Document:

Form of Property Catastrophe Excess

 Exhibit 10.1 
  
 PROPERTY CATASTROPHE 
 EXCESS OF LOSS
REINSURANCE AGREEMENT 
  
 UNITED PROPERTY AND CASUALTY INSURANCE
COMPANY 
 St. Petersburg, Florida 
  
 EFFECTIVE:      June 1, 2009 
 EXPIRATION:  June 1, 2010 
  
  
  
  
 

 

 PROPERTY CATASTROPHE EXCESS OF LOSS REINSURANCE AGREEMENT 
 TABLE OF CONTENTS 

							
	ARTICLE	 		 	DESCRIPTION	  	PAGE
				
	1	 		 	 Business Covered
	  	1
				
	2	 		 	 Retention and Limit
	  	1
				
	3	 		 	 Term
	  	2
				
	4	 		 	 Territory
	  	2
				
	5	 		 	 Exclusions
	  	2
				
	6	 		 	 Definitions
	  	4
				
	7	 		 	 Net Retained Lines
	  	6
				
	8	 		 	 Other Reinsurance
	  	7
				
	9	 		 	 Premium
	  	7
				
	10	 		 	 Reinstatement
	  	8
				
	11	 		 	 Notice of Loss and Loss Settlements
	  	8
				
	12	 		 	 Salvage and Subrogation
	  	8
				
	13	 		 	 Offset
	  	8
				
	14	 		 	 Unauthorized Reinsurance
	  	8
				
	15	 		 	 Taxes
	  	10
				
	16	 		 	 Currency
	  	10
				
	17	 		 	 Delay, Omission or Error
	  	10
				
	18	 		 	 Access to Records
	  	10
				
	19	 		 	 Arbitration
	  	10
				
	20	 		 	 Service of Suit
	  	11
				
	21	 		 	 Insolvency
	  	12
				
	22	 		 	 Third Party Rights
	  	12
				
	23	 		 	 Severability
	  	13
				
	24	 		 	 Confidentiality
	  	13
				
	25	 		 	 Entire Agreement
	  	13
				
	26	 		 	 Law and Jurisdiction
	  	13
				
	27	 		 	 Intermediary
	  	13
				
	28	 		 	 Mode of Execution
	  	14

     Attachments: 
     Schedule A – First Property Catastrophe Excess of Loss Reinsurance 
     Schedule B – Second Property Catastrophe Excess of Loss Reinsurance 
     Schedule C – Third Property Catastrophe Excess of Loss Reinsurance 
     Schedule D – Fourth Property Catastrophe Excess of Loss Reinsurance 
     Nuclear Incident Exclusion Clause - Physical Damage - Reinsurance - USA 
     Terrorism Exclusion Clause 
  

  
  
  

					
	     A9CFHB008_4129088
	  		  	

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 PROPERTY CATASTROPHE 
 EXCESS OF LOSS REINSURANCE AGREEMENT 
 (hereinafter referred to as the “Agreement”)

 between 
 UNITED PROPERTY
AND CASUALTY INSURANCE COMPANY 
 St. Petersburg, Florida 
 (hereinafter referred to as the “Company”) 
 and 
 the Subscribing Reinsurer(s) executing the 
 attached Interests and Liabilities Contract 
 (hereinafter referred to as the “Reinsurer”) 
 ARTICLE 1 — BUSINESS COVERED 
 This Agreement is to indemnify the Company in respect of its net excess liability as a result of any loss or losses which
may occur during the term of this Agreement under any policies, contracts and binders of insurance or reinsurance (hereinafter called “Policies”) in force at the effective date hereof or issued or renewed on or after that date, covering
business classified by the Company as Property and written in the State of Florida. Such business shall include but not be limited to Homeowners, Condominium Owners, and business written under the Company’s Garage Program. 
 ARTICLE 2 — RETENTION AND LIMIT 
 The Reinsurer will be liable in respect of each and every Loss Occurrence, for the Ultimate Net Loss over and above an
initial Ultimate Net Loss for that excess layer as shown in the Schedules attached hereto, each and every Loss Occurrence, subject to a limit shown as for that excess layer as shown in the Schedules attached hereto, each and every Loss Occurrence.

 The Florida Hurricane Catastrophe Fund (FHCF) limit provided pursuant to Section 215.555 (4)(c)(1).,
Florida Statutes (commonly referred to as the “Mandatory Layer,” which is currently estimated to be $289,563,580 excess of $121,776,870, and the FHCF limit provided pursuant to Section 215.555 (17), Florida Statutes (and defined
therein as the “Temporary Increase in Coverage Limit Option,” which is currently estimated to be $67,438,388 excess of $443,514,180), shall be deemed to inure to the benefit of this Contract whether collectible or not and shall be deemed
to be paid to the Company in accordance with the FHCF reimbursement contract at the Projected Payout Multiple set forth therein as of the date hereof (calculated based on a claims paying capacity of the FHCF of $27,175,000,000 and will be deemed not
to be reduced by any subsequent recalculation of the Projected Payout Multiple or the final Payout Multiple due to any reduction or exhaustion of the FHCF’s claims-paying capacity as respects either the Mandatory Layer or the Temporary Increase
in Coverage Limit Option. 
  

  
  
  

					
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 ARTICLE 3 — TERM 
 This Agreement shall become effective at 12:01 a.m., Local Standard Time at the location where the Loss Occurrence commences, June 1,
2009, with respect to losses arising out of Loss Occurrences commencing at or after that time and date, and shall remain in full force and effect until 12:01 a.m. Local Standard Time at the location where the Loss Occurrence commences, June 1,
2010. 
 The Company may terminate or reduce a subscribing reinsurer’s percentage share in this Agreement at any time by
giving prior written notice to the subscribing reinsurer by certified mail in the event of any of the following: 
  

	 	1)	 The subscribing reinsurer’s policyholders’ surplus falls by 20% or more; or 

  

	 	2)	 A State Insurance Department or other legal authority orders the subscribing reinsurer to cease writing business; or 

  

	 	3)	 The subscribing reinsurer has become insolvent or has been placed into liquidation or receivership (whether voluntary or involuntary), or there has been
instituted against it proceedings for the appointment of a receiver, liquidator, rehabilitator, conservator, or trustee in bankruptcy, or other agent known by whatever name, to take possession of its assets or control of its operation; or

  

	 	4)	 The subscribing reinsurer has become merged with, acquired or controlled by any company, corporation, or individual(s) not controlling the subscribing
reinsurer’s operations previously; or 

  

	 	5)	 The subscribing reinsurer ceases assuming new and renewal property treaty reinsurance business; or 

  

	 	6)	 The subscribing reinsurer’s A.M. Best or Standard and Poor’s rating is downgraded below A-. 

 In the event the Company terminates or reduces a subscribing reinsurer’s percentage share in accordance with this paragraph, the
termination or reduction will be effective for losses occurring on or after the date of the written notice to the subscribing reinsurer, and the premium due to the subscribing reinsurer for any reduced percentage share for the Agreement Year will be
reduced on a pro rata basis for the portion of the Agreement Year which is unexpired as of that date. Any return premium owed by the subscribing reinsurer in accordance with such a termination or reduction shall be payable as promptly as possible,
but no later than 30 days following the effective date of reduction or termination. If a loss has been paid under this Agreement or a subscribing reinsurer’s share is terminated after November 30, 2009, then no such return premium shall be
made. 
 Should this Agreement expire while a loss covered hereunder is in progress, the Reinsurer shall be responsible for
the loss in progress in the same manner and to the same extent it would have been responsible had the Agreement expired the day following the conclusion of the loss in progress. 
 ARTICLE 4 — TERRITORY 
 This Agreement shall follow the territorial limits of the Company’s original Policies. 
 ARTICLE 5 — EXCLUSIONS 
 This Agreement does not apply to and specifically excludes the
following: 
  

	 	A.	 Reinsurance assumed except as respects the following; Reinsurance assumed as a result of the depopulation of the Citizens Property and Casualty Insurance Company
and any successor 

  

  
  
  

					
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organisation of this entity and/or any reinsurance assumed from Private Carriers as a result of depopulations. 

  

	 	B.	 Financial guarantee and/or insolvency business. 

  

	 	C.	 Third party liability and medical payments business. 

  

	 	D.	 Liability as a member, subscriber or reinsurer of any Pool, Syndicate or Association; and any combination of insurers or reinsurers formed for the purpose of
covering specific perils, specific classes of business or for the purpose of insuring risks located in specific geographical areas and any assessments from Citizens Property and Casualty Insurance Company and any successor organisation of this
entity. 

  

	 	E.	 All liability of the Company arising by contract, operation of law, or otherwise, from its participation or membership, whether voluntary or involuntary, in any
insolvency fund. “Insolvency Fund” includes any guaranty fund, insolvency fund, plan, pool, association, fund or other arrangement, however denominated, established or governed, which provides for any assessment of or payment or assumption
by the Company of part or all of any claim, debt, charge, fee or other obligation of an insurer, or its successors or assigns, which has been declared by any competent authority to be insolvent, or which is otherwise deemed unable to meet any claim,
debt, charge, fee or other obligation in whole or in part. 

  

	 	F.	 Loss or liability from any Pool, Association or Syndicate and any assessment or similar demand for payment related to the Florida Hurricane Catastrophe Fund.

  

	 	G.	 All Accident and Health, Fidelity, Surety, Boiler and Machinery, Workers’ Compensation and Credit business. 

  

	 	H.	 All Ocean Marine business. 

  

	 	I.	 Flood and/or earthquake when written as such. 

  

	 	J.	 Difference in Conditions insurances and similar kinds of insurances, however styled, insofar as they may provide coverage for losses from the following causes:

  

	 	1)	 Flood, surface water, waves, tidal water or tidal waves, overflow of streams or other bodies of water or spray from any of the foregoing, all whether wind-driven
or not, except when covering property in transit; or 

  

	 	2)	 Earthquake, landslide, subsidence or other earth movement or volcanic eruption, except when covering property in transit. 

  

	 	K.	 Mortgage Impairment insurances and similar kinds of insurances, however styled. 

  

	 	L.	 All Automobile Business. 

  

	 	M.	 Loss or damage directly or indirectly occasioned by, happening through or in consequences of war, invasion, acts of foreign enemies, hostilities (whether war be
declared or not), civil war, rebellion, revolution, insurrection, military or usurped power, or 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. 

  

	 	N.	 Loss and/or Damage and/or Costs and/or Expenses arising from seepage and/or pollution and/or contamination, other than contamination from smoke. Nevertheless,
this exclusion does not preclude any payment of the cost of removal of debris of property damaged by a loss otherwise covered hereunder, subject always to a limit of 25% of the Company’s property loss under the applicable original Policy.

  

  
  
  

					
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	 	O.	 Nuclear risks as defined in the “Nuclear Incident Exclusion Clause - Physical Damage Reinsurance” attached to and forming part of this Agreement.

  

	 	P.	 All liability arising out of mold, spores and/or fungus but this exclusion shall not apply to those losses which follow as a direct result of a loss caused by a
peril otherwise covered hereunder. 

  

	 	Q.	 Terrorism, in accordance with NMA2930c, attached hereto. 

 ARTICLE 6 — DEFINITIONS 
  

	 	A.	 The term “Loss Occurrence” shall mean the sum of all individual losses directly occasioned by any one disaster, accident or loss or series of
disasters, accidents or losses arising out of one event which occurs within the area of one state of the United States or province of Canada and states or provinces contiguous thereto and to one another. However, the duration and extent of any one
Loss Occurrence shall be limited to all individual losses sustained by the Company occurring during any period of 168 consecutive hours arising out of and directly occasioned by the same event except that the term Loss Occurrence shall be further
defined as follows: 

  

	 	(i)	 As regards windstorm, hail, tornado, hurricane, cyclone, including ensuing collapse and water damage, all individual losses sustained by the Company occurring
during any period of 96 consecutive hours arising out of and directly occasioned by the same event. However, the event need not be limited to one state or province or states or provinces contiguous thereto. 

  

	 	(ii)	 As regards riot, riot attending a strike, civil commotion, vandalism and malicious mischief, all individual losses sustained by the Company occurring during any
period of 72 consecutive hours within the area of one municipality or county and the municipalities or counties contiguous thereto arising out of and directly occasioned by the same event. The maximum duration of 72 consecutive hours may be extended
in respect of individual losses which occur beyond such 72 consecutive hours during the continued occupation of an insured’s premises by strikers, provided such occupation commenced during the aforesaid period. 

  

	 	(iii)	 As regards earthquake (the epicenter of which need not necessarily be within the territorial confines referred to in the opening paragraph of this Article) and
fire following directly occasioned by the earthquake, only those individual fire losses which commence during the period of 168 consecutive hours may be included in the Company’s Loss Occurrence. 

  

	 	(iv)	 As regards freeze, only individual losses directly occasioned by collapse, breakage of glass and water damage (caused by bursting of frozen pipes and tanks) may
be included in the Company’s Loss Occurrence. 

 For all Loss Occurrences, other than (ii) above,
the Company may choose the date and time when any such period of consecutive hours commences provided that it is not earlier than the date and time of the occurrence of the first recorded individual loss sustained by the Company arising out of that
disaster, accident or loss and provided that only one such period of 168 consecutive hours shall apply with respect to one event, except for any “Loss Occurrence” referred to in sub-paragraph (i) above where only one such period of 96
consecutive hours shall apply with respect to one event, regardless of the duration of the event. 
 As respects those Loss
Occurrences referred to in (ii) above, if the disaster, accident or loss occasioned by the event is of greater duration than 72 consecutive hours, then the Company may 

  

  
  
  

					
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divide that disaster, accident or loss into two or more Loss Occurrences provided no two periods overlap and no individual loss is included in more than one
such period and provided that no period commences earlier than the date and time of the occurrence of the first recorded individual loss sustained by the Company arising out of that disaster, accident or loss. 
 No individual losses occasioned by an event that would be covered by the 72 hours clause, may be included in any loss occurrence claimed
under the 96 hours clause, nor may individual losses occasioned by an event that would be covered by either the 72 or 96 hours clauses, be included in any “Loss Occurrence” claimed under the 168 hours provision. 
 Losses directly or indirectly occasioned by: 
  

	 	(i)	 loss of, alteration of, or damage to 

 or 
  

	 	(ii)	 a reduction in the functionality, availability or operation of 

 a computer system, hardware, programme, software, data, information repository, microchip, integrated circuit or similar device in computer equipment or non-computer equipment, whether the
property of the policyholder of the Company or not, do not in and of themselves constitute an event unless arising out of one or more of the following perils: 
 fire, lightning, explosion, aircraft or vehicle impact, falling objects, windstorm, hail, tornado, cyclone, hurricane, earthquake, volcano, tsunami, flood, freeze or weight of snow. 

Any date change, including leap year calculations, shall not in and of itself be regarded as a loss occurrence for the purposes of
this Agreement. 
  

	 	B.	 The term “Ultimate Net Loss” as used herein is defined as the sum or sums (including 90% of any Extra Contractual Obligations and/or 90% of any Loss In
Excess of Policy Limits, and any Loss Adjustment Expenses as hereinafter defined, provided there is an indemnity loss hereunder, any Loss Adjustment Expense/fair rental value unrecoverable from the FHCF) paid or payable by the Company in settlement
of claims and in satisfaction of judgments rendered on account of such claims, after deduction of all salvage, all recoveries and all claims on inuring insurance or reinsurance, whether collectible or not. Nothing herein shall be construed to mean
that losses under this Agreement are not recoverable until the Company’s Ultimate Net Loss has been ascertained. 

  

	 	C.	 The terms “Loss In Excess of Policy Limits” and “Extra Contractual Obligations” as used herein shall be defined as follows:

  

	 	1.	 “Loss In Excess of Policy Limits” shall mean any amount paid or payable by the Company in excess of its Policy limits, but otherwise within the terms
of its Policy, as a result of an action against it by its insured or its insured’s assignee to recover damages the insured is legally obligated to pay because of the Company’s alleged or actual negligence or bad faith in rejecting a
settlement within Policy limits, or in discharging its duty to defend or prepare the defense in the trial of an action against its insured, or in discharging its duty to prepare or prosecute an appeal consequent upon such an action.

  

	 	2.	 “Extra Contractual Obligations” shall mean any punitive, exemplary, compensatory or consequential damages, other than Loss In Excess of Policy Limits,
paid or payable by the Company as a result of an action against it by its insured or its insured’s assignee, which     

  

  
  
  

					
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action alleges negligence or bad faith on the part of the Company in handling a claim under a policy subject to this Agreement. 

An Extra Contractual Obligation shall be deemed, in all circumstances, to have occurred on the same date as the loss covered or
alleged to be covered under the Policy 
 Notwithstanding anything stated herein, this Agreement shall not apply to any Loss
In Excess of Policy Limits or any Extra Contractual Obligation incurred by the Company as a result of any fraudulent and/or criminal act by any officer or director of the Company acting individually or collectively or in collusion with any
individual or corporation or any other organization or party involved in the presentation, defense, settlement of any claim covered hereunder. 
 Savings Clause (Applicable only if the Reinsurer is domiciled in the State of New York): In no event shall coverage be provided to the extent that such coverage is not permitted under New York law. 
  

	 	D.	 The term “Loss Adjustment Expense” as used herein shall mean expenses assignable to the investigation, appraisal, adjustment, settlement, litigation,
defense and/or appeal of claims, regardless of how such expenses are classified for statutory reporting purposes. Loss Adjustment Expense shall include, but not be limited to, Loss Adjustment Expense not recoverable from the FHCF, interest on
judgments, expenses of outside adjusters, and a pro rata share of the salaries and expenses of the Company’s field employees according to the time occupied adjusting such losses, but excluding salaries of the Company’s officials and any
normal overhead charges, and excluding Declaratory Judgment Expenses or other legal expenses and costs incurred in connection with coverage questions and legal actions connected thereto. 

  

	 	E.	 The term “Declaratory Judgment Expense” as used herein shall mean the Company’s own costs and legal expense incurred in direct connection with
declaratory judgment actions brought to determine the Company’s defense and/or indemnification obligations that are assignable to specific claims arising out of policies reinsured by this Agreement, regardless of whether the declaratory
judgment action is considered successful or unsuccessful. Any Declaratory Judgment Expense will be deemed to have been incurred by the Company on the date of the original loss, if any, giving rise to the declaratory judgment action.

  

	 	F.	 The term “Agreement Year” as used herein shall be defined as the period from 12:01 a.m., Local Standard Time at the location where the Loss Occurrence
commences, June 1, 2009, until 12:01 a.m., Local Standard Time at the location where the Loss Occurrence commences, June 1, 2010. However, if this Agreement is terminated, Agreement Year as used herein shall mean the period from 12:01
a.m., Local Standard Time at the location where the Loss Occurrence commences, June 1, 2009 through the effective date of termination. 

 ARTICLE 7 — NET RETAINED LINES 
 This Agreement applies
only to that portion of any insurances or reinsurances covered by this Agreement which the Company retains net for its own account (prior to deduction of any underlying reinsurance), and in calculating the amount of any loss hereunder and also in
computing the amount or amounts in excess of which this Agreement attaches, only loss or losses in respect of that portion of any insurances or reinsurances which the Company retains net for its own account shall be included. 
  

  
  
  

					
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 It is understood and agreed that the amount of the Reinsurer’s liability hereunder
in respect of any loss or losses shall not be increased by reason of the inability of the Company to collect from any other reinsurers, whether specific or general, any amounts which may have become due from them, whether such inability arises from
the insolvency of such other reinsurers or otherwise. 
 ARTICLE 8 — OTHER REINSURANCE 
 The Company shall be permitted to carry other reinsurance, recoveries under which shall inure solely to the benefit of the Company and be
entirely disregarded in applying all of the provisions of this Agreement. 
 ARTICLE 9 — PREMIUM 
  

	 	A.	 As premium for each excess layer of reinsurance coverage provided by this Agreement, the Company shall pay the Reinsurer the greater of the following:

  

	 	1.	 The amount, shown as “Minimum Premium” for that excess layer in the Schedules attached hereto; or 

  

	 	2.	 The percentage, shown as “provisional rate” for that excess layer in the Schedules attached hereto to the Company’s Total Insurance Values
in-force for Coverages A, B, C and D in respect of the Company’s Homeowners/Dwelling/Condominium Business as at September 30, 2009. 

  

	 	B.	 The Company shall pay the Reinsurer a deposit premium for each excess layer of the amount, shown as “Deposit Premium” for that excess layer in the
Schedules attached hereto, which is payable in four installments. The first three installments shall be an amount equal to 25% of “Deposit Premium” for that excess layer at July 1, 2009, October 1, 2009, and January 1,
2010. The fourth installment for each excess layer shall be equal to the adjusted deposit premium for that excess layer, computed in accordance with paragraph C below and is due on April 1, 2010. However, in the event this Agreement is
terminated, there shall be no deposit premium installments due after the effective date of termination. 

  

	 	C.	 “Adjusted deposit premium” as used herein shall mean: 

  

	 	1.	 The premium due hereunder for each excess layer, computed in accordance with paragraph A above; less 

  

	 	2.	 The first, second and third installments paid for each excess layer in accordance with paragraph B above. 

  

	 	D.	 No later than April 1, 2010 (or the date of termination in the event this Agreement is terminated prior to April 1, 2010), the Company shall provide a
report to the Reinsurer setting forth the premium due hereunder for each excess layer, computed in accordance with paragraph A above, and the adjusted deposit premium for each excess layer, computed in accordance with paragraph C above. In the event
this Agreement is terminated prior to April 1, 2010, any additional premium due the Reinsurer or return premium due the Company shall be remitted promptly. Should the Total Insurance Values in-force for Coverages A, B, C and D in respect of the
Company’s Homeowners/Dwelling/Condominium Business as at September 30, 2009 increase less than 10% of $39,493,781,760, there will be no additional premium due the Reinsurer. 

  

  
  
  

					
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 ARTICLE 10 — REINSTATEMENT 
 Loss payments under this Agreement will reduce the limit of coverage afforded by the amounts paid, but the limit of coverage will be
reinstated from the time of the occurrence of the loss. 
 Nevertheless, the Reinsurer’s liability for each excess layer
shall not exceed the amount shown in the Schedules attached hereto, as respects loss or losses arising out of one occurrence. 
 ARTICLE 11 — NOTICE OF LOSS AND LOSS SETTLEMENTS 
 The Company
shall notify the Reinsurer promptly of all claims which, in the opinion of the Company, may involve the Reinsurer, and of all subsequent developments regarding these claims which may materially affect the position of the Reinsurer. The notification
shall be made in the form of a report, submitted no less frequently than on a quarterly basis, that details losses paid and the expected Ultimate Net Losses for each claim related to a Loss Occurrence subject to this Agreement. 
 All loss settlements made by the Company, provided they are within the terms of the Company’s original Policies and of this
Agreement, shall be binding upon Reinsurer, and amounts falling to the share of Reinsurer shall be payable without delay upon reasonable evidence of the amount being given by the Company. 
 ARTICLE 12 — SALVAGE AND SUBROGATION (BRMA 47E) 
 The Reinsurer shall be credited with salvage or subrogation recoveries (i.e., reimbursement obtained or recovery made by the Company, less loss adjustment expense incurred in obtaining such
reimbursement or making such recovery) on account of claims and settlements involving reinsurance hereunder. Salvage thereon shall always be used to reimburse the excess carriers in the reverse order of their priority according to their
participation before being used in any way to reimburse the Company for its primary loss. The Company hereby agrees to enforce its rights to salvage or subrogation relating to any loss, a part of which loss was sustained by the Reinsurer, and to
prosecute all claims arising out of such rights. 
 ARTICLE 13 — OFFSET (BRMA 36C) 
 The Company and the Reinsurer shall have the right to offset any balance or amounts due from one party to the other under the terms of
the Agreement. The party asserting the right of offset may exercise such right any time whether the balances due are on account of premiums or losses or otherwise. 
 ARTICLE 14 — UNAUTHORIZED REINSURANCE 
 (Applies only to a Reinsurer
who does not qualify for full credit with any insurance regulatory authority having jurisdiction over the Company’s reserves.) 
 As regards Policies or bonds issued by the Company coming within the scope of this Agreement, the Company agrees that when it shall file with the insurance regulatory authority or set up on its books reserves for unearned premium and losses
covered hereunder which it shall be required by law to set up, it will forward to the Reinsurer a statement showing the proportion of such reserves which is applicable to the Reinsurer. The Reinsurer hereby agrees to fund such reserves in respect of
unearned premium (including but not limited to, the unearned portion of any deposit premium installment), known outstanding losses that have been reported to the Reinsurer and allocated Loss Adjustment Expense relating thereto, and losses and
allocated Loss Adjustment Expense paid by the Company but not recovered from the Reinsurer, including all 

  

  
  
  

					
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case reserves plus any reasonable amount estimated to be unreported from known Loss Occurrences as shown in the statement prepared by the Company
(hereinafter referred to as “Reinsurer’s Obligations”) by funds withheld, cash advances or a Letter of Credit. The Reinsurer shall have the option of determining the method of funding provided it is acceptable to the insurance
regulatory authorities having jurisdiction over the Company’s reserves. 
 When funding by a Letter of Credit, the
Reinsurer agrees to apply for and secure timely delivery to the Company of a clean, irrevocable and unconditional Letter of Credit issued by a bank and containing provisions acceptable to the insurance regulatory authorities having jurisdiction over
the Company’s reserves in an amount equal to the Reinsurer’s proportion of said reserves. Such Letter of Credit shall be issued for a period of not less than one year, and shall be automatically extended for one year from its date of
expiration or any future expiration date unless 30 days (60 days where required by insurance regulatory authorities) prior to any expiration date the issuing bank shall notify the Company by certified or registered mail that the issuing bank elects
not to consider the Letter of Credit extended for any additional period. 
 The Reinsurer and Company agree that the Letters
of Credit provided by the Reinsurer pursuant to the provisions of this Agreement may be drawn upon at any time, notwithstanding any other provision of this Agreement, and be utilized by the Company or any successor, by operation of law, of the
Company including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Company for the following purposes, unless otherwise provided for in a separate Trust Agreement: 
  

					
		 	 (a)
	  	 to reimburse the Company for the Reinsurer’s Obligations, the payment of which is due under the terms of this Agreement and which has not been otherwise
paid;

			
		 	 (b)
	  	 to make refund of any sum which is in excess of the actual amount required to pay the Reinsurer’s Obligations under this Agreement;

			
		 	 (c)
	  	 to fund an account with the Company for the Reinsurer’s Obligations. Such cash deposit shall be held in an interest bearing account separate from the Company’s
other assets, and interest thereon not in excess of the prime rate shall accrue to the benefit of the Reinsurer;

			
		 	 (d)
	  	 to pay the Reinsurer’s share of any other amounts the Company claims are due under this Agreement.

 In the event the amount drawn by the Company on any Letter of Credit is in excess
of the actual amount required for (a) or (c), or in the case of (d), the actual amount determined to be due, the Company shall promptly return to the Reinsurer the excess amount so drawn. All of the foregoing shall be applied without diminution
because of insolvency on the part of the Company or the Reinsurer. 
 The issuing 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 ensure that withdrawals are made only upon the order of properly authorized representatives of the Company. 

At annual intervals, or more frequently as agreed but never more frequently than quarterly, the Company shall prepare a specific
statement of the Reinsurer’s Obligations, for the sole purpose of amending the Letter of Credit, in the following manner: 
  

					
		 	 (a)
	  	 If the statement shows that the Reinsurer’s Obligations exceed the balance of credit as of the statement date, the Reinsurer shall, within 30 days after receipt of
notice of such excess, secure

  

  
  
  

					
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		 		  	 delivery to the Company of an amendment to the Letter of Credit increasing the amount of credit by the amount of such difference.

			
		 	 (b)
	  	 If, however, the statement shows that the Reinsurer’s Obligations are less than the balance of credit as of the statement date, the Company shall, within 30 days after
receipt of written request from the Reinsurer, release such excess credit by agreeing to secure an amendment to the Letter of Credit reducing the amount of credit available by the amount of such excess credit.

 ARTICLE 15 — TAXES 
 The Company will be liable for taxes (except Federal Excise Tax) on premiums reported to the Reinsurer hereunder. 
 Federal Excise Tax applies only to those Reinsurers, excepting Underwriters at Lloyd’s London and other Reinsurers exempt from the
Federal Excise Tax, who are domiciled outside the United States of America. 
 The Reinsurer has agreed to allow for the
purposes of paying the Federal Excise Tax the applicable percentage of the premium payable hereon (as imposed under Section 4371 of the Internal Revenue Code) to the extent such premium is subject to Federal Excise Tax. 
 In the event of any return of premium becoming due hereunder the Reinsurer will deduct the applicable percentage from the return premium
payable hereon, and the Company or its agent should take steps to recover the Tax from the U.S. Government. 
 ARTICLE 16 —
CURRENCY 
 The currency to be used for all purposes of this Agreement shall be United States of America currency. 
 ARTICLE 17 — DELAY, OMISSION OR ERROR 
 Any inadvertent delay, omission or error shall not be held to relieve either party hereto from any liability which would attach to it hereunder if such delay, omission or error had not been made,
providing such delay, omission or error is rectified upon discovery. 
 ARTICLE 18 — ACCESS TO RECORDS 

 The Reinsurers or their designated representatives shall have free access at any reasonable time to all records of the
Company which pertain in any way to this Agreement. 
 ARTICLE 19 — ARBITRATION (BRMA 6J) 
 As a condition precedent to any right of action hereunder, in the event of any dispute or difference of opinion hereafter arising with
respect to this Contract, it is hereby mutually agreed that such dispute or difference of opinion shall be submitted to arbitration. One Arbiter shall be chosen by the Company, the other by the Reinsurer, and an Umpire shall be chosen by the two
Arbiters before they enter upon arbitration, all of whom shall be active or retired disinterested executive officers of insurance or reinsurance companies or Lloyd’s London Underwriters. In the event that either party should fail to choose an
Arbiter within thirty (30) days following a written request by the other party to do so, the requesting party may choose two Arbiters who shall in turn choose an Umpire before entering upon arbitration. If the two Arbiters fail to agree upon
the selection of an Umpire within thirty (30) days following their appointment, 

  

  
  
  

					
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	       June 19, 2009
	  	Page 10 of 15	  

 
each Arbiter shall nominate three candidates within ten (10) days thereafter, two of whom the other shall decline, and the decision shall be made by
drawing lots. 
 Each party shall present its case to the Arbiters within thirty (30) days following the date of
appointment of the Umpire. The Arbiters shall consider this Contract as an honorable engagement rather than merely as a legal obligation and they are relieved of all judicial formalities and may abstain from following the strict rules of law. The
decision of the Arbiters shall be final and binding on both parties; but failing to agree, they shall call in the Umpire and the decision of the majority shall be final and binding upon both parties. Judgment upon the final decision of the Arbiters
may be entered in any court of competent jurisdiction. 
 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 one party, provided, however, that nothing herein shall impair the rights of
such reinsurers to assert several, rather than joint, defenses or claims, nor be construed as changing the liability of the reinsurers participating under the terms of this Contract from several to joint. 
 Each party shall bear the expense of its own Arbiter, and shall jointly and equally bear with the other the expense of the Umpire and of
the arbitration. In the event that the two Arbiters are chosen by one party, as above provided, the expense of the Arbiters, the Umpire and the arbitration shall be equally divided between the two parties. 
 Any arbitration proceedings shall take place at a location mutually agreed upon by the parties to this Contract, but notwithstanding the
location of the arbitration, all proceedings pursuant hereto shall be governed by the law of the state in which the Company has its principal office. 
 ARTICLE 20 — SERVICE OF SUIT 
 It is agreed that in the
event of the failure of the Reinsurers hereon to pay any amount claimed to be due hereunder, the Reinsurers hereon, at the request of the Company, will submit to the jurisdiction of a Court of competent jurisdiction within the United States. Nothing
in this Article constitutes or should be understood to constitute a waiver of Reinsurers’ rights to commence an action in any Court of competent jurisdiction in the United States, to remove an action to a United States District Court, or to
seek a transfer of a case to another Court as permitted by the laws of the United States or of any State in the United States. It is further agreed that service of process in such suit may be made upon Messrs Mendes and Mount, 750 Seventh Avenue,
New York, New York 10019-6829, and that in any suit instituted against any one of them upon this Agreement, Reinsurers will abide by the final decision of such Court or of any Appellate Court in the event of an appeal. 
 The above-named are authorized and directed to accept service of process on behalf of 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 upon Reinsurers’ behalf 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 provision therefore, Reinsurers hereon 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 of insurance (or reinsurance), and hereby designate the above-named as the person to whom the said officer is authorized to mail such process or a true copy
thereof. 
  

  
  
  

					
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	       June 19, 2009
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 ARTICLE 21 — INSOLVENCY 
 In the event of the insolvency of the Company, the reinsurance under this Agreement shall be payable by the Reinsurer to the Company or
its liquidator, receiver or statutory successor on the basis of the liability of the Company under the original Policy or Policies reinsured, without diminution because of the insolvency of the Company, except as provided by Section 4118
(a)(1)(A) of the New York Insurance Law, provided the conditions of 1114(c) of such law have been met, if New York law applies, or except (a) where this Agreement specifically provides another payee in the event of the insolvency of the Company
or (b) where a Reinsurer(s) subscribing a participation hereunder with the consent of the original insured or insureds, has assumed such policy obligations of the Company to such payees. 
 If the Company should become insolvent, then the liquidator, receiver or statutory successor of the Company shall give written notice to
the Reinsurer of the pendency of any claim against the Company which is likely to produce a loss under this Agreement within a reasonable time after such claim is filed in the insolvency proceeding; during the pendency of such claim, the Reinsurer
under this Agreement may investigate such claim and interpose, at its own expense, in the proceeding where such claim is to be adjudicated, any defense or defenses which the Reinsurer may deem available to the Company or its liquidator or receiver
or statutory successor. The expense thus incurred by the Reinsurer shall be chargeable, subject to court approval, against the insolvent Company as part of the expense of liquidation to the extent of the benefit which may accrue to the Company
solely as a result of the defense undertaken by the Reinsurer. 
 If those Reinsurers subscribing a majority participation in
this Agreement elect to interpose defense to a claim, the expense shall be apportioned in accordance with the terms of this Agreement as though such expenses had been incurred by the Company. 
 Should the Company go into liquidation or should a receiver be appointed the Reinsurer shall be entitled to deduct from any sums which
may be due or may become due to the Company under this Agreement, any sums which are due to the Reinsurer by the Company under this Agreement and which are due at a fixed or stated date, as well as any other sums due to the Reinsurer which are
permitted to be offset under applicable law. 
 ARTICLE 22 — THIRD PARTY RIGHTS (BRMA 52C) 
 This Agreement is solely between the Company and the Reinsurer, and in no instance shall any other party have any rights under this
Agreement except as expressly provided otherwise in the INSOLVENCY ARTICLE. 
  

  
  
  

					
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	       June 19, 2009
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 ARTICLE 23 -- SEVERABILITY 
 If any provision of this Agreement shall be rendered illegal or unenforceable by the laws, regulations or public policy of any state,
such provision shall be considered void in such state, but this shall not affect the validity or enforceability of any other provision of this Agreement or the enforceability of such provision in any other jurisdiction. 
 ARTICLE 24 -- CONFIDENTIALITY 
 For a period of three years following the termination or expiration of this Agreement, the contracting parties undertake to regard the terms of this Agreement (and any confidential, proprietary information relating
thereto provided in writing to such other party) as confidential, with the parties to effect the same prudence and care afforded by such party to its own confidential, proprietary information. Each party further agrees that it shall not disclose any
of such information to any third party without the prior written consent of the other party or except as may be required by applicable law or regulation, or by legal process (including without limitation as may be required by United States Federal
tax law or regulation), or to the auditors, professional advisors, accountants, retrocessionaires, related managing general agents, directors or officers of such party with a reasonable need to know such information. Except as expressly set forth
above, the parties agree and acknowledge that this Article is not intended to restrict or limit the conduct of the other party’s current or proposed business. 
 ARTICLE 25 -- ENTIRE AGREEMENT (BRMA 74B) 
 This Agreement constitutes the
entire agreement between the parties. In no event shall this Agreement provide any guarantee of profit, directly or indirectly, from the Reinsurer to the Company or from the Company to the Reinsurer. This Agreement may be clarified, amended or
modified only by written agreement signed by both parties. Such written agreement shall become part of this Agreement. 
 ARTICLE 26 --
LAW AND JURISDICTION 
 This Agreement shall be governed by the laws of the State of Florida and shall be subject to
the jurisdiction of the courts of the United States of America (subject to the provisions of the SERVICE OF SUIT ARTICLE). 
 ARTICLE 27 -- INTERMEDIARY 
 BMS Intermediaries 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 Reinsurer through BMS Intermediaries Inc., 5005 LBJ Freeway, Suite 700, Dallas, Texas 75244. Payments by the Company to the intermediary shall be deemed to constitute payment to the Reinsurer.
Payments by the Reinsurer 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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	       June 19, 2009
	  	Page 13 of 15	  

 ARTICLE 28 -- MODE OF EXECUTION 
 Whenever a notice, statement, report or any other written communication is required by this Agreement, unless otherwise specified, such
notice, statement, report or other written communication may be transmitted by certified or registered mail, nationally or internationally recognized express delivery service, personal delivery, electronic mail, or facsimile. With the exception
of notices of termination, first class mail is also acceptable. 
 The use of any of the following shall constitute a valid
execution of this Agreement or any amendments thereto: 
  

	 	A.	 Paper documents with an original ink signature; 

  

	 	B.	 Facsimile or electronic copies of paper documents showing an original ink signature; and/or 

  

	 	C.	 Electronic records with an electronic signature made via an electronic agent. For the purposes of this Agreement, the terms “electronic record,”
“electronic signature” and “electronic agent” shall have the meanings set forth in the Electronic Signatures in Global and National Commerce Act of 2000 or any amendments thereto. 

 This Agreement may be executed in one or more counterparts, each of which, when duly executed, shall be deemed an original. 

Signed in St. Petersburg, Florida this
                 day
of                                      
                                   , 2009. 
 For and on behalf of the Company: 

	
	
	  

 UNITED PROPERTY AND CASUALTY INSURANCE COMPANY 
  

  
  
  

					
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	       June 19, 2009
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 SCHEDULE A 
 First Property Catastrophe Excess of Loss Reinsurance 
 UNITED PROPERTY AND CASUALTY
INSURANCE COMPANY 
 St. Petersburg, Florida 
 This Schedule is attached to and forms a part of the Property Catastrophe Excess of Loss Reinsurance Agreement and sets out specific terms, conditions and participating Reinsurers for the
Company’s First Property Catastrophe Excess of Loss Reinsurance. 
 RETENTION AND LIMIT 
 The Reinsurer will be liable in respect of each and every Loss Occurrence for the Ultimate Net Loss over and above an initial Ultimate
Net Loss of $26,402,427 each and every Loss Occurrence, subject to a limit of liability to the Reinsurer of 95% of $43,000,000 each and every Loss Occurrence. 
 PREMIUM 
 The Company shall pay the Reinsurer a Deposit Premium of $16,340,000
(being 95% of $17,200,000) in accordance with the PREMIUM ARTICLE of this Agreement. The Deposit Premium shall be adjusted in accordance with the PREMIUM ARTICLE of this Agreement, by a provisional rate of 0.0414% to the Company’s Total
Insurance Values in-force for Coverages A, B, C and D in respect of the Company’s Homeowners/Dwelling/Condominium Business (“TIV”) as at September 30, 2009 subject to a minimum premium of $13,072,000. (Minimum premium to be 80%
of the developed Deposit Premiums which are in turn based on TIV at September 30, 2009 of $39,493,781,760.) 
 REINSTATEMENT

 Each claim hereon reduces the amount of indemnity under this Agreement from the time of occurrence of the loss,
but such amount is hereby reinstated from the time of occurrence of the loss in consideration of the payment by the Company of an additional premium calculated by applying to the premium earned hereon, the percentage of the face amount of this
Agreement so reinstated. Nevertheless, the Reinsurer’s liability hereunder shall never exceed 95% of $43,000,000 for any one Loss Occurrence and 95% of $86,000,000 for all Loss Occurrences during the term of this Agreement. 
  

  
  
  

					
	       A9CFHB008_4129088
	  		  	

	       June 19, 2009
	  		  

 SCHEDULE B 
 Second Property Catastrophe Excess of Loss Reinsurance 
 UNITED PROPERTY AND CASUALTY
INSURANCE COMPANY 
 St. Petersburg, Florida 
 This Schedule is attached to and forms a part of the Property Catastrophe Excess of Loss Reinsurance Agreement and sets out specific terms, conditions and participating Reinsurers for the
Company’s Second Property Catastrophe Excess of Loss Reinsurance. 
 RETENTION AND LIMIT 
 The Reinsurer will be liable in respect of each and every Loss Occurrence for the Ultimate Net Loss over and above an initial Ultimate
Net Loss of $69,402,427 each and every Loss Occurrence, subject to a limit of liability to the Reinsurer of 95% of $50,392,285 each and every Loss Occurrence. 
 PREMIUM 
 The Company shall pay the Reinsurer a Deposit Premium of $15,319,255
(being 95% of $16,125,531) in accordance with the PREMIUM ARTICLE of this Agreement. The Deposit Premium shall be adjusted in accordance with the PREMIUM ARTICLE of this Agreement, by a provisional rate of 0.0388% to the Company’s Total
Insurance Values in-force for Coverages A, B, C and D in respect of the Company’s Homeowners/Dwelling/Condominium Business (“TIV”) as at September 30, 2009 subject to a minimum premium of $12,255,404. (Minimum premium to be 80%
of the developed Deposit Premiums which are in turn based on TIV at September 30, 2009 of $39,493,781,760.) 
 REINSTATEMENT

 Each claim hereon reduces the amount of indemnity under this Agreement from the time of occurrence of the loss,
but such amount is hereby reinstated from the time of occurrence of the loss in consideration of the payment by the Company of an additional premium calculated by applying to the premium earned hereon, the percentage of the face amount of this
Agreement so reinstated. Nevertheless, the Reinsurer’s liability hereunder shall never exceed 95% of $50,392,285 for any one Loss Occurrence and 95% of $100,784,570 for all Loss Occurrences during the term of this Agreement. 
  

  
  
  

					
	       A9CFHB008_4129088
	  		  	

	       June 19, 2009
	  		  

 SCHEDULE C 
 Third Property Catastrophe Excess of Loss Reinsurance 
 UNITED PROPERTY AND CASUALTY
INSURANCE COMPANY 
 St. Petersburg, Florida 
 This Schedule is attached to and forms a part of the Property Catastrophe Excess of Loss Reinsurance Agreement and sets out specific terms, conditions and participating Reinsurers for the
Company’s Third Property Catastrophe Excess of Loss Reinsurance. 
 RETENTION AND LIMIT 
 The Reinsurer will be liable in respect of each and every Loss Occurrence for the Ultimate Net Loss over and above an initial Ultimate
Net Loss of $119,794,712 each and every Loss Occurrence, subject to a limit of liability to the Reinsurer of $30,507,128 each and every Loss Occurrence. 
 In the event the limit and retention provided by the FHCF and/or the limit and retention provided by the Temporary Increase in Coverage Limits (“TICL”) are adjusted in accordance with the provisions of the
reimbursement contract between the Company and the State Board of Administration of the State of Florida, the Company’s additional retention, if any, will be included in the limit of liability of the Reinsurer. In no event shall the limit of
liability to the Reinsurer exceed $30,507,128 each and every Loss Occurrence. 
 In the event the coverage provided by the
Temporary Increase in Coverage Limits (“TICL”) and/or the coverage provided by the FHCF is depleted, exhausted or otherwise unavailable, the Reinsurer will be liable in respect of each and every Loss Occurrence for the Ultimate Net Loss
over and above an initial Ultimate Net Loss of $119,794,712 each and every Loss Occurrence, subject to a limit of liability to the Reinsurer of $30,507,128. 
 PREMIUM 
 The Company shall pay the Reinsurer a Deposit Premium of $6,101,426
in accordance with the PREMIUM ARTICLE of this Agreement. The Deposit Premium shall be adjusted in accordance with the PREMIUM ARTICLE of this Agreement, by a provisional rate of 0.0154% to the Company’s Total Insurance Values in-force for
Coverages A, B, C and D in respect of the Company’s Homeowners/Dwelling/Condominium Business (“TIV”) as at September 30, 2009 subject to a minimum premium of $4,881,140.80. (Minimum premium to be 80% of the developed Deposit
Premiums which are in turn based on TIV at September 30, 2009 of $39,493,781,760.) 
 REINSTATEMENT 
 Each claim hereon reduces the amount of indemnity under this Agreement from the time of occurrence of the loss, but such amount is hereby
reinstated from the time of occurrence of the loss in consideration of the payment by the Company of an additional premium calculated by applying to the premium earned hereon, the percentage of the face amount of this Agreement so reinstated.
Nevertheless, the Reinsurer’s liability hereunder shall never exceed $30,507,128 for any one Loss Occurrence and $61,014,256 for all Loss Occurrences during the term of this Agreement. 
  

  
  
  

					
	       A9CFHB008_4129088
	  		  	

	       June 19, 2009
	  		  

 SCHEDULE D 
 Fourth Property Catastrophe Excess of Loss Reinsurance 
 UNITED PROPERTY AND CASUALTY
INSURANCE COMPANY 
 St. Petersburg, Florida 
 This Schedule is attached to and forms a part of the Property Catastrophe Excess of Loss Reinsurance Agreement and sets out specific terms, conditions and participating Reinsurers for the
Company’s Fourth Property Catastrophe Excess of Loss Reinsurance. 
 RETENTION AND LIMIT 
 The Reinsurer will be liable in respect of each and every Loss Occurrence for the Ultimate Net Loss over and above an initial Ultimate
Net Loss of $150,301,840 each and every Loss Occurrence, subject to a limit of liability to the Reinsurer of 50% of $8,804,762 each and every Loss Occurrence. 
 In the event the limit and retention provided by the FHCF and/or the limit and retention provided by the Temporary Increase in Coverage Limits (“TICL”) are adjusted in accordance with
the provisions of the reimbursement contract between the Company and the State Board of Administration of the State of Florida, the Company’s additional retention, if any, will be included in the limit of liability of the Reinsurer. In no event
shall the limit of liability to the Reinsurer exceed 50% of $8,804,762 each and every Loss Occurrence. 
 In the event the
coverage provided by the Temporary Increase in Coverage Limits (“TICL”) and/or the coverage provided by the FHCF is depleted, exhausted or otherwise unavailable, the Reinsurer will be liable in respect of each and every Loss Occurrence for
the Ultimate Net Loss over and above an initial Ultimate Net Loss of $150,301,840 each and every Loss Occurrence, subject to a limit of liability to the Reinsurer of 50% of $8,804,762. 
 PREMIUM 
 The
Company shall pay the Reinsurer a Deposit Premium of $638,345 (being 50% of $1,276,690) in accordance with the PREMIUM ARTICLE of this Agreement. The Deposit Premium shall be adjusted in accordance with the PREMIUM ARTICLE of this Agreement, by a
provisional rate of 0.0016% to the Company’s Total Insurance Values in-force for Coverages A, B, C and D in respect of the Company’s Homeowners/Dwelling/Condominium Business (“TIV”) as at September 30, 2009 subject to a
minimum premium of $510,676. (Minimum premium to be 80% of the developed Deposit Premiums which are in turn based on TIV at September 30, 2009 of $39,493,781,760.) 
 REINSTATEMENT 
 Each claim hereon reduces the amount of indemnity under this
Agreement from the time of occurrence of the loss, but such amount is hereby reinstated from the time of occurrence of the loss in consideration of the payment by the Company of an additional premium calculated by applying to the premium earned
hereon, the percentage of the face amount of this Agreement so reinstated. Nevertheless, the Reinsurer’s liability hereunder shall never exceed 50% of $8,804,762 for any one Loss Occurrence and 50% of $17,609,524 for all Loss Occurrences during
the term of this Agreement. 
  

  
  
  

					
	       A9CFHB008_4129088
	  		  	

		  		  

 NUCLEAR INCIDENT EXCLUSION CLAUSE - PHYSICAL-DAMAGE - REINSURANCE - U.S.A. 
  

	 	1.	 This Agreement does not cover any loss or liability accruing to the Reassured, directly or indirectly, and whether as Insurer or Reinsurer, from any Pool of
Insurers or Reinsurers formed for the purpose of covering Atomic or Nuclear Energy risks. 

  

	 	2.	 Without in any way restricting the operation of paragraph (1) of this Clause, this Agreement does not cover any loss or liability accruing to the Reassured,
directly or indirectly and whether as Insurer or Reinsurer, from any insurance against Physical Damage (including business interruption or consequential loss arising out of such Physical Damage) to: 

  

	 	I.	 Nuclear reactor power plants including all auxiliary property on the site, or 

  

	 	II.	 Any other nuclear reactor, installation, including laboratories handling radioactive materials in connection with reactor installations, and “critical
facilities” as such, or 

  

	 	III.	 Installations for fabricating complete fuel elements or for processing substantial quantities of “special nuclear material,” and for reprocessing,
salvaging, chemically separating, storing or disposing of “spent” nuclear fuel or waste materials, or 

  

	 	IV.	 Installations other than those listed in paragraph (2) III above using substantial quantities of radioactive isotopes or other products of nuclear fission.

  

	 	3.	 Without in any way restricting the operation of paragraphs (1) and (2) hereof, this Agreement does not cover any loss or liability by radioactive
contamination accruing to the Reassured, directly or indirectly, and whether as Insurer or Reinsurer, from any insurance on property which is on the same site as a nuclear reactor power plant or other nuclear installation and which normally would be
insured therewith except that this paragraph (3) shall not operate. 

  

	 	(a)	 where Reassured does not have knowledge of such nuclear reactor power plant or nuclear installation, or 

  

	 	(b)	 where the said insurance contains a provision excluding coverage for damage to property caused by or resulting from radioactive contamination, however caused.
However, on and after 1st January, 1960 this sub-paragraph (b) shall only apply provided the said radioactive contamination exclusion provision has been approved by the Governmental Authority having jurisdiction thereof.

  

	 	4.	 Without in any way restricting the operation of paragraphs (1), (2) and (3) hereof, this Agreement does not cover any loss or liability by radioactive
contamination accruing to the Reassured, directly or indirectly, and whether as Insurer or Reinsurer, when such radioactive contamination is a named hazard specifically insured against. 

  

	 	5.	 It is understood and agreed that this Clause shall not extend to risks using radioactive isotopes in any form where the nuclear exposure is not considered by the
Reassured to be the primary hazard. 

  

	 	6.	 The term “special nuclear material” shall have the meaning given it in the Atomic Energy Act of 1954 or by any law amendatory thereof.

  

	 	7.	Reassured to be sole judge of what constitutes: 

  

	 	(a)	 substantial quantities, and 

  

  
  
  

					
	       A9CFHB008_4129088
	  		  	

		  		  

	 	(b)	 the extent of installation, plant or site. 

 Note - Without in any way restricting the operation of paragraph (I) hereof, it is understood and agreed that 
  

	 	(a)	 all policies issued by the Reassured on or before 31st December 1957 shall be free from the application of the other provisions of this Clause until expiry
date or 31st December 1960 whichever first occurs whereupon all the provisions of this Clause shall apply. 

  

	 	(b)	 with respect to any risk located in Canada policies issued by the Reassured on or before 31st December 1958 shall be free from the application of the other
provisions of this Clause until expiry date or 31st December 1960 whichever first occurs whereupon all the provisions of this Clause shall apply. 

 In accordance with NMA 1119 (12/12/57) 
  

  
  
  

					
	       A9CFHB008_4129088
	  		  	

		  		  

 TERRORISM EXCLUSION 
 (Property Treaty Reinsurance) 
 Notwithstanding any provision to the contrary within this
reinsurance agreement or any endorsement thereto, it is agreed that this reinsurance agreement excludes loss, damage, cost, or expense directly or indirectly caused by, contributed to by, resulting from, or arising out of or in connection with any
act of terrorism, as defined herein, regardless of any other cause or event contributing concurrently or in any other sequence to the loss. 
 An act of terrorism includes any act, or preparation in respect of action, or threat of action designed to influence the government de jure or de facto of any nation or any political division thereof, or in pursuit of
political, religious, ideological or similar purposes to intimidate the public or a section of the public of any nation by any person or group(s) of persons whether acting alone or on behalf of or in connection with any organisation(s) or
government(s) de jure or de facto, and which: 
  

	 	(i)	 involves violence against one or more persons; or 

	 	(ii)	 involves damage to property; or 

	 	(iii)	 endangers life other than that of the person committing the action; or 

	 	(iv)	 creates a risk to health or safety of the public or a section of the public; or 

	 	(v)	 is designed to interfere with or to disrupt an electronic system. 

 This reinsurance agreement also excludes loss, damage, cost or expense directly or indirectly caused by, contributed to by, resulting from, or arising out of or in connection with any action in
controlling, preventing, suppressing, retaliating against, or responding to any act of terrorism. 
 Notwithstanding the
above and subject otherwise to the terms, conditions, and limitations of this reinsurance agreement, in respect only of personal lines this reinsurance agreement will pay actual loss or damage (but not related cost or expense) caused by any act of
terrorism provided such act is not directly or indirectly caused by, contributed to by, resulting from, or arising out of or in connection with biological, chemical, radioactive, or nuclear pollution or contamination or explosion. 
 NMA2930c 
 22/11/02 
 Form approved by Lloyd’s Market Association [Non-Marine] 
  

  
  
  

					
	 A9CFHB008_4129088
	  		  	

		  		  

 INTERESTS AND LIABILITIES CONTRACT 
 in respect of the 
 PROPERTY CATASTROPHE 
 EXCESS OF LOSS REINSURANCE AGREEMENT 
 between 
 UNITED PROPERTY AND CASUALTY INSURANCE COMPANY 
 St. Petersburg, Florida 
 (hereinafter referred to as the “Company”)

 and 
 XYZ REINSURANCE
COMPANY 
 (hereinafter referred to as the “Subscribing Reinsurer”) 
 It is hereby agreed by and between the Company, of the one part, and the Subscribing Reinsurer, of the other part, that the Subscribing
Reinsurer subscribes a share of the Interests and Liabilities of the Reinsurer as set forth in the PROPERTY CATASTROPHE EXCESS OF LOSS REINSURANCE AGREEMENT effective June 1, 2009 as set forth below: 
 EXHIBIT A – X% 
 EXHIBIT B – X% 
 EXHIBIT C – X% 
 EXHIBIT D – X% 
 The share(s) of the Subscribing Reinsurer in the
Interests and Liabilities of the “Reinsurer” in respect of the said Agreement shall be separate and apart from the shares of the other reinsurers subscribing to the said Agreement, and the Interests and Liabilities of the Subscribing
Reinsurer shall not be joint with those of the other reinsurers, and the Subscribing Reinsurer in no event shall participate in the Interests and Liabilities of the other reinsurers subscribing hereon. 
 IN WITNESS WHEREOF, the SUBSCRIBING REINSURER hereto by their respective duly authorized officers have executed this Contract as of the
date undermentioned: 
 Signed in Anytown, Anystate, this
                             day of
                                         
                                         
      , 2009. 
 _______________________________________ 
 XYZ REINSURANCE COMPANY 
  

  
  
  

					
	       A9CFHB008_4129088Form of Florida Hurricane Catastrophe Fund

 Exhibit 10.2 
  

							
	

	  	 STATE BOARD OF ADMINISTRATION
 OF FLORIDA
  
 1801
HERMITAGE BOULEVARD
 TALLAHASSEE, FLORIDA 32308
 (850) 488-4406
  
 POST OFFICE BOX 13300
 32317-3300
	  	 CHARLIE CRIST
 GOVERNOR
 AS CHAIRMAN
  
 ALEX SINK
 CHIEF FINANCIAL OFFICER

 AS TREASURER
  
 BILL McCOLLUM
 ATTORNEY GENERAL

 AS SECRETARY
  
 ASH WILLIAMS
 EXECUTIVE DIRECTOR &
CIO
	 	
		  	 REIMBURSEMENT CONTRACT
  
 Effective: June 1, 2009
 (Contract)
  
 between
  
 UNITED PROPERTY AND CASUALTY INSURANCE COMPANY
 St. Petersburg, FL
 (Company)

 
 NAIC # 10969
  
 and
	  		 	
	  
 THE STATE BOARD OF ADMINISTRATION OF THE STATE OF
FLORIDA (SBA)
 WHICH ADMINISTERS THE FLORIDA HURRICANE CATASTROPHE FUND (FHCF)
  
 PREAMBLE
  
 The Legislature of the State of Florida has enacted Section 215.555, Florida
Statutes “Statute”, which directs the SBA to administer the FHCF. This Contract, consisting of the principal document entitled Reimbursement Contract, addressing the mandatory FHCF coverage, and Addenda, is subject to the Statute and to
any administrative rule adopted pursuant thereto, and is not intended to be in conflict therewith. All provisions in the principle document are equally applicable to each Addenda unless specifically superseded by one of the Addenda.
  
 In consideration of the promises set forth in this Contract, the
parties agree as follows:
  
 ARTICLE I - SCOPE OF
AGREEMENT
  
 As a condition precedent to the SBA’s obligations
under this Contract, the Company, an Authorized Insurer or an entity writing Covered Policies under Section 627.351, Florida Statutes, in the State of Florida, shall report to the SBA in a specified format the business it writes which is
described in this Contract as Covered Policies.
  
 The terms
of this Contract shall determine the rights and obligations of the parties. This Contract provides reimbursement to the Company under certain circumstances, as described herein, and does not provide or extend insurance or reinsurance coverage to any
person, firm, corporation or other entity. The SBA shall reimburse the Company for its Ultimate Net Loss on Covered Policies in excess of the
	 	

  

					
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Company’s Retention as a result of each Loss Occurrence commencing during the Contract Year, to the extent funds are available, all as hereinafter
defined. 
 ARTICLE II- PARTIES TO THE CONTRACT 
 This Contract is solely between the Company and the SBA which administers the FHCF. In no instance shall any insured of the Company or any claimant against an insured of the Company, or any other third party, have any rights under this
Contract, except as provided in Article XIV. The SBA will only disburse funds to the Company, except as provided for in Article XIV of this Contract. The Company shall not, without the prior approval of the Office of Insurance Regulation, sell,
assign, or transfer to any third party, in return for a fee or other consideration any sums the FHCF pays under this Contract or the right to receive such sums. 
 ARTICLE III - TERM 
 This Contract shall apply to Loss Occurrences which commence during the period from 12:00:01 a.m.,
Eastern Time, June 1, 2009, to 12:00 midnight Eastern Time, May 31, 2010 (Contract Year). 
 The Company must designate a coverage
level, make the required selections, and return this fully executed Contract (two originals) to the FHCF Administrator so that the Contract is received by the FHCF Administrator no later than 5 p.m., Central Time, June 1, 2009. Failure to do so
may result in a referral to the Office of Insurance Regulation within the Department of Financial Services for administrative action. Furthermore, the Company’s coverage level under this Contract will be deemed as follows: 

	(1)	 For Companies that are a member of a National Association of Insurance Commissioners (NAIC) group, the same coverage level selected by the other Companies of the
same NAIC group shall be deemed. If executed Contracts for none of the members of an NAIC group have been received by the FHCF Administrator, the coverage level from the prior Contract Year shall be deemed. 

	(2)	 For Companies that are not a member of an NAIC group under which other Companies are active participants in the FHCF, the coverage level from the prior Contract
Year shall be deemed. 

	(3)	 For New Participants, as that term is defined in Article V(21), that are a member of an NAIC group, the same coverage level selected by the other Companies of
the same NAIC group shall be deemed. 

	(4)	 For New Participants that are not a member of an NAIC group under which other Companies are active participants in the FHCF, the 45%, 75% or 90% coverage levels
may be selected providing that the FHCF Administrator receives executed Contracts within 30 calendar days of the effective date of the first Covered Policy, otherwise, the 45% coverage level shall he deemed. 

 Pursuant to the terms of this Contract, the SBA shall not be liable for Loss Occurrences which commence after the effective time and date of expiration
or termination. Should this Contract expire or terminate while a Loss Occurrence covered hereunder is in progress, the SBA shall be responsible for such Loss Occurrence in progress in the same manner and to the same extent it would have been
responsible had the Contract expired the day following the conclusion of the Loss Occurrence in progress. 
 ARTICLE IV - LIABILITY OF THE FHCF

  

	(1)	 The SBA shall reimburse the Company, with respect to each Loss Occurrence commencing during the Contract Year for the “Reimbursement Percentage”
elected, this percentage times the amount of Ultimate Net Loss paid by the Company in excess of the Company’s Retention, as adjusted pursuant to Article V(28), plus 5% of the reimbursed losses for Loss Adjustment Expense Reimbursement.

	(2)	 The Reimbursement Percentage will be 45% or 75% or 90%, at the Company’s option as elected under Article XVIII. 

  

					
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	(3)	 The aggregate liability of the FHCF with respect to all Reimbursement Contracts covering this Contract Year shall not exceed the limit set forth under
Section 2l5.555(4)(c)1., Florida Statutes. For specifics regarding loss reimbursement calculations, see section (3)(c) of Article X herein. 

	(4)	 Upon the occurrence of a Covered Event, the SBA shall evaluate the potential losses to the FHCF and the FHCF’s capacity at the time of the event. The
initial Projected Payout Multiple used to reimburse the Company for its losses shall not exceed the Projected Payout Multiple as calculated based on the capacity needed to provide the FHCF’s mandatory coverage. The SBA shall make adjustments to
the Projected Payout Multiple in order to reimburse the optional coverage based on the SBA’s ongoing evaluation of potential losses and capacity. 

	(5)	 Reimbursement amounts shall not be reduced by reinsurance paid or payable to the Company from other sources. 

	(6)	 After the end of the calendar year, the SBA shall notify insurers of the estimated Borrowing Capacity and the Balance of the Fund as of December 31. In May
and October of each year, the SBA shall publish in the Florida Administrative Weekly a statement of the FHCF’s estimated Borrowing Capacity and the projected Balance of the Fund as of December 31. 

	(7)	 The obligation of the SBA with respect to all Contracts covering a particular Contract Year shall not exceed the Balance of the Fund as of December 31 of
that Contract Year, together with the maximum amount the SBA is able to raise through the issuance of revenue bonds or other means available to the SBA under Section 215.555, Florida Statutes, up to the limit in accordance with
Section 215.555(4)(c)1., Florida Statutes. The obligations and the liability of the SBA are more fully described in Rule 19-8.013, Florida Administrative Code (F.A.C.). 

 ARTICLE V - DEFINITIONS 
  

	(1)	 Actual Claims-Paying Capacity of the FHCF 

 This term means the sum of the Balance of the Fund as of December 31 of a Contract Year, plus any reinsurance purchased by the FHCF, plus the amount the SBA is able to raise through the issuance of revenue bonds up to
the limit in accordance with Section 215.555(4)(c)1. and (6), Florida Statutes. 

	(2)	 Actuarially Indicated 

 This term means, with respect to Premiums paid by Companies for reimbursement provided by the FHCF, an amount determined in accordance with the definition provided in Section 215.555(2)(a), Florida Statutes.

	(3)	 Additional Living Expense (ALE) 

 ALE losses covered by the FHCF are not to exceed 40 percent of the insured value of a Residential Structure or its contents based on the coverage provided in the policy. Fair rental value, loss of rents, or business
interruption losses are not covered by the FHCF. 

	(4)	 Administrator 

 This term means the entity with which the SBA contracts to perform administrative tasks associated with the operations of the FHCF. The Administrator is Paragon Strategic Solutions Inc., 8200 Norman Center Drive, Bloomington, Minnesota
55437. The telephone number is (800) 689-3863, and the facsimile number is (800) 264-0492. 

	(5)	 Authorized Insurer 

 This term is defined in Section 624.09(1), Florida Statutes. 

	(6)	 Borrowing Capacity 

 This term means the amount of funds which are able to be raised by the issuance of revenue bonds or through other financing mechanisms, less bond issuance expenses and reserves. 

	(7)	 Citizens Property Insurance Corporation (Citizens) 

 This term means the entity formed under Section 627.351(6), Florida Statutes and refers to both Citizens Property Insurance Corporation High Risk Account and Citizens Property Insurance
Corporation Personal Lines and Commercial Lines Accounts. 
  

					
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	(8)	 Contract 

 This term means this Reimbursement Contract for the current Contract Year. 

	(9)	 Covered Event 

 This term means any one storm declared to be a hurricane by the National Hurricane Center which causes insured losses in Florida. A Covered Event begins when a hurricane causes damage in Florida while it is a hurricane and continues
throughout any subsequent downgrades in storm status by the National Hurricane Center regardless of whether the hurricane makes landfall. Any storm, including a tropical storm, which does not become a hurricane is not a Covered Event. 

	(10)	 Covered Policy or Covered Policies 

	 	(a)	 Covered Policy, as defined in Section 215.555(2)(c), Florida Statutes, is further clarified to mean only that portion of a binder, policy or contract of
insurance that insures real or personal property located in the State of Florida to the extent such policy insures a Residential Structure, as defined in definition (27) herein, or the contents of a Residential Structure, located in the State of
Florida. 

	 	(b)	 Due to the specialized nature of the definition of Covered Policies, Covered Policies are not limited to only one line of business in the Company’s annual
statement required to be filed by Section 624.424, Florida Statutes. Instead, Covered Policies are found in several lines of business on the Company’s annual statement. Covered Policies will at a minimum be reported in the Company’s
statutory annual statement as: 

	 	1.	 Fire 

	 	2.	 Allied Lines 

	 	3.	 Farmowners Multiple Peril 

	 	4.	 Homeowners Multiple Peril 

	 	5.	 Commercial Multiple Peril (non liability portion, covering condominiums and apartments) 

	 	6.	 Inland Marine 

 Note that where particular insurance exposures, e.g. mobile homes, are reported on an annual statement is not dispositive of whether or not the exposure is a Covered Policy. 

	 	(c)	 This definition applies only to the first-party property section of a policy pertaining strictly to the structure, its contents, appurtenant structures, or ALE
coverage. 

	 	(d)	 Covered Policy also includes any collateral protection insurance policy covering personal residences which protects both the borrower’s and the
lender’s financial interest, in an amount at least equal to the coverage for the dwelling in place under the lapsed homeowner’s policy, if such policy can be accurately reported as required in Section 215.555(5), Florida Statutes. A
Company will be deemed to be able to accurately report data if the required data, as specified in the Premium Formula adopted in Section 215.555(5), Florida Statutes, is available. 

	 	(e)	 See Article VI of this Contract for specific exclusions. 

	(11)	 Deductible Buy-Back Policies 

 This term means a specific policy that provides coverage to a policyholder for some portion of the policyholder’s deductible under a policy issued by another insurer. 

	(12)	 Estimated Claims-Paying Capacity of the FHCF 

 This term means the sum of the projected Balance of the Fund as of December 31 of a Contract Year, plus any reinsurance purchased by the FHCF, plus the most recent estimate of the Borrowing
Capacity of the FHCF, determined pursuant to Section 215.555(4)(c), Florida Statutes. 

	(13)	 Excess Policies 

 This term, for the purposes of this Contract, means a policy that provides insurance protection for large commercial property risks that provides a layer of coverage above a primary layer (which is insured by a different insurer) that acts
much the same as a very large deductible. 
  

					
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	(14)	 Florida Department of Financial Services (Department) 

 This term means the Florida regulatory agency, created pursuant to Section 20.121, Florida Statutes, which is charged with regulating the Florida insurance market and administering the
Florida Insurance Code. 

	(15)	 Florida Insurance Code 

 This term means those chapters identified in Section 624.01, Florida Statutes, which are designated as the Florida Insurance Code. 

	(16)	 Formula or the Premium Formula 

 This term means the Formula approved by the SBA for the purpose of determining the Actuarially Indicated Premium to be paid to the FHCF. The Premium Formula is defined as an approach or methodology which leads to the
creation of premium rates. The resulting rates are therefore incorporated as part of the Premium Formula. 

	(17)	 Fund Balance or Balance of the Fund as of December 31 

 These terms mean the amount of assets available to pay claims, not including any bonding proceeds, resulting from Covered Events which occurred during the Contract Year. 

	(18)	 Insurer Group 

 For purposes of the coverage option election in Section 215.555(4)(b), Florida Statutes, Insurer Group means the group designation assigned by the National Association of Insurance Commissioners (NAIC) for purposes of filing
consolidated financial statements. A Company is a member of a group as designated by the NAIC until such Company is assigned another group designation or is no longer a member of a group recognized by the NAIC. 

	(19)	 Loss Occurrence 

 This term means the sum of individual insured losses incurred under Covered Policies resulting from the same Covered Event. “Losses” means direct incurred losses under Covered Policies and excludes Loss Adjustment Expenses.

	(20)	 Loss Adjustment Expense Reimbursement 

	 	(a)	 Loss Adjustment Expense Reimbursement shall be 5% of the reimbursed losses under this Contract as provided in Article IV, pursuant to
Section 215.555(4)(b)1, Florida Statutes. 

	 	(b)	 To the extent that loss reimbursements are limited to the Payout Multiple applied to each Company, the 5% Loss Adjustment Expense is included in the total Payout
Multiple applied to each Company. 

	(21)	 New Participant(s) 

 This term means all Companies which begin writing Covered Policies on or after the beginning of the Contract Year. A Company that removes exposure from either Citizens entity, as that term is defined in (7) above, pursuant to an
assumption agreement effective on or after June 1 and had written no other Covered Policies before June 1 is also considered a New Participant. 

	(22)	 Office of Insurance Regulation 

 This term means that office within the Department of Financial Services and which was created in Section 20.121(3), Florida Statutes. 

	(23)	 Payout Multiple 

 This term means the multiple as calculated in accordance with Section 215.555(4)(c), Florida Statutes, which is derived by dividing the single season Claims-Paying Capacity of the FHCF by the total aggregate industry Reimbursement
Premium for the FHCF for the Contract Year billed as of December 31 of the Contract Year. The final Payout Multiple is determined once Reimbursement Premiums have been billed as of December 31 and the amount of bond proceeds has been
determined. 

	(24)	 Premium 

 This term means the same as Reimbursement Premium. 

	(25)	 Projected Payout Multiple 

 The Projected Payout Multiple is used to calculate a Company’s projected payout pursuant to Section 215.555(4)(d)2., Florida Statutes. The Projected Payout Multiple is derived by dividing the 

  

					
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estimated single season Claims-Paying Capacity of the FHCF by the estimated total aggregate industry Reimbursement Premium for the FHCF for the Contract
Year. The Company’s Reimbursement Premium as paid to the SBA for the Contract Year is multiplied by the Projected Payout Multiple to estimate the Company’s coverage from the FHCF for the Contract Year. 

	(26)	 Reimbursement Premium 

 This term means the Premium determined by multiplying each $1,000 of insured value reported by the Company in accordance with Section 215.555(5)(b), Florida Statutes, by the rate as derived from the Premium Formula,
as described in Rule 19-8.028, F.A.C. 

	(27)	 Residential Structures 

 This term means dwelling units used as a home or residence, including the primary structure and appurtenant structures insured under the same policy and any other structures covered under endorsements associated with
a policy covering a residential structure, the principal function of which at the time of loss was as a primary or secondary residence. Covered Residential Structures do not include any structures listed under Article VI herein. 

	(28)	 Retention 

 The Company’s Retention means the amount of hurricane losses under Covered Policies which must be incurred by the Company before it is eligible for reimbursement from the FHCF. 

	 	(a)	 When the Company experiences covered losses from one or two Covered Events during the Contract Year, the Company’s full Retention shall be applied to each
of the Covered Events. 

	 	(b)	 When the Company experiences covered losses from more than two Covered Events during the Contract Year, the Company’s full Retention shall be applied to
each of the two Covered Events causing the largest covered losses for the Company. For each other Covered Event resulting in covered losses, the Company’s Retention shall be reduced to one-third of its full Retention and applied to all other
Covered Events. 

	 	1.	 All reimbursement of covered losses for each Covered Event shall be based on the Company’s full Retention until January 1 of the Contract Year. Adjustments
to reflect a reduction to one-third of the full Retention shall be made as soon as practicable after January 1 of the Contract Year provided the Company reports its losses as specified in this Contract. 

	 	2.	 Adjustments to the Company’s Retention shall be based upon its paid and outstanding losses as reported on the Company’s Proof of Loss Reports but shall
not include incurred but not reported losses. The Company’s Proof of Loss Reports shall be used to determine which Covered Events constitute the Company’s two largest Covered Events, and the reduction to one-third of the full Retention
shall be applied to all other Covered Events for the Contract Year. After this initial determination, any subsequent adjustments shall be made by the SBA only if the quarterly loss reports reveal that loss development patterns have resulted in a
change in the order of Covered Events entitled to the reduction to one-third of the full Retention. 

	 	(c)	 The Company’s full Retention is established in accordance with the provisions of Section 215.555(2)(e), Florida Statutes, and shall be determined by
multiplying the Retention Multiple by the Company’s Reimbursement Premium for the Contract Year. 

	 	(d)	 Once the Company’s limit of coverage has been exhausted, the Company will not be entitled to further reimbursements. 

	(29)	 Retention Multiple 

	 	(a)	 The Retention Multiple is applied to the Company’s Reimbursement Premium to determine the Company’s Retention. The Retention Multiple for the 2009/2010
Contract Year shall be equal to $4.5 billion, adjusted based upon the reported exposure for the 2008/2009 Contract Year to reflect the percentage growth in exposure to the FHCF since 2004, divided by the estimated total industry Reimbursement
Premium at the 90% reimbursement percentage level for the Contract Year as determined by the SBA. 

	 	(b)	 The Retention Multiple as determined under (29)(a) above shall be adjusted to reflect the 

  

					
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reimbursement percentage elected by the Company under this Contract as follows: 

	 	1.	 If the Company elects a 90% reimbursement percentage, the adjusted Retention Multiple is 100% of the amount determined under (29)(a) above;

	 	2.	 If the Company elects a 75% reimbursement percentage, the adjusted Retention Multiple is 120% of the amount determined under (29)(a) above; or

	 	3.	 If the Company elects a 45% reimbursement percentage, the adjusted Retention Multiple is 200% of the amount determined under (29)(a) above.

  

	(30)	 Ultimate Net Loss 

	 	(a)	 This term means all losses of the Company under Covered Policies, prior to the application of the Company’s FHCF Retention, as defined under
(28) above, and reimbursement percentage, and excluding loss adjustment expense, arising from each Loss Occurrence during the Contract Year, provided, however, that the Company’s loss shall be determined in accordance with the deductible
level written under the policy sustaining the loss. 

	 	(b)	 Salvages and all other recoveries, excluding reinsurance recoveries, shall be first deducted from such loss to arrive at the amount of liability attaching
hereunder. 

	 	(c)	 All salvages, recoveries or payments recovered or received subsequent to a loss settlement under this Contract shall be applied as if recovered or received prior
to the aforesaid settlement and all necessary adjustments shall be made by the parties hereto. 

	 	(d)	 Nothing in this clause shall be construed to mean that losses under this Contract are not recoverable until the Company’s Ultimate Net Loss has been
ascertained. 

	 	(e)	 The SBA shall be subrogated to the rights of the Company to the extent of its reimbursement of the Company. The Company agrees to assist and cooperate with the
SBA in all respects as regards such subrogation. The Company further agrees to undertake such actions as may be necessary to enforce its rights of salvage and subrogation, and its rights, if any, against other insurers as respects any claim, loss,
or payment arising out of a Covered Event. 

 ARTICLE VI - EXCLUSIONS 
 This Contract does not provide reimbursement for: 

	(1)	 Any losses not defined as being within the scope of a Covered Policy. 

	(2)	 Any policy which excludes wind or hurricane coverage. 

	(3)	 Any Excess Policy or Deductible Buy-Back Policy that requires individual ratemaking. 

	(4)	 Any policy for Residential Structures, as defined in Article V(27) herein, that provides a layer of coverage underneath an Excess Policy, as defined in Article
V(13) herein, issued by a different insurer. 

	(5)	 Any liability of the Company attributable to losses for fair rental value, loss of rent or rental income, or business interruption. 

	(6)	 Any collateral protection policy that does not meet the definition of Covered Policy as defined in Article V(10)(d) herein. 

	(7)	 Any reinsurance assumed by the Company. 

	(8)	 Any exposure for hotels, motels, timeshares, shelters, camps, retreats, and any other rental property used solely for commercial purposes.

	(9)	 Any exposure for homeowner associations if no habitational structures are insured under the policy. 

	(10)	 Any exposure for homes and condominium structures or units that are non-owner occupied and rented for six (6) or more rental periods by different parties
during the course of a twelve (12) month period. 

	(11)	 Commercial healthcare facilities and nursing homes; however, a nursing home which is an integral part of a retirement community consisting primarily of
habitational structures that are not nursing homes will not be subject to this exclusion. 

  

					
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	(12)	 Any exposure under commercial policies covering only appurtenant structures or structures that do not function as a habitational structure (e.g. a policy
covering only the pool of an apartment complex). 

	(13)	 Personal contents in a commercial storage facility covered under a policy that covers only those personal contents. 

	(14)	 Policies covering only Additional Living Expense. 

	(15)	 Any exposure for barns or barns with apartments. 

	(16)	 Any exposure for builders risk coverage or new residential structures still under construction. 

	(17)	 Any exposure described as a vacant property under a commercial policy. 

	(18)	 Any exposure for recreational vehicles or boats (including boat related equipment) requiring licensing and written on a separate policy or endorsement.

	(19)	 Any liability of the Company for extra contractual obligations and excess of original policy limits liabilities. 

	(20)	 Any losses paid in excess of a policy’s hurricane limit in force at the time of each Covered Event, including individual coverage limits (i.e., building,
appurtenant structures, contents, and additional living expense). This exclusion includes overpayments of a specific individual coverage limit even if total payments under the policy are within the aggregate policy limit.

	(21)	 Any losses paid under a policy for Additional Living Expense, written as a time element coverage, in excess of the Additional Living Expense exposure reported
for that policy under the Data Call for the applicable Contract Year (unless policy limits have changed effective after June 30th of the Contract Year). 

	(22)	 Any losses for which the Company’s claims files do not adequately support. Claim file support shall be deemed adequate if in compliance with the Records
Retention Requirements outlined on the Form FHCF-L1B (Proof of Loss Report) applicable to the Contract Year. 

	(23)	 Any losses attributable to loss assessments that are not hurricane-related expenses. 

	(24)	 Losses in excess of the sum of the Balance of the Fund as of December 31 of the Contract Year and the amount the SBA is able to raise through the issuance
of revenue bonds or by the use of other financing mechanisms, up to the limit pursuant to Section 215.555(4)(c), Florida Statutes. 

	(25)	 Any liability assumed by the Company from Pools, Associations, and Syndicates. Exception: Covered Policies assumed from Citizens under the terms and conditions
of an executed assumption agreement between the Authorized Insurer and Citizens are covered by this Contract. 

	(26)	 All liability of the Company arising by contract, operation of law, or otherwise, from its participation or membership, whether voluntary or involuntary, in any
insolvency fund. “Insolvency fund” includes any guaranty fund, insolvency fund, plan, pool, association, fund or other arrangement, howsoever denominated, established or governed, which provides for any assessment of or payment or
assumption by the Company of part or all of any claim, debt, charge, fee, or other obligation of an insurer, or its successors or assigns, which has been declared by any competent authority to be insolvent, or which is otherwise deemed unable to
meet any claim, debt, charge, fee or other obligation in whole or in part. 

	(27)	 Any liability of the Company for loss or damage caused by or resulting from nuclear reaction, nuclear radiation, or radioactive contamination from any cause,
whether direct or indirect, proximate or remote, and regardless of any other cause or event contributing concurrently or in any other sequence to the loss. 

	(28)	 The FHCF does not provide coverage for water damage which is generally excluded under property insurance contracts and has been defined to mean flood, surface
water, waves, tidal water, overflow of a body of water, storm surge, or spray from any of these, whether or not driven by wind. 

	(29)	 Specialized Fine Arts Risks as defined in Rule 19-8.028(4)(d), F.A.C. 

	(30)	 Claims for loss assessment coverage under Covered Policies with an effective date after the date of the Covered Event for which the loss assessments are
attributed. 

  

					
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 ARTICLE VII - MANAGEMENT OF CLAIMS AND LOSSES 
 The Company shall investigate and settle or defend all claims and losses. All payments of claims or losses by the Company within the terms and limits of the appropriate coverage parts of Covered
Policies shall be binding on the SBA, subject to the terms of this Contract, including the provisions in Article XIII relating to inspection of records and examinations. 
 ARTICLE VIII - LOSS REIMBURSEMENT ADJUSTMENTS 
  

	(1)	 Offsets 

 The SBA reserves the right to offset amounts payable to the SBA from the Company, including amounts payable under previous Contract Years, against any reimbursement or advance amounts due and payable to the Company from the SBA as a result
of the liability of the SBA. 

	(2)	 Reimbursement Adjustments 

 Section 215.555(4)(d) and (e), Florida Statutes, provides the SBA with the right to seek the return of excess loss reimbursements which have been paid to the Company along with interest thereon. Excess loss
reimbursements are those payments made to the Company by the SBA that are in excess of the Company’s coverage under the Contract Year. Excess loss reimbursements may result from adjustments to the Projected Payout Multiple or the Payout
Multiple, incorrect exposure (Data Call) submissions or resubmissions, incorrect calculations of Reimbursement Premiums or Retentions, incorrect Proof of Loss Reports, incorrect calculation of reinsurance recoveries, or subsequent readjustment of
policyholder claims, including subrogation and salvage, or any combination of the foregoing. The Company will be sent an invoice showing the due date for adjustments along with the interest due thereon through the due date. The applicable interest
rate for interest credits, and for interest charges for adjustments beyond the Company’s control, will be the average rate earned by the SBA for the FHCF for the first five months of the Contract Year. The applicable interest rate for interest
charges due to adjustments resulting from incorrect exposure submissions or Proof of Loss Reports will accrue at this rate plus 5%. However, in recognition that the SBA’s loss examination process for a particular Contract Year may span several
years, and to eliminate the disparity between Companies scheduled for loss examinations throughout a multi-year process, the interest rate applicable to reimbursement adjustments resulting from loss reimbursement examinations shall not include the
additional 5%. All interest will continue to accrue if not paid by the due date. 
 ARTICLE IX - REIMBURSEMENT PREMIUM 
  

	(1)	 The Company shall, in a timely manner, pay the SBA its Reimbursement Premium for the Contract Year. The Reimbursement Premium for the Contract Year shall be
calculated in accordance with Section 215.555, Florida Statutes, with any rules promulgated thereunder, and with Article X(2). 

	(2)	 Since the calculation of the Actuarially Indicated Premium assumes that the Companies will pay their Reimbursement Premiums timely, interest charges will accrue
under the following circumstances. A Company may choose to estimate its own Premium installments. However, if the Company’s estimation is less than the provisional Premium billed, an interest charge will accrue on the difference between the
estimated Premium and the final Premium. If a Company estimates its first installment, the Administrator shall bill that estimated Premium as the second installment as well, which will be considered as an estimate by the Company. No interest will
accrue regarding any provisional Premium if paid as billed by the FHCF’s Administrator, except in the case of an estimated second installment as set forth in this Article. Also, if a Company makes an estimation that is higher than the
provisional Premium billed but is less than the final Premium, interest will not accrue. If the Premium payment is not received from a Company when it is due, an interest charge will accrue on a daily basis until the payment is received. Interest
will also accrue on Premiums resulting from submissions or resubmissions finalized after December 1 of the Contract Year. An interest credit will be applied for any Premium which is overpaid as either an estimate or as a 

  

					
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provisional Premium. Interest shall not be credited past December 1 of the Contract Year. The applicable interest rate for interest credits will be the
average rate earned by the SBA for the FHCF for the first five months of the Contract Year. The applicable interest rate for interest charges will accrue at this rate plus 5%. 

 ARTICLE X - REPORTS AND REMITTANCES 
  

	(1)	 Exposures 

	 	(a)	 If the Company writes Covered Policies before June 1 of the Contract Year, the Company shall report to the SBA, unless otherwise provided in Rule 19-8.029,
F.A.C., no later than the statutorily required date of September 1 of the Contract Year, by ZIP Code or other limited geographical area as specified by the SBA, its insured values under Covered Policies as of June 30 of the Contract Year
as outlined in the annual reporting of insured values form, FHCF-D1A (Data Call) adopted for the Contract Year under Rule 19-8.029, F.A.C., and other data or information in the format specified by the SBA. 

	 	(b)	 If the Company first begins writing Covered Policies on or after June 1 but prior to December 1 of the Contract Year, the Company shall report to the
SBA, no later than March 1 of the Contract Year, by ZIP Code or other limited geographical area as specified by the SBA, its insured values under Covered Policies as of December 31 of the Contract Year as outlined in the Supplemental
Instructions for New Participants section of the Data Call adopted for the Contract Year under Rule 19-8.029, F.A.C., and other data or information in the format specified by the SBA. 

	 	(c)	 If the Company first begins writing Covered Policies on or after December 1 but through and including May 31 of the Contract Year, the Company shall
not report its exposure data for the Contract Year to the SBA. 

	 	(d)	 The requirement that a report is due on a certain date means that the report shall be in the physical possession of the FHCF’s Administrator in Minneapolis
no later than 5 p.m. on the due date. If the applicable due date is a Saturday, Sunday or legal holiday, then the actual due date will be the day immediately following the applicable due date which is not a Saturday, Sunday or legal holiday. For
purposes of the timeliness of the submission, neither the United States Postal Service postmark nor a postage meter date is in any way determinative. Reports sent to the SBA in Tallahassee, Florida, will be returned to the sender. Reports not in the
physical possession of the FHCF’s Administrator by 5 p.m., Central Time, on the applicable due date are late. 

	 	(e)	 Pursuant to the provisions of Section 215.557, Florida Statutes, the reports of insured values under Covered Policies by ZIP Code submitted to the SBA
pursuant to Section 215.555, Florida Statutes, are confidential and exempt from the provisions of Section 119.07(1), Florida Statutes, and Section 24(a), Art. I of the State Constitution. 

	(2)	 Reimbursement Premium 

	 	(a)	 If the Company writes Covered Policies before June 1 of the Contract Year, the Company shall pay the FHCF its Reimbursement Premium in installments due on
or before August 1, October 1, and December 1 of the Contract Year in amounts to be determined by the FHCF. However, if the Company’s Reimbursement Premium for the prior Contract Year was less than $5,000, the Company’s
full provisional Reimbursement Premium, in an amount equal to the Reimbursement Premium paid in the prior year, shall be due in full on or before August 1 of the Contract Year. The Company will be invoiced for amounts due, if any, beyond the
provisional Reimbursement Premium payment, on or before December 1 of the Contract Year. In addition, if control of the Company has been transferred through any legal or regulatory proceeding to a state regulator or court appointed receiver or
rehabilitator (referred to in the aggregate as “State action”), the full annual provisional Reimbursement Premium as billed and any outstanding balances will be due and payable on August 1, or the date that such State action occurs after

  

					
		 	10	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

	 	 
August 1 of the Contract Year. Such acceleration will not apply when the receiver or rehabilitator provides a letter of assurance to the FHF that the
Company will have the resources to pay the premium in installments in accordance with the contractual provisions. 

	 	(b)	 A New Participant that first begins writing Covered Policies on or after June 1 but prior to December 1 of the Contract Year shall pay the FHCF a
provisional Reimbursement Premium of $1,000 upon execution of this Contract. The Administrator shall calculate the Company’s actual Reimbursement Premium for the period based on its actual exposure as of December 31 of the Contract Year,
as reported on or before March 1. To recognize that New Participants have limited exposure during this period, the actual Premium as determined by processing the Company’s exposure data shall then be divided in half, the provisional
Premium shall be credited, and the resulting amount shall be the total Premium due for the Company for the remainder of the Contract Year. However, if that amount is less than $1,000, then the Company shall pay $1,000. The Premium payment is due no
later than May 1 of the Contract Year. The Company’s Retention and coverage will be determined based on the total Premium due as calculated above. 

	 	(c)	 A New Participant that first begins writing Covered Policies on or after December 1 but through and including May 31 of the Contract Year shall pay the
FHCF a Reimbursement Premium of $1,000 upon execution of this Contract. 

	 	(d)	 The requirement that the Reimbursement Premium is due on a certain date means that the Premium shall be in the physical possession of the FHCF no later than 5
p.m., Eastern Time, on the due date applicable to the particular installment. If remitted by check to the FHCF’s Post Office Box, the check shall be physically in the Post Office Box 550261, Tampa, FL 33655-0261, as set out on the invoice sent
to the Company. If remitted by check by hand delivery, the check shall be physically on the premises of the FHCF’s bank in Tampa, Florida, as set out on the invoice sent to the Company. If remitted electronically, the wire transfer shall have
been completed to the FHCF’s account at its bank in Tampa, Florida, as set out on the invoice sent to the Company. If the applicable due date is a Saturday, Sunday or legal holiday, then the actual due date will be the day immediately following
the applicable due date which is not a Saturday, Sunday or legal holiday. For purposes of the timeliness of the remittance, neither the United States Postal Service postmark nor a postage meter date is in any way determinative. Premium checks sent
to the SBA in Tallahassee, Florida, or to the FHCF’s Administrator in Minneapolis, Minnesota, will be returned to the sender. Reimbursement Premiums not in the physical possession of the FHCF by 5 p.m., Eastern Time, on the applicable due date
are late. 

	 	(e)	 Except as required by Section 215.555(7)(c), Florida Statutes, or as described in the following sentence, Reimbursement Premiums, together with earnings
thereon, received in a given Contract Year will be used only to pay for losses attributable to Covered Events occurring in that Contract Year or for losses attributable to Covered Events in subsequent Contract Years and will not be used to pay for
past losses or for debt service on revenue bonds. Pursuant to Section 215.555(6)(a)1., Florida Statutes, Reimbursement Premiums and earnings thereon may be used for payments relating to revenue bonds in the event Emergency Assessments are
insufficient. If Reimbursement Premiums or earnings thereon are used for debt service on revenue bonds, then the amount of the Reimbursement Premiums or earnings thereon so used shall be returned, without interest, to the Fund when Emergency
Assessments or other legally available funds remain available after making payment relating to the revenue bonds and any other purposes for which Emergency Assessments were levied. 

	(3)	 Claims and Losses 

	 	(a)	 In General 

	 	1.	 Claims and losses resulting from Loss Occurrences commencing during the Contract Year shall be reported by the Company and reimbursed by the FHCF as provided
herein and in accordance with the Statute, this Contract, and any rules adopted pursuant to the Statute. For a Company participating in a quota share primary insurance agreement(s) with Citizens 

  

					
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		 		 	Rule 19-8.010 F.A.C.

	 	 
Property Insurance Corporation High Risk Account, Citizens and the Company shall report only their respective portion of losses under the quota share primary
insurance agreement(s). Pursuant to Section 215.555(4)(c), Florida Statutes, the SBA is obligated to pay for losses not to exceed the Actual Claims-Paying Capacity of the FHCF, up to the limit in accordance with Section 215.555(4)(c)1.,
Florida Statutes, for any one Contract Year. 

	 	2.	 If the Company is in non-compliance with Section 215.555, Florida Statutes for any Contract Year, including deadlines for sending in Contracts, addendums or
attachments to Contracts, Data Call submissions or resubmissions, loss reports, or in responding to SBA exam requirements, the SBA reserves the right to withhold reimbursements or advances until such time the Company becomes compliant.

	(b)	 Loss Reports 

	 	1.	 At the direction of the SBA, the Company shall report its projected Ultimate Net Loss from each Loss Occurrence to provide information to the SBA in determining
any potential liability for possible reimbursable losses under the Contract on the Interim Loss Report, Form FHCF-L1A, adopted for the Contract Year under Rule 19-8.029, F.A.C. Interim Loss Reports (including subsequent Interim Loss Reports if
required by the SBA) will be due in no less than fourteen days from the date of the notice from the SBA that such a report is required. 

	 	2.	 FHCF loss reimbursements will be issued based on Ultimate Net Loss information reported by the Company on the Proof of Loss Report, Form FHCF-L1B, adopted for
the Contract Year under Rule 19-8.029, F.A.C. To qualify for reimbursement, the Proof of Loss Report must have the original signatures of two executive officers authorized by the Company to sign the report. The Company must also submit a
detailed claims listing (as outlined on the Proof of Loss Report) at the same time it submits its first Proof of Loss Report for a specific Covered Event that qualifies the Company for reimbursement under that Covered Event, and should be prepared
to supply a detailed claims listing for any subsequent Proof of Loss Report upon request. While a Company may submit a Proof of Loss Report requesting reimbursement at any time following a Loss Occurrence, all Companies shall submit a mandatory
Proof of Loss Report for each Loss Occurrence no earlier than December 1 and no later than December 31 of the Contract Year during which the Covered Event(s) occurs using the most current data available, regardless of the amount of
Ultimate Net Loss or the amount of loss reimbursements or advances already received. Reports may be faxed only if the Company does not qualify for a reimbursement. 

	 	3.	 Updated Proof of Loss Reports for each Loss Occurrence are due quarterly thereafter until all claims and losses resulting from a Loss Occurrence are fully
discharged including any adjustments to such losses due to salvage or other recoveries, or the Company has received its full coverage under the Contract Year in which the Loss Occurrence(s) occurred. Guidelines follow: 

	 	a.	 Quarterly Proof of Loss Reports are due by March 31 from an insurer whose losses exceed, or are expected to exceed, 50% of its FHCF Retention for a specific
Loss Occurrence(s). 

	 	b.	 Quarterly Proof of Loss Reports are due by June 30 from an insurer whose losses exceed, or are expected to exceed, 75% of its FHCF Retention for a specific
Loss Occurrence(s). 

	 	c.	 Quarterly Proof of Loss Reports are due by September 30 and quarterly thereafter from an insurer whose losses exceed, or are expected to exceed, its FHCF
Retention for a specific Loss Occurrence(s). 

 If the Company’s Retention must be recalculated as the
result of an exposure resubmission, and if the recalculated Retention changes the FHCF’s reimbursement obligations, then the Company shall submit additional Proof of Loss Reports for recalculation of the FHCF’s obligations. 
  

					
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		 		 	Rule 19-8.010 F.A.C.

	 	4.	 Annually after December 31 of the Contract Year, all Companies shall submit a mandatory year-end Proof of Loss Report for each Loss Occurrence, as
applicable, using the most current data available. This Proof of Loss Report shall be filed no earlier than December 1 and no later than December 31 of each year and shall continue until the earlier of the commutation process described in
(3)(d) below or until all claims and losses resulting from the Loss Occurrence are fully discharged including any adjustments to such losses due to salvage or other recoveries. 

	 	5.	 The SBA, except as noted below, will determine and pay, within 30 days or as soon as practicable after receiving Proof of Loss Reports, the reimbursement amount
due based on losses paid by the Company to date and adjustments to this amount based on subsequent quarterly information. The adjustments to reimbursement amounts shall require the SBA to pay, or the Company to return, amounts reflecting the most
recent determination of losses. 

	 	a.	 The SBA shall have the right to consult with all relevant regulatory agencies to seek all relevant information, and shall consider any other factors deemed
relevant, prior to the issuance of reimbursements. 

	 	b.	 The SBA shall require commercial self-insurance funds established under Section 624.462, Florida Statutes, to submit contractor receipts to support paid
losses reported on a Proof of Loss Report, and the SBA may hire an independent consultant to confirm losses, prior to the issuance of reimbursements. 

	 	c.	 The SBA shall have the right to conduct a claims examination prior to the issuance of any advances or reimbursements submitted by Companies that have been placed
under regulatory supervision by a State or where control has been transferred through any legal or regulatory proceeding to a state regulator or court appointed receiver or rehabilitator. 

	 	6.	 If a Covered Event occurs during the Contract Year, but after December 31, at the direction of the SBA, Companies shall file an Interim Loss Report within
30 days after the Covered Event and Proof of Loss Reports quarterly thereafter. Subparagraphs 2-5 above regarding Proof of Loss Reports shall apply. 

	 	7.	 All Proof of Loss Reports received will be compared with the FHCF’s exposure data to establish the facial reasonableness of the reports. The SBA may also
review the results of current and prior Contract Year exposure and loss examinations to determine the reasonableness of the reported losses. Except as noted in paragraph 4. above, Companies meeting these tests for reasonableness will be scheduled
for reimbursement. Companies not meeting these tests for reasonableness will be handled on a case-by-case basis and will be contacted to provide specific information regarding their individual book of business. The discovery of errors in a
Company’s reported exposure under the Data Call may require a resubmission of the current Contract Year Data Call which, as the Data Call impacts the Company’s premium, retention, and coverage for the Contract Year, will be required before
the Company’s request for reimbursement or an advance will be fully processed by the Administrator. 

	(c)	 Loss Reimbursement Calculations 

	 	1.	 In general, the Company’s paid Ultimate Net Losses must exceed its full FHCF Retention for a specific Covered Event before any reimbursement is payable from
the FHCF for that Covered Event. As described in Article V(28)(b), Retention adjustments will be made after January 1 of the Contract Year. No interest is payable on additional payments to the Company due to this type of Retention adjustment.
Each Company sustaining reimbursable losses will receive the amount of reimbursement due under the Contract up to the amount of the Company’s payout. If more than one Covered Event occurs in any one Contract Year, any reimbursements due from
the FHCF shall take into account the Company’s Retention for each Covered Event. However, the Company’s reimbursements from the FHCF for all Covered Events occurring during the Contract Year shall not exceed, in aggregate, the 

  

					
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		 		 	Rule 19-8.010 F.A.C.

	 	 
Projected Payout Multiple or Payout Multiple, as applicable, times the individual Company’s Reimbursement Premium for the Contract Year.

	 	2.	 In determining reimbursements under this Contract, the SBA shall reimburse each of the Companies, including entities created pursuant to Section 627.351(6),
Florida Statutes, for the amount (if any) of reimbursement due under the individual Company’s Contract, but not to exceed for all Loss Occurrences, an amount equal to the Projected Payout Multiple or the Payout Multiple, as applicable, times
the individual Company’s Reimbursement Premium for the Contract Year. 

	 	3.	 Reserve established. When a Covered Event occurs in a subsequent Contract Year when reimbursable losses are still being paid for a Covered Event in a previous
Contract Year, the SBA will establish a reserve for the outstanding reimbursable losses for the previous Contract Year, based on the length of time the losses have been outstanding, the amount of losses already paid, the percentage of incurred
losses still unpaid, and any other factors specific to the loss development of the Covered Events involved. 

	(d)	 Commutation 

	 	1.	 Not less than 36 months or more than 60 months after the end of the Contract Year, the SBA shall initiate the commutation process. While the Company may request
that the SBA consider beginning the commutation process earlier, doing so shall be at the discretion of the SBA. 

	 	a.	 If the Company’s most recently submitted Proof of Loss Report(s) indicate that it has no losses resulting from a Loss Occurrence(s) during the Contract
Year, the FHCF’s obligations will end 30 days following notice by the SBA of the intent to close out the Company’s loss reporting for the Contract Year. If the Company determines that it does have losses to report, the Company must submit
an up-to-date Proof of Loss Report(s), along with an explanation of why the losses had not been previously reported, within 30 days following the notice by the SBA. After closure by the FHCF, the company will not be reimbursed for any losses for the
Contract Year regardless of circumstances or information discovered following such closure. 

	 	b.	 If the Company has submitted a Proof of Loss Report(s) indicating that it does have losses resulting from a Loss Occurrence(s) during the Contract Year, the SBA
shall initiate the commutation process by requiring the Company to submit within 30 days an updated, current Proof of Loss Report(s) for each Loss Occurrence during the Contract Year. The Proof of Loss Report(s) must include all paid losses as well
as all outstanding losses, including incurred but not reported, which are not finally settled and which may be reimbursable losses under this Contract, and must be accompanied by a copy of a written opinion on the present value of the outstanding
losses by the Company’s certifying actuary. Failure of the Company to provide an updated current Proof of Loss Report(s) and an opinion by the date requested by the SBA shall result in referral to the Office of Insurance Regulation for a
violation of the Contract. 

	 	2.	 Determining the present value of outstanding claims and losses. 

	 	a.	 If the Company exceeds or expects to exceed its Retention, the Company and the SBA or their respective representatives shall attempt, by mutual agreement, to
agree upon the present value of all outstanding claims and losses, both reported and incurred but not reported, resulting from Loss Occurrences during the Contract Year. Payment by the SBA of its portion of any amount or amounts so mutually agreed
and certified by the Company’s certifying actuary shall constitute a complete and final release of the SBA in respect of all claims and losses, both reported and unreported, under this Contract. 

	 	b.	 If agreement on present value cannot be reached within 60 days, the Company and the SBA may mutually appoint an actuary or appraiser to investigate and determine
such claims or losses. If both parties then agree, the SBA shall pay its portion of the amount so determined to be the present value of such claims or losses. 

  

					
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		 		 	Rule 19-8.010 F.A.C.

	 	c.	 If the parties fail to agree, then any difference shall be settled by a panel of three actuaries, one to be chosen by each party and the third by the two so
chosen. If either party does not appoint an actuary within 30 days, the other party may appoint two actuaries. If the two actuaries fail to agree on the selection of a third actuary within 30 days of their appointment, each of them shall name two,
of whom the other shall decline one and the decision shall be made by drawing lots. All the actuaries shall be regularly engaged in the valuation of property claims and losses and shall be members of the Casualty Actuarial Society and of the
American Academy of Actuaries. None of the actuaries shall be under the control of either party to this Contract. Each party shall submit its case to its actuary within 30 days of the appointment of the third actuary. The decision in writing of any
two actuaries, when filed with the parties hereto, shall be final and binding on both parties. 

	 	d.	 The reasonable and customary expense of the actuaries and of the commutation (as a result of b. and c. above) shall be equally divided between the two parties.
Said commutation shall take place in Tallahassee, Florida, unless some other place is mutually agreed upon by the Company and the SBA. 

	 	3.	 If at any point during the commutation process information which indicates an increase in the Company’s reimbursable losses is provided by the Company or
discovered as a result of an examination by the SBA, the SBA may suspend the time frame for the commutation process. After such suspension, the SBA shall determine when it is appropriate to resume the commutation process.

	(4)	 Advances 

	 	(a)	 In accordance with Section 215.555(4)(e), Florida Statutes, the SBA may make advances for loss reimbursements as defined herein, at market interest rates,
to the Company in accordance with Section 215.555(4)(e), Florida Statutes. An advance is an early reimbursement which allows the Company to continue to pay claims in a timely manner. Advances will be made based on the Company’s paid and
reported outstanding losses for Covered Policies (excluding all incurred but not reported [IBNR] losses) as reported on a Proof of Loss Report, and shall include Loss Adjustment Expense Reimbursement as calculated by the FHCF. In order to be
eligible for an advance, the Company must submit its exposure data for the Contract Year as required under paragraph (1) of this Article. Except as noted below, advances, if approved, will be made as soon as practicable after the SBA receives a
written request, signed by two officers of the Company, for an advance of a specific amount and any other information required for the specific type of advance under subparagraphs (c) and (e) below. All reimbursements due to a Company
shall be offset against any amount of outstanding advances plus the interest due thereon. 

	 	(b)	 For advances or excess advances, which are advances that are in excess of the amount to which the Company is entitled, the market interest rate shall be the
prime rate as published in the Wall Street Journal on the first business day of the Contract Year. This rate will be adjusted annually on the first business day of each subsequent Contract Year, regardless of whether the Company executes subsequent
Contracts. All interest charged will commence on the date the SBA issues a check for an advance and will cease on the date upon which the FHCF has received the Company’s Proof of Loss Report(s) for the Covered Event(s) for which the Company
qualifies for reimbursement(s). If such reimbursement(s) are less than the amount of outstanding advance(s) issued to the Company, interest will continue to accrue on the outstanding balance of the advance(s) until subsequent Proof of Loss Reports
qualify the Company for reimbursement under any Covered Event equal to or exceeding the amount of any outstanding advance(s). Interest shall be billed on a periodic basis. If it is determined that the Company received funds in excess of those to
which it was entitled, the interest as to those sums will not cease on the date of the receipt of the Proof of Loss Report but will continue until the Company reimburses the FHCF for the overpayment. 

  

					
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		 		 	Rule 19-8.010 F.A.C.

	 	(c)	 If the Company has an outstanding advance balance as of December 31 of this or any other Contract Year, the Company is required to have an actuary certify
outstanding and incurred but not reported losses as reported on the applicable December Proof of Loss Report. 

	 	(d)	 The specific type of advances enumerated in the Section 215.555, Florida Statutes, follow. 

	 	1.	 Advances to Companies to prevent insolvency, as defined under Article XIV of this Contract. 

	 	a.	 Section 215.555(4)(e)1., Florida Statutes, provides that the SBA shall advance to the Company amounts necessary to maintain the solvency of the Company, up
to 50 percent of the SBA’s estimate of the reimbursement due to the Company. 

	 	b.	 In addition to the requirements outlined in subparagraph (4)(a) above, the requirements for an advance to a Company to prevent insolvency are that the
Company demonstrates it is likely to qualify for reimbursement and that the immediate receipt of moneys from the SBA is likely to prevent the Company from becoming insolvent, and the Company provides the following information:

			
	i.	 	 Current assets;

	ii.	 	 Current liabilities other than liabilities due to the Covered Event;

	iii.	 	 Current surplus as to policyholders;

	iv.	 	 Estimate of other expected liabilities not due to the Covered Event; and

	v.	 	 Amount of reinsurance available to pay claims for the Covered Event under other reinsurance treaties.

	 	c.	 The SBA’s final decision regarding an application for an advance to prevent insolvency shall be based on whether or not, considering the totality of the
circumstances, including the SBA’s obligations to provide reimbursement for all Covered Events occurring during the Contract Year, granting an advance is essential to allowing the entity to continue to pay additional claims for a Covered Event
in a timely manner. 

	 	2.	 Advances to entities created pursuant to Section 627.351(6), Florida Statutes. 

	 	a.	 Section 2l5.555(4)(e)2., Florida Statutes, provides that the SBA may advance to an entity created pursuant to Section 627.351(6), Florida Statutes, up
to 90% of the lesser of the SBA’s estimate of the reimbursement due or the entity’s share of the actual aggregate Reimbursement Premium for that Contract Year, multiplied by the current available liquid assets of the FHCF.

	 	b.	 In addition to the requirements outlined in subparagraph (4)(a) above, the requirements for an advance to entities created pursuant to
Section 627.351(6), Florida Statutes are that the entity must demonstrate to the SBA that the advance is essential to allow the entity to pay claims for a Covered Event. 

	 	3.	 Advances to limited apportionment companies. 

 Section 215.555(4)(e)3., Florida Statutes, provides that the SBA may advance the amount of estimated reimbursement payable to limited apportionment companies. 

	 	(e)	 In determining whether or not to grant an advance and the amount of an advance, the SBA: 

	 	1.	 Shall determine whether its assets available for the payment of obligations are sufficient and sufficiently liquid to fulfill its obligations to other Companies
prior to granting an advance; 

	 	2.	 Shall review and consider all the information submitted by such Companies; 

	 	3.	 Shall review such Companies’ compliance with all requirements of Section 215.555, Florida Statutes; 

	 	4.	 Shall consult with all relevant regulatory agencies to seek all relevant information; 

	 	5.	 Shall review the damage caused by the Covered Event and when that Covered Event occurred; 

	 	6.	 Shall consider whether the Company has substantially exhausted amounts previously advanced; and 

	 	7.	 Shall consider any other factors deemed relevant. 

  

					
		 	16	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

	 	8.	 Shall require commercial self-insurance funds established under section 624.462, Florida Statutes, to submit a copy of written estimates of expenses in support
of the amount of advance requested. 

	 	(f)	 Any amount advanced by the SBA shall be used by the Company only to pay claims of its policyholders for the Covered Event or Covered Events which have
precipitated the immediate need to continue to pay additional claims as they become due. 

	(5)	 Delinquent Premium Payments 

 Failure to submit a Premium or Premium installment when due is a violation of the terms of this Contract and Section 215.555, Florida Statutes. Interest on late payments shall be due as set forth in Article IX(2)
of this Contract. 

	(6)	 Inadequate Data Submissions 

 If exposure data or other information required to be reported by the Company under the terms of this Contract is not received by the FHCF in the format specified by the FHCF and is inadequate to the extent that the
FHCF requires resubmission of data, the Company will be required to pay the FHCF a resubmission fee of $1,000 for resubmissions that are not a result of an examination by the SBA. If a resubmission is necessary as a result of an examination report
issued by the SBA, the first resubmission fee will be $2,000. If the Company’s examination-required resubmission is inadequate and the SBA requires an additional resubmission(s), the resubmission fee for each subsequent resubmission shall be
$2,000. A resubmission of exposure data may delay the processing of the Company’s request for reimbursement or an advance. 

	(7)	 Delinquent Submissions 

 Failure to submit an exposure submission or resubmission, or loss reports, when due is a violation of the terms of this Contract and Section 215.555, Florida Statutes. 
 ARTICLE XI - TAXES 
 In consideration of the terms
under which this Contract is issued, the Company agrees to make no deduction in respect of the Premium herein when making premium tax returns to the appropriate authorities. Should any taxes be levied on the Company in respect of the Premium herein,
the Company agrees to make no claim upon the SBA for reimbursement in respect of such taxes. 
 ARTICLE XII - ERRORS AND OMISSIONS 
 Any inadvertent delay, omission, or error on the part of the SBA shall not be held to relieve the Company from any liability which would attach to it
hereunder if such delay, omission, or error had not been made. 
 ARTICLE XIII - INSPECTION OF RECORDS 
 The Company shall allow the SBA to inspect, examine, and verify, at reasonable times, all records of the Company relating to the Covered Policies under
this Contract, including Company files concerning claims, losses, or legal proceedings regarding subrogation or claims recoveries which involve this Contract, including premium, loss records and reports involving exposure data or losses under
Covered Policies. This right by the SBA to inspect, examine, and verify shall survive the completion and closure of an exposure examination or loss examination file and the termination of the Contract. The Company shall have no right to re-open an
exposure or loss reimbursement examination once closed and the findings have been accepted by the Company; any re-opening shall be at the sole discretion of the SBA. If the FHCF Finance Corporation has issued revenue bonds and relied upon the
exposure and loss data submitted and certified by the Company as accurate to determine the amount of bonding needed, the SBA may choose not to require, or accept, a resubmission if the resubmission will result in additional reimbursements to the
Company. The SBA may require any discovered errors, inadvertent omissions, and typographical errors associated with the data reporting of insured values, discovered prior to the closing of the file and acceptance of the examination findings by the
Company, to be corrected to reflect 

  

					
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		 		 	Rule 19-8.010 F.A.C.

 
the proper values. The Company shall retain its records in accordance with the requirements for records retention regarding exposure reports and claims
reports outlined herein, and in any administrative rules adopted pursuant to Section 215.555, Florida Statutes. Companies writing covered collateral protection policies, as defined in definition (10)(d) of Article V herein, must be able to
provide documentation that the policy covers personal residences, protects both the borrower’s and lender’s interest, and that the coverage is in an amount at least equal to the coverage for the dwelling in place under the lapsed
homeowner’s policy. 

	(1)	 Examination Requirements for Exposure Verification 

 The Company shall retain complete and accurate records, in policy level detail, of all exposure data submitted to the SBA in any Contract Year until the SBA has completed its examination of the
Company’s exposure submissions. The Company shall also retain complete and accurate records of any completed exposure examination for any Contract Year in which the Company incurred losses until the completion of the loss reimbursement
examination for that Contract Year. The records to be retained shall include the exam file which supports the exposure reported to the SBA and any other information which would allow for a complete examination of the Company’s reported exposure
data. The exam file shall be prepared according to the SBA Exam File Specifications outlined in the Data Call. The Company must also have available, at the time of the examination, a copy of its underwriting manual, a copy of its rating manual, and
staff to respond to the questions of the SBA or its agents. The Company is also required to retain declarations pages and policy applications to support reported exposure. To meet the requirement that the application must be retained, the Company
may retain either the actual application or may retain the actual application in an electronic format. A complete list of records to be retained is set forth in Form FHCF-EAP1, adopted for the Contract Year under Rule 19-8.030, F.A.C. 

	(2)	 Examination Requirements for Loss Reports 

 The Company shall retain complete and accurate records of all reported losses and/or advances submitted to the SBA until the SBA has completed its examination of the Company’s reimbursable losses. The records to
be retained are set forth as part of the Proof of Loss Report, Form FHCF-L1B, adopted for the Contract Year under Rule 19-8.029, F.A.C., and Form FHCF-LAP1, adopted for the Contract Year under Rule 19-8.030, F.A.C. The Company must also retain the
required exposure exam file for the Contract Year in which the loss occurred, and must have available any other information which would allow for a complete examination of the Company’s losses. 

	(3)	 Examination Procedures 

	 	(a)	 The FHCF will send an examination notice to the Company providing the commencement date of the examination, the site of the examination, any accommodation
requirements of the examiner, and the reports and data which must be assembled by the Company and forwarded to the FHCF upon request. The Company shall be prepared to choose one location in which to be examined, unless otherwise specified by the
SBA. 

	 	(b)	 The reports and data are required to be forwarded to the FHCF as set forth in an examination notice letter. The information is then forwarded to the examiner. If
the FHCF receives accurate and complete records as requested, the examiner will contact the Company to inform the Company as to what policies or other documentation will be required once the examiner is on site. Any records not required to be
provided to the examiner in advance shall be made available at the time the examiner arrives on site. Any records to support reported losses which are provided after the examiner has left the work-site will, at the SBA’s discretion, result in
an additional examination of exposure and/or loss records or an extension or expansion of the examination already in progress. All costs associated with such additional examination or with the extension or expansion of the original examination shall
be borne by the Company. 

	 	(c)	 At the conclusion of the examiner’s work and the management review of the examiner’s report, findings, recommendations, and work papers, the FHCF will
forward a preliminary 

  

					
		 	18	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

							
		 		  		  	 draft of the examination report to the Company and require a response from the Company by a date certain as to the examination findings and
recommendations.

		 	 (d)
	  		  	 If the Company accepts the examination findings and recommendations, and there is no recommendation for additional information, the examination report will be finalized
and the exam file closed.

		 	 (e)
	  		  	 If the Company disputes the examiner’s findings, the areas in dispute will be resolved by a meeting or a conference call between the Company and FHCF
management.

		 	 (f)
	  	1.  	  	 If the recommendation of the examiner is to resubmit the Company’s exposure data for the Contract Year in question, then the FHCF will send the Company a letter
outlining the process for resubmission and including a deadline to resubmit. The resubmission will include a data file to be submitted to the FHCF’s Administrator and an exam file to be submitted to the offices of the SBA. The resubmission is
also required to be accompanied by a detailed written description of the specific changes made to the resubmitted data. Once the resubmission is received by the FHCF’s Administrator, the FHCF’s Administrator calculates a revised
Reimbursement Premium for the Contract Year which has been examined. The SBA shall then review the resubmission with respect to the examiner’s findings, and accept the resubmission or contact the Company with any questions regarding the
resubmission. Once the SBA has accepted the resubmission as a sufficient response to the examiner’s findings, the FHCF’s Administrator will send the Company an invoice for any Reimbursement Premium and interest due or to refund
Reimbursement Premium, as the case may be. Once the resubmission has been approved, the exam file is closed.

		 		  	2.  	  	 If the recommendation of the examiner is either to resubmit the Company’s exposure data for the Contract Year in question or giving the option to pay the estimated
Premium difference, then the FHCF will send the Company a letter outlining the process for resubmission or for paying the estimated Premium difference and including a deadline for the resubmission or the payment to be received by the FHCF’s
Administrator. If the Company chooses to resubmit, the same procedures outlined in Article XIII(3)(f)2. apply.

		 		  	(g)  	  	 If the recommendation of the examiner is to update the Company’s Proof of Loss Report(s) for the Contract Year under review, the FHCF will send the Company a letter
outlining the process for submitting the Proof of Loss Report(s) and including a deadline to file. The updated Proof of Loss Report(s) will be submitted to the FHCF’s Administrator with a copy of the Proof of Loss Report(s) and a supporting
detailed claims listing to be submitted to the offices of the SBA. The report is required to be accompanied by a detailed written description of the specific changes made. Once the Proof of Loss Report(s) is received by the FHCF Administrator, the
FHCF’s Administrator will calculate a revised reimbursement. The SBA shall then review the submitted Proof of Loss Report(s) with respect to the examiner’s findings, and accept the Proof of Loss Report(s) as filed or contact the Company
with any questions. Once the SBA has accepted the corrected Proof of Loss Report(s) as a sufficient response to the examiner’s findings, the FHCF’s Administrator will send the Company an invoice for any overpayments and interest due. Once
the Proof of Loss Report(s) is approved, the exam file is closed.

		 	(h)	  		  	 If the Company continues to dispute the examiner’s findings and/or recommendations and no resolution of the disputed matters is obtained through discussions between the
Company and FHCF management, then the process within the SBA is at an end and further administrative remedies may be pursued under Chapter 120, Florida Statutes.

		 	(i)	  		  	 The examiner’s list of errors is made available in the examination report sent to the Company. Given that the examination was based on a sample of the Company’s
policies or claims rather than the whole universe of the Company’s Covered Policies or reported claims, the error list is not intended to provide a complete list of errors but is intended to indicate what information needs to be reviewed and
corrected throughout the Company’s book of Covered Policy business or claims information to ensure more complete and accurate reporting to the FHCF.

  

					
		 	19	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

	(4)	 Costs of the Examinations 

 The costs of the examinations shall be borne by the SBA. However, in order to remove any incentive for a Company to delay preparations for an examination, the SBA shall be reimbursed by the Company for any examination
expenses incurred in addition to the usual and customary costs, which additional expenses were incurred as a result of the Company’s failure, despite proper notice, to be prepared for the examination or as a result of a Company’s failure
to provide requested information. All requested information must be complete and accurate. The Company shall be notified of any administrative remedies which may be obtained under Chapter 120, Florida Statutes. 
 ARTICLE XIV - INSOLVENCY OF THE COMPANY 
 Company
shall notify the FHCF immediately upon becoming insolvent. Except as otherwise provided below, no covered loss reimbursements will be made until the FHCF has completed and closed its examination of the insolvent Company’s losses, unless an
agreement is entered into by the court appointed receiver specifying that all data and computer systems required for FHCF exposure and loss examinations will be maintained until completion of the Company’s exposure and loss examinations. Except
as otherwise provided below, in order to account for potential erroneous reporting, the SBA shall hold back 25% of requested loss reimbursements until the exposure and loss examinations for the Company are completed. Only those losses supported by
the examination will be reimbursed. Pursuant to Section 215.555(4)(g), Florida Statutes, the FHCF is required to pay the “net amount of all reimbursement moneys” due an insolvent insurer to the Florida Insurance Guaranty Association
(FIGA) for the benefit of Florida policyholders. For the purpose of this Contract, a Company is insolvent when an order of liquidation with a finding of insolvency has been entered by a court of competent jurisdiction. In light of the need for an
immediate infusion of funds to enable policyholders of insolvent companies to be paid for their claims, the SBA may enter into agreements with FIGA allowing exposure and loss examinations to take place immediately without the usual notice and
response time limitations and allowing the FHCF to make loss reimbursements (net of any amounts payable to the SBA from the Company or FIGA) to FIGA before the examinations are completed and before the response time expires for claims filing by
reinsurers and financial institutions, which have a priority interest in those funds pursuant to Section 215.555(4)(g), Florida Statutes. Such agreements must ensure the availability of the necessary records and adequate security must be
provided so that if the FHCF determines that it overpaid FIGA on behalf of the Company, or if claims are filed by reinsurers or financial institutions having a priority interest in these funds, that the funds will be repaid to the FHCF by FIGA with
in a reasonable time. 
 ARTICLE XV - TERMINATION 
 The FHCF and the obligations of both parties under this Contract can be terminated only as may be provided by law or applicable rules. 
 ARTICLE
XVI - VIOLATIONS 
 Pursuant to the provisions of Section 215.555(10), Florida Statutes, any violation of the terms of this Contract
by the Company constitutes a violation of the Insurance Code of the State of the Florida. Pursuant to the provisions of Section 215.555(11), Florida Statutes, the SBA is authorized to take any action necessary to enforce any administrative
rules adopted pursuant to Section 215.555, Florida Statutes, and the provisions and requirements of this Contract. 
  

					
		 	20	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

 ARTICLE XVII- APPLICABLE LAW 
  

	(1)	 Applicable Law: This Contract shall be governed by and construed according to the laws of the State of Florida in respect of any matter relating to or
arising out of this Contract. 

	(2)	 Notice of Rights: Pursuant to Chapter 120, Florida Statutes, and the Uniform Rules of Procedure, codified as Chapters 28-101 through 28-111, F.A.C., a
person whose substantial interests are affected by a decision of the SBA regarding the FHCF may request a hearing within 21 days shall have waived his or her right to a hearing. The hearing may be a formal hearing or an informal hearing pursuant to
the provisions of Sections 120.569 and 120.57, Florida Statutes. The petition must be filed (received) in the office of the Agency Clerk, General Counsel’s Office, State Board of Administration of Florida, P.O. Box 13300, Tallahassee, FL
32317-3300 or 1801 Hermitage Blvd., Suite 100, Tallahassee, FL 32308, within the 21 day period. 

  

					
		 	21	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

 ARTICLE XVIII- REIMBURSEMENT CONTRACT ELECTIONS 
 Reimbursement Percentage 
 For purposes of determining reimbursement (if any) due the Company under
this Contract and in accordance with the Statute, the Company has the option to elect a 45% or 75% or 90% reimbursement percentage under this Contract. If the Company is a member of an NAIC group, all members must elect the same reimbursement
percentage, and the individual executing this Contract on behalf of the Company, by placing his or her initials in the box under (a) below, affirms that the Company has elected the same reimbursement percentage as all members of its NAIC group.
If the Company is an entity created pursuant to Section 627.351, Florida Statutes, the Company must elect the 90% reimbursement percentage. The Company shall not be permitted to change its reimbursement percentage during the Contract Year. The
Company shall be permitted to change its reimbursement percentage at the beginning of a new Contract Year, but may not reduce its reimbursement percentage if a Covered Event required the issuance of revenue bonds, until the bonds have been fully
repaid. 
 IMPORTANT NOTE: The FHCF issued revenue bonds in July of 2006 as a result of its liabilities for Covered Events under the
Contract Year effective June 1, 2005. As those bonds have not been fully repaid, the Company may not select a Reimbursement Percentage that is less than its selection under the prior Contract Year effective June 1, 2008. 
 The Reimbursement Percentage elected by the Company for the prior Contract Year effective June 1, 2008 was as follows: United Property and Casualty
Insurance Company - 90% 
  

	(a)	 NAIC Group Affirmation: Initial the following box if the Company is part of an NAIC Group: 

  

											
		 		 		 		  		  	
		 		 	 	 		  		  	
		 		 	 	 		  		  	
		 		 	 	 		  		  	
		 		 		 		  		  	

	(b)	 Reimbursement Percentage Election: The Company hereby elects the following Reimbursement Percentage for the Contract Year from 12:00:01 a.m., Eastern
Time, June 1, 2009, to 12:00 a.m., Eastern Time, May 31, 2010, (the individual executing this Contract on behalf of the Company shall place his or her initials in the box to the left of the percentage elected for the Company):

  

																							
	 	  	45%	  	OR	  		  	 	  	75%	  	OR	  		  	 	  	90%	  		  	

 Reporting Exposure for a Single Structure, with a Mix of Commercial Habitational and Commercial
Non-Habitational Exposure, Written on a Commercial Policy 
 This section is applicable to all Companies which either have exposure for
single structures with a mix of commercial habitational and commercial non-habitational exposure written under a Commercial Policy, or have the authority to write such policies. If the Company does not have the authority to write this type of
exposure, this section does not apply; initial the N/A box on the next page, which completes this ARTICLE. If the Company does write, or has the authority to write, this type of exposure, please read and complete the remainder
of this ARTICLE. 
  

					
		 	22	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

 Commercial-Residential Class Code 
 If a single structure is used for both habitational and non-habitational purposes and the structure has a commercial-residential class code (based on a classification plan on file with and
reviewed by the Administrator), the entire exposure for the structure should be reported to the FHCF under the Data Call, and the FHCF will reimburse losses for the entire structure as well. 
 Commercial Non-Residential/Business Class Code 
 If a single structure is used for both habitational and non-habitational purposes and the structure has a commercial non-residential or business class code (based on a classification plan on file with and reviewed by the Administrator), the
habitational portion of that structure should be identified and reported to the FHCF under the Data Call. 
 However, in recognition of the
unusual nature of commercial structures with incidental habitational exposure and the hardship some companies may face in having to carve out such incidental habitational exposure, as well as the losses to such structures, the FHCF will accommodate
these companies by allowing them to exclude the entire exposure for the single structure from their Data Call submission, providing the following two conditions are met: 

	(1)	 The decision to not carve out and report the incidental habitational exposure shall apply to all such structures insured by the Company; and

	(2)	 If the incidental habitational exposure is not reported to the FHCF, the Company agrees it shall not report losses to the structure and the FHCF shall not
reimburse any losses to the structure. 

 Initial the CARVING box below if the Company is able to carve out and
report its incidental habitational exposure, OR, if this requirement presents a hardship, the Company must communicate its decision to not carve out and to not report the incidental exposure by having the individual executing this Contract on
behalf of the Company placing his or her initials in the NOT CARVING box below. If the Company does not currently write such policies, but has the authority to write such policies after the start date of this Contract, the decision to carve
or not carve out the incidental habitational exposure must be indicated below. 

																					
		 		 	 	  	  
 OR
  
	  		  	 	  	  
 OR
  
	  		  	 	  		  	
		 		 	CARVING	  		  		  	 NOT CARVING
	  		  		  	NA	  		  	

 By initialing the CARVING or NOT CARVING box above, the Company is making an irrevocable
decision for the corresponding Contract Year Data Call submission and any subsequent resubmissions. 
  

			
	 Important Note:
	 	 Since this election will impact your Data Call submission, please share this decision with the individual(s) responsible for compiling your Data Call
submission.

 Additional Living Expense (ALE) Written as Tbne Element Coverage 
 If your Company writes Covered Policies that provide ALE coverage on a time element basis (i.e. coverage is based on a specific period of time as opposed
to a stated dollar limit), you must initial the ‘Yes – Time Element ALE’ box below. If your Company does not write time element ALE coverage, initial ‘No – Time Element ALE’ box below. 
  

																			
		 		 		 	 	  	  
 OR
  
	  		  	 	  		  		  	
		 		 		 	 Yes – Time
 Element ALE
	  		  		  	 No – Time
 Element ALE
	  		  		  	

  

					
		 	23	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

 ARTICLE XIX – SIGNATURES 
  

									
	Approved by:	 	
			
	 Florida Hurricane Catastrophe Fund
	 		 	
	 By:
	 	 State Board of Administration of the State of Florida
	 		 		 	
					
	 By:
	 	  
	 		 	  
	 	
		 	 Executive Director
	 		 	Date	 	
	
	 Approved as to legality:

					
	 By:
	 	  
	 		 	  
	 	
		 	 General Counsel
	 		 	Date	 	
					
		 	 United Property and Casualty Insurance Company
	 		 		 	
			
		 	  
	 	
		 	Typed/Printed Name and Title	 	
					
	 By:
	 	  
	 		 	  
	 	
		 	Signature	 		 	Date	 	

  

					
		 	24	 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

					
	

	 	 STATE BOARD OF ADMINISTRATION
 OF FLORIDA
  
 1801
HERMITAGE BOULEVARD
 TALLAHASSEE, FLORIDA 32308
 (850) 488-4406
  
 POST OFFICE BOX 13300
 32317-3300
	  	 CHARLIE CRIST
 GOVERNOR
 AS CHAIRMAN
  
 ALEX SINK
 CHIEF FINANCIAL OFFICER
 AS TREASURER
  
 BILL McCOLLUM
 ATTORNEY GENERAL
 AS SECRETARY
  
 ASH WILLIAMS
 EXECUTIVE DIRECTOR & CIO

	  
 ATTENTION:
	 	  
 THIS ADDENDUM MUST BE COMPLETED, SIGNED, AND
RETURNED BY ALL COMPANIES EXECUTING A REIMBURSEMENT CONTRACT REGARDLESS OF CHOICE TO ACCEPT OR REJECT THIS OPTIONAL COVERAGE

			
		 	 ADDENDUM NO. 1
 to
 REIMBURSEMENT CONTRACT
 Effective: June 1, 2009
 (Contract)
  
 between
  
 UNITED PROPERTY AND CASUALTY INSURANCE COMPANY
 St. Petersburg, FL
 (Company)

 
 NAIC # 10969
  
 and
	  	
	
	 THE STATE BOARD OF ADMINISTRATION OF THE STATE OF FLORIDA (SBA) WHICH ADMINISTERS THE FLORIDA HURRICANE CATASTROPHE
FUND (FHCF)
  
 It is Hereby Agreed, effective at
12:00:01 a.m., Eastern Time, June 1, 2009, that this Contract shall be amended as follows:
  
 TEMPORARY EMERGENCY OPTIONS FOR ADDITIONAL COVERAGE PURSUANT TO SECTION 215.555(16), FLORIDA STATUTES.
  
 Pursuant to Section 215.555(16), Florida Statutes, the Temporary Emergency Options for Additional Coverage (TEACO)
provision allows the Company to select additional FHCF reimbursement coverage below its mandatory FHCF coverage layer under the Reimbursement Contract. The optional coverage provided in this Addendum No. 1 expires on May 31, 2010. Coverage
associated with TEACO shall otherwise be consistent with terms and conditions as relates to the Reimbursement Contract including, but not limited to, definitions, coverage for Covered Policies as defined, exclusions, loss reporting, and examination
procedures.
  
 To be eligible for this optional coverage,
the Company must return a fully executed Addendum No. 1 (two originals) no later than 5 p.m., Central Time, June 1, 2009. New Participants, as defined in Article V of the Contract, must return a fully executed Addendum No. 1
(two

  

					
		 	1	 	FHCF-2009K-1
		 		 	Rule 19-8.010, F.A.C.

 
originals) within thirty days of writing its first Covered Policy and prior to a Loss Occurrence, as both terms are defined in Article V of the Contract,
under which the company would be eligible for reimbursements under the Contract. Any Company failing to meet the applicable deadline shall not be eligible for optional coverage under Addendum No. 1. 
 I. TEACO Coverage 
 The Company may
purchase its mandatory FHCF premium share of coverage underneath its FHCF retention in excess of one of three industry retention levels, which are specified as $3 billion, $4 billion, or $5 billion. The price for the layer of coverage below its
mandatory FHCF coverage is 75 cents for each dollar of coverage for the Company’s share of the layer associated with a $5 billion industry retention, 80 cents for each dollar of coverage for the Company’s share of the layer associated with
the $4 billion industry retention, or 85 cents for each dollar of coverage for the Company’s share of the layer of coverage associated with the $3 billion industry retention. The Company’s TEACO coverage shall be on an occurrence basis,
and the premium for coverage will include one reinstatement. The Company’s TEACO retention shall replace the Company’s mandatory FHCF retention when it selects a TEACO option. 
 The SBA shall reimburse the Company for 45 percent, 75 percent, or 90 percent of its losses from each Covered Event in excess of the
Company’s TEACO retention, plus 5 percent of the reimbursed losses to cover loss adjustment expense, limited in total to the amount of TEACO coverage purchased by the Company. The reimbursement percentage shall be the same as the coverage level
selected by the Company under its Reimbursement Contract. The Company’s maximum reimbursement under its TEACO option shall be its mandatory FHCF premium share of two times the difference between the industry retention calculated under
Section 215.555(2)(e), Florida Statutes, and the $3 billion, $4 billion, or $5 billion industry TEACO retention based on the Company’s selection of the TEACO option. 
 The full limit of the TEACO coverage purchased shall apply only to each of the Company’s two largest Covered Events. The TEACO coverage does not apply to other Covered Events resulting in
losses. 
 II. TEACO Premium 
 The Company’s TEACO premium shall be calculated based on its share of the mandatory FHCF reimbursement premium. Total TEACO premium shall be calculated based on the assumption that all insurers entering into Reimbursement Contracts
also accepted the TEACO option: 
  

	 	A.	 The industry TEACO premium associated with the $3 billion retention option would be equal to 85% of the difference for the coverage between the industry
retention level calculated under Section 2l5.555(2)(e), Florida Statutes, and the $3 billion industry TEACO retention level. 

	 	B.	 The industry TEACO premium associated with the $4 billion retention option would be equal to 80% of the difference for the coverage between the industry
retention level calculated under Section 215.555(2)(e), Florida Statutes, and the $4 billion industry TEACO retention level. 

	 	C.	 The industry TEACO premium associated with the $5 billion retention option would be equal to 75% of the difference for the coverage between the industry
retention level calculated under Section 215.555(2)(e), Florida Statutes, and the $5 billion industry TEACO retention level. 

  

					
		 	2	 	FHCF-2009K-1
		 		 	Rule 19-8.010, F.A.C.

 The TEACO premium shall be due and payable in three installments on August 1, 2009,
on October 1, 2009, and on December 1, 2009. 
 III. TEACO Retention 
 The TEACO retention is the amount of losses below which a TEACO Company is not entitled to reimbursement from the FHCF under the TEACO coverage option. 
 The TEACO retention multiple for each TEACO coverage option shall be calculated by dividing $3 billion, $4 billion, or $5 billion by the
total estimated mandatory FHCF reimbursement premium assuming all insurers selected the 90% coverage option. The TEACO retention multiple shall be used for determining an insurer’s retention if the insurer has selected a TEACO option. The TEACO
retention multiples outlined above shall be adjusted to reflect the coverage level selected by the Company under its Reimbursement Contract. For insurers electing the 90 percent coverage level, the adjusted retention multiple is 100 percent of the
amount determined under the preceding paragraph. For insurers electing the 75 percent coverage level, the adjusted retention multiple is 120 percent of the amount determined under the preceding paragraph. For insurers electing the 45 percent
coverage level, the adjusted retention multiple is 200 percent of the amount determined under the preceding paragraph. 
 IV. Liability of the FHCF 

 The liability of the FHCF with respect to all TEACO addenda shall not exceed an amount equal to two times the difference
between the industry retention level calculated under Section 215.555(2)(e), Florida Statutes, and the $3 billion, $4 billion, or $5 billion industry TEACO retention level options actually selected, but in no event may the FHCF’s
obligation exceed the actual claims-paying capacity of the FHCF plus the additional TEACO capacity provided for under Section 2l5.555(16)(g), Florida Statutes. 
 The additional capacity shall apply only to the additional coverage provided by the TEACO option and shall not otherwise affect any insurer’s reimbursement from the FHCF. 
 V. Coordination of Coverage 
 Reimbursement amounts under TEACO shall not be reduced by reinsurance paid or payable to the Company from sources other than the FHCF. 
 The TEACO coverage shall be in addition to all other coverage provided by the SBA under the Company’s Reimbursement Contract and shall be in addition to the claims-paying capacity of the FHCF as defined in
Section 21 5.555(4)(c) 1., Florida Statutes. 
 The TEACO coverage selected is irrevocable and shall not reduce,
overlap, or duplicate coverage otherwise provided for in the Reimbursement Contract or offset any co-payments. 
  

					
		 	3	 	FHCF-2009K-1
		 		 	Rule 19-8.010, F.A.C.

 VI. Addendum No. 1 TEACO Coverage Election 
 ALL COMPANIES EXECUTING A REIMBURSEMENT CONTRACT MUST INDICATE ITS TEACO COVERAGE PROVIDED BELOW THE FHCF RETENTION BY
SELECTING ONE OF THREE TEACO RETENTION LEVELS OR REJECT ALL SUCH COVERAGE. IF ADDENDUM NO. 1 IS RETURNED WITHOUT A TEACO RETENTION SELECTED, IT SHALL BE DEEMED BY THE STATE BOARD OF ADMINISTRATION TO BE A CHOICE TO REJECT TEACO COVERAGE. 

If your Company does not want to purchase any TEACO coverage, print “No Coverage” on the line below and
initial the box. 
  

									
		 		 		  	 	  	
		 	  
	 		  	  	
		 		 		  	  	

 If your company elects to purchase TEACO coverage, select a TEACO
retention level option by initialing the applicable box below. 
  

									
	 	 		 	 	 		 	 
	 	 		 	 	 		 	 
	 	 		 	 	 		 	 
	 Company selects $3 billion  
 TEACO Retention Option  
	 	  OR    	 	Company selects $4 billion TEACO Retention Option	 	  OR    	 	Company selects $5 billion TEACO Retention Option

 VII. Signatures 
  

									
		 		  	  
	 		 	
		 		  	 United Property and Casualty Insurance Company
	 	
					
		 	 By:
	  	  
	 	  
	 	
		 		  	Typed/Printed Name and Title	 	 Date
	 	
			
		 	 Approved by:
	 	
			
		 	 Florida Hurricane Catastrophe Fund
	 	
		 	 By:
	  	 State Board of Administration of the State of Florida
	 	
					
		 	 By:
	  	  
	 	  
	 	
		 		  	Executive Director	 	 Date
	 	
			
		 	 Approved as to legality:
	 	
					
		 	 By:
	  	  
	 	  
	 	
		 		  		 	 Date
	 	
		 		  	 General Counsel
	 		 	

  

					
		 	4	 	FHCF-2009K-1
		 		 	Rule 19-8.010, F.A.C.

					
	 

	  	 STATE BOARD OF ADMINISTRATION
 OF FLORIDA
  
 1801
HERMITAGE BOULEVARD
 TALLAHASSEE, FLORIDA 32308
 (850) 488-4406
  
 POST OFFICE BOX 13300
 32317-3300
	  	 CHARLIE CRIST
 GOVERNOR
 AS CHAIRMAN
  
 ALEX SINK
 CHIEF FINANCIAL OFFICER
 AS TREASURER
  
 BILL McCOLLUM
 ATTORNEY GENERAL
 AS SECRETARY
  
 ASH WILLIAMS
 EXECUTIVE DIRECTOR & CIO

		
	ATTENTION:	  	THIS ADDENDUM MUST BE COMPLETED, SIGNED, AND RETURNED BY ALL COMPANIES EXECUTING A REIMBURSEMENT CONTRACT REGARDLESS OF CHOICE TO ACCEPT OR REJECT THIS OPTIONAL COVERAGE

	
	AMENDED ADDENDUM NO. 2
	to
	REIMBURSEMENT CONTRACT
	Effective: June 1, 2009
	(Contract)
	
	between
	
	UNITED PROPERTY AND CASUALTY INSURANCE COMPANY

					
		  	 St. Petersburg, FL
 (Company)
  
 NAIC#10969
  
 and
	  	

 THE STATE BOARD OF ADMINISTRATION OF THE STATE OF FLORIDA (SBA) WHICH
ADMINISTERS THE FLORIDA HURRICANE CATASTROPHE FUND (FHCF) 
 It is Hereby Agreed, effective at
12:00:01 a.m., Eastern Time, June 1, 2009, that this Contract shall be amended as follows: 
 TEMPORARY INCREASE IN
COVERAGE LIMIT OPTIONS FOR ADDITIONAL COVERAGE PURSUANT TO SECTION 215.555(17), FLORIDA STATUTES. 
 Pursuant to Section 215.555(17), Florida Statutes, the Temporary Increase in Coverage Limit (TICL) Options provision allows the Company to select additional FHCF reimbursement coverage above its mandatory FHCF coverage layer under the
Reimbursement Contract. The optional coverage selections provided in this Amended Addendum No. 2 expires on May 31, 2010. Coverage provided under TICL shall otherwise be consistent with terms and conditions as relates to the Reimbursement
Contract including, but not limited to, definitions, coverage for Covered Policies as defined, exclusions, loss reporting, and examination procedures. 
 To be eligible for this optional coverage, the Company must return a fully executed Amended Addendum No. 2 (two originals) no later than 5 p.m., Central Time, June 30, 2009. If the
Company fails to meet this deadline, the optional coverage layer selected by the Company under the original Addendum No. 2 shall be deemed to apply, unless the Company had selected the $11 

  

					
		 	1	 	FHCF-2009K-2A
		 		 	Rule 19-8.010, F.A.C.

 
or $12 billion layers of coverage, in which case the $10 billion layer of coverage shall be deemed, and the price for such coverage shall be as provided in
this Amended Addendum No. 2. 
 TICL coverage selected in this Amended Addendum No. 2 shall not be
in force for the Company for losses from any hurricane which occurs or had occurred, prior to the Company sending the Amended Addendum No. 2 to the Administrator if the Company did not select TICL coverage in the original Addendum No. 2.

 New Participants, as defined in Article V of the Contract, must return a fully executed Amended Addendum
No. 2 (two originals) within thirty days of writing its first Covered Policy and prior to a Loss Occurrence, as both terms are defined in Article V of the Contract, under which the company would be eligible for reimbursements under the
Contract. Any New Participant failing to meet the applicable deadline shall not be eligible for optional coverage under Amended Addendum No. 2. 
 I. TICL Coverage 
 The Company may purchase one of ten optional
coverages above its mandatory FHCF coverage provided for in the FHCF Reimbursement Contract. The TICL options allow the Company to purchase its mandatory FHCF premium share of one of the ten optional layers of coverage. The optional layers of
coverage above the mandatory FHCF coverage are $10 billion, $9 billion, $8 billion, $7 billion, $6 billion, $5 billion, $4 billion, $3 billion, $2 billion, or $1 billion. 
 The purchase of a TICL option increases the Company’s coverage under the Reimbursement Contract as calculated
pursuant to Section 215.555(4)(d)2., Florida Statutes. The Company’s increased coverage shall be the FHCF reimbursement premium multiplied by the TICL multiple. Each TICL coverage multiple shall be calculated by dividing $10 billion, $9
billion, $8 billion, $7 billion, $6 billion, $5 billion, $4 billion, $3 billion, $2 billion, or $1 billion by the aggregate mandatory FHCF premium under the Reimbursement Contract paid by all companies. 
 In order to determine the Company’s total limit of coverage, the Company’s TICL coverage multiple is added to
its regular Payout Multiple under the Reimbursement Contract. The total of these two multiples shall represent a number that, when multiplied by an insurer’s mandatory FHCF reimbursement premium under the Reimbursement Contract, defines the
Company’s total limit of FHCF reimbursement coverage for the Contract Year under the Reimbursement Contract and Amended Addendum No. 2. The SBA shall reimburse the Company for 45 percent, 75 percent, or 90 percent of its losses from each
Covered Event in excess of the Company’s FHCF Retention under the Reimbursement Contract, plus 5 percent of the reimbursed losses to cover loss adjustment expense, not to exceed the Company’s total limit of coverage as defined above. The
percentage shall be the same as the coverage level selected by the Company under its Reimbursement Contract. 
 II. TICL Premium

 The Company’s TICL premium shall be determined as specified in Sections 215.555(5) and (17),
Florida Statutes, as amended, and shall be due and payable in three installments on August 1, 2009, October 1, 2009, and December 1, 2009. 
  

					
		 	2	 	FHCF-2009K-2A
		 		 	Rule 19-8.010, F.A.C.

 III. Liability of the FHCF 
 Pursuant to Section 215.555(17)(g), Florida Statutes, the liability of the FHCF with respect to all TICL addenda
shall not exceed $10 billion and shall depend on the number of insurers that select the TICL optional coverage and the TICL coverage options selected. In no circumstance shall the liability of the FHCF exceed its actual claims-paying capacity as
defined in Section 215.555(2)(m), Florida Statutes. 
 The additional TICL capacity shall apply only to
the additional coverage provided under the TICL options and shall not otherwise affect any insurer’s reimbursement from the FHCF if the insurer chooses not to select a TICL option to increase its limit of FHCF coverage. 
 IV. Coordination of Coverage 
 Reimbursement amounts under TICL shall not be reduced by reinsurance paid or payable to the Company from sources other than the FHCF. 
 The TICL coverage shall be in addition to all other coverage provided by the FHCF under the Company’s Reimbursement
Contract or other Addenda to the Reimbursement Contract, and shall be in addition to the claims-paying capacity of the FHCF as defined in Section 215.555(4)(c)l., Florida Statutes, but only with respect to those insurers that select the TICL
coverage. 
 The TICL coverage selected is irrevocable and shall not overlap or duplicate coverage otherwise
provided for in the Reimbursement Contract, or any Addenda to the Reimbursement Contract, or offset any co-payments or retention amounts. 
 V. Addendum No. 2 TICL Coverage Election 
 ALL COMPANIES EXECUTING A REIMBURSEMENT
CONTRACT MUST INDICATE BELOW THE LEVEL OF OPTIONAL TICL COVERAGE SELECTED, IF ANY. IF THE COMPANY FAILS TO MEET THE JUNE 30, 2009 DEADLINE OR MEETS THIS DEADLINE BUT FAILS TO SELECTE AN OPTIONAL COVERAGE UNDER THIS AMENDED ADDENDUM, THE OPTIONAL
COVERAGE LAYER SELECTED BY THE COMPANY UNDER THE ORIGINAL ADDENDUM NO. 2 SHALL BE DEEMED TO APPLY, UNLESS THE COMPANY HAD SELECTED THE $11 OR $12 BILLION LAYERS OF COVERAGE, IN WHICH CASE THE $10 BILLION LAYER OF COVERAGE SHALL BE DEEMED. IF AMENDED
ADDENDUM NO. 2 IS RETURNED WITHOUT A TICL COVERAGE OPTION SELECTED, AND NO COVERAGE WAS SELECTED UNDER THE ORIGINAL ADDENDUM NO. 2, IT SHALL BE DEEMED BY THE STATE BOARD OF ADMINISTRATION TO BE A CHOICE TO REJECT TICL COVERAGE. 
  

					
		 	3	 	FHCF-2009K-2A
		 		 	Rule 19-8.010, F.A.C.

 If your Company does not want to purchase any TICL coverage, print
“No Coverage” on the line below and initial the box. 
  

									
		  		  		  	 	  	
		  	  
	  		  	 	  	
		  		  		  	 	  	

 By selecting an option below (initial the applicable box), the
Company is selecting its proportionate share based on its mandatory FHCF reimbursement premium to the total mandatory FHCF reimbursement premiums paid by all companies of the layer of optional coverage. 
  

													
	 	  		 	 	  		 	 	  		 	 
	 	  		 	 	  		 	 	  		 
	 	  		 	 	  		 	 	  		 
	 Company selects
 $1 billion TICL
 Coverage Option
	  	 OR  
	 	 Company selects
 $2 billion TICL
 Coverage Option

	  	 OR  
	 	 Company selects
 $3 billion TICL
 Coverage Option

	  	 OR  
	 	 Company selects

 $4 billion TICL
 Coverage Option

		  		 		  		 		  		 	
	 	  		 	 	  		 	 	  		 	 
	 	  		 	 	  		 	 	  		 	 
	 	  		 	 	  		 	 	  		 	 
	 Company selects
 $5 billion TICL
 Coverage Option
	  	 OR
	 	 Company selects
 $6 billion TICL
 Coverage Option

	  	 OR
	 	 Company selects
 $7 billion TICL
 Coverage Option

	  	 OR
	 	 Company selects

 $8 billion TICL
 Coverage Option

		  		 		  		 		  		 	
	 	  		 	 	  		 		  		 	
	 	  		 	 	  		 		  		 	
	 	  		 	 	  		 		  		 	
	 Company selects
 $9 billion TICL
 Coverage Option
	  	 OR
	 	 Company selects
 $10 billion TICL
 Coverage Option

	  		 		  		 	

  

					
		 	4	 	FHCF-2009K-2A
		 		 	Rule 19-8.010, F.A.C.

 VI. Signatures 
  

													
		 		 	  
	 		 		 		 	
		 		 	 United Property and Casualty Insurance Company
	 		 		 		 	
							
		 	 By:
	 	  
	 		 	  
	 		 	
		 		 	Typed/Printed Name and Title	 		 	                     Date
	 		 	
					
		 	Approved by:	 		 		 	
					
		 	 Florida Hurricane Catastrophe Fund
	 		 		 	
		 	 By:
	 	 State Board of Administration of the State of Florida
	 		 		 		 	
							
		 	 By:
	 	  
	 		 	  
	 		 	
		 		 	                     Date
	 		 	
		 	 Executive Director & CIO
	 		 		 	
					
		 	 Approved as to legality:
	 		 		 	
							
		 	 By:
	 	  
	 		 	  
	 		 	
		 		 		 		 	                     Date
	 		 	
		 		 	 General Counsel
	 		 		 		 	

  

					
		 	5	 	FHCF-2009K-2A
		 		 	Rule 19-8.010, F.A.C.

 ADDENDUM NO. 3 TO REIMBURSEMENT CONTRACT 
 This addendum was not applicable to UPCIC. 
  

					
		 		 	FHCF-2009K
		 		 	Rule 19-8.010 F.A.C.

					
	

	  	 STATE BOARD OF ADMINISTRATION
 OF FLORIDA
  
 1801
HERMITAGE BOULEVARD
 TALLAHASSEE, FLORIDA 32308
 (850) 488-4406
  
 POST OFFICE BOX 13300
 32317-3300
	  	 CHARLIE CRIST
 GOVERNOR
 AS CHAIRMAN
  
 ALEX SINK
 CHIEF FINANCIAL OFFICER
 AS TREASURER
  
 BILL McCOLLUM
 ATTORNEY GENERAL
 AS SECRETARY
  
 ASH WILLIAMS
 EXECUTIVE DIRECTOR & CIO

		
	 ATTENTION:
	  	 THIS ADDENDUM MUST BE COMPLETED, SIGNED, AND RETURNED BY ALL COMPANIES ELIGIBLE FOR COVERAGE UNDER THIS ADDENDUM REGARDLESS OF CHOICE TO ACCEPT OR REJECT
THIS OPTIONAL COVERAGE

					
			
		  	ADDENDUM NO. 4	  	
		  	to	  
		  	REIMBURSEMENT CONTRACT	  
		  	Effective: June 1, 2009	  
		  	(Contract)	  
		  	  
 between
	  

											
			
		 	 UNITED PROPERTY AND CASUALTY INSURANCE COMPANY
 St. Petersburg, FL
 (Company)
  
 NAIC # 10969
  
 and
	  	

 THE STATE BOARD OF ADMINISTRATION OF THE STATE OF FLORIDA (SBA) 
 WHICH ADMINISTERS THE FLORIDA HURRICANE CATASTROPHE FUND (FHCF) 
 It is Hereby Agreed, effective at 12:00:01 a.m., Eastern Time, June 1, 2009, that this Contract shall be amended
as follows: 
 ADDITIONAL COVERAGE OPTION (up to $10 million) PURSUANT TO SECTION 215.555(4)(b)4., FLORIDA
STATUTES. 
 Pursuant to Section 215.555(4)(b)4., Florida Statutes, certain Companies may select
additional FHCF reimbursement coverage of up to $10 million dollars. The additional premium to be charged for this additional reimbursement coverage shall be 50 percent of the additional reimbursement coverage provided, which shall include one
prepaid full reinstatement. The additional premium shall be due and payable in three equal installments on August 1, 2009, on October 1, 2009, and on December 1, 2009. 
 The minimum retention level that must be retained associated with this additional coverage layer is 30 percent of the
insurer’s surplus as of December 31, 2008, for each Covered Event. For an insurer which began writing property insurance in 2009 and did not have a surplus as of December 31, 2008, surplus shall be deemed to be the surplus reported to
the Office of Insurance 
  

					
		 	1	 	FHCF-2009K-4
		 		 	Rule 19-8.010, F.A.C.

 Regulation at the time the insurer received its Certificate of Authority.
This coverage is designed to apply a retention that triggers coverage prior to the insurer reaching its retention under the mandatory coverage level. The SBA will determine and pay, within 30 days or as soon as practicable after receiving Proof of
Loss Reports, the reimbursement amount due under this optional coverage based on losses paid by the Company. 
 The reimbursement percentage applicable to this additional coverage shall be 100 percent, which includes reimbursement for loss adjustment expense as provided under the Reimbursement Contract. Once the limit of coverage under this option is
exhausted, the insurer’s retention under the mandatory coverage will apply. 
 This additional
reimbursement coverage shall be in addition to all other coverage provided by the SBA under the Company’s Reimbursement Contract and shall be in addition to the claims-paying capacity of the FHCF as defined in Section 215.555(4)(c)l.,
Florida Statutes, but only with respect to those insurers that select the additional coverage option. Coverage provided in this additional coverage option shall otherwise be consistent with terms and conditions as relates to the Reimbursement
Contract including, but not limited to, definitions, coverage for Covered Policies as defined, exclusions, loss reporting, and examination procedures. 
 While this additional coverage shall not reduce, overlap, or duplicate coverage otherwise provided for in the Reimbursement Contract or offset any co-payments, the amount of coverage selected
herein is irrevocable. Any amount of additional coverage selected herein that would in effect overlap FHCF coverage otherwise provided for in the Reimbursement Contract, or any other Addenda to the Reimbursement Contract, shall be deemed by the FHCF
to shift above the highest level of coverage otherwise provided by the FHCF. 
 The claims-paying capacity
with respect to all other participating insurers, including eligible Companies that do not select the additional coverage option, shall be limited to their reimbursement premium’s proportionate share of the actual claims-paying capacity as
defined in Section 215.555(4)(c)1., Florida Statutes and as provided for under the terms of the Reimbursement Contract, plus any coverage provided under any other Addenda to the Reimbursement Contract. 
 The optional coverage provided in this Addendum expires on May 31, 2010. To be eligible for this optional coverage,
the Company must return a fully executed Addendum No. 4 (two originals) no later than 5 p.m., Central Time, June 30, 2009. A Company failing to meet the applicable deadline shall not be eligible for optional coverage under Addendun
No. 4 for the 2009 Contract Year. Furthermore, there shall be no coverage under this Addendum for any Loss Occurrence, as defined in Article V of the Contract and under which the Company would be eligible for reimbursements under the Contract,
that occurs prior to the FHCF receiving the fully executed Addendum No.4 (original copies). 
 New
Participants, as defined in Article V of the Contract, must return a fully executed Addendum No. 4 (two originals) within thirty days of writing its first Covered Policy and prior to a Loss Occurrence under which the company would be eligible
for reimbursements under the Contract. A Company failing to meet the applicable deadline shall not be eligible for optional coverage under Addendum No. 4 for the 2009 Contract Year. 
 ALL COMPANIES EXECUTING A REIMBURSEMENT CONTRACT AND ELIGIBLE FOR THIS ADDITIONAL COVERAGE MUST INDICATE BELOW THE AMOUNT
OF ADDITIONAL COVERAGE SELECTED, IF ANY. 
  

					
		 	2	 	FHCF-2009 K-4
		 		 	Rule 19-8.010, F.A.C.

 If your Company does not wish to purchase the additional coverage under
this Addendum, print “No Coverage” on the line below and initial the box. 
  

									
		 		 		  		  	
		 		 		  	 	  	
		 	 	 		  	 	  	
		 		 		  	 	  	
		 		 		  	 	  	
		 		 		  		  	

 If your Company is eligible for the coverage under this Addendum
and elects to purchase this coverage, indicate the amount of additional coverage up to $10 million (there is no additional coverage available in excess of $10 million) on the line below: 
 $10 million 
 IF THIS ADDENDUM NO. 4 IS RETURNED WITHOUT THE BLANK SPACE IMMEDIATELY ABOVE FILLED IN WITH A DOLLAR AMOUNT, IT SHALL BE DEEMED BY THE STATE BOARD OF ADMINISTRATION TO BE A CHOICE TO REJECT THE
ADDITIONAL COVERAGE. 
  

									
		 		 	  
	  		 	
		 		 	United Property and Casualty Insurance Company	  		 	
					
		 	By:	 	  
	  	  
	 	
		 		 	Name/Title	  	Date	 	
		
		 	 Approved by:

		
		 	Florida Hurricane Catastrophe Fund
		 	By:	 	State Board of Administration of the State of Florida	 	
					
		 	By:	 	  
	  	  
	 	
		 		 		  	Date	 	
		 		 	Executive Director & CIO	  		 	
		
		 	Approved as to legality:
					
		 	By:	 	  
	  	  
	 	
		 		 		  	Date	 	
		 		 	 General Counsel
	  		 	

  

					
		 	3	 	FHCF-2009K-4
		 		 	Rule 19-8.010, F.A.C.

					
	 

	  	 STATE BOARD OF ADMINISTRATION
 OF FLORIDA
  
 1801
HERMITAGE BOULEVARD
 TALLAHASSEE, FLORIDA 32308
 (850) 488-4406
  
 POST OFFICE BOX 13300
 32317-3300
	  	 CHARLIE CRIST
 GOVERNOR
 AS CHAIRMAN
  
 ALEX SINK
 CHIEF FINANCIAL OFFICER
 AS TREASURER
  
 BILL McCOLLUM
 ATTORNEY GENERAL
 AS SECRETARY
  
 ASH WILLIAMS
 EXECUTIVE DIRECTOR & CIO

			
		  	ADDENDUM NO. 5	  	
		  	to	  	
			
		  	REIMBURSEMENT CONTRACT	  	
			
		  	Effective: June 1, 2009	  	
		  	(Contract)	  	
			
		  	between	  	

							
				
		  		  	 UNITED PROPERTY AND CASUALTY INSURANCE COMPANY
 St. Petersburg, FL
 (Company)
  
 NAIC # 10969
  
 and
	  	

 THE STATE BOARD OF ADMINISTRATION OF THE STATE OF FLORIDA (SBA) 
 WHICH ADMINISTERS THE FLORIDA HURRICANE CATASTROPHE FUND (FHCF) 
 It is Hereby Agreed, effective at 12:00:01 a.m., Eastern Time, June 1, 2009, that this Contract shall be amended
as follows: 
 ARTICLE JV - LIABILITY OF THE FHCF 
  

	 	(4)	 Upon the occurrence of a Covered Event, the SBA shall evaluate the potential losses to the FHCF and the FHCF’s capacity at the time of the event. The
initial Projected Payout Multiple used to reimburse the Company for its losses shall not exceed the Projected Payout Multiple as calculated based on the capacity needed to provide the FHCF’s mandatory coverage and the Additional Coverage Option
(up to $10 million) pursuant to Section 215.555(4)(b)4., Florida Statutes, as provided under Addendum No.4 to this Contract. The SBA shall make adjustments to the Projected Payout Multiple in order to reimburse the optional Temporary Increase
in Coverage Limit (TICL) Options coverage based on the SBA’s ongoing evaluation of potential losses and capacity. If it appears that the Estimated Claims-Paying Capacity may be exceeded, the SBA shall reduce the published factors or multiples
for determining each participating insurer’s projected payout uniformly among all insurers to reflect the Estimated Claims-Paying Capacity. 
	 

	 	(6)	 After the end of the calendar year, the SBA shall notify insurers of the estimated Borrowing Capacity and the Balance of the Fund as of December 31. In May
and October of each year, the SBA shall publish in the Florida Administrative Weekly a statement of the FHCF’s estimated Borrowing Capacity, Estimated Claims-Paying Capacity, and the projected Balance of the Fund as of December 31.

	 

  

					
		 	1	 	FHCF-2009K-5
		 		 	Rule 19-8.010 F.A.C.

 Article V(16) and (28)(b)]. shall be amended as follows: 
 ARTICLE V - DEFINITIONS 
  

	 	(16)	 Formula or the Premium Formula 
	 

 This term means the Formula approved by the SBA for the
purpose of determining the Actuarially Indicated Premium to be paid to the FHCF. The Premium Formula is defined as an approach or methodology which leads to the creation of premium rates. The resulting rates are therefore incorporated as part of the
Premium Formula. The formula, shall, pursuant to Section 215.555(5)(b), Florida Statutes, include a cash build-up factor in the amount specified therein. 

	 	(28)	 Retention 
	 

 (b) When the Company experiences covered losses from
more than two Covered Events during the Contract Year, the Company’s full Retention shall be applied to each of the two Covered Events causing the largest covered losses for the Company. For each other Covered Event resulting in covered losses,
the Company’s Retention shall be reduced to one-third of its full Retention and applied to all other Covered Events. 
  

	 	1.	 All reimbursement of covered losses for each Covered Event shall be based on the Company’s full Retention up to January 1 of the Contract Year.
Adjustments to reflect a reduction to one-third of the full Retention shall be made on or after January 1 of the Contract Year provided the Company reports its losses as specified in this Contract. 
	 

 Article X(3)(c)1. shall be amended as follows: 
 ARTICLE X - REPORTS AND REMITTANCES 
 (c) Loss Reimbursement Calculations 

	 	1.	 In general, the Company’s paid Ultimate Net Losses must exceed its full FHCF Retention for a specific Covered Event before any reimbursement is payable from
the FHCF for that Covered Event. As described in Article V(28)(b), Retention adjustments will be made on or after January 1 of the Contract Year. No interest is payable on additional payments to the Company due to this type of Retention
adjustment. Each Company sustaining reimbursable losses will receive the amount of reimbursement due under the Contract up to the amount of the Company’s payout. If more than one Covered Event occurs in any one Contract Year, any reimbursements
due from the FHCF shall take into account the Company’s Retention for each Covered Event. However, the Company’s reimbursements from the FHCF for all Covered Events occurring during the Contract Year shall not exceed, in aggregate, the
Projected Payout Multiple or Payout Multiple, as applicable, times the individual Company’s Reimbursement Premium for the Contract Year. 
	 

  

					
		 	2	 	FHCF-2009K-5
		 		 	Rule 19-8.010 F.A.C.

							
	 Approved by:
	 	
		
	Florida Hurricane Catastrophe Fund	 	
	By:	 	State Board of Administration of the State of Florida	 	
				
	By:	 	  
	  	  
	 	
		 		  	Date	 	
		 	Executive Director & CIO	  		 	
		
	Approved as to legality:	 	
				
	By:	 	  
	  	  
	 	
		 		  	Date	 	
		 	 General Counsel
	  		 	
			
		 	United Property and Casualty Insurance Company	 	
			
		 	  
	 	
		 	       Typed/Printed Name and Title
	 	
				
	By:	 	  
	  	  
	 	
		 	Signature	  	Date	 	

  

					
		 	3	 	FHCF-2009K-5
		 		 	Rule 19-8.010 F.A.C.

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