Exhibit 10.2

ASPEN INSURANCE HOLDINGS LIMITED

NON-EMPLOYEE DIRECTOR

NONQUALIFIED SHARE OPTION AGREEMENT

THIS AGREEMENT (the ‘‘Agreement’’), is made effective as of the          day of
                                , 2006 (hereinafter called the ‘‘Date of
Grant’’), between Aspen Insurance Holdings Limited, a Bermuda corporation
(hereinafter called the ‘‘Company’’), and                             
(hereinafter called the ‘‘Participant’’):

RECITALS:

WHEREAS, the Company has adopted the Aspen Insurance Holdings Limited 2006 Stock
Option Plan for Non-Employee Directors (the ‘‘Plan’’), which Plan is
incorporated herein by reference and made a part of this Agreement. Capitalized
terms not otherwise defined herein shall have the same meanings as in the Plan;
and

WHEREAS, the Committee has determined that it would be in the best interests of
the Company and its shareholders to grant the stock options provided for herein
to the Participant pursuant to the Plan and the terms set forth herein.

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth,
the parties agree as follows:

[spacer.gif] [spacer.gif] 1.  Grant of the Option. The Company hereby grants to
the Participant the right and option to purchase, on the terms and conditions
hereinafter set forth, all or any part of an aggregate of                     
Shares (the ‘‘Option’’), subject to adjustment as set forth in the Plan. The
purchase price of the Shares subject to the Option shall be $                
per Share (the ‘‘Option Price’’).

[spacer.gif] [spacer.gif] 2.  Vesting.

[spacer.gif] [spacer.gif] [spacer.gif] (a)  Subject to the Participant’s
continued Service as a director of the Company, Shares underlying the Option
shall become vested on the third anniversary of the Date of Grant.

[spacer.gif] [spacer.gif] [spacer.gif] (b)  In connection with any event
described in Section 7(a) of the Plan or in the event of a change in applicable
accounting rules, the Committee shall make such substitutions or adjustments in
the terms of the Option, if any, as it shall determine shall be necessary to
equitably reflect such event in order to prevent dilution or enlargement of the
potential benefits of the Option. The Committee’s determination as to any such
adjustment or substitution shall be final.

[spacer.gif] [spacer.gif] [spacer.gif] (c)  If the Participant’s Service with
the Company is terminated for any reason and the Option is not then vested, it
shall be canceled by the Company without consideration.

[spacer.gif] [spacer.gif] 3.  Exercise of Option.

[spacer.gif] [spacer.gif] [spacer.gif] (a)  Right to Exercise. Once the Option
has vested it shall become immediately exercisable.

[spacer.gif] [spacer.gif] [spacer.gif] (b)  Period of Exercise. Subject to the
provisions of the Plan and this Agreement, the Participant may exercise all or
any part of the vested Option at any time prior to the earliest to occur of:

[spacer.gif] [spacer.gif] [spacer.gif] (i)  the tenth anniversary of the Date of
Grant;

[spacer.gif] [spacer.gif] [spacer.gif] (ii)  the first anniversary of the
Participant’s termination of Service other than for Cause; and

[spacer.gif] [spacer.gif] [spacer.gif] (iii)  the date of the Participant’s
termination of Service by the Company for Cause.

For purposes of this Agreement, ‘‘Cause’’ shall mean (i) Participant’s
engagement in misconduct which is materially injurious to the Company or any of
its Affiliates, (ii) Participant’s continued failure to substantially perform
his or her duties as a director to the Company or any of its Affiliates, (iii)

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Participant’s repeated dishonesty in the performance of his or her duties as a
director to the Company or any of its Affiliates, or (iv) Participant’s
commission of an act or acts constituting any fraud against, or misappropriation
or embezzlement from the Company or any of its Affiliates. The determination of
the existence of Cause shall be made by the Committee in good faith.

[spacer.gif] [spacer.gif] [spacer.gif] (c)  Method of Exercise.

[spacer.gif] [spacer.gif] [spacer.gif] (i)  Subject to Section 3(b), the vested
Option may be exercised by delivering to the Company at its principal office
written notice of intent to so exercise; provided that the Option may be
exercised with respect to whole Shares only. Such notice shall specify the
number of Shares for which an Option is being exercised and the method of
payment of the Option Price. The Option Price for the Shares as to which the
Option is exercised shall be paid to the Company, as designated by the
Committee, pursuant to one or more of the following methods (subject in each
case to such conditions or restrictions as the Committee may prescribe): (A) in
cash or its equivalent (e.g., by check); (B) in Shares having a Fair Market
Value equal to the aggregate Option Price for the Shares being purchased and
satisfying such other requirements as may be imposed by the Committee; (C)
partly in cash and partly in such Shares; (D) by delivery of irrevocable
instructions to a broker to sell Shares obtained upon the exercise of the Option
and to deliver promptly to the Company an amount out of the proceeds of such
sale equal to the aggregate Option Price for the Shares being purchased; or (E)
by such other means as the Committee may prescribe. The Participant shall not
have any right to dividends or other rights of a shareholder with respect to
Shares subject to the Option until the Participant has given written notice of
exercise of the Option, paid in full for such Shares and, if applicable, has
satisfied any other conditions imposed by the Committee pursuant to the Plan.

[spacer.gif] [spacer.gif] [spacer.gif] (ii)  Notwithstanding any other provision
of the Plan or this Agreement to the contrary, the Option may not be exercised
prior to the completion of any registration or qualification of the Option or
the Shares under applicable state and federal securities or other laws, or under
any ruling or regulation of any governmental body or national securities
exchange that the Committee shall in its sole discretion determine to be
necessary or advisable.

[spacer.gif] [spacer.gif] [spacer.gif] (iii)  Upon the Company’s determination
that the Option has been validly exercised as to any of the Shares, the Company
shall issue certificates in the Participant’s name for such Shares. However, the
Company shall not be liable to the Participant for damages relating to any
delays in issuing the certificates to him, any loss of the certificates, or any
mistakes or errors in the issuance of the certificates or in the certificates
themselves.

[spacer.gif] [spacer.gif] [spacer.gif] (iv)  In the event of the Participant’s
death, subject to Section 6, the vested Option shall remain exercisable by the
Participant’s executor or administrator, or the person or persons to whom the
Participant’s rights under this Agreement shall pass by will or by the laws of
descent and distribution as the case may be, to the extent set forth in Section
3(b). Any heir or legatee of the Participant shall take rights herein granted
subject to the terms and conditions hereof.

[spacer.gif] [spacer.gif] 4.  No Right to Continued Service. The granting of the
Option evidenced hereby and this Agreement shall impose no obligation on the
Company or any Affiliate to continue the Service of the Participant and shall
not lessen or affect the Company’s or its Affiliate’s right to terminate the
Service of such Participant.

[spacer.gif] [spacer.gif] 5.  Legend on Certificates. The certificates
representing the Shares purchased by exercise of the Option shall be subject to
such stop transfer orders and other restrictions as the Committee may deem
advisable under the Plan or the rules, regulations, and other requirements of
the U.S. Securities and Exchange Commission, any stock exchange upon which such
Shares are listed, and any applicable laws, and the Committee may cause a legend
or legends to be put on any such certificates to make appropriate reference to
such restrictions.

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[spacer.gif] [spacer.gif] 6.  Transferability.

[spacer.gif] [spacer.gif] [spacer.gif] (a)  The Option may not be assigned,
alienated, pledged, attached, sold or otherwise transferred or encumbered by the
Participant otherwise than by will or by the laws of descent and distribution,
and any such purported assignment, alienation, pledge, attachment, sale,
transfer or encumbrance shall be void and unenforceable against the Company or
any Affiliate; provided that the designation of a beneficiary shall not
constitute an assignment, alienation, pledge, attachment, sale, transfer or
encumbrance; provided, further, that, upon written request by the Participant,
the Committee may, subject to such rules as the Committee may adopt, permit the
Option to be transferred or assigned by the Participant to (i) the Participant’s
spouse, children or grandchildren (including adopted and stepchildren and
grandchildren) (collectively, the ‘‘Immediate Family’’); (ii) a trust primarily
for the benefit of the Participant and/or members of his or her Immediate Family
(a ‘‘Family Trust’’); (iii) a partnership or limited liability company or other
entity whose only partners or other equity owners are a Family Trust, the
Participant and/or his or her Immediate Family members; or (iv) such
Participant’s employer in the event the Participant is a non-employee director
who is required to transfer any compensation received as non-employee director
to his or her employer (each transferee described in clauses (i), (ii), (iii)
and (iv) above is hereinafter referred to as a ‘‘Permitted Transferee’’). The
request by the Participant shall describe the terms and conditions of the
proposed transfer and the Committee shall notify the Participant in writing if
such a transfer will be permitted.

[spacer.gif] [spacer.gif] [spacer.gif] (b)  Following a permitted transfer
described in Section 6(a) above, all terms of the Option shall apply to the
Permitted Transferee and any reference in the Plan and in the Agreement to a
Participant shall be deemed to refer to the Permitted Transferee, except that
(i) Permitted Transferees shall not be entitled to transfer the Option, other
than by will or the laws of descent and distribution, (ii) Permitted Transferees
shall not be entitled to exercise any transferred Option unless there shall be
in effect a registration statement on an appropriate form covering the shares to
be acquired pursuant to the exercise of such Option if the Committee determines
that such a registration statement is necessary or appropriate, (iii) the
Committee or the Company shall not be required to provide any notice to a
Permitted Transferee, whether or not such notice is or would otherwise have been
required to be given to the Participant under the Plan or otherwise; provided
that, if such notice is not provided to the Permitted Transferee, such notices
are delivered by the Company to the Participant, and (iv) the consequences of
termination of the Participant’s Service under the terms of the Plan and the
Agreement shall continue to be applied with respect to the Participant,
following which the transferred Option shall be exercisable by the Permitted
Transferee only to the extent, and for the periods, specified in the Plan and
the Agreement. No permitted transfer of the Option to heirs, legatees or the
employer of the Participant shall be effective to bind the Company unless the
Committee shall have been furnished with written notice thereof and a copy of
such evidence as the Committee may deem necessary to establish the validity of
the transfer and the acceptance by the transferee or transferees of the terms
and conditions hereof.

[spacer.gif] [spacer.gif] [spacer.gif] (c)  Except as otherwise described in
this Section 6, during the Participant’s lifetime, the Option is exercisable
only by the Participant.

[spacer.gif] [spacer.gif] 7.  Withholding. The Participant may be required to
pay to the Company or any Affiliate and the Company shall have the right and is
hereby authorized to withhold, any applicable withholding taxes in respect of
the Option, its exercise or any payment or transfer under or with respect to the
Option and to take such other action as may be necessary in the opinion of the
Committee to satisfy all obligations for the payment of such withholding taxes.

[spacer.gif] [spacer.gif] 8.  Securities Laws. Upon the acquisition of any
Shares pursuant to the exercise of an Option, the Participant will make or enter
into such written representations, warranties and agreements as the Committee
may reasonably request in order to comply with applicable securities laws or
with this Agreement.

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[spacer.gif] [spacer.gif] 9.  Notices. Any notice necessary under this Agreement
shall be addressed to the Company in care of its Secretary at the principal
executive office of the Company and to the Participant at the address appearing
in the personnel records of the Company for the Participant or to either party
at such other address as either party hereto may hereafter designate in writing
to the other. Any such notice shall be deemed effective upon receipt thereof by
the addressee.

[spacer.gif] [spacer.gif] 10.  Choice of Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF BERMUDA, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES.

[spacer.gif] [spacer.gif] 11.  Option Subject to the Plan. By entering into this
Agreement the Participant agrees and acknowledges that the Participant has
received and read a copy of the Plan. The Option is subject to the Plan
(including without limitation the arbitration provision), and the terms and
provisions of the Plan, as it may be amended from time to time, are hereby
incorporated herein by reference. In the event of a conflict between any term or
provision contained herein and a term or provision of the Plan, the applicable
terms and provisions of the Plan will govern and prevail.

[spacer.gif] [spacer.gif] 12.  Rights as a Shareholder. The Participant shall
have no rights as a shareholder, and shall not receive dividends, with respect
to any Shares subject to the Option until the Option has been exercised and
Share certificates have been issued to the Participant.

[spacer.gif] [spacer.gif] 13.  Signature in Counterparts. This Agreement may be
signed in counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement.

[spacer.gif] ASPEN INSURANCE HOLDINGS LIMITED

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By:                                                                                

AGREED AND ACKNOWLEDGED AS
OF THE DATE FIRST ABOVE WRITTEN:

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Participant

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