A-13-034_Claims_Management.pdf

SEE ADDENDUMIS CHECKED

CODE 18a. PAYMENT WILL BE MADE BY

CODE

FACILITYCODE

17b. CHECK IF REMITTANCE IS DIFFERENT AND PUT SUCH ADDRESS IN OFFER

OFFEROR

TDP-IRS

OXON HILL MD 20745

SUITE 500

6009 OXON HILL ROAD

INTERNAL REVENUE SERVICE

CODE 16. ADMINISTERED BYCODE

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SIZE STANDARD:

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10. THIS ACQUISITION ISCODE

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14. METHOD OF SOLICITATION

13b. RATING

NAICS:

SMALL BUSINESS

09/03/2013 1400 ETSHEKETIA NETTLES

(No collect calls)

INFORMATION CALL:

FOR SOLICITATION 8. OFFER DUE DATE/LOCAL TIMEb. TELEPHONE NUMBER a. NAME

4. ORDER NUMBER3. AWARD/ 6. SOLICITATION

A13034

5. SOLICITATION NUMBER

SOLICITATION/CONTRACT/ORDER FOR COMMERCIAL ITEMS 1. REQUISITION NUMBER PAGE OF

1 2 OFFEROR TO COMPLETE BLOCKS 12, 17, 23, 24, & 30

TELEPHONE NO.

17a. CONTRACTOR/

15. DELIVER TO

OXON HILL MD 20745

SUITE 500

6009 OXON HILL ROAD

9. ISSUED BY

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2. CONTRACT NO.

EFFECTIVE DATE

$7.0

18b. SUBMIT INVOICES TO ADDRESS SHOWN IN BLOCK 18a UNLESS BLOCK BELOW

ISSUE DATE

DELIVERY FOR FOB DESTINA-

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11.

SEE SCHEDULE

12. DISCOUNT TERMS

THIS CONTRACT IS A

RATED ORDER UNDER

DPAS (15 CFR 700)

13a.

SERVICE-DISABLED

VETERAN-OWNED

SMALL BUSINESS

HUBZONE SMALL

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8(A)

INTERNAL REVENUE SERVICE

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24.

AMOUNT

23.

UNIT PRICE

22.

UNIT

21.

QUANTITY

20.

SCHEDULE OF SUPPLIES/SERVICES

19.

ITEM NO.

Period of Performance: 05/01/2014 to 12/31/2014

0001 Transition Period Period of Performance: 01/01/2014 to 05/31/2014

0002 Base Period Period of Performance: 06/01/2014 to 12/31/2014

0003 Option Period 1 Period of Performance: 01/01/2015 to 12/31/2015 Continued ...

(Use Reverse and/or Attach Additional Sheets as Necessary)

HEREIN, IS ACCEPTED AS TO ITEMS:

X

XX

DATED

SHEKETIA M. NETTLES

. YOUR OFFER ON SOLICITATION (BLOCK 5),

INCLUDING ANY ADDITIONS OR CHANGES WHICH ARE SET FORTH

COPIES TO ISSUING OFFICE. CONTRACTOR AGREES TO FURNISH AND DELIVER

ARE

ARE

31c. DATE SIGNED

27b. CONTRACT/PURCHASE ORDER INCORPORATES BY REFERENCE FAR 52.212-4. FAR 52.212-5 IS ATTACHED. ADDENDA

31a. UNITED STATES OF AMERICA (SIGNATURE OF CONTRACTING OFFICER)

30c. DATE SIGNED 31b. NAME OF CONTRACTING OFFICER (Type or print)

ALL ITEMS SET FORTH OR OTHERWISE IDENTIFIED ABOVE AND ON ANY ADDITIONAL

SHEETS SUBJECT TO THE TERMS AND CONDITIONS SPECIFIED.

27a. SOLICITATION INCORPORATES BY REFERENCE FAR 52.212-1, 52.212-4. FAR 52.212-3 AND 52.212-5 ARE ATTACHED. ADDENDA

26. TOTAL AWARD AMOUNT (For Govt. Use Only)

OFFER

STANDARD FORM 1449 (REV. 2/2012)

Prescribed by GSA - FAR (48 CFR) 53.212

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AUTHORIZED FOR LOCAL REPRODUCTION

PREVIOUS EDITION IS NOT USABLE

30b. NAME AND TITLE OF SIGNER (Type or print)

30a. SIGNATURE OF OFFEROR/CONTRACTOR

28. CONTRACTOR IS REQUIRED TO SIGN THIS DOCUMENT AND RETURN

25. ACCOUNTING AND APPROPRIATION DATA

29. AWARD OF CONTRACT: REF.

32e. MAILING ADDRESS OF AUTHORIZED GOVERNMENT REPRESENTATIVE

32c. DATE 32b. SIGNATURE OF AUTHORIZED GOVERNMENT REPRESENTATIVE

ACCEPTED, AND CONFORMS TO THE CONTRACT, EXCEPT AS NOTED:

32a. QUANTITY IN COLUMN 21 HAS BEEN

RECEIVED INSPECTED

40. PAID BY39. S/R VOUCHER NUMBER38. S/R ACCOUNT NUMBER

37. CHECK NUMBER

FINALPARTIAL

36. PAYMENT

FINALPARTIAL

35. AMOUNT VERIFIED

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34. VOUCHER NUMBER33. SHIP NUMBER

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32g. E-MAIL OF AUTHORIZED GOVERNMENT REPRESENTATIVE

42d. TOTAL CONTAINERS42c. DATE REC'D (YY/MM/DD)

42b. RECEIVED AT (Location)

42a. RECEIVED BY (Print)

41c. DATE41b. SIGNATURE AND TITLE OF CERTIFYING OFFICER

41a. I CERTIFY THIS ACCOUNT IS CORRECT AND PROPER FOR PAYMENT

STANDARD FORM 1449 (REV. 2/2012) BACK

24.

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23.

UNIT PRICE

22.

UNIT

21.

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20.

SCHEDULE OF SUPPLIES/SERVICES

19.

ITEM NO.

0004 Option Period 2

Period of Performance: 01/01/2016 to 12/31/2016

0005 Option Period 3

Period of Performance: 01/01/2017 to 12/31/2017

0006 Option Period 4 EA

Period of Performance: 01/01/2018 to 11/30/2018

32f. TELEPHONE NUMBER OF AUTHORIZED GOVERNMENT REPRESENTATIVE

32d. PRINTED NAME AND TITLE OF AUTHORIZED GOVERNMENT REPRESENTATIVE

2 2 of

Solicitation A-13-034

TABLE OF CONTENTS

PART 1: PRICING

Supplies or Services & Prices or Costs

PART 2: IDIQ PERFORMANCE WORK STATEMENT

PART 3: CONTRACT CLAUSES

Packaging and Marking

Inspection and Acceptance

Deliveries or Performance

Contract Administration Data

Special Contract Requirements

PART 4: OTHER TERMS, CONDITIONS, REPRESENTATIONS & CERTIFICATIONS

PART 5: PROPOSAL INSTRUCTIONS AND EVALUATION METHODS

PART 6: ATTACHMENTS

PART 1: PRICING

SUPPLIES OR SERVICES & PRICES OR COSTS

1.0 FAR 52.216-1 TYPE OF CONTRACT (APR 1984)

a) This is an Indefinite-Delivery/Indefinite-Quantity (IDIQ) contract, as identified under

Federal Acquisition Regulation (FAR) 16.504. Requirements will be placed under this contract through Firm-Fixed-Price (FFP), and/or Labor-Hour (LH) task orders issued against the basic contract. Task order awards shall be as follows:

1) Total minimum quantity of service to be awarded to the contractor during the life-cycle of this contract shall be $300,000. Treasury will ensure the contractor will, at a minimum, receive task order awards, the sum of which will meet the IDIQ minimum.

2) Total maximum quantity of services to be awarded during the life-cycle of this contract shall be $15,000,000.

b) The Contractor shall, in accordance with the terms and conditions set forth hereafter, furnish the necessary qualified personnel, services, travel, facilities, and materials (except those specifically to be provided by the Government) and to do all things necessary and incident to the completion of the contractual effort in accordance with the Performance Work Statement

(PWS).

2.0 TASK ORDERS

Task orders awarded pursuant to this contract will be Firm-Fixed Price, Labor Hour or any combination thereof as specified in the individual task order.

3.0 TASK ORDERS FUNDING

Task orders issued under the contract may be subject to full or incremental funding. Firm-fixed-price task orders will be fully funded. The labor-hour task orders may be incrementally funded.

4.0 PRICING INSTRUCTIONS

When responding to an actual task under the IDIQ basic contract, the Contractor shall use the proposed rates/prices from Attachment 4, and the Contractor may not exceed these rates/prices during contract performance. The Contractor shall indicate in its proposal the extent to which its proposed labor rates represent a discount from the firm’s standard rates.

5.0 CONTRACT PRICING

All task orders issued for services to be performed within the United States will be priced in accordance with the hourly rates and fixed prices set forth in Attachment 4. The fully burdened hourly rates are ceiling price rates and the Contractor may, at its discretion or at the request of the Government, elect to propose lower hourly rates for individual task orders.

Attachment 4 represents fully-burdened hourly rates for each labor category. The fully-burdened labor rates include all direct labor, indirect applicable rates in accordance with each contractor’s normal accounting practice, and profit associated with providing the required skill.

PART 2: IDIQ PERFORMANCE WORK STATEMENT

TERRORISM RISK INSURANCE PROGRAM (TRIP) CLAIMS MANAGEMENT

SUPPORT SERVICES

United States Department of Treasury

Internal Revenue Service

Treasury Executive Office for Asset Forfeiture

LIST OF ACRONYMS

The acronyms listed below will be used when referring to the corresponding terms:

TRIP Terrorism Risk Insurance Program

TRIA Terrorism Risk Insurance Act

DEP Direct Earned Premium

GAAP General Accepted Accounting Principles

COR Contracting Officers Representative

OIG Office of Inspector General

CFR Code of Federal Regulations

1.0 INTRODUCTION

On November 26, 2002, the President signed into law the Terrorism Insurance Act of 2002 (Pub.

L. 107-297, 116 STAT. 2322). The Act was effective immediately. The Act’s purposes are to address market disruption, ensure the continued widespread availability and affordability of commercial property and casualty insurance for terrorism risk, and to allow for a transition period for the private markets to stabilize and build capacity while preserving state insurance regulation and consumer protections.

In managing the Program authorized by TRIA, Treasury is guided by several goals. First, Treasury has implemented the Act in a transparent and effective manner that treats comparably those insurers required to participate in the Program and provides necessary information to policyholders in a useful and efficient manner. Second, in accordance with the Act’s stated purposes, Treasury will rely as much as possible on the State insurance regulatory structure.

Treasury has coordinated the implementation of all aspects of the Program with the National

Association of Insurance Commissioners (NAIC). Third, to the extent possible within statutory constraints, Treasury allows insurers to participate in the Program in a manner consistent with procedures used in their normal course of business. Finally, Treasury is guided by the Act’s goal for insurers to develop their own capacity, resources, and mechanisms for terrorism insurance coverage when the Program expires.

The Department of the Treasury seeks to procure support for its Terrorism Risk Insurance

Program (“Program”). The contractor shall have the expertise in and knowledge of commercial claims insurance and reinsurance needed to develop a data system that supports the requirements of the Program. The contractor shall use the requirements of the Act and affiliated regulations in developing a tested and documented operating system that will be maintained in readiness throughout the period of the contract. Should a certified act of terrorism occur during the term of the contract triggering activation of the reimbursement conditions of the Program, the contractor shall be able to estimate the scope of losses from such event, process requests from insurers/insurer groups for reimbursement of the federal share, reconcile payments authorized by

Treasury and provide other statistical reports requested by Treasury. The contractor shall be the main point of contact for operational questions from insurers regarding the Program.

2.0 SCOPE

The Contractor shall furnish a web-based system for the receipt and exchange of information with the Treasury, participating insurers and any other TRIP contractors using employees trained in insurance, reinsurance and the functioning of the TRIP. The Contractor shall provide the means for secure, web based access and information exchanges with the Treasury and Treasury’s contractors. The Contractor shall assure that any systems and interfaces with the Treasury and

Treasury’s contractors provide security for the information transmitted and ensure that the business sensitive, proprietary and personal information received and generated is suitably protected.

3.0 CLAIMS MANAGEMENT REQUIREMENT

The contract calls for adapting or establishing a facility for the receipt of Initial Notices of

Insured Loss and Certifications of Loss from insurers following certification of an act of terrorism, and for review of Certifications, processing and the reconciliation of payments made by Treasury to insurers. Following certification of an act of terrorism and within 7 business days of receiving a task order, the Claims Management Contractor shall activate the TRIP claims management facility with necessary core staff, systems, and equipment in place and be able to begin processing of insurer claims.

The Contractor shall make the record of Notices of Insured Loss and Certifications of Loss available to Treasury and the Trip Audit contractor for review.

The Contractor shall develop with Treasury a plan for closer examination of selected claims files underlying insurers’ requests for payment. Such reviews shall include compliance with the Act and regulations, proper investigation and processing, reasonableness of any litigation settlement not previously approved by the Government, and the reasonableness of claim payments and allocated loss adjustment expenses.

The Contractor shall obtain additional information from insurers as needed. The Contractor will participate in examining claims files both prior to and following reimbursement to the insurer.

The Claims Management Contractor shall provide space and support and shall cooperate with

Treasury auditors, or independent auditors engaged by Treasury for the conduct of reviews, financial and other audits of the Program. The Contractor shall provide similar support to the TRIP

Audit contractor in any review of the facility and as it conducts the planned program of reviewing or

“auditing” reimbursement requests and files.

The Contractor shall comply with Program regulations, Subpart G – Audit and Investigative

Procedures, Section 50.60, Audit Authority.

3.1 TRIP AUDIT CONTRACT

The Claims Management Contractor will work with the TRIP Audit Contractor prior to and following any Program activation. The TRIP Audit Contractor assists in ensuring adherence to the requirements of the TRIA, compliance with the regulations issued pursuant to the Act, and to promote the operating efficiency and financial integrity of TRIP. The TRIP Audit Contractor reviews concepts and documentation, analyzes operational alternatives, participates in systems testing and, as appropriate, e.g., upon activation would: (a) audit the procedures used by the Claims

Management Contractor for accuracy; review or audit insurer submissions, as required; (b) work to ensure an avoidance of conflicts of interest in processing; and (c) coordinate with and complement the work of the Department of the Treasury’s Office of the Inspector General, their authorized independent financial statement auditor or other authorized audit or investigative entities. It is anticipated that a new TRIP Audit Contract will be in place concurrently with a new Claims

Management Contract.

4.0 APPLICABLE DOCUMENTS

4.1 LEGISLATION

Documents needed to accomplish the tasks described below include: the Terrorism Risk

Insurance Act of 2002, as amended. (see Exhibit 1)

4.2 REGULATIONS

Treasury regulations establishing general provisions implementing the Program, including key definitions, and requirements for policy disclosures and mandatory availability, can be found in

Subparts A, B, and C of 31 CFR Part 50. Treasury’s rules applying provisions of the Act to State residual market insurance entities and State workers’ compensation funds are at Subpart D of 31

CFR Part 50. Rules setting forth procedures for filing claims for payment of the Federal share of compensation for insured losses are at Subpart F of 31 CFR Part 50. Subpart G of 31 CFR Part

50 contains rules on audit and recordkeeping requirements for insurers. Subpart H to Part 50 addresses the recoupment of the Federal Share of Compensation while Subpart I of 31 CFR Part

50 contains Treasury’s rules implementing the litigation management provisions of section 107 of the Act. Subpart J to part 50, comprises Treasury's regulations implementing the annual cap on insured losses of $100 billion and the pro rata payment of claims. Treasury plans adding a new subpart to address final netting and the commutation of claims payments.

4.3 INTERIM GUIDANCE

To assist insurers, policyholders, and other interested parties in complying with immediately applicable requirements of the Act prior to the issuance of regulations, Treasury issued interim guidance. Treasury has also issued interim final rules prior to the issuance of final regulations

(31 CFR Part 50). These documents may be found on the Treasury web site at:

http://www.treasury.gov/resource-center/fin-mkts/Pages/program.aspx

4.4 INTERPRETIVE LETTERS

The Terrorism Risk Insurance Program (TRIP) Office has responded to individual requests for interpretations of the Terrorism Risk Insurance Act (TRIA) from various parties seeking guidance on how the Act may affect their individual circumstances. In 31 C.F.R. § 50.9, Treasury provided a procedure for requesting TRIA interpretations and noted that responses by the TRIP Office would be made publicly available. The responses to requests for interpretation have been issued by the TRIP Office and are available on the Treasury web site at:

5.0 TECHNICAL REQUIREMENTS

5.1. TRANSITION OR PREPARE AND TEST CLAIMS MANAGEMENT FACILITY

(TASK 1)

5.1.1 The Contractor shall provide the draft transition plan in accordance with the Section 7 of

Part 3, Deliverables and Performance of the solicitation. The Contractor shall provide personnel possessing the appropriate qualifications, skill sets and experience and do all things necessary for the successful performance of the work. The Contractor shall perform the work described herein to successfully complete the activities necessary to establish, test and have ready the successor

TRIP Claims Management Facility and, as necessary, assume the existing work performed under the current Contract. The facility shall be in place, tested and operationally capable within 90 calendar days after issuance of a task in accordance with Technical Exhibit 2 of the PWS. The

Contractor shall complete the transition of all work and responsibilities of the incumbent contractor within 150 days after issuance of the task in accordance with Part 5 of the solicitation and Exhibit 2 of the PWS. During this start-up period, the Contractor shall report its progress and any problems on a weekly basis.

5.2 PERIODIC REVIEW AND READINESS TESTING - SYSTEM CERTIFICATION

AND ACCREDITATION

5.2.1. After initial “acceptance” testing of the operation, the Contractor shall regularly test and report on the operational readiness of the facility. Testing shall typically be planned and performed with the Contractor, TRIP Audit contractor and Treasury staff participation. Testing may also involve one or more volunteer insurance companies and include the receipt of company generated data. Testing shall be coordinated with the testing of Statistical Agent Capability (see paragraph 5.6, task 6). Test reports shall be due 7 business days after test completion. Test report findings shall be presented to Treasury and follow up activities shall be agreed upon with

Treasury. Tests shall be conducted no more than every four months during the base period of the contract no more than every four months in subsequent Option Years.

i. Deficiencies found as a result of periodic testing shall be corrected by the contractor. (If testing determines that system enhancements are required, e.g., to improve user friendliness, these will be addressed via requirements issued pursuant to task 3.)

5.2.2. The Contractor shall over the term of the Contract undertake all activities required to secure and/or maintain the Security Assessment and Authorization of the TRIP Claims

Management System and the Statistical Agent System (See tasks 6 and 7). This shall include, but not be limited to cooperation with Treasury and/or third-party evaluators and the collaborative development, for Treasury review and approval, of information security documentation and assessments identified in Exhibit 4 of the solicitation.

5.2.3. Notwithstanding the requirements of 5.2.2, the Contractor shall fully test contingency plans and disaster recovery procedures that ensure continuity of operation in the event that the primary systems and locations are inoperable. (Note, the primary operating site and a remote backup site(s) must be within the Continental United States.) Test results shall be delivered within 7 business days after completion of testing and shall be accompanied by a complete set of all procedures and a complete, current set of all systems documentation, systems generated and other reports.

5.2.4. The Contractor shall at least annually during each year, including each Option Year, participate in a “critical Program review” with Treasury. This review will be conducted at the

Treasury Department in Washington and is intended to ensure Contractor plans and activities are coordinated with various Treasury offices and the other TRIP contractors.

5.3 EXPERT AND ANALYTICAL SUPPORT (TASK 3)

5.3.1. The Contractor shall furnish knowledgeable and experienced staff to research, analyze and make recommendations concerning the conduct of the Program. The staff shall respond to

Treasury requests for information and assistance in its efforts to coordinate TRIP activities with insurers, reinsurers, state regulators, Program advisory bodies and others. (Past assignments under this task included an actuarial study of probable maximum losses under a scenario.)

5.3.2. The Contractor shall provide assistance to Treasury with certifications of acts of terrorism including to loss data collection or consolidation and performing analyses of thresholds, deductibles, repeat loss areas, and other specific areas related to certifications of acts of terrorism.

5.3.2.1. The Contractor, following certification of an act of terrorism, shall assist the Treasury with data collection and development for publication of an estimate of aggregate insured losses which shall be used as the basis for determining whether mandatory recoupment will be required.

The Contractor also shall, as required, assist in updating the estimate.

5.3.2.2. The Contractor shall assist the Treasury with data collection and development of an initial notice to Congress [due not later than 15 days after the date of an act of terrorism], stating whether the Secretary estimates that aggregate insured losses will exceed $100,000,000,000.

5.3.3. The Contractor shall provide expert policy analyses, technical advice, and support to the

Treasury particularly in the areas of claims and accounting as they relate to property insurance and reinsurance industry practices.

5.3.4. The Contractor shall perform, the required management analyses including identification of problems, or potential problems, development of forms and screens, manuals and other materials, providing input to guidance documents, correspondence, interpretative letters and regulations.

5.3.5. The Contractor shall develop data, answer specific questions posed by Treasury; frame operational or policy issues for resolution by the Treasury; provide high level technical support for writing and developing Technical Assistance Bulletins, Policy Issuance Bulletins, Issues

(White) Papers; and draft responses to TRIP constituent concerns on behalf of Treasury.

5.3.6. The Contractor shall develop, review or update all necessary materials including systems analysis, systems changes, forms, other program guides and manuals, memoranda, procedures and documentation for implementing legislative and rule changes. The Contractor shall coordinate with the COR during the execution of these tasks.

5.3.7. The Contractor shall provide ad hoc analyses when tasked by the COR in support of the operational assessment aspects of the TRIP and budgeting, planning, and evaluation of the TRIP.

5.3.8. The contractor shall perform fault and problem management. In addition to effectively and efficiently addressing individual problems and faults, the contractor shall identify chronic issues, trends, or security risks. Upon determination and validation of such chronic conditions, the Contractor shall prepare a root cause analysis and a work proposal for remediation action.

5.4 ACTIVATION AND ONGOING OPERATION OF THE FACILITY

(TASK 4)

Following certification of an act of terrorism and within 10 calendar days after Contracting

Officer issuance of Task 4, the Contractor shall activate the TRIP claims management facility with necessary core staff, systems, and equipment in place. The Contractor shall respond to insurer inquiries and begin processing insurer claims. The Contractor shall ensure that all systems are available at least 99% of business hours and that no disruption in systems availability or operations exceeds 72 hours for the term of the Task.

5.4.1. REVIEW OF INSURERS’ NOTICES AND CERTIFICATIONS

The Contractor shall receive, review and record Certifications from the insurers as required by the Act and Subpart F of the Program regulations. This shall include the Initial Notice of Insured

Loss, Certifications of Loss [Initial and Supplementary] as well as any accompanying detailed information, i.e., certifications, schedules and bordereaux, reports and any related correspondence. See http://www.treasury.gov/resource-center/fin-mkts/Pages/claims_process.aspx

The Contractor shall establish and implement work flows and controls, with supporting records and documentation, for the controlled receipt (electronic and conventional) and processing of

Certifications and for the preparation of electronic payment “vouchers” for Treasury approval to ensure all payments are accurately processed against the Certifications, accounted for and dispatched by Treasury to the proper recipients.

5.4.1.1. INITIAL NOTICE OF INSURED LOSS

5.4.1.1.1. The Initial Notice of Insured Loss shall be submitted by insurers and include an initial estimate of aggregate losses for the Program Year, the amount of the insurer deductible and an estimate of the Federal Share of compensation for the insurer’s aggregate insured losses. Such notices must also include other necessary information e.g., insurer name and identification of all affiliates, to allow for subsequent processing of insurer requests for payment. (In order to facilitate processing of payment requests, insurers may, at their option, submit with the Initial

Notice of Insured Loss the Schedule A, Declaration of “Direct Earned Premium” and

Calculation of “Insurer Deductible” Under Terrorism Risk Insurance Act of 2002 (TRIA), as amended.)

5.4.1.1.2. Upon receipt of the Initial Notice of Insured Loss, directly or from Treasury, the

Contractor shall log the receipt and review the Initial Notice of Loss for completeness, accuracy and consistency with reference materials, e.g., A.M. Best reports. The Contractor, within two business days, shall make contact with the insurer to confirm processes, estimate time frames for receipt of the Certification(s) of Loss, resolve questions, and to otherwise facilitate the processing of the expected Certification(s) of Loss.

5.4.1.1.3. The Contractor shall make the record of its reviews available to Treasury for use in reviews of selected Initial Notices of Loss information by Treasury or by the TRIP Audit contractor.

5.4.1.2. CERTIFICATIONS OF LOSS [INITIAL AND SUPPLEMENTARY]

The Contractor shall review Certifications of Loss [Initial and Supplementary] and accompanying schedules: Schedule A, Declaration of Direct Earned Premium and Insurer

Deductible; Schedule B, Certification of Compliance; and, Schedule C, Loss Bordereau. The

Certifications and schedules shall be received electronically, or conventionally, if required. The

Contractor shall log and review the insurer submissions for consistency with the Initial Notices of Loss, adherence to the Act and regulations and examine for accuracy, internal and month to month consistency and for possible misstatements or miscalculations. Further, the Contractor shall review Schedule A, for completeness, accuracy and consistency against reference materials, e.g., A.M. Best reports. The Contractor’s review shall also specifically include the requirements of 5.4.1.2.1 through 5.4.1.2.3, which follow.

5.4.1.2.1. The Contractor’s reviews of the [Initial and Supplementary] Certifications of Loss, schedules and any supporting documentation received, shall confirm that the insurer requested

Federal Share of compensation for insured losses under the Program is consistent with the Act and regulations and does not include compensation for ineligible items, e.g., punitive damages;

amounts that the insurer offset through salvage, subrogation, or other recovery; and, amounts the insurer or its insured receives as compensation for an insured loss from another Federal program..

5.4.1.2.2. The Contractor shall review the schedules, supporting documentation, and separately submitted information regarding underlying claims. The Contractor shall identify and summarize those selected underlying claims that, in keeping with the Treasury TRIP

Regulations, Subpart I of 31 CFR Part 50, are above certain threshold dollar amounts and meet other certain criteria to require prior Federal Government approval of certain proposed settlements. The Contractor’s claims management processes shall confirm that, when required, Treasury approvals have been given prior to the processing payment requests to Treasury.

5.4.1.2.3. The contractor shall establish systems and procedures for reviewing and evaluating the appropriateness of the proposed settlements submitted pursuant to the regulatory requirements of 31 CFR Part 50.82 (as in effect July 28, 2004 and codified by the Terrorism Risk

Insurance Extension Act of 2005), which requires advance approval by Treasury of proposed settlements of certain causes of action involving insured losses under the Program.

5.4.1.2.4. The Contractor’s reviews of the [Initial and Supplementary] Certifications of Loss also shall be done to make certain that an insurer’s recoveries for losses incurred in any Program

Year, from the Federal Share of compensation and other sources, shall not be greater than the aggregate of the insurer’s insured losses for acts of terrorism in that Program Year. Amounts recovered by an insurer in excess of its aggregate insured losses in a Program Year are required to be returned to Treasury within 45 days after the end of the month when such excess recoveries are received by the insurer. The amounts returned exclude such amounts that the insurer has recovered from a reinsurer pursuant to an agreement whereby the reinsurer’s rights take precedence over the obligation of the insurer to repay excess recoveries to Treasury. Any amounts shall be due Treasury within 45 days or amounts may be offset against subsequent claims.

5.4.1.2.5. The Contractor shall complete, within 10 business days of receipt, the review of

[Initial and Supplementary] Certifications of Loss and supporting documentation. The

Contractor, within 10 business days of receipt of a [Initial or Supplementary] Certification of

Loss that is incomplete, in error or otherwise a problem, shall resolve with the insurer any such problems arising from their review of the [Initial and Supplementary] Certifications of Loss.

The Contractor shall document fully any recommendation to withhold or reduce an insurer’s request for compensation. The Contractor shall, as needed, obtain additional information from the insurers, including underlying claims information. The Contractor shall, at least weekly, report unresolved matters and any irregularities to the Treasury.

5.4.1.2.6. To further ensure the accuracy and integrity of the payments made for the Federal

Share of compensation, the Contractor shall develop with Treasury a plan for closer examination of selected claims files underlying the insurer’s request for payment. Such files shall be reviewed for compliance with the Act and regulation, proper investigation and processing using appropriate insurance business practices, reasonableness of any litigation settlement not previously approved by the Government, and the reasonableness of claim payment and the allocated loss adjustment expenses.

5.4.1.2.7. The Contractor shall, as needed, obtain additional information from the insurers. This process for examining claims files prior to payment will complement and be reinforced by the planned TRIP Audit contractor’s program of review audit that will generally follow the normal business practices of reinsurers with respect to after payment review or “audit” of losses presented by their ceding companies.

5.4.2. PAYMENT OF THE FEDERAL SHARE

5.4.2.1. The Contractor shall be responsible for managing the insurer reimbursement process, including forwarding recommendations for payment through the COR or other authorized staff to the Treasury Bureau of the Fiscal Service (BFS) for payment. This shall include application of any pro rata reduction in payment as required by Section 103(e) of the Act and implementing regulations.

5.4.2.2. The Contractor shall set up procedures in order to recommend Treasury make payment, or payment with reservation of rights, of the Federal Share of compensation due an insurer for its insured losses, within 1 business day following the completion of the review of the

[Initial or Supplementary] Certification of Loss.

5.4.2.3. Actual payment to insurers will be made on such conditions as determined by the

Treasury to be appropriate, e.g., payment may be made to an insurer on a monthly schedule or more than once a month. However, Treasury has committed making payments to insurers as promptly as possible, e.g., within 1- 5 business days following contractor notification of

Treasury approval of the insurer’s claim.

5.4.2.4. The Contractor shall work with Treasury to facilitate BFS making expeditious payments to insurers following the transmittal and approval of the request for payment.

5.4.2.5. Payments to insurers are expected to be made by electronic funds transfer. Insurers shall register with the System for Award Management (SAM) at www.sam.gov at the time they register with the Claims Management Facility and/or complete the Initial Notice of Insured Loss.

The Contractor shall be the focal point for all contact with insurers relating to payment. This includes any follow up with Treasury associated with insurer registration in the Government’s

SAM.

5.4.2.6. The Contractor shall make recommendations for payment in written form, with an authorized signature of the Contractor, or in secure electronic form. All requests for payment shall be submitted to the COR or other authorized staff for approval prior to payment by

Treasury BFS. Requests shall contain, at a minimum, a reference number assigned by the

Contractor in coordination with Treasury BFS, and shall include the insurer’s name, the date of the Certification of Loss, and the amount and shall also include the pro rata reduction and net payment amounts, as appropriate.

5.4.2.7. Treasury BFS will make payment to insurers in accordance with Certifications of Loss and the COR approved Contractor recommendations. Treasury will inform the Contractor of the date and amount of each payment made as well as any repayments received. The Contractor shall be the focal point for receipt of insurer requests for information and following up on payment issues with Treasury.

5.4.2.8. Notwithstanding the reporting and other requirements appearing elsewhere in this task, the Contractor shall, at a minimum, operate financial systems which ensure proper financial control over payments of the Federal Share of compensation due an insurer for its insured losses.

The Contractor shall provide physical security and internal controls to safeguard the payment request processes and records and to provide accurate, reliable information on claims by insurers.

5.4.2.9. The Contractor shall, at no time, disburse money or accept receipts on behalf of the

Treasury.

5.4.3. Program Accounting and Payments and Reconciliation of Payments of the Federal Share

5.4.3.1. The Contractor shall maintain records for each insurer claiming reimbursement by

Program Year and in addition, records shall be maintained by Federal fiscal year.

5.4.3.2. The Contractor shall be responsible for maintaining financial records for Program compensation payments and, not withstanding any other requirements of this contract, by the 5th business day after the end of each month, the Contractor shall prepare a detailed report showing by insurer and overall, all payments and correcting or recovery transactions, e.g., by Program

Year [on an accident year basis], by fiscal year by recipient, and by CAT code. This report and/or the data shall be delivered both to Treasury and to the TRIP statistical agent, if another contractor, in agreed upon forms and formats.

5.4.3.3. At least monthly, the Contractor shall reconcile its accounts and records with those maintained by Treasury and with the Certifications of Loss submitted by the insurers. This reconciliation shall encompass the net amount due to or due from each insurer claiming payment with all payments made by Treasury and all receipts, payables, or receivables. Any over payments to an insurer are required to be returned to Treasury within 45 calendar days. The contractor shall cooperate with Treasury and provide such information as necessary to ensure that Treasury’s financial reporting is accurate and timely.

5.4.3.4. The Contractor shall produce and maintain readily available for research and audit purposes, in the most appropriate media, e.g., paper, magnetic tape or disk, backup copies of all financial data and reports. The Contractor shall, every six months, provide Treasury with a complete, up to date set of all procedures, including data and report dictionaries, and sample copies of all systems generated and other reports. All materials shall be suitably safeguarded.

5.4.4. REPORTING

5.4.4.1. The Contractor shall be responsible for reporting on claims and insurer payments, notwithstanding the fact that Treasury will perform all formal accounting and external financial reporting under the Chief Financial Officers Act. The Contractor shall operate and maintain a system and database(s) for this regular reporting, as well as for ad hoc reporting on the Program and operations of the facility. The system shall be capable of receipt of information from insurers and of exchanging data via secured web-link with the Treasury and/or a Program statistical agent. The system and database shall have the capability to perform regular archiving of information in order to perform retrospective analyses and research.

5.4.4.2. The Contractor shall submit, within 15 business days following the end of each month, a Monthly Progress Narrative report covering work planned and accomplished during each month of the task.

5.4.4.3. The Contractor shall furnish the Government, with such regular reports and data as are specified elsewhere in this Contract and any other reports that may be reasonably requested. The aforementioned reports, shall, as required, also be utilized for the Contractor’s performance as

Program “statistical agent” (see paragraphs 5.5 and 5.7)

5.4.4.4. The Contractor shall establish as an integral element of all statistical and financial reporting processes such reviews and procedures as may be required to ensure the control, quality, consistency and integrity of data. Such systems and procedures shall also serve to ensure that all systems operations and reporting are conducted efficiently and economically.

5.4.4.5. The Contractor shall establish and maintain a system of report and data controls and reconciliation to ensure quality, consistency, comparability and economy in all data and reports provided to and for the Government and produced for internal operations and control. The controls shall be exercised and the reconciliations shall be performed for all routinely created and ad hoc reporting.

5.4.5. CUSTOMER AND OTHER SERVICES

5.4.5.1. The Contractor shall exercise control over all incoming correspondence and shall respond to correspondence within 7 business days. Responses to case by case Program policy-related inquiries will be identified and promptly coordinated with the Treasury, i.e., within 2 business days of receipt, so that a 10 business day limit for response may be met. All responses will be written in “plain English” and a file copy maintained for review.

5.4.5.2. TRIP Information Center-The Contractor shall have staff trained in insurance and reinsurance practices and terminology and the requirements of the TRIP who will accept telephone calls from at least 9 am to 5 pm Eastern Standard Times (EST)/Eastern Daylight

Saving Time (EDT), weekdays. Telephone inquiries shall be promptly answered, i.e., 90% of calls are received by staff members within 45 seconds, with inquiries and responses characterized as to subject area and reduced to writing, if appropriate. Call volumes, trends and performance shall be reported weekly. Problem inquiries shall be reduced to writing, and resolved or responded to within 5 business days. If the problem has been identified by an insurer, Treasury shall be informed of the matter within 1 business day.

5.4.5.3. Help Desk- The Contractor shall have staff to research and resolve operating problems identified by the insurers or by Treasury. The Contractor shall also provide “Help Desk” services for systems related matters. Help Desk level matters shall be reduced to writing, logged, reported to Treasury and resolved within 2 business days.

5.4.5.4. The Contractor shall also have qualified staff to research and document claims matters that may be in dispute between Treasury and an insurer. The Contractor shall respond to requests for such assistance within 5 business days of receipt.

5.4.5.5. The Contractor shall, as requested, make available to the Office of the General Counsel or to the Office of the Inspector General within 5 business days all of the facility’s pertinent books, documents, papers and records that may be requested as a result of litigation, audit or other matter.

5.4.6. AUDIT AND AUDIT SUPPORT

5.4.6.1. The Contractor shall provide space and other needed support and shall cooperate with

Treasury auditors, or independent auditors engaged by Treasury to conduct reviews, financial and other audits of the Program. The Contractor shall provide similar support to the TRIP Audit contractor in any review of the facility and as it conducts the planned program of reviewing or

“auditing” losses that will generally follow the normal business practices of reinsurers with respect to claims presented by their ceding companies.

5.4.6.2. Program regulations, Subpart G – Audit and Investigative Procedures, Section 50.60, Audit Authority, provide that the Secretary of the Treasury, or his authorized representatives, shall have access to all books, documents, papers and records of an insurer that are pertinent to amounts paid to the insurer as the Federal Share of compensation for insured losses for the purpose of investigation, confirmation, audit and examination. The Contractor shall, as requested, make available within 5 business days to the auditors and to the TRIP Audit contractor, all of the facility’s books, documents, papers and records that are pertinent to amounts paid to an insurer. Further, the facility itself shall be subject to annual audit by the

Treasury or its authorized representative.

5.5 TRANSITION OR DEVELOP AND TEST A STATISTICAL AGENT ANALYSIS

AND REPORTING CAPABILITY (TASK 5)

5.5.1. The Contractor shall provide personnel possessing the appropriate qualifications, skill sets and experience and do all things necessary for the successful performance of the task. The

Contractor shall perform the work described herein to successfully (1) complete the activities necessary transition or to establish, test and have ready the successor TRIP Consolidation of

Information/Statistical Agent Capability and, as necessary, assume the existing work performed under the current Contract. The Capability shall be in place, tested and operational within 90 calendar days after issuance of this task. During this start up period, the Contractor shall report its progress and any problems on a weekly basis.

5.5.2. The Contractor shall consolidate its own transaction and financial reporting with those of other Contractors, if any, managing claims for payment under this Program. The Contractor shall adapt or establish systems necessary to enable it to serve as the focal point for the coordination, control of the movement and consolidation of TRIP information and reports between TRIP claims management contractors, the Treasury and others designated by the

Government.

5.5.3. The Contractor shall furnish a web-based system for the receipt and exchange of information with the Treasury, TRIP claims management contractors and the TRIP Audit contractor. The Contractor shall ensure that any systems and interfaces with the Treasury and

Treasury’s contractors provide security for the information transmitted and ensure that any business sensitive, proprietary and personal information received and generated is suitably protected. (See Attachment 2 Treasury Information Security Policy Requirements)

5.5.4. The Contractor shall establish, operate and maintain a system and database(s), e.g., of overall Program information as well as of individual insurer Notices, Certifications and

Schedules, including bordereau information. The system and database shall support regular and ad hoc reporting as well as Program investigation and auditing of the Program. The Contractor shall assist Treasury in the design of standard and ad hoc reports. The system and database shall have the capability to perform regular archiving of information in order to perform retrospective analyses and research.

5.5.5. The information consolidation (statistical agent) capability shall be in place, tested and certified as operational within 90 calendar days after issuance of this task. A complete set of all procedures to be used in the consolidation of information including data and report dictionaries, and sample copies of all systems generated and other reports shall be provided with the

Contractor’s certification. (Note, during this start up period, the Contractor shall report its progress and any problems on a weekly basis.)

5.6 PERIODIC REVIEW AND TESTING OF THE STATISTICAL AGENT

CAPABILITY – SYSTEM SECURITY AND CERTIFICATION AND ACCREDITATION

(TASK 6)

5.6.1. After initial “acceptance” testing of the TRIP Statistical Agent Capability, the Contractor shall regularly test and report on its readiness. Testing shall be coordinated with the testing of the Claims Management Facility (see paragraph 5.2, Task 2). Testing shall typically be .planned and performed with Contractor, TRIP Auditor and Treasury staff participation. Test reports shall be due 7 business days after test completion. Test report findings shall be presented to Treasury and follow up activities shall be agreed upon. Tests shall be conducted no more than every four months during the Program/calendar 2014 and no more than every four months in subsequent

Program Years, i.e., the contract Option Years. Deficiencies found as a result of periodic testing shall be corrected by the contractor at no additional cost to Treasury. (If testing determines that system enhancements are required, e.g., to improve flexibility or user friendliness, these will be addressed via requirements issued pursuant to Task 3.)

5.6.2. The Statistical Agent System shall be included in the activities required to secure and maintain the Certification and Accreditation of the TRIP Claims Management System (see

5.1.3.3 and Attachment 2,Treasury Information Security Policy Requirements).

5.6.3. Notwithstanding the requirements elsewhere in this Contract, the Contractor shall fully test contingency plans and disaster recovery procedures that ensure continuity of capability in the event that the [primary] systems and locations are inoperable. (Note, the primary operating site and the remote backup site(s) must be within the Continental United States.) Test results shall be delivered within 7 business days after completion of testing and shall be accompanied by a complete set of all procedures and a complete, current set of all systems documentation, systems generated and other reports.

5.7 STATISTICAL AGENT/ REPORTING AND ANALYSIS FOLLOWING

ACTIVATION (TASK 7)

5.7.1. Following certification of an act of terrorism and within 7 business days after Contracting

Officer issuance of task 7, the Contract shall activate the TRIP data exchange and statistical agent systems and establish required databases. The Contractor shall certify that all necessary staff, systems and equipment described in task 6 are in place and ready to begin operations. The

Contractor shall ensure that all systems are available at least 99% of business hours and that no disruption in systems availability or operations exceeds 72 hours for the term of the Task.

5.7.2. The Contractor shall include in their Monthly Progress Narrative Report the work planned and accomplished pursuant to this Task. The Monthly Progress Narrative Report shall be submitted within 15 business days after the end of each month.

5.7.3. The aforementioned systems shall be utilized for analyses, developing and reporting of

TRIP experience on both a Program Year [accident year] and Federal fiscal year basis, to provide for special reporting, to measure and analyze trends, provide data for input to risk and other models, and otherwise support the information needs of the Program, e.g., to estimate or determine actual aggregate insured losses in order to comply with the $100 billion Program

Year cap on payments for insured losses, the required notice to Congress and the calculation of the pro rata reduction in payments to insurers.

5.7.4. The Contractor shall provide for secure web-based access to system(s) data by designated

Treasury offices. The Contractor, as needed, shall also provide disks, hard copy or other media.

The Contractor shall be responsible for analysis and formulation of recommendations to

Treasury of changes to enhance the timely dissemination of data to designated users and ensure that they are met in the most appropriate and cost effective fashion.

5.7.5. Data collected from the Program claims management contractors shall be validity edited/audited in detail and shall be compared and balanced against Program disbursements.

5.7.6. The Contractor shall operate and maintain the systems and database(s) for regular and ad hoc reporting of TRIP operations. The Contractor shall furnish the Government, with such reports as are specified elsewhere in this Contract as well as any other reports which the

Contracting Officer or the COR may reasonably request. The Contractor shall assist Treasury in the design of standard and ad hoc reports.

5.7.7. The Contractor shall establish as an integral element of all statistical and financial reporting processes, such reviews and procedures as may be required to ensure the control, quality,…