January 4, 1999

Mr. Brian Kleinberg
357 Oxford Drive
Short Hills, New Jersey 07078

Dear Brian:

      This letter supersedes our prior correspondence with respect to the
commencement date of your employment by Enhance Financial Services Group Inc.
("Enhance") and its subsidiaries, Singer Asset Finance Company L.L.C. and
Enhance Consumer Finance, LLC (jointly, "Singer/ECF") and the compensation
payable to you.

      You shall commence service as Executive Vice President of Enhance and CEO
of Singer/ECF (collectively, the "Company") on the date of this letter. The
period from that date until March 31, 1999 shall constitute a transition period,
during which you shall be required to devote such time as necessary to the
performance of your duties in such capacities but in all events less than 30
hours per week on average. Commencing April 1, 1999, you shall devote all your
business time and effort to the performance of such duties without regard to any
such specific maximum.

      As full compensation for serving in the foregoing capacities you shall
receive the following:

      1.    Base salary at the rate of $300,000 per year.

      2.    An annual target bonus for calendar periods of not less than 50% of
            then base salary, such rate to be increased consistent with the
            Company's senior executive compensation programs, provided that for
            1999 bonus shall equal or exceed $250,000, to be prorated should
            your employment be terminated prior to the expiration to twelve
            months (i) by the Company other than for cause or (ii) by you for
            cause.

      3.    A stock option for 85,000 shares of Enhance common stock pursuant to
            the 1997 Long Term Incentive Plan for Key Employees of Enhance, at
            an exercise price equal to the NYSE closing price of such stock on
            the date of the commencement of your employment. Of said stock
            option, 6,000 shares shall be automatically forfeited to Enhance on
            April 1, 1999 should your predecessor employer, American Express,
            not have communicated to you prior to said date that it has
            conclusively determined you to be ineligible for continued benefits
            under paragraphs 2(b), 2(d) and 4 of your letter severance agreement
            dated December 14, 1998 with said company. 

      4.    A sign-on bonus of $150,000, payable within 30 days after the
            commencement of your employment.
<PAGE>

      5.    Additional compensation based on specific financial goals of
            Singer/ECF as outlined by the Company prior to the commencement of
            your employment and to each anniversary thereof.

      6.    All additional benefits and perquisites made available to other
            senior executive officers of the Company for which you are eligible.

      In addition, you shall participate in the Management Severance Protection
Program of Enhance. For 1999, the "prior year's annual bonus," as contemplated
by and where applicable under such program, shall be equal to the average of the
bonuses awarded to Enhance's executive vice presidents for 1998.

                                                     Very truly yours,


                                                     /s/Elaine Eisenman
                                                     Elaine Eisenman

AGREED TO:


/s/ Brian Kleinberg                   01/28/99
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Brian Kleinberg                         Date


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