HOLD HARMLESS AGREEMENT RE REFUND & POLICYHOLDER LIABILITY
j
I
HOLD HARMLESS AGREEMENT
'991
THIS AGREEMENT is made and entered into effective this ~day of September, 1-996, by and between
Anthem Life Insurance Company ("Company") and City of Clearwater ("Policyholder").
WHEREAS, the A&H coverage under Group Policy No. 5437 ("Policy"), issued by the Company to the
Policyholder, was terminated effective December 31, 1990; and
WHEREAS, the Company and the Policyholder desire to enter into an agreement (this Agreement)
providing for the transfer of all unused reserves as a premium refund to the Policyholder ("Refund") and
setting forth the rights and obligations of each with respect to such transfer;
NOW, THEREFORE, for and in consideration of the payment of such Refund and of the covenants
hereinafter recited, the Company and the Policyholder agree as follows:
I. Refund
1.1 Amount. The amount of the Refund is $444,449, representing the balance of all unused
reserves held by the Company for the payment of benefits with respect to claims arising
under the Policy after August 31, 1996.
1.2 P~ment. The Refund will be paid by the Company to the Policyholder on October 1, 1996,
subject to the execution of this Agreement by the Policyholder.
II. Policyholder Liability. The Policyholder hereby
(a) dischar~es the Company from any and all duties to adjust and pay benefits under the Policy
for which claim is made on or after the effective date of this Agreement; and
(b) assumes liability for any and all benefits payable under the Policy for which claim is made
on or after the effective date of this Agreement and for any and all extra-contractual
damages, including, without limitation, punitive damages, costs of suit and attorney fees
with respect to causes of action arising out of or in any way related to such claims; and
(c) a~ees to defend and to hold harmless the Company against any and all costs and expenses
with respect to any claims, demands, actions or causes of action arising out of or in any way
related to benefits under the Policy for Which claim is made on or after the effective date of
this Agreement.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby have executed this
Agreement in duplicate original.
City of Clearwater
ANTHEM LIFE INSURANCE COMPANY
2~~~
Date: _ly-t;;:;k. 3/ /9'i{,
By: ~h?~ -
E abeth . Deptula
Title: ty Manager
Date: I /~J'i7
ATTEST: Cynthia E. Goudeau, City Clerk
O,~~ Ji~ .Jl."
,,' 0'
. Anthem Health
)
I
The Anlhem Hnhh Companie.
4().lO Vincenn.. Circle
Indianapoli.. Indiana 46268-3027
(317) 228-7000
August 31,1996
Chief Financial Officer
City of Clearwater
112 South Osceola
Cleanvater, Florida 33516
Dear Sir,
On May 1, 1986, City of Cleanvater purchased A&H coverage with Gulf Life Insurance Company.
Through a series of purchases and mergers, the company is now known as Anthem Life Insurance
Company.
City of Clearwater was funded as a retrospectively rated account, and it has ultimately produced a balance
of $ 444,449. Enclosed is a final accounting through September 1, 1996 offunds which Anthem is
holding on behalf of City of Cleanvater .
Also enclosed is a hold harmless agreement which we ask that you sign and return. A hold harmless
agreement states that Anthem would not be liable for any future claims that may be submitted to us with
respect to this group. In return, Anthem will send a check in the amount stated on the experience
statement. Anthem realizes that the case is closed, but to finalize our records, a signed hold harmless
agreement is necessary.
When returning the signed hold harmless, please provide the name of the contact person at City of
Clearwater to whom you would like the check remitted. If you have any questions, please feel free to
contact me at (317) 228-7228.
Sincerely,
~~ /1 --:t-i.AAr>-?#--_ / ,4J'/i
Lorrie A. Freeman, A.S.A.
Associate Actuary
Anthem Health
"
.
I
The Anthem Health Companie.
4040 Vincenne. Cirele
Inmanapoli.. Indiana 46268-3027
(317) 228-7000
November 6, 1996
Tom Riclwmc
Wittner & Company
5999 Central Avcnue, Suite 400
St Petersburg, Florida 33710
Dear Mr. Ricbarme,
Per our telephone conversation, I am putting in writing the agreement we reached regarding the City of
Clearwater. The City of Clearwater originally purchased A&H coverage with Gulf Life Insurance
Company. Through a series of purchases and mergers, the company is now kno\\-n as Anthem Life
Insurance Company. Anthem searched its files and found three large master files/underwriting files, but
nowhere in those files could an original contract be found. It is our belief that the original contract was
kept with the agent It is also my understanding that the City of Oearwater was unable to find an original
contract in their files.
According to our records, the City of Clearwater was funded as a retrospectively rated account, and it has
ultimately produced a balance of $ 444,449. Given the length of time since termination, Anthem is
willing to credit interest according to standard company practice, which is to credit interest starting 15
months past termination using an interest rate equal to the 13 week T~ill minus .9. I have outlined the
interest rates used in determining the interest calculation for the City of Clearwater. The termination date
for the City of Clearwater is 12131/90.
Time Period
Interest Rate
T'lIDe Period
Interest Rate
4/1/92 - 4/1/93
4/1/93 - 4/1/94
4/1/94 - 4/1/95
3.18%
2.06%
2.81 %
411195 - 4/1/96
4/1/96 - 11/1/96
4.86%
4.17%
The total amount of interest to be paid through 11/1/96 to the City of Clearwater is $ 72,391. Interest will
continue to be credited through the date of payment
It is my understanding that this completes all information requested by the City of Clearwater. Upon my
receipt of the signed hold harmless, I will issue a check request for the balance plus interest to date of
disbursement Please provide the name of the person to whom you would like the check sent
If you have any questions or still need additional information, please feel free to contact me at
(317) 228-7228 or by Fax at (317) 228-7005.
Sincerely,
y~ a ':f~v-.-, ASA
Lorrie A. Freeman, A.S.A.
Associate ActuaIy
~R COMPANhS
November 13, 1996
B) ~ @ ~ ~ W ~ ~~
'.J~ lib
Mr. Leo Schrader
Risk Manager
City of Clearwater
100 S. Myrtle Ave.
Clearwater, FL 34618
NOV 1 3 1996
RISK MANAGEMENT
RE: AnthemlGulfLife Policy # 5437
Dear Leo:
The enclosed information from Ms. Freeman at Anthem is fairly self-explanatory. As noted, we
were successful in generating an additional $72,391 in interest to the City. Thus, the entire refund
will be $516,840.
It is my opinion and recommendation that the City sign the hold harmless agreement and close out
the account, and deposit the $516,840 into the premium stabilization account. The exposure to
the City of any further claims is believed to be minimal.
Please give me a call if you have any questions.
Sincerely,
~. (2{ C1A,JL",. ~ SIGNeD IN MY ABSENCE TO AVOID DE~Y
Tom Richarme, CLU
Senior Consultant
5999 CENTRAL AVENUE · SUITE 400 · ST. PETERSBURG, FLORIDA 33710
P.O. BOX 11629 33733-1629. (813) 384-3000. FAX (813) 345-3482