<PAGE>

                                                                  CONFORMED COPY



                   _________________________________________


                         FIRST SUPPLEMENTAL INDENTURE

                                     among

                              MUTUAL GROUP LTD.,
                                  as Issuer,

                         MUTUAL RISK MANAGEMENT LTD.,
                                 as Guarantor,

                                      and

                           THE CHASE MANHATTAN BANK,
                                  as Trustee

                        Dated as of September 21, 2000

                   _________________________________________
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                               TABLE OF CONTENTS

                                ---------------
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                                                                                                      ----

                                                 ARTICLE 1
                                                Definitions
<S>                                                                                                   <C>
Section 1.01.  Definitions of Terms.............................................................         2

                                                 ARTICLE 2
                             General Terms And Conditions Of The Senior Notes

Section 2.01.  Designation and Principal Amount.................................................         7
Section 2.02.  Maturity.........................................................................         7
Section 2.03.  Form and Payment; Minimum Transfer Restriction...................................         7
SECTION 2.04.  Exchange and Registration of Transfer of Securities;
         Restrictions on Transfers; Depository..................................................         8
Section 2.05.  Interest.........................................................................         12
Section 2.06.  Right to Proceed.................................................................         14
Section 2.07.  No Issuance upon the Exercise of Warrants........................................         14

                                                 ARTICLE 3
                                      Redemption Of The Senior Notes

Section 3.01.  Redemption.......................................................................         15
Section 3.02.  Optional Redemption by Company...................................................         15
Section 3.03.  No Sinking Fund..................................................................         15
Section 3.04.  Mandatory Redemption upon a Qualifying Offering..................................         15

                                                 ARTICLE 4
                                                  Expenses

Section 4.01.  Payment of Expenses..............................................................         16
Section 4.02.  Payment upon Resignation or Removal..............................................         16

                                                 ARTICLE 5
                                         Conversion Of Senior Notes

Section 5.01.  Conversion Rights................................................................         17
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                                                ARTICLE 6
                                          Form Of Senior Notes
<S>                                                                                                   <C>
Section 6.01.  Form of Senior Note..............................................................        17


                                                 ARTICLE 7
                                      Original Issue Of Senior Notes

Section 7.01.  Original Issue of Senior Notes...................................................        17

                                                 ARTICLE 8
                                          Remarketing; Reset Rate

Section 8.01.  Effectiveness of this Article; Incorporation of Remarketing
         Agreement..............................................................................        18
Section 8.02.  Determination of Reset Date; Remarketing.........................................        18
Section 8.03.  Reset of Interest Rate and Maturity Date.........................................        21
Section 8.04.  Renewed Remarketing..............................................................        21
Section 8.05.  Failed Remarketing...............................................................        21

                                                 ARTICLE 9
                                               Miscellaneous

Section 9.01.  Ratification of Base Indenture; First Supplemental
         Indenture Controls.....................................................................        22
Section 9.02.  Trustee Not Responsible for Recitals.............................................        22
Section 9.03.  Governing Law....................................................................        22
Section 9.04.  Severability.....................................................................        22
Section 9.05.  Counterparts.....................................................................        22
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                                           ii
<PAGE>

         FIRST SUPPLEMENTAL INDENTURE, dated as of September 21, 2000 (the
"First Supplemental Indenture") among Mutual Group Ltd., a Delaware corporation
(the "Company"), Mutual Risk Management Ltd., as Guarantor (the "Guarantor"),
and The Chase Manhattan Bank, a New York banking corporation, as trustee (the
"Trustee") under the Indenture dated as of September 21, 2000 among the Company,
the Guarantor and the Trustee (the "Base Indenture" and together with this First
Supplemental Indenture, the "Indenture").

         WHEREAS, the Company and the Guarantor executed and delivered the Base
Indenture to the Trustee to provide for the future issuance of the Company's
Securities to be issued from time to time in one or more series as might be
determined by the Company under the Indenture, in an unlimited aggregate
principal amount which may be authenticated and delivered as provided in the
Base Indenture;

         WHEREAS, Section 9.1 of the Base Indenture permits the terms of any
series of Securities to be established in an indenture supplemental to the Base
Indenture;

         WHEREAS, pursuant to the terms of the Base Indenture, the Company
desires to provide for the establishment of a new series of its Securities to be
known as its Auction Rate Reset Senior Notes Series A (the "Senior Notes"), the
form and substance of such Senior Notes and the terms, provisions and conditions
thereof to be set forth as provided in the Base Indenture and this First
Supplemental Indenture;

         WHEREAS, MRM Capital Trust I, a statutory business trust organized
under the laws of the State of Delaware (the "Trust"), has offered to Intrepid
Funding Master Trust $40,000,000 aggregate liquidation amount of its Auction
Rate Reset Preferred Securities (liquidation amount $1,000 per preferred
security) (the "Preferred Securities"), representing undivided beneficial
interests in the assets of the Trust, and proposes to invest the proceeds from
such offering, together with the proceeds of the issuance and sale by the Trust
to the Company of $1,240,000 aggregate liquidation amount of its Auction Rate
Reset Common Securities, in $41,240,000 aggregate principal amount of the Senior
Notes;

         WHEREAS, pursuant to the terms of the Remarketing and Contingent
Purchase Agreement dated as of September 21, 2000 (the "Remarketing Agreement")
among the Company, the Trust, the Guarantor and Banc of America Securities LLC,
as remarketing agent (the "Remarketing Agent"), the Preferred Securities or,
following any distribution of Senior Notes to the holders of Preferred
Securities, such Senior Notes, as the case may be, shall, on the
<PAGE>

occurrence of a Trigger Event, be remarketed in accordance with the terms hereof
by the Remarketing Agent on the Reset Date; and

         WHEREAS, the Company and the Guarantor requested that the Trustee
execute and deliver this First Supplemental Indenture, and all requirements
necessary to make this First Supplemental Indenture a valid instrument in
accordance with its terms, and to make the Senior Notes, when executed by the
Company and authenticated and delivered by the Trustee, and the Guarantees
endorsed thereon, when executed by the Guarantor, the legal, valid and binding
obligations of the Company and the Guarantor, as the case may be, have been
performed, and the execution and delivery of this First Supplemental Indenture
has been duly authorized in all respects.

         NOW THEREFORE, in consideration of the purchase and acceptance of the
Senior Notes by the Holder thereof, and for the purpose of setting forth, as
provided in the Indenture, the form and substance of the Senior Notes and the
Guarantees to be endorsed thereon and the terms, provisions and conditions
thereof, the Company and the Guarantor covenant and agree with the Trustee as
follows:


                                   ARTICLE 1
                                  DEFINITIONS

         SECTION 1.01. Definitions of Terms. Unless the context otherwise
requires:

          (a)  a term defined in the Base Indenture and not otherwise defined
herein has the same meaning when used in this First Supplemental Indenture;

          (b)  the singular includes the plural as well as vice versa;

          (c)  a reference to a Section or Article is to a Section or Article of
this First Supplemental Indenture;

          (d)  headings are for convenience of reference only and do not affect
interpretation; and

          (e)  the following terms have the meanings given to them in the Trust
Agreement:

                  Administrative Trustee


                                       2
<PAGE>

                  Affiliate
                  Associated Person
                  Closing Date
                  Closing Price
                  Common Securities
                  Common Shares
                  Cross Default
                  Delaware Trustee
                  Direct Action
                  Like Amount
                  Liquidation Amount
                  Majority in Liquidation Amount
                  Mandatory Redemption Date
                  Mandatory Redemption Price
                  Paying Agent Person
                  PORTAL Market
                  Preferred Securities
                  Pro Rata
                  Property Trustee
                  Purchase Agreement
                  Qualifying Offering
                  Reference Corporate Dealer
                  Remarketing Agent
                  Remarketing Fee
                  Replacement Securities
                  Rule 144A
                  Secondary Purchase Agreement
                  Securities Act
                  Special Event
                  Tax Event
                  Trading Day
                  Trigger Price

         (f) the following terms have the meanings given to them in this Section
1.01(f):

         "90 Day Period" has the meaning set forth in Section 3.01.

         "Additional Interest" means the interest, if any, that shall accrue on
any interest on the Senior Notes that is in arrears for more than one interest
payment period, which shall accrue at the stated rate per annum specified or
determined as specified in such Senior Note and compounded quarterly.

                                       3
<PAGE>

         "Additional Sums" has the meaning set forth in Section 2.05(f).

         "Additional Taxes" means the sum of any additional taxes, duties and
other governmental changes to which the Trust has become subject from time to
time as a result of a Tax Event.

         "Affiliated Bidder" has the meaning set forth in Section 8.02(b).

         "Bid" means an irrevocable offer to purchase the aggregate outstanding
principal amount of Senior Notes at the Remarketing Price with an Interest Rate
equal to the Bid Rate specified in such Bid and with a Maturity Date on the
Remarketed Maturity Date.

         "Bid Rate" means the proposed Interest Rate on the Senior Notes
specified in a Bid.

         "Business Day" means a day on which banking institutions in New York,
New York and Wilmington, Delaware are not authorized or required by law or
regulation to close and, until the Remarketing Settlement Date, that is also a
London Banking Day.

         "Calculation Agent" means Banc of America Securities LLC.

         "Date of Determination" has the meaning set forth in Section 2.05(b).

         "Dissolution Event" means that pursuant to Section 8.01 of the Trust
Agreement, the Trust is to be dissolved in accordance with the Trust Agreement,
and the Senior Notes held by the Property Trustee are to be distributed to the
holders of the Trust Securities issued by the Trust Pro Rata in accordance with
the Trust Agreement.

         "Expected Reset Date" has the meaning set forth in Section 8.02(a)(i).

         "Failed Remarketing" means any event specified as such, at the time so
specified in Article 8 hereof or in Article 6 of the Trust Agreement.

         "Final Reset Date" has the meaning set forth in Section 8.02(a)(iii).

         "Former Holders" has the meaning set forth in Section 8.02(i)(A).

         "Global Senior Note" has the meaning set forth in Section 2.04(a)(i).

                                       4
<PAGE>

         "Guarantee Trustee" means the Preferred Securities Guarantee Trustee as
defined in the Preferred Securities Guarantee Agreement dated as of September
21, 2000 among the Company, the Guarantor and The Chase Manhattan Bank, as
trustee for the benefit of holders from time to time of Preferred Securities.

         "Interest Payment Date" has the meaning set forth in Section 2.05(d).

         "Interest Rate" has the meaning set forth in Section 2.05(a).

         "LIBOR" means the rate determined by the Calculation Agent as the
interest rate expressed in decimal figures for deposits in the London interbank
market for a period of three months in U.S. Dollars which appears on the
Telerate Page 3750 as of 11:00 a.m., London time, on the Date of Determination.
If such rate does not appear on the Telerate Page 3750, the rate on the Date of
Determination will be determined as if the parties had specified the LIBOR-
Reference Banks Rate as the applicable rate.

         "LIBOR-Reference Banks Rate" means the rate determined on the basis of
the rates at which three-month deposits in U.S. Dollars in the Representative
Amount are offered at approximately 11:00 a.m., London time, on the Date of
Determination by the Reference Banks to prime banks in the London interbank
market for deposits commencing two London Banking Days following such Date of
Determination. The Calculation Agent will request the principal London office of
each of the Reference Banks to provide a quotation of its rate. If at least two
such quotations are provided, the rate will be the arithmetic mean of the
quotations. If fewer than two quotations are provided as requested, the rate
will be the arithmetic mean of the rates quoted at approximately 11:00 a.m., New
York City time, on the Date of Determination by major banks in New York City
(selected by the Calculation Agent) on the Date of Determination for three-month
loans in U.S. Dollars in the Representative Amount to leading banks for loans
extended two London Banking Days following such Date of Determination.

         "London Banking Day" means any day on which dealings in deposits in
U.S. Dollars are transacted in the London interbank market.

         "Maturity Date" means September 21, 2003; provided that in the event of
a successful Remarketing of the Senior Notes or the Preferred Securities, as the
case may be, the Maturity Date shall be the Remarketed Maturity Date.

         "Pre-Remarketing Interest Payment Date" has the meaning set forth in
Section 2.05(b).

                                       5
<PAGE>

         "Pre-Remarketing Regular Record Date" has the meaning set forth in
Section 2.05(c).

         "Redemption Date" shall mean, when used with respect to any Senior
Notes to be redeemed, the date fixed for such redemption by or pursuant to this
First Supplemental Indenture.

         "Redemption Price" has the meaning set forth in Section 3.01.

         "Reference Banks" means, for the purposes of any LIBOR rate, four major
banks in the London interbank market selected by the Calculation Agent.

         "Regular Record Date" has the meaning set forth in Section 2.05(e).

         "Remarketed Maturity Date" means the later of (i) the first anniversary
of the Remarketing Settlement Date on which Replacement Notes are issued, and
(ii) September 21, 2003.

         "Remarketing" means a remarketing of Senior Notes pursuant to Article 8
hereof or Article 6 of the Trust Agreement.

         "Remarketing Price" means 100.25 % of the aggregate principal amount of
the Senior Notes.

         "Remarketing Settlement Date" means the third Business Day immediately
following the Reset Date.

         "Renewed Remarketing" has the meaning set forth in Section 8.04.

         "Replacement Notes" has the meaning set forth in Section 8.02(j).

         "Replacement Securities" has the meaning set forth in Section 5(j) of
the Remarketing Agreement.

         "Representative Amount" means, for the purposes of any LIBOR rate for
which a Representative Amount is relevant, an amount that is equal to the
aggregate principal amount of all of the Senior Notes.

         "Reset Date" means any date established as a Reset Date pursuant to
Article 8 hereof or Article 6 of the Trust Agreement.

         "Reset Rate" has the meaning set forth in Section 1 of the Remarketing
Agreement.

                                       6
<PAGE>

         "Restricted Security" has the meaning set forth in Section 2.04(c).

         "Secondary Purchaser" has the meaning set forth in Section 8.02(c).

         "Transfer Restriction Termination Date" means the first date on which
the Senior Notes (other than Senior Notes acquired by the Company or any
Affiliate thereof) may be sold pursuant to Rule 144(k).

         "Trigger Event" has the meaning set forth in Section 8.02(a).

         "Trust Agreement" means the Amended and Restated Trust Agreement of MRM
Capital Trust I, a Delaware statutory business trust, dated as of September 21,
2000.

         "Trust Securities" means the Preferred Securities and Common Securities
of the Trust.

         "U.S. Dollar" or "$" means the lawful currency of the United States of
America.

         "Winning Bid Rate" has the meaning set forth in Section 8.02(b) hereof
or in Section 6.02(b) of the Trust Agreement.

                                   ARTICLE 2
               GENERAL TERMS AND CONDITIONS OF THE SENIOR NOTES

         SECTION 2.01. Designation and Principal Amount. There is hereby
authorized a series of Securities designated the "Auction Rate Reset Senior
Notes Series A", limited in aggregate principal amount to $41,240,000 (except as
contemplated in Section 3.1(b) of the Base Indenture).

         SECTION 2.02. Maturity. The principal of the Senior Notes shall be due
and payable on the Maturity Date.

         SECTION 2.03. Form and Payment; Minimum Transfer Restriction.

         (a) Except as provided in Section 2.04, the Senior Notes shall be
issued in fully registered certificated form without coupons in denominations of
$100,000 in principal amount and integral multiples of $1,000 in excess thereof.
Principal and interest on the Senior Notes issued in certificated form will be
payable by check or wire transfer, the transfer of such Senior Notes will be

7
<PAGE>

registrable and such Senior Notes will be exchangeable for Senior Notes bearing
identical terms and provisions, in each case, at the office or agency of the
Trustee in the Borough of Manhattan, the City of New York; provided that payment
of interest may be made at the option of the Company by check mailed to the
Holder at such address as shall appear in the Securities Register.
Notwithstanding the foregoing, so long as the Property Trustee is a holder of
Senior Notes, the payment of the principal of and interest (including any
Additional Interest, if any) on such Senior Notes held by the Property Trustee
will be made at such place and to such account as may be designated in writing
by the Property Trustee.

         (b) A holder of Senior Notes may transfer or exchange Senior Notes held
by it only in minimum denominations of $100,000 and integral multiples of $1,000
in excess thereof. Any attempted transfer, sale or other disposition of Senior
Notes in a denomination of less than $100,000 shall be deemed to be void and of
no legal effect whatsoever.

         SECTION 2.04. Exchange and Registration of Transfer of Securities;
Restrictions on Transfers; Depository. (a) If distributed to holders of
Preferred Securities in connection with a Dissolution Event, the Senior Notes
will be issued in the same form as the Preferred Securities that such Senior
Notes replace in accordance with the following procedures.

          (i) If the Preferred Securities are held in global form, the Senior
         Notes shall be presented to the Trustee by the Property Trustee in
         exchange for a Security in permanent global form in an aggregate
         principal amount equal to the aggregate principal amount of all
         outstanding Senior Notes (a "Global Senior Note"), to be registered in
         the name of the Depository, or its nominee, and delivered by the
         Property Trustee to the Depository for crediting to the accounts of its
         participants pursuant to the instructions of the Administrative
         Trustees. The Company upon any such presentation shall execute a Global
         Senior Note in such aggregate principal amount and deliver the same to
         the Trustee for authentication and delivery in accordance with the
         Indenture. Payments on the Senior Notes issued as a Global Senior Note
         will be made to the Depository. The Company initially appoints The
         Depository Trust Company to act as Depository with respect to the
         Global Senior Note, if issued.

         (ii) If the Preferred Securities are held in certificated form, the
         Senior Notes shall be presented to the Trustee by the Property Trustee
         and each outstanding Preferred Security certificate will be deemed to
         represent a beneficial interest in such Senior Note in an aggregate
         principal amount equal to the aggregate Liquidation Amount of the
         Preferred Securities represented by such Preferred Security
         certificate. When the holder of a

                                       8
<PAGE>

     Preferred Security certificate presents such certificate for transfer or
     reissuance, such certificate will be canceled and a Senior Note, registered
     in the name of such holder or such holder's transferee, as the case may be,
     in an aggregate principal amount equal to the aggregate Liquidation Amount
     of the canceled certificate, will be executed by the Company and delivered
     to the Trustee for authentication and delivery in accordance with the
     Indenture. On issue of such Senior Notes, Senior Notes with an equivalent
     aggregate principal amount that were presented by the Property Trustee to
     the Trustee will be deemed to have been canceled.

     (b)  Any Global Senior Note may be endorsed with or have incorporated in
the text thereof such legends or recitals or changes not inconsistent with the
provisions of this Indenture as may be required by the Depository, by a national
securities exchange or by the National Association of Securities Dealers, Inc.
in order for the Senior Notes to be tradeable on the PORTAL Market or as may be
required for the Senior Notes to be tradeable on any other market developed for
trading of securities pursuant to Rule 144A or required to comply with any
applicable law or any regulation thereunder or with the rules and regulations of
any securities exchange upon which the Senior Notes may be listed or traded or
to conform with any usage with respect thereto, or to indicate any special
limitations or restrictions to which any particular Senior Notes are subject.

     (c)  Each Senior Note that bears or is required to bear the legend set
forth in this Section 2.04(c) (a "Restricted Security") shall be subject to the
restrictions on transfer provided in the legend set forth in this Section
2.04(c), unless such restrictions on transfer shall be waived by the written
consent of the Company, and the Holder of each Restricted Security, by such
Holder's acceptance thereof, agrees to be bound by such restrictions on
transfer. As used in this Section 2.04(c) and in Section 2.04(d), the term
"transfer" encompasses any sale, pledge, transfer or other disposition of any
Restricted Security.

     After the occurrence of a Dissolution Event and prior to the Transfer
Restriction Termination Date, any certificate evidencing a Replacement Note
shall bear a legend in substantially the following form, unless otherwise agreed
by the Company (with written notice thereof to the Trustee):

          THE SECURITIES EVIDENCED HEREBY HAVE NOT
          BEEN REGISTERED UNDER THE U.S.
          SECURITIES ACT OF 1933, AS AMENDED (THE
          "SECURITIES ACT"), AND, ACCORDINGLY, MAY
          NOT BE OFFERED OR SOLD EXCEPT AS SET
          FORTH IN THE FOLLOWING SENTENCE. BY ITS

                             9
<PAGE>

          ACQUISITION HEREOF, THE HOLDER (1)
          REPRESENTS THAT (A) IT IS A "QUALIFIED
          INSTITUTIONAL BUYER" (AS DEFINED IN RULE
          144A UNDER THE SECURITIES ACT) OR (B) IT
          HAS ACQUIRED THE SECURITIES IN AN
          OFFSHORE TRANSACTION MEETING THE
          REQUIREMENTS OF RULE 903 OR 904 OF
          REGULATION S UNDER THE SECURITIES ACT,
          (2) AGREES THAT IT WILL NOT PRIOR TO THE
          EXPIRATION OF THE HOLDING PERIOD
          APPLICABLE TO SALES OF THE SECURITIES
          EVIDENCED HEREBY UNDER RULE 144(k) UNDER
          THE SECURITIES ACT (OR ANY SUCCESSOR
          PROVISION) RESELL OR OTHERWISE TRANSFER
          THE SECURITY EVIDENCED HEREBY EXCEPT (A)
          TO MUTUAL RISK MANAGEMENT LTD. OR ANY
          AFFILIATE THEREOF, (B) TO A QUALIFIED
          INSTITUTIONAL BUYER IN COMPLIANCE WITH
          RULE 144A UNDER THE SECURITIES ACT OR
          (C) IN AN OFFSHORE TRANSACTION MEETING
          THE REQUIREMENTS OF RULE 903 OR 904 OF
          REGULATION S UNDER THE SECURITIES ACT
          AND (3) AGREES THAT IT WILL DELIVER TO
          EACH PERSON TO WHOM THE SECURITY
          EVIDENCED HEREBY IS TRANSFERRED A NOTICE
          SUBSTANTIALLY TO THE EFFECT OF THIS
          LEGEND. AT THE REQUEST OF THE HOLDER,
          THIS LEGEND WILL BE REMOVED AFTER THE
          EXPIRATION OF THE HOLDING PERIOD
          APPLICABLE TO SALES OF THE SECURITIES
          EVIDENCED HEREBY UNDER RULE 144(k) UNDER
          THE SECURITIES ACT.

     Following the Transfer Restriction Termination Date, any Senior Note or
security issued in exchange or substitution therefor (other than Senior Notes
acquired by the Company or any Affiliate) may upon surrender of such Senior Note
or security for exchange to the Trustee in accordance with the provisions of
this Section 2.04, be exchanged for a new Senior Note or Senior Notes, of like
tenor and aggregate principal amount, which shall not bear the restrictive
legend required by this Section 2.04(c).

                                      10
<PAGE>

     (d) Any Senior Note that, prior to the Transfer Restriction Termination
Date, is purchased or owned by the Company or any Affiliate thereof may not be
resold by the Company or such Affiliate unless registered under the Securities
Act or resold pursuant to an exemption from the registration requirements
thereof.

     (e) Except as provided in (f) below, a Global Senior Note may be
transferred, in whole but not in part, only to another nominee of the
Depository, or a successor Depository selected or approved by the Company or to
a nominee of such successor Depository.

     (f) If (i) the Depository notifies the Company that it is unwilling or
unable to continue as a depositary for such Global Senior Note and no successor
depositary shall have been appointed by the Company within 90 days of such
notice or (ii) the Depository, at any time, ceases to be a clearing agency
registered under the Exchange Act at which time the Depository is required to be
so registered to act as such depositary and no successor depositary shall have
been appointed by the Company within 90 days after the Company is notified of
such event, in each case, the Company will execute and the Trustee, upon written
notice from the Company and receipt of a Company Order, will authenticate and
deliver in exchange for such Global Senior Note, the Senior Notes in definitive
registered form without coupons, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the Global Senior
Note. If (A) the Company, in its sole discretion, determines that the Senior
Notes shall no longer be represented by a Global Senior Note or (B) there shall
have occurred an Event of Default with respect to such Senior Notes, in each
case, the Company will execute and the Trustee, upon receipt of an Officers'
Certificate evidencing such determination by the Company and a Company Order,
will authenticate and make available for delivery in exchange for such Global
Senior Note, the Senior Notes in definitive registered form without coupons, in
authorized denominations, and in an aggregate principal amount equal to the
principal amount of the Global Senior Note. Such Senior Notes shall be
registered in such names and in such authorized denominations as the Depository,
pursuant to instructions from its direct or indirect participants or otherwise,
shall instruct the Trustee. The Trustee shall (i) deliver such Senior Notes to
the Depository for delivery to the Persons in whose names such Senior Notes are
so registered and (ii) cancel the Global Senior Note.

     (g) The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
First Supplemental Indenture or under applicable law with respect to any
transfer of any interest in any Senior Note (including any transfers between or
among beneficial owners in any Global Senior Note) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required

                                       11
<PAGE>

by, and to do so if and when expressly required by, the terms of this First
Supplemental Indenture and the Base Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.

     Section 2.05. Interest. (a) Interest on the principal amount of each Senior
Note will accrue and be payable at a rate (the "Interest Rate") per annum equal
to

          (i)   from and including the Closing Date to but excluding the earlier
     of (A) the Remarketing Settlement Date on which Replacement Notes are
     issued and (B) the date such principal amount is paid, LIBOR plus 150 basis
     points;

          (ii)  from and including the Remarketing Settlement Date on which
     Replacement Notes are issued to but excluding the date such principal
     amount is paid, the Winning Bid Rate; and

          (iii) notwithstanding clauses (i) and (ii) above, if the Company fails
     to pay the principal amount on the date such amount becomes due, then from
     and including such due date to but excluding the date such principal amount
     is paid, the applicable periodic Interest Rate, compounded quarterly, but
     only to the extent permitted by applicable law.

     Interest that is not paid when due will bear Additional Interest thereon
compounded quarterly at the applicable periodic Interest Rate specified above
(to the extent permitted by applicable law). The term "interest", as used
herein, includes any such Additional Interest unless otherwise stated.

     (b) Until the Remarketing Settlement Date on which Replacement Notes are
issued, interest on the Senior Notes will be payable quarterly in arrears (A) on
January 1, April 1, July 1 and October 1 of each year, commencing January 1,
2001 and (B) on such Remarketing Settlement Date (each, subject to the last
sentence of the immediately succeeding paragraph, a "Pre-Remarketing Interest
Payment Date"), and will accrue from and including the most recent date to which
interest has been paid or, if no interest has been paid, from January 1, 2001,
to but excluding the related Pre-Remarketing Interest Payment Date, except as
otherwise described below.

     The Interest Rate in effect for the period from and including the Closing
Date to but excluding January 2, 2001 shall be the rate determined by the
Calculation Agent two London Banking Days prior to Closing Date and shall equal
LIBOR plus 150 basis points. The Interest Rate in effect thereafter, for each
quarterly period from and including the immediately preceding Pre-Remarketing

                                       12
<PAGE>

Interest Payment Date to but excluding the applicable Pre-Remarketing Interest
Payment Date, shall be determined by the Calculation Agent two London Banking
Days prior to such immediately preceding Pre-Remarketing Interest Payment Date
(a "Date of Determination") and shall equal LIBOR plus 150 basis points. Upon
determination of the applicable periodic Interest Rate, the Calculation Agent
shall promptly notify the Trustee of such determination. Prior to the
Remarketing Settlement Date, the amount of interest payable for any period shall
be computed on the basis of a 360-day year and the actual number of days elapsed
in such period. If a Pre-Remarketing Interest Payment Date is not a Business
Day, then such Pre-Remarketing Interest Payment Date will be the next succeeding
Business Day, except if such Business Day is in the next succeeding calendar
month, such Pre-Remarketing Distribution Date will be the immediately preceding
Business Day.

     All percentages resulting from any calculations on the Senior Notes will be
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward (e.g.,
9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)), and all
dollar amounts used in or resulting from such calculation will be rounded to the
nearest cent (with one-half cent being rounded upward).

     (c) Except with respect to Replacement Notes, interest shall be paid to the
Person in whose name such Senior Note or any predecessor Senior Note is
registered on the books and records of the Company at the close of business on
the Regular Record Date for such interest installment, which shall be fifteen
(15) days prior to a Pre-Remarketing Interest Payment Date (the "Pre-Remarketing
Regular Record Date").

     (d) From and including the Remarketing Settlement Date on which Replacement
Notes are issued, interest on the Replacement Notes will be payable quarterly in
arrears (A) on January 1, April 1, July 1 and October 1 of each year, commencing
on the first such date following such Remarketing Settlement Date and (B) on the
Maturity Date (each, an "Interest Payment Date"), and will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from and including such Remarketing Settlement Date, to but excluding the
related Interest Payment Date, except as otherwise described below. From and
including such Remarketing Settlement Date, the amount of interest payable for
any quarterly period shall be computed on the basis of a 360-day year of twelve
30-day months. Except as provided in the last sentence of this paragraph, from
and including such Remarketing Settlement Date the amount of interest payable
for any period shorter than a full quarterly period for which interest is
computed will be computed on the basis of the actual number of days elapsed per
30-day month. If an Interest Payment Date is not a Business Day, then

                                       13
<PAGE>

such Interest Payment Date will be postponed to the next succeeding Business Day
(and without any interest or other payment in respect of any such delay).

     (e) Interest on Replacement Notes shall be paid to the Person in whose name
the Senior Note or any predecessor Senior Note is registered on the books and
records of the Company, at the close of business on the Regular Record Date for
such interest installment, which, in respect of (i) Senior Notes of which the
Property Trustee is the Holder or (ii) a Global Senior Note, shall be the close
of business on the Business Day next preceding that Interest Payment Date (the
"Regular Record Date"). If the Replacement Notes are not held by the Property
Trustee and are not represented by a Global Senior Note, the Regular Record Date
for such interest installment shall be fifteen (15) days prior to that Interest
Payment Date.

     (f) In the event that (i) the Property Trustee is the Holder of all of the
outstanding Senior Notes, (ii) a Tax Event in respect of the Trust shall have
occurred and be continuing and (iii) the Company shall not have (A) redeemed the
Senior Notes pursuant to Section 3.01 or (B) terminated the Trust pursuant to
Section 8.01(a)(iii) of the Trust Agreement, the Company shall pay to the Trust
(or its permitted successors or assigns under the Trust Agreement) for so long
as the Property Trustee, on behalf of the Trust (or its permitted successor or
assignee) is the registered holder of the Senior Notes, such additional amounts
as may be necessary in order that the amount of distributions (including any
Additional Distributions as defined in the Trust Agreement) then due and payable
by the Trust on the Preferred Securities and Common Securities that at any time
remain outstanding in accordance with the terms thereof shall not be reduced as
a result of any Additional Taxes (the "Additional Sums"). Whenever in this
Indenture or the Senior Notes there is a reference in any context to the payment
of principal of or interest on the Senior Notes, such mention shall be deemed to
include mention of the payments of the Additional Sums provided for in this
paragraph to the extent that, in such context, Additional Sums are, were or
would be payable in respect thereof pursuant to the provisions of this paragraph
and express mention of the payment of Additional Sums (if applicable) in any
provisions hereof shall not be construed as excluding Additional Sums in those
provisions hereof where such express mention is not made.

     Section 2.06. Right to Proceed. The Company acknowledges the rights of the
Holders of Preferred Securities under the Trust Agreement to take Direct Action
referred to in Section 3.08(e) thereof and Annex I thereto.

     Section 2.07. No Issuance upon the Exercise of Warrants. The Senior Notes
shall not be issuable upon the exercise of warrants.

                                       14
<PAGE>

                                   ARTICLE 3
                        Redemption of The Senior Notes

     Section 3.01. Redemption. If at any time a Special Event occurs, the
Company shall have the right (subject to the conditions set forth in the
Indenture) at any time, upon not less than 30 nor more than 60 days' notice, to
redeem the Senior Notes in whole, but not in part, within the 90 days following
the occurrence of such Special Event (the "90 Day Period") at a redemption price
equal to 100% of the principal amount of the Senior Notes plus any accrued and
unpaid interest thereon (including any Additional Interest) to the date of such
redemption (the "Redemption Price"), and, simultaneously with such redemption,
to cause a Like Amount of the Trust Securities to be redeemed by the Trust at
the Mandatory Redemption Price on a Pro Rata basis. The Redemption Price shall
be paid prior to 12:00 Noon, New York City time, on the date of such redemption
or such earlier time as the Company determines, provided that the Company shall
by 10:00 a.m. New York City time, deposit with the Trustee an amount sufficient
to pay the Redemption Price prior to the Redemption Date.

     Section 3.02. Optional Redemption by Company. Except as provided in Section
3.01, the Senior Notes are not subject to any optional redemption by the
Company.

     Section 3.03. No Sinking Fund. The Senior Notes are not entitled to the
benefit of any sinking fund.

     Section 3.04. Mandatory Redemption upon a Qualifying Offering. If at any
time a Qualifying Offering occurs, the Company shall, upon not less than 30 nor
more than 60 days' notice (and upon at least 45 days notice to the Trustee),
redeem Senior Notes having an aggregate principal amount equal to the gross
proceeds of such Qualifying Offering (without deduction of any applicable
underwriting discounts and commissions), on the 90th day following the closing
of such Qualifying Offering, and, simultaneously with such redemption, cause a
Like Amount of the Trust Securities to be redeemed by the Trust on a Pro Rata
basis at a redemption price equal to the Redemption Price.

                                       15
<PAGE>

                                   ARTICLE 4
                                   Expenses

     SECTION 4.01. Payment of Expenses. In connection with the offering, sale
and issuance of the Senior Notes to the Trust and in connection with the sale of
the Trust Securities by the Trust, the Company, in its capacity as borrower with
respect to the Senior Notes, and the Guarantor, jointly and severally, agree to:

     (a) pay all costs and expenses relating to the offering, sale and issuance
of the Senior Notes and the Trust Securities payable by the Trust pursuant to
the Purchase Agreement and compensation of the Trustee under the Indenture in
accordance with the provisions of Section 6.7 of the Base Indenture;

     (b) pay all costs and expenses of the Trust (other than payment in respect
of Trust Securities) (including, but not limited to, costs and expenses relating
to the organization of the Trust; the fees and expenses and indemnities of the
Property Trustee and the Delaware Trustee; the costs and expenses relating to
the operation of the Trust, including without limitation, costs and expenses of
accountants, attorneys, statistical or bookkeeping services, expenses for
printing, engraving, computing or accounting equipment, paying agent(s),
registrar(s), transfer agent(s), duplicating and travel; telephone and other
telecommunications expenses; and costs and expenses incurred in connection with
the acquisition, financing, and disposition of Trust assets);

     (c) pay all costs and expenses of the Trust or Property Trustee related to
the enforcement by the Property Trustee of the rights of the holders of the
Preferred Securities;

     (d) be primarily liable for any indemnification obligations arising with
respect to the Trust Agreement; and

     (e) pay any and all taxes (other than United States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs and expenses
with respect to such taxes of the Trust.

     Section 4.02. Payment upon Resignation or Removal. Upon termination of this
First Supplemental Indenture or the Base Indenture or the removal or resignation
of the Trustee pursuant to Section 6.10 of the Base Indenture, the Company and
the Guarantor, jointly and severally, agree to pay to the Trustee all amounts
accrued to the date of such termination, removal or resignation. Upon
termination of the Trust Agreement or the removal or resignation of the Delaware
Trustee, the Guarantee Trustee or the Property Trustee, as the case may be, the
Company and the Guarantor, jointly and severally, agree to pay to the Delaware

                                       16
<PAGE>

Trustee, the Guarantee Trustee or the Property Trustee and their respective
counsel, as the case may be, all amounts accrued to the date of such
termination, removal or resignation.

                                   ARTICLE 5
                          Conversion of Senior Notes

     Section 5.01. Conversion Rights. The Senior Notes are not convertible into
other securities of the Company or the Guarantor at any time.

                                   ARTICLE 6
                             Form of Senior Notes

     Section 6.01. Form of Senior Note. The Senior Notes and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit A-1.
Following the Remarketing, the Replacement Notes shall be substantially in the
form of Exhibit A-2. Each of Exhibit A-1 and Exhibit A-2 is hereby incorporated
in and expressly made a part of this First Supplemental Indenture. The Guarantee
of the Senior Notes shall be substantially in the form set forth in Section 14.6
of the Base Indenture.

                                   ARTICLE 7
                        Original Issue of Senior Notes

     SECTION 7.01. Original Issue of Senior Notes. Senior Notes in the aggregate
principal amount of $41,240,000 may, upon execution of this First Supplemental
Indenture, be executed by the Company, with the Guarantee endorsed thereon
executed by the Guarantor, and delivered to the Trustee for authentication, and
the Trustee shall thereupon authenticate and deliver such Senior Notes to or
upon the written order of the Company, in accordance with Section 3.3 of the
Base Indenture.

                                       17
<PAGE>

                                   ARTICLE 8
                            Remarketing; Reset Rate

     Section 8.01. Effectiveness of this Article; Incorporation of Remarketing
Agreement. (a) Sections 8.02 and 8.04 shall become effective if and only if the
Senior Notes have been distributed to the holders of the Trust Securities prior
to Remarketing. Notwithstanding the foregoing, on the Remarketing Settlement
Date (except in the case of a Failed Remarketing), the certificates representing
the Senior Notes held by the Property Trustee shall be exchanged for
certificates representing the Replacement Notes.

     (b) Every Person, by virtue of having become a Holder in accordance with
the terms of this Agreement, shall be deemed to have expressly assented and
agreed to the terms of, and shall be bound by, this First Supplemental
Indenture, including the terms of Exhibit B. Exhibit B is hereby incorporated in
and expressly made a part of this First Supplemental Indenture.

     Section 8.02. Determination of Reset Date; Remarketing.

     (a) (i) Subject to Section 8.04, if (x) the Closing Price of the Common
Shares on any Trading Day is less than the Trigger Price or (y) a Cross Default
occurs, and, in each case, the Senior Notes have been distributed to the holders
of the Trust Securities (each, a "Trigger Event"), the holders of a majority in
principal amount of the Senior Notes (the "Requesting Holders") will have the
right to require remarketing of the Senior Notes. The Requesting Holders may
exercise this right by delivering a written notice to the Remarketing Agent at
any time on or prior to the sixth Business Day following the date on which such
Trigger Event occurs. Upon the receipt of such notice, the Remarking Agent shall
immediately deliver a written notice to the Company on behalf of the Requesting
Holders (the "Remarketing Notice"). If the Requesting Holders exercise their
right to require the remarketing of the Senior Notes, the Reset Date shall be
the sixth Business Day after the date on which the Remarketing Notice is
delivered by the Remarketing Agent (the "Expected Reset Date").

          (ii)  If the Requesting Holders do not exercise their right to require
     the remarketing of the Senior Notes pursuant to Section 8.02(a)(i) above
     with respect to any Trigger Event, the Requesting Holders shall have the
     option to require the remarketing of the Senior Notes in accordance with
     Section 8.02(a)(i) with respect to any subsequent Trigger Event.

          (iii) Notwithstanding Section 8.02(a)(i):

                                       18
<PAGE>

               (A) the Company may, by notice to the Remarketing Agent, direct
          that the Reset Date be delayed if the Company believes it will be
          unable to meet the conditions to Remarketing in the absence of such a
          delay; and

               (B) the Remarketing Agent may, by notice to the Company, direct
          that the Reset Date be delayed if the Remarketing Agent believes that
          a Remarketing will not be successful in the absence of such a delay;

provided that the Company and the Remarketing Agent, in either such event, will
use their reasonable best efforts to establish a delayed Reset Date that is
within five Business Days after the Expected Reset Date, but in no event later
than the 15th Business Day following the date on which the related Remarketing
Notice was delivered, or the 20th Business Day in the case of a Renewed
Remarketing to which the provisions of Section 8.04 apply (as applicable, the
"Final Reset Date").

          (iv) If the Company and the Remarketing Agent have not agreed, on or
     prior to the sixth Business Day preceding the Final Reset Date, to a Reset
     Date that is not later than the Final Reset Date, a Failed Remarketing
     shall be deemed to have occurred.

     (b) The Company shall, by notice to the Remarketing Agent no later than
five Business Days prior to the Reset Date, select and specify three Reference
Corporate Dealers. By 3:00 p.m., New York City time, on the Reset Date, the
Remarketing Agent shall request Bids from such Reference Corporate Dealers. The
Remarketing Agent or an Affiliate or Associated Person thereof (any such person,
an "Affiliated Bidder") may, at its option, enter a Bid. The Remarketing Agent
shall disclose to the Company the Bids obtained and determine the lowest Bid
Rate from among the Bids obtained on the Reset Date (the "Winning Bid Rate"). By
approximately 4:30 p.m., New York City time, on the Reset Date, the Remarketing
Agent shall notify the Company and the Trustee of the Winning Bid Rate. If on a
Reset Date, Bids are not submitted by at least two Reference Corporate Dealers,
or if the lowest Bid submitted would result in a Winning Bid Rate in excess of
the rate permitted by applicable law, the Remarketing shall be deemed to be a
Failed Remarketing on the corresponding Remarketing Settlement Date. The Winning
Bid Rate determined by the Remarketing Agent, absent manifest error, shall be
binding and conclusive upon the holders of the Senior Notes, the Company, the
Guarantor, the Trust and the Trustee.

     (c) On the Reset Date, the Remarketing Agent shall designate as the
Secondary Purchaser (the "Secondary Purchaser") the Reference Corporate

                                       19
<PAGE>

Dealer providing the Bid containing the Winning Bid Rate. If the Winning Bid
Rate is specified in the Bids submitted by two or more bidders, the Remarketing
Agent shall, in consultation with the Company, designate one of such bidders as
the Secondary Purchaser.

     (d) On the Reset Date, the Secondary Purchaser shall enter into a Secondary
Purchase Agreement for the purchase by such Secondary Purchaser at the
Remarketing Price of the aggregate principal amount of Senior Notes, with an
Interest Rate equal to the Winning Bid Rate and with a Maturity Date on the
Remarketed Maturity Date.

     (e) If a Remarketing has occurred pursuant to this Section 8.02 but
settlement of the purchase and sale of the Senior Notes does not occur on the
corresponding Remarketing Settlement Date, then, unless the provisions of
Section 8.04 with respect to a Renewed Remarketing shall apply, a Failed
Remarketing shall be deemed to have occurred on such Remarketing Settlement
Date.

     (f) At the time and in the manner specified in the Secondary Purchase
Agreement, the Secondary Purchaser shall pay on the Remarketing Settlement Date
to the Remarketing Agent on behalf of the holders of the Senior Notes an amount
of cash equal to the Remarketing Price.

     (g) Unless otherwise agreed among the Remarketing Agent, the Paying Agent
and any Former Holder, the Remarketing Agent shall promptly pay the Remarketing
Price, less the Remarketing Fee, to the Paying Agent, acting solely as agent for
the Former Holders, and the Paying Agent shall pay such amount to the Former
Holders in the manner specified in the Base Indenture for payments of principal
and as otherwise specified herein.

     (h) The obligation of the Remarketing Agent to make payment to the Former
Holders in connection with the Remarketing shall be limited to the extent that
the Secondary Purchaser has delivered the Remarketing Price therefor to the
Remarketing Agent.

     (i) Any outstanding Senior Notes purchased on the Remarketing Settlement
Date shall be deemed to be transferred to the Secondary Purchaser and shall be
replaced in the manner provided in Section 8.02(j); provided that if Replacement
Notes are to be issued to the Property Trustee, the Property Trustee shall
surrender its Senior Notes to the Company for cancellation at the time of
delivery of the Replacement Notes. On and after the Remarketing Settlement Date
(except in the event of (i) a Failed Remarketing or (ii) a failure by the
Company to pay on the Remarketing Settlement Date all accrued interest

                                       20
<PAGE>

(including any Additional Interest) on the Senior Notes to such Remarketing
Settlement Date), (A) the Company shall make no further payments to, and the
Company shall have no further obligations under this First Supplemental
Indenture (or the Indenture) in respect of, the holders of such replaced Senior
Notes (the "Former Holders"), (B) the Company shall only be obligated to make
payments to the holders of Replacement Notes and (C) the Senior Notes of the
Former Holders shall no longer represent an obligation of the Company, but shall
only represent a right to receive the proceeds of the Remarketing from the
Paying Agent.

     (j) The Company shall cause replacement certificates evidencing the
remarketed Senior Notes (or, if the Preferred Securities have been remarketed,
reset Senior Notes) to be executed by the Company and authenticated by the
Trustee in accordance with the provisions of Section 3.6 of the Base Indenture
(the "Replacement Notes"). If the Replacement Notes are to be purchased on the
Remarketing Settlement Date, the Replacement Notes shall be delivered to the
purchaser or purchasers of the remarketed Senior Notes in accordance with the
terms of the Secondary Purchase Agreement.

     Section 8.03. Reset of Interest Rate and Maturity Date. From and including
the Remarketing Settlement Date on which Replacement Securities are issued, if
the Senior Notes are remarketed pursuant to Article 8 hereof or the Preferred
Securities are remarketed pursuant to Article 6 of the Trust Agreement, the
Interest Rate on the Senior Notes shall be the Winning Bid Rate and the Maturity
Date shall be the Remarketed Maturity Date.

     Section 8.04. Renewed Remarketing. If a Remarketing has occurred pursuant
to Section 8.02 that would be a Failed Remarketing pursuant to Section 8.02(e),
because the purchase and sale of the Senior Notes do not take place on the
corresponding Remarketing Settlement Date, and the reason for such failure
shall, in the good faith determination of the Remarketing Agent, result from
facts or circumstances that are not due to the action or inaction of the
Company, then the provisions of Section 8.02 shall apply to a second remarketing
(a "Renewed Remarketing") of the Senior Notes, except that the Expected Reset
Date shall be the sixth Business Day following such corresponding Remarketing
Settlement Date; provided that upon the occurrence of a Failed Remarketing
pursuant to Section 8.02, only one Renewed Remarketing may occur pursuant to
this Section 8.04, and no Renewed Remarketing shall occur after the Final Reset
Date.

     Section 8.05. Failed Remarketing. The Remarketing Agent shall give notice
of any Failed Remarketing on the date such Failed Remarketing occurs, or is
deemed to occur, by 4:00 p.m., New York City time, on the date of such Failed
Remarketing, to the Company, the Trustee and the Paying Agent.

                                       21
<PAGE>

                                   ARTICLE 9
                                 MISCELLANEOUS

         SECTION 9.01. Ratification of Base Indenture; First Supplemental
Indenture Controls. The Base Indenture, as supplemented by this First
Supplemental Indenture, is in all respects ratified and confirmed, and this
First Supplemental Indenture shall be deemed part of the Base Indenture in the
manner and to the extent herein and therein provided. The provisions of this
First Supplemental Indenture shall supersede the provisions of the Base
Indenture to the extent the Base Indenture is inconsistent herewith.

         SECTION 9.02. Trustee Not Responsible for Recitals. The recitals herein
contained are made by the Company and not by the Trustee, and the Trustee
assumes no responsibility for the correctness thereof. The Trustee makes no
representation as to the validity or sufficiency of this First Supplemental
Indenture.

         SECTION 9.03. Governing Law. This First Supplemental Indenture and each
Senior Note shall be governed by and construed in accordance with the laws of
the State of New York, as applied to contracts made and performed within the
State of New York, without regard to its principles of conflicts of laws.

         SECTION 9.04. Severability. If any provision in the Base Indenture,
this First Supplemental Indenture or in the Senior Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.

         SECTION 9.05. Counterparts. The parties may sign any number of copies
of this First Supplemental Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement. Any signed copy shall be
sufficient proof of this First Supplemental Indenture.

                                       22
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed as of the day and year first above
written.

                                      MUTUAL GROUP LTD.


                                      By: /s/ Richard O'Brien
                                         -------------------------------
                                         Title: Vice President


                                      MUTUAL RISK MANAGEMENT
                                      LTD., as Guarantor

                                      By: /s/ Elizabeth Price
                                         --------------------------------
                                         Title: Secretary


                                      THE CHASE MANHATTAN
                                      BANK, as Trustee

                                      By: /s/ Sheik Wiltshire
                                         --------------------------------
                                         Title: Second Vice President
<PAGE>

                                                                     EXHIBIT A-1

                             [FORM OF SENIOR NOTE]

IF A DISSOLUTION EVENT HAS OCCURRED, INSERT THE FOLLOWING - THE SECURITY
EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT HAS ACQUIRED THE
SECURITIES IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR
904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR
TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY
EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
PROVISION) RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY EXCEPT (A)
TO MUTUAL RISK MANAGEMENT LTD. OR ANY AFFILIATE THEREOF, (B) TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OR (C)
IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF
REGULATION S UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AT THE REQUEST OF THE HOLDER, THIS
LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO
SALES OF THE SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES
ACT.

FROM AND AFTER THE REMARKETING SETTLEMENT DATE ON WHICH REPLACEMENT NOTES ARE
ISSUED TO ANY PERSON OTHER THAN THE PROPERTY TRUSTEE, THIS INSTRUMENT SHALL
REPRESENT ONLY THE RIGHT TO RECEIVE THE REMARKETING PRICE, AND ACCRUED INTEREST
TO SUCH REMARKETING SETTLEMENT DATE, ALL AS PROVIDED IN THE INDENTURE REFERRED
TO HEREIN, AND SHALL NO LONGER REPRESENT AN OBLIGATION OF THE COMPANY.
<PAGE>

No. ________

                               MUTUAL GROUP LTD.

                    AUCTION RATE RESET SENIOR NOTE SERIES A

         Mutual Group Ltd., a Delaware corporation (the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to __________, or registered assigns,
the principal sum of ___________ dollars ($___________) on the Maturity Date.

         (a)      Interest on the principal amount of this Senior Note will
accrue and be payable at a rate (the "Interest Rate") per annum equal to

                  (i)  from and including the Closing Date to but excluding the
         earlier of (A) the Remarketing Settlement Date on which Replacement
         Notes are issued and (B) date on which the principal amount of this
         Senior Note becomes due upon the maturity, acceleration or redemption
         thereof, LIBOR plus 150 basis points; and

                  (ii) if the Company fails to pay the principal amount due upon
         the maturity, acceleration or redemption of this Senior Note on the
         date such amount becomes due, from and including such due date to but
         excluding the date of actual payment by the Company, the applicable
         periodic Interest Rate compounded quarterly.

         Interest that is not paid when due will bear Additional Interest
thereon compounded quarterly at the applicable periodic Interest Rate (to the
extent permitted by applicable law).

         The term "interest", as used herein, includes any Additional Interest
unless otherwise stated.

         (b) Until the Remarketing Settlement Date on which Replacement Notes
are issued, interest on this Senior Note will be payable quarterly in arrears
(i) on January 1, April 1, July 1 and October 1 of each year, commencing January
1, 2001 and (ii) on such Remarketing Settlement Date (each, subject to the last
sentence of the immediately succeeding paragraph, a "Pre-Remarketing Interest
Payment Date"), and will accrue from and including the most recent date to which
interest has been paid or, if no interest has been paid, from the Closing Date,
to but excluding the related Pre-Remarketing Interest Payment Date, except as
otherwise described below.

                                     A1-2
<PAGE>

         The Interest Rate in effect for the period from and including the
Closing Date to but excluding January 2, 2001 shall be the rate determined by
the Calculation Agent two London Banking Days prior to the Closing Date and
shall equal LIBOR plus 150 basis points. The Interest Rate in effect thereafter,
for each quarterly period from and including the immediately preceding Pre-
Remarketing Interest Payment Date to but excluding the applicable Pre-
Remarketing Interest Payment Date, shall be determined by the Calculation Agent
two London Banking Days prior to such immediately preceding Pre-Remarketing
Interest Payment Date (a "Date of Determination") and shall equal LIBOR plus 150
basis points. Prior to the Remarketing Settlement Date, the amount of interest
payable for any period shall be computed on the basis of a 360-day year and the
actual number of days elapsed in such period. If a Pre-Remarketing Interest
Payment Date is not a Business Day, then such Pre-Remarketing Interest Payment
Date will be the next succeeding Business Day, except if such Business Day is in
the next succeeding calendar month, such Pre-Remarketing Distribution Date will
be the immediately preceding Business Day.

         As used herein, "London Banking Day" means any day on which dealings in
deposits in U.S. Dollars are transacted in the London interbank market.

         All percentages resulting from any calculations on the Senior Notes
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded upward
(e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)), and
all dollar amounts used in or resulting from such calculations will be rounded
to the nearest cent (with one-half cent being rounded upward).

         (c) From and including the Remarketing Settlement Date on which
Replacement Notes are issued, interest on the Replacement Notes will be payable
quarterly in arrears (i) on January 1, April 1, July 1 and October 1 of each
year, commencing on such Remarketing Settlement Date and (ii) on the Maturity
Date (each, an "Interest Payment Date"), and will accrue from the most recent
date to which interest has been paid or, if no interest has been paid, from and
including such Remarketing Settlement Date, to but excluding the related
Interest Payment Date, except as otherwise described below. From and including
such Remarketing Settlement Date, the amount of interest payable for any period
shall be computed on the basis of a 360-day year of twelve 30-day months. Except
as provided in the last sentence of this paragraph, from and including the
Remarketing Settlement Date the amount of interest payable for any period
shorter than a full quarterly period for which interest is computed will be
computed on the basis of the actual number of days elapsed per 30-day month. If
an Interest Payment Date is not a Business Day, then such Interest Payment Date

                                     A1-3
<PAGE>

will be postponed to the next succeeding Business Day (and without interest or
other payment in respect of any such delay).

         (d) Interest shall be paid to the Person in whose name this Senior Note
or any predecessor Senior Note is registered on the books and records of the
Company at the close of business on the Regular Record Date for such interest
installment, which shall be fifteen (15) days prior to a Pre-Remarketing
Interest Payment Date (the "Pre-Remarketing Regular Record Date").
Notwithstanding the foregoing, so long as the Holder of this Senior Note is the
Property Trustee, the payment of the principal of (and premium, if any) and
interest on this Senior Note will be made at such place and to such account as
may be designated by the Property Trustee.

         This Senior Note shall not be entitled to any benefit under the
Indenture hereinafter referred to, or be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have been signed by
or on behalf of the Trustee.

         The provisions of this Senior Note are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.

         IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.

                                            MUTUAL GROUP LTD.


                                            By: _____________________________
                                                Name:
                                                Title:

Attest:


By: ______________________________
    Name:
    Title:

                                     A1-4
<PAGE>

                    [FORM OF CERTIFICATE OF AUTHENTICATION]

                         CERTIFICATE OF AUTHENTICATION


This is one of the Securities of the series described therein referred to in the
within-mentioned Indenture.

Dated:

THE CHASE MANHATTAN BANK,
      as Trustee

By: _________________________
    Authorized Officer

                                     A1-5
<PAGE>

                           [FORM OF REVERSE OF NOTE]

         This Senior Note is one of a duly authorized series of Securities of
the Company (herein sometimes referred to as the "Senior Notes"), specified in
the Base Indenture (as defined below), all issued or to be issued in one or more
series under and pursuant to an Indenture (the "Base Indenture") dated as of
September 21, 2000, duly executed and delivered among the Company, Mutual Risk
Management Ltd., as Guarantor (the "Guarantor"), and The Chase Manhattan Bank,
as Trustee (the "Trustee"), as supplemented by the First Supplemental Indenture
dated as of September 21, 2000 among the Company, the Guarantor and the Trustee
(the Base Indenture as so supplemented, the "Indenture"), to which Indenture and
all indentures supplemental thereto reference is hereby made for a description
of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Company and the holders of the Senior Notes. By
the terms of the Indenture, the Senior Notes are issuable thereunder in series
that may vary as to amount, date of maturity, rate of interest and in other
respects as provided in the Indenture. This series of Senior Notes is limited in
aggregate principal amount as specified in such First Supplemental Indenture and
herein sometimes referred to as the "Senior Notes."

         Because of the occurrence and continuation of a Special Event or a
Qualifying Offering, in certain circumstances, this Senior Note may become due
and payable at the principal amount together with any interest accrued thereon
(including Additional Interest) (the "Redemption Price"). The Redemption Price
shall be paid prior to 12:00 Noon, New York City time, on the date of such
redemption or at such earlier time as the Company determines. If the Maturity
Date or any other date fixed for redemption of the Senior Notes is not a
Business Day, then payment of the Redemption Price or principal payable on such
date will be made on the next succeeding day that is a Business Day with
interest thereon to the date of payment; provided that, upon prior written
notice, the Company may elect to make the payment on the immediately preceding
day that is a Business Day.

         In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Senior Notes may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.

         The Indenture contains provisions permitting the Company, the Guarantor
and the Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Senior Notes and each other series of
Securities Outstanding and affected, to execute supplemental indentures for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the

                                              A1-6
<PAGE>

provisions of the Indenture or of modifying in any manner the rights of the
holders of such Series of Securities; provided that the Company, the Guarantor
and the Trustee may not, without the consent of the holder of each Senior Note
then Outstanding and affected thereby: (a) change the time of payment of the
principal (or any installment) of any Senior Note, or reduce the principal
amount thereof, or reduce the rate or change the time of payment of interest
thereon, or impair the right to institute suit for the enforcement of any
payment on any Senior Note when due or (b) reduce the percentage in principal
amount of the Senior Notes, the consent of whose holders is required for any
such supplemental indenture. The Indenture also contains provisions providing
that the holders of a majority in aggregate principal amount of Senior Notes
may, on behalf of the holders of all Senior Notes, waive any past default with
respect to the Senior Notes and its consequences, except a default (i) in
respect of a covenant or provision of the Indenture or of any Senior Note which
cannot be modified or amended without the consent of the holder of each
Outstanding Senior Note or (ii) in the payment of the principal of, any premium
or interest (including any Additional Interest) on, or any Additional Amounts
with respect to the Senior Notes.

         No reference herein to the Indenture and no provision of this Senior
Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and premium, if
any, and interest on this Senior Note at the time and place and at the rate and
in the money herein prescribed.

         As provided in the Indenture and subject to certain limitations herein
and therein set forth, this Senior Note is transferable by the registered holder
hereof on the Securities Register of the Company, upon surrender of this Senior
Note for registration of transfer at the office or agency of the Trustee in the
City and State of New York accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company and the Securities Registrar duly
executed by the registered Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Senior Notes of authorized denominations
and for the same aggregate principal amount will be issued to the designated
transferee or transferees. No service charge will be made for any such transfer,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in relation thereto.

         Prior to due presentment for registration of transfer of this Senior
Note, the Company, the Guarantor, the Trustee, any Paying Agent and the
Securities Registrar may deem and treat the registered holder hereof as the
owner hereof (whether or not this Senior Note shall be overdue and
notwithstanding any notice of ownership or writing hereon made by anyone other
than the Securities Registrar) for the purpose of receiving payment of or on
account of the principal

                                     A1-7
<PAGE>

hereof and premium, if any, and interest due hereon and for all other purposes,
and neither the Company nor the Guarantor nor the Trustee nor any Paying Agent
nor any Securities Registrar shall be affected by any notice to the contrary.

         No recourse shall be had for the payment of the principal of or the
interest on this Senior Note, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.

         The Senior Notes of this series are issuable only in registered form
without coupons in denominations of $100,000 and any integral multiple of $1,000
thereof. A holder of Senior Notes may transfer or exchange Senior Notes held by
it only in minimum denominations of $100,000 and integral multiples of $1,000 in
excess thereof. Any attempted transfer, sale or other disposition of Senior
Notes in a denomination of less than $100,000 shall be deemed to be void and of
no legal effect whatsoever.

         All terms used in this Senior Note that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.

THE INDENTURE AND THE SENIOR NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS
PRINCIPLES OF CONFLICTS OF LAWS.

                                     A1-8
<PAGE>

         FOR VALUE RECEIVED, MUTUAL RISK MANAGEMENT LTD., a Bermuda corporation
(the "Guarantor," which term includes any successor guarantor under the
Indenture referred to in the Senior Note upon which this Guarantee is endorsed
(the "Indenture")), hereby guarantees to the holder of the Senior Note upon
which this Guarantee is endorsed the due and punctual payment of the principal
of, any premium and interest on such Senior Note, when and as the same shall
become due and payable, whether on the Maturity Date, by acceleration,
redemption, repayment or otherwise and the full and punctual performance within
applicable grace periods of all other obligations of the Company under the
Indenture and such Senior Note.

         The Guarantor hereby agrees that its obligations hereunder shall be as
principal and not merely as surety. The Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
merger, insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest or notice with respect to said
Senior Note or the indebtedness evidenced thereby and all demands whatsoever and
covenants that this Guarantee will not be discharged except by complete
performance of the obligations contained in this Guarantee.

         This Guarantee constitutes a guarantee of payment and not of collection
and is unsecured and ranks equally and ratably with all other unsecured and
unsubordinated obligations of the Guarantor.

         The Guarantor hereby certifies and warrants that all acts, conditions
and things required to be done and performed and to have happened precedent to
the creation and issuance of this Guarantee, and to constitute the same the
legal, valid and binding obligation of the Guarantor enforceable in accordance
with its terms have been done and performed and have happened in compliance with
all applicable laws.

         This Guarantee is dated the date of the Senior Note upon which it is
endorsed.

         All capitalized terms used in this Guarantee but not defined herein
which are defined in the Indenture shall have the meanings assigned to them in
the Indenture.

         The terms of this Guarantee include those stated in the Indenture. This
Guarantee is subject to all such terms, and Holders are referred to the
Indenture for a statement of such terms.

                                     A1-9
<PAGE>

         This Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Senior Note upon which this Guarantee
is endorsed shall have been executed by the Trustee under the Indenture by the
manual signature of one of its authorized officers.

         THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS
PROVISIONS THEREOF.

         IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly
executed.

                                            MUTUAL RISK MANAGEMENT LTD.


                                            By _______________________________
                                               Name:
                                               Title:

                                     A1-10
<PAGE>

                                                                     EXHIBIT A-2

                          [FORM OF REPLACEMENT NOTE]

IF THE NOTE IS TO BE A GLOBAL SENIOR NOTE, INSERT THE FOLLOWING--THIS NOTE IS IN
GLOBAL FORM WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY. UNLESS AND
UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN CERTIFICATED FORM IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, THIS SECURITY MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE (1) BY THE DEPOSITORY TO A NOMINEE OF THE
DEPOSITORY, (2) BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER
NOMINEE OF THE DEPOSITORY OR (3) BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS NOTE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55
WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
IF A DISSOLUTION EVENT HAS OCCURRED, INSERT THE FOLLOWING - THE SECURITY
EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT HAS ACQUIRED THE
SECURITIES IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR
904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR
TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY
EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
PROVISION) RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY EXCEPT (A)
TO MUTUAL RISK MANAGEMENT LTD. OR ANY AFFILIATE

                                     A2-1
<PAGE>

THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A
UNDER THE SECURITIES ACT OR (C) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT AND (3)
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY
IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AT THE
REQUEST OF THE HOLDER, THIS LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE
HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITIES EVIDENCED HEREBY UNDER RULE
144(k) UNDER THE SECURITIES ACT.

                                     A2-2
<PAGE>

No.__________                                                 CUSIP NO.________


                               MUTUAL GROUP LTD.

                    AUCTION RATE RESET SENIOR NOTE SERIES A
                               REPLACEMENT NOTE

         Mutual Group Ltd., a Delaware corporation (the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to __________, or registered assigns,
the principal sum of ____________ dollars ($__________) on the Maturity Date.

         (a) Interest on the principal amount of this Senior Note will accrue
and be payable at a rate (the "Interest Rate") per annum equal to, from and
including the date of issuance to but excluding the date such principal amount
is paid, the Winning Bid Rate; and if the Company fails to pay the principal
amount on the date such amount becomes due, then from and including such due
date to but excluding the date such principal amount is paid, the applicable
periodic Interest Rate, compounded quarterly, but only to the extent permitted
by applicable law.

         Interest that is not paid when due will bear additional interest
thereon compounded quarterly at the applicable periodic Interest Rate (to the
extent permitted by applicable law).

         The term "interest", as used herein, includes any Additional Interest
unless otherwise stated.

         (b) From and including the Remarketing Settlement Date on which the
Replacement Notes are issued, interest on this Replacement Note will be payable
quarterly in arrears (i) on January 1, April 1, July 1 and October 1 of each
year, commencing on the first such date following such Remarketing Settlement
Date on which this Replacement Note is issued and (ii) on the Maturity Date
(each, an "Interest Payment Date"), and will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from and
including such Remarketing Settlement Date, to but excluding the related
Interest Payment Date, except as otherwise described below. The amount of
interest payable for any period shall be computed on the basis of a 360-day year
of twelve 30-day months. Except as provided in the last sentence of this
paragraph, the amount of interest payable for any period shorter than a full
quarterly period for which interest is computed will be computed on the basis of
the actual number of days elapsed per 30-day month. If an Interest Payment Date
is not a Business Day, then such

                                     A2-3
<PAGE>

Interest Payment Date will be the next succeeding Business Day (and without any
interest or other payment in respect of any such delay).

         (c) Interest shall be paid to the Person in whose name the Senior Note
or any predecessor Senior Note is registered on the books and records of the
Company at the close of business on the Regular Record Date for such interest
installment, which, in respect of Senior Notes of which the Property Trustee is
the Holder or a Global Senior Note, shall be the close of business on the
Business Day next preceding that Interest Payment Date (the "Regular Record
Date"). If the Senior Notes are not represented by a Global Senior Note, the
Regular Record Date for such interest installment shall be fifteen (15) days
prior to an Interest Payment Date. Notwithstanding the foregoing, so long as the
Holder of this Senior Note is the Property Trustee, the payment of the principal
of (and premium, if any) and interest on this Senior Note will be made at such
place and to such account as may be designated by the Property Trustee.

         This Senior Note shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been signed by or on
behalf of the Trustee.

         The provisions of this Senior Note are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.

         IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.

                                                     MUTUAL GROUP LTD.



                                                     By:________________________
                                                        Name:
                                                        Title:

Attest:


By:__________________________
   Name:
   Title:

                                     A2-4
<PAGE>

                    [FORM OF CERTIFICATE OF AUTHENTICATION]

                         CERTIFICATE OF AUTHENTICATION


This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.

Dated:

THE CHASE MANHATTAN BANK,
       as Trustee

By: ___________________________
    Authorized Officer


                                     A2-5
<PAGE>

                           [FORM OF REVERSE OF NOTE]

         This Senior Note is one of a duly authorized series of Securities of
the Company (herein sometimes referred to as the "Senior Notes"), specified in
the Base Indenture (as defined below), all issued or to be issued in one or more
series under and pursuant to an Indenture (the "Base Indenture") dated as of
September 21, 2000, duly executed and delivered among the Company, Mutual Risk
Management Ltd., as Guarantor (the "Guarantor"), and The Chase Manhattan Bank,
as Trustee (the "Trustee"), as supplemented by the First Supplemental Indenture
dated as of September 21, 2000 among the Company, the Guarantor and the Trustee
(the Base Indenture as so supplemented, the "Indenture"), to which Indenture and
all indentures supplemental thereto reference is hereby made for a description
of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Company, the Guarantor and the holders of the
Senior Notes. By the terms of the Indenture, the Senior Notes are issuable
thereunder in series that may vary as to amount, date of maturity, rate of
interest and in other respects as provided in the Indenture. This series of
Senior Notes is limited in aggregate principal amount as specified in such First
Supplemental Indenture and herein sometimes referred to as the "Senior Notes."

         Because of the occurrence and continuation of a Special Event or a
Qualifying Offering in certain circumstances, this Senior Note may become due
and payable at the principal amount together with any interest accrued thereon
(including Additional Interest) (the "Redemption Price"). The Redemption Price
shall be paid prior to 12:00 Noon, New York City time, on the date of such
redemption or at such earlier time as the Company determines. If the Maturity
Date or any other date fixed for redemption of the Senior Notes is not a
Business Day, then payment of the Redemption Price or principal payable on such
date will be made on the next succeeding day that is a Business Day with
interest thereon to the date of payment; provided that, upon prior written
notice, the Company may elect to make the payment on the immediately preceding
day that is a Business Day.

         In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Senior Notes may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.

         The Indenture contains provisions permitting the Company, the Guarantor
and the Trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of the Senior Notes and each other series of
Securities Outstanding and affected, to execute supplemental indentures for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the

                                     A2-6
<PAGE>

provisions of the Indenture or of modifying in any manner the rights of the
holders of such Series of Securities; provided that the Company, the
Guarantorand the Trustee may not, without the consent of the holder of each
Senior Note then Outstanding and affected thereby: (a) change the time of
payment of the principal (or any installment) of any Senior Note, or reduce the
principal amount thereof, or reduce the rate or change the time of payment of
interest thereon, or impair the right to institute suit for the enforcement of
any payment on any Senior Note when due or (b) reduce the percentage in
principal amount of the Senior Notes, the consent of whose holders is required
for such supplemental indenture. The Indenture also contains provisions
providing that the holders of a majority in aggregate principal amount of Senior
Notes may, on behalf of the holders of all Senior Notes waive any past default
with respect to the Senior Notes and its consequences, except a default (i) in
respect of a covenant or provision of the Indenture or of any Senior Note which
cannot be modified or amended without the consent of the holder of each
Outstanding Senior Note or (ii) in the payment of the principal of, any premium
or interest (including any Additional Interest) on, or any Additional Amounts
with respect to the Senior Notes.

         No reference herein to the Indenture and no provision of this Senior
Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and premium, if
any, and interest on this Senior Note at the time and place and at the rate and
in the money herein prescribed.

         As provided in the Indenture and subject to certain limitations herein
and therein set forth, this Senior Note is transferable by the registered holder
hereof on the Securities Register of the Company, upon surrender of this Senior
Note for registration of transfer at the office or agency of the Trustee in the
City and State of New York accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company and the Securities Registrar duly
executed by the registered Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Senior Notes of authorized denominations
and for the same aggregate principal amount will be issued to the designated
transferee or transferees. No service charge will be made for any such transfer,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in relation thereto.

         Prior to due presentment for registration of transfer of this Senior
Note, the Company, the Guarantor, the Trustee, any Paying Agent and the
Securities Registrar may deem and treat the registered holder hereof as the
owner hereof (whether or not this Senior Note shall be overdue and
notwithstanding any notice of ownership or writing hereon made by anyone other
than the Securities Registrar) for the purpose of receiving payment of or on
account of the principal

                                     A2-7
<PAGE>

hereof and premium, if any, and interest due hereon and for all other purposes,
and neither the Company nor the Guarantor nor the Trustee nor any Paying Agent
nor any Securities Registrar shall be affected by any notice to the contrary.

         No recourse shall be had for the payment of the principal of or the
interest on this Senior Note, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.

         The Senior Notes of this series are issuable only in registered form
without coupons in denominations of $100,000 and any integral multiple of $1,000
thereof. A holder of Senior Notes may transfer or exchange Senior Notes held by
it only in minimum denominations of $100,000 and integral multiples of $1,000 in
excess thereof. Any attempted transfer, sale or other disposition of Senior
Notes in a denomination of less than $100,000 shall be deemed to be void and of
no legal effect whatsoever.

         All terms used in this Senior Note that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.

         THE INDENTURE AND THE SENIOR NOTES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS
PRINCIPLES OF CONFLICTS OF LAWS.

                                     A2-8
<PAGE>

         FOR VALUE RECEIVED, MUTUAL RISK MANAGEMENT LTD., a Bermuda corporation
(the "Guarantor," which term includes any successor guarantor under the
Indenture referred to in the Senior Note upon which this Guarantee is endorsed
(the "Indenture")), hereby guarantees to the holder of the Senior Note upon
which this Guarantee is endorsed the due and punctual payment of the principal
of, any premium and interest on such Senior Note, when and as the same shall
become due and payable, whether on the Maturity Date, by acceleration,
redemption, repayment or otherwise and the full and punctual performance within
applicable grace periods of all other obligations of the Company under the
Indenture and such Senior Note.

         The Guarantor hereby agrees that its obligations hereunder shall be as
principal and not merely as surety. The Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
merger, insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest or notice with respect to said
Senior Note or the indebtedness evidenced thereby and all demands whatsoever and
covenants that this Guarantee will not be discharged except by complete
performance of the obligations contained in this Guarantee.

         This Guarantee constitutes a guarantee of payment and not of collection
and is unsecured and ranks equally and ratably with all other unsecured and
unsubordinated obligations of the Guarantor.

         The Guarantor hereby certifies and warrants that all acts, conditions
and things required to be done and performed and to have happened precedent to
the creation and issuance of this Guarantee, and to constitute the same the
legal, valid and binding obligation of the Guarantor enforceable in accordance
with its terms have been done and performed and have happened in compliance with
all applicable laws.

         This Guarantee is dated the date of the Senior Note upon which it is
endorsed.

         All capitalized terms used in this Guarantee but not defined herein
which are defined in the Indenture shall have the meanings assigned to them in
the Indenture.

         The terms of this Guarantee include those stated in the Indenture. This
Guarantee is subject to all such terms, and Holders are referred to the
Indenture for a statement of such terms.

                                     A2-9
<PAGE>

         This Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Senior Note upon which this Guarantee
is endorsed shall have been executed by the Trustee under the Indenture by the
manual signature of one of its authorized officers.

         THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS
PROVISIONS THEREOF.

         IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly
executed.

                                        MUTUAL RISK MANAGEMENT LTD.


                                        By _____________________________
                                           Name:
                                           Title:


                                     A2-10
<PAGE>

                                                                       EXHIBIT B

                         FORM OF REMARKETING AGREEMENT
<PAGE>

                                                                       EXHIBIT C

                            FORM OF TRUST AGREEMENT
<PAGE>

                                                                       EXHIBIT D

                 FORM OF AMENDED AND RESTATED TRUST AGREEMENT