EXHIBIT 4.12


              TRUST AGREEMENT OF HARLEYSVILLE GROUP CAPITAL TRUST I

         This TRUST AGREEMENT is made as of April 7, 2003 (this "Trust
Agreement"), by and among Harleysville Group Inc., a Delaware corporation, as
Depositor (the "Depositor"), and Wilmington Trust Company, a Delaware banking
corporation, as property trustee (the "Property Trustee") and Wilmington Trust
Company, a Delaware banking corporation, as trustee (the "Delaware Trustee")
(the Property Trustee and the Delaware Trustee are hereinafter collectively
referred to as the "Trustees"). The Depositor and the Trustees hereby agree as
follows:

         1. The trust created hereby shall be known as "Harleysville Group
Capital Trust I" (the "Trust"), in which name the Trustees or the Depositor, to
the extent provided herein, may conduct the business of the Trust, make and
execute contracts, and sue and be sued.

         2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trust the sum of $10. Such amount shall constitute the initial trust estate.
It is the intention of the parties hereto that the Trust created hereby
constitute a statutory trust under Chapter 38 of Title 12 of the Delaware Code,
12 Del. C. ss. 3801, et seq. (the "Statutory Trust Act"), and that this document
constitute the governing instrument of the Trust. The Trustees are hereby
authorized and directed to execute and file a certificate of trust with the
Delaware Secretary of State in such form as the Trustees may approve.

         3. The Depositor and the Trustees expect to enter into an amended and
restated Trust Agreement satisfactory to each such party to provide for the
contemplated operation of the Trust created hereby, the appointment of
Administrative Trustees for the Trust, and the issuance of the Preferred
Securities and Common Securities referred to therein. Prior to the execution and
delivery of such amended and restated Trust Agreement, the Trustees shall not
have any duty or obligation hereunder or with respect of the trust estate,
except as otherwise required by applicable law or as may be necessary to obtain
prior to such execution and delivery any licenses, consents or approvals
required by applicable law or otherwise. Notwithstanding the foregoing, the
Trustees may take all actions deemed proper as are necessary to effect the
transactions contemplated herein.

         4. The Depositor, as depositor of the Trust, is hereby authorized, in
its discretion, (i) to prepare and file with the Securities and Exchange
Commission (the "Commission") and to execute, in the case of the 1933 Act
Registration Statement and 1934 Act Registration Statement (each as herein
defined), on behalf of the Trust, (a) a Registration Statement (the "1933 Act
Registration Statement"), including all pre-effective and post-effective
amendments thereto, relating to the registration under the Securities Act of
1933, as amended (the "1933 Act"), of the Preferred Securities of the Trust, (b)
any preliminary prospectus or prospectus or supplement thereto relating to the
Preferred Securities of the Trust required to be filed pursuant to the 1933 Act,
and (c) a Registration Statement on Form 8-A or other appropriate form (the
"1934 Act Registration Statement"), including all pre-effective and
post-effective amendments thereto, relating to the registration of the Preferred
Securities of the Trust under the Securities Exchange Act of 1934, as amended;


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(ii) if and at such time as determined by the Depositor, to file with the or the
National Association of Securities Dealers ("NASD") or the New York Stock
Exchange or other exchange, and execute on behalf of the Trust a listing
application and all other applications, statements, certificates, agreements and
other instruments as shall be necessary or desirable to cause the Preferred
Securities of the Trust to be listed on the NASD's Nasdaq National Market or the
New York Stock Exchange or other exchange; (iii) to file and execute on behalf
of the Trust, such applications, reports, surety bonds, irrevocable consents,
appointments of attorney for service of process and other papers and documents
that shall be necessary or desirable to register the Preferred Securities of the
Trust under the securities or "Blue Sky" laws of such jurisdictions as the
Depositor, on behalf of the Trust, may deem necessary or desirable; (iv) to
execute and deliver letters or documents to, or instruments for filing with, a
depository relating to the Preferred Securities of the Trust; (v) to execute,
deliver and perform on behalf of the Trust an underwriting agreement with one or
more underwriters relating to the offering of the Preferred Securities of the
Trust; and (vi) to execute on behalf of the Trust such purchase agreements with
one or more purchasers or agents relating to an offering of securities of the
Trust as the Depositor, in its sole discretion on behalf of the Trust, may deem
necessary or desirable.

         In the event that any filing referred to in this Section 4 is required
by the rules and regulations of the Commission, the NASD, the New York Stock
Exchange or other exchange, or state securities or "Blue Sky" laws to be
executed on behalf of the Trust by the Trustees, the Administrative Trustees, in
their capacity as trustees of the Trust, are hereby authorized to join in any
such filing and to execute on behalf of the Trust any and all of the foregoing.

         5. This Trust Agreement may be executed in one or more counterparts.

         6. The number of trustees of the Trust initially shall be two and
thereafter the number of trustees of the Trust shall be such number as shall be
fixed from time to time by a written instrument signed by the Depositor which
may increase or decrease the number of trustees of the Trust; provided, however,
that to the extent required by the Statutory Trust Act, one trustee of the Trust
shall either be a natural person who is a resident of the State of Delaware or,
if not a natural person, an entity which has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable
Delaware law. Subject to the foregoing, the Depositor is entitled to appoint or
remove without cause any trustee of the Trust at any time. Any trustee of the
Trust may resign upon thirty days' prior notice to the Depositor.

         7. Wilmington Trust Company, in its capacity as Delaware Trustee, shall
not have the powers or duties of the Trustees set forth herein (except as may be
required under the Statutory Trust Act) and shall be a trustee hereunder for the
sole and limited purpose of fulfilling the requirements of Section 3807(a) of
the Statutory Trust Act.

         8. The Trust may be dissolved and terminated before the issuance of the
Preferred Securities at the election of the Depositor.

         9. (a) The Trustees and their officers, directors, agents and servants
(collectively, the "Fiduciary Indemnified Persons") shall not be liable,
responsible or accountable in damages or otherwise to the Trust, the Depositor,
the Trustees or any holder of the Preferred Securities (the Trust, the

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Depositor, the Trustees and any holder of the Trust Securities being a "Covered
Person") for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by the Fiduciary Indemnified Persons in good faith on
behalf of the Trust and in a manner the Fiduciary Indemnified Persons reasonably
believed to be within the scope of authority conferred on the Fiduciary
Indemnified Persons by this Trust Agreement or by law, except that the Fiduciary
Indemnified Persons shall be liable for any such loss, damage or claim incurred
by reason of the Fiduciary Indemnified Person's negligence, bad faith or willful
misconduct with respect to such acts or omissions.

                  (b) The Fiduciary Indemnified Persons shall be fully protected
in relying in good faith upon the records of the Trust and upon such
information, opinions, reports or statements presented to the Trust by any
person as to matters the Fiduciary Indemnified Persons reasonably believe are
within such other person's professional or expert competence and who has been
selected with reasonable care by or on behalf of the Trust, including
information, opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts pertinent to the
existence and amount of assets from which distributions to holders of Preferred
Securities might properly be paid.

                  (c) The Depositor agrees, to the fullest extent permitted by
applicable law, (i) to indemnify and hold harmless each Fiduciary Indemnified
Person, or any of its respective officers, directors, shareholders, employees,
representatives or agents, from and against any loss, damage, liability, tax,
penalty, expense or claim of any kind or nature whatsoever incurred by the
Fiduciary Indemnified Persons by reason of the creation, operation or
termination of the Trust in a manner the Fiduciary Indemnified Persons
reasonably believed to be within the scope of authority conferred on the
Fiduciary Indemnified Persons by this Trust Agreement, except that no Fiduciary
Indemnified Persons shall be entitled to be indemnified in respect of any loss,
damage or claim incurred by the Fiduciary Indemnified Persons by reason of
negligence, bad faith or willful misconduct with respect to such acts or
omissions, and (ii) to advance expenses (including reasonable legal fees)
incurred by a Fiduciary Indemnified Person in defending any claim, demand,
action, suit or proceeding, from time to time, prior to the final disposition of
such claim, demand, action, suit or proceeding, upon receipt by the Trust of an
undertaking by or on behalf of such Fiduciary Indemnified Persons to repay such
amount if it shall be determined that such Fiduciary Indemnified Person is not
entitled to be indemnified as authorized in the preceding subsection.

                  (d) The provisions of this Section 9 shall survive the
termination of this Trust Agreement or the earlier resignation or removal of the
Fiduciary Indemnified Persons.

         10. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).




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         IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed as of the day and year first above written.

                                          HARLEYSVILLE GROUP INC., as Depositor


                                          By:  /s/ Mark R. Cummins
                                          --------------------------------
                                          Name:  Mark R. Cummins
                                          Title: Executive Vice President,
                                          CIO and Treasurer


                                          WILMINGTON TRUST COMPANY, not in its
                                          individual capacity, but solely as
                                          Property Trustee


                                          By: /s/ Kathleen A. Pedelini
                                          -------------------------------------
                                          Name: Kathleen A. Pedelini
                                          Title: Financial Services Officer


                                          WILMINGTON TRUST COMPANY, not in its
                                          individual capacity, but solely as
                                          Delaware Trustee


                                          By: /s/ Kathleen A. Pedelini
                                          -------------------------------------
                                          Name: Kathleen A. Pedelini
                                          Title: Financial Services Officer