SCPIE HOLDINGS INC
GUARANTEE AGREEMENT
<DOCUMENT>
<TYPE>EX-10.71
<SEQUENCE>13
<FILENAME>dex1071.txt
<DESCRIPTION>GUARANTEE AGREEMENT
<TEXT>
<PAGE>

                                                                   Exhibit 10.71

[LOGO]Ashurst Morris Crisp


Guarantee Agreement

SCPIE HOLDINGS INC.

and

GOSHAWK REINSURANCE LIMITED




2002

<PAGE>

THIS AGREEMENT is made on                2002

BETWEEN

(1)    SCPIE HOLDINGS INC. whose registered address is 1888 Century Park East,
       Suite 800, Los Angeles, California, 90067-1712 (the "Guarantor"); and

(2)    GOSHAWK REINSURANCE LIMITED whose registered address is 31 Church Street,
       Hamilton, Bermuda HM12 (the "Reinsurer").

WHEREAS

(A)    SCPIE Indemnity Company, American Healthcare Indemnity Company and
       American Healthcare Specialty Insurance Company (collectively the
       "Company") (1) and the Reinsurer (2) intend to enter on the date hereof
       into a quota share retrocession contract in the form set out in schedule
       1 hereto ("Reinsurance Agreement") and certain agreed form agreements
       referred to therein and including the Security Fund Agreement and the
       Trust Agreement as set out at schedule 2 hereto.

(B)    The Guarantor has agreed to guarantee the obligations of the Company
       under the Reinsurance Agreement, Security Fund Agreement and Trust
       Agreement on and subject to the terms of this agreement.

1.     GUARANTEE

1.1    In consideration for the Reinsurer entering into and assuming its
       obligations under the Reinsurance Agreement, Security Fund Agreement and
       Trust Agreement (together the "Transaction Agreements") the Guarantor
       hereby irrevocably and unconditionally guarantees to the Reinsurer as
       principal obligor the due and punctual performance and observance by the
       Company of all of its obligations under each of the Transaction
       Agreements ("this Guarantee"); provided that nothing in this Guarantee
       shall oblige the Guarantor to act as an insurer or reinsurer in breach of
       the laws of the United States.

1.2    In any action under this Guaranty the guarantor shall have all defences
       available to the Company in performance of its obligations under the
       Transaction Agreements.

2.     CONTINUING OBLIGATION

       This Guarantee is to be a continuing obligation which shall remain in
       full force and effect until all of the obligations of the Company under
       each of the Transaction Agreements shall have been fulfilled or shall
       have expired in accordance with the terms of each such agreement and this
       Guarantee is to be in addition, and without prejudice to, and shall not
       merge with, any other right, remedy, guarantee, indemnity or security
       which the Reinsurer may now or hereafter hold in respect of all or any of
       the obligations of the Company under the Transaction Agreements.

3.     REINSURER'S PROTECTIONS

       The liability of the Guarantor under this Guarantee shall not be
       affected, impaired or discharged by reason of any act, omission, matter
       or thing which but for this provision might

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       operate to release or otherwise exonerate the Guarantor from its
       obligations hereunder including, without limitation:

       (a)  the taking, variation, compromise, renewal, release, refusal or
            neglect to perfect or enforce any rights, remedies or securities
            against the Company or any other person;

       (b)  any time or indulgence or waiver given to, or composition made with,
            the Company or any other person; or

       (c)  the Company becoming insolvent, going into receivership or
            liquidation or having a conservator, liquidator or statutory
            successor (or other administrator) appointed.

4.     FURTHER PROTECTION

       This Guarantee shall continue in full force and effect notwithstanding:

       (a)  that any purported obligation of the Company or any other person to
            the Reinsurer (or any security therefor) becomes wholly or partly
            void, invalid or unenforceable for any reason whether or not known
            to the Reinsurer or the Guarantor; or

       (b)  any incapacity or any change in the constitution of, or any
            amalgamation or reconstruction of, the Guarantor or the Company or
            any other matter whatsoever.

5.     PRIMARY OBLIGATIONS

       This Guarantee shall constitute the primary obligations of the Guarantor
       and the Reinsurer shall not be obliged to make any demand on the Company
       before enforcing its rights against the Guarantor under this Guarantee.
       The Guarantor therefore agrees that this guarantee provided herein is a
       guaranty of payment and performance and not of collection. The Guarantor
       waives any right that any resort be had by the Reinsurer to any security,
       assets, funds, or property held or actionable against by the Reinsurer as
       security for the obligations of the Company, or otherwise, to the
       Reinsurer, any other monetary obligations of the Company to the
       Reinsurer, or the Reinsurer's rights against any other guarantor or
       obligor of the obligations of the Company.

6.     WAIVER

       No delay or omission of the Reinsurer in exercising any right, power or
       privilege under this Guarantee shall impair such right, power or
       privilege or be construed as a waiver of such right, power or privilege
       nor shall any single or partial exercise of any such right, power or
       privilege preclude any further exercise thereof or the exercise of any
       other right, power or privilege.

7.     INVALIDITY

       If at any time any one or more of the provisions of this Guarantee is or
       becomes invalid, illegal or unenforceable in any respect under any law,
       the validity, legality and enforceability of the remaining provisions
       hereof shall not be in any way affected or impaired thereby.

                                      -2-

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8.     WARRANTIES

       Without prejudice to the Guarantor's guarantee hereunder of the
       warranties given by the Company to the Reinsurer pursuant to the
       Reinsurance Agreement, which guarantee shall be subject to the same
       qualifications and limitations to which such warranties are subject in
       the Reinsurance Agreement, the Guarantor hereby represents and warrants
       to the Reinsurer in the terms of the warranties set out in schedule 3
       hereto ("Warranties"). The Guarantor's representations and warranty in
       respect of each of the Warranties shall be deemed repeated continually
       throughout the term of this agreement. The Guarantor undertakes that it
       will disclose forthwith in writing to the Reinsurer any matter which
       becomes known to it which is inconsistent with any of the Warranties
       given by it hereunder or which is inconsistent with any of the warranties
       given by the Company under the Reinsurance Agreement. Without restricting
       the rights of the Reinsurer or the ability of the Reinsurer to claim
       damages on any basis available to it, but subject to the provisions of
       the second paragraph of schedule 3 hereto, if the Guarantor is in breach
       of any of the Warranties or any other term of this agreement the
       Guarantor shall pay to the Reinsurer on demand as damages the amount
       necessary on a full indemnity basis to put the Reinsurer into the
       position which would have existed if the said Warranties or other term of
       this agreement had not been breached, together with all costs and
       expenses incurred by the Reinsurer as a result of such breach.

9.     INCORPORATION OF TERMS

       The terms of Articles 19 (Notice), 20 (Waiver and Amendment), 21 (No
       Partnership), 22 (No Assignment), 24 (Arbitration), 25 (Service of Suit)
       and 26 (Mode of Execution) of the Reinsurance Agreement shall be deemed
       incorporated into this agreement save that:

       (a)  for the purposes of Article 19.A (Notice) the address for notice for
            the Guarantor shall be:

            SCPIE Holdings Inc.
            1888 Century Park East
            Suite 800
            Los Angeles
            California
            90067 - 1712

            Fax:  (310) 551 5924

            Attention:  President

       (b)  for the purposes of the Article 25 (Service of Suit) service of
            process shall be duly served upon the Guarantor if delivered
            personally or sent by registered post to 1888 Century Park East,
            Suite 800, Los Angeles, California 90067-1712 (marked for the
            attention of the President of SCPIE Holdings Inc.) or to such other
            person and address as the Guarantor shall notify the Reinsurer in
            writing from time to time.

                                      -3-

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10.    COUNTERPARTS

       This Guarantee may be executed in any number of counterparts, each of
       which when so executed and delivered shall constitute an original, but
       such counterparts together shall constitute one and the same agreement.

IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed
by their duly authorised representatives this 18th day of December 2002.


/s/ Donald J. Zuk, President
---------------------------------
for and on behalf of
SCPIE HOLDINGS INC.



/s/ Jonathan Beck   /s/ J. Kemp
---------------------------------
for and on behalf of
GOSHAWK REINSURANCE LIMITED

                                      -4-

<PAGE>

                                   SCHEDULE 1

                              REINSURANCE AGREEMENT

                                      -5-

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                                   SCHEDULE 2

                   TRUST AGREEMENT AND SECURITY FUND AGREEMENT

                                      -6-

<PAGE>

                                   SCHEDULE 3

Any Warranty expressed to be given "to the best of the Guarantor's knowledge and
belief" shall not be qualified in the manner stated unless the Guarantor
establishes it has made all reasonable enquiries of its directors, employees and
professional advisers (including its accountants and actuaries) and relevant
third parties to establish the truth and accuracy of that Warranty.

The Guarantor shall be under no liability in respect of a claim under any of the
Warranties at paragraphs 3, 4, and 5 of this schedule 3 unless and until the
liability of the Guarantor in respect of that claim when aggregated with the
liability of the Guarantor in respect of all other such claims under paragraphs
3, 4, and 5 of this schedule 3 shall exceed US$100,000 (and then the Reinsurer
shall be entitled to recover all and not just the excess).

1.     GUARANTOR'S CAPACITY

1.1    Authorisations

       The Guarantor has obtained all corporate authorisations and all other
       applicable governmental, statutory, regulatory or other consents,
       licences, waivers or exemptions required to empower it to enter into and
       to perform its obligations under this agreement.

1.2    Proper Execution

       The Guarantor's obligations under this agreement are enforceable in
       accordance with their terms.

2.     INSOLVENCY

2.1    No order has been made, petition presented or resolution passed, or any
       other action taken, for the winding up of or for the appointment of a
       liquidator, conservator or statutory successor to the Guarantor or in
       relation to any part of its business and/or assets and to the best of the
       Guarantor's knowledge and belief no such order, petition, resolution or
       other action is pending or contemplated. No transfer of assets is being
       made by the Guarantor and no obligation is being incurred by it in
       connection with the transactions contemplated by this agreement and/or
       the Transaction Agreements with the intent to hinder, delay, or defraud
       either the present or future creditors of the Guarantor.

2.2    The Guarantor has assets exceedingly its liabilities (as such terms are
       defined by Generally Accepted Accounting Principles and statutory
       accounting principles applied on a consistent basis) and is not insolvent
       as provided by the Uniform Fraudulent Transfer Act.

3.     LEGAL COMPLIANCE

       The Guarantor is in compliance with all laws, rules and regulations
       applicable to the Guarantor and all elements related to its business,
       operations and financial condition, including, but not limited to, its
       assets, holdings and employees, as the case may be.

4.     FINANCIAL CONDITION

       The financial statements of the Guarantor accurately and honestly present
       the Guarantor's financial condition. Since the date of the most recent
       financial statements of the Company, there

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       has been no adverse change in the Guarantor's business, assets or
       condition (financial or otherwise).

5.     LITIGATION

       There are no actions, suits or proceedings pending, threatened or
       contemplated against or affecting the Guarantor or its assets except for
       claims (i) that are disclosed by the Guarantor in any reports filed by
       the Guarantor with the United States Securities and Exchange Commission
       (which reports at the date of this guarantee agreement contain no details
       of current material litigation); or (ii) that do not exceed US$10,000
       individually or US$100,000 in aggregate.

6.     TAXES

       The Guarantor has paid or caused to be paid to the proper authorities
       when due all federal, state and local taxes applicable to it. The
       Guarantor has filed with the proper authorities when due all federal,
       state and local tax returns applicable to it.

7.     OTHER AGREEMENTS

       The Guarantor is not bound by any letter of intent, exclusivity
       agreement, heads of agreement or equivalent agreement relating to the
       Contracts (as defined in the Reinsurance Agreement) or the Company.

                                      -8-

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