Document:

EXHIBIT 10 (c)

                       CLAIMS ADMINISTRATION AGREEMENT
                     (hereinafter called the "Agreement")

                                   between

                         MILLERS GENERAL AGENCY, INC.
                   (hereinafter called the "Administrator")

                                     and

                     CLARENDON NATIONAL INSURANCE COMPANY

                      (hereinafter called the Company")

                   made as of the 15th day of August, 2001

                                   RECITALS

           A. The Company entered into a general agency agreement ("Agency
 Agreement") with the Administrator as General Agent ("General Agent") for
 the issuance and administration of insurance policies in certain states
 ("Policies", or individually, "Policy").

           B. The Administrator is experienced in the administration or
 insurance claims and is duly qualified to administer and adjust claims
 arising under the Policies

           C. The Company would like the Administrator to administer and
 adjust such claims, and the Administrator is willing to do so on behalf of
 the Company in accordance with the terms of this Agreement.

           IN CONSIDERATION OF THE MUTUAL PROMISES EXCHANGED). the parties

 agree as follows:

                                  ARTICLE I

                   AUTHORITY AND SERVICES OF ADMINISTRATOR

      1.1  Authority. The Administrator shall administer and adjust all
 claims arising under the Policies (including claims under Policies written
 for the Company's participation in mandatory underwriting facilities,
 including but not limited to, joint underwriting associations or assigned
 risk pools) in accordance with the terms and conditions of the Policies and
 as authorized by the Company pursuant to this Agreement. All claims services
 to be provided by the Administrator under this Agreement shall conform
 to the written standards or guidelines of the Administrator ("Claim
 Standards"). The Administrator shall be solely responsible for assuring
 that the Claim Standards comply with all governmental statutes, rules, or
 regulations of any applicable jurisdiction. Upon signing this Agreement,
 the Administrator shall provide to the Company a copy of its then in effect
 Claims Standards, and Administrator shall provide to the Company any
 updates, modifications, or amendments thereof no less than annually
 throughout the terms of this Agreement. The Administrator shall perform
 its obligations in conformity with any reasonable standards, instructions,
 practices or procedures which the Company may. from time to time, provide to
 the Administrator, which standards, instructions, practices and procedures
 shall, when provided to the Administrator, become part of the Claim
 Standards. The Claims Standards shall also include the applicable
 limitations and exclusions set forth in the Company's reinsurance agreements
 ("Reinsurance Agreements"), a current schedule of which is attached hereto,
 covering business produced under the Agency Agreement and the Policies. The
 Company agrees to, where applicable, provide the relevant sections of the
 Reinsurance Agreements to the Administrator, either directly or through a
 reinsurance intermediary or other representative. Once the Administrator
 receives copies of the Reinsurance Agreements, the limitations and
 exclusions set forth in the Reinsurance Agreements will become part of the
 Claims Standards, and the Administrator will be bound by such imitations and
 exclusions. Notwithstanding the foregoing, the Company has and will retain
 the final authority over decisions and policies regarding claims
 administration, including without limitation, the payment or non-payment
 of claims.

      1.2  Services. The Administrator shall perform the following services
 in compliance with applicable law and the Claims Standards, subject to
 periodic review and audit thereof by the Company throughout the term of this
 Agreement:

           (a)  Record, examine and promptly report each claim to the Company
 on a monthly basis, as well as any reserve established therefor by the
 Administrator.

           (b)  Maintain a claim file for each reported claim containing,
 among other things a copy of the declarations page of the relevant Policy
 (which shall clearly identify the Policy and the insured) and an activity
 log.

           (c)  Perform reasonable and necessary administrative and clerical
 work in connection with reported claims, including without limitation, the
 following:

                (i) Investigate all reported claims to the extent the
 Administrator deems necessary.

                (ii) Determine and evaluate any coverage issues in connection
 with the claims and refer same to the Company or counsel with
 recommendations.

                (iii) Determine proper workers' compensation benefits due,
 if any, on compensable claims.

                (iv) Establish appropriate reserves for all claims, subject
 however, to the right of the Company to adjust the amounts of such reserves
 based upon the Claims Standards.

                (v)  Deny coverage with respect to those claims which the
 Administrator determines should be denied based upon factors established by
 the Claims Standards, in writing, as a basis for denying coverage.

                (vi) Adjust, settle and bring to a conclusion those claims
 which the Administrator determines the Company is legally obligated to pay
 in accordance with applicable law, the terms of the Policies, and the Claims
 Standards.

                (vii) Adjust claims only through adjusters who are currently
 licensed as public adjusters, independent adjusters, or company employee
 adjusters and appointed by the Administrator provided, however, that the
 Administrator shall not subcontract any of its obligations hereunder (other
 than hiring local adjusters to investigate specific claims) without first
 obtaining the Company's written consent and approval of the terms of the
 proposed subcontract. The Administrator shall promptly furnish the Company
 with such information as the Company may request in order to evaluate the
 prospective subcontractor. Any subcontractor must be currently licensed as
 a public or independent adjuster.

                (viii) Prepare necessary information for any salvage,
 subrogation or contribution action which in the Administrator's judgment may
 inure to the benefit of the Company.

                (ix) Appoint independent counsel from a list approved by the
 Company and, at the Company's direction, coordinate a proper defense with
 such counsel.

                (x) Prepare checks, vouchers, compromise agreements,
 releases and other documents necessary or desirable to close out claims.

                (xi) Continuously review outstanding claim reserves and
 recommend to the Company any changes to such reserves deemed necessary by
 the Administrator; and provide the Company with written monthly reports
 showing all outstanding claims then being administered by the Administrator,
 the activity being performed with regard to the claims, and any changes to
 outstanding reserves as of the date of the report, all as more specifically
 provided in Section 1.3 of this Agreement.

                (xii) Record and report promptly to the Company each loss
 and Legal Loss Adjustment Expense (as defined herein) paid, utilizing
 mutually agreed upon claim disbursement, checking and coding procedures.

           (d)  Periodically review the claims handling procedure with the
 Company to identify any problems and to arrive at mutually agreeable
 corrective action.

           (e)  Where applicable and required, prepare and forward the
 Company's federal and state 1099 filings and prepare and distribute 1099
 Forms to all applicable payees.

           (f) Report suspected fraud as required by any applicable statute
 or regulation in the state(s) where the Policies are issued.

           (g)  Pursue the Company's salvage, subrogation and contribution
 rights relating to any losses sustained under the Policies, and promptly
 report to the Company and account for any salvage, subrogation and
 contribution collections. If a  Policy contains deductible or similar
 provisions (such as a self-insured retention provision) requiring the holder
 of the Policy (''Policyholder") to reimburse the Company for the payment
 of loss and/or loss adjustment expenses (collectively, "deductible
 reimbursement" the Administrator shall be responsible for billing and
 collecting the deductible reimbursement from the Policyholder or
 drawing upon any security deposited by the Policyholder to satisfy the
 Policyholder's obligation to pay the deductible reimbursement. Within ten
 (I0) days after a payment giving rise to a deductible reimbursement is made,
 the Administrator shall send an invoice to the Policyholder for the amount
 of the deductible reimbursement. If the deductible reimbursement is
 not collected within thirty (30) days after the invoice is sent, the
 Administrator shall send a second invoice to the Policyholder and, if such
 second invoice is not paid, shall, in its capacity as General Agent and in
 accordance with Section 1.5 (j) of the Agency Agreement, and to the extent
 lawful, cancel the Policy for non-payment of the deductible reimbursement.

           (h)  Promptly notify and consult with the Company with respect to
 the following:

                (i)  Any loss or claim resulting in a lawsuit being
 instituted against the Administrator or the Company.

                (ii) Any serious complaint (in the judgment of the
 Administrator) being filed with, or any inquiry regarding such complaint
 from, any insurance department or other regulatory authority relating to any
 loss or claim which might result in regulatory action being taken against
 the Company or the Administrator. In such case (1) the Administrator shall
 immediately forward to the Company a copy of any written communication
 received from the regulatory authority, and (2) if a response affecting the
 Company or the Administrator is required, the Administrator shall, within
 five (5) business days after the receipt of the complaint or receipt of thc
 inquiry, draft a response and submit it to the Company for approval before
 submitting it to the regulatory authority. The Administrator may respond
 directly to other complaints or inquiries arising in the normal course of
 business.

                (iii) Any loss or claim in respect of which the
 Administrator makes a recommendation or determination to deny coverage for
 reasons not established by the Claims Standards, as well as any coverage
 dispute.

                (iv) Any claim which the Administrator anticipates will
 result in a loss payment (1) in excess of $10,000, or (2) in an amount
 established by an insurance department having jurisdiction.

                (v) Any claim (1) which is open for more than six (6)
 months, or (2) which involves extra-contractual allegations, or (3) which
 involves a minor, or (4) which involves permanent disability or disability
 for a period of nine (9) months or more, or (5) which involves loss of life
 or limb, amputation, spinal cord or brain injury, loss of eyesight or
 hearing, poisoning, extensive burns, or multiple fractures.

                (vi) Any suspected or alleged fraud, or any allegation of
 "bad faith" in claims handling against the Administrator or the Company.

                (vii) In any of the foregoing cases, the Administrator shall
 forward a copy of the complete claim file to the Company at the Company's
 request.

           (i)  Maintain in good standing all licenses, permits and
 authorizations necessary or appropriate for the Administrator (and any
 adjuster, investigator or appraiser employed by the Administrator) to
 perform services under this Agreement in compliance with all applicable
 laws, rules and regulations; and the Administrator shall use only public
 independent adjusters, investigators or appraisers who are duly licensed
 in the states where their services are performed.

           (j)  Neither the Administrator nor anyone appointed by it shall
 have any right or authority (I) to alter, modify, or terminate any Policy,
 except in its capacity as General Agent and in accordance with the
 provisions of the General Agency Agreement or of subparagraph (g) of this
 Section 1.2, (2) to waive any Policy provision, or (3) to commit the Company
 to any claim settlement with any of the Company's reinsurers, without the
 prior written consent of the Company.

           (k)  The Administrator is responsible for ensuring that Policies
 are administered according to customary and usual customer service and
 policy administration standards. The Administrator shall promptly respond to
 inquiries, correspondence and communications, whether written, telephonic or
 electronic. The Administrator shall ensure that it has sufficient staffing
 or independent contractors to perform all its functions and obligations
 hereunder, and to assist in servicing the business and Policies, as required
 by this Agreement.

      1.3  Claims Reports and Files.

           (a)  The Administrator, at its sole cost, shall provide claims
 reports ("Claims Reports") to
 the Company, whether on hard copy, disks or tapes or electronically, within
 seven (7) days after the end of each calendar month unless otherwise set
 forth herein. The Claims Reports shall include the following:

                (i)  Information and statistical data (1) required by the
 Insurance Services Office ("ISO"), (2) necessary for the Company to prepare
 any reports required by the National Association of Insurance Commissioners
 or the National Council of Compensation insurers (including unit statistical
 reports and data calls relating to any workers' compensation Policies), and
 (3) necessary for any other purpose the Company may reasonably request same,
 including without limitation: (A) to monitor and evaluate the business
 written under the Agency Agreement; (B) to comply with any reporting
 requirements under any applicable reinsurance agreements; and (C) to comply
 with any current or future state or rating agency reporting requirements.
 All information required by the Company to evaluate the business, to comply
 with reinsurance reporting requirements or to comply with state or rating
 agency reporting requirements shall be deemed to have been reasonably
 requested. The Administrator shall furnish all such reports to the Company
 at least fifteen (15) days prior to applicable filing deadlines,
 notwithstanding any contrary time provisions in this Agreement.

                (ii) Loss runs showing paid claims on a monthly, year-to-
 date, and inception-to-date basis, the date when each claim was first
 reported to the Administrator and outstanding reserves remaining at the end
 of each month, by state, and categorized as indemnity, medical payment, or
 loss adjustment expense, and any other information required for the
 Company's annual financial statement or by state regulatory agencies.
 Loss adjustment expenses shall be further categorized as allocated loss
 adjustment expenses ("ALAE") or unallocated loss adjustment expenses
 ("ULAE") based on the revised NAIC definitions of ALAE and ULAE to be used
 for reporting purposes effective January 1, 1998. ALAE are comprised of
 defense, litigation and medical cost containment expenses, whether internal
 or external. ALAF include (but are not limited to) the following expenses:
 (i) surveillance; (ii) fixed amounts for medical cost containment; (iii)
 litigation management; (iv) loss adjustment expenses for participation in
 voluntary and involuntary market pools if reported by accident year;
 (v) fees or salaries for appraisers private investigators, hearing
 representatives, reinspectors and fraud investigators, if working in defense
 of a claim, and fee or salaries for rehabilitation nurses, if such cost is
 not included in losses; (vi) attorney fees incurred by reason of a duty to
 defend, even when other coverage does not exist; and (vii) the cost of
 engaging experts. ULAE are comprised of those loss adjustment expenses
 other than ALAE as defined above. ULAE include (but are not limited to) the
 following expenses: (i) fees of adjusters and settling agents; (ii) loss
 adjustment expenses for participation in voluntary and involuntary market
 pools if reported by calendar year: (iii) attorney fees incurred in the
 determination of coverage, including litigation between the insurer and the
 policyholder; and (iv) fees or salaries for appraisers, private
 investigators, hearing representatives, reinspectors and fraud
 investigators, if working in the capacity of an adjuster.

                (iii) The number (count) of open claims, new claims, claims
 closed with payment and claims closed without payment, each count being
 shown:

                     monthly and year-to-date
                            and
                     by line of business and by state.

                (iv) Claims Register (as later defined}

                (v)  Check Register (as later defined), including outstanding
 check register.

                (vi) Reserve transaction journal setting forth all reserve
 changes per claim per line for the applicable reporting period.

                (vii) Large loss listing (as determined by the Company),
 including cumulative paid and outstanding reserves monthly.

                (viii) Aggregate loss runs (on a paid and incurred basis) by
 Policy.

           (b)  The Administrator shall deliver to the Company copies of the
 Administrator's computer data base ("Computer Data") maintained in support
 of its Claims Reports. The Computer Data shall be delivered to the Company
 in a format (i) acceptable to the Company and any entity which requires the
 data from the Company, (ii) readable on the Company's and such entity's
 computer system, and (iii) which complies with the file layout
 specifications set forth or the attached Schedule 1 or any subsequent file
 layout specifications provided to the Administrator by the Company. The
 Computer Data shall consist of all information contained in the Claims
 Reports including, with respect to each claim, the claim number, the Policy
 number, the name of the insured, the effective date and expiration date of
 the Policy, the type of loss by coverage, the date when the claim was first
 reported to the Administrator, the accident date, the reserve, any paid
 loss, any paid loss adjustment expenses, and any salvage, subrogation or
 contribution recovery. The Administrator shall also prepare completed
 reports for the ISO including the data and detail required by the ISO,
 and in the format required by the ISO, and shall (i) submit such reports
 directly to the ISO with a copy to the Company, or (ii) submit such reports
 to the Company for transmission to the ISO. In addition, the Administrator
 shall use its reasonable best efforts, if not prohibited by law, to provide
 the Company, at the Administrator's expense, with a limited license to use
 the software system used by the Administrator in its administration arid
 run-of of claims under this Agreement, including all computer programs and
 updated source and object codes ("Software"). The Administrator shall
 deliver the Software, as well as all necessary manuals, to the Company at
 the same time as it delivers the Computer Data to the Company.

           (c)  The Administrator shall own the book of business which is the
 subject of this Agreement. including without limitation, the Policy renewals
 and expirations, the policyholder list, the Iist of Agents, all financial
 information relating to the Policies (including rating, underwriting and
 loss information), and any and all goodwill and trade secrets relating
 thereto (the "Book of Business''). The Company acknowledges the
 Administrator's ownership of the Book of Business and agrees to preserve
 and protect such assets on behalf of the Administrator. The Company shall
 further preserve and protect all Data and confidential information
 pertaining to the Book of Business (the "Confidential Information").
 Clarendon will hold and will cause its respective employees and employees
 of its affiliate companies, to hold in strict confidence the Confidential
 Information (except to the extent that such information can be shown to have
 been (i) previously known to Clarendon (or its respective affiliates) prior
 to its disclosure, (ii) in the public domain through no fault of Clarendon
 or (iii) later lawfully acquired by Clarendon (or its respective affiliates)
 from other sources), and will not release or disclose such information to
 any other person, except in connection with this Agreement to its respective
 auditors, actuaries, attorneys, financial advisors and other consultants or
 advisors. Clarendon and its respective representatives may provide such
 Confidential Information in response to judicial or administrative processes
 or applicable governmental laws, rules, regulations. orders or ordinances,
 but only that portion of the Confidential Information which, on the advice
 of counsel, is legally required to be furnished, and provided that Clarendon
 notifies the Administrator of its obligation to provide such information and
 fully cooperates with the Administrator to protect the confidentiality of
 such Confidential Information under applicable law. The Company further
 agrees that, in no event, shall it, directly or indirectly, deliver, discuss
 or make available any Confidential Information to anyone who is known by the
 Company to be involved directly or indirectly with the operations,
 performance, strategies or management of any other person or entity that is
 a competitor of the Administrator.

           (d)  The Company acknowledges and agrees that its use of the
 Computer Data and Software shall be limited to the administration and run-
 off of claims under this Agreement, and the furnishing of the Computer Data
 and Software to the Company by the Administrator shall not be construed as
 conferring upon the Company any right to sell, lease, transferor dispose of
 all or any portion of the Computer Data or Software (except that same may be
 used by the Company's designee, if any, for the purpose of administering and
 running-off the claims). The Company further agrees that (i) it will not
 copy any part of the Computer Data or Software, except as may be required to
 administer and run-off the claims, and (ii) promptly upon completion of the
 administration and run-off of the claims, it will return the Computer Data
 and Software to the Administrator. The Company's designee shall execute an
 agreement setting forth the requirements stated in this section 1.3(d).

           (e)  Subject to the provisions of Section 5.4 (a), closed files
 shall be retained and preserved by the Administrator for a period of six (6)
 years from the date of the last file activity or until her expiration of the
 applicable statute of imitations period, whichever is later ("Retention
 Period"). At the end of the Retention Period the Administrator shall make
 written request of the Company for instructions as to the disposition of
 each closed file. As authorized by the Company, in writing, the
 Administrator shall (i) destroy the closed file or (ii) return the closed
 file to the Company, at the Company's expense. Notwithstanding the forgoing,
 the Administrator shall retain a tile, and the Retention Period shall be
 deemed extended. until there is a final, binding determination of the claim
 by settlement, judgment, or otherwise; and the Administrator shall identify
 and segregate from all other files any file involving a minor and shall
 return such file to the Company at the end of the Retention Period

           (f)  All claims files and records regarding the administration of
 claims under this Agreement. including the financial records relating to the
 Claims Account (as later defined) and the payment of claims and Legal Loss
 Adjustment Expenses (as later defined), may be audited, examined and copied
 by the Company's representatives or by any state insurance department or
 other regulatory authority having jurisdiction, at any times during normal
 business hours. the Company reserves the right at any time, in its sole
 discretion, to assume control over a particular claim and to require the
 Administrator to forward a copy of the claim file to the Company.

           (g)  The Administrator shall maintain the confidentiality of all
 data supplied to or developed by it relating to the claims administered
 under this Agreement, and shall not disclose such data without the prior
 written consent of the Company, or as otherwise authorized by the provisions
 of this Agreement. The Administrator shall not use the name, service mark,
 logo, or authorized signatures of the Company, or any of its affiliates, in
 any advertising or promotional material without the prior written consent of
 the Company.

           (h)  Claims files are and shall remain the property of the
 Company.

      1.4  Claims Account.

           (a)  For purposes of paying claims and claims related expenses,
 the Company shall establish, fund and maintain a separate bank account
 ("Claims Account') which the Administrator may draw against as provided in
 this Agreement.

           (b)  The Company shall fund the Claims Account with amounts
 necessary to pay all claims and "Legal Loss Adjustment Expenses", which
 term, as used in this Agreement, means legal costs and expenses incurred by
 the Administrator and allocated by it to the investigation, adjustment and
 settlement or defense of claims for benefits under the Policies, including
 without imitation, attorneys' fees and disbursements, pre and post judgment
 interest, court reporter services and transcripts, deposition charges and
 transcripts, fees for service of process, court costs, appeal bonds,
 printing costs related to trials and appeals, fees of witnesses amid
 experts, medical examination and review, laboratory costs, vehicle and
 property damage appraisals, surveillance, photography, and similar costs
 reasonably incurred and related to the investigation and defense of claims
 or the protection and prosecution of subrogation rights of the Company.
 Legal Loss Adjustment Expenses shall also include additional compensation
 paid to the Administrator to the extent recoverable under the Reinsurance
 Agreements, a schedule of which will be provided to Clarendon upon request.
 Legal Loss Adjustment Expenses shall exclude all Administrators' Expenses
 (as later defined). The Administrator shall, on a regular basis, provide the
 Company with information and estimates to enable the Company to maintain the
 Claims Account at an appropriate level. In no event shall the Claims Account
 be funded in an amount greater than three (3) months estimated claims
 payments and Legal Loss Adjustment Expenses.

           (c)  Checks drawn on the Claims Account by the Administrator, or
 its agents or employees, shall be signed and issued only in accordance with
 procedures agreed upon in advance by the Company and the Administrator. In
 any ease, checks drawn on the Claims Account must be signed by two (2)
 authorized officers or employees of the Administrator, whose names and
 positions shall be promptly reported to the Company. To issue any check or
 checks aggregating in excess of $50,000 for any one claim, thc Administrator
 shall first send a fax request to the Company for authority to do so and
 shall not issue such check or checks until it receives specific
 authorization therefor by fax from the Company.

           (d)  The Administrator shall maintain a daily register of chocks
 drawn on the Claims Account for each claims payment and Legal Loss
 Adjustment Expense paid ("Check Register"). The Administrator shall maintain
 a daily register of each paid and outstanding claim ("Claims Register")
 which register shall include, for each claim or claimant the claim number,
 Policy number, loss date, name (of payee, date and check number of the
 disbursement, and the amount and purpose of the payment. A copy of the Check
 Register anti Claims Register shall be forwarded to the Company monthly.

           (e)  Any monies collected by the Administrator for salvage,
 subrogation, contribution, or deductible reimbursement, shall be deposited
 in the Claims Account immediately upon receipt, and a register or other
 record of such collections and deposits shall be maintained by the
 Administrator. The register or other record shall contain, among other
 things, the date and amount of the deposit, the date of receipt of the
 funds, the claim number and the payer and the purpose of payment and a copy
 shall be sent to the Company monthly. Such register or record, and the
 Claims Register, shall he reconciled with the Claims Account or a monthly
 basis. The costs of collection for salvage, subrogation or contribution
 shall be limited to necessary payment made to independent third panics and
 shall not include any of the Administrator's expenses referred to in Section
 1.5.

      1.5  Adrninistrator's Expenses. The Administrator shall have sole
 responsibility for its own expenses ("Administrator's Expenses"), including
 without limitation, (a) costs of personnel employed by the Administrator
 (including subcontractors and agents) to perform services under this
 Agreement. such costs to include salaries, payroll taxes, overtime,
 employee benefits, fees and temporary help, (b) rent, utilities, telephone,
 furniture, fixtures, equipment, software, postage, advertising, license
 fees, occupational taxes, and (c) miscellaneous administrative expenses,
 compliance work expenses and processing costs, licensing costs and other
 overhead expenses of the Administrator. Notwithstanding any thing to the
 contrary, the Administrator's Expenses shall exclude any loss adjustment
 expenses paid to Clarendon from its reinsurers pursuant to the Reinsurance
 Agreements

      1.6  Special Investigation Units. The Company has established a fraud
 detection program known as a Special Investigation Unit ("SIU") and conducts
 its own SIU investigations in accordance with Company policy and state law
 governing SIUs. The Administrator shall promptly report to the Company's SIU
 suspected fraudulent claims in order to insure compliance with state and
 federal anti-fraud statutes and regulations, to avoid underwriting
 undesirable risks, to facilitate arid maintain working relationships with
 law enforcement agencies, the National Insurance Crime Bureau and the
 appropriate divisions within the applicable insurance department, and to
 enable the Company to maintain a database of information related to
 insurance fraud.

      1.7  lndependent Contractor.

           (a)  The Administrator is an independent contractor of the
 Company, and nothing contained in this Agreement shall be deemed to create
 the relationship of employer and employee, partners, or joint venturers
 between the Company and the Administrator.

           (b)  The Administrator shall not act as an Insurer, nor shall it
 be ultimately responsible for payment or satisfaction of claims against any
 Policyholder nor for Legal Loss Adjustment Expenses.

           (c)  line Administrator shall not give, or be required to give,
 any legal opinion, or provide any legal representation, to any Policyholder
 or to the Company, and any legal opinions or representation shall be
 provided only by duly licensed outside counsel employed for the purpose by
 the Administrator.

           (d)  For purposes of interpreting the provisions of this
 Agreement, the Administrator shall be deemed to be the Company's agent, and
 it shall perform all of its obligations under this Agreement to the full
 extent required of an agent under the law.

      1.8  Subcontracting.  The Administrator may not enter into a
 subcontract or subcontracts with another person, entity or entities
 ("Subcontractors", or individually "Subcontractor") pursuant to which such
 Subcontractor or Subcontractors shall perform any of the services or produce
 any of the reports to be performed or produced pursuant to this Agreement,
 unless the identity of any such Subcontractor and the form and content of
 any subcontract therewith is approved in advance in writing by the Company.
 No such subcontract shall relieve the Administrator of responsibility for
 the fulfillment of any of its obligations hereunder.

                                  ARTICLE 2

                        COMPENSATION OF ADMINISTRATOR

      2.1  Compensation. For all services to be rendered by the Administrator
 during the term of this Agreement, the Company shall pay the Administrator a
 fee equal to eight percent (8%) of earned premium. Payment of fees shall be
 made in monthly installments. Earned premium shall be determined using
 statutory accounting practices, as permitted and prescribed by applicable
 insurance regulatory bodies.

      2.2  Unearned Fees. The Administrator shall have a continuing
 obligation to refund to the Company, within thirty (30) days of demand, any
 fees paid to the Administrator which have not yet been earned ("unearned
 Fees"). Fees paid to the Administrator shall be deemed earned fees with the
 exception of fees paid to the Administrator for third party liability claims
 administered under the Policies which fees will be deemed unearned until
 such fees are deemed earned fees pursuant to section 2.3 herein.

      2.3  Determination of Earned Fees. For third party liability claims
 administered under the Policies sixty-five percent (65%) of the fees for
 such claims will be deemed earned in the month following the month in which
 the premium for these coverages is earned, twenty-five percent (25%) of the
 fees for such claims will be deemed earned one (1) year thereafter, and the
 remaining ten percent (10%) of the fees for such claims will be deemed
 earned two (2) years thereafter. Until earned, these fees shall he deemed
 to be and included as part of Unearned Fees. The Administrator shall have a
 continuing obligation to refund to the Company, within thirty (30) days of
 demand, fees for third party liability claims paid, but not yet earned
 pursuant to this section 2.3, as well as all Unearned Fees pursuant to
 section 2.2.

      2.4  Loss Adjustment Expenses. Unless otherwise specifically provided
 in this Agreement, the Administrator shall be solely responsible for issuing
 payments for all loss adjustment expenses incurred by or payable to
 independent third parties in the administration of claims under this
 Agreement.

                                  ARTICLE 3

                              DUTIES OF COMPANY

      3.1  Cooperation. The Company shall cooperate with the Administrator to
 the extent reasonably necessary to enable the Administrator to adequately
 perform claims services under this Agreement, including without limitation,
 responding promptly to the Administrator's requests for relevant
 information, meeting as needed with the Administrator or persons designated
 by the Administrator. making decisions on claim matters as required by this
 Agreement, and remitting funds to the Claims Account as required.

      3.2  Loss Coverage. The Company shall provide timely and complete loss
 coverage In accordance with the terms of the Policies. When the Company
 makes a determination as to coverage under any Policy, any liability, loss,
 cost or expense relating to such coverage shall be borne solely by the
 Company and the Company agrees to hold the Administrator harmless with
 respect to same. When the Administrator denies coverage and such denial is
 not based on the Claims Standards or the Company's explicit written and
 Iawful instructions, the Administrator shall be liable for any liability,
 loss, cost or expense relating to such coverage and agrees to hold the
 Company harmless with respect to same.

      3.3  Administrators Taxes. The Company shall have no responsibility for
 any income taxes (or interest or penalties thereon) imposed upon the
 Administrator.

      3.4  Administrator's Name. The Company may not use the name, logo
 or service mark of the Administrator or any of its affiliates in any
 advertising or promotional material without the prior written consent of
 the Administrator.

                                  ARTICLE 4

                                 INDEMNITIES

      4.1  Administrator's Indemnity. The Administrator agrees to indemnify
 the Company, its subsidiaries, successors and assigns, and the shareholders,
 directors, officers, agents and employees of any of them (collectively
 "Company Indemnitees"), against and in respect of any and all claims,
 demands, actions, proceedings, liability, losses, damages (except
 consequential damages), judgments, costs and expenses, including without
 limitation, attorneys' fees, disbursements and court costs, and any loss in
 excess of Policy limits, as well as extra-contractual obligations, including
 but not limited to punitive. exemplary or compensatory damages, suffered
 made or instituted against or incurred by the Company Indemnitees, or any of
 them, and which arise, directly or indirectly, out of or result from; (i)
 bad faith or gross negligence of the Administrator, or its employees or
 representatives in discharging its obligations to the Company or to the
 Policyholders, and/or (ii) any failure by the Administrator, or its
 employees, representatives, independent adjusters or approved subcontractors
 to perform its obligations under or relating to this Agreement; provided
 however that the actions of the Administrator described in subsections (i)
 or (ii) were not taken pursuant to the written instructions of the Company.

      4.2  Company's Indemnity. The Company agrees to indemnity the
 Administrator, its subsidiaries, successors and assigns, and the
 shareholders, directors, officers and employees of any of them (collectively
 "Administrator Indemnitees"), against and in respect of any and all claims,
 demands, actions, proceedings, liability, losses, damages (except
 consequential damages), judgments, costs and expenses, including without
 limitation, attorneys' fees, disbursements and court costs, and any loss in
 excess of Policy limits, as well as extra-contractual obligations, including
 but not limited to punitive, exemplary, or compensatory damages, suffered,
 made or instituted against or incurred by the Administrator Indemnitees, or
 any of them, and which arise, directly or indirectly, out of or result from;
 (1) bad faith or gross negligence of the Company, or its employees or
 representatives in discharging its obligations to the Administrator or to
 the Policyholders, and/or (ii) any failure by the Company, or its employees
 or representatives, to perform its obligations under or relating to this
 Agreement.

      4.3  Survival of Indemnities. The indemnities set forth in this Article
 shall survive any termination of this Agreement.

      4.4  Insurance. Throughout the term of this Agreement, the
 Administrator shall maintain errors and omissions Insurance with a policy
 limit of at least $1,000,000 and a deductible no greater than $500,000,
 under a current paid up policy issued by an insurer reasonably acceptable
 to the Company. A copy of the policy shall be furnished to the Company on
 demand. As a condition precedent to the Company's entering into this
 Agreement, The Millers Insurance Company shall execute and deliver to the
 Company a guarantee of payment of the errors and omissions deductible
 shortfall ("E&O Shortfall") for the initial limit of $450,000 excess
 $50,000. The E&O Shortfall shall thereafter be determined annually and shall
 equal the actual deductible under the errors and omissions policy minus
 $50,000, excess $50,000. The guarantee shall be in the form attached as
 Schedule 3

                                  ARTICLE 5

                             TERM AND TERMINATION

      5. Term. The term of this Agreement shall commence as of the date of
 this Agreement and shall continue until all claims arising under the
 Policies have been closed, unless sooner terminated as provided in this
 Article.

      5.2  Voluntary Termination. This Agreement may be terminated at any
 time by either party, without cause, by giving the other party not less than
 one hundred eighty (180) days prior notice of such termination.

      5.3  Termination for Cause. This Agreement shall terminate:

           (a)  at the election of the Company, upon notice to the
 Administrator, if the Administrator becomes insolvent, if it makes an
 assignment for the benefit of its creditors, if a petition for relief under
 the Bankruptcy Code is filed by or against it, or if a trustee, receiver or
 other custodian of its assets is appointed;

           (b)  at the election of the Company, upon thirty (30) days notice
 to the Administrator, in the event of a Change of Control (as defined in
 Section 7.3), unless (i) the Administrator has provided the notice referred
 to in Section 7.3 and (ii) the Company agrees in writing to such Change of
 Control;

           (c)  at the election of the Company, upon notice to the
 Administrator, if any public authority cancels, declines to renew, or
 suspends, any license or certificate of authority of the Administrator which
 is necessary to the legal performance of its obligations under this
 Agreement;

           (d)  at the election of the Company, upon notice to the
 Administrator, in the event of any material change in the Company's
 obligations under the Policies, or in its business prospects, caused by (i)
 a change in law or insurance regulations or (ii) any suspension, prohibition
 or cease and desist order or decree issued by any public authority having
 jurisdiction;

           (e)  at the election of the Company, upon notice to the
 Administrator, in the event of the cancellation of, or an adverse change in
 the terms, conditions or coverage of the Company's reinsurance agreements
 with respect to the Policies;

           (f) upon the filing by or against the Company of a petition for
 relief under the Bankruptcy Code, or the issuance of an order of liquidation
 or rehabilitation or similar action against the Company by any public
 authority having jurisdiction;

           (g)  at the election of the Company, upon notice to the
 Administrator, if the Administrator commits any of the following acts or
 omissions: fraud, gross negligence, or willful misconduct (which includes
 but is not limited to willful violation of the Company's lawful instructions
 or willful violation of any applicable law, rule or regulation governing or
 relating to the Administrator's performance of services tinder this
 Agreement or the General Agency Agreement);

           (h) at the election of the Company, upon ten (10) days notice, if
 the Administrator breaches any provision of this Agreement or of the General
 Agency Agreement and fails to cure such breach within thirty (30) days after
 notice of the breach is given to the Administrator by the Company. For
 purposes of this Subsection, routine differences in accounting methods of
 the Administrator and the Company which involve minor amounts of money and
 do not involve recoveries collected and knowingly withheld by the
 Administrator, shall not constitute a failure to account and remit funds to
 the Company provided all items not in dispute are paid in accordance with
 the procedures set forth in this Agreement;

           (i)  at the election of the Company. upon thirty (30) clays notice
 to the Administrator, if the Genera] Agents' affiliates, The Millers
 Insurance Company and Millers Casualty Insurance Company, or either of them,
 breach a material covenant of that certain Stop Loss Reinsurance Agreement
 between them and the Company dated as of May 1, 2001; or

           (m) at the election of the Company, upon notice to the
 Administrator, if any of the following entities becomes insolvent, makes an
 assignment for the benefit of its creditors, files or has filed by or
 against it a petition for relief under the Bankruptcy Code, or has a
 trustee, receiver or other custodian of its assets appointed: Millers
 American Group, Inc., Trilogy Holdings, Inc., The Millers Insurance Company,
 Phoenix Indemnity Insurance Company, Millers (General Agency, Inc. or
 Millers Casualty Insurance Company.

      5.4  Procedures Upon Termination. Upon termination of this Agreement
 the Company shall have either of the following options:

           (a)  To assume control of such claim files (whether open or
 closed) as the Company may elect, in which case the Administrator shall
 promptly transfer such claim files to a location specified by the Company.
 The Administrator shall cooperate fully with the Company to effect a
 prompt and orderly transfer of the claim files to the Company or its
 representatives for the purpose, among others, of preventing an increase
 in the Company's liability for claims and loss adjustment expenses.

           (b)  To require the Administrator to continue to administer to a
 conclusion all open claims. The Claims Account, in such case, shall continue
 to he maintained by the Company.

      5.5  Adjustment of Pre-Payment Upon Termination; Indemnity.

           (a)  Upon termination of this Agreement the Company shall pay the
 Administrator for services rendered on a pro rata basis. The Administrator
 shall return to the Company any Unearned Fees within thirty (30) days after
 demand. The final determination of payments owed in accordance with this
 Subsection shall be made by auditors or accountants selected by the Company.

           (b)  If this Agreement terminates for any reason other than a
 voluntary termination by the Company under Section 5.2, and if the Company
 takes back open claim files from the Administrator or assigns the
 administration of such files to a third party, the Administrator agrees to
 indemnify the Company Indemnities against and in respect of all costs and
 expenses related to the administration of claims -

      5.6  Suspension of Administrator's Authority.  The Company may suspend
 the Administrator authority to administer and adjust claims during the
 pendency of any dispute regarding termination of Agreement.

      5.7  No Consequential Damages. Neither the Administrator nor any of its
 employees or representatives shall have or assert any claim against the
 Company, its subsidiaries, successors or assigns, or the shareholders,
 directors, officers, agents or employees of any of them, for loss of
 business, loss of profits, or damage to goodwill or reputation, as a result
 of the termination of this Agreement in accordance with this Article.

                                  ARTICLE 6

                                   NOTICES

      Any notice or other communication hereunder shall be in writing and
 shall be deemed fully made or given  (a) when hand delivered, (b) on the
 business day after it is delivered to a recognized overnight courier service
 for overnight delivery to a party at the address of such party stated below
 (or to such other address as such party may have fixed by notice), or (c)
 three (3) business days after it is mailed to a party, postage prepaid, by
 registered or certified mail, return receipt requested, addressed to such
 party at its address stated below (or to such changed address as such party
 may have fixed by notice):

           To the Administrator:

                Millers General Agency, Inc.
                c/o Millers American Group
                777 Main Street, Suite 1000
                Fort Worth, TX 76102
                Attn:  Joy J. Keller

           To the Company::

                Clarendon National Insurance Company
                1177 Avenue of the Americas
                New York, New York 10036
                Attn:  President

                                  ARTICLE 7

                                MISCELLANEOUS

     7.1 Assignment   . The Administrator shall not assign or otherwise
 transfer this Agreement or any rights hereunder without the prior written
 consent of the Company.

     7.2 Trust Funds.

           (a)  In any action or proceeding brought by the Company to recover
 funds due the Company or the Policyholders under this Agreement
 (collectively "trust funds"), the Administrator shall be obligated to
 account on its own records for such trust funds and to pay the Company all
 sums for which it cannot account. The Company shall be entitled to bring any
 action or proceeding available at law or equity to recover trust funds and
 to assert claims therein, including without limitation, claims for an
 accounting, for breach of contract and for conversion. In any such action or
 proceeding it shall be conclusively presumed that the Administrator is a
 fiduciary of the Company with respect to trust funds and is liable to the
 Company for trust funds which have not been timely paid to the Company or to
 the Claims Account as required by this Agreement; and the Administrator
 waives (i) any right it may have to assert any non-compulsory counterclaim,
 non-compulsory cross-claim, or set-off in the action or proceeding, and (ii)
 the right to trial by jury and any claim that the forum or situs is
 inconvenient. The Administrator shall retain the right to bring any separate
 proceeding it deems appropriate to recover any claims it may have as a
 creditor of the Company, or otherwise, but the pendency of such proceeding
 shall not delay, binder or defeat the Company's right to promptly recover
 any trust funds then due or to levy upon any judgment therefor.

           (b)  As a condition precedent to the Company's entering into this
 Agreement, the ultimate parent company of the Administrator shall execute
 and deliver to the Company a guarantee of payment of the trust funds. The
 guarantee shall be in the form attached as Schedule 2.

      7.3  Change of Control. The Administrator shall notify the Company in
 writing at least thirty (30) days prior to any of the following occurrences,
 each of which shall be deemed a "change of control":

           (a)  A sale, transfer, or the issuance to a new shareholder or
 member, of ten (10%) percent or more of the voting stock or membership
 interests of the Administrator other than to an affiliate of the
 Administrator; or

           (b)  A sale or transfer of a substantial portion of the material
 assets of the Administrator, or any merger or consolidation of the
 Administrator with another entity or entities; or

           (c)  A change in any director or principal officer of the
 Administrator: or

           (d)  An assignment or transfer of this Agreement or any rights
 hereunder by the Administrator.

      7.4  Governing Law; Consent to Jurisdiction. This Agreement shall be
 governed in all respects, including validity, interpretation and effect, by
 the laws of the State of New York applicable to contracts to be performed in
 the State of New York. The parties agree that any action or proceeding,
 however characterized, relating to this Agreement may he maintained in the
 courts of the State of New York sitting in the Borough of Manhattan, City of
 New York or the federal court for the Southern District of New York, and the
 parties hereby irrevocably submit to the non-exclusive jurisdiction of any
 such court for the purposes of any such action or proceeding and irrevocably
 agree to be bound by any judgment rendered by any such court with respect to
 any such action or proceeding. The parties hereby waive any objection they
 may now or hereafter have to the venue of any such action or proceeding in
 any such court and any claim, that such action or proceeding has been
 brought in an inconvenient forum.

      7.5  Waiver of Jury Trial. TO THE FULLEST EXTENT PERMITTED BY LAW, EACH
 CF THE PARTIES HERETO HEREBY WAIVES THEIR RESPECTIVE RIGHTS TO A JURY TRIAL
 OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT
 OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THE
 TRANSACTIONS CONTEMPLATED HEREIN. The scope of this wavier is intended to be
 all-encompassing of any and all disputes that may be filed in any court and
 that relate to the subject matter of this Agreement, including, without
 limitation, contract claims, tort claims, breach of duty claims, and all
 other common law and statutory claims. This waiver shall apply to any
 subsequent amendments, renewals, supplements or modifications to this
 Agreement.

      7.6  No Third Party Benefits. This Agreement is for the sole and
 exclusive benefit of the parties and their successors and permitted assigns,
 and no third party is intended to or shall have any rights hereunder.

      7.7  No Waiver. The failure of either party to insist upon strict
 compliance with any provision of this Agreement, or to exercise any right or
 remedy under this Agreement, shall not constitute a waiver by such party of
 the provision or prevent such party from exercising such right or remedy in
 the future.

      7.8  Entire Agreement. This Agreement and the Schedules attached, sets
 forth the entire understanding of the parties with regard to its subject
 matter, and supersedes and merges all prior discussions, agreements,
 promises, representations, warranties and arrangements between them with
 regard to such subject matter. Neither party shall be bound by any
 agreement, representation or warranty regarding such subject matter other
 than as expressly set forth in this Agreement or in a subsequent writing
 signed by the party to be bound thereby. This Agreement may not be modified
 or supplemented, nor may any provision be waived, except by a writing signed
 by the party to be bound thereby.

      7.9  Severability. If any provision of this Agreement is held to be
 invalid or unenforceable, such impediment shall attach only to such
 provision and shall not render invalid or unenforceable any other provision
 of this Agreement.

      7.10 Headings. The headings used in this Agreement or in any Schedules
 are inserted for convenience only and shall not affect the meaning or
 interpretation of the Agreement.

      7.11 Counterparts. This Agreement may be executed in two or more
 counterparts, each of which shall be deemed an original, but all of which
 together shall be deemed one and the same instrument.

      7.12 Schedules. The Schedules referred to in this Agreement are an
 integral part of and shall be deemed incorporated in, the Agreement.

      7.13 Further Assurances. The parties shall execute and deliver such
 other documents or instruments and take such other action as may be
 reasonably required to more effectively implement the provisions and intent
 of this Agreement.

      7.14 Benefit of Parties. This Agreement shall bind and benefit the
 successors and permitted assigns of the parties.

      7.15 Survival. All of the terms, covenants, agreements obligations,
 conditions, representations and warranties set forth in this Agreement and
 in any document or other writing delivered pursuant hereto, shall survive
 the termination of this Agreement and shall continue in full force and
 effect so long as any liability or obligation under this Agreement is
 outstanding or unpaid.

      IN WITNESS WHEREOF, the parties have caused this Agreement to be
 executed by their duly authorized officers as of the day and year first
 above written.

 Attest:                  MILLERS GENERAL AGENCY, INC
                          By:   /s/
                          Title:

 Attest:                  CLARENDON NATIONAL INSURANCE COMPANY

                          By:   /s/
                          Title

<PAGE>

                                  SCHEDULE 1

 Claim Master Fields Listing

 Claimant Master Fields Listing

 Payment Master Fields Listing

 Start Month Reserves Fields Listing

 End Month Reserves Fields Listing

 Outstanding Checks Fields Listing

                                   SCHEDULE 2

 GUARANTEE OF PAYMENT OF TRUST FUNDS

                                  SCHEDULE 3

 GUARANTEE OF PAYMENT OF THE E&O SHORTFALLEXHIBIT 10 (d)

                          CLAIMS SERVICES AGREEMENT

 This Claim Service Agreement ("Agreement") is made and effective the 25th
 day of March, 2003 (Effective Date) by and between Millers General Agency,
 a Texas Corporation, having its principal place of business at 777 Main
 Street, Suite 1000, Fort Worth, Texas (hereinafter "MGA") and Effective
 Claims Management, Inc., a Texas Corporation, having its principal place
 of business at 777 Main Street, Suite 1000, Fort Worth, Texas (hereinafter
 "ECM') and its successors in interests and shall continue until it is
 terminated as set forth herein.

                                   RECITALS

 WHEREAS MGA entered into a General Agency Agreement dated August 15, 2001
 (hereinafter "Agency Agreement") with Clarendon National Insurance Company
 ("Clarendon") for the issuance and administration of insurance policies in
 certain states (hereinafter "policies"); and

 WHEREAS MGA also entered into a Claim Administration Agreement dated August
 15, 2001 with Clarendon for the administration and adjustment of claims
 arising under the policies (hereinafter "Clarendon Claims Agreement"); and

 WHEREAS MGA desires that certain of the claims administration duties,
 obligations and responsibilities required under the Clarendon Claims
 Agreement be provided by ECM as set forth herein; and

 WHEREAS ECM desires to provide such services; and

 WHEREAS ECM is in the business of providing claim and litigation management
 services related to the property and casualty insurance business and has
 substantial expertise in the administration of claims arising out of similar
 policies; and

 WHEREAS nothing contained in this Agreement shall relieve MGA or Clarendon
 from the fulfillment of any of their respective rights, responsibilities and
 obligations under the Clarendon Claims Agreement; and

 WHEREAS Clarendon has reviewed this subcontract and has approved of its form
 and content as required under Article I, sections 1.2(c) (vii) and 1.8 of
 the Clarendon Claims Agreement and such approval is acknowledged by the
 below signature of Clarendon's authorized representative.

 NOW, THEREFORE, in consideration of the premises set forth below and other
 good and valuable consideration, the receipt and sufficiency of which is
 expressly acknowledged, ECM and MGA hereby agree as follows:

                            STATEMENT OF AGREEMENT

                                  ARTICLE I

                                 DEFINITIONS
                                 -----------

 Unless the context otherwise requires, the terms defined in this Article I
 shall for the purposes of this Agreement, have the meanings herein
 specified:

 1.1  Loss Adjustment Expenses shall mean all Claim adjustment costs and
 expenses incurred by ECM and allocated by ECM to the investigation,
 adjustment and settlement or defense of a Claim for benefits or damages
 under the policies. Such expenses shall include, but are not limited to:
 attorney's fees and disbursements; appraisals, reports, surveys, analyses
 of professionals and experts; automobile and property appraisals; trial
 and hearing attendance fees; reports from government agencies or branches;
 credit bureau reports; extraordinary Claim investigation expense and travel
 expenses incurred at the request of the MGA or Clarendon and any other
 similar cost, fee, or expense for services reasonably related to the
 investigation and defense of a Claim. "Allocated Loss Adjustment Expenses"
 shall not include the salaries and traveling expenses of ECM employees
 except as it relates to reasonable travel expenses incurred when required
 and with customer approval to attend trials, mediations, or arbitrations.

 1.2  Authority Limit shall be defined as the limit of authority contained in
 the Clarendon Claim Agreement and as amended from time to time by Clarendon.

 1.3  Claim or Claims shall mean any monetary demand, occurrence or loss,
 actual or alleged, made against, arising out of or in connection with the
 policies to which this Agreement applies.

 1.4  Claim Services shall mean those Claims services provided hereunder by
 ECM that are described in Article IV of this Agreement.

 1.5  Compensation shall be that amount set forth and described in Article V
 of this Agreement.

 1.6  Policy or Policies shall mean the policy or policies issued by or on
 behalf of Clarendon National Insurance Company under the Agency Agreement
 to which this Agreement applies.

 1.7 Recoveries shall include any and all credits, salvage recoveries,
 overpayments, voided or returned checks, or other recoveries that shall
 be credited to the policies.

                                  ARTICLE II

                               DURATION (TERM)
                               ---------------

 This agreement shall remain in force and effect and shall continue until
 it is cancelled or terminated as provided in the cancellation/termination
 clause set forth below.

                                 ARTICLE III

                               CONFIDENTIALITY
                               ---------------

 ECM shall maintain the confidentiality of data or information which is
 the property of MGA or Clarendon and which is accessible to ECM in the
 implementation and performance of this agreement. ECM shall not disclose
 such data or information without the prior written consent of MGA or
 Clarendon as the case may be. Notwithstanding the preceding sentence,
 MGA and Clarendon agree that ECM may use such data or information for the
 purpose of filing any reports required by any governmental agency or when
 compelled to do so by a valid order of a court or regulatory agency, with
 prior notice to the each.

                                 ARTICLE IV

                               CLAIM SERVICES
                               --------------

 ECM shall perform the following services subject to periodic review and
 audit thereof by MGA, Clarendon, or their authorized representatives
 throughout the term of this Agreement:

 (a)  Using appropriately trained and licensed personnel: investigate,
      evaluate, handle and process each claim reported based on accepted
      industry standards and any written standards and/or requirements
      provided by MGA and/or Clarendon, in accordance with applicable state
      law and the terms and conditions of the policy including responding to
      Department of Insurance inquiries and complaints and settling claims
      within the authority level stated in this Agreement. MGA grants to ECM
      the authority to provide the foregoing claims administration services
      for and on behalf of MGA relating to Clarendon policies; provided,
      however, that ECM will not have any authority to alter, modify or
      discharge any policy or waive any policy provision, exclusion or
      condition.

 (b)  Investigate all reported claims to the extent Millers or Clarendon
      deems necessary.

 (c)  Verify coverage and applicable deductibles on all cases;

 (d)  Determine and evaluate any coverage issues in connection with the
      claims and refer same to Clarendon or counsel with recommendations.

 (e)  Establish appropriate reserves for all claims, subject, however, to
      the right of MGA or Clarendon to adjust the amounts of such reserves
      based upon claim standards.

 (f)  Deny coverage in writing with respect to those claims which the
      Administrator determines should be denied based upon factors
      established by the claims standards as a basis for denying coverage.

 (g)  Adjust, settle and bring to a conclusion those claims which ECM
      determines Clarendon is legally obligated to pay in accordance with
      applicable law, the terms of the policies and the claims standards.

 (h)  Administer the appraisal/assessment process using a combination of
      staff, independent appraisers and direct repair facilities reasonably
      acceptable to MGA and or Clarendon;

 (i)  Perform all reasonable and necessary administrative and clerical work
      in connection with claim or loss reports

 (j)  Establish and maintain a claim file for each reported claim or loss
      containing, among other things, a copy of the declarations page of the
      relevant policy. The claim file will have a daily activity log, which
      will be available for review at any and all reasonable times by MGA or
      its designee subject to the provisions of this Agreement;

 (k)  Record and report each claim promptly to MGA with a recommended
      reserve; and consult with, and seek consent from, MGA and/or Clarendon
      with respect to any of the following:

      (1)  any loss or claim resulting in legal action being instituted
           against the insured, ECM, MGA or Clarendon;

      (2)  any loss or claim causing a complaint to be filed with any
           regulatory authority;

      (3)  any inquiry from any regulatory authority, including but not
           limited to any Insurance department, with respect to any claim
           or claims, even if no complaint causes such inquiry;

      (4)  any claim in which ECM deems appropriate to rescind coverage for
           material misrepresentations, deny policy coverage, or involves a
           coverage dispute;

      (5)  any claim involving an allegation of extra contractual
           obligations, or bad faith claim handling;

      (6)  any claim involving a fatality, major amputation, spinal cord or
           brain damage, loss of eyesight, extensive bums, poisoning, toxic
           exposure, multiple fractures or a minor;

      (7)  any claim that MGA or Clarendon desires to be kept advised of
           during the life of the claim;

      (8)  any claim where there has been a demand for policy limits and ECM
           does not evaluate the value of the claim to include settlement at
           that amount;

      (9)  any claim involving asbestos, pollution, toxic waste and lead or
           paint poisoning;

      (10) any claim having potential subrogation;

      (11) any claim which is very likely to result in the commencement of
           litigation within 30 days;

      (12) any claim involving pharmaceuticals, communicable diseases, rape,
           child molestation or multiple claim food poisoning;

      (13) any claim which might ultimately result in the payment(s) in
           excess of policy limit. In the event of such claim, ECM shall
           forward a copy of the claim file to MGA or Clarendon upon request;
           and

      (14) any claim open for more than six months in accordance with the
           Clarendon Claims Agreement.

  (l) Prepare checks and vouchers, compromises, releases, agreements and any
      other documents reasonably necessary to finalize and close claims. ECM
      will issue payments of claims and loss adjustment expenses only within
      the guidelines as authorized by MGA or its designee.

  (m) Maintain service standards and claims documentation in accordance with
      standards established by MGA. ECM will be in compliance with all state
      regulations dealing with the adjusting and handling of claims. ECM
      will periodically review the development of the claims handling
      procedure with MGA or its designee to identify problems and recommend
      corrective action;

  (n) Diligently pursue and prosecute salvage rights relating to any losses.
      ECM will use reasonable efforts to collect and will deposit funds
      arising from the enforcement of such rights into an appropriate
      account.

  (o) ECM will, at customer's expense, forward closed files to MGA or
      Clarendon, as directed within 45 days after the last feature has been
      closed.

  (p) Maintain in good standing all licenses, permits and authorizations
      necessary or appropriate to perform services under this Agreement in
      compliance with all applicable laws, rules and regulations and shall
      use only public independent adjusters, investigators or appraisers who
      are duly licensed in the states where their services are performed.

  (q) Appoint Independent Counsel from a list approved by MGA and/or
      Clarendon and coordinate a proper defense with such Counsel.

  (r) Report suspected fraud as required by any applicable statue or
      regulation in the state(s) where the policies are issued.

                                  ARTICLE V

                                 COMPENSATION
                                 ------------

 For all services to be rendered by ECM during the term of this Agreement,
 MGA shall pay ECM the same compensation that MGA would otherwise be entitled
 to receive in accordance with Article 2 of the Clarendon Claims Agreement.

                                  ARTICLE VI

                       DUTIES OF MILLERS GENERAL AGENCY
                       --------------------------------

 MGA shall cooperate with ECM to the extent reasonably necessary to
 enable the Administrator to adequately perform claims services under this
 Agreement, including without limitation, responding promptly to ECM's
 requests for relevant policy and underwriting information.

                                 ARTICLE VII

                             ULTIMATE DISCRETION
                             -------------------

 ECM acknowledges and agrees that Clarendon, having ultimate responsibility
 for the claims to be administered by ECM under this Agreement, will at all
 times retain and have ultimate discretion with respect to all issues
 pertaining to such matters.

                                 ARTICLE VIII

                                 INDEMNITIES
                                 -----------

 8.1  MGA agrees that it will indemnify and hold harmless ECM and its
 directors, officers, and employees from and against any and all claims,
 loss, liability, costs, damages, and reasonable attorney's fees incurred by
 ECM as the direct or indirect result of any misconduct, error or omission
 of MGA or any of MGA directors, officers, employees, subsidiaries or
 affiliates, taken in connection, with the furtherance or performance of any
 provision of this Agreement, or as a result of instructions given by MGA or
 Clarendon to ECM, which the latter follows, provided that said claims, loss,
 liability costs, damages, and reasonable attorney's fees have not been
 directly caused by any misconduct, error or omission by ECM, its directors,
 officers, employees, subsidiaries and affiliates.

 8.2  ECM agrees that it will indemnify protect, defend and hold harmless MGA
 and its directors, officers, employees, subsidiaries, and affiliates from
 and against any and all claims, actions, causes of action, loss, liability,
 costs, damages, liabilities, fines, assessments, penalties, liability for
 punitive or exemplary damages, payments, settlements, arbitration awards,
 verdicts and judgements, including reasonable costs and attorney's fees
 (hereinafter "damages") of any kind or nature whatsoever arising out of or
 resulting from thc negligent, willful or intentional acts or omissions of
 ECM or incurred as the director indirect result of any misconduct, error or
 omission of BCM or any of its directors, officers, employees, subsidiaries,
 shareholders, or affiliates, taken in connection with the furtherance of
 performance of any provision of this Agreement, provided that said claims,
 loss, liability, costs, damages, and reasonable attorney's fees have not
 been directly caused by any misconduct, error, or omission of MGA, its
 directors, officers, employees, subsidiaries and affiliates.

 8.3 The indemnities set forth in this Article shall survive any termination
 of this Agreement.

                                 ARTICLE IX

                                 TERMINATION
                                 -----------

 This agreement may be terminated in accordance with this section.

 9.1 Termination. Either party shall have the right to terminate this
 Agreement with or without cause by giving to the other party at least one
 hundred eighty (180) days prior written notice of such termination of this
 Agreement. This Agreement maybe sooner terminated on the first to occur of
 the following:

   (a) Termination by Mutual Agreement. In the event the Parties shall
       mutually agree in writing,  this Agreement may be terminated on the
       terms and dates stipulated therein.
   (b) Non-Payment. In the event that MGA fails to pay when due any
       compensation or other payment due under this Agreement, ECM may
       terminate this Agreement immediately and ECM shall have no further
       obligation to provide services hereunder.
   (c) Uncorrected Material Breach. With respect to any material breach of
       this Agreement, by written notice from the non-breaching Party upon
       a material breach by the other Party of its duties or obligations
       under this Agreement; provided, however, such termination will be
       effective only after (i) such breach remains substantially uncured
       for thirty (30) days after written notice specifying such breach is
       received by the breaching Party; or (ii) with respect to a breach
       that cannot be reasonably cured with a thirty (30) day period, the
       breaching Party fails to take action, reasonably satisfactory to the
       non-breaching Party, necessary to commence curing such breach and
       thereafter fails to proceed with all reasonable efforts to cure
       substantially such breach.
   (d) Bankruptcy. In the event either party makes a general assignment for
       the benefit of creditors or files a voluntary petition in bankruptcy
       or petitions for reorganization or arrangement under the bankruptcy
       laws, of if a petition of involuntary bankruptcy is filed against
       either party and remains undismissed for a period of thirty (30) days,
       or if a receiver or trustee is appointed for all or any part of the
       property and assets of either party, the other party may terminate the
       Agreement immediately.

 9.2 Return of Files. In the event that this Agreement is terminated for any
 reason, BCM agrees that all open and closed files in ECM's actual possession
 will be returned to MGA or its designee. In the event this Agreement is
 terminate by MGA, MGA will be responsible for the pick up and transportation
 of the files. In the event the agreement is terminated by ECM other than
 pursuant to Sections 9.1 (a), (b), (c) or (d), the cost associated with
 the pick up and transportation of the files shall be borne by ECM. If the
 agreement is terminated by mutual agreement, the cost shall be borne equally
 between the parties.

 9.3 Effects of Termination. Except for covenants or other provisions herein
 that by their terms, expressly extend beyond the Term of Agreement, the
 parties' obligations hereunder arc limited to the Term of Agreement. Upon
 termination, ECM will not be required to provide any further services under
 this Agreement.

                                   ARTICLE X

                                   INSURANCE
                                   ---------

 ECM shall maintain in full force and effect during the term and all
 successive terms of this Agreement, a policy or policies of insurance
 covering ECM and its employees in type and amount to be mutually agreed
 upon.

                                  ARTICLE XI

                      ARBITRATION AND EQUITABLE REMEDIES
                      ----------------------------------

 11.1 Arbitration Proceedings. If the Parties have not resolved a monetary
 claim or dispute arising under this Agreement, any Party may submit the
 matter to arbitration. A panel of three arbitrators will conduct the
 arbitration proceedings in accordance with the provisions of the Federal
 Arbitration Act (99 U.S.C. Section 1 et seq.) and the Commercial Arbitration
 Rules of the American Arbitration Association in effect at the time the
 matter is to be arbitrated (the "Arbitration Rules"). The decision of a
 majority of the panel will be the decision of the arbitrators.

 (a) Arbitration Notice. To submit a monetary claim or dispute to
 arbitration, a party will furnish the other party and the American
 Arbitration Association with a notice (the "Arbitration Notice") containing
 (i) the name and address of such party, (ii) the nature of the monetary
 claim or disputed in reasonable detail, (iii) the party's intent to commence
 arbitration proceedings under this Agreement. (iv) the proposed venue of
 the arbitration, and (v) the other information required under the Federal
 Arbitration Act and the Arbitration Rules.

  (b) Selection of Arbitrators. Within ten days after delivery of the
 Arbitration Notice, each party will select one arbitrator from the list
 of the American Arbitration Association's National Panel of Commercial
 Arbitrators. Within ten days after the selection of the last of those two
 arbitrators, those two arbitrators will select the third arbitrator from
 such list. If the first two arbitrators cannot select a third arbitrator
 within such ten day period, the American Arbitration Association will select
 such third arbitrator from the list. Each arbitrator will be an individual
 not subject to disqualification under Rule 19 of the Arbitration Rules.

 (c) Arbitration Final. The arbitration of the matters in controversy and the
 determination of any amount of damages or indemnification will be final and
 binding upon the parties to the maximum extent permitted by law, provided
 that any party may seek any equitable remedy available under law as provided
 in this Agreement. This agreement to arbitrate is irrevocable.

 11.2 Place of Arbitration. Any arbitration proceedings will be conducted in
 Fort Worth, Texas or as the parties may mutually agree. The arbitrators will
 hold the arbitration proceedings within 60 days after the selection of the
 third arbitrator.

 11.3 Equitable Remedies. Notwithstanding anything else in this Agreement
 to the contrary, a party will be entitled to seek any equitable remedies
 available under law. Any such equitable remedies will be in addition to
 any damages or indemnification rights that such party may assert in an
 arbitration proceeding.

 11.4 Judgements. Any arbitration award under this Agreement will be final
 and binding. Any court having jurisdiction may enter judgment on such
 arbitration award upon application of a party.

 11.5 Expenses. If any party commences arbitration proceedings or court
 proceedings seeking equitable relief with respect to this Agreement, the
 prevailing Party in such arbitration proceedings or case may receive as part
 of any award or judgment reimbursement of such Party's reasonable attorney's
 fees and expenses to the extent that the arbitrators or court considers
 appropriate. The Arbitrators will assess the costs of the arbitration
 proceedings, including their fees, to the Parties in such proportions
 as the arbitrators consider reasonable under the circumstances.

 11.6 Exclusivity of Remedies. To the extent permitted by law, the
 arbitration and judicial remedies set forth in this Article will be the
 exclusive remedies available to the Parties with respect to any dispute
 under this Agreement or Claim for damages or indemnification under this
 Agreement.

                                ARTICLE XXII

                                MISCELLANEOUS
                                -------------

 12.1 Amendment. No modification, amendment or supplement to, or waiver of,
 this Agreement or any of its provisions shall be binding upon the parties
 hereto unless made in writing and duty signed by all parties to be charged
 therewith.

 12.2 Relationship of the Parties. This Agreement does not create a
 partnership, joint venture or association; nor does this Agreement, or the
 operations hereunder, create the relationship of lessor and lessee or bailor
 and bailee. Nothing contained in this Agreement or in any agreement made
 pursuant hereto shall ever be construed to create a partnership, joint
 venture or association, or the relationship of lessor and lessee or bailor
 and bailee, or to impose any duty, obligation or liability that would arise
 therefrom with respect to either or both of the parties. Specifically, but
 not by way of limitation, except as otherwise expressly provided for herein,
 nothing contained herein shall be construed as imposing any responsibility
 of ECM for the debts or obligations of MGA or any of its affiliates. It is
 hereby expressly understood that ECM is hereby engaged by MGA to provide
 claim administration and litigation management services as an agent of MGA.
 ECM, its affiliates and designees shall have the right to render similar
 services for other business entities and persons, including its own, whether
 or not engaged in the same business as MGA and may enter into such other
 business activities as ECM and its affiliates, in their sole discretion,
 may determine.

 12.3 No Third Party Beneficiaries. Except as otherwise expressly stated
 herein, this Agreement is solely for the benefit of the parties and no
 other Person will have any fight, interest or claim under this Agreement.

 12.4 General Representations. Each party represents and warrants that on the
 Effective Date: (i) it is a corporation, duly established, validly existing
 and in good standing under the laws of its state or jurisdiction of
 incorporation, with power and authority to carry on the business in which it
 is engaged and to perform its respective obligations under this Agreement;
 (ii) the execution and delivery of this Agreement have been duly authorized
 and approved by all requisite corporate action; (iii) it has all the
 requisite corporate power and authority to enter into this Agreement and to
 perform its obligations hereunder; and (iv) the execution and delivery of
 this Agreement do not, and consummation of the transactions contemplated
 herein will not, violate any of the provisions of its charter or bylaws or
 any applicable state or federal laws applicable to them.

 12.5 Assignability. No party may assign its benefits or delegate its duties
 under this Agreement without the prior written consent of the other party.
 Any attempted assignment or delegation without such prior written consent
 will be void.

 Notwithstanding the foregoing, any party may assign its rights under this
 Agreement to a purchaser of all the assets or equity of such party without
 the other party's consent, and any such purchaser and any subsequent
 purchasers of all of the assets or equity of such party may similarly
 assign or delegate such rights.

 12.6 Notices. All claims, consents, designations, notices, waivers, and
 other communications in connection with this Agreement will be in writing.
 Such claims, consents, designations, notices, waivers, and other
 communications will be considered received (a) on the day of actual
 transmittal when by facsimile with written confirmation of such transmittal,
 (b) on the next business day following actual transmitta1 when transmitted
 by a nationally recognized overnight courier, or (c) on the next business
 day following actual transmittal when transmitted by certified mail, postage
 prepaid, return receipt requested; in each case when transmitted to a party
 at its address set forth below (or to such other address to which such party
 has notified the other parties in accordance with this Section to send such
 claims, consents, designations, notices, waivers, and other communications):

      If to ECM:     Effective Claims Management, Inc.
                     777 Main Street, Suite 1000
                     Fort Worth, Texas
                     Attn: President

      If to Millers: Millers General Agency, Inc.
                     777 Main Street, Suite 1000
                     Fort Worth, Texas 76102
                     Attn: President

 12.7 Waiver. No provision of this Agreement will be considered waived unless
 such waiver is in writing and signed by the party that benefits from the
 enforcement of such provision. No waiver of any provision in this Agreement,
 however, will be deemed a waiver of a subsequent breach of such provision or
 a waiver or a similar provision. In addition, a waiver of any breach or a
 failure to enforce any term or condition of this Agreement will not in any
 way affect, limit or waive a party's rights under this Agreement at any time
 to enforce strict compliance thereafter with every term and condition of
 this Agreement.

 12.8 Binding Effect. This Agreement will be binding upon and will inure to
 the benefit of each party and it heirs, legal representatives, permitted
 assigns, and successors, provided that this Section will not permit the
 assignment or other transfer of this Agreement, whether by operation of
 law or otherwise, if such assignment or other transfer is not otherwise
 permitted under this Agreement.

 12.9 Interpretation. Throughout this Agreement, nouns, pronouns and verbs
 shall be construed as masculine, feminine, neuter, singular or plural,
 whichever shall be applicable. All references herein to "Articles"
 "Sections" and "paragraphs" shall refer to corresponding provisions
 of this Agreement unless otherwise expressly stated herein.

 12.10  Headings. Headings are solely for convenience and ease of reference
 and are not to be considered in the construction or interpretation of any
 provision of this Agreement.

 12.11 Severability. Any provision of this Agreement that is prohibited
 or unenforceable in any jurisdiction will not invalidate the remaining
 provisions of this Agreement of affect the validity or enforceability of
 such provision in any other jurisdiction. In addition, any such prohibited
 or unenforceable provision will be given effect to the extent possible in
 the jurisdiction where such provision's prohibited or unenforceable.

 12.12 Counterparts. This Agreement may be executed in any number of
 counterparts and by different parties hereto in separate counterparts, with
 the same effect as if all parties hereto bad signed the same document. All
 such counterparts shall be deemed an original, shall be construed together
 and shall constitute one and the same instrument. This Agreement may also be
 executed and delivered by exchange of facsimile transmissions of originally
 executed copies.

 12.13 Entire Agreement. This Agreement together will all exhibits and
 schedules, if any, attached hereto constitutes the entire agreement
 between the parties and supersedes all previous agreements, promises,
 representations, understandings, and negotiations whether written or
 oral, between the parties with respect to the subject matter hereof

 12.14 GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF THE
 STATE OF TEXAS REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER THE
 CONFLICTS OF LAWS PRINCIPLES OF SUCH STATE.

 12.15  Force Majeure. The parties will not be liable or deemed to be in
 default for any delay or failure in performance under this Agreement or
 interruption of services resulting directly or indirectly, from acts of
 God, civil or military authority, labor disputes, shortages of suitable
 materials, labor or transportation or any similar cause beyond the
 reasonable control of the parties.

 12.16 Attorney's Fees. In the event of any action, arbitration, claim,
 proceeding or suit between MGA and ECM seeking enforcement of any of the
 terms and conditions of this Agreement, the prevailing party in such action,
 arbitration, claim, proceeding or suit will be awarded its reasonable costs
 and expenses, including its court costs and reasonable attorneys' fees.

 12.17  Agreement to Perform Necessary Acts. Each party agrees to perform
 any further acts and execute and deliver any and all further documents
 and/or instruments, which may be reasonably necessary to carry out the
 provisions of this Agreement and the transactions contemplated hereby.

 12.18 Third Party Beneficiary Status of Clarendon. Clarendon is an
 express third party beneficiary of this Agreement. Except for Clarendon,
 nothing in this Agreement, whether express or implied, is intended or shall
 be construed to confer upon or give to any other person, firm, corporation,
 or legal entity, any rights, remedies, or other benefits under or by reason
 of this Agreement.

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
 executed as the date first above written

                          EFFECTIVE CLAIMS MANAGEMENT, INC.

                          BY:    /s/ Cecil R. Wise
                                 --------------------------
                          Name:  Cecil R. Wise
                                 --------------------------
                          Title: President
                                 --------------------------

                          MILLERS GENERAL AGENCY, NC.

                          By:    /s/ Timothy A. Bienek
                                 --------------------------
                          Name:  Timothy A. Bienek
                                 --------------------------
                          Title: President
                                 --------------------------

 CONTENT AND FORM APPROVED AND CONSENTED TO:

                          CLARENDON NATIONAL INSURANCE CO.

                          By:    /s/ Gerhard Ketels
                                 --------------------------
                          Name:  Gerhard Ketels
                                 --------------------------
                          Title: Secretary
                                 --------------------------

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