SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* VESTA INSURANCE GROUP INC (Last) (First) (Middle) 3760 RIVER RUN DRIVE (Street) BIRMINGHAM AL 35243 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol AFFIRMATIVE INSURANCE HOLDINGS INC [ AFFM ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director X 10% Owner Officer (give title below) Other (specify below)
	3. Date of Earliest Transaction (Month/Day/Year) 07/14/2004
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Common Stock								4,739,685	D(1)
Common Stock	07/14/2004		S(2)		3,750,000(3)	D	$14	2,960,206	I(3)	See Footnote(3)
Common Stock	07/14/2004		S(2)		2,643,324	D	$14	0	D(4)
Common Stock	07/14/2004		S(2)		777,426	D	$14	2,960,206	D(5)
Common Stock	07/14/2004		S(2)		263,400	D	$14	0	D(6)
Common Stock	07/14/2004		S(2)		65,850	D	$14	0	D(7)

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares

1. Name and Address of Reporting Person* VESTA INSURANCE GROUP INC (Last) (First) (Middle) 3760 RIVER RUN DRIVE (Street) BIRMINGHAM AL 35243 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Vesta Fire Insurance CORP (Last) (First) (Middle) 3760 RIVER RUN DRIVE (Street) BIRMINGHAM AL 35243 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* SHELBY INSURANCE CO (Last) (First) (Middle) 3760 RIVER RUN DRIVE (Street) BIRMINGHAM AL 35243 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Shelby Casualty Insurance CO (Last) (First) (Middle) 3760 RIVER RUN DRIVE (Street) BIRMINGHAM AL 35243 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Hawaiian Insurance & Guaranty Company, Ltd. (Last) (First) (Middle) 3760 RIVER RUN DRIVE (Street) BIRMINGHAM AL 35243 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

Explanation of Responses:

1. Shares owned directly by Vesta Insurance Group, Inc. Vesta Insurance Group, Inc. did not sell any of the shares it directly owns in the transactions reported in this Table I.

2. Sold in the initial public offering of the issuer's common stock.

3. As described in footnotes 4-7, an aggregate of 3,750,000 shares were sold in the transactions reported in this Table I by four wholly owned subsidiaries of Vesta Insurance Group, Inc., which are joint filers of this report. Vesta Insurance Group, Inc. was an indirect beneficial owner of all 3,750,000 of these shares. Following the reported transactions, Vesta Insurance Group, Inc. beneficially owns a total of 7,699,891 shares, of which 2,960,206 are owned indirectly.

4. Shares owned directly by Vesta Fire Insurance Corporation, a wholly owned subsidiary of Vesta Insurance Group, Inc. Vesta Insurance Group, Inc. is an indirect beneficial owner of the reported securities.

5. Shares owned directly by The Shelby Insurance Company, a wholly owned subsidiary of Vesta Fire Insurance Corporation. Vesta Fire Insurance Corporation and Vesta Insurance Group, Inc. are indirect beneficial owners of the reported securities.

6. Shares owned directly by Shelby Casualty Insurance Company, a wholly owned subsidiary of Vesta Fire Insurance Corporation. Vesta Fire Insurance Corporation and Vesta Insurance Group, Inc. are indirect beneficial owners of the reported securities.

7. Shares owned directly by The Hawaiian Insurance and Guaranty Company, Ltd., an indirect wholly owned subsidiary of Vesta Fire Insurance Corporation. Vesta Fire Insurance Corporation and Vesta Insurance Group, Inc. are indirect beneficial owners of the reported securities.

	/s/ John W. McCullough, Vice President and Associate General Counsel, Vesta Insurance Group, Inc	07/14/2004
	/s/ John W. McCullough, Authorized Representative, Vesta Fire Insurance Corporation	07/14/2004
	/s/ John W. McCullough, Authorized Representative, The Shelby Insurance Company	07/14/2004
	/s/ John W. McCullough, Authorized Representative, Shelby Casualty Insurance Company	07/14/2004
	/s/ John W. McCullough, Authorized Representative, The Hawaiian Insurance and Guaranty Company, LTD.	07/14/2004
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.