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R2023-249 2023-10-09DocuSign Envelope ID: 8C3F1B40-79F0-4FFF-B918-2DC67EA8ECD2 RESOLUTION NO. R2023-249 A Resolution of the City Council of the City of Pearland, Texas, renewing the purchase of Workers Compensation Excess Insurance Coverage with Midwest Employers, in the amount of $154,272.00, for the period of October 1, 2023 through September 30, 2024. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: Section 1. Pursuant to Chapter 252 of the Local Government Code the City obtained Workers Compensation Excess Insurance Coverage. Section 2. That the City Council hereby renews a contract, for Workers Compensation Excess Insurance Coverage, with Midwest Employers in the amount of $154,272.00. Section 3. The City Manager or his designee is hereby authorized to execute a contract for the purchase of Workers Compensation Excess Insurance Coverage. PASSED, APPROVED and ADOPTED this the 9t1 day of October, A.D., 2023. ATTEST: DocuSigned by: Fran,ws QOLar FR REtTAGUILAR, TRMC, MMC CITY SECRETARY APPROVED AS TO FORM: DocuSigned by: '�. DARRIN M.13e'k8Q8@1�tFC.4g,6OKER CITY ATTORNEY DocuSigned by: rpze B^881A61503F1F2... J. KEVIN COLE MAYOR ‚4!!Midwest Employers � � Casually Company A BERKLEY COMPANY® Policy No.: EWC009753 Individual Self -Insured Excess Workers' Compensation and Employers Liability Indemnity Policy Schedule Page Indemnity Coverage Provided: Specific and Aggregate Excess Workers' Compensation and Employers Liability Indemnity 1. Insured: City of Pearland 2 Mailing Address: 3519 Liberty Drive Pearland, TX 77581- 3. Named States: Texas 4. Excluded States: None 5. Policy Period: (a) From: 10/01/2023 (b) To: 10/01/2024 Both days start at 12.01 A.M. standard time at the Insured's address shown in Item 2 of this schedule. 6. Specific Retention: (a) Each Accident: (b) Each Employee for Disease: See Endorsement See Endorsement 7. Specific Limit Each Accident: (a) Policy Part One, Workers' Compensation: STATUTORY (b) Policy Part Two, Employers Liability: $1,000,000 8. Specific Limit Each Employee for Disease: (a) Policy Part One, Workers' Compensation: STATUTORY (b) Policy Part Two, Employers Liability: $1,000,000 9. Aggregate Retention: (a) Rate as a Percentage of Normal Premium: (b) Estimated Normal Premium: (c) Minimum Retention: (d) Aggregate Loss Limitation: 334.77% $615,832 $2, 020, 388 $500,000 10. Aggregate Limit: $1,000,000 11. Classification of Operations: (a) Experience Modification Factor (b) Other Modification Factor: CMB-SCH (8-13) See Endorsement 1.000000000 1.000000000 14755 North Outer Forty Drive, Suite 300 Chesterfield, MO 63017 Page 1 of 2 (636) 449-7000 www.mwecc.com ‚4!!�IMidwest Employers ca5ually Company A BERKLEY COMPANY® 12 Premium: (a) Rate per $100 of Payroll: (b) Policy Minimum Premium: (c) Total Estimated Policy Premium: (d) Deposit Premium: (e) Deposit Flat Charges: (f) Total Deposit Premium and Flat Charges Payable as Follows: 13. Endorsement Serial Numbers: 14. Service Company: Individual Self -Insured Excess Workers' Compensation and Employers Liability Indemnity Policy Schedule Page 2719 $138,845 $154,272 $154,272 n/a $154,272 See Endorsement Schedule CCMSI 1500 City West, Ste. 120 Houston, TX 77042- Countersigned MIDWEST EMPLOYERS CASUALTY COMPANY 'I- Licensed Resident Agent Date Authorized Representative CMB-SCH (8-13) 14755 North Outer Forty Drive, Suite 300 Chesterfield, MO 63017 (636) 449-7000 www.mwecc.com Page 2of2 ralMidwest caEmployers A BERKLEY COMPANYct Named Insured: City of Pearland Policy Term: 10/01/2023 to 10/01/2024 Policy No.: EWC009753 Date Description Edition Date Expiration Effective Created Endorsement Date Date Code CMB-6-CLS (08-13) 10/01/2023 07/31/2023 CMB-11 (08-13) 10/01/2023 07/31/2023 CMB-199 (01-20) 10/01/2023 07/31/2023 (08-13) 10/01/2023 07/31/2023 ISI-254-EXC CMB-TX (08-13) 10/01/2023 07/31/2023 I S I -TX-A (10-16) 10/01/2023 07/31/2023 (08-13) 10/01/2023 07/31/2023 CMB-TX-EL CMB-ES (8-13) Endorsement Schedule Page 1 of 1 Date Printed: 07/31/2023 F1ll MidwesteEmployers any A BERKLEY COMPANYci: Endorsement Effective: 10/01 /2023 Policy No.: EWC009753 Named Insured: City of Pearland Endorsement Amendment to Schedule Item 6 Schedule Item 6 is amended to read as follows: 6. Specific Retention: Classification Specific Retention 7704 $750, 000 $750, 000 7720 All Other $550,000 The term "All Other" refers to any class code on the Policy which is not specifically named above. If an accident involves multiple Employees in separate classifications with different Specific Retentions, then the greatest of the Specific Retentions will apply. Countersigned orized Rep es-ntative MIDWEST EMPLOYERS CASUALTY COMPANY Secretary • • J • President This endorsement forms part of the Policy to which attached, effective on the inception date of the Policy unless otherwise stated herein. All other terms and conditions of the Policy remain unchanged. CMB-6-CLS (8-13) Date Printed: 07/31/2023 ‚4! f �d co1� Casualtymn� A BERKLEY COMYANY'a Endorsement Effective: Policy No.: Named Insured: 10/01/2023 EWC009753 City of Pearland Endorsement Amendment to Schedule Item 11 Schedule Item 11 is amended to read as follows: 11. Classification of Operations: State Code TX TX TX TX TX TX TX TX TX TX TX TX TX TX TX TX 4511 5190 5191 5506 7380 7520 7580 7704 7720 8107 8601 8742 8810 8831 9015 9102 CMB-11 (8-13) Classification ANALYTICAL CHEMIST ELECTRICAL WIRING -WITHIN BLDG OFFICE MACHINE OR APPLIANCE STREET OR ROAD CONSTRUCTION CHAUFFEURS & HELPERS NOC WATERWORKS OPERATION SEWAGE DISPOSAL PLANT OPER FIREFIGHTERS & DRIVERS POLICE OFFICERS & DRIVERS MACHINERY DEALERS NOC ENGINEER/ARCHITECT CONSULTING SALESPERSONS CLERICAL OFFICE OR LIBRARIES HOSPITAL -VETERINARY BUILDINGS PARK -ALL EMPLOYEES & DRIVERS Total Annual Payroll Total Annual Manual Premium: Estimated Annual Payroll $1,512,264 $324,563 $1, 032, 078 $2,067,690 $0 $2, 337, 391 $1,392,376 $11,458,001 $15, 596, 091 $620,719 $2, 224, 016 $75,000 $13,219,944 $498,424 $609,903 $3,770,094 $56,738,554 Total Manual Premium: (a) Experience Modification Factor: (b) Other Modification Factor: Normal Premium: Page 1 of 2 Rate Per Estimated $100 of Annual Payroll Manual Premium 29 1.47 . 30 241 1.78 1.00 1 23 2 59 1.00 1.15 . 12 . 10 . 04 . 50 . 97 . 98 $4,386 $4,771 $3,096 $49,831 $0 $23,374 $17,126 $296,762 $155,961 $7,138 $2,669 $75 $5,288 $2,492 $5,916 $36,947 $615,832 $615,832 1.000000000 1.000000000 $615,832 Date Printed: 07/31/2023 VA Midwest Employers A BERKLEY COMPANY'S Endorsement Effective: 10/01/2023 Policy No.: EWC009753 Named insured: City of Pearland Endorsement Countersigned 1Iir a ized Reprelb-ntative MIDWEST EMPLOYERS CASUALTY COMPANY lI Secretary L Qat J• President ire 1 This endorsement forms part of the Policy to which attached, effective on the inception date of the Policy unless otherwise stated herein. All other terms and conditions of the Policy remain unchanged. CMB-11 (8-13) Page 2 of 2 Date Printed: 07/31/2023 ‚4!1'I Midwest Employers Casualty' Company A BERKLEY COMPANYl Endorsement Effective: 10/01/2023 Policy No.: EWC009753 Named Insured: City of Pearland Endorsement Policyholder Disclosure Notice of Terrorism Insurance Coverage Endorsement Coverage for acts of terrorism, as defined in the Terrorism Risk Insurance Act as amended, (the "Act"), is included in your Policy. As defined in Section 102(1) of the Act: The term "act of terrorism" means any act that is certified by the S ecretary of the Treasuryin consultation with the Secretary of Homeland Security, and the Attorney General of the U nited States to be an act of terrorism; to be a violent act or an act that is dangerous to human life, property, or infrastructure; to have resulted in damage within the United States, or outside the United States in the case of certain air carriers or vessels or the premises of a United States mission• and to have been committed by an individual or individuals as part of an effort to coerce the civilian population of the United States or to influence the policy or affect the conduct of the United States Government by coercion. Under your coverage, any losses resulting from certified acts of terrorism may be partially reimbursed by the United States Government under a formula established by the Act. However, your policy may contain other exclusions which might affect your coverage, such as an exclusion for nuclear events. Under the formula, the United States Government generally reimburses 80% beginning on January 1, 2020 of covered terrorism losses exceeding the statutorily established deductible paid by the insurance company providing the coverage. The Act contains a $100 billion cap that limits U.S Government reimbursement as well as insurers' liability for losses resulting from certified acts of terrorism when the amount of such losses exceeds $100 billion in any one calendar year. If the aggregate insured losses for all insurers exceed $100 billion, your coverage may be reduced. A. The portion of your annual premium that is attributable to coverage for acts of terrorism, as defined in the Act is: $4,628 and does not include any charges for the portion of losses covered by the United States government under the Act. N ame of Insurer: Midwest Employers Casualty Company Policy Number: EWC009753 Countersigned razed Representative MIDWEST EMPLOYERS CASUALTY COMPANY NA. ts.. .tiAs' Secretary L01,,(kk; President This endorsement forms part of the Policy to which attached, effective on the inception date of the Policy unless otherwise stated herein. All other terms and conditions of the Policy remain unchanged. CMB-199 (1-20) Page 1 of 1 Date Printed: 07/31/2023 lrs ,4!il MklwestCompanyp A BERKLEY COMPANY® Endorsement Effective: 10/01/2023 Policy No.: EWC009753 Named Insured: City of Pearland Endorsement Aircraft Exclusion Endorsement This Policy does not cover any Loss arising out of the ownership, maintenance, operation or use of any aircraft that is leased, owned (in whole or in part) or operated by you, your executive officer(s), director(s), Employee(s), parent company or subsidiary. This exclusion does not apply to regularly scheduled commercial airlines or chartered aircraft. Countersigned zed ' epr- '- ntative MIDWEST EMPLOYERS CASUALTY COMPANY �1 Secretary t• President This endorsement forms part of the Policy to which attached, effective on the inception date of the Policy unless otherwise stated herein. All other terms and conditions of the Policy remain unchanged. ISI-254-EXC (8-13) Date Printed: 07/31 /2023 Midwest ers ‚Sn1 Casualty Company� A BERKLEY COMYANYll Notice Effective: Policy No.: Named Insured: 10/01/2023 EWC009753 City of Pearland Notice Texas Important Notice This NOTICE applies only to coverage provided by this Policy because Texas is named in Item 3 of the Schedule Page. 1. To obtain information or to make a complaint: 2 You may contact your agent, Katrice Dlabaj at (713) 402-1445. 3. You may call Midwest Employers Casualty Company's toll -free telephone number for information or to make a complaint at: 1-800-793-3428 4. You may also write to Midwest Employers Casualty Company at: 14755 North Outer Forty Drive, Suite 300 Chesterfield, MO 63017 5. You may contact the Texas Department of Insurance to obtain information on companies, coverages, rights or complaints at: 1-800-252-3439 You may write the Texas Department of Insurance at: P.O Box 149104 Austin, TX 78714-9104 Fax # 512-475-1771 Web: http://www.tdi.state.tx.us E-mail: ConsumerProtectiontdi.state.tx.us PREMIUM OR CLAIM DISPUTES: Should you have a dispute concerning your premium or about a claim, you should contact McGriff Insurance Services LLC first. If the dispute is not resolved, you may contact the Texas Department of Insurance. 8. ATTACH THIS NOTICE TO YOUR POLICY: This notice is for information only and does not become a part or condition of the attached document. Countersigned ed R-present MIDWEST EMPLOYERS CASUALTY COMPANY \v Secretary IL. Sc-r President his notice forms part of the Policy to which attached, effective on the inception date of the Policy unless otherwise stated herein. All other terms and conditions of the Policy remain unchanged. CMB-TX (8-13) Date Printed: 07/31/2023 ‚4!!�, Midwest Employers Casualty Company w: R. Berkley Company Endorsement Effective: 10/01/2023 Policy No.: EWC009753 N amed Insured: City of Pearland Endorsement Texas Endorsement — Governmental Entities This endorsement applies only to coverage provided by this Policy because Texas is named in Item 3 of the Schedule Page. S ection C. Loss of Part One — Workers' Compensation Excess Indemnity is amended to read as follows: C. Loss under Part One of this Policy means the amount actually paid by you, after deduction of any Recovery, for regular benefits provided under the Texas Workers' Compensation Act in effect on the date the accident or exposure to disease occurs. Loss shall include, but is limited to, the following payments: 1. Payments made by you as required by the Texas Workers' Compensation Act; 2 Payments due and owing by you under the Texas Workers' Compensation Act; 3. Payments made on your behalf by any form of security as required by the Texas Workers' Compensation Act or Texas Workers' Compensation Commission rules; and 4. Reimbursable Claim Handling Expense as defined in Part Four Claims, Section L. of this Policy. Section N. Commutation by Mutual Agreement of Part Four — Claims of this Policy is amended as follows: N . Commutation by Mutual Agreement. With regard to any outstanding or unsettled Claims reported hereunder, either you or we may request that our liability for incurred Loss that exceeds the Specific Retention in Schedule Item 6 of this Policy be commuted. If there is mutual agreement between you and us that a commutation should be considered with regard to a Claim or Claims, then the following shall apply: 1. Within sixty (60) days after such mutual agreement to commute, you shall submit a statement of valuation for the outstanding Claim or Claims showing the elements considered reasonable to establish the commuted value of Loss. 2 The commuted value of Loss shall be calculated as the discounted present value of the Loss that exceeds the Specific Retention in Schedule Item 6, subject to the limits of liability shown in Schedule Items 7 and 8. 3. If the commuted value submitted by you is not acceptable to us, we may submit a counterproposal to you for commutation. If both you and we are unable to reach an agreement on the commuted value, then you and we shall either abandon the commutation effort or agree to mutually appoint an actuary or appraiser to investigate and determine the commuted value. If both you and we then agree to the commuted value arrived at by the actuary/appraiser, we shall pay the amount determined to be the commuted value of the Claim or Claims under this Policy. ISI-TX-A (10-16) Page 1 of 3 Date Printed: 07/31/2023 ,4!!�� Midwest Employers Casualty Company a W. R. Berkley Company Endorsement Effective: 10/01 /2023 Policy No.: EWC009753 Named Insured: City of Pearland Endorsement 4. If the commuted value determined by the appraiser above is not acceptable to both you and us, then you and we shall either abandon the commutation effort or agree to settle any difference using a panel of three actuaries, one to be chosen by you and one chosen by us, and a third chosen by the two so chosen. If the two actuaries fail to agree on the selection of a third actuary within sixty (60) days of their appointment, each of them shall name two, of whom the other shall decline one and the decision shall be made by drawing lots. All the actuaries shall be regularly engaged in the valuation of workers' compensation claims and shall be Fellows or Associates in the Casualty Actuarial Society. None of the actuaries shall have a financial interest in nor be a current or former employee of you or us, and all of the actuaries shall be disinterested in the outcome of the commutation. You and we shall each submit its case to its actuary within sixty (60) days of the appointment of the third actuary. The decision in writing of any two actuaries (from the panel of three), when filed hereto shall be final and binding on both you and us and we shall pay the amount so determined to be the commuted value of the Claim or Claims. The expense of the actuaries and of the commutation shall be equally divided between you and us. Said commutation shall take place in Texas, unless some other location is mutually agreed upon. 5. Payment by us of the commuted value of the Claim or Claims shall constitute full and final release of our liability for such Claim or Claims and your receipt of such payment shall constitute a full and final release of any and all obligations we have under this Policy. Section I. Cancellation of Part Six — Conditions of this Policy is amended to read as follows: I. Cancellation and Non -Renewal. 1. You may cancel or non -renew this Policy by notifying us and the authority shown below sixty (60) days prior to the cancellation or termination in the form and manner prescribed by the Commissioner. 2 We may cancel this Policy by mailing or delivering to you and the authority shown below, written notice of cancellation, stating the reason for cancellation, at least sixty (60) days before the effective date of the cancellation. Texas Department of Insurance / Division of Workers' Compensation Attn: Workers' Compensation Commissioner 7551 Metro Center Drive, Suite 100 Austin, TX 78744 3. We may cancel only for one or more of the following reasons: a. Fraud in obtaining coverage; b. Failure to pay premiums when due; c. An increase in hazard within your control which would produce an increase in rate; d. Loss of our reinsurance covering all or part of the risk covered by this Policy, or e. If we have been placed in supervision, conservatorship or receivership and the cancellation is approved or directed by the supervisor, conservator or receiver. 4. If notice is mailed, proof of mailing will be sufficient proof of notice. ISI-TX-A (10-16) Page 2 of 3 Date Printed: 07/31/2023 ,4!''I Midwest Employers Casualty Company it: R. Berkley Company Endorsement Effective: 10/01 /2023 Policy No.: EWC009753 Named Insured: City of Pearland Endorsement 5. If this Policy is cancelled, the Policy Period shall end at 12.01 A.M. on the cancellation date. This Policy does n ot apply to loss or liability which arises out of bodily injury by accident or bodily injury by disease that occurs after the effective date of such cancellation. 6. We may elect not to renew this Policy except, that under the provisions of the Texas Insurance Code, we may n ot refuse to renew this Policy solely because the policyholder is an elected official. 7. We may non -renew this Policy by mailing or delivering to you and the authority shown above, written notice of n on -renewal stating the reason for non -renewal at least sixty (60) days before the Policy expiration date. If n otice is mailed or delivered less than sixty (60) days before the expiration date, this Policy will remain in effect n ntil the 61 st day after the date on which the notice is mailed or delivered. 8. The transfer of a policyholder between admitted companies within the same insurance group is not considered a refusal to renew. 9. In the event of cancellation or non -renewal of this Policy, Final Premium shall be calculated as set forth in part Five — Premium, Section C. Final Premium of this Policy. Countersigned ized Re. - entativ MIDWEST EMPLOYERS CASUALTY COMPANY _tit • . I _tL�t 1I II Iv 1 41 Secretary President This endorsement forms •art of the Policy to which attached, effective on the inception date of the Policy unless otherwise stated herein. All other terms and conditions of the Policy remain unchanged. ISI-TX-A (10-16) Page 3 of 3 Date Printed: 07/31/2023 FA �t1 �Employers 1� A BERKLEY COMPANY& Endorsement Effective: 10/01 /2023 Policy No.: EWC009753 Named Insured: City of Pearland Endorsement Texas Employers Liability Endorsement This endorsement applies only to coverage provided by this Policy because Texas is named in Item 3 of the Schedule Page. Item 6 of Section E Exclusions From Loss of Part Two — Employers Liability Excess Indemnity is amended to read as follows: 6. Punitive or exemplary damages because of bodily injury to an Employee employed in violation of law if the violation of law caused or contributed to the bodily injury. Countersigned tit nzed ' epres MIDWEST EMPLOYERS CASUALTY COMPANY ti11. . _et (#k..- .,; �, �. 1 %• Secretary j President This endorsement forms part of the Policy to which attached, effective on the inception date of the Policy unless otherwise stated herein. All other terms and conditions of the Policy remain unchanged. CMB-TX-EL (8-13) Date Printed: 07/31/2023 ‚4! Midwest Employers S Casualty C A BERKLEY COMPANY® Individual Self -Insured Excess Workers' Compensation and Employers Liability Indemnity Policy In return for the payment of premium and subject to all of the terms of this Policy, we (Midwest Employers Casualty Company) agree to provide you (the Insured Named in Schedule Item 1) with the excess indemnity coverage stated on the Schedule and further agree with you as follows: GENERAL SECTION A. Self -Insurance. Our obligations under this Policy are subject to the condition that you are, at the inception of this Policy and shall remain until the end of the Policy Period, a duly qualified self -insurer in each State named in Schedule Item 3. If at any time during the Policy Period your status as a duly qualified self -insurer is suspended, cancelled, revoked, voluntarily surrendered, or terminated in any of the States named in Schedule Item 3, this Policy shall be immediately cancelled. The effective date of such cancellation shall be the date of said loss of your duly qualified self -insurer status. B. Insured. The Insured is named in Schedule Item 1. The words "you" or "your" as used in this Policy refer to the Insured. If the Insured is a partnership or joint venture, each partner or member of the joint venture is insured only in the capacity as employer of employees of the partnership or joint venture. C. Insurer. The Insurer is Midwest Employers Casualty Company. The words "we," "us," and "our" as used in this Policy refer to the Insurer. D. The Policy. This Policy includes the Schedule and any attached endorsements. It is an indemnity agreement between you and us. The only provisions relating to this indemnity agreement are stated in this Policy. The terms of this Policy may not be changed or waived except by endorsement issued by us to be a part of this Policy. Endorsements amending Schedule Items 1, 3, 4, 6, 7 or 8 apply with respect to bodily injury by accident and bodily injury by disease occurring on or after 12:01 A.M. on the effective date of the applicable endorsement(s). E. Policy Period means the period of time covered by this Policy as shown in Schedule Item 5. If this Policy is cancelled, the Policy Period shall end at 12:01 A.M. on the cancellation date. F. Workers' Compensation Law means the workers' compensation law and occupational disease law of a State, including any amendments to such law which are in effect during the Policy Period. The definition of "Workers' Compensation Law" does not include the provisions of any law that provide nonoccupational disability benefits. The definition of "Workers' Compensation Law" also does not include any federal workers' compensation law, federal occupational disease law or any other federal law. G. State means any state of the United States of America and the District of Columbia. H. Employee means an individual that you hire and regularly pay, who normally performs work for you under your direction and control in a State listed in Schedule Item 3. The definition of "Employee" does not include an independent contractor, subcontractor or an agent of a third party. If the Workers' Compensation Law in a state listed in Schedule Item 3 deems an individual to be your employee for liability purposes, then the individual shall be considered an Employee under Part One of this Policy. I. Service Company means the entity named in Schedule Item 14 that is retained by you to act on your behalf, as the third party administrator for Claims. PART ONE — WORKERS' COMPENSATION EXCESS INDEMNITY A. How This Part Applies. Part One of this Policy applies to Loss paid by you because of liability imposed upon you by the Workers' Compensation Law of any State named in Schedule Item 3, which arises out of or results from bodily injury by accident or bodily injury by disease sustained by your Employee. Part One of this Policy also applies to Loss paid by you because of liability imposed upon you by the Workers' Compensation Law of any other State which is not named in Schedule Item 4, which arises out of or results from bodily injury by accident or bodily injury by disease sustained by your Employee, provided that the work giving rise to the bodily injury was temporary and incidental to your work in any State named in Schedule Item 3. Bodily injury by accident must occur during the Policy Period. Bodily injury by disease must be caused or aggravated by the conditions of your employment. Bodily injury by disease includes cumulative trauma. The Employee's last day of last exposure to the conditions of your employment causing or EWC-ISI (2013) Page 1 of 10 aggravating such bodily injury by disease must occur during the Policy Period. Bodily injury by disease does not include disease that results directly from bodily injury by accident. Bodily injury includes resulting death. B. Specific Excess Indemnity Coverage. THIS SECTION B SHALL NOT APPLY, AND THE COVERAGE AFFORDED UNDER THIS SECTION B SHALL NOT BE PROVIDED TO YOU, IF THE WORDS "NOT APPLICABLE" ARE STATED IN SCHEDULE ITEMS 7(a) AND 8(a). 1. Your Specific Retention. You must retain Loss as shown in Schedule Item 6. Your Specific Retention applies to Part One Loss and to Part Two Loss combined IT IS IMPORTANT FOR YOU TO UNDERSTAND THAT YOUR SPECIFIC RETENTION FOR DISEASE APPLJFS SEPARATELY TO EACH EMPLOYEE. Naming more than one Insured in Schedule Item 1 does not increase your Specific Retention. 2. Our Specific Indemnity. We shall indemnify you under Part One of this Policy only for Loss paid by you in excess of your Specific Retention. 3. Our Specific Limit. The maximum Loss we shall indemnify you for under Part One of this Policy with respect to each accident is shown in Schedule Item 7(a). The maximum Loss we shall indemnify you for under Part One of this Policy with respect to each Employee for disease is shown in Schedule Item 8(a). Naming more than one Insured in Schedule Item 1 does not increase our Specific Limit under Part One of this Policy C. Loss under Part One of this Policy means the amount actually paid by you, after deduction of any Recovery, for regular benefits provided under the Workers' Compensation Law in effect on the date the accident or exposure to disease occurs. Loss shall include, but is limited to: 1. The amount paid by you in reasonable settlement of claims for regular benefits under the Workers' Compensation Law; 2. The amount paid by you in satisfaction of awards or judgments for regular benefits under the Workers' Compensation Law, and 3. Reimbursable Claim Handling Expense as defined in Part Four — Claims, Section L. of this Policy. D. Exclusions From Loss. Part One of this Policy does not cover: 1. Any Service Company fees, costs and expenses; 2. Fees, costs and expenses (including salaries, wages and other compensation paid to your Employees and independent contractors) of self -administration of Claims; 3. Loss insured by any other workers' compensation or employers liability insurance policy; 4. Loss payable under the Workers' Compensation Law of any State which is not named in Schedule Item 3, if you are insured for such loss by any other insurance; 5. Any loss arising out of operations for which you have rejected or elected to opt out of any Workers' Compensation Law; 6. Fines, penalties, sanctions, interest, costs, or attorney's fees assessed against you for any violation of any Workers' Compensation Law or other applicable statute, rule or regulation. (This exclusion does not apply to attorney's fees and costs you are ordered to pay to the prevailing party in a Claim in which you contested, in good faith, your liability to pay benefits under the Workers' Compensation Law); 7. Punitive or exemplary damages because of bodily injury sustained by any Employee; 8. Punitive, exemplary or compensatory damages because of your conduct, or the conduct of anyone acting for you: a In the investigation, trial or settlement of any claim under the Workers' Compensation Law; or b. In failing to pay or in delaying payment of benefits under the Workers' Compensation Law; 9. Any assessment, tax or surcharge made upon employers or self -insurers, whether imposed by statute, regulation or otherwise; or 10. Any payments in excess of the benefits regularly provided by any Workers' Compensation Law, including those required because: a. Of your serious, gross and willful misconduct; EWC-ISI (2013) Page 2 of 10 b. You knowingly employed an Employee in violation of applicable law; c. You failed to comply with an applicable health or safety law or regulation; d. You discharged coerced or otherwise discriminated against any Employee in violation of the Workers' Compensation Law; or e. You violated or failed to comply with any applicable Workers' Compensation Law. PART TWO - EMPLOYERS LIABILITY EXCESS INDEMNITY A. How This Part Applies. Part Two of this Policy applies to Loss paid by you for Damages imposed upon you by the laws of any State shown in Schedule Item 3, which arises out of or results from bodily injury by accident or bodily injury by disease sustained by your Employee. Part Two of this Policy also applies to Loss paid by you for Damages imposed upon you by the law of any other State which is not shown in Schedule Item 4, which arises out of or results from bodily injury by accident or bodily injury by disease sustained by your Employee, provided that the work giving rise to the bodily injury was temporary and incidental to your work in any State named in Schedule Item 3. Bodily injury must arise out of and in the course of the injured Employee's employment by you. Bodily injury by accident must occur during the Policy Period. Bodily injury by disease must be caused or aggravated by the conditions of your employment. Bodily injury by disease includes cumulative trauma. The Employee's last day of last exposure to the conditions of your employment causing or aggravating such bodily injury by disease must occur during the Policy Period. Bodily injury by disease does not include disease that results directly from bodily injury by accident. Bodily injury includes resulting death. B. Specific Excess Indemnity Coverage. THIS SECTION B SHALL NOT APPLY, AND THE COVERAGE AFFORDED UNDER THIS SECTION B SHALL NOT BE PROVIDED TO YOU, IF THE WORDS "NOT APPLICABLE" ARE STATED IN SCHEDULE ITEMS 7(b) AND 8(b). 1. Your Specific Retention. You must retain Loss as shown in Schedule Item 6. This Specific Retention applies to Part One Loss and to Part Two Loss combined IT IS IMPORTANT FOR YOU TO UNDERSTAND THAT YOUR SPECIFIC RETENTION FOR DISEASE APPLIES SEPARATELY TO EACH EMPLOYEE. Naming more than one Insured in Schedule Item 1 does not increase your Specific Retention. Our Specific Indemnity. We shall indemnify you under Part Two of this Policy only for Loss paid by you in excess of your Specific Retention. Our Specific Limit. The maximum Loss we shall indemnify you for under Part Two of this Policy with respect to each accident is shown in Schedule Item 7(b). The maximum Loss we shall indemnify you for under Part Two of this Policy with respect to each Employee for disease is shown in Schedule Item 8(b). Naming more than one Insured in Schedule Item 1 does not increase our Specific Limit under Part Two of this Policy C. Loss under Part Two of this Policy means the amount actually paid by you, after deduction of any Recovery, for Damages imposed upon you by law. Loss shall include, but is limited to: 1. The amount paid by you in reasonable settlement of claims or suits for Damages; 2. The amount paid by you in satisfaction of awards or judgments for Damages; and 3. Reimbursable Claim Handling Expense as defined in Part Four — Claims, Section L. of this Policy. D. Damages includes, and is limited to: 1. Damages for which you are liable to a third party by reason of a claim or suit against you by that third party to recover the damages claimed against such third party as a result of injury to your Employee; 2. Damages for care and loss of services; 3. Damages for consequential bodily injury to a spouse, child, parent, brother or sister of the injured Employee; provided that these damages are the direct consequence of bodily injury that arises out of and in the course of the injured Employee's employment by you; and 4. Damages because of bodily injury to your Employee that arise out of and in the course of employment, claimed against you in a capacity other than as employer 2. EWC-ISI (2013) Page 3 of 10 E. Exclusions From Loss. Part Two does not cover: 1. Any Service Company fees, costs and expenses; 2. Fees, costs and expenses (including salaries, wages and other compensation paid to your Employees and independent contractors) of self -administration of Claims; 3. Loss or liability assumed under a contract or agreement; 4. Loss or liability voluntarily assumed by you; 5. Loss payable under the laws of any State which is not named in Schedule Item 3, if you are protected from the loss by any other insurance; 6. Punitive or exemplary damages; 7. Bodily injury to an Employee while employed in violation of law with your actual knowledge or the actual knowledge of any of your executive officers or managers; 8. Any obligation imposed by any Workers' Compensation Law, unemployment compensation law, disability benefits law or any similar law; 9. Bodily injury intentionally caused or aggravated by you; 10. Bodily injury resulting from your conduct which is determined to be malicious, deliberate, willful with reckless disregard, substantially certain to cause injury, the equivalent to an intentional tort (regardless of how that term is defined or interpreted), or otherwise tortuous, such that you lose your immunity from civil liability under any Workers' Compensation Law; 11. Bodily injury to an Employee when you are deprived of common law defenses or are subject to a penalty because of your failure to secure your obligations under the applicable Workers' Compensation Law or otherwise fail to comply with that law; 12. Damages arising out of coercion, criticism, demotion evaluation, reassignment, discipline, defamation, harassment, humiliation, discrimination against or termination of any Employee, or any personnel practices, policies, acts or omissions; 13. Bodily injury occurring outside the United States of America. This exclusion does not apply to bodily injury to an Employee who is a citizen or resident of the State(s) listed in Schedule Item 3 who is temporarily working outside the United States of America for you; 14. Damages arising out of operations for which you have: (a) Violated or failed to comply with any Workers' Compensation Law; or (b) Rejected or elected to opt out of any Workers' Compensation Law; 15. Bodily injury to any Employee 'n work subject to the Longshore and Harbor Workers' Compensation Act (33 USC Sections 901-950) the Non -appropriated Fund Instrumentalities Act (5 USC Sections 8171-8173), the Outer Continental Shelf Lands Act (43 USC Sections 1331-1356a) the Defense Base Act (42 USC Sections 1651-1654), the Federal Mine Health and Safety Act of 1969 (30 USC Sections 801-945), the Federal Employers' Liability Act (45 USC Sections 51-60), the Migrant and Seasonal Agricultural Worker Protection Act (29 USC Sections 1801- 1872), the Merchant Marine Act of 1920 also known as the Jones Act (46 USC Section 688) and any other federal workers' compensation law or other federal occupational disease law, or any amendments to these laws, obligating an employer to pay damages to an employee due to bodily injury arising out of or in the course of employment; 16. Bodily injury to a master or member of the crew of any vessel; or 17. Fines or penalties imposed for violation of any federal or State law. PART THREE - AGGREGATE EXCESS INDEMNITY THIS PART THREE SHALL NOT APPLY, AND THE COVERAGE AFFORDED UNDER THIS PART THREE SHALL NOT BE PROVIDED TO YOU, IF THE WORDS "NOT APPLICABLE" ARE STATED IN SCHEDULE ITEMS 9(a), 9(b), 9(c), 9(d) AND 10. A. Your Aggregate Retention The amount of Loss you must retain as a result of all accidents and disease exposures occurring during the Policy Period shall be computed as shown in Schedule Item 9(a). This Aggregate Retention applies to Part One Loss and to Part Two Loss combined. In calculating your Aggregate Retention, Loss pertaining to each accident or disease shall be limited to the respective amount shown in Schedule Item 9(d). Unless we cancel this Policy, EWC-ISI (2013) Page 4 of 10 your Aggregate Retention shall not be less than the Minimum Retention shown in Schedule Item 9(c). If we cancel this Policy your Aggregate Retention shall not be less than the pro rata portion of the Minimum Retention shown in Schedule Item 9(c) based upon the number of days from the effective date of this Policy to (and including) the date of cancellation Naming more than one Insured in Schedule Item 1 does not increase your Aggregate Retention. Normal Premium is defined in Part Five — Premium, Section C. Final Premium of this Policy. B. Our Aggregate Indemnity. We shall indemnify you under Part Three of this Policy for Loss paid by you in excess of your Aggregate Retention as a result of all accidents and disease exposures occurring during the Policy Period. In calculating our indemnity, Loss pertaining to each accident or disease shall be limited to the respective amount shown in Schedule Item 9(d). C. Our Aggregate Limit. The maximum Loss we shall indemnify you for under Part Three of this Policy as a result of all accidents and disease exposures occurring during the Policy Period is shown in Schedule Item 10. This limit applies to Part One Loss and to Part Two Loss combined. Naming more than one Insured in Schedule Item 1 does not increase our Aggregate Limit under Part Three of this Policy. PART FOUR - CLAIMS A. Claim means any administrative filing, cause of action, demand, suit, legal action, proceeding or liability asserted against or imposed upon you for which you have paid Loss or may be liable to pay Loss under Part One, Part Two or Part Three of this Policy. B. Claims Information means any information collected, maintained, analyzed or generated by you, your Service Company, claims consultant, attorney, pharmacy benefits manager, bill reviewer and any other outside vendors or entities retained on your behalf, that relates to any Claim injury or Loss occurring during the Policy Period C. D. E. F. G. Electronic Data Interchange means the secure transmission of Claims Information from you to us by electronic means, in a specific form and manner that is approved by us. First Notice of Loss means a written form acceptable to us that provides the complete details of the injury, disease, death or Claim. Providing a loss run, or Claims Information as required by Section H. Your Duty to Send Claims Information, does not constitute a First Notice of Loss. Full and Final Settlement means a settlement that extinguishes and releases you from liability to make any future monetary payments on a Claim by your payment of a sum certain amount, which may include a lump sum, annuity premium, seed money, attorney fees, costs lien waiver and/or other consideration. Your Claims Handling Duties. It is your duty and responsibility to investigate, handle, settle, defend and appeal all Claims. Your Specific Claims Reporting Duties. To the extent that this Policy provides Specific Excess Indemnity coverage as stated in the Schedule, it is your duty and responsibility to provide us with a First Notice of Loss for each injury or Claim as specified by this Section. 1. Catastrophic and Serious Injury Claims - Requiring First Notice of Loss Within Five (5) Days. You must send us a First Notice of Loss within five (5) days after the occurrence of any accident or disease exposure involving an Employee who sustained any of the following injuries, even if you are contesting your liability: a. Fatality; b. Brain injury, c. Spinal cord injury; d. Paralysis of any part of the body; e. Serious burn injury (burns over 25% or more of the body); f. Amputation of a major extremity; g. Crushing or massive internal injury; or h. Partial or total loss of vision in one or both eyes. 2. Employer Liability Claims - First Notice of Loss Within Thirty (30) Days. You must send us a First Notice of Loss within thirty (30) days of your notice of a Claim that may fall under Part Two — Employers Liability of this Policy. 3. Other Claims Requiring Reporting by First Notice of Loss Within Thirty (30) Days. You must send us a First Notice of Loss within thirty (30) days after the occurrence of any of the following events on an individual Claim: a. The total paid Loss exceeds $250,000 or the total incurred amount of Loss (paid and reserves) exceeds 50% of your Specific Retention, whichever event occurs first; EWC-ISI (2013) Page 5 of 10 b. An injured Employee misses fifty-two (52) weeks of work as a result of the injury, even if the Claim is being contested by you; c. An injured Employee has petitioned to be deemed, is accepted as, awarded, or found to be catastrophically or permanently and totally disabled under the Workers' Compensation Law; d. An accident or disease exposure involving injury to two or more Employees; or e. An Employee is diagnosed with cancer, heart disease, lung disease, infectious disease or other disease that is presumed to be, or found to be, compensable under the Workers' Compensation Law. 4. Consequence of Your Failure to Send Us A Timely First Notice of Loss. If you do not send us a First Notice of Loss of an injury or Claim within the time specified in this Section and we are prejudiced as a result we may deny you indemnification under this Policy for Loss that arises out of or results from that injury or Claim. H. Your Duty to Send Claims Information. You agree to provide us with any Claims Information that we may request, which may include, but is not limited to: 1. Providing detailed Claims Information on a specific individual Claim; 2. Sending us specified Claims Information on a periodic and recurring basis for all Claims within the Policy Period; 3. Transmitting Claims Information through Electronic Data Interchange; and 4. Granting us on-line read-only access to your Service Company's or, if you are self-administered, your computerized Claims system, so that we may view Claims Information. You authorize the release and disclosure of requested Claims Information directly to us from your Service Company or any other third party that possesses such Claims Information. Claims Participation by Us. At our own election and expense, we have the right and shall be given the opportunity to participate with you in the investigation, handling, settlement, defense or appeal of any Claim which might involve a Loss to us, and you agree to fully cooperate with us if we so elect to participate. We have no duty to investigate, handle, settle defend or appeal any Claim. J. Good Faith Claims Handling and Settlements It is your duty and responsibility to use diligence, prudence and good faith in the investigation, handling, defense, settlement and appeal of all Claims. Your duty and responsibility include but are not limited to, the following: 1. Investigation and Defense. You shall diligently and competently investigate, handle and defend all Claims. You shall not engage in frivolous litigation or conduct that is unreasonable, sanctionable or in bad faith. You shall comply with all applicable Workers' Compensation Laws and court rules that govern the investigation, handling and defense of Claims. 2. Pursuit of Settlement. You shall pursue settlement of each Claim when it is reasonable to do so. You shall engage in settlement discussions and participate in good faith in settlement conferences and voluntary mediation when available. 3. Settlement Within Your Retention. If you are presented with a reasonable opportunity to reach a Full and Final Settlement of a Claim within your Retention, you shall settle it. If a Claim is filed in a State that will not allow a Full and Final Settlement, and you are presented with a reasonable opportunity to reach a partial settlement of the Claim within your Retention, you shall settle it 4. Settlement Involving Loss to Us. You shall not agree to any voluntary settlement or make a voluntary lump sum settlement payment involving Loss to us under this Policy without our written consent. If we give you our written consent to a reasonable settlement which involves Loss to us, you shall not refuse to accept the settlement. You shall do what is necessary to consummate such settlement, including executing all necessary settlement documents and remitting the settlement payment in a timely fashion. K. Recovery. 1. Recovery means any amount recovered which may mitigate Loss covered by this Policy, including, but not limited to amounts paid: a. On behalf of any third party, person or entity that may be liable for any injury Loss or Claim covered by this Policy b. By the applicable State second injury fund, special disability fund or similar fund or trust existing under the Workers' Compensation Law or other State law, which entitle you to reimbursement for past payments or benefits made by you and/or reduce your liability to make future payments or benefits; c In satisfaction of your statutory lien rights; or d. On account of overpayments, offsets deductions or credits against your obligations to make payments or provide benefits under the Workers' Compensation Law or other State law. EWC-ISI (2013) Page 6 of 10 2. Your Duty to Pursue Recovery. It is your duty and responsibility to diligently, prudently and in good faith, investigate and prosecute your rights to Recovery. 3. Subrogation of Your Rights. To the extent that we have paid Loss or we believe that we may incur Loss under this Policy, we shall be subrogated to your rights to Recovery You shall do everything necessary to protect those rights for us and to help us enforce them. At our election, we may take over your rights to Recovery and you agree to fully assist us, including assigning or transferring your rights to us or allowing us to pursue the prosecution in your name. 4. Allocation of Amounts Recovered. Any Recovery received by you or us shall first be used to pay reasonable expenses of collection and then to reimburse us for any amount we have paid to you under this Policy. The balance of Recovery, if any, shall be payable to you and shall reduce the Loss paid by you under your Specific Retention for this Policy. 5. Non -Waiver of Your Recovery Rights. You agree not to waive, settle or compromise your right to Recovery without our written consent if we have paid Loss or may incur Loss under this Policy. 6. Good Faith Settlement of Recovery Actions. You agree not to refuse to settle any right to Recovery which, in the exercise of good faith and sound judgment, should be settled. L. Reimbursable Claim Handling Expense. Reimbursable Claim Handling Expense means and is limited to the following expenses, but only if they are reasonable and directly allocated to a particular Claim covered by this Policy: 1. Fees for attorneys or their authorized representatives that are directly involved in litigation of the Claim; 2. Litigation expenses including court costs deposition costs, witness fees, subpoena and summons service fees; 3. Alternative dispute expenses such as mediation and arbitration fees and expenses; 4. Appeal bonds and appeal fees; 5. Surveillance and investigation fees; 6. Expert witness fees; 7. Independent medical and forensic examination fees; 8 Independent nurse case management and rehabilitation consultant fees; 9. Fees for medical treatment utilization reviews if performed by a nurse or doctor; 10. Medical bill review, auditing or re -pricing costs; 11. Medical preferred provider network/organization (PPN/PPO) fees; 12. Medical fee review panel expenses; and 13. Expenses which are required by the applicable Workers' Compensation Law If any other expense that is not listed above and is not otherwise excluded from Loss is nevertheless directly related to a specific covered Claim, it shall be considered a Reimbursable Claim Handling Expense only if we give you written consent prior to the expense being incurred. M. Proof of Loss. You must provide us with a Proof of Loss acceptable to us to receive prompt indemnification under this Policy for the particular excess indemnity coverage provided to you as stated on the Schedule A Proof of Loss shall contain the following information: 1. Specific Proof of Loss. You must provide us with a payment register listing all payments made on the Claim and any supporting documentation that we request, in a form acceptable to us. 2. Aggregate Proof of Loss You must provide us with a detailed loss run listing each Claim in the Policy Period, the date of Loss of each Claim, the amount paid, any remaining reserves, and any supporting documentation that we request, in a form acceptable to us. N. Commutation by Mutual Agreement. With regard to any outstanding or unsettled Claims reported hereunder, either party may request that our liability for incurred Loss that exceeds the Specific Retention in Schedule Item 6 of this Policy be commuted. If there is mutual agreement between you and us that a commutation should be considered with regard to a Claim or Claims, then the following shall apply: 1. Within sixty (60) days after such mutual agreement to commute, you shall submit a statement of valuation for the outstanding Claim or Claims showing the elements considered reasonable to establish the commuted value of Loss. EWC-ISI (2013) Page 7 of 10 2. The commuted value of Loss shall be calculated as the discounted present value of the Loss that exceeds the Specific Retention in Schedule Item 6 subject to the limits of liability shown in Schedule Items 7 and 8. 3. If the commuted value submitted by you is not acceptable to us we may submit a counterproposal to you for commutation. If both parties are unable to reach an agreement on the commuted value, then the parties shall either abandon the commutation effort or agree to mutually appoint an actuary or appraiser to investigate and determine the commuted value. If both parties then agree to the commuted value arrived at by the actuary/appraiser, we shall pay the amount determined to be the commuted value of the Claim or Claims under this Policy. 4. If the commuted value determined by the appraiser above is not acceptable to both parties, they shall either abandon the commutation effort or agree to settle any difference using a panel of three actuaries, one to be chosen by each party, and a third chosen by the two so chosen. If the two actuaries fail to agree on the selection of a third actuary within sixty (60) days of their appointment, each of them shall name two of whom the other shall decline one and the decision shall be made by drawing lots. All the actuaries shall be regularly engaged in the valuation of workers' compensation claims and shall be Fellows or Associates in the Casualty Actuarial Society. None of the actuaries shall have a financial interest in nor be a current or former employee of the parties and all of the actuaries shall be disinterested in the outcome of the commutation Each party shall submit its case to its actuary within sixty (60) days of the appointment of the third actuary. The decision in writing of any two actuaries (from the panel of three), when filed with the parties hereto shall be final and binding on both parties and we shall pay the amount so determined to be the commuted value of the Claim or Claims. The expense of the actuaries and of the commutation shall be equally divided between both parties. Said commutation shall take place in St Louis County, Missouri, unless some other location is mutually agreed upon by the parties. 5. Payment by us of the commuted value of the Claim or Claims shall constitute full and final release of our liability for such Claim or Claims and your receipt of such payment shall constitute a full and final release of any and all obligations we have under this Policy. O. Claims Audit and Computer Access. You shall let us or our representatives examine and audit Claims files upon our request. You shall also let us or our representatives examine and audit your Service Company's or if you are self- administered, your Claims practices, procedures, and records relating to Claims handling, disability and medical management, reserving, Claims reporting compliance and file conclusion. You agree to grant us access to your Service Company's or, if you are self-administered, your computerized Claims system, including on-line read-only access. P. Inspection. You shall let us or our representatives inspect your premises, workplaces and equipment upon our request. Any such inspection is not a safety inspection. If we communicate any findings or issues to you after an inspection, it shall be for general purposes only. By performing an inspection we are not undertaking any duty to assure that your premises workplaces and equipment are safe and in compliance with applicable laws or industry standards. PART FIVE - PREMIUM A. Deposit and Adjustment Premiums. At the beginning of the Policy Period, you must pay us the Deposit Premium and any flat charges shown in the Schedule. At the end of the Policy Period: 1. You shall owe us the amount by which the Final Premium is greater than the Deposit Premium; or 2. We shall owe you the amount by which the Deposit Premium is greater than the Final Premium. B. Payroll Report. Within forty-five (45) days after the end of the Policy Period, you must send us a report showing the amount of Payroll earned by your Employees during the Policy Period. The report must show Payroll separately for each classification identified in Schedule Item 11. C. Final Premium. The Final Premium due to us for the Policy Period shall be computed as shown in Schedule Item 12(a). Normal Premium means the sum of the products of your audited Payroll within each classification shown in Schedule Item 11 for each State named in Schedule Item 3 multiplied by the rate shown in Schedule Item 11 for the respective classification, the product of which shall be further multiplied by the Experience Modification Factor shown in Schedule Item 11(a) and/or any Other Modification Factor shown in Schedule Item 11(b). Unless this Policy is cancelled, Final Premium shall be at least the Minimum Premium shown in the Schedule. When determining Final Premium, any flat charges shown in the Schedule are not subject to additional computations or modification factors. EWC-ISI (2013) Page 8 of 10 If we cancel this Policy, Final Premium shall be calculated pro rata based on the time this Policy was in force. Final Premium shall not be less than the pro rata share of the Minimum Premium shown in the Schedule. If you cancel this Policy, Final Premium shall be more than pro rata; it shall be based on the time this Policy was in force, and increased by the customary short rate table and procedure. Final Premium shall not be less than the Minimum Premium shown in the Schedule. If this Policy is automatically cancelled because of the loss of your duly qualified self -insurer status as stated in Section A. Self -Insurance of the General Section of this Policy, Final Premium shall be more than pro rata; it shall be based on the time this Policy was in force and increased by the customary short rate table and procedure. Final Premium shall not be less than the Minimum Premium shown in the Schedule. The Final Premium due to us shall not be reduced by the existence of any other insurance, reinsurance, indemnity agreement or other reimbursement agreement protecting you against Loss covered by this Policy. D. Payroll means the gross pay of your Employees for the Policy Period plus other amounts and items earned by your Employees as part of their pay for the Policy Period. Payroll also includes: 1. Gross pay plus other amounts and items earned by your officers if covered under this Policy; 2. The contract price for materials and services performed by any individual deemed to be your Employee for liability purposes under the Workers' Compensation Law if you do not have Payroll records for this individual; and 3. Assigned Payroll attributed to volunteers for whom you are legally obligated to provide benefits under the Workers' Compensation Law. Assigned Payroll means: a. For volunteers other than volunteer firefighters and volunteer police officers, the federal minimum hourly wage as of the effective date of this Policy multiplied by the hours worked by the volunteers, unless the work performed by the volunteers is similar to work performed by a paid Employee who is receiving more than the federal minimum hourly wage, in which event the wage reported for the volunteer worker shall be the same as the wage reported for the paid Employee; and b. For volunteer firefighters or volunteer police officers, the greater of $12,500 per year or the same wage as reported for a paid Employee performing similar work shall be included in Payroll for each such volunteer firefighter or volunteer police officer. Duties performed by volunteers shall be assigned to the classification code which the duties would be assigned to if performed by regular Employees. No amount is included in Assigned Payroll for any volunteer worker who is not covered under the Workers' Compensation Law because Part One of this Policy does not apply with respect to that worker. E. Records. You shall keep records of information needed to compute premium. You shall provide us with copies of those records when we ask for them F. Audit. Upon our request, you shall let us or our representatives examine and audit all your Payroll records. Payroll records include, but are not limited to, ledgers, journals, registers vouchers, contracts, tax reports, Payroll and disbursement records, and programs for storing and retrieving data. The audits may be conducted during your regular business hours. PART SIX - CONDITIONS A. Agreement Upon Terms. Your acceptance of this Policy means that you agree with us upon the terms of this Policy, the Schedule and any attached endorsements. You warrant that the statements you made in the application, and in any supplemental materials or information you submitted to us, are true and accurate, and understand that we have issued this Pol cy in reliance upon those representations. You agree that your full compliance with all of the tei ins and conditions of this Policy is a condition precedent to our indemnity obligations under this Policy. You shall have no right of action against us unless you have complied with all of the terms and conditions of this Policy. B. Sole Representative. The Insured first named in Schedule Item 1 shall act on behalf of all Insureds to accept any agreed upon change to this Policy, to accept Loss payments, to receive return premium and to give or receive notice of cancellation. C. Bankruptcy or Insolvency. Your bankruptcy or insolvency shall not relieve us from the payment of any Loss covered by this Policy. After the Retention shown on the Schedule has been paid payments shall be made by us as if you had not become bankrupt or insolvent but not in excess of the Specific Limit or the Aggregate Limit shown on the Schedule. Payment shall be made to the Trustee in Bankruptcy or as directed by an appropriate court. We shall never make payments below the Retention shown on the Schedule, nor shall our indemnity obligations under this Policy ever be increased or broaden because of your bankruptcy or insolvency EWC-ISI (2013) Page 9 of 10 D. Other Insurance. If any other insurance, reinsurance, indemnity agreement or other reimbursement agreement exists protecting you against Loss covered by this Policy, the indemnity coverage afforded under this Policy shall apply in excess of such other insurance, reinsurance, indemnity agreement or other reimbursement agreement. E. Offset. We have the right to offset any balance or amount you owe us, whether such balance is on account of premium due, Recovery due, expenses, or other amount owed, against any indemnification for Loss, premium refund or other amount we owe you under this Policy or under any other policy or agreement entered into between you and us. F. Transfer or Assignment of Your Rights and Duties. Your rights or duties under this Policy shall not be transferred without our express written consent. G. No Third -Party Rights. This Policy is solely between you and us. Nothing in this Policy shall in any manner create any obligations or establish any rights of action against us in favor of any third parties, or persons not a party to this Policy, including but not limited to any Employees or claimants. II. Service and Administration. This Policy contemplates the concurrent and continued existence of a separate service agreement between you and the Service Company named in Schedule Item 14 relating to the administration of Claims. You agree to provide us a copy of such service agreement at our request. You further agree to immediately notify us in the event that the service agreement is amended, cancelled or terminated. We must agree to any change in the Service Company. If Schedule Item 14 states "Approved for Self -Administration," then we have agreed to your self -administration of Claims covered by this Policy. If you have been approved for self -administration, you must obtain our consent prior to moving your administration of Claims to a Service Company. The obligations under this Section shall survive the expiration of the Policy Period and any subsequent renewal of this Policy. I. Cancellation. You may cancel this Policy by giving us at least sixty (60) days advance written notice stating the cancellation date. We may cancel thisPolicy by giving you at least sixty (60) days advance writtennotice stating the cancellation date. Our delivery of notice to your address shown in Schedule Item 2 shall be sufficient proof that we cancelled this Policy. If this Policy is cancelled, the Policy Period shall end at 12:01 A.M. on the cancellation date. This Policy does not apply to loss or liability which arises out of bodily injury by accident or bodily injury by disease that occurs after the effective date of such cancellation. If you fail to pay premium due to us by the due date, we have the right to cancel with ten (10) days written notice to you. In the event of cancellation of this Policy, Final Premium shall be calculated as set forth in Part Five — Premium, Section C. Final Premium of this Policy. J. Non -Conformance. If the terms of this Policy are in conflict with any law applicable to this Policy, this statement amends this Policy to conform to such law. • We have executed this Policy by printing below the facsimile signatures of our President and Secretary and by the actual signature of our authorized representative on the Schedule if required by law. MIDWEST EMPLOYERS CASUALTY COMPANY Signature Secretary Signature President EWC-ISI (2013) Page 10 of 10 kA V Midwest Privacy Notice Employers Casualty a Berkley Company Midwest Employers Casualty Company (the "Company"), a member company of the W. R. Berkley Corporation ("Berkley") group of companies and each other member of the Berkley group of companies ("Affiliates") understands our customers' concern about privacy of their information collected by the Company. Our Company is dedicated to protecting the confidentiality and security of nonpublic personal information we collect about our customers in accordance with applicable laws and regulations. This notice refers to the Company by using the terms "us," "we," or "our.' This notice describes our privacy policy and describes how we treat the nonpublic personal information about our customers that we receive from them ("Information"). Why We Collect and How We Use Information We collect and use Information for business purposes with respect to our insurance products and services and other business relations involving our customers We gather this Information to evaluate your request for insurance, to evaluate your insurance claims, to administer, maintain or review your insurance policy, and to process your insurance transactions. We also accumulate certain information about you as may be required or permitted by law. Your insurance agent or broker also collects this Information and may use it to help with your overall insurance program or to market additional products and services to you. We may also use Information to offer you other products or services that we or our Affiliates provide. How We Collect Information Most Information collected by us is provided by you or your insurance agent or broker to us. We obtain Information from (i) applications or other forms submitted by you, your insurance agent or broker or your authorized representatives to us and our Affiliates, and (ii) your transactions with us or our Affiliates. We may also obtain Information from other sources such as (i) consumer reporting agencies, (ii) other institutions or information services providers (third party administrators), (iii) employers, (iv) other insurers, or (v) your family members. Information We Disclose We disclose any Information which we believe is necessary to conduct our business as permitted by applicable law or where required by applicable law. This disclosure may include (i) Information we receive from you on applications or other forms provided to us and our Affiliates, such as names, addresses, social security numbers, assets, employer information, salaries, etc. (ii) Information about your transactions with us and our Affiliates, such as policy coverages, premiums, payment history, etc., and (iii) Information we receive from a consumer reporting agency, such as credit worthiness and credit history. To Whom We Disclose Information We may, as permitted or required by applicable law, disclose your Information to nonaffiliated third parties, such as (i) your insurance agent or broker, (ii) independent claims adjusters (iii) insurance support organizations, (iv) processing companies , (v) actuarial organizations, (vi) law firms, (vii) other insurance companies involved in an insurance transaction with you, (viii) law enforcement, regulatory, or governmental agencies, (ix) courts or parties therein pursuant to a subpoena or court order, (x) businesses with whom we have a marketing agreement, or (xi) our Affiliates. We may share Information with our Affiliates so that they may offer you products and services from the Berkley group of companies or to analyze our book of business and to consolidate necessary information. We do not disclose Information to other companies or organizations not affiliated with us for the purpose of using Information to sell their products or services to you. For example, we do not sell your name to unaffiliated mail order or direct marketing companies. How We Protect Information We require our employees to protect the confidentiality of Information as required by applicable law. Access to Information by our employees is limited to administering, offering, servicing, processing or maintaining of our products and services. We also maintain physical, electronic and procedural safeguards designed to protect Information When we share or provide Information to other persons or organizations, we contractually obligate them, if required by law, to treat Information as confidential and conform to our privacy policy and applicable laws and regulations. Correction and Access to Information Upon our receipt of your written request to us at Midwest Employers Casualty Company, 14755 North Outer Forty Drive, Suite 300, Chesterfield, MO 63017 (Attn: Stephanie Wilmotte, Assistant Secretary), we will, generally, make available Information for your review. If you believe the Information we have about you is incorrect or inaccurate, you may request that we make any necessary corrections, additions or deletions. If we agree with your belief, we will correct our records if required by applicable law. If we do not agree, you may submit to us a short statement of dispute, which we will include in any future disclosure by us of such Information if required by applicable law. Requirements for Privacy Notice This privacy notice is being provided due to recently enacted federal and state laws and regulations establishing new privacy standards and requires us to provide this privacy policy. For additional information regarding our privacy policy please write to us at Midwest Employers Casualty Company, 14755 North Outer Forty Drive, Suite 300, Chesterfield, MO 63017 (Attn: Stephanie Wilmotte, Assistant Secretary). Adopted: July 1, 2001