EXHIBIT 10.2




                         1995 LONG TERM INCENTIVE PLAN


                          STOCK OPTION AWARD AGREEMENT


                                    BETWEEN


                      ALEXANDER & ALEXANDER SERVICES INC.


                                      AND

                         ---------------------------
                                 ("Employee")



        Alexander & Alexander Services Inc. (the "Company"), by action of the
Compensation, Benefits and Nominating Committee of its Board of Directors (the
"Committee") pursuant to the 1995 Long Term Incentive Plan (the "Plan") has
granted to the Employee, as of __________, an option (the "Option") to purchase
_______ shares of the Common Stock, $1 par value (the "Stock"), of the Company
at $________ per share, which is the closing price of the Stock on the New York
Stock Exchange on the date of grant. The Option is intended to be a "non
qualified option" within the meaning of Section 2(j) of the Plan. The terms of
this Agreement shall pertain to the Option except as otherwise provided.

        The Option is subject in all respects to the provisions of the Plan, a
copy of which has been furnished to the Employee and receipt of which the
Employee acknowledges by acceptance of this Agreement. The Plan is incorporated
by reference into this Agreement.

        In addition to the provisions of the Plan, the following terms,
conditions and restrictions are applicable to the Option:

        (a) Neither the Option nor any part thereof may be exercised unless and
until any Stock to be received upon exercise of the Option shall be listed or
approved for listing on the New York Stock Exchange and registered under the


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<PAGE>

Securities Act of 1933, unless the issuance of the Stock shall, in the opinion
of counsel to the Company, be exempt from registration.

        (b) Subject to the provisions of subparagraph (a) of this Agreement,
the Option shall be exercisable as to an initial installment of not more than
50% of the total number of shares covered hereby on and after_________, and an
additional installment of 50% on or after __________. Each installment shall
remain exercisable until _____________ (the "Expiration Date"), a date 10 years
from the date of grant, or such earlier date as (1) all shares covered by the
Option shall have been purchased or (2) the Option shall have expired as
provided in Section 6.1(g) of the Plan. To the extent not exercised,
installments shall accumulate, provided that the Option shall expire in any
event on the Expiration Date. To the extent that any installment or part of any
installment of the Option may not be exercised as provided for above because
shares of Stock are not registered under the Securities Act of 1933 or the
issuance of Stock, in the opinion of counsel to the Company, is not exempt from
registration, then such installment or part of such installment shall become
exercisable when shares of Stock first become registered or the issuance of
shares of Stock may be exempt, but in no event prior to the times set forth
above or after the Expiration Date.

        (c) Notwithstanding paragraph (b) of this Agreement, the Option shall
become exercisable commencing on the date of a "change of control" of the
Company under the terms and conditions specified in Section 9.12 of the Plan.

        (d) The Option shall not be transferable by the Employee otherwise than
by will and the laws of descent and distribution. During the Employee's
lifetime, the Option shall be exercisable only by the Employee. Any attempt by
the Employee to transfer, assign, pledge, hypothecate or otherwise dispose of,
or any attempt to subject to execution, attachment or similar process, any part
of the Option, contrary to the provisions of the Plan and this Agreement shall
be void and ineffectual, shall give no right to the purported transferee, and
shall result in the forfeiture of the Option.

        (e) Any question concerning Termination of Employment, Disability,
Retirement, or changes in employment status specified in Section 9.2 of the
Plan, shall be determined by the Committee, whose determination shall be final.


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<PAGE>

 
        (f) Nothing contained in this Agreement shall restrict the right of the
Company or any of its Subsidiary companies to terminate the Employee's
employment at any time, with or without cause. Termination of Employment,
whether by the Company or any of its Subsidiary companies or otherwise, and
regardless of the reason therefore, shall have the results provided for in the
relevant sections of the Plan and this Agreement.

        (g) Subject to the terms and conditions set forth in this Agreement and
in the Plan, the Option shall be exercised by notice to the Plan administrator
as designated from time to time by the Company. Information concerning the
procedures and requirements for exercising the Option shall be made available
to the Employee on or before the first date on which any portion of the Option
becomes exercisable.

        (h) The date of the exercise of the Option with respect to any
particular shares shall be the date on which the notice and payment, as
specified by the Plan administrator, shall be received by the Company or its
agent.

        (i) In addition to the terms and conditions of this Agreement and the
provisions of the Plan, the Option is subject to execution by the Employee of
the attached Non-Competition Agreement which is hereby incorporated into this
Agreement by reference.


In consideration of the Option covered by this Agreement, and for other good
and valuable consideration, the parties hereto indicate their agreement by
their signatures below.




ALEXANDER & ALEXANDER SERVICES INC.




---------------------------------------------


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<PAGE>


Pursuant to Section 4.5 of the Plan, the Employee's right to the Option covered
by this Agreement is subject to execution of the Agreement. Please indicate
acceptance of the Option covered by this Agreement, subject to the restrictions
and upon the terms and conditions set forth above and in the Plan, by executing
this Agreement and the attached Non-Competition Agreement (in duplicate) and


immediately returning one copy to ________________________________. It will be
assumed that the Option has been declined if acceptance has not been received
within thirty (30) days of the receipt of this Agreement.




        ACCEPTED & AGREED TO:




        -------------------------------------------      -----------------
        EMPLOYEE'S SIGNATURE                             DATE





<PAGE>


                         1995 LONG-TERM INCENTIVE PLAN

                        RESTRICTED STOCK AWARD AGREEMENT
                        --------------------------------

                                    BETWEEN

                      ALEXANDER & ALEXANDER SERVICES INC.

                                      AND

------------------
("Employee")

Effective __________________ ("Date of Grant"), the Compensation, Benefits and
Nominating Committee (the "Committee") of the Board of Directors of Alexander &
Alexander Services Inc. (the "Company") awarded to the Employee ______ shares
(the "Shares") of the Company's Common Stock, $1.00 par value (the "Stock"),
subject to the terms and conditions described below (the "Restricted Stock
Award").

The Restricted Stock Award is made pursuant to and is subject in all respects,
to the provisions of the 1995 Long-Term Incentive Plan (the "Plan"), a copy of
which has been furnished to the Employee and receipt of which the Employee
acknowledges by acceptance of this Agreement. The Plan is incorporated by
reference into this Agreement.The Plan will control if there is any conflict
between the Plan and this Agreement, and on such matters as are not contained
in this Agreement. Capitalized terms not defined in this Agreement have the
meanings given to them in the Plan.

In addition to the provisions of the Plan, the following terms and conditions
set forth in this Agreement are applicable to the Restricted Stock Award.

1.      RESTRICTIONS ON DISPOSITION OF SHARES
        -------------------------------------

The Employee agrees not to sell, exchange, transfer, pledge, hypothecate or
otherwise dispose of any Shares (or any new, additional


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or different shares of Stock received pursuant to Section 3 of the Plan), for 
those periods of time (the "Restricted Periods") ending on the following dates:

        a)  With  respect  to 50% of the  Shares,  on that date  which is two 
            years  after the Date of Grant: and

        b)  With  respect to 50% of the  Shares,  on that date which is three
            years after the Date of Grant;

provided, however, that the Restricted Periods shall end earlier as provided in
Section 6.3(d) of the Plan.

        The foregoing restrictions shall be in addition to any restriction on
        the Employee's ability to sell, exchange, transfer, pledge, hypothecate
        or otherwise dispose of the Shares under the Federal or any state
        securities laws. Any attempt by the Employee to sell, transfer, pledge
        assign or otherwise dispose of the Shares shall constitute immediate
        forfeiture of the Restricted Stock Award.

2.      ISSUANCE OF SHARES
        ------------------
        Upon receipt of a signed copy of this Agreement by the Company or its
        agent, the Shares shall be issued to the Employee, who shall thereupon
        be a stockholder with respect thereto. The Employee shall have the
        right to vote such Shares and to receive all dividends and
        distributions paid with respect to such Shares, but the right to sell
        or otherwise dispose of them shall be subject to the restrictions
        specified in Paragraph 1 of this Agreement.

3.      LAPSE OF RESTRICTIONS
        ---------------------
        The restrictions imposed in Paragraph 1 of this Agreement shall lapse
        upon the expiration of each relevant Restricted Period and the stated
        percentage of the Shares shall thereupon be free and clear of the
        restrictions imposed in Paragraph 1 of this Agreement.

4.      CHANGE OF CONTROL
        -----------------


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        Notwithstanding Paragraph 3 of this Agreement, the restrictions imposed
        in Paragraph 1 of this Agreement shall lapse commencing on the date of
        a "change of control" of the Company under the terms and conditions
        specified in Section 9.12 of the Plan.

5.      INVESTMENT REPRESENTATIONS
        --------------------------
        The Employee consents and agrees that he or she will make no
        distribution of the Shares in violation of the Securities Act of 1933,
        as amended, or any other federal or state securities statutes, rules or
        regulations.

6.      NON-COMPETITION AGREEMENT
        -------------------------
        In consideration of the Restricted Stock Award and the Employee's
        employment with the Company, the Employee agrees to the terms of the
        Non-Competition Agreement set forth in Exhibit A to this Agreement. Any
        agreements on the same or similar subject matter heretofore entered
        into between the Employee and the Company or any of its Subsidiaries
        are hereby confirmed, shall remain in full force and effect and shall
        not be terminated, amended or otherwise modified as a result of the
        Employee's agreement to the terms of Exhibit A or as a result of any
        invalidity or unenforceability in whole or in part of any of the terms
        of Exhibit A.

7.      INTERPRETATION, ETC.
        ------------------
        The Plan and this Agreement shall be administered by the Committee in
        accordance with the applicable provisions of the Plan. All
        determinations by the Committee as to any matter, including matters of
        interpretation of this Agreement and the Plan and questions concerning
        Termination of Employment, Disability, Retirement or those changes in
        employment status specified in Section 9.2 of the Plan shall be
        conclusive and binding upon the Employee.

8.      INCOME TAX WITHHOLDING
        ----------------------
        To the extent necessary, the Employee hereby authorizes the Company to
        withhold from his or her salary any withholding tax 


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        resulting from the Restricted Stock Award as may be required by 
        Federal or state tax law.

9.      MISCELLANEOUS
        -------------
        This Agreement and the Plan embody the entire agreement and
        understanding between the Company and the Employee with respect to the
        Restricted Stock Award and the other matters referred to herein and may
        not be changed, modified or terminated orally but only by a written
        instrument executed by the Employee and the Company. This Agreement
        shall be construed and enforced in accordance with, and governed by,
        the laws of the State of Maryland. The provisions of this Agreement are
        intended to be separate and divisible and if, for any reason, any one
        or more of such provisions should be held to be invalid and
        unenforceable in whole or in part, the Employee agrees that the same
        shall not be held to affect the validity or enforceability of any other
        provision of this Agreement. Nothing contained in this Agreement or in
        the Plan shall restrict the right of the Company or any of its
        Subsidiaries to terminate the Employee's employment at any time, with
        or without cause. The Termination of Employment, whether by the Company
        or any of its Subsidiaries or otherwise, regardless of the reason
        therefore, shall have the results provided for in Section 6.3(d) of the
        Plan.

ALEXANDER & ALEXANDER SERVICES INC.




By:_______________________________


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<PAGE>


Pursuant to Section 4.5 of the Plan, the Employee's right to the Restricted
Stock Award covered by this Agreement is subject to execution of this Agreement
and of the associated Non-Competition Agreement. Please indicate acceptance of
the Restricted Stock Award covered by this Agreement, subject to the
restrictions and upon the terms and conditions set forth above and in the Plan,
by executing this Agreement and the attached Non-Competition Agreement (in
duplicate) and immediately returning one original set to________________

------------------------------------------------------------------.

If all the above are not received within the 30 day period, the Restricted
Stock Award granted under this Agreement shall be forfeited.




ACCEPTED AND AGREED TO:




----------------------------                       -----------------------------
Employee's Signature


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<PAGE>



                         1995 LONG TERM INCENTIVE PLAN
                         -----------------------------

                   LIMITED STOCK APPRECIATION RIGHT AGREEMENT

                                    BETWEEN

                      ALEXANDER & ALEXANDER SERVICES INC.

                                      AND


                             --------------------
                                 ("EMPLOYEE")

        Alexander & Alexander Services Inc. (the "Company"), by action of the
Compensation, Benefits and Nominating Committee of the Board of Directors (the
"Committee") pursuant to the 1995 Long Term Incentive Plan (the "Plan") has
granted to the Employee Limited Stock Appreciation Rights ("LSAR") with respect
to the shares of the Company's Common Stock, $1.00 par value (the "Stock"),
subject to the option (the "Option") granted to the Employee under the Plan on
______________.

        The LSAR is subject to the provisions of the Plan, a copy of which has
been furnished to the Employee and receipt of which the Employee acknowledges
by acceptance of this Agreement. The Plan is incorporated by reference into
this Agreement.

        In addition to the provisions of the Plan, the following terms,
conditions and restrictions set forth in this Agreement are applicable to the
LSAR:

               (a) The Employee's right to exercise the LSAR shall begin on the
date which is 6 months from the date on which it is granted and shall terminate
on the latest of the following (i) such time as the Employee is no longer
subject to the provisions of Section 16(b) of the Securities Exchange Act of
1934; (ii) the occurrence of an event specified in Section 6.2(b)(iii) of the
Plan; or (iii) subject to the provisions of subparagraph (b) below, the
exercise in full of the Option. The right of an Employee who is no longer
subject to the provisions of Section 16(b) of the Act to exercise his Option
shall continue as provided in Section 6.1 of the Plan.


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<PAGE>


        (b) In the event that the Employee is issued a Replacement Option under
the conditions specified in subparagraph (i) of the Option agreement and
Section 6.1(f) of the Plan, the LSAR shall not terminate upon exercise of the
Option but instead shall automatically apply to the shares subject to the
Replacement Option. The Employee's right to exercise the LSAR related to the
Replacement Option shares shall begin on the date which is 6 months from the
date the Replacement Option is issued and shall terminate as specified in
subparagraph (a) above. If further Replacement Options are issued upon exercise
in full or in part of the Option, this subparagraph (b) shall apply to those
later Replacement Options.

        (c) The LSAR shall be exercisable only by the Employee. Any attempt by
the Employee to transfer, assign, pledge, hypothecate or otherwise dispose of,
or any attempt to subject to execution, attachment or similar process, any part
of the LSAR, contrary to the provisions of the Plan and this Agreement shall be
void and ineffectual, shall give no right to the purported transferee, and
shall result in the forfeiture of the LSAR.

        (d) Any question concerning Termination of Employment, Disability,
Retirement or changes in employment status specified in Section 9.2 of the
Plan, shall be determined by the Committee, whose determination shall be final.

        (e) Nothing contained in this Agreement shall restrict the right of the
Company or any of its subsidiary Companys to terminate the Employee's
employment at any time, with or without cause.

        (f) The Employee may exercise the LSAR, or any portion thereof, in lieu
of the Option. Exercise of the LSAR shall be by written notice to the Company
or its agent and shall be subject to the terms and conditions set forth in the
Plan. Any exercise of the LSAR shall result in the cancellation of a
corresponding portion of the underlying Option and any exercise of the
underlying Option shall result in the cancellation of a corresponding portion
of this LSAR.

        (g) For a period of 30 days following the later to occur of (i) a
"change of control" as defined in Section 9.12 of the Plan and (ii) the date
which is 6 months after the date of grant the Employee may surrender all or a
portion of his Option in exchange for an amount in cash equal to the product of
(x) the number of shares subject to the Option being so surrendered times (y)
(A) the excess of (1) the highest price offered in connection with any
purchase, tender offer, merger or other transaction resulting in a "change of
control" or (2) if a "change of control" occurs by reason of a change in the
composition of the Board of Directors, the highest average of the high and low
sales prices of a share of Stock on the New York Stock Exchange on any date
during the thirty calendar day period ending on the date the change in the
composition of the Board occurs over (B) the exercise price of the Option.


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        (g) The LSAR shall be deemed not to have been exercised unless all the
preceding provisions of this Agreement shall have been complied with, and for
all purposes of the Plan, the date of the exercise with respect to any
particular shares shall be the date on which the notice specified in paragraph
(e) above has been received by the Company or its agent.

In consideration of the LSAR covered by this Agreement, and for other good and
valuable consideration, the parties hereto indicate their agreement by their
signatures below.

ALEXANDER & ALEXANDER SERVICES INC.




---------------------------------------------




Pursuant to Paragraph 4.5 of the Plan, the Employee's right to the LSAR covered
by this Agreement is subject to execution of the Agreement. Please indicate
acceptance of the LSAR covered by this Agreement, subject to the restrictions
and upon the terms and conditions set forth above and in the Plan, by executing
this Agreement (in duplicate) and immediately returning the enclosed duplicate
original (one copy) to _____________ ___________________. It will be assumed
that the LSAR has been declined if acceptance has not been received within
thirty (30) days of the receipt of this Agreement.




        ACCEPTED & AGREED TO:




        ------------------------------------              -------------------
        EMPLOYEE'S SIGNATURE


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