AMENDED AND RESTATED SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

EXHIBIT 10.3

AMENDED AND RESTATED SUPPLEMENTAL EXECUTIVE

RETIREMENT AGREEMENT

This Amended and Restated Supplemental Executive Retirement Agreement (“Agreement”) is made this 8th day of May, 2008 by and between AXIS Specialty Limited, a Bermuda company (“AXIS”), and Michael A. Butt (the “Executive”);

WHEREAS, the Compensation Committee of the Board of Directors of AXIS previously has determined that it is in the best interest of AXIS and its shareholders to provide the Executive with a supplemental retirement benefit in consideration for his continuing service with AXIS; and

WHEREAS, the Executive and AXIS previously entered into a Supplemental Executive Retirement Agreement dated January 1, 2004 (the “SERP Agreement”);

WHEREAS, the Executive and AXIS amended the SERP Agreement as of May 12, 2006; and

WHEREAS, the Executive and AXIS desire to amend and restate the SERP Agreement in its entirety in order to remedy an ambiguity in Exhibit A relating to the method used for calculating the “Offset Amount” (as defined herein);

NOW, THEREFORE, in consideration of the terms and conditions contained in this Agreement, AXIS and the Executive agree as follows:

1.  Retirement Benefit . Subject to the terms and conditions of this Agreement, the Executive shall be entitled to an annual “Retirement Benefit”, paid annually as of each January 1, beginning January 1, 2010 or, if earlier, the January 1 following the date on which the Executive’s employment with AXIS and its affiliates terminates for any reason (his “Termination Date”) and continuing through the tenth anniversary of such January 1 (the “Payment Period”) such that the Executive receives a total of ten annual payments hereunder. Each annual payment shall be made as soon as practicable following the applicable January 1. The amount of the Retirement Benefit payable to the Executive for any year during the Payment Period shall be equal to the “Applicable Amount” determined in accordance with Exhibit A hereto, which Exhibit A is incorporated into and forms a part of this Agreement; provided, however, that if the Executive’s Termination Date occurs prior to December 31, 2008, the amount of his Retirement Benefit for any year during the Payment Period shall be equal to (a) the product of the “Base Pension Amount” for such year determined in accordance with Exhibit A hereto multiplied by the Vesting Percentage determined in accordance with the following schedule as of his Termination Date, minus (b) the “Offset Amount” determined in accordance with Exhibit A hereto:

Notwithstanding the foregoing, if the Executive’s Termination Date occurs prior to December 31, 2008 on account of death, Disability (as defined in the AXIS Capital Holdings Limited 2003 Long-Term Equity Compensation Plan) or if a Change in Control (as defined in the Service Agreement) occurs prior to December 31, 2008, the Executive shall be fully vested in his Retirement Benefit hereunder. The Executive shall forfeit, and have no rights to, any portion of any Retirement Benefit which is not fully vested on his Termination Date or otherwise in accordance with the foregoing provisions of this Section 1.

2.  Payments on Death . Notwithstanding the provisions of Section 1, if the Executive dies prior to the date on which he has received all of the payments due to him hereunder, then all of the then remaining Retirement Benefits to which he is entitled hereunder, determined in accordance with Exhibit A (without any adjustment for early payment), shall be paid in a lump sum as soon as practicable following the Executive’s death to the trustees of the Acton Trust or such other person or entity nominated by the Executive in writing and delivered to AXIS.

3.  Payments on Disability . Notwithstanding the provisions of Section 1, if the Executive incurs a Disability prior to the date on which he has received all of the payments due to him hereunder, all of the then remaining Retirement Benefits to which he is entitled hereunder, determined in accordance with Exhibit A (without any adjustment for early payment), shall be paid to him in a lump sum as soon as practicable following the date of his Disability.

4.  Payments on Change in Con