EXHIBIT 1A(9)(ii)
SERVICE AGREEMENT
This Application Solutions Services Agreement ("Agreement") is deemed effective
as of the 1st day of May, 1999, and is entered into by and between PMSI
Services, Inc. ("PMSI") a Corporation having its principal place of business at
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ and Sage Life Assurance of America, Inc.,
("Customer") with its principal place of business at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
PMSI and Customer agree as follows:
1. TERM:
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1.1 1.1 The term of this Agreement shall commence upon the effective date in
the first paragraph of this Agreement and shall continue through December
31, 2001.
2. PMSI'S SERVICES:
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2.1 Implementation Period The "Implementation Period" shall begin on this
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Agreement's effective date and will end on the date PMSI notifies
Customer that PMSI has completed implementing the automated portion of
the services to be provided hereunder. During the Implementation Period,
PMSI shall prepare to perform the "Application Solutions Services" as
defined below. These Preparation Services will include creating
electronic images of Customer's pre-approved insurance applications,
appropriate state variations, consent forms and paramedical forms. All
Preparation Services will be performed in accordance with the assumptions
and limitations delineated in Exhibit I to this Agreement. Customer shall
assist PMSI during the Implementation Period by gathering the appropriate
data information, background, and other facts and approvals as needed to
enable PMSI to perform the Preparation Services and Application Solutions
Services pursuant to this Agreement and providing such to PMSI.
2.2 Application Solutions Services:
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Application Services and Application Solutions Services shall mean: Upon
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PMSI's notifying Customer that PMSI is ready to commence receiving life
insurance applications on behalf of Customer and Customer's subsidiary
life insurance company, Sage Life Assurance Company of New York ("Sage
NY"), PMSI will receive names, phone numbers, addresses and other
relevant information of a prospective insured directly from Customer or
insurance producers appointed by Customer ("Producers"), including the
signature of each prospective insured authorizing the commencement of the
Application Services process and access to the medical records of each
prospective insured. PMSI will order an MIB inquiry and if the MIB search
results are clear (indication of no record), PMSI will notify Customer's
Producer and a binding agreement ("Quick Issue Report") will be sent to
the Producer by PMSI on behalf of Customer, subject to Customer's
underwriting limits provided to PMSI in writing. If the MIB search
results in a hit (indication of impairment or other adverse condition),
PMSI will contact the Producer to facilitate the scheduling of a
telephone interview with prospective insureds. Through telephone
interviews, PMSI shall elicit necessary information to prepare an
Application Report regarding applicants. PMSI will order on behalf of
Customer other third party information gathering services, and Customer
shall pay such third parties directly for such services. PMSI will either
forward electronically or print and mail a copy of each Application
Report and other required forms approved by Customer to a paramedic
organization from list set forth on Exhibit II to this Agreement. After
the paramedic organization receives the documents from PMSI, the
paramedic organization will contact the prospective insured for the
standard paramedic services in gathering data to be utilized by PMSI in
making its Underwriting Recommendation with respect to the prospective
insured. The paramedic organization will be responsible for having each
prospective insured review and sign the Application Report. The paramedic
organization will then return all the completed applications and forms to
PMSI. PMSI will review the Application Report returned by the paramedic
organization and PMSI will then perform certain ministerial functions
pursuant to Customer's written underwriting guidelines provided to PMSI,
and prepare an Underwriting Recommendation ("Underwriting
Recommendation"), if necessary. The completed Application Report and
Underwriting Recommendation will be forwarded to Customer's third party
administrator, ("TPA"), for the TPA to perform policy issue and delivery
or take other appropriate action if policy issue is not recommended. PMSI
will provide all adverse underwriting action notifications directly to
prospective insureds (by way of form letters preapproved by Customer) and
shall notify TPA of each such action promptly thereafter.
2.3 Claims Services shall mean: Upon appropriate notification of an insurance
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claim from the Customer, PMSI will forward a claimant statement to the
beneficiary for completion. PMSI will notify all appropriate parties
including the TPA and reinsurer and request the original policy file.
PMSI will review the file to determine Customer's requirements to process
the claim. If the claim is within the contestable period, PMSI may order
on behalf of Customer other third party information gathering services in
PMSI's discretion, and Customer shall pay such third parties directly for
such services. After review of the complete file, PMSI will prepare a
Claim Recommendation and forward to TPA for payment or declination.
2.4 PMSI will provide the Telepro services as provided in Exhibit III
attached hereto.
3. DUTIES OF CUSTOMER
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3.1 Customer shall provide the data necessary, in a timely way and in a
format acceptable to PMSI, for PMSI to perform the Application Solutions
Services.
3.2 Apart from those Claims Services specifically described in subsection 2.3
Customer acknowledges that PMSI assumes no risk or responsibility for
Customer's claims administration, claim payment, or claim recovery.
3.3 Customer acknowledges that PMSI assumes no insurance risk for any of
Customer's policyholders/insureds or any of the parties named in this
Agreement.
3.4 Customer will provide PMSI with the information and specifications
necessary to perform the Application Solutions Services and Claims
Services, including but not limited to paramedic organizations, corporate
and subsidiary logos (if applicable), style and specifications of printed
documents such as insurance pre-applications and applications, and all
other information and specifications necessary to perform the Application
Solutions Services and Claims Services.
3.5 Customer shall appoint a project manager with sufficient authority within
Customer's organization to facilitate Customer's role as PMSI performs
the Application Solutions Services and Claims Services.
3.6 Customer shall be responsible for entering all agreements with the
paramedic organizations listed on Exhibit II hereto. The paramedic
organizations will invoice Customer for performing paramedic services for
Customer. PMSI is not responsible for electing to utilize one paramedic
organization over another, and is merely acting as Customer's agent in
this context. PMSI shall not be responsible to Customer for any acts or
omissions to act of the paramedic organizations.
4. AUDIT PROVISIONS
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4.1 PMSI shall maintain records of the Application Solutions Services
performed on behalf of Customer hereunder in accordance with generally
accepted accounting practices. In addition, PMSI shall maintain records
of the data utilized to perform the Application Solutions Services until
two (2) years following the earlier of: (i) the date of final payment for
the Application Solutions Services with respect to such records are
maintained, or (ii) the period to which such data relates, unless such
records are earlier returned to Customer. At Customer's expense, Customer
and an auditor selected by Customer may have access to such records
retained by PMSI relative to the Application Solutions Services performed
by PMSI on behalf of Customer upon 10 days prior written notice for the
purposes of verifying PMSI's compliance with Customer's underwriting
guidelines during normal business hours during the full term of this
Agreement and during the respective periods in which PMSI is required to
maintain such records.
4.2 As necessary as determined by PMSI, PMSI shall have the right, at its
expense and upon ten (10) days prior written notice to Customer to audit
Customer-provided facts and figures in order to independently verify any
information provided by Customer. Such audit will occur during Customer's
normal business hours.
5. PRICE AND PAYMENT
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5.1 Customer agrees to pay PMSI the following amounts in consideration of
PMSI's performing the services herein.
5.2 Customer shall pay PMSI monthly insurance application processing charges
for the Quick Issue Reports, Application Reports, and Underwriting
Recommendations requested by Customer or Producers. The insurance
application processing charges shall equal the number of various reports
and recommendations provided in a month times the applicable Charge-per-
Report. Quick Issue Reports shall be deemed serviced and a Charge-per-
Quick Issue Report equal to $24.00 shall apply when PMSI completes and
forwards each such Quick Issue Report to Customer or Producer. For each
Application Report required but not concluded, Customer shall pay PMSI a
minimum Charge-per-Application Report of $20.00 upon termination by PMSI
of its efforts to contact each such prospective insured. Application
Report requests shall be deemed serviced and a Charge-per-Application
Report equal to $45.00 per Application Report shall apply when PMSI
completes an interview with an insurance applicant. When PMSI is required
to perform multiple interviews for an Application Report, Customer shall
pay PMSI a Charge-per-Application Report equal to $45.00 for completion
of each interview. A charge equal to $35.00 shall apply to each
Underwriting Recommendation provided relating to an Application Report.
5.3 A charge equal to $35.00 shall apply to each Claim Recommendation
provided.
5.4 In consideration for the Preparations Services, as described in Section
2.1 and Exhibit I a surcharge of $23.00 shall be assessed to each Quick
Issue Report and to each Application Report for the first 3,600 of such
reports provided by PMSI.
5.5 For the purposes of this Agreement, "Quarter" shall mean three (3)
consecutive calendar months of a calendar year. The first Quarter under
this Agreement shall commence on May 1, 1999. On or before the 15th day
of each Quarter, Customer shall provide PMSI with a written projection of
the number of all Services which Customer estimates it will order from
PMSI during each month of such Quarter. Notwithstanding anything to the
contrary, Customer agrees to order an aggregate Minimum Amount of
Services during each Quarter of this Agreement that will equal or exceed
as follows:
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Quarter Dollar Amount
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Quarter I $ 6000.00
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Quarter 2 $ 8,000.00
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Quarter 3-12 $12,000.00
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Customer agrees to pay and shall be invoiced for actual amount ordered
plus the difference between the aggregate Minimum Amount and the
aggregate actual amount ordered in all Quarters. These Minimum Amount
requirements shall not apply prior to May 1, 1999.
5.6 For PMSI's providing Preparation Services during the Implementation
Period which go beyond those described in Section 2.1 and Exhibit I, and
any other business or computer consulting analysis, programming or
training necessary hereunder, or resulting from statutory or regulatory
change, Customer shall pay PMSI on a time and materials basis at the rate
of $8,500.00 per person month during the term of this Agreement, or an
equitable fraction thereof for Preparation Services rendered in lesser
increments of time.
5.7 Customer shall pay PMSI under this Agreement on a monthly basis as any
and all of the services hereunder are performed and invoiced by PMSI. All
amounts due PMSI are stated and payable in United States currency.
Customer shall pay a late charge on any amount which remains unpaid after
thirty days of PMSI's mailing of PMSI's invoice. The late charge shall be
computed daily at the lesser of (i) 1.5% per month, or (ii) the highest
rate permitted by law.
5.8 In the event a communications, hardware or postal vendor supplying a
service or product to PMSI required for PMSI to provide the Application
Solutions Services to Customer increases its rates charged to PMSI, PMSI
may increase the contracted rates set forth herein by an amount not
exceeding the amount of such increases.
5.9 The Application Solutions Services rates may increase if changes in the
Applications Solutions Services mutually agreed to in writing
substantially alter the servicing personnel, equipment, or result in the
servicing being done.
5.10 When Customer requests PMSI personnel to travel to any location for the
purpose of performing work under this Agreement, Customer will, in
addition to the charges specified herein, pay PMSI for all reasonable
travel, living, and out-of-pocket expenses. In
addition to the charges specified herein, Customer shall pay PMSI for any
telecommunication, data center,and data transfer charges, and all other
charges, which PMSI incurs while performing any work specific to Customer
under this Agreement.
5.11 Customer agrees to pay all tariffs and taxes that are now or may become
applicable to the services rendered hereunder, any equipment used by PMSI
solely to service Customer, the communication lines, PMSI's transmission
of data, and any communications equipment use, lease, operation, control,
transportation or value in connection with this Agreement, or as measured
by payments made by Customer to PMSI under this Agreement, or as required
to be collected by PMSI or paid by PMSI to tax authorities based upon
PMSI's Agreement with Customer. This provision includes but is not
limited to sales, use, and personal property taxes, or any other form of
tax based on services performed, equipment used, and the communication or
storage of data, but does not include taxes based upon the net income of
PMSI.
5.12 Customer shall pay PMSI at the following rates in consideration for
PMSI's providing Customer with the Telepro and Telepro Plus Reports as
shown Exhibit III:
(i) When records are received from a medical facility, Customer shall pay
PMSI for each Telepro Report a service fee of $20.00 plus any medical
record fee and/or search fee charged to PMSI by the medical facility
providing the records. PMSI shall not enter into any agreement for the
payment of medical record or search fees except as an agent for
Customer; Customer acknowledges that Customer is responsible for the
ultimate settlement of all medical record and search fees incurred
pursuant to this Agreement.
(ii) In the event records are not received from a medical facility, Customer
shall pay PMSI a service fee of $12.00 for each Telepro Report that
indicates no record; and
(iii) Customer shall pay PMSI a service fee of $12.00 for each Telepro Plus
Report that is ordered in connection with a Telepro Report.
6. LICENSE, TRADE SECRET AND PROPRIETARY RIGHTS
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6.1 This Agreement grants to Customer no right to possess or reproduce the
computer software programs performing all or any part of the Application
Services or their specifications including the Platform (collectively
referred to herein as ("Software") in any tangible or intangible medium.
In the event Customer shall come into possession of any of the Software,
Customer shall immediately notify PMSI and return the Software and all
copies of any kind thereof to PMSI upon PMSI's request. Customer may not
mortgage, hypothecate, sell, assign, pledge, lease, use, transfer,
license or sublicense the Software nor allow any person, firm or
corporation to transmit, copy, or reproduce the Software in whole or in
part in any manner.
6.2 In the event Customer gains access to any of the Software, Customer
promises and agrees not to use, or disclose or otherwise make any of the
Software available to any person, other than employees of Customer
required to have such knowledge for the sole purpose of utilizing the
Application Solutions Services hereunder. Customer agrees to obligate
each such employee to a level of care sufficient to protect the Software
from unauthorized disclosure. THE OBLIGATIONS OF CUSTOMER UNDER THIS
ARTICLE SHALL CONTINUE AFTER THIS AGREEMENT IS TERMINATED.
6.3 PMSI promises and agrees not to disclose or otherwise make information
concerning Customer's clients', insureds', and beneficiaries' identities,
claims, medical records, benefits, rates, agents, financial information
or specific product information ("Confidential Information") available to
any person other than to Customer, Customer's employees and Producers or
other parties required to receive disclosure to enable PMSI to perform
Application Solutions Services and Claims Services under this Agreement,
subject to applicable law. PMSI agrees to obligate PMSI's employees
receiving disclosure to a level of care sufficient to protect Customer's
Confidential Information. THE OBLIGATIONS OF PMSI UNDER THIS ARTICLE
SHALL CONTINUE AFTER THIS AGREEMENT IS TERMINATED.
7. TERMINATION
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7.1 During the first 12 full months of this Agreement and thereafter, either
party may
terminate this Agreement only for cause because of a material breach by
the other party of any one or more of the terms and conditions of this
Agreement, provided the party in breach is notified in writing by the
other party of the breach, and the breach is not cured or a satisfactory
resolution is not agreed upon in writing within thirty (30) days of such
written notification. After the first 12 full months of this Agreement,
Customer may terminate this Agreement without cause if Customer gives
PMSI at least six (6) months prior written notice of termination and
simultaneously pays PMSI any outstanding amounts owed for Preparation
Services as described in Section 5.4 plus a simple interest rate of the
then current prime rate plus two percent.
7.2 In the event either party makes a general assignment for the benefit of
creditors or files a voluntary petition in bankruptcy or petitions for
reorganization or arrangement under the bankruptcy laws, or if a petition
in bankruptcy is filed against either party and remains undismissed for a
period of thirty (30) days, or if a receiver or trustee is appointed for
all or any part of the property and assets of either party, the other
party may immediately terminate this Agreement.
8. LIMITATION OF LIABILITY AND REMEDIES
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8.1 IF DATA IS PROCESSED IN ERROR DUE TO AN ERROR OR DEFECT IN ANY SERVICE
PROVIDED BY PMSI, THEN UPON PMSI RECEIVING NOTICE OF SUCH ERROR OR
DEFECT, PMSI SHALL REPROCESS SUCH DATA WITHOUT CHARGE TO CUSTOMER.
8.2 EXCEPT FOR VIOLATIONS OF THE CONFIDENTIALITY OBLIGATIONS SET FORTH IN
SECTION 6 OF THIS AGREEMENT, PMSI'S TOTAL AGGREGATE LIABILITY FOR DAMAGES
ARISING FROM BREACHES OF THIS AGREEMENT AND ERRORS, OMISSIONS AND DEFECTS
IN THE ANY SERVICES (WHETHER IN TORT OR CONTRACT, LAW OR EQUITY) SHALL BE
LIMITED TO AN AMOUNT NOT TO CUMULATIVELY EXCEED $300,000.00.
8.3 THE PARTIES AGREE THAT THIS IS A SERVICES AGREEMENT, AND THAT EXCEPT AS
EXPRESSLY STATED IN THIS AGREEMENT, THERE ARE NO OTHER RIGHTS, REMEDIES,
OR WARRANTIES INCLUDING BUT NOT LIMITED TO, ANY EXPRESS OR IMPLIED
WARRANTIES OF MERCHANTABILITY, FITNESS OR FITNESS FOR A PARTICULAR
PURPOSE, ALL OF WHICH ARE HEREBY DISCLAIMED.
8.4 EXCEPT FOR VIOLATIONS OF THE CONFIDENTIALITY OBLIGATIONS SET FORTH IN
SECTION 6 OF THIS AGREEMENT, NEITHER PMSI NOR CUSTOMER SHALL BE LIABLE
FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT
LIMITED TO LOST PROFITS, PAYMENTS TO THIRD PARTIES, COST OF COVER OR
OTHER ECONOMIC LOSS ARISING OUT OF THIS AGREEMENT OR ANY SERVICES WHETHER
SUCH LIABILITY ARISES IN CONTRACT OR TORT (INCLUDING NEGLIGENCE), LAW OR
EQUITY, OR OTHERWISE.
8.5 PMSI SHALL NOT BE LIABLE OR DEEMED TO BE IN DEFAULT FOR ANY DELAY OR
FAILURE IN PERFORMANCE UNDER THIS AGREEMENT OR INTERRUPTION OF SERVICE
RESULTING, DIRECTLY OR INDIRECTLY, FROM ACTS OF GOD, CIVIL OR MILITARY
AUTHORITY, LABOR DISPUTES, SHORTAGES OF SUITABLE PARTS, MATERIALS, LABOR
OR TRANSPORTATION, OR ANY SIMILAR EVENT BEYOND THE REASONABLE CONTROL OF
PMSI.
8.6 CUSTOMER AGREES TO INDEMNIFY, DEFEND, AND HOLD PMSI HARMLESS FROM ANY
LIABILITY, LOSS, COST, CLAIM OR DAMAGE SUFFERED BY PMSI RELATIVE TO
PERSONAL INJURY OR PROPERTY DAMAGE (INCLUDING LEGAL EXPENSES AND
ATTORNEY'S FEES), CAUSED BY THE NEGLIGENCE OR MISCONDUCT OF CUSTOMER
AND/OR ITS DIRECTORS OR EMPLOYEES, AND CUSTOMER'S CLAIM ADMINISTRATION,
PAYMENT, AND RECOVERY PROCESS, EXCEPT TO THE EXTENT OF PMSI'S INVOLVEMENT
IN CUSTOMER'S CLAIM ADMINISTRATION, PAYMENT AND RECOVERY PROCESSES.
8.7 SUBJECT TO ARTICLES 8.1, 8.2, 8.3, 8.4, AND 8.5 HEREIN PMSI AGREES TO
INDEMNIFY, DEFEND, AND HOLD CUSTOMER HARMLESS FROM ANY LIABILITY, LOSS,
COST, CLAIM OR DAMAGE SUFFERED BY CUSTOMER (INCLUDING LEGAL EXPENSES AND
ATTORNEY'S FEES), CAUSED BY THE NEGLIGENCE OR MISCONDUCT OF PMSI AND/OR
ITS DIRECTORS OR EMPLOYEES.
8.8 IF A THIRD PARTY CLAIMS THAT ANY SOFTWARE SUPPLIED BY PMSI, IF ANY,
INFRINGES ON A TRADEMARK, SERVICE ▇▇▇▇, COPYRIGHT OR PATENT, PMSI WILL
INDEMNIFY AND DEFEND CUSTOMER AND HOLD CUSTOMER HARMLESS AGAINST THAT
CLAIM, PROVIDED CUSTOMER HAS LAWFUL POSESSION OF THE SOFTWARE, HAS NOT
DIRECTLY OR INDIRECTLY CAUSED SUCH CLAIM TO ARISE, AND NOTIFIES PMSI IN
WRITING AS SOON AS REASONABLY POSSIBLE AFTER CUSTOMER BECOMES AWARE OF
SUCH CLAIM OR ALLEGATION OF TRADEMARK, SERVICE ▇▇▇▇, COPYRIGHT OR PATENT
INFRINGEMENT. PMSI WILL CONTROL THE DEFENSE OF THE INFRINGEMENT CLAIM;
HOWEVER, PMSI AGREES THAT THE DEFENSE OF THE INFRINGEMENT SUIT OR CLAIM
WILL ALSO PROTECT THE INTERESTS OF CUSTOMER. ANY SETTLEMENT OF THE
INFRINGEMENT SUIT OR CLAIM WILL INCLUDE CUSTOMER.
8.9 IF ANY DISPUTE ARISES RELATED TO THIS AGREEMENT OR ANY TRANSACTION
GOVERNED BY IT, SENIOR EXECUTIVES OF BOTH PARTIES, WITH AUTHORITY TO
SETTLE THE DISPUTE WILL MEET TO ATTEMPT TO RESOLVE THE DISPUTE BEFORE
RESORTING TO FORMAL LEGAL ACTION. THIS MEETING WILL BE HELD REASONABLY
PROMPTLY AT THE REQUEST OF EITHER PARTY IN THE OFFICES OF THE
NONREQUESTING PARTY.
8.10 CUSTOMER AND PMSI AGREE THAT THIS ARTICLE SHALL SURVIVE THE TERMINATION
OF THE AGREEMENT.
9. GENERAL
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9.1 Customer and PMSI agree that while this Agreement is in effect, neither
will directly or indirectly induce any employee of the other to terminate
his or her employment; nor will either, without the prior written consent
of the other, knowingly offer employment to any employee of the other, or
to former employees during the six (6) month period immediately following
such employee's termination.
9.2 All notices which are required to be given or submitted pursuant to this
Agreement shall be in writing and shall be either delivered in person or
sent by certified mail, return receipt requested, to the address set
forth herein or to such other address as the parties may from time to
time designate in writing for such purposes. Notices shall be deemed to
have been given at the time when personally delivered or, if mailed in a
certified post-paid envelope, upon the fifth day after the date such
notice shall be postmarked. All notices to PMSI shall be addressed to the
attention of the Executive Vice President. All notices to Customer shall
be addressed to the attention of the President.
9.3 Each party covenants and promises not to issue press releases or disclose
the terms and conditions of this Agreement to any third party, except as
required by a court of law or as expressly consented to by the other
party, which consent shall not be unreasonably withheld.
9.4 This Agreement and the Exhibits attached hereto are incorporated by
reference herein, and making a part hereof: (a) constitute the entire
Agreement between the parties and supersede and merge any and all prior
discussions, representations, negotiations, correspondence, writings and
other agreements and together state the entire understanding and
Agreement between PMSI and Customer with respect to the services
described herein; (b) may be amended or modified only in writing agreed
to and signed by PMSI and Customer; and (c) shall be deemed to have been
entered into and executed in the State of Texas and shall be construed,
performed and enforced in all respects in accordance with the laws of
that State without regard to its conflict of law provisions.
9.5 Neither party hereto shall be deemed to have waived any rights or
remedies accruing to it hereunder unless such waiver is in writing and
signed by such party. No delay or omission by either party hereto in
exercising any right shall
operate as a waiver of said right on any future occasion. All rights and
remedies hereunder shall be cumulative and may be exercised singularly or
concurrently.
9.6 The descriptive headings of this Agreement are intended for reference
only and shall not affect the construction or interpretation of this
Agreement.
9.7 Wherever the singular if any term is used herein it shall be deemed to
include the plural wherever the plural thereof may be applicable.
9.8 Customer shall not assign this Agreement or any of its rights hereunder
without the prior written consent of PMSI.
9.9 If any provision of this Agreement or any Exhibit hereto or the
application thereof to any party or circumstances shall, to any extent,
now or hereafter be or become invalid or unenforceable, the remainder of
this Agreement shall not be affected thereby and every other provision of
this Agreement shall be valid and enforceable to the fullest extent
permitted by law.
9.10 All underwriting and claims files relating to applicant, insureds,
prospective insureds, contractowners, beneficiaries and claimants,
whether developed by PMSI or delivered to PMSI by Customer for provision
of Services, shall be and remain the property of Customer or Sage NY, as
the case may be. PMSI may retain such files for the duration of any
Services it is providing with respect to the file and for ninety (90)
days thereafter. At that point, PMSI shall forward the file and all of
its contents to any person or entity as designated by Customer. Customer
shall bear all shipping costs.
9.11 PMSI shall limit access to the files to those PMSI employees who
reasonably need access to perform the Services described herein. PMSI
shall institute such measures with respect to limitation of access and
confidentiality of medical, genetic testing, alcohol and drug abuse, AIDS
and HIV, and consumer credit records as is necessary to comply with
relevant state and federal law.
9.12 PMSI shall cooperate with Customer to develop and implement procedures
necessary to obtain for Customer access to the services of the Medical
Information Bureau, Inc. ("MIB"). Thereafter, PMSI shall conduct its
activities in the performance of the Services in compliance with
Customer's written Plan of Operation with MIB as such is provided to
PMSI. PMSI shall also cooperate with Customer and MIB with respect to any
internal audits necessary to comply with the MIB Plan of Operations, and
with respect to any audit performed by MIB to monitor Customer's
compliance with its MIB Plan of Operations.
9.13 PMSI shall promptly notify Customer if its operations become the subject
of any investigation or inquiry related to Customer's Confidential
Information by any state of federal regulatory authority having
jurisdiction over persons or entities engaging in the insurance or
securities business. (Such obligation shall not extend to investigations
or inquiries arising out of complaints made by individuals who are
applicants for insurance or insureds or prospective insureds or
beneficiaries or claimants.) To the extent it may be permitted to do so,
PMSI shall share with Customers copies of any reports, recommendations,
orders, subpoenas or other written documents or memoranda relating to
such investigation or inquiry.
9.14 PMSI acknowledges that Customer is developing an internet web site
("Site"), the purpose of which will be to, among other things, (a)
provide general information about Customer and its products, (b) allow
registered representatives, contractowners, and the general public to
access information regarding variable account unit values and offerings
and fixed account interest rate offerings, (c) allow contractowners to
access values and other information regarding their own contracts and
make investment allocations and other changes, and (d) allow registered
representatives and Customer's home office personnel to access
information regarding underwriting status. PMSI agrees to cooperate with
Customer, and any third parties customer has engaged, to enable them to
develop the Site and to provide reasonable access to all of the
information they may need to develop the Site. Furthermore, PMSI agrees
that it will perform the Application Services and Applications Solutions
Services described in Section 2.2 hereof, and the Claims Services
described in Section 2.3 hereof, via the Site and the internet to the
extent Customer has built the capability into the Site, and to the extent
registered representatives and applicants actually use it for its
intended purposes. For any development work related to an Internet web
site performed by PMSI, Sage Life will pay for professional services on a
time and materials basis as described in Section 5.6.
PMSI AND CUSTOMER CERTIFY BY THEIR UNDERSIGNED AUTHORIZED AGENTS THAT THEY HAVE
READ THIS AGREEMENT, INCLUDING ALL EXHIBITS HERETO, AND AGREE TO BE BOUND BY
THEIR TERMS AND CONDITIONS.
PMSI Services, Inc. Sage Life Assurance of America, Inc.
BY: _____________________________ BY: ____________________________
(AUTHORIZED SIGNATURE) (AUTHORIZED SIGNATURE)
(in non-black ink, please) (in non-black ink, please)
_____________________________ ____________________________
(NAME) (NAME)
_____________________________ ____________________________
(TITLE) (TITLE)
_____________________________ ____________________________
(EXECUTION DATE (EXECUTION DATE)
EXHIBIT I
to the
SERVICE AGREEMENT
by and between
PMSI, Services Inc.
and
Sage Life Assurance of America, Inc.
dated effective: January 1, 1999
PREPARATION SERVICES
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Customer agrees to (i) pay PMSI pursuant to Section 5.4 of the Agreement for
Preparation Services described below and in Section 5.2 performed by PMSI and
(ii) pay PMSI pursuant to Section 5.6 of the Agreement for services performed in
addition to the tasks delineated below.
. PMSI will initially establish a Platform for one (1) Single Payment Variable
Life and one (1) Flexible Premium Variable Universal Life product of
Customer. PMSI acknowledges that Customer's riders and benefits include an
Accidental Benefit rider, an Accelerated Death Benefit rider, a Change of
Insured rider and a Waiver of Surrender Charge rider.
. Two (2) applications will be supported with an undetermined number (at this
time) of state forms variations. This estimate is based on supporting two
applications with various state forms variations. Customer will verify and
notify PMSI during the Implementation Period whether PMSI's use of overflow
pages for the risk details on behalf of Customer will be in compliance with
Customer's applications currently approved. This estimate is based on using
overflow pages to print the risk details.
. Customer will work with PMSI to provide the "drill-down" scripts necessary to
interview applicants and gain additional information when necessary. The
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development of these scripts is not included in this cost.
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. Data exported to Customer will be in the PMSI standard export format.
Interface to Customer's new business system, and the costs thereof, is the
responsibility of the Customer. If the Customer requires a customized export
record, an additional 3 to 4 person months may be required in addition to
this estimate.
This estimate does not include the work effort required to perform forms
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composition for Customer.
EXHIBIT II
to the
SERVICE AGREEMENT
by and between
PMSI Services, Inc.
and
Sage Life Assurance of America, Inc.
dated effective: January 1, 1999
APPROVED PARAMEDIC ORGANIZATIONS
--------------------------------
The following are the paramedical organizations Customer has entered into
agreements with for providing paramedical services for Customer pursuant to
the Agreement:
EMSI ▇▇▇▇ ▇▇▇▇▇, ▇▇., President & CEO
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
. Customer reserves the right to amend this list at any time and for any
reason upon providing PMSI a revised copy of this Exhibit II.
EXHIBIT III
TO THE
SERVICE AGREEMENT
By and between
PMSI Services, Inc.
And
Sage Life Assurance of America, Inc.
Dated effective: January 1, 1999
TELEPRO SERVICES
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This Exhibit is incorporated into and made a part of the Application Solutions
Services Agreement between PMSI and Customer.
1. Definitions:
The following words will have the following meanings:
1.1. Telepro Report: A report consisting of Attending Physician Statements
("APS") relating to a potential insured of Customer.
1.2. Telepro Plus Report: A report containing information obtained from
either Customer's insurance agent or an applicant for insurance.
2. Services
2.1. PMSI will receive requests from Customer to provide to Customer APS
from Customer specified medical facilities for potential insureds of
Customer. PMSI will contact the medical facility to verify the
existence of records on the prospective insureds. PMSI will continue
follow-up with the medical facility to obtain the requested records
which constitutes a Telepro Report for up to forty-three (43) days
from the initial request, unless Customer requests further inquiry by
PMSI. PMSI will forward each Telepro Report to Customer via overnight
mail, regular U.S. mail or electronically upon receipt of a record
from the medical facility. Customer agrees to pay PMSI for the mailing
costs incurred by PMSI unless the parties mutually agree otherwise.
3. Customer acknowledges and agrees that PMSI will attempt to utilize
guidelines and criteria as clearly specified in writing by Customer in
providing the ministerial functions under this Agreement, which include but
are not limited to any recommendations made by PMSI, in connection with
PMSI's providing Telepro and Telepro Plus Reports. Customer agrees that
Customer is responsible to make any managerial or discretionary decisions
that may be based on any Telepro and Telepro Plus Report or any
recommendation in a Telepro or Telepro Plus Report. Customer further
acknowledges and agrees that PMSI is not providing any discretionary
functions or services on behalf of Customer hereunder and if Customer is in
the insurance business, PMSI assumes no (i) insurance risk for any of
Customer's policyholders/insureds or (ii) risk or responsibility for
Customer's underwriting decisions, claims administration, claim payment, or
claim recovery.