<PAGE>
                                                                    EXHIBIT 10.4

                        LYONDELL PETROCHEMICAL COMPANY

                            EXECUTIVE MEDICAL PLAN






                        EFFECTIVE AS OF OCTOBER 1, 1990
<PAGE>
 
                               TABLE OF CONTENTS
                               -----------------

<TABLE>
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<S>                                                                         <C>
1.   ADMINISTRATION OF THE PLAN............................................    1
     1.1.   Purpose........................................................    1
     1.2.   Delegation of Certain Fiduciary Responsibilities...............    1

2.   ELIGIBILITY AND EFFECTIVE DATES.......................................    3
     2.1.   Eligibility....................................................    3
     2.2.   Enrollment.....................................................    3
     2.3.   Effective Date of Coverage.....................................    4
     2.4.   Dependents.....................................................    4
     2.5.   COBRA and Non-COBRA Coverage Under The Plan....................    5
     2.6.   Change in Coverage Procedure...................................    6

3.   COVERAGE..............................................................    7
     3.1.   Claims Administrator...........................................    7
     3.2.   Percentages Payable............................................    7
     3.3.   Lifetime Maximum Benefit Amount................................    7
     3.4.   Covered Medical Expenses - Regular Expenses....................    7
            (A)    Hospital Expenses.......................................    8
            (B)    Convalescent Facility Expense...........................    9
            (C)    Preoperative Testing Expenses...........................   10
            (D)    Surgical Expenses.......................................   11
            (E)    Birthing Center Expenses................................   13
            (F)    Laboratory And X-Ray Expenses...........................   14
            (G)    In-Hospital Physician Expenses..........................   14
            (H)    In-Hospital Consultation Expenses.......................   15
            (I)    Emergency Medical Physician Expenses....................   16
     3.5.   Covered Medical Expenses - Major Medical
            Expenses Associated with Injury or Disease.....................   16
            (A)    Hospital Expenses.......................................   17
            (B)    Convalescent Facility Expenses..........................   17
            (C)    Freestanding Surgical Expenses..........................   18
            (D)    Home Health Care Expenses...............................   18
            (E)    Hospice Care Expenses...................................   19
            (F)    Dental Expenses Related to Accidents....................   21
            (G)    Certain Medical Expenses Related to
                   Accidents...............................................   21
     3.6.   Covered Medical Expenses - Major Medical
            Expenses Not Associated with Injury or
            Disease........................................................   21
            (A)    Physical Exam Expenses..................................   22
            (B)    Mental Health Problem Expenses..........................   23
            (C)    Other Medical Expenses..................................   24
     3.7.   Treatment of Substance Dependency..............................   26
            (A)    Inpatient Confinement Expenses..........................   26
            (B)    Outpatient Expenses.....................................   27
     3.8.   Limitations and Exclusions-General.............................   29
</TABLE> 

                                      (i)
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<TABLE>
<CAPTION>
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<S>                                                                         <C>
     3.9.   Limitations and Exclusions - Major Medical
            Expenses......................................................... 32
            (A)   Mouth, Jaws and Teeth...................................... 32
            (B)   Mammographies.............................................. 35

4.   COORDINATION OF THE PLAN'S BENEFITS WITH OTHER BENEFITS................. 36
     4.1.   Applicability.................................................... 36
     4.2.   Definitions...................................................... 36
            (A)   Calendar Year.............................................. 36
            (B)   Plan....................................................... 36
            (C)   This Plan.................................................. 37
            (D)   Primary Plan/Secondary Plan................................ 37
            (E)   Allowable Expense.......................................... 37
            (F)   Claim Determination Period................................. 37
     4.3.   Order of Benefit Determination Rules............................. 38
            (A)   General.................................................... 38
            (B)   Rules...................................................... 38
     4.4.   Effect on the Benefits of this Plan.............................. 40
            (A)   When This Section Applies.................................. 40
            (B)   Reduction in This Plan's Benefits.......................... 40
     4.5.   Right to Receive and Release Needed Information.................. 41
     4.6.   Facility of Payment.............................................. 41
     4.7.   Right of Recovery................................................ 41
     4.8.   Multiple Coverage Under This Plan................................ 42
     4.9.   Special Provisions Applicable to Persons
            Eligible for Medicare............................................ 42
            (A)   Applicability.............................................. 42
            (B)   Regular Expenses Calculation............................... 42
            (C)   Major Medical Expenses Calculation......................... 43
            (D)   Medicare Benefits.......................................... 43

5.   TERMINATION OF COVERAGE................................................. 44
     5.1.   Executives....................................................... 44
     5.2.   Dependents....................................................... 44
     5.3.   Handicapped Dependent Child...................................... 45
     5.4.   Retiree.......................................................... 46
     5.5.   Continuation of Coverage Related to Pregnancy.................... 46
     5.6.   Continuation of Coverage Under Certain
            Circumstances.................................................... 46

6.   CONTINUATION COVERAGE (COBRA)........................................... 48
     6.1.   Entitlement to COBRA Coverage.................................... 48
            (A)   Covered as an Executive.................................... 48
            (B)   Covered as a Dependent Spouse.............................. 48
            (C)   Covered as a Dependent..................................... 48
     6.2.   Types of Coverage................................................ 48
     6.3.   Notice of COBRA Events........................................... 49
     6.4.   Duration of COBRA Coverage....................................... 49
</TABLE> 
                                     (ii)
<PAGE>
 
<TABLE> 
<CAPTION> 
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<S>                                                                         <C> 
     6.5.   Termination of COBRA Coverage.................................... 50
     6.6.   Cost of COBRA Coverage........................................... 50
     6.7.   Conversion Health Plans.......................................... 51
     6.8.   Questions About COBRA Coverage................................... 51
           
7.   LEAVES OF ABSENCE....................................................... 52
     7.1.   General.......................................................... 52
     7.2.   Entitlement to Coverage During Family and
            Medical Leave.................................................... 52
     7.3.   Duration of Coverage During Family and Medical
            Leave............................................................ 52
     7.4.   Disqualified Leave and Integration with COBRA.................... 52
           
8.   CONVERSION PRIVILEGE.................................................... 54
     8.1.   General.......................................................... 54
     8.2.   Eligibility for Conversion Privilege............................. 54
     8.3.   Right to Convert................................................. 54
     8.4.   Restrictions..................................................... 55
     8.5.   Renewal.......................................................... 56
     8.6.   Form of Converted Policy......................................... 56
     8.7.   Premiums......................................................... 56
     8.8.   Effective Date................................................... 56
     8.9.   Converted Policy Provisions...................................... 56
           
9.   CLAIMS.................................................................. 58
     9.1.   Submission of Claims............................................. 58
     9.2.   Claim Form....................................................... 58
     9.3.   Time Limit for Claims............................................ 58
     9.4.   Examination...................................................... 58
     9.5.   Right to Receive and Release Necessary
            Information...................................................... 58
     9.6.   Payment of Claim................................................. 59
     9.7.   Direction to Pay/Non-Assignability of
            Benefits......................................................... 59
     9.8.   Medicaid Assignments............................................. 59
     9.9.   Charges Reported in Foreign Currency............................. 60
     9.10.  Facility of Payment.............................................. 60
     9.11.  Right of Recovery................................................ 60
     9.12.  Subrogation...................................................... 60
            (A)   Plan's Right to Reimbursement.............................. 60
            (B)   Covered Person's Agreement To
                  Subrogation................................................ 61
            (C)   Limitation To Plan's Subrogation
                  Rights..................................................... 62
            (D)   Subrogation Rights Not Affected By
                  Payment.................................................... 62
            (E)   Lien on Proceeds........................................... 62
     9.13.  Review and Appeal of Claim....................................... 63
     9.14.  Authority of Claims Administrator................................ 63
     9.15.  Interpretation and Administration................................ 63
</TABLE> 

                                     (iii)
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<TABLE> 
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     9.16.   Legal Actions................................................... 65
     9.17.   Qualified Medical Child Support Orders.......................... 65

10.  GENERAL PROVISIONS...................................................... 66
     10.1.   Benefits........................................................ 66
     10.2.   Compliance with Federal Law..................................... 66
     10.3.   Effective Times................................................. 66
     10.4.   Errors/Delays................................................... 66
     10.5.   Entire Contract................................................. 66
     10.6.   Physical Examination and Autopsy................................ 66
     10.7.   Termination or Amendment of the Plan............................ 67
     10.8.   No Replacement for Workers' Compensation........................ 67
     10.9.   Physician-Patient Relationship.................................. 67
     10.10.  Representations................................................. 67
     10.11.  Misstatements of Eligibility Information........................ 67
     10.12.  Mistake of Fact................................................. 67
     10.13.  Reliance on Documents and Information........................... 67
     10.14.  Waiver.......................................................... 68
     10.15.  Plan Not a Contract of Employment............................... 68
     10.16.  No Guarantee of Tax Consequences................................ 68
     10.17.  Severability.................................................... 68
     10.18.  Construction.................................................... 68
     10.19.  Governing Law................................................... 69
 
11.  DEFINITIONS............................................................. 70
     11.1.   Accident........................................................ 70
     11.2.   Actively at Work or Active Full-Time Work....................... 70
     11.3.   Administrator................................................... 70
     11.4.   Benefits........................................................ 70
     11.5.   Birthing Center................................................. 70
     11.6.   Board and Room Charges.......................................... 71
     11.7.   Child........................................................... 71
     11.8.   Claims Administrator............................................ 72
     11.9.   COBRA........................................................... 72
     11.10.  Company......................................................... 72
     11.11.  Convalescent Facility........................................... 72
     11.12.  Cover, Covered and Coverage..................................... 72
     11.13.  Covered Expenses or Covered Medical Expenses.................... 72
     11.14.  Covered Person.................................................. 73
     11.15.  Custodial Care.................................................. 73
     11.16.  Dentist......................................................... 73
     11.17.  Dependent....................................................... 73
     11.18.  Diagnosis Related Group (DRG)................................... 74
     11.19.  DRG Amount...................................................... 74
     11.20.  Durable Medical Equipment....................................... 74
     11.21.  Effective Date.................................................. 74
     11.22.  Effective Treatment of Substance Dependency..................... 74
     11.23.  Executive....................................................... 75
     11.24.  ERISA........................................................... 75
     11.25.  Experimental.................................................... 75
</TABLE> 

                                     (iv)
<PAGE>
 
<TABLE> 
<CAPTION> 
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     <S>                                                                    <C> 
     11.26.  FMLA Leave...................................................... 75
     11.27.  FMLA Policy..................................................... 75
     11.28.  Freestanding Surgical Facility.................................. 76
     11.29.  Health Care Provider............................................ 76
     11.30.  Home Health Care................................................ 76
     11.31.  Home Health Care Agency......................................... 77
     11.32.  Home Health Care Plan........................................... 77
     11.33.  Hospice Care.................................................... 78
     11.34.  Hospice Care Agency............................................. 78
     11.35.  Hospice Care Program............................................ 79
     11.36.  Hospice Facility................................................ 79
     11.37.  Hospital........................................................ 80
     11.38.  Incurred........................................................ 80
     11.39.  Injury.......................................................... 80
     11.40.  Intensive Care Unit............................................. 80
     11.41.  Medical Emergency............................................... 80
     11.42.  Medicare........................................................ 81
     11.43.  Medicare Eligibility............................................ 81
     11.44.  Mental Health Problems.......................................... 81
     11.45.  Necessary....................................................... 81
     11.46.  Non-occupational Disease........................................ 82
     11.47.  Non-occupational Injury......................................... 82
     11.48.  Obstetric Care.................................................. 82
     11.49.  Office Visit.................................................... 83
     11.50.  Orthodontic Treatment........................................... 83
     11.51.  Period of Hospital Confinement.................................. 83
     11.52.  Pharmacy........................................................ 83
     11.53.  Physician....................................................... 83
     11.54.  Plan............................................................ 84
     11.55.  Plan Document................................................... 84
     11.56.  Plan Year....................................................... 84
     11.57.  Prescription.................................................... 84
     11.58.  Prescription Drugs.............................................. 84
     11.59.  Reasonable Charge............................................... 84
     11.60.  Retiree......................................................... 85
     11.61.  Sickness........................................................ 85
     11.62.  Skilled Nursing Care............................................ 86
     11.63.  Spouse.......................................................... 86
     11.64.  Substance Dependency............................................ 87
     11.65.  Surgical Services............................................... 87
     11.66.  Terminally Ill.................................................. 87
     11.67.  Total Disability and/or Totally Disabled........................ 87
     11.68.  Treatment Facility.............................................. 88
     11.69.  Treatment of a Mental Health Problem............................ 88
</TABLE>

                                      (v)
<PAGE>
 
                         LYONDELL PETROCHEMICAL COMPANY

                             EXECUTIVE MEDICAL PLAN

                          ___________________________

1.   ADMINISTRATION OF THE PLAN.

     1.1.  Purpose.  This document sets forth the terms and conditions of the
           Plan with respect to the provision of medical benefits, including all
           requirements with respect to eligibility, coverage, exclusions and
           limitations on coverage and rules pertaining to the administration of
           the Plan.  This document serves as the Lyondell Petrochemical Company
           Executive Medical Plan (the "Plan") and, as such, constitutes a part
           of such Plan as fully as if set forth therein.  The capitalized terms
           set forth herein shall have the meanings assigned to them in Section
           11 of the Plan.

    1.2.   Delegation of Certain Fiduciary Responsibilities.  The Claims
           Administrator is the named fiduciary under ERISA with respect to all
           matters set forth herein as being within the scope of the
           responsibilities of the Claims Administrator and, as such, the Claims
           Administrator shall exercise complete discretionary power and
           authority under the Plan with respect to any such matters, including
           but not limited to the authority to make all decisions with respect
           to:

           (A)  the administration, initial determination, review and final
                determination of any and all claims for Benefits under the Plan
                (including, but not limited to the administration of any claims
                procedures required by ERISA), the authorization in writing of
                all disbursements and the preparation of all communications to
                the Covered Person and other interested parties with respect to
                any such claim;

           (B)  the initial determination of the eligibility of an Executive or
                Retiree or a Dependent of an Executive or Retiree to participate
                in the Plan, provided that any final determination of
                eligibility shall be made by the Administrator;

           (C)  the construction and interpretation of all terms, provisions,
                conditions and limitations of the Plan pertaining to such
                determinations that have been delegated to the Claims
                Administrator (including but not limited to the definition of
                Covered
<PAGE>
 
                Expenses and the determination of the rates at which a Benefit
                shall be paid), the reconciliation of any inconsistency or the
                supplying of any omitted detail that may appear in the Plan in
                such manner and to such extent, consistent with the general
                terms of the Plan, as the Claims Administrator shall deem
                necessary or appropriate, and the promulgation and enforcement
                of such rules and regulations for the administration of the Plan
                as are not inconsistent with its terms;

           (D)  any and all decisions concerning and pursuit of litigation
                involving (1) issues pertaining to the denial in whole or in
                part of Benefits and the recovery of overpayments of Benefits or
                (2) the actions of the employees or agents of the Claims
                Administrator; and

           (E)  any and all powers necessary for the accomplishment of such
                purposes as the Claims Administrator, in its discretion, shall
                deem necessary or appropriate for the administration of the Plan
                in accordance with its terms and for the benefit of Covered
                Persons and, for these purposes, the Claims Administrator may
                consult with the Administrator.

           The Administrator reserves the absolute right and power to make all
           final determinations with respect to eligibility of Covered Persons
           to participate in any aspect of the Plan and with respect to any
           other issue unrelated to payment of claims for Benefits under the
           Plan. Any such determination made by the Administrator under the Plan
           shall be final, binding and conclusive upon all persons and entities.

                                       2
<PAGE>
 
2.   ELIGIBILITY AND EFFECTIVE DATES.

     2.1.  Eligibility.  Subject to completion of the enrollment requirements of
           Section 2.2, each Executive or Dependent shall be eligible to become
           a Covered Person on the first date that the Executive enters Active
           Full-Time Service with the Company on the Executive payroll.  If the
           Executive has transferred to the executive payroll from another
           Company payroll, the Executive shall be eligible to participate in
           this Plan on the date of transfer.  A Retiree who was eligible to
           participate in the Plan on the date immediately preceding the date of
           his retirement from Active Full-Time Service with the Company shall
           continue to be eligible to participate in the Plan from and after the
           date of his retirement.

           Notwithstanding any provision of the Plan to the contrary, to the
           extent required by the Omnibus Budget Reconciliation Act of 1993,
           P.L. 103-66, a Child who becomes eligible for Coverage under this
           Plan as a Dependent by virtue of his adoption or placement for
           adoption with an Executive or Retiree shall be eligible to receive
           Benefits on the same terms and conditions as apply in the case of any
           natural born or adopted Dependent Child and shall not be subject to
           preexisting condition limitations.

    2.2.   Enrollment.

           Each Executive or Retiree shall:

           (A)  Complete an enrollment form approved by the Administrator or its
                delegate naming himself and each of his Dependents, if any, to
                be Covered;

           (B)  Agree to make any required contributions (as determined by the
                Company); and

           (C)  Submit the completed form to the Company or its delegate within
                31 consecutive days of the date the Executive (or, in the case
                of a newly acquired Dependent, the Dependent) becomes eligible
                for Coverage.

           If the enrollment form is not received within the 31 consecutive day
           period immediately following the date the person becomes eligible for
           Coverage, or if the Executive or Retiree withdraws from the Plan and
           later reenrolls, the Executive or Retiree must submit, at his own
           expense, evidence of good health acceptable to the Claims
           Administrator.

                                       3
<PAGE>
 
    2.3.   Effective Date of Coverage.  Subject to the enrollment requirements
           and the following provisions of this Section, Coverage shall become
           effective on the latest of:

           (A)  The date the enrollment form is received by the Company or its
                delegate;

           (B)  The date the Executive commences Active Full-Time Work with the
                Company on the Executive payroll;

           (C)  If the Executive transfers to the executive payroll from another
                Company payroll, the date of transfer;

           (D)  If an Executive or Retiree does not submit his enrollment form
                within 31 days of becoming eligible for Coverage, the date the
                Claims Administrator receives his request for enrollment in the
                Plan if the Claims Administrator approves the enrollment; such
                approval shall be based on evidence of good health submitted by
                the Executive or Retiree and approved by the Claims
                Administrator; or

           (E)  If an Executive is not Actively at Work on the date Coverage
                would otherwise commence, the date he returns to Active Full-
                Time Work with the Company for one full day.

    2.4.   Dependents.  A Dependent of an Executive or Retiree shall be eligible
           for Coverage on the same date the Executive or Retiree is eligible,
           subject to the enrollment requirements and except as provided below
           in the provisions concerning the effect of a change of status on
           Coverage as set forth in the section entitled "Change in Coverage
           Procedure".  In no event will a Dependent be Eligible for Coverage
           when the Executive or Retiree is not a Covered Person under this
           Plan, except as provided in (F).  No Dependent who is otherwise a
           Dependent Child shall be eligible under this Plan if the Dependent is
           also eligible as an Executive.  A Dependent who is a Dependent Spouse
           and an Executive is eligible under this Plan either as an Executive
           or as a Dependent.  Otherwise, Coverage for Dependent shall begin on
           the latest of:

           (A)  The date the Executive's or Retiree's Coverage begins;

           (B)  The date the Executive or Retiree, while Covered, acquires the
                Dependent, if the Executive or

                                       4
<PAGE>
 
                Retiree is already covered under a class of Coverage which
                covers Dependents;

           (C)  If a Dependent's enrollment form is received by the Company more
                than 31 consecutive days after the later of

                (1)  the date the Executive or Retiree acquired the Dependent or

                (2)  the date the Executive or Retiree first became eligible for
                     Coverage,

                the date the Company approves his enrollment subject to the
                provisions of (D) below; such approval shall be based on
                evidence of good health submitted by the Executive or Retiree
                and approved by the Claims Administrator.

           (D)  If a Dependent of an Executive (but not a Dependent of a
                Retiree) is confined to a Hospital, Skilled Nursing Facility,
                Hospice or Convalescent Facility or other similar facility
                because of Injury or Sickness within 31 days of the date when
                his Coverage under the Plan would otherwise become effective,
                the earlier of (1) the date such Dependent has been free of
                confinement for 31 days (including confinement at home) or (2)
                the date that satisfactory evidence of good health is approved
                by the Claims Administrator.

           (E)  If an Executive or Retiree is changing Coverage under Section
                2.6 to a class of Coverage which covers Dependents, the later of
                (1) the date the Dependent is acquired or (2) the date the
                enrollment change form is received.

           (F)  If a Dependent Spouse of an Executive would be eligible as an
                Executive under this Plan, and the Executive ceases to be
                eligible, the Dependent Spouse may enroll as an Executive, if
                not so enrolled, within 31 days from the time the Executive's
                eligibility ceased without evidence of good health acceptable to
                the Claims Administrator.

     2.5.  COBRA and Non-COBRA Coverage Under The Plan.  If, on the day
           immediately prior to the date on which a person becomes Covered under
           the Plan because of his status as an Executive, Retiree or Dependent,
           that person is enrolled in the Plan through the exercise of his
           rights to continuation coverage under COBRA, then

                                       5
<PAGE>
 
 (A)       the person's change in enrollment from COBRA Coverage to Coverage as
           an Executive, Retiree or Dependent shall not be deemed to result in a
           new effective date of Coverage for that person; and

           (B)  any limitations on Benefits set forth in this Plan shall apply
                to all Covered Medical Expenses payable during the Plan Year
                without regard to whether the Covered Medical Expenses were
                incurred during the period when the Covered Person was enrolled
                as a result of the exercise of his COBRA rights or during the
                period of his enrollment as an Executive, Retiree or Dependent.

     2.6.  Change in Coverage Procedure.

           A Covered Executive or Retiree may elect to change his level of
           Coverage by notifying his Human Resources representative within 31
           days of the date a Dependent is lost or acquired, subject to all
           relevant terms and conditions of the Plan, including those set forth
           above in the sections governing the effective dates of Coverage.

                                       6
<PAGE>
 
3.   COVERAGE.

     3.1.  Claims Administrator.  Benefits payable for Covered Medical Expenses
           are described in this Section 3 of the Plan and are administered by
           the Claims Administrator.

     3.2.  Percentages Payable.  The Plan shall pay Benefits at 100% of
           Reasonable Charges, unless otherwise provided.  Benefits shall be
           paid after satisfaction of all terms, conditions and limitations of
           this Plan.  Only charges that, in the opinion of the Claims
           Administrator, are Reasonable Charges will be considered as Covered
           Medical Expenses for which reimbursement may be obtained.

           Coverage at 100 percent shall not apply to expenses for which
           Benefits are payable under any other "plan," as defined in the
           section entitled "Coordination of Benefits."  For such expenses, the
           Plan shall not pay more than a reduced amount which, when added to
           Benefits payable under the Coordination of Benefits section, will not
           exceed 100% of Reasonable Charges covered under this Plan.

     3.3.  Lifetime Maximum Benefit Amount.  The total amount of aggregate
           Benefits available under Sections 3.5, 3.6 and 3.7 for a Covered
           Person during his lifetime is $1,000,000.00.  It may be reinstated in
           full when $1,000 or more is charged against it, if evidence of good
           health acceptable to the Claims Administrator is provided at the
           Covered Person's expense.  The Covered Person must initiate this
           process.

           On each January 1, the amount charged against a Covered Person's
           Lifetime Maximum Benefit will be automatically restored, but by not
           more than $1,000, unless otherwise authorized by the Administrator.
           The Plan will not provide benefits for Covered Medical Expenses under
           Sections 3.5, 3.6 and 3.7 that otherwise exceed the Lifetime Maximum
           Benefit and are Incurred before the date the Lifetime Benefit Maximum
           is reinstated or restored.

     3.4.  Covered Medical Expenses - Regular Expenses.

           Covered Medical Expenses under this Section 3.4 shall mean the
           following Reasonable Charges, as specified below, Incurred for a
           Covered Person while that person is Covered under the Plan:

                                       7
<PAGE>
 
           (A)  Hospital Expenses

                If a Covered Person becomes confined in a Hospital because of a
                disease or Injury, the Plan will pay the following Benefits:

                (1)  Board and Room Benefits--A Benefit equal to 100% of the
                     -----------------------                                
                     Reasonable Charges the Hospital makes for board and room,
                     but not to exceed the daily Board and Room Charge for each
                     day of confinement for which charges are made.  No Benefit
                     is payable for any days of confinement exceeding 365 days
                     during one Period of Hospital Confinement.

                (2)  Miscellaneous Benefits--A benefit equal to 100% of the
                     ----------------------                                
                     following charges:

                     (a) Reasonable Charges made by the Hospital in its own
                         behalf for services and supplies furnished in direct
                         treatment of the Covered Person, including (i) use of
                         operating, delivery, recovery and treatment rooms; (ii)
                         drugs and dressings; (iii) x-ray and laboratory tests
                         and x-ray and radiation therapy while confined in the
                         Hospital; (iv) administration of blood and blood plasma
                         by a member of the Hospital Staff and (v) physiotherapy
                         and hydrotherapy.  Miscellaneous charges specifically
                         exclude Board and Room Charges, and private or special
                         nursing services, whether or not furnished under
                         Hospital direction.

                     (b) Reasonable Charges made by an agency or a Hospital for
                         professional ambulance service when used to transport
                         the Covered Person, when Necessary.

                     (c) Reasonable Charges made by a Physician who is a member
                         of the Hospital Staff or who is an anesthesiologist who
                         is not a member of the Hospital Staff for
                         administration of anesthesia other than local
                         infiltration anesthesia to the Covered Person, but only
                         if the Physician is not the operating Physician or his
                         assistant.

                                       8
<PAGE>
 
                (3)  Limitations.  Miscellaneous Benefits are payable only for
                     -----------                                              
                     Reasonable Charges Incurred during a period for which
                     benefits for Board and Room Charges are payable, unless the
                     only Hospital charge is for any one of the following:

                     (a) Services furnished on the day of and in connection with
                         a surgical procedure.

                     (b) Emergency treatment for an injury furnished within
                         ninety-six hours of the injury.

                     (c) Emergency treatment for a medical emergency furnished
                         within ninety-six hours of the onset of the medical
                         emergency.

                     No Benefits shall be paid under subsections (1) and (2) for
                     charges associated with a routine vasectomy.

           (B)  Convalescent Facility Expenses

                If a Covered Person becomes confined in a Convalescent Facility,
                the Plan will pay a Benefit equal to 100% of the Reasonable
                Charges made by the facility in its own behalf, except as
                limited below, for the following services and supplies furnished
                by the facility to the Covered Person for use during the
                confinement and for convalescing from the disease or Injury
                causing the confinement:

                (1)  Board and room, but not to exceed the daily Board and Room
                     Charge.

                (2)  Use of special treatment rooms.

                (3)  X-Ray and laboratory examinations.
 
                (4)  Physical, occupational and speech therapy.

                (5)  Oxygen and other gas therapy.

                (6)  Other medical services customarily provided by Convalescent
                     Facilities, but not private duty or special nursing
                     services, or Physicians' services.

                (7)  Medical Supplies.

                                       9
<PAGE>
 
                Limitations
                -----------

                The maximum Benefit payable for each day of Convalescent
                Facility confinement is the Reasonable Charge made by the
                facility, excluding, however, any charge which exceeds the daily
                Board and Room Charge for each day of confinement for which
                charges are made.  No Benefit is payable under this section for
                any days of a particular confinement in excess of 30 days.

                Any Benefit payable as to a confinement in a distinct part of an
                institution which meets the definition of Convalescent Facility
                and also the definition of Hospital will be payable in
                accordance with this section rather than any Hospital Expenses
                section.

                No Benefit will be payable for care for (i)  Substance
                Dependency; (ii) chronic brain syndrome; (iii) mental
                retardation; (iv) senile deterioration; or (v) Mental Health
                Problems.

           (C)  Preoperative Testing Expenses

                If a Covered Person Incurs Preoperative Testing Expenses, the
                Plan will pay a Benefit in an amount equal to the Reasonable
                Charge for expenses, except as limited below.

                (1)  Preoperative Testing Expenses--Reasonable Charges made by a
                     -----------------------------                              
                     Physician, Hospital, surgery center, or licensed diagnostic
                     laboratory facility, in its own behalf, for outpatient
                     testing prior to scheduled surgery, but only if:

                     (a) the tests are related to the scheduled surgery;

                     (b) the tests are done within the 14 days prior to the
                         scheduled surgery or confinement as an inpatient.  If
                         the surgery or confinement occurs after 14 days the
                         tests will be covered only if they are still medically
                         useful.

                     (c) the Covered Person undergoes the scheduled surgery in a
                         Hospital or surgery center.  This does not apply if the
                         tests show that the surgery should

                                       10
<PAGE>
 
                         not be done because of the Covered Person's physical
                         condition;

                     (d) the charges for the surgery are a Covered Medical
                         Expense under this Plan;

                     (e) the tests are done while the Covered Person is not
                         confined as an inpatient in a Hospital;

                     (f) the charges for the tests would have been Covered if
                         the Covered Person was confined as an inpatient in a
                         Hospital;

                     (g) the test results appear in the Covered Person's medical
                         record kept by the Hospital or surgery center where the
                         surgery is to be done; and

                     (h) the tests are not repeated in or by the Hospital or
                         surgery center where the surgery is done.

                (2)  Post-Admission Testing Expenses--The Reasonable Charges
                     -------------------------------                        
                     made by a Hospital, in its own behalf, for tests provided
                     to a Covered Person on an out-patient basis within 14 days
                     after discharge from Hospital, which are a follow-up to the
                     condition that caused the confinement.

                (3)  Limitations--No benefit will be payable,  under this
                     -----------                                         
                     section, if a Covered Person cancels the scheduled surgery
                     or under any other section for charges Incurred for which a
                     Benefit is payable under this section.

           (D)  Surgical Expenses

                If any Surgical Services of this Plan are rendered to a Covered
                Person by a Physician for diagnosis or treatment of a disease or
                Injury, the Plan will pay a Benefit equal to 100% of the
                Reasonable Charge by the Physician for the Surgical Services,
                except as provided in (2).

                (1)  Surgical Assistance Services--The professional services of
                     ----------------------------                              
                     a Physician in rendering technical surgical assistance to
                     the operating Physician in connection with Surgical
                     Services for which Benefits are payable under this Surgical
                     Expenses section,

                                       11
<PAGE>
 
                     but only if both of the following tests are met:

                     (a) The Surgical Services are rendered while the Covered
                         Person is confined in a Hospital as an inpatient.

                     (b) The Surgical Services are rendered at a time when, as
                         determined by the Claims Administrator, surgical
                         assistance services are not routinely available as a
                         service provided by the Hospital's interns, residents
                         or house officers.

                (2)  This Plan will pay a Benefit equal to 100% of the
                     Reasonable Charge for (i) Surgical Services for
                     circumcision performed by a Physician and (ii) lawfully
                     performed voluntary sterilization procedures (tubal
                     ligation and vasectomy).

                (3)  Limitations--No Benefit will be payable for:
                     -----------                                 

                     (a) Postoperative care in connection with a surgical
                         procedure after the end of the longer of (i) the 14 day
                         period following the procedure or (ii) the period of
                         Hospital confinement during which the procedure is
                         performed.

                     (b) Diagnostic x-ray or laboratory services, x-ray or
                         radioactive therapy, or drugs or medicines.

                     (c) Dental work and oral surgery of or related to
                         conditions of the teeth, mouth, jaws, jaw joints or
                         supporting tissues, except surgery needed to

                         (i)   Cut out:

                               -  teeth partly or completely impacted in the
                                  bone of the jaw;

                               -  teeth that will not erupt through the gum;

                               -  other teeth that cannot be removed without
                                  cutting bone;
 
                               -  the roots of a tooth without removing the
                                  entire tooth.

                                       12
<PAGE>
 
                         (ii)  Cut into the gums and tissues of the mouth when
                               not done in connection with the removal or repair
                               of teeth.

                         (iii) Cut out cysts or tumors

                         (iv)  Treat a fracture, dislocation or wound.

                         (v)   Alter the jaw, jaw joints, or bite relationships
                               by a cutting procedure when appliance therapy
                               alone cannot result in functional improvement.

                         In-mouth scaling, planing or scraping, root canal
                         therapy and dental cleaning are not Covered.

                         A dentist is considered to be a Physician for purposes
                         of Covered oral surgery

                     (d) Cosmetic surgery, other than charges for Surgical
                         Services Necessary for the prompt repair of an Injury
                         resulting from an accident.

           (E)  Birthing Center Expenses

                If, because of a pregnancy, a Covered Person incurs Birthing
                Center Expenses, the Plan will pay a Benefit equal to the
                Reasonable Charge for such expenses.

                (1)  Birthing Center Expenses:  These are the charges made by a
                     ------------------------                                  
                     Birthing Center, in its own behalf, for services and
                     supplies furnished to a Covered Person for:

                     (a)  Prenatal care;

                     (b)  Delivery of a child or children;

                     (c) Postpartum care rendered within 24 hours after the
                         delivery in connection with a normal delivery.

                (2)  Limitations:  No Benefit will be paid for charges Incurred
                     -----------                                               
                     in connection with a pregnancy for which pregnancy-related
                     expenses are not Covered.

                                       13
<PAGE>
 
          (F)  Laboratory And X-Ray Expenses

               If Laboratory or X-Ray Services, as defined below, are rendered
               to a Covered Person to diagnose a disease or Injury, the Plan
               will pay a Benefit equal to the Physician's Reasonable Charge for
               the services.

               (1)  Laboratory and X-Ray Services--Any laboratory or x-ray
                    -----------------------------                         
                    examination made for diagnostic purposes, including the
                    service of a Physician in rendering or interpreting the
                    examination.

               (2)  Limitations--No Benefit will be payable for:
                    -----------                                 

                    (a)  An examination made in or through a Hospital, except an
                         examination made in connection with outpatient care for
                         which no other Benefit is payable under this Plan.

                    (b)  Any dental x-ray except in connection with an Injury or
                         oral surgery for which a Benefit is payable under the
                         Surgical Expense Benefits section. A dentist is
                         considered to be a Physician for purposes of Covered
                         dental x-rays.

                    (c)  Routine mammograms, other than one routine screening by
                         mammography for the presence of occult breast cancer
                         each calendar year for a female Covered Person age 35
                         or over.

          (G)  In-Hospital Physician Expenses

               If a Physician renders medical treatment for a disease or Injury
               to a Covered Person while the Covered Person is confined as an
               inpatient in a Hospital or Convalescent Facility, the Plan will
               pay a Benefit equal to 100% of the Physician's Reasonable
               Charges.

               (1)  Limitations--No Benefit will be payable
                    -----------                            

                    (a)  For treatment rendered during any Period of Hospital
                         Confinement which exceeds 365 days, if the Covered
                         Person is in a Hospital, or treatment rendered after 30
                         days if the Covered Person is in a Convalescent
                         Facility.

                                       14
<PAGE>
 
                    (b)  For any services for which Benefits are payable under
                         any Surgical Expenses section of this Plan, for dental
                         work or treatment, eye examinations or the fitting of
                         glasses, diagnostic x-rays, laboratory services, x-ray
                         or radioactive therapy, drugs or medicines, the
                         administering of an anesthetic, technical surgical
                         assistance rendered to an operating Physician, or
                         consultations, or

                    (c)  For treatment rendered to a Covered Person during any
                         confinement which began before this section became
                         applicable to the Covered Person.

          (H)  In-Hospital Consultation Expenses

               If Consultation Services, as described below, are rendered to a
               Covered Person by a Physician in connection with diagnosis or
               treatment of a disease or Injury, the Plan will pay a Benefit
               equal to 100% of the Reasonable Charge by the Physician for the
               services.

               (1)  Consultation Services--Consultations by a Physician, at the
                    ---------------------                                      
                    request of the Physician who is treating the Covered Person
                    while the Covered Person is confined as an inpatient in a
                    Hospital. A "consultation" means a review of the Covered
                    Person's medical history and the results of x-rays and
                    laboratory examinations, an examination of the Covered
                    Person and a written report by the consulting Physician if
                    requested by the Physician treating the Covered Person.

               (2)  Limitations.  No Benefit will be payable for
                    -----------                                 

                    (a)  Any staff consultation required by Hospital rules or
                         regulations.

                    (b)  Any consultation in connection with dental work or
                         treatment, routine eye examinations or the fitting of
                         glasses.

                    (c)  Any consultation during a period of Hospital
                         confinement that began before this section became
                         applicable to the Covered Person.

                                       15
<PAGE>
 
          (I)  Emergency Medical Physician Expenses

               If any emergency medical service is rendered to a Covered Person
               by a Physician for the initial treatment of any medical emergency
               or Injury, and if no other Benefit is payable for the service
               under this Plan (excluding Benefits payable under any Major
               Medical Expenses section), the Plan will pay a Benefit equal to
               100% of the Reasonable Charge by the Physician for the service.

               (1)  Limitations.  No Benefit will be payable
                    -----------                             

                    (a)  In connection with Surgical Services, whether or not
                         Benefits are payable under this Plan, or for treatments
                         rendered on or after the date the Surgical Service is
                         provided by Physicians who performed the procedure.

                    (b)  For dental work or treatment, eye examinations or
                         fitting of glasses, diagnostic x-rays, drugs or
                         medicines.

                    (c)  For services rendered while the Covered Person is
                         confined to a Hospital as an inpatient.

                    (d)  For services rendered more than 96 hours following the
                         onset of the medical emergency.

                    (e)  For services rendered more than 96 hours following the
                         accident which causes an injury.

    3.5.  Covered Medical Expenses - Major Medical Expenses Associated with
          Injury or Disease.

          Covered Medical Expenses under this Section 3.5 shall mean the
          following Reasonable Charges, as specified below, for treatment of an
          Injury or disease Incurred for a Covered Person while that person is
          Covered under the Plan.

          If Covered Medical Expenses, in excess of Benefits payable for such
          expenses under any other section of this Plan, are Incurred (i) during
          a calendar year and (ii) for treatment of a Covered Person, the Plan
          will pay a Benefit equal to the 100% of the Reasonable Charge of the
          excess, unless a different level of Benefits is provided for specified
          expenses in Covered Medical 

                                       16
<PAGE>
 
          Expenses or Limitations. However, not more than the 100% of the
          Reasonable Charge is payable for all expenses as to a Covered Person
          during his lifetime regardless of any interruption in coverage.

          Benefits payable under this Section are subject to the Lifetime
          Maximum Benefit Amount provisions of Section 3.3.

          (A)  Hospital Expenses

               The Board and Room Charges a Hospital makes in its own behalf for
               days of confinement in excess of 365 days during a Period of
               Hospital Confinement and other Hospital services. Hospital
               expenses exclude charges which exceed the daily Board and Room
               Charge for each day of confinement for which charges are made.

          (B)  Convalescent Facility Expenses

               The Reasonable Charges a Convalescent Facility makes in its own
               behalf for the following Necessary services and supplies
               furnished by the facility to a Covered Person while the Covered
               Person is confined in the facility, after the 30th day of a
               particular convalescence from the disease or Injury causing the
               confinement.

               (1)  Board and Room Charges exclude, however, any charge which
                    exceeds the daily Board and Room Charge for each day of
                    confinement for which charges are made.

               (2)  Use of special treatment rooms.

               (3)  X-ray and laboratory examinations.

               (4)  Physical, occupational and speech therapy.

               (5)  Oxygen and other gas therapy.

               (6)  Other medical services customarily provided by Convalescent
                    Facilities, but not private duty or special nursing
                    services, or Physicians' services.

               (7)  Medical Supplies.

               Convalescent Facility Expenses will not be included as Covered
               Medical Expenses if they are Incurred in connection with care for
               (i) Substance 

                                       17
<PAGE>
 
               Dependency; (ii) Chronic brain syndrome; (iii) Mental
               retardation; (iv) Senile deterioration; or (v) Mental Health
               Problems.

          (C)  Freestanding Surgical Expenses.

               Reasonable Charges for an approved Freestanding Surgical
               Facility.

          (D)  Home Health Care Expenses

               The Reasonable Charges made by a Home Health Care Agency for the
               following services and supplies furnished to a Covered Person in
               the Covered Person's home in accordance with a Home Health Care
               Plan.

               (1)  Part-time or intermittent nursing care by a registered
                    graduate nurse (R.N.) or by a licensed practical nurse
                    (L.P.N.), if the services of a registered graduate nurse
                    (R.N.) are not available.

               (2)  Part-time or intermittent home health aide services which
                    consist primarily of caring for the Covered Person.

               (3)  Physical therapy, occupational therapy, and speech therapy.

               (4)  Medical supplies, drugs and medicines prescribed by a
                    Physician, and laboratory services provided by or on behalf
                    of a Home Health Care Agency, but only to the extent that
                    such charges would have been covered under this policy if
                    the Covered Person had been confined in a Hospital or
                    Convalescent Facility.

               The maximum number of home health care visits to a Covered
               Person's home that will be covered in any one calendar year is
               120 visits. Each visit by a registered graduate nurse (R.N.) or
               licensed practical nurse (L.P.N.) to provide nursing care, by a
               therapist to provide physical, occupational, or speech therapy,
               and each visit of up to 4 hours by a home health aide, will be
               considered as one visit.

               Home Health Care Expenses will not be included as Covered Medical
               Expenses if they are Incurred in connection with any of the
               following:

                                       18
<PAGE>
 
               (1)  Services or supplies not specified in the Home Health Care
                    Plan, or if specified, furnished while the Covered Person is
                    not under the continuing care of a Physician.

               (2)  Services of a person who ordinarily resides in the Executive
                    or Retiree's home or is a member of the family of either the
                    Executive or Retiree's wife or husband.

               (3)  Services of any social worker.

               (4)  Transportation services.

               (5)  Custodial care.

          (E)  Hospice Care Expenses

               The Reasonable Charges made for the following furnished to a
               Covered Person for Hospice Care when given as a part of a Hospice
               Care Program:

               (1)  Facility Expenses--The Reasonable Charges made in its own
                    -----------------                                        
                    behalf by a Hospice Facility, Hospital, or Convalescent
                    Facility which are for Board and Room Charges and other
                    services and supplies furnished to a Covered Person while a
                    full-time inpatient for (a) pain control; and (b) other
                    acute and chronic symptom management.

                    Benefits for Board and Room Charges shall be payable at the
                    private or semi-private room rate used by the Hospice
                    Facility, as approved by the Claims Administrator.

               (2)  Other Expenses--Reasonable Charges made by a Hospice Care
                    --------------                                           
                    Agency for:

                    (a)  Part-time or intermittent nursing care by a registered
                         nurse (R.N.) or licensed practical nurse (L.P.N.) for
                         up to 8 hours in any one day.

                    (b)  Medical social services under the direction of a
                         Physician, which include:
                                   
                         (i)   assessment of the Covered Person's social,
                               emotional and medical needs, and the home and
                               family situation;

                                       19
<PAGE>
 
                         (ii)  identification of the community resources which
                               are available to the Covered Person; and

                         (iii) assisting the Covered Person to obtain those
                               resources needed to meet the  Covered Person's
                               assessed needs.

                    (c)  Psychological and dietary counseling.

                    (d)  Consultation or case management services by a
                         Physician.

                    (e)  Physical and occupational therapy.

                    (f)  Part-time or intermittent home health aide services,
                         for up to 8 hours in any one day, which consist mainly
                         of caring for the Covered Person.

                    (g)  Medical supplies, drugs, and medicines prescribed by a
                         Physician.

               (3)  Reasonable Charges made by the Health Care Providers below,
                    but only if the Health Care Provider is not an employee of a
                    Hospice Care Agency and such Agency retains responsibility
                    for the care of the Covered Person.

                    (a)  A Physician for consultant or case management services.

                    (b)  A physical or occupational therapist.

                    (c)  A Home Health Care Agency for:

                         (i)   physical or occupational therapy;

                         (ii)  part-time or intermittent home health aide
                               services, for up to 8 hours in any one day, which
                               consist mainly of caring for the Covered Person;

                         (iii) medical supplies, drugs and medicines prescribed
                               by a Physician; or

                         (iv)  psychological and dietary counseling.

                                       20
<PAGE>
 
               (4)  Limitations--Hospice Care Expenses exclude charges for:
                    -----------                                            

                    (a)  bereavement counseling;

                    (b)  funeral arrangements;

                    (c)  pastoral counseling;

                    (d)  financial or legal counseling (including estate
                         planning or the drafting of will);

                    (e)  homemaker or caretaker services, which are not solely
                         related to care of the Covered Person, including:

                         (i)   sitter or companion services for either the
                               Covered Person who is ill or other members of the
                               Covered Person's family;

                         (ii)  transportation;

                         (iii) housecleaning; and

                         (iv)  maintenance of the house;

                      (f) respite care, which is care furnished during a period
                          of time when the Covered Person's family or usual
                          caretaker cannot, or will not, attend to Covered
                          Person's needs.

          (F)  Dental Expenses Related to Accidents

               Reasonable Charges for dental expenses or oral surgery performed
               by a Physician or legally qualified dentist, subject to the
               limitations of Section 3.9(A)(1)(c), and required for prompt
               repair of natural teeth, otherwise in good repair, or of other
               dental tissue damaged in an accident.

          (G)  Certain Medical Expenses Related to Accidents

               Reasonable Charges for non-surgical medical expenses incurred in
               connection with Surgical Services considered as cosmetic surgery,
               when such Surgical Services are required for prompt repair of an
               Injury resulting from an accident.

    3.6.  Covered Medical Expenses - Major Medical Expenses Not Associated with
          Injury or Disease.

          Covered Medical Expenses under this Section 3.6 shall mean the
          following Reasonable Charges, as specified 

                                       21
<PAGE>
 
          below, Incurred for a Covered Person while that person is Covered
          under the Plan, even though the charges are not incurred in connection
          with an Injury or disease:

          Benefits payable under this section are subject to the Lifetime
          Maximum Benefit Amount provisions of Section 3.3.

          (A)  Physical Exam Expenses

               Reasonable Charges made by a Physician for a routine physical
               examination to a Covered Person who is an Executive or Retiree,
               an Executive or Retiree's Dependent Spouse, or Dependent Child. A
               routine physical examination is a medical examination given by a
               Physician for a reason other than to diagnose or treat a
               suspected or identified Injury or disease. X-rays, laboratory and
               other tests given in connection with the examination are included
               as part of the examination.

               (1)  A Physician's physical examination for a Dependent Child
                    must include at least:

                    (a)  a review and written record of the Dependent Child's
                         complete medical history;

                    (b)  a check of all body systems; and

                    (c)  a review and discussion of the examination results with
                         the Dependent Child or with the parent or guardian.

                    A physical examination may also include the materials for
                    and the administration of immunizations for infectious
                    disease and testing for tuberculosis.

                    Covered Medical Expenses for all physical examinations given
                    to Dependent Child under age 6 will not include charges for:

                    (a)  more than six examinations in the first year of the
                         Dependent Child's life.

                    (b)  more than one examination in each following year of the
                         Dependent Child's life.

                                       22
<PAGE>
 
               (2)  No more than $750.00 will be paid for all physical
                    examinations given to an Executive or Retiree, an Executive
                    or Retiree's Dependent Spouse or an Executive or Retiree's
                    Dependent Child in a calendar year.

               (3)  Limitations.  No Benefit will be payable for:
                    -----------                                  

                    (a)  services which are Covered to any extent under any
                         other section of this Plan; or under any other group
                         plan sponsored by the Company;

                    (b)  services which are for diagnosis or treatment of a
                         suspected or identified Injury or disease;

                    (c)  examinations given while the Covered Person is confined
                         in a Hospital or other facility for medical care;

                    (d)  services not performed by a Physician or under his
                         direct supervision;

                    (e)  medicines, drugs, appliances, equipment or supplies;

                    (f)  psychiatric, psychological, personality or emotional
                         testing or examinations;

                    (g)  examinations in any way related to employment;

                    (h)  premarital examinations;

                    (i)  hearing or dental examinations; or

                    (j)  a Physician's office visit in connection with
                         immunizations or testing for tuberculosis, unless
                         provided under (1) above.

          (B)  Mental Health Problem Expenses

               (1)  Seventy five percent of the Reasonable Charges for
                    psychiatric care rendered by a Physician for Treatment of a
                    Mental Health Problem where the Covered Person is not
                    confined in a Hospital or other facility.

                                       23
<PAGE>
 
               (2)  Seventy five percent of Reasonable Charges for drugs
                    prescribed by a Physician for Treatment of a Mental Health
                    Problem.

          (C)  Other Medical Expenses

               Any of the following Reasonable Charges which have not been
               included under any other category of medical expenses described
               in this section:

               (1)  Reasonable Charges made by a Physician for visits to a
                    Covered Person in a Hospital which occur more than 365 days
                    after the beginning of period of Hospital Confinement or to
                    a Covered Person in a Convalescent Facility after 30 days.

               (2)  Reasonable Charges for treatment by a Physician where a
                    Covered Person is not confined in a Hospital or Convalescent
                    Facility, or treatment rendered more than ninety six hours
                    after an Injury or medical emergency occurs.

               (3)  Reasonable Charges for skilled nursing care as required by a
                    Physician made by a registered nurse (R.N.), licensed
                    practical nurse (L.P.N.) under the supervision of an R.N. or
                    nursing agency, other than an R.N., L.P.N. or employee of a
                    nursing agency related to the Executive or the Executive's
                    Dependents. As used here, "skilled nursing care" means these
                    services:

                    (a)  Visiting nursing care by an R.N. or L.P.N. Visiting
                         nursing care means a visit of not more than 2 hours for
                         the purpose of performing specific skilled nursing
                         tasks.

                    (b)  Private duty nursing by an R.N. or L.P.N. if the
                         Covered Person's Physician has authorized private duty
                         nursing or skilled nursing services due to the Covered
                         Person's condition, visiting nursing care is not
                         adequate, and private duty nursing is Necessary.

                                       24
<PAGE>
 
                    "Skilled nursing care" does not include:

                    (a)  that part or all of any nursing care that does not
                         require the skills of an R.N.; and

                    (b)  any nursing care, given while the Covered Person is an
                         inpatient in a health care facility, that could safely
                         and adequately be furnished by the facility's general
                         nursing staff if it were fully staffed.

               (4)  Reasonable Charges for post operative office visits with a
                    Physician who provided Surgical Services, where the visits
                    occur more than 14 days after the surgical procedure or the
                    period of Hospital Confinement during which the procedure
                    was performed, whichever is later.

               (5)  Reasonable Charges for:

                    (a)  Drugs and medicines which by law require a Physician's
                         prescription or which do not require a Physician's
                         prescription but are ordered by a Physician.

                    (b)  Diagnostic x-ray and laboratory examinations while a
                         Covered Person is not confined in a Hospital, including
                         associated Physician's charges, but excluding those
                         examinations performed in connection with routine
                         physical examinations and dental x-rays.

                    (c)  X-ray, radium and radioactive isotopes therapy.

                    (d)  Anesthesia and oxygen.

                    (e)  Rental or purchase of Durable Medical  Equipment.

                    (f)  Initial external breast prostheses, the initial bra
                         designed exclusively for use with the prostheses, or
                         the charges for internal prostheses, which are
                         Necessary following the mastectomy; artificial limbs
                         and eyes, but not orthopedic shoes or other supportive
                         devices for the feet.

                                       25
<PAGE>
 
                    (g)  A hearing aid when first acquired following inner ear
                         surgery or when required to correct an impairment
                         caused by a Non-occupational Injury; except that

                         (i)   charges for hearing aids obtained more than one
                               year following the surgery or Injury will not be
                               considered Covered Medical Expenses, and

                         (ii)  Covered Medical Expenses for eyeglass-type
                               hearing aids will be limited to charges for a
                               comparable device of standard design.

                    (h)  Initial set of eyeglasses and/or contact lenses
                         Incurred as a result of cataract surgery when
                         prescribed by the attending Physician.

    3.7.  Treatment of Substance Dependency.

          Benefits payable under this Section are subject to the Lifetime
          Maximum Benefit Amount provisions of Section 3.3.

          (A)  Inpatient Confinement Expenses

               (1)  General.
                    ------- 

                    These provisions concerning inpatient confinement for
                    Effective Treatment of Substance Dependency apply only to
                    confinements resulting from diagnosis or recommendation by a
                    Physician and only to Reasonable Charges for expenses to the
                    extent that they are for treatment recognized by the medical
                    profession as appropriate methods of Effective Treatment of
                    Substance Dependency in accordance with broadly accepted
                    standards of medical practice, taking into account the
                    current condition of the Covered Person. For the purposes of
                    this section, a full-time confinement in a Treatment
                    Facility will be considered a Hospital Confinement, but only
                    to the extent Covered by (3) and while Benefits are payable
                    for the confinement under this section.

                                       26
<PAGE>
 
               (2)  Inpatient Hospital Expenses
                    ---------------------------

                    If a Covered Person is confined as an inpatient in a
                    Hospital solely for treatment of the medical complications
                    of Substance Dependency (such as cirrhosis of the liver,
                    delirium tremens or hepatitis), or if, for Effective
                    Treatment of Substance Dependency, a Covered Person is
                    confined as an inpatient in a Hospital that does not have a
                    section which is a Treatment Facility, any such confinement
                    is Covered for Hospital Expenses to the same extent as any
                    other disease Covered under Section 3.4(A).

               (3)  Inpatient Treatment Facility Expenses
                    -------------------------------------

                    Confinement as a full-time inpatient in a Treatment Facility
                    approved by the Claims Administrator for Effective Treatment
                    of Substance Dependency will also be Covered as any other
                    disease or Injury under Section 3.4(A). Confinement for
                    Effective Treatment of Substance Dependency in a Treatment
                    Facility will be Covered under this Plan only as provided in
                    this Section.

               (4)  The Plan will pay a Benefit of 100% of the Reasonable Charge
                    of conjoint therapy or family consultations when Necessary
                    for the Effective Treatment of Substance Dependency, if the
                    therapy occurs while the Covered Person is confined in a
                    Hospital or Treatment Facility for which Benefits are
                    payable under this subsection (A), or while enrolled in a
                    day care or night care program for which Benefits are
                    payable for partial confinement under subsection (B).

          (B)  Outpatient Expenses

               (1)  General
                    -------

                    These provisions apply only to Effective Treatment of
                    Substance Dependency resulting from diagnosis or
                    recommendation by a Physician and only to expenses for
                    Reasonable Charges to the extent that they are recognized by
                    the medical profession as appropriate methods of Effective
                    Treatment of Substance Dependency in accordance with broadly
                    accepted standards of medical

                                       27
<PAGE>
 
                    practice, taking into account the current condition of the
                    Covered Person.

               (2)  Outpatient Expenses--If, for Effective Treatment of
                    -------------------                                
                    Substance Dependency (including group, family or individual
                    counseling), expenses are incurred by a Covered Person for
                    Reasonable Charges for services and supplies made by a
                    Hospital or Treatment Facility, while the Covered Person is
                    partially confined or is not confined in a Hospital or
                    Treatment Facility, the following expenses, subject to the
                    limitations of (3) below, will be deemed to be Covered
                    Medical Expenses payable at 100% of Reasonable Charges:

                    (a)  Hospital Charges for day or night care programs while
                         the Covered Person is partially confined;

                    (b)  Non-Hospital Treatment Facility charges for day or
                         night care programs, if determined to be Necessary by
                         the Claims Administrator, while the Covered Person is
                         partially confined;

                    (c)  Physician's charges directly relating to a program of
                         Effective Treatment for Substance Dependency while the
                         Covered Person is partially confined;

                    (d)  Hospital or Treatment Facility charges for

                         (i)   services of a Physician, psychologist, nurse,
                               certified addictions counselor and trained staff
                               services;

                         (ii)  rehabilitation therapy and counseling;

                         (iii) family counseling and intervention;

                         (iv)  psychiatric, psychological and medical laboratory
                               tests;

                         (v)   drugs and medicines; and

                         (vi)  equipment use and supplies while the Covered
                               Person is an outpatient.

                                       28
<PAGE>
 
    3.8.  Limitations and Exclusions-General.

          Covered Medical Expenses shall not include charges for or related to
          any of the following:

          (A)  Charges for services or supplies not deemed Necessary.

          (B)  Charges for services or supplies which any school system is
               required to provide under any law.

          (C)  Charges for care, treatment, services or supplies that are not
               prescribed, recommended, and approved by the Covered Person's
               attending Physician or dentist.

          (D)  Charges for procedures, services, drugs and other supplies that
               are, as determined by the Claims Administrator, experimental or
               still under clinical investigation by health professionals.

          (E)  Charges for services of a resident Physician or intern rendered
               in that capacity.

          (F)  Charges that the Claims Administrator determines are not
               Reasonable.

          (G)  Charges that are made only because there is insurance.

          (H)  Charges that a Covered Person is not legally obliged to pay.

          (I)  Charges that the Claims Administrator determines are for
               Custodial Care.

          (J)  Charges for services and supplies furnished, paid for, or for
               which Benefits are provided or required by reason of the past or
               present service of any individual in the armed forces of a
               government or under any law of a government, including workers'
               compensation laws. This does not include a plan established by a
               government for its own employees or their dependents or Medicaid.

          (K)  Charges for or related to eye surgery mainly to correct
               refractive errors.

          (L)  Charges for education, special education, or job training whether
               or not given in a facility that also provides medical or
               psychiatric treatment.

                                       29
<PAGE>
 
          (M)  Charges for plastic surgery, reconstructive surgery, cosmetic
               surgery, or other services and supplies which improve, alter, or
               enhance appearance, whether or not for psychological or emotional
               reasons, except to the extent needed to:

               (1)  Improve the function of a part of the body that is not a
                    tooth or structure that supports the teeth.

               (2)  Improve the function of a part of the body that is malformed
                    as the result of a severe birth defect (including harelip or
                    webbed fingers or toes) or as a direct result of disease or
                    surgery performed to treat the disease or Injury.

               (3)  Repair an Injury which occurs while the Covered Person is
                    Covered under this policy. Surgery must be performed in the
                    calendar year of the accident which causes the Injury or in
                    the next calendar year.

          (N)  Charges that are for therapy, supplies or counseling for sexual
               dysfunction or inadequacies.

          (O)  Charges for or related to sex change surgery or any treatment of
               gender identity disorders.

          (P)  Charges for or related to artificial insemination, in-vitro
               fertilization, GIFT, or embryo transfer procedures, or for or
               related to the pregnancy of a surrogate mother.

          (Q)  Charges for the reversal of a sterilization procedure.

          (R)  Charges as an inpatient for a vasectomy.

          (S)  Charges for routine dental exams, hearing exams, immunizations,
               or other preventive services and supplies.

          (T)  Charges for or in connection with marriage, family, child,
               career, social adjustment, pastoral, of financial counseling
               services.

          (U)  Charges for or related to the treatment of obesity or for diet or
               weight control which have not been approved by the Claims
               Administrator.

                                       30
<PAGE>
 
          (V)  Charges for Treatment of a Mental Health Problem through (1)
               primal therapy; (2) Rolfing; (3) psychodrama; (4) megavitamin
               therapy; (5) bioenergetic therapy; (6) vision perception
               training; (7) carbon monoxide therapy; or related therapies or
               treatment.

          (W)  Charges for acupuncture therapy, except acupuncture performed by
               a Physician and used as a anesthesia in connection with surgery
               that is covered under this Plan.

          (X)  Charges for or in connection with speech therapy, except speech
               therapy that is expected to restore speech to a Covered Person
               who has lost an existing speech function (the ability to express
               thoughts, speak words, and form sentences) as the result of a
               disease or Injury.

          (Y)  Charges for organ and tissue transplants except as follows:

               (1)  Surgical procedures performed for the purposes of
                    transplanting a heart, lung, kidney, cornea or liver or for
                    transplanting bone marrow in the treatment of leukemia.
                    However, if the procedure relates to a liver transplant, the
                    Claims Administrator must first determine whether the
                    procedure is Necessary based on the Covered Person's medical
                    condition.

               (2)  If a surgical procedure is performed on a Covered Person to
                    transplant a body organ or tissue to another individual due
                    to the disease or Injury of that individual, the hospital,
                    surgical and medical expenses of the Covered Person will be
                    considered Covered Medical Expenses as if incurred for
                    treatment of the donor for a disease or Injury.

               (3)  If a surgical procedure is performed on a Covered Person to
                    treat the Covered Person's disease or Injury by
                    transplanting a body organ or tissue from a living person
                    who is not a Covered Person

                    a.   the Hospital, surgical and medical expenses of the
                         donor will not be considered Covered Medical Expenses,

                                       31
<PAGE>
 
                    b.   the Hospital, surgical and medical expenses of the
                         Covered Person will be considered Covered Medical
                         Expenses.

               No benefits are payable for:

               (1)  Expenses Incurred by the donor or recipient of an organ or
                    tissue transplant who is not a Covered Person if that person
                    is Covered under another plan of group medical Coverage.

               (2)  Expenses incurred for transplants which are not Necessary.

          Any general exclusion or limitation will not apply if Coverage is
          specifically provided by name in a separate provision or section of
          this Plan or Coverage of the charge is required under any law that
          applies to the Coverage.

          Before determining Benefits under any section, the amount related to
          the preceding charges will be deducted from the Covered Person who is
          Covered under that section and, if this Plan contains a Coordination
          of Benefits With Other Plans, the amount of the preceding charges will
          not be included as Allowable Expenses.

          No Benefits are payable under this Plan to the extent that the
          provision of Benefits is prohibited by any law of the jurisdiction in
          which the Covered Person resides at the time claim is incurred.

    3.9.  Limitations and Exclusions - Major Medical Expenses. The following
          limitations and exclusions shall apply in determining Covered Medical
          Expenses for those services or charges listed in this Section 3.9.

          (A)  Mouth, Jaws and Teeth

               (1)  Limitations.  Covered Medical Expenses include only those
                    -----------                                              
                    services rendered and supplies needed for the following
                    treatment of or related to conditions of the teeth, mouth,
                    jaws, jaw joints, or supporting tissues (including bones,
                    muscles, and nerves). For these expenses, Physician includes
                    a dentist.

                                       32
<PAGE>
 
                     (a) Surgery needed to:

                         (i)   Treat a fracture, dislocation, or wound.

                         (ii)  Cut out:

                               -  teeth partly or completely impacted in the
                                  bone of the jaw;
                               -  teeth that will not erupt through the gum;
                               -  other teeth that cannot be removed without
                                  cutting the bone;
                               -  the roots of a tooth without removing the
                                  entire tooth; or
                               -  cysts, tumors, or other diseased tissues.

                         (iii) Cut into the gums and tissues of the mouth when
                               not done in connection with the removal or
                               repair of teeth.

                         (iv)  Alter the jaw, jaw joints, or bite relationships
                               by a cutting procedure when appliance therapy
                               alone cannot result in functional improvement.

                     (b) Non-surgical treatment of infections or diseases not of
                         or related to the teeth.

                     (c) Dental work, surgery and orthodontic treatment needed
                         to remove, repair, replace, restore, or reposition
                         natural teeth damaged, lost or removed or other body
                         tissues of the mouth fractured or cut due to Injury if:

                         (i)    The accident causing the Injury occurs while the
                                Covered Person is Covered under this section;
 
                         (ii)   Such teeth must have been free from decay or in
                                good repair and firmly attached to the jaw bone
                                at the time of the Injury;

                         (iii)  The treatment must be done in the calendar year
                                of the accident or the next one.

                                       33
<PAGE>
 
                         If crowns (caps), dentures (false teeth), bridgework,
                         or in-mouth appliances are installed due to such
                         Injury, Covered Medical Expenses include only charges
                         for:

                         (i)    the first denture or fixed bridgework to replace
                                lost teeth;

                         (ii)   the first crown needed to repair each damaged
                                tooth; and

                         (iii)  an in-mouth appliance used in the first course
                               of orthodontic treatment after the Injury.

                (2)  Exclusions.  The following are excluded from Covered
                     ----------
                     Medical Expenses:

                     (a) Charges to remove, repair, replace, restore or
                         reposition teeth lost or damaged in the course of
                         biting or chewing;

                     (b) Charges to repair, replace, or restore fillings,
                         crowns, dentures or bridgework;

                     (c) Charges for non-surgical periodontal treatment;

                     (d) Charges for in-mouth scaling, planing or scraping;

                     (e) Charges for myofunctional therapy which is muscle
                         training therapy, or training to correct or control
                         harmful habits;

                     (f) Charges for mouth appliances, crowns, bridgework,
                         dentures, tooth restorations, or any related fitting or
                         adjustment services, except as provided for Injury;
                         whether or not the purpose of such services or supplies
                         is to relieve pain;

                     (g) Charges for root canal therapy or dental cleaning;

                     (h) Charges for routine tooth removal (not needing cutting
                         of bone), except as provided for Injury.

                                       34
<PAGE>
 
           (B)  Mammographies

                Charges Incurred by a female Covered Person age 35 or over for
                one routine screening by mammography each calendar year for the
                presence of occult breast cancer, whether or not incurred in
                connection with a disease or Injury.

                                       35
<PAGE>
 
4.  COORDINATION OF THE PLAN'S BENEFITS WITH OTHER BENEFITS.

    4.1.   Applicability.

           (A)  This Coordination of Benefits ("COB") provision applies to This
                Plan when a Covered Person has health care coverage under more
                than one Plan.  "Plan" and "This Plan" are defined below.

           (B)  If this COB provision applies, the order of benefit
                determination rules should be looked at first.  Those rules
                determine whether the benefits of This Plan are determined
                before or after those of another plan.  The benefits of This
                Plan:

                (1)  shall not be reduced when, under the order of benefit
                     determination rules, This Plan determines its benefits
                     before another plan; but

                (2)  may be reduced when, under the order of benefits
                     determination rules, another plan determines its benefits
                     first.  The above reduction is described in Section 4.4
                     "Effect on the Benefits of This Plan" below.

    4.2.   Definitions.

           (A)  Calendar Year.

                The period extending from January 1 of any year to December 31
                of the same year.

           (B)  Plan.

                Any of the following plans or programs which provides benefits
                or services for, or because of, medical or dental care or
                treatment:

                (1)  Group insurance or group-type coverage, whether insured or
                     uninsured.  This includes prepayment, group practice or
                     individual practice coverage.  It also includes coverage
                     other than school accident-type coverage.

                (2)  Automobile reparations (no-fault) insurance required under
                     any law of a government and provided on other than a group
                     basis, but only to the extent of the benefits required
                     under such no-fault law.

                                       36
<PAGE>
 
                The term "Plan" will be construed separately with respect to
                each policy, contract, or other arrangement for benefits or
                services and separately with respect to that portion of any such
                policy, contract, or other arrangement which reserves the right
                to take the benefits or services of other Plans into
                consideration in determining its benefits and that portion which
                does not.

           (C)  This Plan.

                The Lyondell Petrochemical Company Executive Medical Plan as
                amended and restated effective October 1, 1990, that is set
                forth herein.

           (D)  Primary Plan/Secondary Plan.

                The order of benefit determination rules state whether This Plan
                is a Primary Plan or Secondary Plan as to another plan covering
                the person.

                When This Plan is a Primary Plan, its benefits are determined
                before those of the other plan and without considering the other
                plan's benefits.

                When This Plan is a Secondary Plan, its benefits are determined
                after those of the other plan and may be reduced because of the
                other plan's benefits.  When there are more than two plans
                covering the person, This Plan may be a Primary Plan as to one
                or more other plans, and may be a Secondary Plan as to a
                different plan or plans.

           (E)  Allowable Expense.

                The Reasonable Charge for a Necessary item of medical or dental
                expense at least partly covered under at least one of the Plans
                covering the person for whom the claim is made.

                When a plan provides benefits in the form of services, the
                reasonable cash value of each service rendered will be
                considered both an Allowable Expense and a benefit paid.

           (F)  Claim Determination Period.

                A calendar year.  However, if a person is not eligible for
                Benefits under this Plan during all of a calendar year, then the
                Claim Determination Period for the person as to that year will
                be the

                                       37
<PAGE>
 
                total period thereof during which he was eligible for Benefits.

    4.3.   Order of Benefit Determination Rules.

           (A)  General.

                When there is a basis for a claim under This Plan and another
                plan, This Plan is a Secondary Plan which has its benefits
                determined after those of the other plan, unless

                (1)  The other plan has rules coordinating its benefits with
                     those of This Plan; and

                (2)  Both those rules and This Plan's rules, in Subsection
                     4.3.(B), below, require that This Plan's benefits be
                     determined before those of the other plan.

           (B)  Rules.

                This Plan determines its order of benefits using the first of
                the following rules which applies:

                (1)  Non-Dependent/Dependent.  The benefits of the plan which
                     -----------------------                                 
                     covers the person other than as a dependent are determined
                     before those of the plan which covers the person as a
                     dependent; except that if the person is also a Medicare
                     beneficiary, and as a result of the rule established by
                     Title XVIII of the Social Security Act and implementing
                     regulations, Medicare is:

                     (a) Secondary to the plan covering the person as a
                         dependent, and

                     (b) Primary to the plan covering the person as other than a
                         dependent (e.g. a retired employee),

                     then the benefits of the plan covering the person as a
                     dependent are determined before those of the plan covering
                     that person as other than a dependent.

                (2)  Dependent Child/Parents not Separated or Divorced.  Except
                     -------------------------------------------------         
                     as stated in Paragraph (B)(3) below, when This Plan and
                     another plan cover the same child as a dependent of
                     different persons, called "parents".

                                       38
<PAGE>
 
                     (a) The benefits of the plan of the parent whose birthday
                         falls earlier in a year are determined before those of
                         the plan of the parent whose birthday falls later in
                         that year; but

                     (b) If both parents have the same birthday, the benefits of
                         the plan which covered one parent longer are determined
                         before those of the plan which covered the other parent
                         for a shorter period of time.

                         However, if the other plan does not have the rule
                         described in (a) immediately above, the rule in the
                         other plan will determine the order of benefits.

                (3)  Dependent Child/Parents Separated or Divorced.  Except as
                     ---------------------------------------------            
                     otherwise required under the terms of a valid qualified
                     medical child support order ("QMCSO"), if two or more plans
                     cover a person as a dependent child of divorced or
                     separated parents, benefits for the child are determined in
                     this order:

                     (a) First, the plan of the parent with custody of the
                         child;

                     (b) Then, the plan of the Spouse of the parent with the
                         custody of the child; and

                     (c) Finally, the plan of the parent not having custody of
                         the child.

                     However, if the specific terms of a valid QMCSO state that
                     one of the parents is responsible for the health care
                     expense of the child, and the entity obligated to pay or
                     provide the benefits of the plan of that parent has actual
                     knowledge of those terms, the benefits of that plan are
                     determined first.  The plan of the other parent shall be
                     the Secondary Plan.  This paragraph does not apply with
                     respect to any Claim Determination Period or Plan Year
                     during which any benefits are actually paid or provided
                     before the entity has that actual knowledge.

                (4)  Active/Inactive Employee.  The benefits of a plan which
                     ------------------------                               
                     covers a person as an employee who is neither laid off nor
                     retired or a dependent of such Person are determined

                                       39
<PAGE>
 
                     before those of a plan which covers that person as a laid
                     off or retired employee or a dependent of such person.  If
                     the other plan does not have this rule, and if, as a
                     result, the plans do not agree on the order of benefits,
                     this Section 4.3(B)(4) is ignored.

                (5)  If none of the above applies, the Plan under which the
                     person has been covered the longest will be deemed to pay
                     its benefits first except in the case shown below.

                (6)  Continuation Coverage.  If a person whose coverage is
                     ---------------------                                
                     provided under a right of continuation pursuant to federal
                     or state law also is covered under another plan, the
                     following shall be the order of benefit determination:

                     (a) First, the benefits of a plan covering the person as an
                         employee, member or subscriber (or as that person's
                         dependent);

                     (b) Second, the benefits under the continuation coverage.
                         If the other plan does not have the rule described
                         above, and if, as a result, the plans do not agree on
                         the order of benefits, this Section 4.3(B)(5) is
                         ignored.

    4.4.   Effect on the Benefits of this Plan.

           (A)  When This Section Applies.

                This Section 4.4 applies when, in accordance with Section 4.3,
                this Plan is a Secondary Plan as to one or more other plans.  In
                that event, the benefits of This Plan may be reduced under this
                section.  Such other plan or plans are referred to as "the other
                plans" immediately below.

           (B)  Reduction in This Plan's Benefits.

                The benefits of This Plan will be reduced when the sum of:

                (1)  The benefits that would be payable for the Allowable
                     Expense under This Plan in the absence of this COB
                     provision; and

                                       40
<PAGE>
 
                (2)  The benefits that would be payable for the Allowable
                     Expenses under the other plans, in the absence of
                     provisions with a purpose like that of this COB provision,
                     whether or not claim is made; exceeds those Allowable
                     Expenses in a Claim Determination Period.  In that case,
                     the benefits of This Plan will be reduced so that they and
                     the benefits payable under the other plans do not total
                     more than those Allowable Expenses.

                When the total amount of benefits of This Plan are reduced as
                described above, each benefit is reduced in proportion and the
                reduced amount charged against any applicable benefit limit of
                This Plan.

    4.5.   Right to Receive and Release Needed Information.  Certain facts are
           needed to apply these COB rules.  The Claims Administrator has the
           right to decide which facts it needs.  It may get needed facts from
           or give them to any other organization or person.  The Claims
           Administrator need not tell, or get the consent of, any person to
           this.  Each person claiming Benefits under This Plan must give the
           Claims Administrator any facts it needs to pay the claim.

    4.6.   Facility of Payment.  A payment made under another plan may include
           an amount which should have been paid under This Plan.  If it does,
           the Claims Administrator, in its sole discretion, may pay that amount
           to the organization which made that payment.  That amount will then
           be treated as though it were a benefit paid under This Plan.  The
           Claims Administrator will not have to pay that amount again.

    4.7.   Right of Recovery.  If the amount of the payments made by the Claims
           Administrator is more than it should have paid under this COB
           provision, it may recover the excess from one or more of:

           (A)  The persons it has paid or for whom it has paid;

           (B)  Insurance companies; or

           (C)  Other organizations.

           The "amount of the payments made" includes the reasonable cash value
           of any benefits provided in the form of services.  Such right of
           recovery does not affect any other right of recovery this Plan may
           have with respect to such overpayment.

                                       41
<PAGE>
 
    4.8.   Multiple Coverage Under This Plan. If a Covered Person is covered
           under this Plan both as an Executive and a Dependent, or as a
           Dependent of 2 Executives, the following will also apply to this
           provision:

           (A)  The person's coverage in each capacity under this plan will be
                established separately as a "Plan".

           (B)  The Order of Benefit Determine Rules will be applied to the
                "Plans" established above as well as to all other Plans.

           (C)  This provision will not apply more than once to determine the
                total benefits payable to the Covered Person for each claim
                under this Plan.

    4.9.   Special Provisions Applicable to Persons Eligible for Medicare

           (A)  Applicability

                These provisions will not apply and Medicare will not have any
                effect on Benefits payable under this Plan at any time when the
                Company's compliance with federal law requires Benefits to be
                determined under this Plan for a Covered Person before Medicare
                determines its benefits.

           (B)  Regular Expenses Calculation

                The amount of Covered Medical Expenses under Regular Expenses as
                to a Covered Person will be the excess of 1 over 2.  No Benefit
                will be payable if 1 does not exceed 2.

                1.   The Benefits that would be payable as Regular Expenses, as
                     if no charge to which the Coverage applies were covered
                     under Medicare.

                2.   The Benefits provided under Medicare as to those charges to
                     which are covered as Regular Expenses.  A separate
                     determination of Medicare benefits, by Coverage, will be
                     made as in 1.  Benefits provided by Medicare will be taken
                     into account if the Covered Person is eligible for
                     Medicare, whether or not the Covered Person is entitled to
                     Medicare benefits.

                A benefit calculation, as described above, will be made as to
                each claim for Benefits.  No recalculation of Benefits will be
                made as to

                                       42
<PAGE>
 
                charges included in a prior claim for, or prior calculation of,
                Benefits.

                Any Benefits payable, as calculated above, and the Benefits
                referred to in 1. above, will be determined before the terms
                under the Coordination of the Plan's Benefits section are
                applied.

                The provisions of (B) and (C) shall not be applied if the
                Covered Person is an Executive age 65 or over or if the Covered
                Person is eligible for Medicare due to disability, and Covered
                Medical Expenses under the Plan shall be calculated without
                reduction for Medicare.

           (C)  Major Medical Expenses Calculation

                Covered Medical Expenses under Major Medical Expenses Coverage
                will be reduced before any coinsurance percentage is applied, by
                any benefits provided under Medicare as to charges to which both
                Medicare and Major Medical Expenses Coverage pertain.  Benefits
                provided by Medicare will be taken into account while the
                Covered Person is eligible for any Medicare coverage, whether or
                not the Covered Person is entitled to Medicare benefits.

                As to Medicare, the terms of this section will apply instead of
                any governmental benefit exclusion.

           (D)  Medicare Benefits

                In determining benefits provided under Medicare, any deductible
                that applies to charges made by various providers of care will
                be applied against charges to which this Plan's Coverage
                pertains in the order the charges are received.

                If a benefit claim includes more than one charge, any remaining
                Medicare deductible will he applied to charges of the various
                providers of services, starting with the largest charge, then
                the next largest, etc.

                If benefits provided by Medicare for a charge to which this
                Plan's Coverage pertains cannot be determined from the above
                rules, then reasonable estimates of the amount of the benefits
                will be made, on a non-discriminatory basis, and will be used to
                determine any Benefits under this Plan.

                                       43
<PAGE>
 
5.  TERMINATION OF COVERAGE.

    If all or any part of an Executive's or Retiree's Coverage terminates, then
    the corresponding Coverage for his Dependents, if any, shall terminate
    simultaneously, subject to the provisions below under the heading
    "Continuation of Coverage" under certain circumstances.

    5.1.   Executives.  An Executive's Coverage shall terminate on the earliest
           to occur of the following:

           (A)  The last day of the month in which the Executive terminates
                employment, for a reason other than a disability retirement;

           (B)  The date of the Executive's death;

           (C)  The last day of the month in which the Employee transfers to a
                position with the Company that is not on the executive payroll;
                or

           (D)  The effective date of termination of the Plan.

    5.2.   Dependents.  Subject to the provisions below for Handicapped
           Dependent Children and totally disabled Dependents, Coverage for a
           Covered Dependent shall terminate on the earliest to occur of the
           following:

           (A)  The date on which the Employee's or Retiree's Coverage
                terminates, but if Coverage terminates due to the Executive's or
                Retiree's death, the last day of the month in which her death
                occurs;

           (B)  The last day of the month in which the individual ceases to be a
                Dependent; or, if earlier, when the individual, if a Dependent
                Child, becomes an Executive;

           (C)  The date of the Dependent's death; or

           (D)  If the Dependent is Totally Disabled on the date on which
                Coverage would otherwise terminate under this subsection,

                (1)  Coverage for Regular Expenses (except Emergency Medical
                     Care) incurred while the Dependent remains Totally Disabled
                     will be continued for three months after the date Coverage
                     would have otherwise terminated.

                     However, Coverage for Hospital or Convalescent Facility
                     confinements beyond

                                       44
<PAGE>
 
                     this three month period will be continued (a) if this is a
                     Hospital Confinement, it began before the date that
                     Coverage would have otherwise terminated under this
                     subsection; and (b) if this is a Convalescent Facility
                     confinement, the Convalescent Facility Confinement and
                     previous Hospital confinement of at least three consecutive
                     days both took place before the date Coverage would have
                     otherwise terminated under this subsection.

                (2)  Coverage for services or treatment related to Major Medical
                     Expenses will be continued until the earlier of the time:

                     (a)  the disability ends:
                     (b) twelve months from the date Coverage would have
                         otherwise terminated under this subsection; or
                     (c) the Dependent became covered by another group health
                         plan which provides lesser benefits.

    5.3.   Handicapped Dependent Child.  A Handicapped Child is an Executive or
           Retiree's Child who meets the definition of Dependent under Section
           11.18(D) of the Plan and who is chiefly dependent upon the Executive
           or Retiree for support and maintenance.  The following shall apply to
           a Handicapped Child who reaches the age at which he would otherwise
           cease to be a Covered Dependent unless the Handicapped Child has been
           issued a personal medical conversion policy.  If he is then a
           Handicapped Child, the Plan shall continue to consider him as a
           Covered Dependent while he remains a Handicapped Child if the
           Executive or Retiree submits to the Claims Administrator proof of the
           Child's incapacity.  Furthermore, if a Handicapped Child was covered
           under any group health plan of the Company on the date immediately
           preceding the effective date of the Executive's Coverage, the Child
           shall be considered as a Dependent while remaining a Handicapped
           Child.

           The Claims Administrator shall have the right to require satisfactory
           proof of continuance of the incapacity of a Handicapped Child and the
           right to examine such Child, but not more than once a year after two
           years have elapsed from the date the Child reaches an age at which he
           would have otherwise ceased to be a Covered Dependent.  Upon failure
           to submit such required proof or to undergo such an examination, or
           when such Child ceases to be so incapacitated or when Dependent
           Coverage terminates for any reason other than reaching an age at

                                       45
<PAGE>
 
           which a Child would have otherwise ceased to be a Covered Dependent,
           Coverage with respect to him shall cease.  The continuance of
           Coverage shall be subject to all provisions of the Plan relating to
           termination of Coverage except as modified by this section.

           Proof that a Child is fully Handicapped must be submitted to the
           Claims Administrator no later than 31 days after the date the Child
           reaches the age at which he would otherwise cease to be a Covered
           Dependent.

    5.4.   Retiree.  Retiree Coverage terminates on the earlier of:

           (A)  The day of the Retiree's death; or

           (B)  The effective date of termination of the Plan or the amendment
                of the Plan in a manner that eliminates Coverage for a class of
                Covered Persons of which the Retiree is a member.

    5.5.   Continuation of Coverage Related to Pregnancy.  If any or all
           Coverage would otherwise terminate for a Covered Person during a
           pregnancy

           (A)  As to any applicable sections except Major Medical Expenses, any
                Benefit provided under that section for her pregnancy expenses
                will continue to be available for such expenses Incurred in
                connection with that pregnancy, but not beyond the end of a
                period of 3 months following termination of the pregnancy.

           (B)  As to any Major Medical Expenses section, any Benefit provided
                under such section for her pregnancy expenses will continue to
                be available for such expenses Incurred in connection with
                pregnancy, but not beyond the end of a period of 12 months
                following the date her Coverage terminates.

           (C)  Limitations

                No benefits will be payable if the applicable section terminates
                as to the Eligible Class of which the Executive or Retiree is a
                member.

    5.6.   Continuation of Coverage Under Certain Circumstances.  A Covered
           Person's Coverage under the Plan may be extended under the following
           circumstances:

                                       46
<PAGE>
 
           (A)  The Executive's eligibility for a qualifying FMLA Leave taken in
                accordance with applicable provisions of the Company's FMLA
                Policy, as described in Section 7 of the Plan; or eligibility
                under the Company's general leave of absence policy;

           (B)  The Covered Person's eligibility for continued Coverage pursuant
                to the requirements of COBRA;

           (C)  The Executive's eligibility for and receipt of a benefit under a
                severance plan or an early retirement plan that, by its terms,
                provides for continuation of Coverage under this Plan.

                                       47
<PAGE>
 
6.  CONTINUATION COVERAGE (COBRA).

    6.1.   Entitlement to COBRA Coverage.

           (A)  Covered as an Executive.

                If a Covered Person is covered by the Plan as an Executive or
                Retiree, he has the right to elect COBRA coverage if he loses
                Coverage because:

                (1)  If he is an Executive, his hours of employment with the
                     Company are reduced;

                (2)  If he is an Executive, his employment with the Company is
                     terminated (for reasons other than his gross misconduct);
                     or

                (3)  If he is a Retiree, certain bankruptcy proceedings commence
                     concerning the Company.

           (B)  Covered as a Dependent Spouse.

                If a Covered Person is Covered by the Plan as the Dependent
                Spouse of an Executive, he has the right to elect COBRA coverage
                for himself if he loses Coverage for any of the reasons in (A)
                above or for one of the following reasons:

                (1)  The Executive dies;

                (2)  He becomes divorced or legally separated; or

                (3)  He becomes entitled to Medicare.

           (C)  Covered as a Dependent Child.

                If a Covered Person is Covered by the Plan as a Dependent Child
                of an Executive, he has the right to elect COBRA coverage for
                himself if he loses Coverage for any of the reasons in (A) or
                (B) above, or if he ceases to be a Dependent Child eligible for
                Coverage under the Plan.

    6.2.   Types of Coverage.  A Covered Person does not have to show that he is
           insurable to elect COBRA coverage.  Each Covered Person who is
           eligible to elect COBRA coverage is entitled to make a separate
           coverage election.  Thus, a Dependent Spouse or Dependent Child may
           elect COBRA coverage even if the Covered Executive does not make that
           election.  Similarly, a Dependent Spouse or Dependent Child may elect
           coverage different from the coverage the Executive elects.

                                       48
<PAGE>
 
    6.3.   Notice of COBRA Events. Under COBRA, each Covered Executive or
           Dependent must inform the Company of a divorce, legal separation, or
           a Child's losing Dependent status under the Plan within 60 days after
           the date of such event. If notice is not received within that 60-day
           period, the Covered Person will not be entitled to elect COBRA
           coverage. If the Covered Person elects COBRA coverage, the Covered
           Person must notify the Company immediately if an event occurs that
           causes that coverage to be cut short (as described below).

           If a Covered Person elects COBRA coverage due to a employment
           termination (other than gross misconduct) or reduction in hours and
           the Social Security Administration determines that the Covered Person
           was disabled on the date of such termination or reduction in hours,
           he must notify the Claims Administrator of that fact within 60 days
           after the date of such determination and within the 18-month period
           described below.  He also must notify the Claims Administrator within
           30 days after the date he is determined to be no longer disabled.

           When the Company is notified of a divorce, legal separation, or loss
           of dependent status, or determines that one of the other events
           described in Section 6.1(A), (B), or (C) has occurred, the Company
           will notify the Covered Person of his COBRA coverage election rights.
           Notice to a parent is also notice to any Dependent Children who would
           also lose Coverage under the Plan.

           A Covered Person must notify the Company in writing if he wants to
           elect COBRA coverage within 60 days of the later of (1) the date of
           the Company's notice to him or (2) the date he would lose Coverage
           because of an event described above.  A parent can elect COBRA
           coverage on behalf of Dependent Children.

    6.4.   Duration of COBRA Coverage.  If a Covered Person does not elect COBRA
           coverage when it is offered to him, his Coverage under the Plan will
           end.  If he elects COBRA coverage, his coverage will be identical to
           the Coverage provided under the Plan to similarly situated Executives
           or Dependents, as of the time Coverage is being provided.  This means
           that if the Coverage for similarly situated Executives or Dependents
           is modified, his coverage will be modified in the same manner.  COBRA
           coverage generally will last for 36 months unless the Covered Person
                                                      ------                   
           lost Coverage because of a termination of employment (other than
           gross misconduct) or reduction in hours of employment, in which case,
           COBRA coverage will

                                       49
<PAGE>
 
           last for only 18 months.  The 18-month coverage period may be
           extended to 29 months if the Covered Person is determined to be
           disabled by the Social Security Administration at the time of the
           Executive's termination of employment or reduction in hours, provided
           that the Covered Person notifies the Company within 60 days of the
           date of such determination and within the 18-month period.

           Special rules govern the COBRA coverage period when the Covered
           Executive becomes entitled to Medicare, a Retiree or his family
           member loses Coverage because of the commencement of bankruptcy
           proceedings concerning the Company, or if certain qualifying events
           occur within 18 or 29 months of a termination or reduction in hours
           of employment.

    6.5.   Termination of COBRA Coverage.  COBRA coverage will be terminated
                                                          ----              
           (including retroactively) if:

           (A)  The Covered Person becomes covered under any other group health
                plan (as an employee or otherwise) that does not contain any
                exclusion or limitation for any preexisting condition the
                Covered Person has that is covered by the Plan;

           (B)  The Covered Person becomes entitled to Medicare benefits;

           (C)  A premium for the Covered Person's COBRA coverage is not paid
                and received within (30) days of its due date;

           (D)  The Company no longer provides any group health coverage to any
                employee; or

           (E)  Coverage was extended due to the Covered Person's disability and
                he is determined to be no longer disabled.

    6.6.   Cost of COBRA Coverage.  A Covered Person electing to continue
           Coverage under COBRA must pay to the Company on a monthly basis the
           entire amount due for such Coverage.  The amount due will be no more
           than 102 percent of the Company's cost on a group basis, except that
           Persons who qualify for an extension of continuation Coverage on the
           basis of disability will be required to pay 150 percent (instead of
           102 percent) of the Company's cost for each additional month of
           Coverage after the initial 18-month period.  The first contribution
           must cover the period from the date Coverage would otherwise have
           terminated until the end of the month in which the first

                                       50
<PAGE>
 
           contribution is made.  Subsequent contributions are due and payable
           on the first day of each month subject to a 30-day grace period
           during which grace period the contribution must be received.  The
           first contribution must be received by the Administrator no later
           than 45 days after continuation Coverage is elected.

           In the event that a monthly contribution is not timely received by
           the first day of the month or within the next 30 days, coverage under
                                                                  --------------
           the Plan will be automatically terminated without notice as of the
           --------------------------------------------------------          
           last day of the month for which a proper contribution was last
           received.

    6.7.   Conversion Health Plans.  If a Covered Person has COBRA coverage for
           the entire coverage period, he must be allowed to enroll in a
           conversion health plan if one is available to him under the Plan.

    6.8.   Questions About COBRA Coverage.  If a Covered Person has any
           questions about COBRA, he should contact the Claims Administrator.
           If a Covered Person's marital status changes, his Child loses
           Dependent status, he or his spouse change address, or other changes
           or events noted above occur, he must notify the Claims Administrator
           within the prescribed time period.

                                       51
<PAGE>
 
7.  LEAVES OF ABSENCE.

    7.1.   General.  An Executive who is granted an unpaid leave of absence
           shall be entitled to continue Coverage under this Plan if permitted
           under the Company's leave of absence policy, except as provided in
           subsection 7.2.

    7.2.   Entitlement to Coverage During Family and Medical Leave.  An
           Executive who has applied for and has been granted an FMLA Leave
           under the terms of the Company's FMLA Policy will continue to be
           eligible to participate in the Plan during the period of his FMLA
           Leave on the same conditions as would have applied if the Executive
           had not been on FMLA Leave.  An Executive may choose not to retain
           health coverage under the Plan during FMLA leave.

    7.3.   Duration of Coverage During Family and Medical Leave.  Except as
           required by COBRA, if a "key employee" who is on FMLA Leave and has
           been notified by the Company that substantial or grievous economic
           injury will result from his reinstatement does not return from FMLA
           Leave, the Executive's entitlement to group health benefits continues
           unless and until the Executive advises the Company that the Executive
           does not desire restoration to employment at the end of the leave
           period, or FMLA Leave entitlement is exhausted, or reinstatement is
           actually denied.  A "key employee" refers to an Executive who is
           among the highest paid 10 percent of employees employed within 75
           miles of his worksite and as further defined in the regulations under
           the Family and Medical Leave Act.

    7.4.   Disqualified Leave and Integration with COBRA.  If the requested
           leave of absence does not qualify as a FMLA Leave in accordance with
           the provisions of the FMLA Policy, or the Executive's coverage is not
           continued under the Company's leave of absence policy, then the
           Covered Employee and any Covered Dependents (referred to as COBRA
           "Qualified Beneficiaries") will be offered COBRA continuation
           coverage under the Plan (as described in the COBRA section of the
           Plan).

           If a Qualified Beneficiary fails to timely pay a required premium for
           COBRA coverage, the continuation coverage of such Qualified
           Beneficiary under the Plan will cease in accordance with the Plan's
           COBRA procedures. If an Executive who did not elect COBRA coverage,
           or whose COBRA coverage was terminated, should return to Active Full-
           Time Work on the Company's executive payroll, such Executive (and his
           Dependents, if any) shall be eligible to participate in the Plan on

                                       52
<PAGE>
 
           the first day of Active Full-Time Service on the Company's Executive
           payroll.

                                       53
<PAGE>
 
8.  CONVERSION PRIVILEGE.

    8.1.   General.  This section does not continue group insurance, but permits
           the issuance of an individual medical expense policy under certain
           conditions.

    8.2.   Eligibility for Conversion Privilege.  An individual policy may be
           issued, subject to the terms of this section, only in the following
           cases:

           (A)  All an Executive's Coverage under the Plan, including Coverage,
                if any, as to his Dependents, terminates because his employment
                terminates, or he ceases to be a member of the classes of
                employees then still eligible for Coverage.  This does not apply
                to any person who becomes, or is, a Retiree.

           (B)  All an Executive's Coverage, including Coverage, if any, as to
                his Dependents, terminates, or would otherwise terminate in the
                absence of any provision continuing coverage for Retirees, when
                the Executive becomes a Retiree.

           (C)  An Executive's Employee - Only Coverage under the Plan continues
                but his Dependent Coverage for an individual terminates because
                the individual ceases to be a Dependent.

           In no event will an individual policy be available if Coverage
           terminates because the Plan discontinues in its entirety or with
           respect to all Executives of the Company or as to an eligible class
           or group of which the Executive is a member.

    8.3.   Right to Convert

           The Executive in 8.2(A) and (B), the Dependent in 8.2(C), or the
           Dependent(s) of an Executive whose employment terminates because of
           death prior to retirement will have the right to obtain an individual
           policy of insurance (the "converted policy") from the Claims
           Administrator without medical evidence of insurability.  If the
           Executive is entitled to a conversion policy under 8.2(A) or (B), the
           Executive may obtain a converted policy which covers the Executive
           only or the Executive and all his Dependents who were covered under
           the Plan when the Executive's Coverage terminated.  If the
           Executive's employment terminates due to death prior to retirement, a
           converted policy may be issued to cover all the Executive's
           Dependents or the Dependent Spouse only who are Covered under the
           Plan

                                       54
<PAGE>
 
           when the Executive's Coverage terminates.  Written application for
           the converted policy must be made to the Claims Administrator within
           31 days after the date that Coverage under this Plan terminates or
           would otherwise terminate in the absence of any provision continuing
           Coverage for Retirees;

    8.4.   Restrictions

           (A)  The Claims Administrator may decline to issue a converted policy
                in any of the following instances:

                (1)  If application for the converted policy is made in a
                     jurisdiction in which the Claims Administrator is not
                     authorized to issue or deliver the policy.

                (2)  If Coverage under the Plan terminates before the Executive
                     has been Covered under them for at least 3 months.

                (3)  If any person who would be covered under the converted
                     policy is, on the conversion date, covered under (a) or (b)
                     below, covered or eligible for coverage under (c) below, or
                     for whom benefits are required or available under (d)
                     below, and such coverage provides similar benefits and
                     would, with the converted policy, result in overinsurance
                     or duplica-tion of benefits under the Claims Admin-
                     istrator's standards for converted policies last made
                     effective by the Claims Admin-istrator as to the
                     jurisdiction in which the converted policy would be
                     delivered.

                     (a)  Any other hospital or surgical expense insurance
                          policy.

                     (b)  Any hospital service or medical expense indemnity
                          corporation subscriber contract.

                     (c)  Any other group contract.

                     (d)  Any statute, welfare plan or program.

           (B)  The Claims Administrator may decline to cover an individual
                under a converted policy in either of the following instances:

                                       55
<PAGE>
 
                (1)  If Coverage for the Executive or a Dependent under the Plan
                     terminated because the person had exhausted the Lifetime
                     Maximum Benefit Amount available under the Plan.

                (2)  If the law of the jurisdiction in which the Executive or
                     Dependent resides prohibits the provision of benefits under
                     the converted policy.

    8.5.   Renewal.  The converted policy will contain a provision giving the
           Claims Administrator the right to refuse renewal under certain stated
           conditions.

    8.6.   Form of Converted Policy.  The policy's form, and its terms, will be
           of a type or types offered by the Claims Administrator under the
           Company's conversion plan for group insurance conversions at the time
           the policy is applied for.  It will have benefits at least in line
           with any law or regulation which applies.  Upon request, the Claims
           Administrator will give details as to the type of policies offered.

    8.7.   Premiums.  The first premium for the converted policy must be paid
           within 31 days after the applicable termination date of Coverage
           under this Plan.  The premium payable under the converted policy on
           its effective date will be the Claims Administrator's then customary
           rate for the insured individual's class and age, and the form and
           amount of insurance.

    8.8.   Effective Date.  The converted policy will become effective on the
           day after the applicable termination date of Coverage under this
           Plan.

    8.9.   Converted Policy Provisions.  The converted policy may contain either
           or both of the following:

           (A)  A provision that benefits under it will be reduced by like
                benefits payable as to the individual under this Plan, for
                expenses Incurred after termination of Coverage under the Plan.

           (B)  A provision that the Claims Administrator may, on any premium
                due date of the converted policy, request information as to any
                individual's coverage under Section 8.4(A)(3)(a) through (d).
                If the individual fails to furnish the information requested by
                the Claims Administrator, any benefits under the converted
                policy may be based on actual expenses incurred reduced by
                expenses to

                                       56
<PAGE>
 
                the extent covered or provided under those subsections (a)
                through (d).

           For any individual named in the converted policy, the converted
           policy is in exchange for all privileges and benefits under this
           Plan.

                                       57
<PAGE>
 
9.  CLAIMS.

    9.1.   Submission of Claims.  All claims for Benefits shall be submitted to
           the Claims Administrator by the Covered Person.  Claims shall be made
           on properly completed forms approved by the Claims Administrator,
           with supporting documentation as required.  The Claims Administrator
           shall decide whether a Benefit will be paid or denied after providing
           a full review of the claim and documentation submitted.

    9.2.   Claim Form.  The Claims Administrator shall furnish a claim form to
           the Covered Person.  The Covered Person's claim shall include the
           dates, occurrence, and nature and extent of the claim.

    9.3.   Time Limit for Claims.  Claims in proper form and with all required
           information must be furnished to the Claims Administrator within 90
           days.  Later claims may be accepted only if, under the particular
           circumstances, the claim was furnished as soon as reasonably possible
           but no later than one (1) year after the date the claim is Incurred.
           No claim shall be accepted if it is received by the Claims
           Administrator after this period of time, unless the Covered Person is
           legally incapacitated as determined by the Claims Administrator.

    9.4.   Examination.  The Claims Administrator shall have the right and
           opportunity to arrange for the performance of an independent
           examination performed of the Covered Person whose Injury or Sickness
           is the basis of a claim under this Plan.  Such examination shall be
           permitted as often as reasonably required while claim is being made
           and shall be done at no cost to the Covered Person.

    9.5.   Right to Receive and Release Necessary Information.  To determine how
           and when the terms and provisions of the Plan or other plans shall
           apply, the Claims Administrator may, without the consent of or notice
           to any person, release to or obtain from any organization or person
           any information it considers necessary or appropriate.  Any Covered
           Person claiming Benefits shall furnish to the Claims Administrator
           any requested information that may be necessary or appropriate to
           implement this provision.  Neither the Plan, the Company, the Claims
           Administrator nor the Administrator shall be responsible for the
           direct or indirect consequences of a Covered Person's failure to
           provide required information in a timely manner.

                                       58
<PAGE>
 
    9.6.   Payment of Claim.   All Benefits shall be paid to the Covered Persons
           unless subject to a direction to pay under Section 9.7.  Should any
           claim under the Plan remain unpaid at the Covered Person's death, or
           if the Covered Person is a minor or is, in the opinion of the Claims
           Administrator, legally incapable of giving a valid receipt and
           discharge for any payment, the Claims Administrator may at its option
           pay the whole or any part of the Benefit, up to $1,000, to any of the
           Covered Person's relatives.

           Any payment made by the Claims Administrator shall constitute a
           complete discharge of the obligation under the Plan to the extent of
           such payment and neither the Plan nor the Company shall be required
           to oversee the application of the money so paid.

    9.7.   Direction to Pay/Non-Assignability of Benefits.  A Covered Person may
           direct payment of Benefits under this Plan to a Health Care Provider
           or institution which made the charges on which the Benefits are based
           if such direction is in writing and received by the Claims
           Administrator prior to payment of the Benefit.  A Covered Person's
           direction to pay benefits shall not be considered an assignment of
           any rights under this Plan.  The Claims Administrator may comply with
           the direction to pay unless the Covered Person submits a signed,
           written notice not to honor the direction to pay and the Claims
           Administrator receives it before the claim is submitted.

           A Covered Person is specifically prohibited from assigning any rights
           to Benefits or any other right the person may have arising under the
           terms of this Plan, except Medicaid assignments as described in the
           next paragraph.  No other assignment shall be binding upon the Claims
           Administrator, Administrator or Plan.

    9.8.   Medicaid Assignments.  Notwithstanding any contrary provision of this
           Plan, to the extent required by the Omnibus Budget Reconciliation Act
           of 1993, P.L. 103-66, as it may be amended from time to time, payment
           for a Benefit with respect to a Covered Person will be made in
           accordance with any assignment of rights made by or on behalf of such
           Covered Person as required by a Medicaid Plan.  In addition, to the
           extent that payment has been made under a Medicaid Plan in any case
           in which the Plan has a legal liability to make payment for items or
           services constituting such assistance, payment of any Benefit under
           the Plan will be made in accordance with any State law which provides
           that the State has acquired

                                       59
<PAGE>
 
           the rights with respect to a Covered Person to such payment for such
           items or services.

    9.9.   Charges Reported in Foreign Currency.  Benefits based on charges
           reported in foreign currency shall be determined in accordance with
           the rate of exchange between such currency and United States dollars
           in effect at the time Benefits are calculated.

    9.10.  Facility of Payment.  If payments made under any other plan should
           have been made under the Plan, the Claims Administrator shall have
           the right, exercisable in its discretion, to pay to any person or
           organization making such other payments any amounts it shall
           determine to be warranted in order to satisfy the intent of the Plan.
           Amounts so paid shall be deemed to be Benefits paid under the Plan
           and, to the extent of such payments, the Company, Plan, the
           Administrator and the Claims Administrator shall be fully discharged
           from liability under the Plan.

    9.11.  Right of Recovery.  Whenever payments have been made in excess of the
           amount provided by the Plan, the Claims Administrator shall have the
           right to:

           (A)  Recover such payment, to the extent of any excess, from among
                one or more of the following, as the Claims Administrator should
                determine:  any persons to or with respect to whom the payment
                was made, any insurance companies, or other organizations; and

           (B)  Deduct the total or any partial amount of such payment from any
                Benefits payable under the Plan.  Such deduction may be made
                against any claim for Benefits by a Covered Person or by any of
                his Covered Dependents if such payment is made with respect to
                such Covered Person or any person Covered or asserting Coverage
                as a Dependent of such Covered Person.

    9.12.  Subrogation.

           (A)  Plan's Right to Reimbursement.

                In the event of any Benefit payments made under the Plan to or
                on behalf of any Covered Person, the Plan shall, to the extent
                of such payments, be fully subrogated to all the rights of
                recovery and other rights of the Covered Person arising out of
                any claim or cause of action which may accrue because of the
                alleged accidental, negligent,

                                       60
<PAGE>
 
                intentional, or tortious conduct, act or omission, of another
                person or entity (hereinafter all such persons or entities shall
                be individually and collectively referred to as a "third
                party").  The Covered Person, by participation in the Plan,
                agrees that he and his estate, and the legal representative of
                his estate, shall be obligated and that the Plan shall be fully
                subrogated to any recovery or right of recovery that the estate
                may have against any third party, including without limitation,
                any wrongful death claim or action.

                The Covered Person, or the legal representative or beneficiaries
                of Covered Person or his estate, shall notify the Claims
                Administrator of any claim or lawsuit against a third party or
                insurance carrier within 30 days of the date that the claim is
                made or the lawsuit is filed.  The Claims Administrator, on
                behalf of the Plan, also has the right to pursue any action to
                enforce its subrogation rights against a third party.  The
                Claims Administrator may, in its discretion, elect not to
                enforce the Plan's subrogation rights to the extent consistent
                with its fiduciary obligations to the Plan.

           (B)  Covered Person's Agreement To Subrogation.

                The Covered Person, on behalf of himself and each beneficiary of
                a payment made on Covered Person's behalf, by accepting Benefits
                under the Plan, consents and agrees (1) that the Plan shall be
                promptly reimbursed for any payments made to or on the Covered
                Person's behalf under the Plan out of any monies recovered as
                the result of any lawsuit, judgment, order, award, settlement,
                compromise, arbitration or other arrangement, and (2) to include
                all Benefits paid or payable under the Plan in any liability or
                other claim against a third party.  Furthermore, Covered Person
                and beneficiaries promise and agree to take such action, to
                furnish such information and assistance, to execute and deliver
                any assignments, reimbursement agreements and other instruments
                as the Claims Administrator may require to facilitate
                enforcement of the Plan's subrogation rights, and not to
                prejudice, or in any way detrimentally affect, such rights.  The
                Plan's subrogation rights shall extend to all conceivable
                sources of recovery, other than the Plan itself, including, by
                way of example and not limitation, any and all automobile
                insurance

                                       61
<PAGE>
 
                coverage (including uninsured/underinsured motorist coverage),
                no-fault coverage, school insurance coverage, disability
                coverage and personal injury awards or settlements.

           (C)  Limitation To Plan's Subrogation Rights.

                The Plan's subrogation rights shall extend only to the recovery
                by the Plan of (1) the Benefits that it has paid or will pay to
                or on behalf of the Covered Person and (2) the cost of
                prosecuting the claim including reasonable attorney's fees and
                court and collection costs.

           (D)  Subrogation Rights Not Affected By Payment.

                The Plan's subrogation rights shall not be affected if Benefits
                are paid before the Claims Administrator obtains any additional
                agreement from the Covered Person (or from any other payee), or
                if the Claims Administrator does not request any such agreement.
                In addition, the failure or refusal of an Covered Person (or
                other payee, if applicable) to sign an agreement at the request
                of the Claims Administrator recognizing the Plan's subrogation
                rights shall result in a forfeiture of all Benefits payable to
                that Covered Person (or other payee) even if such Benefits have
                already been paid, and the Claims Administrator shall retain a
                right to recover paid Benefits which are forfeited; moreover,
                the Covered Person's failure or refusal shall not affect
                enforcement of the Plan's subrogation rights.

           (E)  Lien on Proceeds.

                The Claims Administrator, on behalf of the Plan, shall have a
                lien against the proceeds of any settlement, award or judgment
                that results from a claim or lawsuit by or on behalf of an
                Covered Person who received Benefits under the Plan.  Notice of
                the lien is sufficient to establish the Plan's lien against the
                third party or insurance carrier.  The Claims Administrator
                shall be entitled to (i) deduct the amount of the lien from any
                future claims payable to or on behalf of the Covered Person if
                (A) the lien is not repaid or otherwise recovered by the Claims
                Administrator or (B) the Covered Person or other claimant fails
                to promptly notify the Claims Administrator of a payment
                received from a third party or insurance carrier that is subject
                to the Plan's subrogation

                                       62
<PAGE>
 
                rights, and (ii) to otherwise take any action that the Claims
                Administrator deems necessary or appropriate to enforce the
                Plan's subrogation rights.

    9.13.  Review and Appeal of Claim.  If a claim is denied in whole or in
           part, the Claims Administrator shall provide the claimant with
           written notice of such denial.  Such notice shall be written in a
           manner calculated to be understood by the claimant.  It shall also
           state the specific reason or reasons for such denial, reference the
           specific plan provisions on which the denial is based, and explain
           the review procedure.

           To appeal an unfavorable determination, the claimant or his
           authorized representative must file a written application for review
           with the Claims Administrator within sixty (60) days of the receipt
           of a notice of denial of benefits.  An appeal shall be considered as
           filed on the date received by the Claims Administrator.  After the
           filing of an appeal and prior to a final decision on it, the claimant
           or his representative may review Plan Documents and submit issues and
           comments in writing.

           No later than 60 days after receipt of the request for the review,
           the Claims Administrator shall render a decision on the appeal,
           unless special circumstances, such as a request for a hearing,
           require a greater period of time.  In such a case a final
           determination shall be rendered no more than 120 days after receipt
           of the request for review.  If no decision is received within 120
           days, the claim will be deemed to be denied without further action or
           notice.

    9.14.  Authority of Claims Administrator.  In making initial claim
           determinations, the Claims Administrator shall consider the terms and
           provisions of the Plan and shall have the power and discretion to
           construe such terms and provisions.  All such determinations made by
           the Claims Administrator, whether in the case of an appeal from an
           initial claim denial or in the case of an initial determination which
           is not appealed, arising in connection with the administration,
           interpretation and/or application of the Plan shall be conclusive and
           binding upon all persons and entities.

    9.15.  Interpretation and Administration.  The Claims Administrator shall
           have the absolute right and power to administer and to interpret,
           construe and construct the terms and provisions of the Plan,
           including, without limitation, correcting any error or defect,
           supplying

                                       63
<PAGE>
 
           any omission, and reconciling any inconsistency with respect to
           matters delegated to the Claims Administrator under the Plan;
           provided, however, that with respect to the final determination of
           eligibility of individuals to become or continue as Covered Persons,
           such authority shall be reserved to the Administrator.  The Claims
           Administrator shall have the absolute right and power to make all
           decisions that may impact a claim for Benefits, including factual
           determinations.  Subject only to the claims review procedure set
           forth in the Plan, any determination, decision, computation, or
           interpretation made by the Claims Administrator under the Plan shall
           be final, binding and conclusive on all persons and entities.

           The Administrator reserves the absolute right and power to review all
           initial determinations and make all final determinations with respect
           to eligibility of individuals to become or continue as Covered
           Persons, and any such determination, decision, computation or
           interpretation made by the Administrator under the Plan shall be
           final, binding and conclusive upon all persons and entities.

           The Plan shall be interpreted by the Administrator or Claims
           Administrator, as applicable in accordance with the terms and
           provisions of the Plan and their intended meanings.  However, the
           Claims Administrator shall have the discretion to make any findings
           of fact needed in the administration of the Plan, and shall have the
           discretion to interpret or construe ambiguous, unclear or implied
           (but omitted) terms in any fashion it deems to be appropriate in its
           judgment.  The validity of any such finding of fact, interpretation,
           construction or decision shall not be given de novo review if
                                                       -- ----          
           challenged in court, by arbitration or in any other forum, and shall
           be upheld unless clearly arbitrary or capricious.

           To the extent the Claims Administrator or another Plan fiduciary has
           been granted discretionary authority under the Plan, the prior
           exercise of such authority by the Plan fiduciary shall not obligate
           it to exercise its authority in a like fashion thereafter.

           If, due to errors in drafting, any Plan provision does not accurately
           reflect its intended meaning, as demonstrated by prior
           interpretations or other evidence of intent, or as determined by the
           Claims Administrator or, with respect to the final determination of
           eligibility of a Covered Person to participate in the Plan, the
           Administrator in its discretion, the provision shall be considered
           ambiguous and shall be interpreted

                                       64
<PAGE>
 
           by the Claims Administrator in a fashion consistent with its intent,
           as determined by the Claims Administrator or, with respect to the
           final determination of eligibility of a Covered Person to participate
           in the Plan, the Administrator.  The Plan may be amended
           retroactively to cure any such ambiguity, notwithstanding anything in
           the Plan to the contrary.

           The provisions of this section may not be invoked by any person to
           require the Plan to be interpreted in a manner which is inconsistent
           with its interpretation by the Claims Administrator or, with respect
           to the final determination of eligibility of a Covered Person to
           participate in the Plan, the Administrator.  All actions taken and
           all determinations by the Claims Administrator or by another Plan
           fiduciary shall be final and binding upon all persons claiming any
           interest in or under the Plan subject only to the claims review
           procedures of the Plan.

    9.16.  Legal Actions.  No action at law or in equity shall be brought to
           recover any benefit under the Plan after the expiration of 3 years
           from the deadline for filing claims.

    9.17.  Qualified Medical Child Support Orders.  Pursuant to the procedures
           established by the Plan with respect to the handling of a "qualified
           medical support child order" within the meaning of Section
           609(a)(2)(A) of ERISA ("QMCSO"), in the event that the Plan receives
           a medical child support order that the Claims Administrator
           determines to be a valid QMCSO, any person who is an "alternate
           recipient" under such QMCSO shall be considered a Dependent covered
           under the Plan for all purposes of ERISA and as a Covered Person for
           purposes of the reporting and disclosure provisions of ERISA.  Any
           payment of Benefits made pursuant to a QMCSO as reimbursement for
           Covered Expenses on behalf of an alternate recipient shall be made to
           the alternate recipient or to the alternate recipient's custodial
           parent or legal guardian, as determined by the Claims Administrator.

                                       65
<PAGE>
 
10. GENERAL PROVISIONS.

    10.1.  Benefits.  Benefits shall be subject to all terms, provisions,
           conditions, limitations and exclusions of the Plan.

    10.2.  Compliance with Federal Law.  The Plan shall comply with all federal
           laws and regulations to which it is subject.  To the extent that any
           provision of the Plan is in conflict with any such federal law or
           regulation as determined by the Administrator, the federal law or
           regulation will control.  If, in the opinion of the Administrator,
           the applicability of any such law or regulation is unclear, the
           Administrator shall have the right to decide the question of such
           applicability until the law is clarified by the appropriate
           governmental authority.

    10.3.  Effective Times.  Any change in Coverage under the Plan shall take
           effect as of 12:00:01 A.M. standard time at the Company's principal
           office on the effective date of such change.

           Termination of the Plan or of any Coverage hereunder shall take
           effect at 12:00:00 midnight standard time at the Company's principal
           office on the effective date of such termination.

           Plan Years and Plan months shall begin at 12:00:01 A.M. standard time
           at the Company's principal office on the dates involved, and they
           shall end at 12:00:00 midnight standard time at the end of the dates
           involved.

    10.4.  Errors/Delays.  Clerical errors or unintentional errors on records of
           the Administrator or Claims Administrator, and delays in making
           entries on such records, shall not affect Coverage.

    10.5.  Entire Contract.  The Plan Document (including any insurance policy
           providing benefits under this Plan) and the applications of the
           Covered Persons, including any required evidence of good health,
           shall constitute the entire contract of Coverage between the Company
           and the Covered Persons.

    10.6.  Physical Examination and Autopsy.  The Claims Administrator or
           Administrator reserves the right to examine any Covered Person,
           including an autopsy examination.  Any such examination made will be
           at the expense of the Plan.

                                       66
<PAGE>
 
    10.7.  Termination or Amendment of the Plan.  The Company, through its duly
           authorized officers, may amend or terminate this Plan at any time for
           any reason by written instrument, including but not limited to, an
           amendment terminating, reducing or modifying any of these Plan
           provisions as to any Covered Person.  Notwithstanding the above, no
           provision of the Plan regarding pediatric vaccines shall be amended
           except as permitted by the Omnibus Budget Reconciliation Act of 1933,
           P.L. 103-66, as it may be amended from time to time, or other
           applicable law.

    10.8.  No Replacement for Workers' Compensation.  The Plan does not replace
           Workers' Compensation or affect any requirement for Workers'
           Compensation coverage.

    10.9.  Physician-Patient Relationship.  The Plan is not intended to disturb
           the Physician-patient relationship.  Physicians and other Health Care
           Providers are not agents or delegates of the Company, Administrator
           or the Claims Administrator.  The actual provision of medical and
           other services on behalf of any Covered Person remains the sole
           prerogative and responsibility of the attending Physician or other
           Health Care Provider.

    10.10. Representations.  Statements made by or on behalf of any person to
           obtain coverage under the Plan shall be deemed representations and
           not warranties.

    10.11. Misstatements of Eligibility Information.  If any relevant
           information has been misstated or omitted by or on behalf of a person
           to obtain Coverage, correct information shall be used to determine
           whether and to what extent the Coverage shall be in force.  The
           Administrator may rescind Coverage upon the discovery of any
           misstatement or omission.

    10.12. Mistake of Fact.  When a Plan fiduciary becomes aware of any mistake
           of fact in a document, he shall correct the mistake and make any
           proper adjustment required.  A fiduciary shall not be liable in any
           manner for any such determination made in good faith.

    10.13. Reliance on Documents and Information.  Evidence required by the
           Claims Administrator or Administrator of anyone under the Plan may be
           made by any document which the Claims Administrator or Administrator
           considers acceptable.  The Administrator shall be entitled to
           conclusively rely upon, and shall be protected for any action or
           failure to act taken in good faith in relying upon, any information
           furnished by an Executive or Retiree, Dependent, Company, Claims
           Administrator, or

                                       67
<PAGE>
 
           any accountant, counsel or other specialist appointed by the
           Administrator or the Claims Administrator.

    10.14. Waiver.  The Administrator's or Claims Administrator's failure to
           enforce strictly any term or provision of the Plan shall not be
           construed as a waiver of such term or provision.  The Administrator
           or Claims Administrator reserves the right to enforce strictly any
           term or provision of the Plan at any time, regardless of the nature
           or number of prior occurrences or the similarity of the
           circumstances.

    10.15. Plan Not a Contract of Employment.  Nothing contained in the Plan
           shall be construed as (i) a contract of employment between the
           Company and any Executive, (ii) a right of any Executive to be
           continued in the employment of the Company, (iii) consideration or
           inducement for employment with the Company, (iv) a condition of
           employment between the Company and any Executive, or (v) a limitation
           of the right of the Company to discharge any Executive, with or
           without cause, at any time.  All Executives shall be subject to
           discharge to the same extent as if the Plan had never been adopted.

    10.16. No Guarantee of Tax Consequences.  No representation, commitment or
           guarantee is made that any amounts paid under the Plan will be
           excludable from the recipient's gross income for any tax purpose, or
           that any other tax treatment will apply or be available to such
           person.

    10.17. Severability.  In the event that any term or provision of the Plan
           shall be held illegal or invalid for any reason, such illegality or
           invalidity shall be fully severable and shall not affect the
           remaining terms and provisions of the Plan, and, furthermore, the
           Plan shall be construed and enforced as if the illegal or invalid
           term or provision had not been included herein.

    10.18. Construction.  Whenever the context of the Plan so requires, any
           gender shall include the other genders, and words used in the
           singular or plural shall include the other.  The words "herein,"
           "hereof," "hereunder," and other similar compounds of the word "here"
           shall refer to the entire Plan, not to any particular article,
           section or provision of the Plan.  Headings of articles and sections
           as used herein are inserted solely for convenience and reference and
           shall not create an inference, implication, or presumption of the
           construction of the Plan.

                                       68
<PAGE>
 
    10.19. Governing Law. The terms, conditions and provisions of the Plan shall
           be construed, governed and enforced under ERISA or other controlling
           federal law and, if not otherwise preempted, under the laws of the
           State of Texas. The Plan is an "employee welfare benefit plan", as
           defined in Section 3(l) of ERISA, as a plan maintained for the
           purpose of providing medical, hospital care, and other benefits as
           provided herein. 

                                       69
<PAGE>
 
11. DEFINITIONS.

    The capitalized terms of the Plan shall have the meanings set forth below,
    except where the context clearly indicates otherwise.

    11.1.  Accident.  A sudden, unexpected, unusual, specific event that occurs
           at an identifiable time and place.

    11.2.  Actively at Work or Active Full-Time Work.  An Executive shall be
           deemed Actively at Work if he is performing all the regular duties of
           his occupation on the date in question.

    11.3.  Administrator.  The Benefits Administrative Committee of Lyondell
           Petrochemical Company, which is the plan administrator for purposes
           of ERISA.  Pursuant to the terms and conditions of the Plan, the
           Administrator may delegate its fiduciary duties to a third party
           administrator.

    11.4.  Benefits.  Benefits provided by the Plan for payment or reimbursement
           of Covered Expenses.

    11.5.  Birthing Center.  A freestanding facility which must:

           (A)  Meet licensing standards.

           (B)  Be set up, equipped and run to provide prenatal care, delivery
                and immediate postpartum care.

           (C)  Make charges.

           (D)  Be directed by at least one Physician who is a specialist in
                obstetrics and gynecology.

           (E)  Have a Physician or certified nurse midwife present at all
                births and during the immediate postpartum period.

           (F)  Extend staff privileges to Physicians who practice obstetrics
                and gynecology in an area hospital.

           (G)  Have at least 2 beds or 2 birthing rooms for use by patients
                while in labor and during delivery.

           (H)  Provide, during labor, delivery and the immediate postpartum
                period, full-time skilled nursing services, under the direction
                of a registered graduate nurse (R.N.) or certified nurse
                midwife.

                                       70
<PAGE>
 
           (I)  Provide, or arrange with a facility in the area for, diagnostic
                x-ray and laboratory services for the mother and the child.

           (J)  Have the capacity to administer a local anesthetic and to
                perform minor surgery, including episiotomy and repair of
                perineal tear.

           (K)  Be equipped and have trained staff to handle medical emergencies
                and provide immediate support measures to sustain life if
                complications arise during labor or if a child is born with an
                abnormality which impairs function or threatens life.

           (L)  Accept only patients with low risk pregnancies.

           (M)  Have a written agreement with a Hospital in the area for
                emergency transfer of a patient or a child.  Written procedures
                for such a transfer must be displayed and the staff must be
                aware of them.

           (N)  Provide an ongoing quality assurance program including reviews
                by Physicians who do not own or direct the facility.

           (O)  Keep a medical record on each patient and child.

    11.6.  Board and Room Charges.  The institution's charges for board and room
           and its charges for other Necessary institutional services and
           supplies, made regularly at a daily or weekly rate as a condition of
           occupancy of the type of accommodations occupied, based on (i) the
           institution's average daily private room and board rate, (ii) if the
           institution is a Hospital and the Claims Administrator determines it
           Necessary, the Hospital's intensive care unit rate or (iii) if the
           institution is a Convalescent Facility without private rooms, the
           average private room and board rate for similar institutions in the
           area.  Board and Room Charges shall include any general nursing
           services provided by the staff of the institution.

    11.7.  Child.

           (A)  The Covered Person's natural child, legally adopted child or
                step child,

           (B)  any child under the age of 18 who is placed for adoption with
                the Covered Person, or

                                       71
<PAGE>
 
           (C)  any other child for whom the Covered Person is a legal guardian
                or managing conservator.

    11.8.  Claims Administrator.  Except as otherwise may be designated by the
           Administrator, AEtna Life Insurance Company shall be the Claims
           Administrator.

    11.9.  COBRA.  The Consolidated Omnibus Budget Reconciliation Act of 1985,
           as amended.

    11.10. Company.  Lyondell Petrochemical Company and any successor thereto.

    11.11. Convalescent Facility.  An institution (or distinct part thereof)
           that:

           (A)  Is licensed to provide and is engaged in providing, on an in-
                patient basis, for persons convalescing from Injury or Sickness,
                professional nursing services rendered by a registered graduate
                nurse (R.N.) or by a licensed practical nurse (L.P.N.) under the
                direction of a registered graduate nurse, physical restoration
                services to assist patients to reach a degree of body
                functioning to permit self-care in essential daily living
                activities;

           (B)  Provides services for compensation from its patients and under
                the full-time supervision of a Physician or registered graduate
                nurse;

           (C)  Provides 24 hour per day nursing services by licensed nurses,
                under the direction of a full-time registered graduate nurse;

           (D)  Maintains a complete medical record of each patient;

           (E)  Has an effective utilization review plan; and

           (F)  Is not, other than incidentally, a place for rest, the aged,
                mental retardation, Custodial Care, Educational Care, or care of
                Substance Dependency or Mental Health Problems.

    11.12. Cover, Covered and Coverage.  Coverage under the Plan.

    11.13. Covered Expenses or Covered Medical Expenses.  Charges for which
           Benefits are specifically provided under the provisions of this Plan.

                                       72
<PAGE>
 
    11.14. Covered Person. An Executive, Retiree or Dependent while covered
           under the Plan. With reference to an Executive's Dependent, "covered
           under the Plan" shall mean that the Executive has Coverage for that
           Dependent, except as otherwise may be required under COBRA.

    11.15. Custodial Care.  Care consisting of services and supplies, provided
           to a Covered Person in or out of an institution, primarily to assist
           in daily living activities, whether or not the Covered Person is
           disabled, and no matter by whom recommended or furnished.

           Board and room and skilled nursing services are not, however,
           considered Custodial Care (i) if provided during confinement in an
           institution for which Coverage is available under this Plan, and (ii)
           if combined with other Necessary therapeutic services, under accepted
           medical standards, which can reasonably be expected to substantially
           improve the Covered Person's medical condition.

    11.16. Dentist.  A legally qualified dentist or a Physician authorized by
           his license to perform, at the time and place involved, the
           particular dental procedure rendered by him.

    11.17. Dependent.

           (A)  The Spouse of a Covered Executive or Retiree;

           (B)  Any unmarried Child to the end of the month in which he attains
                age 19;

           (C)  Any unmarried Child from his 19th birthday to the end of the
                month in which he attains age 25 provided that the Child depends
                on the Covered Executive or Retiree for the majority of his
                support on the date the expense is Incurred.

           (D)  Any unmarried Child from his 19th birthday, provided the Child
                was Covered as a Dependent before age 19 and became
                incapacitated or incapable of employment due to a mental or
                physical handicap which occurred before the Child became 19,
                provided, further, that the Covered Person provides satisfactory
                verification of continued incapacity to the Administrator when
                requested.

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<PAGE>
 
           (E)  Any child who is required to be treated as a Dependent under the
                terms of any valid qualified medical child support order.

           Except as otherwise required under a valid qualified medical child
           support order, the term "Dependent" shall not include any person who
           (i) does not qualify as a Dependent for whom an exemption is claimed
           by the Covered Executive or Retiree on his current federal tax return
           filed in compliance with the Internal Revenue Code of 1986, as
           amended, (ii) does not live with the Covered Executive in a regular
           parent-child relationship, if the person is a Child, (iii) is on
           active duty with the armed forces of any country.  A Dependent Child
           of parents who are both Covered Executives will be considered the
           Dependent of both parents.

    11.18. Diagnosis Related Group (DRG).  Classifications of inpatient cases
           which group inpatients by principal diagnosis and other relevant
           factors.

    11.19. DRG Amount.  A predetermined charge for each Diagnosis Related Group,
           as determined by any applicable law or regulation, or otherwise by
           the Claims Administrator.

    11.20. Durable Medical Equipment.  Equipment for medical or surgical
           purposes that

           (A)  is designed to withstand prolonged use in the treatment of a
                Sickness or Injury,

           (B)  is suitable for use in the Covered Person's home;

           (C)  is not normally of use to persons who do not have a Sickness or
                Injury;

           (D)  is not normally for use in altering air quality or temperature;

           (E)  is not for the purpose of exercise or training of persons who do
                not have a Sickness or Injury.

    11.21. Effective Date.  October 1, 1990, the effective date of this
           amendment and restatement of the Plan.

    11.22. Effective Treatment of Substance Dependency.  A program of
           Substance Dependency therapy that is prescribed and supervised by a
           Physician and meets either of the following:

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<PAGE>
 
           (A)  The Physician certifies that a follow-up program has been
                established which includes therapy by a Physician, or group
                therapy under a Physician's direction, at least once per month.

           (B)  It includes attendance at least twice a month at meetings of
                organizations devoted to the therapeutic treatment of Substance
                Dependency.

           Treatment solely for detoxification or primarily for maintenance care
           is not considered effective treatment.  Detoxification is care aimed
           primarily at overcoming the aftereffects of a specific episode of
           Substance Dependency.  Maintenance care consists of the providing of
           an environment without access to alcohol or one or more Controlled
           Substances or Illegal Drugs.

    11.23. Executive.  An individual who is employed by the Company and is paid
           on the Company's executive payroll or a former Executive whom the
           Company determines shall continue to be eligible to participate under
           this Plan.

    11.24. ERISA.  The Employee Retirement Income Security Act of 1974, as
           amended, and the implementing regulations issued thereunder by the
           appropriate governmental authority.  References herein to any Section
           of ERISA shall include reference to any successor section of ERISA.

    11.25. Experimental.  A treatment, procedure, device or drug which the
           Claims Administrator, in the exercise of its discretion, determines
           does not constitute accepted  medical practice under the standards of
           a reasonably substantial, qualified, responsible and relevant segment
           of the medical community after taking into account whether the
           treatment, procedure, drug or device is Necessary.

           The Claims Administrator shall make an evaluation of the Experimental
           standing of a specific treatment, procedure, device or drug.  The
           decision of the Claims Administrator shall be rendered following a
           review of the case and the proposed treatment.

    11.26. FMLA Leave.  Leave approved in accordance with the Company's FMLA
           Policy.

    11.27. FMLA Policy.  The Lyondell Petrochemical Company Family and Medical
           Care Leave Policy.

                                       75
<PAGE>
 
    11.28. Freestanding Surgical Facility. A specialized institution which meets
           all of the following requirements:

           (A)  It is permanently established, equipped and operated solely to
                accommodate the performance of outpatient surgery by Physicians
                who are legally authorized to perform surgery;

           (B)  It has at least two operating rooms and at least one recovery
                room; is equipped to perform diagnostic lab and x-ray procedures
                in connection with surgery; has resuscitation equipment for
                emergencies resulting from surgery, a blood bank and other blood
                supplies;

           (C)  It has the full-time services of registered nurses for patient
                care in operating and recovery rooms;

           (D)  It has a written agreement with one or more Hospitals in the
                area for immediate acceptance of patients who develop
                complications or require post-operative confinement; and

           (E)  It has an organized medical staff supervising its operations as
                required by established policy and maintains adequate medical
                records for all patients.

    11.29. Health Care Provider.  Any Physician, registered graduate nurse,
           licensed practical nurse, home health aide, speech or physical
           therapist, licensed social worker or family counselor or Hospital,
           facility, laboratory or other individual or entity that provides
           services which are eligible for reimbursement under the Plan as
           Covered Expenses.

    11.30. Home Health Care.  Services that are rendered pursuant to a Home
           Health Care Plan and which are Necessary to treat an Injury or
           Sickness for which a Covered Person would otherwise have required
           inpatient confinement in a Hospital or similar institution and are
           rendered pursuant to a Home Health Care Plan.  Home Health Care
           services shall be limited to:

           (A)  Part-time or intermittent nursing care rendered by a registered
                nurse or a licensed practical nurse under the supervision of a
                registered nurse;

           (B)  Physical, occupational and speech therapy rendered or supervised
                by a duly qualified therapist;

                                       76
<PAGE>
 
           (C)  Medical supplies, drugs and medicines prescribed by a Physician;

           (D)  Laboratory services that would have been provided had the
                Covered Person been confined in a Hospital;

           (E)  Part-time or intermittent home health aide services provided in
                the Covered Person's home. Such services shall consist primarily
                of patient care of a medical or therapeutic nature.

           Home Health Care shall not include (i) services or supplies that are
           rendered by a person who ordinarily resides in the Covered Person's
           home or is a member of the Covered Person's or his spouse's family;
           (ii) custodial care; (iii) transportation services; (iv) services or
           supplies furnished while the Covered Person is not under the
           continuous care of a Physician.

    11.31. Home Health Care Agency.  An agency or organization which meets fully
           every one of the following requirements:

           (A)  It is primarily engaged in and duly licensed, if such licensing
                is required, by the appropriate licensing authority to provide
                skilled nursing services and other therapeutic services.

           (B)  It has policies established by a professional group associated
                with the agency or organization.  This professional group must
                include at least one Physician and at least one registered
                graduate nurse (R.N.) to govern the services provided and it
                must provide for full-time supervision of such services by a
                Physician or by a registered graduate nurse (R.N.).

           (C)  It maintains a complete medical record on each patient.

           (D)  It has a full-time administrator.

    11.32. Home Health Care Plan.  A program for care and treatment of the
           Covered Person established and approved in writing by such Covered
           Person's attending Physician.  The attending Physician must certify
           that the proper treatment of the disease or injury would require
           confinement as a resident inpatient in a Hospital or Convalescent
           Facility in the absence of the services and supplies provided as part
           of the home health care plan.

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<PAGE>
 
    11.33. Hospice Care. Care given to a Terminally Ill Covered Person by or
           under arrangements with a Hospice Care Agency. The care must be part
           of a Hospice Care Program.

           Hospice Care shall not include charges for bereavement counseling,
           funeral arrangements, pastoral counseling, financial or legal
           counseling, homemaker or caretaker services for the Covered Person or
           his family, transportation, home maintenance or respite care, or any
           charges for which Benefits are payable under any other section of
           this Plan or any other plan maintained by the Company.

    11.34. Hospice Care Agency.  An agency or organization which:

           (A)  Has Hospice Care available 24 hours a day.

           (B)  Meets any licensing or certification standards set forth by the
                jurisdiction where it is.

           (C)  Provides:

                (1)  Skilled nursing services.
                (2)  Medical social services.
                (3)  Psychological and dietary counseling.
                (4)  Bereavement counseling for the immediate family.

           (D)  Provides or arranges for other services which will include:

                (1)  Services of a Physician.
                (2)  Physical or occupational therapy.
                (3)  Part-time home health aide services which mainly consist of
                     caring for Terminally Ill individuals.
                (4)  Inpatient care in a facility when needed for pain control
                     and acute and chronic symptom management.

           (E)  Has personnel which include at least:

                (1)  One Physician.
                (2)  One registered nurse (R.N.).
                (3)  One licensed or certified social worker employed by the
                     Agency.
                (4)  One pastoral or other counselor.

           (F)  Establishes policies governing the provision of Hospice Care.

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           (G)  Assesses the patient's medical and social needs.

           (H)  Develops a Hospice Care Program to meet those needs.

           (I)  Provides an ongoing quality assurance program, including reviews
                by Physicians, other than those who own or direct the Agency.

           (J)  Permits all area medical personnel to utilize its services for
                their patients.

           (K)  Keeps a medical record on each patient.

           (L)  Utilizes volunteers trained in providing services for non-
                medical needs.

           (M)  Has a full-time administrator.

    11.35. Hospice Care Program.  A written plan of Hospice Care, which:

           (A)  Is established by and reviewed from time to time by a Physician
                attending the Covered Person and
                appropriate personnel of a Hospice Care Agency;

           (B)  Is designed to provide (i) palliative and supportive care to
                Terminally Ill Covered Persons and (ii) supportive care to their
                families;

           (C)  Includes (i) an assessment of the Covered Person's medical and
                social needs and (ii) a description of the care to be rendered
                to meet those needs.

    11.36. Hospice Facility.  A facility, or distinct part of one, which:

           (A)  Mainly provides inpatient Hospice Care to Terminally Ill Covered
                Persons.

           (B)  Charges its patients.

           (C)  Meets any licensing or certification standards set forth by the
                jurisdiction where it is.

           (D)  Keeps a medical record on each patient.

           (E)  Provides an ongoing quality assurance program, including reviews
                by Physicians other than those who own or direct the facility.

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           (F)  Is run by a staff of Physicians, at least one who must be on
                call at all times.

           (G)  Provides, 24 hours a day, nursing services under the direction
                of a registered nurse (R.N.).

           (H)  Has a full-time administrator.

    11.37. Hospital.  An institution meeting all the following tests:

           (A)  It engages primarily in providing, on an inpatient basis,
                diagnostic and therapeutic facilities for surgical and medical
                diagnosis, treatment, and care of injured and sick persons.

           (B)  Its services are provided for compensation by its patients and
                under the supervision of a staff of Physicians.

           (C)  It provides 24 hour per day registered graduate nursing (R.N.)
                services.

           (D)  It is not, other than incidentally, a nursing home, a place for
                rest, or for the aged or substance dependents.

    11.38. Incurred.  The charge for a service or supply is considered to be
           incurred on the date the service was rendered or the item furnished.
           In the absence of due proof to the contrary when a single charge is
           made for a series of services, each service will be considered to
           bear a pro rata share of the charge.

    11.39. Injury.  Accidental bodily injury that (i) is sustained by a person
           while he or she is covered under the Plan and (ii) does not arise out
           of (or in the course of) any work performed by the Covered Person for
           pay or profit or result in any way from an Injury that does arise
           from such work.  Such injury must result in loss directly and
           independently of all other causes.  All bodily injuries caused by one
           Accident shall be considered as one Injury.

    11.40. Intensive Care Unit.  An area within a Hospital which is specifically
           reserved, specially equipped, and specially staffed by the Hospital
           for the treatment and care of patients who are so critically ill as
           to required extraordinary, continuous, and intensive nursing care for
           the preservation of life.

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    11.41. Medical Emergency. The sudden and unexpected onset of acute
           conditions requiring medical care such as heart attacks,
           cardiovascular accidents, poisoning, loss of consciousness or
           respiration.

    11.42. Medicare.  The "Health Insurance For The Aged and Disabled" part of
           the U.S Social Security Act, as now constituted or later amended.

    11.43. Medicare Eligibility.  A Covered Person is "eligible for Medicare"
           during any period he either has coverage under Medicare or, while
           otherwise qualifying for coverage under Medicare, does not have such
           coverage solely because he has refused, discontinued, or failed to
           make any necessary application for, Medicare Coverage.

    11.44. Mental Health Problems.  A disease or condition (i) for which
           treatment is rendered by a Health Care Provider acting within the
           scope of his license or certification to provide care for Mental
           Health Problems defined in (ii);  (ii) that is (a) classified as a
           mental disorder in the current edition of International
           Classification of Diseases published by the United States Department
           of Health and Human Services, (b) listed in the current edition of
           Diagnostic and Statistical Manual of Mental Disorders published by
           the American Psychiatric Association or (c) determined to be a Mental
           Health Problem by the Claims Administrator, in its discretion.
           Mental Health Problems shall include, but shall not be limited to,
           mental, adjustment, anxiety, mood, eating, psychoneurotic and
           personality disorders, but shall specifically exclude non-medical
           conditions such as family or marital problems.

    11.45. Necessary.  Coverage is only provided for a service or supply
           which, as determined by the Claims Administrator in its sole
           discretion, is necessary for the diagnosis, care, or treatment of the
           physical or mental condition involved whether or not prescribed,
           recommended or approved by the attending Physician or dentist.  The
           service or supply must be widely accepted professionally in the
           United States as effective, appropriate, and essential based upon
           recognized standards of the health care specialty involved.

           In no event will the following be considered to be Necessary:

           (A)  Those services rendered by a Health Care Provider that do not
                require the technical skills of a Health Care Provider.

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           (B)  Those services and supplies furnished mainly for the personal
                comfort or convenience of the Covered Person, any person who
                cares for him, or any person who is part of his family.

           (C)  Those services and supplies furnished to Covered Person solely
                because he is an inpatient on any day on which the Covered
                Person's physical or mental condition could safely and
                adequately be diagnosed or treated while not confined.

           (D)  That part of the cost which exceeds that of any other service or
                supply that would have been sufficient to safely and adequately
                diagnose or treat the Covered Person's physical or mental
                condition.

    11.46. Non-occupational Disease. A disease is considered non-occupational
           only if it does not arise out of (or in the course of) any work for
           pay or profit nor, in any way, results from a disease which does.
           However, if proof is furnished to the Claims Administrator that an
           individual covered under a Worker's Compensation Law (or other law of
           similar purpose), is not covered for a particular disease under such
           law, that disease shall be considered "non-occupational" regardless
           of its cause.

    11.47. Non-occupational Injury. An injury is considered non-occupational
           only if it is an accidental bodily injury and does not arise out of
           (or in the course) any work for pay or profit nor, in any way,
           results from an injury which does.

    11.48. Obstetric Care.  The following items prescribed by a Physician and
           required solely to manage pregnancy and/or to treat Sickness caused
           directly by pregnancy, excluding all services and supplies furnished
           by a Hospital, a pathologist, a radiologist, an anesthesiologist and
           an assistant surgeon in connection with inpatient confinement:

           (A)  Drugs, medicines, diagnostic tests and medical equipment for
                monitoring or testing;

           (B)  Services rendered by a Physician during the course of or
                immediately following termination of pregnancy, including, but
                not limited to, Cesarean or vaginal delivery, episiotomy and
                treatment for ectopic pregnancy and spontaneous abortion and
                voluntary abortion; and

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           (C)  One visit to a Physician following termination of pregnancy.

    11.49. Office Visit.  Services rendered by a Physician at the Physician's
           place of business (other than a Hospital, Skilled Nursing Facility,
           Convalescent Facility, Treatment Facility or Hospice) for which
           Covered Medical Expenses are Incurred.

    11.50. Orthodontic Treatment.  Any medical or dental service or supply
           furnished to prevent, diagnose, or correct a misalignment of the
           teeth, bite, or jaws or jaw joint relationships, whether or not for
           the purposes of relieving pain, excluding the installation of a space
           maintainer or a surgical procedure to correct malocclusion.

    11.51. Period of Hospital Confinement.  As to Hospital Expense Benefits and
           In-Hospital Physician Expense Benefits, all Hospital confinements of
           a Covered Person will be considered as beginning during one period of
           disability (regardless of any interruption in Coverage).  However,
           the latest confinement will not be considered as having begun during
           the same period of disability as prior confinements if any of the
           following applies:

           (A)  No cause of the latest confinement can be connected with a cause
                of any prior confinement.

           (B)  A cause of the latest confinement can be connected with a cause
                of a prior confinement but, between the last previous connected
                confinement and the latest confinement the Covered Person has
                recovered from all causes of the prior connected confinements.

           (C)  The Covered Person is an active Executive and has returned to
                active work for a full day; or

           (D)  The Covered Person is a Retiree or Dependent and has not been
                confined in a hospital for at least 90 days.

    11.52. Pharmacy.  An establishment where Prescription Drugs are legally
           dispensed.

    11.53. Physician.  A legally qualified physician.  However, if another
           practitioner lawfully performs a service for which a Benefit is
           provided under this Plan when performed by a Physician and if
           applicable law requires the recognition of such practitioner under
           this Plan, the term "Physician" will also include such a

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           practitioner but only to the extent required by law.  For purposes of
           determining Mental Health Problem Benefits, a legally qualified
           Physician will also include a licensed or certified psychologist, a
           licensed social worker and a licensed family and child counselor who
           is under the direct supervision of a psychiatrist or a licensed or
           certified psychologist, if the care of the social worker or counselor

                (1)  is required to diagnosis or treat the Mental Health
                     Problem;

                (2)  the patient has been referred by a licensed psychologist or
                     a Physician; and

                (3)  the patient is directly and personally attended to by the
                     licensed psychologist or Physician at least once for every
                     four visits to the social worker or counselor.

    11.54. Plan.  The Lyondell Petrochemical Company Executive Medical Plan, as
           described herein, as it may be amended from time to time.

    11.55. Plan Document.  The document setting forth the terms and conditions
           of the Lyondell Petrochemical Company Executive Medical Plan, as
           amended and restated effective October 1, 1990, including any
           insurance contract.

    11.56. Plan Year.  The calendar year.

    11.57. Prescription.  An order of a Physician or other health care
           professional, acting within the scope of his or her license and legal
           authority, for a Prescription Drug.  Any oral Prescription must
           promptly be recorded in writing by the Pharmacy.

    11.58. Prescription Drugs.  A drug, biological or compounded Prescription
           which, by federal law, may be dispensed only by Prescription and
           which is required to be labeled as such;  injectable insulin,
           disposable needles and syringes and disposable diabetic supplies;
           smoking cessation aids prescribed by a Physician.

    11.59. Reasonable Charge.  The Reasonable Charge for a service or supply is
           the lower of (i) the Health Care Provider's usual charge for
           furnishing it; and (ii) the charge the Claims Administrator
           determines to be the prevailing charge level in the geographic area
           where it is furnished.

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           In determining the Reasonable Charge for a service or supply that is
           unusual, not often provided in the area, or provided by only a small
           number of Health Care Providers in the area, the Claims Administrator
           may take into account factors, such as (i) the complexity; (ii) the
           degree of skill needed; (iii) the type of specialty of the Health
           Care Provider; (iv) the range of services or supplies provided by a
           facility; and (v) the prevailing charge in other areas.

           When a Hospital or other facility is required to charge the DRG
           Amount for a service or supply, the DRG Amount will be considered the
           Reasonable Charge.

    11.60. Retiree.  A former Executive who was a member of this Plan maintained
           by the Company and who, while a member of this Plan,

           (A)  Terminated employment after attainment of age 62, or

           (B)  Retired at any time with an immediate retirement allowance from
                a retirement plan of the Company, or

           (C)  Retired with a disability retirement allowance from a retirement
                plan of the Company.

           Notwithstanding any contrary provision of the Plan, if a former
           Executive's Coverage is extended pursuant to the other provisions of
           the Plan, and if such former Executive is eligible to receive an
           immediate retirement allowance from a retirement plan of the Company
           and elects to have his retirement allowance commence no later than
           the day following the last day of such extended participation in the
           Plan, then such former Executive shall be deemed to be a Retiree for
           purposes of the Plan.

    11.61. Sickness.  For purposes of this Plan, any of the following, whether
           or not diagnosed, treated or requiring treatment: ill health,
           disease, pregnancy and bodily or mental infirmity or disorder
           including Mental Health Problems and Substance Dependency.  All
           Sicknesses which are due to the same cause or related causes shall be
           considered as one Sickness.

           Notwithstanding the foregoing, the term "Sickness" does not include
           any disease or other bodily or mental infirmity or disorder that
           arises out of or in the course of any work for pay or profit or
           results in any way from a disease that does.  A disease or other
           bodily

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<PAGE>
 
           or mental infirmity or disorder will be deemed not to arise out of
           work for pay or profit if the Covered Person provides proof that the
           Claims Administrator, in its discretion, determines to be sufficient
           evidence that the Covered Person is covered under any type of
           workers' compensation law and is not eligible to receive benefits for
           that disease, bodily or mental infirmity or disorder under such
           workers' compensation law.

    11.62. Skilled Nursing Care.  Services of a registered nurse or a licensed
           nurse that require the education, training and technical skills of a
           registered nurse or a licensed nurse, including the administration of
           oral medicines required by law to be dispensed by a registered or
           licensed nurse.  Skilled Nursing Care shall not include:

           (A)  The portion of any nursing care that does not require the
                education, training and technical skills of a registered nurse
                or a licensed nurse, including transportation, meal preparation,
                charting of vital signs or companionship activities;

           (B)  Private duty nursing care given while the person is an inpatient
                in a hospital or other health care facility;

           (C)  Care provided to help a person in the activities of daily life,
                such as bathing, feeding, personal grooming, dressing, getting
                in and out of bed or a chair, or toileting;

           (D)  Care provided solely for skilled observation except for care
                following the occurrence of (1) a change in medication of the
                Covered Person; (2) the need for Emergency medical services
                provided by a Physician or the onset of symptoms indicating the
                likely need for such services; (3) surgery or (4) release from
                inpatient confinement; or

           (E)  Any service provided solely to administer oral medicines, except
                where applicable law requires that such medicines be
                administered by a registered nurse or a licensed nurse.

    11.63. Spouse.  The Executive's or Retiree's legally qualified spouse as
           determined under the laws of the state in which the Executive or
           Retiree primarily resides while Covered.

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    11.64. Substance Dependency.  The current and habitual use of alcohol
           or one or more Controlled Substances or Illegal Drugs or such other
           substance as may be determined by the Claims Administrator, in its
           discretion.  "Controlled Substance" means a drug or substance listed
           in the Federal Controlled Substances Act and includes, but is not
           limited to, marijuana, hashish, heroin, cocaine, phencyclidine (PCP),
           benzodiazepines, narcotics, opiates, hallucinogens, inhalants and any
           other substances which have either a stimulant or depressant effect
           on the central nervous system, such as amphetamines or barbiturates.
           "Illegal Drug" means any drug which (i) is not legally obtainable,
           (ii) is legally obtainable but has not been legally obtained, or
           (iii) has been legally obtained but is not being used for prescribed
           purposes or in a prescribed manner.

    11.65. Surgical Services.  The professional services of the operating
           Physicians in performing a surgical procedure on a Covered Person,
           including related preoperative and post-operative care, and the
           administering of an anesthetic by the Physician.  A "surgical
           procedure" is any procedure in the following categories:

           (A)  Incision, excision, or electrocauterization of any part of the
                body.

           (B)  Manipulative reduction of a fracture or dislocation.

           (C)  Suturing of a wound.

           (D)  Endoscopic removal of a stone or foreign object from the larynx,
                bronchus, trachea, esophagus, stomach, urinary bladder, or
                ureter.

           (E)  An obstetrical procedure.

    11.66. Terminally Ill.  A medical prognosis of 6 months or less to live.

    11.67. Total Disability and/or Totally Disabled.  In the case of

           (A)  An Executive, his inability due to Injury or Sickness to engage
                in any occupation or employment for wages or profit, as
                determined in accordance with the provisions of the Company's
                Long-Term Disability Plan; and

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           (B)  A Dependent or Retiree, his inability due to Injury or Sickness
                to perform activities normal to persons of like age and sex in
                good health.

    11.68. Treatment Facility.  As the term applies to the treatment of
           Substance Dependency, an institution, or a distinct part of an
           institution, meeting all of the following tests:

           (A)  It is primarily engaged in providing, for compensation from its
                patients, a program for diagnosis, evaluation, and Effective
                Treatment of Substance Dependency.

           (B)  It provides all medical detoxification services on the premises,
                24 hours a day.

           (C)  It provides all normal infirmary-level medical services required
                for the treatment of any disease or Injury manifested during the
                treatment period, whether or not related to the Substance
                Dependency.  Also it provides, or has an agreement with a
                Hospital in the area to provide, any other medical services that
                may be required.

           (D)  At all times during the treatment period, it is under the
                continuous supervision of a staff of Physicians and it
                continuously provides skilled nursing services by licensed
                nursing personnel under the direction of a full-time registered
                graduate nurse.

           (E)  It prepares and maintains a written individual plan of treatment
                for each patient based on a diagnostic assessment of the
                patient's medical, psychological and social needs with
                documentation that the plan is under the supervision of a
                Physician.

           (F)  It meets any applicable licensing standards established by the
                jurisdiction in which it is located.

    11.69. Treatment of a Mental Health Problem.  Includes only treatment of a
           Mental Health Problem not related to, accompanying or resulting from
           the Covered Person's Substance Dependency.

                                       88