Toll-free number: 1-66-434-557 LIBERTY INSURANCE UNDERWRITERS INC. (A Stock Insurance Company, hereinafter the Company ) 55 Water Street, 23rd Floor, New York, NY 10041 RENEWAL APPLICATION UNLESS OTHERWISE ENDORSED, CLAIM EXPENSES SHALL BE APPLIED TO, AND ACT AS A REDUCTION OF, UP TO 100 OF THE DEDUCTIBLE, AND UP TO 100 OF THE LIMITS OF INSURANCE. THIS COULD THEN RESULT IN SUCH DEDUCTIBLE AND SUCH LIMIT OF INSURANCE BECOMING COMPLETELY EXHAUSTED BY THE PAYMENT OF CLAIM EXPENSES. THE COMPANY SHALL NOT BE LIABLE FOR ANY CLAIM EXPENSES OR DAMAGES UNTIL AFTER THE EXHAUSTION OF THE DEDUCTIBLE, AND THE COMPANY SHALL NOT BE LIABLE FOR ANY CLAIM EXPENSES OR DAMAGES AFTER THE EXHAUSTION OF THE LIMITS OF INSURANCE. THIS POLICY ONLY COVERS CLAIMS ACTUALLY MADE AGAINST AN INSURED UNDER THE POLICY WHILE THE POLICY REMAINS IN EFFECT. CLAIMS MAY BE REPORTED, HOWEVER, DURING THE CLAIMS MADE RELATIONSHIP OR DURING THE AUTOMATIC EXTENDED CLAIM REPORTING PERIOD OR ANY ADDITIONAL REPORTING PERIOD YOU MAY PURCHASE. ALL COVERAGE UNDER THIS POLICY CEASES UPON TERMINATION OF THE POLICY, EXCEPT FOR THE AUTOMATIC EXTENDED REPORTING PERIOD COVERAGE, UNLESS THE INSURED PURCHASES ADDITIONAL EXTENDED REPORTING PERIOD COVERAGE. THIS POLICY PROVIDES NO COVERAGE FOR CLAIMS ARISING OUT OF INCIDENTS, SITUATIONS OR ACTS OR OMISSIONS WHICH TOOK PLACE PRIOR TO THE PRIOR ACTS DATE, IF ANY, STATED IN POLICY. DURING THE FIRST SEVERAL YEARS OF THE CLAIMS-MADE RELATIONSHIP, CLAIMS-MADE RATES ARE COMPARATIVELY LOWER THAN OCCURRENCE RATES. SUBSTANTIAL ANNUAL PREMIUM INCREASES CAN BE EXPECTED, INDEPENDENT OF OVERALL RATE LEVEL INCREASES, UNTIL THE CLAIMS-MADE RELATIONSHIP REACHES MATURITY. THE FOLLOWING EXTENDED REPORTING PERIODS ARE AVAILABLE UPON TERMINATION OF COVERAGE AND THE NAMED INSURED SHALL BE CHARGED A PERCENTAGE OF THE POLICY S PREMIUM, USING RATES IN EFFECT ON THE EFFECTIVE DATE OF THE POLICY. POTENTIAL COVERAGE GAPS MAY ARISE UPON EXPIRATION OF EXTENDED REPORTING PERIOD COVERAGE. Extended Reporting Period 60-day Automatic Extended Reporting Period 1 Year Optional Extended Reporting Period 3 Year Optional Extended Reporting Period 5 Year Optional Extended Reporting Period 1 Maximum Percentage of Annual Premium Additional Premium 95 220 250
Toll-free number: 1-66-434-557 A. FIRM INFORMATION Firm Name: Primary Office Address: Contact Person: Firm Email: 1. City: Title: Firm Phone: St: Zip: Contact Phone: Does your firm or any owner, partner or officer render services or conduct any business activities under any other name? If there are changes from previous year, complete the SEPARATE ENTITY SUPPLEMENT on page S-1 Please complete the remainder of the application with respect to the firm and all entities listed previously and currently on the Separate Entity Supplement. Wherever the words firm affiliates are used, they will be deemed to include these entities. 2. 3. Please indicate the number of personnel for your firm and firm affiliates: CPA Owners, Partners & Officers n CPA Owners, Partners & Officers Employed CPAs (other than identified above) Other Accounting or Tax Professionals Consulting Professionals Support Staff ( all others) Total Firm Personnel Gross annual revenue for the firm and firm affiliates on an accrual basis: Last Fiscal Year Estimated Current Fiscal Year FYE: FYE: $ $ If estimated current fiscal year revenues are more than +/- 15 from the last fiscal year revenues, provide an explanation on a separate sheet. B. SCOPE OF PRACTICE 4. Provide the percentage of gross annual revenue derived from the following areas of practice. Total of all items must equal 100. Are annual engagement Are annual engagement letters used? letters used? A. Business Tax Services L. Other Attest/Assurance Services B. Estate Tax Services (Please describe) C. Individual Tax Services M. Business Planning (Please describe) D. Accounting/Bookkeeping N. Business Valuation E. Compilation O. Litigation Consulting F. Review P. n-trustee Fiduciary or G. Audit: Publicly held clients Administrative Responsibility- ERISA, complete the Public Audit Supplement Pension & Benefit Plans, ESOPS, H. Audit: n-public clients Insurance Co s, Hedge Funds, other complete the n- Public Audit Investment Co s. (Please describe and include Supplement client list with asset size and number of 2
Toll-free number: 1-66-434-557 I. Agreed Upon Procedures J. Projections/Forecasts participants) Q. Information Technology K. Financial Planning and Investment Advisory Services R Other Consulting (Please describe) Complete the Financial Planning Supplement 5. Estimated total number of clients for last fiscal year: 6. Percentage of revenue from largest client: Client industry: TOTAL ADDS TO 100 Client name: Services rendered by firm: C. CHANGES TO YOUR PRACTICE Answer only when there is new information that was not provided on previous years applications. 7. Have there been any changes in the organization or structure of the firm or addition of a new client industry or scope of practice? If so, complete the appropriate Supplement. Performed audit, review, attestation or consulting services to publicly-held companies, their subsidiaries or their employee benefit plans? If yes, complete the PUBLIC COMPANY SUPPLEMENT on page S-3. 10. Served as a trustee, co-trustee, executor, administrator or personal representative? If yes, complete the TRUSTEE & ESTATE SUPPLEMENT on page S-5. 11. Controlled or disbursed client funds (including payroll)? If yes, complete the FUNDS CONTROLLED SUPPLEMENT on page S-6. 12. Performed services or consented to the use of your work product in connection with public or private offerings of securities, real estate or other investments? If yes, complete the PUBLIC & PRIVATE OFFERINGS SUPPLEMENT on page S-6. 13. rendered services, other than tax, for any client in which firm personnel, or the spouse of firm personnel, owned or received an equity interest or served as an officer, director, partner, manager or other member of a client's governing body? If yes, complete the OUTSIDE INTEREST SUPPLEMENT on page S-. 14. arranged debt or equity financing or acted as a business broker? If yes, provide the name of each client, the services rendered, and the amount and form of compensation paid to your firm, firm affiliates or their personnel on a separate sheet. Within the past year, has your firm, firm affiliates or their personnel:. Obtain a professional license other than a CPA license? If yes, provide person's name, type of license, revenues from activity, professional liability insurer, limits of liability and expiration date of policy on a separate sheet. 9. 3
Toll-free number: 1-66-434-557 15. rendered services, other than tax, for a business client that subsequently declared or filed bankruptcy, defaulted on a debt obligation or became insolvent? If yes, provide the following: Name of client and client industry 4 Type of services you rendered and dates of your services Type of audit opinion Going concern reference? Date of bankruptcy, insolvency or default
Toll-free number: 1-66-434-557 D. QUALITY CONTROLS 16. Within the past year, has your firm or firm affiliates sued to collect fees, including small claims court? If yes, provide on a separate sheet the amount, status, reason for suit and procedures for monitoring outstanding fees. 17. Within the past three years, has your firm undergone a peer or quality review offered by the AICPA or any state CPA Society? Opinion rendered: Unqualified/Unmodified Qualified/Modified Other Date issued: If there was a letter of comments or the opinion was Qualified, Modified or Other, please attach a copy of the Peer Review Report as well as the Letter of Comments and the firm's Letter of Response and the same data from the firm's prior peer review. If your firm has NOT undergone peer review and provides compilation, review and/or audit services, please indicate the anticipated date of review. If no review planned please explain why. E. CLAIMS INFORMATION 1. After inquiry of all owners, partners, officers and professionals of the firm and firm affiliates, within the past year have any past or present personnel: (a) been the subject of any regulatory or disciplinary investigation or inquiry (both formal and informal) or suspended from practice? (b) charged or plead guilty to, or indicted on a criminal charge? (c) become aware of any act, omission, circumstance or fee dispute which might be expected to be the basis of a claim or suit? (d) received updated information on any claim or potential claim reported to a carrier other than the Company? If yes to ANY, complete CLAIM/INCIDENT SUPPLEMENT on page S-9. Remember, any claim or incident should be reported to the Company within the policy period. NOTICE 1. Neither the responses to this application nor any attachments thereto constitute a submission of a claim or notice of circumstances, occurrences or potential claims under any existing insurance policy. r does any such responses indicate or imply that any claim, act or omission disclosed will be covered by this policy. 2. Applicant's failure to report to its current insurance company any claim made against it during the current policy term, or act, omission or circumstance which Applicant is aware of which may give rise to a claim before the expiration of the current policy may create a lack of coverage F. COVERAGE SELECTION 25. 26. Limits of Liability: $ Deductible: $ (Indicate your desired coverage selection) Per Claim or Annual Aggregate G. OPTIONAL COVERAGES If you are interested in a quotation, check the box by the desired coverage option and complete the appropriate supplement. Quotations are subject to underwriting approval. 27. Registered Representative Coverage. Complete the Financial Planning and Investment Advisory Services Supplement on page S-1. 2. Life Insurance Agent Coverage. Complete Question 10 of the the Financial Planning and Investment Advisory Services Supplement on page S-3. 29. Employee Dishonesty Coverage. Complete the Funds Controlled Supplement on page S-6. 30. Outside Organization Directors & Officers Defense Coverage. Complete the D&O Defense Supplement on page S-10. 5
Toll-free number: 1-66-434-557 31. 10. 32. Employment Practices Liability Defense Coverage. Complete the Employment Practices Defense Supplement on page SAccountants Privacy and Network Security Risk Coverage. Complete the Privacy and Network Security Risk Supplement on page S-11. ADDITIONAL INFORMATION Attach separate sheets with all additional information, as necessary. Please indicate the question number and date when providing additional information. False Information (All States Except AL, AR, CO, DC, FL, HI, KY, LA, ME, MD, NJ, NM, NY, OH, OK, OR, PA, RI, TN, VA, VT, WA, WV): Any person who, knowingly and with the intent to defraud any insurance company or other person, files an application for insurance containing any false information, or conceals for the purpose of misleading, information concerning any fact material thereto, commits a fraudulent insurance act, which is a crime. ALABAMA APPLICANTS: Any person who knowingly presents a false or fraudulent claim for payment of a loss or benefit or who knowingly presents false information in an application for insurance is guilty of a crime and may be subject to restitution fines or confinement in prison, or any combination thereof. ARKANSAS, LOUISIANA, RHODE ISLAND AND WEST VIRGINIA APPLICANTS: Any person who knowingly presents a false or fraudulent claim for payment of a loss or benefit or knowingly presents false information in an application for insurance is guilty of a crime and may be subject to fines and confinement in prison. COLORADO APPLICANTS: It is unlawful to knowingly provide false, incomplete, or misleading facts or information to an insurance company for the purpose of defrauding or attempting to defraud the company. Penalties may include imprisonment, fines, denial of insurance, and civil damages. Any insurance company or agent of an insurance company who knowingly provides false, incomplete, or misleading facts or information to a policyholder or claimant for the purpose of defrauding or attempting to defraud the policy holder or claiming with regard to a settlement or award payable for insurance proceeds shall be reported to the Colorado division of insurance within the department of regulatory agencies. DISTRICT OF COLUMBIA APPLICANTS: WARNING: It is a crime to provide false or misleading information to an insurer for the purpose of defrauding the insurer of any other person. Penalties include imprisonment and/or fines. In addition, an insurer may deny insurance benefits if false information materially related to a claim was provided by the applicant. FLORIDA APPLICANTS: Any person who knowingly and with intent to injure, defraud or deceive any insurance company files a statement of claim containing any false, incomplete, or misleading information is guilty of a felony of the third degree. HAWAII APPLICANTS: For your protection, Hawaii law requires you to be informed that presenting a fraudulent claim for payment of a loss or benefit is a crime punishable by fines or imprisonment, or both. KANSAS APPLICANTS: Any person who, knowingly and with intent to defraud, presents, causes to be presented or prepares with knowledge or belief that it will be presented to or by an insurer, purported insurer, broker or any agent thereof, any written statement as part of, or in support of, an application for the issuance of, or the rating of an insurance policy for personal or commercial insurance, or a claim for payment or other benefit pursuant to an insurance policy for commercial or personal insurance which such person knows to contain materially false information concerning any fact material thereto; or conceals, for the purpose of misleading, information concerning any fact material thereto commits a fraudulent insurance act. 6
Toll-free number: 1-66-434-557 KENTUCKY APPLICANTS: Any person who knowingly and with intent to defraud any insurance company or other person files an application for insurance containing any materially false information or conceals, for the purpose of misleading, information containing any fact material thereto commits a fraudulent insurance act, which is a crime. MAINE, TENNESSEE AND VIRGINIA, AND WASHINGTON APPLICANTS: It is a crime to knowingly provide false, incomplete or misleading information to an insurance company for the purpose of defrauding the company. Penalties may include imprisonment, fines or a denial of insurance benefits. MARYLAND APPLICANTS: Any person who knowingly or willfully presents a false or fraudulent claim for payment of a loss or benefit or who knowingly or willfully presents false information in an application for insurance is guilty of a crime and may be subject to fines and confinement in prison. NEW JERSEY APPLICANTS: Any person who includes any false or misleading information on an application for an insurance policy is subject to criminal and civil penalties. NEW MEXICO APPLICANTS: Any person who knowingly presents a false or fraudulent claim for payment of a loss or benefit or knowingly presents false information in an application for insurance is guilty of a crime and maybe subject to civil fines and criminal penalties. NEW YORK APPLICANTS: Any person who knowingly and with intent to defraud any insurance company or other person files an application for insurance or statement of claim containing any materially false information, or conceals for the purpose of misleading, information concerning any fact material thereto, commits a fraudulent insurance act, which is a crime and shall also be subject to a civil penalty not to exceed five thousand dollars and the stated value of the claim for each such violation. OHIO APPLICANTS: Any person who, with intent to defraud or knowing that he is facilitating a fraud against an insurer submits an application or files a claim containing a false or deceptive statement is guilty of insurance fraud. OKLAHOMA APPLICANTS: WARNING: Any person who knowingly, and with intent to injure, defraud or deceive any insurer, makes any claim for the proceeds of an insurance policy containing any false, incomplete or misleading information is guilty of a felony. OREGON APPLICANTS: Any person who knowingly and with the intent to defraud any insurance company or other person, files an application for insurance containing any false information, or conceals for the purpose of misleading, information concerning any fact material thereto, may be guilty and subject to prosecution for insurance fraud. PENNSYLVANIA APPLICANTS: Any person who knowingly and with intent to defraud any insurance company or other person files an application for insurance or statement of claim containing any materially false information or conceals for the purpose of misleading, information concerning any fact material thereto commits a fraudulent insurance act, which is a crime and subjects such person to criminal and civil penalties. VERMONT APPLICANTS: Any person who knowingly presents a false statement in an application for insurance may be guilty of a criminal offense and subject to penalties under state law. THE COMPLETION OF THIS APPLICATION OR THE ATTACHED SUPPLEMENTS, OR TENDERING OF PREMIUM DOES NOT BIND COVERAGE. THIS APPLICATION IS SUBJECT TO THE UNDERWRITING RULES OF THE INSURANCE COMPANY. 7
Toll-free number: 1-66-434-557 SIGNATURE The undersigned proprietor, authorized partner of the partnership, or authorized stockholder of the corporation represents that the following statements are understood and agreed to by the applicant: By signing this application, the undersigned represents that he or she has made inquiries of all Firm members as appropriate and that all Firm members are bound by the representations made on this application, any supplemental application, and any supplemental data and documents provided. Signing this application or tendering premium does not bind the applicant or the company to issue insurance coverage, but it is agreed that this application shall be the basis of the contract should a policy be produced. After inquiry of all stockholders, partners and employees, the undersigned is not currently aware of any act, error, omission, incident, circumstance, dispute, fee dispute or employee problem, which could reasonably be expected to be the basis of a claim being made against the Firm, its predecessors or any partner, stockholder or employee, that has not been reported to another insurer. It is understood and agreed that any claim emanating from such knowledge or information shall be excluded from coverage under the proposed policy. IMPORTANT: The Company intends to rely upon your answers to questions in this application and any attached supplements in reaching its decision to offer coverage and/or to offer coverage excluding any described activities. Inaccurate responses to inquiries may result in a loss of coverage for activities and/or a decision by LIU to rescind the entire policy. Your signature below acknowledges your understanding of this notice. Must be signed by a person who has the authority to sign on behalf of and to bind the Applicant, all firms and individuals requesting insurance through this application. Signature of Applicant Title Date Print Name: Agent, broker or producer of this application for coverage (if applicable): Name: (Please Print) Company: Signature: Date: