<PAGE>

                                                                    Exhibit 10.5

                                                                  EXECUTION COPY

================================================================================

                           MBIA INSURANCE CORPORATION,
                                 as Note Insurer

                         CAPITAL ONE AUTO FINANCE, INC.,
                                   as Servicer

                         CAPITAL ONE AUTO FINANCE, INC.,
                                  as Transferor

                       CAPITAL ONE AUTO RECEIVABLES, LLC,
                                    as Seller

                            WILMINGTON TRUST COMPANY,
                         not in its individual capacity,
                         but solely as Owner Trustee for
                     Capital One Auto Finance Trust 2002-C,

                                       and

                              JPMORGAN CHASE BANK,
                              as Indenture Trustee

                               INSURANCE AGREEMENT

                                  $800,000,000
                      Capital One Auto Finance Trust 2002-C
                        Asset Backed Notes, Series 2002-C
                        Class A-1 Notes, Class A-2 Notes,
            Class A-3-A Notes, Class A-3-B Notes and Class A-4 Notes

                          Dated as of December 17, 2002

================================================================================

<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                  Page
<S>             <C>                                                               <C>

                                    ARTICLE I

DEFINITIONS........................................................................1

                                   ARTICLE II

                    REPRESENTATIONS, WARRANTIES AND COVENANTS

Section 2.01.   Representation and Warranties of the COAF Companies................9
Section 2.02.   Affirmative Covenants of the COAF Companies.......................12
Section 2.03.   Negative Covenants of the COAF Companies..........................18
Section 2.04.   Representation and Covenants of Indenture Trustee.................19
Section 2.05.   Representations, Warranties and Covenants of the Owner Trustee....19

                                   ARTICLE III

                           THE POLICIES; REIMBURSEMENT

Section 3.01.   Issuance of the Policies..........................................20
Section 3.02.   Payment of Fees and Premium.......................................22
Section 3.03.   Reimbursement and Additional Payment Obligation...................23
Section 3.04.   Indemnification; Limitation of Liability..........................25
Section 3.05.   Payment Procedure.................................................26
Section 3.06.   Reimbursement.....................................................27

                                   ARTICLE IV

                               FURTHER AGREEMENTS

Section 4.01.   Effective Date; Term of the Insurance Agreement...................27
Section 4.02.   Further Assurances and Corrective Instruments.....................27
Section 4.03.   Obligations Absolute..............................................27
Section 4.04.   Assignments; Reinsurance; Third-party Rights......................29
Section 4.05.   Liability of the Note Insurer.....................................29
Section 4.06.   No Proceedings....................................................30
Section 4.07.   Parties To Join in Enforcement Action.............................30

                                    ARTICLE V

                               DEFAULTS; REMEDIES

Section 5.01.   Defaults..........................................................31
Section 5.02.   Remedies; No Remedy Exclusive.....................................31
Section 5.03.   Waivers...........................................................32
</TABLE>

<PAGE>

<TABLE>
                                   ARTICLE VI

                                  MISCELLANEOUS

<S>             <C>                                                               <C>
Section 6.01.   Amendments, Etc...................................................33
Section 6.02.   Notices...........................................................33
Section 6.03.   Severability......................................................35
Section 6.04.   Governing Law.....................................................35
Section 6.05.   Consent to Jurisdiction...........................................35
Section 6.06.   Consent of the Note Insurer.......................................36
Section 6.07.   Counterparts......................................................36
Section 6.08.   Headings..........................................................36
Section 6.09.   Trial by Jury Waived..............................................36
Section 6.10.   Limited Liability.................................................36
Section 6.11.   Entire Agreement..................................................36
Section 6.12.   Limitation of Liability...........................................36
TESTIMONIUM
SIGNATURES
</TABLE>

                                       ii

<PAGE>

                               INSURANCE AGREEMENT

This INSURANCE AGREEMENT (this "Insurance Agreement") is dated as of December
17, 2002 by and among MBIA INSURANCE CORPORATION (the "Note Insurer"), CAPITAL
ONE AUTO FINANCE, INC., in its individual capacity and as the Servicer (the
"Servicer"), CAPITAL ONE AUTO FINANCE, INC., as Transferor (the "Transferor"),
CAPITAL ONE AUTO RECEIVABLES, LLC, as Seller (the "Seller"), WILMINGTON TRUST
COMPANY, not in its individual capacity but solely in its capacity as owner
trustee for Capital One Auto Finance Trust 2002-C (the "Owner Trustee") and
JPMORGAN CHASE BANK in its capacity as indenture trustee (the "Indenture
Trustee").

     WHEREAS, the Indenture Trustee is authenticating $800,000,000 principal
amount of the Capital One Auto Finance Trust 2002-C, Asset Backed Notes, Series
2002-C, Class A-1 Notes, Class A-2 Notes, Class A-3-A Notes, Class A-3-B Notes
and Class A-4 Notes, pursuant to an Indenture as more specifically defined
below. The Notes will be secured by the Trust Property as defined in the
Indenture;

     WHEREAS, the Owner Trustee, Seller, Transferor and Servicer have requested
that the Note Insurer issue its Note Guaranty Insurance Policy (the "Note
Policy") to guarantee payment of Insured Payments (as defined in Note Policy)
with respect to the Class A Notes, upon such terms and conditions as were
mutually agreed upon by the parties and subject to the terms and conditions of
the Note Policy and has asked the Note Insurer to issue an Interest Rate Swap
Policy (the "Swap Policy") and together with the Note Policy, the "Policies")
and the Note Insurer has agreed to insure certain amounts which may be due from
the Owner Trustee on behalf of Capital One Auto Finance Trust 2002-C (the
"Issuer") to the Swap Provider under the Swap Agreement;

     WHEREAS, the parties hereto desire to specify the conditions precedent to
the issuance of the Policies by the Note Insurer, the indemnity and
reimbursement to be provided by the Transferor and the Servicer in respect of
amounts paid by the Note Insurer under the Policies and to provide for certain
other matters;

     WHEREAS, the Note Insurer shall be paid an insurance premium pursuant to
the Indenture, and the details of such premium are set forth herein; and

     WHEREAS, each COAF Company (as defined below) has undertaken certain
obligations in consideration for the Note Insurer's issuance of the Policies;

     NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the parties hereto agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

     The terms defined in this Article I shall have the meanings provided herein
for all purposes of this Insurance Agreement, unless the context clearly
requires otherwise, in both singular and plural form, as appropriate. Unless the
context clearly requires otherwise, all

<PAGE>

capitalized terms used herein and not otherwise defined in this Article I shall
have the meanings assigned to them in the Transaction Documents (as defined
below). All words used herein shall be construed to be of such gender or number
as the circumstances require. This "Insurance Agreement" shall mean this
Insurance Agreement as a whole and as the same may, from time to time hereafter,
be amended, supplemented or modified. The words "herein," "hereby," "hereof,"
"hereto," "hereinabove" and "hereinbelow," and words of similar import, refer to
this Insurance Agreement as a whole and not to any particular paragraph, clause
or other subdivision hereof, unless otherwise specifically noted.

     "Accelerated Reserve Fund Event" means:

          (i) the occurrence of one or both of the following events:

          (a) as of the Determination Date with respect to any Collection
     Period, the average of the Delinquency Ratios for such Collection Period
     and the two Collection Periods immediately preceding such Collection Period
     is greater than the level specified for such month in the following table:

--------------------------------------------------------------------------------
Months after Closing                                           Delinquency Ratio
--------------------------------------------------------------------------------
1 to 6                                                         3.50%,
--------------------------------------------------------------------------------
7 to 12                                                        4.00%
--------------------------------------------------------------------------------
13 to 18                                                       4.50%
--------------------------------------------------------------------------------
19 to 24                                                       5.00%
--------------------------------------------------------------------------------
25 to 30                                                       5.50%
--------------------------------------------------------------------------------
31 to 36                                                       6.00%
--------------------------------------------------------------------------------
37 and thereafter                                              6.50%
--------------------------------------------------------------------------------

          provided, that an Accelerated Reserve Fund Event occurring under this
     clause (a) shall be deemed to have been cured if, as of the Determination
     Date with respect to each of any three (3) consecutive Collection Periods
     following the occurrence of an Accelerated Reserve Fund Event pursuant to
     this clause, the average of the Delinquency Ratios for such Collection
     Periods is less than the percentage specified above for the applicable
     Collection Period; or

          (b) as of the Determination Date in any month prior to and including
     the applicable month set forth in the table below, the Cumulative Net
     Charge-Off Ratio exceeds the level specified for such month in such table:

                                       2

<PAGE>

--------------------------------------------------------------------------------
                                                          Cumulative Net Charge-
     Month After Closing                                         Off Ratio
--------------------------------------------------------------------------------
Three                                                     Not Applicable
--------------------------------------------------------------------------------
Six                                                       3.125%
--------------------------------------------------------------------------------
Nine                                                      4.625%
--------------------------------------------------------------------------------
Twelve                                                    6.500%
--------------------------------------------------------------------------------
Fifteen                                                   8.250%
--------------------------------------------------------------------------------
Eighteen                                                  9.875%
--------------------------------------------------------------------------------
Twenty-One                                                11.125%
--------------------------------------------------------------------------------
Twenty-Four                                               12.125%
--------------------------------------------------------------------------------
Twenty-Seven                                              13.125%
--------------------------------------------------------------------------------
Thirty                                                    13.875%
--------------------------------------------------------------------------------
Thirty-Three and Thereafter                               14.500%
--------------------------------------------------------------------------------

     (ii) the occurrence or continuation of an Event of Default which has not
been waived or cured.

     "Business Day" means any day other than (a) a Saturday or a Sunday; or (b)
a day on which commercial banking or federal institutions in New York, New York,
Falls Church, Virginia, Plano, Texas, or in the city in which the principal
trust office of the Indenture Trustee or the principal office of the Note
Insurer, is located are authorized or obligated by law or executive order to
close.

     "Class A Notes" means the Capital One Auto Finance Trust 2002-C, Asset
Backed Notes, Series 2002-C, designated as Class A-1 Notes, Class A-2 Notes,
Class A-3-A Notes, Class A-3-B Notes and Class A-4 Notes issued in accordance
with the provisions of the Indenture.

     "COAF" means Capital One Auto Finance, Inc., a Texas corporation, and its
successors and assigns.

     "COAF Company" means each of the Servicer, the Transferor and the Seller.

     "Commission" means the Securities and Exchange Commission.

                                       3

<PAGE>

     "Cumulative Net Charge-Off Ratio" means, as of any Determination Date, the
ratio of (i) the Aggregate Receivable Balance of Receivables that became
Defaulted Receivables plus all the Cram Down Losses which occurred during the
period from the initial Cutoff Date through the end of the related Collection
Period reduced by the amount of Defaulted Receivable Recoveries received during
such period which are applied to principal of the Defaulted Receivables to (ii)
the sum of (A) the initial Aggregate Receivable Balance of the Initial
Receivables plus (B) the initial Aggregate Receivable Balance of the Subsequent
Receivables as of their respective Cutoff Dates.

     "Date of Issuance" means the date on which each Policy is issued as
specified therein.

     "Default" means any event which results, or which with the giving of notice
or the lapse of time or both would result, in an Event of Default.

     "Delinquency Ratio" means, as of a Determination Date, the ratio of (i) the
Aggregate Receivable Balance of Receivables that were Delinquent Receivables at
the end of the related Collection Period to (ii) the Aggregate Receivable
Balance of all Receivables as of the first day of such related Collection
Period.

     "Event of Default" means any event of default specified in Section 5.01 of
this Insurance Agreement.

     "Fee Letter" means the fee letter dated as of December 17, 2002, from the
Note Insurer to the Owner Trustee, the Servicer, and the Indenture Trustee.

     "Financial Statements" means, with respect to COAF, the balance sheets and
the statements of income, retained earnings and cash flows for the 12-month
period then ended and the notes thereto which have been provided to the Note
Insurer.

     "Fitch" means Fitch, Inc. and its successors and assigns.

     "Fiscal Agent" means the Fiscal Agent, if any, designated pursuant to the
terms the Note Policy or the Swap Policy, as applicable.

     "Funding Review" means the procedures specified in Section 2.02 of this
Insurance Agreement performed by the Review Firm (a) with respect to the Initial
Receivables to be included in the Receivables Pool within 14 Business Days
following the Closing Date and (b) within fourteen (14) Business Days following
the final Funding Date with respect to the Subsequent Receivables included in
the Receivables Pool as of each of the Funding Dates if a subsequent Funding
Review is requested by the Note Insurer.

     "Indemnification Agreement" means that certain Indemnification Agreement
dated as of December 6, 2002, by and among the Note Insurer, Capital One Auto
Finance, Inc. and Capital One Auto Receivables, LLC, as Issuer Parties and Banc
of America Securities LLC, and J.P. Morgan Securities Inc. as Representatives of
the several Underwriters (as defined therein).

     "Indenture" means that certain Indenture dated as of December 17, 2002,
between the Owner Trustee and the Indenture Trustee.

                                       4

<PAGE>

     "Insurance Agreement Event of Default" means any of the following:

          (a) any failure (i) to observe or perform any covenant or obligation
     of the Owner Trustee, the Transferor, the Seller or the Servicer set forth
     herein, or in the Indenture, the Servicing Agreement, the Contribution
     Agreement or the Transfer and Assignment Agreement which has not been cured
     within thirty (30) days from the date of receipt by the Owner Trustee, the
     Transferor, the Seller or the Servicer, as the case may be, of written
     notice from the Indenture Trustee or the Note Insurer of such breach or
     default, or (ii) of any Person to deposit into the Collection Account, the
     Revenue Fund or the Reserve Fund all amounts required to be deposited
     therein by the required deposit date;

          (b) any representation, warranty or statement of the Indenture
     Trustee, the Servicer, the Owner Trustee, the Transferor or the Seller
     (other than representations and warranties under Section 3.02(b) of the
     Transfer and Assignment Agreement and the Contribution Agreement) contained
     herein or in the Indenture or in the Servicing Agreement, the Contribution
     Agreement, the Transfer and Assignment Agreement or in any report, document
     or certificate delivered pursuant to the foregoing agreements shall prove
     to be incorrect in any material respect as of the time when the same shall
     have been made and, within thirty (30) days after written notice thereof
     shall have been given to the Trustee and the defaulting party (if not the
     Indenture Trustee) by the Servicer, the Note Insurer, the Indenture Trustee
     or by Noteholders constituting Noteholder Approval, the circumstances or
     condition in respect of which such representation, warranty or statement
     was incorrect shall not have been eliminated or otherwise cured or waived
     by the Note Insurer;

          (c) the cessation of a valid perfected first priority security
     interest in the Receivables or the Accounts in favor of the Indenture
     Trustee which is not cured within three (3) days of receipt of notice
     thereof;

          (d) a payment default by the Owner Trustee, the Servicer or any
     Affiliate of the Servicer in any agreement to which any such Person is a
     party and under which any Indebtedness owing by such Person having a
     principal amount greater than $50,000,000 was created or is governed;

          (e) as of the Determination Date with respect to each Collection
     Period, the three month average of the Delinquency Ratios for such
     Collection Period and the two Collection Periods immediately preceding such
     Collection Period is greater than the level specified for such month in
     such table:

     ---------------------------------------------------------------------------
     Months after Closing                                      Delinquency Ratio
     ---------------------------------------------------------------------------
     1 to 6                                                    4.50%,
     ---------------------------------------------------------------------------
     7 to 12                                                   5.00%
     ---------------------------------------------------------------------------
     13 to 18                                                  5.50%
     ---------------------------------------------------------------------------

                                       5

<PAGE>

     ---------------------------------------------------------------------------
     19 to 24                                                  6.00%
     ---------------------------------------------------------------------------
     25 to 30                                                  6.50%
     ---------------------------------------------------------------------------
     31 to 36                                                  7.00%
     ---------------------------------------------------------------------------
     37 and thereafter                                         7.50%
     ---------------------------------------------------------------------------

          provided, that a Insurance Agreement Event of Default occurring under
     this clause (e) shall be deemed to have been cured if, as of the
     Determination Date with respect to each of any three (3) consecutive
     Collection Periods following the occurrence of a Insurance Agreement Event
     of Default pursuant to this clause (e), the average of the Delinquency
     Ratios for such Collection Periods is less than the percentage above for
     the applicable Collection Period;

          (f) a draw is made on the Note Policy;

          (g)(i) a final judgment for the payment of money in excess of
     $50,000,000 shall have been rendered against the Transferor or any
     Affiliate of the Transferor by a court of competent jurisdiction and the
     Transferor or such Affiliate shall not have either: (1) discharged or
     provided for the discharge of such judgment in accordance with its terms,
     or (2) perfected a timely appeal of such judgment and caused the execution
     thereof to be stayed (by supersedeas or otherwise) during the pendency of
     such appeal or (ii) the Transferor or such Affiliate shall have made
     payments of amounts in excess of $50,000,000 in settlement of any
     litigation;

          (h) as of the Determination Date in any month prior to and including
     the applicable month set forth in the table below, the Cumulative Net
     Charge-Off Ratio exceeds the level specified for such month in such table:

     ---------------------------------------------------------------------------
          Months                                                 Cumulative Net
      After Closing                                             Charge-Off Ratio
     ---------------------------------------------------------------------------
            6                                                   Not Applicable
     ---------------------------------------------------------------------------
            9                                                   5.250%
     ---------------------------------------------------------------------------
            12                                                  7.375%
     ---------------------------------------------------------------------------
            15                                                  9.500%
     ---------------------------------------------------------------------------
            18                                                  11.500%
     ---------------------------------------------------------------------------
            21                                                  12.875%
     ---------------------------------------------------------------------------

                                       6

<PAGE>

     ---------------------------------------------------------------------------
           Months                                                Cumulative Net
       After Closing                                            Charge-Off Ratio
     ---------------------------------------------------------------------------
             24                                                 13.625%
     ---------------------------------------------------------------------------
             27                                                 14.500%
     ---------------------------------------------------------------------------
             30                                                 15.250%
     ---------------------------------------------------------------------------
     33 and Thereafter                                          16.000%
     ---------------------------------------------------------------------------

          (i) except as permitted by the Servicing Agreement, any assignment by
     the Servicer of its rights and obligations under the Servicing Agreement or
     any attempt to make such an assignment;

          (j) failure to make any payment with respect to the Class A Notes
     pursuant to Section 5.05(c) of the Indenture, which continues unpaid for a
     period of three (3) Business Days;

          (k) Capital One Financial Corporation or one of its subsidiaries shall
     cease to own at least 51% of the voting stock of COAF without the prior
     written consent of the Note Insurer;

          (l) the occurrence of a Servicer Event of Default or Event of Default
     under the Indenture; or

          (m) any Event of Default or Termination Event (as defined in the Swap
     Agreement) occurs under the Swap Agreement.

     "Investment Company Act" means the Investment Company Act of 1940,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended.

     "Late Payment Rate" means the rate of interest as it is publicly announced
by Citibank, N.A. at its principal office in New York, New York as its prime
rate (any change in such prime rate of interest to be effective on the date such
change is announced by Citibank, N.A.) plus 3%. The Late Payment Rate shall be
computed on the basis of a year of 365 days calculating the actual number of
days elapsed. In no event shall the Late Payment Rate exceed the maximum rate
permissible under any applicable law limiting interest rates.

     "Material Adverse Change" means, in respect of any Person, a material
adverse change in (a) the business, financial condition, results of operations
or properties of such Person or (b) the ability of such Person to perform its
obligations under any of the Transaction Documents.

     "Moody's" means Moody's Investors Service, Inc., a Delaware corporation,
and any successor thereto, and, if such corporation shall for any reason no
longer perform the functions

                                       7

<PAGE>

of a securities rating agency, "Moody's" shall be deemed to refer to any other
nationally recognized rating agency designated by the Note Insurer.

     "Notes" means the $800,000,000 Capital One Auto Finance Trust 2002-C, Asset
Backed Notes, Series 2002-C, Class A-1 Notes, Class A-2 Notes, Class A-3-A
Notes, Class A-3-B Notes and Class A-4 Notes.

     "Owners" means registered holders of Class A Notes.

     "Person" means an individual, joint stock company, trust, unincorporated
association, joint venture, corporation, limited liability company, business or
owner trust, partnership or other organization or entity (whether governmental
or private).

     "Premium" means the premium payable in accordance with Section 3.02 of this
Insurance Agreement.

     "Prospectus" means, collectively, (i) the Preliminary Prospectus Supplement
dated December 2, 2002 to the Prospectus dated December 2, 2002 and (ii) the
Final Prospectus Supplement dated December 6, 2002 to the Prospectus dated
December 2, 2002, each relating to the sale of the Class A Notes on the Closing
Date.

     "Representative" means Banc of America Securities LLC, as representative
for the Underwriters.

     "Review Firm" means a firm of independent certified public accountants or
other third-party acceptable to the Note Insurer and engaged by the Seller to
perform the Funding Reviews.

     "Securities Act" means the Securities Act of 1933, including, unless the
context otherwise requires, the rules and regulations thereunder, as amended
from time to time.

     "Securities Exchange Act" means the Securities Exchange Act of 1934,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended from time to time.

     "S&P" means Standard & Poor's Ratings Services, and any successor thereto,
and, if such corporation shall for any reason no longer perform the functions of
a securities rating agency, "S&P" shall be deemed to refer to any other
nationally recognized rating agency designated by the Note Insurer.

     "Swap Agreement" means the ISDA Master Agreement dated as of December 6,
2002 between the Owner Trustee and the Swap Provider, the Schedule thereto and
the Confirmation bearing Reference Nos. 7326796 and 7326797 dated December 6,
2002.

     "Swap Policy" means the Interest Rate Swap Insurance Policy No. 39934(2)
issued by MBIA, which guarantees certain payments due under the Swap Agreement.

     "Swap Provider" means Bank of America, N.A. and its permitted successors
and assigns.

                                       8

<PAGE>

     "Term of the Insurance Agreement" shall be determined as provided in
Section 4.01 of this Insurance Agreement.

     "Transaction" means the transactions contemplated by the Transaction
Documents including the transactions described in the Prospectus.

     "Transaction Documents" means this Insurance Agreement, the Indemnification
Agreement, the Prospectus, the Indenture, the Swap Agreement, the Transfer and
Assignment Agreement, the Contribution Agreement, the Servicing Agreement, the
Limited Guaranty, the Underwriting Agreement, the Trust Agreement, and the
Notes.

     "Underwriting Agreement" has the meaning assigned thereto in the Indenture.

                                   ARTICLE II

                    REPRESENTATIONS, WARRANTIES AND COVENANTS

     Section 2.01. Representation and Warranties of the COAF Companies. As of
the date hereof and as of the Date of Issuance, each COAF Company represents,
warrants and covenants, each as to those matters relating to itself, as follows:

          (a) Due Organization and Qualification. Each COAF Company is either a
     corporation or a limited liability company and is duly organized, validly
     existing and in good standing under the laws of its respective
     jurisdiction. Each COAF Company is duly qualified to do business, is in
     good standing and has obtained all necessary licenses, permits, charters,
     registrations and approvals (together, "approvals") necessary for the
     conduct of its business as currently conducted and as described in the
     Prospectus and the performance of its obligations under the Transaction
     Documents, in each jurisdiction in which the failure to be so qualified or
     to obtain such approvals would render any Transaction Document
     unenforceable in any respect or would have a material adverse effect upon
     the Transaction.

          (b) Power and Authority. Each COAF Company has all necessary corporate
     or other power and authority to conduct its business as currently
     conducted, and, as described in the Prospectus and to execute, deliver and
     perform its obligations under the Transaction Documents and to consummate
     the Transaction.

          (c) Due Authorization. The execution, delivery and performance of the
     Transaction Documents by each COAF Company has been duly authorized by all
     necessary corporate and other action and do not require any additional
     approvals or consents, or other action by or any notice to or filing with
     any Person, including, without limitation, any governmental entity or any
     partners or stockholders, which have not previously been obtained or given
     by such COAF Company.

          (d) Noncontravention. Neither the execution and delivery of the
     Transaction Documents by any COAF Company, the consummation of the
     transactions contemplated thereby nor the satisfaction of the terms and
     conditions of the Transaction Documents:

                                       9

<PAGE>

               (i) conflicts with or results in any breach or violation of any
          provision of the certificate of incorporation or bylaws or other
          organizational document of any COAF Company or any material law, rule,
          regulation, order, writ, judgment, injunction, decree, determination
          or award currently in effect having applicability to any COAF Company
          or any of their material properties, including regulations issued by
          an administrative agency or other governmental authority having
          supervisory powers over any COAF Company;

               (ii) constitutes a default by any COAF Company under or a breach
          of any provision of any material loan agreement, mortgage, indenture
          or other agreement or instrument to which any COAF Company is a party
          or by which any of their respective properties, which are individually
          or in the aggregate material to any COAF Company, is or may be bound
          or affected; or

               (iii) results in or requires the creation of any lien upon or in
          respect of any assets of any COAF Company (other than the liens
          created under the Transaction Documents).

          (e) Legal Proceedings. There is no action, proceeding or investigation
     by or before any court, governmental or administrative agency or arbitrator
     against or affecting any COAF Company or any of its or their subsidiaries,
     or any properties or rights of any COAF Company or any of its or their
     subsidiaries, pending or, to any COAF Company's knowledge after reasonable
     inquiry, threatened, which, in any case, could reasonably be expected to
     result in a Material Adverse Change with respect to any COAF Company.

          (f) Valid and Binding Obligations. The Notes, when executed,
     authenticated and issued in accordance with the Indenture and the
     Transaction Documents (other than the Notes), when executed and delivered
     by each COAF Company party thereto, will constitute the legal, valid and
     binding obligations of the Owner Trustee and the applicable COAF Company or
     COAF Companies, as applicable, enforceable in accordance with their
     respective terms, except as such enforceability may be limited by
     bankruptcy, insolvency, reorganization, moratorium or other similar laws
     affecting creditors' rights generally and general equitable principles and
     public policy considerations as to rights of indemnification for violations
     of federal securities laws.

          (g) Financial Statements. The Servicer and the Transferor hereby
     represent and warrant that (i) the Financial Statements of Capital One
     Financial Corporation, copies of which have been furnished to the Note
     Insurer, (A) are, as of the dates and for the periods referred to therein,
     complete and correct in all material respects, (B) present fairly the
     financial condition and results of operations of COAF as of the dates and
     for the periods indicated and (C) have been prepared in accordance with
     generally accepted accounting principles consistently applied, except as
     noted therein (subject as to interim statements to normal year-end
     adjustments); (ii) since the date of the most recent Financial Statements,
     there has been no Material Adverse Change in respect of COAF; and (iii)
     except as disclosed in the Financial Statements, COAF is not subject to any
     contingent liabilities or commitments that, individually or in the
     aggregate, have a material possibility of causing a Material Adverse Change
     in respect of COAF.

                                       10

<PAGE>

          (h) Compliance With Law, Etc. No practice, procedure or policy
     employed, or proposed to be employed, by any COAF Company in the conduct of
     its business violates any law, regulation, judgment, agreement, order or
     decree applicable to any of them that, if enforced, could reasonably be
     expected to result in a Material Adverse Change with respect to any COAF
     Company.

          (i) Taxes. Each COAF Company and each COAF Company's parent company or
     companies have filed prior to the date hereof all federal and state tax
     returns that are required to be filed and paid all taxes, including any
     assessments received by them that are not being contested in good faith, to
     the extent that such taxes have become due, except for any failures to file
     or pay that, individually or in the aggregate, would not result in a
     Material Adverse Change with respect to any COAF Company.

          (j) Accuracy of Information. Neither the Transaction Documents nor
     other information relating to the Receivables or related assets, the
     operations of any COAF Company (including servicing or origination of
     loans) or the financial condition of any COAF Company (collectively, the
     "Documents"), as amended, supplemented or superseded, furnished to the Note
     Insurer by any COAF Company contain any statement of a material fact by any
     COAF Company which was untrue or misleading in any material adverse respect
     when made. No COAF Company has any knowledge of circumstances that could
     reasonably be expected to cause a Material Adverse Change with respect to
     any COAF Company. Since the furnishing of the Documents, there has been no
     change nor any development or event involving a prospective change known to
     any COAF Company that would render any of the Documents untrue or
     misleading in a material respect.

          (k) Compliance With Securities Laws. The offer and sale of the Notes
     comply in all material respects with all requirements of law, including all
     registration requirements of applicable securities laws. Without limitation
     of the foregoing, the Prospectus does not contain any untrue statement of a
     material fact and does not omit to state a material fact necessary to make
     the statements made therein, in light of the circumstances under which they
     were made, not misleading; provided, however, that no representation is
     made with respect to the information in the Prospectus set forth under the
     heading "THE NOTE GUARANTY INSURANCE POLICY AND THE NOTE INSURER" or the
     consolidated financial statements of the Note Insurer incorporated by
     reference in the Prospectus. Neither the offer nor the sale of the Notes
     has been or will be in violation of the Securities Act or any other federal
     or state securities laws. The Owner Trustee is not required to be
     registered as an "investment company" under the Investment Company Act.

          (l) Transaction Documents. Each of the representations and warranties
     of each COAF Company contained in the Transaction Documents is true and
     correct in all material respects, and each COAF Company hereby makes each
     such representation and warranty to, and for the benefit of, the Note
     Insurer as if the same were set forth in full herein, provided that the
     remedy for any breach of this paragraph shall be limited to the remedies
     specified in the related Transaction Document.

                                       11

<PAGE>

          (m) Solvency. Each COAF Company is solvent and will not be rendered
     insolvent by the Transaction and, after giving effect to the Transaction,
     no COAF Company will be left with an unreasonably small amount of capital
     with which to engage in its business, nor does any COAF Company intend to
     incur, or believe that it has incurred, debts beyond its ability to pay as
     they mature. No COAF Company contemplates the commencement of insolvency,
     bankruptcy, liquidation or consolidation proceedings or the appointment of
     a receiver, liquidator, conservator, trustee or similar official in respect
     of any COAF Company or any of their assets.

          (n) Organizational Documents. Each COAF Company is in full compliance
     with its organizational documents, including without limitation and as
     applicable, each COAF Company's articles of incorporation, bylaws,
     certificate of formation or limited liability company agreement.

          (o) Corporate Organization.

               (i) COAF is a corporation organized under the laws of the State
          of Texas. "Capital One Auto Finance, Inc." is the correct legal name
          of COAF indicated on the public records of COAF's jurisdiction of
          organization which shows COAF to be organized.

               (ii) The Seller is a limited liability company organized under
          the laws of the State of Delaware. "Capital One Auto Receivables, LLC"
          is the correct legal name of the Seller indicated on the public
          records of the Seller's jurisdiction of organization which shows the
          Seller to be organized.

     Section 2.02. Affirmative Covenants of the COAF Companies. The COAF
Companies hereby agree that during the Term of the Insurance Agreement, unless
the Note Insurer shall otherwise expressly consent in writing:

          (a) Compliance With Agreements and Applicable Laws. The COAF Companies
     shall not be in default under the Transaction Documents and shall comply
     with all material requirements of any law, rule or regulation applicable to
     each such party. No COAF Company shall agree to any amendment to or
     modification of the terms of any Transaction Documents or its respective
     organizational documents (including without limitation and as applicable
     its articles of incorporation, partnership agreement, bylaws, certificate
     of formation and limited liability company agreement) unless the Note
     Insurer shall have otherwise consented.

          (b) Corporate Existence. Each COAF Company, its successors and
     assigns, shall maintain its corporate or other existence and shall at all
     times continue to be duly organized under the laws of its respective
     jurisdiction of incorporation or formation and duly qualified and duly
     authorized (as described in subsections 2.01(a), (b) and (c) hereof) and
     shall conduct its business in accordance with the terms of its certificate
     of incorporation and bylaws or other formation documents.

          (c) The Servicer To Provide Financial Statements; Accountants'
     Reports; Other Information. The Servicer shall keep or cause to be kept in
     reasonable detail

                                       12

<PAGE>

     books and records of account of COAF's, and its consolidated subsidiaries',
     assets and business, including, but not limited to, books and records
     relating to the Transaction. The Servicer shall furnish or cause to be
     furnished to the Note Insurer:

               (i) Financial Statements. All reports, Financial Statements,
          Officer's certificates and reviews required to be furnished under
          Section 2.11 of the Servicing Agreement and Section 5.14 of the
          Indenture, including quarterly unaudited financial statements of
          Capital One Financial Corporation and its consolidated subsidiaries
          and audited annual financial statements of Capital One Financial
          Corporation and its consolidated subsidiaries.

               (ii) Initial and Continuing Reports. On or before the Closing
          Date, the Servicer will provide the Note Insurer a copy of the
          electronic file or other such medium as may be acceptable to the Note
          Issuer to be delivered to the Indenture Trustee setting forth, as to
          each Receivable, the information required on the Schedule of
          Receivables. Thereafter, the Servicer shall deliver to the Indenture
          Trustee and direct the Indenture Trustee to deliver to the Note
          Insurer the report required by Section 2.02(d) of the Servicing
          Agreement.

               (iii) Certain Information. Upon the reasonable request of the
          Note Insurer, the Servicer shall promptly provide copies of any
          requested proxy statements, financial statements, reports and
          registration statements which any COAF Company files with, or delivers
          to, the Commission or any national securities exchange.

               (iv) Other Information. Promptly upon receipt thereof, copies of
          all schedules, financial statements or other similar reports delivered
          to or by the Servicer pursuant to the terms of the Servicing Agreement
          and, promptly upon request, such other data or reports relating to the
          Transaction as the Note Insurer may reasonably request.

          The Note Insurer agrees that it and its agents, accountants and
     attorneys shall keep confidential all financial statements, reports and
     other information delivered by the Servicer pursuant to this subsection
     2.02(c) to the extent provided in subsection 2.02(e) hereof.

          (d) Access to Records; Discussions With Officers and Accountants. On
     an annual basis, or upon the occurrence of a Material Adverse Change, each
     COAF Company shall, upon the reasonable request of the Note Insurer, permit
     the Note Insurer or its authorized agents:

               (i) to inspect its books and records as they may relate to the
          Class A Notes, the obligations of such party under the Transaction
          Documents, and the Transaction;

               (ii) to discuss the affairs, finances and accounts of each COAF
          Company with the chief operating officer and the chief financial
          officer of such COAF Company, as the case may be; and

                                       13

<PAGE>

               (iii) with any COAF Company's consent, which consent shall not be
          unreasonably withheld, to discuss the affairs, finances and accounts
          of such COAF Company with such company's independent accountants,
          provided that an officer of such COAF Company shall have the right to
          be present during such discussions.

          Such inspections and discussions shall be conducted during normal
     business hours and shall not unreasonably disrupt the business of such COAF
     Company. The books and records of each COAF Company will be maintained at
     the address of such COAF Company designated herein for receipt of notices,
     unless the Servicer shall otherwise advise the parties hereto in writing.

          (e) Confidentiality. The Note Insurer agrees that it and its
     shareholders, directors, agents, accountants and attorneys shall keep
     confidential any matter of which it becomes aware through such inspections
     or discussions (unless readily available from public sources), except as
     may be otherwise required by regulation, law or court order or requested by
     appropriate governmental authorities or as necessary to preserve its rights
     or security under or to enforce the Transaction Documents, provided that
     the foregoing shall not limit the right of the Note Insurer to make such
     information available to its regulators, securities rating agencies,
     reinsurers, credit and liquidity providers, counsel and accountants. If the
     Note Insurer is requested or required (by oral questions, interrogatories,
     requests for information or documents subpoena, civil investigative demand
     or similar process) to disclose any information of which it becomes aware
     through such inspections or discussions, the Note Insurer will promptly
     notify the Transferor or the Servicer of such request(s) so that the
     Transferor or the Servicer may seek an appropriate protective order and/or
     waive the Note Insurer's compliance with the provisions of this Insurance
     Agreement. If, in the absence of a protective order or the receipt of a
     waiver hereunder, the Note Insurer is, nonetheless, in the opinion of its
     counsel, compelled to disclose such information to any tribunal or else
     stand liable for contempt or suffer other censure or significant penalty,
     the Note Insurer may disclose such information to such tribunal that the
     Note Insurer is compelled to disclose, provided that a copy of all
     information disclosed is provided to the Transferor or the Servicer, as the
     case may be, promptly upon such disclosure.

          (f) Notice of Material Events. Each COAF Company shall be obligated
     (which obligation shall be satisfied as to each if performed by any of
     them) promptly to inform the Note Insurer in writing of the occurrence of
     any of the following to the extent any of the following relate to it:

               (i) the submission of any claim or the initiation or threat of
          any legal process, litigation or administrative or judicial
          investigation, or rule-making or disciplinary proceeding by or against
          any COAF Company that (A) could be required to be disclosed to the
          Commission or to any COAF Company's shareholders or (B) could result
          in a Material Adverse Change with respect to any COAF Company, or the
          promulgation of any proceeding or any proposed or final rule which
          would result in a Material Adverse Change with respect to any COAF
          Company;

                                       14

<PAGE>

               (ii) any change in the location of any COAF Company's principal
          offices, jurisdiction of organization, legal name as indicated on the
          public records of any COAF Company's jurisdiction of organization
          which shows any COAF Company to be organized, or any change in the
          location of any COAF Company's books and records;

               (iii) the occurrence of any Default or Event of Default or of any
          Material Adverse Change;

               (iv) the commencement of any proceedings by or against any COAF
          Company under any applicable bankruptcy, reorganization, liquidation,
          rehabilitation, insolvency or other similar law now or hereafter in
          effect or of any proceeding in which a receiver, liquidator,
          conservator, trustee or similar official shall have been, or may be,
          appointed or requested for any COAF Company or any of its assets; or

               (v) the receipt of notice that (A) any COAF Company is being
          placed under regulatory supervision, (B) any license, permit, charter,
          registration or approval necessary for the conduct of any COAF
          Company's business is to be, or may be suspended or revoked, or (C)
          any COAF Company is to cease and desist any practice, procedure or
          policy employed by any COAF Company in the conduct of its business,
          and such cessation may result in a Material Adverse Change with
          respect to any COAF Company.

          (g) Financing Statements and Further Assurances. The Servicer will
     cause to be filed all necessary financing statements or other instruments,
     and any amendments or continuation statements relating thereto, necessary
     to be kept and filed in such manner and in such places as may be required
     by law to preserve and protect fully the interest of the Indenture Trustee
     in the Trust Property. Each COAF Company shall, upon the request of the
     Note Insurer, from time to time, execute, acknowledge and deliver, or cause
     to be executed, acknowledged and delivered, within 10 days of such request,
     such amendments hereto and such further instruments and take such further
     action as may be reasonably necessary to effectuate the intention,
     performance and provisions of the Transaction Documents. In addition, each
     of the COAF Companies agrees to cooperate with S&P, Fitch, and Moody's in
     connection with any review of the Transaction that may be undertaken by
     S&P, Fitch, and Moody's after the date hereof.

          (h) Maintenance of Licenses. Each COAF Company or any successors
     thereof shall maintain all licenses, permits, charters and registrations
     which are material to the conduct of its business.

          (i) Redemption of Class A Notes. The Servicer shall instruct the
     Indenture Trustee, upon redemption of the Class A Notes pursuant to the
     Transaction Documents, to furnish to the Note Insurer a notice of such
     redemption and, upon a redemption or other payment of all of the Class A
     Notes to surrender the Policies to the Note Insurer for cancellation.

                                       15

<PAGE>

          (j) Disclosure Document. Each Prospectus delivered with respect to the
     Notes shall clearly disclose that the Note Policy is not covered by the
     property/casualty insurance security fund specified in Article 76 of the
     New York Insurance Law.

          (k) Third-party Beneficiary. Each COAF Company agrees that the Note
     Insurer shall have all rights of a third-party beneficiary in respect of
     each Transaction Document (other than the Underwriting Agreement) and
     hereby incorporates and restates their representations, warranties and
     covenants as set forth therein for the benefit of the Note Insurer.

          (l) Amendments. The Servicer will provide the Note Insurer with
     written notice of any change or amendment to any Transaction Document as
     currently in effect.

          (m) Maintenance of Trust Property. On or before each November 1,
     beginning in 2003, so long as any of the Notes are outstanding, the
     Servicer shall furnish to the Note Insurer and the Indenture Trustee an
     officers' certificate either stating that such action has been taken with
     respect to the recording, filing, rerecording and refiling of any financing
     statements and continuation statements as is necessary to maintain the
     interest of the Indenture Trustee created by the Indenture with respect to
     the Trust Property and reciting the details of such action or stating that
     no such action is necessary to maintain such interests. Such officers'
     certificate shall also describe the recording, filing, rerecording and
     refiling of any financing statements and continuation statements that will
     be required to maintain the interest of the Indenture Trustee in the Trust
     Property until the date such next officers' certificate is due. The
     Servicer will use its best efforts to cause any necessary recordings or
     filings to be made with respect to the Trust Property.

          (n) Closing Documents. The Servicer shall provide or cause to be
     provided to the Note Insurer an executed original copy of each document
     executed in connection with the Transaction within 30 days after the date
     of closing.

          (o) Preference Payments. With respect to any Preference Amount (as
     defined in the Policies), the Servicer shall provide to the Note Insurer
     upon the request of the Note Insurer:

               (i) a certified copy of the final nonappealable order of a court
          having competent jurisdiction ordering the recovery by a trustee in
          bankruptcy as voidable preference amounts included in previous
          payments to any Owner pursuant to the United States Bankruptcy Code;

               (ii) an opinion of counsel satisfactory to the Note Insurer, and
          upon which the Note Insurer shall be entitled to rely, stating that
          such order is final and is not subject to appeal;

               (iii) an assignment in such form as reasonably required by the
          Note Insurer, irrevocably assigning to the Note Insurer all rights and
          claims of each COAF Company, the Indenture Trustee and any Class A
          Noteholder relating to or arising under the Transaction Documents
          against the debtor which made such preference payment or otherwise
          with respect to such preference amount; and

                                       16

<PAGE>

               (iv) appropriate instruments to effect (when executed by the
          affected party) the appointment of the Note Insurer as agent for the
          Indenture Trustee and any Class A Noteholder in any legal proceeding
          relating to such preference payment being in a form satisfactory to
          the Note Insurer.

          (p) Corporate Formalities. The Seller shall have annual shareholder
     meetings or meetings of members, as applicable, and at least annual board
     of directors meetings as applicable, provided, however, that the members or
     the board of directors may act by unanimous written consent in lieu of such
     meetings. The Seller shall deliver minutes of such annual meetings, or
     written records of any such actions taken by unanimous written consent, to
     the Note Insurer upon the Note Insurer's request. The Seller shall observe
     all corporate or other formalities necessary to preserve its status as a
     separate legal entity. The Seller shall prepare income and franchise tax
     returns as required by law and shall deliver copies of such tax returns to
     the Note Insurer upon the Note Insurer's request.

          (q) Funding Review.

               (i) The Seller shall have a Funding Review 14 Business Days after
          the Closing Date. If a subsequent Funding Review is requested by the
          Note Insurer following the final Funding Date, the Seller shall have
          the Funding Review performed with respect to the Subsequent
          Receivables acquired on each Funding Date, and the results thereof
          provided to the Note Insurer, the Seller, the Trustee, the Owner
          Trustee and the Rating Agencies within twenty-one (21) Business Days
          following the request therefor.

               (ii) The Seller will engage the Review Firm to conduct the
          Funding Reviews. In each Funding Review, the Review Firm will:

                    (A) compare the Receivable files with respect to a random
               sample of at least 150 of such Receivables in the case of the
               Funding Review conducted prior to the Closing Date, and at least
               100 of such Receivables in the case of the Funding Review
               conducted following the final Funding Date if a subsequent
               Funding Review is requested by the Note Insurer, to the
               information in the electronic data tape representing such
               Receivables, and shall check to see that items such as original
               term, first and last payment date, Receivable Balance, Scheduled
               Payment, Amount Financed, vehicle identification number, interest
               rate, etc., are the same on the tape as in the files;

                    (B) review the Receivable file with respect to each
               Receivable to verify the existence of (i) a copy of an original
               executed retail installment contract and security agreement
               relating to such Receivable and (ii) a copy of an original
               Certificate of Title for the related Financed Vehicle or other
               evidence of lien issued by the applicable Department of Motor
               Vehicles ("DMV"), indicating the Seller's (or, in the case of a
               Referral Receivable, the Referral Originator's) position as
               lienholder (or,

                                       17

<PAGE>

               in the case of a recently originated loan for which the Seller
               has not yet received a definitive Certificate of Title or other
               evidence of lien from the DMV, a copy of properly completed and
               signed application to such DMV requesting the issuance of a
               Certificate of Title or other evidence of lien noting the
               Seller's (or, in the case of a Referral Receivable, the Referral
               Originator's) position as lienholder);

                    (C) review a randomly selected sample of 150 Receivables in
               the case of the Funding Review conducted prior to the Closing
               Date, and of 100 Receivables in the case of the Funding Review
               conducted following the final Funding Date if a subsequent
               Funding Review is requested by the Note Insurer, to verify that
               the Seller's or the Seller's subservicer's records reflect that a
               conversation with the related Obligor took place to confirm with
               such Obligor the terms of the Receivable; and

                    (D) check at least 150 of the Receivable files in the case
               of the Funding Review conducted prior to the Closing Date, and at
               least 100 of such Receivables files in the case of the Funding
               Review conducted following the final Funding Date if a subsequent
               Funding Review is requested by the Note Insurer, for compliance
               with certain of COAF's origination and underwriting guidelines,
               as specified in the Credit Policy, including the following: (i)
               the Amount Financed; (ii) the down payment; (iii) the maximum
               term of the Receivable; (iv) the minimum monthly payment; (v) the
               minimum income; (vi) the maximum payment to income and debt ratio
               (if applicable pursuant to the Credit Policy and COAF's
               underwriting guidelines); and (vii) existence of acceptable proof
               of residence, employment and income.

               (iii) The Seller shall instruct the Review Firm to deliver copies
          of the results of each Funding Review to the Note Insurer, the Seller,
          the Owner Trustee, the Class B Noteholder, the Representative and the
          Rating Agencies within 21 Business Days following the Closing Date,
          with respect to the first Funding Review, and within 21 Business Days
          following the Note Insurer's request for a Funding Review, with
          respect to the second Funding Review.

     Section 2.03. Negative Covenants of the COAF Companies. Each COAF Company
hereby agrees that during the Term of the Insurance Agreement, unless the Note
Insurer shall otherwise expressly consent in writing:

          (a) Impairment of Rights. No COAF Company shall take any action, or
     fail to take any action, if such action or failure to take action may
     result in a material adverse change as described in clause (b) of the
     definition of Material Adverse Change with respect to any COAF Company, or
     may interfere with the enforcement of any rights of the Note Insurer under
     or with respect to the Transaction Documents. Each COAF Company shall give
     the Note Insurer written notice of any such action or failure to act on the
     earlier of (i) the date upon which any publicly available filing or release
     is made with respect to such action or failure to act or (ii) promptly
     prior to the date of consummation

                                       18

<PAGE>

     of such action or failure to act. Each COAF Company shall furnish to the
     Note Insurer all information requested by it that is reasonably necessary
     to determine compliance with this paragraph.

          (b) Adverse Selection Procedure. No COAF Company will use any adverse
     selection procedure in selecting Receivables to be transferred to the Owner
     Trustee.

          (c) Waiver, Amendments, Etc. Except in accordance with the Transaction
     Documents, no COAF Company shall waive, modify or amend, or consent to any
     waiver, modification or amendment of, any of the terms, provisions or
     conditions of the Transaction Documents without the consent of the Note
     Insurer.

          (d) Receivables; Policies. Except as otherwise permitted in the
     Servicing Agreement, none of the Servicer or any COAF Company shall alter
     or amend any Receivable, its credit policies, its collection policies or
     its charge-off policies in a manner that materially adversely affects the
     Note Insurer unless the Note Insurer shall have previously given its
     consent, which consent shall not be unreasonably withheld.

          (e) Transaction Documents. No COAF Company will at any time in the
     future deny that the Transaction Documents constitute the legal, valid and
     binding obligations of each COAF Company, as applicable.

     Section 2.04. Representation and Covenants of Indenture Trustee.

          (a) Representations and Warranties. As of the Date of Issuance, each
     of the representations and warranties of the Indenture Trustee set forth in
     the Transaction Documents are true and correct in all material respects,
     and the Indenture Trustee makes each such representation and warranty to,
     and for the benefit of, the Note Insurer as if the same were set forth in
     full herein.

          (b) Compliance and Amendments. The Indenture Trustee shall comply in
     all material respects with the terms and conditions of the Transaction
     Documents to which it is a party, and the Indenture Trustee shall not agree
     to any amendment to or modification of the terms of any of the Transaction
     Documents to which both the Indenture Trustee and the Note Insurer are
     parties unless the Note Insurer shall otherwise consent, provided that such
     consent shall not be required if a Note Insurer Default has occurred and is
     continuing.

     Section 2.05. Representations, Warranties and Covenants of the Owner
Trustee. The Owner Trustee hereby represents and warrants as follows:

          (a) Representations and Warranties. As of the Date of Issuance, each
     of the representations and warranties of the Owner Trustee set forth in the
     Transaction Documents is true and correct in all material respects and the
     Owner Trustee makes each such representation and warranty to, and for the
     benefit of, the Note Insurer as if the same were set forth in full herein.

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<PAGE>

          (b) Compliance and Amendments. The Owner Trustee shall comply in all
     material respects with the terms and conditions of the Transaction
     Documents it is a party and, except in accordance with the Transaction
     Documents, the Owner Trustee shall not agree to any amendment to or
     modification of the terms of any of the Transaction Documents to which it
     is a party unless the Note Insurer shall otherwise give its prior written
     consent.

          (c) Principal Place of Business. The principal place of business of
     the Owner Trustee is located in Wilmington, Delaware.

          (d) Covenant to Pay Interest. On each Payment Date, the Owner Trustee
     shall pay or cause to be paid to the applicable Class of Class A
     Noteholders, interest in an amount equal to the Class A-1 Note Interest,
     Class A-2 Note Interest, Class A-3-A Note Interest, Class A-3-B Note
     Interest and Class A-4 Note Interest, as the case may be.

                                  ARTICLE III

                           THE POLICIES; REIMBURSEMENT

     Section 3.01. Issuance of the Policies. The Note Insurer agrees to issue
the Policies on the Closing Date subject to satisfaction of the conditions
precedent set forth below:

          (a) Payment of Initial Premium and Expenses. The Note Insurer shall
     have been paid, by the Servicer, that portion of a nonrefundable Premium
     payable on the Date of Issuance and the Servicer shall agree to reimburse
     or pay directly other fees and expenses identified in Section 3.02 hereof
     as payable, and the Note Insurer shall have received a fully executed copy
     of the Fee Letter.

          (b) Transaction Documents. The Note Insurer shall have received a copy
     of each of the Transaction Documents, in form and substance satisfactory to
     the Note Insurer, duly authorized, executed and delivered by each party
     thereto.

          (c) Certified Documents and Resolutions. The Note Insurer shall have
     received a copy of (i) the certificate of incorporation, limited liability
     company agreement and bylaws or other organizational documents, as
     applicable, of each COAF Company and (ii) the resolutions of each COAF
     Company's Board of Directors or members or a committee thereof, as
     applicable, authorizing the issuance of the Notes and the execution,
     delivery and performance by each COAF Company of the Transaction Documents
     and the transactions contemplated thereby, certified by the Secretary or an
     Assistant Secretary of each COAF Company (which certificate shall state
     that such certificate of incorporation, bylaws and resolutions or other
     organizational documents are in full force and effect without modification
     on the Date of Issuance).

          (d) Incumbency Certificate. The Note Insurer shall have received a
     certificate of the Secretary or an Assistant Secretary of each COAF Company
     certifying the names and signatures of the officers of such COAF Company
     authorized to execute and deliver the Transaction Documents and that
     shareholder, partner or member (as applicable) consent to the execution and
     delivery of such documents is not necessary.

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<PAGE>

          (e) Representations and Warranties; Certificate. The representations
     and warranties of each COAF Company set forth or incorporated by reference
     in this Insurance Agreement shall be true and correct as of the Date of
     Issuance as if made on the Date of Issuance, and the Note Insurer shall
     have received a certificate of appropriate officers of each COAF Company to
     that effect.

          (f) Opinions of Counsel.

               (i) In-house counsel for COAF shall have issued its favorable
          opinion, in form and substance acceptable to the Note Insurer and its
          counsel, regarding the corporate existence and authority of COAF, in
          its capacity as Transferor and as Servicer.

               (ii) The law firm of Richards, Layton & Finger shall have issued
          its favorable opinion, in form and substance acceptable to the Note
          Insurer and its counsel, regarding the corporate existence and
          authority of the Seller.

               (iii) The law firm of Richards, Layton & Finger shall have issued
          its favorable opinion, in form and substance acceptable to the Note
          Insurer and its counsel, regarding the corporate existence and
          authority of the Owner Trustee.

               (iv) The law firm of Mayer, Brown, Rowe & Maw shall have
          furnished its favorable opinion in form and substance acceptable to
          the Note Insurer and its counsel, regarding the validity and
          enforceability of the Transaction Documents against COAF, in its
          capacity as Transferor and as Servicer.

               (v) The law firm of Mayer, Brown, Rowe & Maw shall have furnished
          its favorable opinion in form and substance acceptable to the Note
          Insurer and its counsel, regarding the validity and enforceability of
          the Transaction Documents against the Seller and the Owner Trustee.

               (vi) The law firm of Mayer, Brown, Rowe & Maw shall have
          furnished its opinions, in form and substance acceptable to the Note
          Insurer and its counsel, regarding the transfer of the Trust Property,
          certain bankruptcy issues and the tax treatment of the Class A Notes
          under federal tax laws.

               (vii) The Note Insurer shall have received such other opinions of
          counsel, in form and substance acceptable to the Note Insurer and its
          counsel, addressing such other matters as the Note Insurer may
          reasonably request.

          (g) Approvals, Etc. The Note Insurer shall have received true and
     correct copies of all approvals, licenses and consents, if any, including,
     without limitation, any required approval of the shareholders of any COAF
     Company, required in connection with the Transaction.

          (h) No Litigation, Etc. No suit, action or other proceeding,
     investigation or injunction, or final judgment relating thereto, shall be
     pending or threatened before any court or governmental agency in which it
     is sought to restrain or prohibit or to obtain

                                       21

<PAGE>

     damages or other relief in connection with the Transaction Documents or the
     consummation of the Transaction.

          (i) Legality. No statute, rule, regulation or order shall have been
     enacted, entered or deemed applicable by any government or governmental or
     administrative agency or court that would make the transactions
     contemplated by any of the Transaction Documents illegal or otherwise
     prevent the consummation thereof.

          (j) Satisfaction of Conditions of the Underwriting Agreement. All
     conditions in the Underwriting Agreement relating to the Initial
     Purchasers' obligation to purchase the Class A Notes shall have been
     satisfied.

          (k) Issuance of Ratings. The Note Insurer shall have received
     confirmation that the risk secured by the Note Policy constitutes an
     investment-grade risk, that the Class A-1 Notes when issued will be rated
     "A-1+" by S&P, "F-1" by Fitch, and "Prime-1" by Moody's and that the Class
     A-2 Notes, Class A-3-A Notes, Class A-3-B Notes and Class A-4 Notes, when
     issued, will be rated "AAA" by S&P, "AAA" by Fitch, and "Aaa" by Moody's.

          (l) No Default. No Default or Event of Default shall have occurred.

          (m) Additional Items. The Note Insurer shall have received such other
     documents, instruments, approvals or opinions requested by the Note Insurer
     as may be reasonably necessary to effect the Transaction, including, but
     not limited to, evidence satisfactory to the Note Insurer that the
     conditions precedent, if any, in the Transaction Documents have been
     satisfied.

          (n) Underwriting Agreement. The Note Insurer shall have received
     copies of each of the documents, and specifically be entitled to rely on
     each of the documents, required to be delivered to the Underwriters
     pursuant to the Underwriting Agreement.

          (o) Conform to Documents. The Note Insurer and its counsel shall have
     determined that all documents, certificates and opinions to be delivered in
     connection with the Class A Notes conform to the terms of the Transaction
     Documents.

          (p) Perfection of Security Interest. All actions required to be taken
     to perfect the security interest of the Owner Trustee and the Indenture
     Trustee in the Trust Property shall have been performed.

     Section 3.02. Payment of Fees and Premium.

          (a) Legal and Accounting Fees. The Servicer shall pay or cause to be
     paid, on the Date of Issuance, legal fees and disbursements incurred by the
     Note Insurer in connection with the issuance of the Policies in accordance
     with the terms of the Fee Letter. Any fees of the Note Insurer's auditors
     payable in respect of any amendment or supplement to the Prospectus or any
     other Prospectus incurred after the Date of Issuance shall be paid by the
     Servicer on demand.

                                       22

<PAGE>

          (b) Premium. In consideration of the issuance by the Note Insurer of
     the Policies, the Note Insurer shall be entitled to receive the Premium as
     and when due in accordance with the terms of the Fee Letter (i) in the case
     of Premium due on or before the Date of Issuance, directly from the
     Servicer and (ii) in the case of Premium due after the Date of Issuance,
     pursuant to the Indenture. The Premium paid hereunder or under the
     Indenture shall be nonrefundable without regard to whether the Note Insurer
     makes any payment under the Policies or any other circumstances relating to
     the Class A Notes or provision being made for payment of the Class A Notes
     prior to maturity. The Servicer or the Indenture Trustee, as the case may
     be, shall make all payments of Premium to be made by them by wire transfer
     to an account designated from time to time by the Note Insurer by written
     notice to the Servicer or the Indenture Trustee, respectively.

     Section 3.03. Reimbursement and Additional Payment Obligation.

          (a) In accordance with the priorities established in Section 5.05(c)
     of the Indenture, the Note Insurer shall be entitled to (i) reimbursement
     for any payment made by the Note Insurer under the Policies, which
     reimbursement shall be due and payable on the date that any amount is to be
     paid pursuant to a Notice (as defined in the Note Policy) or Demand for
     Payment (as defined in the Swap Policy), in an amount equal to the amount
     to be so paid and all amounts previously paid that remain unreimbursed,
     together with interest on any and all amounts remaining unreimbursed (to
     the extent permitted by law, if in respect of any unreimbursed amounts
     representing interest) from the date such amounts became due until paid in
     full (after as well as before judgment), at a rate of interest equal to the
     Late Payment Rate and (ii) payment or reimbursement of any other amounts
     owed to the Note Insurer under this Agreement together with interest
     thereon at a rate equal to the Late Payment Rate.

          (b) The Servicer agrees to pay to the Note Insurer as follows:
     anything in subsection 3.03(a) to the contrary notwithstanding, the Note
     Insurer shall be entitled to reimbursement from the Servicer (i) for
     payments made under the Policies arising as a result of the failure by any
     COAF Company to repurchase any Receivable required to be repurchased
     pursuant to Section 2.15 of the Indenture, Section 7.02 of the Transfer and
     Assignment Agreement and Section 7.02 of the Contribution Agreement,
     together with interest on any and all amounts remaining unreimbursed (to
     the extent permitted by law, if in respect of any unreimbursed amounts
     representing interest) from the date such amounts became due until paid in
     full (after as well as before judgment), at a rate of interest equal to the
     Late Payment Rate, and (ii) for payments made under the Policies, arising
     as a result of the Servicer's failure to deposit into the Collection
     Account any amount required to be so deposited pursuant to any Transaction
     Document, together with interest on any and all amounts remaining
     unreimbursed (to the extent permitted by law, if in respect to any
     unreimbursed amounts representing interest) from the date such amounts
     became due until paid in full (after as well as before judgment), at a rate
     of interest equal to the Late Payment Rate.

          (c) The Servicer agrees to pay to the Note Insurer as follows: any and
     all charges, fees, costs and expenses that the Note Insurer may reasonably
     pay or incur,

                                       23

<PAGE>

     including, but not limited to, attorneys' and accountants' fees and
     expenses, in connection with (i) any accounts established to facilitate
     payments under the Policies to the extent the Note Insurer has not been
     immediately reimbursed on the date that any amount is paid by the Note
     Insurer under the Policies, (ii) the enforcement, defense or preservation
     of any rights in respect of any of the Transaction Documents, including,
     without limitation, instituting, defending, monitoring or participating in
     any litigation or proceeding (including, without limitation, any insolvency
     or bankruptcy proceeding in respect of any Transaction participant or any
     affiliate thereof) relating to any of the Transaction Documents, any party
     to any of the Transaction Documents, in its capacity as such a party, or
     the Transaction, (iii) any action, proceeding or investigation affecting
     the Issuer, the Trust Property or the rights or obligations of the Note
     Insurer under the Policies or the Transaction Documents, including (without
     limitation) any judgment or settlement entered into affecting the Note
     Insurer or the Note Insurer's interests, (iv) any consent, amendment,
     waiver or other action with respect to, or related to, any Transaction
     Document, whether or not executed or completed or (v) preparation of bound
     volumes of the Transaction Documents; costs and expenses shall include a
     reasonable allocation of compensation and overhead attributable to the time
     of employees of the Note Insurer spent in connection with the actions
     described in clause (ii) above ("Reimbursable Amounts"). Reimbursable
     Amounts due to the Note Insurer shall bear interest at a rate equal to the
     Late Payment Rate. In the event that the Servicer fails to pay to the Note
     Insurer any Reimbursable Amounts, the Note Insurer shall be entitled to
     reimbursement of such amount together with interest thereon from Section
     5.05 of the Indenture. In addition, the Note Insurer reserves the right to
     charge a reasonable fee as a condition to executing any waiver, consent or
     amendment proposed in respect of any of the Transaction Documents.

          (d) Servicer agrees to pay to the Note Insurer as follows: interest on
     any and all amounts described in subclauses (b), (c), (e) and (f) of this
     Section 3.03 from the date payable or paid by such party until payment
     thereof in full, and interest on any and all amounts described in Section
     3.02 from the date due until payment thereof in full, in each case, payable
     to the Note Insurer at the Late Payment Rate per annum.

          (e) The Servicer agrees to pay to the Note Insurer as follows: any
     payments made by the Note Insurer on behalf of, or advanced to, the
     Servicer or the Transferor, respectively, including, without limitation,
     any amounts payable by the Servicer or Transferor pursuant to the Notes or
     any other Transaction Documents.

          (f) Following optional redemption of the Notes pursuant to Section
     6.02 of the Indenture, the Servicer agrees to reimburse the Note Insurer
     for any Insured Payments required to be made pursuant to the Policies
     subsequent to the date of such termination.

     All such amounts are to be immediately due and payable without demand.

          (g) Notwithstanding any other provisions of this Agreement, none of
     the terms and provisions of this Agreement shall ever be construed to
     create a contract to pay to the Note Insurer for the use, forbearance or
     detention of money, interest in excess of the maximum amount of interest
     permitted to be charged by the Note Insurer to any of

                                       24

<PAGE>

     the COAF Companies under applicable state or federal law from time to time
     in effect, and none of the COAF Companies shall ever be required to pay
     interest in excess of such maximum amount. If, for any reason, interest is
     paid hereunder in excess of such maximum amount, then promptly upon any
     determination that such excess has been paid the Note Insurer will, at its
     option, either refund such excess to the payor thereof or apply such excess
     to the principal owing by such payor hereunder.

     Section 3.04. Indemnification; Limitation of Liability.

          (a) In addition to any and all rights of indemnification or any other
     rights of the Note Insurer pursuant hereto or under law or equity, the
     Servicer and the Transferor and any successor thereto agree to pay, and to
     protect, indemnify and save harmless, the Note Insurer and its officers,
     directors, shareholders, employees, agents and each person, if any, who
     controls the Note Insurer within the meaning of either Section 15 of the
     Securities Act or Section 20 of the Securities Exchange Act from and
     against any and all claims, losses, liabilities (including penalties),
     actions, suits, judgments, demands, damages, costs or reasonable expenses
     (including, without limitation, reasonable fees and expenses of attorneys,
     consultants and auditors and reasonable costs of investigations) or
     obligations whatsoever paid by the Note Insurer (herein collectively
     referred to as "Liabilities") of any nature arising out of or relating to
     the transactions contemplated by the Transaction Documents by reason of:

               (i) to the extent not covered by the Indemnification Agreement
          any act or omission of any COAF Company in connection with the
          offering, issuance, sale or delivery of the Notes other than by reason
          of false or misleading information provided by the Note Insurer in
          writing for inclusion in the Prospectus or the allegation thereof;

               (ii) the misfeasance or malfeasance of, or negligence or theft
          committed by, any director, officer, employee or agent of any COAF
          Company;

               (iii) the violation by any COAF Company of any federal or state
          securities, banking or antitrust laws, rules or regulations in
          connection with the issuance, offer and sale of the Notes or the
          transactions contemplated by the Transaction Documents;

               (iv) the violation by any COAF Company of any federal or state
          laws, rules or regulations relating to the Transaction or the
          origination of the Receivables, including, without limitation, any
          consumer protection, lending and disclosure laws or any laws with
          respect to the maximum amount of interest permitted to be received on
          account of any loan of money or with respect to the Receivables;

               (v) the breach by the Servicer or the Transferor of any of its
          obligations under this Insurance Agreement or any of the Transaction
          Documents;

               (vi) the breach by the Servicer or the Transferor of any
          representation or warranty on the part of the Servicer or the
          Transferor contained in the

                                       25

<PAGE>

          Transaction Documents or in any certificate or report furnished or
          delivered to the Note Insurer thereunder; and

               (vii) any claim, counterclaim, rescission, setoff or defense
          asserted by an Obligor relating to the goods and services provided in
          connection with any Receivable or Financed Vehicle.

          This indemnity provision shall survive the termination of this
     Insurance Agreement and shall survive until the statute of limitations has
     run on any causes of action which arise from one of these reasons and until
     all suits filed as a result thereof have been finally concluded.

          (b) Any party which proposes to assert the right to be indemnified
     under this Section 3.04 will, promptly after receipt of notice of
     commencement of any action, suit or proceeding against such party in
     respect of which a claim is to be made against the Servicer or the
     Transferor under this Section 3.04(b), notify the Servicer and the
     Transferor of the commencement of such action, suit or proceeding,
     enclosing a copy of all papers served. In case any action, suit or
     proceeding shall be brought against any indemnified party and it shall
     notify the Servicer and the Transferor of the commencement thereof, the
     Servicer and the Transferor shall be entitled to participate in, and, to
     the extent that it shall wish, to assume the defense thereof, with counsel
     satisfactory to such indemnified party, and after notice from the Servicer
     and the Transferor to such indemnified party of its election so to assume
     the defense thereof, the Servicer and the Transferor shall not be liable to
     such indemnified party for any legal or other expenses other than
     reasonable costs of investigation subsequently incurred by such indemnified
     party in connection with the defense thereof. The indemnified party shall
     have the right to employ its counsel in any such action the defense of
     which is assumed by the Servicer and the Transferor in accordance with the
     terms of this subsection (b), but the fees and expenses of such counsel
     shall be at the expense of such indemnified party unless the employment of
     counsel by such indemnified party has been authorized by the Servicer and
     the Transferor. The Servicer and the Transferor shall not be liable for any
     settlement of any action or claim effected without its consent.

     Section 3.05. Payment Procedure. In the event of any payment by the Note
Insurer, the Indenture Trustee and the Servicer agree to accept the voucher or
other evidence of payment as prima facie evidence of the propriety thereof and
the liability therefor to the Note Insurer. All payments to be made to the Note
Insurer under this Insurance Agreement shall be made to the Note Insurer in
lawful currency of the United States of America in immediately available funds
at the notice address for the Note Insurer as specified in the Indenture on the
date when due or as the Note Insurer shall otherwise direct by written notice to
the other parties hereto. In the event that the date of any payment to the Note
Insurer or the expiration of any time period hereunder occurs on a day which is
not a Business Day, then such payment or expiration of time period shall be made
or occur on the next succeeding Business Day with the same force and effect as
if such payment was made or time period expired on the scheduled date of payment
or expiration date. Payments to be made to the Note Insurer under this Insurance
Agreement shall bear interest at the Late Payment Rate from the date when due to
the date paid.

                                       26

<PAGE>

     Section 3.06. Reimbursement. The parties hereto acknowledge that, to the
extent of any payment made by the Note Insurer pursuant to the Policies, the
Note Insurer has the right to be reimbursed such amounts plus interest thereon
at the Late Payment Rate, all in accordance with Section 5.05(c) of the
Indenture and in accordance with the priorities set forth therein for
reimbursement of the Note Insurer.

                                   ARTICLE IV

                               FURTHER AGREEMENTS

     Section 4.01. Effective Date; Term of the Insurance Agreement. This
Insurance Agreement shall take effect on the Date of Issuance and shall remain
in effect until the later of (a) such time as the Note Insurer is no longer
subject to a claim under the Policies and the Policies shall have been
surrendered to the Note Insurer for cancellation and (b) all amounts payable to
the Note Insurer by any COAF Company or from any other source under the
Transaction Documents and all amounts payable under the Class A Notes have been
paid in full; provided, however, that the provisions of Sections 3.03 and 3.04
hereof shall survive any termination of this Insurance Agreement.

     Section 4.02. Further Assurances and Corrective Instruments.

          (a) Excepting at such times as a default in payment under the Policies
     shall exist or shall have occurred, none of the COAF Companies or the
     Indenture Trustee shall grant any waiver of rights under any of the
     Transaction Documents to which any of them is a party without the prior
     written consent of the Note Insurer, and any such waiver without the
     written consent of the Note Insurer shall be null and void and of no force
     or effect.

          (b) To the extent permitted by law, the COAF Companies agree that they
     will, from time to time, execute, acknowledge and deliver, or cause to be
     executed, acknowledged and delivered, such supplements hereto and such
     further instruments as the Note Insurer may request and as may be required
     in the Note Insurer's judgment to effectuate the intention of or facilitate
     the performance of this Insurance Agreement.

     Section 4.03. Obligations Absolute.

          (a) The obligations of the COAF Companies hereunder shall be absolute
     and unconditional and shall be paid or performed strictly in accordance
     with this Insurance Agreement under all circumstances irrespective of:

               (i) any lack of validity or enforceability of, or any amendment
          or other modifications of, or waiver, with respect to any of the
          Transaction Documents, the Class A Notes or either Policy;

               (ii) any exchange or release of any other obligations hereunder;

                                       27

<PAGE>

               (iii) the existence of any claim, setoff, defense, reduction,
          abatement or other right that any of the COAF Companies may have at
          any time against the Note Insurer or any other Person;

               (iv) any document presented in connection with the Policies
          proving to be forged, fraudulent, invalid or insufficient in any
          respect or any statement therein being untrue or inaccurate in any
          respect;

               (v) any payment by the Note Insurer under the Policies against
          presentation of a certificate or other document that does not strictly
          comply with terms of the Policies;

               (vi) any failure of any of the COAF Companies to receive the
          proceeds from the sale of the Notes; or

               (vii) any breach by any of the COAF Companies of any
          representation, warranty or covenant contained in any of the
          Transaction Documents.

          (b) Each of the COAF Companies and any and all others who are now or
     may become liable for all or part of the obligations of any of the COAF
     Companies under this Insurance Agreement agree to be bound by this
     Insurance Agreement and (i) to the extent permitted by law, waive and
     renounce any and all redemption and exemption rights and the benefit of all
     valuation and appraisement privileges against the indebtedness and
     obligations evidenced by any Transaction Document or by any extension or
     renewal thereof; (ii) waive presentment and demand for payment, notices of
     nonpayment and of dishonor, protest of dishonor and notice of protest;
     (iii) waive all notices in connection with the delivery and acceptance
     hereof and all other notices in connection with the performance, default or
     enforcement of any payment hereunder, except as required by the Transaction
     Documents; (iv) waive all rights of abatement, diminution, postponement or
     deduction, or any defense other than payment, or to any right of setoff or
     recoupment arising out of any breach under any of the Transaction
     Documents, by any party thereto or any beneficiary thereof, or out of any
     obligation at any time owing to any of the COAF Companies; (v) agree that
     its liabilities hereunder shall, except as otherwise expressly provided in
     this Section 4.03, be unconditional and without regard to any setoff,
     counterclaim or the liability of any other Person for the payment hereof;
     (vi) agree that any consent, waiver or forbearance hereunder with respect
     to an event shall operate only for such event and not for any subsequent
     event; (vii) consent to any and all extensions of time that may be granted
     by the Note Insurer with respect to any payment hereunder or other
     provisions hereof and to the release of any security at any time given for
     any payment hereunder, or any part thereof, with or without substitution,
     and to the release of any Person or entity liable for any such payment; and
     (viii) consent to the addition of any and all other makers, endorsers,
     guarantors and other obligors for any payment hereunder, and to the
     acceptance of any and all other security for any payment hereunder, and
     agree that the addition of any such obligors or security shall not affect
     the liability of the parties hereto for any payment hereunder.

                                       28

<PAGE>

          (c) Nothing herein shall be construed as prohibiting any COAF Company
     from pursuing any rights or remedies it may have against any other Person
     in a separate legal proceeding.

     Section 4.04. Assignments; Reinsurance; Third-party Rights.

          (a) This Insurance Agreement shall be a continuing obligation of the
     parties hereto and shall be binding upon and inure to the benefit of the
     parties hereto and their respective successors and permitted assigns. No
     COAF Company may assign its rights under this Insurance Agreement, or
     delegate any of its duties hereunder, without the prior written consent of
     the Note Insurer.

          (b) The Note Insurer shall have the right to give participations in
     its rights under this Insurance Agreement and to enter into contracts of
     reinsurance with respect to the Policies upon such terms and conditions as
     the Note Insurer may in its discretion determine; provided, however, that
     no such participation or reinsurance agreement or arrangement shall relieve
     the Note Insurer of any of its obligations hereunder or under the Policies.

          (c) In addition, the Note Insurer shall be entitled to assign or
     pledge to any bank or other lender providing liquidity or credit with
     respect to the Transaction or the obligations of the Note Insurer in
     connection therewith any rights of the Note Insurer under the Transaction
     Documents or with respect to any real or personal property or other
     interests pledged to the Note Insurer, or in which the Note Insurer has a
     security interest, in connection with the Transaction.

          (d) Except as provided herein with respect to participants and
     reinsurers, nothing in this Insurance Agreement shall confer any right,
     remedy or claim, express or implied, upon any Person, including,
     particularly, any Owner, other than the Note Insurer against any COAF
     Company, and all the terms, covenants, conditions, promises and agreements
     contained herein shall be for the sole and exclusive benefit of the parties
     hereto and their successors and permitted assigns. Neither the Indenture
     Trustee, the Owner Trustee nor any Owner shall have any right to payment
     from any Premiums paid or payable hereunder or under the Indenture or from
     any other amounts paid by any COAF Company pursuant to Section 3.02 or 3.03
     hereof.

     Section 4.05. Liability of the Note Insurer. Neither the Note Insurer nor
any of its officers, directors or employees shall be liable or responsible for
(a) the use that may be made of the Policies by the Indenture Trustee, or the
Swap Provider, as applicable, or for any acts or omissions of the Indenture
Trustee in connection therewith; or (b) the validity, sufficiency, accuracy or
genuineness of documents delivered to the Note Insurer (or its Fiscal Agent) in
connection with any claim under the Policies, or of any signatures thereon, even
if such documents or signatures should in fact prove to be in any or all
respects invalid, insufficient, fraudulent or forged (unless the Note Insurer
shall have actual knowledge thereof). In furtherance and not in limitation of
the foregoing, the Note Insurer (or its Fiscal Agent) may accept documents that
appear on their face to be in order, without responsibility for further
investigation.

                                       29

<PAGE>

     Section 4.06. No Proceedings. So long as this Insurance Agreement is in
effect, and for one year and one day following its termination, each party
hereto agrees that it will not file any involuntary petition or otherwise
institute any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceedings under any federal or state bankruptcy or similar
law against the Seller. The parties hereto agree that this Section 4.06 shall
survive termination of this Insurance Agreement.

     Section 4.07. Parties To Join in Enforcement Action.

          (a) To the extent necessary to enforce any right of the Note Insurer
     in or remedy of the Note Insurer under any Receivable or related asset, the
     Indenture Trustee, Owner Trustee and each COAF Company agree to join in any
     action initiated by the Indenture Trustee or the Note Insurer for the
     protection of such right or exercise of such remedy.

          (b) In the event of any court proceeding (x) with respect to which a
     COAF Company is a party (including, without limitation, an insolvency or
     bankruptcy proceeding in respect of any COAF Company) which affects the
     Trust Property, the Policies or the obligations of the Note Insurer under
     the Transaction Documents, and (y) with respect to which such COAF Company
     fails to defend or answer, the Note Insurer shall have the right to direct,
     assume or otherwise participate in the defense thereof. In such event, the
     Note Insurer shall, following written notice to the Indenture Trustee, have
     the exclusive right to determine, in its sole discretion, the actions
     necessary to preserve and protect the Trust Property. All costs and
     expenses of the Note Insurer in connection with such action, proceeding or
     investigation, (including, without limitation, any judgment or settlement
     entered into or paid by the Note Insurer), shall be included in the
     Reimbursement Obligations.

          (c) The Indenture Trustee shall cooperate with, and take such action
     as directed by, the Note Insurer, including (without limitation) entering
     into such agreements and settlements as the Note Insurer in its sole
     discretion shall direct with respect to such court proceeding. The
     Indenture Trustee shall not be liable to the Note Insurer for any such
     action that conforms to the direction of the Note Insurer. The Indenture
     Trustee's reasonable out-of-pocket costs and expenses (including attorneys'
     fees and expenses) with respect to any such action shall be reimbursed
     pursuant to Section 5.05 of the Indenture; provided, however, that if such
     costs and expenses are not so reimbursed on the Payment Date immediately
     following the date incurred, then the Note Insurer shall reimburse the
     Indenture Trustee for such costs and expenses within 60 days of such
     nonpayment.

          (d) The Indenture Trustee hereby agrees to provide to the Note Insurer
     prompt written notice of any action, proceeding or investigation that names
     the Owner Trustee as a party or that could adversely affect the Trust
     Property or the rights or obligations of the Note Insurer hereunder or
     under the Policies or the other Transaction Documents, including (without
     limitation) any insolvency or bankruptcy proceeding in respect of the
     Servicer, the Transferor, the Depositor or any affiliate thereof.

                                       30

<PAGE>

          (e) Notwithstanding anything contained herein or in any of the other
     Transaction Documents to the contrary, the Indenture Trustee shall not,
     without the Note Insurer's prior written consent or unless directed by the
     Note Insurer, undertake or join any litigation or agree to any settlement
     of any action, proceeding or investigation affecting the Owner Trustee or
     the Trust Property or the rights or obligations of the Note Insurer
     hereunder or under the Policies or the other Transaction Documents.

                                   ARTICLE V

                               DEFAULTS; REMEDIES

     Section 5.01. Defaults. The occurrence of any of the following events shall
constitute an Event of Default hereunder:

          (a) An Insurance Agreement Event of Default shall occur and be
     continuing;

          (b) (i) Any COAF Company shall fail to pay when due any amount payable
     by such COAF Company hereunder or (ii) a legislative body has enacted any
     law that declares or a court of competent jurisdiction shall find or rule
     that any of the Transaction Documents are not valid and binding on any COAF
     Company;

          (c) A decree or order of a court or agency or supervisory authority
     having jurisdiction in the premises in an involuntary case under any
     present or future federal or state bankruptcy, insolvency or similar law or
     the appointment of a conservator or receiver or liquidator or other similar
     official in any insolvency, readjustment of debt, marshalling of assets and
     liabilities or similar proceedings, or for the winding-up or liquidation of
     its affairs, shall have been entered against any COAF Company and such
     decree or order shall have remained in force undischarged or unstayed for a
     period of 90 consecutive days;

          (d) Any COAF Company shall consent to the appointment of a conservator
     or receiver or liquidator or other similar official in any insolvency,
     readjustment of debt, marshalling of assets and liabilities or similar
     proceedings of or relating to any COAF Company or of or relating to all or
     substantially all of the property of any of them; or

          (e) Any COAF Company shall admit in writing its inability to pay its
     debts generally as they become due, file a petition to take advantage of or
     otherwise voluntarily commence a case or proceeding under any applicable
     bankruptcy, insolvency, reorganization or other similar statute, make an
     assignment for the benefit of its creditors or voluntarily suspend payment
     of its obligations.

     Section 5.02. Remedies; No Remedy Exclusive.

          (a) Upon the occurrence of an Event of Default, the Note Insurer may
     exercise any one or more of the rights and remedies set forth below:

               (i) declare all indebtedness of every type or description then
          owed by any COAF Company to the Note Insurer pursuant to the
          Transaction Documents

                                       31

<PAGE>

          to be immediately due and payable, and the same shall thereupon be
          immediately due and payable provided, however, that any such payment
          by the Seller or the Owner Trustee shall be paid in accordance with
          Section 5.05(c) of the Indenture and, to the extent additional funds
          are available, as set forth in Section 14.20 of the Indenture;

               (ii) exercise any rights and remedies under the Transaction
          Documents in accordance with the terms of the Transaction Documents or
          direct the Indenture Trustee to exercise such remedies in accordance
          with the terms of the Transaction Documents; or

               (iii) take whatever action at law or in equity as may appear
          necessary or desirable in its judgment to collect the amounts then due
          under this Insurance Agreement or the Transaction Documents or to
          enforce performance and observance of any obligation, agreement or
          covenant of any COAF Company under this Insurance Agreement or the
          Transaction Documents.

          (b) Unless otherwise expressly provided, no remedy herein conferred
     upon or reserved is intended to be exclusive of any other available remedy,
     but each remedy shall be cumulative and shall be in addition to other
     remedies given under this Insurance Agreement, the Transaction Documents or
     existing at law or in equity. No delay or omission to exercise any right or
     power accruing under this Insurance Agreement or the Transaction Documents
     upon the happening of any event set forth in Section 5.01 hereof shall
     impair any such right or power or shall be construed to be a waiver
     thereof, but any such right and power may be exercised from time to time
     and as often as may be deemed expedient. In order to entitle the Note
     Insurer to exercise any remedy reserved to the Note Insurer in this
     Article, it shall not be necessary to give any notice, other than such
     notice as may be required in this Article.

     Section 5.03. Waivers.

          (a) No failure by the Note Insurer to exercise, and no delay by the
     Note Insurer in exercising, any right hereunder shall operate as a waiver
     thereof. The exercise by the Note Insurer of any right hereunder shall not
     preclude the exercise of any other right, and the remedies provided herein
     to the Note Insurer are declared in every case to be cumulative and not
     exclusive of any remedies provided by law or equity.

          (b) The Note Insurer shall have the right, to be exercised in its
     complete discretion, to waive any Event of Default hereunder, by a writing
     setting forth the terms, conditions and extent of such waiver signed by the
     Note Insurer and delivered to the Servicer. Unless such writing expressly
     provides to the contrary, any waiver so granted shall extend only to the
     specific event or occurrence which gave rise to the Event of Default so
     waived and not to any other similar event or occurrence which occurs
     subsequent to the date of such waiver.

                                       32

<PAGE>

                                   ARTICLE VI

                                  MISCELLANEOUS

     Section 6.01. Amendments, Etc. This Insurance Agreement may be amended,
modified or terminated only by written instrument or written instruments signed
by the parties hereto. The Servicer agrees to promptly provide a copy of any
amendment to this Insurance Agreement to the Indenture Trustee and the Rating
Agencies. No act or course of dealing shall be deemed to constitute an
amendment, modification or termination hereof.

     Section 6.02. Notices. All demands, notices and other communications to be
given hereunder shall be in writing (except as otherwise specifically provided
herein) and shall be mailed by registered mail or personally delivered or
telecopied to the recipient as follows:

            (a) To the Note Insurer:

                MBIA Insurance Corporation
                113 King Street
                Armonk, NY 10504
                Attention: Insured Portfolio Management--Structured
                              Finance (IPM-SF) Capital One 2002-C
                Facsimile: (914) 765-3810
                Confirmation: (914) 273-4545

            (b) To the Servicer:

                Capital One Auto Finance, Inc.
                1680 Capital One Drive
                McLean, Virginia 22102
                Attention: Director of Securitization
                Facsimile: (703) 720-2121
                Confirmation: (703)-720-1000

                With a copy to Legal Department
                Facsimile: (703) 720-2121
                Confirmation: (703) 875-1000

            (c) To the Transferor:

                Capital One Auto Finance, Inc.

                                       33

<PAGE>

                1680 Capital One Drive
                McLean, Virginia 22102
                Attention: Director of Securitization
                Facsimile: (703) 720-2121
                Confirmation: (703)-720-1000

                With a copy to Legal Department
                Facsimile: (703) 720-2121
                Confirmation: (703)-720-1000

            (d) To the Seller:

                Capital One Auto Receivables, LLC
                1680 Capital One Drive
                McLean, Virginia 22102
                Attention: Director of Securitization
                Facsimile: (703) 720-2121
                Confirmation: (703)-720-1000

                With a copy to Legal Department
                Facsimile: (703) 720-2121
                Confirmation: (703)-720-1000

            (e) To the Indenture Trustee:

                JPMorgan Chase Bank
                4 New York Plaza, 6th Floor
                New York, New York 10004-2413
                Attention: Institutional Trust Services-Capital One Auto
                              Finance 2002-C
                Facsimile: (212) 623-5932
                Confirmation: (212) 623-5379

            (f) To the Owner Trustee:

                Wilmington Trust Company
                Rodney Square North
                North Market Street
                Wilmington, DE 19890
                Attention: Corporate Trust Administration-Capital
                              One Auto Finance Trust 2002-C
                Facsimile: (302) 651-8653
                Confirmation: (302) 651-8882

            (g) To the Representative of the Underwriters:

                Banc of America Securities LLC
                10th Floor

                                       34

<PAGE>

                100 North Tryon Street
                Charlotte, NC 28255-0001
                Attention: Andrew Glenn
                Facsimile: (704) 386-2731
                Confirmation: (704) 386-7233

     A party may specify an additional or different address or addresses by
writing mailed or delivered to the other parties as aforesaid. All such notices
and other communications shall be effective upon receipt.

     Section 6.03. Severability. In the event that any provision of this
Insurance Agreement shall be held invalid or unenforceable by any court of
competent jurisdiction, the parties hereto agree that such holding shall not
invalidate or render unenforceable any other provision hereof. The parties
hereto further agree that the holding by any court of competent jurisdiction
that any remedy pursued by any party hereto is unavailable or unenforceable
shall not affect in any way the ability of such party to pursue any other remedy
available to it.

     Section 6.04. Governing Law. This Insurance Agreement shall be governed by
and construed in accordance with the laws of the State of New York.

     Section 6.05. Consent to Jurisdiction.

          (a) The parties hereto hereby irrevocably submit to the jurisdiction
     of the United States District Court for the Southern District of New York
     and any court in the State of New York located in the City and County of
     New York, and any appellate court from any thereof, in any action, suit or
     proceeding brought against it and to or in connection with any of the
     Transaction Documents or the transactions contemplated thereunder or for
     recognition or enforcement of any judgment, and the parties hereto hereby
     irrevocably and unconditionally agree that all claims in respect of any
     such action or proceeding may be heard or determined in such New York state
     court or, to the extent permitted by law, in such federal court. The
     parties hereto agree that a final judgment in any such action, suit or
     proceeding shall be conclusive and may be enforced in other jurisdictions
     by suit on the judgment or in any other manner provided by law. To the
     extent permitted by applicable law, the parties hereto hereby waive and
     agree not to assert by way of motion, as a defense or otherwise in any such
     suit, action or proceeding, any claim that it is not personally subject to
     the jurisdiction of such courts, that the suit, action or proceeding is
     brought in an inconvenient forum, that the venue of the suit, action or
     proceeding is improper or that the related documents or the subject matter
     thereof may not be litigated in or by such courts.

          (b) To the extent permitted by applicable law, the parties hereto
     shall not seek and hereby waive the right to any review of the judgment of
     any such court by any court of any other nation or jurisdiction which may
     be called upon to grant an enforcement of such judgment.

          (c) Nothing contained in this Insurance Agreement shall limit or
     affect the Note Insurer's right to serve process in any other manner
     permitted by law or to start

                                       35

<PAGE>

     legal proceedings relating to any of the Transaction Documents against any
     COAF Company or its or their property in the courts of any jurisdiction.

     Section 6.06. Consent of the Note Insurer. In the event that the consent of
the Note Insurer is required under any of the Transaction Documents, the
determination whether to grant or withhold such consent shall be made by the
Note Insurer in its sole discretion without any implied duty towards any other
Person, except as otherwise expressly provided therein.

     Section 6.07. Counterparts. This Insurance Agreement may be executed in
counterparts by the parties hereto, and all such counterparts shall constitute
one and the same instrument.

     Section 6.08. Headings. The headings of Articles and Sections and the Table
of Contents contained in this Insurance Agreement are provided for convenience
only. They form no part of this Insurance Agreement and shall not affect its
construction or interpretation. Unless otherwise indicated, all references to
Articles and Sections in this Insurance Agreement refer to the corresponding
Articles and Sections of this Insurance Agreement.

     Section 6.09. Trial by Jury Waived. Each party hereto hereby waives, to the
fullest extent permitted by law, any right to a trial by jury in respect of any
litigation arising directly or indirectly out of, under or in connection with
any of the Transaction Documents or any of the transactions contemplated
thereunder. Each party hereto (a) certifies that no representative, agent or
attorney of any party hereto has represented, expressly or otherwise, that it
would not, in the event of litigation, seek to enforce the foregoing waiver and
(b) acknowledges that it has been induced to enter into the Transaction
Documents to which it is a party by, among other things, this waiver.

     Section 6.10. Limited Liability. No recourse under any Transaction Document
shall be had against, and no personal liability shall attach to, any officer,
employee, director, affiliate or shareholder of any party hereto, as such, by
the enforcement of any assessment or by any legal or equitable proceeding, by
virtue of any statute or otherwise in respect of any of the Transaction
Documents, the Notes or the Policies, it being expressly agreed and understood
that each Transaction Document is solely a corporate obligation of each party
hereto, and that any and all personal liability, either at common law or in
equity, or by statute or constitution, of every such officer, employee,
director, affiliate or shareholder for breaches by any party hereto of any
obligations under any Transaction Document is hereby expressly waived as a
condition of and in consideration for the execution and delivery of this
Insurance Agreement.

     Section 6.11. Entire Agreement. This Insurance Agreement and the Policies
set forth the entire agreement between the parties with respect to the subject
matter thereof, and this Insurance Agreement supersedes and replaces any
agreement or understanding that may have existed between the parties prior to
the date hereof in respect of such subject matter.

     Section 6.12. Limitation of Liability. It is expressly understood and
agreed by and among the parties hereto (i) that this Insurance Agreement is
executed and delivered by Wilmington Trust Company, not in its individual
capacity but solely as Owner Trustee under the Amended and Restated Trust
Agreement dated as of December 17, 2002 with Capital One Auto

                                       36

<PAGE>

Receivables, LLC (the "Trust Agreement") in the exercise of the power and
authority conferred and vested in it as such Owner Trustee, (ii) each of the
representations, undertakings and agreements made herein by the Owner Trustee
are not personal representations, undertakings and agreements of Wilmington
Trust Company, but are binding only on the trust estate created pursuant to the
Trust Agreement, (iii) nothing contained herein shall be construed as creating
any liability on Wilmington Trust Company, individual or personally, to perform
any covenant of the Owner Trustee either expressed or implied contained herein,
all such liability, if any, being expressly waived by the parties hereto and by
any person claiming by, through or under any such party, and (iv) under no
circumstances shall Wilmington Trust Company be personally liable for the
payment of any indebtedness or expense of the Owner Trustee or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Owner Trustee under this Insurance Agreement.

      [Remainder of page intentionally left blank; signature page follows]

                                       37

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Insurance
Agreement, all as of the day and year first above mentioned.

                                       MBIA INSURANCE CORPORATION,
                                       as Note Insurer


                                       By  /s/ Amy R. Gonch
                                          --------------------------------------
                                       Name  Amy R. Gonch
                                            ------------------------------------
                                            Assistant Secretary


                                       CAPITAL ONE AUTO FINANCE, INC.,
                                       as Servicer


                                       By  /s/ Jeffery A. Elswick
                                          --------------------------------------
                                       Name  Jeffery A. Elswick
                                            ------------------------------------
                                       Title  Manager of Securitization
                                             -----------------------------------


                                       CAPITAL ONE AUTO FINANCE, INC.,
                                       as Transferor


                                       By  /s/ Jeffery A. Elswick
                                          --------------------------------------
                                       Name  Jeffery A. Elswick
                                            ------------------------------------
                                       Title  Manager of Securitization
                                             -----------------------------------


                                       WILMINGTON TRUST COMPANY, not in its
                                       individual capacity but solely in its
                                       capacity as Owner Trustee for Capital
                                       One Auto Finance Trust 2002-C


                                       By  /s/ Donald G. Mackelcan
                                          --------------------------------------
                                       Name  Donald G. Mackelcan
                                            ------------------------------------
                                       Title  Vice President
                                             -----------------------------------

                                       CAPITAL ONE AUTO RECEIVABLES, LLC,
                                       as Seller


                                       By  /s/ Jeffery A. Elswick
                                          --------------------------------------
                                       Name  Jeffery A. Elswick
                                            ------------------------------------
                                       Title  President
                                             -----------------------------------

Capital One Auto Finance Trust 2002-C
Insurance Agreement Signature Page

<PAGE>

                                       JPMORGAN CHASE BANK, as Indenture Trustee


                                       By  /s/ Craig M. Kantor
                                          --------------------------------------
                                       Name  Craig M. Kantor
                                            ------------------------------------
                                       Title  Vice President
                                             -----------------------------------

Capital One Auto Finance Trust 2002-C
Insurance Agreement Signature Page