NEWS RELEASE

2108 East South Boulevard Montgomery, Alabama 36116 Telephone 334-288-3900

FINANCIAL CONTACT:		MEDIA CONTACT:
Stephen G. Rutledge		David Rickey
Senior Vice President, CFO		Vice President – Public Relations
and Chief Investment Officer		(334)613-4034
(334)613-4500

ALFA CORPORATION REPORTS FIRST QUARTER 2007 RESULTS

Montgomery, Alabama (May 2, 2007) — Alfa Corporation (NASDAQ:ALFA) today announced financial results for the three months ended March 31, 2007. Operating income for the quarter was $13,514,159, or $0.17 per diluted share, compared with operating income of $20,055,079, or $0.25 per diluted share, for the first quarter of 2006, a decrease of 33.0% on a per share basis. Net income, which includes net realized investment gains, was $14,328,820, or $0.18 per diluted share for the first quarter of 2007, compared with $20,137,442, or $0.25 per diluted share in 2006, a per share decrease of 29.2%. Premiums and policy charges for the first quarter of 2007 increased 5.3% to $178,006,383.

Alfa’s results for the first quarter of 2007 were affected by losses from the tornado in Enterprise, Alabama, as well as other storms throughout the state in February and March. The impact of these claims on Alfa Corporation’s first quarter earnings, after reinsurance and taxes, was $0.11 per diluted share compared with $0.08 per diluted share in the first quarter of 2006 from the same type of weather-related events. In addition, costs associated with the acquisition of Virginia Mutual and the related commutation of the inter-company quota share, together with the adoption of Statement of Position (SOP) 05-1, Accounting for Deferred Acquisition Costs In Connection With Modifications or Exchanges of Insurance Contracts, added approximately $1.7 million, after-tax, of additional expense in the first quarter of 2007, resulting in an additional earnings decline of $0.02 per diluted share during the quarter.

Alfa’s Chairman, President and Chief Executive Officer, Jerry A. Newby, said, “Storm losses had a significant impact on our first quarter results. When such dramatic events occur, our first thoughts are with our policyholders and taking care of them in their time of need. I am proud of the way our claims personnel responded as we dealt with storm damage across the state of Alabama. Despite this level of storm activity, stockholders’ equity increased $9.5 million for the quarter. We continue to experience sound top-line growth, and our core loss ratio remains outstanding at 57.8%.”

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ALFA Reports First Quarter 2007 Results

Page 2

May 2, 2007

Alfa Corporation will host a conference call on Wednesday, May 2, at 10:30 a.m. Eastern time. Investors and other interested parties may access the teleconference by calling 1-800-240-2430 or via links located on Alfa’s web site: www.alfains.com. A 30-day Internet replay of the call will also be available from Alfa’s web site.

Alfa Corporation is engaged in insurance and financial activities through its subsidiaries. The common stock of Alfa Corporation is traded on the Nasdaq Stock Market’s Global Select Market under the symbol ALFA.

The associated investor supplement package for the first quarter ended March 31, 2007, may be found by clicking on the web cast link in the “Invest in Alfa” section of Alfa’s web site and is also available at: http://www.irinfo.com/alfa/ALFA1Q07FS1.pdf.

Investors are cautioned that statements in this press release which relate to the future are, by their nature, uncertain and dependent upon numerous contingencies – including political, economic, regulatory, climatic, competitive, legal, and technological – any of which could cause actual results and events to differ materially from those indicated in such forward-looking statements. Additional information regarding these and other risk factors and uncertainties may be found in Alfa Corporation’s filings with the Securities and Exchange Commission.

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ALFA Reports First Quarter 2007 Results

Page 3

May 2, 2007

ALFA CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

(UNAUDITED)

		Three Months Ended March 31,							Statistics
		2007		2006		% Change			2007		2006
Revenues
Premiums - Property and Casualty Insurance		155,378,827		147,415,932		5.40
Premiums - Life Insurance		12,556,170		11,745,853		6.90
Policy Charges - Life Insurance		10,071,386		9,832,678		2.43
Net Investment Income		27,446,957		23,975,664		14.48
Other Income		8,614,685		7,369,745		16.89
Total Revenues		214,068,025		200,339,872		6.85
Benefits, Losses and Expenses
Benefits, Claims, Losses and Settlement Expenses		134,016,213		118,819,689		12.79			62.60		59.31
Dividends to Policyholders		1,144,010		1,115,000		2.60			0.53		0.56
Amortization of Deferred Policy Acquisition Costs		35,953,849		30,724,622		17.02			16.80		15.34
Other Operating Expenses		24,585,693		22,037,491		11.56			11.48		11.00
Total Benefits, Losses and Expenses		195,699,765		172,696,802		13.32			91.42		86.20
Income Before Income Tax Expense		18,368,260		27,643,070		(33.55	)		8.58		13.80
Income Tax Expense		4,854,101		7,587,991		(36.03	)		26.43		27.45
Operating Income		13,514,159		20,055,079		(32.61	)
Realized Investment Gains, Net of Tax		814,661		82,363		889.11
Net Income		14,328,820		20,137,442		(28.84	)
Operating Income Per Share - Basic		0.17		0.25		(32.77	)
Operating Income Per Share - Diluted		0.17		0.25		(32.96	)
Net Income Per Share - Basic		0.18		0.25		(29.01	)
Net Income Per Share - Diluted		0.18		0.25		(29.21	)
Dividends Per Share		0.11		0.10		10.00
Average Shares Outstanding - Basic		80,485,290		80,301,335		0.23
Average Shares Outstanding - Diluted		81,545,408		81,122,521		0.52

Management believes that operating income and operating income per share, non-GAAP financial measures, serve as meaningful tools for assessing the profitability of the Company’s ongoing operations. Operating income is defined by the Company as net income excluding realized investment gains and losses, net of applicable taxes. Operating income per share represents operating income divided by the weighted average shares outstanding for the reporting period. Management uses operating income and operating income per share as measures of the Company’s ongoing profitability since they eliminate the effect of securities market volatility from earnings.

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ALFA Reports First Quarter 2007 Results

Page 4

May 2, 2007

ALFA CORPORATION

CONSOLIDATED CONDENSED BALANCE SHEETS

		(Unaudited) March 31, 2007				December 31, 2006 (1)				% Change
Assets
Investments:
Fixed Maturities Held for Investment, at amortized cost (fair value $46,358 in 2007 and $57,272 in 2006)		$	44,251			$	55,052			-19.62	%
Fixed Maturities Available for Sale, at fair value (amortized cost $1,517,733,537 in 2007 and $1,436,188,473 in 2006)			1,529,945,399				1,446,693,702			5.75	%
Equity Securities Available for Sale, at fair value (cost $107,603,305 in 2007 and $101,177,606 in 2006)			116,735,113				111,427,207			4.76	%
Policy Loans			66,149,643				64,949,875			1.85	%
Collateral Loans			125,425,856				128,685,111			-2.53	%
Other Long-Term Investments			83,568,162				86,823,771			-3.75	%
Short-Term Investments			155,959,411				167,683,154			-6.99	%
Total Investments			2,077,827,835				2,006,317,872			3.56	%
Cash			28,378,550				37,218,109			-23.75	%
Other Long-Term Investments in Affiliates			117,396,766				120,819,010			-2.83	%
Accrued Investment Income			18,066,998				17,026,711			6.11	%
Accounts Receivable			93,090,208				84,100,246			10.69	%
Reinsurance Balances Receivable			7,944,975				6,015,853			32.07	%
Deferred Policy Acquisition Costs			227,672,566				224,516,950			1.41	%
Goodwill			9,576,218				9,576,218			0.00	%
Other Intangible Assets (net of accumulated amortization of $1,537,650 in 2007 and $1,366,800 in 2006)			7,570,350				7,741,200			-2.21	%
Other Assets			20,576,358				20,906,925			-1.58	%
Total Assets		$	2,608,100,824			$	2,534,239,094			2.91	%
Liabilities and Stockholders’ Equity
Policy Liabilities and Accruals - Property and Casualty Insurance		$	188,769,584			$	172,664,652			9.33	%
Policy Liabilities and Accruals - Life Insurance Interest-Sensitive Products			668,344,003				646,354,761			3.40	%
Policy Liabilities and Accruals - Life Insurance Other Products			210,528,311				205,449,027			2.47	%
Unearned Premiums			250,920,934				236,481,371			6.11	%
Dividends to Policyholders			11,748,981				11,882,776			-1.13	%
Premium Deposit and Retirement Deposit Funds			4,861,316				4,921,879			-1.23	%
Deferred Income Taxes			21,344,182				25,547,554			-16.45	%
Other Liabilities			86,616,272				75,222,398			15.15	%
Due to Affiliates			30,984,327				24,355,859			27.22	%
Commercial Paper			199,334,991				206,923,215			-3.67	%
Notes Payable			70,000,000				70,000,000			0.00	%
Notes Payable to Affiliates			28,267,675				27,516,459			2.73	%
Total Liabilities			1,771,720,576				1,707,319,951			3.77	%
Commitments and Contingencies
Stockholders’ Equity :
Preferred Stock, $1 par value			—				—			0.00	%
Shares authorized: 1,000,000
Issued: None
Common Stock, $1 par value			83,783,024				83,783,024			0.00	%
Shares authorized: 110,000,000
Issued: 83,783,024
Outstanding: 80,515,613 in 2007 and 80,459,113 in 2006
Capital in Excess of Par Value			31,029,684				27,502,452			12.83	%
Accumulated Other Comprehensive Income			14,215,033				14,200,535			0.10	%
(unrealized gains on securities available for sale, net of tax of $14,125,818 in 2007 and $14,019,988 in 2006; unrealized gains on interest rate swap contract, net of tax of $39,620 in 2007 and $105,541 in 2006; unrealized gains on other long-term investments, net of tax of $49,595 in 2007 and $75,006 in 2006)
Retained Earnings			744,272,988				738,811,778			0.74	%
Treasury Stock, at cost (shares, 3,267,411 in 2007 and 3,323,911 in 2006)			(36,920,481	)			(37,378,646	)		-1.23	%
Total Stockholders’ Equity			836,380,248				826,919,143			1.14	%
Total Liabilities and Stockholders’ Equity		$	2,608,100,824			$	2,534,239,094			2.91	%
Book Value per share		$	10.39			$	10.28

⁽¹⁾ Derived from audited financial statements

-END-

Alfa Corporation

Investor Supplement

First Quarter 2007

This Investor Supplement is for informational purposes only. The consolidated financial statements and financial exhibits included herein are unaudited. These consolidated financial statements and exhibits should be read in conjunction with the consolidated financial statements and notes thereto included in Form 10-K.

Measures used in these financial statements and exhibits that are not based on generally accepted accounting principles (“non-GAAP”) are denoted with an asterisk (*) the first time they appear. These measures are defined on the page “Definitions of Non-GAAP, GAAP and Operating Measures” and are reconciled to the most directly comparable GAAP measure herein.

ALFA CORPORATION

PROPERTY/CASUALTY SEGMENT (UNAUDITED)

(in thousands, except ratios and per share data)

		Three Months Ended March 31,											Ratios
		2007				2006				% Change			2007			2006
INCOME STATEMENT
Revenues
Automobile Premiums		$	96,989			$	92,499			4.9
Homeowner Premiums			54,150				51,509			5.1
Other Premiums			4,240				3,408			24.4
Total Premiums - Property and Casualty Insurance			155,379				147,416			5.4			100.0	%		100.0	%
Net Investment Income			11,561				9,679			19.4
Other Income			4,844				3,414			41.9
Total Revenues			171,784				160,509			7.0
Benefits, Losses and Expenses
Incurred Losses (Non-storm)			89,787				82,009			9.5			57.8	%		55.6	%
Incurred Losses (Storm)			13,915				9,912			40.4			9.0	%		6.7	%
Loss Adjustment Expense			7,930				7,044			12.6			5.1	%		4.8	%
Total Benefits, Claims, Losses and Settlement Expenses			111,632				98,965			12.8			71.9	%		67.1	%
Amortization of Deferred Policy Acquisition Costs			31,379				27,780			13.0			20.2	%		18.8	%
Other Operating Expenses			15,032				13,767			9.2			9.7	%		9.3	%
Total Operating Expenses			46,411				41,547			11.7			29.9	%		28.1	%
Total Benefits, Losses and Expenses			158,043				140,512			12.5			101.8	%		95.2	%
Income Before Income Tax Expense			13,741				19,997			(31.3	)
Income Tax Expense			3,330				5,134			(35.1	)
Operating Income *			10,411				14,863			(30.0	)
Realized Investment Gains (Losses), Net of Tax			(1,400	)			(689	)		(103.2	)
Net Income		$	9,011			$	14,174			(36.4	)
Operating Income Per Share - Diluted *		$	0.13			$	0.18			(30.3	)
Net Income Per Share - Diluted		$	0.11			$	0.17			(36.8	)
Operating Return on Equity*			16.8	%			17.9	%
Return on Equity*			16.0	%			17.2	%
Other Key Information
Earned Premium by Market
Alabama		$	111,689			$	109,417			2.1			71.9	%		74.2	%
Georgia			7,913				7,904			0.1			5.1	%		5.4	%
Mississippi			10,616				9,848			7.8			6.8	%		6.7	%
Alliance/VA Mutual			5,666				5,329			6.3			3.7	%		3.6	%
Nonstandard			19,495				14,918			30.7			12.6	%		10.1	%
Total Earned Premium		$	155,379			$	147,416			5.4			100.0	%		100.0	%
Incurred Losses by Market (Non-storm)
Alabama		$	63,002			$	59,984			5.0			56.4	%		54.8	%
Georgia			5,261				5,118			2.8			66.5	%		64.8	%
Mississippi			6,048				4,736			27.7			57.0	%		48.1	%
Alliance/VA Mutual			1,520				2,494			(39.1	)		26.8	%		46.8	%
Nonstandard			13,956				9,677			44.2			71.6	%		64.9	%
Total Incurred Losses		$	89,787			$	82,009			9.5			57.8	%		55.6	%
Lapse Ratio: Preferred and Standard Classes *			3.17	%			3.43	%
Net Written Premium by LOB
Automobile		$	105,400			$	108,589			(2.9	)
Homeowner			53,822				50,855			5.8
Other			4,891				4,535			7.9
Total Net Written Premium		$	164,113			$	163,979			0.1
Net Written Premium by Market
Alabama		$	114,072			$	111,715			2.1
Georgia			8,208				8,218			(0.1	)
Mississippi			10,446				10,576			(1.2	)
Alliance/VA Mutual			6,264				4,425			41.6
Nonstandard			25,123				29,045			(13.5	)
Total Net Written Premium		$	164,113			$	163,979			0.1

Data may differ from actual due to rounding.

ALFA CORPORATION

LIFE SEGMENT (UNAUDITED)

(in thousands, except ratios and per share data)

		Three Months Ended March 31,											Ratios
		2007				2006				% Change			2007			2006
INCOME STATEMENT
Revenues
Traditional Life Insurance Premiums		$	12,167			$	11,255			8.1
Universal Life Policy Charges			5,573				5,392			3.4
Universal Life Policy Charges - COLI			1,673				1,699			(1.5	)
Interest-sensitive Life Policy Charges			2,825				2,741			3.1
Annuity Policy Charges			—				—			0.0
Group Life Insurance Premiums			536				491			9.2
Total Premiums and Policy Charges - Life Insurance			22,774				21,578			5.5			100.0	%		100.0	%
Net Investment Income			14,638				13,590			7.7
Other Income			—				—			0.0
Total Revenues			37,412				35,168			6.4
Benefits, Claims, Losses and Settlement Expenses			22,590				19,981			13.1			99.2	%		92.6	%
Dividends to Policyholders			1,144				1,115			2.6			5.0	%		5.2	%
Amortization of Deferred Policy Acquisition Costs			4,575				2,945			55.3			20.1	%		13.6	%
Other Operating Expenses			4,417				4,015			10.0			19.4	%		18.6	%
Total Benefits, Losses and Expenses			32,726				28,056			16.6			143.7	%		130.0	%
Income Before Income Tax Expense			4,686				7,112			(34.1	)
Income Tax Expense			1,483				2,234			(33.6	)
Operating Income			3,203				4,878			(34.3	)
Realized Investment Gains, Net of Tax			2,215				771			187.3
Net Income		$	5,418			$	5,649			(4.1	)
Operating Income Per Share - Diluted		$	0.04			$	0.06			(34.7	)
Net Income Per Share - Diluted		$	0.07			$	0.07			(4.6	)
Operating Return on Equity			6.8	%			7.4	%
Return on Equity			8.9	%			9.1	%
Other Key Information (all information presented on a STAT-basis)
Annualized New Business Premium by LOB
Traditional Life		$	3,566			$	4,231			(15.7	)
Universal Life			1,127				1,106			1.9
Interest-sensitive Life			631				597			5.7
Total Issued New Business Premium by LOB		$	5,324			$	5,934			(10.3	)
Annualized New Business Premium by Region
Alabama		$	4,605			$	5,195			(11.4	)
Georgia			361				406			(11.1	)
Mississippi			358				333			7.5
Total Issued New Business Premium by Region		$	5,324			$	5,934			(10.3	)
Actual vs. Expected Mortality Ratio *			102	%			99	%
Persistency Ratio *			90.6	%			91.4	%

Data may differ from actual due to rounding.

ALFA CORPORATION

NONINSURANCE SEGMENT (UNAUDITED)

(in thousands, except ratios and per share data)

		Three Months Ended March 31,
		2007				2006				% Change
INCOME STATEMENT
Revenues
Equity Interest in MidCountry Financial (net of expense)		$	465			$	514			(9.5	)
Loan Income (net of expense)			1,996				1,155			72.8
Other Net Investment Income			339				162			109.3
Total Net Investment Income			2,800				1,831			52.9
Fee/Commission Income - Agency Operations			10,014				10,810			(7.4	)
Other Income			273				345			(20.9	)
Total Other Income			10,287				11,155			(7.8	)
Total Revenues			13,087				12,986			0.8
Benefits, Losses and Expenses
Claims and Settlement Expenses - Agency Operations			1,097				733			49.7
Other Operating Expenses - Loan/Lease Operations			1,162				1,274			(8.8	)
Other Operating Expenses - Agency Operations			7,652				9,044			(15.4	)
Other Operating Expenses - Other Operations			306				345			(11.3	)
Total Benefits, Losses and Expenses			10,217				11,396			(10.3	)
Income Before Income Tax Expense			2,870				1,590			80.5
Income Tax Expense			1,066				589			81.0
Operating Income (Loss)			1,804				1,001			80.2
Realized Investment Gains (Losses), Net of Tax			—				—			0.0
Net Income (Loss)		$	1,804			$	1,001			80.2
Operating Income (Loss) Per Share - Diluted		$	0.02			$	0.01			79.3
Net Income (Loss) Per Share - Diluted		$	0.02			$	0.01			79.3
Operating Return on Equity			1.3	%			0.4	%
Return on Equity			1.3	%			0.3	%
Other Key Information		3/31/07				3/31/06				% Change
Alfa Financial Corporation:
Loan Portfolio		$	125,061			$	127,210			(1.7	)
Loan Portfolio Yield *			7.96	%			7.51	%
Loan Gross Charge-offs		$	(732	)		$	172
Loan Net Charge-offs		$	(752	)		$	134
Loan Delinquency Ratio *			1.59	%			1.12	%
MidCountry Financial Corporation:
Carrying Value (42% and 43% ownership at 3/31/07 and 3/31/06, respectively)		$	58,129			$	53,910			7.8
Equity in Net Earnings		$	465			$	514			(9.5	)
Return on Carried Value *			3.2	%			3.8	%

Data may differ from actual due to rounding.

ALFA CORPORATION

CORPORATE SEGMENT AND ELIMINATIONS (UNAUDITED)

(in thousands, except ratios and per share data)

		Three Months Ended March 31,
		2007				2006				% Change
INCOME STATEMENT
Revenues
Premiums - Life Insurance		$	(146	)		$	—			(100.0	)
Investment Loss			(191	)			(201	)		5.0
Interest Expense			(1,362	)			(923	)		(47.6	)
Total Net Investment Loss			(1,553	)			(1,124	)		(38.2	)
Other Income			(6,517	)			(7,199	)		9.5
Total Revenues			(8,216	)			(8,323	)		1.3
Benefits, Losses and Expenses
Claims and Settlement Expenses			(1,302	)			(859	)		(51.6	)
Amortization of Deferred Policy Acquisition Costs			—				—			0.0
Other Operating Expenses			(3,984	)			(6,408	)		37.8
Total Benefits, Claims, Losses and Settlement Expenses			(5,286	)			(7,267	)		27.3
Loss Before Income Tax Expense (Benefit)			(2,930	)			(1,056	)		(177.5	)
Income Tax Expense (Benefit)			(1,025	)			(370	)		(177.0	)
Operating Income (Loss)			(1,905	)			(686	)		(177.7	)
Realized Investment Gains (Losses), Net of Tax			—				—			0.0
Net Income (Loss)		$	(1,905	)		$	(686	)		(177.7	)
Operating Income (Loss) Per Share - Diluted		$	(0.02	)		$	(0.01	)		(176.3	)
Net Income (Loss) Per Share - Diluted		$	(0.02	)		$	(0.01	)		(176.3	)

Data may differ from actual due to rounding.

ALFA CORPORATION

INVESTMENT PORTFOLIO

(in thousands, except ratios and per share data)

				Three Months Ended March 31,
				2007				2006				% Change
Alfa Corporation Consolidated Investment Portfolio - Other Key Information
															Yields
Net Investment Income and Pre-tax Yield:															2007			2006
Fixed Income Securities				$	21,276			$	19,458			9.3			5.8	%		5.6	%1
Equity Securities					989				964			2.6			3.4	%		3.6	%
Collateral Loans					2,527				2,343			7.9
Commercial Leases					23				48			(52.1	)
Other Investment Income					7,284				5,846			24.6
Interest Expense					(3,918	)			(3,422	)		(14.5	)
Investment Expenses					(733	)			(1,261	)		41.9
Total Net Investment Income				$	27,448			$	23,976			14.5
Investment Portfolio Composition:				3/31/07				12/31/06
Fixed Income Securities, by Rating:2
NAIC Rated		Moody’s Rated
1		Aaa/Aa/A		$	1,443,734			$	1,353,897			6.6
2		Baa			79,219				83,338			(4.9	)
3		Ba			2,065				2,060			0.2
4		B			1,972				4,454			(55.7	)
5		Caa			—				—			0.0
6		In or near default			—				—			0.0
Not Rated					3,000				3,000			0.0
Total Fixed Income Securities					1,529,990				1,446,749			5.8
Equity Securities					116,735				111,427			4.8
Collateral Loans					125,426				128,685			(2.5	)
Other Invested Assets					305,677				319,457			(4.3	)
Total Investments					2,077,828				2,006,318			3.6
Investment In Affiliates					117,397				120,819			(2.8	)
Total				$	2,195,225			$	2,127,137			3.2

¹ Yield on Fixed Income Securities is calculated as annualized income divided by the average of the beginning and end of period amortized investment balances for the same 12-month period, which exclude unrealized investment gains and losses.

² Investment Portfolio Composition values for Fixed Income Securities are based on fair value for available for sale securities and amortized value for held for investment securities.

Data may differ from actual due to rounding.

ALFA CORPORATION

QUARTERLY FINANCIAL SUPPLEMENT

March 31, 2007

(Unaudited)

Additional Information

		03:1Q		03:2Q		03:3Q		03:4Q		2003
Pretax P&C Net Investment Income		6,910,185		7,653,547		7,423,546		6,516,131		28,503,409
Pretax P&C Operating Income		20,276,043		16,813,874		16,415,815		16,120,258		69,625,990
P&C Statutory Invested Assets		619,015,221		626,103,044		640,677,141		643,775,395
P&C Statutory Surplus		300,514,053		308,384,829		314,946,117		323,362,342
P&C Loss & LAE Reserves(1)		144,689,722		145,691,012		147,585,697		139,589,753
Pretax Life Net Investment Income		11,534,769		10,948,305		10,843,170		11,408,366		44,734,610
Pretax Life Operating Income		5,630,299		6,071,633		5,514,256		9,528,981		26,745,169
Life Statutory Invested Assets		771,143,631		809,472,299		808,833,684		823,345,514
Life Statutory Surplus		127,075,494		130,374,293		133,237,013		144,834,065
		04:1Q		04:2Q		04:3Q		04:4Q		2004
Pretax P&C Net Investment Income		7,422,200		7,529,905		8,148,041		11,646,118		34,746,264
Pretax P&C Operating Income		26,792,114		19,926,490		21,346,862		22,743,798		90,809,264
P&C Statutory Invested Assets(2)		663,386,315		668,080,084		722,795,981		716,630,234
P&C Statutory Surplus		335,394,591		343,130,340		340,815,304		369,838,232
P&C Loss & LAE Reserves(1)		144,839,184		144,417,593		151,118,973		150,856,684
Pretax Life Net Investment Income		11,464,207		12,070,627		13,044,596		12,549,202		49,128,632
Pretax Life Operating Income		6,101,031		4,881,196		5,704,300		8,778,931		25,465,458
Life Statutory Invested Assets		850,439,601		865,246,778		876,301,256		890,441,591
Life Statutory Surplus		147,078,186		149,627,085		151,079,986		161,992,039
		05:1Q		05:2Q		05:3Q		05:4Q		2005
Pretax P&C Net Investment Income		9,310,764		8,926,932		11,232,799		10,729,178		40,199,673
Pretax P&C Operating Income		19,002,266		33,255,773		29,255,953		24,178,448		105,692,440
P&C Statutory Invested Assets(2)		705,855,331		715,563,873		720,574,977		733,114,630
P&C Statutory Surplus		372,285,887		385,401,304		398,052,284		407,475,146
P&C Loss & LAE Reserves(1)		145,569,327		141,926,723		149,282,527		157,988,560
Pretax Life Net Investment Income		12,226,938		13,061,800		12,661,842		13,012,004		50,962,584
Pretax Life Operating Income		7,722,260		7,001,604		6,004,445		9,749,301		30,477,610
Life Statutory Invested Assets		923,042,022		932,889,527		957,943,993		957,658,384
Life Statutory Surplus		163,786,697		167,102,347		171,890,971		177,189,239
		06:1Q		06:2Q		06:3Q		06:4Q		2006
Pretax P&C Net Investment Income		9,678,917		8,867,842		10,230,689		10,639,827		39,417,275
Pretax P&C Operating Income		19,996,255		32,528,491		27,338,061		29,125,239		108,988,046
P&C Statutory Invested Assets(2)		781,525,886		792,053,522		789,965,735		815,633,254
P&C Statutory Surplus		410,789,564		430,367,018		424,266,223		450,690,007
P&C Loss & LAE Reserves(1)		163,390,031		161,008,518		164,960,736		170,675,884
Pretax Life Net Investment Income		13,590,101		13,716,250		14,296,140		14,924,804		56,527,295
Pretax Life Operating Income		7,113,633		6,783,319		8,585,952		11,599,737		34,082,641
Life Statutory Invested Assets		1,002,957,159		999,648,875		1,017,945,275		1,031,591,536
Life Statutory Surplus		182,409,009		179,808,669		184,518,325		202,198,338
		07:1Q		07:2Q		07:3Q		07:4Q		2007
Pretax P&C Net Investment Income		11,561,426								11,561,426
Pretax P&C Operating Income		13,742,157								13,742,157
P&C Statutory Invested Assets(2)		858,199,394
P&C Statutory Surplus		458,720,955
P&C Loss & LAE Reserves(1)		186,168,206
Pretax Life Net Investment Income		14,638,077								14,638,077
Pretax Life Operating Income		4,685,844								4,685,844
Life Statutory Invested Assets		1,066,821,010
Life Statutory Surplus		206,159,735

⁽¹⁾ P&C Loss & LAE Reserves for fourth quarter 2003, fourth quarter 2004 and periods beginning in 2005 include salvage and subrogation receivables.

⁽²⁾ P&C Statutory Invested Assets for fourth quarter 2004 and periods beginning in 2005 reflect a reclassification of premium installment plan receivables into Accounts Receivable.

Definitions of Non-GAAP, GAAP and Operating Measures

Management believes that disclosure of the following non-GAAP financial measures provides investors with meaningful tools to assess the Company’s ongoing operations. Our methods of calculating these measures may differ from those used by other companies, thereby limiting comparability.

Operating Income is defined as net income excluding realized investment gains and losses, net of applicable taxes. Management uses operating income as a measure of the Company’s ongoing profitability since it eliminates the effect of securities market volatility from earnings.

Operating Income per Share is defined as operating income divided by the weighted average shares outstanding for the reporting period. Management uses operating income per share as a measure of the Company’s ongoing profitability since it eliminates the effect of securities market volatility from earnings.

Operating Return on Equity (Current Period) is defined as operating income for the trailing 12-month period divided by the simple average of the beginning and ending stockholders’ equity of the same 12-month period.

Operating Return on Equity (Prior Period) is defined as operating income for the prior year divided by the simple average of the beginning and ending stockholders’ equity of the same 12-month period.

Return on Equity (Current Period) is defined as net income for the trailing 12-month period divided by the simple average of the beginning and ending stockholders’ equity of the same 12-month period.

Return on Equity (Prior Period) is defined as net income for the prior year divided by the simple average of the beginning and ending stockholders’ equity of the same 12-month period.

Management uses the following GAAP ratios to measure the Company’s ongoing operations. They are calculated as follows:

Loss Ratio is defined as incurred losses divided by earned premiums.

Loss Adjustment Expense Ratio is defined as loss adjustment expenses divided by earned premiums.

Operating Expense Ratio is defined as total operating expenses divided by earned premiums.

Combined Ratio is defined as the sum of the loss ratio, the loss adjustment expense ratio and the expense ratio or the sum of incurred losses, loss adjustment expenses and total operating expenses divided by earned premiums.

Management uses the following operating statistics to measure components of the Company’s ongoing operations. They are calculated as follows:

Lapse Ratio is defined as the number of policies lapsing as a percentage of billings produced during a stated time period.

Actual vs. Expected Mortality Ratio is defined as benefit payments divided by the actuarially estimated benefit payments for the stated time period.

Persistency Ratio is defined as the annualized premium of policies in force at the end of the period as a percentage of the annualized premium paid at the end of the period.

Loan Portfolio Yield is defined as annualized interest income divided by the loan portfolio balance.

Loan Delinquency Ratio is defined as the amount of loans 30 or more days past due divided by the loan portfolio balance.

Return on Carried Value is defined as equity in net earnings divided by the simple average of beginning and end of period carrying value.

Certain amounts in prior periods have been reclassified to conform to the presentation adopted in the current period. Such reclassifications did not impact earnings.