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Exhibit 10.31
REINSURED: Medical Inter-Insurance Exchange of New Jersey
Of: Two Princess Road
Lawrenceville
New Jersey
TYPE: (1) Excess Cession Contract and (2) Excess Event Protection
arising out Medical and Dental Practitioner Liability and
Hospital and other Health Care Institution Professional Liability
PERIOD: Effective January 1, 1999 covering on a risks attaching basis for
BUSINESS COVERED, and continuous thereafter unless terminated.
Either party may terminate this Agreement at December 31, 1999 or
any December 31 thereafter within 90 days prior written notice.
There shall be no return of unearned premium in respect of risks
attaching during the TERM. REINSURERS shall receive their
respective share of the net ceded premium in respect of risks
attaching during the TERM.
This Agreement will apply to policies written by the Company and
incepting during the term of this Agreement subject to the
maximum period any one policy not to exceed 36 months plus odd
time.
In respect of multi-year risks attaching to this agreement
reinsurance coverage for the full period shall be provided by
those Reinsurers to whom the original net ceded premium has been
allocated regardless of whether agreement is terminated.
BASIS OF
COVERAGE: As per underlying form of coverage, i.e.:
- Loss Occurring During the underlying policy period in respect
of occurrence coverage.
- Claims first made during the underlying policy period in
respect of claims made coverage.
- Following any Retroactive date applicable to risks attaching.
BUSINESS
COVERED: All business underwriters by New Jersey State Medical
Underwriters, Inc. ("Underwriters") and classified by the COMPANY
as Medical and Dental Practitioner Professional Liability,
Umbrella Liability, Hospital and Other Health Care Institution
Professional Liability, and Commercial General Liability
Business, Directors and Officers Liability, Fiduciary Liability,
Managed Care Errors and Omissions Liability, Employment Practice
Liability, Miscellaneous Professional Indemnity (including but
not limited to, Lawyers Professional, Notary Public and
Electronic Data Processors).
This Agreement applies to losses first occurring under occurrence
policies and claims made under claim made policies both in
respect of risks attaching during the TERM. REINSURERS shall be
subject to all of the
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conditions of the Permanent Protection Policies (PPP) or any other
underlying.
EXCLUSIONS: (1) Claims emanating from policies issued by the Company with the
inception dates after the termination date of this contract.
(2) Reinsurance assumed, except Reinsurance assumed from
Lawrenceville Property and Casualty Insurance Co., Inc., MIIX
Insurance Company of New York, Lawrenceville Re, Ltd., or
American Medical Mutual which is underwritten by New Jersey
State Medical Underwriters, Inc. for MIIX.
In addition, this exclusion shall not apply to assumed
reinsurance underwritten by the Company for captives or other
insurance facilities of hospitals and all other Health Care
institutions where the underwriting is through the New Jersey
State Medical Underwriters, Inc.
(3) Financial Guarantee and Insolvency
(4) Insolvency Fund Exclusions Clause.
(5) Nuclear Incidents Exclusion Clause -- Liability Reinsurance
U.S.A. and Canada, except for incident arising from nuclear
medicine.
(6) Pools, Associations, and Syndicates Exclusion Clause.
LIMITS AND
RETENTIONS: A) Medical and Dental Practitioner Professional Liability,
Umbrella Liability, Hospital and other Health Care Institution
Professional Liability and Commercial General Liability
Business.
$65,000,000 each and every loss or event each original policy
plus pro-rata allocated loss adjustment expenses.
and
B) Directors and Officers Liability, Fiduciary Liability, Managed
Care Errors and Omissions Liability and Employment Practice
Liability, Miscellaneous Professional Indemnity (including but
not limited to Lawyers Professional, Notary Public and
Electronic Data Processors
$15,000,000 each and every loss each original policy plus pro-
rata allocated loss adjustment expenses.
Excess of a retention of:
$10,000,000 each and every loss or event each original policy.
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CONDITIONS: (1) 8% coinsurance by the Company in respect of limits provided by
this contract.
(2) Article IV G of the prior contract will not be retained in this
replacement contract.
(3) The Company may incept at any time during the contract period
Property coverage including Fire, Allied Lines and Extended
Coverages. Inland Marine and Commercial Multi-Peril when
written in conjunction with other coverages for limits of:-
$14,500,000 Ultimate Net loss plus pro-rata loss adjustment
expenses each and every loss, each original policy Excess of:
- $500,000 Ultimate Net loss plus pro-rata loss adjustment
expenses as respects each and every loss, each original
policy. Coverage shall be subject to the following
exclusions:-
1) Earthquake coverages
2) North American War Exclusion Clause
3) Seepage and Pollution Liability
A) Within 60 days after the end of each quarter the Company
shall provide the Reinsurer with a claims bordereaux
outlining any claim on which the Company has placed a
reserve value of more than $300,000. Losses and adjustment
expenses are recoverable by the Company immediately after
receipt of proof of loss subject to the retention
applicable herein.
B) Within 60 days after the end of the quarter that any
coverage, attaches the Company shall provide the Reinsurer
with a premium bordereaux outlining the applicable premium
(to be more fully defined in the contract wording).
PREMIUM: Minimum & Deposit Premium $750,000 annual payable quarterly as follows:
31st March, 30th June, 30th September and 31st December. The minimum
premium to be adjusted upwards at 92% of the original net ceded premium
limits within 45 days of the 31st December.
CLAIM AND LOSS
SETTLEMENTS: Within 60 days after the end of each calendar
quarter, the COMPANY shall provide the REINSURER with a
bordereaux outlining any claim or claims on which the COMPANY has
placed a reserve value of more than $3,000,000 each loss or
event. At each anniversary the Company shall provide a bordereaux
outlining all claims and reserves excess of $250,000 each loss or
$2,000,000 each event.
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Losses and adjustment expenses recoverable by the COMPANY are
payable immediately after receipt of proof of loss subject to the
RETENTION applicable herein.
ECO/XPL: The REINSURERS shall pay 100% of ECO/XPL losses reducing only by
8% coinsurance by the Company.
OTHER
PROVISIONS: Access to Records
Arbitration
Currency
Errors and Omissions
Federal Excise Tax
Insolvency
Net Retained Liability
Offset
Intermediary Clause
Salvage and Subrogation
Service of Suit
Taxes
Territory
Ultimate Net Loss, including pro-rata allocated
Loss Adjustment Expenses and 92% ECO/XPL for exposing policies
only.
Unauthorised Reinsurers
INTERMEDIARY: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Ltd.
BROKERAGE: 10%
DEFINITIONS: (1) Net Ceded Premium = Gross Allocated Premium to this
agreement less 25%.
(2) The term Gross Allocated Premium shall mean the written
premium allocated to this agreement on annual contracts or
instalments on multi-year contracts.
(3) The term "event" used herein shall mean all original claims
arising from an incident involving Medical and Dental
Practitioners and Hospitals and other Health Care
Institutions being an original insured hereon.
SECURITY: 60% Swiss Reinsurance Company
28% American Re-Insurance Company
4% Hannover Ruckversicherungs-Aktiengesellschaft