8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) September 2, 2008

PMA Capital Corporation

(Exact name of registrant as specified in its charter)

Pennsylvania	001-31706	23-2217932
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

380 Sentry Parkway Blue Bell, Pennsylvania	19422
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:   (610) 397-5298

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01.  Regulation FD Disclosure.

On September 3, 2008, the Chief Executive Officer and Chief Financial Officer of PMA Capital Corporation will be delivering a presentation at the Keefe, Bruyette & Woods, Inc. Annual Insurance Conference.  A copy of the presentation is being furnished as a part of this Current Report on Form 8-K as Exhibit 99.1 and is incorporated by reference herein. 

Item 9.01.  Financial Statements and Exhibits.

(d)  Exhibits.

Exhibit 99.1     PMA Capital Corporation Investor Presentation

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PMA Capital Corporation
September 2, 2008	By:	/s/ William E. Hitselberger
	Name:		William E. Hitselberger
	Title:		Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.      Description

Exhibit 99.1     PMA Capital Corporation Investor Presentation

EX-99.1

Exhibit 99.1

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Keefe, Bruyette & Woods, Inc.

Investor Conference

September 3-4, 2008

Forward-looking
statements

qThis presentation and our discussion contain
forward-lookinginformation and statements
including, but not limited to, such matters as
business strategies, market trends, future
financial performance, and other matters which
inherently involve risks and uncertainties which
could cause actual results to differ from those
projected or implied in the forward-looking
statements.Please refer to the Company’s SEC
filings including its most recent Annual Report on
Form 10-K for risk factors which could cause
actual performance to differ from these forward-
looking statements.

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Who We Are

Two Ongoing Operating Segments

The PMA Insurance Group

qSolid presence in workers’ compensation market

qDisciplined underwriting standards

qSuperior long-term client relationships

qStatutory capital of $352 million

Fee-based Business

qIncludes combined operating results of PMA
Management Corp. and Midlands Management
Corporation

qAcquisition of Midlands in October 2007 provides
expanded fee-based services and customer base

qIn June 2008, acquired a workers’ compensation TPA
in Connecticut, a market we previously had little
penetration

Run-Off Operations- Sale agreement executed
in 2008, pending state approval

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____________________

*Based on direct premiums written, excludes fronting premiums.

MI

FL

DE

MD

KY

ME

NY

PA

VT

NH

MA

RI

CT

VA

WV

OH

IN

IL

NC

TN

SC

AL

MS

WI

NJ

GA

NM

TX

OK

KS

NE

SD

ND

MT

WY

CO

UT

ID

AZ

NV

WA

CA

OR

AR

LA

MO

IA

MN

PA

36%

NY

10%

NJ

12%

MD

6%

VA

4%

FL

6%

NC

4%

GA

3%

TN

3%

DE

3%

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MI

FL

DE

MD

KY

ME

NY

PA

VT

NH

MA

RI

CT

VA

WV

OH

IN

IL

NC

TN

SC

AL

MS

WI

NJ

GA

NM

TX

OK

KS

NE

SD

ND

MT

WY

CO

UT

ID

AZ

NV

WA

CA

OR

AR

LA

MO

IA

MN

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PMA has 50 state writing and servicing capabilities

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Highlights

q 2008 Focus:

§Profitable, measured growth at Primary
Insurance Operations

§High client retention and expansion of Fee-
based business opportunities, as demonstrated
by high rate of organic growth and June 2008
acquisition

§Assist with regulatory review process in order
to obtain approval to close the sale of the Run-
off Operations

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($ millions, except per share)	2008	2007
Direct premiums written	$239.5	$271.7
Net premiums earned	188.5	190.9
Fee-based revenues	31.8	15.2
Operating income from continuing operations	11.6	6.5
Loss from discontinued operations	(2.6)	(2.6)
After Tax Capital Gains (Losses)	1.9	(.1)
Net income	$10.9	$3.8
Earnings per share from continuing operations	$.42	$.19
Loss per share from discontinued operations	(.08)	(.07)
Earnings per share	$.34	$.12

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Consolidated
Year to Date 6/30 Results

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Consolidated
Six Month Results

qImproved underwriting results at The PMA
Insurance Group (combined ratio 97.2% vs.
99.9% in 2007)

qPre-tax operating income increased by 33% at
The PMA Insurance Group, compared to first six
months of 2007

qFee-based revenues increased $16.6 million to
$31.8 million due to acquisition of Midlands and
organic growth at PMA Management Corp.

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The PMA Insurance Group

Business
Overview

qSpecializes in workers’ compensation and
other commercial lines

qFocus on mid-size to large accounts

§Commercial Markets

§Risk Management Services

§Specialty Markets

qReputation for excellent customer service
and execution

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*Excluding Fronting Premiums

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Diversified Distribution Channels

Premium Profile by Source*

FY 2007

Q2 2008

* Excluding Fronting Premiums

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Source: AM Best

qDisciplined underwriting -> Consistent operating
returns

qThe PMA Insurance Group - Workers’ Compensation
Estimated Undiscounted Accident Year Net Loss and
LAE Ratio (2003 adjusted for retro premium)

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Maintain competitive advantage
in workers’ compensation line

qLong-term strategy of Insurance Group is to write
workers compensation business at a combined ratio of
100% through underwriting cycle.

qJune year to date 2008 combined ratio of 97.2%, 2007 full
year combined ratio was 99.7%

qMeasured steps to improve expense ratio, while
maintaining service levels to customer-

qExpense target is currently to maintain controllable
expense growth less than half the rate of direct premium
growth

qClaims Strategic Alliances assist in managing loss costs

§Medical networks

§Bill review

§Catastrophic claims

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Managing the Loss
and LAE Ratio

qPricing changes, coupled with payroll inflation for
rate sensitive workers’ compensation business
were below overall estimated loss trends

qDiversification among classes of business insured

qLoss containment protection in loss sensitive
business (about 40-45% of our business) reduce
risk to Company

qOutcome focused claims philosophy

§Full integration of nurse professionals in claims process

§In-house counsel in select jurisdictions

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Managing the Loss
and LAE Ratio

qStrategic alliances:

§Coventry: preferred provider network; out of network
bill review

§QualCare: preferred provider network in NJ

§MedRisk: physical therapy provider

§Corporate Systems: detailed medical bill review

§TMESYS: retail pharmacy program

§Paradigm: catastrophic claim management

§Computer Sciences Corporation: legal bill review

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Fronting Arrangements

qPMA earns an administrative fee - spread
between ceding commissions and direct
commissions - - reduced the acquisition expense
ratios by 90 basis points in 2008 and 60 basis
points for the same period in 2007

qNew arrangements effective in 3Q 2008 with
Appalachian Underwriters, Inc (predominantly in
south/southeast) and Arrowhead General
Insurance Agency (California).PMA Management
Corp. will also derive fees from claims work on
the Appalachian arrangement

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Fee-based Business

qIn fourth quarter of 2007, began reporting Fee-based
Business results in a separate operating segment

qPMA Management Corp.

§Third-Party Administrator (TPA) producing fee-based revenues

§Focus on workers’ compensation & risk management services

§Business shares IT infrastructure with PMA Insurance Group

qMidlands Management Corporation

§Acquired October 1, 2007

§Oklahoma City-based managing general agent (MGA), program
administrator and provider of TPA services

§Little overlap with PMA Management Corp.

§In June 2008, we acquired Webster Risk Services, which
will operate as PMA Management Corp. of New England

§Revenues and margins from our fee-based businesses are
less volatile than insurance underwriting

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PMA Management
Corp.

qBroad service capabilities:

§Claims administration/TPA

§Managed care

§Disability management

§Risk control

qSolid portfolio of managed care strategic alliances that
leverage combined purchasing power with insurance
operations

qThree-year business retention of over 90%

qRevenue CAGR of over 16% since 2001 - continue to see
organic growth opportunities

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Midlands Management
Corporation

qAcquired October 1, 2007- Initial cash paid of $19.8 million

§Ultimate price, which is based on EBITDA growth levels
over next four years, could range from $22.8 million
(6.9x EBITDA) to $44.5 million (4.8x EBITDA)

qOverview of Midlands

§Very strong name recognition and brand equity

§TPA specializes in casualty claims adjusting

§Managing general agency places excess workers’
compensation

§Revenues in 2007 of $28 million

§Will continue to operate in current markets with existing
management and will maintain its brand identity and
strong service culture

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PMA Management Corp.
of New England

qConnecticut-based TPA, formerly Webster Risk Services

qPurchased price of $7.3 million, closing adjustments reduced
cash transferred to $5.9 million

qSpecializes in providing workers’ compensation and risk
management services to health care systems and public
entities

qVery little geographical overlap - expect to grow current New
England revenue base of $6 million

qOn an annual basis, expected to add 2 cents to earnings-
excludes any potential cross-selling

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Holding Company Review

$ millions	6/30/08	12/31/07
Shareholders' Equity (Including SFAS #115)	$380.6	$378.6
Shareholders' Equity (Excluding SFAS #115)	$387.8	$374.6
Debt	$129.8	$131.3
Debt to Capital (Including SFAS #115)	25%	26%

Capitalization

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$ millions	6/30/08
Trust Preferred and Surplus Notes, Mature 2033-37	$74.4
Monthly Notes, Matures 2018	54.9
Other	.5
Total	$ 129.8

Debt Structure

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Invested Assets

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Total = $801 million

(excludes cash)

June 30, 2008

Asset Type

nConservative
investment posture

nNo wrapped ABS CDO
exposures

nNo derivatives

nNo equity exposure

nPre-tax net unrealized
loss of $11 million at
June 30, 2008

nOutside professional
manager

High-Quality, Liquid
Investment Portfolio

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Total = $741 million

(excludes short-term investments and cash)

June 30, 2008

Asset Quality

nAAA- average credit
quality

n72% AAA Rated or
Government bonds

n2% held in Alternative A/
Subprime loans - average
credit quality of AAA with
no OTTI

n2% held in credit-
enhanced securities with
average credit quality of
A+ and imputed credit
quality of A

nPortfolio duration - 3.8
years

nCurrent portfolio book
yield - - 5.0%

High-Quality, Liquid
Investment Portfolio

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1 Fee-based Business book value increased $0.23 as a result of the acquisition of
PMA Management Corp. of New England. The purchase price was funded by the
Holding Company.

PMA Capital
Book Value

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q2008 results through June detail execution of our business
plan:

§Measured revenue growth at The PMA Insurance Group

§Diligent expense management

§Continued expansion of fee-based service platform

qExpecting profitable growth in workers’ compensation in
2008

qExecution of 2008 plan should result in continued
improvement in profitability of operations

qExpect a return on equity of between 5.5% and 6.5% on
our ongoing businesses in 2008

qJune 30, 2008 book value of $11.92 per share, compared
to a current stock price (August 26) of $9.50

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