Common use of Quantitative and Other Limitations Clause in Contracts

Quantitative and Other Limitations. The Company recognizes the importance of diversification and credit quality. Applicable law addresses these issues by imposing certain quantitative and qualitative limitations relating to the strategies and instruments employed to effect a derivative transaction, as well as limitations relating to the diversification and credit quality of derivative transaction counterparties. Prior to entering into a derivative transaction, the Derivatives Desk will confirm that such proposed derivative transaction is in compliance with all qualitative and quantitative limitations set forth in the Colorado and New York Insurance Code. Thereafter, the applicable Reporting Groups (Risk Management and Client Finance) will confirm compliance with such qualitative and quantitative limitations. In addition, the applicable Reporting Groups shall continually monitor the Company’s compliance with and usage of such limitations, and each quarter Client Finance shall submit the Report (as defined in Section V. A. 5.) to US Risk Committee and the Board, which describes such compliance. Unless stricter standards are otherwise provided for under applicable law or the Company through the risk management process, the Company’s limits for different derivative strategies and instruments are as follows: