French city accepts English relative (5)
I believe the answer is:
niece
'relative' is the definition.
(type of relative)
'french city accepts english' is the wordplay.
'french city' becomes 'nice' (Nice is a French city).
'accepts' is an insertion indicator.
'english' becomes 'E' (abbreviation).
'nice' going around 'e' is 'NIECE'.
(Other definitions for niece that I've seen before include "Preparation for curdling milk" , "Young female relative" , "Son's cousin" , "Brother's daughter" , "Criminal" .)