AAIS Product Advisory - August 29, 2003

Certified Terrorism Rating Information -- Topic of Discussion With California Insurance Department

On February 5, 2003, AAIS submitted the rating information that is shown for California on our open web site at http://www.aaisonline.com/terrorism/CA.html. The rating information filing was made on a "file-and-use" basis in accordance with the guidelines of the Terrorism Risk Insurance Act of 2002 and California's Bulletin, 2002-9.

At this time, the AAIS rating information has not been formally disapproved by the California Department of Insurance. However, due to the fact that the Department has also not formally approved the rating information, some of our affiliates have experienced difficulty when trying to adopt the AAIS rating factors.

Given the company action requirements for adopting advisory organization rating information filings in this state, affiliated companies may wish to suspend efforts to adopt the AAIS terrorism rating information in California until we have obtained a formal approval.

We will advise companies, via Product Advisory and web site postings, of the ultimate outcome of our deliberations with the Insurance Department and of any amendments that are subsequently made to the rating information that is currently posted.

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