completed operations hazard.

5. Subject to Paragraphs B.2., B.3. and B.4. above, the Occurrence Limit shown in Item 4.A. of the Declarations is the most we will pay for all loss arising out of any one occurrence to which this policy applies.

6. Subject to Paragraphs B.2., B.3., B.4. and B.5. above, if the limits of Underlying Insurance shown in Item 6. of the Declarations are reduced or exhausted solely by payment of loss to which this policy applies, such insurance provided by this policy will apply in excess of the reduced limits of Underlying Insurance or, if the Total Limits Of All Underlying Insurance shown in Item 6.B. of the Declarations are exhausted, will apply as underlying insurance subject to the same terms, conditions, definitions, limitations and exclusions of the Controlling Underlying Policy, except for the terms, conditions, definitions, limitations and exclusions of this policy.

7. Any amounts we pay for loss reduce the Limits of Insurance shown in Item 4. of the Declarations.

8. The Limits of Insurance of this policy apply separately to each consecutive annual period and to any remaining period of less than 12 months, starting with the beginning of the Policy Period shown in the Declarations, unless the Policy Period is extended after issuance for an additional period of less than 12 months. In that case, the additional period will be deemed part of the preceding period for purposes of determining the Limits of Insurance.

SECTION III. DEFENSE AND SUPPLEMENTARY PAYMENTS

A. We will not be required to assume charge of the investigation of any claim or defense of any suit against you.

B. We will have the right, but not the duty, to be associated with you or your underlying insurer or both in the investigation of any claim or defense of any suit which in our opinion may create liability on us for payment under this policy.

C. If the Total Limits Of All Underlying Insurance shown in Item 6. of the Declarations are exhausted solely by payment of loss, we will have the right but not the duty to investigate and settle any claim or assume the defense of any suit which in our opinion may give rise to a payment under this policy. We may, however, withdraw from the defense of such suit and tender the continued defense to you if our applicable Limits of Insurance stated in Item 4. of the Declarations are exhausted by our payment of loss.

D. If we exercise our rights under Paragraphs B. or C. above, we will pay the following:

1. All expenses we incur;

2. Prejudgment interest awarded against the insured on that part of the judgment we pay. If we make an offer to pay the applicable Limits of Insurance, we will not pay any prejudgment interest based on that period of time after the offer; and

3. All interest on that part of a judgment to which this insurance applies, that accrues after entry of the judgment and before we have paid, offered to pay, or deposited in court the part of the judgment that is within the applicable Limits of Insurance.

When our expenses and payments as described in this paragraph are not included in the definition of loss, they will not reduce the Limits of Insurance.

SECTION IV. EXCLUSIONS

This policy does not apply to any liability, damage, loss, cost or expense:

ASBESTOS

A. Arising out of or related in any way to:

1. Asbestos or which would not have occurred in whole or in part but for the actual, alleged or threatened discharge, dispersal, release, leakage, leaching, friability, flaking escape or presence of asbestos, regardless of whether any other cause, event, material or product contributed concurrently or in any sequence to any injury or damage; or

2. Any:

a. Request, demand, order, statutory or regulatory requirement, direction or determination, that any insured or others test for, investigate, monitor, clean up, remove, study, contain, treat, encapsulate, control or take any other action regarding asbestos; or