EXHIBIT 10.28
EXCESS DEDUCTIBLE INDEMNITY AGREEMENT
DECLARATIONS
ITEM 1. COMPANY: Reliance Insurance Company of Illinois
ITEM 2. INSURED: The Vincam Group, Inc. and other insureds as per
attached Additional Named Insureds Endorsement.
ITEM 3. EFFECTIVE DATE: 12/31/96 -
12/30/99
ITEM 4. PREMIUM: Deposit Premium for 12/31/96-97 shall be $4,422,600.
Deposit Premium for 12/31/97-99 shall be determined by
the Company.
ITEM 5. COVERED POLICY:
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POLICY POLICY POLICY POLICY DEDUCTIBLE
INSURER COVERAGE TYPE NUMBER PERIOD AMOUNT
------- -------- ------ ------ ------ ----------
- ------------------------------------------------------------------------
Liberty Mutual Workers' Deduct. $500,000
Insurance Comp.
Company
ITEM 6. COMPANY'S LIMIT OF LIABILITY FOR EACH COVERED POLICY:
Excess Deductible Amounts of $500,000 for each occurrence for indemnity claims
in excess of an underlying Aggregate Deductible Limit of $4,100,959, including
all Allocated Loss Adjustment Expenses.
ITEM 7. MEDICAL ONLY PER OCCURRENCE RETENTION FOR EACH COVERED POLICY:
$2,000 each and every Medical Only Claim
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EXCESS DEDUCTIBLE INDEMNITY AGREEMENT
-------------------------------------
In consideration of the payment of the premium and in reliance upon the
statements made to the Company, and subject to the Medical Only Per Occurrence
Retention and the Limit of Liability, and the limitations, exclusions, terms and
conditions of this Agreement, the Company agrees with the Insured as follows:
I. DEFINITIONS
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A. AGGREGATE DEDUCTIBLE LIMIT
--------------------------
"Aggregate Deductible Limit" means the total aggregate amount of
Deductible Amounts for which Commercial Risk Re-Insurance Company
shall be liable in the amount of $4,100,959 pursuant to the
Deductible Payment Loss Portfolio Transfer Insurance Policy
effective December 31, 1996.
B. INSURED
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"Insured" means the Insureds designated in the Declarations.
C. COMPANY
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"Company" means Reliance Insurance Company of Illinois.
D. INSURER
-------
"Insurer" means an insurance company that issued a Covered Policy
as listed in Item 5 of the Declarations.
E. AGREEMENT
---------
"Agreement" means this Excess Deductible Indemnity Agreement.
F. RETROSPECTIVE COVERAGE PERIOD
-----------------------------
The Retrospective Coverage Period shall include the period from
and including January 1, 1994 through and including December 31,
1996, provided, however, that losses for which coverage is sought
hereunder are payable on or after December 31,1996.
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G. BUSINESS COVERED
----------------
Business with respect to U.S. situated risks of the Insured only
classified as worker's' compensation under the covered Policy as
set forth in Item 5 hereunder.
H. EXCESS DEDUCTIBLE AMOUNTS
-------------------------
"Excess Deductible Amounts" means any amounts actually paid by an
Insurer with respect to a claim under a Covered Policy and for
which an Insured is responsible for reimbursing the Insurer under
the terms of any deductible provision or endorsement of a Covered
Policy in excess of the underlying Aggregate Deductible Limit of
$4,100,959, including all Allocated Loss Adjustment Expenses.
Such Excess Deductible Amounts may include but are not limited to
damages, benefits, losses, or costs, fees and expenses for
investigation, negotiation, settlement or defense. "Excess
Deductible Amounts" shall not include any premium taxes,
surcharges or assessments arising out of or attributable to an
Insured's obligations to reimburse an Insurer whether the Insured
is required to pay the Insurer for such premium taxes, surcharges
or assessments under the Covered Policy or otherwise.
In no event will the Company be liable to indemnify the Insured
for any Excess Deductible Amounts within the underlying Aggregate
Deductible Limit of $4,100,959.
II. INSURING AGREEMENTS
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A. COVERAGE
--------
The Company, subject to the Medical Only Per Occurrence Retention
and as described in E below will pay on behalf of the Insured all
Excess Deductible Amounts which the Insured shall become
obligated to pay up to the Limit of Liability as described in D
below to an Insurer under a Covered Policy listed in Item 5 of
the Declarations.
B. NO DUTY TO DEFEND
-----------------
The Company shall have no duty to investigate or defend any
claim, suit or proceeding commenced against the Insured under
this Agreement or any Covered Policy. The Company shall have the
right to associate, at its own expense, with the Insured in the
defense or investigation of any claim, suit or proceeding
involving the Covered Policy listed in Item 5 of the
Declarations.
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C. PAYMENTS TO INSURER LISTED IN DECLARATIONS
------------------------------------------
All Excess Deductible Amounts payable under this Agreement shall
be paid on behalf of the Insured directly to the Insurer on the
Covered Policy listed in Item 5 of the Declarations. The payment
of such Excess Deductible Amounts shall be made in satisfaction
of the Insured's obligations to such Insurer under the Covered
Policy. The Insured irrevocably waives any rights to such
payments.
D. LIMIT OF LIABILITY
------------------
The amount stated in Item 6 for each Covered Policies is the most
the Company will pay for Excess Deductible Amounts under each
Covered Policy for each occurrence.
E. MEDICAL ONLY PER OCCURRENCE RETENTION
-------------------------------------
The Company will not pay any Excess Deductible Amounts within the
Medical Only Per Occurrence Retention stated in Item 7 of the
Declarations for each Covered Policy. The Company shall have no
liability whatsoever hereunder with respect to any occurrence
covered by this Agreement until the Insured shall have paid the
Insured's Medical Only Per Occurrence Retention of $2,000.
III. EXCLUSIONS
----------
The Insurance under this Agreement covers only those Excess Deductible
Amounts which the Insured shall become obligated to pay to an Insurer
under the deductible endorsement to a Covered Policy listed in Item 5 of
the Declarations. Any Excess Deductible Amounts not covered or excluded
under a Covered Policy shall not be covered under this Agreement and the
Company shall have no liability to pay such Excess Deductible Amounts on
behalf of the Insured.
IV. CONDITIONS
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A. NOTICE OF CLAIM
---------------
The Insured shall provide the Company with a copy of any and all
notices and information on claims made under a Covered Policy.
The Insured shall provide the Company with a copy of any such
notices or information at the same time that it provides such
notices or information to an Insurer.
In addition, the Insured shall notify the Company in writing a
soon as practicable of any claim for reimbursement of any amounts
within the deductible provision by the Insurer under a Covered
Policy. The notice shall include: (1) the name of the Insurer,
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(2) the amount(s) sought by the Insurer, (3) the amount(s) paid
or reserved by the Insurer for such claim, suit or proceeding,
including indemnities, medical expenses or benefits, and
allocated loss adjustment expense, (4) the amount of the
deductible, if any, applicable to such claim, suit or proceeding,
(5) the Insurer's claim number, (6) the claimant's name and
address, (7) the date of accident or occurrence that is the basis
for such claim, suit or proceeding and (8) any other relevant
information requested by the Company. The Insured shall cooperate
with the Company in the investigation and settlement of any claim
under this Agreement.
B. COMMUTATION
-----------
The Insured, upon 30 days prior written notice to the Company,
may elect at any time to assume all of the Company's liabilities
under this Agreement, in consideration of a payment as mutually
agreed between the Company and Insured (the "Commutation").
C. FALSE OF FRAUDULENT CLAIMS
--------------------------
If the Insured submits any claim that the Insured knows is false
or fraudulent, in whole or part, as regards amount of otherwise,
this Agreement shall be void and all insurance under this
Agreement shall be forfeited.
D. SUBROGATION
-----------
The Company shall be subrogated to the rights of the insured to
recover from any third party including any Excess Deductible
Amounts paid on behalf of the Insured to such third party liable
for such Excess Deductible Amounts. The Insured hereby assigns
its rights to participate in any recoveries by an Insurer. The
Insured shall cooperate fully with the Company to recover such
Excess Deductible Amounts.
E. OTHER INSURANCE
---------------
Except with respect to Covered Policy, the insurance under this
Agreement shall be excess insurance over and above any other
applicable insurance available to the Insured, whether such other
insurance is stated to be primary, contributing, excess,
contingent or otherwise and whether such other insurance is valid
and collectible.
F. BANKRUPTCY OR INSOLVENCY OF INSURED
-----------------------------------
Bankruptcy or insolvency of the Insured shall not relieve the
Company of any of its obligations hereunder.
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G. ACTION AGAINST THE COMPANY
--------------------------
No action shall lie against the Company unless, as a condition
precedent thereto the Insured shall have fully complied with all
the terms and conditions of this Agreement. In addition, no
action shall lie against the Company until the amount of the
Insured's obligation to pay Excess Deductible Amounts under the
Covered Policy listed in Item 5 of the Declarations shall have
been determined finally and payment made by an Insurer under a
Covered Policy.
Nothing contained in this Agreement shall give any person or
entity any right to join the Company as a co-defendant in any
action against the Insured to determine the Insured's liability
to such person or organization.
H. AUDIT
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The Company may examine and audit the Insured's books and records
until all timely and properly reported claims are paid under this
Agreement. The Insured shall cooperate fully with the Company
during any audit, and shall provide the Company with any
information or documents requested by the Company that relates to
the rights and obligations of the insured and the Company under
this Agreement.
I. ASSIGNMENT
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This Agreement shall be void if assigned or transferred without
the prior written consent of the Company.
J. CHANGES
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This Agreement may not be changed, amended or otherwise modified
except through a validly issued written endorsement executed by
the Company. Information provided to an agent of the Company
shall not result in a change, amendment or other modification to
any part of this Agreement or stop the company from asserting any
right under the Agreement or relieve the Insured of any duty
under this Agreement.
K. ARBITRATION
-----------
If any dispute arises between the Insured and the Company either
before or after termination of this Agreement with reference to
the interpretation of this Agreement or the rights of either
party under this Agreement, the dispute shall be referred to
arbitration. The arbitration will involve three arbitrators, one
to be selected by each party and the third by the two parties
selected. If either party refuses or neglects to appoint an
arbitrator within thirty (30) days after the receipt of written
notice from the other party requesting it to do so, the
requesting party may nominate two
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arbitrators who shall select the third arbitrator. In the event
the two arbitrators do not agree on the selection of the third
arbitrator shall be selected pursuant to the commercial
arbitration rules of the American Arbitration Association. The
arbitrators shall be officials or former officials of other
insurance of reinsurance companies. The arbitration shall take
place in the State of New York and the arbitration proceedings
shall be governed by the rules of the American Arbitration
Association and the New York Arbitration Law. The arbitrators
shall consider this Agreement honorable engagement rather than
merely a legal obligation; they are relieved of all judicial
formalities and may abstain from following the strict rules of
the law; provided, however, that the arbitrators may not render
any award of punitive or exemplary damages. The decision of a
majority of the arbitrators shall be final and binding on both
the Insured and the Company and judgment upon the award rendered
by the arbitrators may be entered into any court having
jurisdiction thereof. The expense of the arbitrators and of the
arbitration shall be equally divided between the Insured and the
Company. Arbitration is the sole remedy for disputes arising
under this Agreement. The arbitrators are relieved of any
judicial formalities or rules of law and shall be bound to the
standards and practices of the insurance business and the intent
of this Agreement.
L. COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, and the counterparts
shall constitute but one and same instrument, which shall be
sufficiently evidenced by any one counterpart.
M. INTEGRATION, FINAL AGREEMENT
----------------------------
This Excess Deductible Indemnity Agreement represents the
complete and final agreement of the parties hereto and it
supersedes and replaces any prior oral or written understandings
of the parties including. This Agreement shall not be amended or
modified except by the prior written agreement of the Insurer and
the Insured.
IN WITNESS WHEREOF, the parties have __________ this instrument to be
signed by their authorized representatives as of the 22nd day of January, 1997.
COMPANY:
RELIANCE INSURANCE COMPANY OF
ILLINOIS
[SIGNATURE]
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INSURED:
THE VINCAM GROUP, INC.
/s/ MARTIN PEREZ
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Martin Perez
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