Exhibit 10.1

AMENDMENT NO. 7

The Workers’ Compensation and Employers’ Liability Excess of Loss Reinsurance
Agreement of July 1, 2002, between EMPLOYERS REINSURANCE CORPORATION of Overland
Park, Kansas, and ZENITH INSURANCE COMPANY and ZNAT INSURANCE COMPANY, both of
Woodland Hills, California, is hereby amended as follows:

I.                                         As respects occurrences taking place
on or after May 1, 2007, and net premium income entered on the books and records
of the REINSURED on and after such date:

A.                                  All references to separate layers under this
agreement are hereby deleted, and Article II, Reinsurance, and Article VIII,
Reinsurance Premium, are hereby amended as described herein.

B.                                    Article II, Reinsurance, is hereby deleted
in its entirety and the following is substituted therefor:

ARTICLE II

REINSURANCE.  As respects loss sustained by the REINSURED under this agreement,
for each occurrence regardless of the number of policies involved in such
occurrence, the REINSURED shall retain as its own net retention the first
$5,000,000 of loss and the CORPORATION hereby agrees to indemnify the REINSURED
against loss in excess of such retention subject to a limit of $5,000,000 each
occurrence and an annual aggregate limit of $25,000,000, the first such annual
period commencing on May 1, 2007 and ending the following April 30, and each
successive 12 calendar month period thereafter.

Occupational disease sustained by each employee shall be deemed to be a separate
occurrence.

C.                                    The Terrorism Sublimit specified in
Article III, Terrorism Sublimit, is hereby decreased from $9,000,000 to
$5,000,000 any one 12 month period.

D.                                   Article VIII, Reinsurance Premium, as
amended, is hereby deleted in its entirety and the following is substituted
therefor:

ARTICLE VIII

REINSURANCE PREMIUM.  As respects net premium income derived from policies
reinsured under this agreement, the REINSURED shall pay to the CORPORATION a
reinsurance premium equal to .834% of the net premium income derived by the
REINSURED from those lines of business to which this agreement applies.

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II.                                     As respects occurrences taking place on
or after May 1, 2007:

A.                                  The following new article is hereby added to
this agreement:

ARTICLE V-A

DEFINITION OF OCCURRENCE.  The term “occurrence” shall mean any accident or
occurrence or series of accidents or occurrences arising out of any one event
and happening within the term and scope of this agreement.  Without limiting the
generality of the foregoing, the term “occurrence” shall be held to include:

As respects Occupational Disease under Workers Compensation and Employers
Liability, each case of an employee contracting any disease for which the
REINSURED may be liable shall be considered a separate and distinct occurrence
and the date of each occurrence shall be deemed to be as follows:

(a)                                  If the case is compensable under the
Workers Compensation Law or any Occupational Disease Compensation Act, the date
of the beginning of the disability for which compensation is payable;

(b)                                 If the case is not compensable under the
Workers Compensation Law or any Occupational Disease Compensation Act, the date
of the disability due to said disease actually began;

(c)                                  Where claim is made after employment has
ceased, then the date of the cessation of employment shall be deemed to be the
date of disability.

B.                                    The following new paragraph is hereby
added to Article VI, Definitions of Loss and Claim Expenses:

However, coverage in excess of policy limits and coverage for extra contractual
obligations, as described in subparagraphs (b) and (c) of this article,
respectively, shall not apply where the loss has been incurred due to fraud by a
member of the Board of Directors or a corporate officer of the REINSURED acting
individually or collectively or in collusion with an individual or corporation
or any other organization or party involved in the presentation, defense or
settlement of any claim covered hereunder.

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III.                                 Effective May 1, 2007:

A.                                  The following new paragraph is hereby added
to Article VI, Definitions of Loss and Claim Expenses:

If any provision of this article shall be rendered illegal or unenforceable by
the laws, regulations or public policy of any state, such provision shall be
considered void in such state, but this shall not affect the validity or
enforceability of any other provision of this article or the enforceability of
such provision in any other jurisdiction.

B.                                    The following new article is hereby added
to this agreement:

ARTICLE XV-A

DISPUTE RESOLUTION.

Part I - Choice Of Law And Forum

Any dispute arising under this agreement shall be resolved in the State of
California, and the laws of the State of California shall govern the
interpretation and application of this agreement.

Part II - Mediation

If a dispute between the REINSURED and the CORPORATION, arising out of the
provisions of this agreement or concerning its interpretation or validity and
whether arising before or after termination of this agreement has not been
settled through negotiation, both parties agree to try in good faith to settle
such dispute by nonbinding mediation, before resorting to arbitration.

Part III - Arbitration

A.                                  Resolution of Disputes - As a condition
precedent to any right of action arising hereunder, any dispute not resolved by
mediation between the REINSURED and the CORPORATION arising out of the
provisions of this agreement or concerning its interpretation or validity,
whether arising before or after termination of this agreement, shall be
submitted to arbitration in the manner hereinafter set forth.

B.                                    Composition of Panel - Unless the parties
agree upon a single arbitrator within 15 days after the receipt of a notice of
intention to arbitrate, all disputes shall be submitted to an arbitration panel
composed of two arbitrators and an umpire chosen in accordance with Paragraph C.
hereof.

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C.                                    Appointment of Arbitrators - The members
of the arbitration panel shall be chosen from disinterested persons with at
least 10 years experience in the insurance and reinsurance business.  Unless a
single arbitrator is agreed upon, the party requesting arbitration (hereinafter
referred to as the “claimant”) shall appoint an arbitrator and give written
notice thereof by certified mail, to the other party (hereinafter referred to as
the “respondent”) together with its notice of intention to arbitrate.  Within 30
days after receiving such notice, the respondent shall also appoint an
arbitrator and notify the claimant thereof by certified mail.  Before
instituting a hearing, the two arbitrators so appointed shall choose an umpire. 
If, within 20 days after the appointment of the arbitrator chosen by the
respondent, the two arbitrators fail to agree upon the appointment of an umpire,
each of them shall nominate three individuals to serve as umpire, of whom the
other shall decline two and the umpire shall be chosen from the remaining two by
drawing lots.  The name of the individual first drawn shall be the umpire.

D.                                   Failure of Party to Appoint an Arbitrator -
If the respondent fails to appoint an arbitrator within 30 days after receiving
a notice of intention to arbitrate, the claimant’s arbitrator shall appoint an
arbitrator on behalf of the respondent, such arbitrator shall then, together
with the claimant’s arbitrator, choose an umpire as provided in Paragraph C. of
Part III of this Article.

E.                                     If the REINSURED is involved in a dispute
under the terms of this agreement and in one or more separate disputes with one
or more other reinsurers in which common questions of law or fact are in issue,
the REINSURED or the CORPORATION, at its option, may join with such other
reinsurers in a common arbitration proceeding under the terms of this article. 
If the REINSURED and such other reinsurers have commenced arbitration, the
CORPORATION may at its option join such proceeding for the determination of the
disupte between the REINSURED and the CORPORATION.

F.                                     Submission of Dispute to Panel – Within
30 days after the notice of appointment of all arbitrators, the panel shall
meet, and determine a timely period for discovery, discovery procedures and
schedules for hearings.

G.                                    Procedure Governing Arbitration - All
proceedings before the panel shall be informal and the panel shall not be bound
by the formal rules of evidence.  The panel shall have the power to fix all
procedural rules relating to the arbitration proceeding.  In reaching any
decision, the panel shall give due consideration to the customs and usages of
the insurance and reinsurance business.

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H.                                   Arbitration Award - The arbitration panel
shall render its decision within 60 days after termination of the proceeding,
which decision shall be in writing, stating the reasons therefor.  The decision
of the majority of the panel shall be final and binding on the parties to the
proceeding.  In no event, however, will the panel be authorized to award
punitive, exemplary or consequential damages of whatsoever nature in connection
with any arbitration proceeding concerning this agreement.

I.                                        Cost of Arbitration - Unless otherwise
allocated by the panel, each party shall bear the expense of its own arbitrator
and shall jointly and equally bear with the other parties the expense of the
umpire and the arbitration.

In all other respects not inconsistent herewith, said agreement shall remain
unchanged.

IN WITNESS WHEREOF, the parties hereto have caused this amendment to be executed
in duplicate.

ZENITH INSURANCE COMPANY

 

EMPLOYERS REINSURANCE

 

 

CORPORATION

 

 

 

/s/ Jack D. Miller

 

/s/ Lawrence D. Hunter-Blank

Title: President

 

Title: Vice President

 

 

 

/s/ Michael E. Jansen

 

/s/ Holly W. Lowe

Title: Executive Vice President and General Counsel

 

Title: Second Vice President

 

 

 

Date:

   July 20, 2007

 

Date:

   July 18, 2007

 

 

 

 

 

 

 

 

ZNAT INSURANCE COMPANY

 

 

 

 

 

 

 

 

/s/ Jack D. Miller

 

 

Title: President

 

 

 

 

 

/s/ Michael E. Jansen

 

 

Title: Executive Vice President and General Counsel

 

 

 

 

 

Date:

   July 20, 2007

 

 

 

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