<PAGE>



                            SCOTTISH RE GROUP LIMITED

                          CONVERTIBLE PREFERRED SHARES



                              REMARKETING AGREEMENT

                                                               December 17, 2003


BEAR, STEARNS & CO. INC.
383 Madison Avenue
New York, New York 10179

Ladies and Gentlemen:

                  Scottish Re Group Limited, a Cayman Islands exempted company
(the "Company"), is issuing today 5,000,000 shares of its Convertible Preferred
Shares, $25 liquidation preference per share(and may issue up to an additional
750,000 shares to the extent that the over-allotment option is exercised
pursuant to the Underwriting Agreement (as defined below)) (the "Convertible
Preferred Shares"), pursuant to a Certificate of Designations (the "Certificate
of Designations") duly adopted by a resolution of the duly authorized committee
of the Board of Directors of the Company on December 11, 2003, and a Purchase
Contract Agreement, dated as of December 17, 2003 (the "Purchase Contract
Agreement"), between the Company and JPMorgan Chase Bank, as purchase contract
agent. Capitalized terms used but not defined in this Remarketing Agreement
(this "Agreement") shall have the meanings set forth in the Certificate of
Designations or the Purchase Agreement, as the case may be.

                  The Remarketing (as defined below) of the Convertible
Preferred Shares is provided for in the Certificate of Designations and the
Purchase Contract Agreement. As used in this Agreement, the term "Remarketed
Convertible Preferred Shares" means the Convertible Preferred Shares subject to
the Remarketing on the fourth Trading Day prior to the Purchase Contract
Settlement Date; the term "Remarketing Procedures" means the procedures in
connection with the Remarketing of the Convertible Preferred Shares described in
the Certificate of Designations, the Purchase Contract Agreement and this
Agreement; and the term "Remarketing" means the remarketing of the Remarketed
Convertible Preferred Shares pursuant to the Remarketing Procedures.

                  It is understood and agreed between the parties hereto that
the Remarketing shall be conducted for the benefit of the holders of the
Convertible Preferred Shares.

                  Section 1. Appointment and Obligations of the Remarketing
Agent. (a) The Company hereby appoints Bear, Stearns & Co. Inc., and Bear,
Stearns & Co. Inc. hereby accepts appointment, as exclusive remarketing agent
(the "Remarketing Agent") for the purpose of (i) Remarketing the Remarketed
Convertible Preferred Shares on behalf of the holders thereof and


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                                                                               2

(ii) performing such other duties as are assigned to the Remarketing Agent in
the Remarketing Procedures, all in accordance with and pursuant to the
Remarketing Procedures.

                  (b) The Remarketing Agent agrees (i) to use commercially
reasonable efforts to remarket the Remarketed Convertible Preferred Shares
included in the Remarketing, (ii) to notify the Company promptly of the Reset
Rate and (iii) to carry out such other duties as are assigned to the Remarketing
Agent in the Remarketing Procedures, all in accordance with the provisions of
the Remarketing Procedures.

                  (c) On the fourth Trading Day immediately preceding the
Purchase Contract Settlement Date (the "Remarketing Date"), the Remarketing
Agent shall use commercially reasonable efforts to remarket, at a minimum price
of 100.25% of the aggregate liquidation preference thereof the Remarketed
Convertible Preferred Shares included in the Remarketing.

                  (d) If, as a result of the efforts described in Section 1(b),
the Remarketing Agent determines that it will be able to remarket all Remarketed
Convertible Preferred Shares included in the Remarketing for purchase at a
minimum price of 100.25% of the aggregate liquidation preference of such
Remarketed Convertible Preferred Shares prior to 4:00 p.m., New York City time,
on the Remarketing Date, the Remarketing Agent shall determine the Reset Rate,
which shall be the rate per annum (rounded to the nearest one-thousandth (0.001)
of one percent) that the Remarketing Agent determines, in its sole judgment, to
be the lowest rate per annum, but not less than the original Dividend Rate on
the Convertible Preferred Shares, that will enable it to remarket, at such
price, all of the Remarketed Convertible Preferred Shares tendered or deemed
tendered for Remarketing.

                  (e) If none of the holders of Remarketed Convertible Preferred
Shares or the holders of Hybrid Capital Units elects to have Remarketed
Convertible Preferred Shares remarketed in the Remarketing, the Remarketing
Agent shall, in its sole discretion, determine the rate that would have been
established had a Remarketing of all the Convertible Preferred Shares been held
on the Remarketing Date, and such rate shall be the Reset Rate.

                  (f) If, by 4:30 p.m., New York City time, on the Remarketing
Date, the Remarketing Agent is unable to remarket all Remarketed Convertible
Preferred Shares included in the Remarketing, a failed Remarketing (the "Failed
Remarketing") shall be deemed to have occurred, and the Remarketing Agent shall
so advise by telephone the Depositary and the Company. If a Failed Remarketing
occurs, the Reset Rate will be equal to (i) 3-month LIBOR, plus (ii) a spread as
set forth in the Certificate of Designations.

                  (g) By approximately 4:30 p.m., New York City time, on the
Trading Day following the Remarketing Date, provided that there has not been a
Failed Remarketing, the Remarketing Agent shall advise, by telephone, (i) the
Depositary and the Company of the Reset Rate determined in the Remarketing and
the number of Remarketed Convertible Preferred Shares sold in the Remarketing,
(ii) each purchaser (or the Depositary Participant thereof) of the Reset Rate
and the number of Remarketed Convertible Preferred Shares such purchaser is to
purchase and (iii) each purchaser to give instructions to its Depositary
Participant to pay the purchase price on the Purchase Contract Settlement Date
in same day funds against delivery of the Remarketed Convertible Preferred
Shares purchased through the facilities of the Depositary.

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                                                                               3

The purchase price shall include any accrued and unpaid dividends as of the
Remarketing Settlement Date.

                  (h) The Remarketing Agent shall remit (i) to the collateral
agent for the Hybrid Capital Units (the "Collateral Agent") proceeds of the
Remarketed Convertible Preferred Shares subject to the Pledge Agreement, dated
as of December 17, 2003, made by JPMorgan Chase Bank, on behalf of the holders
of Hybrid Capital Units, in favor of the Company (the "Pledge Agreement"), in an
amount equal to the proceeds from the Remarketing (net of the Remarketing Fee)
of such Remarketed Convertible Preferred Shares and (ii) to the Custodial Agent
proceeds from the Remarketing (net of the Remarketing Fee) of such Remarketed
Convertible Preferred Shares.

                  Section 2. Representations, Warranties and Agreements of the
Company. The Company hereby represents and warrants to the Remarketing Agent (i)
on and as of the date hereof, (ii) on and as of the date the Prospectus or other
Remarketing Materials (each, as defined in Section 2(a) below) which are first
distributed in connection with the Remarketing (the "Commencement Date"), (iii)
on and as of the Remarketing Date and (iv) on and as of the Remarketing
Settlement Date that:

                  (a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-104545), and amendments thereto, and related preliminary prospectuses for
the registration under the Securities Act of 1933, as amended (the "Securities
Act"), relating to the registration of certain securities (the "Shelf
Securities") of the Company to be sold from time to time by the Company. Such
registration statement, as so amended (including post-effective amendments, if
any), has (i) been prepared by the Company in conformity with the requirements
of the Securities Act, and the rules and regulations (the "Rules and
Regulations") of the Commission thereunder, (ii) been filed with the Commission
under the Securities Act and (iii) become effective under the Securities Act;
and a registration statement or registration statements on Form S-3, if required
to be filed in connection with the Remarketing, will also be prepared by the
Company in conformity with the requirements of the Securities Act and the Rules
and Regulations and filed with the Commission under the Securities Act. Copies
of such registration statements that have become effective and the amendment or
amendments to such registration statements have been delivered or made available
by the Company to Bear, Stearns & Co. Inc. As used in this Agreement, "Effective
Time" means the date and time as of which the last of such registration
statements that have become effective or may be filed, or the most recent
post-effective amendment thereto, if any, was declared effective by the
Commission; "Effective Date" means the date of the Effective Time of such last
registration statement; "Preliminary Prospectus" means each prospectus included
in such last registration statement, or amendment thereto, before it became
effective under the Securities Act and any prospectus filed by the Company with
your consent pursuant to Rule 424(a) of the Rules and Regulations; "Registration
Statement" means such last registration statement, as amended at its Effective
Time, including documents incorporated by reference therein at such time and, if
applicable, all information contained in the final prospectus and any prospectus
supplement thereto relating to the Convertible Preferred Shares filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations, including any
information deemed to be part of such Registration Statement as of the Effective
Time pursuant to paragraph (b) of Rule 430A of the Rules and Regulations; and
"Prospectus" means the last of such final prospectus relating to the Convertible
Preferred Shares, as first filed pursuant to Rule 424(b) of the Rules and
Regulations and any prospectus supplement thereto relating to the Convertible
Preferred Shares. Reference made herein to any Preliminary Prospectus, the
Prospectus or any other information furnished in writing by the Company to the
Remarketing Agent for distribution to investors in connection with the
Remarketing (the

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                                                                               4

"Remarketing Materials") shall be deemed to refer to and include any documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
Securities Act as of the date of such Preliminary Prospectus or the Prospectus,
as the case may be, or, in the case of Remarketing Materials, referred to as
incorporated by reference therein, and any reference to any amendment or
supplement to any Preliminary Prospectus, the Prospectus or the Remarketing
Materials shall be deemed to refer to and include any document filed under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), after the date
of such Preliminary Prospectus or the Prospectus incorporated by reference
therein pursuant to Item 12 of Form S-3 or, if so incorporated, the Remarketing
Materials, as the case may be; and any reference to any amendment to the
Registration Statement shall be deemed to include any annual report of the
Company filed with the Commission pursuant to Section 13(a) or 15(d) of the
Exchange Act after the Effective Time that is incorporated by reference in the
Registration Statement.

                  (b) The Registration Statement conforms (and the Prospectus,
any further amendments or supplements to the Registration Statement or the
Prospectus and any new registration statement, when they become effective or are
filed with the Commission, as the case may be, will conform) in all material
respects to the requirements of the Securities Act and the Rules and
Regulations, and the Registration Statement, the Prospectus and the Remarketing
Materials do not and will not, as of the Effective Date (as to the Registration
Statement and any amendment thereto), as of the applicable filing date (as to
the Prospectus and any amendment or supplement thereto) and as of the
Commencement Date, Remarketing Date and Purchase Contract Settlement Date (as to
any Remarketing Materials) contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein (i) in the case of the Registration Statement, not
misleading, and (ii) in the case of the Prospectus or any related Preliminary
Prospectus in light of the circumstances under which they were made, not
misleading; provided that no representation and warranty is made as to
information contained in or omitted from the Registration Statement, the
Prospectus or the Remarketing Materials in reliance upon and in conformity with
written information furnished to the Company by the Remarketing Agent
specifically for inclusion therein; and the Commission has not issued an order
preventing or suspending the use of the Registration Statement, any Preliminary
Prospectus, the Prospectus or the Remarketing Materials.

                  (c) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, at the time they were or hereafter are filed with
the Commission, complied and will comply in all material respects with the
requirements of the Securities Act, the Exchange Act, the Rules and Regulations
and the rules and regulations of the Commission under the Exchange Act, and,
when read together with the other information in the Prospectus, at the time the
Registration Statement became effective, did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

                  (d) Each of the Company and its subsidiaries has been duly
organized and is validly existing as a corporation or a company limited by
shares in good standing under the laws of its jurisdiction of incorporation.
Each of the Company and its subsidiaries is duly qualified to do business and is
in good standing as a foreign corporation in each jurisdiction in which the
character or location of its properties (owned, leased or licensed) or the
nature or conduct of its business makes such qualification necessary, except for
those failures to be so qualified or in good standing which will not in the
aggregate have a Material Adverse Effect (as hereinafter

<PAGE>

                                                                               5

defined) on the condition (financial or otherwise), results of operations,
business, properties or prospects of the Company and its subsidiaries taken as a
whole. Each of the Company and its subsidiaries has all requisite power and
authority, and all necessary consents, approvals, authorizations, orders,
registrations, qualifications, licenses and permits (collectively, the
"Consents") of and from all public, regulatory or governmental agencies and
bodies, to own, lease and operate its properties and conduct its business as now
being conducted and as described in the Registration Statement, the Prospectus
and any Remarketing Materials, with such exceptions as would not have,
individually or in the aggregate a Material Adverse Effect. No Consent contains
a materially burdensome restriction not adequately disclosed in the Registration
Statement, the Prospectus and any Remarketing Materials.

                  (e) The Company has an authorized capitalization as set forth
in the Prospectus and in any Remarketing Materials; all of the issued shares of
capital stock of the Company has been duly and validly authorized and issued and
is fully paid and non-assessable; and all of the issued shares of capital stock
of each subsidiary of the Company, except as set forth in the Prospectus, are
owned directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims.

                  (f) The Hybrid Capital Units have been duly authorized by the
Company, and when duly executed by the Company (assuming due execution by the
Purchase Contract Agent as attorney-in-fact for the holders thereof and due
authentication by the Purchase Contract Agent) and delivered by the Company and,
upon payment therefor as set forth herein, will be duly and validly issued and
outstanding, and will constitute valid and binding obligations of the Company
entitled to the benefits of the Purchase Contract Agreement and enforceable
against the Company in accordance with their terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally or by
general equitable principles, regardless of whether enforcement is considered in
a proceeding in equity or at law (the "Bankruptcy Exceptions"), and an implied
covenant of good faith and fair dealing.

                  (g) The Convertible Preferred Shares and Remarketed
Convertible Preferred Shares have been duly authorized by the Company and, when
issued and delivered against payment therefor as provided by the Underwriting
Agreement, dated December 11, 2003 (the "Underwriting Agreement"), between the
Company and Bear, Stearns & Co. Inc., UBS Securities LLC, and J.P. Morgan
Securities Inc. will be duly and validly issued, fully paid as to their stated
price of $25 per share and non-assessable and will not be subject to the
preemptive rights of any person.

                  (h) This Agreement has been duly authorized, executed and
delivered by the Company.

                  (i) The Purchase Contract Agreement has been duly authorized
by the Company and, when duly executed by the proper officers of the Company
(assuming due execution and delivery by the Purchase Contract Agent) and
delivered by the Company, will constitute a valid and binding agreement of the
Company enforceable against the Company in accordance with its terms, except as
the enforcement thereof may be limited by the Bankruptcy Exceptions and an
implied covenant of good faith and fair dealing.


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                                                                               6

                  (j) The Pledge Agreement has been duly authorized by the
Company and, when duly executed by the proper officers of the Company (assuming
due execution and delivery by the Purchase Contract Agent and the Collateral
Agent) and delivered by the Company, will constitute a valid and binding
agreement of the Company enforceable against the Company in accordance with its
terms, except as the enforcement thereof may be limited by the Bankruptcy
Exceptions and an implied covenant of good faith and fair dealing.

                  (k) The Remarketed Convertible Preferred Shares, the
Certificate of Designations and the Remarketing Agreement, will conform to the
descriptions thereof contained in the Prospectus and in any Remarketing
Materials.

                  (l) The execution, delivery and performance of this Agreement,
the Purchase Contract Agreement, the Pledge Agreement and the Remarketing
Agreement and the consummation of the transactions contemplated by this
Agreement, the Purchase Contract Agreement, the Pledge Agreement, the
Remarketing Agreement, the Registration Statement and the Prospectus do not and
will not (i) conflict with or result in a breach of any of the terms and
provisions of, or constitute a default (or an event which with notice or lapse
of time, or both, would constitute a default) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any of its subsidiaries pursuant to any indenture, mortgage, deed
of trust, loan agreement or other agreement, instrument, franchise, license or
permit to which the Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries or their respective properties or assets
may be bound or (ii) violate or conflict with any provision of the memorandum of
association, articles of association, certificate or articles of incorporation,
charter, by-laws or other organizational documents of the Company or any of its
subsidiaries or any judgment, decree, order, statute, rule or regulation of any
court or any public, governmental or regulatory agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
respective properties, operations or assets. No consent, approval,
authorization, order, registration, filing, qualification, license or permit of
or with any court or any public, governmental or regulatory agency or body
having jurisdiction over the Company or any of the Subsidiaries or any of their
respective properties or assets is required to be made or obtained by the
Company for the execution, delivery and performance of this Agreement, the
Purchase Contract Agreement, the Pledge Agreement and the Remarketing Agreement
or the consummation of the transactions contemplated hereby or thereby, by the
Registration Statement and by the Prospectus, including the issuance, sale and
delivery of the Units to be issued, sold and delivered by the Company hereunder,
except (A) the registration under the Securities Act of the Units, the Preferred
Shares and the Ordinary Shares, which has become effective, and (B) such
consents, approvals, authorizations, orders, registrations, filings,
qualifications, licenses and permits as may be required under state securities,
Blue Sky or insurance securities laws or the rules of the National Association
of Securities Dealers, Inc. (the "NASD") in connection with the purchase and
distribution of the Units by the Underwriters.

                  (m) Except as disclosed in the Registration Statement and
Prospectus, no holder of securities of the Company has any rights to the
registration of securities of the Company because of the filing of the
Registration Statement or otherwise in connection with the sale of the Units
contemplated hereby, and any such rights so disclosed have been effectively
waived by the holders thereof.


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                                                                               7

                  (n) Subsequent to the respective dates as of which information
is given in the Registration Statement, the Prospectus and any Remarketing
Materials, except as set forth in the Registration Statement, the Prospectus and
any Remarketing Materials, the Company has not paid any dividends on any class
of its share capital and there has been no material adverse change or any
development involving a prospective material adverse change on (i) the business,
prospects, properties, operations, condition (financial or other), stockholders'
equity or results of operations of the Company and each subsidiary of the
Company, taken as a whole; (ii) the share capital or long-term debt of the
Company; (iii) the Offering; or (iv) the consummation of the transactions
contemplated by this Agreement, the Purchase Contract Agreement, the Pledge
Agreement and the Remarketing Agreement or the Company's performance of its
obligations hereunder (a "Material Adverse Change" or "Material Adverse
Effect"), whether or not arising from transactions in the ordinary course of
business, and since the date of the latest balance sheet presented in the
Registration Statement, the Prospectus and any Remarketing Materials, neither
the Company nor any of its subsidiaries has incurred or undertaken any
liabilities or obligations, direct or contingent, or entered into any
transactions which are material to the Company and its subsidiaries taken as a
whole, except for liabilities or obligations which are reflected in the
Registration Statement, the Prospectus and any Remarketing Materials.

                  (o) The financial statements of the Company, including the
notes thereto, and supporting schedules included or incorporated by reference in
the Registration Statement, the Prospectus and any Remarketing Materials present
fairly in all material respects the financial position of the Company and its
consolidated subsidiaries and the other entities for which financial statements
are included in the Registration Statement, the Prospectus and any Remarketing
Materials as of the dates indicated and condition and results of operations for
the periods specified; except as otherwise stated in the Registration Statement,
said financial statements have been prepared in conformity with U.S. generally
accepted accounting principles ("GAAP") in all material respects applied on a
consistent basis throughout the periods involved; and the supporting schedules
included in the Registration Statement present fairly in all material respects
the information required to be stated therein. No other financial statements or
supporting schedules are required to be included in the Registration Statement,
the Prospectus or any Remarketing Materials. The other financial and statistical
information and data relating to the Company and its consolidated subsidiaries
included in the Registration Statement, the Prospectus and any Remarketing
Materials present fairly in all material respects the information included
therein and have been prepared on a basis consistent with that of the financial
statements included or incorporated by reference in the Registration Statement
and the Prospectus and the books and records of the respective entities
presented therein.

                  (p) Ernst & Young LLP, who have certified the financial
statements and supporting schedules of the Company included or incorporated in
the Registration Statement, are independent public accountants as required by
the Securities Act, the Exchange Act and the Rules and Regulations.

                  (q) Any real property and buildings held under lease or
sublease by the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material and
do not interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries. Neither the Company nor any of
its subsidiaries has received any notice of any claim adverse to their ownership
of any real or

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                                                                               8

personal property or of any claim against the continued possession of any real
property, whether owned or held under lease or sublease by the Company or any of
its subsidiaries.

                  (r) Except as described in the Registration Statement, the
Prospectus and any Remarketing Materials, there is no judicial, regulatory,
arbitral or other legal or governmental proceeding or other litigation, or
arbitration, including routine litigation, to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of its
subsidiaries is the subject which, individually or in the aggregate, if
determined adversely to the Company or any of its subsidiaries, is reasonably
likely to have a Material Adverse Effect, and to the best of the Company's
knowledge, no such proceeding is threatened or contemplated by governmental
authorities or threatened or contemplated by others.

                  (s) The conditions for use of Form S-3, as set forth in the
General Instructions thereto, have been satisfied.

                  (t) There are no contracts or other documents which are
required to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and Regulations
which have not been described in the Prospectus or filed as exhibits to the
Registration Statement or incorporated therein by reference as permitted by the
Rules and Regulations.

                  (u) Neither the Company nor any of its subsidiaries (i) is in
violation of its memorandum of association, articles of association, certificate
or articles of incorporation, charter or by-laws, (ii) is in default (and no
event has occurred which, with notice or lapse of time or both, would constitute
such a default) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which it is a party or by which it is bound
or to which any of its property or assets is subject or (iii) is in violation in
any respect of any statute or any judgment, decree, order, rule or regulation of
any court or governmental or regulatory agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their properties or assets,
except in the case of (iii), any violation or default that would not have a
Material Adverse Effect on the condition (financial or otherwise), results of
operations, business, properties or prospects of the Company and its
subsidiaries taken as a whole.

                  (v) The Company is not, and upon consummation of the
transactions contemplated hereby, and at all times up to and including the
application of net proceeds as described in the Prospectus or any Remarketing
Materials, will not be, subject to registration as an "investment company" under
the Investment Company Act of 1940.

                  (w) Each of the Company and its subsidiaries which is engaged
in the business of insurance or reinsurance (each, an "Insurance Subsidiary" and
together, the "Insurance Subsidiaries") holds such insurance license,
certificates and permits from governmental authorities (including, without
limitation, from the insurance regulatory agencies of the various jurisdictions
where it conducts business) (the "Insurance Licenses") as are necessary to the
conduct of its business as described in the Prospectus or any Remarketing
Materials; the Company and each Insurance Subsidiary have fulfilled and
performed all obligations necessary to maintain the Insurance Licenses; there is
no pending or, to the knowledge of the Company


<PAGE>

                                                                               9

after due inquiry, threatened action, suit, proceeding or investigation that
could reasonably be expected to result in the revocation, termination or
suspension of any Insurance License; and no insurance regulatory agency or body
has issued, or to our knowledge, commenced any proceeding for the issuance of,
any order or decree impairing, restricting or prohibiting the payment of
dividends or the making of any loan by any Subsidiary to its parent, which would
have, individually or in the aggregate, a Material Adverse Effect.

                  (x) All reinsurance treaties and arrangements to which the
Company or any of its subsidiaries is a party as a cedant are in full force and
effect; neither the Company nor any of its subsidiaries is in material violation
of or in material default in the performance, observance or fulfillment of any
obligation, agreement, covenant or condition contained therein; neither the
Company nor any of its subsidiaries has received any notice from any of the
other parties to such treaties or arrangements that such other party intends not
to perform such treaty; and, to the best knowledge of the Company and its
subsidiaries, the Company and its subsidiaries have no reason to believe that
any of the other parties to such treaties or arrangements will be unable to
perform such treaty or arrangement except to the extent adequately and properly
reserved for in the consolidated financial statements of the Company included in
the Prospectus.

                  (y) The Company is not aware of any threatened or pending
downgrading of any Insurance Subsidiary's financial strength rating from A.M.
Best Company, Inc., Standard & Poor's Rating Services, Inc., Moody's Investor
Services or Fitch Ratings (collectively, the "Rating Agencies").

                  (z) The Company and its subsidiaries expect to engage
predominantly in traditional insurance and reinsurance activities that involve
substantial transfer of insurance or annuity risks, and intend to operate in a
manner that they will not (1) engage in certain nontraditional insurance or
reinsurance activities that do not involve a sufficient amount of risk transfer
or (2) maintain financial reserves in excess of the reasonable needs of the
insurance business of the Company and its subsidiaries, either of which would
cause the insurance company exception to the passive foreign investment company
rules described in Section 1297 of the Internal Revenue Code of 1986, as amended
from time to time (the "Code"), not to apply to the Company or its subsidiaries.

                  Section 3. Fees and Expenses. (a) For the performance of its
services as Remarketing Agent hereunder, the Remarketing Agent shall retain on
the Purchase Contract Settlement Date 0.25% of the amount of the proceeds (other
than in respect of accrued and unpaid dividends on the Remarketed Convertible
Preferred Shares) received in the Remarketing (the "Remarketing Fee").

                  (b) The Company agrees to pay (i) the costs incident to the
preparation and printing of the Registration Statement, Prospectus and any
Remarketing Materials and any amendments or supplements thereto; (ii) the costs
of distributing the Registration Statement, Prospectus and any Remarketing
Materials and any amendments or supplements thereto; (iii) the fees and expenses
of qualifying the Remarketed Convertible Preferred Securities under the
securities laws of the several jurisdictions as provided in Section 4(h) and of
preparing, printing and distributing a Blue Sky memorandum (including related
fees and expenses of counsel to the Remarketing Agent); and (iv) all other costs
and expenses incident to the performance of the obligations of the Company
hereunder.


<PAGE>

                                                                              10

                  Section 4. Further Agreements of the Company. The Company
agrees to use its commercially reasonable efforts:

                  (a) To prepare any registration statement or prospectus, if
and to the extent required by applicable law, in connection with the
Remarketing, in a form reasonably acceptable to the Remarketing Agent, and to
file any such prospectus pursuant to the Securities Act within the period
required by the Rules and Regulations; to advise the Remarketing Agent, promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any supplement to
the Prospectus or any amended Prospectus has been filed and to furnish the
Remarketing Agent with copies thereof; to file promptly all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or sale of
the Remarketed Convertible Preferred Shares; to advise the Remarketing Agent,
promptly after it receives notice thereof, of the issuance by the Commission of
any stop order or of any order preventing or suspending the use of the
Prospectus, of the suspension of the qualification of any shares of the
Remarketed Convertible Preferred Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any such
purpose or of any request by the Commission for the amending or supplementing of
the Registration Statement or the Prospectus or for additional information; and,
in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Prospectus or suspending any such qualification, to
use promptly its best efforts to obtain its withdrawal.

                  (b) To furnish or make available promptly to the Remarketing
Agent and to counsel for the Remarketing Agent a signed copy of the Registration
Statement as originally filed with the Commission, and each amendment thereto
filed with the Commission, including all consents and exhibits filed therewith.

                  (c) To deliver or make available promptly to the Remarketing
Agent in New York City a reasonable number of the following documents: (i)
conformed copies of the Registration Statement as originally filed with the
Commission and each amendment thereto, (ii) the Prospectus and any amended or
supplemented Prospectus, (iii) any document incorporated by reference in the
Prospectus (excluding exhibits thereto) and (iv) any Remarketing Materials; and,
if the delivery of a prospectus is required at any time in connection with the
Remarketing and if at such time any event shall have occurred as a result of
which the Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or if
for any other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the
Securities Act or the Exchange Act, to notify the Remarketing Agent and, upon
its request, to file such document and to prepare and furnish without charge to
the Remarketing Agent and to any dealer in securities a reasonable number of
copies of an amended or supplemented Prospectus which will correct such
statement or omission or effect such compliance.

                  (d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the reasonable judgment of the

<PAGE>

                                                                              11

Company or the Remarketing Agent, be required by the Securities Act or requested
by the Commission.

                  (e) Prior to filing with the Commission (i) any amendment to
the Registration Statement or supplement to the Prospectus or any document
incorporated by reference in the Prospectus or (ii) any Prospectus pursuant to
Rule 424 of the Rules and Regulations, to furnish or make available a copy
thereof to the Remarketing Agent and counsel for the Remarketing Agent; and not
to file any such amendment or supplement which shall be disapproved by the
Remarketing Agent promptly after reasonable notice (approval thereof not to be
unreasonably withheld).

                  (f) As soon as practicable after the Effective Date of the
Registration Statement, to make generally available to the Company's security
holders and to deliver to the Remarketing Agent an earnings statement of the
Company and its subsidiaries (which need not be audited) complying with Section
11(a) of the Securities Act and the Rules and Regulations (including, at the
option of the Company, Rule 158).

                  (g) During a period of five years following the Effective Date
of the Registration Statement (or until no Convertible Preferred Shares are
outstanding, if earlier), to deliver or make available to the Remarketing Agent
copies of all reports or other communications (financial or other) furnished to
shareholders of the Company (except to the extent available through the
Commission's EDGAR System) , and deliver to the Remarketing Agent, (i) as soon
as they are available, copies of any reports and financial statements furnished
to or filed by the Company with the Commission or any national securities
exchange on which any of the Remarketed Convertible Preferred Shares or any
class of securities of the Company may be listed (except to the extent available
through the Commission's EDGAR System); and (ii) such additional information
concerning the business and financial condition of the Company as the
Remarketing Agent may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports furnished to the
Company's shareholders generally or to the Commission).

                  (h) Promptly from time to time to take such action as the
Remarketing Agent may reasonably request to qualify any shares of the Remarketed
Convertible Preferred Shares for offering and sale under the securities laws of
such jurisdictions as the Remarketing Agent may request and to comply with such
laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of
the Remarketed Convertible Preferred Shares; provided that in connection
therewith, the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction.

                  Section 5. Conditions to the Remarketing Agent's Obligations.
The obligations of the Remarketing Agent hereunder are subject to the accuracy,
on and as of the date when made, of the representations and warranties of the
Company contained herein, to the performance by the Company of its obligations
hereunder and to each of the following additional terms and conditions:

<PAGE>

                                                                              12

                  (a) The Prospectus shall have been timely filed with the
Commission; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for that
purpose shall have been initiated or threatened by the Commission; and any
request of the Commission for inclusion of additional information in the
Registration Statement or the Prospectus or otherwise shall have been complied
with.

                  (b) The Remarketing Agent shall not have discovered and
disclosed to the Company on or prior to the Remarketing Date that the
Prospectus, the Registration Statement or the Remarketing Materials or any
amendment or supplement thereto contains any untrue statement of a fact which,
in the opinion of counsel for the Remarketing Agent, is material or omits to
state any fact which, in the opinion of such counsel, is material and is
required to be stated therein or is necessary to make the statements therein not
misleading.

                  (c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Purchase Contract
Agreement, the Convertible Preferred Shares, the Hybrid Capital Units, the
Remarketed Convertible Preferred Shares, the Prospectus, each Registration
Statement, the Remarketing Materials and all other legal matters relating to
this Agreement and the transactions contemplated hereby shall be reasonably
satisfactory in all material respects to counsel for the Remarketing Agent, and
the Company shall have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon such matters.

                  (d) U.S. counsel to the Company shall have furnished to the
Remarketing Agent its written opinion, as U.S. counsel to the Company, addressed
to the Remarketing Agent and dated the Remarketing Settlement Date, in form and
substance satisfactory to the Remarketing Agent, substantially to the effect of
Annex I(A) to the Underwriting Agreement, appropriately modified to include all
the Transactions and the Remarketed Convertible Preferred Shares.

                  (e) The Company's general counsel shall have furnished to the
Remarketing Agent a written opinion, addressed to the Remarketing Agent and
dated the Remarketing Date, in form and substance satisfactory to the
Remarketing Agent, substantially to the effect of Annex I(B) to the Underwriting
Agreement, appropriately modified to include all the Transactions and the
Remarketed Convertible Preferred Shares.

                  (f) Cayman Islands counsel to the Company shall have furnished
to the Remarketing Agent its written opinion, as Cayman Islands counsel to the
Company, addressed to the Remarketing Agent and dated the Remarketing Date, in
form and substance satisfactory to the Remarketing Agent, substantially to the
effect of Annex II to the Underwriting Agreement, appropriately modified to
include all the Transactions and the Remarketed Convertible Preferred Shares.

                  (g) Counsel to the Purchase Contract Agent shall have
furnished to the Remarketing Agent its written opinion, as counsel to the
Purchase Contract Agent, addressed to the Remarketing Agent and dated the
Remarketing Settlement Date, in form and substance satisfactory to the
Remarketing Agent, to the effect that:

                       (i) The Purchase Contract Agent is duly incorporated
                  and is validly existing as a banking corporation in good
                  standing under the laws of the


<PAGE>

                                                                              13

                  jurisdiction of its incorporation with all necessary
                  corporate power and authority to execute, deliver and
                  perform its obligations under the Purchase Contract
                  Agreement and the Pledge Agreement.

                       (ii) The execution, delivery and performance by the
                  Purchase Contract Agent of the Purchase Contract Agreement
                  and the Pledge Agreement and the authentication and delivery
                  of the Hybrid Capital Units have been duly authorized by all
                  necessary corporate action on the part of the Purchase
                  Contract Agent. The Purchase Contract Agreement and the
                  Pledge Agreement have been duly executed and delivered by
                  the Purchase Contract Agent and constitute the valid and
                  binding agreements of the Purchase Contract Agent,
                  enforceable against the Purchase Contract Agent in
                  accordance with their respective terms, except as the
                  enforcement thereof may be limited by the Bankruptcy
                  Exceptions and an implied covenant of good faith and fair
                  dealing.

                       (iii) The execution, delivery and performance of the
                  Purchase Contract Agreement and the Pledge Agreement by the
                  Purchase Contract Agent do not conflict with or constitute a
                  breach of the charter or by-laws of the Purchase Contract
                  Agent.

                       (iv) No consent, approval or authorization of, or
                  registration with or notice to, any New York State or
                  federal governmental authority or agency is required, in
                  each case having jurisdiction over the trust activities of
                  the Purchase Contract Agent, for the execution, delivery or
                  performance by the Purchase Contract Agent of the Purchase
                  Contract Agreement and the Pledge Agreement.

                  (h) Counsel to the Collateral Agent shall have furnished to
the Remarketing Agent its written opinion, as counsel to the Collateral Agent,
and addressed to the Remarketing Agent and dated the Remarketing Settlement
Date, in form and substance satisfactory to the Remarketing Agent, to the effect
that:

                       (i) The Collateral Agent is duly incorporated and is
                  validly existing as a banking corporation in good standing
                  under the laws of the jurisdiction of incorporation with all
                  necessary corporate power and authority to execute, deliver
                  and perform its obligations under the Pledge Agreement.

                       (ii) The execution, delivery and performance by the
                  Collateral Agent of the Pledge Agreement in its capacity as
                  Collateral Agent have been duly authorized by all necessary
                  corporate action on the part of the Collateral Agent. The
                  Pledge Agreement has been duly executed and delivered by the
                  Collateral Agent and constitutes the valid and binding
                  agreement of the Collateral Agent, enforceable against the
                  Collateral Agent in accordance with its terms, except as the
                  enforcement thereof may be limited by the Bankruptcy
                  Exception and an implied covenant of good faith and fair
                  dealing.

                       (iii) The execution, delivery and performance of the
                  Pledge Agreement by the Collateral Agent in its capacity as
                  Collateral do not conflict with or constitute a breach of
                  the charter or by-laws of the Collateral Agent.

<PAGE>

                                                                              14

                       (iv) No consent, approval or authorization of, or
                  registration with or notice to, any New York State or
                  Federal governmental authority or agency, in each case
                  having jurisdiction over the trust activities of the
                  Collateral Agent, is required for the execution, delivery or
                  performance by the Collateral Agent of the Pledge Agreement.

                  (i) On the Remarketing Date, the Company shall have furnished
to the Remarketing Agent a letter addressed to the Remarketing Agent and dated
such date, in form and substance satisfactory to the Remarketing Agent, of Ernst
& Young LLP, or such other firm of nationally recognized independent public
accountants satisfactory to the Remarketing Agent, containing statements and
information of the type ordinarily included in accountants' "comfort letters"
with respect to certain financial information contained in the Prospectus and in
the Remarketing Materials.

                  (j) The Company shall have furnished to the Remarketing Agent
a certificate, dated the Remarketing Date, of (A) the Company's Chief Executive
Officer, President or Executive Vice President and (B) its Chief Financial
Officer, stating that:

                       (i) The representations, warranties and agreements of
                  the Company in Section 2 are true and correct as of the
                  Remarketing Date; the Company has complied with all its
                  agreements contained herein; and the conditions contained in
                  Section 5(a) have been fulfilled;

                       (ii) (A) Except as disclosed in the Prospectus or in
                  the Remarketing Materials and for any such losses or
                  interferences as would not result, individually or in the
                  aggregate, in a Material Adverse Effect, the Company and the
                  subsidiaries have not sustained since the date of the latest
                  audited financial statements included or incorporated by
                  reference in the Prospectus or in the Remarketing Materials
                  any material loss or interference with their respective
                  businesses or properties from fire, flood, hurricane,
                  accident or other calamity, whether or not covered by
                  insurance, or from any labor dispute or any legal or
                  governmental proceeding and (B) since the respective dates
                  as of which information is given in the Prospectus or in the
                  Remarketing Materials, there has not been any material
                  adverse change in the capital stock or ordinary shares of
                  the Company or any of the Subsidiaries or any change, or any
                  development involving a prospective change, in the business,
                  prospects properties, operations, condition (financial or
                  otherwise) or results of operations of the Company and its
                  subsidiaries taken as a whole, except in each case as
                  described or contemplated in the Prospectus or the
                  Remarketing Materials; and

                       (iii) They have carefully examined the Registration
                  Statement, the Prospectus and the Remarketing Materials and,
                  in their opinion (A) the Registration Statement, as of its
                  Effective Date, and the Prospectus and the Remarketing
                  Materials, as of their respective dates, did not include any
                  untrue statement of a material fact and did not omit to
                  state any material fact required to be stated therein or
                  necessary to make the statements therein not misleading, and
                  (B) since such dates, no event has occurred which should
                  have been set forth in a


<PAGE>

                                                                              15

                  supplement or amendment to the Registration Statement, the
                  Prospectus or the Remarketing Materials.

                  (k) There shall not have been, since the respective dates as
of which information is given in the final Prospectus, any material adverse
change in the condition, financial or otherwise, or in the consolidated
financial position, shareholders' equity, results of operations, business or
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business.

                  (l) Without the prior written consent of the Remarketing
Agent, the Certificate of Designations or the Purchase Contract Agreement shall
not have been amended in any manner, or otherwise contain any provision not
contained therein as of the date hereof that, in the opinion of the Remarketing
Agent, materially changes the nature of the Remarketed Convertible Preferred
Shares or the Remarketing Procedures.

                  (m) Subsequent to the execution and delivery of this
Agreement, (i) no downgrading shall have occurred in the rating accorded the
Convertible Preferred Shares and (ii) none of the Company's Insurance
Subsidiaries shall have been downgraded by any of the Rating Agencies nor have
been put on credit watch with negative implications (or similar action) by any
of the Rating Agencies.

                  (n) At the time of or subsequent to the Commencement Date,
there shall not have occurred any of the following: (i) any domestic or
international event or act or occurrence has materially disrupted, or in the
Remarketing Agent's opinion will in the immediate future materially disrupt, the
market for the Company's securities or securities in general; (ii) if trading on
the New York Stock Exchange (the "NYSE"), the Nasdaq National Market (the
"Nasdaq") or the American Stock Exchange shall have been suspended or been made
subject to material limitation, or minimum or maximum prices for trading shall
have been fixed, or maximum ranges for prices for securities shall have been
required, on the NYSE, the Nasdaq or the American Stock Exchange by the NYSE,
the Nasdaq or the American Stock Exchange or by order of the Commission or any
other governmental authority having jurisdiction; (iii) if a banking moratorium
has been declared by any state or federal authority or if any material
disruption in commercial banking or securities settlement or clearance services
shall have occurred; (iv) any downgrading shall have occurred in the Company's
corporate credit rating or the rating accorded the Company's debt securities or
preferred shares by any "nationally recognized statistical rating organization"
as that term is defined by the Commission for purposes of Rule 436(g)(2) under
the Securities Act or if any such organization shall have publicly announced
that it has under surveillance or review, with possible negative implications,
its rating of any of the Company's debt securities or preferred shares; or (v)
(A) if there shall have occurred any outbreak or escalation of hostilities or
acts of terrorism involving the United States or there is a declaration of a
national emergency or war by the United States or (B) if there shall have been
any other calamity or crisis or any change in political, financial or economic
conditions if the effect of any such event in (i) or (v) in the Remarketing
Agent's judgment makes it impracticable or inadvisable to proceed with the
Remarketing on the terms and in the manner contemplated in the Prospectus or in
the Remarketing Materials.


<PAGE>

                                                                              16

                  All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Remarketing Agent.

                  Section 6. Indemnification and Contribution. (a) The Company
shall indemnify and hold harmless the Remarketing Agent and each person, if any,
who controls the Remarketing Agent within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, against any and all losses,
liabilities, claims, damages and expenses whatsoever as incurred (including but
not limited to reasonable attorneys' fees and any and all expenses whatsoever
incurred in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever, and any and all amounts paid
in settlement of any claim or litigation), joint or several, to which they or
any of them may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, liabilities, claims, damages or expenses (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement or any amendment thereof, or any related Preliminary Prospectus or any
Prospectus, or in any supplement thereto or amendment thereof, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
(i) in the case of the Registration Statement, not misleading, and (ii) in the
case of the Prospectus or any related Preliminary Prospectus in light of the
circumstances under which they were made, not misleading; provided, however,
that the Company will not be liable in any such case to the extent but only to
the extent that any such loss, liability, claim, damage or expense arises out of
or is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of the
Remarketing Agent expressly for use therein. The parties agree that such
information provided by or on behalf of the Remarketing Agent consists solely of
paragraphs 3, 12 and 13 under the caption "Underwriting" in the prospectus filed
with the Commission by the Company pursuant to Rule 424(b) on December 10, 2003,
or the analogous paragraphs in any later prospectus or prospectus supplement
relating to the Convertible Preferred Shares; provided, further, that the
foregoing indemnity agreement with respect to any Preliminary Prospectus shall
not inure to the benefit of the Remarketing Agent or any person controlling the
Remarketing Agent who failed to deliver a Prospectus (as then amended or
supplemented, provided by the Company to the Remarketing Agent in the requisite
quantity and on a timely basis in compliance with Section 4(c)) to the person
asserting any losses, claims, damages and liabilities and judgments caused by
any untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they are
made, not misleading, if such material misstatement or omission or alleged
material misstatement or omission was cured, as determined by a court of
competent jurisdiction in a decision not subject to further appeal, in such
Prospectus and such Prospectus was required by law to be delivered at or prior
to the written confirmation of sale to such person. This indemnity agreement
will be in addition to any liability which the Company may otherwise have,
including but not limited to other liability under this Agreement.

                  (b) The Remarketing Agent shall indemnify and hold harmless
the Company, each of the directors of the Company, each of the officers of the
Company who shall have signed the Registration Statement, and each other person,
if any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, against any

<PAGE>

                                                                              17

losses, liabilities, claims, damages and expenses whatsoever as incurred
(including but not limited to reasonable attorneys' fees and any and all
expenses whatsoever incurred in investigating, preparing or defending against
any litigation, commenced or threatened, or any claim whatsoever, and any and
all amounts paid in settlement of any claim or litigation), joint or several, to
which they or any of them may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages
or expenses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, or any related Preliminary
Prospectus or the Prospectus, or in any amendment thereof or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein (i) in the case of the Registration Statement, not
misleading, and (ii) in the case of the Prospectus or any related Preliminary
Prospectus in light of the circumstances under which they were made, not
misleading, in each case to the extent, but only to the extent, that any such
loss, liability, claim, damage or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of the Remarketing Agent
specifically for use therein; provided, however, that in no case shall the
Remarketing Agent be liable or responsible for any amount in excess of the fee
paid to the Remarketing Agent pursuant to Section 3(a). The parties agree that
such information provided by or on behalf of the Remarketing Agent consists
solely of the material described in a letter from the Remarketing Agent to the
Company. This indemnity will be in addition to any liability which the
Remarketing Agent may otherwise have, including but not limited to other
liability under this Agreement.

                  (c) Promptly after receipt by an indemnified party under this
Section 6 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 6, notify each party against whom
indemnification is to be sought in writing of the claim or the commencement
thereof (but the failure so to notify an indemnifying party shall not relieve
the indemnifying party from any liability which it may have under this Section 5
to the extent that it is not materially prejudiced as a result thereof and in
any event shall not relieve it from any liability that such indemnifying party
may have otherwise than on account of the indemnity agreement hereunder). In
case any such claim or action is brought against any indemnified party, and it
notifies an indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate, at its own expense in the defense of such
action, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, that counsel to the
indemnifying party shall not (except with the written consent of the indemnified
party) also be counsel to the indemnified party. Notwithstanding the foregoing,
the indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by one of the indemnifying
parties in connection with the defense of such action, (ii) the indemnifying
parties shall not have employed counsel to have charge of the defense of such
action within a reasonable time after notice of commencement of the action,
(iii) the indemnifying party does not diligently defend the action

<PAGE>

                                                                              18

after assumption of the defense, or (iv) such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to one or all of the
indemnifying parties (in which case the indemnifying parties shall not have the
right to direct the defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses shall be borne by the
indemnifying parties. No indemnifying party shall, without the prior written
consent of the indemnified parties, effect any settlement or compromise of, or
consent to the entry of judgment with respect to, any pending or threatened
claim, investigation, action or proceeding in respect of which indemnity or
contribution may be or could have been sought by an indemnified party under this
Section 6 (whether or not the indemnified party is an actual or potential party
thereto), unless (x) such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such claim, investigation, action or proceeding and (ii) does not include a
statement as to or an admission of fault, culpability or any failure to act, by
or on behalf of the indemnified party, and (y) the indemnifying party confirms
in writing its indemnification obligations hereunder with respect to such
settlement, compromise or judgment.

                  (d) In order to provide for contribution in circumstances in
which the indemnification provided for in Section 6(a) or (b) is for any reason
held to be unavailable from any indemnifying party or is insufficient to hold
harmless a party indemnified thereunder, the Company and the Remarketing Agent
shall contribute to the aggregate losses, claims, damages, liabilities and
expenses of the nature contemplated by such indemnification provision (including
any investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company, any contribution received by
the Company from persons, other than the Remarketing Agent, who may also be
liable for contribution, including persons who control the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
officers of the Company who signed the Registration Statement and directors of
the Company) as incurred to which the Company and the Remarketing Agent may be
subject, in such proportions as are appropriate to reflect the relative benefits
received by the Company and the Remarketing Agent from the Remarketing or, if
such allocation is not permitted by applicable law, in such proportions as are
appropriate to reflect not only the relative benefits referred to above but also
the relative fault of the Company and the Remarketing Agent in connection with
the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Remarketing Agent shall be
deemed to be in the same proportion as (x) the total liquidation preference of
the Remarketed Convertible Preferred Shares less the fee paid to the Remarketing
Agent pursuant to Section 3(a) of this Agreement bears to (y) the fee paid to
the Remarketing Agent pursuant to such Section 3(a). The relative fault of each
of the Company and of the Remarketing Agent shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Remarketing Agent and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Remarketing Agent agree
that it would not be just and equitable if contribution pursuant to this Section
6(d) were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable

<PAGE>

                                                                              19

considerations referred to above in this Section 6(d). The aggregate amount of
losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 6(d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any judicial, regulatory or other legal or
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 6(d), (i) no
Remarketing Agent shall be required to contribute any amount in excess of the
amount by which the fees received by it under Section 3 exceeds the amount of
any damages which the Remarketing Agent has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission and (ii) no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 6(d), each person, if any, who
controls the Remarketing Agent within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as such Remarketing Agent, and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, each officer of the Company who shall have signed the
Registration Statement and each director of the Company shall have the same
rights to contribution as the Company, subject in each case to clauses (i) and
(ii) of the immediately preceding sentence. Any party entitled to contribution
will, promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties, notify each party or parties from whom
contribution may be sought, but the omission to so notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from
any obligation it or they may have under this Section 6(d) or otherwise.

                  Section 7. Resignation and Removal of the Remarketing Agent.
The Remarketing Agent may resign and be discharged from its duties and
obligations hereunder, and the Company may remove the Remarketing Agent, by
giving 60 days' prior written notice, in the case of a resignation, to the
Company and the Depositary and, in the case of a removal, the removed
Remarketing Agent and the Depositary; provided, however, that (i) the Company
may not remove the Remarketing Agent unless (A) the Remarketing Agent becomes
involved as a debtor in a bankruptcy, insolvency or similar proceeding, (B) the
Remarketing Agent shall not be among the 15 underwriters with the largest volume
underwritten in dollars, on a lead or co-managed basis, of U.S. domestic debt
securities during the twelve-month period ended as of the last calendar quarter
preceding the Remarketing Date or (C) the Remarketing Agent shall be subject to
one or more legal restrictions preventing the performance of its obligations
hereunder and (ii) no such resignation nor any such removal shall become
effective until the Company shall have appointed at least one nationally
recognized broker-dealer as successor Remarketing Agent and such successor
Remarketing Agent shall have entered into a remarketing agreement with the
Company in which it shall have agreed to conduct the Remarketing in accordance
with the Remarketing Procedures. In any such case, the Company will use its
reasonable efforts to appoint a successor Remarketing Agent and enter into such
a remarketing agreement with such person as soon as reasonably practicable. The
provisions of Sections 3 and 6 shall survive the resignation or removal of any
Remarketing Agent pursuant to this Agreement.

<PAGE>

                                                                              20

                  Section 8. Dealing in the Remarketed Convertible Preferred
Shares. The Remarketing Agent, when acting as a Remarketing Agent or in its
individual or any other capacity, may, to the extent permitted by law, buy,
sell, hold and deal in any shares of the Remarketed Convertible Preferred
Shares. The Remarketing Agent may exercise any vote or join in any action which
any beneficial owner of shares of Remarketed Convertible Preferred Shares may be
entitled to exercise or take pursuant to the Certificate of Designations with
like effect as if it did not act in any capacity hereunder. The Remarketing
Agent, in its individual capacity, either as principal or agent, may also engage
in or have an interest in any financial or other transaction with the Company as
freely as if it did not act in any capacity hereunder.

                  Section 9. Remarketing Agent's Performance; Duty of Care. The
duties and obligations of the Remarketing Agent shall be determined solely by
the express provisions of this Agreement, the Certificate of Designations and
the Purchase Contract Agreement. No implied covenants or obligations of or
against the Remarketing Agent shall be read into this Agreement, the Certificate
of Designations or the Purchase Contract Agreement. In the absence of bad faith
on the part of the Remarketing Agent, the Remarketing Agent may conclusively
rely upon any document furnished to it, which purports to conform to the
requirements of this Agreement, the Certificate of Designations or the Purchase
Contract Agreement as to the truth of the statements expressed in any of such
documents. The Remarketing Agent shall be protected in acting upon any document
or communication reasonably believed by it to have been signed, presented or
made by the proper party or parties. The Remarketing Agent, acting under this
Agreement, shall incur no liability to the Company or to any holder of
Remarketed Convertible Preferred Shares in its individual capacity or as
Remarketing Agent for any action or failure to act, on its part in connection
with a Remarketing or otherwise, except if such liability is judicially
determined to have resulted from the gross negligence or willful misconduct on
its part.

                  Section 10. Termination. This Agreement shall terminate as to
the Remarketing Agent on the effective date of the resignation or removal of the
Remarketing Agent pursuant to Section 7. In addition, the obligations of the
Remarketing Agent hereunder may be terminated by it by notice given to the
Company prior to 10:00 a.m., New York City time, on the Remarketing Date if,
after the Commencement Date and prior to that time, any of the events described
in Sections 5(k), (l), (m) or (n) shall have occurred. The provisions of
Sections 3 and 6 shall survive any such termination.

                  Section 11. Notices. All statements, requests, notices and
agreements hereunder shall be in writing, and:

                  (a) if to the Remarketing Agent, shall be mailed, delivered,
or faxed and confirmed in writing, to such Underwriter c/o Bear, Stearns & Co.
Inc., 383 Madison Avenue, New York, New York 10179, Attention: Jay Bullock,
Senior Managing Director, with a copy to Simpson Thacher & Bartlett LLP, 425
Lexington Avenue, New York, New York, 10017

                  (b) if to the Company, shall be mailed, delivered, or faxed
and confirmed in writing to the Company at P.O. Box HM 2939, Crown House, Third
Floor, 4 Par-la-Ville Road, Hamilton HM 08, Bermuda, Attention: Paul Goldean,
Esq., with a copy to LeBoeuf, Lamb, Greene & MacRae, L.L.P., 125 West 55th
Street, New York, New York, 10019, Attention: Stephen G. Rooney, Esq.


<PAGE>

                                                                              21

Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.

                  Section 12. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of and be binding upon the Remarketing
Agent, the Company and its successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(x) the representations, warranties, indemnities and agreements of the Company
contained in this Agreement shall also be deemed to be for the benefit of the
officers and employees of the Remarketing Agent and the person or persons, if
any, who control the Remarketing Agent within the meaning of Section 15 of the
Securities Act and (y) the indemnity agreement of the Remarketing Agent
contained in Section 6(b) of this Agreement shall be deemed to be for the
benefit of directors, officers and employees of the Company and any person
controlling the Company within the meaning of Section 15 of the Securities Act.
Nothing in this Agreement is intended or shall be construed to give any person,
other than the persons referred to herein, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision contained
herein.

                  Section 13. Submission to Jurisdiction and Service of Process.
(a) The Company irrevocably (i) submits to the jurisdiction of any court of the
State of New York in New York County or the United States District Court for the
Southern District of the State of New York for the purpose of any suit, action,
or other proceeding arising out of this Agreement, or any of the agreements or
transactions contemplated by this Agreement, the Registration Statement and the
Prospectus (each, a "Proceeding"), (ii) agrees that all claims in respect of any
Proceeding may be heard and determined in any such court, (iii) waives, to the
fullest extent permitted by law, any immunity from jurisdiction of any such
court or from any legal process therein, (iv) agrees not to commence any
Proceeding other than in such courts, and (v) waives, to the fullest extent
permitted by law, any claim that such Proceeding is brought in an inconvenient
forum.

                  (b) The Company agrees that service of all writs, process and
summonses in any suit, action or proceeding brought in connection with this
Agreement against the Company in any court of the State of New York or any
United States federal court, in each case, sitting in the Borough of Manhattan,
City and State of New York, may be made upon CT Corporation System at 111 Eighth
Avenue, New York, New York 10011, whom the Company irrevocably appoints as its
authorized agent for service of process. The Company represents and warrants
that CT Corporation System has agreed to act as the Company's agent for service
of process. The Company agrees that such appointment shall be irrevocable until
the irrevocable appointment by the Company of a successor in The City of New
York as its authorized agent for such purpose and the acceptance of such
appointment by such successor. The Company further agrees to take any and all
action, including the filing of any and all documents and instruments that may
be necessary to continue such appointment in full force and effect as aforesaid.
If CT Corporation System shall cease to act as the agent for service of process
for the Company, the Company shall appoint without delay, another such agent and
provide prompt written notice to Bear, Stearns & Co. Inc. of such appointment.

                  Section 14. Survival. The respective indemnities,
representations, warranties and agreements of the Company and the Remarketing
Agent contained in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall survive the Remarketing

<PAGE>

                                                                              22

and shall remain in full force and effect, regardless of any investigation made
by or on behalf of any of them or any person controlling any of them.

                  Section 15. Definition of the Terms "Business Day" and
"Subsidiary". For purposes of this Agreement, (a) "business day" means any day
on which the New York Stock Exchange, Inc. is open for trading and (b)
"subsidiary" has the meaning set forth in Rule 405 under the Securities Act.

                  Section 16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

                  Section 17. Counterparts. This Agreement may be executed in
one or more counterparts and, if executed in more than one counterpart, the
executed counterparts shall each be deemed to be an original but all such
counterparts shall together constitute one and the same instrument.

                  Section 18. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.



<PAGE>





                  If the foregoing correctly sets forth the agreement between
the Company and the Remarketing Agent, please indicate your acceptance in the
space provided for that purpose below.

                                       Very truly yours,

                                       SCOTTISH RE GROUP LIMITED, a Cayman
                                       Islands exempted company


                                       By:
                                           ----------------------------------
                                           Name:
                                           Title:


Accepted:

BEAR, STEARNS & CO. INC.



By:
    ----------------------------
    Authorized Representative