REINSURANCE COVER NOTE
Agreement No. BN970046
MEMORANDUM OF REINSURANCE ISSUED ON BEHALF OF:
REINSURED: HOME STATE INSURANCE GROUP
- ---------
NEW YORK MERCHANT BAKERS INSURANCE COMPANY
Binghamton, New York
HOME MUTUAL INSURANCE COMPANY OF BINGHAMTON, NEW YORK
Binghamton, New York
(hereinafter referred to as the "Company")
TYPE: PROPERTY CATASTROPHE
- ---- EXCESS OF LOSS REINSURANCE AGREEMENT
PERIOD: Losses occurring during the period January 1, 1997 to
- ------ December 31, 1997, both days inclusive.
Should this Agreement terminate while a loss occurrence is
in progress, the Reinsurers shall be liable for their share
of all individual losses resulting from such loss
occurrences whether any such individual losses take place
before or after such termination.
CLASS: All in-force, new and renewal business classified by the
- ----- Company as Automobile Physical Damage and Property
business.
EXCLUSIONS: This Agreement shall not apply to:
- ----------
1. Bodily Injury and Property Damage Liability including
Personal Injury Liability and Medical Payments.
2. Personal Accident and Health.
3. Assumed reinsurance other than business assumed via
intra-company reinsurance and from United Pacific
Insurance Company for the Dave, Inc. policy.
4. Loss or liability excluded by the provisions of the
"Nuclear Incident Exclusion Clause - Physical Damage -
Reinsurance."
5. Financial Guarantee and Insolvency.
6. Insolvency Funds.
7. War Risks as described in the North American War Risk
Exclusion Clause.
8. Loss or liability as excluded by the provisions of the
"Pools Exclusions Clause." It is understood and agreed
that this exclusion shall not apply to individual
risks assigned to the Company under an "Assigned Risk"
plan.
9. Seepage and Pollution.
10. Transmission and Distribution Lines.
11. Extra Contractual Obligations and Losses in Excess of
Policy Limits.
TERRITORY: As per the Company's original policies.
- ---------
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1/7/97
REINSURANCE COVER NOTE
Agreement No. BN970046
LIMIT AND
RETENTION: $500,000 Ultimate Net Loss each and every loss occurrence
- --------- in excess of $500,000 Ultimate Net Loss each and every loss
occurrence.
REINSTATEMENT: One reinstatement of limit for all perils at pro rata
- ------------- additional premium as to amount and 100% as to time.
Simultaneous settlement of reinstatement premium with loss
payment.
RATE: 1.305% of the Company's gross net earned premium income,
- ---- estimated to be $8,230,000 for 1997.
DEPOSIT
PREMIUM: $107,500 payable in four equal quarterly installments of
- ------- $26,875 each at January 1, April 1, July 1 and October 1,
1997.
The New York Pool consists of: New York Merchant Bakers
Insurance Company (85%); Home Mutual Insurance Company of
Binghamton, New York (15%).
MINIMUM
PREMIUM: $86,000 annually.
- -------
WARRANTY: The Company agrees to carry at its own risk and not
- -------- reinsured in any way the remaining 5% of each excess net
loss for which claim is made on the reinsurance limits
specified herein.
CLAUSES: Parties to the Agreement.
- ------- Net Retained Lines.
Ultimate Net Loss - loss adjustment expensed included.
Subrogation.
Salvage and Recoveries.
Underlying Excess.
Definition of Loss Occurrence to follow Lloyd's NMA 2244-
Amended; no reinstatement in the same event.
Loss Notice and Settlement.
Funding of Reserves.
Offset
Original Conditions.
Currency.
Taxes.
Federal Excise Tax.
Errors and Omissions.
Access to Records.
Service of Suit - NMA 1998 - Mendes and Mount (where
applicable).
Arbitration.
Insolvency.
Minet Re North America, Inc. Intermediary.
MMW 2
1/7/97
REINSURANCE COVER NOTE
Agreement No. BN970046
WORDING: As per expiring Reinsurance Agreement as far as applicable
- ------- and as noted herein, which complies with the requirements
of the State of New York Insurance Department.
Reinsurers Effective January 1, 1997:
- ------------------------------------
% FEIN NAIC
- ---- ----
Through Swire Fraser Insurance Brokers Limited:
----------------------------------------------
Underwriting Members of Lloyd's 78.334% AA-1122000
London, England (as per Schedule)
The Copenhagen Reinsurance Company 3.333%
(UK) Limited, London, England AA-1120440
Terra Nova Insurance Company Limited, 13.333%
London, England ------- AA-1121425
Placement Total: 95.000%
=======
We will periodically provide a list of those companies with which Minet Re North
America, Inc. is affiliated, which may be parties to this placement. This list
is available on request.
For and on behalf of:
MINET RE NORTH AMERICA, INC.
-------------------------
Senior Vice President
HOME STATE INSURANCE GROUP
NEW YORK MERCHANT BAKERS INSURANCE COMPANY
HOME MUTUAL INSURANCE COMPANY OF BINGHAMTON, NEW YORK
- -------------------------------
Authorized Signature
- -------------------------------
Date
Please examine this document carefully and advise us immediately if any of the
details or the security used are not in accordance with your order or
requirements.
MMW 3
1/7/97
REINSURANCE COVER NOTE
Agreement No. BN970046
SCHEDULE OF
UNDERWRITING MEMBERS OF LLOYD'S PARTICIPATION
PROPERTY CATASTROPHE
EXCESS OF LOSS REINSURANCE AGREEMENT
------------------------------------
(BN970046)
Syndicate Pseudonym ACIN Share
--------- --------- ---- -----
435 DPM AA-1126435 9.999%
566 STN AA-1126566 6.667%
623 AFB AA-1126623 6.667%
780 BFC AA-1126780 6.667%
382 PWH AA-1126382 15.667%
40 KJC AA-1126040 8.333%
1028 HRD AA-1127028 6.667%
958 GSC AA-1126958 10.000%
219 RAE AA-1126219 6.667%
------
Total Participation 78.334%
-------
through the
Underwriting Members of Lloyd's, London
MMW
1/7/97