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Prepared for Springfield R-XII School District
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8. If you have any additional information you would like to provide on the investment
vehicles identified above, please do so as an appendix to your responses.
Please see the detailed investment line-up in the CBIZ section of this RFP response
K. Insurance and Litigation Information
1. Describe your organization’s bonding, E&O, and similar insurance coverages
applicable to the services proposed.
VALIC maintains a self-insurance program for all claims made against VALIC and its
subsidiaries in the event that VALIC should become legally obligated to pay as determined
by a court of competent jurisdiction on account of Professional Liability imposed upon
VALIC, by law or assumed under written contract for which VALIC is legally responsible.
With respect to VALIC Financial Advisors, Inc. (VFA), VALIC, VFA's parent company, has
obtained Errors and Omissions (E&O) coverage for the selling and servicing of VFA
products. E&O coverage provides $1 million per claim for 1) each Financial Advisor, District
Vice President and Regional Vice President associated with VFA; and 2) VFA as an
entity. Each Financial Advisor, District Vice President and Regional Vice President has a
coverage limit of $1 million in aggregate per year. VFA as an entity provides a coverage
limit of $1 million per occurrence and $2 million in aggregate per year. Such coverage is
provided by Markel American Insurance Company.
2. Describe any litigation or regulatory action involving the services provided by your
organization that are related to this REP within the past five years.
The Variable Annuity Life Insurance Company (“VALIC”) and its subsidiary companies
VALIC Financial Advisors, Inc. (“VFA”) and VALIC Retirement Services Company
(“VRSCO”) (collectively, “VALIC companies”) are from time to time involved in a variety of
litigation matters related to their retirement plan services businesses. All previously closed
litigation matters were resolved on terms satisfactory and non-material to VALIC companies’
ability to provide their products and services. VALIC specifically discloses that it is currently
defending a lawsuit filed in the Circuit Court of Kanawha County, West Virginia on
November 12, 2009 by the West Virginia Investment Management Board and The West
Virginia Consolidated Public Retirement Board (the “WV Boards”). In November 2014, the
West Virginia Supreme Court reversed the trial court’s grant of summary judgment in the
Company’s favor, and remanded the matter to the Business Court for further
proceedings. The case is still pending.
While VALIC companies vigorously defend lawsuits, the inherent uncertainties of litigation
do not allow them to predict the ultimate outcome of any litigation matter. VALIC does not
anticipate that this matter will restrict, limit or affect our ability to provide services to the plan
sponsor.
Should you require additional information as to any litigation matter, please contact Tracy
Phillips, Counsel, at (713) 831-8457.