## Exhibit 10.1SECOND AMENDMENT TO CREDIT AGREEMENT
     **THIS SECOND  AMENDMENT TO CREDIT  AGREEMENT** (this  "Amendment")  refers to that certain Credit  Agreement dated as of March 3,2000,  as amended  and  restated by that  certain  Amended and  Restated  Credit  Agreement  dated as of May 1, 2001,  as modified  andsupplemented  by that certain  Waiver dated  November 14, 2001,  and that  certain  Waiver dated  February 27, 2002  collectively  (the"Credit Agreement"),  by and between **VESTA INSURANCE GROUP, INC.,** a Delaware corporation ("Vesta"),  **J. GORDON GAINES, INC.,** a Delawarecorporation  ("Gaines")  (Vesta and Gaines may be referred to herein  singularly as the "Borrower" or collectively as the "Borrowers"),and **FIRST COMMERCIAL BANK,** an Alabama banking  corporation (the "Lender").  All capitalized terms used herein without  definition shallhave the same meanings herein as such terms have in the Credit Agreement.
     1.   **Amendments and Waivers.**
     Upon your acceptance  hereof in the space provided for that purpose below and upon  satisfaction  of the conditions  precedentcontained in Section 2 hereof, the Credit Agreement shall be and hereby is amended as follows:
     1.1   Section 1.1 is amended to amend and add the following definitions:
     "Consolidated  Debt to Capital  Ratio" shall mean a percentage in which the numerator is the Debt of                  Vesta and its  Subsidiaries  and the  denominator  of which is the sum of the total capital of Vesta                  and its Subsidiaries plus the Debt of Vesta and its Subsidiaries;  provided,  however,  for purposes                  of "Consolidated  Debt to Capital Ratio",  Debt shall not include  indebtedness of American Founders                  Life Insurance Company to the Federal Home Loan Bank.
                       "Debt" shall mean without  duplication (a) all  indebtedness of such Person for borrowed money,  (b)                  all  Obligations of such Person for the deferred  purchase price of property or services (other than                  trade  payables not overdue by more than ninety (90) days  incurred in the  ordinary  course of such                  Person's business and other than compensation  expenses),  (c) all principal payment  Obligations of                  such Person evidenced by notes, bonds,  debentures or other similar  instruments,  (d) all principal                  payment  Obligations  of such Person  created or arising under any  conditional  sale or other title                  retention  agreement  with respect to the purchase  price of property  acquired by such Person (even                  though  the rights  and  remedies  of the  seller or lender  under  such  agreement  in the event of                  default  are  limited  to  repossession  or sale  of  such  property),  (e)  all  principal  payment                  Obligations of such Person as lessee under capitalized leases, (f) all principal payment  Obligations of such Person in respect of reimbursement for acceptance,  letter of                  credit or similar  facilities,  (g) all  principal  payment  Obligations  of such Person to purchase                  redeem,  retire,  defease or  otherwise  make any  principal  payment  in respect of any  redeemable                  equity  interests in such Person,  valued,  in the case of redeemable  preferred  interests,  at the                  greater of its voluntary or involuntary  liquidation  preference plus accrued and unpaid  dividends,                  (h) all principal payment  Obligations of such Person in respect of hedge agreements,  valued at the                  agreement  value  thereof,  (i)  all  contingent  Obligations  of  such  Person  in  respect  of any                  indebtedness  described in the other clauses of this  definition  of any other  Person,  and (j) all                  indebtedness and other payment  Obligations  referred to in clauses (a) through (i) above of another                  Person  secured by any Lien on  property  (including,  without  limitation,  accounts  and  contract                  rights)  owned by such  Person,  even though  such  Person has not assumed or become  liable for the                  payment of such indebtedness or other payment  Obligations;  provided,  however,  that the amount of                  "Debt"  under  clauses  (i) and (j) shall be the  lesser of (A) the amount of such  indebtedness  or                  other  payment  obligations  of such  other  Person  and (B) in the case of clause  (i),  the actual                  Obligation  of such Person and, in the case of clause  (j),  the fair market  value of the  property                  subject to such Lien (as may be determined by the Borrower in good faith).
     "EBIT" shall mean, for any fiscal  quarter,  the sum determined on a consolidated  basis, of (a) net                  income  (or net  loss),  plus (b)  interest  expense,  plus (c) income  tax  expense  determined  in                  accordance with GAAP.
     "Interest  Coverage Ratio" shall mean for Vesta and its Subsidiaries,  on a consolidated  basis, the                  ratio of (a) EBIT to (b) net cash interest payable on all Debt.
     1.2   Article VI,  **FINANCIAL  COVENANTS**,  is hereby  deleted in its  entirety  and the  following  is  substitutedtherefor:
     **FINANCIAL COVENANTS**
     The Borrower  covenants and agrees that,  until the termination of the commitment and the payment in                  full of all principal  and interest  with respect to the Loans  together with all other amounts then                  due and owing hereunder:
     6.1   **Consolidated  Net  Income.**  Vesta  will  not  permit  cumulative  Consolidated  Net  Income                  (excluding  realized  gains and losses) to be less than the  following  amounts  for the  cumulative                  period corresponding  thereto,  with dollars expressed in millions (calculated  cumulatively for the                  period commencing on January 1, 2002, and ending March 31, 2003):**Fiscal     First     Second     Third   Fourth                   Year      Quarter   Quarter   Quarter  Quarter                 -------------------------------------------------**                   2002       N/A        N/A        N/A     $13                   2003      $14.5       N/A        N/A     N/A
     6.2   **Consolidated  Debt to Capital  Ratio.**  Beginning  with the quarter  ending  June 31,  2002,                  Vesta and its  Subsidiaries  shall  achieve and within  thirty (30) days of the end of each  quarter                  provide  evidence to Lender of the  achievement of a Consolidated  Debt to Capital Ratio of not more                  than forty-five percent (45%).
     6.3   **Credit  Rating.**  Vesta  will at all times  maintain a credit  rating of "B" or  higher,  as                  measured by A. M. Best & Company.
     6.4   **Minimum GAAP Net Worth.**  Vesta will not permit its  consolidated  net worth,  as  calculated  in                  accordance with GAAP, to be less than $225 million.
     6.5   **Interest  Coverage  Ratio.**  Beginning  with the  calendar  year ending  December  31, 2002,                  Vesta shall  achieve and within  forty-five  (45) days of the end of each year  provide  evidence to                  the Lender of the achievement of an Interest Coverage Ratio of not less than 1.5 to 1.0.
     6.6   **Risk-Based  Capital.**  Vesta will not permit  "total  adjusted  capital"  (within the meaning of                  the  Risk-Based  Capital for  Insurers  Model Act as  promulgated  by the NAIC as of the date hereof                  (the  "Model  Act")) of VFIC at any time from and after the  Effective  Date to be less than 150% of                  the  applicable  "Authorized  Control  Level" (within the meaning of the Model Act) for VFIC at such                  time.
     2.   **Conditions precedent.**
     The effectiveness of this Amendment is subject to the satisfaction of all of the following conditions precedent:
     2.1   The Borrowers and the Lender shall have executed and delivered this Amendment.
     2.2   The Lender shall have received copies  (executed or certified,  as may be appropriate) of resolutions of theBorrowers'  boards of directors and all other legal  documents or  proceedings  taken in connection  with the execution and delivery ofthis Amendment to the extent the Lender or its counsel may reasonably request.
     2.3   Legal matters  incident to the execution and delivery of this Amendment  shall be satisfactory to the Lenderand its counsel;  and the Lender shall have  received a favorable  written  opinion of counsel for the  Borrowers in form and substancesatisfactory to the Lender and its counsel.
     3.   **Representations.**
     In order to induce the Lender to execute and deliver this Amendment,  the Borrowers  hereby represent to the Lender that as ofthe date hereof,  the  representations  and warranties set forth in Article IV of the Credit Agreement are and shall be and remain trueand  correct  (except  that the  representations  contained  in  Section  4.11  shall be deemed to refer to the most  recent  financialstatements of the  Borrowers  delivered to the Lender) and (assuming the  effectiveness  of this  Amendment)  the Borrowers are in fullcompliance  with all of the terms and  conditions  of the Credit  Agreement  and no Default or Event of  Default  has  occurred  and iscontinuing under the Credit Agreement or shall result after giving effect to this Amendment.
     4.   **Miscellaneous.**
     4.1   The  Borrowers  hereby  acknowledge  and agree that,  notwithstanding  the  execution  and  delivery of thisAmendment,  the security  interest in the Collateral  granted to the Lender under the Credit Agreement remains in full force and effectand the rights and  remedies  of the  Lender  thereunder,  the  obligations  of the  Borrowers  thereunder  and the liens and  securityinterests  created and  provided  for  thereunder  remain in full force and effect and shall not be  affected,  impaired or  dischargedhereby.  Nothing  herein  contained  shall in any manner affect or impair the priority of the liens and security  interest  created andprovided for by the Credit Agreement as to the indebtedness which would be secured thereby prior to giving effect to this Amendment.
     4.2   Except as  specifically  amended  herein,  the Credit  Agreement  shall continue in full force and effect inaccordance  with its terms, as amended.  Reference to this specific  Amendment need not be made in the Credit  Agreement,  the Note, orany other  instrument or document  executed in connection  therewith,  or in any certificate,  letter or  communication  issued or madepursuant to or with respect to the Credit  Agreement,  any reference in any of such items to the Credit  Agreement being  sufficient torefer to the Credit Agreement as amended hereby.
     4.3   Borrowers  agree to pay on demand all costs and expenses of or incurred by the Lender in connection with thenegotiation, preparation, execution and delivery of this Amendment, including the fees and expenses of counsel for the Lender.
     4.4   This  Amendment may be executed in any number of  counterparts,  and by the  different  parties on differentcounterpart  signature pages,  all of which taken together shall  constitute one and the same agreement.  Any of the parties hereto mayexecuted  this  Amendment  by signing any such  counterpart  and each of such  counterparts  shall for all  purposes be deemed to be anoriginal.  This  Amendment  shall be governed by the laws of the State of Alabama,  without  regard to the conflicts of law  provisionsthereof.
     Dated as of the 30 day of March, 2002.                                   **VESTA INSURANCE GROUP, INC.**                                   By:   */s/   W. Perry Cronin*                                       ___________________________                                   Its:       *CFO*                                      _____________________________                                   **J. GORDON GAINES, INC**                                   By:   */s/   John McCullough*                                       ___________________________                                   Its:       *SVP*                                      _____________________________
     Accepted and agreed to in Birmingham, Alabama, as of the day and date last above written.                                   **FIRST COMMERCIAL BANK**                                   By:   */s/   James Brunstad*                                       ___________________________                                   Its:       *SVP*                                      _____________________________