclearly and accurately the nature and detail of the transactions between themincluding such accounting information as is necessary to support thereasonableness of charges under this agreement, and such additional informationas the company may reasonably request for purposes of its internal bookkeepingand accounting operations. Providing Parties shall keep such books, records andaccounts insofar as they pertain to the computation of charges hereunderavailable for audit, inspection and copying by the New York Insurers andpersons authorized by it or any governmental agency having jurisdiction overthe New York Insurers during allreasonable business hours.

 

10.                                 Section 11of the Agreement is amended to add the following provisions:

 

This Agreement shall remain in effect until terminatedby either its Providing Parties or the New York Insurers upon giving thirty(30) days or more advance written notice, provided that the New York Insurersshall have the right to elect to continue to receive data processing servicesand/or to continue to utilize data processing facilities and related softwarefor up to 180 days from the date of such notice. Subject to the terms(including any limitations or restrictions) of any applicable software orhardware licensing agreement then in effect between Providing Parties andlicensors, Providing Parties shall, upon termination of this Agreement, grantthe New York Insurers a perpetual license, without payment of any fee, in anyelectronic data processing software developed or used by Providing Parties inconnection with the services provided to the New York Insurers hereunder ifsuch software is not commercially available and is necessary, in the New YorkInsurers’ reasonable judgement, for the New York Insurers to perform subsequentto termination the functions provided by Providing Parties hereunder. Upontermination, Providing Parties shall promptly deliver to the New York Insurersall books and records that are, or are deemed by this Agreement to be, theproperty of the New York Insurers.

 

11.                                 [GoverningLaw]

 

As respects services and facilities provided to theNew York Insurers, the Agreement and this New York Insurer Supplement shall begoverned by, interpreted under and the rights of the parties determined inaccordance with the laws of the State of New York.

 

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INWITNESS WHEREOF, the parties hereto have caused this Supplement No. 1 tobe signed as of the date and year set forth above.

 

 
|   | THE ALLSTATE  CORPORATION        |
|--------|----------------------------------|
|   |                             |
|   |                             |   |
|   | By:                              |   /s/ Samuel H. Pilch |   |
|   |                             |   |   |
|   | Name:                            |  Samuel H. Pilch |   |
|   |                             |   |   |
|   | Title:                           |  Controller |   |
|   |                             |   |   |
|   | Date:                            |  April 19, 2005 |   |
|   |                             |   |
|   |                             |   |
|   | ALLSTATE  INSURANCE COMPANY      |
|   |                             |
|   |                             |   |
|   | By:                              |   /s/ Samuel H. Pilch |   |
|   |                             |   |   |
|   | Name:                            |  Samuel H. Pilch |   |
|   |                             |   |   |
|   | Title:                           |  Group Vice President and Controller |   |
|   |                             |   |   |
|   | Date:                            |  April 19, 2005 |   |
|   |                             |   |
|   |                             |   |
|   | ALLSTATE LIFE  INSURANCE COMPANY |
|   | OF NEW YORK                      |
|   |                             |   |
|   |                             |   |
|   | By:                              | /s/ Samuel H. Pilch |   |
|   |                             |   |   |
|   | Name:                            |  Samuel H. Pilch |   |
|   |                             |   |   |
|   | Title:                           |  Group Vice President and Controller |   |
|   |                             |   |   |
|   | Date:                            |  April 19, 2005 |   |
|        |                                  |  |  |  |

 

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|   | INTRAMERICA LIFE  INSURANCE COMPANY |
|--------|-------------------------------------|
|   |                                |   |
|   |                                |   |
|   | By:                                 | /s/ Samuel H. Pilch |   |
|   |                                |   |   |
|   | Name:                               |  Samuel H. Pilch |   |
|   |                                |   |   |
|   | Title:                              |  Group Vice President and Controller |   |
|   |                                |   |   |
|   | Date:                               |  April 19, 2005 |   |
|        |                                     |  |  |  |

 

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