EXHIBIT 10.23
MANAGING GENERAL AGENCY AGREEMENT
Agreement made as of Sept. 4, 2001 between:
AMERICAN VEHICLE INSURANCE COMPANY (the "Company"), an insurance
company organized under the laws of Florida and
ASSURANCE MANAGING GENERAL AGENTS, INC. (the "General Agent"), a
Florida corporation.
WHEREAS, the Company is a property and casualty company authorized to
issue private passenger automobile insurance policies in the State of Florida
(the "Policies"); and
WHEREAS, the Company wishes to engage the General Agent to provide
statistical reports, underwrite, market, administer and manage the Policies; and
WHEREAS, the General Agent desires to market, underwrite, administer
and manage the Policies on behalf of the Company under the direction and
supervision of the Company.
NOW, THEREFORE, it is agreed as follows:
ARTICLE I - TERM AND AUTHORIZATION
1.1 Term. The term of this Agreement shall commence as of the date of this
Agreement (the "Effective Date") and shall continue in full force and
effect until terminated (as elsewhere provided in this Agreement).
1.2 Authorization. The Company grants General Agent the following
authority:
1.2.1 To solicit and process applications for new and renewal
Policies solely in the State of Florida for the coverages and
maximum limits of liability set forth on Schedule A.
1.2.2 To issue insurance binders for Policies.
1.2.3 To rate quote and issue Policies based on underwriting
guidelines, rates and insurance contracts approved by the
Company and, to the extent required, properly approved and
filed with the Florida Department of Insurance (the
"Department").
1.2.4 To make customary endorsement, changes, transfers, and
modifications of existing Policies.
1.2.5 To solicit Policies through duly licensed insurance agents and
brokers.
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1.2.6 To collect and account for premiums and endorse checks payable
to the Company, if such checks are received by the General
Agent in the regular course of its duties to collect premium
monies on the Company's behalf.
1.2.7 To provide proper and timely cancellation or non-renewal
notice to policy holders, certificate holders and regulatory
bodies as required by the policy, any statute or regulation,
any regulatory order or by the Company.
ARTICLE II - REPRESENTATIONS
2.1 Company's Representations. The Company hereby represents and warrants
to the General Agent that the Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of
Florida and has all requisite corporate power and authority and all
required Florida insurance licenses to enter into this Agreement.
2.2 General Agent's Representations. The General Agent hereby represents
and warrants to the Company that the General Agent is a corporation
duly organized, validly existing, and in good standing under the laws
of the State of Florida, and has all requisite corporate power and
authority and all required Florida insurance licenses to enter into
this Agreement.
ARTICLE III - LIMITATIONS ON GENERAL AGENT'S AUTHORITY
3.1 The General Agent shall not hold itself out as an agent of the Company
in any other manner or for any other purpose than is specifically
prescribed in this Agreement.
3.2 The General Agent shall not institute, prosecute, defend or maintain
any legal proceedings in which the Company is named as a party without
the Company's prior written consent.
3.3 The General Agent shall not incur an indebtedness on behalf of the
Company.
3.4 The General Agent shall not appoint agents or sub-agents on behalf of
the Company; however, the General Agent may register duly licensed
insurance agents with the State of Florida.
3.5 The General Agent shall have no authority to adjust or settle claims on
behalf of the Company.
3.6 The General Agent shall have no authority to negotiate, cede, or accept
reinsurance on behalf of the Company.
3.7 The General Agent has no authority to directly or indirectly solicit,
sell, offer, bind, issue or deliver any insurance at any reduction or
deviation from the rates, terms or conditions specified by the Company.
The General Agent will adhere strictly to the rates and forms
promulgated and filed by the Company.
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3.8 The General Agent, without prior approval of the insurer, shall not pay
or commit the insurer to pay a claim over a specified amount, net of
reinsurance, which exceeds 1 percent of the insurer's policyholders
surplus as of December 31 of the last completed calendar year.
3.9 The General Agent shall not collect any payment from a reinsurer or
commit the insurer to any claims settlement with a reinsurer without
prior approval of the insurer.
ARTICLE IV - GENERAL AGENT'S OBLIGATIONS
4.1 Policy and Claim Services. General Agent shall, at General Agent's
expense, provide Policy administration services as provided in Schedule
B and shall pay claims approved by the Company or its designated
representative as provided in Schedule D. General Agent will promptly
report to the Company all Claims or suits arising under the Policies
written or bound under this Agreement and all claims or suits against
the Company relating to any matter to which the provisions of this
Agreement apply. Further, the General Agent will cooperate fully in the
investigation and adjustment of all claims and suits and will provide
the Company or its designees with all requested information relevant to
this adjustment or defense of such claims or suits, including copies of
any Policies or other documentation, immediately upon demand.
4.2 Licenses. The General Agent shall possess on the Effective Date and
maintain all licenses required to perform its obligations under this
Agreement.
4.3 Statistical Information. The General Agent agrees to provide the
Company with all pertinent statistical information as requested by the
Company in the form required by the Company.
4.3.1 All reports due the Company under this Article (whether in
hard copy or maintained on computers) shall be forwarded to
the Company within seven (7) days after the end of each month.
The electronic data files maintained by General Agent shall be
transferred to the Company as frequently as reasonably
requested.
4.3.2 The General Agent shall provide the Company with all requested
information, reports and statistical data reasonably requested
by the Company in a printed format that is acceptable to the
Company. The Company will limit its request to the following:
1) Reports that may be supplied by SIS in its standard
reporting format,
2) Reports utilized for the purpose of rate making
statistics and/or accounting reports:
The General Agent will also be responsible to generate and
furnish the following reports:
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a) Any motor vehicle or residential /
commercial information including insured
information required by the State of Florida
in order to satisfy any current or future
legal statute or regulation which includes
delivery to the proper governmental agency
in acceptable format.
b) Any required statistical information for the
purpose of reporting to NISS. The General
Agent will furnish statistical reports in
the NISS report format. All required reports
shall be furnished by the General Agent
accurately and promptly to allow the Company
to prepare pertinent reports required by
NAIC or NISS.
4.4 Premiums.
4.4.1 The General Agent agrees to pay the Company all premiums on
business produced by the General Agent on behalf of the
Company, whether or not collected by the General Agent from
insureds. All premiums received by the General Agent pursuant
to this Agreement will be held by the General Agent in a
fiduciary capacity as trustee for the Company. The General
Agent does not possess the funds collected for any other
reason. The privilege of taking commissions from premium
monies received by the General Agent will not be construed as
an alteration of this fiduciary capacity.
4.4.2 Premium Account. The General Agent in a fiduciary capacity
shall make a daily deposit of all premiums received, net of
producing sub-agents commission, into a bank that is a member
of the Federal Reserve System. The account is controlled and
owned by the Company and titled "Premium Trust Account". Any
premium or other receipt, shall be deposited on the same day
it is received unless, due to reasons beyond the General
Agents control such as late or delayed mail, same day deposit
is not practical in which event such premium will be deposited
on the next business day.
4.4.3 The General Agent shall reconcile cash deposited to the
Premium Trust Account with the report on a weekly basis.
4.4.4 The General Agent shall withdraw from separate account called
the "Premium Operating Account" on a weekly basis, an amount
sufficient to pay the General Agent Commission, return premium
due policyholders, sub-agents and/or premium finance
companies, and managing general agent's fee. The Premium
Operating Account will be maintained at the same bank as the
Premium Trust Account. The General Agent shall only make
withdrawals based on Company wire transferred funds which are
supported by the report and on Policies which have been
recorded and the premiums deposited. Any return premium or
commission due the Company shall be deposited in the Premium
Trust Account.
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4.4.5 The Company's acceptance of any deposit of funds to the
Premium Trust Account, or any transfer of funds to or from the
Operating Account, shall not constitute the Company's
acceptance of the accuracy of any report submitted by the
General Agent to the Company.
4.4.6 The General Agent will issue and submit to the Company all
Policies, endorsements and cancellations within thirty (30)
days of the effective date of the Policy, endorsement or
cancellation, respectively.
4.4.7 The General Agent will submit to the Company a detailed and
itemized monthly Account Current of all premiums written and
premium adjustments made (whether additional or return) with
respect to all business and transactions effective in that
month not later than the fifteenth (15th) day of the
subsequent month. For example, binders, policies, monthly
reports and endorsements effective in December are to be
reported no later than January 15. The Company, however, will
have the privilege, exercisable at its option, of preparing
the Account Current.
4.4.8 The General Agent agrees to provide the Company with all
pertinent statistical information as requested by the Company
in the form required by the Company.
4.4.9 The General Agent will be responsible for conducting a quality
assurance program for all premium, accounting and statistical
reports and all Policy transactions to assure compliance with
all terms of this Agreement and reconciliation procedures.
4.4.10 If the General Agent is delinquent in either accounting for or
paying monies due to the Company, then Company may, suspend or
modify any of the provisions of this Agreement or terminate
this Agreement if the delinquency is not corrected within ten
(10) business days of Company providing written notice to the
General Agent of existing delinquency.
4.5 Books, Accounts and Records.
4.5.1 The General Agent will keep complete and accurate records of
the business transacted by it under this Agreement, including,
but not limited to, all Policy and premium records created by
it during the term of this Agreement. Such records will be
retained by the General Agent while this Agreement is in
effect and for seven (7) years after termination of this
Agreement. In addition, the General Agent will forward to the
Company such reports of said business as the Company may
prescribe. The General Agent will be responsible for retaining
all Policy and premium records on behalf of the Company in
hard copy form, microfilm and/or other generally accepted
information storage medium, as well as in any reasonable
back-up form requested by the Company for the period described
above. The Company will have the right to examine said books,
files and records at any time during normal business hours at
the Company's expense, and to make such records as it may deem
necessary. All books, accounts or other documents relating to
the business of the Company, except computer software systems,
are the property of the Company whether paid for by it or not.
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The books and accounts of the Company will be accepted as full
and final evidence in all matters relating to this Agreement.
4.5.2 The Company may examine all books and records of the General
Agent pertaining to business written under this Agreement at
any time during normal business hours at the Company's expense
on the premises of the General Agent. Further, the Company may
make copies of all books and records described herein.
4.5.3 If this Agreement terminates, the General Agent will forward
to the Company all supplies and Policy files pertaining to the
terminated Underwriting Program and will return all unused
policy forms with an accounting of all such Policies provided
to the General Agent.
4.5.4 The provisions of this Section 4.5 which are binding upon the
parties subsequent to the termination of this Agreement, will
survive such termination until all obligations are finally
discharged.
4.6 Agents' Commissions. The General Agent shall accept business on behalf
of the Company only from duly licensed insurance brokers and agents.
The General Agent shall pay commissions due such brokers and agents.
The General Agent shall not pay less than 13% commission on automobile
policies without written approval from Company. The General Agent shall
be liable to the Company for any return commission due from such
brokers and agents, whether or not such return commission has been
collected by the General Agent.
4.7 Coverage Confirmation. The General Agent shall allow the Company to
confirm coverage for each reported claim by supplying the Company (or
its duly authorized claim adjusters) a copy of the Policy, declarations
page, and all applicable endorsements.
ARTICLE V - GENERAL AGENT'S COMPENSATION AND EXPENSES
5.1 Compensation. The General Agent will be responsible for all expenses
incurred by it in the performance of its obligation under this
Agreement including, but not limited to, rentals, transportation
facilities, remuneration of clerks, solicitors or other employees,
postage office upkeep, promotional and advertising expenses, traveling
expenses, and city license fees. The conduct by the General Agent of
its business will be its own sole cost, credit, risk and expense.
5.1.1 The General Agent will be responsible for all expenses in
connection with solicitation of insurance or performance of
any duties or obligations of the General Agent including, but
not limited to, all countersignature fees and commissions, and
all commissions to sub-producers. The General Agent will not
charge or commit the Company to any expense, agreement,
payment, debt or obligation other than the insurance expressly
described in the Addenda hereto which the General Agent is
authorized to write. The Company will supply the General Agent
with policy jackets, bank checks and drafts.
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5.2 Expenses. Subject to the terms and conditions of this Agreement, the
General Agent's sole remuneration for all services that the General
Agent may perform for the Company under this Agreement will be its
commissions at the rates set forth in Addenda to this Agreement. Unless
otherwise agreed, such commissions will include the complete
compensation to the General Agent for its service under this Agreement.
Under no circumstances will the General Agent receive commissions for
premiums which the General Agent has failed to collect and which the
Company has collected. For such premiums as are collected by the
Company, the General Agent will receive credit for the premium in the
parties' mutual account. In the event of Policy cancellation or an
endorsement resulting in a premium return to a policyholder, the
General Agent will be responsible for refunding to Company the entire
amount of any commission paid or allowed on the returned premium,
including commissions to sub-producers.
ARTICLE VI - INDEMNIFICATION
6.1 The General Agent agrees to indemnify and save the Company, its
affiliates and subsidiaries and their officers, directors, and
employees harmless from any damage and against any liability for loss,
cost, expenses, fines, penalties, including punitive or exemplary
damages and all cost of defense: (1) resulting from any act, error or
omission, whether intentional or unintentional, by the General Agent
and its officers, directors, and employees, related to or arising out
of the business covered by this Agreement; or (2) resulting from any
obligation, act or transaction created or performed by the General
Agent in violation of, in excess of, or in contravention of the power
and authority of the General Agent set forth in this Agreement.
6.1.1 The Company will choose defense counsel for all claims or
suits described in Article VI and defend itself. The General
Agent will pay all expense for such claims or suits. The
Company will decide, in its sole opinion, whether such claims
or suits may be settled.
6.1.2 The General Agent expressly authorizes the Company without
precluding the Company from exercising any other remedy it may
have, to charge against all compensation due or to become due
to the General Agent under this Agreement any monies paid or
liabilities incurred by the Company by reason of any
occurrence described herein.
6.1.3 Provided the General Agent is in compliance with all terms and
conditions of this Agreement and further provided General
Agent will not have caused or contributed to the making of a
claim on one or more policy(ies) of insurance which General
Agent has issued and/or bound, then the Company will indemnify
and hold harmless the General Agent, its directors, officers
and employees for any damage and against any liability of
loss, cost, expenses, fines, penalties including punitive or
exemplary damages and all cost of defense, arising from a
claim on said insurance policy(ies) which assert the liability
of the General Agent for all or part of the loss to claimant,
insured or any other party involved in the claim on the
policy(ies).
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6.1.4 The Company will choose defense counsel for all claims or
suits described in Section 6.1.3 and defend itself. The
Company will pay all cost of defense for such claims or suits
and decide, in its sole opinion, whether such claims or suits
may be settled.
ARTICLE VII - TERMINATION
7.1 Termination. This Agreement may be terminated as provide below:
7.1.1 Without cause by either party upon no less than seventy-five (75) days
prior written notice to the other party.
a) The insurer may suspend the underwriting authority of the
Managing General Agent during the pendency of any dispute
regarding the cause for termination. The insurer or Managing
General Agent must fulfill any obligations on policies,
regardless of any dispute
7.1.2 Upon the occurrence of an Event of Default (as defined below),
the non-defaulting party may cancel and terminate this
Agreement upon five (5) business days notice to the other
party.
7.1.3 The following shall be Events of Default by either party:
a) Default in the observance or performance of any material
covenant or obligation to be performed under this Agreement
and the failure to cure such default within ten (10) business
days after notice of such default bas been given to the
defaulting party; provided, however, that if the default is of
such a nature that it cannot reasonably be cured within such
ten (10) day period, the defaulting party will nevertheless be
deemed in default unless within such period it commences to
cure the default and thereafter diligently and continuously
continues to and does cure same within a reasonable period of
time thereafter.
b) Cessation of either party's business as a going concern.
c) Insolvency of either party, or the filing by it, or its
consent to the filing, of a petition under the Bankruptcy
Code, or the appointment of a receiver, assignee or other
liquidating officer for all or substantially all of such
party's assets.
d) The filing of an involuntary petition against either party
under the Bankruptcy Code which remains undismissed for thirty
(30) days or more following its filing.
e) If any public authority cancels or declines to renew any
license required by either party under this Agreement.
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f) If either party commits any fraudulent act or act of gross
negligence or willful misconduct.
g) A transfer, sale, or pledge of the majority of the stock or a
substantial portion of the assets of the General Agent unless
this Agreement is assigned by the Company's express written
consent.
h) If at any time the incurred loss ratio combined with the
incurred allocated loss adjusted expense ratio reaches greater
than 90% as determined by acceptable actuarial methodology.
7.2 Rights and Obligations after Termination.
7.2.1 If this Agreement is properly terminated as a result of the
occurrence of an Event of Default, and the expiration of any
grace period hereunder, the non-defaulting party shall be
entitled to all rights and remedies available at law or in
equity; provided, however, that neither party shall have a
claim against the other for consequential damages, such as
loss of prospective profit or damage to the business resulting
therefrom.
7.2.2 Upon termination of this Agreement for any reason the Company
shall have the option, with respect to all Policies and claims
then being serviced by General Agent, on notice to General
Agent, to (i) require General Agent to promptly turn over to
the Company all Policy records so that the Company may itself,
or cause others to, run off existing business, or (ii) require
that General Agent run off existing business by continuing to
provide Policy administration in accordance with this
Agreement.
7.2.3 If the Company elects the option set forth under subparagraph
7.2.2 (i) above, General Agent shall promptly deliver the
documents mentioned therein to the Company at General Agent's
sole expense and thereafter General Agent shall have no
further responsibility for Policy administration hereunder and
shall not be compensated for any such discontinued services.
7.2.4 If the Company elects the option set forth under subparagraph
7.2.2 (ii) above, and for so long as the Company so elects,
General Agent shall continue to perform its obligations under
this Agreement in accordance with the terms hereof. The
General Agent shall be obligated to perform the duties
necessary to the servicing of all Policies in force until all
liability of the Company underlying such Policies issued
pursuant to this Agreement shall have expired or been
terminated. Such service shall consist of, but shall not
necessarily be limited to, Policy cancellations, amendatory
endorsements, payment of return premiums, collection of
additional premiums and claims information.
7.2.5 Upon termination of this Agreement, provided that the General
Agent has performed all of its obligations required to be
performed hereunder, the General Agent's records and documents
and the right to renew the in-force business shall remain the
property of the General Agent and shall be left in the General
Agent's possession. In the event this Agreement is terminated
by the Company under Section 7.1.3(a) through (g), or in the
event the General Agent fails to perform all of its
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obligations under this Agreement, then in such event the right
to renew the in-force Policies shall belong to the Company.
ARTICLE VII - ARBITRATION
8.1 The Company and the General Agent hereby mutually agree that one of the
remedies for resolving any and all disputes arising with respect to or
in connection with this Agreement, including any disputes regarding the
cancellation or rescission of this Agreement, shall be arbitration as
herein provided.
8.2 All issues for arbitration shall be referred to disinterested
arbitrators, one being chosen by each party to the particular dispute.
The arbitrators so selected shall select an umpire within thirty (30)
days after appointment. In the event the arbitrators so not agree as to
the umpire within thirty (30) days, the umpire shall be chosen by the
American Arbitration Association. Should any party fail to chose its
arbitrator within thirty (30) days after receipt of written notice from
the party requesting arbitration, the arbitrator for such party shall
be chosen by the American Arbitration Association.
8.3 To the extent that they consider substantive rules of law, the
arbitrators should look to the substantive rules of law of the State of
Florida s the law governing this Agreement; however, the arbitrators
shall consider this Agreement and honorable engagement rather than
merely a legal obligation, and they are relieved of all judicial
formalities and may abstain from following the strict rules of law. The
decision and award of the majority of the arbitrators shall be final
and binding upon the parties to the particular dispute, and all other
parties as well. Judgement may be entered upon the award of arbitrators
in any Court of the United States having jurisdiction thereover.
8.4 The arbitrators shall be active or retired officers of insurance
companies not under the control or management of any party to this
Agreement. Arbitration shall take place in Tallahassee, Florida, unless
the parties in dispute agree otherwise. The United States Federal
Arbitration Act applies to this Agreement.
8.5 Each party shall bear the expense of its own chosen arbitrator, and
shall jointly and equally bear with the others the expense of the
umpire and of the arbitration.
ARTICLE IX - MISCELLANEOUS
9.1 Any notice or other communication required or permitted to be given
under this Agreement shall be in writing and shall be deemed duly given
(i) when received if delivered personally, by any recognized courier
service, or (ii) three (3) days after mailing, if sent by registered or
certified mail, return receipt requested, in each case addresses to the
party for whom it is intended at the following address or such other
address as the party may designate from time to time by notice given
pursuant hereto.
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For the Company:
American Vehicle Insurance Company
0000 X.X. 0 Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxxxx
For the General Agent:
Assurance Managing General Agents, Inc.
0000 X.X. 0 Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
9.2 This Agreement shall be constructed in accordance with the laws of the
State of Florida without giving effect to conflict of law principles.
9.3 Nothing herein shall create the relationship of employer and employee,
partners or joint ventures between the Company and the General Agent,
it being understood and agreed that the General Agent is an independent
contractor for the purposes set forth herein with all rights, powers
and duties as such.
9.4 The General Agent shall not assign this Agreement or any right
hereunder.
9.5 The failure of the Company or General Agent to insist on strict
compliance with this Agreement, or to exercise any right or remedy
hereunder, shall not constitute a waiver of any rights contained herein
or stop the parties from thereafter demanding full and complete
compliance therewith, nor prevent the parties from exercising any right
or remedy in the future.
9.6 If any provisions of this Agreement should be found to be invalid or
unenforceable, the remaining provisions of this Agreement shall remain
in full force and effect.
9.7 This Agreement may not be changed, nor may any provision hereof be
waived, except by a writing signed by both parties hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized officers as of the day and year first above written.
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AMERICAN VEHICLE INSURANCE COMPANY
By: /s/ Xxxxxxx X. Xxxxxxxxxx
---------------------------------------------------
ASSURANCE MANAGING GENERAL AGENTS, INC.
By: /s/ Xxxxxxx Xxxxxx
----------------------------------------------------
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SCHEDULE A
(COVERAGES AND MAXIMUM LIMITS OF LIABILITY)
AUTOMOBILE LIABILITY & PHYSICAL DAMAGE
Coverage Limits of Liability
-------- -------------------
Liability $100 / 300 / 50
Uninsured Motorists $100 / 300
Personal Injury $10,000
Medical Payments $500
Physical Damage $50,000
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SCHEDULE B
POLICY ADMINISTRATION SERVICES
1. Assist the Company in developing Underwriting and Producer Guidelines
and modifications thereto for the underwriting program, to be approved
by the Company in writing prior to use, which use will include
advertising, program implementation and binding insurance coverage.
2. Process applications for insurance.
3. Collect and account for premiums and endorse checks payable to the
Company, if such checks are received by the General Agent in the
regular course of its duties to collect premium monies on the Company's
behalf.
4. Rate, quote and issue policies of insurance and certificates of
insurance consistent with the Company's rate, rule and form filings
made or adopted in writing by the Company, and the authority granted
herein, as well as to provide policy information services for insureds.
5. Develop and maintain proper underwriting files on behalf of the Company
in accordance with Section 4.5.
6. Use best efforts and good faith to achieve an underwriting profit on
all business placed with the Company.
7. Provide proper and timely cancellation or non-renewal notice to
policyholders, certificate holders and regulatory bodies as required by
the policy, any statute or regulation, any regulatory order or by the
Company.
8. Remit premiums received net of the compensation due to the General
Agent, in accordance with the provisions of Section 4.4, entitled
"Premiums".
9. Adhere to Florida laws, regulations and bulletins pertaining to motor
vehicle and casualty insurance contracts including but not limited to:
o Policy cancellation or non renewal 627.728
o Rate increase 627.7282
o Unearned premiums 627.7283
o Motor vehicle inspection 627.744 and 4.167.004
o Premium finance cancellation
10. Comply with conduct guidelines according to regulation 4.142.011.
11. Maintain compliant handling procedures to record all complaints
received since date of last examination.
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SCHEDULE C
GENERAL AGENT'S COMPENSATION
The Company will allow the General Agent as compensation a fee equal to fifteen
(15%) percent of Net Written Premium for automobile (i.e. gross premiums
written, less cancellations and return premiums) with General Agent retaining a
twenty-five ($25) dollar fee per policy.
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SCHEDULE D
DRAFT AUTHORITY AND ISSUANCE
1. Enter data into the claims management system of General Agent.
2. Pay all qualified claims and allocated loss adjustment expenses timely
out of funds provided by the Company after the Company's claims
representative has prepared the draft requests.
3. Draw upon a bank account (the "Loss Payment Account") which shall be
established by the Company for payment of claims. Such authority may be
revoked at any time by the Company upon written notice. The Loss
Payment Account will be initially set at ______ and will be replenished
monthly by the Company to an amount equal to two (2) months estimated
paid. The Company may review the adequacy of the account at any time
and increase or decrease the account as necessary. The General Agent
shall be required upon the request of the Company, to remit promptly
any funds in the account in excess of the required amount as determined
by the Company.
4. Use only those persons to whom the Company specifically grants
authority in writing to issue a check upon the Loss Payment Account.
Such authority may be revoked upon written notice to the appropriate
parties. The Company shall designate two (2) of General Agent's
employees as authorized signatories on such account.
5. Account for all checks as on hand, issued, voided or canceled, and
provide a monthly account to the Company within fifteen (15) days after
the end of the month for which the account is given. General Agent
shall have the responsibility for balancing the Loss Payment Account. A
duplicate copy of all bank statements shall be sent to the Company by
General Agent. Copies of checks issued shall be available upon request
by the Company.
6. Provide monthly loss run reports to Company, by hard copy on paper and
in an acceptable data format, detailing by report period, year to date
and inception to date figures the following information by accident
date: Policy number, claim number, state location number, total
incurred expense, broken down by line of coverage, by cause of loss, by
contract year, allocated loss adjustment expense, outstanding reserves
and subrogation.
7. Furnish to Company monthly documentation identifying all loss payments
and allocated loss expenses.
8. Furnish loss reports within seven (7) days after the end of the month
for which they relate.
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