2004 2003 2002 Service cost $1,061 $543 $370 Interest cost 447 374 325 Curtailment credit (582) — — Net amortization and deferral (63) 28 (17) Net cost $ 863 $945 $ 678 Year Amount 2005 $ 237 2006 257 2007 303 2008 356 2009 381 2010-2014 3,048 The accumulated benefit obligation for the postretirement benefit plan was $8.5 million and $8.3 million as of December 31, 2004 and 2003, respectively. The postretirement plan’s expected benefit payments ar shown below (in thousands): Net periodic cost included the following components (in thousands): The plan change of $1.3 million and the unrecognized prior service cost of $0.7 million as of December 31, 2004 result from a change in eligibility for postretirement medical benefits, which pr eviously had no age limitation, to age 45 and 10 years of service and the adoption of the Medicare Reform Act. The curtailment cr edit of $0.6 million is the result of the eligibility change. The annual assumed rate of increase in the per capita cost of cover ed benefits (i.e., health care cost trend rate) is assumed to be 11.5% in 2004 and decreasing to 5% in 2013 and remaining constant thereafter. The health care cost trend rate assumption has a significant effect on the amounts reported. For example, increasing the assumed health care cost trend rates by one percentage point in each year would increase the accumulated postretirement benefit obligation by $1.7 million and the service and interest cost components of net periodic postretirement benefit costs by $0.4 million for 2004. Decreasing the assumed health care cost trend rates by one percentage point in each year would decrease the accumulated postretirement benefit obligation, and the service and interest cost components of net periodic postretirement benefit cost for 2004 by $1.4 million and $0.3 million, respectively. In April 2002, the Company’s stockholders approved the Odyssey Re Holdings Corp. 2002 Stock Incentive Plan (the “2002 Plan”). An aggregate of 1.5 million shares of the Company’ common stock may be granted under the 2002 Plan. The 2002 Plan provides for the grant of non-qualified stock options to officers, key employees and directors who are employed by, or provide services to, the Company or its subsidiaries. Pursuant to the 2002 Plan, 25% of the options granted become exercisable on each annual anniversary of the grant in each of the four years following the grant and expire 10 years from the date of grant, and shall be exercisable at the grant price. As of December 31, 2004 and 2003, a total of 793,250 stock options have been granted under the 2002 Plan at a weighted average price of $18.68 per share. No options were granted in 2004 pursuant to the 2002 Plan. As of December 31, 2004, there were 706,750 remaining stock options available to be granted. 10. STOCK BASED COMPENSATION PLANS 71 ODYSSEY RE HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued