**Exhibit 10.29**

**ExcessCatastropheReinsurance Contract Effective: January 1, 2006**

issued to

Safety InsuranceCompanyandSafety Indemnity Insurance Company both of Boston, Massachusetts

 

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**ExcessCatastropheReinsurance ContractEffective: January 1, 2006**

issued to

Safety Insurance CompanyandSafety Indemnity Insurance Company both of Boston, Massachusetts

Third Excess CatastropheReinsurance
| **Reinsurers**                                              | ** ** | **Participations**                                                                               | ** ** |
|-------------------------------------------------------------|------------|--------------------------------------------------------------------------------------------------|------------|
| ** **                                                  | ** ** | ** **                                                                                       | ** ** |
| American Agricultural  Insurance Company                    |       | 0.900                                                                                            | %          |
| American Re-Insurance  Company, A Delaware Corporation      |       | 3.000                                                                                            |       |
| Aspen Insurance UK  Limited                                 |       | 4.000                                                                                            |       |
| Catlin Insurance  Company Ltd.                              |       | 1.500                                                                                            |       |
| Da Vinci Reinsurance  Ltd.                                  |       | 2.400                                                                                            |       |
| Endurance Specialty  Insurance Ltd.                         |       | 3.500                                                                                            |       |
| Folksamerica  Reinsurance Company                           |       | 3.000                                                                                            |       |
| Harbor Point Services  Inc. (for Federal Insurance Company) |       | 5.000                                                                                            |       |
| Hannover Re (Bermuda),  Ltd.                                |       | 6.500                                                                                            |       |
| Montpelier Reinsurance  Limited                             |       | 5.000                                                                                            |       |
| Odyssey America  Reinsurance Corporation                    |       | 3.000                                                                                            |       |
| Partner Reinsurance Company                                 |       | 4.500                                                                                            |       |
| Platinum Underwriters  Reinsurance, Inc.                    |       | 4.500                                                                                            |       |
| Renaissance  Reinsurance, Ltd.                              |       | 3.600                                                                                            |       |
| XL Re Ltd                                                   |       | 6.000                                                                                            |       |
| ** **                                                  |       |                                                                                             |       |
| **Through Benfield Limited**                                |       |                                                                                             |       |
| Amlin Bermuda Limited                                       |       | 3.348                                                                                            |       |
| Lloyd’s Underwriters  Per Signing Schedule(s)          |       | 26.952                                                                                           |       |
| ** **                                                  |       |                                                                                             |       |
| **Through Direct Market**                                   |       |                                                                                             |       |
| Swiss Reinsurance  America Corporation                      |       | 3.300                                                                                            |       |
| ** **                                                  | ** ** | ** **                                                                                       |       |
| **Total**                                                   | ** ** | **90.000****%**part of 100% share in the interests and liabilities of  the “Reinsurer” |       |

 

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Fourth ExcessCatastrophe Reinsurance
| **Reinsurers**                                                                  | ** ** | **Participations**                                                                               | ** ** |
|---------------------------------------------------------------------------------|------------|--------------------------------------------------------------------------------------------------|------------|
| ** **                                                                      | ** ** | ** **                                                                                       | ** ** |
| American  Agricultural Insurance Company                                        |       | 0.900                                                                                            | %          |
| American  Re-Insurance Company, A Delaware Corporation                          |       | 3.000                                                                                            |       |
| Aspen Insurance  UK Limited                                                     |       | 2.500                                                                                            |       |
| Catlin Insurance  Company Ltd.                                                  |       | 1.500                                                                                            |       |
| Da Vinci  Reinsurance Ltd.                                                      |       | 2.000                                                                                            |       |
| Endurance  Specialty Insurance Ltd.                                             |       | 3.500                                                                                            |       |
| Folksamerica Reinsurance  Company                                               |       | 2.000                                                                                            |       |
| Harbor Point  Services Inc. (for Federal Insurance Company)                     |       | 5.000                                                                                            |       |
| Hannover Re  (Bermuda), Ltd.                                                    |       | 7.000                                                                                            |       |
| Montpelier  Reinsurance Limited                                                 |       | 5.000                                                                                            |       |
| Odyssey America  Reinsurance Corporation                                        |       | 3.000                                                                                            |       |
| Partner  Reinsurance Company                                                    |       | 4.500                                                                                            |       |
| Platinum  Underwriters Reinsurance, Inc.                                        |       | 3.500                                                                                            |       |
| Renaissance  Reinsurance, Ltd.                                                  |       | 3.000                                                                                            |       |
| Swiss Re  Underwriters Agency, Inc. (for Swiss Reinsurance America Corporation) |       | 5.500                                                                                            |       |
| XL Re Ltd                                                                       |       | 6.000                                                                                            |       |
|                                                                            |       |                                                                                             |       |
| **Through  Benfield Limited**                                                   |       |                                                                                             |       |
| Amlin Bermuda  Limited                                                          |       | 3.015                                                                                            |       |
| Lloyd’s  Underwriters Per Signing Schedule(s)                              |       | 24.885                                                                                           |       |
|                                                                            |       |                                                                                             |       |
| **Through  Direct Market**                                                      |       |                                                                                             |       |
| Swiss  Reinsurance America Corporation                                          |       | 4.200                                                                                            |       |
|                                                                            |       |                                                                                             |       |
| **Total**                                                                       | ** ** | **90.000****%**part of 100% share in the interests and liabilities of  the “Reinsurer” |       |

 

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**Table of Contents**
| Article    | ** ** | ** **                      | ** ** | **Page**   |
|------------|------------|---------------------------------|------------|------------|
| ** ** | ** ** | ** **                      | ** ** | ** ** |
|       |       | Classes of Business Reinsured   |       |       |
|       |       |                            |       |       |
| II         |       | Commencement and Termination    |       | 1          |
|       |       |                            |       |       |
| III        |       | Territory (BRMA 51A)            |       | 2          |
|       |       |                            |       |       |
| IV         |       | Exclusions                      |       | 2          |
|       |       |                            |       |       |
| V          |       | Retention and Limit             |       | 4          |
|       |       |                            |       |       |
| VI         |       | Reinstatement                   |       | 4          |
|       |       |                            |       |       |
| VII        |       | Definitions                     |       | 5          |
|       |       |                            |       |       |
| VIII       |       | Other Reinsurance               |       | 6          |
|       |       |                            |       |       |
| IX         |       | Loss Occurrence                 |       | 6          |
|       |       |                            |       |       |
| X          |       | Loss Notices and Settlements    |       | 8          |
|       |       |                            |       |       |
| XI         |       | Salvage and Subrogation         |       | 9          |
|       |       |                            |       |       |
| XII        |       | Reinsurance Premium             |       | 9          |
|       |       |                            |       |       |
| XIII       |       | Late Payments                   |       | 10         |
|       |       |                            |       |       |
| XIV        |       | Offset (BRMA 36C)               |       | 11         |
|       |       |                            |       |       |
| XV         |       | Access to Records (BRMA 1D)     |       | 11         |
|       |       |                            |       |       |
|       |       | Net Retained Lines (BRMA 32E)   |       | 11         |
|       |       |                            |       |       |
| XVII       |       | Liability of the Reinsurer      |       | 11         |
|       |       |                            |       |       |
|       |       | Errors and Omissions (BRMA 14F) |       | 12         |
|       |       |                            |       |       |
| XIX        |       | Currency (BRMA 12A)             |       | 12         |
|       |       |                            |       |       |
| XX         |       | Taxes (BRMA 50B)                |       | 12         |
|       |       |                            |       |       |
| XXI        |       | Federal Excise Tax              |       | 12         |
|       |       |                            |       |       |
| XXII       |       | Unauthorized Reinsurers         |       | 12         |
|       |       |                            |       |       |
| XXIII      |       | Insolvency                      |       | 14         |
|       |       |                            |       |       |
| XXIV       |       | Arbitration                     |       | 14         |
|       |       |                            |       |       |
| XXV        |       | Service of Suit (BRMA 49C)      |       | 15         |
|       |       |                            |       |       |
| XXVI       |       | Governing Law                   |       | 16         |
|       |       |                            |       |       |
| XXVII      |       | Agency Agreement                |       | 16         |
|       |       |                            |       |       |
| XXVIII     |       | Severability (BRMA 72E)         |       | 16         |
|       |       |                            |       |       |
| XXIX       |       | Intermediary (BRMA 23A)         |       | 16         |
|       |       |                            |       |       |
|       |       | Schedule A                      |       |       |

 

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**Excess CatastropheReinsurance ContractEffective: January 1, 2006**

issued to

Safety Insurance Companyand Safety Indemnity Insurance Companyboth of Boston, Massachusetts (*hereinafter referred to collectively as the*“Company”)

by

The Subscribing Reinsurer(s)Executing the Interests and Liabilities Agreement(s)Attached Hereto *(hereinafter referred to as the*“Reinsurer”)

**Article I - Classes of Business Reinsured**

By this Contract the Reinsurer agrees to reinsure the excess liabilitywhich may accrue to the Company under its policies, contracts and binders ofinsurance or reinsurance (hereinafter called “policies”) in force on theeffective date hereof or issued or renewed on or after that date, andclassified by the Company as Fire, Allied Lines, Homeowners Multiple Peril(Section I only), Commercial Multiple Peril (Section I only), Inland Marine andAutomobile Physical Damage (not to include Collision coverage) business,subject to the terms, conditions and limitations set forth herein and inSchedule A attached to and forming part of this Contract.

**Article II - Commencement and Termination**

A.                      ThisContract shall become effective at 12:01 a.m., Eastern Standard Time, January1, 2006, with respect to losses arising out of loss occurrences commencing ator after that time and date, and shall remain in force until 12:01 a.m.,Eastern Standard Time, January 1, 2007.

B.                        Notwithstandingthe provisions of paragraph A above, the Company may terminate a SubscribingReinsurer’s percentage share in this Contract at any time by giving writtennotice to the Subscribing Reinsurer in the event any of the followingcircumstances occur:

The Subscribing Reinsurer’s policyholders’ surplus atthe inception of this Contract has been reduced by more than 20.0% of theamount of surplus 12 months prior to that date; or

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2.                         TheSubscribing Reinsurer’s policyholders’ surplus at any time during the term ofthis Contract has been reduced by more than 20.0% of the amount of surplus atthe date of the Subscribing Reinsurer’s most recent financial statement filedwith regulatory authorities and available to the public as of the inception ofthis Contract; or

3.                         TheSubscribing Reinsurer’s A.M. Best’s rating has been assigned or downgradedbelow A- and/or Standard & Poor’s rating has been assigned or downgradedbelow BBB+; or

4.                         TheSubscribing Reinsurer has become merged with, acquired by or controlled by anyother company, corporation or individual(s) not controlling the SubscribingReinsurer’s operations previously; or

5.                         AState Insurance Department or other legal authority has ordered the SubscribingReinsurer to cease writing business; or

6.                         TheSubscribing Reinsurer has become insolvent or has been placed into liquidationor receivership (whether voluntary or involuntary) or proceedings have beeninstituted against the Subscribing Reinsurer for the appointment of a receiver,liquidator, rehabilitator, conservator or trustee in bankruptcy, or other agentknown by whatever name, to take possession of its assets or control of itsoperations; or

7.                         TheSubscribing Reinsurer has reinsured its entire liability under this Contractwithout the Company’s prior written consent; or

8.                         TheSubscribing Reinsurer has ceased assuming new and renewal property treatyreinsurance business.

C.                        Ifthis Contract is terminated or expires while a loss occurrence coveredhereunder is in progress, the Reinsurer’s liability hereunder shall, subject tothe other terms and conditions of this Contract, be determined as if the entireloss occurrence had occurred prior to the termination or expiration of thisContract, provided that no part of such loss occurrence is claimed against anyrenewal or replacement of this Contract.

**Article III - Territory (BRMA 51A)**

The territorial limits of this Contract shall be identical with thoseof the Company’s policies.

**Article IV - Exclusions**

This Contract does not apply to and specifically excludes thefollowing:

Loss or damage occasioned by war, invasion,hostilities, acts of foreign enemies, civil war, rebellion, insurrection, militaryor usurped power, martial law or confiscation by order of any government orpublic authority, but not excluding loss or damage which would be covered undera standard form of policy containing a standard war exclusion clause.

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2.                         Nuclearrisks as defined in the “Nuclear Incident Exclusion Clause - Physical Damage -Reinsurance” attached to and forming part of this Contract.

3.                         Liabilityas a member, subscriber or reinsurer of any Pool, Syndicate or Association; andany combination of insurers or reinsurers formed for the purpose of coveringspecific perils, specific classes of business or for the purpose of insuringrisks located in specific geographical areas; but this exclusion shall notapply to FAIR Plans or to SIR Pool, Franklin Pool, Coastal Pools, Beach Plansor similar plans, however styled. It is understood and agreed, however, thatthis reinsurance does not include any increase in liability to the Companyresulting from (a) the inability of any other participant in a FAIR Plan, SIRPool, Franklin Pool, Coastal Pool, Beach Plan or similar plan to meet itsliability, or (b) any claim against such a FAIR Plan, SIR Pool, Franklin Pool,Coastal Pool, Beach Plan or similar plan, or any participant therein, includingthe Company, whether by way of subrogation or otherwise, brought by or onbehalf of any insolvency fund.

4.                         Financialguarantee and insolvency

5.                         Thirdparty liability

6.                         Allclasses of business not specifically listed in the Classes of BusinessReinsured Article.

7.                         Reinsuranceassumed, except pro rata local agency reinsurance on specific risks.

8.                         Ex-gratiapayments.

9.                         Risksexcluded under the provisions of the “Total Insured Value Clause” attached toand forming part of this Contract.

10.                   Allliability of the Company arising by contract, operation of law, or otherwise,from its participation or membership, whether voluntary or involuntary, in anyinsolvency 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 orassumption by the Company of part or all of any claim, debt, charge, fee orother obligation of an insurer, or its successors or assigns, which has beendeclared by any competent authority to be insolvent, or which is otherwisedeemed unable to meet any claim, debt, charge, fee or other obligation in wholeor in part.

11.                   Lossor liability excluded under the “Terrorism Exclusion Clause” attached to andforming part of this Contract.

12.                   Lossand/or damage and/or costs and/or expenses arising from Seepage and/orPollution and/or Contamination, other than contamination from Smoke Damage.Nevertheless, this exclusion does not preclude any payment of the cost of theremoval of debris of property damaged by a loss otherwise covered hereunder,but subject always to a limit of 25.0% of the Company’s property loss under theoriginal policy.

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**Article V - Retention and Limit**

A.                      Asrespects each excess layer of reinsurance coverage provided by this Contract,the Company shall retain and be liable for the first amount of ultimate netloss, shown as “Company’s Retention” for that excess layer in Schedule Aattached hereto, arising out of each loss occurrence. The Reinsurer shall thenbe liable, as respects each excess layer, for the percentage, shown as “Reinsurer’sPercentage” for that excess layer, of the amount by which such ultimate netloss exceeds the Company’s applicable retention, but the liability of theReinsurer under each excess layer shall not exceed the percentage, shown as “Reinsurer’sPercentage” for that excess layer, of the amount, shown as “Reinsurer’s PerOccurrence Limit” for that excess layer in Schedule A attached hereto, asrespects any one loss occurrence.

B.                        Noclaim shall be made under any excess layer of coverage provided by thisContract in any one loss occurrence unless at least two risks insured orreinsured by the Company are involved in such loss occurrence. For purposeshereof, the Company shall be the sole judge of what constitutes “one risk.”

C.                        Asrespects each excess layer of reinsurance coverage provided by this Contract,the Company shall retain, net and unreinsured elsewhere, in addition to itsinitial retention each loss occurrence, the percentage shown as “Company’sCoreinsurance” for that excess layer in Schedule A attached hereto, as respectsany one loss occurrence.

**Article VI - Reinstatement**

A.                      Inthe event all or any portion of the reinsurance under any excess layer ofreinsurance coverage provided by this Contract is exhausted by loss, the amountso exhausted shall be reinstated immediately from the time the loss occurrencecommences hereon. For each amount so reinstated the Company agrees to payadditional premium equal to the product of the following:

1.                         Thepercentage of the occurrence limit for the excess layer reinstated (based onthe loss paid by the Reinsurer under that excess layer); times

2.                         Theearned reinsurance premium for the excess layer reinstated for the term of thisContract (exclusive of reinstatement premium).

B.                        Wheneverthe Company requests payment by the Reinsurer of any loss under any excesslayer hereunder, the Company shall submit a statement to the Reinsurer ofreinstatement premium due the Reinsurer for that excess layer. If the earnedreinsurance premium for any excess layer for the term of this Contract has notbeen finally determined as of the date of any such statement, the calculationof reinstatement premium due for that excess layer shall be based on the annualdeposit premium for that excess layer and shall be readjusted when the earnedreinsurance premium for that excess layer for the term of this Contract hasbeen finally determined. Any reinstatement premium shown to be due theReinsurer for any excess layer as reflected by any such statement (less priorpayments, if any, for that excess layer) shall be payable by the Companyconcurrently with payment by the Reinsurer of the requested loss for thatexcess layer. Any return reinstatement premium shown to be due the Companyshall be remitted by the Reinsurer as promptly as possible after receipt andverification of the Company’s statement.

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C.                        Notwithstandinganything stated herein, the liability of the Reinsurer under any excess layerof reinsurance coverage provided by this Contract shall not exceed either ofthe following:

1                            Thepercentage, shown as “Reinsurer’s Percentage” for that excess layer, of theamount, shown as “Reinsurer’s Per Occurrence Limit” for that excess layer inSchedule A attached hereto, as respects loss or losses arising out of any oneloss occurrence; or

2                            Thepercentage, shown as “Reinsurer’s Percentage” for that excess layer, of theamount, shown as “Reinsurer’s Annual Limit” for that excess layer in Schedule Aattached hereto, in all during the term of this Contract.

**Article VII - Definitions**

A.                      “Ultimatenet loss” as used herein is defined as the sum or sums (including loss inexcess of policy limits, extra contractual obligations and loss adjustmentexpense, as hereinafter defined) paid or payable by the Company in settlementof claims and in satisfaction of judgments rendered on account of such claims,after deduction of all salvage, all recoveries and all claims on inuringinsurance or reinsurance, whether collectible or not. Nothing herein shall beconstrued to mean that losses under this Contract are not recoverable until theCompany’s ultimate net loss has been ascertained.

B.                        “Lossin excess of policy limits” and “extra contractual obligations” as used hereinshall be defined as follows:

1                            “Lossin excess of policy limits” shall mean 80.0% of any amount paid or payable bythe Company in excess of its policy limits, but otherwise within the terms ofits policy, such loss in excess of the Company’s policy limits having beenincurred because of, but not limited to, failure by the Company to settlewithin the policy limits or by reason of the Company’s alleged or actualnegligence, fraud or bad faith in rejecting an offer of settlement or in thepreparation of the defense or in the trial of an action against its insured orreinsured or in the preparation or prosecution of an appeal consequent uponsuch an action.

2                            “Extracontractual obligations” shall mean 80.0% of any punitive, exemplary,compensatory or consequential damages paid or payable by the Company, notcovered by any other provision of this Contract and which arise from thehandling of any claim on business subject to this Contract, such liabilitiesarising because of, but not limited to, failure by the Company to settle withinthe policy limits or by reason of the Company’s alleged or actual negligence,fraud or bad faith in rejecting an offer of settlement or in the preparation ofthe defense or in the trial of an action against its insured or reinsured or inthe preparation or prosecution of an appeal consequent upon such an action. Anextra contractual obligation shall be deemed, in all circumstances, to haveoccurred on the same date as the loss covered or alleged to be covered underthe policy.

The amount included inultimate net loss for any one loss occurrence as respects loss in excess ofpolicy limits and extra contractual obligations shall not exceed 25.0% of theCompany’s indemnity loss hereunder arising out of that loss occurrence.

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Notwithstanding anything stated herein, this Contractshall not apply to any loss in excess of policy limits or any extra contractualobligation incurred by the Company as a result of any fraudulent and/orcriminal act by any officer or director of the Company acting individually orcollectively or in collusion with any individual or corporation or any otherorganization or party involved in the presentation, defense or settlement ofany claim covered hereunder.

Savings Clause (Applicable only if the SubscribingReinsurer is domiciled in the State of New York): In no event shall coverage beprovided to the extent that such coverage is not permitted under New York law.

C                           “Lossadjustment expense” as used herein shall mean expenses assignable to theinvestigation, appraisal, adjustment, settlement, litigation, defense and/orappeal of specific claims, regardless of how such expenses are classified forstatutory purposes. Loss adjustment expense shall include, but not be limitedto, interest on judgments, expenses of outside adjusters, and declaratory judgmentexpenses or other legal expenses and costs incurred in connection with coveragequestions and legal actions connected thereto, but shall not include officeexpenses or salaries of the Company’s regular employees not classified as lossadjusters.

**Article VIII - Other Reinsurance**

A.                      TheCompany shall maintain in force property per risk excess of loss reinsurance,recoveries under which shall inure to the benefit of this Contract.

B                           TheCompany shall be permitted to carry underlying property catastrophe excess ofloss reinsurance, recoveries under which shall inure solely to the benefit ofthe Company and be entirely disregarded in applying all of the provisions ofthis Contract.

**Article IX - Loss Occurrence**

A.                      Theterm “loss occurrence” shall mean the sum of all individual losses directlyoccasioned by any one disaster, accident or loss or series of disasters,accidents or losses arising out of one event which occurs within the area ofone state of the United States or province of Canada and states or provincescontiguous thereto and to one another. However, the duration and extent of anyone “loss occurrence” shall be limited to all individual losses sustained bythe Company occurring during any period of 168 consecutive hours arising out ofand directly occasioned by the same event, except that the term “lossoccurrence” shall be further defined as follows:

As regards windstorm, hail, tornado, hurricane,cyclone, including ensuing collapse and water damage, all individual lossessustained by the Company occurring during any period of 72 consecutive hoursarising out of and directly occasioned by the same event. However, the eventneed not be limited to one state or province or states or provinces contiguousthereto.

2.                         Asregards riot, riot attending a strike, civil commotion, vandalism and maliciousmischief, all individual losses sustained by the Company occurring during anyperiod

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of 72 consecutive hours within the area of onemunicipality or county and the municipalities or counties contiguous thereto arisingout of and directly occasioned by the same event. The maximum duration of 72consecutive hours may be extended in respect of individual losses which occurbeyond such 72 consecutive hours during the continued occupation of an assured’spremises by strikers, provided such occupation commenced during the aforesaidperiod.

3.                         Asregards earthquake (the epicentre of which need not necessarily be within theterritorial confines referred to in paragraph A of this Article) and firefollowing directly occasioned by the earthquake, only those individual firelosses which commence during the period of 168 consecutive hours may beincluded in the Company’s “loss occurrence.”

4.                         Asregards “freeze,” only individual losses directly occasioned by collapse,breakage of glass and water damage (including, but not limited to, those causedby bursting frozen pipes and tanks) may be included in the Company’s “lossoccurrence.”

5.                         Asregards firestorms, brush fires and any other fires or series of fires,irrespective of origin (except as provided in subparagraphs 2 and 3 above),which spread through trees, grassland or other vegetation, all individuallosses sustained by the Company which occur during any period of 168consecutive hours within 150-mile radius of any one fixed point selected by theCompany may be included in the Company’s “loss occurrence.” However, anindividual loss subject to this subparagraph cannot be included in more thanone “loss occurrence.”

B.                        Exceptfor those “loss occurrences,” referred to in subparagraphs 1 and 2 of paragraphA above, the Company may choose the date and time when any such period ofconsecutive hours commences, provided that it is not earlier than the date andtime of the occurrence of the first recorded individual loss sustained by theCompany arising out of that disaster, accident or loss, and provided that onlyone such period of 168 consecutive hours shall apply with respect to one event.

C.                        Asrespects those “loss occurrences” referred to in subparagraphs 1 and 2 ofparagraph A above, if the disaster, accident or loss occasioned by the event isof greater duration than 72 consecutive hours, then the Company may divide thatdisaster, accident or loss into two or more “loss occurrences,” provided no twoperiods overlap and no individual loss is included in more than one such periodand provided that no period commences earlier than the date and time of theoccurrence of the first recorded individual loss sustained by the Companyarising out of that disaster, accident or loss.

D.                       Noindividual losses occasioned by an event that would be covered by 72 hoursclauses may be included in any “loss occurrence” claimed under the 168 hoursprovision.

E.                         Anydate change, including leap-year calculations, shall not in and of itself beregarded as an event for purposes of this Contract.

1.                         Thisincludes any loss, damage, cost, claim or expense, whether preventative,remedial or otherwise, directly or indirectly arising out of or relating to:

a.                          Thecalculation, comparison, differentiation, sequencing or processing of datainvolving a date change, including leap-year calculations, by any computer

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system, hardware, program or software and/or anymicrochip, integrated circuit or similar device in computer equipment ornon-computer equipment, whether the property of the insured or not; or

b.                         Anychange, alteration or modification involving a date change, including leap-yearcalculations, to any such computer system, hardware, program or software or anymicrochip, integrated circuit or similar device in computer equipment ornon-computer equipment, whether the property of the insured or not.

This subparagraph shall apply regardless of any othercause or event that contributes concurrently or in any sequence to the loss,damage, cost, claim or expense.

However, this subparagraph shall not apply as respectsphysical damage occurring at the insured’s premises arising out of the perilscovered under this Contract.

2.                         Notwithstandingsubparagraph 1 above, this Contract shall not cover any costs and expenses,whether preventative, remedial or otherwise, arising out of or relating tochange, alteration or modification of any computer system, hardware, program orsoftware or any microchip, integrated circuit or similar device in computer ornon-computer equipment, whether the property of the insured or not.

F.**                        **Lossesarising, directly or indirectly, out of:

1.                         Lossof, alteration of, or damage to;

or

2.                         Areduction in the functionality, availability or operation of

A computer system, hardware, program, software, data,information repository, microchip, integrated circuit or similar device incomputer equipment or non-computer equipment, whether the property of thepolicyholder of the Company or not, do not in and of themselves constitute anevent unless arising out of one or more of the following perils:

Fire, lightning, explosion, aircraft or vehicleimpact, falling objects, windstorm, hail, tornado, cyclone, hurricane,earthquake, volcano, tsunami, flood, freeze or weight of snow.

**Article X - Loss Notices and Settlements**

A.                      Wheneverlosses sustained by the Company appear likely to result in a claim hereunder,the Company shall notify the Reinsurer, and the Reinsurer shall have the rightto participate in the adjustment of such losses at its own expense.

B.                        Allloss settlements made by the Company, provided they are within the terms ofthis Contract, shall be binding upon the Reinsurer, and the Reinsurer agrees topay all amounts for which it may be liable upon receipt of reasonable evidenceof the amount paid (or scheduled to be paid, but no more than 10 days inadvance of the date of payment of claims) by the Company.

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**Article XI - Salvage andSubrogation**

The Reinsurer shall be credited with salvage (i.e., reimbursementobtained or recovery made by the Company, less the actual cost, excludingsalaries of officials and employees of the Company and sums paid to attorneysas retainer, of obtaining such reimbursement or making such recovery) onaccount of claims and settlements involving reinsurance hereunder. Salvage thereonshall always be used to reimburse the excess carriers in the reverse order oftheir priority according to their participation before being used in any way toreimburse the Company for its primary loss. The Company hereby agrees toenforce its rights to salvage or subrogation relating to any loss, a part ofwhich loss was sustained by the Reinsurer, and to prosecute all claims arisingout of such rights.

**Article XII - ReinsurancePremium**

A.                      As premium for each excess layer of reinsurance coverage provided by thisContract, the Company shall pay the Reinsurer the greater of the following:

1.                         Theamount, shown as “Minimum Premium” for that excess layer in Schedule A attachedhereto (or a pro rata portion of the Subscribing Reinsurer’s share, in the eventthat such Subscribing Reinsurer’s share under any excess layer is terminatedprior to January 1, 2007); or

2.                         Thepercentage, shown as “Premium Rate” for that excess layer in Schedule Aattached hereto, of the Company’s net earned premium for the term of thisContract

B.                        TheCompany shall pay the Reinsurer an deposit premium for each excess layer of theamount, shown as “Deposit Premium” for that excess layer in Schedule A attachedhereto, in four equal installments of the amount, shown as “Quarterly DepositPremium” for that excess layer in Schedule A attached hereto, on January 1,April 1, July 1 and October 1 of 2006. In the event that a SubscribingReinsurer’s share under any excess layer hereof is terminated prior to January1, 2007, no quarterly deposit installments for such layer(s) shall be due tosuch Subscribing Reinsurer after the effective date of termination.

C.                        Within60 days after the termination or expiration of this Contract, the Company shallprovide a report to the Reinsurer setting forth the premium due hereunder foreach excess layer, computed in accordance with paragraph A, and any additionalpremium due the Reinsurer or return premium due the Company for each suchexcess layer shall be remitted promptly.

D.                       “Net earned premium” as used herein is defined as gross earned premium of theCompany for the classes of business reinsured hereunder, less the earnedportion of premiums ceded by the Company for reinsurance which inures to thebenefit of this Contract. For purposes of calculating net earned premium, 90.0%of Homeowners Multiple Peril and 80.0% of Commercial Multiple Peril total basicpolicy premium on indivisible premium policies shall be considered subjectpremium.

9

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**Article XIII - LatePayments**

A.                      Theprovisions of this Article shall not be implemented unless specificallyinvoked, in writing, by one of the parties to this Contract.

B.                        Inthe event any premium, loss or other payment due either party is not receivedby the Intermediary named in the Intermediary Article (BRMA 23A) (hereinafterreferred to as the “Intermediary”) by the payment due date, the party to whompayment is due may, by notifying the Intermediary in writing, require thedebtor party to pay, and the debtor party agrees to pay, an interest penalty onthe amount past due calculated for each such payment on the last business dayof each month as follows:

1                            Thenumber of full days which have expired since the due date or the last monthly calculation,whichever the lesser; times

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

3                            Theamount past due, including accrued interest.

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

C.                        Theestablishment of the due date shall, for purposes of this Article, bedetermined as follows:

1.                         Asrespects the payment of routine deposits and premiums due the Reinsurer, thedue 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, itshall be deemed due 30 business days after the date of transmittal by theIntermediary of the initial billing for each such payment.

2.                         Anyclaim or loss payment due the Company hereunder shall be deemed due 30 businessdays after the proof of loss or demand for payment is transmitted to theReinsurer. If such loss or claim payment is not received within the 30 businessdays, interest will accrue on the payment or amount overdue in accordance withparagraph B above, from the date the proof of loss or demand for payment wastransmitted to the Reinsurer.

3.                         Asrespects any payment, adjustment or return due either party not otherwiseprovided for in subparagraphs 1 and 2 of this paragraph, the due date shall beas provided for in the applicable section of this Contract. In the event a duedate is not specifically stated for a given payment, it shall be deemed due 30business days following transmittal of written notification that the provisionsof this Article have been invoked.

For purposes of interest calculations only, amounts due hereunder shallbe deemed paid upon receipt by the Intermediary.

D.                       Nothingherein shall be construed as limiting or prohibiting a Subscribing Reinsurerfrom contesting the validity of any claim, or from participating in the defenseof any claim or suit

10

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or prohibiting either party from contesting the validity of any paymentor from initiating any arbitration or other proceeding in accordance with theprovisions of this Contract. If the debtor party prevails in an arbitration orother proceeding, then any interest penalties due hereunder on the amount indispute 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 becalculated in accordance with the provisions set forth above unless otherwisedetermined by such proceedings. If a debtor party advances payment of anyamount it is contesting, and proves to be correct in its contestation, eitherin whole or in part, the other party shall reimburse the debtor party for anysuch excess payment made plus interest on the excess amount calculated inaccordance with this Article.

E.                         Interestpenalties arising out of the application of this Article that are $100 or lessfrom any party shall be waived unless there is a pattern of late paymentsconsisting of three or more items over the course of any 12-month period.

**Article XIV - Offset(BRMA 36C)**

The Company and the Reinsurer shall have the right to offset anybalance or amounts due from one party to the other under the terms of thisContract. The party asserting the right of offset may exercise such right anytime whether the balances due are on account of premiums or losses orotherwise.

**Article XV - Access toRecords (BRMA**1D)

The Reinsurer or its designated representatives shall have access atany reasonable time to all records of the Company which pertain in any way tothis reinsurance.

**Article XVI - NetRetained Lines**(BRMA32E)

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

B.                        Theamount of the Reinsurer’s liability hereunder in respect of any loss or lossesshall not be increased by reason of the inability of the Company to collectfrom any other reinsurer(s), whether specific or general, any amounts which mayhave become due from such reinsurer(s), whether such inability arises from theinsolvency of such other reinsurer(s) or otherwise.

**Article XVII - Liabilityof the Reinsurer**

A                       Theliability of the Reinsurer shall follow that of the Company in every case andbe subject in all respects to all the general and specific stipulations,clauses, waivers and modifications of the Company’s policies and anyendorsements thereon. However, in no event shall this

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be construed in any way to provide coverage outside the terms andconditions set forth in this Contract.

B.                        Nothingherein shall in any manner create any obligations or establish any rightsagainst the Reinsurer in favor of any third party or any persons not parties tothis Contract.

**Article XVIII - Errors and Omissions (BRMA 14F)**

Inadvertent delays, errors or omissions made in connection with thisContract or any transaction hereunder shall not relieve either party from anyliability which would have attached had such delay, error or omission notoccurred, provided always that such error or omission is rectified as soon aspossible after discovery.

**Article XIX - Currency (BRMA 12A)**

A.                      Wheneverthe word “Dollars” or the “$”**signappears in this Contract, they shall be construed to mean United States Dollarsand all transactions under this Contract shall be in United States Dollars.

B.                        Amountspaid or received by the Company in any other currency shall be converted toUnited States Dollars at the rate of exchange at the date such transaction isentered on the books of the Company.

**Article XX - Taxes (BRMA 50B)**

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

**Article XXI - Federal Excise Tax**

A.                      TheReinsurer has agreed to allow for the purpose of paying the Federal Excise Taxthe applicable percentage of the premium payable hereon (as imposed underSection 4371 of the Internal Revenue Code) to the extent such premium issubject to the Federal Excise Tax.

B.                        Inthe event of any return of premium becoming due hereunder the Reinsurer willdeduct the applicable percentage from the return premium payable hereon and theCompany or its agent should take steps to recover the tax from the UnitedStates Government.

**Article XXII - Unauthorized Reinsurers**

A.                      Ifthe Reinsurer is unauthorized in any state of the United States of America orthe District of Columbia, the Reinsurer agrees to fund its share of the Company’sceded United States

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outstanding loss and loss adjustment expense reserves (including allcase reserves plus any reasonable amount estimated to be unreported from knownloss occurrences) by:

Clean, irrevocable and unconditional letters of creditissued and confirmed, if confirmation is required by the insurance regulatoryauthorities involved, by a bank or banks meeting the NAIC Securities Valuation Officecredit standards for issuers of letters of credit and acceptable to saidinsurance regulatory authorities; and/or

2.                         Escrowaccounts for the benefit of the Company; and/or

3.                         Cashadvances;

If, without such funding, a penalty would accrue to the Company on anyfinancial statement it is required to file with the insurance regulatoryauthorities involved. The Reinsurer, at its sole option, may fund in other thancash if its method and form of funding are acceptable to the insuranceregulatory authorities involved.

B.                        Withregard to funding in whole or in part by letters of credit, it is agreed thateach letter of credit will be in a form acceptable to insurance regulatoryauthorities involved, will be issued for a term of at least one year and willinclude an “evergreen clause,” which automatically extends the term for atleast one additional year at each expiration date unless written notice ofnon-renewal is given to the Company not less than 30 days prior to saidexpiration date. The Company and the Reinsurer further agree, notwithstandinganything to the contrary in this Contract, that said letters of credit may bedrawn upon by the Company or its successors in interest at any time, withoutdiminution because of the insolvency of the Company or the Reinsurer, but onlyfor one or more of the following purposes:

1.                         Toreimburse itself for the Reinsurer’s share of losses and/or loss adjustmentexpense paid under the terms of policies reinsured hereunder, unless paid incash by the Reinsurer;

2.                         Toreimburse itself for the Reinsurer’s share of any other amounts claimed to bedue hereunder, unless paid in cash by the Reinsurer;

3.                         Tofund a cash account in an amount equal to the Reinsurer’s share of any cededoutstanding loss and loss adjustment expense reserves (including all casereserves plus any reasonable amount estimated to be unreported from known lossoccurrences) funded by means of a letter of credit which is under non-renewalnotice, if said letter of credit has not been renewed or replaced by the Reinsurer10 days prior to its expiration date;

4.                         Torefund to the Reinsurer any sum in excess of the actual amount required to fundthe Reinsurer’s share of the Company’s ceded outstanding loss and lossadjustment expense reserves (including all case reserves plus any reasonableamount estimated to be unreported from known loss occurrences), if so requestedby the Reinsurer.

In the event the amount drawn by the Company on any letter of credit isin excess of the actual amount required for B(1) or B(3), or in the case ofB(2), the actual amount determined to be due, the Company shall promptly returnto the Reinsurer the excess amount so drawn.

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**Article XXIII - Insolvency**

A.                      Inthe event of the insolvency of one or both of the reinsured companies, thisreinsurance shall be payable directly to the company or to its liquidator,receiver, conservator or statutory successor on the basis of the liability ofthe company without diminution because of the insolvency of the company orbecause the liquidator, receiver, conservator or statutory successor of thecompany has failed to pay all or a portion of any claim. It is agreed, however,that the liquidator, receiver, conservator or statutory successor of thecompany Shall give written notice to the Reinsurer of the pendency of a claimagainst the company indicating the policy or bond reinsured which claim wouldinvolve a possible liability on the part of the Reinsurer within a reasonabletime after such claim is filed in the conservation or liquidation proceeding orin the receivership, and that during the pendency of such claim, the Reinsurermay investigate such claim and interpose, at its own expense, in the proceedingwhere such claim is to be adjudicated, any defense or defenses that it may deemavailable to the company or its liquidator, receiver, conservator or statutorysuccessor. The expense thus incurred by the Reinsurer shall be chargeable,subject to the approval of the Court, against the company as part of theexpense of conservation or liquidation to the extent of a pro rata share of thebenefit which may accrue to the company solely as a result of the defenseundertaken by the Reinsurer.

B.                        Wheretwo or more reinsurers are involved in the same claim and a majority ininterest elect to interpose defense to such claim, the expense shall beapportioned in accordance with the terms of this Contract as though suchexpense had been incurred by the company.

C.                        Itis further understood and agreed that, in the event of the insolvency of one orboth of the reinsured companies, the reinsurance under this Contract shall bepayable directly by the Reinsurer to the company or to its liquidator, receiveror statutory successor, except as provided by Section 4118(a) of the New YorkInsurance Law or except (1) where this Contract specifically provides anotherpayee 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 hasassumed such policy obligations of the company as direct obligations of theReinsurer to the payees under such policies and in substitution for theobligations of the company to such payees.

**Article XXIV - Arbitration**

A.                      Asa condition precedent to any right of action hereunder, in the event of anydispute or difference of opinion hereafter arising with respect to thisContract, it is hereby mutually agreed that such dispute or difference ofopinion shall be submitted to arbitration. One Arbiter shall be chosen by theCompany, the other by the Reinsurer, and an Umpire shall be chosen by the twoArbiters before they enter upon arbitration, all of whom shall be active orretired disinterested executive officers of insurance or reinsurance companiesor Lloyd’s London Underwriters. In the event that either party should fail to choosean Arbiter within 30 days following a written request by the other party to doso, the requesting party may choose two Arbiters who shall in turn choose anUmpire before entering upon arbitration. If the two Arbiters fail to agree uponthe selection of an Umpire within 30 days following their appointment, the twoArbiters shall request the American Arbitration Association to appoint theUmpire. If the American Arbitration Association fails to appoint the Umpirewithin

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30 days after it has been requested to do so, either party may requesta justice of a Court of general jurisdiction of the state in which thearbitration is to be held to appoint the Umpire.

B.                        Eachparty shall present its case to the Arbiters within 30 days following the dateof appointment of the Umpire. The Arbiters shall consider this Contract as anhonorable engagement rather than merely as a legal obligation and they arerelieved of all judicial formalities and may abstain from following the strictrules of law. The decision of the Arbiters shall be final and binding on bothparties; but failing to agree, they shall call in the Umpire and the decisionof the majority shall be final and binding upon both parties. Judgment upon thefinal decision of the Arbiters may be entered in any court of competentjurisdiction.

C.                        Ifmore than one reinsurer is involved in the same dispute, all such reinsurersshall constitute and act as one party for purposes of this Article andcommunications shall be made by the Company to each of the reinsurers constitutingone party, provided, however, that nothing herein shall impair the rights ofsuch reinsurers to assert several, rather than joint, defenses or claims, norbe construed as changing the liability of the reinsurers participating underthe terms of this Contract from several to joint.

D.                       Eachparty shall bear the expense of its own Arbiter, and shall jointly****and equally bear with the other theexpense of the Umpire and of the arbitration. In the event that the twoArbiters are chosen by one party, as above provided, the expense of theArbiters, the Umpire and the arbitration shall be equally divided between thetwo parties.

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

**Article XXV - Service ofSuit (BRMA 49C)**

(Applicable if the Reinsurer is not domiciled in the United States ofAmerica, and/or is not authorized in any State, Territory or District of theUnited States where authorization is required by insurance regulatoryauthorities)

A.                      Itis agreed that in the event the Reinsurer fails to pay any amount claimed to bedue hereunder, the Reinsurer, at the request of the Company, will submit to theJurisdiction of a court of competent jurisdiction within the United States.Nothing in this Article constitutes or should be understood to constitute awaiver of the Reinsurer’s rights to commence an action in any court ofcompetent jurisdiction in the United States, to remove an action to a UnitedStates District Court, or to seek a transfer of a case to another court aspermitted 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 UnitedStates which makes provision therefor, the Reinsurer hereby designates theparty named in its Interests and Liabilities Agreement, or if no party is namedtherein, the Superintendent, Commissioner or Director of Insurance or otherofficer specified for that purpose in the statute, or his successor orsuccessors in office, as its true and lawful attorney upon whom may be servedany lawful process in any action, suit or proceeding instituted by or on behalfof the Company or any beneficiary hereunder arising out of this Contract.

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**Article XXVI**- **Governing Law**

This Contract shall be governed by and construed inaccordance with the law of the Commonwealth of Massachusetts.

**Article XXVII - Agency Agreement**

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

**Article XXVIII - Severability (BRMA72E)**

If any provision of thisContract shall be rendered illegal or unenforceable by the laws, regulations orpublic policy of any state, such provision shall be considered void in suchstate, but this shall not affect the validity or enforceability of any otherprovision of this Contract or the enforceability of such provision in any otherjurisdiction.

**ArticleXXIX - Intermediary (BRMA 23A)**

Benfield Inc. is herebyrecognized as the Intermediary negotiating this Contract for all businesshereunder. All communications (including but not limited to notices,statements, premium, return premium, commissions, taxes, losses, lossadjustment expense, salvages and loss settlements) relating thereto shall betransmitted to the Company or the Reinsurer through Benfield Inc. Payments bythe Company to the Intermediary shall be deemed to constitute payment to theReinsurer. Payments by the Reinsurer to the Intermediary shall be deemed toconstitute payment to the Company only to the extent that such payments areactually received by the Company.

**InWitness Whereof,**the Company by its duly authorized representativehas executed this Contract as of the date undermentioned at:

Boston, Massachusetts, this 9th day of Jan. in the year 2006.
|        | /s/ [Illegible]                    |   |
|--------|------------------------------------|--------|
|   | Safety Insurance Company           |
|   | Safety Indemnity Insurance Company |

 

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# **ScheduleA**

**ExcessCatastropheReinsurance ContractEffective: January 1, 2006**

**issued to**

**SafetyInsurance CompanyandSafety Indemnity Insurance Companyboth of Boston, Massachusetts**
| ****                                   | ** ** | **Third   Excess** | ** ** | **Fourth   Excess** | ** ** |
|----------------------------------------|------------|-------------------------|------------|--------------------------|------------|
| Company’s Coreinsurance           |       | 10.0                    | %          | 10.0                     | %          |
| Reinsurer’s Percentage            |       | 90.0                    | %          | 90.0                     | %          |
| Company’s Retention               |       | $                       | 30,000,000 |                     | $          | 60,000,000 |   |
| Reinsurer’s Per  Occurrence Limit |       | $                       | 30,000,000 |                     | $          | 190,000,000 |   |
| Reinsurer’s Annual  Limit         |       | $                       | 60,000,000 |                     | $          | 380,000,000 |   |
| Minimum Premium                        |       | $                       | 1,980,000  |                     | $          | 4,940,000 |   |
| Adjustable Premium Rate                |       | 2.226                   | %          | 5.553                    | %          |
| Deposit Premium                        |       | $                       | 2,475,000  |                     | $          | 6,175,000 |   |
| Quarterly Deposit Premium              |       | $                       | 618,750    |                     | $          | 1,543,750 |   |

The figures listed abovefor each excess layer shall apply to each Subscribing Reinsurer in thepercentage share for that excess layer as expressed in its Interests andLiabilities Agreement attached hereto.

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**Nuclear Incident Exclusion Clause - Physical Damage -Reinsurance (U.S.A.)**

This Reinsurance does not cover any loss or liability accruing to theReassured, directly or indirectly and whether as Insurer or Reinsurer, from anyPool of Insurers or Reinsurers formed for the purpose of covering Atomic orNuclear Energy risks.

2.                          Withoutin any way restricting the operation of paragraph (1) of this Clause, thisReinsurance does not cover any loss or liability accruing to the Reassured,directly or indirectly and whether as insurer or Reinsurer, from any insuranceagainst Physical Damage (including business interruption or consequential lossarising out of such Physical Damage) to:

Nuclear reactor power plants including all auxiliaryproperty on the site, or

II.                       Anyother nuclear reactor installation, including laboratories handling radioactivematerials in connection with reactor installations, and “critical facilities”as such, or

III.                   Installationsfor fabricating complete fuel elements or for processing substantial quantitiesof “special nuclear material,” and for reprocessing, salvaging, chemicallyseparating, storing or disposing of “spent” nuclear fuel or waste materials, or

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

3.                          Withoutin any way restricting the operations of paragraphs (1) and (2) hereof, thisReinsurance does not cover any loss or liability by radioactive contaminationaccruing to the Reassured, directly or indirectly, and whether as Insurer orReinsurer, from any insurance on property which is on the same site as anuclear reactor power plant or other nuclear installation and which normallywould be insured therewith except that this paragraph (3) shall not operate

(a)                    whereReassured does not have knowledge of such nuclear reactor power plant ornuclear installation, or

(b)                   wheresaid insurance contains a provision excluding coverage for damage to propertycaused by or resulting from radioactive contamination, however caused. Howeveron and after 1st January 1960 this sub-paragraph (b) shall only apply providedthe said radioactive contamination exclusion provision has been approved by theGovernmental Authority having jurisdiction thereof.

4.                          Withoutin any way restricting the operations of paragraphs (1), (2) and (3) hereof,this Reinsurance does not cover any loss or liability by radioactive contaminationaccruing to the Reassured, directly or indirectly, and whether as Insurer orReinsurer, when such radioactive contamination is a named hazard specificallyinsured against.

5.                          Itis understood and agreed that this Clause shall not extend to risks usingradioactive isotopes in any form where the nuclear exposure is not consideredby the Reassured to be the primary hazard.

6.                          Theterm “special nuclear material” shall have the meaning given it in the AtomicEnergy Act of 1954 or by any law amendatory thereof.

7.                          Reassuredto be sole judge of what constitutes:

(a)                    substantialquantities, and

(b)                   theextent of installation, plant or site.

*Note*.-Without in any wayrestricting the operation of paragraph (1) hereof, it is understood and agreedthat

(a)                    allpolicies issued by the Reassured on or before 31st December 1957 shall be freefrom the application of the other provisions of this Clause until expiry dateor 31st December 1960 whichever first occurs whereupon all the provisions ofthis Clause shall apply.

(b)                   withrespect to any risk located in Canada policies issued by the Reassured on orbefore 31st December 1958 shall be free from the application of the otherprovisions of this Clause until expiry date or 31st December 1960 whicheverfirst occurs whereupon all the provisions of this Clause shall apply.

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**TotalInsured Value Exclusion Clause**

It is the mutualintention of the parties to exclude risks, other than Offices, Hotels,Apartments, Hospitals, Educational Establishments and Public Utilities (exceptRailroad Schedules), and Builders Risks on the above classes, where at the timeof cession, the Total Insured Value over all interests exceeds $250,000,000.However, the Company shall be protected hereunder, subject to the other termsand conditions of this Contract, if subsequent to cession being made, theCompany becomes acquainted with the true facts of the case and discovers thatthe mutual intention has been inadvertently breached; on condition that theCompany shall at the first opportunity, and certainly by next anniversary ofthe original policy, exclude the risk in question.

It is agreed that thismutual intention does not apply to Contingent Business Interruption or to intereststraditionally underwritten as Inland Marine or to Stock and/or Contents writtenon a blanket basis except where the Company is aware that the Total InsuredValue of $250,000,000 is already exceeded for buildings, machinery, equipmentand direct use and occupancy at the key location.

It is understood andagreed that this Clause shall not apply hereunder where the Company writes 100%of the risk.

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**TerrorismExclusion Clause**

A.                      Notwithstandingany provision to the contrary within this Contract or any addendum thereto, itis agreed that this Contract excludes loss, damage, cost or expense directly orindirectly caused by, contributed to by, resulting from, arising out of or inconnection with any “act of terrorism,” as defined in the Terrorism RiskInsurance Act of 2002, as amended by the Terrorism Risk Insurance Extension Actof 2005 (together the “Terrorism Act”), on primary or excess property andcasualty insurance issued by the Company, regardless of any other cause orevent contributing concurrently or in any sequence to the loss.

B.                        Notwithstandingthe above and subject otherwise to the terms, conditions and limitations ofthis Contract, this Contract will pay actual loss or damage caused by any actof terrorism which does not meet the definition of “insured loss” set forth inthe Terrorism Act or meets the definition of “insured loss” as set forth in theTerrorism Act, but results in loss under a policy that is not included in “propertyand casualty insurance” as defined in the Terrorism Act, provided, in eithercase, (1) such loss or damage occurs in a line of insurance otherwise coveredby this Contract, and (2) in no event will this Contract provide coverage forloss, damage, cost or expense directly or indirectly caused by, contributed toby, resulting from, or arising out of or in connection with biological,chemical, radioactive or nuclear explosion, pollution, contamination and/orfire following thereon.

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**Interestsand Liabilities Agreement**

**of**

**American Agricultural Insurance Company**Indianapolis, Indiana(*hereinafter referred to as the “SubscribingReinsurer”*)

**with respect to the**

**Excess Catastrophe Reinsurance Contract Effective: January 1, 2006**

**issued to and duly executed by**

**Safety Insurance CompanyandSafety Indemnity Insurance Companyboth of Boston, Massachusetts**

The *Subscribing Reinsurer*hereby accepts thefollowing percentage shares in the interests and liabilities of the “Reinsurer”as set forth in the attached Contract captioned above:

0.900%                of the Third Excess CatastropheReinsurance

0.900%                of the Fourth Excess CatastropheReinsurance

This Agreement shall becomeeffective at 12:01 a.m., Eastern Standard Time, January 1, 2006 and shallcontinue in force until 12:01 a.m., Eastern Standard Time, January 1, 2007,unless earlier terminated in accordance with the provisions of the attachedContract.

The *Subscribing Reinsurer’s*share in theattached Contract shall be separate and apart from the shares of the otherreinsurers, and shall not be joint with the shares of the other reinsurers itbeing understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**InWitness Whereof,** the *SubscribingReinsurer*by**its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Columbus, Ohio, this 12th day of January in the year 2006.
|   | /s/ Virgil R. Maxwell                   |
|--------|-----------------------------------------|
|   | American Agricultural Insurance Company |
|   |                                    |
|   |                                    | Virgil R. Maxwell  Vice President-Domestic Underwriting |

 

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**Interests and LiabilitiesAgreement**

**of**

**American Re-Insurance CompanyA Delaware Corporation(*hereinafter referred to as the “SubscribingReinsurer”*)**

**with respect to the**

**Excess CatastropheReinsurance ContractEffective: January 1, 2006**

**issued to and duly executed by**

**Safety Insurance CompanyandSafety Indemnity Insurance Companyboth of Boston, Massachusetts**

The *Subscribing Reinsurer*hereby accepts thefollowing percentage shares in the interests and liabilities of the “Reinsurer”as set forth in the attached Contract captioned above:

3.000%      ofthe Third Excess Catastrophe Reinsurance3.000%      of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *Subscribing Reinsurer’s*share in theattached Contract shall be separate and apart from the shares of the otherreinsurers, and shall not be joint with the shares of the other reinsurers, itbeing understood that the *Subscribing Reinsurer*shall in no event participate in the interests and liabilities ofthe other reinsurers.

**InWitness Whereof,**the *SubscribingReinsurer*by its duly authorized representative has executed thisAgreement as of the date undermentioned at:

Princeton, New Jersey,this 2nd day of March in the year 2006.
|   | /s/ Illegible                                          |
|--------|--------------------------------------------------------|
|   | American Re-Insurance Company, A Delaware  Corporation |

 

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**Interests and LiabilitiesAgreement**

**of**

**Aspen Insurance UK LimitedLondon, England(*hereinafter referred to as**the “Subscribing Reinsurer*”)**

**with respect to the**

**Excess CatastropheReinsurance ContractEffective: January 1, 2006**

**issued to and duly executed by**

**Safety Insurance Company**

and

Safety Indemnity Insurance Companyboth of Boston, Massachusetts

The *Subscribing Reinsurer*herebyaccepts the following percentage shares in the interests and liabilities of the“Reinsurer” as set forth in the attached Contract captioned above:

4.000%      of the Third Excess CatastropheReinsurance2.500%      of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *Subscribing Reinsurer’s*share in theattached Contract shall be separate and apart from the shares of the otherreinsurers, and shall not be joint with the shares of the other reinsurers, itbeing understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**In****Witness Whereof,**the *Subscribing Reinsurer* by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Hamilton, Bermuda, this 13th day of January in the year 2006.
|   | /s/ Illegible              |
|--------|----------------------------|
|   | Aspen Insurance UK Limited |

 

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**Interestsand Liabilities Agreement**

of

Catlin InsuranceCompany Ltd.

Hamilton, Bermuda

(*hereinafter referred to as the “Subscribing Reinsurer”*)

with respect tothe

**ExcessCatastrophe**

**ReinsuranceContract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety Insurance Company

and

Safety IndemnityInsurance Company

both of Boston,Massachusetts

The *Subscribing Reinsurer*herebyaccepts the following percentage shares in the interests and liabilities of the“Reinsurer” as set forth in the attached Contract captioned above:

1.500%   of theThird Excess Catastrophe Reinsurance

1.500%   of theFourth Excess Catastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *Subscribing Reinsurer’s*share in theattached Contract shall be separate and apart from the shares of the otherreinsurers, and shall not be joint with the shares of the other reinsurers, itbeing understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**InWitness Whereof**, the *SubscribingReinsurer*by its duly authorized representative has executed thisAgreement as of the date undermentioned at:

Hamilton, Bermuda, this12th day of January in the year 2006
|        | /s/ Illegible                 |
|--------|-------------------------------|
|   | Catlin Insurance Company Ltd. |

 

**CatlinInusrance**

**CompanyLtd.**

All amendments,[Illegible] and claims to be agreed.

----

**Interestsand Liabilities Agreement**

of

Federal InsuranceCompany

Indianapolis,Indiana

through

Harbor PointServices Inc.

Bernardsville, NewJersey

(*hereinafter referred to as the “Subscribing Reinsurer”*)

with respect tothe

**ExcessCatastrophe**

**ReinsuranceContract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety InsuranceCompany

and

Safety IndemnityInsurance Company

both of Boston,Massachusetts

The *Subscribing Reinsurer*hereby**accepts the following percentage sharesin the interests and liabilities of the “Reinsurer” as set forth in theattached Contract captioned above:

5.000%   of the Third Excess Catastrophe Reinsurance

5.000%   of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *Subscribing Reinsurer’s*share in theattached Contract shall be separate and apart from the shares of the otherreinsurers, and shall not be joint with the shares of the other reinsurers, itbeing understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**InWitness Whereof**, the *SubscribingReinsurer*by its duly authorized representative has executed thisAgreement as of the date undermentioned at:

Bernardsville, NewJersey, this 13th day of January in the year 2006.
|        | /s/ Julia D. Hassan                                                                           |
|--------|-----------------------------------------------------------------------------------------------|
|   | Harbor Point Services Inc. (for and on behalf of  Federal Insurance  Company) Julia D. Hassan |

Reference Nos.: T806& T807

----

**Interestsand Liabilities Agreement**

of

Da Vinci Reinsurance Ltd.

Hamilton, Bermuda

*(hereinafterreferred to as the “Subscribing Reinsurer”)*

with respect tothe

**ExcessCatastrophe**

**ReinsuranceContract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety InsuranceCompany

and

Safety IndemnityInsurance Company

both of Boston,Massachusetts

The *Subscribing Reinsurer*hereby accepts thefollowing percentage shares in the interests and liabilities of the “Reinsurer”as set forth in the attached Contract captioned above:

2.400%   of the Third Excess Catastrophe Reinsurance

2.000%   of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *Subscribing Reinsurer’s*share in theattached Contract shall be separate and apart from the shares of the otherreinsurers, and shall not be joint with the shares of the other reinsurers, itbeing understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**InWitness Whereof**, the *SubscribingReinsurer*by its duly authorized representative has executed thisAgreement as of the date undermentioned at:

Hamilton, Bermuda, this12th day of January in the year 2006
|        | /s/ Illegible             |
|--------|---------------------------|
|   | Da Vinci Reinsurance Ltd. |

 

**DAVINCIREINSURANCE LTD.**

**UNDERWRITTENBY RENAISSANCE U/W MGRS.**

----

**Interestsand Liabilities Agreement**

of

Endurance SpecialtyInsurance Ltd.

Hamilton, Bermuda

*(hereinafterreferred to as the “Subscribing Reinsurer”)*

with respect to the

**Excess Catastrophe**

**Reinsurance Contract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety Insurance Company

and

Safety IndemnityInsurance Company 

both of Boston,Massachusetts

The *SubscribingReinsurer* hereby accepts the following percentage shares in theinterests and liabilities of the “Reinsurer” as set forth in the attachedContract captioned above:

3.500%   of the Third Excess Catastrophe Reinsurance

3.500%   of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *SubscribingReinsurer’s* share in the attached Contract shall be separate andapart from the shares of the other reinsurers, and shall not be joint with theshares of the other reinsurers, it being understood that the *Subscribing Reinsurer* shall in no event participate in theinterests and liabilities of the other reinsurers.

**In Witness Whereof,**the *Subscribing Reinsurer* by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Hamilton, Bermuda, this12th day of January in the year 2006.
|   | /s/ Illegible                       |
|--------|-------------------------------------|
|   | Endurance  Specialty Insurance Ltd. |

 

----

**Interestsand Liabilities Agreement**

of

Folksamerica ReinsuranceCompany

New York, New York

*(hereinafterreferred to as the “Subscribing Reinsurer”)*

with respect tothe

**Excess Catastrophe**

**Reinsurance Contract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety Insurance Company

and

Safety IndemnityInsurance Company

both of Boston,Massachusetts

The *SubscribingReinsurer* hereby accepts the following percentage shares in theinterests and liabilities of the “Reinsurer” as set forth in the attachedContract captioned above:

3.000%   of the Third Excess Catastrophe Reinsurance

2.000%   of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *SubscribingReinsurer’s* share in the attached Contract shall be separate andapart from the shares of the other reinsurers, and shall not be joint with theshares of the other reinsurers, it being understood that the *Subscribing Reinsurer* shall in no event participate in theinterests and liabilities of the other reinsurers.

**In Witness Whereof,**the *Subscribing Reinsurer* by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

New York, New York, this31 day of January in the year 2006.
|   | /s/ Robert Kuehn                  |
|--------|-----------------------------------|
|   | Vice President                    |
|   | Folksamerica  Reinsurance Company |

 

----

**Interestsand Liabilities Agreement**

of

Hannover Re (Bermuda),Ltd.

Hamilton, Bermuda

*(hereinafterreferred to as the “Subscribing Reinsurer”)*

with respect tothe

**Excess Catastrophe**

**Reinsurance Contract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety Insurance Company

and

Safety IndemnityInsurance Company

both of Boston,Massachusetts

The *SubscribingReinsurer* hereby accepts the following percentage shares in theinterests and liabilities of the “Reinsurer” as set forth in the attachedContract captioned above:

6.500%   of the Third Excess Catastrophe ReinsuranceUX 305 3203 06

7.000%   of the Fourth ExcessCatastrophe Reinsurance UX 305 7204 06

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *SubscribingReinsurer’s* share in the attached Contract shall be separate andapart from the shares of the other reinsurers, and shall not be joint with theshares of the other reinsurers it being understood that the *Subscribing Reinsurer* shall in no event participate in theinterests and liabilities of the other reinsurers.

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

**In Witness Whereof,**the *Subscribing Reinsurer* by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Hamilton, Bermuda, this12th day of January in the year               .
|   | /s/ Illegible                |
|--------|------------------------------|
|   | Hannover Re  (Bermuda), Ltd. |

 

**Hannover re**

Hannover Re(Bermuda), Ltd.

**Hannover re®**

Hannover Re(Bermuda), Ltd.

----

**Interestsand Liabilities Agreement**

of

Montpelier ReinsuranceLimited

Hamilton, Bermuda

*(hereinafterreferred to as the “Subscribing Reinsurer”)*

with respect tothe

**Excess Catastrophe**

**Reinsurance Contract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety Insurance Company

and

Safety IndemnityInsurance Company

both of Boston,Massachusetts

The *SubscribingReinsurer* hereby accepts the following percentage shares in theinterests and liabilities of the “Reinsurer” as set forth in the attachedContract captioned above:

5.000%   of the Third Excess Catastrophe Reinsurance 

5.000%   of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *SubscribingReinsurer’s* share in the attached Contract shall be separate andapart from the shares of the other reinsurers, and shall not be joint with theshares of the other reinsurers, it being understood that the *Subscribing Reinsurer* shall in no event participate in theinterests and liabilities of the other reinsurers.

**In Witness Whereof,**the *Subscribing Reinsurer* by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Hamilton, Bermuda, this13th day of January in the year 2006.
|   | MONTPELIER                      |
|--------|---------------------------------|
|   | Montpelier  Reinsurance Limited |

 

----

**Interestsand Liabilities Agreement**

of

Odyssey AmericaReinsurance Corporation

Stamford, Connecticut

*(hereinafterreferred to as the “Subscribing Reinsurer”)*

with respect tothe

**Excess Catastrophe**

**Reinsurance Contract**

**Effective:January 1, 2006**

issued to and dulyexecuted by

Safety Insurance Company

and

Safety IndemnityInsurance Company 

both of Boston,Massachusetts

The *SubscribingReinsurer* hereby accepts the following percentage shares in theinterests and liabilities of the “Reinsurer” as set forth in the attachedContract captioned above:

3.000%   of the Third Excess Catastrophe Reinsurance

3.000%   of the Fourth ExcessCatastrophe Reinsurance

This Agreement shallbecome effective at 12:01 a.m., Eastern Standard Time, January 1, 2006, andshall continue in force until 12:01 a.m., Eastern Standard Time, January 1,2007, unless earlier terminated in accordance with the provisions of theattached Contract.

The *SubscribingReinsurer’s* share in the attached Contract shall be separate andapart from the shares of the other reinsurers, and shall not be joint with theshares of the other reinsurers, it being understood that the *Subscribing Reinsurer* shall in no event participate in theinterests and liabilities of the other reinsurers.

**In Witness Whereof,**the *Subscribing Reinsurer* by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Stamford, Connecticut,this 24th day of  January in the year2006.
|   | /s/ Illegible                            |
|--------|------------------------------------------|
|   | Odyssey America  Reinsurance Corporation |

 

----

**Interests and LiabilitiesAgreement**

**of**

**Partner Reinsurance CompanyPembroke Parish, Bermuda (*hereinafter referred to as the* “*Subscribing Reinsurer*”)**

**with respect to the**

**Excess CatastropheReinsurance ContractEffective: January 1, 2006**

**issued to and duly executed by**

**Safety Insurance CompanyandSafety Indemnity Insurance Companyboth of Boston, Massachusetts**

The *Subscribing Reinsurer*hereby**accepts the following percentage sharesin the interests and liabilities of the “Reinsurer” as set forth in the attachedContract captioned above:

4.500%           of the Third Excess CatastropheReinsurance

4.500%           ofthe Fourth Excess Catastrophe Reinsurance

This Agreement shall become effective at 12:01 a.m., Eastern StandardTime, January 1, 2006 and shall continue in force until 12:01 a.m., EasternStandard Time, January 1, 2007, unless earlier terminated in accordance withthe provisions of the attached Contract.

The *Subscribing Reinsurer’s*sharein the attached Contract shall be separate and apart from the shares of theother reinsurers, and shall not be joint with the shares of the otherreinsurers, it being understood that the *SubscribingReinsurer*shall**in noevent participate in the interests and liabilities of the other reinsurers.

**In Witness Whereof,** the *Subscribing Reinsurer*by**its duly authorized representative hasexecuted this Agreement as of the date undermentioned at:

Pembroke Parish, Bermuda, this 16th day of January in the year 2006.
|        | /s/ Illegible               |
|--------|-----------------------------|
|   | Partner Reinsurance Company |

 

----

**Interestsand Liabilities Agreement**

of

Platinum UnderwritersReinsurance, Inc.Baltimore, Maryland (*hereinafter referred to as the “SubscribingReinsurer”*)

with respect to the

**ExcessCatastrophe Reinsurance Contract Effective: January 1, 2006**

issued to and dulyexecuted by

Safety Insurance CompanyandSafety Indemnity Insurance Company both of Boston, Massachusetts

The *Subscribing Reinsurer*hereby**accepts the following percentage sharesin the interests and liabilities of the “Reinsurer” as set forth in the attachedContract captioned above:

4.500%           ofthe Third Excess Catastrophe Reinsurance3.500%           of the Fourth ExcessCatastrophe Reinsurance

This Agreement shall become effective at 12:01 a.m., Eastern StandardTime, January 1, 2006, and shall continue in force until 12:01 a.m., EasternStandard Time, January 1, 2007, unless earlier terminated in accordance withthe provisions of the attached Contract.

The *Subscribing Reinsurer’s*sharein the attached Contract shall be separate and apart from the shares of the otherreinsurers, and shall not be joint with the shares of the other reinsurers, itbeing understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**In Witness Whereof**, the *Subscribing Reinsurer*by**its duly authorized representative hasexecuted this Agreement as of the date undermentioned at:

New York, New York, this 11 day of January in the year 2006.
|        | /s/ Illegible                           |
|--------|-----------------------------------------|
|   | Platinum Underwriters Reinsurance, Inc. |

 

----

**Interestsand Liabilities Agreement**

of

Renaissance Reinsurance,Ltd.Hamilton, Bermuda (*hereinafter referred to as the “SubscribingReinsurer”*)

with respect to the

**ExcessCatastrophe Reinsurance Contract Effective: January 1, 2006**

issued to and duly executedby

Safety Insurance CompanyandSafety Indemnity Insurance Company both of Boston, Massachusetts

The *Subscribing Reinsurer*herebyaccepts the following percentage shares in the interests and liabilities of the“Reinsurer” as set forth in the attached Contract captioned above:

3.600%           ofthe Third Excess Catastrophe Reinsurance 3.000%           of the Fourth ExcessCatastrophe Reinsurance

This Agreement shall become effective at 12:01 a.m., Eastern StandardTime, January 1, 2006, and shall continue in force until 12:01 a.m., EasternStandard Time, January 1, 2007, unless earlier terminated in accordance withthe provisions of the attached Contract.

The *Subscribing Reinsurer’s*sharein the attached Contract shall be separate and apart from the shares of theother reinsurers, and shall not be joint with the shares of the otherreinsurers, it being understood that the *SubscribingReinsurer* shall in no event participate in the interests andliabilities of the other reinsurers.

**In Witness Whereof**, the *Subscribing Reinsurer*by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Hamilton, Bermuda, this 12th day of January in the year 2006.
|        | /s/ Illegible                 |
|--------|-------------------------------|
|   | Renaissance Reinsurance, Ltd. |

 

----

**Interestsand Liabilities Agreement**

of

Swiss Reinsurance AmericaCorporation Armonk, New YorkthroughSwiss Re Underwriters Agency, Inc.Calabasas, California(*hereinafter referred to as the “SubscribingReinsurer”*)

with respect to the

**ExcessCatastropheReinsurance ContractEffective: January 1, 2006**

issued to and dulyexecuted by

Safety Insurance CompanyandSafety Indemnity Insurance Companyboth of Boston, Massachusetts

The *Subscribing Reinsurer*herebyaccepts the following percentage shares in the interests and liabilities of the“Reinsurer” as set forth in the attached Contract captioned above:

| 0%     |   | of the Third Excess Catastrophe Reinsurance  |
|--------|--------|----------------------------------------------|
| 5.500% |   | of the Fourth Excess Catastrophe Reinsurance |

 

This Agreement shall become effective at 12:01 a.m., Eastern StandardTime, January 1, 2006, and shall continue in force until 12:01 a.m., EasternStandard Time, January 1, 2007, unless earlier terminated in accordance withthe provisions of the attached Contract.

The *Subscribing Reinsurer’s*sharein the attached Contract shall be separate and apart from the shares of theother reinsurers, and shall not be joint with the shares of the otherreinsurers, it being understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**In Witness Whereof**, the *Subscribing Reinsurer*by its dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Calabasas, California, this 26th day of January in the year 2006.
|        | /s/ Illegible                                                                    |
|--------|----------------------------------------------------------------------------------|
|   | Swiss Re Underwriters Agency, Inc.   (for Swiss Reinsurance America Corporation) |

 

----

**Interestsand Liabilities Agreement**

of

XL Re LtdHamilton, Bermuda(*hereinafter referred to as the “SubscribingReinsurer”)*

with respect to the

**ExcessCatastrophe Reinsurance Contract Effective: January 1, 2006**

issued to and dulyexecuted by

Safety Insurance CompanyandSafety Indemnity Insurance Company both of Boston. Massachusetts

The *Subscribing Reinsurer*herebyaccepts the following percentage shares in the interests and liabilities of the“Reinsurer” as set forth in the attached Contract captioned above:

6.000%           ofthe Third Excess Catastrophe Reinsurance

6.000%           ofthe Fourth Excess Catastrophe Reinsurance

This Agreement shall become effective at 12:01 a.m., Eastern StandardTime, January 1, 2006, and shall continue in force until 12:01 a.m., EasternStandard Time, January 1, 2007, unless earlier terminated in accordance withthe provisions of the attached Contract.

The *Subscribing Reinsurer’s*sharein the attached Contract shall be separate and apart from the shares of theother reinsurers, and shall not be joint with the shares of the otherreinsurers, it being understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

**In****WitnessWhereof,**the *SubscribingReinsurer*by its duly authorized representative has executed thisAgreement as of the date undermentioned at:

Hamilton, Bermuda, this 8th day of February in the year 2006.
|        | /s/ Illegible |
|--------|---------------|
|   | XL Re Ltd.    |

 

----

**Interestsand Liabilities Agreement**

of

Amlin Bermuda LimitedHamilton, Bermuda (*hereinafter referred to as the “SubscribingReinsurer”)*

with respect to the

**ExcessCatastrophe Reinsurance Contract Effective: January 1, 2006**

issued to and dulyexecuted by

Safety Insurance CompanyandSafety Indemnity Insurance Company both of Boston, Massachusetts

The *Subscribing Reinsurer*herebyaccepts the following percentage shares in the interests and liabilities of the“Reinsurer” as set forth in the attached Contract captioned above:

3.348%           of the Third Excess CatastropheReinsurance

3.015%           ofthe Fourth Excess Catastrophe Reinsurance

This Agreement shall become effective at 12:01 a.m., Eastern StandardTime, January 1, 2006, and shall continue in force until 12:01 a.m., EasternStandard Time, January 1, 2007, unless earlier terminated in accordance withthe provisions of the attached Contract.

The *Subscribing Reinsurer’s*sharein the attached Contract shall be separate and apart from the shares of theother reinsurers, and shall not be joint with the shares of the otherreinsurers, it being understood that the *SubscribingReinsurer* shall in no event participate in the interests andliabilities of the other reinsurers.

In Witness Whereof, the *SubscribingReinsurer*by its  dulyauthorized representative has executed this Agreement as of the dateundermentioned at:

Hamilton, Bermuda, this 1st day of February in the year 2006
|        | /s/ Illegible         |
|--------|-----------------------|
|   | Amlin Bermuda Limited |

 

----

**Interestsand Liabilities Agreement**

of

Certain UnderwritingMembers of Lloyd’sshown in the Signing Schedules attached hereto*(hereinafter referred to as the “SubscribingReinsurer”)*

with respect to the

**ExcessCatastrophe Reinsurance Contract Effective: January 1, 2006**

issued to and dulyexecuted by

Safety Insurance CompanyandSafety Indemnity Insurance Company both of Boston, Massachusetts

The *Subscribing Reinsurer*herebyaccepts the following percentage shares in the Interests and liabilities of the“Reinsurer” as set forth in the attached Contract captioned above:

26.952%         ofthe Third Excess Catastrophe Reinsurance

24.885%         ofthe Fourth Excess Catastrophe Reinsurance

The Agreement shall become effective at 12:01 a.m., Eastern StandardTime, January 1, 2006, and shall continue in force until 12:01 a.m., EasternStandard Time, January 1, 2007, unless earlier terminated in accordance withthe provisions of the attached Contract.

The *Subscribing Reinsurer’s*sharein the attached Contract shall be separate and apart from the shares of theother reinsurers, and shall not be joint with the shares of the otherreinsurers, it being understood that the *SubscribingReinsurer*shall in no event participate in the interests andliabilities of the other reinsurers.

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

Signed for and on behalf of the *SubscribingReinsurer*in the Signing Schedules attached hereto.

----

**Signing Schedule**

**attaching to and forming part of the**

**Interests and LiabilitiesAgreement**of

**Certain Underwriting Members of Lloyd’s**

with respect to the

**Excess CatastropheReinsurance ContractEffective: January 1, 2006**

**issued to and duly executed by**

**Safety Insurance Companyas defined in the above captioned Contract**

**Contract Number: B 1108 2006 S3P1123**

**3**rd Excess Limits: USD 30,000,000 excess of USD30,000,000

----

**Signing Schedule**

**attaching to and forming part of the**

**Interests and LiabilitiesAgreement**of

**Certain Underwriting Members of Lloyd’s**

**with respect to the**

**Excess CatastropheReinsurance ContractEffe**ctive: January 1,2006

**issued to and duly executed by**

**Safety Insurance Companyas defined in the above captioned Contract**

**Contract Number: B 1108 2006 S3P1123**

**4**th Excess Limits: USD 190,000,000 excess of USD60,000,000

----

**Excess CatastropheReinsurance ContractEffective: January 1, 2006**

**Issued to**

**Safety Insurance CompanyandSafety Indemnity Insurance Companyboth of Boston, Massachusetts**

----

**Table of Contents**
| Article | ** ** | ** **                      | ** ** | **Page** |
|---------|------------|---------------------------------|------------|----------|
|    |       |                            |       |     |
| I       |       | Classes of Business Reinsured   |       | 1        |
| II      |       | Commencement and Termination    |       | 1        |
| III     |       | Territory (BRMA 51A)            |       | 2        |
| IV      |       | Exclusions                      |       | 2        |
| V       |       | Retention and Limit             |       | 4        |
| VI      |       | Reinstatement                   |       | 4        |
| VII     |       | Definitions                     |       | 5        |
| VIII    |       | Other Reinsurance               |       | 6        |
| IX      |       | Loss Occurrence                 |       | 6        |
| X       |       | Loss Notices and Settlements    |       | 8        |
| XI      |       | Salvage and Subrogation         |       | 9        |
| XII     |       | Reinsurance Premium             |       | 9        |
| XIII    |       | Late Payments                   |       | 10       |
| XIV     |       | Offset (BRMA 36C)               |       | 11       |
| XV      |       | Access to Records (BRMA 1D)     |       | 11       |
| XVI     |       | Net Retained Lines (BRMA 32E)   |       | 11       |
| XVII    |       | Liability of the Reinsurer      |       | 11       |
| XVIII   |       | Errors and Omissions (BRMA 14F) |       | 12       |
| XIX     |       | Currency (BRMA 12A)             |       | 12       |
| XX      |       | Taxes (BRMA 50B)                |       | 12       |
| XXI     |       | Federal Excise Tax              |       | 12       |
| XXII    |       | Unauthorized Reinsurers         |       | 12       |
| XXIII   |       | Insolvency                      |       | 14       |
| XXIV    |       | Arbitration                     |       | 14       |
| XXV     |       | Service of Suit (BRMA 49C)      |       | 15       |
| XXVI    |       | Governing Law                   |       | 16       |
| XXVII   |       | Agency Agreement                |       | 16       |
| XXVIII  |       | Severability (BRMA 72E)         |       | 16       |
| XXIX    |       | Intermediary (BRMA 23A)         |       | 16       |
|    |       | Schedule A                      |       |     |

 

----

**ExcessCatastropheReinsurance ContractEffective: January 1, 2006**

issued to

Safety Insurance CompanyandSafety Indemnity Insurance Companyboth of Boston, Massachusetts*(hereinafter referred to collectively as the*“Company”)

by

The SubscribingReinsurer(s) Executing theInterests and Liabilities Agreement(s)Attached Hereto*(hereinafter referred to as the*“Reinsurer”)

**Article I - Classes of Business Reinsured**

By this Contract the Reinsurer agrees to reinsure the excess liabilitywhich may accrue to the Company under its policies, contracts and binders ofinsurance or reinsurance (hereinafter called “policies”) in force on theeffective date hereof or issued or renewed on or after that date, andclassified by the Company as Fire, Allied Lines, Homeowners Multiple Peril(Section I only), Commercial Multiple Peril (Section I only), Inland Marine andAutomobile Physical Damage (not to include Collision coverage) business,subject to the terms, conditions and limitations set forth herein and inSchedule A attached to and forming part of this Contract.

**Article II - Commencement and Termination**

A.       This Contractshall become effective at 12.01 a.m., Eastern Standard Time, January 1, 2006,with respect to losses arising out of loss occurrences commencing at or after thattime and date, and shall remain in force until 12:01 a.m., Eastern StandardTime, January 1, 2007.

B.        Notwithstandingthe provisions of paragraph A above, the Company may terminate a SubscribingReinsurer’s percentage share in this Contract at any time by giving writtennotice to the Subscribing Reinsurer in the event any of the followingcircumstances occur:

1.        TheSubscribing Reinsurer’s policyholders’ surplus at the inception of thisContract has been reduced by more than 20.0% of the amount of surplus 12 monthsprior to that date; or

1

----

2.        TheSubscribing Reinsurer’s policyholders’ surplus at any time during the term ofthis Contract has been reduced by more than 20.0% of the amount of surplus atthe date of the Subscribing Reinsurer’s most recent financial statement filedwith regulatory authorities and available to the public as of the inception ofthis Contract; or

3.        TheSubscribing Reinsurer’s A.M. Best’s rating has been assigned or downgradedbelow A- and/or Standard & Poor’s rating has been assigned or downgradedbelow BBB+; or

4.        TheSubscribing Reinsurer has become merged with, acquired by or controlled by anyother company, corporation or individual(s) not controlling the SubscribingReinsurer’s operations previously; or

5.        AState Insurance Department or other legal authority has ordered the SubscribingReinsurer to cease writing business; or

6.        TheSubscribing Reinsurer has become insolvent or has been placed into liquidationor receivership (whether voluntary or involuntary) or proceedings have beeninstituted against the Subscribing Reinsurer for the appointment of a receiver,liquidator, rehabilitator, conservator or trustee in bankruptcy, or other agentknown by whatever name, to take possession of its assets or control of itsoperations; or

7.        TheSubscribing Reinsurer has reinsured its entire liability under this Contractwithout the Company’s prior written consent; or

8.        TheSubscribing Reinsurer has ceased assuming new and renewal property treatyreinsurance business.

C.        If thisContract is terminated or expires while a loss occurrence covered hereunder isin progress, the Reinsurer’s liability hereunder shall, subject to the otherterms and conditions of this Contract, be determined as if the entire lossoccurrence had occurred prior to the termination or expiration of thisContract, provided that no part of such loss occurrence is claimed against anyrenewal or replacement of this Contract.

**Article III - Territory (BRMA 51A)**

The territorial limits of this Contract shall be identical with thoseof the Company’s policies.

**Article IV - Exclusions**

This Contract does not apply to and specifically excludes the following

1.        Lossor damage occasioned by war, invasion, hostilities, acts of foreign enemies,civil war, rebellion, insurrection, military or usurped power, martial law orconfiscation by order of any government or public authority, but not excludingloss or damage which would be covered under a standard form of policycontaining a standard war exclusion clause.

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2.        Nuclearrisks as defined in the “Nuclear Incident Exclusion Clause - Physical Damage -Reinsurance” attached to and forming part of this Contract.

3.        Liabilityas a member, subscriber or reinsurer of any Pool, Syndicate or Association; andany combination of insurers or reinsurers formed for the purpose of**covering specific perils, specificclasses of business or for the purpose of insuring risks located in specificgeographical areas; but this exclusion shall not apply to FAIR Plans or to SIRPool, Franklin Pool, Coastal Pools, Beach Plans or similar plans, howeverstyled. It is understood and agreed, however, that this reinsurance does notinclude any increase in liability to the Company resulting from (a) theinability of any other participant in a FAIR Plan, SIR Pool, Franklin Pool,Coastal Pool, Beach Plan or similar plan to meet its liability, or (b) anyclaim against such a FAIR Plan, SIR Pool, Franklin Pool, Coastal Pool, BeachPlan or similar plan, or any participant therein, including the Company,whether by way of subrogation or otherwise, brought by or on behalf of anyinsolvency fund.

4.        Financialguarantee and insolvency.

5.        Thirdparty liability.

6.        Allclasses of business not specifically listed in the Classes of BusinessReinsured Article.

7.        Reinsuranceassumed, except pro rata local agency reinsurance on specific risks.

8.        Ex-gratiapayments.

9.        Risksexcluded under the provisions of the “Total Insured Value Clause” attached toand forming part of this Contract.

10.      Allliability of the Company arising by contract, operation of law, or otherwise,from its participation or membership, whether voluntary or involuntary, in anyinsolvency 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 orassumption by the Company of**partor all of any claim, debt, charge, fee or other obligation of an insurer, orits successors or assigns, which has been declared by any competent authorityto be insolvent, or which is otherwise deemed unable to meet any claim, debt,charge, fee or other obligation in whole or in part.

11.      Lossor liability excluded under the “Terrorism Exclusion Clause” attached to andforming part of this Contract.

12.      Lossand/or damage and/or costs and/or expenses arising from Seepage and/orPollution and/or Contamination, other than contamination from Smoke Damage.Nevertheless, this exclusion does not preclude any payment of the cost of theremoval of debris of property damaged by a loss otherwise covered hereunder,but subject always to a limit of 25.0% of the Company’s property loss under theoriginal policy.

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**Article V - Retention and Limit**

A.       As respectseach excess layer of reinsurance coverage provided by this Contract, theCompany 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 attachedhereto, arising out of each loss occurrence. The Reinsurer shall then be liable,as respects each excess layer, for the percentage, shown as “Reinsurer’sPercentage” for that excess layer, of the amount by which such ultimate netloss exceeds the Company’s applicable retention, but the liability of theReinsurer under each excess layer shall not exceed the percentage, shown as “Reinsurer’sPercentage” for that excess layer, of the amount, shown as “Reinsurer’s PerOccurrence Limit” for that excess layer in Schedule A attached hereto, asrespects any one loss occurrence.

B.        No claimshall be made under any excess layer of coverage provided by this Contract inany one loss occurrence unless at least two risks insured or reinsured by theCompany are involved in such loss occurrence. For purposes hereof, the Companyshall be the sole judge of what constitutes “one risk.”

C.        As respectseach excess layer of reinsurance coverage provided by this Contract, theCompany shall retain, net and unreinsured elsewhere, in addition to its initialretention each loss occurrence, the percentage shown as “Company’sCoreinsurance” for that excess layer in Schedule A attached hereto, as respectsany one loss occurrence.

**Article VI - Reinstatement**

A.       In the eventall or any portion of the reinsurance under any excess layer of reinsurancecoverage provided by this Contract is exhausted by loss, the amount soexhausted shall be reinstated immediately from the time the loss occurrencecommences hereon. For each amount so reinstated the Company agrees to payadditional premium equal to the product of the following:

1.        Thepercentage of the occurrence limit for the excess layer reinstated (based onthe loss paid by the Reinsurer under that excess layer); times

2.        Theearned reinsurance premium for the excess layer reinstated for the term of thisContract (exclusive of reinstatement premium).

B.        Whenever theCompany requests payment by the Reinsurer of any loss under any excess layerhereunder, the Company shall submit a statement to the Reinsurer ofreinstatement premium due the Reinsurer for that excess layer. If the earnedreinsurance premium for any excess layer for the term of this Contract has notbeen finally determined as of the date of any such statement, the calculationof reinstatement premium due for that excess layer shall be based on the annualdeposit premium for that excess layer and shall be readjusted when the earnedreinsurance premium for that excess layer for the term of this Contract hasbeen finally determined. Any reinstatement premium shown to be due theReinsurer for any excess layer as reflected by any such statement (less priorpayments, if any, for that excess layer) shall be payable by the Companyconcurrently with payment by the Reinsurer of the requested loss for thatexcess layer. Any return reinstatement premium shown to be due the Companyshall be remitted by the Reinsurer as promptly as possible after receipt andverification of the Company’s statement.

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C.        Notwithstandinganything stated herein, the liability of the Reinsurer under any excess layerof reinsurance coverage provided by this Contract shall not exceed either ofthe following:

1.        Thepercentage, shown as “Reinsurer’s Percentage for that excess layer, of theamount, shown as “Reinsurer’s Per Occurrence Limit” for that excess layer inSchedule A attached hereto, as respects loss or losses arising out of any oneloss occurrence; or

2.        Thepercentage, shown as “Reinsurer’s Percentage” for that excess layer, of theamount, shown as “Reinsurer’s Annual Limit” for that excess layer in Schedule Aattached hereto, in all during the term of this Contract.

**Article VII - Definitions**

A.       “Ultimate netloss” as used herein is defined as the sum or sums (including loss in excess ofpolicy limits, extra contractual obligations and loss adjustment expense, ashereinafter defined) paid or payable by the Company in settlement of claims andin satisfaction of judgments rendered on account of such claims, afterdeduction of all salvage, all recoveries and all claims on inuring insurance orreinsurance, whether collectible or not. Nothing herein shall be construed tomean that losses under this Contract are not recoverable until the Company’sultimate net loss has been ascertained.

B.        “Loss inexcess of policy limits” and “extra contractual obligations” as used hereinshall be defined as follows:

1.        “Lossin excess of policy limits” shall mean 80.0% of any amount paid or payable bythe Company in excess of its policy limits, but otherwise within the terms ofits policy, such loss in excess of the Company’s policy limits having beenincurred because of, but not limited to, failure by the Company to settlewithin the policy limits or by reason of the Company’s alleged or actualnegligence, fraud or bad faith in rejecting an offer of settlement or in thepreparation of the defense or in the trial of an action against its insured orreinsured or in the preparation or prosecution of an appeal consequent uponsuch an action.

2.        “Extracontractual obligations” shall mean 80.0% of any punitive, exemplary,compensatory or consequential damages paid or payable by the Company, notcovered by any other provision of this Contract and which arise from thehandling of any claim on business subject to this Contract, such liabilitiesarising because of, but not limited to, failure by the Company to settle withinthe policy limits or by reason of the Company’s alleged or actual negligence,fraud or bad faith in rejecting an offer of settlement or in the preparation ofthe defense or in the trial of an action against its insured or reinsured or inthe preparation or prosecution of an appeal consequent upon such an action. Anextra contractual obligation shall be deemed, in all circumstances, to haveoccurred on the same date as the loss covered or alleged to be covered underthe policy.

The amount included in ultimate net loss for any oneloss occurrence as respects loss in excess of policy limits and extracontractual obligations shall not exceed 25.0% of the Company’s indemnity losshereunder arising out of that loss occurrence.

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Notwithstanding anything stated herein, this Contractshall not apply to any loss in excess of policy limits or any extra contractualobligation incurred by the Company as a result of any fraudulent and/orcriminal act by any officer or director of the Company acting individually orcollectively or in collusion with any individual or corporation or any otherorganization or party involved in the presentation, defense or settlement ofany claim covered hereunder.

Savings Clause (Applicable only if the SubscribingReinsurer is domiciled in**the Stateof New York): In no event shall coverage be provided to the extent that suchcoverage is not permitted under New York law.

C.        “Lossadjustment expense” as used herein shall mean expenses assignable to theinvestigation, appraisal, adjustment, settlement, litigation, defense and/orappeal of specific claims, regardless of how such expenses are classified forstatutory purposes. Loss adjustment expense shall include, but not be limitedto, interest on judgments, expenses of outside adjusters, and declaratoryjudgment expenses or other legal expenses and costs incurred in connection withcoverage questions and legal actions connected thereto, but shall not includeoffice expenses or salaries of the Company’s regular employees not classifiedas loss adjusters.

**Article VIII - OtherReinsurance**

A.       The Companyshall maintain in force property per risk excess of loss reinsurance,recoveries under which shall inure to the benefit of this Contract.

B.        The Companyshall be permitted to carry underlying property catastrophe excess of lossreinsurance, recoveries under which shall inure solely to the benefit of theCompany and be entirely disregarded in applying all of the provisions of thisContract.

**Article IX - LossOccurrence**

A.       The term “lossoccurrence” shall mean the sum of all individual losses directly occasioned byany one disaster, accident or loss or series of disasters, accidents or lossesarising out of one event which occurs within the area of one state of theUnited States or province of Canada and states or provinces contiguous theretoand to one another. However, the duration and extent of any one “lossoccurrence” shall be limited to all individual losses sustained by the Companyoccurring during any period of 168 consecutive hours arising out of and directlyoccasioned by the same event, except that the term “loss occurrence” shall befurther defined as follows:

1.        Asregards windstorm, hail, tornado, hurricane, cyclone, including ensuingcollapse and water damage, all individual losses sustained by the Companyoccurring during any period of 72 consecutive hours arising out of and directlyoccasioned by the same event. However, the event need not be limited to onestate or province or states or provinces contiguous thereto.

2.        Asregards riot, riot attending a strike, civil commotion, vandalism and maliciousmischief, all individual losses sustained by the Company occurring during anyperiod

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of 72 consecutive hours within the area of onemunicipality or county and the municipalities or counties contiguous theretoarising out of and directly occasioned by the same event. The maximum durationof 72 consecutive hours may be extended in respect of individual losses whichoccur beyond such 72 consecutive hours during the continued occupation of anassured’s premises by strikers, provided such occupation commenced during theaforesaid period.

3.        Asregards earthquake (the epicentre of which need not necessarily be within theterritorial confines referred to in paragraph A of this Article) and firefollowing directly occasioned by the earthquake, only those individual fire losseswhich commence during the period of 168 consecutive hours may be included inthe Company’s “loss occurrence.”

4.        Asregards “freeze,” only individual losses directly occasioned by collapse,breakage of glass and water damage (including, but not limited to, those causedby bursting frozen pipes and tanks) may be included in the Company’s “lossoccurrence.”

5.        Asregards firestorms, brush fires and any other fires or series of fires, irrespectiveof origin (except as provided in subparagraphs 2 and 3 above), which spreadthrough trees, grassland or other vegetation, all individual losses sustainedby the Company which occur during any period of 168 consecutive hours within150-mile radius of any one fixed point selected by the Company may be includedin the Company’s “loss occurrence.” However, an individual loss subject to thissubparagraph cannot be included in more than one “loss occurrence.”

B.        Except forthose “loss occurrences,” referred to in subparagraphs 1 and 2 of paragraph Aabove, the Company may choose the date and time when any such period ofconsecutive hours commences, provided that it is not earlier than the date andtime of the occurrence of the first recorded individual loss sustained by theCompany arising out of that disaster, accident or loss, and provided that onlyone such period of 168 consecutive hours shall apply with respect to one event.

C.        As respectsthose “loss occurrences” referred to in subparagraphs 1 and 2 of paragraph Aabove, if the disaster, accident or loss occasioned by the event is of greaterduration than 72 consecutive hours, then the Company may divide that disaster,accident or loss into two or more “loss occurrences,” provided no two periodsoverlap and no individual loss is included in more than one such period andprovided that no period commences earlier than the date and time of theoccurrence of the first recorded individual loss sustained by the Companyarising out of that disaster, accident or loss.

D.        Noindividual losses occasioned by an event that would be covered by 72 hoursclauses may be included in any “loss occurrence” claimed under the 168 hoursprovision.

E.        Any datechange, including leap-year calculations, shall not in and of itself beregarded as an event for purposes of this Contract.

This includes any loss, damage, cost, claim orexpense, whether preventative, remedial or otherwise, directly or indirectlyarising out of or relating to:

a.         Thecalculation, comparison, differentiation, sequencing or processing of datainvolving a date change, including leap-year calculations, by any computer

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system, hardware, program or software and/or anymicrochip, integrated circuit or similar device in computer equipment ornon-computer equipment, whether the property of the insured or not; or

b.        Anychange, alteration or modification involving a data change, including leap-yearcalculations, to any such computer system, hardware, program or software or anymicrochip, integrated circuit or similar device in computer equipment ornon-computer equipment, whether the property of the insured or not.

This subparagraph shall apply regardless of any othercause or event that contributes concurrently or in any sequence to the loss,damage, cost, claim or expense.

However, this subparagraph shall not apply as respectsphysical damage occurring at the insured’s premises arising out of the perilscovered under this Contract.

2.        Notwithstandingsubparagraph 1 above, this Contract shall not cover any costs and expenses,whether preventative, remedial or otherwise, arising out of or relating tochange, alteration or modification of any computer system, hardware, program orsoftware or any microchip, integrated circuit or similar device in computer ornon-computer equipment, whether the property of the insured or not.

F.        Lossesarising, directly or indirectly, out of:

1.         Loss of,alteration of, or damage to:

or

2.         A reduction in thefunctionality availability or operation of

A computer system, hardware, program, software, data,information repository, microchip, integrated circuit or similar device incomputer equipment or non-computer equipment, whether the property of thepolicyholder of the Company or not, do not in and of themselves constitute anevent unless arising out of one or more of the following perils:

Fire, lightning, explosion, aircraft or vehicleimpact, falling objects, windstorm, hail, tornado, cyclone, hurricane,earthquake, volcano, tsunami, flood, freeze or weight of snow.

**Article X - Loss Noticesand Settlements**

A.       Wheneverlosses sustained by the Company appear likely to result in a claim hereunder,the Company shall notify the Reinsurer, and the Reinsurer shall have the rightto participate in the adjustment of such losses at its own expense.

B.        All losssettlements made by the Company, provided they are within the terms of thisContract, shall be binding upon the Reinsurer, and the Reinsurer agrees to payall amounts for which it may be liable upon receipt of reasonable evidence ofthe amount paid (or scheduled to be paid, but no more than 10 days in advanceof the date of payment of claims) by the Company.

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**Article XI - Salvage and Subrogation**

The Reinsurer shall be credited with salvage (i.e., reimbursementobtained or recovery made by the Company, less the actual cost, excludingsalaries of officials and employees of the Company and sums paid to attorneysas retainer, of obtaining such reimbursement or making such recovery) onaccount of claims and settlements involving reinsurance hereunder. Salvagethereon shall always be used to reimburse the excess carriers in the reverseorder of their priority according to their participation before being used inany way to reimburse the Company for its primary loss. The Company herebyagrees to enforce its rights to salvage or subrogation relating to any loss, apart of which loss was sustained by the Reinsurer, and to prosecute all claimsarising out of such rights.

**Article XII - Reinsurance Premium**

A.       As premiumfor each excess layer of reinsurance coverage provided by this Contract, theCompany shall pay the Reinsurer the greater of the following:

1         Theamount, shown as “Minimum Premium” for that excess layer in Schedule A attachedhereto (or a pro rata portion of the Subscribing Reinsurer’s share, in theevent that such Subscribing Reinsurer’s share under any excess layer isterminated prior to January 1, 2007); or

2         Thepercentage, shown as “Premium Rate” for that excess layer in Schedule Aattached hereto, of the Company’s net earned premium for the term of thisContract.

B.        The Companyshall pay the Reinsurer an deposit premium for each excess layer of the amount,shown as “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 2006. In the event that a Subscribing Reinsurer’s shareunder any excess layer hereof is terminated prior to January 1, 2007, noquarterly deposit installments for such layer(s) shall be due to suchSubscribing Reinsurer after the effective date of termination.

C.        Within 60days after the termination or expiration of this Contract, the Company shallprovide a report to the Reinsurer setting forth the premium due hereunder foreach excess layer, computed in accordance with paragraph A, and any additionalpremium due the Reinsurer or return premium due the Company for each suchexcess layer shall be remitted promptly.

D.        “Net earnedpremium” as used herein is defined as gross earned premium of the Company forthe classes of business reinsured hereunder, less the earned portion ofpremiums ceded by the Company for reinsurance which inures to the benefit ofthis Contract. For purposes of calculating net earned premium, 90.0% ofHomeowners Multiple Peril and 80.0% of Commercial Multiple Peril total basicpolicy premium on indivisible premium policies shall be considered subjectpremium.

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**Article XIII - Late Payments**

A.       Theprovisions of this Article shall not be implemented unless specificallyinvoked, in writing, by one of the parties to this Contract.

B.        In the eventany premium, loss or other payment due either party is not received by theintermediary named in the Intermediary Article (BRMA 23A) (hereinafter referredto as the “Intermediary”) by the payment due date, the party to whom payment isdue may, by notifying the Intermediary in writing, require the debtor party topay, and the debtor party agrees to pay, an interest penalty on the amount pastdue calculated for each such payment on the last business day of each month asfollows:

1.        Thenumber of full days which have expired since the due date or the last monthlycalculation, whichever the lesser; times

2.        1/365thsof the six-month United States Treasury Bill rate as quoted in The Wall StreetJournal on the first business day of the month for which the calculation ismade; times

3.        Theamount past due, including accrued interest.

It is agreed that interest shall accumulate until payment of theoriginal amount due plus interest penalties have been received by theIntermediary.

C.        Theestablishment of the due date shall, for purposes of this Article, bedetermined as follows:

As respects the payment of routine deposits andpremiums due the Reinsurer, the due date shall be as provided for in theapplicable section of this Contract. In the event a due date is notspecifically stated for a given payment, it shall be deemed due 30 businessdays after the date of transmittal by the Intermediary of the initial billingfor each such payment.

2.        Anyclaim or loss payment due the Company hereunder shall be deemed due 30 businessdays after the proof of loss or demand for payment is transmitted to theReinsurer. If such loss or claim payment is not received within the 30 businessdays, interest will accrue on the payment or amount overdue in accordance withparagraph B above, from the date the proof of loss or demand for payment wastransmitted to the Reinsurer.

3.        Asrespects any payment, adjustment or return due either party not otherwiseprovided for in subparagraphs 1 and 2 of this paragraph, the due date shall beas provided for in the applicable section of this Contract. In the event a duedate is not specifically stated for a given payment, it shall be deemed due 30business days following transmittal of written notification that the provisionsof this Article have been invoked.

For purposes of interest calculations only, amounts due hereunder shallbe deemed paid upon receipt by the Intermediary.

D.        Nothingherein shall be construed as limiting or prohibiting a Subscribing Reinsurerfrom contesting the validity of any claim, or from participating in the defenseof any claim or suit,

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or prohibiting either party from contesting the validity of any paymentor from initiating any arbitration or other proceeding in accordance with theprovisions of this Contract. If the debtor party prevails in an arbitration orother proceeding, then any interest penalties due hereunder on the amount indispute 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 becalculated in accordance with the provisions set forth above unless otherwisedetermined by such proceedings. If a debtor party advances payment of anyamount it is contesting, and proves to be correct in its contestation, eitherin whole or in part, the other party shall reimburse the debtor party for anysuch excess payment made plus interest on the excess amount calculated inaccordance with this Article.

E.        Interestpenalties arising out of the application of this Article that are $100 or lessfrom any party shall be waived unless there is a pattern of late paymentsconsisting of three or more items over the course of any 12-month period.

**Article XIV - Offset (BRMA 36C)**

The Company and the Reinsurer shall have the right to offset anybalance or amounts due from one party to the other under the terms of thisContract. The party asserting the right of offset may exercise such right anytime whether the balances due are on account of premiums or losses orotherwise.

**Article XV - Access to Records (BRMA 1D)**

The Reinsurer or its designated representatives shall have access atany reasonable time to all records of the Company which pertain in any way tothis reinsurance.

**Article XVI - Net Retained Lines (BRMA 32E)**

A.       This Contractapplies only to that portion of any policy which the Company retains net forits own account (prior to deduction of any underlying reinsurance specificallypermitted in this Contract), and in calculating the amount of any losshereunder and also in computing the amount or amounts in excess of which thisContract attaches, only loss or losses in respect of that portion of any policywhich the Company retains net for its own account shall be included.

B.        The amountof the Reinsurer’s liability hereunder in respect of any loss or losses shallnot be increased by reason of the inability of the Company to collect from anyother reinsurer(s), whether specific or general, any amounts which may havebecome due from such reinsurer(s), whether such inability arises from theinsolvency of such other reinsurer(s) or otherwise.

**Article XVII - Liability of the Reinsurer**

A.       The liabilityof the Reinsurer shall follow that of the Company in every case and be subjectin all respects to all the general and specific stipulations, clauses, waiversand modifications of the Company’s policies and any endorsements thereon.However, in no event shall this

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be construed in any way to provide coverage outside the terms andconditions set forth in this Contract.

B.        Nothingherein shall in any manner create any obligations or establish any rightsagainst the Reinsurer in favor of any third party or any persons not parties tothis Contract.

**Article XVIII - Errorsand Omissions (BRMA 14F)**

Inadvertent delays, errors or omissions made in connection with thisContract or any transaction hereunder shall not relieve either party from anyliability which would have attached had such delay, error or omission notoccurred, provided always that such error or omission is rectified as soon aspossible after discovery.

**Article XIX - Currency(BRMA 12A)**

A.       Whenever theword “Dollars” or the “$” sign appears in this Contract, they shall beconstrued to mean United States Dollars and all transactions under thisContract shall be in United States Dollars.

B.        Amounts paidor received by the Company in any other currency shall be converted to UnitedStates Dollars at the rate of exchange at the date such transaction is enteredon the books of the Company.

**Article XX - Taxes (BRMA50B)**

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

**Article XXI - FederalExcise Tax**

A.       The Reinsurerhas agreed to allow for the purpose of paying the Federal Excise Tax theapplicable percentage of the premium payable hereon (as imposed under Section4371 of the Internal Revenue Code) to the extent such premium is subject to theFederal Excise Tax.

B.        In the eventof any return of premium becoming due hereunder the Reinsurer will deduct theapplicable percentage from the return premium payable hereon and the Company orits agent should take steps to recover the tax from the United StatesGovernment.

**Article XXII -Unauthorized Reinsurers**

A.       If theReinsurer is unauthorized in any state of the United States of America or theDistrict of Columbia, the Reinsurer agrees to fund its share of the Company’sceded United States

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outstanding loss and loss adjustment expense reserves (including allcase reserves plus any reasonable amount estimated to be unreported from knownloss occurrences) by:

Clean, irrevocable and unconditional letters of creditissued and confirmed. If confirmation is required by the insurance regulatoryauthorities involved, by a bank or banks meeting the NAIC Securities ValuationOffice credit standards for issuers of letters of credit and acceptable to saidinsurance regulatory authorities: and/or

2.        Escrowaccounts for the benefit of the Company; and/or

3.        Cashadvances;

If, without such funding, a penalty would accrue to the Company on anyfinancial statement it is required to file with the insurance regulatoryauthorities involved. The Reinsurer, at its sole option, may fund in other thancash if its method and form of funding are acceptable to the insuranceregulatory authorities involved.

B.        With regardto funding in whole or in part by letters of credit, it is agreed that eachletter of credit will be in a form acceptable to insurance regulatoryauthorities involved, will be issued for a term of at least one year and willinclude an “evergreen clause,” which automatically extends the term for atleast one additional year at each expiration date unless written notice ofnon-renewal is given to the Company not less than 30 days prior to saidexpiration date. The Company and the Reinsurer further agree, notwithstandinganything to the contrary in this Contract, that said letters of credit may bedrawn upon by the Company or its successors in interest at any time, withoutdiminution because of the insolvency of the Company or the Reinsurer, but onlyfor one or more of the following purposes:

1.        Toreimburse itself for the Reinsurer’s share of losses and/or loss adjustmentexpense paid under the terms of policies reinsured hereunder, unless paid incash by the Reinsurer;

2.        Toreimburse itself for the Reinsurer’s share of any other amounts claimed to bedue hereunder, unless paid in cash by the Reinsurer;

3.        Tofund a cash account in an amount equal to the Reinsurer’s share of any cededoutstanding loss and loss adjustment expense reserves (including all casereserves plus any reasonable amount estimated to be unreported from known lossoccurrences) funded by means of a letter of credit which is under non-renewalnotice, if said letter of credit has not been renewed or replaced by theReinsurer 10 days prior to its expiration date;

4.        Torefund to the Reinsurer any sum in excess of the actual amount required to fundthe Reinsurer’s share of the Company’s ceded outstanding loss and lossadjustment expense reserves (including all case reserves plus any reasonableamount estimated to be unreported from known loss occurrences), if so requestedby the Reinsurer.

In the event the amount drawn by the Company on any letter of credit isin excess of the actual amount required for B(1) or B(3), or in the case ofB(2), the actual amount determined to be due, the Company shall promptly returnto the Reinsurer the excess amount so drawn.

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**Article XXIII -Insolvency**

A.       In the eventof the insolvency of one or both of the reinsured companies, this reinsuranceshall be payable directly to the company or to its liquidator, receiver,conservator or statutory successor on the basis of the liability of the companywithout diminution because of the insolvency of the company or because theliquidator, receiver, conservator or statutory successor of the company hasfailed to pay all or a portion of any claim. It is agreed, however, that theliquidator, receiver, conservator or statutory successor of the company shallgive written notice to the Reinsurer of the pendency of a claim against thecompany indicating the policy or bond reinsured which claim would involve apossible liability on the part of the Reinsurer within a reasonable time aftersuch claim is filed in the conservation or liquidation proceeding or in thereceivership, and that during the pendency of such claim, the Reinsurer mayinvestigate such claim and interpose, at its own expense, in the proceedingwhere such claim is to be adjudicated, any defense or defenses that it may deemavailable to the company or its liquidator, receiver, conservator or statutorysuccessor. The expense thus incurred by the Reinsurer shall be chargeable,subject to the approval of the Court, against the company as part of theexpense of conservation or liquidation to the extent of a pro rata share of thebenefit which may accrue to the company solely as a result of the defenseundertaken by the Reinsurer.

B.        Where two ormore reinsurers are involved in the same claim and a majority in interest electto interpose defense to such claim, the expense shall be apportioned inaccordance with the terms of this Contract as though such expense had beenincurred by the company.

C.        It isfurther understood and agreed that, in the event of the insolvency of one orboth of the reinsured companies, the reinsurance under this Contract shall bepayable directly by the Reinsurer to the company or to its liquidator, receiveror statutory successor, except as provided by Section 4118(a) of the New YorkInsurance Law or except (1) where this Contract specifically provides anotherpayee 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 hasassumed such policy obligations of the company as direct obligations of theReinsurer to the payees under such policies and in substitution for theobligations of the company to such payees.

**Article XXIV - Arbitration**

A.       As acondition precedent to any right of action hereunder, in the event of anydispute or difference of opinion hereafter arising with respect to thisContract, it is hereby mutually agreed that such dispute or difference ofopinion shall be submitted to arbitration. One Arbiter shall be chosen by theCompany, the other by the Reinsurer, and an Umpire shall be chosen by the twoArbiters before they enter upon arbitration, all of whom shall be active orretired disinterested executive officers of insurance or reinsurance companiesor Lloyd’s London Underwriters. In the event that either party should fail tochoose an Arbiter within 30 days following a written request by the other partyto do so, the requesting party may choose two Arbiters who shall in turn choosean Umpire before entering upon arbitration. If the two Arbiters fail to agreeupon the selection of an Umpire within 30 days following their appointment, thetwo Arbiters shall request the American Arbitration Association to appoint theUmpire. If the American Arbitration Association fails to appoint the Umpirewithin

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30 days after it has been requested to do so, either party may requesta justice of a Court of general jurisdiction of the state in which thearbitration is to be held to appoint the Umpire.

B.        Each partyshall present its case to the Arbiters within 30 days following the date of appointmentof the Umpire. The Arbiters shall consider this Contract as an honorableengagement rather than merely as a legal obligation and they are relieved ofall judicial formalities and may abstain from following the strict rules oflaw. 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 themajority shall be final and binding upon both parties. Judgment upon the finaldecision of the Arbiters may be entered in any court of competent jurisdiction.

C.        If more thanone reinsurer is involved in the same dispute, all such reinsurers shallconstitute and act as one party for purposes of this Article and communicationsshall be made by the Company to each of the reinsurers constituting one party,provided, however, that nothing herein shall impair the rights of suchreinsurers to assert several, rather than joint, defenses or claims, nor beconstrued as changing the liability of the reinsurers participating under the termsof this Contract from several to joint.

D.        Each partyshall bear the expense of its own Arbiter, and shall jointly and equally bearwith the other the expense of the Umpire and of the arbitration. In the eventthat the two Arbiters are chosen by one party, as above provided, the expenseof the Arbiters, the Umpire and the arbitration shall be equally dividedbetween the two parties.

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

**Article XXV - Service of Suit (BRMA 49C)**

(Applicable if the Reinsurer is not domiciled in the United States ofAmerica, and/or is not authorized in any State, Territory or District of theUnited States where authorization is required by insurance regulatoryauthorities)

A.       It is agreedthat in the event the Reinsurer fails to pay any amount claimed to be duehereunder, the Reinsurer, at the request of the Company, will submit to thejurisdiction of a court of competent jurisdiction within the United States.Nothing in this Article constitutes or should be understood to constitute awaiver of the Reinsurer’s rights to commence an action in any court ofcompetent jurisdiction in the United States, to remove an action to a UnitedStates District Court, or to seek a transfer of a case to another court aspermitted 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 UnitedStates which makes provision therefor, the Reinsurer hereby designates theparty named in its Interests and Liabilities Agreement, or if no party is namedtherein, the Superintendent, Commissioner or Director of Insurance or otherofficer specified for that purpose in the statute, or his successor orsuccessors in office, as its true and lawful attorney upon whom may be servedany lawful process in any action, suit or proceeding instituted by or on behalfof the Company or any beneficiary hereunder arising out of this Contract.

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**Article XXVI - Governing Law**

This Contract shall be governed by and construed in accordance with thelaw of the Commonwealth of Massachusetts.

**Article XXVII - Agency Agreement**

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

**Article XXVIII - Severability (BRMA 72E)**

If any provision of this Contract shall be rendered illegal orunenforceable by the laws, regulations or public policy of any state, suchprovision shall be considered void in such state, but this shall not affect thevalidity or enforceability of any other provision of this Contract or theenforceability of such provision in any other jurisdiction.

**Article XXIX - Intermediary (BRMA 23A)**

Benfield Inc. is hereby recognized as the Intermediary negotiating thisContract for all business hereunder. All communications (including but notlimited to notices, statements, premium, return premium, commissions, taxes,losses, loss adjustment expense, salvages and loss settlements) relatingthereto shall be transmitted to the Company or the Reinsurer through BenfieldInc. Payments by the Company to the Intermediary shall be deemed to constitutepayment to the Reinsurer. Payments by the Reinsurer to the Intermediary shallbe deemed to constitute payment to the Company only to the extent that suchpayments are actually received by the Company.

**In Witness Whereof**, the Company byits duly authorized representative has executed this Contract as of the dateundermentioned at:

Boston, Massachusetts,  this 9th day of Jan. in the year 2006.
|        | /s/ Illegible                      |
|--------|------------------------------------|
|   | Safety Insurance Company           |
|   | Safety Indemnity Insurance Company |

 

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**Schedule A**

**Excess Catastrophe Reinsurance Contract**Effective: January 1, 2006

**issued to**

Safety InsuranceCompanyandSafety Indemnity Insurance Company both of Boston, Massachusetts
| ** **                             | ** ** | **Third  Excess** | ** ** | **Fourth  Excess** | ** ** |
|----------------------------------------|------------|-------------------|------------|--------------------|------------|
|                                   |       |              |       |               |       |
| Company’s  Coreinsurance          |       | 10.0              | %          | 10.0               | %          |
| Reinsurer’s  Percentage           |       | 90.0              | %          | 90.0               | %          |
| Company’s  Retention              |       | $                 | 30,000,000 |               | $          | 60,000,000 |   |
| Reinsurer’s Per  Occurrence Limit |       | $                 | 30,000,000 |               | $          | 190,000,000 |   |
| Reinsurer’s  Annual Limit         |       | $                 | 60,000,000 |               | $          | 380,000,000 |   |
| Minimum Premium                        |       | $                 | 1,980,000  |               | $          | 4,940,000 |   |
| Adjustable  Premium Rate               |       | 2.226             | %          | 5.553              | %          |
| Deposit Premium                        |       | $                 | 2,475,000  |               | $          | 6,175,000 |   |
| Quarterly Deposit  Premium             |       | $                 | 618,750    |               | $          | 1,543,750 |   |

 

The figures listed above for each excess layer shall apply to eachSubscribing Reinsurer in the percentage share for that excess layer asexpressed in its Interests and Liabilities Agreement attached hereto.

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**Nuclear IncidentExclusion Clause - Physical Damage - Reinsurance (U.S.A.)**

1.         ThisReinsurance does not cover any loss or liability accruing to the Reassured, directlyor indirectly and whether as Insurer or Reinsurer, from any Pool of Insurers orReinsurers formed for the purpose of covering Atomic or Nuclear Energy risks.

2.         Without inany way restricting the operation of paragraph (1) of this Clause, this Reinsurancedoes not cover any loss or liability accruing to the Reassured, directly orindirectly and whether as Insurer or Reinsurer, from any insurance againstPhysical Damage (including business interruption or consequential loss arisingout of such Physical Damage) to:

I.         Nuclearreactor power plants including all auxilliary property on the site, or

II.        Anyother nuclear reactor installation, including laboratories handling radioactivematerials in connection with reactor installations, and “critical facilities”as such, or

III.      Installationsfor fabricating complete fuel elements or for processing substantial quantitiesof “special nuclear material,” and for reprocessing, salvaging, chemicallyseparating, storing or disposing of “spent” nuclear fuel or waste materials, or

IV.      Installationsother than those listed in paragraph (2) III above using substantial quantitiesof radioactive Isotopes or other products of nuclear fission.

3.         Without inany way restricting the operations of paragraphs (1) and (2) hereof, thisReinsurance does not cover any loss or liability by radioactive contaminationaccruing to the Reassured, directly or indirectly, and whether as Insurer orReinsurer, from any insurance on property which is on the same site as anuclear reactor power plant or other nuclear installation and which normallywould be insured therewith except that this paragraph (3) shall not operate

(a)       whereReassured does not have knowledge of such nuclear reactor power plant ornuclear installation, or

(b)      wheresaid insurance contains a provision excluding coverage for damage to propertycaused by or resulting from radioactive contamination, however caused. Howeveron and after 1st January 1960 this sub-paragraph (b) shall only apply providedthe said radioactive contamination exclusion provision has been approved by theGovernmental Authority having jurisdiction thereof.

Without in any way restricting the operations of paragraphs (1), (2)and (3) hereof, this Reinsurance does not cover any loss or liability by radioactivecontamination accruing to the Reassured, directly or indirectly, and whether asInsurer or Reinsurer, when such radioactive contamination is a named hazardspecifically insured against.

5.         It isunderstood and agreed that this Clause shall not extend to risks usingradioactive isotopes in any form where the nuclear exposure is not consideredby the Reassured to be the primary hazard.

8.         The term “specialnuclear material” shall have the meaning given it in the Atomic Energy Act of1964 or by any law amendatory thereof.

7.         Reassuredto be sole judge of what constitutes:

(a)       substantialquantities, and

(b)      theextent of installation, plant or site.

*Note.*Without in any wayrestricting the operation of paragraph (1) hereof, it is understood and agreedthat

(a)       allpolicies issued by the Reassured on or before 31st December 1957 shall be freefrom the application of the other provisions of this Clause until expiry dateor 31st December 1960 whichever first occurs whereupon all the provisions ofthis Clause shall apply.

(b)      withrespect to any risk located in Canada policies issued by the Reassured on orbefore 31st December 1958 shall be free from the application of the otherprovisions of this Clause until expiry date or 31st December 1960 whicheverfirst occurs whereupon all the provisions of this Clause shall apply.

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**Total Insured ValueExclusion Clause**

It is the mutual intention of the parties to exclude risks, other thanOffices, Hotels, Apartments, Hospitals, Educational Establishments and PublicUtilities (except Railroad Schedules), and Builders Risks on the above classes,where at the time of cession, the Total Insured Value over all interestsexceeds $250,000,000. However, the Company shall be protected hereunder,subject to the other terms and conditions of this Contract, if subsequent tocession being made, the Company becomes acquainted with the true facts of thecase and discovers that the mutual intention has been inadvertently breached;on condition that the Company shall at the first opportunity, and certainly bynext anniversary of the original policy, exclude the risk in question.

It is agreed that this mutual intention does not apply to ContingentBusiness interruption or to interests traditionally underwritten as InlandMarine or to Stock and/or Contents written on a blanket basis except where theCompany is aware that the Total Insured Value of $250,000,000 is alreadyexceeded for buildings, machinery, equipment and direct use and occupancy atthe key location.

It is understood and agreed that this Clause shall not apply hereunderwhere the Company writes 100% of the risk.

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**Terrorism ExclusionClause**

A.       Notwithstandingany provision to the contrary within this Contract or any addendum thereto, itis agreed that this Contract excludes loss, damage, cost or expense directly orindirectly caused by, contributed to by, resulting from, arising out of or inconnection with any “act of terrorism,” as defined in the Terrorism RiskInsurance Act of 2002, as amended by the Terrorism Risk Insurance Extension Actof 2005 (together the “Terrorism Act”), on primary or excess property andcasualty insurance issued by the Company, regardless of any other cause orevent contributing concurrently or in any sequence to the loss.

B.        Notwithstandingthe above and subject otherwise to the terms, conditions and limitations ofthis Contract, this Contract will pay actual loss or damage caused by any actof terrorism which does not meet the definition of “insured loss” set forth inthe Terrorism Act or meets the definition of “insured loss” as set forth in theTerrorism Act, but results in loss under a policy that is not included in “propertyand casualty insurance” as defined in the Terrorism Act, provided, in eithercase, (1) such loss or damage occurs in a line of insurance otherwise coveredby this Contract, and (2) in no event will this Contract provide coverage forloss, damage, cost or expense directly or indirectly caused by, contributed toby, resulting from, or arising out of or in connection with biological, chemical,radioactive or nuclear explosion, pollution, contamination and/or firefollowing thereon.

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