<PAGE>   1
                                                                    EXHIBIT 10.7

                             SECOND AMENDMENT TO THE
                   PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
                               EXCESS BENEFIT PLAN

               (as amended and restated effective January 1, 1988)

         BY THIS AGREEMENT, the Phoenix Home Life Mutual Insurance Company
Excess Benefit Plan (the "Plan"), as amended and restated effective January 1,
1988, is amended by this Second Amendment, effective as provided herein.

         1.       Effective January 1, 1988, Section 4.3 of the Plan is amended
in its entirety to read as follows:

         "No Participant under this Excess Benefit Plan shall have a vested,
         non-forfeitable interest under this Excess Benefit Plan until such
         Participant's satisfaction of one of the following conditions: the
         Participant's attainment of Early Retirement Age under the Employee
         Pension Plan; the Participant's attainment of Normal Retirement Age
         under the Employee Pension Plan; the Participant's becoming Disabled,
         within the meaning given under the Employee Pension Plan; or the
         Participant's death. Any Participant who terminates employment with the
         Employer prior to having satisfied one of the foregoing conditions
         shall have no right to benefits under this Excess Benefit Plan.

         2.       Effective January 1, 1997, Section 9.4 of the Plan is amended
in its entirety to read as follows:

                  (a) Subject to the provisions of paragraph (b) hereof, the
         Participating Employer hereby delegates to the Named Fiduciary the
         right at any time to amend the Plan in accordance with the terms of the
         Plan, provided that any such amendment could not affect the
         Participating Employer's share of the cost of the Plan. If an amendment
         could affect the Participating Employer's share of the cost of the
         Plan, then such amendment shall not be effective with respect to the
         Participating Employer until approved by the Participating Employer.
         Any such amendment shall be adopted by the Participating Employer's
         Benefit Plans Committee unless such amendment could significantly
         affect the Participating Employer's share of the cost of the Plan, as
         determined by the Participating Employer's Benefit Plans Committee, in
         which case such amendment shall be adopted by the Participating
         Employer's Board of Directors in accordance with the Participating
         Employer's Articles of Incorporation, Bylaws and applicable law and
         shall become effective as provided therein upon its execution.

                  (b) No amendment to the Plan shall be effective with respect
         to the Participating Employer until 45 days after a copy of the
         amendment shall have

<PAGE>   2
         been delivered to the Participating Employer, unless the Participating
         Employer shall have waived its right to receive such advance copy of
         the amendment."

         IN WITNESS WHEREOF, this Second Amendment has been executed this
13th day of December, 1996.

                                     Phoenix Home Life Mutual Insurance Company
                                     Benefit Plans Committee


/s/ Ann L. Cowen                     /s/ Carl T. Chadburn
___________________                  __________________________________________
Ann L. Cowen                         Carl T. Chadburn
Witness                              Secretary


                                        2