EXHIBIT 10.33
EQUIFAX
June 24, 1996
INFORMATION PRODUCTS AGREE
between
EQUIFAX SERVICES INC.
and
INTEGON CORPORATION
THIS INFORMATION PRODUCTS AGREEMENT ("Agreement") is made and entered into by
and between Equifax Services Inc., ("Equifax"), with an address for the purposes
of this Agreement at 0000 Xxxxxxxxx Xxxxxx, X.X. Xxxxxxx, Xxxxxxx 00000, and
Integon Corporation, ("Customer"), with an address for the purposes of this
Agreement at 000 Xxxx Xxxxx Xxxxxx, Xxxxxxx-Xxxxx, Xxxxx Xxxxxxxx 00000.
WITNESSETH:
WHEREAS, Customer is in the business of underwriting property and casualty
insurance policies; and,
WHEREAS, in order for Customer to underwrite such policies Customer requires the
use of certain information relative to individual's previous insurance claims
information and motor operators data; and,
WHEREAS, Equifax has compiled databases of such claims information, motor
operators data and obtains motor operator data from the state Department of
Motor Vehicles, and is willing to provide them to Customer for the fees set
forth herein;
NOW THEREFOR, in consideration for the mutual convenants contained herein, the
parties do hereby agree as follows:
1. PRODUCT DESCRIPTIONS:
Equifax will furnish Customer with the following named, and individually
described information products, systems, and services. Certain Products and
Services offered by Equifax under this Agreement may be governed by the terms
and conditions of other collateral agreements.
A . COMPREHENSIVE LOSS UNDERWRITING EXCHANGE (C.L.U.E.):
1. C.L.U.E. Auto-Equifax will provide Customer with automobile claims history
information from its C.L.U.E. personal automobile claims repository in a manner
described in Section II herein. These claims contain information such as dollar
amounts of losses by claim type, age of loss, carrier, policyholder, driver and
vehicle identification information. C.L.U.E. information is based on claims
information which has been provided to Equifax by insurance carriers.
EQUIFAX
B. Motor Vehicle Records (MVRs):
1. Equifax will order and return MVRs from certain states to Customer, as
requested by Customer. Equifax will analyze all MVR orders to ensure that they
conform to the input requirements of the various state Motor Vechicle
Department's ("MVD") Systems. Each MVR order will fall into one of three
categories:
(a) MVR orders which do not conform to the requirements of a
specific states' MVD system are considered rejected and are
subject to a surcharge fee. Surcharge is the fee Equifax
charges to process the MVR order.
(b) MVR orders meeting input requirements, but which are not found
by the state MVD are considered No-Hits ("No-Hits"). Customer
will receive MVRs that are "No-Hits" as "No-Hits" are subject
to registry charges in certain states and surcharge fees for
all states. Registry is the fee imposed by the state MVD to
obtain a motor vehicle report.
The states which currently do not impose a registry charge on
"No-Hits" are: Alaska, Iowa, Mississippi, North Carolina,
South Carolina, Utah, and Washington.
Equifax will apply a credit on Customer's invoice for the
number of "No-Hits" for each state which does not impose a
registry charge.
(c) MVR orders meeting input requirements, and for which an MVR is
obtained, are considered Hits ("Hits") and are subject to both
registry and surcharge fees.
2. Standard Violation code ("SVC"): MVR abstracts will contain Equifax's SVC if
Customer elects this feature. Customer Specific Codes ("CSCs") can be provided
if desired by Customer, but must be based on a correlation to the SVC.
3. Driver History Database: Where the state allows, Equifax saves MVR
information as it flows through our systems. We store the driver information in
a database and provide customer access to it at a cost less than the state
registry.
II. SYSTEM DESCRIPTIONS:
A. Ordering System:
A communication session will be established with Customer's central data center
at a predetermined, mutually agreed upon schedule, on a daily basis, and
Customer will transmit to Equifax the appropriate product orders in mutually
agreed upon formats. Micro 6X locations will call into the Equifax Network as
necessary.
B. Return System:
Equifax will return information reports to Customer in electronic formats to be
mutually agreed upon by the parties. These reports will be batch transmitted
electronically to Customer's cental data center on a daily basis at a
predetermined, mutually agreed upon schedule, or if applicable, returned, via
the mail, or to Customer on a magnetic tape/cartridge. It shall be Customer's
responsibility to distribute all information reports to its appropriate field
office.
C. MOTOR VEHICLE RECORDS:
MVRs from states with data processing capabilities, ("Tape-Out States"), will be
batch transmitted as described in B above. MVRs from states not having data
processing capabilities, ("Paper-Out States"), will be mailed in paper format to
the appropriate Customer location. Equifax will be responsible for mailing
costs associated with delivering MVRs from "Paper-Out States".
III. PRODUCT PRICING:
Pricing is based on Customer's purchase from Equifax eighty five percent (85%)
of its need for the types of products listed below, except Motor Vehicle Records
(MVR) from those states where Customer purchases online MVR services from the
state.
A. COMPREHENSIVE LOSS UNDERWRITING EXCHANGE (C.L.U.E.):
1. C.L.U.E. Auto - Rates are per inquiry:
1996 1997 1997 1998
7/1 THRU 1/1 THRU 7/1 THRU 1/1 THRU
12/31 6/30 12/31 6/30
----- ----- ----- -----
Household $2.15 $1.90 $1.80 $1.80
Household Plus $1.50 $1.50 $1.50 $1.50
B. MOTOR VEHICLE RECORDS (MVR):
Customer will be billed a surcharge rate of $0.10 per MVR order for all states
except, Alaska which will be billed at the rate of $1.00. Massachusetts and
Hawaii will be at the published survey rates.
Online MVRs will be billed at a rate of -- Surcharge + $0.30 if PC ordered, or
surcharge plus $0.10 if Mainframe leased line on Advantis at Customer cost.
In addition, Customer will be billed for state registry fees and applicable
state taxes.
IV. OTHER PRICING PROVISIONS:
A. All rates quoted are exclusive of any taxes impose or that may be imposed by
the various states.
B. If Customer elects to use the Equifax-maintained, Minnesota MVR Database,
there is no charge for State Registry. An additional $0.10 is added for each
named driver when this service is used. This surcharge is subject to change in
any amount, with thirty (30) day notice.
C. If Customer elects to use electronic return of Hawaii MVRs, there is an
add-on charge of $0.50 in addition to the Customer's MVR surcharge rate. This
add-on charge is subject to change with thirty (30) day notice.
D. The registry fees on automated MVRs from Canadian Provinces will be billed as
the Province fee plus $0.45 (United States dollars).
E. The Equifax West Virginia Database allows customers to identify drivers with
or without violation activity. The system will identify drivers in the database
with violation and automatically order an MVR. On those drivers with NO
violation activity, Equifax will return a "clear" MVR from the database file at
a cost less than state registry.
If Customer elects to use the Equifax-maintained, West Virginia Database, there
is no charge for State Registry on "clear" MVRs. An additional $3.00 fee is
added when the resultant report is clear. This database fee is subject to change
in any amount, with thirty (30) days notice. On non-clear reports, customer is
billed only the surcharge rate plus state registry.
F. If Customer elects to use the Equifax Driver History Database, customer will
be billed as follows:
Age of Data Report Charge
0-30 Days 50% of State Registry plus MVR Surcharge*
31-60 Days 50% of State Registry plus MVR Surcharge*
61-90 Days 50% of State Registry plus MVR Surcharge*
91-120 Days 35% of State Registry plus MVR Surcharge*
* Refer to Section III.B of this agreement for the MVR Surcharge amount.
Percentage of State Registry is based on registry fees as of 5/1/93.
Excluding MVR Surcharge, Report Charge is subject to change in any amount with
thirty (30) days notice.
State Availability is subject to change without notice.
G. If Customer elects to use Equifax Duplicate Check system, there is a search
fee of $0.10 on each duplicate abstract found. This search fee is in addition to
the Customer's MVR surcharge rate.
H. If Customer elects to use the automated SR 22/26 feature, the charge is $0.50
if MVRs are processed through Equifax. The charge is $1.00 if Customer obtains
MVRs from another source. This service is now available in the states of
California and Ohio.
I. Customer will be billed an MVR surcharge rate of $1.75 for each MVR ordered
through the Equifax Iowa Laptop Service. This is in addition to the state
registry fee.
J. The Equifax California Prescreen Database allows customers to identify
drivers with or without violation activity during the past 6 or 12 months. The
system will identify drivers in the database with a violation and automatically
order an MVR. On those drivers with NO violation activity, Equifax will return a
"clear" MVR from the database file at a cost less than state registry via an
indicator in the order record. Equifax will read the database for either a 6
month or 12 month period.
If Customer elects to use the Equifax-maintained, California Prescreen Database,
there is no charge for the State Registry on "clear" MVRs. An additional $0.35
fee is added when the resultant report is clear. This database fee is subject to
change in any amount, with thirty (30) day notice. On "non-clear" reports,
Customer is billed only the current surcharge rate plus state registry.
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EQUIFAX
K. The Equifax South Carolina Prescreen Database allows customers to identify
drivers with or without violation activity during the past 6 or 12 months. The
system will identify drivers in the database with a violation and automatically
order an MVR. On those drivers with NO violation activity, Equifax will return a
"clear" MVR from the database file at a cost less than state registry via an
indicator in the order record. Equifax will read the database for either a 6
month or 12 month period.
If Customer elects to use the Equifax-maintained, South Carolina Prescreen
Database, there is no charge for the State Registry on "clear" MVRs. On
"non-clear" reports, Customer is billed only the current surcharge rate plus
state registry.
L. The Equifax New Hampshire File allows customers to identify drivers with or
without convictions over the past 6, 12 or 60 months. The system will identify
drivers in the file with a conviction and automatically order an MVR. On those
drivers with NO convictions, Equifax will return a "clear" MVR from the activity
file at a cost less than state registry.
If Customer elects to use the Equifax-maintained, New Hampshire Activity File,
there is no charge for the State Registry on "clear" MVRs. An additional $1.00
plus Customer MVR Surcharge fee is added when the resultant report is clear on a
6 month search. An additional $2.00 plus Customer MVR Surcharge fee is added
when the resultant report is clear on a 12 month search. An additional $4.00
plus Customer MVR Surcharge fee is added when the resultant report is clear on a
36 month search. This fee is subject to change in any amount, with thirty (30)
day notice. On "non-clear" reports, Customer is billed only the current
surcharge rate plus state registry.
V. PERFORMANCE GUARANTEE:
Should C.L.U.E., or MVRs ordered hereunder not be delivered to Customer within
twenty-four (24) hours following the agreed upon return schedule, Equifax shall
refund its product rates for surcharge only on C.L.U.E., or MVR exceeding this
time frame. This guarantee does not apply to any delays in service caused by
factors not solely within Equifax's control, including, but not limited to,
natural disasters, state system problems and utility interruptions. Should
Customer request such refunds they will contact their Equifax Account Executive
within fifteen (15) days of such performance occurrence.
VI. BILLING/INVOICING
Equifax shall furnish Customer with a monthly billing statement by account
number (each entity within Customer's locations may have single or multiple
accounts), which is due and payable upon receipt. Statement becomes delinquent
thirty (30) days from date of receipt. Interest shall accrue on any unpaid
balances at a rate of 1.5% per month. Should Customer have any billing
discrepancies they will contact their Equifax Account Executive immediately.
VII. FAIR INFORMATION PRACTICES:
A. If customer uses information provided by Equifax to rate or declare an
applicant/policyholder, not qualified for coverage, Customer will notify, in
writing, said applicant/policyholder, specifying the Equifax information
(product(s) that influenced this decision. Further, Customer will provide
applicant/policyholder Equifax's address and toll free national telephone number
such that Equifax can make full disclosure of any information reported or held
by Equifax on said applicant/policyholder.
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EQUIFAX
VIII. TERM/TERMINATION:
A. The term of this agreement is for two (2) years. This agreement shall become
effective on the first day of the month following execution by Equifax and shall
expire on June 30, 1998.
Either party may terminate this Agreement in the event of a material breach or
default of the other party's obligations hereunder. Such termination shall be
effective sixty (60) days after the terminating party sends written notification
to the party said to be in breach or default. Such termination shall not take
place if the party said to be in breach or default cures the specified breach or
default before the end of such sixty (60) day period.
IX. CONFIDENTIALITY:
A. Because Customer and Equifax will be participating in mutual discussions
relating to plans, products, or services which may require disclosure of
information considered by either party to be confidential, proprietary, and/or a
trade secret (hereinafter, "Information"), including pricing agreements related
to the service, each party mutually agrees to keep such Information strictly
confidential. The above-mentioned Information shall mean all Information
specifically identified prior to disclosure as being confidential, proprietary,
except such information as may: (1) have been already known by the party
receiving the Information; (2) be publicly revealed by the party originally
disclosing such Information; (3) become generally known in the trade or industry
through no fault of the party receiving the Information; or (4) be independently
developed by Party receiving the Information.
B. The parties agree to keep all such Information confidential and in trust for
each other for as long as the Information remains competitively sensitive or
advantageous to the party who originally disclosed such Information to any
person, except as may be expressly authorized by this Agreement or in writing by
the party who originally disclosed such Information.
C. Each party shall make use of such Information only for the purpose(s) for
which it was disclosed and shall disclose such Information only to those of its
employees who have a need to know in order to accomplish the purpose(s) of this
Agreement. Upon termination of this Agreement, each Party shall return to the
other Party all manuals, instructional materials, and reports of a general
nature regarding the services provided hereunder.
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EQUIFAX
X. GENERAL:
A. This Agreement shall not be modified in any way, except in writing executed
by an authorized representative of the parties.
B. If any provision of this Agreement shall be held to be invalid, illegal, or
unenforceable, the validity, legality, or enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
C. This Agreement shall not be assignable by either party without the prior
written consent of the other party, and any attempt to assign any rights, duties
or obligations hereunder without such consent shall be void.
D. This offer expires on July 15, 1996 unless signed by Customer and Equifax.
ACCEPTED AND AGREED TO: ACCEPTED AND AGREED TO:
EQUIFAX SERVICES INC. INTEGON CORPORATION
By: /s/ Xxxxx X. Xxx By: /s/ Xxxxxx X. Xxxxxxx
---------------------------- ---------------------------
Name: Xxxxx X. Xxx Name: Xxxxxx X. Xxxxxxx
-------------------------- -------------------------
Title: Vice President Title: Chief Operating Officer
-------------------------- -------------------------
Date: 7/10/96 Date: 7/9/96
-------------------------- -------------------------
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EQUIFAX
ADDENDUM TO THE
INFORMATION PRODUCTS AGREEMENT
BETWEEN
EQUIFAX SERVICES INC.
AND
INTEGON CORPORATION
THIS ADDENDUM TO THE INFORMATION PRODUCTS AGREEMENT ("Agreement") is made and
entered into by and between Equifax Services Inc., ("Equifax"), with an address
for the purposes of this Addendum at 0000 Xxxxxxxxx Xxxxxx, X.X. Xxxxxxx,
Xxxxxxx 00000, and Integon Corporation, ("Customer"), with an address for the
purposes of this Addendum at 000 Xxxx Xxxxx Xxxxxx, Xxxxxxx-Xxxxx, Xxxxx
Xxxxxxxx 00000.
This Addendum is subject to the terms and conditions of the above mentioned
Agreement.
The Agreement is hereby amended as follows:
Section I. PRODUCT DESCRIPTIONS, add a new paragraph C. National Credit File
(NCF):
"C. NATIONAL CREDIT FILE (NCF):
Equifax will provide Customer with credit history information from its
national repository of consumer credit records. These reports will
contain identification, employment, public record, collection, trade
account activity, consumer statement and inquiry history information
segments, as well as summary segment.
1. Casualty Loss Score (CLS) - Optional scoring is available as an add-
on service to NCF. The Casualty Loss Score and associated reason codes
are designed to focus underwriting attention on credit reports which
resemble those found to have statistically higher risks of claim
frequency and unfavorable loss ratio over a one-year period."
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EQUIFAX
Section III. PRODUCT PRICING, add a new paragraph C, National Credit File
(NCF):
"C. NATIONAL CREDIT FILE (NCF):
Rates are per inquiry:
NCF $1.10 (per report ordered)
CLS $0.40 (per report scored)"
Rates will become effective on the first day of the month following execution by
both parties.
ACCEPTED AND AGREED TO: ACCEPTED AND AGREED TO:
EQUIFAX SERVICES INC. INTEGON CORPORATION
By: /s/ Xxxxx X. Xxx By: /s/ Xxxxxx X. Xxxxxxx
--------------------- ---------------------------
Name: Xxxxx X. Xxx Name: Xxxxxx X. Xxxxxxx
------------------- -------------------------
Title: Vice President Title: Chief Operating Officer
------------------- -------------------------
Date: 7/10/96 Date: 7/9/96
------------------- -------------------------
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