# Policyholder Disclosure

## Notice of Terrorism Insurance Coverage

**Named Insured:**
- International Business Machines Corporation
- One New Orchard Road, (Mail Drop 109)
- Armonk, NY 10504

**Producer:**
- Aon Risk Services Northeast Inc.
- One Liberty Plaza 165 Broadway
- New York, NY 10006

**Policy Term:**
- May 21, 2021 to May 21, 2022
- Date: 05/21/2021

## Offer of Coverage

You are hereby notified that under the Terrorism Risk Insurance Act, as amended, that you have a right to purchase insurance coverage for losses resulting from acts of terrorism, as defined in Section 102(1) of the Act:

The term "act of terrorism" means any act that is certified by the Secretary of the Treasury—in consultation with the Secretary of Homeland Security and the Attorney General of the United States—to be a violent act or an act that is dangerous to human life, property, or infrastructure; to have resulted in damage within the United States, or outside the United States in the case of certain air carriers or vessels or the premises of a United States mission; and to have been committed by an individual or individuals as part of an effort to coerce the civilian population of the United States or to influence the policy or affect the conduct of the United States Government by coercion.

YOU SHOULD KNOW THAT WHERE COVERAGE IS PROVIDED BY THIS POLICY FOR LOSSES RESULTING FROM CERTIFIED ACTS OF TERRORISM, SUCH LOSSES MAY BE PARTIALLY REIMBURSED BY THE UNITED STATES GOVERNMENT UNDER A FORMULA ESTABLISHED BY FEDERAL LAW. HOWEVER, YOUR POLICY MAY CONTAIN OTHER EXCLUSIONS WHICH MIGHT AFFECT YOUR COVERAGE, SUCH AS AN EXCLUSION FOR NUCLEAR EVENTS UNDER THE FORMULA, THE UNITED STATES GOVERNMENT COVERAGE WILL BE REDUCED TO EIGHTY PERCENT (80%) THROUGH 2024, 84% BEGINNING ON JANUARY 1, 2016, 83% BEGINNING ON JANUARY 1, 2017, 82% BEGINNING ON JANUARY 1, 2018, 81% ON JANUARY 1, 2019 AND 80% BEGINNING ON JANUARY 1, 2020 OF COVERED TERRORISM LOSSES EXCEEDING THE STATUTORILY ESTABLISHED DEDUCTIBLE PAID BY THE COMPANY PROVIDING THE COVERAGE. THE PREMIUM CHARGED FOR THIS COVERAGE IS PROVIDED BELOW AND DOES NOT INCLUDE ANY CHARGES FOR THE PORTION OF LOSS THAT MAY BE COVERED BY THE FEDERAL GOVERNMENT UNDER THE ACT.

YOU SHOULD ALSO KNOW THAT THE TERRORISM RISK INSURANCE ACT, AS AMENDED, CONTAINS A $100 BILLION CAP THAT LIMITS U.S. GOVERNMENT REIMBURSEMENT AS WELL AS THE INSURERS' LIABILITY FOR LOSSES RESULTING FROM CERTIFIED ACTS OF TERRORISM WHEN THE AMOUNT OF SUCH LOSSES IN ANY ONE CALENDAR YEAR EXCEEDS $100 BILLION. IF THE AGGREGATED INSURED LOSSES FOR ALL INSURERS EXCEED $100 BILLION, YOUR COVERAGE MAY BE REDUCED.

This Notice does not form a part of your insurance contract. The Notice is designed to alert you to coverage restrictions and to other provisions in certain terrorism endorsement(s) in this policy. If there is any conflict between this notice and the policy (including its endorsements) the provisions of the policy (including its endorsements) apply.

**AGRL-IL 8T01 (01-15)**

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**Named Insured:** International Business Machines Corporation

## Selection or Rejection of Terrorism Insurance Coverage

IF YOU ELECT TO PURCHASE COVERAGE FOR ACTS OF TERRORISM, AS DEFINED IN THE ACT, AND YOU FAIL TO PAY THE PREMIUM IN FULL STATED BELOW, YOUR POLICY WILL BE CANCELLED FOR NONPAYMENT OF PREMIUM IN ACCORDANCE WITH STATE LAW.