Exhibit 1-A(8)(c)(2)
AMENDMENT NO. 2
The Modified Coinsurance Agreement between American Franklin Life Insurance
Company of Springfield, Illinois and Integrity Life Insurance Company of
Phoenix, Arizona, effective April 1, 1989, is amended as follows:
I. The following is added to Section E. "Terms of Reinsurance":
6. CLAIMS
The settlement made by the REINSURED for a death claim under a
policy reinsured under this agreement shall be binding on the
REINSURER. However, the REINSURER shall be consulted before any
admission of liability on the claim is made by the REINSURED if
the claim amount reinsured is equal to or greater than $200,000
or when death occurs during the contestable period. The
REINSURED shall furnish the REINSURER with copies of the proofs
of loss and any information the REINSURER may request.
II. Schedule II is replaced by the attached Schedule II, revised 5/2/90.
III. Schedule V is replaced by the attached Schedule V, revised
5/2/90.
AMERICAN FRANKLIN LIFE INSURANCE COMPANY
By: By:
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Title: Senior Vice President, Title: Senior Vice President and
General Counsel and Actuary
Secretary
Date: May 16, 1990 Date: May 16, 1990
INTEGRITY LIFE INSURANCE COMPANY
By: By:
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Title: Vice President and Chief Title: Vice President & CFO
Actuary
Date: May 4, 1990 Date: May 4, 1990
SCHEDULE II
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AMOUNT OF REINSURANCE
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The portion of the risk reinsured under this Agreement shall be 30% on any
policy to the extent reinsured hereunder, as provided in Schedule I, in
accordance with the following rules:
1. There shall be no reinsurance on any benefit under this Agreement
where the REINSURED does not retain its normal retention of risk on a
policy hereunder.
2. There shall be no reinsurance on policies issued as term conversions
or replacements where full evidence of insurability has not been
secured which were: (a) originally written by The Franklin Life
Insurance Company; (b) not reinsured; and (c) where the original
underwriting occurred over five years prior to submission of the case
to American Franklin.
3. There shall be no reinsurance on policies issued as term conversions
from or replacements of policies originally issued by The Franklin
Life Insurance Company, which were originally reinsured under other
reinsurance agreements.
4. There shall be no reinsurance on an automatic basis for any risk
offered on a facultative basis by the reinsured to any company.
Revised 5/2/90
SCHEDULE V
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ADMINISTRATION CHARGE
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1. tor each policy issued and reinsured during a calendar year he
REINSURER shall pay the REINSURED $30.00 (30% of $100.00) to cover
issue and underwriting expenses incurred by the REINSURED.
However, if such policy is a term conversion from or a replacement of
a policy originally written by The Franklin Life Insurance Company,
where full evidence of insurability has not been secured, the
REINSURER shall pay the REINSURED a reduced amount of $15 (30% of
$50.00).
2. The REINSURER shall pay the REINSURED each year an amount to cover
administrative expenses incurred by the REINSURED. This amount shall
be calculated by multiplying $3.00 (30% of $10.00) by .5 times the
following:
(a) the number of reinsured policies in force at the end of the prior
calendar year, plus
(b) the number of policies in force at the end of the current
calendar year, plus
(c) the number of policies issued and reinsured during the current
calendar year.
The above unit charges will apply during the first year of this agreement and
will subsequently be redetermined to follow future experience.
Revised 5/2/90
