FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person * KELBEL CRAIG J   2. Issuer Name and Ticker or Trading Symbol HCC INSURANCE HOLDINGS INC/DE/ [HCC] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) _____ Director _____ 10% Owner __X__ Officer (give title below) _____ Other (specify below) Executive Vice President (Last) (First) (Middle) 13403 NORTHWEST FREEWAY, C/O HCC INSURANCE HOLDINGS 3. Date of Earliest Transaction (Month/Day/Year) 01/04/2006 (Street) HOUSTON, TX 77040 4. If Amendment, Date Original Filed(Month/Day/Year) 6. Individual or Joint/Group Filing(Check Applicable Line) _X_ Form filed by One Reporting Person ___ Form filed by More than One Reporting Person (City) (State) (Zip) 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 01/04/2006   M   37,500 A $ 16.8 37,500 D   Common Stock 01/04/2006   S   37,500 D $ 29.9558 0 D

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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 Underlying Securities (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 of Derivative Security: 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

Option to Purchase (1)

$ 23.7

(2)

12/31/2010

Common Stock

112,500

112,500

D

Option to Purchase (1)

$ 27.02

(3)

09/28/2011

Common Stock

100,000

100,000

D

Option to Purchase (4)

$ 16.8

01/04/2006

M

37,500

(5)

12/31/2007

Common Stock

150,000

$ 16.8

0

D

Reporting Owners

Reporting Owner Name / Address	Relationships
	Director	10% Owner	Officer	Other
KELBEL CRAIG J 13403 NORTHWEST FREEWAY C/O HCC INSURANCE HOLDINGS HOUSTON, TX 77040			Executive Vice President

Signatures

Christopher L. Martin as Attorney-in-Fact for Craig J. Kelbel		01/06/2006
**Signature of Reporting Person		Date

Explanation of Responses:

*	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).
(1)	Option to purchase granted pursuant to the 2004 Flexible Incentive Plan.
(2)	The options vest equally annually over a 3 year period beginning 12/31/06.
(3)	The options vest equally annually over a five year period beginning 09/28/06.
(4)	Option to purchase granted pursuant to the 2001 Flexible Incentive Plan.
(5)	The options vest equally annually over a 4 year period beginning 01/01/03.

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