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                                                                  Exhibit 10.31



                                                                     96/1146/RM



TITLE:            MEDICAL PRACTITIONERS' LIABILITY
                  PRIMARY EXCESS OF LOSS REINSURANCE CONTRACT

BETWEEN:          INTERMED INSURANCE COMPANY
                  AND
                  THE REINSURERS SIGNATORY HERETO

COMMENCING:       1ST OCTOBER, 1996

U.S. CLASS-
IFICATION:        U.S. REINSURANCE


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INDEX OF ARTICLES
<TABLE>
<S>         <C>
PREAMBLE    IDENTITY OF PARTIES
ARTICLE 1   BUSINESS REINSURED
ARTICLE 2   COVER, LIMIT AND RETENTION
ARTICLE 3   DEFINITIONS
ARTICLE 4   TERRITORIAL SCOPE
ARTICLE 5   EXCLUSIONS
ARTICLE 6   NET RETAINED LINES
ARTICLE 7   ULTIMATE NET LOSS
ARTICLE 8   EXCESS OF ORIGINAL POLICY LIMITS
ARTICLE 9   EXTRA-CONTRACTUAL OBLIGATIONS
ARTICLE 1   0PREMIUM
ARTICLE 11  PERIOD
ARTICLE 12  LOSS REPORTS AND PAYMENTS
ARTICLE 13  CURRENCY
ARTICLE 14  ACCESS TO RECORDS AND CLAIMS REVIEW
ARTICLE 15  COMMUTATION
ARTICLE 16  LOSS RESERVES
ARTICLE 17  TAX PROVISIONS
ARTICLE 18  DELAYS, ERRORS OR OMISSIONS
ARTICLE 19  INSOLVENCY OF THE REASSURED
ARTICLE 20  AMENDMENTS AND ALTERATIONS
ARTICLE 21  ARBITRATION
ARTICLE 22  SERVICE OF SUIT (NMA 1998)
ARTICLE 23  INTERMEDIARY
ARTICLE 24  PARTICIPATION
ATTACHMENTS    NUCLEAR INCIDENT EXCLUSION CLAUSE - LIABILITY
               REINSURANCE- U.S.A.
</TABLE>

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                                                                  Exhibit 10.31

                                                                     96/1146/RM

                        MEDICAL PRACTITIONERS' LIABILITY
                             PRIMARY EXCESS OF LOSS
                              REINSURANCE CONTRACT

PREAMBLE

This Contract is made and entered into between Intermed Insurance Company of
1903 E. Battlefield, Springfield, Missouri, U.S.A. (NAIC Code 33367)
(hereinafter referred to as the "Reassured") and the Reinsurers signatory
hereto (hereinafter referred to as the "Reinsurers"), on the following terms
and conditions:

                                   ARTICLE 1

BUSINESS REINSURED

For and in consideration of the premium being paid by the Reassured in
accordance with ARTICLE 1Q, PREMIUM, the Reinsurers agree to indemnify the
Reassured in respect of the net excess liability incurred by the Reassured
resulting from losses under Medical Practitioners' Liability policies
(including Dentists' Liability policies), including all other ancillary
coverages as original, issued by the Reassured, hereinafter referred to as
"policies."

                                   ARTICLE 2

COVER. LIMIT AND RETENTION

Section (A) below applies to each and every loss, each policy and/or insured.

Section (B) below applies to the sum of the Reassured's Section (A) retentions
in respect of two or more policies and/or insureds involved in the same loss
occurrence.

The Reinsurers shall accordingly be liable hereunder:

Section (A):

Whenever the Reassured has paid or advanced, or agreed to pay or advance, or
become liable to pay on account of a loss under any policy an amount in excess
of US$400,000 Ultimate Net Loss each and every loss, each policy and/or
insured, the amount recoverable from the Reinsurers hereunder shall be the
amount in excess of US$400,000 Ultimate Net Loss each and every loss, each
policy and/or insured, but such amount recoverable shall not exceed up to a
further US$1,600,000 Ultimate Net Loss each and every loss, each policy and/or
insured

and/or

Section (B):

Whenever two or more policies and/or insureds are involved in the same loss
occurrence the amount recoverable from the Reinsurers hereunder shall be the
amount in excess of US$400,000 Ultimate Net Loss each and every loss
occurrence, but such amount recoverable shall not exceed a further US$1,600,000
Ultimate Net Loss each and every loss occurrence.

Recoveries by the Reassured under Section (A) above shall inure to the benefit
of the Reinsurers under Section (B).



<PAGE>   4


It is agreed that the maximum overall recovery under this Contract shall be
300% of the maximum premium payable hereunder for the Contract Period, as
determined in ARTICLE 10, PREMIUM.

It is warranted that the Maximum Original Policy Limit for the purposes of this
Contract is US$1,000,000, or so deemed, except as respects awards in excess of
the Reassured's original policy limits and/or awards arising out of any
extra-contractual obligation, both as more fully defined in ARTICLES 8 and 9 of
this Contract, where coverage hereon applies to original policies issued
irrespective of limits.

It is agreed that although the original policies are issued by the Reassured on
an occurrence, claims made and claims paid basis, recoveries hereunder shall be
made on a claims made basis only.

It is further agreed that although original policies may contain aggregate
coverage, no aggregate coverage shall be provided by this Contract.

                                   ARTICLE 3

DEFINITIONS

A.   The term "Policy" or "Policies" as used in this Contract shall mean any
     binder, policy, endorsement, extended reporting endorsement or contract of
     insurance issued, accepted or held covered by the Reassured.

     For the purposes hereof, the original policy period shell be no greater
     than 12 months, plus odd time, not exceeding 18 months in all, except as
     respects extended reporting endorsements, which may be unlimited in
     period.

B.   The term "loss occurrence" as used in this Contract shall mean the
     happening of one or a series of related acts, errors, omissions,
     accidents, events or occurrences.

C.   For the purposes of this Contract the "claim made" date for any loss
     recoverable hereunder shall be deemed to be date of the receipt by the
     Reassured of acceptable notice from its original insured or a
     representative of its original insured that a claim is being or may be
     made against that original insured. The date of such receipt shall
     determine the date of loss for the purposes of this Contract.

     Furthermore, as regards extended reporting endorsements, the date a claim
     is made shall determine the date of loss for the purpose of this
     Contract.

     In the event that two or more policies and/or insureds are involved in
     the same loss occurrence and there is a difference in the dates claims are
     made during this Contract Period, or subsequent renewal thereof, the date
     on which the first claim is made shall establish the date of loss for all
     related claims arising out of the same loss occurrence. Notwithstanding
     the foregoing, in any loss occurrence, should any claim made date(s) fall
     prior to 1st October 1993, it is understood and agreed that those specific
     loss(es) shall be disregarded for the purposes of determining the
     Reassured's Ultimate Net Loss hereunder

D.   The term "Annual Period" as used in this Contract shall mean the period
     from 1st October, 1996 to 30th September, 1997, both dates inclusive, and
     each successive 12 month period thereof within this Contract Period.

E.   The term "Contract Period" as used in this Contract shall mean the period
     commencing at October 1st, 1996 and ending at September 30th, 1999 both
     dates inclusive, or any earlier date of termination as provided for in
     ARTICLE 11, PERIOD.

F.   The term "retention" as used in this Contract shall mean the amount
     retained by the Reassured in respect of each and every loss hereunder and
     which amount shall be retained net by the Reassured.


<PAGE>   5


                                   ARTICLE 4

TERRITORIAL SCOPE

This Contract shall cover wherever the Reassured's policies cover.

                                   ARTICLE 5

EXCLUSIONS

This Contract does not apply to and absolutely excludes the following:

1.   Nuclear Incidents, in accordance with the attached Nuclear Incident
     Exclusion Clause - Liability Reinsurance - U.S.A.

2.   All liability of the Reassured arising by contract, operation of law, or
     otherwise, from its participation or membership, whether voluntary or
     involuntary, in any Insolvency Fund. "Insolvency Fund" includes any
     Guaranty Fund, Insolvency Fund, Plan, Pool, Association, Fund or other
     arrangement, howsoever denominated, established or governed which provides
     for any assessment of or payment or assumption by the Reassured of part or
     all of any claim, debt, charge, fee or other obligation of an insurer, or
     its successors or assigns which has been declared by any competent
     authority to be insolvent or which is otherwise deemed unable to meet any
     claim, debt, charge, fee or other obligation in whole or in part.

3.   Reinsurance Assumed.

                                   ARTICLE 6

NET RETAINED LINES

Subject always to the provisions of ARTICLE 7. ULTIMATE NET LOSS. this Contract
applies only to that portion of any insurance covered by this Contract which
the Reassured retains net for its own account and in calculating the amount of
any loss hereunder and also in computing the amount or amounts in excess of
which this Contract attaches, only loss or losses in respect of that portion of
any insurance which the Reassured retains net for its own account shall be
included.

It is understood and agreed that the amount of the Reinsurers' liability
hereunder in respect of any loss or losses shall not be increased by reason of
the inability of the Reassured to collect from any other reinsurers, whether
specific or general, any amounts which may have become due from them, whether
such inability arises from the insolvency of such other reinsurers or
otherwise.

                                   ARTICLE 7

ULTIMATE NET LOSS

The term "Ultimate Net Loss" as used in this Contract shall mean the sum
actually paid or payable by the Reassured in settlement of any loss or losses
for which it is liable under its original policy or policies, and/or any
additional liability incurred by the Reassured as a result of an award in
excess of its original policy limits, and/or any additional liability incurred
by the Reassured from any extra-contractual obligation, both as more fully
defined in ARTICLES 8 and 9 of this Contract.

The amount of the Reassured's Ultimate Net Loss shall also include all loss
adjustment expenses incurred by the Reassured in connection with the
adjustment, settlement or compromise of any loss including





<PAGE>   6


expenses of litigation, if any, and all subrogation, salvage and recovery
expenses, but excluding the salaries of employees and all office expenses of
the Reassured.

All salvages and recoveries, including recoveries under all reinsurances which
inure to the benefit of this Contract, whether collected or not, shall first be
deducted from such loss to arrive at the amount of the Reassured's actual loss
for the purposes of this Contract.

All salvages, recoveries and payments recovered or received subsequent to a
loss settlement under this Contract shall be applied as if recovered or
received prior to the aforesaid settlement and all necessary adjustments shall
be made by the parties hereto. However, nothing in the foregoing shall be
construed as meaning that losses are not recoverable hereunder until the
Reassured's Ultimate Net Loss has been ascertained.

                                   ARTICLE 8

EXCESS OF ORIGINAL POLICY LIMITS

As provided in ARTICLE 7, ULTIMATE NET LOSS, this Contract shall protect the
Reassured, within the limits of this Contract, in respect of any additional
liability incurred by the Reassured as the result of an award in excess of
their original policy limit as more fully defined below. The Reinsurers agree
that the additional liability so incurred, plus the Reassured's contractual
loss, shall be considered as one combined loss for the purposes of the
Reassured's retention and of the recovery under this Contract subject always,
however, to the amount recoverable hereunder not exceeding the limit of
recovery under this Contract as provided in ARTICLE 2, COVER. LIMIT AND
RETENTION.

Awards in excess of the Reassured's original policy limit are defined as losses
which the Reassured would have been contractually liable to pay, had it not
been for the limit of the original policy and where such losses in excess of
the original policy limit have been incurred because of failure by the
Reassured to settle within the original policy limit or by reason of alleged or
actual negligence, fraud or bad faith in rejecting an offer of settlement or in
the preparation of the defence or in the trial of any action against their
insured or in the preparation or prosecution of an appeal consequent upon such
action.

The claims made date for any such award in excess of the original policy limit
shall be deemed, in all circumstances, to be the same as the claims made date
of the original claim to which such award attaches.

However, this Article shall not apply where such awards in excess of original
policy limit have been incurred due to the fraud of a member of the Board of
Directors or a corporate officer of the Reassured acting individually or
collectively or in collusion with any individual or corporation or any other
organisation or party involved in the presentation, defence or settlement of
any claim.

                                   ARTICLE 9

EXTRA-CONTRACTUAL OBLIGATIONS

As provided in ARTICLE 7, ULTIMATE NET LOSS, this Contract shall protect the
Reassured, within the limits of this Contract, in respect of any liability
incurred by the Reassured as the result of an award in respect of any
extra-contractual obligation, as more fully defined below. The Reinsurers agree
that the liability so incurred, plus the Reassured's contractual loss if any,
shall be considered as one combined loss for the purposes of the Reassured's
retention and of the recovery under this Contract subject always, however, to
the amount recoverable hereunder not exceeding the limit of recovery under this
Contract as provided in ARTICLE 2, COVER. LIMIT AND RETENTION.

"Extra-contractual obligations" are defined as those liabilities of the
Reassured not covered under any other provision of this Contract and which
arise from the handling of any claim on business covered hereunder, such
liabilities arising because of, but not limited to, the following: failure by
the Reassured to settle within


<PAGE>   7



the policy limit, or by reason of alleged or actual negligence, fraud or bad
faith in rejecting an offer of settlement or in the preparation of the defence
or in the trial of any action against their insured or in the preparation or
prosecution of an appeal consequent upon such action.

The claims made date for any such extra-contractual obligation shall be deemed,
in all circumstances, to be the same as the claims made date of the original
claim to which such extra-contractual obligation attaches.

However, this Article shall not apply where such extra-contractual obligations
have been incurred due to the fraud of a member of the Board of Directors or a
corporate officer of the Reassured acting individually or collectively or in
collusion with any individual or corporation or any other organisation or party
involved in the presentation, defence or settlement of any claim.

                                   ARTICLE 10

PREMIUM

A.   The Reassured shall pay to the Reinsurers for the Annual Period
     commencing 1st October, 1996, a Provisional Premium of US$1,000,000 in
     four equal instalments at 1st October 1st, 1996, 1st January, 1997, 1st
     April, 1997 and 1st July, 1997.

     The Provisional Premiums payable for subsequent Annual Periods shall be
     as mutually agreed.

B.   As soon as practicable after the close of each Annual Period, the
     Reassured shall render a statement of its cumulative Gross Net Earned
     Premium Income (as defined herein) and the Reassured shall pay or be paid
     by the Reinsurers as follows:

     1)    if the Contract is in effect for one year, the difference
           between the annual Provisional Premium and the Premium determined by
           applying a rate of 10.00% to the Gross Net Earned Premium Income. 12
           months after the expiry of the Contract Period a further premium
           adjustment shall be made by applying a rate of 110.00% to the
           cumulative Incurred Loss Cost and Expenses recoverable hereunder, to
           which shall be added a minimum rate of 4.50% of the Gross Net Earned
           Premium Income. In no event however shall the minimum rate plus
           110.00% of the cumulative Incurred Loss Cost and Expenses for the
           Contract Period exceed a maximum rate of 22.00%.

     2)    if the Contract is in effect for two years, the difference
           between the Provisional Premium for the two years and the premium
           determined by applying a rate of 10.00% to the cumulative Gross Net
           Earned Premium Income. 12 months after the expiry of the Contract
           Period a further premium adjustment shall be made by applying a rate
           of 110.00% to the cumulative Incurred Loss Cost and Expenses
           recoverable hereunder, to which shall be added a minimum rate of
           4.50% of the cumulative Gross Net Earned Premium Income. In no event
           however shall the minimum rate plus 110.00% of the cumulative
           Incurred Loss Cost and Expenses for the Contract Period exceed a
           maximum rate of 21.50%;


     3)    if the Contract is in effect for three years, the difference
           between the Provisional Premium for the three years and the premium
           determined by applying a rate of 10.00% to the cumulative Gross Net
           Earned Premium Income. 12 months after the expiry of the Contract
           Period a further premium adjustment shall be made by applying a rate
           of 110.00% to the cumulative Incurred Loss Cost and Expenses
           recoverable hereunder, to which shall be added a minimum rate of
           3.875% of the cumulative Gross Net Earned Premium Income. In no
           event however shall the minimum rate plus 110.00% of the cumulative
           Incurred Loss Cost and Expenses for the Contract Period exceed a
           maximum rate of 20.00%.


<PAGE>   8


C.   In the event of cancellation and non-renewal of this Contract, as defined
     in ARTICLE 11, PERIOD, the maximum rate for the last Annual Period hereon
     shall be automatically increased by a factor of 1.65, with the resulting
     Maximum premium for the Contract Period hereon to be calculated
     accordingly, as determined above.

     Further, in the event of cancellation and non-renewal of this Contract,
     any unearned premium applicable to policies in force at the effective date
     of cancellation and non-renewal, including any extended reporting
     endorsements attached thereto, shall be applied to the last Annual Period
     hereof, and the unearned premium shall be added to the Gross Net Earned
     Premium Income accruing to the last Annual Period of this Contract for the
     purposes of the rating formula.

D.   The premium determined for the Contract Period shall be re-calculated
     annually thereafter until all losses for the Contract Period are either
     settled, or commuted in accordance with ARTICLE 15, COMMUTATION.

E.   The term "Gross Net Earned Premium Income" shall, for all purposes of
     this Contract, be understood to mean the full gross earned amount of the
     premiums charged by the Reassured to its original insureds, for original
     policy limits up to US$1,000,000 or so deemed, less cancellations and
     return premiums and less premiums paid for reinsurances which inure to the
     benefit of this Contract, but including earned premium income for extended
     reporting endorsements.

F.   For the purpose of this article, the term "cumulative Incurred Loss Cost
     and Expenses" shall mean, on business the subject matter of this Contract,
     paid and outstanding losses and loss expenses recoverable under this
     Contract and all such incurred losses shall be charged to the Annual
     Period of this Contract to which the loss or losses fall for the purpose
     of determining the rate applicable to the Contract Period.

G.   It is agreed that in the event of commutation in accordance with ARTICLE
     15, COMMUTATION, the difference between the premium paid at that time and
     the premium adjustment due in consequence of such commutation shall be
     immediately payable.

                                   ARTICLE II

PERIOD

This Contract takes effect on 1st October, 1996 and applies to claims first
made on or alter that date as respects Medical Practitioners' Liability
(including Dentists' Liability), and all other ancillary coverages as in the
original policies.

This Contract shall remain in full force and effect until 30th September, 1999
but may be terminated at 30th September, 1997, or 30th September, 1998, by
either party giving to the other not less than 90 days written notice prior to
anniversary date.

In the event of the cancellation and non-renewal of this Contract, the
Reinsurers shall continue to be liable hereunder in respect of all claims first
made against the Reassured during an additional 60 months reporting period from
the effective date of cancellation and non-renewal. In respect of the
foregoing, the maximum rate for the last Annual Period hereon shall be
automatically increased by a factor of 1.65, with the resulting Maximum premium
for the Contract Period hereon to be calculated accordingly, as detailed in
ARTICLE 10, PREMIUM. The 60 months reporting period provisions provided above
shall not apply to claims first made on new or renewal policies incepting after
the effective date of cancellation and non-renewal of this Contract. Further,
in the event of cancellation and non-renewal of this Contract, all claims first
made against the Reassured during the additional 60 months reporting period
shall be applied to the last Annual Period hereof.



<PAGE>   9


The 60 months reporting period provisions provided above shall not be operative
if the Reassured replaces the reinsurance coverage afforded by this Contract,
whether in part or in full, or if the Reassured retains the limits provided
herein net and for its own account, whether in part or in full.

If any law or regulation of the Federal, State or Local Government of any
jurisdiction in which the Reassured is doing business shall render illegal the
arrangements made herein this Contract can be terminated immediately in so far
as it applies to such jurisdiction by the Reassured giving notice to the
Reinsurers to such effect.

                                   ARTICLE 12

LOSS REPORTS AND PAYMENTS

The Reinsurers agree to abide by all loss settlements of the Reassured,
provided such loss settlements are within the terms and conditions of the
Reassured's original policies and of this Contract, which at its sole
discretion shall adjust, settle or compromise all losses. All such adjustments,
settlements or compromises shall be unconditionally binding upon the
Reinsurers, who shall also benefit in due proportion from any salvages,
recoveries and compromises effected or negotiated by the Reassured.

The Reassured shall advise the Reinsurers by quarterly bordereaux of all paid
losses hereunder, and of outstanding losses including any subsequent
developments in connection therewith, which are reserved by the Reassured at,
or in excess of $400,000 Ultimate Net Loss.

Such bordereaux shall be furnished by the Reassured within 60 days following
the end of each quarter. The information contained therein shall be in brief
summary form but shall be sufficient to enable the individual losses, the
nature of each claim, the claim made date and the inception or renewal dates of
the policies to which such losses relate, to be readily identified.

The Bordereaux shall detail, for each individual loss:

1.   The amounts paid by the Reassured and the amounts outstanding in its own
     books for both indemnity and expenses, as at the end of the quarter under
     consideration. and the Reinsurers' share thereof.

2.   Indemnity and expense payments made by the Reassured during the quarter
     under consideration in respect of which reimbursement by the Reinsurers is
     then required.

The Reinsurers agree to pay any amount for which they may be liable under this
Contract as soon as possible after the quarterly bordereaux have been furnished
to them; but in the event of the Reassured sustaining a loss in respect of
which the Reinsurers' share amounts to or exceeds $200,000 Ultimate Net Loss,
the Reassured shall have the option of requiring the Reinsurers to effect
immediate payment outside of the quarterly bordereaux upon submission of proof
of loss.

                                   ARTICLE 13

CURRENCY

The currency to be used for all purposes of this Contract shall be United
States Dollars.

ARTICLE 14

ACCESS TO RECORDS AND CLAIMS REVIEW

All documents and records in the possession of the Reassured concerning this
Contract shall be made available upon reasonable notice at the request of the
Reinsurers for inspection at the Reassured's offices by


<PAGE>   10


the Reinsurers or their nominated representatives for the purposes of
obtaining information concerning this Contract or the subject matter hereof.

Specifically, the Reinsurers shall be entitled to nominate a representative to
assess the Reassured's claims and claims procedures.

For the avoidance of doubt, it is hereby expressly agreed that the rights given
to the Reinsurers by this Article shall continue in effect notwithstanding the
expiration of this Contract and shall be exercised at the Reinsurers' own
expense.

                                   ARTICLE 15

COMMUTATION

The Reassured at its option may, 12 months after the expiry of the Contract
Period or at any time thereafter, commute all losses outstanding to this
Contract.

The Reinsurers agree to accept the Reassured's discretionary reserves existing
at the time of commutation in consideration of which they will be relieved of
all further liability in respect of the Contract period both in respect of
known and unknown losses.

The option to commute may only be exercised by the Reassured provided that the
rate as determined in accordance with ARTICLE 10, PREMIUM, after commutation,
is less than the maximum rate stipulated in that Article and commutation shall
constitute a complete release of the Reinsurers from all further liability
under this Contract.

                                   ARTICLE 16

LOSS RESERVES

This Article applies only to those Reinsurers signatory hereto who do not
qualify for credit under the regulations of the State insurance authorities or
departments which have jurisdiction over the Reassured's loss reserves.

The Reassured agrees that when, for its Annual Convention Statement purposes,
it files with the authorities or departments mentioned above or sets up in its
bocks statutory reserves for known outstanding losses and allocated loss
expenses reinsured by this Contract it shall forward to the Reinsurers a clear
statement of the Reinsurers' proportion of those reserves detailing the amounts
involved for known outstanding losses and allocated loss expenses and also how
those amounts are calculated.

The Reinsurers, promptly upon receipt of the Reassured's statement, shall apply
for and secure delivery to the Reassured of a clean, irrevocable and
unconditional Letter of Credit, in an amount equal to their proportion of the
stated reserves. Under no circumstances shall any amount relating to reserves
in respect of losses or loss expenses Incurred But Not Reported be included in
the amount of the Letter of Credit.

All Letters of Credit procured pursuant to this Contract shall be issued by a
Bank which is a Member of the Federal Reserve and shall be in fall conformity
with the requirements of the authorities or departments mentioned in the first
paragraph of this Article current at the date of the Reassured's statement.
Further, they shall be "Evergreen" in that they shall be issued for an initial
period of not less than one year and shall be automatically extended for one
year from their original expiration dates and subsequently from their extended
expiration dates unless and until, at least thirty days before any expiration
date, the issuing bank gives notice to the Reassured by registered mail that
the issuing bank elects not to extend the life of the Letter of Credit in
question beyond its forthcoming expiration date.



<PAGE>   11



In consideration of the agreement of the Reinsurers to furnish such Letters of
Credit to the Reassured to enable it to obtain credit for the reinsurance
provided under this Contract, the Reassured hereby undertakes to hold such
Letters of Credit and the proceeds of any drawings made upon them in trust for
the Reinsurers and to use and apply the proceeds of any such drawings for the
following purposes only:

      a.   To pay the Reinsurers' share or to reimburse the Reassured
           for that share of any liability for loss or allocated loss expense
           reinsured by this Contract;

      b.   To refund to the Reinsurers any balance by which the amount
           of the Letter of Credit exceeds the Reinsurers' proportion of any
           liability for loss or allocated loss expense reinsured by this
           Contract.

      c.   In the event that one or more of the Reinsurers participating
           in the Letter of Credit gives timely notice of cancellation or
           non-renewal of their participation in the Letter of Credit and
           provided that the obligations secured by the Letter of Credit remain
           unliquidated and undischarged at the time of receipt by the
           Reassured of such notice, to create a cash deposit account, separate
           from its own assets, in an amount equal to the participation of the
           cancelling or non-renewing Reinsurer(s) in the Letter of Credit.
           That cash deposit account may then be used as in sub-paragraphs a
           and b above. It is understood and agreed that this procedure may
           only be implemented before the expiry of the notice period in
           respect of cancellation or non-renewal and that if it is
           implemented, the Reassured will ensure that a rate of interest is
           obtained for the Reinsurers on such a deposit account that is at
           least equal to the rate which would be paid by Citibank N.A. in New
           York, and further that the Reassured will account to the Reinsurers
           on an annual basis for all interest accruing on the cash deposit
           account for the benefit of the Reinsurers.

The issuing bank shall have no responsibility whatsoever in connection with the
propriety of drawings made by the Reassured on the Letters of Credit issued
under this Contract or in connection with the disposition of any funds so
withdrawn, except to ensure that drawings are made only upon the order of
properly authorised representatives of the Reassured.

All Letters of Credit procured for the Reassured under this Contract shall be
adjusted at annual intervals, or more frequently as agreed (but never more
frequently than quarterly), to reflect the current balance of the Reinsurers'
proportion of the Reassured's known outstanding loss and allocated loss expense
reserves and the Reassured shall produce a statement for this purpose detailed
in the same way as the original statement on the basis of which such Letters of
Credit were first issued. If the statement shows that the Reinsurers'
proportion of such losses and allocated expenses exceeds the current amount of
the Letters of Credit, the Reinsurers shall, within thirty days alter receipt
of the statement secure the amendment of the Letters of Credit increasing their
amount to the amount of the current balance of these items. If, however, the
statement shows that the Reinsurers' proportion of the current balance of those
items is less than the amount of the Letters of Credit the Reassured shall,
within thirty days of receipt of a written request from the Reinsurers to do
so, facilitate the release of the excessive security by authorising the
amendment of the Letters of Credit so as to reduce their amount to the current
balance required.

Under no circumstances shall any excessive security so determined be applied
towards securing the Reassured reserves for losses or loss expenses Incurred
But Not Reported.

All expenses incurred in the establishment or maintenance of such Letters of
Credit shall be for the account of the Reinsurers.


                                   ARTICLE 17

TAX PROVISIONS


<PAGE>   12





The Reassured shall be liable for all fazes (except Federal Excise Tax) levied
on premiums payable to the Reinsurers hereunder. Federal Excise Tax applies
only to those Reinsurers, excepting Underwriters at Lloyd's, London and other
Reinsurers exempt from the Federal Excise Tax, who are domiciled outside the
United States of America.

To the extent that such premium is subject to Federal Excise Tax, the
Reinsurers hereby agree to allow as a deduction from the premium, for the
purpose of paying Federal Excise Tax, 1% of the premium payable hereon.

In the event of any return premium becoming due hereunder the Reinsurers will
deduct 1% from the amount of the return, and the Reassured or their agents
shall take steps to recover the tax from the Government of the United States of
America.

Notwithstanding the above, any changes in the Federal Excise Tax rate or the
exemption status of Reinsurers shall be automatically applicable to this
Contract.

In consideration of the terms under which this Contract is issued, the
Reassured undertake not to claim any deduction in respect of premium payable
hereon when making tax returns, other than Income or Profits tax returns, to
any fiscal authority of the United States of America or any State or Territory
thereof.

                                   ARTICLE 18

DELAYS. ERRORS OR OMISSIONS

No inadvertent delay, error or omission shall be held to relieve either party
hereto of any liability which would have attached to them under this Contract
if such delay, error or omission had not been made, provided that rectification
is made immediately upon discovery.

INSOLVENCY OF THE REASSURED

Amounts due to the Reassured under this Contract shall be payable by the
Reinsurers on the basis of the liability of the Reassured under the original
policies reinsured hereunder without diminution because of the insolvency of
the Reassured.

In the event of the insolvency of the Reassured, the Liquidator or Receiver or
Statutory Successor of the Reassured shall give written notice to the
Reinsurers of the pendency of any claim against the insolvent Reassured on the
original policies reinsured hereunder within a reasonable time after such claim
is filed in the insolvency proceedings. During the pendency of such claim the
Reinsurers may investigate such claim and intervene, at their own expense, in
the proceedings where such claim is to be adjudicated and interpose any defense
or defenses which they may deem available to the Reassured or its Liquidator or
Receiver or Statutory Successor. The expense thus incurred by the Reinsurers
shall be chargeable, subject to court approval, against the insolvent Reassured
as part of the expense of liquidation to the extent of a proportionate share of
the benefit which may accrue to the Reassured solely as a result of the defence
so undertaken by the Reinsurers.

When two or more Reinsurers are involved in the same claim and a majority in
interest elect to investigate the claim and/or to interpose defence to such
claim, the expense shall be apportioned in accordance with the terms of the
above paragraph as though such expense had been incurred by the Reassured.

Should the Reassured go into liquidation or should a Receiver be appointed, the
Reinsurers shall be entitled to deduct from any sums which may be or may become
due to the Reassured under this Contract any sums which are due to the
Reinsurers from the Reassured under this Contract and which are expressed
herein to be payable at a fixed or stated date, as well as any other sums due
to the Reinsurers which are permitted to be offset under applicable law.



<PAGE>   13



In the event of the insolvency of the Reassured, the amounts due to the
Reassured under this Contract shall be payable by the Reinsurers directly to
the Reassured or to its Liquidator, Receiver or Statutory Successor.

                                   ARTICLE 20

AMENDMENTS AND ALTERATIONS

The terms herein contained comprise the whole Contract between the Reassured
and the Reinsurers and may only be changed in writing, signed by or on behalf
of both parties.

                                   ARTICLE 21

ARBITRATION

As a condition precedent to any right of action hereunder, all disputes or
differences arising out of or connected with this Contract (whether or not
arising before or after cancellation) including interpretation or
implementation of its terms, shall be referred to arbitration, in the City in
which the Reassured's principal office is located.

The party which desires to refer a matter to Arbitration ("the Claimant") shall
so notify the other party ("the Respondent") in writing and at the time of so
doing shall request the Respondent to agree as sole Arbitrator one of a list of
three individuals whom the Claimant shall name. The Respondent shall, within 30
days of receipt of the said notice, notify the Claimant either (a) that it
agrees one of those three individuals as sole Arbitrator, thus completing the
constitution of the Arbitral Tribunal, or (b) that it nominates another person
as its own Arbitrator.

In the event that the Respondent nominates its own Arbitrator, the Claimant
shall itself nominate its own Arbitrator within 30 days of receipt by it of the
Respondent's notice. The two Arbitrators so nominated shall, within 30 days of
the appointment of the second of them, themselves appoint a third Arbitrator to
complete the constitution of the Arbitral Tribunal.

Should the Respondent or the two chosen Arbitrators fail to make the
appointment required of them, then on application of the Claimant, the American
Arbitration Association will appoint the third arbitrator, and such appointment
will be made in accordance with the qualifications set forth in this Article
without regard to any of the American Arbitration Association's commercial
arbitration rules, including its rules concerning the qualifications and/or
nationality of arbitrators.

All Arbitrators shall be active or former disinterested officials of Insurance
or Reinsurance  Companies or Lloyd's Underwriters who have experience of the
class of business which is the subject matter of this Contract.

The Arbitral Tribunal shall interpret this Contract as if it were an honourable
engagement and not as merely a legal obligation; it is relieved of all judicial
formalities and may abstain from following the strict rules of law, and shall
make its award with a view to effecting the general purpose of this Contract in
a reasonable manner with due regard to the custom and usage of the insurance
and reinsurance business.

The Arbitral Tribunal shall have full discretion to make such orders as it
thinks fit in connection with all procedural matters in the Arbitration,
including but not limited to the conduct of the reference by written or oral
submissions, the production of documents, the examination of witnesses, and the
imposition of time limits for the taking of necessary procedural steps. The
Arbitral Tribunal shall also have full discretion to make such orders as it
thinks fit with regard to the payment of the costs of the Arbitration including
attorneys' costs and fees. Punitive damages shall not be awarded, however the
Arbitral Tribunal may, at its discretion, award such other costs and expenses
as it deems appropriate, including but not limited to attorneys' fees, to the
extent permitted by law.



<PAGE>   14



If more than one Reinsurer is involved in the same dispute, all such Reinsurers
shall constitute and act as one party for purposes of this clause, and
communications shall be made by the Reassured to each of the Reinsurers
constituting the one party, provided that nothing therein shall impair the
rights of such Reinsurers to assert several, rather than joint, defenses or
claims, nor be construed as changing the liability of the Reinsurers under the
terms of this Contract from several to joint.

Any Award or order of the Arbitral Tribunal or a majority thereof shall be
binding on the parties and there shall be no right of appeal therefrom. For the
purpose of enforcement of any Final Award, such Final Award may be made a Rule
of any Court of competent jurisdiction.


                                 ARTICLE 22

SERVICE OF SUIT (NMA 1998)

This Article applies only to those Reinsurers signatory hereto who are
domiciled outside the United States of America or, should the Reassured be
authorised to do business in the State of New York, those Reinsurers who are
unauthorised in New York as respects suits instituted in New York.

It is agreed that in the event of the failure of the Reinsurers hereon to pay
any amount claimed to be due hereunder, the Reinsurers hereon, at the request
of the Reassured, will submit to the jurisdiction of a Court of competent
jurisdiction within the United States. Nothing in this Article constitutes or
should be understood to constitute a waiver of the Reinsurers' rights to
commence an action in any Court of competent jurisdiction in the United States,
to remove an action to a United States District Court, or to seek a transfer of
a case to another Court as permitted by the laws of the United States or of any
State in the United States.

It is further agreed that service of process in such suit may be made upon
Mendes and Mount, 750 Seventh Avenue, New York, N.Y. 10019-6829, and that in
any suit instituted against any one of them upon this Contract, the Reinsurers
will abide by the final decision of such Court or of any Appellate Court in the
event of any appeal.

The above-named are authorised and directed to accept service of process on
behalf of the Reinsurers in any such suit and/or upon the request of the
Reassured to give a written undertaking to the Reassured that they will enter a
general appearance upon the Reinsurers' behalf in the event such a suit shall
be instituted.

Further, pursuant to any statute of any state, territory or district of the
United States which makes provision therefore, the Reinsurers hereon hereby
designate the Superintendent, Commissioner or Director of Insurance or other
officer specified for that purpose in the statute, or his successor or
successors in office, as their true and lawful attorney upon whom may be served
any lawful process in any action, suit or proceeding instituted by or on behalf
of the Reassured or any beneficiary hereunder arising out of this Contract of
Reinsurance, and hereby designate the above-named as the person to whom the
said officer is authorised to mail such process or a true copy thereof.

                                   ARTICLE 23

INTERMEDIARY

Carvill America Inc. of 180 North Stetson Avenue, Suite 5100, Chicago,
Illinois, U.S.A. is hereby recognised as the Intermediary negotiating this
Contract. All communications (including but not limited to notices, statements,
premiums, return premiums, commissions, taxes, losses, loss adjustment
expenses, salvages and loss settlements) relating thereto shall be transmitted
to the Reassured or the Reinsurers through Carvill America. Payments by the
Reassured to the Intermediary shall be deemed to constitute payment to the
Reinsurers. Payments by the Reinsurers to the Intemmediary shall be deemed to
constitute payment to the Reassured only to the extent that such payments are
actually received by the Reassured.



<PAGE>   15



                                   ARTICLE 24

PARTICIPATION

This Contract obligates each of the Reinsurers for their proportion of the
interests and liabilities set forth under this Contract, such proportions being
shown in the attached Schedules.

The subscribing reinsurers' obligations under contracts of reinsurance to which
they subscribe are several and not joint and are limited solely to the extent
of their individual subscriptions. The subscribing reinsurers are not
responsible for the subscription of any co-subscribing reinsurer who for any
reason does not satisfy all or part of its obligations. - Ref: LSW 1001
(Reinsurance).

IN WITNESS WHEREOF the parties hereto have, by their duly authorised
representative, executed this Contract as follows:


Signed in Springfield, Missouri, this       day of                 199


For and on behalf of the Reassured:
INTERMED  INSURANCE COMPANY



And for the Reinsurers by means of and in accordance with the attached
schedules which shall be considered to form an integral part of this Contract.




<PAGE>   16



                                   SCHEDULE B

                      Attaching to and forming part of the

                        MEDICAL PRACTITIONERS' LIABILITY
                  PRIMARY EXCESS OF LOSS REINSURANCE CONTRACT

                                effected between

                           INTERMED INSURANCE COMPANY
                            of Springfield, Missouri
                  (hereinafter referred to as the "Reassured")

                                      and

                          REINSURERS SIGNATORY HERETO
                 (hereinafter referred to as the "Reinsurers")

Signed in London, England this day of 199


The London Insurance and Reinsurance Market Association for and on behalf of
the following Reinsurers:

7.08%  SPHERE DRAKE (UNDERWRITING) LIMITED
       For and on behalf of:
       SPHERE DRAKE INSURANCE PLC
       Ref: 96MWDCA14284
       LIRMA Ref: S0289



NOW KNOW YE that We, the Reinsurers each of us to the extent of the
amount/percentage underwritten by us respectively, do hereby assume the burden
of the Reinsurance, and promise and bind ourselves, each for itself only and
not one for the other and in respect only of the due proportion of each of us.
to the Reinsured, their Executors, Administrators and Assigns, for the true
performance and fulfilment of this Contract.

IN WITNESS WHEREOF the Director of Policy Signing Services of LONDON INSURANCE
AND REINSURANCE MARKET ASSOCIATION ("LIRMA") has subscribed his name on behalf
of each of the LIRMA Companies and (where the Companies Collective Signing
Agreement ("CCSA") is being implemented) on behalf of the Leading CCSA Company
which is a LIRMA Member and authorised to sign this Contract (either itself or
by delegation to LIRMA) on behalf of all the other CCSA Companies.


Signed:
       -------------------------------------
       Director of Policy Signing Services


<PAGE>   17



U.S.A.

NUCLEAR INCIDENT EXCLUSION CLAUSE - LIABILITY - REINSURANCE


(1)  This reinsurance does not cover any loss or liability accruing to the
     Reassured as a member of, or subscriber to, any association of insurers or
     reinsurers formed for thc purpose of covering Nuclear Energy Risks or as a
     direct or indirect reinsurer of any such member, subscriber or
     association.

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

     Limited Exclusion Provision: *

     I.    It is agreed that the policy docs not apply under any
           liability coverage, (injury, sickness, disease, death or
           destruction, bodily injury, or property damage) with respect to
           which an insured under the policy is also an insured under a nuclear
           energy liability policy issued by Nuclear Energy Liability Insurance
           Association, Mutual Atomic Energy Liability Underwriters or Nuclear
           Insurance Association of Canada, or would bc an insured under any
           such policy but for its termination upon exhaustion of its limit of
           liability.

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

     III.  The inception dates and thereafter of all original policies
           as described in II above, whether new, renewal or replacement, being
           policies which either (a) become effective on or after 1st
           May, 1960, or (b) become effective before that date and contain the
           Limited Exclusion Provision set out above; provided
           this paragraph (2) shall not be applicable to Family Automobile
           Policies. Special Automobile Policies, or policies or combination
           policies of a similar nature. issued by the Reassured on New York
           risks. until 90 days following approval of the Limited Exclusion
           Provision by the Governmental Authority having jurisdiction thereof.

(3)  Except for those classes of policies specified in Clause II of paragraph
     (2) and without in any way restricting the operation of paragraph (1) of
     this Clause, it is understood and agreed that for all purposes of this
     reinsurance the original liability policies of the Reassured (new, renewal
     and replacement) affording the following coverages: Owners. Landlords and
     Tenants Liability. Contractual Liability, Elevator Liability. Owners or
     Contractors (including railroad) Protective Liability). Manufacturers and
     Contractors Liability, Product Liability, Professional and Malpractice
     Liability. Storekeepers Liability. Garage Liability. Automobile Liability
     (including Massachusetts Motor Vehicle or Garage Liability) shall be
     deemed to include. with respect to such coverages. from the time specified
     in Clause V of this paragraph (3), the following provision (specified as
     the Broad Exclusion Provision):


<PAGE>   18

Broad Exclusion Provision

      It is agreed that the Policy does not apply:

      I.   Under any Liability Coverage, to (injury, sickness, disease,
           death or destruction, bodily injury or property damage)
           (a)    with respect to which an insured under the
                  policy is also an insured under a nuclear energy liability
                  policy issued by Nuclear Energy Liability Insurance
                  Association, Mutual Atomic Energy Liability Underwriters or
                  Nuclear Insurance Association of Canada, or would be an
                  insured under any such policy but for its termination upon
                  exhaustion of its limit of liability; or
           (b)    resulting from the hazardous properties of
                  nuclear material and with respect to which (1) any person or
                  organization is required to maintain financial protection
                  pursuant to the Atomic Energy Act of l954, or any law
                  amendatory thereof, or (2) the insured is, or had this policy
                  not been issued would be, entitled to indemnity from the
                  United States of America, or any agency thereof, under any
                  agreement entered into by the United Stares of America, or
                  any agency thereof, with any person or organization.


      II.  Under any Medical Payments Coverage, or under any Supplementary
                  Payments (immediate medical  or
           Provision relating to surgical relief, to expenses incurred
                  with respect (first aid,
           to     (bodily injury, sickness, disease or death
                  bodily injury resulting from thc hazardous properties
                  of nuclear material and arising out of thc operation of a
                  nuclear facility by any person or organization.

      III.        (injury, sickness, disease, death or
           Under any Liability Coverage, to destruction
                  (bodily injury or property damage
           resulting from thc hazardous properties of nuclear material, if
           (a)  the nuclear material ( I ) is at any nuclear
                facility owned by, or operated by or on behalf of, an insured
                or (2) has been discharged or dispersed therefrom:
           (b)  the nuclear material is contained in spent fuel
                or waste at any time possessed, handled, used, processed,
                stored. transported or disposed of by or on behallf of an
                insured: or
           (c)  the (injury, sickness, disease, death or destruction
                  (bodily injury or property damage
           arises out of the furnishing by an insured of services, materials,
           parts or equipment in connection with the planning, construction,
           maintenance, operation or use of any nuclear facility, but if such
           facility is located within the United States of America. its
           territories, or possessions or Canada, this exclusion (c) applies
           only
           to     (injury to or destruction of property at such
           Nuclear facility.
                  (property damage to such nuclear facility and any property
                  thereat

      IV.  As used in this endorsement:
           "hazardous properties "include, radioactive, toxic or explosive
           properties; "nuclear  material" means source material special
           nuclear material or by-product material; "source material", "special
           nuclear material", and "by-product material" have the meanings given
           them in the Atomic Energy Act of 1954 or in any law amendatory
           thereof "spent fuel" means any fuel element or fuel component solid
           or liquid, which has been used or exposed to radiation in a nuclear
           reactor: "waste" means any waste material (1) containing by-product
           material other than tailings or wastes produced by the extraction or





<PAGE>   19

           concentration of uranium or thorium from any ore processed primarily
           for its source material content, and (2) resulting from the
           operation by any person or organization of any nuclear facility
           included under the first two paragraphs of the definition at nuclear
           facility; "nuclear facility" means
           (a) any nuclear reactor,
           (b) any equipment or device designed or used for (1) separating
               the isotopes of uranium or plutonium (2) processing or
               utilizing spent fuel, or (3) handling, processing or packaging
               waste,
           (c) any equipment or device designed or used for the processing,
               fabricating or alloying of special nuclear material if at any
               time the total amount of such material in the custody of the
               insured at the premises where such equipment or device is
               located consists of or contains more than 25 grams of plutonium
               or uranium 233 or any combination thereof, or more than 250
               grams of uranium 235.

           (d) Any structure, basin, excavation, premises or place prepared or
               used for the storage or disposal of waste.

      and includes the site on which any of the foregoing is located, all
      operations conducted on such site and all premises used for such
      operations:  "nuclear reactor" means any apparatus designed or used to
      sustain nuclear fission in a self-supporting chain reaction or to contain
      a critical mass of fissionable material;
           (With respect to injury to or destruction of property, the word
      "injury" or
           ("destruction"
           ("property damage" includes all forms of radioactive contamination
      of property.
           (includes all forms of radioactive contamination of property.
      V.   The inception dates and thereafter of all original policies
           affording coverages specified in this paragraph (3), whether new,
           renewal or replacement, being policies which become effective on or
           after 1st May, 1960, provided this paragraph (3) shall not be
           applicable to
                    (i)  Garage and Automobile Policies issued by the Reassured
                         on New York risks, or
                    (ii) Statutory liability insurance required under Chapter
                         90 General Laws of Massachusetts,
      Until 90 days following approval of the Broad Exclusion Provision by the
      Governmental Authority having jurisdiction thereof.

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



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