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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 1, 1996
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UNITED INSURANCE COMPANIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-14320 75-2044750
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
4001 McEwen Drive, Suite 200, Dallas, Texas 75244
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (214) 960-8497
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Not Applicable
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Item 5.OTHER EVENTS
Since United Insurance Companies, Inc.'s (the "Company") inception, a
substantial portion of the health insurance policies sold by United Group
Association, Inc. ("UGA") agents has been issued by AEGON USA, Inc. (together
with its subsidiaries, "AEGON") and coinsured by the Company. Effective April
1, 1996, substantially all new health insurance policies sold by UGA will be
directly issued by the Company, following a transition period, pursuant to
agreements between the Company and AEGON (the "AEGON Transaction"). The
Company will retain 100% of the premiums and pay all of the costs of such new
policies. During the transition period, UGA agents will continue to sell
health insurance policies issued by AEGON and coinsured by the Company in each
state where UGA sells insurance until regulatory approvals for the Company to
directly issue its policies in such state are received. The Company believes
that substantially all regulatory approvals will be obtained by December 31,
1996. The Company and AEGON will maintain the coinsurance agreement for
policies issued by AEGON prior to April 1, 1996 and during the transition
period. The Company's coinsurance percentage will be 57.5% in 1996 and 60%
thereafter until December 31, 2000, at which time the Company will acquire all
remaining policies from AEGON at a formula price described in the agreement.
As part of the AEGON Transaction, the Company acquired AEGON's
underwriting, claims management and administrative capabilities related to the
products coinsured by the Company, through the purchase of AEGON's insurance
center for approximately $10 million. The Company also hired substantially all
of the 700 employees located at the center. The Company believes that this
will ensure a continuation of the quality, cost effective underwriting, claims
processing and customer service expertise that has contributed to the
profitability of the business sold by UGA.
Under general agency agreements effective April 1, 1996, UGA will sell
insurance directly issued by the Company. The agreements are terminable by
either party at any time on 15 months' written notice or immediately for cause
(as defined). Commissions will be agreed upon by the parties from time to time
under the agreements. UGA has agreed that until such agreements are
terminated, UGA will not market, and will use its reasonable efforts to prevent
UGA agents from marketing, insurance products of other insurance carriers that
are competitive with the Company's insurance products, unless the Company has
declined to market such products.
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Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL AND EXHIBITS
Exhibit Page
Number Description of Exhibit Number
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10.1 Reinsurance Agreement between AEGON USA Companies and UICI
Companies effective January 1, 1995, as amended through April 1,
1996.
10.2 Asset Purchase Agreement between UICI Companies and PFL Life
Insurance Company, Bankers United Life Assurance Company, Life
Investors Insurance Company of America and Monumental Life
Insurance Company and Money Services, Inc. effective April 1,
1996.
10.3 General Agent's Agreement between Mid-West National Life
Insurance Company of Tennessee and United Group Association,
Inc. effective April 1, 1996.
10.4 General Agent's Agreement between The MEGA Life and Health
Insurance Company and United Group Association, Inc. effective
April 1, 1996.
10.5 Agreement between United Group Association, Inc. and Cornerstone
Marketing of America effective April 1, 1996.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
UNITED INSURANCE COMPANIES, INC.
(Registrant)
Date April 1, 1996 By /s/ W. Brian Harrigan
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W. Brian Harrigan
President and Director
Date April 1, 1996 By /s/ Vernon R. Woelke
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Vernon R. Woelke
Vice President, Treasurer and
Director
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EXHIBIT INDEX
Exhibit
Number Description of Exhibit
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10.1 Reinsurance Agreement between AEGON USA Companies and UICI
Companies effective January 1, 1995, as amended through April 1,
1996.
10.2 Asset Purchase Agreement between UICI Companies and PFL Life
Insurance Company, Bankers United Life Assurance Company, Life
Investors Insurance Company of America and Monumental Life
Insurance Company and Money Services, Inc. effective April 1,
1996.
10.3 General Agent's Agreement between Mid-West National Life
Insurance Company of Tennessee and United Group Association,
Inc. effective April 1, 1996.
10.4 General Agent's Agreement between The MEGA Life and Health
Insurance Company and United Group Association, Inc. effective
April 1, 1996.
10.5 Agreement between United Group Association, Inc. and Cornerstone
Marketing of America effective April 1, 1996.