Document:

Exhibit
10.9

BROKERAGE BUSINESS
POOLING AGREEMENT

This Brokerage Business Pooling Agreement (“Pooling Agreement”) by and
between Tower Insurance Company of New York (“TICNY”), an insurance company
domiciled in New York and CastlePoint Insurance Company (“CPIC”), an insurance
company domiciled in New York, is made effective as of 12:01 a.m., January 1,
2007,  (the “Effective Date”).

WHEREAS, TICNY and CPIC are each authorized to transact, and do transact, a
multiple line property and casualty insurance business; and

WHEREAS, TICNY, and CPIC desire to pool their respective Brokerage Business
(defined below) in order to make more efficient use of available surplus and
achieve other operating efficiencies; and

WHEREAS, TICNY will act as the manager of such pool pursuant to a separate Pool
Management Agreement, attached hereto as Exhibit A;

NOW, THEREFORE, for mutual considerations, the sufficiency
and receipt of which is hereby acknowledged, TICNY and CPIC agree as follows:

ARTICLE
I                    Definitions

In addition to the terms defined elsewhere in this Agreement, the
following terms, whenever used herein, shall have the following meanings:

“Brokerage Business” shall mean broad classes of business that are
underwritten on an individual policy basis by an insurance company’s
underwriting staff through wholesale and retail agents, and for which most or
all of the services are provided by the insurance company as part of the
overall product offering.

“Brokerage
Business Pool” shall mean Brokerage Business written by or on behalf of the
Participating Companies or assumed by a Participating Company (including such
business assumed by TICNY from its affiliates), that is pooled and allocated to
each of the Participating Companies based upon their Pooling Percentage as set
forth in this Pooling Agreement.

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“Existing Reinsurance” shall mean reinsurance ceded by a Participating
Company that is in effect on the Effective Date, to the extent that such
reinsurance relates to the Brokerage Business of such Participating Company.

“Management
Fees” shall mean the management fees payable by CPIC to TICNY pursuant to the
Pool Management Agreement.

“Net
Liability” shall mean the loss and loss adjustment expense liability remaining
after the application of Existing Reinsurance and, with respect to TICNY, Pool
Reinsurance, in each case to the extent collectible; provided, however,
that “Net Liability” shall not include liability with respect to losses and
loss adjustment expenses incurred prior to the Effective Date.

“Net Loss Ratio” shall mean, for any period of time, the ratio of Net
Losses and loss adjustment expenses incurred during such period to Net Premium
Earned for such period.

“Net
Losses” shall mean, for any period of time, any and all amounts that a
Participating Company is required to pay to or on behalf of insureds for
insurance claims made under its Policies, after the application of any
applicable reinsurance but not including loss adjustment expenses.

“Net Premium Earned” shall mean, for any period of time, the earned
portion of premiums written by a Participating Company after payment for
reinsurance, if any.

“Net
Written Premium” shall mean direct premium written on the Policies covered by
this Agreement plus additions, less refunds and return premium for
cancellations and reductions (but not dividends) and less premium paid or
payable for reinsurance that inures to the benefit of the Participating
Companies.

“Participating
Companies” shall mean TICNY and CPIC.

“Policies”
shall mean all policies, certificates, binders, contracts and agreements of
insurance covering Brokerage Business issued or renewed on or after the
Effective Date by or on behalf of TICNY or CPIC, as the case may be, all of
which shall be subject to this Pooling Agreement. “Policies” shall be comprised
of all lines of business that are written as Brokerage Business.

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“Pool
Reinsurance” shall mean property catastrophe and excess of loss reinsurance
ceded by TICNY to an insurer that is not a Participating Company and that
inures to the benefit of the Brokerage Business Pool.

“Pooling
Percentages” shall be those percentages set forth on Schedule 1 attached, as
amended from time to time.

ARTICLE II                  Cessions to Brokerage Business
Pool

CPIC shall automatically and obligatorily cede to TICNY as reinsurance,
and TICNY shall be obligated to accept as assumed reinsurance, one hundred
percent (100%) of the premiums and Net Liabilities with respect to Policies
issued or assumed by CPIC, to be combined with the premiums and Net Liabilities
of TICNY under Policies issued or assumed by TICNY, provided, however, that the
total gross written premium of CPIC after pooling shall not exceed $150 million
for the first twelve (12) month period ending March 31, 2007,  subject to a growth factor of 25% per each
twelve (12) month period thereafter, unless agreed otherwise by the parties.

ARTICLE
III                 Participation in Brokerage
Business Pool

TICNY shall establish the Brokerage Business Pool, which shall consist
of the premiums and Net Liability under all Brokerage Business written or
assumed by TICNY and CPIC (including business assumed by TICNY pursuant to this
Pooling Agreement).  TICNY shall
automatically and obligatorily cede to CPIC, and retain for TICNY’s own
account, the applicable Pooling Percentages, as set forth in Schedule 1 hereto,
as amended from time to time, of such Net Liability and CPIC shall
automatically and obligatorily accept such cessions.  Notwithstanding the foregoing, if TICNY (i)
writes business of the type that it has historically not written or (ii) writes
more than 25% of its gross written premiums outside the State of New York in
any 12 month period ending on the anniversary date of this Pooling Agreement,
then such non-historical business and the excess of business not in New York
over 25% may, at CPIC’s discretion, be excluded from the pool. In addition, the
pool shall exclude any property excess of loss liabilities over $10 million
resulting from any one occurrence.  TICNY’s
and CPIC’s share shall be as set

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forth
on Schedule 1 hereto, as amended from time to time. Such Pooling Percentages
shall be applied to all Brokerage Business written by the Participating
Companies.  Any change in the Pooling
Percentages shall be made only by a written amendment to Schedule 1 of this
Pooling Agreement signed by the parties hereto or as otherwise set forth in
Article XVI of this Pooling Agreement. 
The Participating Companies acknowledge that, following the acceptance
or retention of a percentage of the Brokerage Business Pool by a Participating
Company, such pooled business shall be subject to such reinsurance as may be
entered into by such Participating Company on or after the Effective Date that
is for the benefit of such Participating Company as to its participation in the
Brokerage Business Pool and does not inure to the benefit of the Brokerage
Business Pool.

ARTICLE IV                 Reinsurance

TICNY, as pool manager, shall negotiate, obtain and maintain such Pool
Reinsurance as it deems appropriate with respect to the liabilities of the
Brokerage Business Pool, which reinsurance shall inure to the benefit of the
Participating Companies according to their respective Pooling Percentages.
TICNY shall purchase property and casualty excess of loss reinsurance and
property catastrophe excess of loss reinsurance from third party reinsurers to
protect the net exposure of the Participating Companies. The property
catastrophe excess of loss reinsurance purchased by TICNY may provide for up to
approximately 10% of the combined surplus of TICNY and CPIC to be retained by
the pool prior to reinsurance by third party reinsurance companies (“Pooled
Retention”). CPIC also shall have the right, in its discretion, to require
TICNY to increase the Pooled Retention by an additional amount of up to 10% of
the surplus of CastlePoint Reinsurance Company, Ltd. (“CPRe”) with such
additional reinsurance to be purchased from CPRe.

For the period beginning April 1, 2006 and ending March 31, 2007, the
premiums pooled shall not be reduced by TICNY’s property catastrophe premiums
ceded and the losses pooled shall include TICNY’s property catastrophe actual
incurred losses up to a maximum of $15,000,000 times CPIC’s pooling
percentage.  For the period beginning
April 1, 2007 the amount of property catastrophe premiums

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ceded
that will be paid by CPIC shall be the total amount of property catastrophe
premiums ceded by the brokerage pool times CPIC’s pooling percentage. .  For the period beginning April 1, 2007 the
amount of property catastrophe losses incurred that will be paid by CPIC shall
be the total amount of property catastrophe losses actually incurred within the
property catastrophe deductible for the brokerage pool times CPIC’s pooling
percentage..  The total amount of
property catastrophe premiums ceded and the total amount of property
catastrophe incurred losses paid by TICNY shall be the total amount of property
catastrophe premiums ceded and incurred losses for the total brokerage pool
less the amounts paid by CPIC as defined above.

ARTICLE V          Losses and Loss
Adjustment Expenses

A.        All loss settlements made by TICNY with
regards to the Brokerage Business, whether under strict policy conditions or by
way of compromise, shall be unconditionally binding upon CPIC.

B.        Each Participating Company shall be liable
for its percentage share per Schedule 1 of loss adjustment expenses incurred
under or in connection with the Policies and shall be credited with its
percentage share per Schedule 1 of any recoveries of such expense.

C.        If a Participating Company pays or is held
liable to pay any punitive, exemplary, compensatory, or consequential damages
(hereinafter called “Extra Contractual Obligations”) because of alleged or
actual negligence on its part in handling a claim under a Policy, one hundred
percent (100%) of such Extra Contractual Obligations (to the extent permitted
by law) shall be added to the Net Liability, if any, of such Participating
Company under the Policy involved, and the sum thereof shall be subject to this
Pooling Agreement; provided, however, that no such payment of Extra Contractual
Obligations shall be permitted if such payment is contrary to New York law.

D.        If a Participating Company pays or is held
liable to pay in connection with any loss amounts in excess of the limit of its
original Policy, such loss in excess of that limit having been incurred because
of its failure to settle within the Policy limit or by reason of alleged or
actual negligence in rejecting an offer of settlement or in the preparation of
the defense or in the trial of any action against the

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original
insured or reinsured or in the preparation or prosecution of an appeal
consequent upon such action (hereinafter called an “Excess of Policy Limits
Loss”), one hundred percent (100%) of such Excess of Policy Limits Loss (to the
extent permitted by law) shall be added to the Net Liability, if any, of such
Participating Company under the Policy involved, and the sum thereof shall be
subject to this Pooling Agreement.

ARTICLE
VI                 Salvage and Subrogation

Each of the Participating
Companies shall be credited with its proportionate share of salvage and
subrogation on account of losses under the Policies.

ARTICLE VII               Original Conditions Apply

All reinsurance under this Pooling Agreement shall be subject to the
same rates, terms, conditions and waivers, and to the same modifications and
alterations as the respective Policies. 
Each of the Participating Companies shall be credited with the
proportion equal to its Pooling Percentage of the original premiums received
under the Policies issued on or after the Effective Date, but after deduction
of premiums, if any, ceded under Existing Reinsurance and Pool Reinsurance.

ARTICLE VIII              Ceding Commission

Each of the Participating
Companies shall be charged with a ceding commission in an amount equal to such
Participating Company’s Pooling Percentage of actual commissions paid to agents
or brokers, premium taxes, guarantee fund assessments, fees and assessments for
boards, bureaus and associations, fees and assessments for industry and
residual markets, and other similar expenses incurred by the Participating
Companies on all premiums ceded hereunder, but after deduction of ceding
commissions or expense reimbursement amounts recovered under Existing
Reinsurance and Pool Reinsurance.

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ARTICLE
IX                 Remittances and Reports

A.        As soon as practicable consistent with its
standard financial reporting practices, but no later than thirty (30) days
after the end of each calendar month, TICNY shall submit a pooling report to
CPIC setting forth the following information as regards the Brokerage Business
Pool:

1.     Net Written Premium received during the month;

2.     Net Premium Earned received during the month

3.     Ceding commission thereon;

4.     Losses and loss adjustment expenses paid during the month;

5.     Salvage and subrogation recoveries received;

6.     Recoverables under inuring reinsurance; and

7.     Management Fees due under the Pool Management Agreement.

B.        The balance shown to be due a Participating
Company shall be remitted within fifteen (15) days after the issuance of the
reports by TICNY on a collected basis; provided that TICNY may retain, as
manager, a reserve out of amounts otherwise due CPIC for the payment of amounts
reasonably estimated by TICNY to be payable during the next sixty (60) days by
the Brokerage Business Pool and allocable to CPIC hereunder.  Such balance shall be remitted in cash or in
readily marketable securities (valued at fair market value) in an amount equal
to such balance.  Should discrepancies
arise in the process of the verification of any report, such differences, once
resolved, should be remitted promptly.

C.        As soon as practicable consistent with its
financial reporting practices, but no later than thirty (30) days after the end
of each calendar quarter, TICNY shall report to CPIC ceded unearned premium
reserves and ceded outstanding loss and loss adjustment expense reserves as
regards the Brokerage Business as of the end of such quarter.

ARTICLE X                  Offset

Each of the Participating
Companies shall have and may exercise at any time, and from time to time, the
right to offset any balance or balances whether on account of premiums, losses
or amounts otherwise due from one Participating Company to the other under the
terms of this Pooling Agreement, subject to the provision of applicable law,
and as specifically permitted by Sections 1308 and 7427 of the New York Insurance
Law.

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ARTICLE XI                 Errors and Omissions

Inadvertent delays, errors or omissions made in connection with this
Pooling Agreement or any transaction hereunder shall not relieve any
Participating Company from any liability that would have attached had such
delay, error or omission not occurred, provided always that such error or
omission will be rectified as soon as possible after discovery.

ARTICLE XII               Access to Records

The files and records of each Participating Company with respect to
this Pooling Agreement and the Brokerage Business subject hereto shall be open
to examination by any officer or director of each of the other Participating
Companies or their duly authorized representatives during normal business
hours.

ARTICLE XIII              Term

A.        This Pooling Agreement will become effective
on the Effective Date.  A Participating
Company may terminate its respective participation in the Brokerage Business
Pool as of the date that is forty-eight (48) months after the Effective Date.
and thereafter as of the close of a calendar quarter by giving at least six (6)
months prior written notice to the other party by certified or registered mail.

B.        CPIC shall have the right to terminate its
participation in the Brokerage Business Pool at any time on or after twenty
four (24) months after the Effective Date and thereafter by giving sixty (60)
days prior written notice by certified or registered mail to TICNY if the sum
of the cumulative Net Loss Ratio for the Brokerage Business Pool plus the
Management Fee Percentage (as defined in Article XIV) equals or exceeds 99 %
for the period from the Effective Date to the end of the calendar quarter
immediately preceding the date of such notice. If the Participating Companies
cannot agree as to the calculation of the Net Loss Ratio or Management Fee
Percentage, within 30 days of receiving the appropriate report, the calculation
shall be arbitrated. The actuarial firm of Towers Perrin shall furnish an
arbiter for TICNY, and CPIC will choose another actuarial firm to furnish its
arbiter. Those two arbiters will select a third independent actuarial firm to
furnish the third arbiter.

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C.        Notwithstanding paragraphs A and B above,
this Pooling Agreement may be terminated immediately with respect to new or
renewal business (a) at any time by mutual consent in writing by each of the
Participating Companies or (b) as of the close of a calendar quarter, upon
not less than sixty (60) days prior written notice by a Participating Company
to the other Participating Companies of such Participating Company’s exercise
of its right to terminate its participation in the Brokerage Business Pool.

D.        If this Pooling Agreement is terminated
pursuant to this Article XIII, all rights and obligations of the Participating
Companies with respect to Brokerage Business ceded pursuant to this Pooling
Agreement prior to such termination shall continue to be governed by the terms
of this Pooling Agreement.

ARTICLE XIV              Reinsurance Credit

A.        If any Participating Company is unauthorized
or otherwise unqualified in any state or other United States jurisdiction, and
if, without such security, a financial penalty to an other Participating
Company, hereinafter in this Article XIV called the “Reinsured Participating
Company”, would result on any statutory statement or report it is required to
make or file with insurance regulatory authorities or a court of law in the
event of insolvency, the Participating Company will timely secure its share of
Obligations under this Agreement in a manner, form, and amount acceptable to
the Reinsured Participating Company and to all applicable insurance regulatory
authorities in accordance with this Article.

B.        The Participating Company shall secure such
Obligations by either:

1.        Clean, irrevocable, and unconditional evergreen
letter(s) of credit (“Letter(s) of Credit”) meeting the requirements of New
York Insurance Regulation 133; and/or

2.        A trust account meeting the requirements of New
York Regulation 114.

C.        The “Obligations” referred to herein means
the then current (as of the end of each calendar quarter) sum of:

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1.        The amount of the ceded unearned premium
reserve for which the Participating Company is responsible to the Reinsured
Participating Company;

2.        The amount of Losses and Loss Adjustment
Expenses and other amounts paid by the Reinsured Participating Company for
which the Participating Company is responsible to the Reinsured Participating
Company but has not yet paid;

3.        The amount of ceded reserves for Losses and
Loss Adjustment Expenses (including, ceded reserves for losses incurred but not
reported) for which the Participating Company is responsible to the Reinsured
Participating Company; and

4.        The amount of return and refund premiums paid
by the Reinsured Participating Company for which the Participating Company is
responsible to the Reinsured Participating Company but has not yet paid.

D.        To the extent that the Participating Company
elects to provide Letter(s) of Credit, the following shall apply:

1.        Each Letter of Credit 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 Reinsured
Participating Company not less than 30 days prior to said expiration date.

2.        The Letter of Credit must be issued or
confirmed by a bank which is authorized to issue letters of credit, which is
either a member of the Federal Reserve System or is a New York State chartered
bank, and which in all other respects satisfies the definition of a “Qualified
Bank” under Section 79.1(e) of New York Insurance Regulation 133.  If the Letter of Credit is issued by a bank
authorized to issue letters of credit but which is not such a “Qualified Bank”,
then the Letter of Credit must be confirmed by such a bank and the Letter of
Credit must meet all of the conditions set forth in Section 79.4 of New York
Insurance Regulation 133.

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3.        The Participating Company and the Reinsured
Participating Company agree that the Reinsured Participating Company may draw
upon the Letter(s) of Credit at any time, notwithstanding any other provisions
in the Agreement, provided such assets are applied and utilized by the
Reinsured Participating Company or any successor of the Reinsured Participating
Company by operation of law, including, without limitation, any liquidator,
rehabilitator, receiver or conservator of the Reinsured Participating Company,
without diminution because of the insolvency of the Reinsured Participating
Company or the Participating Company, only for the following purposes:

(i)            to reimburse the Reinsured Participating
Company for the Participating Company’s share of premiums returned to the
owners of policies reinsured under this Agreement on account of cancellations
of such policies;

(ii)           to reimburse the Reinsured Participating
Company for the Participating Company’s share of surrenders and benefits or
losses paid by the Reinsured Participating Company under the terms and
provisions of the policies reinsured under this Agreement;

(iii)          to fund an account with the Reinsured
Participating Company in an amount at least equal to the deduction, for
reinsurance ceded, from the Reinsured Participating Company’s liabilities for
policies ceded under this Agreement. 
Such amount shall include, but not be limited to, amounts for policy
reserves for claims and losses incurred (including losses incurred but not
reported), loss adjustment expenses, and unearned premiums; and

(iv)          to pay any other amounts the Reinsured
Participating Company claims are due under this Agreement.

4.           the
Reinsured Participating Company shall immediately return to the Participating
Company any amounts drawn down on the Letter of Credit that are subsequently
determined not to be due.

5.        The issuing bank shall have no responsibility whatsoever
in connection with the propriety of withdrawals made by the Reinsured
Participating Company of the disposition of funds

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withdrawn, except to ensure that withdrawals are made only upon the
order of properly authorized representatives of the Reinsured Participating
Company.

E.         To the extent that the Participating Company
elects to establish a trust account, the following shall apply.

1.        It is agreed that the Participating Company
shall enter into a trust agreement (the “Trust Agreement”) in a form acceptable
to the Reinsured Participating Company and establish a trust account (the “Trust
Account”) for the sole benefit of the Reinsured Participating Company with a
trustee (the “Trustee”), which shall be at the time the Trust is established,
and shall continue to be, either a member of the Federal Reserve System or a
New York state chartered bank and which shall not be a parent, subsidiary or
affiliate of the Participating Company or the Reinsured Participating Company.

2.        The Participating Company agrees to deposit and
maintain in said Trust Account assets to be held in trust by the Trustee for
the benefit of the Reinsured Participating Company as security for the payment
of the Participating Company’s Obligations to the Reinsured Participating
Company under the Agreement.  Such assets
shall be maintained in the Trust Account by the Participating Company as long
as the Participating Company continues to remain liable for such Obligations.

3.        The Participating Company agrees that the
assets deposited into the Trust Account shall be valued according to their
current fair market value and shall consist only of currency of the United States
of America, certificates of deposit issued by a United States bank and payable
in United States legal tender, and investments of the types specified in
paragraphs (1), (2), (3), (8) and (10) of Section 1404(a) of the New York
Insurance Law, provided such investments are issued by an institution that is
not the parent, subsidiary or affiliate of either the Grantor or the
Beneficiary (“Authorized Investments”).

4.        The Participating Company, prior to depositing
assets with the Trustee, shall execute all assignments and endorsements in
blank, and shall transfer legal title to the Trustee of all shares, obligations
or any other assets requiring assignments, in order that the Reinsured
Participating Company,

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or the Trustee upon direction of the Reinsured Participating Company,
may whenever necessary negotiate any such assets without consent or signature
from the Participating Company or any other entity.

5.        All settlements of account under the Trust
Agreement between the Reinsured Participating Company and Participating Company
shall be made in cash or its equivalent.

6.        The Participating Company and the Reinsured
Participating Company agree that the assets in the Trust Account may be
withdrawn by the Reinsured Participating Company at any time, notwithstanding
any other provisions in the Agreement, provided such assets are applied and
utilized by the Reinsured Participating Company or any successor of the
Reinsured Participating Company by operation of law, including, without
limitation, any liquidator, rehabilitator, receiver or conservator of the
Reinsured Participating Company, without diminution because of the insolvency
of the Reinsured Participating Company or the Participating Company, only for
the following purposes:

(i)            to reimburse the Reinsured Participating
Company for the Participating Company’s share of any Losses and Loss Adjustment
Expenses paid by the Reinsured Participating Company but not received from the
Participating Company or for unearned premiums due to the Reinsured
Participating Company but not otherwise paid by the Participating Company under
the Agreement; or

(ii)           to make payment to the Participating Company
of any amounts held in the Trust Account that exceed 102% of the Participating
Company’s Obligations (less the balance of credit available under any Letter(s)
of Credit) hereunder; or

(iii)          where the Reinsured Participating Company has
received notification of termination of the Trust Account, and where the
Participating Company’s entire Obligations under the Agreement remain unliquidated
and undischarged ten (10) days prior to such termination, to withdraw amounts
equal to such Obligations (less the balance of credit available under any
Letter(s) of Credit) and deposit such amounts in a separate account, in the
name of the Reinsured Participating Company, in any United States bank or trust
company, apart from its general assets, in trust for such uses and purposes

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specified in sub-paragraphs (i) and (ii) above as may remain executory
after such withdrawal and for any period after such termination.

7.        The Participating Company shall have the right
to seek the Reinsured Participating Company’s approval to withdraw all or any
part of the assets from the Trust Account and transfer such assets to the
Participating Company, provided that the withdrawal conforms to the following
requirements:

(i)            the Participating Company shall, at the
time of withdrawal, replace the withdrawn assets with other Authorized
Investments having a market value equal to the market value of the assets
withdrawn,

(ii)           after such withdrawal and transfer, the
market value of the Trust Account is no less than 102% of the Participating
Company’s Obligations (less the balance of credit available under any Letter(s)
of Credit).

In the event that the
Participating Company seeks the Reinsured Participating Company’s approval
hereunder, the Reinsured Participating Company shall not unreasonably or
arbitrarily withhold its approval.

8.        In the event that the Reinsured Participating
Company withdraws assets from the Trust Account for the purposes set forth in
Paragraph (6)(i) above in excess of actual amounts required to meet the
Participating Company’s Obligations to the Reinsured Participating Company
(less the balance of credit available under any Letter(s) of Credit), or in excess
of amounts determined to be due and under Paragraph (6)(iii) above, the
Reinsured Participating Company will return such excess to the Participating
Company.

9.           The
Reinsured Participating Company will prepare and forward at annual intervals or
more frequently as determined by the Reinsured Participating Company, but not
more frequently than quarterly to the Participating Company a statement for the
purposes of this Article, showing the Participating Company’s share of
Obligations as set forth above.  If the
Participating Company’s share

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thereof exceeds the then existing balance of the security provided, the
Participating Company will, within fifteen (15) days of receipt of the
Reinsured Participating Company’s statement, but never later than December 31
of any year, increase the amount of the letter of credit, or Trust Account to
the required amount of the Participating Company’s share of Obligations set
forth in the Reinsured Participating Company’s statement, but never later than
December 31 of any year.  If the then
existing balance of the security provided exceeds an amount equal to 102% of
the Participating Company’s share thereof, the Reinsured Participating Company
will release the excess amount over 102% to the Participating Company upon the
Participating Company’s written request.

F.             The Participating Company will take any other
reasonable steps that may be required for the Reinsured Participating Company
to take full credit on its statutory financial statements for the reinsurance
provided by this Agreement.

ARTICLE XV               Amendments 

This Pooling Agreement may be amended only if
in writing and signed by each Participating Company.

ARTICLE XVI              Adjustments to Participation

TICNY may, in its sole discretion, change the Pooling Percentages set
forth on Schedule 1 effective as of the date that is six (6) months following
the Effective Date and, from time to time, as of any six (6) month anniversary
of the Effective Date thereafter, upon not less thirty (30) days prior written
notice to the other Participating Company, unless such notice is waived by the
other Participating Company, so long as the Pooling Percentage of CPIC shall at
all times during the term of this Pooling Agreement be a minimum of 25% and a
maximum of 45%, and provided, however, that the Pool Manager and the other
Participating Company may agree to change the pool participations as of any
calendar quarter, and, in such case, upon mutual agreement, the pooling
percentage of CPIC may be as low as 15%; and provided further, however, that
the total gross written premium of CPIC assumed under this Pooling Agreement
shall not exceed $150 million for the twelve (12) month period ending March 31,

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2007, subject to a growth factor of 25% per
twelve (12) month period ending March 31, thereafter, unless otherwise agreed
by the parties. Each such change shall apply to Policies issued or renewed
after the effective date of such change. 
Schedule 1 shall be revised to reflect all such changes and the effective
date of each such change. If the maximum gross written premium after pooling is
attained in any twelve (12) month period ending March 31 as set forth herein,
unless as otherwise agreed as set forth above, then the Pooling Percentage,
which shall apply to all premiums and losses on a pro-rated basis for such
period, of CPIC shall be decreased for that twelve (12) month period, even if
such Pooling Percentage is below 25%.

ARTICLE XVII            Investments

The investments of the Participating
Companies and any income, gains or losses derived therefrom and expenses
related thereto, are not part of, nor are they subject to the terms of, this
Pooling Agreement.

ARTICLE XVIII           Insolvency

A.        In the event of the insolvency or the
appointment of a liquidator, receiver or other statutory successor of a
Participating Company, any amount due such Participating Company as a ceding
party shall be payable by the accepting party on the basis of the liability of
the ceding party under the Policies reinsured without diminution because of the
insolvency of the ceding party.  Payments
by the accepting party shall be made directly to the ceding party or to the
liquidator, receiver or statutory successor, except (a) where any Policy
specifically provides another payee of such reinsurance in the event of the
insolvency of the ceding party, or (b) where the accepting party, with the
consent of the direct insured or insureds, has assumed such Policy obligations
of the ceding party as direct obligations of the accepting party to payees
under such Policies and in substitution for the obligations of the ceding party
to such payees.

B.        The liquidator or receiver or statutory
successor of the ceding party shall give written notice to the accepting party
of the pendency of any claim against the insolvent ceding party on the

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Policies
reinsured within a reasonable time after such claim is filed in the insolvency
proceeding.  During the pendency of such
claim, the accepting party may investigate the claim and interpose in the
proceeding where the claim is to be adjudicated, at its own expense, any
defense or defenses which it may deem available to the ceding party or its
liquidator or receiver or statutory successor. 
The expenses thus incurred by the accepting party shall be chargeable,
subject to court approval, against the insolvent ceding party solely as a
result of the defense undertaken by the accepting party.

ARTICLE XIX              Arbitration

A.        As a condition precedent to any right of
action hereunder, in the event of any dispute or difference of opinion
hereafter arising with respect to this Pooling Agreement (except as set forth
in Article XIII - Term), it is hereby mutually agreed that such dispute
or difference of opinion shall be submitted to arbitration.  One Arbiter shall be chosen by each
Participating Company that is a party to such dispute and an Umpire shall be
chosen by the Arbiters before they enter upon arbitration, all of whom shall be
active or retired disinterested executive officers of insurance or reinsurance
companies or Underwriters at Lloyd’s of London. 
In the event that a Participating Company should fail to choose an
Arbiter within thirty (30) days following a written request by another
Participating Company to do so, the requesting Participating Company’s Arbiter
shall choose a second arbiter before entering upon arbitration.  If the two arbitrators are unable to agree
upon the third arbitrator within thirty (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 United States District Court having
jurisdiction over the geographical area in which the arbitration is to take
place, or if that court declines to act, the state court having general
jurisdiction in such area.

B.        Participating Companies party to the dispute
shall present their case to the Arbiters within thirty (30) days following the
date of appointment of the Umpire.  The
Arbiters shall consider this Pooling Agreement as an honorable engagement
rather than merely as a legal obligation and they are relieved of all judicial
formalities and may abstain from following the strict rules of law.  The decision of

 17
 

the
Arbiters shall be final and binding on all Participating Companies; but failing
to agree, they shall call in the Umpire and the decision of the majority shall
be final and binding upon all parties. 
Judgment upon the final decision of the Arbiters may be entered in any
court of competent jurisdiction.

C.        Each Participating Company that is a party to
the dispute shall bear the expense of its own Arbiter, and shall jointly and
equally bear with the other the expense of the Umpire and of the
arbitration.  In the event that the two
Arbiters are chosen by the requesting Participating Company, as above provided,
the expense of the Arbiters, the Umpire and the arbitration shall be equally
divided between the Participating Companies that are parties to the
arbitration.

ARTICLE XX               Miscellaneous Provisions

A.        Headings used herein are not a part of this
Pooling Agreement and shall not affect the terms hereof.

B.        All notices, requests, demands and other
communications under this Pooling Agreement must be in writing and will be
deemed to have been duly given or made as follows:  (a) if sent by registered or certified mail
in the United States return receipt requested, upon receipt; (b) if sent by
reputable overnight air courier, two business days after mailing; (c) if sent
by facsimile transmission, with a copy mailed on the same day in the manner
provided in (a) or (b) above, when transmitted and receipt is confirmed by
telephone; or (d) if otherwise actually personally delivered, when delivered.

C.        This Pooling Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors,
permitted assigns and legal representatives. 
Neither this Pooling Agreement, nor any right or obligation hereunder,
may be assigned by any party without the prior written consent of the other
party hereto.

D.        This Pooling Agreement may be executed by the
parties hereto in any number of counterparts, and by each of the parties hereto
in separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

 18
 

E.         This Pooling Agreement will be construed,
performed and enforced in accordance with the laws of the State of New York
without giving effect to its principles or rules of conflict of laws thereof to
the extent such principles or rules would require or permit the application of
the laws of another jurisdiction.

F.         This Pooling Agreement constitutes the entire
agreement between the parties hereto relating to the subject matter hereof and
supersedes all prior and contemporaneous agreements, understandings,
statements, representations and warranties, negotiations and discussions,
whether oral or written, of the parties and there are no general or specific
warranties, representations or other agreements by or among the parties in
connection with the entering into of this Pooling Agreement or the subject
matter hereof except as specifically set forth or contemplated herein. If any
provision of this Pooling Agreement is held to be void or unenforceable, in
whole or in part, (i) such holding shall not affect the validity and
enforceability of the remainder of this Pooling Agreement, including any other
provision, paragraph or subparagraph, and (ii) the parties agree to
attempt in good faith to reform such void or unenforceable provision to the
extent necessary to render such provision enforceable and to carry out its
original intent.

G.        No consent or waiver, express or implied, by
any party to or of any breach or default by any other party in the performance
by such other party of its obligations hereunder shall be deemed or construed
to be a consent or waiver to or of any other breach or default in the
performance of obligations hereunder by such other party hereunder.  Failure on the part of any party to complain
of any act or failure to act of any other party or to declare any other party
in default, irrespective of how long such failure continues, shall not
constitute a waiver by such first party of any of its rights hereunder.  The rights and remedies provided are
cumulative and are not exclusive of any rights or remedies that any party may otherwise
have at law or equity.

H.        Except as expressly provided for in the
insolvency provisions above, nothing in this Pooling Agreement will confer any
rights upon any person that is not a party or a successor or permitted assignee
of a party to this Pooling Agreement.

 19
 

I.          Wherever the words “include,” “includes” or “including”
are used in this Pooling Agreement, they shall be deemed to be followed by the
words “without limitation.”

J.         This Article XX shall survive the termination
of this Pooling Agreement.

IN WITNESS WHEREOF, the Participating Companies have caused
this Pooling Agreement to be executed by their duly authorized representatives,
subject to the satisfaction of New York Insurance Law § 1505, including any
conditions such regulators may impose on the terms of this Agreement subsequent
to the date hereof.

	
  

  	
  TOWER
  INSURANCE COMPANY OF NEW YORK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Francis M.
  Colalucci

  	
   

  
	
   

  	
  Name:

  	
  Francis M.
  Colalucci

  
	
   

  	
  Title:

  	
  Senior Vice
  President & Chief Financial Officer

  
	
   

  	
  Date:

  	
  January 11,
  2007

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CASTLEPOINT
  INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joel S.
  Weiner

  	
   

  
	
   

  	
  Name:

  	
  Joel S. Weiner

  
	
   

  	
  Title:

  	
  Senior Vice
  President & Chief Financial Officer

  
	
   

  	
  Date:

  	
  January 11,
  2007

  
						

 

 

 20Exhibit 10.10

TRADITIONAL
PROGRAM BUSINESS POOLING AGREEMENT

This Traditional Program Business Pooling Agreement (“Pooling Agreement”)
by and between Tower Insurance Company of New York (“TICNY”), an insurance
company domiciled in New York, and CastlePoint Insurance Company (“CPIC”), an
insurance company domiciled in New York, is made effective as of 12:01 a.m., January
1, 2007,  (the “Effective Date”).

WHEREAS, TICNY and CPIC are each authorized to transact, and do transact, a
multiple line property and casualty insurance business; and

WHEREAS, TICNY and CPIC desire to pool their respective Traditional Program
Business (defined below) in order to make more efficient use of available
surplus and achieve other operating efficiencies; and

WHEREAS, CPIC will act as the manager of such pool pursuant to a separate pool
management agreement (“Pool Management Agreement”), attached hereto as Exhibit
A;

NOW, THEREFORE, for mutual considerations, the sufficiency
and receipt of which is hereby acknowledged, TICNY and CPIC agree as follows:

ARTICLE I            Definitions

In addition to the terms defined elsewhere in this Agreement, the
following terms, whenever used herein, shall have the following meanings:

“Existing Reinsurance” shall mean reinsurance ceded by a Participating
Company that is in effect on the Effective Date, to the extent that such
reinsurance relates to the Traditional Program Business of such Participating
Company.

“Management
Fees” shall mean the management fees payable by TICNY to CPIC pursuant to the
Pool Management Agreement.

“Net
Liability” shall mean the loss and loss adjustment expense liability remaining
after the application of Existing Reinsurance and, with respect to CPIC, Pool
Reinsurance, in each case to the

 1
 

extent collectible; provided,
however, that “Net Liability” shall not include liability with respect
to losses and loss adjustment expenses incurred prior to the Effective Date.

“Net
Loss Ratio” shall mean, for any period of time, the ratio of Net Losses plus
loss adjustment expenses incurred during such period to Net Premium Earned for
such period.

“Net Losses” shall mean, for any period of time, any and all amounts
that a Participating Company is required to pay to or on behalf of insureds for
insurance claims made under its Policies, after the application of any
applicable reinsurance but not including loss adjustment expenses.

“Net Premium Earned” shall mean, for any period of time, the earned
portion of premiums written by a Participating Company after payment for
reinsurance, if any.

“Net
Written Premium” shall mean direct premium written on the Policies covered by
this Agreement plus additions, less refunds and return premium for
cancellations and reductions (but not dividends) and less premium paid or
payable for reinsurance that inures to the benefit of the Participating
Companies.

“Participating Companies” shall mean TICNY and CPIC.

“Policies”
shall mean all policies, certificates, binders, contracts and agreements of
insurance covering Traditional Program Business issued or renewed on or after
the Effective Date by or on behalf of TICNY or CPIC, as the case may be, all of
which shall be subject to this Pooling Agreement.  “Policies” shall be comprised of all lines of
business that are written as Traditional Program Business.

“Pool
Reinsurance” shall mean property catastrophe and excess of loss reinsurance
ceded by CPIC to an insurer that is not a Participating Company that inures to
the benefit of the Traditional Program Business Pool.

“Pooling
Percentages” shall be those percentages set forth on Schedule 1 attached hereto,
as amended from time to time.

“Program
Business” shall mean narrowly defined classes of business that are underwritten
on an individual policy basis by Program Underwriting Agents on behalf of
insurance companies.

 2
 

“Program Underwriting Agent” means an insurance intermediary that
aggregates business from retail and general agents and manages business on
behalf of insurance companies, including functions such as risk selection and
underwriting, premium collection, policy form design and client service.

“Traditional
Program Business Pool” shall mean Traditional Program Business written by or on
behalf of the Participating Companies or assumed by a Participating Company
(including such business assumed by TICNY from its affiliates), that is pooled
and allocated to each of the Participating Companies based upon their Pooling
Percentage as set forth in this Pooling Agreement.

“Traditional
Program Business” shall mean blocks of Program Business in excess of $5 million
in gross written premium that TICNY has historically underwritten, consisting
of non-auto related personal lines and the following commercial lines of
business: retail stores and wholesale trades, commercial and residential real
estate, restaurants, grocery stores, office and service industries, and artisan
contractors.

ARTICLE
II          Cessions to Traditional Program Business
Pool

TICNY
shall automatically and obligatorily cede to CPIC as reinsurance, and CPIC shall
be obligated to accept as assumed reinsurance, one hundred percent (100%) of
the Premium and Net Liabilities with respect to Policies issued or assumed by TICNY,
to be combined with the Premium and Net Liabilities of CPIC under Policies
issued or assumed by CPIC, provided, however, that the total gross written premium
of CPIC after pooling shall not exceed $50 million for the first 12 month
period ending March 31, 2007, subject to a growth factor of 25% per each 12
month period thereafter, unless otherwise agreed by the parties.

ARTICLE III         Participation in Traditional Program Business Pool

CPIC
shall establish the Traditional Program Business Pool, which shall consist of
the Premium and Net Liability under all Traditional Program Business written or
assumed by CPIC and TICNY (including business assumed by CPIC pursuant to this
Pooling Agreement).  CPIC shall
automatically and obligatorily cede to TICNY, and retain for CPIC’s own
account, the applicable Pooling Percentages of such Net Liability and TICNY
shall automatically and obligatorily accept such cessions. TICNY’s share

 3
 

shall be as set forth in
Schedule 1 hereto, as amended from time to time. Such Pooling Percentages shall
be applied to all Traditional Program Business written by the Participating
Companies.  Any change in the Pooling
Percentages shall be made only by a written amendment to Schedule 1 of this
Pooling Agreement signed by the parties hereto or as otherwise set forth in
Article XVI of this Pooling Agreement. 
The Participating Companies acknowledge that, following the acceptance
or retention of a percentage of the Traditional Program Business Pool by a
Participating Company, such pooled business shall be subject to such
reinsurance as may be entered into by such Participating Company on or after
the Effective Date that is for the benefit of such Participating Company as to
its participation in the Traditional Program Business Pool and does not inure
to the benefit of the Traditional Program Business Pool.

ARTICLE IV         Reinsurance

CPIC, as pool manager, shall negotiate, obtain and maintain such Pool
Reinsurance as it deems appropriate with respect to the liabilities of the Traditional
Program Business Pool, which reinsurance shall inure to the benefit of the
Participating Companies according to their respective Pooling Percentages. CPIC
shall purchase property and casualty excess of loss reinsurance and property
catastrophe excess of loss reinsurance from third party reinsurers to protect
the net exposure of the Participating Companies. The property catastrophe
excess of loss reinsurance purchased by CPIC may provide for up to
approximately 10% of the combined surplus of TICNY and CPIC to be retained by
the pool prior to reinsurance by third party reinsurance companies (“Pooled
Retention”). Any of the Participating Companies also shall have the right, in its
discretion, to require CPIC to increase the Pooled Retention by an additional
amount of up to 10% of the surplus of CastlePoint Reinsurance Company, Ltd. (“CPRe”)
with such additional reinsurance to be purchased from CPRe.

 4
 

ARTICLEV          Losses and Loss Adjustment Expenses

A.            All loss settlements made by CPIC with
regards to the Traditional Program Business, whether under strict policy
conditions or by way of compromise, shall be unconditionally binding upon TICNY.

B.            Each Participating Company shall be liable
for its percentage share per Schedule 1 of loss and loss adjustment expenses
incurred under or in connection with the Policies and shall be credited with
its percentage share per Schedule 1 of any recoveries of such expense.

C.            If a Participating Company pays or is held
liable to pay any punitive, exemplary, compensatory, or consequential damages
(hereinafter called “Extra Contractual Obligations”) because of alleged or
actual negligence on its part in handling a claim under a Policy, one hundred
percent (100%) of such Extra Contractual Obligations (to the extent permitted
by law) shall be added to the Net Liability, if any, of such Participating
Company under the Policy involved, and the sum thereof shall be subject to this
Pooling Agreement; provided, however, that no such payment of Extra Contractual
Obligations shall be permitted if such payment is contrary to New York law.

D.            If a Participating Company pays or is held
liable to pay in connection with any loss, amounts in excess of the limit of
its original Policy, such loss in excess of that limit having been incurred
because of its failure to settle within the Policy limit or by reason of
alleged or actual negligence in rejecting an offer of settlement or in the
preparation of the defense or in the trial of any action against the original
insured or reinsured or in the preparation or prosecution of an appeal
consequent upon such action (hereinafter called an “Excess of Policy Limits
Loss”), one hundred percent (100%) of such Excess of Policy Limits Loss (to the
extent permitted by law) shall be added to the Net Liability, if any, of such
Participating Company under the Policy involved, and the sum thereof shall be
subject to this Pooling Agreement.

ARTICLE VI         Salvage and Subrogation

Each of the Participating Companies shall be credited with its
proportionate share of salvage and subrogation on account of losses under the
Policies.

 5
 

ARTICLE VII       Original Conditions Apply

All
reinsurance under this Pooling Agreement shall be subject to the same rates,
terms, conditions and waivers, and to the same modifications and alterations as
the respective Policies.  Each of the
Participating Companies shall be credited with the proportion equal to its
Pooling Percentage of the original premiums received under the Policies issued
on or after the Effective Date, but after deduction of premiums, if any, ceded
under Existing Reinsurance and Pool Reinsurance.

ARTICLE
VIII      Ceding Commission

Each of the Participating Companies shall be charged with a ceding
commission in an amount equal to such Participating Company’s Pooling
Percentage of actual commissions paid to agents or brokers, premium taxes,
guarantee fund assessments, fees and assessments for boards, bureaus and
associations, fees and assessments for industry and residual markets, and other
similar expenses incurred by the Participating Companies on all premiums ceded
hereunder, but after deduction of ceding commissions or expense reimbursement
amounts recovered under Existing Reinsurance and Pool Reinsurance.

ARTICLE IX         Remittances and Reports

A.            As soon as practicable consistent with its
standard financial reporting practices, but no later than thirty (30) days
after the end of each calendar month, CPIC shall submit a pooling report to
TICNY setting forth the following information as regards the Traditional
Program Business Pool:

1.     Net Written Premium received during the month;

2.     Net
Premium Earned received during the month;

3.     Ceding commission thereon;

4.     Losses and
loss adjustment expenses paid during the month;

5.     Salvage
and subrogation recoveries received;

6.     Recoverables
under inuring reinsurance; and

7.     Expenses
paid under the Pool Management Agreement.

 6
 

B.            The balance shown to be due a Participating
Company shall be remitted within fifteen (15) days after the issuance of the
reports by CPIC on a collected basis; provided that CPIC may retain, as
manager, a reserve out of amounts otherwise due TICNY for the payment of
amounts reasonably estimated by CPIC to be payable during the next sixty (60)
days by the Traditional Program Business Pool and allocable to TICNY hereunder.  Such balance shall be remitted in cash or in
readily marketable securities (valued at fair market value) in an amount equal
to such balance.  Should discrepancies
arise in the process of the verification of any report, such differences, once
resolved, should be remitted promptly.

C.            As soon as practicable consistent with its
financial reporting practices, but no later than thirty (30) days after the end
of each calendar quarter, CPIC shall report to TICNY ceded unearned premium
reserves and ceded outstanding loss and loss adjustment expense reserves as
regards the Traditional Program Business as of the end of such quarter.

ARTICLEX          Offset

Each of the Participating
Companies shall have and may exercise at any time, and from time to time, the
right to offset any balance or balances whether on account of premiums, losses
or amounts otherwise due from one Participating Company to the other under the
terms of this Pooling Agreement, subject to the provision of applicable law,
and as specifically permitted by Sections 1308 and 7427 of the New York
Insurance Law.

ARTICLE XI         Errors and Omissions

Inadvertent delays, errors
or omissions made in connection with this Pooling Agreement or any transaction
hereunder shall not relieve any Participating Company from any liability that
would have attached had such delay, error or omission not occurred, provided
always that such error or omission will be rectified as soon as possible after
discovery.

ARTICLE XII       Access to Records

The files and records of
each Participating Company with respect to this Pooling Agreement and the Traditional
Program Business subject hereto shall be open to examination by any officer or

 7
 

director of each of the
other Participating Companies or their duly authorized representatives during
normal business hours.

ARTICLE XIII      Term

A.            This Pooling Agreement will become effective
on the Effective Date.  A Participating
Company may terminate its respective participation in the Traditional Program
Business Pool as of the date forty-eight (48) months after the Effective Date
and thereafter as of the close of a calendar quarter by giving at least six (6)
months prior written notice to the other party by certified or registered mail.

B.            CPIC shall have the right to terminate its
participation in the Traditional Program Business Pool at any time on or after
twenty four (24) months after the Effective Date and thereafter by giving sixty
(60) days prior written notice by certified or registered mail to TICNY if the
sum of the cumulative Net Loss Ratio for the Traditional Program Business Pool
plus the Management Fee Percentage (as defined in the Pool Management Agreement
equals or exceeds 99 % for the period from the Effective Date to the end of the
calendar quarter immediately preceding the date of such notice. If the
Participating Companies cannot agree as to the calculation of the Net Loss
Ratio or Management Fee Percentage, within 30 days of receiving the appropriate
report, the calculation shall be arbitrated. The actuarial firm of Towers
Perrin shall furnish an arbiter for TICNY, and CPIC will choose another
actuarial firm to furnish its arbiter. Those two arbiters will select a third
independent actuarial firm to furnish the third arbiter.

C.            Notwithstanding paragraphs A and B above, this
Pooling Agreement may be terminated immediately with respect to new or renewal
business (a) at any time by mutual consent in writing by each of the
Participating Companies or (b) as of the close of a calendar quarter, upon
not less than sixty (60) days, prior written notice by a Participating Company
to the other Participating Company of such Participating Company’s exercise of
its right to terminate its participation in the Traditional Program Business
Pool.

D.            If this Pooling Agreement is terminated
pursuant to this Article XIII, all rights and obligations of the Participating
Companies with respect to Traditional Program Business ceded pursuant

 8
 

to this Pooling Agreement
prior to such termination shall continue to be governed by the terms of this
Pooling Agreement.

ARTICLE XIV      Reinsurance Credit

A.            If any Participating Company is unauthorized
or otherwise unqualified in any state or other United States jurisdiction, and
if, without such security, a financial penalty to an other Participating
Company, hereinafter in this Article XIV called the “Reinsured Participating
Company”, would result on any statutory statement or report it is required to
make or file with insurance regulatory authorities or a court of law in the
event of insolvency, the Participating Company will timely secure its share of
Obligations under this Agreement in a manner, form, and amount acceptable to the
Reinsured Participating Company and to all applicable insurance regulatory
authorities in accordance with this Article.

B.              The Participating Company shall secure such
Obligations by either:

1.             Clean,
irrevocable, and unconditional evergreen letter(s) of credit (“Letter(s) of
Credit”) meeting the requirements of New York Insurance Regulation 133; and/or

2.             A
trust account meeting the requirements of New York Regulation 114.

C.            The “Obligations” referred to herein means
the then current (as of the end of each calendar quarter) sum of:

1.             The
amount of the ceded unearned premium reserve for which the Participating
Company is responsible to the Reinsured Participating Company;

2.             The
amount of Losses and Loss Adjustment Expenses and other amounts paid by the Reinsured
Participating Company for which the Participating Company is responsible to the
Reinsured Participating Company but has not yet paid;

3.             The
amount of ceded reserves for Losses and Loss Adjustment Expenses (including,
ceded reserves for losses incurred but not reported) for which the
Participating Company is responsible to the Reinsured Participating Company;
and

 9
 

4.             The
amount of return and refund premiums paid by the Reinsured Participating
Company for which the Participating Company is responsible to the Reinsured
Participating Company but has not yet paid.

D.            To the extent that the Participating Company
elects to provide Letter(s) of Credit, the following shall apply:

1.             Each
Letter of Credit 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 Reinsured Participating Company not less than 30
days prior to said expiration date.

2.             The
Letter of Credit must be issued or confirmed by a bank which is authorized to issue
letters of credit, which is either a member of the Federal Reserve System or is
a New York State chartered bank, and which in all other respects satisfies the
definition of a “Qualified Bank” under Section 79.1(e) of New York Insurance
Regulation 133.  If the Letter of Credit
is issued by a bank authorized to issue letters of credit but which is not such
a “Qualified Bank”, then the Letter of Credit must be confirmed by such a bank
and the Letter of Credit must meet all of the conditions set forth in Section
79.4 of New York Insurance Regulation 133.

3.             The
Participating Company and the Reinsured Participating Company agree that the
Reinsured Participating Company may draw upon the Letter(s) of Credit at any
time, notwithstanding any other provisions in the Agreement, provided such
assets are applied and utilized by the Reinsured Participating Company or any
successor of the Reinsured Participating Company by operation of law,
including, without limitation, any liquidator, rehabilitator, receiver or conservator
of the Reinsured Participating Company, without diminution because of the
insolvency of the Reinsured Participating Company or the Participating Company,
only for the following purposes:

 10
 

(i)    to
reimburse the Reinsured Participating Company for the Participating Company’s
share of premiums returned to the owners of policies reinsured under this
Agreement on account of cancellations of such policies;

(ii)   to
reimburse the Reinsured Participating Company for the Participating Company’s
share of surrenders and benefits or losses paid by the Reinsured Participating
Company under the terms and provisions of the policies reinsured under this
Agreement;

(iii)  to
fund an account with the Reinsured Participating Company in an amount at least
equal to the deduction, for reinsurance ceded, from the Reinsured Participating
Company’s liabilities for policies ceded under this Agreement.  Such amount shall include, but not be limited
to, amounts for policy reserves for claims and losses incurred (including
losses incurred but not reported), loss adjustment expenses, and unearned
premiums; and

(iv)  to
pay any other amounts the Reinsured Participating Company claims are due under
this Agreement.

4.             the
Reinsured Participating Company shall immediately return to the Participating
Company any amounts drawn down on the Letter of Credit that are subsequently
determined not to be due.

5.             The
issuing bank shall have no responsibility whatsoever in connection with the
propriety of withdrawals made by the Reinsured Participating Company of the
disposition of funds withdrawn, except to ensure that withdrawals are made only
upon the order of properly authorized representatives of the Reinsured
Participating Company.

E.              To the extent that the Participating Company
elects to establish a trust account, the following shall apply.

1.             It
is agreed that the Participating Company shall enter into a trust agreement
(the “Trust Agreement”) in a form acceptable to the Reinsured Participating
Company and establish a trust account (the “Trust Account”) for the sole
benefit of the Reinsured Participating Company with a trustee

 11
 

(the “Trustee”),
which shall be at the time the Trust is established, and shall continue to be,
either a member of the Federal Reserve System or a New York state chartered
bank and which shall not be a parent, subsidiary or affiliate of the
Participating Company or the Reinsured Participating Company.

2.             The
Participating Company agrees to deposit and maintain in said Trust Account
assets to be held in trust by the Trustee for the benefit of the Reinsured
Participating Company as security for the payment of the Participating Company’s
Obligations to the Reinsured Participating Company under the Agreement.  Such assets shall be maintained in the Trust
Account by the Participating Company as long as the Participating Company
continues to remain liable for such Obligations.

3.             The
Participating Company agrees that the assets deposited into the Trust Account
shall be valued according to their current fair market value and shall consist
only of currency of the United States of America, certificates of deposit
issued by a United States bank and payable in United States legal tender, and
investments of the types specified in paragraphs (1), (2), (3), (8) and (10) of
Section 1404(a) of the New York Insurance Law, provided such investments are
issued by an institution that is not the parent, subsidiary or affiliate of
either the Grantor or the Beneficiary (“Authorized Investments”).

4.             The
Participating Company, prior to depositing assets with the Trustee, shall
execute all assignments and endorsements in blank, and shall transfer legal
title to the Trustee of all shares, obligations or any other assets requiring
assignments, in order that the Reinsured Participating Company, or the Trustee
upon direction of the Reinsured Participating Company, may whenever necessary
negotiate any such assets without consent or signature from the Participating
Company or any other entity.

5.             All
settlements of account under the Trust Agreement between the Reinsured
Participating Company and Participating Company shall be made in cash or its
equivalent.

6.             The
Participating Company and the Reinsured Participating Company agree that the
assets in the Trust Account may be withdrawn by the Reinsured Participating
Company at any time, notwithstanding any other provisions in the Agreement,
provided such assets are applied and utilized by

 12
 

the Reinsured
Participating Company or any successor of the Reinsured Participating Company
by operation of law, including, without limitation, any liquidator,
rehabilitator, receiver or conservator of the Reinsured Participating Company,
without diminution because of the insolvency of the Reinsured Participating
Company or the Participating Company, only for the following purposes:

(i)    to
reimburse the Reinsured Participating Company for the Participating Company’s
share of any Losses and Loss Adjustment Expenses paid by the Reinsured
Participating Company but not received from the Participating Company or for
unearned premiums due to the Reinsured Participating Company but not otherwise
paid by the Participating Company under the Agreement; or

(ii)   to
make payment to the Participating Company of any amounts held in the Trust
Account that exceed 102% of the Participating Company’s Obligations (less the
balance of credit available under any Letter(s) of Credit) hereunder; or

(iii)  where
the Reinsured Participating Company has received notification of termination of
the Trust Account, and where the Participating Company’s entire Obligations
under the Agreement remain unliquidated and undischarged ten (10) days prior to
such termination, to withdraw amounts equal to such Obligations (less the
balance of credit available under any Letter(s) of Credit) and deposit such
amounts in a separate account, in the name of the Reinsured Participating
Company, in any United States bank or trust company, apart from its general
assets, in trust for such uses and purposes specified in sub-paragraphs (i) and
(ii) above as may remain executory after such withdrawal and for any period
after such termination.

7.             The
Participating Company shall have the right to seek the Reinsured Participating
Company’s approval to withdraw all or any part of the assets from the Trust
Account and transfer such assets to the Participating Company, provided that
the withdrawal conforms to the following requirements:

 13
 

(i)    the
Participating Company shall, at the time of withdrawal, replace the withdrawn
assets with other Authorized Investments having a market value equal to the
market value of the assets withdrawn,

(ii)   after
such withdrawal and transfer, the market value of the Trust Account is no less
than 102% of the Participating Company’s Obligations (less the balance of
credit available under any Letter(s) of Credit).

In the event that the
Participating Company seeks the Reinsured Participating Company’s approval
hereunder, the Reinsured Participating Company shall not unreasonably or
arbitrarily withhold its approval.

8.             In
the event that the Reinsured Participating Company withdraws assets from the
Trust Account for the purposes set forth in Paragraph (6)(i) above in excess of
actual amounts required to meet the Participating Company’s Obligations to the
Reinsured Participating Company (less the balance of credit available under any
Letter(s) of Credit), or in excess of amounts determined to be due and under
Paragraph (6)(iii) above, the Reinsured Participating Company will return such
excess to the Participating Company.

9.             The
Reinsured Participating Company will prepare and forward at annual intervals or
more frequently as determined by the Reinsured Participating Company, but not
more frequently than quarterly to the Participating Company a statement for the
purposes of this Article, showing the Participating Company’s share of
Obligations as set forth above.  If the
Participating Company’s share thereof exceeds the then existing balance of the
security provided, the Participating Company will, within fifteen (15) days of
receipt of the Reinsured Participating Company’s statement, but never later
than December 31 of any year, increase the amount of the letter of credit, or
Trust Account to the required amount of the Participating Company’s share of
Obligations set forth in the Reinsured Participating Company’s statement, but
never later than December 31 of any year. 
If the then existing balance of the security provided exceeds an amount
equal to 102% of the Participating Company’s share thereof, the

 14
 

Reinsured
Participating Company will release the amount in excess of 102% to the
Participating Company upon the Participating Company’s written request.

F.             The Participating Company will take any other
reasonable steps that may be required for the Reinsured Participating Company
to take full credit on its statutory financial statements for the reinsurance
provided by this Agreement.

ARTICLE XV       Amendments 

This Pooling Agreement may be amended only if
in writing and signed by each Participating Company.

ARTICLE XVI      Adjustments to Participation

CPIC may, in its sole discretion, change the Pooling Percentages as set
forth in Schedule 1 hereto as of the date that is six (6) months following the
Effective Date and, from time to time, as of any six (6) month anniversary of
the Effective Date thereafter, upon not less than thirty (30) days prior
written notice to the other Participating Company, unless such notice is waived
by the other Participating Company, and provided, however, that the CPIC and
the other Participating Company may agree to change the pool participations as
of any calendar quarter; provided, however, that the Pooling Percentage of
TICNY shall at all times during the term of this Pooling Agreement be a minimum
of 15% and a maximum of 50%, and provided further, however, that the total
combined gross written premium share of TICNY assumed under this Pooling
Agreement shall not exceed $50 million for the twelve (12) month period ending
on March 31, 2007, subject to a growth factor of 25% per each twelve (12) month
period thereafter, unless otherwise agreed by the parties.  Each such change shall apply to Policies
issued or renewed after the effective date of such change.  Schedule 1 shall be revised to reflect all
such changes and the effective date of each such change. If the maximum gross
written premium after pooling is attained in any twelve (12) month period
ending March 31 as set forth herein, unless as otherwise agreed by the parties
as et forth above, then the Pooling Percentage, which shall apply to all
premiums and losses on a pro-rated

 15
 

basis for such period, of TICNY shall be
decreased for that twelve (12) month period, even if such Pooling Percentage is
below 15%.

ARTICLE XVII                    Investments

The investments of the Participating
Companies and any income, gains or losses derived therefrom and expenses
related thereto, are not part of, nor are they subject to the terms of, this
Pooling Agreement.

ARTICLE XVIII                   Insolvency

A.            In the event of the insolvency or the
appointment of a liquidator, receiver or other statutory successor of a
Participating Company, any amount due such Participating Company as a ceding
party shall be payable by the accepting party on the basis of the liability of
the ceding party under the Policies reinsured without diminution because of the
insolvency of the ceding party.  Payments
by the accepting party shall be made directly to the ceding party or to the
liquidator, receiver or statutory successor, except (a) where any Policy
specifically provides another payee of such reinsurance in the event of the
insolvency of the ceding party, or (b) where the accepting party, with the
consent of the direct insured or insureds, has assumed such Policy obligations
of the ceding party as direct obligations of the accepting party to payees
under such Policies and in substitution for the obligations of the ceding party
to such payees.

B.            The liquidator or receiver or statutory
successor of the ceding party shall give written notice to the accepting party
of the pendency of any claim against the insolvent ceding party on the Policies
reinsured within a reasonable time after such claim is filed in the insolvency
proceeding.  During the pendency of such
claim, the accepting party may investigate the claim and interpose in the
proceeding where the claim is to be adjudicated, at its own expense, any
defense or defenses which it may deem available to the ceding party or its
liquidator or receiver or statutory successor. 
The expenses thus incurred by the accepting party shall be chargeable,
subject to court approval, against the insolvent ceding party solely as a
result of the defense undertaken by the accepting party.

 16
 

ARTICLE XIX      Arbitration

A.            As a condition precedent to any right of
action hereunder, in the event of any dispute or difference of opinion
hereafter arising with respect to this Pooling Agreement (except as set forth
in Article XIII – Term), it is hereby mutually agreed that such dispute or
difference of opinion shall be submitted to arbitration.  One Arbiter shall be chosen by each
Participating Company that is a party to such dispute and an Umpire shall be
chosen by the Arbiters before they enter upon arbitration, all of whom shall be
active or retired disinterested executive officers of insurance or reinsurance
companies or Underwriters at Lloyd’s of London. 
In the event that a Participating Company should fail to choose an
Arbiter within thirty (30) days following a written request by another
Participating Company to do so, the requesting Participating Company’s Arbiter
shall choose a second arbiter before entering upon arbitration.  If the two arbitrators are unable to agree
upon the third arbitrator within thirty (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 United States District Court having jurisdiction
over the geographical area in which the arbitration is to take place, or if
that court declines to act, the state court having general jurisdiction in such
area.

B.            Participating Companies party to the dispute
shall present their case to the Arbiters within thirty (30) days following the
date of appointment of the Umpire.  The
Arbiters shall consider this Pooling Agreement as an honorable engagement
rather than merely as a legal obligation and they are relieved of all judicial
formalities and may abstain from following the strict rules of law.  The decision of the Arbiters shall be final
and binding on all Participating Companies; but failing to agree, they shall
call in the Umpire and the decision of the majority shall be final and binding
upon all parties.  Judgment upon the
final decision of the Arbiters may be entered in any court of competent
jurisdiction.

C.            Each Participating Company that is a party to
the dispute shall bear the expense of its own Arbiter, and shall jointly and
equally bear with the other the expense of the Umpire and of the
arbitration.  In the event that the two
Arbiters are chosen by the requesting Participating Company, as above provided,

 17
 

the
expense of the Arbiters, the Umpire and the arbitration shall be equally
divided between the Participating Companies that are parties to the
arbitration.

ARTICLE XX       Miscellaneous Provisions

A.            Headings used herein are not a part of this
Pooling Agreement and shall not affect the terms hereof.

B.            All notices, requests, demands and other
communications under this Pooling Agreement must be in writing and will be
deemed to have been duly given or made as follows:  (a) if sent by registered or certified mail
in the United States return receipt requested, upon receipt; (b) if sent by
reputable overnight air courier, two business days after mailing; (c) if sent
by facsimile transmission, with a copy mailed on the same day in the manner
provided in (a) or (b) above, when transmitted and receipt is confirmed by
telephone; or (d) if otherwise actually personally delivered, when delivered.

C.            This Pooling Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors,
permitted assigns and legal representatives. 
Neither this Pooling Agreement, nor any right or obligation hereunder,
may be assigned by any party without the prior written consent of the other
party hereto.

D.            This Pooling Agreement may be executed by the
parties hereto in any number of counterparts, and by each of the parties hereto
in separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

E.             This Pooling Agreement will be construed,
performed and enforced in accordance with the laws of the State of New York
without giving effect to its principles or rules of conflict of laws thereof to
the extent such principles or rules would require or permit the application of
the laws of another jurisdiction.

F.             This Pooling Agreement constitutes the entire
agreement between the parties hereto relating to the subject matter hereof and
supersedes all prior and contemporaneous agreements, understandings,

 18
 

statements, representations
and warranties, negotiations and discussions, whether oral or written, of the
parties and there are no general or specific warranties, representations or
other agreements by or among the parties in connection with the entering into
of this Pooling Agreement or the subject matter hereof except as specifically
set forth or contemplated herein. If any provision of this Pooling Agreement is
held to be void or unenforceable, in whole or in part, (i) such holding
shall not affect the validity and enforceability of the remainder of this Pooling
Agreement, including any other provision, paragraph or subparagraph, and
(ii) the parties agree to attempt in good faith to reform such void or
unenforceable provision to the extent necessary to render such provision
enforceable and to carry out its original intent.

G.            No consent or waiver, express or implied, by
any party to or of any breach or default by any other party in the performance
by such other party of its obligations hereunder shall be deemed or construed
to be a consent or waiver to or of any other breach or default in the
performance of obligations hereunder by such other party hereunder.  Failure on the part of any party to complain
of any act or failure to act of any other party or to declare any other party
in default, irrespective of how long such failure continues, shall not
constitute a waiver by such first party of any of its rights hereunder.  The rights and remedies provided are
cumulative and are not exclusive of any rights or remedies that any party may
otherwise have at law or equity.

H.            Except as expressly provided for in the
insolvency provisions above, nothing in this Pooling Agreement will confer any
rights upon any person that is not a party or a successor or permitted assignee
of a party to this Pooling Agreement.

I.              Wherever the words “include,” “includes” or “including”
are used in this Pooling Agreement, they shall be deemed to be followed by the
words “without limitation.”

J.             This Article XX shall survive the termination
of this Pooling Agreement.

 19
 

IN WITNESS WHEREOF, the Participating Companies have caused this Pooling Agreement to be
executed by their duly authorized representatives, subject to the satisfaction
of New York Insurance Law § 1505, including any conditions such regulators may
impose on the terms of this Agreement subsequent to the date hereof.

	
   

  	
   

  
	
  

  	
   

  
	
   

  	
  TOWER INSURANCE COMPANY OF NEW YORK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Francis M.
  Colalucci

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Francis M.
  Colalucci

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President & Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  Date:

  	
  January 11,
  2007

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CASTLEPOINT
  INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joel S.
  Weiner

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Joel S. Weiner

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President & Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  Date:

  	
  January 11,
  2007

  
						

 

 20

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