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Premium Procedures

TPAC Underwriters will provide a Premium Worksheet for each Policyholder for the purpose of premium payments; all information on the worksheet is essential for the processing of payments.

It is important to note that the policies and procedures outlined in this section of the manual are general in nature. The specific requirements of each carrier's application and policy language are binding upon the Policyholder. Language contained in this manual cannot be relied upon to bind the carrier or Policyholder in any manner that differs from the coverages expressly stated within their contract.

A. Premium Payments

The initial premium should be submitted along with the Premium Accounting Worksheet and signed Application by the proposed effective date of the contract. The initial premium should be equal to the first month's aggregate premium plus the first month's specific premium. The checks will be deposited in an escrow account until final underwriting is completed.

Premiums for the second and subsequent months of the Contract are due on the first day of each calendar month following the proposed Effective Date of the Contract (whether or not the proposed Effective Date is the first day of the month).

Please make checks payable to:

TPAC Underwriters
3810 Pheasant Ridge Drive NE
Suite 300
Minneapolis, MN 55449

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B. Late Premium Procedures

Premium is considered past due if not received by the dates established above and may result in TPAC Underwriters making appropriate contact to determine the delay. TPAC intends to notify all TPAs, Brokers and Producers with Policyholders for whom premium has not been received by the 20th of the month. The notice will inform the TPA, Broker or Producer (which is deemed to be notice to the Policyholder), that premium has not been received and that termination or rescission will take place without further notice at the end of the grace period as defined in the carrier contract.

Please note that it is your independent responsibility to make certain that premiums are paid. You are not entitled to rely upon the expectation of premium notices in order to trigger responsibility for payment of premium. Coverage may be rescinded or terminated whether or not the late premium notice mentioned above was sent or received.

Delayed premium payments that could justify rescission are considered independently from prior payments and how those payments were treated. Prior premium payment delay does not constitute waiver by the Carrier and may not be used to create any release of responsibility for timely submission of current and future payments.

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C. Enrollment Standards

Under certain circumstances at the discretion of the Carrier, a given monthly premium total may be revised due to enrollment fluctuations. Premium revisions shall not be permitted that are based on enrollment adjustments in excess of ninety (90) days from the first of the month in which TPAC receives a request for premium revision.

Back charges or credits of more than 90 days for any employee must have supporting documentation that explains the delay in change notification. TPAC, on behalf of the Carrier, will approve or disapprove these adjustments on a case-by-case basis.

Enrollment changes of more than 10% from the effective date of coverage must be reported to TPAC. TPAC has the right to change rates and/or factors in order to adjust for changes in plan participation. If the total enrollment drops below a preset minimum number of lives as established within each carrier policy, TPAC on behalf of the carrier, may terminate the coverage. No action will be taken without notifying the TPA or Broker.

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D. Terminations

There are occasions that warrant termination of an employer's Contract. The following includes some but not necessarily all conditions that will result in termination of coverage.

Non-Payment of Premium

Premium is due on the first day of the month with a grace period as defined in each carrier's contract. If not received within the grace period, (31 days from effective date), the Policyholder may be considered terminated without further notice. This type of termination may also take place if premium is not paid according to the Contract terms. Examples of the latter would be an event of nonpayment of annual advance premiums or when there is only partial payment of premium due.

In the event that a check is returned due to non-sufficient funds and termination results, the TPA, Broker and/or Producer will be notified. The premium due must be express mailed in the form of a certified check or money order and received within three (3) business days in order to prevent termination for nonpayment of premium.

In the event that premium is not paid within the grace period and a Contract has not been issued, TPAC on behalf of the Carrier would rescind coverage.

Termination at the Policyholder's Request

The Policyholder, upon written request to TPAC, may initiate termination at which time, all minimum Annual Premiums are due and no refunds (such as commission refunds and prepaid annual refunds) will be recoverable.

Change of Third Party Administrator

If a plan sponsor is terminating its claims administration service, we will terminate the excess loss coverage effective on the date the Plan Sponsor terminates administration.

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E. Reinstatement

Once the coverage has terminated or has lapsed, reinstatement can only be accomplished after a thorough underwriting review. Outstanding premiums, current claims information, a Disclosure Statement, as well as any other relevant documentation must be submitted to TPAC prior to consideration of Reinstatement. This documentation must be submitted for review within sixty (60) days after the termination date. Once this information is submitted and reviewed, the case may or may not be reinstated solely at the direction of the Carrier or its representative. If the case is not reinstated, all reinstatement premiums will be refunded.

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F. Required Documents

If TPAC does not receive all of the documents requested on behalf of the Carrier for issuance of the Reinsurance Contract within ninety (90) days of the proposed Effective Date of the new Contract, then TPAC, on behalf of the Carrier, will rescind coverage back to the proposed Effective Date.

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