Term Sheet for All Lines Quota Share Reinsurance Agreements between Republic Underwriters Insurance Company and Texas General Agency (2006–2008)

Contract Categories: Business Finance › Underwriting Agreements
Summary

This agreement outlines the terms for quota share reinsurance between Republic Underwriters Insurance Company and Texas General Agency, effective for the years 2006, 2007, and 2008. It specifies the percentage of risk retained by Republic, commission structures, and loss ratios. The contract includes a non-compete clause restricting Republic from soliciting TGA’s wholesale agents during the contract and for 18 months after. Profit share adjustments are scheduled 24 months after each treaty year. If the reinsurer’s credit rating falls below a set level, additional financial security must be provided.

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EX-10.20 2 dex1020.htm TERMSHEET FOR REPUBLIC UNDERWRITERS INSURANCE COMPANY Termsheet for Republic Underwriters Insurance Company

Exhibit 10.20

 

Republic Underwriters Insurance Company / Texas General Agency

All Lines Quota Share Reinsurance Agreements

To Be Effective: January 1, 2006, 2007 and 2008

 

     Current Terms
   Proposed Terms
     2005
   2006
   2007
   2008

Republic Risk Position

                 

Minimum

    40%   50%   40%   30%

Projected

    40%   60%   40%   30%

Maximum

    40%   75%   50%   30%

Sliding Scale Structure

                 

Slide %

    [**]%   [**]%   [**]%   [**]%

Slide Ratio

    [**] : [**]   [**] : [**]   [**] : [**]   [**] : [**]

Minimum & Provisional Commission

    [**]%   [**]%   [**]%   [**]%

@

    @   @   @   @

Maximum Loss Ratio

    [**]%   [**]%   [**]%   [**]%

Maximum Commission

    [**]%   [**]%   [**]%   [**]%

@

    @   @   @   @

Minimum Loss Ratio

    [**]%   [**]%   [**]%   [**]%

Company Fees

    [**]%   [**]%   [**]%   [**]%

Boards Bureaus & Taxes

    Actual Incurred   Actual Incurred   Actual Incurred   Actual Incurred

 

Other Provisions:

 

Contract will include a non-compete clause prohibiting Republic from soliciting TGA’s current wholesale agent base during the term of the contract, plus 18 months.

 

First profit share adjustment is due 24 months after the end of the treaty year and is to be recalculated annually until all losses are settled.

 

If American Hallmark Insurance Company, or any other insurance company that assumes this business, drops below an AM Best Rating of A-, then a irrevocable letter of credit or trust funds must be supplied that is acceptable to Republic. The funds or L.O.C. must be sufficient to cover all ceded balances.

 

[**] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.