<PAGE>   1
                              EMPLOYMENT AGREEMENT




                                 BY AND BETWEEN


                      SAGE LIFE ASSURANCE OF AMERICA, INC.


                                       AND



                                ROBIN I. MARSDEN




                                        EFFECTIVE:  April 1, 2000
<PAGE>   2
                              EMPLOYMENT AGREEMENT

                                TABLE OF CONTENTS

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1.    EMPLOYMENT...........................................................................................         1
      1.1 General Duties and Title.........................................................................         1
      1.2 Full-Time Position...............................................................................         2
2.    TERM.................................................................................................         2
3.    REMUNERATION.........................................................................................         2
4.    LONG TERM CAPITAL INCENTIVE COMPENSATION.............................................................         2
5.    WITHHOLDING..........................................................................................         3
6.    INSURANCE AND OTHER BENEFIT PLANS....................................................................         3
7.    VACATIONS............................................................................................         3
8.    BUSINESS EXPENSES....................................................................................         3
9.    INDEMNIFICATION......................................................................................         4
10.   TERMINATION OF EMPLOYMENT............................................................................         4
      10.1  Termination by the Company for Cause...........................................................         4
      10.2  Definition of Cause............................................................................         5
      10.3  Determination of For Cause Termination.........................................................         5
      10.4  Termination by the Company Without Cause.......................................................         6
      10.5  Compulsary Relocation following a Change of Control............................................         6
      10.6  Voluntary Termination by the Executive.........................................................         6
      10.7  Disability Termination.........................................................................         7
      10.8  Termination Due to Executive's Death...........................................................         7
11.   RESTRICTIVE CONVENANTS; CONFIDENTIALITY; OWNERSHIP OF PROCEEDS OF EMPLOYMENT.......................           8
      11.1  Solicitation of Employees; Customers; Agents or Representatives etc............................         8
      11.2  Confidential Records...........................................................................         8
      11.3  Ownership of Proceeds of Employment............................................................         9
      11.4  Survival.......................................................................................         9
      11.5  Enforceability; Remedies.......................................................................         9
12.   MISCELLANEOUS PROVISIONS.............................................................................         9
      12.1  Severability...................................................................................         9
      12.2  Execution in Counterparts......................................................................        10
      12.3  Notices........................................................................................        10
      12.4  Entire Agreement and Subsequent Amendments.....................................................        11
      12.5  Applicable Law.................................................................................        11
      12.6  Headings.......................................................................................        11
      12.7  Binding Effect;  Successors and Assigns........................................................        11
      12.8  Waiver.........................................................................................        11
      12.9  Warranty and Capacity to Contract..............................................................        12
      12.10 Arbitration...................................................................................         12
      12.11 Remedies......................................................................................         12
      12.12 Survival......................................................................................         12
</TABLE>
<PAGE>   3
                              EMPLOYMENT AGREEMENT


THIS EMPLOYMENT AGREEMENT (the "Agreement") dated as of this April 1, 2000 (the
"Effective Date") by and among Sage Life Assurance of America, Inc. (the
"Company") a Delaware life insurance corporation, and Robin I. Marsden an
individual currently residing at 100 Spring Water Lane, New Canaan, Connecticut
("Executive").

WITNESSETH THAT

WHEREAS, the Company desires to employ Executive in accordance with the terms of
this Agreement and Executive desires to be so employed by the Company;

WHEREAS, the parties desire to set forth the employment understanding and terms
and conditions of employment in a written agreement; and Executive wishes to
accept such employment upon the terms and subject to the conditions hereinafter
set forth;

NOW THEREFORE, in consideration of the mutual promises contained herein, the
parties hereto hereby agree as follows:

1.     EMPLOYMENT

1.1    GENERAL DUTIES AND TITLE

       On the Effective Date the Company hereby employs Executive with the
       title/s designated in Exhibit A (the "Position Description") attached
       hereto and forming a part of this Agreement.

       Executive's primary responsibilities and duties are as described in
       Exhibit A. The primary responsibilities and duties of the Executive may
       be altered or amended by either (i) the mutual agreement of the Company
       and the Executive; or (ii) the establishment of new or modified duties,
       as determined by the Company after consultation with the Chairman of Sage
       Group Limited or the Board of Directors of the Company (the "Board"). Any
       modifications or alterations to the duties assigned to the Executive will
       be consistent with the education, background and experience of the
       Executive. Executive shall faithfully and diligently perform for the
       Company all such duties. Executive shall report to and take direction
       primarily from the Chairman of the Sage Group Limited and the Board.
       Executive agrees to act in the capacity of a member or officer of such
       boards as he may be appointed without remuneration other than the
       remuneration to which Executive is otherwise entitled under this
       Agreement.

       Services rendered by Executive shall be rendered in accordance with
       recognized insurance and financial industry standards and recognized
       codes of conduct or ethics. Executive shall further promote and enhance
       the business purposes of the Company by entertainment and other means,
       including participation in professional organizations and activities,
       attendance at insurance or financial industry conventions and seminars,
       and membership in insurance or financial industry societies.


                                       1
<PAGE>   4
1.2    FULL-TIME POSITION

       Executive during the Term will devote Executive's best efforts, attention
       and skills to the business and affairs of the Company on a full-time
       basis, and shall devote all of Executive's business time and effort to
       the performance of the duties hereunder.

2.     TERM

       The employment of Executive hereunder shall commence on the Effective
       Date and shall continue until this Agreement is terminated as provided in
       Section 10 hereof.

3.     REMUNERATION

       The Company (or an affiliate acting on behalf of the Company) will pay to
       Executive as compensation for services to be rendered under Section 1
       hereof, the following amounts:

       (a)    Monthly Base Salary

              A base salary ("Base Salary") at the monthly equivalent rate of
              Three Hundred and Sixty Three Thousand Dollars ($363,000) per
              annum, reviewable annually in April of each year, commencing with
              the first review being conducted for the performance period
              beginning on the Effective Date and terminating March 31, 2001.

       (b)    Short Term Incentive Bonus Payments

              The Executive will be entitled to participate in the Company's
              Short Term Incentive Bonus Plan periodically established by the
              Company for the benefit of eligible and selected executive
              employees. Payments under the Short Term Incentive Bonus Plan are
              not due and payable until declared payable by the Board.

              The award of the bonus will be based upon the Executive's
              achievement against objective performance criteria periodically
              established by the Company. The satisfaction of the objective
              performance criteria will be determined by the Company in it's
              discretion.

4.     LONG TERM CAPITAL INCENTIVE COMPENSATION

       Executive will be eligible to participate in the Long Term Capital
       Incentive Compensation Plan of the Sage Insurance Group, Inc., the
       operating group parent of the Company. Executive's rights of
       participation in such Long Term Capital Incentive Compensation Plan will
       be determined by the Board from time to time. The summarised terms of the
       Long Term Incentive Compensation Plan are set out in Exhibit B attached
       hereto.

       Executive will continue to participate in the South African executive
       incentive plans in terms of the rules of those plans, whereunder
       allocations are at Sage Group Limited's discretion.


                                       2
<PAGE>   5
5.     WITHHOLDING

       Executive agrees that the Company shall withhold from any and all
       payments required to be made to Executive pursuant to this Agreement all
       actual or potential Federal, State, local and/or other taxes the Company
       determines are required or potentially will be required, to be withheld
       in accordance with applicable statutes and/or regulations from time to
       time in effect.

6.     INSURANCE AND OTHER BENEFIT PLANS

       Executive shall be entitled during the period of employment with the
       Company, to participate in (i) the life insurance and disability
       insurance plans available to executives of the Company, including such
       accidental death or other benefits as may be provided under such plans,
       and (ii) the health and dental and vision plans available to officers
       (and their immediate families) of the Company, and (iii) such other
       employee benefit plans, including all employee welfare benefit plans and
       employee pension benefit plans, that currently are or will be made
       generally available to executives and salaried employees of the Company.
       Descriptions of the current benefit plans are set forth in Exhibit C.
       Participation by or inclusion of the Executive in any benefit plan
       maintained by the Company shall be provided only to the extent that the
       Executive is eligible under the terms and conditions of the applicable
       plan and, if required pursuant to the plan, the employee meets any
       insurance underwriting or other conditions validly required by the
       provider or carrier of the plan or the contracts, policies, or other
       terms of eligibility or participation issued in connection with the plan.

7.     VACATIONS

       Executive shall be entitled to be absent from Executive's duties with the
       Company by reason of vacation for such periods as are consistent with the
       policy of the Company with respect to executive officers generally, which
       policy is more fully described in Exhibit C. In addition, the Executive
       shall be entitled to such national and religious holidays as generally
       approved by the Company.

8.     BUSINESS EXPENSES

       The Company recognizes that, in connection with Executive's performance
       of his duties, functions and responsibilities hereunder, Executive will
       incur certain reasonable and necessary expenses. The Company agrees to
       promptly reimburse Executive for all such reasonable business expenses,
       which are incurred solely in connection with the Company's business, upon
       the presentation of statements setting forth the nature and amount of
       such expenses in reasonable detail, in accordance with the Company's
       generally applicable guidelines and procedures from time to time.

       To the extent that it is subsequently determined by the Company, using
       reasonable standards generally applicable to chief executive officers in
       like capacities, that any expense reimbursed by the Company to the
       Executive is not a reasonable or necessary business expense of the
       Company, and such determination is based upon false, misleading,
       incorrect or inadequate documentation supplied by the Executive,

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<PAGE>   6
       the Executive shall be liable to the Company for the amount of such
       excess reimbursement.

9.     INDEMNIFICATION

       The Company has an obligation to indemnify Executive for general
       directors and/or officers liability in the normal course of Executive's
       services on Company business, but shall limit the indemnification
       provided hereunder to the indemnification provided in accordance with the
       terms and conditions of the indemnification provisions allowed by law,
       and consistent with the provisions of an insurance coverage as the
       Company has secured for this purpose. The use of the standards applicable
       under the Company's insurance coverage or policy shall not, however,
       limit the obligation of the Company to indemnify the Executive for claims
       or expenses either below the annual or periodic deductible limit in the
       policy or in excess of the policy limits.

       The Company shall be obligated to pay the claims or expenses of the
       Executive required under this Section 9, including defence cost, directly
       to the third party to whom payment is due and owing, without the
       necessity of the Executive making such payment and seeking reimbursement
       from the Company.

       Indemnification for the Executive shall only be permitted if the
       Executive, in connection with the action, suit of proceeding subject to
       indemnification, acted in good faith and in a manner the Executive and
       the Board would normally have reasonably believed to be in or not opposed
       to the best interests of the Company, and, with respect to any criminal
       action or proceeding, the Executive had no reasonable cause to believe
       the Executive's conduct was unlawful. To the extent that the Executive is
       successful on the merits or otherwise in defence of any action, suit, or
       proceeding, or in defence of any claim, issue or matter brought against
       the Executive, the Executive shall be indemnified by the Company against
       all expenses, including defence and legal fees, reasonable incurred by
       the Executive.

       The provisions of this Section 9 shall survive the termination or
       expiration of Executive's employment under this Agreement irrespective of
       the reason for such termination, provided that nothing herein shall be
       construed to provide Executive with any greater coverage or coverage for
       any period longer than Executive would have been entitled to receive
       under the terms of such insurance policy referred to herein (other than
       deductible and policy dollar limits).

10.    TERMINATION OF EMPLOYMENT

10.1   TERMINATION BY THE COMPANY FOR CAUSE

       In the event that Executive is removed from office by the Company for
       cause (as hereinafter defined), the employment of Executive under this
       Agreement shall terminate and Executive shall be entitled to receive only
       the monthly Base Salary for the period to the date of such removal.

       No other or further payment of benefits under this Agreement will be due
       upon Termination for Cause, except as required by law, or under the
       Company's insurance and other employee benefit plans and the procedures
       referred to in Sections 6 and 8.


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<PAGE>   7
10.2   DEFINITION OF CAUSE

       For purposes of this Agreement, the term "cause" shall mean (i) any
       wilful material neglect by Executive, or material failure by Executive to
       perform the duties and responsibilities of the Executive's office or
       offices (other than any such failures resulting from Executive's
       incapacity due to illness or injury), or (ii) any malfeasance or gross
       misconduct by Executive in connection with the performance of any of the
       duties or responsibilities or otherwise which would, in the view of a
       reasonable person, be materially prejudicial to the interests of the
       Company or any of its affiliates if Executive were retained in the
       respective office or offices, including without limitation, conviction of
       a felony, or (iii) actual indictment for, or formal admission to a felony
       or crime of moral turpitude, dishonesty, breach of trust or unethical
       business conduct or any crime involving the Company, or (iv) repeated
       material failure to adhere to the policies and directions of the Board of
       Directors, or failure to devote all of Executive's business time and
       efforts to the business of the Company and the duties and
       responsibilities hereunder, and with respect to 10.2.(i) or 10.2.(ii) or
       10.2.(iv) herein, there has been a failure to cure such breach or a
       failure to modify Executive's conduct within 30 days of receiving written
       notice of such breach specifying the factual reasons supporting the
       proposed dismissal for cause.

10.3   DETERMINATION OF FOR CAUSE TERMINATION

       A determination of a for cause termination shall be made by the Company
       as follows:

       (a)    The Chairman of the Sage Group Limited and the Chairman of the
              Company shall first make a preliminary determination that the
              Executive should be reviewed for discharge for cause. The Company
              will not be required to provide any preliminary notice to the
              Executive of its intention to investigate the possible discharge
              of the Executive for cause.

       (b)    After investigating the circumstances surrounding the possible for
              cause termination of the Executive, the Company, through its
              Chairman, may immediately relieve or suspend the Executive from
              the Executive's by providing notice to the Executive. Upon notice
              of the suspension, the Executive shall immediately vacate the
              premises and remove all personal property from the premises of the
              Company. The Company shall have the absolute right to review any
              and all material in the possession of the Executive on the Company
              premises to determine those items, which are proprietary to the
              Company. After sorting the appropriate items, all personal items
              shall be delivered to the Executive at the location designation
              reasonably selected by the Executive.

       (c)    After concluding its investigation, the Company, through the
              Chairman of the Sage Group Limited and the Chairman of the
              Company, shall make a determination whether the Executive should
              be discharged for cause. The determination for discharge for cause
              shall be timely communicated in writing, to the Executive.


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<PAGE>   8
10.4   TERMINATION BY THE COMPANY WITHOUT CAUSE

       The Company expressly reserves the right to terminate the employment, or
       materially reduce the responsibilities, of Executive at any time for no
       reason or for any reason.

       In the event that Executive's employment is so terminated or altered
       under this Section, Executive shall be entitled to receive:

       a)     Twenty four (24) monthly payments of the current monthly Base
              Salary, paid pursuant to the Company's normal payroll practices;
              and,

       b)     A proportionate bonus based on the most recent annual payment
              under the short term incentive plan, for the months of service
              since such previous annual payment was earned.

       In addition to the above payments if permitted under the appropriate plan
       documentation and if allowed by law, all health, dental and life
       insurance coverage provided to Executive under the employee benefit plans
       will be extended for such period as the Company is obligated to make
       monthly Base Salary payments to Executive in terms of this Section,
       unless Executive becomes covered by other employer plans. If coverage
       extensions are not permitted by law or under the plans, the Company shall
       pay to the Executive periodic bonuses equal to the insurance premium cost
       which would have been required as if the Executive were covered under the
       plan.

       Any unvested employer contributions attributable to Executive under any
       pension plan, shall be accelerated and deemed vested as of the date of
       termination of employment without cause. If the acceleration of vesting
       is not permitted by law or under the terms of the plan, the Company
       shall, in lieu of accelerated vesting, pay a bonus to the Executive in
       the amount of the account forfeiture under the plan.

       Any unvested allocations or options granted to Executive under the terms
       of the Long Term Capital Incentive Compensation Plan shall be treated in
       the same manner as a retirement under the rules of the Plan.

10.5   COMPULSORY RELOCATION FOLLOWING A CHANGE OF CONTROL

       If the Sage Group Limited should cease to have effective control of the
       Company, and during the subsequent twenty four (24) months the effective
       place of business of the Company is changed by its new controlling
       shareholders such that the Executive would, in the view of a reasonable
       man, have to relocate to effectively continue his responsibilities, then
       Executive shall elect in writing to (i) agree to work from such new
       premises, undertaking if so desired by Executive a relocation paid for by
       the Company in terms of its policy for executive relocations; or, (ii)
       upon giving 90 days written notice to the Company, terminate his
       employment for cause and receive the payments provided for under Section
       10.4 above.

10.6   VOLUNTARY TERMINATION BY THE EXECUTIVE

       Executive shall be entitled, with not less than three (3) month's written
       notice, to voluntarily terminate employment with the Company. If
       Executive elects such termination, Executive shall be entitled to receive
       the Executive's monthly Base

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<PAGE>   9
       Salary defined under Section 3 and benefits defined under Section 6 until
       the end of such notice period. Executive shall also be entitled to
       exercise any vested rights under Sections 4, 6 and 7.

       Even though the Executive is required to give not less than three (3)
       months advance written notice, the Company shall have the option to
       require that the Executive discontinue service on behalf of the Company
       at any time upon receipt of advance written notice of the Executive's
       election to terminate; provided, however, that in such event the Company
       shall be required to continue the Base Salary and benefit payments
       through the three (3) month notice period.

10.7   DISABILITY TERMINATION

       The Executive's employment shall terminate if the Executive becomes so
       disabled as to be unable to perform the services of character
       contemplated by this Agreement, and such disability continues for a
       period of ninety (90) consecutive days. The Executive's employment shall
       terminate at the conclusion of the 90-consecutive day disability. In such
       event, the Executive shall be entitled to receive the Executive's monthly
       Base Salary defined under Section 3 and benefits defined under Section 6
       until the end of the 90-consecutive day disability period. At the end of
       the 90-consecutive day disability period, Executive shall be entitled to
       a proportionate bonus based on the most recent annual payment under the
       short term incentive plan, for the months of service until disablement
       since such previous annual payment was earned. Executive shall also be
       entitled to exercise any vested rights under Sections 4, 6 and 7.

       For purposes of this Agreement the term "disability" or "disabled" shall
       mean a physical or mental condition resulting in a bodily injury or
       disease or mental disorder which renders the Executive incapable of
       engaging in substantial gainful activity of the character contemplated by
       this Agreement and which can be expected to be of a long and continued
       duration. The disability of the Executive shall be determined by the
       Board based upon competent medical authority. The determination of a
       disability may be made by the Board independent of such determination
       being made under any other disability insurance plan sponsored or funded
       by the Company.

10.8   TERMINATION DUE TO EXECUTIVE'S DEATH

       This Agreement shall terminate if the Executive shall die, in which event
       the Executive's estate or personal representative shall not be entitled
       to continue to receive Base Salary payments permitted under Section 3 or
       other benefits permitted under this Agreement, other than the monthly
       Base Salary for the period until death and those benefit continuation
       requirement imposed as a matter of law. With respect to other benefit
       entitlement under the Long Term Incentive Plan, bonus plan or other
       similar plans, the Executive's estate shall only be permitted to such
       rights or benefits as otherwise provided in those plan documents. The
       Executive's estate shall be entitled to a proportionate sum based on the
       most recent annual payment to the deceased Executive under the short term
       incentive plan, for the months of service until death since such previous
       annual payment was earned.


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<PAGE>   10
11.    RESTRICTIVE CONVENANTS; CONFIDENTIALITY; OWNERSHIP OF PROCEEDS OF
       EMPLOYMENT

11.1   SOLICITATION OF EMPLOYEES; CUSTOMERS; AGENTS OR REPRESENTATIVES ETC.

       Executive agrees that, during the term of employment hereunder, and for a
       period of two (2) year after the Company no longer employs Executive,
       Executive shall not, directly or indirectly:

       (a)    solicit, entice, persuade or induce any individual who is then or
              has been within the preceding six-month period, an employee of the
              Company or any of its subsidiaries or affiliates, to terminate his
              or her employment with the Company or any of its subsidiaries or
              affiliates, or to become employed by or enter into contractual
              relations with any other individual or entity, and the Executive
              shall not approach any such employee for any such purpose or
              authorize or knowingly approve the taking of any such actions by
              any other individual or entity; or,

       (b)    except in accordance with Executive's duties hereunder, solicit,
              entice, persuade or induce any individual or entity which is then,
              or has within the preceding twelve month period been, a customer,
              distributor or supplier, or policy owner, agent or representative
              of the Company or its subsidiaries or affiliates to terminate or
              materially reduce his, her or its contractual or other
              relationship with the Company or any of its subsidiaries or
              affiliates, and the Executive shall not approach any such
              customer, distributor, supplier, policy owner, agent or
              representative for such purpose or authorize or knowingly approve
              the taking of any such actions by any other individual or entity.

       (c)    For purposes of this Agreement, where the Executive has been
              Terminated without Cause under Section 10.4, such restrictive
              period of one (1) year shall extend, if later, until the end of
              monthly payments under Section 10.4.

11.2   CONFIDENTIAL RECORDS

       In the course of employment, Executive will have access to confidential
       information, records, data, specifications, and other knowledge owned by
       the Company or its subsidiaries or affiliates. Executive agrees that at
       no time during or after the term of employment shall the Executive remove
       or cause to be removed from the premises of the Company or its
       subsidiaries or affiliates, any record, file, memorandum, document,
       equipment or like item relating to the business of the Company or its
       subsidiaries or affiliates except in furtherance of Executive's duties
       hereunder, and immediately following the termination of Executive's
       employment hereunder or at any other time at the request of the Board of
       Directors, all such records, files, memoranda, documents, equipment and
       like items then in Executive's possession will promptly be returned to
       the Company. Executive further agrees that, during and after the term of
       employment, Executive shall not without the written consent of the
       Company or a person authorized thereby, disclose to any person, other
       than an employee of the Company its subsidiaries or affiliates or a
       person to whom disclosure is reasonably necessary or appropriate in
       connection with the performance by Executive of duties as an executive of
       the Company, any confidential information

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<PAGE>   11
       obtained by Executive while in the employ of the Company with respect to
       any business methods, plans, policies, products and/or personnel of the
       Company or its subsidiaries or affiliates, the disclosure, including
       speaking with the press, of which would, in the view of a reasonable
       person, be injurious or damaging to the business of the Company or its
       subsidiaries, or affiliates, provided, however, that confidential
       information shall not include any information known generally to the
       public (other than as a result of unauthorized disclosure by Executive),
       or any information of a type not otherwise considered confidential by
       persons engaged in the same business or a business similar to that
       conducted by the Company.

11.3   OWNERSHIP OF PROCEEDS OF EMPLOYMENT

       Executive acknowledges that the Company shall be the sole owner of all
       the fruits and proceeds of the Executive's services hereunder, including
       without limitation all ideas, concepts, formats, suggestions,
       developments, arrangements, designs, packages, programs, promotions and
       other properties relating to the businesses of the Company, which
       Executive may create in connection with and during the term of employment
       hereunder, free and clear of any claims by the Executive of any kind or
       character whatsoever (other than Executive's right to compensation and
       benefits hereunder).

11.4   SURVIVAL

       The provisions of this Section 11 shall survive any termination or
       expiration of Executive's employment under this Agreement, irrespective
       of the reason therefore.

11.5   ENFORCEABILITY; REMEDIES

       The parties hereto agree that a breach by Executive of any of the
       provisions of Section 11. hereof will cause the Company great and
       irreparable injury and damage. By reason of this, Executive acknowledges
       that, in the event of a breach by Executive of any of the provisions of
       Section 11 hereof, the Company shall be entitled, in addition and as a
       supplement to any other rights or remedies it may have at law, to the
       remedies of injunction, specific performance and other equitable relief.
       This section 11 shall not, however, be construed as a waiver of any of
       the rights which the Company may have for damages or otherwise.

12.    MISCELLANEOUS PROVISIONS

12.1   SEVERABILITY

       Executive acknowledges and agrees that (i) Executive has had an
       opportunity to seek advice of counsel in connection with this agreement
       and (ii) the Restrictive Covenants are reasonable in temporal and
       geographic scope and in all other respects. If in any jurisdiction any
       term or provision hereof is determined to be invalid or unenforceable,
       (a) the remaining terms and provisions hereof shall be unimpaired, (b)
       any such invalidity or unenforceability in any jurisdiction shall not
       invalidate or render unenforceable such provision in any other
       jurisdiction, and the remaining provisions hereof shall be given full
       force and effect without regard to the invalid portions. The Employer and
       the Executive intend to and hereby confer jurisdiction to endorse the


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<PAGE>   12
       Restrictive Covenants upon the Courts of any jurisdiction within the
       geographical scope of the covenants.

12.2   EXECUTION IN COUNTERPARTS

       This Agreement may be executed in one or more counterparts, and by the
       different parties hereto in separate counterparts, each of which shall be
       deemed to be an original but all of which taken together shall constitute
       one and the same agreement (and all signatures need not appear on any one
       counterpart),and this Agreement shall become effective when one or more
       counterparts has been signed by each of the parties hereto and delivered
       to each of the other parties hereto.

12.3   NOTICES

       Any notice or other communication in connection with this Agreement shall
       be deemed to be delivered if in writing (or in the form of a fax)
       addressed as provided below and if either (a) actually delivered at said
       address, or (b) in the case of a letter, three business days shall have
       elapsed after the same shall have been deposited in the US mail, postage
       prepaid and registered or certified, and (c) in the case of fax, one
       business day shall have elapsed after dispatch.

       If to the Company, to it at the following address:

                           Sage Life Assurance of America, Inc.
                           300 Atlantic Street
                           Suite 302
                           Stamford
                           CONNECTICUT 06901
                           FAX (203) 324-6173
                           Attention:  Chairman of the Board

       with a copy to:

                           Robert J Kiggins
                           Secretary, Sage Insurance Group Inc.
                           c/o McCarthy Fingar, Donovan & Partners
                           11 Martine Avenue, 12th Floor
                           WHITE PLAINS NY 10606-0134
                           FAX (914) 946-0134

                           H. Louis Shill
                           Chairman: Sage Group Limited
                           10 Fraser Street
                           JOHANNESBURG, 2000, SOUTH AFRICA
                           FAX (0112711) 834-1910

       or at such other address as the Company shall have specified by written
       notice actually received by the addresser.


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<PAGE>   13
       If to Executive, to Executive at the address provided in the preamble or
       at such other address as Executive shall have specified by written notice
       actually received by the addresser.

12.4   ENTIRE AGREEMENT AND SUBSEQUENT AMENDMENTS

       This Agreement constitutes the entire agreement between the Company and
       Executive relating to Executive's employment and supersedes all prior
       agreements and understandings of the parties hereto, whether oral or
       written with respect to the subject matter herein.

       This Agreement may be amended or altered only by the written agreement of
       the Company and Executive.

12.5   APPLICABLE LAW

       This Agreement shall be governed by and construed in accordance with the
       laws of the State of Connecticut without regard to principles of conflict
       of law.

12.6   HEADINGS

       The descriptive headings of the several sections of this Agreement are
       inserted for the sole purpose of convenience of reference, and do not
       constitute part of this Agreement or in any way limit or affect the
       meaning or interpretation of any of the terms or provisions of this
       Agreement.

12.7   BINDING EFFECT; SUCCESSORS AND ASSIGNS

       This Agreement shall be binding upon and shall inure to the benefit of:

       (a)    the Company and its successors and assigns; and

       (b)    Executive and to the benefit of Executive's heirs, executors,
              administrators and legal representatives. Executive's duties and
              obligations hereunder are personal and shall not be assignable or
              delegable in any manner whatsoever.

       The Company may assign the obligations under this Agreement (subject to a
       right of recourse by Executive to the Company in the event of any default
       under the obligations to Executive hereunder), to an affiliate or to any
       intermediate parent of the Company.

12.8   WAIVER

       The failure of either of the parties hereto at any time, to enforce any
       of the provisions of this agreement shall not be deemed or construed to
       be a waiver of any such provision, nor to in any way affect the validity
       of this agreement or any provision hereof or the right of either of the
       parties hereto, to thereafter enforce each and every provision of this
       Agreement. No waiver of any breach of any of the provisions of this
       Agreement shall be effective unless set forth in a written instrument
       executed by the party against whom or which enforcement of such waiver is
       sought, and no waiver of

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       any such breach shall be construed or deemed to be a waiver of any other
       or subsequent breach.

12.9   WARRANTY AND CAPACITY TO CONTRACT

       The Company and Executive hereby represent and warrant to the other that:

       (a)    they have full power and authority to execute this Agreement, and
              to perform their respective obligations hereunder;

       (b)    such execution, delivery and performance will not (and with the
              giving of notice or lapse of time or both would not) result in any
              breach of any agreements or other obligations to which Executive
              or the Company is otherwise bound; and

       (c)    this Agreement is a valid binding obligation on Executive and the
              Company.

12.10  ARBITRATION

       Except to the extent necessary for Executive or the Company to enforce
       rights under Section 12.9 above or for the Company to enforce its rights
       under Section 11 above, any case or controversy arising among the parties
       hereto under this Agreement, or the subject matter hereof, shall be
       settled by binding arbitration in Stamford, Connecticut under the then
       prevailing rules of the American Arbitration Association. The decision of
       the arbitrators shall be final and binding and the party against whom the
       award is rendered ("the non-prevailing party") shall be specifically
       instructed in any such award to pay all reasonable attorney's fees,
       disbursements of the prevailing party's legal counsel, arbitration costs,
       expenses and filing fees incurred by the prevailing party in the
       arbitration proceeding. The American Arbitration Association shall
       appoint three (3) arbitrators to preside at the said arbitration
       proceeding and the arbitrators will determine in their decision and
       award, which is the prevailing party, which is the non-prevailing party,
       the amount of the fees and expenses of the prevailing party and the
       amount of the arbitration expenses. The arbitrators will render their
       award, upon the concurrence of at least two (2) of their number, no later
       than thirty (30) days after the conclusion of the arbitration
       proceedings. Judgment may be entered on the award of the arbitrators and
       may be enforced in any court of competent jurisdiction.

12.11  REMEDIES

       All remedies hereunder are cumulative, are in addition to any other
       remedies provided by law and may be exercised concurrently or separately,
       and the exercise of any one remedy shall not be deemed to be an election
       of such remedy exclusively or to preclude the exercise of any other
       remedy. No failure or delay in exercising any right or remedy shall
       operate as a waiver thereof or modify the terms of this Agreement.

12.12  SURVIVAL

       Anything contained in this Agreement to the contrary notwithstanding, the
       provisions of Section 10; and Section 11; and Section 12.1; and the other
       provisions of this Section 12 (to the extent necessary to effectuate the
       survival of Section 12) shall

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<PAGE>   15
       survive termination of this Agreement and any termination of Executive's
       contract hereunder.

IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the date first written above.

BY ROBIN I. MARSDEN ("Executive")


Executed at __________________________________ on___________________ 2000



____________________________________
ROBIN I. MARSDEN

BY SAGE GROUP LIMITED, ULTIMATE CONTROLLING SHAREHOLDER OF THE COMPANY.

Executed at __________________________________ on___________________ 2000



____________________________________
CHAIRMAN: H. LOUIS SHILL




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<PAGE>   16
                        EXHIBIT A - POSITION DESCRIPTION




TITLES:           President & Chief Executive Officer: Sage Life Assurance of
                  America, Inc.

                  President & Chief Executive Officer: Sage Insurance Group,
                  Inc.

                  Chief Executive Officer: Sage Life (Bermuda) Limited

                  President & Chief Executive Officer: Sage Life Investment
                  Trust

                  President & Chief Executive Officer: Sage Life Assurance
                  Company of New York

REPORTING LINES:  Chairman and Board of Directors: Sage Group Limited and Sage
                  Life Holdings Limited (South Africa)

                  Chairman and Board of Directors: all companies ran by
                  Executive with non-executive board members (currently Sage
                  Life Assurance of America, Inc., Sage Insurance Group, Inc.,
                  Sage Life Investment Trust & Sage Life Assurance Company of
                  New York)

RESPONSIBILITIES AND DUTIES WITH REGARD TO COMPANIES MANAGED BY EXECUTIVE

       -      Formulating and implementing agreed strategic direction and
              business plans

       -      Managing and motivating executives and staff

       -      Co-ordinating liaison with Sage South Africa

       -      Co-ordinating liaison with Swiss Re Life & Health (North America)
              and other strategic partners of companies referred to above




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                  EXHIBIT B - TERMS OF LONG TERM INCENTIVE PLAN

1.     Sage Insurance Group Inc. (SIGI) to be recapitalized at March 31, 2000,
       to reflect capitalized costs of establishing business (including
       permanent investments, acquisition costs, development costs, operating
       costs and lost interest).

2.     Minimum of 10% equity participation for management and staff in SIGI.
       Minimum of 6% of initial capitalization to founding executives: Ron
       Scowby, Robin Marsden and Mitch Katcher.

3.     Founding executives:

       3.1.   Allocated founding 6% options over two years from April 1, 1999,
              initial allocation to be 4% (split to be notified), followed by 2%
              balance in April 1, 2000.

       3.2.   Strike price on all (founding) options to be set at "ground floor"
              price (i.e., Sage Group Limited's investment to establish and
              capitalize operation, including expenses written off and lost
              interest - audited by Ernst & Young).

       3.3.   Initial 4% allocation starts to vest from March 31, 2000 over a
              five year period (in recognition of past service), i.e., 20%
              vesting per year, subsequent 2% allocation starts to vest 2 years
              after allocation over a five year period.

4.     Grants to other staff at strike price based on fair market value of
       company, as determined by the external auditors , at the time (but no
       less than "ground floor" price used for founding executives), begin
       vesting two years after grant over a five year period, i.e., 20% vesting
       per year.

5.     Exercising options

       5.1.   Five years to exercise options from date of full and final
              vesting, i.e., ten years to exercise from first vesting;

       5.2.   Partial or whole exercise of vested options at any time before end
              of this period.

       5.3.   A minimum of 50% of shares can be put to the controlling
              shareholder at fair market value at end of the tenth year from
              when first employed if there is no readily available market for
              the shares, balance of 50% to be considered by controlling
              shareholder on case-by-case basis.

       5.4.   Special vesting/exercising rights attach in event of death,
              disability or retirement:

              a.     death: if (1) SIGI still private company, beneficiaries
                     vest immediately and have up to three years to exercise
                     options partially or in full; if (2) SIGI is a public
                     company, beneficiaries vest immediately and have up to one
                     year to exercise options partially or in full. Shares held
                     under alternative convertible debenture plan can continue
                     to vest in terms of plan schedule,

              b.     disability and retirement: immediate vesting and right to
                     exercise options immediately or over five years (or balance
                     of exercise period on options already vested at that time),

              c.     beneficiary can request company's board to consider
                     alternative arrangements, board will not unreasonably deny
                     request unless it would be detrimental to the company.

6.     External auditors will determine fair market value where no readily
       available market value.

7.     Alternative convertible debenture plan to be elected within one year of
       grant


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<PAGE>   18
       7.1.   Company advances loan to participants to fund purchase of
              convertible debentures. Debentures convert on same basis as stock
              options. Unlike options, conversion (equivalent to option
              exercise) is not currently taxable, final disposal of the
              resulting stock would currently be subject to normal capital gains
              tax rules.

       7.2.   Interest paid on loan by employee at official tax rate.

       7.3.   Interest paid on convertible debentures by company at official tax
              rate.

8.     Initial grants will be in options (or convertible debentures if so
       selected by the participant). When additional capital is introduced into
       SIGI, participants under the long term incentive plan will be afforded
       the opportunity to obtain additional convertible debentures to maintain
       their percentage interest in the company held under the long term
       incentive plan. The company will provide financing described under 7. to
       participants electing to take up the additional convertible debentures.




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<PAGE>   19
                              EXHIBIT C - BENEFITS

MAJOR MEDICAL - provided by Oxford Health Plans - non-gatekeeper plan - company
pays 75% - employee pays 25% - plan premiums are currently age-based

DENTAL - provided by Guardian Dental Plans - company pays 75% - employee pays
25%

VISION PLAN - US Life - company paid - covers all family members. Covers eye
exam every 2 years and eyeware allowance of $125.00 -

LIFE INSURANCE - 3x annual base salary, paid for by company. First $300,000
currently provided under US Life group policy. Balance provided in the form of
individual policy from Northwestern Mutual Life.

RETIREMENT PLAN - 10.5% company contribution of base annual salary to IRS cap of
considered compensation of $170,000 (or such other compensation limit
established by the IRS). 1 year waiting period - 3 yr. 100% vesting (Principal -
17 Investment Options). 10.5% company contribution on base annual salary in
excess IRS compensation cap - paid into deferred compensation plan (Rabbi
trust), investments self directed through deferred compensation Schwab account.

401(k) SAVINGS - can defer up to IRS cap of $10,500 - no company match.
(Principal - 17 Investment Options)

SHORT TERM DISABILITY - 90 day salary continuance - paid for by the company.

LONG TERM DISABILITY - 90 day elimination period - 70% of base monthly salary to
maximum benefit of $10,000 per month. (Northwestern Mutual Life)

VACATION LEAVE - Officers of company - 4 weeks per annum - accrued monthly -
carry-forwards allowed for extended leave or cash-out. Required to take minimum
of 2 weeks per annum.

CASUAL ABSENCE - 6 days per annum for personal business or casual illness -
accrued monthly - carry forwards allowed

HOLIDAYS - 10 paid holidays per annum - included 1 Floating Holiday to be taken
at the employee's choice

PARKING - Company paid.


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