Document:

INTEREST AND LIABILITIES AGREEMENT

 Exhibit 10.22 
 INTERESTS AND LIABILITIES AGREEMENT 
 (the “Agreement”) 

of 
 HANNOVER
REINSURANCE (IRELAND) LIMITED 
 (the “Subscribing Reinsurer”) 

with respect to the 
 SECOND CASUALTY EXCESS OF LOSS 
 REINSURANCE CONTRACT 

(the “Contract”) 
 issued to 
 AMERICAN INTERSTATE INSURANCE COMPANY 

DeRidder, Louisiana 
 and 
 AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 

Austin, Texas 
 and 
 SILVER OAK CASUALTY, INC. 

DeRidder, Louisiana 
 and 
 any other insurance companies which are now or hereafter come under
the ownership, 
 control or management of Amerisafe Insurance Group 

(collectively the “Company”) 
 The Subscribing Reinsurer shall have a 75.00% share in the interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 

This Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time,
January 1, 2015. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several
and not joint with the share of any other subscribing reinsurer. In no event shall the Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 16th day of December, 2011. 
  

							
	HANNOVER REINSURANCE (IRELAND) LIMITED	 		 	
				
	By	 	/s/ Michael Bennett	 		 	/s/ Donna Gallagher
	Print Name	 	Michael Bennett	 		 	Donna Gallagher
	Title	 	Head of Underwriting	 		 	Underwriter

  
 

 

  

					
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 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 TOKIO MILLENNIUM RE LTD. 

(the “Subscribing Reinsurer”) 
 with respect to the 
 SECOND CASUALTY EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 25.00% share in
the interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2015. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 30th day of December, 2011. 
  

							
	TOKIO MILLENNIUM RE LTD.	 		 	

	  
 By
	 	  
 /s/ Mirek
Wieczorek
	 		 
	Print Name	 	Mirek Wieczorek	 		 
	Title	 	Senior Vice President	 		 

  

					
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 AMERICAN INTERSTATE INSURANCE COMPANY 

DeRidder, Louisiana 
 and 
 AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 

Austin, Texas 
 and 
 SILVER OAK CASUALTY, INC. 

DeRidder, Louisiana 
 and 
 any other insurance companies which are now or hereafter come under
the ownership, 
 control or management of Amerisafe Insurance Group 

SECOND CASUALTY EXCESS OF LOSS 
 REINSURANCE CONTRACT 

  

					
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 TABLE OF CONTENTS 

 

							
	 ARTICLE
	 	 	  	PAGE	 
	 I
	 	 BUSINESS COVERED
	  	 	1	  
			
	 II
	 	 TERM
	  	 	2	  
			
	 III
	 	 SPECIAL TERMINATION
	  	 	2	  
			
	 IV
	 	 DEFINITIONS
	  	 	5	  
			
		 	 Act of Terrorism
	  	 	5	  
			
		 	 Declaratory Judgment Expense
	  	 	5	  
			
		 	 Extra Contractual Obligations/Loss in Excess of Policy Limits
	  	 	5	  
			
		 	 Loss Adjustment Expense
	  	 	6	  
			
		 	 Loss Occurrence
	  	 	6	  
			
		 	 Net Earned Premium
	  	 	7	  
			
		 	 Written Premium
	  	 	7	  
			
		 	 Policy
	  	 	7	  
			
		 	 Contract Year
	  	 	7	  
			
		 	 Policy Year Manual Payroll (excluding clerical)
	  	 	8	  
			
		 	 Ultimate Net Loss
	  	 	8	  
			
	 V
	 	 TERRITORY
	  	 	8	  
			
	 VI
	 	 EXCLUSIONS
	  	 	8	  
			
	 VII
	 	 TERRORISM RISK INSURANCE PROGRAM REAUTHORIZATION ACT
	  	 	11	  
			
	 VIII
	 	 COVERAGE
	  	 	12	  
			
	 IX
	 	 MATERIAL CHANGE
	  	 	12	  
			
	 X
	 	 REINSURANCE PREMIUM
	  	 	15	  
			
	 XI
	 	 FUNDS WITHHELD ACCOUNT
	  	 	15	  
			
	 XII
	 	 NOTICE OF LOSS AND LOSS SETTLEMENTS
	  	 	17	  
			
	 XIII
	 	 LIABILITY OF REINSURERS
	  	 	17	  
			
	 XIV
	 	 LATE PAYMENTS
	  	 	18	  
			
	 XV
	 	 REPORTS AND REMITTANCES
	  	 	19	  
			
	 XVI
	 	 COMMUTATION
	  	 	20	  
			
	 XVII
	 	 NOTIONAL EXPERIENCE ACCOUNT
	  	 	21	  
			
	 XVIII
	 	 ANNUITIES AT THE COMPANY’S OPTION
	  	 	22	  
			
	 XIX
	 	 SUNSET
	  	 	22	  
			
	 XX
	 	 SUBROGATION
	  	 	23	  
			
	 XXI
	 	 ERRORS AND OMISSIONS
	  	 	23	  

  

					
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	 XXII
	 	 OFFSET
	  	 	23	  
			
	 XXIII
	 	 CURRENCY
	  	 	23	  
			
	 XXIV
	 	 TAXES
	  	 	24	  
			
	 XXV
	 	 FEDERAL EXCISE TAX
	  	 	24	  
			
	 XXVI
	 	 NET RETAINED LINES
	  	 	24	  
			
	 XXVII
	 	 THIRD PARTY RIGHTS
	  	 	25	  
			
	 XXVIII
	 	 SEVERABILITY
	  	 	25	  
			
	 XXIX
	 	 GOVERNING LAW
	  	 	25	  
			
	 XXX
	 	 INSPECTION OF RECORDS
	  	 	25	  
			
	 XXXI
	 	 CONFIDENTIALITY
	  	 	26	  
			
	 XXXII
	 	 INSOLVENCY
	  	 	27	  
			
	 XXXIII
	 	 ARBITRATION
	  	 	27	  
			
	 XXXIV
	 	 UNAUTHORIZED REINSURANCE
	  	 	29	  
			
	 XXXV
	 	 SERVICE OF SUIT
	  	 	32	  
			
	 XXXVI
	 	 MODE OF EXECUTION
	  	 	33	  
			
	 XXXVII
	 	 ENTIRE AGREEMENT
	  	 	34	  
			
	 XXXVIII
	 	 INTERMEDIARY
	  	 	34	  
			
		 	 Nuclear Incident Exclusion Clause - Liability - Reinsurance - U.S.A.
	  			

  

					
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 SECOND CASUALTY EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 between 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 and 

THE SUBSCRIBING REINSURER(S) EXECUTING THE 
 INTERESTS AND LIABILITIES AGREEMENT(S) 
 ATTACHED HERETO 

(the “Reinsurer”) 
 ARTICLE I 
 BUSINESS COVERED 

By this Contract the Reinsurer agrees to reinsure the excess liability of the Company under its Policies that are in force at the effective time and date
hereof or issued or renewed at or after that time and date, and classified by the Company as Workers’ Compensation, Employers Liability, including but not limited to coverage provided under the U.S. Longshore and Harbor Workers’
Compensation Act, Jones Act, Outer Continental Shelf Lands Act and any other Federal Coverage extensions and General Liability business, subject to the terms, conditions and limitations hereafter set forth. 

  

					
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 ARTICLE II 
 TERM 
  

	A.	This Contract shall apply to all losses occurring during the period 12:01 a.m., Standard Time, January 1, 2012 (as set forth in the Company’s policies) to
12:01 a.m., Standard Time, January 1, 2015. 

  

	B.	Upon the expiration or termination of this Contract, the entire liability of the Reinsurer for losses occurring subsequent to the date of expiration or termination
shall cease concurrently with the date of expiration or termination of this Contract. 

  

	C.	If this Contract expires or is terminated while a Loss Occurrence covered hereunder is in progress, the Reinsurer’s liability hereunder shall, subject to the other
terms and conditions of this Contract, be determined as if the entire Loss Occurrence had occurred prior to the expiration of this Contract, provided that no part of such Loss Occurrence is claimed against any renewal or replacement of this
Contract. 

  

	D.	The Reinsurer shall have no right to either terminate or commute this Contract other than as set forth in paragraph F of the MATERIAL CHANGE ARTICLE or paragraph A of
the COMMUTATION ARTICLE or paragraph B of the SPECIAL TERMINATION ARTICLE. 

  

	E.	This Contract shall continue in force and shall apply, subject to all of the terms and limits hereof, to the Company’s Ultimate Net Loss until this Contract has
been commuted in accordance with the terms of the COMMUTATION ARTICLE or until all Ultimate Net Loss has been paid by the Reinsurer in accordance with the terms of the COVERAGE ARTICLE. 

ARTICLE III 

SPECIAL TERMINATION 
  

	A.	The Company may terminate a subscribing reinsurer’s share in this Contract by giving 90 days written notice to the subscribing reinsurer upon the happening of any
one of the following circumstances: 

  

	 	1.	A State Insurance Department or other legal authority orders the subscribing reinsurer to cease writing business, or 

 

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

  

					
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	 	3.	For any period not exceeding 12 months which commences no earlier than 12 months prior to the inception of this Contract, the subscribing reinsurer’s
policyholders’ surplus, as reported in the financial statements of the subscribing reinsurer (as respects a subscribing reinsurer domiciled outside the United States, policyholders’ surplus shall mean the sum of share capital and
contributed capital as stated in the subscribing reinsurer’s audited financial statement) has been reduced by 20.0% or more, or 

  

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

  

	 	5.	The subscribing reinsurer has reinsured its entire liability under this Contract without the Company’s prior written consent, or 

 

	 	6.	The subscribing reinsurer receives an A. M. Best rating of lower than A-, or an S&P financial strength rating of lower than A-, or 

 

	 	7.	The subscribing reinsurer has ceased writing new and renewal reinsurance for the lines of business covered hereunder, or 

 

	 	8.	The Company’s outside auditors determine during the first two months of the Term of the Contract that the Contract does not provide sufficient risk transfer to
constitute reinsurance in accordance with the Financial Accounting Standards Board Statements guidelines. 

  

	B.	A subscribing reinsurer may terminate their share of this Contract by giving 90 days written notice to the Company upon the happening of any one of the following
circumstances: 

  

	 	1.	A State Insurance Department or other legal authority orders the Company to cease writing business, or 

 

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

 

	 	3.	The Company has become merged with, acquired or controlled by any company, corporation, or individual(s) not controlling the Company’s operations previously.

  

	C.	In the event of termination in accordance with paragraph A or B, above, or in accordance with paragraph F of the MATERIAL CHANGE ARTICLE, the following shall apply as
respects reinsurance premium and reinsurance limits: 

  

	 	1.	If terminated prior to or at the expiration of Contract Year 1, the reinsurance premium, including any minimum reinsurance premium, shall be prorated as of the
termination date for Contract Year 1. The Reinsurer’s limit of liability in respect of all losses occurring during the term of this Contract shall be equal to the limits available any one Contract Year under the COVERAGE ARTICLE being
$10,000,000 prorated as of the termination date. 

  

					
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	 	2.	If terminated at any time during Contract Year 2 or Contract Year 3, the reinsurance premium shall be calculated as specified in the REINSURANCE PREMIUM ARTICLE for any
full Contract Year prior to the termination date. For the Contract Year in which termination occurs, the reinsurance premium, including any minimum reinsurance premium, shall be prorated as of the termination date. The Reinsurer’s limit of
liability in respect of losses occurring during the Contract Year in which the termination occurs shall be equal to the limits available any one Contract Year under the COVERAGE ARTICLE, being $10,000,000 prorated as of the termination date for that
Contract Year. The Reinsurer’s limit of liability in respect of all losses occurring during the term of this Contract shall be equal to the limits available during the term of this Contract under the COVERAGE ARTICLE being $20,000,000 prorated
as of the termination date and subject to a minimum of $10,000,000. 

  

	D.	In the event the Company terminates a subscribing reinsurer’s share in this Contract under the provision of this Article, the Company has the option, but not
obligation, to commute the subscribing reinsurer’s past liabilities for losses in accordance with the COMMUTATION ARTICLE. 

  

	E.	In the event the Company terminates a subscribing reinsurer’s share in this Contract under the provision of this Article, the Company shall have the option to
require the subscribing reinsurer to fund its share of 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, reserves for losses incurred but not reported as per the Company’s statutory accounts, unearned premium and any positive Notional Experience Account balance accrued by the Company, as
shown in the statement prepared by the Company, and any other balances or financial obligations. Within 30 days of the Company’s written request to fund, the subscribing reinsurer shall provide to the Company a clean, unconditional, evergreen,
irrevocable letter of credit or a trust agreement which establishes a trust account for the benefit of the Company. The method of funding must be acceptable to the Company, shall be established with a financial institution suitable to the Company,
shall comply with any applicable state or federal laws or regulations involving the Company’s ability to recognize these agreements as assets or offsets to liabilities in such jurisdictions and shall be at the sole expense of the subscribing
reinsurer. The Company and the subscribing reinsurer may mutually agree on alternative methods of funding or the use of a combination of methods. This option is available to the Company at any time there remains any outstanding liabilities of the
subscribing reinsurer. Notwithstanding the foregoing, the Company shall not require funding in accordance with this subparagraph in the event the subscribing reinsurer has otherwise fully funded its obligations under this Contract in a manner
acceptable to the Company. 

  

					
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 ARTICLE IV 
 DEFINITIONS 
  

	A.	Act of Terrorism 

 “Act of
Terrorism” as used herein shall follow the definition provided under the Terrorism Risk Insurance Act of 2002 (TRIA) and as amended by the Terrorism Risk Insurance Extension Act of 2005 (TRIEA) and the Terrorism Risk Insurance Program
Reauthorization Act of 2007 (TRIPRA), together and including any extensions or replacement thereof, the “Terrorism Act.” 
  

	B.	Declaratory Judgment Expense 

“Declaratory Judgment Expense” as used herein shall mean all expenses incurred by the Company in connection with a declaratory
judgment action brought to determine the Company’s defense and/or indemnification obligations that are allocable to a specific claim subject to this Contract. Declaratory Judgment Expense shall be deemed to have been incurred on the date of the
original loss (if any) giving rise to the declaratory judgment action. 
  

	C.	Extra Contractual Obligations/Loss in Excess of Policy Limits 

  

	 	1.	Extra Contractual Obligations 

This Contract shall protect the Company for any “Extra Contractual Obligations” which as used herein shall mean any punitive,
exemplary, compensatory or consequential damages, other than Loss in Excess of Policy Limits, paid or payable by the Company as a result of an action against it by its insured, its insured’s assignee or a third party claimant, by reason of
alleged or actual negligence, fraud or bad faith on the part of the Company in handling a claim under a Policy subject to this Contract. 
 An Extra Contractual Obligation shall be deemed to have occurred on the same date as the loss covered or alleged to be covered under the Policy. 

 

	 	2.	Loss in Excess of Policy Limits 

This Contract shall protect the Company for any “Loss in Excess of Policy Limits” which as used herein shall mean an amount that
the Company would have been contractually liable to pay had it not been for the limit of the original Policy as a result of an action against it by its insured, its insured’s assignee or a third party claimant. Such loss in excess of the limit
shall have been incurred because of 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 its insured or in the preparation or prosecution of an appeal consequent upon such action. 

  

					
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	 	3.	Notwithstanding anything stated herein, this paragraph C shall not apply where an Extra Contractual Obligation and/or Loss in Excess of Policy Limits has been incurred
due to an admission by the Company of fraud and/or criminal act committed by a member of the Board of Directors or a corporate officer or any employee of the Company acting individually or collectively or in collusion with a member of the Board of
Directors or a corporate officer or a partner of any other corporation or partnership. 

  

	D.	Loss Adjustment Expense 

“Loss Adjustment Expense” as used herein shall mean all costs and expenses allocable to a specific claim that are incurred by
the Company in the investigation, appraisal, adjustment, settlement, litigation, defense or appeal of a specific claim, including court costs and costs of supersedeas and appeal bonds, and including 1) pre-judgment interest, unless included as part
of the award or judgment; 2) post-judgment interest; 3) legal expenses and costs incurred in connection with coverage questions and legal actions connected thereto, including Declaratory Judgment Expense; and 4) a pro rata share of salaries and
expenses of Company field employees, and expenses of other Company employees who have been temporarily diverted from their normal and customary duties and assigned to the field adjustment of losses covered by this Contract. Loss Adjustment Expense
does not include unallocated loss adjustment expense. Unallocated loss adjustment expense includes, but is not limited to, salaries and expenses of employees, other than (4) above, and office and other overhead expenses. 

 

	E.	Loss Occurrence 

 “Loss
Occurrence” as used herein shall mean any one disaster or casualty or accident or loss or series of disasters or casualties or accidents or losses arising out of or caused by one event. Within the context of this definition and except for
Occupational Disease and Cumulative Trauma, the Company shall be the sole judge of what constitutes one event. 
  

	 	1.	As respects losses resulting from Occupational or Industrial Disease or Cumulative Trauma, each employee shall be considered a separate Loss Occurrence subject to the
following: 

 Losses resulting from Occupational or Industrial Disease or Cumulative Trauma suffered by employees
of an insured for which the employer is liable, as a result of a sudden and accidental event not exceeding 72 hours in duration, shall be considered one Loss Occurrence and may be combined with losses classified as other than Occupational or
Industrial Disease or Cumulative Trauma which arise out of the same event and the combination of such losses shall be considered as one Loss Occurrence within the meaning hereof. 

“Occupational or Industrial disease” is any abnormal condition that fulfills all of the following conditions: 

 

	 	a.	It is not traceable to a definite compensable accident occurring during the employee’s past or present employment. 

  

					
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	 	b.	It has been caused by exposure to a disease producing agent or agents present in the workers’ occupational environment. 

 

	 	c.	It has resulted in death or disability. 

 “Cumulative Trauma” is an injury that fulfils all of the following conditions: 
  

	 	a.	It is not traceable to a definite compensable accident occurring during the employees past or present employment and shall be as defined by applicable statutes or
regulations. 

  

	 	b.	It has occurred from and has been aggravated by a repetitive employment related activity. 

 

	 	c.	It has resulted in death or disability. 

  

	 	2.	As respects General Liability policies where the Company’s limit of liability for Products and Completed Operations coverages is determined on the basis of the
insured’s aggregate losses during a policy period, all such losses proceeding from or traceable to the same causative agency shall, at the Company’s option, be deemed to have been caused by one occurrence commencing at the beginning of the
policy period, it being understood and agreed that each renewal or annual anniversary date of the policy involved shall be deemed the beginning of a new policy period. 

 

	F.	Net Earned Premium 

 “Net
Earned Premium” as used herein is defined as the gross earned premium of the Company for the classes of business reinsured hereunder, less the earned portion of premiums ceded by the Company for reinsurance which inures to the benefit of this
Contract, less dividends paid or accrued. 
  

	G.	Written Premium 

 “Written
Premium” as used herein is defined as used in the company’s data system. 
  

	H.	Policy 

 “Policy” or
“Policies” as used herein shall mean the Company’s binders, policies and contracts providing insurance or reinsurance on the classes of business covered under this Contract. 

 

	I.	Contract Year 

 “Contract
Year” as used herein shall mean each 12-month period as follows: 
  

	 	1.	Contract Year 1: 12:01 a.m., Standard Time, January 1, 2012 (as set forth in the Company’s policies) to 12:01 a.m., Standard Time, January 1, 2013.

  

					
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	 	2.	Contract Year 2: 12:01 a.m., Standard Time, January 1, 2013 (as set forth in the Company’s policies) to 12:01 a.m., Standard Time, January 1, 2014.

  

	 	3.	Contract Year 3: 12:01 a.m., Standard Time, January 1, 2014 (as set forth in the Company’s policies) to 12:01 a.m., Standard Time, January 1, 2015.

  

	J.	Policy Year Manual Payroll (excluding clerical) 

 “Policy Year Manual Payroll (excluding clerical)” shall mean manual payroll as used for applying manual premium rates for policies incepting or renewed during the calendar year excluding manual
payroll for Manual Class Codes 8810 and 953. The 2011 Policy year manual payroll (excluding clerical) is estimated to be $3,700,000,000. 
  

	K.	Ultimate Net Loss 

“Ultimate Net Loss” shall mean the actual loss, including but not limited to ex gratia payments, any pre-judgment interest which
is included as part of the award or judgment, “Second Injury Fund” assessments that can be allocated to specific claims, Loss Adjustment Expense, 90% of Loss in Excess of Policy Limits, and 90% of Extra Contractual Obligations, paid or to
be paid by the Company on its net retained liability after making deductions for all recoveries, subrogations and all claims on inuring reinsurance, whether collectible or not; provided, however, that in the event of the insolvency of the Company,
payment by the Reinsurer shall be made in accordance with the provisions of the INSOLVENCY ARTICLE. Nothing herein shall be construed to mean that losses under this Contract are not recoverable until the Company’s Ultimate Net Loss has been
ascertained. 
 Notwithstanding the definition of “Ultimate Net Loss” herein, the provisions of paragraph D of the
COVERAGE ARTICLE as respects the Minnesota Workers’ Compensation Reinsurance Association shall apply. 
 ARTICLE V

 TERRITORY 

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

ARTICLE VI 

EXCLUSIONS 
  

	A.	This Contract does not apply to and specifically excludes the following: 

  

	 	1.	Reinsurance assumed by the Company under obligatory reinsurance agreements, except: 

 

	 	a.	Agency reinsurance where the policies involved are to be reunderwritten in accordance with the underwriting standards of the Company and reissued as Company policies at
the next anniversary or expiration date; and 

  

					
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	 	b.	Intercompany reinsurance between any of the reinsured companies under this Contract. 

 

	 	2.	Nuclear risks as defined in the “Nuclear Incident Exclusion Clause – Liability – Reinsurance – U.S.A.” (NMA 1590 21/9/67) attached hereto.

  

	 	3.	Liability as a member, subscriber or reinsurer of any Pool, Syndicate or Association, including Assigned Risk Plans or similar plans; however, this exclusion shall not
apply to liability under a Policy specifically designated to the Company from an Assigned Risk Plan or similar plan. 

  

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

  

	 	5.	Any “Act of Terrorism” directly or indirectly involving the use of nuclear, chemical, biological or radiological devices. 

 

	 	6.	Business written to apply in excess of a deductible of more than $25,000, and business issued to apply specifically in excess over underlying insurance. However, if the
Company is required, by any state regulation, to provide a deductible of more than $25,000, this exclusion shall not apply. 

  

	 	7.	Workers’ Compensation where the principal exposure, as defined by the governing class code, is: 

 

	 	a.	Operation of aircraft, but only if the annual estimated policy premium is $250,000 or more; 

 

	 	b.	Operation of Railroads, subways or street railways; 

  

	 	c.	Manufacturing, assembly, packing or processing of fireworks, fuses, nitroglycerine, magnesium, pyroxylin, ammunition or explosives. This exclusion does not apply to the
assembly, packing or processing of explosives when the estimated annual premium is under $250,000 and does not apply to the commercial use of explosives 

  

	 	d.	Underground mining. 

  

					
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	 	8.	As respects General Liability policies, exposures, other than those identified below, as included in the General Liability section of the Company’s Commercial
Lines Manual: 

  

	 	a.	Class 97111 – Logging; 

  

	 	b.	Class 58873 – Sawmill; 

  

	 	c.	Class 59984 – Woodyard and Drivers; 

  

	 	d.	Class 95410 – Grading of Land; 

  

	 	e.	Class 45819 – Lumber Yard; 

  

	 	f.	Class 10073 – Repair Shops and Drivers; 

  

	 	g.	Class 43822 – Timber Cruiser; 

  

	 	h.	Class 99793 – Truckmen Not Otherwise Classified; 

  

	 	i.	Class 91591 – Contractors – Subcontracted Work Other Than Construction; 

 

	 	j.	Class 49452 – Vacant Land. 

  

	 	9.	All excess of loss reinsurance assumed by the Company. 

  

	 	10.	Business written by the Company on a co-indemnity basis where the Company is not the controlling carrier. 

 

	 	11.	As regards interests which at the time of loss or damage are on shore, no liability shall attach hereto in respect to any loss or damage which is occasioned by war,
invasion, hostilities, acts of foreign enemies, civil war, rebellion, insurrection, military or usurped power, or martial law or confiscation by order of any government or public authority. This War Exclusion Clause shall not, however, apply to
interests which at time of loss or damage are within the territorial limits of the United States of America (comprising the Fifty States of the Union, the District of Columbia and including bridges between the United States of America and Mexico
provided they are under United States ownership), Canada, St. Pierre and Miquelon, provided such interests are insured under policies containing a standard war or hostilities or warlike operations exclusion clause. 

 

	B.	Notwithstanding the foregoing, insureds regularly engaged in operations not excluded under paragraph A above, but whose operations may include one or more perils
excluded therein, shall not be excluded from coverage afforded by this Contract, provided said operations are incidental to the main operations of the insured. Notwithstanding the foregoing, coverage extended under this paragraph for incidental
operations of an insured shall not apply to exposures excluded under subparagraphs 1 though 6 and 9 through 11 of paragraph A above. The Company shall be the judge of what constitutes an incidental part of the insured’s operation.

  

					
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	C.	Except for subparagraphs 1 though 6 and 9 through 11 of paragraph A above, if the Company is inadvertently bound or is unknowingly exposed (due to error or automatic
provisions of policy coverage) on a risk otherwise excluded in paragraph A above, such exclusion shall be waived. The duration of said waiver will not extend beyond the time that notice of such coverage has been received by a responsible
underwriting authority of the Company and for a period not exceeding 30 days thereafter, or such longer period required to conform with any notice of cancellation provisions prescribed by regulatory authorities, such period not to exceed 12 months
plus odd time (not exceeding 18 months). 

  

	D.	If the Company is required to accept an assigned risk which conflicts with one or more of the exclusions set forth in subparagraph 6 of paragraph A, reinsurance shall
apply, but only for the difference between the Company’s retention and the limit required by the applicable state statute, and in no event shall the Reinsurer’s liability exceed the limit set forth in the Coverage Article.

  

	E.	Notwithstanding the foregoing, any reinsurance falling within the scope of one or more of the exclusions set forth above that is specially accepted by the Reinsurer
from the Company shall be covered under this Contract and be subject to the terms hereof. 

  

	F.	Should a court of competent jurisdiction invalidate any exclusion or expand coverage of the original Policy of the Company, any amount of Loss for which the Company
would not be liable, except for such invalidation or expansion of coverage, shall not be subject to any of the exclusions, conditions and limitations hereinafter set forth under this Contract. 

ARTICLE VII 

TERRORISM RISK INSURANCE PROGRAM REAUTHORIZATION ACT 
 The Reinsurer will indemnify the Company for all loss resulting from Acts of Terrorism (excluding Acts of Terrorism caused by or result from nuclear, biological, chemical or radiological events), but only
to the extent that such losses are recoverable under the terms and conditions of this contract and that such losses only include that portion of loss that is not recoverable under the Terrorism Risk Insurance Program Reauthorization Act of 2007
(TRIPRA) and any subsequent amendments. Under no circumstances will Reinsurers fund any losses recoverable under TRIPRA. In the event of a subsequent recovery under TRIPRA in respect of any paid loss under this Contract, that recovery shall inure to
the benefit of the Reinsurers. 

  

					
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 ARTICLE VIII 
 COVERAGE 
  

	A.	The Reinsurer shall be liable for the amount of Ultimate Net Loss in excess of the Company’s retention, being $5,000,000 each Loss Occurrence, subject to a limit
of liability to the Reinsurer of $5,000,000 each Loss Occurrence. The Reinsurer’s liability in respect of all losses occurring during the term of this Contract shall not exceed $10,000,000 any one Contract Year or $20,000,000 over all Contract
Years. 

 For avoidance of doubt, this Contract shall be subject to a Loss Occurrence limit equal to $5,000,000 and
shall be inclusive of all indemnity, Extra Contractual Obligations, Loss in Excess of Policy Limits amounts and Loss Adjustment Expenses recoverable under this Contract with respect to each Loss Occurrence. 

 

	B.	As respects General Liability business, the Reinsurer shall be liable for the amount of Ultimate Net Loss in excess of the Company’s retention, being $5,000,000
each Loss Occurrence, subject to a limit of liability of $5,000,000 each Loss Occurrence, subject to a maximum recovery of $10,000,000 any one Contract Year or $20,000,000 over all Contract Years. 

 

	C.	The Company shall be permitted to purchase (or maintain) other reinsurance which inures to the benefit of this Contract. 

 

	D.	The Company shall be permitted to carry excess of loss reinsurance applying to Workers’ Compensation risks in the State of Minnesota, actual recoveries under which
shall inure to the benefit of this Contract. Such coverage shall be provided through the Minnesota Workers’ Compensation Reinsurance Association. Notwithstanding the treatment of inuring coverage in the definition of Ultimate Net Loss, the
liability of the Reinsurer for Minnesota Workers’ Compensation risks is not released. 

  

	E.	As respects Employers Liability and General Liability, the maximum net subject Policy limit (except statutory where required by law) as respects any one Policy shall be
$2,000,000 or the Company shall be deemed to have purchased inuring excess facultative reinsurance for subject Policy limits in excess of $2,000,000. 

 ARTICLE IX 
 MATERIAL CHANGE 

The Company shall not introduce material changes in its generally established practices, including but not limited to claims, acceptance and underwriting
policies, its inuring reinsurance protection and loss reserving process (including the allocation of loss adjustment expenses between allocated and unallocated) in any manner which materially affects this Contract, unless the Company has received
the prior written approval from the Reinsurer. 

  

					
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	A.	Prior to the start of each of Contract Year 2 and Contract Year 3, a determination shall be made as respects whether a Material Change to the underlying Business
Covered by this Contract has occurred. 

  

	B.	The Company shall provide to Reinsurer, no later than October 15 of each of 2012 and 2013, a schedule of Written Premium in total and for the Governing
Class Groups enumerated in subparagraph 5 below. Written Premium for purposes of this Article shall be: 

  

	 	1.	With respect to the determination for Contract Year 2: actual Written Premium from the effective date of this Contract, being January 1, 2012 through
September 30, 2012 plus projected Written Premium from October 1, 2012 through December 31, 2013, and 

  

	 	2.	With respect to the determination for Contract Year 3: actual Written Premium from the effective date of this Contract, being January 1, 2012 through
September 30, 2013 plus projected Written Premium from October 1, 2013 through December 31, 2014. 

  

	 	3.	To the extent that the ratio of Written Premium for each of the Governing Class Groups enumerated in subparagraph 5 below to Written Premium in total, both figures as
calculated above, is within the applicable ranges listed in subparagraph 5, no Material Change in Business Covered shall have been deemed to occur and the operation of this Contract shall continue without change or modification.

  

	 	4.	To the extent that the ratio of Written Premium for any of the Governing Class Groups enumerated in subparagraph 5 below to Written Premium in total, both figures as
calculated above, is outside the applicable ranges listed in subparagraph 5, or to the extent that the Logging component of the Lumber Governing Class Group exceeds five percentage points of Written Premium in total, a Material Change in
Business Covered shall have been deemed to occur. 

  

	 	5.	The Governing Class Groups and their applicable ranges shall be as follows: 

 Construction – No less than 20% nor more than 50% 
 Trucking – No less
than 12.5% nor more than 35% 
 Lumber – No less than 2.5% nor more than 17.5% 

Roofing – No less than 2.5% nor more than 17.5% 
 Manufacturing – No less than 1% nor more than 15%. 
 All such ratios being
calculated as total Written Premium for the enumerated Governing Class Groups as calculated under paragraph B above for the period specified therein divided by total Written Premium for all Governing Class Groups as calculated under paragraph B
above for the period specified therein. 

  

					
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	C.	The Company shall provide to Reinsurer, no later than October 15 of each of 2012 and 2013, a calculation of Policy Year Manual Payroll (excluding clerical) for the
current Contract Year. Policy Year Manual Payroll (excluding clerical) for purposes of this Article shall be: 

  

	 	1.	With respect to the determination for Contract Year 2: actual policy year manual payroll from the effective date of this Contract, being January 1, 2012 through
September 30, 2012 plus projected policy year manual payroll from October 1, 2012 through December 31, 2012, in each case excluding policy year manual payroll in Manual Class Codes 8810 and 953, and 

 

	 	2.	With respect to the determination for Contract Year 3: actual policy year manual payroll from the first day of Contract Year 2, being January 1, 2013 through
September 30, 2013 plus projected policy year manual payroll from October 1, 2013 through December 31, 2013, in each case excluding policy year manual payroll in Class Codes 8810 and 953. 

 

	 	3.	To the extent that Policy Year Manual Payroll (excluding clerical) as determined above for Contract Year 2 is less than or equal to $4,440,000,000, no Material Change
in Business Covered shall have been deemed to occur and the operation of this Contract shall continue without change or modification. 

  

	 	4.	To the extent that Policy Year Manual Payroll (excluding clerical) as determined above for Contract Year 2 is more than $4,440,000,000, a Material Change in Business
Covered shall have been deemed to occur. 

  

	 	5.	To the extent that Policy Year Manual Payroll (excluding clerical) as determined above for Contract Year 3 is less than or equal to $5,000,000,000, no Material Change
in Business Covered shall have been deemed to occur and the operation of this Contract shall continue without change or modification. 

  

	 	6.	To the extent that Policy Year Manual Payroll (excluding clerical) as determined above for Contract Year 3 is more than $5,000,000,000, a Material Change in Business
Covered shall have been deemed to occur. 

  

	D.	A Material Change shall have been deemed to occur if the Company acquires, during the term of this Contract, any insurance or reinsurance company having annual subject
premium of $20,000,000 or more. 

  

	E.	If a Material Change has been deemed to occur under paragraphs B, C or D above for any Contract Year, Company and Reinsurer shall mutually agree to such modifications
of this contract as shall be deemed necessary to reflect the Material Change, including but not limited to, changes in Exclusions, Reinsurance Premium, the Reinsurer’s fixed expenses or any other Contract features or the adoption of new
limitations or changes in coverage. 

  

	F.	If a Material Change has been deemed to occur under paragraphs B or C above for either Contract Year 2 or Contract Year 3, and the Company and Reinsurer are not able to
mutually agree to the necessary modifications described in paragraph E above, then the Reinsurer may cancel the Contract at the end of Contract Year 1 or Contract Year 2 as applicable, by the provision of 45 calendar day’s prior written notice
by certified mail. If such notice of cancellation is not received, the operation of this Contract shall continue without change. 

  

					
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	G.	In the event of termination in accordance with paragraph F, above, paragraph C of the SPECIAL TERMINATION ARTICLE shall apply with respect to the calculation of the
contract terms listed therein. 

  

	H.	If a Material Change has been deemed to occur under paragraph D above for any Contract Year and the Company and Reinsurer are not able to mutually agree to the
necessary modifications described in paragraph E above, then this Contract shall not apply to the acquired company and any business written by such acquired company shall be excluded. 

ARTICLE X 

REINSURANCE PREMIUM 
  

	A.	As premium for the reinsurance provided hereunder, the Company shall pay the Reinsurer 0.85% of its Net Earned Premium for each Contract Year during the term of this
Contract, subject to a minimum annual premium of $2,400,000. 

  

	B.	The Company shall pay the Reinsurer a deposit premium of $2,400,000 for each Contract Year paid in four equal installments on each
January 1, April 1, July 1 and October 1 of the respective Contract Year. 

  

	C.	Within 90 days after the expiration of each Contract Year, the Company shall provide a report to the Reinsurer setting forth the premium due hereunder, computed in
accordance with paragraph A, and any additional premium due the Reinsurer or return premium due the Company shall be remitted within 15 days of receipt of such report. 

 

	D.	If losses ceded to this Contract exceed $5,000,000 for all Contract Years, the Company shall pay an additional premium equal to 40% of the ceded losses in excess of
$5,000,000, subject to a maximum additional premium of $2,000,000 for all Contract Years. The additional premium shall be in proportion to the amount of incurred losses ceded under this contract in excess of $5,000,000 and shall be deemed due and
payable at the inception of this Contract. 

 ARTICLE XI 

FUNDS WITHHELD ACCOUNT 
  

	A.	At the subscribing reinsurer’s option, the Company shall retain any and all Reinsurance Premiums due hereunder on a Funds Withheld basis, provided however that
payment of the subscribing reinsurer’s fixed expenses at a rate of 30% of the Reinsurance Premium shall be paid in cash to the subscribing reinsurer at such time as the respective Reinsurance Premiums are due and shall not be affected by the
terms of this FUNDS WITHHELD ACCOUNT ARTICLE. 

  

					
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	B.	In consideration of the subscribing reinsurer choosing this Funds Withheld option, the Company agrees (i) to calculate a Notional Funds Withheld Account Balance
from the inception of this Contract until there is a complete and final release of all of the Reinsurer’s obligations to the Reinsured under this Contract and (ii) that the Notional Funds Withheld Account Balance (as defined below) may be
offset by the Reinsurer against liability of any nature whatsoever (whether then contingent, due and payable, or in the future becoming due) that it may then have, or in the future may have, under this Contract and (iii) such offset shall occur
as a condition precedent to any payments by the Reinsurer hereunder. 

  

	C.	As of the close of each calendar quarter, and at any other time as required, the Company shall calculate the balance of the Notional Funds Withheld Account as follows:

  

	 	1.	100% of the balance of the Notional Funds Withheld Account from the immediately preceding calendar quarter (at the Inception Date of this Contract, the starting balance
is zero unless an additional premium becomes due in which case the starting balance shall be the amount of the additional premium); less 

  

	 	2.	100% of the Company’s Ultimate Net Loss paid or deemed paid by the Reinsurer since the preceding calendar quarter; plus 

 

	 	3.	The Reinsurance Premium, excluding any additional premium, deemed received by the Reinsurer since the preceding calendar quarter; less 

 

	 	4.	The Reinsurer’s fixed expenses at a rate of 30% of (3); plus 

  

	 	5.	The interest credit since the preceding calendar quarter. Such interest credit shall be equal to the result of the “interest crediting rate” applied to the
quarter end sum of [1 minus 2 plus 3 minus 4]. 

 The interest crediting rate shall be equal to one fourth (.25) of
the greater of: 
  

	 	a.	The five (5) year U.S. Treasury note rate as published in the Wall Street Journal on the first business day of each Contract Year, or 

 

	 	b.	4.25%. 

  

	E.	If the Contract has not been commuted by December 31, 2017, a subscribing reinsurer may terminate the Funds Withheld election under this FUNDS WITHHELD ACCOUNT
ARTICLE at their option on July 1, 2018 or on each January 1st or July 1st subsequent to that date (the Reversion Date) by giving 90 days written notice to the Company. 

Following receipt of written notice to terminate the Funds Withheld election, the Company will calculate the Notional Funds Withheld
Account Balance as of the Reversion Date and remit such balance to the reinsurer within 15 days. Subsequent to such termination, the Notional Experience Account Balance will be calculated on a funds transferred basis. 

  

					
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	F.	A subscribing reinsurer may terminate the Funds Withheld election under this FUNDS WITHHELD ACCOUNT ARTICLE by giving 15 days written notice to the Company upon the
happening of any one of the following circumstances: 

  

	 	1.	A State Insurance Department or other legal authority orders the Company to cease writing business, or 

 

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

  

	 	3.	The Company receives an A. M. Best rating of lower than B + +, or 

  

	 	4.	American Interstate Insurance Company’s total adjusted capital is less than 225% of its authorized control level risk based capital. 

Following receipt of written notice to terminate the Funds Withheld election, the Company will calculate the Notional Funds Withheld
Account Balance as of that date and remit such balance to the reinsurer within 15 days. Subsequent to such termination, the Notional Experience Account Balance will be calculated on a funds transferred basis. 

 

	G.	For all avoidance of doubt, it is intended that if a subscribing reinsurer chooses the Funds Withheld option as described above then the Notional Funds Withheld Account
Balance as calculated above at any date shall equal the subscribing reinsurer’s share of the Notional Experience Account, as calculated in the NOTIONAL EXPERIENCE ACCOUNT ARTICLE as of that same date. 

ARTICLE XII 

NOTICE OF LOSS AND LOSS SETTLEMENTS 
 All loss settlements made by the Company that are within the terms and conditions of this Contract (including but not limited to ex gratia payments) shall be binding upon the Reinsurer, and the Reinsurer
agrees to pay all amounts for which it may be liable upon receipt of satisfactory evidence of the amount paid by the Company. Upon receipt of the Summary Report as described below in the REPORTS AND REMITTANCES ARTICLE, the Reinsurer agrees to
promptly pay or allow, as the case may be, its share of each such settlement in accordance with this Contract. 
 ARTICLE
XIII 
 LIABILITY OF REINSURERS 
 All reinsurances for which the Reinsurer shall be liable by virtue of this Contract shall be subject in all respects to the same rates, terms, conditions, interpretations and waivers and to the same
modifications, alterations, and cancellations, as the respective policies to which such reinsurances relate, the true intent of the parties to this Contract being that the Reinsurer shall follow the fortunes of the Company. 

  

					
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 ARTICLE XIV 
 LATE PAYMENTS 
 (The provisions of this article shall not be implemented unless
specifically invoked, in writing, by one of the parties to the Contract.) 
  

	A.	In the event any premium, loss or other payment due either party is not received by the Intermediary hereunder by the payment due date, the party to whom payment is due
may, by notifying the Intermediary in writing, require the debtor party to pay, and the debtor party agrees to pay, an interest penalty on the amount past due calculated for each such payment on the last business day of each month as follows:

  

	 	1.	The number of full days which have expired since the due date or the last monthly calculation, whichever the lesser; times 

 

	 	2.	1/365ths of a rate equal to the 90-day Treasury Bill rate as published in The Wall Street Journal on the first business day following the date a remittance
becomes due plus 300 basis points; times 

  

	 	3.	The amount past due, including accrued interest. 

 It is agreed that interest shall accumulate until payment of the original amount due plus interest penalties have been received by the Intermediary. 

 

	B.	The establishment of the due date shall, for purposes of this Article, be determined as follows: 

 

	 	1.	As respects the payment of deposits and premiums due the Reinsurer, the due date shall be as provided for in the applicable section of this Contract.

  

	 	2.	As respects any claim or loss payment due the Company, the due date shall be as provided for in the applicable section of this Contract. 

 

	 	3.	As respects any payment, adjustment or return due either party not otherwise provided for in subparagraphs 1 and 2 of this paragraph, the due date shall be as provided
for in the applicable section of this Contract. 

  

	C.	For purposes of interest calculation only, amounts due hereunder shall be deemed paid upon receipt by the Intermediary. The validity of any claim or payment may be
contested under the provisions of this Contract. If the debtor party prevails in an arbitration, or any other proceeding, there shall be no interest penalty due. Otherwise, any interest will be calculated and due as outlined above.

  

	D.	Interest penalties arising out of the application of this Article that are $100 or less from any party shall be waived unless there is a pattern of late payments
consisting of three or more items over the course of any 12-month period. 

  

					
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 ARTICLE XV 
 REPORTS AND REMITTANCES 
  

	A.	Quarterly Reports and Remittances: 

  

	 	1.	While this Contract is in force, within 60 calendar days from the end of each calendar quarter, the Company shall supply to the Reinsurer a Quarterly Statement, as
filed with the Louisiana Department of Insurance and a Summary Report listing: 

  

	 	a.	The Company’s quarterly Net Earned Premium. 

  

	 	b.	The aggregate amount of Ultimate Net Loss, including paid, case outstanding, and IBNR components of this total. 

 

	 	c.	The portion of paid, case outstanding, and IBNR Ultimate Net Loss ceded under this Contract from inception of this Contract and for the quarter.

  

	 	d.	Claims reserved by the Company at 50% of its retention hereunder. 

  

	 	e.	A report showing the Notional Funds Withheld Account Balance as calculated in the FUNDS WITHHELD ACCOUNT ARTICLE (if applicable). 

All for business covered during the term of this Contract as reflected in the Quarterly Statement. 

 

	 	2.	While this contract is in force, within 60 calendar days from the end of each calendar quarter, the subscribing reinsurers shall supply to the Company a report showing
the Notional Experience Account Balance as calculated in the NOTIONAL EXPERIENCE ACCOUNT ARTICLE. 

  

	 	3.	Quarterly within 5 business days from the beginning of each calendar quarter, the Company shall pay to the Reinsurer the reinsurance premium as stipulated in the
REINSURANCE PREMIUM ARTICLE. 

  

	 	4.	Payment to the Company of quarterly ceded paid loss amounts due from the Reinsurer, or payment to the Reinsurer of quarterly ceded paid loss adjustments due from the
Company, shall be in arrears and shall be made within 45 calendar days from actual receipt by the Reinsurer of the Summary Report in paragraph A.1, above. 

  

	B.	The Company shall furnish to the Reinsurer, upon its written request, any and all actuarial, accounting or statistical data as may be required by the Reinsurer for
regulatory filing purposes, reserve setting or any other reasonable purpose. 

  

					
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 ARTICLE XVI 
 COMMUTATION 
  

	A.	The Reinsurer may cancel and commute this Contract at any time with 90 calendar days advance written notice by certified mail, but only in the event(s) of:

  

	 	1.	Payment by the Reinsurer of the overall aggregate limit; or 

  

	 	2.	Failure by the Company to pay any amounts when due under this Contract, if such default is not cured within 30 calendar days following receipt by certified mail by the
Company of notice of such default from the subscribing reinsurer. 

  

	B.	At any time after expiration or termination of this Contract the Company may commute this Contract with 90 calendar days advance written notice by certified mail, but
only if the Notional Experience Account balance is greater than zero. 

  

	C.	As provided within the SPECIAL TERMINATION ARTICLE, upon the Company’s termination of a subscribing reinsurer’s share in the Contract upon the happening of
any one of the enumerated circumstances, the Company has the option, but not the obligation, to commute this Contract with written notice. 

  

	D.	Upon Commutation by the Reinsurer in accordance with paragraph A, above, or Commutation by the Company in accordance with paragraph B, above, the following shall occur:

  

	 	1.	The Notional Experience Account balance shall be calculated, as stipulated in the NOTIONAL EXPERIENCE ACCOUNT ARTICLE, as of the date of commutation. If the date of
commutation is prior to December 31, 2017, the Notional Experience Account balance shall be calculated using a reinsurer’s fixed expense rate of 29% in place of the 30% indicated in the NOTIONAL EXPERIENCE ACCOUNT ARTICLE. If the date of
commutation is prior to December 31, 2016, the Notional Experience Account balance shall be calculated using a reinsurer’s fixed expense rate of 28% in place of the 30% indicated in the NOTIONAL EXPERIENCE ACCOUNT ARTICLE. Under such
circumstances, this same 29% or 28% rate shall also be used in calculating the balance of the Funds Withheld Account under the FUNDS WITHHELD ACCOUNT ARTICLE such that the two account balances for any subscribing reinsurer that has elected the Funds
Withheld option shall be equal. 

  

	 	2.	The “Commutation Settlement Amount” will be equal to the amount under paragraph D.1, above, and the Reinsurer shall remit to the Company this Commutation
Settlement Amount within 5 U.S. business days following such calculation. 

  

	 	3.	 Upon receipt of the Commutation Settlement Amount, the Company shall provide the Reinsurer with a complete and final release of any further liability
under this Contract, or so deemed; concurrently, the Company shall release any Letters of Credit provided by the Reinsurer under the UNAUTHORIZED REINSURANCE ARTICLE. In the event that any or all Letters of Credit have not been released within 5
business days of the receipt of the Commutation Settlement Amount, it is agreed 

  

					
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that the Reinsurer can bill the Company at any time and the Company has to pay to the Reinsurer an annualized fee of 200 bps on the amount of any Letters of Credit not released 5 business days
after the receipt of the Commutation Settlement Amount. 

  

	E.	Upon Commutation by the Company in accordance with paragraph C above and the SPECIAL TERMINATION ARTICLE, the Commutation Settlement Amount shall be the greater of the
amount calculated in paragraph D or the net present value of outstanding ceded reserves including incurred but not reported losses. 

 If the Reinsurer disputes the Commutation Settlement Amount established by the Company under this paragraph E, then such dispute shall be settled by a panel of three actuaries, one to be chosen by each
party and the third by the two so chosen. If either party refuses or neglects to appoint an actuary within 30 days, the other party may appoint two actuaries. If the two actuaries fail to agree on the selection of a third actuary within 30 days of
their appointment, each of them shall name two, of whom the other shall decline one and the decision shall be made by drawing lots. All the actuaries shall be Fellows of the Casualty Actuarial Society or members of the American Academy of Actuaries.
All of the actuaries shall be independent of either party to this Contract. Each party shall bear the cost of their appointed actuary (or actuary appointed for them if they fail to make a timely appointment) and shall share the cost evenly of the
third actuary. 
 The settlement agreed upon by a majority of the panel of actuaries shall be final and binding on both parties
and set forth in a sworn written document expressing their professional opinion that said value is fair for the complete mutual release of all liabilities in respect of such reserves. 

ARTICLE XVII 

NOTIONAL EXPERIENCE ACCOUNT 
 As
of the close of each calendar quarter, and at any other time as stipulated in the COMMUTATION ARTICLE, the subscribing reinsurer shall calculate the value of the Notional Experience Account as follows: 

 

	1.	100% of the balance of the Notional Experience Account from the immediately preceding calendar quarter (at the Inception Date of this Contract, the starting balance is
zero unless an additional premium becomes due in which case the starting balance shall be the amount of the additional premium); less 

  

	2.	100% of the Company’s Ultimate Net Loss paid by the Reinsurer since the preceding calendar quarter; plus 

 

	3.	The Reinsurance Premium, excluding any additional premium, deemed received by the Reinsurer since the preceding calendar quarter; less 

 

	4.	The Reinsurer’s fixed expenses at a rate of 30% of (3); plus 

  

					
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	5.	The interest credit since the preceding calendar quarter. Such interest credit shall be equal to the result of the “interest crediting rate” applied to the
quarter end sum of [1 minus 2 plus 3 minus 4]. 

 The interest crediting rate shall be equal to one fourth (0.25)
of: 
  

	 	a.	The five (5) year U.S. Treasury note rate as published in the Wall Street Journal on the first business day of each Contract Year minus fifty (50) basis
points if the subscribing reinsurer elects to receive premium on a funds transferred basis, or 

  

	 	b.	The greater of the five (5) year U.S. Treasury note rate as published in the Wall Street Journal on the first business day of each Contract Year, or 4.25% if the
subscribing reinsurer elects the provisions of the FUNDS WITHHELD ACCOUNT ARTICLE. 

 ARTICLE XVIII

 ANNUITIES AT THE COMPANY’S OPTION 
  

	A.	Whenever the Company is required, or elects, to purchase an annuity or to negotiate a structured settlement, either in satisfaction of a judgment or in an out-of-court
settlement or otherwise, the cost of the annuity or the structured settlement, as the case may be, shall be deemed part of the Company’s Ultimate Net Loss. 

 

	B.	The terms “annuity” or “structured settlement” shall be understood to mean any insurance policy, lump sum payment, agreement or device of whatever
nature resulting in the payment of a lump sum by the Company in settlement of any or all future liabilities which may attach to it as a result of an occurrence. 

 

	C.	In the event the Company purchases an annuity which inures in whole or in part to the benefit of the Reinsurer, it is understood that the liability of the Reinsurer is
not released thereby. In the event the Company is required to provide benefits not provided by the annuity for whatever reason, the Reinsurer shall pay its share of any loss. 

ARTICLE XIX 

SUNSET 
 Seven (7) years
after the expiration of this Contract (i.e., January 1, 2022), the Company shall advise the Reinsurer of any Loss Occurrences attaching to this Contract which have not been finally settled and which may result in a claim by the Company under
this Contract. No liability shall attach hereunder for any claim or claims not reported to the Reinsurer within this 7-year period. If a loss arising out of a Loss Occurrence is reported during this period, all losses arising out of the same Loss
Occurrence shall be deemed reported under this paragraph regardless of when notification of loss is provided. 
 If the Notional Experience
Account balance is positive and the Company does not commute this Contract on or before December 31, 2021, the Company shall pay to the Reinsurer in cash each January 1, beginning January 1, 2022, an annual charge equal 200 basis
points times the then current balance in the Notional Experience Account. 

  

					
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 ARTICLE XX 
 SUBROGATION 
 The Reinsurer shall be credited with subrogation or salvage recoveries
(i.e., reimbursement obtained or recovery made by the Company, less Loss Adjustment Expense incurred in obtaining such reimbursement or making such recovery) on account of claims and settlements involving reinsurance hereunder. Subrogation or
salvage recoveries thereon shall always be used to reimburse the excess carriers in the reverse order of their priority according to their participation before being used in any way to reimburse the Company for its primary loss. The Company, at its
sole option and discretion, may enforce its rights to subrogation relating to any loss, a part of which loss was sustained by the Reinsurer, and may prosecute all claims arising out of such rights. 

ARTICLE XXI 

ERRORS AND OMISSIONS 
 Any
inadvertent delay, omission or error shall not be held to relieve either party hereto from any liability which would attach to it hereunder if such delay, omission or error had not been made, provided such omission or error is rectified upon
discovery. 
 ARTICLE XXII 
 OFFSET 
 The Company and the Reinsurer may offset any balance or amount due from one
party to the other under this Contract or any other contract heretofore or hereafter entered into between the Company and the Reinsurer, whether acting as assuming reinsurer or ceding company. The party asserting the right of offset may exercise
such right any time whether the balances due are on account of premiums or losses or otherwise. 
 ARTICLE XXIII

 CURRENCY 
  

	A.	Whenever the word “Dollars” or the “$” sign appears in this Contract, they shall be construed to mean United States Dollars and all transactions
under this Contract shall be in United States Dollars. 

  

	B.	Amounts paid or received by the Company in any other currency shall be converted to United States Dollars at the rate of exchange at the date such transaction is
entered on the books of the Company. 

  

					
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 ARTICLE XXIV 
 TAXES 
 In consideration of the terms under which this Contract is issued, the
Company will not claim a deduction in respect of the premium hereon when making tax returns, other than income or profits tax returns, to any state or territory of the United States of America, the District of Columbia or Canada. 

ARTICLE XXV 

FEDERAL EXCISE TAX 
 (Applicable
to those subscribing reinsurers, excepting Underwriters at Lloyd’s London and other subscribing reinsurers exempt from Federal Excise Tax, who are domiciled outside the United States of America.) 

 

	A.	The subscribing reinsurer has agreed to allow for the purpose of paying the Federal Excise Tax the applicable percentage of the premium payable hereon (as imposed under
Section 4371 of the Internal Revenue Code) to the extent such premium is subject to the Federal Excise Tax. 

  

	B.	In the event of any return of premium becoming due hereunder the subscribing reinsurer will deduct the applicable percentage from the return premium payable hereon and
the Company or its agent should take steps to recover the tax from the United States Government. 

 ARTICLE
XXVI 
 NET RETAINED LINES 
  

	A.	This Contract applies only to that portion of any Policy which the Company retains net for its own account and, in calculating the amount of any loss hereunder and also
in computing the amount or amounts in excess of which this Contract attaches, only loss or losses in respect of business covered which the Company retains net for its own account shall be included. 

 

	B.	The amount of the Reinsurer’s liability hereunder in respect of any loss or losses shall not be increased by reason of the inability of the Company to collect from
any other reinsurer(s), whether specific or general, any amounts which may have become due from such reinsurer(s), whether such inability arises from the insolvency of such other reinsurer(s) or otherwise. 

  

					
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 ARTICLE XXVII 
 THIRD PARTY RIGHTS 
 This Contract is solely between the Company and the Reinsurer,
and in no instance shall any other party have any rights under this Contract except as expressly provided otherwise in the INSOLVENCY ARTICLE. 
 ARTICLE XXVIII 
 SEVERABILITY 

If any provision of this Contract shall be rendered illegal or unenforceable by the laws or regulations 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 Contract or the enforceability of such provision in any other jurisdiction. 

ARTICLE XXIX 

GOVERNING LAW 
 This Contract
shall be governed as to performance, administration and interpretation by the laws of the State of Louisiana, exclusive of that state’s rules with respect to conflicts of law, except as to rules with respect to credit for reinsurance in which
case the applicable rules of all states shall apply. 
 ARTICLE XXX 

INSPECTION OF RECORDS 
  

	A.	The Reinsurer or its duly designated representative(s) will have, upon providing reasonable advance notice to the Company, access to the Company’s underwriting,
accounting and/or claim files pertaining to the subject matter of this Contract during the period of this Contract and subsequently until all liabilities are extinguished; provided, however, that if any undisputed amount is overdue from the
Reinsurer to the Company for any reason, Reinsurer will have such access to records only upon payment of such overdue undisputed amounts to the Company. Notwithstanding the foregoing, the Company may withhold information from the Reinsurer which if
disclosed would violate a third-party confidentiality agreement, attorney client privilege, attorney work product rule protection, or which is not protected by the common interest doctrine or like legal principle. The Company shall in all cases
advise the Reinsurer that information has been withheld and the circumstance(s) under which such an action has been taken, and provide to the Reinsurer, in good faith, alternative information wherever possible. 

 

	B.	The Reinsurer may, at its own expense, reasonably take copies of such records. 

  

					
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	C.	The Reinsurer’s right to inspect underwriting records, premium books and premium records will terminate seven years after expiry of this Contract, unless
electronic records are retained in connection with this Contract. Nothing in this Article requires the Company to maintain any document for a period longer than that required under the Company’s document retention policies and procedures.

  

	D.	If the Reinsurer makes any inspection of the Company’s claim files under this Contract and, as a result of the inspection, the claim is contested or disputed, the
Reinsurer will provide the Company, at the Company’s request, with a summary of the findings of the inspection, summarising the reasons for contesting or disputing the subject claim. 

ARTICLE XXXI 

CONFIDENTIALITY 
  

	A.	The Reinsurer hereby acknowledges that the documents, information, and data provided to the Reinsurer by the Company, whether directly or through an authorized agent,
in connection with the placement and execution of this Contract (“Confidential Information”) are proprietary and confidential to the Company. 

  

	B.	Absent the written consent of the Company, the Reinsurer will not disclose any Confidential Information to any third parties, except when: 

 

	 	1.	The disclosure is to professional advisors or to authorized agents of the Reinsurer performing underwriting, claim handling, pricing, placement and/or evaluation
services for the Reinsurer; or 

  

	 	2.	The Confidential Information is publicly known or has become publicly known through no unauthorized act of the Reinsurer; or 

 

	 	3.	Required by retrocessionaires subject to the business ceded to this Contract; or 

 

	 	4.	Required by state regulators performing an audit of the Reinsurer’s records and/or financial condition; or 

 

	 	5.	Required by auditors performing an audit of the Reinsurer’s records in the normal course of business. 

 

	C.	Further, the Reinsurer agrees not to use any Confidential Information for any purpose not permitted by this Contract or not related to the performance of their
obligations or enforcement of their rights under this Contract. 

  

	D.	Notwithstanding the above, in the event that the Reinsurer is required by court order, other legal process, or any regulatory authority to release or disclose any or
all of the Confidential Information, the Reinsurer agrees to provide the Company with prior notice when legally permissible or prompt notice when prior notice is not legally permissible, so that the Company may seek a protective order or other
appropriate remedy, The Reinsurer agrees to provide, by written or electronic mail, reasonable advance notice of same prior to such release or disclosure and to use their reasonable best efforts to assist the Company in maintaining the
confidentiality provided for in this Article. 

  

					
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	E.	The provisions of this Article will extend to the officers, directors, shareholders, and employees of the Reinsurer and its affiliates, who have received Confidential
Information in accordance with this Contract and will be binding upon their successors and assigns. 

ARTICLE XXXII 

INSOLVENCY 
  

	A.	In the event of the insolvency of the Company, this reinsurance shall be payable directly to the Company or to its liquidator, receiver, conservator or statutory
successor, with reasonable provision for verification, on the basis of the liability of the Company without diminution because of the insolvency of the Company or because the liquidator, receiver, conservator or statutory successor of the Company
has failed to pay all or a portion of any claim. It is agreed, however, that the liquidator, receiver, conservator or statutory successor of the Company shall give written notice to the Reinsurer of the pendency of a claim against the Company
indicating the Policy or bond reinsured which claim would involve a possible liability on the part of the Reinsurer within a reasonable time after such claim is filed in the conservation or liquidation proceeding or in the receivership, and that
during the pendency of such claim, the 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 that it may deem available to the Company or its
liquidator, receiver, conservator or statutory successor. The expense thus incurred by the Reinsurer shall be chargeable, subject to the approval of the Court, against the Company as part of the expense of conservation or 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 Reinsurer. 

  

	B.	It is further agreed that, in the event of the insolvency of the Company, the reinsurance under this Contract shall be payable directly by the Reinsurer to the Company
or its liquidator, receiver, conservator, or statutory successor, except (1) where this Contract specifically provides another payee of such reinsurance in the event of the insolvency of the Company or (2) where the Reinsurer with the
consent of the direct insured or insureds has assumed such Policy obligations of the Company as direct obligations of the Reinsurer to the payee under such Policies and in substitution for the obligations of the Company to such payees.

  

	C.	In the event of the insolvency of any company or companies listed in the designation of “Company” under this Contract, this Article shall apply only to the
insolvent company or companies. 

 ARTICLE XXXIII 

ARBITRATION 
  

	A.	As a condition precedent to any right of action hereunder, any irreconcilable dispute arising out of the interpretation, performance or breach of this Contract,
including the formation or validity thereof, whether arising before or after the expiry or termination of the Contract, shall be submitted for decision to a panel of 3 arbitrators. Notice requesting arbitration will be in writing and sent by
certified mail, return receipt requested, or such reputable courier service as is capable of returning proof of receipt of such notice by the recipient to the party demanding arbitration. 

  

					
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	B.	The Company shall have the option to either litigate or arbitrate where: 

  

	 	1.	The Reinsurer makes any allegation of misrepresentation, non-disclosure, concealment, fraud or bad faith; or 

 

	 	2.	The Reinsurer experiences any of the circumstances set forth in subparagraphs 1 through 7 of paragraph A of the SPECIAL TERMINATION ARTICLE. 

 

	C.	One arbitrator shall be appointed by each party. If either party fails to appoint its arbitrator within 30 days after being requested to do so by the other party, the
latter, after 10 days notice by certified mail or reputable courier as provided above of its intention to do so, may appoint the second arbitrator. 

  

	D.	The two arbitrators shall, before instituting the hearing, appoint an impartial third arbitrator who shall preside at the hearing. Should the two arbitrators fail to
choose the third arbitrator within 30 days of the appointment of the second arbitrator, the parties shall appoint the third arbitrator pursuant to the AIDA Reinsurance and Insurance Arbitration Society – U.S. (ARIAS) Umpire Selection Procedure.
All arbitrators shall be disinterested active or former senior executives of insurance or reinsurance companies or Underwriters at Lloyd’s, London. 

  

	E.	Within 30 days after notice of appointment of all arbitrators, the panel shall meet and determine timely periods for briefs, discovery procedures and schedules for
hearings. The panel shall be relieved of all judicial formality and shall not be bound by the strict rules of procedure and evidence. Unless the panel agrees otherwise, arbitration shall take place in DeRidder, Louisiana but the venue may be changed
when deemed by the panel to be in the best interest of the arbitration proceeding. Insofar as the arbitration panel looks to substantive law, it shall consider the law of the State of Louisiana. The decision of any 2 arbitrators when rendered in
writing shall be final and binding. The panel is empowered to grant interim relief as it may deem appropriate. 

  

	F.	In the event an arbitrator is unable to serve due to death, disability or other incapacity, a replacement arbitrator shall be chosen in accordance with the procedures
set forth in this Article for the original selection of the arbitrator. 

  

	G.	The panel shall make its decision considering the custom and practice of the applicable insurance and reinsurance business as promptly as possible following the
termination of the hearings. Judgment upon the award may be entered in any court having jurisdiction thereof. 

  

	H.	If more than one subscribing reinsurer is involved in arbitration where there are common questions of law or fact and a possibility of conflicting awards or
inconsistent results, all such subscribing 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 subscribing reinsurers constituting the one party; provided,
however, that nothing therein shall impair the rights of such subscribing reinsurers to assert several, rather than joint defenses or claims, nor be construed as changing the liability of the subscribing reinsurers under the terms of this Contract
from several to joint. 

  

					
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	I.	Each party shall bear the expense of its own arbitrator and shall jointly and equally bear with the other party the cost of the third arbitrator. The remaining costs of
the arbitration shall be allocated by the panel. The panel may, at its discretion, award such further costs and expenses as it considers appropriate, including but not limited to attorneys fees, to the extent permitted by law.

 ARTICLE XXXIV 
 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.) 
  

	A.	As regards Policies or bonds issued by the Company coming within the scope of this Contract, the Company agrees that when it shall file with the insurance regulatory
authority or set up on its books reserves for 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 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 per the Company’s statutory accounts, unearned premium and any positive Notional
Experience Account balance accrued by the Company, as shown in the statement prepared by the Company (hereinafter referred to as “subscribing reinsurer’s obligations”) by funds withheld, cash advances, qualified trust, or a Letter of
Credit. The subscribing reinsurer shall have the option of determining the method of funding provided it is acceptable to the insurance regulatory authorities having jurisdiction over the Company’s reserves. All costs associated with the method
of funding shall be borne solely by the Company. 

  

	B.	When funding by a Letter of Credit, the subscribing reinsurer agrees to apply for and secure timely delivery to the Company of a clean, irrevocable and unconditional
Letter of Credit issued by a bank and containing provisions acceptable to the insurance regulatory authorities having jurisdiction over the Company’s reserves in an amount equal to the subscribing reinsurer’s proportion of said reserves.
Such Letter of Credit shall be issued for a period of not less than one year, and shall be automatically extended for one year from its date of expiration or any future expiration date unless 30 days (60 days where required by insurance regulatory
authorities) prior to any expiration date the issuing bank shall notify the Company by certified or registered mail that the issuing bank elects not to consider the Letter of Credit extended for any additional period. 

  

					
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	C.	The subscribing reinsurer and Company agree that the Letters of Credit provided by the subscribing reinsurer pursuant to the provisions of this Contract may be drawn
upon at any time, notwithstanding any other provision of this Contract, and be utilized by the Company or any successor, by operation of law, of the Company including, without limitation, any liquidator, rehabilitator, receiver or conservator of the
Company for the following purposes, unless otherwise provided for in a separate Trust Agreement: 

  

	 	1.	To reimburse the Company for the subscribing reinsurer’s obligations, the payment of which is due under the terms of this Contract and which has not been otherwise
paid; 

  

	 	2.	To make refund of any sum which is in excess of the actual amount required to pay the subscribing reinsurer’s obligations under this Contract;

  

	 	3.	To fund an account with the Company for the subscribing reinsurer’s obligations. Such cash deposit shall be held in an interest bearing account separate from the
Company’s other assets, and interest thereon not in excess of the prime rate shall accrue to the benefit of the subscribing reinsurer; 

  

	 	4.	To pay the subscribing reinsurer’s share of any other amounts the Company claims are due under this Contract. 

In the event the amount drawn by the Company on any Letter of Credit is in excess of the actual amount required for subparagraph 1 or 3
or, in the case of subparagraph 4, the actual amount determined to be due, the Company shall promptly return to the subscribing reinsurer the excess amount so drawn. All of the foregoing shall be applied without diminution because of insolvency on
the part of the Company or the subscribing reinsurer. 
  

	D.	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. 

  

	E.	At quarterly intervals and immediately following each reinsurance premium payment, the Company shall prepare a specific statement of the subscribing reinsurer’s
obligations, for the sole purpose of amending the Letter of Credit as set forth in subparagraphs 1 and 2 below. For avoidance of doubt, the subscribing reinsurer’s obligation under this paragraph E shall include any positive balance of the
Notional Experience Account as calculated under the NOTIONAL EXPERIENCE ACCOUNT ARTICLE: 

  

	 	1.	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 Letter of Credit increasing the amount of credit by the amount of such difference. 

 

	 	2.	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 Letter of Credit reducing the amount of credit available by the amount of such excess credit.

  

					
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	F.	With regard to funding in whole or in part by any Trust Account, it is agreed that the subscribing Reinsurer shall enter into a trust agreement and establish a Trust
Account hereunder for the sole benefit of the Company with a trustee (“Trustee”). The Trustee and the trust agreement shall comply with all applicable requirements of regulatory authorities having jurisdiction over the Company.

  

	G.	The Reinsurer agrees that the assets deposited into the Trust Account shall consist only of currency of the United States of America, certificates of deposit issued by
a United States bank and payable in United States legal tender, and investments of the types specified in paragraphs (1), (2), (3), (8) and (10) of Section 1404(a) of the New York Insurance Law, provided such investments are issued by
an institution that is not the parent, subsidiary or affiliate of either the Grantor or the Beneficiary (“Authorized Investments”). 

  

	H.	The Reinsurer, prior to depositing assets with the Trustee, shall execute all assignments and endorsements in blank, and shall transfer legal title to the Trustee of
all shares, obligations or any other assets requiring assignments, in order that the Company, or the Trustee upon direction of the Company, may whenever necessary negotiate any such assets without consent or signature from the Reinsurer or any other
entity. 

  

	I.	The Reinsurer shall deposit in the Trust Account Authorized investments at least equal in value to one hundred percent (100%) of the Reinsurer’s Obligations
(less the value of the balance of credit available under any Letter(s) of Credit). 

  

	J.	At quarterly intervals and immediately following each reinsurance premium payment, the Company shall determine if the Trust Account is adequately funded with respect to
the Company’s liabilities reinsured under the Contract. If the Company determines that the fair market value of the Authorized Investments held in the Trust Account is less than one hundred percent (100%) of the Reinsurer’s
Obligations, the Company shall send the Reinsurer a notice specifying the amount of the inadequacy and the Reinsurer shall deposit such amount in the Trust Account within 30 days of receipt of such notice. 

 

	K.	All settlements of account under the Trust Agreement between the Company and Reinsurer shall be made in cash or its equivalent. 

 

	L.	The Reinsurer and the Company agree that the assets in the Trust Account may be withdrawn by the Company at any time, notwithstanding any other provisions in the
Contract, provided such assets are applied and utilized by the Company or any successor of the Company by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Company, without diminution
because of the insolvency of the Company or the Reinsurer, only for the following purposes: 

  

	 	1.	To reimburse the Company for the Reinsurer’s share of the Obligations paid by the Company under the terms and provisions of the reinsured policies;

  

					
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	 	2.	To fund an account specifically established by the Company in an amount at least equal to the deduction, for reinsurance ceded, from the Company’s liabilities
ceded under this Contract. Such amount shall include, but not be limited to, amounts for policy reserves, and reserves for claims and losses incurred (including losses incurred but not reported); and 

 

	 	3.	To pay any other amounts, consistent with the terms of this Contract, which the Company has calculated to be due to it. 

 

	M.	If and to the extent that the laws and regulations governing the Company’s right to obtain statutory financial statement credit for the reinsurance provided
pursuant to this Contract are amended such that the Reinsurer is no longer required to secure 100% of its share of the Obligations, the Company acknowledges and agrees that the Reinsurer’s obligation to provide such security shall immediately
and automatically be reduced to the extent permitted by such amended laws and regulations. 

 ARTICLE XXXV

 SERVICE OF SUIT 
 (This Article is applicable if the subscribing reinsurer is not domiciled in the United States of America and/or is not authorized in any State, Territory or District of the United States where
authorization is required by insurance regulatory authorities. This Article is not intended to conflict with or override the obligation of the parties to arbitrate their disputes in accordance with the ARBITRATION ARTICLE.) 

 

	A.	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, shall
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 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. The
subscribing reinsurer, once the appropriate court is selected, whether such court is the one originally chosen by the Company and accepted by subscribing reinsurer or is determined by removal, transfer, or otherwise, as provided for above, shall
comply with all requirements necessary to give said court jurisdiction and, in any suit instituted against any of them upon this Contract, and shall abide by the final decision of such court or of any appellate court in the event of an appeal.

  

	B.	Service of process in such suit may be made upon the agent for the service of process (“agent”) named below, depending on the jurisdiction where the Company
chooses to bring suit: 

  

	 	1.	 If the suit is brought in the State of California, the law firm of Mendes and Mount, 445 South Figueroa Street, 38th Floor, Los Angeles, California 90071 shall be authorized and
directed to accept service of process on behalf of the subscribing reinsurer in any such suit; 

  

					
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	 	2.	If the suit is brought in the State of New York, the law firm of Mendes and Mount, 750 Seventh Avenue, New York, New York 10019 shall be authorized and directed to
accept service of process on behalf of the subscribing reinsurer in any such suit; 

  

	 	3.	If the suit is brought in any state other than California or New York, either of the agents described in subparagraphs 1 or 2 above shall be authorized and directed to
accept service of process on behalf of the subscribing reinsurer in any such suit; or 

  

	 	4.	If the subscribing reinsurer has designated an agent in the subscribing reinsurer’s Interests and Liabilities Agreement attached hereto, then that agent shall be
authorized and directed to accept service of process on behalf of the subscribing reinsurer in any suit. However, if an agent is designated in the subscribing reinsurer’s Interests and Liabilities Agreement and the agent is not located in
California as respects a suit brought in California or New York as respects a suit brought in New York, in keeping with the laws of the states of California and New York which require that service be made on an agent located in the respective state
if a suit is brought in that state, the applicable office of Mendes and Mount stipulated in subparagraphs 1 and 2 above must be used for service of suit unless the provisions of paragraph C of this Article apply. 

 

	C.	Further, pursuant to any statute of any state, territory or district of the United States that makes provision therefor, the subscribing reinsurer hereby designates 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 its 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 Contract, and hereby designates the above-named as the person to whom the said officer is authorized to mail such process or a true copy
thereof. 

 ARTICLE XXXVI 
 MODE OF EXECUTION 
 This Contract may be executed either by an original written ink
signature of paper documents, by an exchange of facsimile copies showing the original written ink signature of paper documents, or by electronic signature by either party employing appropriate software technology as to satisfy the parties at the
time of execution that the version of the document agreed to by each party shall always be capable of authentication and satisfy the same rules of evidence as written signatures. The use of any one or a combination of these methods of execution
shall constitute a legally binding and valid signing of this Contract. This Contract may be executed in one or more counterparts, each of which, when duly executed, shall be deemed an original. 

  

					
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 ARTICLE XXXVII 
 ENTIRE AGREEMENT 
 This Contract shall constitute the entire agreement between the
parties with respect to the business being reinsured hereunder. There are no understandings between the parties other than as expressed in this Contract. Any change or modification to this Contract shall be null and void unless made by amendment to
this Contract and signed by both parties. This Article shall not be construed as limiting in any way the admissibility in the context of an arbitration or any other legal proceeding, evidence regarding the formation, interpretation, purpose or
intent of this Contract. 
 ARTICLE XXXVIII 
 INTERMEDIARY 
 Willis Re Inc., 15305 North Dallas Parkway, Suite 1100, Colonnade III,
Addison, Texas 75001 is hereby recognized as the intermediary negotiating this Contract and through whom all communications relating thereto shall be transmitted to the Company or the Reinsurer. However, all communications concerning accounts, claim
information, funds and inquiries related thereto shall be transmitted to the Company or the Reinsurer through Willis Re Inc., 5420 Millstream Road, Suite 200, McLeansville, North Carolina 27301. Payments by the Company to Willis Re Inc. shall be
deemed to constitute payment to the Reinsurer and payments by the Reinsurer to Willis Re Inc. shall be deemed to constitute payment to the Company only to the extent that such payments are actually received by the Company. 

IN WITNESS WHEREOF, the Company by its duly authorized representative has executed this Contract as of the date specified below: 

Signed this 21st day of December, 2011. 
 AMERICAN INTERSTATE INSURANCE COMPANY 
 AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS

			
	SILVER OAK CASUALTY, INC.
		
	By	 	/s/ Allan Farr
	Printed Name	 	Allan Farr
	Title	 	Senior Vice President - ERM

  

					
	 93948002-12 (1-1-12)
	 		 	
	 Second Casualty Excess of Loss Contract
	 	34	 	11-30-11

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

 (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 of 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 Liability
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, 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 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; 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 operation of a
nuclear facility by any person or organization. 

  

					
	 93948002-12 (1-1-12)
	 		 	
	 Second Casualty Excess of Loss Contract
	 	1	 	11-30-11

	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 damages 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. 
  

	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 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”

 (“property damage” includes all forms of radioactive contamination of property 

(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 operation 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 of the Independent Insurance Conference of Canada. 

 

	*	NOTE: The words printed in italics 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. 

 21/9/67 

N.M.A. 1590 
 BRMA 35A 

  

					
	 93948002-12 (1-1-12)
	 		 	
	 Second Casualty Excess of Loss Contract
	 	2	 	11-30-11INTEREST AND LIABILITIES AGREEMENT

 Exhibit 10.23 
 INTERESTS AND LIABILITIES AGREEMENT 
 (the “Agreement”) 

of 
 ALTERRA
BERMUDA LIMITED 
 (the “Subscribing Reinsurer”) 

with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 
 REINSURANCE CONTRACT 

(the “Contract”) 
 issued to 
 AMERICAN INTERSTATE INSURANCE COMPANY 

DeRidder, Louisiana 
 and 
 AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 

Austin, Texas 
 and 
 SILVER OAK CASUALTY, INC. 

DeRidder, Louisiana 
 and 
 any other insurance companies which are now or hereafter come under
the ownership, 
 control or management of Amerisafe Insurance Group 

(collectively the “Company”) 
 The Subscribing Reinsurer shall have a 5.00% share in the interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 

This Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time,
January 1, 2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several
and not joint with the share of any other subscribing reinsurer. In no event shall the Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 1 day of February, 2012. 
  

							
	ALTERRA BERMUDA LIMITED	 		 	

	By	 	/s/ Bill Yib	 		 
	Print Name	 	Bill Yib	 		 
	Title	 	SVP	 		 

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	 Casualty Catastrophe XOL - I&L
	 		 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 ARCH REINSURANCE COMPANY 

(the “Subscribing Reinsurer”) 
 with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 7.50% share in the
interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 12th day of January, 2012. 
  

							
	ARCH REINSURANCE COMPANY	 		 	
	By	 	/s/ Thomas G. Devine	 		 
	Print Name	 	Thomas G. Devine	 		 
	Title	 	Director - Casualty Clash	 		 

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	 Casualty Catastrophe XOL - I&L
	 		 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 CATLIN UNDERWRITING AGENCIES LIMITED (#2003) 

(the “Subscribing Reinsurer”) 
 with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which arc now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 10.00% share in
the interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 26th day of January, 2012. 
  

							
	CATLIN UNDERWRITING, INC.	 		 	
	on Behalf of CATLIN UNDERWRITING AGENCIES LIMITED (#2003)
				
	By	 	/s/ James J. D’erriw	 		 	
	Print Name	 	James J. D’erriw	 		 	
	Title	 	Senior Underwriter 	 		 	

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	 Casualty Catastrophe XOL - I&L
	 		 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 HANNOVER RUCKVERSICHERUNG AG 

(the “Subscribing Reinsurer”) 
 with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 7.50% share in the
interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1,2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 13th day of January, 2012. 
  

							
	HANNOVER RUCKVERSICHERUNG AG	 		 	 HANNOVER
RE®

HANNOVER RUCKVERSICHERUNG AG

				
	By	 	/s/ Carola von Heimburg	 		 	/s/ S. Peloso
	Print Name	 	Carola von Heimburg	 		 	S. Peloso
	Title	 	SVP	 		 	A.V.P

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	 Casualty Catastrophe XOL - I&L
	 		 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 LLOYDS UNDERWRITING SYNDICATE #5151 MRE 

(the “Subscribing Reinsurer”) 
 with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 7.50% share in the
interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 18th day of January, 2012 
  

							
	IOA RE	 		 	IOA Re on Behalf of
	on Behalf of SYNDICATE 5151 MRE AT LLOYDS	 		 	 Syndicate 5151 MRE at Lloyd’s

UNDER BINDING AUTHORITY

	By    	 	/s/ William Reichert	 		 	REFERENCE: 11126
	Print Name 	 	William Reichert	 		 	IOA Re REFERENCE:
	Title  	 	Vice President	 		 	69035

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	Casualty Catastrophe XOL - l&L	 		 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 MUNICH REINSURANCE AMERICA, INC. 

(the “Subscribing Reinsurer”) 
 with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 10.00% share in
the interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1,2012 and shall continue in force until 12:01 a.m., Standard Time, January 1,2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this January day of 20th, 2012. 
  

			
	MUNICH REINSURANCE AMERICA, INC.
		
	By	 	/s/ Michael Schummer
	Print Name	 	Michael Schummer
	Title	 	SVP

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	Casualty Catastrophe XOL - I&L	 		 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 TOKIO MILLENNIUM RE LTD. 

(the “Subscribing Reinsurer”) 
 with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 10.00% share in
the interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 24th day of January, 2012 
  

							
	TOKIO MILLENNIUM RE LTD.	 		 	

	By 	 	/s/ Mirek Wieczorek	 		 
	Print Name	 	Mirek Wieczorek	 		 
	Title	 	Senior Vice President	 		 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL - I&L
	 		 	

 Market Reform Contract — EXEMPT 

Client Requirement 
  

					
	WILLIS LIMITED	 		  	576 WIL
			
	Agreement Number	 	:	  	USX4990
			
	Reinsured	 	:	  	Amerisafe Insurance Group
			
	Type of Risk	 	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract
			
	Period	 	:	  	12 months commencing 1st January 2012
			
		 		  	The “Risk Details” section represents only a convenient summary of the Contractual Wording and is not itself contractually binding.

  

									
	 CLIENT SHORTNAME
  

WFNA
	  	 CLIENT REF./ CONTACT
 93948003-12
	  		  	
			
	 PREVIOUS REF.
  

URX4990
	  	CONTRACT DOCUMENT DATE	  	NO. OF DOCS UNDER SAME UMR
 
 One

	
	 CLIENT LONGNAME

 
 Willis Re Inc. Texas

			
	REINSURED LONGNAME	  	Amerisafe Insurance Group	  	
	
	 BROKERAGE ARRANGEMENTS / SHARING INCLUDING FEES /
SPECIAL INSTRUCTIONS
  
 15% Brokerage, Split
10% Willis Re Inc and 5% Willis London

					
	ACCOUNT EXECUTIVE	  	Graeme Meachem	  		  	EXTN.	  	17449
					
	SIGNED	  		  		  	DATE	  	
					
	2nd PAIR OF EYES SIGNED	  		  		  	DATE	  	
					
	LONDON TECHNICIAN	  	Nicky Bruce	  		  	EXTN.	  	17994
					
	RELATED CONTRACTS	  		  		  		  	
					
	 OP RESP CODE

 
 08494
	  	 WORDING
  

SWDG
	  		  		  	

  
 Willis
Limited, a Lloyd’s broker, authorised and regulated by the Financial Services Authority. 
 Registered office 51 Lime Street,
London EC3M 7DQ. Registered number 181116 England and Wales. 

 AMERICAN INTERSTATE INSURANCE COMPANY 

DeRidder, Louisiana 
 and 
 AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 

Austin, Texas 
 and 
 SILVER OAK CASUALTY, INC. 

DeRidder, Louisiana 
 and 
 any other insurance companies which are now or hereafter come under
the ownership, 
 control or management of Amerisafe Insurance Group 

CASUALTY CATASTROPHE EXCESS OF LOSS 
 REINSURANCE CONTRACT 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 		 	

  
 

 
  

					
	UMR	 	:	  	B0576USX4990 (93948003-12
	Reinsured	 	:	  	Amerisafe Insurance Group
	Type	 	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

 RISK DETAILS 

 

			
	REINSURED	  	Amerisafe Insurance Group
		
	TYPE	  	Casualty Catastrophe Excess of Loss Reinsurance Contract.
		
	PERIOD	  	This Contract will apply to all losses occurring during the period January 1, 2012, 12:01 a.m. Standard Time (as set forth in the Company’s polices), to January 1, 2013,
12:01 a.m. Standard Time.
		
	 TAXES PAYABLE
 BY
REINSURED
 AND ADMINISTERED BY REINSURERS
	  	None.
		
	 RECORDING, TRANSMITTING

AND STORING INFORMATION
	  	Where Willis Limited maintains risk and claim data / information / documents Willis Limited may hold data / information / documents electronically.
		
	REINSURER CONTRACT DOCUMENTATION	  	This contract document details the contract terms entered into by the Reinsurers and constitutes the contract document.
		
		  	The contract change document(s) signed by Reinsurers shall form the evidence of the changes agreed.
		
		  	Full contractual wording (93948003-12 [12-21-11]) is incorporated.

 The “Risk Details” section represents only a convenient summary of the Contractual Wording and is not itself
contractually binding. 

  

					
	NB/08-12-2011	  	Risk Details Page 1
			
		  	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EOM 7DQ. Registered Number 181116 England and Wales.
	  	

 TABLE OF CONTENTS 

 

							
	 ARTICLE
	 	 	  	PAGE	 
	I	 	BUSINESS COVERED	  	 	1	  
			
	II	 	TERM	  	 	2	  
			
	III	 	SPECIAL TERMINATION	  	 	2	  
			
	IV	 	DEFINITIONS	  	 	4	  
			
		 	        Act of Terrorism	  	 	4	  
			
		 	        Declaratory Judgment Expense	  	 	4	  
			
		 	        Extra Contractual Obligations/Loss in Excess of Policy Limits	  	 	4	  
			
		 	        Loss Adjustment Expense	  	 	5	  
			
		 	        Loss Occurrence	  	 	5	  
			
		 	        Net Earned Premium	  	 	6	  
			
		 	        Policy	  	 	6	  
			
	V	 	TERRITORY	  	 	6	  
			
	VI	 	EXCLUSIONS	  	 	6	  
			
	VII	 	TERRORISM ACT RECOVERIES	  	 	9	  
			
	VIII	 	COVERAGE	  	 	9	  
			
	IX	 	REINSTATEMENT	  	 	10	  
			
	X	 	SPECIAL ACCEPTANCE	  	 	10	  
			
	XI	 	ACCOUNTING BASIS	  	 	11	  
			
	XII	 	REINSURANCE PREMIUM	  	 	11	  
			
	XIII	 	NOTICE OF LOSS AND LOSS SETTLEMENTS	  	 	11	  
			
	XIV	 	LIABILITY OF REINSURERS	  	 	12	  
			
	XV	 	LATE PAYMENTS	  	 	13	  
			
	XVI	 	ANNUITIES AT THE COMPANY’S OPTION	  	 	14	  
			
	XVII	 	AGENCY AGREEMENT	  	 	14	  
			
	XVIII	 	SUBROGATION	  	 	14	  
			
	XIX	 	ERRORS AND OMISSIONS	  	 	14	  
			
	XX	 	OFFSET	  	 	15	  
			
	XXI	 	CURRENCY	  	 	15	  
			
	XXII	 	TAXES	  	 	15	  
			
	XXIII	 	FEDERAL EXCISE TAX	  	 	15	  
			
	XXIV	 	RESERVES AND FUNDING	  	 	16	  
			
	XXV	 	NET RETAINED LINES	  	 	17	  
			
	XXVI	 	THIRD PARTY RIGHTS	  	 	18	  
			
	XXVII	 	SEVERABILITY	  	 	18	  

  

					
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	XXVIII	 	GOVERNING LAW	  	 	18	  
			
	XXIX	 	INSPECTION OF RECORDS	  	 	18	  
			
	XXX	 	CONFIDENTIALITY	  	 	19	  
			
	XXXI	 	SUNSET AND COMMUTATION	  	 	20	  
			
	XXXII	 	INSOLVENCY	  	 	21	  
			
	XXXIII	 	ARBITRATION	  	 	22	  
			
	XXXIV	 	SERVICE OF SUIT	  	 	23	  
			
	XXXV	 	ENTIRE AGREEMENT	  	 	25	  
			
	XXXVI	 	MODE OF EXECUTION	  	 	25	  
			
	XXXVII	 	INTERMEDIARY	  	 	25	  
			
		 	Nuclear Incident Exclusion Clause - Liability - Reinsurance - U.S.A.	  			

  

					
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 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 between 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 and 

THE SUBSCRIBING REINSURER(S) EXECUTING THE 
 INTERESTS AND LIABILITIES AGREEMENT(S) 
 ATTACHED HERETO 

(the “Reinsurer”) 
 ARTICLE I 
 BUSINESS COVERED 

 

	A.	By this Contract the Reinsurer agrees to reinsure the excess liability of the Company under its Policies that are in force at the effective time and date hereof or
issued or renewed at or after that time and date, and classified by the Company as Workers’ Compensation, Employers Liability, including but not limited to coverage provided under the U.S. Longshore and Harbor Workers’ Compensation Act,
Jones Act, Outer Continental Shelf Lands Act and any other Federal Coverage extensions and General Liability business, subject to the terms, conditions and limitations hereafter set forth. 

 

	B.	The Reinsurer further agrees to reinsure the excess liability of the Company under Policies issued by Cooperative Mutual Insurance Company that are in force at the
effective time and date hereof or issued or renewed at or after that time and date, and classified by the Company as Workers’ Compensation, Employers Liability, including but not limited to coverage provided under the U.S. Longshore and Harbor
Workers’ Compensation Act, Jones Act, Outer Continental Shelf Lands Act and any other Federal Coverage extensions and General Liability business, subject to the terms, conditions and limitations hereafter set forth. 

  

					
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 ARTICLE II 
 TERM 
  

	A.	This Contract will apply to all losses occurring during the period January 1, 2012, 12:01 a.m. Standard Time (as set forth in the Company’s policies), to
January 1, 2013, 12:01 a.m. Standard Time. 

  

	B.	Upon the expiration or termination of this Contract, the entire liability of the Reinsurer for losses occurring subsequent to the date of expiration shall cease
concurrently with the date of expiration of this Contract. 

  

	C.	Notwithstanding the above, upon expiration or termination of this Contract, the Company shall have the option of requiring that the Reinsurer shall remain liable for
losses occurring under Policies in force on the expiration or termination date of this Contract until the next renewal, termination, or natural expiration date of such Policies or until 12 months (plus “odd time,” not to exceed 18 months
in all) following the date of expiration (whichever occurs first). 

  

	D.	If this Contract expires while a Loss Occurrence covered hereunder is in progress, the Reinsurer’s liability hereunder shall, subject to the other terms and
conditions of this Contract, be determined as if the entire Loss Occurrence had occurred prior to the expiration of this Contract, provided that no part of such Loss Occurrence is claimed against any renewal or replacement of this Contract.

 ARTICLE III 
 SPECIAL TERMINATION 
  

	A.	The Company may terminate a subscribing reinsurer’s share in this Contract by giving written notice to the subscribing reinsurer upon the happening of any one of
the following circumstances: 

  

	 	1.	A State Insurance Department or other legal authority orders the subscribing reinsurer to cease writing business, or 

 

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

  

	 	3.	For any period not exceeding 12 months which commences no earlier than 12 months prior to the inception of this Contract, the subscribing reinsurer’s
policyholders’ surplus, as reported in the financial statements of the subscribing reinsurer, has been reduced by 20.0% or more, or 

  

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

  

	 	5.	The subscribing reinsurer has reinsured its entire liability under this Contract without the Company’s prior written consent, or 

 

	 	6.	The subscribing reinsurer receives an A. M. Best rating of lower than A-, or an S&P financial strength rating of lower than A-, or 

 

	 	7.	The subscribing reinsurer has ceased writing new and renewal reinsurance for the lines of business covered hereunder. 

 

	B.	In the event of such termination, the liability of the subscribing reinsurer shall be terminated, at the Company’s option, either in accordance with the cutoff
provisions of paragraph B of the TERM ARTICLE or in accordance with the runoff provisions of paragraph C of the TERM ARTICLE, and such termination shall be effective as of the date the subscribing reinsurer receives written notice of termination
pursuant to paragraph A above. 

  

	C.	In the event the Company terminates a subscribing reinsurer’s share in this Contract under the provisions of this Article, the Company shall have the option to
commute the excess liabilities of the subscribing reinsurer. If this commutation option is exercised, the provisions of the paragraphs B through G of the SUNSET AND COMMUTATION ARTICLE shall apply. 

 

	D.	In the event the Company terminates a subscribing reinsurer’s share in this Contract under the provision of this Article, the Company shall have the option to
require the subscribing reinsurer to fund its share of ceded unearned premium, outstanding loss and Loss Adjustment Expense reserves, reserves for losses and Loss Adjustment Expense incurred but not reported to the Company (IBNR as determined by the
Company) and any other balances or financial obligations. Within 30 days of the Company’s written request to fund, the subscribing reinsurer shall provide to the Company a clean, unconditional, evergreen, irrevocable letter of credit or a trust
agreement which establishes a trust account for the benefit of the Company. The method of funding must be acceptable to the Company, shall be established with a financial institution suitable to the Company, shall comply with any applicable state or
federal laws or regulations involving the Company’s ability to recognize these agreements as assets or offsets to liabilities in such jurisdictions and shall be at the sole expense of the subscribing reinsurer. The Company and the subscribing
reinsurer may mutually agree on alternative methods of funding or the use of a combination of methods. This option is available to the Company at any time there remains any outstanding liabilities of the subscribing reinsurer. Notwithstanding the
foregoing, the Company shall not require funding in accordance with this subparagraph in the event the subscribing reinsurer has otherwise fully funded its obligations under this Contract in a manner acceptable to the Company.

  

					
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 ARTICLE IV 
 DEFINITIONS 
  

	A.	Act of Terrorism 

 “Act of
Terrorism” as used herein shall follow the definition provided under the Terrorism Risk Insurance Act of 2002 (TRIA) and as amended by the Terrorism Risk Insurance Extension Act of 2005 (TRIEA) and the Terrorism Risk Insurance Program
Reauthorization Act of 2007 (TRIPRA), together and including any extensions or replacement thereof, the “Terrorism Act.” 
  

	B.	Declaratory Judgment Expense 

“Declaratory Judgment Expense” as used herein shall mean all expenses incurred by the Company in connection with a declaratory
judgment action brought to determine the Company’s defense and/or indemnification obligations that are allocable to a specific claim subject to this Contract. Declaratory Judgment Expense shall be deemed to have been incurred on the date of the
original loss (if any) giving rise to the declaratory judgment action. 
  

	C.	Extra Contractual Obligations/Loss in Excess of Policy Limits 

  

	 	1.	Extra Contractual Obligations 

This Contract shall protect the Company for any “Extra Contractual Obligations” which as used herein shall mean any punitive,
exemplary, compensatory or consequential damages, other than Loss in Excess of Policy Limits, paid or payable by the Company as a result of an action against it by its insured, its insured’s assignee or a third party claimant, by reason of
alleged or actual negligence, fraud or bad faith on the part of the Company in handling a claim under a Policy subject to this Contract. 
 An Extra Contractual Obligation shall be deemed to have occurred on the same date as the loss covered or alleged to be covered under the Policy. 

 

	 	2.	Loss in Excess of Policy Limits 

This Contract shall protect the Company for any “Loss in Excess of Policy Limits” which as used herein shall mean an amount that
the Company would have been contractually liable to pay had it not been for the limit of the original Policy as a result of an action against it by its insured, its insured’s assignee or a third party claimant. Such loss in excess of the limit
shall have been incurred because of 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 its insured or in the preparation or prosecution of an appeal consequent upon such action. 

  

					
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	 	3.	This paragraph C shall not apply where an Extra Contractual Obligation and/or Loss in Excess of Policy Limits has been incurred due to an adjudicated finding of fraud
committed by a member of the Board of Directors or a corporate officer of the Company acting individually or collectively or in collusion with a member of the Board of Directors or a corporate officer or a partner of any other corporation or
partnership. 

  

	D.	Loss Adjustment Expense 

“Loss Adjustment Expense” as used herein shall mean all costs and expenses allocable to a specific claim that are incurred by
the Company in the investigation, appraisal, adjustment, settlement, litigation, defense or appeal of a specific claim, including court costs and costs of supersedeas and appeal bonds, and including 1) pre-judgment interest, unless included as part
of the award or judgment; 2) post-judgment interest; 3) legal expenses and costs incurred in connection with coverage questions and legal actions connected thereto, including Declaratory Judgment Expense; and 4) a pro rata share of salaries and
expenses of Company field employees, and expenses of other Company employees who have been temporarily diverted from their normal and customary duties and assigned to the field adjustment of losses covered by this Contract. Loss Adjustment Expense
does not include unallocated loss adjustment expense. Unallocated loss adjustment expense includes, but is not limited to, salaries and expenses of employees, other than (4) above, and office and other overhead expenses. 

 

	E.	Loss Occurrence 

 “Loss
Occurrence” as used in this Contract shall mean any one disaster or casualty or accident or loss or series of disasters or casualties or accidents or losses arising out of or caused by one event. The Company shall be the sole judge of what
constitutes one event as outlined herein and in the original Policy. 
  

	 	1.	As respects losses resulting from Occupational or Industrial Disease or Cumulative Trauma, each employee shall be considered a separate Loss Occurrence subject to the
following: 

 Losses resulting from Occupational or Industrial Disease or Cumulative Trauma suffered by employees
of an insured for which the employer is liable, as a result of a sudden and accidental event not exceeding 72 hours in duration, shall be considered one Loss Occurrence and may be combined with losses classified as other than Occupational or
Industrial Disease or Cumulative Trauma which arise out of the same event and the combination of such losses shall be considered as one Loss Occurrence within the meaning hereof. 

A loss with respect to each employee affected by an Occupational Disease or Cumulative Trauma shall be deemed to have been sustained by
the Company on the date of the beginning of the disability for which compensation is payable. 
 The terms “Occupational or
Industrial Disease” and “Cumulative Trauma” as used in this Contract shall be as defined by applicable statutes or regulations. 
  

	 	2.	As respects General Liability policies where the Company’s limit of liability for Products and Completed Operations coverages is determined on the basis of the
insured’s aggregate losses during a policy period, all such losses proceeding from or 

  

					
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traceable to the same causative agency shall, at the Company’s option, be deemed to have been caused by one occurrence commencing at the beginning of the policy period, it being understood
and agreed that each renewal or annual anniversary date of the policy involved shall be deemed the beginning of a new policy period. 

  

	F.	Net Earned Premium 

 “Net
Earned Premium” as used herein is defined as gross earned premium of the Company for the classes of business reinsured hereunder, less the earned portion of premiums ceded by the Company for reinsurance which inures to the benefit of this
Contract and less dividends paid or accrued. 
  

	G.	Policy 

 “Policy” or
“Policies” as used herein shall mean the Company’s or Cooperative Mutual Insurance Company’s binders, policies and contracts providing insurance or reinsurance on the classes of business covered under this Contract. 

 

	H.	Ultimate Net Loss 

“Ultimate Net Loss” shall mean the actual loss, including any pre-judgment interest which is included as part of the award or
judgment, “Second Injury Fund” assessments that can be allocated to specific claims, Loss Adjustment Expense, 90% of Loss in Excess of Policy Limits, and 90% of Extra Contractual Obligations, paid or to be paid by the Company on its net
retained liability after making deductions for all recoveries, subrogations and all claims on inuring reinsurance, whether collectible or not; provided, however, that in the event of the insolvency of the Company, payment by the Reinsurer shall be
made in accordance with the provisions of the INSOLVENCY ARTICLE. Nothing herein shall be construed to mean that losses under this Contract are not recoverable until the Company’s Ultimate Net Loss has been ascertained. 

Notwithstanding the definition of “Ultimate Net Loss” herein, the provisions of paragraph H of the COVERAGE ARTICLE as respects
the Minnesota Workers’ Compensation Reinsurance Association shall apply. 
 ARTICLE V 

TERRITORY 
 The territorial limits
of this Contract shall be identical with those of the Company’s Policies. 
 ARTICLE VI 

EXCLUSIONS 
  

	A.	This Contract does not apply to and specifically excludes the following: 

  

	 	1.	Reinsurance assumed by the Company under obligatory reinsurance agreements, except: 

 

	 	a.	Agency reinsurance where the policies involved are to be reunderwritten in accordance with the underwriting standards of the Company and reissued as Company policies at
the next anniversary or expiration date; and 

  

					
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	 	b.	Intercompany reinsurance between any of the reinsured companies under this Contract. 

 

	 	c.	Reinsurance assumed through Policies issued by Cooperative Mutual Insurance Company. 

 

	 	2.	Nuclear risks as defined in the “Nuclear Incident Exclusion Clause - Liability -Reinsurance - U.S.A.” (NMA 1590 21/9/67) attached hereto.

  

	 	3.	Liability as a member, subscriber or reinsurer of any Pool, Syndicate or Association, including Assigned Risk Plans or similar plans; however, this exclusion shall not
apply to liability under a Policy specifically designated to the Company from an Assigned Risk Plan or similar plan. 

  

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

  

	 	5.	Any “Act of Terrorism” involving the use of nuclear, chemical, biological or radiological devices. 

 

	 	6.	Business written to apply in excess of a deductible of more than $25,000, and business issued to apply specifically in excess over underlying insurance. However, if the
Company is required, by any state regulation, to provide a deductible of more than $25,000, this exclusion shall not apply. 

  

	 	7.	Workers’ Compensation where the principal exposure, as defined by the governing class code, is: 

 

	 	a.	Operation of aircraft, but only if the annual estimated policy premium is $250,000 or more; 

 

	 	b.	Operation of Railroads, subways or street railways; 

  

	 	c.	Manufacturing, assembly, packing or processing of fireworks, fuses, nitroglycerine, magnesium, pyroxylin, ammunition or explosives. This exclusion does not apply to the
assembly, packing or processing of explosives when the estimated annual premium is under $250,000 and does not apply to the commercial use of explosives; 

  

	 	d.	Underground mining. 

  

					
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	 	8.	As respects General Liability policies, exposures other than those identified below, as included in the General Liability section of the Company’s Commercial Lines
Manual: 

  

	 	a.	Class 97111 – Logging; 

  

	 	b.	Class 58873 – Sawmill; 

  

	 	c.	Class 59984 – Woodyard and Drivers; 

  

	 	d.	Class 95410 – Grading of Land; 

  

	 	e.	Class 45819 – LumberYard; 

  

	 	f.	Class 10073 – Repair Shops and Drivers; 

  

	 	g.	Class 43822 – Timber Cruiser; 

  

	 	h.	Class 99793 – Truckmen Not Otherwise Classified; 

  

	 	i.	Class 91591 – Contractors – Subcontracted Work Other Than Construction; 

 

	 	j.	Class 49452 – Vacant Land. 

  

	B.	Notwithstanding the foregoing, insureds regularly engaged in operations not excluded under paragraph A above, but whose operations may include one or more perils
excluded therein, shall not be excluded from coverage afforded by this Contract, provided said operations are incidental to the main operations of the insured. Notwithstanding the foregoing, coverage extended under this paragraph for incidental
operations of an insured shall not apply to exposures excluded under subparagraphs 1 though 5 of paragraph A above. The Company shall be the judge of what constitutes an incidental part of the insured’s operation. 

 

	C.	Except for subparagraphs 1 through 5 of paragraph A above, if the Company is inadvertently bound or is unknowingly exposed (due to error or automatic provisions of
policy coverage) on a risk otherwise excluded in paragraph A above, such exclusion shall be waived. The duration of said waiver will not extend beyond the time that notice of such coverage has been received by a responsible underwriting authority of
the Company and for a period not exceeding 30 days thereafter, or such longer period required to conform with any notice of cancellation provisions prescribed by regulatory authorities, such period not to exceed 12 months plus odd time (not
exceeding 18 months). 

  

	D.	If the Company is required to accept an assigned risk which conflicts with one or more of the exclusions set forth in subparagraph 6 of paragraph A, reinsurance shall
apply, but only for the difference between the Company’s retention and the limit required by the applicable state statute, and in no event shall the Reinsurer’s liability exceed the limit set forth in the Coverage Article.

  

	E.	Notwithstanding the foregoing, any reinsurance falling within the scope of one or more of the exclusions set forth above that is specially accepted by the Reinsurer
from the Company shall be covered under this Contract and be subject to the terms hereof. 

  

	F.	Except for subparagraphs 1 through 5 of paragraph A above, should a court of competent jurisdiction invalidate any exclusion or expand coverage of the original Policy
of the Company, any amount of Loss for which the Company would not be liable, except for such invalidation or expansion of coverage, shall not be subject to any of the exclusions, conditions and limitations hereinafter set forth under this Contract.

  

					
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 ARTICLE VII 
 TERRORISM ACT RECOVERIES 
  

	A.	Any financial assistance the Company receives under the Terrorism Act, shall apply as follows: 

 

	 	1.	Except as provided in subparagraph 2 below, any such financial assistance shall inure solely to the benefit of the Company and shall be entirely disregarded in applying
all of the provisions of this Contract. 

  

	 	2.	If losses occurring hereunder result in recoveries made by the Company both under this Contract and under the Terrorism Act, and such recoveries, together with any
other reinsurance recoverables made by the Company applicable to said losses, exceed the total amount of the Company’s insured losses, any amount in excess thereof shall reduce the Ultimate Net Loss subject to this Contract for the losses to
which the Terrorism Act assistance applies. These recoveries shall be returned in proportion to each Reinsurer’s paid share of the loss. 

  

	B.	Nothing herein shall be construed to mean that the losses under this Contract are not recoverable until the Company has received financial assistance under the
Terrorism Act. 

 ARTICLE VIII 
 COVERAGE 
  

	A.	The Reinsurer shall be liable for the Ultimate Net Loss in excess of $10,000,000 as a result of any one Loss Occurrence. The Reinsurer’s liability in respect of
any one Loss Occurrence shall not exceed $40,000,000. 

  

	B.	The Reinsurer’s liability in respect of Ultimate Net Loss amounts recoverable hereunder for an Act of Terrorism (as defined in the definition of “Act of
Terrorism”) occurring during the term of this Contract shall not exceed $40,000,000. This paragraph is not subject the REINSTATEMENT ARTICLE. 

  

	C.	The Reinsurer’s liability in respect of all losses occurring during the term of this Contract shall not exceed $80,000,000. 

 

	D.	As respects the statutory portion of any Workers’ Compensation Policy, the Company’s Ultimate Net Loss subject to this Contract shall not exceed $10,000,000
as respects any one life, each Loss Occurrence 

  

	E.	The Company shall be permitted to purchase (or maintain) other reinsurance which inures to the benefit of this Contract. 

 

	F.	The Company shall be permitted to carry underlying reinsurance, recoveries under which shall inure solely to the benefit of the Company and be entirely disregarded in
applying all of the provisions of this Contract. 

  

					
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	G.	As respects Employers Liability and General Liability, the maximum net subject Policy limit (except statutory where required by law) as respects any one Policy shall be
$2,000,000 or the Company shall be deemed to have purchased inuring excess facultative reinsurance for subject Policy limits in excess of $2,000,000. 

  

	H.	The Company shall be permitted to carry excess of loss reinsurance applying to Workers’ Compensation risks in the State of Minnesota, actual recoveries under which
shall inure to the benefit of this Contract. Such coverage shall be provided through the Minnesota Workers’ Compensation Reinsurance Association. Notwithstanding the treatment of inuring coverage in the definition of Ultimate Net Loss, the
liability of the Reinsurer for Minnesota Workers’ Compensation risks is not released. 

 ARTICLE IX

 REINSTATEMENT 
  

	A.	Should all or any part of the Reinsurer’s limit of liability be exhausted as a result of a Loss Occurrence, the sum so exhausted shall be reinstated from the date
the Loss Occurrence commenced. 

  

	B.	For each amount so reinstated, the Company agrees to pay an additional premium at the time of the Reinsurer’s payment of the loss calculated in accordance with the
following formula: 

  

	 	1.	The percentage of the Reinsurer’s limit of liability exhausted for the Loss Occurrence; times 

 

	 	2.	The Net Earned Premium for the term of this Contract (exclusive of reinstatement premium). 

The dollar amount resulting from the multiplication of subparagraphs 1 and 2 above shall equal the reinstatement premium. If at the time
of the Reinsurer’s payment of a loss hereon, the reinsurance premium as calculated under this Contract is unknown, the calculation of the reinstatement premium shall be based upon the deposit premium subject to adjustment when the reinsurance
premium is finally established. 
  

	C.	Nevertheless, the Reinsurer’s liability hereunder shall not exceed $40,000,000 in respect of any one Loss Occurrence, and shall be further limited to $80,000,000
in respect of all losses occurring during the term of this Contract. 

 ARTICLE X 

SPECIAL ACCEPTANCE 
 From time to
time the Company may request a special acceptance applicable to this Contract. For purposes of this Contract, in the event each subscribing reinsurer whose share in the interests and liabilities of the Reinsurer is 20% or greater agree to a special
acceptance, such agreement shall be binding on all subscribing reinsurers. If such agreement is not achieved, such special 

  

					
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acceptance shall be made to this Contract only with respect to the interests and liabilities of each subscribing reinsurer who agrees to the special acceptance. Should denial for special
acceptance not be received within 10 working days of said request, the special acceptance shall be deemed automatically agreed. In the event a reinsurer becomes a party to this Contract subsequent to one or more special acceptances hereunder, the
new reinsurer shall automatically accept such special acceptance(s) as being covered hereunder. 
 ARTICLE XI

 ACCOUNTING BASIS 
 All
premiums and losses under this Contract shall be reported on an “accident year” accounting basis. Unless specified otherwise herein, all premiums shall be credited to the period during which they earn, and all losses shall be charged to
the period during which they occur. 
 ARTICLE XII 
 REINSURANCE PREMIUM 
  

	A.	As premium for the reinsurance provided hereunder, the Company shall pay the Reinsurer 0.4642% times its Net Earned Premium for the term of this Contract subject to a
Minimum Premium of $1,056,000. 

  

	B.	The Company shall pay the Reinsurer a Deposit Premium of $1,320,000 payable in quarterly installments on January 1, April 1, July 1 and
October 1. 

  

	C.	Within 90 days after the expiration of this Contract, the Company shall provide a report to the Reinsurer setting forth the premium due hereunder, computed in
accordance with paragraph A, and if the premium so computed is greater than the previously paid Deposit Premium, the balance shall be remitted by the Company with its report. 

 

	D.	If this Contract expires on a runoff basis, the Company shall pay to the Reinsurer a premium for the runoff period equal to the expiring rate times its Net Earned
Premium for the runoff period. The runoff premium shall be calculated and paid within 90 days after the end of each three-month period during the runoff period. There shall be no minimum premium requirement for the runoff period.

 ARTICLE XIII 
 NOTICE OF LOSS AND LOSS SETTLEMENTS 
  

	A.	As soon as practicable, the Company shall advise the Reinsurer of all bodily injury claims or losses involving any of the following: 

 

	 	1.	Any claim or loss reserved at 50.0% or more of the Company’s retention under this Contract. 

  

					
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	 	2.	Any claim involving any of the following injuries where the Company’s incurred loss is greater than or equal to $1,000,000: 

 

	 	a.	Fatality. 

  

	 	b.	Spinal cord injuries (e.g., quadriplegia, paraplegia). 

  

	 	c.	Brain damage (e.g., seizure, coma or physical/mental impairment). 

  

	 	d.	Severe burn injuries resulting in disfigurement or scarring. 

  

	 	e.	Total or partial blindness in one or both eyes. 

  

	 	f.	Major organ (e.g., heart, lungs). 

  

	 	g.	Amputation of a limb or multiple fractures. 

  

	B.	The Company shall also advise the Reinsurer promptly of all losses which, in the opinion of the Company, may result in a claim hereunder and of all subsequent
developments thereto which, in the opinion of the Company, may materially affect the position of the Reinsurer. 

  

	C.	When so requested in writing, the Company shall afford the Reinsurer or its representatives an opportunity to be associated with the Company, at the expense of the
Reinsurer, in the defense of any claim, suit or proceeding involving this reinsurance, and the Company and the Reinsurer shall cooperate in every respect in the defense of such claim, suit or proceeding. 

 

	D.	All loss settlements made by the Company that are within the terms and conditions of this Contract (including but not limited to ex gratia payments) shall be binding
upon the Reinsurer. Upon receipt of satisfactory proof of loss, the Reinsurer agrees to promptly pay or allow, as the case may be, its share of each such settlement in accordance with this Contract. 

ARTICLE XIV 

LIABILITY OF REINSURERS 
 All
reinsurances for which the Reinsurer shall be liable by virtue of this Contract shall be subject in all respects to the same rates, terms, conditions, interpretations and waivers and to the same modifications, alterations, and cancellations, as the
respective policies to which such reinsurances relate, the true intent of the parties to this Contract being that the Reinsurer shall follow the fortunes of the Company. 

  

					
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 ARTICLE XV 
 LATE PAYMENTS 
  

	A.	In the event any premium, loss or other payment due either party is not received by the Intermediary hereunder by the payment due date, the party to whom payment is due
may, by notifying the Intermediary in writing, require the debtor party to pay, and the debtor party agrees to pay, an interest penalty on the amount past due calculated for each such payment on the last business day of each month as follows:

  

	 	1.	The number of full days which have expired since the due date or the last monthly calculation, whichever the lesser; times 

 

	 	2.	l/365ths of a rate equal to the 90-day Treasury Bill rate as published in The Wall Street Journal on the first business day following the date a remittance
becomes due; times 

  

	 	3.	The amount past due, including accrued interest. 

 It is agreed that interest shall accumulate until payment of the original amount due plus interest penalties have been received by the Intermediary. 

 

	B.	The establishment of the due date shall, for purposes of this Article, be determined as follows: 

 

	 	1.	As respects the payment of deposits and premiums due the Reinsurer, the due date shall be as provided for in the applicable section of this Contract.

  

	 	2.	Any claim or loss payment due the Company hereunder shall be deemed due 10 business days after the proof of loss or demand for payment is transmitted to the Reinsurer.
If such loss or claim payment is not received within the 10 days, interest will accrue on the payment or amount overdue in accordance with the interest penalty calculation above, from the date the proof of loss or demand for payment was transmitted
to the Reinsurer. 

  

	 	3.	As respects any payment, adjustment or return due either party not otherwise provided for in subparagraphs 1 and 2 of this paragraph, the due date shall be as provided
for in the applicable section of this Contract. 

  

	C.	For purposes of interest calculation only, amounts due hereunder shall be deemed paid upon receipt by the Intermediary. The validity of any claim or payment may be
contested under the provisions of this Contract. If the debtor party prevails in an arbitration, or any other proceeding, there shall be no interest penalty due. Otherwise, any interest will be calculated and due as outlined above.

  

	D.	Interest penalties arising out of the application of this Article that are $100 or less from any party shall be waived unless there is a pattern of late payments
consisting of three or more items over the course of any 12-month period. 

  

					
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 ARTICLE XVI 
 ANNUITIES AT THE COMPANY’S OPTION 
  

	A.	Whenever the Company is required, or elects, to purchase an annuity or to negotiate a structured settlement, either in satisfaction of a judgment or in an out-of-court
settlement or otherwise, the cost of the annuity or the structured settlement, as the case may be, shall be deemed part of the Company’s Ultimate Net Loss. 

 

	B.	The terms “annuity” or “structured settlement” shall be understood to mean any insurance policy, lump sum payment, agreement or device of whatever
nature resulting in the payment of a lump sum by the Company in settlement of any or all future liabilities which may attach to it as a result of an occurrence. 

 

	C.	In the event the Company purchases an annuity which inures in whole or in part to the benefit of the Reinsurer, it is understood that the liability of the Reinsurer is
not released thereby. In the event the Company is required to provide benefits not provided by the annuity for whatever reason, the Reinsurer shall pay its share of any loss. 

ARTICLE XVII 

AGENCY AGREEMENT 
 If more than
one reinsured company is named as a party to this Contract, the first named company will be deemed the agent of the other reinsured companies for purposes of sending or receiving notices required by the terms and conditions of this Contract and for
purposes of remitting or receiving any monies due any party. 
 ARTICLE XVIII 

SUBROGATION 
 The Reinsurer shall
be credited with subrogation recoveries (i.e., reimbursement obtained or recovery made by the Company, less Loss Adjustment Expense incurred in obtaining such reimbursement or making such recovery) on account of claims and settlements involving
reinsurance hereunder. Subrogation recoveries thereon shall always be used to reimburse the excess carriers in the reverse order of their priority according to their participation before being used in any way to reimburse the Company for its primary
loss. The Company, at its sole option and discretion, may enforce its rights to subrogation relating to any loss, a part of which loss was sustained by the Reinsurer, and may prosecute all claims arising out of such rights. 

ARTICLE XIX 

ERRORS AND OMISSIONS 
 Any
inadvertent delay, omission or error shall not be held to relieve either party hereto from any liability which would attach to it hereunder if such delay, omission or error had not been made, provided such omission or error is rectified upon
discovery. 

  

					
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 ARTICLE XX 
 OFFSET 
 The Company and the Reinsurer may offset any balance or amount due from one
party to the other under this Contract or any other contract heretofore or hereafter entered into between the Company and the Reinsurer, whether acting as assuming reinsurer or ceding company. The party asserting the right of offset may exercise
such right any time whether the balances due are on account of premiums or losses or otherwise. 
 ARTICLE XXI

 CURRENCY 
  

	A.	Whenever the word “Dollars” or the “$” sign appears in this Contract, they shall be construed to mean United States Dollars and all transactions
under this Contract shall be in United States Dollars. 

  

	B.	Amounts paid or received by the Company in any other currency shall be converted to United States Dollars at the rate of exchange at the date such transaction is
entered on the books of the Company. 

 ARTICLE XXII 

TAXES 
 In consideration of the
terms under which this Contract is issued, the Company will not claim a deduction in respect of the premium hereon when making tax returns, other than income or profits tax returns, to any state or territory of the United States of America, the
District of Columbia or Canada. 
 ARTICLE XXIII 
 FEDERAL EXCISE TAX 
 (Applicable to those subscribing reinsurers who are domiciled
outside the United States of America, excepting subscribing reinsurers exempt from Federal Excise Tax.) 
  

	A.	The subscribing reinsurer has agreed to allow for the purpose of paying the Federal Excise Tax the applicable percentage of the premium payable hereon (as imposed under
Section 4371 of the Internal Revenue Code) to the extent such premium is subject to the Federal Excise Tax. 

  

	B.	In the event of any return of premium becoming due hereunder the subscribing reinsurer will deduct the applicable percentage from the return premium payable hereon and
the Company or its agent should take steps to recover the tax from the United States Government. 

  

					
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 ARTICLE XXIV 
 RESERVES AND FUNDING 
  

	A.	A subscribing reinsurer will provide funding under the terms of this Article only if the Company will be denied statutory credit for reinsurance ceded to that
subscribing reinsurer pursuant to the credit for reinsurance law or regulations in any applicable jurisdiction. In the event any of the provisions of this Article conflict with or otherwise fail to satisfy the requirements of the appropriate credit
for reinsurance statute or regulation, this Article will be deemed amended to conform to the appropriate statute or regulation; the intent of this Article being that the Company will be permitted to realize full credit for the reinsurance ceded to
the Reinsurer under this Contract. 

  

	B.	As regards Policies or bonds issued by the Company coming within the scope of this Contract, the Company agrees that when it shall file with the insurance regulatory
authority or set up on its books reserves for 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 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 shown in the statement prepared by the Company (hereinafter referred to as
“subscribing reinsurer’s obligations”) by funds withheld, cash advances or a Letter of Credit. The subscribing reinsurer shall have the option of determining the method of funding provided it is acceptable to the Company and to the
insurance regulatory authorities having jurisdiction over the Company’s reserves. 

  

	C.	When funding by a Letter of Credit, the subscribing reinsurer agrees to apply for and secure timely delivery to the Company of a clean, irrevocable and unconditional
Letter of Credit issued by a bank and containing provisions acceptable to the insurance regulatory authorities having jurisdiction over the Company’s reserves in an amount equal to the subscribing reinsurer’s proportion of said reserves.
Such Letter of Credit shall be issued for a period of not less than one year, and shall be automatically extended for one year from its date of expiration or any future expiration date unless 30 days (60 days where required by insurance regulatory
authorities) prior to any expiration date the issuing bank shall notify the Company by certified or registered mail that the issuing bank elects not to consider the Letter of Credit extended for any additional period. 

 

	D.	The subscribing reinsurer and Company agree that the Letters of Credit provided by the subscribing reinsurer pursuant to the provisions of this Contract may be drawn
upon at any time, notwithstanding any other provision of this Contract, and be utilized by the Company or any successor, by operation of law, of the Company including, without limitation, any liquidator, rehabilitater, receiver or conservator of the
Company for the following purposes, unless otherwise provided for in a separate Trust Agreement: 

  

	 	1.	To reimburse the Company for the subscribing reinsurer’s obligations, the payment of which is due under the terms of this Contract and which has not been otherwise
paid; 

  

					
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	 	2.	To make refund of any sum which is in excess of the actual amount required to pay the subscribing reinsurer’s obligations under this Contract;

  

	 	3.	To fund an account with the Company for the subscribing reinsurer’s obligations. Such cash deposit shall be held in an interest bearing account separate from the
Company’s other assets, and interest thereon not in excess of the prime rate shall accrue to the benefit of the subscribing reinsurer; 

  

	 	4.	To pay the subscribing reinsurer’s share of any other amounts the Company claims are due under this Contract. 

In the event the amount drawn by the Company on any Letter of Credit is in excess of the actual amount required for subparagraph 1 or 3,
or in the case of subparagraph 4, the actual amount determined to be due, the Company shall promptly return to the subscribing reinsurer the excess amount so drawn. All of the foregoing shall be applied without diminution because of insolvency on
the part of the Company or the subscribing reinsurer. 
  

	E.	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. 

  

	F.	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 Letter of Credit, in the following manner: 

  

	 	1.	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 Letter of Credit increasing the amount of credit by the amount of such difference. 

 

	 	2.	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 Letter of Credit reducing the amount of credit available by the amount of such excess credit.

 ARTICLE XXV 
 NET RETAINED LINES 
  

	A.	This Contract applies only to that portion of any Policy which the Company retains net for its own account (prior to deduction of any underlying reinsurance
specifically permitted in this Contract), and in calculating the amount of any loss hereunder and also in computing the amount or amounts in excess of which this Contract attaches, only loss or losses in respect of that portion of any Policy which
the Company retains net for its own account shall be included. 

  

					
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	B.	The amount of the Reinsurer’s liability hereunder in respect of any loss or losses shall not be increased by reason of the inability of the Company to collect from
any other reinsurer(s), whether specific or general, any amounts which may have become due from such reinsurer(s), whether such inability arises from the insolvency of such other reinsurer(s) or otherwise. 

ARTICLE XXVI 

THIRD PARTY RIGHTS 
 This Contract
is solely between the Company and the Reinsurer, and in no instance shall any other party have any rights under this Contract except as expressly provided otherwise in the INSOLVENCY ARTICLE. 

ARTICLE XXVII 

SEVERABILITY 
 If any provision of
this Contract shall be rendered illegal or unenforceable by the laws or regulations 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 Contract
or the enforceability of such provision in any other jurisdiction. 
 ARTICLE XXVIII 

GOVERNING LAW 
 This Contract
shall be governed as to performance, administration and interpretation by the laws of the State of Louisiana, exclusive of that state’s rules with respect to conflicts of law, except as to rules with respect to credit for reinsurance in which
case the applicable rules of all states shall apply. 
 ARTICLE XXIX 

INSPECTION OF RECORDS 
  

	A.	The Reinsurer or its designated representative(s) approved by the Company, upon providing reasonable advance notice to the Company, shall have access at the offices of
the Company or at a location to be mutually agreed, at a time to be mutually agreed, to inspect the Company’s underwriting, accounting, or claim files pertaining to the subject matter of this Contract. The Company shall determine the manner in
which files shall be accessed by the Reinsurer. The Reinsurer may, at its own expense, reasonably request copies of such files and agrees to pay the Company’s reasonable costs incurred in procuring such copies. 

 

	B.	If any undisputed amounts are overdue from the Reinsurer to the Company, the Reinsurer shall have access to such records only upon payment of all such overdue amounts.

  

					
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	C.	If the Reinsurer makes any inspection of the Company’s books and records involving specific claims under this Contract and, as a result of the inspection the claim
is contested or disputed, the Reinsurer shall provide the Company, at the Company’s request, a summary of any reports, other than proprietary information or privileged communications, completed by the Reinsurer’s personnel or by third
parties on behalf of the Reinsurer outlining the reasons for contesting or disputing the subject claim. 

ARTICLE XXX 

CONFIDENTIALITY 
  

	A.	The Reinsurer hereby acknowledges that the documents, information, and data provided to the Reinsurer by the Company, whether directly or through an authorized agent,
in connection with the placement and execution of this Contract (“Confidential Information”) are proprietary and confidential to the Company. 

  

	B.	Absent the written consent of the Company, the Reinsurer will not disclose any Confidential Information to any third parties, except when: 

 

	 	1.	The disclosure is to professional advisors or to authorized agents of the Reinsurer performing underwriting, claim handling, pricing, placement and/or evaluation
services for the Reinsurer; or 

  

	 	2.	The Confidential Information is publicly known or has become publicly known through no unauthorized act of the Reinsurer; or 

 

	 	3.	Required by retrocessionaires subject to the business ceded to this Contract; or 

 

	 	4.	Required by state regulators performing an audit of the Reinsurer’s records and/or financial condition; or 

 

	 	5.	Required by auditors performing an audit of the Reinsurer’s records in the normal course of business. 

 

	C.	Further, the Reinsurer agrees not to use any Confidential Information for any purpose not permitted by this Contract or not related to the performance of their
obligations or enforcement of their rights under this Contract. 

  

	D.	Notwithstanding the above, in the event that the Reinsurer is required by court order, other legal process, or any regulatory authority to release or disclose any or
all of the Confidential Information, the Reinsurer agrees to provide the Company by written or electronic mail, reasonable advance notice of same prior to such release or disclosure and to use their reasonable best efforts to assist the Company in
maintaining the confidentiality provided for in this Article. 

  

	E.	The provisions of this Article will extend to the officers, directors, shareholders, and employees of the Reinsurer and its affiliates, who have received Confidential
Information in accordance with this Contract and will be binding upon their successors and assigns. 

  

					
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 ARTICLE XXXI 
 SUNSET AND COMMUTATION 
  

	A.	Ten years after the expiration of this Contract, the Company shall advise the Reinsurer of any Loss Occurrences attaching to this Contract which have not been finally
settled and which may result in a claim by the Company under this Contract. No liability shall attach hereunder for any claim or claims not reported to the Reinsurer within this ten year period. If a loss arising out of a Loss Occurrence is reported
during this period, all losses arising out of the same Loss Occurrence shall be deemed reported under this paragraph regardless of when notification of loss is provided. 

 

	B.	If both parties agree to commute the unsettled losses subject to the Contract, then the Reinsurer’s liability for all such unsettled losses shall then be commuted.

  

	C.	It is understood that commutation of all such losses shall be made using tabular reserving methods. For each loss, the nominal ultimate value of the Company’s
Ultimate Net Loss shall be established by projecting out future medical and indemnity payments and loss expenses by year based on appropriate trends and escalations applied to annual cost estimates. The Contract limit and retention (where
applicable) shall then be applied to the nominal ultimate value of the Company’s Ultimate Net Loss to determine the nominal ultimate Contract loss. Mortality factors and discount factors shall then be applied by year to the nominal ultimate
Contract loss. The discounted, mortality adjusted projected annual loss payments shall be summed to determine the present value (“commutation price”) of the ultimate Contract loss. The medical escalation, discount and mortality factors are
described in paragraph C. 

  

	D.	The following factors shall be utilized in establishing the commutation price: 

 

	 	1.	Medical Escalation Rate 

 The
medical escalation rate shall be a reasonable estimate of future medical inflation. 
  

	 	2.	Discount Rate 

 The discount rate
shall be the annualized 10-year US Treasury Bill rate at the Valuation Date. 
  

	 	3.	Mortality Tables 

 Mortality
factors shall be based on the most recent mortality table at the Valuation Date from the “Vital Statistics of the United States” as published by the US Department of Health and Human Services, Center for Disease Control and Prevention.
Factors for extension beyond age 85 shall also be included. 

  

					
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	 	4.	Impairment 

 Impairment factors
shall be based on the individual claim characteristics. 
 Any other method of calculating the commutation price of one or more
losses subject to this Contract may be used as mutually agreed between the Company and the Reinsurer. 
  

	E.	If the Company and the Reinsurer cannot agree on a commutation value, the effort can be abandoned. Alternatively, the Company and the Reinsurer may mutually agree to
settle any difference using a panel of three actuaries, one to be chosen by each party and the third by the two so chosen. If either party refuses or neglects to appoint an actuary within 30 days, the other party may appoint two actuaries. If the
two actuaries fail to agree on the selection of a third actuary within 30 days of their appointment, each of them shall name two, of whom the other shall decline one and the decision shall be made by drawing lots. All the actuaries shall be
regularly engaged in the valuation of Workers’ Compensation claims and shall be Fellows of the Casualty Actuarial Society or members of the American Academy of Actuaries. All of the actuaries shall be independent of either party to this
Contract. 

  

	F.	The settlement agreed upon by a majority of the panel of actuaries shall be final and binding on both parties and set forth in a sworn written document expressing their
professional opinion that said value is fair for the complete mutual release of all liabilities in respect of such reserves. 

  

	G.	The Reinsurer’s commutation payment shall be due within 7 days following the date the Company and the Reinsurer agree to the commutation price. Such payment by the
Reinsurer shall constitute both a complete release of the Reinsurer of its liability for all losses, known or unknown, under this Contract, and a complete release of the Company of its liabilities and obligations, known or unknown, under this
Contract. 

  

	H.	This Article shall survive the expiration of this Contract. 

 ARTICLE XXXII 
 INSOLVENCY 

 

	A.	In the event of the insolvency of the Company, this reinsurance shall be payable directly to the Company or to its liquidator, receiver, conservator or statutory
successor, with reasonable provision for verification, on the basis of the liability of the Company without diminution because of the insolvency of the Company or because the liquidator, receiver, conservator or statutory successor of the Company
has failed to pay all or a portion of any claim. It is agreed, however, that the liquidator, receiver, conservator or statutory successor of the Company shall give written notice to the Reinsurer of the pendency of a claim against the Company
indicating the Policy or bond reinsured which claim would involve a possible liability on the part of the Reinsurer within a reasonable time after such claim is filed in the conservation or liquidation proceeding or in the receivership, and that
during the pendency of such claim, the 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 that it may deem available to the Company or its
liquidator, receiver, conservator or statutory successor. The expense thus incurred by the Reinsurer shall be chargeable, subject to the approval of the Court, against the Company as part of the expense of conservation or 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 Reinsurer. 

  

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

  

	C.	It is further agreed that, in the event of the insolvency of the Company, the reinsurance under this Contract shall be payable directly by the Reinsurer to the Company
or its liquidator, receiver, conservator, or statutory successor, except as provided by Section 4118(a) of the New York Insurance Law or except 1) where this Contract specifically provides another payee of such reinsurance in the event of the
insolvency of the Company or 2) where the Reinsurer with the consent of the direct insured or insureds has assumed such Policy obligations of the Company as direct obligations of the Reinsurer to the payee under such Policies and in substitution for
the obligations of the Company to such payees. 

  

	D.	In the event of the insolvency of any company or companies listed in the designation of “Company” under this Contract, this Article shall apply only to the
insolvent company or companies. 

 ARTICLE XXXIII 

ARBITRATION 
  

	A.	As a condition precedent to any right of action hereunder, any irreconcilable dispute arising out of the interpretation, performance or breach of this Contract,
including the formation or validity thereof, whether arising before or after the expiry or termination of the Contract, shall be submitted for decision to a panel of 3 arbitrators. Notice requesting arbitration will be in writing and sent by
certified mail, return receipt requested, or such reputable courier service as is capable of returning proof of receipt of such notice by the recipient to the party demanding arbitration. 

 

	B.	The Company shall have the option to either litigate or arbitrate where: 

  

	 	1.	The Reinsurer makes any allegation of misrepresentation, non-disclosure, concealment, fraud or bad faith; or 

 

	 	2.	The Reinsurer experiences any of the circumstances set forth in subparagraphs 1 through 7 of paragraph A of the SPECIAL TERMINATION ARTICLE. 

 

	C.	One arbitrator shall be appointed by each party. If either party fails to appoint its arbitrator within 30 days after being requested to do so by the other party, the
latter, after 10 days notice by certified mail or reputable courier as provided above of its intention to do so, may appoint the second arbitrator. 

  

	D.	The two arbitrators shall, before instituting the hearing, appoint an impartial third arbitrator who shall preside at the hearing. Should the two arbitrators fail to
choose the third arbitrator within 30 days of the appointment of the second arbitrator, the parties shall appoint the third arbitrator pursuant to the AIDA Reinsurance and Insurance Arbitration Society -U.S. (ARIAS) Umpire Selection Procedure. All
arbitrators shall be disinterested active or former senior executives of insurance or reinsurance companies or Underwriters at Lloyd’s, London. 

  

					
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	E.	Within 30 days after notice of appointment of all arbitrators, the panel shall meet and determine timely periods for briefs, discovery procedures and schedules for
hearings. The panel shall be relieved of all judicial formality and shall not be bound by the strict rules of procedure and evidence. Unless the panel agrees otherwise, arbitration shall take place in DeRidder, Louisiana but the venue may be changed
when deemed by the panel to be in the best interest of the arbitration proceeding. Insofar as the arbitration panel looks to substantive law, it shall consider the law of the State of Louisiana. The decision of any 2 arbitrators when rendered in
writing shall be final and binding. The panel is empowered to grant interim relief as it may deem appropriate. 

  

	F.	In the event an arbitrator is unable to serve due to death, disability or other incapacity, a replacement arbitrator shall be chosen in accordance with the procedures
set forth in this Article for the original selection of the arbitrator. 

  

	G.	The panel shall make its decision considering the custom and practice of the applicable insurance and reinsurance business as promptly as possible following the
termination of the hearings. Judgment upon the award may be entered in any court having jurisdiction thereof. 

  

	H.	If more than one subscribing reinsurer is involved in arbitration where there are common questions of law or fact and a possibility of conflicting awards or
inconsistent results, all such subscribing 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 subscribing reinsurers constituting the one party; provided,
however, that nothing therein shall impair the rights of such subscribing reinsurers to assert several, rather than joint defenses or claims, nor be construed as changing the liability of the subscribing reinsurers under the terms of this Contract
from several to joint. 

  

	I.	Each party shall bear the expense of its own arbitrator and shall jointly and equally bear with the other party the cost of the third arbitrator. The remaining costs of
the arbitration shall be allocated by the panel. The panel may, at its discretion, award such further costs and expenses as it considers appropriate, including but not limited to attorneys fees, to the extent permitted by law. However, the panel may
not award any Exemplary or Punitive Damages and Enhanced Compensatory Damages. 

 ARTICLE XXXIV

 SERVICE OF SUIT 

(This Article is applicable if the subscribing reinsurer is not domiciled in the United States of America and/or is not authorized in any State, Territory
or District of the United States where authorization is required by insurance regulatory authorities. This Article is not intended to conflict with or override the obligation of the parties to arbitrate their disputes in accordance with the
ARBITRATION ARTICLE.) 

  
 23 

	A.	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, shall
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 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. The
subscribing reinsurer, once the appropriate court is selected, whether such court is the one originally chosen by the Company and accepted by subscribing reinsurer or is determined by removal, transfer, or otherwise, as provided for above, shall
comply with all requirements necessary to give said court jurisdiction and, in any suit instituted against it upon this Contract, and shall abide by the final decision of such court or of any appellate court in the event of an appeal.

  

	B.	Service of process in such suit may be made upon the agent for the service of process (“agent”) named below, depending on the jurisdiction where the Company
chooses to bring suit: 

  

	 	1.	 If the suit is brought in the State of California, the law firm of Mendes and Mount, 445 South Figueroa Street, 38th Floor, Los Angeles, California 90071 shall be authorized and
directed to accept service of process on behalf of the subscribing reinsurer in any such suit; 

  

	 	2.	If the suit is brought in the State of New York, the law firm of Mendes and Mount, 750 Seventh Avenue, New York, New York 10019 shall be authorized and directed to
accept service of process on behalf of the subscribing reinsurer in any such suit; 

  

	 	3.	If the suit is brought in any state other than California or New York, either of the agents described in subparagraphs 1 or 2 above shall be authorized and directed to
accept service of process on behalf of the subscribing reinsurer in any such suit; or 

  

	 	4.	If the subscribing reinsurer has designated an agent in the subscribing reinsurer’s Interests and Liabilities Agreement attached hereto, then that agent shall be
authorized and directed to accept service of process on behalf of the subscribing reinsurer in any suit. However, if an agent is designated in the subscribing reinsurer’s Interests and Liabilities Agreement and the agent is not located in
California as respects a suit brought in California or New York as respects a suit brought in New York, in keeping with the laws of the states of California and New York which require that service be made on an agent located in the respective state
if a suit is brought in that state, the applicable office of Mendes and Mount stipulated in subparagraphs 1 and 2 above must be used for service of suit unless the provisions of paragraph C of this Article apply. 

 

	C.	Further, pursuant to any statute of any state, territory or district of the United States that makes provision therefor, the subscribing reinsurer hereby designates 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 its 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 Contract, and hereby designates the above-named as the person to whom the said officer is authorized to mail such process or a true copy
thereof. 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	24	 	

 ARTICLE XXXV 
 ENTIRE AGREEMENT 
 This Contract shall constitute the entire agreement between the
parties with respect to the business being reinsured hereunder. There are no understandings between the parties other than as expressed in this Contract. Any change or modification to this Contract shall be null and void unless made by amendment to
this Contract and signed by both parties. This Article shall not be construed as limiting in any way the admissibility in the context of an arbitration or any other legal proceeding, evidence regarding the formation, interpretation, purpose or
intent of this Contract. 
 ARTICLE XXXVI 
 MODE OF EXECUTION 
 This Contract may be executed either by an original written ink
signature of paper documents, by an exchange of facsimile copies showing the original written ink signature of paper documents, or by electronic signature by either party employing appropriate software technology as to satisfy the parties at the
time of execution that the version of the document agreed to by each party shall always be capable of authentication and satisfy the same rules of evidence as written signatures. The use of any one or a combination of these methods of execution
shall constitute a legally binding and valid signing of this Contract. This Contract may be executed in one or more counterparts, each of which, when duly executed, shall be deemed an original. 

ARTICLE XXXVII 

INTERMEDIARY 
 Willis Re Inc.,
15305 North Dallas Parkway, Suite 1100, Colonnade III, Addison, Texas 75001 is hereby recognized as the intermediary negotiating this Contract and through whom all communications relating thereto shall be transmitted to the Company or the Reinsurer.
However, all communications concerning accounts, claim information, funds and inquiries related thereto shall be transmitted to the Company or the Reinsurer through Willis Re Inc., 5420 Millstream Road, Suite 200, McLeansville, North Carolina 27301.
Payments by the Company to Willis Re Inc. shall be deemed to constitute payment to the Reinsurer and payments by the Reinsurer to Willis Re Inc. shall be deemed to constitute payment to the Company only to the extent that such payments are actually
received by the Company. 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	25	 	

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

 (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 of 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 Liability
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, 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 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; 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 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 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	1	 	

 (c)
        the        (injury, sickness, disease, death or destruction 
                           (bodily injury or property damages 

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 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” 

 (“property damage” includes all forms of radioactive contamination of property  

(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 operation 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 of the Independent Insurance Conference of Canada. 
  

	*	NOTE: The words printed in italics 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. 

 21/9/67 

N.M.A. 1590 
 BRMA 35A 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	2	 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 ASPEN INSURANCE UK LIMITED 

(the “Subscribing Reinsurer”) 
 with respect to the 
 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a 10.00% share in
the interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. 
 This
Agreement shall commence at 12:01 a.m., Standard Time, January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2013. 
 The share of the Subscribing Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the
Subscribing Reinsurer participate in the interests and liabilities of the other subscribing reinsurers. 
 IN WITNESS WHEREOF, the
Subscribing Reinsurer by its duly authorized representative has executed this Agreement as of the date specified below: 

Signed this 16th day of January, 2012. 
  

							
		 		 		 	

		 		 		 
		 		 		 
		 		 		 
	ASPEN INSURANCE UK LIMITED	 		 
	By	 	/s/ Ryan Ward	 		 
	Print Name	 	Ryan Ward	 		 
	Title	 	Underwriter	 		 

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	 Casualty Catastrophe XOL - I&L
	 		 	

 INTERESTS AND LIABILITIES AGREEMENT 

(the “Agreement”) 
 of 
 UNDERWRITERS AT LLOYD’S, LONDON 

AS SET FORTH IN THE SIGNING PAGE(S) ATTACHED HERETO 
 (the “Subscribing Reinsurer”) 
 with respect to the 

CASUALTY CATASTROPHE EXCESS OF LOSS 
 REINSURANCE CONTRACT 
 (the “Contract”) 

issued to 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 The Subscribing Reinsurer shall have a share in the
interests and liabilities of the “Reinsurer” as set forth in the Contract attached hereto and executed by the Company. The Subscribing Reinsurer’s percentage share shall equal the sum of the final signed lines percentage share(s) as
executed on the attached signing page(s) for Lloyd’s Underwriters. 
 This Agreement shall commence at 12:01 a.m., Standard Time,
January 1, 2012 and shall continue in force until 12:01 a.m., Standard Time, January 1, 2013. 
 The share of the Subscribing
Reinsurer in the interests and liabilities of the “Reinsurer” shall be several and not joint with the share of any other subscribing reinsurer. In no event shall the Subscribing Reinsurer participate in the interests and liabilities of the
other subscribing reinsurers. 
 IN WITNESS WHEREOF, the Subscribing Reinsurer by its duly authorized representative has executed this
Agreement per the attached signing page(s). 

  

					
	 93948003-12 (1-1-12)
	 		 	12/21/11
	 Casualty Catastrophe XOL - I&L
	 		 	

					
	 UMR
	 	 :
	  	B0576USX4990 (93948003-12
	 Reinsured
	 	 :
	  	Amerisafe Insurance Group
	 Type
	 	 :
	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

 INFORMATION 
 THIS INFORMATION SECTION LISTS INFORMATION MADE AVAILABLE TO REINSURERS FOR ASSESSMENT OF THE RISK. IT DOES NOT INCLUDE CONTRACTUAL TERMS AND CONDITIONS. 

ESTIMATED  
 PREMIUM INCOME
284,370,000

 

  

					
	 NB/08-12-2011
	  		  	Information Page 1
		  	Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services Authority. Registered Office: 51 Lime Street, London EC3M 7DQ. Registered
Number 181116 England and Wales.	  	

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

 SECURITY DETAILS 

 

			
		
	 REINSURERS

LIABILITY
	  	Reinsurers Liability Clause LMA3333
		
		  	Reinsurers’ liability several not joint.
		
		  	The liability of a Reinsurer under this contract is several and not joint with other Reinsurers party to this contract. A Reinsurer is liable only for the proportion of liability
it has underwritten. A Reinsurer is not jointly liable for the proportion of liability underwritten by any other Reinsurer. Nor is a Reinsurer otherwise responsible for any liability of any other Reinsurer that may underwrite this
contract.
		
		  	The proportion of liability under this contract underwritten by a Reinsurer (or, in the case of a Lloyd’s syndicate, the total of the proportions underwritten by all the
members of the syndicate taken together) is shown next to its stamp. This is subject always to the provision concerning “signing” below.
		
		  	In the case of a Lloyd’s syndicate, each member of the syndicate (rather than the syndicate itself) is a Reinsurer. Each member has underwritten a proportion of the total
shown for the syndicate (that total itself being the total of the proportions underwritten by all the members of the syndicate taken together). The liability of each member of the syndicate is several and not joint with other members. A member is
liable only for that member’s proportion. A member is not jointly liable for any other member’s proportion. Nor is any member otherwise responsible for any liability of any other Reinsurer that may underwrite this contract. The business
address of each member is Lloyd’s, One Lime Street, London EC3M 7HA. The identity of each member of a Lloyd’s syndicate and their respective proportion may be obtained by writing to Market Services, Lloyd’s, at the above
address.
		
		  	 Proportion of liability

		
		  	Unless there is “signing” (see below), the proportion of liability under this contract underwritten by each Reinsurer (or, in the case of a Lloyd’s syndicate, the
total of the proportions underwritten by all the members of the syndicate taken together) is shown next to its stamp and is referred to as its “written line”.
		
		  	Where this contract permits, written lines, or certain written lines, may be adjusted (“signed”). In that case a schedule is to be appended to this contract to show the
definitive proportion of liability under this contract underwritten by each Reinsurer (or, in the case of a Lloyd’s syndicate, the total of the proportions underwritten by all the members of the syndicate taken together). A definitive
proportion (or, in the case of a Lloyd’s syndicate, the total of the proportions underwritten by all the members of a Lloyd’s

  

			
	 NB/08-12-2011
	 	 Security Details Page 1

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

			
		
		  	syndicate taken together) is referred to as a “signed line”. The signed lines shown in the schedule will prevail over the written lines unless a proven error in
calculation has occurred.
		
		  	Although reference is made at various points in this clause to “this contract’ in the singular, where the circumstances so require this should be read as a reference to
contracts in the plural.
		
	 ORDER HEREON
	  	42.50%
		
	 BASIS OF

WRITTEN LINES
	  	Percentage of Whole
		
	 SIGNING

PROVISIONS
	  	In the event that the placement of this Reinsurance is not completed by the commencement date of the period of Reinsurance then all lines written by that date, at the
Reinsured’s option, may be signed in full. If such written lines hereon exceed 100% of the order, all lines written will be signed down in equal proportions so that the aggregate signed lines are equal to 100% of the order.
		
		  	Whether before or after inception of the period of Reinsurance, the Reinsured may elect for the disproportionate signing of Reinsurer’s lines without further specific
agreement of Reinsurers.
		
	 LINE CONDITIONS
	  	None unless specified individually by Reinsurers hereon under their written participations.

  

			
	 NB/08-12-2011
	 	 Security Details Page 2

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

 CONTRACT ADMINISTRATION AND ADVISORY SECTIONS 

SUBSCRIPTION AGREEMENT 
  

			
		
	 SLIP LEADER
	  	ASPEN RE
		
	 BASIS OF

AGREEMENT TO

CONTRACT
 CHANGES
	  	Reinsurers hereon authorise the Slip Leader to be the sole judge in determining whether any future alterations to this Reinsurance Agreement should be by agreement of the Slip
Leader only and copied to other Reinsurers, or by agreement of all Reinsurers.
		
	 BASIS OF CLAIMS

AGREEMENT
	  	Claims review, as required by Slip Leader for the benefit of and at the cost to current Reinsurers hereon. Settlement of fees will be by the parties authorising the claims
review. In the event of cancellation of the Treaty, fees to be borne by final contract year.
		
		  	 Lloyd’s Underwriters

		
		  	Claims to be managed in accordance with the Lloyd’s 2006 Claims Scheme or as amended.
		
		  	 IUA Company Underwriters

		
		  	Claims to be managed in accordance with IUA Claims Agreement practices.
		
		  	 Non-Bureaux Underwriters

		
		  	All claims to be agreed by each Reinsurer according to their own practices.
		
	 CLAIMS

AGREEMENT

PARTIES
	  	 Lloyd’s Underwriters

		
		  	Where the Lloyd’s 2006 Claims Scheme applies:
		
		  	Lloyd’s syndicates(s) in accordance with the Lloyd’s 2006 Claims Scheme.
		
		  	Xchanging Claims Services where there is more than one subscribing Lloyd’s Managing Agent or if a single subscribing Lloyd’s Managing Agent so
requires.
		
		  	Or:

  

			
	 NB/08-12-2011
	 	 Subscription Agreement Page 1

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 EngIand and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

			
		  	Where the Lloyd’s 2006 Claims Scheme amended or any successor thereto applies:
		
		  	Lloyd’s syndicate(s) in accordance with the Lloyd’s 2006 Claims Scheme amended or any successor thereto.
		
		  	IUA Company and Non-Bureaux Underwriters
		
		  	All claims to be agreed by each Reinsurer in respect of their own participation.
		
	CLAIMS ADMINISTRATION	  	Lloyd’s Underwriters
		
		  	Willis Limited and Reinsurers agree that any claims hereunder (including any claims related costs/fees) that are in scope and supported by Electronic Claims File (ECF) may be
notified and administered via the Electronic Claims File (ECF) system with any payment(s) processed via CLASS.
		
		  	Lloyd’s Underwriters authorise Xchanging Claims Services to waive the deferred settlement system in the event of presentation of settlement request with first
advice.
		
		  	IUA Company Underwriters
		
		  	All IUA Company Underwriters agree to respond to claims via CLASS.
		
		  	Willis Limited and Reinsurers agree that any claims hereunder (including any claims related costs/fees) that are in scope and supported by Electronic Claims File (ECF) may be
notified and administered via the Electronic Claims File (ECF) system with any payment(s) processed via CLASS.
		
		  	Non-Bureaux Underwriters
		
		  	Agree to receive all claims via Broker visit, email, repositories, facsimile or letter.
		
	RULES AND EXTENT OF ANY OTHER DELEGATED CLAIMS AUTHORITY	  	None unless otherwise specified.

  

			
	 NB/08-12-2011
	 	 Subscription Agreement Page 2

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial
Services Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

			
		
	SETTLEMENT DUE DATE	  	29/02/2012
		
	INSTALMENT PREMIUM PERIOD OF CREDIT	  	+30 days.
		
	ADJUSTMENT PREMIUM PERIOD OF CREDIT	  	+60 days.
		
	BUREAUX ARRANGEMENTS	  	Presentation of premium documentation to XIS by the Settlement Due Date(s) is deemed to be in compliance with the payment provisions.
		
		  	If the Settlement Due Date falls on a Saturday, a Sunday or a Bank Holiday, it is agreed that the Settlement Due Date shall be changed to the first following working
day.
		
		  	XIS are authorised to sign policies in multiple copies
		
		  	Processing Documents:
		
		  	XIS are authorised to accept Additional Premium or Return Premium or Premium Adjustment or Profit Commission figures, where applicable, without certification or production of
letters or other documents and enter in accordance with the figures shown thereon, without Reinsurers agreement.
		
		  	Reinsurers agree to the use of a copy (including a photocopy) or duplicate of the applicable Slip or Wording for the collection and taking down of Additional Premium(s) or Return
Premium(s) or Premium Adjustment(s) or Profit Commission(s).
		
		  	Reinsurers agree that the Intermediary may settle Premiums for this Reinsurance Contract at different times.
		
		  	Premium Processing Clause - LSW 3003 (14/12/09)
		
		  	Where the premium is to be paid through Xchanging Ins-sure Services (XIS), payment to Reinsurers will be deemed to occur on the day that a delinked premium is released for
settlement by the Appointed Broker or in the case of non-delinked premiums, on the day that the error-free Premium Advice Note (PAN) is submitted to XIS.

  

			
	 NB/ 08-12-2011
	 	 Subscription Agreement Page 3

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

			
		
		  	Where premiums are to be paid by instalments under the Deferred Account Scheme, and the Appointed Broker does not receive the premium in time to comply with the agreed settlement
date for the second or subsequent instalment, the Appointed Broker, if electing to suspend the automatic debiting of the relevant deferred instalment, shall advise the Slip Leader in writing and instruct XIS accordingly. XIS shall then notify
Reinsurers. Payment to any entity within the same group of companies as the Appointed Broker will be deemed to be payment to the Appointed Broker.
		
		  	Nothing in this clause shall be construed to override the terms of any Premium Payment Warranty or Clause or any Termination or Cancellation provision contained in this contract.
Furthermore, any amendment to the Settlement Due Date of a premium instalment as a result of the operation of this Premium Processing Clause shall not amend the date that such instalment is deemed to be due for the purposes of such Premium Payment
Warranty or Clause or Termination or Cancellation provision unless (Re)Insurers expressly agree otherwise.
		
		  	Appointed Broker: Willis Limited.

  

			
	 NB/08-12-2011
	 	 Subscription Agreement Page 4

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

 FISCAL AND REGULATORY 

 

			
	 TAX PAYABLE BY

REINSURERS
	  	1% Federal Excise Tax where applicable or as statutorily required.
		
	 COUNTRY OF

ORIGIN
	  	USA.
		
	 OVERSEAS

BROKER
	  	 Willis Re Inc.,
 15305 North
Dallas Parkway
 Suite 1100
 Colonnade
III
 Addison
 Texas 75001

USA

		
	 U.S.

CLASSIFICATION
	  	U.S. Reinsurance.
		
	 N.A.I.C. CODES
	  	NAIC number: 12228, 31895, 26869                

		
	 ALLOCATION OF

PREMIUM TO

CODING
	  	100% W6.
		
	 FSA CLIENT

CLASSIFICATION
	  	Reinsurance.

  

			
	NB/08-12-2011	 	 Fiscal and Regulatory Page 1

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

 BROKER REMUNERATION AND DEDUCTIONS 

 

			
	 FEE PAYABLE BY

CLIENT?
	  	No.
		
	 TOTAL BROKERAGE
	  	15% Brokerage
		
	 OTHER DEDUCTIONS

FROM PREMIUM
	  	None.

  

			
	NB/08-12-2011	 	 Broker Remuneration and Deductions Page 1

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

 WRITTEN LINES 

B.I.P.A.R. Statement 
 In a co-reinsurance placement, following reinsurers may, but are not obliged to, follow the premium charged by the lead reinsurer. 
 Reinsurers may not seek to guarantee for themselves terms as favourable as those which others subsequently achieve during the placement. 

 

					
	 Reinsurer and
	  		  	
	 Reference:
	  		  	
		
		  	

		  		  	
			
	 Written Line:
	  	30%        % Ref.:	  	
			
	 Final Signed Line:
	  	10%	  	
			
		  	    %	  	
			
		  	    %	  	
			
		  	    %	  	
			
		  	    %	  	
			
	 Line Conditions:
	  		  	
			
	 Dated:
	  		  	

  

			
		 	 Written Lines
Page        of        

	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	 UMR
	 	 :
	  	B0576USX4990 (93948003-12
	 Reinsured
	 	 :
	  	Amerisafe Insurance Group
	 Type
	 	 :
	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

 WRITTEN LINES 
 B.I.P.A.R. Statement 
 In a co-reinsurance placement, following
reinsurers may, but are not obliged to, follow the premium charged by the lead reinsurer. 
 Reinsurers may not seek to
guarantee for themselves terms as favourable as those which others subsequently achieve during the placement. 
  

			
		
	 Reinsurer and Reference:
	  	 10%

		
		  	

		
	 Written Line:
	  	% Ref.:
		
	 Final Signed Line:
	  	10%
		
		  	    %
		
		  	    %
		
		  	    %
		
		  	    %
		
	 Line Conditions:
	  	
		
	 Dated:
	  	

  

					
		  		  	Written Lines Page         of        
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

							
	 UMR
	 		  	:	  	B0576USX4990 (93948003-12
	 Reinsured
	 		  	:	  	Amerisafe Insurance Group
	 Type
	 		  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

 WRITTEN LINES 
 B.I.P.A.R. Statement 
 In a co-reinsurance placement, following
reinsurers may, but are not obliged to, follow the premium charged by the lead reinsurer. 
 Reinsurers may not seek to
guarantee for themselves terms as favourable as those which others subsequently achieve during the placement. 
  

			
		
	 Reinsurer and Reference:
	  	
		
		  	

		
		  	
		
	 Written Line:
	  	12 1/2% Ref.: BA543V12A000

		
	 Final Signed Line:
	  	7 1/2 %
		
		  	    %
		
		  	    %
		
		  	    %
		
		  	    %
		
	 Line Conditions:
	  	
		
	 Dated:
	  	

  

					
		  		  	Written Lines Page         of        
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

							
	 UMR
	 		  	:	  	B0576USX4990 (93948003-12
	 Reinsured
	 		  	:	  	Amerisafe Insurance Group
	 Type
	 		  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

 WRITTEN LINES 
 B.I.P.A.R. Statement 
 In a co-reinsurance placement, following
reinsurers may, but are not obliged to, follow the premium charged by the lead reinsurer. 
 Reinsurers may not seek to
guarantee for themselves terms as favourable as those which others subsequently achieve during the placement. 
  

			
		
	 Reinsurer and Reference:
	  	
		
		  	

		
		  	
		
	 Written Line:
	  	7.5%     Ref.:
		
	 Final Signed Line:
	  	7.5%
		
		  	    %
		
		  	    %
		
		  	    %
		
		  	    %
		
	 Line Conditions:
	  	
		
	 Dated:
	  	

  

					
		  		  	Written Lines Page         of        
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EC3M 7DQ. Registered Number 181116 England and
Wales.

					
	UMR	  	:	  	B0576USX4990 (93948003-12
	Reinsured	  	:	  	Amerisafe Insurance Group
	Type	  	:	  	Casualty Catastrophe Excess of Loss Reinsurance Contract

  

  
 

 
 WRITTEN LINES 
 B.I.P.A.R. Statement 
 In a co-reinsurance placement, following reinsurers may,
but are not obliged to, follow the premium charged by the lead reinsurer. 
 Reinsurers may not seek to guarantee for themselves terms as
favourable as those which others subsequently achieve during the placement. 
  

			
	Reinsurer and	  	
	Reference:	  	
		
		  	

		
		  	
		
	Written Line:	  	20     %     Ref.: CAHX 2056121A
		
	Final Signed Line:	  	7.5 %
		
		  	      %
		
		  	      %
		
		  	      %
		
		  	      %
		
	Line Conditions:	  	
	
	Dated: 27/12- 2011

  

			
		 	Written Lines Page         of        
	
	 Willis Limited, a Lloyd’s broker, authorised and regulated by the Financial Services
Authority.
 Registered Office: 51 Lime Street, London EQM 7DQ. Registered Number 181116 England and
Wales.

 AMERICAN INTERSTATE INSURANCE COMPANY 

DeRidder, Louisiana 
 and 
 AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 

Austin, Texas 
 and 
 SILVER OAK CASUALTY, INC. 

DeRidder, Louisiana 
 and 
 any other insurance companies which are now or hereafter come under
the ownership, 
 control or management of Amerisafe Insurance Group 

CASUALTY CATASTROPHE EXCESS OF LOSS 
 REINSURANCE CONTRACT 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 		 	

 TABLE OF CONTENTS 

 

					
	 ARTICLE
	  	 	  	PAGE
			
	 I
	  	BUSINESS COVERED	  	1
			
	 II
	  	TERM	  	2
			
	 III
	  	SPECIAL TERMINATION	  	2
			
	 IV
	  	DEFINITIONS	  	4
			
		  	 Act of Terrorism
	  	4
			
		  	 Declaratory Judgment Expense
	  	4
			
		  	 Extra Contractual Obligations/Loss in Excess of Policy Limits
	  	4
			
		  	 Loss Adjustment Expense
	  	5
			
		  	 Loss Occurrence
	  	5
			
		  	 Net Earned Premium
	  	6
			
		  	 Policy
	  	6
			
	 V
	  	TERRITORY	  	6
			
	 VI
	  	EXCLUSIONS	  	6
			
	 VII
	  	TERRORISM ACT RECOVERIES	  	9
			
	 VIII
	  	COVERAGE	  	9
			
	 IX
	  	REINSTATEMENT	  	10
			
	 X
	  	SPECIAL ACCEPTANCE	  	10
			
	 XI
	  	ACCOUNTING BASIS	  	11
			
	 XII
	  	REINSURANCE PREMIUM	  	11
			
	 XIII
	  	NOTICE OF LOSS AND LOSS SETTLEMENTS	  	11
			
	 XIV
	  	LIABILITY OF REINSURERS	  	12
			
	 XV
	  	LATE PAYMENTS	  	13
			
	 XVI
	  	ANNUITIES AT THE COMPANY’S OPTION	  	14
			
	 XVII
	  	AGENCY AGREEMENT	  	14
			
	 XVIII
	  	SUBROGATION	  	14
			
	 XIX
	  	ERRORS AND OMISSIONS	  	14
			
	 XX
	  	OFFSET	  	15
			
	 XXI
	  	CURRENCY	  	15
			
	 XXII
	  	TAXES	  	15
			
	 XXIII
	  	FEDERAL EXCISE TAX	  	15
			
	 XXIV
	  	RESERVES AND FUNDING	  	16
			
	 XXV
	  	NET RETAINED LINES	  	17
			
	 XXVI
	  	THIRD PARTY RIGHTS	  	18
			
	 XXVII
	  	SEVERABILITY	  	18

  

					
	 93948003-12 (1-1-12)
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	 Casualty Catastrophe XOL Contract
	 		 	

					
			
	 XXVIII
	  	GOVERNING LAW	  	18
			
	 XXIX
	  	INSPECTION OF RECORDS	  	18
			
	 XXX
	  	CONFIDENTIALITY	  	19
			
	 XXXI
	  	SUNSET AND COMMUTATION	  	20
			
	 XXXII
	  	INSOLVENCY	  	21
			
	 XXXIII
	  	ARBITRATION	  	22
			
	 XXXIV
	  	SERVICE OF SUIT	  	23
			
	 XXXV
	  	ENTIRE AGREEMENT	  	25
			
	 XXXVI
	  	MODE OF EXECUTION	  	25
			
	 XXXVII
	  	INTERMEDIARY	  	25
			
		  	Nuclear Incident Exclusion Clause - Liability - Reinsurance - U.S.A.	  	

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 		 	

 CASUALTY CATASTROPHE EXCESS OF LOSS 

REINSURANCE CONTRACT 
 (the “Contract”) 
 between 

AMERICAN INTERSTATE INSURANCE COMPANY 
 DeRidder, Louisiana 
 and 

AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS 
 Austin, Texas 
 and 

SILVER OAK CASUALTY, INC. 
 DeRidder, Louisiana 
 and 

any other insurance companies which are now or hereafter come under the ownership, 

control or management of Amerisafe Insurance Group 
 (collectively the “Company”) 
 and 

THE SUBSCRIBING REINSURER(S) EXECUTING THE 
 INTERESTS AND LIABILITIES AGREEMENT(S) 
 ATTACHED HERETO 

(the “Reinsurer”) 
 ARTICLE I 
 BUSINESS COVERED 

 

	A.	By this Contract the Reinsurer agrees to reinsure the excess liability of the Company under its Policies that are in force at the effective time and date hereof or
issued or renewed at or after that time and date, and classified by the Company as Workers’ Compensation, Employers Liability, including but not limited to coverage provided under the U.S. Longshore and Harbor Workers’ Compensation Act,
Jones Act, Outer Continental Shelf Lands Act and any other Federal Coverage extensions and General Liability business, subject to the terms, conditions and limitations hereafter set forth. 

 

	B.	The Reinsurer further agrees to reinsure the excess liability of the Company under Policies issued by Cooperative Mutual Insurance Company that are in force at the
effective time and date hereof or issued or renewed at or after that time and date, and classified by the Company as Workers’ Compensation, Employers Liability, including but not limited to coverage provided under the U.S. Longshore and Harbor
Workers’ Compensation Act, Jones Act, Outer Continental Shelf Lands Act and any other Federal Coverage extensions and General Liability business, subject to the terms, conditions and limitations hereafter set forth. 

 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	1	 	

 ARTICLE II 
 TERM 
  

	A.	This Contract will apply to all losses occurring during the period January 1, 2012, 12:01 a.m. Standard Time (as set forth in the Company’s policies), to
January 1, 2013, 12:01 a.m. Standard Time. 

  

	B.	Upon the expiration or termination of this Contract, the entire liability of the Reinsurer for losses occurring subsequent to the date of expiration shall cease
concurrently with the date of expiration of this Contract. 

  

	C.	Notwithstanding the above, upon expiration or termination of this Contract, the Company shall have the option of requiring that the Reinsurer shall remain liable for
losses occurring under Policies in force on the expiration or termination date of this Contract until the next renewal, termination, or natural expiration date of such Policies or until 12 months (plus “odd time,” not to exceed 18 months
in all) following the date of expiration (whichever occurs first). 

  

	D.	If this Contract expires while a Loss Occurrence covered hereunder is in progress, the Reinsurer’s liability hereunder shall, subject to the other terms and
conditions of this Contract, be determined as if the entire Loss Occurrence had occurred prior to the expiration of this Contract, provided that no part of such Loss Occurrence is claimed against any renewal or replacement of this Contract.

 ARTICLE III 
 SPECIAL TERMINATION 
  

	A.	The Company may terminate a subscribing reinsurer’s share in this Contract by giving written notice to the subscribing reinsurer upon the happening of any one of
the following circumstances: 

  

	 	1.	A State Insurance Department or other legal authority orders the subscribing reinsurer to cease writing business, or 

 

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

  

	 	3.	For any period not exceeding 12 months which commences no earlier than 12 months prior to the inception of this Contract, the subscribing reinsurer’s
policyholders’ surplus, as reported in the financial statements of the subscribing reinsurer, has been reduced by 20.0% or more, or 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	2	 	

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

  

	 	5.	The subscribing reinsurer has reinsured its entire liability under this Contract without the Company’s prior written consent, or 

 

	 	6.	The subscribing reinsurer receives an A. M. Best rating of lower than A-, or an S&P financial strength rating of lower than A-, or 

 

	 	7.	The subscribing reinsurer has ceased writing new and renewal reinsurance for the lines of business covered hereunder. 

 

	B.	In the event of such termination, the liability of the subscribing reinsurer shall be terminated, at the Company’s option, either in accordance with the cutoff
provisions of paragraph B of the TERM ARTICLE or in accordance with the runoff provisions of paragraph C of the TERM ARTICLE, and such termination shall be effective as of the date the subscribing reinsurer receives written notice of termination
pursuant to paragraph A above. 

  

	C.	In the event the Company terminates a subscribing reinsurer’s share in this Contract under the provisions of this Article, the Company shall have the option to
commute the excess liabilities of the subscribing reinsurer. If this commutation option is exercised, the provisions of the paragraphs B through G of the SUNSET AND COMMUTATION ARTICLE shall apply. 

 

	D.	In the event the Company terminates a subscribing reinsurer’s share in this Contract under the provision of this Article, the Company shall have the option to
require the subscribing reinsurer to fund its share of ceded unearned premium, outstanding loss and Loss Adjustment Expense reserves, reserves for losses and Loss Adjustment Expense incurred but not reported to the Company (IBNR as determined by the
Company) and any other balances or financial obligations. Within 30 days of the Company’s written request to fund, the subscribing reinsurer shall provide to the Company a clean, unconditional, evergreen, irrevocable letter of credit or a trust
agreement which establishes a trust account for the benefit of the Company. The method of funding must be acceptable to the Company, shall be established with a financial institution suitable to the Company, shall comply with any applicable state or
federal laws or regulations involving the Company’s ability to recognize these agreements as assets or offsets to liabilities in such jurisdictions and shall be at the sole expense of the subscribing reinsurer. The Company and the subscribing
reinsurer may mutually agree on alternative methods of funding or the use of a combination of methods. This option is available to the Company at any time there remains any outstanding liabilities of the subscribing reinsurer. Notwithstanding the
foregoing, the Company shall not require funding in accordance with this subparagraph in the event the subscribing reinsurer has otherwise fully funded its obligations under this Contract in a manner acceptable to the Company.

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	3	 	

 ARTICLE IV 
 DEFINITIONS 
  

	A.	Act of Terrorism 

 “Act of
Terrorism” as used herein shall follow the definition provided under the Terrorism Risk Insurance Act of 2002 (TRIA) and as amended by the Terrorism Risk Insurance Extension Act of 2005 (TRIEA) and the Terrorism Risk Insurance Program
Reauthorization Act of 2007 (TRIPRA), together and including any extensions or replacement thereof, the “Terrorism Act.” 
  

	B.	Declaratory Judgment Expense 

“Declaratory Judgment Expense” as used herein shall mean all expenses incurred by the Company in connection with a declaratory
judgment action brought to determine the Company’s defense and/or indemnification obligations that are allocable to a specific claim subject to this Contract. Declaratory Judgment Expense shall be deemed to have been incurred on the date of the
original loss (if any) giving rise to the declaratory judgment action. 
  

	C.	Extra Contractual Obligations/Loss in Excess of Policy Limits 

  

	 	1.	Extra Contractual Obligations 

This Contract shall protect the Company for any “Extra Contractual Obligations” which as used herein shall mean any punitive,
exemplary, compensatory or consequential damages, other than Loss in Excess of Policy Limits, paid or payable by the Company as a result of an action against it by its insured, its insured’s assignee or a third party claimant, by reason of
alleged or actual negligence, fraud or bad faith on the part of the Company in handling a claim under a Policy subject to this Contract. 
 An Extra Contractual Obligation shall be deemed to have occurred on the same date as the loss covered or alleged to be covered under the Policy. 

 

	 	2.	Loss in Excess of Policy Limits 

This Contract shall protect the Company for any “Loss in Excess of Policy Limits” which as used herein shall mean an amount that
the Company would have been contractually liable to pay had it not been for the limit of the original Policy as a result of an action against it by its insured, its insured’s assignee or a third party claimant. Such loss in excess of the limit
shall have been incurred because of 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 its insured or in the preparation or prosecution of an appeal consequent upon such action. 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	4	 	

	 	3.	This paragraph C shall not apply where an Extra Contractual Obligation and/or Loss in Excess of Policy Limits has been incurred due to an adjudicated finding of fraud
committed by a member of the Board of Directors or a corporate officer of the Company acting individually or collectively or in collusion with a member of the Board of Directors or a corporate officer or a partner of any other corporation or
partnership. 

  

	D.	Loss Adjustment Expense 

“Loss Adjustment Expense” as used herein shall mean all costs and expenses allocable to a specific claim that are incurred by
the Company in the investigation, appraisal, adjustment, settlement, litigation, defense or appeal of a specific claim, including court costs and costs of supersedeas and appeal bonds, and including 1) pre-judgment interest, unless included as part
of the award or judgment; 2) post-judgment interest; 3) legal expenses and costs incurred in connection with coverage questions and legal actions connected thereto, including Declaratory Judgment Expense; and 4) a pro rata share of salaries and
expenses of Company field employees, and expenses of other Company employees who have been temporarily diverted from their normal and customary duties and assigned to the field adjustment of losses covered by this Contract. Loss Adjustment Expense
does not include unallocated loss adjustment expense. Unallocated loss adjustment expense includes, but is not limited to, salaries and expenses of employees, other than (4) above, and office and other overhead expenses. 

 

	E.	Loss Occurrence 

 “Loss
Occurrence” as used in this Contract shall mean any one disaster or casualty or accident or loss or series of disasters or casualties or accidents or losses arising out of or caused by one event. The Company shall be the sole judge of what
constitutes one event as outlined herein and in the original Policy. 
  

	 	1.	As respects losses resulting from Occupational or Industrial Disease or Cumulative Trauma, each employee shall be considered a separate Loss Occurrence subject to the
following: 

 Losses resulting from Occupational or Industrial Disease or Cumulative Trauma suffered by employees
of an insured for which the employer is liable, as a result of a sudden and accidental event not exceeding 72 hours in duration, shall be considered one Loss Occurrence and may be combined with losses classified as other than Occupational or
Industrial Disease or Cumulative Trauma which arise out of the same event and the combination of such losses shall be considered as one Loss Occurrence within the meaning hereof. 

A loss with respect to each employee affected by an Occupational Disease or Cumulative Trauma shall be deemed to have been sustained by
the Company on the date of the beginning of the disability for which compensation is payable. 
 The terms “Occupational or
Industrial Disease” and “Cumulative Trauma” as used in this Contract shall be as defined by applicable statutes or regulations. 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	5	 	

	 	2.	As respects General Liability policies where the Company’s limit of liability for Products and Completed Operations coverages is determined on the basis of the
insured’s aggregate losses during a policy period, all such losses proceeding from or traceable to the same causative agency shall, at the Company’s option, be deemed to have been caused by one occurrence commencing at the beginning of the
policy period, it being understood and agreed that each renewal or annual anniversary date of the policy involved shall be deemed the beginning of a new policy period. 

 

	F.	Net Earned Premium 

 “Net
Earned Premium” as used herein is defined as gross earned premium of the Company for the classes of business reinsured hereunder, less the earned portion of premiums ceded by the Company for reinsurance which inures to the benefit of this
Contract and less dividends paid or accrued. 
  

	G.	Policy 

 “Policy” or
“Policies” as used herein shall mean the Company’s or Cooperative Mutual Insurance Company’s binders, policies and contracts providing insurance or reinsurance on the classes of business covered under this Contract. 

 

	H.	Ultimate Net Loss 

“Ultimate Net Loss” shall mean the actual loss, including any pre-judgment interest which is included as part of the award or
judgment, “Second Injury Fund” assessments that can be allocated to specific claims, Loss Adjustment Expense, 90% of Loss in Excess of Policy Limits, and 90% of Extra Contractual Obligations, paid or to be paid by the Company on its net
retained liability after making deductions for all recoveries, subrogations and all claims on inuring reinsurance, whether collectible or not; provided, however, that in the event of the insolvency of the Company, payment by the Reinsurer shall be
made in accordance with the provisions of the INSOLVENCY ARTICLE. Nothing herein shall be construed to mean that losses under this Contract are not recoverable until the Company’s Ultimate Net Loss has been ascertained. 

Notwithstanding the definition of “Ultimate Net Loss” herein, the provisions of paragraph H of the COVERAGE ARTICLE as respects
the Minnesota Workers’ Compensation Reinsurance Association shall apply. 
 ARTICLE V 

TERRITORY 
 The territorial limits
of this Contract shall be identical with those of the Company’s Policies. 
 ARTICLE VI 

EXCLUSIONS 
  

	A.	This Contract does not apply to and specifically excludes the following: 

  

	 	1.	Reinsurance assumed by the Company under obligatory reinsurance agreements, except: 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	6	 	

	 	a.	Agency reinsurance where the policies involved are to be reunderwritten in accordance with the underwriting standards of the Company and reissued as Company policies at
the next anniversary or expiration date; and 

  

	 	b.	Intercompany reinsurance between any of the reinsured companies under this Contract. 

 

	 	c.	Reinsurance assumed through Policies issued by Cooperative Mutual Insurance Company. 

 

	 	2.	Nuclear risks as defined in the “Nuclear Incident Exclusion Clause – Liability – Reinsurance – U.S.A.” (NMA 1590 21/9/67) attached hereto.

  

	 	3.	Liability as a member, subscriber or reinsurer of any Pool, Syndicate or Association, including Assigned Risk Plans or similar plans; however, this exclusion shall not
apply to liability under a Policy specifically designated to the Company from an Assigned Risk Plan or similar plan. 

  

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

  

	 	5.	Any “Act of Terrorism” involving the use of nuclear, chemical, biological or radiological devices. 

 

	 	6.	Business written to apply in excess of a deductible of more than $25,000, and business issued to apply specifically in excess over underlying insurance. However, if the
Company is required, by any state regulation, to provide a deductible of more than $25,000, this exclusion shall not apply. 

  

	 	7.	Workers’ Compensation where the principal exposure, as defined by the governing class code, is: 

 

	 	a.	Operation of aircraft, but only if the annual estimated policy premium is $250,000 or more; 

 

	 	b.	Operation of Railroads, subways or street railways; 

  

	 	c.	Manufacturing, assembly, packing or processing of fireworks, fuses, nitroglycerine, magnesium, pyroxylin, ammunition or explosives. This exclusion does not apply to the
assembly, packing or processing of explosives when the estimated annual premium is under $250,000 and does not apply to the commercial use of explosives; 

  

	 	d.	Underground mining. 

  

					
	 93948003-12 (1-1-12)
	 		 	12-21-11
	 Casualty Catastrophe XOL Contract
	 	7	 	

	 	8.	As respects General Liability policies, exposures other than those identified below, as included in the General Liability section of the Company’s Commercial Lines
Manual: 

  

	 	a.	Class 97111 – Logging; 

  

	 	b.	Class 58873 – Sawmill; 

  

	 	c.	Class 59984 – Woodyard and Drivers; 

  

	 	d.	Class 95410 – Grading of Land; 

  

	 	e.	Class 45819 – Lumber Yard; 

  

	 	f.	Class 10073 – Repair Shops and Drivers; 

  

	 	g.	Class 43822 – Timber Cruiser; 

  

	 	h.	Class 99793 – Truckmen Not Otherwise Classified; 

  

	 	i.	Class 91591 – Contractors – Subcontracted Work Other Than Construction; 

 

	 	j.	Class 49452 – Vacant Land. 

  

	B.	Notwithstanding the foregoing, insureds regularly engaged in operations not excluded under paragraph A above, but whose operations may include one or more perils
excluded therein, shall not be excluded from coverage afforded by this Contract, provided said operations are incidental to the main operations of the insured. Notwithstanding the foregoing, coverage extended under this paragraph for incidental
operations of an insured shall not apply to exposures excluded under subparagraphs 1 though 5 of paragraph A above. The Company shall be the judge of what constitutes an incidental part of the insured’s operation. 

 

	C.	Except for subparagraphs 1 through 5 of paragraph A above, if the Company is inadvertently bound or is unknowingly exposed (due to error or automatic provisions of
policy coverage) on a risk otherwise excluded in paragraph A above, such exclusion shall be waived. The duration of said waiver will not extend beyond the time that notice of such coverage has been received by a responsible underwriting authority of
the Company and for a period not exceeding 30 days thereafter, or such longer period required to conform with any notice of cancellation provisions prescribed by regulatory authorities, such period not to exceed 12 months plus odd time (not
exceeding 18 months). 

  

	D.	If the Company is required to accept an assigned risk which conflicts with one or more of the exclusions set forth in subparagraph 6 of paragraph A, reinsurance shall
apply, but only for the difference between the Company’s retention and the limit required by the applicable state statute, and in no event shall the Reinsurer’s liability exceed the limit set forth in the Coverage Article.

  

	E.	Notwithstanding the foregoing, any reinsurance falling within the scope of one or more of the exclusions set forth above that is specially accepted by the Reinsurer
from the Company shall be covered under this Contract and be subject to the terms hereof. 

  

	F.	Except for subparagraphs 1 through 5 of paragraph A above, should a court of competent jurisdiction invalidate any exclusion or expand coverage of the original Policy
of the Company, any amount of Loss for which the Company would not be liable, except for such invalidation or expansion of coverage, shall not be subject to any of the exclusions, conditions and limitations hereinafter set forth under this Contract.

  

					
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 ARTICLE VII 
 TERRORISM ACT RECOVERIES 
  

	A.	Any financial assistance the Company receives under the Terrorism Act, shall apply as follows: 

 

	 	1.	Except as provided in subparagraph 2 below, any such financial assistance shall inure solely to the benefit of the Company and shall be entirely disregarded in applying
all of the provisions of this Contract. 

  

	 	2.	If losses occurring hereunder result in recoveries made by the Company both under this Contract and under the Terrorism Act, and such recoveries, together with any
other reinsurance recoverables made by the Company applicable to said losses, exceed the total amount of the Company’s insured losses, any amount in excess thereof shall reduce the Ultimate Net Loss subject to this Contract for the losses to
which the Terrorism Act assistance applies. These recoveries shall be returned in proportion to each Reinsurer’s paid share of the loss. 

  

	B.	Nothing herein shall be construed to mean that the losses under this Contract are not recoverable until the Company has received financial assistance under the
Terrorism Act. 

 ARTICLE VIII 
 COVERAGE 
  

	A.	The Reinsurer shall be liable for the Ultimate Net Loss in excess of $10,000,000 as a result of any one Loss Occurrence. The Reinsurer’s liability in respect of
any one Loss Occurrence shall not exceed $40,000,000. 

  

	B.	The Reinsurer’s liability in respect of Ultimate Net Loss amounts recoverable hereunder for an Act of Terrorism (as defined in the definition of “Act of
Terrorism”) occurring during the term of this Contract shall not exceed $40,000,000. This paragraph is not subject the REINSTATEMENT ARTICLE. 

  

	C.	The Reinsurer’s liability in respect of all losses occurring during the term of this Contract shall not exceed $80,000,000. 

 

	D.	As respects the statutory portion of any Workers’ Compensation Policy, the Company’s Ultimate Net Loss subject to this Contract shall not exceed $10,000,000
as respects any one life, each Loss Occurrence 

  

	E.	The Company shall be permitted to purchase (or maintain) other reinsurance which inures to the benefit of this Contract. 

 

	F.	The Company shall be permitted to carry underlying reinsurance, recoveries under which shall inure solely to the benefit of the Company and be entirely disregarded in
applying all of the provisions of this Contract. 

  

					
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	G.	As respects Employers Liability and General Liability, the maximum net subject Policy limit (except statutory where required by law) as respects any one Policy shall be
$2,000,000 or the Company shall be deemed to have purchased inuring excess facultative reinsurance for subject Policy limits in excess of $2,000,000. 

  

	H.	The Company shall be permitted to carry excess of loss reinsurance applying to Workers’ Compensation risks in the State of Minnesota, actual recoveries under which
shall inure to the benefit of this Contract. Such coverage shall be provided through the Minnesota Workers’ Compensation Reinsurance Association. Notwithstanding the treatment of inuring coverage in the definition of Ultimate Net Loss, the
liability of the Reinsurer for Minnesota Workers’ Compensation risks is not released. 

 ARTICLE IX

 REINSTATEMENT 
  

	A.	Should all or any part of the Reinsurer’s limit of liability be exhausted as a result of a Loss Occurrence, the sum so exhausted shall be reinstated from the date
the Loss Occurrence commenced. 

  

	B.	For each amount so reinstated, the Company agrees to pay an additional premium at the time of the Reinsurer’s payment of the loss calculated in accordance with the
following formula: 

  

	 	1.	The percentage of the Reinsurer’s limit of liability exhausted for the Loss Occurrence; times 

 

	 	2.	The Net Earned Premium for the term of this Contract (exclusive of reinstatement premium). 

The dollar amount resulting from the multiplication of subparagraphs 1 and 2 above shall equal the reinstatement premium. If at the time
of the Reinsurer’s payment of a loss hereon, the reinsurance premium as calculated under this Contract is unknown, the calculation of the reinstatement premium shall be based upon the deposit premium subject to adjustment when the reinsurance
premium is finally established. 
  

	C.	Nevertheless, the Reinsurer’s liability hereunder shall not exceed $40,000,000 in respect of any one Loss Occurrence, and shall be further limited to $80,000,000
in respect of all losses occurring during the term of this Contract. 

 ARTICLE X 

SPECIAL ACCEPTANCE 
 From time to
time the Company may request a special acceptance applicable to this Contract. For purposes of this Contract, in the event each subscribing reinsurer whose share in the interests and liabilities of the Reinsurer is 20% or greater agree to a special
acceptance, such agreement shall be binding on all subscribing reinsurers. If such agreement is not achieved, such special 

  

					
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acceptance shall be made to this Contract only with respect to the interests and liabilities of each subscribing reinsurer who agrees to the special acceptance. Should denial for special
acceptance not be received within 10 working days of said request, the special acceptance shall be deemed automatically agreed. In the event a reinsurer becomes a party to this Contract subsequent to one or more special acceptances hereunder, the
new reinsurer shall automatically accept such special acceptance(s) as being covered hereunder. 
 ARTICLE XI

 ACCOUNTING BASIS 
 All premiums and losses under this Contract shall be reported on an “accident year” accounting basis. Unless specified otherwise herein, all premiums shall be credited to the period during which
they earn, and all losses shall be charged to the period during which they occur. 
 ARTICLE XII 

REINSURANCE PREMIUM 
  

	A.	As premium for the reinsurance provided hereunder, the Company shall pay the Reinsurer 0.4642% times its Net Earned Premium for the term of this Contract subject to a
Minimum Premium of $1,056,000. 

  

	B.	The Company shall pay the Reinsurer a Deposit Premium of $1,320,000 payable in quarterly installments on January 1, April 1, July 1 and
October 1. 

  

	C.	Within 90 days after the expiration of this Contract, the Company shall provide a report to the Reinsurer setting forth the premium due hereunder, computed in
accordance with paragraph A, and if the premium so computed is greater than the previously paid Deposit Premium, the balance shall be remitted by the Company with its report. 

 

	D.	If this Contract expires on a runoff basis, the Company shall pay to the Reinsurer a premium for the runoff period equal to the expiring rate times its Net Earned
Premium for the runoff period. The runoff premium shall be calculated and paid within 90 days after the end of each three-month period during the runoff period. There shall be no minimum premium requirement for the runoff period.

 ARTICLE XIII 
 NOTICE OF LOSS AND LOSS SETTLEMENTS 
  

	A.	As soon as practicable, the Company shall advise the Reinsurer of all bodily injury claims or losses involving any of the following: 

 

	 	1.	Any claim or loss reserved at 50.0% or more of the Company’s retention under this Contract. 

  

					
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	 	2.	Any claim involving any of the following injuries where the Company’s incurred loss is greater than or equal to $1,000,000: 

 

	 	a.	Fatality. 

  

	 	b.	Spinal cord injuries (e.g., quadriplegia, paraplegia). 

  

	 	c.	Brain damage (e.g., seizure, coma or physical/mental impairment). 

  

	 	d.	Severe burn injuries resulting in disfigurement or scarring. 

  

	 	e.	Total or partial blindness in one or both eyes. 

  

	 	f.	Major organ (e.g., heart, lungs). 

  

	 	g.	Amputation of a limb or multiple fractures. 

  

	B.	The Company shall also advise the Reinsurer promptly of all losses which, in the opinion of the Company, may result in a claim hereunder and of all subsequent
developments thereto which, in the opinion of the Company, may materially affect the position of the Reinsurer. 

  

	C.	When so requested in writing, the Company shall afford the Reinsurer or its representatives an opportunity to be associated with the Company, at the expense of the
Reinsurer, in the defense of any claim, suit or proceeding involving this reinsurance, and the Company and the Reinsurer shall cooperate in every respect in the defense of such claim, suit or proceeding. 

 

	D.	All loss settlements made by the Company that are within the terms and conditions of this Contract (including but not limited to ex gratia payments) shall be binding
upon the Reinsurer. Upon receipt of satisfactory proof of loss, the Reinsurer agrees to promptly pay or allow, as the case may be, its share of each such settlement in accordance with this Contract. 

ARTICLE XIV 

LIABILITY OF REINSURERS 
 All
reinsurances for which the Reinsurer shall be liable by virtue of this Contract shall be subject in all respects to the same rates, terms, conditions, interpretations and waivers and to the same modifications, alterations, and cancellations, as the
respective policies to which such reinsurances relate, the true intent of the parties to this Contract being that the Reinsurer shall follow the fortunes of the Company. 

  

					
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 ARTICLE XV 
 LATE PAYMENTS 
  

	A.	In the event any premium, loss or other payment due either party is not received by the Intermediary hereunder by the payment due date, the party to whom payment is due
may, by notifying the Intermediary in writing, require the debtor party to pay, and the debtor party agrees to pay, an interest penalty on the amount past due calculated for each such payment on the last business day of each month as follows:

  

	 	1.	The number of full days which have expired since the due date or the last monthly calculation, whichever the lesser; times 

 

	 	2.	1/365ths of a rate equal to the 90-day Treasury Bill rate as published in The Wall Street Journal on the first business day following the date a remittance
becomes due; times 

  

	 	3.	The amount past due, including accrued interest. 

 It is agreed that interest shall accumulate until payment of the original amount due plus interest penalties have been received by the Intermediary. 

 

	B.	The establishment of the due date shall, for purposes of this Article, be determined as follows: 

 

	 	1.	As respects the payment of deposits and premiums due the Reinsurer, the due date shall be as provided for in the applicable section of this Contract.

  

	 	2.	Any claim or loss payment due the Company hereunder shall be deemed due 10 business days after the proof of loss or demand for payment is transmitted to the Reinsurer.
If such loss or claim payment is not received within the10 days, interest will accrue on the payment or amount overdue in accordance with the interest penalty calculation above, from the date the proof of loss or demand for payment was transmitted
to the Reinsurer. 

  

	 	3.	As respects any payment, adjustment or return due either party not otherwise provided for in subparagraphs 1 and 2 of this paragraph, the due date shall be as provided
for in the applicable section of this Contract. 

  

	C.	For purposes of interest calculation only, amounts due hereunder shall be deemed paid upon receipt by the Intermediary. The validity of any claim or payment may be
contested under the provisions of this Contract. If the debtor party prevails in an arbitration, or any other proceeding, there shall be no interest penalty due. Otherwise, any interest will be calculated and due as outlined above.

  

	D.	Interest penalties arising out of the application of this Article that are $100 or less from any party shall be waived unless there is a pattern of late payments
consisting of three or more items over the course of any 12-month period. 

  

					
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 ARTICLE XVI 
 ANNUITIES AT THE COMPANY’S OPTION 
  

	A.	Whenever the Company is required, or elects, to purchase an annuity or to negotiate a structured settlement, either in satisfaction of a judgment or in an out-of-court
settlement or otherwise, the cost of the annuity or the structured settlement, as the case may be, shall be deemed part of the Company’s Ultimate Net Loss. 

 

	B.	The terms “annuity” or “structured settlement” shall be understood to mean any insurance policy, lump sum payment, agreement or device of whatever
nature resulting in the payment of a lump sum by the Company in settlement of any or all future liabilities which may attach to it as a result of an occurrence. 

 

	C.	In the event the Company purchases an annuity which inures in whole or in part to the benefit of the Reinsurer, it is understood that the liability of the Reinsurer is
not released thereby. In the event the Company is required to provide benefits not provided by the annuity for whatever reason, the Reinsurer shall pay its share of any loss. 

ARTICLE XVII 

AGENCY AGREEMENT 
 If more than
one reinsured company is named as a party to this Contract, the first named company will be deemed the agent of the other reinsured companies for purposes of sending or receiving notices required by the terms and conditions of this Contract and for
purposes of remitting or receiving any monies due any party. 
 ARTICLE XVIII 

SUBROGATION 
 The Reinsurer shall
be credited with subrogation recoveries (i.e., reimbursement obtained or recovery made by the Company, less Loss Adjustment Expense incurred in obtaining such reimbursement or making such recovery) on account of claims and settlements involving
reinsurance hereunder. Subrogation recoveries thereon shall always be used to reimburse the excess carriers in the reverse order of their priority according to their participation before being used in any way to reimburse the Company for its primary
loss. The Company, at its sole option and discretion, may enforce its rights to subrogation relating to any loss, a part of which loss was sustained by the Reinsurer, and may prosecute all claims arising out of such rights. 

ARTICLE XIX 

ERRORS AND OMISSIONS 
 Any
inadvertent delay, omission or error shall not be held to relieve either party hereto from any liability which would attach to it hereunder if such delay, omission or error had not been made, provided such omission or error is rectified upon
discovery. 

  

					
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 ARTICLE XX 
 OFFSET 
 The Company and the Reinsurer may offset any balance or amount due from one
party to the other under this Contract or any other contract heretofore or hereafter entered into between the Company and the Reinsurer, whether acting as assuming reinsurer or ceding company. The party asserting the right of offset may exercise
such right any time whether the balances due are on account of premiums or losses or otherwise. 
 ARTICLE XXI

 CURRENCY 
  

	A.	Whenever the word “Dollars” or the “$” sign appears in this Contract, they shall be construed to mean United States Dollars and all transactions
under this Contract shall be in United States Dollars. 

  

	B.	Amounts paid or received by the Company in any other currency shall be converted to United States Dollars at the rate of exchange at the date such transaction is
entered on the books of the Company. 

 ARTICLE XXII 

TAXES 
 In consideration of the
terms under which this Contract is issued, the Company will not claim a deduction in respect of the premium hereon when making tax returns, other than income or profits tax returns, to any state or territory of the United States of America, the
District of Columbia or Canada. 
 ARTICLE XXIII 
 FEDERAL EXCISE TAX 
 (Applicable to those subscribing reinsurers who are domiciled
outside the United States of America, excepting subscribing reinsurers exempt from Federal Excise Tax.) 
  

	A.	The subscribing reinsurer has agreed to allow for the purpose of paying the Federal Excise Tax the applicable percentage of the premium payable hereon (as imposed under
Section 4371 of the Internal Revenue Code) to the extent such premium is subject to the Federal Excise Tax. 

  

	B.	In the event of any return of premium becoming due hereunder the subscribing reinsurer will deduct the applicable percentage from the return premium payable hereon and
the Company or its agent should take steps to recover the tax from the United States Government. 

  

					
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 ARTICLE XXIV 
 RESERVES AND FUNDING 
  

	A.	A subscribing reinsurer will provide funding under the terms of this Article only if the Company will be denied statutory credit for reinsurance ceded to that
subscribing reinsurer pursuant to the credit for reinsurance law or regulations in any applicable jurisdiction. In the event any of the provisions of this Article conflict with or otherwise fail to satisfy the requirements of the appropriate credit
for reinsurance statute or regulation, this Article will be deemed amended to conform to the appropriate statute or regulation; the intent of this Article being that the Company will be permitted to realize full credit for the reinsurance ceded to
the Reinsurer under this Contract. 

  

	B.	As regards Policies or bonds issued by the Company coming within the scope of this Contract, the Company agrees that when it shall file with the insurance regulatory
authority or set up on its books reserves for 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 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 shown in the statement prepared by the Company (hereinafter referred to as
“subscribing reinsurer’s obligations”) by funds withheld, cash advances or a Letter of Credit. The subscribing reinsurer shall have the option of determining the method of funding provided it is acceptable to the Company and to the
insurance regulatory authorities having jurisdiction over the Company’s reserves. 

  

	C.	When funding by a Letter of Credit, the subscribing reinsurer agrees to apply for and secure timely delivery to the Company of a clean, irrevocable and unconditional
Letter of Credit issued by a bank and containing provisions acceptable to the insurance regulatory authorities having jurisdiction over the Company’s reserves in an amount equal to the subscribing reinsurer’s proportion of said reserves.
Such Letter of Credit shall be issued for a period of not less than one year, and shall be automatically extended for one year from its date of expiration or any future expiration date unless 30 days (60 days where required by insurance regulatory
authorities) prior to any expiration date the issuing bank shall notify the Company by certified or registered mail that the issuing bank elects not to consider the Letter of Credit extended for any additional period. 

 

	D.	The subscribing reinsurer and Company agree that the Letters of Credit provided by the subscribing reinsurer pursuant to the provisions of this Contract may be drawn
upon at any time, notwithstanding any other provision of this Contract, and be utilized by the Company or any successor, by operation of law, of the Company including, without limitation, any liquidator, rehabilitator, receiver or conservator of the
Company for the following purposes, unless otherwise provided for in a separate Trust Agreement: 

  

	 	1.	To reimburse the Company for the subscribing reinsurer’s obligations, the payment of which is due under the terms of this Contract and which has not been otherwise
paid; 

  

					
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	 	2.	To make refund of any sum which is in excess of the actual amount required to pay the subscribing reinsurer’s obligations under this Contract;

  

	 	3.	To fund an account with the Company for the subscribing reinsurer’s obligations. Such cash deposit shall be held in an interest bearing account separate from the
Company’s other assets, and interest thereon not in excess of the prime rate shall accrue to the benefit of the subscribing reinsurer; 

  

	 	4.	To pay the subscribing reinsurer’s share of any other amounts the Company claims are due under this Contract. 

In the event the amount drawn by the Company on any Letter of Credit is in excess of the actual amount required for subparagraph 1 or 3,
or in the case of subparagraph 4, the actual amount determined to be due, the Company shall promptly return to the subscribing reinsurer the excess amount so drawn. All of the foregoing shall be applied without diminution because of insolvency on
the part of the Company or the subscribing reinsurer. 
  

	E.	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. 

  

	F.	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 Letter of Credit, in the following manner: 

  

	 	1.	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 Letter of Credit increasing the amount of credit by the amount of such difference. 

 

	 	2.	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 Letter of Credit reducing the amount of credit available by the amount of such excess credit.

 ARTICLE XXV 
 NET RETAINED LINES 
  

	A.	This Contract applies only to that portion of any Policy which the Company retains net for its own account (prior to deduction of any underlying reinsurance
specifically permitted in this Contract), and in calculating the amount of any loss hereunder and also in computing the amount or amounts in excess of which this Contract attaches, only loss or losses in respect of that portion of any Policy which
the Company retains net for its own account shall be included. 

  

					
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	B.	The amount of the Reinsurer’s liability hereunder in respect of any loss or losses shall not be increased by reason of the inability of the Company to collect from
any other reinsurer(s), whether specific or general, any amounts which may have become due from such reinsurer(s), whether such inability arises from the insolvency of such other reinsurer(s) or otherwise. 

ARTICLE XXVI 

THIRD PARTY RIGHTS 
 This Contract
is solely between the Company and the Reinsurer, and in no instance shall any other party have any rights under this Contract except as expressly provided otherwise in the INSOLVENCY ARTICLE. 

ARTICLE XXVII 

SEVERABILITY 
 If any provision of
this Contract shall be rendered illegal or unenforceable by the laws or regulations 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 Contract
or the enforceability of such provision in any other jurisdiction. 
 ARTICLE XXVIII 

GOVERNING LAW 
 This Contract
shall be governed as to performance, administration and interpretation by the laws of the State of Louisiana, exclusive of that state’s rules with respect to conflicts of law, except as to rules with respect to credit for reinsurance in which
case the applicable rules of all states shall apply. 
 ARTICLE XXIX 

INSPECTION OF RECORDS 
  

	A.	The Reinsurer or its designated representative(s) approved by the Company, upon providing reasonable advance notice to the Company, shall have access at the offices of
the Company or at a location to be mutually agreed, at a time to be mutually agreed, to inspect the Company’s underwriting, accounting, or claim files pertaining to the subject matter of this Contract. The Company shall determine the manner in
which files shall be accessed by the Reinsurer. The Reinsurer may, at its own expense, reasonably request copies of such files and agrees to pay the Company’s reasonable costs incurred in procuring such copies. 

 

	B.	If any undisputed amounts are overdue from the Reinsurer to the Company, the Reinsurer shall have access to such records only upon payment of all such overdue amounts.

  

					
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	C.	If the Reinsurer makes any inspection of the Company’s books and records involving specific claims under this Contract and, as a result of the inspection the claim
is contested or disputed, the Reinsurer shall provide the Company, at the Company’s request, a summary of any reports, other than proprietary information or privileged communications, completed by the Reinsurer’s personnel or by third
parties on behalf of the Reinsurer outlining the reasons for contesting or disputing the subject claim. 

ARTICLE XXX 

CONFIDENTIALITY 
  

	A.	The Reinsurer hereby acknowledges that the documents, information, and data provided to the Reinsurer by the Company, whether directly or through an authorized agent,
in connection with the placement and execution of this Contract (“Confidential Information”) are proprietary and confidential to the Company. 

  

	B.	Absent the written consent of the Company, the Reinsurer will not disclose any Confidential Information to any third parties, except when: 

 

	 	1.	The disclosure is to professional advisors or to authorized agents of the Reinsurer performing underwriting, claim handling, pricing, placement and/or evaluation
services for the Reinsurer; or 

  

	 	2.	The Confidential Information is publicly known or has become publicly known through no unauthorized act of the Reinsurer; or 

 

	 	3.	Required by retrocessionaires subject to the business ceded to this Contract; or 

 

	 	4.	Required by state regulators performing an audit of the Reinsurer’s records and/or financial condition; or 

 

	 	5.	Required by auditors performing an audit of the Reinsurer’s records in the normal course of business. 

 

	C.	Further, the Reinsurer agrees not to use any Confidential Information for any purpose not permitted by this Contract or not related to the performance of their
obligations or enforcement of their rights under this Contract. 

  

	D.	Notwithstanding the above, in the event that the Reinsurer is required by court order, other legal process, or any regulatory authority to release or disclose any or
all of the Confidential Information, the Reinsurer agrees to provide the Company by written or electronic mail, reasonable advance notice of same prior to such release or disclosure and to use their reasonable best efforts to assist the Company in
maintaining the confidentiality provided for in this Article. 

  

	E.	The provisions of this Article will extend to the officers, directors, shareholders, and employees of the Reinsurer and its affiliates, who have received Confidential
Information in accordance with this Contract and will be binding upon their successors and assigns. 

  

					
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 ARTICLE XXXI 
 SUNSET AND COMMUTATION 
  

	A.	Ten years after the expiration of this Contract, the Company shall advise the Reinsurer of any Loss Occurrences attaching to this Contract which have not been finally
settled and which may result in a claim by the Company under this Contract. No liability shall attach hereunder for any claim or claims not reported to the Reinsurer within this ten year period. If a loss arising out of a Loss Occurrence is reported
during this period, all losses arising out of the same Loss Occurrence shall be deemed reported under this paragraph regardless of when notification of loss is provided. 

 

	B.	If both parties agree to commute the unsettled losses subject to the Contract, then the Reinsurer’s liability for all such unsettled losses shall then be commuted.

  

	C.	It is understood that commutation of all such losses shall be made using tabular reserving methods. For each loss, the nominal ultimate value of the Company’s
Ultimate Net Loss shall be established by projecting out future medical and indemnity payments and loss expenses by year based on appropriate trends and escalations applied to annual cost estimates. The Contract limit and retention (where
applicable) shall then be applied to the nominal ultimate value of the Company’s Ultimate Net Loss to determine the nominal ultimate Contract loss. Mortality factors and discount factors shall then be applied by year to the nominal ultimate
Contract loss. The discounted, mortality adjusted projected annual loss payments shall be summed to determine the present value (“commutation price”) of the ultimate Contract loss. The medical escalation, discount and mortality factors are
described in paragraph C. 

  

	D.	The following factors shall be utilized in establishing the commutation price: 

 

	 	1.	Medical Escalation Rate 

 The
medical escalation rate shall be a reasonable estimate of future medical inflation. 
  

	 	2.	Discount Rate 

 The discount rate
shall be the annualized 10-year US Treasury Bill rate at the Valuation Date. 
  

	 	3.	Mortality Tables 

 Mortality
factors shall be based on the most recent mortality table at the Valuation Date from the “Vital Statistics of the United States” as published by the US Department of Health and Human Services, Center for Disease Control and Prevention.
Factors for extension beyond age 85 shall also be included. 
  

	 	4.	Impairment 

 Impairment factors
shall be based on the individual claim characteristics. 

  

					
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 Any other method of calculating the commutation price of one or more losses subject to this
Contract may be used as mutually agreed between the Company and the Reinsurer. 
  

	E.	If the Company and the Reinsurer cannot agree on a commutation value, the effort can be abandoned. Alternatively, the Company and the Reinsurer may mutually agree to
settle any difference using a panel of three actuaries, one to be chosen by each party and the third by the two so chosen. If either party refuses or neglects to appoint an actuary within 30 days, the other party may appoint two actuaries. If the
two actuaries fail to agree on the selection of a third actuary within 30 days of their appointment, each of them shall name two, of whom the other shall decline one and the decision shall be made by drawing lots. All the actuaries shall be
regularly engaged in the valuation of Workers’ Compensation claims and shall be Fellows of the Casualty Actuarial Society or members of the American Academy of Actuaries. All of the actuaries shall be independent of either party to this
Contract. 

  

	F.	The settlement agreed upon by a majority of the panel of actuaries shall be final and binding on both parties and set forth in a sworn written document expressing their
professional opinion that said value is fair for the complete mutual release of all liabilities in respect of such reserves. 

  

	G.	The Reinsurer’s commutation payment shall be due within 7 days following the date the Company and the Reinsurer agree to the commutation price. Such payment by the
Reinsurer shall constitute both a complete release of the Reinsurer of its liability for all losses, known or unknown, under this Contract, and a complete release of the Company of its liabilities and obligations, known or unknown, under this
Contract. 

  

	H.	This Article shall survive the expiration of this Contract. 

 ARTICLE XXXII 
 INSOLVENCY 

 

	A.	In the event of the insolvency of the Company, this reinsurance shall be payable directly to the Company or to its liquidator, receiver, conservator or statutory
successor, with reasonable provision for verification, on the basis of the liability of the Company without diminution because of the insolvency of the Company or because the liquidator, receiver, conservator or statutory successor of the Company
has failed to pay all or a portion of any claim. It is agreed, however, that the liquidator, receiver, conservator or statutory successor of the Company shall give written notice to the Reinsurer of the pendency of a claim against the Company
indicating the Policy or bond reinsured which claim would involve a possible liability on the part of the Reinsurer within a reasonable time after such claim is filed in the conservation or liquidation proceeding or in the receivership, and that
during the pendency of such claim, the 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 that it may deem available to the Company or its
liquidator, receiver, conservator or statutory successor. The expense thus incurred by the Reinsurer shall be chargeable, subject to the approval of the Court, against the Company as part of the expense of conservation or 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 Reinsurer. 

  

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

  

	C.	It is further agreed that, in the event of the insolvency of the Company, the reinsurance under this Contract shall be payable directly by the Reinsurer to the Company
or its liquidator, receiver, conservator, or statutory successor, except as provided by Section 4118(a) of the New York Insurance Law or except 1) where this Contract specifically provides another payee of such reinsurance in the event of the
insolvency of the Company or 2) where the Reinsurer with the consent of the direct insured or insureds has assumed such Policy obligations of the Company as direct obligations of the Reinsurer to the payee under such Policies and in substitution for
the obligations of the Company to such payees. 

  

	D.	In the event of the insolvency of any company or companies listed in the designation of “Company” under this Contract, this Article shall apply only to the
insolvent company or companies. 

 ARTICLE XXXIII 

ARBITRATION 
  

	A.	As a condition precedent to any right of action hereunder, any irreconcilable dispute arising out of the interpretation, performance or breach of this Contract,
including the formation or validity thereof, whether arising before or after the expiry or termination of the Contract, shall be submitted for decision to a panel of 3 arbitrators. Notice requesting arbitration will be in writing and sent by
certified mail, return receipt requested, or such reputable courier service as is capable of returning proof of receipt of such notice by the recipient to the party demanding arbitration. 

 

	B.	The Company shall have the option to either litigate or arbitrate where: 

  

	 	1.	The Reinsurer makes any allegation of misrepresentation, non-disclosure, concealment, fraud or bad faith; or 

 

	 	2.	The Reinsurer experiences any of the circumstances set forth in subparagraphs 1 through 7 of paragraph A of the SPECIAL TERMINATION ARTICLE. 

 

	C.	One arbitrator shall be appointed by each party. If either party fails to appoint its arbitrator within 30 days after being requested to do so by the other party, the
latter, after 10 days notice by certified mail or reputable courier as provided above of its intention to do so, may appoint the second arbitrator. 

  

	D.	The two arbitrators shall, before instituting the hearing, appoint an impartial third arbitrator who shall preside at the hearing. Should the two arbitrators fail to
choose the third arbitrator within 30 days of the appointment of the second arbitrator, the parties shall appoint the third arbitrator pursuant to the AIDA Reinsurance and Insurance Arbitration Society – U.S. (ARIAS) Umpire Selection Procedure.
All arbitrators shall be disinterested active or former senior executives of insurance or reinsurance companies or Underwriters at Lloyd’s, London. 

  

					
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	E.	Within 30 days after notice of appointment of all arbitrators, the panel shall meet and determine timely periods for briefs, discovery procedures and schedules for
hearings. The panel shall be relieved of all judicial formality and shall not be bound by the strict rules of procedure and evidence. Unless the panel agrees otherwise, arbitration shall take place in DeRidder, Louisiana but the venue may be changed
when deemed by the panel to be in the best interest of the arbitration proceeding. Insofar as the arbitration panel looks to substantive law, it shall consider the law of the State of Louisiana. The decision of any 2 arbitrators when rendered in
writing shall be final and binding. The panel is empowered to grant interim relief as it may deem appropriate. 

  

	F.	In the event an arbitrator is unable to serve due to death, disability or other incapacity, a replacement arbitrator shall be chosen in accordance with the procedures
set forth in this Article for the original selection of the arbitrator. 

  

	G.	The panel shall make its decision considering the custom and practice of the applicable insurance and reinsurance business as promptly as possible following the
termination of the hearings. Judgment upon the award may be entered in any court having jurisdiction thereof. 

  

	H.	If more than one subscribing reinsurer is involved in arbitration where there are common questions of law or fact and a possibility of conflicting awards or
inconsistent results, all such subscribing 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 subscribing reinsurers constituting the one party; provided,
however, that nothing therein shall impair the rights of such subscribing reinsurers to assert several, rather than joint defenses or claims, nor be construed as changing the liability of the subscribing reinsurers under the terms of this Contract
from several to joint. 

  

	I.	Each party shall bear the expense of its own arbitrator and shall jointly and equally bear with the other party the cost of the third arbitrator. The remaining costs of
the arbitration shall be allocated by the panel. The panel may, at its discretion, award such further costs and expenses as it considers appropriate, including but not limited to attorneys fees, to the extent permitted by law. However, the panel may
not award any Exemplary or Punitive Damages and Enhanced Compensatory Damages. 

 ARTICLE XXXIV

 SERVICE OF SUIT 

(This Article is applicable if the subscribing reinsurer is not domiciled in the United States of America and/or is not authorized in any State, Territory
or District of the United States where authorization is required by insurance regulatory authorities. This Article is not intended to conflict with or override the obligation of the parties to arbitrate their disputes in accordance with the
ARBITRATION ARTICLE.) 

  

					
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	A.	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, shall
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 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. The
subscribing reinsurer, once the appropriate court is selected, whether such court is the one originally chosen by the Company and accepted by subscribing reinsurer or is determined by removal, transfer, or otherwise, as provided for above, shall
comply with all requirements necessary to give said court jurisdiction and, in any suit instituted against it upon this Contract, and shall abide by the final decision of such court or of any appellate court in the event of an appeal.

  

	B.	Service of process in such suit may be made upon the agent for the service of process (“agent”) named below, depending on the jurisdiction where the Company
chooses to bring suit: 

  

	 	1.	 If the suit is brought in the State of California, the law firm of Mendes and Mount, 445 South Figueroa Street, 38th Floor, Los Angeles, California 90071 shall be authorized and
directed to accept service of process on behalf of the subscribing reinsurer in any such suit; 

  

	 	2.	If the suit is brought in the State of New York, the law firm of Mendes and Mount, 750 Seventh Avenue, New York, New York 10019 shall be authorized and directed to
accept service of process on behalf of the subscribing reinsurer in any such suit; 

  

	 	3.	If the suit is brought in any state other than California or New York, either of the agents described in subparagraphs 1 or 2 above shall be authorized and directed to
accept service of process on behalf of the subscribing reinsurer in any such suit; or 

  

	 	4.	If the subscribing reinsurer has designated an agent in the subscribing reinsurer’s Interests and Liabilities Agreement attached hereto, then that agent shall be
authorized and directed to accept service of process on behalf of the subscribing reinsurer in any suit. However, if an agent is designated in the subscribing reinsurer’s Interests and Liabilities Agreement and the agent is not located in
California as respects a suit brought in California or New York as respects a suit brought in New York, in keeping with the laws of the states of California and New York which require that service be made on an agent located in the respective state
if a suit is brought in that state, the applicable office of Mendes and Mount stipulated in subparagraphs 1 and 2 above must be used for service of suit unless the provisions of paragraph C of this Article apply. 

 

	C.	Further, pursuant to any statute of any state, territory or district of the United States that makes provision therefor, the subscribing reinsurer hereby designates 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 its 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 Contract, and hereby designates the above-named as the person to whom the said officer is authorized to mail such process or a true copy
thereof. 

  

					
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 ARTICLE XXXV 
 ENTIRE AGREEMENT 
 This Contract shall constitute the entire agreement between the
parties with respect to the business being reinsured hereunder. There are no understandings between the parties other than as expressed in this Contract. Any change or modification to this Contract shall be null and void unless made by amendment to
this Contract and signed by both parties. This Article shall not be construed as limiting in any way the admissibility in the context of an arbitration or any other legal proceeding, evidence regarding the formation, interpretation, purpose or
intent of this Contract. 
 ARTICLE XXXVI 
 MODE OF EXECUTION 
 This Contract may be executed either by an original written ink
signature of paper documents, by an exchange of facsimile copies showing the original written ink signature of paper documents, or by electronic signature by either party employing appropriate software technology as to satisfy the parties at the
time of execution that the version of the document agreed to by each party shall always be capable of authentication and satisfy the same rules of evidence as written signatures. The use of any one or a combination of these methods of execution
shall constitute a legally binding and valid signing of this Contract. This Contract may be executed in one or more counterparts, each of which, when duly executed, shall be deemed an original. 

ARTICLE XXXVII 

INTERMEDIARY 
 Willis Re Inc.,
15305 North Dallas Parkway, Suite 1100, Colonnade III, Addison, Texas 75001 is hereby recognized as the intermediary negotiating this Contract and through whom all communications relating thereto shall be transmitted to the Company or the Reinsurer.
However, all communications concerning accounts, claim information, funds and inquiries related thereto shall be transmitted to the Company or the Reinsurer through Willis Re Inc., 5420 Millstream Road, Suite 200, McLeansville, North Carolina 27301.
Payments by the Company to Willis Re Inc. shall be deemed to constitute payment to the Reinsurer and payments by the Reinsurer to Willis Re Inc. shall be deemed to constitute payment to the Company only to the extent that such payments are actually
received by the Company. 

  

					
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 IN WITNESS WHEREOF, the Company by its duly authorized representative has executed this Contract as
of the date specified below: 
 Signed this 12th day of January, 2012. 
 AMERICAN INTERSTATE INSURANCE COMPANY 
 AMERICAN INTERSTATE INSURANCE COMPANY OF TEXAS

			
	SILVER OAK CASUALTY, INC.
		
	By	 	/s/ Allan E. Farr
	Printed Name	 	Allan E. Farr
	Title	 	Senior VP

  

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

 (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 of 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 Liability
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, 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 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; 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 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 

  

					
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(c)        the        (injury, sickness, disease, death
or destruction 

                       
   (bodily injury or property damages 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 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”  

                       
 (“property damage” includes all forms of radioactive contamination of property  

                       
 (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 operation 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 of the Independent Insurance Conference of Canada. 

 

	*	NOTE: The words printed in italics 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. 

 21/9/67 

N.M.A. 1590 
 BRMA 35A 

  

					
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