Exhibit 10(p)


                        AUTO PHYSICAL DAMAGE CATASTROPHE
                      EXCESS OF LOSS REINSURANCE AGREEMENT

                              FINAL PLACEMENT SLIP
                              --------------------



COMPANY:       21st Century Insurance Company
               a California corporation
               21st Century Casualty Company
               a California corporation
               21st Century Insurance Company of Arizona
               an Arizona corporation
               and any and all insurance companies 50% or more owned by, or
               which hereafter come under the same ownership or management of,
               21st Century Insurance Group.

TERM:          Losses occurring during the 16-month term extending from 12:01
               a.m. Pacific Time on September 1, 2002, to 12:01 a.m. Pacific
               Time on January 1, 2004.

               Should this Agreement expire while a loss occurrence covered
               hereunder is in progress, the Reinsurers will be responsible for
               their portion of the entire loss or damage caused by such loss
               occurrence, subject to the other conditions of this Agreement,
               and provided that no part of said loss occurrence is claimed
               against any renewal or replacement of this Agreement.

BUSINESS
COVERED:       All business classified by the Company as Auto Physical Damage
               (Comprehensive only) and any business the Company is required to
               write by reason of its participation in any Fair Plan.

TERRITORY:     Arizona, California, Nevada, Oregon, Washington and all extra
               territorial limits as provided for in the Company's policies.

EXCLUSIONS:    As per attached.

RETENTION
AND LIMIT:     $30,000,000 Ultimate Net Loss each loss occurrence excess of
               $15,000,000 Ultimate Net Loss each loss occurrence.

WARRANTY:      The Company will retain a minimum of 2.50% of the limit hereon
               net and unreinsured.

REINSTATEMENT: One full reinstatement with additional premium, 100% as to time,
               pro rata as to amount. Paid at the same time the Reinsurers pay
               the loss.


                                                                              25
<PAGE>
PREMIUM:       Deposit premium of $1,800,000 payable in equal installments of
               $360,000 in advance at September 1, 2002, January 1, 2003, April
               1, 2003, July 1, 2003, and October l, 2003. To be adjusted at
               Agreement expiration at a rate of 1.43% against Gross Net Earned
               Premium, subject to a minimum premium of $1,620,000. Adjustment
               against minimum and deposit as soon as practicable following the
               expiration of the Agreement.

               "Gross Net Earned Premium" as used herein will mean the Company's
               gross premium earned less earned premium paid for reinsurances,
               recoveries under which would inure to the benefit of the
               Reinsurer.

LOSS EXPENSE:  Included within Ultimate Net Loss.

OTHER
REINSURANCE:   The Company is permitted to purchase facultative and other treaty
               reinsurance (including other Catastrophe Reinsurance), and the
               premium for any such reinsurance that inures to the benefit of
               this Agreement will not be included within the subject premium
               hereunder.

GENERAL
CONDITIONS:    Reinsurers will be subject to the same terms, conditions,
               interpretations, waivers, modifications, and alterations as the
               respective policies of the Company to which this Agreement
               applies.

               Reserve Deposit Clause (Non-Admitted Reinsurers) - as attached
               Net Retained Lines Clause - as attached
               Loss Occurrence Clause - as attached
               Ultimate Net Loss Clause - as attached
               ECO 80%; XPL 80% (Subject to 25% of UNL.)
               Notice of Loss and Loss Settlements Clause- as attached
               Insolvency Clause
               Entire Agreement, Interpretation Clause - as attached
               Service of Suit Clause (U.S.A.) - N.M.A. 1998
               Agency Clause
               Special Termination or Settlement Clause - as attached
               Confidentiality Clause - as attached
               Taxes Clause
               Currency Clause
               Access to Records Clause - as attached
               Delays, Errors or Omissions Clause
               Arbitration Clause
               Federal Excise Tax Clause
               Extended Expiration Clause
               Aon Re Inc. Intermediary clause

ALLOCATION
OF SHARES:     The Company shall have the right to review all authorizations and
               the full authority to allocate final shares. Such decisions will
               be at the sole discretion of the Company and may result in other
               than a "proportional sign-down" of authorizations. As respects
               sign-downs within the London marketplace, the final allocation of
               shares to individual companies or syndicates may not be
               proportionate to the original authorizations.


                                                                              26
<PAGE>
INFORMATION:   Estimated Subject Gross Net Earned Premium Income: $125,800,000.
               Information package provided.

In  accordance  with  your  instructions,  we  have  placed reinsurance with the
Reinsurers  listed  hereon,  subject  to  the  terms  and conditions hereinabove
stated.  We  ask  that  you  promptly  advise  us  if  the terms, conditions, or
Reinsurers  vary  in any respect from your instructions. Aon Re Inc. will not be
responsible for the financial or other obligations of any Reinsurers. Should you
desire  financial  information  regarding  the  Reinsurers listed hereon, please
contact  us  and  we  will  furnish  it.

The  Reinsurer's  obligations under this Agreement are several and not joint and
are  limited  solely  to  the  extent  of  their  individual participations. The
Reinsurers  are  not  responsible  for  the  participation of any co-subscribing
Reinsurer  who  for  any reason does not satisfy all or part of its obligations.


REINSURED WITH:
---------------

COMPANY NAME                        NAIC#    FEIN#       LAYER 1
------------                       ------  ----------  ---------
Domestic Companies
Folksamerica Reinsurance Company    38776  13-2997499   6.66666%
Transatlantic Reinsurance Company   19453  13-5616275  16.66667%
Total Domestic Companies                               23.33333%

Non-Domestic Companies
Endurance Specialty Insurance Ltd.         AA-3194130  16.66667%

TOTAL ALL PARTICIPANTS                                 40.00000%

Assuming that you find everything in order, please indicate your acceptance and
approval by signing and returning this Final Placement Slip to Aon Re Inc.


ACCEPTED
& APPROVED:    /s/ Douglas K. Howell
             -------------------------------------------------------------------

REFERENCE
NUMBER:       09021203 CATCOMP                  DATED:     9-26-02
             ------------------------                   ------------------------

(FOR PROCESSING PURPOSES IT IS IMPORTANT THAT YOU PROVIDE YOUR COMPANY'S
REFERENCE NUMBER FOR THIS PROGRAM.)


                                                                              27
<PAGE>
                                   EXCLUSIONS
                                   ----------

This Agreement does not apply to and specifically excludes the following:

A.   Liability  assumed  by  the  Company  under any form of treaty reinsurance;
     however,  group  intra-company  reinsurance  (if  applicable), local agency
     reinsurance  accepted  in  the  normal  course  of business and/or policies
     written  by  another carrier at the Company's request and reinsured 100% by
     the  Company  will  not  be  excluded  hereunder.

B.   Financial  Guarantee  and  Insolvency  coverages  and/or  similar coverage,
     however  styled.

C.   Loss  or  damage  occasioned by war, invasion, hostilities, acts of foreign
     enemies,  civil  war,  rebellion,  insurrection, military or usurped power,
     martial  law,  or  confiscation  by  order  of  any  government  or  public
     authority;  however,  the  foregoing  will  not apply to reinsured policies
     containing  a  standard  war  exclusion  clause.

D.   Loss  or  liability  excluded  by  the  Pools,  Associations and Syndicates
     Exclusion  Clause.

E.   Loss or liability  excluded  by  the  Insolvency  Funds Exclusion Clause.

F.   Loss  or  liability  excluded  by the Nuclear Incident Exclusion Clauses --
     Physical  Damage-  Reinsurance,  U.S.A. and Canada and Nuclear Energy Risks
     Exclusion  Clause  (Reinsurance)  (1994)  (Worldwide  -  Excluding U.S.A. &
     Canada)  attached  to  this  Agreement.

G.   Any  of  the  following:

     1.   Bodily Injury
     2.   Property Damage Liability
     3.   Medical Payments
     4.   UIM.
     5.   Collision

H.   Commercial Auto.

I.   Notwithstanding  any  provision  to  the  contrary  within this reinsurance
     agreement  or  any  endorsement thereto, it is agreed that this reinsurance
     agreement  excludes  loss,  damage, cost, or expense directly or indirectly
     caused  by,  contributed  to  by,  resulting  from, or arising out of or in
     connection  with any act of terrorism, as defined herein, regardless of any
     other  cause or event contributing concurrently or in any other sequence to
     the  loss.

     An  act of terrorism includes any act, or preparation in respect of action,
     or  threat  of  action  designed  to influence the government de jure or de
     facto  of  any  nation  or any political division thereof, or in pursuit of
     political,  religious,  ideological,  or similar purposes to intimidate the
     public  or  a section of the public of any nation by any person or group(s)
     of  persons  whether acting alone or on behalf of or in connection with any
     organization(s)  or  government(s)  de  jure  or  de  facto,  and  which:

     (i)    involves  violence  against  one  or  more  persons;  or
     (ii)   involves  damage  to  property;  or
     (iii)  endangers  life other than that of the person committing the action;
            or
     (iv)   creates  a  risk to health or safety of the public or a section of
            the public;  or
     (v)    is designed to interfere  with  or to disrupt an electronic system.

     This  reinsurance  agreement  also  excludes loss, damage, cost, or expense
     directly  or  indirectly  caused  by, contributed to by, resulting from, or
     arising out of or in connection with any action in controlling, preventing,
     suppressing, retaliating against,  or responding to any act of terrorism.


                                                                              28
<PAGE>
     Notwithstanding  the  above and subject otherwise to the terms, conditions,
     and  limitations of this reinsurance agreement, in respect only of personal
     lines  this  reinsurance  agreement will pay actual loss or damage (but not
     related  cost  or expense) caused by any act of terrorism provided such act
     is not directly or indirectly caused by, contributed to by, resulting from,
     or  arising  out  of or in connection with biological, chemical, or nuclear
     pollution  or  contamination.

     This  exclusion  shall  not  apply,  however,  to  any  act  that  has been
     determined  not  to  be terrorism by the government of the United States or
     other  applicable  governmental  authority.

J.   This  Agreement  excludes  any  loss,  damage,  costs  or  expenses related
     thereto,  which  are  occasioned  by  or  in  consequence  of,  directly or
     indirectly,  or  result  from  the  dispersal,  release,  escape,  growth,
     infestation,  contamination,  or  exposure  to  the  following:

     1.   Mold, defined as any form of multicellular fungi that live on plant or
          animal  matter and in indoor environments, toxic mold and mold spores.
          Indoor  environments  will  include  the  affected  dwelling  unit  or
          affected  commercial  or  industrial  building;
     2.   Fungus,  mildew  and  bacteria;  and
     3.   Bioaerosols,  defined  as  toxic  airborne  particles related to mold.

     The Company may submit in writing to the Reinsurers, for special acceptance
     hereunder,  business  not  covered  by  this Agreement. If said business is
     accepted  in  writing by the Reinsurers, it will be subject to the terms of
     this  Agreement,  except as such terms are modified by such acceptance. Any
     special  acceptance  business covered under the reinsurance agreement being
     replaced  by  this  Agreement  will  be  automatically  covered  hereunder.
     Further,  should  Reinsurers become a party to this Agreement subsequent to
     the  acceptance  of  any business not normally covered hereunder, they will
     automatically  accept  same  as  being  part  of  this  Agreement.

     Should  any judicial entity having jurisdiction invalidate any exclusion in
     the  Company's  policy  that  is  also  the  subject  of one or more of the
     exclusions herein, then subject to the limits of this Agreement, a loss for
     which  the  Company  is  liable  because  of  such invalidation will not be
     excluded  hereunder.

                    RESERVE DEPOSIT (NON-ADMITTED REINSURERS)
                    -----------------------------------------

A.   With respect to any jurisdiction in which a ceding company is domiciled but
     the  Reinsurer  is  not admitted, the Reinsurer shall fund an amount herein
     called the "Deposit." The Deposit shall be (i) 110% of the outstanding loss
     and  LAE  reserves,  excluding  IBNR;  or  (ii) such other amount as may be
     provided  by  law or any applicable insurance regulatory agencies excluding
     IBNR,  whichever  is  greatest.

B.   The  Deposit  shall  be  adjusted  quarterly.

C.   The  Company  may,  at  any time after default by the Reinsurer of payments
     owing  to  the Company, require, by notice in writing to the Reinsurer, the
     payment  of  the sum due. In the event the Reinsurer shall not pay such sum
     within  seven  days  after  receipt  of  said  notice, the Company shall be
     entitled  to  appropriate  so  much  of  the  deposit as may be required to
     eliminate  the  default.  Until the deposit shall have been utilized in the
     manner  aforesaid,  interest  thereon  shall  be  credited to the Reinsurer
     quarterly  at  the  rate  of  four  percent  per  annum.


                                                                              29
<PAGE>
D.   The  Company  may  at  its  discretion,  instead  of taking any part of the
     deposit,  require payment of any sum in default, and it shall be no defense
     to  any such claim that the Company might have had recourse to the deposit.

E.   The  deposit  may  be  in  the  form  of cash, a Letter of Credit, or other
     security,  provided  such  Letter of Credit or other security satisfies the
     requirements  of  the  law  and the applicable Insurance Regulatory Agency.
     However,  a  Letter  of  Credit  is not an acceptable substitute in Canada.

F.   Notwithstanding  any  other  provisions  of  this  Agreement, the Letter of
     Credit  or  other  security may be drawn upon by the Company at any time to
     fund  the  deposit  or  for  any  amounts due from the Reinsurer under this
     Agreement.


                               NET RETAINED LINES
                               ------------------

A.   This Agreement applies only to that portion of any insurance or reinsurance
     which  the  Company  retains net for its own account and in calculating the
     amount  of  any loss hereunder and also in computing the amount of any loss
     hereunder  and  also  in computing the amount or amounts in excess of which
     this  Agreement attaches, only loss or losses in respect of that portion of
     any  insurance  or  reinsurance  which  the Company retains net for its own
     account  shall  be  included.

B.   The amount of the Reinsurer's liability hereunder in respect of any loss or
     losses  shall not be increased by reason of the inability of the Company to
     collect from any other Reinsurers, whether specific or general, any amounts
     which  may  become  due  from  them  whether such inability arises from the
     insolvency  of  such  other  Reinsurers  or  otherwise.

C.   Reinsurance  or  pooling agreements effected or entered into by the Company
     with  any  of  its  affiliated  companies under common management or common
     ownership which reduce the individual retained line of the Company shall be
     disregarded  for  the  purposes  of  this  Agreement.


                          DEFINITION OF LOSS OCCURRENCE
                          -----------------------------

The  term "Loss Occurrence" shall mean the sum of all individual losses directly
occasioned  by  any  one  disaster,  accident  or  loss  or series of disasters,
accidents or losses arising out of one event which occurs within the area of one
state  of  the  United  States  or  province  of  Canada and states or provinces
contiguous  thereto  and to one another. However, the duration and extent of any
one "Loss Occurrence" shall be limited to all individual losses sustained by the
Company  occurring during any period of 168 consecutive hours arising out of and
directly  occasioned  by  the  same event except that the term "Loss Occurrence"
shall  be  further  defined  as  follows:

(i)   As regards windstorm, hail, tornado, hurricane, cyclone, including ensuing
      collapse  and water damage, all individual losses sustained by the Company
      occurring  during  any  period  of 72 consecutive hours arising out of and
      directly  occasioned  by the same event. However, the event need not to be
      limited  to  one  state  or  province  or  states  or provinces contiguous
      thereto.

(ii)  As  regards  riot, riot attending a strike, civil commotion, vandalism and
      malicious  mischief,  all  individual  losses  sustained  by  the  Company
      occurring during any period of 72 consecutive hours within the area of one
      municipality  or  county  and  the  municipalities  or counties contiguous
      thereto  arising  out  of  and  directly occasioned by the same event. The
      maximum  duration  of  72  consecutive hours may be extended in respect of
      individual  losses which occur beyond such 72 consecutive hours during the
      continued  occupation  of an Assured's premises by strikers, provided such
      occupation  commenced  during  the  aforesaid  period.


                                                                              30
<PAGE>
(iii) As  regards  earthquake  (the  epicentre  of which need not necessarily be
      within  the  territorial  confines referred to in the opening paragraph of
      this  Article)  and  fire following directly occasioned by the earthquake,
      only  those individual fire losses which commence during the period of 168
      consecutive  hours  may  be  included  in the Company's "Loss Occurrence".

(iv)  As  regards  "Freeze",  only  individual  losses  directly  occasioned  by
      collapse, breakage of glass and water damage (caused by bursting of frozen
      pipes  and  tanks)  may  be  included  in the Company's "Loss Occurrence".

Except  for those "Loss Occurrences" referred to in (i) and (ii) the Company may
choose  the  date  and  time when any such period of consecutive hours commences
provided  that it is not earlier than the date and time of the occurrence of the
first  recorded  individual  loss  sustained  by the Company arising out of that
disaster,  accident  or  loss  and  provided  that  only  one such period of 168
consecutive  hours  shall  apply  with  respect  to  one  event.

However,  as  respects  those "Loss Occurrences" referred to in (i) and (ii), if
the  disaster,  accident  or loss occasioned by the event is of greater duration
than  72  consecutive hours, then the Company may divide that disaster, accident
or  loss into two or more "Loss Occurrences" provided no two periods overlap and
no individual loss is included in more than one such period and provided that no
period  commences  earlier than the date and time of the occurrence of the first
recorded  individual loss sustained by the Company arising out of that disaster,
accident  or  loss.

No  individual  losses  occasioned by an event that would be covered by 72 hours
clauses  may  be  included  in any "Loss Occurrence" claimed under the 168 hours
provision.

(v)  Losses directly or indirectly occasioned by:
     (i)   loss of, alteration of, or damage to
           or
     (ii)  a reduction in the functionality, availability or operation of

a  computer system, hardware, programme, software, data, information repository,
microchip,  integrated  circuit  or  similar  device  in  computer  equipment or
non-computer  equipment, whether the property of the policyholder of the Company
or  not,  do  not in and of themselves constitute an event unless arising out of
one  or  more  of  the  following  perils:

fire,  lightning,  explosion,  aircraft  or  vehicle  impact,  falling  objects,
windstorm,  hail,  tornado,  cyclone,  hurricane,  earthquake, volcano, tsunami,
flood,  freeze  or  weight  of  snow.


                                ULTIMATE NET LOSS
                                -----------------

A.   The term "Ultimate Net Loss" shall mean the actual loss or losses sustained
     by  the  Company, such loss to include all expenses (regardless of how such
     expenses  are  classified for statutory reporting purposes) incurred by the
     Company  in  connection  with  the settlement of losses or resistance to or
     negotiations concerning a loss, including those losses which are the result
     of  actions  and/or  disputes between the insured and the Company and legal
     expenses  incurred  in connection with coverage questions and legal actions
     connected  thereto,  excluding, however, any part of the office expenses of
     the  Company  and salaries of employees other than salary charges for staff
     adjusters,  fieldpersons  or  other employees while actually engaged in the
     settlement  of losses (including but not limited to charges and/or expenses
     incurred  through the use of AIG Claim Services and AIG Technical Services.

B.   Salvages  and recoveries, whether recovered or received prior or subsequent
     to loss settlement under this Contract, including amounts recoverable under
     all  Reinsurances,  whether  collected  or  not,  shall  be  applied  as if
     recovered  or received prior to the aforesaid settlement and shall be first
     deducted from the actual loss sustained to arrive at the amount of ultimate
     net  loss.  Nothing,  however,  in  this Article shall be construed to mean
     losses  are  not  recoverable  hereunder until the ultimate net loss to the
     Company  has  been  ascertained.


                                                                              31
<PAGE>
C.   Any  reinsurance  effected  by the Company where the ultimate purpose is to
     procure  a  catastrophe  bond  or  other  financial instrument, shall inure
     solely  to  the  benefit  of  the  Company  and  is  to  be  disregarded in
     determining  the  ultimate  net  loss.

D.   The  Company  is  granted  permission  to  carry  underlying excess of loss
     catastrophe  reinsurance,  recoveries  under  which shall inure to the sole
     benefit of the Company and shall be entirely disregarded for the purpose of
     determining  the  Company's  ultimate  net loss under this Contract, unless
     otherwise  stipulated  by  the  Company.


                       NOTICE OF LOSS AND LOSS SETTLEMENTS
                       -----------------------------------

A.   In  the event of a loss which either results in or appears to be of serious
     enough  nature  to result in the involvement of this Agreement, the Company
     shall  give  notice  as soon as reasonably practicable to the Reinsurer and
     the Company shall keep the Reinsurer advised of all subsequent developments
     in  connection  therewith.

B.   The  Reinsurer agrees to abide by the loss settlements of the Company, such
     settlements  to  be  considered as satisfactory proofs of loss, and amounts
     falling  to  the share of the Reinsurer shall be immediately payable to the
     Company  by  them upon reasonable evidence of the amount paid or to be paid
     by  the  Company  being  presented  to  the  Reinsurer  by  the  Company.


                        EXTRA CONTRACTUAL OBLIGATIONS AND
                        ---------------------------------
                       EXCESS LIMITS LIABILITY DEFINITION
                       ----------------------------------


This  Agreement will extend to cover 80% of any claims-related extra contractual
obligations  and/or  excess limits liability arising because of, but not limited
to,  the  following:

A.   Failure  of the Company to agree to pay a claim within the policy limits or
     to  provide  a  defense  against  such  claims.

B.   Actual  or  alleged  bad  faith,  fraud,  or negligence in investigating or
     handling  a  claim  or  in  rejecting  an  offer  of  settlement.

C.   Negligence  or  breach  of  duty  in  the preparation of the defense of the
     conduct  of  a trial or the preparation or prosecution of any appeal and/or
     subrogation  and/or  any  subsequent  action  resulting  therefrom.

"Extra  contractual  obligations"  as  used  in  this  Agreement will mean those
liabilities  not  covered  under any other provision of this Agreement for which
the  Company  is  liable  to  its insured or a third-party claimant, or that the
company  paid  as  its  share  of  a claims related extra contractual obligation
awarded  against  one  or  more  of  its  co-insurers.

"Excess limits liability" as used in this Agreement will mean any amount for
which the Company would have been contractually liable to pay had it not been
for the limits of the reinsured policy.

There  will  be  no recovery hereunder where the extra contractual obligation or
excess  limits liability has been incurred due to fraud committed by a member of
the  board  of  directors  or  a  corporate  officer  of  the  Company,  acting
individually,  collectively,  or  in  collusion  with  a  member of the board of
directors,  a  corporate  officer,  or  a  partner  of  any  other  corporation,
partnership, or organization involved in the defense or settlement of a claim on
behalf  of  the  Company.

The  date  on  which  any  extra  contractual  obligation  and/or  excess limits
liability is incurred by the Company will be deemed, in all circumstances, to be


                                                                              32
<PAGE>
the  date  of  the  original  loss. Nothing in this Article will be construed to
create  a  separate  or  distinct loss apart from the original covered loss that
gave  rise  to  the extra contractual obligations and/or excess limits liability
discussed  in  the  preceding  paragraphs.  The Reinsurers liability as respects
extra  contractual  obligations  and/or  excess  limits  liability  under  this
Agreement  will  be in addition to the indemnification coverage set forth in the
Retention and Limit Article, but the Reinsurers additional liability as respects
extra  contractual obligations and/or excess limits liability will not exceed an
amount  equal  to  25% of the Company's ultimate net loss, each loss occurrence.


                        ENTIRE AGREEMENT, INTERPRETATION
                        --------------------------------

A.   With  respect to the business being reinsured hereunder, (i) this Agreement
     constitutes the entire agreement between the parties, and (ii) there are no
     understandings or agreements between the parties other than those expressed
     in  this Agreement. Any change to or modification of this Agreement will be
     made  by  written  amendment  to  this  Agreement and signed by the parties
     hereto.

B.   This Agreement is between sophisticated parties, each of which has reviewed
     the  Agreement  and  is fully knowledgeable about its terms and conditions.
     The  parties therefore agree that this Agreement shall be construed without
     regard  to  the  authorship  of the language and without any presumption or
     rule  of  construction  in  favor  of  either  of  them.


                        SPECIAL TERMINATION OR SETTLEMENT
                        ---------------------------------

Section  I:  Termination
------------------------
A.   Either  party may terminate this Agreement upon 45 days notice in the event
     that:

     1.   The  other  party  should  at any time become insolvent, or suffer any
          impairment  of  capital,  or file a petition in bankruptcy, or go into
          liquidation  or  rehabilitation,  or  have a receiver appointed, or be
          acquired or controlled by any other insurance company or organization,
          or

     2.   There  is  a  severance  or  obstruction  of  free  and  unfettered
          communication  and/or  normal  commercial and/or financial intercourse
          between  the  United  States  of  America and the country in which the
          Reinsurer  is  incorporated or has its principal office as a result of
          war,  currency  regulations,  or  any  circumstances  arising  out  of
          political,  financial  or  economic  emergency.

B.   The  Company  may  terminate  this  Agreement  forthwith in the event that:

     1.   The  Reinsurer  ceases  writing  reinsurance and elects to run-off its
          existing  business;

     2.   As  respects  domestic  reinsurers:

               Upon  application  of  the  NAIC Insurance Regulatory Information
               System  (IRIS)  tests  to  the  Reinsurer's  quarterly and annual
               statements  (which  the Reinsurer hereby agrees to furnish to the
               Company  upon  request)  it is found that four (4) or more of the
               Reinsurer's  IRIS  financial  ratio  values are outside the usual
               range  established  in  the  IRIS  System.

     3.   As  respects  alien  reinsurers:

               Upon  review  of  the  Insurance  Solvency  International  (ISI)
               Performance  Tests as published with respect to the Reinsurer (or
               upon  application  of  such  Performance Tests to the Reinsurer's
               annual  financial statements which the Reinsurer hereby agrees to
               furnish to the Company upon request) it is found that four (4) or
               more  of  the  Reinsurer's ratios are outside of the normal range
               (as  defined  by  the  ISI  standard).


                                                                              33
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Termination  under A. or B. shall be effected by written notice of cancellation.
The  Company  will specify the mode of payment, i.e., a run-off basis or a clean
cut  basis  with  portfolio  transfer,  if  applicable. In the event the Company
elects  a  run-off  basis,  the Reinsurer will fund all of the outstanding ceded
liabilities  through  a  Trust  Account  or by providing a Letter of Credit that
meets  the  requirements  of  the  New  York  State  Insurance  Department.

Section II: Settlement
----------------------
After  termination  of  this  Agreement under this or any article, including the
natural  expiry of the Agreement, if the Reinsurer has any residual liability to
the  Company,  the Reinsurer will, at the request of the Company, furnish to the
Company  statements as specified in Section B. above, and if four or more values
are  outside  of  the  usual  range  established  in  the IRIS or ISI System (as
applicable in accordance with Section B above) the Company shall have the option
of  an  immediate  settlement  of  all present and future obligations under this
Agreement in accordance with Section III, or requiring the Reinsurer to fund all
of  the  outstanding ceded liabilities through a Trust Account or by providing a
Letter  of  Credit  that  meets the requirements of the New York State Insurance
Department.  In  the  event the Company elects the funding option, it shall then
notify  the  Reinsurer  in  writing and the Reinsurer shall provide such funding
within  15  days  of  such  notification; however, it is agreed that the Company
retains  the  right  to require settlement in accordance with Section III at any
subsequent  date.

Section III: Payment
--------------------
A.   Amounts  due  the Company or the Reinsurer under this Article shall include
     all  present  and  future  obligations and shall include unearned premiums,
     outstanding  losses,  (including  IBNR)  and  all  other  balances.

B.   In  the  event  of  a  clean-cut  termination with portfolio transfer or an
     immediate  settlement  of  all  present  and future obligations the Company
     will,  upon  receipt of payment, provide to the Reinsurers a full and final
     release  of  Reinsurer's  liability  under  the  Agreement.

C.   When  requested by either party an appraisal of outstanding losses and IBNR
     shall  be  made  to  a  disinterested  actuary.

D.   Settlement  shall  take  into  account  adjustment  for  Net Present Value.

This Article shall survive the termination of this Agreement.


                                 CONFIDENTIALITY
                                 ---------------

All  terms  and  conditions  of this Agreement and any materials provided in the
course  of  inspection  shall  be  kept confidential by the Reinsurer as against
third  parties,  unless the disclosure is required pursuant to process of law or
unless the disclosure is to Reinsurer's retrocessionaires, financial auditors or
governing  regulatory  bodies.  Disclosing  or  using  this  information for any
purpose  beyond  the scope of this Agreement, or beyond the exceptions set forth
above,  is  expressly  forbidden  without  the  prior  consent  of  the Company.


                                                                              34
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                                ACCESS TO RECORDS
                                -----------------

The  Reinsurer, or its duly authorized representative, shall have free access at
all  reasonable  times during and after the currency of this agreement, to books
and  records maintained by any of the division, department and branch offices of
the Company which are involved in the subject matter of this Agreement and which
pertain  to the reinsurance provided hereunder and all claims made in connection
therewith.  Notwithstanding  the  provisions  of  the  preceding  sentence,  if
undisputed  balances  due  from the Reinsurer under this Agreement have not been
paid for the two most recent reported calendar quarters, the Reinsurer shall not
have  access  to any of the Company's records relating to this Agreement without
the  specific  consent  of  the  Company.


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