----

Table 

| Article  |   |                                | Page  |
|---------------|--------|-------------------------------------|------------|
|          |   |                                |       |
| I             |   | Classes of BusinessReinsured        | 1          |
| II            |   | Commencement and Termination        | 1          |
| III           |   | Special Termination                 | 2          |
| IV            |   | Territory (BRMA 51A)                | 3          |
| V             |   | Exclusions                          | 3          |
| VI            |   | Retention and Limit                 | 7          |
| VII           |   | Reinstatement                       | 8          |
| VIII          |   | Definitions                         | 9          |
| IX            |   | Other Reinsurance                   | 12         |
| X             |   | Federal Terrorism Recovery          | 13         |
| XI            |   | Annuities at Company’s Option | 13         |
| XII           |   | Claims                              | 13         |
| XIII          |   | Special Commutation                 | 14         |
| XIV           |   | Salvage and Subrogation             | 16         |
| XV            |   | Premium                             | 16         |
| XVI           |   | Late Payments                       | 17         |
| XVII          |   | Offset                              | 18         |
| XVIII         |   | Access to Records (BRMA 1D)         | 18         |
| XIX           |   | Liability of the    Reinsurer       | 18         |
| XX            |   | Net Retained Lines (BRMA 32E)       | 19         |
| XXI           |   | Errors and Omissions (BRMA    14F)  | 19         |
| XXII          |   | Currency (BRMA 12A)                 | 19         |
| XXIII         |   | Taxes (BRMA 50B)                    | 19         |
| XXIV          |   | Federal Excise Tax (BRMA 17D)       | 20         |
| XXV           |   | Reserves                            | 20         |
| XXVI          |   | Insolvency                          | 22         |
| XXVII         |   | Arbitration                         | 22         |
| XXVIII        |   | Service of Suit (BRMA 49C)          | 23         |
| XXIX          |   | Agency Agreement (BRMA 73A)         | 24         |
| XXX           |   | Governing Law (BRMA 71B)            | 24         |
| XXXI          |   | Intermediary (BRMA 23A)             | 24         |
|          |   | Schedule A                          |       |

----

Classes 

Commencement 

| A. | This      Contract shall become effective at 12:01 a.m., Local Standard Time where      the occurrence commences, January 1, 2008, with respect to losses      arising out of occurrences commencing at or after that time and date, and      shall continue in force thereafter until  terminated. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | Either      party may terminate this Contract at 12:01 a.m., Local Standard Time      where the occurrence commences, on any January 1 by giving the other      party not less than 90 days prior notice by certified      mail. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | Unless      the Company elects that the Reinsurer have no liability for losses arising      out of occurrences commencing at or after the effective time and date of      termination, and so notifies the Reinsurer prior to or as promptly as      possible after the effective date of termination, reinsurance hereunder on      business in force at the effective time and date of termination shall      remain in full force and effect until expiration, cancellation or next      premium anniversary of such business, whichever first occurs, but in no      event beyond 12 months, plus odd time (not to exceed 18 months      in all), following the effective time and date of    termination. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| D. | Notwithstanding      the provisions above, in the event that any policy subject to this      Contract is required by statute, regulation or by order of an insurance      department to be continued in force, the Reinsurer agrees to extend      reinsurance coverage hereunder following the termination of this Contract      with respect to such policy until the first date that the Company may      lawfully non-renew, cancel or terminate such policy, whether or not the      Company actually does non-renew, cancel or terminate such      policy.  However, under no circumstances shall runoff coverage      under this paragraph exceed23 months. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| E. | “Contract      year” as used herein shall mean the period from 12:01 a.m., Local      Standard Time where the occurrence commences, January 1, 2008, to      12:01 a.m., Local Standard Time where the occurrence commences,      January 1, 2009, and each subsequent 12-month period (or portion      thereof) thereafter that this Contract continues in force shall be a      separate contract year.  If this Contract is terminated on a      “runoff” basis, the period from the effective date of termination through      the end of the “runoff” period shall be a separate contract year and      referred to as the “runoff contractyear.” |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Special 

| A. | Notwithstanding      the provisions of paragraph B of the Commencement and Termination      Article, either party may terminate this Contract at any time by giving      the other party not less than 30 days prior written notice in the      event any of the following circumstances occur (if terminated by either      party, said termination shall be on a “runoff” basis unless the Company      elects to have such termination on a “cutoff”  basis): |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | The      other party’s policyholders’ surplus (or its equivalent under the      Subscribing Reinsurer’s accounting system) at the beginning of any      contract year has been reduced by more than 30.0% of the amount of surplus      (or the applicable equivalent) 12 months prior to that date;      or |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | The      other party’s policyholders’ surplus (or its equivalent under the      Subscribing Reinsurer’s accounting system) at any time during the contract      year has been reduced by more than 30.0% of the amount of surplus (or the      applicable equivalent) at the date of the other party’s most recent      financial statement filed with regulatory authorities and available to the      public as of the beginning of the contract year;  or |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. | The      other party has become merged with, acquired by or controlled by any other      entity or individual(s) not controlling the other party’s operations      previously; however, this subparagraph shall not apply to the sale of      stock to a non-acquiring entity or where the acquiring company,      corporation or individual(s) has an A.M. Best’s rating higher than the      rating held by the other party at the beginning of the contract year;      or |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | 4. | The      State Insurance Department or other legal authority in the other party’s      state of domicile has ordered the other party to cease writing business;      or |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 5. | The      other party has become insolvent or has been placed into liquidation or      receivership (whether voluntary or involuntary) or proceedings have been      instituted against the other party for the appointment of a receiver,      liquidator, rehabilitator, conservator or trustee in bankruptcy, or other      agent known by whatever name, to take possession of its assets or control      of its operations; or |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 6. | The      other party has ceased writing new and renewal property and casualty      business. |
|--------|----|----------------------------------------------------------------------------------------------|

| B. | Notwithstanding      the provisions of paragraph B of the Commencement and Termination      Article, the Company may terminate a Subscribing Reinsurer’s percentage      share in this Contract by giving not less than 30 days prior written      notice to the Subscribing Reinsurer in the event the Subscribing      Reinsurer’s A.M. Best’s rating has been assigned or downgraded below A-      (includes any “Not Rated” rating) and/or Standard & Poor’s rating      has been assigned or downgraded below BBB+ (includes any “NR”      rating). |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | Notwithstanding      the provisions of paragraph B of the Commencement and Termination      Article, a Subscribing Reinsurer may terminate its percentage share in      this Contract by giving the Company not less than 30 days prior      written notice in the event any of the following circumstances occur (said      termination shall be on a “runoff” basis unless the Company elects to have      such termination on a “cutoff” basis; however, termination shall be on a      “cutoff” basis if the Subscribing Reinsurer terminates because the Company      has failed to pay premium): |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | 51.0%      or more of the Company or its portfolio is purchased or sold;      or |
|--------|----|----------------------------------------------------------------------------------|

|   | 2. | The      Company has failed to pay reinsurance premiums in accordance with this      Contract; or |
|--------|----|---------------------------------------------------------------------------------------------------|

|   | 3. | A      material change has occurred in any two of the Company’s three senior      officers (i.e., the Chief Executive Officer, the President, or the      Chief Financial Officer). |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Territory 

Exclusions

| A. | This      Contract does not apply to and specifically excludes the      following: |
|----|------------------------------------------------------------------------------------|

|   | 1. | Reinsurance      assumed by the Company under obligatory reinsurance agreements,      except: |
|--------|----|-----------------------------------------------------------------------------------------------|

|   | a. |   | Agency      reinsurance where the policies involved are to be reunderwritten in      accordance with the underwriting standards of the Company and reissued as      Company policies at the next anniversary or expiration    date; |
|--------|----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | b. |   | Intercompany      reinsurance between any of the reinsured companies under this      Contract. |
|--------|----|--------|------------------------------------------------------------------------------------------------|

|   | 2. | Ex-gratia      payments. |
|--------|----|--------------------------|

|   | 3. | Risks      subject to a deductible in excess of $25,000, or a self-insured retention      excess of $25,000, unless such deductible or self-insured retention is      otherwise mandated by statute or regulatory  authority. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 4. | Nuclear      risks as defined in the “Nuclear Incident Exclusion Clause -      Liability - Reinsurance (U.S.A.)” and loss or liability defined in      the “Nuclear Incident Exclusion Clause - Reinsurance - No. 4”      attached to and forming part of thisContract. |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 5. | Pollution      liability coverages excluded under the provisions of the “Pollution      Exclusion Clause - General Liability - Reinsurance (BRMA 39C)”      attached to and forming part of thisContract. |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 6. | Liability      as a member, subscriber or reinsurer of any Pool, Syndicate or      Association, but this exclusion shall not apply to Assigned Risk Plans or      similar state-mandated plans. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 7. | All      liability of the Company arising by contract, operation of law, or      otherwise, from its participation or membership, whether voluntary or      involuntary, in any insolvency fund.  “Insolvency fund” includes      any guaranty fund, insolvency fund, plan, pool, association, fund or other      arrangement, however denominated, established or governed, which provides      for any assessment of or payment or assumption by the Company of part or      all of any claim, debt, charge, fee or other obligation of an insurer, or      its successors or assigns, which has been declared by any competent      authority to be insolvent, or which is otherwise deemed unable to meet any      claim, debt, charge, fee or other obligation in whole or in      part. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 8. | Loss      or liability as excluded in the “War Risk Exclusion Clause (Reinsurance)”      attached to and forming part of this Contract.  However, this      exclusion shall not apply to an act of terrorism that is certified by the      Secretary of Treasury, in concurrence with the Secretary of State and the      Attorney General of the UnitedStates. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 9. | Operation      under the jurisdiction of the United States Longshore and Harbor Workers’      Compensation Act or the Jones Act, except for incidental exposures (i.e.,      10.0% or less of the insured’s estimated payroll when the account is      quoted). |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 10. | Operations      employing the process of nuclear fission or fusion or handling of      radioactive material, which operations include but are not limited      to: |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | a. |   | The      use of nuclear reactors such as atomic piles, particle accelerators or      generators; or |
|--------|----|--------|-----------------------------------------------------------------------------------------------------|

|   | b. |   | The      use, handling or transportation of radioactive materials, or the use,      handling or transportation of any weapon of war or explosive device      employing nuclear fission orfusion. |
|--------|----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | However,      subparagraphs a and b above shall not applyto: |
|--------|--------------------------------------------------------------|

|   | i. | The      exclusive use of particle accelerators incidental to ordinary industrial      or education research pursuits, or |
|--------|----|---------------------------------------------------------------------------------------------------------------------------|

|   | ii. | The      exclusive use, handling or transportation of radioisotopes for medical or      industrial use, or to radium or radium  compounds. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | 11. | Operation      of docks or wharves as related to port  authorities. |
|--------|-----|---------------------------------------------------------------------|

|   | 12. | The      manufacturing, mining, refining, processing, distribution, installation,      removal or encapsulment ofasbestos. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------|

|   | 13. | Risks      involving known exposure to the following  substances: |
|--------|-----|-------------------------------------------------------------------|

|   | a. |   | Dioxin; |
|--------|----|--------|---------|

|   | b. |   | Polychlorinated      biphenols; |
|--------|----|--------|---------------------------------|

|   | c. |   | Asbestos. |
|--------|----|--------|-----------|

|   | 14. | All      railway operations except sidetrackagreements. |
|--------|-----|---------------------------------------------------------|

|   | 15. | Amusement      parks, carnivals or circuses.  This exclusion shall not apply to      miniature golf courses or driving range  operations. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 16. | Subaquaeous      operations. |
|--------|-----|------------------------------|

|   | 17. | Underground      mining; however, this exclusion shall not be construed to apply to      open-pit quarrying or “surface mining”  operations. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 18. | Blasting      operations, except for incidental exposures (i.e., 10.0% or less of the      insured’s estimated payroll when the account is  quoted). |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 19. | Demolition      of buildings or structures in excess of five  stories. |
|--------|-----|------------------------------------------------------------------------|

|   | 20. | Shoring      and moving of buildings or structures, or underpinning that involves pier      and beam construction, commercial buildings with more than three stories      or hillside building reinforcements.  However, this exclusion      shall not apply to foundation repair risks for which neither the insured      nor its employees are in tunnels or are otherwise working under      buildings. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 21. | Erection      or repair of scaffolds if 10.0% or more of the insured’s annual      remuneration is attributed to NCCI Class Code 9534 or  9529. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 22. | Construction      of tunnels or dams. |
|--------|-----|---------------------------------------|

----

|   | 23. | Fireworks,      fuses, or any explosive substance (as defined below) as      follows: |
|--------|-----|---------------------------------------------------------------------------------------|

|   | a. |   | Manufacturers      or importers of such items; |
|--------|----|--------|------------------------------------------------|

|   | b. |   | Loading      of such items into containers for use as explosive objects, propellant      charges or detonation devices and the storage thereof (except as      previously provided for, on an incidental basis, in      exclusion 18); |
|--------|----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | c. |   | Manufacturers      or importers of any product in which such items are an      ingredient; |
|--------|----|--------|--------------------------------------------------------------------------------------------|

|   | d. |   | Handling,      storage, transportation or use of such items (except as previously      provided for, on an incidental basis, in    exclusion 18). |
|--------|----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | “Explosive      substance” is defined as any substance manufactured for the express      purpose of exploding as differentiated from commodities used industrially      and which are only incidentallyexplosive. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 24. | Onshore      and offshore gas and oil drillingoperations. |
|--------|-----|-----------------------------------------------------------|

|   | 25. | Operations      where principal business includes the use of any owned or unowned      aircraft, or any device or machine intended for and/or aiding in the      achievement of atmospheric flight, projection or orbit, and/or the      ownership or operation of any airport.  This exclusion shall not      apply where exposure is incidental (i.e., constitutes 10.0% or less      of the insured’s payroll) to the principal business operations and the      aircraft contains eight seats orfewer. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 26. | Municipal      law enforcement organizations and municipal fire fighting organizations,      whether professional or voluntary.  This exclusion shall not      apply to off-duty law enforcement officers when employed by an entity      other than a municipality for duties performed within the scope of the job      for which they were hired. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 27. | Logging      or forestry operations. |
|--------|-----|--------------------------------------|

|   | 28. | Professional      employment organizations (PEOs). |
|--------|-----|----------------------------------------------------|

|   | 29. | Professional      sports teams. |
|--------|-----|---------------------------------|

|   | 30. | Operations      where the principal business of the risk is manufacturing, production,      distribution, refining or storage of natural or artificial fuel, gas,      butane, propane, liquefied petroleum gases or gasoline.  This      exclusion shall not apply to any risk whose principal business operations      are any of the following: |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | a. |   | Retail      gasoline service station, either full or self service, or retail gasoline      marina; |
|--------|----|--------|----------------------------------------------------------------------------------------------------|

|   | b. |   | Convenience      store with gasoline sales with its petroleum gas and/or storage tanks      located below ground. |
|--------|----|--------|-------------------------------------------------------------------------------------------------------------------|

|   | 31. | Acts      of terrorism, as defined in paragraph G of the Definitions Article,      that: |
|--------|-----|------------------------------------------------------------------------------------------|

|   | a. |   | Involve      the use, release or escape of nuclear materials;  or |
|--------|----|--------|-------------------------------------------------------------------|

----

|   | b. |   | Directly      or indirectly result in nuclear reaction or radiation or radioactive      contamination; or |
|--------|----|--------|-----------------------------------------------------------------------------------------------------------|

|   | c. |   | Are      carried out by means of the dispersal or application of pathogenic or      poisonous biological or chemical materials where it appears that one      purpose of the act of terrorism was to release such    materials. |
|--------|----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 32. | Business      reinsured by the Minnesota Workers’ Compensation Reinsurance Association,      whether contractually assumed or imposed by law, including, but not      limited to, direct or indirect loss, damage, liability, cost or      expense.  However, this exclusion shall not apply      to: |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | a. |   | Losses      paid within the Company’s net retention;or |
|--------|----|--------|--------------------------------------------------------------|

|   | b. |   | Losses      paid in excess of the benefits allowed under Minnesota Workers’      Compensation law. |
|--------|----|--------|----------------------------------------------------------------------------------------------------------|

| B. | In      the event the Company is inadvertently bound on any risk which is excluded      under subparagraph 9 or subparagraphs 14 through 30 of paragraph A above,      the reinsurance provided under this Contract shall apply on such risk      until discovery by the Company of the existence of such risk and for 30      days thereafter, or for a period of time specific to the applicable state      cancellation requirements, not to exceed 120 days.  This      limitation shall not apply as respects Arizona.  Coverage shall      cease after such time or at policy anniversary as respects Arizona      policies, unless the Company has received from the Reinsurer written      notice of its approval of such risk within  30 days. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | Notwithstanding      the foregoing, any reinsurance falling within the scope of one or more of      the exclusions set forth above that is specially accepted by the Reinsurer      from the Company shall be covered under this Contract and subject to all      of the terms and conditions hereof, except as such terms are modified by      the special acceptance.  In the event a reinsurer becomes a      party to this Contract subsequent to one or more special acceptances      hereunder, the new reinsurer shall automatically accept such special      acceptance(s) as being covered hereunder.  Further, if one or      more reinsurers under this Contract agreed to special acceptance(s) under      the contract replaced by this Contract, such special acceptance(s) shall      be automatically covered hereunder with respect to the interests and      liabilities of such reinsurer(s), except for special acceptance(s) on      risks that have experienced a material change in exposure (i.e., more than      a 10.0% change in payroll or a new operation that would require a special      acceptance on its own merits). |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Retention 

| A. | As      respects all losses subject hereto, except losses arising out of an      occurrence of an act of terrorism, as respects each excess layer of      reinsurance coverage provided by this Contract, the Company shall retain      and be liable for the first amount of ultimate net loss (whether involving      any one or any combination of the classes of business covered hereunder,      regardless of the number of policies under which such loss is payable or      the number of different interests insured), shown as “Company’s Retention”      for that excess layer in Schedule A attached hereto, arising out of each      occurrence.  The Reinsurer shall then be liable, as respects      each excess layer, for the amount by which such ultimate net loss exceeds      the Company’s retention, but the liability of the Reinsurer shall not      exceed the amount, shown as “Reinsurer’s Per Occurrence Limit” for that      excess layer in Schedule A attached hereto, as respects any one      occurrence. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| B. | As      respects losses arising out of an occurrence of an act of terrorism, as      respects each excess layer of reinsurance coverage provided hereunder, the      Company shall retain and be liable for the first amount of ultimate net      loss, shown as “Company’s Retention” for that excess layer in Schedule A      attached hereto, arising out of each occurrence.  The Reinsurer      shall then be liable, as respects each excess layer, for the amount by      which such ultimate net loss exceeds the Company’s retention, but the      liability of the Reinsurer shall not exceed the amount shown as      “Reinsurer’s Terrorism Per Occurrence Limit” for that excess layer in      Schedule A attached hereto as respects any one occurrence of an act      of terrorism, nor shall it exceed the amount shown as “Reinsurer’s      Contract Year Terrorism Limit” for that excess layer in Schedule A      attached hereto as respects loss or losses arising out of all occurrences      of acts of terrorism during any one contract  year. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | The      Company deems that the maximum Employers Liability policy limits subject      hereto shall not exceed $2,000,000.  Policy limits in excess of      $2,000,000 may be submitted by special acceptance to the Reinsurer for      coverage hereunder, subject to the provisions of paragraph C of the      Exclusions Article. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Reinstatement

| A. | In      the event all or any portion of the reinsurance under any excess layer of      reinsurance coverage provided by paragraph A of the Retention and      Limit Article of this Contract is exhausted by loss, the amount so      exhausted shall be reinstated immediately from the time the occurrence      commences hereon. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | As      respects each amount so reinstated under the first excess layer, the      Company shall pay no additionalpremium. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------|

|   | 2. | As      respects each amount so reinstated under the second excess layer, the      Company agrees to pay additional premium equal to the product of the      following: |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | a. |   | The      percentage of the occurrence limit for the second excess layer reinstated      (based on the loss paid by the Reinsurer under that excess layer);      times |
|--------|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | b. |   | The      earned reinsurance premium for the second excess layer for the contract      year (exclusive of reinstatementpremium). |
|--------|----|--------|---------------------------------------------------------------------------------------------------------------------------------|

| B. | Whenever      the Company requests payment by the Reinsurer of any loss under the second      excess layer that triggers additional reinstatement premium to be paid      hereunder, the Company shall submit a statement to the Reinsurer of      reinstatement premium due the Reinsurer for that excess      layer.  If the earned reinsurance premium for the second excess      layer for the contract year has not been finally determined as of the date      of any such statement, the calculation of reinstatement premium due for      that excess layer shall be based on the annual deposit premium for that      excess layer and shall be readjusted when the earned reinsurance premium      for that excess layer for the contract year has been finally      determined.  Any reinstatement premium shown to be due the      Reinsurer for the second excess layer as reflected by any such statement      (less prior payments, if any, for that excess layer) shall be payable by      the Company concurrently with payment by the Reinsurer of the requested      loss for that excess layer.  Any return reinstatement premium      shown to be due the Company shall be remitted by the Reinsurer as promptly      as possible after receipt and verification of the Company’s      statement. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| C. | Notwithstanding      anything stated herein, the liability of the Reinsurer under each excess      layer of reinsurance coverage provided by this Contract shall not exceed      any of the following: |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | The      amount, shown as “Reinsurer’s Per Occurrence Limit” for that excess layer      in Schedule A attached hereto, as respects loss or losses arising out      of any one occurrence which is not an act of  terrorism; |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | The      amount, shown as “Reinsurer’s Terrorism Per Occurrence Limit” for that      excess layer in Schedule A attached hereto, as respects loss or      losses arising out of any one occurrence of an act of      terrorism; |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. | The      amount, shown as “Reinsurer’s Contract Year Limit” for that excess layer      in Schedule A attached hereto as respects loss or losses arising out      of all occurrences commencing during any one contract year;    or |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 4. | The      amount, shown as “Reinsurer’s Contract Year Terrorism Limit” for that      excess layer in Schedule A attached hereto, as respects loss or      losses arising out of all occurrences of acts of terrorism commencing      during any one contract year. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Definitions

| A. | “Ultimate      net loss” as used herein is defined as the sum or sums (including loss in      excess of policy limits, extra contractual obligations and any loss      adjustment expense, as hereinafter defined) paid or payable by the Company      in settlement of claims and in satisfaction of judgments rendered on      account of such claims, after deduction of all recoveries from      subrogation, all recoveries, and all claims on inuring insurance or      reinsurance, whether collectible or not.  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. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | “Loss      in excess of policy limits” and “extra contractual obligations” as used      herein shall be defined as follows: |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | “Loss      in excess of policy limits” shall mean 90.0% of any amount paid or payable      by the Company in excess of its policy limits, but otherwise within the      terms of its policy, such loss in excess of the Company’s policy limits      having been incurred because of, but not limited to, failure by the      Company to settle within the policy limits or by reason of the Company’s      alleged or actual negligence or bad faith in rejecting an offer of      settlement or in the preparation of the defense or in the trial of an      action against its insured or reinsured or in the preparation or      prosecution of an appeal consequent upon such an  action. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | 2. | “Extra      contractual obligations” shall mean 90.0% of any punitive, exemplary,      compensatory or consequential damages paid or payable by the Company, not      covered by any other provision of this Contract and which arise from the      handling of any claim on business subject to this Contract, such      liabilities arising because of, but not limited to, failure by the Company      to settle within the policy limits or by reason of the Company’s alleged      or actual negligence or bad faith in rejecting an offer of settlement or      in the preparation of the defense or in the trial of an action against its      insured or reinsured or in the preparation or prosecution of an appeal      consequent upon such an action.  An extra contractual obligation      shall be deemed, in all circumstances, to have occurred on the same date      as the loss covered or alleged to be covered under the    policy. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Notwithstanding      anything stated herein, this Contract shall not apply to any loss in      excess of policy limits or any extra contractual obligation incurred by      the Company as a result of any fraudulent and/or criminal act by any      officer or director of the Company acting individually or collectively or      in collusion with any individual or corporation or any other organization      or party involved in the presentation, defense or settlement of any claim      covered hereunder. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | If      any provision of this paragraph B shall be rendered illegal or      unenforceable by the laws, regulations or public policy 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. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | “Occurrence”      as used herein is defined as an accident or occurrence or a series of      accidents or occurrences arising out of or caused by one event, whether      involving one or more of the Company’s policies, except    that: |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | As      respects Workers’ Compensation policies, each occupational or industrial      disease or cumulative injury case contracted by an employee of an insured      shall be deemed to have been caused by a separate occurrence commencing      on: |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | a. |   | The      date of disability for which compensation is payable if the case is      compensable under the Workers’ CompensationLaw; |
|--------|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | b. |   | The      date disability due to the disease actually began if the case is not      compensable under the Workers’ Compensation Law;  or |
|--------|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|

|   | c. |   | The      date of cessation of employment if claim is made after employment has      ceased. |
|--------|----|--------|---------------------------------------------------------------------------------------------|

|   | 2. | Notwithstanding      the provisions of subparagraph 1 above, as respects losses resulting from      occupational or industrial disease and cumulative injury suffered by      employees of an insured for which the employer is liable as a result of a      sudden and accidental event not exceeding 72 hours in duration, all      such losses shall be considered one occurrence and may be combined with      losses not classified as occupational or industrial disease or cumulative      injury which arise out of the same event and the combination of such      losses shall be considered as one occurrence within the meaning      hereof. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | 3. | Notwithstanding      the foregoing, the following shall apply to occurrences involving natural      disasters: |
|--------|----|----------------------------------------------------------------------------------------------------------------|

|   | a. |   | An      occurrence shall be limited to damage, injury or loss arising out of a      natural disaster during any continuous 168 hour  period. |
|--------|----|--------|----------------------------------------------------------------------------------------------------------------------------------------------|

|   | b. |   | The      Company may choose the date and time when such 168 hour period commences      and if the occurrence is of greater duration than 168 hours, the Company      may divide such occurrence into two or more occurrences, provided no two      periods overlap and provided no period commences earlier than the date and      time of the first loss to the Company in such  occurrence. |
|--------|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | c. |   | “Natural      disaster” shall mean loss caused by the perils of tornado, cyclone,      windstorm, hurricane and hail arising from the same atmospheric      disturbance; earthquake, including ensuing fire, landslide, mudslide,      flood, tidal wave; volcanic eruptions; flood; tides; tidal wave;      landslide/mudslide; and meteors. |
|--------|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| D. | “Occupational      or industrial disease” shall mean any abnormal condition that fulfills all      of the following conditions: |
|----|---------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | It      is not traceable to a definite compensable accident occurring during the      employee’s present or past employment;and |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | It      has been caused by exposure to a disease producing agent or agents present      in the workers’ occupational environment;and |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. | It      has resulted in a disability ordeath. |
|--------|----|-----------------------------------------------|

| E. | “Cumulative      injury” is any injury that fulfills all of the following      conditions: |
|----|--------------------------------------------------------------------------------------------------------|

|   | 1. | It      is not traceable to a definite compensable accident occurring during the      employee’s present or past employment;and |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | It      has occurred from, and has been aggravated by, a repetitive      employment-related activity; and |
|--------|----|-----------------------------------------------------------------------------------------------------------|

|   | 3. | It      has resulted in a disability ordeath. |
|--------|----|-----------------------------------------------|

| F. | “Loss      adjustment expense” as used herein shall mean expenses assignable to the      investigation, appraisal, adjustment, settlement, litigation, defense      and/or appeal of specific claims, regardless of how such expenses are      classified for statutory reporting purposes.  Loss adjustment      expense shall include, but not be limited to, interest on judgments,      expenses of outside adjusters and claim-specific declaratory judgment      expenses or other legal expenses and costs incurred in connection with      coverage questions and legal actions connected thereto, but shall not      include office expenses or salaries of the Company’s regular employees      other than medical management personnel whose cost the Company will bill      to specific cases on a time and expense basis.  “Loss adjustment      expense” shall not include (i) any fines or penalties assessed by or with      regard to the Racketeer      Influenced and Corrupt Organizations Act (RICO) or any equivalent      state act or (ii) any fines or penalties assessed by any governmental      entity for any type of marketconduct. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| G. | “Act      of terrorism” as used herein shall include all loss, cost or expense,      including fire following, related directly or indirectly from      either: |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | Any      act of any person or persons either acting on behalf of or in connection      with any organization or group with activities directed towards      overthrowing, intimidating, coercing or influencing any government de jure or de facto or its      populace or its economic, political or social systems, by force, violence,      weapons of mass destruction, disruption or subversion of communication and      information system infrastructures and/or its content thereof, or      sabotage, and/or threat therefrom;or |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | An      act of terrorism that is certified by the Secretary of Treasury, in      concurrence with the Secretary of State and the Attorney General of the      United States. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Terrorism      losses also include all actual or alleged losses, liabilities, damages,      injuries, defense costs, and costs or expenses directly or indirectly      arising out of, contributed by, caused by, resulting from, or in      connection with any action taken in controlling, preventing, suppressing,      retaliating against, or responding to suchacts. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Notwithstanding      the above, in the event of an occurrence which arises out of an act of      workplace violence and is not consistent with the provisions of      subparagraphs 1 and 2 of this paragraph G, such loss shall      be covered hereunder, subject to the provisions of the Exclusions Article      and all other provisions of this Contract and shall not be considered an      act of terrorism.  Further, any occurrence which is not or      cannot be determined, classified or certified in accordance with the      provisions of subparagraphs 1 and 2 of this paragraph G      shall be covered hereunder and not considered an act of      terrorism. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| H. | “Declaratory      judgment expenses” as used herein shall mean all expenses incurred by the      Company in connection with declaratory judgment actions brought to      determine the Company’s defense and/or indemnification obligations that      are assignable to specific policies and claims subject to this      Contract.  Declaratory judgment expenses shall be deemed to have      been incurred by the Company on the date of the original loss (if any)      giving rise to the declaratory judgment action.  In the event      there is no loss other than declaratory judgment expenses with respect to      any claim hereunder, such expenses shall be deemed loss for purposes of      this Contract. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Other Reinsurance

| A. | The      Company shall be permitted to carry facultative reinsurance, recoveries      under which shall inure to the benefit of this  Contract. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | The      Company shall be permitted to carry underlying quota share reinsurance and      underlying excess 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. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Federal 

| A. | Any      loss reimbursement the Company receives from the United States Government      under the Terrorism Risk Insurance Act of 2002, as amended by the      Terrorism Risk Insurance Extension Act of 2005 and any subsequent      amendments or extensions thereof (together the “Terrorism Act”) as a      result of occurrences commencing during each contract year shall inure to      the benefit of this Contract in the proportion that the Company’s insured      losses (as defined in the Terrorism Act) in that occurrence under policies      reinsured under this Contract bear to the Company’s total insured losses      in that occurrence. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | If      a loss reimbursement received by the Company under the Terrorism Act is      based on the Company’s insured losses in more than one occurrence and the      United States Government does not designate the amount allocable to each      occurrence, the reimbursement shall be prorated in the proportion that the      Company’s insured losses in each occurrence bear to the Company’s total      insured losses arising out of all occurrences to which the recovery      applies. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Annuities 

| A. | Whenever      the Company is required, or elects, to purchase an annuity or to negotiate      a structured settlement in excess of the retention of this Contract,      either in satisfaction of a judgment or in an out-of-court settlement or      otherwise, the cost of the annuity or the structured settlement, as the      case may be, shall be deemed part of the Company’s ultimate net loss,      provided such annuity or structured settlement terms grant the Company      full and final release as respects the indemnity portion of the      settlement.  Additionally, it is the Company’s intent to place      all annuities or structured settlements with a carrier whose      A.M. Best’s rating is “A” orbetter. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | The      terms “annuity” or “structured settlement” shall be understood to mean any      insurance policy, lump sum payment, agreement or device of whatever nature      resulting in the payment of a lump sum by the Company in settlement of any      or all future liabilities which may attach to it as a result of an      occurrence. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | In      the event the Company purchases an annuity which inures in whole or in      part to the benefit of the Reinsurer, it is understood that the liability      of the Reinsurer is not released thereby. In the event the Company is      required to provide benefits not provided by the annuity for whatever      reason, the Reinsurer shall pay its share of any  loss. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Claims

| A. | Whenever      a claim or settlement by the Company hereunder is for an amount greater      than $1,000,000 and/or whenever a claim appears likely to result in a      claim under this Contract, the Company shall notify the      Reinsurer.  Further, the Company shall notify the Reinsurer      whenever a claim involves a fatality, amputation, spinal cord damage,      brain damage, blindness or extensive burns, regardless of liability,      including all subsequent developments.  The Reinsurer shall have      the right to participate, at its own expense, in the defense of any claim      or suit or proceeding involving this reinsurance.  The Company      shall also provide any additional information that from time to time may      be reasonably required by the Reinsurer to ascertain liability under this      Contract. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| B. | All      claim settlements made by the Company, provided such settlements are      within the terms of this Contract, shall be binding upon the Reinsurer,      and the Reinsurer agrees to pay all amounts for which it is liable upon      receipt of reasonable evidence of the amount paid by the      Company. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Special 

| A. | In      the event a Subscribing Reinsurer meets one or more of the following      conditions, the Company may require a commutation of that portion of any      excess loss hereunder represented by any outstanding claim or claims,      including any related loss adjustmentexpense: |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | The      Subscribing Reinsurer’s A.M. Best’s rating has been assigned or downgraded      below A- (including any “Not Rated” rating) and/or Standard & Poor’s      rating has been assigned or downgraded below BBB+ (includes any “NR”      rating); or |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | The      Subscribing Reinsurer has ceased assuming new and renewal property and      casualty treaty reinsurancebusiness. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------|

|   | “Outstanding      claim or claims” shall be defined as known or unknown claims, including      any billed yet unpaid claims.  However, unless otherwise      mutually agreed, this paragraph A shall not apply unless the      outstanding claim or claims is for an amount not less than      $5,000. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | If      the Company elects to require commutation as provided in paragraph A      above, the Company shall submit a Statement of Valuation of the      outstanding claim or claims as of the last day of the month immediately      preceding the month in which the Company elects to require commutation, as      determined by the Company.  Such Statement of Valuation shall      include the elements considered reasonable to establish the excess loss      and shall set forth or attach the information relied upon by the Company      and the methodology employed to calculate the excess loss.  The      Subscribing Reinsurer shall then pay the amount requested within 30      calendar days of receipt of such Statement of Valuation, unless the      Subscribing Reinsurer needs additional information from the Company to      assess the Company’s Statement of Valuation or contests such      amount. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | If      the Subscribing Reinsurer needs additional information from the Company to      assess the Company’s Statement of Valuation or contests the amount      requested, the Subscribing Reinsurer shall so notify the Company within 15      calendar days of receipt of the Company’s Statement of      Valuation.  The Company shall supply any reasonably requested      information to the Subscribing Reinsurer within 15 calendar days of      receipt of the notification.  Within 30 calendar days of      the date of the notification or of the receipt of the information,      whichever is later, the Subscribing Reinsurer shall provide the Company      with its Statement of Valuation of the outstanding claim or claims as of      the last day of the month immediately preceding the month in which the      Company elects to require commutation, as determined by the Subscribing      Reinsurer.  Such Statement of Valuation shall include the      elements considered reasonable to establish the excess loss and shall set      forth or attach the information relied upon by the Subscribing Reinsurer      and the methodology employed to calculate the excess  loss. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| D. | If      agreement, as outlined in paragraphs A, B and C, cannot be reached,      either party can abandon the commutation effort, or the Company and the      Subscribing Reinsurer may seek to settle any difference by mutually      appointing an independent actuary. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| E. | If      the parties cannot agree on an acceptable independent actuary within 15      calendar days of the date of the Subscribing Reinsurer’s Statement of      Valuation, then each party shall appoint an actuary as party arbitrators      for the limited and sole purpose of selecting an independent      actuary.  If the actuaries cannot agree on an acceptable      independent actuary within 15 calendar days of the date of the Subscribing      Reinsurer’s Statement of Valuation, the Company shall supply the      Subscribing Reinsurer with a list of at least three proposed independent      actuaries, and the Subscribing Reinsurer shall select the independent      actuary from that list. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| F. | Upon      selection of the independent actuary, both parties shall present their      respective written submissions to the independent actuary.  The      independent actuary may, at his or her discretion, request additional      information.  The independent actuary shall issue his or her      decision within 45 calendar days after the written submissions have been      filed and any additional information has been  provided. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| G. | The      decision of the independent actuary shall be final and      binding.  The expense of the independent actuary shall be      equally divided between the two parties.  For the purposes of      this Article, unless mutually agreed otherwise, an “independent actuary”      shall be an actuary who satisfies each of the following      criteria: |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | Is      regularly engaged in the valuation of claims resulting from lines of      business subject to this Contract;and |
|--------|----|-------------------------------------------------------------------------------------------------------------------------|

|   | 2. | Is      either a Fellow of the Casualty Actuarial Society or of the American      Academy of Actuaries; and |
|--------|----|-------------------------------------------------------------------------------------------------------------|

|   | 3. | Is      disinterested and impartial regarding this  commutation. |
|--------|----|------------------------------------------------------------------|

| H. | Notwithstanding      paragraphs A, B and C above, in the event that the Subscribing Reinsurer      no longer meets any of the conditions specified in subparagraph 1 or 2 in      paragraph A above, this commutation may continue on a mutually agreed      basis. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| I. | Payment      by the Subscribing Reinsurer of the amount requested in accordance with      paragraph B, C or F above, shall release the Subscribing Reinsurer      from all further liability for outstanding claim or claims, known or      unknown, under this Contract and shall release the Company from all      further liability for payments of salvage or subrogation amounts, known or      unknown, to the Subscribing Reinsurer under this  Contract. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| J. | In      the event of any conflict between this Article and any other article of      this Contract, the terms of this Article shall  control. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------|

| K. | This      Article shall survive the termination of this  Contract. |
|----|--------------------------------------------------------------------|

----

Salvage 

Premium

| A. | As      premium for each excess layer of reinsurance coverage provided by this      Contract, the Company shall pay the Reinsurer the greater of the following      for each contract year (except the runoff contract year, if      any): |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | The      amount (or pro rata portion thereof if this Contract is terminated prior      to the end of any 12-month contract year in accordance with the provisions      of the Special Termination Article), shown as “Annual Minimum Premium” for      that excess layer in Schedule A attached hereto;  or |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | The      percentage, shown as “Premium Rate” for that excess layer in      Schedule A attached hereto, of the Company’s net earned premium for      the contract year. |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | The      Company shall pay the Reinsurer an annual deposit premium for each excess      layer of the amount, shown as “Annual Deposit Premium” for that excess      layer in Schedule A attached hereto, in four equal installments of      the amount, shown as “Quarterly Deposit Premium” for that excess layer in      Schedule A attached hereto, on January 1, April 1,      July 1 and October 1 of each contract year (except the runoff      contract year, if any).  However, no deposit premium      installments shall be due after the effective date of      termination. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | Within      60 days following the end of each contract year (except the runoff      contract year, if any), the Company shall provide a report to the      Reinsurer setting forth the premium due hereunder for each excess layer      for the contract year, computed in accordance with paragraph A, and      any additional premium due the Reinsurer for each such excess layer shall      be remitted by the Company with its report.  If the premium so      computed for any excess layer is less than the previously paid, but more      than the minimum premium, for that excess layer, the balance shall be      returned by the Reinsurer to the Company within 30 days of the      report. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| D. | In      the event this Contract is terminated on a “runoff” basis, the Company      shall pay the Reinsurer premium for each excess layer for the runoff      contract year equal to the percentage, shown as “Premium Rate” for that      excess layer in Schedule A attached hereto, of the Company’s net earned      premium applicable to subject business for that excess layer during the      runoff contract year.  Within 30 days following the end of      each three-month period during the runoff contract year, the Company shall      provide a report to the Reinsurer setting forth the premium due hereunder      for each excess layer for the applicable three-month period, computed in      accordance with this paragraph, and such premium shall be remitted by the      Company with its report. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| E. | “Net      earned premium” as used herein is defined as the Company’s gross earned      premium for the classes of business subject to this Contract (exclusive of      premium for business covered by the Minnesota Workers’ Compensation      Reinsurance Association), adjusted for experience modification, discounts,      credits, surcharges, expense constants and deductible credits, plus or      minus the Reinsurer’s pro rata share of any premium arising from audit      adjustments, minus premiums paid for facultative reinsurance which inures      to the benefit of this Contract. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Late Payments

| A. | The      provisions of this Article shall not be implemented unless      specifically invoked, in writing, by one of the parties to this      Contract. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | In      the event any premium, loss or other payment due either party is not      received by the intermediary named in the Intermediary Article (BRMA 23A)      (hereinafter referred to as the “Intermediary”) by the payment due date,      the party to whom payment is due may, by notifying the Intermediary in      writing, require the debtor party to pay, and the debtor party agrees to      pay, an interest penalty on the amount past due calculated for each such      payment on the last business day of each month as  follows: |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | The      number of full days which have expired since the due date or the last      monthly calculation, whichever the lesser;times |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | 1/365ths      of the six-month United States Treasury Bill rate as quoted in The Wall Street Journal      on the first business day of the month for which the calculation is      made; times |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. | The      amount past due, including accruedinterest. |
|--------|----|------------------------------------------------------|

|   | It      is agreed that interest shall accumulate until payment of the original      amount due plus interest penalties have been received by the      Intermediary. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | The      establishment of the due date shall, for purposes of this Article, be      determined as follows: |
|----|------------------------------------------------------------------------------------------------------------|

|   | 1. | As      respects the payment of routine deposits and premiums due the Reinsurer,      the due date shall be as provided for in the applicable section of this      Contract.  In the event a due date is not specifically stated      for a given payment, it shall be deemed due 30 days after the date of      transmittal by the Intermediary of the initial billing for each such      payment. |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | Any      claim or loss payment due the Company hereunder shall be deemed due      30 days after the proof of loss and demand for payment is transmitted      to the Reinsurer.  If such loss or claim payment is not received      within the 30 days, interest will accrue on the payment or amount      overdue in accordance with paragraph B above, from the date the proof      of loss and demand for payment was transmitted to the      Reinsurer. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | 3. | As      respects any payment, adjustment or return due either party not otherwise      provided for in subparagraphs 1 and 2 above, the due date shall be as      provided for in the applicable section of this Contract.  In the      event a due date is not specifically stated for a given payment, it shall      be deemed due 30 days following transmittal of written notification      that the provisions of this Article have been  invoked. |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | For      purposes of interest calculations only, amounts due hereunder shall be      deemed paid upon receipt by theIntermediary. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------|

| D. | Nothing      herein shall be construed as limiting or prohibiting a Subscribing      Reinsurer from contesting the validity of any claim, or from participating      in the defense of any claim or suit, or prohibiting either party from      contesting the validity of any payment or from initiating any arbitration      or other proceeding in accordance with the provisions of this      Contract.  If the debtor party prevails in an arbitration or      other proceeding, then any interest penalties due hereunder on the amount      in dispute shall be null and void.  If the debtor party loses in      such proceeding, then the interest penalty on the amount determined to be      due hereunder shall be calculated in accordance with the provisions set      forth above unless otherwise determined by such proceedings.  If      a debtor party advances payment of any amount it is contesting, and proves      to be correct in its contestation, either in whole or in part, the other      party shall reimburse the debtor party for any such excess payment made      plus interest on the excess amount calculated in accordance with this      Article. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| E. | Interest      penalties arising out of the application of this Article that are      $50,000 or less from any party shall be waived unless there is a pattern      of late payments consisting of three or more items over the course of any      12-month period. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Offset

Access 

Liability 

| A. | The      liability of the Reinsurer shall follow that of the Company in every case      and be subject in all respects to all the general and specific      stipulations, clauses, waivers and modifications of the Company’s policies      and any endorsements thereon.  However, in no event shall this      be construed in any way to provide coverage outside the terms and      conditions set forth in thisContract. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| B. | Nothing      herein shall in any manner create any obligations or establish any rights      against the Reinsurer in favor of any third party or any persons not      parties to this Contract. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Net 

| 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. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Errors 

Currency 

| 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 StatesDollars. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 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. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Taxes 

----

Federal 

| A. | The      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 ExciseTax. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | In      the event of any return of premium becoming due hereunder the 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. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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 Reinsurer a statement showing the proportion of such      reserves which is applicable to the Reinsurer.  The Reinsurer      hereby agrees to fund such reserves in respect of known outstanding losses      that have been reported to the Reinsurer and allocated loss adjustment      expense relating thereto, losses and loss adjustment expense paid by the      Company but not recovered from the Reinsurer, plus reserves for losses and      loss adjustment expense incurred but not reported, as shown in the      statement prepared by the Company (hereinafter referred to as “Reinsurer’s      Obligations”) by Regulation 114 trust accounts, funds withheld, cash      advances or a Letter of Credit, or combination thereof.  For      purposes of this Contract, the Lloyd’s United States Credit for      Reinsurance Trust Fund and the Hannover Re U.S. Master Trust shall be      considered acceptable funding instruments.  The 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 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 meeting the NAIC      Securities Valuation Office credit standards for issuers of Letters of      Credit and containing provisions acceptable to the insurance regulatory      authorities having jurisdiction over the Company’s reserves in an amount      equal to the Reinsurer’s proportion of said reserves.  Such      Letter of Credit shall be issued for a period of not less than one year,      and shall contain an “evergreen” clause, which automatically extends the      term 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      Reinsurer and Company agree that the Letters of Credit provided by the      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 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 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 Reinsurer’s Obligations under this Contract, if so requested by      the Reinsurer; |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. | To      fund an account with the Company for the 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      Reinsurer; |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 4. | To      pay the 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 subparagraphs 1 or 3, or in the      case of subparagraph 4, the actual amount determined to be due, the      Company shall promptly return to the 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      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      quarterly intervals and on an estimated basis 45 days prior to each      December 31, or more frequently as agreed but never more frequently than      quarterly, the Company shall prepare a specific statement of the      Reinsurer’s Obligations, for the sole purpose of amending the Letter of      Credit, in the following manner: |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | If      the statement shows that the Reinsurer’s Obligations exceed the balance of      credit as of the statement date, the 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 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 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. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Insolvency

| A. | In      the event of the insolvency of one or more of the reinsured companies,      this reinsurance shall be payable directly to the company or to its      liquidator, receiver, conservator or statutory successor 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 pro rata 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 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 thecompany. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | It      is further understood and agreed that, in the event of the insolvency of      one or more of the reinsured companies, the reinsurance under this      Contract shall be payable directly by the Reinsurer to the company or to      its liquidator, receiver 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      payees under such policies and in substitution for the obligations of the      company to such payees. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Arbitration

| A. | As      a condition precedent to any right of action hereunder, in the event of      any dispute or difference of opinion hereafter arising with respect to      this Contract, it is hereby mutually agreed that such dispute or      difference of opinion shall be submitted to arbitration.  One      Arbiter shall be chosen by the Company, the other by the Reinsurer, and an      Umpire shall be chosen by the two Arbiters before they enter upon      arbitration, all of whom shall be active or retired disinterested      executive officers of insurance or reinsurance companies or Lloyd’s London      Underwriters.  In the event that either party should fail to      choose an Arbiter within 30 days following a written request by the      other party to do so, the requesting party may choose two Arbiters who      shall in turn choose an Umpire before entering upon      arbitration.  If the two Arbiters fail to agree upon the      selection of an Umpire within 30 days following their appointment,      the Umpire shall be appointed in accordance with the procedures of the      American Arbitration Association. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| B. | Each      party shall present its case to the Arbiters within 30 days following the      date of appointment of the Umpire.  The Arbiters shall consider      this Contract as an honorable engagement rather than merely as a legal      obligation and they are relieved of all judicial formalities and may      abstain from following the strict rules of law.  The decision of      the Arbiters shall be final and binding on both parties; but failing to      agree, they shall call in the Umpire and the decision of the majority      shall be final and binding upon both parties.  Judgment upon the      final decision of the Arbiters may be entered in any court of competent      jurisdiction. |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | If      more than one reinsurer is involved in the same dispute, all such      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      reinsurers constituting one party, provided, however, that nothing herein      shall impair the rights of such reinsurers to assert several, rather than      joint, defenses or claims, nor be construed as changing the liability of      the reinsurers participating under the terms of this Contract from several      to joint. |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| D. | Each      party shall bear the expense of its own Arbiter, and shall jointly and      equally bear with the other the expense of the Umpire and of the      arbitration.  In the event that the two Arbiters are chosen by      one party, as above provided, the expense of the Arbiters, the Umpire and      the arbitration shall be equally divided between the two      parties. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| E. | Any      arbitration proceedings shall take place at a location mutually agreed      upon by the parties to this Contract, but notwithstanding the location of      the arbitration, all proceedings pursuant hereto shall be governed by the      law of the state in which the Company has its principal      office. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Service of Suit

| A. | It      is agreed that in the event the Reinsurer fails to pay any amount claimed      to be due hereunder, the Reinsurer, at the request of the Company, will      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 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 UnitedStates. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | Further,      pursuant to any statute of any state, territory or district of the United      States which makes provision therefor, the Reinsurer hereby designates the      party named in its Interests and Liabilities Agreement, or if no party is      named therein, 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 proceeding      instituted by or on behalf of the Company or any beneficiary hereunder      arising out of this Contract. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Agency 

Governing Law

Intermediary 

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Schedule 

|                                                  |   | FirstExcess |       |   | SecondExcess |   |
|-------------------------------------------------------|--------|-------------|------------|--------|--------------|--------|
| Company’s      Retention                        |   | $           | 2,000,000  |   |         | $      | 5,000,000 |   |
| Reinsurer’s      Per Occurrence Limit           |   | $           | 3,000,000  |   |         | $      | 5,000,000 |   |
| Reinsurer’s      Terrorism Per Occurrence Limit |   | $           | 3,000,000  |   |         | $      | 5,000,000 |   |
| Reinsurer’s      Contract Year Limit            |   | $           | 21,000,000 |   |         | $      | 10,000,000 |   |
| Reinsurer’s      Contract Year Terrorism Limit  |   | $           | 3,000,000  |   |         | $      | 5,000,000 |   |
| Annual      Minimum Premium                           |   | $           | 4,092,000  |   |         | $      | 1,000,000 |   |
| Premium      Rate                                     |   |        | 2.2000     | %      |         |   | 0.5376 | % |
| Annual      Deposit Premium                           |   | $           | 5,115,000  |   |         | $      | 1,250,000 |   |
| Quarterly      Deposit Premium                        |   | $           | 1,278,750  |   |         | $      | 312,500 |   |

----

| (1) | This      reinsurance does not cover any loss or liability accruing to the Reassured      as a member of, or subscriber to, any association of insurers or      reinsurers formed for the purpose of covering nuclear energy risks or as a      direct or indirect reinsurer of any such member, subscriber or      association. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Without      in any way restricting the operation of paragraph (1) of this Clause it is      understood and agreed that for all purposes of this reinsurance all the      original policies of the Reassured (new, renewal and replacement) of the      classes specified in Clause II of this paragraph (2) from the time      specified in Clause III in this paragraph (2) shall be deemed to include      the following provision (specified as the Limited Exclusion      Provision): |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Limited      Exclusion Provision.* |
|--------|------------------------------------|

|   | I. | It      is agreed that the policy does not apply under any liability coverage,      to |
|--------|----|----------------------------------------------------------------------------------------|

|   | (injury, sickness, disease,      death or destruction |
|--------|-------------------------------------------------------|

|   | (bodily      injury or property damage |
|--------|----------------------------------------|

|   | with      respect to which an insured under the policy is also an insured under a      nuclear energy liability policy issued by Nuclear Energy Liability      Insurance Association, Mutual Atomic Energy Liability Underwriters or      Nuclear Insurance Association of Canada, or would be an insured under any      such policy but for its termination upon exhaustion of its limit of      liability. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | II. | Family      Automobile Policies (liability only), Special Automobile Policies (private      passenger automobiles, liability only), Farmers Comprehensive Personal      Liability Policies (liability only), Comprehensive Personal Liability      Policies (liability only) or policies of a similar nature; and the      liability portion of combination forms related to the four classes of      policies stated above, such as the Comprehensive Dwelling Policy and the      applicable types of HomeownersPolicies. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | III. | The      inception dates and thereafter of all original policies as described in II      above, whether new, renewal or replacement, being policies which      either |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) |   | become      effective on or after 1st May, 1960,or |
|--------|-----|--------|----------------------------------------------------|

|   | (b) |   | become      effective before that date and contain the Limited Exclusion Provision set      out above; |
|--------|-----|--------|--------------------------------------------------------------------------------------------------------|

|   | provided      this paragraph (2) shall not be applicable to Family Automobile Policies,      Special Automobile Policies, or policies or combination policies of a      similar nature, issued by the Reassured on New York risks, until 90 days      following approval of the Limited Exclusion Provision by the Governmental      Authority having jurisdictionthereof. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Except      for those classes of policies specified in Clause II of paragraph (2) and      without in any way restricting the operation of paragraph (1) of this      Clause, it is understood and agreed that for all purposes of this      reinsurance the original liability policies of the Reassured (new, renewal      and replacement) affording the following  coverages: |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Owners,      Landlords and Tenants Liability, Contractual Liability, Elevator      Liability, Owners or Contractors (including railroad) Protective      Liability, Manufacturers and Contractors Liability, Product Liability,      Professional and Malpractice Liability, Storekeepers Liability, Garage      Liability, Automobile Liability (including Massachusetts Motor Vehicle or      Garage Liability) |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | shall      be deemed to include, with respect to such coverages, from the time      specified in Clause V of this paragraph (3), the following provision      (specified as the Broad ExclusionProvision): |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Broad      Exclusion Provision.* |
|--------|----------------------------------|

|   | It      is agreed that the policy does notapply: |
|--------|--------------------------------------------------|

|   | I. | Under      any Liability Coverage to |
|--------|----|--------------------------------------|

|   | (injury, sickness, disease,      death or destruction |
|--------|-------------------------------------------------------|

|   | (bodily      injury or property damage |
|--------|----------------------------------------|

|   | (a) |   | with      respect to which an insured under the policy is also an insured under a      nuclear energy liability policy issued by Nuclear Energy Liability      Insurance Association, Mutual Atomic Energy Liability Underwriters or      Nuclear Insurance Association of Canada, or would be an insured under any      such policy but for its termination upon exhaustion of its limit of      liability; or |
|--------|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) |   | resulting      from the hazardous properties of nuclear material and with respect to      which (1) any person or organization is required to maintain financial      protection pursuant to the Atomic Energy Act of 1954, or any law      amendatory thereof, or (2) the insured is, or had this policy not been      issued would be, entitled to indemnity from the United States of America,      or any agency thereof, under any agreement entered into by the United      States of America, or any agency thereof, with any person or      organization. |
|--------|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | II. | Under      any Medical Payments Coverage, or under any Supplementary Payments      Provision relating to |
|--------|-----|----------------------------------------------------------------------------------------------------------|

|   | (immediate medical or surgical      relief |
|--------|--------------------------------------------|

|   | (first      aid, |
|--------|------------------|

|   | to      expenses incurred with respect to |
|--------|-------------------------------------------|

|   | (bodily injury, sickness,      disease or death |
|--------|-------------------------------------------------|

|   | (bodily      injury |
|--------|---------------------|

|   | resulting      from the hazardous properties of nuclear material and arising out of the      operation of a nuclear facility by any person or    organization. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | III. | Under      any Liability Coverage to |
|--------|------|--------------------------------------|

|   | (injury, sickness, disease,      death or destruction |
|--------|-------------------------------------------------------|

|   | (bodily      injury or property damage |
|--------|----------------------------------------|

|   | resulting      from the hazardous properties of nuclear material,  if |
|--------|-----------------------------------------------------------------------|

|   | (a) |   | the      nuclear material (1) is at any nuclear facility owned by, or operated by      or on behalf of, an insured or (2) has been discharged or dispersed      therefrom;               |
|--------|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (b) |   | the      nuclear material is contained in spent fuel or waste at any time      possessed, handled, used, processed, stored, transported or disposed of by      or on behalf of an insured; or |

|   | (c) |   | the |
|--------|-----|--------|-----|

|   | (injury, sickness, disease,      death or destruction |
|--------|-------------------------------------------------------|
|   | (bodily      injury or property damage                |

|   | arises      out of the furnishing by an insured of services, materials, parts or      equipment in connection with the planning, construction, maintenance,      operation or use of any nuclear facility, but if such facility is located      within the United States of America, its territories, or possessions or      Canada, this exclusion (c) applies onlyto |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (injury to or destruction of      property at such nuclearfacility |
|--------|--------------------------------------------------------------------|

|   | (property      damage to such nuclear facility and any property  thereat. |
|--------|---------------------------------------------------------------------------|

|   | IV. | As      used in this endorsement: |
|--------|-----|-----------------------------------|

|   | “hazardous      properties” include radioactive, toxic or explosive properties; “nuclear      material” means source material, special nuclear material or byproduct      material; “source material”, “special nuclear material”, and “byproduct      material” have the meanings given them in the Atomic Energy Act of 1954 or      in any law amendatory thereof; “spent fuel” means any fuel element or fuel      component, solid or liquid, which has been used or exposed to radiation in      a nuclear reactor; “waste” means any waste material (1) containing      byproduct material and (2) resulting from the operation by any person      or organization of any nuclear facility included within the definition of      nuclear facility under paragraph (a) or (b) thereof; “nuclear facility”      means |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) |   | any      nuclear reactor,                                                                                                                                                                                   |
|--------|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (b) |   | any      equipment or device designed or used for (1) separating the isotopes of      uranium or plutonium, (2) processing or utilizing spent fuel, or (3)      handling processing or packagingwaste, |

|   | (c) |   | any      equipment or device used for the processing, fabricating or alloying of      special nuclear material if at any time the total amount of such material      in the custody of the insured at the premises where such equipment or      device is located consists of or contains more than 25 grams of plutonium      or uranium 233 or any combination thereof, or more than 250 grams of      uranium 235, |
|--------|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) |   | any      structure, basin, excavation, premises or place prepared or used for the      storage or disposal of waste, and includes the site on which any of the      foregoing is located, all operations conducted on such site and all      premises used for such operations; “nuclear reactor” means any apparatus      designed or used to sustain nuclear fission in a self-supporting chain      reaction or to contain a critical mass of fissionable      material; |
|--------|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (With respect to injury to or      destruction of property, the word “injury” or      “destruction,” |
|--------|------------------------------------------------------------------------------------------------------------------------------|

|   | (“property      damage” includes all forms of radioactive contamination of      property, |
|--------|-------------------------------------------------------------------------------------------------------|

|   | (includes all forms of      radioactive contamination ofproperty. |
|--------|-------------------------------------------------------------------|

|   | V. | The      inception dates and thereafter of all original policies affording      coverages specified in this paragraph (3), whether new, renewal or      replacement, being policies which become effective on or after 1st May,      1960, provided this paragraph (3) shall not be applicable    to |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) |   | Garage      and Automobile Policies issued by the Reassured on New York risks,      or |
|--------|-----|--------|----------------------------------------------------------------------------------------|

|   | (ii) |   | statutory      liability insurance required under Chapter 90, General Laws of      Massachusetts, until 90 days following approval of the Broad      Exclusion Provision by the Governmental Authority having jurisdiction      thereof. |
|--------|------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Without      in any way restricting the operation of paragraph (1) of this Clause, it      is understood and agreed that paragraphs (2) and (3) above are not      applicable to original liability policies of the Reassured in Canada and      that with respect to such policies this Clause shall be deemed to include      the Nuclear Energy Liability Exclusion Provisions adopted by the Canadian      Underwriters’ Association or the Independent Insurance Conference of      Canada. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| *NOTE. | The words printed in italics      in the Limited Exclusion Provision and in the Broad Exclusion Provision      shall apply only in relation to original liability policies which include      a Limited Exclusion Provision or a Broad Exclusion Provision containing      those words. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (1) | This      reinsurance does not cover any loss or liability accruing to the Reassured      as a member of, or subscriber to, any association of insurers formed for      the purpose of covering nuclear energy risks or as a direct or indirect      reinsurer of any such member, subscriber or  association. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Without      in any way restricting the operations of Nuclear Incident Exclusion Clause      No. 1B - Liability, No. 2 - Physical Damage, No. 3 - Boiler and Machinery      and paragraph (1) of this clause, it is understood and agreed that for all      purposes as respects the reinsurance assumed by the Reinsurer from the      Reassured, all original insurance policies or contracts of the Reassured      (new, renewal and replacement) shall be deemed to include the applicable      existing Nuclear Clause and/or Nuclear Exclusion Clause(s) in effect at      the time and any subsequent revisions thereto as agreed upon and approved      by the Insurance Industry and/or a qualified Advisory or Rating      Bureau. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| A. | This      reinsurance excludes all loss and/or liability accruing to the reinsured      company as a result of: |
|----|-----------------------------------------------------------------------------------------------------------------|

|   | 1. | bodily      injury or property damage arising out of the actual, alleged or threatened      discharge, dispersal, release or escape of  pollutants: |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | a. |   | at      or from premises owned, rented or occupied by a named    insured; |
|--------|----|--------|---------------------------------------------------------------------------|

|   | b. |   | at      or from any site or location used by or for a named insured or others for      the handling, storage, disposal, processing or treatment of      waste; |
|--------|----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | c. |   | which      are at any time transported, handled, stored, treated, disposed of, or      processed as waste by or for a named insured or any person or organization      for whom a named insured may be legally responsible;  or |
|--------|----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | d. |   | at      or from any site or location on which a named insured or any contractors      or subcontractors working directly or indirectly on behalf of a named      insured are performing operations: |
|--------|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | if      the pollutants are brought on or to the site or location in connection      with such operations; or |
|--------|-----|--------------------------------------------------------------------------------------------------------------|

|   | (ii) | if      the operations are to test for, monitor, clean up, remove, contain, treat,      detoxify or neutralize thepollutants; |
|--------|------|-------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | any      governmental direction or request that a named insured test for, monitor,      clean up, remove, contain, treat, detoxify or neutralize      pollutants. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B. | Subparagraphs      A(1)(a) and A(1)(d)(i) above do not apply to bodily injury or property      damage caused by heat, smoke or fumes from a hostile  fire. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| C. | “Hostile      fire” means a fire which becomes uncontrollable or breaks out from where      it was intended to be. |
|----|--------------------------------------------------------------------------------------------------------------------------------|

| D. | “Pollutants”      means any solid, liquid, gaseous or thermal irritant or contaminant,      including smoke, vapor, soot, fumes, acids, alkalis, chemicals and      waste.  Waste includes material to be recycled, reconditioned or      reclaimed. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| Reinsurers                                     |  Participations |
|------------------------------------------------|----------------------|
|                                           |                 |   |
| Everest      Reinsurance Company               |                 | 25.0% |
| Max      Bermuda Ltd.                          |                 | 22.5 |
| Safety      National Casualty Corporation      |                 | 7.5 |
|                                           |                 |   |
| Through      Benfield Limited (Placement Only) |                 |   |
| PARIS      RE                                  |                 | 20.0 |
|                                           |                 |   |
| Total                                          |                 | 75.0% part of100%      share inthe      interests and liabilities of the“Reinsurer” |

| Reinsurers                                          |  Participations |
|-----------------------------------------------------|----------------------|
|                                                |                 |   |
| Hannover      Rueckversicherungs-Aktiengesellschaft |                 | 35.0% |
| Max      Bermuda Ltd.                               |                 | 10.0 |
|                                                |                 |   |
| Through      Benfield Limited (Placement Only)      |                 |   |
| PARIS      RE                                       |                 | 21.5 |
|                                                |                 |   |
| Through      Benfield Limited                       |                 |   |
| Lloyd’s      Underwriters and Companies       |                 |   |
|   Per      Signing Page(s)                |                 | 33.5 |
|                                                |                 |   |
| Total                                               |                 | 100.0% |

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