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                                                                    Exhibit 4.11

                          ___% JUNIOR SUBORDINATED NOTE

$___________                                      Dated as of  ___________, 2003

         Kingsway America Inc., a corporation duly organized and existing under
the laws of the state of Delaware (hereinafter called "Kingsway America"), for
value received, hereby promises to pay to Kingsway U.S. Funding Inc., a
corporation duly organized and existing under the laws of the state of Delaware
(hereinafter called the "Company"), the principal sum of $_________ on
______________, 2033 (the "Maturity Date"), and, subject to the terms and
conditions hereof, to pay interest thereon from __________, 2003, or from the
most recent interest payment date (each such date, an "Interest Payment Date")
to which interest has been paid or duly provided for, quarterly in arrears on
March 31, June 30, September 30 and December 31 in each year, commencing
__________, 2003, at the rate of ___% per annum, including any Additional
Amounts, and any Additional Sums that become payable pursuant to the Junior
Subordinated Debenture (defined below), if applicable, until the principal
hereof is paid or made available for payment, and at the rate of ___% per annum
on any overdue principal and premium and on any overdue installment of interest,
Additional Amounts, and Additional Sums, if applicable, upon and subject to the
terms and conditions set forth herein.

         This Subordinated Note is issued in connection with a certain
Indenture, dated as of __________, 2003 (the "Indenture"), between the Company,
as Issuer, Kingsway Financial Services Inc., as Guarantor, and BNY Midwest Trust
Company, as trustee (the "Trustee", which term includes any successor trustee
under the Indenture) pursuant to which the Company has issued a ___% Junior
Subordinated Debenture Due 2033 in the original principal amount of
$_____________ (the "Junior Subordinated Debenture"), and a certain Amended and
Restated Declaration of Trust of Kingsway Financial Capital Trust I dated as of
__________, 2003 (the "Declaration of Trust"), among the Company, as Depositor,
BNY Midwest Trust Company, as Property Trustee, The Bank of New York (Delaware),
as Delaware Trustee, the Administrative Trustees named therein, and the Several
Holders, as defined therein. All terms used in this Subordinated Note that are
defined in the Indenture and not otherwise defined herein shall have the
respective meanings assigned in the Indenture.

         In the event that any Additional Interest, Additional Amounts,
Additional Sums or Defaulted Interest becomes payable pursuant to the Junior
Subordinated Debenture, or that any amounts become payable thereunder pursuant
to a Special Record Date or at any time other than a Regular Record Date, such
amounts shall become payable hereunder at such times as may be due and payable
pursuant to the Junior Subordinated Debenture.

ARTICLE I PAYMENT TERMS

     Section 1.01 Place and Manner of Payment.

         Payment of the principal of (and premium, if any) and any such
interest, including any Additional Interest, any Additional Amounts, and any
Additional Sums, if applicable, on this

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Subordinated Note will be made to the Company at the address specified herein or
such other place as the holder of this Subordinated Note shall designate to
Kingsway America in writing from time to time, in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts.

     Section 1.02  Computation of Interest.

         Interest on this Subordinated Note will be computed on the basis of a
360-day year consisting of twelve 30-day months.

     Section 1.03  Extension Periods.

         So long as no Event of Default (as hereinafter defined) has occurred
and is continuing, Kingsway America shall have the right at any time during the
term of this Subordinated Note, from time to time, to defer payment of interest
on this Subordinated Note for up to 20 consecutive quarterly interest payment
periods with respect to each deferral period (each an "Extension Period"),
during which Extension Periods Kingsway America shall have the right to make
partial payments of interest on any Interest Payment Date, and at the end of
which Kingsway America shall pay all interest (compounded quarterly) then
accrued and unpaid, including Additional Interest, any Additional Amounts, and
any Additional Sums, if applicable; provided, however, that no Extension Period
may extend beyond the Maturity Date. During any such Extension Period, Kingsway
America will not (a) declare or pay any dividends or distributions on or redeem,
purchase, acquire or make a liquidation payment with respect to, any of its
capital stock, which includes common and preferred stock (other than any
dividends or distributions paid to, or redemptions, purchases, acquisitions or
liquidation payments made with respect to, any Subsidiary that is wholly owned,
directly or indirectly, by Kingsway America or the Guarantor), or (b) make, or
permit any Subsidiary to make, any payment of principal, interest or premium, if
any (other than payments under this Subordinated Note), on or repay, repurchase
or redeem any debt security that ranks pari passu with or junior in interest to
this Subordinated Note, the Junior Subordinated Debenture, the Guarantee or the
Guarantee Agreement, or (c) make, or permit any Subsidiary to make, any
guarantee payments with respect to any guarantee of any debt security, if such
guarantee ranks pari passu with or junior in interest to this Subordinated Note,
the Junior Subordinated Debenture, the Guarantee or the Guarantee Agreement.
Notwithstanding the foregoing, the following shall not be prohibited: (i)
repurchases, redemptions or other acquisitions of shares of capital stock of
Kingsway America in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of capital
stock of Kingsway America (or securities convertible into or exercisable for
such capital stock) as consideration in an acquisition transaction entered into
prior to the occurrence of the Event of Default or selection of an Extension
Period by Kingsway America, as applicable, (ii) any transactions described in
(a) or (b) above resulting from any reclassification of Kingsway America's
capital stock, or the exchange or conversion of any class or series of Kingsway
America's capital stock, for any other class or series of Kingsway America's
capital stock or the exchange or conversion of any class or series of Kingsway
America's Indebtedness for any class or series of Kingsway America's capital
stock, (iii) the purchase of fractional interests in shares of Kingsway
America's capital stock pursuant to the conversion or exchange

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provisions of such capital stock or the security being converted or exchanged,
or (iv) any declaration of a dividend in connection with any stockholders'
rights plan, or the issuance of rights, stock or other property under any
stockholders' rights plan, or the redemption or repurchase of rights pursuant
thereto. Prior to the termination of any such Extension Period, but provided
that no Event of Default has occurred and is continuing, Kingsway America may
further extend such Extension Period; provided, however, that such extension
does not cause such Extension Period to exceed 20 consecutive quarterly interest
payment periods or extend beyond the Maturity Date. Upon the termination of any
Extension Period and the payment of all accrued and unpaid interest (compounded
quarterly), including Additional Interest, any Additional Amounts, and any
Additional Sums, if applicable, and then due, Kingsway America may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period except at the end thereof.
Kingsway America shall give the holder of this Subordinated Note notice of its
election to begin any Extension Period at least five Business Days prior to the
Interest Payment Date, or prior to the earlier of (i) the date the Distributions
on the Preferred Securities to which the Junior Subordinated Debenture relates,
would have been payable under the terms of the Indenture or the Junior
Subordinated Debenture except for the election to begin or extend such Extension
Period or (ii) the date the Administrative Trustees of Kingsway Financial
Capital Trust I are required to give notice to any exchange or automated
quotation system or to holders of such Preferred Securities of the record date
or the date such Distributions are payable under the terms of the Indenture or
the Junior Subordinated Debenture, but in any event not less than five Business
Days prior to such record date. There is no limitation on the number of times
Kingsway America may elect to begin an Extension Period.

     Section 1.04  Payment on Non-Business Day.

         In any case where any Interest Payment Date or the Maturity Date of
this Subordinated Note shall not be a Business Day, then (notwithstanding any
other provision of this Subordinated Note) payment of interest or principal (and
premium, if any) need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the
Interest Payment Date or Maturity Date, as the case may be, provided that no
interest will accrue for the period from and after such Interest Payment Date or
Maturity Date, as the case may be, except that if such Business Day falls in the
next calendar year, such payment will be made on the immediately preceding
Business Day (without any reduction of interest or any other payment in respect
of such acceleration), in each case, with the same force and effect as if made
on such date.

     Section 1.05  Prepayment.

         Upon each redemption of all or any portion of the Junior Subordinated
Debenture in accordance with the terms of the Indenture, Kingsway America shall
make on the day of such redemption a mandatory prepayment of all or a portion,
as applicable, of the principal amount of this Subordinated Note in an amount
equal to the principal amount of the Junior Subordinated Debenture so redeemed.
Each such prepayment of a principal amount of this Subordinated Note shall be
accompanied by payment of all accrued but unpaid interest and other charges
thereon, including any Additional Interest, Additional Amounts and Additional
Sums, if applicable, with respect to such principal amount. All prepayments on
account of the indebtedness evidenced by

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this Subordinated Note shall be first applied to accrued and unpaid interest on
the unpaid principal balance of this Subordinated Note and to all other sums, if
any, then due the holder hereof hereunder in such order as the holder hereof may
determine, and the remainder, if any, to said unpaid principal balance, or as
otherwise set forth in the Indenture governing the application of money
collected by the Trustee in connection with the Junior Subordinated Debenture.

ARTICLE II SUBORDINATION PROVISIONS

     Section 2.01  Subordination to Senior Debt.

         Notwithstanding any other provision in this Subordinated Note or any
other document related thereto, the payment of the principal of (and premium, if
any) and interest (including Additional Interest) on, any Additional Amounts,
and if applicable, any Additional Sums under this Subordinated Note (all such
amounts together being herein sometimes referred to as the "Subordinated Note
Obligations") are hereby expressly made subordinate and junior in right of
payment to the prior payment in full of all amounts then due and payable in
respect of all Senior Debt (as defined below) to the extent and in the manner
set forth in this Subordinated Note.

         As used herein, "Senior Debt" means the principal of (and premium, if
any) and interest, if any (including interest accruing on or after the filing of
any petition in bankruptcy or for reorganization relating to Kingsway America
whether or not such claim for post-petition interest is allowed in such
proceeding), on Indebtedness of Kingsway America, whether incurred on or prior
to the date of this Subordinated Note or thereafter incurred, including, without
limiting the generality of the foregoing, the Indebtedness of Kingsway America
under (i) Indebtedness with respect to that certain Guaranty by Kingsway
America, dated as of February 23, 1999, in favor of LaSalle Bank National
Association, as Administrative Agent, in connection with the US $100,000,000
Credit Facility Credit Agreement dated as of February 23, 1999, as amended,
among Kingsway Financial Services Inc. and Kingsway U.S. Finance Partnership, as
Borrowers, the Lenders named therein, LaSalle Bank National Association, as
Administrative Agent and Co-Syndications Agent, Canadian Imperial Bank of
Commerce, as Co-Syndications Agent and Documentation Agent, and Canadian
Imperial Bank of Commerce New York Agency, together with any amendments,
revisions, supplements, increases, restatements, modifications, extensions,
renewals, or replacements thereof; and (ii) Indebtedness with respect to that
certain Guaranty by Kingsway America, dated as of May 27, 2003, in favor of
Canadian Imperial Bank of Commerce, as Administrative Agent, in connection with
the CDN $66,500,000 Amended Credit Agreement dated as of May 27, 2003, as
amended, among Kingsway Financial Services Inc. and Kingsway U.S. Finance
Partnership, as Borrowers, the Lenders named therein, Canadian Imperial Bank of
Commerce, as Administrative Agent, LaSalle Bank National Association as
Syndication Agent and CIBC World Markets, as Sole Lead Arranger and Book Runner,
together with any amendments, modifications, extensions, renewals, or
replacements thereof; provided, however, that notwithstanding the foregoing,
Senior Debt shall include all fees, costs, charges, expenses and other amounts
owing in respect of the Indebtedness described in clauses (i) and (ii) above;
and provided, further, that Senior Debt shall not be deemed to include (1) any
Additional Junior Indebtedness, (2) trade accounts payable by Kingsway America
arising in the ordinary course of business (such trade accounts payable being
pari passu in right of payment to Kingsway America's obligations under this
Subordinated Note), (3) obligations with respect to

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which in the instrument creating or evidencing the same or pursuant to which the
same is outstanding, it is provided that such obligations are pari passu, junior
or otherwise not superior in right of payment to Kingsway America's obligations
under this Subordinated Note or (4) Indebtedness of Kingsway America to an
employee or Affiliate of Kingsway America. Senior Debt shall continue to be
Senior Debt and be entitled to the subordination provisions irrespective of any
amendment, revision, supplement, increase, restatement, modification or waiver
of any term of such Senior Debt.

         As used herein, "Additional Junior Indebtedness" means, without
duplication and other than this Subordinated Note, any Indebtedness, liabilities
or obligations of Kingsway America, or any subsidiary of Kingsway America, under
debt securities (or guarantees in respect of debt securities) issued to any
trust, or a trustee of a trust, partnership or other entity affiliated with
Kingsway America that is, directly or indirectly, a finance subsidiary (as such
term is defined in Rule 3a-5 under the Investment Company Act of 1940) or other
financing vehicle of Kingsway America or any Subsidiary of Kingsway America in
connection with the issuance by that entity of preferred securities or other
securities.

     Section 2.02  Payment Over of Proceeds Upon Dissolution, etc.

         In the event of (a) any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to Kingsway America, its creditors or its property,
(b) any proceeding for the liquidation, dissolution, or other winding up of
Kingsway America, voluntary or involuntary, whether or not involving insolvency
or bankruptcy proceedings, (c) any assignment by Kingsway America for the
benefit of creditors or (d) any other marshaling of the assets of Kingsway
America (each such event, if any, herein sometimes referred to as a
"Proceeding"), then the holders of Senior Debt shall be entitled to receive
payment in full of all amounts payable in respect of such Senior Debt, or
provision shall be made for such payment in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of Senior Debt, before the
holder of this Subordinated Note is entitled to receive or retain any payment or
distribution of any kind or character, whether in cash, property or securities,
on account of any Subordinated Note Obligations or on account of the purchase or
other acquisition of this Subordinated Note by Kingsway America or any
Subsidiary of Kingsway America and to that end the holders of Senior Debt shall
be entitled to receive, for application to the payment thereof, any payment or
distribution of any kind or character, whether in cash, property or securities,
which may be payable or deliverable in respect of this Subordinated Note in any
such Proceeding.

         In the event that, notwithstanding the foregoing provisions of this
Section 2.02, Kingsway America or any Subsidiary of Kingsway America shall make
any payment or distribution in payment of any Subordinated Note Obligations
hereunder to the holder of this Subordinated Note before all Senior Debt is paid
in full or payment thereof is provided for in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of Senior Debt, then and in
such event such payment or distribution shall be held in trust for and shall be
paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making payment
or distribution of assets of Kingsway America for application to the payment of
all Senior Debt remaining unpaid, to the extent necessary to pay all

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Senior Debt in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt.

         For purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in cash, property or securities"
shall not be deemed to include shares of stock of Kingsway America as
reorganized or readjusted, or securities of Kingsway America or any other
corporation provided for by a plan of reorganization or readjustment which
securities are subordinated in right of payment to all then outstanding Senior
Debt to substantially the same extent as this Subordinated Note is so
subordinated as provided herein. The consolidation of Kingsway America with, or
the merger of Kingsway America into, another Person or the liquidation or
dissolution of Kingsway America following the sale of all or substantially all
of its properties and assets as an entirety to another Person or the liquidation
or dissolution of Kingsway America following the sale of all or substantially
all of its properties and assets as an entirety to another Person upon the terms
and conditions set forth in Section 11.02 of the Indenture applicable to the
Guarantor shall not be deemed a Proceeding for the purposes of this Section.

     Section 2.03  Prior Payment to Senior Debt Upon Acceleration of
Subordinated Note.

         In the event that this Subordinated Note is declared due and payable
before the Maturity Date, then and in such event the holders of the Senior Debt
outstanding at the time this Subordinated Note so becomes due and payable shall
first be entitled to receive payment in full of all amounts due on or in respect
of such Senior Debt (including any amounts due upon acceleration), or provision
shall be made for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Debt, before the holder of this
Subordinated Note will be entitled to receive or retain any payment or
distribution of any kind or character, whether in cash, property or securities
by Kingsway America on account of the Subordinated Note Obligations or on
account of the purchase or other acquisition of this Subordinated Note by
Kingsway America or any Subsidiary of Kingsway America; provided, however, that
holders of Senior Debt shall not be entitled to receive payment of any such
amounts to the extent that such holders would be required by the subordination
provisions of such Senior Debt to pay such amounts over to the obligees on trade
accounts payable arising in the ordinary course of business.

         In the event that, notwithstanding the foregoing provisions of this
Section 2.03, Kingsway America or any Subsidiary of Kingsway America shall make
any payment or distribution in payment of any Subordinated Note Obligations to
the holder of this Subordinated Note under the conditions contemplated by the
foregoing provisions of this Section 2.03, then and in such event such payment
or distribution shall be held in trust for and paid over and delivered forthwith
to Kingsway America.

         The provisions of this Section shall not apply to any payment with
respect to which Section 2.02 would be applicable.

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    Section 2.04 No Payment When Senior Debt in Default.

       In the event and during the continuation of any default by Kingsway
America in the payment of any amounts payable in respect of any Senior Debt, or
in the event that any event of default with respect to any Senior Debt shall
have occurred and be continuing and shall have resulted in such Senior Debt
becoming or being declared due and payable prior to the date on which it would
otherwise have become due and payable, unless and until such event of default
shall have been cured or waived or shall have ceased to exist and such
acceleration shall have been rescinded or annulled, or in the event any judicial
proceeding shall be pending with respect to any such default in payment or such
event of default, then no direct or indirect payment or distribution of any kind
or character, by Kingsway America under this Subordinated Note or otherwise,
whether in cash, property or securities shall be made or agreed to be made by
Kingsway America on account of any Subordinated Note Obligations or on account
of any redemption, repayment, retirement, purchase or other acquisition of this
Subordinated Note by Kingsway America or any Subsidiary.

       In the event that, notwithstanding the foregoing provisions of this
Section 2.04, Kingsway America or any Subsidiary of Kingsway America shall make
any payment or distribution in payment of any Subordinated Note Obligations to
the holder of this Subordinated Note under the conditions contemplated by the
foregoing provisions of this Section 2.04, then and in such event such payment
or distribution shall be held in trust for and paid over and delivered forthwith
to Kingsway America.

       The provisions of this Section shall not apply to any payment with
respect to which Section 2.02 would be applicable.

    Section 2.05 Payment Permitted If No Default.

       Nothing contained in this Article or elsewhere in this Subordinated Note
shall prevent Kingsway America, at any time except during the pendency of any
Proceeding referred to in Section 2.02 or under the conditions described in
Section 2.03 or Section 2.04 from making payments at any time of any
Subordinated Note Obligations.

    Section 2.06 Subrogation to Rights of Holders of Senior Debt.

       Subject to the payment in full of all Senior Debt, the holder of this
Subordinated Note shall be subrogated to the rights of the holders of such
Senior Debt to receive payments and distributions of cash, property and
securities applicable to the Senior Debt until the Subordinated Note Obligations
shall be paid in full. For purposes of such subrogation or assignment, no
payments or distributions to the holders of the Senior Debt of any cash,
property or securities to which the holder of the Subordinated Note would be
entitled except for the provisions of this Article II, and no payment over
pursuant to the provisions of this Article II to the holders of Senior Debt by
the holder of this Subordinated Note shall, as among Kingsway America, its
creditors other than holders of Senior Debt, and the holder of this Subordinated
Note, be deemed to be a payment or distribution by Kingsway America to or on
account of the Senior Debt.

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    Section 2.07 Provisions Solely to Define Relative Rights.

       The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the holder of this Subordinated Note
on the one hand and the holders of Senior Debt on the other hand. Nothing
contained in this Subordinated Note is intended to or shall (a) impair, as
between Kingsway America and the holder of this Subordinated Note, the
obligations of Kingsway America, which are absolute and unconditional, to pay to
the holder of this Subordinated Note the Subordinated Note Obligations as and
when the same shall become due and payable in accordance with their terms; or
(b) affect the relative rights against Kingsway America of the holder of this
Subordinated Note and creditors of Kingsway America other than their rights in
relation to the holders of Senior Debt; or (c) prevent the holder of this
Subordinated Note from exercising all remedies otherwise permitted by applicable
law upon default under this Subordinated Note including, without limitation,
filing and voting claims in any Proceeding, subject to the rights, if any, under
this Article of the holders of Senior Debt to receive cash, property and
securities otherwise payable or deliverable to such holder.

    Section 2.08 No Waiver of Subordination Provisions.

       No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of Kingsway America or by any
act or failure to act, in good faith, by any such holder, or by any
noncompliance by Kingsway America with the terms, provisions and covenants of
this Subordinated Note, regardless of any knowledge thereof that any such holder
may have or be otherwise charged with.

    Section 2.09 Reliance on Judicial Order or Certificate of Liquidating
Agent.

       Upon any payment or distribution of assets of Kingsway America referred
to in this Article, the holder of this Subordinated Note shall be entitled to
conclusively rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, liquidating trustee,
custodian, receiver, assignee for the benefit of creditors, agent or other
person making such payment or distribution, delivered to the holder of this
Subordinated Note, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of Senior Debt and
other Indebtedness of Kingsway America, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.

ARTICLE III DEFAULT

    Section 3.01 Event of Default.

       As used herein, "Event of Default" means any one of the following events
(whatever the reason for such Event of Default and whether it may be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree, or order of any court or any order, rule, or regulation of any
administrative or governmental body):

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       (i)   default in the payment of any interest upon this Subordinated Note,
    including Additional Interest in respect thereof, or any Additional Amounts
    payable with respect thereto, when it becomes due and payable, and
    continuance of such default for a period of 30 calendar days (subject to the
    deferral of any due date in the case of an Extension Period);

       (ii)  default in the payment of the principal of (or premium, if any, on)
    this Subordinated Note, or any Additional Amounts payable with respect
    thereto, when it becomes due and payable;

       (iii) default in the performance, or breach, of any covenant or warranty
    of Kingsway America in this Subordinated Note (other than a covenant or
    warranty, a default in the performance or breach of which is elsewhere in
    this Section 3.01 specifically dealt with), and continuance of such default
    or breach for a period of 60 calendar days after there has been given, by
    registered or certified mail, to Kingsway America by the holder of this
    Subordinated Note, a written notice specifying such default or breach and
    requiring it to be remedied and stating that such notice is a "Notice of
    Default" hereunder;

       (iv)  the entry by a court having jurisdiction in the premises of (A) a
    decree or order for relief in respect of Kingsway America in an involuntary
    case or proceeding under any applicable Federal or state bankruptcy,
    insolvency, reorganization, or other similar law or (B) a decree or order
    adjudging Kingsway America a bankrupt or insolvent, or approving as properly
    filed a petition seeking reorganization, arrangement, adjustment, or
    composition of or in respect of Kingsway America under any applicable
    Federal or state law, or appointing a custodian, receiver, liquidator,
    assignee, trustee, sequestrator, or other similar official of Kingsway
    America or of any substantial part of its property, or ordering the winding
    up or liquidation of its affairs, and the continuance of any such decree or
    order for relief or any such other decree or order unstayed and in effect
    for a period of 60 consecutive calendar days;

       (v)   the commencement by Kingsway America of a voluntary case or
    proceeding under any applicable Federal or state bankruptcy, insolvency,
    reorganization, or other similar law or of any other case or proceeding to
    be adjudicated a bankrupt or insolvent, or the consent by it to the entry of
    a decree or order for relief in respect of Kingsway America in an
    involuntary case or proceeding under any applicable Federal or state
    bankruptcy, insolvency, reorganization, or other similar law or to the
    commencement of any bankruptcy or insolvency case or proceeding against it,
    or the filing by it of a petition or answer or consent seeking
    reorganization or relief with respect to Kingsway America under any
    applicable Federal or state bankruptcy, insolvency, reorganization, or other
    similar law, or the consent by it to the filing of such petition or to the
    appointment of or taking possession by a custodian, receiver, liquidator,
    assignee, trustee, sequestrator, or other similar official of Kingsway
    America or of any substantial part of its property pursuant to any such law,
    or the making by it of an assignment for the benefit of creditors, or the
    admission by it in writing of its inability to pay its debts generally as
    they become due, or the taking of corporate action by Kingsway America in
    furtherance of any such action; or

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       (vi)  An occurrence of an Event of Default under the Indenture or the
    Junior Subordinated Debenture.

    Section 3.02 Acceleration.

       (a) If an Event of Default (other than an Event of Default arising under
    Section 3.01(a)(iv) or (v)) occurs and is continuing, then the holder hereof
    may declare the principal amount of this Subordinated Note to be due and
    payable immediately, by a notice in writing to Kingsway America. Upon any
    such declaration, all Subordinated Note Obligations shall become immediately
    due and payable. If an Event of Default arising under Section 3.01(a)(iv) or
    (v) occurs, then all Subordinated Note Obligations shall become immediately
    due and payable without any declaration or other act on the part of the
    holder of this Subordinated Note.

       (b) In the event that payment of the principal amount of the Junior
    Subordinated Debenture is declared to be due and payable immediately,
    pursuant to the applicable terms of the Indenture and the Junior
    Subordinated Debenture, then upon any such declaration, all Subordinated
    Note Obligations shall become immediately due and payable without any
    declaration or other act on the part of the holder of this Subordinated
    Note; provided, however, that in the event such a declaration of
    acceleration under the Junior Subordinated Note shall have been rescinded in
    accordance with the applicable terms of the Indenture and the Junior
    Subordinated Debenture, then the acceleration pursuant to the terms of this
    Section 3.02(b) shall be deemed rescinded.

       (c) In the event that an Event of Default pursuant to the Junior
    Subordinated Debenture shall have been waived in accordance with the
    applicable provisions of the Indenture and the Junior Subordinated
    Debenture, then such Event of Default, to the extent that it constitutes an
    Event of Default under this Subordinated Note, shall also be deemed to be
    waived without any notice or other act on the part of the holder of this
    Subordinated Note. Upon any such waiver, any Event of Default hereunder to
    the extent arising from such Event of Default under the Junior Subordinated
    Debenture will be deemed to have been cured and will cease to exist, but no
    such waiver will extend to any subsequent or other default or impair any
    right consequent thereon.

    Section 3.03 Rights and Remedies Cumulative.

       No right or remedy herein conferred upon or reserved to the holder of
this Subordinated Note is intended to be exclusive of any other right or remedy,
and every right and remedy will, to the extent permitted by law, be cumulative
and in addition to every other right and remedy given hereunder or now or
hereafter existing at law or in equity or otherwise. The assertion or employment
of any right or remedy hereunder, or otherwise, will not prevent the concurrent
assertion or employment of any other appropriate right or remedy.

    Section 3.04 Delay or Omission in Exercise of Rights not a Waiver of Event
of Default.

       No delay or omission of the holder of this Subordinated Note to exercise
any right or remedy accruing upon any Event of Default will impair any such
right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given

                                       10

<PAGE>

by this Subordinated Note or by law to the holder of this Subordinated Note may
be exercised from time to time, and as often as may be deemed expedient, by the
holder of this Subordinated Note.

    Section 3.05 Costs of Collection.

       If this Subordinated Note is past due and is placed in the hands of an
attorney for collection or enforcement or is collected or enforced through any
legal proceedings, then Kingsway America shall pay to the holder hereof all
reasonable attorneys' fees, costs and expenses incurred in connection therewith
in addition to all other amounts due hereunder.

ARTICLE IV OTHER PROVISIONS

    Section 4.01 Governing Law.

       This Subordinated Note shall be governed by, and construed in accordance
with, the laws of the State of New York, without regard to conflicts of laws
principles thereof.

    Section 4.02 Successors and Assigns.

                  This Subordinated Note shall be binding upon Kingsway America
and its successors and assigns, and shall inure to the benefit of the holder
hereof and its successors and assigns.

    Section 4.03 Notices.

       Any notice required or permitted to be given pursuant hereto, or in
connection herewith, shall be (a) in writing and shall be deemed to be given (i)
when delivered in person, (ii) on the second business day after deposit in a
regularly maintained receptacle of the United States mail, as registered or
certified mail, postage prepaid, return receipt requested, (iii) when received
if sent by overnight courier, personal delivery or telecopier transmission, and
(b) to Kingsway America addressed to 1515 Woodfield Road, Suite 820, Schaumburg,
Illinois 60173, Attention: President; and to the holder hereof addressed to it
c/o Kingsway America Inc., 1515 Woodfield Road, Suite 820, Schaumburg, Illinois
60173, Attention: President, or such other address as either such party may
designate in writing to the other from time to time.

    Section 4.04 Invalidity of Particular Provisions.

       In case any one or more of the provisions contained in this Subordinated
Note is for any reason held to be invalid, illegal, or unenforceable in any
respect, such invalidity, illegality, or unenforceability will not affect any
other provision of this Subordinated Note, but this Subordinated Note will be
construed as if such invalid or illegal or unenforceable provision had never
been contained herein or therein.

    Section 4.05 Effect of Headings.

       The Article and Section headings herein are for convenience only and will
not affect the construction of this Subordinated Note.

                                       11

<PAGE>

    Section 4.06 Usury.

       Notwithstanding any provisions of this Subordinated Note to the contrary,
it is the intent of Kingsway America and the holder hereof that the holder
hereof shall never be entitled to receive, collect or apply as interest on
principal of the indebtedness, any amount in excess of the maximum rate of
interest permitted to be charged by applicable law; and if under any
circumstance whatsoever, fulfillment of any provision of this Subordinated Note,
at the time performance of such provision shall be due, shall involve
transcending the limit of validity prescribed by applicable law, then, ipso
facto, the obligation to be fulfilled shall be reduced to the limit of such
validity; and in the event the holder hereof ever receives, collects or applies
as interest any such excess, such amount which would be excess interest shall be
deemed a permitted partial prepayment of principal and treated hereunder as
such; and if the principal of the indebtedness secured hereby is paid in full,
any remaining excess funds shall forthwith be paid to Kingsway America. In
determining whether or not interest of any kind payable hereunder, under any
specific contingency, exceeds the highest lawful rate, Kingsway America and the
holder hereof shall, to the maximum extent permitted under applicable law, (1)
characterize any non-principal payment as an expense, fee or premium rather than
as interest and (2) amortize, prorate, allocate and spread, to the end that the
interest on account of such indebtedness does not exceed the maximum amount
permitted by applicable law; provided that if the amount of interest received
for the actual period of existence thereof exceeds the maximum lawful rate, the
holder shall refund to Kingsway America the amount of such excess. Kingsway
America shall not be subject to any penalties provided by any laws for
contracting for, charging or receiving interest in excess of the maximum lawful
rate.

    Section 4.07 Pari Passu Ranking.

       The obligations of Kingsway America under this Subordinated Note shall
rank pari passu in right of payment to the obligations of Kingsway America
relating to securities issued by Kingsway Connecticut Statutory Trust I,
Kingsway Connecticut Statutory Trust II and Kingsway Delaware Statutory Trust
III.

       IN WITNESS WHEREOF, this instrument has been duly executed and delivered
as of the date first written above.

                                                   KINGSWAY AMERICA INC.

                                                   By:__________________________
                                                      Name:
Attest:                                               Title:

By:____________________________

                                       12<PAGE>

                                                                   Exhibit 10.12

     THIS SECOND AMENDMENT TO THE AMENDED CREDIT AGREEMENT made as of the 31st
day of August, 2003.

A M O N G:

                        KINGSWAY FINANCIAL SERVICES INC.
                      AND KINGSWAY U.S. FINANCE PARTNERSHIP
                                  As Borrowers

                                       AND

                       The Lenders named herein as Lenders

                                       AND

                       CANADIAN IMPERIAL BANK OF COMMERCE,
                             As Administrative Agent

                                       AND

                       LASALLE BANK NATIONAL ASSOCIATION,
                              As Syndication Agent

              WHEREAS:

              1. Pursuant to an Amended Credit Agreement made as of the 27th day
of May, 2003 among the parties hereto as amended by a First Amendment to the
Amended Credit Agreement dated as of the 26th day of June, 2003 (collectively,
the "Credit Agreement"), the Lenders and the Agents established certain credit
facilities in favour of the Borrowers;

              2. The Agents, the Lenders and the Borrowers have agreed to amend
certain terms and conditions of the Credit Agreement in the manner hereinafter
set forth;

              FOR VALUABLE CONSIDERATION, the parties agree as follows:

                                   ARTICLE I

                           AMENDMENT TO INTERPRETATION

1.01     Amendment to the Definition of Funded Debt. Section 1.01(55) of the
Credit Agreement is hereby deleted in its entirety and replaced with the
following:

         "(55)   "Funded Debt" means the aggregate Indebtedness for borrowed
                 money of the Canadian Borrower on a Consolidated basis
                 including, without limitation: (i) Capitalized

<PAGE>

                                       -2-

              Lease Obligations, (ii) Purchase Money Obligations, (iii)
              contingent liabilities under outstanding letters of credit
              (excluding undrawn letters of credit the beneficiary of which is a
              Borrower, Kingsway America, any Subsidiary of a Borrower, State
              National Specialty Insurance Company Inc., State and County Mutual
              Insurance Company, General Reinsurance Corporation, Mutual Service
              Insurance or Fairfield Insurance Company), and (iv) all principal,
              interest and fees incurred in respect of such Indebtedness; and,
              for greater certainty, for the purposes of calculating the ratio
              of Total Funded Debt to Total Capitalization pursuant to
              sub-section 8.02(1), "Funded Debt" shall exclude the gross
              proceeds of the offerings of the Debentures, Trust Pool
              Debentures, Second Round Trust Pool Debentures, Third Round Trust
              Pool Debentures and Fourth Round Trust Pool Debentures (each as
              defined in Section 1.01(93) below."

1.02   Additional Permitted Indebtedness. Section 1.01(93) of the Credit
Agreement is hereby amended by deleting the word "and" at the end of sub-section
1.01(93)(s), by deleting the period found at the end of sub-section 1.01(93)(t)
and replacing such period with a semi-colon, by adding the word "and"
immediately following such semi-colon and by adding the following sub-section
1.01(93)(u):

       "(u)   Indebtedness of the Canadian Borrower, Kingsway America and
              certain of their Subsidiaries in connection with the issuance,
              pursuant to one or more transactions, of preferred securities to
              one or more pooling vehicles by any one of up to four statutory
              trusts (collectively, the "Fourth Round Statutory Trusts") each of
              which are directly or indirectly owned by the Canadian Borrower
              (such Indebtedness herein collectively referred to as the "Fourth
              Round Trust Pool Securities"), provided that:

              (i)    there shall be no cash redemption of any of the Fourth
                     Round Trust Pool Securities without the prior written
                     consent of the Majority of the Lenders;

              (ii)   a Default or Event of Default under the Credit Agreement is
                     not a default or event of default in respect of such
                     Indebtedness and acceleration of the Outstanding
                     Obligations does not result in an acceleration of the
                     obligations under any of the debentures issued in
                     connection with any of the Fourth Round Trust Pool
                     Securities (collectively, the "Fourth Round Trust Pool
                     Debentures") or any Guarantees issued in connection with
                     any of the Fourth Round Trust Pool Debentures;

              (iii)  no cash dividends or other cash payments may be paid on or
                     in respect of any of the Fourth Round Trust Pool Securities
                     so long as a Default or Event of Default under the Credit
                     Agreement has occurred and is continuing;

<PAGE>

                                       -3-

              (iv)   the terms and conditions pertaining to each of the Fourth
                     Round Trust Pool Securities are otherwise satisfactory to
                     the Majority of the Lenders;

              (v)    the Administrative Agent shall have received: (A) all
                     material documentation as determined by the Administrative
                     Agent in its sole discretion relating to all of the Fourth
                     Round Trust Pool Securities and the Fourth Round Trust Pool
                     Debentures, including, without limitation, all materials
                     filed with any securities commission, and the
                     Administrative Agent and the Lenders shall be satisfied
                     with the terms and conditions thereof, and (B) executed
                     intercreditor agreements with the holders of the Fourth
                     Round Trust Pool Securities and the Fourth Round Trust Pool
                     Debentures satisfactory to the Administrative Agent or such
                     other evidence of subordination as may be satisfactory to
                     the Administrative Agent and the Lenders in respect of the
                     obligations of the Borrowers, Kingsway America and their
                     Subsidiaries to the holders of the Fourth Round Trust Pool
                     Securities and the Fourth Round Trust Pool Debentures, to
                     provide, among other things, for subordination of all of
                     the Fourth Round Trust Pool Securities and the Fourth Round
                     Trust Pool Debentures to the payment in full of the
                     Outstanding Obligations;

              (vi)   None of the Fourth Round Statutory Trusts shall incur any
                     debts, liabilities or obligations other than the reasonable
                     fees and expenses of the trustees under the Fourth Round
                     Trust Pool Debentures (acting solely in their capacity as
                     trustee and not in their individual capacity) and the
                     principal, premium (if any) and interest in respect of the
                     Fourth Round Trust Pool Securities; and

              (vii)  the aggregate Indebtedness in respect of all of the Fourth
                     Round Trust Pool Securities does not exceed U.S.
                     $65,000,000 in aggregate, without the prior written consent
                     of the Majority of the Lenders."

<PAGE>

                                       -4-

1.03   Amendment to the Definition of Total Capitalization. Section 1.01(117) of
the Credit Agreement is hereby deleted in its entirety and replaced with the
following:

       "(117)  "Total Capitalization" means, without duplication, the sum of:
               (i) Funded Debt; plus (ii) shareholders equity including, for
               greater certainty, the gross proceeds of the offerings of the
               Trust Preferred Securities, Trust Pool Securities, Second Round
               Trust Pool Securities, Third Round Trust Pool Securities and
               Fourth Round Trust Pool Securities (each as defined in Section
               1.01(93)); all of which shall be calculated in respect of the
               Canadian Borrower on a Consolidated basis in accordance with
               GAAP."

1.04   Amendment to the Definition of Trusts. Section 1.01(120) of the Credit
Agreement is hereby deleted in its entirety and replaced with the following:

       "(120)  "Trusts" means, collectively, Kingsway Financial Capital Trust I,
               Kingsway Connecticut Statutory Trust I, Kingsway Connecticut
               Statutory Trust II, Kingsway Delaware Statutory Trust III, each
               of the Fourth Round Statutory Trusts, and any successors
               thereof."

                                   ARTICLE II

            AMENDMENT TO COVENANTS AND OTHER PROVISIONS AND SCHEDULES

2.01   Amendment to the Business of Subsidiaries Covenant. Section 8.01(27) of
the Credit Agreement is hereby amended by deleting the word "and" at the end of
sub-section 8.01(27)(iv), by deleting the period found at the end of sub-section
8.01(27)(v) and replacing such period with a comma, by adding the word "and"
immediately following such comma and by adding the following sub-section
8.01(27)(vi):

       "(vi)   None of the Fourth Round Statutory Trusts have any assets or
               liabilities (other than ownership of the Fourth Round Trust Pool
               Debentures and liabilities pursuant to the Fourth Round Trust
               Pool Securities) and none of the Fourth Round Statutory Trusts
               have performed any business other than preparing for and
               administering the transactions in relation to the Fourth Round
               Trust Pool Securities issued by it."

2.02   Amendment to Funded Debt to Total Capitalization Ratio. Section 8.02(1)
of the Credit Agreement is hereby deleted in its entirety and replaced with the
following:

       "Funded Debt to Total Capitalization Ratio. The Canadian Borrower shall
       maintain at all times a ratio of Funded Debt to Total Capitalization on a
       Consolidated basis of not greater than 0.30:1.00 calculated quarterly on
       the last day of each fiscal quarter of the Canadian Borrower; provided
       that, for the purposes of this covenant only, neither the Debentures nor
       the Trust Pool

<PAGE>

                                       -5-

       Debentures nor the Second Round Trust Pool Debentures nor the Third Round
       Trust Pool Debentures nor the Fourth Round Trust Pool Debentures shall be
       included in the calculation of Funded Debt but the Debentures, Trust Pool
       Debentures, Second Round Trust Pool Debentures, Third Round Trust Pool
       Debentures and Fourth Round Trust Pool Debentures shall be included in
       the calculation of Total Capitalization."

2.03   Amendment to Minimum Tangible Net Worth Covenant. Section 8.02(2) of the
Credit Agreement is hereby amended by deleting reference therein to
"$300,000,000" and replacing such reference with "$337,000,000" and by deleting
the last sentence of Section 8.02(2) of the Credit Agreement in its entirety and
replacing such sentence with the following:

       "For the purposes of this Section 8.02(2), the calculation of Tangible
       Net Worth shall exclude the gross proceeds of the offerings of the Trust
       Preferred Securities, Trust Pool Securities, Second Round Trust Pool
       Securities, Third Round Trust Pool Securities, Fourth Round Trust Pool
       Securities and any other preferred securities issued by the Canadian
       Borrower or any of its Subsidiaries (including, without limitation, any
       of the Trusts)."

2.04   Amendments to No Guarantees Covenant. Section 8.03(5) of the Credit
Agreement is hereby amended by:

       (a)   deleting sub-section 8.03(5)(j) of the Credit Agreement in its
             entirety and replacing such sub-section with the following:

             "(j) the Guarantees issued by the Canadian Borrower and Kingsway
                  America (in form and substance satisfactory to the Lenders) in
                  connection with the Trust Preferred Securities, Debentures,
                  Trust Pool Securities, Trust Pool Debentures, Second Round
                  Trust Pool Securities, Second Round Trust Pool Debentures,
                  Third Round Trust Pool Securities, Third Round Trust Pool
                  Debentures, Fourth Round Trust Pool Securities and Fourth
                  Round Trust Pool Debentures;"; and

       (b)   deleting the period found at the end of sub-section 8.03(5)(k) and
             replacing such period with a semi-colon, by adding the word "and"
             immediately following such semi-colon and by adding the following
             sub-section 8.03(5)(l):

             "(l) the Guarantee issued by the Canadian Borrower (in form and
                  substance satisfactory to the Lenders) in support of a
                  reinsurance agreement between Lincoln General Insurance
                  Company and Clarendon Insurance Company."

2.05   Amendment to Material Contracts Covenant. Sub-section 8.03(7)(d) of the
Credit Agreement is hereby deleted in its entirety and replaced with the
following:

       "(d)  any documents relating to the Trusts including, without limitation,
             the Debenture Indebtedness, the Debenture Offering, the Trust
             Preferred Securities, the Debentures,

<PAGE>

                                       -6-

             the Trust Pool Securities, the Trust Pool Debentures, the Second
             Round Trust Pool Securities, the Second Round Trust Pool
             Debentures, the Third Round Trust Pool Securities, the Third Round
             Trust Pool Debentures, the Fourth Round Trust Pool Securities, the
             Fourth Round Trust Pool Debentures and any declarations of trust,
             indemnities, indentures, guarantees and other documents, agreements
             and instruments in connection therewith."

2.06   Amendment to Restricted Payments Covenant. Sub-section 8.03(14)(b)(ii) of
the Credit Agreement is hereby deleted in its entirety and replaced with the
following:

       "(ii) make any payment (including, without limitation, any payment of
             principal, premium (if any) or interest) in respect of the
             Debentures, the Trust Preferred Securities, the Trust Pool
             Debentures, the Trust Pool Securities, the Second Round Trust Pool
             Debentures, the Second Round Trust Pool Securities, the Third Round
             Trust Pool Debentures, the Third Round Trust Pool Securities, the
             Fourth Round Trust Pool Debentures, the Fourth Round Trust Pool
             Securities or any other securities issued by any Borrower, Kingsway
             America or any of their Subsidiaries or any guarantees or
             indemnities in respect thereof following the occurrence of a
             Default or an Event of Default or make any such payment if the
             making of such payment would result in the occurrence of a Default
             or Event of Default."

2.07   Amendment to Redemption of Preferred Securities Covenant. Section
8.03(18) of the Credit Agreement is hereby deleted in its entirety and replaced
with the following:

       "(18) Redemption of Preferred Securities. Without the prior written
             consent of the Majority of the Lenders, neither Borrower, nor
             Kingsway America nor any of their Subsidiaries shall redeem any of
             the Trust Preferred Securities, Trust Pool Securities, Second Round
             Trust Pool Securities, Third Round Trust Pool Securities, Fourth
             Round Trust Pool Securities or any other securities issued by any
             Borrower, Kingsway America or any of their Subsidiaries."

2.08   Amendment to Section 9.01(9). Section 9.01(9) of the Credit Agreement is
hereby amended by deleting reference therein to "0 through (f)" and replacing
such reference with "(a) through (f)".

2.09   Amendment to Sections 10.18 and 10.19. Section 10.18 of the Credit
Agreement is hereby amended by deleting reference therein to "notice of
participation and undertaking described in" and replacing such reference with
"assignment and acceptance agreement pursuant to" and Section 10.19 of the
Credit Agreement is hereby amended by deleting reference therein to "assignment
and acceptance" and replacing such reference with "executed assignment and
acceptance agreement".

<PAGE>

                                       -7-

2.10   Amendment to Survival Section. Section 10.22 of the Credit Agreement is
hereby amended by deleting reference therein to "Section 5.05" and replacing
such reference with "Section 5.07".

2.11   Amendment to Schedule "D". Paragraph 2(x)(ii) contained in Schedule "D"
of the Credit Agreement is hereby amended by adding the words "and Fourth Round
Trust Pool Debentures" immediately following the words "Third Round Trust Pool
Debentures" therein.

2.12   Amendment to Schedule "L". Schedule "L" of the Credit Agreement (and
Schedule I thereto) is hereby amended by deleting all references therein to
"Transfer Closing Date" and replacing all such references with "Transfer
Effective Date" and by deleting reference to "Section 9.04" in Schedule I
thereto and replacing such reference with "Section 10.18".

                                  ARTICLE III

                     CONDITIONS PRECEDENT TO THIS AGREEMENT

3.01   Conditions Precedent.

This Second Amendment to the Amended Credit Agreement shall not come into effect
and the Credit Agreement shall not be amended to reflect the amendments
contemplated herein until the Administrative Agent shall have received to its
satisfaction:

       (i)    this Agreement executed by all of the parties hereto;

       (ii)   only with respect to the effectiveness of Section 2.04(b) above
              and the amendment contemplated therein, copies, certified by the
              Chief Financial Officer of the Canadian Borrower, of the executed
              guarantee agreement between Lincoln General Insurance Company and
              the Canadian Borrower together with the executed applicable
              reinsurance agreement between Lincoln General Insurance Company
              and Clarendon Insurance Company; and

       (iii)  such other documentation as the Administrative Agent and the
              Lenders shall reasonably require to effect the amendments
              contemplated in this Second Amendment to the Amended Credit
              Agreement.

                                   ARTICLE IV

                                  MISCELLANEOUS

<PAGE>

                                       -8-

4.01  Nature of Amendments and Defined Terms. It is acknowledged and agreed that
the terms of this Second Amendment to the Amended Credit Agreement are in
addition to and, unless specifically provided for, shall not limit, restrict,
modify, amend or release any of the understandings, agreements or covenants as
set out in the Credit Agreement. The Credit Agreement shall henceforth be read
and construed in conjunction with this Second Amendment to the Amended Credit
Agreement and the Credit Agreement together with all of the powers, provisions,
conditions, covenants and agreements contained or implied in the Credit
Agreement shall be and shall continue to be in full force and effect. References
to the "Credit Agreement" or the "Agreement" in the Credit Agreement or in any
other document delivered in connection with, or pursuant to, the Credit
Agreement, shall mean the Credit Agreement, as amended hereby. Capitalized terms
utilized in this agreement but not defined in this Agreement shall have the
meanings ascribed to such terms in the Credit Agreement.

4.02  Assignment. This Second Amendment to the Amended Credit Agreement shall
enure to the benefit of and be binding upon the parties hereto and their
respective successors and assigns but shall not be assignable by the Borrowers
or either of them without the prior written consent of the Agents and Lenders.

4.03  Severability. Any provision of this Second Amendment to the Amended Credit
Agreement which is prohibited or unenforceable in any jurisdiction shall not
invalidate the remaining provisions hereof and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

4.04  Governing Law. This Second Amendment to the Amended Credit Agreement shall
be governed by and construed in accordance with the laws of the Province of
Ontario and the laws of Canada applicable therein and shall be treated in all
respects as an Ontario contract and the parties hereby submit and attorn to the
non-exclusive jurisdiction of the courts of the Province of Ontario.

4.05  Further Assurances. The Borrowers shall from time to time and at all times
hereafter, upon every reasonable request from the Agents or the Lenders, make,
do, execute and deliver or cause to be made, done, executed and delivered, all
such further acts, deeds and assurances and things as may be necessary in the
opinion of the Agents for more effectually implementing and carrying out the
true intent and meaning of this Second Amendment to the Amended Credit
Agreement.

4.06  Counterparts. This Second Amendment to the Amended Credit Agreement may be
executed in any number of counterparts, each of which shall constitute an
original and all of which, taken together, shall constitute one and the same
agreement.

<PAGE>

                                       -9-

          IN WITNESS WHEREOF the parties hereto have executed this Second
Amendment to the Amended Credit Agreement.

                                       KINGSWAY FINANCIAL SERVICES INC.

                                       By: /s/ William G. Star
                                           ---------------------------------
                                           William G. Star
                                           President and Chief Financial Officer

                                       By: /s/ W. Shaun Jackson
                                           ---------------------------------
                                           W. Shaun Jackson
                                           Executive Vice President & Chief
                                           Financial Officer

                                       KINGSWAY U.S. FINANCE PARTNERSHIP
                                       by its Partners
                                           KINGSWAY FINANCIAL SERVICES INC.

                                       By: /s/ William G. Star
                                           ---------------------------------
                                           William G. Star
                                           President and Chief Financial Officer

                                       By: /s/ W. Shaun Jackson
                                           ---------------------------------
                                           W. Shaun Jackson
                                           Executive Vice President & Chief
                                           Financial Officer

                                       METRO CLAIM SERVICES INC.

                                       By: /s/ William G. Star
                                           ---------------------------------
                                           William G. Star
                                           President

                                       By: /s/ W. Shaun Jackson
                                           ---------------------------------
                                           W. Shaun Jackson
                                           Secretary

                                       CANADIAN IMPERIAL BANK OF COMMERCE,
                                       AS CANADIAN LENDER

                                       By: /s/ Ralph Sehgal
                                           ---------------------------------
                                           Ralph Sehgal
                                           Executive Director

                                       By: /s/ Patti Perras Shugart
                                           ---------------------------------
                                           Patti Perras Shugart
                                           Executive Director

<PAGE>

                                      -10-

                                    HSBC BANK CANADA,
                                    AS CANADIAN LENDER

                                    By:  /s/ Martin J. Haythorne
                                         --------------------------------
                                         Martin J. Haythorne
                                         Assistant Vice President
                                         Corporate, Investment Banking & Markets

                                    By:  ________________________________
                                         Name:
                                         Title:

                                    LASALLE BANK NATIONAL ASSOCIATION,
                                    AS U.S. LENDER

                                    By:  /s/ Bradley J. Kronland
                                         --------------------------------
                                         Bradley J. Kronland
                                         Assistant Vice President

                                    By:  /s/ Robert Frentzel
                                         --------------------------------
                                         Robert Frentzel
                                         Senior Vice President

                                    CANADIAN IMPERIAL BANK OF COMMERCE,
                                    NEW YORK AGENCY, AS U.S. LENDER

                                    By:  /s/ Geraldine Kerr
                                         --------------------------------
                                         Geraldine Kerr
                                         Executive Director

                                    By:  ________________________________
                                         Name:
                                         Title:

                                    CANADIAN IMPERIAL BANK OF COMMERCE,
                                    AS ADMINISTRATIVE AGENT

                                    By:  /s/ Ralph Sehgal
                                         --------------------------------
                                         Ralph Sehgal
                                         Executive Director

                                    By:  /s/ Warren Lobo
                                         --------------------------------
                                         Warren Lobo
                                         Director

<PAGE>

                                      -11-

                                              LASALLE BANK NATIONAL ASSOCIATION,
                                              AS SYNDICATION AGENT

                                              By: /s/ Bradley J. Kronland
                                                  ------------------------------
                                                  Bradley J. Kronland
                                                  Assistant Vice President

                                              By: /s/ Robert Frentzel
                                                  ------------------------------
                                                  Robert Frentzel
                                                  Senior Vice President

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