REPORT ON EXAMINATION OF MAPFRE INSURANCE COMPANY

REPORT ON EXAMINATION

MAPFRE INSURANCE COMPANY OF NEW YORK

(now known as PLYMOUTH ROCK ASSURANCE CORPORATION OF NEW YORK)

AS OF

DECEMBER 31, 2018

DATE OF REPORT MAY 31, 2020

EXAMINER WAYNE LONGMORE

TABLE OF CONTENTS

ITEM NO.

PAGE NO.

Scope of examination

Description of Company

A. Corporate governance

B. Territory and plan of operation

C. Reinsurance ceded

D. Holding company system

E. Significant ratios

Financial statements

A. Balance sheet

B. Statement of income

C. Capital and surplus

Losses and loss adjustment expenses

Subsequent events

Compliance with prior report on examination

Summary of comments and recommendations

One State Street, New York, NY 10004-1511 | (212) 480-6400 | www.dfs.ny.gov

ANDREW M. CUOMO

Governor

LINDA A. LACEWELL

Superintendent

May 31, 2020

Honorable Linda A. Lacewell

Superintendent

New York State Department of Financial Services

Albany, New York 12257

Madam:

Pursuant to the requirements of the New York Insurance Law, and in compliance with the instructions

contained in Appointment Number 32002 dated September 9, 2019, attached hereto, I have made an

examination into the condition and affairs of MAPFRE Insurance Company of New York, now known as

Plymouth Rock Assurance Corporation of New York, as of December 31, 2018, and submit the following

report thereon.

Wherever the designation “the Company” appears herein, without qualification, it should be understood to

indicate MAPFRE Insurance Company of New York.

Wherever the term “Department” appears herein without qualification, it should be understood to mean the

New York State Department of Financial Services.

The examination was conducted at the Company’s home office located at 901 Franklin Avenue, Garden

City, New York, 11530.

1. SCOPE OF EXAMINATION

The Department has performed an examination of the Company, a multi-state insurer. The previous

examination was conducted as of December 31, 2013. This examination covered the five-year period from

January 1, 2014, through December 31, 2018. Transactions occurring subsequent to this period were

reviewed where deemed appropriate by the examiner.

The examination was conducted in conjunction with the State of Massachusetts, which was the lead

state of the MAPFRE Insurance Group. The examination was performed concurrently with the

examinations of the following insurers: The Commerce Insurance Company, Citation Insurance Company,

Commerce West Insurance Company, MAPFRE Insurance Company, MAPFRE Insurance Company of

Florida, and American Commerce Insurance Company. Other states participating in this examination were

Massachusetts, California, Florida, Ohio, and New Jersey.

This examination was conducted in accordance with the National Association of Insurance

Commissioners (“NAIC”) Financial Condition Examiners Handbook, which requires that we plan and

perform the examination to evaluate the financial condition and identify current and prospective risks of

the Company by obtaining information about the Company including corporate governance, identifying and

assessing inherent risks within the Company and evaluating system controls and procedures used to mitigate

those risks. This examination also includes assessing the principles used and significant estimates made by

management, as well as evaluating the overall financial statement presentation, management’s compliance

with New York laws, statutory accounting principles, and annual statement instructions.

This examination report includes, but is not limited to, the following:

Company history

Management and control

Territory and plan of operation

Reinsurance

Holding company description

Financial statement presentation

Loss review and analysis

Significant subsequent events

Summary of recommendations

A review was also made to ascertain what action was taken by the Company regarding the

recommendations contained in the prior report on examination.

This report on examination is confined to financial statements and comments on those matters

that involve departures from laws, regulations or rules, or that are deemed to require explanation or

description.

2. DESCRIPTION OF COMPANY

MAPFRE Insurance Company of New York, now known as Plymouth Rock Assurance Corporation

of New York, was incorporated under the laws of the State of New York on August 14, 1954, as the

Truckmen’s Insurance Company. On February 15, 2012, its name was changed to State-Wide Insurance

Company. The present name was adopted on August 19, 2019. The Company was licensed September 9,

1954 and commenced business on October 1, 1954.

The Company was sold to Plymouth Rock Assurance Corporation (“PRAC”), effective January 1,

2019.

A. Corporate Governance

Pursuant to the Company’s charter and by-laws, management of the Company is vested in a board

of directors consisting of not less than seven persons. The board meets at least four times during each

calendar year. At December 31, 2018, the board of directors was comprised of the following eight members:

Name and Residence

Principal Business Affiliation

Randall Vaughn Becker

Webster, Massachusetts

Retired

Alfredo Castelo

Boston, Massachusetts

Chairman,

MAPFRE U.S.A. Corp.

David Hill Cochrane

Sandwich, Massachusetts

Retired

Francois Jean Facon

New York, New York

Director,

MAPFRE U.S.A. Corp.

Timothy John Morgan

Portland, Oregon

President and Chief Executive Officer,

AAA Oregon/Idaho

Kirk Richard Nelson

Sammamish, Washington

President and Chief Executive Officer,

AAA Washington

Name and Residence

Principal Business Affiliation

Daniel Patrick Olohan

Walpole, Massachusetts

Director,

MAPFRE U.S.A. Corp.

Mark Harry Shaw

Gahanna, Ohio

President and Chief Executive Officer,

AAA Ohio Auto Club

Due to the Company’s sale to PRAC, new board members were appointed in 2019. At December

31, 2019, the board of directors was comprised of the following seven members:

Name and Residence

Principal Business Affiliation

Harold Ronny Belodoff

Newton, Massachusetts

President,

The Plymouth Rock Company Incorporated

Mary Joyce Boyd

Hingham, Massachusetts

President and Chief Executive Officer,

Plymouth Rock Assurance Corporation

Colleen Mary Granahan

Newton Highlands, Massachusetts

Vice President,

The Plymouth Rock Company Incorporated

William Daniel Hartranft

Newton, Massachusetts

Vice President and Chief Financial Officer,

Plymouth Rock Assurance Corporation

John Conrad Hill

Brooklyn, New York

President,

Central Securities Corporation

Paul David Luongo

Westwood, Massachusetts

President and Chief Information Officer,

Shared Technology Services Group Inc.

Sandra Ann Urie

Winchester, Massachusetts

Chief Operating Officer and Chief Executive

Officer,

Cambridge Associates LLC

As of December 31, 2018, the principal officers of the Company were as follows:

Name

Title

Alfredo Castelo

President and Chief Executive Officer

Francois Jean Facon

Executive Vice President and Chief Financial Officer

Daniel Patrick Olohan

Executive Vice President, General Counsel and

Secretary

Robert Edward McKenna

Treasurer, Chief Accounting Officer and

Senior Vice President

Due to the Company’s sale to PRAC, new officers were appointed. As of December 31, 2019,

the principal officers of the Company were as follows:

Name

Title

Mary Joyce Boyd

President, Chief Executive Officer and

Chief Operating Officer

William Daniel Hartranft

Treasurer and Chief Financial Officer

Kristin Virginia Collins

Secretary

Certain conflict of interest statements, signed by officers and directors of the Company for the years

under examination, were not available for review. It is recommended that the Company maintain conflict

of interest statements at its home office for each year under examination.

A similar recommendation was included in the previous report on examination.

The Company was unable to document compliance with Section 312(b) of the New York Insurance

Law, which states:

“A copy of the report shall be furnished by such insurer or other person to

each member of its board of directors and each such member shall sign a

statement which shall be retained in the insurer's files confirming that such

member has received and read such report. The superintendent may require

that a copy of the report shall also be furnished by such insurer to the

supervising insurance official of each state in the United States in which such

insurer is authorized to do an insurance business.”

It is recommended that the Company comply with Section 312(b) of the New York Insurance Law

by furnishing each member of the board a copy of the report on examination and retaining a statement from

each board member that he or she has received and read such report.

A similar recommendation was included in the previous report on examination.

B. Territory and Plan of Operation

As of December 31, 2018, the Company was licensed to write business in the states of New Jersey

and New York.

As of the examination date, the Company was authorized to transact the kinds of insurance as

defined in the following numbered paragraphs of Section 1113(a) of the New York Insurance Law:

Paragraph

Line of Business

Fire

Miscellaneous property

Water damage

Burglary and theft

Glass

Animal

Collision

Personal injury liability

Property damage liability

Motor vehicle and aircraft physical damage

Marine and inland marine (inland only)

Based upon the lines of business for which the Company is licensed, and pursuant to the

requirements of Articles 13 and 41 of the New York Insurance Law, the Company is required to maintain

a minimum surplus to policyholders in the amount of $850,000.

The following schedule shows the direct and assumed premiums written by the Company for the

period under examination:

Calendar Year

Direct Premiums

Assumed Premiums

Total Gross Premiums

2014

$65,997,151

$ 75,050,164

$141,047,315

2015

$69,943,236

$103,925,782

$173,869,018

2016

$69,274,114

$ 98,698,218

$167,972,332

2017

$56,446,574

$ 99,137,708

$155,584,282

2018

$44,975,138

$ 98,012,382

$142,987,520

During the examination period, 100% of the Company’s direct premiums were written in New York.

The Company did not assume unaffiliated business during the examination period.

The Company's predominant lines of business were private passenger auto liability, homeowners’

multiple peril, and auto physical damage, which accounted for 43%, 33% and 24%, respectively of the 2018

direct written premiums.

The Company sold its products through New York licensed independent insurance agents who

represent multiple insurance companies. The Company’s distribution system consisted of over 540 agencies

located throughout New York.

Due to the pooling agreement described below, the net exposure of the Company was

significantly different than its direct and assumed exposure.

C. Reinsurance Ceded

Inter-Company Pooling Agreement

Effective December 22, 2006, the Company participated in an inter-company reinsurance pooling

agreement with various members of the MAPFRE Insurance Group. The Seventh Amended and Restated

Reinsurance Pooling Agreement among property and casualty insurance subsidiaries of MAPFRE U.S.A.

Corp. was made effective January 1, 2018, and supersedes all prior agreements including the Sixth

Amended and Restated Reinsurance Pooling Agreement that was effective as of January 1, 2015. This

agreement was filed with this Department pursuant to Section 1505(d) of the New York Insurance Law and

was non-disapproved on December 7, 2017. The agreement calls for each participating affiliate to cede

100% of its premiums (written and unearned), losses, loss expenses and underwriting expenses to The

Commerce Insurance Company (“Commerce”). The pooling agreement allows all companies to rely on the

capacity of the entire pool rather than on their own capital and surplus. Commerce, as the lead insurer of

the pool, assumes the direct business of all pool participants. All external reinsurance in the form of

catastrophe, quota share, facultative and excess of loss contracts is ceded to non-affiliated reinsurers by

Commerce. Commerce then cedes the net business after external reinsurance back to the pool participants

at the stated pooled participation percentages.

The following table shows the pool participants and their respective pro-rata pooling percentages as

of December 31, 2018:

Participating entity

Percentage

The Commerce Insurance Company (MA)

65.2

Citation Insurance Company (MA)

7.7

American Commerce Insurance Company (OH)

11.2

Commerce West Insurance Company (CA)

5.6

MAPFRE Insurance Company of New York

4.8

MAPFRE Insurance Company of Florida

3.2

MAPFRE Insurance Company (NJ)

2.3

Total

100.0

The Company’s participation in this pooling agreement was terminated on a cut-off basis when it

was acquired by PRAC effective January 1, 2019 (refer to section 5 of this report for further information).

Additionally, the reserve liabilities on both the assumed and ceded sides of the MAPFRE pool were

commuted.

Examination review found that the Schedule F data reported by the Company in its 2018 filed

Annual Statement accurately reflected its reinsurance transactions.

D. Holding Company System

At December 31, 2018, the Company was a member of the MAPFRE Insurance Group. The

Company was a wholly owned subsidiary of ACIC Holding Company, Inc. (“ACIC”), a Rhode Island

domiciled corporation, which, in turn, was a wholly owned subsidiary of MAPFRE U.S.A. Corp.

(“MUSA”), a Massachusetts corporation. MUSA, in turn, is a wholly-owned subsidiary of MAPFRE

Internacional S.A., which is a holding company for MAPFRE S.A.’s international operations.

MAPFRE S.A. is a multinational company engaged mainly in insurance and reinsurance activities,

operating in a total of 45 countries. It is based in Spain and is the largest non-life insurance company in

Latin America. MAPFRE S.A.’s shares are listed on the Madrid and Barcelona stock exchanges.

MAPFRE S.A. is ultimately controlled by Fundación MAPFRE, a global foundation with the aim

of achieving objectives of general interest to society including social action and the promotion of culture,

health, accident prevention, road safety, insurance and social security.

The following is a summary of ownership of the Company as of December 31, 2018:

Fundacion MAPFRE

Catera MAPFRE S.L.

MAPFRE S.A. (68.7%)

MAPFRE Asistencia Compania Internacional De Seguros y Reaseguros, S.A.

MAPFRE RE Compania De Reaseguros, S.A.

MAPFRE RE Vermont Corporation

MAPFRE Internacional S.A.

MAPFRE U.S.A Corp.

Commerce Insurance Company

MAPFRE Insurance Company of Florida

MAPFRE Insurance Company

Citation Insurance Company

Verti Insurance Company

BFS Holding Corporation

MAPFRE Life Insurance Company

MAPFRE Tech USA Inc.

ACIC Holding Co., Inc.

Commerce West Insurance Company

American Commerce Insurance Company

MAPFRE Insurance Company of New York

At December 31, 2018, the Company was party to the following agreements with other members of

its holding company system:

Management and Cost Allocation Agreement

Effective January 1, 2018, the Company and various affiliates (“the Companies”) entered into the

Sixth Amended and Restated Management Cost Allocation Agreement pursuant to which, any of the

Companies may provide certain management services, including investment and non-investment services,

to the other parties for a fee. Compensation for non-investment related services shall be limited in all cases

to not exceed the actual costs and expenses incurred by the party providing the services without a profit

factor built in. Compensation for investment related services is based on a percentage of the quarter-end

balance of investments and cash, not to exceed the actual costs and expenses incurred by the party

providing such services without a profit factor built into such costs or expenses.

This agreement replaced the Fifth Amended and Restated Management Cost Allocation Agreement

that was effective January 1, 2015. This agreement was filed with this Department pursuant to Section

1505(d) of the New York Insurance Law and was non-disapproved on December 7, 2017. During 2018, in

accordance with the terms of this agreement, the Company paid $7,881,226 to Commerce.

Tax Allocation Agreement

On January 1, 2018, the Company and various affiliates entered into the Fourth Amended and

Restated Tax Allocation Agreement with MUSA. Under this agreement, the Company and its affiliates will

file a consolidated federal income tax return for taxable year ending December 31, 2017 and for any

subsequent taxable period for which the affiliated group is required or permitted to file a consolidated return.

This agreement replaced the Third Amended and Restated Tax Allocation Agreement, dated

January 1, 2015. This agreement was filed with this Department pursuant to Section 1505(d) of the New

York Insurance Law and was non-disapproved on December 7, 2017.

E. Significant Ratios

The Company’s operating ratios, computed as of December 31, 2018 are as follows:

Net premiums written to policyholders' surplus

Result

393%

Adjusted liabilities to liquid assets

97%

Two-year overall operating

102%

The ratio results for the net premiums written to policyholders' surplus and two-year overall

operating ratios fall outside the benchmark ranges specified in the Insurance Regulatory Information System

of the NAIC.

Management notes that except for the two-year overall operating ratio, the remaining ratio

calculations are directly impacted by the sale of the Company to PRAC due to the accrual of a dividend to

ACIC in connection with that sale. Specifically, on December 21, 2018, the Department approved the sale

of the Company to PRAC. In connection with the transaction, the Department also approved the payment

of an extraordinary dividend by the Company to ACIC in the amount of $18 million. The sale of the

Company to PRAC closed effective January 1, 2019.

At December 31, 2018, the Company was still owned by ACIC and remained part of the MAPFRE

intercompany pooling agreement. Under this agreement, the Company and its insurance affiliates (as of

December 31, 2018) shared underwriting profit and losses in proportion to the pool participation

percentages. The Company’s pooling percentage under this agreement was 4.8% for 2018. The sharing of

4.8% of MAPFRE’s pooled underwriting profit and losses coupled with the lower surplus as regards

policyholders resulting from the $18 million dividend caused the net premiums written to policyholders'

surplus ratio to fall outside the NAIC’s usual range.

The Company’s elevated two-year overall operating ratio is a result of the lack of underwriting

profitability of its overall U.S. business, which has been adversely impacted by weather-related catastrophe

losses. Since the acquisition of control by PRAC, the Company has implemented new underwriting

guidelines.

Underwriting Ratios

The underwriting ratios presented below are on an earned/incurred basis and encompass the five-

year period covered by this examination:

Amount

Ratio

Losses and loss adjustment expenses incurred

$365,350,499

79.36%

Other underwriting expenses incurred

123,481,812

26.82

Net underwriting gain (loss)

(28,474,015)

(6.18)

Premiums earned

$460,358,296

100.00%

The Company’s reported risk-based capital (“RBC”) score was 348.7% as of December 31, 2018.

The RBC is a measure of the minimum amount of capital appropriate for a reporting entity to support its

overall business operations in consideration of its size and risk profile. An RBC score of 200% or below

can result in regulatory action. There were no financial adjustments in this report that impacted the

Company’s RBC score.

3. FINANCIAL STATEMENTS

A. Balance Sheet

The following shows the assets, liabilities and surplus as regards policyholders as of December 31,

2018, as reported by the Company.

Assets

Nonadmitted

Assets

Net Admitted

Assets

Bonds

$104,825,571

$ 0

$104,825,571

Cash, cash equivalents and short-term

investments

28,628,296

Investment income due and accrued

742,683

Uncollected premiums and agents' balances in

the course of collection

12,366,845

Amounts recoverable from reinsurers

3,346,734

Current federal and foreign income tax

recoverable and interest thereon

1,556,533

Net deferred tax asset

3,520,628

393,033

3,127,595

Electronic data processing equipment and

software

1,217

Furniture and equipment, including health care

delivery assets

263,410

Prepaid expenses

255,938

Miscellaneous assets - New York Limited

Assignment Distribution Program (“LAD”)

45,000

Miscellaneous assets

27,353

Total assets

$155,580,208

$912,381

$154,667,827

Liabilities, surplus and other funds

Liabilities

Losses and Loss Adjustment Expenses

$ 50,557,648

Reinsurance payable on paid losses and loss adjustment

expenses

4,647,796

Commissions payable, contingent commissions and other similar

charges

935,028

Other expenses (excluding taxes, licenses and fees)

1,231,455

Taxes, licenses and fees (excluding federal and foreign

income taxes)

Unearned premiums

50,321,344

Advance premium

770,851

Stockholders (dividends declared and unpaid)

18,000,000

Ceded reinsurance premiums payable (net of ceding

commissions)

2,555,353

Payable to parent, subsidiaries and affiliates

363,056

Payable for unclaimed checks

361,455

Total liabilities

$129,744,074

Surplus and other funds

Common capital stock

$ 850,000

Gross paid in and contributed surplus

924,800

Unassigned funds (surplus)

23,148,953

Surplus as regards policyholders

$ 24,923,753

Total liabilities, surplus and other funds

$154,667,827

NOTE: The Internal Revenue Service has completed its audits of the Company’s consolidated Federal

Income Tax returns through tax year 2015. All material adjustments, if any, made subsequent to the date of

examination and arising from said audits, are reflected in the company’s financial statements. There are no

tax years that are currently under examination. The Internal Revenue Service has not audited tax returns

covering tax years 2016 through 2018.

B. Statement of Income

The net loss for the examination period, as reported by the Company, was $4,191,004 as detailed

below:

Underwriting Income

Premiums earned

$460,358,296

Deductions:

Losses and loss adjustment expenses incurred

$365,350,499

Other underwriting expenses incurred

123,490,887

LAD program income

(9,075)

Total underwriting deductions

488,832,311

Net underwriting gain or (loss)

$(28,474,015)

Investment Income

Net investment income earned

$ 16,524,275

Net realized capital gain

2,965,636

Net investment gain or (loss)

$ 19,489,911

Other Income

Finance and service charges not included in premiums

$ 3,646,305

Miscellaneous income

46,277

Gain on sale of fixed asset

18,801

Total other income

$ 3,711,383

Net income before federal and foreign income taxes

$ (5,272,721)

Federal and foreign income taxes incurred

(1,081,717)

Net income (loss)

$ (4,191,004)

C. Capital and Surplus

Surplus as regards policyholders decreased $28,606,459 during the examination period January 1,

2014 through December 31, 2018, as reported by the Company, detailed as follows:

Surplus as regards policyholders, as reported

by the Company as of December 31, 2013

$ 53,530,212

Gains in

Losses in

Surplus

Net income

$ 4,191,004

Net unrealized capital gains or (losses)

$ 25,363

Change in net deferred income tax

1,164,262

Change in nonadmitted assets

345,819

Dividends to stockholders

25,419,031

Statutory intercompany expense pooling

3,570,458

Change in pooling cash settlement

370,236

DAC Change in pooling cash settlement

1,452,400

Net increase (decrease) in surplus

$3,966,057

$32,572,516

(28,606,459)

Surplus as regards policyholders, as reported

by the Company as of December 31, 2018

$ 24,923,753

Capital paid in is $850,000 consisting of 170,000 shares of $5 par value per share common stock.

Gross paid in and contributed surplus is $924,800. Gross paid in and contributed surplus did not change

during the examination period.

No adjustments were made to surplus as a result of this examination.

4. LOSSES AND LOSS ADJUSTMENT EXPENSES

The examination liability for the captioned items of $50,557,648 is the same as that reported by the

Company as of December 31, 2018. The examination analysis of the loss and loss adjustment expense

reserves was conducted in accordance with generally accepted actuarial principles and statutory accounting

principles, including the NAIC Accounting Practices & Procedures Manual, Statement of Statutory

Accounting Principle No. 55.

The Department accepts the Company’s net carried reserves as of December 31, 2018 of

$50,557,648 (concentrated in the personal and commercial lines of business). This finding is consistent with

the recommendation of the lead state, Massachusetts.

5. SUBSEQUENT EVENTS

1. As previously noted in this report on examination, effective January 1, 2019, the Company was sold

to PRAC, a Massachusetts domiciled property and casualty insurance company. PRAC is owned by The

Plymouth Rock Company Incorporated, a privately held Massachusetts corporation. PRAC writes

automobile insurance in Massachusetts and Connecticut, flood insurance in Massachusetts through FEMA

National Flood Insurance Program’s Write Your Own Program, and personal umbrella insurance in

Connecticut. PRAC entered the New York insurance market with its acquisition in 2018 of 21

Century

National Insurance Company (now known as Plymouth Rock Assurance Preferred Corporation), which

underwrites private passenger automobile business in the state of New York, and with its acquisition in

2019 of the Company, which primarily writes private passenger automobile insurance as well as

homeowners insurance in the state of New York.

The following is an abridged chart of the holding company system:

The Plymouth Rock

Company, Incorporated

(Massachusetts)

Plymouth Rock Assurance

Corporation

(Massachusetts)

NAIC #14737

Plymouth Rock Assurance

Corporation of New York

(New York)

NAIC #25275

In a letter dated August 16, 2018, the Department non-disapproved termination

agreements in connection with the Company’s participation in the previously mentioned MAPFRE Inter-

company Pooling Agreement, Management and Cost Allocation Agreement, and Tax Allocation

Agreement. The non-disapproval was contingent upon the Department’s approval of the Company’s

acquisition of control by Plymouth Rock Assurance Corporation and its controlling persons.

As previously mentioned, the Company’s participation in the MAPFRE Inter-company Pooling

Agreement was terminated on a cut-off basis when it was acquired by PRAC effective January 1, 2019. As

a result of the cut-off, the Company’s assumed unearned premiums of $50,321,000 and ceded unearned

premiums of $19,488,000 as of December 31, 2018, were both returned. It is noted that the amount reported

in the 2019 Annual Statement Schedule F Part 3 of $19,488,000 was not properly reported as a transaction

with Commerce; it was inadvertently reported as a transaction with Commonwealth Automobile Reinsurers.

Additionally, the reserve liabilities on both the assumed and ceded sides of the MAPFRE pool were

commuted.

The Department non-disapproved the addition of the Company to the following agreements with

various entities within the Plymouth Rock Insurance Group:

Plymouth Rock Pooling Agreement

Effective January 1, 2019, the Company became a party to an inter-company pooling agreement

with various entities in the Plymouth Rock Group. This agreement was filed with this Department pursuant

to Section 1505(d) of the New York Insurance Law and was non-disapproved on October 25, 2019.

Services Agreement

Effective January 1, 2019, the Company was added to this agreement through the execution of the

Sixth Amendment to the Services Agreement with various Plymouth Rock Group affiliates (“the

Companies”). Pursuant to the terms of this agreement, any of the Companies may provide certain services,

including legal, underwriting, accounting, and claims-related services, to the other parties for a fee based

on cost. This agreement and its amendments were filed with this Department pursuant to Section 1505(d)

of the New York Insurance Law and was non-disapproved on January 11, 2019.

Inter-Company Technology Development, Operations and Support Agreement

Effective January 1, 2019, the Company became a party to this contract through the execution of

the Fifth Amendment to the Second Amended and Restated Inter-Company Technology Development,

Operations and Support Agreement by and among various Plymouth Rock Group affiliates (“the

Companies”). Pursuant to the terms of this agreement, Shared Technology Services Group, Inc. provides

technology services, including development, support and maintenance services, to the other parties for a

fair and reasonable cost. This agreement and its amendments were filed with this Department pursuant to

Section 1505(d) of the New York Insurance Law and was non-disapproved on January 11, 2019.

Investment Services Agreement

This agreement was made effective January 1, 2019, between the Company and affiliate SRB

Corporation (“SRB”). Pursuant to the terms of the agreement, for a quarterly fee based on the value of the

fund, SRB will provide investment services, including the development of investment objectives, selection

of investment managers, asset and cash management. This agreement was filed with this Department

pursuant to Section 1505(d) of the New York Insurance Law and was non-disapproved on January 11, 2019.

2. On March 11, 2020, the World Health Organization declared an outbreak of a novel coronavirus

(“COVID-19”) pandemic. The risks and uncertainties surrounding the COVID-19 pandemic may impact

the Company’s, and its competitors’, operational and financial performance. The extent of the impact of the

COVID-19 pandemic on the Company’s operational and financial performance will depend on certain

developments, including the duration and spread of the outbreak, regulatory decisions, and the impact on

the financial markets. All of these developments are uncertain and cannot be predicted. The related financial

impact cannot be reasonably estimated at this time.

6. COMPLIANCE WITH PRIOR REPORT ON EXAMINATION

The prior report on examination contained the following recommendations (page number refers to

the prior report):

ITEM

PAGE NO.

Management

It was recommended that the Company comply with all of the provisions

of its Charter and Bylaws or amend them as necessary.

The Company has complied with this recommendation.

ii.

It was recommended that the Company maintain conflict of interest

statements at its home office for each year under examination.

The Company has not complied with this recommendation and a similar

recommendation is included in this report.

iii.

It was recommended that the Company comply with Section 312(b) of

the New York Insurance Law by furnishing each member of the board a

copy of the report on examination and retaining a statement from each

board member that he or she has received and read such report.

The Company has not complied with this recommendation and a similar

recommendation is included in this report.

Holding company system

It was recommended that the Company file its annual holding company

registration statements in a timely manner pursuant to the provisions of

Part 80-1.4 of Department Regulation 52.

The Company has complied with this recommendation.

Losses and loss adjustment expenses

It was recommended that, in the future, the Company book, at a

minimum, its actuary's point estimate.

The current examination revealed that the Company has maintained the

practice of booking reserves which are slightly below their appointed

actuary’s indicated point estimate. As the difference is immaterial (about

1%) and the current review concludes that the Company’s 2018 carried

reserves are reasonable, this prior examination recommendation is now

irrelevant.

7. SUMMARY OF COMMENTS AND RECOMMENDATIONS

ITEM

PAGE NO.

Management

It is recommended that the Company maintain conflict of interest

statements at its home office for each year under examination.

ii.

It is recommended that the Company comply with Section 312(b) of the

New York Insurance Law by furnishing each member of the board a copy

of the report on examination and retaining a statement from each board

member that he or she has received and read such report.

Respectfully submitted,

/S/

Wayne Longmore

Associate Insurance Examiner

STATE OF NEW YORK )

)ss:

COUNTY OF NEW YORK )

Wayne Longmore, being duly sworn, deposes and says that the foregoing report, subscribed by

him, is true to the best of his knowledge and belief.

/S/

Wayne Longmore

Subscribed and sworn to before me

this day of , 2020.