EX-10.18 12 y45204ex10-18.txt FORM OF REINSURANCE AGREEMENT 1 EXHIBIT 10.18 REINSURANCE AGREEMENT BETWEEN METROPOLITAN LIFE INSURANCE COMPANY AND CERTAIN REINSURERS 2 TABLE OF CONTENTS PREAMBLE 1 ARTICLE I. REINSURANCE DEFINITION 2 ARTICLE II. REINSURANCE PREMIUMS 3 ARTICLE III. ALLOWANCE 4 ARTICLE IV. MODIFIED COINSURANCE RESERVE ADJUSTMENT 5 ARTICLE V. REIMBURSEMENT FOR BENEFIT PAYMENTS 6 ARTICLE VI. EXPERIENCE REFUND 7 ARTICLE VII. ACCOUNTING AND SETTLEMENTS 8 ARTICLE VIII. DURATION, RECAPTURE AND TERMINATION 11 ARTICLE IX. TERMINAL ACCOUNTING AND SETTLEMENT 13 ARTICLE X. METLIFE REPRESENTATIONS AND WARRANTIES 14 ARTICLE XI. REINSURER REPRESENTATIONS AND WARRANTIES 16 ARTICLE XII. ARBITRATION 17 ARTICLE XIII. INSOLVENCY 19 ARTICLE XIV. NON-ADMITTED REINSURANCE 21 ARTICLE XV. GENERAL PROVISIONS 23 SCHEDULE A POLICIES AND RISKS REINSURED 29 SCHEDULE B EXISTING REINSURANCE 41 SCHEDULE C RESERVES 42 SCHEDULE D MODIFIED COINSURANCE RESERVE INVESTMENT CREDIT 44 SCHEDULE E ASSET PORTFOLIO 45 SCHEDULE F CEDING COMMISSIONS 46 SCHEDULE G QUARTERLY REPORT FORMAT 47 INTERESTS AND LIABILITIES CERTIFICATE 51 3 PREAMBLE THIS REINSURANCE AGREEMENT (the "Agreement") is made and entered into as of October 1, 2000, by and between Metropolitan Life Insurance Company, One Madison Avenue, New York, NY 10010, a New York domiciled life insurance corporation, ("MetLife") and each Reinsurer, severally for its own account, that signs this Agreement (each a "Reinsurer" and all, collectively, the "Reinsurers") and a separate Interests and Liabilities Certificate (each a "Certificate" and, all collectively, the "Certificates"), which Certificates are made a part hereof. THE BACKGROUND OF THIS AGREEMENT is that MetLife, as a consequence of its recent demutualization, has a closed block of Ordinary Life Insurance policy liabilities that MetLife wishes to cede up to ninety percent (90%) on a modified coinsurance basis and each Reinsurer, having reviewed materials provided by MetLife relating to such closed block, wishes to accept a portion of the proposed cession on that basis. NOW, THEREFORE, in consideration of the mutual promises and undertakings set forth herein, the parties agree as follows: 1 4 ARTICLE I. REINSURANCE DEFINITION 1. Policies and Risks Reinsured. In accordance with the terms and conditions hereof, MetLife hereby cedes and each Reinsurer hereby accepts severally, each for its own account, as indemnity reinsurance on a modified coinsurance basis, the quota share of MetLife's liabilities under the policies (the "Policies") listed in Schedule A, net of Existing Reinsurance as described in Schedule B, in the amount that is specified in the Certificate. 2. Conditions. This reinsurance is subject to the same limitations and conditions specified in the Policies, except as otherwise provided in this Agreement. 3. Policy Changes. MetLife must provide written notification to the Reinsurers of any program to change the original terms or conditions of a class of Policies with an aggregate face amount of more than one percent (1%) of the aggregate face amount of all Policies not later than fifteen (15) days after the change takes effect. Each Reinsurer will provide written notification to MetLife of the Reinsurer's acceptance or rejection of the change within fifteen (15) days after receipt of notice of the change. Each Reinsurer that accepts any such change will (a) assume that portion of any increase in MetLife's liability, resulting from the change, that corresponds to the reinsured portion of the Policies, and (b) receive credit for that portion of any decrease in MetLife's liability, resulting from the change, that corresponds to the reinsured portion of the Policies. The liabilities of each Reinsurer that rejects any such change will be determined as though no such change had occurred. 4. Reinstatements. If a Policy is reinstated into the MetLife Ordinary Closed Block while this Agreement is in force, the reinsurance for such Policy will be reinstated automatically and MetLife will pay each Reinsurer the Reinsurer's quota share of all amounts received by the MetLife Ordinary Life Closed Block in connection with the reinstatement of the Policy. 5. No Extracontractual Damages. No Reinsurer assumes liability under this Agreement for any damages, fines, penalties, costs or expenses, or portion thereof, levied on or assessed against MetLife by any court or regulatory body on the basis of negligence, oppression, malice, fraud, fault, wrongdoing or bad faith by MetLife in connection with any claim or for any other act or omission, unless such Reinsurer shall have received prior notice of and shall have concurred prior to the actions taken or not taken by MetLife that led to the levies or assessments, in which case, such Reinsurer shall pay its share of such levy or assessment. 2 5 ARTICLE II. REINSURANCE PREMIUMS 1. Initial Reinsurance Premium. MetLife will pay to each Reinsurer an "Initial Reinsurance Premium" in an amount equal to the Reinsurer's quota share of the Policy Statutory Reserve, as described in Schedule C, Paragraph 1, calculated as of the date of this Agreement. 2. Renewal Reinsurance Premium. Each Accounting Period, MetLife shall pay to each Reinsurer a "Renewal Reinsurance Premium" in an amount equal to the Reinsurer's quota share of the gross Policy premiums accrued during the Accounting Period by MetLife, net of any premiums incurred under any Existing Reinsurance as defined in Schedule B. The Renewal Reinsurance Premiums paid to the Reinsurers by MetLife will be remitted to the Reinsurers at the end of the Accounting Period during which the gross premiums were accrued by MetLife. 3 6 ARTICLE III. ALLOWANCE 1. Allowance. Each Reinsurer shall pay MetLife an "Allowance" for each Accounting Period equal to the Ceding Commission as defined in Paragraph 2 below plus the Expense Allowance as defined in Paragraph 3 below. 2. Ceding Commission. "Ceding Commission" means (a) times (b), where: (a) equals the Ceding Commission Percent for the applicable calendar year as set forth in Schedule F; and (b) equals the Renewal Reinsurance Premium as defined in Article II. 3. Expense Allowance. "Expense Allowance" means each Reinsurer's quota share of (a) plus (b) where (a) equals $10.00 times the number of Policies in force at the beginning of the Accounting Period; and (b) equals the Taxes and Assessments as defined in Paragraph 5 below. 4. Expenses. The allowance for any expenses incurred in connection with the Policies is included in the Allowance described in Paragraph 1. This Allowance is sufficient to cover anticipated allocable renewal expenses incurred by MetLife on the Policies reinsured. The Reinsurers will not reimburse MetLife for any other expenses incurred in connection with the Policies. 5. Taxes and Assessments. "Taxes and Assessments" are the allowances for any gross state and local premium taxes (including franchise taxes to the extent measured solely by premiums) paid in cash on premiums received in respect to the Policies, as well as additive state and local taxes. Gross state and local premium taxes will be before offsets and credits, including premium tax credits from guarantee fund assessments. The Reinsurers will not reimburse MetLife for any other taxes or assessments paid by MetLife in connection with the Policies. 4 7 ARTICLE IV. MODIFIED COINSURANCE RESERVE ADJUSTMENT 1. Initial Reserve Adjustment. Simultaneously with the payment of the Initial Reinsurance Premium, as described in Article II Paragraph 1, by MetLife to the Reinsurers, each Reinsurer will pay MetLife an initial reserve adjustment in an amount equal to the Modified Coinsurance Reserve, determined in accordance with Schedule C, Paragraph 2, calculated as of the date of this Agreement. 2. Modified Coinsurance Reserve Adjustment. The "Modified Coinsurance Reserve Adjustment" will be computed each Accounting Period equal to (a) minus (b) minus (c), where: (a) equals the Modified Coinsurance Reserve, as defined in Schedule C Paragraph 2, at the end of the current Accounting Period on the Policies; (b) equals the Modified Coinsurance Reserve, as defined in Schedule C Paragraph 2, at the beginning of the current Accounting Period, on the Policies; and (c) equals the Modified Coinsurance Reserve Investment Credit, as described in Schedule D. 3. In calculating a Terminal Accounting and Settlement payment, the reference in (a) above to "the end of the current Accounting Period" refers to the Terminal Accounting Date as described in Article IX Paragraph 2. 4. For any Accounting Period in which the amount computed in Paragraph 2 above is positive, each Reinsurer will pay MetLife such amount. For any Accounting Period in which the amount computed in Paragraph 2 above is negative, MetLife will pay each Reinsurer the absolute value of such amount. 5 8 ARTICLE V. REIMBURSEMENT FOR BENEFIT PAYMENTS 1. Reimbursement for Benefit Payments. Each Reinsurer will pay MetLife a "Reimbursement for Benefit Payments" equal to the Reinsurer's quota share of the Benefit Payments defined in Paragraph 2. 2. Benefit Payments. "Benefit Payments", as referred to in this Agreement, means the sum of the following items: (a) death benefits incurred by MetLife in accordance with Policy terms, net of any death benefit reimbursements accrued by MetLife under Existing Reinsurance; (b) matured endowments incurred by MetLife in accordance with Policy terms, net of reimbursements for such endowments accrued by MetLife under Existing Reinsurance; (c) disability benefits incurred by MetLife in accordance with Policy terms, net of reimbursements for the disability benefits accrued by MetLife under Existing Reinsurance; (d) surrender benefits and other fund withdrawals incurred by MetLife in accordance with Policy terms, net of any surrender value reimbursements accrued by MetLife under Existing Reinsurance; (e) the cash surrender value of Policies transferred to nonforfeiture extended term insurance, net of any reserve credit established by MetLife under Existing Reinsurance; (f) interest credited to Policies by MetLife in accordance with Policy terms, net of any reimbursements for such credits accrued by MetLife under Existing Reinsurance; and (g) dividends and any additional amounts incurred or credited by MetLife arising from the declaration of interest, mortality or expense more favorable than guaranteed on the Policies after the date of this Agreement, net of any corresponding reimbursements accrued by MetLife under Existing Reinsurance. 3. Liability and Payment. The Reinsurers will accept the decision of MetLife with respect to the determination and payment of Policy Benefit Payments. Each Reinsurer will pay the Reimbursement for Benefit Payments in a lump sum to MetLife without regard to the form of settlement by MetLife. 6 9 ARTICLE VI. EXPERIENCE REFUND 1. General. For the period set forth in Paragraph 2, each Reinsurer will pay an Experience Refund to MetLife equal to the Trial Experience Refund detailed in Paragraph 3 below at the end of each Accounting Period with respect to the reinsurance hereunder, if such Trial Experience Refund is positive for that Accounting Period. If the Trial Experience Refund is negative for the current Accounting Period, then the Experience Refund is set equal to zero and the absolute value of the negative amount will be carried forward and included in the Memorandum Account calculation as described in Article VII, Paragraph 9, and will be offset against any future positive Trial Experience Refunds in accordance with item (v) of part (b) of the formula detailed in Paragraph 3 below. 2. Period. Each Reinsurer will pay an Experience Refund at the end of each Accounting Period up to and including the last Accounting Period ending prior to the tenth anniversary of the Reinsurance Agreement. 3. Trial Experience Refund. With respect to each Accounting Period, the "Trial Experience Refund" for any Reinsurer will be equal to (a) minus (b), where: (a) equals the sum of: (i) the Renewal Reinsurance Premium determined in accordance with Article II; and (ii) any Modified Coinsurance Reserve Adjustment payable to the Reinsurer determined in accordance with Article IV; and (b) equals the sum of: (i) the Reimbursement for Benefit Payments, determined in accordance with Article V; (ii) the Allowance determined in accordance with Article III; (iii) any Modified Coinsurance Reserve Adjustment payable to MetLife determined in accordance with Article IV; (iv) the Expense and Risk Charge determined in accordance with Paragraph 2 of the Reinsurer's Certificate; and (v) the balance of the Memorandum Account, as described in Article VII, Paragraph 9, at the end of the preceding Accounting Period, with accrued interest thereon. 7 10 ARTICLE VII. ACCOUNTING AND SETTLEMENTS 1. Accounting Period. Each "Accounting Period" under this Agreement will be quarterly, except that: (a) the initial Accounting Period runs from the date of this Agreement through the last day of the calendar quarter during which the date of this Agreement falls, and (b) the final Accounting Period runs from the end of the preceding Accounting Period until the Terminal Accounting Date of this Agreement, as described in Article IX, Paragraph 2. 2. Quarterly Accounting Reports. MetLife shall submit quarterly accounting reports in the form of Schedule G to each Reinsurer for each Accounting Period not later than forty-five (45) days after the end of each Accounting Period. Such reports will include information on the amount of the Initial Reinsurance Premium, Renewal Reinsurance Premium, the Allowance, Benefit Payments, Experience Refund, Expense and Risk Charge, Memorandum Account, Modified Coinsurance Reserve, Modified Coinsurance Reserve Investment Credit, Policy cash value, and the market and book value of the Asset Portfolio. 3. Quarterly Settlements. (a) At the end of each Accounting Period, MetLife will pay each Reinsurer the sum of: (i) Renewal Reinsurance Premium determined in accordance with Article II; and (ii) any Modified Coinsurance Reserve Adjustment payable to the Reinsurer determined in accordance with Article IV. (b) Simultaneously, the Reinsurer will pay MetLife the sum of: (i) Reimbursement for Benefit Payments, determined in accordance with Article V; (ii) the Allowance determined in accordance with Article III; (iii) Any Modified Coinsurance Reserve Adjustment payable to MetLife determined in accordance with Article IV; and (iv) Any Experience Refund determined in accordance with Article VI. 4. Amounts Due Quarterly. Except as otherwise specifically provided in this Agreement, all amounts due to be paid to either MetLife or each Reinsurer under this Agreement will be determined on a net basis at the end of each 8 11 Accounting Period. Net amounts due the Reinsurer will be payable within sixty (60) days after the end of each Accounting Period. Net amounts due MetLife will be payable fifteen (15) days after the receipt of the quarterly accounting report with respect to such Accounting Period. 5. Annual Accounting Reports. MetLife will provide annual accounting reports to the Reinsurers within forty-five (45) days after the end of the calendar year for which such reports are prepared. These reports will contain sufficient information about the Policies to enable each Reinsurer to prepare its annual financial reports and to verify the information reported in Schedule G, and will include Exhibit 8 (Aggregate Reserve for Life Policies and Contracts) by reserve basis, Page 7 (Analysis of Increase in Reserves and Deposit Funds During the Year), Pages 24-25 (Exhibit of Life Insurance), Schedule S of the Annual Statement and the Risk-Based Capital report. 6. Estimations. If the amounts required in Paragraph 3 above cannot be determined by the dates described in Paragraph 4 above, on an exact basis, such amounts will be estimated in accordance with reasonable actuarial methods that will approximate the actual amounts. Adjustments to payments based upon such estimates will then be made to reflect actual amounts when such amounts become available. 7. Delayed Payments. For purposes of Paragraph 4 above, if there is a delayed settlement of a payment due, interest will be payable for the number of days from the due date through the date paid, at an annualized rate equal to the sum of (i) the one month London Interbank Offered Rate (LIBOR) as published by The Wall Street Journal at the end of the Accounting Period plus (ii) 100 basis points. 8. Offset of Payments. All monies due either MetLife or a Reinsurer under this Agreement will be offset against each other, dollar for dollar, regardless of any insolvency of either party. 9. Memorandum Account. Should the settlement formula described in Paragraph 3 above, produce an amount due MetLife, the Reinsurer will pay such amount in cash or its equivalent within fifteen (15) days after the quarterly accounting report is received by the Reinsurer. Solely for the purpose of calculating Trial Experience Refunds, the Terminal Settlement and any Supplementary Settlement as defined herein, each Reinsurer will establish a "Memorandum Account" in which such amounts paid to MetLife and all future such payments will accrue with interest at the Memorandum Account Rate described in Paragraph 10 below. The balance of the Memorandum Account at the beginning of any Accounting Period will equal absolute value of any negative Trial Experience Refund determined in accordance with Article VI, Paragraph 3, for the preceding Accounting Period. These losses, and accrued interest thereon, will be 9 12 carried forward to subsequent Accounting Periods and will be a deduction item in the calculation of future Trial Experience Refunds in accordance with Article VI, Paragraph 3. 10. Memorandum Account Rate. The Memorandum Account Rate at the end of each Accounting period will be equal to Modified Coinsurance Reserve Investment Rate determined in accordance with Schedule D, Paragraph 1, but not less than zero. 11. Tax Election. With respect to reinsurance ceded under the Agreement to any Reinsurer that is subject to US taxation as represented in Paragraph 4 of its Certificate, the parties shall make a joint election, in accordance with Treas. Reg. 1.848-2(g)(8) (the "Regulation"), issued December 28, 1992, under Section 848 of the Code, and: The party with the net positive consideration under this Agreement shall capitalize specified policy acquisition expenses, with respect to this Agreement, without regard to the general deductions limitations of Section 848(c)(1) of the Code; The election shall take effect as of the date of this Agreement and shall remain in effect for all subsequent years that this Agreement remains in effect; and Each party shall attach a schedule to its federal income tax return for its first taxable year ending after the election becomes effective that identifies the agreements (including this agreement) for which joint elections have been made under the Regulation. Pursuant to this joint election: each party shall exchange information pertaining to the amount of net consideration under this Agreement to assure consistency or as may otherwise be required by the Internal Revenue Service; MetLife shall submit its calculation of the "net consideration" as defined under Treas. Reg. 1.848-2(f) to the Reinsurer not later than May 1st for each and every tax year for which this Agreement is in effect; The Reinsurer may challenge such calculation within ten (10) working days of receipt of MetLife's calculation; and The parties will act in good faith to reach agreement as to the correct amount of net consideration whenever there is disagreement as to the amount of net consideration, as determined under Treas. Reg. 1.848-2(f). 10 13 ARTICLE VIII. DURATION, RECAPTURE AND TERMINATION 1. Duration. Except as otherwise provided herein, this Agreement is unlimited in duration. 2. Reinsurer's Liability. The liability of each Reinsurer with respect to any Policy reinsured hereunder will begin on the date of this Agreement. The Reinsurer's liability with respect to any Policy reinsured hereunder will terminate on the earliest of (i) the date such Policy is recaptured; (ii) the date MetLife's liability on such Policy is terminated; or (iii) the date this Agreement is terminated. In no event shall this Paragraph be construed as providing a unilateral right of the Reinsurer to terminate this Agreement. 3. Recapture. Reinsurance ceded to any Reinsurer hereunder may be separately recaptured at MetLife's option: (a) at any time following the fifth anniversary of the Reinsurance Agreement, provided that each Reinsurer's liability will be recaptured in proportion to the ratio of total liability recaptured to the total liability then reinsured hereunder; (b) in the event that the rating assigned to such Reinsurer by any of A. M. Best Company for financial condition, operating performance and market profile; Moody's Investors Service for financial strength; or Standard and Poor's Corporation for financial strength, as represented and warranted in the Reinsurer's Certificate, shall be reduced by two grades, in which case such recapture must be one hundred percent (100%) of such Reinsurer's liability; (c) if MetLife shall, for any reason, not be entitled to all relevant statement credit for the cession of reinsurance to a Reinsurer in its Annual Statement as filed in its domiciliary state, in which case such recapture must be one hundred percent (100%) of such Reinsurer's liability; (d) in the event of a change in ultimate voting control of the Reinsurer or its ultimate controlling person; provided, further, that the Reinsurer shall notify MetLife of any such change in voting control within five (5) days after the date of such change; or (e) in the event that the Reinsurer ceases to have the U.S. tax status then represented and warranted in its Certificate: provided, however, that MetLife may not effect a recapture hereunder if the Reinsurer shall, as soon as practicable and before the as of date of the next MetLife quarterly or annual statement, agree to enter into 11 14 the appropriate tax election agreement with MetLife similar to that then currently in use hereunder for the Reinsurer's new status. MetLife will provide thirty (30) days advance notice prior to the effective date of recapture. Such recapture will be subject to the payment of a Terminal Accounting and Settlement as described in Article IX. 4. Internal Replacements. Should MetLife, its affiliates, successors or assigns, initiate a "Program of Internal Replacement" that includes any of the Policies reinsured hereunder, MetLife will immediately notify the Reinsurers. All solicited replacement policies will be treated as recaptured rather than surrendered. Each Reinsurer may elect at its sole option to treat either all policies reinsured hereunder as recaptured or all policies of the issue year(s) in which policies were internally replaced as recaptured. Such recapture will be subject to the payment of a Terminal Accounting and Settlement by MetLife to the Reinsurer as described in Article IX. For purposes of this Agreement, the term "Program of Internal Replacement" means any effort by MetLife, its affiliates, successors or assigns generally to solicit replacements of Policies by which a Policy or any portion of the cash value of a Policy is exchanged for another policy or contract that is not reinsured under this Agreement; provided, however, that providing unsolicited replacements at the request of a Policy owner shall not be considered a Program of Internal Replacement. 5. Termination for Nonpayment of Amounts Due. If MetLife fails to pay the Reinsurance Premiums or any other amounts due to a Reinsurer pursuant to this Agreement within ninety (90) days after the end of any Accounting Period, that Reinsurer may terminate this Agreement, subject to thirty (30) days prior written notice to MetLife. If a Reinsurer fails to pay the Reimbursement for Benefit Payments or any other amounts due to MetLife pursuant to this Agreement, within sixty (60) days after the receipt of the Quarterly Accounting Report, MetLife may terminate this Agreement as to that Reinsurer, subject to thirty (30) days prior written notice to the Reinsurer. Such termination will be subject to the payment of a Terminal Accounting and Settlement as described in Article IX Paragraph 3. 12 15 ARTICLE IX. TERMINAL ACCOUNTING AND SETTLEMENT 1. Terminal Accounting. A Terminal Accounting and Settlement will take place if: (1) any reinsurance under this Agreement is recaptured in accordance with Article XIII Paragraph 6; (2) any portion or percentage of all reinsurance under this Agreement is recaptured in accordance with Article VIII, Paragraph 3; (3) the Policies are subject to a Program of Internal Replacement as described in Article VIII, Paragraph 4; or (4) this Agreement is terminated. 2. Terminal Accounting Date. A "Terminal Accounting Date" will be the earliest of: (1) the effective date of recapture pursuant to any notice of recapture given under this Agreement; (2) the effective date of termination pursuant to any notice of termination given under this Agreement; or (3) such other date mutually agreed in writing. 3. Settlement. The Terminal Accounting and Settlement payment to any Reinsurer will consist of: (a) the quarterly settlement as provided in Article VII, Paragraph 3, computed as of the Terminal Accounting Date; (b) payment by MetLife to the Reinsurer of a terminal reserve equal to the Modified Coinsurance Reserve on the Policies as of the Terminal Accounting Date; (c) payment by the Reinsurer to MetLife of a terminal reserve adjustment equal to the Modified Coinsurance Reserve on the Policies as of the Terminal Accounting Date; and (d) payment by MetLife to the Reinsurer of any Memorandum Account as described in Article VII, Paragraph 9, as of the Terminal Accounting Date. If only a portion or a percentage of all of Policies is recaptured, then the Terminal Accounting and Settlement payment described above will be made only with respect to the portion or percentage of such Policies recaptured. 4. Supplementary Accounting and Settlement. In the event that, subsequent to the Terminal Accounting and Settlement as provided above, a change is made with respect to any amounts due, a supplementary accounting will take place pursuant to Paragraph 3 above. Any amount owed to MetLife or to any Reinsurer by reason of such supplementary accounting will be paid within fifteen (15) days following the completion thereof. 13 16 ARTICLE X. METLIFE REPRESENTATIONS AND WARRANTIES MetLife represents and warrants, to the best of its knowledge, the following: 1. Corporate Status. MetLife is duly licensed, qualified or admitted to do business and is in good standing in all jurisdictions in which it is required to be so qualified, licensed or admitted to do business by the laws thereof. 2. Authority. MetLife has the full corporate power and authority to carry out and perform its undertakings and obligations under this Agreement. This Agreement has been duly and validly signed and delivered by MetLife. MetLife shall at all times maintain in force all such legal and regulatory authorizations as may be reasonably necessary or appropriate for the performance of its obligations under this Agreement. 3. MetLife Information. MetLife acknowledges that, at the Reinsurers' request, it has provided certain information pertaining to the MetLife Ordinary Life Insurance Closed Block for the Reinsurers' consideration. This information included but is not limited to a copy of the PricewaterhouseCoopers May 12, 2000 document captioned "Closed Block Funding for MetLife US Traditional Life and US Industrial Life" that was originally distributed to the New York State Insurance Department (the "Department") as documentation related to the overall demutualization process. MetLife represents that all factual information that it provided to the Reinsurers is complete and accurate as of the date of the document in which such information is contained. MetLife further represents that any assumptions made in providing this information were based upon informed judgment and are consistent with sound actuarial principles. MetLife further represents that it is not aware of any omissions, errors, changes or discrepancies that would materially affect this information. MetLife acknowledges that the Reinsurers have relied on this information and the foregoing representations in entering into this Agreement. The preceding representations and the information provided are not to be construed as warranties by MetLife to any Reinsurer with respect to future mortality, lapse, expense or investment experience of the Policies or their associated liabilities and assets. 4. Other Reinsurance. (a) As of the date of this Agreement, MetLife has in force, with respect to the Policies, various cessions of reinsurance on a coinsurance, YRT, excess or other basis (each an "Existing Reinsurance") that it expects to continue in force under reinsurance agreements that are listed in Schedule B. MetLife reserves the right to recapture any Existing Reinsurance at any time, provided that reinsurance provided by the terms of this Agreement shall not be increased 14 17 thereby as to any Reinsurer without the consent of the Reinsurer, which consent will not be unreasonably withheld. (b) MetLife may, from time to time, enter into other reinsurance agreements affecting the Policies reinsured. MetLife must provide written notification to the Reinsurers of any such change. Each Reinsurer will provide written notification to MetLife of the Reinsurer's acceptance or rejection of the change within fifteen (15) days after receipt of notice of the change. If the Reinsurer rejects any such change, the Policies will be considered recaptured and subject to the payment of a Terminal Accounting and Settlement as described in Article IX. Upon acceptance of any such change, Schedule B will be updated to reflect such change. 5. Administration. The Policies are subject to certain terms and conditions specified by the Department for administration as a Closed Block. Among other things, these terms and conditions require that dividends will be apportioned annually by the MetLife Board of Directors or the Committee thereof supervising the operations of the MetLife Ordinary Life Closed Block in accordance with applicable law and with objective of minimizing tontine effects and exhausting assets allocated to the MetLife Ordinary Life Closed Block with the final payment upon termination of the last Policy. MetLife will continue to administer the Policies in the ordinary course of business in accordance with the specified terms and conditions, as they may be revised from time to time. 6. Tax Status. MetLife represents and warrants that it is subject to U. S. taxation under Subchapter L of Chapter 1 of the Internal Revenue Code of 1986 (the "Code"). 15 18 ARTICLE XI. REINSURER REPRESENTATIONS AND WARRANTIES Each Reinsurer represents and warrants, to the best of its knowledge, the following: 1. Corporate Status. The Reinsurer is duly licensed, qualified or admitted to do business and is in good standing in all jurisdictions in which it is required to be so qualified, licensed or admitted to do business by the laws thereof. 2. Authority. The Reinsurer has the full corporate power and authority to carry out and perform its undertakings and obligations under this Agreement. This Agreement has been duly and validly signed and delivered by Reinsurer. Reinsurer shall at all times maintain in force all such legal and regulatory authorizations as may be reasonably necessary or appropriate for the performance of its obligations under this Agreement. 3. Ratings. The Reinsurer shall have stated in its Certificate the ratings, as of the date of this Agreement, issued to it by A. M. Best Company for financial condition, operating performance and market profile; Moody's Investors Service for financial strength; and Standard and Poor's Corporation for financial strength. Each Reinsurer shall notify MetLife of any subsequent change in such ratings within five (5) days after of the date that a change is announced. 16 19 ARTICLE XII. ARBITRATION 1. All disputes and differences between MetLife and any Reinsurer will be decided by arbitration, regardless of the insolvency of either party, unless the liquidator, receiver or statutory successor is specifically exempted from an arbitration proceeding by applicable law. 2. Either party may initiate arbitration by providing written notification to the other party that sets forth (a) a brief statement of the issue(s); (b) the failure of the parties to reach agreement; and (c) the date of the demand for arbitration. 3. The arbitration panel shall consist of three arbitrators who must be impartial and each of whom must, at that time, either be accredited as an arbitrator by ARIAS-US or be an active or former officer of a life insurance or reinsurance company other than the parties or their affiliates. 4. Each party shall select an arbitrator within thirty (30) days from the date of the demand. If either party shall refuse or fail to appoint an arbitrator within the time allowed, the party that has appointed an arbitrator may notify the other party that, if it has not appointed its arbitrator within the following ten (10) days, the arbitrator will appoint an arbitrator on its behalf. Within thirty (30) days of the appointment of the second arbitrator the two (2) arbitrators shall select the third arbitrator, who must also be, at that time, accredited by ARIAS-US as an umpire. If the two arbitrators fail to agree on the selection of the third arbitrator within the time allowed, the Umpire Selection Procedures of ARIAS-US, as in force at that time, shall be used to select the third arbitrator. 5. The arbitrators shall interpret this Agreement as an honorable engagement rather than merely as a legal obligation and shall consider equitable principles as well as industry custom and practice regarding the applicable insurance and reinsurance business. The arbitrators are released from judicial formalities and shall not be bound by strict rules of procedure and evidence. 6. The arbitrators shall determine all arbitration schedules and procedural rules and may, in their discretion, use applicable ARIAS-US forms and procedures. Organizational and other meetings will be held in New York, NY, unless the arbitrators shall otherwise provide. The arbitrators shall decide all matters by majority vote. 7. The decisions of the arbitrators shall be final and binding on both parties. The arbitrators may, in their discretion, award costs and expenses, as they deem appropriate, including but not limited to legal fees and interest. Judgment may be entered upon the final decisions of the arbitrators in any 17 20 court of competent jurisdiction. The arbitrators may not award any exemplary or punitive damages. 8. Unless the arbitrators shall provide otherwise, each party will be responsible for (a) all fees and expenses charged by its respective counsel, accountants, actuaries and other representatives in connection with the arbitration and (b) one-half of the expenses of the arbitration, including the fees of the arbitrators. 18 21 ARTICLE XIII. INSOLVENCY 1. Insolvency. In the event of the insolvency, liquidation or rehabilitation of MetLife or the appointment of a liquidator, receiver or statutory successor of MetLife, the reinsurance provided hereunder shall be payable by the Reinsurers directly to MetLife or to its liquidator, receiver or statutory successor on the basis of the liability of MetLife under the Policies without diminution because of such insolvency, liquidation, rehabilitation or appointment or because such liquidator, receiver or statutory successor of MetLife has failed to pay any or a portion of any claims. 2. Notice To Reinsurers. In any such event, the liquidator, receiver or statutory successor of MetLife shall give the Reinsurers written notice of the pendency of each claim against MetLife on a Policy within a reasonable time after each such claim is filed in the insolvency, liquidation or rehabilitation proceeding. 3. Claim Defenses. During the pendency of any such claim, each Reinsurer may, at its own expense, investigate such claim and interpose in the proceeding in which such claim is to be adjudicated any defense or defenses that the Reinsurer may reasonably deem available to MetLife or its liquidator, receiver or statutory successor. The expenses incurred in connection therewith by the Reinsurer shall be chargeable, subject to court approval, against MetLife as part of the expenses of such insolvency, liquidation or rehabilitation to the extent of any benefit that accrues to MetLife solely as a result of the defense or defenses undertaken by the Reinsurer. 4. Two or More Reinsurers. If two or more Reinsurers are involved in the same claim and a majority in interest elects to interpose a defense to such claim, the expense shall be apportioned in accordance with the terms hereof as though such expense had been incurred by MetLife. 5. No Enlargement of Obligations. The provisions of this Article shall neither change the relationship or status of the parties or enlarge the obligations established under this agreement between MetLife and any Reinsurer, except as specifically provided, nor create any additional obligations or establish any further rights against either MetLife or any Reinsurer in favor of any other persons not parties to this Agreement. 6. Recapture Right. MetLife may, in its discretion recapture all reinsurance ceded with respect to any Reinsurer at any time during which such Reinsurer may be insolvent, as defined below, subject to the payment of a Terminal Accounting and Settlement, and any Supplemental Settlements that may be necessary or appropriate, as described in Article IX, Paragraphs (3) and (4). As used in the preceding sentence, "Insolvency" 19 22 shall mean: (a) the filing of a voluntary petition for liquidation by or on behalf of the Reinsurer; (b) any assignment for the benefit of creditors of the Reinsurer; or (c) the appointment of a liquidator, receiver or statutory successor of the Reinsurer. 20 23 ARTICLE XIV. NON-ADMITTED REINSURANCE 1. Letters Of Credit. If MetLife shall, at any time, reasonably determine that a Letter of Credit ("LOC") that complies with the provisions of New York Insurance Department Regulation 133, Part 79 of Title 11 of the Compilation of Codes, Rules and Regulations of the State of New York is or may be necessary for MetLife to obtain any associated regulatory statement credit for reinsurance ceded to a Reinsurer under this Agreement, MetLife shall notify the Reinsurer that an LOC in a specified principal amount shall be required hereunder. 2. Application. The Reinsurer, as the applicant for such LOC, shall, upon obtaining MetLife's advance approval of a proposed issuing bank (the "Bank"), which approval shall not be unreasonably withheld, promptly apply for and secure issuance of an LOC to MetLife, as beneficiary, in the specified principal amount; provided, however, that the Bank shall not issue the LOC until MetLife shall have approved the amount of the Bank LOC fee; and provided, further, that MetLife shall, as of the date of the LOC, reimburse the Reinsurer for the net amount of the Bank LOC fee paid by the Reinsurer; provided, however, that MetLife shall have not direct liability hereunder to the Bank. 3. Stipulations. The LOC may be drawn at any time, notwithstanding any other provisions herein and may be utilized by MetLife or any successor by operation of law, including without limitation any liquidator, rehabilitator or receiver of MetLife for the following purposes: (a) to reimburse MetLife for the Reinsurer's share of Policy premiums returned on account of cancellations; (b) to reimburse MetLife for the Reinsurer's share of surrenders and benefits or losses paid by MetLife under the terms and provisions of the Policies; (c) to fund an account with MetLife in an amount at least equal to the ceded reinsurance deduction from MetLife's Policy liabilities hereunder, which amount shall include, but not be limited to, amounts for Policy reserves, reserves for claims and losses incurred (including losses incurred but not reported), loss adjustment expenses and unearned premiums; provided, however, that MetLife will pay interest on funds held under this provision at the rate published in The Wall Street Journal for prime corporate loans at the majority of large U. S. money center commercial banks, which rate shall be adjusted on the last day of each month; and 21 24 (d) to pay any other amounts that MetLife claims to be due hereunder with respect to the Policies. MetLife will return any amounts drawn on the LOC in excess of the actual amounts required for subparagraphs (a), (b) and (c) of this paragraph or, in the case of subparagraph (d) of this paragraph, any amounts that are subsequently determined not to be due. All of the foregoing provisions are to be applied without diminution because of insolvency on the part of either party. 22 25 ARTICLE XV. GENERAL PROVISIONS 1. Policy Administration. MetLife will administer the Policies and will perform all accounting for such Policies. Claim settlements made by MetLife in good faith, including compromises, shall be unconditionally binding on the Reinsurers. 2. Audit. Upon reasonable advance notice, each Reinsurer may, at a reasonable location or locations to be designated by MetLife, audit any and all books, records, statements, correspondence, reports and other documentation that relate to the Policies. MetLife shall provide a reasonable workspace during normal business hours for such audit and shall cooperate with and disclose and produce any and all documentation reasonably requested by the auditors. The Reinsurer shall keep all information disclosed or produced for audit, including all audit reports and analyses, confidential as provided herein. 3. Annual Statement. "Annual Statement" means the Annual Statement prepared in accordance with the rules of the National Association of Insurance Commissioners and filed with the Department. If the Annual Statement blank is changed or modified, such that any item described herein does not appear on the pages, exhibits, columns and lines referred to herein, or if it should be eliminated or combined with other amounts or if the basis set out in the Annual Statement blank for calculation of any item herein should be modified so that the calculation is not consistent with the calculation of the such item described herein, then such item will be determined in accordance with a method proposed by MetLife with the consent of the Reinsurers, which consent shall not be unreasonably withheld. 4. Errors and Omissions. Any inadvertent errors or omissions on the part of one party occurring in connection with this Agreement or any transaction hereunder shall not relieve the other party from any liability to the first party that would have otherwise attached had such error or omission not occurred, provided that such error or omission is rectified as soon as practicable after discovery. 5. Indemnification and Limitation of Liability. MetLife and each Reinsurer will indemnify and hold the other, its affiliates, directors, officers, employees and all other persons and entities acting on behalf of or under the control of any of them harmless from and against any and all claims, including reasonable legal expenses, that result from any negligent, dishonest, malicious, fraudulent or criminal act or omission or arising out of or related to any incorrect representation, warranty or obligation of this Agreement or any failure or breach of this Agreement by the indemnifying party, its directors, officers, employees, other representatives or any other person 23 26 or entity acting on behalf of or under the control of any of them. In no event shall any party to this Agreement be liable to any other party for punitive, indirect or consequential damages arising under this Agreement for any cause whatsoever, whether or not such party has been advised or could have foreseen the possibility of such damages. 6. Assignment, Retrocessions and Securitizations. MetLife may not assign this Agreement or any rights, duties or obligations hereunder without the prior written consent of the Reinsurers. Each Reinsurer shall retain its quota share obligations hereunder net for its own account and no Reinsurer may assign, retrocede or securitize this Agreement or any rights, duties or obligations hereunder without the prior written consent of MetLife; provided, however, that this requirement shall not apply (a) to retrocessions by a Reinsurer to another reinsurer that is under common control with such Reinsurer or (b) to the Reinsurer's general excess retrocessions in the Reinsurer's ordinary course of business. 7. Amendment and Non Waiver. This Agreement may be amended only by written agreement of the parties. Any change or modification to this Agreement shall be null and void unless made by amendment to this Agreement and signed by both parties. No waiver by either party of any default by the other party shall be construed to be a waiver by such party of any other or subsequent default in performance of the same or any other promise, term or condition of this Agreement. No prior transactions or dealings between the parties shall be deemed to establish any custom or usage waiving or modifying any provision hereof. The failure of either party to enforce any part of this Agreement shall not constitute a waiver by such party of its right to do so, nor shall it be deemed to be an act of ratification or consent. 8. Severability. In the event that any provision or term of this Agreement shall be held by any court to be invalid, illegal or unenforceable, all of the other terms and provisions shall remain in full force and effect to the extent that their continuance is practicable and consistent with the original intent of the parties. In addition, if provisions are held invalid, illegal or unenforceable, the parties will attempt in good faith to renegotiate the Agreement to carry out its original intent. 9. Survival. All of the provisions of this Agreement, to the extent necessary to carry out the purposes of this Agreement or to ascertain and enforce the parties' rights hereunder, shall survive the termination of this Agreement. 10. Choice of Law, Forum and Consent to Service. This Agreement is subject to and is to be interpreted in accordance with the laws of the State of New York without regard to the New York choice of law rules. While the parties contemplate that all disputes will be decided through arbitration as 24 27 provided herein, in the event of any legal proceedings, the parties shall submit to the exclusive jurisdiction of courts of the State of New York and the United States of America located in the City of New York and shall abide by the final decision of such courts. Each Reinsurer hereby designates the Superintendent of Insurance of the State of New York 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 MetLife arising out of the Agreement. Process accepted by the Superintendent on behalf of a Reinsurer shall be forwarded to the Reinsurer at the address specified in the Reinsurer's Certificate. 11. Settlements. All reinsurance settlements shall be effected through offsetting balances, electronic funds transfers or as the parties may otherwise agree in order to carry out the purposes of this agreement. 12. Notices. (a) Written notices to MetLife under this Agreement shall be effective when delivered to MetLife at the following address: Roberto Baron, Vice President and Senior actuary Metropolitan Life Insurance Company One Madison Avenue New York, NY 10010 or such other address as MetLife may designate in writing as to its own address; provided, however, that any notice of change of address shall be effective only upon receipt. (b) Written notices to a Reinsurer under this Agreement shall be effective when delivered to the Reinsurer at the address specified in the Reinsurer's Certificate or such other address as the Reinsurer may designate in writing as to its own address, provided, however, that any notice of change of address shall be effective only upon receipt. 13. Confidentiality. All records and information obtained from or on behalf of MetLife are confidential and shall not be disclosed by any Reinsurer; provided, however, that this obligation of confidentiality shall not apply (a) if and to the extent that disclosure by a Reinsurer is required by applicable law or any court, government agency or regulatory authority or by subpoena or discovery request in pending litigation; (b) if the information is or becomes available from public information (other than as a result of prior unauthorized disclosure by the Reinsurer); (c) if the information is or was received from a third party not known by the Reinsurer to be under a confidentiality obligation with regard to such information; or (d) if the information was in the possession of the Reinsurer (having been received 25 28 on a non-confidential basis) other than by reason of the reinsurance provided pursuant to this Agreement. In the event that a Reinsurer becomes legally compelled to disclose any secret or confidential information, the Reinsurer will give prompt written notice of that fact to MetLife so that MetLife may seek an appropriate remedy to prevent such disclosure. 14. Agents, Intermediaries and Representatives. All negotiations relative to this Agreement and the transactions contemplated hereby, including all communications and payments, have been and will be carried out by MetLife and the Reinsurers and designated agents thereof directly and without the intervention of any person in such manner as to give rise to any valid claim by any other person against MetLife for a finder's fee, brokerage, commission or similar payment. Any communication or payment delivered by MetLife to a designated agent, intermediary or representative of a Reinsurer shall be deemed delivered to such Reinsurer and no delivery of a communication or payment by a Reinsurer to its agent, intermediary or representative shall be deemed delivered to MetLife until actual receipt by MetLife. 15. Independent Contractor. The parties shall be deemed to be independent contractors, each with full control over its respective business affairs and operations. The Agreement shall not be construed as a partnership or joint venture and neither party hereto shall be liable for any obligations incurred by the other party except as expressly provided herein. 16. Schedules, Certificates and Captions. Schedules attached hereto are made a part of this Agreement. The Reinsurers' Certificates attached hereto are made a part of this Agreement as between MetLife and the respective signatories. Captions are provided for reference only and are not made a part of this agreement. 17. Rules of Construction. Each party acknowledges that, in the negotiation and drafting of this Agreement, it has been represented by and has relied upon the advice of counsel of its choice; that its counsel has had a substantial role in the drafting and negotiation of this Agreement; and, therefore, that the rule of construction that any ambiguities are to be resolved against the drafting party shall not be applied in the interpretation of this Agreement. 18. Counterparts. This Agreement and each Reinsurer's Certificate may be signed simultaneously in any number of counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same instrument as to the respective signatories. 19. Entire Agreement. This Agreement, including the Schedules attached hereto and the Reinsurers' Certificates, as to their respective signatories, 26 29 supersede all prior discussions and agreements between MetLife and the Reinsurers and constitute their sole and entire agreement with respect to the Policies and there are no understandings between the parties other than as expressed in the Agreement. 27 30 IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the date first above written. METROPOLITAN LIFE INSURANCE COMPANY By: _____________________________ Title: ____________________________ EUROPEAN REINSURANCE COMPANY OF ZURICH By: _____________________________ Title: _____________________________ 28 31 SCHEDULE A POLICIES AND RISKS REINSURED 1. Policies and Risks Reinsured. The Policies and risks reinsured under this Agreement are MetLife's net liability on the policies and riders in the MetLife Ordinary Life Closed Block, as defined in Paragraph 2 below, that are in force as of the date of this Agreement. "Net liability" means MetLife's net retained liability on all Policies. 2. MetLife Ordinary Life Closed Block. "MetLife Ordinary Life Closed Block" means the ordinary life policies and certain associated riders and benefits that were issued by MetLife and included in the closed block established pursuant to MetLife's Plan of Reorganization (the "Plan of Reorganization") Under Section 7312 of the New York Insurance Law as adopted on September 28, 1999 (and as amended and restated by amendments dated November 3, 1999 and November 16, 1999 and as amended by amendment dated March 9, 2000) by the Board of Directors. These policies include the types of policies listed in Paragraph 3, which generally constitute all of the classes of United States dollar denominated ordinary life insurance policies that were issued by MetLife for which MetLife has a currently payable dividend scale. A policy is included in the closed block only if it was either (a) in force on any date between December 31, 1998 and April 7, 2000 or (b) issued after April 7, 2000 (i) pursuant to a completed application that is received prior to April 7, 2000 at MetLife's administrative offices together with all required medical and other underwriting information and payment of the full initial premium and (ii) as applied for in accordance with the terms of the application. All associated riders and benefits to any policy in the closed block are also included in the closed block, with the exception of any rider or benefit for dividend accumulations, dividends with interest or dividends left on deposit. 3. Types of Policies. The following types of policies are included in the MetLife Ordinary Life Closed Block except for policies which continue as extended term insurance: 29 32
Plan Code Description 1 Ordinary Life 3, 8 Single Premium Whole Life 100-101 Whole Life 102 Whole Life with Reduced Premium Guaranteed for 5 Years 110 Life Paid-Up at Age 75 110 Life Paid-Up at Age 70 - Intermediate - Age Corrections at Ages 66 & Over 115 15 Payment Life 120, 122 20 Payment Life 127 - 128 Juvenile 20-Payment Life 130 30-Payment Life 134 United Services - 34 Month LPL 146 United Services - 46 Month LPL 165 Life Paid-Up at Age 65 170 Life Paid-Up at Age 70 175 Life Paid-Up at Age 75 183 Whole Life Paid Up at 85 186 15-Year Income Family Protection for 20 Year 192 Double Protection 194 Life Premium Reduced 195 Mortgage Redemption on Whole Life Paid-Up at 85 Ord. Rates 200 20 PLAP 208-209 20 Payment Life 340 United Services 34-Month LPL 415 15-Year Endowment 420 20-Year Endowment 425 25-Year Endowment 430 30-Year Endowment 460 United Services 46-Month LPL 460 Endowment at Age 60 461 Retirement Income at Age 60 - Male 465 Endowment at Age 65 475 Endowment at Age 75 480 Endowment at Age 80 483 Endowment at Age 85 580 United Services 58-Month LPL 650 Double Protection 657 DP65 with Options 658-659 Double Protection at Age 65 861 Modified Endowment Life Option 861 Option Life or Endowment 881 Limited Payment Life with Deferred Annuity 902 Century 21 937 Decreasing Insurance Whole Life
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Plan Code Description 941 Life Premium Reduced 951 Mortgage Redemption Whole Life - Paid up At Age 85 Ord. Rates 960 Single Premium Paid-Up Whole Life 961 Mortgage Redemption Whole Life - Intermediate Rates 962 Single Premium Paid-Up Whole Life 965 Single Premium Paid-Up Whole Life 976 Limited Payment Life 981 Convertible Limited Payment Life Paid-Up Life Option Only 1000 Whole Life 1001 Modified Insurance Life (Economatic) 1003-1004 Executive Equity US / NY 1005 Whole Life 1006 Modified Insurance Life (Economatic) 1007 Whole Life 1008-1009 Life paid-Up at Age 88 (Executive Equity) 1010 Whole Life with Cost of Living Rider 1011 Whole Life 1012 Modified Insurance Life (Economatic) 1013-1014 Life Paid-Up at Age 85 (Executive Equity) 1015 Whole Life with Cost of Living Rider 1016 Whole Life 1017 Modified Insurance Life (Economatic) 1018-1019 Life Paid-Up at Age 85 (Executive Equity) 1020 Modified Premium Life (Estate Builder) 1021 Whole Life with Cost of Living Rider 1022 Life Paid-Up at Age 90 1023 Whole Life Reduced Premiums Guaranteed for 5 Years 1024 Whole Life Revised 1025 Modified Premium Life (Estate Builder) 1026 Whole Life with Cost of Living Rider 1027 Life Paid-UP at Age 90 1029 Whole Life Revised 1030 Joint Life 1031 Whole Life Without Extra Protection Issue ages 45 and Under 1032 Joint Life 1033 Life Paid-Up at age 90 1034 Modified Insurance Life (Economatic) 1036 Whole Life Without Extra Protection Issue ages 45 and Under 1038 Life Paid-Up at age 90 1039 Modified Insurance Life (Economatic) 1040 Whole Life 1041 Opt 15 Payment Life 1042 Whole Life With Return Of Cash Value Benefit 1043 Life Paid-Up at 90 under $10,000 1044 Whole Life with Cost of Living Rider 1045 Whole Life 1047 Whole Life With Return Of Cash Value Benefit 1048 Life Paid-Up at 90 under $10,000 1049 Whole Life with Cost of Living Rider 1050 5-Payment Life 1052 Whole Life 1053 Whole Life Paid-up at age 95
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Plan Code Description 1054 Whole Life Revised 1055 Whole Life 1057 Whole Life 1058 Whole Lie Paid-up at age 95 1059 Whole Life Revised 1064, 1069 Modified Insurance Life (Economatic) 1072 Life Paid-Up at Age 98 1074 Whole Life with Cost of Living Rider 1075 Modified Premium Life (Estate Builder) 1077 Life Paid-Up at Age 98 1079 Whole Life with Cost of Living Rider 1080 Joint Life 1081 Life Paid-Up at Age 98 1082 Joint Life 1083 Metromatic Life at Age 95 1085 Life Paid-Up at Age 98 1086 Whole Life Without Extra Protection Issue ages 45 and under 1087 Life Paid-Up at Age 98 1090 Whole Life - 8% Fixed Loan Rate 1091 Life Paid-Up at Age 90 - 8% Fixed Loan Rate 1092 Whole Life Paid-Up at Age 95 - Montana 1095 Whole Life - 8% Fixed Loan Rate 1096 Life Paid-Up at Age 90 - 8% Fixed Loan Rate 1097 Life Paid-Up at Age 98 1100, 1103 10-Payment Life 1104 Life Paid-Up at Age 98 - Group Conversion 1105, 1108 10-Payment Life 1109 Life Paid-Up at Age 98 1120-1123 Modified Insurance Life (Economatic) - without Combination Dividend Option 1124 Life Paid-Up at Age 98 1125-1128 Modified Insurance Life (Economatic) - without Combination Dividend Option 1145 Life Paid-Up at Age 98 1150 15-Payment Life 1152 Life Paid-Up at Age 98 1153 15-Payment Life 1154 Life Paid-Up at Age 98 1155 15-Payment Life 1156-1157 Life Paid-Up at Age 98 1158 15-Payment Life 1169-1170 Life Paid-Up at Age 98 1175 Life Paid-Up at Age 98 1180-1184 Life Paid-Up at Age 98 1187-1188 Life Paid-Up at Age 98 1191-1192 Life Paid-Up at Age 98 1199 Life Paid-Up at Age 98 1200-1209 20-Payment Life 1240 24-Payment Life 1250 25-Payment Life 1260 26-Payment Life 1300, 1303 30-Payment Life 1304 Life Paid-Up at Age 98
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Plan Code Description 1305 30-Payment Life 1306-1307 Life Paid-Up at Age 98 1308 30-Payment Life 1309-1312 Metromatic Whole Life 1313-1316 Metromatic Enriched Whole Life 1320 Life Paid-Up at Age 98 1321-1322 Whole Life - Group Conversions 1323-1324 Whole Life - 8% Fixed Loan Rate 1399 Life Paid-Up at Age 98 1406-1409 Voluntary Permanent Whole Life 1410-1411 Life Paid-Up at Age 98 1416-1424 Life Paid-Up at Age 98 1425-1429 Life Paid-Up at Age 98 - Group Conversions 1482-1496 Life Paid-Up at Age 98 1501 50-Payment Life 1501-1504 Qualified Whole Life 1505-1508 Qualified Life Paid-Up at 95 1520-1531 Whole Life 1532-1537 Life Paid-Up at Age 95 1538-1541 Metromatic - Whole Life 1550, 1553 Life Paid-Up at Age 55 1555, 1558 Life Paid-Up at Age 55 1571-1594 Whole Life 1600 Life Paid-Up at Age 60 1601 Life Paid-Up at Age 98 - Group Conversion 1603, 1605 Life Paid-Up at Age 60 1608 Life Paid-Up at Age 60 1620, 1625 Life Paid-Up at Age 62 1626-1649 Qualified Whole Life 1650, 1653 Life Paid-Up at Age 65 1655 Life Paid-Up at Age 65 1657-1659 Life Paid-Up at Age 65 1660-1680 Life Paid-Up at 95 1681-1688 Whole Life - Group Conversions 1689-1695 Life Paid-Up at 95 Group Conversions 1701-1704 Qualified Whole Life 1705-1708 Qualified Life Paid-Up at 95 1720-1731 Whole Life 1732-1737 Life Paid-Up at 95 1738-1741 Metromatic - Whole Life 1750, 1756 Life Paid-Up at age 75 1771-1794 Whole Life 1801-1806 Whole Life 1807-1812 Life Paid-Up at 95 1813-1833 Qualified Life Paid-Up at 95 1834-1848 Qualified Life Paid-Up at Age 98 1850-1852 Whole Life Paid-Up At Age 85 1855 Juvenile Whole Life Paid-Up at 85 1858-1859 Juvenile Whole Life Paid-Up at 85 1860-1880 Life Paid-Up at 95 1900-1907 Young Business & Professional Man's
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Plan Code Description 1910-1917 YBP Preferred Risk 1920-1922 Pension Insurance Policy 1922 Qualified Life Paid-Up at Age 90 1923 Qualified Whole Life 1923 Pension Insurance Policy 1925-1928 Pension Insurance Policy 1930 Qualified Life Paid-Up at age 90 1930-1932 Pension Insurance Policy 1932 Qualified Life Paid-Up at age 90 1933 Pension Insurance Policy 1933 Qualified Whole Life 1935-1938 Pension Life Insurance Policy 1939-1953 Qualified Life Paid-Up at Age 98 1954-1958 Life Paid-Up at Age 98 - Group Conversion 1959-1961 Qualified Whole Life 1962-1964 Qualified Life-Paid Up at 95 1965 Whole Life Group Conversion 1966 Life-Paid Up at 95 Group Conversion 1967-1970 Metromatic Whole Life (Group Managed) 1971-1974 Metromatic Enriched Whole Life (Group Managed) 1975-1978 Pension Life Insurance Policy 1978 Qualified Whole Life 1979-1984 Flexible Whole Life 1985 Pension Life Insurance Policy 1985 Qualified Life Paid-Up at age 90 1986-1987 Pension Life Insurance Policy 1987 Qualified Life Paid-Up at age 90 1988 Pension Life Insurance Policy 1988 Qualified Whole Life 1995 Flexible Whole Life- Group Conversion 2000 Whole Life Family Income 2060 Supplementary Paid-Up - Metromatic - 20 Yr. IBSR 2063 Supplementary Paid-Up - (UL) - Spouse Term Insurance Benefit 2104 Supplementary Paid-Up - 10 Yr. IBSR 2109-2110 Supplementary Paid-Up - 10 Yr. IBSR 2160 Supplementary Paid-Up - 10 Yr. IBSR 2192 Supplementary Paid-Up - Spouse 1YT (ULA-UM) 2202 10-Year Income Family Protection for 20 Years 2203 15-Year Income Family Protection for 20 Years 2203-2204 Supplementary Paid-Up - 20 Yr. IBSR 2204 20 Year Family Protection for 20 Years 2208-2209 Supplementary Paid-Up - 20 Yr. IBSR 2303-2304 Supplementary Paid-Up - 30 Yr. IBSR 2308-2309 Supplementary Paid-Up - 30 Yr. IBSR 2506-2511 Supplementary Paid-Up - 20 Yr. IBSR 2524-2529 Supplementary Paid-Up - Spouse 1 YT 2536-2541 Supplementary Paid-Up - Spouse 10 YT 2556-2557 Supplementary Paid-Up - Metromatic - Spouse 10 YT 2602-2604 Family Protection to Age 60 2616-2621 Supplementary Paid-Up - 10 Yr. IBSR 2628-2633 Supplementary Paid-Up - 30 Yr. IBSR
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Plan Code Description 2650 Whole Life Paid-Up At Age 65 Family Income 2664-2667 Supplementary Paid-Up - 10 Yr. IBSR 2672-2675 Supplementary Paid-Up - 20 Yr. IBSR 2680-2683 Supplementary Paid-Up - 30 Yr. IBSR 2706-2711 Supplementary Paid-Up - 20 Yr. IBSR 2724-2729 Supplementary Paid-Up - Spouse 1YT 2736-2741 Supplementary Paid-Up - Spouse 10 YT 2756-2757 Supplementary Paid-Up - Metromatic - Spouse 10 YT 2816-2821 Supplementary Paid-Up - 10 Yr. IBSR 2828-2833 Supplementary Paid-Up - 30 Yr. IBSR 2850 Whole Life Paid-Up at age 85 Family Income 2864-2867 Supplementary Paid-Up - 10 Yr. IBSR 2872-2875 Supplementary Paid-Up - 20 Yr. IBSR 2880-2883 Supplementary Paid-Up - 30 Yr. IBSR 4041 Opt 15 Year Endowment 4100-4109 10 Year Endowment 4150-4159 15 Year Endowment 4200-4209 20-Year Endowment 4250 25 Year Endowment 4300-4309 30-Year Endowment 4500-4509 Endowment at Age 50 4550-4559 Endowment at Age 55 4600-4609 Endowment at Age 60 4620, 4622 Endowment at Age 62 4625, 4627 Endowment at Age 62 4650-4655 Endowment at Age 65 4657-4659 Endowment at Age 65 4664 Endowment at Age 65 4700 Endowment at Age 70 4750 Endowment at Age 75 4800 Endowment at Age 80 4850 Endowment at Age 85 4853 Endowment at Age 85 4855, 4858 Endowment at Age 85 4885, 4888 Endowment at Age 88 4900-4901 Endowment at Age 90 5103 Single Premium 10-Year Endowment 5108 Single Premium 10-Year Endowment 5133 Single Premium 13-Year Endowment 5143 Single Premium 14-Year Endowment 5153 Single Premium 15-Year Endowment 5163 Single Premium 16-Year Endowment 5173 Single Premium 17-Year Endowment 5183-5184 Single Premium 18-Year Endowment 5189 Single Premium 18-Year Endowment 5193 Single Premium 19-Year Endowment 5203, 5208 Single Premium 20-Year Endowment 5213-5214 Single Premium 21-Year Endowment 5219 Single Premium 21-Year Endowment 5223 Single Premium 22-Year Endowment
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Plan Code Description 5233 Single Premium 23-Year Endowment 5243 Single Premium 24-Year Endowment 5253-5254 Single Premium 25-Year Endowment 5259 Single Premium 25-Year Endowment 5263 Single Premium 26-Year Endowment 5273 Single Premium 27-Year Endowment 5283 Single Premium 28-Year Endowment 5293 Single Premium 29-Year Endowment 5303 Single Premium 30-Year Endowment 5313 Single Premium 31-Year Endowment 5323 Single Premium 32-Year Endowment 5333 Single Premium 33-Year Endowment 5343 Single Premium 34-Year Endowment 5353 Single Premium 35-Year Endowment 5403 Single Premium 40-Year Endowment 5503 Single Premium Endowment at Age 50 5553 Single Premium Endowment at Age 55 5563 Single Premium Endowment at Age 56 5573 Single Premium Endowment at Age 57 5603 Single Premium Endowment at Age 60 5608 Endowment At Age 60 5632, 5637 Family Endowment At Age 62 5642, 5647 Family Anniversary At Age 62 5650 Endowment At Age 65 Family Income 5653, 5658 Single Premium Endowment at Age 65 5660-5667 Family Endowment at 65 5670-5672 Anniversary Family E65 5675-5677 Family Anniversary Endowment at 65 5803 Single Premium Endowment at Age 80 5851 Endowment at Age 85 Increased Indemnity 5853 Single Premium Endowment at Age 85 5860-5862 Family Endowment at Age 85 5864-5867 Family Endowment at Age 85 5870-5872 Family Anniversary Endowment at 85 5875-5877 Family Anniversary Endowment at 85 5951 Mortgage Redemption Endowment at Age 85 - Ord. Rates 5961 Mortgage Redemption Endowment at Age 85 - Int. Rates 5973-5974 Endowment Specials 5976 Endowment Specials Include Joint 20 Yr. End. 5981 Convertible Limited Payment Life - Paid-Up Endowment 6100-6102 10 Year Endowment - Individual Retirement Annuity 6105, 6107 10 Year Endowment - Individual Retirement Annuity 6170 Education-Estate Builder End. at Age 17 6180 Education-Estate Builder End. at Age 18 6190 Education-Estate Builder End. at Age 19 6200 Education-Estate Builder End. at Age 20 6200, 6202 20 Year Endowment Individual Retirement Annuity 6205, 6207 20 Year Endowment Individual Retirement Annuity 6210 Education-Estate Builder End. at Age 21 6220 Education-Estate Builder End. at Age 22 6230 Education-Estate Builder End. at Age 23
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Plan Code Description 6240 Education-Estate Builder End. at Age 24 6250 Education-Estate Builder End. at Age 25 6550-6551 Retirement Income at Age 55 6600-6601 Retirement Income at Age 60 6650 Retirement Income at Age 65 - Male 6650 Endowment at Age 65 Individual Retirement Annuity 6651 Retirement Income at Age 65 - Female 6651 Endowment at Age 65 Individual Retirement Annuity Premium Continuation Option 6655 - 6656 Endowment at Age 65 Individual Retirement Annuity Premium Continuation Option 7101 Educational Fund/Endowment Maturing in 10 Years 7111 Educational Fund/Endowment Maturing in 11 Years 7121 Educational Fund/Endowment Maturing in 12 Years 7131 Educational Fund/Endowment Maturing in 13 Years 7141 Educational Fund/Endowment Maturing in 14 Years 7151 Educational Fund/Endowment Maturing in 15 Years 7161 Educational Fund/Endowment Maturing in 16 Years 7171 Educational Fund/Endowment Maturing in 17 Years 7181 Educational Fund/Endowment Maturing in 18 Years 7191 Educational Fund/Endowment Maturing in 19 Years 7201 Educational Fund/Endowment Maturing in 20 Years 8000-8038 Survivorship Whole Life 8100 Family Security 10-Year Term 8101-8102 Joint Reducing Term Life (Joint Mortgage Term) - 10 Yr - 8% 8110 Family Security 11-Year Term 8120 Family Security 12-Year Term 8130 Family Security 13-Year Term 8140 Family Security 14-Year Term 8150 Family Security 15-Year Term 8151-8152 Joint Reducing Term Life (Joint Mortgage Term) - 15 Yr - 8% 8160 Family Security 16-Year Term 8170 Family Security 17-Year Term 8180 Family Security 18-Year Term 8190 Family Security 19-Year Term 8200 Family Security 20-Year Term 8201-8202 Joint Reducing Term Life (Joint Mortgage Term) - 20 Yr - 8% 8210 Family Security 21-Year Term 8220 Family Security 22-Year Term 8230 Family Security 23-Year Term 8240 Family Security 24-Year Term 8250 Family Security 25-Year Term 8251-8252 Joint Reducing Term Life (Joint Mortgage Term) - 25 Yr - 8% 8260 Family Security 26-Year Term 8270 Family Security 27-Year Term 8280 Family Security 28-Year Term 8290 Family Security 29-Year Term 8300 Family Security 30-Year Term 8301-8302 Joint Reducing Term Life (Joint Mortgage Term) - 30 Yr - 8% 8310 Family Security 31-Year Term 8320 Family Security 32-Year Term
37 40
Plan Code Description 8330 Family Security 33-Year Term 8340 Family Security 34-Year Term 8350 Family Security 35-Year Term 8360 Family Security 36-Year Term 8370 Family Security 37-Year Term 8380 Family Security 38-Year Term 8390 Family Security 39-Year Term 8400 Family Security 40-Year Term 8410 Family Security 41-Year Term 8420 Family Security 42-Year Term 8430 Family Security 43-Year Term 8440 Family Security 44-Year Term 8450 Family Security 45-Year Term 8460 Family Security 46-Year Term 8470 Family Security 47-Year Term 8480 Family Security 48-Year Term 8490 Family Security 49-Year Term 8500 Family Security 50-Year Term 8510 Family Security 51-Year Term 8520 Family Security 52-Year Term 8530 Family Security 53-Year Term 8540 Family Security 54-Year Term 9001-9002 Supplementary Paid-Up Spouse 9006-9007 Supplementary Paid-Up Spouse 9011-9013 General Motors Dealers 9014-9016 Guaranteed Issue Premiums Guaranteed 9017-9019 Guaranteed Issue Premiums Not Guaranteed 9054, 9059 Supplementary Paid-Up 5 YT on Surviving Spouse 9100 10 Year Mortgage Term 9102 10 Year Term with Uniform Annual Decreases 9103 10 Year Mortgage Term 9104 10 Year Mortgage/Scheduled 1 Year Term Insurance 9105 10 Year Mortgage Term 9106-9107 10 Year Term with Uniform Annual Decreases 9108-9109 10 Year Mortgage Term 9111-9112 Wholesale 1 and 2 Year Terms 9140, 9143 10 Year Term with Uniform Annual Decreases 9144-9145 10 Year Term with Uniform Annual Decreases 9147-9148 10 Year Term with Uniform Annual Decreases 9150 15-Year Mortgage Term 9152 15 Year Single Life Decreasing Term 9153 15 Year Mortgage Term 9154 15 Year Mortgage/Scheduled 1 Year Term Insurance 9155 15 Year Mortgage Term 9156 15 Year Term Annual Decreases 9157 15 Year Mortgage/Scheduled 1 Year Term Insurance 9158-9159 15 Year Mortgage Term 9190, 9193 15 Year Term with Uniform Annual Decreases 9194-9195 15 Year Term with Uniform Annual Decreases 9197-9198 15 Year Term with Uniform Annual Decreases 9200 20-Year Mortgage Term
38 41
Plan Code Description 9202 20 Year Single Life Decreasing Term 9203-9209 20 Year Mortgage Term 9240 20 Year Term with Uniform Annual Decreases 9243-9245 20 Year Term with Uniform Annual Decreases 9247-9248 20 Year Term with Uniform Annual Decreases 9250 25-Year Mortgage Term 9251 Mortgage Term with Premiums Payable for Entire duration of Ins. Coverage 9252 25 Year Term with Uniform Annual Decreases 9253 25 Year Mortgage Term 9254 25 Year Mortgage/Scheduled 1 Year Term Insurance 9255 25 Year Mortgage Term 9256 25 Year Single Life Decreasing Term 9257 25 Year Mortgage/Scheduled 1 Year Term Insurance 9258-9259 25 Year Mortgage Term 9290, 9293 25 Year Term with Uniform Annual Decreases 9294-9295 25 Year Term with Uniform Annual Decreases 9297-9298 25 Year Term with Uniform Annual Decreases 9300 30-Year Mortgage Term 9301 Mortgage Term with Premiums Payable for Entire Duration of Insurance Coverage 9302 30 Year Term with Uniform Annual Decreases 9303 30 Year Mortgage Term 9304 30 Year Mortgage/Scheduled 1 Year Term Insurance 9305 30 Year Mortgage Term 9306 30 Year Term Uniform Annual Decreases - 71 Rates 9307 30 Year Schedule Mortgage Term 9307-9309 30 Year Mortgage Term 9311-9312 1 Yr Term Insurance Cost of Living Policy with CPI Increases 9313 One Year Renewable Term Policy 9314 One Year Renewable Convertible 9316-9317 1 Yr Term Insurance Cost of Living Policy with CPI Increases 9318-9320 One Year Renewable Convertible Term Policy 9325 One Year Renewable Convertible 9340, 9343 30 Year Term with Uniform Annual Decreases 9344-9345 30 Year Term with Uniform Annual Decreases 9347-9348 30 Year Term with Uniform Annual Decreases 9353 5 Year Renewable Non-Convertible Term 9353-9354 5 Year Renewable Convertible term 9358-9359 5 Year Renewable Convertible term 9402-9403 10 Year Renewable Convertible Term 9404 10 Year Convertible Non-Renewable 9407-9408 10 Year Renewable Convertible Term 9409 10 Year Convertible Non-Renewable 9453 15-Year Renewable Term 9454 15 Year Convertible Non-Renewable Term 9503 20-Year Renewable Term 9510-9515 Term Specials 9650 Term to Age 65 9652 Uniform Annual Decreasing Term to Age 65 9653 Supplementary Paid-Up on Wife $5000 Basis 9653 Term to Age 65 9654 Supplementary Paid-Up Term 65 on Surviving Spouse (Spouse is a Male)
39 42
Plan Code Description 9655 Supplementary Paid-Up on Wife $5000 Basis 9656 Uniform Annual Decreasing Term to Age 65 - 71 Rates 9658 Term to Age 65 9659 Supplementary Paid-Up Term 65 on Surviving Spouse (Spouse is a Female) 9660, 9663 Supplementary Paid-Up E65 Family 9665, 9668 Supplementary Paid-Up E65 Family 9690, 9693 Uniform Annual Decreasing Term to Age 65 9694 9695 Uniform Annual Decreasing Term to Age 65 9697, 9698 Uniform Annual Decreasing Term to Age 65 9710-9715 Term Specials 9725, 9728 Uniform Annual Decreasing Term To Age 65 9853, 9855 Supplementary Paid-Up on Wife - Family E85 9860, 9863 Supplementary Paid-Up on Husband - Family E85 with Income Benefit 9865, 9868 Supplementary Paid-Up on Wife - Family E85 with Income Benefit 9870 Term and Annuity 9950 Mortgage Redemption Term, Ordinary Rates 9960 Mortgage Redemption Term, Intermediate Rates 9971, 9973 Term Specials 9976, 9978 Term Specials
40 43 SCHEDULE B EXISTING REINSURANCE
UNIQUE IDENTIFIER EFFECTIVE NAIC GROUP NAIC FEDERAL ID NAME OF REINSURER TYPE OF DATE CODE COMPANY NUMBER REINS. CODE C1.010198.41-1366075.YRT 01/01/98 761 90611 41-1366075 ALLIANZ LIFE INS. CO. OF NORTH AMER YRT/I C1.040177.41-1366075.YRT 04/01/77 761 90611 41-1366075 ALLIANZ LIFE INSURANCE COMPANY OF N YRT/I C1.021577.44-0188050.YRT 02/15/77 1169 61492 44-0188050 BUSINESS MEN'S ASSURANCE COMPANY YRT/I C1.010177.36-0947200.YRT 01/01/77 218 62413 36-0947200 CNA INSURANCE COMPANIES YRT/I C1.030171.13-2572994.YRT 03/01/71 80 86258 13-2572994 COLOGNE LIFE REINSURANCE YRT/I C1.070153.06-0303370.YRT 07/01/53 901 62308 06-0303370 CONNECTICUT GENERAL LIFE INSURANCE YRT/I C1.010198.36-0947200.YRT 01/01/98 218 62413 36-0947200 CONTINENTAL ASSURANCE COMPANY YRT/I C1.010198.36-0947200.YRT 01/01/98 218 62413 36-0947200 CONTINENTAL ASSURANCE COMPANY YRT/I C1.020185.48-1024691.YRT 02/01/85 350 68276 48-1024691 EMPLOYERS REASSURANCE CORPORATION YRT/I C1.123192.AA-1460045.YRT 12/31/92 AA-1460045 EURPOPAISHE ALLGEMINE RUCKUERS YRT/I C1.080196.62-1003368.YRT 08/01/96 604 87017 62-1003368 GERLING GLOBAL LIFE REINSURANCE COM YRT/I C1.010198.62-1003368.YRT 01/01/98 604 87017 62-1003368 GERLING GLOBAL LIFE REINSURANCE COM YRT/I C1.080196.AA-1560034.YRT 08/01/96 AA-1560034 LA MUTUELLE DU MANS ASSURANCE YRT/I C1.100176.35-0472300.YRT 10/01/76 20 65676 35-0472300 LINCOLN NATIONAL LIFE INSURANCE COM YRT/I C1.040177.58-0828824.YRT 04/01/77 361 66346 58-0828824 MUNICH AMERICAN REASSURANCE COMPANY YRT/I C1.021877.06-0493340.YRT 02/18/77 403 67814 06-0493340 PHOENIX HOME LIFE MUTUAL INSURANCE YRT/I C1.010189.43-1235868.YRT 01/01/89 241 93572 43-1235868 RGA REINSURANCE COMPANY YRT/I C1.010198.84-0499703.YRT 01/01/98 229 68713 84-0499703 SECURITY LIFE OF DENVER INSURANCE C YRT/I C1.011166.22-1211670.YRT 01/11/66 22-1211670 SERVICEMEN'S GROUP LIFE INSURANCE C YRT/I C1.080196.13-1562932.YRT 08/01/96 181 67016 13-1562932 SWISS RE LIFE (MERCANTILE & GENERA YRT/I C1.040177.13-1562932.YRT 04/01/77 181 67016 13-1562932 SWISS RE LIFE COMPANY AMERICA YRT/I C1.010198.13-1562932.YRT 01/01/98 181 67016 13-1562932 SWISS RE LIFE COMPANY AMERICA YRT/I C1.033077.13-1562932.YRT 03/30/77 181 67016 13-1562932 SWISS RE LIFE COMPANY AMERICA (M&G) YRT/I C1.030169.13-1562932.YRT 03/01/69 181 67016 13-1562932 SWISS RE LIFE COMPANY AMERICA (SBL) YRT/I C1.032889.13-1562932.YRT 03/28/89 181 67016 13-1562932 SWISS RE LIFE COMPANY AMERICA(LIFER YRT/I C1.010198.13-1562932.YRT 01/01/98 181 67016 13-1562932 SWISS RE LIFE COMPANY AMERICA(LIFER YRT/I C1.112183.38-0397420.YRT 11/21/83 509 80659 38-0397420 THE CANADA LIFE ASSURANCE COMPANY YRT/I C1.030177.95-1060502.YRT 03/01/77 468 67121 95-1060502 TRANSAMERICA OCCIDENTAL LIFE INSURA YRT/I C1.080196.95-1060502.YRT 08/01/96 468 67121 95-1060502 TRANSAMERICA OCCIDENTAL LIFE INSURA YRT/I C1.010198.95-1060502.YRT 01/01/98 468 67121 95-1060502 TRANSAMERICA OCCIDENTAL LIFE INSURA YRT/I C1.010177.AA-1122019.YRT 01/01/77 AA-1122019 WORLD WIDE REASSURANCE COMPANY LTD. YRT/I
41 44 SCHEDULE C RESERVES 1. Statutory Reserve. The term "Statutory Reserve", as used in this Agreement with respect to the Policies, means (a) - (b) where: (a) is the sum of the following items that pertain to reinsurance liabilities hereunder: (i) Aggregate reserve as shown on line 1 of page 3 of the Annual Statement; (ii) Dividends as shown on line 7.1 of page 3 of the Annual Statement; (iii) Premiums paid in advance as shown on line 9 of page 3 of the Annual Statement; (iv) Interest Maintenance Reserve as shown on line 11.4 of page 3 of the Annual Statement, allowing negative balances to the extent that such negative balances are offset by other positive balances in MetLife's company-wide calculation of Interest Maintenance Reserve; and (v) Allocated Asset Valuation Reserve calculated according to Paragraph 3 below; and (b) is the net deferred and uncollected premiums as shown in line 15 of page 2 of the Annual Statement. 2. Modified Coinsurance Reserve. The "Modified Coinsurance Reserve" equals each Reinsurer's quota share of the Statutory Reserve. 3. Allocated Asset Valuation Reserve. The "Allocated Asset Valuation Reserve" will be divided into subcomponents corresponding to the subcomponents of MetLife's Asset Valuation Reserve as presented on page 41 of the Annual Statement, namely the "fixed income other than mortgage loan" subcomponent, the "mortgage loan" subcomponent, the "common stock" subcomponent and the "real estate and other invested asset" subcomponent, each of which represents the portion of the corresponding subcomponent of MetLife's Asset Valuation Reserve that is allocable to the Asset Portfolio. At the date of this Agreement, each subcomponent of the Allocated Asset Valuation Reserve will equal (a) times (b) divided by (c), where: 42 45 (a) equals MetLife's total Asset Valuation Reserve as of the end of the calendar quarter first prior to the date of this Agreement for the corresponding subcomponent; (b) equals the Reserve Objective for such subcomponent of the Asset Portfolio calculated using the NAIC procedures for the calculation of the Asset Valuation Reserve as of the end of the calendar quarter first prior to the date of this Agreement; and (c) equal MetLife's Reserve Objective as of the end of the calendar quarter first prior to the date of this Agreement for the corresponding subcomponent. At the end of each Accounting Period thereafter the subcomponent of the Allocated Asset Valuation Reserve will be rolled forward as though the Asset Portfolio represented the assets of a standalone company using the rules applicable to the Asset Valuation Reserve; provided, however, that: (1) the tax rate used in calculating Realized Capital Gains/(Losses) Net of Taxes, as shown on lines 2 and 2a of page 41 of the Annual Statement, will be the marginal tax rate in effect at the time used by MetLife in the calculation of its company-wide Asset Valuation Reserve; (2) Transfers between the default and equity components, as shown on line 10 of page 41 of the Annual statement, will be calculated if, at the end of the prior Accounting Period, the Memorandum Account as described in Article VII, Paragraph 9 is zero; and (3) Voluntary Contributions, as shown on line 11 of page 41 of the Annual Statement, will be set to zero. 43 46 SCHEDULE D MODIFIED COINSURANCE RESERVE INVESTMENT CREDIT 1. Modified Coinsurance Reserve Investment Earned Rate. The Modified Coinsurance Reserve Investment Rate for any Accounting Period will be equal to (a) / [(b)-.5x(a)], where: (a) equals the net investment income and realized and unrealized capital gains and losses, calculated by MetLife in accordance with Exhibit 2, Exhibit 3 and Exhibit 4 of the Annual Statement, during the current Accounting Period with respect to the Asset Portfolio, described in Schedule E; and (b) equals the average of the statutory values of the assets in the Asset Portfolio as of the beginning and the end of the Accounting Period. For purposes of this section, the statutory value of the assets in the Asset Portfolio includes accrued investment income less the amount of any borrowing associated with the closed block. 2. Modified Coinsurance Reserve Investment Credit. The Modified Coinsurance Reserve Investment Credit for any Accounting Period will be equal to the Modified Coinsurance Reserve Investment Rate determined according to Paragraph 1 times the Modified Coinsurance Reserve as of the beginning of the accounting period. 3. Item 1(a) of the Modified Coinsurance Reserve Investment Earned Rate formula, described above, will not be adjusted for income taxes or changes in any provision for income taxes. 44 47 SCHEDULE E ASSET PORTFOLIO 1. Asset Portfolio. The Asset Portfolio is composed of those assets supporting the policies described in Schedule A the statement value of which will at all times equal or exceed the Statutory Reserve, as defined in Schedule C. The Asset Portfolio consists of: (a) all assets in the MetLife Ordinary Life Closed Block portfolio, and (b) additional assets maintained in separately identified segments outside of the MetLife Ordinary Life Closed Block portfolio. 2. MetLife will retain, control and own all assets held in the Asset Portfolio. Throughout the duration of this Agreement, the Asset Portfolio will continue to be managed in accordance with the laws and regulations of MetLife's domiciliary jurisdiction and the guidelines promulgated by MetLife's Board of Directors. 3. At inception, MetLife shall promptly identify to the Reinsurers (a) any assets for which no Asset Valuation Reserve component exists and (b) any derivatives in the Asset Portfolio that do not specifically hedge another asset in the Asset Portfolio. MetLife shall promptly notify the Reinsurers at any time that an asset of the type described in (a) or a derivative described in (b) above is added to or deleted from the Asset Portfolio. 45 48 SCHEDULE F CEDING COMMISSIONS 1. The Ceding Commission Percent is a function of the calendar year of the Accounting Period as set forth in the following table: 2000 - 4.36% 2001 - 3.07% 2002 - 2.09% 2003 - 1.37% 2004 - 1.32% 2005 - 1.28% 2006 - 1.25% 2007 - 1.22% 2008 and later - 1.20% 46 49 SCHEDULE G QUARTERLY REPORT FORMAT
SAMPLE QUARTERLY STATEMENT OF ACTIVITY Annual 100% Met Reinsurer's Statement Ordinary Quota Share Reference Closed Block Quota Share 0.00% 1. Reinsurance premiums a. Direct Premium Exh. 1, line 20a b. Premiums due under Existing Reinsurance Exh. 1, line 20c c. Total reinsurance premium = a - b 2. Benefit payments a. Death benefits p4, line 8 b. Maturity values p4, line 9 c. Disability Benefits p4, line 11 d. Surrender values p4, line 12 e. Interest on policy and contract funds p4, line 14 f. Policyholder dividends p4, line 28 g. Total benefit payments = a + b + c + d + e + f 3. Commissions and allowances a. % of premium ceding commission for the year b. Number of in-force policies at the end of the prior accounting period c. State and local premium taxes, including franchise p4, line 23 taxes to the extent measured solely by premiums and additive state income taxes d. Total commissions and allowances = (a x 1a ) + ($10 x b) + c 4. Modco adjustment a. Modco reserve at the end of the current accounting period b. Modco reserve at the end of the prior accounting period c. Modco investment credit = (line 4 from Modco Investment Credit worksheet) x 4b above d. Modco adjustment = a - b - c 5. Experience Refund a. Risk charge b. Memorandum Account at the end of the prior accounting period c. Applicable interest rate on the Memorandum Account 0.00% d. Experience Refund due = 1c - 2g - 3d - 4d - a - b x (1 + c), not less than $0 6. Quarterly cash settlement = 1c - 2g - 3d - 4d - 5d 7. Memorandum Account = 5b x (1 + 5c) - 1c + 2g + 3d + 4d + 5a, not less than $0 8. Statutory Reserve and Liability net of deferred and uncollected premiums end of current accounting period a. Reserve for life policies and contracts p3, line 1, EOP b. Dividend liability p3, line 7.1, EOP c. Premiums paid in advance p3, line 9, EOP d. Interest Maintenance Reserve p3, line 11.4, EOP e. Asset Valuation Reserve p41, line 13, EOP f. Deferred and uncollected premium p2, line 15, EOP g. Statutory Reserve EOP = a + b + c + d + e - f 9. Statutory Reserve and Liability net of deferred and uncollected premiums end of prior accounting period a. Reserve for life policies and contracts p3, line 1, BOP
47 50 b. Dividend liability p3, line 7.1, BOP c. Premiums paid in advance p3, line 9, BOP d. Interest Maintenance Reserve p3, line 11.4, BOP e. Asset Valuation Reserve p41, line 13, BOP f. Deferred and uncollected premium p2, line 15, BOP g. Statutory Reserve BOP = a + b + c + d + e - f 48 51
SAMPLE QUARTERLY CALCULATION OF MODCO INVESTMENT Annual MetLife Additional Total CREDIT Statement Ordinary Assets Reference Closed Block 1. Assets end of accounting period a. Subtotal invested assets end of p2, line 11, accounting period EOP b. Investment income due and accrued end p2, line 17, of accounting period EOP c. Borrowed money and interest thereon p3, line 22, end of accounting period EOP d. Assets end of period = a + b - c 2. Assets end of prior accounting period a. Subtotal invested assets end of prior p2, line 11, accounting period BOP b. Investment income due and accrued end p2, line 17, of prior account period BOP c. Borrowed money and interest thereon p3, line 22, end of prior accounting period BOP d. Assets end of prior accounting period = a + b - c 3. Investment income a. Net investment income P4, line 4 b. Realized capital gains before tax Exh. 3, line 9, col 4 c. Unrealized capital gains Exh. 4, line 9, col 4 d. Investment income = a + b + c 4. Modco investment earned rate = 3d / (.5 x (1d + 2d - 3d)) 0.00%
49 52
Sample Quarterly Report - Invested Assets Annual Statement MetLife Additional Total End of Accounting Period Reference Ordinary Assets Closed Block Bonds p2, line 1, EOP Preferred stock p2, line 2.1, EOP Common stock p2, line 2.2, EOP Mortgage loans - First liens p2, line 3.1, EOP Mortgage loans - Other than first p2, line 3.2, EOP liens Properties occupied by the company p2, line 4.1, EOP Properties acquired in satisfaction p2, line 4.2, EOP of debt Investment real estate p2, line 4.3, EOP Policy loans p2, line 5, EOP Premium notes p2, line 6, EOP Cash and short term investments p2, line 7, EOP Other invested assets p2, line 8, EOP Receivable for securities p2, line 9, EOP Aggregate write-in p2, line 10, EOP Subtotal Invested Assets
Sample Quarterly Report - Invested Assets Annual Statement MetLife Additional Total End of Prior Accounting Period Reference Ordinary Assets Closed Block Bonds p2, line 1, BOP Preferred stock p2, line 2.1, BOP Common stock p2, line 2.2, BOP Mortgage loans - First liens p2, line 3.1, BOP Mortgage loans - Other than first p2, line 3.2, BOP liens Properties occupied by the company p2, line 4.1, BOP Properties acquired in satisfaction p2, line 4.2, BOP of debt Investment real estate p2, line 4.3, BOP Policy loans p2, line 5, BOP Premium notes p2, line 6, BOP Cash and short term investments p2, line 7, BOP Other invested assets p2, line 8, BOP Receivable for securities p2, line 9, BOP Aggregate write-in p2, line 10, BOP Subtotal Invested Assets
50 53 INTERESTS AND LIABILITIES CERTIFICATE 51 54 INTERESTS AND LIABILITIES CERTIFICATE Under and Part of the REINSURANCE AGREEMENT Dated as of October 1, 2000 Between METROPOLITAN LIFE INSURANCE COMPANY AND MUNICH AMERICAN REASSURANCE COMPANY This Interests and Liabilities Certificate, which is effective as of the date of the within Reinsurance Agreement (the "Agreement"), certifies: 1. Quota Share. The Reinsurer's quota share shall be ten percent (10%). 2. Expense and Risk Charge. The Expense and Risk Charge for an Accounting Period shall equal the sum of (a) thirty five ten thousanths percent (0.0035%) times the Modified Coinsurance Reserve as of the beginning of the Accounting Period and (b) the reasonable cost of limiting, reducing or mitigating risk exposure of any assets described in Schedule E, paragraph 3. 3. Current Ratings. The Reinsurer's current A.M. Best, Standard and Poor's and Moody's ratings are as follows: A.M. Best A+; Standard & Poor's AAA; and not rated by Moody's. 4. Tax Status. The Reinsurer represents and warrants that it is subject to U. S. taxation under Subchapter L of Chapter 1 of the Code or Subpart F of Part III of Subchapter N of Chapter 1 of the Code. 5. New York Authorization. The Reinsurer represents and warrants that it is an authorized insurer in the State of New York; provided, further, that the Reinsurer shall notify MetLife within five (5) days of any change in that status and, in the event that the Reinsurer ceases to be an authorized insurer in the State of New York and fails, before the as of date of the next MetLife quarterly or annual financial statements, to provide an LOC or Trust that would support MetLife's statement credit, if required by MetLife, 51 55 then MetLife shall have a right to recapture as otherwise provided in Article VIII, Paragraph (3). 6. Address. The Address of the Reinsurer is: Munich American Reassurance Company, 56 Perimeter Center East, N.E., Atlanta, Georgia 30346-2290. IN WITNESS WHEREOF, the Reinsurer has caused this Certificate to be signed as of the date of the Agreement. By:__________________ Title:________________ 52 56 INTERESTS AND LIABILITIES CERTIFICATE Under and Part of the REINSURANCE AGREEMENT Dated as of October 1, 2000 Between METROPOLITAN LIFE INSURANCE COMPANY AND EUROPEAN REINSURANCE COMPANY OF ZURICH ACTING THROUGH ITS BERMUDA BRANCH This Interests and Liabilities Certificate, which is effective as of the date of the within Reinsurance Agreement (the "Agreement"), certifies: 1. Quota Share. The Reinsurer's quota share shall be forty five percent (45%). 2. Expense and Risk Charge. The Expense and Risk Charge for an Accounting Period shall equal the sum of (a) three one thousanths percent (0.003%) times the Modified Coinsurance Reserve as of the beginning of the Accounting Period and (b) the reasonable cost of limiting, reducing or mitigating risk exposure of any assets described in Schedule E, paragraph 3. 3. Current Ratings. The Reinsurer's current A.M. Best, Standard and Poor's and Moody's ratings are respectively as follows: A++ Superior, AAA and Aaa. 4. Tax Status. The Reinsurer represents and warrants that it is not subject to U. S. taxation under Subchapter L of Chapter 1 or the Code or Subpart F of Part III of Subchapter N of Chapter 1 of the Code. 5. New York Authorization. The Reinsurer represents and warrants that it is not an authorized insurer in the State of New York; provided, further, that the Reinsurer shall notify MetLife within five (5) days of any change in that status. 51 57 6. Address. The Address of the Reinsurer is: European Reinsurance Company of Zurich, 8 Par La Ville Rd, Hamilton Bermuda, HM08 IN WITNESS WHEREOF, the Reinsurer has caused this Certificate to be signed as of the date of the Agreement. By:__________________ Title:_________________ 52 58 INTERESTS AND LIABILITIES CERTIFICATE Under and Part of the REINSURANCE AGREEMENT Dated as of October 1, 2000 Between METROPOLITAN LIFE INSURANCE COMPANY AND ZURICH INSURANCE COMPANY, BERMUDA BRANCH This Interests and Liabilities Certificate, which is effective as of the date of the within Reinsurance Agreement (the "Agreement"), certifies: 1. Quota Share. The Reinsurer's quota share shall be five percent (5%). 2. Expense and Risk Charge. The Expense and Risk Charge for an Accounting Period shall equal the sum of (a) thirty three ten thousanths percent (0.0033%) times the Modified Coinsurance Reserve as of the beginning of the Accounting Period and (b) the reasonable cost of limiting, reducing or mitigating risk exposure of any assets described in Schedule E, paragraph 3. 3. Current Ratings. The Reinsurer's current A.M. Best, Standard and Poor's and Moody's ratings are respectively as follows: A+, AA and Aa1. 4. Tax Status. The Reinsurer represents and warrants that it is not subject to U. S. taxation under Subchapter L of Chapter 1 of the Code or Subpart F of Part III of Subchapter N of Chapter 1 of the Code. 5. New York Authorization. The Reinsurer represents and warrants that it is not an authorized insurer in the State of New York; provided, further, that the Reinsurer shall notify MetLife within five (5) days of any change in that status. 51 59 6. Address. The Address of the Reinsurer is: Zurich Insurance Company, Bermuda Branch, The Zurich Centre, 90, Pitt's Bay Road, Pembroke, HM 08, Bermuda. IN WITNESS WHEREOF, the Reinsurer has caused this Certificate to be signed as of the date of the Agreement. By:__________________ Title:_________________ 52 60 INTERESTS AND LIABILITIES CERTIFICATE Under and Part of the REINSURANCE AGREEMENT Dated as of October 1, 2000 Between METROPOLITAN LIFE INSURANCE COMPANY AND SECURITY LIFE OF DENVER INTERNATIONAL LTD. This Interests and Liabilities Certificate, which is effective as of the date of the within Reinsurance Agreement (the "Agreement"), certifies: 1. Quota Share. The Reinsurer's quota share shall be thirty percent (30%). 2. Expense and Risk Charge. The Expense and Risk Charge for an Accounting Period shall equal the sum of (a) the Expense and Risk Charge Percent set forth in Paragraph 3 below times the Modified Coinsurance Reserve as of the beginning of the Accounting Period and (b) the reasonable cost of limiting, reducing or mitigating risk exposure of any assets described in Schedule E, Paragraph 3. 3. Expense and Risk Charge Percent. (a) The Expense and Risk Charge Percent is a function of the Risk-Based Capital Ratio described in (d) below as set forth in the following table:
Risk-Based Capital Ratio Expense and Risk Charge Percent 0.10 or less - 0.0027% greater than 0.10 and 0.12 or less - 0.0054% greater than 0.12 and 0.14 or less - 0.0108% greater than 0.14 and 0.20 or less - 0.0229% greater than 0.20 and 0.25 or less - 0.0500% greater than 0.25 - 0.1043%
51 61 (b) The Risk-Based Capital Ratio will be calculated as of December 31 of every calendar year and will apply to Accounting Periods in the following calendar year. The Risk-Based Capital Ratio will remain in effect for the full calendar year unless the Trigger for Quarterly Recalculation prescribed in (c) below is greater than 10%. If such test is greater than 10% at the end of any Accounting Period, the Risk-Based Capital Ratio will be recalculated and will remain in effect for the remaining Accounting Periods of the calendar year, unless it is superseded by another Trigger for Quarterly Recalculation which is greater than 10%. For the calendar year 2000, the Risk-Based Capital Ratio will be calculated on October 1, 2000. (c) Trigger for Quarterly Recalculation. The Trigger for Quarterly Recalculation, calculated at the end of every Accounting Period other than December 31, is equal to the sum of the amounts defined in (iii) below over all invested asset categories identified in Schedule G of this Agreement. (i) At the end of an Accounting Period other than December 31, for each asset category identified in Schedule G, (i) is equal to the amount of assets described in Schedule E, Paragraph 1(b) in such asset category divided by the total amount of assets described in Schedule E, Paragraph 1(b). (ii) For each asset category identified in Schedule G, (ii) is equal to the amount of assets described in Schedule E, Paragraph 1(b) divided by the total amount of assets described in Schedule E, Paragraph 1(b) as of December 31 of the preceding calendar year. (iii) For each asset category identified in Schedule G, (iii) is equal to (i) - (ii) as described above, but not less than zero. (d) Risk-Based Capital Ratio. The Risk-Based Capital Ratio is equal to the C-1 Component of the risk-based capital formula defined in the 1999 NAIC Risk-Based Capital for Insurers Model Act applied to the assets defined in Schedule E, Paragraph 1(b) of the Agreement divided by the amount of assets defined in Schedule E, Paragraph 1(b). If the amount of assets defined in Schedule E, Paragraph 1(b) is zero, the Risk-Based Capital Ratio is set to zero. 4. Current Ratings. Since the Reinsurer is not rated by A.M. Best, Standard and Poor's and Moody's, the provisions of Article VIII Paragraph 3(b) and Article XI 52 62 Paragraph 3 shall apply to the ratings of NAME OF COMPANY, an affiliate of the Reinsurer; provided, however, that if NAME OF COMPANY, shall (a) cease to be an affiliate of the Reinsurer; (b) at any time on or after December 31, 2000 not be rated by Standard and Poor's for financial strength; or (c) at any time on or after December 31, 2000 have a financial strength rating by Standard and Poor's of A or lower, then MetLife may within one hundred and eighty (180) days, in its discretion, elect to recapture all the outstanding liabilities ceded to the Reinsurer and such recapture will be subject to the payment of a Terminal Accounting and Settlement as described in Article IX; provided, however, that the parties may agree to substitute, without a break in protection, another affiliate of the Reinsurer for this purpose; and provided, further, if these agencies shall, at any time, assign ratings to the Reinsurer, the parties may then agree that the specified Articles shall, thereafter, apply to the ratings of the Reinsurer. 5. Tax Status. The Reinsurer represents and warrants that it is subject to U. S. taxation under Subchapter L of Chapter 1 of the Code or Subpart F of Part III of Subchapter N of Chapter 1 of the Code. 6. New York Authorization. The Reinsurer represents and warrants that it is not an authorized insurer in the State of New York; provided, further, that the Reinsurer shall notify MetLife within five (5) days of any change in that status. 7. Address. The Address of the Reinsurer is: Security Life of Denver International Ltd., Continental Building, 25 Church Street, P.O. Box HM 1978, Hamilton HM HX Bermuda. IN WITNESS WHEREOF, the Reinsurer has caused this Certificate to be signed as of the date of the Agreement. By:__________________ Title:_________________ 53