Document:

exv10w152

EXHIBIT 10.152

CASUALTY EXCESS OF LOSS

REINSURANCE AGREEMENT

NO. RAM Re SumCX — 2006

EFFECTIVE JANUARY 1, 2006

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(hereinafter referred to as the “Subscribing Reinsurer”)

 

 

CASUALTY EXCESS OF LOSS REINSURANCE AGREEMENT NO. RAM Re SumCX — 2006

	 	 	 	 	 	 	 
	ARTICLE	 	CONTENTS	 	PAGE
	 

	 	PREAMBLE
	 	 	1	 
	I

	 	BUSINESS COVERED
	 	 	1	 
	II

	 	EFFECTIVE DATE AND TERMINATION
	 	 	1	 
	III

	 	TERRITORY
	 	 	2	 
	IV

	 	LIMIT AND RETENTION
	 	 	2	 
	V

	 	WARRANTIES
	 	 	2	 
	VI

	 	ULTIMATE NET LOSS
	 	 	2	 
	VII

	 	LOSS IN EXCESS OF POLICY LIMITS
	 	 	3	 
	VIII

	 	EXTRA CONTRACTUAL OBLIGATIONS
	 	 	3	 
	IX

	 	EXCLUSIONS
	 	 	4	 
	X

	 	SPECIAL ACCEPTANCES
	 	 	6	 
	XI

	 	LOSS OCCURRENCE
	 	 	7	 
	XII

	 	REINSURANCE PREMIUM
	 	 	7	 
	XIII

	 	REPORTS AND REMITTANCES
	 	 	8	 
	XIV

	 	LOSS ADJUSTMENTS AND SETTLEMENTS
	 	 	8	 
	XV

	 	SALVAGE AND SUBROGATION
	 	 	9	 
	XVI

	 	FEDERAL TERRORISM EXCESS RECOVERY CLAUSE
	 	 	9	 
	XVII

	 	ACCESS TO RECORDS
	 	 	10	 
	XVIII

	 	DIVIDENDS AND TAXES
	 	 	11	 
	XIX

	 	FEDERAL EXCISE TAX
	 	 	11	 
	XX

	 	GOVERING LAW
	 	 	11	 
	XXI

	 	CURRENCY
	 	 	12	 
	XXII

	 	OFFSET
	 	 	12	 
	XXIII

	 	ERRORS OR OMISSIONS
	 	 	12	 
	XXIV

	 	INSOLVENCY
	 	 	12	 
	XXV

	 	MEDIATION
	 	 	13	 
	XXVI

	 	ARBITRATION
	 	 	14	 
	XXVII

	 	SPECIAL CONDITIONS
	 	 	16	 
	XXVIII

	 	THIRD PARTIES
	 	 	17	 
	XXIX

	 	UNAUTHORIZED REINSURENCE
	 	 	18	 
	XXX

	 	SERVICE OF SUIT
	 	 	19	 
	XXXI

	 	CONFIDENTIALITY CLAUSE
	 	 	20	 
	XXXII

	 	AMENDMENTS
	 	 	21	 
	XXXIII

	 	SEVERABILITY
	 	 	21	 
	XXXIV

	 	INTEREST PENALTY
	 	 	21	 
	XXXV

	 	ASSIGNMENT
	 	 	22	 
	XXXVI

	 	ENTIRE AGREEMENT
	 	 	22	 

ATTACHMENTS:

EXHIBIT A — FIRST EXCESS OF LOSS

EXHIBIT B — SECOND EXCESS OF LOSS 

EXHIBIT C — THIRD EXCESS OF LOSS

APPENDIX A — DEFINITION OF COMPANY

APPENDIX B — FORTUNE’S GLOBAL 500 LIST

 

 

APPENDIX C — PHARMACEUTICAL/MEDICAL RISKS

INSOLVENCY FUNDS EXCLUSION CLAUSE.

NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY — REINSURANCE — U.S.A.

NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY — REINSURANCE — CANADA.

NUCLEAR INCIDENT EXCLUSION CLAUSE — REINSURANCE — NO. 4.

 

 

CASUALTY EXCESS OF LOSS

REINSURANCE AGREEMENT

No. RAM Re SumCX — 2006

(hereinafter referred to as the “Agreement”)

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(hereinafter referred to as the “Subscribing Reinsurer”)

ARTICLE I — BUSINESS COVERED

	A.	 	The Subscribing Reinsurer shall indemnify the Company on an excess of loss basis in respect
of the Company’s Ultimate Net Loss paid or to be paid by the Company as a result of losses
occurring during the term of the Agreement for Policies in force as of January 1, 2006, and
new and renewal Policies becoming effective on or after said date, subject to the terms and
conditions contained herein.
	 
	B.	 	This Agreement is solely between the Company and the Subscribing Reinsurer, and nothing
contained in this Agreement shall create any obligations or establish any rights against the
Subscribing Reinsurer in favor of any person or entity not a party hereto.
	 
	C.	 	The term “Policies” shall mean each of the Company’s binders, policies and contracts of
insurance or reinsurance on the business covered hereunder.
	 
	D.	 	Under this Agreement, the indemnity for reinsured loss applies only to Workers Compensation
and Employers Liability business written by the Company, except as excluded under Article IX —
Exclusions of this Agreement, and classified as Summit Profit Center, (see Appendix A —
Definition of Profit Center).

ARTICLE II — EFFECTIVE DATE AND TERMINATION

	A.	 	This Agreement shall become effective with respect to losses occurring on and after at 12:01
a.m. Local Standard Time, January 1, 2006, and shall remain in full force until terminated.
This Agreement may be terminated at the close of any calendar year by either party giving to
the other 90 days prior written notice by certified mail of its intention to do so.
	 
	B.	 	During the running of such notice as stipulated in Paragraph A. above, the Subscribing
Reinsurer shall participate in business coming within the terms of this Agreement until the
date of termination of this Agreement,
	 
	C.	 	Upon termination of the Agreement, the Subscribing Reinsurer shall be liable for the losses
occurring prior to the date of termination; however, the Subscribing Reinsurer shall have no
liability for losses occurring subsequent to the termination of this Agreement

	Agreement No. RAM Re SumCX — 2006

1.

 

	D.	 	If this Agreement shall terminate while a loss covered hereunder is in progress, it is
agreed that, subject to the other conditions of this Agreement, the Subscribing Reinsurer
shall indemnify the Company as if the entire loss had occurred during the time this Agreement
is in force provided the loss covered hereunder started before the date of termination.

ARTICLE III — TERRITORY

The territorial limits of this Agreement shall be identical with those of the Company’s Policies.

ARTICLE IV — LIMIT AND RETENTION

	A.	 	The limits and retentions provided under this Agreement are as set forth in Exhibits A, B and
C attached hereto and made a part of this Agreement.
	 
	B.	 	The Company’s retention and the Subscribing Reinsurer’s limit of liability for each Loss
Occurrence, set forth in Section I of Exhibits A, B and C attached hereto and made part of
this Agreement, shall apply irrespective of the number of Policies affected or number of
hazards in one policy.
	 
	C.	 	Reinsurance of the Company’s retention, set forth in each Exhibit, shall not be deducted in
arriving at the Company’s Ultimate Net Loss herein.

ARTICLE V — WARRANTIES

Notwithstanding any other provision of this Agreement, Subscribing Reinsurers’ liability under
this Agreement shall be limited to a maximum of:

	1.	 	$5,000,000 Maximum Any One Life for Workers’ Compensation;
	 
	2.	 	Maximum Employers Liability limit $2,000,000.

ARTICLE VI — ULTIMATE NET LOSS

The term “Ultimate Net Loss” as used in this Agreement shall mean: (1) all amounts paid or due and
payable by the Company in the investigation, appraisal, adjustment, settlement, litigation, defense
or appeal, or payment of claims or judgments arising from each and every loss, and/or Loss
Occurrence for which the Company is or may be found liable under the Policies, less salvages and
subrogation recoveries and amounts recovered or recoverable under pooling agreements or other
reinsurances, whether collectible, or not “Ultimate Net Loss” includes, but is not limited to, the
following paid or payable amounts: loss adjustment expenses, defense costs, court costs,
supersedeas and appeal bond costs. Post or Prejudgment Interest and Delayed Damages, Attorneys Fees
and Expenses, Claim-Specific Declaratory Judgment Expenses, a pro rata share of salaries and
expenses of the Company’s or its affiliates’ field employees according to the time occupied in
adjusting, defending, and settling such loss, and expenses of all of the Company’s or its
affiliates’ officers and employees incurred in connection with the loss; (except that salaries of
officers and employees engaged in general management and located in the home office of the Company
or its affiliates and any office expense of the Company shall not be included), and all other costs
of investigation or litigation, (2) Extra Contractual Obligations (as defined in the Extra
Contractual Obligations Article, and (3) loss in excess of original Policy limits (as described in
the Loss in Excess of Original Policy Limits Article).

Agreement No. RAM Re SumCX — 2006

2.

 

“Claim-Specific Declaratory Judgment Expenses” shall be defined as fees and expenses incurred in
actions brought to determine whether the Company has a defense and/or indemnification obligation
for individual claims presented against Policies covered under this Agreement. Any Claim-Specific
Declaratory Judgment Expense shall be deemed to have been fully incurred on the same date as the
insured’s original loss (if any) giving rise to the action, unless otherwise provided for within
this Agreement.

The term “Attorneys’ Fees and Expenses” as used above, means the fees and expenses of attorneys,
including the fees and expenses of the Company’s or its affilliates’ in-house attorneys providing
legal advice on coverage questions and/or defending the Company in coverage litigation, and fees
and expenses of staff counsel in the defense of policyholder claims. Such Attorneys’ Fees and
Expenses for in-house attorneys and staff counsel shall be calculated at the rate for such
attorneys plus the expenses incurred by such attorneys, but excluding office expenses of the
Company and its affiliates and salaries and expenses of their other employees.

“Post or Prejudgment Interest or Delayed Damages” shall mean interest or damages added to a
settlement, verdict, award, or judgment based on the period of time prior to or after the
settlement, verdict, award, or judgment whether or not made part of the settlement, verdict,
award, or judgment.

Nothing in this Article shall be construed to mean that losses under this Agreement are not
recoverable until the Company’s Ultimate Net Loss has been ascertained. In the event a verdict or
judgment is reduced by an appeal or a settlement subsequent to the entry of the judgment, thereby
resulting in an ultimate saving on such verdict or judgment, or in the event a judgment is
reversed outright, the loss adjustment expense incurred in securing such final reduction or
reversal shall be prorated between the Reinsurers and the Company in the proportion that each
benefits from such reduction or reversal, and the expenses incurred up to the time of the original
verdict or judgment shall be added to the Ultimate Net Loss. In the event there is no reduction or
reversal of a verdict or judgment, the loss adjustment expense incurred in attempting to secure
such reduction or reversal shall be added to the Ultimate Net Loss.

ARTICLE VII — LOSS IN EXCESS OF POLICY LIMITS

This Agreement shall protect the Company within the limits hereof, for 90% of any Loss in excess
of the Company’s original Policy limit where Loss in excess of the limit has been incurred because
of a failure by the Company or by a third-party claims administrator to settle within the Policy
limit or by reason of alleged or actual negligence, fraud, or bad faith in rejecting an offer of
settlement or in defending or prosecuting litigation, including appeals, arbitration, or any
alternative dispute resolution or settlement discussions involving any claim.

However, the above paragraph shall not apply where the loss has been incurred due to the fraud of
a member of the Board of Directors or a Corporate Officer 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 or settlement of any claim covered hereunder.

With regard to excess of Policy limits, the word “Loss” shall mean any amounts for which the
Company would have been contractually liable to pay had it not been for the limit of the original
Policy. The date on which any Loss in excess of the Company’s original Policy limit is incurred by
the Company shall be deemed, in all circumstances, to be the date of the original Occurrence,
accident, casualty, disaster, loss occurrence or loss, as selected by the Company.

ARTICLE VIII — EXTRA CONTRACTUAL OBLIGATIONS

Agreement No. RAM Re SumCX — 2006

3.

 

This Agreement shall protect the Company within the limits hereof for 90% of Extra Contractual
Obligations. “Extra Contractual Obligations” are defined as those liabilities not covered under any
other provision of this Agreement, which arise from the handling of any claim on business covered
hereunder, such liabilities arising because of, but not limited to, the following: failure by the
Company or by a third party claims administrator to settle within the Policy limit, or by reason of
alleged or actual negligence, fraud or bad faith in rejecting an offer of settlement or in
defending or prosecuting litigation, including appeals, arbitration, or any alternative dispute
resolution or settlement discussions involving any claim.

The date on which any Extra Contractual Obligation is incurred by the Company shall be deemed, in
all circumstances, to be the date of the original Occurrence, loss occurrence, accident, casualty,
disaster, or loss, as selected by the Company.

However, this Article shall not apply where the loss has been incurred due to the fraud of a
member of the Board of Directors or a corporate officer 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 or settlement of any claim covered hereunder.

ARTICLE IX — EXCLUSIONS

THIS AGREEMENT DOES NOT COVER:

	A.	 	THE FOLLOWING GENERAL CATEGORIES

	 	1.	 	Ex-gratia payments.
	 
	 	2.	 	Loss or damage caused directly or indirectly by: (a) enemy attack by armed forces
including action taken by military, naval or air forces in resisting an actual or an
immediately impending enemy attack; (b) invasion; (c) insurrection; (d) rebellion; (e)
revolution; (f) intervention; (g) civil war; and (h) usurped power.
	 
	 	3.	 	Reinsurance assumed by the Company, except intercompany reinsurance.
	 
	 	4.	 	Business derived from any Pool, Association, including Joint Underwriting
Association, Syndicate, Exchange, Plan, Fund or other facility directly as a member,
subscriber or participant, or indirectly by way of reinsurance or assessments; provided
this exclusion shall not apply to Automobile or Workers Compensation assigned risks which
may be currently or subsequently covered hereunder.
	 
	 	5.	 	Pollution Liability as per the Company’s original Policies and endorsements except
when a judicial entity invalidates the Company’s exclusion or in any jurisdiction
whose regulatory authorities have prohibited the exclusion.
	 
	 	6.	 	Insolvency Funds as per the attached Insolvency Funds Exclusion Clause.
	 
	 	7.	 	Global Fortune 500 Risks as per the attached Appendix B.
	 
	 	8.	 	Pharmaceutical/Medical Risks per the attached Appendix C.
	 
	 	9.	 	Nuclear Incident Exclusion Clauses which are attached and made part of this Agreement:

	 	a.	 	Nuclear Incident Exclusion Clause — Liability — Reinsurance — U.S.A.
	 
	 	b.	 	Nuclear Incident Exclusion Clause — Liability — Reinsurance — Canada.
	 
	 	c.	 	Nuclear Incident Exclusion Clause — Reinsurance — No. 4.

Agreement No. RAM Re SumCX — 2006

4.

 

	B.	 	THE FOLLOWING INSURANCE COVERAGES

	 	1.	 	Fiduciary Liability.
	 
	 	2.	 	Surety and Credit insurance.
	 
	 	3.	 	Fidelity Bonds.
	 
	 	4.	 	Credit and Financial Guarantee.
	 
	 	5.	 	Securities and Exchange Liability.
	 
	 	6.	 	Malpractice insurance, Directors and Officers Liability insurance or any form of
Errors and Omissions or Professional Liability insurance, except as provided for under
the Company’s Underwriting Guidelines.
	 
	 	7.	 	Advertisers’, Broadcasters’ and Telecasters’ Liability as respects Personal Injury
Liability except as provided for under the Company’s Underwriting Guidelines.
	 
	 	8.	 	Kidnap, Extortion and Ransom Liability.
	 
	 	9.	 	Protection and Indemnity (Ocean Marine) except for hulls under 50 feet.
	 
	 	10.	 	Entertainment Business, defined as Feature Film and Major Motion Picture Studios,
Commercial Negative Film Coverages, Cast Coverage, Completion Bond and Television
Productions.

	C.	 	THE FOLLOWING RISKS AS RESPECTS WORKERS COMPENSATION AND EMPLOYERS
LIABILITY

	 	1.	 	Operations under the jurisdiction of the U.S. Longshoremen’s and Harbor Workers’
Act, the Jones Act and the Maritime Employers Liability Act except when written as
incidental coverages as defined in the Company’s Underwriting Guidelines.
	 
	 	2.	 	Operation of docks or wharves, other than small marinas or pleasure docks.
	 
	 	3.	 	Risks involving known exposure to asbestos.
	 
	 	4.	 	All railway operations except sidetrack agreements.
	 
	 	5.	 	Amusement parks, carnivals or circuses, except county or country fairs.
	 
	 	6.	 	Subaqueous operations.
	 
	 	7.	 	Mining.
	 
	 	8.	 	Demolition of buildings or structures in excess of three stories or 50 feet in height.
	 
	 	9.	 	Shoring, underpinning or moving of buildings or structures.
	 
	 	10.	 	Manufacture, sale, rental, lease, erection or repair of scaffolds.
	 
	 	11.	 	Construction of bridges over 50 feet, and tunnels or dams.

Agreement No. RAM Re SumCX — 2006

5.

 

	 	12.	 	a. 	 Manufacturers or importers of fireworks, fuses, or any substance, as defined and
noted below, intended for use as an explosive.

	 	b.	 	Loading of fireworks, fuses, or any explosive substance defined
below into containers for use as explosive objects, propellant charges or
detonation devices and the storage thereof.
	 
	 	c.	 	Manufacturers or importers of any product in which fireworks, fuses, or
any explosive substance defined below is an ingredient.
	 
	 	d.	 	Handling, storage, transportation or use of fireworks, fuses, or any
explosive substance defined below.

	 	 	 	NOTE: An explosive substance is defined as any substance manufactured for the express
purpose of exploding as differentiated from commodities used industrially and which are
only incidentally explosive.
	 
	 	13.	 	Manufacture, production, refining, storage, wholesale distribution or
transportation of natural or artificial fuel gas, butane, propane or liquefied
petroleum gases or gasoline, except when written as incidental coverages as defined in
the Company’s Underwriting Guidelines.
	 
	 	14.	 	Onshore and offshore gas and oil drilling operations.
	 
	 	15.	 	Ownership, maintenance or use of any airport or aircraft, including fueling, or any
device or machine intended for and/or aiding in the achievement of atmospheric flight,
projection or orbit except as respects corporate-owned aircraft with capacity of up to
four passengers.
	 
	 	16.	 	Municipalities, except for those with a population less than 25,000.
	 
	 	17.	 	Any actual or alleged liability whatsoever for any claim or claims in respect of
loss or losses directly or indirectly arising out of, resulting from or in consequence
of, or in any way involving asbestos, or any materials containing asbestos in whatever
form or quantity.

	D.	 	THE FOLLOWING RISKS AS RESPECTS TERRORISM
	 
	 	 	Terrorism losses arising from Airports, Bridges, Government Buildings, Nuclear Facilities,
Office Buildings over 25 stories, Security Services, Stadiums and Tunnels, Nuclear,
Biological and Chemical exposures, Explosive Manufacturing risks, Fertilizer mixing Plants,
Railroads, Amusement/Theme parks with greater than 5,000 person capacity, Distribution and
Manufacturing of weapons/munitions.
	 
	E.	 	The Company and the Subscribing Reinsurer have agreed on the Company’s Underwriting
Guidelines, as respects policies covered under this Agreement. The Company shall advise the
Reinsurer of any change in such Underwriting Guidelines.
	 
	F.	 	In the event the Company is inadvertently bound on any risk which is excluded under this
Agreement, the reinsurance provided under this Agreement shall apply to such risk until
discovery by the Company within its Home Office of the existence of such risk and for 45 days
thereafter or for the period required by statutes, and shall then cease unless within such
period, the Company has received from the Subscribing Reinsurer written notice of its approval
of such risk.

ARTICLE X — SPECIAL ACCEPTANCES

Agreement No. RAM Re SumCX — 2006

6.

 

	A.	 	Risks which are beyond the terms, conditions or limitations of this Agreement may be
submitted to each Subscribing Reinsurer identified on the attached Interests and Liabilities
Agreement for special acceptance hereunder. Upon receipt of approval from all Subscribing
Reinsurers, such acceptance shall bind each Subscribing Reinsurer for its respective share in
the interests and liabilities of said risk. A Subscribing Reinsurers’ failure to respond
within 2 full business days shall be deemed approval of a risk submitted for special
acceptance.
	 
	B.	 	When a risk is specially accepted, such risk shall be covered under the terms and conditions
of this Agreement, except as such terms shall be modified by such acceptance. Premiums and
losses derived from any special acceptance shall be included with other data for rating
purposes of this Agreement. Once a risk has been accepted under the provisions of this
Article, it will automatically be included at renewal unless there have been material changes
to the risk, in which case the risk will be resubmitted.

ARTICLE XI — LOSS OCCURRENCE

	 	A.	 	The term “Loss Occurrence” as used herein is defined as an accident or occurrence
or series of accidents or occurrences arising out of or caused by one event, except that
as respects occupational disease and cumulative trauma:
	 
	 	B.	 	As respects an occupational or other disease or cumulative injury under Workers
Compensation and Employers Liability, each case of an employee contracting any disease
for which the Company may be liable shall be considered a separate and distinct
occurrence and the date of each occurrence shall be deemed to be as follows:

	 	1.	 	If the case is compensable under the Workers Compensation Law or
any Occupational Disease Compensation Act, the date of the beginning of the
disability for which compensation is payable;
	 
	 	2.	 	If the case is not compensable under the Workers Compensation Law or any
Occupational Disease Compensation Act, the date of the disability due to said
disease actually began;
	 
	 	3.	 	Where claim is made after employment has ceased, then the date of the
cessation of employment shall be deemed to be the date of disability;
	 
	 	4.	 	Notwithstanding the foregoing, in the incidence of a sudden catastrophic
event not exceeding 24 hours in duration including traumatic injury or death, all
losses to all employers shall be deemed an occurrence.

ARTICLE XII — REINSURANCE PREMIUM

The rates set forth in Section 3 of the attached Exhibits A, B and C, shall be applied to the
Company’s Subject Earned Premium for the business covered as stated in Paragraph D. of Article I —
Business Covered.

	A.	 	The term “Subject Earned Premium” as used herein will be based on Standard Premium less
approved premium discounts.
	 
	B.	 	The term “Standard Premium” is determined as defined in NCCI’s Basic Manual. It is determined
on the basis of authorized rates, disease loadings, nonrateable elements, aircraft

Agreement No. RAM Re SumCX — 2006

7.

 

seat surcharges, premium for increase limits of liability, experience rating
modification, applicable schedule rating modifications, minimum premiums and other
approved rate modifications. It excludes expense constant. Terrorism Risk Insurance Act
of 2002, retrospective rating plan adjustments and premium discounts.

ARTICLE XIII — REPORTS AND REMITTANCES

	A.	 	The Company shall furnish the Subscribing Reinsurer with all necessary data respecting
premiums and losses for as long as one of the parties hereto has a claim against the other
arising from this Agreement.
	 
	B.	 	Quarterly Deposit Premiums equal to 1/4 of the 100% of Annual Deposit Premium will be remitted
on January 15, May 15, August 15 and November 15, according to the schedule below. The
Company shall submit finalized accounts to the Subscribing Reinsurer on February 15, of the
subsequent year, summarizing the actual subject earned premium for the previous Agreement
Year. The difference between the deposit premium and the actual subject earned premium will
be settled to/from the Company within 15 days of February 15. However, in no event shall the
annual adjusted premium be less than the Annual Minimum Premium for each layer, set forth
below:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Annual	 	Annual	 	Quarterly
	Layer	 	Minimum	 	Deposit	 	Deposit
	1. Exhibit A
	 	$	10,353,485	 	 	$	12,941,856	 	 	$	3,235,464	 
	2. Exhibit B
	 	$	1,811,947	 	 	$	2,264,934	 	 	$	566,234	 
	3. Exhibit C
	 	$	1,258,635	 	 	$	1,573,293	 	 	$	393,323	 

Payment by the Subscribing Reinsurer of its portion of loss and Loss Adjustment Expenses paid by
the Company shall be made by the Subscribing Reinsurer to the Company immediately upon reasonable
evidence of the amount due or to be deemed being furnished by the Company.

ARTICLE XIV — LOSS ADJUSTMENT AND SETTLEMENT

The Company shall give notice, as soon as practicable, to the Subscribing Reinsurer of any claim
that it has reason to believe could involve this Agreement. The Company shall keep the Subscribing
Reinsurer informed of significant developments likely to affect the cost of any claim or claims
hereunder.

The Company may commence, continue, defend, settle, or withdraw from actions, suits, or
prosecutions and, generally, do all such things relating to any claim or loss in which the
Subscribing Reinsurer is interested as, in the Company’s judgment, may be beneficial or expedient
to the Company and the Subscribing Reinsurer. The Company shall be the sole judge as to what claims
are covered under its Policies. All of the Company’s Ultimate Net Loss (and loss occurrences), as
well as all loss settlements made and judgments paid by the Company, provided they are within the
terms of this Agreement either under the strict conditions of the Company’s Policies or by way of
compromise, shall be unconditionally binding upon the Subscribing Reinsurer, who agrees to pay all
amounts for which they are liable immediately upon reasonable evidence of the amount due being
furnished to the Subscribing Reinsurer by the Company. The true intent of this Agreement is that
the Subscribing Reinsurer shall, in every case to which this Agreement applies, follow the
settlements of the Company,

Agreement No. RAM Re SumCX — 2006

8.

 

The Company shall advise the Subscribing Reinsurer of all claims which:

	 	1.	 	Are reserved by the Company for an amount in excess of 50% of its retention;
	 
	 	2.	 	Originate from fatal injuries;
	 
	 	3.	 	Originate from the following kinds of bodily injury:

	 	a.	 	Brain injuries resulting in impairment of physical function;
	 
	 	b.	 	Spinal injuries resulting in a partial or total paralysis of upper or lower
extremities;
	 
	 	c.	 	Amputation or permanent loss of use of upper or lower extremities;
	 
	 	d.	 	Severe burn injuries;
	 
	 	e.	 	Loss of sight in one or both eyes;
	 
	 	f.	 	All other injuries likely to result in a permanent disability rate of 50% or more.

ARTICLE XV — SALVAGE AND SUBROGATION

The Reinsurers shall be credited with their share of salvage and/or subrogation in respect of
claims and settlements under this Agreement, less their share of recovery expense. Unless the
Company and Reinsurers agree to the contrary, the Company shall enforce its right to salvage and/or
subrogation and shall prosecute all claims arising out of such right. Should the Company refuse or
neglect to enforce this right, the Reinsurers are hereby empowered and authorized to institute
appropriate action in the name of the Company.

Amounts recovered from salvage and/or subrogation shall always be used to reimburse the excess
Reinsurers (and the Company, should it carry a portion of excess coverage net) in the reverse
order of their participation in the loss before being used in any way to reimburse the Company for
its primary loss. If the amount recovered exceeds the recovery expense, the recovery expense shall
be borne by each party in proportion to its benefit from the recovery. If the recovery expense
exceeds the amount recovered, the amount recovered (if any) shall be applied to the reimbursement
of recovery expense and the remaining expense, as well as any originally incurred loss expense,
shall be added to the Ultimate Net Loss. If no amount is recovered from salvage and/or
subrogation, the expense incurred in attempting such recovery shall be deemed loss expense and
shall be added to the Ultimate Net Loss.

ARTICLE XVI — FEDERAL TERRORISM RECOVERY CLAUSE

Any loss reimbursement the Company receives from the United States Government under the Terrorism
Risk Insurance Act of 2002 (“TRIA”) as a result of loss occurrences commencing during the term of
this Agreement shall apply as follows:

Except as provided below, any loss reimbursement under TRIA shall inure solely to the benefit of
the Company and shall be entirely disregarded in applying all of the provisions of this Agreement.

Agreement No. RAM Re SumCX — 2006

9.

 

If one or more loss occurrences commencing during the term of this Agreement result(s) in
reinsurance recoveries to the Company under this Agreement and reimbursement under TRIA, and such
amounts, together with any other reinsurance recoveries to the Company for said loss occurrence(s),
exceed the total amount of “Insured Losses” to the Company, any amount in excess thereof shall be
held by the Company. The Company shall then reimburse the Subscribing Reinsurer a portion of such
excess recovery in an amount equal to the proportion that the Subscribing Reinsurer’s payment under
this Agreement bears to the total treaty reinsurance recoveries to the Company for Insured Losses
for said loss occurrence(s). Provided, however, that in no event shall such reimbursement exceed
the amount paid by the Subscribing Reinsurer to the Company under this Agreement.

For purposes hereof, if a loss reimbursement received by the Company under TRIA is based on the
Company’s Insured Losses in more than one loss occurrence and neither the Secretary of the
Treasury nor his delegatee specifies the amount of loss allocable to each respective loss
occurrence, the reimbursement shall be pro-rated in the proportion that the Company’s Insured
Losses in each loss occurrence bears to the Company’s total Insured Losses resulting from all loss
occurrences to which the reimbursement applies.

For purposes of this Article: (a) “TRIA” shall mean the Terrorism Risk Insurance Act of 2002 and
any subsequent amendments thereto; and (b) “Insured Loss(es)” shall have the same meaning as set
forth in Section 102(5) of TRIA.

ARTICLE XVII — ACCESS TO RECORDS

Except as otherwise provided in this Article, the Subscribing Reinsurer, or its duly authorized
representative, may upon reasonable prior written notice to the Company, at Subscribing
Reinsurer’s own expense, examine at the offices of the Company, during normal office hours, the
Company’s Policy, accounting, underwriting, or claim records and files, or any such additional
relevant records and files, as they exist in the Company’s possession or reasonable control,
relating to business ceded under this Agreement. The Subscribing Reinsurer’s notice shall
reasonably describe the nature of the inspection that it wishes to conduct, the persons conducting
the inspection and upon notice of available files from the Company, the files that it wishes to
review. Subject to the limitations expressed in this Article, this right of inspection shall
survive termination or expiration of this Agreement and shall continue as long as either Party has
any rights or obligations under this Agreement.

The Company reserves the right to deny the Subscribing Reinsurer access to records or files
concerning any particular claim(s) if the Subscribing Reinsurer has not disputed liability for
payment of such claim(s), and payment of such claim(s) is more than ninety (90) days overdue
according to the Company’s records. The Company shall, however, prior to an arbitration demand
that may be instituted by either party, continue to respond to reasonable specific requests for
information and questions raised by the Subscribing Reinsurer concerning such claims; and nothing
in this Article shall restrict the right or ability of the Subscribing Reinsurer to seek discovery
of relevant information in an arbitration proceeding pursuant to the Arbitration Article of this
Agreement.

As a condition precedent to access to records under this Article, the Subscribing Reinsurer, its
personnel and any authorized third party representative of the Subscribing Reinsurer shall agree
to the provisions of the Confidentiality Article of this Agreement.

The Company reserves the right to withhold any documents from Subscribing Reinsurer (a) concerning
Trade Secrets of the Company, (b) subject to the terms of a third party non-disclosure agreement
with the Company requiring third party consent to disclosure, (c) subject to the Work Product
Privilege or Attorney-Client Privilege or (d) concerning individual private information that as

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a matter of law cannot be disclosed by the Company (hereinafter referred to in the Agreement as
“Privileged Documents”). The Company shall reasonably try to exempt the Reinsurers from any third
party non-disclosure agreement or obtain consent from the third party to disclose to the
Subscribing Reinsurer.

Notwithstanding the foregoing, the Company shall permit and not object to the Subscribing
Reinsurer’s access to Privileged Documents in connection with the underlying claim reinsured
hereunder following final settlement or final adjudication of the case or cases involving such
claim, with prejudice against all claimants, and all parties to such adjudications; provided that
the Company, may defer release of such Privileged Documents if there are subrogation,
contribution, or other third party actions with respect to that claim or case, which might
jeopardize the Company’s defense by release of such Privileged Documents. In the event that the
Company shall seek to defer release of such Privileged Documents, it will in consultation with the
Subscribing Reinsurer take other steps as reasonably necessary to provide the Subscribing
Reinsurer with the information it reasonably requires to indemnify the Company without causing a
loss of such privileges. The Subscribing Reinsurer, however, shall not have access to Privileged
Documents relating to any dispute between the Company and the Subscribing Reinsurer.

For purposes of this Article, “Trade Secrets” shall have the meaning provided in Section 1839 of
the United States Economic Espionage Act of 1996. “Attorney-Client Privilege” shall mean
communications of a confidential nature between a) the Company, or anyone retained or in the
control of the Company, or its or its affiliates’ in-house or outside legal counsel, or anyone in
the control of such legal counsel, and b) any in-house or outside legal counsel which relate to
legal advice being sought by the Company and/or which contains legal advice being provided to the
Company. “Work Product Privilege” shall mean communications, written materials and tangible things
prepared by or for in-house or outside counsel, or prepared by or for the Company, in anticipation
of or in connection with litigation, arbitration, or other dispute resolution proceedings.

ARTICLE XVIII — DIVIDENDS AND TAXES

In consideration of the terms of this Agreement, the Company shall not claim any deduction in
respect of any amount paid as dividends or as reinsurance premium when making tax returns, other
than income or profits tax returns to any State or to the District of Columbia.

ARTICLE XIX — FEDERAL EXCISE TAX

This Article is applicable to any Subscribing Reinsurer who is domiciled outside of the United
States of America, except for any Subscribing Reinsurer exempt from Federal Excise Tax. A
Subscribing Reinsurer that claims exempt status from Federal Excise Tax shall provide to the
Company, upon its request, proof that the exempt status adequately satisfies the demands of the
U.S. Internal Revenue Agency and/or other applicable U.S. government authority.

Each Subscribing Reinsurer shall allow the applicable percentage of the premium payable hereon (as
imposed under Section 4371 of the Internal Revenue Code) for the purpose of paying Federal Excise
Tax to the extent such premium is subject to such tax.

In the event of any return of premium, the Subscribing Reinsurer shall deduct the aforesaid
percentage from the return premium payable hereon and the Company or its agent shall recover such
tax from the United States Government.

ARTICLE XX — GOVERNING LAW

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The validity and interpretation of this Agreement shall be governed by and construed in accordance
with the law of the State of New Hampshire.

ARTICLE XXI — CURRENCY

Whenever a reference to a monetary currency appears in this Agreement, it shall be construed to
mean United States Dollars (“USD”). However, in those cases where the Policies are issued by the
Company using Canadian Dollars (“CAD”), it shall mean Canadian Dollars. All payments made by either
party shall be made in United States Dollars except that payments made involving Policies issued
using Canadian Dollars shall be made in Canadian Dollars.

ARTICLE XXII — OFFSET

Each party to this Agreement together with their successors or assigns shall have and may
exercise, at any time, the right to offset any balance(s) due the other (or, if more than one, any
other). Such offset may include balances due under this Agreement, and any other agreements
between the parties, whether such balances arises from premium, losses, or otherwise, and
regardless of the capacity of any party, whether as assuming and/or ceding insurer, under the
various reinsurance agreements involved, provided however, that in the event of insolvency of a
party hereto, offsets shall only be allowed in accordance with the provisions of the applicable
law, statute, or regulation governing such offset.

ARTICLE XXIII — ERRORS AND OMISSIONS

Any inadvertent delay, omission, or error in complying with the terms and conditions of this
Agreement 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, provided such delay,
omission, or error is rectified upon discovery.

ARTICLE XXIV — INSOLVENCY

(If more than one reinsured company is referenced within the definition of “Company” in the
Preamble to this Agreement, this Article shall apply severally to each such company. Further, this
Article and the laws of the domiciliary state shall apply in the event of the insolvency of any
company intended to be covered hereunder. In the event of a conflict between any provision of this
Article and the laws of the domiciliary state of any company intended to be covered hereunder,
that domiciliary state’s laws shall prevail.)

In the event of the insolvency of the Company, reinsurance under this Agreement shall be payable
on demand, with reasonable provision for verification, on the basis of claims allowed against the
insolvent Company by any court of competent jurisdiction or by any liquidator, receiver,
conservator, or statutory successor of the Company having authority to allow such claims, without
diminution because of such insolvency or because such liquidator, receiver, conservator, or
statutory successor has failed to pay all or a portion of any claims. Such payments by the
Subscribing Reinsurer shall be made directly to the Company or its liquidator, receiver,
conservator, or statutory successor, except to the extent Section 4118(a) of the New York
Insurance Law applies, or except (a) where the Agreement specifically provides another payee of
such reinsurance in the event of the insolvency of the Company, or (b) where the Subscribing
Reinsurer with the consent of the direct insured or insureds has assumed such Policy obligations
of the Company as direct obligations of the Subscribing Reinsurer to the payees under such
Policies and in substitution for the obligations of the Company to such payees.

Agreement No. RAM Re SumCX — 2006

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It is agreed, however, that the liquidator, receiver, conservator, or statutory successor of the
insolvent Company shall give written notice to the Subscribing Reinsurer of the pendency of a claim
against the insolvent Company on the Policy or Policies reinsured within a reasonable time after
such claim is filed in the insolvency proceeding and that during the pendency of such claim the
Subscribing Reinsurer 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 it may deem
available to the Company or its liquidator, receiver, conservator, or statutory successor. The
expense thus incurred by the Subscribing Reinsurer shall be chargeable, subject to court approval,
against the insolvent Company as part of the expense of liquidation to the extent of a
proportionate share of the benefit, which may accrue to the Company solely as a result of the
defense undertaken by the Subscribing Reinsurer.

Where two or more Reinsurers are involved in the same claim and a majority in interest elects to
interpose defense to such claim, the expense shall be apportioned in accordance with the terms of
this Agreement as though such expense had been incurred by the insolvent Company.

With respect to California Workers Compensation loss(es), it is agreed that in the event of any
delinquency proceeding, receivership, or insolvency of the Company and/or the failure of the
Subscribing Reinsurer, for any reason, to make payments under this Agreement, the Insurance
Commissioner of California may, upon 30-days notice, draw upon any sums from the deposit made by
the Subscribing Reinsurer in accordance with the provisions of sections 11691 — 11703 of the
California Insurance Code.

ARTICLE XXV — MEDIATION

	A.	 	In the event of any dispute or difference of opinion arising out of or relating to this
Agreement, including but not limited to the formation, interpretation, performance or breach
of this Agreement, whether such dispute arises before or after the expiration of this
Agreement, the Company and the Subscribing Reinsurer may mutually agree in writing that, prior
to proceeding with arbitration, they will submit such dispute or difference of opinion to
non-binding mediation which will be held at a location mutually agreed by the parties.
	 
	B.	 	Each party shall submit a list of not more than four (4) potential mediators to the other
party within the fourteen (14) days of reaching such mutual agreement. The two parties shall
then agree on the appointment on one (1) mediator from the combined lists within seven (7)
days. The mediator shall be a neutral, impartial third party, without past employment or
directorial relationships with the parties to the mediation. Such mediator shall make full
disclosure of all past partisan relationships with either the Company or Subscribing Reinsurer
to the parties within seven (7) days of his or her notification that he or she has been
selected as a Mediator.
	 
	C.	 	If the Company and the Subscribing Reinsurer cannot agree on a mediator within twenty one
(21) days from the date of a mutual agreement to mediate, then arbitration proceedings may
commence in accordance with the Arbitration Article.
	 
	D.	 	The mediator will schedule an initial mediation session within thirty (30) days of his or her
appointment and will be responsible for the formulation of an agenda to be distributed to the
parties involved in the mediation not less than five (5) days before the mediation commences.
	 
	E.	 	The mediator will not have the power of enforcement of any agreement between the parties nor
will the mediator have any right to assess any damages, including punitive damages, to either
party participating in the mediation.
	 
	F.	 	If, in the opinion of the mediator, the parties cannot resolve the dispute or difference of
opinion, Arbitration proceedings may commence in accordance with the Arbitration Article. In
any event, the mediation shall conclude within sixty (60) days of its referral to the
mediator. Should the

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	 	 	mediation not be resolved in sixty (60) days, then arbitration proceedings may commence in
accordance with the Arbitration Article.
	 
	G.	 	Each party shall bear the expense of its own representatives and shall jointly and
equally bear with the other party the expenses of the mediator and the place of mediation.

ARTICLE XXVI — ARBITRATION

	A.	 	Disputes to be Arbitrated. With the exception of any dispute resolution procedures
regarding commutation that are otherwise contained in this Agreement and any mutual agreement
to initially mediate any dispute pursuant to the Mediation Article, any and all disputes between
the Company and any Subscribing Reinsurer or Reinsurers (“Party” individually or “Parties”
collectively) arising out of, relating to, or concerning this Agreement, whether sounding in
contract or tort and whether arising during or after this Agreement’s formation, or after its
termination, including disputes as to whether the Agreement was validly formed or is voidable,
shall be submitted to the decision of an arbitration panel (“Panel”). The Panel shall consist
of an umpire and two party-appointed arbitrators unless a Party meets the requirements of
Paragraph C of this Article and demands arbitration pursuant thereto, in which case the Panel
would consist of an umpire only.
	 
	B.	 	Procedures. Except as provided herein, any arbitration shall be based upon the
Procedures for the resolution of U.S. Insurance and Reinsurance Disputes, Regular Panel
Version, dated April 2004 (the “Procedures”), developed by the Insurance and Reinsurance
Dispute Resolution Task Force, subject to the following modifications:

	 	1.	 	Qualifications of the arbitrators and umpires shall be in accordance with
Alternative section 6.2 of the Procedures.
	 
	 	2.	 	The Parties hereby designate the umpire list maintained by ARIAS (U.S.) as the list
to be used in the event that section 6.7(a) of the Procedures is invoked.
	 
	 	3.	 	Unless otherwise mutually agreed, the members of the Panel shall be impartial and
disinterested. The members of the Panel may not be: (1) in the control of any Party or
its parent, affiliate, or agent, (2) a former director or officer of any Party or its
parent, affiliate, or agent, or (3) a likely witness in the arbitration. The requirement
of impartiality means that all members of the Panel shall have the same obligation to
approach the Panel’s duties and decisions with fairness and without consideration for the
fact that Panel members may have been appointed by one of the Parties. The requirement of
impartiality does not mean that any arbitrator can have no previous knowledge of or
experience with respect to issues involved in the dispute or disputes.
	 
	 	4.	 	The first sentence of Section 10.4 of the Procedures shall be replaced by the
following sentence: “The Panel shall require that each Party submit concise written
statements of position, including summaries of the facts and evidence a Party intends to
present, discussion of the applicable law and the basis for the requested Award or denial
of relief sought.”
	 
	 	5.	 	Once the Panel has been constituted, no Party (or anyone acting for a Party) shall have
any communications concerning the arbitration or any of the issues before the Panel with
any member of the Panel that is not also disclosed to all other Parties and all members
of the Panel. Each Panel member shall have a continuing duty to disclose promptly to all
Parties and all Panel members any violation of this prohibition and the specifics of any
improper communications that occurred. This prohibition shall remain in place until
all

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	 	 	 	challenges to any arbitration awards and decisions have been either waived or finally
concluded.
	 
	 	6.	 	Section 11.1 of the Procedures shall be replaced by the following provision: “The
Parties may propound discovery seeking disclosure of such information and/or documents
relevant to the dispute or necessary for the proper resolution of the dispute.”
	 
	 	7.	 	Position statements may be amended at any reasonable time, but not later than the
close of discovery without a showing to the Panel that the amending Party could not
reasonably have raised the new claim or issue at an earlier time.
	 
	 	8.	 	The Panel shall hold an evidentiary hearing, if one is necessary, within one year
of the arbitration demand, unless the Parties otherwise agree. Should a Party
seek a reasonable extension to this time frame for good cause shown, the other Party’s
agreement shall not be unreasonably withheld.
	 
	 	9.	 	To the extent permitted by the law, the Panel shall have the authority to issue
subpoenas and other orders to enforce its decisions.
	 
	 	10.	 	The Panel may award reasonable attorneys’ fees and arbitration costs to the
prevailing Party, as determined by the Panel.
	 
	 	11.	 	Section 14.3 of the Procedures shall be replaced by the following provision: “The
Panel shall make a decision and issue an award with regard to the terms expressed in this
Agreement, and the custom and practice of the property and casualty insurance and
reinsurance business. The Panel shall not be obligated to follow the strict rules of
law and evidence.”

	C.	 	Alternative Streamlined Procedures. Notwithstanding the foregoing provisions of
this Article, the Alternative Streamlined Procedures set forth in section 16 of the
Procedures, as modified by sections B3, B4, and B9 through B11 of this Article, shall apply in
the event that, in a consolidated proceeding or otherwise, the Party initiating arbitration is
seeking payment of a total amount that is no greater than one million dollars ($1,000,000), or
the currency equivalent thereof. Sections 16.1, 16.2, 16.3 and the second sentence of section
16.4 of the Alternative Streamlined Procedures shall not apply. The Parties agree to comply
with section 6.7 of the Procedures to appoint a single umpire, and hereby designate the umpire
list maintained by ARIAS (U.S.) as the list to be used in section 6.7(a).
	 
	D.	 	Hearing Location. The hearing shall be held in Boston, Massachusetts, unless the
Parties mutually agree to a different location.
	 
	E.	 	Confirmation. Either Party may apply to a court of competent jurisdiction for an
order confirming any award of the Panel; a judgment of that court shall thereupon be entered
on any award. If such an order is issued, the Party against whom confirmation is sought shall
pay the attorneys’ fees incurred of the Party who applied for the confirmation order and all
court costs of any such proceeding.
	 
	F.	 	Equitable Relief from a Court of Law. Nothing herein shall be construed to prevent
any participating Party from applying to a court of competent jurisdiction to issue a
restraining order or other equitable relief to maintain the “status quo” of the Parties
participating in the arbitration pending the decision and award by the Panel.
	 
	G.	 	Consolidated Proceedings.

Agreement No. RAM Re SumCX — 2006

15.

 

	 	1.	 	Same agreement, single Subscribing Reinsurer. Both the Company and any single
Subscribing Reinsurer on this Agreement have the right to combine any and all disputes
between them that concern this Agreement (including any renewal of this Agreement or any
agreement for which this Agreement is a renewal) into a single arbitration
proceeding before a single Panel, except that the standard for determining whether a
Party may add a new issue, claim, or dispute to an arbitration proceeding shall be the
standard for amending a Position statement, as set forth in Paragraph B7 of this
Article.
	 
	 	2.	 	Multiple agreements, single Subscribing Reinsurer. The Company has the right to
combine any and all disputes between the Company and a single Subscribing Reinsurer into
a single arbitration proceeding before a single Panel where such disputes involve this
Agreement and any additional agreements between the two Parties, except that the standard
for determining whether a Party may add a new issue, claim, or dispute to an arbitration
proceeding shall be the standard for amending a Position statement, as set forth in
Paragraph B7 of this Article.
	 
	 	3.	 	Same agreement, multiple Reinsurers. At the Company’s option, if more than one
Subscribing Reinsurer is involved in arbitration relating to this Agreement, where there
are common questions of law or fact and a possibility of conflicting awards or
inconsistent results, all such Reinsurers shall constitute and act as one Party for
purposes of this Article and communications shall be made by the Company to each of the
Reinsurers constituting the one Party; provided, however, that the Reinsurers shall have
the right to assert several, rather than joint defenses or claims, and to be
represented by separate counsel. This provision shall not change the liability of each of
the Reinsurers under the terms of this Agreement from several to joint.

	H.	 	Choice of Law. The law set forth in the Governing Law Article shall apply to this
Arbitration Article. In addition, to the extent the Panel (or the umpire in an Alternative
Streamlined Procedure) looks to applicable law, such Panel or umpire shall apply the law as
set forth in the Governing Law Article of this Agreement.
	 
	I.	 	Survival of Article. This Article shall survive the termination or expiration of this
Agreement.

ARTICLE XXVII — SPECIAL CONDITIONS

The Company may terminate this Agreement at any time by the giving of 30 days prior notice in
writing to the Subscribing Reinsurer upon the happening of any one of the following circumstances:

	A.	 	A State insurance Department or other legal authority orders the Subscribing Reinsurer to
cease writing business; or
	 
	B.	 	The Subscribing Reinsurer has become insolvent or has been placed into liquidation or
receivership (whether voluntary or involuntary) or there have been instituted against it
proceedings for the appointment of a receiver, liquidator, rehabilitator, conservator, trustee
in bankruptcy, or other agent known by whatever name, to take possession of its assets or
control of its operations; or
	 
	C.	 	The Subscribing Reinsurer’s policyholders’ surplus has been reduced by 25% of the amount of
surplus at the inception of this Agreement; or
	 
	D.	 	The Subscribing Reinsurer has become merged with, acquired or controlled by any company,
corporation, or individual(s) not controlling the Reinsurer’s operations at the inception of
this Agreement; or

Agreement No. RAM Re SumCX — 2006

16.

 

	E.	 	The Subscribing Reinsurer’s A.M. Best Rating has been assigned or downgraded below A- or
Standard and Poor’s Counterparty Credit and Financial Strength rating has been assigned or
downgraded below A-.

The coverage afforded by this Agreement shall cease as of the date of termination and the
Subscribing Reinsurer shall return the unearned premium, if any. If coverage hereunder terminates
while a claim covered by this Agreement is in progress, the Subscribing Reinsurer shall be liable
subject to all other conditions hereof for its proportion of the entire claim, provided that the
event giving rise to the claim started before such termination.

If the Company elects to terminate this Agreement, the Company shall have the option to commute
the Subscribing Reinsurer’s liability for loss(es), whether reported or unreported, comprising the
sum total of the present value of the ceded (1) case reserves and allocated loss adjustment
expense, (2) projected ultimate losses, (3) any unearned premium reserve, and (4) undiscounted
outstanding paid claims (hereinafter the “Commutation Losses”), on Policies covered by this
Agreement as of the effective date of termination.

	A.	 	The Company shall submit a statement of valuation showing the elements considered reasonable
to establish the Commutation Losses, and the Subscribing Reinsurer shall pay the amount
requested. In the event the Company and the Subscribing Reinsurer cannot agree on the
statement of valuation of the Subscribing Reinsurer’s liability under such Policies, either
party may request in writing that the differences be settled by a panel of three actuaries.
Each party shall appoint an actuary to assess such liability within 15 days after receipt of
the written request for commutation. Upon such appointment, the two actuaries shall appoint
a third actuary. If the two actuaries fail to agree on the third actuary within 30 days of
their appointment, each of them shall nominate three individuals, of whom the other shall
decline two, and the final decision shall be made by drawing lots. The actuaries shall then
investigate and capitalize such Commutation Loss (es) within 30 days. As used herein,
“capitalize” shall mean to determine the present value of Commutation Losses, without regard
to the Subscribing Reinsurer’s ability to pay such losses. The panel shall meet in Boston
Massachusetts, unless the Company and Subscribing Reinsurer agree otherwise.
	 
	B.	 	All actuaries shall be disinterested in the outcome of the commutation and shall be Fellows
of the Society of Actuaries/Fellows of the Casualty Actuarial Society. Except as stated
below, the expense of the actuaries and of the commutation shall be equally divided between
the parties of the commutation.
	 
	C.	 	The decision in writing of the actuaries, when filed with the parties hereto, shall be final
and binding, except that if the Company does not agree with the capitalized value of the
Commutation Loss(es), the Company shall have no obligation to commute. In the event the
Company does not agree with the capitalized value of the Commutation Loss(es) and does not
move forward with commutation, the expense of the actuaries [including reasonable expense of
the actuary appointed by the Subscribing Reinsurer] will be paid by the Company. If the
Agreement is commuted, payment by the Subscribing Reinsurer to the Company or any other third
party mutually agreed upon by the Subscribing Reinsurer and the Company shall constitute a
complete and final release of the Subscribing Reinsurer in respect to its liability under this
Agreement.

Termination under the terms of this Article can be made after the date of expiration of this
Agreement.

ARTICLE XXVIII — THIRD PARTIES

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This Agreement shall not be deemed to give any right or remedy to any third party whatsoever unless
said right or remedy is specifically granted to such third party by the terms of this Agreement.

ARTICLE XXIX — UNAUTHORIZED REINSURANCE

(Applies only to a Subscribing 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 Subscribing Reinsurer a statement showing the proportion of such
reserves which is applicable to the Subscribing Reinsurer. The Subscribing Reinsurer hereby agrees
to fund such reserves in respect of unearned premium, known outstanding losses that have been
reported to the Subscribing Reinsurer and allocated loss adjustment expense relating thereto,
losses and allocated loss adjustment expense paid by the Company but not recovered from the
Subscribing Reinsurer, plus reserves for losses incurred but not reported as determined by the
Company, as shown in the statement prepared by the Company (hereinafter referred to as
“Subscribing Reinsurer Obligations”) by Letters of Credit unless the method of funding is
determined by applicable law, statute, or regulation.

The Subscribing Reinsurer agrees to apply for and secure timely delivery to the Company of clean,
irrevocable, and unconditional Letters of Credit issued by a bank that is a qualified U.S.
financial institution and containing provisions acceptable to the insurance regulatory authorities
having jurisdiction over the Company’s reserves in an amount equal to the Subscribing Reinsurer’s
proportion of said reserves. At the Company’s request, Subscribing Reinsurer will agree to provide
separate Letters of Credit for any distinct legal entities within the Company covered under this
Agreement. Such Letters 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 60 days prior to any expiration date the issuing bank shall notify the Company by
certified mail that the issuing bank elects not to consider the Letters of Credit extended for any
additional period.

The Subscribing Reinsurer and Company agree that the Letters of Credit provided by the Subscribing
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, without diminution because of the
insolvency of the Company or the Subscribing Reinsurer for one or more of the following purposes:

	A.	 	To reimburse the Company for the Subscribing Reinsurer’s share of premiums returned to the
owners of Policies reinsured under this Agreement because of cancellations of the Policies;
	 
	B.	 	To reimburse the Company for the Subscribing Reinsurer’s share of surrenders and benefits or
losses paid by the Company under provisions of the Policies reinsured under this Agreement;
	 
	C.	 	To fund an account with the Company in an amount, at least, equal to the deduction for
reinsurance ceded from the Company liabilities for Policies ceded under this Agreement. The
account shall include, but not be limited to, amounts for Policy reserves, claims and losses
incurred (including losses incurred but not reported), loss adjustment expenses, and unearned
premium reserves; and
	 
	D.	 	To pay any other amounts the Company claims are due under this Agreement.

Agreement No. RAM Re SumCX — 2006

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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 Subscribing Reinsurer’s Obligations, for the
sole purpose of amending the Letters of Credit, in the following manner:

	A	 	If the statement shows that the Subscribing Reinsurer’s Obligations exceed the balance of
credit as of the statement date, the Subscribing Reinsurer shall, within 30 days after
receipt of notice of such excess, secure delivery to the Company of an amendment to the
Letters of Credit increasing the amount of credit by the amount of such difference.
	 
	B.	 	If, however, the statement shows that the Subscribing 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 Subscribing Reinsurer, release such excess credit by
agreeing to secure an amendment to the Letters of Credit reducing the amount of credit
available by the amount of such excess credit.

ARTICLE XXX — SERVICE OF SUIT

(This article applies to unauthorized Reinsurers and to Reinsurers who are domiciled outside the
United States of America.)

This Service of Suit Article will not be read to conflict with or override the obligations of the
parties to arbitrate their disputes as provided for in the Arbitration Article. This Article is
intended as an aid to compelling arbitration or enforcing such arbitration or arbitral award, not
as an alternative to the Arbitration Article for resolving disputes arising out of this Agreement.

In the event of the failure of the Subscribing Reinsurer to pay any amount claimed to be due
hereunder, the Subscribing Reinsurer, 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 the Subscribing Reinsurer’s right 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. The Subscribing Reinsurer, once
the appropriate Court is selected, whether such court is the one originally chosen by the Company
and accepted by the Subscribing Reinsurer or is determined by removal, transfer, or otherwise, as
provided for above, will comply with all requirements necessary to give said Court jurisdiction
and, in any suit instituted against any of them upon this Agreement, will abide by the final
decision of such Court or of any Appellate Court in the event of an appeal.

Service of process in such suit may be made upon Mendes & Mount, LLP, 750 Seventh Avenue, New
York, NY 10019-6829.

Agreement No. RAM Re SumCX — 2006

19.

 

The above-named are authorized and directed to accept service of process on behalf of the
Subscribing Reinsurer in any such suit. Further, pursuant to any statute of any state, territory,
or district of the United States that makes provision therefore, the Subscribing Reinsurer hereby
designates the Superintendent, Commissioner, or Director of Insurance, or other officer specified
for that purpose in the statute, or their successor(s) in office, as their true and lawful attorney
upon whom may be served any lawful process in any action, suit, or proceedings instituted by or on
behalf of the Company or any beneficiary hereunder arising out of this Agreement, 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.

ARTICLE XXXI — CONFIDENTIALITY CLAUSE

Confidential Information. The submission materials, and any Policy, financial,
underwriting, accounting, and claims information, data statements, representations, and other
materials provided by the Company and received by the Subscribing Reinsurer in the course of an
audit, inspection, or

otherwise, represent confidential or proprietary information (“Confidential Information”). This
Confidential Information is intended for the sole use of the Subscribing Reinsurer (and its
retrocessionaires, respective auditors and legal counsel) as may be necessary in analyzing and/or
accepting a participation in and/or executing its responsibilities under or related to this
Agreement. Subscribing Reinsurer acknowledges and agrees that with respect to any review of
Confidential Information by Subscribing Reinsurer, and/or discussion of Confidential Information,
Company does not waive and does not intend to waive any available privilege or protection. The
review of Confidential Information by Subscribing Reinsurer and/or discussion of Confidential
Information with Company shall not destroy, waive, or otherwise impair the proprietary and/or
protected status of any Confidential Information or any information revealed in such discussion
with Company personnel, whether reviewed by and/or discussed with Subscribing Reinsurer
intentionally or inadvertently, nor does the review of the Confidential Information and/or
discussion of Confidential Information with Company constitute an estoppel or waiver of Company’s
rights to assert the attorney-client or work-product privileges, or any other applicable privilege
or protection, over certain documents contained in the Company files and/or certain information.

The Company and Subscribing Reinsurer agree that no confidentiality obligations will apply to
Confidential Information to the extent such Confidential Information: (1) is or becomes available
to the public, other than as a result of impermissible disclosure by the Subscribing Reinsurer,
(2) was or became available lawfully to Subscribing Reinsurer from a source, other than Company or
its personnel, that is not subject to a confidentiality obligation, (3) was developed
independently by Subscribing Reinsurer prior to disclosure by Company or its personnel, as
demonstrated by Subscribing Reinsurer’s records, or (4) is required to be disclosed by law,
regulation, court, or regulatory agency action.

Subscribing Reinsurer agrees to preserve all confidentiality and privilege pertaining to all
Confidential Information provided by Company and all knowledge and information gained through its
review of Confidential Information or discussions with Company personnel. Subscribing Reinsurer
further agrees not to disclose any such Confidential Information to any other person or entity
except as such disclosure may be necessary to its retrocessionaires, accountants, attorneys, or as
otherwise required by law. Subscribing Reinsurer agrees that no Confidential Information is to be
copied and/or removed from Company’s premises without the express permission of Company.

Agreement No. RAM Re SumCX — 2006

20.

 

Non-Public Personally Identifiable Information. Additionally, any disclosure of non-public
personally identifiable information shall comply with all state and federal statutes and
regulations governing the disclosure of non-public personally identifiable information. “Non-public
personally identifiable information” is financial or medical information of or concerning a private
person which either has been obtained from sources which are not available to the general public or
obtained from the person who is the subject and which information is included in data files
exchanged by the parties hereto. For the purposes hereof, the terms shall include data elements
such as names and addresses of individuals. Disclosing or using this information for any purpose
beyond the scope of this Agreement, or beyond the exceptions set forth above, is expressly
forbidden without the prior consent of the Company.

Third-Party Demand. Should Subscribing Reinsurer receive a third-party demand pursuant to
subpoena, summons, or court or governmental order, to disclose Confidential Information (including
Non-public personally identifiable information) that has been provided by the Company, the
Subscribing Reinsurer shall make commercially reasonable efforts to notify the Company promptly
upon receipt of the demand and prior to disclosure of the Confidential Information and provide the
Company a reasonable opportunity to object to the disclosure. If the Company timely objects to the
release of the Confidential Information, the Subscribing Reinsurer will comply with the reasonable
requests of the Company in connection with the Company’s efforts to resist release of the
Confidential Information. The Company shall bear the cost of resisting the release of the
Confidential Information.

Survival. The parties agree that the obligations contained in this Article shall survive
the expiration or termination of this Agreement.

ARTICLE XXXII — AMENDMENTS

This Agreement may be amended by mutual consent of the parties expressed in an addendum; and such
addendum, when executed by both parties, shall be deemed to be an integral part of this Agreement
and binding on the parties hereto.

ARTICLE XXXIII — 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 XXXIV — INTEREST PENALTY

The interest amounts provided for in this Article shall apply to the Subscribing Reinsurer or to
the Company in the following circumstances:

	A.	 	If a loss payment owed by the Subscribing Reinsurer to the Company is not received within 45
calendar days following the date of presentation to the Subscribing Reinsurer of information
necessary to approve payment of the claim, and/or
	 
	B.	 	If any premium payment owed by the Company to the Subscribing Reinsurer is not received
within 45 calendar days following the date on which payment is due, and/or
	 
	C.	 	If any premium adjustment, agreed by either party to the other, is not received within 150
calendar days following the expiry or anniversary of this Agreement, and/or

Agreement No. RAM Re SumCX — 2006

21.

 

	D.	 	If any return of premiums, commissions, profit sharing, or any amounts not provided in
paragraphs A, B, and C above, are not received in accordance with the date specified in
this Agreement or if no date is specified, within 90 calendar days following the date the
debtor party received the billing.

Failure by the Subscribing Reinsurer or Company to comply with their respective payment
obligations within the time periods as herein provided shall, as of that date, be subject to an
interest payment computed by multiplying the amount due by a variable rate consisting of the U.S.
Prime Rate as published in the Eastern Edition of The Wall Street Journal on the first day of the
calendar month in which the amount became past due, plus 2%. The variable rate shall be adjusted
monthly thereafter to equal the U.S. Prime Rate as published in the Eastern Edition of The Wall
Street Journal on the first day of each successive month during which the amount due remains
unpaid, plus 2%. The product shall then be multiplied by 1/365 for each day after the due date
that the amount due and the interest amount remain unpaid. Any interest that occurs pursuant to
this Article shall be calculated by the party to which it is owed.

The validity of any claim or payment may be contested under the provisions of this Agreement. If
the debtor party prevails in an arbitration or any other proceeding with respect to the amounts in
dispute, there shall be no interest penalty due. If the creditor party wholly or partially
prevails on any of the amounts in dispute, the interest penalty shall be awarded as outlined
above. Such interest penalty shall be calculated from the date the monies were due and owing to
the date of resolution of the arbitration or proceeding, and shall be payable as of the date of
resolution of the arbitration or proceeding.

If a Subscribing Reinsurer advances the entire or partial payment of any claim it is contesting,
and wholly or partially prevails in the contest, the Company shall promptly return the applicable
amount of such payment. The arbitrator(s) hearing such dispute shall determine if interest shall
be added to the amount returned by the Company.

Any interest owing pursuant to this Article may be waived by the party to which it is owed.
Further, any interest calculated pursuant to this Article that is $100 or less shall be waived.
Any waiver of any interest pursuant to this paragraph, however, shall not affect the waiving
party’s right to claim and/or pursue interest for any other failure by the other party to make
payment when due under this Article.

ARTICLE XXXV — ASSIGNMENT

This Agreement shall be binding upon and inure to the benefit of the Company and the Subscribing
Reinsurer and their respective successors and assigns provided, however, that this Agreement may
not be assigned by either the Company or the Subscribing Reinsurer without the prior written
consent of the other. In the event of any assignment, the assignor shall remain liable.

ARTICLE XXXV — ENTIRE AGREEMENT

This Agreement shall constitute the entire agreement between the Company and the Subscribing
Reinsurer with respect to the subject matter of this Agreement and shall supersede all prior
understandings, negotiations and discussions, whether oral or written, by or between the Company
and the Subscribing Reinsurer relating to the subject matter herof. There are no general or
specific warranties, representations or other agreements by or among the Company and the
Subscribing Reinsurer in connection with entering into this Agreement except as specifically set
forth in this Agreement. Notwithstanding the foregoing, this Agreement may be amended or modified
only by a writing signed by both the Company and the Subscribing Reinsurer.

Agreement No. RAM Re SumCX — 2006

22.

 

EXHIBIT A

FIRST EXCESS OF LOSS

IS ATTACHED TO AND

FORMS PART OF

REINSURANCE AGREEMENT NO. RAM Re SumCX — 2006

 

 

EXHIBIT A — FIRST EXCESS OF LOSS

	 	 	 	 	 
	SECTION	 	SUBJECT	 	PAGE
	1

	 	LIMIT AND RETENTION
	 	A-1
	2

	 	REINSTATEMENT
	 	A-1
	3

	 	REINSURANCE PREMIUM
	 	A-1

 

 

EXHIBIT A — FIRST EXCESS OF LOSS

SECTION 1 — LIMIT AND RETENTION (amounts shown are in terms of Ultimate Net Loss)

The Company shall retain the first $2,000,000 of ultimate net loss as respects any one loss
occurrence. The Subscribing Reinsurer shall then be liable for the amount by which the Companies’
ultimate net loss exceeds the Company’s retention of $2,000,000 but the liability of the
Subscribing Reinsurer shall never exceed $3,000,000 any one loss occurrence.

SECTION 2 — REINSTATEMENT

	A.	 	It is understood and agreed that each claim hereunder reduces the amount of indemnity from
the time of occurrence of the loss by the sum paid, but any amount so exhausted is hereby
reinstated from the time the Loss Occurrence commences without payment of additional premium.
	 
	B.	 	Notwithstanding the foregoing, Reinsurers’ liability for losses arising out of an act of
Terrorism shall be limited to only $3,000,000 in the aggregate for all states, any one
Agreement Year.
	 
	C.	 	An “Act of Terrorism” for purposes of this Agreement shall mean:

	 	1.	 	Any actual or threatened violent act or act harmful to human life, tangible or
intangible property or infrastructure directed towards or having the effect of (a)
influencing or protesting against any de jure or de facto government or policy thereof,
(b) intimidating, coercing or putting in fear a civilian population or section thereof
for the purpose of establishing or advancing a specific ideological, religious or
political system of thought, perpetrated by a specific individual or group directly or
indirectly through agents acting on behalf of said individual or group or (c) retaliating
against any country for direct or vicarious support by that country of any other
government or political system.
	 
	 	2.	 	Any act declared pursuant to the Terrorism Risk Insurance Act of 2002 shall also be
considered an “Act of Terrorism” for purposes of this Agreement.

	D.	 	The term “Agreement Year” shall mean each consecutive twelve month period commencing January
1 and ending December 31 and shall include any run-off period,

SECTION 3 — REINSURANCE PREMIUM

	 	 	 	 	 
	 	 	Rate applied to
	Profit Center	 	Subject Earned Premium
	Summit
	 	 	1.703	%
	Total Subject Premium to the Layer:
	 	$	760,045,000	 
	Estimated Subject Net Earned Premium:
	 	$	12,941,856	 

Exhibit A-1

 

 

EXHIBIT B

SECOND EXCESS OF LOSS

IS ATTACHED TO AND

FORMS PART OF

REINSURANCE AGREEMENT NO. RAM Re SumCX — 2006

 

 

EXHIBIT B — SECOND EXCESS OF LOSS

	 	 	 	 	 
	SECTION	 	SUBJECT	 	PAGE
	1
	 	LIMIT AND RETENTION	 	B-1
	2
	 	REINSTATEMENT	 	B-1
	3
	 	REINSURANCE PREMIUM	 	B-1

 

 

EXHIBIT B — SECOND EXCESS OF LOSS

SECTION 1 — LIMIT AND RETENTION (amounts shown are in terms of Ultimate Net Loss)

The Company shall retain the first $5,000,000 of ultimate net loss as respects any one loss
occurrence. The Subscribing Reinsurer shall then be liable for the amount by which the Companies’
ultimate net loss exceeds the Company’s retention of $5,000,000 but the liability of the
Subscribing Reinsurer shall never exceed $5,000,000 any one loss occurrence.

SECTION 2 — REINSTATEMENT

	A.	 	It is understood and agreed that each claim hereunder reduces the amount of indemnity from
the time of occurrence of the loss by the sum paid, but any amount so exhausted is hereby
reinstated from the time the Loss Occurrence commences hereon. Three such reinstatements shall
be provided under this Exhibit.

	B.	 	The first and the second reinstatement shall be provided without payment of an additional
premium. The third reinstatement shall be provided for an additional premium calculated at pro
rata of the annual premium hereon, being pro rata only as to the limit of liability of this
Exhibit so reinstated and 100% as to the annual premium.

	C.	 	Notwithstanding the foregoing, Reinsurers’ liability for losses arising out of an act of
Terrorism shall be limited to only $5,000,000 in the aggregate for all states, any one
Agreement Year.

	D.	 	An “Act of Terrorism” for purposes of this Agreement shall mean:

	 	1.	 	Any actual or threatened violent act or act harmful to human life, tangible or
intangible property or infrastructure directed towards or having the effect of (a)
influencing or protesting against any de jure or de facto government or policy thereof,
(b) intimidating, coercing or putting in fear a civilian population or section thereof
for the purpose of establishing or advancing a specific ideological, religious or
political system of thought, perpetrated by a specific individual or group directly or
indirectly through agents acting on behalf of said individual or group or (c)
retaliating against any country for direct or vicarious support by that country of any
other government or political system.
	 
	 	2.	 	Any act declared pursuant to the Terrorism Risk Insurance Act of 2002 shall
also be considered an “Act of Terrorism” for purposes of this Agreement.

	E.	 	The term “Agreement Year” shall mean each consecutive twelve month period commencing January
1 and ending December 31 and shall include any run-off period.

SECTION 3 — REINSURANCE PREMIUM

	 	 	 	 	 
	 	 	Rate applied to
	Profit Center	 	Subject Earned Premium
	 
	Summit
	 	 	0.298	%
	 
	Total Subject Premium to the Layer:
	 	$	760,045,000	 
	Estimated Subject Net Earned Premium:
	 	$	2,264,934	 

Exhibit B-1

 

 

EXHIBIT C

THIRD EXCESS OF LOSS

IS ATTACHED TO AND

FORMS PART OF

REINSURANCE AGREEMENT NO. RAM Re SumCX — 2006

 

 

EXHIBIT C — THIRD EXCESS OF LOSS

	 	 	 	 	 
	SECTION	 	SUBJECT	 	PAGE
	1
	 	LIMIT AND RETENTION	 	C-1
	2
	 	REINSTATEMENT	 	C-1
	3
	 	REINSURANCE PREMIUM	 	C-1

 

 

EXHIBIT C —  THIRD EXCESS OF LOSS

SECTION 1 — LIMIT AND RETENTION (amounts shown are in terms of Ultimate Net Loss)

The Company shall retain the first $10,000,000 of ultimate net loss as respects any one loss
occurrence. The Subscribing Reinsurer shall then be liable for the amount by which the Companies’
ultimate net loss exceeds the Company’s retention of $10,000,000 but the liability of the
Subscribing Reinsurer shall never exceed $15,000,000 any one loss occurrence.

SECTION 2 — REINSTATEMENT

	A.	 	It is understood and agreed that each claim hereunder reduces the amount of indemnity from
the time of occurrence of the loss by the sum paid, but any amount so exhausted is hereby
reinstated from the time the Loss Occurrence commences hereon. One such reinstatement shall be
provided under this Exhibit for an additional premium calculated at pro rata of the annual
premium hereon, being pro rata only as to the limit of liability of this Exhibit so
reinstated and 100% as to the annual premium.

	B.	 	Notwithstanding the foregoing, Subscribing Reinsurers’ liability for losses arising out of an
act of Terrorism shall be limited to only $5,000,000 in the aggregate for all states, any one
Agreement Year.

	C.	 	An “Act of Terrorism” for purposes of this Agreement shall mean:

	 	1.	 	Any actual or threatened violent act or act harmful to human life, tangible or
intangible property or infrastructure directed towards or having the effect of (a)
influencing or protesting against any de jure or de facto government or policy thereof,
(b) intimidating, coercing or putting in fear a civilian population or section thereof
for the purpose of establishing or advancing a specific ideological, religious or
political system of thought, perpetrated by a specific individual or group directly or
indirectly through agents acting on behalf of said individual or group or (c) retaliating
against any country for direct or vicarious support by that country of any other
government or political system.
	 
	 	2.	 	Any act declared pursuant to the Terrorism Risk Insurance Act of 2002 shall also be
considered an “Act of Terrorism” for purposes of this Agreement.

	D.	 	The term “Agreement Year” shall mean each consecutive twelve month period commencing January
1 and ending December 31 and shall include any run-off period.

SECTION 3 — REINSURANCE PREMIUM

	 	 	 	 	 
	 	 	Rate applied to
	Profit Center	 	Subject Earned Premium
	 
	Summit
	 	 	0.207	%
	 
	Total Subject Premium to the Layer:
	 	$	760,045,000	 
	Estimated Subject Net Earned Premium:
	 	$	1,573,293	 

Exhibit C-1

 

 

APPENDIX A

Definition of Profit Center:

For purposes of Article I or any Articles, wherever the term “Profit Center” is used, the term
Profit Center is defined to include the following Profit Center.

	 	 	 
	Profit Center	 	Legal Entities
	 
	Summit:
	 	Bridgefield Casualty Insurance Company, and Bridgefield
Employers Insurance Company, WC and EL only, all States

 

 

Appendix B

	 	 	 

	 
	 	 
	“Fortune’s Global 500” list

	 	(Version 2004-July-26/ valid until further notice)

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	3M
	 	U.S.	 	 	281	 	 	 	18’232	 
	A.P. Møller-Mærsk Group
	 	Denmark	 	 	201	 	 	 	23’888	 
	ABB
	 	Switzerland	 	 	207	 	 	 	23’079	 
	Abbey National
	 	Britain	 	 	494	 	 	 	11’041	 
	Abbott Laboratories
	 	U.S.	 	 	254	 	 	 	19’681	 
	ABN AMRO Holding
	 	Netherlands	 	 	101	 	 	 	37’682	 
	Accenture
	 	U.S.	 	 	460	 	 	 	11’818	 
	Adecco
	 	Switzerland	 	 	278	 	 	 	18’391	 
	Aegon
	 	Netherlands	 	 	131	 	 	 	32’175	 
	AEON
	 	Japan	 	 	140	 	 	 	31’161	 
	Aetna
	 	U.S.	 	 	289	 	 	 	17’976	 
	AFLAC
	 	U.S.	 	 	477	 	 	 	11’447	 
	Agricultural Bank of China
	 	China	 	 	412	 	 	 	13’303	 
	Air France Group
	 	France	 	 	375	 	 	 	14’510	 
	Aisin Seiki
	 	Japan	 	 	384	 	 	 	14’211	 
	Akzo Nobel
	 	Netherlands	 	 	365	 	 	 	14’771	 
	Albertson’s
	 	U.S.	 	 	111	 	 	 	35’436	 
	Alcan
	 	Canada	 	 	404	 	 	 	13’652	 
	Alcatel
	 	France	 	 	385	 	 	 	14’162	 
	Alcoa
	 	U.S.	 	 	229	 	 	 	21’728	 
	Alliance Unichem
	 	Britain	 	 	379	 	 	 	14’385	 
	Allianz
	 	Germany	 	 	11	 	 	 	114’950	 
	Allstate
	 	U.S.	 	 	132	 	 	 	32’149	 
	Almanij
	 	Belgium	 	 	252	 	 	 	19’746	 
	Alstom
	 	France	 	 	255	 	 	 	19’627	 
	Altria Group
	 	U.S.	 	 	40	 	 	 	60’704	 
	Amerada Hess
	 	U.S.	 	 	378	 	 	 	14’408	 
	American Electric Power
	 	U.S.	 	 	347	 	 	 	15’441	 
	American Express
	 	U.S.	 	 	183	 	 	 	25’866	 
	American International Group
	 	U.S.	 	 	20	 	 	 	81’303	 
	AmerisourceBergen
	 	U.S.	 	 	63	 	 	 	49’657	 
	AMP
	 	Australia	 	 	405	 	 	 	13’516	 
	AMR
	 	U.S.	 	 	296	 	 	 	17’440	 
	Anglo American
	 	Britain	 	 	275	 	 	 	18’637	 
	Anheuser-Busch
	 	U.S.	 	 	387	 	 	 	14’147	 
	Anthem
	 	U.S.	 	 	315	 	 	 	16’771	 
	Arcelor
	 	Luxembourg	 	 	148	 	 	 	29’339	 
	Archer Daniels Midland
	 	U.S.	 	 	145	 	 	 	30’708	 
	Asahi Kasei
	 	Japan	 	 	491	 	 	 	11’098	 
	Asahi Mutual Life Insurance
	 	Japan	 	 	470	 	 	 	11’551	 
	Assicurazioni Generali
	 	Italy	 	 	29	 	 	 	66’755	 
	AstraZeneca
	 	Britain	 	 	269	 	 	 	18’849	 
	AT&T
	 	U.S.	 	 	116	 	 	 	34’529	 
	AT&T Wireless Services
	 	U.S.	 	 	317	 	 	 	16’695	 
	AutoNation
	 	U.S.	 	 	258	 	 	 	19’381	 
	Aventis
	 	France	 	 	248	 	 	 	20’162	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	Aviva
	 	Britain	 	 	42	 	 	 	59’719	 
	AXA
	 	France	 	 	13	 	 	 	111’912	 
	BAE Systems
	 	Britain	 	 	399	 	 	 	13’711	 
	Banca Intesa
	 	Italy	 	 	291	 	 	 	17’789	 
	Banco Bilbao Vizcaya Argentaria
	 	Spain	 	 	264	 	 	 	19’145	 
	Banco Bradesco
	 	Brazil	 	 	353	 	 	 	15’180	 
	Banco Do Brasil
	 	Brazil	 	 	363	 	 	 	14’844	 
	Bank of America Corp.
	 	U.S.	 	 	71	 	 	 	48’065	 
	Bank Of China
	 	China	 	 	358	 	 	 	15’022	 
	Bank of Nova Scotia
	 	Canada	 	 	453	 	 	 	11’960	 
	Bank One Corp.
	 	U.S.	 	 	233	 	 	 	21’454	 
	Barclays
	 	Britain	 	 	142	 	 	 	30’843	 
	BASF
	 	Germany	 	 	100	 	 	 	37’757	 
	Bayer
	 	Germany	 	 	129	 	 	 	32’331	 
	Bayerische Landesbank
	 	Germany	 	 	343	 	 	 	15’549	 
	BCE
	 	Canada	 	 	388	 	 	 	14’119	 
	BellSouth
	 	U.S.	 	 	216	 	 	 	22’635	 
	Berkshire Hathaway
	 	U.S.	 	 	35	 	 	 	63’859	 
	Bertelsmann
	 	Germany	 	 	266	 	 	 	19’015	 
	Best Buy
	 	U.S.	 	 	192	 	 	 	24’901	 
	Bharat Petroleum
	 	India	 	 	450	 	 	 	12’054	 
	BHP Billiton
	 	Australia	 	 	341	 	 	 	15’608	 
	BMW
	 	Germany	 	 	74	 	 	 	46’997	 
	BNP Paribas
	 	France	 	 	48	 	 	 	57’272	 
	Boeing
	 	U.S.	 	 	62	 	 	 	50’485	 
	Bombardier
	 	Canada	 	 	310	 	 	 	16’996	 
	Bouygues
	 	France	 	 	194	 	 	 	24’697	 
	BP
	 	Britain	 	 	2	 	 	 	232’571	 
	Bridgestone
	 	Japan	 	 	250	 	 	 	19’877	 
	Bristol-Myers Squibb
	 	U.S.	 	 	239	 	 	 	20’894	 
	British Airways
	 	Britain	 	 	423	 	 	 	12’806	 
	British American Tobacco
	 	Britain	 	 	253	 	 	 	19’684	 
	BT
	 	Britain	 	 	136	 	 	 	31’669	 
	Bunge
	 	U.S.	 	 	223	 	 	 	22’345	 
	Canadian Imperial Bank of Commerce
	 	Canada	 	 	459	 	 	 	11’864	 
	Canon
	 	Japan	 	 	165	 	 	 	27’592	 
	Cardinal Health
	 	U.S.	 	 	50	 	 	 	56’830	 
	Carrefour
	 	France	 	 	22	 	 	 	79’774	 
	Caterpillar
	 	U.S.	 	 	209	 	 	 	22’763	 
	Cathay Life
	 	Taiwan	 	 	395	 	 	 	13’805	 
	Cendant
	 	U.S.	 	 	282	 	 	 	18’192	 
	Central Japan Railway
	 	Japan	 	 	442	 	 	 	12’253	 
	Centrica
	 	Britain	 	 	150	 	 	 	29’313	 
	Cepsa
	 	Spain	 	 	432	 	 	 	12’589	 
	ChevronTexaco
	 	U.S.	 	 	12	 	 	 	112’937	 
	China Construction Bank
	 	China	 	 	331	 	 	 	15’825	 
	China Life Insurance
	 	China	 	 	241	 	 	 	20’782	 
	China Mobile Communications
	 	China	 	 	242	 	 	 	20’765	 
	China National Petroleum
	 	China	 	 	73	 	 	 	47’047	 
	China Telecommunications
	 	China	 	 	257	 	 	 	19’465	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	Christian Dior
	 	France	 	 	390	 	 	 	14’109	 
	Chubb
	 	U.S.	 	 	479	 	 	 	11’394	 
	Chubu Electric Power
	 	Japan	 	 	277	 	 	 	18'601	 
	Cigna
	 	U.S.	 	 	272	 	 	 	18’808	 
	Cisco Systems
	 	U.S.	 	 	268	 	 	 	18’878	 
	Citigroup
	 	U.S.	 	 	18	 	 	 	94’713	 
	CNP Assurances
	 	France	 	 	143	 	 	 	30’806	 
	Coca-Cola
	 	U.S.	 	 	237	 	 	 	21’044	 
	Coca-Cola Enterprises
	 	U.S.	 	 	299	 	 	 	17’330	 
	COFCO
	 	China	 	 	415	 	 	 	13’290	 
	Coles Myer
	 	Australia	 	 	324	 	 	 	16’043	 
	Comcast
	 	U.S.	 	 	235	 	 	 	21’263	 
	Commerzbank
	 	Germany	 	 	300	 	 	 	17’316	 
	Compass Group
	 	Britain	 	 	286	 	 	 	18’072	 
	Computer Sciences
	 	U.S.	 	 	366	 	 	 	14’768	 
	ConAgra Foods
	 	U.S.	 	 	226	 	 	 	22’053	 
	ConocoPhillips
	 	U.S.	 	 	14	 	 	 	99’468	 
	Continental
	 	Germany	 	 	419	 	 	 	13’054	 
	Corus Group
	 	Britain	 	 	420	 	 	 	13’001	 
	Cosmo Oil
	 	Japan	 	 	427	 	 	 	12’692	 
	Costco Wholesale
	 	U.S.	 	 	88	 	 	 	42’546	 
	Countrywide Financial
	 	U.S.	 	 	401	 	 	 	13’660	 
	Credit Agricole
	 	France	 	 	78	 	 	 	45’928	 
	Credit Suisse
	 	Switzerland	 	 	45	 	 	 	58’957	 
	CRH
	 	Ireland	 	 	444	 	 	 	12’194	 
	CVS
	 	U.S.	 	 	175	 	 	 	26’588	 
	Dai Nippon Printing
	 	Japan	 	 	451	 	 	 	11’988	 
	Daiei
	 	Japan	 	 	294	 	 	 	17’518	 
	Dai-ichi Mutual Life Insurance
	 	Japan	 	 	79	 	 	 	45’066	 
	DaimlerChrysler
	 	Germany	 	 	7	 	 	 	156’602	 
	Daiwa House Industry
	 	Japan	 	 	497	 	 	 	10’842	 
	Danske Bank Group
	 	Denmark	 	 	476	 	 	 	11’479	 
	Deere
	 	U.S.	 	 	344	 	 	 	15’535	 
	Delhaize Group
	 	Belgium	 	 	230	 	 	 	21’720	 
	Dell
	 	U.S.	 	 	93	 	 	 	41’444	 
	Delphi
	 	U.S.	 	 	160	 	 	 	28’096	 
	Delta Air Lines
	 	U.S.	 	 	413	 	 	 	13’303	 
	Denso
	 	Japan	 	 	213	 	 	 	22’685	 
	Dentsu
	 	Japan	 	 	345	 	 	 	15’485	 
	Deutsche Bahn
	 	Germany	 	 	133	 	 	 	31’947	 
	Deutsche Bank
	 	Germany	 	 	67	 	 	 	48’670	 
	Deutsche Post
	 	Germany	 	 	75	 	 	 	46’651	 
	Deutsche Telekom
	 	Germany	 	 	38	 	 	 	63’196	 
	Dexia Group
	 	Belgium	 	 	267	 	 	 	18’889	 
	Diageo
	 	Britain	 	 	472	 	 	 	11’538	 
	Dominion Resources
	 	U.S.	 	 	449	 	 	 	12’078	 
	Dow Chemical
	 	U.S.	 	 	125	 	 	 	32’632	 
	Duke Energy
	 	U.S.	 	 	204	 	 	 	23’483	 
	DuPont
	 	U.S.	 	 	164	 	 	 	27’730	 
	DZ Bank
	 	Germany	 	 	156	 	 	 	28’663	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	E.ON
	 	Germany	 	 	66	 	 	 	48’709	 
	EADS
	 	Netherlands	 	 	118	 	 	 	34’104	 
	East Japan Railway
	 	Japan	 	 	219	 	 	 	22’507	 
	Eastman Kodak
	 	U.S.	 	 	411	 	 	 	13’317	 
	Edison International
	 	U.S.	 	 	448	 	 	 	12’156	 
	El Paso
	 	U.S.	 	 	429	 	 	 	12’653	 
	Electricite De France
	 	France	 	 	61	 	 	 	50’838	 
	Electrolux
	 	Sweden	 	 	349	 	 	 	15’361	 
	Electronic Data Systems
	 	U.S.	 	 	232	 	 	 	21’596	 
	Eli Lilly
	 	U.S.	 	 	433	 	 	 	12’583	 
	Emerson Electric
	 	U.S.	 	 	392	 	 	 	13’999	 
	Endesa
	 	Spain	 	 	273	 	 	 	18’768	 
	Enel
	 	Italy	 	 	110	 	 	 	35’444	 
	ENI
	 	Italy	 	 	43	 	 	 	59’304	 
	Eurohypo
	 	Germany	 	 	473	 	 	 	11’536	 
	Exelon
	 	U.S.	 	 	333	 	 	 	15’812	 
	Express Scripts
	 	U.S.	 	 	414	 	 	 	13’295	 
	Exxon Mobil
	 	U.S.	 	 	3	 	 	 	222’883	 
	Fannie Mae
	 	U.S.	 	 	56	 	 	 	53’767	 
	Federated Department Stores
	 	U.S.	 	 	352	 	 	 	15’264	 
	FedEx
	 	U.S.	 	 	221	 	 	 	22’487	 
	Fiat
	 	Italy	 	 	57	 	 	 	53’500	 
	FirstEnergy
	 	U.S.	 	 	441	 	 	 	12’318	 
	FleetBoston Financial
	 	U.S.	 	 	376	 	 	 	14’442	 
	Flextronics International
	 	Singapore	 	 	374	 	 	 	14’530	 
	Fonciere Euris
	 	France	 	 	172	 	 	 	27’005	 
	Ford Motor
	 	U.S.	 	 	6	 	 	 	164’505	 
	Fortis
	 	Belgium/Netherlands	 	 	51	 	 	 	56’695	 
	Fortum
	 	Finland	 	 	422	 	 	 	12’893	 
	France Telecom
	 	France	 	 	58	 	 	 	52’198	 
	Franz Haniel
	 	Germany	 	 	180	 	 	 	26’074	 
	Freddie Mac
	 	U.S.	 	 	104	 	 	 	36’839	 
	Fuji Heavy Industries
	 	Japan	 	 	426	 	 	 	12’744	 
	Fuji Photo Film
	 	Japan	 	 	214	 	 	 	22’667	 
	Fujitsu
	 	Japan	 	 	90	 	 	 	42’201	 
	Gap
	 	U.S.	 	 	329	 	 	 	15’854	 
	Gasunie
	 	Netherlands	 	 	421	 	 	 	12’973	 
	Gaz de France
	 	France	 	 	271	 	 	 	18’841	 
	Gazprom
	 	Russia	 	 	167	 	 	 	27’527	 
	General Dynamics
	 	U.S.	 	 	318	 	 	 	16’617	 
	General Electric
	 	U.S.	 	 	9	 	 	 	134’187	 
	General Motors
	 	U.S.	 	 	5	 	 	 	195’324	 
	George Weston
	 	Canada	 	 	240	 	 	 	20’838	 
	Georgia-Pacific
	 	U.S.	 	 	246	 	 	 	20’255	 
	GlaxoSmithKline
	 	Britain	 	 	114	 	 	 	35’051	 
	Goldman Sachs Group
	 	U.S.	 	 	202	 	 	 	23’623	 
	Goodyear Tire & Rubber
	 	U.S.	 	 	356	 	 	 	15’119	 
	Great Atlantic & Pacific Tea
	 	U.S.	 	 	495	 	 	 	11’034	 
	Groupama
	 	France	 	 	283	 	 	 	18’156	 
	Groupe Auchan
	 	France	 	 	127	 	 	 	32’488	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	Groupe Caisse D’Epargne
	 	France	 	 	208	 	 	 	23’078	 
	Groupe Danone
	 	France	 	 	321	 	 	 	16’377	 
	Groupe Pinault-Printemps
	 	France	 	 	166	 	 	 	27’571	 
	GUS
	 	Britain	 	 	425	 	 	 	12’785	 
	Halliburton
	 	U.S.	 	 	322	 	 	 	16’271	 
	Hanwha
	 	South Korea	 	 	323	 	 	 	16’182	 
	Hartford Financial Services
	 	U.S.	 	 	274	 	 	 	18’733	 
	HBOS
	 	Britain	 	 	107	 	 	 	36’024	 
	HCA
	 	U.S.	 	 	228	 	 	 	21’808	 
	Health Net
	 	U.S.	 	 	492	 	 	 	11’063	 
	Hewlett-Packard
	 	U.S.	 	 	24	 	 	 	73’061	 
	Hilton Group
	 	Britain	 	 	369	 	 	 	14’599	 
	Hindustan Petroleum
	 	India	 	 	462	 	 	 	11’751	 
	Hitachi
	 	Japan	 	 	23	 	 	 	76’423	 
	Hochtief
	 	Germany	 	 	454	 	 	 	11’922	 
	Home Depot
	 	U.S.	 	 	34	 	 	 	64’816	 
	Honda Motor
	 	Japan	 	 	25	 	 	 	72’264	 
	Honeywell International
	 	U.S.	 	 	206	 	 	 	23’103	 
	HSBC Holdings
	 	Britain	 	 	47	 	 	 	57’608	 
	Humana
	 	U.S.	 	 	443	 	 	 	12’226	 
	Hutchison Whampoa
	 	China	 	 	407	 	 	 	13’474	 
	HVB Group
	 	Germany	 	 	161	 	 	 	28’083	 
	Hyundai Motor
	 	South Korea	 	 	98	 	 	 	39’101	 
	Iberdrola
	 	Spain	 	 	490	 	 	 	11’111	 
	Idemitsu Kosan
	 	Japan	 	 	292	 	 	 	17’670	 
	Indian Oil
	 	India	 	 	189	 	 	 	25’316	 
	Industrial & Commercial Bank of China
	 	China	 	 	243	 	 	 	20’757	 
	ING Group
	 	Netherlands	 	 	17	 	 	 	95’893	 
	Ingram Micro
	 	U.S.	 	 	218	 	 	 	22’613	 
	Intel
	 	U.S.	 	 	146	 	 	 	30’141	 
	International Business Machines
	 	U.S.	 	 	19	 	 	 	89’131	 
	International Paper
	 	U.S.	 	 	191	 	 	 	25’179	 
	Isuzu Motors
	 	Japan	 	 	428	 	 	 	12’663	 
	Itochu
	 	Japan	 	 	348	 	 	 	15’393	 
	lto-Yokado
	 	Japan	 	 	149	 	 	 	29’333	 
	J. Sainsbury
	 	Britain	 	 	152	 	 	 	29’035	 
	J.C. Penney
	 	U.S.	 	 	123	 	 	 	32’923	 
	J.P. Morgan Chase & Co.
	 	U.S.	 	 	81	 	 	 	44’363	 
	Japan Airlines System
	 	Japan	 	 	306	 	 	 	17’102	 
	Japan Post
	 	Japan	 	 	297	 	 	 	17’431	 
	Japan Tobacco
	 	Japan	 	 	290	 	 	 	17’881	 
	JFE Holdings
	 	Japan	 	 	227	 	 	 	21’900	 
	Johnson & Johnson
	 	U.S.	 	 	92	 	 	 	41’862	 
	Johnson Controls
	 	U.S.	 	 	215	 	 	 	22’646	 
	Kajima
	 	Japan	 	 	380	 	 	 	14’358	 
	Kansai Electric Power
	 	Japan	 	 	220	 	 	 	22’488	 
	KarstadtQuelle
	 	Germany	 	 	302	 	 	 	17’283	 
	KDDI
	 	Japan	 	 	190	 	 	 	25’197	 
	KFW Bankengruppe
	 	Germany	 	 	383	 	 	 	14’240	 
	Kimberly-Clark
	 	U.S.	 	 	381	 	 	 	14’348	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	Kingfisher
	 	Britain	 	 	373	 	 	 	14’536	 
	Kintetsu
	 	Japan	 	 	474	 	 	 	11’490	 
	Kmart Holding
	 	U.S.	 	 	203	 	 	 	23’485	 
	Kookmin Bank
	 	South Korea	 	 	357	 	 	 	15’112	 
	Korea Electric Power
	 	South Korea	 	 	265	 	 	 	19’114	 
	Kroger
	 	U.S.	 	 	55	 	 	 	53’791	 
	KT
	 	South Korea	 	 	406	 	 	 	13’485	 
	Kuraya Sanseido
	 	Japan	 	 	480	 	 	 	11’367	 
	Kyushu Electric Power
	 	Japan	 	 	439	 	 	 	12’321	 
	L.M. Ericsson
	 	Sweden	 	 	370	 	 	 	14’577	 
	La Poste
	 	France	 	 	244	 	 	 	20’376	 
	Lafarge
	 	France	 	 	346	 	 	 	15’458	 
	Lagardere Groupe
	 	France	 	 	364	 	 	 	14’791	 
	Landesbank Baden-W frttemberg
	 	Germany	 	 	260	 	 	 	19’271	 
	Lear
	 	U.S.	 	 	336	 	 	 	15’747	 
	Legal & General Group
	 	Britain	 	 	338	 	 	 	15’730	 
	Lehman Brothers Holdings
	 	U.S.	 	 	301	 	 	 	17’287	 
	LG Electronics
	 	South Korea	 	 	147	 	 	 	29’874	 
	Liberty Mutual Insurance Group
	 	U.S.	 	 	311	 	 	 	16’914	 
	Lloyds TSB Group
	 	Britain	 	 	188	 	 	 	25’378	 
	Lockheed Martin
	 	U.S.	 	 	134	 	 	 	31’844	 
	Loews
	 	U.S.	 	 	334	 	 	 	15’810	 
	L’Oréal
	 	France	 	 	327	 	 	 	15’878	 
	Lowe’s
	 	U.S.	 	 	139	 	 	 	31’263	 
	Lufthansa Group
	 	Germany	 	 	287	 	 	 	18’060	 
	Lukoil
	 	Russia	 	 	259	 	 	 	19’345	 
	Magna International
	 	Canada	 	 	328	 	 	 	15’870	 
	MAN Group
	 	Germany	 	 	309	 	 	 	17’000	 
	Manpower
	 	U.S.	 	 	445	 	 	 	12’185	 
	Manulife Financial
	 	Canada	 	 	458	 	 	 	11’887	 
	Marathon Oil
	 	U.S.	 	 	102	 	 	 	37’137	 
	Marks & Spencer
	 	Britain	 	 	391	 	 	 	14’062	 
	Marsh & McLennan
	 	U.S.	 	 	467	 	 	 	11’588	 
	Marubeni
	 	Japan	 	 	196	 	 	 	24’560	 
	Masco
	 	U.S.	 	 	489	 	 	 	11’134	 
	Mass. Mutual Life Insurance
	 	U.S.	 	 	236	 	 	 	21’076	 
	Matsushita Electric Industrial
	 	Japan	 	 	31	 	 	 	66’218	 
	May Department Stores
	 	U.S.	 	 	409	 	 	 	13’343	 
	Mazda Motor
	 	Japan	 	 	184	 	 	 	25’817	 
	MBNA
	 	U.S.	 	 	465	 	 	 	11’684	 
	McDonald’s
	 	U.S.	 	 	305	 	 	 	17’141	 
	MCI
	 	U.S.	 	 	168	 	 	 	27’331	 
	McKesson
	 	U.S.	 	 	26	 	 	 	69’506	 
	Medco Health Solutions
	 	U.S.	 	 	117	 	 	 	34’265	 
	Meiji Yasuda Life Insurance
	 	Japan	 	 	82	 	 	 	44’064	 
	Merck
	 	U.S.	 	 	222	 	 	 	22’486	 
	Merrill Lynch
	 	U.S.	 	 	163	 	 	 	27’745	 
	MetLife
	 	U.S.	 	 	106	 	 	 	36’261	 
	Metro
	 	Germany	 	 	41	 	 	 	60’657	 
	Michelin
	 	France	 	 	288	 	 	 	18’048	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	Microsoft
	 	U.S.	 	 	130	 	 	 	32’187	 
	Migros
	 	Switzerland	 	 	362	 	 	 	14’880	 
	Millea Holdings
	 	Japan	 	 	195	 	 	 	24’574	 
	Mitsubishi
	 	Japan	 	 	389	 	 	 	14’116	 
	Mitsubishi Chemical
	 	Japan	 	 	308	 	 	 	17’045	 
	Mitsubishi Electric
	 	Japan	 	 	151	 	 	 	29’300	 
	Mitsubishi Heavy Industries
	 	Japan	 	 	238	 	 	 	21’012	 
	Mitsubishi Motors
	 	Japan	 	 	224	 	 	 	22’305	 
	Mitsubishi Tokyo Financial Group
	 	Japan	 	 	217	 	 	 	22’621	 
	Mitsui
	 	Japan	 	 	177	 	 	 	26’385	 
	Mitsui Life Insurance
	 	Japan	 	 	440	 	 	 	12’319	 
	Mitsui Sumitomo Insurance
	 	Japan	 	 	279	 	 	 	18’295	 
	Mizuho Financial Group
	 	Japan	 	 	159	 	 	 	28’335	 
	Morgan Stanley
	 	U.S.	 	 	115	 	 	 	34’933	 
	Motorola
	 	U.S.	 	 	171	 	 	 	27’058	 
	Munich Re Group
	 	Germany	 	 	44	 	 	 	59’083	 
	National Australia Bank
	 	Australia	 	 	332	 	 	 	15’820	 
	National Grid Transco
	 	Britain	 	 	351	 	 	 	15’301	 
	Nationwide
	 	U.S.	 	 	313	 	 	 	16’803	 
	NEC
	 	Japan	 	 	85	 	 	 	43’440	 
	Nestle
	 	Switzerland	 	 	33	 	 	 	65’415	 
	New York Life Insurance
	 	U.S.	 	 	185	 	 	 	25’700	 
	News Corp.
	 	Australia	 	 	295	 	 	 	17’494	 
	Nippon Express
	 	Japan	 	 	367	 	 	 	14’758	 
	Nippon Life Insurance
	 	Japan	 	 	36	 	 	 	63’841	 
	Nippon Mining Holdings
	 	Japan	 	 	342	 	 	 	15’551	 
	Nippon Oil
	 	Japan	 	 	157	 	 	 	28’561	 
	Nippon Steel
	 	Japan	 	 	182	 	 	 	25’903	 
	Nippon Telegraph & Telephone
	 	Japan	 	 	16	 	 	 	98’229	 
	Nippon Yusen
	 	Japan	 	 	436	 	 	 	12’379	 
	Nissan Motor
	 	Japan	 	 	32	 	 	 	65’771	 
	Nokia
	 	Finland	 	 	122	 	 	 	33’336	 
	Nordea Bank
	 	Sweden	 	 	416	 	 	 	13’194	 
	Norsk Hydro
	 	Norway	 	 	199	 	 	 	24’276	 
	Northrop Grumman
	 	U.S.	 	 	155	 	 	 	28’686	 
	Northwestern Mutual
	 	U.S.	 	 	307	 	 	 	17’060	 
	Novartis
	 	Switzerland	 	 	193	 	 	 	24’864	 
	Obayashi
	 	Japan	 	 	455	 	 	 	11’919	 
	Office Depot
	 	U.S.	 	 	437	 	 	 	12’359	 
	Old Mutual
	 	Britain	 	 	304	 	 	 	17’145	 
	Onex
	 	Canada	 	 	438	 	 	 	12’353	 
	Otto Versand
	 	Germany	 	 	400	 	 	 	13’708	 
	PacifiCare Health Systems
	 	U.S.	 	 	496	 	 	 	11’009	 
	PDVSA
	 	Venezuela	 	 	76	 	 	 	46’000	 
	Pemex
	 	Mexico	 	 	65	 	 	 	49’240	 
	PepsiCo
	 	U.S.	 	 	173	 	 	 	26’971	 
	Petrobras
	 	Brazil	 	 	144	 	 	 	30’797	 
	Petronas
	 	Malaysia	 	 	186	 	 	 	25’661	 
	Peugeot
	 	France	 	 	39	 	 	 	61’385	 
	Pfizer
	 	U.S.	 	 	77	 	 	 	45’950	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	PG&E Corp.
	 	U.S.	 	 	488	 	 	 	11’221	 
	Plains All American Pipeline
	 	U.S.	 	 	431	 	 	 	12’590	 
	POSCO
	 	South Korea	 	 	361	 	 	 	14’930	 
	Power Corp. of Canada
	 	Canada	 	 	487	 	 	 	11’239	 
	Procter & Gamble
	 	U.S.	 	 	86	 	 	 	43’377	 
	Progressive
	 	U.S.	 	 	457	 	 	 	11’892	 
	Prudential
	 	Britain	 	 	109	 	 	 	35’473	 
	Prudential Financial
	 	U.S.	 	 	162	 	 	 	27’907	 
	PTT
	 	Thailand	 	 	456	 	 	 	11’905	 
	Public Service Enterprise Group
	 	U.S.	 	 	481	 	 	 	11’340	 
	Publix Super Markets
	 	U.S.	 	 	312	 	 	 	16’848	 
	Qwest Communications
	 	U.S.	 	 	360	 	 	 	14’936	 
	Rabobank
	 	Netherlands	 	 	200	 	 	 	24’125	 
	RAG
	 	Germany	 	 	371	 	 	 	14’559	 
	Raytheon
	 	U.S.	 	 	284	 	 	 	18’109	 
	Reliance Industries
	 	India	 	 	482	 	 	 	11’328	 
	Reliant Energy
	 	U.S.	 	 	463	 	 	 	11’707	 
	Renault
	 	France	 	 	89	 	 	 	42’470	 
	Repsol YPF
	 	Spain	 	 	91	 	 	 	42’032	 
	Ricoh
	 	Japan	 	 	335	 	 	 	15’761	 
	Rite Aid
	 	U.S.	 	 	319	 	 	 	16’600	 
	Robert Bosch
	 	Germany	 	 	94	 	 	 	41’148	 
	Roche Group
	 	Switzerland	 	 	205	 	 	 	23’213	 
	Royal & Sun Alliance
	 	Britain	 	 	262	 	 	 	19’259	 
	Royal Ahold
	 	Netherlands	 	 	37	 	 	 	63’456	 
	Royal Bank of Canada
	 	Canada	 	 	303	 	 	 	17’204	 
	Royal Bank of Scotland
	 	Britain	 	 	84	 	 	 	43’758	 
	Royal Dutch/Shell Group
	 	Britain/Netherlands	 	 	4	 	 	 	201’728	 
	Royal KPN
	 	Netherlands	 	 	377	 	 	 	14’421	 
	Royal Mail Holdings
	 	Britain	 	 	368	 	 	 	14’623	 
	Royal Philips Electronics
	 	Netherlands	 	 	124	 	 	 	32’863	 
	RWE
	 	Germany	 	 	68	 	 	 	48’407	 
	Safeway
	 	U.S.	 	 	108	 	 	 	35’553	 
	Saint-Gobain
	 	France	 	 	120	 	 	 	33’489	 
	Samsung
	 	South Korea	 	 	493	 	 	 	11’051	 
	Samsung Electronics
	 	South Korea	 	 	54	 	 	 	54’400	 
	Samsung Life Insurance
	 	South Korea	 	 	263	 	 	 	19’159	 
	San Paolo IMI
	 	Italy	 	 	402	 	 	 	13’658	 
	Santander Central Hispano Group
	 	Spain	 	 	174	 	 	 	26’957	 
	Sanyo Electric
	 	Japan	 	 	225	 	 	 	22’204	 
	Sara Lee
	 	U.S.	 	 	280	 	 	 	18’291	 
	SBC Communications
	 	U.S.	 	 	96	 	 	 	40’843	 
	Schlumberger
	 	U.S.	 	 	382	 	 	 	14’279	 
	Sears Roebuck
	 	U.S.	 	 	95	 	 	 	41’124	 
	Seiko Epson
	 	Japan	 	 	435	 	 	 	12’512	 
	Sekisui House
	 	Japan	 	 	471	 	 	 	11’545	 
	Shanghai Automotive
	 	China	 	 	461	 	 	 	11’755	 
	Shanghai Baosteel Group
	 	China	 	 	372	 	 	 	14’548	 
	Sharp
	 	Japan	 	 	249	 	 	 	19’984	 
	Shimizu
	 	Japan	 	 	397	 	 	 	13’727	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	SHV Holdings
	 	Netherlands	 	 	466	 	 	 	11’625	 
	Siemens
	 	Germany	 	 	21	 	 	 	80’501	 
	Sinochem
	 	China	 	 	270	 	 	 	18’846	 
	Sinopec
	 	China	 	 	53	 	 	 	55’062	 
	SK
	 	South Korea	 	 	119	 	 	 	33’769	 
	Skanska
	 	Sweden	 	 	320	 	 	 	16’451	 
	SNCF
	 	France	 	 	187	 	 	 	25’491	 
	Societe Generale
	 	France	 	 	158	 	 	 	28’557	 
	Sodexho Alliance
	 	France	 	 	434	 	 	 	12’532	 
	Solectron
	 	U.S.	 	 	464	 	 	 	11’700	 
	Sompo Japan Insurance
	 	Japan	 	 	314	 	 	 	16’795	 
	Sony
	 	Japan	 	 	30	 	 	 	66’366	 
	Southern
	 	U.S.	 	 	486	 	 	 	11’251	 
	Sprint
	 	U.S.	 	 	178	 	 	 	26’202	 
	Standard Life Assurance
	 	Britain	 	 	231	 	 	 	21’712	 
	Staples
	 	U.S.	 	 	417	 	 	 	13’181	 
	State Farm Insurance Cos.
	 	U.S.	 	 	52	 	 	 	56’065	 
	State Grid
	 	China	 	 	46	 	 	 	58’348	 
	Statoil
	 	Norway	 	 	112	 	 	 	35’242	 
	Stora Enso
	 	Finland	 	 	396	 	 	 	13’776	 
	Suez
	 	France	 	 	80	 	 	 	44’843	 
	Sumitomo
	 	Japan	 	 	355	 	 	 	15’126	 
	Sumitomo Electric Industries
	 	Japan	 	 	403	 	 	 	13’655	 
	Sumitomo Life Insurance
	 	Japan	 	 	103	 	 	 	36’913	 
	Sumitomo Mitsui Financial Group
	 	Japan	 	 	138	 	 	 	31’451	 
	Sun Life Financial
	 	Canada	 	 	337	 	 	 	15’741	 
	Sun Microsystems
	 	U.S.	 	 	478	 	 	 	11’434	 
	Sunoco
	 	U.S.	 	 	326	 	 	 	15’930	 
	Supervalu
	 	U.S.	 	 	247	 	 	 	20’210	 
	Suzuki Motor
	 	Japan	 	 	256	 	 	 	19’468	 
	Swiss Life Ins. & Pension
	 	Switzerland	 	 	325	 	 	 	16’036	 
	Swiss Reinsurance
	 	Switzerland	 	 	169	 	 	 	27’087	 
	Swisscom
	 	Switzerland	 	 	498	 	 	 	10’841	 
	Sysco
	 	U.S.	 	 	179	 	 	 	26’140	 
	Taisei
	 	Japan	 	 	386	 	 	 	14’152	 
	Taiyo Life Insurance
	 	Japan	 	 	484	 	 	 	11’275	 
	Target
	 	U.S.	 	 	70	 	 	 	48’163	 
	Tech Data
	 	U.S.	 	 	298	 	 	 	17’406	 
	Telecom Italia
	 	Italy	 	 	113	 	 	 	35’222	 
	Telefónica
	 	Spain	 	 	137	 	 	 	31’542	 
	Telstra
	 	Australia	 	 	430	 	 	 	12’642	 
	Tenet Healthcare
	 	U.S.	 	 	316	 	 	 	16’746	 
	Tesco
	 	Britain	 	 	59	 	 	 	51’570	 
	Thales Group
	 	France	 	 	452	 	 	 	11’962	 
	ThyssenKrupp
	 	Germany	 	 	97	 	 	 	39’188	 
	TIAA-CREF
	 	U.S.	 	 	181	 	 	 	26’016	 
	Time Warner
	 	U.S.	 	 	83	 	 	 	43’877	 
	TJX
	 	U.S.	 	 	410	 	 	 	13’328	 
	Tohoku Electric Power
	 	Japan	 	 	394	 	 	 	13’835	 
	Tokyo Electric Power
	 	Japan	 	 	87	 	 	 	42’971	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	Tokyu
	 	Japan	 	 	499	 	 	 	10’831	 
	Toppan Printing
	 	Japan	 	 	475	 	 	 	11’486	 
	Toronto-Dominion Bank
	 	Canada	 	 	500	 	 	 	10’827	 
	Toshiba
	 	Japan	 	 	64	 	 	 	49’396	 
	Total
	 	France	 	 	10	 	 	 	118’441	 
	Toyota Motor
	 	Japan	 	 	8	 	 	 	153’111	 
	Toys ‘R’ Us
	 	U.S.	 	 	469	 	 	 	11’566	 
	TPG
	 	Netherlands	 	 	408	 	 	 	13’430	 
	Travelers Property Casualty
	 	U.S.	 	 	354	 	 	 	15’139	 
	TUI
	 	Germany	 	 	210	 	 	 	22’730	 
	TXU
	 	U.S.	 	 	483	 	 	 	11’325	 
	Tyco International
	 	U.S.	 	 	105	 	 	 	36’801	 
	Tyson Foods
	 	U.S.	 	 	197	 	 	 	24’549	 
	U.S. Bancorp
	 	U.S.	 	 	350	 	 	 	15’354	 
	U.S. Postal Service
	 	U.S.	 	 	27	 	 	 	68’529	 
	UAL
	 	U.S.	 	 	398	 	 	 	13’724	 
	UBS
	 	Switzerland	 	 	72	 	 	 	47’741	 
	UFJ Holdings
	 	Japan	 	 	211	 	 	 	22’723	 
	UniCredito Italiano
	 	Italy	 	 	285	 	 	 	18’092	 
	Unilever
	 	Britain/Netherlands	 	 	69	 	 	 	48’318	 
	Union Pacific
	 	U.S.	 	 	424	 	 	 	12’792	 
	United Parcel Service
	 	U.S.	 	 	121	 	 	 	33’485	 
	United Technologies
	 	U.S.	 	 	141	 	 	 	31’034	 
	UnitedHealth Group
	 	U.S.	 	 	154	 	 	 	28’823	 
	UPM-Kymmene
	 	Finland	 	 	485	 	 	 	11’259	 
	Valero Energy
	 	U.S.	 	 	99	 	 	 	37’969	 
	Vattenfall
	 	Sweden	 	 	393	 	 	 	13’858	 
	Veolia Environnement
	 	France	 	 	128	 	 	 	32’372	 
	Verizon Communications
	 	U.S.	 	 	28	 	 	 	67’752	 
	Viacom
	 	U.S.	 	 	176	 	 	 	26’585	 
	Vinci
	 	France	 	 	234	 	 	 	21’363	 
	Visteon
	 	U.S.	 	 	293	 	 	 	17’660	 
	Vivendi Universal
	 	France	 	 	153	 	 	 	28’840	 
	Vodafone
	 	Britain	 	 	49	 	 	 	56’845	 
	Volkswagen
	 	Germany	 	 	15	 	 	 	98’637	 
	Volvo
	 	Sweden	 	 	212	 	 	 	22’692	 
	Wachovia Corp.
	 	U.S.	 	 	198	 	 	 	24’474	 
	Walgreen
	 	U.S.	 	 	126	 	 	 	32’505	 
	Wal-Mart Stores
	 	U.S.	 	 	1	 	 	 	263’009	 
	Walt Disney
	 	U.S.	 	 	170	 	 	 	27’061	 
	Washington Mutual
	 	U.S.	 	 	276	 	 	 	18’629	 
	Waste Management
	 	U.S.	 	 	468	 	 	 	11’574	 
	WellPoint Health Networks
	 	U.S.	 	 	245	 	 	 	20’360	 
	Wells Fargo
	 	U.S.	 	 	135	 	 	 	31’800	 
	Weyerhaeuser
	 	U.S.	 	 	251	 	 	 	19’873	 
	Whirlpool
	 	U.S.	 	 	446	 	 	 	12’176	 
	Williams
	 	U.S.	 	 	261	 	 	 	19’266	 
	Winn-Dixie Stores
	 	U.S.	 	 	447	 	 	 	12’168	 
	Wolseley
	 	Britain	 	 	418	 	 	 	13’085	 
	Woolworths
	 	Australia	 	 	340	 	 	 	15’682	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Revenues
	Company	 	Country	 	Rank	 	[USD mio]
	Wyeth
	 	U.S.	 	 	330	 	 	 	15’851	 
	Xerox
	 	U.S.	 	 	339	 	 	 	15’701	 
	Yukos
	 	Russia	 	 	359	 	 	 	14’966	 
	Zurich Financial Services
	 	Switzerland	 	 	60	 	 	 	51’357	 

 

 

Appendix C

			
	 	 	 
	Pharmaceutical / medical risks
	 	(Version 2005-Apr)

	 	 	 	 	 
	#	 	Company Name	 	Headquarter location
	1

	 	ABBOTT LABORATORIES
	 	USA
	2

	 	AKZO NOBEL
	 	Netherlands
	3

	 	ALLERGAN
	 	USA
	4

	 	ALPHARMA
	 	USA
	5

	 	ALTANAAG
	 	Germany
	6

	 	AMGEN
	 	USA
	7

	 	ASTELLAS
	 	Japan
	8

	 	ASTRAZENECA
	 	UK
	9

	 	BARR LABORATORIES
	 	USA
	10

	 	BAXTER INTERNATIONAL
	 	USA
	11

	 	BAYER
	 	Germany
	12

	 	BEAUFOUR IPSEN
	 	France
	13

	 	BIOGEN
	 	USA
	14

	 	BIOMET
	 	USA
	15

	 	BOEHRINGER INGELHEIM
	 	Germany
	16

	 	BOSTON SCIENTIFIC CORPORATION
	 	USA
	17

	 	BRISTOL-MYERS SQUIBB
	 	USA
	18

	 	CHIRON
	 	USA
	19

	 	CSL
	 	Australia
	20

	 	DAIICHI PHARMACEUTICAL
	 	Japan
	21

	 	DAINIPPON PHARMACEUTICAL
	 	Japan
	22

	 	EDWARDS LIFESCIENCES
	 	USA
	23

	 	EISAI
	 	Japan
	24

	 	ELAN
	 	Ireland
	25

	 	FOREST LABORATORIES
	 	USA
	26

	 	GENENTECH
	 	USA
	27

	 	GENERAL ELECTRIC Healthcare
	 	USA
	28

	 	GENZYME
	 	USA
	29

	 	GLAXOSMITHKLINE
	 	UK
	30

	 	GUIDANT
	 	USA
	31

	 	HOSPIRA
	 	USA
	32

	 	IVAX
	 	USA
	33

	 	JOHNSON & JOHNSON
	 	USA
	34

	 	KING PHARMACEUTICALS
	 	USA
	35

	 	KYOWA HAKKO KOGYO
	 	Japan
	36

	 	LABORATOIRE SERVIER
	 	France
	37

	 	LILLY (ELI)
	 	USA
	38

	 	LUNDBECK
	 	Denmark
	39

	 	MEDIMMUNE
	 	USA
	40

	 	MEDTRONIC
	 	USA
	41

	 	MERCK & CO
	 	USA
	42

	 	MERCK KGAA
	 	Germany
	43

	 	MINNESOTA MINING & MANUFACTURING
	 	USA
	44

	 	MYLAN LABORATORIES
	 	USA
	45

	 	NOVARTIS
	 	Switzerland
	46

	 	NOVO NORDISK
	 	Denmark
	47

	 	OTSUKA PHARMACEUTICAL
	 	Japan
	48

	 	PFIZER
	 	USA
	49

	 	PLIVA
	 	Croatia
	50

	 	PROCTER & GAMBLE
	 	USA

 

 

	 	 	 	 	 
	#	 	Company Name	 	Headquarter location
	51

	 	PURDUE FREDERICK / PRA Holding
	 	USA
	52

	 	ROCHE
	 	Switzerland
	53

	 	SANKYO
	 	Japan
	54

	 	SANOFI-AVENTIS
	 	France
	55

	 	SCHERING AG
	 	Germany
	56

	 	SCHERING-PLOUGH
	 	USA
	57

	 	SCHWARZ PHARMA
	 	Germany
	58

	 	SERONO
	 	Switzerland
	59

	 	SHIONOGI
	 	Japan
	60

	 	SHIRE PHARMACEUTICALS
	 	UK
	61

	 	SMITH & NEPHEW
	 	UK
	62

	 	SOLVAY
	 	Belgium
	63

	 	ST.JUDE MEDICAL
	 	USA
	64

	 	STRYKER
	 	USA
	65

	 	SUMITOMO PHARMACEUTICALS
	 	Japan
	66

	 	SYNTHES-STRATEC
	 	Switzerland
	67

	 	TAKEDA
	 	Japan
	68

	 	TANABE
	 	Japan
	69

	 	TAP Pharmaceutical Products
	 	USA
	70

	 	TEVA PHARMACEUTICAL
	 	Israel
	71

	 	TYCO Healthcare
	 	USA
	72

	 	UCB
	 	Belgium
	73

	 	WATSON PHARMACEUTICAL
	 	USA
	74

	 	WYETH
	 	USA
	75

	 	ZIMMER
	 	USA

 

 

SUPPLEMENT TO THE ATTACHMENTS

DEFINITION OF IDENTIFICATION TERMS USED WITHIN THE ATTACHMENTS

	A.	 	Wherever the term “Company” or “Reinsured” or “Reassured” or whatever other term is used to
designate the reinsured company or companies within the various attachments to the reinsurance
agreement, the term shall be understood to mean Company or Reinsured or Reassured or whatever
other term is used in the attached reinsurance agreement to designate the reinsured company or
companies.

	B.	 	Wherever the term “Agreement” or “Agreement” or “Policy” or whatever other term is used to
designate the attached reinsurance agreement within the various attachments to the reinsurance
agreement, the term shall be understood to mean Agreement or Agreement or Policy or whatever
other term is used to designate the attached reinsurance agreement.

	C.	 	Wherever the term “Reinsurer” or “Reinsurers” or “Underwriters” or whatever other term is
used to designate the reinsurer or reinsurers in the various attachments to the reinsurance
agreement, the term shall be understood to mean Reinsurer or Reinsurers or Underwriters or
whatever other term is used to designate the reinsuring company or companies.

INSOLVENCY FUNDS EXCLUSION CLAUSE

This Agreement excludes all liability of the Company arising by Agreement, operation of law, or
otherwise from its participation or membership, whether voluntary or involuntary, in any
insolvency fund or from reimbursement of any person for any such liability. “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 any person 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.

 

 

	 	 	NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY — REINSURANCE — U.S.A. N.M.A. 1590

	1.	 	This reinsurance does not cover any loss or liability accruing to the Reassured as a member
of, or subscriber to, any association of insurers or reinsurers formed for the purpose of
covering nuclear energy risks or as a direct or indirect reinsurer of any such member,
subscriber or association.

	2.	 	Without in any way restricting the operation of paragraph 1. of this Clause it is understood
and agreed that for all purposes of this reinsurance all the original policies of the
Reassured (new, renewal and replacement) of the classes specified in Clause II. in this
paragraph 2. from the time specified in Clause III. in this paragraph 2. shall be deemed to
include the following provision (specified as the Limited Exclusion Provision):

	 	 	LIMITED EXCLUSION PROVISION*

	 	I.	 	It is agreed that the policy does not apply under any liability coverage, to
injury, sickness, disease, death or destruction, bodily injury or property damage with
respect to which an insured under the policy is also an insured under a nuclear energy
liability policy issued by Nuclear Energy Liability Insurance Association, Mutual Atomic
Energy Liability Underwriters or Nuclear Insurance Association of Canada, or would be an
insured under any such policy but for its termination upon exhaustion of its limit of
liability.
	 
	 	II.	 	Family Automobile Policies (liability only), Special Automobile Policies
(private passenger automobiles, liability only), Farmers Comprehensive Personal
Liabilities Policies (liability only), Comprehensive Personal Liability Policies
(liability only) or policies of a similar nature; and the liability portion of
combination forms related to the four classes of policies stated above, such as the
Comprehensive Dwelling Policy and the applicable types of Homeowners Policies.
	 
	 	III.	 	The inception dates and thereafter of all original policies as described in II.
above, whether new, renewal or replacement, being policies which either

	 	(a)	 	become effective on or after 1st May, 1960, or
	 
	 	(b)	 	become effective before that date and contain the Limited Exclusion Provision
set out above; provided this paragraph 2. shall not be applicable to Family Automobile
Policies, Special Automobile Policies, or policies or combination policies of a
similar nature, issued by the Reassured on New York risks, until 90 days following
approval of the Limited Exclusion Provision by the Governmental Authority having
jurisdiction thereof.

	3.	 	Except for those classes of policies specified in Clause II. of paragraph 2. and without in
any way restricting the operation of paragraph 1. of this Clause, it is understood and agreed
that for all purposes of this reinsurance the original liability policies of the Reassured
(new, renewal and replacement) affording the following coverages:

	 	 	Owners, Landlords and Tenants Liability, Agreementual Liability, Elevator Liability, Owners
or Agreementors (including railroad) Protective Liability, Manufacturers and Agreementors
Liability, Product Liability, Professional and Malpractice Liability, Storekeepers Liability,
Garage Liability, Automobile Liability (including Massachusetts Motor Vehicle or Garage
Liability)

	 	 	shall be deemed to include with respect to such coverages, from the time specified in Clause
V. of this paragraph 3., the following provision (specified as the Broad Exclusion
Provision):

	 	 	BROAD EXCLUSION PROVISION*

N.M.A. 1590

 

 

	 	 	It is agreed that the policy does not apply:

	 	I.	 	Under any Liability Coverage to injury, sickness, disease, death or destruction,
bodily injury or property damage

	 	(a)	 	with respect to which an insured under the policy is also an insured under
nuclear energy liability policy issued by Nuclear Energy Liability Insurance
Association, Mutual Atomic Energy Liability Underwriters or Nuclear Insurance
Association of Canada, or would be an insured under any such policy but for its
termination upon exhaustion of its limit of liability; or
	 
	 	(b)	 	resulting from the hazardous properties of nuclear material and with respect
to which (1) any person or organization is required to maintain financial protection
pursuant to the Atomic Energy Act of 1954, or any law amendatory thereof, or (2) the
insured is, or had this policy not been issued would be, entitled to indemnity from
the United States of America, or any agency thereof, under any agreement entered into
by the United States of America, or any agency thereof, with any person or
organization.

	 	II.	 	Under any Medical Payments Coverage, or under any Supplementary Payments Provision
relating to immediate medical or surgical relief, first aid, to expenses incurred with
respect to bodily injury, sickness, disease or death, bodily injury resulting from the
hazardous properties of nuclear material and arising out of the question of a nuclear
facility by any person or organization.
	 
	 	III.	 	Under any Liability Coverage, to injury, sickness, disease, death or destruction,
bodily injury or property damage resulting from the hazardous properties of nuclear
material, if

	 	(a)	 	the nuclear material (1) is at any nuclear facility owned by, or operated by or
on behalf of, an insured or (2) has been discharged or dispersed therefrom;
	 
	 	(b)	 	the nuclear material is contained in spent fuel or waste at any time possessed,
handled, used, processed, stored, transported or disposed of by or on behalf of an
insured; or
	 
	 	(c)	 	the injury, sickness, disease, death or destruction, bodily injury or property
damage arises out of the furnishing by an insured of services, materials, parts or
equipment in connection with the planning, construction, maintenance, operation or use
of any nuclear facility, but if such facility is located within the United States of
America, its territories, or possessions or Canada, this exclusion (c) applies only to
injury to or destruction of property at such nuclear facility, property damage to such
nuclear facility and any property threat.

	 	IV.	 	As used in this endorsement:

	 	 	 	“hazardous properties” include radioactive, toxic or explosive properties; “nuclear
material” means source material, special nuclear material or byproduct material;
“source material,” “special nuclear material,” and “byproduct material” have the
meanings given them in the Atomic Energy Act of 1954 or in any law amendatory
thereof; “spent fuel” means any fuel element or fuel component, solid or liquid,
which has been used or exposed to radiation in a nuclear reactor; “waste” means any
waste material (1) containing byproduct material other than the tailings or wastes
produced by the extraction or concentration of uranium or thorium from any ore
processed for its source material
	 
	 	 	 	content and (2) resulting from the operation by any person or organization of any
nuclear facility included within the definition of nuclear facility under paragraph
(a) or (b) thereof; “nuclear facility” means

	 	(a)	 	any nuclear reactor,

N.M.A. 1590

 

 

	 	(b)	 	any equipment or device designed or used for (1) separating the
isotopes of uranium or plutonium, (2) processing or utilizing spent fuel, or
(3) handling, processing or packaging waste,
	 
	 	(c)	 	any equipment or device used for the processing, fabricating or
alloying of special nuclear material if at any time the total amount of such
material in the custody of the insured at the premises where such equipment or
device is located consists of or contains more than 25 grams of plutonium or
uranium 233 or any combination thereof, or more than 250 grams of uranium 235,
	 
	 	(d)	 	any structure, basin, excavation, premises or place prepared or
used for the storage or disposal of waste

	 	 	 	and includes the site on which any of the foregoing is located, all operations
conducted on such site and all premises used for such operations; “nuclear reactor”
means any apparatus designed or used to sustain nuclear fission in a
self-supporting chain reaction or to contain a critical mass of fissionable
material; with respect to injury to or destruction of property, the word “injury”
or “destruction” includes all forms of radioactive contamination of property;
“property damage” includes all forms of radioactive contamination of property.

	 	V.	 	The inception dates and thereafter of all original policies affording coverages
specified in this paragraph 3., whether new, renewal or replacement, being policies
which become effective on or after 1st May, 1960, provided this paragraph 3. shall not
be applicable to

	 	(i)	 	Garage and Automobile Policies issued by the Reassured on New York risks, or
	 
	 	(ii)	 	Statutory liability insurance required under Chapter 90,
General Laws of Massachusetts, until 90 days following approval of the Broad
Exclusion Provision by the Governmental Authority having jurisdiction thereof.

	4.	 	Without in any way restricting the operations of paragraph 1. of this Clause, it is
understood and agreed that paragraphs 2. and 3. above are not applicable to original
liability policies of the Reassured in Canada, and that with respect to such policies, this
Clause shall be deemed to include the Nuclear Energy Liability Exclusion Provisions adopted
by the Canadian Underwriters’ Association or the Independent Insurance Conference of Canada.

	*NOTE:	 	The words printed in BOLD TYPE in the Limited Exclusion Provision and in the Broad
Exclusion Provision shall apply only in relation to original liability policies which include
a Limited Exclusion Provision or a Broad Exclusion Provision containing those words.

N.M.A. 1590

 

 

	 	 	NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY — REINSURANCE — CANADA
	 
	 	 	N.M.A. 1979

	1.	 	This Agreement does not cover any loss or liability accruing to the Company as a member of,
or subscriber to, any association of insurers or reinsurers formed for the purpose of covering
nuclear energy risks or as a direct or indirect reinsurer of any such member, subscriber or
association.

	2.	 	Without in any way restricting the operation of Paragraph 1. of this Clause, it is agreed
that for all purposes of this Agreement all the original liability Agreements of the Company,
whether new, renewal or replacement, of the following classes, namely,

	 	 	 	Personal Liability

Farmers’ Liability

Storekeepers’
Liability

	 	 	which become effective on or after 31st December 1984, shall be deemed to include, from their
inception dates and thereafter, the following provision:

	 	 	Limited Exclusion Provision —

	 	 	This Policy does not apply to bodily injury or property damage with respect to which the
Insured is also insured under a Agreement of nuclear energy liability insurance (whether the
Insured is unnamed in such Agreement and whether or not it is legally enforceable by the
Insured) issued by the Nuclear Insurance Association of Canada or any other group or pool of
insurers or would be an Insured under any such policy but for its termination upon exhaustion
of its limits of liability.

	 	 	With respect to property, loss of use of such property shall be deemed to be property damage.

	3.	 	Without in any way restricting the operation of Paragraph 1. of this Clause, it is agreed
that for all purposes of this Agreement all the original liability Agreements of the Company,
whether new, renewal or replacement, of any class whatsoever (other than Personal Liability,
Farmers’ Liability, Storekeepers’ Liability or Automobile Liability Agreements), which become
effective on or after 31st December 1984, shall be deemed to include, from their inception
dates and thereafter, the following provision:

	 	 	Broad Exclusion Provision —

	 	 	It is agreed that this Policy does not apply:

	 	(a)	 	to liability imposed by or arising under the Nuclear Liability Act; nor
	 
	 	(b)	 	to bodily injury or property damage with respect to which an Insured under this
Policy is also insured under a Agreement of nuclear energy liability insurance (whether
the Insured is unnamed in such Agreement and whether or not it is legally enforceable by
the Insured) issued by the Nuclear Association of Canada or any other insurer or group or
pool of insurers or would be an Insured under any such policy but for its termination
upon exhaustion of its limit of liability; nor
	 
	 	(c)	 	to bodily injury or property damage resulting directly or indirectly from the
nuclear energy hazard arising from:

	 	(i)	 	the ownership, maintenance, operation or use of a nuclear facility by or on behalf of an Insured;

N.M.A. 1979

 

 

	 	(ii)	 	the furnishing of an Insured of services, materials, parts or equipment in connection with the planning, construction, maintenance, operation or use of
any nuclear facility; and
	 
	 	(iii)	 	the possession, consumption, use, handling, disposal or transportation of fissionable substances, or of other radioactive material (except radioactive
isotopes, away from a nuclear facility, which have reached the final stage of
fabrication so as to be usable for any scientific, medical, agricultural,
commercial or industrial purpose) used, distributed, handled or sold by an
Insured.

As used in this Policy:

	(1)	 	The term “nuclear energy hazard” means the radioactive, toxic, explosive, or other
hazardous properties of radioactive material;

	(2)	 	The term “radioactive material” means uranium, thorium, plutonium,
neptunium, their respective derivatives and compounds, radioactive isotopes of other
elements and any other substances that the Atomic Energy Control Board may, by
regulation, designate as being prescribed substances capable of releasing atomic energy,
or as being requisite for the production, use or application of atomic energy;

	(3)	 	The term “nuclear facility” means:

	 	(a)	 	any apparatus designed or used to sustain nuclear fission in a
self-supporting chain reaction or to contain a critical mass of plutonium, thorium
and uranium or any one or more of them;
	 
	 	(b)	 	any equipment or device designed or used for (i) separating the isotopes
of plutonium, thorium and uranium or any one or more of them, (ii) processing or
utilizing spent fuel, or (iii) handling, processing or packaging waste;
	 
	 	(c)	 	any equipment or device used for the processing, fabricating or alloying
of plutonium, thorium or uranium enriched in the isotope uranium 233 or in the
isotope uranium 235, or any one or more of them if at any time the total amount of
such material in the custody of the Insured at the premises where such equipment or
device is located consists of or contains more than 25 grams of plutonium or uranium
233 or any combination thereof, or more than 250 grams of uranium 235;
	 
	 	(d)	 	any structure, basin, excavation, premises or place prepared or used for
the storage or disposal of waste radioactive material; and includes the site on
which any of the foregoing is located, together with all operations conducted
thereon and all premises used for such operations.

	(4)	 	The term “fissionable substance” means any prescribed substance that is, or from
which can be obtained, a substance capable of releasing atomic energy by nuclear fission.

	(5)	 	With respect to property, loss of use of such property shall be deemed to be property
damage.

N.M.A. 1979

 

 

NUCLEAR INCIDENT EXCLUSION CLAUSE — REINSURANCE — NO. 4

	1.	 	This Reinsurance does not cover any loss or liability accruing to the Reassured as a member
of, or subscriber to, any association of insurers or reinsurers formed for the purpose of
covering nuclear energy risks or as a direct or indirect reinsurer of any such member,
subscriber or association.

	2.	 	Without in any way restricting the operations of Nuclear Incident Exclusion Clauses, —
Liability, — Physical Damage, — Boiler and Machinery and paragraph 1. of this Clause, it is
understood and agreed that for all purposes of the reinsurance assumed by the Reinsurer from
the Reinsured, all original insurance policies or Agreements of the Reinsured (new, renewal
and replacement) shall be deemed to include the applicable existing Nuclear Clause and/or
Nuclear Exclusion Clause(s) in effect at the time and any subsequent revisions thereto as
agreed upon and approved by the Insurance Industry and/or a qualified Advisory or Rating
Bureau.

 

 

INTERESTS AND LIABILITIES CONTRACT

to the

CASUALTY EXCESS OF LOSS

REINSURANCE AGREEMENT

NO. RAM Re SumCX — 2006

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(herinafter referred to as the “Subscribing Reinsurer”)

It is hereby agreed by and between the Company on the one part and the Subscribing Reinsurer on the
other part that the Subscribing Reinsurer’s share in the interests and liabilities of the
Reinsurers as set forth in the attached Casualty Excess of Loss Reinsurance Agreement No. RAM Re
SumCX — 2006 effective 12:01 a.m., Local Standard Time, January 1, 2006, to which this Contract is
attached shall be for:

	 	 	 	 	 

	Exhibit A — First Excess of Loss
	 	 	100.0	%
	Exhibit B — Second Excess of Loss
	 	 	100.0	%
	Exhibit C — Third Excess of Loss
	 	 	100.0	%

The share of the Subscribing Reinsurer in the interests and liabilities of all Reinsurers
participating in said Agreement shall be separate and apart from the shares of such other
Reinsurers to the said Agreement. The interests and liabilities of the Subscribing Reinsurer shall
not be joint with those of the other Reinsurers and in no event shall the Subscribing Reinsurer
participate in the interests and liabilities of the other Reinsurers participating in said
Agreement.

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Contract to be executed by their duly
authorized representative.

In Lakeland, Florida, this 25th day of September, 2006.

	 	 	 

	ATTEST:

	 	BRIDGEFIELD CASUALTY INSURANCE COMPANY
	 

	 	BRIDGEFIELD EMPLOYERS INSURANCE COMPANY
	 
	 	 
	/s/

	 	/s/
	 

	 	 

And in Keene, New Hampshire, this 7th day of September, 2006.

	 	 	 

	ATTEST:

	 	PEERLESS INSURANCE COMPANY
	 
	 	 
	/s/

	 	/s/ Nancy C. Callender
	 

	 	 

 

 

ENDORSEMENT NO. 1

to the

INTERESTS AND LIABILITIES CONTRACT

(hereinafter referred to as the “Contract”)

of the

CASUALTY EXCESS OF LOSS

REINSURANCE AGREEMENT

No. RAM Re SumCX — 2006

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(hereinafter referred to as the “Reinsurer”)

It is understood and agreed that Addendum No. 1 to the Casualty Excess of Loss Reinsurance
Agreement No. RAM Re SumCX — 2006 is attached hereto and made a part of said Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Endorsement to be executed in duplicate, by
their duly authorized representatives.

In Lakeland, Florida, this 13th day of November, 2007.

	 	 	 

	ATTEST:

	 	BRIDGEFIELD CASUALTY INSURANCE COMPANY
	 

	 	BRIDGEFIELD EMPLOYERS INSURANCE COMPANY
	 
	 	 
	/s/

	 	/s/
	 

	 	 

And in Keene, New Hampshire, this 6th day of November, 2007.

	 	 	 

	ATTEST:

	 	PEERLESS INSURANCE COMPANY
	 
	 	 
	/s/

	 	/s/ Nancy C. Callender
	 

	 	 

No. RAM Re SumCX — 2006

Endorsement No. 1

 

 

ADDENDUM NO. 1

to the

CASUALTY EXCESS OF LOSS

REINSURANCE AGREEMENT

No. RAM Re SumCX — 2006

(hereinafter referred to as the “Agreement”)

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(hereinafter referred to as the “Reinsurer”)

It is understood and agreed that effective 12:01 a.m., Local Standard Time, January 1, 2007, this
Agreement is terminated in accordance with the provisions of Article II — Effective Date and
Termination.

No. RAM Re SumCX — 2006

Addendum No. 1exv10w153

EXHIBIT
10.153

WORKERS COMPENSATION EXCESS OF LOSS

REINSURANCE AGREEMENT

EFFECTIVE JANUARY 1, 2000

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

CAS00SHI01

 

 

WORKERS COMPENSATION EXCESS OF LOSS REINSURANCE AGREEMENT

	 	 	 	 	 	 	 	 	 
	ARTICLE	 	 	CONTENTS	 	PAGE
	 	 	 	 	PREAMBLE
	 	 	1	 
	I	 	COMMENCEMENT AND TERMINATION
	 	 	1	 
	II	 	BUSINESS COVERED
	 	 	1	 
	III	 	TERRITORY
	 	 	2	 
	IV	 	LIMITS OF COVER
	 	 	2	 
	V	 	REINSURANCE PREMIUM
	 	 	2	 
	VI	 	ULTIMATE NET LOSS
	 	 	3	 
	VII	 	REPORTS AND REMITTANCES
	 	 	4	 
	VIII	 	EXTRA CONTRACTUAL OBLIGATIONS
	 	 	4	 
	IX	 	EXCESS JUDGMENTS
	 	 	5	 
	X	 	DEFINITIONS OF OCCURRENCE
	 	 	5	 
	XI	 	ORIGINAL CONDITIONS
	 	 	6	 
	XII	 	EXCLUSIONS
	 	 	6	 
	XIII	 	INADVERTENT BINDING
	 	 	8	 
	XIV	 	WARRANTY
	 	 	8	 
	XV	 	CLAIMS
	 	 	9	 
	XVI	 	SUBROGATION AND SALVAGE
	 	 	9	 
	XVII	 	RESERVES AND TAXES
	 	 	10	 
	XVIII	 	ACCESS TO RECORDS
	 	 	10	 
	XIX	 	INSOLVENCY
	 	 	10	 
	XX	 	OFFSET
	 	 	11	 
	XXI	 	ARBITRATION
	 	 	11	 
	XXII	 	CURRENCY
	 	 	12	 
	XXIII	 	SEVERABILITY
	 	 	12	 
	XXIV	 	ERRORS AND OMISSIONS
	 	 	12	 
	XXV	 	SERVICE OF SUIT
	 	 	13	 
	XXVI	 	ENTIRE AGREEMENT
	 	 	13	 
	XXVII	 	GOVERNING LAW
	 	 	13	 
	 	 	 	 	SIGNATURES
	 	 	14	 

ATTACHMENTS: NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY —
REINSURANCE — U.S.A.

NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY —
REINSURANCE — CANADA

NUCLEAR INCIDENT EXCLUSION CLAUSE —
REINSURANCE — NO. 4

 

 

WORKERS COMPENSATION EXCESS OF LOSS

REINSURANCE AGREEMENT

(hereinafter referred to as the “Agreement”)

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

ARTICLE I — COMMENCEMENT AND TERMINATION

	A.	 	This Agreement shall become effective with respect to new and renewal Policies becoming
effective on and after 12:01 a.m., January 1, 2000 and shall remain in full force until
terminated. This Agreement may be terminated at the dose of any calendar quarter by either
party giving to the other 90 days prior written notice by certified mail of its intention to
do so.
	 
	B.	 	During the running of such notice as stipulated in Paragraph A. above, the Reinsurer shall
participate in business coming within the terms of this Agreement until the date of
termination of this Agreement.
	 
	C.	 	In the event of termination of this Agreement, the Company shall have the option of
continuing or terminating the liability in force at the date of termination as set forth
below. The Company may exercise such option provided written notice of the Company’s election
is given by certified mail to the Reinsurer prior to the date of termination.

	 	1.	 	All Policies covered hereunder and in force at the date of termination of this
Agreement shall continue until their natural expiry, cancellation or next anniversary of
such business, whichever first occurs; but in no case shall this reinsurance be extended
for longer than one year, after the termination date. At such time, the Reinsurer shall
return to the Company the unearned premiums, less commissions applicable, for the
unexpired periods.
	 
	 	2.	 	All reinsurance hereunder shall be automatically cancelled as of the date of
termination and the Reinsurer shall be released of all liability as respects losses
occurring subsequent to the date of termination. The Reinsurer shall return to the
Company the unearned premiums on the business in force hereunder at the date of
termination, less the commission allowed thereon.

ARTICLE II — BUSINESS COVERED

	A.	 	The Reinsurer agrees to reimburse the Company, on an excess of loss basis, for the
amounts of Ultimate Net Loss which the Company may pay as a result of losses occurring on and
after

1.

 

	 	 	12:01 a.m., January 1, 2000, as respects the Company’s new and renewal Policies becoming
effective on and after said date, covering Workers Compensation and Employers Liability Policies,
including Occupational Disease and Cumulative Injury, except as excluded under Article XII —
Exclusions.
	 
	B.	 	The term “Policies” as used herein means each of the Company’s binders, policies and contracts,
whether written or oral, and providing insurance on the Business covered hereunder.

ARTICLE III — TERRITORY

This Agreement shall follow the territorial limits of the original Policies of the Company.

ARTICLE IV — LIMITS OF COVER

Part I — First Casualty Excess of Loss

The Company shall retain the first $500,000 of Ultimate Net Loss as respects any one Loss
Occurrence. The Reinsurer shall then be liable for the amount by which the Company’s Ultimate Net
Loss exceeds the Company’s retention of $500,000, but the liability of the Reinsurer shall never
exceed $1,500,000 with respect to any one Loss Occurrence.

Part II — Casualty Second Excess of Loss

The Company shall retain the first $2,000,000 of Ultimate Net Loss as respects any one Loss
Occurrence. The Reinsurer shall then be liable for the amount by which the Company’s Ultimate Net
Loss exceeds the Company’s retention of $2,000,000, but the liability of the Reinsurer shall never
exceed $8,000,000 with respect to any one Loss Occurrence.

Part III — Casualty Third Excess of Loss

The Company shall retain the first $10,000,000 of Ultimate Net Loss as respects any one Loss
Occurrence. The Reinsurer shall then be liable for the amount by which the Company’s Ultimate Net
Loss exceeds the Company’s retention of $10,000,000, but the liability of the Reinsurer shall never
exceed $15,000,000 with respect to any one Loss Occurrence.

ARTICLE V — REINSURANCE PREMIUM

	A.	 	The Company shall pay to the Reinsurer a premium for the reinsurance provided under Parts I, II
and III of Article IV at the rates set forth below. Such rates shall be applied to the Company’s
Subject Earned Premium for the monthly period being reported.
	 
	 	 	Part I

	 	 	 	 	 
	 	 	Rate
	First Excess of Loss
	 	 	2.75	%
	 
	 	 	 	 
	Part II
	 	 	 	 

2.

 

	 	 	 	 	 
	 	 	Rate
	Second Excess of Loss
	 	 	1.08	%
	 
	 	 	 	 
	Part III
	 	 	 	 

	 	 	 	 	 
	 	 	Rate
	Third Excess of Loss
	 	 	0.17	%

	B.	 	The term “Subject Earned Premium” as used herein is equal to the sum of the Net Premium
Written on the business covered hereunder during the period under consideration, plus the
unearned premium reserve as respects premiums in force at the beginning of such period,
less the unearned premium reserve as respects premium in force at the end of the period,
said unearned premium is to be calculated on a monthly pro rata basis.
	 
	C.	 	The term “Net Premiums Written” shall mean gross premiums written less returns,
allowances and reinsurance which inure to the benefit of the Reinsurer.

ARTICLE VI — ULTIMATE NET LOSS

	A.	 	The term “Ultimate Net Loss” as used in this Agreement shall mean the actual loss paid by
the Company, or for which the Company becomes liable to pay; including such amounts paid
to managed care service providers for the medical portion of losses for those clients electing
managed care, such toss to include expenses of investigation, litigation and interest
(including interest accrued prior to judgment where such interest is added to the judgment
and interest accrued subsequent to judgment) and all such legal expenses and costs incurred
by the Company in connection with policy coverage questions and legal actions connected
thereto and all other loss expense of the Company including subrogation, salvage, and
recovery expenses, and including a pro rata share of salaries of the Company’s field
employees, pro rated in accordance with the time occupied in adjusting such loss, and
including expenses of the Company’s officials and employees incurred in connection with the
loss. However, salaries of the Company’s officials and office expenses of the Company shall
not be included. Said loss shall also include any self insured retention or deductible of any
original policyholder of the Company and shall further include 100% of Extra Contractual
Obligations as provided for in the Extra Contractual Obligations Article of this Agreement and
100% of loss in excess of the original policy limits as provided for in the Excess of Original
Policy Limits Article of this Agreement. Salvages and all other recoveries actually received
by
the Company, shall be first deducted from such loss to arrive at the amount of liability
attaching hereunder. All salvages, recoveries or payments recovered or received subsequent
to Loss Settlement hereunder shall be applied as if recovered or received prior to the
aforesaid settlement and all necessary adjustments shall be made by the parties hereto.
Nothing in this Article shall be construed to mean that losses are not recoverable hereunder
until the Company’s Ultimate Net Loss has been ascertained. In the event of the insolvency
of the Company, “Ultimate Net Loss” shall mean the amount of loss which the Company has
incurred or for which it is liable, and payment by the Reinsurer shall be made to the
liquidator, receiver or statutory successor of the Company in accordance with the provisions
of Article XIX — Insolvency of this Agreement.
	 
	B.	 	All expenses incurred by the Company which are included as a part of the policy limit under
the Company’s original Policies reinsured hereunder shall be included in Ultimate Net Loss as
defined above.

3.

 

	C.	 	All expenses other than as provided above, including taxed court costs, prejudgment and
postjudgment interest, and loss expenses incurred in investigation, adjustment, including
independent adjusters, litigation, declaratory judgment expenses, defense and settlement of
claims made against the Company under its Policies reinsured hereunder, shall be included as
part of Ultimate Net Loss.

ARTICLE VII — REPORTS AND REMITTANCES

	A.	 	The Company shall furnish the Reinsurer with all necessary data respecting premiums and
losses for as long as one of the parties hereto has a claim against the other arising from
this Agreement.
	 
	B.	 	Within 30 days after the close of each calendar month, the Company shall submit an account to
the Reinsurer summarizing Subject Earned Premium by annual statement line of business, and the
reinsurance premium due. Such reinsurance premium shall be remitted within 45 days after the
close of each calendar quarter.
	 
	C.	 	Payment by the Reinsurer of its portion of loss and loss expenses paid by the Company will be
made by the Reinsurer to the Company within 15 business days after proof of payment by the
Company is received by the Reinsurer.

ARTICLE VIII — EXTRA CONTRACTUAL OBLIGATIONS

	A.	 	This Agreement shall protect the Company within the limits hereof where the Ultimate Net Loss
includes Extra Contractual Obligations.
	 
	B.	 	“Extra Contractual Obligations” are defined as those liabilities that are not covered under
any other provision of this Agreement which arise from the handling of any claim on business
covered hereunder, such liabilities arising because of, but not limited to, the following:
failure by the Company to settle within the policy limit, or by reason of alleged or actual
negligence, fraud or bad faith in rejecting an offer of settlement or in the preparation of
the defense or in the trial of any action against an insured of the Company or in the
preparation or prosecution of an appeal consequent upon such action.
	 
	C.	 	The date on which an Extra Contractual Obligation is incurred shall be deemed, in all
circumstances, to be the date of the original accident, casualty, disaster or Loss Occurrence.
	 
	D.	 	However, this Article shall not apply where the loss has been incurred due to the fraud of a
member of the Board of Directors or a corporate officer 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 or settlement of any claim covered hereunder.
	 
	E.	 	Recoveries from any form of insurance or reinsurance which protects the Company against Extra
Contractual Obligation claims will inure to the benefit of the Reinsurer and shall be deducted
to arrive at the amount of the Company’s Ultimate Net Loss.

4.

 

ARTICLE IX — EXCESS JUDGMENTS

	A.	 	In the event a third party claimant is awarded an amount in excess of the Company’s policy
limit, and, as a result of the Company’s alleged or actual tortious conduct in the handling of
the investigation, defense or settlement of the claim made against the Company’s insured, an
action is taken by the insured or assignee and a judgment rendered against the Company for an
amount in excess of the Company’s policy limit, only that portion of the award made to the
third party claimant which is in excess of the Company’s policy limit shall be added to the
amount of the Company’s policy limit. The sum thereof shall be considered one loss, subject
to the provision in Paragraph B. below, the reinsurance limit and other provisions, exclusions
and limitations set forth in this Agreement
	 
	B.	 	Recoveries from any form of insurance or reinsurance which protects the Company against
claims which are the subject matter of this clause will inure to the benefit of the Reinsurer
and shall be deducted to arrive at the amount of the Company’s Ultimate Net Loss.

ARTICLE X — DEFINITIONS OF OCCURRENCE

	A.	 	The term “Occurrence” as used herein shall mean the sum of all damages sustained by each
person in each accident or Occurrence or series of accidents or Occurrences arising out of one
event.
	 
	B.	 	Each case of an employee contracting an Occupational Disease or Cumulative Injury shall be
considered a separate and distinct Occurrence.
	 
	C.	 	For the purposes of this Agreement, Occupational Disease shall mean any bodily injury that
fulfills all of the following conditions;

	 	1.	 	It is not traceable to a specific compensable accident, or Occurrence limited in
time and place during the employee’s present or past employment;
	 
	 	2.	 	It has been caused or aggravated by exposure to a disease-producing agent or agents
present in the worker’s occupational environment; and
	 
	 	3.	 	It has resulted in a disability or death.

	D.	 	For purposes of this Agreement, Cumulative Injury shall mean an injury that fulfills all of
the following conditions:

	 	1.	 	It is not traceable to a specific compensable accident occurring during the
employee’s present or past employment;
	 
	 	2.	 	It has been caused or aggravated by a repetitive employment-related activity; and
	 
	 	3.	 	It has resulted in a disability or death.

	E.	 	As respects an occupational or other disease or cumulative injury under Workers
Compensation and Employers Liability policies for which the employer is liable:

	 	1.	 	Which arises from a specific sudden and accidental event limited to 24 hours
in duration at the same location and suffered by one or more employees of an employer
shall be

5.

 

	 	 	 	deemed to be an occurrence within the meaning of this Agreement and the date of
occurrence shall be deemed to be the date the sudden and accidental event commenced.
However, the closure of a plant site shall not in and of itself be construed as an
Occurrence.
	 
	 	2.	 	Which does not arise from a specific sudden and accidental event limited in time
and place, such occupational or other disease or cumulative injury shall be deemed to be
an occurrence within the meaning of this Agreement, and the date of occurrence shall be
deemed to be the date of the beginning of the disability for which compensation is
payable if the case is compensable under the Workers Compensation law; or the date that
disability due to said disease actually began if the case is not compensable under the
Workers Compensation law. Each case of an employee contracting such occupational or other
disease or cumulative injury for which the employer insured by the Company is held liable
shall be considered a separate occurrence regardless of the date of loss.

ARTICLE XI — ORIGINAL CONDITIONS

The liability of the Reinsurer shall follow that of the Company in every case and shall be subject
in all respects to all the general and specific stipulations, clauses, waivers, extensions,
modifications, interpretations and endorsements of any of the Company’s aforementioned evidences
of liability, subject to the limits, terms and conditions of this Agreement as set forth herein.

ARTICLE XII — EXCLUSIONS

The Reinsurance provided under this Agreement is subject to the exclusions set forth below and
shall not cover said excluded risks, hazards and coverages, unless individually submitted by the
Company to the Reinsurer for inclusion hereunder; and, if specially accepted by the Reinsurer,
such business shall then be covered under the terms of this Agreement, except as such terms shall
be modified by such acceptance.

THE REINSURANCE PROVIDED UNDER THIS AGREEMENT DOES NOT APPLY TO:

	A.	 	THE
FOLLOWING GENERAL EXCLUSIONS

	 	1.	 	Ex-Gratia Payments.
	 
	 	2.	 	All reinsurance written or assumed by the Company, except Intercompany Reinsurance.
	 
	 	3.	 	Financial Guarantees.
	 
	 	4.	 	Loss or damage occasioned by war, invasion, hostilities, acts of foreign enemies,
civil war, rebellion, insurrection, military or usurped power, martial law or
confiscation by order of any government or public authority, but not excluding loss or
damage which would be covered under a standard form of policy containing a standard War
Exclusion Clause.

6.

 

	 	5.	 	Business derived from any Pool, Association, including Joint Underwriting Association,
Syndicate, Exchange Plan, Fund or other facility directly as a member, subscriber or
participant, or indirectly by way of reinsurance or assessments; provided this exclusion
shall not apply to Workers Compensation assigned risks which may be currently or
subsequently covered hereunder.
	 
	 	6.	 	Liability of the Company arising from its participation or membership, whether
voluntary or involuntary, in any insolvency fund, including any guarantee funds,
association, pool, plan or other facility which provides for the assessment of, payment
by or assumption by the Company of a part or the whole of any claim, debt, charge, fee or
other obligations of an insurer, or its successors or assigns which has been declared
insolvent by any authority having jurisdiction.
	 
	 	7.	 	Nuclear Incident Exclusion Clauses which are attached and made part of this
Agreement:

	 	a.	 	Nuclear Incident Exclusion Clause — Liability — Reinsurance — U.S.A.
	 
	 	b.	 	Nuclear Incident Exclusion Clause — Liability — Reinsurance — Canada
	 
	 	c.	 	Nuclear Incident Exclusion Clause — Reinsurance — No. 4.

	 	8.	 	Aggregate Excess or Stop Loss Workers Compensation policies.
	 
	 	9.	 	Distribution, manufacturing, processing, treatment, encapsulation or remediation of
asbestos, dioxin and/or polychlorinated biphenyls.

	B.	 	THE FOLLOWING RISKS

	 	1.	 	Aircraft Flight Operations, except where employees or employers are leasing or
chartering aircraft with 12 seats or less. However, this exclusion does not apply to the
Florida Aviation Trade Association Program.
	 
	 	2.	 	Navigation and operation of all vessels.
	 
	 	3.	 	Construction and/or maintenance of coffer dams.
	 
	 	4.	 	Operation of drydocks.
	 
	 	5.	 	Risks involving the ownership, maintenance or use of aircraft, except where
employees or employers are leasing or chartering aircraft with 12 seats or less.
However, this exclusion does not apply to the Florida Aviation Trade Association Program.
	 
	 	6.	 	Professional sports teams.
	 
	 	7.	 	Jones Act (except where incidental to the regular operations of the risk.)
	 
	 	8.	 	United States Longshoremen’s and Harbor Workers’ Act (except where incidental to
the regular operations of the risk.)
	 
	 	9.	 	Subaqueous work.
	 
	 	10.	 	Subway construction.
	 
	 	11.	 	Tunneling operations.

7.

 

	 	12.	 	Wrecking or demolition of buildings, structures or vessels.
	 
	 	13.	 	All coal mining operations.
	 
	 	14.	 	All underground mining operations.
	 
	 	15.	 	Onshore or offshore gas and oil drilling operations.
	 
	 	16.	 	Manufacture, production, refining, storage, distribution or transportation of
natural or artificial fuel gas, butane, propane or liquefied petroleum gases or gasoline.
	 
	 	17.	 	Manufacture of fireworks, fuses, nitroglycerine, celluloid and pyroxylin.
	 
	 	18.	 	Manufacture of any explosive substance intended for use as an explosive.
	 
	 	 	 	NOTE: An explosive substance is defined as any substance manufactured for the express
purpose of exploding as differentiated from other commodities used industrially and
which are only fortuitously explosive, such as gasoline, fuel gases and dyestuffs.
	 
	 	19.	 	Manufacture of any product (other than Fireworks and Fuses) in which any explosive
substance (as defined above) is an ingredient.
	 
	 	20.	 	Loading of any such explosive substance (as defined above) into containers for use
as explosive objects, propellant charges or detonating devices and the incidental storage
thereof.
	 
	 	21.	 	Handling, transportation or storage (or any one or more of them) of fireworks,
fuses, nitroglycerine, explosives, ammunitions or ammonium nitrate.

ARTICLE XIII — INADVERTENT BINDING

	A.	 	In the event that the Company inadvertently issued or issues any policies falling within the
scope of one or more of the exclusions set forth in the preceding paragraphs of this Article,
such policies shall be covered hereunder, provided that the Company issues, or causes to be
issued, the required notice of cancellation within 60 days after a member of the executive or
managerial staff at the Company’s home office having underwriting authority in the class of
business involved becomes aware that they apply to excluded classes unless the Company is
prevented by statute or regulation from canceling said risk within such period, in which case
such risk shall be covered hereunder until the earliest date on which the Company may cancel.
	 
	B.	 	However, should State regulations or statutes not allow the cancellation of such policy, the
Reinsurer agrees to cover such policy at terms to be agreed.

ARTICLE XIV — WARRANTY

The Company warrants that the maximum Employer’s Liability policy limit ceded to this Agreement
shall be $2,000,000.

8.

 

ARTICLE XV — CLAIMS

	A.	 	The Company shall advise the Reinsurer promptly of all claims and any subsequent developments
pertaining thereto with a reserve greater than or equal to 50% of the Company’s retention
hereunder.
	 
	B.	 	In addition, the following categories of claims shall be reported to the Reinsurer
immediately, regardless of any questions of liability of the insured or coverage under the
policy:

	 	1.	 	Fatalities, other than Workers’ Compensation only.
	 
	 	2.	 	Paraplegics and Quadriplegics.
	 
	 	3.	 	Serious burns.
	 
	 	4.	 	Serious brain injuries.
	 
	 	5.	 	Amputation of any extremity.
	 
	 	6.	 	Severe lacerations or disfigurement involving serious cosmetic deformity.
	 
	 	7.	 	Extended hospital, wheelchair or walker confinement.
	 
	 	8.	 	Severe back injury involving multiple surgeries (including laminectomies/fusions.)
	 
	 	9.	 	Loss of sight or hearing.
	 
	 	10.	 	Any claim involving Extra Contractual Obligations or Excess Judgments.
	 
	 	11.	 	Any claim involving Occupational Disease arising from a specific sudden and
accidental event.

	C.	 	The Company has the obligation to investigate and, to the extent that may be required by the
Policies reinsured hereunder, defend any claim affecting this reinsurance and to pursue such
claim to final determination.
	 
	D.	 	It is understood that, when so requested, the Company will afford the Reinsurer an
opportunity to be associated with the Company at the expense of the Reinsurer in the defense
or control of any claim or suit or proceeding involving this reinsurance; and the Company and
Reinsurer shall cooperate in every respect in the defense of such suit or claim or proceeding.

ARTICLE XVI — SUBROGATION AND SALVAGE

	A.	 	The Reinsurer shall be subrogated, as respects any loss for which the Reinsurer shall
actually pay or become liable, but only to the extent of the amount of payment by or the
amount of liability to the Reinsurer, to all the rights of the Company against any person or
other entity who may be legally responsible for damages in said loss. The Company hereby
agrees to enforce such rights; but, in case the Company shall refuse or neglect to do so, the
Reinsurer is hereby authorized and empowered to bring any appropriate action in the name of
the Company or its policyholders, or otherwise to enforce such rights.

9.

 

	B.	 	Any recoveries, salvages or reimbursements applying to risks covered under this Agreement
shall always be used to reimburse the excess carriers (from the last to the first, beginning
with the carrier of the last excess), according to their participation, before being used in
any way to reimburse the Company for its primary loss.
	 
	C.	 	In the event there are any recoveries, salvages or reimbursements covered subsequent to a
loss settlement, it is agreed, that if the expenses incurred in obtaining salvage or other
recoveries are less than the amount recovered, such expenses shall be borne by each party in
the proportion that each party benefits from the recoveries. Otherwise, the amount recovered
shall first be applied to the reimbursement of the expense of recovery, and the remaining
expense shall be borne by the Company and the Reinsurer in proportion to the liability of each
party for the loss before such recovery has been obtained. Expenses hereunder shall exclude
all office expenses of the Company and all salaries and expenses of its officials and
employees.

ARTICLE XVII — RESERVES AND TAXES

	A.	 	The Reinsurer shall maintain legal reserves with respect to claims hereunder. The Company
shall furnish to the Reinsurer semiannually a list of outstanding claims in which the
Reinsurer is interested, showing the amount of loss reserves set up by the Company with
respect to both the gross amount and the Reinsurer’s share of each and every such claim.
	 
	B.	 	The Company will be liable for all taxes on premiums reported to the Reinsurer hereunder and
will reimburse the Reinsurer for such taxes where the Reinsurer is required to pay the same.

ARTICLE XVIII — ACCESS TO RECORDS

The Company shall place at the disposal of the Reinsurer and the Reinsurer shall have the right to
inspect, through its authorized representatives, at all reasonable times during the currency of
this Agreement and thereafter, the books, records and papers of the Company pertaining to the
reinsurance provided hereunder and all claims made in connection therewith.

ARTICLE XIX — INSOLVENCY

In the event of the insolvency of the Company and the appointment of a conservator, liquidator or
statutory successor, the reinsurance provided by this Agreement shall be payable by the Reinsurer
directly to the Company or its liquidator, receiver or statutory successor on the basis of the
liability of the Company under the contract or contracts reinsured. Subject to the right of offset
and the verification of coverage, the Reinsurer shall pay its share of the loss without diminution
because of the insolvency of the Company. The liquidator, receiver or statutory successor of the
Company shall give written notice of the pendency of each claim against the Company on a policy or
bond reinsured within a reasonable time after such claim is filed in the insolvency proceeding.
During the pendency of such claim, the Reinsurer may, at its own expense, investigate such claim
and interpose, in the proceeding where such claim is to be adjudicated, any defense or defenses
which it may deem available to the Company, its liquidator or receiver or statutory successor.
Subject to court approval, any expense thus incurred by the Reinsurer shall be chargeable against
the Company as part of the expense of liquidation to the extent of such proportionate share of the
benefit as shall accrue to the Company solely as a result of the defense undertaken by the

10.

 

Reinsurer. The reinsurance shall be payable as set forth above, except where this Agreement
specifically provides for the payment of reinsurance proceeds to another party in the event of the
insolvency of the Company.

ARTICLE XX — OFFSET

Each party hereto shall have, and may exercise at any time and from time to time, the right to
offset any balance or balances, whether on account of premiums or on account of losses or
otherwise, due from such party to the other (or, if more than one, any other) party hereto under
this Agreement or under any other reinsurance agreement heretofore or hereafter entered into by and
between them, and may offset the same against any balance or balances due or to become due to the
former from the latter under the same or any other reinsurance agreement between them; and the
party asserting the right of offset shall have and may exercise such right where the balance or
balances due or to become due to such party from the other are on account of premiums or on account
of losses or otherwise and regardless of the capacity, whether as assuming insurer or as ceding
insurer, in which each party acted under the agreement or, if more than one, the different
agreements involved, provided, in the event of the insolvency of a party hereto, offsets shall only
be allowed in accordance with the laws of the insolvent party’s state of domicile.

ARTICLE XXI — ARBITRATION

	A.	 	Any dispute, difference or other matter in question arising out of or relating to this
Agreement, including its formation and validity, shall be referred to an arbitration panel
consisting of two arbitrators, appointed by the parties, and an Umpire. Arbitration shall be
initiated by the delivery of a written notice of demand for arbitration by one party to the
other.
	 
	B.	 	Each party shall appoint an arbitrator and the two arbitrators so appointed shall then
appoint an Umpire before proceeding. The two arbitrators and the Umpire shall together
constitute the arbitration panel. If either party fails to appoint a qualified arbitrator
within 30 days after receipt of a request by the other party to do so, the other party may
appoint both arbitrators. Should the two arbitrators fail to agree on an Umpire in 30 days,
each arbitrator shall nominate three persons of whom the other shall reject two. The Umpire
shall then be chosen by drawing lots. The arbitrators and Umpire shall be impartial and shall
be present or former executives or officers of insurance or reinsurance companies who have no
financial or other interest in the outcome of the arbitration.
	 
	C.	 	The arbitration shall be held in Lakeland, Florida unless the parties mutually agree
otherwise. The laws of the state of Florida shall govern the arbitration proceeding without
regard to its choice of law rules. The arbitration panel is relieved from judicial formalities
and, in addition to considering the rules of law and the custom and practice of the insurance
and reinsurance business, shall make their award with a view to effecting the general purpose
of the Agreement.

11.

 

	D.	 	The arbitration panel shall have the power to set all procedural rules for the arbitration,
including the discretion to make any order with respect to pleadings, discovery, scheduling
the hearing, reception of evidence and any other matter whatsoever relating to the conduct of
the arbitration. Each party shall submit its case to the arbitration panel within 60 days of
the selection of the Umpire or such larger period as may be determined by the arbitration
panel. The written decision of a majority of the arbitration panel shall be final and binding
on the parties. Judgment upon the award may be entered in any court having jurisdiction.
	 
	E.	 	Each party shall pay the fees and expenses of its own arbitrator. The parties shall equally
divide the fees and expenses of the umpire and other expenses of the arbitration, unless such
fees and expenses are otherwise allocated by the arbitration panel.
	 
	F.	 	This Article shall remain in full force and effect in the event this Agreement or any
provision thereof shall be found invalid for any reason and/or in the event of insolvency.

ARTICLE XXII — CURRENCY

The currency to be used for all purposes of this Agreement shall be United States Dollars.

ARTICLE XXIII — 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 such provision in any other
jurisdiction.

ARTICLE XXIV — ERRORS AND OMISSIONS

Inadvertent delays, errors or omissions made in connection with this Contract or any transaction
hereunder shall not relieve either party from any liability which would have attached had such
delay, error or omission not occurred, provided always that such error or omission is rectified as
soon as possible after discovery.

12.

 

ARTICLE XXV — SERVICE OF SUIT

(This clause applies only to those Reinsurer not domiciled in the United States of America, and/or
not authorized in any state, territory and/or district of the United States where authorization is
required by insurance regulatory authorities.)

	A.	 	It is agreed that in the event of the failure of the Reinsurer to pay any amount claimed to
be due under this Agreement, the Reinsurer, at the request of the Company, shall submit to the
jurisdiction of any court of competent jurisdiction within the United States of America and
shall comply with all requirements necessary to give such court jurisdiction; and all matters
arising hereunder shall be determined in accordance with the law and practice of such court.
Nothing in this Clause constitutes or should be understood to constitute a waiver of
Reinsurer’s 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. Service of process in such suit may be made upon Messrs. Mendes and Mount, 750
Seventh Avenue, New York, New York 10019 (hereinafter, “agent for service of process”) and in
any suit instituted against any reinsurer upon this Reinsurer shall abide by the final
decision of such court or of any appellate court in the event of an appeal.
	 
	B.	 	The above named are authorized and directed to accept service of process on behalf of
Reinsurer in any such suit and/or upon the request of the Company to give a written
undertaking to the Company that the agent for service of process shall enter a general
appearance on behalf of Reinsurer behalf in the event such a suit shall be instituted.
	 
	C.	 	Further, pursuant to any statute of any state, territory or district of the United States of
America which makes provision therefor, the Reinsurer hereby designate the Superintendent,
Commissioner or Director of Insurance or other officer specified for that purpose in the
statute, or his successor or successors in office, as their true and lawful attorney upon whom
may be served any lawful process in any action, suit or proceeding instituted by or on behalf
of the Company or any beneficiary hereunder arising out of this Agreement and hereby designate
the agent for service of process as the firm to whom the said officer is authorized to mail
such process or a true copy thereof.
	 
	 	 	The foregoing is not intended to conflict with or override the obligation of the parties
hereto to arbitrate their disputes as provided in the Arbitration Clause.

ARTICLE XXVI — ENTIRE AGREEMENT

This Agreement constitutes the entire Agreement between the parties and any amendments hereto will
be in writing and signed by the parties.

ARTICLE XXVII — GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of
Florida.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly
authorized representatives as of the following dates:

13.

 

In Lakeland, Florida, this 22nd day of May, 2000.

	 	 	 	 	 

	ATTEST:

	 	BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY
	 	 
	 
	 	 	 	 
	/s/

	 	/s/
	 	 
	 

	 	 

	 	 

And in Keene, New Hampshire, this 12th day of May, 2000.

	 	 	 	 	 

	ATTEST:

	 	PEERLESS INSURANCE COMPANY
	 	 
	 
	 	 	 	 
	/s/ Nancy C. Callender

	 	/s/
	 	 
	 

	 	 

	 	 

IV:jd
BRIDG-TBD

14.

 

SUPPLEMENT TO THE ATTACHMENTS

DEFINITION OF IDENTIFICATION TERMS USED WITHIN THE ATTACHMENTS

	A.	 	Wherever the term “Company” or “Reinsured” or “Reassured” or whatever other term is used to
designate the reinsured Company or companies within the various attachments to the reinsurance
agreement, the term shall be understood to mean Company or Reinsured or Reassured or whatever
other term is used in the attached reinsurance agreement to designate the reinsured Company or
companies.

	B.	 	Wherever the term “Agreement” or “Contract” or “Policy” or whatever other term is used to
designate the attached reinsurance agreement within the various attachments to the reinsurance
agreement, the term shall be understood to mean Agreement or Contract or Policy or whatever
other term is used to designate the attached reinsurance agreement,

	C.	 	Wherever the term “Reinsurer” or “Reinsurers” or “Underwriters” or whatever other term is
used to designate the Reinsurer or Reinsurers in the various attachments to the reinsurance
agreement, the term shall be understood to mean Reinsurer or Reinsurers or Underwriters or
whatever other term is used to designate the reinsuring Company or companies.

 

 

	 	 	NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY — REINSURANCE — U.S.A.

	 	 	N.M.A. 1590

	1.	 	This reinsurance does not cover any loss or liability accruing to the Reassured as a member
of, or subscriber to, any association of insurers or Reinsurers formed for the purpose of
covering nuclear energy risks or as a direct or indirect Reinsurer of any such member,
subscriber or association.

	2.	 	Without in any way restricting the operation of paragraph 1. of this Clause it is understood
and agreed that for all purposes of this reinsurance all the original policies of the
Reassured (new, renewal and replacement) of the classes specified in Clause II. in this
paragraph 2. from the time specified in Clause III. in this paragraph 2. shall be deemed to
include the following provision (specified as the Limited Exclusion Provision):

	 	 	LIMITED EXCLUSION PROVISION*

	 	I.	 	It is agreed that the policy does not apply under any liability coverage, to
injury, sickness, disease, death or destruction, bodily injury or property damage
with respect to which an insured under the policy is also an insured under a nuclear
energy liability policy issued by Nuclear Energy Liability Insurance Association,
Mutual Atomic Energy Liability Underwriters or Nuclear Insurance Association of
Canada, or would be an insured under any such policy but for its termination upon
exhaustion of its limit of liability.
	 
	 	II.	 	Family Automobile Policies (liability only), Special Automobile Policies
(private passenger automobiles, liability only), Farmers Comprehensive Personal
Liabilities Policies (liability only), Comprehensive Personal Liability Policies
(liability only) or policies of a similar nature; and the liability portion of
combination forms related to the four classes of policies stated above, such as the
Comprehensive Dwelling Policy and the applicable types of Homeowners Policies.
	 
	 	III.	 	The inception dates and thereafter of all original policies as described
in II. above, whether new, renewal or replacement, being policies which either

N.M.A. 1590

-1-

 

	 	(a)	 	become effective on or after 1st May, 1960, or
	 
	 	(b)	 	become effective before that date and contain the Limited Exclusion Provision set
out above; provided this paragraph 2. shall not be applicable to Family
Automobile Policies, Special Automobile Policies, or policies or combination
policies of a similar nature, issued by the Reassured on New York risks, until
90 days following approval of the Limited Exclusion Provision by the
Governmental Authority having jurisdiction thereof.

	3.	 	Except for those classes of policies specified in Clause II. of paragraph 2. and without in
any way restricting the operation of paragraph 1. of this Clause, it is understood and agreed
that for all purposes of this reinsurance the original liability policies of the Reassured
(new, renewal and replacement) affording the following coverages:
	 
	 	 	Owners, Landlords and Tenants Liability, Contractual Liability, Elevator Liability, Owners or
Contractors (including railroad) Protective Liability, Manufacturers and Contractors
Liability, Product Liability, Professional and Malpractice Liability, Storekeepers Liability,
Garage Liability, Automobile Liability (including Massachusetts Motor Vehicle or Garage
Liability)
	 
	 	 	shall be deemed to include with respect to such coverages, from the time specified in Clause
V. of this paragraph 3., the following provision (specified as the Broad Exclusion
Provision):
	 
	 	 	BROAD EXCLUSION PROVISION*
	 
	 	 	It is agreed that the policy does not apply:

	 	I.	 	Under any Liability Coverage to injury, sickness, disease, death or
destruction, bodily injury or property damage

	 	(a)	 	with respect to which an insured under the policy is also an
insured under nuclear energy liability policy issued by Nuclear Energy
Liability Insurance Association, Mutual Atomic Energy Liability Underwriters
or Nuclear Insurance Association of Canada, or would be an insured under any
such policy but for its termination upon exhaustion of its limit of
liability; or

N.M.A. 1590

-2-

 

	 	(b)	 	resulting from the hazardous properties of nuclear material and with
respect to which (1) any person or organization is required to maintain
financial protection pursuant to the Atomic Energy Act of 1954, or any law
amendatory thereof, or (2) the insured is, or had this policy not been
issued would be, entitled to indemnity from the United States of America,
or any agency thereof, under any agreement entered into by the United
States of America, or any agency thereof, with any person or organization.

	 	II.	 	Under any Medical Payments Coverage, or under any Supplementary Payments
Provision relating to immediate medical or surgical relief, first aid, to expenses
incurred with respect to bodily injury, sickness, disease or death,
bodily injury resulting from the hazardous properties of nuclear material and
arising out of the operation of a nuclear facility by any person or organization.
	 
	 	III.	 	Under any Liability Coverage, to injury, sickness, disease, death or
destruction, bodily injury or property damage resulting from the hazardous
properties of nuclear material, if

	 	(a)	 	the nuclear material (1) is at any nuclear facility owned by,
or operated by or on behalf of, an insured or (2) has been discharged or
dispersed therefrom;
	 
	 	(b)	 	the nuclear material is contained in spent fuel or waste at
any time possessed, handled, used, processed, stored, transported or disposed
of by or on behalf of an insured; or
	 
	 	(c)	 	the injury, sickness, disease, death or destruction, bodily
injury or property damage arises out of the furnishing by an insured of
services, materials, parts or equipment in connection with the
planning, construction, maintenance, operation or use of any nuclear facility,
but if such facility is located within the United States of America, its
territories, or possessions or Canada, this exclusion (c) applies only to
injury to or destruction of property at such nuclear facility, property damage
to such nuclear facility and any property thereat.

N.M.A. 1590

-3-

 

	 	IV.	 	As used in this endorsement:

	 	“hazardous properties” include radioactive, toxic or explosive properties;
“nuclear material” means source material, special nuclear material or byproduct
material; “source material,” “special nuclear material,” and “byproduct material”
have the meanings given them in the Atomic Energy Act of 1954 or in any law
amendatory thereof; “spent fuel” means any fuel element or fuel component, solid
or liquid, which has been used or exposed to radiation in a nuclear reactor;
“waste” means any waste material (1) containing byproduct material other than the
tailings or wastes produced by the extraction or concentration of uranium or
thorium from any ore processed for its source material content and (2) resulting
from the operation by any person or organization of any nuclear facility included
within the definition of nuclear facility under paragraph (a) or (b) thereof;
“nuclear facility” means

	 	(a)	 	any nuclear reactor,
	 
	 	(b)	 	any equipment or device designed or used for (1) separating
the isotopes of uranium or plutonium, (2) processing or utilizing spent fuel,
or (3) handling, processing or packaging waste,
	 
	 	(c)	 	any equipment or device used for the processing, fabricating
or alloying of special nuclear material if at any time the total amount of
such material in the custody of the insured at the premises where such
equipment or device is located consists of or contains more than 25 grams of
plutonium or uranium 233 or any combination thereof, or more than 250 grams of
uranium 235,
	 
	 	(d)	 	any structure, basin, excavation, premises or place prepared
or used for the storage or disposal of waste
	 
	 	 	 	and includes the site on which any of the foregoing is located, all operations
conducted on such site and all premises used for such operations; “nuclear reactor”
means any apparatus designed or used to sustain nuclear fission in a
self-supporting chain reaction or to contain a critical mass of fissionable
material; with respect to injury to or destruction of property, the word
“injury” or “destruction” includes all forms of radioactive contamination of
property; “property damage” includes all forms of radioactive contamination of
property.

N.M.A. 1590

-4-

 

	 	V.	 	The inception dates and thereafter of all original policies affording coverages
specified in this paragraph 3., whether new, renewal or replacement, being policies
which become effective on or after 1st May, 1960, provided this paragraph 3. shall
not be applicable to

	 	(i)	 	Garage and Automobile Policies issued by the Reassured
on New York risks, or
	 
	 	(ii)	 	Statutory liability insurance required under Chapter
90, General Laws of Massachusetts,

	 	 	 	until 90 days following approval of the Broad Exclusion Provision by the
Governmental Authority having jurisdiction thereof.

	4.	 	Without in any way restricting the operations of paragraph 1. of this Clause, it is
understood and agreed that paragraphs 2. and 3. above are not applicable to original
liability policies of the Reassured in Canada, and that with respect to such policies, this
Clause shall be deemed to include the Nuclear Energy Liability Exclusion Provisions adopted
by the Canadian Underwriters’ Association or the Independent Insurance Conference of Canada.

	 		
	*NOTE:	 	 The words printed in BOLD TYPE in the Limited
Exclusion Provision and in the
Broad Exclusion Provision
shall apply only in relation
to original liability policies
which include a Limited
Exclusion Provision or a Broad
Exclusion Provision containing
those words.

N.M.A. 1590

-5-

 

	 	 	NUCLEAR INCIDENT EXCLUSION CLAUSE — LIABILITY — REINSURANCE — CANADA
	 
	 	 	N.M.A. 1979

	1.	 	This Agreement does not cover any loss or liability accruing to the Company as a member of,
or subscriber to, any association of insurers or Reinsurers formed for the purpose of covering
nuclear energy risks or as a direct or indirect Reinsurer of any such member, subscriber or
association.
	 
	2.	 	Without in any way restricting the operation of Paragraph 1. of this Clause, it is agreed
that for all purposes of this Agreement all the original liability contracts of the Company,
whether new, renewal or replacement, of the following classes, namely,

Personal Liability

Farmers’ Liability

Storekeepers’
Liability

	 	 	which become effective on or after 31st December 1984, shall be deemed to include, from their
inception dates and thereafter, the following provision:
	 
	 	 	Limited Exclusion Provision —
	 
	 	 	This Policy does not apply to bodily injury or property damage with respect to which the
Insured is also insured under a contract of nuclear energy liability insurance (whether the
Insured is unnamed in such contract and whether or not it is legally enforceable by the
Insured) issued by the Nuclear Insurance Association of Canada or any other group or pool of
insurers or would be an Insured under any such policy but for its termination upon exhaustion
of its limits of liability.
	 
	 	 	With respect to property, loss of use of such property shall be deemed to be property damage.
	 
	3.	 	Without in any way restricting the operation of Paragraph 1. of this Clause, it is agreed
that for all purposes of this Agreement all the original liability contracts of the Company,
whether new, renewal or replacement, of any class whatsoever (other than Personal Liability,
Farmers’ Liability, Storekeepers’ Liability or Automobile Liability contracts), which become
effective on or after 31st December 1984, shall be deemed to include, from their inception
dates and thereafter, the following provision:

N.M.A. 1979

-1-

 

	 	 	Broad Exclusion Provision —
	 
	 	 	It is agreed that this Policy does not apply:

	 	(a)	 	to liability imposed by or arising under the Nuclear Liability Act; nor
	 
	 	(b)	 	to bodily injury or property damage with respect to which an Insured under this
Policy is also insured under a contract of nuclear energy liability insurance (whether
the Insured is unnamed in such contract and whether or not it is legally enforceable by
the Insured) issued by the Nuclear Association of Canada or any other insurer or group or
pool of insurers or would be an Insured under any such policy but for its termination
upon exhaustion of its limit of liability; nor
	 
	 	(c)	 	to bodily injury or property damage resulting directly or indirectly from the
nuclear energy hazard arising from:

	 	(i)	 	the ownership, maintenance, operation or use of a nuclear facility by or
on behalf of an Insured;
	 
	 	(ii)	 	the furnishing of an Insured of services, materials, parts or equipment in
connection with the planning, construction, maintenance, operation or use
of any nuclear facility; and
	 
	 	(iii)	 	the possession, consumption, use, handling, disposal or transportation of
fissionable substances, or of other radioactive material (except
radioactive isotopes, away from a nuclear facility, which have reached the
final stage of fabrication so as to be usable for any scientific, medical,
agricultural, commercial or industrial purpose) used, distributed, handled
or sold by an Insured.

	 	 	As used in this Policy:

	 	(1)	 	The term “nuclear energy hazard” means the radioactive, toxic, explosive, or other
hazardous properties of radioactive material;
	 
	 	(2)	 	The term “radioactive material” means uranium, thorium, plutonium, neptunium, their
respective derivatives and compounds, radioactive isotopes of other elements and any
other substances that the Atomic Energy Control Board may, by regulation, designate as
being prescribed substances capable of releasing atomic energy, or as being requisite for
the production, use or application of atomic energy;

N.M.A. 1979

-2-

 

	 	(3)	 	The term “nuclear facility” means:

	 	(a)	 	any apparatus designed or used to sustain nuclear fission in a
self-supporting chain reaction or to contain a critical mass of plutonium, thorium
and uranium or any one or more of them;
	 
	 	(b)	 	any equipment or device designed or used for (i) separating the
isotopes of plutonium, thorium and uranium or any one or more of them, (ii)
processing or utilizing spent fuel, or (iii) handling, processing or packaging
waste;
	 
	 	(c)	 	any equipment or device used for the processing, fabricating or
alloying of plutonium, thorium or uranium enriched in the isotope uranium 233 or in
the isotope uranium 235, or any one or more of them if at any time the total amount
of such material in the custody of the Insured at the premises where such equipment
or device is located consists of or contains more than 25 grams of plutonium or
uranium 233 or any combination thereof, or more than 250 grams of uranium 235;
	 
	 	(d)	 	any structure, basin, excavation, premises or place prepared or used
for the storage or disposal of waste radioactive material;

	 	 	 	and includes the site on which any of the foregoing, is located, together with all
operations conducted thereon and all premises used for such operations.
	 
	 	(4)	 	The term “fissionable substance” means any prescribed substance that is, or from
which can be obtained, a substance capable of releasing atomic energy by nuclear fission.
	 
	 	(5)	 	With respect to properly, loss of use of such property shall be deemed to be
property damage.

N.M.A. 1979

-3-

 

NUCLEAR INCIDENT EXCLUSION CLAUSE — REINSURANCE — NO. 4

	1.	 	This Reinsurance does not cover any loss or liability accruing to the Reassured as a member
of, or subscriber to, any association of insurers or Reinsurers formed for the purpose of
covering nuclear energy risks or as a direct or indirect Reinsurer of any such member,
subscriber or association.
	 
	2.	 	Without in any way restricting the operations of Nuclear Incident Exclusion Clauses, —
Liability, — Physical Damage, — Boiler and Machinery and paragraph 1. of this Clause, it is
understood and agreed that for all purposes of the reinsurance assumed by the Reinsurer from
the Reinsured, all original insurance policies or contracts of the Reinsured (new, renewal and
replacement) shall be deemed to include the applicable existing Nuclear Clause and/or Nuclear
Exclusion Clause(s) in effect at the time and any subsequent revisions thereto as agreed upon
and approved by the Insurance Industry and/or a qualified Advisory or Rating Bureau.

 

 

ADDENDUM NO. 1

to the

WORKERS’ COMPENSATION EXCESS OF LOSS

REINSURANCE AGREEMENT

Effective January 1, 2000

(hereinafter referred to as the “Agreement”)

Between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(hereinafter referred to as the “Reinsurer”)

It is hereby understood and agreed that effective January 1, 2001, 12:01 AM Local
Standard Time this Agreement is amended as follows:

	1.	 	Article IV — Limits of Cover

	 	 	 	This article is deleted in its entirety and replaced with the
following:
	 
	 	 	 	Part I — First Casualty Excess of Loss
	 
	 	 	 	For all states other than Florida the Company shall retain the first $250,000
of Ultimate Net Loss as respects any one Loss Occurrence. The Reinsurer shall
then be liable for the amount by which the Company’s Ultimate Net Loss exceeds
the Company’s retention of $250,000, but the liability of the Reinsurer shall
never exceed $250,000 with respect to any one Loss Occurrence.
	 
	 	 	 	Part II — Casualty Second Excess of Loss
	 
	 	 	 	The Company shall retain the first $500,000 of Ultimate Net Loss as respects
any one Loss Occurrence. The Reinsurer shall then be liable for the amount by
which the Company’s Ultimate Net Loss exceeds the Company’s retention of
$500,000, but the liability of the Reinsurer shall never exceed $500,000 with
respect to any one Loss Occurrence.
	 
	 	 	 	Part III — Casualty Third Excess of Loss
	 
	 	 	 	The Company shall retain the first $1,000,000 of Ultimate Net Loss as respects
any one Loss Occurrence. The Reinsurer shall then be liable for the amount by
which the Company’s Ultimate Net Loss exceeds the Company’s retention of
$1,000,000, but the liability of the Reinsurer shall never exceed $4,000,000
with respect to any one Loss Occurrence.

Add#1 WC XOL Bridgefield

CAS00SHI02

1

 

	 	 	 	Part IV — Casualty Fourth Excess of Loss
	 
	 	 	 	The Company shall retain the first $5,000,000 of Ultimate Net Loss as respects any one Loss Occurrence.
The Reinsurer shall then be liable for the amount by which the Company’s Ultimate Net Loss exceeds the Company’s retention
of $5,000,000, but the liability of the Reinsurer shall never exceed $5,000,000 with respect to any one Loss Occurrence.
	 
	 	 	 	Part V — Casualty Fifth Excess of Loss
	 
	 	 	 	The Company shall retain the first $10,000,000 of Ultimate Net Loss as respects any one Loss Occurrence, as per Exhibit A.

	2.	 	Article V — Reinsurance Premium

	 	 	 	Paragraph A of this article is deleted in its entirety and replaced with the following:
	 
	 	 	 	The Company shall pay to the Reinsurer a premium for the reinsurance provided under Parts I, II, III, IV, and
V of Article IV at the rates set forth below. Such rates shall be applied to the Company’s Subject
Earned Premium for the monthly period being reported.

	 	 	 	 	 
	 	 	Rate
	 
	 	 	 	 
	First Excess of Loss
	 	 	4.78	%
	Second Excess of Loss
	 	 	2.28	%
	Third Excess of Loss
	 	 	2.27	%
	Fourth Excess of Loss
	 	 	.24	%
	Fifth Excess of Loss
	 	Exhibit A

	 	 	 	There are no changes to paragraphs B & C.

	3.	 	Article XXVIII — Reinstatement

	 	 	 	This article is added as follows:
	 
	 	 	 	Paragraph A — For Parts I, II, III and IV of Article IV, it is understood that each claim hereunder reduces
the amount of indemnity from the time of occurrence of the loss by the sum paid, but any amount so exhausted
is hereby reinstated from the time the Loss Occurrence commences without payment of additional premium.
	 
	 	 	 	Paragraph B — For Part V of Article IV, reinstatement provisions are covered in Exhibit A.

	4.	 	All other provisions remain the same.

Add #1 WC XOL Bridgefield

2

 

IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be executed by their duly
authorized representatives.

In Lakeland, Florida, this 12 day of August, 2001.

	 	 	 	 	 

	ATTEST

	 	BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY
	 	 
	 
	 	 	 	 
	/s/

	 	/s/	 	 
	 

	 	 

	 	 

And in Keene, New Hampshire, this 3rd day of August, 2001.

	 	 	 	 	 

	ATTEST

	 	PEERLESS INSURANCE COMPANY
	 	 
	 
	 	 	 	 
	/s/ Nancy C. Callender

	 	/s/	 	 
	 

	 	 

	 	 

Add #1 WC XOL Bridgefield

3

 

Exhibit A

Definition of Company:

For
purposes of Article I or any Articles, wherever the word “Company” is used, including Addendum No. 1 and this Exhibit A, the Company is defined to include the following Profit Centers:

	 	 	 

	Peerless Insurance:

	 	Peerless Insurance Company, The Netherlands Insurance Company, Excelsior Insurance Company, America First Insurance
Company, Atlas Assurance Company of America, Indiana Insurance Company in certain territories
	 
	 	 
	Indiana Insurance:

	 	Indiana Insurance Company, Consolidated Insurance Company, The Midwestern Indemnity Company, Mid-American Fire and Casualty
Company, Tower Insurance Company, Inc., Peerless Insurance Company and The Netherlands Insurance Company in certain
territories
	 
	 	 
	Colorado Casualty:

	 	Colorado Casualty Insurance Company
	 
	 	 
	Montgomery Insurance Cos.:

	 	Montgomery Mutual Insurance Company, Montgomery Indemnity Company, Colorado Casualty Insurance Company, Peerless Insurance
Company, The Netherlands Insurance Company and Excelsior Insurance Company in certain territories
	 
	 	 
	Merchants and Business Men’s:

	 	Merchants and Business Men’s Mutual Insurance Company
	 
	 	 
	LMIC Small Business Group:

	 	Liberty Mutual Insurance Company, Liberty Mutual Fire Insurance Company, LM Insurance Corporation, Liberty Insurance

Corporation, The First Liberty Insurance Corporation
	 
	 	 
	Golden Eagle Insurance:

	 	Golden Eagle Insurance Corporation, Peerless Insurance Company and The Netherlands Insurance Company in certain territories.
	 
	 	 
	Summit:

	 	Bridgefield Casualty Insurance Company, Bridgefield Employers Insurance Company, Liberty Mutual Insurance Company and
Liberty Mutual Fire Insurance Company in certain territories

Limit and Retention:

As respects Article IV, Part V, the Company shall retain the first $10,000,000 of
Ultimate Net Loss as respects any one Loss Occurrence. The Reinsurer shall then be liable for
the amount by which the Company’s Ultimate Net Loss exceeds the Company retention of $10,000,000,
provided, however, that the liability of the Reinsurer shall never exceed $15,000,000 with respect to any one Loss Occurrence.

Reinstatement:

	A.	 	As respects Article XXVIII, Part V, each claim hereunder shall reduce
the amount of the Reinsurer’s liability from the time of the occurrence of the loss by the sum
paid, but the sum so exhausted shall be reinstated immediately from the time of the occurrence of the loss.
	 
	B.	 	As respects Article XXVIII, Part V, for the second and any subsequent reinstatement the

Add #1 WC XOL Bridgefield

4

 

	 	 	Company agrees to pay an additional premium calculated by multiplying the below percentages of the
annual total reinsurance premium thereon by the percentage that the amount reinstated bears to the limit of the agreement.
The first reinstatement is free.

	 	 	 	 	 

	Second
	 	 	50	%
	Third and subsequent
	 	 	100	%

	C.	 	As respects Article XXVIII, Part V, if one or more Profit Center contributes to one or more losses, reinstatement premium
will be allocated to the Profit Center based on its contribution to the total loss.

Premium:

	A.	 	As respects Article V, Part V, the Company shall pay to the Reinsurer a premium for the reinsurance provided under Article IV
at the rates set forth in Paragraph B. Such rates shall be applied to the Company’s subject earned premium for the reporting period.
	 
	B.	 	Each profit center shall apply the following percentages to the subject earned premium:

	 	 	 	 	 	 	 
	Profit Center/Company	 	Territories	 	Rate	 
	 
	 	 	 	 	 	 
	LMIC Small Business Group
	 	All states	 	 	.467	%
	 
	 	 	 	 	 	 
	Merchants and Business Men’s
	 	All states	 	 	.724	%
	 
	 	 	 	 	 	 
	Montgomery Insurance Cos.
	 	All states	 	 	.130	%
	Colorado Casualty Ins. Co.
	 	AL, GA, LA, NC, VA	 	 	 	 
	Peerless Insurance Company
	 	GA, DC, DE, MD, NC, SC, VA	 	 	 	 
	The Netherlands Ins. Co.
	 	GA, MD, NC, SC, VA	 	 	 	 
	Excelsior Insurance Company
	 	MD, DC, Va	 	 	 	 
	 
	 	 	 	 	 	 
	Colorado Casualty
	 	All states excl AL, GA, LA, NC, VA	 	 	.257	%
	 
	 	 	 	 	 	 
	Golden Eagle Insurance
	 	CA,AZ	 	 	.268	%
	 
	 	 	 	 	 	 
	Summit
	 	FL, AL, GA, KY, LA, MS 

SC, TN	 	 	.152	%
	Liberty Mutual Ins. Co.
	 	All excl FL, AL, GA, KY 

LA, MS, SC, TN	 	 	 	 
	Liberty Mutual Fire Ins. Co.
	 	All excl FL, AL, GA, KY 

LA, MS, SC, TN	 	 	 	 
	 
	 	 	 	 	 	 
	Indiana Insurance
	 	All states excl NJ	 	 	.100	%
	Peerless Insurance Company
	 	IL, IN, IA, KY, MI, MN 

OH, TN, WI	 	 	 	 
	 
	 	 	 	 	 	 
	The Netherlands Ins. Co
	 	IL, IN, IA, KY, MI, MN 

OH, TN, WI	 	 	 	 
	 
	 	 	 	 	 	 
	Peerless Insurance
	 	All states excl AZ, CA, DE, 

DC, GA, IL, IN, IA, KY, MD 

MI, MN, NC, OH, SC, TN 

VA, WI	 	 	.100	%
	Indiana Insurance Company
	 	NJ only	 	 	 	 

Add #1 WC XOL Bridgefield

5

 

ENDORSEMENT NO. 2

to the

INTERESTS AND LIABILITIES CONTRACT

(hereinafter referred to as the “Contract”)

of the

WORKERS’ COMPENSATION EXCESS OF LOSS

REINSURANCE AGREEMENT

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(hereinafter referred to as the “Reinsurer”)

It is understood and agreed that Addendum No. 2 to the Workers’ Compensation Excess of Loss
Reinsurance Agreement is attached hereto and made a part of said Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Endorsement to be executed in
duplicate, by their duly authorized representatives.

In Lakeland, Florida, this 13th day of November, 2007.

	 	 	 	 	 

	ATTEST:

	 	BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY	 	 
	 
	 	 	 	 
	/s/

	 	/s/ 	 	 
	 

	 	 

	 	 

And in Keene, New Hampshire, this 29th day of October, 2007.

	 	 	 	 	 

	ATTEST:

	 	PEERLESS INSURANCE COMPANY
	 	 
	 
	 	 	 	 
	/s/

	 	/s/ Nancy C. Callender	 	 
	 

	 	 

	 	 

CAS00SHI03

Endorsement No. 2

 

ADDENDUM NO. 2

to the

WORKERS’ COMPENSATION EXCESS OF LOSS

REINSURANCE AGREEMENT

(hereinafter referred to as the “Agreement”)

between

BRIDGEFIELD CASUALTY INSURANCE COMPANY

BRIDGEFIELD EMPLOYERS INSURANCE COMPANY

Lakeland, Florida

(hereinafter referred to as the “Company”)

and

PEERLESS INSURANCE COMPANY

Keene, New Hampshire

(hereinafter referred to as the “Reinsurer”)

It is understood and agreed that effective 12:01 a.m., January 1, 2002, this Agreement is
terminated in accordance with the provisions of Article I, Paragraph C.2. — Commencement and
Termination.

Addendum No. 2

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