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                                                                    EXHIBIT 10.W

                               ONEBEACON INSURANCE
                          DISCOUNTED STOCK OPTION PLAN

     1.   ESTABLISHMENT AND PURPOSE OF THE PLAN. OneBeacon Insurance (the
          "Company") hereby establishes an unfunded plan to be known as the
          OneBeacon Insurance Discounted Stock Option Plan (the "Plan"). The
          purpose of the Plan is to attract and retain key executives by
          providing additional compensation through the grant of options to
          acquire shares.

     2.   DEFINITIONS. As used herein, the following definitions shall apply:

          (a)  "Administrator" shall mean the Committee, or such other person,
               corporation, committee or entity as may be appointed from time to
               time by OneBeacon Insurance to supervise the administration of
               the Plan.

          (b)  "Company" shall mean OneBeacon Insurance

          (c)  "Award Date" shall mean the effective date of the Participant's
               Option Agreement.

          (d)  "Board" shall mean the Board of Directors of OneBeacon Insurance.

          (e)  "Code" shall mean the Internal Revenue Code of 1986, as amended.

          (f)  "Committee" shall mean the Executive Committee of the Board, or
               any other committee appointed by the Board to administer and
               amend the Plan.

          (g)  "Employee" shall mean any employee of the Company.

          (h)  "Option" shall mean an option granted pursuant to this Plan to
               purchase one or more Shares.

          (i)  "Option Agreement" means a written agreement evidencing the award
               of an Option under the Plan.

          (j)  "Participant" shall mean any Employee to whom an Option is
               granted under the Plan.

          (k)  "Plan" shall mean the OneBeacon Insurance Discounted Stock Option
               Plan as set forth herein, as amended from time to time.

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          (l)  "Shares" shall mean the shares of mutual funds, shares of common
               or preferred stock of a corporation listed or reported on a
               national securities exchange or quotation system, or shares of a
               regulated investment company. The Company retains the right to
               restrict the mutual funds that are available for the issuance and
               exchange of option awards under this plan to those that are
               offered by a third party administrator selected by the Company.
               In no instance, however, may Shares include units of any money
               market funds or other cash equivalents. Shares subject to
               purchase pursuant to any Option shall also include any earnings
               on such shares subsequent to the Award Date.

     3.   TERM OF PLAN. The Plan shall become effective on the date it is
          adopted by the Company and shall continue in effect until terminated
          pursuant to paragraph 19.

     4.   SHARES SUBJECT TO OPTION EXERCISE. The aggregate number and types of
          Shares available for exercise pursuant to an Option will be designated
          in the Option Agreement.

     5.   ELIGIBILITY. Eligibility to participate hereunder shall be limited to
          those Employees who meet the following requirements:

                    (a)   The Employee is a member of the select group of
                    management or highly compensated Employees of the Company,
                    and

                    (b)   The Employee is designated as eligible by the
                    Administrator to receive Options under the Plan.

     6.   GRANT OF OPTIONS. The Administrator shall authorize the grant of
          Options under the Plan from time to time. The Administrator, in its
          sole discretion, is authorized to select the eligible Employees who
          will receive Options and to determine the number of Options and the
          number of Shares under each Option. Options shall be granted by the
          Company and evidenced by written Option Agreements containing such
          terms and conditions as are approved by the Administrator. The
          Administrator shall authorize one or more individuals who shall have
          the authority to execute Option Agreements on behalf of the Company.

     7.   DATE OF GRANT OF OPTIONS. The date of grant of an Option under the
          Plan shall, for all purposes, be the date selected by the
          Administrator as the Award Date of the Option, as indicated in the
          Option Agreement.

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     8.   OPTION PRICE. The Option Price for each Share shall be the greater of:
          a) 50 percent of the fair market value of a Share at the date of
          exercise, or, b) 25 percent of the fair market value of a Share on the
          date of grant of the Option. Fair market value on any day of reference
          shall be the closing price of the Share on such date, unless the
          Administrator, in its sole discretion shall determine otherwise in a
          fair and uniform manner. For this purpose, the closing price of the
          Share on any business day shall be (i) if the Share is listed or
          admitted for trading on any United States national securities
          exchange, the last reported sale price of Share on such exchange, as
          reported in any newspaper of general circulation, (ii) if the Share is
          not listed or admitted for trading on any United States national
          securities exchange, the average of the high and low sale prices of
          the Share for such a day reported on The Nasdaq SmallCap Market or a
          comparable consolidated transaction reporting system, or if no sales
          are reported for such day, such average for the most recent business
          day within five business days before such day which sales are
          reported, or (iii) if neither clause (i) or (ii) is applicable, the
          average between the lowest bid and highest asked quotations for the
          Share on such day as reported by The Nasdaq SmallCap Market or the
          National Quotation Bureau, Incorporated, if at least two securities
          dealers have inserted both bid and asked quotations for the Share on
          at least 5 of the 10 preceding business days.

     9.   DIVIDENDS AND CAPITAL GAINS. Dividends and capital gains realized on
          optioned Shares shall be deemed to create additional Shares subject to
          the respective Participant's Option Agreement and the exercise price
          for such Shares shall be the greater of: a) 50% of the fair market
          value on the date of exercise, or b) 25 percent of the fair market
          value on the date the dividend or capital gain distribution is
          declared. For example, assume options are granted to purchase 1,000
          Shares with an initial value of $25 per Share. The total value of the
          Shares is $25,000 and the net after exercise value to the Participant
          is $12,500. If a dividend of $1 per share is declared while the Option
          is outstanding and the underlying Share is trading at $50 per Share,
          an additional 20 Shares ($1 X 1,000 shares = $1,000 / $50 per share =
          20 shares) will be deemed credited to the option award. The option
          award value at $50 per Share would now total $51,000 (1,020 shares X
          $50 per share) and the net after exercise value would be $25,500 (50%
          of the total value at exercise in this example). However, while the
          minimum exercise price on the original 1,000 shares remains at $6.25
          (25% of the $25), the minimum exercise price on the 20 Shares
          resulting from the dividend will be $12.50 (25% of $50).

     10.  EXERCISE. Except as otherwise provided in an Option Agreement, all
          Options granted under the Plan will be vested at grant and therefore
          may be exercisable immediately.

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          The Option may be exercised in full or in part from time to time
          within a period not to exceed thirty (30) years from the date of the
          grant as determined by the Option Agreement.

          Officers subject to section 162(m) limitations may not exercise
          options under this plan if it creates compensation that would not be
          deductible under 162(m).

          In addition, all Options granted under the Plan may only be exercised
          subject to any other terms specified in the Option Agreement and if
          such terms conflict with the terms of this Plan, the terms of the
          Option Agreement control.

     11.  LIMITATIONS ON OPTION DISPOSITION. Any Option granted under the Plan
          and the rights and privileges conferred therewith shall not be sold,
          transferred, encumbered, hypothecated or otherwise anticipated by the
          Participant other than by gift to any member of the Participant's
          immediate family (or a trust established by the Participant for the
          benefit of the Participant and/or any member of the Participant's
          immediate family) or by will or the laws of descent and distribution.
          Any person or entity to whom an Option is duly transferred in
          accordance with the preceding sentence shall hold the Option subject
          to all of the terms and conditions of the Plan and the Participant's
          Option Agreement and shall execute and deliver to the Company such
          documents as the Company may reasonably require to acknowledge that
          the Option remains subject to the Plan and such Option Agreement.
          Options shall not be subject to, in whole or in part, the debts,
          contracts, liabilities, or torts of the Participant, nor shall they be
          subject to garnishment, attachment, execution, levy or other legal or
          equitable process.

     12.  LIMITATIONS ON OPTION EXERCISE AND DISTRIBUTION. In the event that the
          listing, registration or qualification of an Option or Shares on any
          securities exchange or under any state or federal law, or the consent
          of approval of any governmental regulatory body, or the availability
          of any exemption therefrom, is necessary as a condition of, or in
          connection with, the exercise of an Option, then the Option shall not
          be exercised in whole or in part until such listing, registration,
          qualification, consent or approval has been effected or obtained.
          Notwithstanding any provision of the Plan to the contrary, the Company
          shall have no obligation or liability to deliver any Shares under the
          Plan unless such delivery would comply with all applicable laws and
          all applicable requirements of any securities exchange or similar
          entity.

     13.  OPTION FINANCING. Upon the exercise of any Option granted under the
          Plan, the Participant may instruct the Company to sell or deem to sell
          a

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          number of Shares otherwise deliverable to the Participant and
          attributable to the exercise of the Option in order to pay the
          exercise price of the Option. The Company may, in its sole discretion,
          make financing available to the Participant to facilitate the exercise
          of the Option, subject to such terms as the Company may specify.

     14.  WITHHOLDING OF TAXES. The Administrator may make such provisions and
          take such steps as it may deem necessary or appropriate for the
          withholding of any taxes which the Company is required by any law or
          regulation of any governmental authority, whether federal, state or
          local, domestic or foreign, to withhold in connection with any Option
          including, but not limited to, the withholding of the issuance of all
          or any portion of such Shares until the Participant reimburses the
          Company for the amount the Company are required to withhold with
          respect to such taxes, canceling any portion of such issuance in an
          amount sufficient to reimburse itself for the amount it is required to
          so withhold, or taking any other action reasonably required to satisfy
          the Company's withholding obligation.

     15.  MODIFICATION OF OPTION. At any time and from time to time the
          Administrator may modify, extend, or renew or terminate any
          outstanding Option; provided, however, no such modification,
          extension, renewal or termination shall impair the rights of any
          Participant except to the extent necessary to comply with applicable
          federal or state laws or regulations, or with regulatory requirements,
          and in such event the Administrator may require immediate exercise of
          any outstanding option, and the Company may take other appropriate
          action as it deems necessary to cause the affected Participant to be
          made whole financially.

     16.  SUBSTITUTION OF OPTION. If a Participant has been granted an Option to
          purchase Shares under an Option Agreement, then except as limited by
          the terms of the Option Agreement, the Participant may direct that the
          Option be converted into an Option to purchase other Shares as
          permitted by the Option Agreement. Such substitution shall only be
          allowed to the extent that, immediately following the substitution,
          the difference between the fair market value of the Shares subject to
          the substituted Option and the exercise price of the substituted
          Option is no greater than the difference which existed immediately
          prior to the substitution between the fair market value of the Shares
          subject to the original Option and the exercise price of the original
          Option. In no event shall a participant be permitted to make
          substitutions more often than once per calendar quarter..

     17.  ADMINISTRATION OF THE PLAN. The Administrator, in its sole discretion,
          is authorized to interpret the Plan, to prescribe, amend and rescind
          rules and regulations relating to the Plan and to the Options granted
          under the Plan,

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          to determine the form and content of Options to be issued under the
          Plan, and to make such other determinations and exercise such other
          power and authority as may be necessary or advisable for the
          administration of the Plan. No fee or compensation shall be paid to
          any Employee who provides services as the Administrator. The
          Administrator in its sole discretion may delegate and pay compensation
          for services rendered relating to the ministerial duties of plan
          administration including, but not limited to, selection of investments
          available under the Plan. Any determination made by the Administrator
          pursuant to the powers set forth herein are final, binding and
          conclusive upon each Participant and upon any other person affected by
          such decision, subject to the claims procedure hereinafter set forth.
          The Administrator shall decide any question which may arise regarding
          the rights of Employees, Participants and beneficiaries, and the
          amounts of their respective interests, adopt such rules and to
          exercise such powers as the Administrator may deem necessary for the
          administration of the Plan, and exercise any other rights, powers or
          privileges granted to the Administrator by the terms of the Plan. The
          Administrator shall maintain full and complete records of its
          decisions. Its records shall contain all relevant data pertaining to
          the Participant and his rights and duties under the Plan. The
          Administrator shall have the duty to maintain Account records or all
          Participants. The Administrator shall cause the principal provisions
          of the Plan to be communicated to the Participants, and a copy of the
          Plan and other documents shall be available at the principal office of
          the Company for inspection by the Participants at reasonable times
          determined by the Administrator.

     18.  CONTINUED EMPLOYMENT NOT PRESUMED. Nothing in the Plan or any document
          describing it nor the grant of an Option via an Option Agreement shall
          give any Participant the right to continue in employment with the
          Company or affect the right of the Company to terminate the employment
          of any such person with or without cause.

     19.  AMENDMENT AND TERMINATION OF THE PLAN. The Company, in its sole
          discretion, may suspend or terminate the Plan at any time or from time
          to time. The Administrator, in its sole discretion, may amend the Plan
          at any time or from time to time. No amendment, suspension, or
          termination shall impair the rights of any Participant under an
          outstanding Option Agreement except as provided above in Section 15.

     20.  GOVERNING LAW. The Plan shall be governed by and construed in
          accordance with the laws of the Commonwealth of Massachusetts.

     21.  SEVERABILITY OF PROVISIONS. Should any provision of the Plan be
          determined to be invalid, illegal or unenforceable, such invalidity,

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          illegality or unenforceability shall not affect the remaining
          provisions of the Plan, but shall be fully severable, and the Plan
          shall be construed and enforced as if such provision had never been
          inserted herein.

     22.  HEDGE OF LIABILITY CREATED BY THE PLAN. At the sole discretion of the
          Company, the liability created by the exercise of the Options issued
          pursuant to the Plan may be offset by the Company entering into a
          hedging transaction. The hedging transaction may consist of the
          Company purchasing all of part of the Shares subject to the Options
          issued pursuant to the Plan, at date of grant of the Options or at any
          time during the Option exercise period. Nothing herein shall be
          construed to require the Company or the Administrator to maintain any
          fund or to segregate any amount for the benefit of any Participant,
          and no Participant or other person shall have any claim against, right
          to, or security of other interest in, any fund, account or asset of
          the Company from which any payment under the Plan or pursuant to a
          Option Agreement may be made.

     23.  CLAIMS PROCEDURE. In general, any claim for benefits under the Plan
          shall be filed by the Participant or beneficiary ("claimant") on the
          form prescribed for such purpose with the Administrator. If a claim
          for benefits under the Plan is wholly or partially denied, notice of
          the decision shall be furnished to the claimant by the Administrator
          within a reasonable period of time after receipt of the claim by the
          Administrator. The claims procedure shall be as follows:

               (a)  Any claimant who is denied a claim for benefits shall be
                    furnished written notice setting forth:

                    (i)   the specific reason or reasons for the denial;

                    (ii)  specific reference to the pertinent provision of the
                          Plan upon which the denial is based;

                    (iii) a description of any additional material or
                          information necessary for the claimant to perfect the
                          claim; and

                    (iv)  an explanation of the claim review procedure under the
                          Plan.

               (b)  In order that a claimant may appeal a denial of a claim, the
                    claimant's duly authorized representative may:

                    (i)   request a review by written application to the
                          Administrator, or its designate, no later than sixty
                          (60)

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                          days after receipt by the claimant of written
                          notification of denial of a claim;

                    (ii)  review pertinent documents; and

                    (iii) submit issues and comments in writing.

               (c)  A decision on review of a denied claim shall be made not
                    later than sixty (60) days after receipt of a request for
                    review, unless special circumstances require an extension of
                    time for processing, in which case a decision shall be
                    rendered within a reasonable period of time, but not later
                    than one hundred and twenty (120) days after receipt of a
                    request for review. The decision on a review shall be in
                    writing and shall include the specific reason(s) for the
                    decision and the specific reference(s) to the pertinent
                    provisions of the Plan on which the decision is based.

     24.  DESIGNATION OF BENEFICIARY. A Participant, by filing the prescribed
          form with the Administrator (See Appendix A), may designate one or
          more beneficiaries and successor beneficiaries who shall be given the
          right to exercise Options and thereby receive Shares or other
          distributions related to the Options from the Plan in accordance with
          the terms of the Plan in the event of the Participant's death. In the
          event the Participant does not file a form designating one or more
          beneficiaries, or no designated beneficiary survives the Participant,
          the Option shall be exercisable by the individual to whom such right
          passes by will or the laws or descent and distribution.

     25.  INTENT. The Plan is intended to be unfunded and maintained by the
          Company solely to provide options to a select group of management or
          highly compensated employees as such group is described under Sections
          201(2), 301(a)(3), and 401(a)(1) of the Employee Retirement Income
          Security Act of 1974 ("ERISA") as interpreted by the U.S. Department
          of Labor. The Plan is not intended to be a plan described in Sections
          401(a) or 457 of the Code. The obligation of the Company to deliver
          Shares subject to the Options granted under this Plan constitutes
          nothing more than an unsecured promise of the Company to fulfill such
          obligations and any property of the Company that may be set aside to
          permit it to fulfill such obligations under the Plan shall, in the
          event of the Company bankruptcy or insolvency, remain subject to the
          claims of the Company general creditors until such Options are
          exercised.

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                                                                    EXHIBIT 10.Y

                    This  EMPLOYMENT  AGREEMENT  (this  "AGREEMENT") is made and
               entered into as of the date of the Acquisition (as defined below)
               between TACK  ACQUISITION  COMPANY,  a Delaware  corporation (the
               "ACQUISITION  COMPANY"),  and JOHN D. GILLESPIE,  an  individual
               resident of the State of Connecticut (the "EXECUTIVE").

          WHEREAS White Mountains Insurance Group, Ltd., a Bermuda company
("WHITE MOUNTAINS"), has entered into an agreement to purchase (the
"ACQUISITION") CGU Corporation, a Delaware corporation ("CGU"), through the
Acquisition Company, a subsidiary of White Mountains; and

          WHEREAS the Acquisition Company wishes to employ the Executive and the
Executive wishes to accept such employment on the following terms and conditions
effective as of January 1, 2001.

          NOW, THEREFORE, in consideration of the mutual covenants contained
herein and intending to be legally bound hereby, the parties hereto hereby agree
as follows:

          SECTION 1. EMPLOYMENT. The Acquisition Company hereby employs the
Executive and the Executive accepts employment by the Acquisition Company, on
the terms and conditions contained in this Agreement.

          SECTION 2. TERM. The employment of the Executive pursuant hereto shall
commence on January 1, 2001 (the "COMMENCEMENT DATE"), and shall remain in
effect until terminated by the Executive upon 30 days' prior written notice to
the Acquisition Company or by the Acquisition Company upon 30 days' prior
written notice to the Executive; provided, however, that if this Agreement shall
be terminated by the Executive, the Acquisition Company shall have the option to
hire the Executive as an investment consultant for a period of one month,
commencing with the first day following such termination, and thereafter for
successive one-month periods not to exceed 12 months in aggregate, on terms and
conditions to be determined by the parties hereto upon the exercise of such
option; provided, however, that the Executive shall receive compensation for his
services as a consultant at a rate of no less than $80,000 per month.
Notwithstanding any of the foregoing provisions to the contrary, if the
Acquisition shall not occur prior to March 31, 2001, or any later date
determined by the parties to the Acquisition to be necessary for any regulatory
approval of the Acquisition as may be required, this Agreement shall not take
effect unless the parties hereto mutually agree otherwise. The period of time
between the Commencement Date and the termination of this Agreement pursuant to
its terms is herein referred to as the "AGREEMENT TERM".

          SECTION 3. DUTIES AND EXTENT OF SERVICE. During the Agreement Term,
the Executive shall be employed by the Acquisition Company in an executive
capacity as mutually agreed upon by the Executive and the Acquisition Company,
and shall be responsible for managing the investment and the allocation of the
assets and capital of CGU. The Executive shall conduct any activities in
connection with his responsibilities hereunder in accordance with

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general guidelines mutually agreed upon from time to time between the Executive
and the Chief Executive Officer of the Acquisition Company (the "CEO") and the
Executive shall report directly to the CEO. The Executive shall devote his full
business knowledge, skill, time and effort to the performance of his duties for
the Acquisition Company and the promotion of its interests (except as provided
in Section 8 hereof). The conduct of the Executive's responsibilities hereunder
shall be performed at such place or places as the interests, needs, businesses
or opportunities of the Acquisition Company shall require; provided, however,
the Executive shall not be required to change his residence from Connecticut to
any other location and shall continue to perform his responsibilities hereunder
while residing in Connecticut and traveling to Boston, Massachusetts, as
necessary, where CGU's headquarters are located, and traveling to Hanover, New
Hampshire, where White Mountains' visiting executive offices are located.

          SECTION 4. BASE SALARY. During the Agreement Term, the Executive shall
be paid a base salary (the base salary each year is hereinafter referred to as
the "BASE SALARY") at a rate of $400,000 per annum (the "INITIAL SALARY"),
subject to annual review; provided, however, that the Base Salary shall not be
reduced below the Initial Salary at any time during the Agreement Term.

          SECTION 5. INCENTIVE COMPENSATION. (a) The Executive may receive an
annual bonus (the "BONUS") of up to 200% of the Base Salary, to be determined
based on the achievement of specific objectives established by the Board of
Directors of the Acquisition Company (the "BOARD") on an annual basis. The
target bonus for the Executive shall be 50% of the Base Salary. The Bonus for
any year shall be paid at the same time bonuses are paid to other executives of
the Acquisition Company.

          (b) From time to time during the Agreement Term, the Executive shall
be granted a number of performance shares of White Mountains equal to no less
than 75% of the number of such performance shares granted to Ray Barrette, or
his successor, based on the same goals and subject to the same terms and
conditions established for the other management executives of the Acquisition
Company, specifically the CEO and Mr. Barrette, or his successor.

          SECTION 6. FRINGE BENEFITS. The Executive shall be entitled to
participate, to the extent eligible, in such medical, dental, disability, life
insurance, deferred compensation and other benefit plans (such as pension and
profit sharing plans) as the Acquisition Company shall maintain for the benefit
of employees generally, on the terms and subject to the conditions set forth in
such plans from time to time during the Agreement Term. The Executive shall also
be entitled to vacation time and sick leave in accordance with the Acquisition
Company's policies in existence from time to time during the Agreement Term for
other executives of the Acquisition Company.

          SECTION 7. EXPENSES. The Acquisition Company shall reimburse the
Executive promptly for all reasonable expenses incurred by the Executive in
accordance with the Acquisition Company's policy in connection with the
Executive's performance of his responsibilities hereunder, including expenses
incurred in respect of the Executive's travel to and

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from his home, or to and from his business office, in Connecticut to and from
Boston, Massachusetts, or to and from Hanover, New Hampshire.

          SECTION 8. PROSPECTOR PARTNERS AND AFFILIATES. Notwithstanding any
provision herein to the contrary, the Executive shall have the right to continue
his ownership and active involvement with the investment management and other
activities of (i) Prospector Associates, L.L.C. ("PROSPECTOR ASSOCIATES"), (ii)
Prospector Partners, L.L.C. ("PROSPECTOR PARTNERS"), including the investment
management of Prospector Partners Fund, L.P., Prospector Partners Small Cap
Fund, L.P., Prospector Offshore Fund (Bermuda), Ltd., and any other fund and any
separate account that it shall have been managing on the date of this Agreement
or that it shall manage during the Agreement Term (hereinafter any such funds
shall collectively be referred to as the "FUNDS" and individually referred to as
a "FUND" and any such accounts shall collectively be referred to as the
"SEPARATE ACCOUNTS" and individually referred to as a "SEPARATE ACCOUNT"), and
(iii) his ownership interests and investment management activities in connection
with the Connecticut Fund Business (as hereinafter defined), so long as the
Executive continues to devote the requisite time required to discharge his
responsibilities hereunder. Additionally, the Executive shall have the right to
delegate tasks necessary or desirable in connection with his performance of his
responsibilities and duties hereunder to employees of Prospector Partners. In
consideration of the foregoing, the Acquisition Company and the Executive agree
as follows:

          (a)  BUSINESS OPPORTUNITIES. During the Agreement Term, the Executive
     shall use his best efforts to determine when an investment opportunity
     meets the criteria of the Acquisition Company as well as any of the Funds
     or Separate Accounts. In the event that the Executive makes such a
     determination, each Fund and Separate Account shall first be given the
     opportunity to invest in such opportunity to the extent such opportunity
     shall be consistent with the policies of such Fund or Separate Account,
     and, after any such investments shall be made, the Acquisition Company
     shall be given the opportunity to invest in such opportunity. Upon the sale
     of any interest in any such investment opportunity in which the Acquisition
     Company and any Fund or Separate Account shall have invested, the proceeds
     of such sale shall be distributed to such Funds, Separate Accounts and the
     Acquisition Company as mutually agreed upon to be equitable at the time of
     such sale.

          (b)  INDEMNIFICATION. The Executive, each other member or employee of
     Prospector Partners or Prospector Associates, each of the Funds and each
     Separate Account (hereinafter collectively referred to as the
     "INDEMNITEES") shall be indemnified and held harmless by the Acquisition
     Company and by White Mountains, jointly and severally, from and against any
     and all loss, liability and expense, not to exceed, in aggregate, $2
     million (including all attorneys' fees, judgments, fines and amounts paid
     or to be paid in settlement), including but not limited to all loss,
     liability and expense in respect of any Federal or State governmental
     regulation imposed on or applied to any of the Indemnitees incurred or
     suffered as a result of this Agreement or in connection with the
     Executive's performance of his responsibilities hereunder; provided,
     however, that this paragraph (i) shall apply only to the first occurrence
     of any loss, liability and expense for which the Executive shall request
     compensation from the Acquisition Company

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                                                                               4

     and/or White Mountains for the Indemnitees and (ii) shall not apply to any
     loss, liability or expense resulting from the gross negligence or willful
     misconduct of the Executive, any member or any employee or affiliate of
     Prospector Partners or Prospector Associates.

The "CONNECTICUT FUND BUSINESS" shall mean the business activities of the
Connecticut Fund Business Entities (as hereinafter defined) in respect of
investments under the Connecticut Insurance Reinvestment Act No. 97-292. The
"CONNECTICUT FUND BUSINESS ENTITIES" shall include: (i) Insurance Capital
Partners, LLC; (ii) Olmstead Capital Partners, LLC; (iii) Prospector Capital
Management, LLC; (iv) Prospector Partners CT Fund Investment Management, LLC;
and (v) Prospector Capital Management II, LLC.

          SECTION 9. NONDISCLOSURE. The parties hereto agree that during the
course of the Executive's employment by the Acquisition Company, the Executive
will have access to, and will gain knowledge with respect to the Acquisition
Company's Confidential Information (as defined below). The parties acknowledge
that unauthorized disclosure or misuse of such Confidential Information would
cause irreparable damage to the Acquisition Company. Accordingly, the Executive
agrees to the nondisclosure covenants in this Section 9. The Executive agrees
that he shall not (except as may be required by law), without the prior written
consent of the Acquisition Company during his employment with the Acquisition
Company under this Agreement and thereafter for so long as it remains
Confidential Information, use or disclose, or knowingly permit any unauthorized
person to use, disclose or gain access to, any Confidential Information;
provided, however, that the Executive may disclose Confidential Information to a
person to whom disclosure is reasonably necessary or appropriate in connection
with the performance by the Executive of his duties under this Agreement. Upon
termination of this Agreement for any reason, the Executive shall return to the
Acquisition Company the original and all copies of all documents and
correspondence in his possession relating to the business of the Acquisition
Company or any of its affiliates, including but not limited to all Confidential
Information, and shall not be entitled to any lien or right of retention in
respect thereof. "CONFIDENTIAL INFORMATION" shall mean all information (whether
or not in written form) that relates to the regular business activities of the
Acquisition Company, any of its affiliates or their respective operations,
products or services, and which is not known to the public generally, including
but not limited to technical information or reports; trade secrets; unwritten
knowledge and "know-how"; business strategies and philosophies; client or
consumer lists; client service records or consumer product records; premium
volume records; investment records; investment and risk management strategies;
product development, marketing and sales strategies; market surveys; marketing
plans; profitability analyses; long-range plans; information relating to
premiums, fees, competitive strategies and new product or service development;
information relating to any forms of compensation and other personnel-related
information; contracts; and underwriter or trading partners lists.

          SECTION 10. SEVERANCE. If this Agreement shall be terminated for any
reason, the Executive shall be entitled to: (i) a lump sum cash payment of any
portion of the Base Salary for the year in which such termination occurs that
shall not have been received by the Executive prior to such termination; (ii)
any annual bonus awarded but not yet paid; and (iii) a cash payment equal to the
market value of any performance shares of White Mountains previously

<Page>

                                                                               5

granted to the Executive under paragraph (b) of Section 5 hereof, the applicable
performance period of which shall not then have ended, pro rated based on the
achievement of or the progression toward previously established specific
performance criteria for that portion of such performance period that shall
precede such termination.

          SECTION 11. TERMINATION; SURVIVAL. This Agreement shall terminate upon
the earlier of (i) the termination by the Executive of the Executive's
employment and (ii) the termination by the Acquisition Company of the
Executive's employment. Notwithstanding the foregoing, Sections 9, 10 and 12
hereof shall survive the termination of this Agreement.

          SECTION 12. MISCELLANEOUS. (a) This Agreement shall inure to the
benefit of (i) the Executive and his executors, administrators, heirs, personal
representatives and permitted assigns, (ii) the Acquisition Company and its
successors and permitted assigns and (iii) White Mountains and its successors
and permitted assigns; provided, however, that except as provided herein, the
Executive shall not be entitled to assign or delegate any of his rights or
obligations hereunder without the prior written consent of the Acquisition
Company.

          (b)  This Agreement shall be deemed to be made in, and in all respects
shall be interpreted, construed and governed by and in accordance with, the laws
of the State of New York, without regard to the conflicts of law principles of
such State. No provision of this Agreement or any related document shall be
construed against or interpreted to the disadvantage of any party hereto by any
court or other governmental or judicial authority by reason of such party having
or being deemed to have structured or drafted such provision.

          (c)  This Agreement constitutes the entire agreement between the
Acquisition Company and the Executive with respect to the Executive's employment
by the Acquisition Company and, effective as of the Commencement Date,
supersedes all prior agreements, if any, whether written or oral, between them,
relating to the Executive's employment by the Acquisition Company.

<PAGE>

                                                                               6

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

                                              TACK ACQUISITION COMPANY,

                                              by
                                                 -------------------------------
                                                 Name:
                                                 Title:

                                                --------------------------------
                                                        John D. Gillespie

                                              White Mountains Insurance Group,
                                              Ltd., as to the provisions of
                                              paragraph (b) of Section 5 hereof,
                                              paragraph (b) of Section 8 hereof
                                              and Sections 10 and 12 hereof:

                                              WHITE MOUNTAINS INSURANCE GROUP,
                                              LTD.,

                                              by
                                                 ------------------------------
                                                 Name:
                                                 Title:

                                              Prospector Partners, L.L.C., and
                                              Prospector Associates, L.L.C., as
                                              to the provisions of Section 8
                                              hereof:

                                              PROSPECTOR PARTNERS, L.L.C.,

                                              by
                                                 ------------------------------
                                                 Name:
                                                 Title:

                                              PROSPECTOR ASSOCIATES, L.L.C.,

                                              by
                                                 ------------------------------
                                                 Name:
                                                 Title:

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