FACULTATIVE YEARLY RENEWABLE TERM
REINSURANCE AGREEMENT
between
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
and
THE CANADA LIFE ASSURANCE COMPANY
April 1, 2003
ARTICLES
I. Parties to the Agreement 3
II. Reinsurance Coverage 3
III. Liability 3
IV. Notification of Reinsurance 4
V. Reinsurance Premiums 4
VI. Reserves 6
VII. Oversights 7
VIII. Conversions 7
IX. Reductions, Terminations, and Changes 7
X. Increase in Retention 8
XI. Reinstatement 10
XII. Expenses 10
XIII. Claims 10
XIV. Extra-Contractual Damages 14
XV. Inspection of Records 14
XVI. DAC Tax - Section 1.848-2 (g)(8) Election 14
XVII. Insolvency 15
XVIII. Offset 16
XIX. Arbitration 16
XX. Termination 18
XXI. General Provisions 18
XXII. Confidentiality 20
XXIII. Notices and Communications 20
XXIV. Effective Date 21
XXV. Execution 21
SCHEDULES
A. Plans Covered under This Agreement 22
B. Basis of Reinsurance 25
EXHIBITS
I. Reinsurance Premium Calculation 26
II. Retention, Binding, and Issue Limits 27
III. Annual per 1000 YRT Reinsurance Rates 28
IV. Sample Administrative Reports 29
ALL SCHEDULES AND EXHIBITS ATTACHED WILL BE CONSIDERED PART OF THIS REINSURANCE
AGREEMENT.
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ARTICLE I
PARTIES TO THE AGREEMENT
This Agreement is between Hartford Life and Annuity Insurance Company (referred
to as the Ceding Company), and The Canada Life Assurance Company (referred to as
the Reinsurer).
The acceptance of risks under this Agreement will create no right or legal
relationship between the Reinsurer and the insured owner or beneficiary of any
insurance policy or contract of the Ceding Company. This Agreement will be
binding upon the Ceding Company and the Reinsurer and their respective
successors and assignees.
ARTICLE II
REINSURANCE COVERAGE
Reinsurance under this Agreement will apply to insurance issued by the Ceding
Company on the Plans of Insurance shown in Schedule A. Such Plans of Insurance
shall be reinsured with the Reinsurer on a facultative basis subject to the
requirements set forth in Section A below. The specifications for all
reinsurance under this Agreement are provided in Schedule B.
A. Requirements for Facultative Reinsurance
The Ceding Company will send copies of all of the papers or facsimiles relating
to the insurability of the individual risk to the Reinsurer. After the Reinsurer
has examined the request, the Reinsurer will promptly notify the Ceding Company
of the underwriting offer subject to additional requirements or the final
underwriting offer. The final underwriting offer on the individual risk will
automatically terminate upon the earlier of the withdrawal of the application or
120 days from the date of the final offer, unless coverage is accepted or put in
place earlier.
The individual risk must be underwritten according to the Ceding Company's
standard issue practices and guidelines.
B. Basis of Reinsurance
Reinsurance under this Agreement will be on the basis as stated in Schedule B.
C. Policy Forms
When requested, the Ceding Company will furnish the Reinsurer with a copy of
each policy, rider, rate book, and applicable sales or marketing material that
applies to the life insurance reinsured hereunder.
ARTICLE III
LIABILITY
A. The Reinsurer's liability will begin simultaneously with the Ceding
Company's liability once the Reinsurer has accepted the application and the
Ceding Company has accepted the offer.
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B. In no event shall the reinsurance be in force and binding if the issuance
and delivery of such insurance constituted the doing of business in a
jurisdiction in which the Ceding Company was not properly licensed.
C. The Reinsurer's liability for reinsurance on the individual risk will
terminate when the Ceding Company's liability terminates.
D. The Reinsurer shall establish reserves on the Reinsurer's portion of the
policy on the reserve basis specified in Article VI.
ARTICLE IV
NOTIFICATION OF REINSURANCE
A. The Ceding Company will notify the Reinsurer on the monthly statement as
described in Article V.
B. When reinsurance is reduced or changed, the Ceding Company will notify the
Reinsurer on the monthly accounting statement.
ARTICLE V
REINSURANCE PREMIUMS
A. Computation
Premiums for reinsurance under this Agreement will be computed as described in
Exhibit I.
B. Premium Accounting
1. Payment of Reinsurance Premiums
Following the close of each calendar month, the Ceding Company will
send the Reinsurer a statement and a listing of new business, changes,
and terminations, similar to Exhibit IV. The Reinsurer will refund to
the Ceding Company all unearned Annual YRT Reinsurance Premiums not
including policy fees, less applicable allowances, arising from
reductions, terminations and changes as described in Article IX.
Annual YRT Reinsurance Premiums, as calculated in Exhibit I, based on
the Reinsured Net Amount at Risk, as defined in Schedule B, are paid
annual in advance each month for those new policies with an effective
date during the previous month and for those renewal policies with a
policy anniversary date during the current month. If a net reinsurance
premium balance is payable to the Reinsurer, the Ceding Company will
forward this balance within thirty (30) days after the close of each
month.
If a net reinsurance premium balance is payable to the Ceding Company,
the balance due will be subtracted from the reinsurance premium
payable by the
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Ceding Company for the current month. The Reinsurer shall pay any
remaining balance due the Ceding Company within forty-five (45) days
after the Ceding Company submits the statement.
If an overpayment is not returned to the Ceding Company promptly or
there is overdue premiums due to the Reinsurer, the party that is due
payment reserves the right to charge interest on reinsurance payments
due. The interest will be calculated according to the 90 Day Federal
Government Treasury rate as first published in the Wall Street Journal
in the month following the end of the billing period plus 50 basis
points. The method of calculation will be simple interest "Bankers'
Rule" (or 360 day year).
2. Termination Because of Non-Payment of Premium
If undisputed reinsurance premiums are delinquent, the Reinsurer has
the right to terminate the reinsurance risks of those policies by
giving the Ceding Company ninety (90) days advance written notice. If
the delinquent premiums have not been paid as of the close of the (90)
ninety-day period, the Reinsurer's liability will terminate for the
risks described in the delinquency notice.
Regardless of the termination, the Ceding Company will continue to be
liable to the Reinsurer for all unpaid reinsurance premiums earned up
to the date of termination.
3. Reinstatement of a Delinquent Statement
The Ceding Company may reinstate the terminated risks within sixty
(60) days after the effective date of termination by paying the unpaid
reinsurance premiums for the risks in force prior to the termination
as defined in Article V -- B1 above. However, the Reinsurer will not
be liable for any claim incurred between the date of termination and
reinstatement. The effective date of reinstatement will be the date
the required back premiums are received.
4. Currency
The reinsurance premiums and benefits payable under this Agreement
will be payable in the lawful money of the United States.
5. Detailed Listing
The Ceding Company will send the Reinsurer an electronic detailed
listing of all reinsurance in force, similar to Exhibit IV, thirty
(30) days after the end of each quarter.
6. Guaranteed Rates
The Reinsurer does not guarantee the rates in this treaty but intends
to charge these rates indefinitely. In the event that the Reinsurer
does increase rates, except as noted below, the Ceding Company shall
have the right to recapture the business as of the date of notice of
rate change. At this date of recapture, the Reinsurer in addition to
any other amounts due, shall transfer an amount equal to
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If however, the Ceding Company raises the rates charged to their
customers, the Reinsurer shall have the right to raise rates without
the allowed recapture stated above. However, this increase to the
reinsurance rates shall be no more than proportional to the increase
to the policy owners' cost of insurance rates.
7. Overpayment of Premium
If the Ceding Company overpays a reinsurance premium and the Reinsurer
accepts the overpayment, the Reinsurer's acceptance will not
constitute nor create a reinsurance liability nor result in any
additional reinsurance. Instead, the Reinsurer will be liable to the
Ceding Company for a credit in the amount of the overpayment.
8. Underpayment of Premium
If the Ceding Company fails to make a full premium payment for a
policy or policies reinsured hereunder, due to an oversight defined in
Article VII, the amount of reinsurance coverage provided by the
Reinsurer shall not be reduced. However, once the underpayment is
discovered, the Ceding Company will be required to pay to the
Reinsurer the difference between the full premium amount and the
amount actually paid, without interest. If payment or the full premium
is not made within sixty (60) days after the discovery of the
underpayment, the underpayment shall be treated as a failure to pay
premiums and subject to the conditions of Section B.2, above.
ARTICLE VI
RESERVES
A. Statutory Reserves for the Mortality Risk of the Policy
[Redacted]
B. Representations
The Reinsurer represents to the Ceding Company that the Reinsurer is properly
licensed or accredited so that the Ceding Company may claim statutory reserve
credit in its financial statements filed in all states and the U.S. territories
of American Samoa, Guam, Puerto Rico and the U.S. Virgin Islands, in which the
Ceding Company is licensed to transact insurance business. In the event that as
a result of a change in the Reinsurer's licensing or accreditation status, due
to an action taken on behalf of the Reinsurer, the Ceding Company must obtain
security for statutory reserve credits taken with respect to
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this Agreement, the Reinsurer will take all actions necessary or appropriate to
ensure that the Ceding Company is able to claim such reserve credit on its
statutory statements, including but not limited to establishing a trust or
letter of credit in a form which meets all applicable standards of law and
regulation. The Reinsurer will bear the expense of establishing any trusts or
letters of credit with respect to this provision.
ARTICLE VII
OVERSIGHTS
If there is an unintentional oversight, misunderstanding, delay or error in the
administration of this Agreement by the Ceding Company or the Reinsurer, it can
be corrected provided the correction takes place within a reasonable time after
the oversight, misunderstanding, delay, or error is first discovered. Both the
Ceding Company and the Reinsurer will be restored to the position they would
have occupied had the oversight or misunderstanding not occurred. Should it not
be possible to restore both parties to such a position, the Ceding Company and
the Reinsurer shall negotiate in good faith to equitably apportion any resulting
liabilities and expenses.
This section shall not apply to applications for facultative reinsurance for
which the Reinsurer has not received written notification that its offer of
facultative reinsurance has been accepted by the Ceding Company in accordance
with Article III.
ARTICLE VIII
CONVERSIONS
Conversions from existing term plans of insurance reinsured under this Agreement
will be reinsured using the YRT premiums attached as Exhibit I on a point in
scale basis up to the original face amount. The converted policy will be
reinsured with the Reinsurer in the same proportion as was determined for the
original term policy. A term conversion is a contractual right of the
policyholder to replace a term policy with a permanent policy without evidence
of insurability.
ARTICLE IX
REDUCTIONS, TERMINATIONS AND CHANGES
A. Replacement or Change
If there is a contractual change, the insurance will continue to be reinsured
with the Reinsurer at point-in-scale rates. If an exchange is requested where
the death benefit is increased, the Reinsurer must consent to the change.
Exchanges from one single life plan reinsured under this Agreement to a
different single life plan will be reinsured at point-in-scale rates. An
exchange is a new policy replacing an existing policy where the new policy is
not fully underwritten.
B. Increases or Decreases
1. In the event of a reduction in the face amount of a policy, the
Reinsurer's
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percentage of the reduced face amount shall be the same percentage as
set at issue.
2. A request to increase the face amount of policies that are reinsured
will be submitted to the Reinsurer for acceptance.
C. Reduction in Retained Coverage
If any portion of the aggregate insurance retained by the Ceding Company on an
individual life reduces or terminates, the Ceding Company will recalculate its
retention on any remaining risk(s) inforce on that life with the intent of
holding the appropriate retention under each applicable reinsurance agreement.
The retention limit, which was in effect at the time that each remaining risk
was issued, will be used. The Ceding Company will not be required to retain an
amount in excess of its regular retention limit for the age, mortality rating,
and risk classification at the time of issue for any policy. The Ceding Company
will first recalculate the retention on the policy(ies) having the same
mortality rating as the terminated policy(ies). Order of recalculation will
secondarily be determined by policy effective date, oldest first.
D. Multiple Reinsurers
If a risk is shared by more than one reinsurer, the Reinsurer's percentage of
any increased or reduced reinsurance will be the same as its initial percentage
of the reinsurance for that risk.
E. Termination
If the policy for a risk reinsured under this Agreement is terminated, the
reinsurance for the risk involved will be terminated on the effective date of
termination.
F. Mortality Rating
If the Ceding Company wishes to reduce the mortality rating, this reduction will
be subject to the Reinsurer's approval.
ARTICLE X
INCREASE IN RETENTION
A. If the Ceding Company should increase the retention limits as listed in
Exhibit II, prompt written notice of the increase must be given to the
Reinsurer.
B. In the event of an increase in retention, the Ceding Company will have the
option of recapturing the reinsurance up to the increased retention under this
Agreement. The Ceding Company may exercise its option to recapture by giving
written notice to the Reinsurer within (90) ninety days after the effective date
of the increase.
C. Whenever the Ceding Company increases its maximum retention limits over the
Ceding Company's Maximum Limits of Retention, as set forth in Exhibit II, the
Ceding Company has the option to recapture certain risk amounts. If the Ceding
Company has maintained
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its maximum stated retention (not a special retention limit) for the plan and
the insured's issue age, sex, and mortality classification in effect at the time
the reinsurance was ceded to the Reinsurer, or if the Ceding Company did not
retain insurance on the life, it may apply its increased retention limits to
reduce the amount of reinsurance as follows:
1. The reduction in reinsurance will become effective on the next
annual premium anniversary after the individual policy has been
inforce for at least twenty (20) years.
2. If more than one policy per life is eligible for recapture, then the
eligible policies may be recaptured beginning with the policy with
the earliest issue date and continuing in chronological order
according to the remaining policies' issue dates.
3. It is understood that the Ceding Company will not re-cede the
business once it has been recaptured for a period of at least three
(3) years unless the Reinsurer agrees to accept this business.
4. If any reinsured policy is recaptured, all reinsured policies
eligible for recapture under the provisions of this Article must be
recaptured up to the Ceding Company's new maximum retention limits
in a consistent manner and the Ceding Company must increase its
total amount of insurance on each reinsured life. The Ceding Company
may not revoke its election to recapture for policies becoming
eligible at future anniversaries.
5 If portions of the reinsured policy have been ceded to more than one
reinsurer, the Ceding Company must allocate the reduction in
reinsurance so that the amount reinsured by each reinsurer after the
reduction is proportionately the same as if the new maximum dollar
retention limits had been in effect at the time of issue.
6. The amount of reinsurance eligible for recapture is based on the
Total Net Amount at Risk (as defined in Schedule B) as of the date
of recapture. For a policy issued as a result of a conversion, the
recapture terms of the reinsurance agreement covering the original
policy will apply, and the duration period for the purpose of
recapture will be measured from the effective date of reinsurance on
the original policy.
7. The terms and conditions for the Ceding Company to recapture
reinsured policies, as a result of the insolvency of the Reinsurer,
are set forth in Article XVII.
8. Cessions Under Waiver of Premium Claim: If there is a reinsured
waiver of premium claim in effect when recapture takes place, the
Reinsurer will continue to pay its share of the waiver claim until
it terminates. The Reinsurer will not be liable for any other
benefits, including the basic life risk, that are eligible for
recapture. All such eligible benefits will be recaptured as if there
were no waiver claim in effect.
9. After the effective date of recapture, the Reinsurer will not be
liable for any reinsured policies or portions of such reinsured
policies eligible for recapture that the Ceding Company has
overlooked.
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ARTICLE XI
REINSTATEMENT
If an insurance policy lapses for nonpayment of premium and is reinstated under
the Ceding Company's terms and rules, the Reinsurer will reinstate the
reinsurance as follows:
A. Facultative Cases
Whenever an application is made by the policyholder for reinstatement in
accordance with the terms of the policy, the policy was originally reinsured
facultatively, and the reinstatement occurs ninety (90) days or more after the
policy has lapsed, copies of such application for reinstatement, any personal
declaration or medical examination and any other underwriting document shall be
forwarded by the Ceding Company to the Reinsurer together with an application
for reinstatement of the reinsurance. The Reinsurer shall notify the Ceding
Company within three (3) business days of its acceptance or declination of the
application for reinstatement.
Upon the Reinsurer's approval, the Ceding Company must pay the Reinsurer all
back reinsurance premiums in the same manner as the Ceding Company received
insurance charges or premiums under the policy. In the event that the policy is
redated, the reinsurance premiums payable shall be at the appropriate policy
year rate.
B. Nonforfeiture Reinsurance Termination
If the Ceding Company has been requested to reinstate a policy that was
reinsured while on extended term or reduced paid-up, then such reinsurance will
terminate and facultative reinstatement procedures will be followed as outlined
above in this Article.
ARTICLE XII
EXPENSES
The Ceding Company must pay the expense of all medical examinations, inspection
fees and other charges in connection with the issuance of the insurance.
ARTICLE XIII
CLAIMS
A. Liability
If the Ceding Company is liable for insurance benefits on a policy reinsured
under this Agreement, the Reinsurer shall be liable for its portion of the
reinsurance on that policy, as described in Schedule B. All reinsurance claim
settlements will be subject to the terms and conditions of the particular
contract and statutory requirements under which the Ceding Company is liable.
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B. Notification
The Ceding Company shall report promptly to the Reinsurer the following
information:
- Name of Insured
- Date of Birth of the Insured
- Date of Death (if this information is available at the time of this
initial notification)
- Company Code
- Policy Number
- Policy Date
- Face Amount
- Retention of the Ceding Company
- Amount Reinsured
- Treaty
Such claim made upon the Ceding Company shall be accepted by the Reinsurer as a
claim upon it for the amount of reinsurance in force on the date the claim is
incurred.
For claims incurred during the contestable period on risks ceded to the
Reinsurer on a facultative basis where the Ceding Company has the intent to
rescind, the Ceding Company shall submit all papers in connection with the claim
to the Reinsurer.
C. Claim Payment
1. Facultative Reinsurance on a Risk
If a claim is made on a risk reinsured facultatively under this
Agreement, the Ceding Company shall submit to the Reinsurer all
relevant and/or requested documents and papers related to the claim
along with the Ceding Company's recommendation. Upon receipt by the
Reinsurer, the Ceding Company shall then wait five (5) business days
during which time the Reinsurer shall have the opportunity to advise
the Ceding Company of its consent or disagreement with the
recommendation. In the event the Reinsurer does not contact the Ceding
Company within the (5) five-day period, the Reinsurer shall be deemed
to have approved the recommendation and the Ceding Company shall be
authorized to act accordingly.
The parties shall use best efforts to reach mutual agreement with
respect to the submitted claim before the Ceding Company responds to
the claimant.
2. Payment of Reinsurance Proceeds
The Reinsurer shall reimburse the Ceding Company for its proportionate
share of any interest paid on claims. The Reinsurer will pay the
Ceding Company the reinsurance proceeds within fifteen (15) business
days of final notification of the Ceding Company making the final
decision to pay the policy proceeds, unless the claim amount is
disputed.
If either by the terms of the contract or by the exercise of an
option, payment under the policy is deferred or made in installments,
the Reinsurer shall nevertheless make payment immediately in one sum,
upon receipt of proper notification stated in (B) above.
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3. Recapture
If an undisputed net amount due to the Ceding Company is thirty (30)
days past due, the Ceding Company shall provide the Reinsurer written
notice, addressed to a senior officer of the Reinsurer, that includes
(1) an itemization of the unpaid claims, and (2) a reminder that the
Ceding Company will have the right to offset and subsequently
recapture all business reinsured if such claims remain unpaid ninety
(90) days past the due date. The sixty (60) day period between the
Reinsurer written notice and ninety (90) days past the due date shall
be called the "Cure Period".
If the Reinsurer is delinquent, ninety (90) days past due, on an
undisputed net amount due to the Ceding Company, the Ceding Company
will have the right to offset such amounts from any amounts due the
Reinsurer in accordance with Article XVIII. To the extent there is an
insufficient balance from which to offset such amounts and the
resulting amount due exceeds the Ceding
Company shall have the right to recapture immediately upon the
termination of the Cure Period.
4. Overdue Reinsurance Proceeds
The Ceding Company reserves the right to charge interest on
reinsurance proceeds due. The interest will be calculated according
to the 90 Day Federal Government Treasury rate as first published in
the Wall Street Journal in the month following the end of the billing
period plus 50 basis points. The method of calculation will be simple
interest "Bankers' Rule" (or 360 day year).
5. Waiver of Premium
If Waiver of Premium is reinsured under this Agreement, then in the
event of a total disability claim, the Ceding Company shall continue
to pay the Reinsurer the reinsurance premium. However, the Ceding
Company will not pay the reinsurance premium for the waiver benefit
for the duration of the waiver claim period. The Reinsurer shall pay
the Ceding Company its share of the gross premium being waived,
including any rider or supplementary benefit gross premiums being
waived, taking into account any fractions of a year for which
premiums have been waived. The Reinsurer will pay waiver benefits
annually regardless of the mode of premium payment specified in the
policy.
6. Interest
If payment under the policy is delayed and interest is allowed per
statutory requirement or the contract, the Reinsurer will pay
interest on the reinsurance at the same rate and for the same time
period as the Ceding Company.
D. Contests, Denials, Litigation, Reduced Settlements and Compromises
The Ceding Company shall promptly notify the Reinsurer of any claim the Ceding
Company plans to contest, deny, litigate or compromise ("Contest"). The Ceding
Company shall also furnish details of such action on request and shall furnish
an itemized reinsurance claim form of expenses incurred thereby.
Once the Reinsurer receives all requested documents, the Reinsurer shall notify
the Ceding Company in writing of the Reinsurer's decision whether or not to
participate in the Contest. If the Reinsurer notifies the Ceding Company in
writing that it has elected not to participate in the Contest, the Reinsurer
shall immediately pay the Ceding
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Company its share of the claim and expenses and not share in any subsequent
increase or reduction. Once the Reinsurer has paid its share, it shall not be
liable for any additional expenses associated with the Contest.
When the Reinsurer agrees in writing to participate on a Contest, involving
reinsurance, it shall share in the payment of legal or investigative expenses
relating to the claim in the same proportion as the Reinsurer's liability bears
to the Ceding Company's liability. The Reinsurer shall not reimburse expenses
associated with non-reinsured policies. If the Ceding Company's Contest results
in a reduction or increase in the liability of the contested policy, the
Reinsurer shall share in the reduction or increase proportional to their share
of the Total Net Amount at Risk (as defined in Schedule B) on the date of death
of the insured.
E. Misstatement of Age or Sex
If the amount of insurance provided by the policy or policies reinsured under
this Agreement is increased or reduced because of misstatement of age or sex
established after the death of the insured, the Reinsurer will share with the
Ceding Company in this increase or reduction. The face amount of the reinsured
policy will be adjusted from the inception of the policy, and any difference
will be settled without interest.
F. Routine Expenses
The Ceding Company will pay the routine expenses incurred in connection with
settling claims. These expenses may include compensation of agents and employees
and the cost of routine investigations.
G. Non-Routine Expenses
The Reinsurer will share with the Ceding Company all expenses that are not
routine. Expenses that are not routine are those directly incurred in connection
with the contest or the possibility of a contest of a claim or the assertion of
defenses, including legal expenses. The expenses will be shared in proportion to
the Total Net Amount at Risk, as defined in Schedule B, for the Ceding Company
and the Reinsurer. However, if the Reinsurer has released the liability under
Section D of this Article, the Reinsurer will not share in any expenses incurred
after the date of the Reinsurer's release.
H. Return of Premium for Misrepresentations and Suicides
If a misrepresentation on an application or a death of an insured risk by
suicide results in the Ceding Company returning the policy premiums to the
policy owner rather than paying the policy benefits, the Reinsurer will refund
all of the reinsurance premiums it received on that policy to the Ceding Company
without interest. This refund given by the Reinsurer will be in lieu of all
other reinsurance benefits payable on that policy under this Agreement.
I. Contestable Period
If during the contestable period, Ceding Company is notified of the death of the
insured, the Ceding Company will investigate the case.
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ARTICLE XIV
EXTRA-CONTRACTUAL DAMAGES
In no event will the Reinsurer have any liability for any extra-contractual
damages, which are awarded against the Ceding Company as a result of acts,
omissions, or course of conduct committed solely by the Ceding Company with no
involvement of the Reinsurer in connection with the insurance reinsured under
this Agreement.
The Reinsurer will, however, pay its share of punitive and/or compensatory
damages and/or statutory penalties awarded against the Ceding Company in
connection with benefits reinsured under this Agreement if the Reinsurer agreed
in writing to the act or course of conduct of the Ceding Company that resulted
in the assessment of such damages.
The Reinsurer does recognize that circumstances may arise under which the
Reinsurer, in equity, should share, to the extent permitted by law, in paying
certain assessed damages. Such circumstances are difficult to define in advance,
but by example may involve those situations in which the Reinsurer was an active
party and, in writing, recommended, consented to or explicitly ratified the act,
omission, or course of conduct of the Ceding Company that ultimately resulted in
the assessment of such damages. The extent of such sharing is dependent on good
faith assessment of culpability in each case, but all factors being equal, the
division of any such assessment would be in the proportion of Total Net Amount
at Risk (as defined in Schedule B) accepted by each party for the plan of
insurance involved.
ARTICLE XV
INSPECTION OF RECORDS
Each party or their authorized representatives will have the right, at any
reasonable time and upon reasonable notice, to inspect the other party's books
and documents that relate to reinsurance under this Agreement.
ARTICLE XVI
DAC TAX
SECTION 1.848-2(g)(8) ELECTION
A. The Ceding Company and the Reinsurer jointly agree to the DAC Tax Election
pursuant to Section 1.848-2(g)(8) of the Income Tax Regulations (the "Treasury
Regulations") issued under Section 848 of the Internal Revenue Code of 1986, as
amended (the "Code") whereby:
(i) The party with the net positive consideration for this Agreement for
each taxable year will capitalize specified policy acquisition
expenses with respect to this Agreement without regard to the
general deductions limitation of Code section 848(c)(1); and
(ii) Both parties agree to exchange information pertaining to the amount
of net consideration under this Agreement each year to ensure
consistency.
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B. As used in this Article XVI, the terms "net positive consideration",
"specified policy acquisition expenses" and "general deductions limitation" are
defined by reference to Treasury Regulations Section 1.848-2 and Code Section
848 as of April 1, 2003.
C. The method and timing of the exchange of this information shall be as
follows:
(i) The Ceding Company shall submit a schedule to the Reinsurer by May 1
of each year of its calculation of the net consideration for the
preceding calendar year.
(ii) The Reinsurer shall, in turn, complete the schedule by indicating
acceptance of the Ceding Company's calculation of net consideration
or shall note in writing any discrepancies. The Reinsurer shall
return the completed schedule to the Ceding Company by June 1 of
each year.
(iii) If there are any discrepancies between the Ceding Company's and the
Reinsurer's calculation of net consideration, the parties shall act
in good faith to resolve these discrepancies in a manner that is
acceptable to both parties by July 1 of each year.
(iv) Each party shall attach the final schedule to their respective U.S.
federal income tax returns for each taxable year in which
consideration is transferred under this Agreement. The schedule
shall identify this Agreement and restate the election described in
this Article XVI and shall be signed by both parties.
D. This DAC Tax Election shall be effective on the effective date of this
Agreement and shall be effective for all years for which this Agreement remains
in effect.
E. The Ceding Company and the Reinsurer each represent and warrant that they
are subject to U.S. taxation under either the provisions of Subchapter L of
Chapter 1 or Subpart F of Part III of Subchapter N of Chapter 1 of the Code.
F. Should the Reinsurer breach the representation and warranty of tax status
set forth in this Article of this Agreement, the Reinsurer agrees to indemnify
and hold the Ceding Company, its directors, officers, employees, agents, and
shareholders harmless from any liability and all liability, loss, damages,
fines, penalties, interest, and reasonable attorney's fees, which the Ceding
Company, its directors, officers, employees, agents, and shareholders may
sustain by reason of such breach.
ARTICLE XVII
INSOLVENCY
A. Insolvency of the Reinsurer
If the Reinsurer becomes insolvent as determined by the Regulatory Agency
responsible for such determination, amounts due the Reinsurer will be paid net
of the terms of this Agreement and directly to the liquidator, receiver, or
statutory successor without decrease. In addition, upon the Reinsurer's
insolvency, the Ceding Company may cancel this Agreement for future new business
as described in Article XX. All reinsurance ceded under this Agreement may be
recaptured by the Ceding Company as of the date the Reinsurer fails to meet its
obligations under this Agreement.
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B. Insolvency of the Ceding Company
If the Ceding Company should become insolvent, as determined by the Regulatory
Agency responsible for such determination, all reinsurance under this Agreement
will be payable by the Reinsurer directly to the Ceding Company's liquidator,
receiver or statutory successor, on the basis of the liability of the Ceding
Company under the policy or policies reinsured and without diminution because of
the insolvency of the Ceding Company. However, in the event of such insolvency,
the liquidator, receiver, or statutory successor will give written notice of a
pending claim against the Ceding Company on the reinsured policy. It will do so
within a reasonable time after the claim is filed in the insolvency proceedings.
During the pendency of such a claim, the Reinsurer may investigate the claim and
may, at its own expense, interpose any defense or defenses, which it may deem
available to the insolvent Ceding Company, its liquidator, receiver, or
statutory successor, in the proceedings where the claim is to be adjudicated.
The expense thus incurred by the Reinsurer will be chargeable against the
insolvent Ceding Company, subject to court approval, as part of the expense of
liquidation to the extent of a proportionate share of the benefit, which may
accrue to the insolvent Ceding Company solely as a result of the defense
undertaken by the Reinsurer.
Where two or more reinsurers are involved in the same claim and a majority in
interest elect to interpose defense to the claim, the expense will be
apportioned in accord with the terms of the reinsurance agreement as though the
expense had been incurred by the insolvent Company.
ARTICLE XVIII
OFFSET
Any undisputed debts or credits, matured or unmatured, liquidated or
unliquidated, regardless of when they arose or were incurred, in favor of or
against either the Ceding Company or the Reinsurer with respect to this
Agreement, shall be offset, and only the balance shall be allowed or paid. In
the event the Ceding Company becomes insolvent, offsets shall be allowed in
accordance with applicable law.
ARTICLE XIX
ARBITRATION
The Ceding Company and the Reinsurer mutually understand and agree that the
wording and interpretation of this Agreement is based on the usual customs and
practice of the insurance and reinsurance industry. While both the Ceding
Company and the Reinsurer agree to act in good faith in its dealings with each
other, it is understood and recognized that situations may arise in which they
cannot reach an agreement.
In the event that any dispute cannot be resolved to mutual satisfaction, the
dispute will first be subject to good-faith negotiation as described below in an
attempt to resolve the dispute without the need to institute formal arbitration
proceedings.
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Within ten (10) days after one of the parties has given the other the first
written notification of the specific dispute, each of the parties will appoint a
designated officer to attempt to resolve the dispute. The officers will meet at
a mutually agreeable location as early as possible and as often as necessary, in
order to gather and furnish the other with all appropriate and relevant
information concerning the dispute. The officers will discuss the problem and
will negotiate in good faith without the necessity of any formal arbitration
proceedings. During the negotiation process, all reasonable requests made by one
officer to the other for information will be honored. The designated officers
will decide the specific format for such discussions.
If the officers cannot resolve the dispute within thirty (30) days of their
first meeting, both parties agree that they will submit the dispute to formal
arbitration. However, the parties may agree in writing to extend the negotiation
period for an additional thirty (30) days.
No later than fifteen (15) days after the final negotiation meeting, the
officers taking part in the negotiation will give both the Ceding Company and
the Reinsurer written confirmation that they are unable to resolve the dispute
and that they recommend establishment of formal arbitration.
An arbitration panel consisting of three (3) past or present officers of life
insurance or life reinsurance companies not affiliated with either of the
parties in any way will settle the dispute. Each party will appoint one
arbitrator and the two will select a third. If the two arbitrators cannot agree
on the choice of a third within thirty (30) days following their appointment,
each arbitrator shall nominate three candidates within ten (10) days thereafter,
two of whom the other shall decline, and the decision shall be made by drawing
lots.
The Ceding Company and the Reinsurer shall bear the expense of its own
arbitrator and shall jointly bear with the other the expense of the third
arbitrator. In the absence of a decision to the contrary by the arbitration
panel, the Ceding Company and the Reinsurer shall jointly share in all other
costs of the arbitration.
The arbitration proceedings will be conducted according to the Commercial
Arbitration Rules of XXXXX-US, which are in effect at the time the arbitration
begins.
The arbitration will take place in Hartford, Connecticut unless the parties
mutually agree otherwise.
Within sixty (60) days after the beginning of the arbitration proceedings the
arbitrators will issue a written decision on the dispute and a statement of any
award to be paid as a result. The decision will be based on the terms and
conditions of this Agreement as well as the usual customs and practices of the
insurance and reinsurance industry, rather than on strict interpretation of the
law. The decision will be final and binding on both the Ceding Company and the
Reinsurer and there will be no further appeal.
The parties may mutually agree to extend any of the negotiation or arbitration
periods shown in this Article.
Unless otherwise decided by the arbitrators, the parties will share in their
proportion of all expenses resulting from the arbitration, including the fees
and expenses for the arbitrators, except that each party will be responsible for
its own attorneys' fees.
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ARTICLE XX
TERMINATION
A. The Ceding Company and the Reinsurer may terminate this Agreement as it
applies to the new business of each by giving 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 each party, will be the first day of the (90)
ninety-day period. In addition, this Agreement may be terminated immediately for
the acceptance of new reinsurance by either party if one of the parties becomes
insolvent as described in Article XVII.
B. During the (90) ninety-day period, this Agreement will continue to be in
force between the terminating parties.
C. After termination, the terminating parties shall remain liable under the
terms of this Agreement for all reinsurance that becomes effective prior to
termination of this Agreement. After termination, the Reinsurer shall be liable
for all reinsurance that has an application date and has been received and
accepted by the Reinsurer on or before the effective date of the termination.
ARTICLE XXI
GENERAL PROVISIONS
A. Entire Contract
This Agreement with any attached Schedules and Exhibits shall constitute the
entire contract between the parties with respect to the business being reinsured
hereunder and there are no understandings between the parties other than as
expressed herein.
B. Modifications
Any modification or change to the provisions of this Agreement shall be null and
void unless set forth in a written amendment to the Agreement which is signed by
all parties to the Agreement.
C. Severability
In the event that any provision or term of this Agreement shall be held by any
court, arbitrator, or administrative agency to be invalid, illegal or
unenforceable, all of the other terms and provisions shall remain in full force
and effect to the extent that their continuance is practicable and consistent
with the original intent of the parties. In addition, if any provision or term
is held invalid, illegal or unenforceable, the parties will attempt in good
faith to renegotiate the Agreement to carry out the original intent of the
parties.
D. Survival
All provisions of this Agreement shall survive its termination to the extent
necessary to carry out the purposes of this Agreement or to ascertain and
enforce the parties' rights or obligations hereunder existing at the time of
termination.
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E. Non-Waiver
No waiver by either party of any violation or default by the other party in the
performance of any promise, term or condition of this Agreement shall be
construed to be a waiver by such party of any other or subsequent default in
performance of the same or any other promise, term or condition of this
Agreement. No prior transactions or dealings between the parties shall be deemed
to establish any custom or usage waiving or modifying any provision hereof. The
failure of either party to enforce any part of this Agreement shall not
constitute a waiver by such party of its right to do so, nor shall it be deemed
to be an act of ratification or consent.
F. Governing Law
This Agreement shall be governed by the laws of the state of Connecticut.
G. Assignment
Neither party may assign any of its rights, duties or obligations under this
Agreement without the prior written consent of the other party.
H. Counterparts
This Agreement may be executed in one or more counterparts, each of which shall
constitute an original.
I. Force Majeure
Neither party shall be liable for any delay or non-performance of any covenant
contained herein nor shall any such delay or non-performance constitute a
default hereunder, or give rise to any liability for damages if such delay or
non-performance is caused by an event of "force majeure." As used herein, the
term "Force Majeure," means an event, explosion, action of the elements, strike
or other labor relations problem, restriction or restraint imposed by law, rule
or regulation of any public authority, whether federal, state or local, and
whether civil or military, act of any military authority, interruption of
transportation facilities or any other cause which is beyond the reasonable
control of such party and which by the exercise of reasonable diligence such
party is unable to prevent. The existence of any event of Force Majeure shall
extend the term of performance on the part of such party to complete performance
in the exercise of reasonable diligence after the event of Force Majeure has
been removed.
J. No Limitation on Disclosure of Tax Treatment
Notwithstanding anything herein to the contrary, except as reasonably necessary
to comply with applicable securities laws, each party to this Agreement (and
each employee, representative, or other agent of such party) may consult any tax
advisor regarding the U.S. federal income tax treatment or tax structure of the
transaction (the "Tax Transaction"), and disclose to any and all persons,
without limitation of any kind, the Tax Treatment and all materials of any kind
that are provided to such party relating to the Tax Treatment. The permission to
disclose the Tax Treatment is limited to any facts relevant to the U.S. federal
income Tax Treatment and does not include information relating to the identity
of the parties.
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K. Compliance
This Agreement applies only to the issuance of insurance by the Ceding Company
in a jurisdiction in which it is properly licensed.
The Ceding Company represents and warrants, to the best of its knowledge, that
it is in compliance with all of the state and federal laws applicable to the
business reinsured under this Agreement. In the event that the Ceding Company is
found to be in non-compliance with any law material to this Agreement, the
Agreement will remain in effect and the Ceding Company will indemnify the
Reinsurer for any direct loss the Reinsurer suffers as a result of the
non-compliance, and will seek to remedy the non-compliance.
ARTICLE XXII
CONFIDENTIALITY
As used herein, "Confidential Information" means all of our confidential,
proprietary, or trade secret information, including, but not limited to, all
information on the Ceding Company's customers and claimants and other
information the Ceding Company discloses to the Reinsurer. The term
"Confidential Information" does not include any information which (i) at the
time of disclosure or thereafter is generally available to and known by the
public other than by way of a wrongful disclosure by a party or its
Representatives; (ii) was available on a non-confidential basis from a source
other than the parties hereto or their Representatives, provided that such
source is not and was not bound by a confidentiality agreement with a party
hereto; or (iii) was independently developed without violating any obligations
under this Agreement and without the use of any Confidential Information.
The Reinsurer shall maintain the confidentiality of the Confidential
Information, shall use it only for purposes for which it was disclosed and shall
not disclose it to any other person except to employees, agents, and other
persons who need to know such Confidential Information (Retrocessionaires) to
carry out the purposes for which it was disclosed and who agree to maintain the
confidentiality of the information provided herein.
ARTICLE XXIII
NOTICES AND COMMUNICATIONS
All notices and communications under this treaty should be sent to:
Individual Life Director of Reinsurance
Hartford Life
000 Xxxxxxxxx Xx.
Xxxxxxxx, XX 00000
With copies to:
Chief Actuary
Hartford Life
000 Xxxxxxxxx Xx.
Xxxxxxxx, XX 00000
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General Counsel
Hartford Life
000 Xxxxxxxxx Xx.
Xxxxxxxx, XX 00000
Canada Life Reinsurance
000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxx X0X 0X0
Attn: Reinsurance Division
Notices are deemed received when delivered.
ARTICLE XXIV
EFFECTIVE DATE
The provisions of this Agreement shall be effective with respect to policies
issued on or after April 1, 2003.
ARTICLE XXV
EXECUTION
THE CANADA LIFE ASSURANCE COMPANY
By: /s/ Xxx X'Xxxxxxxx By: /s/ Xxxxxx Xxxxxx
------------------------------ ------------------------------
Title: Xxx X'Xxxxxxxx, FSA, FCIA Title: Xxxxxx Xxxxxx, FSA, FCIA, MAAA
Vice President & Actuary Senior Vice President
Life Reinsurance Life Reinsurance
Date: May 5, 2006 Date: May 5/06
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx Attest: /s/ Xxxxxxx X. Xxxxxx
------------------------------ ------------------------------
Xxxxxx X. Xxxxxxxx, FSA, XXXX Xxxxxxx X. Xxxxxx, FSA, MAAA
Assistant Vice President Vice President and Actuary
Individual Life Product
Management
Date: 3/17/06 Date: 3/17/06
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SCHEDULE A
PLANS COVERED UNDER THIS AGREEMENT
TYPE OF BUSINESS Individual life insurance issued by the Ceding Company
UPSCALE PRODUCTS RIDERS
-------------------------------------------------------------------------------------------------
Stag Protector Variable Universal Life Other Covered Insured
Stag Variable Life Accumulator Term Rider (base or other insured)
Stag Universal Life ADB Benefit (not reinsured)
SPVL (Fully underwritten only) Deduction Amount Waiver Rider
ART (CW), 5 & 10 Year Term (NY) Waiver of Monthly Deduction
One Year Term Waiver of Specified Amount
Stag Whole Life Enhanced No Lapse Guarantee Rider
Estate Tax Repeal Benefit Rider
Level Compensation Endorsement
Children's Life Insurance Rider
Maturity Date Extension
Guaranteed COI Benefit Rider
Mortality and Expense Risk Rates Rider
MIDDLE AMERICA PRODUCTS RIDERS
-------------------------------------------------------------------------------------------------
LBSI UL Term Rider (base or other insured)
Life Solutions I UL Waiver of Premium Riders
Life Solutions II UL Waiver of Monthly Deduction Riders
20 Year Term Additional Purchase Option Rider
Disability Income Rider (not reinsured)
WOODBURY PRODUCTS
-------------------------------------------------------------------------------------------------
Hartford Stag Wall Street Variable Universal Life Term Rider
ADB (not reinsured)
Waiver of Monthly Deduction
Waiver of Specified Amount
Cost of Living Adjustment Rider
Child Rider
Accelerated Benefit Rider
Specify Monthly Deductions
Enhanced No Lapse Guarantee
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SCHEDULE A
PLANS COVERED UNDER THIS AGREEMENT
DESCRIPTIONS
RIDERS WHERE ADDITIONAL PREMIUM IS DUE TO THE REINSURER:
Other Covered Insured: Provides term coverage for insured other than base
insured.
Term Rider (base or other insured): Provides additional term coverage
Deduction Amount Waiver Rider: Waives monthly deduction amount if insured is
disabled
Waiver of Monthly Deduction: Waives monthly deduction amount if insured is
disabled
Waiver of Specified Amount: Waives specified amount if insured is disabled
Children's Life Insurance Rider: Provides additional term coverage for a child
Waiver of Premium Riders: Waives premium requirement if insured is disabled
Additional Purchase Option Rider: Provides additional term coverage
Cost of Living Adjustment Rider: This rider is available at issue only for
nonsubstandard issue ages 0 to 60. The rider allows for face amount increases
without underwriting biannually based on the Consumer Price Index with the
maximum amount of this increase being $50,000.
RIDERS THAT ALTER THE POLICY AND IN WHICH NO ADDITIONAL PREMIUM IS PAID TO THE
REINSURER. IF A POLICY HAS THIS RIDER IT IS STILL COVERED UNDER THE AGREEMENT:
Enhanced No Lapse Guarantee Rider: This rider guarantees that the policy will
not lapse, regardless of investment performance, provided cumulative premiums
paid less indebtedness less withdrawals are greater than or equal to the
cumulative no lapse guarantee premiums. There is a life time option and a
limited term option. The limited term option is the lesser of 20 years or to
attained age 80 for issue ages 0 to 70 and the minimum of 10 years or to
attained age 90 for issue ages 71 to 85. Also, at the time when the no lapse
guarantee terminates or defaults, the policyholder may be eligible for an
additional amount of time they have this protection, which is based on the then
current account value.
Estate Tax Repeal Benefit Rider: This rider will pay the account value less
indebtedness if the Federal Estate Tax Law is fully repealed by December 31,
2010 and we receive a request for this benefit amount from the insured.
Level Compensation Endorsement: Surrender charges are not assessed for a full
surrender during the first three policy years. There is no charge for this
rider.
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SCHEDULE A
PLANS COVERED UNDER THIS AGREEMENT
Maturity Date Extension Rider: When the policyholder reaches the maturity date
and has elected this rider, the death benefit is dropped to the account value,
no more monthly deductions are taken, interest is credited, no further premiums
are accepted, policy loans continue to accrue interest, and all other riders are
terminated.
Guaranteed COI Benefit Rider: This rider provides guaranteed cost of insurance
rates for the first 10 policy years. On each policy anniversary, we declare a
cost of insurance rate for a single policy year. This policy year is the policy
year 9 years from the then current policy anniversary. Thus the rider provides
that on any policy anniversary, cost of insurance rates over the next 10 years
will not exceed those provided by the rider. This rider is currently available
in only a few states and on variable life policy forms where the face amount is
at least thirty million dollars.
Accelerated Benefit Rider: With this rider, the policyholder can receive up to
100% of their death benefit discounted with interest if the life expectancy is
12 months or less.
Specify Monthly Deductions : This rider allows the policyholder to specify to
take monthly deductions out of a particular account in the policy.
Mortality and Expense Risk Rider: This rider guarantees that the mortality and
expense risk rate will be zero for years greater than and equal to 21.
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SCHEDULE B
BASIS OF REINSURANCE
FACULTATIVE REINSURANCE
The Reinsurer will accept X% (as determined at issue) of the risk.
NET AMOUNT AT RISK DEFINITION: [Redacted]
MINIMUM INITIAL FACULTATIVE REINSURANCE SUBMISSION [Redacted]
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EXHIBIT I
REINSURANCE PREMIUM CALCULATION
1. REINSURANCE PREMIUM
ANNUAL YRT REINSURANCE PREMIUM [Redacted]
2. PREMIUM TAX
Premium tax will not be reimbursed.
3. FLAT EXTRA ALLOWANCES
The flat extra premium paid to the Reinsurer will be the annual flat extra rate
which the Ceding Company charges the insured less the allowances below times the
Reinsured Net Amount at Risk.
DURATION OF FLAT EXTRA FIRST YEAR RENEWAL YEARS
------------------------------------------------------------------
Less than 5 years [Redacted] [Redacted]
5 years or more
4. RIDERS
Term riders, cost of living riders, and other riders providing additional or
increasing coverage will use the same methods and YRT rates as the base plan.
Waiver of premium rates are attached and are per dollar of annualized amount.
Deduction amount waiver rates (also called "waiver of monthly deductions") are
attached, and the charge for this benefit is a rate times the monthly deduction
amount. Our retention on both types of waivers is proportional to our retention
on the death benefit. For both the Waiver of Premium and Waiver of Monthly
Deduction, the reinsurance premium will be net of the following allowances:
First Year Renewal Years
[Redacted] [Redacted]
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EXHIBIT II
SINGLE LIFE RETENTION AND JUMBO LIMITS
RETENTION LIMIT [Redacted]
JUMBO LIMIT [Redacted]
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EXHIBIT III
Annual per 1000 Yearly Renewable Term reinsurance rates are attached.
PRODUCTS USING MULTI-CLASS RATE TABLES: [Redacted]
Stag Protector Variable Universal Life
Stag Accumulator Variable Universal Life
Stag Universal Life
Stag Whole Life
Hartford Stag Wall Street Variable Universal Life
PRODUCTS USING UNI-CLASS RATE TABLES: [Redacted]
LBSI UL
Life Solutions I UL
Life Solutions II UL
20 Year Term
ART (CW)
5 & 10 Year Term (NY)
SPVL
One Year Term
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SINGLE LIFE 2002 MULTICLASS ANNUAL YRT PER 1000 REINSURANCE RATES
[Redacted]
1
Monthly Per 1000
Waiver of Monthly Deduction Amount
Age Male Female
[Redacted] [Redacted] [Redacted]
2/21/2006
1
EXHIBIT IV
SAMPLE ADMINISTRATIVE REPORTS
BILLING STATEMENT SAMPLE
POLICY DETAIL REPORT
For Each Policy show:
- Hartford Life Treaty Number
- Issue Date
- Name
- Sex
- Birth Date
- Issue Age
- Smoker/NonSmoker
- State of Residence
- Current Plan
- Face Amount
- Ceded Face Amount
- Ceded Net Amount at Risk
- Rating Table
- Net YRT Premium
- First Year/Renewal Indicator
- Bill Date
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EXHIBIT IV
SAMPLE ADMINISTRATIVE REPORTS
Quarterly Reinsurance Reserve Summary
Ceded to: [Redacted]
For Period of:
Hartford Life Treaty Number:
CURRENT NET AMOUNT AT RISK RESERVES
--------------------------------------------------------------------------
Basic [Redacted] [Redacted]
Substandard
Total
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EXHIBIT IV
SAMPLE ADMINISTRATIVE REPORTS
MONTHLY REINSURANCE POLICY EXHIBIT
CEDED TO:
For the period of:
Hartford Life Treaty Number:
Current Period:
NUMBER OF POLICIES CURRENT NET AMOUNT AT RISK
--------------------------------------------------------------------------
In force Beg of Period [Redacted] [Redacted]
Increases
New Business
Reinstatement
Other Increases
Decreases:
Not Takens
Lapses
Recaptures
Claims
Other Decreases
In force End of Period
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TERMINATION ADDENDUM
EFFECTIVE OCTOBER 31, 2005
TO THE
FACULTATIVE YEARLY RENEWABLE TERM
REINSURANCE AGREEMENT
EFFECTIVE APRIL 1, 2003
BETWEEN
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
("CEDING COMPANY")
AND
THE CANADA LIFE ASSURANCE COMPANY
("REINSURER")
WHEREAS, the Reinsurer currently reinsures the Ceding Company's plans or
policies under the above-referenced
reinsurance agreement ("Agreement"); and
WHEREAS, the Ceding Company and the Reinsurer have agreed to terminate the
Agreement for new business effective October 31, 2005.
NOW, THEREFORE, for good and valuable consideration, receipt of which is hereby
acknowledged, the Ceding Company and the Reinsurer hereby agree as follows:
1. Effective October 31, 2005, the Ceding Company will no longer cede, and the
Reinsurer will no longer accept, polices whose original application date was on
or after October 31, 2005. The Agreement will continue to apply to all in force
reinsurance until the termination or expiration of all such reinsurance.
2. Except as herein amended, all other terms and conditions of the Agreement
shall remain unchanged and in full force and effect.
Single Life Fac Only -- Effective 04/01/2003
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Termination Addendum - Effective 10/31/2005
1
In witness of the foregoing, the Ceding Company and the Reinsurer have, by their
respective officers, executed the termination addendum in duplicate on the dates
indicated below, with an effective date of October 31, 2005.
THE CANADA LIFE ASSURANCE COMPANY
By: /s/ Xxxxxx Xxxxxx By: /s/ Xxxx-Xxxxxxxx Xxxxxx
------------------------------- -------------------------------
Name: Xxxxxx Xxxxxx, FSA, FCIA, MAAA Name: Xxxx-Xxxxxxxx Xxxxxx, FSA, FCIA
Title: Senior Vice-President Title: Senior Vice President
Life Reinsurance Life Reinsurance
Date: August 18/11 Date: August 19, 2011
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
By: /s/ Xxxx Xxxxxxx Attest: /s/ Xxxxxxx Xxxxxx
------------------------------- -------------------------------
Name: Xxxx Xxxxxxx Name: Xxxxxxx Xxxxxx
Title: Assistant Vice President & Title: Senior Vice President & Actuary
Actuary
Date: August 30, 2011 Date: August 30, 2011
Single Life Fac Only -- Effective 04/01/2003
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Termination Addendum - Effective 10/31/2005
2
FACULTATIVE YEARLY RENEWABLE TERM
REINSURANCE AGREEMENT
between
HARTFORD LIFE INSURANCE COMPANY
and
THE CANADA LIFE ASSURANCE COMPANY
April 1, 2003
ARTICLES
I. Parties to the Agreement 3
II. Reinsurance Coverage 3
III. Liability 3
IV. Notification of Reinsurance 4
V. Reinsurance Premiums 4
VI. Reserves 6
VII. Oversights 7
VIII. Conversions 7
IX. Reductions, Terminations, and Changes 7
X. Increase in Retention 8
XI. Reinstatement 10
XII. Expenses 10
XIII. Claims 10
XIV. Extra-Contractual Damages 14
XV. Inspection of Records 14
XVI. DAC Tax - Section 1.848-2 (g)(8) Election 14
XVII. Insolvency 15
XVIII. Offset 16
XIX. Arbitration 16
XX. Termination 18
XXI. General Provisions 18
XXII. Confidentiality 20
XXIII. Notices and Communications 20
XXIV. Effective Date 21
XXV. Execution 21
SCHEDULES
A. Plans Covered under This Agreement 22
B. Basis of Reinsurance 25
EXHIBITS
I. Reinsurance Premium Calculation 26
II. Retention, Binding, and Issue Limits 27
III. Annual per 1000 YRT Reinsurance Rates 28
IV. Sample Administrative Reports 29
ALL SCHEDULES AND EXHIBITS ATTACHED WILL BE CONSIDERED PART OF THIS
REINSURANCE
AGREEMENT.
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ARTICLE I
PARTIES TO THE AGREEMENT
This Agreement is between Hartford Life Insurance Company (referred to as the
Ceding Company), and The Canada Life Assurance Company (referred to as the
Reinsurer).
The acceptance of risks under this Agreement will create no right or legal
relationship between the Reinsurer and the insured owner or beneficiary of any
insurance policy or contract of the Ceding Company. This Agreement will be
binding upon the Ceding Company and the Reinsurer and their respective
successors and assignees.
ARTICLE II
REINSURANCE COVERAGE
Reinsurance under this Agreement will apply to insurance issued by the Ceding
Company on the Plans of Insurance shown in Schedule A. Such Plans of Insurance
shall be reinsured with the Reinsurer on a facultative basis subject to the
requirements set forth in Section A below. The specifications for all
reinsurance under this Agreement are provided in Schedule B.
A. Requirements for Facultative Reinsurance
The Ceding Company will send copies of all of the papers or facsimiles relating
to the insurability of the individual risk to the Reinsurer. After the Reinsurer
has examined the request, the Reinsurer will promptly notify the Ceding Company
of the underwriting offer subject to additional requirements or the final
underwriting offer. The final underwriting offer on the individual risk will
automatically terminate upon the earlier of the withdrawal of the application or
120 days from the date of the final offer, unless coverage is accepted or put in
place earlier.
The individual risk must be underwritten according to the Ceding Company's
standard issue practices and guidelines.
B. Basis of Reinsurance
Reinsurance under this Agreement will be on the basis as stated in Schedule B.
C. Policy Forms
When requested, the Ceding Company will furnish the Reinsurer with a copy of
each policy, rider, rate book, and applicable sales or marketing material that
applies to the life insurance reinsured hereunder.
ARTICLE III
LIABILITY
A. The Reinsurer's liability will begin simultaneously with the Ceding
Company's liability once the Reinsurer has accepted the application and the
Ceding Company has accepted the offer.
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B. In no event shall the reinsurance be in force and binding if the issuance
and delivery of such insurance constituted the doing of business in a
jurisdiction in which the Ceding Company was not properly licensed.
C. The Reinsurer's liability for reinsurance on the individual risk will
terminate when the Ceding Company's liability terminates.
D. The Reinsurer shall establish reserves on the Reinsurer's portion of the
policy on the reserve basis specified in Article VI.
ARTICLE IV
NOTIFICATION OF REINSURANCE
A. The Ceding Company will notify the Reinsurer on the monthly statement as
described in Article V.
B. When reinsurance is reduced or changed, the Ceding Company will notify the
Reinsurer on the monthly accounting statement.
ARTICLE V
REINSURANCE PREMIUMS
A. Computation
Premiums for reinsurance under this Agreement will be computed as described in
Exhibit I.
B. Premium Accounting
1. Payment of Reinsurance Premiums
Following the close of each calendar month, the Ceding Company will
send the Reinsurer a statement and a listing of new business,
changes, and terminations, similar to Exhibit IV. The Reinsurer will
refund to the Ceding Company all unearned Annual YRT Reinsurance
Premiums not including policy fees, less applicable allowances,
arising from reductions, terminations and changes as described in
Article IX.
Annual YRT Reinsurance Premiums, as calculated in Exhibit I, based
on the Reinsured Net Amount at Risk, as defined in Schedule B, are
paid annual in advance each month for those new policies with an
effective date during the previous month and for those renewal
policies with a policy anniversary date during the current month. If
a net reinsurance premium balance is payable to the Reinsurer, the
Ceding Company will forward this balance within thirty (30) days
after the close of each month.
If a net reinsurance premium balance is payable to the Ceding
Company, the balance due will be subtracted from the reinsurance
premium payable by the
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Ceding Company for the current month. The Reinsurer shall pay any
remaining balance due the Ceding Company within forty-five (45) days
after the Ceding Company submits the statement.
If an overpayment is not returned to the Ceding Company promptly or
there is overdue premiums due to the Reinsurer, the party that is
due payment reserves the right to charge interest on reinsurance
payments due. The interest will be calculated according to the 90
Day Federal Government Treasury rate as first published in the Wall
Street Journal in the month following the end of the billing period
plus 50 basis points. The method of calculation will be simple
interest "Bankers' Rule" (or 360 day year).
2. Termination Because of Non-Payment of Premium
If undisputed reinsurance premiums are delinquent, the Reinsurer has
the right to terminate the reinsurance risks of those policies by
giving the Ceding Company ninety (90) days advance written notice.
If the delinquent premiums have not been paid as of the close of the
(90) ninety-day period, the Reinsurer's liability will terminate for
the risks described in the delinquency notice.
Regardless of the termination, the Ceding Company will continue to
be liable to the Reinsurer for all unpaid reinsurance premiums
earned up to the date of termination.
3. Reinstatement of a Delinquent Statement
The Ceding Company may reinstate the terminated risks within sixty
(60) days after the effective date of termination by paying the
unpaid reinsurance premiums for the risks in force prior to the
termination as defined in Article V -- B1 above. However, the
Reinsurer will not be liable for any claim incurred between the date
of termination and reinstatement. The effective date of
reinstatement will be the date the required back premiums are
received.
4. Currency
The reinsurance premiums and benefits payable under this Agreement
will be payable in the lawful money of the United States.
5. Detailed Listing
The Ceding Company will send the Reinsurer an electronic detailed
listing of all reinsurance in force, similar to Exhibit IV, thirty
(30) days after the end of each quarter.
6. Guaranteed Rates
The Reinsurer does not guarantee the rates in this treaty but
intends to charge these rates indefinitely. In the event that the
Reinsurer does increase rates, except as noted below, the Ceding
Company shall have the right to recapture the business as of the
date of notice of rate change. At this date of recapture, the
Reinsurer in addition to any other amounts due, shall transfer an
amount equal to
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If however, the Ceding Company raises the rates charged to their
customers, the Reinsurer shall have the right to raise rates without
the allowed recapture stated above. However, this increase to the
reinsurance rates shall be no more than proportional to the increase
to the policy owners' cost of insurance rates.
7. Overpayment of Premium
If the Ceding Company overpays a reinsurance premium and the
Reinsurer accepts the overpayment, the Reinsurer's acceptance will
not constitute nor create a reinsurance liability nor result in any
additional reinsurance. Instead, the Reinsurer will be liable to the
Ceding Company for a credit in the amount of the overpayment.
8. Underpayment of Premium
If the Ceding Company fails to make a full premium payment for a
policy or policies reinsured hereunder, due to an oversight defined
in Article VII, the amount of reinsurance coverage provided by the
Reinsurer shall not be reduced. However, once the underpayment is
discovered, the Ceding Company will be required to pay to the
Reinsurer the difference between the full premium amount and the
amount actually paid, without interest. If payment or the full
premium is not made within sixty (60) days after the discovery of
the underpayment, the underpayment shall be treated as a failure to
pay premiums and subject to the conditions of Section B.2, above.
ARTICLE VI
RESERVES
A. Statutory Reserves for the Mortality Risk of the Policy
[Redacted]
B. Representations
The Reinsurer represents to the Ceding Company that the Reinsurer is properly
licensed or accredited so that the Ceding Company may claim statutory reserve
credit in its financial statements filed in all states and the U.S. territories
of American Samoa, Guam, Puerto Rico and the U.S. Virgin Islands, in which the
Ceding Company is licensed to transact insurance business. In the event that as
a result of a change in the Reinsurer's licensing or accreditation status, due
to an action taken on behalf of the Reinsurer, the Ceding Company must obtain
security for statutory reserve credits taken with respect to
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this Agreement, the Reinsurer will take all actions necessary or appropriate to
ensure that the Ceding Company is able to claim such reserve credit on its
statutory statements, including but not limited to establishing a trust or
letter of credit in a form which meets all applicable standards of law and
regulation. The Reinsurer will bear the expense of establishing any trusts or
letters of credit with respect to this provision.
ARTICLE VII
OVERSIGHTS
If there is an unintentional oversight, misunderstanding, delay or error in the
administration of this Agreement by the Ceding Company or the Reinsurer, it can
be corrected provided the correction takes place within a reasonable time after
the oversight, misunderstanding, delay, or error is first discovered. Both the
Ceding Company and the Reinsurer will be restored to the position they would
have occupied had the oversight or misunderstanding not occurred. Should it not
be possible to restore both parties to such a position, the Ceding Company and
the Reinsurer shall negotiate in good faith to equitably apportion any resulting
liabilities and expenses.
This section shall not apply to applications for facultative reinsurance for
which the Reinsurer has not received written notification that its offer of
facultative reinsurance has been accepted by the Ceding Company in accordance
with Article III.
ARTICLE VIII
CONVERSIONS
Conversions from existing term plans of insurance reinsured under this Agreement
will be reinsured using the YRT premiums attached as Exhibit I on a point in
scale basis up to the original face amount. The converted policy will be
reinsured with the Reinsurer in the same proportion as was determined for the
original term policy. A term conversion is a contractual right of the
policyholder to replace a term policy with a permanent policy without evidence
of insurability.
ARTICLE IX
REDUCTIONS, TERMINATIONS AND CHANGES
A. Replacement or Change
If there is a contractual change, the insurance will continue to be reinsured
with the Reinsurer at point-in-scale rates. If an exchange is requested where
the death benefit is increased, the Reinsurer must consent to the change.
Exchanges from one single life plan reinsured under this Agreement to a
different single life plan will be reinsured at point-in-scale rates. An
exchange is a new policy replacing an existing policy where the new policy is
not fully underwritten.
B. Increases or Decreases
1. In the event of a reduction in the face amount of a policy, the
Reinsurer's
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percentage of the reduced face amount shall be the same percentage
as set at issue.
2. A request to increase the face amount of policies that are reinsured
will be submitted to the Reinsurer for acceptance.
C. Reduction in Retained Coverage
If any portion of the aggregate insurance retained by the Ceding Company on an
individual life reduces or terminates, the Ceding Company will recalculate its
retention on any remaining risk(s) inforce on that life with the intent of
holding the appropriate retention under each applicable
reinsurance agreement.
The retention limit, which was in effect at the time that each remaining risk
was issued, will be used. The Ceding Company will not be required to retain an
amount in excess of its regular retention limit for the age, mortality rating,
and risk classification at the time of issue for any policy. The Ceding Company
will first recalculate the retention on the policy(ies) having the same
mortality rating as the terminated policy(ies). Order of recalculation will
secondarily be determined by policy effective date, oldest first.
D. Multiple Reinsurers
If a risk is shared by more than one reinsurer, the Reinsurer's percentage of
any increased or reduced reinsurance will be the same as its initial percentage
of the reinsurance for that risk.
E. Termination
If the policy for a risk reinsured under this Agreement is terminated, the
reinsurance for the risk involved will be terminated on the effective date of
termination.
F. Mortality Rating
If the Ceding Company wishes to reduce the mortality rating, this reduction will
be subject to the Reinsurer's approval.
ARTICLE X
INCREASE IN RETENTION
A. If the Ceding Company should increase the retention limits as listed in
Exhibit II, prompt written notice of the increase must be given to the
Reinsurer.
B. In the event of an increase in retention, the Ceding Company will have the
option of recapturing the reinsurance up to the increased retention under this
Agreement. The Ceding Company may exercise its option to recapture by giving
written notice to the Reinsurer within (90) ninety days after the effective date
of the increase.
C. Whenever the Ceding Company increases its maximum retention limits over the
Ceding Company's Maximum Limits of Retention, as set forth in Exhibit II, the
Ceding Company has the option to recapture certain risk amounts. If the Ceding
Company has maintained
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its maximum stated retention (not a special retention limit) for the plan and
the insured's issue age, sex, and mortality classification in effect at the time
the reinsurance was ceded to the Reinsurer, or if the Ceding Company did not
retain insurance on the life, it may apply its increased retention limits to
reduce the amount of reinsurance as follows:
1. The reduction in reinsurance will become effective on the next
annual premium anniversary after the individual policy has been
inforce for at least twenty (20) years.
2. If more than one policy per life is eligible for recapture, then the
eligible policies may be recaptured beginning with the policy with
the earliest issue date and continuing in chronological order
according to the remaining policies' issue dates.
3. It is understood that the Ceding Company will not re-cede the
business once it has been recaptured for a period of at least three
(3) years unless the Reinsurer agrees to accept this business.
4. If any reinsured policy is recaptured, all reinsured policies
eligible for recapture under the provisions of this Article must be
recaptured up to the Ceding Company's new maximum retention limits
in a consistent manner and the Ceding Company must increase its
total amount of insurance on each reinsured life. The Ceding Company
may not revoke its election to recapture for policies becoming
eligible at future anniversaries.
5 If portions of the reinsured policy have been ceded to more than one
reinsurer, the Ceding Company must allocate the reduction in
reinsurance so that the amount reinsured by each reinsurer after the
reduction is proportionately the same as if the new maximum dollar
retention limits had been in effect at the time of issue.
6. The amount of reinsurance eligible for recapture is based on the
Total Net Amount at Risk (as defined in Schedule B) as of the date
of recapture. For a policy issued as a result of a conversion, the
recapture terms of the reinsurance agreement covering the original
policy will apply, and the duration period for the purpose of
recapture will be measured from the effective date of reinsurance on
the original policy.
7. The terms and conditions for the Ceding Company to recapture
reinsured policies, as a result of the insolvency of the Reinsurer,
are set forth in Article XVII.
8. Cessions Under Waiver of Premium Claim: If there is a reinsured
waiver of premium claim in effect when recapture takes place, the
Reinsurer will continue to pay its share of the waiver claim until
it terminates. The Reinsurer will not be liable for any other
benefits, including the basic life risk, that are eligible for
recapture. All such eligible benefits will be recaptured as if there
were no waiver claim in effect.
9. After the effective date of recapture, the Reinsurer will not be
liable for any reinsured policies or portions of such reinsured
policies eligible for recapture that the Ceding Company has
overlooked.
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ARTICLE XI
REINSTATEMENT
If an insurance policy lapses for nonpayment of premium and is reinstated under
the Ceding Company's terms and rules, the Reinsurer will reinstate the
reinsurance as follows:
A. Facultative Cases
Whenever an application is made by the policyholder for reinstatement in
accordance with the terms of the policy, the policy was originally reinsured
facultatively, and the reinstatement occurs ninety (90) days or more after the
policy has lapsed, copies of such application for reinstatement, any personal
declaration or medical examination and any other underwriting document shall be
forwarded by the Ceding Company to the Reinsurer together with an application
for reinstatement of the reinsurance. The Reinsurer shall notify the Ceding
Company within three (3) business days of its acceptance or declination of the
application for reinstatement.
Upon the Reinsurer's approval, the Ceding Company must pay the Reinsurer all
back reinsurance premiums in the same manner as the Ceding Company received
insurance charges or premiums under the policy. In the event that the policy is
redated, the reinsurance premiums payable shall be at the appropriate policy
year rate.
B. Nonforfeiture Reinsurance Termination
If the Ceding Company has been requested to reinstate a policy that was
reinsured while on extended term or reduced paid-up, then such reinsurance will
terminate and facultative reinstatement procedures will be followed as outlined
above in this Article.
ARTICLE XII
EXPENSES
The Ceding Company must pay the expense of all medical examinations, inspection
fees and other charges in connection with the issuance of the insurance.
ARTICLE XIII
CLAIMS
A. Liability
If the Ceding Company is liable for insurance benefits on a policy reinsured
under this Agreement, the Reinsurer shall be liable for its portion of the
reinsurance on that policy, as described in Schedule B. All reinsurance claim
settlements will be subject to the terms and conditions of the particular
contract and statutory requirements under which the Ceding Company is liable.
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B. Notification
The Ceding Company shall report promptly to the Reinsurer the following
information:
- Name of Insured
- Date of Birth of the Insured
- Date of Death (if this information is available at the time of this
initial notification)
- Company Code
- Policy Number
- Policy Date
- Face Amount
- Retention of the Ceding Company
- Amount Reinsured
- Treaty
Such claim made upon the Ceding Company shall be accepted by the Reinsurer as a
claim upon it for the amount of reinsurance in force on the date the claim is
incurred.
For claims incurred during the contestable period on risks ceded to the
Reinsurer on a facultative basis where the Ceding Company has the intent to
rescind, the Ceding Company shall submit all papers in connection with the claim
to the Reinsurer.
C. Claim Payment
1. Facultative Reinsurance on a Risk
If a claim is made on a risk reinsured facultatively under this
Agreement, the Ceding Company shall submit to the Reinsurer all
relevant and/or requested documents and papers related to the claim
along with the Ceding Company's recommendation. Upon receipt by the
Reinsurer, the Ceding Company shall then wait five (5) business days
during which time the Reinsurer shall have the opportunity to advise
the Ceding Company of its consent or disagreement with the
recommendation. In the event the Reinsurer does not contact the
Ceding Company within the (5) five-day period, the Reinsurer shall
be deemed to have approved the recommendation and the Ceding Company
shall be authorized to act accordingly.
The parties shall use best efforts to reach mutual agreement with
respect to the submitted claim before the Ceding Company responds to
the claimant.
2. Payment of Reinsurance Proceeds
The Reinsurer shall reimburse the Ceding Company for its
proportionate share of any interest paid on claims. The Reinsurer
will pay the Ceding Company the reinsurance proceeds within fifteen
(15) business days of final notification of the Ceding Company
making the final decision to pay the policy proceeds, unless the
claim amount is disputed.
If either by the terms of the contract or by the exercise of an
option, payment under the policy is deferred or made in
installments, the Reinsurer shall nevertheless make payment
immediately in one sum, upon receipt of proper notification stated
in (B) above.
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3. Recapture
If an undisputed net amount due to the Ceding Company is thirty (30)
days past due, the Ceding Company shall provide the Reinsurer
written notice, addressed to a senior officer of the Reinsurer, that
includes (1) an itemization of the unpaid claims, and (2) a reminder
that the Ceding Company will have the right to offset and
subsequently recapture all business reinsured if such claims remain
unpaid ninety (90) days past the due date. The sixty (60) day period
between the Reinsurer written notice and ninety (90) days past the
due date shall be called the "Cure Period".
If the Reinsurer is delinquent, ninety (90) days past due, on an
undisputed net amount due to the Ceding Company, the Ceding Company
will have the right to offset such amounts from any amounts due the
Reinsurer in accordance with Article XVIII. To the extent there is
an insufficient balance from which to offset such amounts and the
resulting amount due exceeds the Ceding Company shall have the right
to recapture immediately upon the termination of the Cure Period.
4. Overdue Reinsurance Proceeds
The Ceding Company reserves the right to charge interest on
reinsurance proceeds due. The interest will be calculated according
to the 90 Day Federal Government Treasury rate as first published in
the Wall Street Journal in the month following the end of the
billing period plus 50 basis points. The method of calculation will
be simple interest "Bankers' Rule" (or 360 day year).
5. Waiver of Premium
If Waiver of Premium is reinsured under this Agreement, then in the
event of a total disability claim, the Ceding Company shall continue
to pay the Reinsurer the reinsurance premium. However, the Ceding
Company will not pay the reinsurance premium for the waiver benefit
for the duration of the waiver claim period. The Reinsurer shall pay
the Ceding Company its share of the gross premium being waived,
including any rider or supplementary benefit gross premiums being
waived, taking into account any fractions of a year for which
premiums have been waived. The Reinsurer will pay waiver benefits
annually regardless of the mode of premium payment specified in the
policy.
6. Interest
If payment under the policy is delayed and interest is allowed per
statutory requirement or the contract, the Reinsurer will pay
interest on the reinsurance at the same rate and for the same time
period as the Ceding Company.
D. Contests, Denials, Litigation, Reduced Settlements and Compromises
The Ceding Company shall promptly notify the Reinsurer of any claim the Ceding
Company plans to contest, deny, litigate or compromise ("Contest"). The Ceding
Company shall also furnish details of such action on request and shall furnish
an itemized reinsurance claim form of expenses incurred thereby.
Once the Reinsurer receives all requested documents, the Reinsurer shall notify
the Ceding Company in writing of the Reinsurer's decision whether or not to
participate in the Contest. If the Reinsurer notifies the Ceding Company in
writing that it has elected not to participate in the Contest, the Reinsurer
shall immediately pay the Ceding
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Company its share of the claim and expenses and not share in any subsequent
increase or reduction. Once the Reinsurer has paid its share, it shall not be
liable for any additional expenses associated with the Contest.
When the Reinsurer agrees in writing to participate on a Contest, involving
reinsurance, it shall share in the payment of legal or investigative expenses
relating to the claim in the same proportion as the Reinsurer's liability bears
to the Ceding Company's liability. The Reinsurer shall not reimburse expenses
associated with non-reinsured policies. If the Ceding Company's Contest results
in a reduction or increase in the liability of the contested policy, the
Reinsurer shall share in the reduction or increase proportional to their share
of the Total Net Amount at Risk (as defined in Schedule B) on the date of death
of the insured.
E. Misstatement of Age or Sex
If the amount of insurance provided by the policy or policies reinsured under
this Agreement is increased or reduced because of misstatement of age or sex
established after the death of the insured, the Reinsurer will share with the
Ceding Company in this increase or reduction. The face amount of the reinsured
policy will be adjusted from the inception of the policy, and any difference
will be settled without interest.
F. Routine Expenses
The Ceding Company will pay the routine expenses incurred in connection with
settling claims. These expenses may include compensation of agents and employees
and the cost of routine investigations.
G. Non-Routine Expenses
The Reinsurer will share with the Ceding Company all expenses that are not
routine. Expenses that are not routine are those directly incurred in connection
with the contest or the possibility of a contest of a claim or the assertion of
defenses, including legal expenses. The expenses will be shared in proportion to
the Total Net Amount at Risk, as defined in Schedule B, for the Ceding Company
and the Reinsurer. However, if the Reinsurer has released the liability under
Section D of this Article, the Reinsurer will not share in any expenses incurred
after the date of the Reinsurer's release.
H. Return of Premium for Misrepresentations and Suicides
If a misrepresentation on an application or a death of an insured risk by
suicide results in the Ceding Company returning the policy premiums to the
policy owner rather than paying the policy benefits, the Reinsurer will refund
all of the reinsurance premiums it received on that policy to the Ceding Company
without interest. This refund given by the Reinsurer will be in lieu of all
other reinsurance benefits payable on that policy under this Agreement.
I. Contestable Period
If during the contestable period, Ceding Company is notified of the death of the
insured, the Ceding Company will investigate the case.
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ARTICLE XIV
EXTRA-CONTRACTUAL DAMAGES
In no event will the Reinsurer have any liability for any extra-contractual
damages, which are awarded against the Ceding Company as a result of acts,
omissions, or course of conduct committed solely by the Ceding Company with no
involvement of the Reinsurer in connection with the insurance reinsured under
this Agreement.
The Reinsurer will, however, pay its share of punitive and/or compensatory
damages and/or statutory penalties awarded against the Ceding Company in
connection with benefits reinsured under this Agreement if the Reinsurer agreed
in writing to the act or course of conduct of the Ceding Company that resulted
in the assessment of such damages.
The Reinsurer does recognize that circumstances may arise under which the
Reinsurer, in equity, should share, to the extent permitted by law, in paying
certain assessed damages. Such circumstances are difficult to define in advance,
but by example may involve those situations in which the Reinsurer was an active
party and, in writing, recommended, consented to or explicitly ratified the act,
omission, or course of conduct of the Ceding Company that ultimately resulted in
the assessment of such damages. The extent of such sharing is dependent on good
faith assessment of culpability in each case, but all factors being equal, the
division of any such assessment would be in the proportion of Total Net Amount
at Risk (as defined in Schedule B) accepted by each party for the plan of
insurance involved.
ARTICLE XV
INSPECTION OF RECORDS
Each party or their authorized representatives will have the right, at any
reasonable time and upon reasonable notice, to inspect the other party's books
and documents that relate to reinsurance under this Agreement.
ARTICLE XVI
DAC TAX
SECTION 1.848-2(G) (8) ELECTION
A. The Ceding Company and the Reinsurer jointly agree to the DAC Tax Election
pursuant to Section 1.848-2(g)(8) of the Income Tax Regulations (the "Treasury
Regulations") issued under Section 848 of the Internal Revenue Code of 1986, as
amended (the "Code") whereby:
(i) The party with the net positive consideration for this Agreement for
each taxable year will capitalize specified policy acquisition
expenses with respect to this Agreement without regard to the
general deductions limitation of Code section 848(c)(1); and
(ii) Both parties agree to exchange information pertaining to the amount
of net consideration under this Agreement each year to ensure
consistency.
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B. As used in this Article XVI, the terms "net positive consideration",
"specified policy acquisition expenses" and "general deductions limitation" are
defined by reference to Treasury Regulations Section 1.848-2 and Code Section
848 as of April 1, 2003.
C. The method and timing of the exchange of this information shall be as
follows:
(i) The Ceding Company shall submit a schedule to the Reinsurer by May 1
of each year of its calculation of the net consideration for the
preceding calendar year.
(ii) The Reinsurer shall, in turn, complete the schedule by indicating
acceptance of the Ceding Company's calculation of net consideration
or shall note in writing any discrepancies. The Reinsurer shall
return the completed schedule to the Ceding Company by June 1 of
each year.
(iii) If there are any discrepancies between the Ceding Company's and the
Reinsurer's calculation of net consideration, the parties shall act
in good faith to resolve these discrepancies in a manner that is
acceptable to both parties by July 1 of each year.
(iv) Each party shall attach the final schedule to their respective U.S.
federal income tax returns for each taxable year in which
consideration is transferred under this Agreement. The schedule
shall identify this Agreement and restate the election described in
this Article XVI and shall be signed by both parties.
D. This DAC Tax Election shall be effective on the effective date of this
Agreement and shall be effective for all years for which this Agreement remains
in effect.
E. The Ceding Company and the Reinsurer each represent and warrant that they
are subject to U.S. taxation under either the provisions of Subchapter L of
Chapter 1 or Subpart F of Part III of Subchapter N of Chapter 1 of the Code.
F. Should the Reinsurer breach the representation and warranty of tax status
set forth in this Article of this Agreement, the Reinsurer agrees to indemnify
and hold the Ceding Company, its directors, officers, employees, agents, and
shareholders harmless from any liability and all liability, loss, damages,
fines, penalties, interest, and reasonable attorney's fees, which the Ceding
Company, its directors, officers, employees, agents, and shareholders may
sustain by reason of such breach.
ARTICLE XVII
INSOLVENCY
A. Insolvency of the Reinsurer
If the Reinsurer becomes insolvent as determined by the Regulatory Agency
responsible for such determination, amounts due the Reinsurer will be paid net
of the terms of this Agreement and directly to the liquidator, receiver, or
statutory successor without decrease. In addition, upon the Reinsurer's
insolvency, the Ceding Company may cancel this Agreement for future new business
as described in Article XX. All reinsurance ceded under this Agreement may be
recaptured by the Ceding Company as of the date the Reinsurer fails to meet its
obligations under this Agreement.
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B. Insolvency of the Ceding Company
If the Ceding Company should become insolvent, as determined by the Regulatory
Agency responsible for such determination, all reinsurance under this Agreement
will be payable by the Reinsurer directly to the Ceding Company's liquidator,
receiver or statutory successor, on the basis of the liability of the Ceding
Company under the policy or policies reinsured and without diminution because of
the insolvency of the Ceding Company. However, in the event of such insolvency,
the liquidator, receiver, or statutory successor will give written notice of a
pending claim against the Ceding Company on the reinsured policy. It will do so
within a reasonable time after the claim is filed in the insolvency proceedings.
During the pendency of such a claim, the Reinsurer may investigate the claim and
may, at its own expense, interpose any defense or defenses, which it may deem
available to the insolvent Ceding Company, its liquidator, receiver, or
statutory successor, in the proceedings where the claim is to be adjudicated.
The expense thus incurred by the Reinsurer will be chargeable against the
insolvent Ceding Company, subject to court approval, as part of the expense of
liquidation to the extent of a proportionate share of the benefit, which may
accrue to the insolvent Ceding Company solely as a result of the defense
undertaken by the Reinsurer.
Where two or more reinsurers are involved in the same claim and a majority in
interest elect to interpose defense to the claim, the expense will be
apportioned in accord with the terms of the reinsurance agreement as though the
expense had been incurred by the insolvent Company.
ARTICLE XVIII
OFFSET
Any undisputed debts or credits, matured or unmatured, liquidated or
unliquidated, regardless of when they arose or were incurred, in favor of or
against either the Ceding Company or the Reinsurer with respect to this
Agreement, shall be offset, and only the balance shall be allowed or paid. In
the event the Ceding Company becomes insolvent, offsets shall be allowed in
accordance with applicable law.
ARTICLE XIX
ARBITRATION
The Ceding Company and the Reinsurer mutually understand and agree that the
wording and interpretation of this Agreement is based on the usual customs and
practice of the insurance and reinsurance industry. While both the Ceding
Company and the Reinsurer agree to act in good faith in its dealings with each
other, it is understood and recognized that situations may arise in which they
cannot reach an agreement.
In the event that any dispute cannot be resolved to mutual satisfaction, the
dispute will first be subject to good-faith negotiation as described below in an
attempt to resolve the dispute without the need to institute formal arbitration
proceedings.
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Within ten (10) days after one of the parties has given the other the first
written notification of the specific dispute, each of the parties will appoint a
designated officer to attempt to resolve the dispute. The officers will meet at
a mutually agreeable location as early as possible and as often as necessary, in
order to gather and furnish the other with all appropriate and relevant
information concerning the dispute. The officers will discuss the problem and
will negotiate in good faith without the necessity of any formal arbitration
proceedings. During the negotiation process, all reasonable requests made by one
officer to the other for information will be honored. The designated officers
will decide the specific format for such discussions.
If the officers cannot resolve the dispute within thirty (30) days of their
first meeting, both parties agree that they will submit the dispute to formal
arbitration. However, the parties may agree in writing to extend the negotiation
period for an additional thirty (30) days.
No later than fifteen (15) days after the final negotiation meeting, the
officers taking part in the negotiation will give both the Ceding Company and
the Reinsurer written confirmation that they are unable to resolve the dispute
and that they recommend establishment of formal arbitration.
An arbitration panel consisting of three (3) past or present officers of life
insurance or life reinsurance companies not affiliated with either of the
parties in any way will settle the dispute. Each party will appoint one
arbitrator and the two will select a third. If the two arbitrators cannot agree
on the choice of a third within thirty (30) days following their appointment,
each arbitrator shall nominate three candidates within ten (10) days thereafter,
two of whom the other shall decline, and the decision shall be made by drawing
lots.
The Ceding Company and the Reinsurer shall bear the expense of its own
arbitrator and shall jointly bear with the other the expense of the third
arbitrator. In the absence of a decision to the contrary by the arbitration
panel, the Ceding Company and the Reinsurer shall jointly share in all other
costs of the arbitration.
The arbitration proceedings will be conducted according to the Commercial
Arbitration Rules of XXXXX-US, which are in effect at the time the arbitration
begins.
The arbitration will take place in Hartford,
Connecticut unless the parties
mutually agree otherwise.
Within sixty (60) days after the beginning of the arbitration proceedings the
arbitrators will issue a written decision on the dispute and a statement of any
award to be paid as a result. The decision will be based on the terms and
conditions of this Agreement as well as the usual customs and practices of the
insurance and reinsurance industry, rather than on strict interpretation of the
law. The decision will be final and binding on both the Ceding Company and the
Reinsurer and there will be no further appeal.
The parties may mutually agree to extend any of the negotiation or arbitration
periods shown in this Article.
Unless otherwise decided by the arbitrators, the parties will share in their
proportion of all expenses resulting from the arbitration, including the fees
and expenses for the arbitrators, except that each party will be responsible for
its own attorneys' fees.
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ARTICLE XX
TERMINATION
A. The Ceding Company and the Reinsurer may terminate this Agreement as it
applies to the new business of each by giving 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 each party, will be the first day of the (90)
ninety-day period. In addition, this Agreement may be terminated immediately for
the acceptance of new reinsurance by either party if one of the parties becomes
insolvent as described in Article XVII.
B. During the (90) ninety-day period, this Agreement will continue to be in
force between the terminating parties.
C. After termination, the terminating parties shall remain liable under the
terms of this Agreement for all reinsurance that becomes effective prior to
termination of this Agreement. After termination, the Reinsurer shall be liable
for all reinsurance that has an application date and has been received and
accepted by the Reinsurer on or before the effective date of the termination.
ARTICLE XXI
GENERAL PROVISIONS
A. Entire Contract
This Agreement with any attached Schedules and Exhibits shall constitute the
entire contract between the parties with respect to the business being reinsured
hereunder and there are no understandings between the parties other than as
expressed herein.
B. Modifications
Any modification or change to the provisions of this Agreement shall be null and
void unless set forth in a written amendment to the Agreement which is signed by
all parties to the Agreement.
C. Severability
In the event that any provision or term of this Agreement shall be held by any
court, arbitrator, or administrative agency to be invalid, illegal or
unenforceable, all of the other terms and provisions shall remain in full force
and effect to the extent that their continuance is practicable and consistent
with the original intent of the parties. In addition, if any provision or term
is held invalid, illegal or unenforceable, the parties will attempt in good
faith to renegotiate the Agreement to carry out the original intent of the
parties.
D. Survival
All provisions of this Agreement shall survive its termination to the extent
necessary to carry out the purposes of this Agreement or to ascertain and
enforce the parties' rights or obligations hereunder existing at the time of
termination.
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E. Non-Waiver
No waiver by either party of any violation or default by the other party in the
performance of any promise, term or condition of this Agreement shall be
construed to be a waiver by such party of any other or subsequent default in
performance of the same or any other promise, term or condition of this
Agreement. No prior transactions or dealings between the parties shall be deemed
to establish any custom or usage waiving or modifying any provision hereof. The
failure of either party to enforce any part of this Agreement shall not
constitute a waiver by such party of its right to do so, nor shall it be deemed
to be an act of ratification or consent.
F. Governing Law
This Agreement shall be governed by the laws of the state of
Connecticut.
G. Assignment
Neither party may assign any of its rights, duties or obligations under this
Agreement without the prior written consent of the other party.
H. Counterparts
This Agreement may be executed in one or more counterparts, each of which shall
constitute an original.
I. Force Majeure
Neither party shall be liable for any delay or non-performance of any covenant
contained herein nor shall any such delay or non-performance constitute a
default hereunder, or give rise to any liability for damages if such delay or
non-performance is caused by an event of "force majeure." As used herein, the
term "Force Majeure," means an event, explosion, action of the elements, strike
or other labor relations problem, restriction or restraint imposed by law, rule
or regulation of any public authority, whether federal, state or local, and
whether civil or military, act of any military authority, interruption of
transportation facilities or any other cause which is beyond the reasonable
control of such party and which by the exercise of reasonable diligence such
party is unable to prevent. The existence of any event of Force Majeure shall
extend the term of performance on the part of such party to complete performance
in the exercise of reasonable diligence after the event of Force Majeure has
been removed.
J. No Limitation on Disclosure of Tax Treatment
Notwithstanding anything herein to the contrary, except as reasonably necessary
to comply with applicable securities laws, each party to this Agreement (and
each employee, representative, or other agent of such party) may consult any tax
advisor regarding the U.S. federal income tax treatment or tax structure of the
transaction (the "Tax Transaction"), and disclose to any and all persons,
without limitation of any kind, the Tax Treatment and all materials of any kind
that are provided to such party relating to the Tax Treatment. The permission to
disclose the Tax Treatment is limited to any facts relevant to the U.S. federal
income Tax Treatment and does not include information relating to the identity
of the parties.
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K. Compliance
This Agreement applies only to the issuance of insurance by the Ceding Company
in a jurisdiction in which it is properly licensed.
The Ceding Company represents and warrants, to the best of its knowledge, that
it is in compliance with all of the state and federal laws applicable to the
business reinsured under this Agreement. In the event that the Ceding Company is
found to be in non-compliance with any law material to this Agreement, the
Agreement will remain in effect and the Ceding Company will indemnify the
Reinsurer for any direct loss the Reinsurer suffers as a result of the
non-compliance, and will seek to remedy the non-compliance.
ARTICLE XXII
CONFIDENTIALITY
As used herein, "Confidential Information" means all of our confidential,
proprietary, or trade secret information, including, but not limited to, all
information on the Ceding Company's customers and claimants and other
information the Ceding Company discloses to the Reinsurer. The term
"Confidential Information" does not include any information which (i) at the
time of disclosure or thereafter is generally available to and known by the
public other than by way of a wrongful disclosure by a party or its
Representatives; (ii) was available on a non-confidential basis from a source
other than the parties hereto or their Representatives, provided that such
source is not and was not bound by a confidentiality agreement with a party
hereto; or (iii) was independently developed without violating any obligations
under this Agreement and without the use of any Confidential Information.
The Reinsurer shall maintain the confidentiality of the Confidential
Information, shall use it only for purposes for which it was disclosed and shall
not disclose it to any other person except to employees, agents, and other
persons who need to know such Confidential Information (Retrocessionaires) to
carry out the purposes for which it was disclosed and who agree to maintain the
confidentiality of the information provided herein.
ARTICLE XXIII
NOTICES AND COMMUNICATIONS
All notices and communications under this treaty should be sent to:
Individual Life Director of Reinsurance
Hartford Life
000 Xxxxxxxxx Xx.
Xxxxxxxx, XX 00000
With copies to:
Chief Actuary
Hartford Life
000 Xxxxxxxxx Xx.
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Simsbury, CT 06089
20
General Counsel
Hartford Life
000 Xxxxxxxxx Xx.
Xxxxxxxx, XX 00000
Canada Life Reinsurance
000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxx X0X 0X0
Attn: Reinsurance Division
Notices are deemed received when delivered.
ARTICLE XXIV
EFFECTIVE DATE
The provisions of this Agreement shall be effective with respect to policies
issued on or after April 1, 2003.
ARTICLE XXV
EXECUTION
THE CANADA LIFE ASSURANCE COMPANY
By: /s/ Xxx X'Xxxxxxxx By: /s/ Xxxxxx Xxxxxx
------------------------------ ------------------------------
Xxx X'Xxxxxxxx, FSA, FCIA Xxxxxx Xxxxxx, FSA, FCIA, MAAA
Title: Vice President & Actuary Life Title: Senior Vice President Life
Reinsurance Reinsurance
Date: May 5, 2006 Date: May 5/06
HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx Attest: /s/ Xxxxxxx X. Xxxxxx
------------------------------ ------------------------------
Xxxxxx X. Xxxxxxxx, FSA, XXXX Xxxxxxx X. Xxxxxx, FSA, MAAA
Assistant Vice President Vice President and Actuary
Individual Life Product
Management
Date: 3/17/06 Date: 3/17/06
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SCHEDULE A
PLANS COVERED UNDER THIS AGREEMENT
TYPE OF BUSINESS Individual life insurance issued by the Ceding Company
UPSCALE PRODUCTS RIDERS
--------------------------------------------------------------------------------
Stag Protector Variable Universal Life Other Covered Insured
Stag Variable Life Accumulator Term Rider (base or other insured)
Stag Universal Life ADB Benefit (not reinsured)
SPVL (Fully underwritten only) Deduction Amount Waiver Rider
ART (CW), 5 & 10 Year Term (NY) Waiver of Monthly Deduction
One Year Term Waiver of Specified Amount
Stag Whole Life Enhanced No Lapse Guarantee Rider
Estate Tax Repeal Benefit Rider
Level Compensation Endorsement
Children's Life Insurance Rider
Maturity Date Extension
Guaranteed COI Benefit Rider
Mortality and Expense Risk Rates Rider
MIDDLE AMERICA PRODUCTS RIDERS
--------------------------------------------------------------------------------
LBSI UL Term Rider (base or other insured)
Life Solutions I UL Waiver of Premium Riders
Life Solutions II UL Waiver of Monthly Deduction Riders
20 Year Term Additional Purchase Option Rider
Disability Income Rider (not
reinsured)
WOODBURY PRODUCTS
--------------------------------------------------------------------------------
Hartford Stag Wall Street Variable Term Rider
Universal Life
ADB (not reinsured)
Waiver of Monthly Deduction
Waiver of Specified Amount
Cost of Living Adjustment Rider
Child Rider
Accelerated Benefit Rider
Specify Monthly Deductions
Enhanced No Lapse Guarantee
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SCHEDULE A
PLANS COVERED UNDER THIS AGREEMENT
DESCRIPTIONS
RIDERS WHERE ADDITIONAL PREMIUM IS DUE TO THE REINSURER:
Other Covered Insured: Provides term coverage for insured other than base
insured.
Term Rider (base or other insured): Provides additional term coverage
Deduction Amount Waiver Rider: Waives monthly deduction amount if insured is
disabled
Waiver of Monthly Deduction: Waives monthly deduction amount if insured is
disabled
Waiver of Specified Amount: Waives specified amount if insured is disabled
Children's Life Insurance Rider: Provides additional term coverage for a child
Waiver of Premium Riders: Waives premium requirement if insured is disabled
Additional Purchase Option Rider: Provides additional term coverage
Cost of Living Adjustment Rider: This rider is available at issue only for
nonsubstandard issue ages 0 to 60. The rider allows for face amount increases
without underwriting biannually based on the Consumer Price Index with the
maximum amount of this increase being $50,000.
RIDERS THAT ALTER THE POLICY AND IN WHICH NO ADDITIONAL PREMIUM IS PAID TO THE
REINSURER. IF A POLICY HAS THIS RIDER IT IS STILL COVERED UNDER THE AGREEMENT:
Enhanced No Lapse Guarantee Rider: This rider guarantees that the policy will
not lapse, regardless of investment performance, provided cumulative premiums
paid less indebtedness less withdrawals are greater than or equal to the
cumulative no lapse guarantee premiums. There is a life time option and a
limited term option. The limited term option is the lesser of 20 years or to
attained age 80 for issue ages 0 to 70 and the minimum of 10 years or to
attained age 90 for issue ages 71 to 85. Also, at the time when the no lapse
guarantee terminates or defaults, the policyholder may be eligible for an
additional amount of time they have this protection, which is based on the then
current account value.
Estate Tax Repeal Benefit Rider: This rider will pay the account value less
indebtedness if the Federal Estate Tax Law is fully repealed by December 31,
2010 and we receive a request for this benefit amount from the insured.
Level Compensation Endorsement: Surrender charges are not assessed for a full
surrender during the first three policy years. There is no charge for this
rider.
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SCHEDULE A
PLANS COVERED UNDER THIS AGREEMENT
Maturity Date Extension Rider: When the policyholder reaches the maturity date
and has elected this rider, the death benefit is dropped to the account value,
no more monthly deductions are taken, interest is credited, no further premiums
are accepted, policy loans continue to accrue interest, and all other riders are
terminated.
Guaranteed COI Benefit Rider: This rider provides guaranteed cost of insurance
rates for the first 10 policy years. On each policy anniversary, we declare a
cost of insurance rate for a single policy year. This policy year is the policy
year 9 years from the then current policy anniversary. Thus the rider provides
that on any policy anniversary, cost of insurance rates over the next 10 years
will not exceed those provided by the rider. This rider is currently available
in only a few states and on variable life policy forms where the face amount is
at least thirty million dollars.
Accelerated Benefit Rider: With this rider, the policyholder can receive up to
100% of their death benefit discounted with interest if the life expectancy is
12 months or less.
Specify Monthly Deductions : This rider allows the policyholder to specify to
take monthly deductions out of a particular account in the policy.
Mortality and Expense Risk Rider: This rider guarantees that the mortality and
expense risk rate will be zero for years greater than and equal to 21.
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SCHEDULE B
BASIS OF REINSURANCE
FACULTATIVE REINSURANCE
The Reinsurer will accept X% (as determined at issue) of the risk.
NET AMOUNT AT RISK DEFINITION: [Redacted]
MINIMUM INITIAL FACULTATIVE REINSURANCE SUBMISSION
[Redacted]
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EXHIBIT I
REINSURANCE PREMIUM CALCULATION
1. REINSURANCE PREMIUM
ANNUAL YRT REINSURANCE PREMIUM
[Redacted]
2. PREMIUM TAX
Premium tax will not be reimbursed.
3. FLAT EXTRA ALLOWANCES
The flat extra premium paid to the Reinsurer will be the annual flat extra rate
which the Ceding Company charges the insured less the allowances below times the
Reinsured Net Amount at Risk.
DURATION OF FLAT EXTRA FIRST YEAR RENEWAL YEARS
--------------------------------------------------------------------------------
Less than 5 years [Redacted] [Redacted]
5 years or more
4. RIDERS
Term riders, cost of living riders, and other riders providing additional or
increasing coverage will use the same methods and YRT rates as the base plan.
Waiver of premium rates are attached and are per dollar of annualized amount.
Deduction amount waiver rates (also called "waiver of monthly deductions") are
attached, and the charge for this benefit is a rate times the monthly deduction
amount. Our retention on both types of waivers is proportional to our retention
on the death benefit. For both the Waiver of Premium and Waiver of Monthly
Deduction, the reinsurance premium will be net of the following allowances:
First Year Renewal Years
[Redacted] [Redacted]
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EXHIBIT II
SINGLE LIFE RETENTION AND JUMBO LIMITS
RETENTION LIMIT
[Redacted]
JUMBO LIMIT
[Redacted]
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EXHIBIT III
Annual per 1000 Yearly Renewable Term reinsurance rates are attached.
PRODUCTS USING MULTI-CLASS RATE TABLES: [Redacted]
Stag Protector Variable Universal Life
Stag Accumulator Variable Universal Life
Stag Universal Life
Stag Whole Life
Hartford Stag Wall Street Variable Universal Life
PRODUCTS USING UNI-CLASS RATE TABLES: [Redacted]
LBSI UL
LIFE SOLUTIONS I UL
LIFE SOLUTIONS II UL
20 YEAR TERM
ART (CW)
5 & 10 YEAR TERM (NY)
SPVL
ONE YEAR TERM
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Single Life 2002 Multiclass Annual YRT Per 1000 Reinsurance Rates
[Redacted]
1
Monthly Per 1000
Waiver of Monthly Deduction Amount
Age Male Female
[Redacted] [Redacted] [Redacted]
1
EXHIBIT IV
SAMPLE ADMINISTRATIVE REPORTS
BILLING STATEMENT SAMPLE
POLICY DETAIL REPORT
For Each Policy show:
- Hartford Life Treaty Number
- Issue Date
- Name
- Sex
- Birth Date
- Issue Age
- Smoker/NonSmoker
- State of Residence
- Current Plan
- Face Amount
- Ceded Face Amount
- Ceded Net Amount at Risk
- Rating Table
- Net YRT Premium
- First Year/Renewal Indicator
- Bill Date
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EXHIBIT IV
SAMPLE ADMINISTRATIVE REPORTS
Quarterly Reinsurance Reserve Summary
Ceded to:
For Period of:
Hartford Life Treaty Number:
CURRENT NET AMOUNT AT RISK RESERVES
----------------------------------------------------------------------------------------------------------------------------
Basic [Redacted] [Redacted]
Substandard
Total
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EXHIBIT IV
SAMPLE ADMINISTRATIVE REPORTS
MONTHLY REINSURANCE POLICY EXHIBIT
CEDED TO:
For the period of:
Hartford Life Treaty Number:
Current Period:
NUMBER OF POLICIES CURRENT NET AMOUNT AT RISK
----------------------------------------------------------------------------------------------------------------------------
In force Beg of Period [Redacted] [Redacted]
Increases
New Business
Reinstatement
Other Increases
Decreases:
Not Takens
Lapses
Recaptures
Claims
Other Decreases
In force End of Period
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TERMINATION ADDENDUM
EFFECTIVE OCTOBER 31, 2005
TO THE
FACULTATIVE YEARLY RENEWABLE TERM REINSURANCE AGREEMENT
EFFECTIVE APRIL 1, 2003
BETWEEN
HARTFORD LIFE INSURANCE COMPANY
("CEDING COMPANY")
AND
THE CANADA LIFE ASSURANCE COMPANY
("REINSURER")
WHEREAS, the Reinsurer currently reinsures the Ceding Company's plans or
policies under the above-referenced reinsurance agreement ("Agreement"); and
WHEREAS, the Ceding Company and the Reinsurer have agreed to terminate the
Agreement for new business effective October 31, 2005.
NOW, THEREFORE, for good and valuable consideration, receipt of which is hereby
acknowledged, the Ceding Company and the Reinsurer hereby agree as follows:
1. Effective October 31, 2005, the Ceding Company will no longer cede,
and the Reinsurer will no longer accept, polices whose original
application date was on or after October 31, 2005. The Agreement
will continue to apply to all in force reinsurance until the
termination or expiration of all such reinsurance.
2. Except as herein amended, all other terms and conditions of the
Agreement shall remain unchanged and in full force and effect.
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Termination Addendum- Effective 10/31/2005
1
In witness of the foregoing, the Ceding Company and the Reinsurer have, by their
respective officers, executed the termination addendum in duplicate on the dates
indicated below, with an effective date of October 31, 2005.
THE CANADA LIFE ASSURANCE COMPANY
By: /s/ Xxxxxx Xxxxxx By: /s/ Xxxx-Xxxxxxxx Xxxxxx
------------------------------ ------------------------------
Name: Xxxxxx Xxxxxx, FSA, FCIA, MAAA Name: Xxxx-Xxxxxxxx Xxxxxx, FSA,
FCIA
Title: Senior Vice-President Life Title: Senior Vice President Life
Reinsurance Reinsurance
Date: August 18/11 Date: August 19, 2011
HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxx Xxxxxxx Attest: /s/ Xxxxxxx Xxxxxx
------------------------------ ------------------------------
Name: Xxxx Xxxxxxx Name: Xxxxxxx Xxxxxx
Title: Assistant Vice President & Title: Senior Vice President &
Actuary Actuary
Date: August 30, 2011 Date: August 30, 2011
Single Life Fac Only -- Effective 04/01/2003
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Termination Addendum- Effective 10/31/2005
2
