«DateToday»



OPEN CARGO POLICY

INSURANCE SUMMARY

Prepared for

SONY PICTURES ENTERTAINMENT INC.

POLICY PERIOD:

March 1, 2012 to March 1, 2013

The Lockton Companies thanks you for the opportunity to discuss your Insurance and Risk Management program. This summary is a brief overview of that program and is based on the exposure information you provided. Please refer to the policies for complete terms, conditions, limitations, definitions, and exclusions. Higher limits may be available upon request.

Lockton Companies does not guarantee, or make any representation in regard to, and expressly disclaims responsibility for, the financial condition of insurance companies with which we place business. Any rating information contained in this document has been obtained by a third-party rating agency, and we do not represent or warrant its accuracy.

|TABLE OF CONTENTS | |

|Account Management Team |Section 1 |

|Important Issues | Section 2 |

|Named Insured Schedule | Section 3 |

|Coverage Summary | Section 4 |

|Open Cargo | |

Section 1

__________________________________________________________________

Account Management Team

Marine Account Management Team

Resources

Lockton Insurance Brokers, LLC

Two Embarcadero Center, Suite 1700

San Francisco, CA 94111

Phone (415) 568-4000 ( Fax (415) 992-4083

CA License #0F15767

Section 2

__________________________________________________________________

Important Issues

Important Issues

Broker Disclosure

Lockton may receive compensation from an insurer or other intermediary as a result of the sale of insurance to you.

The compensation received by Lockton may differ depending on the product, insurer, and/or other intermediary.

Lockton may receive additional compensation for the insurer and/or other intermediary based upon other factors, such as premium volume placed with a particular insurer or through a particular intermediary and loss or claims experience.

Communication

Any requests that you make to confirm, bind, or alter your insurance program through e-mail, voice mail, or other automated systems will not take effect until you receive written communication from your Lockton representative.

Claim Reporting Requirements

Changing market conditions have had an adverse effect on many carriers’ claim reporting terms and conditions. Many policy forms now include verbiage that severely restricts or negates coverage should a carrier not be immediately notified of a claim or potential claim. Refer to your policies for a more complete explanation of your carrier’s reporting requirements.

Policy Delivery

Part of the Lockton commitment to you is to ensure the overall integrity of our product. Towards this goal, Lockton has developed a comprehensive quality control program customized to fit each client’s needs. Because we cannot always control the delivery of your policies from the carriers and because our policy-checking process requires additional time, receipt of your policies may be delayed. As a general rule, you should expect delivery at six months from inception date.

Terrorism

Overview

The September 11, 2001 attack on the World Trade Center altered the way carriers viewed Terrorism in the United States. Up to that point, Terrorism was not an excluded peril. In order to ensure the continued availability of coverage, Congress enacted the Terrorism Risk Insurance Act of 2002, a federally backed program. Insurers paying claims in response to certified acts of terrorism qualify for federal reimbursement. The amount of reimbursement to the carrier is based on the potential exposure written by that carrier. While the initial act was intended to serve as a temporary measure only, it was subsequently extended (Terrorism Risk Insurance Extension Act of 2005) to December 31, 2007.

On December 26, 2007, President George W. bush signed into law the Terrorism Risk Insurance Program Reauthorization Act of 2007 (TRIPRA). TRIPRA extends the Terrorism Risk Insurance Extension Act of 2005 (TRIEA) for another seven years until December 31, 2014. Had TRIEA expired on December 31, 2007, many businesses would have experienced difficulty obtaining terrorism coverage that lending institutions often require as a condition of real estate financing.

Provisions of TRIPRA include:

❖ Eliminates the artificial distinction between domestic (not previously covered by TRIA) and foreign acts of terrorism for the purposes of certifying a terrorism event.

❖ Protects insurer risk retentions by preserving the Terrorism Risk Insurance Extension Act of 2005 (TRIEA’s) current deductible, coinsurance, and $100 million loss trigger structure.

❖ Clarifies the levels at which insurers’ respective TRIEA deductible and coinsurance levels are capped in the event of a loss.

❖ Mandates ongoing reports to Congress on inclusion of group life coverage and nuclear, biological, chemical, and radiological events.

Who does the Act apply to?

❖ All commercial property and casualty insurers (except as respect health, medical malpractice, surety, automobile liability, professional liability (except D&O), certain federally backed insurance programs, and reinsurance) must offer coverage for Certified Acts of Terrorism annually.

What constitutes a Certified Act of Terrorism?

❖ To qualify as a certified act of terrorism, the incident must:

1. Be a violent act or an act that is dangerous to human life, property, or infrastructure.;

2. Cause damage within the U.S. or other area of U.S. sovereignty (e.g., a U.S. embassy, airplane, ship);

3. Be committed by someone acting on behalf of a foreign person or foreign interest as part of an effort to coerce the civilian population of the U.S., to influence the policy or affect the conduct of the U.S. government by coercion;

4. Produce property and casualty insurance losses in excess of $5,000,000

Nonadmitted Carriers (Surplus Lines)

This is to inform you that some of your policies may have been placed with a nonadmitted carrier. If all or part of your coverage is written through a nonadmitted carrier, it will be so indicated in the individual coverage section.

Nonadmitted insurance carriers are neither licensed by nor under the supervision of the state department of insurance. If a nonadmitted insurer becomes insolvent, it is unlikely that the State Guaranty Fund will respond (State Guaranty Funds typically only apply to admitted carriers and provide limited, if any, coverage). For an overview of each state’s provisions, go to:

and click on:

Summary of NAIC Post-Assessment Property & Liability Insurance Guaranty Assoc Model Act (doc)

AM Best Ratings

Founded in 1899, A.M. Best is recognized as one of the world’s oldest and most authoritative sources of insurance company ratings and information. Best’s ratings are the industry’s standard measure of insurer financial performance.

A.M. Best ratings reflect a company’s stability and desirability based on the following factors:

❖ Profitability

❖ Leverage

❖ Liquidity

❖ Amount and Soundness of Reinsurance

❖ Adequacy of Reserves

❖ Management

Best’s rating classifications are:

A++ and A+ (Superior)

A and A- (Excellent)

B++ (Very Good)

B and B- (Good)

C+++ (Fair)

C and C- (Marginal)

Financial stability ranges from Class I (the smallest) to Class XV (the largest) as designated below.

|Class I, II, III, IV, V…………………….. |$ 0 |to |$ 25,000,000 |

|Class VI…………………………………. |$ 25,000,000 |to |$ 50,000,000 |

|Class VII………………………………... |$ 50,000,000 |to |$ 100,000,000 |

|Class VIII……………………………….. |$ 100,000,000 |to |$ 250,000,000 |

|Class IX…………………………………. |$ 250,000,000 |to |$ 500,000,000 |

|Class X………………………………….. |$ 500,000,000 |to |$ 750,000,000 |

|Class XI…………………………………. |$ 750,000,000 |to |$ 1,000,000,000 |

|Class XII………………………………... |$ 1,000,000,000 |to |$ 1,250,000,000 |

|Class XIII……………………………….. |$ 1,250,000,000 |to |$ 1,500,000,000 |

|Class XIV……………………………….. |$ 1,500,000,000 |to |$ 2,000,000,000 |

|Class XV………………………………... |$ 2,000,000,000 |to |or more |

For more information about A.M. Best, visit its Website at /index.html.

Section 3

_________________________________________________________________

Named Insured Schedule

Named Insured Schedule:

Sony Pictures Entertainment Inc.

and any and all of its subsidiaries, divisions, associated and/or affiliated companies now exiting or hereafter created or acquired, and their financially controlled or actively managed organizations or undertakings, including partnerships and joint ventures, and any other organizations, entities or persons which they have a written or oral agreement to insure.

Section 4

_________________________________________________________________

Coverage Summary

CARGO COVERAGE

|INSURER: |Zurich American Insurance Company |

| |AM Best Rating: A XV |

|POLICY NUMBER: |OC8338394 |

|POLICY TERM: |Effective: March 1, 2012 at 12:01 AM Local Standard Time at the Address of the Assured |

| | |

| |Expiring: Open and Continuous and Covering All Shipments on and after the Inception Until |

| |the Policy is Cancelled |

|LIABILITY LIMITS: |Any One Vessel and Connecting Conveyances, |

| |or in Any One Place at Any One Time……………………...$2,500,000 |

| | |

| |EXCEPT: |

| |Worldwide Exhibition Coverage…………...…...………………$2,500,000 |

| |Any One Aircraft or Connecting Conveyance |

| |or in respect of Air Express and/or Airfreight |

| |Shipments, Express Mail or Similar Service….…….…..…$2,500,000 |

| |On Deck Any One Vessel Subject to On Deck Bill of Lading.......$100,000 |

| |Any One Package Transported by Mail, Parcel Post |

| |or Similar Services………………………………………........$100,000 |

|DEDUCTIBLE: |Transit…………………………………………………………………None |

| |Exhibition……………………………………………………………$5,000 |

|PERILS: | “All Risks” of physical loss or damage from an external cause, including War, Strikes, |

| |Riots, Civil Commotion, subject to policy terms, conditions and exclusions. |

|GOODS INSURED: |The interests insured under this policy are goods and/or merchandise and/or property of |

| |every description consisting principally of, but not limited to films, videotapes, track |

| |negatives, trailer negatives, costumes, props, and similar property used in the Assured’s |

| |business owned, used, or intended for use by the Assured, or hereafter required. |

|MAJOR CONDITIONS: |Valuation |

| | |

| |The goods and/or merchandise and /or property insured under this policy shall be valued at |

| |the value declared by the insured or at replacement cost, plus all charges including prepaid|

| |or advanced or guaranteed freight, if any. |

| | |

| |U.S. Economic and Trade Sanctions Clause |

|FORM EXTENDED TO INCLUDE: | |

| |Worldwide |

| |Warehouse to Warehouse Endorsement |

| |Exhibition Coverage Automatically Extended to Include Incidental Storage (up to 60 days) |

| |Terrorism Risk Insurance Act (TRIA) |

|MAJOR EXCLUSIONS: |Chemical, Biological, Bio-Chemical, and Electromagnetic Terrorism Exclusion Clause |

| |Extended Radioactive Contamination Exclusion Clause |

|CANCELLATION: |60 days notice of cancellation, EXCEPT: |

| |May be cancelled by either party upon forty-eight hours written, telegraphic or telefaxed |

| |notitice to the other party for War, Strikes, Riots & Civil Commotions |

|PREMIUM: |Marine Transit & War: $12,000 Deposit Premium |

| |Exhibition: $ 9,000 Flat Annual Premium |

|RATE: |Marine Transit & War: .08% Applied Against Total Insured Values |

| |Import Duty: 1/3 Marine Rate |

|AUDIT: |Marine & War Premium Adjusted Annually – based on total insured values |

-----------------------

Lockton Insurance Brokers, LLC

CA License #0F15767

Two Embarcadero Center, Suite 1700

San Francisco, CA 94111

Ph: (415) 568-4000 / Fax: (415) 992-4000

Tom Denniston

Executive Vice President

415-568-4086

tdenniston@

Jacquelyn Neal

Account Manager

415-568-4039

jneal@

Mona Lindahl-Babcock

Account Executive

415-568-4088

mbabcock@

Joy conklin

Account Administrator

415-568-4017

slmurphy@

Paul Hodges

Marine Claims Coordinator

415-568-4061

phodges @

Betsy Carpenter

Marine Contract Review

415-568-4080

bcarpenter @

................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download