Document:

Exhibit 4.12

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                      COMMON SECURITIES GUARANTEE AGREEMENT

                          DELPHI FINANCIAL GROUP, INC.

                                  Dated as of ,

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                                TABLE OF CONTENTS

                                                                            Page
                              ARTICLE I

                   DEFINITIONS AND INTERPRETATION

SECTION 1.1     Definitions Interpretation....................................2

                             ARTICLE II

                              GUARANTEE

SECTION 2.1     Guarantee.....................................................3
SECTION 2.2     Waiver of Notice and Demand...................................4
SECTION 2.3     Obligations Not Affected......................................4
SECTION 2.4     Rights of Holders.............................................5
SECTION 2.5     Guarantee of Payment..........................................5
SECTION 2.6     Subrogation...................................................5
SECTION 2.7     Independent Obligations.......................................5

                             ARTICLE III

              LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 3.1     Limitation of Transactions....................................6
SECTION 3.2     Ranking.......................................................6

                             ARTICLE IV

                             TERMINATION

SECTION 4.1     Termination...................................................7

                              ARTICLE V

                            MISCELLANEOUS

SECTION 5.1     Successors and Assigns........................................7
SECTION 5.2     Amendments....................................................7
SECTION 5.3     Notices.......................................................8
SECTION 5.4     Benefit.......................................................8
SECTION 5.5     Governing Law.................................................9
SECTION 5.6     No Recourse Against Certain Persons...........................9

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                      COMMON SECURITIES GUARANTEE AGREEMENT

     GUARANTEE AGREEMENT (this "Common Securities Guarantee"), dated as of , ,
is executed and delivered by Delphi Financial Group, Inc., a Delaware
corporation (the "Guarantor"), for the benefit of the Holders (as defined
herein) from time to time of the Common Securities (as defined herein) of Delphi
Finance Trust I, a Delaware business trust (the "Issuer").

     WHEREAS, pursuant to an amended and restated Declaration of Trust (the
"Declaration"), dated as of , , among the Trustees of the Issuer named therein,
the Guarantor, as sponsor, and the holders from time to time of undivided
beneficial interests in the assets of the Issuer, the Issuer is issuing on the
date hereof common securities having an aggregate liquidation amount of $[ ]
designated the [ ]% Common Securities (the "Common Securities");

     WHEREAS, as incentive for the Holders to purchase the Common Securities,
the Guarantor desires to irrevocably and unconditionally agree, to the extent
set forth in this Common Securities Guarantee, to pay to the Holders of the
Common Securities the Guarantee Payments (as defined herein) and to make certain
other payments on the terms and conditions set forth herein; and

     WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Preferred Securities Guarantee") for the benefit of the holders
of the Preferred Securities (as defined herein), which terms include, among
other things, that if an Event of Default (as such term is defined in the
Indenture) has occurred and is continuing, the rights of Holders of the Common
Securities to receive Guarantee Payments under this Common Securities Guarantee
are subordinated to the rights of holders of Preferred Securities to receive
guarantee payments under the Preferred Securities Guarantee.

     NOW, THEREFORE, in consideration of the purchase by each Holder of Common
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Common Securities Guarantee
for the benefit of the Holders.

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                                    ARTICLE I

                         DEFINITIONS AND INTERPRETATION

SECTION 1.1                Definitions Interpretation.

     In this Common Securities Guarantee, unless the context otherwise requires:

          (a) capitalized terms used in this Common Securities Guarantee but not
     defined in the preamble above have the respective meanings assigned to them
     in this Section 1.1;

          (b) terms defined in the Declaration as at the date of execution of
     this Common Securities Guarantee have the same meaning when used in this
     Common Securities Guarantee unless otherwise defined in this Common
     Securities Guarantee;

          (c) a term defined anywhere in this Common Securities Guarantee has
     the same meaning throughout;

          (d) all references to "the Common Securities Guarantee" or "this
     Common Securities Guarantee" are to this Common Securities Guarantee as
     modified, supplemented or amended from time to time;

          (e) all references in this Common Securities Guarantee to Articles and
     Sections are to Articles and Sections of this Common Securities Guarantee
     unless otherwise specified; and

          (f) a reference to the singular includes the plural and vice versa.

     "Guarantee Payments" shall mean the following payments or distributions,
without duplication, with respect to the Common Securities, to the extent not
paid or made by the Issuer: (i) any accrued and unpaid Distributions that are
required to be paid on such Common Securities, to the extent the Issuer has
funds available therefor, (ii) the redemption price, including all accrued and
unpaid Distributions to the date of redemption (the "Redemption Price"), to the
extent the Issuer has funds available therefor, with respect to any Common
Securities called for redemption by the Issuer, and (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of the Issuer (other than in
connection with the distribution of Subordinated Notes to the Holders in
exchange for Common Securities as provided in the Declaration), the lesser of
(a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Common Securities to the date of payment, to the extent the
Issuer has funds available therefor, and (b) the amount of assets

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                                      -3-

of the Issuer remaining available for distribution to Holders in liquidation of
the Issuer (in either case, the "Liquidation Distribution"). If an Event of
Default (as defined in the Indenture) has occurred and is continuing, the rights
of Holders of the Common Securities to receive Guarantee Payments under this
Common Securities Guarantee are subordinated to the rights of holders of
Preferred Securities to receive guarantee payments under the Preferred
Securities Guarantee.

     "Holder" shall mean any holder, as registered on the books and records of
the Issuer, of any Common Securities.

     "Indenture" means the Indenture dated as of , 2002, between the Guarantor
and [ ], as Trustee, and the First Supplemental Indenture thereto pursuant to
which certain subordinated debt securities of the Guarantor are to be issued to
the Property Trustee (as defined in the Declaration), as from time to time
amended.

     "Property Trustee" shall have the meaning ascribed to such term in the
Declaration.

     "Subordinated Notes" means the series of subordinated debt securities of
the Guarantor designated the [ ]% Subordinated Deferrable Interest Notes due ,
20 held by the Property Trustee.

     "Preferred Securities" shall mean the securities representing preferred
undivided beneficial interests in the assets of the Issuer.

     "Delphi" shall mean Delphi Financial Group, Inc., a Delaware corporation.

                                   ARTICLE II

                                    GUARANTEE

SECTION 2.1 Guarantee

     The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by the Issuer), as and when due, regardless of any defense, right of set-off or
counterclaim which the Issuer may have or assert. The Guarantor's obligation to
make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or by causing the Issuer to pay such
amounts to the Holders.

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                                      -4-

SECTION 2.2 Waiver of Notice and Demand

     The Guarantor hereby waives notice of acceptance of this Common Securities
Guarantee and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the Issuer
or any other Person before proceeding against the Guarantor, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices and
demands.

SECTION 2.3 Obligations Not Affected

     The obligations, covenants, agreements and duties of the Guarantor under
this Common Securities Guarantee shall in no way be affected or impaired by
reason of the happening from time to time of any of the following:

          (a) the release or waiver, by operation of law or otherwise, of the
     performance or observance by the Issuer of any express or implied
     agreement, covenant, term or condition relating to the Common Securities to
     be performed or observed by the Issuer;

          (b) the extension of time for the payment by the Issuer of all or any
     portion of the Distributions, Redemption Price, Liquidation Distribution or
     any other sums payable under the terms of the Common Securities or the
     extension of time for the performance of any other obligation under,
     arising out of, or in connection with, the Common Securities (other than an
     extension of time for payment of Distributions or other sum payable that
     results from the extension of any interest payment period on the
     Subordinated Notes permitted by the Indenture);

          (c) any failure, omission, delay or lack of diligence on the part of
     the Holders to enforce, assert or exercise any right, privilege, power or
     remedy conferred on the Holders pursuant to the terms of the Common
     Securities, or any action on the part of the Issuer granting indulgence or
     extension of any kind;

          (d) the voluntary or involuntary liquidation, dissolution, sale of any
     collateral, receivership, insolvency, bankruptcy, assignment for the
     benefit of creditors, reorganization, arrangement, composition or
     readjustment of debt of, or other similar proceedings affecting, the Issuer
     or any of the assets of the Issuer;

          (e) any invalidity of, or defect or deficiency in, the Common
     Securities;

          (f) the settlement or compromise of any obligation guaranteed hereby
     or hereby incurred; or

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                                      -5-

          (g) any other circumstance whatsoever that might otherwise constitute
     a legal or equitable discharge or defense of a guarantor;

it being the intent of this Section 2.3 that the obligations of the Guarantor
hereunder shall be absolute and unconditional under any and all circumstances.

     There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the foregoing.

SECTION 2.4 Rights of Holders

     The Guarantor expressly acknowledges that any Holder of Common Securities
may institute a legal proceeding directly against the Guarantor to enforce its
rights under this Common Securities Guarantee, without first instituting a legal
proceeding against the Issuer or any other Person.

SECTION 2.5 Guarantee of Payment

     This Common Securities Guarantee creates a guarantee of payment and not of
collection.

SECTION 2.6 Subrogation

     The Guarantor shall be subrogated to all (if any) rights of the Holders of
Common Securities against the Issuer in respect of any amounts paid to such
Holders by the Guarantor under this Common Securities Guarantee; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any rights which
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Common Securities
Guarantee, if, at the time of any such payment, any amounts are due and unpaid
under this Common Securities Guarantee. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the Holders.

SECTION 2.7 Independent Obligations

     The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Issuer with respect to the Common Securities and that
the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Common Securities Guarantee
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 2.3 hereof.

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                                   ARTICLE III

                    LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 3.1 Limitation of Transactions

     (a) So long as any Common Securities remain outstanding, if (i) the
Guarantor shall be in default with respect to its Guarantee Payments or other
obligations hereunder, or (ii) if an Event of Default (as defined in the
Indenture) shall exist then (a) the Guarantor shall not declare or pay any
dividend on, or make any distributions with respect to, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of its capital stock
and (b) the Guarantor shall not make any payment of interest, principal or
premium, if any, on or repay, repurchase or redeem any debt securities issued by
the Guarantor which rank pari passu with or junior to the Subordinated Notes.

     (b) Notwithstanding subsection 3.1(a) or any other language to the contrary
contained in this Common Securities Guarantee, nothing shall prevent the
Guarantor from: (i) declaring or paying any dividend on, or making any
distribution with respect to, or redeeming, purchasing, acquiring or making a
liquidation payment with respect to, any of its capital stock in or with (x)
securities of the Guarantor (including capital stock) that rank junior to such
capital stock or (y) securities (including capital stock) of Delphi or (ii)
paying any interest, principal or premium on, or repaying, repurchasing or
redeeming, any debt securities issued by the Guarantor which rank pari passu
with or junior to the Subordinated Notes, with (x) securities of the Guarantor
(including capital stock) that rank junior to such debt securities or (y)
securities (including capital stock) of Delphi.

SECTION 3.2 Ranking

     This Common Securities Guarantee will constitute an unsecured obligation of
the Guarantor and will rank (i) subordinate and junior in right of payment to
all other liabilities of the Guarantor, including the Subordinated Notes and the
Preferred Securities Guarantee, except those liabilities of the Guarantor made
pari passu or subordinate by their terms, (ii) pari passu with the most senior
preferred stock issued from time to time by the Guarantor and with any guarantee
now or hereafter entered into by the Guarantor in respect of any preferred stock
of any Subsidiary or Affiliate of the Guarantor, except the Preferred Securities
Guarantee, and (iii) senior to the Guarantor's common stock.

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                                   ARTICLE IV

                                   TERMINATION

SECTION 4.1 Termination

     This Common Securities Guarantee shall terminate upon the first to occur of
(i) full payment of the Redemption Price of all Common Securities, (ii) the
distribution of Subordinated Notes to the Holders of all of the Common
Securities or (iii) the full payment of the amounts payable in accordance with
the Declaration upon liquidation of the Issuer. Notwithstanding the foregoing,
this Common Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Common Securities
must restore payment of any sums paid under the Common Securities or under this
Common Securities Guarantee.

                                    ARTICLE V

                                  MISCELLANEOUS

SECTION 5.1 Successors and Assigns

     All guarantees and agreements contained in this Common Securities Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Holders of the Common
Securities then outstanding.

SECTION 5.2 Amendments

     Except with respect to any changes which do not adversely affect the rights
of Holders (in which case no consent of Holders will be required), this Common
Securities Guarantee may only be amended with the prior approval of the Holders
of at least a majority in liquidation amount of all the outstanding Common
Securities. The provisions of Section 12.2 of the Declaration with respect to
meetings of Holders of the Securities apply to the giving of such approval.

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                                      -8-

SECTION 5.3 Notices

     All notices provided for in this Common Securities Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:

          (a) if given to the Issuer, in care of the Regular Trustees at the
     Issuer's mailing address set forth below (or such other address as the
     Issuer may give notice of to the Holders of the Common Securities):

                           Delphi Finance Trust I
                           c/o Delphi Financial Group, Inc.
                           1105 North Market Street
                           Suite 1230
                           P.O. Box 8985
                           Wilmington, Delaware 19899
                           Attention:  Chad W. Coulter

          (b) if given to the Guarantor, at the Guarantor's mailing address set
     forth below (or such other address as the Guarantor may give notice of to
     the Holders of the Common Securities):

                           Delphi Financial Group, Inc.
                           1105 North Market Street
                           Suite 1230
                           P.O. Box 8985
                           Wilmington, Delaware 19899
                           Attention:  Chad W. Coulter

          (c) if given to any Holder of Common Securities, at the address set
     forth on the books and records of the Issuer.

     All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.

SECTION 5.4 Benefit

     This Common Securities Guarantee is solely for the benefit of the Holders
of the Common Securities and is not separately transferable from the Common
Securities.

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SECTION 5.5 Governing Law

     THIS COMMON SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

SECTION 5.6 No Recourse Against Certain Persons

     No past, present or future director, officer, employee or stockholder, as
such, of the Guarantor or any successor thereof shall have any liability for any
obligations of the Guarantor under this Preferred Securities Guarantee or for
any claim based on, in respect of, or by reason of, such obligations or their
creation and all such liability is hereby waived and released. Such waiver and
release are part of the consideration for the issue of this Common Securities
Guarantee and the Common Securities.

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                                      -10-

     IN WITNESS WHEREOF, DELPHI FINANCIAL GROUP, INC. has caused this Common
Securities Guarantee Agreement to be duly executed as a deed the day and year
first before written.

                                  ---------------------------
                                  Name:
                                  Title:Exhibit 4.13

                      ====================================

                    PREFERRED SECURITIES GUARANTEE AGREEMENT

                          DELPHI FINANCIAL GROUP, INC.

                                  Dated as of ,

                      ====================================

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                                TABLE OF CONTENTS

                                                                            Page

                           ARTICLE I

                DEFINITIONS AND INTERPRETATION

SECTION 1.1.    Definitions and Interpretation...............................2

                          ARTICLE II

                      TRUST INDENTURE ACT

SECTION 2.1.    Trust Indenture Act; Application.............................6
SECTION 2.2.    Lists of Holders of Securities...............................6
SECTION 2.3.    Reports by the Preferred Guarantee Trustee...................6
SECTION 2.4.    Periodic Reports to Preferred Guarantee Trustee..............7
SECTION 2.5.    Evidence of Compliance with Conditions Precedent.............7
SECTION 2.6.    Events of Default; Waiver....................................7
SECTION 2.7.    Events of Default; Notice....................................7
SECTION 2.8.    Conflicting Interests........................................8

                          ARTICLE III

                 POWERS, DUTIES AND RIGHTS OF
                  PREFERRED GUARANTEE TRUSTEE

SECTION 3.1.    Powers and Duties of the Preferred Guarantee Trustee..........8
SECTION 3.2.    Certain Rights of Preferred Guarantee Trustee................10
SECTION 3.3.    Not Responsible for Recitals or Issuance of Guarantee........13

                          ARTICLE IV

                  PREFERRED GUARANTEE TRUSTEE

SECTION 4.1.    Preferred Guarantee Trustee; Eligibility.....................13
SECTION 4.2.    Appointment, Removal and Resignation of Preferred Guarantee
                 Trustees....................................................14

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                           ARTICLE V

                           GUARANTEE

SECTION 5.1.    Guarantee....................................................15
SECTION 5.2.    Waiver of Notice and Demand..................................15
SECTION 5.3.    Obligations Not Affected.....................................15
SECTION 5.4.    Rights of Holders............................................16
SECTION 5.5.    Guarantee of Payment.........................................17
SECTION 5.6.    Subrogation..................................................17
SECTION 5.7.    Independent Obligations......................................18

                          ARTICLE VI

                    LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.1.    Limitation of Transactions...................................18
SECTION 6.2.    Ranking......................................................19

                          ARTICLE VII

                          TERMINATION

SECTION 7.1.    Termination..................................................19

                         ARTICLE VIII

                        INDEMNIFICATION

SECTION 8.1.    Exculpation..................................................19
SECTION 8.2.    Indemnification..............................................20

                          ARTICLE IX

                         MISCELLANEOUS

SECTION 9.1.    Successors and Assigns.......................................21
SECTION 9.2.    Amendments...................................................21
SECTION 9.3.    Notices......................................................22
SECTION 9.4.    Benefit......................................................23
SECTION 9.5.    Governing Law................................................23
SECTION 9.6.    No Recourse Against Certain Persons..........................23

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                    PREFERRED SECURITIES GUARANTEE AGREEMENT

     This GUARANTEE AGREEMENT (the "Preferred Securities Guarantee"), dated as ,
2002, is executed and delivered by Delphi Financial Group, Inc., a Delaware
corporation (the "Guarantor"), and [ ], as trustee (the "Preferred Guarantee
Trustee"), for the benefit of the Holders (as defined herein) from time to time
of the Preferred Securities (as defined herein) of Delphi Finance Trust I [ ], a
Delaware statutory business trust (the "Issuer").

                                   WITNESSETH:

     WHEREAS, pursuant to an amended and restated Declaration of Trust (the
"Declaration"), dated as of , 2002, among the trustees of the Issuer named
therein, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof [ ] preferred securities having an aggregate
liquidation amount of $[ ] designated the [ ]% Trust Preferred Securities (the
"Preferred Securities");

     WHEREAS, as incentive for the Holders to purchase the Preferred Securities,
the Guarantor desires irrevocably and unconditionally to agree, to the extent
set forth in this Preferred Securities Guarantee, to pay to the Holders of the
Preferred Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein;

     WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Common Securities Guarantee") with substantially identical terms
as this Preferred Securities Guarantee for the benefit of the holders of the
Common Securities (as defined herein), except that if an Indenture Event of
Default (as defined herein), has occurred and is continuing, the rights of
holders of the Common Securities to receive Guarantee Payments under the Common
Securities Guarantee are subordinated to the rights of Holders of Preferred
Securities to receive Guarantee Payments under this Preferred Securities
Guarantee.

     NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guaran-

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                                      -2-

tor, the Guarantor executes and delivers this Preferred Securities Guarantee for
the benefit of the Holders.

                                    ARTICLE I

                         DEFINITIONS AND INTERPRETATION

SECTION 1.1.               Definitions and Interpretation

     In this Preferred Securities Guarantee, unless the context otherwise
requires:

     (a)  capitalized terms used in this Preferred Securities Guarantee but not
          defined in the preamble above have the respective meanings assigned to
          them in this Section 1.1;

     (b)  a term defined anywhere in this Preferred Securities Guarantee has the
          same meaning throughout;

     (c)  all references to "the Preferred Securities Guarantee" or "this
          Preferred Securities Guarantee" are to this Preferred Securities
          Guarantee as modified, supplemented or amended from time to time;

     (d)  all references in this Preferred Securities Guarantee to Articles and
          Sections are to Articles and Sections of this Preferred Securities
          Guarantee, unless otherwise specified;

     (e)  a term defined in the Trust Indenture Act has the same meaning when
          used in this Preferred Securities Guarantee, unless otherwise defined
          in this Preferred Securities Guarantee or unless the context otherwise
          requires; and

     (f)  a reference to the singular includes the plural and vice versa.

     "Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act of 1933, as amended, or any successor rule thereunder.

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                                      -3-

     "Business Day" means any day other than a Saturday, a Sunday or any other
day on which banking institutions in New York, New York are authorized or
required by law to close.

     "Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.

     "Covered Person" means any Holder or beneficial owner of Preferred
Securities.

     "Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Preferred Securities Guarantee after giving
effect to all applicable cure periods.

     "Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by the Issuer: (i) any accrued and unpaid Distributions (as defined in the
Declaration) that are required to be paid on such Preferred Securities to the
extent the Issuer has funds available therefor, (ii) the redemption price,
including all accrued and unpaid Distributions to the date of redemption (the
"Redemption Price"), to the extent the Issuer has funds available therefor, with
respect to any Preferred Securities called for redemption by the Issuer, and
(iii) upon a voluntary or involuntary dissolution, winding-up or termination of
the Issuer (other than in connection with the distribution of Subordinated Notes
to the Holders in exchange for Preferred Securities as provided in the
Declaration), the lesser of (a) the aggregate of the liquidation amount and all
accrued and unpaid Distributions on the Preferred Securities to the date of
payment, to the extent the Issuer shall have funds available therefor, and (b)
the amount of assets of the Issuer remaining available for distribution to
Holders in liquidation of the Issuer (in either case, the "Liquidation
Distribution"). If an Indenture Event of Default has occurred and is continuing,
the rights of holders of the Common Securities to receive payments under the
Common Securities Guarantee are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments.

     "Holder" shall mean any holder, as registered on the books and records of
the Issuer, of any Preferred Securities; provided, however, that, in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.

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                                      -4-

     "Indemnified Person" means the Preferred Guarantee Trustee, any Affiliate
of the Preferred Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives or agents of the Preferred
Guarantee Trustee.

     "Indenture" means the Indenture dated as of , 2002, between the Guarantor
and [ ], as trustee, [and the First Supplemental Indenture thereto] pursuant to
which certain subordinated debt securities of the Guarantor are to be issued to
the Property Trustee (as defined in the Declaration), as from time to time
amended.

     "Indenture Event of Default" has the same meaning as that given to the term
"Event of Default" in the Indenture.

     "Majority in liquidation amount of the Securities" means, except as
provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting separately as a class, of more than 50% of the liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined) of all Preferred Securities
outstanding as of the date of determination.

     "Officers' Certificate" means, with respect to any Person, a certificate
signed by two Authorized Officers (as defined in the Declaration) of such
Person. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Preferred Securities Guarantee shall
include:

          (a) a statement that each officer signing the Officers' Certificate
     has read the covenant or condition;

          (b) a brief statement of the nature and scope of the examination or
     investigation undertaken by each officer in rendering the Officers'
     Certificate;

          (c) a statement that each such officer has made such examination or
     investigation as, in such officer's opinion, is necessary to enable such
     officer to express an informed opinion as to whether or not such covenant
     or condition has been complied with; and

          (d) a statement as to whether, in the opinion of each such officer,
     such condition or covenant has been complied with.

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                                      -5-

     "Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.

     "Preferred Guarantee Trustee" means [ ], until a Successor Preferred
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Preferred Securities Guarantee and thereafter means each
such Successor Preferred Guarantee Trustee.

     "Property Trustee" shall have the meaning ascribed to such term in the
Declaration.

     "Responsible Officer" means, with respect to the Preferred Guarantee
Trustee, (a) any vice president, any assistant vice president, any assistant
secretary, the treasurer, any assistant treasurer, any trust officer or
assistant trust officer or any other officer of the corporate trust department
of the Preferred Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject and (b) who shall have direct responsibility for the
administration of this Agreement.

     "Subordinated Notes" means the series of subordinated debt securities of
the Guarantor designated the [ ]% Subordinated Deferrable Interest Notes due ,
20 held by the Property Trustee.

     "Successor Preferred Guarantee Trustee" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.1.

     "Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.

     "Delphi" means Delphi Financial Group, Inc., a Delaware corporation.

<PAGE>
                                      -6-

                                   ARTICLE II

                               TRUST INDENTURE ACT

SECTION 2.1. Trust Indenture Act; Application

     (a) This Preferred Securities Guarantee is subject to the provisions of the
Trust Indenture Act that are required to be part of this Preferred Securities
Guarantee and shall, to the extent applicable, be governed by such provisions.

     (b) If and to the extent that any provision of this Preferred Securities
Guarantee limits, qualifies or conflicts with the duties imposed by Section 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.

                       SECTION 2.2.               Lists of Holders of Securities

     (a) The Guarantor shall provide the Preferred Guarantee Trustee with a
list, in such form as the Preferred Guarantee Trustee may reasonably require, of
the names and addresses of the Holders of the Preferred Securities ("List of
Holders") (i) as of January 1 and June 30 of each year, within 20 Business Days
thereafter, and (ii) at any other time within 30 days of receipt by the
Guarantor of a written request from the Preferred Guarantee Trustee for a List
of Holders, which shall be as of a date no more than 14 days before such List of
Holders is given to the Preferred Guarantee Trustee; provided, however, that the
Guarantor shall not be obligated to provide such List of Holders at any time the
List of Holders does not differ from the most recent List of Holders given to
the Preferred Guarantee Trustee by the Guarantor. The Preferred Guarantee
Trustee may destroy any List of Holders previously given to it on receipt of a
new List of Holders.

     (b) The Preferred Guarantee Trustee shall comply with its obligations under
Section 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.

SECTION 2.3. Reports by the Preferred Guarantee Trustee

     Within 60 days after each May 15 of each year, the Preferred Guarantee
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The

<PAGE>
                                      -7-

Preferred Guarantee Trustee shall also comply with the requirements of Section
313(d) of the Trust Indenture Act.

SECTION 2.4. Periodic Reports to Preferred Guarantee Trustee

     The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as required by Section 314 of the Trust
Indenture Act (if any) and the compliance certificate required by Section 314 of
the Trust Indenture Act in the form, in the manner and at the times required by
Section 314 of the Trust Indenture Act.

SECTION 2.5. Evidence of Compliance with Conditions Precedent

     The Guarantor shall provide to the Preferred Guarantee Trustee with a
certification of compliance with any conditions precedent, if any, provided for
in this Preferred Securities Guarantee that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) of the Trust
Indenture Act may be given in the form of an Officers' Certificate.

SECTION 2.6. Events of Default; Waiver

     The Holders of a Majority in liquidation amount of Preferred Securities
may, by vote, on behalf of the Holders of all of the Preferred Securities, waive
any past Event of Default and its consequences. Upon such waiver, any such Event
of Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured, for every purpose of this Preferred
Securities Guarantee, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.

SECTION 2.7. Events of Default; Notice

     (a) The Preferred Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default that is actually known to the Preferred
Guarantee Trustee (or as soon as reasonably practical thereafter), transmit by
mail, first class postage prepaid, to the Holders of the Preferred Securities,
notices of all Events of Default actually known to the Preferred Guarantee
Trustee, unless such defaults have been cured before the giving of such notice;
provided, however, that the Preferred Guarantee Trustee shall be protected in
withholding

<PAGE>
                                      -8-

such notice if and so long as the board of directors, the executive committee,
or a trust committee of directors and/or Responsible Officers of the Preferred
Guarantee Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders of the Preferred Securities.

     (b) The Preferred Guarantee Trustee shall not be deemed to have knowledge
of any Event of Default unless the Preferred Guarantee Trustee shall have
received actual knowledge, or a Responsible Officer charged with the
administration of the Declaration shall have obtained written notice, of such
Event of Default.

SECTION 2.8. Conflicting Interests

     The Declaration shall be deemed to be specifically described in this
Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.

                                   ARTICLE III

                          POWERS, DUTIES AND RIGHTS OF
                           PREFERRED GUARANTEE TRUSTEE

SECTION 3.1. Powers and Duties of the Preferred Guarantee Trustee

     (a) This Preferred Securities Guarantee shall be held by the Preferred
Guarantee Trustee for the benefit of the Holders of the Preferred Securities,
and the Preferred Guarantee Trustee shall not transfer this Preferred Securities
Guarantee to any Person except a Holder of Preferred Securities exercising his
or her rights pursuant to Section 5.4(b) or to a Successor Preferred Guarantee
Trustee on acceptance by such Successor Preferred Guarantee Trustee of its
appointment to act as Successor Preferred Guarantee Trustee. The right, title
and interest of the Preferred Guarantee Trustee shall automatically vest in any
Successor Preferred Guarantee Trustee, and such vesting (and cessation as to the
Preferred Guarantee Trustee) of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Preferred Guarantee Trustee.

     (b) If an Event of Default has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this

<PAGE>
                                      -9-

Preferred Securities Guarantee for the benefit of the Holders of the Preferred
Securities.

     (c) The Preferred Guarantee Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Preferred Securities Guarantee, and no implied covenants shall be read into
this Preferred Securities Guarantee against the Preferred Guarantee Trustee. In
case an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6), the Preferred Guarantee Trustee shall exercise such of
the rights and powers vested in it by this Preferred Securities Guarantee, and
use the same degree of care and skill in its exercise thereof, as a prudent
person would exercise or use under the circumstances in the conduct of his or
her own affairs.

     (d) No provision of this Preferred Securities Guarantee shall be construed
to relieve the Preferred Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:

          (i) prior to the occurrence of any Event of Default and after the
     curing or waiving of all such Events of Default that may have occurred:

               (A) the duties and obligations of the Preferred Guarantee Trustee
          shall be determined solely by the express provisions of this Preferred
          Securities Guarantee, and the Preferred Guarantee Trustee shall not be
          liable except for the performance of such duties and obligations as
          are specifically set forth in this Preferred Securities Guarantee, and
          no implied covenants or obligations shall be read into this Preferred
          Securities Guarantee against the Preferred Guarantee Trustee; and

               (B) in the absence of bad faith on the part of the Preferred
          Guarantee Trustee, the Preferred Guarantee Trustee may conclusively
          rely, as to the truth of the statements and the correctness of the
          opinions expressed therein, upon any certificates or opinions
          furnished to the Preferred Guarantee Trustee and conforming to the
          requirements of this Preferred Securities Guarantee; but in the case
          of any such certificates or opinions that by any provision hereof are
          specifically required to be furnished to the Pre-

<PAGE>
                                      -10-

     ferred Guarantee Trustee, the Preferred Guarantee Trustee shall be under a
     duty to examine the same to determine whether or not they conform to the
     requirements of this Preferred Securities Guarantee (but need not confirm
     or investigate the accuracy of mathematical calculations or other facts
     stated therein);

          (ii) the Preferred Guarantee Trustee shall not be liable for any error
     of judgment made in good faith by a Responsible Officer of the Preferred
     Guarantee Trustee, unless it shall be proved that the Preferred Guarantee
     Trustee was negligent in ascertaining the pertinent facts upon which such
     judgment was made;

          (iii) the Preferred Guarantee Trustee shall not be liable with respect
     to any action taken or omitted to be taken by it in good faith in
     accordance with the direction of the Holders of not less than a Majority in
     liquidation amount of the Preferred Securities relating to the time, method
     and place of conducting any proceeding for any remedy available to the
     Preferred Guarantee Trustee, or exercising any trust or power conferred
     upon the Preferred Guarantee Trustee under this Preferred Securities
     Guarantee; and

          (iv) no provision of this Preferred Securities Guarantee shall require
     the Preferred Guarantee Trustee to expend or risk its own funds or
     otherwise incur personal financial liability in the performance of any of
     its duties or in the exercise of any of its rights or powers, if the
     Preferred Guarantee Trustee shall have reasonable grounds for believing
     that the repayment of such funds or liability is not reasonably assured to
     it under the terms of this Preferred Securities Guarantee or adequate
     indemnity against such risk or liability is not reasonably assured to it.

SECTION 3.2. Certain Rights of Preferred Guarantee Trustee

     (a) Subject to the provisions of Section 3.1:

          (i) The Preferred Guarantee Trustee may conclusively rely, and shall
     be fully protected in acting or refraining from acting upon, any
     resolution, certificate, statement, instrument, opinion, report, notice,
     request, direction, consent, order, bond, debenture, note, other evidence
     of

<PAGE>
                                      -11-

     indebtedness or other paper or document believed by it to be genuine and to
     have been signed, sent or presented by the proper party or parties.

          (ii) Any direction or act of the Guarantor contemplated by this
     Preferred Securities Guarantee shall be sufficiently evidenced by a
     Direction (as defined in the Declaration) or an Officers' Certificate.

          (iii) Whenever, in the administration of this Preferred Securities
     Guarantee, the Preferred Guarantee Trustee shall deem it desirable that a
     matter be proved or established before taking, suffering or omitting any
     action hereunder, the Preferred Guarantee Trustee (unless other evidence is
     herein specifically prescribed) may, in the absence of bad faith on its
     part, request and conclusively rely upon an Officers' Certificate which,
     upon receipt of such request, shall be promptly delivered by the Guarantor.

          (iv) The Preferred Guarantee Trustee shall have no duty to see to any
     recording, filing or registration of any instrument (or any rerecording,
     refiling or reregistration thereof).

          (v) The Preferred Guarantee Trustee may consult with counsel of its
     selection, and the advice or opinion of such counsel with respect to legal
     matters shall be full and complete authorization and protection in respect
     of any action taken, suffered or omitted by it hereunder in good faith and
     in accordance with such advice or opinion. Such counsel may be counsel to
     the Guarantor or any of its Affiliates and may include any of its
     employees. The Preferred Guarantee Trustee shall have the right at any time
     to seek instructions concerning the administration of this Preferred
     Securities Guarantee from any court of competent jurisdiction.

          (vi) The Preferred Guarantee Trustee shall be under no obligation to
     exercise any of the rights or powers vested in it by this Preferred
     Securities Guarantee at the request or direction of any Holder, unless such
     Holder shall have provided to the Preferred Guarantee Trustee such adequate
     security and indemnity as would satisfy a reasonable person in the position
     of the Preferred Guarantee Trustee, against the costs, expenses (including
     attorneys' fees and expenses) and liabilities that might be incurred by it
     in complying with such request or direction,

<PAGE>
                                      -12-

     including such reasonable advances as may be requested by the Preferred
     Guarantee Trustee; provided, however, that nothing contained in this
     Section 3.2(a)(vi) shall be taken to relieve the Preferred Guarantee
     Trustee, upon the occurrence of an Event of Default, of its obligation to
     exercise the rights and powers vested in it by this Preferred Securities
     Guarantee.

          (vii) The Preferred Guarantee Trustee shall not be bound to make any
     investigation into the facts or matters stated in any resolution,
     certificate, statement, instrument, opinion, report, notice, request,
     direction, consent, order, bond, debenture, note, other evidence of
     indebtedness or other paper or document, but the Preferred Guarantee
     Trustee, in its discretion, may make such further inquiry or investigation
     into such facts or matters as it may see fit.

          (viii) The Preferred Guarantee Trustee may execute any of the trusts
     or powers hereunder or perform any duties hereunder either directly or by
     or through agents or attorneys, and the Preferred Guarantee Trustee shall
     not be responsible for any misconduct or negligence on the part of any
     agent or attorney appointed with due care by it hereunder.

          (ix) Any action taken by the Preferred Guarantee Trustee or its agents
     hereunder shall bind the Holders of the Preferred Securities, and the
     signature of the Preferred Guarantee Trustee or its agents alone shall be
     sufficient and effective to perform any such action. No third party shall
     be required to inquire as to the authority of the Preferred Guarantee
     Trustee to so act or as to its compliance with any of the terms and
     provisions of this Preferred Securities Guarantee, both of which shall be
     conclusively evidenced by the Preferred Guarantee Trustee's or its agent's
     taking such action.

          (x) Whenever in the administration of this Preferred Securities
     Guarantee the Preferred Guarantee Trustee shall deem it desirable to
     receive instructions with respect to enforcing any remedy or right or
     taking any other action hereunder, the Preferred Guarantee Trustee (i) may
     request instructions from the Holders of a Majority in liquidation amount
     of the Preferred Securities, (ii) may refrain from enforcing such remedy or
     right or taking such other action until such instructions are received, and
     (iii) shall be protected in acting in accordance with such instructions.

<PAGE>
                                      -13-

     (b) No provision of this Preferred Securities Guarantee shall be deemed to
impose any duty or obligation on the Preferred Guarantee Trustee to perform any
act or acts or exercise any right, power, duty or obligation conferred or
imposed on it in any jurisdiction in which it shall be illegal, or in which the
Preferred Guarantee Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or authority available to
the Preferred Guarantee Trustee shall be construed to be a duty.

SECTION 3.3. Not Responsible for Recitals or Issuance of Guarantee

     The recitals contained in this Preferred Securities Guarantee shall be
taken as the statements of the Guarantor, and the Preferred Guarantee Trustee
does not assume any responsibility for their correctness. The Preferred
Guarantee Trustee makes no representation as to the validity or sufficiency of
this Preferred Securities Guarantee.

                                   ARTICLE IV

                          PREFERRED GUARANTEE TRUSTEE

SECTION 4.1. Preferred Guarantee Trustee; Eligibility

     (a) There shall at all times be a Preferred Guarantee Trustee which shall:

          (i) not be an Affiliate of the Guarantor; and

          (ii) be a corporation organized and doing business under the laws of
     the United States of America or any State or Territory thereof or of the
     District of Columbia, or a corporation or Person permitted by the
     Securities and Exchange Commission to act as an institutional trustee under
     the Trust Indenture Act, authorized under such laws to exercise corporate
     trust powers, having (or in the case of a subsidiary of a bank holding
     company that guarantees the obligations of the Preferred Guarantee Trustee
     under this Preferred Securities Guarantee, such bank holding company parent
     shall have) a combined capital and surplus of at least 50 million U.S.
     dollars ($50,000,000), and subject to supervision or examination by
     Federal, State, Territorial or District of Columbia authority. If such
     corpora-

<PAGE>
                                      -14-

     tion or holding company parent publishes reports of condition at least
     annually, pursuant to law or to the requirements of the supervising or
     examining authority referred to above, then, for the purposes of this
     Section 4.1(a)(ii), the combined capital and surplus of such corporation or
     holding company parent shall be deemed to be its combined capital and
     surplus as set forth in its most recent report of condition so published.

     (b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Preferred Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2(c).

     (c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Preferred Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.

SECTION 4.2. Appointment, Removal and Resignation of Preferred Guarantee
             Trustees

     (a) Subject to Section 4.2(b), the Preferred Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.

     (b) The Preferred Guarantee Trustee shall not be removed in accordance with
Section 4.2(a) until a Successor Preferred Guarantee Trustee has been appointed
and has accepted such appointment by written instrument executed by such
Successor Preferred Guarantee Trustee and delivered to the Guarantor.

     (c) The Preferred Guarantee Trustee appointed to office shall hold office
until a Successor Preferred Guarantee Trustee shall have been appointed or until
its removal or resignation. The Preferred Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an instrument in
writing executed by the Preferred Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Preferred
Guarantee Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor Preferred Guarantee Trustee and
delivered to the Guarantor and the resigning Preferred Guarantee Trustee.

     (d) If no Successor Preferred Guarantee Trustee shall have been appointed
and accepted appointment as provided

<PAGE>
                                      -15-

in this Section 4.2 within 30 days after delivery of an instrument of
resignation or removal, the Preferred Guarantee Trustee resigning or being
removed may (at the expense of the Guarantor) petition any court of competent
jurisdiction for appointment of a Successor Preferred Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Preferred Guarantee Trustee.

                                    ARTICLE V

                                    GUARANTEE

SECTION 5.1. Guarantee

     The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by the Issuer), as and when due, regardless of any defense, right of set-off or
counterclaim that the Issuer may have or assert. The Guarantor's obligation to
make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or by causing the Issuer to pay such
amounts to the Holders.

SECTION 5.2. Waiver of Notice and Demand

     The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Issuer or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.

SECTION 5.3. Obligations Not Affected

     The obligations, covenants, agreements and duties of the Guarantor under
this Preferred Securities Guarantee shall in no way be affected or impaired by
reason of the happening from time to time of any of the following:

          (a) the release or waiver, by operation of law or otherwise, of the
     performance or observance by the Issuer of any express or implied
     agreement, covenant, term or condition relating to the Preferred Securities
     to be performed or observed by the Issuer;

<PAGE>
                                      -16-

          (b) the extension of time for the payment by the Issuer of all or any
     portion of the Distributions, Redemption Price, Liquidation Distribution or
     any other sums payable under the terms of the Preferred Securities or the
     extension of time for the performance of any other obligation under,
     arising out of, or in connection with, the Preferred Securities (other than
     an extension of time for payment of Distributions or other sum payable that
     results from the extension of any interest payment period on the
     Subordinated Notes permitted by the Indenture);

          (c) any failure, omission, delay or lack of diligence on the part of
     the Holders to enforce, assert or exercise any right, privilege, power or
     remedy conferred on the Holders pursuant to the terms of the Preferred
     Securities, or any action on the part of the Issuer granting indulgence or
     extension of any kind;

          (d) the voluntary or involuntary liquidation, dissolution, sale of any
     collateral, receivership, insolvency, bankruptcy, assignment for the
     benefit of creditors, reorganization, arrangement, composition or
     readjustment of debt of, or other similar proceedings affecting, the Issuer
     or any of the assets of the Issuer;

          (e) any invalidity of, or defect or deficiency in, the Preferred
     Securities;

          (f) the settlement or compromise of any obligation guaranteed hereby
     or hereby incurred; or

          (g) any other circumstance whatsoever that might otherwise constitute
     a legal or equitable discharge or defense of a guarantor;

it being the intent of this Section 5.3 that the obligations of the Guarantor
hereunder shall be absolute and unconditional under any and all circumstances.

     There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the foregoing.

SECTION 5.4. Rights of Holders

     (a) The Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting of
any proceeding for any remedy

<PAGE>
                                      -17-

available to the Preferred Guarantee Trustee in respect of this Preferred
Securities Guarantee or exercising any trust or power conferred upon the
Preferred Guarantee Trustee under this Preferred Securities Guarantee.

     (b) If the Preferred Guarantee Trustee fails to enforce this Preferred
Securities Guarantee, any Holder of Preferred Securities may institute a legal
proceeding directly against the Guarantor to enforce its rights under this
Preferred Securities Guarantee, without first instituting a legal proceeding
against the Issuer, the Preferred Guarantee Trustee or any other Person.

     (c) Notwithstanding subsection 5.4(b), any Holder of Preferred Securities
may directly institute proceedings against the Guarantor to obtain Guarantee
Payments in respect of the Preferred Securities owned by such Holder, without
first waiting to determine if the Preferred Guarantee Trustee has enforced this
Preferred Securities Guarantee or first instituting a legal proceeding against
the Issuer, the Preferred Guarantee Trustee or any other Person.

SECTION 5.5. Guarantee of Payment

     This Preferred Securities Guarantee creates a guarantee of payment and not
of collection.

SECTION 5.6. Subrogation

     The Guarantor shall be subrogated to all (if any) rights of the Holders of
Preferred Securities against the Issuer in respect of any amounts paid to such
Holders by the Guarantor under this Preferred Securities Guarantee; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any right that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Preferred Securities
Guarantee, if, at the time of any such payment, any amounts are due and unpaid
under this Preferred Securities Guarantee. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the Holders.

<PAGE>
                                      -18-

SECTION 5.7. Independent Obligations

     The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Issuer with respect to the Preferred Securities, and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Preferred Securities Guarantee
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.

                                   ARTICLE VI

                    LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.1. Limitation of Transactions

     (a) So long as any Preferred Securities remain outstanding, if an Event of
Default or Indenture Event of Default shall exist, then (a) the Guarantor shall
not declare or pay any dividend on, or make any distribution with respect to, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
its capital stock, and (b) the Guarantor shall not make any payment of interest,
principal or premium, if any, on or repay, repurchase or redeem any debt
securities issued by the Guarantor which rank pari passu with or junior to the
Subordinated Notes.

     (b) Notwithstanding subsection 6.1(a) or any other language to the contrary
contained in this Preferred Securities Guarantee, nothing shall prevent the
Guarantor from: (i) declaring or paying any dividend on, or making any
distribution with respect to, or redeeming, purchasing, acquiring or making a
liquidation payment with respect to, any of its capital stock in or with
securities of the Guarantor (including capital stock) that rank junior to such
capital stock or (ii) paying any interest, principal or premium on, or repaying,
repurchasing or redeeming, any debt securities issued by the Guarantor which
rank pari passu with or junior to the Subordinated Notes, with (x) securities of
the Guarantor (including capital stock) that rank junior to such debt securities
or (y) securities (including capital stock) of Delphi.

<PAGE>
                                      -19-

SECTION 6.2. Ranking

     This Preferred Securities Guarantee constitutes an unsecured obligation of
the Guarantor and will rank (i) subordinate and junior in right of payment to
all other liabilities of the Guarantor, except those liabilities of the
Guarantor expressly made pari passu with or subordinate to this Preferred
Securities Guarantee by their terms, (ii) pari passu with the most senior
preferred or preference stock issued by the Guarantor from time to time and with
any guarantee now or hereafter entered into by the Guarantor in respect of any
preferred or preference stock of any Affiliate of the Guarantor and (iii) senior
to the Guarantor's common stock.

                                   ARTICLE VII

                                   TERMINATION

SECTION 7.1. Termination

     This Preferred Securities Guarantee shall automatically terminate upon the
earliest to occur of (i) the full payment of the Redemption Price of all
Preferred Securities, (ii) the distribution of Subordinated Notes to the
Holder(s) of all of the Preferred Securities or (iii) full payment of the
amounts payable in accordance with the Declaration upon liquidation of the
Issuer. Notwithstanding the foregoing, this Preferred Securities Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder of Preferred Securities must restore payment of any sums paid
under the Preferred Securities or under this Preferred Securities Guarantee.

                                  ARTICLE VIII

                                 INDEMNIFICATION

SECTION 8.1. Exculpation

     (a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Guarantor or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Pre-

<PAGE>
                                      -20-

ferred Securities Guarantee and in a manner that such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
Indemnified Person by this Preferred Securities Guarantee or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's negligence or willful misconduct
with respect to such acts or omission.

     (b) An Indemnified Person shall be fully protected in relying in good faith
upon the records of the Guarantor and upon such information, opinions, reports
or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions, the Redemption Price or the Liquidation Distribution to
Holders of Preferred Securities might properly be paid.

     (c) The provisions of this Section 8.1 shall survive the termination of
this Preferred Securities Guarantee.

SECTION 8.2. Indemnification

     (a) The Guarantor shall indemnify and hold harmless each Indemnified Person
from and against any loss, damage or claim incurred by such Indemnified Person
by reason of any act or omission performed or omitted by such Indemnified Person
in good faith in accordance with this Preferred Securities Guarantee and in a
manner such Indemnified Person reasonably believed to be within the scope of
authority conferred on such Indemnified Person in accordance with this Preferred
Securities Guarantee, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by such Indemnified
Person by reason of negligence or willful misconduct with respect to such acts
or omissions.

     (b) Expenses (including legal fees and expenses) incurred by an Indemnified
Person in defending any claim, demand, action, suit or proceeding (whether such
claim, demand, action, suit or proceeding arises between the parties hereto or
results from suits involving third parties) shall, from time to time, be
advanced by the Guarantor prior to the final disposition of such claim, demand,
action, suit or proceeding upon receipt by the Guarantor of an undertaking by or
on behalf of the Indemnified Person to repay such amount if it shall be
determined that

<PAGE>
                                      -21-

the Indemnified Person is not entitled to be indemnified as authorized in
Section 8.2(a).

     (c) The Guarantor agrees

          (i) to pay to the Preferred Guarantee Trustee from time to time such
     compensation as the Guarantor and the Preferred Guarantee Trustee shall
     from time to time agree in writing for all services rendered by it
     hereunder (which compensation shall not be limited by any provision of law
     in regard to the compensation of a trustee of an express trust);

          (ii) except as otherwise expressly provided herein, to reimburse the
     Trustee upon its request for all reasonable expenses, disbursements and
     advances incurred or made by the Preferred Guarantee Trustee in accordance
     with any provision of this Agreement (including the reasonable compensation
     and expenses and disbursements of its agents and counsel).

     (d) The provisions of this Section 8.2 shall survive the termination of
this Preferred Securities Guarantee.

                                   ARTICLE IX

                                  MISCELLANEOUS

SECTION 9.1. Successors and Assigns

     All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Preferred Securities then outstanding.

SECTION 9.2. Amendments

     Except with respect to any changes that do not adversely affect the rights
of Holders (in which case no consent of Holders will be required), this
Preferred Securities Guarantee may only be amended with the prior approval of
the Holders of at least a Majority in liquidation amount of the Preferred
Securities. The provisions of Section 12.2 of the Declaration with respect to
meetings of Holders of the Securities apply to the giving of such approval.

<PAGE>
                                      -22-

     In executing, or accepting the additional trusts created by, and amendment
permitted by this Section or the modification thereby of the trust created by
this Agreement, the Preferred Guarantee Trustee shall be entitled to receive,
and shall be fully protected in relying upon, an Opinion of Counsel stating that
the execution of such amendment is authorized or permitted by this Agreement.
The Preferred Guarantee Trustee may, but shall not be obligated to, enter into
any such amendment which affects the Trustee's own rights, duties or immunities
under this Agreement or otherwise.

SECTION 9.3. Notices

     All notices provided for in this Preferred Securities Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by first class mail, as follows:

     (a) If given to the Preferred Guarantee Trustee, at the Preferred Guarantee
Trustee's mailing address set forth below (or such other address as the
Preferred Guarantee Trustee may give notice of to the Holders of the Preferred
Securities):

                  [                 ]
                  [                 ]
                  [                 ]
                  [                 ]

     (b) If given to the Guarantor, at the Guarantor's mailing address set forth
below (or such other address as the Guarantor may give notice of to the Holders
of the Preferred Securities):

                  Delphi Financial Group, Inc.
                  1105 North Market Street
                  Suite 1230
                  P.O. Box 8989
                  Wilmington, Delaware 19899
                  Attention:  Chad W. Coulter

     (c) If given to any Holder of Preferred Securities, at the address set
forth on the books and records of the Issuer.

     All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid.

<PAGE>
                                      -23-

SECTION 9.4. Benefit

     This Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Preferred Securities.

SECTION 9.5. Governing Law

     THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES.

SECTION 9.6. No Recourse Against Certain Persons

     No past, present or future director, officer, employee or stockholder, as
such, of the Guarantor or any successor thereof shall have any liability for any
obligations of the Guarantor under this Preferred Securities Guarantee or for
any claim based on, in respect of, or by reason of, such obligations or their
creation and all such liability is hereby waived and released. Such waiver and
release are part of the consideration for the issue of this Preferred Securities
Guarantee and the Preferred Securities.

<PAGE>
                                      -24-

     IN WITNESS WHEREOF, DELPHI FINANCIAL GROUP, INC. has caused this Preferred
Securities Guarantee Agreement to be duly executed as a deed the day and year
first before written.

                          Name:
                          Title:

<PAGE>
                                      -25-

     IN WITNESS WHEREOF, the undersigned, being duly authorized, has executed
this Preferred Securities Guarantee Agreement as of the date first above
written.

                     [                              ]
                        as Preferred Guarantee Trustee

                     By:
                            ---------------------------------------------------
                            Name:
                            Title:

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