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                                                                    EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT
                              --------------------

                  This Employment Agreement ("Agreement") is entered into as of
May 1, 2002 by and between SCPIE Management Company, a California corporation
("Employer"), and Timothy C. Rivers (the "Executive"), and, solely for the
purposes of Section 3.6, SCPIE Holdings Inc., a Delaware corporation ("SCPIE
Holdings").

                                    RECITALS
                                    --------

                  WHEREAS, Employer has employed Executive as the Senior Vice
President in charge of the Assumed Reinsurance Division of the insurance company
subsidiaries of SCPIE Holdings (such companies collectively referred to as the
"SCPIE Companies") pursuant to the terms of an Agreement Regarding Employment
Relationship effective as of August 1, 1999 between Employer and Executive (the
"1999 Agreement"); and

                  WHEREAS, Employer desires to be assured of the continued
employment of Executive in such capacity for the term of this Agreement, on the
terms and conditions set forth below; and

                  WHEREAS, Executive desires and is willing to continue his
employment with Employer for the term of this Agreement, on such terms and
conditions set forth below; and

                  WHEREAS, Employer and Executive desire to enter into this
Agreement to supercede in its entirety the 1999 Agreement.

                  NOW, THEREFORE, in consideration of the foregoing recitals and
the respective covenants and agreements of the parties contained in this
document, Employer and Executive agree as follows:

                                    ARTICLE I

                              EMPLOYMENT AND DUTIES
                              ---------------------

                  1.1 Position and Duties. Executive shall serve as a Senior
                      -------------------
Vice President of Employer and the senior executive officer of the Assumed
Reinsurance Division of the SCPIE Companies. Executive shall report directly to
the President and Chief Executive Officer of Employer, and shall discharge such
duties as are assigned to him from time as the senior executive officer of such
Assumed Reinsurance Division in a diligent and professional manner, on a
full-time basis and to devote his best efforts and his entire attention and
energy to such duties. During the Employment Term (as defined below), Employer
shall not reduce Executive's duties, position or responsibilities in a manner
inconsistent with Executive's status as Senior Vice President of Employer and
the senior executive officer of the Assumed Reinsurance Division without
Executive's express prior written consent.

                  1.2 Location. The place of employment of Executive shall be
                      --------
at Employer's offices located in Summit, New Jersey. During the Employment Term,
Employer shall not

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relocate Executive's assigned place of employment to a location which is more
than 25 miles removed from the current Summit office.

                  1.3 Outside Business Activities Precluded. During his
                      -------------------------------------
employment, Executive shall devote his full business time, energy and ability to
the performance of this Agreement. Executive shall not, without the prior
written consent of Employer, perform other business services of any kind or
engage in any other business activity, with or without compensation. In
addition, Executive shall not, during the term of this Agreement, without the
prior written consent of Employer, engage or prepare to engage in any business
activity adverse to Employer's interests.

                                   ARTICLE II

                                  COMPENSATION
                                  ------------

                  2.1 Salary. For Executive's services hereunder, Employer shall
                      ------
pay as base salary to Executive the amount of five hundred thousand dollars
($500,000) per year during each of the calendar years of the Employment Term
("Base Salary"), prorated for any year in which this Agreement is in effect for
only a portion of the calendar year. Said Base Salary shall be payable in equal
installments in conformity with Employer's normal payroll period.

                  2.2 Bonus. The Board of Directors of Employer may, in its
                      -----
discretion, from time to time award bonuses or other compensation to Executive;
provided, however, that during the time that Employer is a wholly-owned
subsidiary of SCPIE Holdings, Employer shall not provide any bonuses or
additional compensation under this Section 2.2 unless such bonus or increase has
been specifically approved in writing by SCPIE Holdings.

                  2.3 Other Benefits. During the Employment Term, Executive
                      --------------
shall be entitled to participate in and receive all other benefits of employment
available to Employer's other senior executive management personnel, including,
but not limited to, inclusion in Employer's retirement plans, medical plans
(including family coverage), life insurance and disability plans, vacation and
sick leave policies and other similar benefit plans, subject to, on a basis
consistent with and to the extent permitted by the terms, conditions and overall
administration of such plans. Employer may, in its sole discretion, grant such
additional benefits to Executive from time to time as Employer deems proper and
desirable.

                  2.4 Expenses. Executive shall be entitled to receive prompt
                      --------
reimbursement for all travel and reasonable business-related expenses incurred
by him during the Employment Term, including reimbursement for Executive's
travel-related expenses incurred in connection with domestic and foreign travel
in the course of discharging his duties to Employer, such reimbursements to be
made in accordance with the policies and procedures from time to time adopted by
Employer, provided that Executive properly accounts for such business expenses
in accordance with Employer's policies.

                  2.5 Deductions and Withholdings. All amounts payable or which
                      ---------------------------
become payable under any provision of this Agreement shall be subject to any
deductions authorized by Executive and any deductions, taxes and withholdings
required by law.

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                                   ARTICLE III

                               TERM OF EMPLOYMENT
                               ------------------

                  3.1 Term. The term of this Agreement shall commence on May 1,
                      ----
2002 and, unless terminated earlier in accordance with this Agreement, shall
continue until April 30, 2005 (the "Employment Term"). The parties agree that
not less than six months prior to the expiration of the Employment Term, they
shall meet to discuss the possible extension of this Agreement.

                  3.2 Termination for Cause. Executive's employment may be
                      ---------------------
terminated for Cause by the Board of Directors of Employer. Termination for
"Cause" shall mean (a) Executive's conviction of a felony involving moral
turpitude or (b) Executive's intentional or repeated failure to perform his
duties or obligations under this Agreement in any material respect, or his
intentional or repeated misconduct in the performance of such duties, in each
case after notice to Executive from the President of Employer which notice
specifies the nature of the failure or misconduct and refers specifically to
this Section 3.2 and a reasonable opportunity for Executive to correct such
failure or misconduct.

                  3.3 Termination Due to Death. Executive's employment
                      ------------------------
hereunder shall terminate immediately upon his death.


                  3.4 Termination Due to Disability. If, at the end of any
                      -----------------------------
month, Executive then is and has been, either for the four consecutive full
calendar months then ending or on sixty percent or more of his normal working
days during the six consecutive full calendar months then ending, unable due to
mental or physical illness or injury to perform his duties under this Agreement
in his normal and regular manner, then Employer may terminate Executive's
employment hereunder upon written notice to Executive.

                  3.5 Termination of Compensation and Benefits After Termination
                      ----------------------------------------------------------
of Employment. Upon termination of employment under this Agreement under Section
-------------
3.2 (Termination for Cause), all salary and benefits of Executive hereunder
shall cease immediately; provided that Executive shall be entitled to receive
his accrued but unpaid prorated Base Salary up to and including the date of such
termination including earned but unused vacation. Upon termination of employment
under Section 3.3 (Termination Due to Death), all earned but unused vacation
shall be paid to the estate of Executive promptly and all Base Salary and, to
the extent permitted by the applicable plan documents, benefits of Executive
hereunder shall continue to be paid and provided until the last day of the third
full month following death. Upon termination of employment under this Agreement
under Section 3.4 (Termination Due to Disability) Executive shall be entitled to
receive (i) his accrued but unpaid prorated Base Salary up to and including the
date of such termination including earned but unused vacation, plus (ii)
additional compensation equal to the amount payable to Executive hereunder for
six months, plus (iii) to the extent permitted by the applicable plan documents,
all benefits for such six month period. All Base Salary (if any) payable under
this Section 3.5 shall be payable in equal installments in conformity with
Employer's normal payroll period.

                  3.6 Change in Control. In consideration of the compensation
                      -----------------
and other benefits provided by Employer under this Agreement, Executive,
Employer and SCPIE Holdings agree that

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that certain letter agreement, dated as of December 14, 2000, between SCPIE
Holdings and Executive, including any rights to receive payments thereunder, for
any Change in Control, as defined therein, occurring on or before April 30,
2003, and all other obligations of the parties thereunder, is hereby terminated
effective as of the date hereof and shall have no further force or effect.

                                   ARTICLE IV

                            CONFIDENTIAL INFORMATION
                            ------------------------

                  4.1 Confidential Information. Executive acknowledges and
                      ------------------------
agrees that the information, observations and data obtained by Executive
(whether in written form or orally) concerning the business or affairs of
Employer or any of its subsidiaries and affiliates, including, without
limitation, trade "know-how" secrets, customer lists, pricing policies,
operational methods, technical processes, formulae, inventions and research
projects, financial information, organizational and personnel matters, policies,
procedures and other non-public matters (and those of third parties) in the
course of Executive's employment with Employer prior to or after the date of
this Agreement ("Confidential Information") are the property of Employer or such
subsidiaries and affiliates. In consideration of, and as a condition to
continued access to, Confidential Information, and without prejudice to or
limitation on any other confidentiality obligations imposed by agreement or by
law, Executive hereby undertakes to use and protect all Confidential Information
in accordance with any restrictions placed on its use or disclosure. Without
limiting the foregoing, except as authorized by Employer or as required by law,
Executive may not disclose or allow disclosure of any Confidential Information,
or of any information derived therefrom, in whatever form, to any person unless
such person is a director, officer, employee, attorney or agent of Employer and,
in Executive's reasonable good faith judgment, has a need to know the
Confidential Information or information derived therefrom in furtherance of the
business of Employer. As used herein, Confidential Information shall not include
information which is generally known to the public or which is made available to
Executive by a source outside Employer which source is not bound by any
obligation of confidentiality to Employer.

                                    ARTICLE V

                               GENERAL PROVISIONS
                               ------------------

                  5.1 Entire Agreement. This Agreement contains the entire
                      ----------------
understanding and sole and entire agreement between the parties with respect to
the subject matter hereof and supersedes any and all prior agreements,
negotiations and discussions between the parties hereto with respect to the
subject matter covered hereby. Each party to this Agreement acknowledges that no
representations, inducements, promises or agreements, oral or otherwise, have
been made by any party, or anyone acting on behalf of any party, which are not
embodied herein, and that no other agreement, statement or promise not contained
in this Agreement shall be valid or binding. This Agreement may not be modified
or amended by oral agreement, but rather only by an agreement in writing signed
by Executive and a member of the Board of Directors of Employer which
specifically states the intent of the parties to amend this Agreement. In the
event there is a conflict between this Agreement and any other agreement the
terms of this Agreement shall govern.

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                  5.2 Successors and Assignment. Neither this Agreement nor the
                      -------------------------
rights or obligations hereunder shall be assignable by Executive. Employer may
assign this Agreement only to any entity which succeeds to the entire business
of Employer, and upon such assignment any such successor shall be deemed
substituted for Employer upon the terms and subject to the conditions hereof.

                  5.3 Dispute Resolution. Any controversy or claim arising out
                      ------------------
of or relating to this Agreement, or the breach thereof, that cannot be resolved
between the parties in a timely manner shall be resolved through final and
binding arbitration before a single neutral arbitrator in Los Angeles,
California in accordance with the then-existing National Rules for Resolution of
Employment Disputes (the "Rules") of the American Arbitration Association
("AAA"), and judgment upon the award rendered by the arbitrator may be entered
in any court having competent jurisdiction thereof; provided, however, that the
law applicable to any controversy shall be the law of the State of California,
regardless of its or any other jurisdiction's choice of law principles.
Notwithstanding the above, nothing herein shall require Employer to arbitrate
any claim involving alleged breaches by Executive of his duties to maintain the
confidentiality of Employer's or any of Employer's affiliates' confidential or
proprietary information, including trade secrets. Such claims may be the subject
of a court action seeking legal or equitable relief. In addition, nothing herein
shall preclude Executive from seeking court action to obtain interim remedies
against Employer for Employer's breach of its obligations to Executive.

                  5.4 No Waiver. No waiver of any term, provision or condition
                      ---------
of this Agreement, whether by conduct or otherwise, in any one or more instances
shall be deemed or be construed as a further or continuing waiver of any such
term, provision or condition, or as a waiver of any other term, provision or
condition of this Agreement.

                  5.5 Governing Law; Rules of Construction. This Agreement has
                      ------------------------------------
been negotiated and executed in, and shall be governed by and construed in
accordance with the laws of, the State of California. Captions of the several
Articles and Sections of this Agreement are for convenience of reference only,
and shall not be considered or referred to in resolving questions of
interpretation with respect to this Agreement.

                  5.6 Notices. Any notice, request, demand or other
                      -------
communication required or permitted hereunder shall be deemed to be properly
given when personally served in writing, when received by the other party, or
when sent by overnight delivery via FedEx or comparable service and addressed to
Employer or Executive at his or its last-known address. Each party may change
its address by written notice in accordance with this Section or via facsimile
or e-mail.

                  Address for Employer:

                           SCPIE Management Company
                           1888 Century Park East
                           Suite 800
                           Los Angeles, California  90067
                           Attn:  Chief Executive Officer

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                  Address for Executive:

                           Timothy C. Rivers
                           329 Mountain Avenue
                           Westfield, New Jersey 07090

                  5.7 Severability. The provisions of this Agreement are
                      ------------
severable. If any provision of this Agreement shall be held to be invalid or
otherwise unenforceable, in whole or in part, the remainder of the provisions or
enforceable parts hereof shall not be affected thereby and shall be enforced to
the fullest extent permitted by law.

                  5.8 Multiple Counterparts. This Agreement may be executed in
                      ---------------------
one or more counterparts, including facsimile, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.

                  5.9 Amendment of 1999 Agreement. The 1999 Agreement between
                      ---------------------------
Executive and Employer is hereby amended and restated in its entirety by this
Employment Agreement.

                            [Signature Page Follows]


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                  IN WITNESS  WHEREOF,  this Agreement has been executed and

delivered by the parties hereto as of the date first above written.

                                   SCPIE MANAGEMENT COMPANY


                                   By:      /s/ DONALD J. ZUK
                                        ----------------------------------------
                                   Name: Donald J. Zuk

                                   Its:  President and Chief Executive Officer

                                   EXECUTIVE

                                     /s/ TIMOTHY C. RIVERS
                                   ---------------------------------------------
                                   Timothy C. Rivers

                  IN WITNESS WHEREOF, SCPIE Holdings Inc. has executed this
Employment Agreement to become a party hereto solely for the purposes of Section
3.6.


                                   SCPIE HOLDINGS INC.


                                   By:      /s/ DONALD J. ZUK
                                        ----------------------------------------
                                   Name: Donald J. Zuk

                                   Its:  President and Chief Executive Officer

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                                   GUARANTY

         1. FOR VALUE RECEIVED and in consideration for, and as an inducement to
Timothy C. Rivers (the "Executive") concurrently entering into an Employment
Agreement dated as of May 1, 2002, with SCPIE Management Company, SCPIE Holdings
Inc. ("SCPIE Holdings") absolutely, irrevocably and unconditionally guarantees
to Executive, and his successors and assigns, the full and timely payment by
SCPIE Management Company to Executive of the compensation required to be paid
and benefits required to be provided by SCPIE Management Company to Executive
under Article II or Article III of said Agreement on the terms and conditions
set forth in said Agreement.

         2. This Guaranty is a guaranty of payment, not collection, and
Executive shall not be required to first pursue his remedies against SCPIE
Management Company but may instead proceed to enforce all of his rights and
remedies directly against SCPIE Holdings or against SCPIE Management Company and
SCPIE Holdings at the same time. This Guaranty cannot otherwise be terminated or
modified without the written consent of Executive. Guarantor hereby waives
notice of acceptance of this Guaranty, as well as all demands, presentments,
notices of protest and notices of every kind and nature.

3. If any dispute arises pertaining to this Guaranty, such dispute will be
submitted to binding arbitration in accordance with the Rules of the American
Arbitration Association before a single neutral arbitrator, such arbitration to
take place in New York, New York and judgment upon such award rendered by the
arbitrator may be entered in any court having jurisdiction.

         Executed in Los Angeles, California, as of May 1, 2002.

                                   SCPIE HOLDINGS INC.


                                   By:      /s/ DONALD J. ZUK
                                       -----------------------------------------
                                   Name: Donald J. Zuk
                                   Its: President and Chief Executive Officer