Exhibit 10.3













                              (1) SARAH ANN DAVIES


                                       AND


                     (2) ASPEN INSURANCE UK SERVICES LIMITED

                      (3) ASPEN INSURANCE HOLDINGS LIMITED



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                     AMENDED AND RESTATED SERVICE AGREEMENT

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                                TABLE OF CONTENTS



CLAUSE                                                                                                         PAGE

1.       INTERPRETATION...........................................................................................1

2.       AMENDMENT AND RESTATEMENT................................................................................2

3.       POSITION.................................................................................................2

4.       TERM.....................................................................................................2

5.       DUTIES...................................................................................................2

6.       REMUNERATION AND COMMISSION..............................................................................3

7.       PENSION AND INSURANCE BENEFITS...........................................................................4

8.       EXPENSES.................................................................................................5

9.       HOLIDAYS AND HOLIDAY PAY.................................................................................5

10.      DISABILITY OR DEATH......................................................................................5

11.      CONFIDENTIAL INFORMATION.................................................................................6

12.      COPYRIGHT AND DESIGNS....................................................................................6

13.      GRATUITIES AND CODES OF CONDUCT..........................................................................7

14.      RESTRICTIVE COVENANTS....................................................................................7

15.      TERMINATION BY RECONSTRUCTION OR AMALGAMATION; CHANGE IN CONTROL.........................................9

16.      TERMINATION OF EMPLOYMENT BY THE COMPANY FOR CAUSE......................................................10

17.      TERMINATION OF EMPLOYMENT BY THE COMPANY WITHOUT CAUSE..................................................11

18.      TERMINATION OF EMPLOYMENT BY THE EXECUTIVE............................................................. 11

19       OBLIGATIONS UPON TERMINATION OF EMPLOYMENT; CERTAIN OTHER TERMINATIONS...............  .................12

20.      EFFECT OF TERMINATION OF THIS AGREEMENT.................................................................14

21.      GENERAL RELEASE.........................................................................................15

22.      OTHER TERMS AND CONDITIONS..............................................................................15

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22.      NOTICES.................................................................................................16

24.      PREVIOUS AND OTHER AGREEMENTS...........................................................................16

25.      ENTIRE AGREEMENT/AMENDMENT..............................................................................16

26.      ASSIGNMENT..............................................................................................16

27.      SEVERABILITY............................................................................................17

28.      SUCCESSORS/BINDING AGREEMENT............................................................................17

29.      COOPERATION.............................................................................................17

30.      GOVERNING LAW...........................................................................................17

31.      COUNTERPARTS............................................................................................17




                     AMENDED AND RESTATED SERVICE AGREEMENT

DATE:          24 September 2004

PARTIES:

(1)      SARAH ANN DAVIES of Hollybush Cottages, 1 Hollybush Lane, Bendish,
         Whitwell, Hertfordshire SG4 8JB (the "Executive");

(2)      ASPEN INSURANCE UK SERVICES LIMITED (Registered in England No.
         1184193), 100 Leadenhall Street, London, EC3A 3DD, England (formerly
         known as Wellington Re Services Limited) (the "Company"); and

(3)      ASPEN INSURANCE HOLDINGS incorporated in the Islands of Bermuda whose
         registered office is at Cedar Avenue, Hamilton, Bermuda ("Holdings").

OPERATIVE TERMS:

         1.       INTERPRETATION

         1.1      In this Agreement:

         "Affiliate"                          means any entity directly or
                                              indirectly controlling, controlled
                                              by, or under common control with
                                              Holdings; or any other entity
                                              designated by the Board of
                                              Holdings in which Holdings or an
                                              Affiliate has an interest.

         "Board"                              means the Board of Directors of
                                              the Company from time to time;

         "Board of Holdings"                  means the Board of Directors of
                                              Holdings from time to time; and

         "Group"                              means Aspen Insurance Holdings
                                              Limited and its Affiliates (and
                                              "Group Company" means Holdings or
                                              any one of its Affiliates).

         1.2      In this Agreement references to any statutory provision shall
         include such provision as from time to time amended, whether before on
         or (in the case of re-enactment or consolidation only) after the date
         hereof, and shall be deemed to include provision of earlier legislation
         (as from time to time amended) which have been reenacted (with or
         without modification) or replaced (directly or indirectly) by such
         provision and shall further include all statutory instruments or orders
         from time to time made pursuant thereto.




         2.       AMENDMENT AND RESTATEMENT

         This Agreement shall serve as a complete amendment and restatement of
         the Service Agreement entered into between Sarah Ann Davies and
         Wellington Re Services Limited, dated 21 June 2002 (the "Original
         Agreement"). Except as otherwise provided herein, all terms of the
         Original Agreement shall be superceded by the terms of this Agreement
         and, upon execution of this Agreement, the Original Agreement shall be
         of no further force and effect.

         3.       POSITION

         The Company shall employ the Executive as Executive Vice President,
         Chief Operating Officer and a member of the Board. The Executive shall
         also be appointed as Executive Vice President, Chief Operating Officer
         of Holdings. In addition, the Executive shall also be nominated to
         serve as a director of such other Group Companies, which shall include
         Aspen Insurance UK Limited, as mutually agreed to by the Executive and
         the Board of Holdings (which nomination shall be subject to approval by
         the shareholders of such Group Company in accordance with the
         organizational documents thereof).

         4.       TERM

         4.1      The Company shall employ the Executive, and the Executive
         shall serve the Company, on the terms and conditions set forth in this
         Agreement, for the period beginning on the date hereof (the "Effective
         Date") and ending on the second anniversary of the Effective Date (the
         "Term"); provided, however, that commencing on the Effective Date and
         on each succeeding day thereafter, unless previously terminated, the
         Term shall be automatically extended by one additional day.

         4.2      Notwithstanding the provisions of Clause 4.1, the Executive's
         employment shall terminate automatically when the Executive reaches the
         age of 65 years.

         5.       DUTIES

         5.1      During her employment hereunder the Executive shall:

                  (a) report to the Board and perform the duties and exercise
                  the powers and functions which from time to time may
                  reasonably be assigned to or vested in her by the Chief
                  Executive Officer in relation to the Company and any other
                  Group Company to the extent consistent with her job title set
                  out in Clause 3 (without being entitled to any additional
                  remuneration in respect of such duties for any Group Company);

                  (b) devote the whole of her working time, attention and
                  ability to her duties in relation to the Company and any other
                  Group Company at such place or places as the Board shall
                  determine. The Executive shall work at the Company's premises
                  at 100 Leadenhall Street, London EC3A 3DD, or such other place
                  as the Company and the Executive shall mutually agree,
                  provided that the Executive shall not be required to reside
                  outside the United Kingdom;

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                  (c) comply with all reasonable requests, instructions and
                  regulations given or made by the Board (or by any one
                  authorised by it) and promptly provide such explanations,
                  information and assistance as to the performance of her duties
                  assigned to her under this Agreement as the Chief Executive
                  Officer may reasonably require;

                  (d) faithfully and loyally serve the Company and each other
                  Group Company to the best of her ability and use her utmost
                  endeavours to promote its interests in all respects;

                  (e) not engage in any activities which would detract from the
                  proper performance of her duties hereunder, nor without the
                  prior written consent of the Board or the Board of Holdings in
                  any capacity including as director, shareholder, principal,
                  consultant, agent, partner or employee of any other company,
                  firm or person (save as the holder for investment of
                  securities which do not exceed three percent (3%) in nominal
                  value of the share capital or stock of any class of any
                  company quoted on a recognised stock exchange) engage or be
                  concerned or interested directly or indirectly in any other
                  trade, business or occupation whatsoever; and

                  (f) comply (and shall use every reasonable endeavour to
                  procure that her spouse and minor children will comply) with
                  all applicable rules of law, stock exchange regulations,
                  individual registration requirements (at a cost to be borne by
                  the Company) and codes of conduct of the Company and any other
                  Group Company in effect with respect to dealing in shares,
                  debentures or other securities of the Company or other Group
                  Company.

         5.2      Nothing herein shall preclude the Executive from (a) serving
         on the boards of directors of a reasonable number of other corporations
         subject to the approval of the Board or the Board of Holdings in each
         case (which approval has been given as to the boards listed in Exhibit
         A attached hereto), which approval shall not be unreasonably withheld,
         (b) serving on the boards of a reasonable number of trade associations
         subject to the approval of the Board or the Board of Holdings, which
         approval shall not unreasonably be withheld, and/or charitable
         organizations, (c) engaging in any charitable activities and community
         affairs, and (d) managing her personal investments and affairs,
         provided that such activities set forth in this Clause 5.2 do not
         significantly interfere with the performance of her duties and
         responsibilities to any Group Company.

         6. REMUNERATION AND COMMISSION

         6.1       The Executive shall be paid by way of remuneration for her
         services during her employment hereunder a salary at the rate (the
         "Salary Rate") of (pound)180,000 per annum, subject to increase
         pursuant to Clause 6.3, which shall be inclusive of any fees to which
         the Executive may be entitled as a director of the Company or of any
         other Group Company.

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         6.2      The Executive shall be eligible for a cash bonus during her
         employment hereunder of such amounts (if any) at such times and subject
         to such conditions as the Compensation Committee of the Board of
         Holdings (the "Compensation Committee") may in its absolute discretion
         decide; provided, however, that notwithstanding the preceding language
         of this Clause 6.2, the Executive shall participate in all management
         incentive plans made available to the Company's senior executives at a
         level commensurate with Executive's status and position at the Company.

         6.3      The Company shall review the Salary Rate for increase at least
         once each year, and any change in the Salary Rate resulting from such
         review will take effect from 1 April. The Company's review shall take
         into consideration, among other factors, the base salary paid to
         individuals performing similar services at comparable companies based
         in Bermuda, the United Kingdom and the United States, as well as other
         relevant local or global talent pool comparables, it being expressly
         understood that while it is intended that the Company shall consider
         these factors, it shall have no obligation to take any specific action
         based on such factors.

         6.4      The Executive's salary will be payable by equal monthly
         installments; each monthly installment will be in respect of a calendar
         month and will be paid on or before the last day of such calendar
         month. Where the employment has begun or ended in a calendar month,
         salary in respect of that month will be the proportion of a normal
         month's installment which the days of employment in that month bear to
         the total days in the month.

         6.5      The Company may withhold from amounts payable under this
         Agreement all applicable taxes that are required to be withheld by
         applicable laws or regulations.

         7.       PENSION AND INSURANCE BENEFITS

         7.1      During her employment hereunder, the Executive shall continue
         to be a member of the pension scheme established by the Board (the
         "Scheme"). The Executive's membership in the Scheme shall be subject to
         the provisions thereof as may be amended from time to time.

         7.2      During her employment hereunder, the Executive shall be
         entitled to participate in all employee benefit and perquisite plans
         and programs made available to the Company's senior level executives or
         to its employees generally, as such plans or programs may be in effect
         from time to time.

         7.3      During her employment hereunder, the Company shall provide the
         Executive with medical insurance, permanent health insurance, personal
         accident insurance and life insurance (subject to the relevant
         insurers' terms and conditions). The Board shall have the right to
         change the arrangements for the provision of such benefits as it sees
         fit or, if in the reasonable opinion of the Board, the Company is
         unable to secure any such insurance under the rules of any applicable
         scheme or otherwise at reasonable rates to cease to provide any or all
         of the insurances.

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         8.      EXPENSES

         The Company shall reimburse to the Executive all traveling, hotel,
         entertainment and other expenses properly and reasonably incurred by
         her in the performance of her duties hereunder and properly claimed and
         vouched for in accordance with the Company's expense reporting
         procedure in force from time to time.

         9.      HOLIDAYS AND HOLIDAY PAY

         9.1      In addition to public holidays in England, during her
         employment hereunder, the Executive shall be entitled to 30 working
         days' paid holiday per holiday year and, if applicable, such additional
         days as are set out in the Company's standard terms and conditions of
         employment from time to time, during each holiday year to be taken at
         such time or times as are convenient to the Company. Except as
         otherwise provided in the Company's holiday policy, the Executive may
         not carry forward any unused part of her holiday entitlement to a
         subsequent holiday year and the Executive shall not be entitled to any
         salary in lieu of untaken holiday.

         9.2      For the holiday year during which the Executive's employment
         hereunder commences or terminates she shall be entitled to such
         proportion of her annual holiday entitlement as the period of her
         employment in each such holiday year bears to one holiday year as set
         out in the Company's holiday policy. Upon termination of this
         employment for whatever reason, she shall, if appropriate, be entitled
         to salary in lieu of any outstanding holiday entitlement.

         10.      DISABILITY OR DEATH

         10.1     The Company reserves the right at any time to require the
         Executive (at the expense of the Company) to be examined by a medical
         adviser nominated by the Company and the Executive consents to the
         medical adviser disclosing the results of the examination to the
         Company and shall provide the Company with such formal consents as may
         be necessary for this purpose.

         10.2     If the Executive shall be prevented by illness, accident or
         other incapacity from properly performing her duties hereunder she
         shall report this fact forthwith to the Company Secretary's office and
         if she is so prevented for seven or more consecutive days she shall if
         required by the Company provide an appropriate doctor's certificate.

         10.3     If the Executive shall be absent from her duties hereunder
         owing to illness, accident or other incapacity duly certified in
         accordance with the provisions of clause 10.2 she shall be paid her
         full remuneration for any period of absence of up to a maximum of 26
         weeks in aggregate in any period of 52 consecutive weeks and
         thereafter, subject to the provisions of clause 16, to such
         remuneration (if any) as the Board shall in its absolute discretion
         allow.

         10.4     If the Executive shall be, on the basis of a medical report
         supplied to the Company following her having undergone a medical
         examination pursuant to clause 10.1, in the opinion of the Board unfit
         ever to return to her duties (but in such

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         circumstances and prior to any action being taken under this clause,
         the Executive shall have the right to have a second medical report from
         a duly qualified doctor or medical adviser selected by the Executive
         and approved by the Board, which approval shall not be unreasonably
         withheld) the Company shall be entitled to place the Executive on
         permanent sick leave without pay or benefits (other than permanent
         health insurance benefits) with effect from any time on or after the
         commencement of payments under the permanent health insurance
         arrangements referred to in clause 7.3.

         10.5     In the event that the Executive's employment is terminated due
         to her death, her estate or her beneficiaries, as the case may be,
         shall be entitled to: (a) salary at her Salary Rate through the end of
         the month in which in which her death occurs, (b) the annual incentive
         award, if any, that the Executive would have been entitled to pursuant
         to Clause 6.2 for the year in which the Executive's death occurs,
         multiplied by a fraction, the numerator of which is the number of days
         that the Executive was employed during the applicable year and the
         denominator of which is 365, and (c) the unpaid balance of all
         previously earned cash bonus and other incentive awards with respect to
         performance periods which have been completed, all of which amounts
         shall be payable in a lump sum in cash within 30 days after her death,
         except that the pro-rated incentive award shall be payable when such
         award would have otherwise been payable had the Executive's employment
         not terminated.

         11.      CONFIDENTIAL INFORMATION

                  The Executive shall not during her employment hereunder or at
         any time after her termination for any reason whatsoever (except (i)
         for the benefit of the Company or any other Group Company in the course
         of her employment or membership on the Board or the Board of Holdings
         (ii) if compelled by a court or administrative order in which case the
         Executive may do so only to the extent legally required and only if she
         has promptly notified the Company of such order and cooperated fully
         with the Company to protect such information) disclose to any person
         whatsoever or otherwise make use of (and she shall at all times
         exercise all due care and diligence to prevent the unauthorised
         disclosure or use of) any confidential or secret information which she
         has or may have acquired in the course of her employment relating to
         the Company or any other Group Company or any customers or clients of
         the Company or any other Group Company, including without limiting the
         generality of the foregoing confidential or secret information relating
         to the past, current or future business, finances, activities and
         operations of the Company or any other Group Company and/or any third
         party to the extent that such information was obtained by the Company
         or any other Group Company pursuant to a confidentiality agreement, but
         excluding information that is generally known to, or recognized as
         standard practice in, the industry in which the Company is engaged
         unless such information is known or recognized as a result of the
         Executive's breach of this covenant (referred to herein as
         "Confidential Information").

         12.      COPYRIGHT AND DESIGNS

         12.1     The Executive hereby assigns to the Company all present and
         future copyright, design rights and other proprietary rights if any for
         the full term thereof throughout the

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         world in respect of all works originated by her at any time during the
         period of her employment by the Company or any other Group Company
         whether during the course of her normal duties or other duties
         specifically assigned to her (whether or not during normal working
         hours) either alone or in conjunction with any other person and in
         which copyright or design rights may subsist except only those designs
         or other works written, originated, conceived or made by her wholly
         unconnected with her service hereunder.

         12.2     The Executive agrees and undertakes that she will execute such
         deeds or documents and do all such acts and things as may be necessary
         or desirable to substantiate the rights of the Company in respect of
         the matters referred to in this Clause. To secure her obligation under
         this Agreement the Executive irrevocably appoints the Company to be her
         attorney in her name and on her behalf to execute such deeds or
         documents and do all such acts and things as may be necessary or
         desirable to substantiate the rights of the Company in respect of the
         matters referred to in this Clause.

         12.3     The Executive hereby irrevocably waives all moral rights that
         she had or may have in any of the works referred to in Clause 12.1,
         subject to the exception therein.

         13. GRATUITIES AND CODES OF CONDUCT

         13.1     The Executive shall comply with all codes of conduct from time
         to time adopted by the Board or the Board of Holdings.

         13.2     The Executive shall not, except in accordance with any code of
         conduct adopted by the Board and the Board of Holdings or with the
         prior written consent of the Board or the Board of Holdings, directly
         or indirectly accept any commission, rebate, discount, gratuity or
         gift, in cash or in kind from any person who has or is likely to have a
         business relationship with the Company or any other Group Company and
         shall notify the Company upon acceptance by the Executive of any
         commission, rebate, discount, gratuity or gift in accordance with any
         such code of conduct from time to time.

         14. RESTRICTIVE COVENANTS

         14.1     For the purpose of this Clause:

         "THE BUSINESS" means the business of the Group or any Group Company at
         the date of termination of the Executive's employment with which the
         Executive has been concerned to a material extent at any time in the
         Relevant Period;

         references to the "GROUP" and "GROUP COMPANIES" shall only be reference
         to the Group and Group Companies in respect of which the Executive has
         carried out material duties in the Relevant Period ;

         "RELEVANT PERIOD" shall mean the period of 24 months immediately
         preceding the date of termination of the Executive's employment or, in
         the event that the Company exercises all or any of its rights under
         Clause 18.3, the period of 24 months immediately preceding the date on
         which it exercises such rights;

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         "RESTRICTED PERSON" shall mean any person who or which has at any time
         during the Relevant Period done business with the Company or any other
         Group Company as customer or client or consultant and whom or which the
         Executive shall have had personal dealings with, contact with or
         responsibility for (each, in a business or commercial capacity) during
         the Relevant Period;

         "KEY EMPLOYEE" shall mean any person who at the date of termination of
         the Executive's employment is employed or engaged by the Company or any
         other Group Company with whom the Executive has had material contact
         during the Relevant Period and (a) is employed or engaged in the
         capacity of Manager, Underwriter or otherwise in a senior capacity or
         in any other capacity as may be agreed in writing between the Executive
         Committee and the Executive from time to time and/or (b) is in the
         possession of Confidential Information and/or (c) is directly managed
         by or reports to the Executive.

         14.2     The Executive covenants with the Company that she will not in
         connection with the carrying on of any business in competition with the
         Business during her employment and, in the event of resignation by the
         Executive with Good Reason or dismissal of the Executive by the Company
         (whether with or without Cause) for the period of 12 months after the
         termination of her employment without the prior written consent of the
         Board of Holdings either alone or jointly with or on behalf of any
         person directly or indirectly:

         14.2.1   canvass, solicit or approach or cause to be canvassed or
         solicited or approached for orders in respect of any services provided
         and/or any products sold by the Company or any other Group Company any
         Restricted Person;

         14.2.2   solicit or entice away or endeavour to solicit or entice away
         from the Company or any other Group Company any Key Employee.

         14.3     The Executive further covenants that in the event of
         resignation by the Executive with Good Reason or dismissal of the
         Executive by the Company without Cause under the provisions of Clause
         17.1(ii), she will not in connection with the carrying on of any
         business in competition with the Business for the further period of 12
         months following the first anniversary of the date of termination of
         the Executive's employment, without the prior written consent of the
         Board of Holdings, either alone or jointly with or on behalf of any
         person directly or indirectly (a) canvass, solicit or approach or cause
         to be canvassed or solicited or approached for orders in respect of any
         services provided and/or any products sold by the Company or any other
         Group Company any Restricted Person; or (b) solicit or entice away or
         endeavour to solicit or entice away from the Company or any other Group
         Company any Key Employee.

         14.4     The Executive further covenants with the Company that, in the
         event of resignation by the Executive with Good Reason she will not,
         for the period of 12 months after the termination of her employment, be
         employed, engaged, interested in or concerned with any business or
         undertaking which is engaged in or carries on business in the United
         Kingdom, Bermuda or the USA which is or is about to be in competition
         with the Business;

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         14.5     The covenants contained in Clauses 14.2.1, 14.2.2 ,14.3 and
         14.4 are intended to be separate and severable and enforceable as such.
         It is expressly understood and agreed that although the Executive and
         the Company consider the restrictions contained in this Clause 14 to be
         reasonable, if a final judicial determination is made by a court of
         competent jurisdiction that the time or territory or any other
         restriction contained in this Agreement is an unenforceable restriction
         against the Executive, the provisions of this Agreement shall not be
         rendered void but shall be deemed amended to apply as to such maximum
         time and territory and to such maximum extent as such court may
         judicially determine to be enforceable. Alternatively, if any court of
         competent jurisdiction finds that any restriction contained in this
         Agreement is unenforceable, and such restriction cannot be amended so
         as to make it enforceable, such finding shall not affect the
         enforceability of any of the other restrictions contained herein.

         14.6     The Executive acknowledges and agrees that the Company's
         remedies at law for a breach of any of the provisions of Clause 11, 12
         or 14 would be inadequate and the Company would suffer irreparable
         damages as a result of such breach. In recognition of this fact, the
         Executive agrees that, in the event of such a breach, in addition to
         any remedies at law, the Company, without posting any bond, shall be
         entitled to obtain equitable relief in the form of specific
         performance, temporary restraining order, temporary or permanent
         injunction or any other equitable remedy which may then be available.

         15. TERMINATION BY RECONSTRUCTION OR AMALGAMATION; CHANGE IN CONTROL

         15.1     If the employment of the Executive hereunder shall be
         terminated solely by reason of the liquidation of the Company for the
         purposes of amalgamation or reconstruction or as part of any
         arrangement for the amalgamation of the undertaking of the Company not
         involving liquidation (in each case, other than a "Change in Control",
         as defined below) and the Executive shall be offered employment with
         the amalgamated or reconstructed company on the same terms as the terms
         of this Agreement (including as to the continuation of any directorship
         which she may then hold in the Company or any other Group Company), the
         Executive shall have no claim against the Company or Holdings in
         respect of the termination of her employment by the Company.

         15.2     If the employment of the Executive hereunder shall be
         terminated by the Company without Cause or by the Executive with Good
         Reason within the six-month period prior to a Change in Control or
         within the two-year period after a Change in Control, in addition to
         the benefits provided in Clause 19.2, the Executive shall be entitled
         to the following benefits: (a) other than share options and other
         equity-based awards granted prior to the date of this Agreement, which
         shall vest and be exercisable in accordance with the terms of their
         grant agreements, all share options and other equity-based awards shall
         immediately vest and remain exercisable for the remainder of their
         terms; and (b) (i) if the aggregate of all payments or benefits made or
         provided to the Executive under this Agreement and under all other
         plans and programs of the Company exceeds 2.99 times the Executive's
         "base amount", as defined in Section 280(b)(3) of the Internal Revenue
         Code of 1986, as amended (the "Code"), (the "Executive Limit

                                       9


         Amount"), by 10% or less of such Executive Limit Amount, the amounts
         constituting "parachute payments" within the meaning of Section
         280G(b)(2) (the "Parachute Amount") which would otherwise be payable to
         or for the benefit of the Executive shall be reduced to the extent
         necessary so that the Parachute Amount is equal to the Executive Limit
         Amount; or (ii) if the aggregate of all payments or benefits made or
         provided to the Executive under this Agreement and under all other
         plans and programs of the Company exceeds the Executive Limit Amount by
         more than 10% of such Executive Limit Amount, the Company shall pay to
         the Executive, as and when any excise tax imposed by Section 4999 of
         the Code is payable with respect to such payment, an additional amount
         which, after the imposition of all income, employment, excise and other
         taxes thereon, is equal to the excise tax imposed on such payment.

         For purposes of this Agreement, "Change in Control" shall have the same
         meaning as under the Aspen Insurance Holdings 2003 Share Incentive Plan
         as in effect as of the date hereof.

         16. TERMINATION OF EMPLOYMENT by the company FOR CAUSE

         16.1     The Company, without prejudice to any remedy which it may have
         against the Executive for the breach or non-performance of any of the
         provisions of this Agreement, may by notice in writing to the Executive
         forthwith terminate her employment for "Cause". In the event the
         Company terminates the Executive's employment for Cause, the Executive
         shall be entitled to salary at her Salary Rate through the date of
         termination.

         For purposes of this Agreement, "Cause" shall mean circumstances where
         the Executive:

                  (a) becomes bankrupt or becomes the subject of an interim
                  order under the Insolvency Act 1986 or makes any arrangement
                  or composition with her creditors; or

                  (b) is convicted of any criminal offence (other than an
                  offence under road traffic legislation in the United Kingdom
                  or elsewhere for which a penalty other than imprisonment is
                  imposed); or

                  (c) is guilty of any serious misconduct, any conduct tending
                  to bring the Company Holdings, any other Group Company or
                  herself into disrepute, or any material breach or
                  non-observance of any of the provisions of this Agreement, or
                  conducts herself in a way which is materially prejudicial or
                  calculated to be materially prejudicial to the business of the
                  Group; or

                  (d) is disqualified from being a director of any company by
                  reason of an order made by any competent court; or

                  (e) is guilty of any repeated breach or non-observance of any
                  code of conduct or fails or ceases to be registered (where
                  such registration is, in the reasonable opinion of the Board
                  or the Board of Holdings, required for the performance of her
                  duties) by any regulatory body in the United Kingdom or
                  elsewhere.

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         17.       TERMINATION OF THE EMPLOYMENT BY THE COMPANY WITHOUT CAUSE

         17.1     The Company may terminate the employment of the Executive at
         any time during the Term without Cause by either (i) giving to the
         Executive 12 months' prior notice in writing; or (ii) terminating the
         employment of the Executive immediately and paying the Executive in
         lieu of the notice to which she would have otherwise been entitled
         under (i) above (which payment in lieu shall be deemed to be included
         within the payment referred to in Clause 19.2).

         18.      TERMINATION OF EMPLOYMENT BY THE EXECUTIVE

         18.1     The Executive shall have the right to terminate her employment
         at any time for Good Reason by immediate notice if, following
         submission of the written notice by the Executive to the Company
         detailing the events alleged to constitute Good Reason in accordance
         with this Clause, the Company shall have failed to cure such events
         within the 30 day period following submission of such notice. For
         purposes of this Agreement, "Good Reason" shall mean (i) a reduction in
         the Executive's annual base salary or annual bonus opportunity, or the
         failure to pay or provide the same when due, (ii) a material diminution
         in the Executive's duties, authority, responsibilities or title, or the
         assignment to the Executive of duties or responsibilities which are
         materially inconsistent with her positions (whether in relation to the
         Executive's appointments with the Company or Holdings), (iii) the
         failure to elect or reelect the Executive to any of the positions
         described in Clause 3 or the removal of her from any such position,
         (iv) an adverse change in the Executive's reporting relationship, or
         (v) the Company's requiring the Executive to be based at any office or
         location more than fifty (50) miles from the Executive's office as of
         the date hereof; provided, however, that no such event(s) shall
         constitute "Good Reason" unless the Company (or Holdings, where
         appropriate) shall have failed to cure such event(s) within 30 days
         after receipt by the Company from the Executive of written notice
         describing in detail such event(s).

         18.2     The Executive shall have the right to terminate her employment
         at any time without Good Reason upon giving 12 months' prior written
         notice to the Company.

         18.3     If the Executive gives notice to terminate her employment
         without Good Reason under Clause 18.2 or if the Executive seeks to
         terminate her employment without Good Reason and without the notice
         required by Clause 18.2 or the Company gives notice to terminate the
         Executive's employment under Clause 17.1(i), then provided the Company
         continues to provide the Executive with the salary and contractual
         benefits in accordance with this Agreement, the Company has, at its
         discretion, the right for the period (the "Garden Leave Period") then
         outstanding until the date of the termination of the Executive's
         employment:

                  (a) to exclude the Executive from any premises of the Company
                  or any Group Company and require the Executive not to attend
                  at any premises of the Company or any Group Company; and/or


                                       11


                  (b) to require the Executive to carry out no duties; and/or

                  (c) to require the Executive not to communicate or deal with
                  any employees, agents, consultants, clients or other
                  representatives of the Company or any other Group Company;
                  and/or

                  (d) to require the Executive to resign with immediate effect
                  from any offices she holds with the Company or any other Group
                  Company (and any related trusteeships); and/or

                  (e) to require the Executive to take any holiday which has
                  accrued under clause 9 during the Garden Leave Period.

         The Executive shall continue to be bound by the duties set out in
         Clause 5 (insofar as they are compatible with being placed on garden
         leave), the restrictions set out in Clause 14.2 and all duties of good
         faith and fidelity during the Garden Leave Period

         19.      OBLIGATIONS UPON TERMINATION OF EMPLOYMENT; CERTAIN OTHER
         TERMINATIONS

         19.1     Upon the termination of her employment hereunder for whatever
         reason the Executive shall:

                  (a) forthwith tender her resignation as a Director of the
                  Company and of any other Group Company without compensation,
                  but without prejudice to any other rights which she may have
                  under this Agreement. To secure her obligation under this
                  Agreement the Executive irrevocably appoints the Company to be
                  her attorney in her name and on her behalf to sign any
                  documents and do any things necessary to give effect thereto,
                  if the Executive shall fail to sign or do the same herself.

                  (b) deliver up to the Company all vehicles, keys, credit
                  cards, correspondence, documents, specifications, reports,
                  papers and records (including any computer materials such as
                  discs or tapes) and all copies thereof and any other property
                  (whether or not similar to the foregoing or any of them)
                  belonging to the Company or any other Group Company which may
                  be in her possession or under her control, and (unless
                  prevented by the owner thereof) any such property belonging to
                  others which may be in her possession or under her control and
                  which relates in any way to the business or affairs of the
                  Company or any other Group Company or any supplier, agent,
                  distributor or customer of the Company or any other Group
                  Company, and she shall not without written consent of the
                  Board or the Board of Holdings retain any copies thereof;

                  (c) if so requested send to the Company Secretary a signed
                  statement confirming that she has complied with Clause
                  19.1(b); and

                  (d) not at any time make any untrue or misleading oral or
                  written statement concerning the business and affairs of the
                  Company or any other Group Company

                                       12


                  or represent herself or permit herself to be held out as being
                  in any way connected with or interested in the business of the
                  Company or any other Group Company (except as a former
                  employee for the purpose of communicating with prospective
                  employers or complying with any applicable statutory
                  requirements).

         19.2     In the event of a termination of Executive's employment
         hereunder by the Executive with Good Reason or by the Company without
         Cause (other than by reason of death), the Executive shall be entitled
         to (a) salary at her Salary Rate through the date in which her
         termination occurs; (b) the lesser of (x) the target annual incentive
         award for the year in which the Executive's termination occurs, and (y)
         the average of the annual incentive awards received by the Executive in
         the prior three years (or, if less the number of prior years in which
         the Executive was employed by the Company), multiplied by a fraction,
         the numerator of which is the number of days that the Executive was
         employed during the applicable year and the denominator of which is
         365; (c) subject to Clauses 19.3 and 19.4 below, the sum of 2 times (x)
         the Executive's highest Salary Rate during the term of this Agreement
         and (y) the average bonus under the Company's annual incentive plan
         actually earned by the Executive during the three years (or number of
         complete years employed by the Company, if fewer) immediately prior to
         the year of termination (the sum of 2 times (x) and (y) hereafter
         referred to as the "Severance Payment"), and (d) the unpaid balance of
         all previously earned cash bonus and other incentive awards with
         respect to performance periods which have been completed, but which
         have not yet been paid, all of which amounts shall be payable in a lump
         sum in cash within 30 days after her termination. In the event that the
         Company terminates the Executive's employment without Cause under the
         provisions of Section 17.1(ii) the parties acknowledge that the
         Severance Payment will be inclusive of the Executive's rights to be
         paid in lieu of the 12 months' notice period to which she is entitled
         under that Clause.

         19.3     In the event that the Executive's entitlement to a Severance
         Payment arises as a result of the Executive's employment being
         terminated by the Executive with Good Reason or by the Company
         terminating the Executive's employment without Cause under the
         provisions of Clause 17.1(ii), 50% of the Severance Payment shall be
         paid to the Executive within 14 days of the execution by the Executive
         of a valid release in accordance with Clause 21. The remaining 50% of
         the Severance Payment will be paid in four equal installments during
         the 12 months following the first anniversary of the termination of the
         Executive's employment (with the first quarterly payment being paid on
         or as soon as reasonably practicable after the date which is three
         months after the first anniversary of the date of termination and each
         subsequent quarterly payment being paid on the date which is three
         months after the last quarterly payment) in specific consideration for
         the agreement by the Executive to be bound by the further covenants set
         out in Clause 14.3 to apply during that period. In the event that the
         Executive breaches any part of Clause 14.3 at any time during that 12
         months period or the Executive successfully challenges in a court of
         competent jurisdiction the enforceability of all or any part of the
         covenants set out in Clause 14.3, the Company shall not be obliged to
         make any further quarterly payments to the Executive whatsoever (and in
         addition shall not be prevented from taking any other action to enforce
         the covenants set out in Clause 14.3 whatsoever in the event of breach
         by the Executive).


                                       13


         19.4      In the event that the Executive's employment is terminated by
         the Company without Cause under the provisions of Clause 17.1 (i) and
         the Company exercises all or any of its rights under Clause 18.3 during
         the 12 months' notice period, the Severance Payment shall be reduced by
         a sum equal to the total salary and bonus payments received by the
         Executive during the Garden Leave Period and the total Severance
         Payment (reduced in accordance with this Clause) will be paid in four
         equal installments during the 12 months following the termination of
         the Executive's employment (with the first quarterly payment being paid
         on or as soon as reasonably practicable after the date which is three
         months after the termination of the Executive's employment and each
         subsequent quarterly payment being made on the date which is three
         months after the last quarterly payment) provided that if during that
         12 months period the Executive breaches any of the provisions of Clause
         14.2 or the Executive successfully challenges in a court of competent
         jurisdiction the enforceability of all or any part of the covenants set
         out in Clause 14.2, the Company shall not be obliged to make any
         further quarterly payments to the Executive whatsoever (and in addition
         shall not be prevented from taking any other action to enforce the
         covenants set out in Clause 14.2 whatsoever in the event of breach by
         the Executive).

         19.5      Notwithstanding any other provision contained in this
         Agreement, in the event that the Executive breaches any material
         provision of the Shareholder Agreement between Executive and the
         Company, if such breach has a material adverse effect on the Group and,
         if capable of remedy, is not remedied by the Executive within 21 days
         of the Executive's receipt of a notice from the Company requiring
         remedy to be made, the Company shall have the right to terminate the
         employment of the Executive; provided that, notwithstanding any other
         provision of this Agreement, upon such a termination, the Executive
         shall be entitled to receive only salary at the Salary Rate through the
         date of termination. For the purposes of Clause 14 such termination
         shall be deemed to be a termination for Cause.

         19.6     Upon any termination of employment, the Executive shall be
         entitled to (a) any expense reimbursement due to her and (b) other
         benefits (if any) in accordance with the applicable plans and programs
         of the Company.

         19.7     In the event of any termination of employment under this
         Agreement, the Executive shall be under no obligation to seek other
         employment and there shall be no offset against amounts due the
         Executive under this Agreement on account of any remuneration
         attributable to any subsequent employment that she may obtain.

         20.      EFFECT OF TERMINATION OF THIS AGREEMENT

         20.1     The expiry or termination of this Agreement however arising
         shall not operate to affect any of the provisions hereof which are
         expressed to operate or have effect thereafter and shall not prejudice
         the exercise of any right or remedy of either party accrued beforehand.


                                       14


         21.      GENERAL RELEASE

         Notwithstanding any provision herein to the contrary, prior to payment
         of any amount pursuant to Clauses 15.2 and 19.2, the Executive shall
         execute a valid general release, in the form attached hereto (except to
         the extent a change in law or any current practice existing at the date
         of termination requires a modification to such release), pursuant to
         which the Executive shall release the Group and its shareholders,
         directors, officers, employees and agents, to the maximum extent
         permitted by law, from any and all claims the Executive may have
         against the Group that relate to or arise out of the Executive's
         employment or termination of employment, except such claims arising
         under this Agreement.

         22.      OTHER TERMS AND CONDITIONS

         22.1     The Company shall maintain a directors' and officers'
         liability insurance policy covering the Executive which is no less
         favorable than the policy covering other senior executive officers of
         the Company. In addition, the Company expressly acknowledges that the
         Executive is in the class of individuals entitled to be an "Indemnified
         Person" (as such term is defined in the Amended and Restated Bye-Laws
         of Aspen Insurance Holdings Limited (the "Bye-Laws")). As such, the
         Executive shall be entitled to the greatest of any and all protections
         regarding indemnity, insurance and advancement and reimbursement of
         expenses provided under the Bye-Laws as in existence on the date
         hereof, the directors' and officers' policy described above, or such
         greater protection as may be provided under applicable law; provided,
         however, that if the Bye-Laws are amended after the date hereof, and,
         as amended, they provide greater benefits than the existing Bye-Laws,
         the Executive shall be entitled to such greater benefits.

         22.2     Pursuant to the Original Agreement, the following particulars
         are given in compliance with the requirements of section 1 of the
         Employment Rights Act 1996:

                  (a) The Executive's period of continuous employment by WUSL
                  which began on 27 September 1993 shall be recognised by the
                  Company.

                  (b) The Executive's hours of work shall be the normal hours of
                  work of the Company which are from 9.00 am to 5.00 pm together
                  with such additional hours as may be necessary without
                  additional remuneration for the proper discharge of her duties
                  hereunder to the satisfaction of the Board.

                  (c) If the Executive is dissatisfied with any disciplinary
                  decision or if she has any grievance relating to her
                  employment hereunder she should refer such disciplinary
                  decision or grievance to the Board of Holdings and the
                  reference will be dealt with by discussion at and decision of
                  a duly convened meeting of the Board of Holdings.

                  (d) A contracting-out certificate is not currently in force in
                  respect of the Executive's employment hereunder.


                                       15


                  (e) Save as otherwise herein provided there are no terms or
                  conditions of employment relating to hours of work or to
                  normal working hours or to entitlement to holiday (including
                  public holidays) or holiday pay or to incapacity for work due
                  to sickness or injury or to pensions or pension schemes or to
                  requirements to work abroad and no collective agreement has
                  any effect upon the Executive's employment hereunder.

         23.      NOTICES

         Any notice to be given hereunder shall be in writing. Notice to the
         Executive shall be sufficiently served by being delivered personally to
         her or be being sent by first class post addressed to her at her usual
         or last known place of residence. Notice to the Company shall be
         sufficiently served by being delivered to the Company Secretary or by
         being sent by first class post to the registered office of the Company.
         Any notice if so posted shall be deemed served upon the third day
         following that on which it was posted.

         24.       PREVIOUS AND OTHER AGREEMENTS

         This Agreement shall take effect in substitution for all previous
         agreements and arrangements (whether written, oral or implied) between
         the Company and the Executive (including, without limitation, the
         Original Agreement) relating to her employment which shall be deemed to
         have been terminated by mutual consent with effect from the
         commencement of the Agreement.

         25.       ENTIRE AGREEMENT/AMENDMENT

         This Agreement contains the entire understanding of the parties with
         respect to the employment of the Executive by the Company. There are no
         restrictions, agreements, promises, warranties, covenants or
         undertakings between the parties with respect to the subject matter
         herein other than those expressly set forth herein. This Agreement may
         not be altered, modified, or amended except by written instrument
         signed by the parties hereto.

         26.       ASSIGNMENT

         This Agreement, and all of the Executive's rights and duties hereunder,
         shall not be assignable or delegable by the Executive. Any purported
         assignment or delegation by the Executive in violation of the foregoing
         shall be null and void ab initio and of no force and effect. This
         Agreement may be assigned by the Company to a person or entity that is
         the successor in interest to substantially all of the business
         operations of the Company. Upon such assignment, the rights and
         obligations of the Company hereunder shall become the rights and
         obligations of such successor person or entity. Failure by such
         successor of the Company to expressly assume this Agreement shall
         constitute an event of "Good Reason", entitling Executive to the
         Benefits set forth in Clause 15 or 19, as applicable.


                                       16


         27.     SEVERABILITY

         In the event that any one or more of the provisions of this Agreement
         shall be or become invalid, illegal or unenforceable in any respect,
         the validity, legality and enforceability of the remaining provisions
         of this Agreement shall not be affected thereby.

         28.     SUCCESSORS/BINDING AGREEMENT

         This Agreement shall inure to the benefit of and be binding upon
         personal or legal representatives, executors, administrators,
         successors, heirs, distributees, devisees and legatees of the parties
         hereto.

         29.     COOPERATION

         During employment by the Company and thereafter, the Executive shall
         provide her reasonable cooperation in connection with any action or
         proceeding (or any appeal from any action or proceeding) that relates
         to events occurring during the Executive's employment; provided,
         however, that after the Executive's employment by the Company has
         ended, (i) any request for such cooperation shall accommodate the
         demands of the Executive's then existing schedule and (ii) if any such
         request will involve more than a de minimis amount of the Executive's
         time, the Executive shall be entitled to reasonable compensation
         therefor.

         30.     GOVERNING LAW

         English law shall apply to this Agreement.

         31.     COUNTERPARTS

         This Agreement may be signed in counterparts, each of which shall be an
         original, with the same effect as if the signatures thereto and hereto
         were upon the same instrument.


                                       17


         IN WITNESS whereof this Agreement has been duly executed and delivered
as a deed the day and year first before written.



SIGNED as a Deed           )
and DELIVERED by           )
SARAH ANN                  )                /s/ Sarah Davies
DAVIES                     )
in the presence of:        )

Witness Signature:                          /s/ Ian Campbell
                                                Ian Campbell
Witness Name:

Witness Address:

Witness Occupation:                         Chartered Accountant

                                   --------------------------------------------


                                   ASPEN INSURANCE UK SERVICES LIMITED

                                   By: /s/ Christopher O'Kane
                                       ----------------------------------------
                                       Name: Christopher O'Kane
                                       Title: Director


                                   ASPEN INSURANCE HOLDINGS LIMITED

                                   By: /s/ Paul Myners
                                       ----------------------------------------
                                       Name: Paul Myners
                                       Title: Chairman


                                       18


        ANNEX - FORM OF RELEASE TO BE ENTERED INTO PURSUANT TO CLAUSE 21



                       DATED ____________________________





                     ASPEN INSURANCE UK SERVICES LIMITED (1)


                      ASPEN INSURANCE HOLDINGS LIMITED (2)



                                       AND




                              SARAH ANN DAVIES (3)



                ------------------------------------------------


                              COMPROMISE AGREEMENT

                ------------------------------------------------






                         LEBOEUF, LAMB, GREENE & MACRAE
                                 1 MINSTER COURT
                                  MINCING LANE
                                 LONDON EC3R 7YL

                            TEL: +44 (0)20 7459 5000
                            FAX: +44 (0)20 7459 5099


                                       19


                                  www.llgm.com

THER AGREEMENT is made as of the _____ day of _______________ [20[  ]]

BETWEEN:

(1)      ASPEN INSURANCE UK SERVICES LIMITED, (Registered in England No.
         1184193), 100 Leadenhall Street, London EC3A 3DD, England (formerly
         known as Wellington Re Services Limited) (the "COMPANY");

(2)      ASPEN INSURANCE HOLDINGS LIMITED incorporated in the Islands of Bermuda
         whose registered office is at Cedar Avenue, Hamilton, Bermuda
         ("HOLDINGS"); and

(3)      SARAH ANN DAVIES of Hollybush Cottages, Bendish, Whitwell,
         Hertfordshire SG4 8JB (hereinafter referred to as the "EXECUTIVE").


IT IS AGREED as follows:

1.       INTERPRETATION

         1.       In this Agreement:

         2.       "GROUP COMPANY" shall mean any holding company of the Company
                  from time to time and any subsidiary of the Company or of any
                  such holding company from time to time. The terms "holding
                  company" and "subsidiary" shall have the meanings ascribed to
                  them by Section 736 of the Companies Act 1985, as amended; and

         3.       "SERVICE AGREEMENT" shall mean the service agreement entered
                  into between the Executive, Holdings and the Company dated [
                  ], as subsequently amended.

2.       TERMINATION DATE

         The Executive's employment with the Company [will end][ended] on [date]
         (the "TERMINATION DATE").

3.       PAYMENT OF SALARY ETC

         The Company will continue to provide the Executive with her salary and
         all other contractual benefits up to the Termination Date in the normal
         way. Within 14 days of the Termination Date the Company will also pay
         the Executive in respect of her accrued but untaken holiday (less such
         deductions for income tax and national insurance as are required by
         law).


                                       20



4.       TERMINATION SUMS

         Subject to the Executive agreeing to all of the conditions set out
         below, and receipt by the Company of a copy of this Agreement signed by
         the Executive and the attached certificate signed by the Executive's
         legal adviser, the Company will pay the Executive the following sums:

         (i)      (pound)[appropriate figure to be inserted] in respect of the
                  Executive's entitlement to an annual incentive award for the
                  year in which the termination of the Executive's employment
                  with the Company occurs, as calculated in accordance with
                  Clause 19.2 (b) of the Service Agreement;

         (ii)     the sum of (pound)[appropriate figure to be inserted] in
                  respect of the Executive's entitlement to a Severance Payment,
                  as calculated and defined in accordance with Clauses 19.2(c)
                  and 19.4 of the Service Agreement. 50% of the Severance
                  Payment will be paid within 14 days of the Termination Date.
                  The remaining 50% of the Severance Payment will be paid in
                  four equal instalments strictly in accordance with and subject
                  to the terms of Clause [19.3] [19.4] [delete as appropriate]
                  of the Service Agreement;

         (iii)    the sum of (pound)[appropriate figure to be inserted] in
                  respect of the Executive's entitlement to the unpaid balance
                  of all previously earned cash bonus and other incentive awards
                  with respect to performance periods which have been completed
                  as at the Termination Date but not yet paid, as calculated in
                  accordance with Clause 19.2(d) of the Service Agreement; and

         (iv)     [the sum of (pound)[appropriate figure to be inserted] in
                  respect of the Executive's entitlement to payment under Clause
                  15.2(b) of the Service Agreement, such sum to be paid as and
                  when any such excise tax as referred to in that Clause 15.2(b)
                  is payable](1)

         The sums set out in (i) to [(iv)] above will be subject to such
         deductions for income tax and national insurance as are required by
         law). Save as set out in (iii) and (iv) above, the above sums will be
         paid to the Executive within [14] days of the date of signature by her
         of this Agreement and signature by her legal adviser of the attached
         certificate. Payment will be made by transfer to the Executive's bank
         account.

5.       SHARE OPTIONS

         [The Company confirms that the extent to which share options held by
         the Executive as at the Termination Date shall be exercisable following
         the Termination Date will be determined solely in accordance with terms
         of the agreements under which such share options were granted.] or
         [Other than in relation to share options granted to the Executive prior
         to the date of the Service Agreement, the Company confirms that all
         share options


----------------------
(1)  Delete if no qualifying termination in connection with a Change of Control
     under Clause 15.2 of the Service Agreement

                                       21



         granted to the Executive have vested and will remain Exercisable for
         the remainder of their terms.](2)

6.       WAIVER OF CLAIMS

         The Executive accepts the terms set out in this Agreement in full and
         final settlement of all and any claims that she has or may have against
         the Company, Holdings or any other Group Company or any of its or their
         current or former shareholders, directors, officers, employees or
         agents, whether contractual (whether known or unknown, existing now or
         in the future), statutory or otherwise, arising out of or in connection
         with her employment with the Company or the termination of her
         employment and her directorship of the Company and any Group Company
         (or her resignation therefrom) or the termination of her position as
         Executive Vice President, Chief Operating Officer. The Executive also
         agrees to waive irrevocably and release the Company and all Group
         Companies (and all of its or their current or former shareholders,
         directors, officers, employees or agents) from and against any claims
         whether contractual (whether known or unknown, existing now or in the
         future), statutory or otherwise, arising out of or in connection with
         her employment with the Company or the termination of her employment
         and her directorship of the Company and any Group Company (or her
         resignation therefrom) or the termination of her position as Chief
         Operating Officer. This waiver shall not apply in relation to any claim
         relating to her pension rights that have accrued up to the Termination
         Date.


7.       CONFIRMATION OF NO BREACHES

         The Executive confirms and warrants to the Company that she has not at
         any time during her employment committed a fundamental breach of the
         terms of the Service Agreement.

8.       LEGAL ADVICE

         The Executive confirms that she has received advice from [name of legal
         advisor] of [name and address of solicitors], a relevant independent
         adviser for the purposes of section 203 of the Employment Rights Act
         1996, as to the terms and effect of this Agreement and, in particular,
         its effect on her ability to pursue her rights before an employment
         tribunal. The Executive will procure that her legal adviser signs the
         attached legal adviser's certificate, which forms part of this
         Agreement.

9.       SATISFACTION OF STATUTORY CONDITIONS

(a)      This Agreement satisfies the conditions for regulating compromise
         agreements under Section 203 of the Employment Rights Act 1996,
         Regulation 35 of the Working Time Regulations 1998, Section 77 of the
         Sex Discrimination Act 1975, Section 72 of the Race Relations Act
         1976, Section 9 of the Disability Discrimination Act 1995, Regulation
         9 of

---------------------
(2)  Second alternative to be used in the event of qualifying termination in
     connection with a Change of Control under Clause 15.2 of the Service
     Agreement.


                                       22


         the Part-Time Workers (Prevention of Less Favourable Treatment)
         Regulations 2000, Regulation 10 of the Fixed Term Employees
         (Prevention of Less Favourable Treatment) Regulations 2002, Section 49
         of the National Minimum Wage Act 1998, Paragraph 2(2) of Schedule 4 to
         the Employment Equality (Religion or Belief) Regulations 2003 and
         Paragraph 2(2) of Schedule 4 to the Employment Equality (Sexual
         Orientation) Regulations 2003.

(b)      The Executive is aware of her rights under the Employment  Rights Act
         1996, the Working Time Regulations 1998, the Sex Discrimination Act
         1975, the Race Relations Act 1976, the Disability Discrimination Act
         1995, the Part-Time Workers (Prevention of Less Favourable Treatment)
         Regulations 2000, the Fixed Term Employees (Prevention of Less
         Favourable Treatment) Regulations 2002, the National Minimum Wage Act
         1998, the Employment Equality (Religion or Belief) Regulations 2003 and
         the Employment Equality (Sexual Orientation) Regulations 2003 and has
         informed the Company of any and all claims that she might seek to bring
         arising from her employment or termination of employment. This
         agreement relates to her claims for breach of contract, unfair
         dismissal, sex discrimination, race discrimination, disability
         discrimination, sexual orientation discrimination, religion or belief
         discrimination, any claim under the Working Time Regulations 1998, any
         claim under the National Minimum Wage Act 1998, the Part-Time Workers
         (Prevention of Less Favourable Treatment) Regulations 2000, the Fixed
         Term Employees (Prevention of Less Favourable Treatment) Regulations
         2002 or any claim for unlawful deductions from wages under the
         Employment Rights Act 1996.

10.      RESIGNATION OF DIRECTORSHIP

         At the same time as executing this Agreement the Executive will resign
         with immediate effect from her directorship of the Company and from all
         directorships and offices (including but not limited to her position as
         Executive Vice President, Chief Operating Officer of Holdings) held
         with other Group Companies (and all related trusteeships) by signing
         and delivering the attached letters of resignation.

11.      POST-TERMINATION RESTRAINTS

         The Executive acknowledges that the provisions of Clause 11
         (Confidentiality) and Clause 14 (Restrictive Covenants) of the Service
         Agreement will (to the extent that they are applicable in the
         circumstances of the termination of the Executive's employment with the
         Company) remain in full force and effect notwithstanding the
         termination of her employment.

12.      RETURN OF COMPANY PROPERTY

         Before any payment under Clause 4 above is made, the Executive will, in
         accordance with Clause 19.1(b) of the Service Agreement, deliver up to
         the Company all vehicles, keys, credit cards, correspondence,
         documents, specifications, reports, papers and records (including any
         computer materials such as discs or tapes) and all copies thereof and
         any other property (whether or not similar to the foregoing or any of
         them) belonging to the Company or any other Group Company which may be
         in her possession or under her control, and (unless prevented by the
         owner thereof) any such property belonging to others which may be in
         her possession or under her




                                       23


         control and which relates in any way to the business or affairs of the
         Company or any other Group Company or any supplier, agent, distributor
         or customer of the Company or any other Group Company, and she confirms
         that she has not retained any copies thereof.

13.      CONFIDENTIALITY

         Save by reason of any legal obligation or to enforce the terms of this
         letter, the Executive will not:

         (a) disclose the existence or terms of this Agreement to anyone (other
         than to the Executive's professional advisers, the Inland Revenue or
         any other competent authority or the Executive's spouse);

         (b) directly or indirectly disseminate, publish or otherwise disclose
         (or allow to be disseminated, published or otherwise disclosed) by any
         means (whether oral, written or otherwise) or medium (including without
         limitation electronic, paper, radio or television) any information
         directly or indirectly relating to the termination of the Executive's
         employment; or

         (c) make any derogatory or disparaging comments about the Company, any
         Group Company or any of its or their shareholders, directors, officers,
         employees or agents.

14.      NO ADMISSION OF LIABILITY

         This agreement is made without any admission on the part of the Company
         or any Group Company that it has or they have in any way breached any
         law or regulation or that the Executive has any claims against the
         Company or any Group Company.

15.      TAX INDEMNITY

         The Executive hereby agrees to be responsible for the payment of any
         tax and employee's national insurance contributions imposed by any
         competent taxation authority in respect of any of the payments and
         benefits provided under this Agreement (other than for the avoidance of
         doubt, any tax and/or employee's national insurance contributions
         deducted or withheld by the Company in paying the sums to the
         Executive). The Executive further agrees to indemnify the Company and
         all Group Companies and keep them indemnified on an ongoing basis
         against any claim or demand which is made by any competent taxation
         authority against the Company or any Group Company in respect of any
         liability of the Company or any Group Company to deduct an amount of
         tax or an amount in respect of tax or any employee's national insurance
         contributions from the payments made and benefits provided under this
         Agreement, including any related interest or penalties imposed by any
         competent taxation authority.


                                       24


16.      ENTIRE AGREEMENT

         This letter sets out the entire agreement between the Executive, the
         Company and any Group Company and, save as set out in Clauses 5 and 11
         above, supersedes all prior arrangements, proposals, representations,
         statements and/or understandings between the Executive, the Company and
         any Group Company.

17.      THIRD PARTY RIGHTS

         Notwithstanding the Contracts (Rights of Third Parties) Act 1999 this
         Agreement may be varied by agreement between the Executive and the
         Company.

18.      APPLICABLE LAW

         This agreement is subject to English law and the exclusive jurisdiction
         of the English courts.


------------------------------------
Sarah Ann Davies


------------------------------------
dated


-------------------------------------
For and on behalf of Aspen Insurance UK Services Limited


-------------------------------------
dated

-------------------------------------
For and on behalf of Aspen Insurance Holdings Limited


-------------------------------------
dated



                                       25


                           LEGAL ADVISER'S CERTIFICATE



I, [name of solicitor] of [address of firm] hereby confirm to Aspen Insurance UK
Services Limited that I am an independent adviser for the purposes of section
203 of the Employment Rights Act 1996 and that I have advised Sarah Ann Davies
as to the terms and effect of this Agreement and its effect on her ability to
pursue her rights before an employment tribunal. There was in force, when such
advice was given, a policy of insurance covering the risk of a claim by Sarah
Ann Davies in respect of loss arising in consequence of such advice.



----------------------------
[name of adviser]



----------------------------
dated


                                       26



To the board of Directors of:-
Aspen Insurance UK Services Limited
Aspen Insurance Holdings Limited


                                                                          [date]



Dear Sirs


ASPEN INSURANCE UK SERVICES LIMITED (THE "COMPANY") AND ASPEN INSURANCE HOLDINGS
LIMITED ("HOLDINGS")

I hereby irrevocably and unconditionally resign from the office of Director of
the Company and as a Executive Vice President, Chief Operating Officer of
Holdings with immediate effect, and I acknowledge and confirm that I have no
claim of whatsoever kind outstanding for compensation or otherwise against the
Company, Holdings or any of its or their servants, officers, agents or employees
in respect of the termination of my appointments.

Yours faithfully




SIGNED as a DEED           )
and DELIVERED              )
by SARAH ANN DAVIES        )
in the presence of:        )

Witness signature:

Witness Name:

Witness address:

[NOTE: SEPARATE INDIVIDUAL SIMILAR LETTERS OF RESIGNATION TO BE PRODUCED FOR ANY
OTHER GROUP COMPANIES OF WHICH SHE IS A DIRECTOR]


         27