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                                 SPECIAL ENDORSEMENT
                                          TO
                      RETROCESSIONAL AGREEMENT NO. 8DDDR01-C122
                             (HEREINAFTER "ENDORSEMENT")




This Endorsement is made by and among AMERICAN RE-INSURANCE COMPANY, Princeton,
New Jersey (hereinafter "Reinsurer"), INTER-OCEAN REINSURANCE COMPANY LTD.,
Hamilton, Bermuda (hereinafter "Company"), and ZENITH INSURANCE COMPANY, CALFARM
INSURANCE COMPANY, ZNAT INSURANCE COMPANY and ZENITH STAR INSURANCE COMPANY,
(collectively hereinafter "Payee"). This Endorsement is part of and shall be
attached to Retrocessional Agreement No. 8DDDR01-C122 (hereinafter
"Retrocessional Agreement") and pertains to the Agreement identified below
(hereinafter "Agreement").

For value received, the Reinsurer, the Company and the Payee hereby agree that,
with respect to the Company's loss payment obligations arising under the
Agreement, which Agreement is reinsured in whole or in part by the Reinsurer
under the Retrocessional Agreement:

1.   In the event the Company is declared insolvent and placed in liquidation by
     a court of competent jurisdiction, and is therefore unable to pay any loss
     for which the Company would otherwise be legally liable under the
     Agreement, the Reinsurer shall become liable to pay amounts due to the
     Company under the Retrocessional Agreement directly to Zenith Insurance
     Company acting as agent to the Payee.

2.   The Reinsurer's obligation to make payments pursuant to this Endorsement
     shall be limited by the Company's liability under the terms, limits and
     conditions contained in the Agreement.

3.   Any payment by the Reinsurer pursuant to this Endorsement shall be, to the
     extent of such payment, in substitution, satisfaction and discharge of the
     Reinsurer's reinsurance obligation to the Company, its liquidators,
     receiver, or statutory successor under the Retrocessional Agreement. 
     Neither this Endorsement, nor any other provision of the Retrocessional
     Agreement or the Agreement, shall be construed in a manner which would
     subject the Reinsurer to liability for a duplicative payment of losses
     reinsured under the Retrocessional Agreement.

4.   In the event of a claim by the Payee against the Reinsurer pursuant to this
     Endorsement, the Reinsurer shall be entitled to all rights of the Company
     under the Agreement, including but not limited to salvage and subrogation
     rights and any rights the Company may have to collateral which secures
     obligations arising under the Agreement.

5.   In the event the Agreement is terminated or expires, or upon the cessation
     of all liability of the Company under the Agreement, this Endorsement shall
     simultaneously and automatically terminate.


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6.   The provisions of this Endorsement only shall apply with respect to the
     Agreement listed below:

     Aggregate Excess of Loss Reinsurance Agreement No.: 8DDD999-A122

     Agreement effective date: August 1, 1998

7.   Except as expressly herein stated, nothing herein contained shall vary,
     alter or amend the terms, conditions, or limitation of the Retrocessional
     Agreement endorsed hereby.

8.   There shall be no modification of, or change in, the terms of this
     Endorsement without the prior written approval of the parties to this
     Endorsement.




IN WITNESS WHEREOF the authorized parties hereto have executed this Endorsement
in triplicate to be effective on this 1st day of August, 1998.


AMERICAN RE-INSURANCE                   INTER-OCEAN REINSURANCE
COMPANY                                 COMPANY LTD.



/s/ Dominic Addesso                     /s/ Michael Sullivan
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ZENITH INSURANCE COMPANY,
CALFARM INSURANCE COMPANY,
ZNAT INSURANCE COMPANY and
ZENITH STAR INSURANCE COMPANY




/s/ John J. Tickner
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