Common use of STATEMENT OF INVESTMENT POLICY Clause in Contracts

STATEMENT OF INVESTMENT POLICY. The investment policy of the Company, like that of the other portfolios managed for the accounts of Liberty Mutual Insurance Group (“LMIG”), has been formulated with two basic tenets in mind. First, as a property and casualty insurance company, the primary purpose of the investment portfolio is to support the company’s insurance operations and to be consistent with the company’s objectives for long-term financial strength in order to meet its obligations to policyholders. Second, as an insurance company, the preponderance of risk assumed should be in the underwriting of the company’s insurance products, not in the investment of its assets. Within these broad risk parameters, management of the portfolio will focus on maximizing the long-term after-tax total rate of return on invested assets through disciplined asset allocation and security selection, balanced with the need for the portfolio to produce investment income, stable cash flow, and sufficient liquidity. Asset management should also provide safety through adequate diversification of risk, the preservation of principal, and the avoidance of unacceptable levels of asset/liability mismatches. Within this context, individual investment decisions will be based on fundamental economic, financial, credit and security analysis/selection combined with relative value considerations among securities and market sectors. The specific terms and conditions of individual securities and the specific asset’s fit within the total portfolio framework will be evaluated prior to investment. The overall policy will be managed through adherence to a set of broadly defined policy guidelines designed to give the Advisor discretion in meeting portfolio objectives. This investment policy and the investment guidelines, all of which will be reviewed on a periodic basis in conjunction with changing regulatory and business requirements, are subject to the final approval of the Company’s Board of Directors or a duly appointed and authorized committee thereof. The ongoing implementation of the investment policy will be the responsibility of the Advisor through the authority granted by the Company’s Board of Directors. The Advisor consists of the same group of investment professionals responsible for managing the other insurance companies investment assets of LMIG, currently totaling over $50.0 billion. As such, the implementation and maintenance of the investment policy will occur within the same basic framework, as LMIG’s other portfolios and adjusted, when and where appropriate, to accommodate the specific requirements of the Company. All investment related decisions and transactions will be implemented by those individuals with proven abilities to do so effectively and that have been granted that authority by the Company’s Board of Directors through the Chief Investment Officer of LMIG. All investment transactions will be reported to the Board at the regularly scheduled meetings. Appendix B

STATEMENT OF INVESTMENT POLICY. The investment policy of the Company, Company like that of the other portfolios managed for the accounts of Liberty Mutual Insurance Group of Companies (“LMIG”), LMG) has been formulated with two basic tenets in mind. First, as a property and casualty insurance companycompanies, the primary purpose of the investment portfolio is to support the companyCompany’s insurance operations and to be consistent with the companyCompany’s objectives for long-term financial strength in order to meet its obligations to policyholders. Second, as an insurance company, the preponderance of risk assumed should be in the underwriting of the companyCompany’s insurance products, not in the investment of its assets. Within these broad risk parameters, management of the portfolio will focus on maximizing the long-term after-tax total rate of return on invested assets through disciplined asset allocation and security selection, balanced with the need for the portfolio to produce investment income, stable cash flow, and sufficient liquidity. Asset management should also provide safety through adequate diversification of risk, the preservation of principal, and the avoidance of unacceptable levels of asset/liability mismatches. Within this context, individual investment decisions will be based on fundamental economic, financial, credit and security analysis/selection combined with relative value considerations among securities and market sectors. The specific terms and conditions of individual securities and the specific asset’s fit within the total portfolio framework will be evaluated prior to investment. The overall policy will be managed through adherence to a set of broadly defined policy guidelines designed to give the Advisor advisor discretion in meeting portfolio objectives. This investment policy and the investment guidelines, all of which will be reviewed on a periodic basis in conjunction with changing regulatory and business requirements, are subject to the final approval of the Company’s Board of Directors or a duly appointed and authorized committee thereof. The ongoing implementation of the investment policy will be the responsibility of the Advisor investment advisor through the authority granted by the Company’s Board of Directors. The Advisor investment advisor consists of the same group of investment professionals responsible for managing the other insurance companies investment assets of LMIGLMG, currently totaling over $50.0 billion. As such, the implementation and maintenance of the investment policy will occur within the same basic framework, as LMIGLMG’s other portfolios and adjusted, when and where appropriate, to accommodate the specific requirements of the Company. All investment related decisions and transactions will be implemented by those individuals with proven abilities to do so effectively and that have been granted that authority by the Company’s Board of Directors Director through the Chief Investment Officer of LMIGLMG. All investment transactions will be reported to the Board respective Boards at the its regularly scheduled meetings. Appendix B

STATEMENT OF INVESTMENT POLICY. The investment policy of the Company, like that of the other portfolios managed for the accounts of Liberty Mutual Insurance Group (“LMIG”), has been formulated with two basic tenets in mind. First, as a property and casualty insurance company, the primary purpose of the investment portfolio is to support the company’s insurance operations and to be consistent with the company’s objectives for long-term financial strength in order to meet its obligations to policyholders. Second, as an insurance company, the preponderance of risk assumed should be in the underwriting of the company’s insurance products, not in the investment of its assets. Within these broad risk parameters, management of the portfolio will focus on maximizing the long-term after-tax total rate of return on invested assets through disciplined asset allocation and security selection, balanced with the need for the portfolio to produce investment income, stable cash flow, and sufficient liquidity. Asset management should also provide safety through adequate diversification of risk, the preservation of principal, and the avoidance of unacceptable levels of asset/liability mismatches. Within this context, individual investment decisions will be based on fundamental economic, financial, credit and security analysis/selection combined with relative value considerations among securities and market sectors. The specific terms and conditions of individual securities and the specific asset’s fit within the total portfolio framework will be evaluated prior to investment. The overall policy will be managed through adherence to a set of broadly defined policy guidelines designed to give the Advisor discretion in meeting portfolio objectives. This investment policy and the investment guidelines, all of which will be reviewed on a periodic basis in conjunction with changing regulatory and business requirements, are subject to the final approval of the Company’s Board of Directors or a duly appointed and authorized committee thereof. The ongoing implementation of the investment policy will be the responsibility of the Advisor through the authority granted by the Company’s Board of Directors. The Advisor consists of the same group of investment professionals responsible for managing the other insurance companies investment assets of LMIG, currently totaling over $50.0 billion. As such, the implementation and maintenance of the investment policy will occur within the same basic framework, as LMIG’s other portfolios and adjusted, when and where appropriate, to accommodate the specific requirements of the Company. All investment related decisions and transactions will be implemented by those individuals with proven abilities to do so effectively and that have been granted that authority by the Company’s Board of Directors through the Chief Investment Officer of LMIG. All investment transactions will be reported to the Board at the regularly scheduled meetings. Appendix B.