Document:

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                                  EXHIBIT 10.2

         Employment Contract dated December 23, 2002 between First West
                  Virginia Bancorp, Inc. and Beverly A. Barker

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                              EMPLOYMENT AGREEMENT

          THIS AGREEMENT, made in triplicate on this 23rd day of December, 2002,
by and between FIRST WEST VIRGINIA BANCORP, INC., a West Virginia corporation,
(hereinafter, "Bancorp"), and BEVERLY A. BARKER, (hereinafter, "Executive")

                              W I T N E S S E T H:

          WHEREAS, Executive is presently an employee of Bancorp pursuant to an
Employment Agreement dated December 21, 2001;

          WHEREAS, Bancorp and Executive are desirous of continuing the
employment relationship between them upon the terms and conditions set forth
herein;

          WHEREAS, Bancorp and Executive desire to enter into this Agreement and
rescind and terminate all prior employment agreements or other understandings
between them.

          NOW THEREFORE, in consideration of the premises and of the mutual
covenants and conditions herein contained, and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto,
intending to be legally bound, do hereby agree as follows:

1.   EMPLOYMENT

          Bancorp does hereby employ Executive as its Executive Vice President,
Chief Operating Officer and Treasurer and Executive does hereby accept the
employment as Executive Vice President, Chief Operating Officer and Treasurer of
Bancorp upon the terms herein set forth. The parties agree that as of the date
of this Agreement, the previous employment agreement between them dated December
21, 2001 is rescinded, terminated and no longer binding between them.

          Executive shall exercise (subject to the control of the Board of
Directors and Stockholders) a general supervision of the affairs of Bancorp and
its subsidiaries and shall devote her full business time and attention to the
business and affairs of Bancorp and its subsidiaries and use her best efforts to
promote the interests of Bancorp and its subsidiaries.

          Executive shall discharge her duties faithfully and to the best of her
ability, and generally shall perform all duties incident to the office or
offices, and such other duties as may be assigned to her by the Board of
Directors.

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          Executive shall hold such other office or offices in Bancorp or its
subsidiaries as the Board of Directors may elect or appoint her to and perform
the duties of such offices.

2.   TERM

          Executive's employment hereunder shall be effective January 1, 2003
and shall continue for a term of three (3) years thereafter, unless earlier
terminated as provided herein.

3.   COMPENSATION

          In consideration for all services to be rendered by Executive to
Bancorp and any of its subsidiaries:

          (a) Bancorp shall cause to be paid to Executive a salary of no less
than $95,000.00 per annum for a period of three (3) years commencing January 1,
2003, payable in equal monthly installments. Prior to the first anniversary and
second anniversary hereof, the Board of Directors shall review Executive's
salary and make such adjustments in the rate thereof as it shall deem
appropriate. All references herein to compensation to be paid to Executive are
to the gross amounts thereof which are due hereunder. Bancorp shall cause to be
deducted therefrom all taxes which may be required to be deducted or withheld
under any provision of the law (including but not limited to Social Security
payments and income tax withholding) now in effect or which may become effective
anytime during the term of this Agreement. In addition to such salary, Executive
shall be eligible to receive discretionary bonuses which may be granted by
Bancorp, but which have been and at all times will remain in the discretion of
the Employer. Executive may also participate in any health insurance benefit
(including medical and major medical insurance), deferred compensation benefit,
accident and disability insurance benefit or other benefits as may be offered to
other employees of Bancorp and which may become effective anytime during the
term of this Agreement.

4.   TERMINATION

          In the event of termination of the employment of Executive by Bancorp
for any reason other than a cause defined below, Executive shall be entitled to
the full compensation provided by this Agreement. In the event of termination of
the employment of Executive by Bancorp for a cause

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defined below or in the event of termination of employment by the Executive for
any cause, including her death or disability which renders her unable to perform
the material duties of her employment, her compensation shall cease on the
effective date of such termination. As used herein, the term "cause" shall mean:

          (a) A willful and intentional act of Executive intended to injure or
having the effect of injuring the reputation, business or business relationship
of Bancorp or its subsidiary businesses;

          (b) Any breach of any covenant contained in this Agreement by
Executive;

          (c) Repeated or continuous failure, neglect or refusal to perform by
Executive of her duties hereunder;

          (d) Commission by Executive of any act or any failure by Executive to
act involving serious criminal conduct or moral turpitude or which reflects
materially and adversely on Bancorp or its subsidiary businesses.

          Except for termination for cause and the expiration of the term of
this Agreement, each party agrees to provide the other with a minimum of thirty
(30) days' written notice of the termination of this Agreement.

5.   EXTENT OF SERVICES

          The parties mutually agree that Executive is a key employee who is
vital to the success of Bancorp's operations and who has received and will
continue to receive confidential information and trade secrets of the Bancorp
and its subsidiary businesses in the course of her employment. Executive shall
devote her entire time, attention, and energies to the business of the Bancorp
and shall not during the term of this Agreement be engaged in any other business
activity, whether or not such business activity is pursued for gain, profit, or
other pecuniary advantage; but such provision shall not be construed as
preventing Executive from making private investments in such form or manner as
will not require any services or material commitments of time on the part of the
Executive.

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6.   CONFIDENTIAL INFORMATION

          Executive recognizes and acknowledges that Bancorp has maintained, and
continues to maintain and use, commercially valuable proprietary and
confidential information, including without limitation, trade secrets, customer
lists, customer financial information and analysis of customers, which
information is vital to the success of Bancorp's business. Executive recognizes
and acknowledges that she has had and will continue to have access to such
information, and Executive acknowledges that all such information are valuable,
special and unique assets of Bancorp's business. Executive is aware that such
information is confidential and if used competitively against Bancorp, would
result in material disadvantage to Bancorp. Executive agrees that during the
term of employment she will neither disclose without the advance consent of
Bancorp any such confidential information to any person, firm, corporation,
association or other entity for any reason or purpose whatsoever, except
pursuant to judicial process of which Bancorp shall have notice, nor shall she
in any manner utilize the same to the disadvantage of Bancorp or its subsidiary
businesses.

          In the event of termination of employment, for any reason, Executive
shall surrender to Bancorp, immediately, and as a prior condition to receiving
any amount of compensation payable herein, if any, all such information, whether
in tangible or electronic form, including in the case of electronically stored
information, all copies of the diskettes or other media on which such
information may be stored, and Executive shall certify upon request that she has
retained none of such information, in any form.

7.   INSURANCE

          Bancorp, in its sole discretion, may apply for insurance in its own
name and for its own benefit covering Executive for life, medical or disability
insurance, in any amount deemed advisable and Executive shall have no right,
title or interest therein. Executive shall submit to any required examination
and shall execute and assign and/or deliver such application and policies
necessary to effectuate such insurance coverage.

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8.   COVENANT NOT TO COMPETE

          Executive agrees that at no time during the term of this Agreement and
for a period of two (2) years immediately following the termination of this
Agreement by any party for any reason, will Executive, individually or on behalf
of any person or corporation other than Bancorp or its subsidiary businesses,
own manage, operate, control, be employed, participate in or be connected in any
manner with the ownership, management, operation or control of any business
engaged in the rendering of any banking or non-banking service now or hereafter
provided by Bancorp or its subsidiary businesses within a thirty-five (35) mile
radius of Bancorp's principal office located in Wheeling, West Virginia.

          Notwithstanding the foregoing, if Executive terminates her employment
within thirty (30) days following a Change of Control, this paragraph 8 shall be
deemed null and void so long as Executive is otherwise not then in default of
any portion of this Agreement.

          A Change of Control is defined as:

               (a)  the acquisition by any person or group outside the present
                    Directors and their beneficial ownership of twenty percent
                    (20%) or more of the stock of Bancorp subsequent to the date
                    of this Agreement;

               (b)  the approval of Bancorp of an agreement for the merger of
                    Bancorp into another corporation not controlled by Bancorp;

               (c)  the entry by Bancorp into an Agreement for the sale of
                    substantially all of the assets of Bancorp to a third party;
                    or

               (d)  the approval by stockholders of a plan of liquidation of
                    Bancorp.

9.   NOTICES

          All notices, requests, demands and other communication hereunder shall
be in writing, and shall be deemed to have been duly given if personally
delivered or mailed:

          (a) If to Executive, addressed to her at 66406 Greenbriar Drive, St.
Clairsville, Ohio 43950;

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          (b) If to Corporation, addressed to: First West Virginia Bancorp, Inc.
Attention: Chairperson, Personnel and Salary Committee, P.O. Box 4075, Wheeling,
West Virginia 26003, or to such other place as either party may notify the other
in writing.

10.  CONSTRUCTION OF AGREEMENT

          This Agreement was executed by the parties in accordance with and be
governed and interpreted in accordance with the laws of West Virginia.

11.  BENEFITS AND BURDENS

          This Agreement shall inure to the benefit of and be binding on
Bancorp, its successors and assigns, and any corporation with which Bancorp may
merge or consolidate or to which Bancorp may sell substantially all of its
business and assets, and shall inure to the benefit of and be binding on
Executive, her executor, administrators, heirs and legal representatives. Since
Executive's duties and services hereunder are special, personal and unique in
nature, Executive may not transfer, sell or otherwise assign her rights,
obligations or benefits under this Agreement. The waiver by Bancorp of any
breach of this Agreement by Executive shall not operate or be construed as a
waiver of any subsequent breach by the Executive.

12.  ENTIRE AGREEMENT

          This Agreement contains the entire Agrement between the parties
relating to the subject matter hereof and supersedes all previous discussions,
negotiations and agreements between the parties, whether written or oral, with
respect to the subject matter hereof. This Agreement cannot be modified, altered
or amended except by a writing, signed by both parties.

13.  SEVERABILITY

          If any provision of this Agreement shall be held to be invalid or
unenforceable, such provision shall be fully severale and shall not affect or
impair the validity or enforceability of the remaining provisions of this
Agreement which shall continue to bind the parties hereto. In lieu of that
severable provision or provisions, a new provision shall be inserted which is as
close to the intent of severed provision as may be permitted by law but which is
still valid and fully enforceable.

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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
triplicate as of the year and date first above written.

                                         /s/  Beverly A. Barker
                                     -------------------------------------------
                                              BEVERLY A. BARKER

                                     FIRST WEST VIRGINIA BANCORP, INC.

                                     BY: /s/    Laura G. Inman
                                     -------------------------------------------
                                            ITS CHAIRMAN OF THE BOARD<PAGE>
                                                                     EXHIBIT 10D

                       HEALTHCARE LIABILITY EXCESS OF LOSS
                              REINSURANCE CONTRACT
                           EFFECTIVE: JANUARY 1, 2002

                                    issued to

                        Midwest Medical Insurance Company
                             Minneapolis, Minnesota

(BENFIELD BLANCH LOGO)

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                                TABLE OF CONTENTS

<Table>
<Caption>
    ARTICLE                                                                                                   Page

<S>                                                                                                            <C>
           I      Classes of Business Reinsured                                                                 1
          II      Commencement and Termination                                                                  2
         III      Territory                                                                                     4
          IV      Exclusions                                                                                    4
           V      Retention and Limit                                                                           5
          VI      Definitions                                                                                   8
         VII      Claims and Loss Adjustment Expense                                                           10
        VIII      Subrogation                                                                                  11
          IX      Reinsurance Premium                                                                          11
           X      Commission Coverages B and C                                                                 12
          XI      Profit Sharing Coverages A, D and E                                                          13
         XII      Offset                                                                                       14
        XIII      Access to Records (BRMA 1D)                                                                  14
         XIV      Net Retained Lines (BRMA 32B)                                                                14
          XV      Errors and Omissions (BRMA 14F)                                                              15
         XVI      Currency (BRMA 12A)                                                                          15
        XVII      Taxes (BRMA 50B)                                                                             15
       XVIII      Federal Excise Tax (BRMA 17A)                                                                15
         XIX      Unauthorized Reinsurers                                                                      16
          XX      Insolvency                                                                                   17
         XXI      Arbitration (BRMA 6M)                                                                        18
        XXII      Service of Suit (BRMA 49C)                                                                   19
       XXIII      Intermediary (BRMA 23A)                                                                      19
                  Schedule A
</Table>

(BENFIELD BLANCH LOGO)

<PAGE>

                       HEALTHCARE LIABILITY EXCESS OF LOSS
                              REINSURANCE CONTRACT
                           EFFECTIVE: JANUARY 1, 2002

                                    issued to

                        Midwest Medical Insurance Company
                             Minneapolis, Minnesota
                   (hereinafter referred to as the "Company")

                                       by

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

ARTICLE I - CLASSES OF BUSINESS REINSURED

A.       By this Contract the Reinsurer agrees to reinsure the excess liability
         which may accrue to the Company under its policies, contracts and
         binders of insurance or reinsurance (hereinafter called "policies")
         issued or renewed on or after the effective date hereof, and classified
         by the Company as follows:

         1.       Professional Liability business written on a claims made basis
                  as respects physicians, surgeons, dentists and ancillary
                  health care professionals;

         2.       General Liability business written on an occurrence basis and
                  Employee Benefits Administration Liability business written on
                  a claims made basis both as respects physicians, surgeons,
                  dentists and ancillary health care professional entities; and

         3.       Primary and Umbrella Excess Health Care Systems and Facilities
                  Professional Liability business written on a claims made
                  basis, related General Liability business written on an
                  occurrence basis, and related Employee Benefits Administration
                  Liability business written on a claims made basis; it being
                  understood that the combination of the Company's primary and
                  umbrella/excess policies issued to any one health care system
                  or facility shall be considered one policy. It is further
                  understood that the umbrella excess business covered hereunder
                  shall be written in excess of the following primary coverages:

                  a.       Professional and General Liability insurance with
                           minimum limits of liability of $1,000,000 as respects
                           each claim or each occurrence (as applicable) and in
                           the aggregate;

 (BENFIELD BLANCH LOGO)                                                  Page 1
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                  b.       Automobile Liability insurance with minimum limits of
                           liability of $500,000 as respects each accident,
                           combined single limit;

                  c.       Employers Liability insurance written under Workers'
                           Compensation and Employers Liability policies with
                           minimum limits of liability of $100,000 as respects
                           each accident bodily injury by accident, $500,000 as
                           respects policy limit bodily injury by disease, and
                           $100,000 as respects each employee bodily injury by
                           disease;

                  d.       Helipad Liability insurance with minimum limits of
                           liability of $1,000,000 as respects each accident and
                           in the aggregate; and

                  e.       Non-owned Aircraft insurance with minimum limits of
                           liability of $5,000,000 as respects each accident and
                           in the aggregate.

         4.       Managed Care Liability insurance, including Directors and
                  Officers Liability and Employment Practices Liability business
                  written on a claims made basis;

         in accordance with the Company original policies and subject to the
         terms, conditions and limitations hereinafter set forth.

B.       The Company may issue prior acts and extended reporting coverage in
         accordance with its original policies. Any claim under extended
         reporting coverage shall be deemed to have been reported on the day the
         original policy expired or was canceled. Premium, if any, for such
         extended reporting coverage period shall be considered fully earned by
         the Reinsurer on the last full day the original policy was in force.

ARTICLE II - COMMENCEMENT AND TERMINATION

A.       This Contract shall become effective on January 1, 2002, with respect
         to claims made against or reported to the Company on or after that date
         as respects policies allocated to underwriting years commencing on or
         after that date (or, as respects policies written on an occurrence
         basis, losses occurring under policies allocated to underwriting years
         commencing on or after that date), and shall continue in force
         thereafter until terminated.

B.       Either party may terminate this Contract on any December 31 by giving
         the other party not less than 90 days prior notice by certified mail.

C.       Further, the Company may terminate this Contract or the share of a
         Subscribing Reinsurer at any time by giving the Subscribing Reinsurer
         not less than 10 days prior written notice in the event any of the
         following circumstances occur:

 (BENFIELD BLANCH LOGO)                                                  Page 2
<PAGE>

         1.       The Subscribing Reinsurer's policyholders' surplus at the
                  inception of any underwriting year has been reduced by more
                  than 25.0% of the amount of surplus 12 months prior to that
                  date; or

         2.       The Subscribing Reinsurer's policyholders' surplus at any time
                  during any underwriting year has been reduced by more than
                  25.0% of the amount of surplus at the date of the Subscribing
                  Reinsurer's most recent financial statement filed with
                  regulatory authorities and available to the public as of the
                  inception of this Contract; or

         3.       The Subscribing Reinsurer's A.M. Best's rating has been
                  assigned or downgraded below A- and/or Standard and Poor's
                  rating is assigned or downgraded below A; or

         4.       The Subscribing Reinsurer has become merged with, acquired by
                  or controlled by any other company, corporation or
                  individual(s) not controlling the other party's operations
                  previously; or

         5.       A State Insurance Department or other legal authority has
                  ordered the Subscribing Reinsurer to cease writing business;
                  or

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

         7.       The Subscribing Reinsurer has ceased assuming new and renewal
                  property and casualty treaty reinsurance business.

D.       Unless the Company elects to reassume the ceded unearned premium in
         force on the effective date of termination, and so notifies the
         Reinsurer prior to or as promptly as possible after the effective date
         of termination, reinsurance hereunder on business in force on the
         effective date of termination shall remain in full force and effect
         until expiration, cancellation or next premium anniversary of such
         business, whichever first occurs, but in no event beyond 12 months,
         plus odd time and plus any extension of coverage for extended reporting
         coverage, following the effective date of termination.

E.       "Underwriting year" as used herein shall mean the period from January
         1, 2002 through December 31, 2002, and each subsequent 12-month period
         (or portion thereof) shall be a separate underwriting year. All
         premiums and losses from policies allocated to an underwriting year
         shall be credited or charged, respectively, to such underwriting year,
         regardless of the date said premiums earn or such losses occur. It is
         understood that a policy will be allocated to the underwriting year
         which is in effect as of:

         1.       As respects all new policies, the effective date of such
                  policies;

 (BENFIELD BLANCH LOGO)                                                  Page 3
<PAGE>

         2.       As respects renewals of one year or less term policies, the
                  renewal date of such policies;

         3.       As respects continuous or greater than one year term policies,
                  the premium anniversary date of such policies.

         Such policies shall remain in the same underwriting year, as originally
         allocated, until the next renewal date or premium anniversary date, at
         which time such policies shall be reallocated to the underwriting year
         in effect as of such date as provided in subparagraphs 2 and 3 above.

ARTICLE III - TERRITORY

This Contract shall be worldwide in its geographical scope.

ARTICLE IV - EXCLUSIONS

A.       This Contract does not apply to and specifically excludes the
         following:

         1.       Reinsurance assumed by the Company under obligatory
                  reinsurance agreements, except policies written at the request
                  of the Company and 100% reinsured by the Company.

         2.       Business written by the Company above self-insured retentions
                  (SIRs).

         3.       Business written on a co-indemnity basis.

         4.       Any business obtained through Company merger or acquisition.

         5.       Terrorism under the Healthcare System General Liability
                  Coverage Part of any Healthcare System Liability Protection
                  Policy written by the Company and issued or renewed on or
                  after July 1, 2002, which does not contain the terrorism
                  exclusions and definition as set forth in ISO Commercial
                  General Liability Coverage Endorsement GG 21 69 01 02 (as
                  conditionally approved by the jurisdictions in which the risks
                  to which this exclusion applies are located). If the Company
                  implements a definition or exclusion different from those of
                  ISO, as conditionally approved, such definition or exclusion
                  will be deemed a suitable substitute provided the Company has
                  submitted the wording to the Reinsurer and received the
                  Reinsurer's prior approval.

                  In the event a Federal terrorism cover is implemented, the
                  Company reserves the right to negotiate the terms of this
                  exclusion to coincide with the aforementioned Federal
                  terrorism cover. This in no way implies that any Federal
                  terrorism cover would automatically supercede the current
                  terms of this Contract.

 (BENFIELD BLANCH LOGO)                                                  Page 4
<PAGE>

         6.       Nuclear risks as defined in the "Nuclear Incident Exclusion
                  Clause - Liability - Reinsurance (U.S.A.)," the "Nuclear
                  Incident Exclusion Clause - Liability - Reinsurance (Canada)"
                  and the "Nuclear Energy Risks Exclusion Clause - Reinsurance
                  (Worldwide excluding U.S.A. and Canada)" attached to and
                  forming part of this Contract. However, this exclusion shall
                  not apply to nuclear exposures emanating from health care
                  facilities.

         7.       Liability as a member, subscriber or reinsurer of any pool,
                  syndicate or association.

         8.       All liability of the Company arising by contract, operation of
                  law, or otherwise, from its participation or membership,
                  whether voluntary or involuntary, in any insolvency fund.
                  "Insolvency fund" includes any guaranty fund, insolvency fund,
                  plan, pool, association, fund or other arrangement, however
                  denominated, established or governed, which provides for any
                  assessment of or payment or assumption by the Company of part
                  or all of any claim, debt, charge, fee or other obligation of
                  an insurer, or its successors or assigns, which has been
                  declared by any competent authority to be insolvent, or which
                  is otherwise deemed unable to meet any claims, debt, charge,
                  fee or other obligation in whole or in part.

         9.       Loss or damage caused by or resulting from war, invasion,
                  hostilities, acts of foreign enemies, civil war, rebellion,
                  insurrection, military or usurped power, or martial law or
                  confiscation by order of any government or public authority,
                  but this exclusion shall not apply to loss or damage covered
                  under a standard policy with a standard War Exclusion Clause.

         10.      Pollution under any General Liability policy written by the
                  Company which does not contain the pollution exclusion set
                  forth in ISO Commercial General Liability Coverage Form CG 00
                  01 (Ed. 11/88) or as subsequently amended; however, this
                  exclusion does not apply to any risk located in a jurisdiction
                  which has not approved the Insurance Services Office exclusion
                  or where other regulatory constraints prohibit the Company
                  from implementing such exclusion nor to coverage provided
                  under the Company's Limited Pollution Coverage endorsement. If
                  the Company elects to implement an exclusion different from
                  that of ISO, such exclusion will be deemed a suitable
                  substitute provided the Company has submitted the wording to
                  the Reinsurers and received the Reinsurers' prior approval.

B.       Business falling within the scope of one or more of the exclusions set
         forth in paragraph A may be submitted to the Reinsurer for special
         acceptance and, if accepted by the Reinsurer, shall be subject to all
         the terms of this Contract except as modified by the special
         acceptance.

ARTICLE V - RETENTION AND LIMIT

A.       COVERAGE A: As respects all business covered hereunder, except the
         business set forth in subparagraph 4 of paragraph A of Article I, the
         Company shall retain and be liable for the

 (BENFIELD BLANCH LOGO)                                                  Page 5
<PAGE>

         first $1,000,000 of ultimate net loss as respects each insured, each
         claim or occurrence. The Reinsurer shall then be liable for the amount
         by which such ultimate net loss exceeds the Company's retention, but
         the liability of the Reinsurer for ultimate net loss shall not exceed
         $1,000,000 as respects each insured, each claim or occurrence.

B.       COVERAGE B: As respects all business covered hereunder, except the
         business set forth in subparagraph 4 of paragraph A of Article I, the
         Company shall retain and be liable for the first amount of ultimate net
         loss as follows:

         1.       As respects policies with limits of $2,000,000 each claim or
                  occurrence and $4,000,000 in the annual aggregate, or greater,
                  $2,000,000 each insured, each claim or occurrence and
                  $4,000,000 each insured in the annual aggregate;

         2.       As respects General Liability policies or coverages with
                  limits of $2,000,000 each occurrence and in the annual
                  aggregate, or greater, $2,000,000 each insured, each
                  occurrence and in the annual aggregate.

         The Reinsurer shall then be liable for the amount by which such
         ultimate net loss exceeds the Company's retention, but the liability of
         the Reinsurer for ultimate net loss shall not exceed $10,000,000 as
         respects each insured, each claim or occurrence and in the annual
         aggregate.

C.       COVERAGE C: As respects the business set forth in subparagraph 4 of
         paragraph A of Article I, the Company shall retain and be liable for
         the first $100,000 of ultimate net loss as respects each insured, each
         claim. The Reinsurer shall then be liable for the amount by which such
         ultimate net loss exceeds the Company's retention, but the liability of
         the Reinsurer for ultimate net loss shall not exceed $900,000 as
         respects each insured, each claim.

D.       COVERAGE D: As respects all business covered hereunder, the Company
         shall retain and be liable for the following:

         1.       As respects each loss event not involving a hospital insured,
                  the first $1,500,000 of ultimate net loss; or

         2.       As respects each loss event involving a hospital insured, the
                  first $1,500,000 of ultimate net loss attributable to the
                  non-hospital insured(s), plus the ultimate net loss, if any,
                  attributable to the hospital insured(s); however the Company's
                  retention shall not exceed $2,000,000 ultimate net loss as
                  respects any one loss event involving a hospital insured.

         The Reinsurer shall then be liable for the amount by which ultimate net
         loss exceeds the Company's applicable retention, but the liability of
         the Reinsurer for ultimate net loss shall not exceed $5,000,000 as
         respects any one loss event.

         It is understood that recoveries under individual facultative
         reinsurance and under Coverages A and B of this Article shall inure to
         the benefit of Coverage D.

 (BENFIELD BLANCH LOGO)                                                  Page 6
<PAGE>

E.       COVERAGE E: The Company shall retain and be liable for the first
         $1,000,000 of the following as respects any one loss event:

         1.       The Company's retention of ultimate net loss under Coverages A
                  and/or C above, it being understood that any reinsurance
                  recoveries under Coverage A or C shall not be considered when
                  determining the Company's retention for purposes of this
                  Coverage; and then

         2.       Any loss in excess of policy limits and/or extra contractual
                  obligations (as defined in Article VI).

         The Reinsurer shall then be liable for the amount of loss in excess of
         policy limits and/or extra contractual obligations which exceeds the
         Company's retention under Coverage E, but the liability of the
         Reinsurer shall not exceed $5,000,000 as respects loss in excess of
         policy limits and/or extra contractual obligations arising out of any
         one loss event.

F.       As respects Coverages D and E hereunder, the maximum amount recoverable
         from the Reinsurer hereunder on a combined basis shall be $5,000,000 as
         respects any one loss event.

G.       In the event the Company suffers losses arising out of the same loss
         event under two or more underwriting years as defined under this
         Contract or the Company's prior contracts, which also provide for the
         prorating of the Company's retention and the Reinsurer's limit of
         liability in the same manner, or any renewals of this Contract, the
         Company's retention with respect to each underwriting year shall be
         reduced to that percentage of the Company's retention which the
         Company's losses under policies allocated to that underwriting year
         bear to the Company's total losses arising out of that loss event. The
         limit of the Reinsurer's liability shall be prorated in the same
         manner.

H.       As respects Healthcare Systems General Liability Coverage written by
         the Company, the maximum amount of ultimate net loss recoverable from
         all claims, occurrences and loss events directly or indirectly arising
         out of, relating to, or in connection with exposure to or the
         manifestation, release, dispersal, seepage, migration, discharge,
         appearance, presence, reproduction, or growth of mold, mildew, spores,
         mycotoxins, fungi, organic pathogens or other micro organisms of any
         type, nature or description shall be $5,000,000 any one underwriting
         year. This limit shall not apply to any claim, occurrence or loss event
         directly or indirectly arising out of, relating to, or in connection
         with the use of mold, mildew, spores, mycotoxins, fungi, organic
         pathogens or other microorganisms of any type, nature or description in
         connection with the rendering of professional services.

I.       As respects Healthcare Systems General Liability Coverage written by
         the Company on policies issued or renewed during the period from
         January 1, 2002 through June 30, 2002, both days inclusive, the maximum
         amount of ultimate net loss recoverable from all claims, occurrences
         and loss events arising out of terrorism (as defined in accordance with
         ISO Commercial General Liability Coverage Endorsement GG 21 69 01 02 as
         conditionally approved by the jurisdictions in which the applicable
         risks are located) shall be $5,000,000.

 (BENFIELD BLANCH LOGO)                                                  Page 7
<PAGE>

ARTICLE VI - DEFINITIONS

A.       "Ultimate net loss" as used herein is defined as the sum or sums
         (including deductibles of $250,000 or less paid by the Company or the
         insured and any loss adjustment expense, as hereinafter defined, which
         reduces the Company's limit of liability under the policy involved)
         paid or payable by the Company in settlement of claims and in
         satisfaction of judgments rendered on account of such claims, after
         deduction of all salvage, all recoveries and all claims on inuring
         insurance or reinsurance, whether collectible or not. Nothing herein
         shall be construed to mean that losses under this Contract are not
         recoverable until the Company's ultimate net loss has been ascertained.

B.       "Loss in excess of policy limits" and "extra contractual obligations"
         as used herein shall be defined as follows:

         1.       "Loss in excess of policy limits" shall mean 90.0% of any
                  amount paid or payable by the Company in excess of its policy
                  limits, but otherwise within the terms of its policy, such
                  loss in excess of its policy limits having been incurred
                  because of, but not limited to, failure by the Company to
                  settle within the policy limits or by reason of the Company's
                  alleged or actual negligence or bad faith in rejecting an
                  offer of settlement or in the preparation of the defense or in
                  the trial of an action against its insured or reinsured or in
                  the preparation or prosecution of an appeal consequent upon
                  such an action.

         2.       "Extra contractual obligations" shall mean 90.0% of any
                  punitive, exemplary, compensatory or consequential damages
                  paid or payable by the Company, not covered by any other
                  provision of this Contract and which arise from the handling
                  of any claim on business subject to the Contract, such
                  liabilities arising because of, but not limited to, failure by
                  the Company to settle within the policy limits or by reason of
                  the Company's alleged or actual negligence, fraud or bad faith
                  in rejecting an offer of settlement or in the preparation of
                  the defense or in the trial of an action against its insured
                  or reinsured or in the preparation or prosecution of an appeal
                  consequent upon such an action. An extra contractual
                  obligation shall be deemed, in all circumstances, to have
                  occurred on the same date as the loss covered or alleged to be
                  covered or alleged to be covered under the policy.

         Notwithstanding anything stated herein, this Contract shall not apply
         to any loss in excess of policy limits or any extra contractual
         obligation incurred by the Company as a result of any fraudulent and/or
         criminal act by any officer or director of the Company acting
         individually or collectively or in collusion with any individual or
         corporation or any other organization or party involved in the
         presentation, defense or settlement of any claim covered hereunder.

C.       "Insured" as used herein shall mean any party or parties provided with
         a separate policy limit by the Company.

D.       "Occurrence" shall have the same meaning as the term occurrence, claim,
         medical incident, wrongful act or such similar term, as applicable,
         under the Company's policy forms.

 (BENFIELD BLANCH LOGO)                                                  Page 8
<PAGE>

E.       "Loss event" as used herein shall mean each accident, occurrence,
         medical incident, wrongful act or series of accidents, occurrences,
         medical incidents or wrongful acts arising out of one event, whether
         involving one or several of the Company's policies or insureds. All
         bodily injury or property damage arising out of continuous or repeated
         exposure to substantially the same general conditions shall be
         considered as arising out of one event, whether involving one or
         several of the Company's policies or insureds. The date of the loss
         event shall be deemed to be the following:

         1.       As respects a loss involving one or more coverages written on
                  an occurrence basis, the date on which bodily injury or
                  property damage occurs;

         2.       As respects a loss involving one or more coverages written on
                  a claims-made basis, the date when the claim is first made in
                  accordance with the policy terms, and any related claims
                  reported subsequent to such date shall be included in such
                  loss. However, if the claim is first made during an extended
                  reporting period, the date of the loss event shall be deemed
                  to be the last day of the policy period;

         3.       As respects a loss involving one or more coverages written on
                  an occurrence basis and one or more coverages written on a
                  claims-made basis, the date on which bodily injury or property
                  damage occurs, and any related claims reported subsequent to
                  such date shall be included in such loss whether they are
                  covered under occurrence or claims-made policies.

F.       "Loss adjustment expense" as used herein shall mean expenses assignable
         to the appraisal, adjustment, settlement, litigation, investigation,
         defense and/or appeal of specific claims, regardless of how such
         expenses are classified for statutory reporting purposes. Loss
         adjustment expense shall include, but not be limited to interest on
         judgments, legal expenses, costs incurred in connection with coverage
         questions and legal actions connected thereto and declaratory judgment
         expense, as outlined below, but shall not include other salaries and
         expenses of the Company's employees or office and normal overhead
         expenses.

G.       "Declaratory judgment expense" as used herein shall mean all court
         costs, attorney's fees and expense incurred by the Company in
         contesting insurance coverage on policies reinsured hereunder and shall
         be further limited as follows:

         1.       Expenses associated with unsuccessful actions shall constitute
                  loss adjustment expense;

         2.       Expenses associated with successful or compromised actions
                  shall be recoverable at 80.0% and shall be subject to a
                  $75,000 deductible per action, which shall be retained by the
                  Company.

         Declaratory judgment expenses shall be deemed to have occurred on the
         same date as the loss covered or alleged to be covered under the
         policy.

         It is understood and agreed the maximum reinsurance recovery, as
         respects all declaratory judgment expense arising out of all business
         reinsured hereunder, shall be limited to $1,000,000 for each
         underwriting year.

 (BENFIELD BLANCH LOGO)                                                  Page 9
<PAGE>

ARTICLE VII - CLAIMS AND LOSS ADJUSTMENT EXPENSE

A.       Whenever a claim is reserved by the Company for an amount greater than
         $500,000 and/or whenever a claim appears likely to result in a claim
         under this Contract, the Company shall notify the Reinsurer. All cases
         of serious injury which, regardless of considerations of liability or
         coverage, in the opinion of the Company, might result in a claim under
         this Contract, shall be reported to the Reinsurer, including but not
         limited to the following:

         1.       Brain injury with significant cognitive, behavioral or
                  physical residual damages;

         2.       Quadriplegia or paraplegia including Cauda Equina Syndrome;

         3.       Fatalities or significantly diminished life expectancy of wage
                  earners or parents with minor children;

         4.       Any claim emanating from a Managed Care Liability, Directors
                  and Officers and/or Employment Practices Liability Insurance
                  Policy;

         5.       Any action alleging extra contractual obligations against the
                  Company;

         6.       Any declaratory judgment action brought by or against the
                  Company.

         The Company will provide individual claim reports on reported claims to
         the Reinsurer and will provide updates as needed. The Reinsurer shall
         have the right to participate, at its own expense, in the defense of
         any claim or suit or proceeding involving this reinsurance.

B.       All claim settlements made by the Company, provided they are within the
         terms of this Contract, shall be binding upon the Reinsurer, and the
         Reinsurer agrees to pay all amounts for which it may be liable
         immediately upon receipt of reasonable evidence of the amount paid by
         the Company.

C.       In the event of loss hereunder, loss adjustment expense incurred by the
         Company in connection therewith which does not reduce the Company's
         limit of liability under the policy involved shall be shared by the
         Company and the Reinsurer in the proportion the net loss, inclusive of
         loss in excess of policy limits and extra contractual obligations, paid
         or payable by the Reinsurer bears to the total loss paid or payable by
         the Company, prior to any reinsurance recoveries, but after deduction
         of all salvage, subrogation and other recoveries. However, if a verdict
         or judgment is reduced by any process other than by the trial court,
         resulting in an ultimate saving to the Reinsurer, or a judgment is
         reversed outright, the expenses incurred in securing such reduction or
         reversal shall be shared by the Company and the Reinsurer in the
         proportion that each benefits from such reduction or reversal, and the
         expenses incurred up to the time of the original verdict or judgment
         shall be shared in proportion to each party's interest in such original
         verdict or judgment. The Reinsurer's liability for such loss adjustment
         expense shall be in addition to its liability for net loss.

(BENFIELD BLANCH LOGO)                                                  Page 10
<PAGE>

ARTICLE VIII - SUBROGATION

The Reinsurer shall be credited with recoveries from subrogation (i.e.,
reimbursement obtained or recovery made by the Company, less the actual cost,
excluding salaries of officials and employees of the Company and sums paid to
attorneys as retainer, of obtaining such reimbursement or making such recovery)
on account of claims and settlements involving reinsurance hereunder. Recoveries
therefrom shall always be used to reimburse the excess carriers in the reverse
order of their priority according to their participation before being used in
any way to reimburse the Company for its primary loss. The Company hereby agrees
to enforce its rights to subrogation relating to any loss, a part of which loss
was sustained by the Reinsurer, and to prosecute all claims arising out of such
rights.

ARTICLE IX - REINSURANCE PREMIUM

A.       COVERAGES A, D AND E

         1.       As premium for the reinsurance provided hereunder during each
                  underwriting year, the Company shall pay the Reinsurer 9.75%
                  of its net written premium applicable to all subject business
                  for the underwriting year.

         2.       The Company shall pay the Reinsurer an annual deposit premium
                  of $6,000,000 in four equal installments of $1,500,000 on
                  March 31, June 30, September 30 and December 31 of each
                  underwriting year. In the event this Contract is terminated
                  prior to any December 31, no deposit premium installments
                  shall be due after the effective date of termination.

         3.       Within 45 days after the end of each underwriting year, the
                  Company shall provide a report to the Reinsurer setting forth
                  the premium due hereunder for the underwriting year, computed
                  in accordance with subparagraph 1 above, and any additional
                  premium due the Reinsurer or return premium due the Company
                  shall be remitted promptly.

         4.       "Net written premium" as used herein is defined as gross
                  written premium of the Company for primary policy limits of
                  $2,000,000 or less for the classes of business reinsured
                  hereunder, less cancellations and return premiums, and less
                  premiums ceded by the Company for inuring facultative
                  reinsurance, if any.

B.       COVERAGE B

         1.       As premium for the reinsurance provided hereunder during each
                  underwriting year, the Company shall pay the Reinsurer the
                  percentage of its excess limits net written premium set forth
                  in Schedule A, subject to the minimum premiums per $1,000,000
                  of policy limit, gross of ceding commission, for health care
                  facilities set forth below:

                  a.       As respects hospitals with at least 200 occupied
                           beds, $4,000;

(BENFIELD BLANCH LOGO)                                                  Page 11
<PAGE>

                  b.       As respects hospitals with 100 to 199 occupied beds,
                           $2,500;

                  c.       As respects hospitals with less than 100 occupied
                           beds which provide obstetrical services, $3,000;

                  d.       As respects hospitals with 50 to 99 occupied beds,
                           $2,500;

                  e.       As respects hospitals with less than 50 occupied
                           beds, $2,500;

                  f.       As respects non-hospital health care exposures,
                           $2,500;

                  g.       As respects nursing homes or long-term care
                           facilities, $2,500;

                  h.       As respects non-medical professional liability
                           exposures, $1,500.

         2.       The Company shall pay the Reinsurer an annual deposit premium
                  of $2,500,000 for the underwriting year in four equal
                  installments of $625,000 on March 31, June 30, September 30
                  and December 31 of each underwriting year. In the event this
                  Contract is terminated prior to any December 31, no deposit
                  premium installments shall be due after the effective date of
                  termination.

         3.       Within 45 days after the end of each underwriting year, the
                  Company shall report its excess limits net written premium for
                  the underwriting year. Any additional premium due the
                  Reinsurer, at the rate set forth in Schedule A, shall be paid
                  by the Company with its report, and any return premium due the
                  Company shall be remitted promptly.

C.       COVERAGE C

         1.       As premium for the reinsurance provided hereunder during each
                  underwriting year, the Company shall pay the Reinsurer 100% of
                  its excess limits net written premium applicable to that
                  portion of the policy limit exceeding the Company's retention
                  under Coverage C of Article V.

         2.       Within 45 days after the end of each calendar quarter, the
                  Company shall report its excess limits net written premium for
                  the calendar quarter. The premium due the Reinsurer shall be
                  paid by the Company with its report.

ARTICLE X - COMMISSION - COVERAGES B AND C

A.       As respects Coverages B and C of Article V business only, the Reinsurer
         shall allow the Company a 25.0% commission on all premiums ceded to the
         Reinsurer hereunder. The Company shall allow the Reinsurer return
         commission on return premiums at the same rate.

(BENFIELD BLANCH LOGO)                                                  Page 12
<PAGE>

B.       It is expressly agreed that the ceding commission allowed the Company
         includes provision for all dividends, commissions, taxes, assessments,
         and all other expenses of whatever nature, except loss adjustment
         expense.

ARTICLE XI - PROFIT SHARING - COVERAGES A, D AND E

A.       The Reinsurer shall pay the Company profit sharing equal to 35.0% of
         the net profit, if any, accruing to the Reinsurer during each
         accounting period. As respects Subscribing Reinsurers who participated
         on the Company's Healthcare Liability Excess of Loss Reinsurance
         Contract, effective January 1, 2001 and terminated December 31, 2001,
         the first accounting period shall include the period January 1, 2001
         through December 31, 2001 and shall be from January 1, 2001 through
         December 31, 2003, and each subsequent 36-month period that this
         Contract continues in force thereafter shall be a separate accounting
         period. As respects all other Subscribing Reinsurers hereunder, the
         first accounting period shall be from January 1, 2002 through December
         31, 2003, and each subsequent 36-month period that this Contract
         continues in force thereafter shall be a separate accounting period. In
         the event this Contract is terminated, the final accounting period
         shall be from the beginning of the then current accounting period
         through the date of termination if this Contract is terminated on a
         "cutoff" basis, or through the end of the "runoff" period if this
         Contract is terminated on a "runoff" basis.

B.       The Reinsurer's net profit for each accounting period shall be
         calculated in accordance with the following formula, it being
         understood that a positive balance equals net profit and a negative
         balance equals net loss:

         1.       Premiums earned for policies allocated to the accounting
                  period; less

         2.       Expenses incurred by the Reinsurer at 25.0% of premiums earned
                  for policies allocated to the accounting period; less

         3.       Losses incurred for policies allocated to the accounting
                  period; less

         4.       The Reinsurer's net loss, if any, from the immediately
                  preceding accounting period. It is understood that the net
                  loss, if any, from an accounting period shall be carried
                  forward to extinction.

C.       The Company shall calculate and report the Reinsurer's net profit
         within 45 days after 24 months following the end of each accounting
         period, and within 45 days after the end of each 12-month period
         thereafter until all losses subject hereto have been finally settled.
         Each such calculation shall be based on cumulative transactions
         hereunder from the beginning of the accounting period through the
         effective date of calculation. As respects the initial calculation
         referred to above, any profit sharing shown to be due the Company shall
         be paid by the Reinsurer as promptly as possible after receipt and
         verification of the Company's report. As respects each recalculation,
         any additional profit sharing shown to be due the Company shall be paid
         by the Reinsurer as promptly as possible after receipt and

(BENFIELD BLANCH LOGO)                                                  Page 13
<PAGE>
         verification of the Company's report. Any return profit sharing shown
         to be due the Reinsurer shall be paid by the Company with its report.

D.       "Losses incurred" as used herein shall mean ceded losses and loss
         adjustment expense paid as of the effective date of calculation, plus
         the Company's ceded reserves for losses and loss adjustment expense
         outstanding as of the same date, it being understood and agreed that
         all losses and related loss adjustment expense under policies allocated
         to an accounting period shall be charged to that accounting period,
         regardless of the date said losses actually occur, unless this Contract
         is terminated on a "cutoff" basis, in which event the Reinsurer shall
         have no liability for claims made or occurrences commencing after the
         effective date of termination.

E.       "Premiums earned" as used herein shall mean the ceded written premiums
         for policies (or endorsements) allocated to the accounting period, less
         the unearned portion thereof as of the effective date of calculation,
         it being understood that all premium from policies (or endorsements)
         allocated to an accounting period shall be credited to that accounting
         period, unless this Contract is terminated on a "cutoff" basis and the
         Company reassumes the unearned premium as of the effective date of
         termination.

ARTICLE XII - OFFSET

The Company and the Reinsurer shall have the right to offset any balance or
amounts due from one party to the other under the terms of this Contract or any
other contract heretofore or hereafter entered into between the Company, whether
acting as assuming reinsurer or ceding company. The party asserting the right of
offset may exercise such right any time whether the balances due are on account
of premiums or losses or otherwise.

ARTICLE XIII - ACCESS TO RECORDS (BRMA 1D)

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

ARTICLE XIV - NET RETAINED LINES (BRMA 32B)

A.       This Contract applies only to that portion of any policy which the
         Company retains net for its own account, and in calculating the amount
         of any loss hereunder and also in computing the amount or amounts in
         excess of which this Contract attaches, only loss or losses in respect
         of that portion of any policy which the Company retains net for its own
         account shall be included.

B.       The amount of the Reinsurer's liability hereunder in respect of any
         loss or losses shall not be increased by reason of the inability of the
         Company to collect from any other reinsurer(s), whether specific or
         general, any amounts which may have become due from such

(BENFIELD BLANCH LOGO)                                                  Page 14
<PAGE>

         reinsurer(s), whether such inability arises from the insolvency of such
         other reinsurer(s) or otherwise.

ARTICLE XV - ERRORS AND OMISSIONS (BRMA 14F)

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

ARTICLE XVI - CURRENCY (BRMA 12A)

A.       Whenever the word "Dollars" or the "$" sign appears in this Contract,
         they shall be construed to mean United States Dollars and all
         transactions under this Contract shall be in United States Dollars.

B.       Amounts paid or received by the Company in any other currency shall be
         converted to United States Dollars at the rate of exchange at the date
         such transaction is entered on the books of the Company.

ARTICLE XVII - TAXES (BRMA 50B)

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

ARTICLE XVIII - FEDERAL EXCISE TAX (BRMA 17A)

(Applicable to those reinsurers, excepting Underwriters at Lloyd's London and
other reinsurers exempt from Federal Excise Tax, who are domiciled outside the
United States of America.)

A.       The Reinsurer has agreed to allow for the purpose of paying the Federal
         Excise Tax the applicable percentage of the premium payable hereon as
         imposed under Section 4371 of the Internal Revenue Code to the extent
         such premium is subject to the Federal Excise Tax.

B.       In the event of any return of premium becoming due hereunder the
         Reinsurer will deduct the applicable percentage from the return premium
         payable hereon and the Company or its agent should take steps to
         recover the tax from the United States Government.

(BENFIELD BLANCH LOGO)                                                  Page 15
<PAGE>

ARTICLE XIX - UNAUTHORIZED REINSURERS

A.       If the Reinsurer is unauthorized in any state of the United States of
         America or the District of Columbia, the Reinsurer agrees to fund its
         share of the Company's ceded United States unearned premium and
         outstanding loss and loss adjustment expense reserves (including
         incurred but not reported loss reserves) by:

         1.       Clean, irrevocable and unconditional letters of credit issued
                  and confirmed, if confirmation is required by the insurance
                  regulatory authorities involved, by a bank or banks meeting
                  the NAIC Securities Valuation Office credit standards for
                  issuers of letters of credit and acceptable to said insurance
                  regulatory authorities; and/or

         2.       Escrow accounts for the benefit of the Company; and/or

         3.       Cash advances;

         if, without such funding, a penalty would accrue to the Company on any
         financial statement it is required to file with the insurance
         regulatory authorities involved. The Reinsurer, at its sole option, may
         fund in other than cash if its method and form of funding are
         acceptable to the insurance regulatory authorities involved.

B.       With regard to funding in whole or in part by letters of credit, it is
         agreed that each letter of credit will be in a form acceptable to
         insurance regulatory authorities involved, will be issued for a term of
         at least one year and will include an "evergreen clause," which
         automatically extends the term for at least one additional year at each
         expiration date unless written notice of non-renewal is given to the
         Company not less than 30 days prior to said expiration date. The
         Company and the Reinsurer further agree, notwithstanding anything to
         the contrary in this Contract, that said letters of credit may be drawn
         upon by the Company or its successors in interest at any time, without
         diminution because of the insolvency of the Company or the Reinsurer,
         but only for one or more of the following purposes:

         1.       To reimburse itself for the Reinsurer's share of unearned
                  premiums returned to insureds on account of policy
                  cancellations, unless paid in cash by the Reinsurer;

         2.       To reimburse itself for the Reinsurer's share of losses and/or
                  loss adjustment expense paid under the terms of policies
                  reinsured hereunder, unless paid in cash by the Reinsurer;

         3.       To reimburse itself for the Reinsurer's share of any other
                  amounts claimed to be due hereunder, unless paid in cash by
                  the Reinsurer;

         4.       To fund a cash account in an amount equal to the Reinsurer's
                  share of any ceded unearned premium and/or outstanding loss
                  and loss adjustment expense reserves (including incurred but
                  not reported loss reserves) funded by means of a letter of
                  credit which is under non-renewal notice, if said letter of
                  credit has not been renewed or replaced by the Reinsurer 10
                  days prior to its expiration date;

(BENFIELD BLANCH LOGO)                                                  Page 16
<PAGE>

         5.       To refund to the Reinsurer any sum in excess of the actual
                  amount required to fund the Reinsurer's share of the Company's
                  ceded unearned premium and/or outstanding loss and loss
                  adjustment expense reserves (including incurred but not
                  reported loss reserves), if so requested by the Reinsurer.

         In the event the amount drawn by the Company on any letter of credit is
         in excess of the actual amount required for B(1), B(2) or B(4), or in
         the case of B(3), the actual amount determined to be due, the Company
         shall promptly return to the Reinsurer the excess amount so drawn.

ARTICLE XX - INSOLVENCY

A.       In the event of the insolvency of the Company, this reinsurance shall
         be payable directly to the Company or to its liquidator, receiver,
         conservator or statutory successor on the basis of the liability of the
         Company without diminution because of the insolvency of the Company or
         because the liquidator, receiver, conservator or statutory successor of
         the Company has failed to pay all or a portion of any claim. It is
         agreed, however, that the liquidator, receiver, conservator or
         statutory successor of the Company shall give written notice to the
         Reinsurer of the pendency of a claim against the Company indicating the
         policy or bond reinsured which claim would involve a possible liability
         on the part of the Reinsurer within a reasonable time after such claim
         is filed in the conservation or liquidation proceeding or in the
         receivership, and that during the pendency of such claim, the Reinsurer
         may investigate such claim and interpose, at its own expense, in the
         proceeding where such claim is to be adjudicated, any defense or
         defenses that it may deem available to the Company or its liquidator,
         receiver, conservator or statutory successor. The expense thus incurred
         by the Reinsurer shall be chargeable, subject to the approval of the
         Court, against the Company as part of the expense of conservation or
         liquidation to the extent of a pro rata share of the benefit which may
         accrue to the Company solely as a result of the defense undertaken by
         the Reinsurer.

B.       Where two or more reinsurers are involved in the same claim and a
         majority in interest elect to interpose defense to such claim, the
         expense shall be apportioned in accordance with the terms of this
         Contract as though such expense had been incurred by the Company.

C.       It is further understood and agreed that, in the event of the
         insolvency of the Company, the reinsurance under this Contract shall be
         payable directly by the Reinsurer to the Company or to its liquidator,
         receiver or statutory successor, except as provided by Section 4118(a)
         of the New York Insurance Law or except (1) where this Contract
         specifically provides another payee of such reinsurance in the event of
         the insolvency of the Company or (2) where the Reinsurer with the
         consent of the direct insured or insureds has assumed such policy
         obligations of the Company as direct obligations of the Reinsurer to
         the payees under such policies and in substitution for the obligations
         of the Company to such payees.

(BENFIELD BLANCH LOGO)                                                  Page 17
<PAGE>

ARTICLE XXI - ARBITRATION (BRMA 6M)

A.       As a condition precedent to any right of action hereunder, any dispute
         arising out of the interpretation, performance or breach of this
         Contract, including the formation or validity thereof, shall be
         submitted for decision to a panel of three arbitrators. Notice
         requesting arbitration will be in writing and sent certified or
         registered mail, return receipt requested.

B.       One arbitrator shall be chosen by each party and the two arbitrators
         shall, before instituting the hearing, choose an impartial third
         arbitrator who shall preside at the hearing. If either party fails to
         appoint its arbitrator within 30 days after being requested to do so by
         the other party, the latter, after 30 days notice by certified or
         registered mail of its intention to do so, may appoint the second
         arbitrator.

C.       If the two arbitrators are unable to agree upon the third arbitrator
         within 30 days of their appointment, the third arbitrator shall be
         selected from a list of six individuals (three named by each
         arbitrator) by a judge of the federal district court having
         jurisdiction over the geographical area in which the arbitration is to
         take place, or if the federal court declines to act, the state court
         having general jurisdiction in such area.

D.       All arbitrators shall be disinterested active or former executive
         officers of insurance or reinsurance companies or Underwriters at
         Lloyd's, London.

E.       Within 30 days after notice of appointment of all arbitrators, the
         panel shall meet and determine timely periods for briefs, discovery
         procedures and schedules for hearings.

F.       The panel shall be relieved of all judicial formality and shall not be
         bound by the strict rules of procedure and evidence. Unless the panel
         agrees otherwise, arbitration shall take place in Minneapolis,
         Minnesota, but the venue may be changed when deemed by the panel to be
         in the best interest of the arbitration proceeding. Insofar as the
         arbitration panel looks to substantive law, it shall consider the law
         of the State of Minnesota. The decision of any two arbitrators when
         rendered in writing shall be final and binding. The panel is empowered
         to grant interim relief as it may deem appropriate.

G.       The panel shall make its decision considering the custom and practice
         of the applicable insurance and reinsurance business as promptly as
         possible following the termination of the hearings. Judgment upon the
         award may be entered in any court having jurisdiction thereof.

H.       Each party shall bear the expense of its own arbitrator and shall
         jointly and equally bear with the other party the cost of the third
         arbitrator. The remaining costs of the arbitration shall be allocated
         by the panel. The panel may, at its discretion, award such further
         costs and expenses as it considers appropriate, including but not
         limited to attorneys fees, to the extent permitted by law.

(BENFIELD BLANCH LOGO)                                                  Page 18
<PAGE>

ARTICLE XXII - SERVICE OF SUIT (BRMA 49C)

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

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

B.       Further, pursuant to any statute of any state, territory or district of
         the United States which makes provision therefor, the Reinsurer hereby
         designates the party named in its Interests and Liabilities Agreement,
         or if no party is named therein, the Superintendent, Commissioner or
         Director of Insurance or other officer specified for that purpose in
         the statute, or his successor or successors in office, as its true and
         lawful attorney upon whom may be served any lawful process in any
         action, suit or proceeding instituted by or on behalf of the Company or
         any beneficiary hereunder arising out of this Contract.

ARTICLE XXIII - INTERMEDIARY (BRMA 23A)

Benfield Blanch Inc. is hereby recognized as the Intermediary negotiating this
Contract for all business hereunder. All communications (including but not
limited to notices, statements, premium, return premium, commissions, taxes,
losses, loss adjustment expense, salvages and loss settlements) relating thereto
shall be transmitted to the Company or the Reinsurer through Benfield Blanch
Inc., 3600 West 80th Street, Minneapolis, Minnesota 55431. Payments by the
Company to the Intermediary shall be deemed to constitute payment to the
Reinsurer. Payments by the Reinsurer to the Intermediary shall be deemed to
constitute payment to the Company only to the extent that such payments are
actually received by the Company.

IN WITNESS WHEREOF, the Company by its duly authorized representative has
executed this Contract as of the date undermentioned at:

Minneapolis, Minnesota, this ____ day of _________________ in the year _______.

                             --------------------------------------------------
                             Midwest Medical Insurance Company

(BENFIELD BLANCH LOGO)                                                  Page 19
<PAGE>

                                   SCHEDULE A

                       HEALTHCARE LIABILITY EXCESS OF LOSS
                              REINSURANCE CONTRACT
                           EFFECTIVE: JANUARY 1, 2002

                                    issued to

                        Midwest Medical Insurance Company
                             Minneapolis, Minnesota

<Table>
<Caption>
                                                             PERCENTAGE OF PRECEDING LAYER'S PREMIUM

                                                        PHYSICIANS AND                      HEALTH CARE
              COVERAGE BY LAYER                            SURGEONS*                        FACILITIES**

<S>                                                     <C>                                 <C>
       $1,000,000 excess of $2,000,000                       50.0%                             60.0%
       $1,000,000 excess of $3,000,000                       55.0%                             65.0%
       $1,000,000 excess of $4,000,000                       60.0%                             70.0%
       $1,000,000 excess of $5,000,000                       65.0%                             75.0%
       $1,000,000 excess of $6,000,000                       70.0%                             80.0%
       $1,000,000 excess of $7,000,000                       70.0%                             85.0%
       $1,000,000 excess of $8,000,000                       70.0%                             85.0%
       $1,000,000 excess of $9,000,000                       70.0%                             85.0%
       $1,000,000 excess of $10,000,000                      70.0%                             85.0%
       $1,000,000 excess of $11,000,000                      70.0%                             85.0%
</Table>

         The base $1,000,000 excess $1,000,000 increased limits factor equals
         1.18 (18% of the first $1,000,000 premium prior to any deductible
         credits).

Notes:

*        Includes dentists and ancillary health care professionals.

**       Effective April 1, 2002 as respects Health Care facility business
         issued or renewed on or after that date. Physicians and Surgeon factors
         shall be utilized for policies issued or renewed during the period
         January 1, 2002 through March 31, 2002.

(BENFIELD BLANCH LOGO)
<PAGE>

U.S.A.

                 NUCLEAR INCIDENT EXCLUSION CLAUSE - LIABILITY -
             REINSURANCE (Approved by Lloyd's Underwriters' Fire and
                             Non-Marine Association)

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

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

      LIMITED EXCLUSION PROVISION.*

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

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

         III.     The inception dates and thereafter of all original policies as
                  described in II above, whether new, renewal or replacement,
                  being policies which either

                  (a) become effective on or after 1st May, 1960, or

                  (b) become effective before that date and contain the Limited
                  Exclusion Provision set out above;

                  provided this paragraph (2) shall not be applicable to Family
                  Automobile Policies, Special Automobile Policies, or policies
                  or combination policies of a similar nature, issued by the
                  Reassured on New York risks, until 90 days following approval
                  of the Limited Exclusion Provision by the Governmental
                  Authority having jurisdiction thereof.

         (3) Except for those classes of policies specified in Clause II of
paragraph (2) and without in any way restricting the operation of paragraph (1)
of this Clause, it is understood and agreed that for all purposes of this
reinsurance the original liability policies of the Reassured (new, renewal and
replacement) affording the following coverages:

                  Owners, Landlords and Tenants Liability, Contractual
                  Liability, Elevator Liability, Owners or Contractors
                  (including railroad) Protective Liability, Manufacturers and
                  Contractors Liability, Product Liability, Professional and
                  Malpractice Liability, Storekeepers Liability, Garage
                  Liability, Automobile Liability (including Massachusetts Motor
                  Vehicle or Garage Liability)

shall be deemed to include, with respect to such coverages, from the time
specified in Clause V of this paragraph (3), the following provision (specified
as the Broad Exclusion Provision):

      BROAD EXCLUSION PROVISION.*

It is agreed that the policy does not apply:

         I.       Under any Liability Coverage to (injury, sickness, disease,
                  death or destruction (bodily injury or property damage

                  (a)      with respect to which an insured under the policy is
                           also an insured under a nuclear energy liability
                           policy issued by Nuclear Energy Liability Insurance
                           Association, Mutual Atomic Energy Liability
                           Underwriters or Nuclear Insurance Association of
                           Canada, or would be an insured under any such policy
                           but for its termination upon exhaustion of its limit
                           of liability; or

                  (b)      resulting from the hazardous properties of nuclear
                           material and with respect to which (1) any person or
                           organization is required to maintain financial
                           protection pursuant to the Atomic Energy Act of 1954,
                           or any law amendatory thereof, or (2) the insured is,
                           or had this policy not been issued would be, entitled
                           to indemnity from the United States of America, or
                           any agency thereof, under any agreement entered into
                           by the United States of America, or any agency
                           thereof, with any person or organization.

                                                                     Page 1 of 2

<PAGE>

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

         III.     Under any Liability Coverage to (injury, sickness, disease,
                  death or destruction (bodily injury or property damage
                  resulting from the hazardous properties of nuclear material,
                  if

                  (a)      the nuclear material (1) is at any nuclear facility
                           owned by, or operated by or on behalf of, an insured
                           or (2) has been discharged or dispersed therefrom;

                  (b)      the nuclear material is contained in spent fuel or
                           waste at any time possessed, handled, used,
                           processed, stored, transported or disposed of by or
                           on behalf of an insured; or

                  (c)      the
                           (injury, sickness, disease, death or destruction
                           (bodily injury or property damage
                           arises out of the furnishing by an insured of
                           services, materials, parts or equipment in
                           connection with the planning, construction,
                           maintenance, operation or use of any nuclear
                           facility, but if such facility is located within
                           the United States of America, its territories,or
                           possessions or Canada, this exclusion (c) applies
                           only to
                           (injury to or destruction of property at such
                           nuclear facility
                           (property damage to such nuclear facility
                           and any property thereat.

         IV.      As used in this endorsement:

                "hazardous properties" include radioactive, toxic or explosive
                properties; "nuclear material" means source material, special
                nuclear material or byproduct material; "source material",
                "special nuclear material", and "byproduct material" have the
                meanings given them in the Atomic Energy Act of 1954 or in any
                law amendatory thereof; "spent fuel" means any fuel element or
                fuel component, solid or liquid, which has been used or exposed
                to radiation in a nuclear reactor; "waste" means any waste
                material (1) containing byproduct material and (2) resulting
                from the operation by any person or organization of any nuclear
                facility included within the definition of nuclear facility
                under paragraph (a) or (b) thereof; "nuclear facility" means

                  (a)      any nuclear reactor,

                  (b)      any equipment or device designed or used for (1)
                           separating the isotopes of uranium or plutonium, (2)
                           processing or utilizing spent fuel, or (3) handling
                           processing or packaging waste,

                  (c)      any equipment or device used for the processing,
                           fabricating or alloying of special nuclear material
                           if at any time the total amount of such material in
                           the custody of the insured at the premises where such
                           equipment or device is located consists of or
                           contains more than 25 grams of plutonium or uranium
                           233 or any combination thereof, or more than 250
                           grams of uranium 235,

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

                  and includes the site on which any of the foregoing is
                  located, all operations conducted on such site and all
                  premises used for such operations; "nuclear reactor" means any
                  apparatus designed or used to sustain nuclear fission in a
                  self-supporting chain reaction or to contain a critical mass
                  of fissionable material; ( With respect to injury to or
                  destruction of property, the word "injury" or "destruction" (
                  "property damage" includes all forms of radioactive
                  contamination of property. ( includes all forms of radioactive
                  contamination of property.

         V.       The inception dates and thereafter of all original policies
                  affording coverages specified in this paragraph (3), whether
                  new, renewal or replacement, being policies which become
                  effective on or after 1st May, 1960, provided this paragraph
                  (3) shall not be applicable to

                           (i)      Garage and Automobile Policies issued by the
                                    Reassured on New York risks, or

                           (ii)     statutory liability insurance required under
                                    Chapter 90, General Laws of Massachusetts,
                                    until 90 days following approval of the
                                    Broad Exclusion Provision by the
                                    Governmental Authority having jurisdiction
                                    thereof.

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

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

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

21/9/67
N.M.A. 1590

                                                                     Page 2 of 2
<PAGE>

           NUCLEAR INCIDENT EXCLUSION CLAUSE - LIABILITY - REINSURANCE
                                     CANADA

1. This Agreement does not cover any loss or liability accruing to the Reinsured
as a member of, or subscriber to, any association of insurers or reinsurers
formed for the purpose of covering nuclear energy risks or as a direct or
indirect reinsurer of any such member, subscriber, or association.

2. Without in any way restricting the operation of paragraph 1 of this clause it
is agreed that for all purposes of this Agreement all the original liability
contracts of the Reinsured, whether new, renewal or replacement, of the
following classes, namely,

               Personal Liability,
               Farmers Liability,
               Storekeepers Liability,

which become effective on or after 31st December 1984, shall be deemed to
include, from their inception dates and thereafter, the following provision: --

       LIMITED EXCLUSION PROVISION

       This Policy does not apply to bodily injury or property damage with
       respect to which the Insured is also insured under a contract of nuclear
       energy liability insurance (whether the Insured is named in such contract
       or not and whether or not it is legally enforceable by the Insured)
       issued by the Nuclear Insurance Association of Canada or any other group
       or pool of insurers or would be an Insured under any such policy but for
       its termination upon exhaustion of its limit of liability.

       With respect to property, loss of use of such property shall be deemed to
be property damage.

3. Without in any way restricting the operation of paragraph 1 of this clause it
is agreed that for all purposes of this Agreement all the original liability
contracts of the Reinsured, whether new, renewal or replacement, of any class
whatsoever (other than Personal Liability, Farmers Liability, Storekeepers
Liability or Automobile Liability contracts), which become effective on or after
31st December 1984, shall be deemed to include, from their inception dates and
thereafter, the following provision: --

         BROAD EXCLUSION PROVISION

         It is agreed that this Policy does not apply:

         (a)      to liability imposed by or arising under the Nuclear Liability
                  Act; or

         (b)      to bodily injury or property damage with respect to which an
                  Insured under this Policy is also insured under a contract of
                  nuclear energy liability insurance (whether the Insured is
                  named in such contract or not and whether or not it is legally
                  enforceable by the Insured) issued by the Nuclear Insurance
                  Association of Canada or any other insurer or group or pool of
                  insurers or would be an Insured under any such policy but for
                  its termination upon exhaustion of its limit of liability; or

         (c)      to bodily injury or property damage resulting directly or
                  indirectly from the nuclear energy hazard arising from:

                  (1)      the ownership, maintenance, operation or use of a
                           nuclear facility by or on behalf of an Insured;

                  (2)      the furnishing by an Insured of services, materials,
                           parts or equipment in connection with the planning,
                           construction, maintenance, operation or use of any
                           nuclear facility; and

                                                                     Page 1 of 2
<PAGE>

                  (3)      The possession, consumption, use, handling, disposal
                           or transportation of fissionable substances or of
                           other radioactive material (except radioactive
                           isotopes, away from a nuclear facility, which have
                           reached the final stage of fabrication so as to be
                           useable for any scientific, medical, agricultural,
                           commercial or industrial purpose) used, distributed,
                           handled or sold by an Insured.

As used in this Policy:

                  (I)      The term "nuclear energy hazard" means the
                           radioactive, toxic, explosive or other hazardous
                           properties of radioactive material;

                  (II)     The term "radioactive material" means uranium,
                           thorium, plutonium, neptunium, their respective
                           derivatives and compounds, radioactive isotopes of
                           other elements and any other substances that the
                           Atomic Energy Control Board may, by regulation,
                           designate as being prescribed substances capable of
                           releasing atomic energy, or as being requisite for
                           the production, use or application of atomic energy;

                  (III)    The term "nuclear facility" means:

                           (a)      any apparatus designed or used to sustain
                                    nuclear fission in a self-supporting chain
                                    reaction or to contain a critical mass of
                                    plutonium, thorium and uranium or any one or
                                    more of them;

                           (b)      any equipment or device designed or used for
                                    (i) separating the isotopes of plutonium,
                                    thorium and uranium or any one or more of
                                    them, (ii) processing or utilizing spent
                                    fuel, or (iii) handling, processing or
                                    packaging waste;

                           (c)      any equipment or device used for the
                                    processing, fabricating or alloying of
                                    plutonium, thorium or uranium enriched in
                                    the isotope uranium 233 or in the isotope
                                    uranium 235, or any one or more of them if
                                    at any time the total amount of such
                                    material in the custody of the Insured at
                                    the premises where such equipment or device
                                    is located consists of or contains more than
                                    25 grams of plutonium or uranium 233 or any
                                    combination thereof, or more than 250 grams
                                    of uranium 235;

                           (d)      any structure, basin, excavation, premises
                                    or place prepared or used for the storage or
                                    disposal of waste radioactive material;

                           and includes the site on which any of the foregoing
                           is located, together with all operations conducted
                           thereon and all premises used for such operations.

                  (IV)     The term "fissionable substance" means any prescribed
                           substance that is, or from which can be obtained, a
                           substance capable of releasing atomic energy by
                           nuclear fission.

                  (V)      With respect to property, loss of use of such
                           property shall be deemed to be property damage.

N.M.A. 1979

                                                                     Page 2 of 2
<PAGE>

           NUCLEAR ENERGY RISKS EXCLUSION CLAUSE (REINSURANCE) (1994)

                      (WORLDWIDE EXCLUDING U.S.A. & CANADA)

This agreement shall exclude Nuclear Energy Risks whether such risks are written
directly and/or by way of reinsurance and/or via Pools and/or Associations.

For all purposes of this agreement Nuclear Energy Risks shall mean all first
party and/or third party insurances or reinsurances (other than Workers'
Compensation and Employers' Liability) in respect of:-

      (I)   All PROPERTY on the site of a nuclear power station.

            NUCLEAR REACTORS, reactor buildings and plant and equipment therein
            on any site other than a nuclear power station.

      (II)  All PROPERTY, on any site (including but not limited to the sites
            referred to in (I) above) used or having been used for:-

            (a)   The generation of nuclear energy; or

            (b)   The PRODUCTION, USE OR STORAGE OF NUCLEAR MATERIAL.

      (III) Any other PROPERTY eligible for insurance by the relevant local
            Nuclear Insurance Pool and/or Association but only to the extent of
            the requirements of that local Pool and/or Association.

      (IV)  The supply of goods and services to any of the sites, described in
            (I) to (III) above, unless such insurances or reinsurances shall
            exclude the perils of irradiation and contamination by NUCLEAR
            MATERIAL.

Except as undernoted, Nuclear Energy Risks shall not include:-

      (i)   Any insurance or reinsurance in respect of the construction or
            erection or installation or replacement or repair or maintenance or
            decommissioning of PROPERTY as described in (I) to (III) above
            (including contractors' plant and equipment);

      (ii)  Any Machinery Breakdown or other Engineering insurance or
            reinsurance not coming within the scope of (i) above;

Provided always that such insurance or reinsurance shall exclude the perils of
irradiation and contamination by NUCLEAR MATERIAL.

However, the above exemption shall not extend to:-

      (1)   The provision of any insurance or reinsurance whatsoever in respect
            of:-

            (a)   NUCLEAR MATERIAL;

            (b)   Any PROPERTY in the HIGH RADIOACTIVITY ZONE OR AREA of any
                  NUCLEAR INSTALLATION as from the introduction of NUCLEAR
                  MATERIAL or - for reactor installations - as from fuel loading
                  or first criticality where so agreed with the relevant local
                  Nuclear Insurance Pool and/or Association.

      (2)   The provision of any insurance or reinsurance for the undernoted
            perils:-

            -     Fire, lightning, explosion;

            -     Earthquake;

            -     Aircraft and other aerial devices or articles dropped
                  therefrom;

            -     Irradiation and radioactive contamination;

            -     Any other peril insured by the relevant local Nuclear
                  Insurance Pool and/or Association;

            in respect of any other PROPERTY not specified in (1) above which
            directly involves the PRODUCTION, USE OR STORAGE OF NUCLEAR MATERIAL
            as from the introduction of NUCLEAR MATERIAL into such PROPERTY.

                                                                     Page 1 of 2
<PAGE>

DEFINITIONS:

      "NUCLEAR MATERIAL" means:-

            (i)   Nuclear fuel, other than natural uranium and depleted uranium,
                  capable of producing energy by a self-sustaining chain process
                  of nuclear fission outside a NUCLEAR REACTOR, either alone or
                  in combination with some other material; and

            (ii)  RADIOACTIVE PRODUCTS OR WASTE.

      "RADIOACTIVE PRODUCTS OR WASTE" means any radioactive material produced
      in, or any material made radioactive by exposure to the radiation
      incidental to the production or utilization of nuclear fuel, but does not
      include radioisotopes which have reached the final stage of fabrication so
      as to be usable for any scientific, medical, agricultural, commercial or
      industrial purpose.

      "NUCLEAR INSTALLATION" means:-

            (i)   Any NUCLEAR REACTOR;

            (ii)  Any factory using nuclear fuel for the production of NUCLEAR
                  MATERIAL, or any factory for the processing of NUCLEAR
                  MATERIAL, including any factory for the reprocessing of
                  irradiated nuclear fuel; and

            (iii) Any facility where NUCLEAR MATERIAL is stored, other than
                  storage incidental to the carriage of such material.

      "NUCLEAR REACTOR" means any structure containing nuclear fuel in such an
      arrangement that a self-sustaining chain process of nuclear fission can
      occur therein without an additional source of neutrons.

      "PRODUCTION, USE OR STORAGE OF NUCLEAR MATERIAL" means the production,
      manufacture, enrichment, conditioning, processing, reprocessing, use,
      storage, handling and disposal of NUCLEAR MATERIAL.

      "PROPERTY" shall mean all land, buildings, structures, plant, equipment,
      vehicles, contents (including but not limited to liquids and gases) and
      all materials of whatever description whether fixed or not.

      "HIGH RADIOACTIVITY ZONE OR AREA" means:-

            (i)   For nuclear power stations and NUCLEAR REACTORS, the vessel or
                  structure which immediately contains the core (including its
                  supports and shrouding) and all the contents thereof, the fuel
                  elements, the control rods and the irradiated fuel store; and

            (ii)  For non-reactor NUCLEAR INSTALLATIONS, any area where the
                  level of radioactivity requires the provision of a biological
                  shield.

N.M.A. 1975(a)

                                                                     Page 2 of 2

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