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Exhibit 10.28

STOCK OPTION AGREEMENT
ZENITH NATIONAL INSURANCE CORP.
1996 EMPLOYEE STOCK OPTION PLAN

        This Stock Option Agreement ("Option Agreement") effective as of
the            day of                        20    , (the "Effective Date"), is
entered into on this      day of                        , 20    , between ZENITH
NATIONAL INSURANCE CORP. ("ZENITH"), a Delaware corporation,
and                        , an employee of ZENITH's
subsidiary,                        ("EMPLOYEE").

        ZENITH desires to afford EMPLOYEE an opportunity to purchase ZENITH'S
one dollar par value common stock ("Common Stock"), as hereinafter provided,
pursuant to the terms of ZENITH'S 1996 Employee Stock Option Plan (the "Stock
Option Plan").

        NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth and for other good and valuable consideration, the parties hereto agree as
follows:

        Section 1.    Grant of Option.    ZENITH hereby irrevocably grants to
EMPLOYEE the right and option ("Option") to purchase all or any part of an
aggregate of                         (                        ) shares of Common
Stock (such number being subject to adjustment as provided in Section 8 hereof)
on the terms and conditions herein set forth.

        Section 2.    Purchase Price.    The purchase price of the Common Stock
subject to the Option shall be                         Dollars
and            Cents ($            ) per share.

        Section 3.    Terms of Option.    The term of the Option shall be for a
period of five years commencing on the Effective Date and ending on the day
before the fifth anniversary of the Effective Date, subject to earlier
termination as provided herein. The Option may be exercised from time to time as
follows:

        (a)   During the first full year of the Option (namely that period
commencing on the Effective Date and ending on the day before the first
anniversary of the Effective Date), no portion of the Option may be exercised;

        (b)   During the second full year of the Option (namely that period
commencing on the first anniversary of the Effective Date and ending on the day
before the second anniversary of the Effective Date), the Option may be
exercised to the extent of one-fourth (1/4) of the aggregate number of shares
set forth in Section 1 hereof;

        (c)   During the third full year of the Option, (namely that period
commencing on the second anniversary of the Effective Date and ending on the day
before the third anniversary of the Effective Date), the Option may be exercised
to the extent of one-fourth (1/4) of the aggregate number of shares set forth in
Section l plus the excess of one-fourth (1/4) over the number of shares actually
purchased during the second full year of the Option;

        (d)   During the fourth full year of the Option (namely that period
commencing on the third anniversary of the Effective Date and ending the day
before the fourth anniversary of the Effective Date), the Option may be
exercised to the extent of one-fourth (1/4) of the aggregate number of shares
set forth in Section l plus the excess of one-half (1/2) of the aggregate number
set forth in Section 1 over the number of shares actually purchased during the
second and third full years of the Option; and

        (e)   During the fifth full year of the Option (namely, the period
commencing on the fourth anniversary of the Effective Date and ending the day
before the fifth anniversary of the Effective Date), the Option may be exercised
to the extent not therefore exercised.

The purchase price of the Common Stock to be purchased hereunder shall be paid
by EMPLOYEE in full at the time of issuance of the shares: (1) in cash; (2) with
previously acquired shares of Common

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Stock having a fair market value equal to the purchase price; (3) with a
combination of cash and previously acquired shares of Common Stock having an
aggregate fair market value equal to the purchase price; or (4) as otherwise
permitted from time to time under the terms of the Stock Option Plan. Except as
provided in Section 6 or 7 hereof, the Option may not be exercised at any time
unless EMPLOYEE shall have been in the continuous employment of ZENITH or any
subsidiary from the Effective Date to the date of exercise of the Option.

        Section 4.    Method of Exercise.    EMPLOYEE may exercise his right
under the Option by delivering a notice of exercise in writing to ZENITH at its
principal corporate headquarters. Such notice shall state: (i) the number of
shares with respect to which the Option is then being exercised, (ii) the date
on which EMPLOYEE will take and pay for such shares, and (iii) the method of
payment for such shares. Stock certificates shall be registered in the name of
EMPLOYEE (or, subject to the requirements of applicable law, EMPLOYEE's nominee
or designee) and shall issue against receipt of payment in full in accordance
with the methods of payment set forth in Section 3 hereof.

        Section 5.    Nontransferability.    The Option shall not be
transferable otherwise than by will or the laws of descent and distribution, and
the Option may be exercised, during the lifetime of EMPLOYEE, only by him. More
particularly but without limiting the generality of the foregoing, the Option
may not be assigned, transferred (except as provided above), pledged or
hypothecated in any way, shall not be assignable by operation of law, and shall
not be subject to execution, attachment, or similar process. Any attempted
assignment, transfer, pledge, hypothecation, or other disposition of the Option
contrary to the provisions hereof, and the levy of any execution, attachment, or
similar process upon the Option shall be null and void and without effect.

        Section 6.    Termination of Employment.    If EMPLOYEE should cease to
be an employee of ZENITH or a subsidiary for any reason other than his death,
EMPLOYEE shall have the right to exercise his rights under the Option (to the
extent exercisable on the date of termination of employment) within three months
from the date of termination of his employment, but not more than five (5) years
from the Effective Date, whichever shall first occur. The Option, to the extent
not so exercised, shall thereupon terminate. The granting of the Option shall
not constitute or be evidence of any agreement or undertaking, expressed or
implied, on the part of ZENITH or a subsidiary to employ EMPLOYEE for a
specified period; nor shall it interfere with the right of ZENITH or a
subsidiary to terminate EMPLOYEE's employment at any time; nor shall EMPLOYEE
under any circumstances be entitled to exercise any portion of the Option not
exercisable according to the terms of this Option Agreement as of the date of
the termination of his employment.

        Section 7.    Exercise on Death.    If EMPLOYEE should die while
employed by ZENITH or a subsidiary or within three (3) months after termination
of employment, the Option may be exercised at any time within one (1) year from
the date of EMPLOYEE's death but not more than five (5) years from the Effective
Date, whichever shall first occur. Such exercise may be by EMPLOYEE's executors
or administrators or by any person or persons who have acquired the Option from
EMPLOYEE by bequest or inheritance and the exercise may be as to all or any
portion of the aggregate number of shares to which EMPLOYEE would have been
entitled at the earlier of the date of his death or the termination of his
employment. The Option, to the extent not so exercised, shall thereupon
terminate.

        Section 8.    Changes in Capital Structure.    In the event of any
merger, reorganization, consolidation, recapitalization, stock dividend or other
change in corporate structure affecting the Common Stock, the Option shall be
adjusted as provided in Section 3 of the Stock Option Plan.

        Section 9.    Rights as Stockholder.    Except as expressly provided in
Section 8 hereof, EMPLOYEE shall have no rights as a stockholder with respect to
any optioned shares until EMPLOYEE has given written notice of exercise of the
Option, paid in full for such shares and, if requested by ZENITH, executed the
investment letter described in Section 10 hereof. Such stockholder rights
include, but are not limited to: the occasion of any subdivision or
consolidation of any ZENITH stock or securities; or the payment of any stock
dividend; or any other increase or decrease in the number or amount of any
ZENITH stock or securities; or any rights with respect to any dissolution,
liquidation, reorganization, merger, or consolidation, or spin-off of assets or
stock of ZENITH or another corporation.

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        Section 10.    Investment Letter.    EMPLOYEE, by execution of this
Option Agreement, hereby represents and agrees that any Common Stock which has
not been registered under the provisions of the Securities Act of 1933, as
amended (the "Securities Act"), will be purchased for investment and not with a
view to distribution or resale. EMPLOYEE further agrees to execute, if requested
by ZENITH, prior to the issuance of any shares purchased by him under the Option
and as a condition upon which any such shares shall be issued, excepting those
shares which have been registered under the provisions of the Securities Act, a
letter in such form as ZENITH may reasonably request setting forth the
representations and agreements of EMPLOYEE that such shares are being purchased
for investment and not with a view to their resale or distribution.

        Section 11.    Investment Restriction.    Any shares issued upon the
exercise of the Option, excepting those shares which have been registered under
the provisions of the Securities Act, shall be acquired for investment purposes
only, and the certificates representing such non-registered shares shall bear a
restrictive investment legend to the following effect:

The shares represented by this certificate have not been registered under the
Securities Act of 1933, as amended (the "Act"). The shares have been acquired
for investment and may not be sold, transferred, pledged, or hypothecated in the
absence of an effective registration statement for the shares under the Act or
an opinion of counsel to Zenith National Insurance Corp. that such transaction
would not be in violation of the provisions of the Act.

        Section 12.    General    ZENITH shall at all times during the term of
the Option reserve and keep available a number of shares of Common Stock
sufficient to satisfy the requirements of this Option Agreement, and shall pay
all original issue taxes with respect to the issuance of shares pursuant to this
Option Agreement and all other fees and expenses incurred by ZENITH in
connection therewith.

        Section 13.    Arrangement for Tax Payment.    EMPLOYEE shall make any
arrangements required by ZENITH to provide that the amount of any tax required
to be withheld by ZENITH or any subsidiary as a result of the exercise of this
Option is available for payment of such tax withholding obligations.

        IN WITNESS WHEREOF, ZENITH has caused this Option Agreement to be duly
executed and EMPLOYEE has hereunto set his hand on the             day
of                        20    .

ZENITH NATIONAL INSURANCE CORP.    
By:
 
    

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"EMPLOYEE"         

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Exhibit 10.28

STOCK OPTION AGREEMENT ZENITH NATIONAL INSURANCE CORP. 1996 EMPLOYEE STOCK
OPTION PLAN