BRISTOL WEST HOLDINGS, INC. NON-EMPLOYEE DIRECTORS' DEFERRED COMPENSATION AND STOCK AWARD PLAN

Deferred Unit Award Agreement

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BRISTOL WEST HOLDINGS INC

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Title: BRISTOL WEST HOLDINGS, INC. NON-EMPLOYEE DIRECTORS' DEFERRED COMPENSATION AND STOCK AWARD PLAN
Date: 11/12/2004

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BRISTOL WEST HOLDINGS, INC.

NON-EMPLOYEE DIRECTORS’ DEFERRED COMPENSATION AND STOCK AWARD PLAN

PURPOSE

The purpose of this Bristol West Holdings, Inc. Non-Employee Directors’ Deferred Compensation and Stock Award Plan is to provide individuals who are not employees of Bristol West Holdings, Inc. or its subsidiaries who serve as members of the Board (as defined below) an opportunity to defer payment of all or a portion of their Fees (as defined below) and to receive current payment of all or a portion of their Fees in Shares (as defined below) in accordance with the terms and conditions set forth herein.

ARTICLE I

DEFINITIONS

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

1.2	"Board" means the Board of Directors of the Company.

1.3

"Beneficial Owner" means a "beneficial owner," as such term is defined in Rule 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended (or any successor rule thereto), which shall in any event include having the power to vote (or cause to be voted) pursuant to contract, irrevocable proxy or otherwise, and which, for purposes of the calculation under clause (y) of the definition of Change in Control, shall be deemed to include shares that any such Person or Group has a right to acquire, whether such right is exercisable immediately or only after the passage of time.

1.4	"Change in Control" means the occurrence of any of the following events:

(i) a sale of all or substantially all of the assets of the Company to a Person or Group that is not Kohlberg Kravis Roberts & Co. or an Affiliate thereof (collectively, the "KKR Partnerships");

(ii) a sale by any member of the KKR Partnerships resulting in more than 50% of the voting stock of the Company being held by a Person or Group that is not a member of the KKR Partnerships; or

(iii) a merger, consolidation, recapitalization or reorganization of the Company with or into another Person which is not a member of the KKR Partnerships;

and following any of the foregoing events in clause (ii)-(iii), (x) the KKR Partnerships no longer have the ability, without the approval of a Person or Group or an Affiliate of the Company that is not a member of the KKR Partnerships, to elect a majority of the Board (or the resulting entity in the transaction) and (y) any Person or Group who is not a member of the KKR Partnerships is or becomes the Beneficial Owner, directly or indirectly, in the aggregate, of a greater percentage of the total voting power of the Company than that held, directly or indirectly, in the aggregate, by the KKR Partnerships.

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1.5	"Committee" means the Compensation Committee of the Board or such other committee as may be appointed by the Board.

1.6	"Company" means Bristol West Holdings, Inc., a Delaware corporation.

1.7	"Director" means a member of the Board who is not an employee of the Company or any of its subsidiaries.

1.8

"Fair Market Value" means, if the Shares are traded on NASDAQ, the Fair Market Value of the Shares as of any date of determination shall be the closing sale price on that date of a Share as reported in the NASDAQ National Market Issues quotations of the New York City Edition of the Wall Street Journal. If the Shares are traded on the New York Stock Exchange, the Fair Market Value of the Shares as of any date of determination shall be the closing sale price on that date of a Share as reported on the New York Stock Exchange Composite Tape (or, if the Shares are not traded on NASDAQ or the New York Stock Exchange, as applicable, on such date, on the next preceding date on which it was so traded); and if there should not be a public market for the Shares on such date, the Fair Market Value shall be the value established by the Committee in good faith.

1.9	"Fees" means amounts (including any annual retainer, which is generally payable in quarterly installments in cash, or upon the election of a Director, in Shares) earned for serving as a member of the Board or any Committee.

1.10	"Group" means a "group" as such term is used in Sections 13(d) and 14(d) of the Act, acting in concert.

1.11	"Shares" means the common shares of the Company, par value $0.01 per share.

1.12	"Person" means a "person," as such term is used for purposes of Section 13(d) or 14(d) of the Act (or any successor section thereto).

1.13	"Plan" means this Bristol West Holdings, Inc. Non-Employee Directors’ Deferred Compensation and Stock Award Plan, as it may be amended from time to time.

1.14	"Share Account" means the account created by the Company pursuant to Article III of this Plan in accordance with an election by a Director to defer Fees and receive share-related compensation under Article II hereof.

1.15	"Year" shall mean calendar year.

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1.16	"He", "Him" or "His" shall apply equally to male and female members of the Board.

ARTICLE II

ELECTION TO DEFER

2.1	A Director may elect, on or before December 31 of any Year, to irrevocably defer payment of all or a specified part of all Fees earned during the Year following such election and succeeding Years (until the Director ceases to be a Director or elects (in writing) to change such election);