QUARTERLY STATEMENT AS OF JUNE 30, 2017 OF THE CONDITION AND AFFAIRS OF THE. Guarantee Insurance Company

Transcription

1 PROPERTY AND CASUALTY COMPANIES - ASSOCIATION EDITION QUARTERLY STATEMENT AS OF JUNE 0, 07 OF THE CONDITION AND AFFAIRS OF THE Guarantee Insurance Company * * NAIC Group Code NAIC Company Code 98 Employer's ID Number -789 (Current) (Prior) Organized under the Laws of Florida, State of Domicile or Port of Entry FL Country of Domicile United States of America Incorporated/Organized 0/5/965 Commenced Business 04/0/965 Statutory Home Office 40 E. Las Olas Blvd., Suite 540, Fort Lauderdale, FL, US 0 (Street and Number) (City or Town, State, Country and Zip Code) Main Administrative Office 40 E. Las Olas Blvd., Suite 540 (Street and Number) Fort Lauderdale, FL, US 0, (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Mail Address 40 E. Las Olas Blvd., Suite 540, Fort Lauderdale, FL, US 0 (Street and Number or P.O. Box) (City or Town, State, Country and Zip Code) Primary Location of Books and Records 40 E. Las Olas Blvd., Suite 540 (Street and Number) Fort Lauderdale, FL, US 0, (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Internet Website Address Statutory Statement Contact Michael John Sluka, (Name) (Area Code) (Telephone Number) msluka@guaranteeins.com, ( Address) (FAX Number) OFFICERS President & Chief Executive Officer Michael John Sluka Treasurer William Douglas Griffin Secretary Eric Stephen Dawson OTHER DIRECTORS OR TRUSTEES Michael John Sluka Joseph Edward Babin Richard Franklin Allen Charles Timothy Morris State of County of Florida Broward SS: The officers of this reporting entity being duly sworn, each depose and say that they are the described officers of said reporting entity, and that on the reporting period stated above, all of the herein described assets were the absolute property of the said reporting entity, free and clear from any liens or claims thereon, except as herein stated, and that this statement, together with related exhibits, schedules and explanations therein contained, annexed or referred to, is a full and true statement of all the assets and liabilities and of the condition and affairs of the said reporting entity as of the reporting period stated above, and of its income and deductions therefrom for the period ended, and have been completed in accordance with the NAIC Annual Statement Instructions and Accounting Practices and Procedures manual except to the extent that: () state law may differ; or, () that state rules or regulations require differences in reporting not related to accounting practices and procedures, according to the best of their information, knowledge and belief, respectively. Furthermore, the scope of this attestation by the described officers also includes the related corresponding electronic filing with the NAIC, when required, that is an exact copy (except for formatting differences due to electronic filing) of the enclosed statement. The electronic filing may be requested by various regulators in lieu of or in addition to the enclosed statement. Michael John Sluka Eric Stephen Dawson William Douglas Griffin President & Chief Executive Officer Secretary Treasurer a. Is this an original filing? Yes [ ] No [ ] Subscribed and sworn to before me this b. If no, day of. State the amendment number. Date filed. Number of pages attached

2 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY ASSETS Assets Current Statement Date 4 December Net Admitted Assets Prior Year Net Nonadmitted Assets (Cols. - ) Admitted Assets. Bonds 86,06,06 86,06,06 79,86,55. Stocks:. Preferred stocks,680,906,680,906,65,6. Common stocks 8,589,485 8,589,485,070,006. Mortgage loans on real estate:. First liens 0 0. Other than first liens Real estate: 4. Properties occupied by the company (less $ encumbrances) Properties held for the production of income (less $ encumbrances),444,64,444,64,46,7 4. Properties held for sale (less $ encumbrances) Cash ($ (46,09) ), cash equivalents ($ ) and short-term investments ($,996,95 ),796,67,796,67 8,09,98 6. Contract loans (including $ premium notes) Derivatives Other invested assets 9,5,847,000,000 6,5,847 6,768, Receivables for securities Securities lending reinvested collateral assets 0 0. Aggregate write-ins for invested assets Subtotals, cash and invested assets (Lines to ) 9,84,758,000,000 06,84,758 09,96,90. Title plants less $ charged off (for Title insurers only) Investment income due and accrued 588, , ,7 5. Premiums and considerations: 5. Uncollected premiums and agents' balances in the course of collection 5,4,44 5,4,44,45,9 5. Deferred premiums, agents' balances and installments booked but deferred and not yet due (including $ 6,965,50 earned but unbilled premiums) 7,097,05 7,097,05,5,76 5. Accrued retrospective premiums ($ ) and 6. Reinsurance: contracts subject to redetermination ($ ) Amounts recoverable from reinsurers 4,66,55 4,66,55 7,560, Funds held by or deposited with reinsured companies 7,79,670 7,79,670 7,785, Other amounts receivable under reinsurance contracts,754,6,754,6 7,4,74 7. Amounts receivable relating to uninsured plans Current federal and foreign income tax recoverable and interest thereon 7,6,0,577,665 6,04,655 6,948,9 8. Net deferred tax asset 8,57,79,864,584 4,9, Guaranty funds receivable or on deposit Electronic data processing equipment and software 0 0. Furniture and equipment, including health care delivery assets ($ ) 0 0. Net adjustment in assets and liabilities due to foreign exchange rates 0 0. Receivables from parent, subsidiaries and affiliates 8,5,86 8,5,86 0 0,586,09 4. Health care ($ ) and other amounts receivable Aggregate write-ins for other than invested assets 6,870,74 5,09,84,560,460 4,06, Total assets excluding Separate Accounts, Segregated Accounts and Protected Cell Accounts (Lines to 5) 48,706,879 5,04,94 66,60,955 99,708,69 7. From Separate Accounts, Segregated Accounts and Protected Cell Accounts Total (Lines 6 and 7) 48,706,879 5,04,94 66,60,955 99,708, DETAILS OF WRITE-INS 98. Summary of remaining write-ins for Line from overflow page Totals (Lines 0 through 0 plus 98)(Line above) Deductible Recoverable - Current 4,78,67,09,84,408,857 7,868, Deductible Recoverable - Deferred 4,9,405 4,9,405 5,8, Reinsurance Trust Receivable,000,000,000, Summary of remaining write-ins for Line 5 from overflow page 4,9,98 0 4,9,98 0,94, Totals (Lines 50 through 50 plus 598)(Line 5 above) 6,870,74 5,09,84,560,460 4,06,750

3 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY LIABILITIES, SURPLUS AND OTHER FUNDS Current Statement Date December, Prior Year. Losses (current accident year $ ) 85,9,09 78,674,88. Reinsurance payable on paid losses and loss adjustment expenses,509,68 87,000. Loss adjustment expenses (9,858,974) (,080,487) 4. Commissions payable, contingent commissions and other similar charges (6,05) (,04) 5. Other expenses (excluding taxes, licenses and fees),,94 98,88 6. Taxes, licenses and fees (excluding federal and foreign income taxes) 6,75,69 7,88,90 7. Current federal and foreign income taxes (including $ on realized capital gains (losses)) 7. Net deferred tax liability 8. Borrowed money $ and interest thereon $ 9. Unearned premiums (after deducting unearned premiums for ceded reinsurance of $ and including warranty reserves of $ and accrued accident and health experience rating refunds including $ 0 for medical loss ratio rebate per the Public Health Service Act) 5,6,080 7,0, Advance premium. Dividends declared and unpaid:. Stockholders. Policyholders. Ceded reinsurance premiums payable (net of ceding commissions) 5,498,9,84,000. Funds held by company under reinsurance treaties,70,05 44,59, Amounts withheld or retained by company for account of others 6,407,905,96, Remittances and items not allocated 6. Provision for reinsurance (including $ certified) 0,7,5 0,7,5 7. Net adjustments in assets and liabilities due to foreign exchange rates 8. Drafts outstanding 9. Payable to parent, subsidiaries and affiliates 0,4,8 0. Derivatives 0 0. Payable for securities,0,604. Payable for securities lending. Liability for amounts held under uninsured plans 4. Capital notes $ and interest thereon $ 5. Aggregate write-ins for liabilities Total liabilities excluding protected cell liabilities (Lines through 5) 4,4,80 70,946, Protected cell liabilities 8. Total liabilities (Lines 6 and 7) 4,4,80 70,946, Aggregate write-ins for special surplus funds Common capital stock,600,0,600,0. Preferred capital stock. Aggregate write-ins for other than special surplus funds 0 0. Surplus notes 50,60,000 8,60, Gross paid in and contributed surplus,84,68,84,68 5. Unassigned funds (surplus) 6. Less treasury stock, at cost: 6. shares common (value included in Line 0 $ ) 6. shares preferred (value included in Line $ ) (4,854,978) (5,8,568) 7. Surplus as regards policyholders (Lines 9 to 5, less 6) 4,89,770 8,76,80 8. Totals (Page, Line 8, Col. ) 66,60,950 99,708,69 DETAILS OF WRITE-INS 50. Unearned Reinsurance Commissions Summary of remaining write-ins for Line 5 from overflow page Totals (Lines 50 through 50 plus 598)(Line 5 above) Summary of remaining write-ins for Line 9 from overflow page Totals (Lines 90 through 90 plus 998)(Line 9 above) Summary of remaining write-ins for Line from overflow page Totals (Lines 0 through 0 plus 98)(Line above) 0 0

4 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY STATEMENT OF INCOME Current Year to Date Prior Year to Date Prior Year Ended December UNDERWRITING INCOME. Premiums earned:. Direct (written $ 45,75,908 ) 5,767,05 5,97,584 59,484,96. Assumed (written $ 5,9,7 ) 4,00,064 7,67,76,58,69. Ceded (written $ 07,545,544 ) 7,4,87 08,80,480 8,050,40.4 Net (written $ 4,47,69 ) 68,67,55 5,64,80 5,97,60 DEDUCTIONS:. Losses incurred (current accident year $ ):. Direct 67,740,66 54,07,65 44,77,76. Assumed 4,8,68,678,48 8,667,68. Ceded,776,6 50,859,74 6,959,85.4 Net 40,775,70 6,890,74 5,885,. Loss adjustment expenses incurred,5,90 9,46,859 7,576,09 4. Other underwriting expenses incurred 7,74,77 8,68,844,50, Aggregate write-ins for underwriting deductions Total underwriting deductions (Lines through 5) 6,85,087 4,946,445 75,97,99 7. Net income of protected cells 8. Net underwriting gain or (loss) (Line minus Line 6 + Line 7) 7,4,465 8,75 (,998,89) INVESTMENT INCOME 9. Net investment income earned 86,96 887,70,44,88 0. Net realized capital gains (losses) less capital gains tax of $ (,5,5) (90,0) (,98,97) (6,64,8). Net investment gain (loss) (Lines 9 + 0) 67,686 (,040,487) (4,79,985) OTHER INCOME. Net gain or (loss) from agents or premium balances charged off (amount recovered $ amount charged off $,097,70 ) (,097,70) (,94,7) (4,70). Finance and service charges not included in premiums 4. Aggregate write-ins for miscellaneous income , Total other income (Lines through 4) (,097,70) (,94,7) (45,08) 6. Net income before dividends to policyholders, after capital gains tax and before all other federal and foreign income taxes (Lines ) 6,96,4 (,96,49) (7,5,906) 7. Dividends to policyholders 6,570 5,008 68,47 8. Net income, after dividends to policyholders, after capital gains tax and before all other federal and foreign income taxes (Line 6 minus Line 7) 6,85,86 (,9,57) (7,59,5) 9. Federal and foreign income taxes incurred 7,08 (404,87) (4,4,855) 0. Net income (Line 8 minus Line 9)(to Line ) 6,40,65 (,57,070) (,70,98) CAPITAL AND SURPLUS ACCOUNT. Surplus as regards policyholders, December prior year 8,76,8 46,88,79 46,88,79. Net income (from Line 0) 6,40,65 (,57,070) (,70,98). Net transfers (to) from Protected Cell accounts 4. Change in net unrealized capital gains (losses) less capital gains tax of $ (7,9,6) 4,60,585 4,597,75 5. Change in net unrealized foreign exchange capital gain (loss) 6. Change in net deferred income tax (,0,870) 89,68,5, Change in nonadmitted assets (6,99,559),680,87 (6,9,56) 8. Change in provision for reinsurance (,78,69) 9. Change in surplus notes,000, Surplus (contributed to) withdrawn from protected cells. Cumulative effect of changes in accounting principles. Capital changes:. Paid in. Transferred from surplus (Stock Dividend). Transferred to surplus. Surplus adjustments:. Paid in 0 0 0,000,000. Transferred to capital (Stock Dividend). Transferred from capital 4. Net remittances from or (to) Home Office 5. Dividends to stockholders 6. Change in treasury stock 0 7. Aggregate write-ins for gains and losses in surplus Change in surplus as regards policyholders (Lines through 7),47,59 6,055,970,967,8 9. Surplus as regards policyholders, as of statement date (Lines plus 8) 4,89,77 5,874,76 50,786,07 DETAILS OF WRITE-INS Summary of remaining write-ins for Line 5 from overflow page Totals (Lines 050 through 050 plus 0598)(Line 5 above) Miscellaneous Income - Net Other 89, Summary of remaining write-ins for Line 4 from overflow page Totals (Lines 40 through 40 plus 498)(Line 4 above) , Summary of remaining write-ins for Line 7 from overflow page Totals (Lines 70 through 70 plus 798)(Line 7 above)

5 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY CASH FLOW Current Year To Date Prior Year To Date Prior Year Ended December Cash from Operations. Premiums collected net of reinsurance,966,496 0,480,98 77,796,40. Net investment income,4,908,87,47,74,747. Miscellaneous income,6,86 (,45,4) 5,76,4 4. Total (Lines to ) 5,45,40 0,4,455 86,99, Benefit and loss related payments 0,,77 7,45,078 69,680,54 6. Net transfers to Separate Accounts, Segregated Accounts and Protected Cell Accounts Commissions, expenses paid and aggregate write-ins for deductions 4,,850 4,59,99 49,50, Dividends paid to policyholders 6,570 5,008 68,47 9. Federal and foreign income taxes paid (recovered) net of $ tax on capital gains (losses) (,,9) 7,79 76,40 0. Total (Lines 5 through 9) 5,094,568 5,87,869 9,75,789. Net cash from operations (Line 4 minus Line 0) (7,64,8) (,95,44) (,46,9) Cash from Investments. Proceeds from investments sold, matured or repaid:. Bonds,568,5 4,04,06,78,6. Stocks 97 4,989,460,99,006. Mortgage loans Real estate Other invested assets 0 98,054,070,940.6 Net gains or (losses) on cash, cash equivalents and short-term investments (90,0) Miscellaneous proceeds,0,604, Total investment proceeds (Lines. to.7),4,84 9,594,76 46,5,7. Cost of investments acquired (long-term only):. Bonds 7,877,54 5,49,0,0,07. Stocks,94,000 5,709,87 5,709,87. Mortgage loans Real estate Other invested assets 0 0,00,000.6 Miscellaneous applications 0,0, Total investments acquired (Lines. to.6) 0,80,54,968,98 9,0, Net increase (or decrease) in contract loans and premium notes Net cash from investments (Line.8 minus Line.7 and Line 4) (8,408,50) 7,65,95 6,940,94 6. Cash provided (applied): Cash from Financing and Miscellaneous Sources 6. Surplus notes, capital notes,000, Capital and paid in surplus, less treasury stock 0 0,000, Borrowed funds Net deposits on deposit-type contracts and other insurance liabilities Dividends to stockholders Other cash provided (applied) 5,04,774,570,797 (8,58,967) 7. Net cash from financing and miscellaneous sources (Line 6. through Line 6.4 minus Line 6.5 plus Line 6.6) 57,04,774,570,797 (8,58,967) RECONCILIATION OF CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS 8. Net change in cash, cash equivalents and short-term investments (Line, plus Lines 5 and 7) 0,984,96 (,99,) (4,844,964) 9. Cash, cash equivalents and short-term investments: 9. Beginning of year 8,09,98,954,88,954,88 9. End of period (Line 8 plus Line 9.) 9,094,84 0,755,560 8,09,98 Note: Supplemental disclosures of cash flow information for non-cash transactions: 5

6 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Accounting Practices The accompanying financial statements of Guarantee Insurance Company (the Company) have been prepared on the basis of accounting practices prescribed or permitted by the Florida Office of Insurance Regulation. The State of Florida requires insurance companies to prepare their statutory financial statements in accordance with National Association of Insurance Commissioners (NAIC) Accounting Practices and Procedures Manual, subject to any deviations prescribed or permitted by the Florida Office of Insurance Regulation. There are differences between some Florida prescribed practices and NAIC accounting practices, but none substantially impact the Company s financial statements. B. Use of Estimates in the Preparation of Financial Statements C. Accounting Policy D. Going Concern No change. ACCOUNTING CHANGES AND CORRECTIONS OF ERRORS. BUSINESS COMBINATIONS AND GOODWILL 4. DISCONTINUED OPERATIONS 5. INVESTMENTS No changes other than items below: D. Loan-Backed Securities (LBS): () Prepayment assumptions and fair values of loan-backed bonds, mortgage-backed/asset-backed securities, and structured securities were obtained from various independent pricing services. Significant changes in prepayment assumptions are accounted for using the retrospective adjustment method. () All securities within the scope of this statement with a recognized other-than-temporary impairment: None. () Securities with a recognized other-than-temporary impairment currently held by the reporting entity: None. (4) At June 0, 07, the Company has no impaired securities (fair value is less than cost or amortized cost) for which an OTTI has not been recognized in earnings as a realized loss. (5) The Company s securities are regularly reviewed for impairment based upon criteria that include the extent to which cost exceeds fair value, the duration of the market decline, the financial health of and specific prospects for the issuer and the ability and intent to hold the investment to recovery. F. Restricted Assets: The Company has no restricted assets other than those on deposit with various states and those deposited in reinsurance trusts. Restricted Asset Category Total General Account Total from Prior Year Increase/ (Decrease) Total Current Year Admitted Restricted Gross Restricted to total Assets Admitted Restricted to Total Admitted Assets On deposit with States 8,590,000,79,000 4,799,000 8,590, % 5.% Pledged as Collateral under reinsurance agreement 65,00,000 6,6,000,8,000 65,00, % 7.7% Total restricted assets 8,59, ,4, ,80, ,59, %.8% 6

7 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY 6. JOINT VENTURES, PARTNERSHIPS AND LIMITED LIABILITY COMPANIES 7. INVESTMENT INCOME 8. DERIVATIVE INSTRUMENTS 9. INCOME TAXES No significant change from the disclosure included in the Company s annual statement for the year ended December, INFORMATION CONCERNING PARENT, SUBSIDIARIES,AFFILIATES AND OTHER RELATED PARTIES No changes other than items below: A, B, & C. Patriot National, Inc., an affiliate of Ashmere Insurance Company through common ownership of the ultimate controlling person, Steven Mariano, made changes to its organizational chart, effective as of January, 07. The corporate changes are listed below, and the entities will keep the same tax ID numbers. Each of the following was converted from a Delaware corporation to a Delaware LLC: Patriot Services, Inc. to Patriot Services, LLC Patriot Risk Consultants, Inc. to Patriot Risk Consultants, LLC Patriot Audit Services, Inc. to Patriot Audit Services, LLC Forza Lien, Inc. to Forza Lien, LLC Patriot Captive Management, Inc. to Patriot Captive Management, LLC Patriot Technology Solutions, Inc. to Patriot Technology Solutions, LLC Patriot Care Management, Inc. to Patriot Captive Management, LLC Additionally, the following mergers took place which effectively removed these entities from the Patriot National organization chart: CompLinx Insurance Agency, Inc. was dissolved by merger into Patriot Underwriters. Patriot Care, Inc. was dissolved by merger into Patriot Care Management, Inc. InsureLinx, Inc. was dissolved by merger into Patriot Technology Solutions, Inc. Vikaran Technology Solutions, Inc. was dissolved by merger into Patriot Technology Solutions, Inc. D. At June 0, 07, the Company s net balance payable to affiliates was forgiven by affiliates in the form of a subordinated surplus debenture (see Note ). E. Not Applicable F. Not Applicable G. Not Applicable H. Not Applicable I. Not Applicable J. Not Applicable K. Not Applicable L. Not Applicable M. The Company owns,86,55 shares of Patriot National, Inc., an entity in which the Company s ultimate controlling person has a controlling interest. The Company s investment, representing approximately 0.56% of the total outstanding shares of Patriot National, was valued at $6,0,454 based on the June 0, 07 closing price on the New York Stock Exchange. The investment meets the market valuation criteria in paragraph 8 of SSAP #97. The Company submitted the investment to the NAIC Investment Analysis Office in November 05 and filed an update on form SUB with the Investment Analysis Office in June 06.. DEBT 6.

8 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY. RETIREMENT PLANS, DEFERRED COMPENSATION, POSTEMPLOYMENT BENEFITS AND COMPENSATED ABSENCES AND OTHER POSTRETIREMENT BENEFIT PLANS. CAPITAL AND SURPLUS, DIVIDEND RESTRICTIONS AND QUASI-REORGANIZATIONS The Company issued subordinated surplus debentures in the amount of $ million to an affiliated entity, Patriot Underwriters, Inc dated August 6, 07, but treated as Surplus pursuant to a SSAP7 contribution making such contribution effective June 0, 07. Also see Note. 4. LIABILITIES, CONTINGENCIES AND ASSESSMENTS 5. LEASES 6. INFORMATION ABOUT FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND FINANCIAL INSTRUMENTS WITH CONCENTRATIONS OF CREDIT RISK 7. SALE, TRANSFER AND SERVICING OF FINANCIAL ASSETS AND EXTINGUISHMENT OF LIABILITIES In connection with the issuance of subordinated surplus debentures discussed in Notes and, the the company recorded a reduction in amounts payable to affiliates in the amount of $ million. This transaction extinguished liabilities as the form of funding of the surplus debentures. 8. GAIN OR LOSS TO THE REPORTING ENTITY FROM UNINSURED PLANS AND THE UNINSURED PORTION OF PARTIALLY INSURED PLANS 9. DIRECT PREMIUM WRITTEN/PRODUCED BY MANAGING GENERAL AGENTS/THIRD PARTY ADMINISTRATORS 0. FAIR VALUE MEASUREMENT A.) Assets Measured at Fair Value: () Fair Value Measurements at Reporting Date Description for each class of asset or liability Level Level Level Total a. Assets at Fair Value Preferred Stock Industrial & misc - unaffiliated - 477,5-477,5 Total preferred stock - 477,5-477,5 Common Stock Industrial & misc - unaffiliated,576,0 - -,576,0 Parent, Subs, & Affiliates 6,0, ,0,454 Total common stock 8,589, ,589,485 TOTAL ASSETS AT FAIR VALUE 8,589, ,5-9,066,88 b. Liabilities at Fair Value NONE TOTAL LIABILITIES AT FAIR VALUE (.) The Company had no investments valued in Level of the Fair Value Hierarchy during the three months ended June 0, B.) Not applicable 6.

9 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY. OTHER ITEMS. EVENTS SUBSEQUENT See Note D The Company recorded a contribution to Surplus in the amount of $ million under the provisions of SSAP7. Under this SSAP, subordinated surplus debentures issued on August 6, 07 in the amount of $ million were recorded in surplus as of June 0, 07.. REINSURANCE The Company renewed its Excess of Loss Reinsurance as of June, 07 on substantially similar terms to the prior year. 4. RETROSPECTIVELY RATED CONTRACTS & CONTRACTS SUBJECT TO REDETERMINATION 5. CHANGES IN INCURRED LOSSES AND LOSS ADJUSTMENT EXPENSES During the three months ended June 0, 07, the Company experienced unfavorable net loss and loss adjustment expense reserve development relating to prior accident years of approximately $.4 million. This unfavorable development results primarily from a commutation with one of the Company s segregated cell reinsurers and NCCI / Legacy items. 6. INTERCOMPANY POOLING ARRANGEMENTS 7. STRUCTURED SETTLEMENTS 8. HEALTH CARE RECEIVABLES 9. PARTICIPATING POLICIES 0. PREMIUM DEFICIENCY RESERVES. HIGH DEDUCTIBLES. DISCOUNTING OF LIABILITIES FOR UNPAID LOSSES OR UNPAID LOSS ADJUSTMENT EXPENSES. ASBESTOS/ENVIRONMENTAL RESERVES 4. SUBSCRIBER SAVINGS ACCOUNTS 5. MULTIPLE PERIL CROP INSURANCE 6. FINANCIAL GUARANTY INSURANCE 6.

10 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY GENERAL INTERROGATORIES PART - COMMON INTERROGATORIES GENERAL. Did the reporting entity experience any material transactions requiring the filing of Disclosure of Material Transactions with the State of Domicile, as required by the Model Act? Yes [ X ] No [ ]. If yes, has the report been filed with the domiciliary state? Yes [ X ] No [ ]. Has any change been made during the year of this statement in the charter, by-laws, articles of incorporation, or deed of settlement of the reporting entity? Yes [ ] No [ X ]. If yes, date of change:. Is the reporting entity a member of an Insurance Holding Company System consisting of two or more affiliated persons, one or more of which is an insurer? Yes [ X ] No [ ] If yes, complete Schedule Y, Parts and A.. Have there been any substantial changes in the organizational chart since the prior quarter end? Yes [ ] No [ X ]. If the response to. is yes, provide a brief description of those changes. 4. Has the reporting entity been a party to a merger or consolidation during the period covered by this statement? Yes [ ] No [ X ] 4. If yes, provide the name of the entity, NAIC Company Code, and state of domicile (use two letter state abbreviation) for any entity that has ceased to exist as a result of the merger or consolidation. Name of Entity NAIC Company Code State of Domicile 5. If the reporting entity is subject to a management agreement, including third-party administrator(s), managing general agent(s), attorneyin-fact, or similar agreement, have there been any significant changes regarding the terms of the agreement or principals involved? Yes [ ] No [ X ] N/A [ ] If yes, attach an explanation. 6. State as of what date the latest financial examination of the reporting entity was made or is being made. //05 6. State the as of date that the latest financial examination report became available from either the state of domicile or the reporting entity. This date should be the date of the examined balance sheet and not the date the report was completed or released. //0 6. State as of what date the latest financial examination report became available to other states or the public from either the state of domicile or the reporting entity. This is the release date or completion date of the examination report and not the date of the examination (balance sheet date). 06/0/ By what department or departments? Florida Office of Insurance Regulation 6.5 Have all financial statement adjustments within the latest financial examination report been accounted for in a subsequent financial statement filed with Departments? Yes [ X ] No [ ] N/A [ ] 6.6 Have all of the recommendations within the latest financial examination report been complied with? Yes [ X ] No [ ] N/A [ ] 7. Has this reporting entity had any Certificates of Authority, licenses or registrations (including corporate registration, if applicable) suspended or revoked by any governmental entity during the reporting period? Yes [ ] No [ X ] 7. If yes, give full information: 8. Is the company a subsidiary of a bank holding company regulated by the Federal Reserve Board? Yes [ ] No [ X ] 8. If response to 8. is yes, please identify the name of the bank holding company. 8. Is the company affiliated with one or more banks, thrifts or securities firms? Yes [ ] No [ X ] 8.4 If response to 8. is yes, please provide below the names and location (city and state of the main office) of any affiliates regulated by a federal regulatory services agency [i.e. the Federal Reserve Board (FRB), the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC) and the Securities Exchange Commission (SEC)] and identify the affiliate's primary federal regulator. Affiliate Name Location (City, State) FRB 4 OCC 5 FDIC 6 SEC 7

11 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY GENERAL INTERROGATORIES 9. Are the senior officers (principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions) of the reporting entity subject to a code of ethics, which includes the following standards? Yes [ X ] No [ ] (a) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (b) Full, fair, accurate, timely and understandable disclosure in the periodic reports required to be filed by the reporting entity; (c) Compliance with applicable governmental laws, rules and regulations; (d) The prompt internal reporting of violations to an appropriate person or persons identified in the code; and (e) Accountability for adherence to the code. 9. If the response to 9. is No, please explain: 9. Has the code of ethics for senior managers been amended? Yes [ ] No [ X ] 9. If the response to 9. is Yes, provide information related to amendment(s). 9. Have any provisions of the code of ethics been waived for any of the specified officers? Yes [ ] No [ X ] 9. If the response to 9. is Yes, provide the nature of any waiver(s). FINANCIAL 0. Does the reporting entity report any amounts due from parent, subsidiaries or affiliates on Page of this statement? Yes [ ] No [ X ] 0. If yes, indicate any amounts receivable from parent included in the Page amount: $ INVESTMENT. Were any of the stocks, bonds, or other assets of the reporting entity loaned, placed under option agreement, or otherwise made available for use by another person? (Exclude securities under securities lending agreements.) Yes [ ] No [ X ]. If yes, give full and complete information relating thereto:. Amount of real estate and mortgages held in other invested assets in Schedule BA: $. Amount of real estate and mortgages held in short-term investments: $ 450, Does the reporting entity have any investments in parent, subsidiaries and affiliates? Yes [ X ] No [ ] 4. If yes, please complete the following: Prior Year-End Book/Adjusted Carrying Value Current Quarter Book/Adjusted Carrying Value 4. Bonds $ 0 $ 4. Preferred Stock $ 0 $ 4. Common Stock $ 9,004,888 $ 6,0, Short-Term Investments $ 0 $ 4.5 Mortgage Loans on Real Estate $ 0 $ 4.6 All Other $ 0 $ 4.7 Total Investment in Parent, Subsidiaries and Affiliates (Subtotal Lines 4. to 4.6) $ 9,004,888 $ 6,0, Total Investment in Parent included in Lines 4. to 4.6 above $ $ 5. Has the reporting entity entered into any hedging transactions reported on Schedule DB? Yes [ ] No [ X ] 5. If yes, has a comprehensive description of the hedging program been made available to the domiciliary state? Yes [ ] No [ ] If no, attach a description with this statement. 7.

12 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY GENERAL INTERROGATORIES 6. For the reporting entity s security lending program, state the amount of the following as of the current statement date: 6. Total fair value of reinvested collateral assets reported on Schedule DL, Parts and. $ 0 6. Total book adjusted/carrying value of reinvested collateral assets reported on Schedule DL, Parts and $ 0 6. Total payable for securities lending reported on the liability page. $ 0 7. Excluding items in Schedule E - Part - Special Deposits, real estate, mortgage loans and investments held physically in the reporting entity s offices, vaults or safety deposit boxes, were all stocks, bonds and other securities, owned throughout the current year held pursuant to a custodial agreement with a qualified bank or trust company in accordance with Section, III - General Examination Considerations, F. Outsourcing of Critical Functions, Custodial or Safekeeping Agreements of the NAIC Financial Condition Examiners Handbook? Yes [ ] No [ X ] 7. For all agreements that comply with the requirements of the NAIC Financial Condition Examiners Handbook, complete the following: Name of Custodian(s) Custodian Address 7. For all agreements that do not comply with the requirements of the NAIC Financial Condition Examiners Handbook, provide the name, location and a complete explanation: Name(s) Location(s) Complete Explanation(s) 7. Have there been any changes, including name changes, in the custodian(s) identified in 7. during the current quarter? Yes [ ] No [ X ] 7.4 If yes, give full information relating thereto: Old Custodian New Custodian Date of Change 4 Reason 7.5 Investment management Identify all investment advisors, investment managers, broker/dealers, including individuals that have the authority to make investment decisions on behalf of the reporting entity. For assets that are managed internally by employees of the reporting entity, note as such. [" that have access to the investment accounts"; " handle securities"] Name of Firm or Individual Affiliation For those firms/individuals listed in the table for Question 7.5, do any firms/individuals unaffiliated with the reporting entity (i.e. designated with a "U") manage more than 0% of the reporting entity s assets? Yes [ ] No [ X ] For firms/individuals unaffiliated with the reporting entity (i.e. designated with a "U") listed in the table for Question 7.5, does the total assets under management aggregate to more than 50% of the reporting entity s assets? Yes [ ] No [ X ] 7.6 For those firms or individuals listed in the table for 7.5 with an affiliation code of "A" (affiliated) or "U" (unaffiliated), provide the information for the table below. Central Registration Depository Number Name of Firm or Individual Legal Entity Identifier (LEI) 4 Registered With 5 Investment Management Agreement (IMA) Filed 8. Have all the filing requirements of the Purposes and Procedures Manual of the NAIC Investment Analysis Office been followed? Yes [ X ] No [ ] 8. If no, list exceptions: 7.

13 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY GENERAL INTERROGATORIES PART - PROPERTY & CASUALTY INTERROGATORIES. If the reporting entity is a member of a pooling arrangement, did the agreement or the reporting entity s participation change? Yes [ ] No [ ] N/A [ X ] If yes, attach an explanation.. Has the reporting entity reinsured any risk with any other reporting entity and agreed to release such entity from liability, in whole or in part, from any loss that may occur on the risk, or portion thereof, reinsured? Yes [ ] No [ X ] If yes, attach an explanation.. Have any of the reporting entity s primary reinsurance contracts been canceled? Yes [ ] No [ X ]. If yes, give full and complete information thereto. 4. Are any of the liabilities for unpaid losses and loss adjustment expenses other than certain workers compensation tabular reserves (see Annual Statement Instructions pertaining to disclosure of discounting for definition of tabular reserves ) discounted at a rate of interest greater than zero? Yes [ ] No [ X ] 4. If yes, complete the following schedule: Line of Business Maximum Interest TOTAL DISCOUNT DISCOUNT TAKEN DURING PERIOD Discount Unpaid Unpaid Unpaid Unpaid Rate Losses LAE IBNR TOTAL Losses LAE IBNR TOTAL TOTAL Operating Percentages: 5. A&H loss percent 5. A&H cost containment percent 5. A&H expense percent excluding cost containment expenses % % % 6. Do you act as a custodian for health savings accounts? Yes [ ] No [ X ] 6. If yes, please provide the amount of custodial funds held as of the reporting date $ 6. Do you act as an administrator for health savings accounts? Yes [ ] No [ X ] 6.4 If yes, please provide the balance of the funds administered as of the reporting date $ 8

14 NAIC Company Code ID Number Name of Reinsurer STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY SCHEDULE F - CEDED REINSURANCE Showing All New Reinsurers - Current Year to Date 4 Domiciliary Jurisdiction 5 Type of Reinsurer 6 Certified Reinsurer Rating ( through 6) 7 Effective Date of Certified Reinsurer Rating 9 NONE

15 States, etc. STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY SCHEDULE T - EXHIBIT OF PREMIUMS WRITTEN Current Year to Date - Allocated by States and Territories Direct Premiums Written Direct Losses Paid (Deducting Salvage) Direct Losses Unpaid Current Year Prior Year Current Year Prior Year Current Year To Date To Date To Date To Date To Date Active Status 7 Prior Year To Date. Alabama AL L,089,9,8,87 44,95,0,00,8,687,695. Alaska AK N. Arizona AZ N 4. Arkansas AR L,6,699,6,66 80,9 865,6,89,754,48, California CA L 6. Colorado CO L,58,857 9,987 5,0 44,46 948,9,79,0 7. Connecticut CT N 8. Delaware DE L,77,07 (76,750) 708,6 404,,806,54,685,9 9. District of Columbia DC L,008,6 797,54 8,60 60,49 9,48 57,0 0. Florida FL L 4,0,68,64,89 8,996,0 7,879,58 66,098,608 6,470,54. Georgia GA L 0,64,5 9,97,5 4,696,654 4,808,7 7,889,796 6,459,77. Hawaii HI L. Idaho ID L 95,96 0,85 4,70 89,54 47,4 75,68 4. Illinois IL N 4 5. Indiana IN L 4,5,5 4,678,889,40,45,0,6 4,96,56 7,44, Iowa IA N 7. Kansas KS N 8. Kentucky KY L,4,40,99,05,, ,6,46,85,5, Louisiana LA L 679,054,044, ,46 764,584,57,9,70, Maine ME L 5,7 8,75 76,978 6,086 8,40 4,0. Maryland MD L,,75,756, ,508 5,49,4,808,869,087. Massachusetts MA L. Michigan MI L,879,440,95,74,99,90 88,98,959,5,465,97 4. Minnesota MN L 5. Mississippi MS L,576,9,98,67,40,89,0,7,905,908,90,08 6. Missouri MO L,0,09,59,4,99,00,5,559 7,770,647 0,87,65 7. Montana MT L 6,004 68,77 77,94 7,4 6,40 7, Nebraska NE L,8,64,049, ,448,40,450,78,68,464, Nevada NV L 79,95 885,566 0,6 486,94 968,67,05,5 0. New Hampshire NH L. New Jersey NJ L,99,48 5,46,088 9,6,90 7,878,769 6,8,096 5,9,55. New Mexico NM L,04,94 879,460,705 86,999 79,56 406,59. New York NY L 6,765,97 6,090,406 9,640,445 8,748,80 9,8,8 9,74,4 4. North Carolina NC L 5,860,79 5,46,59,,07,4,748 6,508,450 5,685,06 5. North Dakota ND L 6. Ohio OH N 7. Oklahoma OK L,97,974 5,08,559,45,889,60,49 7,09,557 6,97, Oregon OR L 554,048 89,79 0,076 00,977 44,09 47, Pennsylvania PA L 7,69,9 6,80,9 6,0,0 6,04,85,45,05,840, Rhode Island RI N 4. South Carolina SC L 4,5,84 5,44,065,95,56,80,484 7,0,85 8,69, South Dakota SD L 64,745 00,89 5,669 5,570,044 8,97 4. Tennessee TN L,605,76,876,56 905,4,806,95,88,89 4,6, Texas TX L 74,4 84,079 8,744 0,056,09, , Utah UT N 46. Vermont VT L 47. Virginia VA L 4,4,58 4,40,970,479,590,64,986,57,7 7,675, Washington WA L 49. West Virginia WV L 55,504 58,06 09, 665,09,69,57,747, Wisconsin WI L 60 4,806 7,549 65,59 5. Wyoming WY N 5. American Samoa AS N 5. Guam GU N 54. Puerto Rico PR N 55. U.S. Virgin Islands VI N 56. Northern Mariana Islands MP N 57. Canada CAN N 58. Aggregate Other Alien OT XXX Totals (a) 4 45,75,906 0,,60 76,079,476 7,657,75 65,8,0 60,464,6 DETAILS OF WRITE-INS XXX XXX XXX Summary of remaining write-ins for Line 58 from overflow page XXX Totals (Lines 5800 through 5800 plus 58998)(Line 58 above) XXX (L) Licensed or Chartered - Licensed Insurance Carrier or Domiciled RRG; (R) Registered - Non-domiciled RRGs; (Q) Qualified - Qualified or Accredited Reinsurer; (E) Eligible - Reporting Entities eligible or approved to write Surplus Lines in the state (other than their state of domicile - see DSLI); (D) DSLI - Domestic Surplus Lines Insurer (DSLI) - Reporting entities authorized to write Surplus Lines in the state of domicile; (N) None of the above - Not allowed to write business in the state. (a) Insert the number of D and L responses except for Canada and Other Alien. 0

16 STATEMENT AS OF JUNE 0, 07 OF THE ASHMERE INSURANCE COMPANY SCHEDULE Y PART ORGANIZATIONAL CHART Patriot National, Inc. FEIN Delaware NYSE PN (Mr. Mariano majority shareholder) Steven M. Mariano Steven M. Mariano Patriot Services, LLC FEIN Delaware Steven Mariano Trust [Florida] 96.% Direct Beneficial Ownership Other Investors.8% Deerfield Insurance Holdings, Inc. FEIN DE SMM 49.8% Ownership Other Investors 50.% Contego Investigative Services, Inc. FEIN DE Contego Services Group, LLC FEIN DE PSI 97% & SMM % Patriot Captive Mgmt.,LLC FEIN DE Patriot Captive Management (Cayman Islands), Ltd. Patriot Captive Management (Bahamas), Ltd. Patriot Underwriters, Inc. FEIN DE Patriot Audit Services, LLC FEIN DE Patriot Risk Consultants, LLC FEIN DE Trigen Hospitality Group, Inc. FEIN DE Trigen Insurance Solutions, Inc. FEIN DE Patriot Care Management, LLC. FEIN DE Decision UR, LLC 98.8% PTS.% Other FEIN Patriot Risk Services, Inc. FEIN Corporate Claims Management, Inc. FEIN CWIBenefits, Inc. FEIN DE Patriot Claim Services, Inc. FEIN DE Radar Post-Closing Holding Company, Inc. FEIN DE Patriot Technology Solutions, LLC FEIN DE PN India Holdings Mauritius Mehta & Pazol Consulting Svcs PVT, LTD India PNIH 99.98%, PTS 0.0% Guarantee Insurance Group, Inc. FEIN Delaware Guarantee Insurance Company FEIN -789 NAIC CODE / GRP 98 / 49 Florida Guarantee Underwriters, Inc. FEIN Delaware Six Points Ventures III, LLC FEIN Delaware National Fidelity Holdings, Inc. FEIN Delaware National Fidelity Ins. Agency, Inc. FEIN Delaware Ashmere Insurance Company FEIN NAIC CODE / GRP 4098 / 49 Florida Forza Lien, LLC FEIN DE Old Guard Re, SPC Cayman Islands * Unless otherwise noted, each entity is a Delaware corporation or Delaware limited liability company and is 00% controlled by its immediate parent.

17 NAIC Company Code 4 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY SCHEDULE Y PART A - DETAIL OF INSURANCE HOLDING COMPANY SYSTEM Name of Securities Exchange if Publicly Traded (U.S. or International) 8 Names of Parent, Subsidiaries Or Affiliates 9 0 Domiciliary Location Relationship to Reporting Entity Type of Control (Ownership, Board, Management, Attorney-in-Fact, Influence, Other) Group Code Group Name ID Number Federal RSSD CIK Directly Controlled by (Name of Entity/Person) Ultimate Controlling Entity(ies)/Person(s) DEERFIELD INSURANCE HOLDINGS, INC. DE UIP STEVEN M. MARIANO Ownership STEVEN M. MARIANO 49 SM Mariano Grp ASHMERE INSURANCE COMPANY FL NATIONAL FIDELITY HOLDINGS, INC. Ownership STEVEN M. MARIANO NATIONAL FIDELITY HOLDINGS, INC. DE UDP DEERFIELD INSURANCE HOLDINGS, INC. Ownership STEVEN M. MARIANO NATIONAL FIDELITY INSURANCE AGENCY, INC. DE NIA NATIONAL FIDELITY HOLDINGS, INC. Ownership STEVEN M. MARIANO GUARANTEE INSURANCE GROUP, INC. DE UDP STEVEN MARIANO TRUST Ownership STEVEN M. MARIANO 49 SM Mariano Grp GUARANTEE INSURAMCE COMPANY FL IA GUARANTEE INSURANCE GROUP, INC. Ownership STEVEN M. MARIANO PATRIOT CLAIM SERVICES, INC. DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO PATRIOT CAPTIVE MANAGEMENT, LLC DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO If Control is Ownership Provide Percentage PATRIOT CAPTIVE MANAGEMENT (CAYMAN ISLANDS), LTD CYM NIA PATRIOT CAPTIVE MANAGEMENT, LLC Ownership STEVEN M. MARIANO PATRIOT CAPTIVE MANAGEMENT (BAHAMAS), LTD BHS NIA PATRIOT CAPTIVE MANAGEMENT, LLC Ownership STEVEN M. MARIANO GUARANTEE UNDERWRITERS, INC. DE NIA GUARANTEE INSURANCE GROUP, INC. Ownership STEVEN M. MARIANO NEW YORK STOCK EXCHANGE PATRIOT NATIONAL, INC. DE NIA STEVEN M. MARIANO Ownership STEVEN M. MARIANO PATRIOT RISK SERVICES, INC. DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO CONTEGO SERVICES GROUP, LLC DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO CONTEGO INVESTIGATIVE SERVICES, INC DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO FORZA LEIN, LLC DE NIA PATRIOT RISK SERVICES, INC. Ownership STEVEN M. MARIANO OLD GUARD RE., SPC CYM NIA SIX POINTS VENTURES III, LLC Ownership STEVEN M. MARIANO PATRIOT TECHNOLOGY SOLUTIONS, LLC DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO PATRIOT UNDERWRITERS, INC. DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO SIX POINTS VENTURES III, LLC DE NIA GUARANTEE INSURANCE GROUP, INC. Ownership STEVEN M. MARIANO PATRIOT CARE MANAGEMENT, LLC DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO CORPORATE CLAIMS MANAGEMENT, INC. DE NIA PATRIOT RISK SERVICES, INC. Ownership STEVEN M. MARIANO TRIGEN INSURANCE SOLUTIONS, INC. DE NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO TRIGEN HOSPITALITY GROUP, INC. DE NIA PATRIOT UNDERWRITERS, INC. Ownership STEVEN M. MARIANO PN INDIA HOLDINGS MUS NIA PATRIOT SERVICES, LLC Ownership STEVEN M. MARIANO MEHTA & PAZOL CONSULTING SERVICES PVT, LTD. IND NIA PN INDIA HOLDINGS Ownership STEVEN M. MARIANO PATRIOT RISK CONSULTANTS, LLC DE NIA PATRIOT UNDERWRITERS, INC. Ownership STEVEN M. MARIANO CWIBENEFITS, INC. DE NIA PATRIOT RISK SERVICES, INC. Ownership STEVEN M. MARIANO PATRIOT AUDIT SERVICES, LLC DE NIA PATRIOT UNDERWRITERS, INC. Ownership STEVEN M. MARIANO PATRIOT SERVICES, LLC DE NIA PATRIOT NATIONAL, INC. Ownership STEVEN M. MARIANO DECISION UR, LLC CA NIA PATRIOT TECHNOLOGY SOLUTIONS, INC. Ownership STEVEN M. MARIANO 4 5 Is an SCA Filing Required? (Y/N) 6 * Asterisk Explanation

18 STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY PART - LOSS EXPERIENCE Direct Premiums Earned Current Year to Date 4 Direct Losses Direct Loss Incurred Percentage Prior Year to Date Direct Loss Percentage Line of Business. Fire Allied Lines Farmowners multiple peril Homeowners multiple peril Commercial multiple peril Mortgage guaranty Ocean marine Inland marine Financial guaranty Medical professional liability - occurrence Medical professional liability - claims-made Earthquake Group accident and health Credit accident and health Other accident and health Workers compensation 5,767,05 67,740, Other liability - occurrence Other liability - claims-made Excess workers compensation Products liability - occurrence Products liability - claims-made ,9. Private passenger auto liability ,9.4 Commercial auto liability Auto physical damage Aircraft (all perils) Fidelity Surety Burglary and theft Boiler and machinery Credit International Warranty Reinsurance - Nonproportional Assumed Property XXX XXX XXX XXX. Reinsurance - Nonproportional Assumed Liability XXX XXX XXX XXX. Reinsurance - Nonproportional Assumed Financial Lines XXX XXX XXX XXX 4. Aggregate write-ins for other lines of business Totals 5,767,05 67,740, DETAILS OF WRITE-INS Summary of remaining write-ins for Line 4 from overflow page Totals (Lines 40 through 40 plus 498)(Line 4 above) PART - DIRECT PREMIUMS WRITTEN Current Year to Date Prior Year Year to Date Line of Business Current Quarter. Fire 0. Allied Lines 0. Farmowners multiple peril 0 4. Homeowners multiple peril 0 5. Commercial multiple peril 0 6. Mortgage guaranty 0 8. Ocean marine 0 9. Inland marine 0 0. Financial guaranty 0. Medical professional liability - occurrence 0. Medical professional liability - claims-made 0. Earthquake 0. Group accident and health 0 4. Credit accident and health 0 5. Other accident and health 0 6. Workers compensation 65,84,5 45,75,908 0,,60 7. Other liability - occurrence 0 7. Other liability - claims-made 0 7. Excess workers compensation 0 8. Products liability - occurrence 0 8. Products liability - claims-made 0 9.,9. Private passenger auto liability 0 9.,9.4 Commercial auto liability 0. Auto physical damage 0. Aircraft (all perils) 0. Fidelity 0 4. Surety 0 6. Burglary and theft 0 7. Boiler and machinery 0 8. Credit 0 9. International 0 0. Warranty 0. Reinsurance - Nonproportional Assumed Property XXX XXX XXX. Reinsurance - Nonproportional Assumed Liability XXX XXX XXX. Reinsurance - Nonproportional Assumed Financial Lines XXX XXX XXX 4. Aggregate write-ins for other lines of business Totals 65,84,5 45,75,908 0,,60 DETAILS OF WRITE-INS Summary of remaining write-ins for Line 4 from overflow page Totals (Lines 40 through 40 plus 498)(Line 4 above) 0 0 0

19 4 Years in Which Losses Occurred Prior Year-End Known Case Loss and LAE Reserves Prior Year- End IBNR Loss and LAE Reserves STATEMENT AS OF JUNE 0, 07 OF THE GUARANTEE INSURANCE COMPANY PART (000 omitted) Total Prior Year-End Loss and LAE Reserves (Cols. +) LOSS AND LOSS ADJUSTMENT EXPENSE RESERVES SCHEDULE Loss and LAE Payments on Claims Reported as of Prior Year-End 07 Loss and LAE Payments on Claims Unreported as of Prior Year-End Total 07 Loss and LAE Payments (Cols. 4+5) Q.S. Date Known Case Loss and LAE Reserves on Claims Reported and Open as of Prior Year End Q.S. Date Known Case Loss and LAE Reserves on Claims Reported or Reopened Subsequent to Prior Year End 9 Q.S. Date IBNR Loss and LAE Reserves 0 Total Q.S. Loss and LAE Reserves (Cols.7+8+9) Prior Year-End Known Case Loss and LAE Reserves Developed (Savings)/ Deficiency (Cols.4+7 minus Col. ) Prior Year-End IBNR Loss and LAE Reserves Developed (Savings)/ Deficiency (Cols minus Col. ) Prior Year-End Total Loss and LAE Reserve Developed (Savings)/ Deficiency (Cols. +) Prior 59,877 (4,49) 6,48,7,7 58,79 (8,87) 49,857 0,564 4,567 45,. 05 4,805 (0,59) (5,786),76,76 7,808 (5,97),5 (,8) 5,94,0. Subtotals 05 + Prior 74,68 (74,00) 65 5,48 0 5,48 66,57 0 (4,69) 5,68 7,8 59,86 67, ,767 54,557 65,4 4,86 4,86 4,668 (7,874) (,06) (,8) (6,4) (6,74) 5. Subtotals 06 + Prior 85,449 (9,47) 65,976 0,44 0 0,44 7,05 0 (,04) 49,6 6,000 (,570), XXX XXX XXX XXX,5,5 XXX 9, 4,85 4,065 XXX XXX XXX 7. Totals 85,449 (9,47) 65,976 0,44,5,776 7,05 9, (7,9) 7,7 6,000 (,570),40 8. Prior Year-End Surplus As Regards Policyholders 8,76 Col., Line 7 As % of Col. Line 7 Col., Line 7 As % of Col. Line Col., Line 7 As % of Col. Line 7 Col., Line 7 As a % of Col. Line