1
EXHIBIT 10.6
AMENDMENT TO LIFE REINSURANCE CONTRACT BETWEEN
AMERICAN BANKERS LIFE ASSURANCE COMPANY OF FLORIDA AND
REINSURER SHOWN BELOW
REINSURER: Lifestar Reinsurance Limited
REINSURANCE AGREEMENT NUMBER: SF 950106
EFFECTIVE DATE OF REINSURANCE AGREEMENT: February 28, 1995
AMENDMENT NUMBER: 04
EFFECTIVE DATE OF THIS AMENDMENT: December 31, 1996
The Reinsurance Contract by and between American Bankers Life Assurance Company
of Florida ("American Bankers") and Reinsurer, to which this Amendment is
attached and made a part thereof, is hereby amended as follows:
1) Article I, Section A, Paragraphs 1 and 2 are hereby deleted in their
entirety and replaced with the following:
1. New Risks
One hundred percent (100%) of each and every life insurance risk up to
the maximum amount shown on the Schedule Page issued by American
Bankers on or after January 1, 1997 in respect to debtors of the
Producer(s) shown on the Schedule Page and the designated subsidiary
and affiliated corporations or companies of any of them.
2. In Force Risks
One hundred percent (100%) of each and every life insurance risk
issued by American Bankers on or prior to December 31, 1996 which was
in force on December 31, 1996, with respect to debtors of the
Producer(s) shown on the Schedule Page and the designated subsidiary
and affiliated corporation or companies of any of them, which is in
force as of the effective date of this agreement.
3. All risks on policies, certificates or contracts stated in 1 and 2
above will be ceded on the basis of earned premium.
2) Article III, Section A is hereby deleted in its entirety and replaced with
the following:
A. Reinsurer shall allow American Bankers a Ceding Fee in the amount of
six and one-half percent (6.50%) of net earned premiums with respect
to the risks described in Article I.A.1. and nine and three quarters
percent (9.75%) of net earned premium with respect to the risks
described in Article I.A.2 on each account of a Producer stated in the
Schedule
1
2
Page on all premiums ceded under this Contract. The Ceding Fee shall
become fully earned upon termination of this Contract and shall not be
subject to refunding thereafter, for any reason, including but not
limited to policy cancellations as provided in Article XV. The Ceding
Fee shall be in addition to any other fees as stated in the Schedule
Page.
3) Article V, Section A is hereby deleted in its entirety and replaced with the
following:
In consideration of the reinsurance as set forth in Article I,
American Bankers agrees to pay monthly to Reinsurer, based on the
statement set forth in Article IV for the preceding month and payable
as shown on the Schedule Page, one hundred percent (100%) of the net
earned premiums during the month, plus any decrease in claims reserves
during the month, if any, less the following deductions:
1. Losses and expenses paid (which shall include allocated and
unallocated loss adjustment expenses, paid claims and all
other losses);
2. Increase in claims reserves during the month, if any;
3. The ceding fee as stated in Article III;
4. Premium, municipal and other applicable taxes incurred by
American Bankers, net of any Quarterly Tax Debits or credits,
as applicable;
5. The incurred portion of, expense reimbursements or commissions
and any other acquisition expenses incurred by American
Bankers to any third party, such as a broker, producer or
their agents, and any amounts paid for license and special
ceding assessment fees, board, exchange, bureau or joint
underwriting assessments or guarantee fund assessments and any
administrative, management or service fees incurred, payable
or calculated on any premium subject to this Contract; and
6. Such operating and administrative expenses of American Bankers
which expenses result from requests from Reinsurer or
Producer(s) (as shown in Schedule Page attached hereto) for
material changes in the procedures or operations of American
Bankers to facilitate Reinsurer hereunder;
4) Article VII is hereby deleted in its entirety and replaced with the
following:
All reserves on risks ceded hereunder shall be maintained by American
Bankers
5) Article XV, Paragraph 2 is hereby deleted in its entirety and replaced with
the following:
Upon termination of this Contract, for any reason, this Contract, at
American Bankers' option, shall continue to apply to all risks ceded
or assumed hereunder prior to the effective date of such termination
until the expiration of said risks, subject to the
2
3
provisions of Article I hereof, or shall no longer apply to the risks
ceded or assumed hereunder, prior to the effective date of
termination.
6) Article XVII is hereby deleted in its entirety and subsequent Articles shall
be renumbered accordingly.
7) Pursuant to the change in Article VII as indicated above, all reserves held
by Reinsurer shall be transferred to American Bankers and Reinsurer shall pay
American Bankers, in cash, within ten (10) days of the execution of this
Amendment, forty seven and three fourths percent (47.75%) of the unearned
premium reserves plus one hundred percent (100%) of the claim reserves in
respect to all claims, known and unknown, subject to this Contract on the
Effective Date of the Amendment.
8) The attached Schedule Page Addendum reflects the new Producer Codes and
Ceding Fee as of the effective date of the Amendment.
All other terms and conditions other than the foregoing remain as written.
Witness: AMERICAN BANKERS LIFE ASSURANCE
COMPANY OF FLORIDA
("American Bankers")
By: /s/ Xxxx Xxxxxxxx By: /s/ Xxxx Xxxxxx
--------------------------- ---------------------------------------
Its: Vice President/Business Board Chairman
--------------------------------------
Date: February 19, 1997
-------------------------------------
Witness: LIFESTAR REINSURANCE LIMITED
("Reinsurer")
By: /s/ Xxxxxx X. Xxxx By: /s/ Xxxxx X. Xxxxxxxx
---------------------------- ---------------------------------------
Its: Vice President Finance
--------------------------------------
Date: February 14, 1997
-------------------------------------
3
4
AMENDMENT TO LIFE REINSURANCE CONTRACT BETWEEN
AMERICAN BANKERS LIFE ASSURANCE COMPANY OF FLORIDA AND
REINSURER SHOWN BELOW
SCHEDULE PAGE ADDENDUM No. 1
REINSURER: Lifestar Reinsurance Limited
REINSURANCE AGREEMENT NUMBER: SF 950106
EFFECTIVE DATE OF REINSURANCE AGREEMENT: February 28, 1995
PRODUCER Lifestar Reinsurance Limited
PRODUCER CODES: AL 19-8182 MT 19-8191
AK 19-8158 NE 19-8192
AZ 19-8183 NV 19-8193
AR 19-8184 NH 19-8169
CA 19-8159 NJ 19-8170
CO 19-8185 NM 19-8171
CT 19-8160 NC 19-8194
DE 19-8145 ND 19-8168
FL 19-8161 OH 19-8172
GA 19-8146 OK 19-8195
ID 19-8186 OR 19-8196
IL 19-8162 PA 19-8173
IN 19-8163 RI 19-8174
IA 19-8187 SC 19-8197
KS 19-8188 SD 19-8153
KY 19-8148 TN 19-8198
LA 19-8189 TX 19-8199
ME 19-8165 UT 19-8200
MD 19-8149 VT 19-8175
MA 19-8164 VA 19-8201
MI 19-8166 WA 19-8202
MN 19-8167 WV 19-8156
MS 19-8190 WI 19-8176
MO 19-8150 WY 19-8177
MAXIMUM AMOUNT: By Policy
4
5
CEDING FEE: Six and one-half Percent (6.50%) for New
Risks and Nine and Three Quarters
Percent (9.75%) for In Force Risks
OTHER FEES: Expense reimbursements or commissions
and any other acquisition expenses
incurred to any broker, producer or
their agents and any amounts incurred
for license and special ceding
assessment fees, board, exchange,
bureau or joint underwriting assessments
or guarantee fund assessments and any
administrative, management or service
fees incurred, payable or calculated on
any premium subject to this Contract.
PREMIUM TAX RATE: 2.5%
CHECKS PAYABLE TO: Lifestar Reinsurance Limited
EFFECTIVE DATE OF THIS AMENDMENT: December 31, 1996
Witness: AMERICAN BANKERS LIFE ASSURANCE
COMPANY OF FLORIDA
("American Bankers")
By: /s/ Xxxx Xxxxxxxx By: /s/ Xxxx Xxxxxx
----------------- ----------------------------------------------
Its: Vice President/Business Board Chairman
--------------------------------------------
Date: February 19, 1997
-------------------------------------------
LIFESTAR REINSURANCE LIMITED
("Reinsurer")
By: /s/ Xxxxxx X. Xxxx By: /s/ Xxxxx X. Xxxxxxxx
------------------ ---------------------------------------------
Its: Vice President Finance
--------------------------------------------
Date: February 14, 1997
-------------------------------------------
5
