<PAGE>

                                                                   EXHIBIT 10.13

                                 FIFTH AMENDMENT
                                       TO
                 SEVENTH AMENDED AND RESTATED SECURITY AGREEMENT

      THIS FIFTH AMENDMENT TO SEVENTH AMENDED AND RESTATED SECURITY AGREEMENT
(the "Amendment") made and entered into as of the 30th day of June, 2004, by and
among DIRECT GENERAL FINANCIAL SERVICES, INC., a Tennessee corporation whose
address is 1281 Murfreesboro Road, Nashville, Tennessee 37217 (f/k/a Direct
Financial Services, Inc.) ("DGFS"), DIRECT GENERAL PREMIUM FINANCE COMPANY, a
Tennessee corporation whose address is 1281 Murfreesboro Road, Nashville,
Tennessee 37217 ("DGPFC"; and collectively with DGFS the "Grantor"), and FIRST
TENNESSEE BANK NATIONAL ASSOCIATION, whose address is 165 Madison Avenue,
Memphis, Tennessee 38103, Attention: Metropolitan Division (in its agency
capacity being herein referred to as "Agent," and in its individual capacity as
"FTBNA"), as agent for itself, and for HIBERNIA NATIONAL BANK, Baton Rouge,
Louisiana ("Hibernia"), and for U. S. BANK NATIONAL ASSOCIATION, St. Louis,
Missouri ("U. S. Bank"), and for REGIONS BANK, Birmingham, Alabama ("Regions"),
and for CAROLINA FIRST BANK, Greenville, South Carolina ("Carolina First"), and
for BANK ONE, NA (Main Office -- Chicago, Illinois), Baton Rouge, Louisiana
("Bank One"), and for NATIONAL CITY BANK OF KENTUCKY, Louisville, Kentucky
("National City Bank"), and for FIFTH THIRD BANK, N.A. (TENNESSEE), Franklin,
Tennessee ("Fifth Third") (Agent, Hibernia, U. S. Bank, Regions, Carolina First,
National City Bank, Fifth Third, and Bank One collectively, the "Banks," and
each individually, a "Bank"), pursuant to the Eighth Amended and Restated Loan
Agreement dated as of October 31, 2002, as amended (the "Loan Agreement") among
Grantor, Banks and the other parties named therein.

                                Recitals of Fact

      Pursuant to that certain Seventh Amended and Restated Security Agreement
dated as of October 31, 2002, as amended by that certain First Amendment to
Seventh Amended and Restated Security Agreement dated as of March 31, 2003, as
amended by that certain Second Amendment to Seventh Amended and Restated
Security Agreement dated as of May 28, 2003, as amended by that certain Third
Amendment to the Seventh Amended and Restated Security Agreement dated as of
June 30, 2003, and as amended by that certain Fourth Amendment to Seventh
Amended and Restated Security Agreement dated as of November 26, 2003 (as
amended, the "Security Agreement"), between DGFS and the Banks, DGFS assigned
and pledged Receivables (as defined in the Loan Agreement) and other contractual
rights to the Agent for the benefit of the Banks as collateral security for all
of the Obligations (as defined in the Security Agreement) of Grantor to the
Banks.

      DGFS and the Banks are now modifying the terms and conditions of the Loan
Agreement by extending the term of the Loan and by adding DGPFC as a Borrower
under the Loan Agreement and as an additional grantor hereunder. The Grantor and
the Banks now desire to modify certain terms of the Security Agreement as
hereinafter set forth.

      NOW, THEREFORE, in consideration of the premises as set forth in the
Recitals of Fact, the mutual covenants and agreements hereinafter set out, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, it is agreed by the parties as follows:

                                   Agreements

      1.    All capitalized terms used and not defined herein shall have the
meaning ascribed to them in the Loan Agreement.

      2.    To induce the Banks to enter into this Amendment, the Grantor does
hereby absolutely and unconditionally, certify, represent and warrant to the
Banks, and covenants and agrees with the Banks, that:

            (a)   It is the intention of DGPFC to, and DGPFC does hereby, pledge
      and assign a continuing security interest in the Collateral described in
      the Security Agreement to Agent as agent for itself and the Banks, to the
      extent that DGPFC has an interest in any such items of Collateral.
      References to "Grantor" in the Security Agreement shall be deemed to refer
      collectively to DGFS and DGPFC.

            (b)   All representations and warranties made by the Grantor in the
      Loan Agreement, as amended, in the Security Agreement, as amended, and in
      all other loan documents (all of which are herein sometimes called the
      "Loan Documents"), are true, correct and complete in all material respects
      as of the date of this Amendment.

            (c)   As of the date hereof and with the execution of this
      Amendment, there are no existing events, circumstances or conditions which
      constitute, or would, with the giving of notice, lapse of time, or both,
      constitute Events of Default.

<PAGE>

            (d)  There are no existing offsets, defenses or counterclaims to
      the obligations of the Grantor, as set forth in the Notes, the Security
      Agreement, the Loan Agreement, as amended, or in any other Loan Document
      executed by the Grantor, in connection with the Loan.

            (e)  The Grantor does not have any existing claim for damages
      against the Banks arising out of or related to the Loan; and, if and to
      the extent (if any) that the Grantor has or may have any such existing
      claim (whether known or unknown), the Grantor does hereby forever release
      and discharge, in all respects, the Banks with respect to such claim.

            (f)  The Loan Documents, as amended by this Amendment, are valid,
      genuine, enforceable in accordance with their respective terms, and in
      full force and effect.

      3.    Section 2(a) of the Security Agreement, is hereby deleted in its
entirety and the following is inserted in lieu thereof:

            (a)  The full and prompt payment, when due, of the indebtedness
      (and interest thereon) evidenced and to be evidenced by those certain
      promissory notes,

                 (i)    dated as of June 30, 2004, in the principal sum of Forty
                        Million Dollars ($40,000,000.00), executed by Grantor
                        and payable to the order of First Tennessee Bank
                        National Association;

                 (ii)   dated as of June 30, 2004, in the principal sum of
                        Twenty Million Dollars ($20,000,000.00), executed by
                        Grantor and payable to the order of Hibernia;

                 (iii)  dated as of June 30, 2004, in the principal sum of
                        Thirty Million Dollars ($30,000,000.00), executed by
                        Grantor and payable to the order of U. S. Bank;

                 (iv)   dated as of June 30, 2004, in the principal sum of
                        Twenty-Five Million Dollars ($25,000,000.00), executed
                        by Grantor and payable to the order of Regions;

                 (v)    dated as of June 30, 2004, in the principal sum of
                        Fifteen Million Dollars ($15,000,000.00), executed by
                        Grantor and payable to the order of Carolina First;

                 (vi)   dated as of June 30, 2004, in the principal sum of
                        Fifteen Million Dollars ($15,000,000.00), executed by
                        Grantor and payable to the order of National City Bank;

                 (vii)  dated as of June 30, 2004, in the principal sum of Ten
                        Million Dollars ($10,000,000.00), executed by Grantor
                        and payable to the order of Fifth Third; and

                 (viii) dated as of June 30, 2004, in the principal sum of
                        Thirty-Five Million Dollars ($35,000,000.00), executed
                        by Grantor and payable to the order of Bank One,

      together with and any and all renewals, modifications, and extensions of
      any of said notes, in whole or in part; and

      4.    All terms and provisions of the Security Agreement, as heretofore
amended, which are inconsistent with the provisions of this Amendment are hereby
modified and amended to conform hereto; and, as so modified and amended, the
Security Agreement is hereby ratified, approved and confirmed. Except as
otherwise may be expressly provided herein, this Amendment shall become
effective as of the date set forth in the initial paragraph hereof.

      5.    All references in all Loan Documents (including, but not limited to,
the Notes, the Security Agreement, and the Loan Agreement) to the "Security
Agreement" shall, except as the context may otherwise require, be deemed to
constitute references to the Security Agreement as amended hereby.

                        [SEPARATE SIGNATURE PAGES FOLLOW]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
       FIFTH AMENDMENT TO SEVENTH AMENDED AND RESTATED SECURITY AGREEMENT

      IN WITNESS WHEREOF, the Grantor, the Banks and the Agent have caused this
Agreement to be executed by their duly authorized officers, all as of the day
and year first above written.

                           GRANTOR:

                           DIRECT GENERAL FINANCIAL SERVICES, INC., a Tennessee
                           corporation

                           By: /s/ Brian G. Moore
                               ------------------------------------------------
                               Brian G. Moore, President

                           DIRECT GENERAL PREMIUM FINANCE COMPANY, a Tennessee
                           corporation

                           By: /s/ Brian G. Moore
                               ------------------------------------------------
                               Brian G. Moore, President

                           BANKS:

                           FIRST TENNESSEE BANK NATIONAL ASSOCIATION

                           By: /s/ Sam Jenkins
                               ------------------------------------------------
                           Title: SVP

                           HIBERNIA NATIONAL BANK

                           By: /s/  Janet Olson Rack
                               ------------------------------------------------
                           Title: Sr. Vice President

                           U. S. BANK NATIONAL ASSOCIATION

                           By: /s/  Brian Gallagher
                               ------------------------------------------------
                           Title: Vice President

                           CAROLINA FIRST BANK

                           By: /s/  Charles Chamberlain
                               ------------------------------------------------
                           Title: Executive Vice President

                       [SIGNATURE PAGE CONTINUED]

                           BANKS (continued):

                           BANK ONE, NA
                           (Main Office - Chicago, Illinois)

                           By: /s/  Robert D. Bond
                               ------------------------------------------------
                           Title: First Vice President

                           REGIONS BANK

<PAGE>

                           By: /s/  James Schmaltz
                               ------------------------------------------------
                           Title: Vice President

                           NATIONAL CITY BANK OF KENTUCKY

                           By: /s/  Kevin C. Anderson
                               ------------------------------------------------
                           Title: SVP

                           FIFTH THIRD BANK, N.A. (TENNESSEE)

                           By: /s/  David Hicks
                               ------------------------------------------------
                           Title: VP

                           AGENT:

                           FIRST TENNESSEE BANK NATIONAL ASSOCIATION

                           By: /s/ Sam Jenkins
                               ------------------------------------------------
                           Title: SVP

<PAGE>

                                 SIXTH AMENDMENT
                                       TO
                 SEVENTH AMENDED AND RESTATED SECURITY AGREEMENT

      THIS SIXTH AMENDMENT TO SEVENTH AMENDED AND RESTATED SECURITY AGREEMENT
(the "Amendment") made and entered into as of the 3rd day of December, 2004, by
and among DIRECT GENERAL FINANCIAL SERVICES, INC., a Tennessee corporation whose
address is 1281 Murfreesboro Road, Nashville, Tennessee 37217 (f/k/a Direct
Financial Services, Inc.) ("DGFS"), DIRECT GENERAL PREMIUM FINANCE COMPANY, a
Tennessee corporation whose address is 1281 Murfreesboro Road, Nashville,
Tennessee 37217 ("DGPFC"; and collectively with DGFS the "Grantor"), and FIRST
TENNESSEE BANK NATIONAL ASSOCIATION, whose address is 165 Madison Avenue,
Memphis, Tennessee 38103, Attention: Metropolitan Division (in its agency
capacity being herein referred to as "Agent," and in its individual capacity as
"FTBNA"), as agent for itself, and for HIBERNIA NATIONAL BANK, Baton Rouge,
Louisiana ("Hibernia"), and for U. S. BANK NATIONAL ASSOCIATION, St. Louis,
Missouri ("U. S. Bank"), and for REGIONS BANK, Birmingham, Alabama ("Regions"),
and for CAROLINA FIRST BANK, Greenville, South Carolina ("Carolina First"), and
for JPMORGAN CHASE BANK, N.A. (successor by merger to Bank One, NA (Main Office
Chicago)) ("JPMorgan"), Baton Rouge, Louisiana ("Bank One"), and for NATIONAL
CITY BANK OF KENTUCKY, Louisville, Kentucky ("National City Bank"), and for
FIFTH THIRD BANK, N.A. (TENNESSEE), Franklin, Tennessee ("Fifth Third") (Agent,
Hibernia, U. S. Bank, Regions, Carolina First, National City Bank, Fifth Third,
and JPMorgan collectively, the "Banks," and each individually, a "Bank"),
pursuant to the Eighth Amended and Restated Loan Agreement dated as of October
31, 2002, as amended (the "Loan Agreement") among Grantor, Banks and the other
parties named therein.

                                Recitals of Fact

      Pursuant to that certain Seventh Amended and Restated Security Agreement
dated as of October 31, 2002, as amended by that certain First Amendment to
Seventh Amended and Restated Security Agreement dated as of March 31, 2003, as
amended by that certain Second Amendment to Seventh Amended and Restated
Security Agreement dated as of May 28, 2003, as amended by that certain Third
Amendment to the Seventh Amended and Restated Security Agreement dated as of
June 30, 2003, as amended by that certain Fourth Amendment to Seventh Amended
and Restated Security Agreement dated as of November 26, 2003, and as amended by
that certain Fifth Amendment to Seventh Amended and Restated Security Agreement
dated as of June 30, 2004 (as amended, the "Security Agreement"), between DGFS
and the Banks, DGFS and DGPFC assigned and pledged Receivables (as defined in
the Loan Agreement) and other contractual rights to the Agent for the benefit of
the Banks as collateral security for all of the Obligations (as defined in the
Security Agreement) of Grantor to the Banks.

      DGFS, DGPFC and the Banks are now modifying the terms and conditions of
the Loan Agreement by making a Swing Line Loan (as defined in the Loan
Agreement) available to the Grantor. The Grantor and the Banks now desire to
modify certain terms of the Security Agreement as hereinafter set forth.

      NOW, THEREFORE, in consideration of the premises as set forth in the
Recitals of Fact, the mutual covenants and agreements hereinafter set out, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, it is agreed by the parties as follows:

                                   Agreements

      1.    All capitalized terms used and not defined herein shall have the
meaning ascribed to them in the Loan Agreement.

      2.    To induce the Banks to enter into this Amendment, the Grantor does
hereby absolutely and unconditionally, certify, represent and warrant to the
Banks, and covenants and agrees with the Banks, that:

            (a)   It is the intention of DGFS and DGPFC to, and DGFS and DGPFC
                  do hereby, pledge and assign a continuing security interest in
                  the Collateral described in the Security Agreement to Agent as
                  agent for itself and the Banks. References to "Grantor" in the
                  Security Agreement shall be deemed to refer collectively to
                  DGFS and DGPFC.

            (b)   All representations and warranties made by the Grantor in the
                  Loan Agreement, as amended, in the Security Agreement, as
                  amended, and in all other loan documents (all of which are
                  herein sometimes called the "Loan Documents"), are true,
                  correct and complete in all material respects as of the date
                  of this Amendment.

<PAGE>

            (c)   As of the date hereof and with the execution of this
                  Amendment, there are no existing events, circumstances or
                  conditions which constitute, or would, with the giving of
                  notice, lapse of time, or both, constitute Events of Default.

            (d)   There are no existing offsets, defenses or counterclaims to
                  the obligations of the Grantor, as set forth in the Notes, the
                  Security Agreement, the Loan Agreement, as amended, or in any
                  other Loan Document executed by the Grantor, in connection
                  with the Loan.

            (e)   The Grantor does not have any existing claim for damages
                  against the Banks arising out of or related to the Loan; and,
                  if and to the extent (if any) that the Grantor has or may have
                  any such existing claim (whether known or unknown), the
                  Grantor does hereby forever release and discharge, in all
                  respects, the Banks with respect to such claim.

            (f)   The Loan Documents, as amended by this Amendment, are valid,
                  genuine, enforceable in accordance with their respective
                  terms, and in full force and effect.

      3.    Section 2(a) of the Security Agreement, is hereby deleted in its
entirety and the following is inserted in lieu thereof:

            (a)   The full and prompt payment, when due, of the indebtedness
      (and interest thereon) evidenced and to be evidenced by those certain
      promissory notes,

             (i)     Dated as of December 3rd, 2004, in the principal sum of
                     Thirty Million Dollars ($30,000,000.00), executed by
                     Grantor and payable to the order of First Tennessee Bank
                     National Association;

             (ii)    dated as of June 30, 2004, in the principal sum of Forty
                     Million Dollars ($40,000,000.00), executed by Grantor and
                     payable to the order of First Tennessee Bank National
                     Association;

             (iii)   dated as of June 30, 2004, in the principal sum of Twenty
                     Million Dollars ($20,000,000.00), executed by Grantor and
                     payable to the order of Hibernia;

             (iv)    dated as of June 30, 2004, in the principal sum of Thirty
                     Million Dollars ($30,000,000.00), executed by Grantor and
                     payable to the order of U. S. Bank;

             (v)     dated as of June 30, 2004, in the principal sum of
                     Twenty-Five Million Dollars ($25,000,000.00), executed by
                     Grantor and payable to the order of Regions;

             (vi)    dated as of June 30, 2004, in the principal sum of Fifteen
                     Million Dollars ($15,000,000.00), executed by Grantor and
                     payable to the order of Carolina First;

             (vii)   dated as of June 30, 2004, in the principal sum of Fifteen
                     Million Dollars ($15,000,000.00), executed by Grantor and
                     payable to the order of National City Bank;

             (viii)  dated as of June 30, 2004, in the principal sum of Ten
                     Million Dollars ($10,000,000.00), executed by Grantor and
                     payable to the order of Fifth Third; and

             (ix)    dated as of June 30, 2004, in the principal sum of
                     Thirty-Five Million Dollars ($35,000,000.00), executed by
                     Grantor and payable to the order of Bank One (now
                     JPMorgan),

      together with and any and all renewals, modifications, and extensions of
      any of said notes, in whole or in part; and

      4.    All terms and provisions of the Security Agreement, as heretofore
amended, which are inconsistent with the provisions of this Amendment are hereby
modified and amended to conform hereto; and, as so modified and amended, the
Security Agreement is hereby ratified, approved and confirmed. Except as
otherwise may be expressly provided herein, this Amendment shall become
effective as of the date set forth in the initial paragraph hereof.

<PAGE>

      5.    All references in all Loan Documents (including, but not limited to,
the Notes, the Security Agreement, and the Loan Agreement) to the "Security
Agreement" shall, except as the context may otherwise require, be deemed to
constitute references to the Security Agreement as amended hereby.

                        [SEPARATE SIGNATURE PAGES FOLLOW]

<PAGE>

                                 SIGNATURE PAGE
                                       TO
       SIXTH AMENDMENT TO SEVENTH AMENDED AND RESTATED SECURITY AGREEMENT

      IN WITNESS WHEREOF, the Grantor, the Banks and the Agent have caused this
Agreement to be executed by their duly authorized officers, all as of the day
and year first above written.

                         GRANTOR:

                         DIRECT GENERAL FINANCIAL SERVICES, INC., a Tennessee
                         corporation

                         By: /s/  Brian G.  Moore
                             ------------------------------------------------
                             Brian G. Moore, President

                         DIRECT GENERAL PREMIUM FINANCE COMPANY, a Tennessee
                         corporation

                         By: /s/  Brian G.  Moore
                             ------------------------------------------------
                             Brian G. Moore, President

                         BANKS:

                         FIRST TENNESSEE BANK NATIONAL ASSOCIATION

                         By: /s/  Sam Jenkins
                             ------------------------------------------------
                         Title: SVP

                         HIBERNIA NATIONAL BANK

                         By: /s/  Janet Olson Rack
                             ------------------------------------------------
                         Title: Senior Vice President

                         U. S. BANK NATIONAL ASSOCIATION

                         By: /s/  Russell S. Rogers
                             ------------------------------------------------
                         Title: Vice President

                         CAROLINA FIRST BANK

                         By: /s/  Charles Chamberlain
                             ------------------------------------------------
                         Title: Executive Vice President

                   [SIGNATURE PAGE CONTINUED]

                         BANKS (continued):

                         JPMORGAN CHASE BANK, N.A.
                         (successor by merger to Bank One, NA (Main Office
                         Chicago))

                         By: /s/ Robert D. Bond
                             ------------------------------------------------
                         Title: First Vice President

                         REGIONS BANK

<PAGE>

                         By: /s/  James Schmaltz
                             ------------------------------------------------
                         Title: Vice President

                         NATIONAL CITY BANK OF KENTUCKY

                         By: /s/  Kevin C.  Anderson
                             ------------------------------------------------
                         Title: Sr. Vice President

                         FIFTH THIRD BANK, N.A. (TENNESSEE)

                         By: /s/  David Hicks
                             ------------------------------------------------
                         Title: Vice President

                         AGENT:

                         FIRST TENNESSEE BANK NATIONAL ASSOCIATION

                         By: Sam Jenkins
                             ------------------------------------------------
                         Title: SVP