Exhibit 10.1
REINSURANCE AGREEMENT
BETWEEN THE
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
Article I.
BASIS OF REINSURANCE
1. One-hundred percent (100%) of the net benefits (defined in Article II,
Paragraph 1), under all eligible policies (defined in Schedule A) of
NORTHBROOK, will be reinsured with ALLSTATE.
2. This reinsurance will be ceded to ALLSTATE on an automatic coinsurance
basis.
3. In no event will reinsurance under this Agreement be in force unless the
corresponding policy issued by NORTHBROOK or the reinsurance accepted by
NORTHBROOK is in force.
Article II.
REINSURANCE BENEFITS
1. Net benefits are defined as follows:
(a) For a policy issued directly by NORTHBROOK and reinsured under this
Agreement, net benefits are the actual amounts payable by NORTHBROOK
to the policyholder, less any amounts payable to NORTHBROOK by another
reinsurer with respect to the policy. These payments include death
benefits, endowment benefits, annuity benefits, disability benefits,
benefits under A & H policies, surrender benefits and payments on
supplementary contracts with and without life contingencies.
(b) For policies reinsured by NORTHBROOK and retroceded under this
Agreement, net benefits are the actual amounts payable by NORTHBROOK
to the ceding company with respect to the policy reinsured by
NORTHBROOK. These payments will include commissions and expense
allowances on reinsurance accepted.
2. With respect to policies issued directly or reinsured by NORTHBROOK on or
prior to the Effective Date of this Agreement, ALLSTATE's liability for net
benefits will begin on the first day following the Agreement's Effective
Date. This liability will include net benefits incurred on or prior to the
Effective Date of this Agreement, but not paid until after the Agreement's
Effective Date.
3. With respect to policies issued directly or reinsured by NORTHBROOK after
the Effective Date of this Agreement, ALLSTATE's liability for net benefits
will begin simultaneously with that of NORTHBROOK and will include any
liability NORTHBROOK may incur as a result of a Temporary Insurance
Agreement or Conditional Receipt issued in conjunction with a policy
subject to this Agreement.
4. ALLSTATE's liability under this Agreement will continue as long as
NORTHBROOK remains liable on the underlying coverage, and will terminate
simultaneously with NORTHBROOK's termination of liability.
Article III.
RESERVE TRANSFERS
1. On or before the Effective Date of this Agreement, NORTHBROOK shall pay to
ALLSTATE one million dollars ($1,000,000) in cash.
2. Within one-hundred and eighty (180) days following the Effective Date of
this Agreement, NORTHBROOK shall pay to ALLSTATE assets with statutory book
value equal to (a) less (b), where (a) and (b) are as defined below.
NORTHBROOK shall also pay to ALLSTATE interest on this amount; such amount
being equal to the sum of (c) and (d), as defined below.
(a) Net statutory reserves determined as the portion of the following
items (i) through (viii), minus items (ix) through (xi) attributable
to the policies (or portion of such policies) ceded to ALLSTATE under
this Agreement. The applicable portion of these items will be
calculated as of the Effective Date of this Agreement and will be
based on the corresponding items from NORTHBROOK's General Account
statutory financial statement as filed with the Illinois Insurance
Department.
Page 2 of 9
ITEM NAIC STATEMENT REFERENCE* DESCRIPTION
---- ------------------------------- -----------------------------------------------------------------------
(i) Page 3, Line 1 Aggregate reserve for life policies and contracts
(ii) Page 3, Line 2 Aggregate reserve for A & H policies and contracts
(iii) Page 3, Line 3 Supplementary contracts without life contingencies
(iv) Page 3, Lines 4.1 & 4.2 Policy and contract claims
(v) Page 3, Line 9 Premium and annuity considerations received in advance
(vi) Page 3, Lines 10.1, 10.2 & 10.3 Liability for premiums and other deposit funds
(vii) Page 3, Lines 11.1, 11.2 & 11.3 Policy and contract liabilities not included elsewhere
(viii) Page 3, Line 15 Cost of collection on premiums and annuity considerations deferred and
uncollected in excess of total loading
(ix) Page 2, Lines 11.1, 11.2 & 11.3 Reinsurance ceded (amounts due)
(x) Page 2, Line 14 Life insurance premiums and annuity considerations deferred and
uncollected
(xi) Page 2, Line 15 Accident and health premiums due and unpaid
(b) The amount transferred under Article III, Paragraph 1.
(c) All interest payments, dividend payments and mortgage payments
received by NORTHBROOK, between the Effective Date of this Agreement
and the date of asset transfer, on the assets transferred.
(d) Interest on cash transferred at an effective rate of six percent (6%)
per annum, compounded daily, from the Effective Date of this Agreement
to the date of asset transfer.
* References herein are to the 1986 NAIC Statutory Statement. Appropriate
adjustments will be made for changes, if any, in the NAIC Statutory Statement
on or after the Effective Date.
Page 3 of 9
3. Within sixty (60) days following the filing of ALLSTATE's 1987 Federal
Income Tax return, NORTHBROOK shall pay to ALLSTATE assets with statutory
book value equal to 0.4 X [(a)-(b)], where (a) and (b) are as defined
below.
(a) Net statutory reserves on the Effective Date of this Agreement as
calculated under Article III, Paragraph 2, Item (a).
(b) Net tax reserves on the Effective Date of this Agreement for the items
listed in Article III, Paragraph 2, Item (a), as revalued for purposes
of calculating the 1987 Federal Income Tax liability.
4. Within ninety (90) days following the recapture by NORTHBROOK of any
business ceded to another reinsurer, NORTHBROOK shall pay to ALLSTATE
assets with statutory book value equal to (a)X [1+(b)(c)/365], where (a)
through (c) are as defined below.
(a) Net Statutory reserves, as defined in Article III, Paragraph 2, Item
(a), attributable to the policies so recaptured. The applicable
portion of these items will be calculated as of the end of the month
following the date of recapture.
(b) The annual rate of interest appearing on NORTHBROOK's General Account
statutory financial statement (NAIC Statement Reference*: Exhibit 2,
Line 8) as filed with the Illinois Insurance Department as of the end
of the calendar year immediately preceding the date of recapture.
(c) The number of days between the end of the month following the date of
recapture and the date when payment is made.
5. Within sixty (60) days following the filing of an Allstate Federal Income
Tax return for a year in which there was a recapture by NORTHBROOK of any
business ceded to another reinsurer, NORTHBROOK shall pay to ALLSTATE
assets with statutory book value equal to the product of the then current
Federal Income Tax rate applicable to ALLSTATE and the amount (a)-(b),
where (a) and (b) are as defined below.
(a) Net Statutory reserves, as defined in Article III, Paragraph 2, Item
(a), attributable to the policies so recaptured. The applicable
portion of these items will be calculated as of the end of the
calendar year following the date of recapture.
(b) Net tax reserves for the items listed in Article III, Paragraph 2,
Item (a), attributable to the policies so recaptured and as revalued
for purposes of calculating ALLSTATE's Federal Income Tax liability.
The applicable portion of these items will be calculated as of the end
of the calendar year following the date of recapture.
* References herein are to the 1986 NAIC Statutory Statement. Appropriate
adjustments will be made for changes, if any, in the NAIC Statutory Statement
on or after the Effective Date.
Page 4 of 9
Article IV.
MONTHLY SETTLEMENTS
1. Within thirty (30) days following the end of each calendar month in which
this Agreement is in effect, NORTHBROOK shall pay to ALLSTATE, with respect
to eligible policies under this Agreement, a reinsurance premium equal to
(or the accounting equivalent of) the sum of Items (a) and (b) below less
the sum of Items (c), (d) and (e) below.
(a) Gross premiums (direct and reinsurance assumed) collected by
NORTHBROOK during the month.
(b) Reserves transferred from a NORTHBROOK Separate Account to the
NORTHBROOK General Account during the month.
(c) Gross premiums refunded by NORTHBROOK during the month to
policyholders.
(d) Reserves transferred from the NORTHBROOK General Account to a
NORTHBROOK Separate Account during the month.
(e) Reinsurance premiums paid by NORTHBROOK during the month to reinsurers
other than ALLSTATE.
2. Within thirty (30) days following the end of each calendar month in which
this Agreement is in effect, ALLSTATE shall pay to NORTHBROOK a benefit and
expense allowance equal to (or the accounting equivalent of) the sum of
Items (a), (b), (c) and (d) below.
(a) Net benefits (as defined in Article II, Paragraph 1) paid by
NORTHBROOK during the month with respect to the policies ceded under
this Agreement.
(b) Commissions and other sales compensation incurred by NORTHBROOK during
the month with respect to the policies ceded under this Agreement.
(c) General insurance expenses incurred by NORTHBROOK during the month
with respect to the policies ceded under this Agreement.
(d) Insurance taxes, licenses and fees (excluding Federal Income Tax)
incurred by NORTHBROOK during the month with respect to the policies
ceded under this Agreement.
Article V.
OVERSIGHTS
ALLSTATE shall be bound as NORTHBROOK is bound, and it is expressly
understood and agreed that if failure to reinsure or failure to comply with
any terms of this Agreement is shown to be unintentional and the result of
misunderstanding or oversight on the part of either NORTHBROOK or ALLSTATE,
both NORTHBROOK and ALLSTATE shall be restored to the positions they would
have occupied had no such error or oversight occurred.
Page 5 of 9
Article VI.
POLICY CHANGES
If any change is made in coverage reinsured under this Agreement,
NORTHBROOK shall notify ALLSTATE.
Article VII.
RECAPTURE
1. If a policy reinsured under this Agreement becomes ineligible for
reinsurance (as specified in Schedule A), the policy will be immediately
recaptured by NORTHBROOK.
2. NORTHBROOK shall notify ALLSTATE of any such recapture.
3. Upon receiving notice of recapture, ALLSTATE shall pay to NORTHBROOK an
amount equal to the net statutory reserves associated with the recaptured
policy. This amount will be determined in accordance with the formula
defined in Article III, Paragraph 2, Item (a), as of the end of the month
following the date of recapture.
Article VIII.
INSPECTION OF RECORDS
NORTHBROOK and ALLSTATE shall have the right, at any reasonable time, to
examine at the office of the other, any books, documents, reports or
records which pertain in any way to the policies reinsured under this
Agreement.
Article IX.
INSOLVENCY
1. In the event of the insolvency of NORTHBROOK, reinsurance hereunder is
payable by ALLSTATE on the basis of its liability hereunder without
diminution because of the insolvency of NORTHBROOK.
2. Further, in the event of the insolvency of NORTHBROOK, the liquidator,
receiver or statutory successor of the insolvent NORTHBROOK shall give
written notice to ALLSTATE of the pendency of an obligation of the
insolvent NORTHBROOK on any policy reinsured, whereupon ALLSTATE may
investigate such claim and interpose at its own expense, in the proceeding
where such claim is to be adjudicated, any defense or defenses which it may
deem available to NORTHBROOK or its liquidator or statutory successor. The
expense thus incurred by ALLSTATE shall be chargeable, subject to court
approval, against the insolvent NORTHBROOK as part of the expenses of
liquidation to the extent of a proportionate share of the benefit which may
accrue to NORTHBROOK solely as a result of the defense undertaken by
ALLSTATE.
Page 6 of 9
3. All monies due NORTHBROOK or ALLSTATE under this Agreement shall be offset
against each other, dollar for dollar, regardless of any insolvency of
either party.
Article X.
ARBITRATION
Any dispute arising with respect to this Agreement which is not settled by
mutual agreement of the parties shall be referred to arbitration. Within
twenty (20) days from receipt of written notice from one party that an
arbitrator has been appointed, the other party will also name an
arbitrator. The two arbitrators will choose a third arbitrator and will
forthwith notify the contracting parties of such choice. Each arbitrator
should be a present or former officer of a life insurance company and
should have no present or past affiliation with this Agreement or with
either party. The arbitrators will consider this Agreement as an honorable
engagement rather than merely as a legal obligation, and will be relieved
of all judicial formalities. The decision of the arbitrators will be final
and binding upon the parties hereto. Each party shall bear the expenses of
its own arbitrator and shall jointly and equally bear the expenses of the
third arbitrator and of the arbitration. Any such arbitration will take
place at the Home Office of NORTHBROOK, unless some other location is
mutually agreed upon.
Article XI.
PARTIES TO AGREEMENT
This Agreement is solely between NORTHBROOK and ALLSTATE. The acceptance of
reinsurance hereunder does not create any right or legal relation whatever
between ALLSTATE and any party in interest under any policy reinsured
hereunder. NORTHBROOK shall be and remain solely liable to any insured,
contract owner, or beneficiary under any policy reinsured hereunder.
Page 7 of 9
Article XII.
DURATION OF AGREEMENT
This Agreement will be effective as of December 31, 1987, and will be
unlimited as to its duration; provided, however, it may be terminated with
respect to the reinsurance of new business by either party giving sixty
(60) days prior written notice of termination to the other party.
IN WITNESS HEREOF, the parties to this Agreement have caused it to be duly
executed in duplicate by their respective officers on the date shown below.
NORTHBROOK LIFE INSURANCE COMPANY of Northbrook, Illinois
By /s/ Xxxxx X. Xxxxxxxx
---------------------------------
Title Assistant Vice President,
Assistant Secretary & Assistant
General Counsel
-------------------------------
Date October 20, 1987
-------------------------------
ALLSTATE LIFE INSURANCE COMPANY of Northbrook, Illinois
By /s/ Xxxxxx X. Xxxx
-------------------------------
Title Vice President and Controller
-----------------------------
Date October 20, 1987
-----------------------------
[SEAL]
Page 8 of 9
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
Schedule A
ELIGIBLE AND INELIGIBLE POLICIES
1. This Agreement covers all eligible policies in force in NORTHBROOK (or no
longer in force but with remaining liability to NORTHBROOK) on the
Effective Date of this Agreement, all eligible policies issued directly by
NORTHBROOK after the Effective Date of this Agreement, and all reinsurance
accepted by NORTHBROOK before and after the Effective Date of this
Agreement.
2. An eligible policy is defined as any policy whose reserve is invested, in
whole or in part, in the NORTHBROOK General Account; provided, however,
that the portion of any such policy which is not so invested is not
covered under this Agreement.
Page 9 of 9
AMENDMENT NO. 1
to the
REINSURANCE AGREEMENT
between the
NORTHBROOK LIFE INSURANCE COMPANY, Northbrook, Illinois
(hereinafter "NORTHBROOK")
and
ALLSTATE LIFE INSURANCE COMPANY, Northbrook, Illinois
(hereinafter "ALLSTATE")
IT IS HEREBY AGREED that the
Reinsurance Agreement effective December 31,
1987 between NORTHBROOK and ALLSTATE (hereinafter "Coinsurance Agreement"), is
amended as follows:
1. Article II, paragraphs 1(a) and 3 of the Coinsurance Agreement are
amended as set out below:
1. Net benefits are defined as follows:
(a) For an application received, or a policy issued directly by
NORTHBROOK and reinsured under this Agreement, net benefits
are the actual amounts payable by NORTHBROOK to the
policyholder, less any amounts payable to NORTHBROOK by
another reinsurer with respect to the policy. These payments
include death benefits, endowment benefits, annuity
benefits, disability benefits, benefits under accident and
health policies, surrender benefits, and payments on
supplementary contracts with and without life contingencies.
3. With respect to applications received, or policies issued
directly or reinsured by NORTHBROOK, after the Effective Date of
this Agreement, ALLSTATE's liability for net benefits will begin
simultaneously with that of NORTHBROOK and will include any
liability NORTHBROOK may incur as a result of a Temporary
Insurance Agreement or Conditional Receipt issued in conjunction
with a policy subject to this Agreement.
2. Article IV of the Coinsurance Agreement, is deleted, and replaced with
new Article IV set out below:
- 1 -
ARTICLE IV
SETTLEMENTS
1. While this Agreement is in effect, NORTHBROOK shall pay to ALLSTATE no
less frequently than weekly, with respect to eligible policies under
this Agreement, a reinsurance premium equal to (or the accounting
equivalent of) the sum of Items (a), (b) and (c) below, less the sum
of Items (d) and (e) below, as applicable for the period since the
date of NORTHBROOK's last payment to ALLSTATE.
(a) Gross premiums (direct and reinsurance assumed) collected by
NORTHBROOK.
(b) Reserves transferred from a NORTHBROOK Separate Account to the
NORTHBROOK General Account.
(c) Policy loan repayments collected by NORTHBROOK with respect to
the policies ceded under this Agreement.
(d) Gross premiums refunded by NORTHBROOK to policyholders.
(e) Reserves transferred from the NORTHBROOK General Account to the
NORTHBROOK Separate Account.
2. While this Agreement is in effect, ALLSTATE shall pay to NORTHBROOK no
less frequently than weekly a benefit and expense allowance equal to
(or the accounting equivalent of) the sum of Items (a), (b), (c), (d)
and (e) below, as applicable for the period since the date of
ALLSTATE's last payment to NORTHBROOK.
(a) Net benefits (as defined in Article II) paid by NORTHBROOK with
respect to the policies ceded under this Agreement.
(b) Commissions and other sales compensation incurred by NORTHBROOK
with respect to the policies ceded under this Agreement.
(c) General insurance expenses incurred by NORTHBROOK with respect to
the policies ceded under this Agreement.
(d) Insurance taxes, licenses and fees (excluding Federal Income Tax)
incurred by NORTHBROOK with respect to the policies ceded under
this Agreement.
(e) Policy loan distributions to policyholders incurred by NORTHBROOK
with respect to the policies ceded under this Agreement.
This Amendment shall be effective as of September 1, 1990.
- 2 -
IN WITNESS WHEREOF, the parties to the Coinsurance Agreement have caused
their respective officers to execute this Amendment on the dates shown below.
NORTHBROOK LIFE INSURANCE COMPANY
BY: /s/ Xxxxx Xxxxxxxx
-------------------------------
TITLE: Vice President
----------------------------
DATE: June 6, 1991
-----------------------------
ALLSTATE LIFE INSURANCE COMPANY
BY: /s/ XXXXX X. XXXX
-------------------------------
TITLE: Assistant Vice President &
Corporate Actuary
----------------------------
DATE: June 4, 1991
-----------------------------
- 3 -
AMENDMENT No. 2
to the
REINSURANCE AGREEMENT
between
NORTHBROOK LIFE INSURANCE COMPANY, Northbrook, Illinois
(hereinafter "NORTHBROOK")
and
ALLSTATE LIFE INSURANCE COMPANY, Northbrook, Illinois
(hereinafter "ALLSTATE")
IT IS HEREBY AGREED that the 100% Coinsurance
Reinsurance Agreement
effective December 31, 1987, between NORTHBROOK and ALLSTATE is amended as
follows:
1. A new Article VIII is added, to read as follows:
Article VIII
CONVERSION TO FUNDS WITHHELD
(a.) Effective on the date and at the time of transfer of all or
substantially all Assets to NORTHBROOK pursuant to Section 6(f) of the
Security and Trust Agreement among the parties hereto, Xxxx Xxxxxx
Xxxxxxxx, Inc., and Xxxxxx Trust and Savings Bank, the reinsurance
hereunder provided shall convert from an automatic coinsurance basis to a
funds withheld basis. The delivery to the Trustee of the Instructions for
Release to Beneficiary, as provided in Section 6(f) of the Security and
Trust Agreement, shall operate as notice to NORTHBROOK and ALLSTATE of such
conversion. NORTHBROOK shall hold all assets received pursuant to such
transfer, including subsequent additions and investment income, under the
Funds Withheld provisions of this Article.
(b.) In the event of a conversion, as provided in Section (a.) of
this Article VIII, from an automatic coinsurance to a funds withheld basis,
Article IV, MONTHLY SETTLEMENTS, as amended by Amendment No. 1 to this
Reinsurance Agreement, shall be automatically modified to operate as
follows:
(i) In addition to the settlements described in Article IV, which shall
continue, NORTHBROOK shall pay to ALLSTATE no less frequently than
weekly the net investment income, including all realized capital
gains and losses, earned on the assets held in accordance with
Section (a) of this Article VIII.
(ii) Notwithstanding the requirements of Article IV and Section (b) (i) of
this Article VIII, NORTHBROOK shall withhold from ALLSTATE and hold
an amount not greater than the sum A, B and C below, such sum
hereafter referred to as the "Funds Withheld"
A. an amount equal to the net statutory reserves in respect of the
business reinsured;
B. an amount equal to the Interest Maintenance Reserve related to
the Assets held in trust in accordance with Section (a) of this
Article VIII;
C. an amount not greater at any time than 20% of the net statutory
reserves with respect to the business reinsured, equal to the
accumulation, if positive, of the amounts due ALLSTATE from
NORTHBROOK less the amounts due NORTHBROOK from ALLSTATE,
beginning from the date Assets are transferred to NORTHBROOK
pursuant to Section 6(f) of the Security and Trust Agreement.
(iii) The net periodic settlements described in Article IV shall be
adjusted to provide for Funds Withheld by reducing the amount paid to
ALLSTATE by any increase in the Funds Withheld for the settlement
period or increasing the amount paid ALLSTATE by any decrease in the
Funds Withheld.
(c) Notwithstanding any of the foregoing provisions of this Article VIII,
NORTHBROOK shall at all times have the right to use any Assets in its
possession for the payment of benefits due and owing under policies issued
by NORTHBROOK.
2
2. This
Reinsurance Agreement is amended further by renumbering current
Article VIII to be Article IX, and each subsequent Article is renumbered
consecutively from such new Article IX.
3. This
Reinsurance Agreement is amended further by deleting current Article
XII, entitled DURATION OF AGREEMENT, and inserting, in its place, the following:
ARTICLE XIII.
DURATION OF AGREEMENT
This Agreement will be effective as of December 31, 1987, and shall remain
in force so long as any policies issued by NORTHBROOK through Xxxx Xxxxxx
Xxxxxxxx, Inc., pursuant to various General Agent's Agreements, remain in
force.
4. This
Reinsurance Agreement is amended further by adding an Article XIV, to
read as follows:
ARTICLE XIV.
ENTIRE AGREEMENT
This Reinsurance Agreement, together with all amendments thereto and the
Security and Trust Agreement to which ALLSTATE and NORTHBROOK are parties
dated as of September 1, 1993, constitutes the entire agreement between
ALLSTATE and NORTHBROOK with respect to the subject matter hereof, and
there are no written or oral understandings, agreements, conditions, or
qualifications to the terms and conditions of this Reinsurance Agreement
which are not fully expressed herein and in such Security and Trust
Agreement.
3
IN WITNESS HEREOF, the parties to this Agreement have caused this Amendment
No. 2 to be duly executed in duplicate by their respective officers on the date
shown below.
NORTHBROOK LIFE INSURANCE COMPANY, of Northbrook, Illinois
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Xxxxx X. Xxxxxxxx
Title: Vice President
Date: September 28, 0000
XXXXXXXX XXXX XXXXXXXXX XXXXXXX, xx Xxxxxxxxxx, Xxxxxxxx
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------
Xxxxx X. Xxxxxxx
Title: Vice President
Date: September 28, 1933
4
AMENDMENT # 3 TO THE
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
IT IS HEREBY AGREED, that the Coinsurance Agreement effective December 31, 1987
between NORTHBROOK and ALLSTATE (hereafter "Agreement"), is amended as follows;
1.) Schedule A, ELIGIBLE AND INELIGIBLE POLICIES, is hereby amended by
deleting said Schedule in its entirety, and replacing it with the following new
Schedule A:
SCHEDULE A
ELIGIBLE AND INELIGIBLE POLICIES
1. This Agreement covers all eligible policies in force in
NORTHBROOK (or no longer in force but with remaining liability to
NORTHBROOK) on the Effective Date of this Agreement, all eligible
policies issued directly by NORTHBROOK after the Effective Date of
this Agreement, and all reinsurance accepted by NORTHBROOK before and
after the Effective Date of this Agreement.
2. An eligible policy is defined as any policy whose reserve is
invested, in whole or in part, in the NORTHBROOK general account,
except for those policies described in paragraph 3, below; provided,
however, that the portion of any such policy which is not so invested
is not covered under this Agreement.
3. No policy which is registered with the Securities and Exchange
Commission and which is sold to a pension plan as the term "pension
plan" is defined under the Employee Retirement Income Security Act of
1974, including, but not limited to, pension plans qualified under
Sections 401(a), 401(k), and 403(b) of the Internal Revenue Code,
shall be considered an eligible policy under this Agreement.
2.) This Amendment shall be effective February 1, 1995.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
NORTHBROOK LIFE INSURANCE COMPANY ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------- ---------------------------
Title: VP Title: VP, GENERAL COUNSEL & SECY
-------------------------- ---------------------------
Date: 2/28/95 Date: Feb. 23, 1995
-------------------------- ---------------------------
AMENDMENT # 4 TO THE
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
WHEREAS, Northbrook and Allstate entered into a Coinsurance Agreement
(hereinafter "Agreement") having an effective date of December 31, 1987; and,
WHEREAS, the California Insurance Department has determined that various changes
to the Agreement are required under California insurance law; and,
WHEREAS, Northbrook and Allstate desire to amend the Agreement with respect to
coverage issued to California residents to meet the California requirements;
NOW THEREFORE, the Agreement is hereby amended with respect to California
residents, as follows;
1.) Article IX, "INSOLVENCY", is hereby amended by deleting said Article
in its entirety, and replacing it with the following new Article IX.
ARTICLE IX
INSOLVENCY
1. The portion of any risk or obligation assumed by Allstate, when such
portion is ascertained, shall be payable on demand of Northbrook at
the same time as Northbrook shall pay its net retained portion of such
risk or obligation, and the reinsurance shall be payable by Allstate
on the basis of the liability of Northbrook under the contract or
contracts reinsured under this Agreement without diminution because of
the insolvency of Northbrook. In the event of insolvency and the
appointment of a conservator, liquidator or statutory successor of
Northbrook, such portion shall be payable to such conservator,
liquidator or statutory successor immediately upon demand, on the
basis of claims
allowed against Northbrook by any court of competent jurisdiction or,
by any conservator, liquidator, or statutory successor of Northbrook
having authority to allow such claims, without diminution because of
such insolvency or because such conservator, liquidator or statutory
successor has failed to pay all or a portion of any claims. Payments
by Allstate as above set forth shall be made directly to Northbrook or
its conservator, liquidator or statutory successor.
2. Further, in the event of the insolvency of Northbrook, the liquidator,
receiver or statutory successor of the insolvent Northbrook shall give
written notice to Allstate of the pendency of an obligation of the
insolvent Northbrook on any policy reinsured, whereupon Allstate may
investigate such claim and interpose at its own expense, in the
proceeding where such claim is to be adjudicated, any defense or
defenses which it may deem available to Northbrook or its liquidator
or statutory successor. The expense thus incurred by Allstate shall be
chargeable, subject to court approval, against the insolvent
Northbrook as part of the expenses of liquidation to the extent of a
proportionate share of the benefit which may accrue to Northbrook
solely as a result of the defense undertaken by Allstate
2.) Article X, ARBITRATION, shall be amended to include the following
language at the end of that article:
The decision of the Arbitrators shall be handed down within
45 days of the date on which the arbitration is concluded.
3.) Article XII, PARTIES TO THE AGREEMENT, shall be deleted in its
entirety and shall be replaced with the following language:
This Agreement shall be effective as of December 31, 1987,
and will be unlimited as to its duration; provided, however,
it may be terminated with respect to the reinsurance of new
business by either party giving the other party ninety (90)
days prior written notice of termination to the other party.
4.) Article VII, paragraph 1(c) as amended in Amendment No. 2 shall be
deleted in its entirety and shall be replaced with the following language:
(c) Notwithstanding any of the foregoing provisions of this Article
VII, NORTHBROOK shall at all times have the right to use any Assets in
its possession for the payment of benefits due and owing under
policies issued by NORTHBROOK. Provided, however, NORTHBROOK will not
use any such Assets to satisfy any liabilities under the Northbrook
Separate Account.
5.) In addition, a new Article XIII is added to the Agreement, as follows:
ARTICLE XIII
OFFSET
All monies due Northbrook or Allstate under this Agreement shall
be offset against each other dollar for dollar.
6.) Further, a new Article XIV is added to the agreement, as follows:
ARTICLE XIV
ENTIRE AGREEMENT
This Agreement constitutes the entire contract between ALLSTATE
and NORTHBROOK. No variation, modification or changes to this
Agreement shall be binding unless in writing and signed by an
officer of each party.
This Amendment shall be effective on June 12, 1995. Except as amended hereby,
the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to
be duly executed in duplicate by their respective officers on the dates shown
below.
NORTHBROOK LIFE INSURANCE COMPANY ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxx
------------------------- ------------------
Title: First Vice President Title: AVP
------------------------- ------------------
Date: 6/12/95 Date: 6/12/95
------------------------- ------------------
AMENDMENT NUMBER 5
TO THE REINSURANCE AGREEMENT
EFFECTIVE DECEMBER 31, 0000
XXXXXXX
XXXXXXXXXX LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "ALLSTATE")
IT IS HEREBY AGREED, that the Reinsurance Agreement effective December 31, 1987
between NORTHBROOK and ALLSTATE (hereinafter "Agreement"), is amended as
provided below.
1. Effective January 1, 1995, Article IV is hereby amended by adding the
following new subparagraph 3:
3. ALLSTATE shall pay to NORTHBROOK, no less frequently than annually,
any taxes incurred by NORTHBROOK as a result of Section 848 of the
Internal Revenue Code which concerns capitalization of policy
acquisition costs.
2. Effective January 1, 1993, Article IV is hereby amended by adding the
following new subparagraph 4:
4. ALLSTATE and NORTHBROOK agree to an election under Treasury
Regulations 1-848-2(g)(8), as follows:
(a) For each taxable year under this Agreement, the party with net
positive consideration, as defined in the regulations promulgated
under Treasury Code Section 848, will capitalize specified policy
acquisition expenses with respect to this Agreement without
regard to the general deductions limitation of Section 848(c)(1);
(b) NORTHBROOK and ALLSTATE agree to exchange information pertaining
to the amount of net consideration for all reinsurance agreements
in force between them to ensure consistency for purposes of
computing specified policy acquisition expenses. NORTHBROOK and
ALLSTATE shall agree on the amount of such net consideration for
each taxable year no later than the May 1 following the end of
such year.
(c) This election shall be effective for 1993 and for all subsequent
taxable years for which this Agreement remains in effect.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
Page 1 of 2
Northbrook Life Insurance Company
By /s/ Xxxxx X. Xxxxxxx
----------------------------------
Title VP
-------------------------------
Date 1/26/96
--------------------------------
Allstate Life Insurance Company
By /s/ C. Xxxxxx Xxxxx
----------------------------------
Title AVP
-------------------------------
Date 1/26/96
--------------------------------
Page 2 of 2
AMENDMENT NO. 6 TO THE
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
IT IS HEREBY AGREED, that the Coinsurance Agreement effective December 31, 1987
between NORTHBROOK and ALLSTATE (hereafter "Agreement"), is amended as follows:
1.) Schedule A, ELIGIBLE AND INELIGIBLE POLICIES, is hereby amended by
deleting said Schedule in its entirety, and replacing it with the following new
Schedule A:
SCHEDULE A
ELIGIBLE AND INELIGIBLE POLICIES
1. This Agreement covers all eligible policies in force in NORTHBROOK (or
no longer in force but with remaining liability to NORTHBROOK) on the
Effective Date of this Agreement, all eligible policies issued
directly by NORTHBROOK after the Effective Date of this Agreement, and
all reinsurance accepted by NORTHBROOK before and after the Effective
Date of this Agreement.
2. An eligible policy is defined as any policy whose reserve is invested,
in whole or in part, in the NORTHBROOK general account, provided,
however, that the portion of any such policy which is not so invested
is not covered under this Agreement.
2.) This Amendment shall be effective December 30, 1996.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
NORTHBROOK LIFE INSURANCE ALLSTATE LIFE INSURANCE
COMPANY COMPANY
By: /s/ Xxxxx X. Xxxxxxx By: /s/ C. Xxxxxx Xxxxx
---------------------------- --------------------------
Title: Assistant Vice President Title: Assistant Vice President &
---------------------------- Corporate Actuary
--------------------------
Date: January 15, 1997 Date: January 15, 1997
---------------------------- --------------------------
AMENDMENT NUMBER 7
TO THE REINSURANCE AGREEMENT
EFFECTIVE DECEMBER 31, 0000
XXXXXXX
XXXXXXXXXX LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "ALLSTATE")
WHEREAS, NORTHBROOK and ALLSTATE entered into a Reinsurance Agreement effective
December 31, 1987 (hereinafter "Agreement"); and
WHEREAS, the parties now believe that the Agreement does not accurately reflect
their existing practices relating to settlements for certain tax benefits and
liabilities; and
WHEREAS, the parties desire to amend the Agreement to reflect the existing
practices with respect to such tax settlements;
NOW, THEREFORE, IT IS HEREBY AGREED, that the Agreement is amended as provided
below.
1.) Article IV, paragraph 2, is amended by replacing subparagraph (d) with
a new subparagraph (d), as follows:
(d) Insurance taxes, licenses and fees (excluding Federal Income Tax
that is not related to the contracts reinsured under this Agreement),
incurred by NORTHBROOK with respect to the contracts reinsured under
this Agreement.
2.) Article IV is further amended by adding a new paragraph 3, as follows:
3. No less frequently than quarterly, ALLSTATE will calculate the
amount of federal and state income tax liabilities incurred by
Page 1 of 2
NORTHBROOK for the quarter related to the contracts reinsured under
this Agreement, and the amount of federal and state income tax
benefits earned by NORTHBROOK for the quarter related to the contracts
reinsured under this Agreement. If tax liabilities exceed tax
benefits, the difference, plus a gross-up for additional federal and
state income taxes, will be paid by ALLSTATE to NORTHBROOK. If tax
benefits exceed tax liabilities, the difference, plus a gross-up for
additional federal and state income taxes, will be paid by NORTHBROOK
to ALLSTATE.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
Northbrook Life Insurance Company
By /s/ [ILLEGIBLE]
------------------------------
Title Assistant Vice President
------------------------------
Date October 22, 1998
------------------------------
Allstate Life Insurance Company
By /s/ [ILLEGIBLE]
------------------------------
Title AVP
------------------------------
Date 10/22/98
------------------------------
Page 2 of 2
Exhibit 10.2
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
Article I
BASIS OF REINSURANCE
1. ALLSTATE will indemnify and NORTHBROOK will automatically reinsure with
ALLSTATE, according to the terms and conditions hereof, the net liability
for contracts in force (or no longer in force but with remaining liability)
on the Effective Date and contracts directly issued subsequent to the
Effective Date by NORTHBROOK on the contracts listed in Schedule A.
2. The indemnity reinsurance provided hereunder shall be on a modified
coinsurance basis. NORTHBROOK shall retain, maintain, and own all assets
held in relation to the Reserve, as defined in Article III.
3. In no event will reinsurance under this Agreement be in force with respect
to a contract of NORTHBROOK unless such contract is in force.
Article II
LIABILITY OF ALLSTATE
The liability of ALLSTATE with respect to any contract reinsured hereunder will
begin simultaneously with that of NORTHBROOK, but not prior to the Effective
Date of this Agreement. ALLSTATES'S liability with respect to any contract
reinsured hereunder will terminate on the date NORTHBROOK's liability on such
contract terminates or the date this Agreement is terminated, whichever is
earliest. However, termination of this Agreement will not terminate ALLSTATE's
liability for benefit payments incurred prior to the date of termination.
Page 1 of 6
Article III
INITIAL CONSIDERATION
1. On the Effective Date of this Agreement, NORTHBROOK will pay ALLSTATE an
initial consideration which shall be equal to (or the accounting equivalent
of) one hundred (100) percent of the Reserve, as defined in Paragraph 2 of
this Article III, as of the Effective Date of this Agreement, with respect
to the contracts reinsured hereunder.
2. For the purpose of this Agreement, the term "Reserve" will be the total
liability for the reinsured contracts corresponding to the sum of the
amounts on page 3, line 18 of NORTHBROOK's Statutory Separate Account
(excluding Variable Life) Statement and page 3, line 12 of NORTHBROOK's
Statutory Variable Life Separate Account Statement.
Article IV
MONTHLY SETTLEMENTS
1. Within thirty (30) days following the end of each calendar month in which
this Agreement is in effect, NORTHBROOK shall pay to ALLSTATE, with respect
to contracts reinsured under this Agreement, a reinsurance premium equal to
(or the accounting equivalent of) the sum of Items (a) and (b) below less
the sum of Items (c), (d) and (e) below.
(a) Gross premiums (direct and reinsurance assumed) collected by
NORTHBROOK during the month.
(b) Reserves transferred from the NORTHBROOK General Account to a
NORTHBROOK Separate Account during the month.
(c) Gross premiums refunded by NORTHBROOK during the month to
policyholders.
(d) Reserves transferred from a NORTHBROOK Separate Account to the
NORTHBROOK General Account during the month.
(e) Reinsurance premiums paid by NORTHBROOK during the month to reinsurers
other than ALLSTATE.
2. Within thirty (30) days following the end of each calendar month in which
this Agreement is in effect, ALLSTATE shall pay to NORTHBROOK a benefit and
expense allowance equal to (or the accounting equivalent of) the sum of
Items (a), (b), (c) and (d) below.
(a) Net benefits (as defined in Paragraph 3 of this Article IV) paid by
NORTHBROOK during the month with respect to the contracts reinsured
under this Agreement.
(b) Commissions and other sales compensation incurred by NORTHBROOK during
the month with respect to the contracts reinsured under this
Agreement.
(c) General insurance expenses incurred by NORTHBROOK during the month
with respect to the contracts reinsured under this Agreement.
(d) Insurance taxes, licenses and fees (excluding Federal Income Tax)
incurred by NORTHBROOK during the month with respect to the contracts
reinsured under this Agreement.
Page 2 of 6
3. Net Benefits are defined as follows:
(a) For a contract issued directly by NORTHBROOK and reinsured under this
Agreement, net benefits are the actual amounts payable by NORTHBROOK
to the policyholder, less any amounts payable to NORTHBROOK by another
reinsurer with respect to the contract. These payments include death
benefits, endowment benefits, annuity benefits, disability benefits,
benefits under A & H policies, surrender benefits and payments on
supplementary contracts with and without life contingencies.
(b) For contracts reinsured by NORTHBROOK and retroceded under this
Agreement, net benefits are the actual amounts payable by NORTHBROOK
to the ceding company with respect to the contract reinsured by
NORTHBROOK. These payments will include commissions and expense
allowances on reinsurance accepted.
Article V
MONTHLY RESERVE ADJUSTMENTS
1. Simultaneously with the payment of the initial consideration described in
Article III, Xxxxxxxxx 0, XXXXXXXX will pay to NORTHBROOK an initial
reserve adjustment in an amount that is equal to the Reserve on the
Effective Date of this Agreement with respect to the contracts reinsured
hereunder.
2. Within thirty (30) days following the end of each calendar month in which
this Agreement is in effect, a reserve adjustment equal to (or the
accounting equivalent of) the amount defined below shall be paid.
Let:
RC = The Reserve change from the end of the prior accounting period to
the end of the current accounting period for the reinsured
contracts corresponding to the sum of the amounts on page 4,
lines 9, 10, 10A and 11 of NORTHBROOK's Statutory Separate
Account (excluding Variable Life) Statement and page 4, lines 14
and 15 of NORTHBROOK's Statutory Variable Life Separate Account
Statement.
NII = The net investment income corresponding to the sum of the
amounts on page 4, line 2 of NORTHBROOK's Statutory Separate
Account (excluding Variable Life) Statement and page 4, lines 4
and 5 of NORTHBROOK's Statutory Variable Life Separate Account
Statement.
If RC is greater than NII then a reserve adjustment of RC-NII is payable by
ALLSTATE to NORTHBROOK.
If NII is greater than RC, then a reserve adjustment of NII-RC is payable
by NORTHBROOK to ALLSTATE.
Page 3 of 6
Article VI
STATEMENT REFERENCES
All references in this Agreement are to the 1986 NAIC Statutory General and
Separate Account Statements of NORTHBROOK, as filed with the Illinois Insurance
Department. Appropriate adjustments will be made for changes, if any, in the
NAIC Statutory General and Separate Account Statements on or after the Effective
Date.
Article VII
OVERSIGHTS
ALLSTATE shall be bound as NORTHBROOK is bound, and it is expressly understood
and agreed that if failure to reinsure or failure to comply with any terms of
this Agreement is shown to be unintentional and the result of misunderstanding
or oversight on the part of either NORTHBROOK or ALLSTATE, both NORTHBROOK and
ALLSTATE shall be restored to the positions they would have occupied had no such
error or oversight occurred.
Article VIII
INSPECTION OF RECORDS
NORTHBROOK and ALLSTATE shall have the right, at any reasonable time, to examine
at the office of the other, any books, documents, reports or records which
pertain in any way to the contracts reinsured under this Agreement.
Article IX
INSOLVENCY
1. In the event of the insolvency of NORTHBROOK, reinsurance hereunder is
payable by ALLSTATE on the basis of its liability hereunder without
diminution because of the insolvency of NORTHBROOK.
2. Further, in the event of the insolvency of NORTHBROOK, the liquidator,
receiver or statutory successor of the insolvent NORTHBROOK shall give
written notice to ALLSTATE of the pendency of any obligation of the
insolvent NORTHBROOK on any policy reinsured, whereupon ALLSTATE may
investigate such claim and interpose at its own expense, in the proceeding
where such claim is to be adjudicated, any defense or defenses which it may
deem available to NORTHBROOK or its liquidator or statutory successor. The
expense thus incurred by ALLSTATE shall be chargeable, subject to court
approval, against the insolvent NORTHBROOK as part of the expenses of
liquidation to the extent of a proportionate share of the benefit which may
accrue to NORTHBROOK solely as a result of the defense undertaken by
ALLSTATE.
3. All moneys due NORTHBROOK or ALLSTATE under this agreement shall be offset
against each other, dollar for dollar, regardless of any insolvency of
either party.
Article X
ARBITRATION
Any dispute arising with respect to this Agreement which is not settled by
mutual agreement of the parties shall be referred to arbitration. Within
Page 4 of 6
twenty (20) days from receipt of written notice from one party that an
arbitrator has been appointed, the other party shall also name an arbitrator.
The two arbitrators shall choose a third arbitrator and shall forthwith notify
the contracting parties of such choice. Each arbitrator shall be a present or
former officer of a life insurance company and should have no present or past
affiliation with this Agreement or with either party. The arbitrators shall
consider this Agreement as a honorable engagement rather than merely as a legal
obligation, and shall be relieved of all judicial formalities. The decision of
the arbitrators shall be final and binding upon the parties hereto. Each party
shall bear the expenses of its own arbitrator and shall jointly and equally bear
the expenses of the third arbitrator and of the arbitration. Any such
arbitration shall take place at the Home Office of NORTHBROOK, unless some other
location is mutually agreed upon.
Article XI
PARTIES TO AGREEMENT
This Agreement is solely between NORTHBROOK and ALLSTATE. The acceptance of
reinsurance hereunder shall not create any right or legal relation whatever
between ALLSTATE and any party in interest under any contract of NORTHBROOK
reinsured hereunder. NORTHBROOK shall be and remain solely liable to any
insured, contract owner, or beneficiary under any contract reinsured hereunder.
This Agreement will be effective as of December 31, 1987, and will be unlimited
as to its duration; provided, however, it may be terminated with respect to the
reinsurance of new business by either party giving the other party sixty (60)
days prior written notice of termination to the other party.
IN WITNESS HEREOF, the parties to this Agreement have caused it to be duly
executed in duplicate by their respective officers on the dates shown below.
NORTHBROOK LIFE INSURANCE COMPANY of Northbrook, Illinois
By /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Title Assistant Vice President,
Assistant Secretary &
Assistant General Counsel
--------------------------
Date October 20, 1987
--------------------------
ALLSTATE LIFE INSURANCE COMPANY of Northbrook, Illinois
By /s/ Xxxxxx X. Xxxx
-----------------------------
Title Vice President and Controller
-----------------------------
Date October 20, 1987
--------------------------
Page 5 of 6
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
SCHEDULE A
CONTRACTS SUBJECT TO REINSURANCE UNDER THIS TREATY
Any contract whose reserve is invested, in whole or in part, in any account
designated as a NORTHBROOK Separate Account shall be reinsured under this
Agreement; provided, however, that the portion of any such contract which is not
so invested is not covered under this Agreement.
Page 6 of 6
AMENDMENT NO. 1
to the
REINSURANCE AGREEMENT
between the
NORTHBROOK LIFE INSURANCE COMPANY, Northbrook, Illinois
(hereinafter "NORTHBROOK")
and
ALLSTATE LIFE INSURANCE COMPANY, Northbrook, Illinois
(hereinafter "ALLSTATE")
IT IS HEREBY AGREED that the Reinsurance Agreement effective December 31,
1987 between NORTHBROOK and ALLSTATE (hereinafter "Modified Coinsurance
Agreement"), is amended as follows:
1. Article IV, paragraphs 1 and 2 of the Modified Coinsurance Agreement,
are deleted, and replaced with new paragraphs 1 and 2 set out below:
1. While this Agreement is in effect, NORTHBROOK shall pay to
ALLSTATE on a daily basis, with respect to eligible policies
under this Agreement, a reinsurance premium equal to (or the
accounting equivalent of) the sum of Items (a) and (b) below,
less the sum of Items (c) and (d) below.
(a) Gross premiums (direct and reinsurance assumed) collected by
NORTHBROOK.
(b) Reserves transferred from the NORTHBROOK General Account to
a NORTHBROOK Separate Account.
(c) Gross premiums refunded by NORTHBROOK to policyholders.
(d) Reserves transferred from a NORTHBROOK Separate Account to
the NORTHBROOK General Account.
2. While this Agreement is in effect, ALLSTATE shall pay to
NORTHBROOK on a daily basis a benefit and expense allowance
equal to (or the accounting equivalent of) the sum of Items (a),
(b), (c) and (d) below.
(a) Net benefits (as defined in Paragraph 3 of this Article IV)
paid by NORTHBROOK with respect to the contracts reinsured
under this Agreement.
(b) Commissions and other sales compensation incurred by
NORTHBROOK with respect to the contracts reinsured under
this Agreement.
(c) General insurance expenses incurred by NORTHBROOK with
respect to the contracts reinsured under this Agreement.
- 1 -
(d) Insurance taxes, licenses and fees (excluding Federal Income
Tax) incurred by NORTHBROOK with respect to the contracts
reinsured under this Agreement.
2. Article IV is further amended by adding new sub-paragraph 4 set out
below:
4. Allstate shall pay to NORTHBROOK, no less frequently than
annually, any taxes incurred by NORTHBROOK as a result of Section
848 of the Internal Revenue Code which concerns capitalization of
policy acquisition costs.
3. Article V, paragraph 2, is deleted, and replaced with the following
new paragraph 2:
2. While this Agreement is in effect, on a daily basis a reserve
adjustment equal to (or the accounting equivalent of) the amount
defined below shall be paid.
Let:
RC = The Reserve change from the end of the prior accounting
period to the end of the current accounting period for
the reinsured contracts corresponding to the sum of
the amounts on page 4, lines 10, 11, 12 and 13 of
NORTHBROOK's Statutory Separate Account (excluding
Variable Life) Statement.
NII = The net investment income corresponding to the sum of the
amounts on page 4, line 2 of NORTHBROOK's Statutory
Separate Account (excluding Variable Life) Statement,
minus interest income on NORTHBROOK's capital
investment.
If RC is greater than NII then a reserve adjustment of RC-NII is
payable by ALLSTATE to NORTHBROOK.
If NII is greater than RC, then a reserve adjustment of NII-RC is
payable by NORTHBROOK to ALLSTATE.
This Amendment shall be effective as of September 1, 1990.
- 2 -
IN WITNESS WHEREOF, the parties to have caused their respective officers to
execute this Amendment on the dates shown below.
NORTHBROOK LIFE INSURANCE COMPANY
BY: /s/ Xxxxx Xxxxxxxx
---------------------------------
TITLE: Vice President
------------------------------
DATE: June 6, 1991
-------------------------------
ALLSTATE LIFE INSURANCE COMPANY
BY: /s/ Xxxxx X. Xxxx
---------------------------------
TITLE: Assistant Vice President &
Corporate Actuary
------------------------------
DATE: June 4, 1991
-------------------------------
- 3 -
AMENDMENT # 2 TO THE
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
WHEREAS, Northbrook and Allstate entered into a Modified Coinsurance Agreement
(hereinafter "Agreement") having an effective date of December 31, 1987; and,
WHEREAS, the California Insurance Department has determined that various changes
to the Agreement are required under California insurance law; and,
WHEREAS, Northbrook and Allstate desire to amend the Agreement with respect to
coverage issued to California residents to meet the California requirements;
NOW THEREFORE, the Agreement is hereby amended with respect to California
residents, as follows;
1.) Article IX, "INSOLVENCY", is hereby amended by deleting said Article in
its entirety, and replacing it with the following new Article IX.
ARTICLE IX
INSOLVENCY
1. The portion of any risk or obligation assumed by Allstate, when such
portion is ascertained, shall be payable on demand of Northbrook at
the same time as Northbrook shall pay its net retained portion of such
risk or obligation, and the reinsurance shall be payable by Allstate
on the basis of the liability of Northbrook under the contract or
contracts reinsured under this Agreement without diminution because of
the insolvency of Northbrook. In the event of insolvency and the
appointment of a conservator, liquidator or statutory successor of
Northbrook, such portion shall be payable to such conservator,
liquidator or statutory successor immediately upon demand, on the
basis of claims
allowed against Northbrook by any court of competent jurisdiction or,
by any conservator, liquidator, or statutory successor of Northbrook
having authority to allow such claims, without diminution because of
such insolvency or because such conservator, liquidator or statutory
successor has failed to pay all or a portion of any claims. Payments
by Allstate as above set forth shall be made directly to Northbrook or
its conservator, liquidator or statutory successor.
2. Further, in the event of the insolvency of Northbrook, the liquidator,
receiver or statutory successor of the insolvent Northbrook shall give
written notice to Allstate of the pendency of an obligation of the
insolvent Northbrook on any policy reinsured, whereupon Allstate may
investigate such claim and interpose at its own expense, in the
proceeding where such claim is to be adjudicated, any defense or
defenses which it may deem available to Northbrook or its liquidator
or statutory successor. The expense thus incurred by Allstate shall be
chargeable, subject to court approval, against the insolvent
Northbrook as part of the expenses of liquidation to the extent of a
proportionate share of the benefit which may accrue to Northbrook
solely as a result of the defense undertaken by Allstate
2.) Article X, ARBITRATION, shall be amended to include the following
language at the end of that article:
The decision of the Arbitrators shall be handed down within
45 days of the date on which the arbitration is concluded.
3.) The second paragraph of Article XI, PARTIES TO THE AGREEMENT, shall be
deleted in its entirety and shall be replaced with the following language:
This Agreement shall be effective as of December 31, 1987,
and will be unlimited as to its duration; provided, however,
it may be terminated with respect to the reinsurance of new
business by either party giving the other party ninety (90)
days prior written notice of termination to the other party.
4.) In addition, a new Article XII is added to the Agreement, as follows:
ARTICLE XII
OFFSET
All monies due Northbrook or Allstate under this Agreement shall be offset
against each other dollar for dollar.
5.) Further, a new Article XIII is added to the agreement, as follows:
ARTICLE XIII
ENTIRE AGREEMENT
This Agreement constitutes the entire contract between ALLSTATE
and NORTHBROOK. No variation, modification or changes to this
Agreement shall be binding unless in writing and signed by an
officer of each party.
6.) Finally, the definition of "RC" in Article V, paragraph 2, is deleted,
and replaced with the following language:
RC = The Reserve change from the end of the prior accounting
period to the end of the current accounting period for the
reinsured contracts corresponding to the sum of the amounts
on page 4, lines 10, 11, 12 and 13 of NORTHBROOK's Statutory
Separate Account Statement. An accounting period shall be
defined as one day.
This Amendment shall be effective on June 8, 1995. Except as amended hereby, the
Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
NORTHBROOK LIFE INSURANCE COMPANY ALLSTATE LIFE INSURANCE COMPANY
By: /s/ M Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
------------------------- ----------------------------
Title: Vice President Title: VP, Secy & Gen Counsel
------------------------ ---------------------------
Date: June 8, 1995 Date: June 8, 1995
------------------------- ----------------------------
AMENDMENT # 3 TO THE
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
IT IS HEREBY AGREED, that the Modified Coinsurance Agreement effective December
31, 1987 between NORTHBROOK and ALLSTATE (hereafter "Agreement"), is amended as
follows;
1.) Schedule A, CONTRACTS SUBJECT TO REINSURANCE UNDER THIS TREATY, is
hereby amended by deleting said Schedule in its entirety, and replacing it with
the following new Schedule A:
SCHEDULE A
CONTRACTS SUBJECT TO REINSURANCE UNDER THIS TREATY
I. Any contract whose reserve is invested, in whole or in part,
in any account designated as a NORTHBROOK Separate Account shall
be reinsured under this Agreement; provided, however, that
portion of any such contract which is not invested is not covered
under this Agreement.
II. Any contract registered with the Securities and Exchange
Commission which is sold to a pension plan as the term "pension
plan" is defined under the Employee Retirement Income Security
Act of 1974, including, but not limited to, pension plans
qualified under Sections 401(a), 401(k) and 403(b) of the
Internal Revenue Code.
2.) This Amendment shall be effective February 1, 1995.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
NORTHBROOK LIFE INSURANCE COMPANY ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Xxxxx Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
------------------------- ----------------------------
Title: VP Title: VP, General Counsel & Secy
----------------------- --------------------------
Date: 2/28/95 Date: Feb. 23, 1995
------------------------- ---------------------------
AMENDMENT NUMBER 4
TO THE REINSURANCE AGREEMENT
EFFECTIVE DECEMBER 31, 0000
XXXXXXX
XXXXXXXXXX LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "ALLSTATE")
IT IS HEREBY AGREED, that the Reinsurance Agreement effective December 31, 1987
between NORTHBROOK and ALLSTATE (hereinafter "Agreement"), is amended as
provided below.
Effective January 1, 1993, Article IV is hereby amended by adding the following
new sub-paragraph 5:
5. ALLSTATE and NORTHBROOK agree to an election under Treasury
Regulations 1-848-2(g)(8), as follows:
(a) For each taxable year under this Agreement, the party
with net positive consideration, as defined in the
regulations promulgated under Treasury Code Section
848, will capitalize specified policy acquisition
expenses with respect to this Agreement without regard
to the general deductions limitation of Section
848(c)(1);
(b) NORTHBROOK and ALLSTATE agree to exchange information
pertaining to the amount of net consideration for all
reinsurance agreements in force between them to ensure
consistency for purposes of computing specified policy
acquisition expenses. NORTHBROOK and ALLSTATE shall
agree on the amount of such net consideration for each
taxable year no later than the May 1 following the end
of such year.
(c) This election shall be effective for 1993 and for all subsequent
taxable years for which this Agreement remains in effect.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
Northbrook Life Insurance Company
By /s/ Xxxxx X. Xxxxxxx
------------------------
Title VP
------------------------
Date 1/26/96
------------------------
Page 1 of 2
Allstate Life Insurance Company
By /s/ C. Xxxxxx Xxxxx
--------------------------
Title AVP
-----------------------
Date 1/24/95
------------------------
Page 2 of 2
AMENDMENT NO. 5 TO THE
REINSURANCE AGREEMENT
BETWEEN
NORTHBROOK LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY, NORTHBROOK, ILLINOIS
(HEREINAFTER "ALLSTATE")
IT IS HEREBY AGREED, that the Modified Coinsurance Agreement effective December
31, 1987 between NORTHBROOK and ALLSTATE (hereafter "Agreement"), is amended as
follows:
1.) Schedule A, CONTRACTS SUBJECT TO REINSURANCE UNDER THIS TREATY, is
hereby amended by deleting said Schedule in its entirety, and replacing it with
the following new Schedule A:
SCHEDULE A
CONTRACTS SUBJECT TO REINSURANCE UNDER THIS TREATY
Any contract whose reserve is invested, in whole or in part, in
any account designated as a NORTHBROOK Separate Account shall be
reinsured under this Agreement; provided, however, that the
portion of any such contract which is not so invested is not
covered under this Agreement.
2.) This Amendment shall be effective December 30, 1996.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
NORTHBROOK LIFE INSURANCE COMPANY ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxx By: /s/ C. Xxxxxx Xxxxx
------------------------- -----------------------------
Title: Assistant Vice President Title: Assistant Vice President &
------------------------- Corporate Actuary
-----------------------------
Date: January 15, 1997 Date: January 15, 1997
------------------------- -----------------------------
AMENDMENT NUMBER 6
TO THE REINSURANCE AGREEMENT
EFFECTIVE DECEMBER 31, 0000
XXXXXXX
XXXXXXXXXX LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "NORTHBROOK")
AND
ALLSTATE LIFE INSURANCE COMPANY
(HEREINAFTER CALLED "ALLSTATE")
WHEREAS, NORTHBROOK and ALLSTATE entered into a Reinsurance Agreement effective
December 31, 1987 (hereinafter "Agreement"); and
WHEREAS, the parties now believe that the Agreement does not accurately reflect
their existing practices relating to settlements for certain tax benefits and
liabilities; and
WHEREAS, the parties desire to amend the Agreement to reflect the existing
practices with respect to such tax settlements;
NOW, THEREFORE, IT IS HEREBY AGREED, that the Agreement is amended as provided
below.
1.) Article IV, paragraph 2, is amended by replacing subparagraph (d) with
a new subparagraph (d), as follows:
(d) Insurance taxes, licenses and fees (excluding Federal Income Tax
that is not related to the contracts reinsured under this Agreement),
incurred by NORTHBROOK with respect to the contracts reinsured under
this Agreement.
2.) Article IV is further amended by adding a new paragraph 5, as follows:
Page 1 of 2
5. No less frequently than quarterly, ALLSTATE will calculate the
amount of federal and state income tax liabilities incurred by
NORTHBROOK for the quarter related to the contracts reinsured under
this Agreement, and the amount of federal and state income tax
benefits earned by NORTHBROOK for the quarter related to the contracts
reinsured under this Agreement. If tax liabilities exceed tax
benefits, the difference, plus a gross-up for additional federal and
state income taxes, will be paid by ALLSTATE to NORTHBROOK. If tax
benefits exceed tax liabilities, the difference, plus a gross-up for
additional federal and state income taxes, will be paid by NORTHBROOK
to ALLSTATE.
Except as amended hereby, the Agreement shall remain unchanged.
IN WITNESS HEREOF, the parties to the Agreement have caused this Amendment to be
duly executed in duplicate by their respective officers on the dates shown
below.
Northbrook Life Insurance Company
By /s/ Xxxxx X. Xxxxxxx
-----------------------------
Title Assistant Vice President
-----------------------------
Date October 22, 1998
-----------------------------
Allstate Life Insurance Company
By /s/ C. Xxxxxx Xxxxx
-----------------------------
Title AVP
-----------------------------
Date 10/22/98
-----------------------------
Page 2 of 2
