<PAGE>

                                                                    Exhibit 10.8

                         PHILADELPHIA INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA

                            PROPERTY THIRD AND FOURTH
                      EXCESS OF LOSS REINSURANCE AGREEMENT

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
ARTICLE                                                                     PAGE
-------                                                                     ----
<S>                                                                         <C>
I         BUSINESS COVERED (WBUS5)                                            1
II        TERM                                                                1
III       SPECIAL TERMINATION                                                 2
IV        DEFINITIONS                                                         3
             Building                                                         3
             Declaratory Judgment Expense (WDEF305)                           3
             Extra Contractual Obligations/Loss in Excess of Policy
             Limits (WDEF104)                                                 4
             Loss Adjustment Expense (WDEF307)                                4
             Loss Occurrence (NMA 2244/BRMA 27A)                              5
             Net Earned Premium                                               6
             Policy                                                           6
             Risk                                                             6
             Terrorism                                                        7
             Ultimate Net Loss                                                7
V         TERRITORY (BRMA 51A)                                                8
VI        EXCLUSIONS                                                          8
VII       COVERAGE                                                           10
VIII      REINSTATEMENT (WREN10)                                             11
IX        REINSURANCE PREMIUM (WRPR14)                                       12
X         NOTICE OF LOSS AND LOSS SETTLEMENTS                                12
XI        AGENCY AGREEMENT (WAGE1)                                           13
XII       SALVAGE AND SUBROGATION (WSAL1)                                    13
XIII      ERRORS AND OMISSIONS (BRMA 14C)                                    13
XIV       OFFSET                                                             14
XV        CURRENCY (BRMA 12A)                                                14
XVI       TAXES (BRMA 50C)                                                   14
XVII      FEDERAL EXCISE TAX (BRMA 17A)                                      14
XVIII     UNAUTHORIZED REINSURANCE (BRMA 55C)                                15
XIX       NET RETAINED LINES (BRMA 32E)                                      16
XX        TRIA INUREMENT                                                     17
XXI       SPECIAL ACCEPTANCES                                                17
XXII      MORTGAGEE REINSURANCE ENDORSEMENTS                                 18
</TABLE>

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<TABLE>
<S>                                                                         <C>
XXIII     THIRD PARTY RIGHTS (BRMA 52C MODIFIED)                             18
XXIV      SEVERABILITY (WSEV1)                                               19
XXV       GOVERNING LAW (BRMA 71A)                                           19
XXVI      ACCESS TO RECORDS (BRMA 1E)                                        19
XXVII     INSOLVENCY (WINS1)                                                 19
XXVIII    ARBITRATION (WARB1)                                                20
XXIX      SERVICE OF SUIT (WSOS4)                                            21
XXX       MODE OF EXECUTION (WMOE1)                                          23
XXXI      INTERMEDIARY (WINT8)                                               23

          Exhibit A
          Nuclear Incident Exclusion Clause - Physical Damage -
          Reinsurance - U.S.A.
          War Exclusion
</TABLE>

<PAGE>

                            PROPERTY THIRD AND FOURTH
                      EXCESS OF LOSS REINSURANCE AGREEMENT
                                (the "Contract")

                                     between

                         PHILADELPHIA INSURANCE COMPANY
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA
        And any additional company established or acquired by the Company
                                 (the "Company")

                                       and

                   THE SUBSCRIBING REINSURER(S) EXECUTING THE
                     INTERESTS AND LIABILITIES AGREEMENT(S)
                                 ATTACHED HERETO
                                (the "Reinsurer")

                                    ARTICLE I

BUSINESS COVERED (WBUS5)

By this Contract the Reinsurer agrees to reinsure the excess liability of the
Company under its Policies in force at the effective time and date hereof or
issued or renewed at or after that time and date, and classified by the Company
as Property and/or Inland Marine business, subject to the terms, conditions and
limitations hereafter set forth.

                                   ARTICLE II

TERM

A.   This Contract shall become effective at 12:01 a.m., Eastern Standard Time,
     January 1, 2006 as respects losses occurring at or after that time and
     date, and shall continue in effect until 12:01 a.m., Eastern Standard Time,
     January 1, 2007.

B.   Upon termination of this Contract, the entire liability of the Reinsurer
     for losses occurring subsequent to the date of termination shall cease
     concurrently with the date of termination of this Contract.

C.   Notwithstanding the above, the Company shall have the option to elect
     run-off coverage for Policies in force at the expiration of this Contract.
     If the Company chooses to run off


                                     Page 1

<PAGE>

     liability, the Company will notify the Reinsurer prior to January 31, 2007.
     If run-off of liability is chosen, the Reinsurer shall continue to be
     liable for Ultimate Net Loss incurred by the Company under all Policies in
     force at the time and date of expiration until each Policy's next
     anniversary, renewal or expiration, but in no event shall the Reinsurer's
     liability continue for more than 12 months after the expiration date plus
     odd time, not to exceed a total of 18 months. The premium for the run-off
     coverage shall be the "Premium Rate" for the excess layer, as stated in
     Exhibit A attached hereto, times its Net Earned Premium for the run-off
     period for the Policies in force as of December 31, 2006.

D.   If this Contract expires while a Loss Occurrence covered hereunder is in
     progress, the Reinsurer's liability hereunder shall, subject to the other
     terms and conditions of this Contract, be determined as if the entire Loss
     Occurrence had occurred prior to the expiration of this Contract, provided
     that no part of such Loss Occurrence is claimed against any renewal or
     replacement of this Contract.

                                   ARTICLE III

SPECIAL TERMINATION

A.   The Company may terminate this Contract at any time by the giving of 10
     days' notice in writing to the Reinsurer upon the happening of any one of
     the following circumstances:

     1.   A State Insurance Department or other legal authority orders the
          Reinsurer to cease writing business; or

     2.   The Reinsurer has become insolvent or has been placed into liquidation
          or receivership (whether voluntary or involuntary), or there has been
          instituted against it proceedings for the appointment of a receiver,
          liquidator, rehabilitator, conservator, trustee in bankruptcy or other
          agent known by whatever name, to take possession of its assets or
          control of its operations; or

     3.   The Reinsurer's policyholders' surplus has been reduced by whichever
          is greater, either 25% of the amount of surplus at the inception of
          this Contract or 25% of the amount at the latest anniversary, or has
          lost any part of, or has reduced its paid in capital; or

     4.   The Reinsurer has become merged with, acquired or controlled by any
          company, corporation or individual(s) not controlling the party's
          operations at the inception of this Contract; or

     5.   The Reinsurer has reinsured its entire liability under this Contract
          without the terminating party's prior written consent; or

     6.   The Reinsurer ceases writing new or renewal business.

     7.   The Reinsurer has been assigned an A.M. Best's rating of less than
          "A-" or a Standard & Poor's Insurer Financial Strength Rating of less
          than "A-".


                                     Page 2

<PAGE>

B.   Notwithstanding any other termination provision of this Contract, if this
     Contract is terminated under the provisions of this Article, the Company
     shall have the right to terminate liability for losses occurring subsequent
     to termination of this Contract. In such event, the Reinsurer shall return
     the unearned portion, if any, less any commission allowed thereon, of
     premiums paid hereunder and the minimum premium provisions, if any, shall
     be waived.

C.   Additionally, the Company, at its sole discretion, may elect to commute the
     Reinsurer's liabilities for loss and Loss Adjustment Expenses, whether
     known and unknown, on Policies covered under this Contract. In the event
     the Company and the Reinsurer cannot agree on the capitalized value of the
     Reinsurer's liabilities on the Policies covered under this Contract, the
     two parties shall mutually appoint an actuary to resolve the matter of
     valuation. If the two parties cannot agree on the appointment of an
     actuary, a selection process based on the ARBITRATION ARTICLE will be
     employed. Payment by the Reinsurer of the amount ascertained will
     constitute full and final release of the Reinsurer's liabilities hereunder.

D.   The Company may request special funding for any Reinsurer's participation
     if this Contract is terminated for reasons set forth in subparagraph A.1-7
     above. If the Company elects to exercise its special funding option, said
     Reinsurer will, within 30 calendar days of the date of the Company's
     request to do so, provide the Company with a cash advance, trust agreement,
     escrow account for the benefit of the Company, letter of credit, or a
     combination thereof acceptable to the Company to fund the Reinsurer's share
     of the reserves hereunder for losses (including loss and loss expense paid
     by the Company but not recovered from the Reinsurer, loss and loss expense
     reported and outstanding, loss and loss expenses incurred but not reported)
     and unearned premium, as if it were an unauthorized Reinsurer and subject
     to the UNAUTHORIZED REINSURANCE ARTICLE. This paragraph D shall not apply
     to Reinsurers who, at the inception of this Contract, have been assigned an
     A.M. Best's Financial Strength Rating of A+ or higher or a Standard &
     Poor's rating of A+ or higher or to Underwriting Members of Lloyd's,
     London.

                                   ARTICLE IV

DEFINITIONS

A.   Building

     "Building" as used herein shall mean such structure enclosed within
     exterior walls. Exterior walls are defined as walls constructed on the
     perimeter foundation, regardless of the number of additional structures or
     roofs placed upon this perimeter foundation.

B.   Declaratory Judgment Expense (WDEF305)

     "Declaratory Judgment Expense" as used herein shall mean all expenses
     incurred by the Company in connection with a declaratory judgment action
     brought to determine the Company's defense and/or indemnification
     obligations that are allocable to a specific claim subject to this
     Contract. Declaratory Judgment Expense shall be deemed to have been


                                     Page 3

<PAGE>

     incurred on the date of the original loss (if any) giving rise to the
     declaratory judgment action.

C.   Extra Contractual Obligations/Loss in Excess of Policy Limits (WDEF104)

     1.   Extra Contractual Obligations

          This Contract shall protect the Company for any "Extra Contractual
          Obligations" which as used herein shall mean any punitive, exemplary,
          compensatory or consequential damages, other than Loss in Excess of
          Policy Limits, paid or payable by the Company as a result of an action
          against it by its insured, its insured's assignee or a third party
          claimant, by reason of alleged or actual negligence, fraud or bad
          faith on the part of the Company in handling a claim under a Policy
          subject to this Contract.

          An Extra Contractual Obligation shall be deemed to have occurred on
          the same date as the loss covered or alleged to be covered under the
          Policy.

     2.   Loss in Excess of Policy Limits

          This Contract shall protect the Company for any "Loss in Excess of
          Policy Limits" which as used herein shall mean an amount that the
          Company would have been contractually liable to pay had it not been
          for the limit of the original Policy as a result of an action against
          it by its insured or its insured's assignee or a third party claimant.
          Such loss in excess of the limit shall have been incurred because of
          failure by the Company to settle within the Policy limit, or by reason
          of alleged or actual negligence, fraud, or bad faith in rejecting an
          offer of settlement or in the preparation of the defense or in the
          trial of any action against its insured or in the preparation or
          prosecution of an appeal consequent upon such action.

     3.   This paragraph C shall not apply where an Extra Contractual Obligation
          and/or Loss in Excess of Policy Limits has been incurred due to the
          fraud committed by a member of the Board of Directors or a corporate
          officer of the Company acting individually or collectively or in
          collusion with a member of the Board of Directors or a corporate
          officer or a partner of any other corporation or partnership.

     4.   Recoveries from any form of insurance or reinsurance which protects
          the Company against claims which are the subject matter of this
          paragraph C shall inure to the benefit of this Contract.

D.   Loss Adjustment Expense (WDEF307)

     "Loss Adjustment Expense" as used herein shall mean all costs and expenses
     allocable to a specific claim that are incurred by the Company in the
     investigation, appraisal, adjustment, settlement, litigation, defense or
     appeal of a specific claim, including court costs and costs of supersedeas
     and appeal bonds, and including 1) pre-judgment interest, unless included
     as part of the award or judgment; 2) post-judgment interest; 3) legal
     expenses and costs incurred in connection with coverage questions and legal
     actions connected thereto,


                                     Page 4

<PAGE>

     including Declaratory Judgment Expense; and 4) a pro rata share of salaries
     and expenses of Company field employees, and expenses of other Company
     employees who have been temporarily diverted from their normal and
     customary duties and assigned to the field adjustment of losses covered by
     this Contract. Loss Adjustment Expense does not include unallocated loss
     adjustment expense. Unallocated loss adjustment expense includes, but is
     not limited to, salaries and expenses of employees, other than (4) above,
     and office and other overhead expenses.

E.   Loss Occurrence (NMA 2244/BRMA 27A)

     1.   The term "Loss Occurrence" shall mean the sum of all individual losses
          directly occasioned by any one disaster, accident or loss or series of
          disasters, accidents or losses arising out of one event which occurs
          within the area of one state of the United States or province of
          Canada and states or provinces contiguous thereto and to one another.
          However, the duration and extent of any one "Loss Occurrence" shall be
          limited to all individual losses sustained by the Company occurring
          during any period of 168 consecutive hours arising out of and directly
          occasioned by the same event except that the term "Loss Occurrence"
          shall be further defined as follows:

          a.   As regards windstorm, hail, tornado, hurricane, cyclone,
               including ensuing collapse and water damage, all individual
               losses sustained by the Company occurring during any period of 72
               consecutive hours arising out of and directly occasioned by the
               same event. However, the event need not be limited to one state
               or province or states or provinces contiguous thereto.

          b.   As regards riot, riot attending a strike, civil commotion,
               vandalism and malicious mischief, all individual losses sustained
               by the Company occurring during any period of 72 consecutive
               hours within the area of one municipality or county and the
               municipalities or counties contiguous thereto arising out of and
               directly occasioned by the same event. The maximum duration of 72
               consecutive hours may be extended in respect of individual losses
               which occur beyond such 72 consecutive hours during the continued
               occupation of an assured's premises by strikers, provided such
               occupation commenced during the aforesaid period.

          c.   As regards earthquake (the epicenter of which need not
               necessarily be within the territorial confines referred to in the
               introductory portion of subparagraph 1) and fire following
               directly occasioned by the earthquake, only those individual fire
               losses which commence during the period of 168 consecutive hours
               may be included in the Company's "Loss Occurrence."

          d.   As regards "freeze," only individual losses directly occasioned
               by collapse, breakage of glass and water damage (caused by
               bursting of frozen pipes and tanks) may be included in the
               Company's "Loss Occurrence."

     2.   Except for those "Loss Occurrences" referred to in subparagraphs a and
          b above, the Company may choose the date and time when any such period
          of consecutive hours


                                     Page 5

<PAGE>

          commences provided that it is not earlier than the date and time of
          the occurrence of the first recorded individual loss sustained by the
          Company arising out of that disaster, accident or loss and provided
          that only one such period of 168 consecutive hours shall apply with
          respect to one event.

     3.   However, as respects those "Loss Occurrences" referred to in
          subparagraphs a and b above, if the disaster, accident or loss
          occasioned by the event is of greater duration than 72 consecutive
          hours, then the Company may divide that disaster, accident or loss
          into two or more "Loss Occurrences" provided no two periods overlap
          and no individual loss is included in more than one such period and
          provided that no period commences earlier than the date and time of
          the occurrence of the first recorded individual loss sustained by the
          Company arising out of that disaster, accident or loss.

     4.   No individual losses occasioned by an event that would be covered by
          72 hours clauses may be included in any "Loss Occurrence" claimed
          under the 168 hours provision.

F.   Net Earned Premium

     "Net Earned Premium" as used herein is defined as gross earned premium of
     the Company for the classes of business reinsured hereunder, less the
     earned portion of premiums ceded by the Company for reinsurance which
     inures to the benefit of this Contract.

G.   Policy

     "Policy" or "Policies" as used herein shall mean the Company's binders,
     policies and contracts providing insurance and reinsurance on the classes
     of business covered under this Contract.

H.   Risk

     "Risk" as used herein shall mean what constitutes one Risk as established
     by the Company at the time of acceptance, provided:

     1.   A building and its contents, regardless of the number of insureds or
          Policies involved, including time element coverages, shall never be
          considered more than one Risk.

     2.   When two or more Buildings and their contents, including time element
          coverages, are situated at the same General Location, the Company
          shall identify on its records at the time of acceptance by the Company
          those individual Buildings and their contents, including time element
          coverages, that are to be considered to constitute each Risk; if such
          identification is not made, each Building and its contents, including
          time element coverages, shall be considered to be a separate Risk.

     3.   When there are known and named extensions of coverage involving other
          risk locations (including but not limited to suppliers extensions,
          customer extensions and interdependencies and whether triggered by
          physical loss at the risk location or another location) that are
          included and formally recorded on the Company's records


                                     Page 6

<PAGE>

          at the time of acceptance of the Risk, all such known and named
          extensions of coverage shall be included in calculation of the one
          Risk.

I.   Terrorism

     "Terrorism" as used herein shall mean:

     1.   An activity, including the threat of an activity or any preparation
          for an activity, that (a) causes either (i) damage to property or (ii)
          injury to persons and (b) appears to be intended to: (i) intimidate or
          coerce a civilian population or (ii) disrupt any segment of an economy
          or (iii) influence the policy of a government by intimidation or
          coercion or (iv) affect the conduct of a government by destruction,
          assassination, kidnapping or hostage-taking or (v) advance a
          political, religious or ideological cause; provided, however, that an
          act of Terrorism for purposes of this definition shall not include any
          act or threat as described above perpetrated by an official, employee
          or agent of a foreign state acting for or on behalf of such state.

     2.   Any act authorized by a governmental authority for the purpose of
          preventing, terminating, countering or responding to any act or threat
          of terrorism or for the purpose of preventing or minimizing the
          consequences of any act or threat of Terrorism.

     3.   An activity that involves the use, release or escape of nuclear
          materials, or directly or indirectly results in nuclear reaction or
          radiation or radioactive contamination, and it appears that one
          purpose of the terrorism was to release such materials.

     4.   An activity that is carried out by means of the dispersal or
          application of pathogenic or poisonous biological or chemical
          materials or an activity where pathogenic or poisonous biological or
          chemical materials are released, and it appears that one purpose of
          the terrorism was to release such materials.

J.   Ultimate Net Loss

     The term "Ultimate Net Loss" shall mean the actual loss, including any
     pre-judgment interest which is included as part of the award or judgment,
     Loss Adjustment Expense, 100% of Loss in Excess of Policy Limits, and 100%
     of Extra Contractual Obligations, paid or to be paid by the Company on its
     net retained liability after making deductions for all recoveries,
     salvages, subrogations and all claims on inuring reinsurance, whether
     collectible or not; provided, however, that in the event of the insolvency
     of the Company, payment by the Reinsurer shall be made in accordance with
     the provisions of the INSOLVENCY ARTICLE. Nothing herein shall be construed
     to mean that losses under this Contract are not recoverable until the
     Company's Ultimate Net Loss has been ascertained.


                                     Page 7

<PAGE>

                                    ARTICLE V

TERRITORY (BRMA 51A)

The territorial limits of this Contract shall be identical with those of the
Company's Policies.

                                   ARTICLE VI

EXCLUSIONS

This Contract shall not apply to and specifically excludes the following:

A.   Reinsurance assumed by the Company other than reinsurance of primary
     business assumed from affiliated companies;

B.   Nuclear incident per the Nuclear Incident Exclusion Clause - Physical
     Damage - Reinsurance attached hereto;

C.   Self-insurance or self-insured obligations, howsoever styled, of the
     Company, its affiliates or subsidiaries, or any insurance wherein the
     Company, its affiliates or subsidiaries are named as the insured party,
     either alone or jointly with some other party, notwithstanding that no
     legal liability may arise in respect thereof by reason of the fact that the
     Company, its affiliates or subsidiaries, may not be obligated by law to pay
     a claim to itself, its affiliates or subsidiaries;

D.   Any loss or liability accruing to the Company directly or indirectly from
     any insurance written by or through any pool or association including pools
     or associations in which membership by the Company is required under any
     statutes or regulations;

E.   Any liability of the Company arising from its participation or membership
     in any insolvency fund;

F.   War per the attached "War Exclusion" attached hereto;

G.   Risks written on a layered basis, whether primary or excess of loss, or
     policies written with a deductible or franchise of more than $500,000;
     however, this exclusion shall not apply to policies which provide a
     percentage deductible or franchise in connection with windstorm, earthquake
     or flood;

H.   Pollution to the extent excluded in the Company's policies. Nevertheless,
     if the insured elects to purchase any "buy back" or additional coverage
     options, such options shall not be covered hereunder; however, this
     exclusion shall not apply:

     1.   When a judicial entity having legal jurisdiction invalidates the
          Company's Pollution exclusion, thereby obligating the Company for
          liability when such liability for Pollution was intended to be
          excluded by the Company's exclusion.


                                     Page 8

<PAGE>

     2.   In respect of any Policy written in a state whose insurance regulatory
          authorities have prohibited the Company from including a Pollution
          liability exclusion in its Policies.

I.   Insurance against earthquake, except when written in conjunction with fire
     and otherwise eligible perils;

J.   Insurance on growing crops;

K.   Insurance against flood, waves, tidal waves, overflow of any body of water,
     or their spray, all whether driven by wind or not, except when written in
     conjunction with fire and otherwise eligible perils;

L.   Business classified as fidelity, however this exclusion shall not apply to
     crime and fidelity with limits no greater than $2,000,000 when written as
     part of a package policy;

M.   Credit insurance;

N.   Business classified as boiler and machinery;

O.   Mortgage impairment insurance and similar kinds of insurance, howsoever
     styled, providing coverage to an insured with respect to its mortgagee
     interest in property or its owner interest in foreclosed property;

P.   Difference in conditions insurance and similar kinds of insurance,
     howsoever styled;

Q.   Any incident that involves the use, release or escape of pathogenic or
     poisonous biological or chemical materials or of nuclear materials, or to
     any incident that directly or indirectly results in nuclear reaction or
     radiation or radioactive contamination. However, this exclusion does not
     apply to the Terrorism Annual Aggregate Limit for the excess layer as
     stated in Exhibit A attached hereto.

R.   Losses with respect to overhead transmission and distribution lines and
     their supporting structures, other than those on or within 1,000 feet of
     the insured premises. However, public utilities extension and/or suppliers'
     extension and/or contingent business interruption coverage are not subject
     to this exclusion, provided these are not part of a transmitters' or
     distributors' policy.

S.   Offshore property Risks;

T.   Inland marine business with respect to the following:

     1.   Cargo insurance when written as such with respect to ocean vessels;

     2.   Faulty Film, tape, processing and editing insurance and cast
          insurance;

     3.   Drilling rigs for natural fuels;

     4.   Furriers' customers policies;


                                     Page 9

<PAGE>

     5.   Insurance on livestock under so-called "mortality policies";

     6.   Mining equipment while underground;

     7.   Registered mail and armored car insurance;

U.   Loss of, damage to, or failure of, or consequential loss resulting
     therewith (including but not limited to earnings and extra expense) of
     satellites, spacecraft, and launch vehicles, including cargo and freight
     carried therein, in all phases of operation (including but not limited to
     pre-launch, launch, and in-orbit).

V.   Mobile homes unless written as part of a commercial multiple peril policy.

W.   Watercraft, other than watercraft insured under a standard homeowners
     policy or when written as part of contents coverage under a commercial
     multiple peril policy.

If the Company is bound without knowledge of or contrary to the instructions of
the Company's supervisory underwriting personnel, or any business falling within
the scope of one or more of the exclusions set forth in this section, these
exclusions, except A, B, C, D, E, F, H, J, L, M, O, shall suspend with respect
to such business until 60 days after an underwriting supervisor of the Company
acquires knowledge of such business.

Should any judicial or regulatory entity having jurisdiction invalidate any
exclusion in the Company's Policy that is also the subject of one or more of the
exclusions herein, then a loss for which the Company is liable because of such
invalidation shall not be excluded hereunder.

                                   ARTICLE VII

COVERAGE

A.   As respects each excess layer hereunder, the Reinsurer shall be liable for
     the Ultimate Net Loss in excess of the "Company's Retention" for the excess
     layer, as stated in Exhibit A attached hereto, as respects each risk, each
     loss, subject to a limit of liability to the Reinsurer equal to the
     "Reinsurer's Limit, Each Risk, Each Loss" for the excess layer, as stated
     in Exhibit A attached hereto. The Reinsurer's liability in respect of any
     one Loss Occurrence shall not exceed the "Reinsurer's Limit, Each Loss
     Occurrence" for the excess layer, as stated in Exhibit A attached hereto,
     nor shall it exceed the "Reinsurer's Limit, All Risks, All Losses" for the
     excess layer, as stated in Exhibit A attached hereto, in respect of all
     losses occurring during the term of this Contract. The Reinsurer's
     liability in respect to Terrorism losses shall not exceed the "Terrorism
     Annual Aggregate Limit" for the excess layer, as stated in Exhibit A
     attached hereto.

B.   The Company shall maintain in force other reinsurance, recoveries under
     which shall inure to the benefit of this Contract.


                                     Page 10

<PAGE>

C.   The Company shall be permitted to carry underlying reinsurance, recoveries
     under which shall inure solely to the benefit of the Company and be
     entirely disregarded in applying all of the provisions of this Contract.

                                  ARTICLE VIII

REINSTATEMENT (WREN10)

A.   As respects each excess layer hereunder, should all or any part of the
     Reinsurer's limit of liability for the excess layer be exhausted as a
     result of a loss, the sum so exhausted shall be reinstated from the date
     the loss commenced.

B.   Except as otherwise provided below, for each amount so reinstated for the
     excess layer, the Company agrees to pay to the Reinsurer an additional
     premium ("reinstatement premium") calculated in accordance with the
     following formula which amount(s) shall be paid to the Reinsurer at the
     time of the Reinsurer's payment of the loss.

     1.   AS RESPECTS THE THIRD EXCESS LAYER

          a.   The percentage of the "Reinsurer's Limit, Each Risk, Each Loss,"
               as stated in Exhibit A, exhausted for the Third Excess Layer
               shall be automatically reinstated without payment of any
               "reinstatement premium" up to an additional limit of 1 times the
               amount of the "Reinsurer's Limit, Each Risk, Each Loss," as
               stated in Exhibit A attached hereto.

          b.   For each additional reinstatement thereafter the Company agrees
               to pay a "reinstatement premium" calculated in accordance with
               the following formula:

               (i)  The percentage of the "Reinsurer's Limit, Each Risk, Each
                    Loss," as stated in Exhibit A, exhausted for the Third
                    Excess Layer;

               (ii) The reinsurance premium paid or payable for the Third Excess
                    Layer for the term of this Contract.

               The dollar amount resulting from the multiplication of
               subparagraphs b.(i) and b.(ii), above, shall equal the
               "reinstatement premium" for the excess layer. If, at the time of
               the Reinsurer's payment of a loss hereon, the reinsurance premium
               for the Third Excess layer as calculated under this Contract is
               unknown, the calculation of the reinstatement premium shall be
               based upon the deposit premium for the excess layer subject to
               adjustment when the reinsurance premium is finally established.

     2.   AS RESPECTS THE FOURTH EXCESS LAYER

          For each amount so reinstated for the Fourth Excess Layer, the Company
          agrees to pay an additional premium at the time of the Reinsurer's
          payment of the loss calculated in accordance with the following
          formula:


                                     Page 11

<PAGE>

          a.   The percentage of the "Reinsurer's Limit, Each Risk, Each Loss"
               for the excess layer, as stated in Exhibit A attached hereto,
               exhausted for the loss.

          b.   The reinsurance premium paid or payable for the excess layer for
               the term of this Contract.

          The dollar amount resulting from the multiplication of subparagraphs a
          and b above shall equal the reinstatement premium for the excess
          layer. If at the time of the Reinsurer's payment of a loss hereon, the
          reinsurance premium Fourth Excess Layer as calculated under this
          Contract is unknown, the calculation of the reinstatement premium
          shall be based upon the deposit premium for the excess layer subject
          to adjustment when the reinsurance premium is finally established.

C.   Nevertheless, the Reinsurer's liability hereunder shall not exceed the
     "Reinsurer's Limit, Each Risk, Each Loss" for the excess layer, as stated
     in Exhibit A attached hereto, in respect of any one loss, and shall be
     further limited to the "Reinsurer's Limit, Each Loss Occurrence" for the
     excess layer, as stated in Exhibit A attached hereto, in respect of any one
     Loss Occurrence, and shall be further limited to the "Reinsurer's Limit,
     All Loss Occurrences" for the excess layer as stated in Exhibit A attached
     hereto, in respect of all losses occurring during the term of this
     Contract.

                                   ARTICLE IX

REINSURANCE PREMIUM (WRPR14)

A.   As premium for the reinsurance provided hereunder for each excess layer,
     the Company shall pay the Reinsurer the "Premium Rate" for the excess
     layer, as stated in Exhibit A attached hereto, times its Net Earned Premium
     for the term of this Contract.

B.   The Company shall pay the Reinsurer the "Minimum and Deposit Premium" for
     the excess layer, as stated in Exhibit A attached hereto, in "Quarterly
     Installments," as stated in Exhibit A attached hereto, on April 1; July 1;
     and October 1, 2006; and January 1, 2007.

C.   Within 90 days after the expiration of this Contract, the Company shall
     provide a report to the Reinsurer setting forth the premium due hereunder
     for each excess layer, computed in accordance with paragraph A, and if the
     premium so computed is greater than the previously paid "Minimum and
     Deposit Premium" for the excess layer, as stated in Exhibit A attached
     hereto, the balance shall be remitted by the Company with its report.

                                    ARTICLE X

NOTICE OF LOSS AND LOSS SETTLEMENTS

A.   The Company shall advise the Reinsurer promptly of all losses which, in the
     opinion of the Company, may result in a claim hereunder and of all
     subsequent developments thereto which, in the opinion of the Company, may
     materially affect the position of the Reinsurer.


                                     Page 12

<PAGE>

B.   When so requested in writing, the Company shall afford the Reinsurer or its
     representatives an opportunity to be associated with the Company, at the
     expense of the Reinsurer, in the defense of any claim, suit or proceeding
     involving this reinsurance, and the Company and the Reinsurer shall
     cooperate in every respect in the defense of such claim, suit or
     proceeding.

C.   All loss settlements made by the Company that are within the terms and
     conditions of the Policy or by way of compromise, and except as otherwise
     provided in this Contract, shall be binding upon the Reinsurer. Upon
     receipt of satisfactory proof of loss and within no more than 25 days of
     receipt of the proof of loss, the Reinsurer agrees to pay or allow, as the
     case may be, its share of each such settlement in accordance with this
     Contract.

D.   Ex-gratia payments shall be recoverable hereunder only where the Company,
     through written communication prior to settlement, counsels with the
     Reinsurer and the Reinsurer concurs, in writing, with the settlement
     proposed by the Company.

                                   ARTICLE XI

AGENCY AGREEMENT (WAGE1)

If more than one reinsured company is named as a party to this Contract, the
first named company will be deemed the agent of the other reinsured companies
for purposes of sending or receiving notices required by the terms and
conditions of this Contract and for purposes of remitting or receiving any
monies due any party.

                                   ARTICLE XII

SALVAGE AND SUBROGATION (WSAL1)

The Reinsurer shall be credited with salvage or subrogation recoveries (i.e.,
reimbursement obtained or recovery made by the Company, less Loss Adjustment
Expense incurred in obtaining such reimbursement or making such recovery) on
account of claims and settlements involving reinsurance hereunder. Salvage and
subrogation recoveries thereon shall always be used to reimburse the excess
carriers in the reverse order of their priority according to their participation
before being used in any way to reimburse the Company for its primary loss. The
Company hereby agrees to enforce its rights to salvage or subrogation relating
to any loss, a part of which loss was sustained by the Reinsurer, and to
prosecute all claims arising out of such rights.


                                     Page 13

<PAGE>

                                  ARTICLE XIII

ERRORS AND OMISSIONS (BRMA 14C)

Any inadvertent delay, omission or error shall not be held to relieve either
party hereto from any liability which would attach to it hereunder if such
delay, omission or error had not been made, provided such omission or error is
rectified upon discovery.

                                   ARTICLE XIV

OFFSET

The Company and the Reinsurer may offset any balance, whether on account of
premium, commission, claims or losses, Loss Adjustment Expense, salvage, or
otherwise, due from one party to the other under the terms of this Contract or
under any other agreement heretofore or hereafter entered into between the
Company and the Reinsurer.

                                   ARTICLE XV

CURRENCY (BRMA 12A)

A.   Whenever the word "Dollars" or the "$" sign appears in this Contract, they
     shall be construed to mean United States Dollars and all transactions under
     this Contract shall be in United States Dollars.

B.   Amounts paid or received by the Company in any other currency shall be
     converted to United States Dollars at the rate of exchange at the date such
     transaction is entered on the books of the Company.

                                   ARTICLE XVI

TAXES (BRMA 50C)

In consideration of the terms under which this Contract is issued, the Company
will not claim a deduction in respect of the premium hereon when making tax
returns, other than income or profits tax returns, to any state or territory of
the United States of America, the District of Columbia or Canada.

                                  ARTICLE XVII

FEDERAL EXCISE TAX (BRMA 17A)

(Applicable to those subscribing reinsurers, excepting Underwriters at Lloyd's
London and other subscribing reinsurers exempt from Federal Excise Tax, who are
domiciled outside the United States of America.)


                                     Page 14

<PAGE>

A.   The subscribing reinsurer has agreed to allow for the purpose of paying the
     Federal Excise Tax the applicable percentage of the premium payable hereon
     (as imposed under Section 4371 of the Internal Revenue Code) to the extent
     such premium is subject to the Federal Excise Tax.

B.   In the event of any return of premium becoming due hereunder the
     subscribing reinsurer will deduct the applicable percentage from the return
     premium payable hereon and the Company or its agent should take steps to
     recover the tax from the United States Government.

                                  ARTICLE XVIII

UNAUTHORIZED REINSURANCE (BRMA 55C)

(Applies only to a subscribing reinsurer who does not qualify for full credit
with any insurance regulatory authority having jurisdiction over the Company's
reserves.)

A.   As regards Policies or bonds issued by the Company coming within the scope
     of this Contract, the Company agrees that when it shall file with the
     insurance regulatory authority or set up on its books reserves for losses
     covered hereunder which it shall be required by law to set up, it will
     forward to the subscribing reinsurer a statement showing the proportion of
     such reserves which is applicable to the subscribing reinsurer. The
     subscribing reinsurer hereby agrees to fund such reserves in respect of
     known outstanding losses that have been reported to the subscribing
     reinsurer and allocated Loss Adjustment Expense relating thereto, losses
     and allocated Loss Adjustment Expense paid by the Company but not recovered
     from the subscribing reinsurer, plus reserves for losses incurred but not
     reported, as shown in the statement prepared by the Company (hereinafter
     referred to as "subscribing reinsurer's obligations") by funds withheld,
     cash advances or a Letter of Credit. The subscribing reinsurer shall have
     the option of determining the method of funding provided it is acceptable
     to the insurance regulatory authorities having jurisdiction over the
     Company's reserves.

B.   When funding by a Letter of Credit, the subscribing reinsurer agrees to
     apply for and secure timely delivery to the Company of a clean, irrevocable
     and unconditional Letter of Credit issued by a bank and containing
     provisions acceptable to the insurance regulatory authorities having
     jurisdiction over the Company's reserves in an amount equal to the
     subscribing reinsurer's proportion of said reserves. Such Letter of Credit
     shall be issued for a period of not less than one year, and shall be
     automatically extended for one year from its date of expiration or any
     future expiration date unless 30 days (60 days where required by insurance
     regulatory authorities) prior to any expiration date the issuing bank shall
     notify the Company by certified or registered mail that the issuing bank
     elects not to consider the Letter of Credit extended for any additional
     period.

C.   The subscribing reinsurer and Company agree that the Letters of Credit
     provided by the subscribing reinsurer pursuant to the provisions of this
     Contract may be drawn upon at any time, notwithstanding any other provision
     of this Contract, and be utilized by the Company or any successor, by
     operation of law, of the Company including, without limitation, any


                                     Page 15

<PAGE>

     liquidator, rehabilitator, receiver or conservator of the Company for the
     following purposes, unless otherwise provided for in a separate Trust
     Agreement:

     1.   To reimburse the Company for the subscribing reinsurer's obligations,
          the payment of which is due under the terms of this Contract and which
          has not been otherwise paid;

     2.   To make refund of any sum which is in excess of the actual amount
          required to pay the subscribing reinsurer's obligations under this
          Contract;

     3.   To fund an account with the Company for the subscribing reinsurer's
          obligations. Such cash deposit shall be held in an interest bearing
          account separate from the Company's other assets, and interest thereon
          not in excess of the prime rate shall accrue to the benefit of the
          subscribing reinsurer;

     4.   To pay the subscribing reinsurer's share of any other amounts the
          Company claims are due under this Contract.

     In the event the amount drawn by the Company on any Letter of Credit is in
     excess of the actual amount required for subparagraph 1 or 3, or in the
     case of subparagraph 4, the actual amount determined to be due, the Company
     shall promptly return to the subscribing reinsurer the excess amount so
     drawn. All of the foregoing shall be applied without diminution because of
     insolvency on the part of the Company or the subscribing reinsurer.

D.   The issuing bank shall have no responsibility whatsoever in connection with
     the propriety of withdrawals made by the Company or the disposition of
     funds withdrawn, except to ensure that withdrawals are made only upon the
     order of properly authorized representatives of the Company.

E.   At annual intervals, or more frequently as agreed but never more frequently
     than quarterly, the Company shall prepare a specific statement of the
     subscribing reinsurer's obligations, for the sole purpose of amending the
     Letter of Credit, in the following manner:

     1.   If the statement shows that the subscribing reinsurer's obligations
          exceed the balance of credit as of the statement date, the subscribing
          reinsurer shall, within 30 days after receipt of notice of such
          excess, secure delivery to the Company of an amendment to the Letter
          of Credit increasing the amount of credit by the amount of such
          difference.

     2.   If, however, the statement shows that the subscribing reinsurer's
          obligations are less than the balance of credit as of the statement
          date, the Company shall, within 30 days after receipt of written
          request from the subscribing reinsurer, release such excess credit by
          agreeing to secure an amendment to the Letter of Credit reducing the
          amount of credit available by the amount of such excess credit.


                                     Page 16

<PAGE>

                                   ARTICLE XIX

NET RETAINED LINES (BRMA 32E)

A.   This Contract applies only to that portion of any Policy which the Company
     retains net for its own account (prior to deduction of any underlying
     reinsurance specifically permitted in this Contract), and in calculating
     the amount of any loss hereunder and also in computing the amount or
     amounts in excess of which this Contract attaches, only loss or losses in
     respect of that portion of any Policy which the Company retains net for its
     own account shall be included.

B.   The amount of the Reinsurer's liability hereunder in respect of any loss or
     losses shall not be increased by reason of the inability of the Company to
     collect from any other reinsurer(s), whether specific or general, any
     amounts which may have become due from such reinsurer(s), whether such
     inability arises from the insolvency of such other reinsurer(s) or
     otherwise.

C.   As respects the Fourth Excess layer of this Contract, any recoveries under
     the Third Excess layer of this Contract shall be disregarded and shall
     inure to the sole benefit of the Company.

                                   ARTICLE XX

TRIA INUREMENT

A.   As respects any "insured loss," as defined in the Terrorism Risk Insurance
     Act of 2002 ("TRIA"), for which the Reinsurer makes a payment to the
     Company under this Contract, the following provisions shall apply.

B.   If the sum of

     1.   Financial assistance provided under TRIA to the Company and its
          affiliates, if any, (as "affiliate" is defined in TRIA) with respect
          to all "insured loss" that applies to each "program year," as defined
          in TRIA and

     2.   Amounts due from all reinsurance which the Company and its affiliates,
          if any, purchase, including but not limited to this reinsurance, all
          other treaty reinsurance and all facultative reinsurance, and whether
          collectible or not, under which there is a recoverable for any such
          "insured loss"

     exceeds the amount of the Company's and its affiliates', if any, gross
     "insured loss," the excess amount shall be allocated to the Reinsurer in
     the ratio that the Reinsurer's liability for the "insured loss" under this
     Contract bears to the total collectible reinsurance recoverables for the
     "insured loss" under 2 above.


                                     Page 17

<PAGE>

C.   Upon receipt of payment under TRIA by the Company and its affiliates, if
     any, the Company shall pay to or credit the Reinsurer under this Contract
     with the Reinsurer's share of such excess amount determined in accordance
     with the preceding paragraph.

                                   ARTICLE XXI

SPECIAL ACCEPTANCES

A.   Business not within the terms of this Contract may be submitted to the
     Reinsurer for special acceptance and, if accepted by the Reinsurer, shall
     be subject to all of the terms of this Contract, except as modified by the
     Special Acceptance.

B.   Renewal of Policies, which have previously received a Special Acceptance
     under prior Contracts, are deemed to be covered hereunder.

C.   Further, should a reinsurer become party to this Contract subsequent to the
     acceptance of any business not normally covered hereunder, that reinsurers
     will automatically accept the special acceptances as being part of this
     Contract.

                                  ARTICLE XXII

MORTGAGEE REINSURANCE ENDORSEMENTS

A.   To induce a mortgagee named in a policy of the Company to accept such
     policy, the Company and the Reinsurer may agree to name such mortgagee as a
     third party beneficiary in a Mortgagee Reinsurance Endorsement made a part
     of this Contract. For each such mortgagee Reinsurance Endorsement so
     issued, the Company shall indemnify the Reinsurer for any and all
     liability, loss, cost, or expense the Reinsurer may sustain or incur in
     excess of its obligations under this Contract by reason of the issuance of
     such Mortgagee Reinsurance Endorsement.

B.   If the Reinsurer becomes liable to a mortgagee under any Mortgagee
     Reinsurance Endorsement, the Reinsurer shall, to the extent of its
     liability:

     1.   Benefit pro-rata in reductions of the Company's loss by salvage,
          subrogation, compromise, or otherwise.

     2.   Be automatically subrogated to all of the mortgagee's rights against
          the Company under the policy.

     3.   Be completely discharged from its obligation to make any payment to
          the Company under this Contract and be entitled to set off against any
          amount due from the Reinsurer to the Company under this or any other
          agreement for any amounts for which the Reinsurer would not be liable
          except for the existence of such Mortgagee Reinsurance Endorsement.


                                     Page 18

<PAGE>

C.   The Reinsurer shall have the right to cancel any Mortgagee Reinsurance
     Endorsement by notice to the mortgagee.

D.   Prior to the termination date, the Company shall advise the Reinsurer as to
     which of the above options shall apply.

                                  ARTICLE XXIII

THIRD PARTY RIGHTS (BRMA 52C MODIFIED)

Except for the provisions of the MORTGAGEE REINSURANCE ENDORSEMENTS ARTICLE,
this Contract is solely between the Company and the Reinsurer, and in no
instance shall any other party have any rights under this Contract except as
expressly provided otherwise in the INSOLVENCY ARTICLE.

                                  ARTICLE XXIV

SEVERABILITY (WSEV1)

If any provision of this Contract shall be rendered illegal or unenforceable by
the laws or regulations of any state, such provision shall be considered void in
such state, but this shall not affect the validity or enforceability of any
other provision of this Contract or the enforceability of such provision in any
other jurisdiction.

                                   ARTICLE XXV

GOVERNING LAW (BRMA 71A)

This Contract shall be governed as to performance, administration and
interpretation by the laws of the State of Pennsylvania exclusive of that
state's rules with respect to conflicts of law, except as to rules with respect
to credit for reinsurance in which case the applicable rules of all states shall
apply.

                                  ARTICLE XXVI

ACCESS TO RECORDS (BRMA 1E)

The Reinsurer or its designated representatives shall have access to the books
and records of the Company on matters relating to this reinsurance at all
reasonable times for the purpose of obtaining information concerning this
Contract or the subject matter hereof.


                                     Page 19

<PAGE>

                                  ARTICLE XXVII

INSOLVENCY (WINS1)

A.   In the event of the insolvency of the Company, this reinsurance shall be
     payable directly to the Company or to its liquidator, receiver, conservator
     or statutory successor, with reasonable provision for verification, on the
     basis of the liability of the Company without diminution because of the
     insolvency of the Company or because the liquidator, receiver, conservator
     or statutory successor of the Company has failed to pay all or a portion of
     any claim. It is agreed, however, that the liquidator, receiver,
     conservator or statutory successor of the Company shall give written notice
     to the Reinsurer of the pendency of a claim against the Company indicating
     the Policy or bond reinsured which claim would involve a possible liability
     on the part of the Reinsurer within a reasonable time after such claim is
     filed in the conservation or liquidation proceeding or in the receivership,
     and that during the pendency of such claim, the Reinsurer may investigate
     such claim and interpose, at its own expense, in the proceeding where such
     claim is to be adjudicated, any defense or defenses that it may deem
     available to the Company or its liquidator, receiver, conservator or
     statutory successor. The expense thus incurred by the Reinsurer shall be
     chargeable, subject to the approval of the Court, against the Company as
     part of the expense of conservation or liquidation to the extent of a
     proportionate share of the benefit which may accrue to the Company solely
     as a result of the defense undertaken by the Reinsurer.

B.   Where two or more subscribing reinsurers are involved in the same claim and
     a majority in interest elect to interpose defense to such claim, the
     expense shall be apportioned in accordance with the terms of this Contract
     as though such expense had been incurred by the Company.

C.   It is further agreed that, in the event of the insolvency of the Company,
     the reinsurance under this Contract shall be payable directly by the
     Reinsurer to the Company or its liquidator, receiver, conservator, or
     statutory successor, except as provided by Section 4118(a) of the New York
     Insurance Law or except (1) where this Contract specifically provides
     another payee of such reinsurance in the event of the insolvency of the
     Company or (2) where the Reinsurer with the consent of the direct insured
     or insureds has assumed such Policy obligations of the Company as direct
     obligations of the Reinsurer to the payee under such Policies and in
     substitution for the obligations of the Company to such payees.

D.   In the event of the insolvency of any company or companies listed in the
     designation of "Company" under this Contract, this Article shall apply only
     to the insolvent company or companies.

                                 ARTICLE XXVIII

ARBITRATION (WARB1)

A.   As a condition precedent to any right of action hereunder, any
     irreconcilable dispute arising out of the interpretation, performance or
     breach of this Contract, including the formation or


                                     Page 20

<PAGE>

     validity thereof, whether arising before or after the expiry or termination
     of the Contract, shall be submitted for decision to a panel of 3
     arbitrators. Notice requesting arbitration will be in writing and sent by
     certified mail, return receipt requested, or such reputable courier service
     as is capable of returning proof of receipt of such notice by the recipient
     to the party demanding arbitration.

B.   One arbitrator shall be appointed by each party. If either party fails to
     appoint its arbitrator within 30 days after being requested to do so by the
     other party, the latter, after 10 days notice by certified mail or
     reputable courier as provided above of its intention to do so, may appoint
     the second arbitrator.

C.   The two arbitrators shall, before instituting the hearing, appoint an
     impartial third arbitrator who shall preside at the hearing. If the 2
     arbitrators are unable to agree upon the third arbitrator within 30 days of
     their appointment, the Company shall petition the American Arbitration
     Association to appoint the third arbitrator. If the American Arbitration
     Association fails to appoint the third arbitrator within 30 days of being
     requested to do so, either party may request a district court judge of the
     federal district court having jurisdiction over the geographical area in
     which the arbitration is to take place, or if the federal court declines to
     act, the state court having general jurisdiction in such area to select the
     third arbitrator from a list of 6 individuals (3 named by each arbitrator
     previously appointed). All arbitrators shall be disinterested active or
     former senior executives of insurance or reinsurance companies or
     Underwriters at Lloyd's, London.

D.   Within 30 days after notice of appointment of all arbitrators, the panel
     shall meet and determine timely periods for briefs, discovery procedures
     and schedules for hearings. The panel shall be relieved of all judicial
     formality and shall not be bound by the strict rules of procedure and
     evidence. Unless the panel agrees otherwise, arbitration shall take place
     in Bala Cynwyd, Pennsylvania, but the venue may be changed when deemed by
     the panel to be in the best interest of the arbitration proceeding. Insofar
     as the arbitration panel looks to substantive law, it shall consider the
     law of the State of Pennsylvania. The decision of any 2 arbitrators when
     rendered in writing shall be final and binding. The panel is empowered to
     grant interim relief as it may deem appropriate.

E.   The panel shall make its decision considering the custom and practice of
     the applicable insurance and reinsurance business as promptly as possible
     following the termination of the hearings. Judgment upon the award may be
     entered in any court having jurisdiction thereof.

F.   If more than one subscribing reinsurer is involved in arbitration where
     there are common questions of law or fact and a possibility of conflicting
     awards or inconsistent results, all such subscribing reinsurers shall
     constitute and act as one party for purposes of this Article and
     communications shall be made by the Company to each of the subscribing
     reinsurers constituting the one party; provided, however, that nothing
     therein shall impair the rights of such subscribing reinsurers to assert
     several, rather than joint defenses or claims, nor be construed as changing
     the liability of the subscribing reinsurers under the terms of this
     Contract from several to joint.


                                     Page 21

<PAGE>

G.   Each party shall bear the expense of its own arbitrator and shall jointly
     and equally bear with the other party the cost of the third arbitrator. The
     remaining costs of the arbitration shall be allocated by the panel. The
     panel may, at its discretion, award such further costs and expenses as it
     considers appropriate, including but not limited to attorneys fees, to the
     extent permitted by law. However, the panel may not award any exemplary or
     punitive damages.

                                  ARTICLE XXIX

SERVICE OF SUIT (WSOS4)

(This Article is applicable if the subscribing reinsurer is not domiciled in the
United States of America and/or is not authorized in any State, Territory or
District of the United States where authorization is required by insurance
regulatory authorities. This Article is not intended to conflict with or
override the obligation of the parties to arbitrate their disputes in accordance
with the ARBITRATION ARTICLE.)

A.   In the event of the failure of the subscribing reinsurer to pay any amount
     claimed to be due hereunder, the subscribing reinsurer, at the request of
     the Company, shall submit to the jurisdiction of a court of competent
     jurisdiction within the United States. Nothing in this Article constitutes
     or should be understood to constitute a waiver of the subscribing
     reinsurer's rights to commence an action in any court of competent
     jurisdiction in the United States, to remove an action to a United States
     District Court, or to seek a transfer of a case to another court as
     permitted by the laws of the United States or of any state in the United
     States. The subscribing reinsurer, once the appropriate court is selected,
     whether such court is the one originally chosen by the Company and accepted
     by subscribing reinsurer or is determined by removal, transfer, or
     otherwise, as provided for above, shall comply with all requirements
     necessary to give said court jurisdiction and, in any suit instituted
     against it upon this Contract, shall abide by the final decision of such
     court or of any appellate court in the event of an appeal.

B.   Service of process in such suit may be made upon the agent for the service
     of process ("agent") named below, depending on the jurisdiction where the
     Company chooses to bring suit:

     1.   If the suit is brought in the State of California, the law firm of
          Mendes and Mount, 725 South Figueroa, 19th Floor, Los Angeles,
          California 90017 shall be authorized and directed to accept service of
          process on behalf of the subscribing reinsurer in any such suit;

     2.   If the suit is brought in the State of New York, the law firm of
          Mendes and Mount, 750 Seventh Avenue, New York, New York 10019 shall
          be authorized and directed to accept service of process on behalf of
          the subscribing reinsurer in any such suit;

     3.   If the suit is brought in any state other than California or New York,
          either of the agents described in subparagraphs 1 or 2 above shall be
          authorized and directed to accept service of process on behalf of the
          subscribing reinsurer in any such suit; or


                                     Page 22

<PAGE>

     4.   If the subscribing reinsurer has designated an agent in the
          subscribing reinsurer's Interests and Liabilities Agreement attached
          hereto, then that agent shall be authorized and directed to accept
          service of process on behalf of the subscribing reinsurer in any suit.
          However, if an agent is designated in the subscribing reinsurer's
          Interests and Liabilities Agreement and the agent is not located in
          California as respects a suit brought in California or New York as
          respects a suit brought in New York, in keeping with the laws of the
          states of California and New York which require that service be made
          on an agent located in the respective state if a suit is brought in
          that state, the applicable office of Mendes and Mount stipulated in
          subparagraphs 1 and 2 above must be used for service of suit unless
          the provisions of paragraph C of this Article apply.

C.   Further, pursuant to any statute of any state, territory or district of the
     United States that makes provision therefor, the subscribing reinsurer
     hereby designates the Superintendent, Commissioner or Director of
     Insurance, or other officer specified for that purpose in the statute, or
     his successor or successors in office, as its true and lawful attorney upon
     whom may be served any lawful process in any action, suit or proceedings
     instituted by or on behalf of the Company or any beneficiary hereunder
     arising out of this Contract, and hereby designates the above-named as the
     person to whom the said officer is authorized to mail such process or a
     true copy thereof.

                                   ARTICLE XXX

MODE OF EXECUTION (WMOE1)

This Contract may be executed either by an original written ink signature of
paper documents, by an exchange of facsimile copies showing the original written
ink signature of paper documents, or by electronic signature by either party
employing appropriate software technology as to satisfy the parties at the time
of execution that the version of the document agreed to by each party shall
always be capable of authentication and satisfy the same rules of evidence as
written signatures. The use of any one or a combination of these methods of
execution shall constitute a legally binding and valid signing of this Contract.
This Contract may be executed in one or more counterparts, each of which, when
duly executed, shall be deemed an original.

                                  ARTICLE XXXI

INTERMEDIARY (WINT8)

Willis Re Inc., 1835 Market Street, Suite 2700, Philadelphia, Pennsylvania 19103
is hereby recognized as the intermediary negotiating this Contract and through
whom all communications relating thereto shall be transmitted to the Company or
the Reinsurer. However, all communications concerning accounts, claim
information, funds and inquiries related thereto shall be transmitted to the
Company or the Reinsurer through Willis Re Inc., 5420 Millstream Road, P.O. Box
3000, McLeansville, North Carolina 27301-3000. Payments by the Company to Willis
Re Inc. shall be deemed to constitute payment to the Reinsurer and payments by
the


                                     Page 23

<PAGE>

Reinsurer to Willis Re Inc. shall be deemed to constitute payment to the Company
only to the extent that such payments are actually received by the Company.

IN WITNESS WHEREOF, the Company by its duly authorized representative has
executed this Contract as of the date specified below:

Signed this 8th day of March, 2006.

PHILADELPHIA INSURANCE COMPANY
PHILADELPHIA INDEMNITY INSURANCE COMPANY


By Christopher J. Maguire,
   -------------------------------------
   Executive Vice President and Chief
   Underwriting Officer


                                     Page 24

<PAGE>

                                    EXHIBIT A

                            PROPERTY THIRD AND FOURTH
                      EXCESS OF LOSS REINSURANCE AGREEMENT

                                    issued to

                         PHILADELPHIA INSURANCE COMPANY
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                            Bala Cynwyd, Pennsylvania

<TABLE>
<CAPTION>
                                           93442001-006    93442002-006
                                           Third Excess   Fourth Excess
                                           ------------   -------------
<S>                                        <C>            <C>
Company's Retention                        $10,000,000     $15,000,000
Reinsurer's Limit, Each Risk, Each Loss    $ 5,000,000     $35,000,000
Reinsurer's Limit, Each Loss Occurrence    $10,000,000     $35,000,000
Reinstatements                              1 free and
                                              1 at 100%       1 at 100%
Reinsurer's Limit, All Risks, All Losses   $15,000,000     $70,000,000
Terrorism Annual Aggregate Limit           $ 5,000,000     $35,000,000
Deposit Premium                            $ 1,886,000     $ 2,106,000
Minimum Premium                            $ 1,697,400     $ 1,895,405
Premium Rate                                      0.60%           0.67%
</TABLE>


                                    EXHIBIT A

<PAGE>

              NUCLEAR INCIDENT EXCLUSION CLAUSE - PHYSICAL DAMAGE -
                              REINSURANCE - U.S.A.

1)   This Agreement does not cover any loss or liability accruing to the
     Reinsured, directly or indirectly, and whether as Insurer or Reinsurer,
     from any Pool of Insurers or Reinsurers formed for the purpose of covering
     Atomic or Nuclear Energy risks.

2)   Without in any way restricting the operation of paragraph (1) of this
     Clause, this Agreement does not cover any loss or liability accruing to the
     Reinsured, directly or indirectly and whether as Insurer or Reinsurer, from
     any Insurance against Physical Damage (including business interruption or
     consequential loss arising out of such Physical Damage) to:

     I.   Nuclear reactor power plants including all auxiliary property on the
          site, or

     II.  Any other nuclear reactor installation, including laboratories
          handling radioactive materials in connection with reactor
          installations, and "critical facilities" as such, or

     III. Installations for fabricating complete fuel elements or for processing
          substantial quantities of "special nuclear material," and for
          reprocessing, salvaging, chemically separating, storing or disposing
          of "spent" nuclear fuel or waste materials, or

     IV.  Installations other than those listed in paragraph 2) III above using
          substantial quantities of radioactive isotopes or other products of
          nuclear fission.

3)   Without in any way restricting the operations of paragraphs 1) and 2)
     hereof, this Agreement does not cover any loss or liability by radioactive
     contamination accruing to the Reinsured, directly or indirectly, and
     whether as Insurer or Reinsurer, from any insurance on property which is on
     the same site as a nuclear reactor power plant or other nuclear
     installation and which normally would be insured therewith except that this
     paragraph 3) shall not operate

     a) where the Reinsured does not have knowledge of such nuclear reactor
power plant or nuclear installation, or

     b) where said insurance contains a provision excluding coverage for damage
to property caused by or resulting from radioactive contamination, however
caused. However, on and after 1st, January 1960, this sub-paragraph b) shall
only apply provided the said radioactive contamination exclusion provision has
been approved by the Government Authority having jurisdiction thereof.

4)   Without in any way restricting the operations of paragraphs 1), 2) and 3)
     hereof, this Agreement does not cover any loss or liability by radioactive
     contamination accruing to the Reinsured, directly or indirectly, and
     whether as Insurer or Reinsurer, when such radioactive contamination is a
     named hazard specifically insured against.

5)   It is understood and agreed that this Clause shall not extend to risks
     using radioactive isotopes in any form where the nuclear exposure is not
     considered by the Reinsured to be the primary hazard.

6)   The term "special nuclear material" shall have the meaning given it in the
     Atomic Energy Act of 1954, or by any law amendatory thereof.

7)   Reinsured to be sole judge of what constitutes:

     a) substantial quantities, and

     b) the extent of installation, plant or site.

NOTE: Without in any way restricting the operations of paragraph 1) hereof, it
is understood and agreed that:

     a)   all policies issued by the Reinsured on or before 31st, December 1957,
          shall be free from the application of the other provisions of this
          Clause until expiry date or 31st, December 1960, whichever first
          occurs whereupon all the provisions of this Clause shall apply,

     b)   with respect to any risk located in Canada policies issued by the
          Reinsured on or before 31st, December 1958, shall be free from the
          application of the other provisions of this Clause until expiry date
          or 31st, December 1960, whichever first occurs whereupon all the
          provisions of this Clause shall apply.

12/12/57
N.M.A. 1119
BRMA 35B

<PAGE>

                                  WAR EXCLUSION

As regards interests which at time of loss or damage are on shore, no liability
shall attach hereto in respect of any loss or damage which is occasioned by war,
invasion, hostilities, acts of foreign enemies, civil war, rebellion,
insurrection, military or usurped power, or martial law or confiscation by order
of any government or public authority.

This War Exclusion Clause shall not, however, apply to interests which at time
of loss or damage are within the territorial limits of the United States of
America (comprising the fifty States of the Union and the District of Columbia,
its territories and possessions, including the Commonwealth of Puerto Rico and
including Bridges between the United States of America and Mexico provided they
are under United States ownership), Canada, St. Pierre and Miquelon, provided
such interests are insured under original policies, endorsements or binders
containing a standard war or hostilities or warlike operations exclusion clause.

Nevertheless, this clause shall not be construed to apply to loss or damage
occasioned by riots, strikes, civil commotion, vandalism, malicious damage.

<PAGE>

                       INTERESTS AND LIABILITIES AGREEMENT
                                (the "Agreement")

                                       of

                         CATLIN INSURANCE COMPANY, LTD.
                          (the "Subscribing Reinsurer")

                               with respect to the

                            PROPERTY THIRD AND FOURTH
                       EXCESS OF LOSS REINSURANCE CONTRACT
                                (the "Contract")

                                    issued to

                         PHILADELPHIA INSURANCE COMPANY
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA
        AND ANY ADDITIONAL COMPANY ESTABLISHED OR ACQUIRED BY THE COMPANY
                                 (the "Company")

The Subscribing Reinsurer shall have the following share(s) in the interests and
liabilities of the "Reinsurer" as set forth in the Contract attached hereto and
executed by the Company:

     2.00% of the Property Third Excess of Loss Reinsurance Layer
     2.00% of the Property Fourth Excess of Loss Reinsurance Layer

This Agreement shall commence at 12:01 a.m., Eastern Standard Time, January 1,
2006, and shall continue in force until 12:01 a.m., Eastern Standard Time,
January 1, 2007.

The share of the Subscribing Reinsurer in the interests and liabilities of the
"Reinsurer" shall be several and not joint with the share of any other
subscribing reinsurer. In no event shall the Subscribing Reinsurer participate
in the interests and liabilities of the other subscribing reinsurers.

IN WITNESS WHEREOF, the Subscribing Reinsurer by its duly authorized
representative has executed this Agreement as of the date specified below:

Signed this 28th day of March, 2006.

CATLIN INSURANCE COMPANY, LTD.


By Mark Vaughan,
   ----------------------------------
   Underwriter

<PAGE>

                       INTERESTS AND LIABILITIES AGREEMENT
                                (the "Agreement")

                                       of

                          HANNOVER RUCKVERSICHERUNGS AG
                          (the "Subscribing Reinsurer")

                               with respect to the

                            PROPERTY THIRD AND FOURTH
                       EXCESS OF LOSS REINSURANCE CONTRACT
                                (the "Contract")

                                    issued to

                         PHILADELPHIA INSURANCE COMPANY
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA
        AND ANY ADDITIONAL COMPANY ESTABLISHED OR ACQUIRED BY THE COMPANY
                                 (the "Company")

The Subscribing Reinsurer shall have the following share(s) in the interests and
liabilities of the "Reinsurer" as set forth in the Contract attached hereto and
executed by the Company:

     8.00% of the Property Third Excess of Loss Reinsurance Layer
     8.00% of the Property Fourth Excess of Loss Reinsurance Layer

This Agreement shall commence at 12:01 a.m., Eastern Standard Time, January 1,
2006, and shall continue in force until 12:01 a.m., Eastern Standard Time,
January 1, 2007.

The share of the Subscribing Reinsurer in the interests and liabilities of the
"Reinsurer" shall be several and not joint with the share of any other
subscribing reinsurer. In no event shall the Subscribing Reinsurer participate
in the interests and liabilities of the other subscribing reinsurers.

IN WITNESS WHEREOF, the Subscribing Reinsurer by its duly authorized
representative has executed this Agreement as of the date specified below:

Signed this 5th day of April, 2006.

HANNOVER RUCKVERSICHERUNGS AG


By Harald Schlie,
   ----------------------------------
   Vice President

<PAGE>

                       INTERESTS AND LIABILITIES AGREEMENT
                                (the "Agreement")

                                       of

                         UNDERWRITERS AT LLOYD'S, LONDON
              AS SET FORTH IN THE SIGNING SCHEDULE ATTACHED HERETO
                          (the "Subscribing Reinsurer")

                               with respect to the

                            PROPERTY THIRD AND FOURTH
                       EXCESS OF LOSS REINSURANCE CONTRACT
                                (the "Contract")

                                    issued to

                         PHILADELPHIA INSURANCE COMPANY
                    PHILADELPHIA INDEMNITY INSURANCE COMPANY
                            BALA CYNWYD, PENNSYLVANIA
        AND ANY ADDITIONAL COMPANY ESTABLISHED OR ACQUIRED BY THE COMPANY
                                 (the "Company")

The Subscribing Reinsurer shall have the following share(s) in the interests and
liabilities of the "Reinsurer" as set forth in the Property Third and Fourth
Excess of Loss Reinsurance Layers of the Contract attached hereto and executed
by the Company. The Subscribing Reinsurer's percentage share for each layer
shall equal the sum of the final signed lines percentage share(s) for that layer
as executed on the attached signing page(s) for Lloyd's Underwriters.

This Agreement shall commence at 12:01 a.m., Eastern Standard Time, January 1,
2006 and shall continue in force until 12:01 a.m., Eastern Standard Time,
January 1, 2007.

The share of the Subscribing Reinsurer in the interests and liabilities of the
"Reinsurer" shall be several and not joint with the share of any other
subscribing reinsurer. In no event shall the Subscribing Reinsurer participate
in the interests and liabilities of the other subscribing reinsurers.

In any action, suit or proceeding to enforce the Subscribing Reinsurer's
obligations under the attached Contract, service of process may be made upon
Mendes & Mount, 750 Seventh Avenue, New York, New York 10019.

IN WITNESS WHEREOF, the Subscribing Reinsurer by its duly authorized
representative has executed this Agreement per the attached schedule.


Signed on behalf of Lloyds