<PAGE>


                                                                   EXHIBIT 10.59

                      INTERESTS AND LIABILITIES AGREEMENT
                               (the "Agreement")

                                       of

                       ENDURANCE SPECIALTY INSURANCE LTD.
                         (the "Subscribing Reinsurer")

                              with respect to the

                     CASUALTY SEMI-AUTOMATIC EXCESS OF LOSS
                              REINSURANCE CONTRACT
                                (the "Contract")

                                   issued to

                         PHILADELPHIA INSURANCE COMPANY
                           BALA CYNWYD, PENNSYLVANIA
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                           BALA CYNWYD, PENNSYLVANIA
                       MOBILE USA INSURANCE COMPANY, INC.
                             PINELLAS PARK, FLORIDA
                       LIBERTY AMERICAN INSURANCE COMPANY
                             PINELLAS PARK, FLORIDA
       AND ANY ADDITIONAL COMPANY ESTABLISHED OR ACQUIRED BY THE COMPANY
                                (the "Company")

The Subscribing Reinsurer shall have a 100.00% share in the interests and
liabilities of the "Reinsurer" as set forth in the Contract attached hereto and
executed by the Company.

This Agreement shall commence at 12:01 a.m., Eastern Time, March 1, 2003, and
shall continue in force until 12:01 a.m., Eastern Time, March 1, 2004.

The share of the Subscribing Reinsurer in the interests and liabilities of the
"Reinsurer" shall be several and not joint with the share of any other
subscribing reinsurer. In no event shall the Subscribing Reinsurer participate
in the interests and liabilities of the other subscribing reinsurers.

IN WITNESS WHEREOF, the Subscribing Reinsurer by its duly authorized
representative has executed this Agreement as of the date specified below:

Signed this 2nd day of September, 2003.

ENDURANCE SPECIALTY INSURANCE LTD.

By Raymond Harkins, Vice President
   --------------------------------

36772-003 (Formerly PX60937)                                              Willis
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<PAGE>

                         PHILADELPHIA INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA
                       MOBILE USA INSURANCE COMPANY, INC.
                             PINELLAS PARK, FLORIDA
                       LIBERTY AMERICAN INSURANCE COMPANY
                             PINELLAS PARK, FLORIDA
        AND ANY ADDITIONAL COMPANY ESTABLISHED OR ACQUIRED BY THE COMPANY

                     CASUALTY SEMI-AUTOMATIC EXCESS OF LOSS
                              REINSURANCE CONTRACT

<TABLE>
<CAPTION>
                                                               CONTRACT
REINSURER                                                   PARTICIPATION
---------                                                   -------------
<S>                                                         <C>
Endurance Specialty Insurance Ltd.                             100.00%
                                                               -------

TOTAL                                                          100.00%
</TABLE>

36772-003 (Formerly PX60937)                                              Willis
Eff: 03/01/03
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
ARTICLE                                                     PAGE
-------                                                     ----
<S>           <C>                                           <C>
I             BUSINESS COVERED                                1
II            COMMENCEMENT AND TERMINATION                    1
III           TERRITORY (BRMA 51A)                            2
IV            DEFINITIONS                                     2
                       Loss Occurrence                        2
                       Policy                                 2
                       Ultimate Net Loss                      2
V             COVERAGE                                        3
VI            EXCLUSIONS                                      3
VII           REINSURANCE PREMIUM AND COMMISSION              4
VIII          NET RETAINED LINES                              5
IX            CURRENCY                                        5
X             UNAUTHORIZED REINSURANCE                        6
XI            TAXES                                           7
XII           FEDERAL EXCISE TAX                              7
XIII          NOTICE OF LOSS AND LOSS SETTLEMENTS             8
XIV           LOSS IN EXCESS OF POLICY LIMITS                 8
XV            EXTRA CONTRACTUAL OBLIGATIONS                   9
XVI           SALVAGE AND SUBROGATION                         9
XVII          ERRORS AND OMISSIONS                            9
XVIII         ACCESS TO RECORDS                               9
XIX           OFFSET                                         10
XX            ARBITRATION                                    10
XXI           SERVICE OF SUIT                                11
XXII          INSOLVENCY                                     11
XXIII         GOVERNING LAW                                  12
XXIV          SEVERABILITY                                   12
XXV           THIRD PARTY RIGHTS                             13
XXVI          AGENCY AGREEMENT                               13
XXVII         MODE OF EXECUTION                              13
XXVIII        INTERMEDIARY                                   13
              Nuclear Incident Exclusion Clause - Liability - Reinsurance - U.S.A.
              War Exclusion
</TABLE>

36772-003 (Formerly PX60937)                                              Willis
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<PAGE>

                     CASUALTY SEMI-AUTOMATIC EXCESS OF LOSS
                              REINSURANCE CONTRACT
                                (the "Contract")

                                    between

                         PHILADELPHIA INSURANCE COMPANY
                           BALA CYNWYD, PENNSYLVANIA
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                           BALA CYNWYD, PENNSYLVANIA
                       MOBILE USA INSURANCE COMPANY, INC.
                             PINELLAS PARK, FLORIDA
                       LIBERTY AMERICAN INSURANCE COMPANY
                             PINELLAS PARK, FLORIDA
       AND ANY ADDITIONAL COMPANY ESTABLISHED OR ACQUIRED BY THE COMPANY
                                (the "Company")

                                      and

                    THE SUBSCRIBING REINSURER EXECUTING THE
                      INTERESTS AND LIABILITIES AGREEMENT
                                ATTACHED HERETO
                               (the "Reinsurer")

                                   ARTICLE I

BUSINESS COVERED

Business subject to and reinsured under this Contract shall be any and all
binders, Policies, contracts, and evidences of insurance covered under
Philadelphia Insurance Company Master Policy PHUB015555 and Philadelphia
Indemnity Insurance Company Master Policy PHUB015555-01, of Umbrella Liability
covering hotels, motels and various retail operations through the Company's
"Lessors Risk Only" program, as classified by the Company, which are issued or
renewed during the term of this Contract, and which are accepted, bound or
covered, provisionally or otherwise, by or on behalf of the Company through
McGowan and Associates, Rocky River, Ohio.

                                   ARTICLE II

COMMENCEMENT AND TERMINATION

A.       This Contract shall become effective at 12:01, a.m., Eastern Time,
         March 1, 2003, and shall continue in effect until 12:01, a.m., Eastern
         Time, March 1, 2004.

B.       Upon termination of this Contract, the Reinsurer shall remain liable
         for losses occurring under Policies in force on the termination date of
         this Contract until the first anniversary

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 1
<PAGE>

         date, termination, or natural expiration date of such Policies or until
         12 months following the date of termination (whichever occurs first)
         plus odd time not to exceed 18 months in all.

C.       Notwithstanding the above, upon termination of this Contract, the
         Company shall have the option of requiring that the entire liability of
         the Reinsurer for losses occurring subsequent to the date of
         termination shall cease concurrently with the date of termination of
         this Contract. The Reinsurer shall refund to the Company the portfolio
         of ceded unearned premium reserve, less any ceding commission
         previously allowed thereon, with respect to Policies in force as of the
         date of termination.

                                  ARTICLE III

TERRITORY (BRMA 51A)

The territorial limits of this Contract shall be identical with those of the
Company's Policies.

                                   ARTICLE IV

DEFINITIONS

A.       Loss Occurrence

         The term "Loss Occurrence" as used in this Contract shall mean each
         accident, casualty, disaster or loss, or series of accidents,
         casualties, disasters or losses, arising out of or caused by one event.

B.       Policy

         "Policy" or "Policies" as used in this Contract shall mean the
         Company's binders, policies, contracts, and evidences of insurance
         providing insurance and reinsurance on the classes of business covered
         under this Contract.

C.       Ultimate Net Loss

         The term "Ultimate Net Loss" as used in this Contract shall mean the
         actual loss paid by the Company or for which the Company becomes liable
         to pay, such loss shall include 100% of any Loss in Excess of Policy
         Limits as defined in the LOSS IN EXCESS OF POLICY LIMITS ARTICLE, 100%
         of any Extra Contractual Obligations as defined in the EXTRA
         CONTRACTUAL OBLIGATIONS ARTICLE, ex-gratia payments subject to prior
         approval, expenses of litigation and interest, claim-specific
         declaratory judgment expenses, and all other loss expense of the
         Company including subrogation, salvage, and recovery expenses (office
         expenses and salaries of officials and employees not classified as loss
         adjusters are not chargeable as expenses for purposes of this
         paragraph), but salvages and all recoveries, including recoveries under
         all reinsurances, which inure to the benefit of this Contract (whether
         recovered or not), shall be first deducted from such loss to arrive at
         the amount of liability attaching hereunder.

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 2


<PAGE>

         The phrase "ex-gratia payments" shall mean payments made as an
         accommodation by the Company in settlement of a claim for which no
         coverage exists under the Policy reinsured hereunder, subject to the
         prior approval of the Reinsurer.

         The phrase "claim-specific declaratory judgment expenses," as used in
         this Contract will mean all expenses incurred by the Company in
         connection with declaratory judgment actions brought to determine the
         Company's defense and/or indemnification obligations that are allocable
         to specific Policies and claims subject to this Contract.
         Claim-specific declaratory judgment expenses will be deemed to have
         been incurred by the Company on the date of the original loss (if any)
         giving rise to the declaratory judgment action.

         For purposes of this definition, the phrase "becomes liable to pay"
         shall mean the existence of a judgment, which the Company does not
         intend to appeal, or a release has been obtained by the Company, or the
         Company has accepted a proof of loss.

         Nothing in this clause shall be construed to mean that losses are not
         recoverable hereunder until the Company's Ultimate Net Loss has been
         ascertained.

                                   ARTICLE V

COVERAGE

A.       The Reinsurer shall be liable for the amount of Ultimate Net Loss in
         excess of $11,000,000 each and every Loss Occurrence, each Policy,
         subject to a limit of liability to the Reinsurer of $9,000,000 each and
         every Loss Occurrence, each Policy.

B.       However, should the Company issue the primary Policy and the Umbrella
         Policy for the same assured, the Reinsurer shall be liable for the
         amount of Ultimate Net Loss in excess of $10,000,000 each and every
         Loss Occurrence, each Policy, subject to a limit of liability to the
         Reinsurer of $10,000,000 each and every Loss Occurrence, each Policy.

                                   ARTICLE VI

EXCLUSIONS

This Contract does not cover and specifically excludes:

1.       Life, Group and Other Accident and Health, Ocean Marine, Aircraft (all
         perils), Surety, Fidelity and Credit, when written as such.

2.       Mortgage Impairment Insurance, Financial Guarantee, Insolvency and
         Title, when written as such.

3.       Automobile Physical Damage and Motor Cargo Insurance, when written as
         such.

4.       Private Passenger Automobile Liability, unless incidental to the
         writing of a commercial account.

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 3

<PAGE>

5.       Nuclear incident pursuant to the "Nuclear Incident Exclusion Clause -
         Liability - Reinsurance - U.S.A.," attached hereto.

6.       War risks as excluded by the War Exclusion, attached hereto.

7.       Liability of the Company arising by contract, operation of law, or
         otherwise, from its participation or membership, whether voluntary or
         involuntary, in any insolvency fund. "Insolvency Fund" includes any
         guaranty fund, insolvency fund, plan, pool, association, fund or other
         arrangement, howsoever denominated, established or governed, which
         provides for any assessment of or payment or assumption by the Company
         of part or all of any claim, debt, charge, fee, or other obligation of
         an insurer, or its successors or assigns, which has been declared by
         any competent authority to be insolvent, or which is otherwise deemed
         unable to meet any claim, debt, charge, fee or other obligation in
         whole or in part.

8.       Business received as a member of Pools, Associations, or Syndicates,
         except losses from Assigned Risk Plans or similar plans are not
         excluded.

9.       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, as well as Policies written for the captive of the
         Company's insured, will not be excluded hereunder.

                                  ARTICLE VII

REINSURANCE PREMIUM AND COMMISSION

A.       Within 30 days following the end of each month, the Company shall pay
         to the Reinsurer a Ceded Premium calculated as follows:

         1.       As respects Umbrella limits of $4,000,000 excess $11,000,000,
                  the Ceded Premium shall be 10% of the premium charged by the
                  Company for the first $15,000,000 of Umbrella limit.

         2.       As respects Umbrella limits of $5,000,000 excess $15,000,000
                  the Ceded Premium shall be 10% of the premium charged by the
                  Company for the first $15,000,000 of Umbrella limit.

B.       The Reinsurer shall allow the Company a ceding commission equal to
         27.5% of the Ceded Premium.

C.       As respects Policies for which the Company issues both the primary
         Policy and Umbrella Policy, the Company shall pay an additional Ceded
         Premium of $20 per Policy. A bordereau of such Policies shall be
         submitted to the Reinsurer as soon as possible following the expiration
         of this Contract, and the additional Ceded Premium shall accompany the
         bordereau.

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                                     Page 4

<PAGE>

D.       Within 30 days following the end of each month, the Company shall
         submit to the Reinsurer a bordereau of Policies ceded hereunder during
         the month, which shall include the following:

         1.       Insured Name and Location
         2.       Master Policy Number
         3.       Policy Number
         4.       Policy Period
         5.       Policy Limits
         6.       Gross Ceded Premium
         7.       Ceding Commission
         8.       Net Ceded Premium

                                  ARTICLE VIII

NET RETAINED LINES

This Contract applies only to that portion of any insurances or reinsurances
covered by this Contract, which the Company retains net for its own account and,
in calculating the amount of any loss hereunder and also in computing the amount
in excess of which this Contract attaches, only loss or losses in respect of
that portion of any insurances or reinsurances which the Company retains net for
its own account shall be included.

The Company reserves the right to maintain reinsurance agreement(s) in respect
of its net retention under this Contract, and recoveries under said
reinsurance(s) shall be entirely disregarded in determining the Ultimate Net
Loss hereunder.

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 have become due from them whether such inability arises from the
insolvency of such other reinsurers or otherwise.

                                   ARTICLE IX

CURRENCY

Whenever the word "Dollars" or the "$" sign appears in this Contract, they shall
be construed to mean United States Dollars and all transactions under this
Contract shall be in United States Dollars. Amounts paid or received by the
Company in any other currency shall be converted to United States Dollars at the
rate of exchange at the date such transaction is entered on the books of the
Company.

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 5
<PAGE>

                                    ARTICLE X

UNAUTHORIZED REINSURANCE

(Applies only to a Reinsurer who does not qualify for full credit with any
insurance regulatory authority having jurisdiction over the Company's reserves.)

As regards Policies or bonds issued by the Company coming within the scope of
this Contract, the Company agrees that when it shall file with the insurance
regulatory authority or set up on its books reserves for losses covered
hereunder which it shall be required by law to set up, it will forward to the
Reinsurer a statement showing the proportion of such reserves which is
applicable to the Reinsurer. The Reinsurer hereby agrees to fund such reserves
in respect of known outstanding losses that have been reported to the Reinsurer
and allocated loss adjustment expense relating thereto, losses and allocated
loss adjustment expense paid by the Company but not recovered from the
Reinsurer, plus reserves for losses incurred but not reported, as shown in the
statement prepared by the Company (hereinafter referred to as "Reinsurer's
Obligations") by funds withheld, cash advances or a Letter of Credit. The
Reinsurer shall have the option of determining the method of funding provided it
is acceptable to the insurance regulatory authorities having jurisdiction over
the Company's reserves.

When funding by a Letter of Credit, the Reinsurer agrees to apply for and secure
timely delivery to the Company of a clean, irrevocable and unconditional Letter
of Credit issued by a bank and containing provisions acceptable to the insurance
regulatory authorities having jurisdiction over the Company's reserves in an
amount equal to the Reinsurer's proportion of said reserves. Such Letter of
Credit shall be issued for a period of not less than one year and shall be
automatically extended for one year from its date of expiration or any future
expiration date unless 30 days (60 days where required by insurance regulatory
authorities) prior to any expiration date the issuing bank shall notify the
Company by certified or registered mail that the issuing bank elects not to
consider the Letter of Credit extended for any additional period.

The Reinsurer and Company agree that the Letters of Credit provided by the
Reinsurer pursuant to the provisions of this Contract may be drawn upon at any
time, notwithstanding any other provision of this Contract, and be utilized by
the Company or any successor, by operation of law, of the Company including,
without limitation, any liquidator, rehabilitator, receiver or conservator of
the Company for the following purposes, unless otherwise provided for in a
separate Trust Agreement:

(a)      to reimburse the Company for the Reinsurer's Obligations, the payment
         of which is due under the terms of this Contract and which has not been
         otherwise paid;

(b)      to make refund of any sum which is in excess of the actual amount
         required to pay the Reinsurer's Obligations under this Contract;

(c)      to fund an account with the Company for the Reinsurer's Obligations.
         Such cash deposit shall be held in an interest bearing account separate
         from the Company's other assets, and interest thereon not in excess of
         the prime rate shall accrue to the benefit of the Reinsurer;

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 6

<PAGE>

(d)      to pay the Reinsurer's share of any other amounts the Company claims
         are due under this Contract.

In the event the amount drawn by the Company on any Letter of Credit is in
excess of the actual amount required for (a) or (c) or, in the case of (d), the
actual amount determined to be due, the Company shall promptly return to the
Reinsurer the excess amount so drawn. All of the foregoing shall be applied
without diminution because of insolvency on the part of the Company or the
Reinsurer.

The issuing bank shall have no responsibility whatsoever in connection with the
propriety of withdrawals made by the Company or the disposition of funds
withdrawn, except to ensure that withdrawals are made only upon the order of
properly authorized representatives of the Company.

At annual intervals or more frequently as agreed, but never more frequently than
quarterly, the Company shall prepare a specific statement of the Reinsurer's
Obligations, for the sole purpose of amending the Letter of Credit, in the
following manner:

(a)      If the statement shows that the Reinsurer's Obligations exceed the
         balance of credit as of the statement date, the Reinsurer shall, within
         30 days after receipt of notice of such excess, secure delivery to the
         Company of an amendment to the Letter of Credit increasing the amount
         of credit by the amount of such difference.

(b)      If, however, the statement shows that the Reinsurer's Obligations are
         less than the balance of credit as of the statement date, the Company
         shall, within 30 days after receipt of written request from the
         Reinsurer, release such excess credit by agreeing to secure an
         amendment to the Letter of Credit reducing the amount of credit
         available by the amount of such excess credit.

                                   ARTICLE XI

TAXES

In consideration of the terms under which this Contract is issued, the Company
will not claim a deduction in respect of the premium hereon when making tax
returns, other than income or profits tax returns, to any state or territory of
the United States of America, the District of Columbia or Canada.

                                  ARTICLE XII

FEDERAL EXCISE TAX

(Applicable to those Reinsurers, excepting Underwriters at Lloyd's London and
other Reinsurers exempt from Federal Excise Tax, who are domiciled outside the
United States of America.)

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 7

<PAGE>

The Reinsurer has agreed to allow, for the purpose of paying the Federal Excise
Tax, the applicable percentage of the premium payable hereon (as imposed under
Section 4371 of the Internal Revenue Code) to the extent such premium is subject
to the Federal Excise Tax.

In the event of any return of premium becoming due hereunder, the Reinsurer will
deduct the applicable percentage from the return premium payable hereon, and the
Company or its agent should take steps to recover the tax from the United States
Government.

                                  ARTICLE XIII

NOTICE OF LOSS AND LOSS SETTLEMENTS

The Company will advise the Reinsurer promptly of all claims which in the
opinion of the Company may involve the Reinsurer and of all subsequent
developments on these claims which may materially affect the position of the
Reinsurer, such advices to include any claim for which the reserve is 50% or
more of the Company's retention.

The Reinsurer agrees to abide by the loss settlements of the Company provided
that retroactive extension of Policy terms or coverages made voluntarily by the
Company and not in response to court decisions (whether such court decision is
against the Company or other companies affording the same or similar coverages)
will not be covered under this Contract.

When so requested, the Company will afford the Reinsurer an opportunity to be
associated with the Company, at the expense of the Reinsurer, in the defense of
any claim or suit or proceeding involving this reinsurance, and the Company will
cooperate in every respect in the defense of such claim, suit or proceeding.

The Reinsurer will pay its share of loss settlements within 15 days upon receipt
and verification of proof of loss from the Company.

                                  ARTICLE XIV

LOSS IN EXCESS OF POLICY LIMITS

This Contract shall protect the Company, within the limits hereof, in connection
with the Ultimate Net Loss in excess of the limit of its original Policy, such
loss in excess of the limit having been incurred because of failure by it to
settle within the Policy limit or by reason of alleged or actual negligence,
criminal act or fraud, or bad faith in rejecting an offer of settlement or in
the preparation of the defense or in the trial of any action against its insured
or reinsured or in the preparation or prosecution of an appeal consequent upon
such action.

For the purpose of this Article, the word "loss" shall mean any amounts for
which the Company would have been contractually liable to pay had it not been
for the limit of the original Policy. However, this Article shall not apply
where the loss has been incurred due to fraud by a member of the Board of
Directors or a corporate officer of the Company acting individually or
collectively or in collusion with any individual or corporation or any other
organization or party involved in the presentation, defense or settlement of any
claim covered hereunder.

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 8

<PAGE>

                                   ARTICLE XV

EXTRA CONTRACTUAL OBLIGATIONS

This Contract shall protect the Company within the limits hereof, where the
Ultimate Net Loss includes any Extra Contractual Obligations. The term "Extra
Contractual Obligations" is defined as those liabilities not covered under any
other provision of this Contract and which arise from the handling of any claim
on business covered hereunder, such liabilities arising because of, but not
limited to, the following: failure by the Company to settle within the Policy
limit, or by reason of alleged or actual negligence, criminal act or fraud, or
bad faith in rejecting an offer of settlement or in the preparation of the
defense or in the trial of any action against its insured or reinsured or in the
preparation or prosecution of an appeal consequent upon such action.

The date on which any Extra Contractual Obligation is incurred by the Company
shall be deemed, in all circumstances, to be the date of the original disaster
and/or casualty.

However, this Article shall not apply where the loss has been incurred due to
fraud by a member of the Board of Directors or a corporate officer of the
Company acting individually or collectively or in collusion with any individual
or corporation or any other organization or party involved in the presentation,
defense or settlement of any claim covered hereunder.

                                  ARTICLE XVI

SALVAGE AND SUBROGATION

All salvages, recoveries or payments recovered or received subsequent to loss
settlements hereunder shall be applied as if recovered or received prior to the
aforesaid settlement, and all necessary adjustments shall be made by the parties
hereto.

                                  ARTICLE XVII

ERRORS AND OMISSIONS

Any inadvertent delay, omission or error shall not be held to relieve either
party hereto from any liability, which would attach to it hereunder, if such
delay, omission or error had not been made, providing such delay, omission or
error is rectified upon discovery.

                                 ARTICLE XVIII

ACCESS TO RECORDS

The Company shall place at the disposal of the Reinsurer at all reasonable
times, and the Reinsurer shall have the right to inspect through its designated
representatives, all books, records and papers of the Company in connection with
any reinsurance hereunder or claims in connection herewith. Rights of access to
records shall survive the termination or expiration of this Contract.

36772-003 (Formerly PX60937)                                              Willis
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                                     Page 9

<PAGE>

                                  ARTICLE XIX

OFFSET

The Company and the Reinsurer, each at its option, may offset any balance or
balances, whether on account of premiums, claims and losses, loss expenses or
salvages due from one party to the other under this Contract; provided, however,
that in the event of the insolvency of a party hereto, offsets shall only be
allowed in accordance with applicable statutes and regulations.

                                   ARTICLE XX

ARBITRATION

As a condition precedent to any right of action hereunder, any irreconcilable
dispute between the parties to this Contract will be submitted for decision to a
board of arbitration composed of two arbitrators and an umpire meeting in Bala
Cynwyd, Pennsylvania.

Arbitration shall be initiated by the delivery of a written notice of demand for
arbitration by one party to the other within a reasonable time after the dispute
has arisen.

The members of the board of arbitration shall be active or former, disinterested
officials of insurance or reinsurance companies or Underwriters at Lloyd's,
London, not under the control or management of either party to this Contract.
Each party shall appoint its arbitrator, and the two arbitrators shall choose an
umpire before instituting the hearing. If the respondent fails to appoint its
arbitrator within 4 weeks after being requested to do so by the claimant, the
latter shall also appoint the second arbitrator.

If the two arbitrators are unable to agree upon the umpire within 30 days of
their appointment, the umpire shall be selected by a judge of any court of
competent jurisdiction.

The claimant shall submit its initial brief within 45 days from appointment of
the umpire. The respondent shall submit its brief within 45 days thereafter, and
the claimant may submit a reply brief within 30 days after filing of the
respondent's brief.

The board shall make its decision with regard to the custom and usage of the
insurance and reinsurance business. The board shall issue its decision in
writing based upon a hearing in which evidence may be introduced without
following strict rules of evidence but in which cross-examination and rebuttal
shall be allowed. The board shall make its decision within 60 days following the
termination of the hearings unless the parties consent to an extension. The
majority decision of the board shall be final and binding upon all parties to
the proceeding. Judgment may be entered upon the award of the board in any court
having jurisdiction.

If more than one reinsurer is involved in the same dispute, all such reinsurers
shall constitute and act as one party for purposes of this clause, and
communications shall be made by the Company to each of the reinsurers
constituting the one party provided, however, that nothing therein shall impair
the rights of such reinsurers to assert several rather than joint defenses or
claims, nor be construed as changing the liability of the reinsurers under the
terms of this Contract from several to joint.

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<PAGE>

Each party shall bear the expense of its own arbitrator and shall jointly and
equally bear with the other party the expense of the umpire. The remaining costs
of the arbitration proceedings shall be allocated by the board.

                                  ARTICLE XXI

SERVICE OF SUIT

(This Article only applies to reinsurers domiciled outside of the United States
and/or unauthorized in any state, territory, or district of the United States
having jurisdiction over the Company).

It is agreed that, in the event of the failure of the Reinsurer hereon to pay
any amount claimed to be due hereunder, the Reinsurer hereon, at the request of
the Company, will submit to the jurisdiction of a court of competent
jurisdiction within the United States. Nothing in this Article constitutes or
should be understood to constitute a waiver of the Reinsurer's rights to
commence an action in any court of competent jurisdiction in the United States,
to remove an action to a United States District Court or to seek a transfer of a
case to another court as permitted by the laws of the United States or of any
state in the United States.

It is further agreed that service of process in such suit may be made upon
Mendes and Mount, 750 Seventh Avenue, New York, New York 10019, and that in any
suit instituted the Reinsurer will abide by the final decision of such court or
of any appellate court in the event of an appeal.

The above-named are authorized and directed to accept service of process on
behalf of the Reinsurer in any such suit and/or upon the request of the Company
to give a written undertaking to the Company that they will enter a general
appearance upon the Reinsurer's behalf in the event such a suit shall be
instituted.

Further, pursuant to any statute of any state, territory or district of the
United States which makes provision therefor, the Reinsurer hereon hereby
designates the Superintendent, Commissioner or Director of Insurance or other
officer specified for that purpose in the statute, or his successor or
successors in office, as its true and lawful attorney upon whom may be served
any lawful process in any action, suit or proceeding instituted by or on behalf
of the Company or any beneficiary hereunder arising out of this Contract of
reinsurance and hereby designates the above-named as the person to whom the said
officer is authorized to mail such process or a true copy thereof.

                                  ARTICLE XXII

INSOLVENCY

In the event of the insolvency of the Company, this reinsurance shall be payable
directly to the Company or to its liquidator, receiver, conservator or statutory
successor on the basis of the liability of the Company without diminution
because of the insolvency of the Company or because the liquidator, receiver,
conservator or statutory successor of the Company has failed to pay all or a
portion of any claim. It is agreed, however, that the liquidator, receiver,
conservator or statutory successor of the Company shall give written notice to
the Reinsurer of the pendency

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of a claim against the Company indicating the Policy or bond reinsured, which
claim would involve a possible liability on the part of the Reinsurer, within a
reasonable time after such claim is filed in the conservation or liquidation
proceeding or in the receivership and that, during the pendency of such claim,
the Reinsurer may investigate such claim and interpose, at its own expense, in
the proceeding where such claim is to be adjudicated, any defense or defenses
that it may deem available to the Company or its liquidator, receiver,
conservator or statutory successor. The expense thus incurred by the Reinsurer
shall be chargeable, subject to the approval of the court, against the Company
as part of the expense of conservation or liquidation to the extent of a pro
rata share of the benefit, which may accrue to the Company solely as a result of
the defense undertaken by the Reinsurer.

Where two or more reinsurers are involved in the same claim and a majority in
interest elect to interpose defense to such claim, the expense shall be
apportioned in accordance with the terms of this Contract as though such expense
had been incurred by the insolvent Company.

In the event of the insolvency of the Company, the reinsurance under this
Contract shall be payable directly by the Reinsurer to the Company or to its
liquidator, receiver, conservator or statutory successor, except as provided by
Section 4118(a) of the New York Insurance Law or except (a) where this Contract
specifically provides another payee of such reinsurance in the event of the
insolvency of the Company or (b) where the Reinsurer with the consent of the
direct insured or insureds has assumed such Policy obligations of the Company as
direct obligations of the Reinsurer to the payees under such Policies and in
substitution for the obligations of the Company to such payees.

Should the Company go into liquidation or should a receiver be appointed, all
amounts due either Company or Reinsurer under this or any other agreement,
whether by reason of premium, losses or otherwise under this Contract, shall be
subject to the right of offset at any time and from time to time and, upon the
exercise of the same, only the net balance shall be due.

In the event of the insolvency of any company or companies included in the
designation of "Company," this clause will apply only to the insolvent company
or companies.

                                 ARTICLE XXIII

GOVERNING LAW

This Contract shall be governed as to performance, administration and
interpretation by the laws of the State of Pennsylvania, exclusive of the rules
with respect to conflicts of law, except as to rules with respect to credit for
reinsurance, in which case the applicable rules of all states shall apply.

                                  ARTICLE XXIV

SEVERABILITY

If any provision of this Contract should be invalid under applicable laws, the
latter shall control but only to the extent of the conflict without affecting
the remaining provisions of this Contract.

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<PAGE>

                                   ARTICLE XXV

THIRD PARTY RIGHTS

This Contract is solely between the Company and the Reinsurer, and in no
instance shall any other party have any rights under this Contract except as
expressly provided otherwise in the INSOLVENCY ARTICLE.

                                  ARTICLE XXVI

AGENCY AGREEMENT

If more than one reinsured company is named as a party to this Contract, the
first named company will be deemed the agent of the other reinsured companies
for purposes of sending or receiving notices required by the terms and
conditions of this Contract and for purposes of remitting or receiving any
monies due any party.

                                 ARTICLE XXVII

MODE OF EXECUTION

This Contract may be executed either by an original written ink signature of
paper documents, by an exchange of facsimile copies showing the original written
ink signature of paper documents, or by electronic signature by either party
employing appropriate software technology as to satisfy the parties at the time
of execution that the version of the document agreed to by each party shall
always be capable of authentication and satisfy the same rules of evidence as
written signatures. The use of any one or a combination of these methods of
execution shall constitute a legally binding and valid signing of this Contract.
This Contract may be executed in one or more counterparts, each of which, when
duly executed, shall be deemed an original.

                                 ARTICLE XXVIII

INTERMEDIARY

Willis Re Inc., 11 Penn Center, Suite 2700, 1835 Market Street, Philadelphia,
Pennsylvania 19103 is hereby recognized as the intermediary negotiating this
Contract and through whom all communications relating thereto shall be
transmitted to the Company or the Reinsurer. However, all communications
concerning accounts, contracts, claim information, funds and inquiries related
thereto shall be transmitted to the Company or the Reinsurer through Willis Re,
Inc., P.O. Box 3000, McLeansville, North Carolina 27301-3000. Payments by the
Company to Willis Re, Inc. shall be deemed to constitute payment to the
Reinsurer and payments by the Reinsurer to Willis Re, Inc. shall be deemed to
constitute payment to the Company only to the extent that such payments are
actually received by the Company.

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<PAGE>

IN WITNESS WHEREOF, the Company by its duly authorized representative has
executed this Contract as of the date specified below:

Signed this 18th day of August, 2003.

PHILADELPHIA INSURANCE COMPANY
PHILADELPHIA INDEMNITY INSURANCE COMPANY
MOBILE USA INSURANCE COMPANY, INC.
LIBERTY AMERICAN INSURANCE COMPANY
AND ANY ADDITIONAL COMPANY ESTABLISHED OR ACQUIRED BY THE COMPANY

By Christopher Maguire, Executive Vice President and Chief Underwriting Officer
   ----------------------------------------------------------------------------

36772-003 (Formerly PX60937)                                              Willis
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                                    Page 14

<PAGE>

      NUCLEAR INCIDENT EXCLUSION CLAUSE - LIABILITY - REINSURANCE - U.S.A.

(1)      This reinsurance does not cover any loss or liability accruing to the
Reassured as a member of, or subscriber to, any association of insurers or
reinsurers formed for the purpose of covering nuclear energy risks or as a
direct or indirect reinsurer of any such member, subscriber or association.

(2)      Without in any way restricting the operation of paragraph (1) of this
Clause it is understood and agreed that for all purposes of this reinsurance all
the original policies of the Reassured (new, renewal and replacement) of the
classes specified in Clause II of this paragraph (2) from the time specified in
Clause III in this paragraph (2) shall be deemed to include the following
provision (specified as the Limited Exclusion Provision):

                         LIMITED EXCLUSION PROVISION.*

I.       It is agreed that the policy does not apply under any liability
         coverage,
         to..........(injury, sickness, disease, death or destruction,
                     (bodily injury or property damage
         with respect to which an insured under the policy is also an insured
         under a nuclear energy liability policy issued by Nuclear Energy
         Liability Insurance Association, Mutual Atomic Energy Liability
         Underwriters or Nuclear Insurance Association of Canada, or would be an
         insured under any such policy but for its termination upon exhaustion
         of its limit of liability.

II.      Family Automobile Policies (liability only), Special Automobile
         Policies (private passenger automobiles, liability only), Farmers
         Comprehensive Personal Liability Policies (liability only),
         Comprehensive Personal Liability Policies (liability only) or policies
         of a similar nature; and the liability portion of combination forms
         related to the four classes of policies stated above, such as the
         Comprehensive Dwelling Policy and the applicable types of Homeowners
         Policies.

III.     The inception dates and thereafter of all original policies as
         described in II above, whether new, renewal or replacement, being
         policies which either

                  (a)      become effective on or after 1st May, 1960, or

                  (b)      become effective before that date and contain the
         Limited Exclusion Provision set out above; provided this paragraph (2)
         shall not be applicable to Family Automobile Policies, Special
         Automobile Policies, or policies or combination policies of a similar
         nature, issued by the Reassured on New York risks, until 90 days
         following approval of the Limited Exclusion Provision by the
         Governmental Authority having jurisdiction thereof.

(3)      Except for those classes of policies specified in Clause II of
paragraph (2) and without in any way restricting the operation of paragraph (1)
of this Clause, it is understood and agreed that for all purposes of this
reinsurance the original liability policies of the Reassured (new, renewal and
replacement) affording the following coverages:

         Owners, Landlords and Tenants Liability, Contractual Liability,
         Elevator Liability, Owners or Contractors (including railroad)
         Protective Liability, Manufacturers and Contractors Liability, Product
         Liability, Professional and Malpractice Liability, Storekeepers
         Liability, Garage Liability, Automobile Liability (including
         Massachusetts Motor Vehicle or Garage Liability)

shall be deemed to include, with respect to such coverages, from the time
specified in Clause V of this paragraph (3), the following provision (specified
as the Broad Exclusion Provision):

                          BROAD EXCLUSION PROVISION.*

                  It is agreed that the policy does not apply:

I.       Under any Liability Coverage, to (injury, sickness, disease, death or
         destruction
                                         (bodily injury or property damage
                  (a)      with respect to which an insured under the policy is
                  also an insured under a nuclear energy liability policy issued
                  by Nuclear Energy Liability Insurance Association, Mutual
                  Atomic Energy Liability Underwriters or Nuclear Insurance
                  Association of Canada, or would be an insured under any such
                  policy but for its termination upon exhaustion of its limit of
                  liability; or

                  (b)      resulting from the hazardous properties of nuclear
                  material and with respect to which (1) any person or
                  organization is required to maintain financial protection
                  pursuant to the Atomic Energy Act of 1954, or any law
                  amendatory thereof, or (2) the insured is, or had this policy
                  not been issued would be, entitled to indemnity from the
                  United States of America, or any agency thereof, under any
                  agreement entered into by the United States of America, or any
                  agency thereof, with any person or organization.

II.      Under any Medical Payments Coverage, or under any Supplementary
         Payments Provision relating to (immediate medical or surgical relief,
                           (first aid,
                     to expenses incurred with respect
                     to    (bodily injury, sickness, disease or death
                           (bodily injury
         resulting from the hazardous properties of nuclear material and arising
         out of the operation of a nuclear facility by any person or
         organization.

III.     Under any Liability Coverage to (injury, sickness, disease, death or
         destruction
                                        (bodily injury or property damage

         resulting from the hazardous properties of nuclear material, if

                  (a)      the nuclear material (1) is at any nuclear facility
                  owned by, or operated by or on behalf of, an insured or (2)
                  has been discharged or dispersed therefrom;

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         (b)      the nuclear material is contained in spent fuel or waste at
         any time possessed, handled, used, processed, stored, transported or
         disposed of by or on behalf of an insured; or

         (c)      the      (injury, sickness, disease, death or destruction
                           (bodily injury or property damages
                  arises out of the furnishing by an insured of services,
                  materials, parts or equipment in connection with the planning,
                  construction, maintenance, operation or use of any nuclear
                  facility, but if such facility is located within the United
                  States of America, its territories, or possessions or Canada,
                  this exclusion (c) applies only to
                           (injury to or destruction of property at such nuclear
                           facility
                  (property damage to such nuclear facility and any property
                  threat.

IV.      As used in this endorsement:

         "HAZARDOUS PROPERTIES" include radioactive, toxic or explosive
         properties; "NUCLEAR MATERIAL" means source material, special nuclear
         material or byproduct material; "SOURCE MATERIAL," "SPECIAL NUCLEAR
         MATERIAL," and "BYPRODUCT MATERIAL" have the meanings given them in the
         Atomic Energy Act of 1954 or in any law amendatory thereof; "SPENT
         FUEL" means any fuel element or fuel component, solid or liquid, which
         has been used or exposed to radiation in a nuclear reactor; "WASTE"
         means any waste material (1) containing byproduct material and (2)
         resulting from the operation by any person or organization of any
         nuclear facility included within the definition of nuclear facility
         under paragraph (a) or (b) thereof; "NUCLEAR FACILITY" means

         (a)      any nuclear reactor,

                  (b)      any equipment or device designed or used for (1)
                           separating the isotopes of uranium or plutonium, (2)
                           processing or utilizing spent fuel, or (3) handling,
                           processing or packaging waste,

                  (c)      any equipment or device used for the processing,
                  fabricating or alloying of special nuclear material if at any
                  time the total amount of such material in the custody of the
                  insured at the premises where such equipment or device is
                  located consists of or contains more than 25 grams of
                  plutonium or uranium 233 or any combination thereof, or more
                  than 250 grams of uranium 235,

         (d)      any structure, basin, excavation, premises or place prepared
         or used for the storage or disposal of waste,

         and includes the site on which any of the foregoing is located, all
         operations conducted on such site and all premises used for such
         operations; "NUCLEAR REACTOR" means any apparatus designed or used to
         sustain nuclear fission in a self-supporting chain reaction or to
         contain a critical mass of fissionable material;

                           (With respect to injury to or destruction of
                           property, the word "injury" or "destruction"

                           ("property damage" includes all forms of radioactive
                           contamination of property

                           (includes all forms of radioactive contamination of
                           property.

V.       The inception dates and thereafter of all original policies affording
         coverages specified in this paragraph (3), whether new, renewal or
         replacement, being policies which become effective on or after 1st May,
         1960, provided this paragraph (3) shall not be applicable to

         (i) Garage and Automobile Policies issued by the Reassured on New York
         risks, or

         (ii) statutory liability insurance required under Chapter 90, General
         Laws of Massachusetts,
                  until 90 days following approval of the Broad Exclusion
                  Provision by the Governmental Authority having jurisdiction
                  thereof.

(4)      Without in any way restricting the operation of paragraph (1) of this
Clause, it is understood and agreed that paragraphs (2) and (3) above are not
applicable to original liability policies of the Reassured in Canada and that
with respect to such policies this Clause shall be deemed to include the Nuclear
Energy Liability Exclusion Provisions adopted by the Canadian Underwriters'
Association of the Independent Insurance Conference of Canada.

                  *NOTE:   The words printed in italics in the Limited Exclusion
                           Provision and in the Broad Exclusion Provision shall
                           apply only in relation to original liability policies
                           which include a Limited Exclusion Provision or a
                           Broad Exclusion Provision containing those words.

21/9/67
N.M.A. 1590
BRMA 35A

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                                 WAR EXCLUSION

As regards interests which at time of loss or damage are on shore, no liability
shall attach hereto in respect of any loss or damage which is occasioned by war,
invasion, hostilities, acts of foreign enemies, civil war, rebellion,
insurrection, military or usurped power, or martial law or confiscation by order
of any government or public authority.

This War Exclusion Clause shall not, however, apply to interests which at time
of loss or damage are within the territorial limits of the United States of
America (comprising the fifty States of the Union and the District of Columbia,
its territories and possessions, including the Commonwealth of Puerto Rico and
including Bridges between the United States of America and Mexico provided they
are under United States ownership), Canada, St. Pierre and Miquelon, provided
such interests are insured under original policies, endorsements or binders
containing a standard war or hostilities or warlike operations exclusion clause.

Nevertheless, this clause shall not be construed to apply to loss or damage
occasioned by riots, strikes, civil commotion, vandalism, malicious damage,
including acts committed by agents of any government, party or faction engaged
in war, hostilities or other warlike operation, provided such agents are acting
secretly and not in connection with any operations of military or naval armed
forces in the country where the interests insured are situated.

36772-003 (Formerly PX60937)                                              Willis
Eff: 03/01/03