<PAGE>
                                                                    EXHIBIT 10.4


                                AMENDMENT TO THE
                              RETROCESSION CONTRACT

         This AMENDMENT TO RETROCESSION CONTRACT, effective as of October 1,
2003 (the "Amendment"), is made in respect of the RETROCESSION CONTRACT (the
"Retrocession Contract"), dated as of January 1, 2003, between SELECT
REINSURANCE LTD., a Bermuda company (the "Company"), and PXRE Reinsurance Ltd.,
a Bermuda Company (the "Reinsurer"), and beginning October 1, 2003, PXRE
REINSURANCE COMPANY, a Connecticut company, which, effective on such date, shall
be included in the definition of "Reinsurer" as hereinafter provided and
referred to separately in this Amendment as "PXRE Co.." while PXRE Reinsurance
Ltd. shall be referred to in this Amendment separately as "PXRE Ltd." and
"Reinsurer" shall be used to refer to either. Capitalized and other specialized
terms used herein but not otherwise defined shall have the meanings given to
such terms in the Retrocession Contract.


                                    RECITALS

         WHEREAS, the parties desire to amend the term of the Retrocession
Contract to reflect the participation of PXRE Co. as a Reinsurer effective
October 1, 2003;

         NOW THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, it is hereby mutually agreed by the parties as follows:

         1.       The parties hereby agree that, effective as of October 1,
                  2003, PXRE Co. shall become a co-reinsurer under the
                  Retrocession Contract along with PXRE Ltd. The Business
                  Covered pursuant to Article I of the Retrocession Contract
                  shall include all reinsurance programs ceded by PXRE Ltd. and
                  PXRE Co. pursuant to the Amended and Restated Facultative
                  Obligatory Quota Share Retrocessional Agreement between the
                  Company, PXRE Co. and PXRE Ltd. (the "Obligatory Treaty").
                  PXRE Co. shall be obligated under the terms of the
                  Retrocessional Contract for reinsurance programs it cedes to
                  Company under the Obligatory Contract and PXRE Ltd. shall be
                  obligated under the terms of the Retrocessional Contract for
                  reinsurance programs it cedes to Company under the Obligatory
                  Contract. The parties shall agree how each Reinsurer shall
                  participate under the Retrocessional Contract with respect to
                  obligations of Company under the Variable Quota Share
                  Retrocessional Agreement when cessions thereunder are under
                  consideration.

         2.       For purposes of determining whether the Retention has been
                  exceeded with respect to any Loss Occurrence, the Ultimate Net
                  Losses ceded by both PXRE Co. and PXRE Ltd. under the
                  Obligatory Treaty shall be aggregated. Once the Retention is
                  exceeded, PXRE Co. and PXRE Ltd. shall be severally liable for
                  their proportionate share of:

                  (a) the ratio of (i) the losses ceded to Company by each
                  Reinsurer under the Obligatory Treaty from the Loss
                  Occurrence, to (ii) Ultimate Net Loss of Company from such
                  Loss Occurrence; and

                  (b) the Limit in the ratio of each Reinsurers obligations for
                  Ultimate Net Loss from each Loss Occurrence until the Limit is
                  reached; provided however that in no event shall aggregate
                  liability of the Reinsurers exceed the Limit.

<PAGE>

         3.       The Reinsurance Premium payable by the Company pursuant to
                  Article 6 shall be allocable to each Reinsurer hereunder based
                  upon the ratio of premium ceded by such Reinsurer to the
                  Company under the Obligatory Treaty compared to the total of
                  such premium.

         4.       Article 21 of the Retrocession Contract is hereby amended and
                  replaced as follows:

                  Each Reinsurer and the Company shall have, and may exercise at
                  any time, the right to offset any amounts due from one party
                  to the other or, to the extent permitted by applicable law,
                  such other's successor, including a successor by operation of
                  law. Such offset may only include amounts due under this
                  Agreement and any other reinsurance agreements heretofore or
                  hereafter entered into between such Reinsurer and the Company,
                  regardless of whether such amounts are in respect of premiums,
                  or losses or otherwise, and regardless of the capacity of any
                  party, whether as reinsurer or reinsured, under the various
                  agreements involved; provided that:

                  (a) upon the occurrence of an Event of Insolvency with respect
                  to PXRE Co., the Company shall, except where prohibited by
                  applicable law, have the right to offset any balance due to
                  Company from PXRE Co. against any amounts due from the Company
                  to PXRE Ltd.;

                  (b) An "Event of Insolvency" shall mean an event whereby one
                  of the parties hereto becomes subject to insolvency,
                  liquidation, rehabilitation proceedings, administrative
                  supervision or governmental action related to the impaired
                  financial position of such party.


         5.       This Amendment shall be construed and enforced in accordance
                  with, and governed by, the laws of the State of New York
                  (other than any mandatory conflict of law rule which might
                  result in the application of the law of any other
                  jurisdiction); provided that in the event of an insolvency
                  proceeding of a party, the law of Bermuda relating to
                  insolvency shall govern, except if the insolvent entity is
                  PXRE Co., the law of Connecticut relating to insolvency shall
                  govern, in each case as to insolvency proceedings in such
                  jurisdictions.



<PAGE>




         In witness whereof, the parties hereto have executed this Amendment at
their principal places of business, effective as of October 1, 2003.



PXRE Reinsurance Company


By: /s/ Mark W. Christie
    ----------------------------
(Name and Title) Mark W. Christie, Vice President



PXRE Reinsurance Ltd.


By: /s/ Robert P. Myron
    ----------------------------
(Name and Title) Robert P. Myron, CFO


Select Reinsurance Ltd.


By: /s/ Cindy Miller
    ----------------------------
(Name and Title) Cindy Miller, Treasurer