2005 MANAGEMENT INCENTIVE PLAN

<PAGE>

                                                                  EXHIBIT 10.02

                              ALLEGHANY CORPORATION

                            MANAGEMENT INCENTIVE PLAN

      1. PURPOSE OF THE PLAN. The purpose of the Alleghany Corporation

Management Incentive Plan (the "Plan") is to allow Alleghany Corporation (the

"Company") to provide performance-based incentive compensation that satisfies

the requirements for performance-based compensation in Section 162(m) of the

Internal Revenue Code of 1986, as amended (the "Code"), consisting of incentive

compensation bonuses to its officers, upon whom, in large measure, the sustained

progress, growth and profitability of the Company depends.

      2. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the

Compensation Committee of the Board of Directors of the Company (the

"Committee"). Subject to the provisions of the Plan, the Committee shall have

the exclusive authority to select the officers to participate in the Plan, to

establish performance goals for performance during each Performance Period (as

defined in Section 4), to determine the amount of the incentive compensation

bonus payable to any Participant (as defined in Section 3), and to make all

determinations and take all other actions necessary or appropriate for the

proper administration and operation of the Plan. Any determination by the

Committee on any matter relating to the Plan shall be made in its sole

discretion and need not be uniform among Participants. The Committee's

interpretation of the Plan shall be final, conclusive and binding on all parties

concerned, including the Company, its stockholders and any Participant.

      3. ELIGIBILITY. Incentive compensation bonuses under the Plan may be paid

to those officers (including officers who are directors) of the Company who

shall be selected by the Committee after consideration of management's

recommendations ("the Participants").

<PAGE>

Participants may receive multiple incentive compensation bonuses during the same

year under the Plan.

      4. PERFORMANCE PERIODS. Incentive compensation bonuses may be payable to

each Participant as a result of the satisfaction of performance goals in respect

of the calendar year or such other period as is selected by the Committee (a

"Performance Period").

      5. INCENTIVE COMPENSATION BONUSES.

            (a) Target Incentive Compensation Bonuses. Prior to the beginning of

      each Performance Period, or at such other time no later than such time as

      is permitted by the applicable provisions of the Code, the Committee after

      consideration of management's recommendations shall establish in writing

      the target (or range of) incentive compensation bonus opportunity for each

      Participant based upon the attainment of one or more performance goals

      established by the Committee at such time. The Committee may provide for a

      threshold level of performance below which no amount of incentive

      compensation bonus will be paid and a maximum level of performance above

      which no additional incentive compensation bonus will be paid, and it may

      provide for the payment of differing amounts for different levels of

      performance.

            (b) Performance Goals. Performance goals, which may vary from

      Participant to Participant and target incentive compensation bonus

      opportunity to target incentive compensation bonus opportunity, shall be

      based upon the attainment of specific amounts of, or increases in, one or

      more of the following: revenues, operating income, cash flow, earnings

      before income taxes, net income, earnings per share, stockholders' equity,

      return on equity, underwriting profits, compound growth in net loss and

      loss adjustment expense reserves, loss ratio or combined ratio of the

      Company's insurance businesses, operating

                                      -2-

<PAGE>

      efficiency or strategic business objectives consisting of one or more

      objectives based on meeting specified cost targets, business expansion

      goals and goals relating to acquisitions or divestiture