Profitability (C) Working Group
September 13, 2007

The Profitability (C) Working Group met via a Regulator to Regulator conference call September 13, 2007.

The Working Group reviewed the current methodology of the report and the feasibility of potential changes to that methodology. Additionally, the Working Group reviewed the first draft of the Report on Profitability by Line by State 2006. Issues requiring further investigation include:

1. The “Earned Premium to Net Worth” calculation in the homeowner’s line,
2. The “Investment Gain on Insurance Transactions” ratio in the medical malpractice line, and
3. The “Return on Net Worth” ratio in the workers’ compensation and allied lines.

During the upcoming quarter, the Profitability (C) Working Group plans to meet via conference call to discuss the findings on the above issues, review the Report on Profitability by Line by State 2006, and continue discussions on report methodology.

There were no action items of the Working Group.