EXHIBIT 10.1

                 Description of Compensatory Arrangement between
                  Alleghany Corporation and John J. Burns, Jr.

      After retiring as an officer of Alleghany Corporation (the "Company") and
its subsidiaries on December 30, 2004, John J Burns, Jr. will become
non-executive Vice Chairman of the Board of Directors effective December 31,
2004, and will continue as a director of the Company. Mr. Burns will also
continue as an employee of the Company following his retirement as an officer
upon the following terms:

      a.    Mr. Burns will receive an annual salary of $370,000 commencing
            January 1, 2005.

      b.    Mr. Burns will not be entitled to receive director or committee
            member fees for his service on the Board of Directors of the
            Company, and will not be a participant in the Directors' Equity
            Compensation Plan, the 2000 Directors' Stock Option Plan or the
            No-Employee Directors' Retirement Plan, so long as he is an employee
            of the Company.

      c.    Mr. Burns will continue to participate in the Company's Deferred
            Compensation Plan, Executive Retirement Plan, and the medical,
            long-term disability and other Company employee welfare plans. In
            addition, the Company will continue to maintain life insurance
            providing a death benefit to Mr. Burns equal to four times his
            salary.

      d.    Mr. Burns will not participate in the Company's Management Incentive
            Plan, under which annual bonuses are paid out, and will not be
            granted any new performance shares or other awards under the
            Company's 2002 Long-Term Incentive Plan. Outstanding performance
            shares held by Mr. Burns will continue to earn out in accordance
            with their terms. Upon termination of Mr. Burn's employment prior to
            payout of such outstanding performance shares, his then outstanding
            performance shares will be paid out on a pro rata basis in
            accordance with their terms.