Subscriber Agreement Summary

BIX - Subscriber Agreement Summary

August 8, 2020
Written bySteve LekasCEO & Co-Founder



The Subscriber (“you” or “your”) to Branch Insurance Exchange (“BIX”), an Ohio domiciled reciprocal insurance

exchange, agrees together, with all other subscribers to BIX, that you shall be bound by the terms of this

Subscriber Agreement and Power of Attorney (“Agreement”).

1. Agreement to Exchange Policies

You hereby offer and agree to pay your policy premiums and to exchange with other BIX Subscribers policies

providing insurance for any insured loss as stated in those policies.

2. Power of Attorney

You hereby appoint Branch Financial, Inc., a Delaware corporation with its principal place of business in

Columbus, Ohio, (“BFI”) as the Attorney-in-Fact with the express authority and permission to effectuate and

conduct the lawful business affairs of BIX. This authority includes the ability to carry out all customary

functions of a reciprocal insurance exchange, including but not limited to the following responsibilities: (a)

Exchange, with other Subscribers to BIX, any and all kinds of reciprocal insurance contracts, which BIX is

authorized by law to write; (b) Issue, exchange, renew, non-renew, cancel or modify insurance policies; (c)

Adjust, settle, defend, litigate, appeal, and pay claims or losses under the insurance policies of members; (d) Act

as an intermediary to obtain reinsurance; (e) Accept service of process on behalf of BIX in actions against BIX

upon contracts exchanged; (f) Open accounts and borrow money in the name of BIX; (g) Hire and compensate

personnel and agents; (h) Collect premiums and invest and reinvest funds; (i) Receive notices and proof of loss;

(j) Enter into any lawful contracts for purposes of effectuating and conducting the lawful business affairs of

BIX; (k) Administer Subscriber Savings Accounts, including allocations thereto and distributions therefrom; (l)

make charitable donations on behalf of subscribers; and (m) Manage and conduct the business and affairs of

BIX, its affiliates and subsidiaries.

3. Management Fee and Expenses

You agree that as compensation for BFI becoming and acting as Attorney-in-Fact and managing the business

and affairs of Branch, BFI may retain 5% of all premiums written or assumed by BIX (the “management fee”).

The rest of the premiums will be retained by BIX and will be used for all expenses, including, but not limited to,

losses, loss adjustment expense, investment expenses, damages, legal expenses, court costs, taxes,

assessments, licenses, fees, any other governmental fines and charges, establishment of reserves and surplus,

and reinsurance, and may be used for other purposes BFI decides are to the advantage of Subscribers. BIX will

also be responsible for paying general administrative expenses incurred by BFI, including, but not limited to,

sales commissions, salaries and employee benefits, customer/policy acquisition expense, taxes, rent,

depreciation, and supplies. Any expense may be paid directly by BIX, or if paid by BFI, reimbursed separately

from the management fee.

4. Subscribers’ Advisory Forum

You understand that BFI and BIX have established a Subscribers’ Advisory Forum (“SAF”) to give Subscribers a

voice in the operation of BIX. The SAF is maintained under rules adopted herein by you, which are available for

review at, or upon request.

5. Subscriber Savings Accounts

BIX will maintain a separate individual Subscriber Savings Account (“SSA”) for each Subscriber, and may, in its

discretion, set aside a credit for each Subscriber. SSAs are maintained under rules adopted herein by you,

which are available for review at, or upon request. Pursuant to the terms of

the SSA Policy, Subscribers may become vested in a certain percentage of SSA funds according to a schedule

that rewards Branch loyalty. Additionally, Subscribers may be entitled to cash distributions of vested funds.

6. Surplus Contributions

The Subscriber agrees to pay their policy premium and agrees to make, in addition to policy premiums, a

surplus contribution equal to a certain percentage of all premiums to BIX (“Surplus Contribution”) based on the

surplus needs of BIX and subject to change as described herein. During the first five (5) full years of being

continuously insured by BIX with no lapse in coverage (“Continuous Membership”), the Surplus Contribution

will be up to fifteen percent (15%) of all premiums. Any changes to Surplus Contribution will apply

prospectively, starting with the next policy term. After five (5) years of Continuous Membership, the Surplus

Contribution will be two percent (2%) of all premiums. The Surplus Contribution is payable to BIX on or prior to

the initial effective date of coverage and on or prior to the effective date of all endorsements generating an

additional premium. The Subscriber understands and agrees that the amounts paid as Surplus Contributions

will be credited as policyholder surplus for the benefit and protection of BIX Subscribers and that Surplus

Contributions made to BIX are not premiums for insurance. Upon the issuance of an insurance policy, or any

other confirmation of coverage by BIX, the return of Surplus Contributions can occur only after withdrawal of

the Subscriber from BIX and, only with the approval of BFI and regulating authorities, where so required. BIX

will return any Surplus Contributions (without interest) made during that policy term on a pro-rata basis to

those Subscribers who terminate coverage for any reason. All other Surplus Contributions, including those

made on previous policy terms, will be retained by BIX for the benefit of all remaining Subscribers.

7. Application to Future Policies

You agree that this Agreement, including the Power of Attorney, shall have application to all insurance policies

for which you apply at BIX, including now and in the future, and it applies to any endorsements to or any

renewals, amendments, or modifications of any such policies. Should a policy be rewritten, this Agreement

also applies to the replacement policy issued to you without need for another execution of this Agreement.

8. Choice of Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Ohio.