CWGQ Program FAQ

• Why did QBI enter into the partnership with Continental Western?
• Who is the Continental Western Insurance Group?
• Is the Continental Western GL policy as good as QBI or better?
• How does the dividend program work?
• Is the CWGQ program competitive from a pricing perspective?
• Will QBI continue to sell general liability insurance?
• What if my agent is not a Continental Western agent?
• Will the Builders Association still be involved with insurance?

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Why did QBI enter into partnership with Continental Western?
The QBI Board entered into the partnership with CWG for several reasons

1. CWG is offering better coverage at bettwer rates than QBI. QBI's first responsibilities are to the QBI policyholders and secondly, to the members of the Builders Association of Minnesota. Further, the CW program is a dividend program that rewards policyholders who are in the program.
2. QBI entered into the partnership because Continental Western saw the value of the extensive risk management program QBI created. Only a group of builders could best develop a program to manage the risk of the homebuilding industry. CWG adopted the QBI Risk Management program into this new program and has hired Paul Majka to oversee risk management in the field.
3. Longevity and commitment are key. CWG has been offering similar programs in Iowa and Wisconsin for 10 and 4 years respectively. They have shown a commitment to write insurance for ou rindustry even when other insurers have withdrawn from the residential construction insurance market.

Who is the Continental Western Insurance Group?

Continental Western Insurance Company has its home office in Des Moines, Iowa. Regional Office are located in Boise, Idaho; Luverne, Minnesota and Lincoln, Nebraska. They underwrite the insurance programs for the residential construction industry in both Iowa and Wisconsin.

They have written premiums in the hundreds of million dollars and offer a full line of Commercial Lines products. They operate through independent insurance agents in Colorado, Idaho, Iowa, Indiana, illinois, Kansas, Minnesota, Missouri, Montana, North Dakota, Nebraska, Ohio, Oregon, South Dakota, Utah, Washington, Wisconsin and Wyoming. The companies are members of the WR Berkley Corporation, which is one of the top 25 property and casualty insurance companies in the United States.

CWG has an AM BEST rating of A. They are a well-respected company with over 200 agents throughout the state of Minnesota.

Is the Continental Western GL policy as good as QBI or better?

CWG's GL policy is an occurrence based policy and will offer the residential contractor comprehensive coverage. QBI attorneys have carefully reviewed CWG's GL policy and we are pleased to say that the policy offers completed operations coverage for property damage caused by a subcontractors work. In addition, CWG's GL policy does not cap water intrusion claims for homes built after January 1, 2000.

How does the dividend program work?

A dividend is paid when the insurance company decides they have earned enough profit from a product to share that profit as a dividend with the policyholder. When Continental Western decides to declare a dividend, the dividend will be sent to the Builders Association of Minnesota to disburse. After the initial investors in QBI have been paid back, BAM will send the dividend to all CWGQ policyholders. If all goes well, we believe that policyholders may receive their first dividend by 2009. The immediate payoff is better insurance coverage and the return to a stable insurance market for builders.

Is the CWGQ program competitive from a pricing perspective?

Yes. The price structure is competitive and in many circumstances the pricing is lower than the current QBI premium. In order to obtain the CWGQ program pricing, the policyholder must roll over the general liability insurance, the auto insurance, the builder's risk and the umbrella where applicable. The Builders Association encourages members to purchase workers comp insurance from The Builders Group.

Will QBI continue to sell general liability insurance?

No. The Board has determined that the Continental Western program is the best program for the membership and after all QBI policyholders have rolled over, QBI will cease operations.

The new CWGQ program will be the only insurance program endorsed by the Builders Association of Minnesota for the state, along with The Builders Group Workers Compensation program.

What if my agent is not a Continental Western agent?

We have provided an opportunity for your agent to purchase this product through the program's Managing General Agent. Your agent can contact Larry Heisler at 515-557-1215 to assist you in getting your insurance rolled over.

Will the Builders Association still be involved with insurance?

Yes! You can be sure that we will play a role in working with the CWGQ program to make sure you are getting the service and attention you need. We plan to meet with the company leadership on a quarterly basis to keep us on track. BAM will also continue to publish articles on what is happening in the insurance world and we intend to conduct an annual policyholder event every summer to celebrate our success.