AUTOMATIC AND FACULTATIVE
YEARLY RENEWABLE TERM REINSURANCE AGREEMENT
EFFECTIVE December 15, 2003
PRUCO LIFE INSURANCE COMPANY
(hereinafter referred to as "THE COMPANY")
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And
MUNICH AMERICAN REASSURANCE COMPANY
(hereinafter referred to as "THE REINSURER")
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Table of Contents
PREAMBLE ............................................................................................ 4
1. PARTIES TO THE AGREEMENT............................................................................... 6
2. EFFECTIVE DATE OF THE AGREEMENT........................................................................ 6
3. SCOPE OF THE AGREEMENT................................................................................. 6
4. POLICIES AND RISKS REINSURED UNDER THE AGREEMENT...................................................... 6
5. DURATION OF THE AGREEMENT.............................................................................. 7
6. BASIS OF REINSURANCE................................................................................... 7
7. AUTOMATIC REINSURANCE TERMS............................................................................ 7
a. CONVENTIONAL UNDERWRITING........................................................................ 7
b. RESIDENCE AND TRAVEL............................................................................. 7
c. OCCUPATION....................................................................................... 7
d. AUTOMATIC ACCEPTANCE LIMIT....................................................................... 7
e. JUMBO LIMIT...................................................................................... 7
f. MINIMUM CESSION.................................................................................. 8
g. FACULTATIVE QUOTES............................................................................... 8
8. PORTIONS REINSURED AND RETAINED UNDER AUTOMATIC REINSURANCE...................................... 8
a. AUTOMATIC PORTION REINSURED...................................................................... 8
b. AUTOMATIC PORTION RETAINED....................................................................... 8
9. AUTOMATIC REINSURANCE NOTICE PROCEDURE................................................................ 8
10. FACULTATIVE REINSURANCE.............................................................................. 8
11. COMMENCEMENT OF REINSURANCE COVERAGE................................................................. 8
a. AUTOMATIC REINSURANCE............................................................................ 8
b. FACULTATIVE REINSURANCE.......................................................................... 9
12. REINSURANCE PREMIUM RATES............................................................................ 9
13. REVISION OF PREMIUM RATES ........................................................................... 9
14. PAYMENT OF REINSURANCE PREMIUMS...................................................................... 11
a. PREMIUM DUE...................................................................................... 11
b. FAILURE TO PAY PREMIUMS.......................................................................... 11
c. PREMIUM ADJUSTMENT............................................................................... 11
15. PREMIUM TAX REIMBURSEMENT............................................................................ 11
16. DAC TAX AGREEMENT.................................................................................... 11
17. REPORTS.............................................................................................. 12
18. RESERVES FOR REINSURANCE.............................................................................. 18
19. CLAIMS................................................................................................ 12
a. NOTIFICATION OF CLAIMS........................................................................... 13
b. AMOUNT AND PAYMENT OF BENEFITS................................................................... 13
c. LIVING NEEDS BENEFITS............................................................................ 13
d. CLAIM SETTLEMENTS................................................................................ 13
e. CLAIM EXPENSES................................................................................... 13
f. EXTRACONTRACTUAL DAMAGES......................................................................... 14
20. MISREPRESENTATION, SUICIDE, AND MISSTATEMENT......................................................... 14
21. POLICY CHANGES....................................................................................... 14
a. NOTICE........................................................................................... 14
b. INCREASES........................................................................................ 14
c. REDUCTION OR TERMINATION......................................................................... 15
d. PLAN CHANGES..................................................................................... 15
e. DEATH BENEFIT OPTION CHANGES..................................................................... 15
22. RECAPTURE........................................................................................ 15
23. REINSTATEMENTS................................................................................... 16
a. AUTOMATIC REINSTATEMENT.......................................................................... 16
b. FACULTATIVE REINSTATEMENT........................................................................ 16
c. PREMIUM ADJUSTMENT............................................................................... 16
24. ERRORS AND OMISSIONS............................................................................. 16
25. INSOLVENCY............................................................................................ 16
26. ARBITRATION...................................................................................... 17
a. GENERAL.......................................................................................... 17
b. NOTICE........................................................................................... 17
c. PROCEDURE........................................................................................ 17
d. COSTS............................................................................................ 18
27. GOOD FAITH....................................................................................... 18
28. REPRESENTATIONS AND WARRANTIES................................................................... 18
29. CONFIDENTIALITY...................................................................................... 19
30. MEDICAL INFORMATION BUREAU........................................................................... 20
31. GOVERNING LAW........................................................................................ 20
32. ASSIGNMENT............................................................................................ 20
33. ACCESS TO RECORDS.................................................................................... 20
34. SEVERABILITY......................................................................................... 20
35. REINSURANCE ADMINISTRATION........................................................................... 21
36. NONWAIVER............................................................................................ 21
37. COUNTERPARTS......................................................................................... 21
38. FINANCIAL REPORTS.................................................................................... 21
39. OFFSET............................................................................................... 21
40. SURVIVAL............................................................................................. 21
41. SERVICE OF SUIT...................................................................................... 21
42. NOTICES.............................................................................................. 21
ATTACHMENTS:
SCHEDULE A - REINSURANCE COVERAGE
SCHEDULE B - AUTOMATIC AND FACULTATIVE REINSURANCE PREMIUMS
SCHEDULE C - REPORTING INFORMATION - INFORMATION ON RISKS REINSURED
SCHEDULE D - MONTHLY BILLING AND ACCOUNTING SUMMARY
SCHEDULE E - FACULTATIVE REINSURANCE APPLICATION
SCHEDULE F - FACULTATIVE REINSURANCE NOTIFICATION
SCHEDULE G - CARRIER FACT SHEETS
AUTOMATIC AND FACULTATIVE YEARLY RENEWABLE TERM
REINSURANCE AGREEMENT
PREAMBLE
Pruco Life Insurance Company (THE COMPANY) issues policies known as M Premier VUL (MPVUL) as more fully described
in the attached Schedule A. With respect to 50% of the risk, THE COMPANY will retain at least 10% of the policy
risk amount on each policy up to its retention limit. THE COMPANY will cede up to 40% of the policy risk amount
to various reinsurers as follows:
o This Automatic and Facultative Yearly Renewable Term Reinsurance Agreement (this "Agreement") between
THE COMPANY and Munich American Reassurance Company ("THE REINSURER")
o One or more other Automatic and Facultative Yearly Renewable Term Reinsurance Agreements ("Other YRT
Agreements") between THE COMPANY and various reinsurers.
With respect to the remainding 50% of the risk, THE COMPANY is participating in a reinsurance program comprised
of several reinsurance agreements. These agreements include the following:
o Automatic and Facultative Modified Coinsurance Agreement ("Modco Agreement") between THE COMPANY and M
Life Insurance Company
o Automatic and Facultative Yearly Renewable Term Agreements between THE COMPANY and various reinsurers.
The risks transferred under the Modco Agreement include all significant risks other than the portion of the
mortality risk covered under Other YRT Agreements on the remaining 50% of the risks.
In the context of the above reinsurance programs, the reinsurance provided under this Agreement and the Other YRT
Agreements is known as "THIRD-PARTY REINSURANCE" and THE REINSURER and other reinsurers are known as "THIRD-PARTY
REINSURERS".
All of the reinsurance agreements referred to above shall operate independently of one another, except where
specifically indicated in the agreements.
AUTOMATIC AND FACULTATIVE YEARLY RENEWABLE TERM
REINSURANCE AGREEMENT
1. PARTIES TO THE AGREEMENT
This Agreement is solely between THE REINSURER and THE COMPANY, a life insurance company domiciled in
Arizona. There is no third party beneficiary to this Agreement. Reinsurance under this Agreement will
not create any right or legal relationship between THE REINSURER and any other person, for example, any
insured, policyowner, agent, beneficiary, or assignee. THE COMPANY agrees that it will not make THE
REINSURER a party to any litigation between any such third party and THE COMPANY. THE COMPANY will not
use or disclose THE REINSURER's name with regard to THE COMPANY's agreements or transactions with these
third parties unless THE REINSURER gives prior written approval for the use or disclosure of its name or
unless THE COMPANY is compelled by law to do so.
The terms of this Agreement are binding upon the parties, their representatives, successors, and
assigns. The parties to this Agreement are bound by ongoing and continuing obligations and liabilities
until the later of (1) when this Agreement terminates and (2) when the underlying policies are no longer
in force. This Agreement shall not be bifurcated, partially assigned, or partially assumed.
2. EFFECTIVE DATE OF THE AGREEMENT
This Agreement will incept on the date hereof, to be effective as of 12:01 A.M., December 15, 2003 and
will cover policies effective on and after that date. In addition, THE REINSURER agrees to accept
reinsurance coverage for policies backdated to save age up to six months prior to the effective date of
this Agreement. The reinsurance coverage for any backdated policies will be effective as of the policy
effective date.
3. SCOPE OF THE AGREEMENT
The text of this Agreement and all Exhibits, Schedules and Amendments are considered to be the entire
agreement between the parties. There are no other understandings or agreements between the parties
regarding the policies reinsured other than as expressed in this Agreement. The parties may make
changes or additions to this Agreement, but they will not be considered to be in effect unless they are
made by means of a written amendment that has been signed and dated by both parties to this Agreement
4. POLICIES AND RISKS REINSURED UNDER THE AGREEMENT
THE REINSURER agrees to indemnify by means of indemnity reinsurance, and THE COMPANY agrees to reinsure
with THE REINSURER, according to the terms and conditions hereof, the portion of the policies on an
automatic and facultative basis as described and defined in Schedule A, which are placed in force while
this Agreement is in effect. The intent of this Agreement is to pass all of the mortality risk
associated with such portion of the original policies, to THE REINSURER without necessitating THE
COMPANY to transfer the assets or their cash equivalents to THE REINSURER.
5. DURATION OF THE AGREEMENT
The duration of this Agreement will be unlimited. However, either party may terminate the Agreement for
new business at any time by giving the other a 90-day prior written notice. THE REINSURER will continue
to accept new reinsurance during the 90-day period.
Existing reinsurance will not be affected by the termination of this Agreement with respect to new
reinsurance. Existing reinsurance will remain in force until the termination or expiry of the
underlying policies on which the reinsurance is based and THE REINSURER fulfills all of its obligations
under this Agreement, provided that THE REINSURER has not terminated for non-payment of premiums as
described in Section 14. However, existing reinsurance may be terminated in accordance with the
recapture provision described in Section 22.
6. BASIS OF REINSURANCE
Reinsurance under this Agreement will be on the Yearly Renewable Term basis on the portion of each
policy that is reinsured as described in Schedule A.
7. AUTOMATIC REINSURANCE TERMS
THE REINSURER agrees to automatically accept contractual risks on the life insurance policies shown in
Schedule A, subject to the following requirements:
a. CONVENTIONAL UNDERWRITING. Automatic reinsurance applies only to insurance applications fully
underwritten by THE COMPANY according to THE COMPANY's conventional underwriting and issue rules
and practices. Upon request, THE COMPANY shall provide THE REINSURER with a copy of its current
underwriting and issue rules and practices.
From time to time, it may be appropriate for THE COMPANY or THE REINSURER to request of the other
party changes in the underwriting rules and practices. The party requesting the change must
provide a 120-day advance written notice to the other party before the effective date of such
change. Recognition of reinsurance premium rates related to these changes must be determined
within the 120-day period. If the underwriting change or rate change is unacceptable to either
party, this Agreement may be unilaterally terminated for acceptance of new business with a 90-day
written termination notice to the other party.
b. RESIDENCE AND TRAVEL. To be eligible for automatic reinsurance, each insured must either be a resident
of the United States or Canada at the time of issue or be a resident of another country that meets
THE COMPANY's special underwriting requirements pertaining to foreign residence. However, automatic
reinsurance will not be available if the conditions stated in either Foreign Travel Exclusions or
Foreign Residence Exclusions in Schedule A apply.
c. OCCUPATION. To be eligible for automatic reinsurance, the insured must not be employed in an occupation
as shown in the Occupation Exclusion List in Schedule A.
d. AUTOMATIC ACCEPTANCE LIMIT. For any policy to be reinsured under automatic reinsurance, the face amount
shall not exceed the Automatic Acceptance Limit as shown in Schedule A.
e. JUMBO LIMIT. For any policy to be reinsured under automatic reinsurance, the total amount of insurance
in force and applied for in all companies shall not exceed the Jumbo Limit as shown in Schedule A.
f. MINIMUM CESSION. The minimum amount of reinsurance per cession that THE REINSURER will accept is shown
in Schedule A.
g. FACULTATIVE QUOTES. The risk shall not have been submitted on a facultative basis to THE REINSURER or
any other reinsurer.
8. PORTIONS REINSURED AND RETAINED UNDER AUTOMATIC REINSURANCE
a. AUTOMATIC PORTION REINSURED. For any policy reinsured under automatic reinsurance, the portion
reinsured is shown in Schedule A.
b. AUTOMATIC PORTION RETAINED. THE COMPANY will retain, and not otherwise reinsure, an amount of insurance
on each life as shown in Schedule A.
9. AUTOMATIC REINSURANCE NOTICE PROCEDURE
After the policy has been paid for and delivered, THE COMPANY will submit to THE REINSURER all relevant
individual policy information, as defined by Schedule C.
10. FACULTATIVE REINSURANCE
THE COMPANY may apply for facultative reinsurance with THE REINSURER on a risk if the automatic
reinsurance terms are not met or if the terms are met and it prefers to apply for facultative
reinsurance. To obtain a facultative reinsurance quote, THE COMPANY must submit the following:
a. A form substantially similar to the "Application for Reinsurance" form shown in Schedule E.
b. Copies of the original insurance application, medical examiner's reports, financial information, and all
other papers and information regarding the insurability of the risk.
After receipt of THE COMPANY's application, THE REINSURER will promptly examine the material and notify
THE COMPANY either of the terms and conditions of THE REINSURER's offer for facultative reinsurance or
that no offer will be made. THE REINSURER's offer expires 120 days after the offer is made unless the
written offer specifically states otherwise. If THE COMPANY accepts THE REINSURER's offer, then THE
COMPANY will make a dated notation of its acceptance in its underwriting file and mail as soon as
possible a formal reinsurance cession to THE REINSURER using a form substantially similar to the
Notification of Reinsurance form shown in Schedule F. If THE COMPANY does not accept THE REINSURER's
offer, then THE COMPANY will notify THE REINSURER in writing as soon as possible.
11. COMMENCEMENT OF REINSURANCE COVERAGE
Commencement of THE REINSURER's reinsurance coverage on any policy or pre-issue risk under this
Agreement is described below:
a. AUTOMATIC REINSURANCE. THE REINSURER's reinsurance coverage for any policy that is ceded automatically
under this Agreement will begin and end simultaneously with THE COMPANY's contractual liability for
the policy reinsured.
In addition, THE REINSURER will be liable for benefits paid under THE COMPANY's conditional
receipt, temporary insurance agreement or limited insurance agreement if all of the conditions for
automatic reinsurance coverage under Section 7 of this Agreement are met. THE REINSURER's
liability under THE COMPANY's conditional receipt, temporary insurance agreement or limited
insurance agreement is limited to the lesser of (1) THE REINSURER's reinsured portion of the face
amount of the policy and (2) THE REINSURER's reinsured portion multiplied by $1,000,000.
The pre-issue liability applies only once on any given life at one time no matter how many
conditional receipts, temporary insurance agreements or limited insurance agreements are in
effect. After a policy has been issued, no reinsurance benefits are payable under this pre-issue
coverage provision.
b. FACULTATIVE REINSURANCE. THE REINSURER's reinsurance coverage for any policy that is ceded
facultatively under this Agreement shall begin when (1) THE COMPANY accepts THE REINSURER's offer
by making a dated notation of its acceptance in its underwriting file and (2) the policy has been
issued.
In addition, THE REINSURER will be liable for benefits paid under THE COMPANY's conditional
receipt, temporary insurance agreement or limited insurance agreement if: (1) the policy is
prepaid, (2) THE REINSURER has made a binding offer, and (3) THE COMPANY has accepted that offer by
sending an email notification. THE REINSURER's liability under THE COMPANY's conditional receipt,
temporary insurance agreement or limited insurance agreement will be limited to the lesser of 1)
THE REINSURER's reinsured portion of the face amount of the policy and 2) the portion of
$1,000,000 that is derived as the amount of capacity reserved by THE COMPANY from THE REINSURER
divided by the sum of the total amount of capacity reserved by THE COMPANY from all reinsurers, and
the amount to be retained by THE COMPANY.
The pre-issue liability applies only once on any given life at one time no matter how many
conditional receipts or temporary insurance agreements are in effect. After a policy has been
issued, no reinsurance benefits are payable under this pre-issue coverage provision.
12. REINSURANCE PREMIUM RATES
RATES AND CALCULATION. The reinsurance premiums per $1000 are shown in Schedule B.
Reinsurance premiums for renewals will be calculated using (1) the issue age of the insured, (2)
the duration since issuance and (3) the current underwriting classification. Reinsurance premiums
for any face amount increases are calculated using (1) the age of the insured as of the effective
date of the increase, (2) the duration since the effective date of the increase and (3) the current
underwriting classification.
13. REVISION OF PREMIUM RATES
New Business
If THE REINSURER changes rates with respect to new business, then THE COMPANY has the right to terminate
this Agreement for new business if THE COMPANY deems the rate change unacceptable.
Inforce
a. THE REINSURER may change its reinsurance rates as a result of a mortality study as described in the
following:
i. THE COMPANY or THE REINSURER may, at their option, initiate a review of the mortality experience with
respect to the business reinsured hereunder. This review will use the guidelines in
Section 13a (iii) below to determine if an adjustment should be made in the reinsurance YRT
rates under this Agreement.
ii. The parties agree to evaluate the mortality experience by policy issue year, with respect to the
application of reinsurance premium rates. Any change to inforce reinsurance premium rates
will remain on a point-in-scale (durational) basis. Grouping of policy issue years will be
agreed upon by the parties for evaluation and rate application purposes.
iii. Mortality experience will not be credible for purposes of this article until at least 400 cumulative
death claims have been recorded for the policy year groupings being analyzed . The
following guidelines will be used to determine the appropriate adjustment to be made to the
reinsurance YRT rates under this Agreement:
o The intent is to maintain a current reinsurance rate scale with a target loss ratio of 87% under this
Agreement.
o The loss ratio will be calculated as accumulated reinsured incurred claims divided by accumulated Base
reinsurance earned premiums. Base reinsurance premiums are based on the
original reinsurance rates under this Agreement. Both the claims and the
premiums will be accumulated using an interest rate of 5%.
o New reinsurance rates will be set at the base reinsurance rates times the loss ratio divided by 87%.
o Rates will only be changed if the anticipated rate change is 5% or greater and the new rates will be
rounded up to the nearest .5%. For example, if the current rates for the best
preferred class are 35% of the 75-80 SOA table, then they would only be
revised if this experience analysis indicates that they should be less than or
equal to 33.0% or greater than or equal to 37.0%.
o Reinsurance rates for any policy issue years will not be changed more often than every three years.
b. In the event THE COMPANY raises its mortality charges to the underlying policyholder, THE REINSURER
retains the right to make a proprotionate increase to the reinsurance rates.
c. THE REINSURER may change its reinsurance rates for any other reason.
d. THE COMPANY retains the right to recapture as of the effective date of the rate change, in accordance
with Section 22, if any of the following occur:
i. A review of the mortality experience indicates a decrease in reinsurance rates as described in 'a' above
and THE REINSURER fails to decrease its reinsurance rates accordingly, or
ii. A review of the mortality experience indicates no change in reinsurance rates as described in 'a' above
and THE REINSURER increases its rates, or
iii. A review of the mortality experience indicates an increase in reinsurance rates as described in 'a'
above but THE REINSURER's increase is greater than the increase indicated, or
iv. THE REINSURER raises its rates as described in 'b' above and the increase is not in proportion to the
increase in mortality charges to the underlying policyholder, or
v. THE REINSURER changes it rates as described in 'c' above.
14. PAYMENT OF REINSURANCE PREMIUMS
a. PREMIUM DUE. For each policy reinsured under this Agreement, reinsurance premiums are payable
annually in advance. These premiums are due on the issue date and each subsequent policy
anniversary. Within 30 days after the close of each reporting period, THE COMPANY will send to THE
REINSURER a statement of account for that period along with payment of the full balance due. On
any payment date, monies payable between THE REINSURER and THE COMPANY under this Agreement, and
any other agreements between the parties (as per Section 39 of this Agreement), may be netted to
determine the payment due. This offset will apply regardless of the insolvency of either party as
described in Section 25, to the extent permitted by law. If the statement of account shows a
balance due THE COMPANY, THE REINSURER will remit that amount to THE COMPANY within 30 days of
receipt of the statement of account. All financial transactions under this Agreement will be in
United States dollars. If the reinsurance premium amounts cannot be determined on an exact basis
by the dates described below, such payments will be paid in accordance with a mutually agreed upon
formula which will approximate the actual payments. Adjustments will then be made to reflect
actual amounts when such information is available.
b. FAILURE TO PAY PREMIUMS. If reinsurance premiums are 90 days past due, the premiums will be
considered in default and THE REINSURER may terminate the reinsurance by providing a 30-day prior
written notice, provided payment is not received within that 30-day period. THE REINSURER will
have no further liability as of the termination date for benefits applicable to periods for the
which premium is not paid. THE COMPANY will be liable for the prorated reinsurance premiums to the
termination date. THE COMPANY agrees that it will not force termination under the provisions of
this paragraph solely to avoid the recapture requirements or to transfer the block of business
reinsured to another reinsurer.
THE COMPANY may reinstate reinsurance terminated for non-payment of balances due at any time within
60 days following the date of termination. However, THE REINSURER will have no liability for
claims incurred between the termination date and the reinstatement date.
c. PREMIUM ADJUSTMENT. If THE COMPANY overpays a reinsurance premium and THE REINSURER accepts the
overpayment, THE REINSURER's acceptance will not constitute or create a reinsurance liability or
increase in any existing reinsurance liability. Instead, THE REINSURER will be liable to THE
COMPANY for a credit in the amount of the overpayment. If a reinsured policy terminates, THE
REINSURER will refund the excess reinsurance premium. This refund will be on a prorated basis
without interest from the date of termination of the policy to the date to which a reinsurance
premium has been paid.
15. PREMIUM TAX REIMBURSEMENT
See Schedule B.
16. DAC TAX AGREEMENT
THE COMPANY and THE REINSURER, herein collectively called the "Parties", or singularly the "Party",
hereby enter into an election under Treasury Regulations Section 1.848-2(g) (8) as promulgated under the
Internal Revenue Code, as found in Title 26 of the United States Code, hereinafter referred to as the
Regulations and the IRC. Both parties agree to make the election contemplated by this Section 16 by
timely attaching to their U.S. tax returns the schedule contemplated by Section 1.848-2(g)(8)(ii) of the
Regulations. Furthermore, the parties agree to the following:
a. For each taxable year under this Agreement, the party with the net positive consideration, as defined in
the Regulations, will capitalize specified policy acquisition expenses with respect to this
Agreement without regard to the general deductions limitation of Section 848 (c) (1);
b. THE COMPANY and THE REINSURER agree to exchange information pertaining to the net consideration under
this Agreement each year to insure consistency or as otherwise required by the U.S. Internal
Revenue Service;
c. THE COMPANY will submit to THE REINSURER by May 1 of each year its calculation of the net consideration
for the preceding calendar year.
d. THE REINSURER may contest such calculation by providing an alternative calculation to THE COMPANY in
writing within 30 days of THE REINSURER's receipt of THE COMPANY's calculation. If THE REINSURER
does not so notify THE COMPANY, THE REINSURER will report the net consideration as determined by
THE COMPANY in THE REINSURER's tax return for the previous calendar year;
e. If THE REINSURER contests THE COMPANY's calculation of the net consideration, the parties will act in
good faith to reach an agreement as to the correct amount within 30 days of the date THE REINSURER
submits its alternative calculation. If THE COMPANY and THE REINSURER do not reach agreement on
the net amount of consideration within such 30-day period, then the net amount of consideration for
such year shall be determined by an independent accounting firm acceptable to both THE COMPANY and
THE REINSURER within 20 days after the expiration of such 30-day period.
f. THE COMPANY and THE REINSURER agree that this election shall first be effective for the 2004 calendar
tax year and will be effective for all subsequent taxable years for which this Agreement remains in
effect.
THE REINSURER and THE COMPANY represent and warrant that they are subject to U.S. taxation under either
Subchapter L of Chapter 1, or Subpart F of Subchapter N of Chapter 1 of the IRC of 1986, as amended.
17. REPORTS
The reporting period is shown in Schedule A. For each reporting period, THE COMPANY will submit reports
to THE REINSURER with information that is substantially similar to the information displayed in Schedule
C.
In addition, the reports will include a billing and accounting summary and a policy exhibit summary
similar to the reports shown in Schedule D.
Within 15 business days after the end of each calendar year, THE COMPANY will submit a reserve summary
similar to that shown in Schedule D. THE COMPANY will also submit this reserve summary within 10
business days after the end of each other calendar quarter.
18. RESERVES FOR REINSURANCE
See Schedule A.
19. CLAIMS
a. NOTIFICATION OF CLAIMS. THE COMPANY will provide THE REINSURER with notification of claims reported. In
addition, THE COMPANY will provide THE REINSURER with a notification of each claim incurred within
the first two policy years (individually, a "Contestable claim" and collectively "Contestable
Claims") on policies reinsured where THE REINSURER'S net amount at risk is greater than or equal to
$40,000, along with all relevant information including, but not limited to, claim proofs.
For all other claims, after THE COMPANY has received all proper claim proofs and paid the claim,
THE COMPANY will send THE REINSURER an itemized statement of amounts due THE COMPANY along with all
relevant information with respect to the claim, including the claim proofs. However, claim proofs
will not be required by THE REINSURER if THE REINSURER's net amount at risk is less than or equal
to $100,000 and THE COMPANY has paid the claim in full. In such cases, THE COMPANY will provide
THE REINSURER with the cause and date of death and information adequate to identify the policy for
which a claim is being made. Nothing in this Section supersedes Access to Records, Section 33.
b. AMOUNT AND PAYMENT OF BENEFITS. As soon as THE REINSURER receives the request for payment and any
required proof of the claim, reinsurance benefits are due and payable to THE COMPANY. Payment of
the benefits will be made in a single sum, regardless of THE COMPANY's settlement options. THE
COMPANY's contractual liability for claims is binding on THE REINSURER. The maximum benefit
payable to THE COMPANY under each reinsured policy is the amount specifically reinsured with THE
REINSURER.
c. LIVING NEEDS BENEFITS. Living Needs Benefit claims will be administered in the same way as a death
claim and Living Needs Benefit claims, both full and partial, will be specifically identified as
such on the lists of claims paid.
d. CLAIM SETTLEMENTS. THE REINSURER agrees that THE COMPANY will use its standard claim practices and
guidelines in the adjudication of all claims on policies reinsured under this Agreement. THE
REINSURER has the right to inspect, at the COMPANY's offices, the COMPANY's written claims
practices and guidelines. Once THE REINSURER has been notified of a contestable claim in accordance
with subsection a. above, THE REINSURER will have ten business days to review the information and
provide its opinion as to whether or not the reinsurance claim is payable.
THE COMPANY will advise THE REINSURER of any intention to contest a claim involving a policy
reinsured hereunder and provide THE REINSURER with copies of all relevant documents. THE REINSURER
may choose not to participate in the contest of a Contestable Claim. THE REINSURER will have 10
business days from the date it received the information to communicate its decision whether to
participate in the contested claim. If THE REINSURER chooses not to participate, it will discharge
its liability by immediately paying to THE COMPANY the full amount of THE REINSURER's liability on
the portion of the policy reinsured under this Agreement, regardless of any subsequent outcome of
such contest.
Provided that THE REINSURER does not discharge its liability in accordance with this paragraph, THE
COMPANY will make a reasonable effort to keep THE REINSURER informed of subsequent developments in
the contest of the claim.
e. CLAIM EXPENSES. THE REINSURER will pay its share of any interest paid by THE COMPANY on any claim
payment. In addition, THE REINSURER will pay its share of the unusual expense of adjudicating
contestable claims, which expense was paid by THE COMPANY. The term "unusual expense" shall mean
all expenses of THE COMPANY associated with the contestable claim other than normal and customary
claim administration expenses that are commonly incurred with the normal and customary settlement
of non-contestable claims. Also, expenses incurred in connection with a dispute or contest arising
out of conflicting claims of entitlement to policy proceeds or benefits that THE COMPANY admits are
payable are not a claim expense under this Agreement. Notwithstanding the above, THE REINSURER
will not be liable for any portion of interest or unusual expenses for any period of time after THE
REINSURER chooses not to participate in a contested, compromised or litigated claim.
f. EXTRACONTRACTUAL DAMAGES. Generally, THE REINSURER will not participate in punitive or compensatory
damages, which are awarded against THE COMPANY as a result of an act, omission or course of conduct
committed by THE COMPANY in connection with the policies reinsured under this Agreement. THE
REINSURER will, however, pay its share of THE COMPANY's share of statutory penalties awarded
against THE COMPANY in connection with the policies reinsured under this Agreement. The parties
recognize that circumstances may arise in which equity would require THE REINSURER, to the extent
permitted by law, to share proportionately in certain assessed damages. Such circumstances are
difficult to define in advance, but generally would be those situations in which THE REINSURER was
an active party and in writing either directed, consented to, or ratified the act, omission, or
course of conduct of THE COMPANY which ultimately results in the assessment of punitive and/or
compensatory damages. In such situations, THE COMPANY and THE REINSURER would share such damages
assessed in equitable proportions.
For purposes of the provision, the following definitions will apply:
"Punitive Damages" are those damages awarded as a penalty, the amounts of which are not governed or
fixed by statute;
"Statutory Penalties" are those amounts that are awarded as a penalty, but are fixed in amount by
statute;
"Compensatory Damages" are those amounts awarded to compensate for actual damages sustained, and
are not awarded as a penalty, nor fixed in amount by statute.
20. MISREPRESENTATION, SUICIDE, AND MISSTATEMENT
If either a misrepresentation on an application or a death of an insured by suicide results in the
return of policy premiums by THE COMPANY under the policy rather than payment of policy benefits, THE
REINSURER will refund all of the reinsurance premiums paid for that policy to THE COMPANY. If there is
an adjustment for a misrepresentation or misstatement of age or sex, a corresponding adjustment to the
reinsurance benefit will be made.
21. POLICY CHANGES
a. NOTICE. If a reinsured policy is changed as described below, a corresponding change will be made in the
reinsurance for that policy. THE COMPANY will notify THE REINSURER of the change in THE COMPANY's
next report as stated in Section 17.
b. INCREASES. If a request for an increase in the amount of insurance is made for a reinsured policy and
the insured meets THE COMPANY's automatic underwriting requirements and THE COMPANY approves the
increase under the policy, then the increase will be added to the policy as a new layer. The
increase layer will have a separate policy record and its own effective date. The portion of the
layer reinsured under this Agreement is equal to the amount shown in Schedule A. Increase layers
with an effective date after the termination of this Agreement for new business will not be
reinsured under this Agreement.
If a request for an increase is made for a reinsured policy and the insured meets THE COMPANY's
automatic underwriting requirements and a new policy is issued on one of the plans shown in
Schedule A for the higher amount, then reinsurance under the old policy will cease as of the
effective date of the change, and reinsurance under the new policy will commence as of the policy
date of the new policy.
If a request for an increase in a reinsured policy is granted without the insured meeting THE
COMPANY's requirements, then reinsurance on the increase will not be allowed.
If a request for an increase does not meet all of the terms of automatic reinsurance, then THE
COMPANY may apply for facultative reinsurance as stated in 10.
c. REDUCTION OR TERMINATION. If the amount of insurance on a reinsured policy is reduced, the reinsurance
will be reduced proportionately as of the effective date of the reduction.
If a reinsured policy is terminated, the reinsurance will cease on the date of such termination.
d. PLAN CHANGES. If a reinsured policy is changed to another plan of insurance that is not currently
reinsured under this Agreement as defined in Schedule A, then the reinsurance, with respect to the
reinsured policy, under this Agreement will cease as of the effective date of the change.
If a policy that is not reinsured under this Agreement is changed to a plan that is reinsured under
this Agreement as defined in Schedule A and the insured has met THE COMPANY's new business full
underwriting requirements, then reinsurance will commence as of the policy date of the new plan.
e. DEATH BENEFIT OPTION CHANGES. If the death benefit option under a reinsured policy is changed and the
face amount of insurance is either increased or decreased, the net amount at risk reinsured under
this Agreement after the change will be the same as before the change.
22. RECAPTURE
At any time during the term of the Agreement, THE COMPANY may elect to recapture the coverage reinsured
under this Agreement following the occurrence of any of the following events:
1) Material breach by THE REINSURER of any term or condition of this Agreement if such breach is not cured
within a period of at least sixty calendar days following the delivery of notice of such breach
from THE COMPANY to THE REINSURER:
2) THE REINSURER is deemed insolvent as described in Section 25.
3) The occurrence of a "Risk Trigger Event" as defined in Schedule A of this Agreement, provided
that THE REINSURER does not provide additional security as described in Schedule A.
4) A change in reinsurance premium rates that is unacceptable to THE COMPANY in accordance with
Section 13 'REVISION OF PREMIUM RATES'
5) Any written representation or warranty made by THE REINSURER under this Agreement proves to be
untrue in any material respect.
In addition, at any time after the twentieth policy anniversary, THE COMPANY may elect to recapture all
or an appropriate portion of the coverage reinsured under this Agreement to reflect increases in the
maximum retention limits for THE COMPANY and all of its affiliates, collectively, subsequent to the date
of policy issue. These maximum retention limits as of the effective date of this Agreement are equal to
the amounts shown in the Risk Retention Limits table shown in Schedule A. The portion of the coverage
that may be recaptured must be directly related to the increase in the limits. To illustrate, if the
maximum retention limits are increased by 100%, then the portion that may be recaptured from all
reinsurers of the policies reinsured under this Agreement would be equal to 100% of the portion of each
reinsured policy that is retained by THE COMPANY. Furthermore, the portion that may be recaptured from
THE REINSURER would be determined as THE REINSURER's prorata share of the total portion reinsured with
all reinsurers.
If THE COMPANY elects to recapture the risks ceded to THE REINSURER under this Agreement as stated
above, it will do so by giving written notice to THE REINSURER. Upon the delivery of such notice, all
of the risks previously ceded under each of the policies subject to this Agreement shall be recaptured,
effective as of the date specified in THE COMPANY's notice. If THE COMPANY does not specify in the
written notice the date that such recapture is to be effective, then the recapture shall be effective
immediately upon THE REINSURER's receipt of the notice.
If a policy is recaptured, THE REINSURER will pay THE COMPANY the unearned reinsurance premium within 30
days following the date of recapture. THE REINSURER shall not be liable, under this Agreement, for any
claims incurred after the date of recapture, but shall remain liable for all claims incurred on or prior
to the date of recapture.
No exercise by THE COMPANY of any recapture right will give rise to any claims for damages, lost
profits, or other form of compensation to THE REINSURER, other than payment of a prorated sum for any
amount that might be due and owing under the reinsurance treaty up to the effective date of the
recapture.
23. REINSTATEMENTS
a. AUTOMATIC REINSTATEMENT. If THE COMPANY reinstates a policy that was originally ceded to THE
REINSURER as automatic reinsurance using conventional underwriting practices, THE REINSURER's
reinsurance for the policy shall be reinstated.
b. FACULTATIVE REINSTATEMENT. If THE COMPANY has been requested to reinstate a policy that was
originally ceded to THE REINSURER as facultative reinsurance and the reinstatement is processed
under THE COMPANY's Long Form Reinstatement Process, then THE COMPANY will re-submit the
appropriate evidence for the case to THE REINSURER for underwriting approval before the
reinsurance can be reinstated.
c. PREMIUM ADJUSTMENT. Reinsurance premiums for the interval during which the policy was lapsed will be
paid to THE REINSURER by THE COMPANY.
24. ERRORS AND OMISSIONS
If either THE REINSURER or THE COMPANY fails to comply with any of the terms of this Agreement and it is
shown that the failure was unintentional or the result of a misunderstanding or an administrative
oversight on the part of either party, this Agreement will remain in effect. If the failure to comply
changes the operation or effect of this Agreement, both parties will be put back to the positions they
would have occupied if the failure to comply had not occurred. This section will not apply to any
facultative submission until THE COMPANY has mailed the Notification of Reinsurance form to THE
REINSURER.
25. INSOLVENCY
For the purpose of this Agreement, THE COMPANY or THE REINSURER shall be deemed "insolvent" if it does
one or more of the following occurs:
a. A court-appointed receiver, trustee, custodian, conservator, liquidator, government official or similar
officer takes possession of the property or assets of either THE COMPANY or THE REINSURER; or
b. Either THE COMPANY or THE REINSURER is placed in receivership, rehabilitation, liquidation,
conservation, bankruptcy or similar status pursuant to the laws of any state or of the United
States; or
c. Either THE COMPANY or THE REINSURER becomes subject to an order to rehabilitate or an order to liquidate
as defined by the insurance code of the jurisdiction of the domicile of THE COMPANY or THE
REINSURER, as the case may be.
In the event of the insolvency of THE COMPANY, all reinsurance ceded, renewed or otherwise becoming
effective under 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 without diminution because of the insolvency of THE COMPANY. It is
understood, however, that in the event of the insolvency of THE COMPANY, the liquidator or receiver or
statutory successor of the insolvent Company shall give written notice of the pendency of a claim
against THE COMPANY on the policy reinsured within a reasonable time after such claim is filed in the
insolvency proceeding, and during the pendency of such claim THE REINSURER may investigate such claim
and interpose, at its own expense, in the proceeding where such claim is to be adjudicated any defense
or defenses which it may deem available to THE COMPANY or is liquidator or receiver or statutory
successor.
In the event THE REINSURER is deemed insolvent, THE REINSURER will be bound by any legal directions
imposed by its liquidator, conservator, or statutory successor. However, and if not in conflict with
such legal directions, THE COMPANY shall have the right to cancel this Agreement with respect to
occurrences taking place on or after the date THE REINSURER first evidences insolvency. Such right to
cancel shall be exercised by providing THE REINSURER (or its liquidator, conservator, receiver or
statutory successor) with a written notice of THE COMPANY's intent to recapture ceded business. If THE
COMPANY exercises such right to cancel and recapture ceded business, such election shall be in lieu of
any premature recapture fee. Upon such election, THE COMPANY shall be under no obligation to THE
REINSURER, its liquidator, receiver or statutory successor; however, THE REINSURER, its liquidator,
receiver or statutory successor shall be liable for all claims incurred prior to the date of recapture.
26. ARBITRATION
a. GENERAL. All disputes and differences under this Agreement that cannot be amicably agreed upon by the
parties shall be decided by arbitration. The arbitrators will have the authority to interpret this
Agreement and, in doing so, will consider the customs and practices of the life insurance and life
reinsurance industry. The arbitrators will consider this Agreement as an honorable engagement
rather than merely a legal obligation, and they are relieved of all judicial formalities and may
abstain from following the strict rules of law. The arbitration shall take place within the United
States.
b. NOTICE. To initiate arbitration, one of the parties will notify the other, in writing, of its desire to
arbitrate. The notice will state the nature of the dispute and the desired remedies. The party to
which the notice is sent will respond to the notification in writing within 10 days of receipt of
the notice. At that time, the responding party will state any additional dispute it may have
regarding the subject of arbitration.
c. PROCEDURE. Arbitration will be heard before a panel of three disinterested arbitrators. The
arbitrators will be current or former executive officers or employees of life insurance or
reinsurance companies; however, these companies will not be either party or any of their
subsidiaries or affiliates. Each party will appoint one arbitrator. Notice of the appointment of
these arbitrators will be given by each party to the other party within 30 days of the date of
mailing of the notification initiating the arbitration. These two arbitrators will, as soon as
possible, but no longer than 45 days after the date of the mailing of the notification initiating
the arbitration, then select the third arbitrator.
Should either party fail to appoint an arbitrator within 30 business days after the other party has
given written notice of its arbitrator appointment, the party that has given notice of its
arbitrator appointment may appoint the second arbitrator. Should the two initial arbitrators be
unable to agree on the choice of a third arbitrator, each arbitrator will nominate three
candidates, two of whom the other will decline, and the decision will be made by drawing lots on
the final selection. If this candidate declines to serve, then the candidate last eliminated will
be approached to serve. This process will be repeated until a candidate has agreed to serve as the
third arbitrator. Once chosen, the three arbitrators will have the authority to decide all
substantive and procedural issues by a majority vote. The arbitration hearing will be held on the
date fixed by the arbitrators at a location agreed upon by the parties. In no event will this date
be later than 6 months after the appointment of the third arbitrator. The arbitrators will issue a
written decision from which there will be no appeal. Either party may reduce this decision to a
judgment before any court that has jurisdiction of the subject of the arbitration.
d. COSTS. Each party will pay the fees of its own attorneys, the arbitrator appointed by that party, and
all other expenses connected with the presentation of its own case. The two parties will share
equally the cost of the third arbitrator.
27. GOOD FAITH
Each party agrees that all matters with respect to this Agreement require its utmost good faith.
28. REPRESENTATIONS AND WARRANTIES
THE COMPANY represents and warrants to THE REINSURER that it is solvent in all jurisdictions in which it
does business or is licensed. THE REINSURER represents and warrants to THE COMPANY that it is solvent
on a statutory basis in all states in which it does business or is licensed. Each party agrees to
promptly notify the other if it is subsequently financially impaired. Each party affirms that it has
and will continue to disclose all matters material to this Agreement and each cession. Examples of such
matters are a material change in underwriting or issue practices or philosophy, or a change in each
party's ownership or control.
THE COMPANY represents and warrants the following:
a. It is a corporation duly organized, existing and in good standing under the laws of Arizona.
b. It is empowered under applicable laws and by its charter and bylaws to enter into and perform the duties
contemplated in this Agreement.
c. It has taken all requisite corporate proceedings to authorize it to enter into and perform the duties
contemplated in this Agreement.
d. It has obtained any and all regulatory approvals as may be required for THE COMPANY to cede the Policies
covered hereunder.
e. It will take no unauthorized action that would encourage the policyholders whose policies are reinsured
under this Agreement to surrender, reduce or otherwise terminate their existing coverages either
through direct or indirect acts, including but not limited to, a plan of internal replacement,
without the consent of THE REINSURER.
f. THE COMPANY acknowledges that THE REINSURER is entering into this Agreement in reliance upon these
representations and warranties of THE COMPANY.
THE REINSURER represents and warrants the following:
a. It is a corporation duly organized, existing and in good standing under the laws of Georgia.
b. It is empowered under applicable laws and by its charter and bylaws to enter into and perform the duties
contemplated in this Agreement.
c. It has taken all requisite corporate proceedings to authorize it to enter into and perform the duties
contemplated in this Agreement.
d. It has obtained any and all regulatory approvals as may be required for THE REINSURER to provide the
reinsurance covered hereunder.
e. As part of THE COMPANY's due diligence process, THE REINSURER has provided a completed copy of the
Reinsurance Carrier Fact Sheet, a copy of which is attached in Schedule G. Each and every year,
upon request by THE COMPANY and after THE REINSURER has completed the Annual Statement, THE
REINSURER will update the information included in The Reinsurance Carrier Fact Sheet. In addition,
from time to time, THE REINSURER will update the information included in the Carrier Fact Sheet as
requested by THE COMPANY. The information included in the Reinsurance Carrier Fact Sheet is true
and accurate as of the date shown on the Fact Sheet.
f. THE REINSURER acknowledges that THE COMPANY is entering into this Agreement in reliance upon these
representations and warranties of THE REINSURER, and THE REINSURER agrees that THE COMPANY's right
of recapture under Section 22 of this Agreement will be triggered if, at any point in the future
during the term of this Agreement, these representations and warranties are no longer true and
correct.
29. CONFIDENTIALITY
THE REINSURER agrees to regard and preserve as confidential all information and material which is
related to THE COMPANY's business and/or customers that may be obtained by THE REINSURER from any source
as a result of this Agreement. THE REINSURER will not, without first obtaining THE COMPANY's prior
written consent disclose to any person, firm or enterprise, or use for its own benefit or for the
benefit of any third party any Company Confidential Information or Company Customer Information except
as necessary for retrocession purposes, external auditors, as required by court order, or as required by
law or regulation. "Company Confidential Information" includes, but is not limited to any and all
financial data, statistics, programs, research, developments, information relating to THE COMPANY's
insurance and financial products, planned or existing computer systems architecture and software, data,
and information of THE COMPANY as well as third party confidential information to which THE COMPANY has
access. "Company Customer Information" includes all information provided by or at the direction of THE
COMPANY about a customer of THE COMPANY or its affiliates, including but not limited to name, address,
telephone number, email address, account or policy information, and any list or grouping of customers.
Notwithstanding the foregoing, the provisions of Section 29 shall not apply with respect to disclosing
of the Product, the Specifications and/or Company Confidential Information which is already known to THE
REINSURER or is or becomes publicly known through no wrongful act of THE REINSURER; or is received from
a third party without similar restriction and without breach of this Agreement; or is independently
developed by THE REINSURER; or is approved for release by written authorization of THE COMPANY; or is
placed in or becomes part of the public domain pursuant to or by reason of operation of law. The
REINSURER shall be allowed to use the experience under this Agreement to perform experience studies
(mortality, lapse, etc.) provided that the information is aggregated or is otherwise not identified as
being business ceded from THE COMPANY. The foregoing exceptions do not apply to the disclosure of
Company Customer Information, which may not be disclosed without THE COMPANY's prior written consent
except as noted in the paragraph preceding this one.
The provisions of this Section 29 regarding Company Confidential Information shall survive the
termination of the parties' obligations under this Agreement for a period of two years, and the
provisions of this Section 29 regarding Company Customer Information shall survive the termination of
the parties' obligations under this Agreement for a period of five years.
THE REINSURER certifies that it has implemented and will maintain an effective information security
program to protect THE Company's Customer Information, which program includes administrative, technical,
and physical safeguards:
(a) to ensure the security and confidentiality of Customer Information;
(b) to protect against any anticipated threats or hazards to the security or integrity of such
Customer Information and,
(c) to protect against unauthorized access to or use of Customer Information which could result in
substantial harm or inconvenience to THE COMPANY or its affiliates, or to customers of any of
them..
In the event that Company Confidential Information or Company Customer Information in THE REINSURER's
possession is disclosed to an unauthorized third party, THE REINSURER shall immediately advise THE
COMPANY and take steps to prevent further disclosure.
30. MEDICAL INFORMATION BUREAU
THE REINSURER is required to strictly adhere to the Medical Information Bureau Rules, and THE COMPANY
agrees to abide by these Rules, as amended from time to time. THE COMPANY will not submit a preliminary
notice, application for reinsurance, or reinsurance cession to THE REINSURER unless THE COMPANY has a
signed, currently required Medical Information Bureau authorization.
31. GOVERNING LAW
This Agreement shall be governed by the laws of Arizona without giving effect to the principles of
conflicts of laws thereof.
32. ASSIGNMENT
This Agreement is not assignable by either party except by the express written consent of the other.
33. ACCESS TO RECORDS
THE REINSURER and THE COMPANY, or their duly authorized representatives, will have the right to inspect
original papers, records, and all documents relating to the business reinsured under this Agreement
including underwriting, claims processing, and administration. Such access will be provided during
regular business hours at the office of the inspected party. THE COMPANY will be obligated to provide
access to all of THE COMPANY's original papers, records and documents relating to the business reinsured
under this Agreement and will take all necessary measures to ensure that it can fulfill this requirement.
34. SEVERABILITY
If any provision of this Agreement is determined to be invalid or unenforceable, such determination will
not impair or affect the validity or the enforceability of the remaining provisions of this Agreement.
35. REINSURANCE ADMINISTRATION
THE COMPANY shall perform all duties with respect to the administration of the reinsurance under this
Agreement on the portion of the policies reinsured under this Agreement.
36. NONWAIVER
No forbearance on the part of either party to insist upon compliance by the other party with any of the
terms of this Agreement shall be construed as, or constitute a waiver of, any of the terms of this
Agreement.
37. COUNTERPARTS
This Agreement may be executed simultaneously in any number of counterparts, each of which shall be
deemed an original, but all of which shall constitute one and the same instrument.
38. FINANCIAL REPORTS
Upon request, each party shall furnish to the other its respective NAIC Convention Blank Statements, as
required by their respective state laws, within fifteen days after such request.
39. OFFSET
Any debts or credits, in favor of or against either THE REINSURER or THE COMPANY with respect to this
Agreement or any other agreement between the parties are deemed mutual debts or credits and may be
offset and only the balance will be allowed or paid.
The right of offset will not be affected or diminished because of the insolvency of either party.
40. SURVIVAL
Sections 24, 28 and 29 of this Agreement shall survive the recapture, termination or expiration of this
Agreement.
41. SERVICE OF SUIT
Each party's agent for service of process is authorized and directed to accept service of process on
behalf of such party in any such suit and/or, upon the request of the other party, to give a written
undertaking to that party that the agent for service of process will enter a general appearance on
behalf of that party in the event that such a suit shall be instituted. THE REINSURER hereby designates
the Superintendent, Commissioner or Director of Insurance or his successor or successors in office, for
the State of Arizona, as its true and lawful attorney upon whom may be served any lawful process in any
action, suit or proceeding instituted by or on behalf of THE COMPANY arising out of this Agreement, and
hereby designates the agent for service of process as the firm to whom said officer is authorized to
mail such processor a true copy thereof.
42. NOTICES
All notices and other communications under this Agreement will be effective when received and sufficient
if given in writing and delivered by confirmed facsimile transmission, by certified or registered mail,
or by an overnight delivery service of general commercial use (such as UPS, Federal Express or
Airborne), addressed to the attention of the applicable party described as follows, or any successor
thereof:
a. NOTICES SENT TO THE COMPANY
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Pruco Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
b. NOTICES SENT TO THE REINSURER
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
2nd VP and Actuary
Munich American Reassurance Company
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
In witness of the above, THE COMPANY and THE REINSURER have by their respective officers executed and
delivered this Agreement in duplicate on the dates indicated below, with an effective date of December 15,
2003.
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PRUCO LIFE INSURANCE COMPANY MUNICH AMERICAN REASSURANCE COMPANY
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By:________________________________ By:______________________________
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Title:_______________________________ Title:_____________________________
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Date:_______________________________ Date:_____________________________
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By:________________________________ By:______________________________
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Title:_______________________________ Title:_____________________________
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Date:_______________________________ Date:_____________________________
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Y-MPVUL-2003-MUNICH (PRUCO'S 50%)-PLAZ