Hartwell

(the Administrator)

In respect of the

CaliforniaHomeowners EarthquakeGuarantee (the “Guarantee”)

This Guarantee is a Contract arranged by the Administrator for the exclusive benefit of various Home owners who are also in addition Members of this Guarantee. It is a condition precedent of this Guarantee that the Members who are eligible to make a claim hereunder do so of their own accord and only in respect of any net retained losses under the applicable Earthquake deductible that exists under their Homeowners Insurance Policy or because they do not purchase a Homeowners Policy that covers the Peril of Earthquake.

  
The Guaranteed:Various Members of this Guarantee Program who are in possession of a valid Membership Certificate and unique Membership Number.
Guarantee Administrator:Hartwell Insurance Company. NOTE: This is NOT a contract of insurance.
Address of Administrator :100 Country Club Drive, Suite 108, Hendersonville, Tennessee 37075.
Type:Aggregate Guarantee Contract. Losses occurring during the Period of this Guarantee Contract.
Contract Term:Continuous from January 1st, 2020 at the address of the Administrator .
Guarantee Coverage:Damage to private homes in California fromEarthquakebut limited to the Net Retained amount that the Claimant(s) have under their Homeowners Insurance Policies or retain for themselves in the event that they do not purchase any Insurance for the Peril of Earthquake.
Eligibility:It is understood that in order forthe Guaranteed to be eligible for this Guarantee Contract that the Guaranteed must be an Owner of a Private Home in the State of California. It is a condition precedent to Membership of this Guarantee that no Commercial Activity is carried on at the premises that are the subject matter of this Guarantee.
Limits of Liability:Notwithstanding anything to the contrary, the Guarantor’s liability for Loss shall be limited as follows:

Per Occurrence Limit:
Uptothe value of the Rebuilding Cost per Member submitted in theGuarantee Membership Formeach and every loss, each and every Occurrence

Term Aggregate Limit:
Notwithstanding the Per occurrence limit stated above this Contract shall also be further limited by a Term Aggregate Limit. Such Term Aggregate limit will be no more than the amount of the Guarantee Fund at the time of the Loss Occurrence.

For the avoidance of doubt, at no time will the Guarantor’s Liability hereunder exceed the amount of Guarantee Payments collected and deposited into the Guarantee Fund at any one time in accordance with the Guarantee Fund Clause less any payments made from the Fund.

Payments for valid claims will be based on the number of valid claims received in any one calendar month. Should the value of all valid claims in a given month exceed the amount of funds available in the claims account, all claims filed that month shall receive a pro rata share of the funds that are available. If no funds are available in the fund, the Guaranteed shall not be entitled to any payment. To be valid, a claim must be filed within thirty (30) days from the date of loss.

The Aggregate Limit and the Per Occurrence Limit shall be inclusive of all expenses (“*Expenses*”).

The Guaranteed and all parties hereto understand and agree that the Administrator is not to be liable for any Loss in excess of the balance of the Guarantee Fund (See Guarantee Fund Clause below). In the event cumulative Loss at any point in time exceeds the cumulative payments held, or so deemed, in accordance with the Guarantee Fund Clause below (such excess amount to be referred to as the “*Excess Claim*”), the Administrator shall have no liability to pay the Excess.

“*Loss*” shall be defined as loss for all claims as detailed in this Contract plus all Expenses related to the payment of such claims.
Guarantee Fund Account:It is understood that the Administrator will open a Bank account for the payment of claims under this Contract. All Membership Payments net of the Guarantor’s Commissions will be paid into that account and the Administrator will maintain the Guarantee Fund Account for the purpose of payment of claims, all associated claims handling costs and any related expenses.

The Guarantee Fund Account will be held in cash at all timesin an interest bearing account, all interest will accrue to the Fund. It is expressly noted and understood that the Administrator does not and will not provide any investment advice and will not hold Funds in anything other than United States Dollars.
Deductibles:There are no applicable deductibles hereunder.
Membership Payment(s):To be a Member of this Guarantee and to be eligible for payments to be made from the Guarantee Fund an Annual Paymentis required. If the Member fails to pay such annual amount, then Membership will lapse at the Anniversary date and the Member will have no more claim to the Guarantee Fund.

Annual Membership Fees will be as follows:

Property Re-Building Value upto $100,000 – annual payment of $135.50

Property Re-Building Value from $100,000 but less than $500,000 – annual payment of $250

Property Re-Building Value from $500,000 but less than $1,000,000 – annual payment of $325

Property Re-Building Value more than $1,000,000 – annual payment of $450
No Price Increase:Once a member has joined then we further guarantee that there will be no price increase in Membership Fees unless the Member’s Re-Building costs changes category.
Administrator RemunerationThe Administrator will be paida Commission equal to 10% of each Member’s Annual Membership payment. A one-time joining fee, payable to the Administrator of $2.99 will be deducted from the first payment of each new member to the Fund.In addition, the Administrator will be paid a Fund Management Commission of 0.50% of the total amount in the Guarantee Fund. The Fund Management Commission will be paid in Twelfths at the end date of each month upon the balance of the Guarantee Fund at the end of each calendar month.Such Commissions do not form part of the payments for purposes of the Guarantee Claims Funding and shall not be utilized to cover any part of the Limit of Liability for this Contract. Such Commissions will remain the sole property of the Administrator.
Service of Suit:Service of process in any suit brought by the Guaranteed shall be uponHartwell Insurance Company, 100 Country Club Drive, Suite 108, Hendersonville, Tennessee 37075.
General Conditions:The Law applicable to this Guarantee Contract shall be that of the State of California.This is not a contract of insurance. Hartwell Insurance Company does not assume any liability for losses and is only obligated to perform in accordance with the express provisions of this contract. It is possible that the Guaranteed may receive less than full benefits or no benefits under this contract, even if a valid claim is filed, depending on the balance of the claims fund.
Claims Administration:Claims hereunder are to be administered by: Hartwell Insurance Company, Nashville, Tennessee, (the “*Claims Administrator*”). Hartwell Insurance reserves the right to appoint any sub claims administrator and all claims administration payments are to be made from the Guarantee Fund.
Guarantee Fund:It is understood and agreed that the Administrator will open and administer a Guarantee Fund Account into which all Payments due hereunder will be paid (the “*Guarantee Fund Account*”). Payments shall be credited to the Guarantee Fund Account on the date that such is due to the Administrator . The liability of the Administrator for the performance and discharge of all of itsobligations, howsoever they may arise, in relation to the Contract (“Obligations”) shall be limited to and payable solely from the proceeds of realization of the assets in the Guarantee Fund Account and accordingly there shall be no recourse to any other assets of the Administrator including, without limitation, to the Commission(s). In the event that the proceeds of realization of the assets of the Guarantee Fund Account are insufficient to meet all Obligations, any Obligations remaining after the application of such proceeds shall be extinguished, and the Guaranteed and the other parties hereto undertake in such circumstances to take no further action against the Administrator in respect of any such Obligations.

The Guaranteed and all other parties hereto accept and agree that the Guarantorshall bear no risk with respect to monies held, or required to be held, in the Guarantee Fund Account. In the event of the diminution of the Guarantee Fund Account for any reason, including insolvency of any party, investment losses or otherwise, failure to establish and/or maintain the Guarantee Fund Account, the liability of the Administrator shall be reduced by an amount equal to such reduction, or deemed reduction as applicable, in the Guarantee Fund Account.

The Guarantee Fund will be subject to an Independent audit every year. A Copy of any audit reports shall be furnished to Guaranteed’s upon request.
Guarantee Claims:For a Claim to be made hereunder the Guaranteed shall notify the Administrator by Email at calquakeclaims@hartwell-insurance.com. The Guaranteed must be in possession of a valid Membership Certificate and must quote the Membership Number in all correspondence. Claims must be filed withing thirty (30) days from the date of loss.
Guarantee Payments:Upon the approval/instruction of the Claims Administrator, all Guarantee Claims covered, together with all their related expenses and payable hereunder shall be paid out of the Guarantee Claim Account held and administered by the Administrator on behalf of the Guaranteed.

Payment will be made by the Administrator by check to the address of the Claimant.
Interpretation:Terms defined in the singular have a comparable meaning when used in the plural and vice versa.
Contract Cancellation:Either Party can cancel this Contract:

(i) The Guaranteed may Cancel this Contract ONLY by not continuing to pay the Annual Membership Fee.If the Guaranteed decides not to renew payment of the Annual Membership Fee then the Guaranteed’s Membership will cease to exist at the anniversary date. It is expressly to be understood that there is to be no return of any Membership Fee or any part of the Guarantee Fund to any Member who decides to Cancel their participation in this Guarantee.

(ii) The Administrator may cancel this Guarantee by giving ninety (90) days written notice to the Membership. In the event of Cancellation all monies (not including claims or outstanding claims upon the Guarantee Fund or Commissions or Claims Handling Fees owed to the Administrator ) residing in the Guarantee Fund Claim Account at the time of Cancellation shall be paid in full within 30 (thirty) calendar days, to the Guaranteeds on a pro rata basis based on their contributions into the fund.

Upon the date of Cancellation by either party all further liability shall cease for the Administrator and no further claim will be made by the Guaranteed upon the Administrator .
Insolvency:If the Administrator shall become Insolvent or be declared Bankrupt then this Contract will become immediately Cancelled at the date of such Insolvency or Bankruptcy and this Contract will then be subject to the Terms set out above in the Cancellation Clause.
Contract Documentation:To be issued by the Administrator off its Website: www.hartwell-insurance.com only. It is the responsibility of the Member to read this Guarantee and to accept the Terms and Conditions set out above and to Print and keep safe the Certificate of Guarantee Membership.