EX-g.2
[GRAPHIC OMITTED] GENERALI USA Life Reassurance Company
REINSURANCE AGREEMENT
between
XXXXXXX NATIONAL LIFE INSURANCE COMPANY Lansing, Michigan
and
GENERALI USA LIFE REASSURANCE COMPANY
Kansas City, Missouri
Treaty Reference No. 200501-030
AUTOMATIC & FACULTATIVE REINSURANCE AGREEMENT
TABLE OF CONTENTS
ARTICLE DESCRIPTION PAGE
I BASIS OF REINSURANCE ........................................................1
II LIABILITY ...................................................................3
III ADMINISTRATIVE REPORTING ....................................................4
IV PLANS OF REINSURANCE ........................................................7
V REINSURANCE PREMIUMS ........................................................7
VI PREMIUM ACCOUNTING ..........................................................8
VII OVERSIGHTS ..................................................................9
VIII REDUCTIONS, TERMINATIONS AND CHANGES .......................................10
IX INCREASE IN RETENTION AND RECAPTURES .......................................11
X REINSTATEMENTS, EXCHANGES, ETC .............................................13
XI EXPENSE OF ORIGINAL POLICY .................................................14
XII CLAIMS .....................................................................14
XIII TAX CREDITS ................................................................16
XIV AC TAX .....................................................................16
XV INSPECTION OF RECORDS ......................................................17
XVI INSOLVENCY .................................................................17
XVII ARBITRATION ................................................................18
XVIII PARTIES TO AGREEMENT .......................................................19
XIX ENTIRE CONTRACT ............................................................19
XX TERMINATION OF AGREEMENT ...................................................20
SCHEDULE DESCRIPTION
A SPECIFICATIONS
B PLANS, BENEFITS, RIDERS AND NAAR CALCULATIONS
C ADDITIONAL INFORMATION
EXHIBIT DESCRIPTION
I RETENTION LIMITS
IA UNDERWRITING GUIDELINES
II REINSURANCE PREMIUMS
IIA POLICY FEES, FLAT EXTRAS, SUBSTANDARD PREMIUMS
IIB PERCENTAGES OF PREMIUM (YRT)
III COMMISSIONS AND ALLOWANCES (COINSURANCE)
REINSURANCE AGREEMENT
THIS AUTOMATIC & FACULATATIVE REINSURANCE AGREEMENT ("THE AGREEMENT") IS MADE
AND ENTERED INTO BY AND BETWEEN XXXXXXX NATIONAL LIFE INSURANCE COMPANY ("THE
CEDING COMPANY") AND GENERALI USA LIFE REASSURANCE COMPANY ("GENERALI"),
TOGETHER REFERRED TO AS THE "PARTIES." THE AGREEMENT SHALL BECOME EFFECTIVE ON
THE DATE THE LAST REQUIRED SIGNATURE IS AFFIXED ("HEREINAFTER CALLED THE
"EFFECTIVE DATE"). COVERAGE FOR THE PLANS LISTED IN THE ATTACHED SCHEDULES AND
EXHIBITS SHALL BEGIN JANUARY 10, 2005, (COVERAGE PERIOD) AND AFTER. INCLUDED IN
THIS AGREEMENT ARE REINSURED POLICES, WHOSE EFFECTIVE DATES HAVE BEEN "BACK
DATED" UP TO A MAXIMUM OF SIX MONTHS, UNLESS A LESSER TIME PERIOD IS DICTATED,
IN ACCORDANCE WITH THE APPLICABLE REGULATORY PROVISIONS TO "SAVE AGE", HOWEVER
CLAIM LIABILITY BEGINS UPON COMMENCEMENT OF THE COVERAGE PERIOD.
ARTICLE I
BASIS OF REINSURANCE
1. REQUIREMENTS FOR AUTOMATIC REINSURANCE
A. The individual risk must be a permanent residents of the United
States, US Territories, and Mexico.
B. The individual risk must be underwritten by the CEDING COMPANY
according to the Company's standard underwriting practices and
guidelines as they exist as of the date of that coverage begins under
the terns of this Agreement (the "Underwriting Guidelines") and the
excerpts of the Underwriting Guidelines shown in Exhibit U. The CEDING
COMPANY shall immediately notify GENERALI and obtain its approval,
which shall not be unreasonably withheld, of any material changes in
underwriting practices or guidelines. Any risk falling into a category
of special underwriting programs (e.g. guaranteed issue, simplified
underwriting, internal or external exchanges) shall be excluded from
this Agreement unless specifically included in Schedule A.
C. Any facultative application for reinsurance of current or prior
applications on the same life risk offered to GENERALI or any other
reinsurer shall not qualify for automatic reinsurance.
D. The maximum issue age on any risk shall be as stated in Schedule A.
Applications with issue ages over the limit stated in Schedule A must
be submitted facultatively.
E. The mortality rating on any one risk shall not exceed the Table Rating
stated in Schedule A, or its equivalent on a flat extra premium basis.
Cases exceeding the Table Rating stated in Schedule A, or its
equivalent, must be submitted facultatively.
F. The amount of life insurance inforce among all companies including any
coverage to be replaced plus the amounts currently applied for on an
applicant's life to include any ultimate amount in the event of an
increasing death benefit, does not exceed the JUMBO limit specified in
Schedule A.
G. On any risk, the CEDING COMPANY must retain the amounts of insurance
as stated in Exhibit I. A zero risk retention does not qualify for
automatic reinsurance.
H. The maximum amounts of insurance to be reinsured on any one life shall
not exceed the automatic binding limits as stated in Schedule A.
The minimum amount of insurance to be ceded shall be as stated in
Schedule A. When reinsurance is ceded on a pool basis, the minimum
amount is the amount applicable to the total pool, not each pool
participant.
2. REQUIREMENTS FOR FACULTATIVE REINSURANCE
A. Plan of Insurance Listed in Schedule A:
1) If the Requirements for Automatic Reinsurance are met but the
CEDING COMPANY prefers to apply for facultative reinsurance, or
2) If Requirements for Automatic Reinsurance are not met, then the
CEDING COMPANY must submit to GENERALI all the underwriting
documentation relating to the insurability of the individual risk
for facultative reinsurance.
B. Plan of Insurance Not Listed in Schedule A:
On a Yearly Renewable Teem treaty the CEDING COMPANY may submit
an application for facultative reinsurance on the plan(s)
specified in Schedule A.
On a Coinsurance treaty the CEDING COMPANY may submit an
application for facultative reinsurance on plan(s) listed in
Schedule A.
C. An application for facultative reinsurance may include life insurance
with or without either disability waiver of premium or accidental
death or both. Supplemental benefits without life are excluded from
this agreement.
D. Copies of all underwriting papers relating to the insurability of the
individual risk must be sent to GENERALI for facultative reinsurance.
After GENERALI has examined the underwriting papers, GENERALI will
promptly notify the CEDING COMPANY of the underwriting offer subject
to additional requirements, the final underwriting offer or
declination. Any final underwriting offer on the individual risk will
automatically terminate upon the earliest of:
1) The date GENERALI receives notice of a withdrawal/cancellation by
the CEDING COMPANY,
2) 120 days after the date on which the offer was made, or
3) The date specified in GENERALI's approval to extend the offer.
E. The minimum amount of insurance to be ceded shall be as stated in
Schedule A.
ARTICLE II
LIABILITY
1. GENERALI's liability for automatic reinsurance shall begin simultaneously
with the CEDING COMPANY's liability, or the beginning coverage period,
whichever occurs first.
2. Except for additional coverage pertaining to conditional receipt as
described in Schedule C, GENERALI's liability for facultative reinsurance
on individual risks shall not begin unless and until the CEDING COMPANY has
accepted GENERALI's final and unconditional written offer on the
application for facultative reinsurance.
3. GENERALI's liability for reinsurance on individual risks shall terminate
when the CEDING COMPANY's liability terminates.
4. As long as the original policy remains in full force, all paid-up
additions, COLA's, GIR's, and accumulated dividends shall be the liability
of the CEDING COMPANY unless specifically included in Schedule B of this
agreement.
5. In no event shall reinsurance under this Agreement be in force unless the
insurance issued directly by the CEDING COMPANY is in force and is issued
and delivered in a jurisdiction in which the CEDING COMPANY is properly
licensed.
6. The payment of reinsurance premiums in accordance with this Agreement shall
be a condition precedent to the liability of GENERALI under reinsurance
covered by this Agreement. Notwithstanding any provision to the contrary,
if the CEDING COMPANY fails to pay the reinsurance premiums and such
amounts are more than 120 days in arrears, then GENERALI will have the
right to terminate the reinsurance for new business and all policies having
reinsurance in arrears. GENERALI USA shall remain liable for all other
policies for which premiums have been paid and remain in force at
termination.
ARTICLE III
ADMINISTRATIVE REPORTING
1. SELF-ADMINISTERED BUSINESS
Promptly after liability for insurance has begun on an individual risk, the
CEDING COMPANY shall have the responsibility of maintaining adequate
records for the administration of the reinsurance amount and shall furnish
GENERALI with periodic reports, in substantial conformity with the
following:
A. MONTHLY NEW BUSINESS REPORT
For new business, the CEDING COMPANY must identify the reinsurance
agreement and provide information adequate for GENERALI to establish
reserves, check retention limits, and verify premium calculation.
1) policy number
2) full name of insured
3) date of birth
4) sex
5) issue age
6) policy date
7) underwriting classification
8) plan of insurance/code
9) amount issued
10) amount ceded
11) automatic/facultative indicator
12) state of residence
13) table rating
14) flat extra (amount + number of years)
15) death benefit option (UL products)
16) current net amount at risk
17) transaction code
18) riders (if applicable)
B. MONTHLY CONVERSION REPORT
The CEDING COMPANY shall furnish GENERALI with a separate listing of
reinsurance policies that are conversions or replacements from
policies previously reinsured with GENERALI to the plan(s) as stated
in Schedule A. The listing should provide the following information:
1) 1 through 18 in 1.A above
2) original policy date
3) original policy number
4) attained age
5) duration
6) effective date if other than policy date
C. MONTHLY PREMIUM REPORT
At the end of each month the CEDING COMPANY shall send to GENERALI a
listing of all reinsurance policies issued or renewing during the past
month accompanied by the reinsurance premiums for such policies. The
listing should be segregated into first year issues and renewals and
should provide the following information:
1) 1 through 18 in 1.A above
2) On Yearly Renewable Term treaties the net reinsurance premium due
for each reinsured policy with the premium for life and each
supplemental benefit separated.
3) On Coinsurance treaties the gross reinsurance premium,
commissions, net reinsurance premium and other amounts (e.g.
dividends, cash surrender values) with premium separated for life
and each supplemental benefit.
All monthly lists shall be submitted to GENERALI no later than
the 20th day of the following month.
D. MONTHLY CHANGE REPORT
The CEDING COMPANY shall report the details of all policy terminations
and changes on the reinsured policies. In addition to the data
indicated in 1.A above, the report should provide information about
the nature, the effective date, and the financial result of the change
with respect to reinsurance. For changes, the CEDING COMPANY shall
identify the reinsurance agreement and provide information adequate
for GENERALI to establish reserves, check retention limits, and verify
premium calculation.
E. MONTHLY POLICY EXHIBIT REPORT
The CEDING COMPANY shall provide a summary of new issues,
terminations, recaptures, changes, death claims and reinstatements
during the month and the inforce reinsurance at the end of the month.
F. QUARTERLY REPORTING
1) Within ten (10) days following the end of the quarter, the CEDING
COMPANY shall provide GENERALI with Premiums Due and Unpaid and
Commissions Due and Unpaid. This report may be in summary form
reporting totals by line of business with separate totals for
first year and renewals.
2) Within ten (10) days following the end of the quarter, the CEDING
COMPANY shall provide GENERALI with totals for the reserve
liability including statutory reserves by valuation basis
segregated by Yearly Renewable Term and Coinsurance.
G. ANNUAL INFORCE LISTING
Within ten (10) days after the close of the year, the CEDING COMPANY
shall furnish GENERALI a listing of reinsurance in force by policy, by
year of issue, segregated by Yearly Renewable Term and Coinsurance and
include statutory reserves for the same.
H. CLAIMS
Claims shall be reported as incurred on an individual basis.
I. CHANGE IN REPORTING FORMATTED]
If the CEDING COMPANY chooses to report its reinsurance transaction
via electronic media, the CEDING COMPANY shall consult with GENERALI
to determine the appropriate reporting format. Once determined, the
CEDING COMPANY shall communicate any change in the data format or code
structure to GENERALI prior to the use of such changes in the reports
to GENERALI.
2. INDIVIDUAL CESSION BUSINESS
Promptly after liability for reinsurance has begun on the
individual risk the CEDING COMPANY shall send GENERALI a
"Reinsurance Application/Cession". Based on the information on
the "Reinsurance Application/Cession", GENERALI will prepare and
send the CEDING COMPANY a "Reinsurance Cession Card". When
reinsurance is amended or changed, the CEDING COMPANY shall send
GENERALI a "Notification of Change in Policy Reinsured".
ARTICLE IV
PLANS OF REINSURANCE
1. Life reinsurance shall be ceded on the basis stated in Schedule A.
2. Copies of all life insurance policies, riders, rate manuals, benefit forms,
commuted value tables and cash value tables shall be provided by the CEDING
COMPANY to GENERALI, and GENERALI shall be promptly notified of any changes
therein.
ARTICLE V
REINSURANCE PREMIUMS
1. Life Reinsurance Premiums are payable annually in advance unless specified
differently on Exhibit II, or as directed in Schedule C, Additional
Information.
A. Life Reinsurance Premiums Paid on a Coinsurance Basis (IF APPLICABLE)
The CEDING COMPANY shall pay the current annual premiums as shown in
Exhibit II based on the amount of life insurance reinsured, less the
applicable allowances stated in Exhibit M. In addition, the CEDING COMPANY
shall pay any policy fee, substandard table extra, and fiat extra premiums
as outlined in Exhibit IIA. In the event the current premium is changed,
GENERALI shall be notified by the CEDING COMPANY immediately.
B. Life Reinsurance Premiums on a Yearly Renewable Term Basis (IF
APPLICABLE)
The life reinsurance premium on the net amount at risk shall be based on
rates shown in Exhibit H.
The reinsurance premiums are guaranteed for one year only. Thereafter,
reinsurance premiums may be changed, upon ninety (90) days written notice
after the expiration of the guarantee period. For those premiums less than
the current minimum valuation net premium, only the latter premiums shall
be guaranteed. Should GENERALI increase the reinsurance premiums to the
current minimum valuation net premium, then the CEDING COMPANY shall have
the right to immediately recapture any business affected by that change.
ARTICLE VI
PREMIUM ACCOUNTING
1. PAYMENT OF REINSURANCE PREMIUM
A. The reinsurance premiums shall be paid to GENERALI using the rates
shown in Exhibits II and IIA, and applying the allowances (Exhibit
III) or, percentages of premium (Exhibit IIB), when applicable.
B. On self-administered business the CEDING COMPANY shall provide the
statement to GENERALI using the format described in Article III,
Self-Administered Business.
D. If a net reinsurance premium balance is payable to GENERALI the CEDING
COMPANY shall pay this balance within forty-five (45) days after the
close of that month. If the full balance is not received within the
forty-five (45) day period, the reinsurance premiums for reinsurance
risks listed on the statement, for which payment was not received,
shall be delinquent and the liability of GENERALI shall cease as of
the date reinsurance premiums were due.
E. If a net reinsurance premium balance is payable to the CEDING COMPANY,
GENERALI shall pay this net balance within forty-five (45) days after
the monthly statement was sent to the CEDING COMPANY. If the monthly
statement has not been returned within forty-five (45) days, GENERALI
shall assume the CEDING COMPANY has verified and is in agreement with
the net balance and shall make payment to the CEDING COMPANY.
2. INTEREST ON DELINQUENT PAYMENTS
If the CEDING COMPANY is more than 90 days in arrears in remitting premiums
to GENERALI, such premiums will be considered delinquent and interest will
be added to the amount to be remitted. Interest will be calculated from (i)
the time the premiums are due GENERALI to (ii) the date the CEDING COMPANY
pays the premium to GENERALI. The rate of interest charged will be equal to
the rate listed in the Federal Reserve Statistical Release, as promulgated
by the Board of Governors of the Federal Reserve System, for the monthly
average of Corporate bonds, Xxxxx'x seasoned Aaa (the "Interest Rate").
3. CURRENCY
The reinsurance premiums and benefits payable under this Agreement shall be
payable in the lawful money of the United States.
ARTICLE VII
OVERSIGHTS
If there is an unintentional oversight or clerical error in the administration
of this Agreement by either the CEDING COMPANY or GENERALI, it can be corrected
provided the correction takes place promptly after the time the oversight or
clerical error is first discovered. In that event, the CEDING COMPANY and
GENERALI will be restored to the position they would have occupied had such
oversight or clerical error not occurred.
ARTICLE VIII
REDUCTIONS, TERMINATIONS AND CHANGES
1. A. If in accordance with policy provisions the original policy is
converted to permanent life insurance, the life risk under the
converted policy which exceeds the amount of risk originally retained
by the CEDING COMPANY shall continue to be reinsured with GENERALI.
B. If there is a replacement where full underwriting evidence is not
required according to the CEDING COMPANY regular underwriting rules,
the life risk which exceeds the amount of risk originally retained by
the CEDING COMPANY shall continue to be reinsured with GENERALI.
C. If there is a replacement where full underwriting evidence is required
by the CEDING COMPANY, reinsurance may be ceded to GENERALI subject to
a written agreement between GENERALI and the CEDING COMPANY.
2. If the amount of insurance under a policy or rider reinsured under this
Agreement increases and
A. The increase is subject to new underwriting evidence, the provisions
of Article I shall apply to the increase in reinsurance.
B. The increase is not subject to new underwriting evidence, GENERALI
shall accept automatically the increase in reinsurance but not to
exceed the automatic binding limit as stated in Schedule A.
3. If the amount of insurance under a policy or rider reinsured under this
Agreement is increased or reduced, any increase or reduction in reinsurance
for the risk involved shall be effective on the effective date of the
increase or reduction in the amount of insurance.
4. If any portion of the prior insurance retained by the CEDING COMPANY on an
individual life reduces or terminates, any reinsurance under this Agreement
based on the same life shall also be reduced or terminated. The CEDING
COMPANY shall reduce its reinsurance by applying the retention limits which
were in effect at the time the policy was issued. The "reinsurance
adjustment due to lapse or reduction of previous insurance" shall be
effective on the same date as the lapse or reduction of prior insurance.
The reinsurance to be terminated or reduced shall be determined in
chronological order by the date the risk was first reinsured. Two or more
policies issued the same date shall be considered one policy.
5. If the insurance for a risk is shared by more than one reinsurer,
GENERALI's percentage of the increased or reduced reinsurance shall be the
same as GENERALI's percentage of initial reinsurance of the individual
risk.
6. If a risk reinsured under this Agreement is terminated, the reinsurance for
that risk shall be terminated as of the effective date of the termination.
7. For facultative reinsurance, if the CEDING COMPANY reduces the mortality
rating, the reduction shall be subject to the facultative provisions of
this Agreement as stated in Article I, Section 2.
8. GENERALI shall refund all unearned reinsurance premiums not including
policy fees, less applicable allowances, arising from reductions,
terminations and changes as described in this Article.
ARTICLE IX
INCREASE IN RETENTION AND RECAPTURES
1. If the CEDING COMPANY changes its retention limits, as listed in Exhibit I,
prompt written notice of the change shall be provided to GENERALI.
2. The CEDING COMPANY shall have the option of recapturing the reinsurance
under this Agreement in the event the CEDING COMPANY increases its
retention limit and the policies have been in force the required length of
time as stated in Schedule A. The CEDING COMPANY may exercise its option to
recapture by giving written notice to GENERALI within ninety (90) days
after the effective date of the increase in retention. If the recapture
option is not exercised within ninety (90) days, the CEDING COMPANY and
GENERALI shall agree to the terms of the recapture, in writing, prior to
the implementation of the recapture program.
3. If the CEDING COMPANY exercises its option to recapture, then:
A. The CEDING COMPANY shall reduce the reinsurance on all individual
risks on which it retained its maximum retention for the age and
mortality rating that was in effect at the time the reinsurance was
ceded. GENERALI shall refund unearned premiums, net of allowances.
B. The CEDING COMPANY shall increase its total amount of retained
insurance on the individual risk up to its new retention limit by
reducing the amount of reinsurance. If an individual risk is shared by
more than one reinsurer, GENERALI's percentage of the reduced
reinsurance shall be the same as GENERALI's initial percentage of
reinsurance on the individual risk.
C. The reduction of reinsurance shall become effective on the later of
the following dates:
1) The policy anniversary date immediately following the date the
recapture program is to begin as determined by paragraph 2. of
this Article;
2) The number of years stated in Schedule A starting with the
"policy date."
D. In the event the CEDING COMPANY overlooks any reduction in the amount
of a reinsurance policy because of an increase in the CEDING COMPANY's
retention, the acceptance by GENERALI of reinsurance premiums under
these circumstances shall not constitute a liability on the part of
GENERALI for such reinsurance. GENERALI shall be liable only for a
refund of premiums.
E. Once a recapture is initiated by the CEDING COMPANY, the recapture
will continue year after year until all eligible policies are
recaptured. Should a claim occur before an eligible policy has been
processed, GENERALI shall deduct from the claim payment the amount the
CEDING COMPANY should have recaptured.
4. No recapture shall be permitted for reinsurance on an individual risk if
(a) the CEDING COMPANY retained less than its retention for the age and
mortality rating in effect at the time the reinsurance was ceded to
GENERALI, or if (b) the CEDING COMPANY did not retain any of the individual
risk.
5. In the circumstance where reinsurance is ceded on a quota share basis, the
CEDING COMPANY will carry out the recapture by increasing its quota share
percentage on the business in the same proportion as the increase in its
maximum schedule of retention.
ARTICLE X
REINSTATEMENTS
EXCHANGES
EXTENDED TERM
REDUCED PAID UP
If a policy reinsured under this Agreement lapses for nonpayment of premium or
is continued on the Reduced Paid-up or Extended Term Insurance basis, and is
reinstated in accordance with the terms of the policy and the CEDING COMPANY's
rules, the reinsurance on such policy shall automatically be reinstated by
GENERALI upon notification of such reinstatement. The CEDING COMPANY shall pay
GENERALI all back reinsurance premiums.
Exchanges, term conversions or other changes in the insurance reinsured with
GENERALI, where not fully underwritten as a new issue, will continue to be
reinsured with GENERALI. When these changes are fully underwritten, the policy
will be handled the same as issuance of a new policy.
Exchanges will be reinsured only if the original policy was reinsured with
GENERALI; the amount of reinsurance will not exceed the amount of reinsurance on
the original policy immediately prior to the exchange. If the business is
subsequently exchanged to any plan reinsured by GENERALI, then such business
will be reinsured at the rates shown in the treaty covering the new plan. Rates
and allowances applicable to the new plan will be determined at point-in-scale
based on the original policy that is being exchanged. If the business is
subsequently exchanged to a plan that is not reinsured with GENERALI under a
specific treaty, then such business shall be reinsured at an agreed upon YRT
rate.
Changes as a result of extended term or reduced paid-up insurance will be
handled the same as life reductions.
ARTICLE XI
EXPENSE OF ORIGINAL POLICY
The CEDING COMPANY shall bear the expense of all medical examinations,
inspection fees, and other charges in connection with the issuance of the
insurance.
ARTICLE XII
CLAIMS
1. The CEDING COMPANY shall give GENERALI written notice within twenty (20)
days of submission to the CEDING COMPANY of any claim on a policy reinsured
under this Agreement, and written notice within ten (10) days of the
service of process upon the CEDING COMPANY in connection with any
litigation involving such claim. Copies of the proofs obtained by the
CEDING COMPANY together with a statement showing the amount due or paid on
such claim by the CEDING COMPANY shall be furnished to GENERALI at the time
payment is requested.
2. GENERALI shall accept the decision of the CEDING COMPANY in payment of the
CEDING COMPANY's contractual liability for the claim and shall pay promptly
its portion to the CEDING COMPANY upon receipt of proof that the CEDING
COMPANY has paid the claimant. It is agreed that if a lesser amount at risk
is retained by the CEDING COMPANY than the amount ceded to GENERALI, the
CEDING COMPANY shall consult with GENERALI concerning its investigation
and/or payment of the claim. However, such consultation shall not impair
the CEDING COMPANY's freedom to determine its course of action on the
claim, and the final decision shall be that of the CEDING COMPANY. In
reaching its decision, the CEDING COMPANY shall act with good faith and in
accord with its standard practices applicable to all claims, whether
reinsured or not.
3. The CEDING COMPANY shall notify GENERALI within ten (10) days from the date
of the CEDING COMPANY's decision to contest, compromise, or litigate a
claim involving reinsurance. Unless GENERALI declines to be a party to such
action, GENERALI shall pay its share of the settlement payment, up to the
maximum reinsurance that would have been payable by GENERALI under the
specific policy had there been no controversy, plus its share of specific
"Claim Expenses" therein involved, except as specified below. If GENERALI
declines to be a parry to the contest, compromise, or litigation GENERALI
shall discharge all of its liability to the CEDING COMPANY by paying the
full amount reinsured under this Agreement to the CEDING COMPANY. "Claim
expenses" shall be deemed to mean only the reasonable legal and
investigative expenses connected with the litigation or settlement of
contractual liability claims. "Claim expenses" shall not include expenses
incurred in connection with a dispute or contest arising out of conflicting
claims of entitlement to policy proceeds which the CEDING COMPANY admits
are payable or any routine claim administrative expenses, including, but
not limited to, compensation of officers and employees of the CEDING
COMPANY.
4. In the event the amount of insurance provided by a policy or policies
reinsured hereunder is increased or reduced because of a misstatement of
age or sex established after the death of the insured, GENERALI shall share
in the increase or reduction in the proportion that the net liability of
GENERALI bore to the sum of the retained net liability of the CEDING
COMPANY and the net liability of other reinsurers immediately prior to such
increase or reduction. The reinsurance with GENERALI shall be written from
commencement on the basis of the adjusted amounts using premiums and
reserves at the correct ages and sex. The adjustment for the difference in
premiums shall be made without interest.
5. It is understood and agreed that the payment of a death claim by GENERALI
shall be made in one sum regardless of the mode of settlement under the
policy of the CEDING COMPANY.
6. In no event shall GENERALI have any liability for any, punitive, exemplary,
extra-contractual or similar damages, fines or penalties which are assessed
against the CEDING COMPANY as a result of acts, omissions or course of
conduct committed by the CEDING COMPANY.
7. If a claim is approved for disability waiver of premium insurance reinsured
under this Agreement, the CEDING COMPANY shall continue to pay reinsurance
premiums to GENERALI. GENERALI shall reimburse the CEDING COMPANY
GENERALI's share of the annual liability.
ARTICLE XIII
TAX CREDITS
In jurisdictions which impose premium taxes on the CEDING COMPANY without
deduction for reinsurance, GENERALI shall reimburse the CEDING COMPANY for taxes
paid on the amount of the reinsurance premiums on the basis shown in Schedule A,
unless GENERALI itself is required to pay a direct tax on such reinsurance
premiums.
ARTICLE XIV
DEFERRED
ACQUISITION COSTS
TAX
The CEDING COMPANY and GENERALI elect under Regulation 1.848-2(g) (8) to compute
"specified policy acquisition expense", as defined in section 848(c) of the
Internal Revenue Code, in the following manner:
The party with net positive consideration as determined under Reg. 1.848-2(f)
and Reg. 1.848-3 shall compute specified policy acquisition expenses without
regard to the general deductions limitation of section 848(c)(1) for each
taxable year.
The parties will exchange information pertaining to the aggregate amount of net
consideration as determined under Regs. 1.848-2(f) and 1.848-3, for all
reinsurance agreements in force between them, to insure consistency for the
purposes of computing specified policy acquisition expenses. GENERALI shall
provide the CEDING COMPANY with the amount of such net consideration for each
taxable year no later than May 1 following the end of such year. The CEDING
COMPANY shall advise GENERALI if it disagrees with the amounts provided, and the
parties agree to amicably resolve any difference. The amounts provided by
GENERALI shall be presumed correct if it does not receive a response from the
CEDING COMPANY by May 31.
GENERALI represents and warrants that it is subject to U.S. taxation under
Subchapter L of the Internal Revenue Code.
ARTICLE XV
INSPECTION OF RECORDS
GENERALI shall have the right, upon reasonable prior notice, during normal
business hours, to inspect at the office of the CEDING COMPANY, all books and
documents which relate to reinsurance under this Agreement.
ARTICLE XVI
INSOLVENCY
1. In the event of insolvency of the CEDING COMPANY, all reinsurance shall be
payable by GENERALI directly to the CEDING COMPANY or its liquidator,
receiver, or statutory successor, on the basis of the liability of the
CEDING COMPANY under the policy or policies reinsured, without diminution
because of the insolvency of the CEDING COMPANY.
2. It is agreed that the liquidator, receiver, or statutory successor of the
insolvent CEDING COMPANY shall give written notice to GENERALI of the
pending of a claim against the insolvent CEDING COMPANY on any policy
reinsured within a reasonable time after such claim is filed in the
insolvency proceedings. During the pendency of any such claim GENERALI may
investigate such claim and interpose, in the proceeding where such claim is
to be adjudicated, any defense or defenses which GENERALI may deem
available to the CEDING COMPANY or its liquidator, receiver, or statutory
successor.
The expense thus incurred by GENERALI shall be chargeable, subject to court
approval, against the insolvent CEDING COMPANY as part of the expense of
liquidation to the extent of a proportionate share of the benefit which may
accrue to the CEDING COMPANY solely as a result of the defense undertaken
by GENERALI.
3. Where two or more reinsurers are participating in the same claim and a
majority in interest elect to interpose a defense to such claim, the
expense shall be apportioned in accordance with the terms of the Agreement
as though such expenses had been incurred by the CEDING COMPANY.
4. To the extent permitted by applicable law, any debts or credits, matured or
unmatured, liquidated or =liquidated, in favor of or against either the
CEDING COMPANY or GENERALI with respect to this agreement or with respect
to any other claim of one party against the other are deemed mutual debts
or credits, as the case may be, and shall be set off, and only the balance
shall be allowed or paid.
ARTICLE XVII
ARBITRATION
1. It is the intention of the CEDING COMPANY and GENERALI that the customs and
practices of the life insurance and reinsurance industry shall be given
full effect in the operation and interpretation of this Agreement. The
parties agree to act in all things with the highest good faith. However, if
GENERALI and the CEDING COMPANY cannot mutually resolve a dispute or claim
which arises out of or relates to this agreement, the dispute or claim
shall be settled through arbitration.
2. The arbitrators shall be impartial regarding the dispute, and shall base
their decision on the terms and conditions of this agreement plus, as
necessary, on the customs and practices of the life insurance and
reinsurance industry.
3. There shall be three arbitrators who must be officers of life insurance
companies other than the parties to this agreement or their subsidiaries.
Each of the parties to this agreement shall appoint one of the arbitrators
and these two arbitrators shall select the third. If a party to this
agreement fails to appoint an arbitrator within thirty (30) days after the
other party to this agreement has given notice of the arbitrator
appointment, the American Arbitration Association shall appoint an
arbitrator for the party to this Agreement that has failed to do so. Should
the two arbitrators be unable to agree on the choice of the third, then the
appointment of this arbitrator is left to the American Arbitration
Association.
4. Except for the appointment .of arbitrators in accordance with the
provisions of Section 3 of this Article, arbitration shall be conducted in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association which are in effect on the date of delivery of
demand for arbitration. Arbitration shall be conducted in Lansing,
Michigan.
5. Each party to this agreement shall pay part of the arbitration expenses
which are apportioned to it by the arbitrators.
6. The award agreed by the arbitrators shall be final, and judgment may be
entered upon it in any court having jurisdiction.
ARTICLE XVIII
PARTIES TO AGREEMENT
This is an Agreement for indemnity reinsurance solely between the CEDING COMPANY
and GENERALI. The acceptance of reinsurance under this Agreement shall not
create any right or legal relation whatever between GENERALI and the insured,
owner, or any other party to or under any policy reinsured under this Agreement.
ARTICLE XIX
ENTIRE CONTRACT
1. This agreement shall constitute the entire agreement between the parties
with respect to business being reinsured hereunder and that there are no
understandings between the parties with respect to business being reinsured
hereunder other than those expressed in this agreement.
2. Any change or modification to this agreement shall be null and void unless
made by written amendment to this agreement signed by both parties.
ARTICLE XX
RESERVES FOR REINSURANCE
Company shall at all times be entitled to receive full credit for reserves held
by Reinsurer according to the laws and regulatory agencies of the states in
which Company is licensed. Reinsurer and Company agree to use commercially
reasonable efforts to assure that this is accomplished
ARTICLE XXI
TERMINATION OF AGREEMENT
1. Subject to the provisions of Article II, 6., this Agreement may be
terminated at any time with respect to new business only by either party
giving at least ninety (90) days written notice of termination. The day the
notice is deposited in the mail addressed to the Home Office, or to an
Officer of either company, shall be the first day of the ninety-day (90)
period.
2. The CEDING COMPANY shall continue to cede reinsurance and GENERALI shall
continue to accept reinsurance, as provided for by the terms of this
Agreement, until the date of termination.
3. Subject to the provisions of Article II, 6., all automatic reinsurance
which became effective prior to the termination of this Agreement and all
facultative reinsurance approved by GENERALI based upon applications
received prior to termination of this Agreement shall remain in effect
until its termination or expiration, unless the CEDING COMPANY and GENERALI
mutually decide otherwise.
THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY
THE PARTIES.
IN WITNESS WHEREOF, that certain Automatic Reinsurance Agreement commencing
January 10, 2005 (The Agreement) is hereby covering policies described in the
attached Schedules and Exhibits therein issued on or after January 10, 2005.
This Agreement is hereby executed in counterpart between the parties and duly
signed by both parties' respective officers as follows:
GENERALI USA LIFE REASSURANCE XXXXXXX NATIONAL LIFE INSURANCE
COMPANY COMPANY OF NEW YORK
By: XXXX XXXXXX By: XXXX X. XXXXX
-------------------------- ----------------------------
Title: SVP Title: SVP & Chief Actuary
----------------------- -------------------------
Date: 6/21/2005 Date: 06/16/05
------------------------ --------------------------
By: XXXXX X. XXXXX By: XXXXXXX X. XXXXX
-------------------------- ----------------------------
Title: SVP Title: AVP
----------------------- -------------------------
Date: 6/21/2005 Date: 6/16/05
------------------------ --------------------------
SCHEDULE A
TREATY SPECIFICATIONS
XXXXXXX NATIONAL LIFE Treaty #: 200501-030
--------------------------------------------------------------------------------
TYPE OF BUSINESS:
Life insurance issued by the CEDING COMPANY
TYPE OF REPORTING:
Tape
BASIS OF REINSURANCE:
Automatic / Yearly Renewable Term
PLAN NAMES:
Ultimate Investor VUL
Advisor VUL
Terminal Illness Rider
Other Insured Term Insurance Rider
ALPHA SPLIT:
Surnames beginning with letter A through Z
AGE BASIS:
Age nearest birthday.
QUOTA SHARE IN EXCESS OF RETENTION:
25% of each case on amounts exceeding the Ceding Company's retention.
MAXIMUM AUTOMATIC MORTALITY:
Generali will accept all mortality ratings automatically
MAXIMUM AUTOMATIC ISSUE AGE:
Generali will accept automatically ages through 85
Ages 86-90 must be submitted facultatively
AUTOMATIC BINDING LIMIT:
LIFE: Ten (10 ) times the retention of the CEDING COMPANY to the pool.
JUMBO LIMITS:
Life: [REDACTED]
MINIMUM CESSION AMOUNT:
$[REDACTED]
RATE CAPACITY:
$[REDACTED]
RATES APPLICABLE TO AMOUNTS OVER CAPACITY:
YRT rates shown in Exhibit II.l applying percentages from Exhibit 11B
SCHEDULE A
TREATY SPECIFICATIONS
XXXXXXX NATIONAL LIFE Treaty #: 200501.030
--------------------------------------------------------------------------------
RECAPTURE YEARS:
20 years
PREMIUM TAX REIMBURSEMENT:
Premium taxes are not reimbursed.
SCHEDULE B
PLAN, BENEFITS, & RIDER INFORMATION
XXXXXXX NATIONAL LIFE Treaty #: 200501.030
--------------------------------------------------------------------------------
SELF - ADMINISTERED BUSINESS:
The net amount at risk shall be provided by the CEDING COMPANY in the
self-administered foil 'at described in Article M.
OTHER INSURED TERM RIDERS:
Other Insured Term Rider will be reinsured with Generali USA on Other Insured
Term Rider COI's applying the same percentages of premium as the base plan.
TERMINAL ILLNESS RIDER:
Generali USA will share proportionately in the Terminal Illness Rider.
SCHEDULE C
ADDITIONAL DETAILED INFORMATION
XXXXXXX NATIONAL LIFE Treaty #: 200501.030
--------------------------------------------------------------------------------
CONDITIONAL RECEIPT OR TEMPORARY COVERAGE:
A. EXCLUSIONS. Regardless of any provision to the contrary, the provisions of
Article I Automatic Reinsurance and Article II Facultative Reinsurance do
not apply to, and no reinsurance is available under, those provisions in a
situation where the Ceding Company provides insurance coverage for an
applicant prior to the issuance and proper delivery of a Reinsured Policy
to the applicant during his or her lifetime.
B. CONDITIONAL COVERAGE. Generali USA will provide the following limited
indemnity reinsurance coverage in an instance where "conditional receipt"
coverage, temporary insurance coverage or other similar coverage is made
available to the Ceding Company's applicant (the "Applicant") prior to the
issuance of a Reinsured Policy during the lifetime of the applicant,
subject to the following conditions.
1. The Ceding Company must (x) provide Generali USA with all relevant
foams, rules, requirements and practices applicable to such coverage
(the "Conditional Rules"), (y) the Conditional Rules are acceptable to
Generali USA, with such approval not being unreasonably withheld and
(z) the Applicant's coverage was provided in accordance with the
Conditional Rules in all material respects.
a. If there are material changes in these items, no coverage is
available under this Article during the period from the date of
such change until the date the Ceding Company has provided
Generali USA with updated copies and Generali USA has agreed that
they are acceptable, with such agreement not being unreasonably
withheld.
C. COVERAGE LIMITS. Notwithstanding any provision to the contrary, the
reinsurance coverage provided under this Article is strictly limited to
Generali USA's 25 percent share of $[REDACTED] once the CEDING COMPANY has
filled their retention, for any single life regardless of the number and
terns of any conditional receipts, temporary coverage terms, policy
provisions, settlement terns or other similar provisions. Temporary
Insurance Agreement form X3002A 03/03 is used.
PREMIUMS BASED ON:
The reinsurance premiums are based on percentages of the VUL1803 Reinsurance
rates.xls
EXHIBIT I
RETENTION SCHEDULE
XXXXXXX NATIONAL LIFE Treaty #: 200501.030
--------------------------------------------------------------------------------
EFFECTIVE WITH POLICIES DATED: JANUARY 10, 2005
Standard - TBL 2 Substandard Substandard
Issue Table Flat Extra Table Flat Extra
Ages Table 3 - Table 8 Table 9 +
---------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------
0-65 $[REDACTED] $[REDACTED] $[REDACTED]
66 - 75 $[REDACTED] $[REDACTED] $[REDACTED]
76 - 85 $[REDACTED] $[REDACTED] $[REDACTED]
EXHIBIT IA UNDERWRITING GUIDELINES AND THE LINCOLN/SWISS
RE UNDERWRITING MANUAL
BUSINESS CONSIDERATIONS BASED ON TOTAL CASE UNDERWRITING
2004 PROTECTOR/GENERATIONS UNDERWRITING
MAY 13, 2004
Deviations from guidelines are considered in view of specific issues associated
with the primary condition that help offset the negative impact of the condition
in company with at least slightly better results than the rating class being
considered in related or key areas. A proposed insured should generally not have
considerations made in more than one category. Underwriting judgment prevails.
CATEGORIES WITH NO CONSIDERATION GUIDELINES
The following categories have no pre-defined guideline considerations.
Generally, these issues would not have specific consideration in other
categories. Tobacco use can be a consideration with certain cases.
--------------------------------------------------------------------------------
CATEGORY COMMENTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
AVOCATIONS PREFERRED PLUS: We are only concerned if the activity is
rated or a combination of activities presents a risk, though
not rated, that would be significant.
--------------------------------------------------------------------------------
OCCUPATIONS PREFERRED PLUS: In view of the rarity of having an
occupation rated, these should be referred, if found to be
issues.
--------------------------------------------------------------------------------
CATEGORIES WITH GENERAL CONSIDERATION GUIDELINES
These categories may provide more significant consideration. They may aid in the
analysis of medical or non-medical considerations in a case. Specific results
can be interpreted broadly, providing individual assessment in determining the
usefulness in assessing the overall preferred risk.
--------------------------------------------------------------------------------
CATEGORY COMMENTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
ALCOHOL PREFERRED PLUS: In trying to establish a case as otherwise
TREATMENT OR Preferred Plus, the absence of any alcohol criticism or
ABUSE treatment is preferred. While the guidelines permit old
history, any admitted history would not be a good factor in
attempting to qualify a case. As for accepting more
significant history in this category for Preferred Plus, one
should expect no significant driving history for seven years
(Plus or better, perhaps, with no major accidents and
nothing more significant than speeding) or drug abuse and/or
treatment ever. Tying treatment to a driving situation over
seven years ago may be acceptable with a careful review of
current use, occupation, finances and other risk factors.
Other treatment may never be acceptable.
PREFERRED: In trying to establish a case as otherwise
Preferred, the absence of any alcohol criticism or treatment
is preferred. While the guidelines permit old history, any
admitted history would not be a good factor in attempting to
qualify a case. As for accepting more significant history in
this category for Preferred, one should expect no driving
history for seven years (Plus or better, perhaps, with no
major accidents and nothing more significant than speeding)
or drug abuse and/or treatment ever. Tying treatment to a
driving situation over five years ago may be acceptable with
a careful review of current use, occupation, finances and
other risk factors. Other old treatment or abuse has to be
carefully reviewed if there is history between five and
seven years ago.
GENERALLY: Specific in-patient care for alcohol abuse is
easy to assess. General criticism is harder. Try to acquire
details to habits and circumstances where recommendations or
criticisms are made, but no laboratory or other exam
findings alone make a case for alcoholism.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
CATEGORY COMMENTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
AVIATION PREFERRED PLUS: Private pilots are not allowed in Preferred
Plus except for some commercial pilots with private aviation
as well. Even then, care should be taken regarding their
aviation activities. Other risks scrutinized include
driving, avocations and behaviors characterized as
risk-taking. Any rated aviation activity is excluded even if
a commercial pilot.
PREFERRED: Consideration could be given unilaterally on
hours, depending on other factors qualifying and no other
issues in other categories. There should be no consideration
given on the rating just because the class is preferred.
International travel is not meant to include Canada or
United States territories, protectorates, etc. Other risks
scrutinized include driving, avocations and behaviors
characterized as risk-taking.
--------------------------------------------------------------------------------
DRIVING PREFERRED PLUS: In trying to establish a case as otherwise
Preferred Plus, the absence of any driving history is
preferred and no admitted history of DWI or reckless driving
would make sense for special consideration. As for accepting
more significant history in this category for Preferred
Plus, perhaps three infractions within three years may be
acceptable if of borderline significance with clearly
standard NIVR scoring and there is no history at all of
alcohol or drug criticism or treatment. This should be
offset with clearly qualifying medical considerations as
well as the habits, etc. In some situations, one or two
violations could be a concern. Multiple at-fault accidents,
for example, may not be Preferred Plus, despite being
"within the guidelines" on count.
PREFERRED: In trying to establish a case as otherwise
Preferred, driving history qualifying as Preferred Plus is
preferred and no admitted history of DWI or reckless driving
would likely make sense for special consideration. As for
accepting more significant history in this category for
Preferred, the bare minimum is a standard driving risk with
no more than 4 violations and we would prefer the risk be a
little better than Standard and with no history of alcohol
or drug criticism or abuse. As with Preferred Plus, merely
qualifying on the number of infractions does not mean the
applicant is preferred.
--------------------------------------------------------------------------------
DRUG ABUSE OR PREFERRED PLUS: In making a case for Preferred Plus in an
TREATMENT otherwise exceptional candidate, the minimum requirement is
no drug use or abuse for ten years. Marijuana may be an
exception, but you would not want recent use in most cases
(within seven years - maybe longer). There should never be
alcohol abuse. Driving in these cases is to be Plus or
better.
PREFERRED: The case for Preferred would be similar to
Preferred Plus, except allowing seven years post abuse or
use. Marijuana is illegal (except for prescribed use in some
areas). Use of marijuana within five years likely excludes
the candidate from Preferred. Generally, "occasional"
marijuana may not exclude from Preferred TU consideration.
Isolated use may be disregarded, depending on the details.
The case otherwise attempting to qualify as Preferred should
be absent of any drug abuse or treatment and likely any use
at all, including marijuana. In any case, a combination with
alcohol abuse or driving issues would not lend the case to
special consideration.
--------------------------------------------------------------------------------
TOBACCO USE PREFERRED PLUS: The occasional cigar may be considered. A
question could be raised on inhaling. The frequency should
be less than 4 a year, as a guideline.
PREFERRED: The occasional cigar may be considered. A
question could be raised on inhaling. The frequency should
be less than 12 a year, as a guideline with a preference for
8 or fewer, depending on other factors. Pipe smoking may
qualify on rare occasions; however, there are currently no
known studies to suggest pipe smoking has the same risks as
cigar smoking.
PREFERRED TOBACCO: A negative cotinine value is preferred,
but not required. This can be a factor in assisting in the
categorization of the tobacco user. The user who smokes more
than a pack of cigarettes a day starts to become less
preferred, despite other qualifiers, as the use increases. A
cotinine level of 5.0 or higher should not normally be
considered as Preferred TU without offsets in other
categories.
STANDARD NON-TOBACCO: The occasional cigar may be
considered. A question could be raised on inhaling. The
frequency should be less than 24 a year, as a guideline,
with 12 or fewer preferred, depending on other factors. Pipe
smoking may qualify on rare occasions; however, there are
currently no known studies to suggest pipe smoking has the
same risks as cigar smoking.
CONTINUED ON NEXT PAGE
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
CATEGORY COMMENTS
--------------------------------------------------------------------------------
TOBACCO USE LAST USE Limitations: As a person approaches a new
(CONTINUED) threshold, consideration can be given in rare instances to
moving the user into the next higher category if the other
aspects of the case are clearly qualifiers and better. For
example, a person who last used tobacco 11 months ago might
qualify for Non-Tobacco if all other aspects of the case are
exceptional. Questions should focus on what they used, how
often and for how long.
COTININE RESULTS: We do not allow retesting without approval
of the Chief Underwriter. Our general practice is not to
retest in any case. We may test blood for cotinine in some
cases, but is preferred to be considered where this can
prove use, not raise unanswerable questions. Urine
concentration may be an issue in some cases.
--------------------------------------------------------------------------------
CATEGORIES WITH SPECIFIC CONSIDERATION GUIDELINES
The objective of these guidelines is to allow a proposed insured with one of the
four conditions below not qualifying for either Preferred Plus or Preferred to
qualify on the basis of exceptional qualifications in the other three
categories, given there are no other questionable qualifications. In some cases,
arguments can be made to consider the other factors on earlier pages - which
makes actuarial sense - but are not commonly expected to be used as offsets. The
other three below must qualify to offset the fourth.
"Plus Qualifier" and "Preferred Qualifier" are the revised Plus or Preferred
guidelines, respectively, in order to qualify a proposed insured under the Plus
or Preferred guidelines who does not qualify in ONE category below. These
special qualifying results may be considered in some of the other factors
mentioned above as additional considerations in evaluating the overall risk
present in the case.
"Plus Limit" and "Preferred Lt" are the maximum consideration outside of the
usual Plus or Preferred guidelines, respectively, in order to qualify a proposed
insured under the Plus or Preferred guidelines who does not qualify in that ONE
category below. One would expect a non-qualifying factor to be completely offset
by the other three factors below in order to qualify.
The following are guidelines. Any consideration outside requires more
documentation and explanation of the offsetting credits than those within the
specifications. Refer exceptional situations or business considerations to an
Underwriting Consultant or higher or the Chief Underwriter.
--------------------------------------------------------------------------------------------------------------
CATEGORY PLUS QUALIFIER PLUS LIMIT PREFERRED QUALIFIER PREFERRED LIMIT
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
Blood Ages <55 130/80 Ages <55 140/90 Ages < 55 135/85 Ages < 55 145/90
Pressure Ages 55 + 135/85 Ages 55 + 150/90 Ages 55 + 140/90 Ages 55 + 160/90
No Treatment With NO Treatment
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
Build Maximum Build Maximum Build Maximum Build Maximum Build
4'10"-5'0"93-125 4'10"-5'0"93-155 4'10"-5'0"93-135 4'10"-5'0"93-172
5'1" - 5'3" 100 - 140 5'1" - 5'3" 100 - 170 5'1" - 5'3" 100 - 150 5'1" - 5'3" 100 - 187
5'4" - 5'6" 108 - 150 5'4" - 5'6" 108 - 185 5'4" - 5'6" 108 - 160 5'4" - 5'6" 108 - 200
5'7" - 5'9" '117 - 169 5'7" - 5'9" 117 - 200 5'7" - 5'9" 117 - 180 5'7" - 5'9" 117 - 214
5'10" - 6'0" 125 - 183 5'10" - 6'0" 125 - 218 5'10" - 6'0" 125 - 195 5'10" - 6'0" 125 - 232
6'1" - 6'3" 135 - 198 6'1" - 6'3" 135 - 235 6'1" - 6'3" 135 - 210 6'1" - 6'3" 135 - 248
6'4" - 6'6" 145 - 212 6'4" - 6'6" 145 - 255 6'4" - 6'6" 145 - 225 6'4" - 6'6" 145 - 268
No significant weight No significant weight
loss within the past loss within the past
year. year.
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
Family No death or disease One death or disease No death or disease Two deaths or
History prior to age 70. prior to age 60. Use prior to age 65. Use disease prior to age
internal guidelines internal guidelines 60, one of which
following this following this must be age 55 or
section. section. older. Use internal
guidelines following
this section.
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CONTINUED ON NEXT PAGE
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CATEGORY PLUS QUALIFIER PLUS LIMIT PREFERRED QUALIFIER PREFERRED LIMIT
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
Lipids <198 and ratio < 4.5 <260 and < 6.0 <220 and < 5.0 <260 OR < 6.0, but
OR never higher than 299
<220 and ratio < 4.0 or 7.9.
HDL must be greater
than 44. LDL must
be less than 125
AND Trigs less than
250 (if fasting).
--------------------------------------------------------------------------------------------------------------
SPECIAL NOTE - FAMILY HISTORY UNDERWRITING
There are cases where an argument is made to set aside family history due to
environmental issues. An example would be the proposed insured whose father died
of an MI at age 50 after smoking his entire life, being overweight, never
exercised and generally did not take care of himself These specific cases are to
be reviewed with all other factors. A borderline acceptable risk would not
present as strong of an argument for underwriting consideration, whereas the
perfectly fit and otherwise highly qualified applicant might. Otherwise, see the
Categories With Specific Consideration Guidelines.
Special consideration can be given in general to the following situations
utilizing the Categories With Specific Consideration Guidelines where required:
o Cancer: Consider primarily colon cancer and melanomas plus
gender-linked cancers of the breast, ovaries and prostate. Other
cancers may not pose a threat due to family history.
o Diabetes: Isolated Type 1 or 2 diabetes in first degree relatives
older than 55 at onset may not be considered a threat due to family
history, given indicators on the current proposed insured are well
within normal (no borderline cases).
o Stroke and heart disease: We are looking primarily for
vascular-related conditions that imply the presence of "hardening of
the arteries." Other histories may or may not be exclusionary; please
refer to the Medical Director for consideration.
There may be other cases where a seemingly qualified candidate does not qualify
on the basis of other family history. These may include:
o Multiple deaths or diagnoses (or combination thereof) from one
condition or related conditions otherwise not excluded by the
guidelines above
o Death or diagnosis with a SUGGESTION of the same or related condition
in the proposed insured's personal history or findings
An isolated family history event that may be proven to be of an environmental
nature (such as related to habits or some exposure) may be overlooked. Multiple
family history events related to the same condition would be difficult to
justify being overlooked. Additional question on family history is acceptable,
but we are not attempting to underwrite the family member.
Consideration could be made on the basis of a near-qualifier - such as the
proposed insured with a first degree relative having died at age 64 (versus 65)
or 59 (versus 60). These cases are expected to follow the underwriting
philosophy that the whole picture offers offsets or factors that qualify the
proposed insured.
PERSONAL HISTORY CONSIDERATIONS
The following is a list of conditions or circumstances not LIKELY to qualify as
a preferred risk. Some MAY qualify in otherwise perfectly decent cases on a rare
occasion. Qualifying merely as standard does not, even qualifying by the factors
above, always allow for preferred consideration. Please refer any questions to
the Chief Underwriter as there are other, sometimes rare, conditions than
mentioned below. All are considered to exclude Preferred consideration if having
occurred within 10 years unless otherwise specified and regardless of recovery
in many cases.
Heart impairments (CAD, valvular conditions, structural defects, conduction defects)
Cancer (except non-invasive skin cancer) Stroke
Diabetes Type 1 or 2
COPD
Emphysema
Conditions treated frequently and/or regularly with steroids
Asthma treated with steroids or requiring hospitalization
History of Status Asthmaticus
Felony conviction within seven years
Bankruptcy within seven years
Mental or nervous disorder requiring hospitalization or with significant treatment required to regulate
DWI history combined with alcohol or drug abuse or criticism
Chronic kidney disease or history of renal failure
Liver disease requiring ongoing treatment
Peripheral vascular disease
Hepatitis C
Foreign residence or significant travel planned or frequently in the past (depending on locations)
Foreign national (depending on locations and likelihood of return, visits, etc.)
Limitations of ADL or AADL (generally over age 70)
A FINAL WORD
Any deviation from established guidelines or rules requires sound underwriting
judgment and good documentation if the consideration is to be justified as an
underwriting decision. If a deviation cannot meet those requirements, the issue
would have moved into the category of a "business consideration" and needs
support from management. The Chief Underwriter needs to participate in most all
of these business considerations. Most "business considerations" may require
reinsurance acceptance, although some tolerance is accepted.
------------------------------------------------------------------------------------------------------------------------------------
XXXXXXX NATIONAL LIFE & XXXXXXX NATIONAL LIFE OF NEW YORK UNDERWRITING GUIDELINES - JUNE 2003
------------------------------------------------------------------------------------------------------------------------------------
AGE [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED]
0-15 A A A C F F F F F
16-50 A C C C D G I I I
51-55 A C C C D H I I J
56-60 A C C D D H I I J
61-70 A C D E E H I I J
71 and up B D D E E H I J J
------------------------------------------------------------------------------------------------------------------------------------
A - Application only
------------------------------------------------------------------------------------------------------------------------------------
B - Application and Paramedical Exam
------------------------------------------------------------------------------------------------------------------------------------
C - Application and Blood/Urine plus Physical Measurements (build and blood pressure)
------------------------------------------------------------------------------------------------------------------------------------
D - Application, Paramedical Exam and Blood/Urine
------------------------------------------------------------------------------------------------------------------------------------
E - Application, Paramedical Exam, EKG and Blood/Urine
------------------------------------------------------------------------------------------------------------------------------------
F - Call your Underwriter for requirements
------------------------------------------------------------------------------------------------------------------------------------
G - Application, Paramedical Exam, Blood/Urine, CFS and HO-ordered MVR
------------------------------------------------------------------------------------------------------------------------------------
H - Application, Paramedical Exam, EKG, Blood/Urine, CFS and HO-ordered MVR
------------------------------------------------------------------------------------------------------------------------------------
I - Application, Paramedical Exam, EKG, Blood/Urine, CFS and HO ordered Inspection Report and MVR
------------------------------------------------------------------------------------------------------------------------------------
J - Application, Paramedical Exam, Blood/Urine, CFS, Treadmill EKG (ONLY if none has been performed within 2 years) OR review of
Treadmill EKG done within 2 years AND current resting EKG and HO-ordered Inspection Report and MVR (NOTE: Historical Treadmill EKG
preferred on clients over age 75 - call your underwriter for more information)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
JNL orders MVR's on risks of $[REDACTED] and under that are proven to have increased mortality from accidents, including private
pilots and younger drivers.
------------------------------------------------------------------------------------------------------------------------------------
JNL orders Personal History Interviews on ages 60 and up who are not examined and have no personal physician or admitted medical
history. An exam by a Medical Doctor may also be required.
------------------------------------------------------------------------------------------------------------------------------------
JNL reserves the right to order other requirements, including medical records and other tests, where the proposed risks warrants
additional investigation.
------------------------------------------------------------------------------------------------------------------------------------
JNL recommends a cover letter on any case where an explanation of the financial justification will expedite the underwriting
process. On cases over $[REDACTED], a cover letter can eliminate delays or questions in the underwriting process.
------------------------------------------------------------------------------------------------------------------------------------
JNL will ROUTINELY pursue medical records (APS) on applicants applying for insurance who are age 70 or over OR who are applying for
$[REDACTED] or more in face amount. Except in rare instances, we will NORMALLY order medical records (APS) on cases of [REDACTED]
and over.
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JNL/JNL-NY 2003 Preferred Plus - Protector Preferred - Protector Preferred Tobacco - Protector Standard - All JNL
Guidelines Term Generations UL and VUL Term, Generations UL Term, Generations UL and VUL Products
(including VUL) and VUL
------------------------------------------------------------------------------------------------------------------------------------
Alcohol Treatment No history of alcohol treat- No history of alcohol No history of alcohol treatment No alcohol treatment
or Abuse ment. No alcohol abuse treatment for 10 years for 10 years past treatment for 7 years. No
criticism for past 10 years. past treatment comple- completion. No alcohol abuse alcohol abuse
tion. No alcohol abuse criticism for past 7 years. criticism for 3
criticism for past 7 years.
years.
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Aviation No aviation risks except for No aviation risks except Aviation risks can be rated.
commercial pilots flying for pilots with IFR or Aviation Exclusion rider is
regularly scheduled commercial ATR classification, 500 also available.
jets to any area acceptable hours minimum experience
for travel. Other aviation with no international
risks may be considered only flying (except for
with an Aviation Exclusion commercial pilots) who
Rider. Pilots are scrutinized are otherwise standard
for other risks they may take. for aviation risks. Other
aviation risks may be
considered only with an
Aviation Exclusion Rider.
Pilots will be scrutinized
for either risks they may
take.
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Avocations No rated sports and Sports and avocations Sports and avocations can be Sports and avoca-
avocations. can be rated only as rated only as flat extra tions are eligible
flat extra ratings. ratings. and can be rated.
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Blood Pressure Current readings must be Current readings must be Current readings must be normal Current readings
normal and cannot exceed: be normal and cannot and cannot exceed: must be normal and
135/85 ages 0-54; 140/90 exceed: 140/90 ages 140/90 ages 0-54; 150/90 ages cannot exceed:
ages 55 and up. No treated 0-54; 150/90 ages 55 and 55 and up. 155/95 ages 0-49;
hypertension. up. Treated hypertension allowed 165/95 ages 50 and
Treated hypertension when controlled. up. Treated hyper-
allowed when controlled. tension allowed
when controlled.
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Build Height Weight Height Weight Height Weight Ht Wt Ht Wt
4'10"-5'0" 98-135 lbs. 4'10"-5'0" 98-155 lbs. 4'10"-5'0" 98-155 lbs. 4'10" 187 5'6" 228
5'1"-5'3" 105-150 lbs. 5'1"-5'3" 105-170 lbs. 5'1"-5'3" 105-170 lbs. 4'11" 191 5'7" 234
5'4"-5'6" 113-160 lbs. 5'4"-5'6" 113-185 lbs. 5'4"-5'6" 113-185 lbs. 5'0" 195 5'8" 240
5'7"-5'9" 123-180 lbs. 5'7"-5'9" 123-200 lbs. 5'7"-5'9" 123-200 lbs. 5'1" 201 5'9" 246
5'10"-6'0" 132-195 lbs. 5'10"-6'0" 132-218 lbs. 5'10"-6'0" 132-218 lbs. 5'2" 205 5'10" 252
6'1"-6'3" 143-210 lbs. 6'1"-6'3" 143-235 lbs. 6'1"-6'3" 143-235 lbs. 5'3" 210 5'11" 258
6'4"-6'6" 155-225 lbs. 6'4"-6'6" 155-255 lbs. 6'4"-6'6" 155-255 lbs. 5'4" 216 6'0" 267
5'5" 222 6'1" 274
Ht Wt
6'2" 281
6'3" 288
6'4" 297
6'5" 304
6'6" 311
6'7" 320
These are the maxi-
mum weights per
height indicated.
*Build alone might
be standard in some
cases when all other
factors are standard
or better.
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Driving No history of DWI or reckless No history of DWI or No history of DWI or reckless No history of DWI
driving within 7 years. No reckless driving within driving within 5 years. No more within 3 years,
more than 2 moving violations 5 years. No more than 3 than 3 moving violations within given no other
within the past three years. moving violations within the past three years. driving violations.
the past three years. There may be factors
that would allow
taking the case
standard if a DUI
occurred within 3
years with UW
discretion.
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Drug Abuse or No history of drug abuse or No history of drug abuse No history of drug abuse or No treatment for
Treatment treatment. or treatment for 10 years treatment for 10 years or drug use for 7
or since last use if since last use if deemed not years.
deemed not to require to require treatment.
treatment
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Family History No death or diagnosis of No death or diagnosis of No death or diagnosis of cancer, No more than 3
cancer, heart disease, stroke cancer, heart disease, heart disease, stroke or deaths from or
or diabetes, under age 65. stroke or diabetes, under diabetes, under age 60. JNL diagnosis of cancer,
JNL weighs the material age 60. JNL weighs the weighs the material significance heart disease,
significance of causes of material significance of of causes of death, diagnoses diabetes, hyper-
death, diagnoses and causes of death, and occurrences. tension or any
occurrences. diagnosis and familial disease
occurrences. under age 60.
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Lipids Cholesterol of <220 and Cholesterol of <260 and Cholesterol of <260 and The maximum
Cholesterol/HDL ratio of Cholesterol/HDL ratio of Cholesterol/HDL ratio of <6.0. Cholesterol/HDL
<5.0. Allow treatment with <6.0. Allow treatment Allow treatment with control. ratio is 10.9 so
control. JNL weighs the with control. JNL weighs JNL weighs the significance of long as the total
significance of treatment to the significance of treatment to maintain control. cholesterol does not
maintain control. treatment to maintain exceed 249. The
control. maximum cholesterol/
HDL ratio is 8.9 so
long as the total
cholesterol does not
exceed 349. No
treated hyperlipi-
demia or elevated
cholesterol unless
the cholesterol is
controlled.
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Occupations - No hazardous or rated No hazardous or rated No hazardous or rated occupa- A flat extra rating
Hazards/Rated occupation. occupation unless rated tion unless rated $2.50 or may be added for
$2.50 or less. less. occupation or
hazardous
activities.
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Tobacco Use and/or No use of tobacco is allowed No use of tobacco is Not applicable. No use of tobacco
Positive for 60 months. Urinalysis must allowed for 24 months. is allowed for 12
Cotinine/Nicotine be negative for nicotine Urinalysis must be months. Urinalysis
on Urinalysis byproducts. negative for nicotine must be negative for
byproducts. nicotine byproducts.
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These classes are effective for new products developed in 2003 with five rate
classes (Preferred Plus, Preferred, Standard, Preferred Tobacco and Tabacco).
Please see our website at xxx.xxx.xxx for guidelines on older four- and
three-class products.
EXHIBIT II
REINSURANCE PREMIUMS
XXXXXXX NATIONAL LIFE Treaty #: 200501-030
--------------------------------------------------------------------------------
Percentages of the YRT rates marked Exhibit II apply to the base plan and the
Other Insured Tenn Rider
Percentages of the YRT rates marked Exhibit II.1 apply to amounts over the rates
cap.
[REDACTED]
EXHIBIT IIA
MISCELLANEOUS PREMIUMS
XXXXXXX NATIONAL LIFE Treaty #: 200501-030
--------------------------------------------------------------------------------
POLICY FEES:
There are no policy fees.
FLAT EXTRA PREMIUMS:
Flat extra will be the flat extra premium charged the insured times the per
thousand amount ceded to Generali, less the allowances shown in Exhibit M.
SUBSTANDARD PREMIUMS:
Substandard premiums are standard premiums increased 25% per Table.
EXHIBIT IIB
PERCENTAGES OF PREMIUM
XXXXXXX NATIONAL LIFE Treaty #: 200501-030
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
VUL - MALE
Policy Preferred Preferred Standard
Years Plus NT Preferred NT Standard NT Tobacco Tobacco
---------------------------------------------------------------------------------------------------------------
1 0% 0% 0% 0% 0%
2+ 82% 93% 85% 96% 115%
VUL - FEMALE
Policy Preferred Preferred Standard
Years Plus NT Preferred NT Standard NT Tobacco Tobacco
---------------------------------------------------------------------------------------------------------------
1% 0% 0% 0% 0% 0%
2+ 74% 97% 86% 94% 113%
VUL - MALE (FEE ONLY OPTION)
Policy Preferred Preferred Standard
Years Plus NT Preferred NT Standard NT Tobacco Tobacco
---------------------------------------------------------------------------------------------------------------
1 0% 0% 0% 0% 0%
2+ 82% 99.5% 89.5% 99% 118%
VUL - FEMALE (FEE ONLY OPTION)
Policy Preferred Preferred Standard
Years Plus NT Preferred NT Standard NT Tobacco Tobacco
---------------------------------------------------------------------------------------------------------------
1% 0% 0% 0% 0% 0%
2+ 80.5% 103.5% 91% 98% 117%
AMOUNTS OVER RATE CAP
Policy Preferred Preferred Standard
Years Plus NT Preferred NT Standard NT Tobacco Tobacco
---------------------------------------------------------------------------------------------------------------
1% 0% 0% 0% 0% 0%
2+ 30% 41% 54% 85% 125%
EXHIBIT III
OTHER ALLOWANCES
XXXXXXX NATIONAL LIFE
Treaty #: 200501-030
-----------------------------------
TEMP FLAT EXTRA
All Years
15%
PERM FLAT EXTRA
1st Year 100%
Renewal 15%
