**Exhibit 10.35**Ref. No. 2003-015-01

**ADDENDUM NO. 1**ATTACHEDTO AND FORMING A PART OFTHE REINSURANCE AGREEMENT

**(hereinafter referred to as “Agreement”)**

**between**

**SAFETY INSURANCE COMPANYSAFETY INDEMNITY INSURANCE COMPANY**

**(hereinafter referred to as the “Company”)**

**and**

**THE HARTFORD STEAM BOILER INSPECTION AND INSURANCECOMPANY (hereinafter referred to as the “Reinsurer”)**

IT IS UNDERSTOOD AND AGREED that, effective April     ,2006, the following amendments are made to the Agreement to which this Addendumattaches:

Article 4,Forms, Rates and Rules,is hereby amended to read as follows:

**“ARTICLE 4 - FORMS, RATES AND RULES**

Reinsurance will be provided only in accordance with forms, rates andrules mutually acceptable to the Company and the Reinsurer. As respectsBusinessowners and Commercial Package policies, the agreed forms shall be thoseset forth in the Agreement, and the rates and rules shall be those set forth inthe “Binding Authority and Preferred Guidelines” effective 1/20/03 on file withthe Reinsurer. The “Binding Authority and Preferred Guidelines” may be amendedfrom time to time, as mutually agreed to by the Company and the Reinsurer.”

2.                          ParagraphC., of Article 5,Definitions, is hereby deleted.

3.                          ParagraphsB., C. and D. of Article 7,Other Provisions, are hereby deleted.

4.                          Article11, Reinsurance Premium, is hereby amended to read as follows:

**“ARTICLE 11 - REINSURANCE PREMIUM**

A.                     ForBusinessowners policies attaching on or after April 1, 2006, the Company shallpay to the Reinsurer 4.05% of the Company’s Net Premiums Written. The term “NetPremiums Written” as used herein means the Businessowners gross packagepremiums, plus additional premiums less cancellations and return premiums.

B.                       ForCommercial Package policies attaching on or after April 1, 2006, the Companyshall pay to the Reinsurer 6.94% of the Company’s Net Premiums Written. Theterm “Net Premiums Written” as used herein means the Commercial Package grossproperty policy premiums, plus additional premiums less cancellations andreturn premiums.

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**Ref. No. 2003-015-01**

C.                       Inthe event Special Acceptances are covered hereunder as set forth in Article16,Special Acceptances, the Company shall pay to the Reinsurer thereinsurance premium agreed upon for said Special Acceptances.”

5.                          Article12, Ceding Commission, is hereby deleted.

6.                          ParagraphA. of Article 13,Reports and Remittances, is hereby amended toread as follows:

“A.               Within30 days after the close of each month, the Company shall report to theReinsurer the Net Premiums Written during that month and the ReinsurancePremium as calculated in accordance with Article 11. Payment will beimmediately due and payable by the debtor party.”

7.                          “Exhibit- Referral Guidelines” attached to the Agreement is hereby deleted.

All other terms and conditions of the Agreement to which this Addendumattaches are unchanged and apply with full force and effect.

IN WITNESS WHEREOF, the parties hereto have caused this Addendum to beexecuted, in duplicate, in Boston, Massachusetts, this 10 day of August, 2006.
|        |    | SAFETY INSURANCE COMPANY  SAFETY INDEMNITY INSURANCE COMPANY |   |
|--------|---------|--------------------------------------------------------------|--------|
|   |    |                                                         |   |
|   |    |                                                         |   |
|   | By:     | /s/ Illegible                                                |   |
|   |    |                                                         |   |
|   |    |                                                         |   |
|   | Attest: | /s/ Illegible                                                |   |
|   |    |                                                         |   |
|        |         |                                                              |        |  |

 

and in Hartford, Connecticut, this 10 day of August,2006.
|        | **THE HARTFORD  STEAM BOILER INSPECTION AND INSURANCE COMPANY** |
|--------|-----------------------------------------------------------------|
|   | ** **                                                      |
|   | By:                                                             | /s/ Michael A. Petruzzello |   |   |  |
|   |                                                            | Michael A. Petruzzello, Executive Vice President and  Chief Underwriting Officer |
|   |                                                            |   |   |   |   |
|   |                                                            |   |   |   |   |
|   | By:                                                             | /s/ Jeffrey P. Watt |   |   |   |
|   |                                                            | Jeffrey P. Watt, Senior Vice President |   |   |   |

 

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