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TERRA <br /> I INSURANCE COMPANY <br /> May 15,2015 <br /> Re: Terra Insurance Company A.M. Best Rating <br /> To whom it may concern: • <br /> Terra's A.M. Best rating is"A"with a size category of"V". However,based on its credit <br /> adequacy score,Terra actually has an imputed rating of"A++". Furthermore,Terra is <br /> reinsured by Everest Reinsurance Company,which is rated"A+", Class"XV",by A.M. Best. <br /> We believe that our"A"rating from Best,combined with our score on A.M Best's Capital <br /> Adequacy Ratio analysis("BCAR") and the nature of our reinsurance should satisfy any <br /> concern about Terra as an insurer. <br /> • <br /> Added Strength of Terra's Qualitative Best Rating and BCAR . <br /> The Best rating system expresses A.M.Best&Company's opinion of an insurer's financial <br /> strength and ability to meet its ongoing obligations to policyholders. According to A.M.Best: <br /> "An insurer with an."A"rating is one that has on balance, excellent <br /> balance sheet strength,operating performance and business profile. <br /> These companies have a strong ability to meet their ongoing bligations <br /> to policyholders". <br /> As recently as last month,analysts from A.M.Best informed Terra's management that <br /> according to A.M.Best's traditional analysis—and its Best's Capital Adequacy Ratio(BCAR) <br /> analysis—Terra has an implied rating of"A-H-"(Superior). In other words, if rated by A.M. <br /> Best—without regard to surplus amount or number of lines of business—Terra would achieve <br /> an"A++"rating.An"A++"qualitative rating designation indicates that A.M.Best opines that <br /> an insurer has a"superior ability to meet their ongoing insurance obligations." <br /> Terra is the highest rated professional liability insurer of design professionals in the United <br /> States,according to its consistently stratospheric score on Best's BCAR analysis. BCAR is the <br /> only true qualitative measure of an insurance company's strength,reliability and ability to <br /> meet its financial obligations.BCAR analyzes an insurance company's underwriting, credit <br /> and investment risks.Insurance companies in the Best rating system are assigned a score <br /> pursuant to the BCAR analysis. <br /> A.M.Best recently confirmed that for 2013,Terra's BCAR score has risen to 618 (from its <br /> present level of 595.8) and is shown as such in Best's current 2013 rating guide. By contrast, <br /> no other carrier comes anywhere close to Terra according to Best's BCAR analysis. For <br /> instance,the following shows competing carriers' BCAR scores,pursuant to Best's 2012 <br /> rating guide,rounded to the nearest whole number: <br /> • Terra: 618 <br /> {00115239.DOC; 1} <br /> 131 <br /> 2 Fifer Avenue,Suite ioo i Corte Madera,CA 94925 /Tel 425.927.2902! 800.872.0077 / Fax 425.927.32o4 <br />