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                                    AMENDMENT
                                     TO THE
                              REINSURANCE AGREEMENT

                                      AMONG

Capitol Specialty Insurance Corporation (hereinafter referred to as the "Ceding
Company") and Darwin National Assurance Company (hereinafter referred to as
"Reinsurer").

WHEREAS, the parties desire to modify certain terms and conditions of the
Reinsurance Agreement between the parties dated July 1, 2005, as amended;

NOW, THEREFORE, for the consideration mentioned and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties do agree as follows:

      1.    Article 7(A) is hereby amended in its entirety as follows:

            On a monthly basis , during the term of this Reinsurance Agreement,
            there shall be transmitted by the Reinsurer to the Ceding Company,
            in form and substance mutually agreed upon by the parties, a
            "summary report" for the period reported on, of all activity
            relating to the Policy Liabilities. The report shall include, but
            not be limited to, the amount of gross premiums, commissions,
            related expenses, reserves and paid losses, as applicable. The
            report shall also reconcile any amounts due the Ceding Company and
            Reinsurer under this Reinsurance Agreement which shall include, but
            not be limited to, payment by Reinsurer to Ceding Company of any
            amounts related to any increase in total reserves (both case and
            incurred but not reported and notwithstanding the fact that Ceding
            Company may not yet have paid the associated claims) attributable to
            the Policies, and such amounts, including amounts related to any
            increase in reserves (both case and incurred but not reported and
            notwithstanding the fact that Ceding Company may not yet have paid
            the associated claims) shall be paid in accordance with Article 7(B)
            below.

      2.    Article 18 is hereby added in its entirety as follows:

                                   Article 18
                                Collateralization

            A. It is agreed that when the Ceding Company files with an insurance
            department or establishes reserves for claims covered and unearned
            premium and commissions related to Policies reinsured hereunder, as
            required by law, the Ceding Company shall forward to the Reinsurer a
            statement showing the proportion of such loss, Allocated Loss
            Adjustment

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            Expenses and unearned premium reserves which is applicable to the
            Reinsurer. In the event that the Ceding Company is not permitted by
            any insurance regulator to take full and complete credit on its
            financial statements for this reinsurance, and that the collateral
            provided by the reinsurer outlined in Article 18(B), below, shall
            not be satisfactory to an insurance regulator to take full and
            complete credit on its financial statements, then, the Reinsurer
            hereby agrees to apply for and secure delivery to the Ceding Company
            of a clean, irrevocable and unconditional Letter of Credit, that is
            issued, and presentable and payable in the United States by a bank
            or trust company that is a member of the Federal Reserve System, and
            is in a format acceptable to the governmental authority having
            jurisdiction over the Ceding Company's reserves, in an amount equal
            to the Reinsurer's proportion of such loss (including case and
            incurred but not reported), Allocated Loss Adjustment Expenses
            (including case and incurred but not reported), unearned premium and
            commission reserves. The Letter of Credit will be issued for a
            period of not less than one year, and will be automatically extended
            for one year from its date of expiration or any future expiration
            date unless 60 days prior to any expiration date the issuing bank
            notifies the Ceding Company by registered mail that the issuing bank
            elects not to consider the Letter of Credit extended for any
            additional period, in which case the Reinsurer shall deliver to the
            Ceding Company a replacement Letter of Credit on or prior to such
            expiration date. In lieu of the Letter of Credit described above,
            the Reinsurer may provide to the Ceding Company other collateral
            (such as cash advances, trust agreements, escrow accounts, or a
            combination of the foregoing) acceptable to the Ceding Company and
            to the governmental authority having jurisdiction over the Ceding
            Company's reserves.

            The Ceding Company and the Reinsurer agree that the Letter of Credit
            or other collateral provided by the Reinsurer under this provision
            may be drawn upon at any time, notwithstanding any other provisions
            in this Agreement by Ceding Company, including without limitation by
            any liquidator, rehabilitator, receiver or conservator of the Ceding
            Company for the following purposes:

            1)    to reimburse the Ceding Company for the Reinsurer's share of
                  the Policy Liabilities paid by the Ceding Company and which
                  has not otherwise been paid by the Reinsurer;

            2)    to reimburse the Ceding Company for the Reinsurer's share of
                  premium and commission returned under Policies reinsured under
                  this Agreement on account of cancellation of such Policies and
                  which has not otherwise been paid by the Reinsurer;

            3)    to fund an account with the Ceding Company in an amount at
                  least equal to the deduction, for reinsurance ceded, from the
                  Ceding Company's liabilities for amounts ceded under this
                  Agreement. Such cash deposits shall be held in an interest
                  bearing account separate from

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                  the Ceding Company's other assets, and interest thereon shall
                  accrue to the benefit of the Reinsurer. Such amount shall
                  include, but not be limited to, amounts for reserves for
                  claims and losses incurred, including losses incurred but not
                  reported, loss adjustment expenses, and unearned premiums;

            4)    to reimburse the Ceding Company insurer for the assuming
                  Reinsurer's share of surrenders and benefits or losses paid by
                  the Ceding Company under the terms and provisions of the
                  Policies reinsured under this Agreement; and

            5)    to pay any other amounts the Ceding Company claims are due
                  under this Agreement.

            B. In addition to any collateralization required as set forth in (A)
            above, upon the earliest to occur of (i) an IPO, (ii) a Strategic
            Sale or (iii) a Financial Sale (a "Collateralization Event"), all
            obligations of the Reinsurer to the Ceding Company (gross of any
            outside third party reinsurance which may be applicable), including
            but not limited to obligations related to the Policy Liabilities,
            loss reserves (case and incurred but not reported), unearned premium
            reserves and allocated loss adjustment expense reserves related to
            the Policies reinsured hereunder, must be fully collateralized
            pursuant to arrangements reasonably satisfactory to the Ceding
            Company. Such collateralization may, at Ceding Company's direction,
            include the provision by Reinsurer to Ceding Company of a clean,
            irrevocable and unconditional Letter of Credit having the same terms
            and which may be drawn upon for the same reasons as previously set
            forth above in this Article 18. The amount which must be fully
            collateralized in the event of a Collateralization Event will be
            recalculated every three (3) months following the occurrence of the
            Collateralization Event. In the event that, following a
            Collateralization Event, the actuaries for the Ceding Company and
            the actuaries for the Reinsurer disagree as to the appropriate level
            of reserves to be established in respect of such obligations of the
            Reinsurer, then the obligations of the Reinsurer will be
            collateralized at the level specified by the Ceding Company's
            actuaries or in the event of disagreement between Reinsurer and
            Ceding Company, the Reinsurer and the Ceding Company will mutually
            agree upon a nationally recognized independent actuarial firm to
            conduct an actuarial study of the obligations of the Reinsurer to
            the Ceding Company, the fees and expenses of which will be paid by
            the Reinsurer, and the obligations of the Reinsurer to the Ceding
            Company will be collateralized at the level specified by such third
            independent actuarial firm.

            For purposes of this Article 18, an "IPO" means the initial public
            offering of common stock of DPU or Reinsurer pursuant an effective
            registration statement under the Securities Act of 1933, as amended,
            in connection with which the common stock of DPU or Reinsurer
            becomes listed on a U.S. national securities exchange or traded on
            the Nasdaq National Market

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            System. For purposes of this Article 18, a "Strategic Sale" shall be
            defined as the sale by Alleghany Insurance Holdings LLC (hereinafter
            referred to as "AIHL") of securities representing a majority of the
            voting power in DPU (determined on an as-converted basis) and/or
            Reinsurer to an insurance company or an insurance holding company.
            For purposes of this Article 18, "Financial Sale" shall be
            determined as the sale by AIHL of securities to financial investors
            (i.e., investors which are not insurance companies or insurance
            holding companies) which would cause AIHL's voting interest in DPU
            (determined on an as-converted basis) and/or Reinsurer to drop below
            35%.

      3.    Article 19 is hereby added in its entirety as follows:

                                   Article 19
                            Reimbursement of Expenses

            Direct expenses incurred by the Ceding Company arising from the
            issuance of policies of the Ceding Company in respect of business
            produced by DPU will be reimbursed by Reinsurer to Ceding Company as
            follows:

<TABLE>
<CAPTION>
EXPENSE                          ALLOCATION OF METHODOLOGY
------------------------------   ----------------------------------------------
<S>                              <C>
Taxes/Boards/                    Reinsurer responsible for all taxes, boards
Bureaus                          and bureaus related to Policies.

Fines/Penalties                  Reinsurer responsible for all fines and
                                 penalties arising out of acts, errors or
                                 omissions of Reinsurer or its affiliates
                                 and/or related to the Policies.

Assessments                      Reinsurer responsible for all assessments
                                 (including, but not limited to, premium and
                                 loss based) to the extent they arise from
                                 or relate to Policies.

Market Conduct Exam Fees         Reinsurer responsible for exam fees related
                                 to regulatory review of DPU produced business
                                 and/or the reinsurance/underwriting management
                                 agreements implementing the Ceding
                                 Company/DPU/Reinsurer relationship.

Corporate Outside Counsel        Reinsurer responsible for all corporate
</TABLE>

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<TABLE>
<S>                              <C>

Fees Incurred  by the Company    outside counsel legal fees and expenses
(Company/DPU/                    incurred by the Ceding Company in connection
Reinsurance Transactions)        with regulatory matters related to Ceding
                                 Company/DPU/ Reinsurer transactions. The Ceding
                                 Company shall obtain Reinsurer's prior approval
                                 before incurring such legal fees in excess
                                 of $2,000 for any individual matter and
                                 such approval shall not be unreasonably
                                 withheld by Reinsurer.
</TABLE>

      4.    This Amendment may be executed in counterparts of like form, each of
            which, when executed, shall be deemed together an original and all
            of which taken together shall constitute one and the same
            instrument.

      5.    Except as hereby amended, the terms and provisions of the Agreement
            shall remain in full force and effect.

      6.    The parties hereby agree that the effective date for this Amendment
            shall be January 1, 2006.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
and delivered by their duly authorized representatives.

Darwin National Assurance Company    Capitol Specialty Insurance Corporation

By:   /s/ John L. Sennott, Jr.       By:   /s/ David Pauly
      ---------------------------          ------------------------------------

Name: John L. Sennott, Jr.           Name: David Pauly

Title: CFO                           Title: CEO