Best Practices for Service Providers / Accounting & Financial Reporting Issues Facing the Industry (GAAP, SAP, IFRS) Donald B. Rousso Paul Shanbrom Travis D. Clark Randall D. Ross #[insert hashtag here]

Preformation Matters #[insert hashtag here] In General  Initial government incorporation in the jurisdiction of formation  Insurance application documents and related documents in the jurisdiction of formation  Capitalization  Entity structure and formation  Initial underwriting  Actuarial analysis/services  Analysis of reserves, permitted assets and compliance with regulatory agencies  Drafting of policies  Coordination of other business and financial affairs so as to maximize the efficiency of the insurance company as it relates to existing business interests  Acquisition of insurance and/or reinsurance  Determination of proper basis for accounting

Post Formation Matters #[insert hashtag here] Accounting  Proper basis for accounting  Basic bookkeeping  Financial statement preparation (on a monthly or quarterly basis)  Annual audits by a certified public accountant  Moderation of NAIC and tax filings in conjunction with strategic partners, or through coordination of services with retained professionals  Submission of annual reports to the insurance regulators  Periodic audits and/or examinations by regulatory authorities as required Underwriting and Policy Issuance  Benchmark coverage and related premiums  Preparation of documentation including applications, policy documents, renewal invitations and premium payment confirmations and related notices  Review of third-party (traditional) insurance documentation, including reinsurance agreements  Periodic underwriting review

Post Formation Matters (cont’d) #[insert hashtag here] Claims Supervision, including coverage review, appointment of legal counsel, production of settlement documentation, provision of quarterly claims reports, annual audit of claim settlements, and assistance with claims reserves and liaison with actuary  Reporting  Adjustment  Case Reserves  IBNR  Payment  Financial integration  Issues

Post Formation Matters (cont’d) #[insert hashtag here] Actuarial Capital adequacy and dividends, reserve valuations, premium rating, long-duration UEPR, captive parent self-insured liabilities, premium deficiency reserves Corporate Corporate governance, including: o Registered office o Registered agent Ownership and responsibility for financial statements Corporate minutes/Corporate resolutions – annual and special Coordination of general corporate law matters and compliance Legal counsel in the captive domicile

Post Formation Matters (cont’d) #[insert hashtag here] General Insurance regulators Key service providers, including: o Actuary o Auditor o Accountant o Registered Office o Registered Agent o Legal counsel o Investment Advisor/Manager/Wealth Manager Regular discussion and updates with owners and risk managers Other Areas Annual licensing fees Premium taxes and self-procurement taxes Resident directors in jurisdictions requiring same Dissolution, liquidation or other matters in connection with the cessation of insurance activities

Contact Information #[insert hashtag here] Donald B. Rousso, President Paul Shanbrom, Executive Vice President 2010 Main Street, Suite 650 Irvine, CA Telephone: (949) Travis D. Clark 1025 Ridgeview Drive Suite 300 Reno, Nevada Telephone: (775) Randall Ross, ACAS, MAAA 7681 South Main Midvale, UT Telephone: