Companion cared terribly, hugging old maiden (7)
I believe the answer is:
comrade
'companion' is the definition.
('comrade' can be a synonym of 'companion')
'cared terribly hugging old maiden' is the wordplay.
'terribly' indicates anagramming the letters.
'hugging' indicates putting letters inside.
'old' becomes 'o' (common abbreviation eg in OE for Old English).
'maiden' becomes 'm' (cricket abbreviation).
'cared' is an anagram of 'crade'.
'o'+'m'='om'
'crade' placed around 'om' is 'COMRADE'.
(Other definitions for comrade that I've seen before include "Fellow left-winger" , "Companion" , "Fellow socialist or good friend" , "Pal" , "Fellow-soldier" .)