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Gi STPAUL <br />ri TRAVELERS <br />IMPORTANT DISCLOSURE NOTICE OF TERRORISM <br />INSURANCE COVERAGE <br />On November 26, 2002, President Bush signed into law the <br />Terrorism Risk Insurance Act of 2002 (the ".Act"). The Act <br />establishes a short-term program under which the Federal <br />Government will share in the payment of covered losses caused <br />by certain acts of international terrorism. We are providing you <br />with this notice to inform you of the key features of the Act, and to <br />let you know what effect, if any, the Act will have on your premium. <br />Under the Act, insurers are required to provide coverage for <br />certain losses caused by international acts of terrorism as defined <br />in the Act. The Act further provides that the Federal Government <br />will pay a share of such losses. Specifically, the Federal <br />Government will pay 90% of the amount of covered losses caused <br />by certain acts of terrorism which is ir, excess of an insurer's <br />statutorily established deductible for that year. The Act also caps <br />the amount of terrorism -related losses for which the Federal <br />Government or an insurer can be responsible at <br />$100,000,000,000.00, provided that the insurer has met its <br />deductible. <br />Please note that passage of the Act does not result in any change <br />in coverage under the attached policy or bond (or the policy or <br />bond being quoted). Please also note that no separate additional <br />premium charge has been made for the terrorism coverage <br />required by the Act. The premium charge that is allocable to such <br />coverage is inseparable from and imbedded in your overall <br />premium, and is no more than one percent of your premium. <br />ILT-1018 (9/04) <br />j5 <br />