<PAGE>
 
                                                              EXHIBIT 10.8 (III)

                              AMENDMENT NUMBER 12
                              -------------------

                                    to the
                                    ------

                      QUOTA SHARE RETROCESSION AGREEMENT
                                    between
         THE CONTINENTAL INSURANCE COMPANY, (one of the CNA Insurance
                                  Companies)
                                      and
                           USF RE INSURANCE COMPANY
                (hereinafter referred to as "Retrocessionaire")


The Quota Share Retrocession Agreement ("Agreement") between The Continental
Insurance Company and USF RE INSURANCE COMPANY, dated May 21, 1986, and as
amended to date, is hereby further amended, effective as of June 1, 1996, as
follows:

ARTICLE IV - RETROCESSIONAIRE'S LIABILITY is deleted in its entirety and
----------   ----------------------------                               
replaced with the following:

The Retrocedent shall cede and the Retrocessionaire shall accept a Quota Share
of the Retrocedent's net retained primary liability on all business covered
hereunder, subject to maximum cession limits as follows:

1. under any medical stop-loss policy issued or renewed on or after June 1, 1996
of 50% of the Retrocedent's net retained primary liability to maximum cession
limits of $2,500,000 for specific excess medical stop-loss coverages and
$1,000,000 for aggregate excess medical stop-loss coverages; and

2. under any one provider excess reimbursement policy issued or renewed on or
after January 1, 1994 of 50% of Retrocedent's net retained primary liability to
maximum cession limits of $2,500,000.

It is understood and agreed that the maximum cession limits stated above shall
apply separately to provider excess reimbursement, specific excess medical stop
loss coverage and aggregate stop-loss or advance funding aggregate reinsurances.

"Net retained primary liability," as used herein, shall mean the Retrocedent's
liability for the full policy limits of $5,000,000 for provider excess
reimbursement and specific excess coverages and $2,000,000 for aggregate excess
coverage
<PAGE>
 
on account of loss, or series of losses as respects each individual excess
reinsurance, each aggregate stop-loss reinsurance, and each advance funding
aggregate reinsurance, as provided for in reinsurance agreements which are
bound, issued, or renewed during the currency of this Agreement.

It is agreed that the Retrocedent shall retain 50% of the net retained primary
liabilities, as defined above, for its own net account. It is further agreed
that the obligations as of the parties for reinsurance agreements in force prior
to June 1, 1996, shall be governed by the terms of this Agreement as in effect
when such reinsurance agreements were issued or renewed.

IN WITNESS WHEREOF this Amendment has been executed in Chicago, IL this 19/th/
day of January 1999.

                                        THE CONTINENTAL INSURANCE COMPANY

                                        By: /s/ [SIGNATURE ILLEGIBLE]^^
                                           ----------------------------------
                                        Title:     SVP  
                                              -------------------------------

and in Costa Mesa, California, this 25/th/ day of January, 1999.


                                        USF RE INSURANCE COMPANY   


                                        By: /s/ [SIGNATURE ILLEGIBLE]^^
                                           ----------------------------------
                                        Title: President                       


                                       2
<PAGE>
 
                              AMENDMENT NUMBER 11
                              -------------------

                                    to the
                                    ------

                      QUOTA SHARE RETROCESSION AGREEMENT
                                    between
         THE CONTINENTAL INSURANCE COMPANY, (one of the CNA Insurance
                                  Companies)
                                      and
                           USF RE INSURANCE COMPANY
                (hereinafter referred to as "Retrocessionaire")

The Quota Share Retrocession Agreement ("Agreement") between The Continental
Insurance Company and USF RE INSURANCE COMPANY, dated May 21, 1986, and as
amended to date, is hereby further amended, effective as of January 1, 1994, as
follows:


ARTICLE I - BUSINESS COVERED is deleted in its entirety and replaced with the
---------   ----------------
following:

The Retrocedent agrees to retrocede and the Retrocessionaire agrees to accept,
by way of retrocession on the terms and conditions hereinafter appearing, a
Quota Share of the Retrocedent's net retained primary liability (in the amount
specified in Article IV hereof) under all insurance policies, contracts and
agreements underwritten by USBenefits Insurance Services, Inc., on behalf of the
Retrocedent (hereinafter referred to as "reinsurance agreements"), which are
classified as either:

     (1)  Medical Stop-loss insurance, being reinsurance agreements issued to
     self-insured employers providing specific excess protection and/or
     aggregate stop-loss or advance funding aggregate protection, including any
     continuation of coverage or extension of coverage endorsements issued in
     conjunction therewith, and including the credit risk associated with the
     Advance Funding Aggregate Plan, or

     (2)  Provider Excess Reimbursement insurance issued to hospitals and other
     providers of medical services under capitated fee arrangements to limit the
     financial liability of the medical service provider under its managed care
     arrangements with managed care organizations on a per participant (member)
     and/or aggregate basis. Such provider excess
<PAGE>
 
     reimbursement insurance shall be limited to a maximum of $5,000,000 per
     member, per policy year.

ARTICLE VII - PREMIUM AND COMMISSION as amended by Amendment Number 8 dated
-----------   ----------------------                        
January 16, 1991 shall remain the same with respect to Medical Stop-loss
insurance. For Provider Excess Reimbursement insurance, a new subparagraph "c"
is added to read as follows:

     c)   For Provider Excess Reimbursement insurance premiums, 41 %, which
     includes a ceding override of 5%.

ARTICLE VIII - RETROCESSION AND PROFIT COMMISSION COSTS is deleted in its
------------   ----------------------------------------   
entirety and replaced with the following:

     It is agreed that the Retrocessionaire shall pay to the Retrocecedent its
     share of the actual premiums paid by the Retrocedent for excess of loss
     retrocession protection which limits the Retrocedent's liability as
     respects business retroceded hereunder, calculated in the same proportion
     as the cession to the Retrocessionaire hereunder bears to the net retained
     primary liability of the Retrocedent. Such costs shall be calculated on an
     underwriting year basis.

     It is agreed by the Retrocedent and the Retrocessionaire that the actual
     amounts payable under the paragraph above, as respects each treaty year
     that this Agreement is in force, may not be finalized during such treaty
     year or during the term of this Agreement. In such case, the parties hereto
     agree that any additional or return costs shall be paid by the debtor party
     immediately when such final actual costs are ascertained and accounted for.

The Agreement is further amended to include Provider Excess Reimbursement
insurance, in accordance with sub-paragraph (2) of Article I, wherever reference
is made to individual excess reinsurance protection and/or aggregate stop-loss
protection.

Except to the extent it is inconsistent with the amendments set forth above, all
other terms and conditions of the Agreement apply to the Provider Excess
Reimbursement insurance.

                                       2
<PAGE>
 
IN WITNESS WHEREOF this Amendment has been executed in Chicago, IL, this 19/th/
day of January, 1999.
                                                                              
                                        THE CONTINENTAL INSURANCE COMPANY     
                                                                              
                                        By: /s/ [SIGNATURE ILLEGIBLE]^^
                                           ---------------------------------- 
                                        Title:     SVP                        
                                              ------------------------------- 
                                                                              
and in Costa Mesa, California, this 25/th/ day of January, 1999.                
                                                                              
                                                                              
                                        USF RE INSURANCE COMPANY              
                                                                              
                                                                              
                                        By: /s/ [SIGNATURE ILLEGIBLE]^^
                                           ---------------------------------- 
                                        Title: President                      

                                       3
<PAGE>
 
                              AMENDMENT NUMBER 10


                                   to the   
                                                                           
                                                                           
                           QUOTA SHARE RETROCESSION
                                                                         

                                    between


                       THE CONTINENTAL INSURANCE COMPANY

                  (hereinafter referred to as "Retrocedent")


                                      and


                           USF RE INSURANCE COMPANY

                (hereinafter referred to as "Retrocessionaire")


The Quota Share Retrocession Agreement between The Continental Insurance Company
and USF RE INSURANCE COMPANY, dated May 21, 1986, and as amended to date, is
hereby further amended effective January 1, 1995, as follows:

ARTICLE IV - RETROCESSIONAIRE'S LIABILITY is deleted in its entirety and
----------   ----------------------------                               
replaced with the following:

The Retrocedent shall cede and the Retrocessionaire shall accept a Quota Share
of the Retrocedent's net retained primary liability on all business covered
hereunder, subject to maximum cession limits under any one reinsurance agreement
(medical stop-loss policy) issued or renewed on or after January 1, 1995, of 50%
of the Retrocedent's net retained primary liability to maximum cession limits of
$500,000 for specific excess medical stop-loss coverages and $1,000,000 for
aggregate excess medical stop-loss coverages.

It is understood and agreed that the maximum cession limits stated above shall
apply separately to individual excess reinsurance and aggregate stop-loss or
advance funding aggregate reinsurances.
<PAGE>
 
"Net retained primary liability," as used herein, shall mean the Retrocedent's
liability for the full policy limits of $1,000,000 for specific excess coverages
and $2,000,000 for aggregate excess coverage on account of loss, or series of
losses as respects each individual excess reinsurance, each aggregate stop-loss
reinsurance, and each advance funding aggregate reinsurance, as provided for in
reinsurance agreements which are bound, issued, or renewed during the currency
of this Agreement.

It is agreed that the Retrocedent shall retain 50% of its net retained primary
liabilities, as defined above, for its own net account. It is further agreed
that the obligations as of the parties for reinsurance agreements in force prior
to January 1, 1995, shall be governed by the terms of this Agreement as in
effect when such reinsurance agreements were issued or renewed.

IN WITNESS WHEREOF, this Amendment has been executed in Chicago, IL, this 25/th/
day of August, 1995.


                              THE CONTINENTAL INSURANCE COMPANY                
                                                                              
                              By: /s/ [SIGNATURE ILLEGIBLE]^^
                                 -------------------------------------------- 

                              Title: GROUP VICE PRESIDENT                      
                                    -----------------------------------------

and in Costa Mesa, California, this 23rd day of August, 1995.

                              USF RE INSURANCE

                              By: /s/ [SIGNATURE ILLEGIBLE]^^ 
                                 --------------------------------------------
                              Title:  President

                                       2