**CE 71 00 (Ed. 04 97)**

**Page 3 of 7**

**Printed in U.S.A.**

**Section II - Liability and Expenses**

**A. When defense and supplementary payments of:**

1. Any "Underlying Insurance" reduce the limits of liability provided by such "Underlying Insurance," then any such expense payments made under this policy will reduce our Limits of Liability; or
2. None of the "Underlying Insurance" reduce the limits of liability provided by such "Underlying Insurance," then any such expense payments made under this policy will not reduce our Limits of Liability.

**B. We will only pay the following expenses:**

1. If the "Insured" becomes legally liable for interest that accrues on a judgment 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 our applicable Limits of Liability, then we will pay the interest on the part of the judgment to which this policy applies.
2. Expenses incurred directly by us and at our sole discretion.
3. Prejudgment interest awarded against the "Insured" on that part of the judgment we pay. However, if we make an offer to pay our applicable Limits of Liability prior to judgment, we will not pay any prejudgment interest that accrues after our offer.

**SECTION III -- EXCLUSIONS**

It is expressly agreed that this policy does not apply to:

**A. ASBESTOS**

1. To any injury, damage or expense of any nature whatsoever, caused by, arising out of or relating in any way to asbestos or any asbestos-containing product or material, or to the use, installation, removal, withdrawal or disposal of any such product or material.

**B. POLLUTION**

1. To any injury or damage arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants: