<PAGE>   1

                              EMPLOYMENT AGREEMENT


            EMPLOYMENT AGREEMENT, dated as of December 21, 1995, by and
between Aetna Life and Casualty Company, a Connecticut corporation (the
"Company"), and Fredrick C. Copeland, Jr. ("Executive").


                              W I T N E S S E T H:

            WHEREAS, the Company is considering certain restructuring
alternatives that could result in significant changes in the structure of its
business, including, without limitation, dividing the business of the Company
into two or more separate publicly traded companies or otherwise transferring a
portion of the business to a third party;

            WHEREAS, the Company believes that Executive is a key employee and
that it is in the Company's best interests to retain the services of Executive
for the period during which such restructuring alternatives are considered and,
to the extent applicable, implemented;

            WHEREAS, the Company therefore desires to retain the services of
Executive and to enter into an agreement embodying the terms of such employment
(the "Agreement"); and

            WHEREAS, Executive desires to accept such employment and enter
into such Agreement;

            NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the Company and Executive hereby agree as follows:

            1. Employment. Except as provided in Paragraph 6(a), the Company
shall continue to employ Executive and Executive agrees to remain employed by
the Company under the terms of this Agreement for the period commencing on the
date first written above and ending December 8, 1998. The period during which
Executive is employed pursuant to this Agreement shall be referred to as the
"Contract Employment Period". Upon the expiration of the Contract Employment
Period, Executive's employment with the Company shall continue on an at-will
basis.

            2. Position and Duties. During the Contract Employment Period,
Executive shall serve in Executive's current position and in such other
comparable or better position or positions with the Company and its subsidiaries
as the Chief Executive Officer or the Board of Directors of the Company (the
"Board") shall specify from time to time. During the Contract Employment Period,
Executive shall have the duties, responsibilities and obligations customarily
assigned to individuals serving in the position or positions in which Executive
serves hereunder and such other duties, responsibilities and obligations as the
Chief Executive Officer or the Board shall from time to time specify. Executive
shall devote his full business time to the


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services required of him hereunder, except for vacation time and reasonable
periods of absence due to sickness, personal injury or other disability, and
shall use his best efforts, judgment, skill and energy to perform such services
in a manner consistent with the duties of his position and to improve and
advance the business and interests of the Company and its subsidiaries. Nothing
contained herein shall preclude Executive from (i) serving on any corporate or
governmental board of directors on which he currently serves or, if the Board
consents to such service, on any other board of directors, (ii) serving on the
board of, or working for, any charitable, not-for profit or community
organization, (iii) pursuing any other activity to which the Board consents or
(iv) pursuing his personal, financial and legal affairs, so long as such
activities, individually or collectively, do not interfere with the performance
of Executive's duties hereunder.

            3. Cash Compensation.

            a. Base Salary. During the Contract Employment Period, the Company
shall pay Executive a base salary at the annual rate of $300,000. The Board
shall periodically review Executive's base salary and the Company may, in its
discretion, increase such base salary by an amount it determines to be
appropriate. Any such increase shall not reduce or limit any other obligation of
the Company hereunder. Executive's annual base salary payable hereunder, as it
may be increased from time to time and without reduction for any amounts
deferred as described above, is referred to herein as "Base Salary". Executive's
Base Salary, as in effect from time to time, may not be reduced by the Company
without Executive's consent, provided that the Base Salary payable under this
paragraph shall be reduced to the extent Executive elects to defer or reduce
such salary under the terms of any deferred compensation or savings plan or
other employee benefit arrangement maintained or established by the Company. The
Company shall pay Executive the portion of his Base Salary not deferred in
accordance with its customary periodic payroll practices.

            b. Incentive Compensation. During the term of the Contract
Employment Period, Executive shall remain eligible for participation in the
Company's existing and future annual and long term incentive compensation
programs at a level consistent with his position at the Company and the
Company's then current policies and practices; provided that following any
assignment of this Agreement in accordance with the provisions of Paragraph 9(c)
or a Change in Control of the Company (as defined in Paragraph 7(e)), the
calculation of the amount payable as annual incentive compensation and the
conditions upon which such bonus shall be payable shall be no less favorable to
the Executive (taking into account reasonable changes in the Company's goals and
objectives) than the annual bonus opportunity that had been made available to
the Executive for the fiscal year ended immediately prior to such assignment or
Change in Control. Without limiting the generality of the foregoing, for each
calendar year ending during the term hereof, Executive shall receive the
opportunity to receive an annual bonus of at least 60% of his Base Salary (the
"Minimum Bonus Percentage"), subject to satisfaction of such reasonable
performance criteria as shall be established with respect to such year.

            4. Stock Option Grant. Contingent upon the execution of this
Agreement by the Executive, the Company has granted Executive an option, having
a ten-year term, to purchase 35,000 shares of the Company's Common Stock at an
exercise price per share equal to $71.625 a 


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share (the "Option"). Except to the extent specified below, the terms of the
Option shall be determined in accordance with the terms of the 1994 Stock
Incentive Plan (the "1994 Plan") and shall be set forth in the separate
agreement embodying the grant of such Option (the "Option Agreement"), the form
of which is attached hereto as Exhibit A.

            5. Benefits, Perquisites and Expenses.

            a. Benefits. During the Contract Employment Period, Executive shall
be eligible to participate in (i) each welfare benefit plan sponsored or
maintained by the Company, including, without limitation, each group life,
hospitalization, medical, dental, health, accident or disability insurance or
similar plan or program of the Company, and (ii) each pension, profit sharing,
retirement, deferred compensation or savings plan sponsored or maintained by the
Company, in each case, whether now existing or established hereafter, to the
extent that Executive is eligible to participate in any such plan under the
generally applicable provisions thereof. Nothing in this Paragraph 5(a) shall be
construed to limit the ability of the Company to amend or terminate any
particular plan, program or arrangements, provided that, following the
occurrence of a Change in Control (as defined in Paragraph 7(e)) or the
assignment of this Agreement to a New Entity (as defined in Paragraph 6(a))
pursuant to Paragraph 9(b), the benefits made available to the Executive
thereafter shall be at least substantially comparable, in the aggregate, to the
benefits made available to the Executive immediately prior to such Change in
Control or assignment.

            With respect to the pension or retirement benefits payable to
Executive, Executive's service credited for purposes of determining Executive's
benefits and vesting shall be determined in accordance with the terms of the
applicable plan or program or, if applicable, pursuant to any written agreement
between Executive and the Company (whether now existing or hereafter adopted)
that provides Executive a more favorable method of crediting service for any
purpose thereunder.

            b. Perquisites. During the Contract Employment Period, Executive
shall be entitled to receive such perquisites as are generally provided to other
senior officers of the Company in accordance with the then current policies and
practices of the Company.

            c. Business Expenses. During the Contract Employment Period, the
Company shall pay or reimburse Executive for all reasonable expenses incurred or
paid by Executive in the performance of Executive's duties hereunder, upon
presentation of expense statements or vouchers and such other information as the
Company may require and in accordance with the generally applicable policies and
procedures of the Company.


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            6. Termination of Employment.

            a. Early Termination of the Contract Employment Period.
Notwithstanding Paragraph 1, the Contract Employment Period shall end upon the
earliest to occur of (i) a termination of Executive's employment on account of
Executive's death, (ii) a Termination due to Disability, (iii) a Termination for
Cause, (iv) a Termination Without Cause, (v) a Termination for Good Reason or
(vi) a termination of Executive's employment by Executive other than a
Termination for Good Reason. For purposes of this Agreement, a transfer of
Executive's employment (i)to any other entity controlled by or under common
control with the Company shall not be treated as a termination unless and until
such entity ceases to be controlled by or under common control with the Company
or (ii) as a result of the implementation of any restructuring of the Company
(whether occurring by spin-off or otherwise) shall not be treated as a
termination of employment, provided that, in either case, the successor employer
(the "New Entity") expressly assumes and agrees to perform all of the Company's
obligations under this Agreement.

            b. Benefits Payable Upon Termination. Following the end of the
Contract Employment Period pursuant to Paragraph 6(a), Executive (or, in the
event of his death, his surviving spouse, if any, or his estate) shall be paid
the type or types of compensation determined to be payable in accordance with
the following table at the times established pursuant to Paragraph 6(c):


<TABLE>
<CAPTION>
                      Earned       Vested       Accrued       Severance
                      Salary      Benefits       Bonus         Benefit
                      ------      --------      -------       ---------
<S>                   <C>         <C>         <C>            <C>
  Termination due     Payable     Payable       Payable      Not Payable
     to death                                               
                                                            
Termination due to    Payable     Payable       Payable      Not Payable
    Disability                                              
                                                            
  Termination for     Payable     Payable     Not Payable    Not Payable
       Cause                                                
                                                            
    Termination       Payable     Payable       Payable        Payable
   Without Cause                                            
                                                            
  Termination for     Payable     Payable       Payable        Payable
    Good Reason                                             
                                                            
  Termination by      Payable     Payable     Not Payable    Not Payable
  Executive other                                           
   than for Good                                            
      Reason                                                
</TABLE>


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<PAGE>   5

            c. Timing of Payments. Earned Salary and Accrued Bonus shall be paid
in a single lump sum as soon as practicable, but in no event more than 30 days,
following the end of the Contract Employment Period. Vested Benefits shall be
payable in accordance with the terms of the plan, policy, practice, program,
contract or agreement under which such benefits have accrued.

            Severance Benefits shall be paid in approximately equal
installments, at the same intervals at which Executive was receiving his salary
payments hereunder, for the greater of (i) one year, (ii) the period over which
such benefits would be payable if paid to Executive under the Company's
otherwise applicable plans, policies or procedures as currently in effect or
(iii) the period over which such benefits would be payable if paid to Executive
under the Company's otherwise applicable plans, policies or procedures, as in
effect at the time of Executive's termination of employment. Notwithstanding the
foregoing, Executive may elect, by written notice given to the Company prior to
the first periodic payment and within ten business days after such termination,
that, instead of periodic installments, Severance Benefits shall be paid in
either a single lump sum, payable within ten business days of receipt by the
Company of such election, or in two equal installments, the first payable within
ten business days of receipt by the Company of such election, and the second
payable on the first business day of the following calendar year.

            d. Definitions. For purposes of this Paragraph 6, capitalized terms
have the following meanings:

            "Accrued Bonus" means a pro-rated amount equal to the product of (i)
the annual incentive compensation Executive would have been entitled to receive
under Paragraph 3(b) for the calendar year in which his active service for the
Company terminates pursuant to Paragraph 6(a) had he remained employed for the
entire year and assuming that all targets for such year had been met, multiplied
by (ii) a fraction, the numerator of which is equal to the number of days in
such calendar year occurring on or prior to the termination of Executive's
active service for the Company (including any period of absence due to
disability) and the denominator of which is 365.

            "Earned Salary" means any Base Salary earned, but unpaid, for
services rendered to the Company on or prior to the date on which the Contract
Employment Period ends (other than Base Salary deferred pursuant to Executive's
election, as provided in Paragraph 3(a) hereof).

            "Severance Benefit" means an amount equal to the greater of:

      (i)   the sum of

            (A)   the annual Base Salary payable to Executive immediately prior
                  to the end of the Contract Employment Period; and

            (B)   an amount (the "Bonus Severance Amount") equal to the product
                  of Executive's Base Salary times the greater of (1) the
                  Minimum Bonus 


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                  Percentage and (2) the percentage of Base Salary that would
                  have been payable to Executive for the year of such
                  termination assuming achievement of target levels of
                  performance and Executive's continued employment for the
                  entire year, or

      (ii)  the amount otherwise payable to Executive under the Company's
            otherwise applicable severance plans, policies or programs as in
            effect on the date hereof (or, if more favorable to Executive, as
            in effect on the date of Executive's termination), assuming for
            purposes of determining the amount payable thereunder that
            Executive's employment was terminated as a result of the
            elimination of his position, but calculated by including the
            Bonus Severance Amount as part of Executive's eligible
            compensation for purposes of calculating the benefits payable
            under such plans, policies or programs;

except that, in the event that Executive becomes entitled to receive Severance
Benefits hereunder following a Change in Control, the Severance Benefit payable
to Executive shall be determined under Paragraph 7(c). Additionally, while
Executive is receiving payment of Severance Benefits in periodic installments,
Executive shall also be eligible to continue to participate in the welfare
benefit plans and programs (excluding the long-term disability plan, the
sick-pay plan and vacation accruals) generally made available to employees of
the Company and in which he participated immediately prior to the termination of
his employment on the same terms and conditions as would have applied had
Executive continued to be employed. Upon an election to receive Severance
Benefits in either a single lump sum payment or in two installments, Executive
will forfeit any right to continue to receive any coverage under the Company's
welfare benefit plans, other than COBRA coverage (determined from the original
date of termination) at Executive's expense as required by applicable law;
provided that, if Executive elects to receive Severance Benefits in two
installments instead of periodic installments, the Company shall pay one-half of
the cost of Executive's COBRA coverage from the date the first installment
payment is made until the date the second installment payment is made.
Notwithstanding the foregoing, receipt of a lump sum payment or two installment
payments hereunder shall not cause Executive to cease to be eligible for any
retiree benefit programs for which he is otherwise eligible under the terms of
the Company's employee benefit plans, policies or programs.

            "Termination for Cause" means a termination of Executive's
employment by the Company due to (i) the willful failure by Executive to perform
substantially Executive's duties as an employee of the Company (other than due
to physical or mental illness) after reasonable notice to Executive of such
failure, (ii) Executive's engaging in misconduct that is materially injurious to
the Company or any subsidiary or any affiliate of the Company, (iii) Executive's
having been convicted of, or entered a plea of nolo contendere to, a crime that
constitutes a felony, (iv) the material breach by Executive of any written
covenant or agreement not to compete with the Company or any subsidiary or any
affiliate or (v) the breach by Executive of his duty of loyalty to the Company
which shall include, without limitation, (A) the disclosure by Executive of any
confidential information pertaining to the Company or any subsidiary or any
affiliate of the Company, other than (x) in the ordinary course of the
performance of his duties on behalf of the Company or (y) pursuant to a judicial
or administrative subpoena from a court or 


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governmental authority with jurisdiction over the matter in question, (B) the
harmful interference by Executive in the business or operations of the Company
or any subsidiary or any affiliate of the Company, (C) any attempt by Executive
directly or indirectly to induce any employee, insurance agent, insurance broker
or broker-dealer of the Company or any subsidiary or any affiliate to be
employed or perform services elsewhere, other than actions taken by Executive
that are intended to benefit the Company or any subsidiary or affiliate and do
not benefit Executive financially other than as an employee or stockholder of
the Company, (D) any attempt by Executive directly or indirectly to solicit the
trade of any customer or supplier, or prospective customer or supplier, of the
Company on behalf of any person other than the Company or a subsidiary thereof,
other than actions taken by Executive that are intended to benefit the Company
or any subsidiary or affiliate and do not benefit Executive financially other
than as an employee or stockholder of the Company, provided, however, that this
provision shall only apply to any product or service which is in competition
with a product or service of the Company or any subsidiary or affiliate thereof
or (E) any breach or violation of the Company's Code of Conduct, as amended from
time to time sufficient to warrant a for cause termination consistent with the
Company's past practice. Notwithstanding the foregoing, a breach of Executive's
duty of loyalty to the Company as described in subclause (A) or a breach of the
Company's Code of Conduct as described in subclause (E) of clause (v) of the
preceding sentence shall not be grounds for a Termination for Cause unless such
breach has had or could reasonably be expected to have a significant adverse
effect on the business or reputation of the Company.

            "Termination due to Disability" means a termination of Executive's
employment by the Company because Executive has been incapable, with or without
reasonable accommodation, of substantially fulfilling the positions, essential
duties, responsibilities and obligations of Executive's positions set forth in
this Agreement because of physical, mental or emotional incapacity resulting
from injury, sickness or disease for a period of (i) at least four consecutive
months or (ii) more than six months in any twelve month period. Any question as
to the existence, extent or potentiality of Executive's disability shall be made
by a qualified, independent physician selected by the chief or assistant chief
(or the equivalent position) of the department which treats the condition giving
rise to Executive's absence at a nationally or regionally recognized teaching
hospital chosen by the Company. The determination of any such physician shall be
final and conclusive for all purposes of this Agreement. Notwithstanding the
foregoing, (i) a Termination for Disability shall not affect Executive's right
to receive any amount that would otherwise have been payable to Executive under
the Company's plans, policies, practices or programs pertaining to short-term or
long-term disability had Executive's employment continued and (ii) if it is
determined, at the time Executive is first eligible to receive long-term
disability benefits under the Company's plans, policies, practices or programs,
that Executive is not entitled to receive such long-term disability benefits
(other than due to Executive's failure to cooperate), Executive shall, for
purposes of this Paragraph 6, be deemed to have been terminated as of the date
of such determination pursuant to a Termination Without Cause and to be entitled
to receive any additional benefits payable hereunder in respect of a Termination
Without Cause.

            "Termination for Good Reason" means a termination of Executive's
employment by Executive within 90 days following actual knowledge of (i) a
reduction in Executive's annual 


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Base Salary or incentive compensation opportunity as provided under Paragraph
3(b), (ii) a material reduction in Executive's positions, duties and
responsibilities from those described in Paragraph 2 hereof, (iii) the
relocation of Executive's principal place of employment to a location more than
50 miles from the location at which he performed his principal duties on the
date immediately prior to such relocation, (iv) a breach of the obligation to
provide Executive with the benefits required to be provided in accordance with
Paragraph 5(a), (v) a failure by the Company to pay any amounts due and owing to
Executive within 10 days following written notice from Executive of such failure
to pay, or (vi) any other material breach of the Company's obligations to
Executive hereunder that materially affects the compensation or benefits payable
to Executive or materially impairs Executive's ability to perform the duties and
responsibilities of his position. Notwithstanding the foregoing, a termination
shall not be treated as a Termination for Good Reason (i) if Executive shall
have consented in writing to the occurrence of the event giving rise to the
claim of Termination for Good Reason or (ii) unless Executive shall have
delivered a written notice to the Chief Executive Officer of the Company within
60 days of his having actual knowledge of the occurrence of one of such events
stating that he intends to terminate his employment for Good Reason and
specifying the factual basis for such termination, and such event shall not have
been cured within 30 days of the receipt of such notice.

            "Termination Without Cause" means any termination of Executive's
employment by the Company other than (i) a Termination due to Disability or (ii)
a Termination for Cause. Subject to the Company's obligations to make the
payments, if any, required pursuant to this paragraph 6, nothing in this
Agreement shall be construed to limit the right of the Company to terminate
Executive's employment at any time for any reason or without reason.

            "Vested Benefits" means amounts payable under the terms of or in
accordance with any plan, policy or practice or program of, or any contract or
agreement with, the Company or any of its subsidiaries (including, without
limitation, any supplemental pension plan, supplemental savings plan or other
deferred compensation arrangement, the 1994 Plan and the Company's 1984 Stock
Option Plan (the "1984 Plan") with respect to which Executive's rights to such
amounts (i) have become vested and nonforfeitable on or before Executive's
termination of employment or (ii) otherwise have or will become nonforfeitable
at or subsequent to his termination of employment without regard to the
performance by Executive of further services or the resolution of a contingency
that is not satisfied at or after such termination, provided that, at any time
during which Executive is entitled to receive the Severance Benefits hereunder,
Executive shall not also be entitled to receive any benefits under the Company's
generally applicable severance or other termination plans, policies or programs.

            e. Full Discharge of Company Obligations. Except to the extent
provided in this Paragraph 6, the amounts payable to Executive pursuant to this
Paragraph 6 shall be in full and complete satisfaction of Executive's rights
under this Agreement and, except to the extent prohibited by law, any other
claims he may have in respect of his employment by the Company or any of its
subsidiaries. Such amounts shall constitute liquidated damages with respect to
any and all such rights and claims and shall not be subject to any offset or
mitigation. Notwithstanding anything else contained herein to the contrary,
unless the Company shall waive its rights to any such release, the Company's
obligations under this Paragraph 6 are expressly 


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conditioned upon Executive's execution simultaneously with or immediately
following such termination of employment, of a release and waiver, substantially
in the form attached hereto as Exhibit B (subject to, in the event any change of
law occurring after the date hereof, to such modifications as shall be necessary
or appropriate to place the Company in a substantially the same position as
though no change in law had occurred), of any claims he may have in connection
with the termination of, or arising out of, his employment with the Company,
provided that such release shall not be construed to waive, release or otherwise
limit any amounts required to be paid hereunder or any benefits due and payable
to Executive under the terms of any employee pension benefit plan, as defined in
Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended,
any other Vested Benefit or any right of Executive to be indemnified by the
Company pursuant to its applicable policies and practices from and against any
third party claims arising out of or relating to Executive's employment with or
other services on behalf of the Company or any subsidiary of the Company.

            f. Outplacement Services. In addition to any other benefits
described in this Paragraph 6, in the event Executive is eligible to receive
Severance Benefits, the Company shall also provide to Executive, at its expense,
individual outplacement services from a qualified outplacement firm selected by
the Company. The outplacement services to be provided to Executive shall be no
less favorable to Executive than those made available to other executives prior
to the date hereof under the Company's generally applicable policies, programs
or arrangements.

            7. Change in Control of the Company.

            a. Accelerated Vesting and Payment. Unless the Board (or the
appropriate committee thereof) shall otherwise determine in the manner set forth
in Paragraph 7(b), the Option shall become fully exercisable upon the occurrence
of a Change in Control (as defined below) and shall remain exercisable for a
period of one year thereafter regardless of whether Executive continues to be
employed by the Company or, if longer, for the period during which such Option
would otherwise be exercisable in accordance with its terms or the generally
applicable provisions of the 1994 Plan. If no Alternative Option is provided as
set forth in Section 7(b) below, and the Company does not survive as a publicly
traded corporation following a Change in Control, the Company shall pay
Executive, in full settlement of all rights with respect to the Option, an
aggregate amount in cash equal to the product of (i) (A) the Fair Market Value
of a Share of the Company's Common Stock on the date the Change in Control
occurs minus (B) the per share exercise price for the Option times (ii) the
number of shares as to which such Option has not been exercised at the time of
the Change in Control. Any amount payable pursuant to the preceding sentence
shall be paid within 30 days following such Change in Control.

            b. Alternative Options. Notwithstanding Paragraph 7(a), no
acceleration of exercisability shall occur with respect to any Option if the
Board (or the appropriate committee thereof) reasonably determines in good
faith, prior to the occurrence of a Change in Control, that such Option shall be
honored or assumed, or new rights substituted therefor (such honored,


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assumed or substituted Option being hereinafter referred to as an "Alternative
Option") by the successor in interest to the Company, provided that any such
Alternative Option must:

      (i)   provide Executive with rights and entitlements substantially
            equivalent to or better than the rights, terms and conditions
            applicable under the Option, including, but not limited to, an
            identical or better exercise and vesting schedule and identical or
            better timing and methods of payment;

      (ii)  have substantially equivalent economic value to such Option
            (determined at the time of the Change in Control); and

      (iii) have terms and conditions which provide that, in the event that
            Executive's employment is terminated by the Company for any reason
            or is terminated by Executive pursuant to a Termination for Good
            Reason within two years following a Change in Control, (A) any
            conditions on Executive's rights under, or any restrictions on
            exercisability applicable to, each such Alternative Option shall be
            waived or shall lapse, as the case may be and (B) the Alternative
            Option shall remain exercisable until the second anniversary of the
            Change in Control or, if longer, for the period during which such
            Alternative Option would otherwise be exercisable in accordance with
            its terms or the provisions of the plan under which it is granted
            that permit the longest post-termination exercise period for
            involuntary terminations (other than due to death, disability or
            retirement).

            c. Enhanced Severance Payments. If Executive's employment is
terminated following a Change in Control pursuant to a Termination for Good
Reason or a Termination Without Cause, the Severance Benefit payable to
Executive pursuant to Paragraph 6 shall be equal to two times the sum of
Executive's annual Base Salary and the Bonus Severance Amount.

            d. Additional Payments by the Company.

      (i)   Application of Paragraph 7(d). In the event that any amount or
            benefit paid or distributed to Executive pursuant to this
            Agreement, taken together with any amounts or benefits otherwise
            paid or distributed to Executive by the Company or any affiliated
            company (collectively, the "Covered Payments"), would be an
            "excess parachute payment" as defined in Section 280G of the Code
            and would thereby subject Executive to the tax (the "Excise Tax")
            imposed under Section 4999 of the Code (or any similar tax that
            may hereafter be imposed), the provisions of this Section 7(d)
            shall apply to determine the amounts payable to Executive
            pursuant to this Agreement.

      (ii)  Calculation of Benefits. Immediately following delivery of any
            Notice of Termination, the Company shall notify Executive of the
            aggregate present value of all termination benefits to which he
            would be entitled under this Agreement and any other plan,
            program or arrangement as of the projected date of termination,
            together with the projected maximum payments, determined as of


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            such projected date of termination that could be paid without
            Executive being subject to the Excise Tax.

      (iii) Imposition of Payment Cap. If the aggregate value of all
            compensation payments or benefits to be paid or provided to
            Executive under this Agreement and any other plan, agreement or
            arrangement with the Company exceeds the amount which can be paid to
            Executive without Executive incurring an Excise Tax by less than
            105%, then the amounts payable to Executive under this Agreement
            may, in the discretion of the Company, be reduced (but not below
            zero) to the maximum amount which may be paid hereunder without
            Executive becoming subject to such an Excise Tax (such reduced
            payments to be referred to as the "Payment Cap"). In the event that
            Executive receives reduced payments and benefits hereunder,
            Executive shall have the right to designate which of the payments
            and benefits otherwise provided for in this Agreement that he will
            receive in connection with the application of the Payment Cap.

      (iv)  Further Payments by the Company. If the aggregate value of all
            compensation payments or benefits to be paid or provided to
            Executive under this Agreement and any other plan, agreement or
            arrangement with the Company exceeds the amount which can be paid to
            Executive without Executive incurring an Excise Tax by more than
            105%, the Company shall pay to Executive immediately following
            Executive's termination of employment an additional amount (the "Tax
            Reimbursement Payment") such that the net amount retained by
            Executive with respect to such Covered Payments, after deduction of
            any Excise Tax on the Covered Payments and any Federal, state and
            local income tax and Excise Tax on the Tax Reimbursement Payment
            provided for by this Paragraph 7(d)(iv), but before deduction for
            any Federal, state or local income or employment tax withholding on
            such Covered Payments, shall be equal to the amount of the Covered
            Payments.

      (v)   Application of Section 280G. For purposes of determining whether any
            of the Covered Payments will be subject to the Excise Tax and the
            amount of such Excise Tax,

            (A)   such Covered Payments will be treated as "parachute
                  payments" within the meaning of Section 280G of the Code,
                  and all "parachute payments" in excess of the "base amount"
                  (as defined under Section 280G(b)(3) of the Code) shall be
                  treated as subject to the Excise Tax, unless, and except to
                  the extent that, in the good faith judgment of the
                  Company's independent certified public accountants
                  appointed prior to the Effective Date or tax counsel
                  selected by such Accountants (the "Accountants"), the
                  Company has a reasonable basis to conclude that such
                  Covered Payments (in whole or in part) either do not
                  constitute "parachute payments" or represent reasonable
                  compensation for personal services actually rendered
                  (within the meaning of Section 280G(b)(4)(B) of the Code)
                  in excess of the "base 


                                       11
<PAGE>   12

                  amount," or such "parachute payments" are otherwise not
                  subject to such Excise Tax, and

            (B)   the value of any non-cash benefits or any deferred payment or
                  benefit shall be determined by the Accountants in accordance
                  with the principles of Section 280G of the Code.

      (vi)  Applicable Tax Rates. For purposes of determining whether Executive
            would receive a greater net after-tax benefit were the amounts
            payable under this Agreement reduced in accordance with Paragraph
            7(d)(iii), Executive shall be deemed to pay:

            (A)   Federal income taxes at the highest applicable marginal rate
                  of Federal income taxation for the calendar year in which the
                  first amounts are to be paid hereunder, and

            (B)   any applicable state and local income taxes at the highest
                  applicable marginal rate of taxation for such calendar year,
                  net of the maximum reduction in Federal incomes taxes which
                  could be obtained from the deduction of such state or local
                  taxes if paid in such year;

            provided, however, that Executive may request that such
            determination be made based on his individual tax circumstances,
            which shall govern such determination so long as Executive provides
            to the Accountants such information and documents as the Accountants
            shall reasonably request to determine such individual circumstances.

      (vii) Adjustments in Respect of the Payment Cap. If Executive receives
            reduced payments and benefits under this Paragraph 7(d) (or this
            Paragraph 7(d) is determined not to be applicable to Executive
            because the Accountants conclude that Executive is not subject to
            any Excise Tax) and it is established pursuant to a final
            determination of a court or an Internal Revenue Service proceeding
            (a "Final Determination") that, notwithstanding the good faith of
            Executive and the Company in applying the terms of this Agreement,
            the aggregate "parachute payments" within the meaning of Section
            280G of the Code paid to Executive or for his benefit are in an
            amount that would result in Executive being subject an Excise Tax,
            then the amount equal to such excess parachute payments shall be
            deemed for all purposes to be a loan to Executive made on the date
            of receipt of such excess payments, which Executive shall have an
            obligation to repay to the Company on demand, together with interest
            on such amount at the applicable Federal rate (as defined in Section
            1274(d) of the Code) from the date of the payment hereunder to the
            date of repayment by Executive. If this Paragraph 7(d) is not
            applied to reduce Executive's entitlements under this Paragraph 7
            because the Accountants determine that Executive would not receive a
            greater net-after tax benefit by applying this Paragraph 7(d) and it
            is established pursuant to a Final 


                                       12
<PAGE>   13

            Determination that, notwithstanding the good faith of Executive and
            the Company in applying the terms of this Agreement, Executive would
            have received a greater net after tax benefit by subjecting his
            payments and benefits hereunder to the Payment Cap, then the
            aggregate "parachute payments" paid to Executive or for his benefit
            in excess of the Payment Cap shall be deemed for all purposes a loan
            to Executive made on the date of receipt of such excess payments,
            which Executive shall have an obligation to repay to the Company on
            demand, together with interest on such amount at the applicable
            Federal rate (as defined in Section 1274(d) of the Code) from the
            date of the payment hereunder to the date of repayment by Executive.
            If Executive receives reduced payments and benefits by reason of
            this Paragraph 7(d) and it is established pursuant to a Final
            Determination that Executive could have received a greater amount
            without exceeding the Payment Cap, then the Company shall promptly
            thereafter pay Executive the aggregate additional amount which could
            have been paid without exceeding the Payment Cap, together with
            interest on such amount at the applicable Federal rate (as defined
            in Section 1274(d) of the Code) from the original payment due date
            to the date of actual payment by the Company.

     (viii) Adjustments in Respect of the Tax Reimbursement Payments. In the
            event that the Excise Tax is subsequently determined by the
            Accountants or pursuant to any proceeding or negotiations with the
            Internal Revenue Service to be less than the amount taken into
            account hereunder in calculating the Tax Reimbursement Payment made,
            Executive shall repay to the Company, at the time that the amount of
            such reduction in the Excise Tax is finally determined, the portion
            of such prior Tax Reimbursement Payment that would not have been
            paid if such Excise Tax had been applied in initially calculating
            such Tax Reimbursement Payment, plus interest on the amount of such
            repayment at the rate provided in Section 1274(b)(2)(B) of the Code.
            Notwithstanding the foregoing, in the event any portion of the Tax
            Reimbursement Payment to be refunded to the Company has been paid to
            any Federal, state or local tax authority, repayment thereof shall
            not be required until actual refund or credit of such portion has
            been made to Executive, and interest payable to the Company shall
            not exceed interest received or credited to Executive by such tax
            authority for the period it held such portion. Executive and the
            Company shall mutually agree upon the course of action to be pursued
            (and the method of allocating the expenses thereof) if Executive's
            good faith claim for refund or credit is denied.

            In the event that the Excise Tax is later determined by the
            Accountants or pursuant to any proceeding or negotiations with the
            Internal Revenue Service to exceed the amount taken into account
            hereunder at the time the Tax Reimbursement Payment is made
            (including, but not limited to, by reason of any payment the
            existence or amount of which cannot be determined at the time of the
            Tax Reimbursement Payment), the Company shall make an additional Tax
            Reimbursement Payment in respect of such excess (plus any interest
            or penalty 


                                       13
<PAGE>   14

            payable with respect to such excess) at the time that the amount of
            such excess is finally determined.

      (ix)  Timing of Payment. Any Tax Reimbursement Payment (or portion
            thereof) provided for in Paragraph 7(d)(iv) above shall be paid
            to Executive not later than 10 business days following the
            payment of the Covered Payments; provided, however, that if the
            amount of such Tax Reimbursement Payment (or portion thereof)
            cannot be finally determined on or before the date on which
            payment is due, the Company shall pay to Executive by such date
            an amount estimated in good faith by the Accountants to be the
            minimum amount of such Tax Reimbursement Payment and shall pay
            the remainder of such Tax Reimbursement Payment (together with
            interest at the rate provided in Section 1274(b)(2)(B) of the
            Code) as soon as the amount thereof can be determined, but in no
            event later than 45 calendar days after payment of the related
            Covered Payment.  In the event that the amount of the estimated
            Tax Reimbursement Payment exceeds the amount subsequently
            determined to have been due, such excess shall constitute a loan
            by the Company to Executive, payable on the fifth business day
            after written demand by the Company for payment (together with
            interest at the rate provided in Section 1274(b)(2)(B) of the
            Code).

            e. Definition of "Change in Control". For purposes of this Paragraph
7, a "Change in Control" means the happening of any of the following:

            (i) When any "person" as defined in Section 3(a)(9) of the
      Securities Exchange Act of 1934, as amended (the "Exchange Act") and as
      used in Sections 13(d) and 14(d) thereof, including a "group" as defined
      in Section 13(d) of the Exchange Act but excluding the Company and any
      subsidiary thereof and any employee benefit plan sponsored or maintained
      by the Company or any Subsidiary (including any trustee of such plan
      acting as trustee), directly or indirectly, becomes the "beneficial owner"
      (as defined in Rule 13d-3 under the Exchange Act, as amended from time to
      time), of securities of the Company representing 20 percent or more of the
      combined voting power of the Company's then outstanding securities;

            (ii) When, during any period of 24 consecutive months after the
      Commencement Date, the individuals who, at the beginning of such period,
      constitute the Board (the "Incumbent Directors") cease for any reason
      other than death to constitute at least a majority thereof, provided that
      a director who was not a director at the beginning of such 24-month period
      shall be deemed to have satisfied such 24-month requirement (and be an
      Incumbent Director) if such director was elected by, or on the
      recommendation of or with the approval of, at least two-thirds of the
      directors who then qualified as Incumbent Directors either actually
      (because they were directors at the beginning of such 24-month period) or
      by prior operation of this Paragraph 7(e)(ii); or


                                       14
<PAGE>   15

            (iii) The occurrence of a transaction requiring stockholder approval
      for the acquisition of the Company by an entity other than the Company or
      a subsidiary through purchase of assets, or by merger, or otherwise.

            8. Noncompetition and Confidentiality.

            a. Noncompetition. During the Contract Employment Period and for a
period of one year following Executive's termination of employment during the
Contract Employment Period other than due to a Termination Without Cause or a
Termination for Good Reason, Executive shall not become associated, whether as a
principal, partner, employee, consultant or shareholder (other than as a holder
of not in excess of 1% of the outstanding voting shares of any publicly traded
company), with any entity that is actively engaged in any geographic area in any
business which is in substantial and direct competition with the business or
businesses of the Company for which Executive provides substantial services or
for which Executive has substantial responsibility, provided that nothing in
this Paragraph 8(a) shall preclude Executive from performing services solely and
exclusively for a division or subsidiary of such an entity that is engaged in a
non-competitive business.

            b. Nondisclosure, Nonsolicitation and Cooperation.

            (i) Executive shall not (except to the extent required by an order
      of a court having competent jurisdiction or under subpoena from an
      appropriate government agency) disclose to any third person, whether
      during or subsequent to the Executive's employment with the Company, any
      trade secrets; customer lists; product development and related
      information; marketing plans and related information; sales plans and
      related information; operating policies and manuals; business plans;
      financial records; or other financial, commercial, business or technical
      information related to the Company or any subsidiary or affiliate thereof
      unless such information has been previously disclosed to the public by the
      Company or has become public knowledge other than by a breach of this
      Agreement; provided, however, that this limitation shall not apply to any
      such disclosure made while Executive is employed by the Company, or any
      subsidiary or affiliate thereof in the ordinary course of the performance
      of Executive's duties;

            (ii) during the Contract Employment Period and for two years after
      the termination of such Period, Executive shall not attempt, directly or
      indirectly, to induce any employee or Insurance Agent (as defined below)
      of the Company, or any subsidiary or any affiliate thereof to be employed
      or perform services elsewhere provided that this covenant shall not
      preclude Executive from taking any actions during the Contract Employment
      Period that (x) are intended to benefit the Company or any subsidiary or
      affiliate and (y) do not benefit Executive financially other than as an
      employee or stockholder of the Company;

            (iii) during the Contract Employment Period and for two years after
      the termination of such Period, Executive shall not attempt, directly or
      indirectly, to induce any insurance agent or agency, insurance broker,
      broker-dealer or supplier of the 


                                       15
<PAGE>   16

      Company, or any subsidiary or affiliate thereof to cease providing
      services to the Company, or any subsidiary or affiliate thereof provided
      that this covenant shall not preclude Executive from taking any actions
      during the Contract Employment Period that (x) are intended to benefit the
      Company or any subsidiary or affiliate and (y) do not benefit Executive
      financially other than as an employee or stockholder of the Company;

            (iv) during the Contract Employment Period and for two years after
      the termination of such Period, Executive shall not attempt, directly or
      indirectly, to solicit, on behalf of any person or entity other than the
      Company or any of its subsidiaries, the trade of any individual or entity
      which, at the time of the solicitation, is a customer of the Company, or
      any subsidiary or affiliate thereof, or which the Company, or any
      subsidiary or affiliate thereof is undertaking reasonable steps to procure
      as a customer at the time of or immediately preceding termination of the
      Contract Employment Period; provided, however, that this limitation shall
      only apply to (x) any product or service which is in competition with a
      product or service of the Company or any subsidiary or affiliate thereof
      and (y) with respect to any customer or prospective customer with whom
      Executive has or had (by virtue of Executive's position or otherwise) a
      personal relationship; and

            (v) following the termination of the Contract Employment Period,
      Executive shall provide assistance to and shall cooperate with the Company
      or any subsidiary or affiliate thereof, upon its reasonable request, with
      respect to matters within the scope of Executive's duties and
      responsibilities during the Contract Employment Period. (The Company
      agrees and acknowledges that it shall, to the maximum extent possible
      under the then prevailing circumstances, coordinate (or cause a subsidiary
      or affiliate thereof to coordinate) any such request with Executive's
      other commitments and responsibilities to minimize the degree to which
      such request interferes with such commitments and responsibilities). The
      Company agrees that it will reimburse Executive for reasonable travel
      expenses (i.e., travel, meals and lodging) that Executive may incur in
      providing assistance to the Company hereunder.

Solely for purposes of Paragraph 8(b)(ii) above, the term "Insurance Agent"
shall mean those insurance agents or agencies representing the Company or any
subsidiary or affiliate thereof, that are exclusive or career agents or agencies
of the Company or any subsidiary or affiliate thereof, or any insurance agents
or agencies which derive 50% or more of their business revenue from the Company
or any subsidiary or affiliate thereof (calculated on an aggregate basis for the
12-month period prior to the date of determination or such other similar period
for which such information is more readily available).

            c. Company Property. Promptly following Executive's termination of
employment, Executive shall return to the Company all property of the Company,
and all copies thereof in Executive's possession or under his control.

            d. Intention of the Parties. If any provision of Paragraph 8 is
determined by an arbitrator (or a court of competent jurisdiction asked to
enforce the decision of the arbitrator) 


                                       16
<PAGE>   17

not to be enforceable in the manner set forth in this Agreement, the Company and
Executive agree that it is the intention of the parties that such provision
should be enforceable to the maximum extent possible under applicable law and
that such arbitrator (or court) shall reform such provision to make it
enforceable in accordance with the intent of the parties. Executive acknowledges
that a material part of the inducement for the Company to provide the salary and
benefits evidenced hereby is Executive's covenants set forth in Paragraph 8(a),
(b) and (c) and that the covenants and obligations of Executive with respect to
nondisclosure and nonsolicitation relate to special, unique and extraordinary
matters and that a violation of any of the terms of such covenants and
obligations will cause the Company irreparable injury for which adequate
remedies are not available at law. Therefore, Executive agrees that, if
Executive shall materially breach any of those covenants following termination
of employment, the Company shall have no further obligation to pay Executive any
benefits otherwise payable hereunder and the Company shall be entitled to an
injunction, restraining order or such other equitable relief (without the
requirement to post a bond) restraining Executive from committing any violation
of the covenants and obligations contained in Paragraph 8(a), (b) and (c). The
remedies in the preceding sentence are cumulative and are in addition to any
other rights and remedies the Company may have at law or in equity as an
arbitrator (or court) shall reasonably determine.

            e. Waiver. Without limiting the generality of the foregoing, upon
request of Executive prior to engaging in any conduct otherwise prohibited by
this Paragraph 8, the Company may, in its sole discretion, waive in writing, on
such terms and conditions as it may deem appropriate, any violation of this
Paragraph 8 which would otherwise occur due to such conduct.

            9. Miscellaneous.

            a. Survival. Paragraphs 5(c) (dealing with reimbursement of
expenses), 7 (relating to a Change in Control), 8 (relating to noncompetition,
nonsolicitation and confidentiality) and 9 (relating, among other things, to
survival, assignment and governing law) shall survive the termination hereof,
whether such termination shall be by expiration of the Contract Employment
Period or an early termination pursuant to Paragraph 6 hereof. Paragraph 6
(relating to early termination) shall survive the termination hereof to the
extent that, prior thereto, or at the time of termination, Executive (or his
beneficiary) has become or becomes entitled to receive any of the benefits
payable thereunder. The option referred to in Paragraph 4 survives for the term
specified in Attachment A.

            b. Binding Effect. This Agreement shall be binding on, and shall
inure to the benefit of, the Company and any person or entity that succeeds to
the interest of the Company (regardless of whether such succession does or does
not occur by operation of law) by reason of the sale of all or a portion of the
Company's stock, a merger, consolidation or reorganization involving the Company
or, unless in the case of a sale involving less than all or substantially all of
the Company's assets the Company otherwise elects in writing, a sale of the
assets of the business of the Company (or portion thereof) in which Executive
performs a majority of his services. Any successor in interest to the Company
shall acknowledge in writing to Executive that it has assumed this Agreement and
is responsible to Executive for the performance of the


                                       17
<PAGE>   18

Company's obligations under this Agreement. Without limiting the generality of
the foregoing, the Company shall have the right, without the consent of
Executive, to assign this Agreement and its obligations hereunder to any New
Entity or any subsidiary of any New Entity by which Executive becomes employed,
at the discretion of the Company, by reason of the implementation of any
restructuring of the Company, and, following any such assignment, such New
Entity or subsidiary shall be treated as the Company for all purposes of this
Agreement. This Agreement shall also enure to the benefit of Executive's heirs,
executors, administrators and legal representatives.

            c. Assignment. Except as provided under Paragraph 9(b), neither this
Agreement nor any of the rights or obligations hereunder shall be assigned or
delegated by any party hereto without the prior written consent of the other
party. In the event the Company assigns this Agreement pursuant to Section 9(b),
the Company shall guarantee payment to Executive of any amounts at any time due
and payable hereunder in the event (and only to the extent) that the assignee
has become a debtor in bankruptcy, is the subject of a receivership or similar
preceding or has become insolvent, provided that Executive shall be required to
assign his rights against the assignee through subrogation as a condition of
receiving any payment under the Company's guarantee. In consideration of such
guarantee, Executive agrees that following such assignment, the covenants of
Executive in Paragraphs 8(b)(i) and (v) shall continue to inure to the benefit
of the Company, as well as the assignee. The Company and Executive agree that
following any assignment all other covenants described herein in favor of the
Company shall, from and after the date of such assignment, inure solely to the
benefit of the assignee.

            d. Entire Agreement. Except as expressly provided below, this
Agreement, the Option Agreement and the portion, if any, of any other agreement
relating to pension service or credits referred to in Paragraph 5(a) shall
constitute the entire agreement between the parties hereto with respect to the
matters referred to herein and any other agreement or any portion of any such
other agreement not expressly preserved hereby shall cease to be effective upon
the execution hereof and shall not become reinstated upon the expiration or
other termination of this Agreement. There are no promises, representations,
inducements or statements between the parties other than those that are
expressly contained herein. Executive acknowledges that he is entering into this
Agreement of his own free will and accord, and with no duress, that he has read
this Agreement and that he understands it and its legal consequences. Other than
the provisions of Paragraph 6 which limit Executive's eligibility to receive
severance benefits under the Company's generally applicable plans, programs or
agreements, nothing in this Agreement shall be construed to limit or otherwise
supersede Executive's rights or entitlements under any compensatory plan,
program or arrangement made available generally to all employees or all officers
of the Company or under the 1994 Plan or the 1984 Plan and this Paragraph 9(d)
shall not preclude reference to the documents governing any such plan, program
or arrangement to determine such rights and entitlements.

            e. Severability; Reformation. In the event that one or more of the
provisions of this Agreement shall become invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not be affected thereby. In the event any of
Paragraph 8(a), (b) or (c) is not enforceable in accordance with its 


                                       18
<PAGE>   19

terms, Executive and the Company agree that such Paragraph shall be reformed to
make such Paragraph enforceable in a manner which provides the Company the
maximum rights permitted at law.

            f. Waiver. Waiver by any party hereto of any breach or default by
the other party of any of the terms of this Agreement shall not operate as a
waiver of any other breach or default, whether similar to or different from the
breach or default waived. No waiver of any provision of this Agreement shall be
implied from any course of dealing between the parties hereto or from any
failure by either party hereto to assert its or his rights hereunder on any
occasion or series of occasions.

            g. Notices. Any notice required or desired to be delivered under
this Agreement shall be in writing and shall be delivered personally, by courier
service, by registered mail, return receipt requested, or by telecopy and shall
be effective upon actual receipt by the party to which such notice shall be
directed, and shall be addressed as follows (or to such other address as the
party entitled to notice shall hereafter designate in accordance with the terms
hereof):

            If to the Company:

                  Aetna Life and Casualty Company
                  151 Farmington Avenue
                  Hartford, Connecticut
                  Attention: Corporate Secretary


                                       19
<PAGE>   20

            If to Executive:

                  Fredrick C. Copeland, Jr.
                  75 Bloomfield Avenue
                  West Hartford, Connecticut  06015

            h. Arbitration. The Company and Executive agree that any claim,
dispute or controversy arising under or in connection with this Agreement, or
otherwise in connection with Executive's employment by the Company (including,
without limitation, any such claim, dispute or controversy arising under any
federal, state or local statute, regulation or ordinance or any of the Company's
employee benefit plans, policies or programs) shall be resolved solely and
exclusively by binding arbitration. The arbitration shall be held in the city of
Hartford, Connecticut (or at such other location as shall be mutually agreed by
the parties). The arbitration shall be conducted in accordance with the
Expedited Employment Arbitration Rules (the "Rules") of the American Arbitration
Association (the "AAA") in effect at the time of the arbitration, except that
the arbitrator shall be selected by alternatively striking from a list of five
arbitrators supplied by the AAA. All fees and expenses of the arbitration,
including a transcript if either requests, shall be borne equally by the
parties. If Executive prevails as to any material issue presented to the
arbitrator, the entire cost of such proceedings (including, without limitation,
Executive's reasonable attorneys fees) shall be borne by the Company. If
Executive does not prevail as to any material issue, each party will pay for the
fees and expenses of its own attorneys, experts, witnesses, and preparation and
presentation of proofs and post-hearing briefs (unless the party prevails on a
claim for which attorney's fees are recoverable under the Rules). Any action to
enforce or vacate the arbitrator's award shall be governed by the Federal
Arbitration Act, if applicable, and otherwise by applicable state law. If either
the Company or Executive pursues any claim, dispute or controversy against the
other in a proceeding other than the arbitration provided for herein, the
responding party shall be entitled to dismissal or injunctive relief regarding
such action and recovery of all costs, losses and attorney's fees related to
such action.

            i. Amendments. This Agreement may not be altered, modified or
amended except by a written instrument signed by each of the parties hereto.

            j. Headings. Headings to paragraphs in this Agreement are for the
convenience of the parties only and are not intended to be part of or to affect
the meaning or interpretation hereof.

            k. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which together shall
constitute one and the same instrument.

            l. Withholding. Any payments provided for herein shall be reduced by
any amounts required to be withheld by the Company from time to time under
applicable Federal, State or local income or employment tax laws or 
similar statutes or other provisions of law then in effect.


                                       20
<PAGE>   21

            m. Governing Law. This Agreement shall be governed by the laws of
the State of Connecticut, without reference to principles of conflicts or choice
of law under which the law of any other jurisdiction would apply.

            IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer and Executive has hereunto set his hand
as of the day and year first above written.

                                    Aetna Life and Casualty Company

                                    /s/ Ronald E. Compton
                                    ---------------------
                                    Ronald E. Compton
                                    Chairman


                                    /s/ Fredrick C. Copeland, Jr.
                                    -----------------------------
                                    Fredrick C. Copeland, Jr.


                                       21
<PAGE>   22

                                               EXHIBIT A TO EMPLOYMENT AGREEMENT


                         AETNA LIFE AND CASUALTY COMPANY
                            1994 STOCK INCENTIVE PLAN


            PERFORMANCE VESTED NONSTATUTORY STOCK OPTION AGREEMENT

Pursuant to its 1994 Stock Incentive Plan, Aetna Life and Casualty Company
hereby grants to the person named below the right and option to purchase the
stated number of shares of Common Stock on the terms and conditions hereinafter
set forth.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
Effective Date    Aetna No.    Grantee     Total Optioned Shares    Option Price
<S>               <C>          <C>         <C>                      <C>

--------------------------------------------------------------------------------
</TABLE>

                                    ARTICLE I

                                   DEFINITIONS

(a)   "Board" means the Board of Directors of Aetna Life and Casualty Company.

(b)   "Committee" means the Board's Committee on Compensation and Organization
      or any successor thereto.

(c)   "Common Stock" means shares of the Company's Common Capital Stock, without
      par value.

(d)   "Company" means Aetna Life and Casualty Company.

(e)   "Disability" means long-term disability as defined under the terms of the
      Company's applicable long-term disability plans or policies.

(f)   "Effective Date" means the date of grant of this Option, as set forth
      above.

(g)   "Fair Market Value" means the closing price of the Common Stock as
      reported by the Consolidated Tape of the New York Stock Exchange Listed
      Shares on the date such value is to be determined, or, if no shares were
      traded on such day, on the next preceding day on which the Common Stock
      was traded.

(h)   "For Cause" means a termination of Grantee's employment by the Company due
      to (i) the willful failure by Grantee to perform substantially Grantee's
      duties as an employee of the Company (other than due to physical or mental
      illness) after reasonable notice to Grantee of such failure, (ii)
      Grantee's engaging in serious misconduct that is injurious to the Company
      or any subsidiary or any affiliate of the Company, (iii) Grantee's having
      been convicted of, or entered a plea of nolo


                                       22
<PAGE>   23

      contendere to, a crime involving an act that is immoral or wrong in and of
      itself (e.g., burglary, larceny, murder or arson) or a crime involving
      deceit, fraud, perjury or embezzlement, (iv) the breach by Grantee of any
      written covenant or agreement not to compete with the Company or any
      subsidiary or any affiliate or (v) the breach by Grantee of his duty of
      loyalty to the Company which shall include, without limitation, (A) the
      disclosure by Grantee of any confidential information pertaining to the
      Company or any Subsidiary or any affiliate of the Company, other than (x)
      in the ordinary course of the performance of his duties on behalf of the
      Company or (y) pursuant to a judicial or administrative subpoena from a
      court or governmental authority with jurisdiction over the matter in
      question, (B) the harmful interference by Grantee in the business or
      operations of the Company or any Subsidiary or any affiliate of the
      Company, (C) any attempt by Grantee directly or indirectly to induce any
      employee, insurance agent, insurance broker or broker-dealer of the
      Company or any Subsidiary or any affiliate to be employed or perform
      services elsewhere, (D) any attempt by Grantee directly or indirectly to
      solicit the trade of any customer or supplier, or prospective customer or
      supplier, of the Company on behalf of any person other than the Company or
      a Subsidiary thereof or (E) any breach or violation of the Company's Code
      of Conduct, as amended from time to time. Notwithstanding the foregoing, a
      breach of Grantee's duty of loyalty to the Company as described in
      subclause (A) or (E) of clause (v) of the preceding sentence shall not be
      grounds for a termination For Cause unless such breach has had or could
      reasonably be expected to have a significant adverse effect on the
      business or reputation of the Company.

(i)   "Fundamental Corporate Event" shall mean any stock dividend, extraordinary
      cash dividend, recapitalization, reorganization, merger, consolidation,
      split-up, spin-off, combination, exchange of shares, warrants or rights
      offering to purchase Common Stock at a price substantially below fair
      market value, or similar event.

(j)  "Good Reason" means a termination of Grantee's employment by Grantee
     within 90 days following (i) a reduction in Grantee's annual Base Salary
     or incentive compensation opportunity as provided under Paragraph 3(b)
     of the employment agreement signed by Grantee and the Company dated as
     of December 8, 1995 (the "Employment Agreement"), (ii) a material
     reduction in Grantee's positions, duties and responsibilities from those
     described in Paragraph 2 of the Employment Agreement, (iii) the
     relocation of Grantee's principal place of employment to a location more
     than 50 miles from the location at which he performed his principal
     duties on the date immediately prior to such relocation, (iv) a breach
     of the obligation to provide Grantee with the benefits required to be
     provided in accordance with Paragraph 5(a) of the Employment Agreement,
     (v) a failure by the Company to pay any amounts due and owing to Grantee
     within 10 days following written notice from Grantee of such failure to
     pay, or (vi) any other material breach of the Company's obligations to
     Grantee under the Employment Agreement that significantly affects the
     compensation or benefits payable to Grantee or materially impairs
     Grantee's ability to perform the duties and responsibilities of his
     position.  Notwithstanding the foregoing, a termination shall not be
     treated as a termination for Good Reason (i) if Grantee shall


                                       23
<PAGE>   24

      have consented in writing to the occurrence of the event giving rise to
      the claim of termination for Good Reason or (ii) unless Grantee shall have
      delivered a written notice to the Chief Executive Officer of the Company
      within 60 days of his having actual knowledge of the occurrence of one or
      such events stating that he intends to terminate his employment for Good
      Reason and specifying the factual basis for such termination, and such
      event shall not have been cured within 30 days of the receipt of such
      notice.

(k)   "Grantee" means the person named above to whom this Option has been
      granted.

(l)   "Interim Performance Period" means the period of time beginning on the
      Effective Date and ending on April 28, 1997.

(m)   "Option" means the option herein granted.

(n)   "Option Price" means the amount per share of Common Stock required to be
      paid upon the exercise of this Option, as set forth above, or such other
      amount per share of Common Stock as may result by operations of Article IV
      of this Agreement.

(o)   "Optioned Shares" means the number of shares of Common Stock represented
      by this Option, as set forth above, or such other amount as may result by
      operation of Article IV of this Agreement.

(p)   "Performance Target" means the performance objective measured by the price
      of the Common Stock as described in Article II.

(q)   "Performance Period" means the period of time beginning on the Effective
      Date and ending on April 28, 1998.

(r)   "Plan" means the Aetna Life and Casualty Company 1994 Stock Incentive
      Plan.

(s)   "Retirement" means the termination of employment of a Grantee from active
      service with the Company or a Subsidiary under circumstances which would
      entitle an employee of the Company or a Subsidiary to an immediate pension
      under one of the Company's approved retirement plans (such pension may be
      actuarially reduced for early commencement of benefits).

(t)   "Shares of Stock" or "Stock" means the Common Stock.

(u)   "Subsidiary" means any entity of which, at the time such subsidiary status
      is to be determined, at least 50% of the total combined voting power of
      all classes of stock in such entity is held by the Company and its
      Subsidiaries (exclusive of ownership by the entity whose subsidiary status
      is being determined).


                                       24
<PAGE>   25

(v)   "Successor" means the legal representative of the estate of a deceased
      Grantee or the person or persons who shall acquire the right to exercise
      an Option by bequest or inheritance or by reason of the death of the
      Grantee.


                                       25
<PAGE>   26

                                   ARTICLE II

                           TERM OF OPTION AND VESTING

(a)   The Term of this Option shall commence on the Effective Date and shall
      terminate, unless sooner terminated by the terms of the Plan or this
      Agreement, at:

      (i)   the close of the Company's business on the day preceding the tenth
            anniversary of the Effective Date, if the Company is open for
            business on such day: or

      (ii)  the close of the Company's business on the next preceding day that
            the Company is open for business.

(b)   Except as provided in (c), (d) and (e) below, all or a portion of this
      Option will become vested and the Option will be exercisable on April 28,
      1998 only to the extent the Fair Market Value of the Common Stock meets or
      exceeds the Performance Targets described below. A Performance Target
      shall be deemed to have been met only to the extent the Fair Market Value
      of the Common Stock meets or exceeds the Performance Target for at least
      five consecutive trading business days at any time during the Performance
      Period.

<TABLE>
<CAPTION>
               ---------------------------------------------
                  Performance Target       Amount Vested
               ---------------------------------------------
                    <S>                 <C> 
                    Below $78           Option does not vest
                    $78                          33% 
                    $84                          67% 
                    $91 or above                100% 
               ---------------------------------------------
</TABLE>

      The portion of the Option which shall vest at performance levels between
      $62 and $73 shall be determined by mathematical interpolation between the
      respective measuring points. Notwithstanding anything else contained
      herein to the contrary, the portion of the Option which shall become
      vested under Section (b), if any, shall be reduced by the amount which has
      become vested pursuant to (c) below.

(c)   If the Performance Targets described above are met or exceeded during the
      Interim Performance Period, 50% of the amount which would have become
      vested in accordance with the above schedule will become vested on April
      28, 1997.

(d)   This Option may become vested pursuant to (b) and (c) above only if the
      Grantee is an active employee of the Company or a Subsidiary as of the
      last day of the Performance Period or the Interim Performance Period, as
      the case may be; provided, however, if the Company involuntarily
      terminates the employment of the Grantee (other than "For Cause"), the
      Grantee dies or terminates employment for reason of Disability, or if the
      Grantee voluntarily terminates employment for "Good Reason," the Option
      may continue to vest for such Grantee if the Performance Targets are met
      during the Performance Period or Interim Performance Period.


                                       26
<PAGE>   27

(e)   If the Performance Targets are not met as of the end of the Performance
      Period, the Options will become vested on April 28, 2002, provided the
      Grantee is an active employee of the Company or a Subsidiary on that date.

                                   ARTICLE III

                            METHOD OF OPTION EXERCISE

An option is exercisable only after it has become vested as provided in Article
II above. In order to exercise this Option, Grantee must comply with procedures
adopted by the Company from time to time. Under current procedures, the Grantee
must deliver or mail to the Committee, Attention: Manager, Grantee Compensation,
Aetna Human Resources, a properly executed exercise notification letter on the
appropriate form along with payment of the Option Price. If Grantee is using the
cashless exercise program offered by the Company, the exercise notice must be
delivered to the participating broker.

In addition, if the Grantee has been notified that he or she must consult with a
member of the Company's Law and Regulatory Affairs Department prior to engaging
in transactions in Aetna stock, Grantee must consult with the Law and Regulatory
Affairs prior to exercising this Option.

                                   ARTICLE IV

                                 CAPITAL CHANGES

Except as otherwise specifically provided in Article VI, in the event that the
Committee shall determine that any Fundamental Corporate Event affects the
Common Stock such that an adjustment is required to preserve, or to prevent
enlargement of, the benefits or potential benefits made available under this
Plan, then the Committee may, in such manner as the Committee may deem
equitable, adjust the (i) the number and kind of shares subject to the Option
(including substitution of shares or Options of another company), (ii) the
Performance Targets, or (iii) the Option Price. Additionally, the Committee may
make provision for a cash payment to a Grantee or the Successor of the Grantee.
However, the number of Shares of Stock subject to the Option shall always be a
whole number.

                                    ARTICLE V

                              TERMINATION OF OPTION

(a)   Except as provided in (d) below, if the Grantee shall cease, for reason of
      death, Disability or Retirement, to be employed by the Company or its
      Subsidiaries during the Term of the Option, the Grantee or Successor of
      the Grantee may exercise a vested Option until the earlier of:

      (i)   the expiration of the Term of the Option; or


                                       27
<PAGE>   28

      (ii)  a period not to exceed five years following such cessation of
            employment.

(b)   Except as provided in (a) above or (d) below, if the Grantee voluntarily
      ceases to be employed by the Company or its Subsidiaries (other than for
      "Good Reason") during the Term of the Option, the Grantee may exercise a
      vested Option until the earlier of:

      (i)   the expiration of the Term of the Option; or

      (ii)  a period not to exceed ninety days following such cessation of
            employment.

(c)   Except as provided in (a) above or (d) below, if the Grantee involuntarily
      ceases to be employed by the Company or its Subsidiaries other than for
      cause, or if Grantee voluntarily terminates employment for "Good Reason"
      during the Term of the Option, the Grantee may exercise a vested Option
      until the later of the expiration of four years from the Effective Date,
      or ninety days following such cessation of employment (but not following
      the expiration of the Term of the Option).

(d)   An Option that has not become vested as provided in Article II above at
      the time of cessation of employment (or after cessation of employment as
      provided in Article II(d)) may not be exercised thereafter. No Option may
      be exercised after the Company has terminated the employment of the
      Grantee For Cause, except that the Committee may, in its sole discretion,
      permit exercises for a period of up to ninety days in cases where the
      Committee shall determine such period is warranted under the particular
      circumstances.

(e)   If the Grantee has not entered into a written employment agreement
      satisfactory to the Company prior to February 16, 1996, this Option shall
      immediately terminate as of that date and shall have no further force or
      effect. In addition, if Grantee fails to comply with the term of any
      written employment agreement entered into with the Company, said failure
      shall cause this Option to immediately terminate, whether or not the
      Option has become vested.

(f)   Employment for purposes of determining eligibility for vesting
      post-employment exercise rights of the Grantee under this Agreement shall
      mean continuous full-time salaried employment with the Company or a
      Subsidiary and shall include periods during which the Grantee is on
      vacation, sick leave, or other approved absence, or in receipt of
      severance pay or other form of salary continuation benefit.

(g)   Except as otherwise herein provided, exercise of this Option, whether by
      the Grantee or the Successor of the Grantee, shall be subject to all terms
      and conditions of this Agreement.


                                       28
<PAGE>   29

                                    ATICLE VI

                                CHANGE-OF-CONTROL

(a)   For purposes of this Article VI, a "Change of Control" means the happening
      of any of the following:

      (i)   When any "person" as defined in Section 3(a)(9) of the Securities
            Exchange Act of 1934, as amended (the "Exchange Act") and as used in
            Sections 13(d) and 14(d) thereof, including a "group" as defined in
            Section 13(d) of the Exchange Act but excluding the Company and any
            subsidiary thereof and any employee benefit plan sponsored or
            maintained by the Company or any Subsidiary (including any trustee
            of such plan acting as trustee), directly or indirectly, becomes the
            "beneficial owner", (as defined in Rule 13d-3 under the Exchange
            Act, as amended from time to time), of securities of the Company
            representing 20 percent or more of the combined voting power of the
            Company's then outstanding securities;

      (ii)  When, during any period of 24 consecutive months after the
            Commencement Date, the individuals who, at the beginning of such
            period, constitute the Board (the "Incumbent Directors") cease for
            any reason other than death to constitute at least a majority
            thereof, provided that a director who was not a director at the
            beginning of such 24-month period shall be deemed to have satisfied
            such 24-month requirement (and be an Incumbent Director) if such
            director was elected by, or on the recommendation of or with the
            approval of, at least two-thirds of the directors who then qualified
            as Incumbent Directors either actually (because they were directors
            at the beginning of such 24-month period) or by prior operation of
            this Article VI(a)(ii); or

      (iii) The occurrence of a transaction requiring stockholder approval for
            the acquisition of the Company by an entity other than the Company
            or a subsidiary through purchase of assets, or by merger, or
            otherwise.

(b)   Unless the Board (or the Committee) shall otherwise determine in the
      manner set forth in Paragraph (c) below and notwithstanding anything in
      this Agreement to the contrary, this Option shall become fully exercisable
      upon the occurrence of a Change of Control (as defined in Paragraph (a)
      above) and shall remain exercisable for a period of at least one year
      thereafter regardless of whether Grantee continues to be employed by the
      Company or, if longer, for the period during which such Option would
      otherwise be exercisable in accordance with its terms.

(c)   Notwithstanding paragraph (b) above, no acceleration of exercisability
      shall occur with respect to any Option if the Board (or the Committee)
      reasonably determines in good faith, prior to the occurrence of a Change
      of Control, that such Option shall be honored or assumed, or new rights
      substituted therefor (such honored, assumed or substituted Option


                                       29
<PAGE>   30

      being hereinafter referred to as an "Alternative Option") by the successor
      in interest to the Company, provided that any such Alternative Option
      must:

      (i)   provide Grantee with rights and entitlements substantially
            equivalent to or better than the rights, terms and conditions
            applicable under the Option, including, but not limited to, an
            identical or better exercise and vesting schedule and identical or
            better timing and methods of payment;

      (ii)  have substantially equivalent economic value to such Option
            (determined at the time of the Change of Control); and

      (iii) have terms and conditions which provide that, in the event that the
            Company involuntarily terminates employment of Grantee for any
            reason or if the Grantee terminates employment for Good Reason
            within two years following a Change of Control, any conditions on
            Grantee's rights under, or any restrictions on exercisability
            applicable to, each such Alternative Option shall be waived or shall
            lapse, as the case may be and the Alternative Option shall remain
            exercisable until the second anniversary of the Change of Control
            or, if longer, for the period during which such Alternative Option
            would otherwise be exercisable in accordance with its terms or the
            provisions of the plan under which it is granted that permit the
            longest post-termination exercise period for involuntary
            terminations (other than due to death, disability or retirement).

                                   ARTICLE VII

                                   OTHER TERMS

(a)   Grantee understands that the Grantee shall not have any rights as
      stockholder by virtue of the grant of an Option but only with respect to
      shares of Common Stock actually issued to the Grantee in accordance with
      the terms hereof.

(b)   Anything herein to the contrary notwithstanding, the Company may postpone
      the exercise of the Option for such time as the Committee in its
      discretion may deem necessary, in order to permit the Company with
      reasonable diligence (i) to effect or maintain registration under the
      Securities Act of 1933, as amended, of the Plan or the shares of Common
      Stock issuable upon the exercise of the Option, or (ii) to determine that
      the Plan and such shares are exempt from registration; and the Company
      shall not be obligated by virtue of this Option Agreement or any provision
      of the Plan to recognize the exercise of the Option or to sell or issue
      shares of Common Stock in violation of said Act or of the law of any
      government having jurisdiction thereof. Any such postponement shall not
      extend the Term of the Option; and neither the Company nor its Board shall
      have any obligation or liability to the Grantee, or to the Grantee's
      Successor, with respect to any shares of Common Stock as to which the
      Option shall lapse because of such postponement.


                                       30
<PAGE>   31

(c)   The Option shall be nontransferable and nonassignable except by will and
      by the laws of descent and distribution. During the Grantee's lifetime,
      the Option may be exercised only by the Grantee.

(d)   This Option is not an incentive stock option as described in the Internal
      Revenue Code of 1986, as amended, Section 422A (b).

(e)   This Agreement is subject to the 1994 Stock Incentive Plan heretofore
      adopted by the Company and approved by its shareholders. The terms and
      provisions of the Plan (including any subsequent amendments thereto) are
      hereby incorporated herein by reference. In the event of a conflict
      between any term or provision contained herein and a term or provision of
      the Plan, the applicable terms and provisions of the Plan will govern and
      prevail.

IN WITNESS WHEREOF, AETNA LIFE AND CASUALTY COMPANY has caused this Option
Agreement to be executed as of the Effective Date, and Grantee has accepted the
terms and provisions hereof.

                                    AETNA LIFE AND CASUALTY COMPANY

                                    By _____________________________________
                                                     Its Chairman


Accepted: __________________________
         (Signature)

Name: ______________________________

Title: _____________________________

Social Security Number: ____________

Dated: _____________________________


                                       31
<PAGE>   32

                                             EXHIBIT B TO EMPLOYMENT AGREEMENT


                                RELEASE AGREEMENT


      I, ________________ , acknowledge that this document accurately reflects
an agreement entered into between me and Aetna Life and Casualty Company (the
"Company") as of this __ day of ___________, 199__. In consideration for the
benefits and consideration set forth in Paragraph 6 of the attached employment
agreement (the "Agreement"), I hereby agree to the following:

      1. DEFINITION. In this agreement the word "Company" means not only the
Company by which I was employed, but also parent and subsidiary corporations,
any affiliated entities whether or not incorporated, the employee, agents,
officers, directors and shareholders of all such entities and any person or
entity which may succeed to the rights and liabilities of such entities by
assignment or otherwise.

      2. RELEASE. I hereby release and hold harmless (on behalf of myself and my
family, heirs, executors, successors and assigns) now and forever, the Company
from and waive any claim that I have presently, may have or have had in the
past, known or unknown, against the Company by reason of my employment by the
Company including, without limitation, the termination thereof, other than
claims I may have (i) to the payment of amounts due and payable in accordance
with the terms of the Agreement, including without limitation the Severance
Benefits and the Vested Benefits (as each such term is defined in the Agreement)
and (ii) to be indemnified by the Company pursuant to its applicable policies
and practices from and against any third party claims arising out of or relating
to Executive's employment with or other services on behalf of the Company or any
subsidiary of the Company.

      3. EXTENT OF RELEASE. This agreement is valid whether any claim arises
under any federal, state or local statute (including, without limitation, Title
VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age
Discrimination in Employment Act of 1967, the Equal Pay Act, the Americans with
Disabilities Act of 1990, the Employee Retirement Income Security Act of 1974
and all other statutes regulating the terms and conditions of my employment),
regulation or ordinance, under the common law or in equity (including any claims
for wrongful discharge or otherwise), or under any policy, agreement,
understanding or promise, written or oral, formal or informal, between the
Company and myself.

      4. CONSIDERATION. The consideration hereby provided to me under the
Agreement is not required under the Company's standard policies and I know of no
circumstances other than my agreeing to the terms of this agreement which would
require the Company to provide such consideration.


                                       32
<PAGE>   33

      5. RESTRICTIONS. I have not filed, nor will I initiate or cause to be
initiated on my behalf, any complaint, charge, claim or proceeding against the
Company before any local, state or federal agency, court or other body relating
to my employment or the termination thereof (each individually a "Proceeding"),
nor will I participate in any Proceeding. I waive any right I may have to
benefit in any manner from any relief (whether monetary or otherwise) arising
out of any Proceeding, including any EEOC proceeding. I understand that by
entering into this agreement, I will be limiting the availability of certain
remedies that I may have against the Company and limiting also my ability to
pursue certain claims against the Company. The foregoing will not be used to
justify interfering with any right I may have to file a charge or participate in
an investigation or proceeding conducted by the EEOC.

      6. PENALTIES. If I initiate or participate in any legal actions, as
described above, the Company shall have the right, but shall not be obligated,
to deem this agreement void without effect and to require me to repay to the
Company any amounts (other than Earned Salary and Vested Benefits) payment of
which was conditioned on the execution of this agreement, plus interest thereon
from the original date of payment at an annual rate, compounded semi-annually,
equal to the prime rate as quoted in the Wall Street Journal on my date of
termination, plus 2 percent and to terminate any benefit or payments (other than
with respect to Vested Benefits) that are otherwise payable under the Agreement.

      7. RIGHT TO COUNSEL. The Company advises me that I should consult with an
attorney prior to execution of this agreement and the Agreement. I understand
that it is in my best interest to have this document and the Agreement reviewed
by an attorney of my own choosing and at my own expense, and I hereby
acknowledge that I have been afforded a period of at least twenty-one days
during which to consider this agreement and the Agreement and to have this
agreement and the Agreement reviewed by my attorney.

      8. SEVERABILITY CLAUSE. Should any provision or part of this agreement be
found to be invalid or unenforceable, only that particular provision or part so
found and not the entire agreement shall be inoperative.

      9. EVIDENCE. This document may be used as evidence in any proceeding
relating to my employment or the termination thereof. I waive all objections as
to its form.

      10. FREE WILL. I am entering into this agreement and the Agreement of my
own free will. The Company has not exerted any undue pressure or influence on me
in this regard. I have had reasonable time to determine whether entering into
this agreement and the Agreement is in my best interest. I understand that if I
request additional time to review the provisions of this agreement and the
Agreement, a reasonable extension of time will be granted.

      11. REVOCATION. This agreement may be revoked by me within seven days
after the date on which I sign this agreement and I understand that this
agreement and the Agreement are not binding or enforceable until such seven day
period has expired. Any such revocation must be made in a signed letter executed
by me and received by the Company at the following address no later than 5 p.m.
Eastern Standard Time on the seventh day after I have executed this agreement


                                       33
<PAGE>   34

and the Agreement: _________________________________. I understand that if I
revoke this agreement, the Agreement will not be effective or enforceable and I
will not be entitled to any benefits thereunder.

      12. NON-ADMISSION. Nothing contained in this agreement shall be deemed or
construed as an admission of wrongdoing or liability on the part of the Company.

      13. GOVERNING LAW. This agreement and the Agreement shall be construed in
accordance with the laws of the State of Connecticut, applicable to contracts
made and entirely to be performed therein.


Date: ________________________      ______________________________


                                       34
<PAGE>   35

[LOGO]                                               Interoffice Communication

                                                     Mary Ann Champlin
                                                     Aetna Human Resources, RC3A
                                                     (860) 273-8371
                                                     Fax: (860) 560-8721


To       Frederick C. Copeland, Jr.

Date     July 22, 1996

Subject  EMPLOYMENT AGREEMENT


I am pleased to inform you that effective July 19, 1996, Aetna Inc. has
assumed all of the obligations of Aetna Services, Inc. (formerly Aetna Life
and Casualty Company) under your Employment Agreement with Aetna Services,
Inc.  All references to the "Company" in your Employment Agreement will
hereinafter be deemed to mean both Aetna Services, Inc. and Aetna Inc.  Among
other things, this means that the Change in Control provisions of your
Employment Agreement would be triggered by a change in control of either
Aetna Services, Inc. or Aetna Inc.

By way of background, Aetna Inc. became the ultimate parent within the Aetna
holding company system as a result of the merger with U. S. Healthcare.  Your
Employment Agreement was entered into with Aetna Services, Inc., which is now
a direct subsidiary of Aetna Inc.  We felt it would be appropriate for the
new ultimate parent, Aetna Inc., to assume these obligations to place you on
an equivalent footing post-merger.

The assumption of your Employment Agreement is self-executing. You do not need
to take any action in response to this letter. If you have any questions or
concerns, please let me know.


                                                /s/ Mary Ann Champlin


                                       35
<PAGE>   36

[LOGO]                                             Interoffice Communication

                                                   Richard L. Huber
                                                   President and Chief Executive
                                                   Officer
                                                   A801
                                                   (860) 273-7851
                                                   Fax: (860) 273-6872


To       Frederick C. Copeland, Jr.

Date     September 26, 1997

Subject  Pension Credit


This memorandum is to confirm that paragraph 7 of my letter to you dated June 6,
1995 regarding your pension benefits is amended in its entirety and replaced
with the following:

        Your participation in the pension plan will begin after you have
    completed one year of service with Aetna. Under the terms of the plan
    currently in effect, you will receive credit for your actual years of
    service from your date of employment and your benefit will vest after five
    years of such service. We also will credit you under a supplemental plan
    with an additional eight years of service as follows: the first after two
    years of active service; the second after three years of active service; the
    third and fourth after four years of active service; the fifth after five
    years of active service; the sixth after six years of active service; the
    seventh after seven years of active service; and the eighth after eight
    years of active service. Under the regular plan, you will accumulate one
    year for each year you remain in the employ of the Company (but no more than
    35 years of actual and credited service combined will accumulate under both
    plans) as long as the plans remain in effect.

Your Employment Agreement with the Company dated as of December 21, 1995 remains
in full force and effect.

Please sign and return one copy of this memorandum to evidence your agreement.

Aetna Inc.

By:   /s/ Richard L. Huber       Date:       9/30/97
      --------------------                   -------
      Richard L. Huber

Agreed and Accepted:

By:   /s/ Frederick C. Copeland, Jr.
      ------------------------------
      Frederick C. Copeland, Jr.

                                       36