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Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report: August 1, 1998
(Date of earliest event reported)
Central Reserve Life Corporation
(Exact Name of Registrant as specified in its charter)
Ohio 0-8483 34-1017531
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(State or other jurisdiction (Commission File (IRS Employer
of Incorporation) Number) Identification Number)
17800 Royalton Road, Strongsville, Ohio 44136
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(Address of Principal Executive Offices) (Zip Code)
(440) 572-2400
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(Registrant's telephone number, including area code)
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Item 5. Other Events.
On August 1, 1998, Central Reserve Life Insurance Company ("Central"),
a wholly- owned subsidiary of the Company, entered into an agreement with United
Benefit Life Insurance Company ("UBL") to reinsure 100% of the major medical
policies of UBL, covering approximately 100,000 lives with estimated annual
premiums of $100 million. Concurrently, Central ceded 80% of the business to
Reassurance Company of Hannover ("Hannover"), thereby assuming a net risk of
20%. Reserves for estimated claims of $36,500,000 were assumed by Central for
which UBL transferred assets of $16,500,000, net of a $20,000,000 ceding
allowance provided by Central. Central received a $20,000,000 ceding allowance
from Hannover for the 80% thereby creating a zero effect on statutory surplus
regarding the allowances. The agreement also provides Central with access to
UBL's current sales force.
Reference is made to the News Release attached as Exhibit 99.1 hereto.
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Item 7. Financial Statements and Exhibits.
(c) Exhibits
99.1 Press Release dated August 3, 1998
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: September 14, 1998 CENTRAL RESERVE LIFE CORPORATION
By: /s/ Frank W. Grimone
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Chief Financial Officer
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EXHIBITS
Exhibit No. Exhibit
99.1 Press Release dated August 3, 1998
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CENTRAL RESERVE LIFE CORPORATION
17800 ROYALTON ROAD
STRONGSVILLE, OHIO 44136
WWW.CENTRALRESERVE.COM
NASDAQ: CRLC
AT THE COMPANY: AT THE FINANCIAL RELATIONS BOARD:
Gayle Vixler Mike Arneth Janine Warrell
First Vice President General Information Analyst Inquiries
(440) 572-2400 (312)640-6734 (312)640-6775
Margie Baigh
Media Inquiries
(312) 640-6690
FOR IMMEDIATE RELEASE
MONDAY, AUGUST 3, 1998
CENTRAL RESERVE LIFE COMPLETES ACQUISITION
OF UNITED BENEFIT LIFE HEALTH INSURANCE BUSINESS
STRONGSVILLE, OHIO, AUGUST 3, 1998 -- CENTRAL RESERVE LIFE INSURANCE COMPANY
(CRL), a subsidiary of CENTRAL RESERVE LIFE CORPORATION (NASDAQ: CRLC),
announced completion of its transaction to acquire through reinsurance all of
the health insurance business of United Benefit Life Insurance Company, a
subsidiary of privately-held United Benefit Managed Care Corp. (UBMCC), based in
Fort Worth, Texas.
The transaction, effective August 1, affects a block of business which primarily
includes major medical type policies sold to individuals and small businesses.
In addition, the agreement also provides CRL with access to United Benefit
Life's current sales force through an agency agreement with Insurance Advisors
of America, Inc. (IAAI), another subsidiary of UBMCC.
The United Benefit Life block of business presently generates approximately $100
million in annual premium revenue. The addition of this block will increase
CRL's annual premium revenue by 50 percent to over $350 million. Through a
quota-share reinsurance agreement, approximately 100,000 United Benefit Life
covered lives are assured of continued coverage, and all terms and conditions of
their policies will be honored by CRL.
Central Reserve Life Corporation, through its Ohio-domiciled life insurance
company, specializes in meeting the insurance needs of individuals and small to
mid-sized businesses with accident and health insurance and short-term major
medical insurance.
VISIT ON THE WORLDWIDE WEB AT WWW.CENTRALRESERVE.COM
FOR MORE INFORMATION ABOUT CENTRAL RESERVE LIFE
CORPORATION TOLL-FREE VIA FAX, DIAL
1-800-PRO-INFO ENTER COMPANY CODE "CRLC"
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