No. 3154-0016
PROPERTY AND CASUALTY
EXCESS OF LOSS REINSURANCE AGREEMENT
between
PENN-AMERICA INSURANCE COMPANY
PENN-STAR INSURANCE COMPANY
and
AMERICAN RE-INSURANCE COMPANY
TABLE OF CONTENTS
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ARTICLE PAGE
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I EXHIBITS COVERED 1
II TERRITORY 1
III ULTIMATE NET LOSS 2
IV EXTRA CONTRACTUAL
OBLIGATIONS 2
V EXCESS JUDGMENTS 3
VI EXCLUSIONS 4
VII DEFINITIONS 17
VIII CLAIMS 21
IX SUBROGATION AND SALVAGE 22
X TAXES 22
XI ACCESS TO RECORDS 22
XII INSOLVENCY 23
XIII OFFSET AND SECURITY 23
XIV ERRORS AND OMISSIONS 24
XV FEDERAL EXCESS RECOVERY 24
XVI COMMENCEMENT AND
TERMINATION 25
No. 3154-0016
PROPERTY AND CASUALTY
EXCESS OF LOSS REINSURANCE AGREEMENT
------------------------------------
THIS AGREEMENT made and entered into by and between PENN-AMERICA INSURANCE
COMPANY, PENN-STAR INSURANCE COMPANY, both of Hatboro, Pennsylvania (hereinafter
referred to as the "Company") and AMERICAN RE-INSURANCE COMPANY, a Delaware
Corporation with Administrative Offices in Princeton, New Jersey (hereinafter
referred to as the "Reinsurer").
WITNESSETH:
The Reinsurer hereby reinsures the Company to the extent and on the terms and
conditions and subject to the exceptions, exclusions and limitations hereinafter
set forth and nothing hereinafter shall in any manner create any obligations or
establish any rights against the Reinsurer in favor of any third parties or any
persons not parties to this Agreement. Performance of the obligations of each
party under this Agreement shall be rendered solely to the other party.
ARTICLE I
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EXHIBITS COVERED
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The Company will reinsure with the Reinsurer and the Reinsurer will accept
reinsurance from the Company as set forth in Exhibits A and B which are attached
hereto and made a part of this Agreement, such Exhibits being entitled for
purposes of identification as:
EXHIBIT A - PROPERTY EXCESS OF LOSS
EXHIBIT B -CASUALTY EXCESS OF LOSS
ARTICLE II
----------
TERRITORY
---------
A. As respects Property business of the Company, this Agreement shall
cover policies issued for risks located within the United States of
America, its territories and possessions, and Canada.
B. As respects Casualty business of the Company, this Agreement shall
follow the original policies of the Company.
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ARTICLE III
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ULTIMATE NET LOSS
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A. The term "Ultimate Net Loss" shall mean the sum or sums paid by the
Company for which it is liable, under policies reinsured hereunder,
including any Loss Adjustment Expenses, as hereinafter defined.
Ultimate Net Loss shall also include 90% of any Extra Contractual
Obligations, as provided in ARTICLE IV, EXTRA CONTRACTUAL
OBLIGATIONS; and 90% of any Excess Judgment, as provided in ARTICLE
V, EXCESS JUDGMENTS. All sums hereunder shall be subject to proper
deductions for all salvages, recoveries and all other reinsurances
or insurances that inure to the benefit of the Reinsurer under this
Agreement, whether collectible or not. The Reinsurer's liability
hereunder shall not increase by reason of the inability of the
Company to collect from any other reinsurer or insurer, for any
reason, any amount that may be due from such reinsurer or insurer.
B. Except as specifically provided for or excluded under this Article,
the term "Loss Adjustment Expenses" shall mean all expenses which
have been paid by the Company in the investigation, adjustment,
settlement or defense of specific claims covered under original
policies of the Company reinsured hereunder, (also including
prejudgment and post-judgment interests and salaries and expenses of
salaried adjusters associated therewith), but not including office,
administrative or overhead expenses of the Company or salaries and
expenses of its officials and employees.
C. In the event of the insolvency of the Company, "Ultimate Net Loss"
shall be as otherwise defined herein except it shall include the sum
or sums which the Company has incurred for which it is liable
instead of the sum or sums paid by the Company for which it is
liable, and payment by the Reinsurer shall be made to the
liquidator, receiver or statutory successor of the Company in
accordance with the INSOLVENCY Article.
ARTICLE IV
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EXTRA CONTRACTUAL OBLIGATIONS
-----------------------------
A. As reinsured under this Agreement, the Company shall be protected
for any Extra Contractual Obligation awarded by a court of competent
jurisdiction against the Company. (Such Extra Contractual Obligation
shall be added to the amount of the award or settlement within the
Company's policy limit and the sum thereof shall be considered one
loss subject to the exclusions and limitations set forth in this
Agreement.)
B. "Extra Contractual Obligation" shall be defined as those liabilities
not covered under any other provision of this Agreement, and any
legal costs and expenses incurred in connection therewith, which
arise from the Company's handling of
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any claim on business covered hereunder, including but not limited
to, the failure by the Company to settle within the policy limit,
or by reason of alleged or actual negligence, fraud, or bad faith,
in rejecting an offer of settlement, in the preparation of the
defense, in the trial of any action against its insured or in the
preparation or prosecution of an appeal consequent upon such
action.
C. For the purpose of the application of this Agreement, an Extra
Contractual Obligation shall be deemed to have arisen on the same
date as the original loss that gave rise to the Extra Contractual
Obligation.
D. This Article shall not apply where the Extra Contractual Obligation
has been incurred due to the fraud or criminal act of a member of
the Board of Directors, an officer, an agent, or an employee of the
Company or any other person or organization involved in the
presentation, defense or settlement of any claim covered hereunder,
whether acting individually or collectively or in collusion with any
person or organization.
E. Recoveries from any form of insurance or reinsurance, whether
separately purchased from another insurance carrier or self
insurance issued by the Company to itself, which protects the
Company against claims which are the subject matter of this Article,
will inure to the benefit of the Reinsurer and shall be first
deducted to arrive at the amount of any Extra Contractual Obligation
covered hereunder, whether collectible or not.
F. If any provision of this Article shall be rendered illegal or
unenforceable by the laws, regulations or public policy of any
state, such provision shall be considered void in such state, but
this shall not affect the validity or enforceability of any other
provision of this Agreement or the enforceability of such provision
in any other jurisdiction.
ARTICLE V
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EXCESS JUDGMENTS
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A. As reinsured under this Agreement, the Company shall be protected
for any Excess Judgment awarded by a court of competent jurisdiction
against the Company. (Such Excess Judgment shall be added to the
amount of the award or settlement within the Company's policy limit
and the sum thereof shall be considered one loss subject to the
exclusions and limitations set forth in this Agreement.)
B. "Excess Judgment" shall mean any amount in excess of the Company's
original policy limits, but otherwise within the coverage terms of
the policy, that is paid by the Company, together with any legal
costs and expenses incurred in connection therewith, resulting from
the failure by the Company to settle within the policy limit, or by
reason of alleged or actual negligence, fraud, or bad faith, in
discharging its duty to defend, in preparing the defense in an
action against its
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insured or in discharging its duty to prepare or prosecute an
appeal consequent upon such action.
C. This Article shall not apply where the Excess Judgment has been
incurred due to the fraud or criminal act of a member of the Board
of Directors, an officer, an agent or an employee of the Company, or
any other person or organization involved in the presentation,
defense or settlement of any claim covered hereunder, whether acting
individually or collectively or in collusion with any person or
organization.
D. Recoveries from any form of insurance or reinsurance, whether
separately purchased from another insurance carrier or self
insurance issued by the Company to itself, which protects the
Company against claims which are the subject matter of this Article,
will inure to the benefit of the Reinsurer and shall be first
deducted to arrive at the amount of any Excess Judgment hereunder,
whether collectible or not.
D. If any provision of this Article shall be rendered illegal or
unenforceable by the laws, regulations or public policy of any
state, such provision shall be considered void in such state, but
this shall not affect the validity or enforceability of any other
provision of this Agreement or the enforceability of such provision
in any other jurisdiction.
ARTICLE VI
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EXCLUSIONS
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A. The reinsurance provided under this Agreement is subject to the
exclusions set forth below and shall not cover the excluded
coverages, risks or exposures unless individually submitted by the
Company to the Reinsurer for inclusion hereunder, and if specially
accepted in writing by the Reinsurer, such business shall then be
covered under the terms of this Agreement, except to the extent the
terms of this Agreement are modified by the special acceptance.
B. The reinsurance provided under this Agreement shall not apply to the
following:
1. Business derived from any Pool, Association (including Joint
Underwriting Associations), Syndicate, Exchange, Plan, Fund or
other facility directly as a member, subscriber or
participant, or indirectly by way of reinsurance or
assessments. This exclusion shall not apply to automobile
assigned risks or workers' compensation assigned risks which
may be currently or subsequently covered hereunder, except
such assigned risks arising from property or umbrella
coverages.
2. Liability of the Company arising from its participation or
membership, whether voluntary or involuntary, in any
insolvency fund, including any guarantee fund, association,
pool, plan or other facility which provides for the assessment
of, payment by, or assumption by the Company of a part or
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the whole of any claim, debt, charge, fee or other obligations
of an insurer, or its successors or assigns, which has been
declared insolvent by any authority having jurisdiction.
3. Except as respects Workers' Compensation business hereunder,
liability excluded by the provisions of the following Nuclear
clauses attached hereto. The word "Reassured" used therein
means "Company."
USA:
- Liability - Reinsurance No. 1B
- Physical Damage - Reinsurance No. 2
- Physical Damage and Liability
(Boiler and Machinery) - Reinsurance No. 3.
Canada:
- Liability - Reinsurance Canada Pre 1985
- Physical Damage - Reinsurance Canada Pre 1985
- Liability - Reinsurance Canada Post 1985
- Physical Damage - Reinsurance Canada Post 1985
- Physical Damage and Liability Canada -Reinsurance (Boiler
and Machinery)
As respects Workers Compensation business hereunder,
operations employing the process of nuclear fission or fusion
or handling of radioactive material, which operations include
but are not limited to:
1. the use of nuclear reactors such as atomic piles,
particle accelerators or generators, or
2. the use, handling or transportation of radioactive
materials, or
3. the use, handling or transportation of any weapon of war
or explosive device employing nuclear fission or fusion
The preceding exclusions a., b., and c. do not apply to:
a. the exclusive use of particle accelerators incidental to
ordinary industrial or educational research pursuits, or
b. the exclusive use, handling or transportation of radio
isotopes for medical or industrial use;
c. radium or radium compounds.
4. Coverage provided by the Company to insurance, or reinsurance
companies, captives, brokers or risk retention groups (each
hereinafter referred to as "insured" for purposes of this
exclusion) which provide insurance against liability of the
insured for any damages resulting from alleged or actual
tortious conduct by the insured in the handling of claims
brought against any policyholders of the insured or in the
handling of any other business matters with or on behalf of
any policyholders.
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5. The following coverages:
a. Financial Guarantees;
b. Credit and Fidelity Coverage;
c. Surety Bonds;
d. Warranty Coverage;
e. Political Risk Coverage;
f. Currency Exchange Coverage;
g. Forgery Coverage; or
h. Kidnap, Extortion or Xxxxxx Coverage.
6. Aggregate Excess of Loss or Stop Loss Coverages.
7. Retroactive Coverage, except in connection with unknown
incidents, covered under a claims made coverage.
8. Coverage provided on a co-indemnity basis with another
insurer, reinsurer or other entity including an insured under
the Company's policy; however, this exclusion does not apply
to the standard co-insurance provisions of a policy and
facultative reinsurance inuring to the benefit of this
Agreement.
9. Coverage underwritten or accepted by any third party except
the binding authority granted by the Company to its duly
authorized agents.
10. Coverage written specifically to insure or reinsure punitive
damages.
11. Entertainment business, including but not limited to,
Commercial Negative Film Coverage, Cast Coverage and
Completion Bond Coverage.
12. The Company's liability and any related expenses, beyond
circumscribed policy provisions, including but not limited to,
punitive, exemplary, consequential or compensatory damages,
resulting from a claim of an insured or an insured's assignee
against the Company its agents or employees, except as
provided for in the Extra Contractual Obligations and Excess
Judgments Articles.
13. All reinsurance assumed by the Company, except intra-Company
pooling arrangements.
14. All loss, cost or expense arising out of, resulting as a
consequence of or related to War. "War", as utilized herein,
shall mean war whether or not declared, civil war, martial
law, insurrection, revolution, invasion, bombardment or any
use of military force, usurped power or confiscation,
nationalization or damage of property by any government,
military or other authority.
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To the extent there is no Insurance Service Office, Inc.
current standard coverage form for a type of coverage
reinsured under this agreement, "War" as utilized herein shall
mean war whether or not declared, civil war, martial law,
insurrection, revolution, invasion, bombardment or any use of
military force, usurped power or confiscation, nationalization
or damage of property by any government, military or other
authority.
15. All loss, cost or expense directly or indirectly arising out
of, resulting as a consequence of or related to Pollution
whether or not there is another cause of loss which may have
contributed concurrently or in any sequence to a loss.
"Pollution" means any solid, liquid, gaseous or thermal
irritant or contaminant, including smoke, vapor, soot, fumes,
acids, alkalis, chemicals and waste. Waste includes materials
to be recycled, reconditioned or reclaimed.
This exclusion shall not apply to the extent that such
liabilities would be covered under the current standard
unendorsed coverage forms issued by Insurance Services Office,
Inc. for each type of coverage reinsured under this Agreement.
16. Space or space-related risks such as, but not limited to,
satellites, spacecraft, launch sites and launch vehicles
including cargo and freight carried therein, in all phases of
operation.
17. a. Any coverage written specifically to apply to
Internet exposures; or
b. Any loss, cost or expense arising out of or related
to the Internet, except if covered under any coverage
not written or endorsed specifically to apply to
Internet exposures. Notwithstanding the above
referenced exception, the reinsurance provided under
this agreement shall not apply to the following
persons, entities or exposures, except for in force
policies with effective dates prior to 9/1/01 and
covered under this Agreement:
(1) Internet Service Providers, meaning any person or
entity providing access to the Internet, content
over the Internet or connection to the Internet;
or
(2) Application Service Providers, meaning any person
or entity that provides software and associated
services to a subscriber base across an area
network; or
(3) Internet Backbone Providers, meaning any person or
entity that routes or provides channels for
packets that transport data from point to point on
the Internet; or
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(4) Any person or entity that derives ninety percent
or more of gross revenue or conducts or executes
ninety percent or more of business transactions on
or through the Internet; or
(5) Any person or entity that provides electronic mail
services; or
(6) Any person or entity that develops, supplies,
and/or installs encryption software for use on the
Internet.
"Internet" as utilized in this exclusion shall mean, the
international computer network of interoperable packet
switched data networks, also known as the worldwide web or
worldwide network of computers.
18. All Workers' Compensation business, except for Employers'
Liability Stop Gap coverage.
19. All automobile Liability business when written as such.
20. As respects Property business, all loss, cost or expense
arising out of or related to, either directly or indirectly,
any "Terrorist Activity," as defined DEFINITIONS Article, and
any action taken to hinder, defend against or respond to any
such activity. This exclusion applies regardless of any other
cause or event that in any way contributes concurrently or in
any sequence to the loss, cost or expense and for the
following:
a) Any one risk at any one location where the risk Total
Insured Value (hereinafter TIV), inclusive of all
coverages is greater than $50,000,000; or
b) The aggregate TIV for all risks insured by the company
at any one location, inclusive of all coverages is
greater than $50,000,000,; or
c) Locations written on a subscription basis where the 100%
TIV, inclusive of all coverages is greater than
$50,000,000; and
d) Any of the following risks (i.e., owners of, not tenants
in):
1. Airlines or Airports
2. Apartments, Condos, or Co-Operatives (i.e., Urban
Only and greater than 25 stories)
3. Bridges (i.e., greater than 300 feet in length)
4. Casinos of Las Vegas and Atlantic City only
5. Chemical Manufacturing or Distributing Companies
except for liability arising from the retail sale
or wholesale distribution of household chemicals
by insureds not engaged in their manufacture
6. Convention or Exhibition Centers (i.e., Urban
only) with an expected capacity, at any one time,
of 25,000 or more
7. Dams (i.e., greater than 300 feet in length) 8.
Defense or Aerospace Industries
9. Department Stores that are part of malls over
1,000,000 sq. feet
-8-
10. Financial Institutions (i.e., Building. and Time
Element coverages or multiple locations (i.e.,
Office Schedules of greater than 10,000 sq. feet
per location))
11. Government buildings (i.e., Federal or State) and
National Landmarks
12. High Tech Manufacturing Companies and
Telecommunication Companies with Total Insured
Values greater than $5,000,000.
13. Hospitals (i.e., Urban only)
14. Hotels (i.e., Urban only and greater than 25
stories)
15. Internet Companies and Major Media Companies with
Total Insured Values greater than $5,000,000.
16. Office Buildings (i.e., Urban only and greater
than 25 stories)
17. Oil and Gas Manufacturing or Distributing
Companies
18. Public School Districts (i.e., Urban only)
19. Port or Transit Authorities
20. Railroads
21. Shopping Malls over 1,000,000 sq. feet
22. Stadiums (i.e., all pro sports)
23. Tunnels (i.e., greater than 300 feet in length)
24. Universities (i.e., Urban only)
25. Utilities electric, gas, water & sewer
C. The reinsurance provided under this Agreement for Liability
business, other than Workers Compensation, and Automobile
Liability business, shall not apply to the following:
1. Professional Liability or Errors and Omissions Coverage
other than for the following:
a. "Beau-T-Pak";
b. Barbers;
c. Opticians;
d. Veterinarians that treat household pets;
e. Morticians;
f. Clergy;
g. Employee Benefits Liability (E&O Coverage);
h. Druggists;
i. "Day Care Pak";
j. "Adult Day Care;
k. "Health Club Pak";
l. "Instructor Pak";
m. In-Home Day Care;
n. "Pet Pak"; or
o. "Wellness Pak".
2. Directors' and Officers' Liability Coverage, except for
Condominiums and Homeowners Associations.
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3. The following coverages:
a. Product recall;
b. Product tampering;
c. Product integrity impairment; or
d. Product guarantee.
4. Coverage provided under or for liability arising from
any federal law, including but not limited to; USL&H,
Xxxxx Act, Defense Base Act, Federal Employers'
Liability Act, Outer Continental Shelf Lands Act, the
Federal Coal Mine Health and Safety Act of 1969, the
Non-appropriated Fund Instrumentality's Act, any other
federal law awarding damages for violation of those laws
or regulations issued there under and any amendments to
any of the aforementioned laws or regulations.
5. Securities Act Liability Coverage (S.E.C. Liability).
6. Commercial Umbrella or Excess Liability Coverage.
7. Personal Umbrella Liability Coverage.
8. Environmental Impairment Liability Coverage.
9. Products Liability Coverage written without an annual
aggregate limit.
10. Employer's liability and/or common law liability of
employer's to their employees when coverage is provided
under Worker's Compensation Coverage.
11. Protection and Indemnity Liability Coverage.
12. Primary coverage written on a deductible basis or excess
of a self-insured retention when such deductible or
retained amounts are greater than $50,000.
13. Uninsured or Underinsured Motorists Coverage.
14. Advertising or Personal Injury Liability Coverage for
any person or entity whose business is advertising,
broadcasting, publishing or telecasting.
15. Aircraft and airports as respects coverage for all
liability arising out of the ownership, maintenance or
use of aircraft and/or flight or ground operations.
16. Blanket or all-risk type coverage, commonly known as
Organizational Liability, Organization Liability,
Operational Liability, Integrated Risk, Enterprise Risk
or under similar names, written in, or endorsed to, a
policy covering all types of losses incurred by, or
claims against, an entity;
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provided, however, that this exclusion shall not include
any named-peril grant of coverage which contemplates
specifically enumerated types of claims or losses.
17. Liability, including any related expenses directly or
indirectly arising out of, resulting as a consequence
of, or related to employment-related practices,
including, but not limited to liability related to
harassment, wrongful termination or discrimination,
whether under coverage written as such or otherwise.
18. Liability including any related expenses, arising out of
the Employee Retirement Income Security Act of 1974 and
amendments thereto.
19. Liability including any related expenses, directly or
indirectly arising out of, resulting as a consequence of
or related to Sexual Misconduct, whether or not there is
another cause of loss which may have contributed
concurrently or in any sequence to a loss for the
Company's Day Care Pak, In Home Day Care Pak or Adult
Day Care policies, except for in force policies with
effective dates prior to 9/1/01, and for Day Care Pak,
In Home Day Care Pak or Adult Day Care policies of the
Company where the insured purchases the Company's
buy-back coverage.
"Sexual Misconduct" as utilized herein shall include,
sexual molestation, sexual harassment, sexual abuse, any
verbal or nonverbal communication, behavior, or conduct
with sexual connotations or the infliction of physical,
emotional or psychological injury whether for purpose of
sexual gratification, discrimination, intimidation,
coercion or other sexual purpose, regardless of whether
such action or resulting injury is alleged to be
intentionally or negligently caused.
20. All loss, cost or expense directly or indirectly,
arising out of, resulting as a consequence of, or
related to the manufacture, distribution, testing,
remediation, removal, storage, disposal, sale, use of or
exposure to the following, whether or not there is
another cause of loss which may have contributed
concurrently or in any sequence to a loss:
a. Asbestos or materials or products containing
asbestos;
b. 2.4,5 Trichloroacetic acid ("2,4,5-1") or 2.3,7,8
- TCDD;
c. Diethylstilbestrol ("DES") in any dosage or form
Any intrauterine device ("IUD");
d. Any product containing silicone, which is in any
form injected or implanted into the body;
e. Phen-fen;
f. Dioxin;
g. Polychlorinated biphenyls;
h. Lead or materials or products containing lead;
i. Latex gloves;
j. Polybutylene piping
(acrylonitrile-butadine-styrene); or
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k. Bio-engineered products, including any food
products or therapeutic or diagnostic
pharmaceutical products which are developed using
some form of bioengineering.
21. All loss, cost or expense directly arising out of,
resulting as a consequence of, or related to
Electromagnetic Radiation related to the manufacture or
generation of:
a. Electric power and/or power lines;
b. Cellular phones;
c. Radio and TV broadcasting and/or towers except for
insured's with total sales less than $500,000;
d. Computers;
e. Electric blankets;
f. Military radar or weapons;
g. Police or weather radar;
h. Satellite stations;
i. Magnetic resonance imaging equipment;
j. X-ray equipment, except sales that are 10% or less
of insured's total sales; or
k. Microwave ovens;
"Electromagnetic Radiation" as used herein, shall include
magnetic energy waves, fields or forces generated, produced,
distributed, transmitted or maintained by charges, currents,
frequencies, forces of energy or electricity."
22. Products Liability or Completed Operations Liability
related to:
a. Drugs, except for liability arising from the
retail sale or wholesale distribution of drugs by
insureds not engaged in their manufacture;
b. Chemicals, except for liability arising from the
retail sale or wholesale distribution of household
chemicals by insureds not engaged in their
manufacture;
c. Insecticides and pesticides, except sales that are
20% or less of insured's total sales;
d. Aircraft or aircraft parts;
e. Animal feed, other than custom-blended grains
without chemical or pharmacological additives,
except sales that are 20% or less of insured's
total sales;
f. Cosmetics manufacturing, except for the
manufacture of soaps or shampoos where the
insured's receipts are less than 10% of total
sales or skin and hair care products prepared at
beauty salons or similar establishments,
g. Tobacco and tobacco products, but this exclusion
shall not apply to liability arising from the
retail sale or wholesale distribution of tobacco
products by insureds not engaged in their
manufacture;
h. Automobiles, trucks, motorcycles and all-terrain
vehicles or component parts critical to the
operation of the foregoing,
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but this exclusion shall not apply to the
liability arising from the retail sale or
wholesale distribution of component parts critical
or non-critical to the operation of the foregoing
not engaged in their manufacture;
i. Fiberglass, but this exclusion shall not apply to
liability arising from the retail sale or
wholesale distribution of fiberglass products by
insureds not engaged in their manufacture;
j. Firearms, except sales that are 20% or less of
insured's total sales;
k. Medical equipment;
l. Elevator or hoist manufacturing, installation,
inspection, service or repair;
m. Security and alarm system manufacturing,
installation, inspection, service or repair,
except for coverage as provided for in the
Company's guidelines as of 9/01/01; or
n. Fire suppression system manufacturing,
installation, inspection, service or repair,
except for coverage as provided for in the
Company's guidelines as of 9/01/01.
23. Wrecking or demolition of buildings, structures,
watercraft or aircraft, except for buildings three
stories or less.
24. Railroad, subway and street railway construction,
operation or maintenance, excepting sidetrack
agreements.
25. Bridge, tunnel, dam or reservoir design, construction,
operation or maintenance.
26. Mining, except insureds with receipts from quarry
operations of less than 5% of total sales.
27. Onshore or offshore gas or oil drilling operations,
pipelines, or xxxxx.
28. Mill or grain elevator operation.
29. Manufacture, assembly, packing, handling, processing,
transportation, sale, storage or detonation of
fireworks, fuses, nitroglycerine, ammonium nitrate,
magnesium, celluloid, pyroxylin, ammunition, explosives
or any product in which an explosive substance is an
ingredient, or component part.
The term "explosive substance," as used herein, is any
substance manufactured for the express purpose of
exploding as differentiated from those commodities,
other than those commodities specified in this
exclusion, which are only fortuitously explosive, such
as gasoline, fuel oil, or dyestuffs.
30. Manufacture, production, refining, storage, sale,
distribution or transportation of natural or artificial
fuel, gas, butane, methane, propane,
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other liquefied petroleum gases, gasoline or gases or
air under pressure, except this exclusion does not apply
to gasoline at hardware stores, convenience stores and
automobile service stations storing gasoline on premises
for retail sale, fuel oil dealers, and LPG sales that
are 20% or less of the insured's total sales.
31. Stevedoring.
32. Ski lodges, lifts, cable cars and tows.
33. Shipbuilding, ship repair, ship breaking, dry dock, and
quays or wharf operations, except boat slips or docks
that are incidental to restaurants, condominiums, or
similar operations or risks.
34. Watercraft over 50 feet in length.
35. Amusement parks, amusement devices (other than coin
operated devices), fairs, exhibitions, carnivals,
circuses and zoos (other than petting zoos), except when
written within the guidelines of the of the Company's
Special Events Program.
36. Sports or other entertainment events with an expected
capacity, at any one time, of 25,000 or more people.
37. Arenas, grandstands, stadiums, theatres, halls and any
other indoor venue with an expected capacity, at any one
time, of 25,000 or more.
38. Electric and gas utilities and the municipalities,
authorities and all boards, commissions, or entities
responsible for administering or controlling these
utilities.
39. Governmental agencies, entities, or political
subdivisions of a state or municipalities with a
population of 50,000 or more, except for insureds
required to name the local municipality as a named
insured for special events.
40. Insurance companies, agents, brokers, or risk retention
groups, inspection services, claims services and rating
bureaus, unless coverage for errors and omissions is
excluded under the policy reinsured.
41. School boards or school districts.
42. Nursing homes and nursing home care, except for adult
day care centers or the Family Home Care Program when
written within the Company guidelines as of 9/01/01.
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43. Banks and other financial institutions unless the
Company's coverage contains a financial institution
endorsement agreed to by the Reinsurer.
44. Contractors engaged in the construction, erection or
exterior maintenance of structures in excess of three
stories, except for window washers or power washing
operations.
45. Crop-dusting.
46. Insureds in the business of Scaffold manufacture,
installation, repair, removal or rental.
47. Inverse condemnation liability.
48. All loss, cost or expense arising out of, resulting as a
consequence of or related to poultry products,
operations or exposures, including but not limited to;
poultry houses, poultry processing operations, live
birds, processed birds, egg laying operations, egg
processing operations or eggs.
49. Contractors, except as provided for by the Company's
Penn Amerigram dated November 7, 2001, and attached to
this Agreement as APPENDIX B.
D. In the event the Company is inadvertently bound on any
exclusion enumerated under paragraph D, the reinsurance
provided under this Agreement shall apply until discovery by
the Company of the existence of the inadvertent binding and
for 30 days thereafter, and shall then cease unless, within
the 30-day period, the Company has received from the Reinsurer
written notice of its approval of such binding.
E. The reinsurance provided under this Agreement for Property
business shall not apply to the following:
1. Difference in Conditions Coverage.
2. Ocean Marine Coverage.
3. Mortgage impairment insurance and similar kinds of
insurance, however styled.
4. Mining including mining equipment.
5. Aviation business.
6. The following coverages:
a. Product recall;
b. Product tampering;
-15-
c. Product integrity impairment; or
d. Product guarantee.
7. Excess Coverage, meaning coverage written to apply
specifically in excess over underlying insurance.
8. Boiler and Machinery Coverage.
9. Livestock Mortality or Fertility Coverage.
10. Furriers' and Jewelers Block Coverage.
11. Contingency business interruption risks of any kind.
12. Transmission and distribution lines other than those
within 500 feet of an insured's premises. It is
understood and agreed that public utilities extension
and/or suppliers extension and/or contingent business
interruption coverage are not subject to this exclusion
provided that these are not part of a transmitter's or
distributor's policies.
13. All onshore or offshore:
a. gas and oil drilling risks;
b. petrochemical risks;
c. pipeline risks; or
d. well risks.
14. Flood, surface water, waves, tidal water or tidal waves,
overflow of streams or other bodies of water or spray
from any of the foregoing, all whether driven by wind or
not; provided, however, this exclusion shall not apply
to losses covered under automobile physical damage
policies or Inland Marine Policies.
15. Earthquake, landslide and other earth movement provided,
however, this exclusion shall not apply to automobile
physical damage coverage or Inland Marine Policies.
16. Railroad property, rolling stock, tracks or roadbeds.
17. Fine arts collections exceeding $5,000,000 in total
value.
18. Mobile homes, except mobile home parks written on a
commercial lines basis with less than 25% of the mobile
homes being owned by the insured.
19. Risks having total insurable value of more than
$50,000,000.
20. Growing, standing or drying crops and timber.
-16-
21. Watercraft except watercraft insured under personal
property floaters.
22. Bridges, dams and tunnels.
23. All loss, cost or expense arising out of, resulting as a
consequence of or related to poultry products,
operations or exposures, including but not limited to;
poultry houses, poultry processing operations, live
birds, processed birds, egg laying operations, egg
processing operations or eggs.
ARTICLE VII
-----------
DEFINITIONS
-----------
A. The following Definitions apply as respects all Property
business:
I. Property Occurrence:
A. The term "Occurrence" shall mean the sum of all
individual losses directly occasioned by any one
disaster, accident or loss or series of disasters,
accidents or losses arising out of one event which
occurs within the area of one state of the United States
or province of Canada and states or provinces contiguous
thereto and to one another. However, the duration and
extent of any one "Occurrence" shall be limited to all
individual losses sustained by the Company occurring
during any period of 168 consecutive hours arising out
of and directly occasioned by the same event except that
the term "Occurrence" shall be further defined as
follows:
1. As regards windstorm, hail, tornado, hurricane,
cyclone, including ensuing collapse and water
damage, all individual losses sustained by the
Company occurring during any period of 72
consecutive hours arising out of and directly
occasioned by the same event. However, the event
need not be limited to one state or province or
states or provinces contiguous thereto.
2. As regards riot, riot attending a strike, civil
commotion, vandalism and malicious mischief, all
individual losses sustained by the Company
occurring during any period of 72 consecutive
hours within the area of one municipality or
county and the municipalities or counties
contiguous thereto arising out of and directly
occasioned by the same event. The maximum duration
of 72 consecutive hours may be extended in respect
of individual losses which occur beyond such 72
consecutive hours during the continued occupation
of an assured's premises by strikers, provided
such occupation commenced during the aforesaid
period.
3. As regards earthquake (the epicenter of which need
not necessarily be within the territorial confines
referred to in the opening paragraph of this
Article) and volcanic eruption, all of the
-17-
Company's individual losses (including losses from
other perils covered hereunder which directly
arise from earthquake and volcanic eruption) which
occur during a period of 168 consecutive hours
shall be considered one "Occurrence". The term
"earthquake" means one or more seismic
disturbances emanating from the same or adjacent
geological faults. The term "volcanic eruption"
means all activity arising from a single volcano.
4. As regards flood, being the overflowing of a
natural body of water caused by torrential rain
and the resulting inundation of the adjacent land,
all individual losses sustained by the Company
which occur during a period of 168 hours in a
territory forming one river basin shall be
considered one "Occurrence." The term "river
basin" shall mean the land drained by a river,
including all the tributaries of such river, which
flows directly into an ocean, sound, bay gulf, or
into one of the Great Lakes.
5. As regards "Freeze," only individual losses
directly caused by falling trees or limbs,
collapse, breakage of glass, power outage (off
premises), automobile physical damage
(comprehensive only) and water damage (caused by
ice damming or by bursting of frozen pipes and
tanks) may be included in the Company's
"Occurrence".
B. For all "Occurrences" the Company may choose the date
and time when any such period of consecutive hours
commences provided that it is not earlier than the date
and time of the occurrence of the first recorded
individual loss sustained by the Company arising out of
that disaster, accident or loss and provided that only
one such period of 168 consecutive hours shall apply
with respect to one event, except for those
"Occurrences" referred to in subparagraphs 1. and 2.
above where only one such period of 72 consecutive hours
shall apply with respect to one event, regardless of the
duration of the event.
C. No individual losses occasioned by an event that would
be covered by 72 hours clauses may be included in any
"Occurrence" claimed under the 168 hours provisions.
II. Property Definition of Risk
---------------------------
A. The Company shall be the sole judge of what constitutes one risk
provided:
1. One risk shall be defined from the standpoint of the peril of
fire, however, except as otherwise provided hereunder, a
building and its contents for a single insured shall never be
considered as constituting more than one risk, nor shall time
element coverages
-18-
be considered a separate risk apart from the building and its
contents, and
2. One risk, with respect to the peril of wind, including but not
limited to: tornado, cyclone, hurricane, windstorm and hail,
shall mean all insured locations listed on an individual
policy that are within a legal property boundary which is
owned, occupied or operated by the insured as one continuous
property site, including a site that contains roadways,
streams or rights-of-way intersecting the site.
3. The term "building" shall mean each separately roofed
structure enclosed within exterior walls.
4. As respects Dealer Open Lot risks, all insured property at any
one location shall be considered one risk.
III. Casualty Occurrence:
------------------------
A. The term "occurrence" as used herein means each accident or
occurrence or series of accidents or occurrences, arising out
of one event, provided that, as respects:
1. Products Liability (bodily injury and property
damage), the term "occurrence" shall mean the sum of
all damages arising from the consumption, use or
exposure to the insured's product(s) occurring during
each original policy period, in respect to each
insured, each policy, emanating from or traceable to
the same causative agency.
2. Third Party Bodily Injury or Property Damage
Liability, other than Automobile and Products,
arising or emanating from or traceable to a
continuous or repeated exposure to the same causative
agency, the term "occurrence" shall mean the sum of
all damages sustained by each insured, each policy,
during each original policy period.
B. The term "each original policy period" as used herein means
each annual period the original policy (i.e., the policy
reinsured hereunder) is in effect. Policies in effect for a
period greater than one year shall be deemed to have separate
annual policy periods.
C. If the date of loss, accident or occurrence cannot be
specifically determined, the date of loss, accident or
occurrence shall be the inception date of the original policy;
such policy period shall be deemed not to exceed 12 calendar
months.
-19-
IV. Terrorist Activity
------------------
A. "Terrorist Activity" shall mean any deliberate, unlawful act
that:
1. is declared by any authorized governmental official to be or
to involve terrorism, terrorist activity or acts of
terrorism; or
2. includes, involves, or is associated with the use or
threatened use of force, violence or harm against any
person, tangible or intangible property, the environment, or
any natural resources, where the act or threatened act is
intended, in whole or in part, to
(a) promote, further or express opposition to any political,
ideological, philosophical, racial, ethnic, social or
religious cause or objective; or
(b) influence, disrupt or interfere with any government
related operations, activities or policies; or
(c) intimidate, coerce or frighten the general public or any
segment of the general public; or
(d) disrupt or interfere with a national economy or any
segment of a national economy; or
3. includes, involves, or is associated with, in whole or in
part, any of the following activities, or the threat
thereof:
(a) hijacking or sabotage of any form of transportation or
conveyance, including but not limited to spacecraft,
satellite, aircraft, train, vessel, or motor vehicle;
(b) hostage taking or kidnapping;
(c) the use or threatened use of, or release or threatened
release of any nuclear, biological, chemical or
radioactive agent, material, device or weapon;
(d) the use of any bomb, incendiary device, explosive or
firearm;
(e) the interference with or disruption of basic public or
commercial services and systems, including but not
limited to the following services or systems:
electricity, natural gas, power, postal, communications,
telecommunications, information, public transportation,
water, fuel, sewer or waste disposal;
(f) the injuring or assassination of any elected or
appointed government official or any government
employee;
(g) the seizure, blockage, interference with, disruption of,
or damage to any government buildings, institutions,
functions, events, tangible or intangible property or
other assets; or
(h) the seizure, blockage, interference with, disruption of,
or damage to tunnels, roads, streets, highways, or other
places of public transportation or conveyance.
B. Any of the activities listed in section A(3) above shall be
considered Terrorist Activity except where the Company can
demonstrate to the Reinsurer that the foregoing activities or
threats thereof were motivated solely by personal objectives
of the perpetrator that are unrelated, in whole or in part, to
any intention to
1. promote, further or express opposition to any political,
ideological, philosophical, racial, ethnic, social or
religious cause or objective; or
-20-
2. influence, disrupt or interfere with any government
related operations, activities or policies; or
3. intimidate, coerce or frighten the general public or any
segment of the general public; or
4. disrupt or interfere with a national economy or any
segment of a national economy.
ARTICLE VIII
------------
CLAIMS
------
A. As a condition precedent to the Reinsurer's liability under
this Agreement, the Company shall give timely written notice
to the Reinsurer of all claims which may develop into losses
involving reinsurance hereunder.
B. In addition, the following categories of claims shall be
reported to the Reinsurer immediately, regardless of any
questions of liability of the insured or coverage under the
policy:
1. Fatality;
2. Partial or Total Paralysis;
3. Severe brain injury or brain damage prognosis;
4. Severe xxxxx;
5. Amputation of one or more limbs;
6. Loss of sight or hearing to a substantial degree;
7. Any injury where there is, or appears probable, an
alleged loss of earnings for one year or more; and,
8. Any claim with a loss reserve that exceeds 50% of the
Company's net retention, provided that such claim might
involve the Reinsurer.
C. The Company has the obligation to investigate and defend any
claim affecting this reinsurance, to advise the Reinsurer
promptly of subsequent developments pertaining thereto and to
pursue such claim to final determination.
D. It is understood that when so requested the Company will
afford the Reinsurer an opportunity to be associated with the
Company at the expense of the Reinsurer in the defense or
control of any claim or suit proceeding involving this
reinsurance; and the Company and the Reinsurer shall cooperate
in every respect in the defense of such suit or claim or
proceeding.
-21-
ARTICLE IX
----------
SUBROGATION AND SALVAGE
-----------------------
A. The Reinsurer shall be subrogated, as respects any loss for
which the Reinsurer shall actually pay or become liable, but
only to the extent of the amount of payment by or the amount
of liability to the Reinsurer, to all the rights of the
Company against any person or other entity who may be legally
responsible in damages for said loss. The Company hereby
agrees to enforce such rights, but in case the Company shall
refuse or neglect to do so the Reinsurer is hereby authorized
and empowered to bring any appropriate action in the name of
the Company or its policyholders, or otherwise to enforce such
rights.
B. Any recoveries, salvages or reimbursements applying to risks
covered under this Agreement shall always be used to reimburse
the excess carriers (from the last to the first, beginning
with the carrier of the last excess), according to their
participation, before being used in any way to reimburse the
Company for its primary loss.
C. All salvages, recoveries or reimbursements, after deduction of
expenses applicable thereto, recovered or received subsequent
to a loss settlement under this Agreement shall be applied as
if recovered or received prior to the aforesaid settlement and
all necessary adjustments shall be made by the parties hereto,
provided always, that nothing in this clause shall be
construed to mean that losses under this Agreement are not
recoverable until the Company's ultimate net loss has been
ascertained. Expenses hereunder shall exclude all office
expenses of the Company and all salaries and expenses of its
officials and employees except those of salaried adjusters.
ARTICLE X
-----------
TAXES
-----
The Company will be liable for all taxes on premiums reported to the Reinsurer
hereunder and will reimburse the Reinsurer for such taxes where the Reinsurer is
required to pay the same.
ARTICLE XI
-----------
ACCESS TO RECORDS
-----------------
The Company shall place at the disposal of the Reinsurer and the Reinsurer shall
have the right to inspect, through its authorized representatives, at all
reasonable times during the currency of this Agreement and thereafter, the
books, records and papers of the Company pertaining to the reinsurance provided
hereunder and all claims made in connection therewith.
-22-
ARTICLE XII
-----------
INSOLVENCY
----------
The reinsurance provided by this Agreement shall be payable by the Reinsurer
directly to the Company or to its liquidator, receiver or statutory successor on
the basis of the liability of the Company under the contract or contracts
reinsured. Subject to the right of offset and the verification of coverage, the
Reinsurer shall pay its share of the loss without diminution because of the
insolvency of the Company. In the event of the insolvency of the Company, the
liquidator, receiver or statutory successor of the Company shall give written
notice of the pendency of each claim against the Company on a policy or bond
reinsured within a reasonable time after such claim is filed in the insolvency
proceeding. During the pendency of such claim, the Reinsurer may, at its own
expense, investigate such claim and interpose in the proceeding where such claim
is to be adjudicated any defense or defenses which it may deem available to the
Company, its liquidator or receiver or statutory successor. Subject to court
approval, any expense thus incurred by the Reinsurer shall be chargeable against
the Company as part of the expense of liquidation to the extent of such
proportionate share of the benefit as shall accrue to the Company solely as a
result of the defense undertaken by the Reinsurer. The reinsurance shall be
payable as set forth above except where this Agreement specifically provides for
the payment of reinsurance proceeds to another party in the event of the
insolvency of the Company.
ARTICLE XIII
------------
OFFSET AND SECURITY
------------------
A. Each party hereto has the right, which may be exercised at any time,
to offset any amounts, whether on account of premiums or losses or
otherwise, due from such party to another party under this Agreement
or any other reinsurance agreement heretofore or hereafter entered
into between them, against any amounts, whether on account of
premiums or losses or otherwise due from the latter party to the
former party. The party asserting the right of offset may exercise
this right, whether as assuming or ceding insurer or in both roles
in the relevant agreement or agreements.
B. Each party hereby assigns and pledges to the other party (or to each
other party, if more than one) all of its rights under this
Agreement to receive premium or loss payments at any time from such
other party ("Collateral"), to secure its premium or loss
obligations to such other party at any time under this Agreement and
any other reinsurance agreement heretofore or hereinafter entered
into by and between them ("Secured Obligations"). If at any time a
party is in default under any Secured Obligation or shall be subject
to any liquidation, rehabilitation, reorganization or conservation
proceeding, each other party shall be entitled in its discretion, to
apply, or to withhold for the purpose of applying in due course, any
Collateral assigned and pledged to it by the former party and
otherwise to realize upon such Collateral as security for such
Secured Obligations.
-23-
C. The security interest described herein, and the term "Collateral,"
shall apply to all payments and other proceeds in respect of the
rights assigned and pledged. A party's security interest in
Collateral shall be deemed evidenced only by the counterpart of this
Agreement delivered to such party.
D. Each right under this Article is a separate and independent right,
exercisable, without notice or demand, alone or together with other
rights, in the sole election of the party entitled thereto, and no
waiver, delay, or failure to exercise, in respect of any right,
shall constitute a waiver of any other right. The provisions of this
Article shall survive any cancellation or other termination of this
Agreement.
ARTICLE XIV
-----------
ERRORS AND OMISSIONS
--------------------
The Reinsurer shall not be relieved of liability because of an error or
accidental omission by the Company in reporting any claim or loss or any
business reinsured under this Agreement, provided that the error or omission is
rectified promptly after discovery. The Reinsurer shall be obligated only for
the return of the premium paid for business reported but not reinsured under
this Agreement.
ARTICLE XV
----------
FEDERAL EXCESS RECOVERY
-----------------------
As respects the Insured Losses of the Insurer for each Program Year, it is
hereby agreed that to the extent the Insurer's total reinsurance recoverables
for Insured Losses, whether collected or not, combined with the financial
assistance available to the Insurer under the Act exceeds the aggregate amount
of Insured Losses paid by the Insurer, less any other recoveries or
reimbursements, such excess amounts (the "Excess Recovery") shall be allocated
to the Company. The allocation to the Company shall be deemed to be an amount
equal to the proportion that the Company's Insured Losses bear to the Insurer's
total Insured Losses for each Program Year. The Company shall then reimburse the
Reinsurer for its share of the Excess Recovery allocated to the Company. The
Reinsurer's share of the Excess Recovery shall be deemed to be an amount equal
to the proportion that the Reinsurer's payment of Insured Losses under this
Agreement bears to the Company's total collected reinsurance recoverables for
Insured Losses. The Company also agrees to provide the Reinsurer with all
necessary data respecting the transactions covered under this Clause.
"Act" as utilized herein shall mean the Terrorism Risk Insurance Act of 2002 and
any subsequent amendment thereof or any regulations promulgated there under.
"Insurer", "Insured Losses", and "Program Year" as utilized herein shall follow
the definitions as provided in the Act."
-24-
ARTICLE XVI
-----------
COMMENCEMENT AND TERMINATION
----------------------------
A. This Agreement shall take effect as of 12:01 a.m., Eastern Standard
Time, January 1, 2003, and shall, except as otherwise stipulated
herein or in any Exhibit hereto or any Endorsement hereof, continue
in full force and effect until terminated as hereinafter provided.
B. This Agreement may be canceled at any December 31, unless otherwise
mutually agreed by either party, giving 90 days notice in writing
prior to such date, stating to the other its desire to effect such
cancellation.
C. In the event of cancellation, the Company shall have the option to
terminate this Agreement on a cut-off or run-off basis as follows:
1. In the event the Company elects to cancel cut-off, the
Reinsurer shall remain liable for losses occurring prior to
such cancellation date, but all liability shall terminate
hereunder as to losses occurring subsequent to the
cancellation date.
2. In the event the Company elects to cancel run-off, the
Reinsurer shall remain liable for losses occurring prior to
such cancellation date, and any risk covered hereunder and in
effect as of said cancellation date shall remain in full force
until policy cancellation or natural expiration for a period
of time not to exceed twelve months.
D. Should this Agreement terminate while a covered loss occurrence is
in progress, the entire loss arising out of such loss occurrence
shall be subject to this Agreement.
E. Every notice of termination shall be given by certified letter
addressed to the intended recipient at such recipient's address as
hereinabove set forth. In determining whether the requisite number
of days' notice has been given in any case, the date of termination
shall be counted but the date of mailing shall not.
F. Notwithstanding the termination of this Agreement as hereinabove
provided, the provisions of this Agreement shall continue to apply
to all unfinished business hereunder to the end that all obligations
and liabilities incurred by each party hereunder prior to such
termination shall be fully performed and discharged.
-25-
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be executed
in duplicate in Hatboro, Pennsylvania, this day of , 2003;
ACCEPTED:
PENN-AMERICA INSURANCE COMPANY
PENN-STAR INSURANCE COMPANY
_______________________
and in Princeton, New Jersey, this day of 2003.
AMERICAN RE-INSURANCE COMPANY
_______________________
Vice President
DATED: March 18, 2003
-26-
No. 3154-0016
EXHIBIT A
EXHIBIT A
-----------
PROPERTY EXCESS OF LOSS
-----------------------
Section 1
---------
A. BUSINESS COVERED
----------------
The Reinsurer agrees to reimburse the Company, on an excess of loss
basis, for the amounts of ultimate net loss which the Company may pay
as a result of losses occurring on and after January 1, 2003, as
respects the Company's new and renewal policies becoming effective on
and after said date, covering the Classes of Insurance set forth below,
except as excluded under the EXCLUSIONS Article of this Agreement,
subject to the limitations set forth herein.
CLASSES OF INSURANCE
---------------------
Property
--------
Fire
Commercial Multi Peril Section I
Businessowners Section I
Allied Lines
Inland Marine
Automobile Physical Damage,
including Dealer's Open Lot
B. The term "policies" as used herein means each of the Company' s
binders, policies and contracts providing insurance and reinsurance
on the Classes of Insurance covered hereunder.
Section 2
---------
LIMITS OF COVER
---------------
A. As respects one or more than one of the classes under Property
Classes of Insurance as stated in Section 1, the Reinsurer shall not
be liable for any loss until the Company's ultimate net loss for
each and every risk exceeds $300,000 and then the Reinsurer shall be
liable for the amount of the Company' s ultimate net loss for each
and every risk in excess of $300,000 but the Reinsurer's liability
shall not exceed 100% of $1,700,000 for each and every risk or
exceed $3,000,000 in any one occurrence.
B. As respects Terrorist Activity as defined within the DEFINITIONS
Article, involving one or more than one of the classes under
Property Classes of Insurance as stated in Section 1, the Reinsurer
shall not be liable for any loss until the Company's ultimate net
loss for each and every risk exceeds $300,000 and then
-1-
the Reinsurer shall be liable for the amount of the Company' s
ultimate net loss for each and every risk in excess of $300,000 but
the Reinsurer's liability shall not exceed 100% of $1,700,000 for
each and every risk or exceed $3,000,000 in any one occurrence,
subject further to an annual aggregate limit of $3,000,000.
However, paragraph 3(c) of the Terrorist Activity definition as
defined in the DEFINITIONS Article, shall be excluded from recovery
hereunder for the following PROPERTY KEY URBAN CENTERS:
PROPERTY KEY URBAN CENTERS
----------------------------------- --------------------------------------
1. Atlanta, GA 2. Baltimore, MD
----------------------------------- --------------------------------------
3. Xxxxxx, XX 0. Xxxxxxxxx, XX
----------------------------------- --------------------------------------
5. Chicago, IL 6. Cincinnati, OH
----------------------------------- --------------------------------------
7. Cleveland, OH 8. Columbus, OH
----------------------------------- --------------------------------------
9. Dallas, TX 10. Denver, CO
----------------------------------- --------------------------------------
11. Detroit, MI 12. Fort Worth, TX
----------------------------------- --------------------------------------
13. Xxxxxxxx, XX 00. Xxxxxxx, XX
----------------------------------- --------------------------------------
15. Xxxxxx Xxxx XX xx XX 00. Xxx Xxxxx, XX
----------------------------------- --------------------------------------
17. Xxxx Xxxxx, XX 00. Xxx Xxxxxxx, XX
----------------------------------- --------------------------------------
19. Memphis, TN 20. Miami, FL
----------------------------------- --------------------------------------
21. Milwaukee, WI 22. Minneapolis, MN
----------------------------------- --------------------------------------
23. Xxx Xxxxxxx, XX 00. Xxx Xxxx, XX
----------------------------------- --------------------------------------
25. Oakland, CA 26. Philadelphia, PA
----------------------------------- --------------------------------------
27. Xxxxxxx, XX 00. Xxxxxxxxxx, XX
----------------------------------- --------------------------------------
29. Sacramento, CA 30. San Antonio, TX
----------------------------------- --------------------------------------
31. Xxx Xxxxx, XX 00. Xxx Xxxxxxxxx, XX
----------------------------------- --------------------------------------
33. Xxx Xxxx, XX 00. Xxxxxxx, XX
----------------------------------- --------------------------------------
35. St Louis, MO 36. Tuscon, AZ
----------------------------------- --------------------------------------
37. Washington, DC
----------------------------------- --------------------------------------
C. In the event of a combination loss involving a property risk and a
casualty occurrence loss from Exhibit B, the Company's retention
shall be the greater retention of the Line of Business applicable
but not to exceed to $500,000.
Section 3
-----------
REINSURANCE PREMIUM
-------------------
A. The premium for the reinsurance provided under this Exhibit shall be
computed at the rate of 14.64% of the Company's net written premium
for the new and renewal Property business covered as of January 1,
2003.
B. "Net written premium" shall mean the total of the Company's gross
premium written during the agreement year for the lines of business
covered hereunder, less expense constants on admitted policies, and
less return premiums and premiums paid for reinsurance, if any,
inuring to the benefit of the Agreement.
-2-
Section 4
-----------
COMMISSION
----------
The Reinsurer shall make a commission allowance of 37.50% to the Company on the
premiums ceded to this Agreement.
Section 5
-----------
REPORTS AND REMITTANCES
-----------------------
A. The Company will provide the Reinsurer with all necessary data
respecting premiums and forward it to the Reinsurer within 45 days
after the close of each quarter, on forms mutually acceptable.
B. Any balance due the Reinsurer, shall be remitted by the Company with
the Account Current. The Reinsurer shall remit any balance due the
Company promptly upon the Reinsurer's receipt of the Account
Current.
C. Payment by the Reinsurer of its portion of loss and loss expenses
paid by the Company will be made by the Reinsurer to the Company
within 5 days after proof of payment by the Company is received by
the Reinsurer.
This Exhibit A is attached to and forms part of Reinsurance Agreement No.
3154-0016 issued to PENN-AMERICA INSURANCE COMPANY, PENN-STAR INSURANCE COMPANY
DATED: March 18, 2003
-3-
No. 3154-0016
EXHIBIT B
EXHIBIT B
---------
CASUALTY EXCESS OF LOSS
-----------------------
Section 1
----------
A. BUSINESS COVERED
----------------
The Reinsurer agrees to reimburse the Company, on an excess of loss
basis, for the amounts of ultimate net loss which the Company may pay
as a result of losses occurring on and after January 1, 2003, as
respects the Company's new and renewal policies becoming effective on
and after said date, covering the Classes of Insurance set forth below,
except as excluded under the EXCLUSIONS Article of this Agreement,
subject to the limitations set forth herein.
CLASSES OF INSURANCE
--------------------
Casualty
--------
General Liability
Commercial Multi Peril Section II
Businessowners Section II
Employer's Liability Stop Gap coverage
Non-owned and Hired Automobile Liability when
written as part of Commercial Multi Peril Section
II or General Liability policies.
B. The term "policies" as used herein means each of the Company' s
binders, policies and contracts providing insurance and reinsurance
on the Classes of Insurance covered hereunder.
Section 2
---------
LIMITS OF COVER
---------------
A. As respects one or more than one of the classes under Casualty
Classes of Insurance as stated in Section 1, the Reinsurer shall not
be liable for any loss until the Company's ultimate net loss in each
occurrence exceeds $500,000 and then the Reinsurer shall be liable
for the amount of the Company' s ultimate net loss in each
occurrence in excess of $500,000 but the Reinsurer's liability shall
not exceed 100% of $2,500,000 in any one occurrence.
B. As respects Terrorist Activity as defined within the DEFINITIONS
Article, involving one or more than one of the classes under
Casualty Classes of Insurance as stated in Section 1, the Reinsurer
shall not be liable for any loss until the Company's ultimate net
loss in each occurrence exceeds $500,000 and then the Reinsurer
shall be liable for the amount of the Company' s ultimate net loss
in
-1-
each occurrence in excess of $500,000 but the Reinsurer's liability
shall not exceed 100% of $2,500,000 in any one occurrence, subject
further to an annual aggregate limit of $2,500,000.
C. In the event of a combination loss involving a property risk from
Exhibit A and a casualty occurrence, the Company's retention shall
be the greater retention of the Line of Business applicable but not
to exceed to $500,000.
Section 3
---------
REINSURANCE PREMIUM
--------------------
A. The premium for the reinsurance provided under this Exhibit shall be
computed at the rate of 12.29% of the Company's net written premium
for the new and reneal Casualty business covered as of January 1,
2003.
B. "Net written premium" shall mean the total of the Company's gross
premium written during the agreement year for the lines of business
covered hereunder, less expense constants on admitted policies, and
less return premiums and premiums paid for reinsurance, if any,
inuring to the benefit of the Agreement.
Section 4
-----------
COMMISSION
----------
The Reinsurer shall make a commission allowance of 37.50% to the Company on
the premiums ceded to this Agreement.
Section 5
-----------
REPORTS AND REMITTANCES
-----------------------
A. The Company will provide the Reinsurer with all necessary data
respecting premiums and forward it to the Reinsurer within 45 days
after the close of each quarter, on forms mutually acceptable.
B. Any balance due the Reinsurer, shall be remitted by the Company with
the Account Current. The Reinsurer shall remit any balance due the
Company promptly upon the Reinsurer's receipt of the Account
Current.
C. Payment by the Reinsurer of its portion of loss and loss expenses
paid by the Company will be made by the Reinsurer to the Company
within 5 days after proof of payment by the Company is received by
the Reinsurer.
-2-
Section 6
-----------
WARRANTY
--------
The maximum limits of liability for any one policy of the Company shall be
deemed not to exceed the following:
1. General Liability - $1,000,000 each occurrence and $2,000,000 general
aggregate. a) As respects Products and Completed Operations - $1,000,000 in
the aggregate.
2. Liquor Liability Coverage - $1,000,000 each occurrence (i.e., new and
renewal Restaurant policies, excluding Bars and Taverns, for the A, B, and
C states as per attached Appendix A, having liquor receipts of 40% or less
of total sales, effective on or after the effective date of this
Agreement).
This Exhibit B is attached to and forms part of Reinsurance Agreement No.
3154-0116 issued to PENN-AMERICA INSURANCE COMPANY, PENN-STAR INSURANCE COMPANY
DATED: March 18, 0000
-0-
XXXXXXXX A
----------
Class A Class B Class C
------- -------- --------
Delaware Arkansas Arizona
Kansas California Georgia
Maryland Colorado Idaho
Nebraska Connecticut Indiana
Nevada Florida Iowa
South Carolina Illinois Maine
Xxxxxxx Kentucky Michigan
Louisiana Mississippi
South Dakota Montana
Tennessee New Mexico
Utah North Dakota
Wisconsin Ohio
Oklahoma
Oregon
Washington
Wyoming
-1-
NUCLEAR INCIDENT EXCLUSION CLAUSE--
PHYSICAL DAMAGE--REINSURANCE--NO. 2
(1) This Reinsurance does not cover any loss or liability accruing to the
Reassured, directly or indirectly and whether as Insurer or Reinsurer,
from any Pool of Insurers or Reinsurers formed for the purpose of
covering Atomic or Nuclear Energy risks.
(2) Without in any way restricting the operation of paragraph (1) of this
Clause, this Reinsurance does not cover any loss or liability accruing
to the Reassured, directly or indirectly and whether as Insurer or
Reinsurer, from any insurance against Physical Damage (including
business interruption or consequential loss arising out of such
Physical Damage) to:
I. Nuclear reactor power plants including all auxiliary property
on the site, or
II. Any other nuclear reactor installation, including laboratories
handling radioactive materials in connection with reactor
installations, and "critical facilities" as such, or
III. Installations for fabricating complete fuel elements or for
processing substantial quantities of "special nuclear
material," and for reprocessing, salvaging, chemically
separating, storing or disposing of "spent" nuclear fuel or
waste materials, or
IV. Installations other than those listed in paragraph (2) III
above using substantial quantities of radioactive isotopes or
other products of nuclear fission.
(3) Without in any way restricting the operations of paragraphs (1) and (2)
hereof, this Reinsurance does not cover any loss or liability by
radioactive contamination accruing to the Reassured, directly or
indirectly, and whether as Insurer or Reinsurer, from any insurance on
property which is on the same site as a nuclear reactor power plant or
other nuclear installation and which normally would be insured
therewith except that this paragraph (3) shall not operate:
(a) where Reassured does not have knowledge of such nuclear reactor
power plant or nuclear installation, or
(b) where said insurance contains a provision excluding coverage for
damage to property caused by or resulting from radioactive
contamination, however caused. However on and after 1st January 1960
this sub-paragraph (b) shall only apply provided the said radioactive
contamination exclusion provision has been approved by the Governmental
Authority having jurisdiction thereof.
(4) Without in any way restricting the operations of paragraphs (1), (2)
and (3) hereof, this Reinsurance does not cover any loss or liability by
radioactive contamination accruing to the Reassured, directly or indirectly, and
whether as Insurer or Reinsurer, when such radioactive contamination is a named
hazard specifically insured against.
(5) It is understood and agreed that this Clause shall not extend to risks
using radioactive isotopes in any form where the nuclear exposure is not
considered by the Reassured to be the primary hazard.
(6) The term "special nuclear material" shall have the meaning given it in
the Atomic Energy Act of 1954 or by any law amendatory thereof.
(7) Reassured to be sole judge of what constitutes:
(a) substantial quantities, and
(b) the extent of installation, plant or site.
-1-
Note.--Without in any way restricting the operation of paragraph (1)
hereof, it is understood and agreed that:
(a) all policies issued by the Reassured on or before 31st December 1957 shall
be free from the application of the other provisions of this Clause until
expiry date or 31st December 1960 whichever first occurs whereupon all the
provisions of this Clause shall apply,
(b) With respect to any risk located in Canada policies issued by the
Reassured on or before 31st December 1958 shall be free from the
application of the other provisions of this Clause until expiry date or
31st December 1960 whichever first occurs whereupon all the provisions of
this Clause shall apply.
-2-
NUCLEAR INCIDENT EXCLUSION CLAUSE - LIABILITY - REINSURANCE -No. 1B
(1) This reinsurance does not cover any loss or liability accruing to the
Reassured as a member of, or subscriber to, any association of insurers or
reinsurer formed for the purpose of covering nuclear energy risks or as a direct
or indirect reinsurer of any such member, subscriber or association.
(2) Without in any way restricting the operation of paragraph (1) of this
Clause it is understood and agreed that for all purposes of this reinsurance all
the original policies of the Reassured (new, renewal and replacement) of the
classes specified in Clause II of this paragraph (2) from the time specified in
Clause III in this paragraph (2) shall be deemed to include the following
provision (specified as the Limited Exclusion Provision):
Limited Exclusion Provision.*
I. It is agreed that the policy does not apply under any liability
coverage,
to { injury, sickness, disease, death or destruction
bodily injury or property damage
with respect to which an insured under the policy is also an insured
under a nuclear energy liability policy issued by Nuclear Energy
Liability Insurance Association, Mutual Atomic Energy Liability
Underwriters or Nuclear Insurance Association of Canada, or would be
an insured under any such policy for its termination upon exhaustion
of its limit of liability.
II. Family Automobile Policies (liability only), Special Automobile
Policies (private passenger automobiles, liability only), Farmers
Comprehensive Personal Liability Policies (liability only),
Comprehensive Personal Liability Policies (liability only) or
policies of similar nature; and the liability portion of combination
forms related to the four classes of policies stated above, such as
the Comprehensive Dwelling Policy and the applicable types of
Homeowners Policies.
III.The inception dates and thereafter of all original policies as
described in II above, whether new, renewal or replacement, being
policies which either
(a) become effective on or after 1st May, 1960, or
(b) become effective before that date and contain the Limited
Exclusion Provision set out above;
provided this paragraph (2) shall not be applicable to Family
Automobile Policies, Special Automobile Policies, or policies or
combination policies of a similar nature, issued by the Reassured on
New York risks, until 90 days following approval of the Limited
Exclusion Provision by the Governmental Authority having jurisdiction
thereof.
(3) Except for those classes of policies specified in Clause II of
paragraph (2) and without in any way restricting the operation of paragraph (1)
of this Clause, it is understood and agreed that for all purposes of this
reinsurance the original liability policies of the Reassured (new, renewal and
replacement) affording the following coverages:
Owners, Landlords and Tenants Liability, Contractual Liability,
Elevator Liability, Owners or Contractors (including railroad)
Protective Liability, Manufacturers and Contractors Liability,
Product Liability, Professional and Malpractice Liability,
Storekeepers Liability, Garage Liability, Automobile Liability
(including Massachusetts Motor Vehicle or Garage Liability)
shall be deemed to include, with respect to such coverages, from the time
specified in Clause V of this paragraph (3), the following provision (specified
as the Broad Exclusion Provision):
Broad Exclusion Provision.*
It is agreed that the policy does not apply:
I. Under any Liability Coverage, { Injury, sickness, disease, death or
destruction to Bodily injury or
property damage
(a) with respect to which an insured under the policy is also an
insured under a nuclear energy liability policy issued by
Nuclear Energy Liability Insurance Association, Mutual
Atomic Energy Liability Underwriters or Nuclear Insurance
Association of Canada, or would be an insured under any such
policy but for its termination upon exhaustion of its limit
of liability; or
-1-
(b) resulting from the hazardous properties of nuclear material
and with respect to which (1) any person or organization is
required to maintain financial protection pursuant to the
Atomic Energy Act of 1954, or any law amendatory thereof, or
(2) the insured is, or had this policy not been issued would
be, entitled to indemnity from the United States of America,
or any agency thereof, under any agreement entered into by
the United States of America, or any agency thereof, with
any person or organization.
II.Under any Medical Payments Coverage, or under any Supplementary
Payments Provision relating
to { immediate medical or surgical relief, to expenses incurred with respect
first aid,
to bodily injury, sickness, disease or death resulting from the hazardous
of bodily injury properties
nuclear material and arising out of the operation of nuclear facility by any
person or
organization.
III. Under any Liability Coverage, to { Injury, sickness, disease, death
or destruction Bodily injury or property damage
resulting from the hazardous properties of nuclear material, if
(a) the nuclear material (1) is at any nuclear facility
owned by, or operated by or on behalf of, an insured or
(2) has been discharged or dispersed therefrom;
(b) the nuclear material is contained in spent fuel or waste
at any time possessed, handled, used, processed, stored,
transported or disposed of by or on behalf of an
insured; or
(c) the { injury, sickness, disease, death or destruction
bodily injury or property damage
arises out of the furnishing by an insured of services,
materials, parts or equipment in connection with the
planning, construction, maintenance, operation or use of any
nuclear facility, but if such facility is located within the
United States of America, its territories, or possessions or
Canada, this exclusion (c) applies only to
{ injury to or destruction of property at such nuclear facility.
property damage to such nuclear facility and any property thereat.
IV. As used in this endorsement:
"hazardous properties" include radioactive, toxic or explosive
properties; "nuclear materials" means source material, special nuclear
material or byproduct material; "source material," "special nuclear
material," "byproduct material" have the meanings given them in the
Atomic Energy Act of 1954 or in any law amendatory thereof; "spent
fuel" means any fuel element or fuel component, solid or liquid, which
has been used or exposed to radiation in a nuclear reactor; "waste"
means any waste material (1) containing byproduct material other than
the tailings or wastes produced by the extraction or concentration of
uranium or thorium from any ore processed primarily for its source
material content and (2) resulting from the operation by any person or
organization of any nuclear facility included within the definition of
nuclear facility under paragraph (a) or (b) thereof; "nuclear facility"
means
(a) any nuclear reactor,
(b) any equipment or device designed or used for (1) separating
the isotopes of uranium or plutonium, (2) processing or
utilizing spent fuel, or (3) handling, processing or
packaging waste,
(c) any equipment or device used for the processing, fabricating
or alloying of special nuclear material if at any time the
total amount of such material in the custody of the insured
at the premises where such equipment or device is located
consists of or contains more than 25 grams of plutonium or
uranium 233 or any combination thereof, or more than 250
grams of uranium 235,
(d) any structure, basin, excavation, premises or place prepared
or used for the storage or disposal of waste,
-2-
and includes the site on which any of the foregoing is located, all
operations conducted on such site and all premises used for such
operations; "nuclear reactor" means any apparatus designed or used to
sustain nuclear fission in a self-supporting chain reaction or to
contain a xxxxxxxx xxxx of fissionable material; With respect to injury
to or destruction of property, the word "injury" or "destruction"
includes all forms of radioactive contamination of property. "Property
damage" includes all forms of radioactive contamination of property.
V. The inception dates and thereafter of all original policies affording
coverages specified in this paragraph (3), whether new, renewal or
replacement, being policies which become effective on or after 1st May,
1960, provided this paragraph (3) shall not be applicable to
(i) Garage and Automobile Policies issued by the Reassured on
New York risks, or
(ii)statutory liability insurance required under Chapter 90,
General Laws of Massachusetts,
until 90 days following approval of the Broad Exclusion Provision by
the Governmental Authority having jurisdiction thereof.
(4) Without in any way restricting the operation of paragraph (1) of this
Clause, it is understood and agreed that paragraphs (2) and (3) above are not
applicable to original liability policies of the Reassured in Canada and that
with respect to such policies this Clause shall be deemed to include the Nuclear
Energy Liability Exclusion Provisions adopted by the Canadian Underwriters'
Association or the Independent Insurance Conference of Canada.
--------------------------------------------------------------------------------
* NOTE: The words printed in italics in the Limited Exclusion Provision and
in the Broad Exclusion Provision shall apply only in relation to original
liability policies which include a Limited Exclusion Provision or a Broad
Exclusion Provision containing those words.
-3-
NUCLEAR INCIDENT EXCLUSION CLAUSE - PHYSICAL DAMAGE AND LIABILITY
(BOILER AND MACHINERY POLICIES) - REINSURANCE - No. 3
(1) This reinsurance does not cover any loss or liability accruing to
the Reassured as a member of, or subscriber to, any association of insurers or
reinsurers formed for the purpose of covering nuclear energy risks or as a
direct or indirect reinsurer of any such member, subscriber or association.
(2) Without in any way restricting the operation of paragraph (1) of
this Clause it is understood and agreed that for all purposes of this
reinsurance all original Boiler and Machinery Insurance contracts of the
Reassured (new, renewal and replacement) shall be deemed to include the
following provisions of this paragraph.
This Policy does not apply to "loss," whether it be direct or
indirect, proximate or remote
(a) from an Accident caused directly or indirectly by nuclear
reaction, nuclear radiation or radioactive contamination,
all whether controlled or uncontrolled; or
(b) from nuclear reaction, nuclear radiation or radioactive
contamination, all whether controlled or uncontrolled,
caused directly or indirectly by, contributed to or
aggravated by an Accident.
(3) However, it is agreed that loss arising out of the use of
Radioactive Isotopes in any form is not hereby excluded from reinsurance
protection.
(4) Without in any way restricting the operation of paragraph (1)
hereof, it is understood and agreed that
(a) all policies issued by the Reassured to become effective
on or before 30th April, 1958, shall be free from the
application of the other provisions of this Clause until
expiry date or 30th April, 1961, whichever first occurs,
whereupon all the provisions of this Clause shall apply,
(b) with respect to any risk located in Canada policies issued
by the Reassured to become effective on or before 31st
December, 1958, shall be free from the application of the
other provisions of this Clause until expiry date or 31st
December, 1960, whichever first occurs, whereupon all the
provisions of this Clause shall apply.
No. 3154-0016
To get your agency production figures, visit xxx.xxxx-xxxx.xxx
-----------------
Visit our website at xxx.xxxx-xxxxxxx.xxx
--------------------
PA-2001-26
November 7, 2001
TO OUR AGENTS
NEW CONTRACTOR CLASSES,
CONTRACTOR APPLICATION, AND
EXCLUSIONARY ENDORSEMENT
I. Introduction
We have listened to your ideas, investigated the market, and
developed the following guidelines for writing contractors in your
states:
II. Contracting Guidelines
A. Contractor Classes: While construction defect claims and litigation
continue to arise, there are states where we think that this type of
business can still be written profitably - assuming the right mix of legal
atmosphere in the state and careful underwriting and monitoring.
(1) Contractor Classes - See the attached "Contracting Risks: Underwriting
Guidelines", which we ask that you implement immediately. You can
insert these guidelines in your Penn-America Agency Manual at either
Section 3, "Classification Authority Table", or Section 10,
"Underwriting Position Papers - Contracting Risks".
(2) You can start writing these new classes in the surplus lines company
in your state(s).
(3) In California and Pennsylvania, you must write these new classes in
Penn-America Insurance Company as we have no surplus lines carrier in
these states.
(4) In the "High Hazard" states (i.e., Arizona, California, Colorado,
Nevada, Oregon, Texas, Washington, and New York - as defined in the
attached Guidelines), you can write the following three classes -
Fence Erection Contractors, Painting Contractors and Water Main
Connection Construction. The classes available in the "Low Hazard"
states are listed in the attached Guidelines.
B. New Contractor Application - PA01-416 (11/01):
(1) The insured must complete and sign this application for all contractor
risks authorized in your state(s).
(2) Please begin using this application immediately.
(3) See attached application.
(4) You should insert this form in numerical order in your Forms
Portfolio, Section 6, "PA-Series Sample Forms".
C. New Exclusionary Endorsement - Condominium, Townhouse, Row
House or Tract Home Construction Project Exclusion - S2070
(11/01):
(1) Attach to all contractor classes on a non-admitted basis.
(2) Please begin using this exclusionary endorsement immediately on
non-admitted business. We are commencing a filings campaign and will
advise you of the approval of such filings for use on admitted
business as approvals occur. This exclusion should be attached to all
contractor risks no later than January 1, 2002.
(3) See attached exclusion.
(4) You should insert this form in numerical order in your Forms
Portfolio, Section 7, "S-Series Sample Forms".
III. EZ Rater - We are almost finished with the loading and publication of EZ
Raters for your use in rating new and renewal business. The EZ Raters will
include the new contractor classes attached to this Penn-Amerigram. You
should receive your copy of the EZ Raters on or about December 1st. In the
meantime, you can rate these risks using current ISO loss costs and our
loss cost multipliers published in your State.
IV. Future Developments - We will add the new Contractor Guidelines, the
Contractor Application and the new exclusionary endorsement to the next
Agency Manual change.
V. Questions/Comments
A. If you have any underwriting, coverage or product questions, please
contact your underwriter.
B. To receive a block of pre-assigned PAC policy numbers, contact: Xxxxxx
XxXxxxx by phone: (000) 000-0000, fax: (800) --- 000-0000, or email:
xxxxxxx@xxxx-xxxxxxx.xxx.
C. For support in updating your electronic forms libraries (FormMaker and
others), contact your Senior Analyst - Marketing and Communications
Technology:
Xxxxx Xxxxxxx phone: 000-000-0000 xxxxxxx@xxxx-xxxxxxx.xxx
Xxxxx Xxxxx phone: 000-000-0000 xxxxx@xxxx-xxxxxxx.xxx
-------------------------------
Xxxxxx X. Xxxxxx, Xx.
Vice President - Underwriting
CONTRACTING RISKS - UNDERWRITING GUIDELINES
A. LINE OF BUSINESS
----------------
General Liability
o Premises/Operations
o Products/Completed Operations
B. STATE GRADES
------------
We have assigned a grade of High Hazard (HH) or Low Hazard (LH) to each state.
In those states where we know the legal climate promotes construction defect
claims, we have assigned a grade of HH.
The High Hazard states are:
-------------------------- ----------------------- ----------------------
Arizona Nevada Washington
-------------------------- ----------------------- ----------------------
California Oregon New York
-------------------------- ----------------------- ----------------------
Colorado Texas
-------------------------- ----------------------- ----------------------
All other states are "Low Hazard". We will now write contractors subject to the
guidelines that follow.
C. ELIGIBLE CLASSES
----------------
You may bind contractors as shown on the two tables attached:
o "Eligible E-Z Rater Artisan-Contractors Classes - `Low' Hazard States"
o "Eligible and Prohibited Contractors Classes - `High' Hazard States"
D. LIMITS OF INSURANCE
-------------------
Under the General Liability Program, you can bind up to $1 million each
occurrence, $2 million general aggregate and $2 million products aggregate.
Under the Umbrella Program, you can bind up to $2 million each occurrence, $2
million general aggregate and $2 million products aggregate.
Under the Increased Limits Program, you can bind up to $3 million each
occurrence, $3 million general aggregate and $3 million products aggregate.
Maximum binding authority limits of all coverage layers written with
Penn-America - primary, excess (including our Increased General Liability Limits
Program) and umbrella - cannot exceed $3 million per occurrence/$3 million
general aggregate.
E. PROPERTY DAMAGE LIABILITY DEDUCTIBLE
------------------------------------
Minimum deductible is $500 per occurrence.
1
F. UNDERWRITING ELIGIBILITY
------------------------
o For contractors who do framing: no more than five homes per year. o
Maximum sales cannot exceed $1 million per year. o Contractors cannot
subcontract out more than 25% of their work. o Contractors performing
commercial jobs.
o Contractors performing work on custom-built homes or "spec" homes
(built without a contracted buyer). o Contractor must have a minimum
of three years in business or three years experience in the trade
being insured.
G. SUBMIT TO BINDING UNIT
----------------------
o Contractors with sales over $1 million.
o Contractors with annual premium (at "manual") over $15,000 and up to
$25,000.
o Contractors with two or more losses in the last three years, or one
loss over $5,000 in the last three years.
o New ventures with less than three years experience in the trade being
insured.
o Risks working on buildings over three stories. o Any exception to the
program guidelines.
H. SUBMIT TO SUBMIT UNIT
---------------------
o All contractor classes identified as "SS" in Section 3 -
Classification Authority Table - of the Agency Manual (and also on the
attached lists).
o Contractors with annual premium (at "manual") over $25,000.
I. PROHIBITED
----------
o All contractor classes identified as "P" in Section 3 - Classification
Authority Table - of the Agency Manual (and also on the attached
lists).
o New ventures with no prior experience.
o Construction Managers, Executive Supervisors, Paper Contractors and
Real Estate Developers.
o Carpenters framing-up more than five homes per year.
o Contractors with sales in excess of $2.5 million.
o Contractors working on condominium, townhouse, row house or tract home
projects.
o Contractors who subcontract out more than 25% of their work.
o Requests to show a general contractor as additional insured, when the
project is a condominium, townhouse, row house or tract home project.
o Requests for Blanket Additional Insured Endorsement.
2
J. BINDING AUTHORITY - UNDERWRITING REQUIREMENTS
---------------------------------------------
o All new policies must be written in the Surplus Lines (non-admitted)
carrier approved in your state. Check your State Exception Pages for
the surplus lines company in your state.
o Use the same policy number on renewal.
o Premiums are "minimum and deposit" with a 50% minimum earned on
cancellation, 100% earned on audit (attach S1003, Minimum and
Deposit).
o Insured must complete and sign a Penn-America Contractors'
Application. See attached Contractor Application Form [PA01-416
(11/01)].
o Order inspection reports on all accounts (except for one-man
operations). We must receive them within 45 says of inception.
o We will audit all contractors annually to verify sales, payroll,
classes and exposures.
o All requests for "additional insured" (AI) endorsements must be
documented, defining the relationship of the AI to the named insured
and the particular job being performed. Review all AI requests before
adding them to the policy. Use Additional Insured - Owners, Lessees or
Contractors - Scheduled Person or Organization, CG 20 10 03 97 - do
not use an earlier edition date.
o Any amendment in the wording on an AI endorsement must be submitted
and approved by us in advance.
o Submit in advance any requests for amendment of wording on
Certificates of Insurance.
o Get certificates of insurance verifying equal limits to our policy
from all subcontractors. Our insured should be added as an additional
insured on any subcontractor's policy.
K. PRICING
-------
Use the rates published in the Surplus Lines E-Z Rater as the minimum rate. For
those contractors classes not listed in the E-Z Rater, use current ISO loss
costs and our published Loss Cost Multiplier for our Surplus Lines carrier.
If otherwise acceptable, risks with prior losses (one loss up to $5,000
incurred) are to be surcharged a minimum of 10%.
3
L. REQUIRED FORMS AND ENDORSEMENTS
-------------------------------
CG0057 Amendment of Insuring Agreement - Known Injury or Damage
S2006 Independent Contractors Conditional Endorsement
S2041 Classification Limitation Endorsement
S2047 Exclusion - Property Damage Claims in Progress
S2066 Exclusion - Injury to Employee or Independent Contractor
S2067 Exclusion - EIFS Exclusion
S2068 Mold Exclusion
S2070 Exclusion - Tract Homes, Condominiums and Townhouses
M. PROHIBITED ENDORSEMENTS
-----------------------
CG2404 Waiver or Transfer of Rights of Recovery Against Others to Us
S2056 Blanket Additional Insured Endorsement
S2057 Additional Insured - Primary Coverage
4
ELIGIBLE AND PROHIBITED CONTRACTORS CLASSES - "HIGH" HAZARD STATES
( All Contractors Classes not listed are PROHIBITED also)
"High" Hazard States are:
--------------------------------------------------------------------------------
Arizona Nevada Texas
--------------------------------------------------------------------------------
California Oregon Washington
--------------------------------------------------------------------------------
Colorado New York
---------------------------------------------------------------
B=Binding Authority SB=Submit to Binding Authority Underwriter SS=Submit to edbmit Unit P=Prohibited
11/01/01 + = Products Included
Binding Authority
--------------------------
ISO Class CLASS DEFINITION Prem Prods Underwriting Comments
Code Ops
===============================================================================================================================
90089 ADVERTISING SIGN CO OUTDOOR B +
-------------------------------------------------------------------------------------------------------------------------------
91111 AIR CONDITIONING INSTAL/SERV/REP B B Yes
-------------------------------------------------------------------------------------------------------------------------------
91127 ALARM/ALARM SYSTEM INST/SERV/REPAIR B B Yes
-------------------------------------------------------------------------------------------------------------------------------
91135 ANALYTICAL CHEMISTS SS P
-------------------------------------------------------------------------------------------------------------------------------
91150 APPLIANCE/ACCESS-INST/SERV/REPR/COMM B SS
-------------------------------------------------------------------------------------------------------------------------------
91155 APPLIANCE/ACCESS INST/SERV/REPR HOUSE B B Yes
-------------------------------------------------------------------------------------------------------------------------------
91175 AUCTIONEER -LIVESTOCK AWAY FROM PREMISES SS +
-------------------------------------------------------------------------------------------------------------------------------
91177 AUCTIONEER SALES AWAY FROM PREMISE SS +
-------------------------------------------------------------------------------------------------------------------------------
91179 AUCTION-ON PREMISES OWN RENT INS B +
-------------------------------------------------------------------------------------------------------------------------------
91190 AUTOMOBILE DISMANTLING SS SS
-------------------------------------------------------------------------------------------------------------------------------
91200 BLACKSMITHING B +
-------------------------------------------------------------------------------------------------------------------------------
91315 CABLE/SUBSCRIPTION TV COMPANIES B +
-------------------------------------------------------------------------------------------------------------------------------
91340 CARPENTRY - RESIDENTIAL P P
-------------------------------------------------------------------------------------------------------------------------------
91341 CARPENTRY - INTERIOR P P
-------------------------------------------------------------------------------------------------------------------------------
91342 CARPENTRY, NOC P P
-------------------------------------------------------------------------------------------------------------------------------
91343 CARPENTRY - SHOP ONLY P P
-------------------------------------------------------------------------------------------------------------------------------
91405 CARPET RUG FURNITURE UPHOLSTERY CLEAN B + Yes
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
91436 CEILING OR WALL INSTALLATION - METAL B B Yes
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
91481 CHIMNEY CLEANING B + Yes
-------------------------------------------------------------------------------------------------------------------------------
91523 CLEANING - OUTSIDE SURFACE BLDG B B Yes
-------------------------------------------------------------------------------------------------------------------------------
91547 COMMISSARY WORK B +
-------------------------------------------------------------------------------------------------------------------------------
91551 COMMUNICATION EQUIPMENT INSTALL SS SS
-------------------------------------------------------------------------------------------------------------------------------
91555 COMPUTER SERVICE OR REPAIR B B Yes
-------------------------------------------------------------------------------------------------------------------------------
91560 CONCRETE CONSTRUCTION P P
-------------------------------------------------------------------------------------------------------------------------------
91577 CONDUIT CONSTRUCTION FOR CABLE B B
-------------------------------------------------------------------------------------------------------------------------------
94444 CONTRACTORS, NOC P P
-------------------------------------------------------------------------------------------------------------------------------
91580 CONTRACTORS, EXEC. SUPV. (GEN. CONTRS.) P P
-------------------------------------------------------------------------------------------------------------------------------
91583 CONTRACTORS - SUB-WORK, 1, 2 FAM DWGS B B
-------------------------------------------------------------------------------------------------------------------------------
91581 CONTRACTORS - SUB-WORK, XXX XXXXX X X
-------------------------------------------------------------------------------------------------------------------------------
00000 CONTRACTORS - SUB-WORK, INDUSTRIAL SS SS
-------------------------------------------------------------------------------------------------------------------------------
91585 CONTRACTORS - SUB-WORK, BUILDINGS B B Yes
-------------------------------------------------------------------------------------------------------------------------------
91589 CONTRACTORS STREET HWY CONSTRUCT SS SS
-------------------------------------------------------------------------------------------------------------------------------
91590 CONTRACTORS PERMANENT YARDS B +
-------------------------------------------------------------------------------------------------------------------------------
91629 DEBRIS REMOVAL, CONSTRUCTION SITE B B
-------------------------------------------------------------------------------------------------------------------------------
52134 DOOR OR WINDOW MANUFACTURING P P
-------------------------------------------------------------------------------------------------------------------------------
52315 DOOR OR WINDOW MFG - WOOD P P
-------------------------------------------------------------------------------------------------------------------------------
91746 DOOR OR WINDOW INSTALLATION (METAL) P P
-------------------------------------------------------------------------------------------------------------------------------
92102 DRILLING WATER SS SS
-------------------------------------------------------------------------------------------------------------------------------
92215 DRIVEWAY, PARKING LOT, SIDEWALK PAVING P P
-------------------------------------------------------------------------------------------------------------------------------
92338 DRY WALL OR WALL BOARD INSULATION P P
-------------------------------------------------------------------------------------------------------------------------------
92451 ELECTRICAL APPARATUS INSTALL, SVC. REP. B SS
-------------------------------------------------------------------------------------------------------------------------------
92478 ELECTRICAL WORK WITHIN BUILDING B B Yes
-------------------------------------------------------------------------------------------------------------------------------
92663 ENGINEERS & ARCHITECTS SS +
-------------------------------------------------------------------------------------------------------------------------------
94007 EXCAVATION P P
-------------------------------------------------------------------------------------------------------------------------------
94099 EXPRESS COMPANIES B +
-------------------------------------------------------------------------------------------------------------------------------
94276 FENCE ERECTION CONTRACTORS B B Yes
-------------------------------------------------------------------------------------------------------------------------------
94304 FIRE EXTINGUISHER SERV REFILL TESTING SS SS
-------------------------------------------------------------------------------------------------------------------------------
94381 FIRE SUPPRESSIONS SYSTEMS SS SS
-------------------------------------------------------------------------------------------------------------------------------
94569 FLOOR COVER INSTALLATION, NOT CERAMIC B B Yes
-------------------------------------------------------------------------------------------------------------------------------
94590 FLOOR WAXING B + Yes
-------------------------------------------------------------------------------------------------------------------------------
94617 FREIGHT FORWARDER, HANDLER NOC SS +
-------------------------------------------------------------------------------------------------------------------------------
95124 FURNITURE, FIXTURES INSTALL. (METAL, WOOD) B B
-------------------------------------------------------------------------------------------------------------------------------
95233 GARBAGE, ASH, REFUSE COLLECTING SS +
-------------------------------------------------------------------------------------------------------------------------------
13590 GLAZIERS & GLASS DEALERS P P
-------------------------------------------------------------------------------------------------------------------------------
95410 GRADING OF LAND P P
-------------------------------------------------------------------------------------------------------------------------------
95487 GREENHOUSE ERECTION B B
-------------------------------------------------------------------------------------------------------------------------------
95505 GUNITING OR SHOT-CRETE SS SS
-------------------------------------------------------------------------------------------------------------------------------
95625 HANDYMEN B B Yes
-------------------------------------------------------------------------------------------------------------------------------
95647 HEATING AIR/COND SYS EQUIP (NO LP GAS) B B Yes
-------------------------------------------------------------------------------------------------------------------------------
95648 HEATING AIR/CONDITIONING SYSTEM EQUIP SS SS
-------------------------------------------------------------------------------------------------------------------------------
96053 HOUSE FURNISHING INSTALLATION NOC B B Yes
-------------------------------------------------------------------------------------------------------------------------------
96317 INSPECTION APPRAISAL COS (VALUATION) SS +
-------------------------------------------------------------------------------------------------------------------------------
96410 INSULATION WORK - MINERAL SS SS
-------------------------------------------------------------------------------------------------------------------------------
96409 INSULATION WORK - PLASTIC OR ORGANIC (SOLID) SS SS
-------------------------------------------------------------------------------------------------------------------------------
96611 INTERIOR DECORATORS B B Yes
-------------------------------------------------------------------------------------------------------------------------------
96816 JANITORIAL SERVICES B + Yes
-------------------------------------------------------------------------------------------------------------------------------
97002 LABS, RESEARCH DEVELOP TEST PRF SS SS
-------------------------------------------------------------------------------------------------------------------------------
97003 LABS, RESEARCH DEVELOP TEST N/PRF SS SS
-------------------------------------------------------------------------------------------------------------------------------
97047 LANDSCAPE GARDENING B + Yes
-------------------------------------------------------------------------------------------------------------------------------
97050 LAWN CARE B + Yes
-------------------------------------------------------------------------------------------------------------------------------
97111 LOGGING AND LUMBERING SS +
-------------------------------------------------------------------------------------------------------------------------------
97220 MACHINE SHOPS NOC B SS
-------------------------------------------------------------------------------------------------------------------------------
97221 MACHINE EQUIPMENT FARM INSTALL ETC SS SS
-------------------------------------------------------------------------------------------------------------------------------
97222 MACHINE EQUIPMENT INDUSTRIAL SS SS
-------------------------------------------------------------------------------------------------------------------------------
97223 MACHINE EQUIPMENT INSTALL NOC SS SS
-------------------------------------------------------------------------------------------------------------------------------
97447 MASONRY P P
-------------------------------------------------------------------------------------------------------------------------------
97650 METAL ERECTION DECORATVE ARTIST B B Yes
-------------------------------------------------------------------------------------------------------------------------------
97651 METAL ERECTION - FRAME IRONWORK OUTSIDE P P
-------------------------------------------------------------------------------------------------------------------------------
97652 METAL ERECTION DWELLINGS UP TO 2 XXXX. P P
-------------------------------------------------------------------------------------------------------------------------------
97653 METAL ERECTION - NON-STRUCTURAL P P
-------------------------------------------------------------------------------------------------------------------------------
97655 METAL ERECTION - STRUCTURAL P P
-------------------------------------------------------------------------------------------------------------------------------
98090 MOTION PICTURE DEVELOP PRINTING B +
-------------------------------------------------------------------------------------------------------------------------------
98091 MOTION PICTURE DISTRIB EXCHANGE B +
-------------------------------------------------------------------------------------------------------------------------------
98111 OFFICE MACHINE APPLIANCE REPAIR B + Yes
-------------------------------------------------------------------------------------------------------------------------------
98257 ORCHARD VINEYARD RUN BY CONTRACTOR SS +
-------------------------------------------------------------------------------------------------------------------------------
98303 PAINTING EXTERIOR >3 STORIES SS SS
-------------------------------------------------------------------------------------------------------------------------------
98304 PAINTING EXTERIOR UP TO 3 STORIES B B Yes
-------------------------------------------------------------------------------------------------------------------------------
98305 PAINTING INTERIOR B B Yes
-------------------------------------------------------------------------------------------------------------------------------
98308 PAINTING SHOP ONLY B B Yes
-------------------------------------------------------------------------------------------------------------------------------
98344 PAPERHANGING B B Yes
-------------------------------------------------------------------------------------------------------------------------------
98405 PIANO TUNING B + Yes
-------------------------------------------------------------------------------------------------------------------------------
98449 PLASTERING OR STUCCO WORK P B
-------------------------------------------------------------------------------------------------------------------------------
98482 PLUMBING COMMERCIAL, INDUSTRIAL B B Yes
-------------------------------------------------------------------------------------------------------------------------------
98483 PLUMBING RESIDENTIAL, DOMESTIC P P
-------------------------------------------------------------------------------------------------------------------------------
98502 PREFAB BUILDING ERECTION P P
-------------------------------------------------------------------------------------------------------------------------------
98597 RADIO OR TV BROADCASTING PROFIT B +
-------------------------------------------------------------------------------------------------------------------------------
98598 RADIO TV BROADCASTING NOT PROF B +
-------------------------------------------------------------------------------------------------------------------------------
98636 REFRIGERATION SYSTEM EQUIP INSTALL ETC B B Yes
-------------------------------------------------------------------------------------------------------------------------------
98640 RENOVATING OUTSIDE SURFACES OF BLDGS B + Yes
-------------------------------------------------------------------------------------------------------------------------------
98658 RIGGING SS +
-------------------------------------------------------------------------------------------------------------------------------
98677 ROOFING - COMMERCIAL P P
-------------------------------------------------------------------------------------------------------------------------------
98678 ROOFING - RESIDENTIAL P P
-------------------------------------------------------------------------------------------------------------------------------
98698 SALVAGE OPERATIONS NOC SS SS
-------------------------------------------------------------------------------------------------------------------------------
98699 SALVAGE OPERATE REMOVAL ETC SS SS
-------------------------------------------------------------------------------------------------------------------------------
98705 SANDBLASTING SS +
-------------------------------------------------------------------------------------------------------------------------------
98710 SAND OR GRAVEL DIGGING SS +
-------------------------------------------------------------------------------------------------------------------------------
98805 SEPTIC TANK SYSTEMS CLEANING B B Yes
-------------------------------------------------------------------------------------------------------------------------------
98806 SEPTIC TANK SYSTEMS INSTAL, SVC. REP. B B
-------------------------------------------------------------------------------------------------------------------------------
98813 SEWER CLEANING SS SS
-------------------------------------------------------------------------------------------------------------------------------
98820 SEWER MAINS OR CONNECTIONS CONSTR. B B
-------------------------------------------------------------------------------------------------------------------------------
98884 SHEET METAL WORK - OUTSIDE P P
-------------------------------------------------------------------------------------------------------------------------------
98967 SIDING INSTALLATION P P
-------------------------------------------------------------------------------------------------------------------------------
98993 SIGN ERECTION INSTALL REPAIR B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99003 SIGN PAINTING, LETTERING INSIDE BLDG B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99004 SIGN PAINTING, LETTERING BLDG, STRUCTURE B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99303 SNOW REMOVAL, PARKING LOT & DRIVEWAY B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99321 STREET, ROAD PAVING REPAVING ETC. SS SS
-------------------------------------------------------------------------------------------------------------------------------
99471 SURVEYING - LAND (NO CONSTRUCTION) B B
-------------------------------------------------------------------------------------------------------------------------------
99505 SWIMMING POOL SERVICING B + Yes
-------------------------------------------------------------------------------------------------------------------------------
99506 SWIM POOL INSTALL SERV REPAIR SS +
-------------------------------------------------------------------------------------------------------------------------------
99507 SWIM POOL INSTALL SERV BELOW GR SS +
-------------------------------------------------------------------------------------------------------------------------------
99600 TELECOMMUNICATION SERVICE PROVIDER SS +
-------------------------------------------------------------------------------------------------------------------------------
99613 TELEPHONE/ CABLE TV LINE CONSTRUCTION B B
-------------------------------------------------------------------------------------------------------------------------------
99620 TELEPRODUCTION STUDIOS B +
-------------------------------------------------------------------------------------------------------------------------------
99650 TV RADIO RECEIVING SET INSTALLING B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99709 TENT OR CANVAS GOODS-ERECTION B B
-------------------------------------------------------------------------------------------------------------------------------
99718 THEATRICAL COMPANIES SS +
-------------------------------------------------------------------------------------------------------------------------------
99746 TILE, STONE, MARBLE, TERRAZO, MOSAIC WORK B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99777 TREE PRUNING, DUSTING, SPRAYING ETC B + Yes
-------------------------------------------------------------------------------------------------------------------------------
99793 TRUCKERS B +
-------------------------------------------------------------------------------------------------------------------------------
99826 UPHOLSTERING NOC B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99827 UPHOLSTERING SHOP ONLY B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99851 VETERINARIAN VETERINARY HOSP B +
-------------------------------------------------------------------------------------------------------------------------------
99917 WAREHOUSE COLD STORAGE PUBLIC B +
-------------------------------------------------------------------------------------------------------------------------------
99938 WAREHOUSES NOC B +
-------------------------------------------------------------------------------------------------------------------------------
99946 WATER MAIN CONNECTION CONSTRUCTION B B
-------------------------------------------------------------------------------------------------------------------------------
99948 WATER SOFTENING EQUIPMENT INSTALLING B B Yes
-------------------------------------------------------------------------------------------------------------------------------
99969 WELDING, CUTTING B SS
-------------------------------------------------------------------------------------------------------------------------------
99952 WATERPROOFING - PRESSURE APPARATUS B B
-------------------------------------------------------------------------------------------------------------------------------
99953 WATERPROOFING - TROWEL, EXTERIOR SS SS
-------------------------------------------------------------------------------------------------------------------------------
99954 WATERPROOFING - TROWEL, INTERIOR SS SS
-------------------------------------------------------------------------------------------------------------------------------
99955 WATERPROOFING, NOC B B
-------------------------------------------------------------------------------------------------------------------------------
99975 WINDOW CLEANING B + Yes
-------------------------------------------------------------------------------------------------------------------------------
91342 WINDOW INSTALLATION - WOOD (CARPENTRY) B B
-------------------------------------------------------------------------------------------------------------------------------
00000 XXXXXXXX XXXX XXXXXXXXXX XXX X +
-------------------------------------------------------------------------------------------------------------------------------
99987 WRECKING NOT EXCEED 3 STORIES B +
-------------------------------------------------------------------------------------------------------------------------------
ELIGIBLE AND PROHIBITED CONTRACTORS CLASSES - "LOW" HAZARD STATES
( All Contractors Classes not listed are PROHIBITED also)
B=Binding Authority SB=Submit to Binding Authority Underwriter SS=Submit to Submed Unit P=Prohibited
11/01/01 + = Products Included
Binding Authority
--------------------------
ISO Class CLASS DEFINITION Prem Prods E-Z Underwriting Comments
Code Ops Rater
====================================================================================================================================
90089 ADVERTISING SIGN CO OUTDOOR B +
------------------------------------------------------------------------------------------------------------------------------------
91111 AIR CONDITIONING INSTAL/SERV/REP B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91127 ALARM/ALARM SYSTEM INST/SERV/REPAIR B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91135 ANALYTICAL CHEMISTS SS P
------------------------------------------------------------------------------------------------------------------------------------
91150 APPLIANCE/ACCESS-INST/SERV/REPR/COMM B SS
------------------------------------------------------------------------------------------------------------------------------------
91155 APPLIANCE/ACCESS INST/SERV/REPR HOUSE B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91175 AUCTIONEER -LIVESTOCK AWAY FROM PREMISES SS +
------------------------------------------------------------------------------------------------------------------------------------
91177 AUCTIONEER SALES AWAY FROM PREMISE SB +
------------------------------------------------------------------------------------------------------------------------------------
91179 AUCTION-ON PREMISES OWN RENT INS B +
------------------------------------------------------------------------------------------------------------------------------------
91190 AUTOMOBILE DISMANTLING SS SS
------------------------------------------------------------------------------------------------------------------------------------
91200 BLACKSMITHING B +
------------------------------------------------------------------------------------------------------------------------------------
91315 CABLE/SUBSCRIPTION TV COMPANIES B +
------------------------------------------------------------------------------------------------------------------------------------
91340 CARPENTRY - RESIDENTIAL B B Yes Max # houses "framed":
5 per year
------------------------------------------------------------------------------------------------------------------------------------
91341 CARPENTRY - INTERIOR B B Yes Max # houses "framed":
5 per year
------------------------------------------------------------------------------------------------------------------------------------
91342 CARPENTRY, NOC B B Yes Max # houses "framed":
5 per year
------------------------------------------------------------------------------------------------------------------------------------
91343 CARPENTRY - SHOP ONLY B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91405 CARPET RUG FURNITURE UPHOLSTERY CLEAN B + Yes
------------------------------------------------------------------------------------------------------------------------------------
91436 CEILING OR WALL INSTALLATION - METAL B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91481 CHIMNEY CLEANING B + Yes
------------------------------------------------------------------------------------------------------------------------------------
91523 CLEANING - OUTSIDE SURFACE BLDG B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91547 COMMISSARY WORK B +
------------------------------------------------------------------------------------------------------------------------------------
91551 COMMUNICATION EQUIPMENT INSTALL SS SS
------------------------------------------------------------------------------------------------------------------------------------
91555 COMPUTER SERVICE OR REPAIR B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91560 CONCRETE CONSTRUCTION B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91577 CONDUIT CONSTRUCTION FOR CABLE B B
------------------------------------------------------------------------------------------------------------------------------------
94444 CONTRACTORS, NOC SS SS
------------------------------------------------------------------------------------------------------------------------------------
91580 CONTRACTORS, EXEC. SUPV. (GEN. CONTRS.) SS SS Residential Construction
Prohibited
------------------------------------------------------------------------------------------------------------------------------------
91583 CONTRACTORS - SUB-WORK, 1, 2 FAM DWGS B B
------------------------------------------------------------------------------------------------------------------------------------
91581 CONTRACTORS - SUB-WORK, XXX XXXXX X X
------------------------------------------------------------------------------------------------------------------------------------
00000 CONTRACTORS - SUB-WORK, INDUSTRIAL SS SS
------------------------------------------------------------------------------------------------------------------------------------
91585 CONTRACTORS - SUB-WORK, BUILDINGS B B Yes
------------------------------------------------------------------------------------------------------------------------------------
91589 CONTRACTORS STREET HWY CONSTRUCT SS SS
------------------------------------------------------------------------------------------------------------------------------------
91590 CONTRACTORS PERMANENT YARDS B +
------------------------------------------------------------------------------------------------------------------------------------
91629 DEBRIS REMOVAL, CONSTRUCTION SITE B B
------------------------------------------------------------------------------------------------------------------------------------
52134 DOOR OR WINDOW MANUFACTURING B B
------------------------------------------------------------------------------------------------------------------------------------
52315 DOOR OR WINDOW MFG - WOOD B B
------------------------------------------------------------------------------------------------------------------------------------
91746 DOOR OR WINDOW INSTALLATION (METAL) B B
------------------------------------------------------------------------------------------------------------------------------------
92102 DRILLING WATER SS SS
------------------------------------------------------------------------------------------------------------------------------------
92215 DRIVEWAY, PARKING LOT, SIDEWALK PAVING B B Yes
------------------------------------------------------------------------------------------------------------------------------------
92338 DRY WALL OR WALL BOARD INSULATION B B Yes
------------------------------------------------------------------------------------------------------------------------------------
92451 ELECTRICAL APPARATUS INSTALL, SVC. REP. B SS
------------------------------------------------------------------------------------------------------------------------------------
92478 ELECTRICAL WORK WITHIN BUILDING B B Yes
------------------------------------------------------------------------------------------------------------------------------------
92663 ENGINEERS & ARCHITECTS SS +
------------------------------------------------------------------------------------------------------------------------------------
94007 EXCAVATION B B Yes
------------------------------------------------------------------------------------------------------------------------------------
94099 EXPRESS COMPANIES B +
------------------------------------------------------------------------------------------------------------------------------------
94276 FENCE ERECTION CONTRACTORS B B Yes
------------------------------------------------------------------------------------------------------------------------------------
94304 FIRE EXTINGUISHER SERV REFILL TESTING SS SS
------------------------------------------------------------------------------------------------------------------------------------
94381 FIRE SUPPRESSIONS SYSTEMS SS SS
------------------------------------------------------------------------------------------------------------------------------------
94569 FLOOR COVER INSTALLATION, NOT CERAMIC B B Yes
------------------------------------------------------------------------------------------------------------------------------------
94590 FLOOR WAXING B + Yes
------------------------------------------------------------------------------------------------------------------------------------
94617 FREIGHT FORWARDER, HANDLER NOC SB +
------------------------------------------------------------------------------------------------------------------------------------
95124 FURNITURE, FIXTURES INSTALL. (METAL, WOOD) B B
------------------------------------------------------------------------------------------------------------------------------------
95233 GARBAGE, ASH, REFUSE COLLECTING SS +
------------------------------------------------------------------------------------------------------------------------------------
13590 GLAZIERS & GLASS DEALERS B B Yes
------------------------------------------------------------------------------------------------------------------------------------
95410 GRADING OF LAND B B Yes
------------------------------------------------------------------------------------------------------------------------------------
95487 GREENHOUSE ERECTION B B
------------------------------------------------------------------------------------------------------------------------------------
95505 GUNITING OR SHOT-CRETE SS SS
------------------------------------------------------------------------------------------------------------------------------------
95625 HANDYMEN B B Yes
------------------------------------------------------------------------------------------------------------------------------------
95647 HEATING AIR/COND SYS EQUIP (NO LP GAS) B B Yes
------------------------------------------------------------------------------------------------------------------------------------
95648 HEATING AIR/CONDITIONING SYSTEM EQUIP SS SS
------------------------------------------------------------------------------------------------------------------------------------
96053 HOUSE FURNISHING INSTALLATION NOC B B Yes
------------------------------------------------------------------------------------------------------------------------------------
96317 INSPECTION APPRAISAL COS (VALUATION) SS +
------------------------------------------------------------------------------------------------------------------------------------
96410 INSULATION WORK - MINERAL SS SS
------------------------------------------------------------------------------------------------------------------------------------
96409 INSULATION WORK - PLASTIC OR ORGANIC (SOLID) SS SS
------------------------------------------------------------------------------------------------------------------------------------
96611 INTERIOR DECORATORS B B Yes
------------------------------------------------------------------------------------------------------------------------------------
96816 JANITORIAL SERVICES B + Yes
------------------------------------------------------------------------------------------------------------------------------------
97002 LABS, RESEARCH DEVELOP TEST PRF SS SS
------------------------------------------------------------------------------------------------------------------------------------
97003 LABS, RESEARCH DEVELOP TEST N/PRF SS SS
------------------------------------------------------------------------------------------------------------------------------------
97047 LANDSCAPE GARDENING B + Yes
------------------------------------------------------------------------------------------------------------------------------------
97050 LAWN CARE B + Yes
------------------------------------------------------------------------------------------------------------------------------------
97111 LOGGING AND LUMBERING SS +
------------------------------------------------------------------------------------------------------------------------------------
97220 MACHINE SHOPS NOC B SS
------------------------------------------------------------------------------------------------------------------------------------
97221 MACHINE EQUIPMENT FARM INSTALL ETC SS SS
------------------------------------------------------------------------------------------------------------------------------------
97222 MACHINE EQUIPMENT INDUSTRIAL SS SS
------------------------------------------------------------------------------------------------------------------------------------
97223 MACHINE EQUIPMENT INSTALL NOC SS SS
------------------------------------------------------------------------------------------------------------------------------------
97447 MASONRY B B Yes
------------------------------------------------------------------------------------------------------------------------------------
97650 METAL ERECTION DECORATVE ARTIST B B Yes
------------------------------------------------------------------------------------------------------------------------------------
97651 METAL ERECTION - FRAME IRONWORK OUTSIDE SS SS
------------------------------------------------------------------------------------------------------------------------------------
97652 METAL ERECTION DWELLINGS UP TO 2 XXXX. SS SS
------------------------------------------------------------------------------------------------------------------------------------
97653 METAL ERECTION - NON-STRUCTURAL SS SS
------------------------------------------------------------------------------------------------------------------------------------
97655 METAL ERECTION - STRUCTURAL SS SS
------------------------------------------------------------------------------------------------------------------------------------
98090 MOTION PICTURE DEVELOP PRINTING B +
------------------------------------------------------------------------------------------------------------------------------------
98091 MOTION PICTURE DISTRIB EXCHANGE B +
------------------------------------------------------------------------------------------------------------------------------------
98111 OFFICE MACHINE APPLIANCE REPAIR B + Yes
------------------------------------------------------------------------------------------------------------------------------------
98257 ORCHARD VINEYARD RUN BY CONTRACTOR SS +
------------------------------------------------------------------------------------------------------------------------------------
98303 PAINTING EXTERIOR >3 STORIES B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98304 PAINTING EXTERIOR UP TO 3 STORIES B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98305 PAINTING INTERIOR B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98308 PAINTING SHOP ONLY B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98344 PAPERHANGING B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98405 PIANO TUNING B + Yes
------------------------------------------------------------------------------------------------------------------------------------
98449 PLASTERING OR STUCCO WORK B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98482 PLUMBING COMMERCIAL, INDUSTRIAL B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98483 PLUMBING RESIDENTIAL, DOMESTIC B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98502 PREFAB BUILDING ERECTION B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98597 RADIO OR TV BROADCASTING PROFIT B +
------------------------------------------------------------------------------------------------------------------------------------
98598 RADIO TV BROADCASTING NOT PROF B +
------------------------------------------------------------------------------------------------------------------------------------
98636 REFRIGERATION SYSTEM EQUIP INSTALL ETC B B Yes
------------------------------------------------------------------------------------------------------------------------------------
47051 REAL ESTATE DEVELOPERS P P
------------------------------------------------------------------------------------------------------------------------------------
98640 RENOVATING OUTSIDE SURFACES OF BLDGS B + Yes
------------------------------------------------------------------------------------------------------------------------------------
98658 RIGGING SS +
------------------------------------------------------------------------------------------------------------------------------------
98677 ROOFING - COMMERCIAL P P
------------------------------------------------------------------------------------------------------------------------------------
98678 ROOFING - RESIDENTIAL P P
------------------------------------------------------------------------------------------------------------------------------------
98698 SALVAGE OPERATIONS NOC SS SS
------------------------------------------------------------------------------------------------------------------------------------
98699 SALVAGE OPERATE REMOVAL ETC SS SS
------------------------------------------------------------------------------------------------------------------------------------
98705 SANDBLASTING SB +
------------------------------------------------------------------------------------------------------------------------------------
98710 SAND OR GRAVEL DIGGING SB +
------------------------------------------------------------------------------------------------------------------------------------
98805 SEPTIC TANK SYSTEMS CLEANING B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98806 SEPTIC TANK SYSTEMS INSTAL, SVC. REP. B B
------------------------------------------------------------------------------------------------------------------------------------
98813 SEWER CLEANING SS SS
------------------------------------------------------------------------------------------------------------------------------------
98820 SEWER MAINS OR CONNECTIONS CONSTR. B B
------------------------------------------------------------------------------------------------------------------------------------
98884 SHEET METAL WORK - OUTSIDE B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98967 SIDING INSTALLATION B B Yes
------------------------------------------------------------------------------------------------------------------------------------
98993 SIGN ERECTION INSTALL REPAIR B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99003 SIGN PAINTING, LETTERING INSIDE BLDG B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99004 SIGN PAINTING, LETTERING BLDG, STRUCTURE B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99303 SNOW REMOVAL, PARKING LOT & DRIVEWAY B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99321 STREET, ROAD PAVING REPAVING ETC. SS SS
------------------------------------------------------------------------------------------------------------------------------------
99471 SURVEYING - LAND (NO CONSTRUCTION) B B
------------------------------------------------------------------------------------------------------------------------------------
99505 SWIMMING POOL SERVICING B + Yes
------------------------------------------------------------------------------------------------------------------------------------
99506 SWIM POOL INSTALL SERV REPAIR SS +
------------------------------------------------------------------------------------------------------------------------------------
99507 SWIM POOL INSTALL SERV BELOW GR SS +
------------------------------------------------------------------------------------------------------------------------------------
99600 TELECOMMUNICATION SERVICE PROVIDER SS +
------------------------------------------------------------------------------------------------------------------------------------
99613 TELEPHONE/ CABLE TV LINE CONSTRUCTION B B
------------------------------------------------------------------------------------------------------------------------------------
99620 TELEPRODUCTION STUDIOS B +
------------------------------------------------------------------------------------------------------------------------------------
99650 TV RADIO RECEIVING SET INSTALLING B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99709 TENT OR CANVAS GOODS-ERECTION B B
------------------------------------------------------------------------------------------------------------------------------------
99718 THEATRICAL COMPANIES SB +
------------------------------------------------------------------------------------------------------------------------------------
99746 TILE, STONE, MARBLE, TERRAZO, MOSAIC WORK B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99777 TREE PRUNING, DUSTING, SPRAYING ETC B + Yes
------------------------------------------------------------------------------------------------------------------------------------
99793 TRUCKERS B +
------------------------------------------------------------------------------------------------------------------------------------
99826 UPHOLSTERING NOC B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99827 UPHOLSTERING SHOP ONLY B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99851 VETERINARIAN VETERINARY HOSP B +
------------------------------------------------------------------------------------------------------------------------------------
99917 WAREHOUSE COLD STORAGE PUBLIC B +
------------------------------------------------------------------------------------------------------------------------------------
99938 WAREHOUSES NOC B +
------------------------------------------------------------------------------------------------------------------------------------
99946 WATER MAIN CONNECTION CONSTRUCTION B B
------------------------------------------------------------------------------------------------------------------------------------
99948 WATER SOFTENING EQUIPMENT INSTALLING B B Yes
------------------------------------------------------------------------------------------------------------------------------------
99969 WELDING, CUTTING B SS
------------------------------------------------------------------------------------------------------------------------------------
99952 WATERPROOFING - PRESSURE APPARATUS B B
------------------------------------------------------------------------------------------------------------------------------------
99953 WATERPROOFING - TROWEL, EXTERIOR SS SS
------------------------------------------------------------------------------------------------------------------------------------
99954 WATERPROOFING - TROWEL, INTERIOR SS SS
------------------------------------------------------------------------------------------------------------------------------------
99955 WATERPROOFING, NOC B B
------------------------------------------------------------------------------------------------------------------------------------
99975 WINDOW CLEANING B + Yes
------------------------------------------------------------------------------------------------------------------------------------
91342 WINDOW INSTALLATION - WOOD (CARPENTRY) B B
------------------------------------------------------------------------------------------------------------------------------------
00000 XXXXXXXX XXXX XXXXXXXXXX XXX X +
------------------------------------------------------------------------------------------------------------------------------------
99987 WRECKING NOT EXCEED 3 STORIES B +
------------------------------------------------------------------------------------------------------------------------------------
