ASSUMPTION AND INDEMNITY REINSURANCE AGREEMENT by and between ZENITH INSURANCE COMPANY and RISCORP NATIONAL INSURANCE COMPANY Dated as of April 1, 1998 TABLE OF CONTENTS

EXHIBIT 10.5

EXECUTION COPY

ASSUMPTION AND INDEMNITY
REINSURANCE AGREEMENT

by and between

ZENITH INSURANCE COMPANY

and

RISCORP NATIONAL INSURANCE COMPANY

Dated as of April 1, 1998

TABLE OF CONTENTS

PAGE

ARTICLE I
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE II
BUSINESS REINSURED. . . . . . . . . . . . . . . . . . . . . . . . . . . .3

ARTICLE III
ASSUMPTION CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . . . .4

ARTICLE IV
POLICY ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . .5

ARTICLE V
CONSIDERATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

ARTICLE VI
RESERVES; CREDIT FOR REINSURANCE . . . . . . . . . . . . . . . . . . . .6

ARTICLE VII
ASSIGNMENT OF CEDED REINSURANCE AGREEMENTS. . . . . . . . . . . . . . . .7

ARTICLE VIII
INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

ARTICLE IX
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

ARTICLE X
ACCOUNTING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE XI
TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

ARTICLE XII
INSOLVENCY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

ARTICLE XIII
OFFSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

ARTICLE XIV
RIGHTS WITH RESPECT TO QUOTA SHARE POLICIES . . . . . . . . . . . . . . 12

ARTICLE XV
ARBITRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

ARTICLE XVI
TERRITORY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE XVII
TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE XVIII
MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . . . . . . . . . . . 14

SCHEDULE 3.2. - STATE REQUIREMENTS FOR TRANSFER AND NOVATION OF INSURANCE
CONTRACTS

SCHEDULE 7.1-A ASSIGNED REINSURANCE CONTRACTS

SCHEDULE 7.1-B ASSUMED REINSURANCE CONTRACTS

EXHIBIT A POLICYHOLDER NOTICE

EXHIBIT B EXPIRED POLICY NOTICE

EXHIBIT C CLAIMANT NOTICE

ASSUMPTION AND INDEMNITY REINSURANCE AGREEMENT

THIS ASSUMPTION AND INDEMNITY REINSURANCE AGREEMENT (this
"Agreement"), dated as of 12:01 a.m. New York City Time on April 1, 1998 (the
"Effective Date"), is made by and between ZENITH INSURANCE COMPANY, a stock
insurance company organized under the laws of the State of California
("Zenith"), and RISCORP NATIONAL INSURANCE COMPANY, a stock insurance company
organized under the laws of the State of Missouri (the "Company").

WHEREAS, Zenith and the Company have entered into the Purchase
Agreement (as defined below); and

WHEREAS, the Purchase Agreement provided for Zenith and the Company to
enter into an indemnity reinsurance agreement;

WHEREAS, the parties have agreed to amend the Purchase Agreement to
provide for Zenith and the Company to enter into an assumption reinsurance
agreement;

WHEREAS, Zenith and the Company are entering into this Agreement
pursuant to the Purchase Agreement, as so amended;

WHEREAS, the Company has agreed to cede to Zenith, and Zenith has
agreed to assume certain liabilities and obligations of the Company under the
Insurance Contracts (as defined in the Purchase Agreement).

NOW, THEREFORE, in consideration of the mutual covenants and promises
and upon the terms and conditions set forth herein, the parties hereto agree as
follows:

ARTICLE I

DEFINITIONS

Section 1.1. DEFINITIONS. Capitalized terms used herein and not
otherwise defined in this Agreement shall have the meanings given to them in the
Purchase Agreement. As used in this Agreement, the following terms shall have
the following meanings:

"CLAIMANT" means any claimant under any Insurance Contract who (a) has
an open claim on the Effective Date, or (b) files a claim after the Effective
Date.

"EFFECTIVE DATE" means the date specified in the first paragraph
hereof.

"INSURANCE CONTRACTS" shall mean those Insurance Contracts (as defined
in the Purchase Agreement) issued by the Company.

"INSURANCE LIABILITIES" shall mean those Insurance Liabilities (as
defined in the Purchase Agreement) arising under or in connection with the
Insurance Contracts.

"NOVATED POLICIES" means those Insurance Contracts for which: (a) the
Company or Zenith has received a written acceptance by the Policyholder of the
transfer and assumption under this Agreement; or (b) with respect to any
Insurance Contract that was issued or issued for delivery in a state where
written acceptance by the Policyholder is not required by law or the appropriate
regulatory authority to effect an assumption and novation, (i) the Policyholder
is deemed to have accepted the transfer and assumption under this Agreement by
paying premiums directly to Zenith or taking such other action as may be
recognized under applicable state law as evidence of the Policyholder's
acceptance of the transfer and assumption, or (ii) the Policyholder has,
following the mailing to the Policyholder of such notices as may be prescribed
by applicable state law, neither accepted nor rejected the transfer and
assumption within a timeframe under which applicable state law or appropriate
regulatory authority permits the policyholder to be deemed to have accepted the
transfer and assumption. Any claim made by any Claimant under an Insurance
Contract which expired prior to the Effective Date shall, subject to the last
sentence of this paragraph, be deemed to be a claim under a Novated Policy. If
an Insurance Contract defined herein as a Novated Policy is determined by law or
an appropriate regulatory authority, by judicial decision or otherwise to be not
novated, such Insurance Contract shall for all purposes of this Agreement be
deemed retroactive to the Effective Date to be a Quota Share Policy.

"POLICYHOLDER" means each holder of an Insurance Contract that is in
force on the Effective Date.

"PURCHASE AGREEMENT" means the Asset Purchase Agreement, dated as of
June 17, 1997, as amended, among Zenith, the Company, RISCORP Insurance Company,
RISCORP Property Casualty Insurance Company, RISCORP, Inc., RISCORP of Florida,
Inc., RISCORP Management Services, Inc., RISCORP Managed Care Services, Inc.,
RISCORP Insurance Services, Inc., CompSource, Inc., RISCORP of Illinois, Inc.,
Independent Association Administrators Incorporated, RISCORP Real Estate
Holdings, Inc., RISCORP Acquisition, Inc., RISCORP West, Inc., RISCORP Services,
Inc., RISCORP Staffing Solutions Holdings, Inc., RISCORP Staffing Solutions,
Inc. I and RISCORP Staffing Solutions, Inc. II.

"QUOTA SHARE POLICIES" shall have the meaning set forth in Section 2.3
hereof.

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ARTICLE II

BUSINESS REINSURED

Section 2.1. BUSINESS REINSURED. Subject to all of the terms and
conditions contained herein, the Company hereby cedes to Zenith, and Zenith
hereby assumes as reinsurance from the Company, all of the rights and
obligations of the Company under each of the Insurance Contracts.

Section 2.2. NOVATED POLICIES. Zenith shall be the successor to the
Company under the Novated Policies that it assumes as if the Novated Policies
were direct obligations originally issued by Zenith. Zenith shall be
substituted in the place and stead of the Company so as to effect a novation of
the respective Insurance Contracts and release the Company from any and all
rights and obligations thereunder. Each insured under a Novated Policy shall
disregard the Company as a party thereto and treat Zenith as if it had been
originally obligated thereunder except as otherwise provided herein. The
insureds shall file claims arising under the Novated Policies on or after the
effective date of such novation directly with Zenith. The insureds under the
Novated Policies shall also have a right to assert claims related to such
Novated Policies directly against Zenith and Zenith hereby consents to be
subject to such claims by any insured under the Novated Policy; PROVIDED,
HOWEVER, that the rights of any insured under any Insurance Contract shall be
limited to and consist of those rights set forth in such Insurance Contract
(including any rider or endorsement thereto), and no insured shall have the
right to receive any greater amount under any Insurance Contract than such
insured would have had in the absence of this Agreement (except that in
assessing such right no effect shall be given to any bankruptcy, liquidation,
insolvency, reorganization or moratorium of the Company, or the effect of laws
or legal procedures affecting enforcement of creditors' rights against the
Company generally). Payments made to insureds in discharge of obligations on
Novated Policies to provide direct coverage to insureds will diminish any
obligation in respect to those Novated Policies which Zenith may have to the
estate of the Company if it shall be in receivership, liquidation or
rehabilitation proceedings.

Section 2.3. QUOTA SHARE POLICIES. To the extent Zenith has not for
any reason assumed by novation any Insurance Contracts or Insurance Liabilities,
Zenith shall accept and reinsure, on a quota share basis, 100% of Insurance
Liabilities under such Insurance Contracts (the "Quota Share Policies"), in
accordance with the terms and conditions of this Agreement, and hereby agrees to
pay directly, on behalf of the Company, any claims or losses reinsured under
this Agreement which arise under such Quota Share Policies; PROVIDED, HOWEVER,
that the insureds under such Quota Share Policies shall not have the right to
assert claims related to such Quota Share Policies directly against Zenith. A
payment made to an insured in discharge of bligations of RISCORP to provide
direct coverage to the insured

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will diminish the obligation in respect thereof which Zenith may have to the
estate of the Company if it shall be in receivership, liquidation or
rehabilitation proceedings.

Section 2.4. TERMS; CONDITIONS. All Insurance Liabilities for which
Zenith shall assume liability hereunder, either as Novated Policies or Quota
Share Policies, are subject in all respects to the same written terms,
conditions, waivers, modifications, alterations and cancellations as the
Insurance Contracts. Zenith accepts and assumes the Insurance Liabilities
subject to all defenses, setoffs and counterclaims to which the Company would be
entitled with respect to the Insurance Contracts. The parties agree that no
such defenses, setoffs or counterclaims are waived under this Agreement and that
as of the Effective Date, Zenith shall be fully subrogated to all such defenses,
setoffs and counterclaims and be entitled to the full benefits thereof.

ARTICLE III

ASSUMPTION CERTIFICATES

Section 3.1. NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION. (a)
Zenith, with the cooperation and assistance of the Company, shall prepare for
mailing to every Policyholder a Notice of Transfer and Certificate of
Assumption, including a form for rejection or acceptance and a self-addressed
return envelope, substantially in the form attached hereto as EXHIBIT A
(collectively, the "Policyholder Notices"), subject to changes required by state
law or required by any state insurance regulator as a condition for approval of
the mailing of such Policyholder Notices to Policyholders. The Company shall
cooperate and assist Zenith in the preparation and mailing of the Policyholder
Notices as provided herein. Zenith shall mail Policyholder Notices by certified
mail, return receipt requested, to the Policyholders located in a particular
state within thirty days of receipt of all regulatory approvals necessary for
such mailing.

(b) Zenith, with the cooperation and assistance of the Company, shall
prepare for mailing and mail, within thirty days of receipt of all regulatory
approvals necessary for such mailing, to each holder of an Insurance Contract
which expired without renewal during the two year period immediately prececeding
the Effective Date a Notice of Transfer and Assumption substantially in the form
attached hereto as EXHIBIT B (collectively, the "Expired Policy Notices"),
subject to changes required by state law or required by any state insurance
regulator as a condition for approval of the mailing of such Expired Policy
Notices to said holders of Insurance Contracts and Claimants.

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of the Effective Date, to each Claimant who has an open claim on the
Effective Date, a Notice substantially in the form attached hereto as EXHIBIT
C (collectively, the "Claimant Notices"), subject to changes required by
state law or required by any state insurance regulator as a condition for
approval of the mailing of such Claimant Notices to said holders of Insurance
Contracts and Claimants. In addition, Zenith, with the cooperation and
assistance of the Company, shall prepare and mail a Claimant Notice to each
Claimant who is not a Policyholder (as defined herein), but who, after the
Effective Date, files a claim under any Insurance Contract.

Section 3.2. EFFECT OF NOTICE. A Policyholder shall be deemed to
have accepted the transfer and assumption under this Agreement(1) upon receipt
by Zenith of the Policyholder's written acceptance of the transfer and
assumption, or (2) with respect to any Insurance Contract issued or issued for
delivery in a state where written acceptance by the Policyholder is not required
by the appropriate regulatory authority to effect an assumption and novation,
upon taking such action, or failing to take any action following the mailing of
the Policyholder Notice, as specified in Schedule 3.2. attached hereto.

ARTICLE IV

POLICY ADMINISTRATION

Section 4.1. POLICY ADMINISTRATION BY ZENITH. The Company grants to
Zenith authority in all matters relating to the administration of the Insurance
Contracts assumed by Zenith to the extent such authority may be granted pursuant
to applicable law and agrees to cooperate fully with Zenith in the transfer of
such administration. Zenith agrees, at its expense, to be responsible for such
administration. In order to assist and to evidence more fully the substitution
of Zenith in the place and stead of the Company, the Company hereby nominates,
constitutes and appoints Zenith as its attorney-in-fact with respect to the
rights, duties, privileges and obligations of the Company in and to the
Insurance Contracts assumed by Zenith, with full power and authority to act in
the name, place and stead of the Company with respect to such Insurance
Contracts including, without limitation, the power without reservation, to
service all such Insurance Contracts, to adjust, to defend, to settle and to pay
all claims, to recover salvage and subrogation for any losses incurred and to
take such other and further actions as may be necessary or desirable to effect
the transactions contemplated by this Agreement. In addition to other
responsibilities set forth in this Agreement, Zenith shall also issue on the
Company's behalf, but wherever possible in the name of Zenith, all Insurance
Contracts assumed by Zenith which the Company is contractually or otherwise
obligated to issue on and after the Effective Date.

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Section 4.2. FORWARDING OF NOTICES AND OTHER COMMUNICATIONS. The
Company agrees that, after the Effective Date, it will forward to Zenith, within
forty-five (45) days of receipt, all notices and other written communications
received by it relating to the Insurance Contracts assumed by Zenith (including,
without limitation, all inquiries or complaints from state insurance regulators,
agents, brokers and insureds and all notices of claims, suits and actions for
which it receives services of process).

ARTICLE V

CONSIDERATION

Section 5.1. INITIAL CONSIDERATION. In consideration of Zenith's
assumption of the Insurance Liabilities hereunder the Company shall transfer to
Zenith the Transferred Assets pursuant to Section 2.01 of the Purchase Agreement
related to the Company's Insurance Liabilities.

Section 5.2. FUTURE PREMIUMS. Zenith is entitled to receive all
premiums and other consideration paid on or after the Effective Date with
respect to the Insurance Contracts. In the event that the Company receives any
premiums or other consideration with respect to an Insurance Contract on or
after the Effective Date, it shall promptly remit such premiums or other
consideration to Zenith, along with pertinent information in its possession
relating to such premiums, including information as to the Insurance Contract
and period to which such premium relates. Zenith shall assume all responsibility
for billing and collection of premiums. The Company shall reasonably cooperate
with Zenith in causing insureds under the Insurance Contracts to pay premiums to
Zenith after the Effective Date.

ARTICLE VI

RESERVES; CREDIT FOR REINSURANCE

Section 6.1. RESERVES; CREDIT FOR REINSURANCE. Zenith shall maintain
all insurance licenses necessary to permit the Company to obtain full financial
statement credit in all applicable jurisdictions for the reinsurance provided to
it by Zenith pursuant to this Agreement, PROVIDED that if Zenith shall fail to
maintain such licenses, it shall provide the Company with collateral security
permitted under applicable law for purposes of obtaining financial statement
credit for the reinsurance provided under this Agreement. Any unearned premium,
loss and loss adjustment expense reserves required by the foregoing in no event
shall be less than the amounts required under the law of any jurisdiction having
regulatory authority with respect to the establishment of reserves relating to
the Insurance Contracts.

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ARTICLE VII

ASSIGNMENT OF CEDED REINSURANCE AGREEMENTS

Section 7.1. ASSIGNMENT. (a) As of the Effective Date, the Company
shall transfer, set over, assign and convey to Zenith all of its right, title
and interest in any amount held by or due from the assuming reinsurers under the
reinsurance agreements listed in SCHEDULE 7.1-A ("Schedule 7.1-A Reinsurance"),
including (i) amounts held by or which may become due from the assuming
reinsurers thereunder for losses or loss adjustment expenses on Insurance
Contracts for which the Reinsurer has assumed liability or for losses paid by
the Company prior to the Effective Date, and (ii) letters of credit, trust funds
and other security mechanisms outstanding for the benefit of the Company
pursuant to the terms of any of the Schedule 7.1-A Reinsurance. The Company
hereby authorizes Zenith, as of the Effective Date, to prepare and submit, on
the Company's behalf and in the Company's name, all statements and reports
required of the Company under the Schedule 7.1-A Reinsurance, and further
authorizes Zenith to take all other actions required of the Company under the
Schedule 7.1-A Reinsurance or otherwise permitted thereunder, and Zenith agrees
to prepare and submit such reports and take all such actions, except that Zenith
shall not undertake to pay on behalf of the Company, and shall not be obligated
hereunder to pay, any amount due to the reinsurers under the Schedule 7.1-A
Reinsurance unless the Company's obligation to pay such amount shall have been
accrued as a liability on the Final Business Balance Sheet.

(b) As of the Effective Date, the Reinsurer shall be substituted for
and succeed to all of the rights and liabilities of the Company, under the
reinsurance agreements listed in SCHEDULE 7.1-B (the "Schedule 7.1-B
Reinsurance" and, together with the Schedule 7.1-A Reinsurance, the "Ceded
Reinsurance") and shall be recognized for all purposes as the "Company"
thereunder in substitution for the Company. The Company shall transfer, set
over, assign and convey to Zenith all of its rights and obligations of any
nature whatsoever under the Schedule 7.1-B Reinsurance, including (i) amounts
held by or which may become due from assuming reinsurers with respect to any
reinsurance ceded by the Company to the reinsurer thereunder, and (ii) letters
of credit, trust funds and other security mechanisms outstanding for the benefit
of the Company pursuant to the terms of any of the Ceded Reinsurance. Zenith
shall accept such conveyance, transfer and assignment of the Company's rights
under the Schedule 7.1-B Reinsurance and assumes all of the Company's
obligations under the Schedule 7.1-B Reinsurance existing on or arising after
the Effective Date. The assignment and assumption of the Schedule 7.1-B
Reinsurance effected by this Section 7.1 shall be effective only if such
assignment (i) is permitted under the terms of such Schedule 7.1-B Reinsurance
or as otherwise consented to by the reinsurer thereunder, and (ii) shall
preserve fully the obligations of the reinsurers thereunder in respect of the
Insurance Contracts. If the Company's rights and obligations

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under any such Schedule 7.1-B Reinsurance are not assigned to and assumed by
Zenith, (i) after the Effective Date, Zenith shall be responsible for the
payment of all premiums and other considerations required to be paid by the
Company in respect of any of the Schedule 7.1-B Reinsurance, (ii) all
reinsurance recoveries attributable to any of the Schedule 7.1-B Reinsurance
are assigned and shall accrue to the benefit of Zenith hereunder by operation
of this Section 7.1 and shall, upon receipt thereof by the Company, be paid
promptly thereby to Zenith upon and in accordance with its direction, and
(iii) such assignment shall be effective at such time as the assignment may
be effected while preserving fully the obligations of the reinsurer under the
respective Schedule 7.1-B Reinsurance.

(c) The Company shall reasonably cooperate with Zenith in causing
reinsurers under the Ceded Reinsurance to pay reinsurance recoveries to Zenith
after the Effective Date.

Section 7.2. CEDED REINSURANCE COLLATERAL. To the extent necessary
to effect any transfer or assignment pursuant to this Section 7.1 of any assumed
reinsurance, the Company hereby appoints Zenith as attorney-in-fact for the
Company to act for and on behalf of it with respect to letters of credit, trust
funds and other security mechanisms outstanding for the benefit of the Company
pursuant to the terms of any of the Ceded Reinsurance, and the Company shall
execute and deliver to Zenith such additional instruments as Zenith may
reasonably request to give effect to such appointment as attorney-in-fact, and
to provide appropriate evidence that the Company has assigned to Zenith all of
its rights under the Ceded Reinsurance with respect to any such letters of
credit, trust funds or other accounting mechanism. Zenith shall use its
reasonable best efforts to the extent deemed reasonably necessary by Zenith, to
cause the reinsurers under the Ceded Reinsurance to provide replacement letters
of credit, trust funds or other security mechanisms, as applicable, naming
Zenith as the beneficiary thereof in amounts and with terms substantially
similar to those currently provided by such reinsurers for the benefit of the
Company.

ARTICLE VIII

INDEMNIFICATION

Section 8.1. SOLE REMEDY. Notwithstanding anything to the contrary
in this Agreement, the Company shall not settle any claim, waive any right,
defense, setoff or counterclaim with respect to, or amend, commute or terminate,
any Insurance Contract or Ceded Reinsurance without the prior written consent of
Zenith, except in accordance with the provisions of the indemnities referred to
in the following sentence. The Company's sole and exclusive remedy with respect
to a breach of this Agreement shall be the indemnities provided by Section 9.02
of the Purchase Agreement, except that any dispute between the

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parties arising hereunder for which such indemnities are being sought shall
be subject to arbitration pursuant to Article XV hereof.

ARTICLE IX

GENERAL PROVISIONS

Section 9.1. INSPECTION. Zenith and the Company, or their
designated representatives, may inspect, at the place where such records are
located, any and all books and records of the other parties hereto reasonably
relating to this Agreement, during normal business hours and upon reasonable
notice. The rights of the parties under this Section 9.1 shall survive
termination of this Agreement.

Section 9.2. MISUNDERSTANDINGS AND OVERSIGHTS. Any delay, omission,
error or failure to pay amounts due or to perform any other act required by this
Agreement that is unintentional and caused by misunderstanding or oversight
shall not be held to relieve either party to this Agreement from any obligation
hereunder if such delay, omission, error or failure is corrected within 20
Business Days of receipt of notice of such delay, omission, error or failure and
neither party shall have been prejudiced.

Section 9.3. ADJUSTMENTS. If the liability of the Company under any
of the Insurance Contracts is changed as a result of a change required by law or
regulation or any other reason, Zenith will share in the change proportionately
(100%) to the amount reinsured hereunder.

Section 9.4. COMMUNICATIONS RELATING TO THE INSURANCE CONTRACTS.
After the Effective Date, the Company and Zenith each shall forward promptly to
the other copies of all notices and other written communications it receives
relating to the Insurance Contracts (including without limitation, all inquiries
and complaints from state insurance regulators, brokers and other service
providers and reinsureds, all policyholder complaints and complaints received
from other claimants under the Insurance Contracts and all notices of claims,
suits and actions for which it receives service of process). As used in this
Section, "complaint" means any written communication primarily expressing a
grievance against the Company or Zenith.

Section 9.5. DUTY OF COOPERATION. The Company and Zenith shall
cooperate fully with the other in all reasonable respects in order to accomplish
the objectives of this Agreement.

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ARTICLE X

ACCOUNTING

Section 10.1. ACCOUNTING REPORTS. On or before the last Business Day
of each month, Zenith will provide the Company with reports of activities under
this Agreement for the preceding month. Such reports shall show any amounts due
the Company or Zenith, as the case may be, as reimbursement for paid claims,
premiums or other amounts due with respect to the Insurance Contracts. The net
balance due either party, as indicated in the monthly report, shall be remitted
to the other party within 15 days of the delivery of said monthly report. The
requirements of this Section 10.1 shall terminate if, for twelve consecutive
months, no amounts are reported as due either party with respect to the
Insurance Contracts; PROVIDED, such requirements shall be reinstated and shall
continue in effect for an additional twelve months if at any time following such
termination, any balance or amount becomes due either party under this
Agreement.

Section 10.2. FINANCIAL STATEMENT INFORMATION. On or before the last
business day of each January, April, July and October, Zenith shall provide the
Company with a quarterly or annual report containing the financial, accounting
and actuarial information necessary to prepare regulatory, tax and GAAP monthly,
quarterly and annual financial statements and returns and satisfy other related
requirements, including reserve and related calculations respecting the
Insurance Contracts in the form reasonably required by the Company, and will
maintain or cause to be maintained the data processing systems that will enable
Zenith to provide such information. The Company shall cooperate with Zenith in
preparing such reports and shall supply such information as Zenith requires to
prepare such statements and returns and satisfy such requirements. The
requirements of this Section shall terminate automatically upon the termination
of the reporting requirements of Section 10.1 and shall be reinstated
automatically upon the reinstatement of such reporting requirements.

Section 10.3. REPORTS TO INSURANCE DEPARTMENTS. Zenith and the
Company will promptly furnish to the other, copies of any and all filings with,
and reports or communications received from, any regulatory authority which
relate directly and materially to the Insurance Contracts, including, without
limitation, each annual statement, each quarterly financial report to the
insurance department of the party's domicile and each report on periodic
examination issued by the insurance department of the party's domicile to the
extent it relates to the Insurance Contracts. The requirements of this Section
shall terminate automatically upon the termination of the reporting requirements
of Section 10.1 and shall be reinstated automatically upon the reinstatement of
such reporting requirements.

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ARTICLE XI

TERMINATION

Section 11.1. TERMINATION. Except as mutually agreed by the Company
and Zenith, this Agreement shall be unlimited in duration.

ARTICLE XII

INSOLVENCY

Section 12.1. PAYMENTS BY ZENITH. Zenith hereby agrees that all
amounts due under this Agreement with respect to all Quota Share Policies shall
be payable by Zenith on the basis of the liability of the Company under such
contracts, without diminution because of the insolvency, liquidation or
rehabilitation of the Company Insurance Subsidiary. Zenith shall make payments
due hereunder with respect to Quota Share Policies directly to the Company or to
its conservator, receiver, liquidator or other statutory successor.

Section 12.2. CLAIMS. It is agreed that any conservator, receiver,
liquidator or statutory successor of the Company shall give prompt written
notice to Zenith of the pendency or submission of a claim under any Insurance
Contract. With respect to any Insurance Contract, during the pendency of such
claim, Zenith may investigate such claim and interpose, at its own expense, in
the proceeding where such claim is to be adjudicated, any defense available to
the Company or its conservator, receiver, liquidator or statutory successor.
The expense thus incurred by Zenith is chargeable against the Company as a part
of the expense of insolvency, liquidation or rehabilitation to the extent of a
proportionate share of the benefit which accrues to the Company solely as a
result of the defense undertaken by Zenith. Where Zenith and other assuming
companies are involved in the same claim and a majority in interest elect to
interpose a defense to such claim, the expense shall be apportioned in
accordance with the terms of the insurance agreement as though such expense had
been incurred by the Company.

ARTICLE XIII

OFFSET

Section 13.1. OFFSET. Notwithstanding any provisions of this
Agreement to the contrary, any balances or amounts due from one party to the
other under this Agreement are deemed mutual debts or credits, as the case may
be, and shall be set off, and only the balance shall be allowed or paid.

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ARTICLE XIV

RIGHTS WITH RESPECT TO QUOTA SHARE POLICIES

Section 14.1. SOLE BENEFICIARY. Zenith's quota share reinsurance
of 100% of the Insurance Liabilities of the Company with respect to any of
the Quota Share Policies is intended for the sole benefit of the parties to
this Agreement and shall not create any right on the part of any
Policyholder, insured, claimant or beneficiary under such Quota Share
Policies against Zenith or any legal relation between such Policyholders,
insureds, claimants or beneficiaries and Zenith.

ARTICLE XV

ARBITRATION

Section 15.1. APPOINTMENT OF ARBITRATORS. Any dispute or
difference arising under this Agreement that cannot be resolved by agreement
among the parties hereto shall be decided by arbitration in accordance with
this Article XV. Any such arbitration shall be conducted expeditiously and
confidentially in accordance with the Commercial Arbitration Rules of the
American Arbitration Association ("AAA") as such rules shall be in effect on
the date of delivery of demand for arbitration. Any such arbitration shall
be heard and conducted in New York, New York. Notwithstanding the rules of
the AAA, the arbitration panel in any such arbitration shall consist of three
persons who must be disinterested current or retired officers of insurance or
reinsurance companies other than the parties to this Agreement or their
Affiliates. Within twenty days of delivery of any demand for arbitration
hereunder, the Company and Zenith shall each appoint one arbitrator, and the
two arbitrators so selected shall appoint the third arbitrator within twenty
days of their appointment. In the event the two selected arbitrators are
unable to agree upon the selection of a third arbitrator after reasonable
efforts, a panel of seven qualified persons shall be requested from the AAA.
The parties shall alternately strike one person with the last remaining
person being the third designated arbitrator; the party responding to the
initial demand for arbitration shall have the first turn. Each party shall
pay the fees of its own attorneys, expenses of witnesses and all other
expenses connected with the presentation of such party's case. One-half of
any remaining costs of any arbitration, including the cost of the record or
transcripts thereof, if any, administrative fees and all other fees involved
shall be paid by Zenith, and the remaining one-half shall be paid by the
Company.

Section 15.2. DECISION. The arbitrators shall render a decision
within 60 days of the end of the arbitration hearing. The arbitrators shall
consider customary and standard practices in the insurance business. They
shall decide by a majority vote of the arbitrators. All conclusions of law
reached by the

-12-

arbitrators shall be made in accordance with the internal substantive laws of
the State of New York without regard to conflict of laws principles. Any
award rendered by the arbitrators shall be accompanied by a written opinion
setting forth the findings of fact and conclusions of law relied upon in
reaching their decision. There shall be no appeal from their written
decision. Judgment may be entered on the decision of the arbitrators by any
court having jurisdiction.

Section 15.3. CONFIDENTIALITY. Zenith and the Company agree that
the existence, conduct and content of any arbitration shall be kept
confidential and no party shall disclose to any person any information about
such arbitration, except as may be required by law or for financial reporting
purposes in each party's financial statements.

Section 15.4. SURVIVAL OF ARTICLE. This Article XV shall survive
termination of this Agreement.

Section 15.5. OTHER ACTIONS. Submission of a matter to
arbitration shall be a condition precedent to any right to institute a
proceeding at law or in equity concerning such matter, except for injunctive
or other provisional relief pending the arbitration of a matter subject to
arbitration pursuant to this Agreement. Subject to the foregoing, each party
hereto consents to the non exclusive jurisdiction of the United States
District Court for the Southern District of New York (the "Chosen Court") in
respect of any claim arising out of, related to or contemplated by this
Agreement, (i) waives any objection to laying venue in any such action or
proceeding in the Chosen Court, (ii) waives any objection that at the Chosen
Court is an inconvenient forum or does not have jurisdiction over any party
hereto and (iii) agrees that service of process upon such party in any such
action or proceeding shall be effective if notice is given in accordance with
Section 16.02 of this Agreement.

ARTICLE XVI

TERRITORY

Section 16.1. TERRITORY. This Agreement shall apply to all
Insurance Contracts issued by the Company without territorial limitation.

-13-

ARTICLE XVII

TAXES

Section 17.1. TAXES. Zenith shall be responsible for and shall
pay all premium taxes which shall accrue on or after the Effective Date with
respect to the Insurance Contracts; the Company shall remain responsible for
the payment of, and Zenith shall have no obligation to pay, any premium taxes
which shall accrue prior to the Effective Date which have not otherwise been
accrued on the Final Business Balance Sheet.

ARTICLE XVIII

MISCELLANEOUS PROVISIONS

Section 18.1. HEADINGS. Headings used herein are not a part of
this Agreement and shall not affect the terms hereof.

Section 18.2. NOTICES. All notices and communications hereunder
shall be in writing and shall be deemed given if delivered personally or sent
by overnight delivery service (providing for proof of delivery). All notices
or communications with Zenith under this Agreement shall be directed to:

Zenith Insurance Company
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇

with copies to:

LeBoeuf, Lamb, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇, Esq.

All notices and communications with the Company under this Agreement shall be
directed to:

RISCORP, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.

-14-

with copies to:

Polsinelli, White, Bardman & Shalton, P.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.

▇▇▇▇▇▇ & Bird
One Atlantic Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.

Section 18.3. SEVERABILITY. If any term or provision of this
Agreement shall be held void, illegal or unenforceable, the validity of the
remaining portions or provisions shall not be affected thereby.

Section 18.4. SUCCESSORS AND ASSIGNS. This Agreement may not be
assigned by either party without the prior written consent of the other. The
provisions of this Agreement shall be binding upon and inure to the benefit
of and be enforceable by the parties hereto and their respective successors
and assigns as permitted herein.

Section 18.5. NO THIRD PARTY BENEFICIARIES. Except as otherwise
specifically provided for in Article X of this Agreement, nothing in this
Agreement is intended or shall be construed to give any person, other than
the parties hereto, their successors and permitted assigns, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein, and Zenith shall not be directly liable hereunder
to any reinsured under any Insurance Contract.

Section 18.6. INTERPRETATION. For purposes of this Agreement,
the words "hereof," "herein," "hereby" and other words of similar import
refer to this Agreement as a whole unless otherwise indicated. Whenever the
words "include", "includes", or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation". Whenever
the singular is used herein, the same shall include the plural, and whenever
the plural is used herein, the same shall include the singular, where
appropriate.

Section 18.7. EXECUTION IN COUNTERPARTS. This Agreement may be
executed by the parties hereto in any number of counterparts and by each of
the parties hereto in separate counterparts, each of which counterparts, when
so executed and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.

Section 18.8. AMENDMENTS; ENTIRE AGREEMENT. This Agreement may be
amended only by written agreement of the parties. This Agreement, together
with the Purchase Agreement

-15-

and the Ancillary Agreements, supersedes all prior discussions and written
and oral agreements and constitutes the sole and entire agreement between the
parties with respect to the subject matter hereof.

-16-

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their duly authorized representatives as of the date first
above written.

ZENITH INSURANCE COMPANY

By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Senior Vice President

RISCORP NATIONAL INSURANCE COMPANY

By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President

-17-

SCHEDULE 3.2

STATE REQUIREMENTS FOR TRANSFER
AND NOVATION OF INSURANCE CONTRACTS

ALABAMA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

ARKANSAS Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

FLORIDA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

GEORGIA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

ILLINOIS Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the

Policyholder will be deemed to have accepted if no response
is received within 30 days.

INDIANA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

IOWA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

KANSAS Affirmative written consent of the Policyholder.

LOUISIANA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

MINNESOTA Affirmative written consent of the Policyholder.

MISSISSIPPI Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

MISSOURI Affirmative consent of Policyholder OR payment of premiums
without objection OR failure by Policyholder to object after
receipt of 3 letters, the first requesting affirmative
consent; the second, to be sent twelve months after the
first, requesting

-2-

affirmative consent; the third, to be sent twelve months
after the second, stating that the Policyholder will be
deemed to have accepted if no response is received within
six months.

NEBRASKA Affirmative consent of Policyholder or failure by
Policyholder to object after receipt of 2 letters, the first
requesting affirmative consent; the second, to be sent
twelve months after the first, stating that the Policyholder
will be deemed to have accepted if no response is received
within two months.

NORTH CAROLINA Affirmative consent of Policyholder or failure by
Policyholder to object after receipt of 2 letters, the first
requesting affirmative consent; the second, to be sent
twenty-four months after the first, stating that the
Policyholder will be deemed to have accepted if no response
is received within one month.

OKLAHOMA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

SOUTH CAROLINA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

TENNESSEE Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

-3-

TEXAS Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

VIRGINIA Affirmative consent of Policyholder or failure by the
Policyholder to object after receipt of 3 letters, the first
requesting affirmative consent; the second, to be sent 30
days after the first, requesting affirmative consent; the
third, to be sent 30 days after the second, stating that the
Policyholder will be deemed to have accepted if no response
is received within 30 days.

WISCONSIN Affirmative written consent of the Policyholder.

-4-

SCHEDULE 7.1-A REINSURANCE AGREEMENTS

1. Workers' Compensation Quota Share Reinsurance Agreement between RISCORP
Insurance Company, RISCORP Property and Casualty Insurance Company and
American Re-Insurance Company effective January 1, 1995 including
Endorsement Nos. E001 through E004 and Indemnity Agreements dated February
7, 1995.

2. RISCORP National Insurance Company Workers Compensation Quota Share
Agreement by and between RISCORP National Insurance Company and Chartwell
Reinsurance Company (50%), Swiss Reinsurance America Corp. (25%), and
Trenwick America Reinsurance Corp. (25%) effective October 1, 1996.

3. Workers Compensation Excess of Loss Reinsurance Agreement between RISCORP
Property and Casualty Insurance Company, RISCORP Insurance Company, and
RISCORP National Insurance Company and Continental Casualty Company
effective January 1, 1997.

4. Workers Compensation and Employers Liability Excess of Loss Reinsurance
Agreement between RISCORP Property & Casualty Insurance Company, RISCORP
Insurance Company and RISCORP National Insurance Company and Continental
PTO Casualty Company, effective January 1, 1997.

SCHEDULE 7.1-B REINSURANCE AGREEMENTS

1. Medical Excess of Loss Reinsurance Agreement between RISCORP Property &
Casualty Insurance Company and The Cologne Life Reinsurance Company
effective September 1, 1995.

2. Property Quota Share Agreement between RISCORP Property & Casualty
Insurance Company and Scor Reinsurance Company, Signet Star Reinsurance
Company, Hartford Fire Insurance Company, Chartwell Reinsurance Company and
Great Lakes American Reinsurance Company effective January 1, 1996.

3. Casualty Excess of Loss Agreement between RISCORP Property & Casualty
Insurance Company and Scor Reinsurance Company, Signet Star Reinsurance
Company, Hartford Fire Insurance Company, and Chartwell Reinsurance Company
effective January 1, 1996.

4. Commercial Umbrella Quota Share Treaty between RISCORP Property & Casualty
Insurance Company and Scor Reinsurance Company, Signet Star Reinsurance
Company, Hartford Fire Insurance Company, and Chartwell Reinsurance Company
effective January 1, 1996.

5. Workers Compensation Quota Share Retrocessional Treaty Agreement between
Chartwell Reinsurance Company and RISCORP Insurance Company effective
September 1, 1995.

MISSOURI EXHIBIT A

RISCORP NATIONAL INSURANCE COMPANY ZENITH INSURANCE COMPANY
ONE SARASOTA TOWER ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇

NOTICE OF TRANSFER

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT
CAREFULLY.

TRANSFER OF POLICY

Zenith Insurance Company has agreed to replace RISCORP National
Insurance Company as your insurer under [insert policy/certificate name
and number]effective [insert date]. Zenith Insurance Company's principal
place of business is ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇-▇▇▇▇; however, all correspondence with Zenith Insurance Company
concerning your policy should be sent to ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇. Certain financial information concerning both companies is attached,
including: (1) ratings for the last five years if available or for such
lesser period as is available from two nationally recognized insurance rating
services; (2) balance sheets for the previous three years if available or for
such lesser period as is available and as of a date no later than ninety days
prior to the current date; (3) a copy of the management's discussion and
analysis that was filed as a supplement to the previous year's annual
statement; and (4) an explanation of the reason for the transfer. You may
obtain additional information concerning Zenith Insurance Company from
reference materials in your local library or by contacting your Insurance
Commissioner at [insert address and phone number]. Zenith Insurance Company
is licensed in your state.

YOUR RIGHTS

You may choose to consent to or reject the transfer of your policy to
Zenith Insurance Company. If you want your policy transferred, you may notify
us in writing by signing and returning the enclosed pre-addressed, postage-paid
card or by writing to us at:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN [THIRTY MONTHS] OF THIS
NOTICE OF TRANSFER, YOU WILL, AS A MATTER OF LAW, HAVE CONSENTED TO THE
TRANSFER. HOWEVER, BEFORE THIS CONSENT IS FINAL, YOU WILL BE SENT A SECOND
NOTICE, TWELVE MONTHS AFTER OUR FIRST NOTICE, AND A THIRD AND FINAL NOTICE
TWENTY-FOUR MONTHS AFTER OUR FIRST NOTICE. AFTER THE THIRD AND FINAL NOTICE
IS PROVIDED, YOU WILL HAVE ONLY SIX MONTHS TO REPLY.

If you reject the transfer, you may keep your policy with RISCORP
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, Zenith Insurance Company will be your
insurer. It will have direct responsibility to you for the payment of all
claims, benefits and for all other policy obligations. RISCORP National
Insurance Company will no longer have any obligations to you.

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

---------------------------------- -------------------------------
RISCORP NATIONAL INSURANCE COMPANY ZENITH INSURANCE COMPANY
One Sarasota Tower ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇

SECOND NOTICE
NOTICE OF TRANSFER

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT
CAREFULLY.

TRANSFER OF POLICY

You were previously sent a Notice of Transfer notifying you that Zenith
Insurance Company has agreed to replace RISCORP National Insurance Company as
your insurer under [insert policy/certificate name and number] effective
[insert date]. Zenith Insurance Company's principal place of business is
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇; however, all
correspondence with Zenith Insurance Company concerning your policy should be
sent to ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. Certain financial
information concerning both companies was attached to the First Notice of
Transfer previously sent to you, including: (1) ratings for the last five
years if available or for such lesser period as is available from two
nationally recognized insurance rating services; (2) balance sheets for the
previous three years if available or for such lesser period as is available
and as of a date no later than ninety days prior to the current date; (3) a
copy of the management's discussion and analysis that was filed as a
supplement to the previous year's annual statement; and (4) an explanation of
the reason for the transfer. If you would like additional copies of this
information, please contact Zenith Insurance Company at the addresses
supplied above. You may obtain additional information concerning Zenith
Insurance Company from reference materials in your local library or by
contacting your Insurance Commissioner at [insert address and phone number].
Zenith Insurance Company is licensed in your state.

YOUR RIGHTS

We are sending you a second notice because we did not receive the
pre-addressed response card or other written notice from you indicating your
rejection of the proposed transfer. If you want your policy transferred to
Zenith Insurance Company, you may notify us in writing by signing and
returning the enclosed pre-addressed, postage-paid card or by writing to us
at:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN TWELVE MONTHS, YOU WILL BE
SENT A THIRD AND FINAL NOTICE. IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION
WITHIN SIX MONTHS AFTER THE DATE OF THE THIRD NOTICE, YOU WILL BE DEEMED TO
HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP
National Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

---------------------------------- --------------------------------
RISCORP NATIONAL INSURANCE COMPANY ZENITH INSURANCE COMPANY
One Sarasota Tower ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇

THIRD AND FINAL NOTICE
NOTICE OF TRANSFER

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT
CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

We are sending you a third notice because we did not receive the
pre-addressed response card or other written notice from you indicating your
rejection of the proposed transfer. If you want your policy transferred to
Zenith Insurance Company, you may notify us in writing by signing and
returning the enclosed pre-addressed, postage-paid card or by writing to us
at:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN SIX MONTHS OF THE DATE OF
THIS THIRD AND FINAL NOTICE, YOU WILL BE DEEMED TO HAVE ACCEPTED THE
TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP
National Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

RESPONSE CARD

--------- YES, I accept the transfer of my policy
from RISCORP National Insurance Company to
Zenith Insurance Company.

--------- NO, I reject the proposed transfer of
my policy from RISCORP National Insurance Company
to Zenith Insurance Company and wish
to retain my policy with RISCORP National
Insurance Company.

------------------ -------------------------------------
DATE SIGNATURE

NAME:
---------------------------------------------------------------------

STREET ADDRESS:
-----------------------------------------------------------

CITY, STATE, ZIP:
---------------------------------------------------------

RISCORP NATIONAL INSURANCE COMPANY
INSURANCE RATINGS

YEAR A.M. BEST STANDARD & POORS

1997 NR-2 not rated*
1996 B+
1995 B+
1994 B+
1993 B

* Standard & Poors' ratings are not available for this company.

ZENITH INSURANCE COMPANY
INSURANCE RATINGS

YEAR A.M. BEST STANDARD & POORS

1997 A+** AA-***
1996 A+ AA-
1995 A+ AA-
1994 A+ AA-
1993 A+ AA-

** The A.M. Best rating for all five years is for the Zenith National
Insurance Group, and applies to all four intercompany pool members,
including Zenith Insurance Company.

*** Zenith Insurance Company was previously rated by Standard and Poors as
part of an intercompany pool of members. Beginning in 1997, Standard &
Poors began rating the individual pool members separately.

A.M. BEST COMPANY DEFINITIONS:

A+ Company has superior overall financial strength and operating performance
and has a very strong ability to meet its ongoing obligations to
policyholders.

B+ Company has very good financial strength and operating performance and has
a good ability to meet its ongoing obligations to policyholders.

B Company has fair financial strength and operating performance and has an
ability to meet current obligations to policyholders, but its financial
strength is vulnerable to adverse changes in underwriting and economic
conditions.

NR-2 Company is not rated due to insufficient size (in terms of capital and
surplus) and/or operating experience.

STANDARD & POOR'S DEFINITIONS:

AA- Company has excellent financial security and has a strong capacity to meet
policyholder obligations under a variety of economic and underwriting
conditions.

REASONS FOR THE TRANSFER OF YOUR POLICY

The transfer of your policy is being made pursuant to an Assumption
and Indemnity Reinsurance Agreement between Zenith Insurance Company and
Riscorp National Insurance Company, dated as of [effective date], whereby
Zenith Insurance Company agreed to assume Riscorp National Insurance
Company's obligations under certain insurance policies, including your policy.

AL, AR, IL, IN, IA, LA, MS, OK, SC, TN, TX, VA EXHIBIT A

NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY DAYS, YOU WILL BE SENT
A SECOND NOTICE. IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY(30)
DAYS AFTER THE DATE OF THE SECOND NOTICE, YOU WILL BE SENT A THIRD NOTICE. IF
WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY (30) DAYS AFTER THE DATE
OF THE THIRD NOTICE, YOU WILL BE DEEMED TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP National
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

___________________ _____________________

RISCORP NATIONAL INSURANCE COMPANY ZENITH INSURANCE COMPANY
One Sarasota Tower ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇

-2-

SECOND NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY DAYS, YOU WILL BE SENT
A THIRD NOTICE. IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY (30)
DAYS AFTER THE DATE OF THE THIRD NOTICE, YOU WILL BE DEEMED TO HAVE ACCEPTED THE
TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP National
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

-3-

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

___________________ _____________________

-4-

THIRD AND FINAL NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY DAYS OF THE DATE OF
THIS THIRD AND FINAL NOTICE, YOU WILL BE DEEMED TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP National
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

-5-

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

Sincerely,

___________________ _____________________

-6-

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

RESPONSE CARD

_________ YES, I accept the transfer of my policy
from RISCORP National Insurance Company to
Zenith Insurance Company.

_________ NO, I reject the proposed transfer of
my policy from RISCORP National Insurance Company
to Zenith Insurance Company and wish
to retain my policy with RISCORP National
Insurance Company.

_____________ ______________________________
DATE SIGNATURE

NAME:
_______________________________________________________________________

STREET ADDRESS:
_______________________________________________________________________

CITY, STATE, ZIP:
_______________________________________________________________________

-7-

GEORGIA EXHIBIT A

RISCORP NATIONAL INSURANCE COMPANY ZENITH INSURANCE COMPANY
ONE SARASOTA TOWER ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇

NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

Zenith Insurance Company is licensed in the following states: Alabama,
Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District of
Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas,
Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota,
Mississippi, Missouri, Nebraska, New Jersey, New Mexico, New York, North
Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South
Dakota, Tennessee, Texas, Utah, Vermont, Virginia and Wisconsin.

If Zenith Insurance Company is not licensed in the state where you reside,
this transfer may affect your guarantee fund protection or your Insurance
Commissioner's ability to assist you with any matters concerning the company.

YOUR RIGHTS

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

You may obtain additional information concerning Zenith from reference
materials in your local library or by contacting ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Insurance and
Safety Fire Commissioner, Regulatory Services Division, Georgia Department of
Insurance, Suite 604, West Tower, ▇▇▇▇▇ Building, ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ (tel. (▇▇▇) ▇▇▇-▇▇▇▇).

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY, YOU WILL BE SENT A
SECOND NOTICE. IF WE DO NOT RECEIVE YOUR WRITEN REJECTION WITHIN THIRTY DAYS
AFTER THE DATE OF THE SECOND NOTICE YOU WILL BE SENT A THIRD NOTICE. IF WE DO
NOT RECEIVE YOUR

WRITTEN REJECTION WITHIN THIRTY DAYS AFTER THE DATE OF THE THIRD NOTICE, YOU
WILL BE DEEMED TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

___________________ _____________________

RISCORP NATIONAL INSURANCE COMPANY ZENITH INSURANCE COMPANY
One Sarasota Tower ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇

SECOND NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY DAYS, YOU WILL BE SENT
A THIRD AND FINAL NOTICE. IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN
THIRTY DAYS OF THE THIRD NOTICE, YOU WILL BE DEEMED TO HAVE ACCEPTED THE
TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP National
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

Sincerely,

___________________ _____________________

THIRD AND FINAL NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

Zenith Insurance Company is licensed in the following states: Alabama,
Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District
of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa,
Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan,
Minnesota, Mississippi, Missouri, Nebraska, New Jersey, New Mexico, New York,
North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina,
South Dakota, Tennessee, Texas, Utah, Vermont, Virginia and Wisconsin.

If Zenith Insurance Company is not licensed in the state where you
reside, this transfer may affect your guarantee fund protection or your
Insurance Commissioner's ability to assist you with any matters concerning
the company.

YOUR RIGHTS

We are sending you a third and final notice because we did not receive
the pre-addressed response card or other written notice from you indicating
your rejection of the proposed transfer. If you want your policy transferred
to Zenith Insurance Company, you may notify us in writing by signing and
returning the enclosed pre-addressed, postage-paid card or by writing to us
at:

You may obtain additional information concerning Zenith from reference
materials in your local library or by contacting ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Insurance
and Safety Fire Commissioner, Regulatory Services Division, Georgia
Department of Insurance, Suite 604, West Tower, ▇▇▇▇▇ Building, ▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ (tel. (▇▇▇) ▇▇▇-▇▇▇▇).

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY DAYS, YOU WILL BE
DEEMED TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP
National Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

Sincerely,

__________________________________ ________________________

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

RESPONSE CARD

_________ YES, I accept the transfer of my policy
from RISCORP National Insurance Company to
Zenith Insurance Company.

_________ NO, I reject the proposed transfer of
my policy from RISCORP National Insurance Company
to Zenith Insurance Company and wish
to retain my policy with RISCORP National
Insurance Company.

____________ ____________________________
DATE SIGNATURE

NAME:_________________________________________________________________________

STREET ADDRESS:_______________________________________________________________

CITY, STATE, ZIP:_____________________________________________________________

KS, MN, WI EXHIBIT A

NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

You may choose to consent to or reject the transfer of your policy to
Zenith Insurance Company. THIS CHANGE IN INSURANCE COMPANIES IS CONTINGENT
UPON YOUR EXPRESS AFFIRMATIVE CONSENT, GIVEN BY SENDING THE ATTACHED FORM TO
RISCORP AT THE ADDRESS BELOW:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

If you do not want your policy transferred, you may notify us in writing
by signing and returning the enclosed pre-addressed, postage-paid card or by
writing to us at the above address.

If you reject the transfer, you may keep your policy with RISCORP
National Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you consent to this transfer, ONLY Zenith Insurance Company shall
have obligations or be liable to you in the future and RISCORP National
Insurance Company shall be released from all future obligations or liability.
If you consent to this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

If you do NOT consent to this tranfer, ONLY RISCORP National Insurance
Company shall have obligations or be liable to you in the future and you
shall have no rights against Zenith Insurance Company. It will have direct
responsibility to you for the payment of all claims, benefits and for all
other policy obligations. RISCORP National Insurance Company will no longer
have any obligations to you.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

__________________________________ ________________________

-2-

SECOND NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

We are sending you a second notice because we did not receive the
pre-addressed response card or other written notice from you indicating your
rejection of the proposed transfer. You may choose to consent to or reject
the transfer of your policy to Zenith Insurance Company. THIS CHANGE IN
INSURANCE COMPANIES IS CONTINGENT UPON YOUR EXPRESS AFFIRMATIVE CONSENT,
GIVEN BY SENDING THE ATTACHED FORM TO RISCORP AT THE ADDRESS BELOW:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

If you do not want your policy transferred, you may notify us in writing
by signing and returning the enclosed pre-addressed, postage-paid card or by
writing to us at the above address.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN THIRTY DAYS, YOU WILL BE
SENT A THIRD NOTICE.

If you reject the transfer, you may keep your policy with RISCORP
National Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you do NOT consent to this tranfer, ONLY RISCORP National Insurance
Company shall have obligations or be liable to you in the future and you
shall have no rights against Zenith Insurance Company.

-3-

It will have direct responsibility to you for the payment of all claims,
benefits and for all other policy obligations. RISCORP National Insurance
Company will no longer have any obligations to you.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

__________________________________ ________________________

-4-

THIRD AND FINAL NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

YOUR RIGHTS

We are sending you a third notice because we did not receive the
pre-addressed response card or other written notice from you indicating your
rejection of the proposed transfer. You may choose to consent to or reject
the transfer of your policy to Zenith Insurance Company. THIS CHANGE IN
INSURANCE COMPANIES IS CONTINGENT UPON YOUR EXPRESS AFFIRMATIVE CONSENT,
GIVEN BY SENDING THE ATTACHED FORM TO RISCORP AT THE ADDRESS BELOW:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

If you do not want your policy transferred, you may notify us in writing
by signing and returning the enclosed pre-addressed, postage-paid card or by
writing to us at the above address.

THIS IS YOU THIRD AND FINAL NOTICE OF TRANSFER. IF WE DO NOT RECEIVE
YOUR WRITTEN CONSENT, GIVEN BY SENDING THE ATTACHED FORM TO RISCORP AT THE
ADDRESS ABOVE, YOUR POLICY WILL REMAIN WITH RISCORP NATIONAL INSURANCE
COMPANY AND YOU SHALL HAVE NO RIGHTS AGAINST ZENITH INSURANCE COMPANY.

EFFECT OF TRANSFER

-5-

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

__________________________________ ________________________

-6-

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

RESPONSE CARD

_________ YES, I accept the transfer of my policy
from RISCORP National Insurance Company to
Zenith Insurance Company.

_________ NO, I reject the proposed transfer of
my policy from RISCORP National Insurance Company
to Zenith Insurance Company and wish
to retain my policy with RISCORP National
Insurance Company.

_____________ ______________________________
DATE SIGNATURE

NAME:
_______________________________________________________________________

STREET ADDRESS:
_______________________________________________________________________

CITY, STATE, ZIP:
_______________________________________________________________________

-7-

NEBRASKA EXHIBIT A

NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

Zenith Insurance Company has agreed to replace RISCORP National
Insurance Company as your insurer under [insert policy/certificate name
and number]effective [insert date]. Zenith Insurance Company's principal
place of business is ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇-▇▇▇▇; however all correspondence with Zenith Insurance Company concerning
your policy should be sent to ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
Certain financial information concerning both companies is attached, including:
(1) ratings for the last five years if available or for such lesser period as
is available from two nationally recognized insurance rating services;
(2) balance sheets for the previous three years if available or for such
lesser period as is available and as of a date no later than ninety days prior
to the current date; and (3) an explanation of the reason for the transfer.
If you request it, a copy of the Management's Discussion and Analysis which was
filed as a supplement to the previous year's annual statement will be sent to
you at no additional expense to you. You may obtain additional information
concerning Zenith Insurance Company from reference materials in your local
library or by contacting your Insurance Commissioner at [insert address and
phone number]. Zenith Insurance Company is licensed in your state.

YOUR RIGHTS

You may choose to consent to or reject the transfer of your policy to
Zenith Insurance Company. If you want your policy transferred, you may
notify us in writing by signing and returning the enclosed pre-addressed,
postage-paid card or by writing to us at:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING NO
LATER THAN [24 MONTHS] AFTER THE DATE THIS NOTICE BY SIGNING AND RETURNING THE
ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY WRITING TO US AT THE ABOVE
ADDRESS. IF WE DO NOT RECEIVE A WRITTEN REJECTION YOU, AS A MATTER OF LAW,
WILL HAVE CONSENTED TO THE TRANSFER. HOWEVER, BEFORE THIS CONSENT IS FINAL, YOU
WILL BE PROVIDED A FINAL NOTICE OF THE TRANSFER [TWELVE MONTHS] FROM NOW. IF WE
DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN TWO MONTHS AFTER THE DATE OF THE
FINAL NOTICE, YOU SHALL BE DEEMED TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

Sincerely,

__________________________________ ________________________

FINAL NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

You were previously sent a Notice of Transfer and Certificate of Assumption
notifying you that Zenith Insurance Company has agreed to replace RISCORP
National Insurance Company as your insurer under [insert policy/certificate name
and number] effective [insert date]. Zenith Insurance Company's principal place
of business is ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇;
however, all correspondence with Zenith Insurance Company concerning your policy
should be sent to ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. Certain financial
information concerning both companies was attached to the First Notice of
Transfer and Certificate of Assumption previously sent to you, including: (1)
ratings for the last five years if available or for such lesser period as is
available from two nationally recognized insurance rating services; (2) balance
sheets for the previous three years if available or for such lesser period as is
available and as of a date no later than ninety days prior to the current date;
and (3) an explanation of the reason for the transfer. If you would like
additional copies of this financial information, please contact Zenith Insurance
Company at the addresses supplied above. You may obtain additional information
concerning Zenith Insurance Company from reference materials in your local
library or by contacting your Insurance Commissioner at [insert address and
phone number]. Zenith Insurance Company is licensed in your state.

YOUR RIGHTS

We are sending you a final notice because we did not receive the
pre-addressed response card or other written notice from you indicating your
rejection of the proposed transfer. If you want your policy transferred to
Zenith Insurance Company, you may notify us in writing by signing and
returning the enclosed pre-addressed, postage-paid card or by writing to us
at:

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS. IF WE DO NOT RECEIVE YOUR WRITTEN
REJECTION WITHIN TWO MONTHS, YOU WILL BE DEEMED TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP National
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, Zenith Insurance Company will be your insurer.
It will have direct responsibility to you for the payment of all claims,
benefits and for all other policy obligations. RISCORP National Insurance
Company will no longer have any obligations to you.

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

Sincerely,

__________________________________ ________________________

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

[NOTICE DATE]

RESPONSE CARD

_________ YES, I accept the transfer of my policy
from RISCORP National Insurance Company to
Zenith Insurance Company.

_________ NO, I reject the proposed transfer of
my policy from RISCORP National Insurance Company
to Zenith Insurance Company and wish
to retain my policy with RISCORP National
Insurance Company.

_____________ ____________________________________
DATE SIGNATURE

NAME:__________________________________________________________________

STREET ADDRESS:________________________________________________________

CITY, STATE, ZIP:______________________________________________________

NORTH CAROLINA EXHIBIT A

NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

Zenith Insurance Company has agreed to replace RISCORP National Insurance
Company as your insurer under [insert policy/certificate name and number]
effective [insert date]. Zenith Insurance Company's principal place of business
is ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇; however, all
correspondence with Zenith Insurance Company concerning your policy should be
sent to ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. Certain financial
information concerning both companies are attached, including: (1) ratings for
the last five years if available or for such lesser period as is available from
two nationally recognized insurance rating services; (2) balance sheets for the
previous three years if available or for such lesser period as is available and
as of a date no later than ninety days prior to the current date; (3) a copy of
the Management Discussion and Analysis filed as a supplement to the previous
year's annual statement; and (4) an explanation of the reason for the transfer.
You may obtain additional information concerning Zenith Insurance Company from
reference materials in your local library or by contacting your Insurance
Commissioner at [insert address and phone number]. Zenith Insurance Company is
licensed in your state.

YOUR RIGHTS

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN [TWENTY FIVE] MONTHS OF THIS
NOTICE OF TRANSFER, YOU WILL, AS A MATTER OF LAW HAVE CONSENTED TO THE TRANSFER.
HOWEVER, BEFORE THIS CONSENT IS FINAL, YOU WILL BE SENT A SECOND NOTICE,
TWENTY-FOUR MONTHS AFTER OUR FIRST NOTICE. IF WE DO NOT RECEIVE YOUR WRITTEN
REJECTION WITHIN ONE MONTH AFTER THE DATE OF THE SECOND NOTICE, YOU WILL BE
DEEMED TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, Zenith Insurance Company will be your insurer.
It will have direct responsibility to you for the payment of all claims,
benefits and for all other policy obligations. RISCORP National Insurance
Company will no longer have any obligations to you.

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

Sincerely,

__________________________________ ________________________

SECOND NOTICE
NOTICE OF TRANSFER AND CERTIFICATE OF ASSUMPTION

IMPORTANT: THIS NOTICE AFFECTS YOUR CONTRACT RIGHTS. PLEASE READ IT CAREFULLY.

TRANSFER OF POLICY

You were previously sent a Notice of Transfer and Certificate of
Assumption notifying you that Zenith Insurance Company has agreed to replace
RISCORP National Insurance Company as your insurer under [insert policy/
certificate name and number] effective [insert date]. Zenith Insurance
Company's principal place of business is ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇; however, all correspondence with Zenith Insurance
Company concerning your policy should be sent to ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇. Certain financial information concerning both companies was
attached to the First Notice of Transfer and Certificate of Assumption
previously sent to you, including: (1) ratings for the last five years if
available or for such lesser period as is available from two nationally
recognized insurance rating services; (2) balance sheets for the previous
three years if available or for such lesser period as is available and as of a
date no later than ninety days prior to the current date; (3) a copy of the
Management Discussion and Analysis filed as a supplement to the previous year's
annual statement; and (4) an explanation of the reason for the transfer.
If you would like additional copies of this financial information, please
contact Zenith Insurance Company at the addresses supplied above. You may
obtain additional information concerning Zenith Insurance Company from reference
materials in your local library or by contacting your Insurance Commissioner at
[insert address and phone number]. Zenith Insurance Company is licensed in your
state.

YOUR RIGHTS

RISCORP National Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇

IF YOU DO NOT WANT YOUR POLICY TRANSFERRED, YOU MUST NOTIFY US IN WRITING BY
SIGNING AND RETURNING THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID CARD OR BY
WRITING TO US AT THE ABOVE ADDRESS.

IF WE DO NOT RECEIVE YOUR WRITTEN REJECTION WITHIN ONE MONTH YOU WILL BE DEEMED
TO HAVE ACCEPTED THE TRANSFER.

If you reject the transfer, you may keep your policy with RISCORP National
Insurance Company or exercise any option under your policy.

EFFECT OF TRANSFER

If you accept this transfer, you should make all premium payments and
claims submissions to Zenith Insurance Company and direct all questions to
Zenith Insurance Company.

For your convenience, a pre-addressed postage-paid response card is
enclosed. Please take time now to read the enclosed notice and complete and
return the response card.

If you have any further questions about this agreement, you may contact
RISCORP National Insurance Company or Zenith Insurance Company.

Sincerely,

__________________________________ ________________________

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

RESPONSE CARD

_________ YES, I accept the transfer of my policy
from RISCORP National Insurance Company to
Zenith Insurance Company.

_________ NO, I reject the proposed transfer of
my policy from RISCORP National Insurance Company
to Zenith Insurance Company and wish
to retain my policy with RISCORP National
Insurance Company.

_____________ ____________________________________
DATE SIGNATURE

NAME:__________________________________________________________________

STREET ADDRESS:________________________________________________________

CITY, STATE, ZIP:______________________________________________________

EXHIBIT B

RISCORP NATIONAL INSURANCE ZENITH INSURANCE COMPANY
COMPANY ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
ONE SARASOTA TOWER SARASOTA, FLORIDA 34236
SUITE 608
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇

NOTICE AND CERTIFICATE OF ASSUMPTION

Policy No: ____________

Issued to: ____________

THIS CERTIFICATE certifies and you are hereby notified that, pursuant to the
terms of an Assumption and Indemnity Reinsurance Agreement, the above policy and
all of its endorsements (the "Policy") issued by RISCORP Insurance Company have
been assumed by Zenith Insurance Company. This change is effective as of 12:01
a.m. Eastern Standard Time on [Effective Date].

All terms and conditions of the Policy remain unchanged, except that Zenith
Insurance Company shall be the insurer. Zenith Insurance Company shall have all
of the rights and obligations of RISCORP Insurance Company under the Policy as
though it had issued the Policy originally. All payments, correspondence and
inquiries such as policy changes, notices, claims or suits or actions on the
Policy shall in the future be submitted directly to Zenith Insurance Company at
the address indicated above.

This Notice and Certificate of Assumption forms a part of and should be attached
to the Policy issued by RISCORP Insurance Company.

IN WITNESS WHEREOF, RISCORP Insurance Company and Zenith Insurance
Company have each caused this Notice and Certificate of Assumption to be signed
by their duly authorized officers in facsimile to become effective as their
original signatures.

___________________ ________________________

RISCORP NATIONAL INSURANCE COMPANY ZENITH INSURANCE COMPANY
ONE SARASOTA TOWER ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇

-3-

EXHIBIT C

ZENITH INSURANCE COMPANY
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇

[ADDRESSEE]

Reference: RISCORP Insurance Company
Policy No: ____________
Issued to: ____________
Claim No: _____________

Dear Claimant:

This notice is sent to you in connection with your pending claim.
Please be advised that the captioned insurance policy (the "Policy") has been
assumed by Zenith Insurance Company, effective as of 12:01 a.m. Eastern Standard
Time on [Effective Date].

All correspondence and inquiries relating to your claim or suits or
actions on the Policy shall in the future be submitted directly to Zenith
Insurance Company at the address indicated above.

________________________

ZENITH INSURANCE COMPANY
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇

ASSUMPTION AND INDEMNITY REINSURANCE AGREEMENT by and between ZENITH INSURANCE COMPANY and RISCORP NATIONAL INSURANCE COMPANY Dated as of April 1, 1998 TABLE OF CONTENTS

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