AMENDMENT
to the Risk Premium Reinsurance Agreement (the "Agreement")
effective September 1, 1983, between
CENTURY LIFE OF AMERICA of Waverly, Iowa,
hereinafter referred to as the "REINSURED,"
and
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY of Fort Xxxxx, Indiana,
hereinafter referred to as the "LINCOLN."
1. On and after the first day of July, 1990, the retention limit of
the REINSURED shall be that shown in the revised Schedule A, attached hereto.
This retention shall apply to reinsurance ceded after the effective date hereof
in accordance with the "INCREASE IN LIMIT OF RETENTION" article of the Agreement
of which this amendment is a part.
2. On and after the first day of July, 1990, the REINSURED may cede
and the LINCOLN shall accept automatically amounts of reinsurance not to exceed
those described in the attached Schedule B.
3. As of the effective date of this Amendment, Schedule B, Part I
shall be deleted and the "CONDITIONAL RECEIPT REINSURANCE" article shall be
added to the Agreement and shall read as follows:
"CONDITIONAL RECEIPT REINSURANCE
--------------------------------
A. Subject to the terms, conditions, and limits of this Agreement
and provided the conditions set forth in section B of this article
are fulfilled, the LINCOLN shall reimburse the REINSURED for a
claim in excess of the appropriate retention set forth in the
Schedule A paid by the REINSURED pursuant to a conditional
receipt, except that in no event shall the LINCOLN'S liability
pursuant to this article exceed $250,000.
B. The following conditions must be satisfied in order for
reinsurance of a conditional receipt to be effective:
(1) the REINSURED must become liable for a claim pursuant to a
conditional receipt issued on a form in conformity to the
Conditional Receipt Schedule of this Agreement; and
(2) the conditional receipt must be given in return for an
application on the life of an insured having a surname
beginning with the letters of the alphabet specified in the
Appendix I, for a policy form listed in the Appendix I, and
which would bear a register date in the range set forth in the
Appendix I; and
(3) either the policy being applied for must qualify for
automatic reinsurance or the REINSURED has not received a
facultative offer of reinsurance on the application from another
reinsurer which is a better offer than any facultative offer made
by LINCOLN."
4. It is hereby agreed that the Arbitration Schedule, attached hereto,
shall be added to the Agreement and the "ARBITRATION" article of the
Agreement shall be replaced with the following:
"ARBITRATION
------------
It is the intention of the REINSURED and the LINCOLN that the customs
and practices of the insurance and reinsurance industry shall be given
full effect in the operation and interpretation of this Agreement. The
parties agree to act in all things with the highest good faith. If the
REINSURED and the LINCOLN cannot mutually resolve a dispute which
arises out of or relates to this Agreement, however, the dispute shall
be decided through arbitration as set forth in the Arbitration
Schedule. The arbitrators shall base their decision on the terms and
conditions of this Agreement plus, as necessary, on the customs and
practices of the insurance and reinsurance industry rather than solely
on a strict interpretation of the applicable law. There shall be no
appeal from their decision, except that either party may petition a
court having jurisdiction over the parties and the subject matter to
reduce the arbitrators' decision to judgment."
It is expressly understood and agreed that the provisions of this
amendment shall be subject to all the terms and conditions of the Agreement of
which this amendment is a part which do not conflict with the terms hereof.
IN WITNESS WHEREOF the parties hereto have caused this amendment to be
executed in duplicate on the dates shown below.
CENTURY LIFE OF AMERICA
Signed at Waverly, Iowa
-------------------
By /s/ Xxxxxx X Xxxxxxxxxx By
-------------------------- --------------------------
Title AVP - Valuation Actuary Title
----------------------- -----------------------
Date Sept 7, 1990 Date
----------------------- ------------------------
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
Signed at Fort Xxxxx, Indiana
By /s/ Xxxxx Xxxxxx By /s/ Xxxxx X. Xxxxxx
------------------------- -------------------------
Vice President Assistant Secretary
Date 9/27/90 Date September 24, 1990
------------------------ -----------------------
SCHEDULE A
(Effective July 1, 1990)
Retention Limits of the REINSURED
Life*
-----
Ages Standard
---- --------
0-70 $500,000
71-80 40,000
AGES A & AA B & BB C - D E - X X - X X - P
---- ------ ------ ----- ----- ----- -----
0-50 500,000 442,000 375,000 300,000 192,000 100,000
51 482,000 425,000 362,000 288,000 185,000 98,000
52 463,000 408,000 347,000 278,000 177,000 93,000
53 443,000 392,000 333,000 267,000 170,000 89,000
54 425,000 375,000 318,000 255,000 163,000 85,000
55 407,000 358,000 305,000 243,000 155,000 83,000
56 388,000 342,000 290,000 233,000 148,000 78,000
57 368,000 325,000 277,000 222,000 142,000 74,000
58 350,000 310,000 263,000 210,000 135,000 70,000
59 332,000 293,000 248,000 198,000 127,000 68,000
60 313,000 277,000 235,000 188,000 120,000 63,000
61 293,000 260,000 220,000 177,000 113,000 59,000
62 275,000 243,000 207,000 165,000 105,000 55,000
63 257,000 227,000 192,000 153,000 98,000 53,000
64 238,000 210,000 178,000 143,000 92,000 48,000
65 218,000 193,000 163,000 132,000 83,000 44,000
66 200,000 177,000 150,000 120,000 77,000 40,000
67 182,000 160,000 137,000 108,000 70,000 38,000
68 163,000 143,000 122,000 98,000 62,000 33,000
69 143,000 127,000 108,000 87,000 55,000 29,000
70 125,000 110,000 93,000 75,000 48,000 25,000
71-80 40,000 40,000 40,000 40,000 40,000 25,000
*The above amounts shall be exceeded by as much as $15,000 to avoid reinsurance.
Waiver of Premium Disability
----------------------------
$1,000,000 of Total Life In Force
Accidental Death
----------------
$150,000
SCHEDULE B
(Effective July 1, 1990)
Maximum Amounts which the REINSURED may cede Automatically
Life
----
Ages Standard-Table P Over Table P
---- ---------------- ------------
0-15 300% of the life retention,
not to exceed $1,500,000 None
16-70 400% of the life retention,
not to exceed $2,000,000 None
71-75 400% of the life retention,
not to exceed $160,000 None
Over 75 None None
Waiver of Premium Disability
----------------------------
The REINSURED may cede automatically Waiver of Premium Disability reinsurance in
amounts applicable to the amount of Life reinsurance ceded automatically not to
exceed the following:
Ages Standard-Table P Over Table P
---- ---------------- ------------
0-44 $2,000,000 None
44-65 1,000,000 None
Over 65 None None
Accidental Death Benefits
-------------------------
Ages Standard-Table F Over Table F
---- ---------------- ------------
0-65 $100,000 None
Over 65 None None
CONDITIONAL RECEIPT SCHEDULE
Conditional Receipt
[LOGO OF CONDITIONAL RECEIPT MAY 30 1990
CENTURY READ CAREFULLY
LIFE OF
AMERICA]
CENTURY LIFE OF AMERICA
IN NO EVENT SHALL ANY CHANGE, ADDITION OF INSURANCE, OR BENEFIT WHICH REQUIRES
EVIDENCE OF INSURABILITY BE EFFECTIVE UNLESS THE CONDITIONS STATED BELOW HAVE
BEEN COMPLLED WITH,
o Received $........................ in connection with an identically numbered
Application for Change of Policy.
o Initial deduction authorized $ ...................... from policy no.
............................. in connection with an identically numbered
Application for Change of Policy.
This payment is made or this deduction is authorized and accepted subject to the
following conditions:
1. For life policies which do not require regularly scheduled premiums, any
change, addition of insurance, or benefit applied for and subject to the
limit specified below shall take effect on the later of:
a. completion of the last of any medical examinations or tests required of
the proposed insured by the Company's underwriting rules for the age and
amount of insurance applied for, or
b. completion of this payment or authorization.
2. For all other policies, any change, addition of insurance, or benefit
applied for and subject to the limit specified below shall take effect on
the later of:
a. the monthly anniversary prior to the date of the last of any medical
examinations or tests required of the proposed insured by the Company's
underwriting rules for the age and amount of insurance applied for, or
b. the monthly anniversary prior to the date of this payment or
authorization.
3. The proposed insured, in the opinion of the Company's authorized officers at
the home office, was insurable an acceptable under the rules and practices of
the Company for the plan or benefit and amount applied for at the premium
rate applied for or a lower rate.
4. The last of any required medical examinations or tests is completed within
60 days after the date of this receipt.
If the conditions stated above have not been complied with, there shall be no
liability on the part of the Company with respect to any change, addition of
insurance, or benefit applied for, except to return any payment in the form of
the Company's check or restore any initial deduction authorized upon surrender
of this receipt.
The maximum insurance under this receipt shall in no case exceed $300,000,
including all life and accidental death insurance then in force with the
Company.
No agent of Century Life of America has any power or authority to change or
modify any of the provisions of this Conditional Receipt.
This receipt shall be void if altered, modified, or if any check or draft given
in exchange for it is not paid when presented for payment.
ALL PREMIUM CHECKS MUST BE MADE PAYABLE TO THE INSURANCE COMPANY - DO NOT MAKE
CHECK PAYABLE TO THE AGENT OR LEAVE THE PAYEE BLANK.
Dated at ........................ on ..................., 19 ..................
Agent .......................
STAMP
ARBITRATION SCHEDULE
To initiate arbitration, either the REINSURED or the LINCOLN shall notify the
other party in writing of its desire to arbitrate, stating the nature of its
dispute and the remedy sought. The party to which the notice is sent shall
respond to the notification in writing within ten (10) days of its receipt.
The arbitration hearing shall be before a panel of three arbitrators, each of
whom must be a present or former officer of a life insurance company. An
arbitrator may not be a present or former officer, attorney, or consultant of
the REINSURED or the LINCOLN or either's affiliates.
The REINSURED and the LINCOLN shall each name five (5) candidates to serve as an
arbitrator. The REINSURED and the LINCOLN shall each choose one candidate from
the other party's list, and these two candidates shall serve as the first two
arbitrators. If one or more candidates so chosen shall decline to serve as an
arbitrator, the party which named such candidate shall add an additional
candidate to its list, and the other party shall again choose one candidate from
the list. This process shall continue until two arbitrators have been chosen and
have accepted. The REINSURED and the LINCOLN shall each present their initial
lists of five (5) candidates by written notification to the other party within
twenty-five (25) days of the date of the mailing of the notification initiating
the arbitration. Any subsequent additions to the list which are required shall
be presented within ten (10) days of the date the naming party receives notice
that a candidate that has been chosen declines to serve.
The two arbitrators shall then select the third arbitrator from the eight (8)
candidates remaining on the lists of the REINSURED and the LINCOLN within
fourteen (14) days of the acceptance of their positions as arbitrators. If the
two arbitrators cannot agree on the choice of a third, then this choice shall be
referred back to the REINSURED and the LINCOLN. The REINSURED and the LINCOLN
shall take turns striking the name of one of the remaining candidates from the
initial eight (8) candidates until only one candidate remains. If the candidate
so chosen shall decline to serve as the third arbitrator, the candidate whose
name was stricken last shall be nominated as the third arbitrator. This process
shall continue until a candidate has been chosen and has accepted. This
candidate shall serve as the third arbitrator. The first turn at striking the
name of a candidate shall belong to the party that is responding to the other
party's initiation of the arbitration. Once chosen, the arbitrators are
empowered to decide all substantive and procedural issues by a majority of
votes.
It is agreed that each of the three arbitrators should be impartial regarding
the dispute and should resolve the dispute on the basis described in the
"ARBITRATION" article. Therefore, at no time will either the REINSURED or the
LINCOLN contact or otherwise communicate with any person who is to be or has
been designated as a candidate to serve as an arbitrator concerning the
dispute, except upon the basis of jointly drafted communications provided by
both the REINSURED and the LINCOLN to inform those candidates actually chosen as
arbitrators of the nature and facts of the dispute. Likewise, any written or
oral arguments provided to the
ARBITRATION SCHEDULE (Continued)
arbitrators concerning the dispute shall be coordinated with the other party and
shall be provided simultaneously to the other party or shall take place in the
presence of the other party. Further, at no time shall any arbitrator be
informed that the arbitrator has been named or chosen by one party or the other.
The arbitration hearing shall be held on the date fixed by the arbitrators. In
no event shall this date be later than six (6) months after the appointment of
the third arbitrator. As soon as possible, the arbitrators shall establish
prearbitration procedures as warranted by the facts and issues of the particular
case. At least ten (10) days prior to the arbitration hearing, each party shall
provide the other party and the arbitrators with a detailed statement of the
facts and arguments it will present at the arbitration hearing. The arbitrators
may consider any relevant evidence; they shall give the evidence such weight as
they deem it entitled to after consideration of any objections raised concerning
it. The party initiating the arbitration shall have the burden of proving its
case by a preponderance of the evidence. Each party may examine any witnesses
who testify at the arbitration hearing. Within twenty (20) days after the end of
the arbitration hearing, the arbitrators shall issue a written decision that
sets forth their findings and any award to be paid as a result of the
arbitration, except that the arbitrators may not award punitive or exemplary
damages. In their decision, the arbitrators shall also apportion the costs of
arbitration, which shall include, but not be limited to, their own fees and
expenses.
