QuickLinks -- Click here to rapidly navigate through this document

Exhibit 10.9

AMENDMENT NO. 2
TO
AMENDED AND RESTATED TAX SHARING AGREEMENT

WHEREAS, Zenith National Insurance Corp. ("Zenith National"), and its
subsidiaries Zenith Insurance Company, CalRehab Services, Inc. (formerly ZNAT
Rehabilitation Services, Inc.), CalFarm Insurance Company, CalFarm Insurance
Agency, Cal-Ag Insurance Services, Inc., ZNAT Insurance Company, Zenith Star
Insurance Company and Perma-Bilt, a Nevada Corporation (the "Existing
Subsidiaries), have previously entered into an Amended and Restated Tax Sharing
Agreement; and

WHEREAS, Zenith Insurance Company has entered into an agreement to sell 100% of
the common stock of CalFarm Insurance Company to Nationwide Mutual Insurance
Company ("Nationwide"); and

WHEREAS, CalFarm Insurance Agency is a wholly owned subsidiary of CalFarm
Insurance Company, and

WHEREAS, Cal-Ag Insurance Services, Inc. is a wholly owned subsidiary of CalFarm
Insurance Agency, and

WHEREAS, it is necessary to amend the Amended and Restated Tax Sharing Agreement
accordingly;

IN CONSIDERATION OF THE PREMISES, the parties agree as follows;

1.Effective as of the close of business of the closing date of the sale of
CalFarm Insurance Company to Nationwide, CalFarm Insurance Company, CalFarm
Insurance Agency and Cal-Ag Insurance Services, Inc. shall be deleted as parties
to the inter-company Amended and Restated Tax Sharing Agreement.

2.In all other respects the Amended and Restated Tax Sharing Agreement remains
unchanged.

IN WITNESS WHEREOF, each of the undersigned parties has caused this Amendment
No. 2 to be executed on its behalf, this 31st day of March, 1999.

ZENITH NATIONAL INSURANCE CORP.   ZENITH INSURANCE COMPANY
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

 
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

              ZENITH STAR INSURANCE COMPANY   CALFARM INSURANCE COMPANY
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

 
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

              CALFARM INSURANCE AGENCY   CALREHAB SERVICES, INC.
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

 
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

              CAL-AG INSURANCE SERVICES, INC.   ZNAT INSURANCE COMPANY
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

 
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

              ZENITH STAR INSURANCE COMPANY   PERMA-BILT, a Nevada Corporation
By:
 
/s/  JOHN J. TICKNER      

--------------------------------------------------------------------------------

 
By:
 

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

        IN WITNESS WHEREOF, each of the undersigned parties has caused this
Amendment No. 2 to be executed on its behalf, this 31st day of March, 1999.

ZENITH NATIONAL INSURANCE CORP.   ZENITH INSURANCE COMPANY
By:
 

--------------------------------------------------------------------------------

 
By:
 

--------------------------------------------------------------------------------

              ZENITH STAR INSURANCE COMPANY   CALFARM INSURANCE COMPANY
By:
 

--------------------------------------------------------------------------------

 
By:
 

--------------------------------------------------------------------------------

              CALFARM INSURANCE AGENCY   CALREHAB SERVICES, INC.
By:
 

--------------------------------------------------------------------------------

 
By:
 

--------------------------------------------------------------------------------

              CAL-AG INSURANCE SERVICES, INC.   ZNAT INSURANCE COMPANY
By:
 

--------------------------------------------------------------------------------

 
By:
 

--------------------------------------------------------------------------------

              ZENITH STAR INSURANCE COMPANY   PERMA-BILT, a Nevada Corporation
By:
 

--------------------------------------------------------------------------------

 
By:
 
/s/  DANIEL SCHWARTZ      

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

QuickLinks

AMENDMENT NO. 2 TO AMENDED AND RESTATED TAX SHARING AGREEMENT