Exhibit (c)(12)

Milliman Client Report

CNA SURETY CORPORATION

ESTIMATE OF UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES
AS OF DECEMBER 31, 2010

Prepared for:

Mr. Philip Britt
Special Committee of the Board of Directors
CNA Surety Corporation

Prepared by:
Milliman, Inc.

Chad C. Karls, FCAS, MAAA
Principal and Consulting Actuary

January 21, 2011

15800 W. Bluemound Road, Suite 100
Brookfield, WI 53005
TEL +1 262 784 2250
FAX +1 262 923-3686
Milliman.com

Milliman

CNA SURETY CORPORATION

ESTIMATE OF UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES
AS OF DECEMBER 31, 2010

TABLE OF CONTENTS

Section	Page
INTRODUCTION		1
DISCLOSURES AND LIMITATIONS		3
LIMITED DISTRIBUTION		5
BACKGROUND ON MEMBER COMPANIES		7
SUMMARY OF RESULTS		8
DISCUSSION OF CEDED REINSURANCE		13
WSC DIRECT WRITTEN BUSINESS		15
WSC EXPOSURE ASSUMED FROM CNA FINANCIAL		20
BUSINESS WRITTEN BY SBCA		26
BUSINESS WRITTEN BY USA		28
CLOSING		30
EXHIBITS
ATTACHMENT A — TECHNICAL APPENDIX TABLE OF CONTENTS

Milliman

CNA SURETY CORPORATION

ESTIMATE OF UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES
AS OF DECEMBER 31, 2010

INTRODUCTION

This report summarizes our review of the statutory unpaid claim liabilities of the CNA Surety Corporation (CNA Surety) as of December 31, 2010. CNA Surety consists of Western Surety Company (WSC), the Surety Bonding Company of America (SBCA), and Universal Surety of America (USA). CNA Surety is the largest publicly traded surety within the United States and is 62% owned by subsidiaries of the CNA Financial Corporation (CNA Financial). All members of CNA Surety have received an A rating from A.M. Best.

CNA Surety announced on November 1, 2010 that it is considering a proposal by CNA Financial to purchase all outstanding shares of common stock in CNA Surety not currently owned by subsidiaries of CNA Financial. In conjunction with that proposal, we have been requested by the Special Committee of the Board of Directors of CNA Surety (Special Committee) to prepare this analysis. We further understand that this report may be filed with the Securities and Exchange Commission (SEC).

Milliman has been retained by the Special Committee to perform an actuarial analysis of its unpaid loss and loss adjustment expense (LAE) as of December 31, 2010. Our methodology consists of a detailed review of CNA Surety’s claims experience as of September 30, 2010 by member company and segment of business. This methodology allowed us to derive indications of the expected paid and incurred loss and paid allocated loss adjustment expense (ALAE) by accident year. We have incorporated these indications of the expected paid and incurred experience together with the actual paid and incurred experience by accident year as of December 31, 2010 to derive indicated unpaid loss and ALAE as of December 31, 2010.

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We have not reviewed any other financial statement items of CNA Surety. Finally, all references to the CNA Surety carried reserves reflect data and information provided to us as of January 18, 2011. We have not been provided the information to verify that these carried reserves reconcile to CNA Surety’s audited financial statements.

In our prior role as Appointed Actuary for CNA Surety, we have previously prepared summary reports and technical appendices detailing our review of the unpaid claim liabilities of the individual members of CNA Surety as of December 31, 2009. There have been no material changes in procedures, methodology or significant assumptions used in deriving our estimates since our previous analysis.

A Technical Appendix accompanies this report and provides the underlying details of the methodology, assumptions and conclusions used in developing our estimates of the statutory unpaid claim liabilities for each company and line of business within the scope of our review. As such, the Technical Appendix should be considered an integral part of this report.

Our estimate of CNA Surety’s indicated loss and LAE reserve can be characterized as an actuarial central estimate. Such an estimate represents an expected value over a range of reasonably possible outcomes. It does not reflect all conceivable events where the contribution of such events to an expected value is not reliably estimable. The estimate is not defined by a precise statistical measure (e.g., mean, median, mode, etc.), but is selected from multiple generally accepted actuarial methods that are intended to respond to various determinants of CNA Surety’s ultimate claim liabilities.

Chad C. Karls is a Fellow of the Casualty Actuarial Society and a Member of the American Academy of Actuaries (AAA) and meets the Qualification Standards of the AAA to render the actuarial opinion contained herein.

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DISCLOSURES AND LIMITATIONS

In performing this analysis, we have relied on data and other information provided to us by Mr. Chuck Gegax, Assistant Vice President and Actuary of CNA Surety and Mr. John Corcoran, Senior Vice President and Chief Financial Officer of CNA Surety. We have not audited or verified this data or information nor have we reconciled this data to CNA Surety’s audited financial statements. If the underlying data or information is inaccurate or incomplete, our analysis may likewise be inaccurate or incomplete. We have performed a limited review of the data used directly in our analysis solely for reasonableness and consistency, and have not found material defects in the data. If there are material defects in the data, it is possible that they would be uncovered by a detailed, systematic review and comparison of the data to search for data values that are questionable or relationships that are materially inconsistent. Such a review was beyond the scope of our assignment.

CNA Surety cedes to third party reinsurers part of its exposure to limit its liability for losses. We have not reviewed the various reinsurance contracts that affect our unpaid claim estimates, but rather are relying on a description of those provisions provided by CNA Surety management to estimate the expected reinsurance recoverable. The net unpaid loss and LAE estimates discussed in this report reflect this reinsurance. Our estimates assume that all ceded reinsurance is valid and collectible. Contingent liability exists with respect to ceded reinsurance that could become an actual liability to CNA Surety in the event that the reinsuring companies might be unable or unwilling to meet their obligations under existing reinsurance agreements.

We have not reviewed individual claim files or the process for claims handling used at the member companies. Such a review was outside the scope of our analysis. It is possible that such a review would have disclosed additional factors relevant to our analysis.

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Finally, any study of unpaid claims involves estimates of future contingencies. While our unpaid claim estimates represent our best professional judgment, arrived at after careful actuarial analysis of the available data, it is important to note that variation from our estimates is not only possible, but in fact, probable. The degree of such variation could be significant and in either direction from our estimates. The sources of this inherent variability are numerous — future economic conditions, court decisions, and legislative actions, for example.

Surety results can be very sensitive to economic conditions. One of the most significant risks to CNA Surety is the risk that a number of the principals holding CNA Surety’s surety bonds might face financial difficulties as a result of an adverse economic environment. If this were to occur, it is likely that more of CNA Surety’s bonds would be called than expected, and hence, this could materially affect CNA Surety’s actual future claim payments. A second risk factor concerns a possible decrease in the government funding for public works projects (e.g., roadways and bridge building). Since a number of CNA Surety’s bonds support principals that specialize in these projects, if these principals are not able to continue with these projects, it is likely that more of these bonds will be called. Finally, another risk factor is the impact that large claims can have on CNA Surety’s unpaid claim estimates. The financial failure of one large principal could result in numerous CNA Surety bonds written for that large principal being called, and hence, a potential large claim representing a significant portion of CNA Surety’s unpaid claim estimates.

In preparing this analysis, we express no opinion on the fairness or value of any proposal by CNA Financial to purchase outstanding stock of CNA Surety. We express no opinion on the value of CNA Surety or its publicly traded securities.

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LIMITED DISTRIBUTION

Milliman’s work has been prepared solely for the internal use of CNA Surety and the Special Committee. No portion of Milliman’s work may be provided to any other party without Milliman’s prior written consent. Even where Milliman consents, Milliman does not intend to benefit or create a legal duty to any third party recipient of its work.

We understand that CNA Surety may include this report in a Form 13-e-3 filing with the Securities and Exchange Commission. We will consent to such inclusion, only if this report is included in its entirety as an Exhibit to the Form 13-e-3 filing, and any reference to Milliman, this report, or our conclusions within the body of the filing has been reviewed and approved by us.

Except as otherwise provided above or in the engagement letter, references to Milliman or its estimates in communications with third parties are not authorized.

In the event Milliman consents to release its work product, it must be provided in its entirety. We recommend that any such party have its own actuary or other qualified professional review the work product to ensure that the party understands the assumptions and uncertainties inherent in our estimates. No third party recipient of Milliman’s work product should rely upon Milliman’s work product.

Any reader of this report must possess a certain level of expertise in areas relevant to this analysis to appreciate the significance of the assumptions and the impact of these assumptions on the illustrated results. The reader should be advised by, among other experts, actuaries or other professionals competent in the area of actuarial projections of the type in this report, so as to properly interpret the projection results.

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In addition, reference to Milliman or Milliman’s name, trademarks or service marks, directly or indirectly in any media release, public announcement or public disclosure, including in any promotional or marketing materials, customer lists, referral lists, websites or business presentations without Milliman’s prior written consent is prohibited.

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BACKGROUND ON MEMBER COMPANIES

The following provides background and a summary of the exposures reviewed for each of the member companies of CNA Surety.

Western Surety Company

WSC is the largest member company of CNA Surety and is licensed in every state. The vast majority of WSC’s net written premium comes from surety bonds, which includes the full spectrum of bond offerings. In our analysis, we reviewed the contract bonds separately from all other bonds. In addition, we have also separately reviewed WSC’s direct written fidelity, notary errors & omissions (E&O), agents E&O and tax preparers E&O business.

We have segregated our analysis of WSC’s claims experience into the following sources of exposure:

• WSC direct written business;

• WSC exposure assumed from CNA Financial (including loss portfolio transfer reserves);

• WSC exposure assumed from SBCA;

• Non-Reviewed sources of exposures; and

• Unallocated loss adjustment expenses (ULAE).

Surety Bonding Company of America

SBCA is licensed in approximately 30 states. The majority of SBCA’s business is notary E&O business and miscellaneous surety bonds, and has been relatively consistent since inception.

Universal Surety of America

USA is licensed in approximately 45 states. Since 2002, the vast majority of USA’s business has been notary bonds, which represents a change from its prior writings. These prior writings included various other types of bonds, including contract bonds.

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SUMMARY OF RESULTS

The following is a comparison of CNA Surety’s carried reserves as of December 31, 2010 to our indicated unpaid loss and LAE as of this evaluation (see also Exhibit 1):

COMPARISON OF MILLIMAN INDICATED TO CNA SURETY CARRIED
LOSS AND LAE, GROSS AND NET OF REINSURANCE
NET OF SALVAGE AND SUBROGATION
AS OF DECEMBER 31, 2010
($000s)

Member Company	CNA Surety Carried		Milliman Indicated		Difference
Gross of Reinsurance
Western Surety Company1	$	381,055	$	333,720	$	47,335
Surety Bonding Company of America		5,610		6,042		(432	)
Universal Surety of America		2,426		2,824		(398	)
Total	$	389,091	$	342,586	$	46,505
Net of Reinsurance
Western Surety Company	$	342,790	$	292,228	$	50,562
Surety Bonding Company of America		867		1,006		(139	)
Universal Surety of America		2,426		2,824		(398	)
Total	$	346,083	$	296,058	$	50,025

¹ Excludes inter-company reinsurance reserves assumed from SBCA. Includes loss portfolio transfer reserves.

As shown in the table above, our indicated net unpaid loss and LAE estimate is approximately $50 million less than the CNA Surety carried net reserves as of December 31, 2010.

In addition to comparing our indications by member company, we have also broken down the net of reinsurance, net of salvage and subrogation difference by accident year as displayed in the following table (see Exhibit 2 for additional detail):

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CNA SURETY CORPORATION
TOTAL REVIEWED LINES OF BUSINESS
NET OF REINSURANCE
NET OF SALVAGE & SUBROGATION

	Unpaid Loss and ALAE
Accident	@ 12/31/10
Year	CNA Surety Carried		Milliman Indicated		Difference
2000 and Prior1	$	10,638	$	11,564	$	(926	)
2001		4,314		3,083		1,231
2002		3,382		1,115		2,267
2003		6,523		3,269		3,253
2004		3,623		2,931		692
2005		8,945		7,127		1,817
2006		10,085		7,818		2,267
2007		11,675		20,242		(8,567	)
2008		37,155		38,339		(1,184	)
2009		78,489		57,662		20,827
2010		96,634		70,030		26,604
Total Loss & ALAE	$	271,462	$	223,180	$	48,281
Large Claims2	$	35,071	$	35,071	$	0
Other3	$	12,223	$	13,077	$	(855	)
ULAE	$	27,328	$	24,728	$	2,600
Total Loss & LAE	$	346,083	$	296,056	$	50,026

1	Gross of Stop Loss Treaty.
2	Includes Consolidated Freightways, Constar and Delphi Automotive.
3	Includes impact of Stop Loss Treaty, WSC Assumed from SBCA, and Non-Reviewed.

The following sections provide additional summarization of the results of our analysis by company.

Discussion of the methodology by company can be found in subsequent segments of our report.

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Western Surety Company

The following is a comparison of our estimate of WSC’s gross and net (of reinsurance), net of anticipated salvage and subrogation, unpaid loss and LAE to the amounts carried by WSC as of December 31, 2010:

WESTERN SURETY COMPANY
COMPARISON OF MILLIMAN INDICATED TO WSC CARRIED UNPAID LOSS AND LAE
NET OF SALVAGE AND SUBROGATION
AS OF DECEMBER 31, 2010
($000s)

Component	WSC Carried		Milliman Indicated		Difference
Gross of Reinsurance
WSC Direct Business	$	202,562	$	176,847	$	25,715
Assumed from CNA Financial		132,290		114,661		17,629
Loss Portfolio Transfer with CNA Financial		10,223		8,988		1,235
Assumed from SBCA		4,744		5,036		(292	)
Other1		8,997		8,997		0
ULAE		26,983		24,227		2,756
Total	$	385,799	$	338,756	$	47,043
Net of Reinsurance
WSC Direct Business	$	181,148	$	155,386	$	25,762
Assumed from CNA Financial		111,045		89,984		21,061
Loss Portfolio Transfer with CNA Financial		10,223		8,988		1,235
Assumed from SBCA		4,744		5,036		(292	)
Other1		8,783		8,783		0
ULAE		26,848		24,051		2,797
Total	$	342,790	$	292,228	$	50,562

¹ Non-reviewed segments where we have accepted WSC carried reserves as being reasonable. Non-reviewed exposures include workers’ compensation, burglary & theft, signing agent E&O, and reinsurance assumed from Federation of Canada, First Insurance Company of Hawaii, DeMontfort, CCC Canada and others.

See Exhibits 3 through 5 for additional detail. Additional discussion by line of business can also be found in the segments entitled WSC Direct Written Business and WSC Exposure Assumed from CNA Financial.

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Surety Bonding Company of America

The following is a comparison of our estimate of SBCA’s gross and net (of reinsurance), net of anticipated salvage and subrogation, unpaid loss and LAE to the amounts carried by SBCA as of December 31, 2010 (also shown on Exhibit 6):

SURETY BONDING COMPANY OF AMERICA
MILLIMAN ESTIMATE OF UNPAID LOSS & LAE
NET OF SALVAGE & SUBROGATION
AS OF DECEMBER 31, 2010
($000s)

Component	SBCA Carried		Milliman Indicated		Difference
Gross of Reinsurance
Surety	$	2,710	$	2,596	$	114
Notary E&O		2,137		2,575		(438	)
Other 1		411		411		0
ULAE		354		461		(107	)
Total	$	5,610	$	6,042		(432	)
Net of Reinsurance
Surety		271	$	260	$	11
Notary E&O		201		245		(44	)
Other 1		41		41		0
ULAE		354		461		(107	)
Total	$	867	$	1,006	$	(139	)

¹ Includes SBCA’s carried loss and ALAE reserves for tax preparers’ E&O and fidelity, for which we have accepted the reserves as being a reasonable estimate of SBCA’s unpaid claim liabilities.

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Universal Surety of America

The following table provides a comparison of our gross and net (of reinsurance), net of anticipated salvage and subrogation unpaid loss and LAE estimates to USA’s carried reserves as of December 31, 2010 (also shown on Exhibit 7) :

UNIVERSAL SURETY OF AMERICA
COMPARISON OF MILLIMAN INDICATED TO USA CARRIED UNPAID LOSS & LAE
NET OF SALVAGE & SUBROGATION
AS OF DECEMBER 31, 2010
($000s)

Component	USA Carried		Milliman Indicated		Difference
Gross of Reinsurance
Surety	$	1,864	$	2,172	$	(308	)
Other1		436		436		0
ULAE		126		216		(90	)
Total	$	2,426	$	2,824	$	(398	)
Net of Reinsurance
Surety	$	1,864	$	2,172	$	(308	)
Other1		436		436		0
ULAE		126		216		(90	)
Total	$	2,426	$	2,824	$	(398	)

¹ Includes USA’s carried loss and ALAE reserves for fidelity, notary E&O, and burglary and theft, for which we have accepted the reserves as being a reasonable estimate of USA’s unpaid claim liabilities.

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DISCUSSION OF CEDED REINSURANCE

This section provides a discussion of the terms of the ceded reinsurance structure for each of the member companies of CNA Surety.

Western Surety Company

The following table provides a summary of WSC’s net per principal retention since the acquisition by CNA Surety:

EFFECTIVE DATE	NET PER PRINCIPAL RETENTION
October 1, 1997 through December 31, 2001	$	5,000,000
January 1, 2002		24,000,000
January 1, 2003		17,250,000
January 1, 2004		14,500,000
January 1, 2005		14,500,000
January 1, 2006		14,500,000
January 1, 2007		14,500,000
January 1, 2008		14,500,000
January 1, 2009		19,500,000
January 1, 2010		19,500,000

WSC’s reinsurance attaches to claims discovered on bonds that are in force during the reinsurance contract period, with options for extended discovery periods. In developing our net of reinsurance estimated unpaid claim liabilities, we have assumed that WSC will continue to renew its excess of loss reinsurance, coupled with the use of the extended discovery option, thereby maintaining the current excess of loss protection. It is our understanding that CNA Surety renewed its excess of loss reinsurance effective January 1, 2011 and that this contract includes a 24 month extended discovery provision. For reference, our total estimate of ceded unpaid loss and ALAE as of December 31, 2010 is $46.5 million. The majority of this would stem from development on known claims or from claims that will become known within the 36 months following the December 31, 2010 evaluation date of our analysis and thus subject to the current net per principal retention. We understand that CNA Surety management and its

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auditors consider the assumption described above to be the appropriate interpretation of its reinsurance contracts and accounting treatment for WSC’s ceded reinsurance.

For a more complete summary of WSC’s reinsurance program, see Exhibit 8.

Surety Bonding Company of America

SBCA participates in WSC’s excess of loss reinsurance program. Given the amount and type of business written by SBCA along with the relatively high retention for the excess of loss program, we do not expect any SBCA losses to be ceded against these excess of loss treaties. In addition to the excess of loss program, SBCA also has a quota share program with WSC, under which SBCA cedes 90% of its premium and losses (including ALAE) to WSC. Hence, all of the $5.0 million of indicated cessions are to WSC. For reference, Exhibit 9 summarizes SBCA’s ceded reinsurance program.

Universal Surety of America

As seen in the summary of results section above, USA’s total indicated, as well as carried ceded reserves are $0. The lack of ceded reserves results from USA’s relatively high retention ($500,000 per principal) under its excess of loss reinsurance program provided by WSC and the type of business written by USA (primarily low limit notary and surety bonds). For reference, Exhibit 10 summarizes USA’s ceded reinsurance program.

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WSC DIRECT WRITTEN BUSINESS

Loss and ALAE were projected to ultimate settlement values using standard actuarial projection methods, including the following:

1)	Loss Development Methods (Paid and Incurred);
2)	Bornhuetter-Ferguson Methods (Paid and Incurred Loss);
3)	Loss Ratio Method;
4)	Paid ALAE Development Method; and
5)	Paid-ALAE-to-Paid-Loss Method.

These methods were applied to the loss and ALAE evaluated as of September 30, 2010. We subsequently relied upon these indications together with WSC’s experience as of December 31, 2010 to produce indications of ultimate loss and ALAE as of this later evaluation. Our estimates of WSC’s direct unpaid claim liabilities are derived from the estimates of ultimate loss and ALAE.

Our analysis involves separate projections for loss and ALAE. These projections were performed using gross experience (prior to reinsurance) and net experience (after reinsurance cessions).

We performed our analysis separately for the following five product lines:

1)	Contract Surety
	The contract surety bonds have been reviewed separately from WSC’s other surety bonds. Beginning in 2004, more of the larger contract bonds that had historically been written on CNA paper are now being written directly by WSC.

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2)	Commercial Surety
	This segment includes various surety bonds, including license and permit bonds, fiduciary and probate bonds, individual public official bonds, notary public official bonds and other miscellaneous surety bonds. This segment was reviewed only on a gross of reinsurance basis given the historical excess of loss cessions (which have been immaterial for the most recent accident years). We did, however, account for the quota share reinsurance cessions.
3)	Fidelity
	This segment includes public employee blanket bonds and other miscellaneous fidelity bonds characterized as “small” by WSC management. This segment is also reviewed only on a gross of reinsurance basis due to the low bond limits, compared to WSC’s excess of loss retention, although an adjustment for the quota share reinsurance treaties applicable to these losses is included.
4)	Notary Errors & Omissions
	This product is marketed as a companion product to the notary public official surety bond. There is no reinsurance applicable to this coverage, so only gross of reinsurance projections are shown.
5)	Tax Preparers’ Errors & Omissions
	This is a claims-made product sold to small tax return preparation firms. There is no reinsurance applicable to this coverage, so only gross of reinsurance projections are shown.

In addition to these five segments, there are certain segments we have not reviewed. Specifically, WSC has carried reserves of approximately $9.0 million on a gross of reinsurance, (net of salvage and subrogation) and approximately $8.8 million on a net of reinsurance, (net of salvage and subrogation) basis, on lines of business that we have not independently reviewed. We have assumed the carried reserves for these segments are reasonable.

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Treatment of Large Claims

Constar

During 2008, CNA Surety became aware of a large contract claim, known as Constar, stemming from accident year 2007. The gross of reinsurance, gross of salvage and subrogation incurred value for this claim as of December 31, 2010 is $63.0 million. The corresponding net of reinsurance, net of salvage and subrogation value is $9.7 million. The majority of this claim is paid, with $141 thousand in case reserve as of December 31, 2010 (net of reinsurance and net salvage and subrogation). We removed this claim from the triangles of incurred and paid loss as of September 30, 2010 and separately included the case reserve for this claim in our projections of unpaid loss and ALAE as of December 31, 2010.

Salvage and Subrogation

We have projected salvage and subrogation separately for the following product lines:

1)	Contract surety;
2)	Commercial surety; and
3)	Fidelity.

It is our understanding that there are no expected salvage and subrogation recoveries corresponding to any of WSC’s other lines of business.

Experience was projected to ultimate values using a development projection method and an ultimate salvage to ultimate loss method, using data evaluated as of September 30, 2010. Projections as of December 31, 2010 were then made using methods analogous to those described above for the loss and ALAE. These projections were performed using both gross and net experience.

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Comparison to Last Year’s Analysis

Our estimates as of December 31, 2010 reflect decreases in ultimate loss and ALAE for years through 2009 of approximately $32.8 million and $42.3 million, net and gross of reinsurance, respectively. Exhibits 11 and 12 show a comparison by line. The results are summarized in the table below:

WSC DIRECT BUSINESS ONLY
MILLIMAN ESTIMATED ULTIMATE LOSS & ALAE¹
NET OF SALVAGE AND SUBROGATION
($000s)

					Increase/
	@ 12/31/10		@ 12/31/09		(Decrease)
Net of Reinsurance
Contract Surety	$	201,706	$	236,600	$	(34,894	)
Commercial Surety		209,322		207,700		1,622
Fidelity		28,661		28,398		263
Notary E&O		7,804		7,440		364
Tax Preparers E&O		7,949		8,148		(198	)
Total Net	$	455,439	$	488,284	$	(32,845	)
Gross of Reinsurance
Contract Surety	$	244,180	$	288,317	$	(44,137	)
Commercial Surety		214,628		213,202		1,426
Fidelity		29,393		29,148		245
Notary E&O		7,804		7,440		364
Tax Preparers E&O		7,949		8,148		(198	)
Total Gross	$	503,951	$	546,253	$	(42,302	)

¹ Accident/report years 2009 and prior.

As shown in the table above, the vast majority of the change in our estimated ultimate loss and ALAE relates to the contract surety segment. This segment has experienced better than expected loss and ALAE development the past several years, particularly in light of the broad economic slowdown that we anticipated would increase WSC’s contract loss ratio, all else equal. While we did notice a modest increase in the commercial surety loss activity, the contract surety segment continued to exhibit favorable experience.

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Approach to Analysis of ULAE

The estimates described above provide for unpaid loss and ALAE. Our derivation of indicated unpaid ULAE involves estimating the ratio of paid ULAE to paid loss and ALAE. This ratio is equal to:

Calendar Year Paid ULAE

Divided By

Calendar Year Paid Loss Plus Calendar Year Paid ALAE

This selected ratio was developed using gross of reinsurance, gross of salvage and subrogation loss and ALAE payments and thus is applied to our indicated IBNR and 50% of the case reserves on a gross of reinsurance, gross of salvage and subrogation basis, as of December 31, 2010. This commonly used actuarial methodology assumes that half of the ULAE required to settle a claim is expended when the claim is first reported, with the other half being expended when the claim is closed. In estimating the ULAE ratio, we derived calendar year paid ULAE from successive Schedules P of WSC’s Annual Statements. We have not been provided by WSC with its 2010 paid ULAE. However, we expect the impact of such information on our analysis would be minimal.

Because these calculations are based on direct plus assumed data from Schedule P, the same ratio is utilized for the direct business as well as the assumed. Given the similarities in the business written, we believe this is reasonable.

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WSC EXPOSURE ASSUMED FROM CNA FINANCIAL

Our estimates for the contract and commercial exposures are derived largely from the historical loss and ALAE development patterns. For each source of business, we estimated the following:

• Gross ultimate loss and ALAE, gross of salvage and subrogation;

• Net (of reinsurance) ultimate loss and ALAE, gross of salvage and subrogation;

• Gross ultimate salvage and subrogation; and

• Net ultimate salvage and subrogation.

Our indications were developed using generally accepted development methods, including:

1) Loss Development Methods (Paid and Incurred);

2) Bornhuetter-Ferguson Methods (Incurred Only);

3) Hindsight Outstanding Method;

4) Loss Ratio Method;

5) Paid ALAE Development Method; and

6) Paid-ALAE-to-Paid-Loss Method.

Loss Portfolio Transfer

Effective October 1, 1997, WSC assumed, via a loss portfolio transfer, certain exposures that were written by CNA Financial subsidiary companies. This assumption is accounted for as the write-in liability “Retroactive Reinsurance Reserve Assumed” on WSC’s statutory financial statements. We have estimated the unpaid loss and LAE associated with accident dates prior to October 1, 1997 (and hence part of the loss portfolio transfer) consistent with the remainder of our analysis.

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Assumed International Business

WSC had assumed, on a quota share treaty basis, 50% of a book of international surety business of CNA Reinsurance Company, Limited (London). It is our understanding that this treaty has been commuted, and hence, WSC no longer has any unpaid claim liabilities related to this exposure. Since this business was included under the stop loss reinsurance treaty, we have included the ultimate commuted values in our evaluation of the stop loss reinsurance cessions (discussed further below).

Stop-Loss Treaty

For October 1, 1997 through December 31, 2000 accident dates, CNA Surety entered into a stop-loss reinsurance treaty with CNA Financial, whereby CNA Surety’s net retained losses are capped at a 24% loss and LAE ratio by accident year. All loss and LAE above the 24% loss and LAE ratio is ceded to CNA Financial.

The stop-loss reinsurance treaty covered the international surety exposure that was written at this time (in addition to the contract and commercial surety). In order to estimate WSC’s cessions under the stop-loss treaty, we have used the following ultimate loss and ALAE values for the international surety exposure, which are WSC’s allocation of the commuted values by underwriting year:

UNDERWRITING	ULTIMATE LOSS AND ALAE
YEAR	APPLIED AGAINST STOP-LOSS TREATY
1997	$	8,506,900
1998		6,240,945
1999		5,690,617
2000		6,591,578

Treatment of Large Claims

CNA Surety has incurred loss on several large claims that are generally unrepresentative of its prospective claims experience. We believe we can derive better estimates of the overall indicated reserves by excluding these claims from the historical development and including them at their current case reserve value. However given that several of these claims have occurred and that they are typically unknown for some time after the bond is written, we have taken into account the likelihood that CNA

Milliman

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Surety may have incurred a large claim as of the current evaluation that remains unreported. We have done so in the selection of our methods and the method parameters.

Enron Corporation (Commercial Surety)

CNA Surety has resolved its exposure to the December 14, 2001 Enron bankruptcy. The gross and net paid loss and ALAE were $44.6 million and $7.8 million, respectively. Because of the unique nature of this claim, we excluded the Enron claim from the development methods in our analysis.

Superior National (Commercial Surety)

CNA Surety has also resolved its exposure to the Superior National claim from accident year 1999. We have excluded this claim from our development methods consistent with our treatment of other large claims. The gross and net of reinsurance loss payments, net of salvage and subrogation for this claim are $54.4 million and $33.5 million, respectively. This claim resulted in the 1999 accident year exceeding the aggregate stop loss limit under the stop loss treaty, so that effectively only $5.4 million of this claim was retained net of the cessions on this treaty.

Consolidated Freightways (Commercial Surety)

CNA Surety’s incurred loss estimate for its exposure to the Consolidated Freightways (CF) bankruptcy has remained at approximately $61.3 million since December 2003. This estimate continues to reflect CNA Surety’s maximum exposure per the bond limits provided to CF. Finally, in addition to CNA Surety’s bonds, it is our understanding that CF also secured a $55 million letter of credit from G.E. Capital. Based on discussions with CNA Surety, it is our understanding that the liquidator of CF has assumed that CNA Surety’s bonds and the GE letter of credit will apply simultaneously and proportionately. In our analysis, we excluded this claim from our development methods and have used a gross of reinsurance, net of salvage and subrogation ultimate value for this claim equal to CNA Surety’s incurred loss estimate of $54.8 million. CNA Surety has commuted its reinsurance that was applicable to this claim and it is our

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understanding that its net exposure (net of reinsurance, net of salvage and subrogation) for this claim is $29.3 million.

Delphi Automotive (Commercial Surety)

CNA Surety has incurred a loss of approximately $10.8 million on a bond issued to Delphi Automotive of which approximately $0.7 million has been paid. We understand that this incurred loss amount is equal to the limit of the bond and that all other bonds issued to Delphi have been released. The bond is fully collateralized so that the net of salvage exposure is minimal. Because the collateral was drawn down prior to the loss payment, this claim produced a negative payment (which is offset by an equally positive case reserve) in the data provided to us.

Dick Corporation (Contract Surety)

It is our understanding that CNA Surety’s exposure to the Dick Corporation was commuted as of June 30, 2009. Thus, CNA Surety’s unpaid claim liability as of December 31, 2010 for this exposure is $0. For purposes of our analysis, we have adjusted the September 30, 2010 paid and incurred loss data by $110 million and $60 million on a gross and net basis, respectively, which represent CNA Surety’s pre-commutation gross and net exposure for this claim.

Milliman

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Comparison to Last Year’s Analysis

The current estimates reflect a decrease in ultimate loss and ALAE for accident years through 2009 of approximately $35.4 million and $30.1 million, gross and net of reinsurance, respectively. Exhibits 13 and 14 show a comparison by line. The results are summarized in the table below:

WSC ASSUMED BUSINESS
MILLIMAN ESTIMATED ULTIMATE LOSS & ALAE
NET OF SALVAGE AND SUBROGATION
($000s)

	@ 12/31/10		@ 12/31/09		Increase/ (Decrease)
Prior to the Stop Loss, Net of the XOL1
Contract Surety	$	669,038	$	693,286	$	(24,248	)
Commercial Surety		191,164		197,014		(5,850	)
Total Net	$	860,202	$	890,300	$	(30,098	)
Gross of Reinsurance2
Contract Surety	$	355,189	$	387,188	$	(31,999	)
Commercial Surety		111,244		114,669		(3,425	)
Total	$	466,433	$	501,857	$	(35,424	)

1	Accident years 2009 and prior.
2	Accident years 1997 through 2009 (years included in loss portfolio transfer are projected net of reinsurance only).

As with the WSC direct business, the majority of the decrease in ultimate loss and ALAE shown above stemmed from the contract surety business. The assumed contract surety business, like the direct written contract business, exhibited better than expected experience, particularly in light of the broad economic slowdown that was expected to increase loss ratios.

Approach to Analysis of ULAE

As discussed above in the section entitled WSC Direct Written Business, our analysis of ULAE is based on a paid-to-paid approach. This approach assumes the same ratio of paid ULAE to paid loss and ALAE for the assumed business as for the direct.

Milliman

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Discussion of Data Issues

Finally, as has been consistent with the recent past, we note that for the 1997 through 2009 years, the net data provided to us combines loss, ALAE and subrogation recoveries. We would prefer that this data be separated, as it is for the 1996 and prior years; however, we understand the data is not presently available in this format. Our estimates will have more inherent variability as a result of this data limitation.

Milliman

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BUSINESS WRITTEN BY SBCA

SBCA writes various classes of business, including small surety bonds, notary E&O, tax preparers’ E&O and fidelity. We performed analyses of the two largest lines of business written by SBCA. These are the surety and notary E&O product lines. The surety line of business includes various contract surety bonds, license and permit bonds, fiduciary and probate bonds, notary bonds and other miscellaneous surety bonds described by SBCA management as being “low risk.”

The types of risks underwritten by SBCA are similar to those underwritten by WSC. Thus, all else equal, we would expect similar loss experience for these two companies. As a result, we have supplemented SBCA’s loss development pattern with those of WSC in projecting ultimate losses.

Our analysis was performed using SBCA’s claims experience through September 30, 2010. Consistent with our analyses for the other member companies of CNA Surety, we then adjusted our projections of ultimate loss and ALAE as of December 31, 2010 to reflect any differences between the actual and expected loss and ALAE as of the two evaluations. Loss and ALAE were projected separately to ultimate settlement values using generally accepted actuarial projection methods, including the following:

1) Loss Development Methods (Paid and Incurred);

2) Loss Ratio Method;

3) Bornhuetter-Ferguson Method (Incurred Loss and Paid ALAE Only);

4) Paid ALAE Development Method; and

5) Paid-ALAE-to-Paid-Loss Method.

The data underlying our analysis is gross of salvage and subrogation recoveries. Given the relatively immaterial amount of salvage and subrogation activity on this business (inception to date recoveries on a gross basis of approximately $296,000), we have not developed unrecovered salvage and subrogation. Rather, we have subtracted from our gross of salvage and subrogation ultimate loss and ALAE estimates

Milliman

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the salvage and subrogation that SBCA has recovered to date. Thus, our estimates of SBCA’s unpaid loss and LAE are net of salvage and subrogation recoveries, but not salvage and subrogation recoverable. Based on the salvage and subrogation recoveries to date, we believe SBCA’s salvage and subrogation recoverables are not material to the reserves of CNA Surety.

In addition to the two reviewed segments, there are certain segments that are too small for actuarial analysis. SBCA writes a small amount of fidelity and tax preparers’ E&O. The carried net loss and ALAE reserves for these segments totaled $41,000 ($411,000 on a gross basis) as of December 31, 2010. We have accepted SBCA’s carried reserves as being a reasonable estimate of its unpaid claim liability for this exposure.

In order to estimate the unpaid ULAE for SBCA, we have relied on a methodology analogous to that employed for WSC. This represents a change from our prior analysis for SBCA. Previously, we analyzed SBCA’s ULAE using an external industry-based ratio. We estimate the effect of this change on the indicated unpaid ULAE as an increase of approximately $0.2 million.

Finally, Exhibits 15 and 16 display the change in our estimated ultimate loss and ALAE by accident year since our previous analysis as of December 31, 2009.

Milliman

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BUSINESS WRITTEN BY USA

Our analysis was performed using USA’s gross claims experience through September 30, 2010. We have assumed, based on USA’s historical losses and the types of bonds that USA writes that any ceded unpaid loss, ALAE or salvage would be immaterial. Consistent with our analyses for the other member companies of CNA Surety, we then adjusted our projections of ultimate loss and ALAE as of December 31, 2010 to reflect any differences between the actual and expected loss and ALAE as of the two evaluations. Loss and ALAE were projected separately to ultimate settlement values using generally accepted actuarial projection methods, including the following:

1) Loss Development Method (Paid and Incurred);

2) Bornhuetter-Ferguson Method (Incurred Loss Only);

3) Paid ALAE Development Method; and

4) Paid-ALAE-to-Paid-Loss Method.

We performed our analysis on the surety product line, which includes various contract surety bonds (for accident years 2001 and prior), license and permit bonds, fiduciary and probate bonds, individual public official bonds, notary public official bonds and other miscellaneous surety bonds described by USA management as being “low risk.” USA’s earned premium has been decreasing over the past several years as other members of CNA Surety have written more of USA’s historical contract surety business. It is our understanding that most of USA’s historical contract surety business, which has produced more volatile losses in the past for USA, has been moved off of USA paper and, since 2002, most of USA’s exposure stems from its notary bonds business. As a result, we have referenced the WSC commercial surety development factors in estimating the 2002 and subsequent development.

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In order to estimate USA’s unpaid ULAE, we applied a methodology analogous to that used for WSC and SBCA. Consistent with SBCA, this represents a change in our methodology from our previous analysis. We estimate the effect of this change on the indicated unpaid ULAE as an increase of approximately $0.1 million.

In addition to the surety segment, there are certain segments that are too small for actuarial analysis. USA writes a small amount of fidelity, notary E&O and burglary and theft. The carried net loss and ALAE reserves for these segments total $436,000 as of December 31, 2010. We have accepted USA’s carried reserves as being a reasonable estimate of its unpaid claim liabilities for these segments.

Finally, Exhibits 17 and 18 display the change in our estimated ultimate loss and ALAE by accident year since our previous analysis as of December 31, 2009.

Milliman

-30-

CLOSING

We appreciate the opportunity to be of service to the Special Committee. Please call with any comments or questions.

Respectfully submitted,

Chad C. Karls, FCAS, MAAA
Principal and Consulting Actuary

CCK/bas

Encl.

January 21, 2011

Milliman

Attachment A
(Page 1 of 4)

CNA SURETY CORPORATION

ESTIMATE OF UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES
AS OF DECEMBER 31, 2010

TABLE OF CONTENTS

WESTERN SURETY COMPANY DIRECT BUSINESS
			9/30/10	12/31/10
Product	Component	Reinsurance	Exhibit Section	Exhibit Section
Contract Surety	Loss & ALAE	Gross	A	K
Contract Surety	Sal/Sub	Gross	B	K
Contract Surety	Loss & ALAE	Net	C	L
Contract Surety	Sal/Sub	Net	D	L
Commercial Surety	Loss & ALAE	Gross & Net	E	M
Commercial Surety	Sal/Sub	Gross & Net	F	M
Fidelity	Loss & ALAE	Gross & Net	G	N
Fidelity	Sal/Sub	Gross & Net	H	N
Notary E&O	Loss & ALAE	Gross & Net	I	O
Tax Preparers E&O	Loss & ALAE	Gross & Net	J	P
Total All Lines	ULAE	N/A	N/A	Q

Milliman

Attachment A
(Page 2 of 4)

CNA SURETY CORPORATION

ESTIMATE OF UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES
AS OF DECEMBER 31, 2010

TABLE OF CONTENTS

WESTERN SURETY COMPANY BUSINESS ASSUMED FROM CNA SURETY
				9/30/10	12/31/10
Product	Component	Years	Reinsurance	Exhibit Section	Exhibit Section
Contract	Claims	1987-2010	N/A	A	N/A
Contract1	Loss	1987-2010	Gross	B	M
Contract	ALAE	1987-2010	Gross	B	M
Contract	Sal/Sub	1987-2010	Gross	C	M
Commercial	Claims	1987-2010	N/A	D	N/A
Commercial1	Loss	1987-2010	Gross	E	N
Commercial	ALAE	1987-2010	Gross	E	N
Commercial	Sal/Sub	1987-2010	Gross	F	N
Contract1	Loss	1987-1997	Net	G	O
Contract	ALAE	1987-1997	Net	G	O
Contract	Sal/Sub	1987-1997	Net	H	O
Commercial1	Loss	1987-1997	Net	I	P
Commercial	ALAE	1987-1997	Net	I	P
Commercial	Sal/Sub	1987-1997	Net	J	P
Summary2	Loss & ALAE	1987-1997	Net	N/A	Q
Contract2	Loss & ALAE	1997-2010	Net of XOL	K	R
Commercial2	Loss & ALAE	1997-2010	Net of XOL	L	S
Contract/Commercial	ULAE	1987-2010	N/A	N/A	T
Stop Loss	Loss & LAE	1997-2010	Stop Loss	N/A	U

1	Losses are gross of salvage and subrogation.
2	Losses are net of salvage and subrogation.

Milliman

Attachment A
(Page 3 of 4)

CNA SURETY CORPORATION

SURETY BONDING COMPANY OF AMERICA
ESTIMATE OF UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES
AS OF DECEMBER 31, 2010

TABLE OF CONTENTS

SURETY BONDING COMPANY OF AMERICA
			9/30/10	12/31/10
Product	Component	Reinsurance	Exhibit Section	Exhibit Section
Surety	Loss & ALAE	Gross	A	E
Notary E&O	Loss & ALAE	Gross	B	F
Surety	Loss & ALAE	Net	C	G
Notary E&O	Loss & ALAE	Net	D	H
Summary	Loss & ALAE	Gross, Net & Ceded	N/A	I
Total All Lines	ULAE	N/A	N/A	J

Milliman

Attachment A
(Page 4 of 4)

CNA SURETY CORPORATION

ESTIMATE OF UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES
AS OF DECEMBER 31, 2010

TABLE OF CONTENTS

UNIVERSAL SURETY OF AMERICA
			9/30/10	12/31/10
Product	Component	Reinsurance	Exhibit Section	Exhibit Section
Surety	Loss & ALAE	Gross & Net	A	B
Total All Lines	ULAE	N/A	N/A	C

Milliman

Exhibit 1

CNA SURETY CORPORATION

NET OF SALVAGE & SUBROGATION
AS OF DECEMBER 31, 2010
($000s)

	CNA Surety			Milliman
Member Company	Carried			Indicated			Difference
	Unpaid Loss & LAE, Gross of Reinsurance
Western Surety Company		381,055	*		333,720	*		47,335
Surety Bonding Company of America		5,610			6,042			(432	)
Universal Surety of America		2,426			2,824			(398	)
Total		389,091			342,586			46,505
	Unpaid Loss & LAE, Net of Reinsurance
Western Surety Company		342,790			292,228			50,562
Surety Bonding Company of America		867			1,006			(139	)
Universal Surety of America		2,426			2,824			(398	)
Total		346,083			296,058			50,025

* Excludes inter-company reinsurance reserves assumed from SBCA

Milliman

Exhibit 2

CNA SURETY CORPORATION
NET OF CEDED REINSURANCE, NET OF THE QUOTA SHARE TREATIES
NET OF SALVAGE & SUBROGATION

Summary of Ultimate Loss & ALAE ($000s)

	Reviewed Lines of Business, Gross of the Stop Loss Treaty
					Carried			Milliman
	Case		Carried		Unpaid			Unpaid
Accident	Outstanding		IBNR		Loss & ALAE			Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10			@12/31/10			Difference
2000 & Prior		8,523		2,115		10,638			11,564			(926	)
2001		2,143		2,171		4,314			3,083			1,231
2002		549		2,833		3,382			1,115			2,267
2003		1,243		5,279		6,523			3,269			3,253
2004		1,487		2,136		3,623			2,931			692
2005		4,971		3,974		8,945			7,127			1,817
2006		5,696		4,389		10,085			7,818			2,267
2007		1,910		9,766		11,675			20,242			(8,567	)
2008		7,627		29,528		37,155			38,339			(1,184	)
2009		19,003		59,486		78,489			57,662			20,827
2010		4,630		92,004		96,634			70,030			26,604
Total Loss & ALAE		57,781		213,681		271,462			223,180			48,281
Consolidated Freightways		24,815		0		24,815			24,815			0
Constar		141		0		141			141			0
Delphi		10,115		0		10,115			10,115			0
WSC Assumed from SBCA						4,744			5,036			(292	)
Stop Loss Treaty Cessions						(1,781	)		(1,219	)		(562	)
Non-Reviewed-WSC						8,783			8,783			(0	)
Non-Reviewed-SBCA						41			41			0
Non-Reviewed-USA						436			436			0
Total ULAE						27,328			24,728			2,600
Total Loss & LAE		92,852		213,681		346,083			296,056			50,026

Milliman

Exhibit 3

WESTERN SURETY COMPANY

COMPARISON OF GROSS UNPAID LOSS & LAE AT DECEMBER 31, 2010
NET OF SALVAGE & SUBROGATION
($000s)

		WSC		Milliman
Segment	Source of Business	Carried		Indicated		Difference
Direct	Contract Surety (Excluding Constar)		128,411		119,567		8,844
Direct	Constar		2,822		2,822		0
Direct	Commercial Surety		64,596		47,637		16,959
Direct	Fidelity		4,736		4,206		530
Direct	Notary E&O		1,402		2,138		(736	)
Direct	Tax Preparers E&O		595		477		118
Direct	Subtotal		202,562		176,847		25,715
Assumed from CNA	Commercial Surety (Excluding Large Claims)		N/A		9,640		N/A
Assumed from CNA	Consolidated Freightways		25,597		25,597		0
Assumed from CNA	Delphi Automotive		10,115		10,115		0
Assumed from CNA	Contract Surety		N/A		69,308		N/A
Assumed from CNA	Subtotal		132,290		114,661		17,629
Loss Portfolio Transfer	Loss Portfolio Transfer from CNA1		10,223		8,988		1,235
Assumed from SBCA	All Lines2		4,744		5,036		(292	)
Non-Reviewed	Other Non-Reviewed Written by WSC3		8,997		8,997		0
ULAE	ULAE4		26,983		24,227		2,756
Total			385,799		338,756		47,043

1	From WSC Assumed Business Exhibit Q1 from Technical Appendix.
2	From SBCA ceded summary (Exhibit I3 of SBCA segment of Technical Appendix).
3	Includes Direct Written Signing Agent E&O, Agent Broker E&O, Workers’ Compensation and Burglary & Theft Business and Reinsurance Assumed from Federation of Canada, First Insurance Company of Hawaii, DeMontfort, Canadian Commercial Corporation and Others.
4	From Exhibit 5

Milliman

Exhibit 4

WESTERN SURETY COMPANY

COMPARISON OF NET UNPAID LOSS & LAE AT DECEMBER 31, 2010
NET OF SALVAGE & SUBROGATION
($000s)

		WSC		Milliman
Segment	Source of Business	Carried		Indicated			Difference
Direct	Contract Surety (Excluding Constar)		111,021		100,843			10,178
Direct	Constar		141		141			0
Direct	Commercial Surety		63,270		47,581			15,689
Direct	Fidelity		4,718		4,206			512
Direct	Notary E&O		1,402		2,138			(736	)
Direct	Tax Preparers E&O		595		477			118
Direct	Subtotal		181,148		155,386			25,762
Assumed from CNA	Commercial Surety (Excluding Large Claims)		N/A		6,560			N/A
Assumed from CNA	Consolidated Freightways		24,815		24,815			0
Assumed from CNA	Delphi Automotive		10,115		10,115			0
Assumed from CNA	Contract Surety		N/A		49,713			N/A
Assumed from CNA	Effect of Stop Loss Treaty with CNA1		N/A		(1,219	)		N/A
Assumed from CNA	Subtotal		111,045		89,984			21,061
Loss Portfolio Transfer	Loss Portfolio Transfer from CNA2		10,223		8,988			1,235
Assumed from SBCA	All Lines3		4,744		5,036			(292	)
Non-Reviewed	Other Non-Reviewed Written by WSC4		8,783		8,783			0
ULAE	ULAE5		26,848		24,051			2,797
Total			342,790		292,228			50,562

1	Effect on loss and ALAE only; see Stop Loss section in Assumed Business segment.
2	From WSC Assumed Business Exhibit Q1 from Technical Appendix.
3	From SBCA ceded summary (Exhibit I3 of SBCA segment of Technical Appendix).
4	Includes Direct Written Signing Agent E&O, Agent Broker E&O, Workers’ Compensation and Burglary & Theft Business and Reinsurance Assumed from Federation of Canada, First Insurance Company of Hawaii, DeMontfort, Canadian Commercial Corporation and Others.
5	From Exhibit 5

Milliman

Exhibit 5

WESTERN SURETY COMPANY — DIRECT & ASSUMED BUSINESS

SUMMARY OF UNPAID ULAE ($000s)
EVALUATED AS OF DECEMBER 31, 2010

	Indicated
	Unpaid
	ULAE
Segment	@12/31/10
WSC Direct (Reviewed Lines Only)*		17,357
Loss Portfolio Transfer**		446
WSC Assumed from CNA Surety***		5,960
Total Reviewed		23,763
ULAE on Non-Reviewed Lines		464
Indicated Gross Unpaid ULAE		24,227
Effect of Stop Loss on Unpaid ULAE****		(176	)
Indicated Net Unpaid ULAE		24,051

*	See WSC Direct Business Exhibit Q2
**	See WSC Assumed Business Exhibit T2
***	See WSC Assumed Business Exhibit T3
****	See WSC Assumed Business Exhibit U2

Milliman

Exhibit 6

SURETY BONDING COMPANY OF AMERICA

UNPAID LOSS & LAE
NET OF SALVAGE & SUBROGATION
AS OF DECEMBER 31, 2010
($000s)

	SBCA		Milliman
Component	Carried		Indicated		Difference
	Unpaid Loss & LAE, Gross of Reinsurance
Surety		2,710		2,596		114
Notary E&O		2,137		2,575		(438	)
All Other*		411		411		0
ULAE		354		461		(107	)
Total		5,610		6,042		(432	)
	Unpaid Loss & LAE, Net of Reinsurance
Surety		271		260		11
Notary E&O		201		245		(44	)
All Other*		41		41		0
ULAE		354		461		(107	)
Total		867		1,006		(139	)

* Includes SBCA’s carried reserves for Tax Preparers’ E&O and Fidelity, for which we have accepted the reserves as being a reasonable estimate of SBCA’s unpaid claim liabilities.

Milliman

Exhibit 7

UNIVERSAL SURETY OF AMERICA

UNPAID LOSS & LAE
NET OF SALVAGE & SUBROGATION
AS OF DECEMBER 31, 2010
($000s)

	SBCA		Milliman
Component	Carried		Indicated		Difference
	Unpaid Loss & LAE, Gross of Reinsurance
Surety		1,864		2,172		(308	)
All Other*		436		436		0
ULAE		126		216		(90	)
Total		2,426		2,824		(398	)
	Unpaid Loss & LAE, Net of Reinsurance
Surety		1,864		2,172		(308	)
All Other*		436		436		0
ULAE		126		216		(90	)
Total		2,426		2,824		(398	)

* Includes USA’s carried reserves for Fidelity, Notary and Burglary & Theft for which we have accepted the reserves as being a reasonable estimate of USA’s unpaid claim liabilities.

Milliman

Exhibit 8

Western Surety Company

Summary of Ceded Reinsurance Program

Contract Period		Contract Name	Business Covered	Percent Placed			Reinsurers
First Excess Policy
Effective 10-1-97	Expiration 12-31-01	Excess of Loss Contract $55M Excess of $5M	All Direct & Assumed Bonds		100	%	Various Reinsurers
Effective 01-01-02	Expiration 12-31-02	Excess of Loss Contract $40M Excess of $20M	All Direct & Assumed Bonds		80	%	Various Reinsurers
Effective 01-01-02	Expiration 12-31-02	Quota Share of $40M Excess of $20M	All Direct & Assumed Bonds		10	%	Continental Casualty
Effective 01-01-03	Expiration 12-31-03	Excess of Loss Contract $45M Excess of $15M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Effective 01-01-04	Expiration 12-31-04	Excess of Loss Contract $90M Excess of $10M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Effective 01-01-05	Expiration 12-31-05	Excess of Loss Contract $90M Excess of $10M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Effective 01-01-06	Expiration 12-31-06	Excess of Loss Contract $90M Excess of $10M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Effective 01-01-07	Expiration 12-31-07	Excess of Loss Contract $90M Excess of $10M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Effective 01-01-08	Expiration 12-31-08	Excess of Loss Contract $90M Excess of $10M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Effective 01-01-09	Expiration 12-31-09	Excess of Loss Contract $90M Excess of $15M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Effective 01-01-10	Expiration 12-31-10	Excess of Loss Contract $90M Excess of $15M	All Direct & Assumed Bonds		95	%	Various Reinsurers
Second Excess Policy
Effective 10-01-97	Expiration 09-03-02	Excess of Loss Contract $75M Excess of $60M	All Direct & Assumed Bonds		100	%	Continental Casualty
Effective 10-01-97	Expiration 09-03-02	Excess of Loss Contract Excess of $135M	All Direct & Assumed Bonds		100	%	Continental Casualty
Effective 10-01-02	Expiration 12-31-03	Excess of Loss Contract $40M Excess of $60M	All Direct & Assumed Bonds		95	%	Continental Casualty
Effective 10-01-02	Expiration 12-31-02	Quota Share of $20M Excess of $60M	All Direct & Assumed Bonds		5	%	Continental Casualty
Effective 10-01-02	Expiration 12-31-03	Excess of Loss Contract $40M Excess of $100M	All Direct & Assumed Bonds		100	%	Continental Casualty
Effective 10-01-03	Expiration 12-31-03	Excess of Loss Contract $3M Excess of $12M	All Direct & Assumed Bonds		100	%	Continental Casualty
Effective 01-01-04	Expiration 12-31-04	Excess of Loss Contract $50M Excess of $100M	All Direct & Assumed Bonds		100	%	Continental Casualty
Effective 01-01-05	Expiration 12-31-05	Excess of Loss Contract $50M Excess of $100M	All Direct & Assumed Bonds		100	%	Continental Casualty
Other Programs
Effective 10-01-02	Expiration 12-31-04	Dick Corp. Bonds, Excess of 10% of WSC Surplus	Dick Corp		100	%	Continental Casualty
Effective 01-01-04	Expiration 12-31-04	Excess of Loss Contract $40M Excess of $60M (Dick Corp.)	Dick Corp		100	%	Continental Casualty
Effective 01-01-05	Expiration 12-31-07	Excess of Loss Contract Excess of $60M (Dick Corp.)	Dick Corp		100	%	Continental Casualty
Effective 09-01-06	Continuous	Surety Quota Share Reinsurance Agreement	Certain Specific Surety Bonds		100	%	Endurance Re/American Re
Effective 10-01-97	Expiration 12-31-00	Aggregate Stop Loss Treaty (24% Loss & LAE Ratio)	All Assumed Business		100	%	Continental Casualty
Effective 01-01-02	Expiration 12-31-04	Small Commercial Quota Share	Direct Fidelity, Surety, Burglarly & Theft		4	%	American Re
Effective 01-01-02	Expiration 12-31-04	Small Commercial Quota Share	Direct Fidelity, Surety, Burglarly & Theft		2	%	XL Re
Effective 10-01-94	Expiration 10-01-99	Quota Share Treaty Agent E&O Liability	Agent E&O Program	80% to 90%			Transatlantic Re
Effective 10-01-97	Continuous	SBA (Plan B) Preferred Surety Bond Guarantee	Certain Direct Contract Bonds		70	%	Small Business Admin.
Effective 01-01-95	Expiration 01-01-00	Quota Share Treaty Contract Surety	Certain Direct Contract Bonds		100	%	Universal Surety of America
Effective Various	Expiration Various	International Facultative	International Surety		100	%	Various
Effective 09-01-06	Continuous	Large Bond Quota Share Reinsurance Agreement	Surety Business		100	%	Various

Milliman

Exhibit 9

Surety Bonding Company of America

Summary of Ceded Reinsurance Program

Contract Period		Contract Name	Business Covered	Percent Placed			Reinsurers
First Excess Policy
Effective 10-1-97	Expiration 12-31-01	Excess of Loss Contract $55M Excess of $5M	All Business		100	%	Various Reinsurers
Effective 01-01-02	Expiration 12-31-02	Excess of Loss Contract $40M Excess of $20M	All Business		80	%	Various Reinsurers
Effective 01-01-02	Expiration 12-31-02	Quota Share of $40M Excess of $20M	All Business		10	%	Continental Casualty
Effective 01-01-03	Expiration 12-31-03	Excess of Loss Contract $45M Excess of $15M	All Business		95	%	Various Reinsurers
Effective 01-01-04	Expiration 12-31-04	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-05	Expiration 12-31-05	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-06	Expiration 12-31-06	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-07	Expiration 12-31-07	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-08	Expiration 12-31-08	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-09	Expiration 12-31-09	Excess of Loss Contract $90M Excess of $15M	All Business		95	%	Various Reinsurers
Effective 01-01-10	Expiration 12-31-10	Excess of Loss Contract $90M Excess of $15M	All Business		95	%	Various Reinsurers
Second Excess Policy
Effective 10-01-97	Expiration 09-03-02	Excess of Loss Contract $75M Excess of $60M	All Business		100	%	Continental Casualty
Effective 10-01-97	Expiration 09-03-02	Excess of Loss Contract Excess of $135M	All Business		100	%	Continental Casualty
Effective 10-01-02	Expiration 12-31-03	Excess of Loss Contract $40M Excess of $60M	All Business		95	%	Continental Casualty
Effective 10-01-02	Expiration 12-31-03	Excess of Loss Contract $40M Excess of $100M	All Business		100	%	Continental Casualty
Effective 10-01-03	Expiration 12-31-03	Excess of Loss Contract $3M Excess of $12M	All Business		100	%	Continental Casualty
Effective 01-01-04	Expiration 12-31-04	Excess of Loss Contract $50M Excess of $100M	All Business		100	%	Continental Casualty
Effective 01-01-05	Expiration 12-31-05	Excess of Loss Contract $50M Excess of $100M	All Business		100	%	Continental Casualty
Other Programs
Effective 10-01-97	Expiration 12-31-99	Contract Surety Bond Quota Share	All Direct Contract Surety Bonds		100	%	Universal Surety of America
Effective 09-01-93	Continuous	Quota Share (All Business)	All Business		90	%	Western Surety Company

Milliman

Exhibit 10

Universal Surety of America

Summary of Ceded Reinsurance Program

Contract Period		Contract Name	Business Covered	Percent Placed			Reinsurers
First Excess Policy
Effective 10-1-97	Expiration 12-31-01	Excess of Loss Contract $55M Excess of $5M	All Business		100	%	Various Reinsurers
Effective 01-01-02	Expiration 12-31-02	Excess of Loss Contract $40M Excess of $20M	All Business		80	%	Various Reinsurers
Effective 01-01-02	Expiration 12-31-02	Quota Share of $40M Excess of $20M	All Business		10	%	Continental Casualty
Effective 01-01-03	Expiration 12-31-03	Excess of Loss Contract $45M Excess of $15M	All Business		95	%	Various Reinsurers
Effective 01-01-04	Expiration 12-31-04	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-05	Expiration 12-31-05	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-06	Expiration 12-31-06	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-07	Expiration 12-31-07	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-08	Expiration 12-31-08	Excess of Loss Contract $90M Excess of $10M	All Business		95	%	Various Reinsurers
Effective 01-01-09	Expiration 12-31-09	Excess of Loss Contract $90M Excess of $15M	All Business		95	%	Various Reinsurers
Effective 01-01-10	Expiration 12-31-10	Excess of Loss Contract $90M Excess of $15M	All Business		95	%	Various Reinsurers
Second Excess Policy
Effective 10-01-97	Expiration 09-03-02	Excess of Loss Contract $75M Excess of $60M	All Business		100	%	Continental Casualty
Effective 10-01-97	Expiration 09-03-02	Excess of Loss Contract Excess of $135M	All Business		100	%	Continental Casualty
Effective 10-01-02	Expiration 12-31-03	Excess of Loss Contract $40M Excess of $60M	All Business		95	%	Continental Casualty
Effective 10-01-02	Expiration 12-31-03	Excess of Loss Contract $40M Excess of $100M	All Business		100	%	Continental Casualty
Effective 10-01-03	Expiration 12-31-03	Excess of Loss Contract $3M Excess of $12M	All Business		100	%	Continental Casualty
Effective 01-01-04	Expiration 12-31-04	Excess of Loss Contract $50M Excess of $100M	All Business		100	%	Continental Casualty
Effective 01-01-05	Expiration 12-31-05	Excess of Loss Contract $50M Excess of $100M	All Business		100	%	Continental Casualty
Other Programs
Effective 03-01-95	Expiration 12-31-99	Quota Share (Miscellaneous Bonds)	All Business excluding California		100	%	Western Surety Company
Effective 10-01-97	Expiration 12-31-99	Quota Share Bonds Written in California	California Business		90	%	Western Surety Company
Effective 07-01-99	Expiration 11-25-02	Excess of Loss Contract Excess of $1.2M	All Business		100	%	Western Surety Company
Effective 11-25-02	Continuous	Excess of Loss Contract Excess of $500K	All Business		100	%	Western Surety Company

Milliman

Exhibit 11
Page 1

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Net Contract Surety* ($000s)

	Ultimate			Ultimate		Ultimate			Ultimate
Accident	Losses			ALAE		Loss & ALAE			Loss & ALAE
Year	@12/31/10			@12/31/10		@12/31/10			@12/31/09			Difference
1989		0			3		3			3			0
1990		(1	)		0		(1	)		(1	)		0
1991		0			0		0			0			0
1992		1			0		1			1			0
1993		1			0		1			1			0
1994		24			1		25			25			0
1995		4			1		5			5			0
1996		2			6		8			8			0
1997		3			0		3			3			0
1998		5			0		5			5			0
1999		44			6		50			45			5
2000		1,043			367		1,410			1,410			0
2001		7,668			629		8,297			8,361			(64	)
2002		6,920			1,026		7,946			8,075			(129	)
2003		16,654			2,323		18,977			18,961			16
2004		21,625			2,561		24,186			24,865			(679	)
2005		19,837			3,005		22,842			21,636			1,206
2006		9,732			1,557		11,289			27,241			(15,952	)
2007		21,070			2,096		23,166			30,663			(7,497	)
2008		28,575			2,428		31,003			42,657			(11,654	)
2009		48,480			4,010		52,490			52,636			(146	)
Total		181,687			20,019		201,706			236,600			(34,894	)

* Excludes Constar in 2007.

Milliman

Exhibit 11
Page 2

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF THE QUOTA SHARE TREATIES
NET OF SALVAGE & SUBROGATION

Net Commercial Surety ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		4,438		1,194		5,632		5,634		(2	)
1990		5,253		1,278		6,531		6,544		(13	)
1991		3,660		838		4,498		4,500		(2	)
1992		3,728		975		4,703		4,705		(2	)
1993		3,386		931		4,317		4,319		(2	)
1994		2,692		613		3,305		3,295		10
1995		4,197		953		5,150		5,165		(15	)
1996		4,326		999		5,325		5,338		(13	)
1997		4,257		1,167		5,424		5,408		16
1998		5,400		1,442		6,842		6,838		4
1999		7,518		2,174		9,692		9,510		182
2000		7,312		1,525		8,837		8,860		(23	)
2001		10,167		2,491		12,658		12,336		322
2002		7,928		1,410		9,338		9,547		(209	)
2003		7,819		1,591		9,410		9,484		(74	)
2004		9,310		1,528		10,838		10,836		2
2005		10,920		2,090		13,010		12,565		445
2006		14,530		3,473		18,003		17,619		384
2007		14,940		2,964		17,904		17,801		103
2008		23,958		4,207		28,165		25,056		3,109
2009		15,804		3,936		19,740		22,340		(2,600	)
Total		171,543		37,779		209,322		207,700		1,622

Milliman

Exhibit 11
Page 3

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF THE QUOTA SHARE TREATIES
NET OF SALVAGE & SUBROGATION

Net Fidelity ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		807		101		908		908		0
1990		1,062		146		1,208		1,209		(1	)
1991		831		82		913		913		0
1992		938		113		1,051		1,052		(1	)
1993		1,229		149		1,378		1,378		0
1994		1,245		237		1,482		1,482		0
1995		1,222		216		1,438		1,444		(6	)
1996		925		190		1,115		1,122		(7	)
1997		1,521		148		1,669		1,670		(1	)
1998		738		44		782		817		(35	)
1999		993		23		1,016		1,026		(10	)
2000		745		6		751		753		(2	)
2001		1,681		66		1,747		1,705		42
2002		1,098		21		1,119		1,141		(22	)
2003		1,437		49		1,486		1,529		(43	)
2004		1,455		27		1,482		1,452		30
2005		1,889		48		1,937		1,898		39
2006		1,445		25		1,470		1,596		(126	)
2007		1,902		58		1,960		1,646		314
2008		1,441		76		1,517		1,693		(176	)
2009		2,147		85		2,232		1,964		268
Total		26,751		1,910		28,661		28,398		263

Milliman

Exhibit 11
Page 4

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009

Notary E&O (Net = Gross) ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		117		67		183		183		0
1990		177		131		308		308		0
1991		22		35		57		57		0
1992		112		129		242		242		0
1993		67		59		126		126		0
1994		84		129		212		212		0
1995		309		353		662		662		0
1996		133		98		231		231		0
1997		130		105		235		235		0
1998		101		117		218		218		0
1999		107		111		218		218		0
2000		139		203		341		326		15
2001		186		170		356		355		1
2002		146		194		340		326		14
2003		147		212		359		363		(4	)
2004		177		271		448		415		33
2005		172		471		644		594		50
2006		205		392		596		420		176
2007		287		764		1,052		1,087		(36	)
2008		207		335		542		467		75
2009		140		294		434		394		40
Total		3,164		4,640		7,804		7,440		364

Milliman

Exhibit 11
Page 5

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009

Tax Preparers’ E&O (Net = Gross) ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Report	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		201		63		265		265		0
1990		375		118		493		493		0
1991		403		200		603		603		0
1992		400		147		547		547		0
1993		332		163		495		495		0
1994		427		316		743		743		0
1995		339		124		463		463		0
1996		268		101		369		369		0
1997		246		92		338		338		0
1998		288		102		390		390		0
1999		135		17		152		152		0
2000		178		42		220		220		0
2001		337		44		381		381		0
2002		262		105		367		367		0
2003		142		64		205		205		0
2004		172		32		204		204		0
2005		197		75		272		278		(5	)
2006		255		23		279		290		(11	)
2007		281		42		323		363		(40	)
2008		409		45		454		542		(88	)
2009		341		45		386		440		(54	)
Total		5,989		1,960		7,949		8,148		(198	)

Milliman

Exhibit 11
Page 6

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF THE QUOTA SHARE TREATIES
NET OF SALVAGE & SUBROGATION

Total Net Lines of Business* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		5,563		1,428		6,991		6,993		(2	)
1990		6,866		1,673		8,539		8,554		(15	)
1991		4,916		1,155		6,071		6,073		(2	)
1992		5,180		1,364		6,544		6,547		(3	)
1993		5,015		1,302		6,317		6,319		(2	)
1994		4,472		1,295		5,767		5,757		10
1995		6,071		1,647		7,718		7,739		(21	)
1996		5,654		1,394		7,048		7,068		(20	)
1997		6,157		1,511		7,668		7,654		14
1998		6,532		1,705		8,237		8,267		(30	)
1999		8,797		2,331		11,128		10,951		177
2000		9,417		2,143		11,560		11,569		(9	)
2001		20,039		3,400		23,439		23,138		301
2002		16,354		2,756		19,110		19,456		(346	)
2003		26,198		4,239		30,437		30,542		(105	)
2004		32,739		4,419		37,158		37,772		(614	)
2005		33,015		5,689		38,704		36,970		1,734
2006		26,167		5,470		31,637		47,166		(15,529	)
2007		38,480		5,924		44,404		51,560		(7,156	)
2008		54,590		7,091		61,681		70,415		(8,734	)
2009		66,911		8,370		75,281		77,774		(2,493	)
Total		389,133		66,306		455,439		488,284		(32,845	)

* Excludes Constar in 2007.

Milliman

Exhibit 12
Page 1

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Gross Contract Surety* ($000s)

	Ultimate			Ultimate		Ultimate			Ultimate
Accident	Losses			ALAE		Loss & ALAE			Loss & ALAE
Year	@12/31/10			@12/31/10		@12/31/10			@12/31/09			Difference
1989		0			3		3			3			0
1990		(1	)		0		(1	)		(1	)		0
1991		0			0		0			0			0
1992		1			0		1			1			0
1993		1			0		1			1			0
1994		24			4		28			28			0
1995		10			27		37			37			0
1996		887			498		1,385			1,385			0
1997		1,151			311		1,462			1,462			0
1998		1,395			396		1,791			1,791			0
1999		4,968			1,158		6,126			6,127			(1	)
2000		3,657			688		4,345			4,345			0
2001		8,922			1,031		9,953			10,017			(64	)
2002		8,464			1,119		9,583			9,772			(189	)
2003		17,482			2,422		19,904			19,911			(7	)
2004		29,471			3,024		32,495			33,287			(792	)
2005		25,179			3,352		28,531			26,914			1,617
2006		10,582			1,688		12,270			31,072			(18,802	)
2007		23,604			3,331		26,935			34,651			(7,716	)
2008		31,579			2,566		34,145			48,683			(14,538	)
2009		51,047			4,139		55,186			58,831			(3,645	)
Total		218,423			25,757		244,180			288,317			(44,137	)

* Excludes Constar in 2007.

Milliman

Exhibit 12
Page 2

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Gross Commercial Surety ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		4,597		1,290		5,887		5,889		(2	)
1990		5,643		1,396		7,039		7,052		(13	)
1991		3,960		898		4,858		4,860		(2	)
1992		4,021		1,031		5,052		5,054		(2	)
1993		3,841		983		4,824		4,827		(3	)
1994		3,043		666		3,709		3,699		10
1995		4,226		976		5,202		5,219		(17	)
1996		4,696		1,052		5,748		5,767		(19	)
1997		4,290		1,182		5,472		5,456		16
1998		5,546		1,447		6,993		6,989		4
1999		7,571		2,181		9,752		9,570		182
2000		7,333		1,542		8,875		8,894		(19	)
2001		10,192		2,500		12,692		12,385		307
2002		8,268		1,470		9,738		9,970		(232	)
2003		8,308		1,675		9,983		10,100		(117	)
2004		9,874		1,609		11,483		11,523		(40	)
2005		11,255		2,152		13,407		13,030		377
2006		14,584		3,488		18,072		17,687		385
2007		14,958		2,970		17,928		17,831		97
2008		23,967		4,207		28,174		25,065		3,109
2009		15,804		3,936		19,740		22,335		(2,595	)
Total		175,977		38,651		214,628		213,202		1,426

Milliman

Exhibit 12
Page 3

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Gross Fidelity ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		890		102		992		992		0
1990		1,059		145		1,204		1,205		(1	)
1991		831		82		913		913		0
1992		938		113		1,051		1,052		(1	)
1993		1,242		149		1,391		1,391		0
1994		1,251		237		1,488		1,488		0
1995		1,298		232		1,530		1,536		(6	)
1996		1,153		197		1,350		1,357		(7	)
1997		1,522		148		1,670		1,671		(1	)
1998		739		44		783		818		(35	)
1999		993		23		1,016		1,026		(10	)
2000		745		6		751		753		(2	)
2001		1,681		66		1,747		1,705		42
2002		1,148		22		1,170		1,194		(24	)
2003		1,528		52		1,580		1,626		(46	)
2004		1,549		29		1,578		1,546		32
2005		1,952		48		2,000		1,974		26
2006		1,445		25		1,470		1,596		(126	)
2007		1,902		58		1,960		1,647		313
2008		1,441		76		1,517		1,694		(177	)
2009		2,147		85		2,232		1,964		268
Total		27,454		1,939		29,393		29,148		245

Milliman

Exhibit 12
Page 4

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009

Notary E&O (Net = Gross) ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		117		67		183		183		0
1990		177		131		308		308		0
1991		22		35		57		57		0
1992		112		129		242		242		0
1993		67		59		126		126		0
1994		84		129		212		212		0
1995		309		353		662		662		0
1996		133		98		231		231		0
1997		130		105		235		235		0
1998		101		117		218		218		0
1999		107		111		218		218		0
2000		139		203		341		326		15
2001		186		170		356		355		1
2002		146		194		340		326		14
2003		147		212		359		363		(4	)
2004		177		271		448		415		33
2005		172		471		644		594		50
2006		205		392		596		420		176
2007		287		764		1,052		1,087		(36	)
2008		207		335		542		467		75
2009		140		294		434		394		40
Total		3,164		4,640		7,804		7,440		364

Milliman

Exhibit 12
Page 5

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009

Tax Preparers’ E&O (Net = Gross) ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Report	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		201		63		265		265		0
1990		375		118		493		493		0
1991		403		200		603		603		0
1992		400		147		547		547		0
1993		332		163		495		495		0
1994		427		316		743		743		0
1995		339		124		463		463		0
1996		268		101		369		369		0
1997		246		92		338		338		0
1998		288		102		390		390		0
1999		135		17		152		152		0
2000		178		42		220		220		0
2001		337		44		381		381		0
2002		262		105		367		367		0
2003		142		64		205		205		0
2004		172		32		204		204		0
2005		197		75		272		278		(5	)
2006		255		23		279		290		(11	)
2007		281		42		323		363		(40	)
2008		409		45		454		542		(88	)
2009		341		45		386		440		(54	)
Total		5,989		1,960		7,949		8,148		(198	)

Milliman

Exhibit 12
Page 6

WESTERN SURETY COMPANY — DIRECT BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Total Gross Lines of Business* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		5,805		1,525		7,330		7,332		(2	)
1990		7,253		1,790		9,043		9,058		(15	)
1991		5,216		1,215		6,431		6,433		(2	)
1992		5,473		1,420		6,893		6,896		(3	)
1993		5,483		1,354		6,837		6,840		(3	)
1994		4,829		1,351		6,180		6,170		10
1995		6,182		1,712		7,894		7,917		(23	)
1996		7,137		1,946		9,083		9,109		(26	)
1997		7,339		1,837		9,176		9,162		14
1998		8,069		2,106		10,175		10,205		(30	)
1999		13,774		3,490		17,264		17,093		171
2000		12,052		2,481		14,533		14,538		(5	)
2001		21,318		3,811		25,129		24,843		286
2002		18,288		2,910		21,198		21,629		(431	)
2003		27,606		4,425		32,031		32,205		(174	)
2004		41,243		4,965		46,208		46,975		(767	)
2005		38,755		6,098		44,853		42,789		2,064
2006		27,071		5,616		32,687		51,065		(18,378	)
2007		41,032		7,165		48,197		55,579		(7,382	)
2008		57,603		7,229		64,832		76,451		(11,619	)
2009		69,478		8,499		77,977		83,964		(5,987	)
Total		431,006		72,945		503,951		546,253		(42,302	)

* Excludes Constar in 2007.

Milliman

Exhibit 13
Page 1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
PRIOR TO STOP LOSS TREATY
NET OF SALVAGE & SUBROGATION

Net Contract Surety* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1987 & Prior		133,416		18,220		151,636		150,808		828
1988		13,766		1,756		15,522		15,539		(17	)
1989		16,891		2,807		19,698		19,729		(31	)
1990		18,301		4,631		22,932		23,017		(85	)
1991		31,563		4,872		36,435		36,564		(129	)
1992		26,021		8,437		34,458		34,599		(141	)
1993		30,342		7,520		37,862		37,890		(28	)
1994		34,825		5,870		40,695		40,827		(132	)
1995		6,524		3,003		9,527		9,558		(31	)
1996		10,344		1,845		12,189		12,150		39
1997		N/A		N/A		10,277		9,915		362
1998		N/A		N/A		13,672		13,768		(96	)
1999		N/A		N/A		23,864		24,291		(427	)
2000		N/A		N/A		45,521		45,900		(379	)
2001		N/A		N/A		50,860		48,258		2,602
2002		N/A		N/A		38,718		38,980		(262	)
2003		N/A		N/A		52,859		52,665		194
2004		N/A		N/A		13,752		13,819		(67	)
2005		N/A		N/A		5,166		5,378		(212	)
2006		N/A		N/A		3,453		9,739		(6,286	)
2007		N/A		N/A		6,818		12,908		(6,090	)
2008		N/A		N/A		8,886		16,460		(7,574	)
2009		N/A		N/A		14,238		20,524		(6,286	)
Total		321,993		58,961		669,038		693,286		(24,248	)

* Excludes Dick Corporation in 2005.

Milliman

Exhibit 13
Page 2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
PRIOR TO STOP LOSS TREATY
NET OF SALVAGE & SUBROGATION

Net Commercial Surety* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1987 & Prior		60,285		8,612		68,897		69,816		(919	)
1988		3,446		1,037		4,483		4,490		(7	)
1989		5,566		1,360		6,926		6,940		(14	)
1990		9,885		1,867		11,752		11,786		(34	)
1991		9,122		1,001		10,123		10,139		(16	)
1992		2,944		559		3,503		3,516		(13	)
1993		2,449		625		3,074		3,085		(11	)
1994		2,395		503		2,898		2,904		(6	)
1995		2,228		306		2,534		2,537		(3	)
1996		3,601		491		4,092		4,248		(156	)
1997		N/A		N/A		2,574		2,588		(14	)
1998		N/A		N/A		7,578		7,565		13
1999		N/A		N/A		4,363		4,386		(23	)
2000		N/A		N/A		6,669		6,884		(215	)
2001		N/A		N/A		17,722		17,787		(65	)
2002		N/A		N/A		3,477		3,433		44
2003		N/A		N/A		24,224		24,905		(681	)
2004		N/A		N/A		2,396		2,113		283
2005		N/A		N/A		821		2,173		(1,352	)
2006		N/A		N/A		385		954		(569	)
2007		N/A		N/A		629		1,570		(941	)
2008		N/A		N/A		766		1,658		(892	)
2009		N/A		N/A		1,278		1,537		(259	)
Total		101,921		16,361		191,164		197,014		(5,850	)

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

Exhibit 13
Page 3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
PRIOR TO STOP LOSS TREATY
NET OF SALVAGE & SUBROGATION

Total Net Lines of Business* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1987 & Prior		193,701		26,832		220,533		220,624		(91	)
1988		17,212		2,793		20,005		20,029		(24	)
1989		22,457		4,167		26,624		26,669		(45	)
1990		28,186		6,498		34,684		34,803		(119	)
1991		40,685		5,873		46,558		46,703		(145	)
1992		28,965		8,996		37,961		38,115		(154	)
1993		32,791		8,145		40,936		40,975		(39	)
1994		37,220		6,373		43,593		43,731		(138	)
1995		8,752		3,309		12,061		12,095		(34	)
1996		13,945		2,336		16,281		16,398		(117	)
1997		N/A		N/A		12,851		12,503		348
1998		N/A		N/A		21,250		21,333		(83	)
1999		N/A		N/A		28,227		28,677		(450	)
2000		N/A		N/A		52,190		52,784		(594	)
2001		N/A		N/A		68,582		66,045		2,537
2002		N/A		N/A		42,195		42,413		(218	)
2003		N/A		N/A		77,083		77,570		(487	)
2004		N/A		N/A		16,148		15,932		216
2005		N/A		N/A		5,987		7,551		(1,564	)
2006		N/A		N/A		3,838		10,693		(6,855	)
2007		N/A		N/A		7,447		14,478		(7,031	)
2008		N/A		N/A		9,652		18,118		(8,466	)
2009		N/A		N/A		15,516		22,061		(6,545	)
Total		423,914		75,322		860,202		890,300		(30,098	)

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002, Dick Corporation in 2005 and Delphi in 2009.

Milliman

Exhibit 14
Page 1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Gross Contract Surety* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1997		8,500		2,930		11,430		11,085		345
1998		13,659		3,839		17,498		17,589		(91	)
1999		22,307		3,238		25,545		26,047		(502	)
2000		62,130		10,056		72,186		73,277		(1,091	)
2001		44,247		8,408		52,655		49,935		2,720
2002		37,993		2,581		40,574		40,664		(90	)
2003		51,288		9,188		60,476		60,636		(160	)
2004		18,428		2,578		21,006		21,121		(115	)
2005		8,721		2,200		10,921		12,427		(1,506	)
2006		3,601		682		4,283		11,617		(7,334	)
2007		8,540		1,349		9,889		17,243		(7,354	)
2008		9,962		2,548		12,510		20,058		(7,548	)
2009		14,113		2,103		16,216		25,489		(9,273	)
Total		303,489		51,700		355,189		387,188		(31,999	)

* Excludes Dick Corporation in 2005.

Milliman

Exhibit 14
Page 2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Gross Commercial Surety* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1997		2,279		384		2,663		2,676		(13	)
1998		6,609		1,033		7,642		7,668		(26	)
1999		15,196		3,235		18,431		18,671		(240	)
2000		23,310		769		24,079		24,408		(329	)
2001		14,039		5,529		19,568		18,886		682
2002		2,037		1,530		3,567		3,561		6
2003		25,520		1,490		27,010		27,823		(813	)
2004		2,091		320		2,411		2,146		265
2005		610		231		841		2,359		(1,518	)
2006		483		123		606		1,412		(806	)
2007		951		113		1,064		1,620		(556	)
2008		1,398		260		1,658		1,773		(115	)
2009		1,275		429		1,704		1,666		38
Total		95,798		15,446		111,244		114,669		(3,425	)

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

Exhibit 14
Page 3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Total Gross Lines of Business* ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1997		10,779		3,314		14,093		13,761		332
1998		20,268		4,872		25,140		25,257		(117	)
1999		37,503		6,473		43,976		44,718		(742	)
2000		85,440		10,825		96,265		97,685		(1,420	)
2001		58,286		13,937		72,223		68,821		3,402
2002		40,030		4,111		44,141		44,225		(84	)
2003		76,808		10,678		87,486		88,459		(973	)
2004		20,519		2,898		23,417		23,267		150
2005		9,331		2,431		11,762		14,786		(3,024	)
2006		4,084		805		4,889		13,029		(8,140	)
2007		9,491		1,462		10,953		18,863		(7,910	)
2008		11,360		2,808		14,168		21,831		(7,663	)
2009		15,388		2,532		17,920		27,155		(9,235	)
Total		399,287		67,146		466,433		501,857		(35,424	)

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002, Dick Corporation in 2005 and Delphi in 2009.

Milliman

Exhibit 15
Page 1

SURETY BONDING COMPANY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Net Surety ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1995		0		0		0		0		0
1996		3		0		3		3		0
1997		5		0		5		5		0
1998		6		4		9		9		0
1999		27		6		34		34		0
2000		33		19		52		52		(0	)
2001		6		8		14		14		0
2002		27		11		38		38		(0	)
2003		44		10		54		55		(2	)
2004		44		17		61		50		11
2005		74		18		92		81		11
2006		89		30		119		111		9
2007		131		33		164		156		8
2008		91		20		111		111		(0	)
2009		58		15		73		70		3
Total		640		190		831		791		40

Milliman

Exhibit 15
Page 2

SURETY BONDING COMPANY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009

Net Notary E&O ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1995		0		0		0		0		0
1996		0		0		0		0		0
1997		0		1		1		1		0
1998		3		10		13		13		0
1999		21		24		45		44		1
2000		30		36		65		65		1
2001		18		21		38		37		1
2002		30		88		118		116		3
2003		43		81		124		115		9
2004		64		155		219		204		15
2005		133		277		410		417		(7	)
2006		65		162		227		219		8
2007		28		56		83		82		1
2008		10		31		41		38		3
2009		6		16		21		22		(0	)
Total		449		957		1,406		1,373		34

Milliman

Exhibit 15
Page 3

SURETY BONDING COMPANY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Total Net Lines of Business ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1995		0		0		0		0		0
1996		3		0		3		3		0
1997		6		1		6		6		0
1998		9		14		22		22		0
1999		48		31		79		78		1
2000		63		55		118		117		1
2001		23		29		52		50		1
2002		57		100		157		154		3
2003		87		91		178		170		7
2004		109		171		280		255		25
2005		207		295		502		498		4
2006		154		192		346		330		17
2007		159		89		247		238		9
2008		101		51		152		149		3
2009		64		31		95		92		3
Total		1,089		1,148		2,237		2,163		74

Milliman

Exhibit 16
Page 1

SURETY BONDING COMPANY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Gross Surety ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1995		0		0		0		0		0
1996		31		0		31		31		0
1997		54		0		55		55		0
1998		59		35		94		94		0
1999		275		64		339		339		0
2000		332		192		524		524		(0	)
2001		56		79		135		135		0
2002		271		113		384		385		(1	)
2003		439		97		536		555		(19	)
2004		444		166		610		503		107
2005		745		180		925		810		115
2006		895		299		1,193		1,105		88
2007		1,310		330		1,640		1,559		81
2008		908		202		1,110		1,110		(0	)
2009		585		149		734		701		33
Total		6,403		1,905		8,308		7,905		403

Milliman

Exhibit 16
Page 2

SURETY BONDING COMPANY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009

Gross Notary E&O ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1995		0		0		0		0		0
1996		0		0		0		0		0
1997		1		5		6		6		0
1998		30		101		131		131		0
1999		208		243		450		443		7
2000		295		357		653		646		7
2001		176		206		382		368		14
2002		297		885		1,182		1,156		26
2003		428		807		1,235		1,144		90
2004		644		1,553		2,197		2,048		148
2005		1,329		2,771		4,099		4,173		(74	)
2006		647		1,621		2,268		2,191		77
2007		276		560		836		822		14
2008		98		312		410		380		30
2009		58		156		214		219		(5	)
Total		4,487		9,577		14,064		13,728		336

Milliman

Exhibit 16
Page 3

SURETY BONDING COMPANY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Total Gross Lines of Business ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1995		0		0		0		0		0
1996		31		0		31		31		0
1997		55		5		61		61		0
1998		89		136		224		224		0
1999		483		306		789		782		7
2000		627		550		1,177		1,170		7
2001		232		286		518		503		14
2002		569		998		1,566		1,541		25
2003		867		904		1,770		1,699		71
2004		1,088		1,718		2,806		2,551		255
2005		2,074		2,951		5,024		4,983		41
2006		1,541		1,920		3,461		3,296		165
2007		1,586		890		2,476		2,381		95
2008		1,006		514		1,520		1,490		30
2009		643		306		948		920		28
Total		10,890		11,482		22,372		21,633		739

Milliman

Exhibit 17

UNIVERSAL SURETY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Net Surety ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		500		64		564		564		0
1990		163		31		194		194		0
1991		236		50		286		286		0
1992		167		125		292		292		0
1993		516		203		719		719		0
1994		1,017		222		1,239		1,239		0
1995		1,012		234		1,246		1,246		0
1996		986		508		1,494		1,494		0
1997		1,514		238		1,752		1,752		0
1998		2,358		605		2,963		2,961		2
1999		5,040		1,111		6,151		6,150		1
2000		4,673		547		5,220		5,220		0
2001		2,132		250		2,382		2,398		(16	)
2002		277		142		419		420		(1	)
2003		353		60		413		438		(25	)
2004		284		71		355		393		(38	)
2005		362		102		464		593		(129	)
2006		259		98		357		511		(154	)
2007		204		168		372		819		(447	)
2008		358		219		577		1,081		(504	)
2009		405		247		652		1,123		(471	)
Total		22,816		5,295		28,111		29,893		(1,782	)

Milliman

Exhibit 18

UNIVERSAL SURETY OF AMERICA
COMPARISON OF MILLIMAN INDICATED ULTIMATE LOSS AND ALAE
DECEMBER 31, 2010 VERSUS DECEMBER 31, 2009
NET OF SALVAGE & SUBROGATION

Gross Surety ($000s)

	Ultimate		Ultimate		Ultimate		Ultimate
Accident	Losses		ALAE		Loss & ALAE		Loss & ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/09		Difference
1989		1,257		79		1,336		1,336		0
1990		396		41		437		437		0
1991		786		60		846		846		0
1992		447		156		603		603		0
1993		1,395		498		1,893		1,893		0
1994		3,828		429		4,257		4,257		0
1995		2,706		483		3,189		3,189		0
1996		2,143		838		2,981		2,981		0
1997		3,297		526		3,823		3,823		0
1998		4,938		984		5,922		5,920		2
1999		5,150		1,195		6,345		6,344		1
2000		4,673		563		5,236		5,236		0
2001		2,132		250		2,382		2,398		(16	)
2002		277		142		419		420		(1	)
2003		353		60		413		438		(25	)
2004		284		71		355		393		(38	)
2005		362		102		464		593		(129	)
2006		259		98		357		511		(154	)
2007		204		168		372		819		(447	)
2008		358		219		577		1,081		(504	)
2009		405		247		652		1,123		(471	)
Total		35,650		7,209		42,859		44,641		(1,782	)

Milliman

WESTERN SURETY COMPANY
DIRECT BUSINESS

Milliman

WSC Direct Business
Exhibit A1

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1		1		1		1		1
1993		0		19		19		19		19		19		19		19		19		20		20		20		20		20		20		20		20		20
1994		0		0		0		0		0		0		0		21		21		24		24		24		24		24		24		24		24
1995		0		16		16		16		16		16		16		18		19		19		19		19		19		19		19		19
1996		20		1,062		1,096		1,161		1,161		1,207		1,209		1,209		1,209		1,208		1,208		1,208		1,208		1,208		1,208
1997		139		1,242		1,512		1,514		1,514		1,550		1,733		1,733		1,728		1,728		1,728		1,728		1,728		1,728
1998		1,054		2,207		2,637		2,730		2,733		2,730		2,734		2,726		2,723		2,723		2,723		2,723		2,723
1999		1,989		5,842		6,795		7,581		7,691		7,887		8,066		8,066		8,066		8,066		8,066		8,066
2000		260		1,929		3,606		4,782		4,897		5,013		5,063		5,063		5,063		5,063		5,063
2001		3,273		8,413		9,472		11,180		11,196		11,556		11,618		11,632		11,632		11,632
2002		2,093		6,551		8,652		9,682		10,286		10,751		10,751		10,951		10,951
2003		2,953		12,818		17,392		21,452		23,868		25,429		27,138		27,143
2004		3,110		19,666		26,771		29,354		32,860		33,883		40,174
2005		879		7,816		25,586		30,746		31,673		34,529
2006		1,984		7,880		15,744		16,846		17,159
2007		6,019		11,318		15,811		16,823
2008		3,944		12,234		15,251
2009		6,004		16,191
2010		7,396

* Excludes Constar in 2007. Last Diagonal is as of 9/30/10.

	Paid Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.053		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994																1.000		1.143		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995				1.000		1.000		1.000		1.000		1.000		1.125		1.056		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		53.100		1.032		1.059		1.000		1.040		1.002		1.000		1.000		0.999		1.000		1.000		1.000		1.000		1.000
1997		8.935		1.217		1.001		1.000		1.024		1.118		1.000		0.997		1.000		1.000		1.000		1.000		1.000
1998		2.094		1.195		1.035		1.001		0.999		1.001		0.997		0.999		1.000		1.000		1.000		1.000
1999		2.937		1.163		1.116		1.015		1.025		1.023		1.000		1.000		1.000		1.000		1.000
2000		7.419		1.869		1.326		1.024		1.024		1.010		1.000		1.000		1.000		1.000
2001		2.570		1.126		1.180		1.001		1.032		1.005		1.001		1.000		1.000
2002		3.130		1.321		1.119		1.062		1.045		1.000		1.019		1.000
2003		4.341		1.357		1.233		1.113		1.065		1.067		1.000
2004		6.323		1.361		1.096		1.119		1.031		1.255
2005		8.892		3.274		1.202		1.030		1.122
2006		3.972		1.998		1.070		1.025
2007		1.880		1.397		1.086
2008		3.102		1.342
2009		3.754
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	8.032	1.443	1.109	1.030	1.034	1.040	1.013	1.005	1.019	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	4.320	1.874	1.138	1.070	1.059	1.067	1.004	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	4.789	1.337	1.100	1.025	1.029	1.023	1.002	1.000	1.007	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	3.609	1.585	1.128	1.068	1.048	1.028	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	3.604	1.530	1.142	1.059	1.060	1.108	1.003	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	3.281	1.703	1.141	1.073	1.066	1.121	1.004	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 3	2.886	1.526	1.133	1.063	1.073	1.148	1.004	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24	24 - 36	36 - 48	48 - 60	60 - 72	72 - 84	84 - 96	96 - 108	108 - 120	120 - 132	132 - 144	144 - 156	156 - 168	168 - 180	180 - 192	192 - 204	204 - 216	216 - 228	228 - 240	240 - 252	252 - 264	To Ult
Contr Assumed	5.160	1.527	1.247	1.098	1.089	1.015	1.011	1.005	1.006	1.005	1.004	1.003	1.002	1.002	1.002	1.001	1.001	1.001	1.001	1.001	1.001	1.003
Selected	3.604	1.703	1.141	1.073	1.066	1.015	1.011	1.005	1.006	1.005	1.004	1.003	1.002	1.002	1.002	1.001	1.001	1.001	1.001	1.001	1.001	1.003
	12-Ult	24-Ult	36-Ult	48-Ult	60-Ult	72-Ult	84-Ult	96-Ult	108-Ult	120-Ult	132-Ult	144-Ult	156-Ult	168-Ult	180-Ult	192-Ult	204-Ult	216-Ult	228-Ult	240-Ult	252-Ult	264-Ult
Dec Cumulatives	8.531	2.367	1.390	1.218	1.135	1.065	1.049	1.038	1.033	1.027	1.022	1.018	1.015	1.013	1.011	1.009	1.008	1.007	1.006	1.005	1.004	1.003
	9-Ult	21-Ult	33-Ult	45-Ult	57-Ult	69-Ult	81-Ult	93-Ult	105-Ult	117-Ult	129-Ult	141-Ult	153-Ult	165-Ult	177-Ult	189-Ult	201-Ult	213-Ult	225-Ult	237-Ult	249-Ult	261-Ult
Sep Cumulatives	13.285	3.261	1.588	1.259	1.155	1.082	1.053	1.041	1.034	1.029	1.023	1.019	1.016	1.014	1.012	1.010	1.008	1.007	1.006	1.005	1.004	1.003

Milliman

WSC Direct Business
Exhibit A2

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection*

																			Indicated
							Cumulative Paid Loss						Indicated Ultimate						Ultimate
	Paid Losses ($000s)						Development Factors						Paid Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		8		8		8		1.005		1.004		1.003		8		8		8		8
1990		0		0		0		1.006		1.005		1.004		0		0		0		0
1991		0		0		0		1.007		1.006		1.005		0		0		0		0
1992		1		1		1		1.008		1.007		1.006		1		1		1		1
1993		20		20		20		1.009		1.008		1.007		20		20		20		20
1994		24		24		24		1.011		1.009		1.008		24		24		24		24
1995		19		19		19		1.013		1.011		1.010		19		19		19		19
1996		1,208		1,208		1,208		1.015		1.013		1.012		1,226		1,224		1,222		1,222
1997		1,728		1,728		1,728		1.018		1.015		1.014		1,759		1,754		1,752		1,752
1998		2,723		2,723		2,723		1.022		1.018		1.016		2,783		2,772		2,767		2,767
1999		8,066		8,066		8,066		1.027		1.022		1.019		8,284		8,243		8,219		8,219
2000		5,063		5,063		5,063		1.033		1.027		1.023		5,230		5,200		5,179		5,179
2001		11,632		11,632		11,632		1.038		1.033		1.029		12,074		12,016		11,969		11,969
2002		10,751		10,951		10,951		1.049		1.038		1.034		11,278		11,367		11,323		11,323
2003		25,429		27,138		27,143		1.065		1.049		1.041		27,082		28,468		28,256		28,256
2004		32,860		33,883		40,174		1.135		1.065		1.053		37,296		36,085		42,303		42,303
2005		30,746		31,673		34,529		1.218		1.135		1.082		37,449		35,949		37,360		37,360
2006		15,744		16,846		17,159		1.390		1.218		1.155		21,884		20,518		19,819		19,819
2007		11,318		15,811		16,823		2.367		1.390		1.259		26,790		21,977		21,180		21,180
2008		3,944		12,234		15,251		8.531		2.367		1.588		33,646		28,958		24,219		24,219
2009				6,004		16,191				8.531		3.261				51,220		52,799		52,799
2010						7,396						13.285						98,256		73,692

*	Excludes Constar in 2007.
Note:	The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit A3

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Incurred Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		13		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1		1		1		1		1
1993		0		19		19		19		19		19		19		19		19		20		20		20		20		20		20		20		20		20
1994		4		23		0		0		0		0		0		21		21		24		24		24		24		24		24		24		24
1995		45		143		86		16		16		16		16		18		19		19		19		19		19		19		19		19
1996		70		1,112		1,265		1,490		1,476		1,207		1,209		1,209		1,209		1,208		1,208		1,208		1,208		1,208		1,208
1997		139		1,391		1,635		1,554		1,514		1,550		1,733		1,733		1,728		1,728		1,728		1,728		1,728		1,728
1998		1,558		2,601		2,969		3,010		2,930		2,733		2,737		2,726		2,723		2,723		2,723		2,723		2,723
1999		2,661		7,471		8,010		8,311		8,369		8,414		8,286		8,118		8,066		8,066		8,066		8,066
2000		436		2,240		4,880		5,452		5,546		5,522		5,214		5,063		5,063		5,063		5,063
2001		4,665		9,806		10,686		11,660		11,512		11,628		11,652		11,654		11,632		11,632
2002		2,405		8,385		9,744		10,542		10,965		11,055		10,853		10,951		10,951
2003		4,054		15,966		21,855		27,516		27,414		26,560		27,202		27,170
2004		6,162		29,124		36,441		37,923		40,597		37,618		43,864
2005		1,664		13,455		34,982		37,821		37,974		38,677
2006		2,446		11,935		16,812		18,498		18,631
2007		6,817		13,428		16,957		17,613
2008		5,859		13,957		17,961
2009		15,335		33,832
2010		10,553

* Excludes Constar in 2007. Last Diagonal is as of 9/30/10.

	Incurred Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.625		0.615		1.000		1.000		1.000		1.000		1.000
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.053		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		5.750		0.000												1.000		1.143		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		3.178		0.601		0.186		1.000		1.000		1.000		1.125		1.056		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		15.886		1.138		1.178		0.991		0.818		1.002		1.000		1.000		0.999		1.000		1.000		1.000		1.000		1.000
1997		10.007		1.175		0.950		0.974		1.024		1.118		1.000		0.997		1.000		1.000		1.000		1.000		1.000
1998		1.669		1.141		1.014		0.973		0.933		1.001		0.996		0.999		1.000		1.000		1.000		1.000
1999		2.808		1.072		1.038		1.007		1.005		0.985		0.980		0.994		1.000		1.000		1.000
2000		5.138		2.179		1.117		1.017		0.996		0.944		0.971		1.000		1.000		1.000
2001		2.102		1.090		1.091		0.987		1.010		1.002		1.000		0.998		1.000
2002		3.486		1.162		1.082		1.040		1.008		0.982		1.009		1.000
2003		3.938		1.369		1.259		0.996		0.969		1.024		0.998
2004		4.726		1.251		1.041		1.071		0.927		1.227
2005		8.086		2.600		1.081		1.004		1.025
2006		4.879		1.409		1.100		1.010
2007		1.970		1.263		1.052
2008		2.382		1.400
2009		2.872
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	4.930	1.241	1.014	1.005	0.976	1.024	1.007	1.004	1.019	1.000	1.000	1.000	1.000	1.000	1.125	0.904	1.000	1.000	1.000	1.000	1.000
Latest 5	4.038	1.584	1.107	1.024	0.988	1.036	0.992	0.998	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	4.380	1.232	1.062	1.002	0.987	1.011	0.998	0.999	1.007	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	3.378	1.357	1.078	1.018	0.996	1.003	0.993	0.999	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	3.223	1.418	1.092	1.020	0.979	1.082	0.996	0.998	1.000	1.000	1.000	1.000	1.000	1.000	1.069	0.914	1.000	1.000	1.000	1.000	1.000
Latest 5	3.014	1.523	1.099	1.025	0.979	1.094	0.996	0.998	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 3	2.550	1.356	1.079	1.032	0.973	1.120	1.001	0.999	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24	24 - 36	36 - 48	48 - 60	60 - 72	72 - 84	84 - 96	96 - 108	108 - 120	120 - 132	132 - 144	144 - 156	156 - 168	168 - 180	180 - 192	192 - 204	204 - 216	216 - 228	228 - 240	240 - 252	252 - 264	To Ult
Contr Assumed	3.881	1.288	1.103	1.031	1.020	1.009	1.005	1.003	1.002	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.000	1.001
Selected	3.014	1.523	1.099	1.031	1.020	1.009	1.005	1.003	1.002	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.001	1.000	1.001
	12-Ult	24-Ult	36-Ult	48-Ult	60-Ult	72-Ult	84-Ult	96-Ult	108-Ult	120-Ult	132-Ult	144-Ult	156-Ult	168-Ult	180-Ult	192-Ult	204-Ult	216-Ult	228-Ult	240-Ult	252-Ult	264-Ult
Dec Cumulatives	5.470	1.815	1.192	1.085	1.052	1.031	1.022	1.017	1.014	1.012	1.011	1.010	1.009	1.008	1.007	1.006	1.005	1.004	1.003	1.002	1.001	1.001
	9-Ult	21-Ult	33-Ult	45-Ult	57-Ult	69-Ult	81-Ult	93-Ult	105-Ult	117-Ult	129-Ult	141-Ult	153-Ult	165-Ult	177-Ult	189-Ult	201-Ult	213-Ult	225-Ult	237-Ult	249-Ult	261-Ult
Sep Cumulatives	8.112	2.391	1.324	1.111	1.060	1.036	1.024	1.018	1.015	1.013	1.011	1.010	1.009	1.008	1.007	1.006	1.005	1.004	1.003	1.002	1.001	1.001

Milliman

WSC Direct Business
Exhibit A4

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection*

																			Indicated
							Cumulative Incurred Loss						Indicated Ultimate						Ultimate
	Incurred Losses ($000s)						Development Factors						Incurred Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		8		8		8		1.002		1.001		1.001		8		8		8		8
1990		0		0		0		1.003		1.002		1.001		0		0		0		0
1991		0		0		0		1.004		1.003		1.002		0		0		0		0
1992		1		1		1		1.005		1.004		1.003		1		1		1		1
1993		20		20		20		1.006		1.005		1.004		20		20		20		20
1994		24		24		24		1.007		1.006		1.005		24		24		24		24
1995		19		19		19		1.008		1.007		1.006		19		19		19		19
1996		1,208		1,208		1,208		1.009		1.008		1.007		1,219		1,218		1,216		1,216
1997		1,728		1,728		1,728		1.010		1.009		1.008		1,745		1,744		1,742		1,742
1998		2,723		2,723		2,723		1.011		1.010		1.009		2,753		2,750		2,748		2,748
1999		8,066		8,066		8,066		1.012		1.011		1.010		8,163		8,155		8,147		8,147
2000		5,063		5,063		5,063		1.014		1.012		1.011		5,134		5,124		5,119		5,119
2001		11,654		11,632		11,632		1.017		1.014		1.013		11,852		11,795		11,783		11,783
2002		10,853		10,951		10,951		1.022		1.017		1.015		11,092		11,137		11,115		11,115
2003		26,560		27,202		27,170		1.031		1.022		1.018		27,383		27,800		27,659		27,659
2004		40,597		37,618		43,864		1.052		1.031		1.024		42,708		38,784		44,917		44,917
2005		37,821		37,974		38,677		1.085		1.052		1.036		41,036		39,949		40,069		40,069
2006		16,812		18,498		18,631		1.192		1.085		1.060		20,040		20,070		19,749		19,749
2007		13,428		16,957		17,613		1.815		1.192		1.111		24,372		20,213		19,568		19,568
2008		5,859		13,957		17,961		5.470		1.815		1.324		32,049		25,332		23,780		23,780
2009				15,335		33,832				5.470		2.391				83,882		80,892		80,892
2010						10,553						8.112						85,606		64,205

*	Excludes Constar in 2007.
Note:	The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit A5

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1989 — 2006 Ultimate Losses ($000s)

			Indicated Ultimate
			Losses Based on:
	Incurred				Incurred		Selected
Accident	Losses		Paid Loss		Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1989		8		8		8		8
1990		0		0		0		0
1991		0		0		0		0
1992		1		1		1		1
1993		20		20		20		20
1994		24		24		24		24
1995		19		19		19		19
1996		1,208		1,222		1,216		1,208
1997		1,728		1,752		1,742		1,728
1998		2,723		2,767		2,748		2,723
1999		8,066		8,219		8,147		8,066
2000		5,063		5,179		5,119		5,063
2001		11,632		11,969		11,783		11,632
2002		10,951		11,323		11,115		10,951
2003		27,170		28,256		27,659		27,958
2004		43,864		42,303		44,917		44,917
2005		38,677		37,360		40,069		40,069
2006		18,631		19,819		19,749		19,749
Total		169,785		170,241		174,336		174,136

Milliman

WSC Direct Business
Exhibit A6

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection* ($000s)

	Selected
	Ultimate		Gross Earned		Gross Loss
Accident	Losses		Premium		Ratio
Year	@9/30/10		@9/30/10		@9/30/10
1994		24		696		3.4	%
1995		19		1,247		1.5	%
1996		1,208		3,006		40.2	%
1997		1,728		4,579		37.7	%
1998		2,723		7,294		37.3	%
1999		8,066		8,347		96.6	%
2000		5,063		11,606		43.6	%
2001		11,632		19,959		58.3	%
2002		10,951		33,278		32.9	%
2003		27,958		56,264		49.7	%
2004		44,917		108,452		41.4	%
2005		40,069		144,316		27.8	%
2006		19,749		173,556		11.4	%
Total		174,107		572,600		30.4	%
Total 02-06		143,644		515,866		27.8	%
Selected Loss Ratio						27.8	%

						Loss Ratio
Accident	Gross Earned		Selected Loss			Projection
Year	Premium		Ratio			@9/30/10
2007		200,090		27.8	%		55,625
2008		201,926		27.8	%		56,135
2009		196,702		27.8	%		54,683
2010		148,082		27.8	%		41,167

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit A7

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection* ($000s)

	A’priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent					Losses		Ultimate
Year	Losses**		Unreported			Indicated IBNR		@9/30/10		Losses***
2007		55,625		10.0	%		5,563		17,613		23,176
2008		56,135		24.5	%		13,753		17,961		31,714
2009		54,683		58.2	%		31,826		33,832		65,658
2010		54,889		87.7	%		48,138		10,553		44,018
Total		221,332					99,280		79,959		164,566

*	Excludes Constar in 2007.
**	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit A8

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection* ($000s)

	A’priori		Estimated							Indicated
Accident	Ultimate		Percent			Indicated		Paid Losses		Ultimate
Year	Losses**		Unpaid			Unpaid		@9/30/10		Losses***
2007		55,625		20.6	%		11,459		16,823		28,282
2008		56,135		37.0	%		20,770		15,251		36,021
2009		54,683		69.3	%		37,895		16,191		54,086
2010		54,889		92.5	%		50,772		7,396		43,626
Total		221,332					120,896		55,661		162,015

*	Excludes Constar in 2007.
**	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit A9

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2007 — 2010 Ultimate Losses* ($000s)

					Indicated Ultimate Losses** Based on:										Selected
	Incurred		Gross				Incurred								Ultimate		Ultimate
Accident	Losses		Earned		Paid Loss		Loss		Incurred B/F		Paid B/F		Loss Ratio		Losses		Loss Ratio
Year	@9/30/10		Premium**		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2007		17,613		200,090		21,180		19,568		23,176		28,282		55,625		31,663		15.8	%
2008		17,961		201,926		24,219		23,780		31,714		36,021		56,135		43,925		21.8	%
2009		33,832		196,702		52,799		80,892		65,658		54,086		54,683		65,658		33.4	%
2010		10,553		148,082		73,692		64,205		44,018		43,626		41,167		42,593		28.8	%
Total		79,959		746,800		171,890		188,445		164,566		162,015		207,610		183,839		24.6	%

*	Excludes Constar in 2007.
**	Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Direct Business
Exhibit A10

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses* ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		8		8		8		0		0		0
1990		0		0		0		0		0		0
1991		0		0		0		0		0		0
1992		1		1		1		0		0		0
1993		20		20		20		0		0		0
1994		24		24		24		0		0		0
1995		19		19		19		0		0		0
1996		1,208		1,208		1,208		0		0		0
1997		1,728		1,728		1,728		0		0		0
1998		2,723		2,723		2,723		0		0		0
1999		8,066		8,066		8,066		0		0		0
2000		5,063		5,063		5,063		0		0		0
2001		11,632		11,632		11,632		0		0		0
2002		10,951		10,951		10,951		0		0		0
2003		27,958		27,170		27,143		27		788		815
2004		44,917		43,864		40,174		3,690		1,053		4,743
2005		40,069		38,677		34,529		4,148		1,392		5,540
2006		19,749		18,631		17,159		1,472		1,118		2,590
2007		31,663		17,613		16,823		790		14,050		14,840
2008		43,925		17,961		15,251		2,710		25,964		28,674
2009		65,658		33,832		16,191		17,641		31,826		49,467
2010		42,593		10,553		7,396		3,157		32,040		35,197
Total		357,975		249,744		216,109		33,635		108,231		141,866

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit A11

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		0		0		0		0		0		0		0		0		0		3		3		3		3		3		3		3		3
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1993		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1994		4		4		4		4		4		4		4		4		4		4		4		4		4		4		4		4		4
1995		0		9		21		27		27		27		27		27		27		27		27		27		27		27		27		27
1996		19		206		248		339		399		495		497		497		498		498		498		498		498		498		498
1997		14		189		261		280		283		284		311		311		311		311		311		311		311		311
1998		70		233		303		354		384		389		397		397		396		396		396		396		396
1999		172		441		763		910		1,018		1,086		1,140		1,142		1,151		1,152		1,158		1,158
2000		17		193		410		541		658		677		688		688		688		688		688
2001		49		314		532		740		805		850		923		1,024		1,028		1,031
2002		60		236		432		732		799		817		935		1,105		1,116
2003		127		718		1,157		1,473		1,691		1,803		2,048		2,111
2004		82		702		1,267		1,527		1,848		2,076		2,215
2005		8		489		1,133		1,591		2,037		2,409
2006		36		151		515		872		1,048
2007		121		695		1,356		1,532
2008		91		399		578
2009		181		394
2010		102

* Last Diagonal is as of 9/30/10.

	Paid ALAE Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989																														1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992
1993
1994		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995				2.333		1.286		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		10.842		1.204		1.367		1.177		1.241		1.004		1.000		1.002		1.000		1.000		1.000		1.000		1.000		1.000
1997		13.500		1.381		1.073		1.011		1.004		1.095		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		3.329		1.300		1.168		1.085		1.013		1.021		1.000		0.997		1.000		1.000		1.000		1.000
1999		2.564		1.730		1.193		1.119		1.067		1.050		1.002		1.008		1.001		1.005		1.000
2000		11.353		2.124		1.320		1.216		1.029		1.016		1.000		1.000		1.000		1.000
2001		6.408		1.694		1.391		1.088		1.056		1.086		1.109		1.004		1.004
2002		3.933		1.831		1.694		1.092		1.023		1.144		1.182		1.013
2003		5.654		1.611		1.273		1.148		1.066		1.136		1.041
2004		8.561		1.805		1.205		1.210		1.123		1.090
2005		61.125		2.317		1.404		1.280		1.251
2006		4.194		3.411		1.693		1.278
2007		5.744		1.951		1.177
2008		4.385		1.639
2009		2.821
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	9.694	1.822	1.303	1.131	1.073	1.058	1.033	1.003	1.001	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	15.654	2.225	1.350	1.202	1.104	1.095	1.067	1.005	1.001	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	6.407	1.763	1.296	1.129	1.062	1.055	1.019	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	4.774	2.024	1.294	1.212	1.082	1.104	1.051	1.004	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	5.215	1.819	1.307	1.179	1.111	1.085	1.051	1.005	1.001	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	5.136	2.022	1.300	1.209	1.127	1.102	1.062	1.006	1.001	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 3	4.083	2.028	1.351	1.253	1.153	1.117	1.091	1.007	1.002	1.003	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Contr Assumed		5.423		2.079		1.702		1.229		1.149		1.113		1.075		1.048		1.038		1.007		1.007		1.009		1.008		1.005		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000
Selected		5.215		2.022		1.300		1.209		1.127		1.102		1.062		1.048		1.038		1.007		1.007		1.009		1.008		1.005		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		24.761		4.748		2.348		1.806		1.494		1.326		1.203		1.133		1.081		1.041		1.034		1.027		1.018		1.010		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		42.221		7.175		2.800		1.928		1.567		1.366		1.233		1.150		1.094		1.051		1.036		1.029		1.020		1.012		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit A12

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

																			Indicated
							Cumulative Paid ALAE						Indicated Ultimate						Ultimate
	Paid ALAE ($000s)						Development Factors						Paid ALAE ($000s)						ALAE
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		3		3		3		1.000		1.000		1.000		3		3		3		3
1990		0		0		0		1.000		1.000		1.000		0		0		0		0
1991		0		0		0		1.001		1.000		1.000		0		0		0		0
1992		0		0		0		1.002		1.001		1.000		0		0		0		0
1993		0		0		0		1.003		1.002		1.001		0		0		0		0
1994		4		4		4		1.005		1.003		1.002		4		4		4		4
1995		27		27		27		1.010		1.005		1.004		27		27		27		27
1996		498		498		498		1.018		1.010		1.006		507		503		501		501
1997		311		311		311		1.027		1.018		1.012		319		317		315		315
1998		396		396		396		1.034		1.027		1.020		409		407		404		404
1999		1,152		1,158		1,158		1.041		1.034		1.029		1,199		1,197		1,192		1,192
2000		688		688		688		1.081		1.041		1.036		744		716		713		713
2001		1,024		1,028		1,031		1.133		1.081		1.051		1,160		1,111		1,084		1,084
2002		935		1,105		1,116		1.203		1.133		1.094		1,125		1,252		1,221		1,221
2003		1,803		2,048		2,111		1.326		1.203		1.150		2,391		2,464		2,428		2,428
2004		1,848		2,076		2,215		1.494		1.326		1.233		2,761		2,753		2,731		2,731
2005		1,591		2,037		2,409		1.806		1.494		1.366		2,873		3,043		3,291		3,291
2006		515		872		1,048		2.348		1.806		1.567		1,209		1,575		1,642		1,642
2007		695		1,356		1,532		4.748		2.348		1.928		3,300		3,184		2,954		2,954
2008		91		399		578		24.761		4.748		2.800		2,253		1,894		1,618		1,618
2009				181		394				24.761		7.175				4,482		2,827		2,827
2010						102						42.221						4,307		3,230

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit A13

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE / Paid Loss +1*
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.375		1.375		1.375		1.375		1.375		1.375		1.375		1.375
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994																1.190		1.190		1.167		1.167		1.167		1.167		1.167		1.167		1.167		1.167
1995				1.563		2.313		2.688		2.688		2.688		2.688		2.500		2.421		2.421		2.421		2.421		2.421		2.421		2.421		2.421
1996		1.950		1.194		1.226		1.292		1.344		1.410		1.411		1.411		1.412		1.412		1.412		1.412		1.412		1.412		1.412
1997		1.101		1.152		1.173		1.185		1.187		1.183		1.179		1.179		1.180		1.180		1.180		1.180		1.180		1.180
1998		1.066		1.106		1.115		1.130		1.141		1.142		1.145		1.146		1.145		1.145		1.145		1.145		1.145
1999		1.086		1.075		1.112		1.120		1.132		1.138		1.141		1.142		1.143		1.143		1.144		1.144
2000		1.065		1.100		1.114		1.113		1.134		1.135		1.136		1.136		1.136		1.136		1.136
2001		1.015		1.037		1.056		1.066		1.072		1.074		1.079		1.088		1.088		1.089
2002		1.029		1.036		1.050		1.076		1.078		1.076		1.087		1.101		1.102
2003		1.043		1.056		1.067		1.069		1.071		1.071		1.075		1.078
2004		1.026		1.036		1.047		1.052		1.056		1.061		1.055
2005		1.009		1.063		1.044		1.052		1.064		1.070
2006		1.018		1.019		1.033		1.052		1.061
2007		1.020		1.061		1.086		1.091
2008		1.023		1.033		1.038
2009		1.030		1.024
2010		1.014

* Excludes Constar in 2007. Last Diagonal is as of 9/30/10.

	Paid ALAE / Paid Loss + 1 Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.375		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994																1.000		0.980		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995				1.480		1.162		1.000		1.000		1.000		0.930		0.968		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		0.612		1.027		1.054		1.040		1.049		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.047		1.018		1.011		1.002		0.997		0.997		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		1.037		1.008		1.013		1.010		1.002		1.002		1.000		1.000		1.000		1.000		1.000		1.000
1999		0.990		1.034		1.007		1.011		1.005		1.003		1.000		1.001		1.000		1.001		1.000
2000		1.033		1.012		0.999		1.019		1.001		1.001		1.000		1.000		1.000		1.000
2001		1.022		1.018		1.009		1.005		1.002		1.005		1.008		1.000		1.000
2002		1.007		1.013		1.024		1.002		0.998		1.010		1.013		1.001
2003		1.012		1.010		1.002		1.002		1.000		1.004		1.003
2004		1.009		1.011		1.004		1.004		1.005		0.992
2005		1.053		0.983		1.007		1.012		1.007
2006		1.001		1.013		1.018		1.012
2007		1.040		1.023		1.007
2008		1.009		1.007
2009		0.992
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	0.990	1.044	1.023	1.009	1.005	1.001	0.996	0.997	0.998	1.000	1.000	1.000	1.000	1.063	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	1.019	1.007	1.008	1.006	1.002	1.003	1.005	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	1.017	1.015	1.013	1.007	1.002	1.001	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	1.017	1.010	1.006	1.006	1.002	1.003	1.004	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Contr Assumed		1.010		1.015		1.019		1.011		1.009		1.006		1.004		1.003		1.003		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Selected		1.017		1.015		1.013		1.006		1.005		1.003		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		1.071		1.053		1.037		1.024		1.018		1.013		1.010		1.008		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		1.091		1.057		1.041		1.027		1.020		1.014		1.011		1.009		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit A14

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	Paid ALAE /		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
	Ratio		Factors for		Ratio
Accident Year	@9/30/10		9/10-Ult		@9/30/10
1989		1.375		1.000		1.375
1990
1991
1992		1.000		1.000		1.000
1993		1.000		1.000		1.000
1994		1.167		1.000		1.167
1995		2.421		1.000		2.421
1996		1.412		1.000		1.412
1997		1.180		1.000		1.180
1998		1.145		1.001		1.147
1999		1.144		1.002		1.146
2000		1.136		1.003		1.139
2001		1.089		1.005		1.094
2002		1.102		1.007		1.110
2003		1.078		1.009		1.087
2004		1.055		1.011		1.067
2005		1.070		1.014		1.085
2006		1.061		1.020		1.082
2007		1.091		1.027		1.121
2008		1.038		1.041		1.080
2009		1.024		1.057		1.083
2010		1.014		1.091		1.106

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Direct Business
Exhibit A15

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

					Selected						Selected		Ultimate
			Paid ALAE to		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident	Paid ALAE		Paid Loss		Losses		Projection		Projection		ALAE*		Ultimate Loss
Year	($000s)		Ratio		($000s)		($000s)		($000s)		($000s)		Ratio
1989		3		0.375		8		3		3		3		0.375
1990		0				0		0		0		0
1991		0				0		0		0		0
1992		0		0.000		1		0		0		0		0.000
1993		0		0.000		20		0		0		0		0.000
1994		4		0.167		24		4		4		4		0.167
1995		27		1.421		19		27		27		27		1.421
1996		498		0.412		1,208		498		501		498		0.412
1997		311		0.180		1,728		311		315		311		0.180
1998		396		0.147		2,723		400		404		396		0.145
1999		1,158		0.146		8,066		1,178		1,192		1,158		0.144
2000		688		0.139		5,063		704		713		688		0.136
2001		1,031		0.094		11,632		1,093		1,084		1,031		0.089
2002		1,116		0.110		10,951		1,205		1,221		1,116		0.102
2003		2,111		0.087		27,958		2,432		2,428		2,430		0.087
2004		2,215		0.067		44,917		3,009		2,731		2,870		0.064
2005		2,409		0.085		40,069		3,406		3,291		3,349		0.084
2006		1,048		0.082		19,749		1,619		1,642		1,631		0.083
2007		1,532		0.121		31,663		3,831		2,954		3,393		0.107
2008		578		0.080		43,925		3,514		1,618		2,566		0.058
2009		394		0.083		65,658		5,450		2,827		4,139		0.063
2010		102		0.106		42,593		4,515		3,230		3,194		0.075
Total		15,621				357,975		33,199		26,185		28,804

* Selected Ultimate ALAE for the 2010 year reflects exposure as of 9/30/10 and is based on an ALAE to Loss Ratio of 7.5%, which is the weighted average ratio of 2001-2009.

Milliman

WSC Direct Business
Exhibit A16

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		3		3		0
1990		0		0		0
1991		0		0		0
1992		0		0		0
1993		0		0		0
1994		4		4		0
1995		27		27		0
1996		498		498		0
1997		311		311		0
1998		396		396		0
1999		1,158		1,158		0
2000		688		688		0
2001		1,031		1,031		0
2002		1,116		1,116		0
2003		2,430		2,111		319
2004		2,870		2,215		655
2005		3,349		2,409		940
2006		1,631		1,048		583
2007		3,393		1,532		1,861
2008		2,566		578		1,988
2009		4,139		394		3,745
2010		3,194		102		3,092
Total		28,804		15,621		13,183

Milliman

WSC Direct Business
Exhibit A17

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE* ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		11		11		11		0		0		0
1990		0		0		0		0		0		0
1991		0		0		0		0		0		0
1992		1		1		1		0		0		0
1993		20		20		20		0		0		0
1994		28		28		28		0		0		0
1995		46		46		46		0		0		0
1996		1,706		1,706		1,706		0		0		0
1997		2,039		2,039		2,039		0		0		0
1998		3,119		3,119		3,119		0		0		0
1999		9,224		9,224		9,224		0		0		0
2000		5,751		5,751		5,751		0		0		0
2001		12,663		12,663		12,663		0		0		0
2002		12,067		12,067		12,067		0		0		0
2003		30,388		29,281		29,254		27		1,107		1,134
2004		47,787		46,079		42,389		3,690		1,708		5,398
2005		43,418		41,086		36,938		4,148		2,332		6,480
2006		21,380		19,679		18,207		1,472		1,701		3,173
2007		35,056		19,145		18,355		790		15,911		16,701
2008		46,491		18,539		15,829		2,710		27,952		30,662
2009		69,797		34,226		16,585		17,641		35,571		53,212
2010		45,787		10,655		7,498		3,157		35,132		38,289
Total		386,779		265,365		231,730		33,635		121,414		155,049

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit B1

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Loss Salvage & Subrogation Recovered* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1993		0		6		6		19		19		19		19		19		19		19		19		19		19		19		19		19		19		19
1994		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1995		0		0		3		7		7		7		7		7		7		7		9		9		9		9		9		9
1996		4		196		200		315		321		321		321		321		321		321		321		321		321		321		321
1997		45		130		317		331		346		382		577		577		577		577		577		577		577		577
1998		280		757		895		1,212		1,242		1,283		1,328		1,328		1,328		1,328		1,328		1,328		1,328
1999		1,085		1,900		2,324		2,417		2,549		2,694		2,918		2,979		3,028		3,082		3,095		3,098
2000		43		721		938		1,192		1,298		1,312		1,397		1,406		1,406		1,406		1,406
2001		185		1,763		2,195		2,260		2,299		2,513		2,574		2,602		2,670		2,705
2002		77		1,024		1,313		1,671		1,839		2,010		2,204		2,392		2,479
2003		368		1,909		3,178		6,792		8,321		9,187		9,924		9,981
2004		10		1,569		4,887		5,803		6,850		7,506		14,060
2005		440		2,169		5,699		10,994		13,147		13,450
2006		576		3,389		4,389		7,122		7,598
2007		528		1,631		2,933		3,746
2008		108		2,835		4,707
2009		543		1,521
2010		1,831

* Excludes Constar in 2007. Last diagonal is as of 9/30/10.

Accident	Salvage & Subrogation Recovered Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990																																		1.000		1.000		1.000		1.000
1991
1992
1993				1.000		3.167		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994
1995						2.333		1.000		1.000		1.000		1.000		1.000		1.000		1.286		1.000		1.000		1.000		1.000		1.000
1996		49.000		1.020		1.575		1.019		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		2.889		2.438		1.044		1.045		1.104		1.510		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		2.704		1.182		1.354		1.025		1.033		1.035		1.000		1.000		1.000		1.000		1.000		1.000
1999		1.751		1.223		1.040		1.055		1.057		1.083		1.021		1.016		1.018		1.004		1.001
2000		16.767		1.301		1.271		1.089		1.011		1.065		1.006		1.000		1.000		1.000
2001		9.530		1.245		1.030		1.017		1.093		1.024		1.011		1.026		1.018
2002		13.299		1.282		1.273		1.101		1.093		1.097		1.085		1.049
2003		5.188		1.665		2.137		1.225		1.104		1.080		1.008
2004		156.900		3.115		1.187		1.180		1.096		2.309
2005		4.930		2.627		1.929		1.196		1.031
2006		5.884		1.295		1.623		1.090
2007		3.089		1.798		1.386
2008		26.250		1.966
2009		3.947

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Average		21.580		1.654		1.596		1.080		1.052		1.184		1.012		1.009		1.004		1.036		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		11.956		1.587		1.513		1.074		1.052		1.089		1.005		1.005		1.003		1.001		1.000		1.000		1.000		1.000
Col Sum		5.159		1.743		1.510		1.146		1.067		1.417		1.017		1.020		1.011		1.002		1.001		1.000		1.000		1.000		1.000		1.037		1.000		1.000		1.000		1.000
Selected		5.159		1.743		1.510		1.146		1.067		1.089		1.017		1.020		1.011		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		19.037		3.690		2.117		1.402		1.223		1.146		1.052		1.034		1.014		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		33.873		5.561		2.432		1.554		1.265		1.165		1.075		1.038		1.019		1.006		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit B2

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Loss Salvage & Subrogation Recovered Development Projection Method* ($000s)

	(1)		(2)		(3)
					[(1)*(2)]
					Projected
					Ultimate
			Cumulative		Loss
	Sal/Sub		Development		Sal/Sub
Accident	Recovered		Factors		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10
1989		8		1.000		8
1990		1		1.000		1
1991		0		1.000		0
1992		0		1.000		0
1993		19		1.000		19
1994		0		1.000		0
1995		9		1.000		9
1996		321		1.000		321
1997		577		1.000		577
1998		1,328		1.000		1,328
1999		3,098		1.000		3,098
2000		1,406		1.002		1,409
2001		2,705		1.006		2,721
2002		2,479		1.019		2,526
2003		9,981		1.038		10,360
2004		14,060		1.075		15,115
2005		13,450		1.165		15,669
2006		7,598		1.265		9,611
2007		3,746		1.554		5,821
2008		4,707		2.432		11,447
2009		1,521		5.561		8,458
2010		1,831		33.873		46,516
Total		68,845				135,014

*	Excludes Constar in the 2007 year.
Note:	The 9-Ult Cumulative Development Factor was interpolated using curve fitting methods. The Projected Ultimate Sal/Sub for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit B3

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Paid Loss* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1		1		1		1		1
1993		0		19		19		19		19		19		19		19		19		20		20		20		20		20		20		20		20		20
1994		0		0		0		0		0		0		0		21		21		24		24		24		24		24		24		24		24
1995		0		16		16		16		16		16		16		18		19		19		19		19		19		19		19		19
1996		20		1,062		1,096		1,161		1,161		1,207		1,209		1,209		1,209		1,208		1,208		1,208		1,208		1,208		1,208
1997		139		1,242		1,512		1,514		1,514		1,550		1,733		1,733		1,728		1,728		1,728		1,728		1,728		1,728
1998		1,054		2,207		2,637		2,730		2,733		2,730		2,734		2,726		2,723		2,723		2,723		2,723		2,723
1999		1,989		5,842		6,795		7,581		7,691		7,887		8,066		8,066		8,066		8,066		8,066		8,066
2000		260		1,929		3,606		4,782		4,897		5,013		5,063		5,063		5,063		5,063		5,063
2001		3,273		8,413		9,472		11,180		11,196		11,556		11,618		11,632		11,632		11,632
2002		2,093		6,551		8,652		9,682		10,286		10,751		10,751		10,951		10,951
2003		2,953		12,818		17,392		21,452		23,868		25,429		27,138		27,143
2004		3,110		19,666		26,771		29,354		32,860		33,883		40,174
2005		879		7,816		25,586		30,746		31,673		34,529
2006		1,984		7,880		15,744		16,846		17,159
2007		6,019		11,318		15,811		16,823
2008		3,944		12,234		15,251
2009		6,004		16,191
2010		7,396

* Excludes Constar in 2007. Last diagonal is as of 9/30/10.

Milliman

WSC Direct Business
Exhibit B4

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Loss*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1991		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1992		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
1993		N/A		0.316		0.316		1.000		1.000		1.000		1.000		1.000		1.000		0.950		0.950		0.950		0.950		0.950		0.950		0.950		0.950		0.950
1994		N/A		N/A		N/A		N/A		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
1995		N/A		0.000		0.188		0.438		0.438		0.438		0.438		0.389		0.368		0.368		0.474		0.474		0.474		0.474		0.474		0.474
1996		0.200		0.185		0.182		0.271		0.276		0.266		0.266		0.266		0.266		0.266		0.266		0.266		0.266		0.266		0.266
1997		0.324		0.105		0.210		0.219		0.229		0.246		0.333		0.333		0.334		0.334		0.334		0.334		0.334		0.334
1998		0.266		0.343		0.339		0.444		0.454		0.470		0.486		0.487		0.488		0.488		0.488		0.488		0.488
1999		0.546		0.325		0.342		0.319		0.331		0.342		0.362		0.369		0.375		0.382		0.384		0.384
2000		0.165		0.374		0.260		0.249		0.265		0.262		0.276		0.278		0.278		0.278		0.278
2001		0.057		0.210		0.232		0.202		0.205		0.217		0.222		0.224		0.230		0.233
2002		0.037		0.156		0.152		0.173		0.179		0.187		0.205		0.218		0.226
2003		0.125		0.149		0.183		0.317		0.349		0.361		0.366		0.368
2004		0.003		0.080		0.183		0.198		0.208		0.222		0.350
2005		0.501		0.278		0.223		0.358		0.415		0.390
2006		0.290		0.430		0.279		0.423		0.443
2007		0.088		0.144		0.186		0.223
2008		0.027		0.232		0.309
2009		0.090		0.094
2010		0.248
*   Excludes Constar in 2007. Last diagonal is as of 9/30/10.
Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992
1993				1.000		3.167		1.000		1.000		1.000		1.000		1.000		0.950		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994
1995						2.333		1.000		1.000		1.000		0.889		0.947		1.000		1.286		1.000		1.000		1.000		1.000		1.000
1996		0.923		0.989		1.487		1.019		0.962		0.998		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000
1997		0.323		2.003		1.043		1.045		1.078		1.351		1.000		1.003		1.000		1.000		1.000		1.000		1.000
1998		1.291		0.990		1.308		1.024		1.034		1.034		1.003		1.001		1.000		1.000		1.000		1.000
1999		0.596		1.052		0.932		1.040		1.031		1.059		1.021		1.016		1.018		1.004		1.001
2000		2.260		0.696		0.958		1.063		0.987		1.054		1.006		1.000		1.000		1.000
2001		3.707		1.106		0.872		1.016		1.059		1.019		1.010		1.026		1.018
2002		4.249		0.971		1.137		1.036		1.046		1.097		1.065		1.049
2003		1.195		1.227		1.733		1.101		1.036		1.012		1.007
2004		24.812		2.288		1.083		1.054		1.063		1.840
2005		0.554		0.803		1.605		1.161		0.919
2006		1.481		0.648		1.517		1.064
2007		1.643		1.287		1.276
2008		8.462		1.465
2009		1.052
**   Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		3.754		1.180		1.461		1.048		1.018		1.122		1.000		1.004		0.998		1.036		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		2.285		1.132		1.368		1.042		1.022		1.063		1.005		1.006		1.003		1.001		1.000		1.000		1.000		1.000
Avg L5 x H/L		1.392		1.185		1.466		1.073		1.047		1.057		1.013		1.015		1.006		1.000		1.000		1.000
Selected		2.285		1.185		1.466		1.073		1.047		1.063		1.013		1.006		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		4.846		2.121		1.790		1.221		1.138		1.087		1.023		1.010		1.004		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		N/A		2.608		1.868		1.344		1.158		1.100		1.039		1.013		1.006		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit B5

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Loss* ($000s)

	(1)		(2)		(3)		(4)		(5)
									[(3) * (4)]
									Projected
			Cumulative		[(1)*(2)]				Ultimate
			Ratio		Projected		Gross		Loss
			Development		Ultimate		Ultimate		Sal/Sub
Accident	Ratio		Factors		Ratio		Loss		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1989		1.000		1.000		1.000		8		8
1990		N/A		1.000		0.000		0		0
1991		N/A		1.000		0.000		0		0
1992		0.000		1.000		0.000		1		0
1993		0.950		1.000		0.950		20		19
1994		0.000		1.000		0.000		24		0
1995		0.474		1.000		0.474		19		9
1996		0.266		1.000		0.266		1,208		321
1997		0.334		1.000		0.334		1,728		577
1998		0.488		1.000		0.488		2,723		1,329
1999		0.384		1.000		0.384		8,066		3,097
2000		0.278		1.000		0.278		5,063		1,408
2001		0.233		1.002		0.233		11,632		2,710
2002		0.226		1.006		0.228		10,951		2,497
2003		0.368		1.013		0.372		27,958		10,400
2004		0.350		1.039		0.364		44,917		16,350
2005		0.390		1.100		0.428		40,069		17,150
2006		0.443		1.158		0.513		19,749		10,131
2007		0.223		1.344		0.299		31,663		9,467
2008		0.309		1.868		0.577		43,925		25,345
2009		0.094		2.608		0.245		65,658		16,086
2010		0.248		N/A		N/A		42,593		N/A
Total								357,975		116,904

* Excludes Constar in the 2007 year.

Milliman

WSC Direct Business
Exhibit B6

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Bornhuetter — Ferguson Projection* ($000s)

	2006		2007		2008		2009
1) A-Priori Salvage & Subrogation Ratio at 9/30/10**		0.330		0.330		0.330		0.330
2) Selected Ultimate Loss at 9/30/10		19,749		31,663		43,925		65,658
3) A-Priori Ultimate Salvage & Subrogation at 9/30/10 (1) x (2)		6,517		10,449		14,495		21,667
4) Estimated % Unrecovered [1-1/CDF]		0.209		0.356		0.589		0.820
5) Estimated Future Salvage & Subrogation Recoverables at 9/30/10 (3) x (4)		1,362		3,720		8,538		17,767
6) Actual Salvage & Subrogation Recovered to Date		7,598		3,746		4,707		1,521
7) Indicated Ultimate Salvage & Subrogation (5) + (6)		8,960		7,466		13,245		19,288

*	Excludes Constar in the 2007 year.
**	Based on the average Salvage & Subrogation Ratios for 1996-2005.

Milliman

WSC Direct Business
Exhibit B7

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Selection of Ultimate Loss Salvage & Subrogation* ($000s)

			Ultimate		Ultimate		Ultimate
			Sal/Sub		Sal/Sub		Sal/Sub				Selected
	Gross		Indicated by		Indicated by		Indicated by				Ultimate
	Ultimate		Dollar		Ratio		Bornhuetter-		Selected		Sal/Sub
Accident	Loss		Development		Development		Ferguson		Ultimate		to Ultimate
Year	@9/30/10		Method		Method		Method		Sal/Sub		Loss Ratio
1989		8		8		8	xxx			8		1.000
1990		0		1		0	xxx			1		N/A
1991		0		0		0	xxx			0		N/A
1992		1		0		0	xxx			0		0.000
1993		20		19		19	xxx			19		0.950
1994		24		0		0	xxx			0		0.000
1995		19		9		9	xxx			9		0.474
1996		1,208		321		321	xxx			321		0.266
1997		1,728		577		577	xxx			577		0.334
1998		2,723		1,328		1,329	xxx			1,328		0.488
1999		8,066		3,098		3,097	xxx			3,098		0.384
2000		5,063		1,409		1,408	xxx			1,406		0.278
2001		11,632		2,721		2,710	xxx			2,705		0.233
2002		10,951		2,526		2,497	xxx			2,479		0.226
2003		27,958		10,360		10,400	xxx			10,360		0.371
2004		44,917		15,115		16,350	xxx			15,115		0.337
2005		40,069		15,669		17,150	xxx			14,560		0.363
2006		19,749		9,611		10,131		8,960		8,960		0.454
2007		31,663		5,821		9,467		7,466		6,644		0.210
2008		43,925		11,447		25,345		13,245		12,346		0.281
2009		65,658		8,458		16,086		19,288		14,611		0.223
2010		42,593		46,516		N/A	xxx			10,137		0.238
Total		357,975		135,014		116,904				104,684		0.292

* Excludes Constar in the 2007 year.

Note: Ultimate Salvage & Subrogation for 2010 is based on an Ultimate Sal/Sub Ratio of 23.8%, which is the weighted average of 2007-2009.

Milliman

WSC Direct Business
Exhibit B8

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation* ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		8		8		0
1990		1		1		0
1991		0		0		0
1992		0		0		0
1993		19		19		0
1994		0		0		0
1995		9		9		0
1996		321		321		0
1997		577		577		0
1998		1,328		1,328		0
1999		3,098		3,098		0
2000		1,406		1,406		0
2001		2,705		2,705		0
2002		2,479		2,479		0
2003		10,360		9,981		379
2004		15,115		14,060		1,055
2005		14,560		13,450		1,110
2006		8,960		7,598		1,362
2007		6,644		3,746		2,898
2008		12,346		4,707		7,639
2009		14,611		1,521		13,090
2010		10,137		1,831		8,306
Total		104,684		68,845		35,839

* Excludes Constar in the 2007 year.

Milliman

WSC Direct Business
Exhibit C1

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1		1		1		1		1
1993		0		9		9		9		9		9		9		9		9		10		10		10		10		10		10		10		10		10
1994		0		0		0		0		0		0		0		21		21		24		24		24		24		24		24		24		24
1995		0		4		4		4		4		4		4		6		7		7		7		7		7		7		7		7
1996		0		0		0		0		0		0		2		2		2		2		2		2		2		2		2
1997		0		0		0		0		0		0		3		3		3		3		3		3		3		3
1998		0		0		0		0		1		1		5		5		5		5		5		5		5
1999		0		0		0		5		24		24		44		44		44		44		44		44
2000		14		1,047		1,544		1,689		1,738		1,738		1,788		1,788		1,788		1,788		1,788
2001		2,960		7,149		7,876		9,578		9,594		9,944		9,977		9,991		9,991		9,991
2002		1,263		4,929		6,853		7,883		8,487		8,952		8,952		9,152		9,152
2003		2,691		12,273		16,619		20,555		22,819		24,380		26,089		26,094
2004		2,992		18,433		25,092		27,375		27,734		28,139		34,430
2005		879		7,658		25,208		30,368		31,295		31,749
2006		1,827		7,611		14,252		15,323		15,633
2007		5,360		10,850		15,582		16,631
2008		3,939		11,823		14,676
2009		6,004		16,191
2010		7,396
*   Excludes Constar in 2007. Last Diagonal is as of 9/30/10.
	Paid Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.111		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994																1.000		1.143		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995				1.000		1.000		1.000		1.000		1.000		1.500		1.167		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996														1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997														1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998										1.000		5.000		1.000		1.000		1.000		1.000		1.000		1.000
1999								4.800		1.000		1.833		1.000		1.000		1.000		1.000		1.000
2000		74.786		1.475		1.094		1.029		1.000		1.029		1.000		1.000		1.000		1.000
2001		2.415		1.102		1.216		1.002		1.036		1.003		1.001		1.000		1.000
2002		3.903		1.390		1.150		1.077		1.055		1.000		1.022		1.000
2003		4.561		1.354		1.237		1.110		1.068		1.070		1.000
2004		6.161		1.361		1.091		1.013		1.015		1.309
2005		8.712		3.292		1.205		1.031		1.019
2006		4.166		1.873		1.075		1.027
2007		2.024		1.436		1.091
2008		3.002		1.334
2009		3.754
2010
**   Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		11.348		1.511		1.116		1.409		1.019		1.524		1.048		1.015		1.025		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5		4.331		1.859		1.140		1.051		1.039		1.082		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		4.584		1.369		1.115		1.036		1.016		1.156		1.003		1.000		1.014		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		3.640		1.557		1.129		1.045		1.037		1.034		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs		3.735		1.575		1.148		1.041		1.033		1.143		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5		3.358		1.701		1.143		1.045		1.034		1.143		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 3		2.954		1.506		1.139		1.023		1.031		1.169		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected		3.358		1.701		1.139		1.045		1.034		1.015		1.011		1.005		1.006		1.005		1.004		1.003		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.003
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		7.488		2.230		1.311		1.151		1.101		1.065		1.049		1.038		1.033		1.027		1.022		1.018		1.015		1.013		1.011		1.009		1.008		1.007		1.006		1.005		1.004		1.003
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		11.434		3.019		1.497		1.189		1.113		1.074		1.053		1.041		1.034		1.029		1.023		1.019		1.016		1.014		1.012		1.010		1.008		1.007		1.006		1.005		1.004		1.003

Milliman

WSC Direct Business
Exhibit C2

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection*

																			Indicated
							Cumulative Paid Loss						Indicated Ultimate						Ultimate
	Paid Losses ($000s)						Development Factors						Paid Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		8		8		8		1.005		1.004		1.003		8		8		8		8
1990		0		0		0		1.006		1.005		1.004		0		0		0		0
1991		0		0		0		1.007		1.006		1.005		0		0		0		0
1992		1		1		1		1.008		1.007		1.006		1		1		1		1
1993		10		10		10		1.009		1.008		1.007		10		10		10		10
1994		24		24		24		1.011		1.009		1.008		24		24		24		24
1995		7		7		7		1.013		1.011		1.010		7		7		7		7
1996		2		2		2		1.015		1.013		1.012		2		2		2		2
1997		3		3		3		1.018		1.015		1.014		3		3		3		3
1998		5		5		5		1.022		1.018		1.016		5		5		5		5
1999		44		44		44		1.027		1.022		1.019		45		45		45		45
2000		1,788		1,788		1,788		1.033		1.027		1.023		1,847		1,836		1,829		1,829
2001		9,991		9,991		9,991		1.038		1.033		1.029		10,371		10,321		10,281		10,281
2002		8,952		9,152		9,152		1.049		1.038		1.034		9,391		9,500		9,463		9,463
2003		24,380		26,089		26,094		1.065		1.049		1.041		25,965		27,367		27,164		27,164
2004		27,734		28,139		34,430		1.101		1.065		1.053		30,535		29,968		36,255		36,255
2005		30,368		31,295		31,749		1.151		1.101		1.074		34,954		34,456		34,098		34,098
2006		14,252		15,323		15,633		1.311		1.151		1.113		18,684		17,637		17,400		17,400
2007		10,850		15,582		16,631		2.230		1.311		1.189		24,196		20,428		19,774		19,774
2008		3,939		11,823		14,676		7.488		2.230		1.497		29,495		26,365		21,970		21,970
2009				6,004		16,191				7.488		3.019				44,958		48,881		48,881
2010						7,396						11.434						84,566		63,425

*	Excludes Constar in 2007.
Note:	The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit C3

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Incurred Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		13		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1		1		1		1		1
1993		0		6		6		9		9		9		9		9		9		10		10		10		10		10		10		10		10		10
1994		4		6		0		0		0		0		0		21		21		24		24		24		24		24		24		24		24
1995		11		18		4		4		4		4		4		6		7		7		7		7		7		7		7		7
1996		0		0		0		0		0		0		2		2		2		2		2		2		2		2		2
1997		0		0		0		0		0		0		3		3		3		3		3		3		3		3
1998		0		0		0		0		1		1		8		5		5		5		5		5		5
1999		13		0		0		5		24		74		44		44		44		44		44		44
2000		14		1,135		2,062		2,111		2,160		2,152		1,896		1,788		1,788		1,788		1,788
2001		4,362		8,476		9,030		10,023		9,856		9,972		9,996		9,997		9,991		9,991
2002		1,383		6,676		7,933		8,727		9,151		9,256		9,054		9,152		9,152
2003		3,752		15,376		21,099		24,285		25,314		25,492		26,134		26,102
2004		6,014		22,919		28,513		28,560		29,210		28,697		34,943
2005		1,629		12,077		28,574		32,726		32,912		33,138
2006		1,990		10,316		15,411		16,876		17,069
2007		6,077		12,929		16,729		17,420
2008		5,842		13,646		17,356
2009		15,335		33,832
2010		10,553
*  Excludes Constar in 2007. Last Diagonal is as of 9/30/10.
	Incurred Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.625		0.615		1.000		1.000		1.000		1.000		1.000
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.500		1.000		1.000		1.000		1.000		1.000		1.111		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		1.500		0.000												1.000		1.143		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		1.636		0.222		1.000		1.000		1.000		1.000		1.500		1.167		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996														1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997														1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998										1.000		8.000		0.625		1.000		1.000		1.000		1.000		1.000
1999		0.000						4.800		3.083		0.595		1.000		1.000		1.000		1.000		1.000
2000		81.071		1.817		1.024		1.023		0.996		0.881		0.943		1.000		1.000		1.000
2001		1.943		1.065		1.110		0.983		1.012		1.002		1.000		0.999		1.000
2002		4.827		1.188		1.100		1.049		1.011		0.978		1.011		1.000
2003		4.098		1.372		1.151		1.042		1.007		1.025		0.998
2004		3.811		1.244		1.002		1.023		0.982		1.300
2005		7.414		2.366		1.145		1.006		1.009
2006		5.184		1.494		1.095		1.015
2007		2.128		1.294		1.055
2008		2.336		1.378
2009		2.872
2010
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		9.140		1.203		1.118		1.394		1.210		1.678		1.007		1.015		1.025		1.000		1.000		1.000		1.000		1.000		1.125		0.904		1.000		1.000		1.000		1.000		1.000
Latest 5		3.987		1.555		1.090		1.027		1.004		1.037		0.990		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		3.432		1.207		1.085		1.020		1.004		1.023		0.995		1.000		1.014		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		3.464		1.389		1.099		1.027		1.009		1.002		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs		3.180		1.430		1.090		1.020		1.002		1.116		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.100		0.896		1.000		1.000		1.000		1.000		1.000
Latest 5		3.013		1.503		1.089		1.023		1.002		1.117		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 3		2.591		1.381		1.108		1.014		1.000		1.143		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
Selected		3.013		1.503		1.089		1.031		1.020		1.009		1.005		1.003		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.000		1.001
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		5.348		1.775		1.181		1.085		1.052		1.031		1.022		1.017		1.014		1.012		1.011		1.010		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.001
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		7.882		2.338		1.308		1.108		1.060		1.036		1.024		1.018		1.015		1.013		1.011		1.010		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.001

Milliman

WSC Direct Business
Exhibit C4

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection*

																			Indicated
							Cumulative Incurred Loss						Indicated Ultimate						Ultimate
	Incurred Losses ($000s)						Development Factors						Incurred Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		8		8		8		1.002		1.001		1.001		8		8		8		8
1990		0		0		0		1.003		1.002		1.001		0		0		0		0
1991		0		0		0		1.004		1.003		1.002		0		0		0		0
1992		1		1		1		1.005		1.004		1.003		1		1		1		1
1993		10		10		10		1.006		1.005		1.004		10		10		10		10
1994		24		24		24		1.007		1.006		1.005		24		24		24		24
1995		7		7		7		1.008		1.007		1.006		7		7		7		7
1996		2		2		2		1.009		1.008		1.007		2		2		2		2
1997		3		3		3		1.010		1.009		1.008		3		3		3		3
1998		5		5		5		1.011		1.010		1.009		5		5		5		5
1999		44		44		44		1.012		1.011		1.010		45		44		44		44
2000		1,788		1,788		1,788		1.014		1.012		1.011		1,813		1,809		1,808		1,808
2001		9,997		9,991		9,991		1.017		1.014		1.013		10,167		10,131		10,121		10,121
2002		9,054		9,152		9,152		1.022		1.017		1.015		9,253		9,308		9,289		9,289
2003		25,492		26,134		26,102		1.031		1.022		1.018		26,282		26,709		26,572		26,572
2004		29,210		28,697		34,943		1.052		1.031		1.024		30,729		29,587		35,782		35,782
2005		32,726		32,912		33,138		1.085		1.052		1.036		35,508		34,623		34,331		34,331
2006		15,411		16,876		17,069		1.181		1.085		1.060		18,200		18,310		18,093		18,093
2007		12,929		16,729		17,420		1.775		1.181		1.108		22,949		19,757		19,301		19,301
2008		5,842		13,646		17,356		5.348		1.775		1.308		31,243		24,222		22,702		22,702
2009				15,335		33,832				5.348		2.338				82,012		79,099		79,099
2010						10,553						7.882						83,179		62,384

*	Excludes Constar in 2007.
Note:	The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit C5

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1989 — 2006 Ultimate Losses ($000s)

			Indicated Ultimate
			Losses Based on:
	Incurred				Incurred		Selected
Accident	Losses		Paid Loss		Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1989		8		8		8		8
1990		0		0		0		0
1991		0		0		0		0
1992		1		1		1		1
1993		10		10		10		10
1994		24		24		24		24
1995		7		7		7		7
1996		2		2		2		2
1997		3		3		3		3
1998		5		5		5		5
1999		44		45		44		44
2000		1,788		1,829		1,808		1,788
2001		9,991		10,281		10,121		9,991
2002		9,152		9,463		9,289		9,152
2003		26,102		27,164		26,572		26,868
2004		34,943		36,255		35,782		35,940
2005		33,138		34,098		34,331		34,331
2006		17,069		17,400		18,093		18,093
Total		132,287		136,595		136,100		136,267

Milliman

WSC Direct Business
Exhibit C6

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection* ($000s)

	Selected
	Ultimate		Net Earned
Accident	Losses		Premium		Net Loss Ratio
Year	@9/30/10		@9/30/10		@9/30/10
1994		24		223		10.8	%
1995		7		170		4.1	%
1996		2		132		1.5	%
1997		3		79		3.8	%
1998		5		100		5.0	%
1999		44		284		15.5	%
2000		1,788		8,796		20.3	%
2001		9,991		19,553		51.1	%
2002		9,152		32,836		27.9	%
2003		26,868		55,664		48.3	%
2004		35,940		88,126		40.8	%
2005		34,331		119,084		28.8	%
2006		18,093		152,421		11.9	%
Total		136,248		477,468		28.5	%
Total 02-06		124,384		448,131		27.8	%
Selected Loss Ratio						27.8	%

						Loss Ratio
Accident	Net Earned		Selected Loss			Projection
Year	Premium		Ratio			@9/30/10
2007		175,282		27.8	%		48,728
2008		179,864		27.8	%		50,002
2009		180,652		27.8	%		50,221
2010		137,034		27.8	%		38,095

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit C7

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection* ($000s)

	A’priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent					Losses		Ultimate
Year	Losses**		Unreported			Indicated IBNR		@9/30/10		Losses***
2007		48,728		9.7	%		4,727		17,420		22,147
2008		50,002		23.5	%		11,750		17,356		29,106
2009		50,221		57.2	%		28,726		33,832		62,558
2010		50,793		87.3	%		44,342		10,553		41,171
Total		199,744					89,545		79,161		154,982

*	Excludes Constar in 2007.
**	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit C8

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection* ($000s)

	A’priori		Estimated							Indicated
Accident	Ultimate		Percent			Indicated		Paid Losses		Ultimate
Year	Losses**		Unpaid			Unpaid		@9/30/10		Losses***
2007		48,728		15.9	%		7,748		16,631		24,379
2008		50,002		33.2	%		16,601		14,676		31,277
2009		50,221		66.9	%		33,598		16,191		49,789
2010		50,793		91.3	%		46,374		7,396		40,328
Total		199,744					104,321		54,894		145,773

*	Excludes Constar in 2007.
**	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit C9

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2007 — 2010 Ultimate Losses* ($000s)

					Indicated Ultimate Losses** Based on:										Selected
	Incurred						Incurred								Ultimate		Ultimate
Accident	Losses		Net Earned		Paid Loss		Loss		Incurred B/F		Paid B/F		Loss Ratio		Losses		Loss Ratio
Year	@9/30/10		Premium**		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2007		17,420		175,282		19,774		19,301		22,147		24,379		48,728		28,639		16.3	%
2008		17,356		179,864		21,970		22,702		29,106		31,277		50,002		39,554		22.0	%
2009		33,832		180,652		48,881		79,099		62,558		49,789		50,221		62,558		34.6	%
2010		10,553		137,034		63,425		62,384		41,171		40,328		38,095		39,633		28.9	%
Total		79,161		672,832		154,050		183,486		154,982		145,773		187,046		170,384		25.3	%

*	Excludes Constar in 2007.
**	Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Direct Business
Exhibit C10

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses* ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		8		8		8		0		0		0
1990		0		0		0		0		0		0
1991		0		0		0		0		0		0
1992		1		1		1		0		0		0
1993		10		10		10		0		0		0
1994		24		24		24		0		0		0
1995		7		7		7		0		0		0
1996		2		2		2		0		0		0
1997		3		3		3		0		0		0
1998		5		5		5		0		0		0
1999		44		44		44		0		0		0
2000		1,788		1,788		1,788		0		0		0
2001		9,991		9,991		9,991		0		0		0
2002		9,152		9,152		9,152		0		0		0
2003		26,868		26,102		26,094		8		766		774
2004		35,940		34,943		34,430		513		997		1,510
2005		34,331		33,138		31,749		1,389		1,193		2,582
2006		18,093		17,069		15,633		1,436		1,024		2,460
2007		28,639		17,420		16,631		789		11,219		12,008
2008		39,554		17,356		14,676		2,680		22,198		24,878
2009		62,558		33,832		16,191		17,641		28,726		46,367
2010		39,633		10,553		7,396		3,157		29,080		32,237
Total		306,651		211,448		183,835		27,613		95,203		122,816

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit C11

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		0		0		0		0		0		0		0		0		0		3		3		3		3		3		3		3		3
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1993		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1994		1		1		1		1		1		1		1		1		1		1		1		1		1		1		1		1		1
1995		0		1		1		1		1		1		1		1		1		1		1		1		1		1		1		1
1996		5		6		6		6		6		6		6		6		6		6		6		6		6		6		6
1997		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1998		0		0		0		0		0		0		0		0		0		0		0		0		0
1999		0		0		0		0		0		0		0		0		0		0		6		6
2000		1		102		241		304		351		363		367		367		367		367		367
2001		49		178		344		537		586		601		619		622		626		629
2002		24		168		344		641		707		724		842		1,012		1,023
2003		118		706		1,112		1,376		1,588		1,699		1,942		2,015
2004		81		680		1,160		1,364		1,580		1,774		1,899
2005		7		486		1,115		1,568		2,015		2,239
2006		32		141		461		801		967
2007		121		386		807		947
2008		91		397		576
2009		181		394
2010		102
*  Last Diagonal is as of 9/30/10.
	Paid ALAE Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989																														1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992
1993
1994		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		1.200		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997
1998
1999																						1.000
2000		102.000		2.363		1.261		1.155		1.034		1.011		1.000		1.000		1.000		1.000
2001		3.633		1.933		1.561		1.091		1.026		1.030		1.005		1.006		1.006
2002		7.000		2.048		1.863		1.103		1.024		1.163		1.202		1.015
2003		5.983		1.575		1.237		1.154		1.070		1.143		1.050
2004		8.395		1.706		1.176		1.158		1.123		1.095
2005		69.429		2.294		1.406		1.285		1.151
2006		4.406		3.270		1.738		1.285
2007		3.190		2.091		1.238
2008		4.363		1.643
2009		2.821
2010
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		17.785		1.827		1.316		1.123		1.047		1.055		1.037		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5		16.842		2.201		1.359		1.197		1.079		1.088		1.064		1.007		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		11.042		1.765		1.291		1.118		1.040		1.047		1.011		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		3.986		2.030		1.294		1.199		1.073		1.089		1.028		1.006		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs		5.291		1.920		1.359		1.192		1.096		1.107		1.072		1.009		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5		4.446		2.007		1.312		1.203		1.099		1.107		1.072		1.009		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 3		3.292		2.078		1.413		1.239		1.118		1.126		1.080		1.009		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
Selected		5.215		2.022		1.300		1.209		1.127		1.102		1.062		1.048		1.038		1.007		1.007		1.009		1.008		1.005		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		24.761		4.748		2.348		1.806		1.494		1.326		1.203		1.133		1.081		1.041		1.034		1.027		1.018		1.010		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		42.221		7.175		2.800		1.928		1.567		1.366		1.233		1.150		1.094		1.051		1.036		1.029		1.020		1.012		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit C12

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

																			Indicated
							Cumulative Paid ALAE						Indicated Ultimate						Ultimate
	Paid ALAE ($000s)						Development Factors						Paid ALAE ($000s)						ALAE
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		3		3		3		1.000		1.000		1.000		3		3		3		3
1990		0		0		0		1.000		1.000		1.000		0		0		0		0
1991		0		0		0		1.001		1.000		1.000		0		0		0		0
1992		0		0		0		1.002		1.001		1.000		0		0		0		0
1993		0		0		0		1.003		1.002		1.001		0		0		0		0
1994		1		1		1		1.005		1.003		1.002		1		1		1		1
1995		1		1		1		1.010		1.005		1.004		1		1		1		1
1996		6		6		6		1.018		1.010		1.006		6		6		6		6
1997		0		0		0		1.027		1.018		1.012		0		0		0		0
1998		0		0		0		1.034		1.027		1.020		0		0		0		0
1999		0		6		6		1.041		1.034		1.029		0		6		6		6
2000		367		367		367		1.081		1.041		1.036		397		382		380		380
2001		622		626		629		1.133		1.081		1.051		705		677		661		661
2002		842		1,012		1,023		1.203		1.133		1.094		1,013		1,147		1,119		1,119
2003		1,699		1,942		2,015		1.326		1.203		1.150		2,253		2,336		2,317		2,317
2004		1,580		1,774		1,899		1.494		1.326		1.233		2,361		2,352		2,341		2,341
2005		1,568		2,015		2,239		1.806		1.494		1.366		2,832		3,010		3,058		3,058
2006		461		801		967		2.348		1.806		1.567		1,082		1,447		1,515		1,515
2007		386		807		947		4.748		2.348		1.928		1,833		1,895		1,826		1,826
2008		91		397		576		24.761		4.748		2.800		2,253		1,885		1,613		1,613
2009				181		394				24.761		7.175				4,482		2,827		2,827
2010						102						42.221						4,307		3,230

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit C13

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE / Paid Loss +1*
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.375		1.375		1.375		1.375		1.375		1.375		1.375		1.375
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994																1.048		1.048		1.042		1.042		1.042		1.042		1.042		1.042		1.042		1.042
1995				1.250		1.250		1.250		1.250		1.250		1.250		1.167		1.143		1.143		1.143		1.143		1.143		1.143		1.143		1.143
1996														4.000		4.000		4.000		4.000		4.000		4.000		4.000		4.000		4.000
1997														1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998										1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1999								1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.136		1.136
2000		1.071		1.097		1.156		1.180		1.202		1.209		1.205		1.205		1.205		1.205		1.205
2001		1.017		1.025		1.044		1.056		1.061		1.060		1.062		1.062		1.063		1.063
2002		1.019		1.034		1.050		1.081		1.083		1.081		1.094		1.111		1.112
2003		1.044		1.058		1.067		1.067		1.070		1.070		1.074		1.077
2004		1.027		1.037		1.046		1.050		1.057		1.063		1.055
2005		1.008		1.063		1.044		1.052		1.064		1.071
2006		1.018		1.019		1.032		1.052		1.062
2007		1.023		1.036		1.052		1.057
2008		1.023		1.034		1.039
2009		1.030		1.024
2010		1.014
*   Excludes Constar in 2007. Last Diagonal is as of 9/30/10.
	Paid ALAE / Paid Loss + 1 Development Factors**
Accident Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.375		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992																						1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994																1.000		0.994		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995				1.000		1.000		1.000		1.000		1.000		0.933		0.980		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996														1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997														1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998										1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1999								1.000		1.000		1.000		1.000		1.000		1.000		1.136		1.000
2000		1.024		1.053		1.021		1.019		1.006		0.997		1.000		1.000		1.000		1.000
2001		1.008		1.018		1.012		1.005		0.999		1.002		1.000		1.000		1.000
2002		1.015		1.016		1.030		1.002		0.998		1.012		1.015		1.001
2003		1.013		1.009		1.000		1.002		1.000		1.004		1.003
2004		1.010		1.009		1.003		1.007		1.006		0.990
2005		1.055		0.982		1.007		1.012		1.008
2006		1.001		1.014		1.019		1.012
2007		1.013		1.016		1.007
2008		1.010		1.007
2009		0.992
2010
**   Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		1.014		1.011		1.010		1.006		1.002		1.001		0.996		0.998		0.999		1.015		1.000		1.000		1.000		1.063		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5		1.014		1.005		1.007		1.007		1.002		1.001		1.004		1.000		1.000		1.027		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		1.012		1.010		1.009		1.005		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		1.008		1.010		1.006		1.007		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
Selected		1.017		1.015		1.013		1.006		1.005		1.003		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		1.071		1.053		1.037		1.024		1.018		1.013		1.010		1.008		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		1.091		1.057		1.041		1.027		1.020		1.014		1.011		1.009		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit C14

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	Paid ALAE /		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
	Ratio		Factors for		Ratio
Accident Year	@9/30/10		9/10-Ult		@9/30/10
1989		1.375		1.000		1.375
1990
1991
1992		1.000		1.000		1.000
1993		1.000		1.000		1.000
1994		1.042		1.000		1.042
1995		1.143		1.000		1.143
1996		4.000		1.000		4.000
1997		1.000		1.000		1.000
1998		1.000		1.001		1.001
1999		1.136		1.002		1.139
2000		1.205		1.003		1.209
2001		1.063		1.005		1.068
2002		1.112		1.007		1.120
2003		1.077		1.009		1.087
2004		1.055		1.011		1.067
2005		1.071		1.014		1.086
2006		1.062		1.020		1.083
2007		1.057		1.027		1.085
2008		1.039		1.041		1.082
2009		1.024		1.057		1.083
2010		1.014		1.091		1.106

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Direct Business
Exhibit C15

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY

GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

					Selected						Selected		Ultimate
			Paid ALAE to		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident	Paid ALAE		Paid Loss		Losses		Projection		Projection		ALAE*		Ultimate Loss
Year	($000s)		Ratio		($000s)		($000s)		($000s)		($000s)		Ratio
1989		3		0.375		8		3		3		3		0.375
1990		0				0		0		0		0
1991		0				0		0		0		0
1992		0		0.000		1		0		0		0		0.000
1993		0		0.000		10		0		0		0		0.000
1994		1		0.042		24		1		1		1		0.042
1995		1		0.143		7		1		1		1		0.143
1996		6		3.000		2		6		6		6		3.000
1997		0		0.000		3		0		0		0		0.000
1998		0		0.001		5		0		0		0		0.000
1999		6		0.139		44		6		6		6		0.136
2000		367		0.209		1,788		374		380		367		0.205
2001		629		0.068		9,991		679		661		629		0.063
2002		1,023		0.120		9,152		1,098		1,119		1,023		0.112
2003		2,015		0.087		26,868		2,338		2,317		2,328		0.087
2004		1,899		0.067		35,940		2,408		2,341		2,375		0.066
2005		2,239		0.086		34,331		2,952		3,058		3,005		0.088
2006		967		0.083		18,093		1,502		1,515		1,509		0.083
2007		947		0.085		28,639		2,434		1,826		2,130		0.074
2008		576		0.082		39,554		3,243		1,613		2,428		0.061
2009		394		0.083		62,558		5,192		2,827		4,010		0.064
2010		102		0.106		39,633		4,201		3,230		2,814		0.071
Total		11,175				306,651		26,438		20,904		22,635

* Selected Ultimate ALAE for the 2010 year reflects exposure as of 9/30/10 and is based on an ALAE to Loss Ratio of 7.1%, which is the weighted average ratio of 2001-2009.

Milliman

WSC Direct Business
Exhibit C16

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		3		3		0
1990		0		0		0
1991		0		0		0
1992		0		0		0
1993		0		0		0
1994		1		1		0
1995		1		1		0
1996		6		6		0
1997		0		0		0
1998		0		0		0
1999		6		6		0
2000		367		367		0
2001		629		629		0
2002		1,023		1,023		0
2003		2,328		2,015		313
2004		2,375		1,899		476
2005		3,005		2,239		766
2006		1,509		967		542
2007		2,130		947		1,183
2008		2,428		576		1,852
2009		4,010		394		3,616
2010		2,814		102		2,712
Total		22,635		11,175		11,460

Milliman

WSC Direct Business
Exhibit C17

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET CONTRACT SURETY

GROSS OF SALVAGE AND SUBROGATION

EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE* ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		11		11		11		0		0		0
1990		0		0		0		0		0		0
1991		0		0		0		0		0		0
1992		1		1		1		0		0		0
1993		10		10		10		0		0		0
1994		25		25		25		0		0		0
1995		8		8		8		0		0		0
1996		8		8		8		0		0		0
1997		3		3		3		0		0		0
1998		5		5		5		0		0		0
1999		50		50		50		0		0		0
2000		2,155		2,155		2,155		0		0		0
2001		10,620		10,620		10,620		0		0		0
2002		10,175		10,175		10,175		0		0		0
2003		29,196		28,117		28,109		8		1,079		1,087
2004		38,315		36,842		36,329		513		1,473		1,986
2005		37,336		35,377		33,988		1,389		1,959		3,348
2006		19,602		18,036		16,600		1,436		1,566		3,002
2007		30,769		18,367		17,578		789		12,402		13,191
2008		41,982		17,932		15,252		2,680		24,050		26,730
2009		66,568		34,226		16,585		17,641		32,342		49,983
2010		42,447		10,655		7,498		3,157		31,792		34,949
Total		329,286		222,623		195,010		27,613		106,663		134,276

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit D1

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Loss Salvage & Subrogation Recovered* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1993		0		6		6		9		9		9		9		9		9		9		9		9		9		9		9		9		9		9
1994		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1995		0		0		1		1		1		1		1		1		1		1		3		3		3		3		3		3
1996		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1997		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1998		0		0		0		0		0		0		0		0		0		0		0		0		0
1999		0		0		0		0		0		0		0		0		0		0		0		0
2000		0		316		512		679		695		695		745		745		745		745		745
2001		104		1,569		1,906		1,959		1,984		2,154		2,190		2,216		2,283		2,318
2002		77		940		1,204		1,516		1,667		1,766		1,952		2,137		2,224
2003		329		1,862		3,045		6,545		8,073		8,939		9,676		9,725
2004		9		1,548		4,841		5,698		6,005		6,384		12,927
2005		440		2,162		5,692		10,971		13,124		13,235
2006		576		3,364		4,352		6,429		6,902
2007		528		1,631		2,933		3,745
2008		108		2,532		4,158
2009		543		1,521
2010		1,831
*   Excludes Constar in 2007. Last diagonal is as of 9/30/10.
Accident	Salvage & Subrogation Recovered Development Factors**
Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990																																		1.000		1.000		1.000		1.000
1991
1992
1993				1.000		1.500		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994
1995						1.000		1.000		1.000		1.000		1.000		1.000		1.000		3.000		1.000		1.000		1.000		1.000		1.000
1996
1997
1998
1999
2000				1.620		1.326		1.024		1.000		1.072		1.000		1.000		1.000		1.000
2001		15.087		1.215		1.028		1.013		1.086		1.017		1.012		1.030		1.020
2002		12.208		1.281		1.259		1.100		1.059		1.105		1.095		1.055
2003		5.660		1.635		2.149		1.233		1.107		1.082		1.007
2004		172.000		3.127		1.177		1.054		1.063		2.561
2005		4.914		2.633		1.927		1.196		1.011
2006		5.840		1.294		1.477		1.099
2007		3.089		1.798		1.385
2008		23.444		1.937
2009		3.947
**   Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		27.354		1.754		1.423		1.080		1.041		1.230		1.016		1.014		1.004		1.500		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		10.157		1.677		1.385		1.069		1.037		1.046		1.004		1.008		1.000		1.000		1.000		1.000		1.000		1.000
Col Sum		6.659		1.845		1.546		1.143		1.053		1.550		1.019		1.036		1.015		1.003		1.000		1.000		1.000		1.000		1.000		1.059		1.000		1.000		1.000		1.000
Selected		5.159		1.743		1.510		1.146		1.067		1.089		1.017		1.020		1.011		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		19.037		3.690		2.117		1.402		1.223		1.146		1.052		1.034		1.014		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		33.873		5.561		2.432		1.554		1.265		1.165		1.075		1.038		1.019		1.006		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit D2

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY

EVALUATED AS OF SEPTEMBER 30, 2010

Loss Salvage & Subrogation Recovered Development Projection Method* ($000s)

	(1)		(2)		(3)
					[(1)*(2)]
					Projected
					Ultimate
			Cumulative		Loss
	Sal/Sub		Development		Sal/Sub
Accident	Recovered		Factors		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10
1989		8		1.000		8
1990		1		1.000		1
1991		0		1.000		0
1992		0		1.000		0
1993		9		1.000		9
1994		0		1.000		0
1995		3		1.000		3
1996		0		1.000		0
1997		0		1.000		0
1998		0		1.000		0
1999		0		1.000		0
2000		745		1.002		746
2001		2,318		1.006		2,332
2002		2,224		1.019		2,266
2003		9,725		1.038		10,095
2004		12,927		1.075		13,897
2005		13,235		1.165		15,419
2006		6,902		1.265		8,731
2007		3,745		1.554		5,820
2008		4,158		2.432		10,112
2009		1,521		5.561		8,458
2010		1,831		33.873		46,516
Total		59,352				124,413

* Excludes Constar in the 2007 year.

Note: The 9-Ult Cumulative Development Factor was interpolated using curve fitting methods. The Projected Ultimate Sal/Sub for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit D3

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Paid Loss* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		0		0		0		0		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8		8
1990		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1991		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1992		0		0		0		0		0		0		0		0		0		0		1		1		1		1		1		1		1		1		1
1993		0		9		9		9		9		9		9		9		9		10		10		10		10		10		10		10		10		10
1994		0		0		0		0		0		0		0		21		21		24		24		24		24		24		24		24		24
1995		0		4		4		4		4		4		4		6		7		7		7		7		7		7		7		7
1996		0		0		0		0		0		0		2		2		2		2		2		2		2		2		2
1997		0		0		0		0		0		0		3		3		3		3		3		3		3		3
1998		0		0		0		0		1		1		5		5		5		5		5		5		5
1999		0		0		0		5		24		24		44		44		44		44		44		44
2000		14		1,047		1,544		1,689		1,738		1,738		1,788		1,788		1,788		1,788		1,788
2001		2,960		7,149		7,876		9,578		9,594		9,944		9,977		9,991		9,991		9,991
2002		1,263		4,929		6,853		7,883		8,487		8,952		8,952		9,152		9,152
2003		2,691		12,273		16,619		20,555		22,819		24,380		26,089		26,094
2004		2,992		18,433		25,092		27,375		27,734		28,139		34,430
2005		879		7,658		25,208		30,368		31,295		31,749
2006		1,827		7,611		14,252		15,323		15,633
2007		5,360		10,850		15,582		16,631
2008		3,939		11,823		14,676
2009		6,004		16,191
2010		7,396

* Excludes Constar in 2007. Last diagonal is as of 9/30/10.

Milliman

WSC Direct Business
Exhibit D4

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Loss*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1991		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1992		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
1993		N/A		0.667		0.667		1.000		1.000		1.000		1.000		1.000		1.000		0.900		0.900		0.900		0.900		0.900		0.900		0.900		0.900		0.900
1994		N/A		N/A		N/A		N/A		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
1995		N/A		0.000		0.250		0.250		0.250		0.250		0.250		0.167		0.143		0.143		0.429		0.429		0.429		0.429		0.429		0.429
1996		N/A		N/A		N/A		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
1997		N/A		N/A		N/A		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
1998		N/A		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
1999		N/A		N/A		N/A		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000		0.000
2000		0.000		0.302		0.332		0.402		0.400		0.400		0.417		0.417		0.417		0.417		0.417
2001		0.035		0.219		0.242		0.205		0.207		0.217		0.220		0.222		0.229		0.232
2002		0.061		0.191		0.176		0.192		0.196		0.197		0.218		0.234		0.243
2003		0.122		0.152		0.183		0.318		0.354		0.367		0.371		0.373
2004		0.003		0.084		0.193		0.208		0.217		0.227		0.375
2005		0.501		0.282		0.226		0.361		0.419		0.417
2006		0.315		0.442		0.305		0.420		0.442
2007		0.099		0.150		0.188		0.225
2008		0.027		0.214		0.283
2009		0.090		0.094
2010		0.248
*  Excludes Constar in 2007. Last diagonal is as of 9/30/10.
Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors**
Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989												1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990
1991
1992
1993				1.000		1.500		1.000		1.000		1.000		1.000		1.000		0.900		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994
1995						1.000		1.000		1.000		1.000		0.667		0.857		1.000		3.000		1.000		1.000		1.000		1.000		1.000
1996
1997
1998
1999
2000				1.099		1.212		0.995		1.000		1.042		1.000		1.000		1.000		1.000
2001		6.246		1.103		0.845		1.011		1.047		1.013		1.010		1.030		1.020
2002		3.128		0.921		1.095		1.021		1.004		1.105		1.071		1.055
2003		1.241		1.208		1.738		1.111		1.036		1.012		1.006
2004		27.919		2.297		1.079		1.040		1.048		1.957
2005		0.564		0.800		1.600		1.161		0.992
2006		1.402		0.691		1.374		1.070
2007		1.526		1.252		1.270
2008		7.811		1.452
2009		1.052
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		5.654		1.182		1.271		1.046		1.016		1.141		0.965		0.990		0.984		1.500		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		3.201		1.104		1.266		1.036		1.015		1.029		1.003		1.008		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		1.327		1.168		1.415		1.074		1.029		1.054		1.006		1.010
Selected		2.285		1.185		1.466		1.073		1.047		1.063		1.013		1.006		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Logic	direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct		direct
	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		4.846		2.121		1.790		1.221		1.138		1.087		1.023		1.010		1.004		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		N/A		2.608		1.868		1.344		1.158		1.100		1.039		1.013		1.006		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit D5

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Loss* ($000s)

	(1)		(2)		(3)		(4)		(5)
					[(1)x(2)]				[(3)x(4)]
									Projected
			Cumulative						Ultimate
			Ratio		Projected		Direct		Loss
			Development		Ultimate		Ultimate		Sal/Sub
Accident	Ratio		Factors		Ratio		Loss		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1989		1.000		1.000		1.000		8		8
1990		N/A		1.000		0.000		0		0
1991		N/A		1.000		0.000		0		0
1992		0.000		1.000		0.000		1		0
1993		0.900		1.000		0.900		10		9
1994		0.000		1.000		0.000		24		0
1995		0.429		1.000		0.429		7		3
1996		0.000		1.000		0.000		2		0
1997		0.000		1.000		0.000		3		0
1998		0.000		1.000		0.000		5		0
1999		0.000		1.000		0.000		44		0
2000		0.417		1.000		0.417		1,788		746
2001		0.232		1.002		0.232		9,991		2,318
2002		0.243		1.006		0.244		9,152		2,233
2003		0.373		1.013		0.378		26,868		10,156
2004		0.375		1.039		0.390		35,940		14,017
2005		0.417		1.100		0.459		34,331		15,758
2006		0.442		1.158		0.511		18,093		9,246
2007		0.225		1.344		0.303		28,639		8,678
2008		0.283		1.868		0.529		39,554		20,924
2009		0.094		2.608		0.245		62,558		15,327
2010		0.248		N/A		N/A		39,633		N/A
Total								306,651		99,423

* Excludes Constar in the 2007 year.

Milliman

WSC Direct Business
Exhibit D6

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Bornhuetter — Ferguson Projection* ($000s)

	2006		2007		2008		2009
1) A-Priori Salvage & Subrogation Ratio at 9/30/10**		0.330		0.330		0.330		0.330
2) Selected Ultimate Loss at 9/30/10		18,093		28,639		39,554		62,558
3) A-Priori Ultimate Salvage & Subrogation at 9/30/10 (1) x (2)		5,971		9,451		13,053		20,644
4) Estimated % Unrecovered [1-1/CDF]		0.209		0.356		0.589		0.820
5) Estimated Future Salvage & Subrogation Recoverables at 9/30/10 (3) x (4)		1,248		3,365		7,688		16,928
6) Actual Salvage & Subrogation Recovered to Date		6,902		3,745		4,158		1,521
7) Indicated Ultimate Salvage & Subrogation (5) + (6)		8,150		7,110		11,846		18,449

*	Excludes Constar in the 2007 year.
**	Based on the average Salvage & Subrogation Ratios for 2001-2005.

Milliman

WSC Direct Business
Exhibit D7

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Selection of Ultimate Loss Salvage & Subrogation* ($000s)

			Ultimate		Ultimate		Ultimate
			Sal/Sub		Sal/Sub		Sal/Sub				Selected
	Direct		Indicated by		Indicated by		Indicated by				Ultimate
	Ultimate		Dollar		Ratio		Bornhuetter-		Selected		Sal/Sub
Accident	Loss		Development		Development		Ferguson		Ultimate		to Ultimate
Year	@9/30/10		Method		Method		Method		Sal/Sub		Loss Ratio
1989		8		8		8	xxx			8		1.000
1990		0		1		0	xxx			1		N/A
1991		0		0		0	xxx			0		N/A
1992		1		0		0	xxx			0		0.000
1993		10		9		9	xxx			9		0.900
1994		24		0		0	xxx			0		0.000
1995		7		3		3	xxx			3		0.429
1996		2		0		0	xxx			0		0.000
1997		3		0		0	xxx			0		0.000
1998		5		0		0	xxx			0		0.000
1999		44		0		0	xxx			0		0.000
2000		1,788		746		746	xxx			745		0.417
2001		9,991		2,332		2,318	xxx			2,318		0.232
2002		9,152		2,266		2,233	xxx			2,224		0.243
2003		26,868		10,095		10,156	xxx			10,095		0.376
2004		35,940		13,897		14,017	xxx			13,897		0.387
2005		34,331		15,419		15,758	xxx			14,327		0.417
2006		18,093		8,731		9,246		8,150		8,150		0.450
2007		28,639		5,820		8,678		7,110		6,465		0.226
2008		39,554		10,112		20,924		11,846		10,979		0.278
2009		62,558		8,458		15,327		18,449		14,078		0.225
2010		39,633		46,516		N/A	xxx			9,552		0.241
Total		306,651		124,413		99,423				92,851		0.303

* Excludes Constar in the 2007 year.

Note: Ultimate Salvage & Subrogation for 2010 is based on an Ultimate Sal/Sub Ratio of 24.1%, which is the weighted average of 2007-2009.

Milliman

WSC Direct Business
Exhibit D8

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation* ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		8		8		0
1990		1		1		0
1991		0		0		0
1992		0		0		0
1993		9		9		0
1994		0		0		0
1995		3		3		0
1996		0		0		0
1997		0		0		0
1998		0		0		0
1999		0		0		0
2000		745		745		0
2001		2,318		2,318		0
2002		2,224		2,224		0
2003		10,095		9,725		370
2004		13,897		12,927		970
2005		14,327		13,235		1,092
2006		8,150		6,902		1,248
2007		6,465		3,745		2,720
2008		10,979		4,158		6,821
2009		14,078		1,521		12,557
2010		9,552		1,831		7,721
Total		92,851		59,352		33,499

* Excludes Constar in the 2007 year.

Milliman

WSC Direct Business
Exhibit E1

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

		Paid Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120					132		144	156		168		180		192		204		216		228		240		252		264
1989		363		1,937		3,595		4,652		5,145		5,543		5,697		5,713		5,764			5,798		5,856			5,865		5,866		5,882		5,882		5,882		5,882		5,882		5,907		5,907		5,907		5,907
1990		310		2,107		3,309		4,193		4,894		5,484		5,569		5,870		6,046			6,429		6,532			6,541		6,622		6,805		6,805		6,805		6,805		6,809		6,809		6,809		6,809
1991		373		2,197		3,136		3,631		4,132		4,414		4,562		4,726		4,762			4,790		4,799			4,987		5,009		5,019		5,029		5,029		5,029		5,029		5,029		5,029
1992		574		2,085		2,987		4,340		4,664		4,756		4,799		4,859		4,877			4,910		4,918			4,918		4,918		4,921		4,921		4,921		4,921		4,921		4,921
1993		384		2,125		3,216		3,938		4,351		4,438		4,902		4,956		4,963			4,973		4,976			4,976		4,980		5,130		5,131		5,131		5,131		5,131
1994		274		1,542		2,424		3,085		3,172		3,286		3,545		3,586		3,986			3,992		3,992			3,992		3,999		3,999		3,999		3,999		3,999
1995		370		2,375		3,514		4,069		4,254		4,393		4,740		5,007		5,206			5,408		5,487			5,487		5,487		5,487		5,487		5,487
1996		402		1,886		3,155		4,345		4,873		5,350		5,625		5,775		5,819			5,868		5,877			5,877		5,908		5,908		5,908
1997		641		2,614		3,445		4,090		4,572		4,828		5,097		5,162		5,188			5,305		5,310			5,310		5,508		5,508
1998		709		2,341		3,550		4,497		5,346		6,105		6,645		6,896		6,983			7,194		7,219			7,234		7,234
1999		758		3,722		5,517		6,588		7,123		7,300		7,400		8,536		8,798			8,880		8,920			8,956
2000		857		3,533		6,320		7,286		7,952		8,273		8,412		8,713		8,753			8,757		8,769
2001		1,353		5,578		8,481		9,761		10,303		10,712		10,936		11,626		11,746			11,844
2002		1,428		5,208		7,657		8,669		9,148		9,555		9,864		9,907		9,914
2003		1,581		6,224		7,745		8,616		9,089		9,764		10,155		10,188
2004		1,845		6,290		8,018		9,384		10,357		10,611		10,860
2005		2,463		6,354		8,877		10,396		11,484		11,675
2006		2,359		6,553		9,878		12,637		13,901
2007		1,637		7,242		11,801		13,471
2008		5,584		15,169		19,417
2009		3,224		8,498
2010		1,531
*  Last Diagonal is as of 9/30/10.
		Paid Loss Development Factors**
Accident Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120			120 - 132		132 - 144			144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
1989		5.336		1.856		1.294		1.106		1.077		1.028		1.003		1.009		1.006			1.010		1.002			1.000		1.003		1.000		1.000		1.000		1.000		1.004		1.000		1.000		1.000
1990		6.797		1.570		1.267		1.167		1.121		1.015		1.054		1.030		1.063			1.016		1.001			1.012		1.028		1.000		1.000		1.000		1.001		1.000		1.000		1.000
1991		5.890		1.427		1.158		1.138		1.068		1.034		1.036		1.008		1.006			1.002		1.039			1.004		1.002		1.002		1.000		1.000		1.000		1.000		1.000
1992		3.632		1.433		1.453		1.075		1.020		1.009		1.013		1.004		1.007			1.002		1.000			1.000		1.001		1.000		1.000		1.000		1.000		1.000
1993		5.534		1.513		1.225		1.105		1.020		1.105		1.011		1.001		1.002			1.001		1.000			1.001		1.030		1.000		1.000		1.000		1.000
1994		5.628		1.572		1.273		1.028		1.036		1.079		1.012		1.112		1.002			1.000		1.000			1.002		1.000		1.000		1.000		1.000
1995		6.419		1.480		1.158		1.045		1.033		1.079		1.056		1.040		1.039			1.015		1.000			1.000		1.000		1.000		1.000
1996		4.692		1.673		1.377		1.122		1.098		1.051		1.027		1.008		1.008			1.002		1.000			1.005		1.000		1.000
1997		4.078		1.318		1.187		1.118		1.056		1.056		1.013		1.005		1.023			1.001		1.000			1.037		1.000
1998		3.302		1.516		1.267		1.189		1.142		1.088		1.038		1.013		1.030			1.003		1.002			1.000
1999		4.910		1.482		1.194		1.081		1.025		1.014		1.154		1.031		1.009			1.005		1.005
2000		4.123		1.789		1.153		1.091		1.040		1.017		1.036		1.005		1.000			1.002
2001		4.123		1.520		1.151		1.056		1.040		1.021		1.063		1.010		1.011
2002		3.647		1.470		1.132		1.055		1.044		1.032		1.004		1.001
2003		3.937		1.244		1.112		1.055		1.074		1.040		1.004
2004		3.409		1.275		1.170		1.104		1.025		1.031
2005		2.580		1.397		1.171		1.105		1.022
2006		2.778		1.507		1.279		1.136
2007		4.424		1.630		1.193
2008		2.717		1.390
2009		3.641
2010
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		4.362		1.503		1.222		1.099		1.055		1.044		1.035		1.020		1.016			1.005		1.005			1.006		1.007		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000
Latest 5		3.228		1.440		1.185		1.091		1.041		1.028		1.052		1.012		1.015			1.002		1.001			1.009		1.006		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000
Medial Avg
All Yrs x1		4.327		1.498		1.215		1.097		1.052		1.042		1.028		1.014		1.013			1.004		1.001			1.003		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		3.045		1.431		1.178		1.088		1.036		1.028		1.034		1.009		1.014			1.002		1.001			1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs		3.595		1.467		1.203		1.097		1.051		1.039		1.037		1.016		1.016			1.005		1.004			1.006		1.007		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000
Latest 5		3.082		1.434		1.190		1.095		1.040		1.029		1.047		1.011		1.013			1.003		1.002			1.008		1.006		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000
Latest 3		3.269		1.476		1.215		1.116		1.038		1.035		1.025		1.006		1.007			1.003		1.003			1.012		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120			120 - 132		132 - 144			144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
Comm Assumed		4.644		1.403		1.220		1.136		1.028		1.034		1.011		1.010		1.006			1.005		1.004			1.003		1.002		1.002		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.012
Selected		4.327		1.498		1.215		1.095		1.040		1.039		1.037		1.016		1.016			1.005		1.004			1.008		1.007		1.005		1.003		1.002		1.002		1.001		1.001		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult			120-Ult		132-Ult			144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		10.363		2.395		1.599		1.316		1.202		1.156		1.113		1.073		1.056			1.039		1.034			1.030		1.021		1.014		1.009		1.006		1.004		1.002		1.001		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult			117-Ult		129-Ult			141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		15.851		3.454		1.769		1.382		1.230		1.167		1.124		1.083		1.060			1.043		1.035			1.031		1.023		1.016		1.010		1.007		1.005		1.003		1.001		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit E2

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

																			Indicated
							Cumulative Paid Loss						Indicated Ultimate						Ultimate
	Paid Losses ($000s)						Development Factors						Paid Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		5,907		5,907		5,907		1.000		1.000		1.000		5,907		5,907		5,907		5,907
1990		6,809		6,809		6,809		1.001		1.000		1.000		6,816		6,809		6,809		6,809
1991		5,029		5,029		5,029		1.002		1.001		1.000		5,039		5,034		5,029		5,029
1992		4,921		4,921		4,921		1.004		1.002		1.001		4,941		4,931		4,926		4,926
1993		5,131		5,131		5,131		1.006		1.004		1.003		5,162		5,152		5,146		5,146
1994		3,999		3,999		3,999		1.009		1.006		1.005		4,035		4,023		4,019		4,019
1995		5,487		5,487		5,487		1.014		1.009		1.007		5,564		5,536		5,525		5,525
1996		5,908		5,908		5,908		1.021		1.014		1.010		6,032		5,991		5,967		5,967
1997		5,310		5,508		5,508		1.030		1.021		1.016		5,469		5,624		5,596		5,596
1998		7,219		7,234		7,234		1.034		1.030		1.023		7,464		7,451		7,400		7,400
1999		8,880		8,920		8,956		1.039		1.034		1.031		9,226		9,223		9,234		9,234
2000		8,753		8,757		8,769		1.056		1.039		1.035		9,243		9,099		9,076		9,076
2001		11,626		11,746		11,844		1.073		1.056		1.043		12,475		12,404		12,353		12,353
2002		9,864		9,907		9,914		1.113		1.073		1.060		10,979		10,630		10,509		10,509
2003		9,764		10,155		10,188		1.156		1.113		1.083		11,287		11,303		11,034		11,034
2004		10,357		10,611		10,860		1.202		1.156		1.124		12,449		12,266		12,207		12,207
2005		10,396		11,484		11,675		1.316		1.202		1.167		13,681		13,804		13,625		13,625
2006		9,878		12,637		13,901		1.599		1.316		1.230		15,795		16,630		17,098		17,098
2007		7,242		11,801		13,471		2.395		1.599		1.382		17,345		18,870		18,617		18,617
2008		5,584		15,169		19,417		10.363		2.395		1.769		57,867		36,330		34,349		34,349
2009				3,224		8,498				10.363		3.454				33,410		29,352		29,352
2010						1,531						15.851						24,268		18,201

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit E3

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Incurred Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		2,482		4,864		5,883		5,975		6,388		6,627		6,477		6,460		6,505		6,542		6,467		5,986		5,985		5,985		5,985		5,985		5,985		5,907		5,907		5,907		5,907		5,907
1990		1,862		4,070		5,023		5,821		6,019		6,171		6,809		7,040		6,752		6,590		6,532		6,541		6,622		6,805		6,805		6,805		6,805		6,809		6,809		6,809		6,809
1991		1,374		3,862		4,644		4,877		5,004		5,024		5,107		4,973		4,826		4,896		4,822		5,010		5,010		5,019		5,029		5,029		5,029		5,029		5,029		5,029
1992		2,059		4,754		5,816		5,844		5,113		4,978		4,874		4,924		4,932		5,040		5,059		5,059		4,921		4,921		4,921		4,921		4,921		4,921		4,921
1993		1,914		3,948		4,833		5,620		6,015		5,474		5,307		5,270		5,069		5,079		5,082		5,083		5,089		5,182		5,183		5,131		5,131		5,131
1994		1,552		3,576		3,625		3,707		3,820		4,199		3,953		3,894		4,071		4,007		3,997		3,992		3,999		3,999		3,999		3,999		3,999
1995		2,349		4,396		4,848		5,120		5,042		5,150		5,263		5,290		5,412		5,474		5,503		5,517		5,503		5,503		5,503		5,503
1996		1,510		4,142		4,996		4,996		5,954		6,215		6,212		6,332		5,939		5,906		5,915		5,915		5,946		5,946		5,946
1997		2,105		4,236		4,665		5,158		5,416		5,323		5,432		5,457		5,342		5,429		5,432		5,320		5,508		5,508
1998		2,170		4,983		5,486		5,836		6,573		6,586		6,721		6,923		7,170		7,223		7,247		7,234		7,251
1999		3,970		7,606		7,705		8,004		8,277		8,055		8,409		8,802		8,884		8,891		8,950		8,958
2000		3,084		5,971		7,669		8,355		8,377		8,639		8,874		8,821		8,859		8,857		8,850
2001		2,473		6,798		9,100		10,572		10,814		11,271		11,991		12,149		12,194		12,356
2002		1,518		5,529		8,325		9,150		9,475		10,244		9,954		9,962		9,931
2003		1,823		7,354		9,127		9,977		10,258		10,241		10,192		10,245
2004		4,370		7,854		9,320		10,029		10,903		11,090		11,348
2005		4,238		8,258		10,717		11,532		11,882		12,210
2006		4,907		9,246		12,937		15,337		16,173
2007		4,156		10,146		13,583		14,468
2008		10,460		20,657		23,449
2009		5,785		10,214
2010		2,371
*  Last Diagonal is as of 9/30/10.
	Incurred Loss Development Factors**
Accident Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
1989		1.960		1.209		1.016		1.069		1.037		0.977		0.997		1.007		1.006		0.989		0.926		1.000		1.000		1.000		1.000		1.000		0.987		1.000		1.000		1.000		1.000
1990		2.186		1.234		1.159		1.034		1.025		1.103		1.034		0.959		0.976		0.991		1.001		1.012		1.028		1.000		1.000		1.000		1.001		1.000		1.000		1.000
1991		2.811		1.202		1.050		1.026		1.004		1.017		0.974		0.970		1.015		0.985		1.039		1.000		1.002		1.002		1.000		1.000		1.000		1.000		1.000
1992		2.309		1.223		1.005		0.875		0.974		0.979		1.010		1.002		1.022		1.004		1.000		0.973		1.000		1.000		1.000		1.000		1.000		1.000
1993		2.063		1.224		1.163		1.070		0.910		0.969		0.993		0.962		1.002		1.001		1.000		1.001		1.018		1.000		0.990		1.000		1.000
1994		2.304		1.014		1.023		1.030		1.099		0.941		0.985		1.045		0.984		0.998		0.999		1.002		1.000		1.000		1.000		1.000
1995		1.871		1.103		1.056		0.985		1.021		1.022		1.005		1.023		1.011		1.005		1.003		0.997		1.000		1.000		1.000
1996		2.743		1.206		1.000		1.192		1.044		1.000		1.019		0.938		0.994		1.002		1.000		1.005		1.000		1.000
1997		2.012		1.101		1.106		1.050		0.983		1.020		1.005		0.979		1.016		1.001		0.979		1.035		1.000
1998		2.296		1.101		1.064		1.126		1.002		1.020		1.030		1.036		1.007		1.003		0.998		1.003
1999		1.916		1.013		1.039		1.034		0.973		1.044		1.047		1.009		1.001		1.007		1.001
2000		1.936		1.284		1.089		1.003		1.031		1.027		0.994		1.004		1.000		0.999
2001		2.749		1.339		1.162		1.023		1.042		1.064		1.013		1.004		1.018
2002		3.642		1.506		1.099		1.036		1.081		0.972		1.001		0.996
2003		4.034		1.241		1.093		1.028		0.998		0.995		1.007
2004		1.797		1.187		1.076		1.087		1.017		1.031
2005		1.949		1.298		1.076		1.030		1.037
2006		1.884		1.399		1.186		1.073
2007		2.441		1.339		1.088
2008		1.975		1.184
2009		2.134
2010
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		2.334		1.220		1.081		1.043		1.016		1.011		1.008		0.995		1.004		0.999		0.995		1.003		1.005		1.000		0.999		1.000		0.998		1.000		1.000		1.000		1.000
Latest 5		2.077		1.281		1.104		1.051		1.035		1.018		1.012		1.010		1.008		1.002		0.996		1.009		1.004		1.000		0.998		1.000		0.998		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		2.273		1.216		1.080		1.044		1.018		1.010		1.007		0.996		1.005		0.999		0.998		1.003		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		2.019		1.274		1.086		1.046		1.032		1.018		1.007		1.006		1.008		1.002		1.000		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs		2.186		1.231		1.090		1.043		1.018		1.015		1.009		0.996		1.005		0.999		0.994		1.003		1.006		1.000		0.999		1.000		0.997		1.000		1.000		1.000		1.000
Latest 5		2.053		1.265		1.107		1.053		1.034		1.019		1.012		1.008		1.009		1.002		0.997		1.008		1.004		1.000		0.998		1.000		0.997		1.000		1.000		1.000		1.000
Latest 3		2.115		1.273		1.118		1.064		1.018		1.000		1.007		1.001		1.007		1.003		0.995		1.013		1.000		1.000		0.996		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
Comm Assumed		2.397		1.390		1.049		1.025		1.000		1.000		1.010		1.009		1.005		1.005		1.004		1.003		1.002		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.006
Selected		2.053		1.265		1.107		1.053		1.034		1.019		1.012		1.008		1.009		1.002		1.002		1.003		1.004		1.002		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		3.338		1.626		1.285		1.161		1.103		1.067		1.047		1.035		1.027		1.018		1.016		1.014		1.011		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		4.350		1.946		1.363		1.191		1.117		1.076		1.052		1.038		1.029		1.020		1.017		1.015		1.012		1.008		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit E4

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

																			Indicated
							Cumulative Incurred Loss						Indicated Ultimate						Ultimate
	Incurred Losses ($000s)						Development Factors						Incurred Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		5,907		5,907		5,907		1.000		1.000		1.000		5,907		5,907		5,907		5,907
1990		6,809		6,809		6,809		1.000		1.000		1.000		6,809		6,809		6,809		6,809
1991		5,029		5,029		5,029		1.001		1.000		1.000		5,034		5,029		5,029		5,029
1992		4,921		4,921		4,921		1.002		1.001		1.000		4,931		4,926		4,921		4,921
1993		5,131		5,131		5,131		1.003		1.002		1.001		5,146		5,141		5,136		5,136
1994		3,999		3,999		3,999		1.005		1.003		1.002		4,019		4,011		4,007		4,007
1995		5,503		5,503		5,503		1.007		1.005		1.004		5,542		5,531		5,525		5,525
1996		5,946		5,946		5,946		1.011		1.007		1.006		6,011		5,988		5,982		5,982
1997		5,320		5,508		5,508		1.014		1.011		1.008		5,394		5,569		5,552		5,552
1998		7,247		7,234		7,251		1.016		1.014		1.012		7,363		7,335		7,338		7,338
1999		8,891		8,950		8,958		1.018		1.016		1.015		9,051		9,093		9,092		9,092
2000		8,859		8,857		8,850		1.027		1.018		1.017		9,098		9,016		9,000		9,000
2001		12,149		12,194		12,356		1.035		1.027		1.020		12,574		12,523		12,603		12,603
2002		9,954		9,962		9,931		1.047		1.035		1.029		10,422		10,311		10,219		10,219
2003		10,241		10,192		10,245		1.067		1.047		1.038		10,927		10,671		10,634		10,634
2004		10,903		11,090		11,348		1.103		1.067		1.052		12,026		11,833		11,938		11,938
2005		11,532		11,882		12,210		1.161		1.103		1.076		13,389		13,106		13,138		13,138
2006		12,937		15,337		16,173		1.285		1.161		1.117		16,624		17,806		18,065		18,065
2007		10,146		13,583		14,468		1.626		1.285		1.191		16,497		17,454		17,231		17,231
2008		10,460		20,657		23,449		3.338		1.626		1.363		34,915		33,588		31,961		31,961
2009				5,785		10,214				3.338		1.946				19,310		19,876		19,876
2010						2,371						4.350						10,314		7,736

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit E5

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1989 — 2007 Ultimate Losses ($000s)

			Indicated Ultimate
			Losses Based on:
	Incurred				Incurred		Selected
Accident	Losses		Paid Loss		Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1989		5,907		5,907		5,907		5,907
1990		6,809		6,809		6,809		6,809
1991		5,029		5,029		5,029		5,029
1992		4,921		4,926		4,921		4,921
1993		5,131		5,146		5,136		5,131
1994		3,999		4,019		4,007		3,999
1995		5,503		5,525		5,525		5,525
1996		5,946		5,967		5,982		5,982
1997		5,508		5,596		5,552		5,552
1998		7,251		7,400		7,338		7,369
1999		8,958		9,234		9,092		9,163
2000		8,850		9,076		9,000		9,038
2001		12,356		12,353		12,603		12,603
2002		9,931		10,509		10,219		10,364
2003		10,245		11,034		10,634		10,834
2004		11,348		12,207		11,938		12,073
2005		12,210		13,625		13,138		13,382
2006		16,173		17,098		18,065		17,582
2007		14,468		18,617		17,231		17,924
Total		160,543		170,077		168,126		169,187

Milliman

WSC Direct Business
Exhibit E6

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection ($000s)

	Direct Business							Assumed Business
	Selected							Gross
	Ultimate		Gross Earned		Gross Loss			Ultimate		Gross Earned		Gross Loss
Accident	Losses		Premium		Ratio			Losses		Premium		Ratio
Year	@9/30/10		@9/30/10		@9/30/10			@9/30/10		@9/30/10		@9/30/10
1989		5,907		36,359		16.2	%		8,351		39,735		21.0	%
1990		6,809		35,860		19.0	%		17,984		44,623		40.3	%
1991		5,029		37,282		13.5	%		10,544		36,238		29.1	%
1992		4,921		38,846		12.7	%		3,613		29,804		12.1	%
1993		5,131		40,046		12.8	%		3,766		48,750		7.7	%
1994		3,999		39,837		10.0	%		3,268		53,388		6.1	%
1995		5,525		39,966		13.8	%		2,870		57,454		5.0	%
1996		5,982		40,223		14.9	%		6,558		49,455		13.3	%
1997		5,552		41,504		13.4	%		2,643		49,996		5.3	%
1998		7,369		54,937		13.4	%		7,962		46,420		17.2	%
1999		9,163		56,577		16.2	%		22,855		54,400		42.0	%
2000		9,038		59,964		15.1	%		25,225		60,224		41.9	%
2001		12,603		63,471		19.9	%		20,649		64,202		32.2	%
2002		10,364		69,405		14.9	%		2,337		56,069		4.2	%
2003		10,834		77,966		13.9	%		28,672		46,577		61.6	%
2004		12,073		93,228		12.9	%		2,328		38,530		6.0	%
2005		13,382		104,812		12.8	%		2,082		19,078		10.9	%
2006		17,582		110,998		15.8	%		1,117		16,229		6.9	%
2007		17,924		115,448		15.5	%		1,182		12,705		9.3	%
Total		169,187		1,156,729		14.6	%		174,006		823,877		21.1	%
Total 04-07		60,961		424,486		14.4	%		6,709		86,542		7.8	%
Selected						14.4	%						7.8	%

Direct

Assumed

Selected

Loss Ratio

Accident

Gross Earned

Business

Business

Weighted

Projection

Year

Premium

Weight*

Weight*

Loss Ratio**

@9/30/10

2008

118,321

82.4

%

17.6

%

13.2

%

15,618

*	Provided by Western Surety Company.
**	Based on a weighted average loss ratio of the previous four accident years.

Milliman

WSC Direct Business
Exhibit E7

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection ($000s)

	Direct Business							Assumed Business
	Selected							Gross
	Ultimate		Gross Earned		Gross Loss			Ultimate		Gross Earned		Gross Loss
Accident	Losses		Premium		Ratio			Losses		Premium		Ratio
Year	@9/30/10		@9/30/10		@9/30/10			@9/30/10		@9/30/10		@9/30/10
1989		5,907		36,359		16.2	%		8,351		39,735		21.0	%
1990		6,809		35,860		19.0	%		17,984		44,623		40.3	%
1991		5,029		37,282		13.5	%		10,544		36,238		29.1	%
1992		4,921		38,846		12.7	%		3,613		29,804		12.1	%
1993		5,131		40,046		12.8	%		3,766		48,750		7.7	%
1994		3,999		39,837		10.0	%		3,268		53,388		6.1	%
1995		5,525		39,966		13.8	%		2,870		57,454		5.0	%
1996		5,982		40,223		14.9	%		6,558		49,455		13.3	%
1997		5,552		41,504		13.4	%		2,643		49,996		5.3	%
1998		7,369		54,937		13.4	%		7,962		46,420		17.2	%
1999		9,163		56,577		16.2	%		22,855		54,400		42.0	%
2000		9,038		59,964		15.1	%		25,225		60,224		41.9	%
2001		12,603		63,471		19.9	%		20,649		64,202		32.2	%
2002		10,364		69,405		14.9	%		2,337		56,069		4.2	%
2003		10,834		77,966		13.9	%		28,672		46,577		61.6	%
2004		12,073		93,228		12.9	%		2,328		38,530		6.0	%
2005		13,382		104,812		12.8	%		2,082		19,078		10.9	%
2006		17,582		110,998		15.8	%		1,117		16,229		6.9	%
2007		17,924		115,448		15.5	%		1,182		12,705		9.3	%
2008		29,782		118,321		25.2	%		1,731		11,769		14.7	%
Total		198,969		1,275,050		15.6	%		175,737		835,646		21.0	%
Total 05-08		78,670		449,579		17.5	%		6,112		59,781		10.2	%
Selected						17.5	%						10.2	%

Direct

Assumed

Selected

Loss Ratio

Accident

Gross Earned

Business

Business

Weighted

Projection

Year

Premium

Weight*

Weight*

Loss Ratio**

@9/30/10

2009

118,770

81.2

%

18.8

%

16.1

%

19,122

*	Provided by Western Surety Company.
**	Based on a weighted average loss ratio of the previous four accident years.

Milliman

WSC Direct Business
Exhibit E8

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection ($000s)

	Direct Business							Assumed Business
	Selected							Gross
	Ultimate		Gross Earned		Gross Loss			Ultimate		Gross Earned		Gross Loss
Accident	Losses		Premium		Ratio			Losses		Premium		Ratio
Year	@9/30/10		@9/30/10		@9/30/10			@9/30/10		@9/30/10		@9/30/10
1989		5,907		36,359		16.2	%		8,351		39,735		21.0	%
1990		6,809		35,860		19.0	%		17,984		44,623		40.3	%
1991		5,029		37,282		13.5	%		10,544		36,238		29.1	%
1992		4,921		38,846		12.7	%		3,613		29,804		12.1	%
1993		5,131		40,046		12.8	%		3,766		48,750		7.7	%
1994		3,999		39,837		10.0	%		3,268		53,388		6.1	%
1995		5,525		39,966		13.8	%		2,870		57,454		5.0	%
1996		5,982		40,223		14.9	%		6,558		49,455		13.3	%
1997		5,552		41,504		13.4	%		2,643		49,996		5.3	%
1998		7,369		54,937		13.4	%		7,962		46,420		17.2	%
1999		9,163		56,577		16.2	%		22,855		54,400		42.0	%
2000		9,038		59,964		15.1	%		25,225		60,224		41.9	%
2001		12,603		63,471		19.9	%		20,649		64,202		32.2	%
2002		10,364		69,405		14.9	%		2,337		56,069		4.2	%
2003		10,834		77,966		13.9	%		28,672		46,577		61.6	%
2004		12,073		93,228		12.9	%		2,328		38,530		6.0	%
2005		13,382		104,812		12.8	%		2,082		19,078		10.9	%
2006		17,582		110,998		15.8	%		1,117		16,229		6.9	%
2007		17,924		115,448		15.5	%		1,182		12,705		9.3	%
2008		29,782		118,321		25.2	%		1,731		11,769		14.7	%
2009		19,507		118,770		16.4	%		1,558		9,955		15.7	%
Total		218,476		1,393,820		15.7	%		177,295		845,601		21.0	%
Total 06-09		84,795		463,537		18.3	%		5,588		50,658		11.0	%
Selected						18.3	%						11.0	%

Direct

Assumed

Selected

Loss Ratio

Accident

Gross Earned

Business

Business

Weighted

Projection

Year

Premium

Weight*

Weight*

Loss Ratio**

@9/30/10

2010

88,582

80.1

%

19.9

%

16.8

%

14,882

*	Provided by Western Surety Company.
**	Based on a weighted average loss ratio of the previous four accident years.

Milliman

WSC Direct Business
Exhibit E9

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection ($000s)

	A’priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent					Losses		Ultimate
Year	Losses*		Unreported			Indicated IBNR		@9/30/10		Losses**
2008		15,618		26.6	%		4,154		23,449		27,603
2009		19,122		48.6	%		9,293		10,214		19,507
2010		19,843		77.0	%		15,279		2,371		13,238
Total		54,583					28,726		36,034		60,348

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit E10

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection ($000s)

	A’priori		Estimated							Indicated
Accident	Ultimate		Percent			Indicated		Paid Losses		Ultimate
Year	Losses*		Unpaid			Unpaid		@9/30/10		Losses**
2008		15,618		43.5	%		6,794		19,417		26,211
2009		19,122		71.0	%		13,577		8,498		22,075
2010		19,843		93.7	%		18,593		1,531		15,093
Total		54,583					38,964		29,446		63,379

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit E11

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2008 — 2010 Ultimate Losses ($000s)

					Indicated Ultimate Losses* Based on:
															Selected
	Incurred		Gross				Incurred								Ultimate		Ultimate
Accident	Losses		Earned		Paid Loss		Loss		Incurred B/F		Paid B/F		Loss Ratio		Losses		Loss Ratio
Year	@9/30/10		Premium*		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2008		23,449		118,321		34,349		31,961		27,603		26,211		15,618		29,782		25.2	%
2009		10,214		118,770		29,352		19,876		19,507		22,075		19,122		19,507		16.4	%
2010		2,371		88,582		18,201		7,736		13,238		15,093		14,882		14,882		16.8	%
Total		36,034		325,674		81,902		59,573		60,348		63,379		49,622		64,171		19.7	%

* Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Direct Business
Exhibit E12

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		5,907		5,907		5,907		0		0		0
1990		6,809		6,809		6,809		0		0		0
1991		5,029		5,029		5,029		0		0		0
1992		4,921		4,921		4,921		0		0		0
1993		5,131		5,131		5,131		0		0		0
1994		3,999		3,999		3,999		0		0		0
1995		5,525		5,503		5,487		16		22		38
1996		5,982		5,946		5,908		38		36		74
1997		5,552		5,508		5,508		0		44		44
1998		7,369		7,251		7,234		17		118		135
1999		9,163		8,958		8,956		2		205		207
2000		9,038		8,850		8,769		81		188		269
2001		12,603		12,356		11,844		512		247		759
2002		10,364		9,931		9,914		17		433		450
2003		10,834		10,245		10,188		57		589		646
2004		12,073		11,348		10,860		488		725		1,213
2005		13,382		12,210		11,675		535		1,172		1,707
2006		17,582		16,173		13,901		2,272		1,409		3,681
2007		17,924		14,468		13,471		997		3,456		4,453
2008		29,782		23,449		19,417		4,032		6,333		10,365
2009		19,507		10,214		8,498		1,716		9,293		11,009
2010		14,882		2,371		1,531		840		12,511		13,351
Total		233,358		196,577		184,957		11,620		36,781		48,401

Milliman

WSC Direct Business
Exhibit E13

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		61		355		670		895		1,035		1,134		1,178		1,209		1,236		1,241		1,255		1,267		1,270		1,274		1,280		1,283		1,284		1,288		1,288		1,290		1,290		1,290
1990		40		198		478		746		932		1,046		1,132		1,232		1,298		1,317		1,333		1,353		1,366		1,391		1,394		1,395		1,395		1,396		1,396		1,396		1,396
1991		44		199		384		522		621		680		752		810		839		862		885		894		896		896		896		896		896		896		898		898
1992		43		261		557		736		855		919		960		986		993		1,006		1,011		1,027		1,030		1,031		1,031		1,031		1,031		1,031		1,031
1993		94		309		532		661		801		868		895		916		933		954		957		959		965		972		978		978		983		983
1994		33		232		353		451		503		547		593		623		642		647		647		649		652		652		656		656		664
1995		38		302		465		588		650		719		764		804		887		925		953		960		967		969		969		971
1996		38		245		516		732		850		916		957		976		998		1,016		1,022		1,024		1,028		1,033		1,041
1997		44		376		699		875		992		1,038		1,097		1,134		1,149		1,169		1,170		1,171		1,173		1,174
1998		57		458		765		944		1,087		1,197		1,299		1,375		1,397		1,415		1,422		1,430		1,432
1999		100		572		1,064		1,457		1,754		1,829		1,886		1,947		2,001		2,074		2,131		2,147
2000		81		540		833		1,077		1,215		1,306		1,382		1,421		1,467		1,479		1,492
2001		95		447		1,019		1,392		1,582		1,729		1,900		2,013		2,247		2,332
2002		69		404		779		990		1,154		1,255		1,297		1,344		1,360
2003		85		391		730		1,011		1,225		1,379		1,434		1,486
2004		83		455		744		1,037		1,213		1,302		1,355
2005		156		622		1,029		1,286		1,496		1,670
2006		286		1,009		1,635		2,158		2,437
2007		190		742		1,402		1,756
2008		231		979		1,758
2009		185		794
2010		93

* Last Diagonal is as of 9/30/10.

	Paid ALAE Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		5.820		1.887		1.336		1.156		1.096		1.039		1.026		1.022		1.004		1.011		1.010		1.002		1.003		1.005		1.002		1.001		1.003		1.000		1.002		1.000		1.000
1990		4.950		2.414		1.561		1.249		1.122		1.082		1.088		1.054		1.015		1.012		1.015		1.010		1.018		1.002		1.001		1.000		1.001		1.000		1.000		1.000
1991		4.523		1.930		1.359		1.190		1.095		1.106		1.077		1.036		1.027		1.027		1.010		1.002		1.000		1.000		1.000		1.000		1.000		1.002		1.000
1992		6.070		2.134		1.321		1.162		1.075		1.045		1.027		1.007		1.013		1.005		1.016		1.003		1.001		1.000		1.000		1.000		1.000		1.000
1993		3.287		1.722		1.242		1.212		1.084		1.031		1.023		1.019		1.023		1.003		1.002		1.006		1.007		1.006		1.000		1.005		1.000
1994		7.030		1.522		1.278		1.115		1.087		1.084		1.051		1.030		1.008		1.000		1.003		1.005		1.000		1.006		1.000		1.016
1995		7.947		1.540		1.265		1.105		1.106		1.063		1.052		1.103		1.043		1.030		1.007		1.007		1.002		1.000		1.003
1996		6.447		2.106		1.419		1.161		1.078		1.045		1.020		1.023		1.018		1.006		1.002		1.004		1.005		1.010
1997		8.545		1.859		1.252		1.134		1.046		1.057		1.034		1.013		1.017		1.001		1.001		1.002		1.001
1998		8.035		1.670		1.234		1.151		1.101		1.085		1.059		1.016		1.013		1.005		1.006		1.002
1999		5.720		1.860		1.369		1.204		1.043		1.031		1.032		1.028		1.036		1.027		1.010
2000		6.667		1.543		1.293		1.128		1.075		1.058		1.028		1.032		1.008		1.012
2001		4.705		2.280		1.366		1.136		1.093		1.099		1.059		1.116		1.051
2002		5.855		1.928		1.271		1.166		1.088		1.033		1.036		1.016
2003		4.600		1.867		1.385		1.212		1.126		1.040		1.049
2004		5.482		1.635		1.394		1.170		1.073		1.055
2005		3.987		1.654		1.250		1.163		1.158
2006		3.528		1.620		1.320		1.176
2007		3.905		1.889		1.350
2008		4.238		2.183
2009		6.975
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	5.634	1.862	1.330	1.166	1.091	1.060	1.044	1.037	1.021	1.012	1.007	1.004	1.004	1.004	1.001	1.004	1.001	1.001	1.001	1.000	1.000
Latest 5	4.527	1.796	1.340	1.177	1.108	1.057	1.041	1.042	1.025	1.010	1.005	1.004	1.003	1.005	1.001	1.004	1.001	1.001	1.001	1.000	1.000
Medial Avg
All Yrs x1	5.604	1.850	1.322	1.165	1.090	1.058	1.043	1.033	1.020	1.011	1.007	1.004	1.003	1.003	1.001	1.001	1.000	1.000	1.000	1.000	1.000
Latest 5x1	4.044	1.726	1.352	1.170	1.102	1.051	1.039	1.025	1.022	1.008	1.005	1.003	1.003	1.004	1.000	1.002	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	5.059	1.846	1.327	1.168	1.091	1.058	1.044	1.039	1.024	1.013	1.008	1.004	1.005	1.004	1.001	1.003	1.001	1.000	1.001	1.000	1.000
Latest 5	4.430	1.825	1.333	1.176	1.109	1.060	1.042	1.047	1.029	1.012	1.006	1.004	1.003	1.004	1.001	1.003	1.001	1.000	1.001	1.000	1.000
Latest 3	4.969	1.895	1.313	1.171	1.122	1.043	1.050	1.063	1.035	1.016	1.006	1.002	1.003	1.006	1.001	1.006	1.000	1.001	1.001	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Comm Assumed		6.318		2.189		1.599		1.137		1.182		1.108		1.065		1.035		1.019		1.003		1.009		1.011		1.013		1.007		1.010		1.006		1.002		1.002		1.001		1.001		1.001		1.007
Selected		5.059		1.846		1.333		1.176		1.109		1.060		1.042		1.047		1.029		1.013		1.006		1.004		1.004		1.004		1.001		1.003		1.001		1.000		1.001		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		20.039		3.961		2.146		1.610		1.369		1.234		1.164		1.117		1.067		1.037		1.024		1.018		1.014		1.010		1.006		1.005		1.002		1.001		1.001		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		33.663		5.940		2.501		1.730		1.426		1.266		1.181		1.129		1.079		1.044		1.027		1.020		1.015		1.011		1.007		1.005		1.003		1.001		1.001		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit E14

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

																			Indicated
							Cumulative Paid ALAE						Indicated Ultimate						Ultimate
	Paid ALAE ($000s)						Development Factors						Paid ALAE ($000s)						ALAE
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		1,290		1,290		1,290		1.000		1.000		1.000		1,290		1,290		1,290		1,290
1990		1,396		1,396		1,396		1.001		1.000		1.000		1,397		1,396		1,396		1,396
1991		896		898		898		1.001		1.001		1.000		897		899		898		898
1992		1,031		1,031		1,031		1.002		1.001		1.001		1,033		1,032		1,032		1,032
1993		978		983		983		1.005		1.002		1.001		983		985		984		984
1994		656		656		664		1.006		1.005		1.003		660		659		666		666
1995		969		969		971		1.010		1.006		1.005		979		975		976		976
1996		1,028		1,033		1,041		1.014		1.010		1.007		1,042		1,043		1,048		1,048
1997		1,171		1,173		1,174		1.018		1.014		1.011		1,192		1,189		1,187		1,187
1998		1,422		1,430		1,432		1.024		1.018		1.015		1,456		1,456		1,453		1,453
1999		2,074		2,131		2,147		1.037		1.024		1.020		2,151		2,182		2,190		2,190
2000		1,467		1,479		1,492		1.067		1.037		1.027		1,565		1,534		1,532		1,532
2001		2,013		2,247		2,332		1.117		1.067		1.044		2,249		2,398		2,435		2,435
2002		1,297		1,344		1,360		1.164		1.117		1.079		1,510		1,501		1,467		1,467
2003		1,379		1,434		1,486		1.234		1.164		1.129		1,702		1,669		1,678		1,678
2004		1,213		1,302		1,355		1.369		1.234		1.181		1,661		1,607		1,600		1,600
2005		1,286		1,496		1,670		1.610		1.369		1.266		2,070		2,048		2,114		2,114
2006		1,635		2,158		2,437		2.146		1.610		1.426		3,509		3,474		3,475		3,475
2007		742		1,402		1,756		3.961		2.146		1.730		2,939		3,009		3,038		3,038
2008		231		979		1,758		20.039		3.961		2.501		4,629		3,878		4,397		4,397
2009				185		794				20.039		5.940				3,707		4,716		4,716
2010						93						33.663						3,131		2,348

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit E15

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE / Paid Loss +1*
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		1.168		1.183		1.186		1.192		1.201		1.205		1.207		1.212		1.214		1.214		1.214		1.216		1.217		1.217		1.218		1.218		1.218		1.219		1.218		1.218		1.218		1.218
1990		1.129		1.094		1.144		1.178		1.190		1.191		1.203		1.210		1.215		1.205		1.204		1.207		1.206		1.204		1.205		1.205		1.205		1.205		1.205		1.205		1.205
1991		1.118		1.091		1.122		1.144		1.150		1.154		1.165		1.171		1.176		1.180		1.184		1.179		1.179		1.179		1.178		1.178		1.178		1.178		1.179		1.179
1992		1.075		1.125		1.186		1.170		1.183		1.193		1.200		1.203		1.204		1.205		1.206		1.209		1.209		1.210		1.210		1.210		1.210		1.210		1.210
1993		1.245		1.145		1.165		1.168		1.184		1.196		1.183		1.185		1.188		1.192		1.192		1.193		1.194		1.189		1.191		1.191		1.192		1.192
1994		1.120		1.150		1.146		1.146		1.159		1.166		1.167		1.174		1.161		1.162		1.162		1.163		1.163		1.163		1.164		1.164		1.166
1995		1.103		1.127		1.132		1.145		1.153		1.164		1.161		1.161		1.170		1.171		1.174		1.175		1.176		1.177		1.177		1.177
1996		1.095		1.130		1.164		1.168		1.174		1.171		1.170		1.169		1.172		1.173		1.174		1.174		1.174		1.175		1.176
1997		1.069		1.144		1.203		1.214		1.217		1.215		1.215		1.220		1.221		1.220		1.220		1.221		1.213		1.213
1998		1.080		1.196		1.215		1.210		1.203		1.196		1.195		1.199		1.200		1.197		1.197		1.198		1.198
1999		1.132		1.154		1.193		1.221		1.246		1.251		1.255		1.228		1.227		1.234		1.239		1.240
2000		1.095		1.153		1.132		1.148		1.153		1.158		1.164		1.163		1.168		1.169		1.170
2001		1.070		1.080		1.120		1.143		1.154		1.161		1.174		1.173		1.191		1.197
2002		1.048		1.078		1.102		1.114		1.126		1.131		1.131		1.136		1.137
2003		1.054		1.063		1.094		1.117		1.135		1.141		1.141		1.146
2004		1.045		1.072		1.093		1.111		1.117		1.123		1.125
2005		1.063		1.098		1.116		1.124		1.130		1.143
2006		1.121		1.154		1.166		1.171		1.175
2007		1.116		1.102		1.119		1.130
2008		1.041		1.065		1.091
2009		1.057		1.093
2010		1.061

* Last Diagonal is as of 9/30/10.

	Paid ALAE / Paid Loss + 1 Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		1.013		1.003		1.005		1.007		1.003		1.002		1.004		1.002		1.000		1.000		1.001		1.000		1.000		1.001		1.000		1.000		1.001		0.999		1.000		1.000		1.000
1990		0.969		1.046		1.029		1.011		1.000		1.011		1.005		1.004		0.992		0.999		1.002		1.000		0.998		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		0.976		1.029		1.019		1.006		1.003		1.009		1.006		1.004		1.003		1.004		0.996		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		1.047		1.054		0.986		1.012		1.008		1.006		1.002		1.001		1.001		1.001		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1993		0.920		1.017		1.002		1.014		1.010		0.989		1.002		1.003		1.003		1.000		1.000		1.001		0.996		1.001		1.000		1.001		1.000
1994		1.027		0.996		1.000		1.011		1.007		1.001		1.006		0.989		1.001		1.000		1.000		1.000		1.000		1.001		1.000		1.002
1995		1.022		1.005		1.011		1.007		1.009		0.998		0.999		1.008		1.001		1.002		1.001		1.001		1.000		1.000		1.000
1996		1.032		1.030		1.004		1.005		0.997		0.999		0.999		1.002		1.001		1.001		1.000		1.000		1.001		1.002
1997		1.070		1.052		1.009		1.003		0.998		1.000		1.004		1.001		0.999		1.000		1.000		0.994		1.000
1998		1.107		1.017		0.995		0.995		0.994		1.000		1.003		1.001		0.997		1.000		1.001		1.000
1999		1.019		1.034		1.024		1.021		1.003		1.003		0.979		0.999		1.005		1.004		1.001
2000		1.053		0.982		1.014		1.004		1.004		1.006		0.999		1.004		1.001		1.001
2001		1.009		1.037		1.020		1.010		1.007		1.011		0.999		1.015		1.006
2002		1.028		1.022		1.011		1.011		1.005		1.000		1.004		1.002
2003		1.009		1.030		1.021		1.016		1.006		1.000		1.005
2004		1.026		1.019		1.016		1.006		1.005		1.002
2005		1.032		1.016		1.007		1.006		1.015
2006		1.029		1.010		1.005		1.005
2007		0.988		1.015		1.014
2008		1.022		1.033
2009		1.046
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	1.021	1.022	1.010	1.008	1.004	1.002	1.001	1.003	1.001	1.001	1.001	1.000	1.000	1.001	1.000	1.001	1.000	1.000	1.000	1.000	1.000
Latest 5	1.023	1.019	1.013	1.009	1.007	1.004	0.997	1.004	1.002	1.001	1.001	0.999	1.000	1.001	1.000	1.001	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	1.022	1.023	1.010	1.008	1.004	1.003	1.002	1.003	1.001	1.001	1.001	1.000	1.000	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	1.028	1.017	1.012	1.008	1.006	1.003	1.001	1.002	1.002	1.001	1.001	1.000	1.000	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Comm Assumed		1.036		1.019		1.009		1.005		1.005		1.004		1.003		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Selected		1.022		1.023		1.010		1.008		1.004		1.003		1.002		1.003		1.001		1.001		1.001		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		1.081		1.058		1.034		1.024		1.016		1.012		1.009		1.007		1.004		1.003		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		1.106		1.064		1.040		1.027		1.018		1.013		1.010		1.008		1.005		1.003		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit E16

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	Paid ALAE /		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
	Ratio		Factors for		Ratio
Accident Year	@9/30/10		9/10-Ult		@9/30/10
1989		1.218		1.000		1.218
1990		1.205		1.000		1.205
1991		1.179		1.000		1.179
1992		1.210		1.000		1.210
1993		1.192		1.000		1.192
1994		1.166		1.000		1.166
1995		1.177		1.000		1.177
1996		1.176		1.000		1.176
1997		1.213		1.001		1.214
1998		1.198		1.001		1.199
1999		1.240		1.001		1.241
2000		1.170		1.002		1.172
2001		1.197		1.003		1.200
2002		1.137		1.005		1.143
2003		1.146		1.008		1.155
2004		1.125		1.010		1.136
2005		1.143		1.013		1.158
2006		1.175		1.018		1.196
2007		1.130		1.027		1.161
2008		1.091		1.040		1.134
2009		1.093		1.064		1.163
2010		1.061		1.106		1.173

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Direct Business
Exhibit E17

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

					Selected						Selected		Ultimate
			Paid ALAE to		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident	Paid ALAE		Paid Loss		Losses		Projection		Projection		ALAE*		Ultimate Loss
Year	($000s)		Ratio		($000s)		($000s)		($000s)		($000s)		Ratio
1989		1,290		0.218		5,907		1,288		1,290		1,290		0.218
1990		1,396		0.205		6,809		1,396		1,396		1,396		0.205
1991		898		0.179		5,029		900		898		898		0.179
1992		1,031		0.210		4,921		1,033		1,032		1,031		0.210
1993		983		0.192		5,131		985		984		983		0.192
1994		664		0.166		3,999		664		666		664		0.166
1995		971		0.177		5,525		978		976		977		0.177
1996		1,041		0.176		5,982		1,053		1,048		1,051		0.176
1997		1,174		0.214		5,552		1,188		1,187		1,181		0.213
1998		1,432		0.199		7,369		1,466		1,453		1,449		0.197
1999		2,147		0.241		9,163		2,208		2,190		2,178		0.238
2000		1,492		0.172		9,038		1,555		1,532		1,544		0.171
2001		2,332		0.200		12,603		2,521		2,435		2,478		0.197
2002		1,360		0.143		10,364		1,482		1,467		1,475		0.142
2003		1,486		0.155		10,834		1,679		1,678		1,679		0.155
2004		1,355		0.136		12,073		1,642		1,600		1,621		0.134
2005		1,670		0.158		13,382		2,114		2,114		2,114		0.158
2006		2,437		0.196		17,582		3,446		3,475		3,461		0.197
2007		1,756		0.161		17,924		2,886		3,038		2,962		0.165
2008		1,758		0.134		29,782		3,991		4,397		4,194		0.141
2009		794		0.163		19,507		3,180		4,716		3,948		0.202
2010		93		0.173		14,882		2,575		2,348		2,456		0.165
Total		29,560				233,358		40,230		41,920		41,030

* Selected Ultimate ALAE for the 2010 year reflects exposure as of 9/30/10 and is based on an ALAE to Loss Ratio of 16.5%, which is the weighted average ratio of 2007-2009.

Milliman

WSC Direct Business
Exhibit E18

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		1,290		1,290		0
1990		1,396		1,396		0
1991		898		898		0
1992		1,031		1,031		0
1993		983		983		0
1994		664		664		0
1995		977		971		6
1996		1,051		1,041		10
1997		1,181		1,174		7
1998		1,449		1,432		17
1999		2,178		2,147		31
2000		1,544		1,492		52
2001		2,478		2,332		146
2002		1,475		1,360		115
2003		1,679		1,486		193
2004		1,621		1,355		266
2005		2,114		1,670		444
2006		3,461		2,437		1,024
2007		2,962		1,756		1,206
2008		4,194		1,758		2,436
2009		3,948		794		3,154
2010		2,456		93		2,363
Total		41,030		29,560		11,470

Milliman

WSC Direct Business
Exhibit E19

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		7,197		7,197		7,197		0		0		0
1990		8,205		8,205		8,205		0		0		0
1991		5,927		5,927		5,927		0		0		0
1992		5,952		5,952		5,952		0		0		0
1993		6,114		6,114		6,114		0		0		0
1994		4,663		4,663		4,663		0		0		0
1995		6,502		6,474		6,458		16		28		44
1996		7,033		6,987		6,949		38		46		84
1997		6,733		6,682		6,682		0		51		51
1998		8,818		8,683		8,666		17		135		152
1999		11,341		11,105		11,103		2		236		238
2000		10,582		10,342		10,261		81		240		321
2001		15,081		14,688		14,176		512		393		905
2002		11,839		11,291		11,274		17		548		565
2003		12,513		11,731		11,674		57		782		839
2004		13,694		12,703		12,215		488		991		1,479
2005		15,496		13,880		13,345		535		1,616		2,151
2006		21,043		18,610		16,338		2,272		2,433		4,705
2007		20,886		16,224		15,227		997		4,662		5,659
2008		33,976		25,207		21,175		4,032		8,769		12,801
2009		23,455		11,008		9,292		1,716		12,447		14,163
2010		17,338		2,464		1,624		840		14,874		15,714
Total		274,388		226,137		214,517		11,620		48,251		59,871

Milliman

WSC Direct Business
Exhibit E20

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
GROSS OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		5,695		5,695		5,695		0		0		0
1990		6,343		6,343		6,343		0		0		0
1991		4,696		4,696		4,696		0		0		0
1992		4,574		4,574		4,574		0		0		0
1993		4,644		4,644		4,644		0		0		0
1994		3,638		3,638		3,638		0		0		0
1995		5,390		5,368		5,352		16		22		38
1996		5,574		5,538		5,500		38		36		74
1997		5,272		5,228		5,228		0		44		44
1998		7,175		7,057		7,040		17		118		135
1999		9,048		8,843		8,841		2		205		207
2000		8,992		8,804		8,723		81		188		269
2001		12,572		12,325		11,813		512		247		759
2002		10,364		9,930		9,913		17		434		451
2003		10,834		10,246		10,189		57		588		645
2004		12,073		11,349		10,861		488		724		1,212
2005		13,382		12,211		11,675		536		1,171		1,707
2006		17,582		16,174		13,902		2,272		1,408		3,680
2007		17,924		14,469		13,472		997		3,455		4,452
2008		29,782		23,449		19,416		4,033		6,333		10,366
2009		19,507		10,214		8,498		1,716		9,293		11,009
2010		14,882		2,371		1,531		840		12,511		13,351
Total		229,943		193,166		181,544		11,622		36,777		48,399

Milliman

WSC Direct Business
Exhibit E21

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		0		0		0		0		0		0
1990		0		0		0		0		0		0
1991		0		0		0		0		0		0
1992		0		0		0		0		0		0
1993		0		0		0		0		0		0
1994		0		0		0		0		0		0
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		0		0		0		0		0		0
1998		0		0		0		0		0		0
1999		0		0		0		0		0		0
2000		0		0		0		0		0		0
2001		0		0		0		0		0		0
2002		436		410		409		0		26		27
2003		603		568		566		2		35		37
2004		700		657		628		29		43		72
2005		464		394		373		22		70		91
2006		67		61		58		3		6		9
2007		25		20		17		3		5		8
2008		10		7		7		0		3		3
2009		1		0		0		0		1		1
2010		1		0		0		0		1		1
Total		2,307		2,118		2,057		60		190		250

Milliman

WSC Direct Business
Exhibit E22

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
NET OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		5,695		5,695		5,695		0		0		0
1990		6,343		6,343		6,343		0		0		0
1991		4,696		4,696		4,696		0		0		0
1992		4,574		4,574		4,574		0		0		0
1993		4,644		4,644		4,644		0		0		0
1994		3,638		3,638		3,638		0		0		0
1995		5,390		5,368		5,352		16		22		38
1996		5,574		5,538		5,500		38		36		74
1997		5,272		5,228		5,228		0		44		44
1998		7,175		7,057		7,040		17		118		135
1999		9,048		8,843		8,841		2		205		207
2000		8,992		8,804		8,723		81		188		269
2001		12,572		12,325		11,813		512		247		759
2002		9,928		9,520		9,504		17		408		424
2003		10,231		9,678		9,623		55		553		608
2004		11,373		10,692		10,233		459		681		1,140
2005		12,918		11,817		11,302		514		1,101		1,616
2006		17,515		16,113		13,844		2,269		1,402		3,671
2007		17,899		14,449		13,455		994		3,450		4,444
2008		29,772		23,442		19,409		4,033		6,330		10,363
2009		19,506		10,214		8,498		1,716		9,292		11,008
2010		14,881		2,371		1,531		840		12,510		13,350
Total		227,636		191,048		179,487		11,563		36,587		48,150

Milliman

WSC Direct Business
Exhibit E23

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
GROSS OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		1,194		1,194		0
1990		1,278		1,278		0
1991		838		838		0
1992		975		975		0
1993		931		931		0
1994		611		611		0
1995		954		948		6
1996		998		988		10
1997		1,166		1,159		7
1998		1,444		1,427		17
1999		2,171		2,140		31
2000		1,527		1,475		52
2001		2,469		2,323		146
2002		1,475		1,360		115
2003		1,679		1,488		191
2004		1,621		1,354		267
2005		2,114		1,672		442
2006		3,461		2,436		1,025
2007		2,962		1,757		1,205
2008		4,194		1,758		2,436
2009		3,948		794		3,154
2010		2,456		93		2,363
Total		40,466		28,999		11,467

Milliman

WSC Direct Business
Exhibit E24

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		0		0		0
1990		0		0		0
1991		0		0		0
1992		0		0		0
1993		0		0		0
1994		0		0		0
1995		0		0		0
1996		0		0		0
1997		0		0		0
1998		0		0		0
1999		0		0		0
2000		0		0		0
2001		0		0		0
2002		67		60		7
2003		97		86		11
2004		94		78		16
2005		88		61		27
2006		19		15		4
2007		7		5		2
2008		1		0		1
2009		0		0		0
2010		0		0		0
Total		373		305		68

Milliman

WSC Direct Business
Exhibit E25

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
NET OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		1,194		1,194		0
1990		1,278		1,278		0
1991		838		838		0
1992		975		975		0
1993		931		931		0
1994		611		611		0
1995		954		948		6
1996		998		988		10
1997		1,166		1,159		7
1998		1,444		1,427		17
1999		2,171		2,140		31
2000		1,527		1,475		52
2001		2,469		2,323		146
2002		1,408		1,300		108
2003		1,582		1,402		180
2004		1,527		1,276		251
2005		2,026		1,611		415
2006		3,442		2,421		1,021
2007		2,955		1,752		1,203
2008		4,193		1,758		2,435
2009		3,948		794		3,154
2010		2,456		93		2,363
Total		40,093		28,694		11,399

Milliman

WSC Direct Business
Exhibit E26

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
GROSS OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		6,889		6,889		6,889		0		0		0
1990		7,621		7,621		7,621		0		0		0
1991		5,534		5,534		5,534		0		0		0
1992		5,549		5,549		5,549		0		0		0
1993		5,575		5,575		5,575		0		0		0
1994		4,249		4,249		4,249		0		0		0
1995		6,344		6,316		6,300		16		28		44
1996		6,572		6,526		6,488		38		46		84
1997		6,438		6,387		6,387		0		51		51
1998		8,619		8,484		8,467		17		135		152
1999		11,219		10,983		10,981		2		236		238
2000		10,519		10,279		10,198		81		240		321
2001		15,041		14,648		14,136		512		393		905
2002		11,839		11,290		11,273		17		549		566
2003		12,513		11,734		11,677		57		779		836
2004		13,694		12,703		12,215		488		991		1,479
2005		15,496		13,883		13,347		536		1,613		2,149
2006		21,043		18,610		16,338		2,272		2,433		4,705
2007		20,886		16,226		15,229		997		4,660		5,657
2008		33,976		25,207		21,174		4,033		8,769		12,802
2009		23,455		11,008		9,292		1,716		12,447		14,163
2010		17,338		2,464		1,624		840		14,874		15,714
Total		270,409		222,165		210,543		11,622		48,244		59,866

Milliman

WSC Direct Business
Exhibit E27

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		0		0		0		0		0		0
1990		0		0		0		0		0		0
1991		0		0		0		0		0		0
1992		0		0		0		0		0		0
1993		0		0		0		0		0		0
1994		0		0		0		0		0		0
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		0		0		0		0		0		0
1998		0		0		0		0		0		0
1999		0		0		0		0		0		0
2000		0		0		0		0		0		0
2001		0		0		0		0		0		0
2002		503		470		470		0		33		33
2003		700		654		651		2		46		49
2004		794		735		706		29		59		88
2005		552		456		434		22		96		118
2006		86		76		72		3		10		14
2007		32		25		22		3		7		10
2008		11		7		7		0		4		4
2009		1		0		0		0		1		1
2010		1		0		0		0		1		1
Total		2,680		2,423		2,363		60		257		317

Milliman

WSC Direct Business
Exhibit E28

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
NET OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		6,889		6,889		6,889		0		0		0
1990		7,621		7,621		7,621		0		0		0
1991		5,534		5,534		5,534		0		0		0
1992		5,549		5,549		5,549		0		0		0
1993		5,575		5,575		5,575		0		0		0
1994		4,249		4,249		4,249		0		0		0
1995		6,344		6,316		6,300		16		28		44
1996		6,572		6,526		6,488		38		46		84
1997		6,438		6,387		6,387		0		51		51
1998		8,619		8,484		8,467		17		135		152
1999		11,219		10,983		10,981		2		236		238
2000		10,519		10,279		10,198		81		240		321
2001		15,041		14,648		14,136		512		393		905
2002		11,336		10,820		10,803		17		516		533
2003		11,813		11,080		11,026		55		733		787
2004		12,900		11,968		11,509		459		932		1,391
2005		14,944		13,427		12,913		514		1,517		2,031
2006		20,957		18,534		16,266		2,269		2,423		4,691
2007		20,854		16,201		15,207		994		4,653		5,647
2008		33,965		25,200		21,167		4,033		8,765		12,798
2009		23,454		11,008		9,292		1,716		12,446		14,162
2010		17,337		2,464		1,624		840		14,873		15,713
Total		267,729		219,742		208,180		11,563		47,987		59,548

Milliman

WSC Direct Business
Exhibit F1

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Loss Salvage & Subrogation Recovered* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		44		149		264		408		551		703		1,005		1,094		1,141		1,208		1,220		1,246		1,255		1,259		1,277		1,281		1,300		1,302		1,304		1,306		1,308		1,310
1990		11		79		204		331		579		718		812		874		990		1,057		1,077		1,096		1,127		1,133		1,143		1,146		1,148		1,150		1,151		1,153		1,164
1991		26		153		293		404		485		567		774		892		918		962		995		1,012		1,034		1,040		1,047		1,057		1,060		1,064		1,067		1,069
1992		74		204		356		508		592		655		710		792		839		868		875		880		892		896		897		898		898		899		899
1993		10		223		497		757		868		1,039		1,081		1,116		1,135		1,163		1,172		1,189		1,196		1,212		1,215		1,219		1,287		1,289
1994		60		458		558		704		784		819		855		886		896		931		937		946		952		956		956		956		956
1995		67		261		513		712		766		884		953		988		1,020		1,087		1,177		1,206		1,230		1,263		1,277		1,291
1996		21		157		322		546		721		911		1,002		1,145		1,190		1,211		1,223		1,233		1,238		1,243		1,247
1997		202		485		697		785		902		1,030		1,090		1,146		1,182		1,194		1,214		1,220		1,224		1,227
1998		84		291		499		662		925		1,133		1,175		1,505		1,539		1,559		1,648		1,674		1,736
1999		97		380		651		770		862		967		1,389		1,411		1,435		1,457		1,476		1,490
2000		180		446		965		1,159		1,339		1,438		1,493		1,527		1,566		1,588		1,597
2001		190		563		968		1,204		1,724		1,862		2,028		2,082		2,139		2,211
2002		68		467		736		912		1,414		1,560		1,632		1,747		1,803
2003		42		1,085		1,427		1,804		1,945		2,046		2,118		2,148
2004		175		575		932		1,316		1,510		1,630		1,723
2005		94		391		780		1,156		1,513		1,603
2006		289		585		865		1,786		1,991
2007		127		718		1,117		1,344
2008		1,303		1,708		2,525
2009		139		606
2010		214

* Last diagonal is as of 9/30/10.

Accident	Salvage & Subrogation Recovered Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989		3.386		1.772		1.545		1.350		1.276		1.430		1.089		1.043		1.059		1.010		1.021		1.007		1.003		1.014		1.003		1.015		1.002		1.002		1.002		1.002		1.002
1990		7.182		2.582		1.623		1.749		1.240		1.131		1.076		1.133		1.068		1.019		1.018		1.028		1.005		1.009		1.003		1.002		1.002		1.001		1.002		1.013
1991		5.885		1.915		1.379		1.200		1.169		1.365		1.152		1.029		1.048		1.034		1.017		1.022		1.006		1.007		1.010		1.003		1.004		1.003		1.002
1992		2.757		1.745		1.427		1.165		1.106		1.084		1.115		1.059		1.035		1.008		1.006		1.014		1.004		1.001		1.001		1.000		1.001		1.000
1993		22.300		2.229		1.523		1.147		1.197		1.040		1.032		1.017		1.025		1.008		1.015		1.006		1.013		1.002		1.003		1.056		1.002
1994		7.633		1.218		1.262		1.114		1.045		1.044		1.036		1.011		1.039		1.006		1.010		1.006		1.004		1.000		1.000		1.000
1995		3.896		1.966		1.388		1.076		1.154		1.078		1.037		1.032		1.066		1.083		1.025		1.020		1.027		1.011		1.015
1996		7.476		2.051		1.696		1.321		1.264		1.100		1.143		1.039		1.018		1.010		1.008		1.004		1.004		1.004
1997		2.401		1.437		1.126		1.149		1.142		1.058		1.051		1.031		1.010		1.017		1.005		1.003		1.003
1998		3.464		1.715		1.327		1.397		1.225		1.037		1.281		1.023		1.013		1.057		1.016		1.050
1999		3.918		1.713		1.183		1.119		1.122		1.436		1.016		1.017		1.015		1.013		1.013
2000		2.478		2.164		1.201		1.155		1.074		1.038		1.023		1.026		1.014		1.008
2001		2.963		1.719		1.244		1.432		1.080		1.089		1.027		1.027		1.045
2002		6.868		1.576		1.239		1.550		1.103		1.046		1.070		1.043
2003		25.833		1.315		1.264		1.078		1.052		1.035		1.019
2004		3.286		1.621		1.412		1.147		1.079		1.077
2005		4.160		1.995		1.482		1.309		1.080
2006		2.024		1.479		2.065		1.156
2007		5.654		1.556		1.280
2008		1.311		1.684
2009		7.119

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Average	6.285	1.773	1.403	1.256	1.142	1.131	1.078	1.038	1.035	1.023	1.014	1.016	1.008	1.006	1.005	1.013	1.002	1.001	1.002	1.007	1.002
Average x H/L	5.518	1.758	1.381	1.237	1.139	1.116	1.067	1.032	1.034	1.018	1.014	1.013	1.006	1.006	1.004	1.005	1.002	1.001	1.002
Col Sum	3.139	1.655	1.372	1.227	1.121	1.106	1.069	1.035	1.033	1.023	1.014	1.017	1.008	1.006	1.005	1.014	1.002	1.001	1.002	1.007	1.002
Col Sum L5	2.250	1.652	1.463	1.211	1.077	1.057	1.031	1.028	1.022	1.022	1.013	1.019	1.011	1.004	1.006	1.014	1.002
Selected	2.250	1.652	1.463	1.211	1.077	1.057	1.031	1.028	1.028	1.022	1.014	1.017	1.006	1.006	1.005	1.004	1.003	1.002	1.002	1.002	1.001

	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		8.903		3.957		2.395		1.637		1.352		1.255		1.187		1.151		1.120		1.090		1.067		1.052		1.034		1.028		1.022		1.017		1.013		1.010		1.008		1.006		1.004		1.003
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		12.691		4.846		2.715		1.800		1.418		1.278		1.204		1.160		1.128		1.097		1.073		1.056		1.038		1.030		1.024		1.018		1.014		1.011		1.009		1.007		1.005		1.003

Milliman

WSC Direct Business
Exhibit F2

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Loss Salvage & Subrogation Recovered Development Projection Method ($000s)

	(1)		(2)		(3)
					[(1)*(2)]
					Projected
					Ultimate
			Cumulative		Loss
	Sal/Sub		Development		Sal/Sub
Accident	Recovered		Factors		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10
1989		1,310		1.003		1,314
1990		1,164		1.005		1,170
1991		1,069		1.007		1,076
1992		899		1.009		907
1993		1,289		1.011		1,303
1994		956		1.014		969
1995		1,291		1.018		1,314
1996		1,247		1.024		1,277
1997		1,227		1.030		1,264
1998		1,736		1.038		1,802
1999		1,490		1.056		1,573
2000		1,597		1.073		1,714
2001		2,211		1.097		2,425
2002		1,803		1.128		2,034
2003		2,148		1.160		2,492
2004		1,723		1.204		2,074
2005		1,603		1.278		2,049
2006		1,991		1.418		2,823
2007		1,344		1.800		2,419
2008		2,525		2.715		6,855
2009		606		4.846		2,937
2010		214		12.691		2,037
Total		31,443				43,828

Note: The 9-Ult Cumulative Development Factor was interpolated using curve fitting methods. The Projected Ultimate Sal/Sub for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit F3

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Paid Loss* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		363		1,937		3,595		4,652		5,145		5,543		5,697		5,713		5,764		5,798		5,856		5,865		5,866		5,882		5,882		5,882		5,882		5,882		5,907		5,907		5,907		5,907
1990		310		2,107		3,309		4,193		4,894		5,484		5,569		5,870		6,046		6,429		6,532		6,541		6,622		6,805		6,805		6,805		6,805		6,809		6,809		6,809		6,809
1991		373		2,197		3,136		3,631		4,132		4,414		4,562		4,726		4,762		4,790		4,799		4,987		5,009		5,019		5,029		5,029		5,029		5,029		5,029		5,029
1992		574		2,085		2,987		4,340		4,664		4,756		4,799		4,859		4,877		4,910		4,918		4,918		4,918		4,921		4,921		4,921		4,921		4,921		4,921
1993		384		2,125		3,216		3,938		4,351		4,438		4,902		4,956		4,963		4,973		4,976		4,976		4,980		5,130		5,131		5,131		5,131		5,131
1994		274		1,542		2,424		3,085		3,172		3,286		3,545		3,586		3,986		3,992		3,992		3,992		3,999		3,999		3,999		3,999		3,999
1995		370		2,375		3,514		4,069		4,254		4,393		4,740		5,007		5,206		5,408		5,487		5,487		5,487		5,487		5,487		5,487
1996		402		1,886		3,155		4,345		4,873		5,350		5,625		5,775		5,819		5,868		5,877		5,877		5,908		5,908		5,908
1997		641		2,614		3,445		4,090		4,572		4,828		5,097		5,162		5,188		5,305		5,310		5,310		5,508		5,508
1998		709		2,341		3,550		4,497		5,346		6,105		6,645		6,896		6,983		7,194		7,219		7,234		7,234
1999		758		3,722		5,517		6,588		7,123		7,300		7,400		8,536		8,798		8,880		8,920		8,956
2000		857		3,533		6,320		7,286		7,952		8,273		8,412		8,713		8,753		8,757		8,769
2001		1,353		5,578		8,481		9,761		10,303		10,712		10,936		11,626		11,746		11,844
2002		1,428		5,208		7,657		8,669		9,148		9,555		9,864		9,907		9,914
2003		1,581		6,224		7,745		8,616		9,089		9,764		10,155		10,188
2004		1,845		6,290		8,018		9,384		10,357		10,611		10,860
2005		2,463		6,354		8,877		10,396		11,484		11,675
2006		2,359		6,553		9,878		12,637		13,901
2007		1,637		7,242		11,801		13,471
2008		5,584		15,169		19,417
2009		3,224		8,498
2010		1,531

* Last diagonal is as of 9/30/10.

Milliman

WSC Direct Business
Exhibit F4

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Loss*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0.121		0.077		0.073		0.088		0.107		0.127		0.176		0.191		0.198		0.208		0.208		0.212		0.214		0.214		0.217		0.218		0.221		0.221		0.221		0.221		0.221		0.222
1990		0.035		0.037		0.062		0.079		0.118		0.131		0.146		0.149		0.164		0.164		0.165		0.168		0.170		0.166		0.168		0.168		0.169		0.169		0.169		0.169		0.171
1991		0.070		0.070		0.093		0.111		0.117		0.128		0.170		0.189		0.193		0.201		0.207		0.203		0.206		0.207		0.208		0.210		0.211		0.212		0.212		0.213
1992		0.129		0.098		0.119		0.117		0.127		0.138		0.148		0.163		0.172		0.177		0.178		0.179		0.181		0.182		0.182		0.182		0.182		0.183		0.183
1993		0.026		0.105		0.155		0.192		0.199		0.234		0.221		0.225		0.229		0.234		0.236		0.239		0.240		0.236		0.237		0.238		0.251		0.251
1994		0.219		0.297		0.230		0.228		0.247		0.249		0.241		0.247		0.225		0.233		0.235		0.237		0.238		0.239		0.239		0.239		0.239
1995		0.181		0.110		0.146		0.175		0.180		0.201		0.201		0.197		0.196		0.201		0.215		0.220		0.224		0.230		0.233		0.235
1996		0.052		0.083		0.102		0.126		0.148		0.170		0.178		0.198		0.205		0.206		0.208		0.210		0.210		0.210		0.211
1997		0.315		0.186		0.202		0.192		0.197		0.213		0.214		0.222		0.228		0.225		0.229		0.230		0.222		0.223
1998		0.118		0.124		0.141		0.147		0.173		0.186		0.177		0.218		0.220		0.217		0.228		0.231		0.240
1999		0.128		0.102		0.118		0.117		0.121		0.132		0.188		0.165		0.163		0.164		0.165		0.166
2000		0.210		0.126		0.153		0.159		0.168		0.174		0.177		0.175		0.179		0.181		0.182
2001		0.140		0.101		0.114		0.123		0.167		0.174		0.185		0.179		0.182		0.187
2002		0.048		0.090		0.096		0.105		0.155		0.163		0.165		0.176		0.182
2003		0.027		0.174		0.184		0.209		0.214		0.210		0.209		0.211
2004		0.095		0.091		0.116		0.140		0.146		0.154		0.159
2005		0.038		0.062		0.088		0.111		0.132		0.137
2006		0.123		0.089		0.088		0.141		0.143
2007		0.078		0.099		0.095		0.100
2008		0.233		0.113		0.130
2009		0.043		0.071
2010		0.140

* Last diagonal is as of 9/30/10.

Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989		0.635		0.955		1.194		1.221		1.184		1.391		1.086		1.034		1.053		1.000		1.020		1.007		1.000		1.014		1.003		1.015		1.002		0.997		1.002		1.002		1.002
1990		1.057		1.644		1.280		1.499		1.107		1.114		1.021		1.100		1.004		1.003		1.016		1.016		0.978		1.009		1.003		1.002		1.001		1.001		1.002		1.013
1991		0.999		1.342		1.191		1.055		1.094		1.321		1.112		1.021		1.042		1.032		0.979		1.017		1.004		1.005		1.010		1.003		1.004		1.003		1.002
1992		0.759		1.218		0.982		1.084		1.085		1.074		1.102		1.055		1.028		1.006		1.006		1.014		1.004		1.001		1.001		1.000		1.001		1.000
1993		4.030		1.473		1.244		1.038		1.174		0.942		1.021		1.016		1.023		1.007		1.015		1.005		0.984		1.002		1.003		1.056		1.002
1994		1.356		0.775		0.991		1.083		1.008		0.968		1.024		0.910		1.038		1.006		1.010		1.005		1.004		1.000		1.000		1.000
1995		0.607		1.328		1.199		1.029		1.118		0.999		0.981		0.993		1.026		1.067		1.025		1.020		1.027		1.011		1.015
1996		1.594		1.226		1.231		1.177		1.151		1.046		1.113		1.031		1.009		1.008		1.008		0.999		1.004		1.004
1997		0.589		1.090		0.949		1.028		1.081		1.002		1.038		1.026		0.988		1.016		1.005		0.967		1.003
1998		1.049		1.131		1.047		1.175		1.073		0.953		1.234		1.010		0.983		1.053		1.014		1.050
1999		0.798		1.156		0.991		1.035		1.095		1.417		0.881		0.987		1.006		1.008		1.007
2000		0.601		1.210		1.042		1.059		1.032		1.021		0.987		1.021		1.014		1.006
2001		0.719		1.131		1.081		1.357		1.039		1.067		0.966		1.017		1.034
2002		1.883		1.072		1.094		1.469		1.056		1.013		1.066		1.042
2003		6.562		1.057		1.136		1.022		0.979		0.995		1.015
2004		0.964		1.272		1.206		1.040		1.054		1.044
2005		1.612		1.428		1.266		1.185		1.057
2006		0.729		0.981		1.614		1.018
2007		1.278		0.955		1.073
2008		0.483		1.212
2009		1.956

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Average	1.441	1.183	1.148	1.143	1.082	1.085	1.043	1.019	1.019	1.018	1.009	1.010	1.001	1.006	1.005	1.013	1.002	1.000	1.002	1.007	1.002
Average x H/L	1.222	1.180	1.132	1.129	1.081	1.072	1.041	1.021	1.019	1.015	1.011	1.010	1.000	1.005	1.004	1.005	1.002	1.000	1.002
Avg L5 x H/L	1.206	1.155	1.203	1.082	1.050	1.026	0.989	1.016	1.002	1.011	1.010	1.008	1.004	1.003	1.005	1.002	1.002
Selected	1.441	1.155	1.132	1.129	1.081	1.072	1.041	1.021	1.019	1.015	1.011	1.010	1.004	1.005	1.004	1.003	1.002	1.002	1.002	1.001	1.001

	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		2.836		1.968		1.704		1.505		1.333		1.233		1.150		1.105		1.082		1.062		1.046		1.035		1.025		1.021		1.016		1.012		1.009		1.007		1.005		1.003		1.002		1.001
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		N/A		2.156		1.767		1.552		1.374		1.257		1.170		1.116		1.088		1.067		1.050		1.038		1.028		1.022		1.017		1.013		1.010		1.008		1.006		1.004		1.002		1.001

Milliman

WSC Direct Business
Exhibit F5

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Loss ($000s)

	(1)		(2)		(3)		(4)		(5)
					[(1)*(2)]				[(3) * (4)]
									Projected
			Cumulative						Ultimate
			Ratio		Projected		Gross		Loss
			Development		Ultimate		Ultimate		Sal/Sub
Accident	Ratio		Factors		Ratio		Loss		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1989		0.222		1.001		0.222		5,907		1,311
1990		0.171		1.002		0.171		6,809		1,164
1991		0.213		1.004		0.213		5,029		1,071
1992		0.183		1.006		0.184		4,921		905
1993		0.251		1.008		0.253		5,131		1,298
1994		0.239		1.010		0.241		3,999		964
1995		0.235		1.013		0.238		5,525		1,315
1996		0.211		1.017		0.215		5,982		1,286
1997		0.223		1.022		0.228		5,552		1,266
1998		0.240		1.028		0.247		7,369		1,820
1999		0.166		1.038		0.173		9,163		1,585
2000		0.182		1.050		0.191		9,038		1,726
2001		0.187		1.067		0.199		12,603		2,508
2002		0.182		1.088		0.198		10,364		2,052
2003		0.211		1.116		0.235		10,834		2,546
2004		0.159		1.170		0.186		12,073		2,246
2005		0.137		1.257		0.173		13,382		2,315
2006		0.143		1.374		0.197		17,582		3,464
2007		0.100		1.552		0.155		17,924		2,778
2008		0.130		1.767		0.230		29,782		6,850
2009		0.071		2.156		0.154		19,507		3,004
2010		0.140		N/A		N/A		14,882		N/A
Total								233,358		43,474

Milliman

WSC Direct Business
Exhibit F6

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Bornhuetter — Ferguson Projection ($000s)

	2007		2008		2009
1) A-Priori Salvage & Subrogation Ratio at 9/30/10*		0.190		0.190		0.190
2) Selected Ultimate Loss at 9/30/10		17,924		29,782		19,507
3) A-Priori Ultimate Salvage & Subrogation at 9/30/10 (1) x (2)		3,406		5,659		3,706
4) Estimated % Unrecovered [1-1/CDF]		0.444		0.632		0.794
5) Estimated Future Salvage & Subrogation Recoverables at 9/30/10 (3) x (4)		1,512		3,576		2,943
6) Actual Salvage & Subrogation Recovered to Date		1,344		2,525		606
7) Indicated Ultimate Salvage & Subrogation (5) + (6)		2,856		6,101		3,549

* Based on the average Salvage & Subrogation Ratios for 1999-2006.

Milliman

WSC Direct Business
Exhibit F7

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Selection of Ultimate Loss Salvage & Subrogation ($000s)

			Ultimate		Ultimate		Ultimate
			Sal/Sub		Sal/Sub		Sal/Sub				Selected
	Gross		Indicated by		Indicated by		Indicated by				Ultimate
	Ultimate		Dollar		Ratio		Bornhuetter-		Selected		Sal/Sub
Accident	Loss		Development		Development		Ferguson		Ultimate		to Ultimate
Year	@9/30/10		Method		Method		Method		Sal/Sub		Loss Ratio
1989		5,907		1,314		1,311	xxx			1,310		0.222
1990		6,809		1,170		1,164	xxx			1,164		0.171
1991		5,029		1,076		1,071	xxx			1,069		0.213
1992		4,921		907		905	xxx			899		0.183
1993		5,131		1,303		1,298	xxx			1,289		0.251
1994		3,999		969		964	xxx			956		0.239
1995		5,525		1,314		1,315	xxx			1,291		0.234
1996		5,982		1,277		1,286	xxx			1,247		0.208
1997		5,552		1,264		1,266	xxx			1,265		0.228
1998		7,369		1,802		1,820	xxx			1,811		0.246
1999		9,163		1,573		1,585	xxx			1,579		0.172
2000		9,038		1,714		1,726	xxx			1,720		0.190
2001		12,603		2,425		2,508	xxx			2,425		0.192
2002		10,364		2,034		2,052	xxx			2,043		0.197
2003		10,834		2,492		2,546	xxx			2,519		0.233
2004		12,073		2,074		2,246	xxx			2,160		0.179
2005		13,382		2,049		2,315	xxx			2,182		0.163
2006		17,582		2,823		3,464	xxx			3,144		0.179
2007		17,924		2,419		2,778		2,856		2,856		0.159
2008		29,782		6,855		6,850		6,101		6,101		0.205
2009		19,507		2,937		3,004		3,549		3,549		0.182
2010		14,882		2,037		N/A	xxx			2,768		0.186
Total		233,358		43,828		43,474				45,347		0.194

Note: Ultimate Salvage & Subrogation for 2010 is based on an Ultimate Sal/Sub Ratio of 18.6%, which is the weighted average of 2003-2009.

Milliman

WSC Direct Business
Exhibit F8

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		1,310		1,310		0
1990		1,164		1,164		0
1991		1,069		1,069		0
1992		899		899		0
1993		1,289		1,289		0
1994		956		956		0
1995		1,291		1,291		0
1996		1,247		1,247		0
1997		1,265		1,227		38
1998		1,811		1,736		75
1999		1,579		1,490		89
2000		1,720		1,597		123
2001		2,425		2,211		214
2002		2,043		1,803		240
2003		2,519		2,148		371
2004		2,160		1,723		437
2005		2,182		1,603		579
2006		3,144		1,991		1,153
2007		2,856		1,344		1,512
2008		6,101		2,525		3,576
2009		3,549		606		2,943
2010		2,768		214		2,554
Total		45,347		31,443		13,904

Milliman

WSC Direct Business
Exhibit F9

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
GROSS OF THE QUOTA SHARE TREATIES
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		1,257		1,257		0
1990		1,088		1,088		0
1991		1,036		1,036		0
1992		845		845		0
1993		1,257		1,257		0
1994		946		946		0
1995		1,184		1,184		0
1996		1,209		1,209		0
1997		1,018		980		38
1998		1,763		1,688		75
1999		1,517		1,428		89
2000		1,695		1,572		123
2001		2,419		2,205		214
2002		2,043		1,804		239
2003		2,519		2,148		371
2004		2,160		1,721		439
2005		2,182		1,600		582
2006		3,144		1,990		1,154
2007		2,856		1,346		1,510
2008		6,101		2,526		3,575
2009		3,549		606		2,943
2010		2,768		214		2,554
Total		44,556		30,650		13,906

Milliman

WSC Direct Business
Exhibit F10

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
QUOTA SHARE TREATIES
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		0		0		0
1990		0		0		0
1991		0		0		0
1992		0		0		0
1993		0		0		0
1994		0		0		0
1995		0		0		0
1996		0		0		0
1997		0		0		0
1998		0		0		0
1999		0		0		0
2000		0		0		0
2001		0		0		0
2002		85		71		14
2003		101		79		22
2004		114		88		26
2005		91		56		35
2006		11		6		5
2007		3		1		2
2008		2		0		2
2009		0		0		0
2010		0		0		0
Total		407		301		106

Milliman

WSC Direct Business
Exhibit F11

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET COMMERCIAL SURETY
NET OF THE QUOTA SHARE TREATIES
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		1,257		1,257		0
1990		1,088		1,088		0
1991		1,036		1,036		0
1992		845		845		0
1993		1,257		1,257		0
1994		946		946		0
1995		1,184		1,184		0
1996		1,209		1,209		0
1997		1,018		980		38
1998		1,763		1,688		75
1999		1,517		1,428		89
2000		1,695		1,572		123
2001		2,419		2,205		214
2002		1,958		1,733		225
2003		2,418		2,069		349
2004		2,046		1,633		413
2005		2,091		1,544		547
2006		3,133		1,984		1,149
2007		2,853		1,345		1,508
2008		6,099		2,526		3,573
2009		3,549		606		2,943
2010		2,768		214		2,554
Total		44,149		30,349		13,800

Milliman

WSC Direct Business
Exhibit G1

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		93		562		964		1,022		1,036		1,045		1,057		1,083		1,095		1,095		1,095		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096
1990		89		413		843		1,121		1,166		1,203		1,215		1,225		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235
1991		112		502		734		858		873		918		965		961		1,017		1,042		1,042		1,060		1,060		1,070		1,070		1,070		1,070		1,090		1,090		1,090
1992		109		460		810		931		964		1,083		1,111		1,116		1,116		1,116		1,216		1,216		1,216		1,216		1,226		1,226		1,226		1,226		1,226
1993		109		612		1,013		1,246		1,396		1,439		1,443		1,503		1,503		1,503		1,504		1,504		1,504		1,504		1,504		1,504		1,504		1,504
1994		75		522		942		1,133		1,261		1,430		1,481		1,523		1,533		1,533		1,533		1,533		1,533		1,533		1,533		1,533		1,533
1995		150		667		1,044		1,234		1,279		1,426		1,537		1,537		1,537		1,537		1,537		1,537		1,537		1,637		1,637		1,637
1996		427		888		1,243		1,418		1,477		1,477		1,477		1,479		1,479		1,479		1,479		1,479		1,479		1,479		1,479
1997		82		497		962		1,466		1,573		1,665		1,722		1,728		1,745		1,745		1,745		1,745		1,745		1,745
1998		82		515		709		820		824		882		902		907		907		907		932		932		934
1999		124		544		679		872		984		1,111		1,111		1,112		1,112		1,112		1,112		1,112
2000		71		369		646		710		740		810		837		837		838		838		838
2001		77		1,130		1,376		1,655		1,753		1,824		1,827		1,827		1,852		1,852
2002		173		740		933		1,209		1,246		1,252		1,289		1,289		1,289
2003		66		668		981		1,152		1,349		1,659		1,661		1,661
2004		92		629		1,196		1,411		1,566		1,568		1,617
2005		478		910		1,417		1,614		1,812		1,942
2006		269		965		1,236		1,519		1,544
2007		88		588		1,072		1,467
2008		236		623		952
2009		508		810
2010		42

* Last Diagonal is as of 9/30/10.

	Paid Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		6.043		1.715		1.060		1.014		1.009		1.011		1.025		1.011		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		4.640		2.041		1.330		1.040		1.032		1.010		1.008		1.008		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		4.482		1.462		1.169		1.017		1.052		1.051		0.996		1.058		1.025		1.000		1.017		1.000		1.009		1.000		1.000		1.000		1.019		1.000		1.000
1992		4.220		1.761		1.149		1.035		1.123		1.026		1.005		1.000		1.000		1.090		1.000		1.000		1.000		1.008		1.000		1.000		1.000		1.000
1993		5.615		1.655		1.230		1.120		1.031		1.003		1.042		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		6.960		1.805		1.203		1.113		1.134		1.036		1.028		1.007		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		4.447		1.565		1.182		1.036		1.115		1.078		1.000		1.000		1.000		1.000		1.000		1.000		1.065		1.000		1.000
1996		2.080		1.400		1.141		1.042		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		6.061		1.936		1.524		1.073		1.058		1.034		1.003		1.010		1.000		1.000		1.000		1.000		1.000
1998		6.280		1.377		1.157		1.005		1.070		1.023		1.006		1.000		1.000		1.028		1.000		1.003
1999		4.387		1.248		1.284		1.128		1.129		1.000		1.001		1.000		1.000		1.000		1.000
2000		5.197		1.751		1.099		1.042		1.095		1.033		1.000		1.001		1.000		1.000
2001		14.675		1.218		1.203		1.059		1.041		1.002		1.000		1.014		1.000
2002		4.277		1.261		1.296		1.031		1.005		1.030		1.000		1.000
2003		10.121		1.469		1.174		1.171		1.230		1.001		1.000
2004		6.837		1.901		1.180		1.110		1.001		1.042
2005		1.904		1.557		1.139		1.123		1.097
2006		3.587		1.281		1.229		1.022
2007		6.682		1.823		1.519
2008		2.640		1.760
2009		1.863
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	5.381	1.599	1.225	1.066	1.072	1.024	1.008	1.008	1.002	1.010	1.002	1.000	1.008	1.001	1.000	1.000	1.004	1.000	1.000	1.000	1.000
Latest 5	3.335	1.665	1.248	1.091	1.075	1.022	1.000	1.003	1.000	1.006	1.000	1.001	1.013	1.002	1.000	1.000	1.004	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	5.077	1.596	1.217	1.063	1.066	1.022	1.006	1.004	1.000	1.003	1.000	1.000	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	2.710	1.713	1.194	1.088	1.047	1.022	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	3.917	1.554	1.224	1.068	1.070	1.023	1.008	1.007	1.001	1.008	1.001	1.000	1.009	1.001	1.000	1.000	1.003	1.000	1.000	1.000	1.000
Latest 5	2.554	1.620	1.241	1.090	1.073	1.019	1.000	1.004	1.000	1.004	1.000	1.000	1.013	1.001	1.000	1.000	1.003	1.000	1.000	1.000	1.000
Latest 3	2.593	1.565	1.278	1.085	1.103	1.023	1.000	1.007	1.000	1.009	1.000	1.001	1.021	1.000	1.000	1.000	1.005	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected		3.917		1.620		1.241		1.090		1.073		1.023		1.008		1.007		1.005		1.003		1.002		1.002		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		9.726		2.483		1.533		1.235		1.133		1.056		1.032		1.024		1.017		1.012		1.009		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		15.734		3.493		1.730		1.303		1.158		1.075		1.038		1.026		1.019		1.013		1.010		1.008		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit G2

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

																			Indicated
							Cumulative Paid Loss						Indicated Ultimate						Ultimate
	Paid Losses ($000s)						Development Factors						Paid Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		1,096		1,096		1,096		1.000		1.000		1.000		1,096		1,096		1,096		1,096
1990		1,235		1,235		1,235		1.000		1.000		1.000		1,235		1,235		1,235		1,235
1991		1,090		1,090		1,090		1.000		1.000		1.000		1,090		1,090		1,090		1,090
1992		1,226		1,226		1,226		1.000		1.000		1.000		1,226		1,226		1,226		1,226
1993		1,504		1,504		1,504		1.001		1.000		1.000		1,506		1,504		1,504		1,504
1994		1,533		1,533		1,533		1.002		1.001		1.000		1,536		1,535		1,533		1,533
1995		1,637		1,637		1,637		1.003		1.002		1.001		1,642		1,640		1,639		1,639
1996		1,479		1,479		1,479		1.005		1.003		1.002		1,486		1,483		1,482		1,482
1997		1,745		1,745		1,745		1.007		1.005		1.004		1,757		1,754		1,752		1,752
1998		932		932		934		1.009		1.007		1.006		940		939		940		940
1999		1,112		1,112		1,112		1.012		1.009		1.008		1,125		1,122		1,121		1,121
2000		838		838		838		1.017		1.012		1.010		852		848		846		846
2001		1,827		1,852		1,852		1.024		1.017		1.013		1,871		1,883		1,876		1,876
2002		1,289		1,289		1,289		1.032		1.024		1.019		1,330		1,320		1,313		1,313
2003		1,659		1,661		1,661		1.056		1.032		1.026		1,752		1,714		1,704		1,704
2004		1,566		1,568		1,617		1.133		1.056		1.038		1,774		1,656		1,678		1,678
2005		1,614		1,812		1,942		1.235		1.133		1.075		1,993		2,053		2,088		2,088
2006		1,236		1,519		1,544		1.533		1.235		1.158		1,895		1,876		1,788		1,788
2007		588		1,072		1,467		2.483		1.533		1.303		1,460		1,643		1,912		1,912
2008		236		623		952		9.726		2.483		1.730		2,295		1,547		1,647		1,647
2009				508		810				9.726		3.493				4,941		2,829		2,829
2010						42						15.734						661		496

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit G3

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Incurred Losses* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		432		1,019		1,168		1,126		1,109		1,088		1,084		1,108		1,115		1,103		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096
1990		322		834		1,062		1,337		1,334		1,326		1,274		1,252		1,235		1,238		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235
1991		358		933		1,013		1,160		1,120		1,001		1,010		1,068		1,042		1,042		1,042		1,060		1,060		1,070		1,070		1,090		1,090		1,090		1,090		1,090
1992		404		1,019		1,190		1,470		1,389		1,119		1,126		1,116		1,116		1,116		1,216		1,216		1,216		1,216		1,226		1,226		1,226		1,226		1,226
1993		376		1,179		1,463		1,635		1,581		1,539		1,520		1,522		1,505		1,505		1,506		1,504		1,504		1,504		1,504		1,504		1,504		1,504
1994		378		1,516		1,790		1,674		1,519		1,522		1,528		1,533		1,538		1,538		1,533		1,533		1,533		1,533		1,533		1,533		1,533
1995		307		1,278		1,740		1,843		1,984		1,881		1,568		1,537		1,537		1,537		1,537		1,537		1,637		1,637		1,637		1,637
1996		763		1,451		1,662		1,733		1,627		1,662		1,507		1,490		1,479		1,479		1,479		1,479		1,479		1,479		1,479
1997		392		1,198		1,461		1,933		1,739		1,757		1,722		1,728		1,745		1,745		1,745		1,745		1,745		1,745
1998		437		786		1,007		1,096		901		954		969		957		957		957		982		982		949
1999		223		775		908		1,014		1,031		1,111		1,121		1,112		1,112		1,112		1,112		1,112
2000		149		496		732		766		751		843		837		837		838		838		838
2001		181		1,267		1,568		1,744		1,883		1,841		1,859		1,857		1,852		1,902
2002		173		789		1,081		1,293		1,308		1,276		1,299		1,289		1,289
2003		77		911		1,218		1,401		1,450		1,730		1,661		1,661
2004		295		1,070		1,361		1,546		1,566		1,627		1,652
2005		759		1,474		1,620		1,904		1,970		2,094
2006		450		1,454		1,801		1,715		1,649
2007		503		1,305		1,320		1,967
2008		517		917		1,168
2009		872		1,489
2010		257
*       Last Diagonal is as of 9/30/10.
	Incurred Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		2.359		1.146		0.964		0.985		0.981		0.996		1.022		1.006		0.989		0.994		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		2.590		1.273		1.259		0.998		0.994		0.961		0.983		0.986		1.002		0.998		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		2.606		1.086		1.145		0.966		0.894		1.009		1.057		0.976		1.000		1.000		1.017		1.000		1.009		1.000		1.019		1.000		1.000		1.000		1.000
1992		2.522		1.168		1.235		0.945		0.806		1.006		0.991		1.000		1.000		1.090		1.000		1.000		1.000		1.008		1.000		1.000		1.000		1.000
1993		3.136		1.241		1.118		0.967		0.973		0.988		1.001		0.989		1.000		1.001		0.999		1.000		1.000		1.000		1.000		1.000		1.000
1994		4.011		1.181		0.935		0.907		1.002		1.004		1.003		1.003		1.000		0.997		1.000		1.000		1.000		1.000		1.000		1.000
1995		4.163		1.362		1.059		1.077		0.948		0.834		0.980		1.000		1.000		1.000		1.000		1.065		1.000		1.000		1.000
1996		1.902		1.145		1.043		0.939		1.022		0.907		0.989		0.993		1.000		1.000		1.000		1.000		1.000		1.000
1997		3.056		1.220		1.323		0.900		1.010		0.980		1.003		1.010		1.000		1.000		1.000		1.000		1.000
1998		1.799		1.281		1.088		0.822		1.059		1.016		0.988		1.000		1.000		1.026		1.000		0.955
1999		3.475		1.172		1.117		1.017		1.078		1.009		0.992		1.000		1.000		1.000		1.000
2000		3.329		1.476		1.046		0.980		1.123		0.993		1.000		1.001		1.000		1.000
2001		7.000		1.238		1.112		1.080		0.978		1.010		0.999		0.997		1.036
2002		4.561		1.370		1.196		1.012		0.976		1.018		0.992		1.000
2003		11.831		1.337		1.150		1.035		1.193		0.960		1.000
2004		3.627		1.272		1.136		1.013		1.039		1.021
2005		1.942		1.099		1.175		1.035		1.085
2006		3.231		1.239		0.952		0.949
2007		2.594		1.011		1.702
2008		1.774		1.381
2009		2.041
2010
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		3.502		1.235		1.145		0.979		1.009		0.982		1.000		0.997		1.002		1.009		1.001		1.002		1.001		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5		2.316		1.200		1.223		1.009		1.054		1.000		0.997		1.000		1.007		1.005		1.000		1.004		1.000		1.002		1.004		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		3.155		1.234		1.125		0.983		1.011		0.990		0.997		0.998		1.000		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		2.192		1.203		1.154		1.020		1.034		1.007		0.997		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs		2.802		1.220		1.138		0.981		1.006		0.976		0.999		0.998		1.003		1.007		1.001		1.004		1.001		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5		2.235		1.185		1.204		1.008		1.053		1.000		0.997		0.999		1.010		1.004		1.000		1.008		1.000		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000
Latest 3		2.115		1.193		1.237		1.000		1.102		0.997		0.998		0.999		1.018		1.009		1.000		0.990		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected		2.235		1.220		1.154		1.020		1.034		1.007		1.003		1.003		1.002		1.002		1.002		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		3.397		1.520		1.246		1.080		1.059		1.024		1.017		1.014		1.011		1.009		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		4.614		1.859		1.310		1.119		1.064		1.033		1.019		1.015		1.012		1.010		1.008		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit G4

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

																			Indicated
							Cumulative Incurred Loss						Indicated Ultimate						Ultimate
	Incurred Losses ($000s)						Development Factors						Incurred Losses ($000s)						Losses
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		1,096		1,096		1,096		1.000		1.000		1.000		1,096		1,096		1,096		1,096
1990		1,235		1,235		1,235		1.000		1.000		1.000		1,235		1,235		1,235		1,235
1991		1,090		1,090		1,090		1.000		1.000		1.000		1,090		1,090		1,090		1,090
1992		1,226		1,226		1,226		1.000		1.000		1.000		1,226		1,226		1,226		1,226
1993		1,504		1,504		1,504		1.000		1.000		1.000		1,504		1,504		1,504		1,504
1994		1,533		1,533		1,533		1.001		1.000		1.000		1,535		1,533		1,533		1,533
1995		1,637		1,637		1,637		1.002		1.001		1.000		1,640		1,639		1,637		1,637
1996		1,479		1,479		1,479		1.003		1.002		1.001		1,483		1,482		1,480		1,480
1997		1,745		1,745		1,745		1.005		1.003		1.002		1,754		1,750		1,748		1,748
1998		982		982		949		1.007		1.005		1.004		989		987		953		953
1999		1,112		1,112		1,112		1.009		1.007		1.006		1,122		1,120		1,119		1,119
2000		838		838		838		1.011		1.009		1.008		847		846		845		845
2001		1,857		1,852		1,902		1.014		1.011		1.010		1,883		1,872		1,921		1,921
2002		1,299		1,289		1,289		1.017		1.014		1.012		1,321		1,307		1,304		1,304
2003		1,730		1,661		1,661		1.024		1.017		1.015		1,772		1,689		1,686		1,686
2004		1,566		1,627		1,652		1.059		1.024		1.019		1,658		1,666		1,683		1,683
2005		1,904		1,970		2,094		1.080		1.059		1.033		2,056		2,086		2,163		2,163
2006		1,801		1,715		1,649		1.246		1.080		1.064		2,244		1,852		1,755		1,755
2007		1,305		1,320		1,967		1.520		1.246		1.119		1,984		1,645		2,201		2,201
2008		517		917		1,168		3.397		1.520		1.310		1,756		1,394		1,530		1,530
2009				872		1,489				3.397		1.859				2,962		2,768		2,768
2010						257						4.614						1,186		890

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit G5

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1989 — 2007 Ultimate Losses ($000s)

			Indicated Ultimate
			Losses Based on:
	Incurred				Incurred		Selected
Accident	Losses		Paid Loss		Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1989		1,096		1,096		1,096		1,096
1990		1,235		1,235		1,235		1,235
1991		1,090		1,090		1,090		1,090
1992		1,226		1,226		1,226		1,226
1993		1,504		1,504		1,504		1,504
1994		1,533		1,533		1,533		1,533
1995		1,637		1,639		1,637		1,637
1996		1,479		1,482		1,480		1,479
1997		1,745		1,752		1,748		1,745
1998		949		940		953		949
1999		1,112		1,121		1,119		1,112
2000		838		846		845		838
2001		1,902		1,876		1,921		1,902
2002		1,289		1,313		1,304		1,289
2003		1,661		1,704		1,686		1,661
2004		1,652		1,678		1,683		1,683
2005		2,094		2,088		2,163		2,163
2006		1,649		1,788		1,755		1,755
2007		1,967		1,912		2,201		2,201
Total		27,658		27,823		28,179		28,098

Milliman

WSC Direct Business
Exhibit G6

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection ($000s)

	Selected
	Ultimate		Gross Earned			Gross Loss
Accident	Losses		Premium			Ratio
Year	@9/30/10		@9/30/10			@9/30/10
1989		1,096		20,413			5.4	%
1990		1,235		21,697			5.7	%
1991		1,090		23,027			4.7	%
1992		1,226		24,431			5.0	%
1993		1,504		25,578			5.9	%
1994		1,533		26,348			5.8	%
1995		1,637		27,126			6.0	%
1996		1,479		27,784			5.3	%
1997		1,745		28,469			6.1	%
1998		949		16,683			5.7	%
1999		1,112		17,343			6.4	%
2000		838		18,045			4.6	%
2001		1,902		19,072			10.0	%
2002		1,289		20,106			6.4	%
2003		1,661		21,200			7.8	%
2004		1,683		22,451			7.5	%
2005		2,163		23,680			9.1	%
2006		1,755		24,567			7.1	%
2007		2,201		25,485			8.6	%
Total		28,098		433,505			6.5	%
2003-2007		9,463		117,383			8.1	%
						Loss Ratio
Accident	Gross Earned		Selected Loss			Projection
Year	Premium		Ratio			@9/30/10
2008		26,015		8.1	%		2,107
2009		25,526		8.1	%		2,068
2010		18,910		8.1	%		1,532

Milliman

WSC Direct Business
Exhibit G7

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection ($000s)

	A’priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent					Losses		Ultimate
Year	Losses*		Unreported			Indicated IBNR		@9/30/10		Losses**
2008		2,107		23.7	%		499		1,168		1,667
2009		2,068		46.2	%		955		1,489		2,444
2010		2,043		78.3	%		1,600		257		1,393
Total		6,218					3,054		2,914		5,504

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit G8

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection ($000s)

	A’priori		Estimated							Indicated
Accident	Ultimate		Percent			Indicated		Paid Losses		Ultimate
Year	Losses*		Unpaid			Unpaid		@9/30/10		Losses**
2008		2,107		42.2	%		889		952		1,841
2009		2,068		71.4	%		1,477		810		2,287
2010		2,043		93.6	%		1,912		42		1,466
Total		6,218					4,278		1,804		5,594

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit G9

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2008 — 2010 Ultimate Losses ($000s)

					Indicated Ultimate Losses* Based on:										Selected
	Incurred		Gross				Incurred								Ultimate		Ultimate
Accident	Losses		Earned		Paid Loss		Loss		Incurred B/F		Paid B/F		Loss Ratio		Losses		Loss Ratio
Year	@9/30/10		Premium*		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2008		1,168		26,015		1,647		1,530		1,667		1,841		2,107		1,599		6.1	%
2009		1,489		25,526		2,829		2,768		2,444		2,287		2,068		2,427		9.5	%
2010		257		18,910		496		890		1,393		1,466		1,532		1,463		7.7	%
Total		2,914		70,451		4,972		5,188		5,504		5,594		5,707		5,489		7.8	%

* Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Direct Business
Exhibit G10

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		1,096		1,096		1,096		0		0		0
1990		1,235		1,235		1,235		0		0		0
1991		1,090		1,090		1,090		0		0		0
1992		1,226		1,226		1,226		0		0		0
1993		1,504		1,504		1,504		0		0		0
1994		1,533		1,533		1,533		0		0		0
1995		1,637		1,637		1,637		0		0		0
1996		1,479		1,479		1,479		0		0		0
1997		1,745		1,745		1,745		0		0		0
1998		949		949		934		15		0		15
1999		1,112		1,112		1,112		0		0		0
2000		838		838		838		0		0		0
2001		1,902		1,902		1,852		50		0		50
2002		1,289		1,289		1,289		0		0		0
2003		1,661		1,661		1,661		0		0		0
2004		1,683		1,652		1,617		35		31		66
2005		2,163		2,094		1,942		152		69		221
2006		1,755		1,649		1,544		105		106		211
2007		2,201		1,967		1,467		500		234		734
2008		1,599		1,168		952		216		431		647
2009		2,427		1,489		810		679		938		1,617
2010		1,463		257		42		215		1,206		1,421
Total		33,587		30,572		28,605		1,967		3,015		4,982

Milliman

WSC Direct Business
Exhibit G11

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE* ($000s)
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		4		32		53		62		79		87		91		95		97		101		102		102		102		102		102		102		102		102		102		102		102		102
1990		1		19		53		67		90		98		109		122		136		144		145		145		145		145		145		145		145		145		145		145		145
1991		2		18		26		49		57		59		64		66		69		69		69		69		69		69		69		71		81		82		82		82
1992		1		18		43		80		94		109		112		113		113		113		113		113		113		113		113		113		113		113		113
1993		2		31		54		91		112		135		140		149		149		149		149		149		149		149		149		149		149		149
1994		2		37		107		181		219		225		232		236		236		237		237		237		237		237		237		237		237
1995		2		43		94		163		193		211		228		228		228		228		228		228		229		230		232		232
1996		5		43		83		133		170		195		195		196		197		197		197		197		197		197		197
1997		5		34		80		119		140		148		148		148		148		148		148		148		148		148
1998		1		6		13		23		27		34		38		39		40		41		41		41		43
1999		1		5		11		21		23		23		23		23		23		23		23		23
2000		0		2		4		4		4		5		6		6		6		6		6
2001		0		0		16		31		33		46		50		55		62		64
2002		2		8		12		12		15		16		17		21		22
2003		6		2		17		25		38		40		51		52
2004		0		9		19		19		21		23		25
2005		0		9		17		36		36		36
2006		0		9		12		16		16
2007		0		0		1		24
2008		0		5		23
2009		0		7
2010		1
*       Last Diagonal is as of 9/30/10.
	Paid ALAE Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		8.000		1.656		1.170		1.274		1.101		1.046		1.044		1.021		1.041		1.010		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		19.000		2.789		1.264		1.343		1.089		1.112		1.119		1.115		1.059		1.007		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		9.000		1.444		1.885		1.163		1.035		1.085		1.031		1.045		1.000		1.000		1.000		1.000		1.000		1.000		1.029		1.141		1.012		1.000		1.000
1992		18.000		2.389		1.860		1.175		1.160		1.028		1.009		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993		15.500		1.742		1.685		1.231		1.205		1.037		1.064		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		18.500		2.892		1.692		1.210		1.027		1.031		1.017		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		21.500		2.186		1.734		1.184		1.093		1.081		1.000		1.000		1.000		1.000		1.000		1.004		1.004		1.009		1.000
1996		8.600		1.930		1.602		1.278		1.147		1.000		1.005		1.005		1.000		1.000		1.000		1.000		1.000		1.000
1997		6.800		2.353		1.488		1.176		1.057		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		6.000		2.167		1.769		1.174		1.259		1.118		1.026		1.026		1.025		1.000		1.000		1.066
1999		5.000		2.200		1.909		1.095		1.000		1.000		1.000		1.000		1.000		1.000		1.000
2000				2.000		1.000		1.000		1.250		1.200		1.000		1.000		1.000		1.000
2001						1.938		1.065		1.394		1.087		1.100		1.127		1.043
2002		4.000		1.500		1.000		1.250		1.067		1.063		1.235		1.064
2003		0.333		8.500		1.471		1.520		1.053		1.275		1.026
2004				2.111		1.000		1.105		1.095		1.118
2005				1.889		2.118		1.000		1.000
2006				1.333		1.333		1.000
2007						69.228
2008				7.650
2009
2010
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		10.787		2.707		5.113		1.180		1.120		1.080		1.045		1.029		1.013		1.001		1.000		1.007		1.000		1.001		1.004		1.023		1.002		1.000		1.000		1.000		1.000
Latest 5		3.111		3.246		15.030		1.175		1.122		1.148		1.072		1.043		1.014		1.000		1.000		1.014		1.001		1.002		1.006		1.028		1.002		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		10.764		2.431		1.583		1.170		1.109		1.072		1.034		1.023		1.010		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		4.000		2.000		1.641		1.118		1.072		1.135		1.042		1.030		1.008		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs		8.706		2.231		1.680		1.208		1.103		1.052		1.030		1.020		1.011		1.001		1.000		1.003		1.001		1.002		1.002		1.012		1.002		1.000		1.000		1.000		1.000
Latest 5		1.667		2.695		2.503		1.167		1.126		1.152		1.070		1.065		1.013		1.000		1.000		1.004		1.001		1.002		1.003		1.014		1.002		1.000		1.000		1.000		1.000
Latest 3		1.250		3.589		4.041		1.028		1.042		1.186		1.088		1.102		1.029		1.000		1.000		1.007		1.002		1.003		1.000		1.000		1.003		1.000		1.000		1.000		1.000
Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected		8.706		2.231		1.680		1.208		1.103		1.072		1.034		1.020		1.011		1.008		1.004		1.003		1.002		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		50.773		5.832		2.614		1.556		1.288		1.168		1.090		1.054		1.033		1.022		1.014		1.010		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		102.558		10.018		3.195		1.771		1.350		1.197		1.109		1.063		1.038		1.025		1.016		1.011		1.008		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit G12

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

																			Indicated
							Cumulative Paid ALAE						Indicated Ultimate						Ultimate
	Paid ALAE ($000s)						Development Factors						Paid ALAE ($000s)						ALAE
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1989		102		102		102		1.000		1.000		1.000		102		102		102		102
1990		145		145		145		1.000		1.000		1.000		145		145		145		145
1991		82		82		82		1.000		1.000		1.000		82		82		82		82
1992		113		113		113		1.001		1.000		1.000		113		113		113		113
1993		149		149		149		1.002		1.001		1.000		149		149		149		149
1994		237		237		237		1.003		1.002		1.001		238		237		237		237
1995		230		232		232		1.005		1.003		1.002		231		233		232		232
1996		197		197		197		1.007		1.005		1.004		198		198		198		198
1997		148		148		148		1.010		1.007		1.006		149		149		149		149
1998		41		41		43		1.014		1.010		1.008		42		41		43		43
1999		23		23		23		1.022		1.014		1.011		24		23		23		23
2000		6		6		6		1.033		1.022		1.016		6		6		6		6
2001		55		62		64		1.054		1.033		1.025		58		64		66		66
2002		17		21		22		1.090		1.054		1.038		19		22		23		23
2003		40		51		52		1.168		1.090		1.063		47		56		55		55
2004		21		23		25		1.288		1.168		1.109		27		27		28		28
2005		36		36		36		1.556		1.288		1.197		56		46		43		43
2006		12		16		16		2.614		1.556		1.350		31		25		22		22
2007		0		1		24		5.832		2.614		1.771		0		3		43		43
2008		0		5		23		50.773		5.832		3.195		0		29		73		73
2009				0		7				50.773		10.018				0		70		70
2010						1						102.558						103		77

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit G13

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE / Paid Loss +1*
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		1.043		1.057		1.055		1.061		1.076		1.083		1.086		1.088		1.089		1.092		1.093		1.093		1.093		1.093		1.093		1.093		1.093		1.093		1.093		1.093		1.093		1.093
1990		1.011		1.046		1.063		1.060		1.077		1.081		1.090		1.100		1.110		1.117		1.117		1.117		1.117		1.117		1.117		1.117		1.117		1.117		1.117		1.117		1.117
1991		1.018		1.036		1.035		1.057		1.065		1.064		1.066		1.069		1.068		1.066		1.066		1.065		1.065		1.064		1.064		1.066		1.076		1.075		1.075		1.075
1992		1.009		1.039		1.053		1.086		1.098		1.101		1.101		1.101		1.101		1.101		1.093		1.093		1.093		1.093		1.092		1.092		1.092		1.092		1.092
1993		1.018		1.051		1.053		1.073		1.080		1.094		1.097		1.099		1.099		1.099		1.099		1.099		1.099		1.099		1.099		1.099		1.099		1.099
1994		1.027		1.071		1.114		1.160		1.174		1.157		1.157		1.155		1.154		1.155		1.155		1.155		1.155		1.155		1.155		1.155		1.155
1995		1.013		1.064		1.090		1.132		1.151		1.148		1.148		1.148		1.148		1.148		1.148		1.148		1.149		1.141		1.142		1.142
1996		1.012		1.048		1.067		1.094		1.115		1.132		1.132		1.133		1.133		1.133		1.133		1.133		1.133		1.133		1.133
1997		1.061		1.068		1.083		1.081		1.089		1.089		1.086		1.086		1.085		1.085		1.085		1.085		1.085		1.085
1998		1.012		1.012		1.018		1.028		1.033		1.039		1.042		1.043		1.044		1.045		1.044		1.044		1.046
1999		1.008		1.009		1.016		1.024		1.023		1.021		1.021		1.021		1.021		1.021		1.021		1.021
2000		1.000		1.005		1.006		1.006		1.005		1.006		1.007		1.007		1.007		1.007		1.007
2001		1.000		1.000		1.012		1.019		1.019		1.025		1.027		1.030		1.033		1.035
2002		1.012		1.011		1.013		1.010		1.012		1.013		1.013		1.016		1.017
2003		1.091		1.003		1.017		1.022		1.028		1.024		1.031		1.031
2004		1.000		1.014		1.016		1.013		1.013		1.015		1.015
2005		1.000		1.010		1.012		1.022		1.020		1.019
2006		1.000		1.009		1.010		1.011		1.010
2007		1.000		1.000		1.001		1.016
2008		1.000		1.008		1.024
2009		1.000		1.009
2010		1.024
*       Last Diagonal is as of 9/30/10.
	Paid ALAE / Paid Loss + 1 Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		1.013		0.998		1.005		1.015		1.007		1.003		1.001		1.001		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.034		1.016		0.997		1.016		1.004		1.008		1.009		1.010		1.006		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.018		1.000		1.021		1.008		0.999		1.002		1.002		0.999		0.998		1.000		0.999		1.000		0.999		1.000		1.002		1.009		1.000		1.000		1.000
1992		1.030		1.013		1.031		1.011		1.003		1.000		1.000		1.000		1.000		0.992		1.000		1.000		1.000		0.999		1.000		1.000		1.000		1.000
1993		1.032		1.003		1.019		1.007		1.013		1.003		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		1.043		1.040		1.041		1.012		0.986		0.999		0.999		0.999		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		1.050		1.024		1.039		1.017		0.997		1.000		1.000		1.000		1.000		1.000		1.000		1.001		0.993		1.001		1.000
1996		1.036		1.018		1.025		1.019		1.015		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.007		1.014		0.998		1.007		1.000		0.997		1.000		0.999		1.000		1.000		1.000		1.000		1.000
1998		0.999		1.007		1.010		1.005		1.006		1.003		1.001		1.001		1.001		0.999		1.000		1.003
1999		1.001		1.007		1.008		0.999		0.997		1.000		1.000		1.000		1.000		1.000		1.000
2000		1.005		1.001		0.999		1.000		1.001		1.001		1.000		1.000		1.000		1.000
2001		1.000		1.012		1.007		1.000		1.006		1.002		1.003		1.003		1.001
2002		0.999		1.002		0.997		1.002		1.001		1.000		1.003		1.001
2003		0.919		1.014		1.004		1.006		0.996		1.006		1.001
2004		1.014		1.002		0.998		1.000		1.001		1.001
2005		1.010		1.002		1.010		0.998		0.998
2006		1.009		1.000		1.001		1.000
2007		1.000		1.001		1.021
2008		1.008		1.021
2009		1.012
2010
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs		1.011		1.010		1.012		1.007		1.002		1.002		1.001		1.001		1.001		0.999		1.000		1.000		0.999		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Latest 5		1.008		1.005		1.007		1.001		1.001		1.002		1.001		1.001		1.000		1.000		1.000		1.001		0.999		1.000		1.000		1.002		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1		1.014		1.009		1.011		1.007		1.002		1.002		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1		1.009		1.002		1.005		1.001		1.000		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108-120		120-132		132-144		144-156		156-168		168-180		180 - 192		192 - 204		204-216		216-228		228-240		240-252		252-264		To Ult
Selected		1.014		1.009		1.011		1.003		1.002		1.002		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		1.043		1.029		1.020		1.009		1.006		1.004		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		1.062		1.033		1.022		1.012		1.007		1.005		1.003		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit G14

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	Paid ALAE /		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
	Ratio		Factors for		Ratio
Accident Year	@9/30/10		9/10-Ult		@9/30/10
1989		1.093		1.000		1.093
1990		1.117		1.000		1.117
1991		1.075		1.000		1.075
1992		1.092		1.000		1.092
1993		1.099		1.000		1.099
1994		1.155		1.000		1.155
1995		1.142		1.000		1.142
1996		1.133		1.000		1.133
1997		1.085		1.000		1.085
1998		1.046		1.000		1.046
1999		1.021		1.000		1.021
2000		1.007		1.000		1.007
2001		1.035		1.000		1.035
2002		1.017		1.001		1.018
2003		1.031		1.001		1.032
2004		1.015		1.003		1.019
2005		1.019		1.005		1.024
2006		1.010		1.007		1.017
2007		1.016		1.012		1.029
2008		1.024		1.022		1.047
2009		1.009		1.033		1.042
2010		1.024		1.062		1.087

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Direct Business
Exhibit G15

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

					Selected						Selected		Ultimate
			Paid ALAE to		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident	Paid ALAE		Paid Loss		Losses		Projection		Projection		ALAE*		Ultimate Loss
Year	($000s)		Ratio		($000s)		($000s)		($000s)		($000s)		Ratio
1989		102		0.093		1,096		102		102		102		0.093
1990		145		0.117		1,235		144		145		145		0.117
1991		82		0.075		1,090		82		82		82		0.075
1992		113		0.092		1,226		113		113		113		0.092
1993		149		0.099		1,504		149		149		149		0.099
1994		237		0.155		1,533		238		237		237		0.155
1995		232		0.142		1,637		232		232		232		0.142
1996		197		0.133		1,479		197		198		197		0.133
1997		148		0.085		1,745		148		149		148		0.085
1998		43		0.046		949		44		43		44		0.046
1999		23		0.021		1,112		23		23		23		0.021
2000		6		0.007		838		6		6		6		0.007
2001		64		0.035		1,902		67		66		67		0.035
2002		22		0.018		1,289		23		23		22		0.017
2003		52		0.032		1,661		53		55		52		0.031
2004		25		0.019		1,683		32		28		30		0.018
2005		36		0.024		2,163		52		43		48		0.022
2006		16		0.017		1,755		30		22		26		0.015
2007		24		0.029		2,201		64		43		54		0.025
2008		23		0.047		1,599		75		73		74		0.046
2009		7		0.042		2,427		102		70		86		0.035
2010		1		0.087		1,463		127		77		41		0.028
Total		1,747				33,587		2,103		1,979		1,978

* Selected Ultimate ALAE for the 2010 year reflects exposure as of 9/30/10 and is based on an ALAE to Loss Ratio of 2.8%, which is the weighted average ratio of 1999-2009.

Milliman

WSC Direct Business
Exhibit G16

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		102		102		0
1990		145		145		0
1991		82		82		0
1992		113		113		0
1993		149		149		0
1994		237		237		0
1995		232		232		0
1996		197		197		0
1997		148		148		0
1998		44		43		1
1999		23		23		0
2000		6		6		0
2001		67		64		3
2002		22		22		0
2003		52		52		0
2004		30		25		5
2005		48		36		12
2006		26		16		10
2007		54		24		30
2008		74		23		51
2009		86		7		79
2010		41		1		40
Total		1,978		1,747		231

Milliman

WSC Direct Business
Exhibit G17

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		1,198		1,198		1,198		0		0		0
1990		1,380		1,380		1,380		0		0		0
1991		1,172		1,172		1,172		0		0		0
1992		1,339		1,339		1,339		0		0		0
1993		1,653		1,653		1,653		0		0		0
1994		1,770		1,770		1,770		0		0		0
1995		1,869		1,869		1,869		0		0		0
1996		1,676		1,676		1,676		0		0		0
1997		1,893		1,893		1,893		0		0		0
1998		993		992		977		15		1		16
1999		1,135		1,135		1,135		0		0		0
2000		844		844		844		0		0		0
2001		1,969		1,966		1,916		50		3		53
2002		1,311		1,311		1,311		0		0		0
2003		1,713		1,713		1,713		0		0		0
2004		1,713		1,677		1,642		35		36		71
2005		2,211		2,130		1,978		152		81		233
2006		1,781		1,665		1,560		105		116		221
2007		2,255		1,991		1,491		500		264		764
2008		1,673		1,191		975		216		482		698
2009		2,513		1,496		817		679		1,017		1,696
2010		1,504		258		43		215		1,246		1,461
Total		35,565		32,319		30,352		1,967		3,246		5,213

Milliman

WSC Direct Business
Exhibit G18

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
GROSS OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		1,010		1,010		1,010		0		0		0
1990		1,238		1,238		1,238		0		0		0
1991		1,090		1,090		1,090		0		0		0
1992		1,226		1,226		1,226		0		0		0
1993		1,482		1,482		1,482		0		0		0
1994		1,523		1,523		1,523		0		0		0
1995		1,556		1,556		1,556		0		0		0
1996		1,252		1,252		1,252		0		0		0
1997		1,743		1,743		1,743		0		0		0
1998		949		949		934		15		0		15
1999		1,112		1,112		1,112		0		0		0
2000		838		838		838		0		0		0
2001		1,902		1,902		1,852		50		0		50
2002		1,289		1,289		1,289		0		0		0
2003		1,661		1,661		1,661		0		0		0
2004		1,683		1,652		1,617		35		31		66
2005		2,163		2,094		1,942		152		69		221
2006		1,755		1,649		1,544		105		106		211
2007		2,201		1,967		1,467		500		234		734
2008		1,599		1,168		952		216		431		647
2009		2,427		1,489		810		679		938		1,617
2010		1,463		257		42		215		1,206		1,421
Total		33,162		30,147		28,180		1,967		3,015		4,982

Milliman

WSC Direct Business
Exhibit G19

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		0		0		0		0		0		0
1990		0		0		0		0		0		0
1991		0		0		0		0		0		0
1992		0		0		0		0		0		0
1993		0		0		0		0		0		0
1994		0		0		0		0		0		0
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		0		0		0		0		0		0
1998		0		0		0		0		0		0
1999		0		0		0		0		0		0
2000		0		0		0		0		0		0
2001		0		0		0		0		0		0
2002		55		55		55		0		0		(0	)
2003		99		99		99		0		0		0
2004		102		100		98		2		2		4
2005		74		70		68		1		4		6
2006		1		0		0		0		1		1
2007		0		0		0		0		0		(0	)
2008		0		0		0		0		0		0
2009		0		0		0		0		0		0
2010		0		0		0		0		0		0
Total		331		324		320		4		7		11

Milliman

WSC Direct Business
Exhibit G20

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
NET OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		1,010		1,010		1,010		0		0		0
1990		1,238		1,238		1,238		0		0		0
1991		1,090		1,090		1,090		0		0		0
1992		1,226		1,226		1,226		0		0		0
1993		1,482		1,482		1,482		0		0		0
1994		1,523		1,523		1,523		0		0		0
1995		1,556		1,556		1,556		0		0		0
1996		1,252		1,252		1,252		0		0		0
1997		1,743		1,743		1,743		0		0		0
1998		949		949		934		15		0		15
1999		1,112		1,112		1,112		0		0		0
2000		838		838		838		0		0		0
2001		1,902		1,902		1,852		50		0		50
2002		1,234		1,234		1,234		0		0		0
2003		1,562		1,562		1,562		0		0		0
2004		1,581		1,552		1,519		33		29		62
2005		2,089		2,024		1,874		151		65		215
2006		1,754		1,649		1,544		105		105		210
2007		2,201		1,967		1,467		500		234		734
2008		1,599		1,168		952		216		431		647
2009		2,427		1,489		810		679		938		1,617
2010		1,463		257		42		215		1,206		1,421
Total		32,831		29,823		27,860		1,964		3,008		4,971

Milliman

WSC Direct Business
Exhibit G21

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
GROSS OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		101		101		0
1990		146		146		0
1991		82		82		0
1992		113		113		0
1993		149		149		0
1994		237		237		0
1995		216		216		0
1996		190		190		0
1997		148		148		0
1998		44		43		1
1999		23		23		0
2000		6		6		0
2001		67		64		3
2002		22		22		0
2003		52		52		0
2004		30		25		5
2005		48		36		12
2006		26		16		10
2007		54		24		30
2008		74		23		51
2009		86		7		79
2010		41		1		40
Total		1,955		1,724		231

Milliman

WSC Direct Business
Exhibit G22

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		0		0		0
1990		0		0		0
1991		0		0		0
1992		0		0		0
1993		0		0		0
1994		0		0		0
1995		0		0		0
1996		0		0		0
1997		0		0		0
1998		0		0		0
1999		0		0		0
2000		0		0		0
2001		0		0		0
2002		1		1		0
2003		3		3		0
2004		1		1		0
2005		1		0		1
2006		0		0		0
2007		0		0		0
2008		0		0		0
2009		0		0		0
2010		0		0		0
Total		6		5		1

Milliman

WSC Direct Business
Exhibit G23

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
NET OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		101		101		0
1990		146		146		0
1991		82		82		0
1992		113		113		0
1993		149		149		0
1994		237		237		0
1995		216		216		0
1996		190		190		0
1997		148		148		0
1998		44		43		1
1999		23		23		0
2000		6		6		0
2001		67		64		3
2002		21		21		0
2003		49		49		0
2004		29		24		5
2005		47		36		11
2006		26		16		10
2007		54		24		30
2008		74		23		51
2009		86		7		79
2010		41		1		40
Total		1,949		1,719		230

Milliman

WSC Direct Business
Exhibit G24

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
GROSS OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		1,111		1,111		1,111		0		0		0
1990		1,384		1,384		1,384		0		0		0
1991		1,172		1,172		1,172		0		0		0
1992		1,339		1,339		1,339		0		0		0
1993		1,631		1,631		1,631		0		0		0
1994		1,760		1,760		1,760		0		0		0
1995		1,772		1,772		1,772		0		0		0
1996		1,442		1,442		1,442		0		0		0
1997		1,891		1,891		1,891		0		0		0
1998		993		992		977		15		1		16
1999		1,135		1,135		1,135		0		0		0
2000		844		844		844		0		0		0
2001		1,969		1,966		1,916		50		3		53
2002		1,311		1,311		1,311		0		0		0
2003		1,713		1,713		1,713		0		0		0
2004		1,713		1,677		1,642		35		36		71
2005		2,211		2,130		1,978		152		81		233
2006		1,781		1,665		1,560		105		116		221
2007		2,255		1,991		1,491		500		264		764
2008		1,673		1,191		975		216		482		698
2009		2,513		1,496		817		679		1,017		1,696
2010		1,504		258		43		215		1,246		1,461
Total		35,117		31,871		29,904		1,967		3,246		5,213

Milliman

WSC Direct Business
Exhibit G25

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

												Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR			& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10			@9/30/10
1989		0		0		0		0		0			0
1990		0		0		0		0		0			0
1991		0		0		0		0		0			0
1992		0		0		0		0		0			0
1993		0		0		0		0		0			0
1994		0		0		0		0		0			0
1995		0		0		0		0		0			0
1996		0		0		0		0		0			0
1997		0		0		0		0		0			0
1998		0		0		0		0		0			0
1999		0		0		0		0		0			0
2000		0		0		0		0		0			0
2001		0		0		0		0		0			0
2002		56		56		56		0		(0	)		(0	)
2003		102		102		102		0		0			0
2004		103		101		99		2		2			4
2005		75		70		68		1		5			7
2006		1		0		0		0		1			1
2007		0		0		0		0		(0	)		(0	)
2008		0		0		0		0		0			0
2009		0		0		0		0		0			0
2010		0		0		0		0		0			0
Total		337		329		326		4		8			11

Milliman

WSC Direct Business
Exhibit G26

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
NET OF QUOTA SHARE TREATIES
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		1,111		1,111		1,111		0		0		0
1990		1,384		1,384		1,384		0		0		0
1991		1,172		1,172		1,172		0		0		0
1992		1,339		1,339		1,339		0		0		0
1993		1,631		1,631		1,631		0		0		0
1994		1,760		1,760		1,760		0		0		0
1995		1,772		1,772		1,772		0		0		0
1996		1,442		1,442		1,442		0		0		0
1997		1,891		1,891		1,891		0		0		0
1998		993		992		977		15		1		16
1999		1,135		1,135		1,135		0		0		0
2000		844		844		844		0		0		0
2001		1,969		1,966		1,916		50		3		53
2002		1,255		1,255		1,255		0		0		0
2003		1,611		1,611		1,611		0		0		0
2004		1,610		1,576		1,543		33		34		67
2005		2,136		2,060		1,910		151		76		226
2006		1,780		1,665		1,560		105		115		220
2007		2,255		1,991		1,491		500		264		764
2008		1,673		1,191		975		216		482		698
2009		2,513		1,496		817		679		1,017		1,696
2010		1,504		258		43		215		1,246		1,461
Total		34,780		31,542		29,578		1,964		3,238		5,201

Milliman

WSC Direct Business
Exhibit H1

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Loss Salvage & Subrogation Recovered* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		3		32		51		79		100		109		127		158		177		182		188		200		204		204		204		206		206		206		206		206		206		206
1990		1		12		43		68		103		129		145		150		162		165		168		170		171		173		173		173		173		174		174		175		176
1991		6		22		59		97		138		172		211		223		232		246		249		253		256		259		259		259		259		259		259		259
1992		1		15		33		67		101		164		218		257		265		274		274		275		279		280		283		283		284		287		288
1993		1		17		90		114		144		170		199		208		219		233		242		249		258		259		261		262		262		262
1994		1		73		101		124		163		211		221		254		256		258		271		278		282		282		282		282		282
1995		2		16		68		144		213		241		270		277		291		302		310		317		320		326		334		339
1996		2		48		89		158		224		250		260		269		279		290		298		307		315		320		326
1997		6		30		44		88		154		165		174		181		203		211		215		220		222		223
1998		5		10		105		136		161		183		198		202		203		205		206		207		210
1999		2		15		30		38		48		55		66		84		92		100		111		117
2000		0		2		11		20		38		53		83		89		90		91		93
2001		1		18		30		45		71		95		148		185		211		220
2002		8		34		49		73		86		93		100		129		139
2003		0		6		80		85		108		114		121		131
2004		0		2		13		23		63		81		101
2005		0		16		54		75		102		122
2006		1		43		89		117		128
2007		0		27		58		70
2008		1		30		49
2009		0		5
2010		0
*      Last diagonal is as of 9/30/10.
Accident	Salvage & Subrogation Recovered Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989		10.667		1.594		1.549		1.266		1.090		1.165		1.244		1.120		1.028		1.033		1.064		1.020		1.000		1.000		1.010		1.000		1.000		1.000		1.000		1.000		1.000
1990		12.000		3.583		1.581		1.515		1.252		1.124		1.034		1.080		1.019		1.018		1.012		1.006		1.012		1.000		1.000		1.000		1.006		1.000		1.006		1.008
1991		3.667		2.682		1.644		1.423		1.246		1.227		1.057		1.040		1.060		1.012		1.016		1.012		1.012		1.000		1.000		1.000		1.000		1.000		1.000
1992		15.000		2.200		2.030		1.507		1.624		1.329		1.179		1.031		1.034		1.000		1.004		1.015		1.004		1.011		1.000		1.004		1.011		1.005
1993		17.000		5.294		1.267		1.263		1.181		1.171		1.045		1.053		1.064		1.039		1.029		1.036		1.004		1.008		1.004		1.000		1.000
1994		73.000		1.384		1.228		1.315		1.294		1.047		1.149		1.008		1.008		1.050		1.026		1.014		1.000		1.000		1.000		1.000
1995		8.000		4.250		2.118		1.479		1.131		1.120		1.026		1.051		1.038		1.026		1.023		1.009		1.019		1.025		1.020
1996		24.000		1.854		1.775		1.418		1.116		1.040		1.035		1.037		1.039		1.028		1.030		1.026		1.016		1.025
1997		5.000		1.467		2.000		1.750		1.071		1.055		1.040		1.122		1.039		1.019		1.023		1.009		1.006
1998		2.000		10.500		1.295		1.184		1.137		1.082		1.020		1.005		1.010		1.005		1.005		1.019
1999		7.500		2.000		1.267		1.263		1.146		1.200		1.273		1.095		1.087		1.110		1.073
2000				5.500		1.818		1.900		1.395		1.566		1.072		1.011		1.011		1.029
2001		18.000		1.667		1.500		1.578		1.338		1.558		1.250		1.141		1.057
2002		4.250		1.441		1.490		1.178		1.081		1.075		1.290		1.105
2003				13.333		1.063		1.271		1.056		1.061		1.112
2004				6.500		1.769		2.739		1.286		1.342
2005				3.375		1.389		1.360		1.270
2006		43.000		2.070		1.315		1.127
2007				2.148		1.285
2008		30.000		1.923
2009
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		18.206		3.738		1.546		1.474		1.218		1.198		1.122		1.064		1.038		1.031		1.028		1.017		1.008		1.009		1.005		1.001		1.003		1.001		1.002		1.004		1.000
Average x H/L		15.237		3.336		1.541		1.417		1.202		1.183		1.117		1.063		1.036		1.026		1.025		1.016		1.008		1.007		1.003		1.000		1.002		1.000		1.000
Col Sum		11.415		2.467		1.482		1.385		1.197		1.160		1.102		1.059		1.037		1.027		1.025		1.017		1.008		1.010		1.005		1.001		1.003		1.001		1.002		1.004		1.000
Selected		11.415		2.467		1.482		1.385		1.197		1.160		1.102		1.059		1.037		1.027		1.025		1.016		1.008		1.007		1.003		1.002		1.002		1.001		1.001		1.001		1.001
	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		106.559		9.335		3.784		2.553		1.843		1.540		1.328		1.205		1.138		1.097		1.068		1.042		1.026		1.018		1.011		1.008		1.006		1.004		1.003		1.002		1.001		1.000
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		197.046		17.159		4.742		2.817		1.999		1.611		1.378		1.235		1.154		1.107		1.075		1.048		1.030		1.020		1.013		1.009		1.007		1.005		1.003		1.002		1.001		1.000

Milliman

WSC Direct Business
Exhibit H2

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
EVALUATED AS OF SEPTEMBER 30, 2010

Loss Salvage & Subrogation Recovered Development Projection Method ($000s)

	(1)		(2)		(3)
					[(1)*(2)]
					Projected
					Ultimate
			Cumulative		Loss
	Sal/Sub		Development		Sal/Sub
Accident	Recovered		Factors		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10
1989		206		1.000		206
1990		176		1.001		176
1991		259		1.002		260
1992		288		1.003		289
1993		262		1.005		263
1994		282		1.007		284
1995		339		1.009		342
1996		326		1.013		330
1997		223		1.020		227
1998		210		1.030		216
1999		117		1.048		123
2000		93		1.075		100
2001		220		1.107		244
2002		139		1.154		160
2003		131		1.235		162
2004		101		1.378		139
2005		122		1.611		197
2006		128		1.999		256
2007		70		2.817		197
2008		49		4.742		232
2009		5		17.159		86
2010		0		197.046		0
Total		3,746				4,489

Note: The 9-Ult Cumulative Development Factor was interpolated using curve fitting methods. The Projected Ultimate Sal/Sub for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit H3

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Paid Loss* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		93		562		964		1,022		1,036		1,045		1,057		1,083		1,095		1,095		1,095		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096		1,096
1990		89		413		843		1,121		1,166		1,203		1,215		1,225		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235		1,235
1991		112		502		734		858		873		918		965		961		1,017		1,042		1,042		1,060		1,060		1,070		1,070		1,070		1,070		1,090		1,090		1,090
1992		109		460		810		931		964		1,083		1,111		1,116		1,116		1,116		1,216		1,216		1,216		1,216		1,226		1,226		1,226		1,226		1,226
1993		109		612		1,013		1,246		1,396		1,439		1,443		1,503		1,503		1,503		1,504		1,504		1,504		1,504		1,504		1,504		1,504		1,504
1994		75		522		942		1,133		1,261		1,430		1,481		1,523		1,533		1,533		1,533		1,533		1,533		1,533		1,533		1,533		1,533
1995		150		667		1,044		1,234		1,279		1,426		1,537		1,537		1,537		1,537		1,537		1,537		1,537		1,637		1,637		1,637
1996		427		888		1,243		1,418		1,477		1,477		1,477		1,479		1,479		1,479		1,479		1,479		1,479		1,479		1,479
1997		82		497		962		1,466		1,573		1,665		1,722		1,728		1,745		1,745		1,745		1,745		1,745		1,745
1998		82		515		709		820		824		882		902		907		907		907		932		932		934
1999		124		544		679		872		984		1,111		1,111		1,112		1,112		1,112		1,112		1,112
2000		71		369		646		710		740		810		837		837		838		838		838
2001		77		1,130		1,376		1,655		1,753		1,824		1,827		1,827		1,852		1,852
2002		173		740		933		1,209		1,246		1,252		1,289		1,289		1,289
2003		66		668		981		1,152		1,349		1,659		1,661		1,661
2004		92		629		1,196		1,411		1,566		1,568		1,617
2005		478		910		1,417		1,614		1,812		1,942
2006		269		965		1,236		1,519		1,544
2007		88		588		1,072		1,467
2008		236		623		952
2009		508		810
2010		42

* Last diagonal is as of 9/30/10.

Milliman

WSC Direct Business
Exhibit H4

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
EVALUATED AS OF SEPTEMBER 30, 2010

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Loss*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0.032		0.057		0.053		0.077		0.097		0.104		0.120		0.146		0.162		0.166		0.172		0.182		0.186		0.186		0.186		0.188		0.188		0.188		0.188		0.188		0.188		0.188
1990		0.011		0.029		0.051		0.061		0.088		0.107		0.119		0.122		0.131		0.134		0.136		0.138		0.138		0.140		0.140		0.140		0.140		0.141		0.141		0.142		0.143
1991		0.054		0.044		0.080		0.113		0.158		0.187		0.219		0.232		0.228		0.236		0.239		0.239		0.242		0.242		0.242		0.242		0.242		0.238		0.238		0.238
1992		0.009		0.033		0.041		0.072		0.105		0.151		0.196		0.230		0.237		0.246		0.225		0.226		0.229		0.230		0.231		0.231		0.232		0.234		0.235
1993		0.009		0.028		0.089		0.091		0.103		0.118		0.138		0.138		0.146		0.155		0.161		0.166		0.172		0.172		0.174		0.174		0.174		0.174
1994		0.013		0.140		0.107		0.109		0.129		0.148		0.149		0.167		0.167		0.168		0.177		0.181		0.184		0.184		0.184		0.184		0.184
1995		0.013		0.024		0.065		0.117		0.167		0.169		0.176		0.180		0.189		0.196		0.202		0.206		0.208		0.199		0.204		0.207
1996		0.005		0.054		0.072		0.111		0.152		0.169		0.176		0.182		0.189		0.196		0.201		0.208		0.213		0.216		0.220
1997		0.073		0.060		0.046		0.060		0.098		0.099		0.101		0.105		0.116		0.121		0.123		0.126		0.127		0.128
1998		0.061		0.019		0.148		0.166		0.195		0.207		0.220		0.223		0.224		0.226		0.221		0.222		0.225
1999		0.016		0.028		0.044		0.044		0.049		0.050		0.059		0.076		0.083		0.090		0.100		0.105
2000		0.000		0.005		0.017		0.028		0.051		0.065		0.099		0.106		0.107		0.109		0.111
2001		0.013		0.016		0.022		0.027		0.041		0.052		0.081		0.101		0.114		0.119
2002		0.046		0.046		0.053		0.060		0.069		0.074		0.078		0.100		0.108
2003		0.000		0.009		0.082		0.074		0.080		0.069		0.073		0.079
2004		0.000		0.003		0.011		0.016		0.040		0.052		0.062
2005		0.000		0.018		0.038		0.046		0.056		0.063
2006		0.004		0.045		0.072		0.077		0.083
2007		0.000		0.046		0.054		0.048
2008		0.004		0.048		0.051
2009		0.000		0.006
2010		0.000
*      Last diagonal is as of 9/30/10.
Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264
1989		1.765		0.929		1.461		1.249		1.081		1.152		1.214		1.108		1.028		1.033		1.063		1.020		1.000		1.000		1.010		1.000		1.000		1.000		1.000		1.000		1.000
1990		2.586		1.756		1.189		1.456		1.214		1.113		1.026		1.071		1.019		1.018		1.012		1.006		1.012		1.000		1.000		1.000		1.006		1.000		1.006		1.008
1991		0.818		1.834		1.406		1.398		1.185		1.167		1.061		0.983		1.035		1.012		0.999		1.012		1.002		1.000		1.000		1.000		0.982		1.000		1.000
1992		3.554		1.249		1.766		1.456		1.445		1.296		1.174		1.031		1.034		0.918		1.004		1.015		1.004		1.002		1.000		1.004		1.011		1.005
1993		3.028		3.198		1.030		1.127		1.145		1.167		1.004		1.053		1.064		1.038		1.029		1.036		1.004		1.008		1.004		1.000		1.000
1994		10.489		0.767		1.021		1.181		1.141		1.011		1.118		1.001		1.008		1.050		1.026		1.014		1.000		1.000		1.000		1.000
1995		1.799		2.715		1.792		1.427		1.015		1.039		1.026		1.051		1.038		1.026		1.023		1.009		0.957		1.025		1.020
1996		11.541		1.325		1.556		1.361		1.116		1.040		1.033		1.037		1.039		1.028		1.030		1.026		1.016		1.025
1997		0.825		0.758		1.312		1.631		1.012		1.020		1.037		1.111		1.039		1.019		1.023		1.009		1.006
1998		0.318		7.627		1.120		1.178		1.062		1.058		1.015		1.005		1.010		0.978		1.005		1.016
1999		1.710		1.602		0.986		1.119		1.015		1.200		1.272		1.095		1.087		1.110		1.073
2000				3.142		1.654		1.823		1.274		1.516		1.072		1.010		1.011		1.029
2001		1.227		1.369		1.247		1.490		1.286		1.555		1.250		1.125		1.057
2002		0.994		1.143		1.150		1.143		1.076		1.044		1.290		1.105
2003				9.079		0.905		1.085		0.858		1.060		1.112
2004				3.418		1.500		2.468		1.284		1.288
2005				2.167		1.219		1.211		1.158
2006		11.987		1.616		1.070		1.103
2007				1.178		0.846
2008		11.364		1.093
2009
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		4.267		2.398		1.275		1.384		1.139		1.170		1.113		1.056		1.036		1.022		1.026		1.016		1.000		1.007		1.005		1.001		1.000		1.001		1.002		1.004		1.000
Average x H/L		3.977		2.118		1.270		1.335		1.138		1.154		1.108		1.056		1.034		1.023		1.024		1.015		1.004		1.006		1.003		1.000		1.002		1.000		1.000
Avg L5 x H/L		N/A		1.654		1.065		1.152		1.173		1.288		1.211		1.070		1.036		1.025		1.025		1.013		1.003		1.012		1.001		1.000		1.002
Selected		3.977		2.118		1.270		1.335		1.138		1.154		1.211		1.070		1.036		1.025		1.025		1.015		1.004		1.006		1.003		1.002		1.001		1.001		1.001		1.001		1.000
	12 - Ult		24 - Ult		36 - Ult		48 - Ult		60 - Ult		72 - Ult		84 - Ult		96 - Ult		108 - Ult		120 - Ult		132 - Ult		144 - Ult		156 - Ult		168 - Ult		180 - Ult		192 - Ult		204 - Ult		216 - Ult		228 - Ult		240 - Ult		252 - Ult		264 - Ult
Dec Cumulatives		27.366		6.881		3.249		2.558		1.916		1.684		1.459		1.205		1.126		1.087		1.060		1.034		1.019		1.015		1.009		1.006		1.004		1.003		1.002		1.001		1.000		1.000
	9 - Ult		21 - Ult		33 - Ult		45 - Ult		57 - Ult		69 - Ult		81 - Ult		93 - Ult		105 - Ult		117 - Ult		129 - Ult		141 - Ult		153 - Ult		165 - Ult		177 - Ult		189 - Ult		201 - Ult		213 - Ult		225 - Ult		237 - Ult		249 - Ult		261 - Ult
Sep Cumulatives		N/A		9.717		3.920		2.716		2.060		1.739		1.512		1.264		1.145		1.097		1.067		1.040		1.023		1.016		1.011		1.007		1.005		1.003		1.002		1.001		1.000		1.000

Milliman

WSC Direct Business
Exhibit H5

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
EVALUATED AS OF SEPTEMBER 30, 2010

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Loss ($000s)

	(1)		(2)		(3)		(4)		(5)
									[(3) * (4)]
									Projected
			Cumulative		[(1)*(2)]				Ultimate
			Ratio		Projected		Gross		Loss
			Development		Ultimate		Ultimate		Sal/Sub
Accident	Ratio		Factors		Ratio		Loss		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1989		0.188		1.000		0.188		1,096		206
1990		0.143		1.000		0.143		1,235		177
1991		0.238		1.001		0.238		1,090		259
1992		0.235		1.002		0.235		1,226		288
1993		0.174		1.003		0.175		1,504		263
1994		0.184		1.005		0.185		1,533		284
1995		0.207		1.007		0.209		1,637		342
1996		0.220		1.011		0.223		1,479		330
1997		0.128		1.016		0.130		1,745		227
1998		0.225		1.023		0.230		949		218
1999		0.105		1.040		0.109		1,112		121
2000		0.111		1.067		0.118		838		99
2001		0.119		1.097		0.130		1,902		247
2002		0.108		1.145		0.123		1,289		159
2003		0.079		1.264		0.100		1,661		166
2004		0.062		1.512		0.094		1,683		158
2005		0.063		1.739		0.109		2,163		236
2006		0.083		2.060		0.171		1,755		300
2007		0.048		2.716		0.130		2,201		286
2008		0.051		3.920		0.202		1,599		323
2009		0.006		9.717		0.060		2,427		146
2010		0.000		N/A		N/A		1,463		N/A
Total								33,587		4,835

Milliman

WSC Direct Business
Exhibit H6

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
EVALUATED AS OF SEPTEMBER 30, 2010

Selection of Ultimate Loss Salvage & Subrogation ($000s)

			Ultimate		Ultimate
			Sal/Sub		Sal/Sub				Selected
	Gross		Indicated by		Indicated by				Ultimate
	Ultimate		Dollar		Ratio		Selected		Sal/Sub
Accident	Loss		Development		Development		Ultimate		to Ultimate
Year	@9/30/10		Method		Method		Sal/Sub		Loss Ratio
1989		1,096		206		206		206		0.188
1990		1,235		176		177		176		0.143
1991		1,090		260		259		259		0.238
1992		1,226		289		288		288		0.235
1993		1,504		263		263		262		0.174
1994		1,533		284		284		282		0.184
1995		1,637		342		342		339		0.207
1996		1,479		330		330		326		0.220
1997		1,745		227		227		223		0.128
1998		949		216		218		210		0.221
1999		1,112		123		121		117		0.105
2000		838		100		99		93		0.111
2001		1,902		244		247		220		0.116
2002		1,289		160		159		139		0.108
2003		1,661		162		166		131		0.079
2004		1,683		139		158		139		0.083
2005		2,163		197		236		197		0.091
2006		1,755		256		300		256		0.146
2007		2,201		197		286		242		0.110
2008		1,599		232		323		163		0.102
2009		2,427		86		146		248		0.102
2010		1,463		0		N/A		149		0.102
Total		33,587		4,489		4,835		4,665		0.139

Note: Ultimate Sal/Sub for 2008-2010 are based on an Ultimate Sal/Sub Ratio of 10.2%, which is the weighted average of 2002-2006.

Milliman

WSC Direct Business
Exhibit H7

WESTERN SURETY COMPANY — DIRECT BUSINESS
GROSS FIDELITY
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		206		206		0
1990		176		176		0
1991		259		259		0
1992		288		288		0
1993		262		262		0
1994		282		282		0
1995		339		339		0
1996		326		326		0
1997		223		223		0
1998		210		210		0
1999		117		117		0
2000		93		93		0
2001		220		220		0
2002		139		139		0
2003		131		131		0
2004		139		101		38
2005		197		122		75
2006		256		128		128
2007		242		70		172
2008		163		49		114
2009		248		5		243
2010		149		0		149
Total		4,665		3,746		919

Milliman

WSC Direct Business
Exhibit H8

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
GROSS OF THE QUOTA SHARE TREATIES
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		203		203		0
1990		176		176		0
1991		259		259		0
1992		288		288		0
1993		253		253		0
1994		278		278		0
1995		334		334		0
1996		327		327		0
1997		222		222		0
1998		211		211		0
1999		117		117		0
2000		93		93		0
2001		220		220		0
2002		139		139		0
2003		131		131		0
2004		139		101		38
2005		197		122		75
2006		256		128		128
2007		242		70		172
2008		163		49		114
2009		248		5		243
2010		149		0		149
Total		4,645		3,726		919

Milliman

WSC Direct Business
Exhibit H9

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
QUOTA SHARE TREATIES
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		0		0		0
1990		0		0		0
1991		0		0		0
1992		0		0		0
1993		0		0		0
1994		0		0		0
1995		0		0		0
1996		0		0		0
1997		0		0		0
1998		0		0		0
1999		0		0		0
2000		0		0		0
2001		0		0		0
2002		5		5		0
2003		8		8		0
2004		8		6		2
2005		10		5		5
2006		1		0		1
2007		0		0		0
2008		0		0		0
2009		0		0		0
2010		0		0		0
Total		32		24		8

Milliman

WSC Direct
Business Exhibit H10

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET FIDELITY
NET OF THE QUOTA SHARE TREATIES
EVALUATED AS OF SEPTEMBER 30, 2010

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Sal/Sub		Indicated
Accident	Ultimate		Recovered		Sal/Sub
Year	Sal/Sub		@9/30/10		Recoverable
1989		203		203		0
1990		176		176		0
1991		259		259		0
1992		288		288		0
1993		253		253		0
1994		278		278		0
1995		334		334		0
1996		327		327		0
1997		222		222		0
1998		211		211		0
1999		117		117		0
2000		93		93		0
2001		220		220		0
2002		134		134		0
2003		123		123		0
2004		131		95		36
2005		187		117		70
2006		255		128		127
2007		242		70		172
2008		163		49		114
2009		248		5		243
2010		149		0		149
Total		4,613		3,702		911

Milliman

WSC Direct Business
Exhibit I1

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid Losses*
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		0		25,100		67,600		86,600		86,600		96,600		101,600		101,600		101,600		101,600		101,600		101,600		116,570		116,570		116,570		116,570		116,570		116,570		116,570		116,570		116,570		116,570
1990		0		0		89,100		93,100		102,495		116,204		125,704		152,204		177,204		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175
1991		2,500		2,500		2,709		16,209		16,209		16,209		16,209		21,414		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914
1992		0		12,550		52,550		66,491		81,491		84,491		84,491		112,491		112,491		112,491		112,491		112,491		112,491		112,491		112,491		112,491		112,491		112,491		112,491
1993		0		2,755		32,155		32,155		37,155		37,155		57,155		57,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404
1994		2,500		34,000		37,500		71,740		78,915		78,915		78,915		83,915		83,915		83,915		83,915		83,915		83,915		83,915		83,915		83,915		83,915
1995		0		14,100		66,025		135,253		162,953		218,786		228,781		228,781		228,781		218,269		265,558		309,295		309,295		309,295		309,295		309,295
1996		0		21,235		58,346		99,721		109,721		120,621		120,621		126,621		132,621		132,621		132,621		132,621		132,621		132,621		132,621
1997		0		27,100		102,600		119,100		129,100		130,000		130,000		130,000		130,000		130,000		130,000		130,000		130,000		130,000
1998		0		13,100		27,075		53,075		61,075		78,436		88,575		100,908		100,908		100,908		100,908		100,908		100,908
1999		11,750		17,750		39,000		76,500		76,500		86,500		86,500		86,500		96,500		106,500		106,500		106,500
2000		5,200		13,200		56,700		74,200		106,926		136,926		137,926		137,926		137,926		137,926		137,926
2001		0		22,015		65,428		115,612		125,612		141,300		161,800		173,300		183,300		183,300
2002		25,150		76,926		99,918		102,918		107,918		132,918		132,918		142,918		142,918
2003		7,000		29,000		61,500		110,000		110,000		120,000		139,412		141,912
2004		15,000		51,755		78,767		116,184		141,184		155,184		154,792
2005		300		18,322		29,795		90,295		121,453		135,953
2006		775		32,125		85,625		98,125		119,625
2007		0		69,413		137,413		157,413
2008		42,448		45,948		71,948
2009		5,000		12,910
2010		0

* Last Diagonal is as of 9/30/10.

	Paid Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989				2.693		1.281		1.000		1.115		1.052		1.000		1.000		1.000		1.000		1.000		1.147		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990						1.045		1.101		1.134		1.082		1.211		1.164		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.000		1.084		5.983		1.000		1.000		1.000		1.321		1.023		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992				4.187		1.265		1.226		1.037		1.000		1.331		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993				11.672		1.000		1.155		1.000		1.538		1.004		1.174		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		13.600		1.103		1.913		1.100		1.000		1.000		1.063		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995				4.683		2.049		1.205		1.343		1.046		1.000		1.000		0.954		1.217		1.165		1.000		1.000		1.000		1.000
1996				2.748		1.709		1.100		1.099		1.000		1.050		1.047		1.000		1.000		1.000		1.000		1.000		1.000
1997				3.786		1.161		1.084		1.007		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998				2.067		1.960		1.151		1.284		1.129		1.139		1.000		1.000		1.000		1.000		1.000
1999		1.511		2.197		1.962		1.000		1.131		1.000		1.000		1.116		1.104		1.000		1.000
2000		2.538		4.295		1.309		1.441		1.281		1.007		1.000		1.000		1.000		1.000
2001				2.972		1.767		1.086		1.125		1.145		1.071		1.058		1.000
2002		3.059		1.299		1.030		1.049		1.232		1.000		1.075		1.000
2003		4.143		2.121		1.789		1.000		1.091		1.162		1.024
2004		3.450		1.522		1.475		1.215		1.099		0.997
2005		61.073		1.626		3.031		1.345		1.162
2006		41.452		2.665		1.146		1.302
2007				1.980		1.199
2008		1.082		1.818
2009		3.542
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	12.405	2.975	1.793	1.142	1.126	1.072	1.086	1.042	1.004	1.018	1.015	1.015	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	26.787	1.922	1.728	1.182	1.142	1.062	1.034	1.035	1.021	1.000	1.033	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	8.264	2.574	1.593	1.132	1.120	1.044	1.074	1.034	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	22.497	1.808	1.487	1.189	1.129	1.051	1.032	1.019	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	2.884	2.239	1.447	1.145	1.143	1.054	1.064	1.037	1.000	1.034	1.034	1.012	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	2.352	1.908	1.474	1.175	1.139	1.059	1.038	1.031	1.015	1.000	1.059	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 3	1.342	2.079	1.397	1.282	1.117	1.046	1.057	1.022	1.024	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected		8.264		2.239		1.474		1.175		1.139		1.059		1.064		1.037		1.015		1.010		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		44.163		5.344		2.387		1.620		1.378		1.210		1.143		1.074		1.036		1.021		1.011		1.006		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		84.702		9.061		2.920		1.785		1.435		1.250		1.159		1.091		1.045		1.025		1.014		1.007		1.004		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit I2

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

							Cumulative Paid Loss						Indicated Ultimate						Indicated
	Paid Losses						Development Factors						Paid Losses						Ultimate
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1989		116,570		116,570		116,570		1.000		1.000		1.000		116,570		116,570		116,570		116,570
1990		177,175		177,175		177,175		1.000		1.000		1.000		177,175		177,175		177,175		177,175
1991		21,914		21,914		21,914		1.000		1.000		1.000		21,914		21,914		21,914		21,914
1992		112,491		112,491		112,491		1.000		1.000		1.000		112,491		112,491		112,491		112,491
1993		67,404		67,404		67,404		1.000		1.000		1.000		67,404		67,404		67,404		67,404
1994		83,915		83,915		83,915		1.000		1.000		1.000		83,915		83,915		83,915		83,915
1995		309,295		309,295		309,295		1.001		1.000		1.000		309,604		309,295		309,295		309,295
1996		132,621		132,621		132,621		1.003		1.001		1.000		133,019		132,754		132,621		132,621
1997		130,000		130,000		130,000		1.006		1.003		1.002		130,780		130,390		130,260		130,260
1998		100,908		100,908		100,908		1.011		1.006		1.004		102,018		101,513		101,312		101,312
1999		106,500		106,500		106,500		1.021		1.011		1.007		108,737		107,672		107,246		107,246
2000		137,926		137,926		137,926		1.036		1.021		1.014		142,891		140,822		139,857		139,857
2001		173,300		183,300		183,300		1.074		1.036		1.025		186,124		189,899		187,883		187,883
2002		132,918		142,918		142,918		1.143		1.074		1.045		151,925		153,494		149,349		149,349
2003		120,000		139,412		141,912		1.210		1.143		1.091		145,200		159,348		154,826		154,826
2004		141,184		155,184		154,792		1.378		1.210		1.159		194,552		187,773		179,404		179,404
2005		90,295		121,453		135,953		1.620		1.378		1.250		146,278		167,362		169,941		169,941
2006		85,625		98,125		119,625		2.387		1.620		1.435		204,387		158,963		171,662		171,662
2007		69,413		137,413		157,413		5.344		2.387		1.785		370,943		328,005		280,982		280,982
2008		42,448		45,948		71,948		44.163		5.344		2.920		1,874,631		245,546		210,088		210,088
2009				5,000		12,910				44.163		9.061				220,815		116,978		116,978
2010						0						84.702						0		0

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit I3

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Incurred Losses*
Accident Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		30,000		46,600		73,343		98,600		109,600		109,600		126,600		101,600		101,600		101,600		101,600		101,600		116,570		116,570		116,570		116,570		116,570		116,570		116,570		116,570		116,570		116,570
1990		55,000		95,000		99,000		103,100		126,995		275,704		325,704		177,204		177,204		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175		177,175
1991		3,008		2,500		25,009		26,209		26,209		71,140		19,279		46,414		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914		21,914
1992		13,500		52,481		77,550		131,491		169,119		163,119		162,119		137,491		137,491		137,491		112,491		112,491		112,491		112,492		114,492		112,491		112,491		112,491		112,491
1993		0		11,307		53,900		69,500		40,155		87,155		59,973		67,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404		67,404
1994		10,250		48,829		136,982		143,744		158,915		118,915		84,752		84,752		83,915		83,915		83,915		83,915		83,916		83,915		83,915		83,915		83,915
1995		3,500		74,889		125,303		237,371		319,203		275,036		278,781		278,781		278,782		268,270		290,558		309,297		319,296		319,296		309,295		309,295
1996		49,800		58,999		99,356		99,721		109,721		120,621		120,624		126,624		132,621		132,621		132,621		132,621		132,621		132,621		132,621
1997		16,570		65,100		118,125		129,100		129,100		130,000		130,003		130,002		130,000		130,000		130,000		130,000		130,000		130,000
1998		16,100		23,100		57,075		68,075		76,078		83,439		88,578		100,910		100,908		100,908		100,908		100,908		100,908
1999		26,750		46,783		90,043		86,505		81,506		86,506		86,500		86,502		96,502		106,500		106,500		106,500
2000		16,200		39,201		56,705		74,210		116,931		136,933		137,933		137,929		137,929		137,926		137,927
2001		15,003		37,025		75,440		115,622		125,627		151,313		161,810		173,307		183,304		183,301
2002		25,168		76,947		99,925		102,926		115,425		140,421		140,424		142,921		142,922
2003		7,010		39,020		65,012		110,010		130,006		145,006		144,416		141,915
2004		25,011		61,768		94,783		116,203		141,204		175,192		167,302
2005		310		30,841		47,317		102,825		136,474		150,975
2006		783		32,142		85,647		108,142		129,647
2007		10,010		94,432		137,432		174,931
2008		42,459		55,961		92,560
2009		5,009		27,922
2010		4

* Last Diagonal is as of 9/30/10.

	Incurred Loss Development Factors**
Accident Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		1.553		1.574		1.344		1.112		1.000		1.155		0.803		1.000		1.000		1.000		1.000		1.147		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.727		1.042		1.041		1.232		2.171		1.181		0.544		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		0.831		10.004		1.048		1.000		2.714		0.271		2.407		0.472		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		3.887		1.478		1.696		1.286		0.965		0.994		0.848		1.000		1.000		0.818		1.000		1.000		1.000		1.018		0.983		1.000		1.000		1.000
1993				4.767		1.289		0.578		2.170		0.688		1.124		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		4.764		2.805		1.049		1.106		0.748		0.713		1.000		0.990		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		21.397		1.673		1.894		1.345		0.862		1.014		1.000		1.000		0.962		1.083		1.064		1.032		1.000		0.969		1.000
1996		1.185		1.684		1.004		1.100		1.099		1.000		1.050		1.047		1.000		1.000		1.000		1.000		1.000		1.000
1997		3.929		1.815		1.093		1.000		1.007		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		1.435		2.471		1.193		1.118		1.097		1.062		1.139		1.000		1.000		1.000		1.000		1.000
1999		1.749		1.925		0.961		0.942		1.061		1.000		1.000		1.116		1.104		1.000		1.000
2000		2.420		1.447		1.309		1.576		1.171		1.007		1.000		1.000		1.000		1.000
2001		2.468		2.038		1.533		1.087		1.204		1.069		1.071		1.058		1.000
2002		3.057		1.299		1.030		1.121		1.217		1.000		1.018		1.000
2003		5.566		1.666		1.692		1.182		1.115		0.996		0.977
2004		2.470		1.535		1.226		1.215		1.241		0.940
2005		99.487		1.534		2.173		1.327		1.144
2006		41.050		2.665		1.263		1.274
2007		9.434		1.455		1.379
2008		1.318		1.956
2009		9.884
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	10.981	2.342	1.327	1.144	1.293	0.943	1.065	0.977	1.005	0.992	1.006	1.018	1.000	0.998	0.998	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	32.235	1.829	1.547	1.224	1.184	1.003	1.013	1.035	1.021	1.000	1.013	1.006	1.000	0.997	0.997	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	6.627	1.988	1.299	1.153	1.235	0.974	1.002	1.008	1.000	1.000	1.000	1.004	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	20.122	1.675	1.445	1.223	1.188	1.001	1.006	1.019	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	2.776	1.740	1.306	1.170	1.149	0.983	0.935	1.000	1.000	0.998	1.014	1.020	1.000	0.992	0.998	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	4.488	1.725	1.457	1.224	1.184	1.001	1.016	1.031	1.015	1.000	1.025	1.013	1.000	0.989	0.997	1.000	1.000	1.000	1.000	1.000	1.000
Latest 3	3.478	1.822	1.481	1.270	1.168	0.976	1.024	1.022	1.024	1.000	1.000	1.000	1.000	0.981	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected		2.776		1.725		1.457		1.224		1.184		1.018		1.024		1.010		1.007		1.004		1.003		1.002		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		10.857		3.911		2.267		1.556		1.272		1.074		1.055		1.030		1.020		1.013		1.009		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		17.926		5.048		2.598		1.710		1.338		1.120		1.060		1.036		1.023		1.015		1.010		1.007		1.005		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit I4

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

							Cumulative Incurred Loss						Indicated Ultimate						Indicated
	Incurred Losses						Development Factors						Incurred Losses						Ultimate
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1989		116,570		116,570		116,570		1.000		1.000		1.000		116,570		116,570		116,570		116,570
1990		177,175		177,175		177,175		1.000		1.000		1.000		177,175		177,175		177,175		177,175
1991		21,914		21,914		21,914		1.000		1.000		1.000		21,914		21,914		21,914		21,914
1992		112,491		112,491		112,491		1.000		1.000		1.000		112,491		112,491		112,491		112,491
1993		67,404		67,404		67,404		1.000		1.000		1.000		67,404		67,404		67,404		67,404
1994		83,915		83,915		83,915		1.001		1.000		1.000		83,999		83,915		83,915		83,915
1995		319,296		309,295		309,295		1.002		1.001		1.000		319,935		309,604		309,295		309,295
1996		132,621		132,621		132,621		1.004		1.002		1.001		133,151		132,886		132,754		132,754
1997		130,000		130,000		130,000		1.006		1.004		1.003		130,780		130,520		130,390		130,390
1998		100,908		100,908		100,908		1.009		1.006		1.005		101,816		101,513		101,413		101,413
1999		106,500		106,500		106,500		1.013		1.009		1.007		107,885		107,459		107,246		107,246
2000		137,929		137,926		137,927		1.020		1.013		1.010		140,688		139,719		139,306		139,306
2001		173,307		183,304		183,301		1.030		1.020		1.015		178,506		186,970		186,051		186,051
2002		140,424		142,921		142,922		1.055		1.030		1.023		148,147		147,209		146,209		146,209
2003		145,006		144,416		141,915		1.074		1.055		1.036		155,736		152,359		147,024		147,024
2004		141,204		175,192		167,302		1.272		1.074		1.060		179,611		188,156		177,340		177,340
2005		102,825		136,474		150,975		1.556		1.272		1.120		159,996		173,595		169,092		169,092
2006		85,647		108,142		129,647		2.267		1.556		1.338		194,162		168,269		173,468		173,468
2007		94,432		137,432		174,931		3.911		2.267		1.710		369,324		311,558		299,132		299,132
2008		42,459		55,961		92,560		10.857		3.911		2.598		460,977		218,863		240,471		240,471
2009				5,009		27,922				10.857		5.048				54,383		140,950		140,950
2010						4						17.926						72		54

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit I5

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1989 — 2007 Ultimate Losses

			Indicated Ultimate
			Losses Based on:
	Incurred				Incurred		Selected
Accident	Losses		Paid Loss		Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1989		116,570		116,570		116,570		116,570
1990		177,175		177,175		177,175		177,175
1991		21,914		21,914		21,914		21,914
1992		112,491		112,491		112,491		112,491
1993		67,404		67,404		67,404		67,404
1994		83,915		83,915		83,915		83,915
1995		309,295		309,295		309,295		309,295
1996		132,621		132,621		132,754		132,621
1997		130,000		130,260		130,390		130,000
1998		100,908		101,312		101,413		100,908
1999		106,500		107,246		107,246		106,500
2000		137,927		139,857		139,306		139,306
2001		183,301		187,883		186,051		186,051
2002		142,922		149,349		146,209		146,209
2003		141,915		154,826		147,024		147,024
2004		167,302		179,404		177,340		177,340
2005		150,975		169,941		169,092		169,092
2006		129,647		171,662		173,468		173,468
2007		174,931		280,982		299,132		299,132
Total		2,587,713		2,794,107		2,798,189		2,796,415

Milliman

WSC Direct Business

Exhibit I6

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection

	Selected
	Ultimate		Net Earned		Net Loss
Accident	Losses		Premium		Ratio
Year	@9/30/10		@9/30/10		@9/30/10
1989		116,570		1,491,188		7.8	%
1990		177,175		1,615,610		11.0	%
1991		21,914		1,710,235		1.3	%
1992		112,491		1,799,489		6.3	%
1993		67,404		1,928,505		3.5	%
1994		83,915		2,091,790		4.0	%
1995		309,295		2,254,005		13.7	%
1996		132,621		2,370,733		5.6	%
1997		130,000		2,438,438		5.3	%
1998		100,908		2,483,922		4.1	%
1999		106,500		2,447,346		4.4	%
2000		139,306		2,490,929		5.6	%
2001		186,051		2,551,726		7.3	%
2002		146,209		2,568,988		5.7	%
2003		147,024		2,735,494		5.4	%
2004		177,340		3,001,843		5.9	%
2005		169,092		3,594,615		4.7	%
2006		173,468		3,715,462		4.7	%
2007		299,132		2,908,039		10.3	%
Total		2,796,415		46,198,357		6.1	%
M3L5		519,900		9,504,497		6.0	%

						Loss Ratio
Accident	Net Earned		Selected Loss			Projection
Year	Premium		Ratio			@9/30/10
2008		2,633,369		6.0	%		158,002
2009		2,503,072		6.0	%		150,184
2010		1,794,733		6.0	%		107,684

Milliman

WSC Direct Business
Exhibit I7

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection

	A’priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent					Losses		Ultimate
Year	Losses*		Unreported			Indicated IBNR		@9/30/10		Losses**
2008		158,002		61.5	%		97,171		92,560		189,731
2009		150,184		80.2	%		120,448		27,922		148,370
2010		143,579		94.4	%		135,539		4		101,657
Total		451,765					353,158		120,486		439,758

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit I8

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection

	A’priori		Estimated							Indicated
Accident	Ultimate		Percent			Indicated		Paid Losses		Ultimate
Year	Losses*		Unpaid			Reserve		@9/30/10		Losses**
2008		158,002		65.8	%		103,965		71,948		175,913
2009		150,184		89.0	%		133,664		12,910		146,574
2010		143,579		98.8	%		141,856		0		106,392
Total		451,765					379,485		84,858		428,879

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit I9

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2008 — 2010 Ultimate Losses

					Indicated Ultimate Losses* Based on:
															Selected
	Incurred						Incurred								Ultimate		Ultimate
Accident	Losses		Net Earned		Paid Loss		Loss		Incurred B/F		Paid B/F		Loss Ratio		Losses		Loss Ratio
Year	@9/30/10		Premium*		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2008		92,560		2,633,369		210,088		240,471		189,731		175,913		158,002		215,101		8.2	%
2009		27,922		2,503,072		116,978		140,950		148,370		146,574		150,184		146,501		5.9	%
2010		4		1,794,733		0		54		101,657		106,392		107,684		107,684		6.0	%
Total		120,486		6,931,174		327,066		381,475		439,758		428,879		415,870		469,286		6.8	%

* Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Direct Business
Exhibit I10

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION

EVALUATED AS OF 9/30/10

Summary of Ultimate Losses

											Unpaid
Accident	Ultimate		Incurred				Case		IBNR		Losses
Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		116,570		116,570		116,570		0		0		0
1990		177,175		177,175		177,175		0		0		0
1991		21,914		21,914		21,914		0		0		0
1992		112,491		112,491		112,491		0		0		0
1993		67,404		67,404		67,404		0		0		0
1994		83,915		83,915		83,915		0		0		0
1995		309,295		309,295		309,295		0		0		0
1996		132,621		132,621		132,621		0		0		0
1997		130,000		130,000		130,000		0		0		0
1998		100,908		100,908		100,908		0		0		0
1999		106,500		106,500		106,500		0		0		0
2000		139,306		137,927		137,926		1		1,379		1,380
2001		186,051		183,301		183,300		1		2,750		2,751
2002		146,209		142,922		142,918		4		3,287		3,291
2003		147,024		141,915		141,912		3		5,109		5,112
2004		177,340		167,302		154,792		12,510		10,038		22,548
2005		169,092		150,975		135,953		15,022		18,117		33,139
2006		173,468		129,647		119,625		10,022		43,821		53,843
2007		299,132		174,931		157,413		17,518		124,201		141,719
2008		215,101		92,560		71,948		20,612		122,541		143,153
2009		146,501		27,922		12,910		15,012		118,579		133,591
2010		107,684		4		0		4		107,680		107,684
Total		3,265,701		2,708,199		2,617,490		90,709		557,502		648,211

Milliman

WSC Direct Business
Exhibit I11

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

		Paid ALAE*
Accident Year		12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989			0		6,236		11,180		32,326		43,903		52,874		54,943		57,654		58,197		58,261		58,261		58,261		66,911		66,911		66,911		66,911		66,911		66,911		66,911		66,911		66,911		66,911
1990			2,000		12,515		48,386		52,348		68,232		78,347		93,650		130,181		131,193		131,223		131,223		131,223		131,223		131,223		131,223		131,223		131,223		131,223		131,223		131,223		131,223
1991			0		3,529		8,543		12,791		22,507		26,534		31,165		34,756		33,111		35,254		35,254		35,254		35,254		35,254		35,254		35,254		35,254		35,254		35,254		35,254
1992			1,246		3,784		11,884		39,119		70,438		93,194		99,636		109,948		110,538		111,872		111,872		112,087		112,087		112,087		129,309		129,309		129,309		129,309		129,309
1993			0		0		7,106		10,544		33,750		49,404		49,555		55,605		59,060		59,060		59,060		59,060		59,060		59,060		59,060		59,060		59,060		59,060
1994			0		2,765		24,106		49,438		58,539		84,247		97,303		109,416		116,210		118,511		118,511		118,511		126,284		128,511		128,511		128,511		128,511
1995			4,274		25,089		63,728		108,226		186,137		227,336		239,175		250,575		260,583		268,392		278,386		345,358		352,872		352,941		352,941		352,941
1996			9,229		32,764		51,031		77,705		78,284		80,275		81,238		94,291		97,291		98,377		98,377		98,377		98,377		98,377		98,377
1997			1,051		26,706		93,742		103,351		104,763		104,763		104,763		104,763		104,763		104,763		104,763		104,763		104,763		104,763
1998			0		20,287		46,948		95,579		98,555		111,862		113,308		116,620		116,770		116,770		116,770		116,770		116,770
1999			0		14,889		51,934		76,683		83,983		84,702		84,702		93,566		97,823		111,129		111,129		111,129
2000			4,463		16,695		86,599		133,989		171,107		180,807		184,039		185,043		185,043		185,043		199,759
2001			0		8,741		31,413		58,143		114,688		136,426		149,832		159,064		164,566		165,909
2002			1,072		6,704		24,792		62,594		85,653		130,385		160,793		179,463		185,955
2003			0		41,472		122,602		149,310		151,244		182,013		187,817		199,555
2004			3,585		16,367		59,485		137,867		178,639		218,036		232,333
2005			0		35,842		130,826		231,876		289,636		360,222
2006			6,133		35,947		91,695		166,836		231,532
2007			24,360		109,772		255,780		335,740
2008			5,031		33,591		79,496
2009			1,399		37,628
2010			0
*	Last Diagonal is as of 9/30/10.
		Paid ALAE Development Factors**
Accident Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989					1.793		2.891		1.358		1.204		1.039		1.049		1.009		1.001		1.000		1.000		1.148		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990			6.258		3.866		1.082		1.303		1.148		1.195		1.390		1.008		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991					2.421		1.497		1.760		1.179		1.175		1.115		0.953		1.065		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992			3.037		3.141		3.292		1.801		1.323		1.069		1.103		1.005		1.012		1.000		1.002		1.000		1.000		1.154		1.000		1.000		1.000		1.000
1993							1.484		3.201		1.464		1.003		1.122		1.062		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994					8.718		2.051		1.184		1.439		1.155		1.124		1.062		1.020		1.000		1.000		1.066		1.018		1.000		1.000		1.000
1995			5.870		2.540		1.698		1.720		1.221		1.052		1.048		1.040		1.030		1.037		1.241		1.022		1.000		1.000		1.000
1996			3.550		1.558		1.523		1.007		1.025		1.012		1.161		1.032		1.011		1.000		1.000		1.000		1.000		1.000
1997			25.410		3.510		1.103		1.014		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998					2.314		2.036		1.031		1.135		1.013		1.029		1.001		1.000		1.000		1.000		1.000
1999					3.488		1.477		1.095		1.009		1.000		1.105		1.045		1.136		1.000		1.000
2000			3.741		5.187		1.547		1.277		1.057		1.018		1.005		1.000		1.000		1.107
2001					3.594		1.851		1.973		1.190		1.098		1.062		1.035		1.011
2002			6.254		3.698		2.525		1.368		1.522		1.233		1.116		1.049
2003					2.956		1.218		1.013		1.203		1.032		1.084
2004			4.565		3.634		2.318		1.296		1.221		1.088
2005					3.650		1.772		1.249		1.337
2006			5.861		2.551		1.819		1.548
2007			4.506		2.330		1.437
2008			6.677		3.154
2009			80.586
2010
**	Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs			13.026		3.374		1.822		1.455		1.216		1.074		1.101		1.022		1.022		1.012		1.022		1.024		1.002		1.019		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5			24.407		3.064		1.713		1.295		1.295		1.094		1.074		1.026		1.029		1.021		1.048		1.017		1.004		1.031		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1			7.269		3.166		1.779		1.374		1.210		1.068		1.086		1.024		1.014		1.004		1.000		1.011		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1			6.269		3.113		1.676		1.304		1.254		1.073		1.083		1.027		1.004		1.000		1.000		1.007		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs			6.777		2.911		1.609		1.312		1.211		1.070		1.088		1.025		1.019		1.021		1.055		1.020		1.002		1.017		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5			7.910		2.780		1.595		1.287		1.286		1.085		1.070		1.025		1.023		1.032		1.094		1.020		1.003		1.023		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 3			8.318		2.529		1.602		1.354		1.271		1.105		1.088		1.027		1.034		1.048		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected			6.777		2.780		1.595		1.287		1.286		1.085		1.070		1.025		1.014		1.015		1.010		1.005		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180- Ult		192- Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives			62.071		9.159		3.294		2.065		1.604		1.247		1.149		1.074		1.048		1.034		1.019		1.009		1.004		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177- Ult		189- Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives			126.213		14.778		4.254		2.321		1.708		1.328		1.173		1.092		1.054		1.038		1.023		1.012		1.005		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit I12

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

							Cumulative Paid ALAE						Indicated Ultimate						Indicated
	Paid ALAE						Development Factors						Paid ALAE						Ultimate
Accident Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		ALAE
1989		66,911		66,911		66,911		1.000		1.000		1.000		66,911		66,911		66,911		66,911
1990		131,223		131,223		131,223		1.000		1.000		1.000		131,223		131,223		131,223		131,223
1991		35,254		35,254		35,254		1.000		1.000		1.000		35,254		35,254		35,254		35,254
1992		129,309		129,309		129,309		1.000		1.000		1.000		129,309		129,309		129,309		129,309
1993		59,060		59,060		59,060		1.000		1.000		1.000		59,060		59,060		59,060		59,060
1994		128,511		128,511		128,511		1.000		1.000		1.000		128,511		128,511		128,511		128,511
1995		352,941		352,941		352,941		1.001		1.000		1.000		353,294		352,941		352,941		352,941
1996		98,377		98,377		98,377		1.004		1.001		1.000		98,771		98,475		98,377		98,377
1997		104,763		104,763		104,763		1.009		1.004		1.002		105,706		105,182		104,973		104,973
1998		116,770		116,770		116,770		1.019		1.009		1.005		118,989		117,821		117,354		117,354
1999		111,129		111,129		111,129		1.034		1.019		1.012		114,907		113,240		112,463		112,463
2000		185,043		185,043		199,759		1.048		1.034		1.023		193,925		191,334		204,353		204,353
2001		159,064		164,566		165,909		1.074		1.048		1.038		170,835		172,465		172,214		172,214
2002		160,793		179,463		185,955		1.149		1.074		1.054		184,751		192,743		195,997		195,997
2003		182,013		187,817		199,555		1.247		1.149		1.092		226,970		215,802		217,914		217,914
2004		178,639		218,036		232,333		1.604		1.247		1.173		286,537		271,891		272,527		272,527
2005		231,876		289,636		360,222		2.065		1.604		1.328		478,824		464,576		478,375		478,375
2006		91,695		166,836		231,532		3.294		2.065		1.708		302,043		344,516		395,457		395,457
2007		109,772		255,780		335,740		9.159		3.294		2.321		1,005,402		842,539		779,253		779,253
2008		5,031		33,591		79,496		62.071		9.159		4.254		312,279		307,660		338,176		338,176
2009				1,399		37,628				62.071		14.778				86,837		556,067		556,067
2010						0						126.213						0		0

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit I13

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

		Paid ALAE / Paid Loss +1*
Accident Year		12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989					1.248		1.165		1.373		1.507		1.547		1.541		1.567		1.573		1.573		1.573		1.573		1.574		1.574		1.574		1.574		1.574		1.574		1.574		1.574		1.574		1.574
1990							1.543		1.562		1.666		1.674		1.745		1.855		1.740		1.741		1.741		1.741		1.741		1.741		1.741		1.741		1.741		1.741		1.741		1.741		1.741
1991			1.000		2.412		4.154		1.789		2.389		2.637		2.923		2.623		2.511		2.609		2.609		2.609		2.609		2.609		2.609		2.609		2.609		2.609		2.609		2.609
1992					1.302		1.226		1.588		1.864		2.103		2.179		1.977		1.983		1.994		1.994		1.996		1.996		1.996		2.150		2.150		2.150		2.150		2.150
1993					1.000		1.221		1.328		1.908		2.330		1.867		1.969		1.876		1.876		1.876		1.876		1.876		1.876		1.876		1.876		1.876		1.876
1994			1.000		1.081		1.643		1.689		1.742		2.068		2.233		2.304		2.385		2.412		2.412		2.412		2.505		2.531		2.531		2.531		2.531
1995					2.779		1.965		1.800		2.142		2.039		2.045		2.095		2.139		2.230		2.048		2.117		2.141		2.141		2.141		2.141
1996					2.543		1.875		1.779		1.713		1.666		1.673		1.745		1.734		1.742		1.742		1.742		1.742		1.742		1.742
1997					1.985		1.914		1.868		1.811		1.806		1.806		1.806		1.806		1.806		1.806		1.806		1.806		1.806
1998					2.549		2.734		2.801		2.614		2.426		2.279		2.156		2.157		2.157		2.157		2.157		2.157
1999			1.000		1.839		2.332		2.002		2.098		1.979		1.979		2.082		2.014		2.043		2.043		2.043
2000			1.858		2.265		2.527		2.806		2.600		2.320		2.334		2.342		2.342		2.342		2.448
2001					1.397		1.480		1.503		1.913		1.966		1.926		1.918		1.898		1.905
2002			1.043		1.087		1.248		1.608		1.794		1.981		2.210		2.256		2.301
2003			1.000		2.430		2.994		2.357		2.375		2.517		2.347		2.406
2004			1.239		1.316		1.755		2.187		2.265		2.405		2.501
2005			1.000		2.956		5.391		3.568		3.385		3.650
2006			8.914		2.119		2.071		2.700		2.935
2007					2.581		2.861		3.133
2008			1.119		1.731		2.105
2009			1.280		3.915
2010
*	Last Diagonal is as of 9/30/10.
		Paid ALAE / Paid Loss + 1 Development Factors**
Accident Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989					0.933		1.178		1.097		1.027		0.996		1.017		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990							1.012		1.066		1.005		1.042		1.063		0.938		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991			2.412		1.722		0.431		1.335		1.104		1.108		0.897		0.957		1.039		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992					0.942		1.295		1.174		1.128		1.036		0.907		1.003		1.006		1.000		1.001		1.000		1.000		1.077		1.000		1.000		1.000		1.000
1993					1.221		1.088		1.437		1.221		0.801		1.054		0.953		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994			1.081		1.519		1.028		1.031		1.187		1.080		1.032		1.035		1.011		1.000		1.000		1.038		1.011		1.000		1.000		1.000
1995					0.707		0.916		1.190		0.952		1.003		1.024		1.021		1.042		0.919		1.033		1.011		1.000		1.000		1.000
1996					0.737		0.949		0.963		0.972		1.005		1.043		0.994		1.005		1.000		1.000		1.000		1.000		1.000
1997					0.964		0.976		0.970		0.997		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998					1.073		1.024		0.933		0.928		0.939		0.946		1.001		1.000		1.000		1.000		1.000
1999			1.839		1.268		0.859		1.048		0.943		1.000		1.052		0.967		1.015		1.000		1.000
2000			1.219		1.116		1.110		0.927		0.892		1.006		1.003		1.000		1.000		1.061
2001					1.059		1.015		1.273		1.027		0.980		0.996		0.990		1.005
2002			1.043		1.148		1.288		1.115		1.104		1.115		1.021		1.027
2003			2.430		1.232		0.787		1.007		1.060		0.933		1.034
2004			1.062		1.333		1.246		1.036		1.062		1.054
2005			2.956		1.824		0.662		0.949		1.106
2006			0.238		0.977		1.304		1.118
2007					1.108		1.128
2008			1.548		1.298
2009			4.440
2010
**	Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs			1.842		1.168		1.016		1.093		1.042		1.006		1.006		0.992		1.010		0.998		1.003		1.005		1.001		1.010		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5			2.295		1.308		1.025		1.045		1.072		1.018		1.021		0.997		1.004		1.012		1.007		1.010		1.002		1.015		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1			1.732		1.156		1.033		1.082		1.040		1.013		1.010		0.993		1.007		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1			2.252		1.247		1.054		1.053		1.075		1.013		1.019		0.997		1.002		1.000		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected			1.732		1.156		1.054		1.053		1.040		1.013		1.010		1.003		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives			2.376		1.372		1.187		1.126		1.069		1.028		1.015		1.005		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives			2.969		1.574		1.231		1.141		1.083		1.038		1.018		1.008		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit I14

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	Paid ALAE /		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
	Ratio		Factors for		Ratio
Accident Year	@9/30/10		9/10-Ult		@9/30/10
1989		1.574		1.000		1.574
1990		1.741		1.000		1.741
1991		2.609		1.000		2.609
1992		2.150		1.000		2.150
1993		1.876		1.000		1.876
1994		2.531		1.000		2.531
1995		2.141		1.000		2.141
1996		1.742		1.000		1.742
1997		1.806		1.000		1.806
1998		2.157		1.000		2.157
1999		2.043		1.000		2.043
2000		2.448		1.000		2.448
2001		1.905		1.000		1.905
2002		2.301		1.003		2.308
2003		2.406		1.008		2.425
2004		2.501		1.018		2.546
2005		3.650		1.038		3.788
2006		2.935		1.083		3.179
2007		3.133		1.141		3.575
2008		2.105		1.231		2.591
2009		3.915		1.574		6.162
2010

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Direct Business
Exhibit I15

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

													Ultimate
			Paid ALAE to		Selected						Selected		ALAE to
Accident			Paid Loss		Ultimate		Paid to Paid		Paid ALAE		Ultimate		Ultimate Loss
Year	Paid ALAE		Ratio		Losses		Projection		Projection		ALAE*		Ratio
1989		66,911		0.574		116,570		66,911		66,911		66,911		0.574
1990		131,223		0.741		177,175		131,287		131,223		131,223		0.741
1991		35,254		1.609		21,914		35,260		35,254		35,254		1.609
1992		129,309		1.150		112,491		129,365		129,309		129,309		1.150
1993		59,060		0.876		67,404		59,046		59,060		59,060		0.876
1994		128,511		1.531		83,915		128,474		128,511		128,511		1.531
1995		352,941		1.141		309,295		352,906		352,941		352,941		1.141
1996		98,377		0.742		132,621		98,405		98,377		98,377		0.742
1997		104,763		0.806		130,000		104,780		104,973		104,763		0.806
1998		116,770		1.157		100,908		116,751		117,354		116,770		1.157
1999		111,129		1.043		106,500		111,080		112,463		111,129		1.043
2000		199,759		1.448		139,306		201,715		204,353		203,034		1.457
2001		165,909		0.905		186,051		168,376		172,214		170,295		0.915
2002		185,955		1.308		146,209		191,241		195,997		193,619		1.324
2003		199,555		1.425		147,024		209,509		217,914		213,712		1.454
2004		232,333		1.546		177,340		274,168		272,527		273,348		1.541
2005		360,222		2.788		169,092		471,428		478,375		474,902		2.809
2006		231,532		2.179		173,468		377,987		395,457		386,722		2.229
2007		335,740		2.575		299,132		770,265		779,253		774,759		2.590
2008		79,496		1.591		215,101		342,226		338,176		340,201		1.582
2009		37,628		5.162		146,501		756,238		556,067		293,295		2.002
2010		0				107,684		0		0		215,583		2.002
Total		3,362,377				3,265,701		5,097,418		4,946,709		4,873,718

* Selected Ultimate ALAE for the 2010 year is based on an ALAE to Loss Ratio of 200.2%, which is the weighted average ratio of 2002-2008. Selected Ultimate ALAE for the 2010 year reflects exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit I16

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE

	Ultimate
Accident	ALAE		Paid ALAE		Unpaid ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1989		66,911		66,911		0
1990		131,223		131,223		0
1991		35,254		35,254		0
1992		129,309		129,309		0
1993		59,060		59,060		0
1994		128,511		128,511		0
1995		352,941		352,941		0
1996		98,377		98,377		0
1997		104,763		104,763		0
1998		116,770		116,770		0
1999		111,129		111,129		0
2000		203,034		199,759		3,275
2001		170,295		165,909		4,386
2002		193,619		185,955		7,664
2003		213,712		199,555		14,157
2004		273,348		232,333		41,015
2005		474,902		360,222		114,680
2006		386,722		231,532		155,190
2007		774,759		335,740		439,019
2008		340,201		79,496		260,705
2009		293,295		37,628		255,667
2010		215,583		0		215,583
Total		4,873,718		3,362,377		1,511,341

Milliman

WSC Direct Business
Exhibit I17

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET NOTARY E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid Loss
Accident	Ultimate Loss		Incurred Loss		Paid Loss &		Case		BINR		& ALAE
Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		183,481		183,481		183,481		0		0		0
1990		308,398		308,398		308,398		0		0		0
1991		57,168		57,168		57,168		0		0		0
1992		241,800		241,800		241,800		0		0		0
1993		126,464		126,464		126,464		0		0		0
1994		212,426		212,426		212,426		0		0		0
1995		662,236		662,236		662,236		0		0		0
1996		230,998		230,998		230,998		0		0		0
1997		234,763		234,763		234,763		0		0		0
1998		217,678		217,678		217,678		0		0		0
1999		217,629		217,629		217,629		0		0		0
2000		342,340		337,686		337,685		1		4,654		4,655
2001		356,346		349,210		349,209		1		7,136		7,137
2002		339,828		328,877		328,873		4		10,951		10,955
2003		360,736		341,470		341,467		3		19,266		19,269
2004		450,688		399,635		387,125		12,510		51,053		63,563
2005		643,994		511,197		496,175		15,022		132,797		147,819
2006		560,190		361,179		351,157		10,022		199,011		209,033
2007		1,073,891		510,671		493,153		17,518		563,220		580,738
2008		555,302		172,056		151,444		20,612		383,246		403,858
2009		439,796		65,550		50,538		15,012		374,246		389,258
2010		323,267		4		0		4		323,263		323,267
Total		8,139,419		6,070,576		5,979,867		90,709		2,068,843		2,159,552

Milliman

WSC Direct Business
Exhibit J1

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPAR ERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

		Paid Losses*
Report Year		12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989			121,060		166,712		178,193		197,812		197,812		197,812		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428
1990			123,416		239,138		341,198		337,498		360,443		369,443		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943
1991			125,383		288,075		330,152		357,329		385,579		387,229		397,229		397,229		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979
1992			176,339		317,432		365,518		380,668		389,855		389,855		389,855		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458
1993			139,973		286,714		320,482		320,482		328,482		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982
1994			206,213		331,849		353,030		385,240		407,540		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040
1995			179,090		272,740		332,626		334,567		334,567		338,567		338,929		338,929		338,929		338,929		338,929		338,929		338,929		338,929		338,929		338,929
1996			108,935		233,303		236,785		238,609		251,609		251,494		267,994		267,994		267,994		267,994		267,994		267,994		267,994		267,994		267,994
1997			95,363		180,443		225,233		228,775		246,175		246,175		246,175		246,175		246,175		246,175		246,175		246,175		246,175		246,175
1998			101,788		203,660		227,564		229,149		232,949		232,949		267,619		287,619		287,619		287,619		287,619		287,619		287,619
1999			112,482		129,620		135,420		135,420		135,420		135,420		135,420		135,420		135,420		135,420		135,420		135,420
2000			126,787		171,811		177,398		177,398		177,398		178,298		178,298		178,298		178,298		178,298		178,298
2001			89,130		263,832		288,480		301,314		337,114		337,114		337,114		337,114		337,114		337,114
2002			133,485		234,669		257,435		258,126		262,262		262,262		262,262		262,262		262,262
2003			82,508		144,671		141,570		141,668		141,668		141,668		141,668		141,668
2004			105,428		150,734		172,094		172,094		172,094		172,094		172,094
2005			103,692		178,745		197,240		197,240		197,240		197,240
2006			86,340		221,110		255,255		255,255		255,255
2007			149,910		234,760		256,892		262,539
2008			234,273		368,286		378,614
2009			173,149		259,263
2010			113,219
*	Last Diagonal is as of 9/30/10.
		Paid Loss Development Factors**
Report Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989			1.377		1.069		1.110		1.000		1.000		1.018		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990			1.938		1.427		0.989		1.068		1.025		1.015		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991			2.298		1.146		1.082		1.079		1.004		1.026		1.000		1.014		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992			1.800		1.151		1.041		1.024		1.000		1.000		1.027		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993			2.048		1.118		1.000		1.025		1.011		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994			1.609		1.064		1.091		1.058		1.048		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995			1.523		1.220		1.006		1.000		1.012		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996			2.142		1.015		1.008		1.054		1.000		1.066		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997			1.892		1.248		1.016		1.076		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998			2.001		1.117		1.007		1.017		1.000		1.149		1.075		1.000		1.000		1.000		1.000		1.000
1999			1.152		1.045		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
2000			1.355		1.033		1.000		1.000		1.005		1.000		1.000		1.000		1.000		1.000
2001			2.960		1.093		1.044		1.119		1.000		1.000		1.000		1.000		1.000
2002			1.758		1.097		1.003		1.016		1.000		1.000		1.000		1.000
2003			1.753		0.979		1.001		1.000		1.000		1.000		1.000
2004			1.430		1.142		1.000		1.000		1.000		1.000
2005			1.724		1.103		1.000		1.000		1.000
2006			2.561		1.154		1.000		1.000
2007			1.566		1.094		1.029
2008			1.572		1.038
2009			1.713
2010
**	Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs			1.818		1.118		1.023		1.030		1.006		1.017		1.007		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5			1.827		1.106		1.006		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1			1.793		1.108		1.019		1.026		1.004		1.009		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1			1.670		1.113		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs			1.771		1.120		1.025		1.035		1.008		1.016		1.007		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5			1.739		1.095		1.007		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 3			1.614		1.085		1.011		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
			12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264	To Ult
Selected			1.739		1.095		1.025		1.015		1.008		1.005		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180- Ult		192- Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives			2.015		1.159		1.058		1.032		1.017		1.009		1.004		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives			2.464		1.331		1.082		1.038		1.021		1.011		1.005		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit J2

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

							Cumulative Paid Loss						Indicated Ultimate						Indicated
	Paid Losses						Development Factors								Paid Losses				Ultimate
Report Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1989		201,428		201,428		201,428		1.000		1.000		1.000		201,428		201,428		201,428		201,428
1990		374,943		374,943		374,943		1.000		1.000		1.000		374,943		374,943		374,943		374,943
1991		402,979		402,979		402,979		1.000		1.000		1.000		402,979		402,979		402,979		402,979
1992		400,458		400,458		400,458		1.000		1.000		1.000		400,458		400,458		400,458		400,458
1993		331,982		331,982		331,982		1.000		1.000		1.000		331,982		331,982		331,982		331,982
1994		427,040		427,040		427,040		1.000		1.000		1.000		427,040		427,040		427,040		427,040
1995		338,929		338,929		338,929		1.000		1.000		1.000		338,929		338,929		338,929		338,929
1996		267,994		267,994		267,994		1.000		1.000		1.000		267,994		267,994		267,994		267,994
1997		246,175		246,175		246,175		1.000		1.000		1.000		246,175		246,175		246,175		246,175
1998		287,619		287,619		287,619		1.000		1.000		1.000		287,619		287,619		287,619		287,619
1999		135,420		135,420		135,420		1.000		1.000		1.000		135,420		135,420		135,420		135,420
2000		178,298		178,298		178,298		1.000		1.000		1.000		178,298		178,298		178,298		178,298
2001		337,114		337,114		337,114		1.001		1.000		1.000		337,451		337,114		337,114		337,114
2002		262,262		262,262		262,262		1.004		1.001		1.000		263,311		262,524		262,262		262,262
2003		141,668		141,668		141,668		1.009		1.004		1.002		142,943		142,235		141,951		141,951
2004		172,094		172,094		172,094		1.017		1.009		1.005		175,020		173,643		172,954		172,954
2005		197,240		197,240		197,240		1.032		1.017		1.011		203,552		200,593		199,410		199,410
2006		255,255		255,255		255,255		1.058		1.032		1.021		270,060		263,423		260,615		260,615
2007		234,760		256,892		262,539		1.159		1.058		1.038		272,087		271,792		272,515		272,515
2008		234,273		368,286		378,614		2.015		1.159		1.082		472,060		426,843		409,660		409,660
2009				173,149		259,263				2.015		1.331				348,895		345,079		345,079
2010						113,219						2.464						278,972		209,229

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit J3

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’
E&O GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

		Incurred Losses*
Report Year		12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989			212,485		212,224		198,449		207,812		213,945		208,965		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428		201,428
1990			382,912		446,988		435,161		446,254		381,502		403,744		391,745		391,440		391,440		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943		374,943
1991			442,808		405,750		379,684		416,193		399,443		397,229		397,229		397,229		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979		402,979
1992			490,748		442,338		424,111		401,146		389,855		389,855		389,855		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458		400,458
1993			466,735		452,488		355,397		370,482		338,482		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982		331,982
1994			483,985		534,346		468,107		433,655		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040		427,040
1995			421,682		370,641		382,170		341,567		363,887		345,567		338,929		338,929		338,929		338,929		338,929		338,929		338,929		338,929		338,929		338,929
1996			359,256		341,185		330,054		286,329		261,609		261,494		267,994		267,994		267,994		267,994		267,994		267,994		267,994		267,994		267,994
1997			398,454		309,886		254,233		253,775		246,175		246,175		246,175		246,175		246,175		246,175		246,175		246,175		246,175		246,175
1998			342,324		275,516		254,964		256,549		260,349		260,349		292,619		287,619		287,619		287,619		287,619		287,619		287,619
1999			212,441		176,768		145,420		145,420		145,420		145,420		145,420		145,420		135,420		135,420		135,420		135,420
2000			278,322		196,377		190,630		189,946		187,398		178,299		178,298		178,298		178,298		178,298		178,298
2001			241,885		360,823		347,464		362,067		356,645		337,114		337,114		337,114		337,114		337,114
2002			166,872		289,688		282,872		286,989		262,263		262,263		262,262		262,262		262,262
2003			93,879		148,917		141,670		141,670		141,670		141,669		141,668		141,668
2004			136,460		152,613		173,206		173,203		172,094		172,094		172,094
2005			141,148		183,538		200,885		197,241		197,241		197,240
2006			191,546		243,846		259,551		255,255		255,255
2007			273,483		287,843		294,287		289,931
2008			356,284		424,731		420,141
2009			279,026		351,844
2010			287,954
*	Last Diagonal is as of 9/30/10.
		Incurred Loss Development Factors**
Report Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989			0.999		0.935		1.047		1.030		0.977		0.964		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990			1.167		0.974		1.025		0.855		1.058		0.970		0.999		1.000		0.958		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991			0.916		0.936		1.096		0.960		0.994		1.000		1.000		1.014		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992			0.901		0.959		0.946		0.972		1.000		1.000		1.027		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993			0.969		0.785		1.042		0.914		0.981		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994			1.104		0.876		0.926		0.985		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995			0.879		1.031		0.894		1.065		0.950		0.981		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996			0.950		0.967		0.868		0.914		1.000		1.025		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997			0.778		0.820		0.998		0.970		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998			0.805		0.925		1.006		1.015		1.000		1.124		0.983		1.000		1.000		1.000		1.000		1.000
1999			0.832		0.823		1.000		1.000		1.000		1.000		1.000		0.931		1.000		1.000		1.000
2000			0.706		0.971		0.996		0.987		0.951		1.000		1.000		1.000		1.000		1.000
2001			1.492		0.963		1.042		0.985		0.945		1.000		1.000		1.000		1.000
2002			1.736		0.976		1.015		0.914		1.000		1.000		1.000		1.000
2003			1.586		0.951		1.000		1.000		1.000		1.000		1.000
2004			1.118		1.135		1.000		0.994		1.000		1.000
2005			1.300		1.095		0.982		1.000		1.000
2006			1.273		1.064		0.983		1.000
2007			1.053		1.022		0.980
2008			1.192		0.986
2009			1.362
2010
**	Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Simple Avg
All Yrs			1.101		0.960		0.992		0.975		0.992		1.004		1.001		0.996		0.997		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5			1.236		1.060		0.989		0.981		0.989		1.000		1.000		0.986		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Medial Avg
All Yrs x1			1.088		0.960		0.993		0.977		0.990		0.998		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5x1			1.255		1.060		0.988		0.998		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Volume Wtd
All Yrs			1.041		0.949		0.988		0.968		0.992		1.003		1.001		0.999		0.996		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 5			1.224		1.042		0.987		0.975		0.983		1.000		1.000		0.992		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Latest 3			1.202		1.017		0.982		0.998		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Development Factor Selection
		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected			1.224		1.042		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180- Ult		192- Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives			1.276		1.042		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives			1.480		1.096		1.010		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit J4

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

							Cumulative Incurred Loss						Indicated Ultimate						Indicated
	Incurred Losses						Development Factors						Incurred Losses						Ultimate
Report Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1989		201,428		201,428		201,428		1.000		1.000		1.000		201,428		201,428		201,428		201,428
1990		374,943		374,943		374,943		1.000		1.000		1.000		374,943		374,943		374,943		374,943
1991		402,979		402,979		402,979		1.000		1.000		1.000		402,979		402,979		402,979		402,979
1992		400,458		400,458		400,458		1.000		1.000		1.000		400,458		400,458		400,458		400,458
1993		331,982		331,982		331,982		1.000		1.000		1.000		331,982		331,982		331,982		331,982
1994		427,040		427,040		427,040		1.000		1.000		1.000		427,040		427,040		427,040		427,040
1995		338,929		338,929		338,929		1.000		1.000		1.000		338,929		338,929		338,929		338,929
1996		267,994		267,994		267,994		1.000		1.000		1.000		267,994		267,994		267,994		267,994
1997		246,175		246,175		246,175		1.000		1.000		1.000		246,175		246,175		246,175		246,175
1998		287,619		287,619		287,619		1.000		1.000		1.000		287,619		287,619		287,619		287,619
1999		135,420		135,420		135,420		1.000		1.000		1.000		135,420		135,420		135,420		135,420
2000		178,298		178,298		178,298		1.000		1.000		1.000		178,298		178,298		178,298		178,298
2001		337,114		337,114		337,114		1.000		1.000		1.000		337,114		337,114		337,114		337,114
2002		262,262		262,262		262,262		1.000		1.000		1.000		262,262		262,262		262,262		262,262
2003		141,669		141,668		141,668		1.000		1.000		1.000		141,669		141,668		141,668		141,668
2004		172,094		172,094		172,094		1.000		1.000		1.000		172,094		172,094		172,094		172,094
2005		197,241		197,241		197,240		1.000		1.000		1.000		197,241		197,241		197,240		197,240
2006		259,551		255,255		255,255		1.000		1.000		1.000		259,551		255,255		255,255		255,255
2007		287,843		294,287		289,931		1.042		1.000		1.000		299,932		294,287		289,931		289,931
2008		356,284		424,731		420,141		1.276		1.042		1.010		454,618		442,570		424,342		424,342
2009				279,026		351,844				1.276		1.096				356,037		385,621		385,621
2010						287,954						1.480						426,172		319,629

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit J5

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1989 — 2007 Ultimate Losses

			Indicated Ultimate
			Losses Based on:
	Incurred				Incurred		Selected
	Losses		Paid Loss		Loss		Ultimate
Report Year	@9/30/10		Projection		Projection		Losses
1989		201,428		201,428		201,428		201,428
1990		374,943		374,943		374,943		374,943
1991		402,979		402,979		402,979		402,979
1992		400,458		400,458		400,458		400,458
1993		331,982		331,982		331,982		331,982
1994		427,040		427,040		427,040		427,040
1995		338,929		338,929		338,929		338,929
1996		267,994		267,994		267,994		267,994
1997		246,175		246,175		246,175		246,175
1998		287,619		287,619		287,619		287,619
1999		135,420		135,420		135,420		135,420
2000		178,298		178,298		178,298		178,298
2001		337,114		337,114		337,114		337,114
2002		262,262		262,262		262,262		262,262
2003		141,668		141,951		141,668		141,668
2004		172,094		172,954		172,094		172,094
2005		197,240		199,410		197,240		197,240
2006		255,255		260,615		255,255		255,255
2007		289,931		272,515		289,931		289,931
Total		5,248,829		5,240,086		5,248,829		5,248,829

Milliman

WSC Direct Business
Exhibit J6

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection

	Selected
	Ultimate		Net Earned		Net Loss
	Losses		Premium		Ratio
Report Year	@9/30/10		@9/30/10		@9/30/10
1989		201,428		1,864,896		10.8	%
1990		374,943		1,959,934		19.1	%
1991		402,979		2,038,469		19.8	%
1992		400,458		1,714,987		23.4	%
1993		331,982		1,753,006		18.9	%
1994		427,040		1,755,548		24.3	%
1995		338,929		1,710,183		19.8	%
1996		267,994		1,688,952		15.9	%
1997		246,175		1,648,534		14.9	%
1998		287,619		1,570,424		18.3	%
1999		135,420		1,487,807		9.1	%
2000		178,298		1,407,084		12.7	%
2001		337,114		1,360,228		24.8	%
2002		262,262		1,319,712		19.9	%
2003		141,668		1,289,826		11.0	%
2004		172,094		1,253,419		13.7	%
2005		197,240		1,217,237		16.2	%
2006		255,255		1,176,116		21.7	%
2007		289,931		1,147,275		25.3	%
Total		5,248,829		29,363,637		17.9	%
2005-2007		742,426		3,540,628		21.0	%

						Loss Ratio
	Net Earned		Selected Loss			Projection
Report Year	Premium		Ratio			@9/30/10
2008		1,105,363		21.0	%		232,126
2009		1,093,290		21.0	%		229,591
2010		916,933		21.0	%		192,556

Milliman

WSC Direct Business
Exhibit J7

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection

	A’priori		Estimated					Incurred		Indicated
	Ultimate		Percent					Losses		Ultimate
Report Year	Losses*		Unreported			Indicated IBNR		@9/30/10		Losses**
2008		232,126		1.0	%		2,321		420,141		422,462
2009		229,591		8.8	%		20,204		351,844		372,048
2010		256,741		32.4	%		83,184		287,954		278,354
Total		718,458					105,709		1,059,939		1,072,864

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit J8

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection

	A’priori		Estimated							Indicated
	Ultimate		Percent			Indicated		Paid Losses		Ultimate
Report Year	Losses*		Unpaid			Unpaid		@9/30/10		Losses**
2008		232,126		7.6	%		17,642		378,614		396,256
2009		229,591		24.9	%		57,168		259,263		316,431
2010		256,741		59.4	%		152,504		113,219		199,292
Total		718,458					227,314		751,096		911,979

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of expsoure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

WSC Direct Business
Exhibit J9

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2008 — 2010 Ultimate Losses

					Indicated Ultimate Losses*Based on:
															Selected
	Incurred						Incurred								Ultimate		Ultimate
	Losses		Net Earned		Paid Loss		Loss		Incurred B/F		Paid B/F		Loss Ratio		Losses		Loss Ratio
Report Year	@9/30/10		Premium*		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2008		420,141		1,105,363		409,660		424,342		422,462		396,256		232,126		423,402		38.3	%
2009		351,844		1,093,290		345,079		385,621		372,048		316,431		229,591		378,835		34.7	%
2010		287,954		916,933		209,229		319,629		278,354		199,292		192,556		319,629		34.9	%
Total		1,059,939		3,115,586		963,968		1,129,592		1,072,864		911,979		654,273		1,121,866		36.0	%

* Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Direct Business
Exhibit J10

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses

											Unpaid
	Ultimate		Incurred				Case		IBNR		Losses
Report Year	Losses		Losses		Paid Losses		Outstanding		@9/30/10		@9/30/10
1989		201,428		201,428		201,428		0		0		0
1990		374,943		374,943		374,943		0		0		0
1991		402,979		402,979		402,979		0		0		0
1992		400,458		400,458		400,458		0		0		0
1993		331,982		331,982		331,982		0		0		0
1994		427,040		427,040		427,040		0		0		0
1995		338,929		338,929		338,929		0		0		0
1996		267,994		267,994		267,994		0		0		0
1997		246,175		246,175		246,175		0		0		0
1998		287,619		287,619		287,619		0		0		0
1999		135,420		135,420		135,420		0		0		0
2000		178,298		178,298		178,298		0		0		0
2001		337,114		337,114		337,114		0		0		0
2002		262,262		262,262		262,262		0		0		0
2003		141,668		141,668		141,668		0		0		0
2004		172,094		172,094		172,094		0		0		0
2005		197,240		197,240		197,240		0		0		0
2006		255,255		255,255		255,255		0		0		0
2007		289,931		289,931		262,539		27,392		0		27,392
2008		423,402		420,141		378,614		41,527		3,261		44,788
2009		378,835		351,844		259,263		92,581		26,991		119,572
2010		319,629		287,954		113,219		174,735		31,675		206,410
Total		6,370,695		6,308,768		5,972,533		336,235		61,927		398,162

Milliman

WSC Direct Business
Exhibit J11

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

	Paid ALAE*
Report Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		22,221		39,653		42,883		60,160		62,085		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218		63,218
1990		8,502		58,579		92,088		100,178		108,951		116,198		117,495		118,238		118,238		118,238		118,238		118,238		118,238		118,238		118,238		118,238		118,238		118,238		118,238		118,238		118,238
1991		6,023		70,419		115,527		161,837		194,670		195,694		196,752		196,752		200,072		200,072		200,072		200,072		200,072		200,072		200,072		200,072		200,072		200,072		200,072		200,072
1992		16,190		66,169		129,325		145,913		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728		146,728
1993		39,852		121,087		153,024		156,836		158,927		162,840		162,840		162,840		162,840		162,840		162,840		162,840		162,840		162,840		162,840		162,840		162,840		162,840
1994		42,283		177,177		265,614		284,745		297,132		315,565		315,565		315,565		315,565		315,565		315,565		315,565		315,565		315,565		315,565		315,565		315,565
1995		13,157		72,911		114,189		115,219		115,332		120,574		121,557		123,013		124,255		124,255		124,255		124,255		124,255		124,255		124,255		124,255
1996		17,557		56,497		65,085		86,758		97,995		98,863		101,122		101,122		101,122		101,122		101,122		101,122		101,122		101,122		101,122
1997		38,552		73,031		84,208		85,455		91,603		91,603		91,603		91,603		91,603		91,603		91,603		91,603		91,603		91,603
1998		16,879		52,686		56,637		58,063		59,708		73,493		91,753		101,729		102,135		102,135		102,135		102,135		102,135
1999		8,271		12,161		14,903		14,903		15,391		16,123		16,542		16,542		16,542		16,542		16,542		16,542
2000		20,345		36,881		39,196		39,196		39,196		41,974		41,974		41,974		41,974		41,974		41,974
2001		7,420		26,222		32,250		37,541		44,297		44,297		44,297		44,297		44,297		44,297
2002		127		75,578		95,896		105,037		105,037		105,037		105,037		105,037		105,037
2003		15,439		58,760		63,828		63,828		63,828		63,828		63,828		63,828
2004		12,271		31,885		31,885		31,885		31,885		31,885		31,885
2005		19,099		66,367		73,476		74,914		74,964		74,964
2006		2,705		6,257		23,431		23,431		23,431
2007		25,000		30,291		32,713		37,568
2008		3,463		26,988		26,988
2009		12,668		16,587
2010		0

* Last Diagonal is as of 9/30/10.

	Paid ALAE Development Factors**
Report Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
1989		1.784		1.081		1.403		1.032		1.018		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		6.890		1.572		1.088		1.088		1.067		1.011		1.006		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		11.692		1.641		1.401		1.203		1.005		1.005		1.000		1.017		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		4.087		1.954		1.128		1.006		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993		3.038		1.264		1.025		1.013		1.025		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		4.190		1.499		1.072		1.044		1.062		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		5.542		1.566		1.009		1.001		1.045		1.008		1.012		1.010		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		3.218		1.152		1.333		1.130		1.009		1.023		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.894		1.153		1.015		1.072		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		3.121		1.075		1.025		1.028		1.231		1.248		1.109		1.004		1.000		1.000		1.000		1.000
1999		1.470		1.225		1.000		1.033		1.048		1.026		1.000		1.000		1.000		1.000		1.000
2000		1.813		1.063		1.000		1.000		1.071		1.000		1.000		1.000		1.000		1.000
2001		3.534		1.230		1.164		1.180		1.000		1.000		1.000		1.000		1.000
2002		595.102		1.269		1.095		1.000		1.000		1.000		1.000		1.000
2003		3.806		1.086		1.000		1.000		1.000		1.000		1.000
2004		2.598		1.000		1.000		1.000		1.000		1.000
2005		3.475		1.107		1.020		1.001		1.000
2006		2.313		3.745		1.000		1.000
2007		1.212		1.080		1.203
2008		7.793		1.000
2009		1.432
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	31.905	1.388	1.104	1.046	1.034	1.020	1.008	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	3.245	1.586	1.044	1.000	1.000	1.000	1.000	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	3.879	1.279	1.093	1.039	1.023	1.005	1.001	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	2.407	1.062	1.007	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Volume Wtd
All Yrs	3.384	1.339	1.104	1.052	1.032	1.014	1.007	1.003	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	2.352	1.165	1.036	1.000	1.000	1.000	1.000	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 3	1.834	1.308	1.062	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		To Ult
Selected		3.384		1.339		1.104		1.052		1.032		1.014		1.007		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult
Dec Cumulatives		5.563		1.644		1.228		1.112		1.057		1.024		1.010		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
		9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult
Sep Cumulatives		8.328		2.230		1.321		1.140		1.070		1.032		1.014		1.005		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Direct Business
Exhibit J12

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

							Cumulative Paid ALAE						Indicated Ultimate						Indicated
	Paid ALAE						Development Factors						Paid ALAE						Ultimate
Report Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		ALAE
1989		63,218		63,218		63,218		1.000		1.000		1.000		63,218		63,218		63,218		63,218
1990		118,238		118,238		118,238		1.000		1.000		1.000		118,238		118,238		118,238		118,238
1991		200,072		200,072		200,072		1.000		1.000		1.000		200,072		200,072		200,072		200,072
1992		146,728		146,728		146,728		1.000		1.000		1.000		146,728		146,728		146,728		146,728
1993		162,840		162,840		162,840		1.000		1.000		1.000		162,840		162,840		162,840		162,840
1994		315,565		315,565		315,565		1.000		1.000		1.000		315,565		315,565		315,565		315,565
1995		124,255		124,255		124,255		1.000		1.000		1.000		124,255		124,255		124,255		124,255
1996		101,122		101,122		101,122		1.000		1.000		1.000		101,122		101,122		101,122		101,122
1997		91,603		91,603		91,603		1.000		1.000		1.000		91,603		91,603		91,603		91,603
1998		102,135		102,135		102,135		1.000		1.000		1.000		102,135		102,135		102,135		102,135
1999		16,542		16,542		16,542		1.000		1.000		1.000		16,542		16,542		16,542		16,542
2000		41,974		41,974		41,974		1.000		1.000		1.000		41,974		41,974		41,974		41,974
2001		44,297		44,297		44,297		1.003		1.000		1.000		44,430		44,297		44,297		44,297
2002		105,037		105,037		105,037		1.010		1.003		1.001		106,087		105,352		105,142		105,142
2003		63,828		63,828		63,828		1.024		1.010		1.005		65,360		64,466		64,147		64,147
2004		31,885		31,885		31,885		1.057		1.024		1.014		33,702		32,650		32,331		32,331
2005		74,914		74,964		74,964		1.112		1.057		1.032		83,304		79,237		77,363		77,363
2006		23,431		23,431		23,431		1.228		1.112		1.070		28,773		26,055		25,071		25,071
2007		30,291		32,713		37,568		1.644		1.228		1.140		49,798		40,172		42,828		42,828
2008		3,463		26,988		26,988		5.563		1.644		1.321		19,265		44,368		35,651		35,651
2009				12,668		16,587				5.563		2.230				70,472		36,989		36,989
2010						0						8.328						0		0

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.
The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Direct Business
Exhibit J13

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION

EVALUATED AS OF 9/30/10

	Paid ALAE / Paid Loss +1*
Report Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264
1989		1.184		1.238		1.241		1.304		1.314		1.320		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314		1.314
1990		1.069		1.245		1.270		1.297		1.302		1.315		1.313		1.315		1.315		1.315		1.315		1.315		1.315		1.315		1.315		1.315		1.315		1.315		1.315		1.315		1.315
1991		1.048		1.244		1.350		1.453		1.505		1.505		1.495		1.495		1.496		1.496		1.496		1.496		1.496		1.496		1.496		1.496		1.496		1.496		1.496		1.496
1992		1.092		1.208		1.354		1.383		1.376		1.376		1.376		1.366		1.366		1.366		1.366		1.366		1.366		1.366		1.366		1.366		1.366		1.366		1.366
1993		1.285		1.422		1.477		1.489		1.484		1.491		1.491		1.491		1.491		1.491		1.491		1.491		1.491		1.491		1.491		1.491		1.491		1.491
1994		1.205		1.534		1.752		1.739		1.729		1.739		1.739		1.739		1.739		1.739		1.739		1.739		1.739		1.739		1.739		1.739		1.739
1995		1.073		1.267		1.343		1.344		1.345		1.356		1.359		1.363		1.367		1.367		1.367		1.367		1.367		1.367		1.367		1.367
1996		1.161		1.242		1.275		1.364		1.389		1.393		1.377		1.377		1.377		1.377		1.377		1.377		1.377		1.377		1.377
1997		1.404		1.405		1.374		1.374		1.372		1.372		1.372		1.372		1.372		1.372		1.372		1.372		1.372		1.372
1998		1.166		1.259		1.249		1.253		1.256		1.315		1.343		1.354		1.355		1.355		1.355		1.355		1.355
1999		1.074		1.094		1.110		1.110		1.114		1.119		1.122		1.122		1.122		1.122		1.122		1.122
2000		1.160		1.215		1.221		1.221		1.221		1.235		1.235		1.235		1.235		1.235		1.235
2001		1.083		1.099		1.112		1.125		1.131		1.131		1.131		1.131		1.131		1.131
2002		1.001		1.322		1.373		1.407		1.401		1.401		1.401		1.401		1.401
2003		1.187		1.406		1.451		1.451		1.451		1.451		1.451		1.451
2004		1.116		1.212		1.185		1.185		1.185		1.185		1.185
2005		1.184		1.371		1.373		1.380		1.380		1.380
2006		1.031		1.028		1.092		1.092		1.092
2007		1.167		1.129		1.127		1.143
2008		1.015		1.073		1.071
2009		1.073		1.064
2010		1.000

* Last Diagonal is as of 9/30/10.

	Paid ALAE / Paid Loss + 1 Development Factors**
Report Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108-120		120-132		132-144		144-156		156-168		168-180		180 - 192		192 - 204		204-216		216-228		228-240		240-252		252-264		To Ult
1989		1.046		1.002		1.051		1.007		1.004		0.996		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.165		1.020		1.021		1.004		1.009		0.999		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.187		1.085		1.076		1.036		1.000		0.993		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		1.107		1.120		1.022		0.995		1.000		1.000		0.993		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1993		1.107		1.039		1.008		0.996		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		1.273		1.142		0.992		0.994		1.006		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		1.181		1.060		1.001		1.000		1.008		1.002		1.003		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		1.070		1.026		1.070		1.019		1.003		0.989		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.000		0.978		1.000		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		1.080		0.992		1.004		1.002		1.047		1.021		1.008		1.001		1.000		1.000		1.000		1.000
1999		1.019		1.015		1.000		1.003		1.005		1.003		1.000		1.000		1.000		1.000		1.000
2000		1.047		1.005		1.000		1.000		1.012		1.000		1.000		1.000		1.000		1.000
2001		1.015		1.011		1.012		1.006		1.000		1.000		1.000		1.000		1.000
2002		1.321		1.038		1.025		0.995		1.000		1.000		1.000		1.000
2003		1.185		1.032		1.000		1.000		1.000		1.000		1.000
2004		1.085		0.978		1.000		1.000		1.000		1.000
2005		1.158		1.001		1.005		1.000		1.000
2006		0.997		1.062		1.000		1.000
2007		0.968		0.999		1.019
2008		1.058		0.998
2009		0.989
2010

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Simple Avg
All Yrs	1.098	1.030	1.016	1.003	1.006	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5	1.034	1.007	1.005	0.999	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Medial Avg
All Yrs x1	1.093	1.027	1.014	1.002	1.003	0.999	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Latest 5x1	1.014	0.999	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

Development Factor Selection
	12 - 24			24 - 36			36 - 48			48 - 60			60 - 72			72 - 84			84 - 96			96 - 108			108-120			120-132			132-144			144-156			156-168			168-180			180 - 192			192 - 204			204-216			216-228			228-240			240-252			252-264			To Ult
Selected		1.093			1.027			1.014			1.003			1.002			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000
		12-Ult	24-Ult			36-Ult			48-Ult			60-Ult			72-Ult			84-Ult			96-Ult			108-Ult			120-Ult			132-Ult			144-Ult			156-Ult			168-Ult			180-Ult			192-Ult			204-Ult			216-Ult			228-Ult			240-Ult			252-Ult			264-Ult
Dec Cumulatives		1.144			1.047			1.019			1.005			1.002			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000
		9-Ult			21-Ult			33-Ult			45-Ult			57-Ult			69-Ult			81-Ult			93-Ult			105-Ult			117-Ult			129-Ult			141-Ult			153-Ult			165-Ult			177-Ult			189-Ult			201-Ult			213-Ult			225-Ult			237-Ult			249-Ult			261-Ult
Sep Cumulatives		1.226			1.071			1.026			1.008			1.003			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000			1.000

Milliman

WSC Direct Business
Exhibit J14

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	Paid ALAE /		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
	Ratio		Factors for		Ratio
Report Year	@9/30/10		9/10-Ult		@9/30/10
1989		1.314		1.000		1.314
1990		1.315		1.000		1.315
1991		1.496		1.000		1.496
1992		1.366		1.000		1.366
1993		1.491		1.000		1.491
1994		1.739		1.000		1.739
1995		1.367		1.000		1.367
1996		1.377		1.000		1.377
1997		1.372		1.000		1.372
1998		1.355		1.000		1.355
1999		1.122		1.000		1.122
2000		1.235		1.000		1.235
2001		1.131		1.000		1.131
2002		1.401		1.000		1.401
2003		1.451		1.000		1.451
2004		1.185		1.000		1.185
2005		1.380		1.000		1.380
2006		1.092		1.003		1.095
2007		1.143		1.008		1.152
2008		1.071		1.026		1.099
2009		1.064		1.071		1.140
2010		1.000		1.226		1.226

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Direct Business
Exhibit J15

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

													Ultimate
			Paid ALAE to		Selected						Selected		ALAE to
			Paid Loss		Ultimate		Paid to Paid		Paid ALAE		Ultimate		Ultimate Loss
Report Year	Paid ALAE		Ratio		Losses		Projection		Projection		ALAE*		Ratio
1989		63,218		0.314		201,428		63,248		63,218		63,218		0.314
1990		118,238		0.315		374,943		118,107		118,238		118,238		0.315
1991		200,072		0.496		402,979		199,878		200,072		200,072		0.496
1992		146,728		0.366		400,458		146,568		146,728		146,728		0.366
1993		162,840		0.491		331,982		163,003		162,840		162,840		0.491
1994		315,565		0.739		427,040		315,583		315,565		315,565		0.739
1995		124,255		0.367		338,929		124,387		124,255		124,255		0.367
1996		101,122		0.377		267,994		101,034		101,122		101,122		0.377
1997		91,603		0.372		246,175		91,577		91,603		91,603		0.372
1998		102,135		0.355		287,619		102,105		102,135		102,135		0.355
1999		16,542		0.122		135,420		16,521		16,542		16,542		0.122
2000		41,974		0.235		178,298		41,900		41,974		41,974		0.235
2001		44,297		0.131		337,114		44,162		44,297		44,297		0.131
2002		105,037		0.401		262,262		105,167		105,142		105,037		0.401
2003		63,828		0.451		141,668		63,892		64,147		63,828		0.451
2004		31,885		0.185		172,094		31,837		32,331		31,885		0.185
2005		74,964		0.380		197,240		74,951		77,363		74,964		0.380
2006		23,431		0.095		255,255		24,249		25,071		23,431		0.092
2007		37,568		0.152		289,931		44,070		42,828		43,449		0.150
2008		26,988		0.099		423,402		41,917		35,651		38,784		0.092
2009		16,587		0.140		378,835		53,037		36,989		45,013		0.119
2010		0		0.226		319,629		72,236		0		64,245		0.201
Total		1,908,877				6,370,695		2,039,429		1,948,111		2,019,225

* Selected Ultimate ALAE for the 2010 year reflects exposure as of 9/30/10 and is based on an ALAE to Loss Ratio of 20.1% which is the weighted average ratio of 2002-2009.

Milliman

WSC Direct Business
Exhibit J16

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE

	Ultimate
	ALAE		Paid ALAE		Unpaid ALAE
Report Year	@9/30/10		@9/30/10		@9/30/10
1989		63,218		63,218		0
1990		118,238		118,238		0
1991		200,072		200,072		0
1992		146,728		146,728		0
1993		162,840		162,840		0
1994		315,565		315,565		0
1995		124,255		124,255		0
1996		101,122		101,122		0
1997		91,603		91,603		0
1998		102,135		102,135		0
1999		16,542		16,542		0
2000		41,974		41,974		0
2001		44,297		44,297		0
2002		105,037		105,037		0
2003		63,828		63,828		0
2004		31,885		31,885		0
2005		74,964		74,964		0
2006		23,431		23,431		0
2007		43,449		37,568		5,881
2008		38,784		26,988		11,796
2009		45,013		16,587		28,426
2010		64,245		0		64,245
Total		2,019,225		1,908,877		110,348

Milliman

WSC Direct Business
Exhibit J17

WESTERN SURETY COMPANY — DIRECT BUSINESS
NET TAX PREPARERS’ E&O
GROSS OF SALVAGE AND SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid Loss
	Ultimate Loss		Incurred Loss		Paid Loss &		Case		IBNR		& ALAE
Report Year	& ALAE		& ALAE		ALAE		Outstanding		@9/30/10		@9/30/10
1989		264,646		264,646		264,646		0		0		0
1990		493,181		493,181		493,181		0		0		0
1991		603,051		603,051		603,051		0		0		0
1992		547,186		547,186		547,186		0		0		0
1993		494,822		494,822		494,822		0		0		0
1994		742,605		742,605		742,605		0		0		0
1995		463,184		463,184		463,184		0		0		0
1996		369,116		369,116		369,116		0		0		0
1997		337,778		337,778		337,778		0		0		0
1998		389,754		389,754		389,754		0		0		0
1999		151,962		151,962		151,962		0		0		0
2000		220,272		220,272		220,272		0		0		0
2001		381,411		381,411		381,411		0		0		0
2002		367,299		367,299		367,299		0		0		0
2003		205,496		205,496		205,496		0		0		0
2004		203,979		203,979		203,979		0		0		0
2005		272,204		272,204		272,204		0		0		0
2006		278,686		278,686		278,686		0		0		0
2007		333,380		327,499		300,107		27,392		5,881		33,273
2008		462,186		447,129		405,602		41,527		15,057		56,584
2009		423,848		368,431		275,850		92,581		55,417		147,998
2010		383,874		287,954		113,219		174,735		95,920		270,655
Total		8,389,920		8,217,645		7,881,410		336,235		172,275		508,510

Milliman

WSC Direct Business
Exhibit K1

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS CONTRACT SURETY*
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss**		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1989		8		8		1.000		0.0	%		0		8		8		8		8		0
1990		0		0		1.000		0.0	%		0		0		0		0		0		0
1991		0		0		1.000		0.0	%		0		0		0		0		0		0
1992		1		1		1.000		0.0	%		0		1		1		1		1		0
1993		20		20		1.000		0.0	%		0		20		20		20		20		0
1994		24		24		1.000		0.0	%		0		24		24		24		24		0
1995		19		19		1.000		0.0	%		0		19		19		19		19		0
1996		1,208		1,208		1.000		0.0	%		0		1,208		1,208		1,208		1,208		0
1997		1,728		1,728		1.000		0.0	%		0		1,728		1,728		1,728		1,728		0
1998		2,723		2,723		1.000		0.0	%		0		2,723		2,723		2,723		2,723		0
1999		8,066		8,066		1.000		0.0	%		0		8,066		8,066		8,066		8,066		0
2000		5,063		5,063		1.000		0.0	%		0		5,063		5,063		5,063		5,063		0
2001		11,632		11,632		1.000		0.0	%		0		11,632		11,632		11,632		11,632		0
2002		10,951		10,951		1.000		0.0	%		0		10,951		10,951		10,951		10,951		0
2003		27,958		27,170		0.972		2.1	%		587		27,171		27,758		27,758		27,144		614
2004		44,917		43,864		0.977		2.5	%		1,123		43,586		44,709		44,709		40,174		4,535
2005		40,069		38,677		0.965		3.2	%		1,282		38,677		39,959		39,959		34,596		5,363
2006		19,749		18,631		0.943		5.1	%		1,007		18,538		19,545		19,545		17,354		2,191
2007		31,663		17,613		0.556		34.7	%		10,987		17,613		28,600		30,132		16,891		13,241
2008		43,925		17,961		0.409		55.4	%		24,334		17,880		42,214		43,925		15,715		28,210
2009		65,658		33,832		0.515		51.1	%		33,551		36,182		69,733		65,658		21,392		44,266
2010		56,337		10,553		0.187		73.1	%		41,182		14,176		55,358		56,337		11,968		44,369
Total		371,719		249,744							114,053		255,266		369,319		369,466		226,677		142,789

*	Excludes Constar in 2007.
**	The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit K2

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS CONTRACT SURETY*
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub**		Recovered		Recovery		Unrecovered			Projected		Recovered		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1989		8		8		1.000		0.0	%		0		8		8		8		0
1990		1		1		1.000		0.0	%		0		1		1		1		0
1991		0		0		1.000		0.0	%		0		0		0		0		0
1992		0		0		1.000		0.0	%		0		0		0		0		0
1993		19		19		1.000		0.0	%		0		19		19		19		0
1994		0		0		1.000		0.0	%		0		0		0		0		0
1995		9		9		1.000		0.0	%		0		9		9		9		0
1996		321		321		1.000		0.0	%		0		321		321		321		0
1997		577		577		1.000		0.0	%		0		577		577		577		0
1998		1,328		1,328		1.000		0.0	%		0		1,328		1,328		1,328		0
1999		3,098		3,098		1.000		0.0	%		0		3,098		3,098		3,098		0
2000		1,406		1,406		1.000		0.0	%		0		1,406		1,406		1,406		0
2001		2,705		2,705		1.000		0.0	%		0		2,710		2,710		2,710		0
2002		2,479		2,479		1.000		0.0	%		0		2,487		2,487		2,487		0
2003		10,360		9,981		0.963		2.7	%		280		9,996		10,276		10,276		280
2004		15,115		14,060		0.930		6.1	%		922		14,316		15,238		15,238		922
2005		14,560		13,450		0.924		7.5	%		1,092		13,688		14,780		14,780		1,092
2006		8,960		7,598		0.848		13.3	%		1,192		7,771		8,963		8,963		1,192
2007		6,644		3,746		0.564		36.5	%		2,425		3,987		6,412		6,528		2,541
2008		12,346		4,707		0.381		57.3	%		7,074		4,810		11,884		12,346		7,536
2009		14,611		1,521		0.104		82.7	%		12,083		2,467		14,550		14,611		12,144
2010		13,408		1,831		0.137		87.2	%		11,692		2,400		14,092		13,408		11,008
Total		107,955		68,845							36,760		71,399		108,159		108,114		36,715

*	Excludes Constar in 2007.
**	The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit K3

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS CONTRACT SURETY*
UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate			Paid Loss			Unpaid
	Loss, Gross		Salvage &		Loss, Net			Net of			Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub			Sal/Sub			of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10			@12/31/10			@12/31/10
1989		8		8		0			0			0
1990		0		1		(1	)		(1	)		0
1991		0		0		0			0			0
1992		1		0		1			1			0
1993		20		19		1			1			0
1994		24		0		24			24			0
1995		19		9		10			10			0
1996		1,208		321		887			887			0
1997		1,728		577		1,151			1,151			0
1998		2,723		1,328		1,395			1,395			0
1999		8,066		3,098		4,968			4,968			0
2000		5,063		1,406		3,657			3,657			0
2001		11,632		2,710		8,922			8,922			0
2002		10,951		2,487		8,464			8,464			0
2003		27,758		10,276		17,482			17,148			334
2004		44,709		15,238		29,471			25,858			3,613
2005		39,959		14,780		25,179			20,908			4,271
2006		19,545		8,963		10,582			9,583			999
2007		30,132		6,528		23,604			12,904			10,700
2008		43,925		12,346		31,579			10,905			20,674
2009		65,658		14,611		51,047			18,925			32,122
2010		56,337		13,408		42,929			9,568			33,361
Total		369,466		108,114		261,352			155,278			106,074

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit K4

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS CONTRACT SURETY
PAID ALAE B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1989		3		3		1.000		0.0	%		0		3		3		3		0
1990		0		0		1.000		0.0	%		0		0		0		0		0
1991		0		0		1.000		0.0	%		0		0		0		0		0
1992		0		0		1.000		0.0	%		0		0		0		0		0
1993		0		0		1.000		0.0	%		0		0		0		0		0
1994		4		4		1.000		0.0	%		0		4		4		4		0
1995		27		27		1.000		0.0	%		0		27		27		27		0
1996		498		498		1.000		0.0	%		0		498		498		498		0
1997		311		311		1.000		0.0	%		0		311		311		311		0
1998		396		396		1.000		0.0	%		0		396		396		396		0
1999		1,158		1,158		1.000		0.0	%		0		1,158		1,158		1,158		0
2000		688		688		1.000		0.0	%		0		688		688		688		0
2001		1,031		1,031		1.000		0.0	%		0		1,031		1,031		1,031		0
2002		1,116		1,116		1.000		0.0	%		0		1,119		1,119		1,119		0
2003		2,430		2,111		0.869		9.8	%		238		2,184		2,422		2,422		238
2004		2,870		2,215		0.772		20.4	%		585		2,439		3,024		3,024		585
2005		3,349		2,409		0.719		26.8	%		898		2,454		3,352		3,352		898
2006		1,631		1,048		0.643		33.8	%		551		1,137		1,688		1,688		551
2007		3,393		1,532		0.452		50.1	%		1,700		1,568		3,268		3,331		1,763
2008		2,566		578		0.225		71.8	%		1,842		666		2,508		2,566		1,900
2009		4,139		394		0.095		87.2	%		3,609		552		4,161		4,139		3,587
2010		4,225		102		0.024		95.8	%		4,047		254		4,301		4,225		3,971
Total		29,835		15,621							13,470		16,489		29,959		29,982		13,493

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit K5

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS CONTRACT SURETY*
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate								Paid			Unpaid		IBNR
	Loss &		Ultimate		Loss &			Paid Loss					Loss &			Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net			Net of					ALAE, Net			ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub			Sal/Sub			Paid ALAE		of Sal/Sub			of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10			@12/31/10			@12/31/10		@12/31/10			@12/31/10		@12/31/10
1989		11		8		3			0			3		3			0		0
1990		0		1		(1	)		(1	)		0		(1	)		0		0
1991		0		0		0			0			0		0			0		0
1992		1		0		1			1			0		1			0		0
1993		20		19		1			1			0		1			0		0
1994		28		0		28			24			4		28			0		0
1995		46		9		37			10			27		37			0		0
1996		1,706		321		1,385			887			498		1,385			0		0
1997		2,039		577		1,462			1,151			311		1,462			0		0
1998		3,119		1,328		1,791			1,395			396		1,791			0		0
1999		9,224		3,098		6,126			4,968			1,158		6,126			0		0
2000		5,751		1,406		4,345			3,657			688		4,345			0		0
2001		12,663		2,710		9,953			8,922			1,031		9,953			0		0
2002		12,070		2,487		9,583			8,464			1,119		9,583			0		0
2003		30,180		10,276		19,904			17,148			2,184		19,332			572		545
2004		47,733		15,238		32,495			25,858			2,439		28,297			4,198		786
2005		43,311		14,780		28,531			20,908			2,454		23,362			5,169		1,088
2006		21,233		8,963		12,270			9,583			1,137		10,720			1,550		366
2007		33,463		6,528		26,935			12,904			1,568		14,472			12,463		11,741
2008		46,491		12,346		34,145			10,905			666		11,571			22,574		20,409
2009		69,797		14,611		55,186			18,925			552		19,477			35,709		20,919
2010		60,562		13,408		47,154			9,568			254		9,822			37,332		35,124
Total		399,448		108,114		291,334			155,278			16,489		171,767			119,567		90,978

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit L1

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET CONTRACT SURETY*
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss**		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1989		8		8		1.000		0.0	%		0		8		8		8		8		0
1990		0		0		1.000		0.0	%		0		0		0		0		0		0
1991		0		0		1.000		0.0	%		0		0		0		0		0		0
1992		1		1		1.000		0.0	%		0		1		1		1		1		0
1993		10		10		1.000		0.0	%		0		10		10		10		10		0
1994		24		24		1.000		0.0	%		0		24		24		24		24		0
1995		7		7		1.000		0.0	%		0		7		7		7		7		0
1996		2		2		1.000		0.0	%		0		2		2		2		2		0
1997		3		3		1.000		0.0	%		0		3		3		3		3		0
1998		5		5		1.000		0.0	%		0		5		5		5		5		0
1999		44		44		1.000		0.0	%		0		44		44		44		44		0
2000		1,788		1,788		1.000		0.0	%		0		1,788		1,788		1,788		1,788		0
2001		9,991		9,991		1.000		0.0	%		0		9,991		9,991		9,991		9,991		0
2002		9,152		9,152		1.000		0.0	%		0		9,152		9,152		9,152		9,152		0
2003		26,868		26,102		0.971		2.1	%		564		26,103		26,667		26,667		26,095		572
2004		35,940		34,943		0.972		2.8	%		1,006		34,664		35,670		35,670		34,430		1,240
2005		34,331		33,138		0.965		3.3	%		1,133		33,251		34,384		34,384		31,753		2,631
2006		18,093		17,069		0.943		5.1	%		923		16,976		17,899		17,899		15,829		2,070
2007		28,639		17,420		0.608		30.8	%		8,821		17,420		26,241		27,440		16,699		10,741
2008		39,554		17,356		0.439		51.9	%		20,529		17,276		37,805		39,554		15,140		24,414
2009		62,558		33,832		0.541		48.5	%		30,341		36,182		66,523		62,558		21,392		41,166
2010		52,542		10,553		0.201		71.4	%		37,515		14,176		51,691		52,542		11,968		40,574
Total		319,560		211,448							100,832		217,083		317,915		317,749		194,341		123,408

*	Excludes Constar in 2007.
**	The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit L2

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET CONTRACT SURETY*
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub**		Recovered		Recovery		Unrecovered			Projected		Recovered		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1989		8		8		1.000		0.0	%		0		8		8		8		0
1990		1		1		1.000		0.0	%		0		1		1		1		0
1991		0		0		1.000		0.0	%		0		0		0		0		0
1992		0		0		1.000		0.0	%		0		0		0		0		0
1993		9		9		1.000		0.0	%		0		9		9		9		0
1994		0		0		1.000		0.0	%		0		0		0		0		0
1995		3		3		1.000		0.0	%		0		3		3		3		0
1996		0		0		1.000		0.0	%		0		0		0		0		0
1997		0		0		1.000		0.0	%		0		0		0		0		0
1998		0		0		1.000		0.0	%		0		0		0		0		0
1999		0		0		1.000		0.0	%		0		0		0		0		0
2000		745		745		1.000		0.0	%		0		745		745		745		0
2001		2,318		2,318		1.000		0.0	%		0		2,323		2,323		2,323		0
2002		2,224		2,224		1.000		0.0	%		0		2,232		2,232		2,232		0
2003		10,095		9,725		0.963		2.7	%		273		9,740		10,013		10,013		273
2004		13,897		12,927		0.930		6.2	%		862		13,183		14,045		14,045		862
2005		14,327		13,235		0.924		7.5	%		1,075		13,472		14,547		14,547		1,075
2006		8,150		6,902		0.847		13.4	%		1,092		7,075		8,167		8,167		1,092
2007		6,465		3,745		0.579		35.4	%		2,289		3,986		6,275		6,370		2,384
2008		10,979		4,158		0.379		57.1	%		6,269		4,261		10,530		10,979		6,718
2009		14,078		1,521		0.108		82.4	%		11,600		2,467		14,067		14,078		11,611
2010		12,663		1,831		0.145		86.5	%		10,954		2,400		13,354		12,663		10,263
Total		95,962		59,352							34,414		61,905		96,319		96,183		34,278

*	Excludes Constar in 2007.
**	The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit L3

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET CONTRACT SURETY*
UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate			Paid Loss			Unpaid
	Loss, Gross		Salvage &		Loss, Net			Net of			Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub			Sal/Sub			of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10			@12/31/10			@12/31/10
1989		8		8		0			0			0
1990		0		1		(1	)		(1	)		0
1991		0		0		0			0			0
1992		1		0		1			1			0
1993		10		9		1			1			0
1994		24		0		24			24			0
1995		7		3		4			4			0
1996		2		0		2			2			0
1997		3		0		3			3			0
1998		5		0		5			5			0
1999		44		0		44			44			0
2000		1,788		745		1,043			1,043			0
2001		9,991		2,323		7,668			7,668			0
2002		9,152		2,232		6,920			6,920			0
2003		26,667		10,013		16,654			16,355			299
2004		35,670		14,045		21,625			21,247			378
2005		34,384		14,547		19,837			18,281			1,556
2006		17,899		8,167		9,732			8,754			978
2007		27,440		6,370		21,070			12,713			8,357
2008		39,554		10,979		28,575			10,879			17,696
2009		62,558		14,078		48,480			18,925			29,555
2010		52,542		12,663		39,879			9,568			30,311
Total		317,749		96,183		221,566			132,436			89,130

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit L4

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET CONTRACT SURETY
PAID ALAE B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1989		3		3		1.000		0.0	%		0		3		3		3		0
1990		0		0		1.000		0.0	%		0		0		0		0		0
1991		0		0		1.000		0.0	%		0		0		0		0		0
1992		0		0		1.000		0.0	%		0		0		0		0		0
1993		0		0		1.000		0.0	%		0		0		0		0		0
1994		1		1		1.000		0.0	%		0		1		1		1		0
1995		1		1		1.000		0.0	%		0		1		1		1		0
1996		6		6		1.000		0.0	%		0		6		6		6		0
1997		0		0		1.000		0.0	%		0		0		0		0		0
1998		0		0		1.000		0.0	%		0		0		0		0		0
1999		6		6		1.000		0.0	%		0		6		6		6		0
2000		367		367		1.000		0.0	%		0		367		367		367		0
2001		629		629		1.000		0.0	%		0		629		629		629		0
2002		1,023		1,023		1.000		0.0	%		0		1,026		1,026		1,026		0
2003		2,328		2,015		0.866		10.1	%		235		2,088		2,323		2,323		235
2004		2,375		1,899		0.800		18.4	%		437		2,124		2,561		2,561		437
2005		3,005		2,239		0.745		24.1	%		724		2,281		3,005		3,005		724
2006		1,509		967		0.641		33.3	%		502		1,055		1,557		1,557		502
2007		2,130		947		0.445		50.6	%		1,078		983		2,061		2,096		1,113
2008		2,428		576		0.237		71.1	%		1,726		664		2,390		2,428		1,764
2009		4,010		394		0.098		86.7	%		3,477		552		4,029		4,010		3,458
2010		3,731		102		0.027		95.5	%		3,563		251		3,814		3,731		3,480
Total		23,552		11,175							11,742		12,037		23,779		23,750		11,713

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit L5

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET CONTRACT SURETY*
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate								Paid			Unpaid		IBNR
	Loss &		Ultimate		Loss &			Paid Loss					Loss &			Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net			Net of					ALAE, Net			ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub			Sal/Sub			Paid ALAE		of Sal/Sub			of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10			@12/31/10			@12/31/10		@12/31/10			@12/31/10		@12/31/10
1989		11		8		3			0			3		3			0		0
1990		0		1		(1	)		(1	)		0		(1	)		0		0
1991		0		0		0			0			0		0			0		0
1992		1		0		1			1			0		1			0		0
1993		10		9		1			1			0		1			0		0
1994		25		0		25			24			1		25			0		0
1995		8		3		5			4			1		5			0		0
1996		8		0		8			2			6		8			0		0
1997		3		0		3			3			0		3			0		0
1998		5		0		5			5			0		5			0		0
1999		50		0		50			44			6		50			0		0
2000		2,155		745		1,410			1,043			367		1,410			0		0
2001		10,620		2,323		8,297			7,668			629		8,297			0		0
2002		10,178		2,232		7,946			6,920			1,026		7,946			0		0
2003		28,990		10,013		18,977			16,355			2,088		18,443			534		526
2004		38,231		14,045		24,186			21,247			2,124		23,371			815		581
2005		37,389		14,547		22,842			18,281			2,281		20,562			2,280		782
2006		19,456		8,167		11,289			8,754			1,055		9,809			1,480		333
2007		29,536		6,370		23,166			12,713			983		13,696			9,470		8,749
2008		41,982		10,979		31,003			10,879			664		11,543			19,460		17,324
2009		66,568		14,078		52,490			18,925			552		19,477			33,013		18,223
2010		56,273		12,663		43,610			9,568			251		9,819			33,791		31,583
Total		341,499		96,183		245,316			132,436			12,037		144,473			100,843		78,101

* Excludes Constar in 2007.

Milliman

WSC Direct Business
Exhibit M1

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS COMMERCIAL SURETY
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1989		5,907		5,907		1.000		0.0	%		0		5,907		5,907		5,907		5,907		0
1990		6,809		6,809		1.000		0.0	%		0		6,809		6,809		6,809		6,809		0
1991		5,029		5,029		1.000		0.0	%		0		5,029		5,029		5,029		5,029		0
1992		4,921		4,921		1.000		0.0	%		0		4,921		4,921		4,921		4,921		0
1993		5,131		5,131		1.000		0.0	%		0		5,131		5,131		5,131		5,131		0
1994		3,999		3,999		1.000		0.0	%		0		3,999		3,999		3,999		3,999		0
1995		5,525		5,503		0.996		0.3	%		17		5,503		5,520		5,520		5,487		33
1996		5,982		5,946		0.994		0.6	%		36		5,908		5,944		5,944		5,908		36
1997		5,552		5,508		0.992		0.7	%		39		5,508		5,547		5,547		5,508		39
1998		7,369		7,251		0.984		1.4	%		103		7,250		7,353		7,353		7,250		103
1999		9,163		8,958		0.978		2.1	%		192		8,958		9,150		9,150		8,956		194
2000		9,038		8,850		0.979		2.1	%		190		8,864		9,054		9,054		8,824		230
2001		12,603		12,356		0.980		2.0	%		252		12,357		12,609		12,609		11,855		754
2002		10,364		9,931		0.958		3.6	%		373		9,930		10,303		10,303		9,916		387
2003		10,834		10,245		0.946		5.1	%		553		10,264		10,817		10,817		10,242		575
2004		12,073		11,348		0.940		5.9	%		712		11,357		12,069		12,069		10,887		1,182
2005		13,382		12,210		0.912		8.1	%		1,084		12,354		13,438		13,438		11,918		1,520
2006		17,582		16,173		0.920		8.2	%		1,442		16,314		17,756		17,756		14,091		3,665
2007		17,924		14,468		0.807		16.5	%		2,957		14,729		17,686		17,805		13,909		3,896
2008		29,782		23,449		0.787		20.8	%		6,195		24,522		30,717		30,250		20,077		10,173
2009		19,507		10,214		0.524		41.0	%		7,998		11,233		19,231		19,369		9,678		9,691
2010		19,941		2,371		0.119		78.0	%		15,554		3,945		19,499		19,941		2,304		17,637
Total		238,417		196,577							37,697		200,792		238,489		238,721		188,606		50,115

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit M2

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS COMMERCIAL SURETY
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub*		Recovered		Recovery		Unrecovered			Projected		Recovered		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1989		1,310		1,310		1.000		0.0	%		0		1,310		1,310		1,310		0
1990		1,164		1,164		1.000		0.0	%		0		1,166		1,166		1,166		0
1991		1,069		1,069		1.000		0.0	%		0		1,069		1,069		1,069		0
1992		899		899		1.000		0.0	%		0		900		900		900		0
1993		1,289		1,289		1.000		0.0	%		0		1,290		1,290		1,290		0
1994		956		956		1.000		0.0	%		0		956		956		956		0
1995		1,291		1,291		1.000		0.0	%		0		1,294		1,294		1,294		0
1996		1,247		1,247		1.000		0.0	%		0		1,248		1,248		1,248		0
1997		1,265		1,227		0.970		2.3	%		29		1,228		1,257		1,257		29
1998		1,811		1,736		0.959		3.9	%		71		1,736		1,807		1,807		71
1999		1,579		1,490		0.944		5.3	%		84		1,495		1,579		1,579		84
2000		1,720		1,597		0.928		6.8	%		117		1,604		1,721		1,721		117
2001		2,425		2,211		0.912		8.4	%		204		2,213		2,417		2,417		204
2002		2,043		1,803		0.883		11.0	%		225		1,810		2,035		2,035		225
2003		2,519		2,148		0.853		14.0	%		353		2,156		2,509		2,509		353
2004		2,160		1,723		0.798		18.9	%		408		1,787		2,195		2,195		408
2005		2,182		1,603		0.735		25.0	%		546		1,637		2,183		2,183		546
2006		3,144		1,991		0.633		34.1	%		1,072		2,100		3,172		3,172		1,072
2007		2,856		1,344		0.471		48.9	%		1,397		1,440		2,837		2,847		1,407
2008		6,101		2,525		0.414		57.2	%		3,490		2,975		6,465		6,283		3,308
2009		3,549		606		0.171		76.8	%		2,726		854		3,580		3,565		2,711
2010		3,709		214		0.058		91.4	%		3,390		226		3,616		3,709		3,483
Total		46,288		31,443							14,112		32,494		46,606		46,512		14,018

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit M3

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS COMMERCIAL SURETY
UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate		Paid Loss		Unpaid
	Loss, Gross		Salvage &		Loss, Net		Net of		Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		5,907		1,310		4,597		4,597		0
1990		6,809		1,166		5,643		5,643		0
1991		5,029		1,069		3,960		3,960		0
1992		4,921		900		4,021		4,021		0
1993		5,131		1,290		3,841		3,841		0
1994		3,999		956		3,043		3,043		0
1995		5,520		1,294		4,226		4,193		33
1996		5,944		1,248		4,696		4,660		36
1997		5,547		1,257		4,290		4,280		10
1998		7,353		1,807		5,546		5,514		32
1999		9,150		1,579		7,571		7,461		110
2000		9,054		1,721		7,333		7,220		113
2001		12,609		2,417		10,192		9,642		550
2002		10,303		2,035		8,268		8,106		162
2003		10,817		2,509		8,308		8,086		222
2004		12,069		2,195		9,874		9,100		774
2005		13,438		2,183		11,255		10,281		974
2006		17,756		3,172		14,584		11,991		2,593
2007		17,805		2,847		14,958		12,469		2,489
2008		30,250		6,283		23,967		17,102		6,865
2009		19,369		3,565		15,804		8,824		6,980
2010		19,941		3,709		16,232		2,078		14,154
Total		238,721		46,512		192,209		156,112		36,097

Milliman

WSC Direct Business
Exhibit M4

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS COMMERCIAL SURETY
PAID ALAE B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1989		1,290		1,290		1.000		0.0	%		0		1,290		1,290		1,290		0
1990		1,396		1,396		1.000		0.0	%		0		1,396		1,396		1,396		0
1991		898		898		1.000		0.0	%		0		898		898		898		0
1992		1,031		1,031		1.000		0.0	%		0		1,031		1,031		1,031		0
1993		983		983		1.000		0.0	%		0		983		983		983		0
1994		664		664		1.000		0.0	%		0		666		666		666		0
1995		977		971		0.994		0.5	%		5		971		976		976		5
1996		1,051		1,041		0.990		0.9	%		9		1,043		1,052		1,052		9
1997		1,181		1,174		0.994		0.7	%		8		1,174		1,182		1,182		8
1998		1,449		1,432		0.988		1.0	%		14		1,433		1,447		1,447		14
1999		2,178		2,147		0.986		1.4	%		30		2,151		2,181		2,181		30
2000		1,544		1,492		0.966		2.9	%		45		1,497		1,542		1,542		45
2001		2,478		2,332		0.941		5.3	%		131		2,369		2,500		2,500		131
2002		1,475		1,360		0.922		7.3	%		108		1,362		1,470		1,470		108
2003		1,679		1,486		0.885		10.6	%		178		1,497		1,675		1,675		178
2004		1,621		1,355		0.836		15.2	%		246		1,363		1,609		1,609		246
2005		2,114		1,670		0.790		19.9	%		421		1,731		2,152		2,152		421
2006		3,461		2,437		0.704		27.4	%		948		2,540		3,488		3,488		948
2007		2,962		1,756		0.593		37.9	%		1,123		1,854		2,977		2,970		1,116
2008		4,194		1,758		0.419		53.7	%		2,252		1,967		4,219		4,207		2,240
2009		3,948		794		0.201		74.4	%		2,937		986		3,923		3,936		2,950
2010		3,291		93		0.028		92.9	%		3,057		200		3,257		3,291		3,091
Total		41,865		29,560							11,512		30,402		41,914		41,942		11,540

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit M5

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS COMMERCIAL SURETY
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate						Paid		Unpaid		IBNR
	Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		7,197		1,310		5,887		4,597		1,290		5,887		0		0
1990		8,205		1,166		7,039		5,643		1,396		7,039		0		0
1991		5,927		1,069		4,858		3,960		898		4,858		0		0
1992		5,952		900		5,052		4,021		1,031		5,052		0		0
1993		6,114		1,290		4,824		3,841		983		4,824		0		0
1994		4,665		956		3,709		3,043		666		3,709		0		0
1995		6,496		1,294		5,202		4,193		971		5,164		38		22
1996		6,996		1,248		5,748		4,660		1,043		5,703		45		45
1997		6,729		1,257		5,472		4,280		1,174		5,454		18		18
1998		8,800		1,807		6,993		5,514		1,433		6,947		46		46
1999		11,331		1,579		9,752		7,461		2,151		9,612		140		138
2000		10,596		1,721		8,875		7,220		1,497		8,717		158		118
2001		15,109		2,417		12,692		9,642		2,369		12,011		681		179
2002		11,773		2,035		9,738		8,106		1,362		9,468		270		256
2003		12,492		2,509		9,983		8,086		1,497		9,583		400		378
2004		13,678		2,195		11,483		9,100		1,363		10,463		1,020		550
2005		15,590		2,183		13,407		10,281		1,731		12,012		1,395		959
2006		21,244		3,172		18,072		11,991		2,540		14,531		3,541		1,318
2007		20,775		2,847		17,928		12,469		1,854		14,323		3,605		2,785
2008		34,457		6,283		28,174		17,102		1,967		19,069		9,105		4,660
2009		23,305		3,565		19,740		8,824		986		9,810		9,930		8,375
2010		23,232		3,709		19,523		2,078		200		2,278		17,245		15,604
Total		280,663		46,512		234,151		156,112		30,402		186,514		47,637		35,451

Milliman

WSC Direct Business
Exhibit M6

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET COMMERCIAL SURETY
UNPAID LOSS & ALAE
NET OF QUOTA SHARE TREATIES, NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate						Paid		Unpaid		IBNR
	Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		6,889		1,257		5,632		4,438		1,194		5,632		0		0
1990		7,621		1,090		6,531		5,253		1,278		6,531		0		0
1991		5,534		1,036		4,498		3,660		838		4,498		0		0
1992		5,549		846		4,703		3,728		975		4,703		0		0
1993		5,575		1,258		4,317		3,386		931		4,317		0		0
1994		4,251		946		3,305		2,692		613		3,305		0		0
1995		6,338		1,188		5,150		4,164		948		5,112		38		22
1996		6,535		1,210		5,325		4,290		990		5,280		45		45
1997		6,434		1,010		5,424		4,247		1,159		5,406		18		18
1998		8,601		1,759		6,842		5,368		1,428		6,796		46		46
1999		11,209		1,517		9,692		7,408		2,144		9,552		140		138
2000		10,533		1,696		8,837		7,199		1,480		8,679		158		118
2001		15,069		2,411		12,658		9,617		2,360		11,977		681		179
2002		11,302		1,964		9,338		7,767		1,302		9,069		269		256
2003		11,840		2,430		9,410		7,598		1,413		9,011		399		378
2004		12,942		2,104		10,838		8,563		1,282		9,845		993		550
2005		15,135		2,125		13,010		9,965		1,669		11,634		1,376		959
2006		21,168		3,165		18,003		11,938		2,525		14,463		3,540		1,318
2007		20,751		2,847		17,904		12,453		1,848		14,301		3,603		2,785
2008		34,449		6,284		28,165		17,094		1,967		19,061		9,104		4,660
2009		23,305		3,565		19,740		8,824		986		9,810		9,930		8,375
2010		23,229		3,709		19,520		2,078		201		2,279		17,241		15,604
Total		274,259		45,417		228,842		151,730		29,531		181,261		47,581		35,451

Milliman

WSC Direct Business
Exhibit N1

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS FIDELITY
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1989		1,096		1,096		1.000		0.0	%		0		1,096		1,096		1,096		1,096		0
1990		1,235		1,235		1.000		0.0	%		0		1,235		1,235		1,235		1,235		0
1991		1,090		1,090		1.000		0.0	%		0		1,090		1,090		1,090		1,090		0
1992		1,226		1,226		1.000		0.0	%		0		1,226		1,226		1,226		1,226		0
1993		1,504		1,504		1.000		0.0	%		0		1,504		1,504		1,504		1,504		0
1994		1,533		1,533		1.000		0.0	%		0		1,533		1,533		1,533		1,533		0
1995		1,637		1,637		1.000		0.0	%		0		1,637		1,637		1,637		1,637		0
1996		1,479		1,479		1.000		0.0	%		0		1,479		1,479		1,479		1,479		0
1997		1,745		1,745		1.000		0.0	%		0		1,745		1,745		1,745		1,745		0
1998		949		949		1.000		0.0	%		0		949		949		949		934		15
1999		1,112		1,112		1.000		0.0	%		0		1,112		1,112		1,112		1,112		0
2000		838		838		1.000		0.0	%		0		838		838		838		838		0
2001		1,902		1,902		1.000		0.0	%		0		1,902		1,902		1,902		1,852		50
2002		1,289		1,289		1.000		0.0	%		0		1,289		1,289		1,289		1,289		0
2003		1,661		1,661		1.000		0.0	%		0		1,661		1,661		1,661		1,661		0
2004		1,683		1,652		0.982		1.4	%		24		1,660		1,684		1,684		1,652		32
2005		2,163		2,094		0.968		2.9	%		63		2,089		2,152		2,152		1,962		190
2006		1,755		1,649		0.940		5.3	%		93		1,603		1,696		1,696		1,559		137
2007		2,201		1,967		0.894		9.5	%		209		1,924		2,133		2,133		1,597		536
2008		1,599		1,168		0.730		22.9	%		366		1,248		1,614		1,607		1,007		600
2009		2,427		1,489		0.614		35.7	%		866		1,481		2,347		2,387		913		1,474
2010		1,959		257		0.131		74.8	%		1,465		624		2,089		1,959		98		1,861
Total		34,083		30,572							3,086		30,925		34,011		33,914		29,019		4,895

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit N2

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS FIDELITY
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub*		Recovered		Recovery		Unrecovered			Projected		Recovered		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1989		206		206		1.000		0.0	%		0		206		206		206		0
1990		176		176		1.000		0.0	%		0		176		176		176		0
1991		259		259		1.000		0.0	%		0		259		259		259		0
1992		288		288		1.000		0.0	%		0		288		288		288		0
1993		262		262		1.000		0.0	%		0		262		262		262		0
1994		282		282		1.000		0.0	%		0		282		282		282		0
1995		339		339		1.000		0.0	%		0		339		339		339		0
1996		326		326		1.000		0.0	%		0		326		326		326		0
1997		223		223		1.000		0.0	%		0		223		223		223		0
1998		210		210		1.000		0.0	%		0		210		210		210		0
1999		117		117		1.000		0.0	%		0		119		119		119		0
2000		93		93		1.000		0.0	%		0		93		93		93		0
2001		220		220		1.000		0.0	%		0		221		221		221		0
2002		139		139		1.000		0.0	%		0		141		141		141		0
2003		131		131		1.000		0.0	%		0		133		133		133		0
2004		139		101		0.727		20.5	%		28		107		135		135		28
2005		197		122		0.619		35.4	%		70		130		200		200		70
2006		256		128		0.500		47.0	%		120		131		251		251		120
2007		242		70		0.289		65.8	%		159		72		231		231		159
2008		163		49		0.301		70.2	%		114		55		169		166		111
2009		248		5		0.020		91.0	%		226		5		231		240		235
2010		200		0		0.000		99.5	%		199		1		200		200		199
Total		4,716		3,746							916		3,779		4,695		4,701		922

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit N3

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS FIDELITY
UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate		Paid Loss		Unpaid
	Loss, Gross		Salvage &		Loss, Net		Net of		Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		1,096		206		890		890		0
1990		1,235		176		1,059		1,059		0
1991		1,090		259		831		831		0
1992		1,226		288		938		938		0
1993		1,504		262		1,242		1,242		0
1994		1,533		282		1,251		1,251		0
1995		1,637		339		1,298		1,298		0
1996		1,479		326		1,153		1,153		0
1997		1,745		223		1,522		1,522		0
1998		949		210		739		724		15
1999		1,112		119		993		993		0
2000		838		93		745		745		0
2001		1,902		221		1,681		1,631		50
2002		1,289		141		1,148		1,148		0
2003		1,661		133		1,528		1,528		0
2004		1,684		135		1,549		1,545		4
2005		2,152		200		1,952		1,832		120
2006		1,696		251		1,445		1,428		17
2007		2,133		231		1,902		1,525		377
2008		1,607		166		1,441		952		489
2009		2,387		240		2,147		908		1,239
2010		1,959		200		1,759		97		1,662
Total		33,914		4,701		29,213		25,240		3,973

Milliman

WSC Direct Business
Exhibit N4

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS FIDELITY
PAID ALAE B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1989		102		102		1.000		0.0	%		0		102		102		102		0
1990		145		145		1.000		0.0	%		0		145		145		145		0
1991		82		82		1.000		0.0	%		0		82		82		82		0
1992		113		113		1.000		0.0	%		0		113		113		113		0
1993		149		149		1.000		0.0	%		0		149		149		149		0
1994		237		237		1.000		0.0	%		0		237		237		237		0
1995		232		232		1.000		0.0	%		0		232		232		232		0
1996		197		197		1.000		0.0	%		0		197		197		197		0
1997		148		148		1.000		0.0	%		0		148		148		148		0
1998		44		43		0.977		1.7	%		1		43		44		44		1
1999		23		23		1.000		0.6	%		0		23		23		23		0
2000		6		6		1.000		0.0	%		0		6		6		6		0
2001		67		64		0.955		3.4	%		2		64		66		66		2
2002		22		22		1.000		1.1	%		0		22		22		22		0
2003		52		52		1.000		0.0	%		0		52		52		52		0
2004		30		25		0.833		12.5	%		4		25		29		29		4
2005		48		36		0.750		22.9	%		11		37		48		48		11
2006		26		16		0.615		35.1	%		9		16		25		25		9
2007		54		24		0.444		51.3	%		28		30		58		58		28
2008		74		23		0.311		65.6	%		49		28		77		76		48
2009		86		7		0.081		86.1	%		74		9		83		85		76
2010		55		1		0.018		96.6	%		53		1		54		55		54
Total		1,992		1,747							231		1,761		1,992		1,994		233

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit N5

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS FIDELITY
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate						Paid		Unpaid		IBNR
	Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		1,198		206		992		890		102		992		0		0
1990		1,380		176		1,204		1,059		145		1,204		0		0
1991		1,172		259		913		831		82		913		0		0
1992		1,339		288		1,051		938		113		1,051		0		0
1993		1,653		262		1,391		1,242		149		1,391		0		0
1994		1,770		282		1,488		1,251		237		1,488		0		0
1995		1,869		339		1,530		1,298		232		1,530		0		0
1996		1,676		326		1,350		1,153		197		1,350		0		0
1997		1,893		223		1,670		1,522		148		1,670		0		0
1998		993		210		783		724		43		767		16		1
1999		1,135		119		1,016		993		23		1,016		0		0
2000		844		93		751		745		6		751		0		0
2001		1,968		221		1,747		1,631		64		1,695		52		2
2002		1,311		141		1,170		1,148		22		1,170		0		0
2003		1,713		133		1,580		1,528		52		1,580		0		0
2004		1,713		135		1,578		1,545		25		1,570		8		0
2005		2,200		200		2,000		1,832		37		1,869		131		4
2006		1,721		251		1,470		1,428		16		1,444		26		(18	)
2007		2,191		231		1,960		1,525		30		1,555		405		78
2008		1,683		166		1,517		952		28		980		537		296
2009		2,472		240		2,232		908		9		917		1,315		747
2010		2,014		200		1,814		97		1		98		1,716		1,190
Total		35,908		4,701		31,207		25,240		1,761		27,001		4,206		2,300

Milliman

WSC Direct Business
Exhibit N6

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET FIDELITY
UNPAID LOSS & ALAE
NET OF QUOTA SHARE TREATIES, NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate						Paid		Unpaid		IBNR
	Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		1,111		203		908		807		101		908		0		0
1990		1,384		176		1,208		1,062		146		1,208		0		0
1991		1,172		259		913		831		82		913		0		0
1992		1,339		288		1,051		938		113		1,051		0		0
1993		1,631		253		1,378		1,229		149		1,378		0		0
1994		1,760		278		1,482		1,245		237		1,482		0		0
1995		1,772		334		1,438		1,222		216		1,438		0		0
1996		1,442		327		1,115		925		190		1,115		0		0
1997		1,891		222		1,669		1,521		148		1,669		0		0
1998		993		211		782		723		43		766		16		1
1999		1,135		119		1,016		993		23		1,016		0		0
2000		844		93		751		745		6		751		0		0
2001		1,968		221		1,747		1,631		64		1,695		52		2
2002		1,255		136		1,119		1,098		21		1,119		0		0
2003		1,611		125		1,486		1,437		49		1,486		0		0
2004		1,611		129		1,482		1,451		23		1,474		8		0
2005		2,131		194		1,937		1,769		37		1,806		131		4
2006		1,721		251		1,470		1,428		16		1,444		26		(18	)
2007		2,191		231		1,960		1,525		30		1,555		405		78
2008		1,683		166		1,517		952		28		980		537		296
2009		2,472		240		2,232		908		9		917		1,315		747
2010		2,014		200		1,814		97		1		98		1,716		1,190
Total		35,131		4,656		30,475		24,537		1,732		26,269		4,206		2,300

Milliman

WSC Direct Business
Exhibit O1

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET NOTARY E&O
INCURRED LOSS B-F PROJECTION

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1989		116,570		116,570		1.000		0.0	%		0		116,570		116,570		116,570		116,570		0
1990		177,175		177,175		1.000		0.0	%		0		177,175		177,175		177,175		177,175		0
1991		21,914		21,914		1.000		0.0	%		0		21,914		21,914		21,914		21,914		0
1992		112,491		112,491		1.000		0.0	%		0		112,491		112,491		112,491		112,491		0
1993		67,404		67,404		1.000		0.0	%		0		67,404		67,404		67,404		67,404		0
1994		83,915		83,915		1.000		0.0	%		0		83,915		83,915		83,915		83,915		0
1995		309,295		309,295		1.000		0.0	%		0		309,295		309,295		309,295		309,295		0
1996		132,621		132,621		1.000		0.0	%		0		132,621		132,621		132,621		132,621		0
1997		130,000		130,000		1.000		0.0	%		0		130,000		130,000		130,000		130,000		0
1998		100,908		100,908		1.000		0.0	%		0		100,908		100,908		100,908		100,908		0
1999		106,500		106,500		1.000		0.0	%		0		106,500		106,500		106,500		106,500		0
2000		139,306		137,927		0.990		0.7	%		975		137,927		138,902		138,902		137,926		976
2001		186,051		183,301		0.985		1.4	%		2,605		183,300		185,905		185,905		183,300		2,605
2002		146,209		142,922		0.978		2.1	%		3,070		142,923		145,993		145,993		142,918		3,075
2003		147,024		141,915		0.965		3.2	%		4,705		141,913		146,618		146,618		141,912		4,706
2004		177,340		167,302		0.943		5.1	%		9,044		168,302		177,346		177,346		157,292		20,054
2005		169,092		150,975		0.893		9.5	%		16,064		155,958		172,022		172,022		140,938		31,084
2006		173,468		129,647		0.747		21.6	%		37,469		167,142		204,611		204,611		152,125		52,486
2007		299,132		174,931		0.585		37.5	%		112,175		174,935		287,110		287,110		157,413		129,697
2008		215,101		92,560		0.430		53.1	%		114,219		84,963		199,182		207,142		71,948		135,194
2009		146,501		27,922		0.191		74.9	%		109,729		22,920		132,649		139,575		18,910		120,665
2010		143,463		4		0.000		95.2	%		136,577		6		136,583		143,463		0		143,463
Total		3,301,480		2,708,199							546,632		2,739,082		3,285,714		3,307,480		2,663,475		644,005

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit O2

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET NOTARY E&O
PAID ALAE B-F PROJECTION

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1989		66,911		66,911		1.000		0.0	%		0		66,911		66,911		66,911		0
1990		131,223		131,223		1.000		0.0	%		0		131,223		131,223		131,223		0
1991		35,254		35,254		1.000		0.0	%		0		35,254		35,254		35,254		0
1992		129,309		129,309		1.000		0.0	%		0		129,309		129,309		129,309		0
1993		59,060		59,060		1.000		0.0	%		0		59,060		59,060		59,060		0
1994		128,511		128,511		1.000		0.0	%		0		128,511		128,511		128,511		0
1995		352,941		352,941		1.000		0.0	%		0		352,941		352,941		352,941		0
1996		98,377		98,377		1.000		0.0	%		0		98,377		98,377		98,377		0
1997		104,763		104,763		1.000		0.0	%		0		104,763		104,763		104,763		0
1998		116,770		116,770		1.000		0.0	%		0		116,770		116,770		116,770		0
1999		111,129		111,129		1.000		0.0	%		0		111,129		111,129		111,129		0
2000		203,034		199,759		0.984		1.2	%		2,436		200,092		202,528		202,528		2,436
2001		170,295		165,909		0.974		2.3	%		3,917		165,909		169,826		169,826		3,917
2002		193,619		185,955		0.960		3.6	%		6,970		186,820		193,790		193,790		6,970
2003		213,712		199,555		0.934		6.0	%		12,823		199,555		212,378		212,378		12,823
2004		273,348		232,333		0.850		12.9	%		35,262		235,666		270,928		270,928		35,262
2005		474,902		360,222		0.759		21.9	%		104,004		367,494		471,498		471,498		104,004
2006		386,722		231,532		0.599		36.1	%		139,607		251,978		391,585		391,585		139,607
2007		774,759		335,740		0.433		52.5	%		406,748		357,672		764,420		764,420		406,748
2008		340,201		79,496		0.234		71.6	%		243,584		85,878		329,462		334,832		248,954
2009		293,295		37,628		0.128		84.5	%		247,834		46,838		294,672		293,984		247,146
2010		287,212		0		0.000		96.8	%		278,021		1,351		279,372		287,212		285,861
Total		4,945,347		3,362,377							1,481,206		3,433,501		4,914,707		4,927,229		1,493,728

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit O3

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET NOTARY E&O
UNPAID LOSS & ALAE

	Ultimate								Unpaid		IBNR
	Loss &						Paid Loss		Loss &		Loss &
Accident	ALAE		Paid Loss		Paid ALAE		& ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		183,481		116,570		66,911		183,481		0		0
1990		308,398		177,175		131,223		308,398		0		0
1991		57,168		21,914		35,254		57,168		0		0
1992		241,800		112,491		129,309		241,800		0		0
1993		126,464		67,404		59,060		126,464		0		0
1994		212,426		83,915		128,511		212,426		0		0
1995		662,236		309,295		352,941		662,236		0		0
1996		230,998		132,621		98,377		230,998		0		0
1997		234,763		130,000		104,763		234,763		0		0
1998		217,678		100,908		116,770		217,678		0		0
1999		217,629		106,500		111,129		217,629		0		0
2000		341,430		137,926		200,092		338,018		3,412		3,411
2001		355,731		183,300		165,909		349,209		6,522		6,522
2002		339,783		142,918		186,820		329,738		10,045		10,040
2003		358,996		141,912		199,555		341,467		17,529		17,528
2004		448,274		157,292		235,666		392,958		55,316		44,306
2005		643,520		140,938		367,494		508,432		135,088		120,068
2006		596,196		152,125		251,978		404,103		192,093		177,076
2007		1,051,530		157,413		357,672		515,085		536,445		518,923
2008		541,974		71,948		85,878		157,826		384,148		371,133
2009		433,559		18,910		46,838		65,748		367,811		363,801
2010		430,675		0		1,351		1,351		429,324		429,318
Total		8,234,709		2,663,475		3,433,501		6,096,976		2,137,733		2,062,126

Milliman

WSC Direct Business
Exhibit P1

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET TAX PREPARERS’ E&O
INCURRED LOSS B-F PROJECTION

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1989		201,428		201,428		1.000		0.0	%		0		201,428		201,428		201,428		201,428		0
1990		374,943		374,943		1.000		0.0	%		0		374,943		374,943		374,943		374,943		0
1991		402,979		402,979		1.000		0.0	%		0		402,979		402,979		402,979		402,979		0
1992		400,458		400,458		1.000		0.0	%		0		400,458		400,458		400,458		400,458		0
1993		331,982		331,982		1.000		0.0	%		0		331,982		331,982		331,982		331,982		0
1994		427,040		427,040		1.000		0.0	%		0		427,040		427,040		427,040		427,040		0
1995		338,929		338,929		1.000		0.0	%		0		338,929		338,929		338,929		338,929		0
1996		267,994		267,994		1.000		0.0	%		0		267,994		267,994		267,994		267,994		0
1997		246,175		246,175		1.000		0.0	%		0		246,175		246,175		246,175		246,175		0
1998		287,619		287,619		1.000		0.0	%		0		287,619		287,619		287,619		287,619		0
1999		135,420		135,420		1.000		0.0	%		0		135,420		135,420		135,420		135,420		0
2000		178,298		178,298		1.000		0.0	%		0		178,298		178,298		178,298		178,298		0
2001		337,114		337,114		1.000		0.0	%		0		337,114		337,114		337,114		337,114		0
2002		262,262		262,262		1.000		0.0	%		0		262,262		262,262		262,262		262,262		0
2003		141,668		141,668		1.000		0.0	%		0		141,668		141,668		141,668		141,668		0
2004		172,094		172,094		1.000		0.0	%		0		172,094		172,094		172,094		172,094		0
2005		197,240		197,240		1.000		0.0	%		0		197,240		197,240		197,240		197,240		0
2006		255,255		255,255		1.000		0.0	%		0		255,255		255,255		255,255		255,255		0
2007		289,931		289,931		1.000		0.0	%		0		280,646		280,646		280,646		262,539		18,107
2008		423,402		420,141		0.992		0.6	%		2,540		406,402		408,942		408,942		378,614		30,328
2009		378,835		351,844		0.929		5.5	%		20,836		319,883		340,719		340,719		268,789		71,930
2010		431,032		287,954		0.668		26.7	%		115,086		346,001		461,087		461,087		227,425		233,662
Total		6,482,098		6,308,768							138,462		6,311,830		6,450,292		6,450,292		6,096,265		354,027

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit P2

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET TAX PREPARERS’ E&O
PAID ALAE B-F PROJECTION

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1989		63,218		63,218		1.000		0.0	%		0		63,218		63,218		63,218		0
1990		118,238		118,238		1.000		0.0	%		0		118,238		118,238		118,238		0
1991		200,072		200,072		1.000		0.0	%		0		200,072		200,072		200,072		0
1992		146,728		146,728		1.000		0.0	%		0		146,728		146,728		146,728		0
1993		162,840		162,840		1.000		0.0	%		0		162,840		162,840		162,840		0
1994		315,565		315,565		1.000		0.0	%		0		315,565		315,565		315,565		0
1995		124,255		124,255		1.000		0.0	%		0		124,255		124,255		124,255		0
1996		101,122		101,122		1.000		0.0	%		0		101,122		101,122		101,122		0
1997		91,603		91,603		1.000		0.0	%		0		91,603		91,603		91,603		0
1998		102,135		102,135		1.000		0.0	%		0		102,135		102,135		102,135		0
1999		16,542		16,542		1.000		0.0	%		0		16,542		16,542		16,542		0
2000		41,974		41,974		1.000		0.0	%		0		41,974		41,974		41,974		0
2001		44,297		44,297		1.000		0.0	%		0		44,297		44,297		44,297		0
2002		105,037		105,037		1.000		0.0	%		0		105,037		105,037		105,037		0
2003		63,828		63,828		1.000		0.0	%		0		63,828		63,828		63,828		0
2004		31,885		31,885		1.000		0.0	%		0		31,885		31,885		31,885		0
2005		74,964		74,964		1.000		0.0	%		0		74,964		74,964		74,964		0
2006		23,431		23,431		1.000		0.0	%		0		23,431		23,431		23,431		0
2007		43,449		37,568		0.865		10.2	%		4,432		37,568		42,000		42,000		4,432
2008		38,784		26,988		0.696		26.2	%		10,161		35,071		45,232		45,232		10,161
2009		45,013		16,587		0.368		55.0	%		24,757		20,501		45,258		45,258		24,757
2010		86,637		0		0.000		90.8	%		78,666		3,272		81,938		86,637		83,365
Total		2,041,617		1,908,877							118,016		1,924,146		2,042,162		2,046,861		122,715

* The 2010 year has been adjusted to a full year basis.

Milliman

WSC Direct Business
Exhibit P3

WESTERN SURETY COMPANY — DIRECT BUSINESS

NET TAX PREPARERS’ E&O
UNPAID LOSS & ALAE

	Ultimate								Unpaid		IBNR
	Loss &						Paid Loss		Loss &		Loss &
Accident	ALAE		Paid Loss		Paid ALAE		& ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		264,646		201,428		63,218		264,646		0		0
1990		493,181		374,943		118,238		493,181		0		0
1991		603,051		402,979		200,072		603,051		0		0
1992		547,186		400,458		146,728		547,186		0		0
1993		494,822		331,982		162,840		494,822		0		0
1994		742,605		427,040		315,565		742,605		0		0
1995		463,184		338,929		124,255		463,184		0		0
1996		369,116		267,994		101,122		369,116		0		0
1997		337,778		246,175		91,603		337,778		0		0
1998		389,754		287,619		102,135		389,754		0		0
1999		151,962		135,420		16,542		151,962		0		0
2000		220,272		178,298		41,974		220,272		0		0
2001		381,411		337,114		44,297		381,411		0		0
2002		367,299		262,262		105,037		367,299		0		0
2003		205,496		141,668		63,828		205,496		0		0
2004		203,979		172,094		31,885		203,979		0		0
2005		272,204		197,240		74,964		272,204		0		0
2006		278,686		255,255		23,431		278,686		0		0
2007		322,646		262,539		37,568		300,107		22,539		4,432
2008		454,174		378,614		35,071		413,685		40,489		12,701
2009		385,977		268,789		20,501		289,290		96,687		45,593
2010		547,724		227,425		3,272		230,697		317,027		198,451
Total		8,497,153		6,096,265		1,924,146		8,020,411		476,742		261,177

Milliman

WSC Direct Business
Exhibit Q1

WESTERN SURETY COMPANY

Direct & Assumed Calendar Year Payments
Schedule P — Part 1 — Summary

	(1)			(2)		(3)		(4)		(5)
						= (1) + (2)				= (4) / (3)
						Total				Paid ULAE
Calendar	Paid			Paid		Paid Loss		Paid		to Paid Loss
Year	Loss			ALAE		& ALAE		ULAE		& ALAE
2000		63,687			5,188		68,875		5,241		7.6	%
2001		78,611			6,686		85,297		5,363		6.3	%
2002		63,567			13,657		77,224		6,281		8.1	%
2003		126,168			11,343		137,511		7,079		5.1	%
2004		95,849			9,530		105,379		7,031		6.7	%
2005		97,534			9,232		106,766		7,396		6.9	%
2006		67,012			10,412		77,424		7,940		10.3	%
2007		62,983			10,039		73,022		6,954		9.5	%
2008		63,556	*		10,374		73,930		5,556		7.5	%
2009		79,897			10,936		90,833		6,137		6.8	%
Total		798,864			97,397		896,261		64,978		7.2	%
Weighted Avg 07-09											7.8	%
Weighted Avg 06-09											8.4	%
Weighted Avg 05-09											8.1	%
(6) Selected ULAE-to-Loss & ALAE Ratio											8.5	%

* Excludes the Superior National payment of $56.25M.

Milliman

WSC Direct Business
Exhibit Q2

WESTERN SURETY COMPANY — DIRECT BUSINESS

GROSS OF REINSURANCE
GROSS OF SALVAGE & SUBROGATION
DEVELOPMENT OF UNPAID ULAE ($000s)
EVALUATED AS OF DECEMBER 31, 2010

	(1)			(2)		(3)		(4)
								Selected
	Paid ULAE					Milliman		Unpaid
	to Paid Loss			Gross Case		Estimated		ULAE***
Gross Line of Business	& ALAE			Reserves		Gross IBNR*		@12/31/10
Contract Surety**		8.5	%		28,589		127,693		12,069
Commercial Surety		8.5	%		12,186		49,469		4,723
Fidelity		8.5	%		1,906		3,222		355
Notary E&O		8.5	%		76		2,062		179
Tax Preparers’ E&O		8.5	%		216		261		31
Total					42,973		182,707		17,357

*	IBNR from Exhibits K5, M5, N5, O3 & P3 plus the Sal/Sub Recoverable from Exhibits K2, M2 & N2
**	Excludes Constar in the 1997 year
***	(4) = (1) x (2) x 0.5 + (1) x (3)

Milliman

WESTERN SURETY COMPANY
ASSUMED BUSINESS

Milliman

WSC Assumed Business
Exhibit A1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
CONTRACT SURETY
EVALUATED AS OF 9/30/10

Accident	Reported Claim Counts*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		2,286		2,374		2,397		7,180		7,201		7,220		7,261		7,277		7,282		7,284		7,298		7,299		7,302		7,302		7,302		7,304		7,304		7,304		7,306		7,306		7,306		7,306		7,307		7,318
1988		26		64		318		331		352		367		371		374		380		384		385		387		387		387		388		389		389		389		389		389		389		389		389
1989		30		266		318		366		395		405		412		442		447		447		449		449		449		449		449		449		449		449		451		451		452		452
1990		120		318		462		530		565		582		614		621		624		627		629		630		630		631		631		631		632		632		632		632		632
1991		127		350		509		574		594		666		673		679		681		681		683		683		683		683		683		683		683		683		683		683
1992		115		386		524		576		690		709		714		716		716		716		716		719		719		719		719		719		719		719		720
1993		94		314		437		678		703		710		712		714		714		715		716		717		718		718		720		720		720		720
1994		91		267		691		741		755		760		764		765		766		767		767		767		767		767		767		767		767
1995		68		518		642		661		672		676		679		679		679		680		683		683		683		686		686		686
1996		153		428		492		504		516		520		524		525		526		527		527		527		528		529		530
1997		211		446		498		515		524		531		532		536		540		540		541		541		541		541
1998		328		563		624		644		659		667		668		672		672		672		672		673		673
1999		315		616		689		740		769		775		785		786		787		787		787		787
2000		315		614		795		857		882		892		899		901		901		902		902
2001		510		1,105		1,275		1,322		1,340		1,354		1,362		1,365		1,368		1,369
2002		460		911		1,095		1,149		1,166		1,180		1,185		1,186		1,187
2003		422		836		935		958		970		973		976		977
2004		232		478		542		570		586		591		594
2005		217		393		424		428		434		438
2006		198		313		325		335		342
2007		208		323		350		353
2008		276		408		422
2009		392		492
2010		220

* Last Diagonal is as of 9/30/10.

Accident	Reported Claim Counts Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.038		1.010		2.995		1.003		1.003		1.006		1.002		1.001		1.000		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.002
1988		2.462		4.969		1.041		1.063		1.043		1.011		1.008		1.016		1.011		1.003		1.005		1.000		1.000		1.003		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		8.867		1.195		1.151		1.079		1.025		1.017		1.073		1.011		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.004		1.000		1.002		1.000
1990		2.650		1.453		1.147		1.066		1.030		1.055		1.011		1.005		1.005		1.003		1.002		1.000		1.002		1.000		1.000		1.002		1.000		1.000		1.000		1.000
1991		2.756		1.454		1.128		1.035		1.121		1.011		1.009		1.003		1.000		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		3.357		1.358		1.099		1.198		1.028		1.007		1.003		1.000		1.000		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.002
1993		3.340		1.392		1.551		1.037		1.010		1.003		1.003		1.000		1.001		1.001		1.001		1.001		1.000		1.003		1.000		1.000		1.000
1994		2.934		2.588		1.072		1.019		1.007		1.005		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		7.618		1.239		1.030		1.017		1.006		1.004		1.000		1.000		1.001		1.004		1.000		1.000		1.004		1.000		1.000
1996		2.797		1.150		1.024		1.024		1.008		1.008		1.002		1.002		1.002		1.000		1.000		1.002		1.002		1.003
1997		2.114		1.117		1.034		1.017		1.013		1.002		1.008		1.007		1.000		1.002		1.000		1.000		1.000
1998		1.716		1.108		1.032		1.023		1.012		1.001		1.006		1.000		1.000		1.000		1.001		1.000
1999		1.956		1.119		1.074		1.039		1.008		1.013		1.001		1.001		1.000		1.000		1.000
2000		1.949		1.295		1.078		1.029		1.011		1.008		1.002		1.000		1.001		1.000
2001		2.167		1.154		1.037		1.014		1.010		1.006		1.002		1.002		1.001
2002		1.980		1.202		1.049		1.015		1.012		1.004		1.001		1.001
2003		1.981		1.118		1.025		1.013		1.003		1.003		1.001
2004		2.060		1.134		1.052		1.028		1.009		1.007
2005		1.811		1.079		1.009		1.014		1.012
2006		1.581		1.038		1.031		1.028
2007		1.553		1.084		1.011
2008		1.478		1.046
2009		1.354
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		2.675		1.423		1.175		1.038		1.020		1.009		1.008		1.003		1.002		1.002		1.001		1.000		1.001		1.001		1.000		1.000		1.000		1.001		1.000		1.001		1.000		1.000		1.002
Average x 87		2.749		1.442		1.084		1.040		1.020		1.010		1.008		1.003		1.002		1.002		1.001		1.000		1.001		1.001		1.000		1.000		1.000		1.001		1.000		1.001		1.000		1.000
Average x H/L		2.458		1.266		1.088		1.031		1.015		1.007		1.004		1.003		1.001		1.002		1.001		1.000		1.000		1.001		1.000		1.000		1.000		1.001		1.000		1.000		1.000
Avg L5 x H/L		1.537		1.069		1.022		1.019		1.010		1.006		1.002		1.001		1.000		1.000		1.000		1.000		1.001		1.001		1.000		1.000		1.000		1.001		1.000
Wtd Average		1.782		1.202		1.395		1.023		1.012		1.008		1.004		1.002		1.001		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.002
WA x 1987		2.129		1.248		1.074		1.035		1.018		1.009		1.006		1.002		1.001		1.001		1.001		1.000		1.001		1.001		1.000		1.000		1.000		1.001		1.000		1.001		1.000		1.000
Wtd Avg L5		1.524		1.080		1.027		1.018		1.009		1.005		1.002		1.001		1.001		1.000		1.000		1.000		1.001		1.001		1.000		1.000		1.000		1.001		1.000
Selected		1.524		1.080		1.027		1.018		1.009		1.005		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		1.762		1.156		1.070		1.042		1.024		1.015		1.010		1.008		1.006		1.005		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		2.055		1.284		1.091		1.049		1.029		1.017		1.011		1.009		1.007		1.005		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

     WSC Assumed Business
Exhibit A2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
CONTRACT SURETY
EVALUATED AS OF 9/30/10

Reported Claim Projection

																			Indicated
							Cumulative Reported						Indicated Ultimate						Ultimate
Accident	Reported Claim Counts						Development Factors						Reported Claims						Reported
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Claims
1987&Prior		7,306		7,307		7,318		1.000		1.000		1.000		7,306		7,307		7,318		7,318
1988		389		389		389		1.000		1.000		1.000		389		389		389		389
1989		451		452		452		1.000		1.000		1.000		451		452		452		452
1990		632		632		632		1.000		1.000		1.000		632		632		632		632
1991		683		683		683		1.000		1.000		1.000		683		683		683		683
1992		719		719		720		1.000		1.000		1.000		719		719		720		720
1993		720		720		720		1.000		1.000		1.000		720		720		720		720
1994		767		767		767		1.000		1.000		1.000		767		767		767		767
1995		686		686		686		1.001		1.000		1.000		687		686		686		686
1996		528		529		530		1.002		1.001		1.000		529		530		530		530
1997		541		541		541		1.003		1.002		1.001		543		542		542		542
1998		672		673		673		1.004		1.003		1.002		675		675		674		674
1999		787		787		787		1.005		1.004		1.003		791		790		789		789
2000		901		902		902		1.006		1.005		1.004		906		907		906		906
2001		1,365		1,368		1,369		1.008		1.006		1.005		1,376		1,376		1,376		1,376
2002		1,185		1,186		1,187		1.010		1.008		1.007		1,197		1,195		1,195		1,195
2003		973		976		977		1.015		1.010		1.009		988		986		986		986
2004		586		591		594		1.024		1.015		1.011		600		600		601		601
2005		428		434		438		1.042		1.024		1.017		446		444		445		445
2006		325		335		342		1.070		1.042		1.029		348		349		352		352
2007		323		350		353		1.156		1.070		1.049		373		375		370		370
2008		276		408		422		1.762		1.156		1.091		486		472		460		460
2009				392		492				1.762		1.284				691		632		632
2010						220						2.055						452		339

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit A3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
CONTRACT SURETY
EVALUATED AS OF 9/30/10

Accident	Closed Claim Counts*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		1,716		1,920		2,015		6,704		6,871		6,987		7,092		7,170		7,195		7,211		7,237		7,275		7,278		7,285		7,287		7,289		7,290		7,291		7,295		7,296		7,299		7,299		7,299		7,300
1988		0		6		205		245		292		312		339		352		359		365		373		374		380		382		382		384		384		384		384		384		384		389		389
1989		2		107		161		257		306		349		358		379		400		420		427		431		435		436		443		444		444		443		447		447		447		447
1990		18		96		188		320		410		461		509		526		565		581		598		606		612		622		624		624		629		630		630		632		632
1991		15		93		197		324		396		474		520		595		621		633		651		659		670		670		671		676		679		679		680		680
1992		11		82		195		298		418		513		596		633		658		671		686		703		703		709		711		718		718		719		719
1993		16		67		161		320		461		543		595		623		643		669		690		694		697		700		712		715		715		716
1994		12		57		269		441		556		618		663		677		701		732		740		746		755		762		762		764		765
1995		9		143		324		469		540		586		598		618		649		659		660		671		679		680		683		684
1996		18		143		291		376		437		469		483		503		507		510		515		518		519		521		522
1997		40		194		304		397		425		454		500		507		514		522		530		533		537		539
1998		69		217		376		439		502		581		597		610		636		651		652		658		658
1999		38		218		318		428		605		648		665		717		750		753		762		766
2000		47		170		328		518		612		660		752		830		842		870		878
2001		81		315		562		803		941		1,133		1,229		1,262		1,315		1,323
2002		76		229		410		588		830		1,023		1,073		1,120		1,129
2003		55		204		363		537		769		822		871		881
2004		28		108		203		383		438		490		503
2005		33		106		260		318		364		373
2006		25		112		175		270		281
2007		31		119		223		252
2008		33		141		198
2009		47		108
2010		24

* Last Diagonal is as of 9/30/10.

Accident	Closed Claim Counts Development Factors
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108-120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.119		1.049		3.327		1.025		1.017		1.015		1.011		1.003		1.002		1.004		1.005		1.000		1.001		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000
1988		N/A		34.167		1.195		1.192		1.068		1.087		1.038		1.020		1.017		1.022		1.003		1.016		1.005		1.000		1.005		1.000		1.000		1.000		1.000		1.000		1.013		1.000
1989		53.500		1.505		1.596		1.191		1.141		1.026		1.059		1.055		1.050		1.017		1.009		1.009		1.002		1.016		1.002		1.000		0.998		1.009		1.000		1.000		1.000
1990		5.333		1.958		1.702		1.281		1.124		1.104		1.033		1.074		1.028		1.029		1.013		1.010		1.016		1.003		1.000		1.008		1.002		1.000		1.003		1.000
1991		6.200		2.118		1.645		1.222		1.197		1.097		1.144		1.044		1.019		1.028		1.012		1.017		1.000		1.001		1.007		1.004		1.000		1.001		1.000
1992		7.455		2.378		1.528		1.403		1.227		1.162		1.062		1.039		1.020		1.022		1.025		1.000		1.009		1.003		1.010		1.000		1.001		1.000
1993		4.188		2.403		1.988		1.441		1.178		1.096		1.047		1.032		1.040		1.031		1.006		1.004		1.004		1.017		1.004		1.000		1.002
1994		4.750		4.719		1.639		1.261		1.112		1.073		1.021		1.035		1.044		1.011		1.008		1.012		1.009		1.000		1.003		1.002
1995		15.889		2.266		1.448		1.151		1.085		1.020		1.033		1.050		1.015		1.002		1.017		1.012		1.001		1.004		1.002
1996		7.944		2.035		1.292		1.162		1.073		1.030		1.041		1.008		1.006		1.010		1.006		1.002		1.004		1.003
1997		4.850		1.567		1.306		1.071		1.068		1.101		1.014		1.014		1.016		1.015		1.006		1.008		1.005
1998		3.145		1.733		1.168		1.144		1.157		1.028		1.022		1.043		1.024		1.002		1.009		1.000
1999		5.737		1.459		1.346		1.414		1.071		1.026		1.078		1.046		1.004		1.012		1.007
2000		3.617		1.929		1.579		1.181		1.078		1.139		1.104		1.014		1.033		1.012
2001		3.889		1.784		1.429		1.172		1.204		1.085		1.027		1.042		1.008
2002		3.013		1.790		1.434		1.412		1.233		1.049		1.044		1.011
2003		3.709		1.779		1.479		1.432		1.069		1.060		1.015
2004		3.857		1.880		1.887		1.144		1.119		1.036
2005		3.212		2.453		1.223		1.145		1.033
2006		4.480		1.563		1.543		1.055
2007		3.839		1.874		1.177
2008		4.273		1.573
2009		3.032
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		7.138		3.454		1.568		1.225		1.119		1.068		1.047		1.033		1.022		1.015		1.010		1.008		1.005		1.005		1.004		1.002		1.000		1.002		1.001		1.000		1.004		1.000		1.000
Average x 87		7.424		3.568		1.480		1.235		1.124		1.072		1.049		1.035		1.023		1.016		1.010		1.008		1.006		1.005		1.004		1.002		1.000		1.002		1.001		1.000		1.007		1.000
Average x H/L		5.121		2.038		1.497		1.224		1.118		1.066		1.043		1.032		1.021		1.015		1.009		1.007		1.005		1.004		1.003		1.001		1.001		1.001		1.000		1.000		1.000
Avg L5 x H/L		3.775		1.775		1.415		1.233		1.131		1.064		1.050		1.033		1.016		1.011		1.007		1.007		1.004		1.003		1.005		1.002		1.001		1.000		1.000
Wtd Average		2.062		1.599		1.952		1.140		1.082		1.048		1.032		1.021		1.013		1.010		1.008		1.004		1.003		1.002		1.002		1.001		1.000		1.001		1.000		1.000		1.001		1.000		1.000
WA x 1987		4.360		1.959		1.450		1.240		1.130		1.071		1.047		1.034		1.022		1.016		1.010		1.008		1.006		1.005		1.004		1.002		1.001		1.002		1.001		1.000		1.006		1.000
Wtd Avg L5		3.672		1.848		1.446		1.281		1.150		1.074		1.049		1.030		1.016		1.010		1.009		1.007		1.005		1.005		1.005		1.003		1.001		1.002		1.000
Selected		3.672		1.848		1.446		1.281		1.150		1.074		1.049		1.030		1.016		1.010		1.009		1.007		1.005		1.004		1.003		1.003		1.002		1.002		1.001		1.001		1.001		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		17.861		4.864		2.632		1.820		1.421		1.236		1.151		1.097		1.065		1.048		1.038		1.029		1.022		1.017		1.013		1.010		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		29.953		6.733		3.069		1.996		1.512		1.280		1.172		1.110		1.073		1.052		1.041		1.031		1.024		1.018		1.014		1.011		1.008		1.006		1.004		1.002		1.001		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit A4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
CONTRACT SURETY
EVALUATED AS OF 9/30/10

Closed Claim Projection

																			Indicated
							Cumulative Closed						Indicated Ultimate						Ultimate
Accident	Closed Claim Counts						Development Factors						Closed Claims						Closed
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Claims
1987&Prior		7,299		7,299		7,300		1.000		1.000		1.000		7,299		7,299		7,300		7,300
1988		384		389		389		1.001		1.000		1.000		384		389		389		389
1989		447		447		447		1.002		1.001		1.000		448		447		447		447
1990		630		632		632		1.003		1.002		1.001		632		633		633		633
1991		679		680		680		1.005		1.003		1.002		682		682		681		681
1992		718		719		719		1.007		1.005		1.004		723		723		722		722
1993		715		715		716		1.010		1.007		1.006		722		720		720		720
1994		762		764		765		1.013		1.010		1.008		772		772		771		771
1995		680		683		684		1.017		1.013		1.011		692		692		692		692
1996		519		521		522		1.022		1.017		1.014		530		530		529		529
1997		533		537		539		1.029		1.022		1.018		548		549		549		549
1998		652		658		658		1.038		1.029		1.024		677		677		674		674
1999		753		762		766		1.048		1.038		1.031		789		791		790		790
2000		842		870		878		1.065		1.048		1.041		897		912		914		914
2001		1,262		1,315		1,323		1.097		1.065		1.052		1,384		1,400		1,392		1,392
2002		1,073		1,120		1,129		1.151		1.097		1.073		1,235		1,229		1,211		1,211
2003		822		871		881		1.236		1.151		1.110		1,016		1,003		978		978
2004		438		490		503		1.421		1.236		1.172		622		606		590		590
2005		318		364		373		1.820		1.421		1.280		579		517		477		477
2006		175		270		281		2.632		1.820		1.512		461		491		425		425
2007		119		223		252		4.864		2.632		1.996		579		587		503		503
2008		33		141		198		17.861		4.864		3.069		589		686		608		608
2009				47		108				17.861		6.733				839		727		727
2010						24						29.953						719		539

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit A5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
CONTRACT SURETY
EVALUATED AS OF 9/30/10

Selection of Ultimate Reported Claims

			Indicated Ultimate Reported Claims*				Selected
	Reported		Based on		Based on		Ultimate
Accident	Claims		Reported Claim		Closed Claim		Reported
Year	@9/30/10		Projection		Projection		Claims
1987&Prior		7,318		7,318		7,300		7,318
1988		389		389		389		389
1989		452		452		447		452
1990		632		632		633		632
1991		683		683		681		683
1992		720		720		722		720
1993		720		720		720		720
1994		767		767		771		767
1995		686		686		692		686
1996		530		530		529		530
1997		541		542		549		542
1998		673		674		674		674
1999		787		789		790		789
2000		902		906		914		906
2001		1,369		1,376		1,392		1,376
2002		1,187		1,195		1,211		1,195
2003		977		986		978		986
2004		594		601		590		601
2005		438		445		477		445
2006		342		352		425		352
2007		353		370		503		370
2008		422		460		608		460
2009		492		632		727		632
2010		220		339		539		339
Total		22,194		22,564		23,261		22,564

* Projection methods for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Assumed Business
Exhibit A6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
CONTRACT SURETY
EVALUATED AS OF 9/30/10

Summary of Claims Diagnostics

												Selected
	Reported		CWI			Outstanding		Incurred		Closed		Ultimate
Accident	Claims		Claims			Claims		Claims		Claims		Reported
Year	@9/30/10		@9/30/10			@9/30/10		@9/30/10		@9/30/10		Claims
1987&Prior		7,318		2,642			18		2,660		7,300		7,318
1988		389		143			0		143		389		389
1989		452		165			5		170		447		452
1990		632		276			0		276		632		632
1991		683		263			3		266		680		683
1992		720		275			1		276		719		720
1993		720		192			4		196		716		720
1994		767		132			2		134		765		767
1995		686		129			2		131		684		686
1996		530		71			8		79		522		530
1997		541		39			2		41		539		542
1998		673		43			15		58		658		674
1999		787		90			21		111		766		789
2000		902		123			24		147		878		906
2001		1,369		138			46		184		1,323		1,376
2002		1,187		106			58		164		1,129		1,195
2003		977		87			96		183		881		986
2004		594		9			91		100		503		601
2005		438		5			65		70		373		445
2006		342		2			61		63		281		352
2007		353		0			101		101		252		370
2008		422		0			224		224		198		460
2009		492		(1	)		384		383		108		632
2010		220		0			196		196		24		339
Total		22,194		4,929			1,427		6,356		20,767		22,564

Milliman

WSC Assumed Business
Exhibit B1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		82,189		89,690		98,717		274,102		278,379		281,443		283,002		283,458		283,838		283,680		283,682		283,682		283,748		283,748		283,748		283,868		284,188		284,656		285,068		285,338		285,531		285,621		285,741		285,856
1988		0		509		22,866		24,329		24,409		24,638		24,668		25,000		25,000		25,000		25,000		25,170		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220
1989		514		18,693		19,888		20,745		21,706		22,134		22,286		22,561		22,561		22,643		23,393		23,905		23,905		23,905		23,905		23,905		23,905		23,905		23,905		23,905		24,005		24,216
1990		3,458		10,279		17,307		20,859		22,261		22,478		22,762		23,075		23,111		23,641		23,720		23,720		23,727		23,727		23,762		23,762		23,762		23,762		23,762		23,762		23,762
1991		4,716		21,423		31,656		34,289		35,028		36,323		37,091		37,633		37,887		38,667		38,699		38,749		38,749		38,749		38,749		38,749		38,749		38,749		38,749		38,749
1992		7,888		25,173		43,822		54,603		61,923		62,221		62,919		63,668		63,865		63,865		63,865		63,865		64,185		64,185		64,185		64,185		64,185		64,185		64,185
1993		2,428		44,409		73,108		78,058		78,401		82,717		83,137		83,630		83,984		83,985		84,120		84,120		84,120		84,270		84,270		84,289		84,289		84,349
1994		3,291		24,287		41,100		46,811		49,651		50,887		55,708		55,917		57,702		57,792		57,792		57,792		57,792		57,792		57,792		57,792		57,792
1995		1,238		12,248		16,724		18,045		18,164		18,461		18,516		18,716		18,828		19,053		19,053		19,053		19,053		19,056		19,056		19,056
1996		5,680		10,177		11,811		12,338		12,716		13,174		13,174		13,239		13,233		13,233		13,233		13,233		13,233		13,233		13,233
1997		4,794		7,606		9,868		10,174		10,843		11,152		12,858		12,858		12,858		12,883		12,886		12,886		12,886		12,886
1998		1,768		9,730		13,494		14,458		14,736		15,539		15,708		16,351		16,360		16,360		16,360		16,360		16,360
1999		5,594		17,449		22,574		24,637		27,806		29,996		30,048		30,258		30,258		30,268		30,268		30,273
2000		5,749		43,826		59,304		67,209		68,951		69,920		72,094		72,686		72,692		72,718		72,718
2001		10,573		28,906		34,899		37,053		42,871		49,030		49,685		50,436		50,369		52,534
2002		3,701		14,033		26,638		32,405		33,688		42,434		42,374		42,453		42,552
2003		1,568		33,124		49,556		54,837		59,367		58,692		59,280		60,298
2004		120		9,256		10,952		19,574		24,023		24,130		24,308
2005		0		1,323		2,483		2,735		2,735		2,807
2006		0		530		1,174		588		936
2007		0		846		273		376
2008		4		398		624
2009		2,929		5,276
2010		131

* Excludes Dick Corporation in 2005. Last Diagonal is as of 9/30/10.

Accident	Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.091		1.101		2.777		1.016		1.011		1.006		1.002		1.001		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.002		1.001		1.001		1.001		1.000		1.000		1.001
1988		N/A		44.923		1.064		1.003		1.009		1.001		1.013		1.000		1.000		1.000		1.007		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		36.368		1.064		1.043		1.046		1.020		1.007		1.012		1.000		1.004		1.033		1.022		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.004		1.012
1990		2.973		1.684		1.205		1.067		1.010		1.013		1.014		1.002		1.023		1.003		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1991		4.543		1.478		1.083		1.022		1.037		1.021		1.015		1.007		1.021		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		3.191		1.741		1.246		1.134		1.005		1.011		1.012		1.003		1.000		1.000		1.000		1.005		1.000		1.000		1.000		1.000		1.000		1.000
1993		18.290		1.646		1.068		1.004		1.055		1.005		1.006		1.004		1.000		1.002		1.000		1.000		1.002		1.000		1.000		1.000		1.001
1994		7.380		1.692		1.139		1.061		1.025		1.095		1.004		1.032		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		9.893		1.365		1.079		1.007		1.016		1.003		1.011		1.006		1.012		1.000		1.000		1.000		1.000		1.000		1.000
1996		1.792		1.161		1.045		1.031		1.036		1.000		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.587		1.297		1.031		1.066		1.028		1.153		1.000		1.000		1.002		1.000		1.000		1.000		1.000
1998		5.503		1.387		1.071		1.019		1.054		1.011		1.041		1.001		1.000		1.000		1.000		1.000
1999		3.119		1.294		1.091		1.129		1.079		1.002		1.007		1.000		1.000		1.000		1.000
2000		7.623		1.353		1.133		1.026		1.014		1.031		1.008		1.000		1.000		1.000
2001		2.734		1.207		1.062		1.157		1.144		1.013		1.015		0.999		1.058
2002		3.792		1.898		1.216		1.040		1.260		0.999		1.002		1.003
2003		21.125		1.496		1.107		1.083		0.989		1.010		1.023
2004		77.133		1.183		1.787		1.227		1.004		1.010
2005		N/A		1.877		1.101		1.000		1.035
2006		N/A		2.215		0.501		1.859
2007		N/A		0.323		1.532
2008		99.500		1.821
2009		2.192
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		16.307		3.418		1.209		1.100		1.044		1.022		1.011		1.004		1.008		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.004		1.000		1.001
Average x 87		17.152		3.529		1.130		1.104		1.046		1.023		1.012		1.004		1.009		1.003		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.006		1.000
Average x H/L		12.308		1.498		1.163		1.063		1.034		1.015		1.010		1.002		1.005		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		N/A		1.627		1.247		1.116		1.061		1.011		1.010		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Average		2.904		1.436		1.395		1.048		1.034		1.016		1.008		1.004		1.006		1.001		1.001		1.001		1.000		1.000		1.000		1.001		1.001		1.001		1.001		1.001		1.001		1.000		1.001
WA x 1987		5.160		1.527		1.127		1.064		1.045		1.020		1.011		1.005		1.009		1.002		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.006		1.000
Wtd Avg L5		3.245		1.263		1.213		1.098		1.089		1.015		1.012		1.000		1.016		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.001
Selected		5.160		1.527		1.247		1.098		1.089		1.015		1.011		1.005		1.006		1.005		1.004		1.003		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		12.518		2.426		1.589		1.274		1.160		1.065		1.049		1.038		1.033		1.027		1.022		1.018		1.015		1.013		1.011		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		20.629		3.656		1.766		1.346		1.187		1.088		1.053		1.041		1.034		1.029		1.023		1.019		1.016		1.014		1.012		1.010		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001

Milliman

WSC Assumed Business
Exhibit B2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection*

																			Indicated
							Cumulative												Ultimate
Accident	Paid Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		285,621		285,741		285,856		1.003		1.002		1.001		286,478		286,312		286,142		286,142
1988		25,220		25,220		25,220		1.004		1.003		1.002		25,321		25,296		25,270		25,270
1989		23,905		24,005		24,216		1.005		1.004		1.003		24,025		24,101		24,289		24,289
1990		23,762		23,762		23,762		1.006		1.005		1.004		23,905		23,881		23,857		23,857
1991		38,749		38,749		38,749		1.007		1.006		1.005		39,020		38,981		38,943		38,943
1992		64,185		64,185		64,185		1.008		1.007		1.006		64,698		64,634		64,570		64,570
1993		84,289		84,289		84,349		1.009		1.008		1.007		85,048		84,963		84,939		84,939
1994		57,792		57,792		57,792		1.011		1.009		1.008		58,428		58,312		58,254		58,254
1995		19,056		19,056		19,056		1.013		1.011		1.010		19,304		19,266		19,247		19,247
1996		13,233		13,233		13,233		1.015		1.013		1.012		13,431		13,405		13,392		13,392
1997		12,886		12,886		12,886		1.018		1.015		1.014		13,118		13,079		13,066		13,066
1998		16,360		16,360		16,360		1.022		1.018		1.016		16,720		16,654		16,622		16,622
1999		30,268		30,268		30,273		1.027		1.022		1.019		31,085		30,934		30,848		30,848
2000		72,692		72,718		72,718		1.033		1.027		1.023		75,091		74,681		74,391		74,391
2001		50,436		50,369		52,534		1.038		1.033		1.029		52,353		52,031		54,057		54,057
2002		42,374		42,453		42,552		1.049		1.038		1.034		44,450		44,066		43,999		43,999
2003		58,692		59,280		60,298		1.065		1.049		1.041		62,507		62,185		62,770		62,770
2004		24,023		24,130		24,308		1.160		1.065		1.053		27,867		25,698		25,596		25,596
2005		2,735		2,735		2,807		1.274		1.160		1.088		3,484		3,173		3,054		3,054
2006		1,174		588		936		1.589		1.274		1.187		1,865		749		1,111		1,111
2007		846		273		376		2.426		1.589		1.346		2,052		434		506		506
2008		4		398		624		12.518		2.426		1.766		50		966		1,102		1,102
2009				2,929		5,276				12.518		3.656				36,665		19,289		19,289
2010						131						20.629						2,702		2,027

* Excludes Dick Corporation in 2005.

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit B3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Incurred Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		93,365		97,884		104,700		284,008		286,085		284,884		284,298		284,984		284,924		283,956		283,892		283,863		283,893		283,748		283,748		283,869		285,748		285,748		286,248		286,248		286,248		286,248		286,993		287,073
1988		0		685		23,822		24,822		24,758		24,799		24,772		25,174		25,132		25,000		25,000		25,170		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220
1989		518		20,333		21,699		21,736		22,130		22,674		22,697		22,636		22,976		23,733		23,458		23,905		23,905		23,905		23,905		23,905		23,905		23,905		23,905		23,905		24,905		24,905
1990		6,391		14,249		20,943		22,700		23,275		24,115		26,153		26,600		27,075		27,003		26,758		26,068		23,730		23,778		23,778		23,778		23,762		23,762		23,762		23,762		23,762
1991		7,221		28,061		36,399		39,125		40,565		38,527		38,502		38,259		38,470		38,938		39,377		38,751		38,751		38,751		38,749		38,749		38,749		38,749		38,749		38,749
1992		10,743		33,132		58,373		61,934		65,870		67,324		65,230		65,026		65,010		64,771		64,473		64,452		64,196		64,196		64,196		64,188		64,188		64,185		64,185
1993		3,525		74,456		86,173		87,977		87,436		86,292		85,180		84,199		84,343		84,243		84,207		84,170		84,132		84,274		84,270		84,289		84,289		84,349
1994		9,035		31,199		51,491		53,807		53,835		53,439		58,492		58,304		57,948		57,964		57,956		57,946		57,792		57,792		57,792		57,792		57,792
1995		4,614		18,191		20,330		19,039		18,888		18,805		18,769		18,970		18,947		19,073		19,062		19,054		19,053		19,056		19,056		19,056
1996		6,469		12,397		13,283		13,028		13,003		13,414		13,303		13,367		13,361		13,361		13,381		13,381		14,253		14,253		14,253
1997		6,652		9,822		15,350		15,153		16,047		14,904		13,327		13,182		12,945		12,918		12,921		12,921		12,921		12,921
1998		3,822		18,190		16,354		15,993		15,926		18,131		18,134		16,697		16,636		16,592		16,592		16,592		16,592
1999		9,510		26,586		25,725		28,991		30,955		31,008		30,929		30,569		30,549		30,559		30,450		30,453
2000		10,174		69,524		75,982		72,085		71,492		71,639		73,530		73,870		73,230		72,742		72,742
2001		16,824		38,295		43,753		43,932		53,041		53,915		53,555		53,812		52,342		54,056
2002		4,904		29,804		36,233		35,273		42,477		43,670		43,102		43,075		43,062
2003		26,822		52,032		62,547		63,896		64,307		62,055		63,346		62,824
2004		198		10,611		20,549		29,078		25,336		24,868		24,898
2005		296		10,198		9,578		9,655		9,274		9,297
2006		0		1,014		3,358		3,103		3,119
2007		0		846		273		443
2008		4		544		1,518
2009		3,146		6,164
2010		192

* Excludes Dick Corporation in 2005. Last Diagonal is as of 9/30/10.

Accident	Incurred Loss Development Factors**
Year	12-24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.048		1.070		2.713		1.007		0.996		0.998		1.002		1.000		0.997		1.000		1.000		1.000		0.999		1.000		1.000		1.007		1.000		1.002		1.000		1.000		1.000		1.003		1.000
1988		N/A		34.777		1.042		0.997		1.002		0.999		1.016		0.998		0.995		1.000		1.007		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		39.253		1.067		1.002		1.018		1.025		1.001		0.997		1.015		1.033		0.988		1.019		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.042		1.000
1990		2.230		1.470		1.084		1.025		1.036		1.085		1.017		1.018		0.997		0.991		0.974		0.910		1.002		1.000		1.000		0.999		1.000		1.000		1.000		1.000
1991		3.886		1.297		1.075		1.037		0.950		0.999		0.994		1.006		1.012		1.011		0.984		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		3.084		1.762		1.061		1.064		1.022		0.969		0.997		1.000		0.996		0.995		1.000		0.996		1.000		1.000		1.000		1.000		1.000		1.000
1993		21.122		1.157		1.021		0.994		0.987		0.987		0.988		1.002		0.999		1.000		1.000		1.000		1.002		1.000		1.000		1.000		1.001
1994		3.453		1.650		1.045		1.001		0.993		1.095		0.997		0.994		1.000		1.000		1.000		0.997		1.000		1.000		1.000		1.000
1995		3.943		1.118		0.936		0.992		0.996		0.998		1.011		0.999		1.007		0.999		1.000		1.000		1.000		1.000		1.000
1996		1.916		1.071		0.981		0.998		1.032		0.992		1.005		1.000		1.000		1.001		1.000		1.065		1.000		1.000
1997		1.477		1.563		0.987		1.059		0.929		0.894		0.989		0.982		0.998		1.000		1.000		1.000		1.000
1998		4.759		0.899		0.978		0.996		1.138		1.000		0.921		0.996		0.997		1.000		1.000		1.000
1999		2.796		0.968		1.127		1.068		1.002		0.997		0.988		0.999		1.000		0.996		1.000
2000		6.833		1.093		0.949		0.992		1.002		1.026		1.005		0.991		0.993		1.000
2001		2.276		1.143		1.004		1.207		1.016		0.993		1.005		0.973		1.044
2002		6.077		1.216		0.974		1.204		1.028		0.987		0.999		1.000
2003		1.940		1.202		1.022		1.006		0.965		1.021		0.989
2004		53.591		1.937		1.415		0.871		0.982		1.002
2005		34.453		0.939		1.008		0.961		1.003
2006		N/A		3.312		0.924		1.007
2007		N/A		0.323		1.907
2008		136.000		3.929
2009		2.452
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		16.629		2.953		1.155		1.025		1.005		1.002		0.995		0.998		1.005		0.999		0.999		0.998		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.010		1.000		1.001		1.000
Average x 87		17.450		3.042		1.077		1.026		1.006		1.003		0.995		0.998		1.005		0.999		0.999		0.997		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.014		1.000		1.000
Average x H/L		10.863		1.493		1.085		1.024		1.002		1.003		0.999		0.999		1.002		0.999		0.999		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		N/A		2.062		1.148		0.991		1.000		1.005		0.998		0.996		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Average		2.702		1.252		1.266		1.024		0.999		1.004		0.998		0.998		1.002		0.999		0.999		0.997		1.000		1.000		1.000		1.003		1.000		1.001		1.000		1.003		1.000		1.002		1.000
WA x 1987		3.881		1.288		1.031		1.031		1.000		1.006		0.996		0.997		1.005		0.999		0.998		0.995		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.014		1.000		1.000
Wtd Avg L5		8.487		1.546		1.103		1.025		0.997		1.009		0.998		0.990		1.009		0.999		1.000		1.006		1.001		1.000		1.000		1.000		1.000		1.000		1.000
Selected		3.881		1.288		1.103		1.031		1.020		1.009		1.005		1.003		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		5.985		1.542		1.197		1.085		1.052		1.031		1.022		1.017		1.014		1.012		1.011		1.010		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.001		1.001		1.001
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		8.850		2.164		1.275		1.112		1.060		1.036		1.024		1.018		1.015		1.013		1.011		1.010		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.001		1.001		1.001

Milliman

WSC Assumed Business
Exhibit B4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection*

																			Indicated
							Cumulative												Ultimate
Accident	Incurred Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		286,248		286,993		287,073		1.001		1.001		1.001		286,534		287,280		287,360		287,360
1988		25,220		25,220		25,220		1.001		1.001		1.001		25,245		25,245		25,245		25,245
1989		23,905		24,905		24,905		1.002		1.001		1.001		23,953		24,930		24,930		24,930
1990		23,762		23,762		23,762		1.003		1.002		1.001		23,833		23,810		23,786		23,786
1991		38,749		38,749		38,749		1.004		1.003		1.002		38,904		38,865		38,826		38,826
1992		64,188		64,185		64,185		1.005		1.004		1.003		64,509		64,442		64,378		64,378
1993		84,289		84,289		84,349		1.006		1.005		1.004		84,795		84,710		84,686		84,686
1994		57,792		57,792		57,792		1.007		1.006		1.005		58,197		58,139		58,081		58,081
1995		19,056		19,056		19,056		1.008		1.007		1.006		19,208		19,189		19,170		19,170
1996		14,253		14,253		14,253		1.009		1.008		1.007		14,381		14,367		14,353		14,353
1997		12,921		12,921		12,921		1.010		1.009		1.008		13,050		13,037		13,024		13,024
1998		16,592		16,592		16,592		1.011		1.010		1.009		16,775		16,758		16,741		16,741
1999		30,559		30,450		30,453		1.012		1.011		1.010		30,926		30,785		30,758		30,758
2000		73,230		72,742		72,742		1.014		1.012		1.011		74,255		73,615		73,542		73,542
2001		53,812		52,342		54,056		1.017		1.014		1.013		54,727		53,075		54,759		54,759
2002		43,102		43,075		43,062		1.022		1.017		1.015		44,050		43,807		43,708		43,708
2003		62,055		63,346		62,824		1.031		1.022		1.018		63,979		64,740		63,955		63,955
2004		25,336		24,868		24,898		1.052		1.031		1.024		26,653		25,639		25,496		25,496
2005		9,655		9,274		9,297		1.085		1.052		1.036		10,476		9,756		9,632		9,632
2006		3,358		3,103		3,119		1.197		1.085		1.060		4,020		3,367		3,306		3,306
2007		846		273		443		1.542		1.197		1.112		1,305		327		493		493
2008		4		544		1,518		5.985		1.542		1.275		24		839		1,935		1,935
2009				3,146		6,164				5.985		2.164				18,829		13,339		13,339
2010						192						8.850						1,699		1,274

* Excludes Dick Corporation in 2005.

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit B5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1987-2005 Ultimate Losses* ($000s)

	Incurred		Indicated Ultimate Losses Based on				Selected
Accident	Losses		Paid Loss		Incurred Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1987&Prior		287,073		286,142		287,360		287,360
1988		25,220		25,270		25,245		25,245
1989		24,905		24,289		24,930		24,930
1990		23,762		23,857		23,786		23,786
1991		38,749		38,943		38,826		38,826
1992		64,185		64,570		64,378		64,378
1993		84,349		84,939		84,686		84,686
1994		57,792		58,254		58,081		58,081
1995		19,056		19,247		19,170		19,209
1996		14,253		13,392		14,353		14,353
1997		12,921		13,066		13,024		13,024
1998		16,592		16,622		16,741		16,741
1999		30,453		30,848		30,758		30,758
2000		72,742		74,391		73,542		73,542
2001		54,056		54,057		54,759		54,759
2002		43,062		43,999		43,708		43,708
2003		62,824		62,770		63,955		63,955
2004		24,898		25,596		25,496		25,496
2005		9,297		3,054		9,632		9,632
Total		966,189		963,306		972,430		972,469

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Loss* ($000s)

	Selected
Accident	Ultimate		Paid Losses						Hindsight Outstanding Losses
Year	Losses		@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos		@60 Mos
1987&Prior		287,360		98,717		274,102		278,379		188,643		13,258		8,981
1988		25,245		22,866		24,329		24,409		2,379		916		836
1989		24,930		19,888		20,745		21,706		5,042		4,185		3,224
1990		23,786		17,307		20,859		22,261		6,479		2,927		1,525
1991		38,826		31,656		34,289		35,028		7,170		4,537		3,798
1992		64,378		43,822		54,603		61,923		20,556		9,775		2,455
1993		84,686		73,108		78,058		78,401		11,578		6,628		6,285
1994		58,081		41,100		46,811		49,651		16,981		11,270		8,430
1995		19,209		16,724		18,045		18,164		2,485		1,164		1,045
1996		14,353		11,811		12,338		12,716		2,542		2,015		1,637
1997		13,024		9,868		10,174		10,843		3,156		2,850		2,181
1998		16,741		13,494		14,458		14,736		3,247		2,283		2,005
1999		30,758		22,574		24,637		27,806		8,184		6,121		2,952
2000		73,542		59,304		67,209		68,951		14,238		6,333		4,591
2001		54,759		34,899		37,053		42,871		19,860		17,706		11,888
2002		43,708		26,638		32,405		33,688		17,070		11,303		10,020
2003		63,955		49,556		54,837		59,367		14,399		9,118		4,588
2004		25,496		10,952		19,574		24,023		14,544		5,922		1,473
2005		9,632		2,483		2,735		2,735		7,149		6,897		6,897

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
	Ultimate
Accident	Reported		Closed Claims						Yet to Close
Year	Claims		@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos		@60 Mos
1987&Prior		7,318		2,015		6,704		6,871		5,303		614		447
1988		389		205		245		292		184		144		97
1989		452		161		257		306		291		195		146
1990		632		188		320		410		444		312		222
1991		683		197		324		396		486		359		287
1992		720		195		298		418		525		422		302
1993		720		161		320		461		559		400		259
1994		767		269		441		556		498		326		211
1995		686		324		469		540		362		217		146
1996		530		291		376		437		239		154		93
1997		542		304		397		425		238		145		117
1998		674		376		439		502		298		235		172
1999		789		318		428		605		471		361		184
2000		906		328		518		612		578		388		294
2001		1,376		562		803		941		814		573		435
2002		1,195		410		588		830		785		607		365
2003		986		363		537		769		623		449		217
2004		601		203		383		438		398		218		163
2005		445		260		318		364		185		127		81

Milliman

WSC Assumed Business
Exhibit B8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

							Average Hindsight Outstanding @ 9/30/10
							Trended using 5.0% to
Accident	Average Hindsight Outstanding @ 9/30/10						2008		2007		2006
Year	@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos		@60 Mos
1987&Prior		35.573		21.593		20.092		99.105		57.293		50.771
1988		12.929		6.361		8.619		34.304		16.074		20.743
1989		17.326		21.462		22.082		43.782		51.651		50.612
1990		14.592		9.381		6.869		35.117		21.501		14.994
1991		14.753		12.638		13.233		33.814		27.587		27.510
1992		39.154		23.164		8.129		85.468		48.156		16.095
1993		20.712		16.570		24.266		43.059		32.807		45.757
1994		34.098		34.571		39.953		67.512		65.189		71.750
1995		6.865		5.364		7.158		12.945		9.633		12.243
1996		10.636		13.084		17.602		19.101		22.378		28.672
1997		13.261		19.655		18.641		22.681		32.016		28.918
1998		10.896		9.715		11.657		17.748		15.071		17.223
1999		17.376		16.956		16.043		26.956		25.052		22.574
2000		24.633		16.322		15.616		36.394		22.967		20.927
2001		24.398		30.901		27.329		34.330		41.410		34.879
2002		21.745		18.621		27.452		29.140		23.766		33.368
2003		23.112		20.307		21.143		29.497		24.683		24.476
2004		36.543		27.165		9.037		44.418		31.447		9.963
2005		38.643		54.307		85.148		44.734		59.873		89.405
Selection								36.424		36.236		38.418

	Closed Claims @ 9/30/10				Indicated Reserve for Claims Yet to Close						Paid		Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Losses		Ultimate
Year	Claims		Claim		to Close		Claim		Loss		@9/30/10		Losses
2006		281		3.331		71		38.418		2,728		936		3,664
2007		252		1.492		118		36.236		4,276		376		4,652
2008		198		3.152		262		36.424		9,543		624		10,167

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B9

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection* ($000s)

			Selected		Ultimate
	Gross		Ultimate		Loss
Accident	Earned		Losses		Ratio
Year	Premium		@9/30/10		@9/30/10
1988		63,396		25,245		39.8	%
1989		89,273		24,930		27.9	%
1990		116,027		23,786		20.5	%
1991		122,069		38,826		31.8	%
1992		121,804		64,378		52.9	%
1993		129,050		84,686		65.6	%
1994		133,188		58,081		43.6	%
1995		125,135		19,209		15.4	%
1996		109,648		14,353		13.1	%
1997		103,547		13,024		12.6	%
1998		108,606		16,741		15.4	%
1999		121,586		30,758		25.3	%
2000		133,694		73,542		55.0	%
2001		142,878		54,759		38.3	%
2002		147,152		43,708		29.7	%
2003		145,852		63,955		43.8	%
2004		107,392		25,496		23.7	%
2005		91,292		9,632		10.6	%
Total		2,111,589		685,109		32.4	%
M3L5		397,422		123,963		31.2	%

	Ultimate			Gross		A Priori		Estimated					Incurred		Indicated
Accident	Loss			Earned		Ultimate		Percent			Indicated		Losses		Ultimate
Year	Ratio			Premium		Losses		Unreported			IBNR		@9/30/10		Losses
2006		31.2	%		94,006		29,330		5.7	%		1,672		3,119		4,791
2007		31.2	%		96,030		29,961		10.1	%		3,026		443		3,469
2008		31.2	%		93,033		29,026		21.6	%		6,270		1,518		7,788
Total					283,069		88,317					10,968		5,080		16,048

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B10

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2006-2008 Ultimate Losses ($000s)

			Indicated Ultimate Losses Based on:
							Average
	Incurred						Hindsight						Selected
Accident	Losses		Paid Loss		Incurred Loss		Outstanding		Incurred B/F		Loss Ratio		Ultimate
Year	@9/30/10		Projection		Projection		Projection		Projection		Projection*		Losses
2006		3,119		1,111		3,306		3,664		4,791		29,330		4,049
2007		443		506		493		4,652		3,469		29,961		9,644
2008		1,518		1,102		1,935		10,167		7,788		29,026		12,229
Total		5,080		2,719		5,734		18,483		16,048		88,317		25,922

* Equal to the A Priori from the Incurred B/F Projection.

Milliman

WSC Assumed Business
Exhibit B11

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection* ($000s)

	Selected		Gross		Gross
	Ultimate		Earned		Ultimate
Accident	Losses		Premium		Loss Ratio
Year	@9/30/10		@9/30/10		@9/30/10
1988		25,245		63,396		39.8	%
1989		24,930		89,273		27.9	%
1990		23,786		116,027		20.5	%
1991		38,826		122,069		31.8	%
1992		64,378		121,804		52.9	%
1993		84,686		129,050		65.6	%
1994		58,081		133,188		43.6	%
1995		19,209		125,135		15.4	%
1996		14,353		109,648		13.1	%
1997		13,024		103,547		12.6	%
1998		16,741		108,606		15.4	%
1999		30,758		121,586		25.3	%
2000		73,542		133,694		55.0	%
2001		54,759		142,878		38.3	%
2002		43,708		147,152		29.7	%
2003		63,955		145,852		43.8	%
2004		25,496		107,392		23.7	%
2005		9,632		91,292		10.6	%
2006		4,049		94,006		4.3	%
2007		9,644		96,030		10.0	%
2008		12,229		93,033		13.1	%
Total		711,031		2,394,658		29.7	%
L7		168,713		774,757		21.8	%

	(a)		(b)			(a) x (b)
	Gross		Selected			Indicated
Accident	Earned		Ultimate			Ultimate
Year	Premium		Loss Ratio			Losses
2009		82,043		21.8	%		17,885
2010		56,471		21.8	%		12,311

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B12

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection ($000s)

	A-Priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent			Indicated		Losses		Ultimate
Year	Losses*		Unreported			IBNR		@9/30/10		Losses**
2009		17,885		53.8	%		9,622		6,164		15,786
2010		16,415		88.7	%		14,560		192		11,064
Total		34,300					24,182		6,356		26,850

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9  months exposure.

Milliman

WSC Assumed Business
Exhibit B13

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection ($000s)

	A-Priori		Estimated					Paid		Indicated
Accident	Ultimate		Percent			Indicated		Losses		Ultimate
Year	Losses*		Unpaid			Unpaid		@9/30/10		Losses**
2009		17,885		72.6	%		12,985		5,276		18,261
2010		16,415		95.2	%		15,627		131		11,819
Total		34,300					28,612		5,407		30,080

*	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months exposure.

Milliman

WSC Assumed Business
Exhibit B14

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Losses* ($000s)

	Selected						Hindsight
Accident	Ultimate		Paid Losses				Outstanding Losses
Year	Losses		@12 Mos		@24 Mos		@12 Mos		@24 Mos
1987&Prior		287,360		82,189		89,690		205,171		197,670
1988		25,245		0		509		25,245		24,736
1989		24,930		514		18,693		24,416		6,237
1990		23,786		3,458		10,279		20,328		13,507
1991		38,826		4,716		21,423		34,110		17,403
1992		64,378		7,888		25,173		56,490		39,205
1993		84,686		2,428		44,409		82,258		40,277
1994		58,081		3,291		24,287		54,790		33,794
1995		19,209		1,238		12,248		17,971		6,961
1996		14,353		5,680		10,177		8,673		4,176
1997		13,024		4,794		7,606		8,230		5,418
1998		16,741		1,768		9,730		14,973		7,011
1999		30,758		5,594		17,449		25,164		13,309
2000		73,542		5,749		43,826		67,793		29,716
2001		54,759		10,573		28,906		44,186		25,853
2002		43,708		3,701		14,033		40,007		29,675
2003		63,955		1,568		33,124		62,387		30,831
2004		25,496		120		9,256		25,376		16,240
2005		9,632		0		1,323		9,632		8,309
2006		4,049		0		530		4,049		3,519
2007		9,644		0		846		9,644		8,798
2008		12,229		4		398		12,225		11,831

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B15

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
	Ultimate
Accident	Reported		Closed Claims				Yet to Close
Year	Claims		@12 Mos		@24 Mos		@12 Mos		@24 Mos
1987&Prior		7,318		1,716		1,920		5,602		5,398
1988		389		0		6		389		383
1989		452		2		107		450		345
1990		632		18		96		614		536
1991		683		15		93		668		590
1992		720		11		82		709		638
1993		720		16		67		704		653
1994		767		12		57		755		710
1995		686		9		143		677		543
1996		530		18		143		512		387
1997		542		40		194		502		348
1998		674		69		217		605		457
1999		789		38		218		751		571
2000		906		47		170		859		736
2001		1,376		81		315		1,295		1,061
2002		1,195		76		229		1,119		966
2003		986		55		204		931		782
2004		601		28		108		573		493
2005		445		33		106		412		339
2006		352		25		112		327		240
2007		370		31		119		339		251
2008		460		33		141		427		319

Milliman

WSC Assumed Business
Exhibit B16

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

					Average Hindsight Outstanding @ 9/30/10
					Trended using 5.0% to
Accident	Average Hindsight Outstanding @ 9/30/10				2010		2009
Year	@12 Mos		@24 Mos		@12 Mos		@24 Mos
1987&Prior		36.625		36.619		112.495		107.120
1988		64.897		64.585		189.841		179.931
1989		54.258		18.078		151.161		47.966
1990		33.107		25.200		87.843		63.679
1991		51.063		29.497		129.034		70.988
1992		79.676		61.450		191.750		140.845
1993		116.844		61.680		267.809		134.640
1994		72.570		47.597		158.411		98.951
1995		26.545		12.820		55.185		25.383
1996		16.939		10.791		33.538		20.348
1997		16.394		15.569		30.913		27.960
1998		24.749		15.341		44.446		26.238
1999		33.507		23.308		57.308		37.966
2000		78.921		40.375		128.554		62.635
2001		34.120		24.367		52.931		36.001
2002		35.752		30.719		52.822		43.225
2003		67.011		39.426		94.291		52.835
2004		44.286		32.941		59.347		42.042
2005		23.379		24.510		29.838		29.792
2006		12.382		14.663		15.050		16.974
2007		28.448		35.052		32.932		38.645
2008		28.630		37.088		31.565		38.942
Selection						33.746		33.279

	Closed Claims @ 9/30/10				Indicated Reserve for Claims Yet to Close								Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Paid Losses		Ultimate
Year	Claims		Claim		to Close		Claim		Loss		@9/30/10		Losses
2009		108		48.852		524		33.279		17,438		5,276		22,714
2010		24		5.458		315		33.746		10,630		131		10,761

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B17

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2009-2010 Ultimate Losses ($000s)

					Indicated Ultimate Losses*												Selected		Ultimate
	Incurred		Gross		Paid		Incurred		Average		Incurred		Paid		Loss		Ultimate		Loss
Accident	Losses		Earned		Loss		Loss		Hindsight		B/F		B/F		Ratio		Losses		Ratio
Year	@9/30/10		Premium*		Projection		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2009		6,164		82,043		19,289		13,339		22,714		15,786		18,261		17,885		20,300		24.7	%
2010		192		56,471		2,027		1,274		10,761		11,064		11,819		12,311		12,311		21.8	%
Total		6,356		138,514		21,316		14,613		33,475		26,850		30,080		30,196		32,611		23.5	%

* Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Assumed Business
Exhibit B18

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses* ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Losses
Year	Losses		Losses		Losses		Outstanding		@9/30/10		@9/30/10
1987&Prior		287,360		285,856		287,073		1,217		287		1,504
1988		25,245		25,220		25,220		0		25		25
1989		24,930		24,216		24,905		689		25		714
1990		23,786		23,762		23,762		0		24		24
1991		38,826		38,749		38,749		0		77		77
1992		64,378		64,185		64,185		0		193		193
1993		84,686		84,349		84,349		0		337		337
1994		58,081		57,792		57,792		0		289		289
1995		19,209		19,056		19,056		0		153		153
1996		14,353		13,233		14,253		1,020		100		1,120
1997		13,024		12,886		12,921		35		103		138
1998		16,741		16,360		16,592		232		149		381
1999		30,758		30,273		30,453		180		305		485
2000		73,542		72,718		72,742		24		800		824
2001		54,759		52,534		54,056		1,522		703		2,225
2002		43,708		42,552		43,062		510		646		1,156
2003		63,955		60,298		62,824		2,526		1,131		3,657
2004		25,496		24,308		24,898		590		598		1,188
2005		9,632		2,807		9,297		6,490		335		6,825
2006		4,049		936		3,119		2,183		930		3,113
2007		9,644		376		443		67		9,201		9,268
2008		12,229		624		1,518		894		10,711		11,605
2009		20,300		5,276		6,164		888		14,136		15,024
2010		12,311		131		192		61		12,119		12,180
Total		1,031,002		958,497		977,625		19,128		53,377		72,505

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit B19

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		6,663		7,716		9,473		30,199		31,153		31,948		32,483		32,694		32,891		33,016		33,083		33,116		33,154		33,154		33,156		33,156		33,161		33,162		33,162		33,162		33,162		33,162		33,162		33,162
1988		0		39		1,432		1,936		1,978		1,997		2,128		2,224		2,310		2,337		2,344		2,400		2,402		2,403		2,403		2,403		2,403		2,403		2,403		2,403		2,403		2,403		2,403
1989		17		674		979		1,446		2,200		2,428		2,874		3,065		3,117		3,152		3,199		3,283		3,283		3,283		3,283		3,283		3,283		3,283		3,283		3,283		3,283		3,297
1990		147		1,126		1,925		2,372		2,846		3,266		3,486		4,007		4,280		4,460		4,500		4,519		4,610		4,648		4,663		4,664		4,679		4,679		4,680		4,680		4,680
1991		334		1,110		1,737		2,448		3,568		4,290		4,562		4,687		4,847		4,905		4,952		4,974		4,980		5,004		5,009		5,010		5,013		5,026		5,030		5,033
1992		382		1,574		3,670		5,019		6,952		7,808		8,225		8,306		8,368		8,447		8,551		8,630		8,635		8,637		8,637		8,637		8,637		8,637		8,637
1993		363		1,503		3,363		5,832		6,865		7,307		7,467		7,594		7,657		7,695		7,706		7,711		7,722		7,758		7,769		7,769		7,769		7,769
1994		20		951		2,573		4,169		4,902		4,933		5,783		5,995		6,088		6,098		6,105		6,105		6,105		6,105		6,105		6,105		6,105
1995		243		1,461		2,168		2,593		2,704		2,798		2,887		3,017		3,053		3,070		3,092		3,110		3,110		3,110		3,110		3,110
1996		101		606		1,061		1,161		1,249		1,405		1,496		1,540		1,584		1,635		1,656		1,688		1,770		1,828		1,870
1997		321		700		1,093		1,410		1,669		1,959		2,018		2,066		2,141		2,248		2,300		2,351		2,576		2,710
1998		115		690		1,593		1,911		2,525		3,406		3,709		3,732		3,772		3,773		3,758		3,758		3,758
1999		53		629		1,171		1,846		2,015		2,186		2,445		2,582		2,700		3,078		3,137		3,137
2000		131		1,341		4,802		7,543		7,941		8,505		9,464		9,615		9,656		9,683		9,692
2001		343		1,073		1,656		3,035		4,274		5,322		5,759		6,245		7,033		7,370
2002		59		423		1,090		1,385		1,722		1,842		1,923		2,139		2,264
2003		253		1,628		3,111		4,370		5,375		5,863		7,057		7,794
2004		13		119		301		1,629		1,855		2,090		2,090
2005		1		129		366		509		750		893
2006		38		73		124		175		204
2007		0		44		72		78
2008		46		140		174
2009		34		179
2010		30

* Last Diagonal is as of 9/30/10.

Accident	Paid ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.158		1.228		3.188		1.032		1.026		1.017		1.006		1.006		1.004		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1988		N/A		36.718		1.352		1.022		1.010		1.066		1.045		1.039		1.012		1.003		1.024		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		39.647		1.453		1.477		1.521		1.104		1.184		1.066		1.017		1.011		1.015		1.026		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.006
1990		7.660		1.710		1.232		1.200		1.148		1.067		1.149		1.068		1.042		1.009		1.004		1.020		1.008		1.003		1.000		1.003		1.000		1.000		1.000		1.000
1991		3.323		1.565		1.409		1.458		1.202		1.063		1.027		1.034		1.012		1.010		1.004		1.001		1.005		1.001		1.000		1.001		1.003		1.001		1.001
1992		4.120		2.332		1.368		1.385		1.123		1.053		1.010		1.007		1.009		1.012		1.009		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1993		4.140		2.238		1.734		1.177		1.064		1.022		1.017		1.008		1.005		1.001		1.001		1.001		1.005		1.001		1.000		1.000		1.000
1994		47.550		2.706		1.620		1.176		1.006		1.172		1.037		1.016		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1995		6.012		1.484		1.196		1.043		1.035		1.032		1.045		1.012		1.006		1.007		1.006		1.000		1.000		1.000		1.000
1996		6.000		1.751		1.094		1.076		1.125		1.065		1.029		1.029		1.032		1.013		1.019		1.049		1.033		1.031
1997		2.181		1.561		1.290		1.184		1.174		1.030		1.024		1.036		1.050		1.023		1.022		1.096		1.070
1998		6.000		2.309		1.200		1.321		1.349		1.089		1.006		1.011		1.000		0.996		1.000		1.000
1999		11.868		1.862		1.576		1.092		1.085		1.118		1.056		1.046		1.140		1.019		1.000
2000		10.237		3.581		1.571		1.053		1.071		1.113		1.016		1.004		1.003		1.001
2001		3.128		1.543		1.833		1.408		1.245		1.082		1.084		1.126		1.064
2002		7.169		2.577		1.271		1.243		1.070		1.044		1.112		1.079
2003		6.435		1.911		1.405		1.230		1.091		1.204		1.142
2004		9.154		2.529		5.412		1.139		1.127		1.000
2005		129.000		2.837		1.391		1.473		1.262
2006		1.921		1.699		1.411		1.227
2007		N/A		1.636		1.113
2008		3.043		1.336
2009		9.159

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Average	15.186	3.571	1.673	1.223	1.122	1.079	1.051	1.034	1.026	1.008	1.009	1.014	1.011	1.004	1.000	1.000	1.000	1.000	1.000	1.000	1.002	1.000	1.000
Average x 87	15.887	3.683	1.598	1.233	1.127	1.083	1.054	1.035	1.028	1.009	1.010	1.015	1.012	1.004	1.000	1.001	1.000	1.000	1.000	1.000	1.003	1.000
Average x H/L	9.934	2.031	1.507	1.218	1.115	1.076	1.048	1.029	1.019	1.008	1.008	1.007	1.006	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Avg L5 x H/L	7.119	1.955	1.402	1.233	1.154	1.080	1.084	1.045	1.039	1.011	1.008	1.016	1.012	1.000	1.000	1.000	1.000	1.000	1.000
Wtd Average	2.486	1.850	1.853	1.145	1.084	1.065	1.037	1.023	1.016	1.005	1.005	1.006	1.004	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
WA x 1987	5.423	2.150	1.484	1.213	1.113	1.089	1.050	1.031	1.022	1.007	1.007	1.009	1.008	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.003	1.000
Wtd Avg L5	6.185	2.079	1.702	1.229	1.149	1.113	1.075	1.048	1.038	1.006	1.007	1.018	1.013	1.002	1.000	1.001	1.000	1.000	1.000
Selected	5.423	2.079	1.702	1.229	1.149	1.113	1.075	1.048	1.038	1.007	1.007	1.009	1.008	1.005	1.002	1.001	1.001	1.001	1.000	1.000	1.000	1.000	1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		36.741		6.775		3.259		1.915		1.558		1.356		1.218		1.133		1.081		1.041		1.034		1.027		1.018		1.010		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		67.184		10.339		3.913		2.187		1.640		1.404		1.251		1.154		1.094		1.051		1.036		1.029		1.020		1.012		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit B20

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10
Paid ALAE Projection

																			Indicated
							Cumulative												Ultimate
Accident	Paid ALAE ($000s)						Development Factors						Indicated Ultimate ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		33,162		33,162		33,162		1.000		1.000		1.000		33,162		33,162		33,162		33,162
1988		2,403		2,403		2,403		1.000		1.000		1.000		2,403		2,403		2,403		2,403
1989		3,283		3,283		3,297		1.000		1.000		1.000		3,283		3,283		3,297		3,297
1990		4,680		4,680		4,680		1.000		1.000		1.000		4,680		4,680		4,680		4,680
1991		5,026		5,030		5,033		1.001		1.000		1.000		5,031		5,030		5,033		5,033
1992		8,637		8,637		8,637		1.002		1.001		1.000		8,654		8,646		8,637		8,637
1993		7,769		7,769		7,769		1.003		1.002		1.001		7,792		7,785		7,777		7,777
1994		6,105		6,105		6,105		1.005		1.003		1.002		6,136		6,123		6,117		6,117
1995		3,110		3,110		3,110		1.010		1.005		1.004		3,141		3,126		3,122		3,122
1996		1,770		1,828		1,870		1.018		1.010		1.006		1,802		1,846		1,881		1,881
1997		2,351		2,576		2,710		1.027		1.018		1.012		2,414		2,622		2,743		2,743
1998		3,758		3,758		3,758		1.034		1.027		1.020		3,886		3,859		3,833		3,833
1999		3,078		3,137		3,137		1.041		1.034		1.029		3,204		3,244		3,228		3,228
2000		9,656		9,683		9,692		1.081		1.041		1.036		10,438		10,080		10,041		10,041
2001		6,245		7,033		7,370		1.133		1.081		1.051		7,076		7,603		7,746		7,746
2002		1,923		2,139		2,264		1.218		1.133		1.094		2,342		2,423		2,477		2,477
2003		5,863		7,057		7,794		1.356		1.218		1.154		7,950		8,595		8,994		8,994
2004		1,855		2,090		2,090		1.558		1.356		1.251		2,890		2,834		2,615		2,615
2005		509		750		893		1.915		1.558		1.404		975		1,169		1,254		1,254
2006		124		175		204		3.259		1.915		1.640		404		335		335		335
2007		44		72		78		6.775		3.259		2.187		298		235		171		171
2008		46		140		174		36.741		6.775		3.913		1,690		949		681		681
2009				34		179				36.741		10.339				1,249		1,851		1,851
2010						30						67.184						2,016		1,512

          Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit B21

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE/Paid Loss* + 1
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		1.081		1.086		1.096		1.110		1.112		1.114		1.115		1.115		1.116		1.116		1.117		1.117		1.117		1.117		1.117		1.117		1.117		1.116		1.116		1.116		1.116		1.116		1.116		1.116
1988		N/A		1.077		1.063		1.080		1.081		1.081		1.086		1.089		1.092		1.093		1.094		1.095		1.095		1.095		1.095		1.095		1.095		1.095		1.095		1.095		1.095		1.095		1.095
1989		1.033		1.036		1.049		1.070		1.101		1.110		1.129		1.136		1.138		1.139		1.137		1.137		1.137		1.137		1.137		1.137		1.137		1.137		1.137		1.137		1.137		1.136
1990		1.043		1.110		1.111		1.114		1.128		1.145		1.153		1.174		1.185		1.189		1.190		1.191		1.194		1.196		1.196		1.196		1.197		1.197		1.197		1.197		1.197
1991		1.071		1.052		1.055		1.071		1.102		1.118		1.123		1.125		1.128		1.127		1.128		1.128		1.129		1.129		1.129		1.129		1.129		1.130		1.130		1.130
1992		1.048		1.063		1.084		1.092		1.112		1.125		1.131		1.130		1.131		1.132		1.134		1.135		1.135		1.135		1.135		1.135		1.135		1.135		1.135
1993		1.150		1.034		1.046		1.075		1.088		1.088		1.090		1.091		1.091		1.092		1.092		1.092		1.092		1.092		1.092		1.092		1.092		1.092
1994		1.006		1.039		1.063		1.089		1.099		1.097		1.104		1.107		1.106		1.106		1.106		1.106		1.106		1.106		1.106		1.106		1.106
1995		1.196		1.119		1.130		1.144		1.149		1.152		1.156		1.161		1.162		1.161		1.162		1.163		1.163		1.163		1.163		1.163
1996		1.018		1.060		1.090		1.094		1.098		1.107		1.114		1.116		1.120		1.124		1.125		1.128		1.134		1.138		1.141
1997		1.067		1.092		1.111		1.139		1.154		1.176		1.157		1.161		1.167		1.174		1.178		1.182		1.200		1.210
1998		1.065		1.071		1.118		1.132		1.171		1.219		1.236		1.228		1.231		1.231		1.230		1.230		1.230
1999		1.009		1.036		1.052		1.075		1.072		1.073		1.081		1.085		1.089		1.102		1.104		1.104
2000		1.023		1.031		1.081		1.112		1.115		1.122		1.131		1.132		1.133		1.133		1.133
2001		1.032		1.037		1.047		1.082		1.100		1.109		1.116		1.124		1.140		1.140
2002		1.016		1.030		1.041		1.043		1.051		1.043		1.045		1.050		1.053
2003		1.161		1.049		1.063		1.080		1.091		1.100		1.119		1.129
2004		1.108		1.013		1.027		1.083		1.077		1.087		1.086
2005		N/A		1.098		1.147		1.186		1.274		1.318
2006		N/A		1.138		1.106		1.298		1.218
2007		N/A		1.052		1.264		1.207
2008		12.500		1.352		1.279
2009		1.012		1.034
2010		1.229

* Excludes Dick Corporation in 2005. Last Diagonal is as of 9/30/10.

Accident	Paid ALAE/Paid Loss + 1 Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.005		1.009		1.013		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1988		N/A		0.987		1.016		1.001		1.000		1.005		1.002		1.003		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		1.003		1.013		1.020		1.030		1.008		1.017		1.006		1.002		1.001		0.998		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		0.999		0.999
1990		1.064		1.002		1.002		1.013		1.015		1.007		1.018		1.010		1.003		1.001		1.001		1.003		1.001		1.000		1.000		1.001		1.000		1.000		1.000		1.000
1991		0.982		1.003		1.016		1.028		1.015		1.004		1.001		1.003		0.999		1.001		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1992		1.013		1.020		1.008		1.019		1.012		1.005		1.000		1.001		1.001		1.001		1.001		0.999		1.000		1.000		1.000		1.000		1.000		1.000
1993		0.899		1.012		1.027		1.012		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1994		1.033		1.023		1.025		1.009		0.998		1.006		1.003		0.998		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		0.936		1.009		1.012		1.005		1.002		1.004		1.005		1.001		0.999		1.001		1.001		1.000		1.000		1.000		1.000
1996		1.041		1.029		1.004		1.004		1.008		1.006		1.002		1.003		1.003		1.001		1.002		1.005		1.004		1.004
1997		1.024		1.017		1.025		1.013		1.019		0.984		1.003		1.005		1.007		1.003		1.003		1.015		1.012
1998		1.006		1.044		1.013		1.035		1.041		1.014		0.994		1.002		1.000		0.999		1.000		1.000
1999		1.026		1.015		1.022		0.998		1.000		1.008		1.004		1.004		1.011		1.002		1.000
2000		1.008		1.049		1.029		1.003		1.006		1.009		1.001		1.000		1.000		1.000
2001		1.005		1.010		1.033		1.016		1.008		1.007		1.007		1.014		1.001
2002		1.014		1.010		1.002		1.008		0.993		1.002		1.005		1.004
2003		0.903		1.013		1.016		1.010		1.009		1.017		1.012
2004		0.914		1.014		1.054		0.994		1.009		0.999
2005		N/A		1.045		1.034		1.074		1.047
2006		N/A		0.972		1.174		0.922
2007		N/A		1.201		0.943
2008		0.108		0.931
2009		1.036

** Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.

Average	0.948	1.019	1.023	1.010	1.010	1.005	1.004	1.003	1.002	1.001	1.001	1.002	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Average x 87	0.945	1.020	1.024	1.010	1.011	1.006	1.004	1.003	1.002	1.001	1.001	1.002	1.002	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Average x H/L	0.991	1.015	1.019	1.011	1.009	1.006	1.004	1.003	1.001	1.001	1.001	1.001	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000
Avg L5 x H/L	N/A	1.011	1.035	1.004	1.008	1.006	1.005	1.003	1.003	1.001	1.001	1.002	1.001	1.000	1.000	1.000	1.000	1.000	1.000
Selected	1.010	1.015	1.019	1.011	1.009	1.006	1.004	1.003	1.003	1.001	1.001	1.001	1.001	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000	1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		1.087		1.076		1.060		1.040		1.029		1.020		1.014		1.010		1.007		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		1.111		1.079		1.064		1.045		1.032		1.022		1.016		1.011		1.008		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

WSC Assumed Business
Exhibit B22

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

					(3)
	(1)		(2)		[(1)x(2)]
	Paid ALAE/		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
Accident	Ratio		Factors for		Ratio
Year	@9/30/10		9/10-Ult		@9/30/10
1987&Prior		1.116		1.000		1.116
1988		1.095		1.000		1.095
1989		1.136		1.000		1.136
1990		1.197		1.000		1.197
1991		1.130		1.000		1.130
1992		1.135		1.000		1.135
1993		1.092		1.000		1.092
1994		1.106		1.000		1.106
1995		1.163		1.000		1.163
1996		1.141		1.000		1.141
1997		1.210		1.000		1.210
1998		1.230		1.001		1.231
1999		1.104		1.002		1.106
2000		1.133		1.003		1.137
2001		1.140		1.005		1.146
2002		1.053		1.008		1.062
2003		1.129		1.011		1.142
2004		1.086		1.016		1.103
2005		1.318		1.022		1.347
2006		1.218		1.032		1.257
2007		1.207		1.045		1.262
2008		1.279		1.064		1.361
2009		1.034		1.079		1.116
2010		1.229		1.111		1.365

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Assumed Business
Exhibit B23

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

					Selected						Selected		Ultimate
			Paid ALAE		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident	Paid		To Paid		Losses		Projection		Projection		ALAE*		Ultimate
Year	ALAE		Loss Ratio		($000s)		($000s)		($000s)		($000s)		Loss Ratio
1987&Prior		33,162		0.116		287,360		33,334		33,162		33,162		0.1154
1988		2,403		0.095		25,245		2,398		2,403		2,403		0.0952
1989		3,297		0.136		24,930		3,390		3,297		3,297		0.1323
1990		4,680		0.197		23,786		4,686		4,680		4,680		0.1968
1991		5,033		0.130		38,826		5,047		5,033		5,033		0.1296
1992		8,637		0.135		64,378		8,691		8,637		8,691		0.1350
1993		7,769		0.092		84,686		7,791		7,777		7,791		0.0920
1994		6,105		0.106		58,081		6,157		6,117		6,157		0.1060
1995		3,110		0.163		19,209		3,131		3,122		3,131		0.1630
1996		1,870		0.141		14,353		2,024		1,881		1,953		0.1361
1997		2,710		0.210		13,024		2,735		2,743		2,739		0.2103
1998		3,758		0.231		16,741		3,867		3,833		3,850		0.2300
1999		3,137		0.106		30,758		3,260		3,228		3,244		0.1055
2000		9,692		0.137		73,542		10,075		10,041		10,058		0.1368
2001		7,370		0.146		54,759		7,995		7,746		7,995		0.1460
2002		2,264		0.062		43,708		2,710		2,477		2,594		0.0593
2003		7,794		0.142		63,955		9,082		8,994		9,038		0.1413
2004		2,090		0.103		25,496		2,626		2,615		2,621		0.1028
2005		893		0.347		9,632		3,342		1,254		2,298		0.2386
2006		204		0.257		4,049		1,041		335		688		0.1699
2007		78		0.262		9,644		2,527		171		1,349		0.1399
2008		174		0.361		12,229		4,415		681		2,548		0.2084
2009		179		0.116		20,300		2,355		1,851		2,103		0.1036
2010		30		0.365		12,311		4,494		1,512		2,117		0.1720
Total		116,439				1,031,002		137,173		123,590		129,540		0.1256

* Selected Ultimate ALAE for the 2010 year reflects exposure as of September 30, 2010 and is based on an ALAE to Loss Ratio of 17.2%, which is the weighted average ratio of 2005-2009.

Milliman

WSC Assumed Business
Exhibit B24

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Paid		Ultimate		Unpaid
Accident	ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1987&Prior		33,162		33,162		0
1988		2,403		2,403		0
1989		3,297		3,297		0
1990		4,680		4,680		0
1991		5,033		5,033		0
1992		8,637		8,691		54
1993		7,769		7,791		22
1994		6,105		6,157		52
1995		3,110		3,131		21
1996		1,870		1,953		83
1997		2,710		2,739		29
1998		3,758		3,850		92
1999		3,137		3,244		107
2000		9,692		10,058		366
2001		7,370		7,995		625
2002		2,264		2,594		330
2003		7,794		9,038		1,244
2004		2,090		2,621		531
2005		893		2,298		1,405
2006		204		688		484
2007		78		1,349		1,271
2008		174		2,548		2,374
2009		179		2,103		1,924
2010		30		2,117		2,087
Total		116,439		129,540		13,101

Milliman

WSC Assumed Business
Exhibit B25

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE* ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1987&Prior		320,522		319,018		320,235		1,217		287		1,504
1988		27,648		27,623		27,623		0		25		25
1989		28,227		27,513		28,202		689		25		714
1990		28,466		28,442		28,442		0		24		24
1991		43,859		43,782		43,782		0		77		77
1992		73,069		72,822		72,822		0		247		247
1993		92,477		92,118		92,118		0		359		359
1994		64,238		63,897		63,897		0		341		341
1995		22,340		22,166		22,166		0		174		174
1996		16,306		15,103		16,123		1,020		183		1,203
1997		15,763		15,596		15,631		35		132		167
1998		20,591		20,118		20,350		232		241		473
1999		34,002		33,410		33,590		180		412		592
2000		83,600		82,410		82,434		24		1,166		1,190
2001		62,754		59,904		61,426		1,522		1,328		2,850
2002		46,302		44,816		45,326		510		976		1,486
2003		72,993		68,092		70,618		2,526		2,375		4,901
2004		28,117		26,398		26,988		590		1,129		1,719
2005		11,930		3,700		10,190		6,490		1,740		8,230
2006		4,737		1,140		3,323		2,183		1,414		3,597
2007		10,993		454		521		67		10,472		10,539
2008		14,777		798		1,692		894		13,085		13,979
2009		22,403		5,455		6,343		888		16,060		16,948
2010		14,428		161		222		61		14,206		14,267
Total		1,160,542		1,074,936		1,094,064		19,128		66,478		85,606

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit C1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Accident	Loss Salvage & Subrogation Recovered ($000s)
Year	12			24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		10,493			11,150		12,222		38,857		39,486		42,087		43,318		44,769		44,931		45,014		45,204		45,548		45,663		45,796		45,797		45,841		45,841		45,842		45,850		45,883		45,883		45,883		45,883		45,883
1988		0			25		3,408		3,454		3,560		3,613		3,626		3,758		3,790		3,863		3,874		3,959		3,963		3,966		3,970		3,974		3,977		3,978		3,978		3,978		3,978		3,978		3,978
1989		0			2,112		2,777		2,677		2,282		2,361		2,542		2,546		2,700		2,960		2,994		3,032		3,172		3,173		3,174		3,176		3,177		3,178		3,637		3,639		3,639		3,639
1990		0			452		1,018		1,668		1,979		2,423		2,883		3,372		3,286		4,692		4,763		4,828		4,877		4,953		4,958		5,177		5,177		5,177		5,177		5,177		5,177
1991		102			290		551		914		1,250		1,860		2,121		3,154		3,349		3,478		3,515		3,536		3,652		3,662		3,803		3,858		3,877		3,896		3,918		3,923
1992		45			569		2,805		9,608		11,890		14,461		14,664		15,238		15,240		15,826		16,029		16,106		16,194		16,811		16,811		16,811		16,811		16,811		16,811
1993		3			11,621		31,412		33,781		35,746		37,473		39,645		39,920		40,397		40,793		41,906		41,905		41,908		42,099		42,320		42,320		42,320		42,320
1994		2,532			7,077		13,131		14,831		16,314		16,613		17,078		17,627		18,734		19,991		19,972		19,972		19,972		19,972		19,990		19,990		19,990
1995		7			1,335		2,934		9,116		10,599		10,724		10,824		10,929		11,010		11,585		11,830		11,830		11,830		11,830		11,833		11,833
1996		0			151		562		945		1,330		1,422		1,809		1,831		1,860		1,927		1,927		2,652		2,881		2,941		2,954
1997		(1	)		33		350		1,219		1,410		1,608		3,761		3,758		3,813		4,368		4,368		4,384		4,425		4,443
1998		52			115		1,347		1,582		2,849		2,973		2,969		2,969		2,969		2,969		2,969		3,004		3,004
1999		42			1,680		5,074		5,762		6,784		7,029		7,048		7,475		7,475		7,616		7,837		8,192
2000		72			2,731		5,761		7,888		8,671		9,060		9,543		9,891		10,602		10,874		10,992
2001		80			868		1,716		3,007		4,589		8,399		8,770		9,240		9,533		9,800
2002		0			1,054		1,645		2,395		4,296		4,589		5,083		5,239		5,266
2003		19			3,331		4,662		9,223		9,536		10,610		10,760		10,775
2004		3			5,161		5,170		5,371		5,735		6,490		6,490
2005		0			5		10		427		551		551
2006		0			0		0		0		12
2007		0			1		18		18
2008		0			83		110
2009		0			2,885
2010		0

* Last Diagonal is as of 9/30/10.

Accident	Salvage & Subrogation Recovered Development Factors
Year	12 - 24			24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		1.063			1.096		3.179		1.016		1.066		1.029		1.033		1.004		1.002		1.004		1.008		1.003		1.003		1.000		1.001		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000
1988					136.320		1.013		1.031		1.015		1.004		1.036		1.009		1.019		1.003		1.022		1.001		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1989					1.315		0.964		0.852		1.035		1.077		1.002		1.060		1.096		1.011		1.013		1.046		1.000		1.000		1.001		1.000		1.000		1.144		1.001		1.000		1.000
1990					2.252		1.639		1.186		1.224		1.190		1.170		0.974		1.428		1.015		1.014		1.010		1.016		1.001		1.044		1.000		1.000		1.000		1.000		1.000
1991		2.843			1.900		1.659		1.368		1.488		1.140		1.487		1.062		1.039		1.011		1.006		1.033		1.003		1.039		1.014		1.005		1.005		1.006		1.002
1992		12.644			4.930		3.425		1.238		1.216		1.014		1.039		1.000		1.038		1.013		1.005		1.005		1.038		1.000		1.000		1.000		1.000		1.000
1993		3,873.667			2.703		1.075		1.058		1.048		1.058		1.007		1.012		1.010		1.027		1.000		1.000		1.005		1.005		1.000		1.000		1.000
1994		2.795			1.855		1.129		1.100		1.018		1.028		1.032		1.063		1.067		0.999		1.000		1.000		1.000		1.001		1.000		1.000
1995		190.714			2.198		3.107		1.163		1.012		1.009		1.010		1.007		1.052		1.021		1.000		1.000		1.000		1.000		1.000
1996					3.722		1.681		1.407		1.069		1.272		1.012		1.016		1.036		1.000		1.376		1.086		1.021		1.006
1997		(33.000	)		10.606		3.483		1.157		1.140		2.339		0.999		1.015		1.146		1.000		1.004		1.009		1.005
1998		2.212			11.713		1.174		1.801		1.044		0.999		1.000		1.000		1.000		1.000		1.012		1.000
1999		40.000			3.020		1.136		1.177		1.036		1.003		1.061		1.000		1.019		1.029		1.061
2000		37.931			2.109		1.369		1.099		1.045		1.053		1.036		1.072		1.026		1.014
2001		10.850			1.977		1.752		1.526		1.830		1.044		1.054		1.032		1.038
2002					1.561		1.456		1.794		1.068		1.108		1.031		1.007
2003		175.316			1.400		1.978		1.034		1.113		1.014		1.002
2004		1,720.333			1.002		1.039		1.068		1.132		1.000
2005					2.000		42.700		1.290		1.000
2006
2007					18.000		1.000
2008					1.456
2009
**         Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		464.413			10.149		3.798		1.230		1.137		1.132		1.059		1.021		1.068		1.011		1.040		1.016		1.008		1.005		1.007		1.001		1.001		1.025		1.001		1.000		1.000		1.000		1.000
Average x 87		503.025			10.602		3.831		1.242		1.141		1.138		1.061		1.022		1.072		1.011		1.043		1.017		1.009		1.006		1.008		1.001		1.001		1.030		1.001		1.000		1.000		1.000
Average x H/L		199.700			3.990		1.794		1.218		1.104		1.065		1.035		1.020		1.045		1.010		1.013		1.011		1.006		1.002		1.002		1.000		1.000		1.001		1.000		1.000		1.000
Average L5		N/A			4.771		9.635		1.342		1.229		1.044		1.037		1.022		1.046		1.009		1.091		1.019		1.006		1.002		1.003		1.001		1.001		1.030		1.001
Wtd Average		3.706			1.940		1.582		1.106		1.092		1.050		1.032		1.018		1.034		1.013		1.011		1.005		1.007		1.003		1.002		1.000		1.000		1.006		1.001		1.000		1.000		1.000		1.000
Wtd Average x 87		13.090			2.183		1.350		1.136		1.100		1.056		1.032		1.023		1.045		1.016		1.013		1.006		1.009		1.004		1.003		1.000		1.000		1.015		1.001		1.000		1.000		1.000
Selected		2.695			1.940		1.582		1.242		1.141		1.065		1.035		1.020		1.045		1.016		1.013		1.011		1.007		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		14.607		5.420		2.794		1.766		1.422		1.246		1.170		1.130		1.108		1.060		1.043		1.030		1.019		1.012		1.010		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.000

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		22.441		6.944		3.297		1.981		1.501		1.288		1.189		1.140		1.113		1.072		1.047		1.033		1.022		1.014		1.011		1.009		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.000

Milliman

WSC Assumed Business
Exhibit C2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Loss Salvage & Subrogation Recovered Development Projection Method ($000s)

					(3)
					[(1)*(2)]
					Projected
			(2)		Ultimate
	(1)		Cumulative		Loss
	Salvage		Development		Salvage
Accident	Recovered		Factors		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10
1987 & Prior		45,883		1.000		45,883
1988		3,978		1.001		3,982
1989		3,639		1.002		3,646
1990		5,177		1.003		5,193
1991		3,923		1.004		3,939
1992		16,811		1.005		16,895
1993		42,320		1.006		42,574
1994		19,990		1.007		20,130
1995		11,833		1.009		11,939
1996		2,954		1.011		2,986
1997		4,443		1.014		4,505
1998		3,004		1.022		3,070
1999		8,192		1.033		8,462
2000		10,992		1.047		11,509
2001		9,800		1.072		10,506
2002		5,266		1.113		5,861
2003		10,775		1.140		12,284
2004		6,490		1.189		7,717
2005		551		1.288		710
2006		12		1.501		18
2007		18		1.981		36
2008		110		3.297		363
2009		2,885		6.944		20,033
2010		0		22.441		N/A
Total		219,046				242,241

Note: The 9-Ult Cumulative Development Factor was interpolated using curve fitting methods. The Projected Ultimate Salvage for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit C3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Bornhuetter — Ferguson Projection ($000s)

	2004		2005		2006		2007		2008
1) A Priori Salvage & Subrogation Ratio at 9/30/10*		0.190		0.190		0.190		0.190		0.190
2) Selected Ultimate Losses at 9/30/10		25,496		9,632		4,049		9,644		12,229
3) A Priori Ultimate Salvage & Subrogation at 9/30/10 (1)x (2)		4,844		1,830		769		1,832		2,324
4) Estimated % Unrecovered [1-1/CDF]		0.159		0.224		0.334		0.495		0.697
5) Estimated Future Salvage & Subrogation Recoverable at 9/30/10 (3)x (4)		770		410		257		907		1,620
6) Salvage & Subrogation Recovered to Date		6,490		551		12		18		110
7) Indicated Ultimate Salvage & Subrogation (5) + (6)		7,260		961		269		925		1,730

* Based on the average Salvage & Subrogation Ratios for 1998-2003.

Milliman

WSC Assumed Business
Exhibit C4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		82,189		89,690		98,717		274,102		278,379		281,443		283,002		283,458		283,838		283,680		283,682		283,682		283,748		283,748		283,748		283,868		284,188		284,656		285,068		285,338		285,531		285,621		285,741		285,856
1988		0		509		22,866		24,329		24,409		24,638		24,668		25,000		25,000		25,000		25,000		25,170		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220		25,220
1989		514		18,693		19,888		20,745		21,706		22,134		22,286		22,561		22,561		22,643		23,393		23,905		23,905		23,905		23,905		23,905		23,905		23,905		23,905		23,905		24,005		24,216
1990		3,458		10,279		17,307		20,859		22,261		22,478		22,762		23,075		23,111		23,641		23,720		23,720		23,727		23,727		23,762		23,762		23,762		23,762		23,762		23,762		23,762
1991		4,716		21,423		31,656		34,289		35,028		36,323		37,091		37,633		37,887		38,667		38,699		38,749		38,749		38,749		38,749		38,749		38,749		38,749		38,749		38,749
1992		7,888		25,173		43,822		54,603		61,923		62,221		62,919		63,668		63,865		63,865		63,865		63,865		64,185		64,185		64,185		64,185		64,185		64,185		64,185
1993		2,428		44,409		73,108		78,058		78,401		82,717		83,137		83,630		83,984		83,985		84,120		84,120		84,120		84,270		84,270		84,289		84,289		84,349
1994		3,291		24,287		41,100		46,811		49,651		50,887		55,708		55,917		57,702		57,792		57,792		57,792		57,792		57,792		57,792		57,792		57,792
1995		1,238		12,248		16,724		18,045		18,164		18,461		18,516		18,716		18,828		19,053		19,053		19,053		19,053		19,056		19,056		19,056
1996		5,680		10,177		11,811		12,338		12,716		13,174		13,174		13,239		13,233		13,233		13,233		13,233		13,233		13,233		13,233
1997		4,794		7,606		9,868		10,174		10,843		11,152		12,858		12,858		12,858		12,883		12,886		12,886		12,886		12,886
1998		1,768		9,730		13,494		14,458		14,736		15,539		15,708		16,351		16,360		16,360		16,360		16,360		16,360
1999		5,594		17,449		22,574		24,637		27,806		29,996		30,048		30,258		30,258		30,268		30,268		30,273
2000		5,749		43,826		59,304		67,209		68,951		69,920		72,094		72,686		72,692		72,718		72,718
2001		10,573		28,906		34,899		37,053		42,871		49,030		49,685		50,436		50,369		52,534
2002		3,701		14,033		26,638		32,405		33,688		42,434		42,374		42,453		42,552
2003		1,568		33,124		49,556		54,837		59,367		58,692		59,280		60,298
2004		120		9,256		10,952		19,574		24,023		24,130		24,308
2005		0		1,323		2,483		2,735		2,735		2,807
2006		0		530		1,174		588		936
2007		0		846		273		376
2008		4		398		624
2009		2,929		5,276
2010		131

* Last Diagonal is as of 9/30/10. Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit C5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Losses
Year	12			24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		0.128			0.124		0.124		0.142		0.142		0.150		0.153		0.158		0.158		0.159		0.159		0.161		0.161		0.161		0.161		0.161		0.161		0.161		0.161		0.161		0.161		0.161		0.161		0.161
1988					0.049		0.149		0.142		0.146		0.147		0.147		0.150		0.152		0.155		0.155		0.157		0.157		0.157		0.157		0.158		0.158		0.158		0.158		0.158		0.158		0.158		0.158
1989		0.000			0.113		0.140		0.129		0.105		0.107		0.114		0.113		0.120		0.131		0.128		0.127		0.133		0.133		0.133		0.133		0.133		0.133		0.152		0.152		0.152		0.150
1990		0.000			0.044		0.059		0.080		0.089		0.108		0.127		0.146		0.142		0.198		0.201		0.204		0.206		0.209		0.209		0.218		0.218		0.218		0.218		0.218		0.218
1991		0.022			0.014		0.017		0.027		0.036		0.051		0.057		0.084		0.088		0.090		0.091		0.091		0.094		0.095		0.098		0.100		0.100		0.101		0.101		0.101
1992		0.006			0.023		0.064		0.176		0.192		0.232		0.233		0.239		0.239		0.248		0.251		0.252		0.252		0.262		0.262		0.262		0.262		0.262		0.262
1993		0.001			0.262		0.430		0.433		0.456		0.453		0.477		0.477		0.481		0.486		0.498		0.498		0.498		0.500		0.502		0.502		0.502		0.502
1994		0.769			0.291		0.319		0.317		0.329		0.326		0.307		0.315		0.325		0.346		0.346		0.346		0.346		0.346		0.346		0.346		0.346
1995		0.006			0.109		0.175		0.505		0.584		0.581		0.585		0.584		0.585		0.608		0.621		0.621		0.621		0.621		0.621		0.621
1996		0.000			0.015		0.048		0.077		0.105		0.108		0.137		0.138		0.141		0.146		0.146		0.200		0.218		0.222		0.223
1997		(0.000	)		0.004		0.035		0.120		0.130		0.144		0.293		0.292		0.297		0.339		0.339		0.340		0.343		0.345
1998		0.029			0.012		0.100		0.109		0.193		0.191		0.189		0.182		0.181		0.181		0.181		0.184		0.184
1999		0.008			0.096		0.225		0.234		0.244		0.234		0.235		0.247		0.247		0.252		0.259		0.271
2000		0.013			0.062		0.097		0.117		0.126		0.130		0.132		0.136		0.146		0.150		0.151
2001		0.008			0.030		0.049		0.081		0.107		0.171		0.177		0.183		0.189		0.187
2002		0.000			0.075		0.062		0.074		0.128		0.108		0.120		0.123		0.124
2003		0.012			0.101		0.094		0.168		0.161		0.181		0.182		0.179
2004		0.025			0.558		0.472		0.274		0.239		0.269		0.267
2005					0.004		0.004		0.156		0.201		0.196
2006					0.000		0.000		0.000		0.013
2007					0.001		0.066		0.048
2008		0.000			0.209		0.176
2009		0.000			0.547
2010		0.000

* Last Diagonal is as of 9/30/10. Excludes Dick Corporation in 2005.

Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors
Year	12 - 24			24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		0.974			0.996		1.145		1.001		1.054		1.024		1.032		1.002		1.002		1.004		1.008		1.002		1.003		1.000		1.001		0.999		0.998		0.999		1.000		0.999		1.000		1.000		0.999
1988					3.035		0.953		1.027		1.005		1.002		1.023		1.009		1.019		1.003		1.015		0.999		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1989					1.236		0.924		0.815		1.015		1.069		0.989		1.060		1.092		0.979		0.991		1.046		1.000		1.000		1.001		1.000		1.000		1.144		1.001		0.996		0.988
1990					1.338		1.359		1.112		1.213		1.175		1.154		0.973		1.396		1.012		1.014		1.010		1.016		1.000		1.044		1.000		1.000		1.000		1.000		1.000
1991		0.626			1.286		1.531		1.339		1.435		1.117		1.466		1.055		1.018		1.010		1.005		1.033		1.003		1.039		1.014		1.005		1.005		1.006		1.002
1992		3.962			2.832		2.749		1.091		1.210		1.003		1.027		0.997		1.038		1.013		1.005		1.000		1.038		1.000		1.000		1.000		1.000		1.000
1993		211.787			1.642		1.007		1.054		0.994		1.053		1.001		1.008		1.010		1.026		1.000		1.000		1.003		1.005		1.000		1.000		0.999
1994		0.379			1.096		0.992		1.037		0.994		0.939		1.028		1.030		1.065		0.999		1.000		1.000		1.000		1.001		1.000		1.000
1995		19.277			1.610		2.880		1.155		0.996		1.006		0.999		1.001		1.040		1.021		1.000		1.000		1.000		1.000		1.000
1996					3.207		1.610		1.366		1.032		1.272		1.007		1.016		1.036		1.000		1.376		1.086		1.021		1.006
1997		(20.800	)		8.175		3.378		1.085		1.109		2.029		0.999		1.015		1.143		1.000		1.004		1.009		1.005
1998		0.402			8.446		1.096		1.767		0.990		0.988		0.961		0.999		1.000		1.000		1.012		1.000
1999		12.824			2.335		1.041		1.043		0.960		1.001		1.053		1.000		1.019		1.029		1.061
2000		4.976			1.559		1.208		1.071		1.030		1.022		1.028		1.072		1.025		1.014
2001		3.969			1.637		1.650		1.319		1.600		1.030		1.038		1.033		0.981
2002					0.822		1.197		1.725		0.848		1.109		1.029		1.004
2003		8.299			0.936		1.788		0.955		1.125		1.004		0.979
2004		22.303			0.847		0.581		0.870		1.127		0.990
2005					1.066		38.766		1.290		0.966
2006
2007					55.780		0.653
2008					0.799
2009
*         Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		20.691			4.794		3.325		1.164		1.090		1.102		1.048		1.017		1.059		1.008		1.038		1.016		1.008		1.005		1.007		1.001		1.000		1.025		1.000		0.999		0.996		1.000		0.999
Average x 87		22.334			4.984		3.440		1.173		1.092		1.106		1.049		1.018		1.063		1.008		1.040		1.017		1.009		1.006		1.008		1.001		1.001		1.030		1.001		0.999		0.994		1.000
Average x H/L		7.090			2.321		1.509		1.149		1.074		1.054		1.026		1.016		1.039		1.008		1.011		1.010		1.006		1.002		1.002		1.000		1.000		1.001		1.000		1.000		1.000
Avg L5 x H/L		N/A			0.949		1.212		1.188		1.073		1.019		1.032		1.012		1.015		1.005		1.025		1.003		1.003		1.002		1.000		1.000		1.000		1.002		1.000
Selected		2.695			2.321		1.509		1.149		1.074		1.054		1.026		1.018		1.015		1.008		1.005		1.003		1.006		1.002		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		13.405		4.974		2.143		1.420		1.236		1.151		1.092		1.064		1.045		1.030		1.022		1.017		1.014		1.008		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		20.594		6.373		2.645		1.574		1.280		1.172		1.106		1.071		1.050		1.034		1.024		1.018		1.015		1.010		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit C6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Losses ($000s)

									(5)
									[(3)*(4)]
			(2)		(3)				Projected
			Cumulative		[(1)*(2)]		(4)		Ultimate
			Ratio		Projected		Gross		Loss
	(1)		Development		Ultimate		Ultimate		Salvage
Accident	Ratio		Factors		Ratio		Losses		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1987 & Prior		0.161		1.000		0.161		287,360		46,265
1988		0.158		1.000		0.158		25,245		3,989
1989		0.150		1.000		0.150		24,930		3,740
1990		0.218		1.000		0.218		23,786		5,185
1991		0.101		1.000		0.101		38,826		3,921
1992		0.262		1.001		0.262		64,378		16,867
1993		0.502		1.002		0.503		84,686		42,597
1994		0.346		1.003		0.347		58,081		20,154
1995		0.621		1.005		0.624		19,209		11,986
1996		0.223		1.007		0.225		14,353		3,229
1997		0.345		1.010		0.348		13,024		4,532
1998		0.184		1.015		0.186		16,741		3,114
1999		0.271		1.018		0.275		30,758		8,458
2000		0.151		1.024		0.155		73,542		11,399
2001		0.187		1.034		0.193		54,759		10,568
2002		0.124		1.050		0.130		43,708		5,682
2003		0.179		1.071		0.191		63,955		12,215
2004		0.267		1.106		0.295		25,496		7,521
2005		0.196		1.172		0.230		9,632		2,215
2006		0.013		1.280		0.016		4,049		65
2007		0.048		1.574		0.075		9,644		723
2008		0.176		2.645		0.466		12,229		5,699
2009		0.547		6.373		N/A		20,300		N/A
2010		0.000		20.594		N/A		12,311		N/A
Total								1,031,002		230,124

Milliman

WSC Assumed Business
Exhibit C7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Selection of Ultimate Loss Salvage & Subrogation ($000s)

			Ultimate		Ultimate		Ultimate
			Salvage		Salvage		Salvage				Selected
	Gross		Indicated by		Indicated by		Indicated by				Ultimate
	Ultimate		Dollar		Ratio		Bornhuetter-		Selected		Salvage
Accident	Losses		Development		Development		Ferguson		Ultimate		to Ultimate
Year	@ 9/30/10		Method		Method		Method		Salvage		Loss Ratio
1987 & Prior		287,360		45,883		46,265	xxx			45,883		0.160
1988		25,245		3,982		3,989	xxx			3,982		0.158
1989		24,930		3,646		3,740	xxx			3,646		0.146
1990		23,786		5,193		5,185	xxx			5,193		0.218
1991		38,826		3,939		3,921	xxx			3,930		0.101
1992		64,378		16,895		16,867	xxx			16,895		0.262
1993		84,686		42,574		42,597	xxx			42,597		0.503
1994		58,081		20,130		20,154	xxx			20,154		0.347
1995		19,209		11,939		11,986	xxx			11,986		0.624
1996		14,353		2,986		3,229	xxx			2,986		0.208
1997		13,024		4,505		4,532	xxx			4,532		0.348
1998		16,741		3,070		3,114	xxx			3,092		0.185
1999		30,758		8,462		8,458	xxx			8,458		0.275
2000		73,542		11,509		11,399	xxx			11,399		0.155
2001		54,759		10,506		10,568	xxx			10,568		0.193
2002		43,708		5,861		5,682	xxx			5,682		0.130
2003		63,955		12,284		12,215	xxx			12,215		0.191
2004		25,496		7,717		7,521		7,260		7,260		0.285
2005		9,632		710		2,215		961		961		0.100
2006		4,049		18		65		269		269		0.066
2007		9,644		36		723		925		925		0.096
2008		12,229		363		5,699		1,730		1,730		0.141
2009		20,300		20,033		N/A		6,187		6,187		0.305
2010		12,311		N/A		N/A	xxx			1,748		0.142
Total		1,031,002		242,241		230,124				232,278		0.225

Note: Ultimate Salvage & Subrogation for 2010 is based on an Ultimate Sal/Sub Ratio of 14.2%, which is the weighted average of 2005-2009.

Milliman

WSC Assumed Business
Exhibit C8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS CONTRACT SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Salvage		Indicated
Accident	Ultimate		Recovered		Salvage
Year	Salvage		@ 9/30/10		Recoverable
1987 & Prior		45,883		45,883		0
1988		3,982		3,978		4
1989		3,646		3,639		7
1990		5,193		5,177		16
1991		3,930		3,923		7
1992		16,895		16,811		84
1993		42,597		42,320		277
1994		20,154		19,990		164
1995		11,986		11,833		153
1996		2,986		2,954		32
1997		4,532		4,443		89
1998		3,092		3,004		88
1999		8,458		8,192		266
2000		11,399		10,992		407
2001		10,568		9,800		768
2002		5,682		5,266		416
2003		12,215		10,775		1,440
2004		7,260		6,490		770
2005		961		551		410
2006		269		12		257
2007		925		18		907
2008		1,730		110		1,620
2009		6,187		2,885		3,302
2010		1,748		0		1,748
Total		232,278		219,046		13,232

Milliman

WSC Assumed Business
Exhibit D1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Accident	Reported Claim Counts*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		3,538		3,841		4,059		8,691		8,862		8,965		9,081		9,166		9,185		9,213		9,262		9,280		9,292		9,316		9,321		9,328		9,349		9,351		9,352		9,353		9,353		9,354		9,354		9,355
1988		76		264		655		726		769		830		845		850		865		869		873		875		876		876		877		877		877		877		877		878		878		878		878
1989		89		714		906		993		1,119		1,157		1,181		1,201		1,209		1,212		1,216		1,218		1,219		1,220		1,220		1,221		1,221		1,221		1,221		1,221		1,221		1,221
1990		320		1,058		1,342		1,499		1,570		1,607		1,635		1,642		1,651		1,652		1,655		1,657		1,659		1,660		1,662		1,662		1,662		1,662		1,662		1,662		1,662
1991		355		936		1,177		1,279		1,334		1,369		1,384		1,392		1,396		1,397		1,400		1,404		1,404		1,404		1,404		1,406		1,406		1,406		1,406		1,406
1992		224		561		716		779		859		881		889		897		903		903		905		908		909		909		911		912		912		912		912
1993		176		485		666		784		813		822		833		839		841		848		848		849		849		849		850		850		850		850
1994		183		413		677		731		752		766		769		772		775		780		781		782		782		782		783		783		783
1995		84		326		438		473		498		529		540		552		556		557		558		559		559		561		561		562
1996		168		415		476		521		558		573		578		582		586		588		589		589		589		589		589
1997		184		346		394		444		465		479		483		484		484		486		487		488		488		488
1998		168		330		422		451		471		486		497		499		503		505		505		507		507
1999		142		293		362		399		418		426		430		434		438		440		442		443
2000		141		272		338		366		386		391		402		405		406		409		409
2001		183		377		422		451		470		478		480		482		483		483
2002		192		308		354		364		370		381		383		387		390
2003		98		225		247		256		265		267		272		286
2004		124		173		188		195		201		206		206
2005		49		84		91		100		103		105
2006		41		53		57		66		67
2007		31		54		60		74
2008		45		75		78
2009		41		53
2010		14
*     Last Diagonal is as of 9/30/10.
Accident	Reported Claim Counts Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.086		1.057		2.141		1.020		1.012		1.013		1.009		1.002		1.003		1.005		1.002		1.001		1.003		1.001		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1988		3.474		2.481		1.108		1.059		1.079		1.018		1.006		1.018		1.005		1.005		1.002		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000
1989		8.022		1.269		1.096		1.127		1.034		1.021		1.017		1.007		1.002		1.003		1.002		1.001		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1990		3.306		1.268		1.117		1.047		1.024		1.017		1.004		1.005		1.001		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1991		2.637		1.257		1.087		1.043		1.026		1.011		1.006		1.003		1.001		1.002		1.003		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000
1992		2.504		1.276		1.088		1.103		1.026		1.009		1.009		1.007		1.000		1.002		1.003		1.001		1.000		1.002		1.001		1.000		1.000		1.000
1993		2.756		1.373		1.177		1.037		1.011		1.013		1.007		1.002		1.008		1.000		1.001		1.000		1.000		1.001		1.000		1.000		1.000
1994		2.257		1.639		1.080		1.029		1.019		1.004		1.004		1.004		1.006		1.001		1.001		1.000		1.000		1.001		1.000		1.000
1995		3.881		1.344		1.080		1.053		1.062		1.021		1.022		1.007		1.002		1.002		1.002		1.000		1.004		1.000		1.002
1996		2.470		1.147		1.095		1.071		1.027		1.009		1.007		1.007		1.003		1.002		1.000		1.000		1.000		1.000
1997		1.880		1.139		1.127		1.047		1.030		1.008		1.002		1.000		1.004		1.002		1.002		1.000		1.000
1998		1.964		1.279		1.069		1.044		1.032		1.023		1.004		1.008		1.004		1.000		1.004		1.000
1999		2.063		1.235		1.102		1.048		1.019		1.009		1.009		1.009		1.005		1.005		1.003
2000		1.929		1.243		1.083		1.055		1.013		1.028		1.007		1.002		1.007		1.000
2001		2.060		1.119		1.069		1.042		1.017		1.004		1.004		1.002		1.000
2002		1.604		1.149		1.028		1.016		1.030		1.005		1.010		1.010
2003		2.296		1.098		1.036		1.035		1.008		1.019		1.069
2004		1.395		1.087		1.037		1.031		1.025		1.000
2005		1.714		1.083		1.099		1.030		1.026
2006		1.293		1.075		1.158		1.020
2007		1.742		1.111		1.323
2008		1.667		1.054
2009		1.408
**          Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		2.409		1.263		1.152		1.048		1.027		1.013		1.012		1.006		1.003		1.002		1.002		1.000		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x 87		2.469		1.273		1.103		1.049		1.028		1.013		1.012		1.006		1.003		1.002		1.002		1.000		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		2.205		1.212		1.107		1.045		1.025		1.013		1.008		1.005		1.003		1.002		1.002		1.000		1.000		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		1.596		1.082		1.098		1.027		1.023		1.009		1.009		1.007		1.004		1.001		1.002		1.000		1.000		1.001		1.001		1.000		1.000		1.000		1.000
Wtd Average		1.753		1.217		1.399		1.040		1.021		1.013		1.009		1.004		1.003		1.004		1.002		1.001		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
WA x 1987		2.511		1.297		1.097		1.056		1.029		1.014		1.009		1.006		1.003		1.002		1.002		1.001		1.000		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		1.564		1.082		1.083		1.026		1.020		1.012		1.016		1.006		1.004		1.002		1.002		1.000		1.001		1.001		1.001		1.000		1.000		1.000		1.000
Selected		1.753		1.100		1.083		1.026		1.020		1.012		1.009		1.006		1.003		1.002		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		2.270		1.295		1.177		1.087		1.059		1.038		1.026		1.017		1.011		1.008		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		2.758		1.490		1.205		1.109		1.066		1.043		1.029		1.019		1.013		1.009		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit D2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Reported Claim Projection

																			Indicated
							Cumulative Reported						Indicated Ultimate						Ultimate
Accident	Reported Claim Counts						Development Factors						Reported Claims						Reported
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Claims
1987&Prior		9,354		9,354		9,355		1.000		1.000		1.000		9,354		9,354		9,355		9,355
1988		878		878		878		1.000		1.000		1.000		878		878		878		878
1989		1,221		1,221		1,221		1.000		1.000		1.000		1,221		1,221		1,221		1,221
1990		1,662		1,662		1,662		1.000		1.000		1.000		1,662		1,662		1,662		1,662
1991		1,406		1,406		1,406		1.000		1.000		1.000		1,406		1,406		1,406		1,406
1992		912		912		912		1.000		1.000		1.000		912		912		912		912
1993		850		850		850		1.000		1.000		1.000		850		850		850		850
1994		783		783		783		1.001		1.000		1.000		784		783		783		783
1995		561		561		562		1.002		1.001		1.000		562		562		562		562
1996		589		589		589		1.003		1.002		1.001		591		590		590		590
1997		488		488		488		1.004		1.003		1.002		490		489		489		489
1998		505		507		507		1.006		1.004		1.003		508		509		509		509
1999		440		442		443		1.008		1.006		1.005		444		445		445		445
2000		406		409		409		1.011		1.008		1.007		410		412		412		412
2001		482		483		483		1.017		1.011		1.009		490		488		487		487
2002		383		387		390		1.026		1.017		1.013		393		394		395		395
2003		267		272		286		1.038		1.026		1.019		277		279		291		291
2004		201		206		206		1.059		1.038		1.029		213		214		212		212
2005		100		103		105		1.087		1.059		1.043		109		109		110		110
2006		57		66		67		1.177		1.087		1.066		67		72		71		71
2007		54		60		74		1.295		1.177		1.109		70		71		82		82
2008		45		75		78		2.270		1.295		1.205		102		97		94		94
2009				41		53				2.270		1.490				93		79		79
2010						14						2.758						39		29

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods.

The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit D3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Accident	Closed Claim Counts*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		3,042		3,423		3,617		8,078		8,432		8,636		8,818		8,947		9,027		9,067		9,089		9,156		9,177		9,187		9,195		9,198		9,227		9,240		9,260		9,266		9,272		9,273		9,274		9,275
1988		12		86		440		603		688		742		812		812		842		857		865		868		869		871		871		872		872		873		873		875		876		878		878
1989		13		354		679		855		965		1,079		1,117		1,155		1,171		1,192		1,197		1,203		1,205		1,208		1,214		1,216		1,217		1,218		1,220		1,221		1,221		1,221
1990		100		524		974		1,273		1,434		1,500		1,567		1,597		1,625		1,629		1,636		1,638		1,641		1,651		1,654		1,655		1,657		1,660		1,659		1,660		1,660
1991		146		555		956		1,158		1,223		1,263		1,312		1,345		1,367		1,376		1,385		1,385		1,394		1,395		1,395		1,396		1,400		1,399		1,401		1,401
1992		97		366		578		668		751		807		862		876		884		886		892		904		906		907		909		909		910		911		911
1993		62		266		406		627		701		778		802		824		827		828		834		836		838		841		845		846		846		847
1994		95		186		448		572		686		717		734		741		747		759		762		763		765		772		774		777		777
1995		41		148		260		373		427		453		475		488		528		538		541		551		556		558		559		559
1996		64		195		357		446		488		508		521		555		566		567		574		577		579		582		583
1997		56		199		285		341		365		377		441		452		458		473		478		482		485		486
1998		48		171		266		304		345		426		454		464		471		483		489		493		495
1999		36		131		200		232		332		372		381		394		408		414		420		423
2000		30		89		142		231		288		304		331		360		369		388		394
2001		24		109		179		304		324		370		437		449		457		459
2002		44		107		190		215		250		273		292		339		344
2003		19		89		130		166		200		213		231		233
2004		27		73		108		148		165		179		184
2005		12		39		59		67		82		86
2006		9		25		36		40		48
2007		5		12		27		39
2008		8		23		30
2009		7		19
2010		0
*     Last Diagonal is as of 9/30/10.
Accident	Closed Claim Counts Development Factors
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.125		1.057		2.233		1.044		1.024		1.021		1.015		1.009		1.004		1.002		1.007		1.002		1.001		1.001		1.000		1.003		1.001		1.002		1.001		1.001		1.000		1.000		1.000
1988		7.167		5.116		1.370		1.141		1.078		1.094		1.000		1.037		1.018		1.009		1.003		1.001		1.002		1.000		1.001		1.000		1.001		1.000		1.002		1.001		1.002		1.000
1989		27.231		1.918		1.259		1.129		1.118		1.035		1.034		1.014		1.018		1.004		1.005		1.002		1.002		1.005		1.002		1.001		1.001		1.002		1.001		1.000		1.000
1990		5.240		1.859		1.307		1.126		1.046		1.045		1.019		1.018		1.002		1.004		1.001		1.002		1.006		1.002		1.001		1.001		1.002		0.999		1.001		1.000
1991		3.801		1.723		1.211		1.056		1.033		1.039		1.025		1.016		1.007		1.007		1.000		1.006		1.001		1.000		1.001		1.003		0.999		1.001		1.000
1992		3.773		1.579		1.156		1.124		1.075		1.068		1.016		1.009		1.002		1.007		1.013		1.002		1.001		1.002		1.000		1.001		1.001		1.000
1993		4.290		1.526		1.544		1.118		1.110		1.031		1.027		1.004		1.001		1.007		1.002		1.002		1.004		1.005		1.001		1.000		1.002
1994		1.958		2.409		1.277		1.199		1.045		1.024		1.010		1.008		1.016		1.004		1.001		1.003		1.009		1.003		1.004		1.000
1995		3.610		1.757		1.435		1.145		1.061		1.049		1.027		1.082		1.019		1.006		1.018		1.009		1.004		1.002		1.000
1996		3.047		1.831		1.249		1.094		1.041		1.026		1.065		1.020		1.002		1.012		1.005		1.003		1.005		1.002
1997		3.554		1.432		1.196		1.070		1.033		1.170		1.025		1.013		1.033		1.011		1.008		1.006		1.003
1998		3.563		1.556		1.143		1.135		1.235		1.066		1.022		1.015		1.025		1.012		1.008		1.005
1999		3.639		1.527		1.160		1.431		1.120		1.024		1.034		1.036		1.015		1.014		1.010
2000		2.967		1.596		1.627		1.247		1.056		1.089		1.088		1.025		1.051		1.021
2001		4.542		1.642		1.698		1.066		1.142		1.181		1.027		1.018		1.006
2002		2.432		1.776		1.132		1.163		1.092		1.070		1.161		1.020
2003		4.684		1.461		1.277		1.205		1.065		1.085		1.012
2004		2.704		1.479		1.370		1.115		1.085		1.037
2005		3.250		1.513		1.136		1.224		1.066
2006		2.778		1.440		1.111		1.275
2007		2.400		2.250		1.633
2008		2.875		1.425
2009		3.786
**          Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		4.540		1.812		1.358		1.155		1.080		1.064		1.036		1.021		1.015		1.009		1.006		1.004		1.003		1.002		1.001		1.001		1.001		1.001		1.001		1.000		1.001		1.000		1.000
Average x 87		4.695		1.848		1.315		1.161		1.083		1.067		1.037		1.022		1.015		1.009		1.006		1.004		1.004		1.002		1.001		1.001		1.001		1.000		1.001		1.000		1.001		1.000
Average x H/L		3.622		1.685		1.325		1.146		1.074		1.059		1.030		1.018		1.013		1.008		1.006		1.003		1.003		1.002		1.001		1.001		1.001		1.001		1.001		1.000		1.000
Avg L5 x H/L		2.968		1.477		1.261		1.197		1.081		1.081		1.050		1.021		1.024		1.013		1.009		1.005		1.004		1.002		1.001		1.001		1.001		1.000		1.001
Wtd Average		1.800		1.446		1.620		1.090		1.052		1.041		1.023		1.015		1.009		1.005		1.006		1.003		1.002		1.002		1.001		1.002		1.001		1.002		1.001		1.001		1.000		1.000		1.000
WA x 1987		3.951		1.802		1.290		1.132		1.076		1.057		1.029		1.020		1.012		1.008		1.005		1.003		1.004		1.002		1.001		1.001		1.001		1.000		1.001		1.000		1.001		1.000
Wtd Avg L5		3.061		1.528		1.292		1.176		1.099		1.103		1.062		1.022		1.025		1.014		1.010		1.005		1.005		1.003		1.001		1.001		1.001		1.000		1.001
Selected		3.951		1.477		1.261		1.197		1.081		1.081		1.050		1.022		1.025		1.008		1.005		1.003		1.003		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		11.644		2.947		1.995		1.582		1.322		1.223		1.131		1.077		1.054		1.028		1.020		1.015		1.012		1.009		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		17.976		4.155		2.199		1.676		1.383		1.247		1.153		1.090		1.060		1.034		1.022		1.016		1.013		1.010		1.008		1.006		1.005		1.004		1.003		1.002		1.001		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit D4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Closed Claim Projection

																			Indicated
							Cumulative Closed						Indicated Ultimate						Ultimate
Accident	Closed Claim Counts						Development Factors						Closed Claims						Closed
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Claims
1987&Prior		9,273		9,274		9,275		1.000		1.000		1.000		9,273		9,274		9,275		9,275
1988		876		878		878		1.001		1.000		1.000		877		878		878		878
1989		1,221		1,221		1,221		1.002		1.001		1.000		1,223		1,222		1,221		1,221
1990		1,659		1,660		1,660		1.003		1.002		1.001		1,664		1,663		1,662		1,662
1991		1,399		1,401		1,401		1.004		1.003		1.002		1,405		1,405		1,404		1,404
1992		910		911		911		1.005		1.004		1.003		915		915		914		914
1993		846		846		847		1.006		1.005		1.004		851		850		850		850
1994		774		777		777		1.007		1.006		1.005		779		782		781		781
1995		558		559		559		1.009		1.007		1.006		563		563		562		562
1996		579		582		583		1.012		1.009		1.008		586		587		588		588
1997		482		485		486		1.015		1.012		1.010		489		491		491		491
1998		489		493		495		1.020		1.015		1.013		499		500		501		501
1999		414		420		423		1.028		1.020		1.016		426		428		430		430
2000		369		388		394		1.054		1.028		1.022		389		399		403		403
2001		449		457		459		1.077		1.054		1.034		484		482		475		475
2002		292		339		344		1.131		1.077		1.060		330		365		365		365
2003		213		231		233		1.223		1.131		1.090		260		261		254		254
2004		165		179		184		1.322		1.223		1.153		218		219		212		212
2005		67		82		86		1.582		1.322		1.247		106		108		107		107
2006		36		40		48		1.995		1.582		1.383		72		63		66		66
2007		12		27		39		2.947		1.995		1.676		35		54		65		65
2008		8		23		30		11.644		2.947		2.199		93		68		66		66
2009				7		19				11.644		4.155				82		79		79
2010						0						17.976						0		0

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods.

The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit D5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Selection of Ultimate Reported Claims

			Indicated Ultimate Reported Claims*						Selected
	Reported		Based on		Based on		Based on		Ultimate
Accident	Claims		Reported Claim		Closed Claim		Rptd Claim BF		Reported
Year	@9/30/10		Projection		Projection		Projection		Claims
1987&Prior		9,355		9,355		9,275		N/A		9,355
1988		878		878		878		N/A		878
1989		1,221		1,221		1,221		N/A		1,221
1990		1,662		1,662		1,662		N/A		1,662
1991		1,406		1,406		1,404		N/A		1,406
1992		912		912		914		N/A		912
1993		850		850		850		N/A		850
1994		783		783		781		N/A		783
1995		562		562		562		N/A		562
1996		589		590		588		N/A		590
1997		488		489		491		N/A		489
1998		507		509		501		N/A		509
1999		443		445		430		N/A		445
2000		409		412		403		N/A		412
2001		483		487		475		N/A		487
2002		390		395		365		N/A		395
2003		286		291		254		N/A		291
2004		206		212		212		N/A		212
2005		105		110		107		N/A		110
2006		67		71		66		N/A		71
2007		74		82		65		N/A		82
2008		78		94		66		N/A		94
2009		53		79		79		N/A		79
2010		14		29		0		43		43
Total		21,821		21,924		21,649				21,938

* Projection methods for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Assumed Business
Exhibit D6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Summary of Claims Diagnostics

												Selected
	Reported		CWI			Outstanding		Incurred		Closed		Ultimate
Accident	Claims		Claims			Claims		Claims		Claims		Reported
Year	@9/30/10		@9/30/10			@9/30/10		@9/30/10		@9/30/10		Claims
1987&Prior		9,355		5,047			80		5,127		9,275		9,355
1988		878		457			0		457		878		878
1989		1,221		713			0		713		1,221		1,221
1990		1,662		938			2		940		1,660		1,662
1991		1,406		855			5		860		1,401		1,406
1992		912		536			1		537		911		912
1993		850		493			3		496		847		850
1994		783		420			6		426		777		783
1995		562		300			3		303		559		562
1996		589		300			6		306		583		590
1997		488		203			2		205		486		489
1998		507		214			12		226		495		509
1999		443		186			20		206		423		445
2000		409		185			15		200		394		412
2001		483		166			24		190		459		487
2002		390		110			46		156		344		395
2003		286		81			53		134		233		291
2004		206		53			22		75		184		212
2005		105		26			19		45		86		110
2006		67		13			19		32		48		71
2007		74		10			35		45		39		82
2008		78		4			48		52		30		94
2009		53		(2	)		34		32		19		79
2010		14		0			14		14		0		43
Total		21,821		11,308			469		11,777		21,352		21,938

Milliman

     WSC Assumed Business
Exhibit E1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		33,547		36,740		38,345		60,605		62,260		63,330		68,566		69,295		70,073		70,375		71,414		71,946		73,367		73,721		74,242		75,139		76,640		78,264		79,942		81,399		82,860		83,917		85,459		86,236
1988		180		685		2,380		3,023		3,585		3,775		3,972		3,985		4,417		4,460		4,471		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,507		4,507		4,507
1989		147		2,779		3,839		4,373		6,057		7,730		7,913		8,055		8,174		8,247		8,250		8,274		8,301		8,301		8,301		8,301		8,301		8,301		8,301		8,301		8,301		8,301
1990		7,010		10,105		11,379		13,075		16,945		17,351		17,638		17,668		17,724		17,724		17,728		17,847		17,858		17,858		17,858		17,858		17,859		17,859		17,859		17,859		17,859
1991		634		2,579		3,385		4,473		10,029		10,148		10,210		10,294		10,417		10,417		10,423		10,459		10,459		10,459		10,459		10,460		10,460		10,460		10,460		10,460
1992		275		1,585		2,095		2,462		2,728		2,922		3,051		3,080		3,471		3,471		3,471		3,472		3,482		3,482		3,483		3,570		3,570		3,570		3,570
1993		3,379		1,747		2,448		3,116		3,211		3,274		3,280		3,287		3,424		3,521		3,536		3,575		3,640		3,704		3,729		3,729		3,729		3,729
1994		287		1,051		2,015		2,679		2,765		3,015		3,175		3,198		3,205		3,219		3,228		3,228		3,229		3,229		3,229		3,229		3,229
1995		78		1,014		1,778		2,010		2,232		2,518		2,697		2,793		2,810		2,814		2,816		2,830		2,830		2,830		2,830		2,830
1996		652		3,087		4,469		4,932		5,426		5,515		5,754		6,379		6,436		6,439		6,439		6,439		6,439		6,439		6,455
1997		384		966		1,245		1,795		1,862		2,209		2,554		2,586		2,586		2,589		2,596		2,596		2,596		2,596
1998		498		5,716		6,264		6,408		6,678		7,062		7,110		7,154		7,254		7,256		7,259		7,266		7,266
1999		6,427		23,407		24,710		24,965		25,251		25,074		24,855		25,483		25,222		23,526		22,293		22,291
2000		11,960		17,664		16,806		22,501		24,430		24,520		24,474		24,554		24,554		24,554		24,562
2001		2,410		2,152		4,596		11,265		13,550		13,577		19,854		19,878		19,882		19,896
2002		921		2,468		2,400		2,399		2,404		2,325		2,249		2,189		2,222
2003		20,004		21,876		23,269		25,700		26,819		27,319		27,320		27,358
2004		245		1,087		1,511		1,950		1,981		2,062		2,066
2005		57		1,016		1,542		1,779		1,871		1,876
2006		108		338		658		678		761
2007		86		220		402		493
2008		114		299		312
2009		14		51
2010		6
*     Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009. Last Diagonal is as of 9/30/10.
Accident	Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.095		1.044		1.581		1.027		1.017		1.083		1.011		1.011		1.004		1.015		1.007		1.020		1.005		1.007		1.012		1.020		1.021		1.021		1.018		1.018		1.013		1.018		1.012
1988		3.806		3.474		1.270		1.186		1.053		1.052		1.003		1.108		1.010		1.002		1.008		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		18.905		1.381		1.139		1.385		1.276		1.024		1.018		1.015		1.009		1.000		1.003		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.442		1.126		1.149		1.296		1.024		1.017		1.002		1.003		1.000		1.000		1.007		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		4.068		1.313		1.321		2.242		1.012		1.006		1.008		1.012		1.000		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		5.764		1.322		1.175		1.108		1.071		1.044		1.010		1.127		1.000		1.000		1.000		1.003		1.000		1.000		1.025		1.000		1.000		1.000
1993		0.517		1.401		1.273		1.030		1.020		1.002		1.002		1.042		1.028		1.004		1.011		1.018		1.018		1.007		1.000		1.000		1.000
1994		3.662		1.917		1.330		1.032		1.090		1.053		1.007		1.002		1.004		1.003		1.000		1.000		1.000		1.000		1.000		1.000
1995		13.000		1.753		1.130		1.110		1.128		1.071		1.036		1.006		1.001		1.001		1.005		1.000		1.000		1.000		1.000
1996		4.735		1.448		1.104		1.100		1.016		1.043		1.109		1.009		1.000		1.000		1.000		1.000		1.000		1.003
1997		2.516		1.289		1.442		1.037		1.186		1.156		1.013		1.000		1.001		1.003		1.000		1.000		1.000
1998		11.478		1.096		1.023		1.042		1.058		1.007		1.006		1.014		1.000		1.000		1.001		1.000
1999		3.642		1.056		1.010		1.011		0.993		0.991		1.025		0.990		0.933		0.948		1.000
2000		1.477		0.951		1.339		1.086		1.004		0.998		1.003		1.000		1.000		1.000
2001		0.893		2.136		2.451		1.203		1.002		1.462		1.001		1.000		1.001
2002		2.680		0.972		1.000		1.002		0.967		0.967		0.973		1.020
2003		1.094		1.064		1.104		1.044		1.019		1.000		1.002
2004		4.437		1.390		1.291		1.016		1.041		1.003
2005		17.825		1.518		1.154		1.052		1.004
2006		3.130		1.947		1.030		1.166
2007		2.558		1.827		1.313
2008		2.623		1.058
2009		5.605
**          Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		5.085		1.477		1.268		1.159		1.052		1.054		1.013		1.022		1.000		0.998		1.003		1.004		1.002		1.002		1.004		1.003		1.003		1.004		1.004		1.005		1.004		1.009		1.012
Average x 87		5.266		1.497		1.252		1.166		1.054		1.053		1.014		1.023		0.999		0.997		1.003		1.002		1.002		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		4.644		1.403		1.220		1.107		1.043		1.034		1.010		1.017		1.002		1.001		1.003		1.003		1.001		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		3.786		1.578		1.183		1.037		1.008		1.000		1.002		1.005		1.000		1.000		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Average		1.551		1.125		1.290		1.103		1.025		1.058		1.011		1.010		0.995		0.999		1.005		1.011		1.003		1.004		1.008		1.012		1.013		1.014		1.012		1.013		1.011		1.017		1.012
WA x 1987		1.824		1.154		1.196		1.136		1.028		1.048		1.011		1.009		0.990		0.990		1.003		1.002		1.001		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		5.149		1.496		1.119		1.042		1.011		1.088		1.007		0.999		0.979		0.981		1.000		1.000		1.003		1.002		1.004		1.000		1.000		1.000		1.012
Selected		4.644		1.403		1.220		1.136		1.028		1.034		1.011		1.010		1.006		1.005		1.004		1.003		1.002		1.002		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		10.231		2.203		1.570		1.287		1.133		1.102		1.066		1.054		1.044		1.038		1.033		1.029		1.026		1.024		1.022		1.020		1.018		1.016		1.015		1.014		1.013		1.012		1.011		1.010
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		16.023		3.234		1.709		1.353		1.170		1.110		1.075		1.057		1.047		1.040		1.034		1.030		1.027		1.025		1.023		1.021		1.019		1.017		1.015		1.014		1.013		1.012		1.011		1.010

Milliman

     WSC Assumed Business
Exhibit E2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection*

																			Indicated
							Cumulative												Ultimate
Accident	Paid Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		83,917		85,459		86,236		1.012		1.011		1.010		84,924		86,399		87,098		87,098
1988		4,507		4,507		4,507		1.013		1.012		1.011		4,566		4,561		4,557		4,557
1989		8,301		8,301		8,301		1.014		1.013		1.012		8,417		8,409		8,401		8,401
1990		17,859		17,859		17,859		1.015		1.014		1.013		18,127		18,109		18,091		18,091
1991		10,460		10,460		10,460		1.016		1.015		1.014		10,627		10,617		10,606		10,606
1992		3,570		3,570		3,570		1.018		1.016		1.015		3,634		3,627		3,624		3,624
1993		3,729		3,729		3,729		1.020		1.018		1.017		3,804		3,796		3,792		3,792
1994		3,229		3,229		3,229		1.022		1.020		1.019		3,300		3,294		3,290		3,290
1995		2,830		2,830		2,830		1.024		1.022		1.021		2,898		2,892		2,889		2,889
1996		6,439		6,439		6,455		1.026		1.024		1.023		6,606		6,594		6,603		6,603
1997		2,596		2,596		2,596		1.029		1.026		1.025		2,671		2,663		2,661		2,661
1998		7,259		7,266		7,266		1.033		1.029		1.027		7,499		7,477		7,462		7,462
1999		23,526		22,293		22,291		1.038		1.033		1.030		24,420		23,029		22,960		22,960
2000		24,554		24,554		24,562		1.044		1.038		1.034		25,634		25,487		25,397		25,397
2001		19,878		19,882		19,896		1.054		1.044		1.040		20,951		20,757		20,692		20,692
2002		2,249		2,189		2,222		1.066		1.054		1.047		2,397		2,307		2,326		2,326
2003		27,319		27,320		27,358		1.102		1.066		1.057		30,106		29,123		28,917		28,917
2004		1,981		2,062		2,066		1.133		1.102		1.075		2,244		2,272		2,221		2,221
2005		1,779		1,871		1,876		1.287		1.133		1.110		2,290		2,120		2,082		2,082
2006		658		678		761		1.570		1.287		1.170		1,033		873		890		890
2007		220		402		493		2.203		1.570		1.353		485		631		667		667
2008		114		299		312		10.231		2.203		1.709		1,166		659		533		533
2009				14		51				10.231		3.234				143		165		165
2010						6						16.023						96		72

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
Note:	The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods.
	The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

     WSC Assumed Business
Exhibit E3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Incurred Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		37,312		39,842		47,243		71,015		72,193		72,097		72,425		73,987		74,521		72,029		73,245		74,845		75,227		75,380		75,616		76,492		90,878		90,999		91,413		92,709		92,789		92,824		93,055		93,068
1988		375		988		3,594		3,296		3,715		3,867		4,536		5,479		4,444		4,484		4,481		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,507		4,507		4,507		4,507
1989		288		3,232		4,087		4,684		8,691		8,065		8,184		8,170		8,232		8,249		8,558		8,581		8,309		8,309		8,309		8,301		8,301		8,301		8,301		8,301		8,301		8,301
1990		7,949		12,796		13,698		15,602		18,178		18,162		17,784		17,738		17,835		17,837		17,729		17,848		17,859		17,859		17,859		17,859		17,859		17,859		17,859		17,859		17,859
1991		1,366		3,033		3,629		4,565		10,083		10,257		10,286		10,369		10,422		10,417		10,423		10,459		10,459		10,459		10,459		10,460		10,460		10,460		10,460		10,460
1992		585		1,790		2,392		2,655		2,989		3,020		3,175		3,193		3,474		3,474		3,474		3,472		3,482		3,482		3,483		3,570		3,570		3,570		3,570
1993		3,484		2,117		2,755		3,226		3,312		3,311		3,343		3,292		3,443		3,605		3,613		3,678		3,704		3,704		3,729		3,729		3,729		3,729
1994		601		1,827		2,597		2,740		2,840		3,337		3,245		3,199		3,206		3,219		3,228		3,228		3,229		3,229		3,229		3,229		3,229
1995		220		1,194		2,130		2,226		2,473		2,726		2,784		2,836		2,860		2,820		2,832		2,834		2,830		2,830		2,830		2,830
1996		748		4,633		4,728		5,056		5,493		5,588		5,755		6,379		6,436		6,439		6,439		6,439		6,614		6,439		6,455
1997		998		2,044		1,866		1,938		1,976		2,324		2,647		2,617		2,589		2,589		2,596		2,596		2,596		2,596
1998		2,951		14,299		9,326		9,457		9,732		10,597		10,799		10,794		10,801		10,801		7,798		7,818		7,806
1999		6,869		21,074		24,806		25,209		25,311		25,129		24,867		25,483		25,322		23,576		22,343		22,341
2000		19,027		22,359		23,537		24,511		24,507		24,555		24,572		24,558		24,559		24,554		24,562
2001		23,387		24,671		22,800		23,581		22,627		22,635		19,923		19,947		19,951		19,966
2002		1,395		2,747		2,858		2,483		2,484		2,232		2,078		2,019		2,261
2003		21,545		22,582		25,626		26,303		27,757		27,381		27,320		27,359
2004		1,285		2,275		5,556		5,738		4,364		2,222		2,207
2005		355		1,645		1,852		1,872		1,871		1,884
2006		655		719		692		752		801
2007		86		220		434		499
2008		134		320		337
2009		14		51
2010		7
*     Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009. Last Diagonal is as of 9/30/10.
Accident	Incurred Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.068		1.186		1.503		1.017		0.999		1.005		1.022		1.007		0.967		1.017		1.022		1.005		1.002		1.003		1.012		1.188		1.001		1.005		1.014		1.001		1.000		1.002		1.000
1988		2.635		3.638		0.917		1.127		1.041		1.173		1.208		0.811		1.009		0.999		1.006		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		11.222		1.265		1.146		1.855		0.928		1.015		0.998		1.008		1.002		1.037		1.003		0.968		1.000		1.000		0.999		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.610		1.070		1.139		1.165		0.999		0.979		0.997		1.005		1.000		0.994		1.007		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		2.220		1.197		1.258		2.209		1.017		1.003		1.008		1.005		1.000		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		3.060		1.336		1.110		1.126		1.010		1.051		1.006		1.088		1.000		1.000		0.999		1.003		1.000		1.000		1.025		1.000		1.000		1.000
1993		0.608		1.301		1.171		1.027		1.000		1.010		0.985		1.046		1.047		1.002		1.018		1.007		1.000		1.007		1.000		1.000		1.000
1994		3.040		1.421		1.055		1.036		1.175		0.972		0.986		1.002		1.004		1.003		1.000		1.000		1.000		1.000		1.000		1.000
1995		5.427		1.784		1.045		1.111		1.102		1.021		1.019		1.008		0.986		1.004		1.001		0.999		1.000		1.000		1.000
1996		6.194		1.021		1.069		1.086		1.017		1.030		1.108		1.009		1.000		1.000		1.000		1.027		0.974		1.003
1997		2.048		0.913		1.039		1.020		1.176		1.139		0.989		0.989		1.000		1.003		1.000		1.000		1.000
1998		4.845		0.652		1.014		1.029		1.089		1.019		1.000		1.001		1.000		0.722		1.003		0.998
1999		3.068		1.177		1.016		1.004		0.993		0.990		1.025		0.994		0.931		0.948		1.000
2000		1.175		1.053		1.041		1.000		1.002		1.001		0.999		1.000		1.000		1.000
2001		1.055		0.924		1.034		0.960		1.000		0.880		1.001		1.000		1.001
2002		1.969		1.040		0.869		1.000		0.899		0.931		0.972		1.163
2003		1.048		1.135		1.026		1.055		0.986		0.998		1.002
2004		1.770		2.442		1.033		0.761		0.509		0.991
2005		4.634		1.126		1.011		0.999		1.009
2006		1.098		0.962		1.087		1.088
2007		2.558		1.973		1.205
2008		2.388		1.071
2009		5.605
**          Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		3.059		1.349		1.085		1.134		0.997		1.012		1.019		1.009		0.996		0.981		1.005		1.001		0.998		1.001		1.004		1.024		1.000		1.001		1.003		1.000		1.000		1.001		1.000
Average x 87		3.149		1.357		1.064		1.140		0.997		1.012		1.019		1.009		0.999		0.978		1.003		1.000		0.997		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		2.786		1.270		1.075		1.095		1.016		1.010		1.010		1.012		0.998		0.998		1.004		1.001		1.000		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		3.193		1.390		1.049		1.018		0.962		0.973		1.001		1.000		1.000		0.983		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Average		1.417		1.108		1.151		1.061		0.995		0.994		1.015		1.002		0.982		0.986		1.011		1.002		1.000		1.002		1.007		1.112		1.001		1.003		1.010		1.001		1.000		1.002		1.000
WA x 1987		1.555		1.087		1.047		1.080		0.994		0.989		1.013		0.999		0.989		0.967		1.003		0.999		0.997		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		2.397		1.714		1.030		1.004		0.954		0.963		1.006		1.002		0.979		0.938		1.000		1.007		0.991		1.002		1.004		1.000		1.000		1.000		1.010
Selected		2.397		1.390		1.049		1.025		1.000		1.000		1.010		1.009		1.005		1.005		1.004		1.003		1.002		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		3.778		1.576		1.134		1.081		1.055		1.055		1.055		1.045		1.036		1.031		1.026		1.022		1.019		1.017		1.015		1.013		1.011		1.010		1.009		1.008		1.007		1.006		1.005		1.005
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		5.029		1.961		1.231		1.094		1.062		1.055		1.055		1.048		1.038		1.032		1.027		1.023		1.020		1.018		1.016		1.014		1.012		1.010		1.009		1.008		1.007		1.006		1.005		1.005

Milliman

WSC Assumed Business
Exhibit E4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection*

																			Indicated
							Cumulative												Ultimate
Accident	Incurred Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		92,824		93,055		93,068		1.006		1.005		1.005		93,381		93,520		93,533		93,533
1988		4,507		4,507		4,507		1.007		1.006		1.005		4,539		4,534		4,530		4,530
1989		8,301		8,301		8,301		1.008		1.007		1.006		8,367		8,359		8,351		8,351
1990		17,859		17,859		17,859		1.009		1.008		1.007		18,020		18,002		17,984		17,984
1991		10,460		10,460		10,460		1.010		1.009		1.008		10,565		10,554		10,544		10,544
1992		3,570		3,570		3,570		1.011		1.010		1.009		3,609		3,606		3,602		3,602
1993		3,729		3,729		3,729		1.013		1.011		1.010		3,777		3,770		3,766		3,766
1994		3,229		3,229		3,229		1.015		1.013		1.012		3,277		3,271		3,268		3,268
1995		2,830		2,830		2,830		1.017		1.015		1.014		2,878		2,872		2,870		2,870
1996		6,614		6,439		6,455		1.019		1.017		1.016		6,740		6,548		6,558		6,558
1997		2,596		2,596		2,596		1.022		1.019		1.018		2,653		2,645		2,643		2,643
1998		7,798		7,818		7,806		1.026		1.022		1.020		8,001		7,990		7,962		7,962
1999		23,576		22,343		22,341		1.031		1.026		1.023		24,307		22,924		22,855		22,855
2000		24,559		24,554		24,562		1.036		1.031		1.027		25,443		25,315		25,225		25,225
2001		19,947		19,951		19,966		1.045		1.036		1.032		20,845		20,669		20,605		20,605
2002		2,078		2,019		2,261		1.055		1.045		1.038		2,192		2,110		2,347		2,347
2003		27,381		27,320		27,359		1.055		1.055		1.048		28,887		28,823		28,672		28,672
2004		4,364		2,222		2,207		1.055		1.055		1.055		4,604		2,344		2,328		2,328
2005		1,872		1,871		1,884		1.081		1.055		1.055		2,024		1,974		1,988		1,988
2006		692		752		801		1.134		1.081		1.062		785		813		851		851
2007		220		434		499		1.576		1.134		1.094		347		492		546		546
2008		134		320		337		3.778		1.576		1.231		506		504		415		415
2009				14		51				3.778		1.961				53		100		100
2010						7						5.029						35		26

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
Note:	The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods.
	The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit E5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1987-2005 Ultimate Losses* ($000s)

	Incurred		Indicated Ultimate Losses Based on				Selected
Accident	Losses		Paid Loss		Incurred Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1987&Prior		93,068		87,098		93,533		93,533
1988		4,507		4,557		4,530		4,530
1989		8,301		8,401		8,351		8,351
1990		17,859		18,091		17,984		17,984
1991		10,460		10,606		10,544		10,544
1992		3,570		3,624		3,602		3,613
1993		3,729		3,792		3,766		3,766
1994		3,229		3,290		3,268		3,268
1995		2,830		2,889		2,870		2,870
1996		6,455		6,603		6,558		6,558
1997		2,596		2,661		2,643		2,643
1998		7,806		7,462		7,962		7,962
1999		22,341		22,960		22,855		22,855
2000		24,562		25,397		25,225		25,225
2001		19,966		20,692		20,605		20,649
2002		2,261		2,326		2,347		2,337
2003		27,359		28,917		28,672		28,672
2004		2,207		2,221		2,328		2,328
2005		1,884		2,082		1,988		2,082
Total		264,990		263,669		269,631		269,770

* Excludes Superior National in 1999, Enron in 2001 and Consolidated Freightways in 2002.

Milliman

     WSC Assumed Business
Exhibit E6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Loss* ($000s)

	Selected
Accident	Ultimate		Paid Losses						Hindsight Outstanding Losses
Year	Losses		@36 Mos		@48 Mos		@60 Mos		@36 Mos			@48 Mos			@60 Mos
1987&Prior		93,533		38,345		60,605		62,260		55,188			32,928			31,273
1988		4,530		2,380		3,023		3,585		2,150			1,507			945
1989		8,351		3,839		4,373		6,057		4,512			3,978			2,294
1990		17,984		11,379		13,075		16,945		6,605			4,909			1,039
1991		10,544		3,385		4,473		10,029		7,159			6,071			515
1992		3,613		2,095		2,462		2,728		1,518			1,151			885
1993		3,766		2,448		3,116		3,211		1,318			650			555
1994		3,268		2,015		2,679		2,765		1,253			589			503
1995		2,870		1,778		2,010		2,232		1,092			860			638
1996		6,558		4,469		4,932		5,426		2,089			1,626			1,132
1997		2,643		1,245		1,795		1,862		1,398			848			781
1998		7,962		6,264		6,408		6,678		1,698			1,554			1,284
1999		22,855		24,710		24,965		25,251		(1,855	)		(2,110	)		(2,396	)
2000		25,225		16,806		22,501		24,430		8,419			2,724			795
2001		20,649		4,596		11,265		13,550		16,053			9,384			7,099
2002		2,337		2,400		2,399		2,404		(63	)		(62	)		(67	)
2003		28,672		23,269		25,700		26,819		5,403			2,972			1,853
2004		2,328		1,511		1,950		1,981		817			378			347
2005		2,082		1,542		1,779		1,871		540			303			211

* Excludes Superior National in 1999, Enron in 2001 and Consolidated Freightways in 2002.

Milliman

WSC Assumed Business
Exhibit E7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
	Ultimate
Accident	Reported		Closed Claims						Yet to Close
Year	Claims		@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos		@60 Mos
1987&Prior		9,355		3,617		8,078		8,432		5,738		1,277		923
1988		878		440		603		688		438		275		190
1989		1,221		679		855		965		542		366		256
1990		1,662		974		1,273		1,434		688		389		228
1991		1,406		956		1,158		1,223		450		248		183
1992		912		578		668		751		334		244		161
1993		850		406		627		701		444		223		149
1994		783		448		572		686		335		211		97
1995		562		260		373		427		302		189		135
1996		590		357		446		488		233		144		102
1997		489		285		341		365		204		148		124
1998		509		266		304		345		243		205		164
1999		445		200		232		332		245		213		113
2000		412		142		231		288		270		181		124
2001		487		179		304		324		308		183		163
2002		395		190		215		250		205		180		145
2003		291		130		166		200		161		125		91
2004		212		108		148		165		104		64		47
2005		110		59		67		82		51		43		28

Milliman

WSC Assumed Business
Exhibit E8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

							Average Hindsight Outstanding @9/30/10
							Trended using 5.0% to
Accident	Average Hindsight Outstanding @9/30/10						2008		2007		2006
Year	@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos		@60 Mos
1987&Prior		9.618		25.785		33.882		26.795		68.415		85.618
1988		4.909		5.480		4.974		13.025		13.848		11.971
1989		8.325		10.869		8.961		21.037		26.158		20.539
1990		9.600		12.620		4.557		23.104		28.925		9.947
1991		15.909		24.480		2.814		36.464		53.437		5.850
1992		4.545		4.717		5.497		9.921		9.806		10.884
1993		2.968		2.915		3.725		6.170		5.772		7.024
1994		3.740		2.791		5.186		7.405		5.263		9.313
1995		3.616		4.550		4.726		6.819		8.171		8.083
1996		8.966		11.292		11.098		16.102		19.313		18.077
1997		6.853		5.730		6.298		11.721		9.334		9.770
1998		6.988		7.580		7.829		11.383		11.759		11.567
1999		N/A		N/A		N/A		N/A		N/A		N/A
2000		31.181		15.050		6.411		46.069		21.177		8.591
2001		52.120		51.279		43.552		73.338		68.719		55.585
2002		N/A		N/A		N/A		N/A		N/A		N/A
2003		33.559		23.776		20.363		42.831		28.900		23.573
2004		7.856		5.906		7.383		9.549		6.837		8.140
2005		10.588		7.047		7.536		12.257		7.769		7.913
Selection								36.809		26.680		20.760

	Closed Claims @9/30/10				Indicated Reserve for Claims Yet to Close						Paid		Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Losses		Ultimate
Year	Claims		Claim		to Close		Claim		Loss		@9/30/10		Losses
2006		48		15.854		23		20.760		477		761		1,238
2007		39		12.641		43		26.680		1,147		493		1,640
2008		30		10.400		64		36.809		2,356		312		2,668

* Excludes Superior National in 1999, Enron in 2001 and Consolidated Freightways in 2002.

Milliman

WSC Assumed Business
Exhibit E9

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection* ($000s)

			Selected		Ultimate
	Gross		Ultimate		Loss
Accident	Earned		Losses		Ratio
Year	Premium		@9/30/10		@9/30/10
1988		31,377		4,530		14.4	%
1989		39,735		8,351		21.0	%
1990		44,623		17,984		40.3	%
1991		36,238		10,544		29.1	%
1992		29,804		3,613		12.1	%
1993		48,750		3,766		7.7	%
1994		53,388		3,268		6.1	%
1995		57,454		2,870		5.0	%
1996		49,455		6,558		13.3	%
1997		49,996		2,643		5.3	%
1998		46,420		7,962		17.2	%
1999		54,400		22,855		42.0	%
2000		60,224		25,225		41.9	%
2001		64,202		20,649		32.2	%
2002		56,069		2,337		4.2	%
2003		46,577		28,672		61.6	%
2004		38,530		2,328		6.0	%
2005		19,078		2,082		10.9	%
Total		826,320		176,237		21.3	%
M3L5		121,810		25,059		20.6	%

	Ultimate			Gross		A Priori		Estimated					Incurred		Indicated
Accident	Loss			Earned		Ultimate		Percent			Indicated		Losses		Ultimate
Year	Ratio			Premium		Losses		Unreported			IBNR		@9/30/10		Losses
2006		20.6	%		16,229		3,343		5.8	%		194		801		995
2007		20.6	%		12,705		2,617		8.6	%		225		499		724
2008		20.6	%		11,769		2,424		18.8	%		456		337		793
Total					40,703		8,384					875		1,637		2,512

* Excludes Superior National in 1999, Enron in 2001 and Consolidated Freightways in 2002.

Milliman

WSC Assumed Business
Exhibit E10

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2006-2008 Ultimate Losses ($000s)

			Indicated Ultimate Losses Based on:
							Average
	Incurred						Hindsight				Selected
Accident	Losses		Paid Loss		Incurred Loss		Outstanding		Incurred B/F		Ultimate
Year	@9/30/10		Projection		Projection		Projection		Projection		Losses
2006		801		890		851		1,238		995		1,117
2007		499		667		546		1,640		724		1,182
2008		337		533		415		2,668		793		1,731
Total		1,637		2,090		1,812		5,546		2,512		4,030

Milliman

WSC Assumed Business
Exhibit E11

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection* ($000s)

	Selected		Gross		Gross
	Ultimate		Earned		Ultimate
Accident	Losses		Premium		Loss Ratio
Year	@9/30/10		@9/30/10		@9/30/10
1988		4,530		31,377		14.4	%
1989		8,351		39,735		21.0	%
1990		17,984		44,623		40.3	%
1991		10,544		36,238		29.1	%
1992		3,613		29,804		12.1	%
1993		3,766		48,750		7.7	%
1994		3,268		53,388		6.1	%
1995		2,870		57,454		5.0	%
1996		6,558		49,455		13.3	%
1997		2,643		49,996		5.3	%
1998		7,962		46,420		17.2	%
1999		22,855		54,400		42.0	%
2000		25,225		60,224		41.9	%
2001		20,649		64,202		32.2	%
2002		2,337		56,069		4.2	%
2003		28,672		46,577		61.6	%
2004		2,328		38,530		6.0	%
2005		2,082		19,078		10.9	%
2006		1,117		16,229		6.9	%
2007		1,182		12,705		9.3	%
2008		1,731		11,769		14.7	%
Total		180,267		867,023		20.8	%
Last 7		39,449		200,957		19.6	%

	(a)		(b)			(a) x (b)
	Gross		Selected			Indicated
Accident	Earned		Ultimate			Ultimate
Year	Premium		Loss Ratio			Losses
2009		9,955		19.6	%		1,951
2010		6,857		19.6	%		1,344

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit E12

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection* ($000s)

	A Priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent			Indicated		Losses		Ultimate
Year	Losses**		Unreported			IBNR		@9/30/10		Losses***
2009		1,951		49.0	%		956		51		1,007
2010		1,792		80.1	%		1,435		7		1,082
Total		3,743					2,391		58		2,089

*	Excludes Delphi in 2009.
**	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months exposure.

Milliman

WSC Assumed Business
Exhibit E13

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection* ($000s)

	A Priori		Estimated					Paid		Indicated
Accident	Ultimate		Percent			Indicated		Losses		Ultimate
Year	Losses**		Unpaid			Unpaid		@9/30/10		Losses***
2009		1,951		69.1	%		1,348		51		1,399
2010		1,792		93.8	%		1,681		6		1,265
Total		3,743					3,029		57		2,664

*	Excludes Delphi in 2009.
**	Based on the Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months exposure.

Milliman

WSC Assumed Business
Exhibit E14

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Losses* ($000s)

	Selected						Hindsight
Accident	Ultimate		Paid Losses				Outstanding Losses
Year	Losses		@12 Mos		@24 Mos		@12 Mos		@24 Mos
1987&Prior		93,533		33,547		36,740		59,986		56,793
1988		4,530		180		685		4,350		3,845
1989		8,351		147		2,779		8,204		5,572
1990		17,984		7,010		10,105		10,974		7,879
1991		10,544		634		2,579		9,910		7,965
1992		3,613		275		1,585		3,338		2,028
1993		3,766		3,379		1,747		387		2,019
1994		3,268		287		1,051		2,981		2,217
1995		2,870		78		1,014		2,792		1,856
1996		6,558		652		3,087		5,906		3,471
1997		2,643		384		966		2,259		1,677
1998		7,962		498		5,716		7,464		2,246
1999		22,855		6,427		23,407		16,428		(552	)
2000		25,225		11,960		17,664		13,265		7,561
2001		20,649		2,410		2,152		18,239		18,497
2002		2,337		921		2,468		1,416		(131	)
2003		28,672		20,004		21,876		8,668		6,796
2004		2,328		245		1,087		2,083		1,241
2005		2,082		57		1,016		2,025		1,066
2006		1,117		108		338		1,009		779
2007		1,182		86		220		1,096		962
2008		1,731		114		299		1,617		1,432

* Excludes Superior National in 1999, Enron in 2001 and Consolidated Freightways in 2002.

Milliman

WSC Assumed Business
Exhibit E15

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
Accident	Ultimate		Closed Claims				Yet to Close
Year	Claims		@12 Mos		@24 Mos		@12 Mos		@24 Mos
1987&Prior		9,355		3,042		3,423		6,313		5,932
1988		878		12		86		866		792
1989		1,221		13		354		1,208		867
1990		1,662		100		524		1,562		1,138
1991		1,406		146		555		1,260		851
1992		912		97		366		815		546
1993		850		62		266		788		584
1994		783		95		186		688		597
1995		562		41		148		521		414
1996		590		64		195		526		395
1997		489		56		199		433		290
1998		509		48		171		461		338
1999		445		36		131		409		314
2000		412		30		89		382		323
2001		487		24		109		463		378
2002		395		44		107		351		288
2003		291		19		89		272		202
2004		212		27		73		185		139
2005		110		12		39		98		71
2006		71		9		25		62		46
2007		82		5		12		77		70
2008		94		8		23		86		71

Milliman

WSC Assumed Business
Exhibit E16

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

					Average Hindsight Outstanding @9/30/10
					Trended using 5.0% to
Accident	Average Hindsight Outstanding @9/30/10				2010		2009
Year	@12 Mos		@24 Mos		@12 Mos		@24 Mos
1987&Prior		9.502		9.574		29.186		28.006
1988		5.023		4.855		14.694		13.526
1989		6.791		6.427		18.919		17.053
1990		7.026		6.924		18.642		17.497
1991		7.865		9.360		19.874		22.526
1992		4.096		3.714		9.858		8.513
1993		0.491		3.457		1.125		7.546
1994		4.333		3.714		9.458		7.721
1995		5.359		4.483		11.141		8.876
1996		11.228		8.787		22.231		16.569
1997		5.217		5.783		9.837		10.385
1998		16.191		6.645		29.077		11.365
1999		40.166		N/A		68.697		N/A
2000		34.725		23.409		56.563		36.315
2001		39.393		48.934		61.111		72.298
2002		4.034		N/A		5.960		N/A
2003		31.868		33.644		44.841		45.086
2004		11.259		8.928		15.088		11.395
2005		20.663		15.014		26.372		18.250
2006		16.274		16.935		19.781		19.604
2007		14.234		13.743		16.478		15.152
2008		18.802		20.169		20.729		21.177
Selection						20.840		18.546

	Closed Claims @9/30/10				Indicated Reserve for Claims Yet to Close								Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Paid Losses		Ultimate
Year	Claims		Claim		to Close		Claim		Loss		@9/30/10		Losses
2009		19		2.684		60		18.546		1,113		51		1,164
2010		0		0.000		43		20.840		896		6		902

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit E17

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 2009-2010 Ultimate Losses* ($000s)

					Indicated Ultimate Losses**												Selected		Ultimate
	Incurred		Gross		Paid		Incurred		Average		Incurred		Paid		Loss		Ultimate		Loss
Accident	Losses		Earned		Loss		Loss		Hindsight		B/F		B/F		Ratio		Losses		Ratio
Year	@9/30/10		Premium		Projection		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
2009		51		9,955		165		100		1,164		1,007		1,399		1,951		1,558		15.7	%
2010		7		6,857		72		26		902		1,082		1,265		1,344		1,344		19.6	%
Total		58		16,812		237		126		2,066		2,089		2,664		3,295		2,902		17.3	%

*	Excludes Delphi in 2009.
**	Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Assumed Business
Exhibit E18

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses* ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Losses
Year	Losses		Losses		Losses		Outstanding		@9/30/10		@9/30/10
1987&Prior		93,533		86,236		93,068		6,832		465		7,297
1988		4,530		4,507		4,507		0		23		23
1989		8,351		8,301		8,301		0		50		50
1990		17,984		17,859		17,859		0		125		125
1991		10,544		10,460		10,460		0		84		84
1992		3,613		3,570		3,570		0		43		43
1993		3,766		3,729		3,729		0		37		37
1994		3,268		3,229		3,229		0		39		39
1995		2,870		2,830		2,830		0		40		40
1996		6,558		6,455		6,455		0		103		103
1997		2,643		2,596		2,596		0		47		47
1998		7,962		7,266		7,806		540		156		696
1999		22,855		22,291		22,341		50		514		564
2000		25,225		24,562		24,562		0		663		663
2001		20,649		19,896		19,966		70		683		753
2002		2,337		2,222		2,261		39		76		115
2003		28,672		27,358		27,359		1		1,313		1,314
2004		2,328		2,066		2,207		141		121		262
2005		2,082		1,876		1,884		8		198		206
2006		1,117		761		801		40		316		356
2007		1,182		493		499		6		683		689
2008		1,731		312		337		25		1,394		1,419
2009		1,558		51		51		0		1,507		1,507
2010		1,344		6		7		1		1,337		1,338
Total		276,702		258,932		266,685		7,753		10,017		17,770

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit E19

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		3,473		3,877		4,132		7,611		7,890		8,078		8,203		8,280		8,755		8,936		9,023		9,067		9,091		9,124		9,142		9,157		9,205		9,251		9,276		9,301		9,322		9,355		9,348		9,369
1988		6		141		627		820		908		972		978		998		1,053		1,058		1,096		1,103		1,103		1,103		1,103		1,103		1,103		1,103		1,103		1,105		1,105		1,105		1,105
1989		41		419		698		915		1,092		1,197		1,231		1,275		1,301		1,312		1,328		1,341		1,341		1,344		1,345		1,362		1,364		1,365		1,365		1,365		1,365		1,365
1990		87		681		1,254		1,603		1,728		1,839		1,882		1,904		1,910		1,918		1,925		1,926		1,926		1,926		1,940		1,946		1,946		1,946		1,946		1,946		1,946
1991		60		360		556		651		732		835		870		893		925		943		970		980		989		992		994		994		997		1,001		1,001		1,001
1992		97		194		267		314		387		430		451		460		512		516		518		537		541		541		542		549		556		557		557
1993		220		317		403		463		496		507		526		548		562		582		595		605		611		614		617		618		618		618
1994		87		180		315		347		366		426		441		441		441		441		447		452		457		465		476		491		496
1995		0		28		72		132		170		196		238		256		263		266		276		287		288		294		295		300
1996		12		99		177		215		258		285		316		353		417		426		430		461		469		480		480
1997		14		88		203		293		307		340		449		368		369		371		371		373		373		373
1998		168		460		510		582		666		779		801		860		903		922		928		929		945
1999		43		252		519		656		714		953		1,227		1,571		1,837		3,095		3,099		3,099
2000		27		136		259		356		414		439		535		704		709		713		713
2001		42		2,845		4,341		4,815		5,088		5,156		5,187		5,198		5,208		5,216
2002		69		358		612		803		919		1,087		1,247		1,333		1,344
2003		51		108		186		571		708		1,018		1,284		1,286
2004		15		66		132		171		193		246		262
2005		14		68		108		138		152		162
2006		16		41		54		61		74
2007		0		3		36		45
2008		9		15		34
2009		11		18
2010		1

* Last Diagonal is as of 9/30/10.

Accident	Paid ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.116		1.066		1.842		1.037		1.024		1.015		1.009		1.057		1.021		1.010		1.005		1.003		1.004		1.002		1.002		1.005		1.005		1.003		1.003		1.002		1.004		0.999		1.003
1988		23.500		4.447		1.308		1.107		1.070		1.006		1.020		1.055		1.005		1.036		1.006		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.002		1.000		1.000		1.000
1989		10.220		1.666		1.311		1.193		1.096		1.028		1.036		1.020		1.008		1.012		1.010		1.000		1.002		1.001		1.013		1.001		1.001		1.000		1.000		1.000		1.000
1990		7.828		1.841		1.278		1.078		1.064		1.023		1.012		1.003		1.004		1.004		1.001		1.000		1.000		1.007		1.003		1.000		1.000		1.000		1.000		1.000
1991		6.000		1.544		1.171		1.124		1.141		1.042		1.026		1.036		1.019		1.029		1.010		1.009		1.003		1.002		1.000		1.003		1.004		1.000		1.000
1992		2.000		1.376		1.176		1.232		1.111		1.049		1.020		1.113		1.008		1.004		1.037		1.007		1.000		1.002		1.013		1.013		1.002		1.000
1993		1.441		1.271		1.149		1.071		1.022		1.037		1.042		1.026		1.036		1.022		1.017		1.010		1.005		1.005		1.002		1.000		1.000
1994		2.069		1.750		1.102		1.055		1.164		1.035		1.000		1.000		1.000		1.014		1.011		1.011		1.018		1.024		1.032		1.014
1995		N/A		2.571		1.833		1.288		1.153		1.214		1.076		1.027		1.011		1.038		1.040		1.003		1.021		1.003		1.023
1996		8.250		1.788		1.215		1.200		1.105		1.109		1.117		1.181		1.022		1.009		1.072		1.017		1.023		1.000
1997		6.286		2.307		1.443		1.048		1.107		1.321		0.820		1.003		1.005		1.000		1.005		1.000		1.000
1998		2.738		1.109		1.141		1.144		1.170		1.028		1.074		1.050		1.021		1.007		1.001		1.023
1999		5.860		2.060		1.264		1.088		1.335		1.288		1.280		1.169		1.685		1.001		1.000
2000		5.037		1.904		1.375		1.163		1.060		1.219		1.316		1.007		1.006		1.000
2001		67.738		1.526		1.109		1.057		1.013		1.006		1.002		1.002		1.002
2002		5.188		1.709		1.312		1.144		1.183		1.147		1.069		1.011
2003		2.118		1.722		3.070		1.240		1.438		1.261		1.002
2004		4.400		2.000		1.295		1.129		1.275		1.088
2005		4.857		1.588		1.278		1.101		1.089
2006		2.563		1.317		1.130		1.294
2007		N/A		12.000		1.347
2008		1.667		2.977
2009		1.928
**    Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		8.229		2.343		1.388		1.140		1.138		1.107		1.054		1.048		1.057		1.013		1.017		1.007		1.007		1.005		1.010		1.005		1.002		1.000		1.001		1.001		1.001		1.000		1.003
Average x 87		8.584		2.404		1.365		1.145		1.144		1.112		1.057		1.047		1.059		1.013		1.018		1.007		1.007		1.005		1.011		1.004		1.001		1.000		1.000		1.000		1.000		1.000
Average x H/L		5.471		1.924		1.315		1.137		1.128		1.099		1.052		1.041		1.013		1.012		1.013		1.006		1.006		1.003		1.008		1.004		1.001		1.000		1.001		1.000		1.000
Avg L5 x H/L		2.245		2.189		1.307		1.171		1.182		1.151		1.117		1.023		1.011		1.003		1.015		1.011		1.014		1.003		1.012		1.005		1.001		1.000		1.001
Wtd Average		2.358		1.444		1.395		1.081		1.076		1.054		1.033		1.042		1.062		1.010		1.007		1.004		1.004		1.003		1.004		1.004		1.003		1.002		1.002		1.002		1.003		0.999		1.003
WA x 1987		6.318		1.658		1.232		1.106		1.103		1.073		1.044		1.035		1.084		1.011		1.009		1.006		1.004		1.004		1.007		1.003		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		2.964		1.941		1.918		1.176		1.087		1.072		1.065		1.035		1.143		1.003		1.009		1.014		1.013		1.007		1.010		1.004		1.001		1.000		1.002
Selected		6.318		2.189		1.599		1.137		1.182		1.108		1.065		1.035		1.019		1.003		1.009		1.011		1.013		1.007		1.010		1.006		1.002		1.002		1.001		1.001		1.001		1.001		1.001

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		39.721		6.287		2.872		1.796		1.580		1.337		1.207		1.133		1.095		1.075		1.072		1.062		1.050		1.037		1.030		1.020		1.014		1.012		1.010		1.009		1.008		1.007		1.006		1.005

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		73.198		9.968		3.493		2.020		1.632		1.394		1.238		1.151		1.104		1.080		1.073		1.064		1.053		1.040		1.032		1.023		1.016		1.013		1.011		1.009		1.008		1.007		1.006		1.005

Milliman

WSC Assumed Business
Exhibit E20

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Paid ALAE Projection

																			Indicated
							Cumulative												Ultimate
Accident	Paid ALAE* ($000s)						Development Factors						Indicated Ultimate ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		9,355		9,348		9,369		1.007		1.006		1.005		9,420		9,404		9,416		9,416
1988		1,105		1,105		1,105		1.008		1.007		1.006		1,114		1,113		1,112		1,112
1989		1,365		1,365		1,365		1.009		1.008		1.007		1,377		1,376		1,375		1,375
1990		1,946		1,946		1,946		1.010		1.009		1.008		1,965		1,964		1,962		1,962
1991		1,001		1,001		1,001		1.012		1.010		1.009		1,013		1,011		1,010		1,010
1992		556		557		557		1.014		1.012		1.011		564		564		563		563
1993		618		618		618		1.020		1.014		1.013		630		627		626		626
1994		476		491		496		1.030		1.020		1.016		490		501		504		504
1995		294		295		300		1.037		1.030		1.023		305		304		307		307
1996		469		480		480		1.050		1.037		1.032		492		498		495		495
1997		373		373		373		1.062		1.050		1.040		396		392		388		388
1998		928		929		945		1.072		1.062		1.053		995		987		995		995
1999		3,095		3,099		3,099		1.075		1.072		1.064		3,327		3,322		3,297		3,297
2000		709		713		713		1.095		1.075		1.073		776		766		765		765
2001		5,198		5,208		5,216		1.133		1.095		1.080		5,889		5,703		5,633		5,633
2002		1,247		1,333		1,344		1.207		1.133		1.104		1,505		1,510		1,484		1,484
2003		1,018		1,284		1,286		1.337		1.207		1.151		1,361		1,550		1,480		1,480
2004		193		246		262		1.580		1.337		1.238		305		329		324		324
2005		138		152		162		1.796		1.580		1.394		248		240		226		226
2006		54		61		74		2.872		1.796		1.632		155		110		121		121
2007		3		36		45		6.287		2.872		2.020		19		103		91		91
2008		9		15		34		39.721		6.287		3.493		357		94		119		119
2009				11		18				39.721		9.968				437		179		179
2010						1						73.198						73		55

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit E21

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE/Paid Loss* + 1
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		1.104		1.106		1.108		1.126		1.127		1.128		1.120		1.119		1.125		1.127		1.126		1.126		1.124		1.124		1.123		1.122		1.120		1.118		1.116		1.114		1.113		1.111		1.109		1.109
1988		1.033		1.206		1.263		1.271		1.253		1.257		1.246		1.250		1.238		1.237		1.245		1.245		1.245		1.245		1.245		1.245		1.245		1.245		1.245		1.245		1.245		1.245		1.245
1989		1.279		1.151		1.182		1.209		1.180		1.155		1.156		1.158		1.159		1.159		1.161		1.162		1.162		1.162		1.162		1.164		1.164		1.164		1.164		1.164		1.164		1.164
1990		1.012		1.067		1.110		1.123		1.102		1.106		1.107		1.108		1.108		1.108		1.109		1.108		1.108		1.108		1.109		1.109		1.109		1.109		1.109		1.109		1.109
1991		1.095		1.140		1.164		1.146		1.073		1.082		1.085		1.087		1.089		1.091		1.093		1.094		1.095		1.095		1.095		1.095		1.095		1.096		1.096		1.096
1992		1.353		1.122		1.127		1.128		1.142		1.147		1.148		1.149		1.148		1.149		1.149		1.155		1.155		1.155		1.156		1.154		1.156		1.156		1.156
1993		1.065		1.181		1.165		1.149		1.154		1.155		1.160		1.167		1.164		1.165		1.168		1.169		1.168		1.166		1.165		1.166		1.166		1.166
1994		1.303		1.171		1.156		1.130		1.132		1.141		1.139		1.138		1.138		1.137		1.138		1.140		1.142		1.144		1.147		1.152		1.154
1995		1.000		1.028		1.040		1.066		1.076		1.078		1.088		1.092		1.094		1.095		1.098		1.101		1.102		1.104		1.104		1.106
1996		1.018		1.032		1.040		1.044		1.048		1.052		1.055		1.055		1.065		1.066		1.067		1.072		1.073		1.075		1.074
1997		1.036		1.091		1.163		1.163		1.165		1.154		1.176		1.142		1.143		1.143		1.143		1.144		1.144		1.144
1998		1.337		1.080		1.081		1.091		1.100		1.110		1.113		1.120		1.124		1.127		1.128		1.128		1.130
1999		1.007		1.011		1.021		1.026		1.028		1.038		1.049		1.062		1.073		1.132		1.139		1.139
2000		1.002		1.008		1.015		1.016		1.017		1.018		1.022		1.029		1.029		1.029		1.029
2001		1.017		2.322		1.945		1.427		1.375		1.380		1.261		1.261		1.262		1.262
2002		1.075		1.145		1.255		1.335		1.382		1.468		1.554		1.609		1.605
2003		1.003		1.005		1.008		1.022		1.026		1.037		1.047		1.047
2004		1.061		1.061		1.087		1.088		1.097		1.119		1.127
2005		1.246		1.067		1.070		1.078		1.081		1.086
2006		1.148		1.121		1.082		1.090		1.097
2007		1.000		1.014		1.090		1.091
2008		1.079		1.050		1.109
2009		1.786		1.353
2010		1.167

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009. Last Diagonal is as of 9/30/10.

Accident	Paid ALAE/Paid Loss + 1 Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108-120		120-132		132-144		144-156		156-168		168-180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.002		1.002		1.016		1.001		1.001		0.993		1.000		1.005		1.002		0.999		1.000		0.998		1.000		0.999		0.999		0.998		0.998		0.998		0.998		0.998		0.999		0.998		0.999
1988		1.167		1.048		1.006		0.986		1.003		0.991		1.003		0.990		0.999		1.006		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		0.900		1.027		1.023		0.976		0.978		1.001		1.002		1.001		1.000		1.002		1.001		1.000		1.000		1.000		1.002		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.054		1.040		1.011		0.982		1.004		1.001		1.001		1.000		1.000		1.000		0.999		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.041		1.022		0.984		0.937		1.009		1.003		1.001		1.002		1.002		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		0.830		1.004		1.000		1.013		1.005		1.001		1.001		0.998		1.001		1.001		1.005		1.001		1.000		1.000		0.998		1.002		1.000		1.000
1993		1.109		0.986		0.986		1.005		1.000		1.005		1.005		0.998		1.001		1.003		1.001		0.999		0.998		1.000		1.000		1.000		1.000
1994		0.899		0.987		0.977		1.003		1.008		0.998		0.999		1.000		0.999		1.001		1.001		1.001		1.002		1.003		1.004		1.002
1995		1.028		1.013		1.024		1.010		1.002		1.010		1.003		1.002		1.001		1.003		1.003		1.000		1.002		1.000		1.002
1996		1.013		1.007		1.004		1.004		1.004		1.003		1.000		1.009		1.001		1.001		1.005		1.001		1.002		1.000
1997		1.053		1.066		1.000		1.001		0.991		1.019		0.972		1.000		1.001		1.000		1.001		1.000		1.000
1998		0.808		1.001		1.009		1.008		1.010		1.002		1.007		1.004		1.002		1.001		1.000		1.003
1999		1.004		1.010		1.005		1.002		1.009		1.011		1.012		1.011		1.055		1.007		1.000
2000		1.005		1.008		1.000		1.001		1.001		1.004		1.007		1.000		1.000		1.000
2001		2.282		0.837		0.734		0.964		1.003		0.914		1.000		1.000		1.000
2002		1.065		1.096		1.064		1.036		1.062		1.059		1.035		0.997
2003		1.002		1.003		1.014		1.004		1.011		1.009		1.000
2004		1.000		1.025		1.000		1.009		1.020		1.009
2005		0.857		1.003		1.007		1.003		1.006
2006		0.977		0.965		1.007		1.009
2007		1.014		1.075		1.002
2008		0.973		1.087
2009		0.711
**    Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		1.035		1.014		0.994		0.998		1.007		1.002		1.003		1.001		1.004		1.002		1.001		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		0.999		0.999
Average x 87		1.036		1.015		0.993		0.997		1.007		1.002		1.003		1.001		1.004		1.002		1.001		1.000		1.000		1.000		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		0.990		1.019		1.004		0.999		1.005		1.004		1.003		1.001		1.001		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		0.983		1.010		1.009		1.005		1.011		1.008		1.008		1.002		1.001		1.001		1.002		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
Selected		1.036		1.019		1.009		1.005		1.005		1.004		1.003		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		1.090		1.052		1.032		1.023		1.018		1.013		1.009		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		1.115		1.061		1.037		1.025		1.019		1.014		1.010		1.007		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit E22

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	(1)		(2)		(3)
					[(1)x(2)]
	Paid ALAE/		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
Accident	Ratio		Factors for		Ratio
Year	@9/30/10		9/10-Ult		@9/30/10
1987&Prior		1.109		1.000		1.109
1988		1.245		1.000		1.245
1989		1.164		1.000		1.164
1990		1.109		1.000		1.109
1991		1.096		1.000		1.096
1992		1.156		1.000		1.156
1993		1.166		1.000		1.166
1994		1.154		1.000		1.154
1995		1.106		1.000		1.106
1996		1.074		1.000		1.074
1997		1.144		1.000		1.144
1998		1.130		1.000		1.130
1999		1.139		1.001		1.140
2000		1.029		1.002		1.031
2001		1.262		1.003		1.266
2002		1.605		1.005		1.613
2003		1.047		1.007		1.054
2004		1.127		1.010		1.138
2005		1.086		1.014		1.102
2006		1.097		1.019		1.118
2007		1.091		1.025		1.119
2008		1.109		1.037		1.150
2009		1.353		1.061		1.435
2010		1.167		1.115		1.301

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

WSC Assumed Business
Exhibit E23

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

					Selected						Selected		Ultimate
			Paid ALAE		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident	Paid		To Paid		Losses		Projection		Projection		ALAE*		Ultimate
Year	ALAE		Loss Ratio		($000s)		($000s)		($000s)		($000s)		Loss Ratio
1987&Prior		9,369		0.109		93,533		10,195		9,416		9,416		0.1007
1988		1,105		0.245		4,530		1,110		1,112		1,112		0.2455
1989		1,365		0.164		8,351		1,370		1,375		1,375		0.1647
1990		1,946		0.109		17,984		1,960		1,962		1,962		0.1091
1991		1,001		0.096		10,544		1,012		1,010		1,012		0.0960
1992		557		0.156		3,613		564		563		563		0.1558
1993		618		0.166		3,766		625		626		626		0.1662
1994		496		0.154		3,268		503		504		504		0.1542
1995		300		0.106		2,870		304		307		307		0.1070
1996		480		0.074		6,558		485		495		490		0.0747
1997		373		0.144		2,643		381		388		385		0.1457
1998		945		0.130		7,962		1,035		995		1,015		0.1275
1999		3,099		0.140		22,855		3,200		3,297		3,249		0.1422
2000		713		0.031		25,225		782		765		774		0.0307
2001		5,216		0.266		20,649		5,493		5,633		5,563		0.2694
2002		1,344		0.613		2,337		1,433		1,484		1,459		0.6243
2003		1,286		0.054		28,672		1,548		1,480		1,514		0.0528
2004		262		0.138		2,328		321		324		323		0.1387
2005		162		0.102		2,082		212		226		226		0.1085
2006		74		0.118		1,117		132		121		127		0.1137
2007		45		0.119		1,182		141		91		116		0.0981
2008		34		0.150		1,731		260		119		260		0.1502
2009		18		0.435		1,558		678		179		429		0.2754
2010		1		0.301		1,344		405		55		286		0.2128
Total		30,809				276,702		34,149		32,527		33,093		0.1196

* Selected Ultimate ALAE for the 2010 year reflects exposure as of September 30, 2010 and is based on an ALAE to Loss Ratio of 21.3%, which is the weighted average ratio of 2008-2009.

Milliman

WSC Assumed Business
Exhibit E24

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Paid		Ultimate		Unpaid
Accident	ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1987&Prior		9,369		9,416		47
1988		1,105		1,112		7
1989		1,365		1,375		10
1990		1,946		1,962		16
1991		1,001		1,012		11
1992		557		563		6
1993		618		626		8
1994		496		504		8
1995		300		307		7
1996		480		490		10
1997		373		385		12
1998		945		1,015		70
1999		3,099		3,249		150
2000		713		774		61
2001		5,216		5,563		347
2002		1,344		1,459		115
2003		1,286		1,514		228
2004		262		323		61
2005		162		226		64
2006		74		127		53
2007		45		116		71
2008		34		260		226
2009		18		429		411
2010		1		286		285
Total		30,809		33,093		2,284

Milliman

WSC Assumed Business
Exhibit E25

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE* ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1987&Prior		102,949		95,605		102,437		6,832		512		7,344
1988		5,642		5,612		5,612		0		30		30
1989		9,726		9,666		9,666		0		60		60
1990		19,946		19,805		19,805		0		141		141
1991		11,556		11,461		11,461		0		95		95
1992		4,176		4,127		4,127		0		49		49
1993		4,392		4,347		4,347		0		45		45
1994		3,772		3,725		3,725		0		47		47
1995		3,177		3,130		3,130		0		47		47
1996		7,048		6,935		6,935		0		113		113
1997		3,028		2,969		2,969		0		59		59
1998		8,977		8,211		8,751		540		226		766
1999		26,104		25,390		25,440		50		664		714
2000		25,999		25,275		25,275		0		724		724
2001		26,212		25,112		25,182		70		1,030		1,100
2002		3,796		3,566		3,605		39		191		230
2003		30,186		28,644		28,645		1		1,541		1,542
2004		2,651		2,328		2,469		141		182		323
2005		2,308		2,038		2,046		8		262		270
2006		1,244		835		875		40		369		409
2007		1,298		538		544		6		754		760
2008		1,991		346		371		25		1,620		1,645
2009		1,987		69		69		0		1,918		1,918
2010		1,630		7		8		1		1,622		1,623
Total		309,795		289,741		297,494		7,753		12,301		20,054

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit F1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Accident	Loss Salvage & Subrogation Recovered* ($000s)
Year	12			24			36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		6,764			7,033			7,335		12,118		12,827		12,925		13,374		13,614		14,135		14,182		14,221		14,560		14,621		14,984		14,974		14,986		15,261		15,416		15,623		15,680		15,732		15,763		15,740		16,769
1988		147			182			410		512		582		629		674		724		767		768		804		805		806		808		809		809		809		810		827		827		827		827		827
1989		20			154			285		530		707		701		814		2,251		2,284		2,298		2,310		2,325		2,331		2,334		2,336		2,334		2,343		2,343		2,345		2,345		2,345		2,345
1990		101			52			104		899		1,050		1,146		1,455		1,804		2,047		2,080		2,101		2,104		2,104		2,103		2,112		2,112		2,112		2,112		2,112		2,112		2,127
1991		49			264			296		360		630		768		863		967		989		1,090		1,100		1,103		1,104		1,114		1,114		1,116		1,116		1,116		1,116		1,116
1992		97			391			469		527		573		623		657		664		670		647		647		642		642		642		642		642		642		647		652
1993		3,067			489			657		935		967		1,029		1,117		1,118		1,116		1,117		1,117		1,117		1,117		1,150		1,150		1,150		1,150		1,150
1994		2			214			341		506		523		540		476		485		651		653		653		654		656		657		657		658		658
1995		2			166			200		255		283		370		476		502		514		549		550		550		550		550		551		551
1996		56			1,985			2,060		2,097		2,359		2,426		2,492		2,517		2,523		2,593		2,603		2,612		2,622		2,810		2,818
1997		43			68			104		162		178		224		219		283		285		321		355		356		356		358
1998		158			217			409		487		647		1,008		1,037		1,140		1,148		1,157		1,263		1,267		1,276
1999		578			952			904		830		858		936		964		992		8,700		8,687		7,435		7,433
2000		(21	)		(39	)		111		147		1,213		1,277		1,366		1,447		1,676		1,676		1,816
2001		0			171			183		430		715		742		6,249		6,253		6,254		6,256
2002		0			18			62		66		70		111		111		95		99
2003		70			69			94		2,074		2,056		2,035		2,053		2,703
2004		0			12			23		27		104		379		379
2005		0			0			26		45		44		1,270
2006		0			1			4		10		516
2007		0			9			14		35
2008		0			3			15
2009		0			6
2010		0
*  Last Diagonal is as of 9/30/10. Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 & Delphi in 2009.
Accident	Salvage & Subrogation Recovered Development Factors**
Year	12 - 24			24 - 36			36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		1.040			1.043			1.652		1.059		1.008		1.035		1.018		1.038		1.003		1.003		1.024		1.004		1.025		0.999		1.001		1.018		1.010		1.013		1.004		1.003		1.002		0.999		1.088
1988		1.238			2.253			1.249		1.137		1.081		1.072		1.074		1.059		1.001		1.047		1.001		1.001		1.002		1.001		1.000		1.000		1.001		1.021		1.000		1.000		1.000		1.000
1989		7.700			1.851			1.860		1.334		0.992		1.161		2.765		1.015		1.006		1.005		1.006		1.003		1.001		1.001		0.999		1.004		1.000		1.001		1.000		1.000		1.000
1990		0.515			2.000			8.644		1.168		1.091		1.270		1.240		1.135		1.016		1.010		1.001		1.000		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.009
1991		5.388			1.121			1.216		1.750		1.219		1.124		1.121		1.023		1.102		1.009		1.003		1.001		1.009		1.000		1.002		1.000		1.000		1.000		1.000
1992		4.031			1.199			1.124		1.087		1.087		1.055		1.011		1.009		0.966		1.000		0.992		1.000		1.000		1.000		1.000		1.000		1.008		1.010
1993		0.159			1.344			1.423		1.034		1.064		1.086		1.001		0.998		1.001		1.000		1.000		1.000		1.030		1.000		1.000		1.000		1.000
1994		107.000			1.593			1.484		1.034		1.033		0.881		1.019		1.342		1.003		1.000		1.002		1.003		1.002		1.000		1.002		1.000
1995		83.000			1.205			1.275		1.110		1.307		1.286		1.055		1.024		1.068		1.002		1.000		1.000		1.000		1.002		1.000
1996		35.446			1.038			1.018		1.125		1.028		1.027		1.010		1.002		1.028		1.004		1.003		1.004		1.072		1.004
1997		1.581			1.529			1.558		1.099		1.258		0.978		1.292		1.007		1.126		1.106		1.003		1.000		1.007
1998		1.373			1.885			1.191		1.329		1.558		1.029		1.099		1.007		1.008		1.092		1.003		1.009
1999		1.647			0.950			0.918		1.034		1.091		1.030		1.029		8.770		0.999		0.856		1.000
2000		1.857			(2.846	)		1.324		8.252		1.053		1.070		1.059		1.158		1.000		1.113
2001					1.070			2.350		1.663		1.038		8.422		1.001		1.000		1.000
2002					3.444			1.065		1.061		1.586		1.000		0.856		1.057
2003		0.986			1.362			22.064		0.991		0.990		1.009		1.443
2004					1.917			1.174		3.852		3.644		1.000
2005								1.731		0.978		88.539
2006					4.000			2.500		192.102
2007					1.556			3.393
2008					8.550
2009
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		16.864			1.813			2.867		11.210		5.877		1.474		1.182		1.540		1.022		1.018		1.003		1.002		1.013		1.001		1.000		1.003		1.003		1.008		1.001		1.003		1.001		0.999		1.088
Average x 87		17.994			1.851			2.928		11.744		6.148		1.500		1.192		1.574		1.023		1.019		1.001		1.002		1.012		1.001		1.000		1.001		1.002		1.006		1.000		1.003		1.000		1.000
Average x H/L		11.216			1.703			1.959		1.729		1.302		1.077		1.098		1.063		1.018		1.023		1.002		1.002		1.008		1.001		1.000		1.001		1.002		1.006		1.000		1.002		1.000
Average L5		N/A			3.477			6.172		39.797		19.159		2.500		1.078		2.598		1.027		1.034		1.002		1.003		1.022		1.001		1.001		1.000		1.002		1.006		1.001
Wtd Average		1.115			1.137			1.637		1.230		1.204		1.248		1.099		1.258		1.007		0.979		1.010		1.003		1.022		1.001		1.001		1.012		1.007		1.010		1.003		1.003		1.002		0.999		1.088
Wtd Average x 87		1.231			1.261			1.620		1.420		1.389		1.432		1.151		1.399		1.009		0.965		1.001		1.002		1.019		1.002		1.000		1.001		1.001		1.004		1.000		1.004		1.000		1.000
Selected		3.103			1.703			1.620		1.420		1.302		1.077		1.078		1.058		1.022		1.018		1.002		1.002		1.010		1.002		1.001		1.001		1.002		1.002		1.001		1.001		1.001		1.001		1.001
	12-Ult			24-Ult			36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		20.806			6.705			3.937		2.430		1.711		1.314		1.220		1.132		1.070		1.047		1.028		1.026		1.024		1.014		1.012		1.011		1.010		1.008		1.006		1.005		1.004		1.003		1.002		1.001
	9-Ult			21-Ult			33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		33.781			8.899			4.497		2.741		1.868		1.404		1.243		1.153		1.085		1.053		1.033		1.027		1.025		1.017		1.013		1.011		1.010		1.009		1.007		1.005		1.004		1.003		1.002		1.001

Milliman

WSC Assumed Business
Exhibit F2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Loss Salvage & Subrogation Recovered Development Projection Method* ($000s)

	(1)		(2)		(3)
					[(1)*(2)]
					Projected
					Ultimate
			Cumulative		Loss
	Salvage		Development		Salvage
Accident	Recovered		Factors		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10
1987 & Prior		16,769		1.001		16,786
1988		827		1.002		829
1989		2,345		1.003		2,352
1990		2,127		1.004		2,136
1991		1,116		1.005		1,122
1992		652		1.007		657
1993		1,150		1.009		1,160
1994		658		1.010		665
1995		551		1.011		557
1996		2,818		1.013		2,855
1997		358		1.017		364
1998		1,276		1.025		1,308
1999		7,433		1.027		7,634
2000		1,816		1.033		1,876
2001		6,256		1.053		6,588
2002		99		1.085		107
2003		2,703		1.153		3,117
2004		379		1.243		471
2005		1,270		1.404		1,783
2006		516		1.868		964
2007		35		2.741		96
2008		15		4.497		67
2009		6		8.899		53
2010		0		33.781		N/A
Total		51,175				53,547

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 & Delphi in 2009.
Note: The 9-Ult Cumulative Development Factor was interpolated using curve fitting methods.
The Projected Ultimate Salvage for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit F3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Bornhuetter — Ferguson Projection ($000s)

	2005		2006		2007		2008		2009
1) A Priori Salvage & Subrogation Ratio at 9/30/10*		0.200		0.200		0.200		0.200		0.200
2) Selected Ultimate Losses at 9/30/10		2,082		1,117		1,182		1,731		1,558
3) A Priori Ultimate Salvage & Subrogation at 9/30/10 (1) x (2)		416		223		236		346		312
4) Estimated % Unrecovered [1-1/CDF]		0.288		0.465		0.635		0.778		0.888
5) Estimated Future Salvage & Subrogation Recoverable at 9/30/10 (3) x (4)		120		104		150		269		277
6) Salvage & Subrogation Recovered to Date		1,270		516		35		15		6
7) Indicated Ultimate Salvage & Subrogation (5) + (6)		1,390		620		185		284		283

* Based on the average Salvage & Subrogation Ratios for all years 2004 and prior.

Milliman

WSC Assumed Business
Exhibit F4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		33,547		36,740		38,345		60,605		62,260		63,330		68,566		69,295		70,073		70,375		71,414		71,946		73,367		73,721		74,242		75,139		76,640		78,264		79,942		81,399		82,860		83,917		85,459		86,236
1988		180		685		2,380		3,023		3,585		3,775		3,972		3,985		4,417		4,460		4,471		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,506		4,507		4,507		4,507
1989		147		2,779		3,839		4,373		6,057		7,730		7,913		8,055		8,174		8,247		8,250		8,274		8,301		8,301		8,301		8,301		8,301		8,301		8,301		8,301		8,301		8,301
1990		7,010		10,105		11,379		13,075		16,945		17,351		17,638		17,668		17,724		17,724		17,728		17,847		17,858		17,858		17,858		17,858		17,859		17,859		17,859		17,859		17,859
1991		634		2,579		3,385		4,473		10,029		10,148		10,210		10,294		10,417		10,417		10,423		10,459		10,459		10,459		10,459		10,460		10,460		10,460		10,460		10,460
1992		275		1,585		2,095		2,462		2,728		2,922		3,051		3,080		3,471		3,471		3,471		3,472		3,482		3,482		3,483		3,570		3,570		3,570		3,570
1993		3,379		1,747		2,448		3,116		3,211		3,274		3,280		3,287		3,424		3,521		3,536		3,575		3,640		3,704		3,729		3,729		3,729		3,729
1994		287		1,051		2,015		2,679		2,765		3,015		3,175		3,198		3,205		3,219		3,228		3,228		3,229		3,229		3,229		3,229		3,229
1995		78		1,014		1,778		2,010		2,232		2,518		2,697		2,793		2,810		2,814		2,816		2,830		2,830		2,830		2,830		2,830
1996		652		3,087		4,469		4,932		5,426		5,515		5,754		6,379		6,436		6,439		6,439		6,439		6,439		6,439		6,455
1997		384		966		1,245		1,795		1,862		2,209		2,554		2,586		2,586		2,589		2,596		2,596		2,596		2,596
1998		498		5,716		6,264		6,408		6,678		7,062		7,110		7,154		7,254		7,256		7,259		7,266		7,266
1999		6,427		23,407		24,710		24,965		25,251		25,074		24,855		25,483		25,222		23,526		22,293		22,291
2000		11,960		17,664		16,806		22,501		24,430		24,520		24,474		24,554		24,554		24,554		24,562
2001		2,410		2,152		4,596		11,265		13,550		13,577		19,854		19,878		19,882		19,896
2002		921		2,468		2,400		2,399		2,404		2,325		2,249		2,189		2,222
2003		20,004		21,876		23,269		25,700		26,819		27,319		27,320		27,358
2004		245		1,087		1,511		1,950		1,981		2,062		2,066
2005		57		1,016		1,542		1,779		1,871		1,876
2006		108		338		658		678		761
2007		86		220		402		493
2008		114		299		312
2009		14		51
2010		6

* Last Diagonal is as of 9/30/10. Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 & Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit F5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Losses*
Year	12			24			36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		0.202			0.191			0.191		0.200		0.206		0.204		0.195		0.196		0.202		0.202		0.199		0.202		0.199		0.203		0.202		0.199		0.199		0.197		0.195		0.193		0.190		0.188		0.184		0.194
1988		0.817			0.266			0.172		0.169		0.162		0.167		0.170		0.182		0.174		0.172		0.180		0.179		0.179		0.179		0.180		0.180		0.180		0.180		0.184		0.184		0.183		0.183		0.183
1989		0.136			0.055			0.074		0.121		0.117		0.091		0.103		0.279		0.279		0.279		0.280		0.281		0.281		0.281		0.281		0.281		0.282		0.282		0.282		0.282		0.282		0.282
1990		0.014			0.005			0.009		0.069		0.062		0.066		0.082		0.102		0.115		0.117		0.119		0.118		0.118		0.118		0.118		0.118		0.118		0.118		0.118		0.118		0.119
1991		0.077			0.102			0.087		0.080		0.063		0.076		0.085		0.094		0.095		0.105		0.106		0.105		0.106		0.107		0.107		0.107		0.107		0.107		0.107		0.107
1992		0.353			0.247			0.224		0.214		0.210		0.213		0.215		0.216		0.193		0.186		0.186		0.185		0.184		0.184		0.184		0.180		0.180		0.181		0.183
1993		0.908			0.280			0.268		0.300		0.301		0.314		0.341		0.340		0.326		0.317		0.316		0.312		0.307		0.310		0.308		0.308		0.308		0.308
1994		0.007			0.204			0.169		0.189		0.189		0.179		0.150		0.152		0.203		0.203		0.202		0.203		0.203		0.203		0.203		0.204		0.204
1995		0.026			0.164			0.112		0.127		0.127		0.147		0.176		0.180		0.183		0.195		0.195		0.194		0.194		0.194		0.195		0.195
1996		0.086			0.643			0.461		0.425		0.435		0.440		0.433		0.395		0.392		0.403		0.404		0.406		0.407		0.436		0.437
1997		0.112			0.070			0.084		0.090		0.096		0.101		0.086		0.109		0.110		0.124		0.137		0.137		0.137		0.138
1998		0.317			0.038			0.065		0.076		0.097		0.143		0.146		0.159		0.158		0.159		0.174		0.174		0.176
1999		0.090			0.041			0.037		0.033		0.034		0.037		0.039		0.039		0.345		0.369		0.334		0.333
2000		(0.002	)		(0.002	)		0.007		0.007		0.050		0.052		0.056		0.059		0.068		0.068		0.074
2001		0.000			0.079			0.040		0.038		0.053		0.055		0.315		0.315		0.315		0.314
2002		0.000			0.007			0.026		0.028		0.029		0.048		0.049		0.043		0.045
2003		0.003			0.003			0.004		0.081		0.077		0.074		0.075		0.099
2004		0.000			0.011			0.015		0.014		0.052		0.184		0.183
2005		0.000			0.000			0.017		0.025		0.024		0.677
2006		0.000			0.003			0.006		0.015		0.678
2007		0.000			0.041			0.035		0.071
2008		0.000			0.010			0.048
2009		0.000			0.118
2010		0.000
*  Last Diagonal is as of 9/30/10. Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 & Delphi in 2009.
Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors**
Year	12 - 24			24 - 36			36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		0.949			0.999			1.045		1.030		0.991		0.956		1.007		1.027		0.999		0.988		1.016		0.985		1.020		0.992		0.989		0.998		0.989		0.992		0.986		0.986		0.989		0.981		1.075
1988		0.325			0.648			0.983		0.959		1.026		1.018		1.071		0.956		0.992		1.044		0.993		1.001		1.002		1.001		1.000		1.000		1.001		1.021		1.000		1.000		1.000		1.000
1989		0.407			1.340			1.633		0.963		0.777		1.134		2.717		1.000		0.997		1.005		1.004		0.999		1.001		1.001		0.999		1.004		1.000		1.001		1.000		1.000		1.000
1990		0.357			1.776			7.523		0.901		1.066		1.249		1.238		1.131		1.016		1.010		0.995		0.999		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.009
1991		1.324			0.854			0.920		0.781		1.205		1.117		1.111		1.011		1.102		1.009		0.999		1.001		1.009		1.000		1.002		1.000		1.000		1.000		1.000
1992		0.699			0.907			0.956		0.981		1.015		1.010		1.001		0.895		0.966		1.000		0.992		0.997		1.000		1.000		0.976		1.000		1.008		1.010
1993		0.308			0.959			1.118		1.004		1.044		1.084		0.999		0.958		0.973		0.996		0.989		0.982		1.012		0.993		1.000		1.000		1.000
1994		29.219			0.831			1.116		1.001		0.947		0.837		1.012		1.339		0.999		0.997		1.002		1.003		1.002		1.000		1.002		1.000
1995		6.385			0.687			1.128		0.999		1.159		1.201		1.018		1.018		1.067		1.001		0.995		1.000		1.000		1.002		1.000
1996		7.487			0.717			0.922		1.023		1.012		0.985		0.911		0.994		1.027		1.004		1.003		1.004		1.072		1.000
1997		0.629			1.187			1.080		1.059		1.061		0.846		1.276		1.007		1.125		1.103		1.003		1.000		1.007
1998		0.120			1.720			1.164		1.275		1.473		1.022		1.093		0.993		1.008		1.091		1.002		1.009
1999		0.452			0.900			0.909		1.022		1.099		1.039		1.004		8.861		1.070		0.903		1.000
2000		1.257			(2.991	)		0.989		7.600		1.049		1.072		1.056		1.158		1.000		1.112
2001					0.501			0.959		1.382		1.036		5.759		0.999		1.000		0.999
2002					3.542			1.065		1.058		1.640		1.034		0.879		1.036
2003		0.901			1.281			19.977		0.950		0.972		1.009		1.440
2004					1.379			0.910		3.792		3.501		0.997
2005								1.500		0.930		88.225
2006					2.055			2.426		164.687
2007					0.851			2.585
2008					8.078
2009
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		3.388			1.344			2.424		9.670		5.805		1.298		1.167		1.524		1.023		1.019		0.999		0.998		1.011		0.999		0.996		1.000		1.000		1.004		0.997		0.999		0.996		0.990		1.075
Average x 87		3.562			1.361			2.493		10.125		6.072		1.318		1.177		1.557		1.024		1.021		0.998		1.000		1.010		1.000		0.997		1.001		1.002		1.006		1.000		1.003		1.000		1.000
Average x H/L		1.652			1.218			1.580		1.552		1.253		1.048		1.082		1.045		1.019		1.021		0.999		0.999		1.006		1.000		0.999		1.000		1.000		1.003		1.000		1.000		1.000
Avg L5 x H/L		N/A			1.571			2.170		1.933		2.059		1.038		1.020		1.065		1.026		1.066		1.002		1.002		1.007		1.000		1.001		1.000		1.000		1.004		1.000
Selected		3.103			1.571			2.170		1.552		1.253		1.048		1.082		1.045		1.019		1.021		1.002		1.002		1.005		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult			24-Ult			36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		25.631			8.260			5.258		2.423		1.561		1.246		1.189		1.099		1.052		1.032		1.011		1.009		1.007		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult			21-Ult			33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		41.616			10.963			5.887		2.941		1.742		1.318		1.203		1.121		1.064		1.037		1.016		1.010		1.008		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit F6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Losses* ($000s)

	(1)		(2)		(3)		(4)		(5)
					[(1)*(2)]				[(3) * (4)]
									Projected
			Cumulative						Ultimate
			Ratio		Projected		Gross		Loss
			Development		Ultimate		Ultimate		Salvage
Accident	Ratio		Factors		Ratio		Losses		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1987 & Prior		0.194		1.000		0.194		93,533		18,145
1988		0.183		1.000		0.183		4,530		829
1989		0.282		1.000		0.282		8,351		2,355
1990		0.119		1.000		0.119		17,984		2,140
1991		0.107		1.000		0.107		10,544		1,128
1992		0.183		1.000		0.183		3,613		661
1993		0.308		1.000		0.308		3,766		1,160
1994		0.204		1.000		0.204		3,268		667
1995		0.195		1.000		0.195		2,870		560
1996		0.437		1.001		0.437		6,558		2,866
1997		0.138		1.003		0.138		2,643		365
1998		0.176		1.008		0.177		7,962		1,409
1999		0.333		1.010		0.337		22,855		7,702
2000		0.074		1.016		0.075		25,225		1,892
2001		0.314		1.037		0.326		20,649		6,732
2002		0.045		1.064		0.047		2,337		110
2003		0.099		1.121		0.111		28,672		3,183
2004		0.183		1.203		0.221		2,328		514
2005		0.677		1.318		0.892		2,082		1,857
2006		0.678		1.742		1.181		1,117		1,319
2007		0.071		2.941		0.209		1,182		247
2008		0.048		5.887		0.283		1,731		490
2009		0.118		10.963		1.290		1,558		2,010
2010		0.000		41.616		N/A		1,344		N/A
Total								276,702		58,341

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 & Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit F7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Selection of Ultimate Loss Salvage & Subrogation* ($000s)

			Ultimate		Ultimate		Ultimate
			Salvage		Salvage		Salvage				Selected
	Gross		Indicated by		Indicated by		Indicated by				Ultimate
	Ultimate		Dollar		Ratio		Bornhuetter-		Selected		Salvage
Accident	Losses		Development		Development		Ferguson		Ultimate		to Ultimate
Year	@9/30/10		Method		Method		Method		Salvage		Loss Ratio
1987 & Prior		93,533		16,786		18,145		xxx		16,786		0.179
1988		4,530		829		829		xxx		829		0.183
1989		8,351		2,352		2,355		xxx		2,354		0.282
1990		17,984		2,136		2,140		xxx		2,138		0.119
1991		10,544		1,122		1,128		xxx		1,125		0.107
1992		3,613		657		661		xxx		659		0.182
1993		3,766		1,160		1,160		xxx		1,160		0.308
1994		3,268		665		667		xxx		666		0.204
1995		2,870		557		560		xxx		559		0.195
1996		6,558		2,855		2,866		xxx		2,861		0.436
1997		2,643		364		365		xxx		365		0.138
1998		7,962		1,308		1,409		xxx		1,359		0.171
1999		22,855		7,634		7,702		xxx		7,668		0.336
2000		25,225		1,876		1,892		xxx		1,884		0.075
2001		20,649		6,588		6,732		xxx		6,588		0.319
2002		2,337		107		110		xxx		109		0.047
2003		28,672		3,117		3,183		xxx		3,150		0.110
2004		2,328		471		514		xxx		493		0.212
2005		2,082		1,783		1,857		1,390		1,390		0.668
2006		1,117		964		1,319		620		620		0.555
2007		1,182		96		247		185		185		0.157
2008		1,731		67		490		284		284		0.164
2009		1,558		53		2,010		283		283		0.182
2010		1,344		N/A		N/A		xxx		225		0.167
Total		276,702		53,547		58,341				53,740		0.194

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 & Delphi in 2009.
Note: Ultimate Salvage & Subrogation for 2010 is based on an Ultimate Sal/Sub Ratio of 16.7%, which is the weighted average of 2007-2009.

Milliman

WSC Assumed Business
Exhibit F8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
GROSS COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss Salvage & Subrogation* ($000s)

	Selected		Salvage		Indicated
Accident	Ultimate		Recovered		Salvage
Year	Salvage		@9/30/10		Recoverable
1987 & Prior		16,786		16,769		17
1988		829		827		2
1989		2,354		2,345		9
1990		2,138		2,127		11
1991		1,125		1,116		9
1992		659		652		7
1993		1,160		1,150		10
1994		666		658		8
1995		559		551		8
1996		2,861		2,818		43
1997		365		358		7
1998		1,359		1,276		83
1999		7,668		7,433		235
2000		1,884		1,816		68
2001		6,588		6,256		332
2002		109		99		10
2003		3,150		2,703		447
2004		493		379		114
2005		1,390		1,270		120
2006		620		516		104
2007		185		35		150
2008		284		15		269
2009		283		6		277
2010		225		0		225
Total		53,740		51,175		2,565

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 & Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit G1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		52,673		55,937		60,979		148,178		148,906		149,526		149,785		151,216		151,209		151,006		151,015		151,211		151,191		151,191		151,191		151,311		151,631		152,099		152,511		152,241		152,434		152,314		152,434		152,508
1988		0		509		14,290		15,187		15,317		15,547		15,635		15,968		15,968		15,968		15,968		16,138		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188
1989		514		13,779		14,750		15,600		16,530		16,987		16,860		17,135		17,135		17,217		17,967		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,580		18,790
1990		3,359		9,855		16,880		20,487		21,942		22,187		22,472		22,784		22,820		23,350		23,429		23,429		23,436		23,436		23,471		23,471		23,471		23,471		23,471		23,471		23,471
1991		4,604		20,478		29,997		31,660		32,399		33,687		33,950		34,491		34,745		35,525		35,558		35,607		35,607		35,607		35,607		35,607		35,607		35,607		35,607		35,607
1992		7,039		17,195		34,571		41,804		47,282		30,363		41,500		40,859		41,055		41,055		41,055		41,055		41,375		41,375		41,561		41,561		41,561		41,561		41,561
1993		2,428		44,390		66,055		70,898		64,705		69,903		69,854		70,347		70,701		70,702		71,284		71,284		71,284		70,982		70,982		71,002		71,002		71,062
1994		3,240		23,962		38,518		42,222		44,016		45,142		49,963		50,172		51,957		52,047		52,047		52,047		52,505		52,505		52,505		52,505		52,505
1995		726		11,524		15,991		17,272		17,391		17,688		17,743		17,943		18,055		18,280		18,280		18,280		18,280		18,283		18,283		18,283
1996		5,489		9,165		10,734		11,261		11,640		12,097		12,097		12,162		12,156		12,156		12,156		12,156		12,156		12,156		12,156
1997		4,361		6,784		8,219		8,401		8,819		8,926		9,881		9,881		9,881		9,906		9,909		9,909		9,909		9,909
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*  Last Diagonal is as of 9/30/10.
Accident	Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.062		1.090		2.430		1.005		1.004		1.002		1.010		1.000		0.999		1.000		1.001		1.000		1.000		1.000		1.001		1.002		1.003		1.003		0.998		1.001		0.999		1.001		1.001
1988		N/A		28.075		1.063		1.009		1.015		1.006		1.021		1.000		1.000		1.000		1.011		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		26.807		1.070		1.058		1.060		1.028		0.993		1.016		1.000		1.005		1.044		1.029		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.005		1.015
1990		2.934		1.713		1.214		1.071		1.011		1.013		1.014		1.002		1.023		1.003		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1991		4.448		1.465		1.055		1.023		1.040		1.008		1.016		1.007		1.022		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		2.443		2.011		1.209		1.131		0.642		1.367		0.985		1.005		1.000		1.000		1.000		1.008		1.000		1.004		1.000		1.000		1.000		1.000
1993		18.283		1.488		1.073		0.913		1.080		0.999		1.007		1.005		1.000		1.008		1.000		1.000		0.996		1.000		1.000		1.000		1.001
1994		7.396		1.607		1.096		1.042		1.026		1.107		1.004		1.036		1.002		1.000		1.000		1.009		1.000		1.000		1.000		1.000
1995		15.873		1.388		1.080		1.007		1.017		1.003		1.011		1.006		1.012		1.000		1.000		1.000		1.000		1.000		1.000
1996		1.670		1.171		1.049		1.034		1.039		1.000		1.005		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.556		1.212		1.022		1.050		1.012		1.107		1.000		1.000		1.003		1.000		1.000		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		8.247		3.844		1.214		1.031		0.992		1.055		1.008		1.005		1.006		1.005		1.004		1.002		1.000		1.001		1.000		1.000		1.001		1.000		1.000		1.002		1.005		1.000		1.001
Average x 87		9.045		4.120		1.092		1.034		0.991		1.060		1.008		1.006		1.007		1.006		1.004		1.002		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.002		1.008		1.000
Average x H/L		6.825		1.460		1.100		1.033		1.021		1.027		1.009		1.003		1.005		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.000
Avg L5 x H/L		8.313		1.362		1.068		1.028		1.027		1.037		1.006		1.004		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Average		2.530		1.456		1.360		1.014		0.984		1.042		1.007		1.006		1.003		1.003		1.002		1.002		0.999		1.001		1.000		1.001		1.002		1.001		0.999		1.001		1.001		1.001		1.001
WA x 1987		4.964		1.586		1.099		1.019		0.973		1.064		1.006		1.009		1.006		1.005		1.002		1.003		0.999		1.001		1.000		1.000		1.000		1.000		1.000		1.002		1.008		1.000
Wtd Avg L5		5.899		1.456		1.076		0.977		1.049		1.038		1.006		1.014		1.002		1.004		1.000		1.003		0.998		1.001		1.000		1.000		1.000		1.000		0.999
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.010		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.010		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.000

Milliman

WSC Assumed Business
Exhibit G2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

																			Indicated
							Cumulative												Ultimate
Accident	Paid Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		152,314		152,434		152,508		1.002		1.001		1.000		152,619		152,586		152,508		152,508
1988		16,188		16,188		16,188		1.003		1.002		1.001		16,237		16,220		16,204		16,204
1989		18,480		18,580		18,790		1.004		1.003		1.002		18,554		18,636		18,828		18,828
1990		23,471		23,471		23,471		1.005		1.004		1.003		23,588		23,565		23,541		23,541
1991		35,607		35,607		35,607		1.006		1.005		1.004		35,821		35,785		35,749		35,749
1992		41,561		41,561		41,561		1.007		1.006		1.005		41,852		41,810		41,769		41,769
1993		71,002		71,002		71,062		1.008		1.007		1.006		71,570		71,499		71,488		71,488
1994		52,505		52,505		52,505		1.009		1.008		1.007		52,978		52,925		52,873		52,873
1995		18,283		18,283		18,283		1.010		1.009		1.008		18,466		18,448		18,429		18,429
1996		12,156		12,156		12,156		N/A		1.010		1.009		N/A		12,278		12,265		12,265
1997		9,909		9,909		9,909		N/A		N/A		1.010		N/A		N/A		10,008		10,008

Milliman

WSC Assumed Business
Exhibit G3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Incurred Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		58,866		61,482		65,470		153,506		152,018		150,010		150,091		152,072		151,680		151,087		151,131		151,381		151,336		151,191		151,191		151,312		152,391		152,391		152,891		152,810		152,810		152,843		153,588		153,668
1988		0		685		15,068		15,626		15,659		15,701		15,733		16,135		16,093		15,968		15,968		16,138		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188
1989		518		15,195		16,541		16,589		16,951		17,524		17,268		17,207		17,547		18,306		18,032		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,480		19,480		19,480
1990		6,128		13,815		20,515		22,327		22,955		23,823		25,861		26,308		26,783		26,712		26,467		25,777		23,439		23,487		23,487		23,487		23,471		23,471		23,471		23,471		23,471
1991		7,094		26,510		34,247		36,460		37,936		35,891		35,360		35,117		35,329		35,796		36,236		35,609		35,609		35,609		35,607		35,607		35,607		35,607		35,607		35,607
1992		8,736		22,441		47,248		46,474		49,711		33,948		43,141		41,547		41,531		41,292		40,994		41,643		41,386		41,386		41,571		41,564		41,564		41,561		41,561
1993		3,525		61,567		74,150		79,041		73,640		72,948		71,477		70,496		70,639		70,539		70,951		70,914		70,876		70,986		70,982		71,002		71,002		71,062
1994		8,981		29,359		47,123		47,443		45,248		44,875		49,928		49,739		51,016		51,033		49,838		51,015		52,505		52,505		52,505		52,505		52,505
1995		4,098		17,395		19,583		18,263		18,112		18,030		17,994		18,197		18,174		18,300		18,289		18,281		18,280		18,283		18,283		18,283
1996		6,250		11,167		12,182		11,952		11,926		12,337		12,226		12,290		12,284		12,284		12,304		12,304		13,176		13,176		13,176
1997		6,126		7,916		12,828		11,253		12,200		12,213		10,097		10,006		9,881		9,906		9,909		9,909		9,909		9,909
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*     Last Diagonal is as of 9/30/10.
Accident	Incurred Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.044		1.065		2.345		0.990		0.987		1.001		1.013		0.997		0.996		1.000		1.002		1.000		0.999		1.000		1.001		1.007		1.000		1.003		0.999		1.000		1.000		1.005		1.001
1988		N/A		21.997		1.037		1.002		1.003		1.002		1.026		0.997		0.992		1.000		1.011		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		29.334		1.089		1.003		1.022		1.034		0.985		0.996		1.020		1.043		0.985		1.025		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.054		1.000
1990		2.254		1.485		1.088		1.028		1.038		1.086		1.017		1.018		0.997		0.991		0.974		0.909		1.002		1.000		1.000		0.999		1.000		1.000		1.000		1.000
1991		3.737		1.292		1.065		1.040		0.946		0.985		0.993		1.006		1.013		1.012		0.983		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		2.569		2.105		0.984		1.070		0.683		1.271		0.963		1.000		0.994		0.993		1.016		0.994		1.000		1.004		1.000		1.000		1.000		1.000
1993		17.466		1.204		1.066		0.932		0.991		0.980		0.986		1.002		0.999		1.006		0.999		0.999		1.002		1.000		1.000		1.000		1.001
1994		3.269		1.605		1.007		0.954		0.992		1.113		0.996		1.026		1.000		0.977		1.024		1.029		1.000		1.000		1.000		1.000
1995		4.245		1.126		0.933		0.992		0.995		0.998		1.011		0.999		1.007		0.999		1.000		1.000		1.000		1.000		1.000
1996		1.787		1.091		0.981		0.998		1.034		0.991		1.005		1.000		1.000		1.002		1.000		1.071		1.000		1.000
1997		1.292		1.621		0.877		1.084		1.001		0.827		0.991		0.988		1.003		1.000		1.000		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		6.700		3.244		1.126		1.010		0.973		1.022		1.000		1.005		1.004		0.997		1.003		1.000		1.000		1.000		1.000		1.001		1.000		1.001		1.000		1.014		1.000		1.002		1.001
Average x 87		7.328		3.461		1.004		1.012		0.972		1.024		0.999		1.005		1.005		0.996		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.018		1.000		1.000
Average x H/L		4.577		1.402		1.018		1.011		0.998		1.016		1.001		1.004		1.001		0.997		1.004		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		3.100		1.312		0.974		0.981		0.996		0.990		0.997		1.000		1.001		1.000		1.000		1.010		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Average		2.425		1.364		1.258		0.994		0.958		1.027		1.000		1.004		1.001		0.998		1.003		0.999		1.000		1.000		1.000		1.003		1.000		1.002		1.000		1.005		1.000		1.004		1.001
WA x 1987		4.004		1.453		1.020		0.996		0.944		1.041		0.993		1.008		1.003		0.996		1.004		0.999		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.017		1.000		1.000
Wtd Avg L5		4.396		1.302		1.013		0.959		0.996		1.008		0.994		1.008		1.000		0.995		1.007		1.014		1.001		1.001		1.000		1.000		1.000		1.000		1.000
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.001		1.001		1.001

9-Ult

21-Ult

33-Ult

45-Ult

57-Ult

69-Ult

81-Ult

93-Ult

105-Ult

117-Ult

129-Ult

141-Ult

153-Ult

165-Ult

177-Ult

189-Ult

201-Ult

213-Ult

225-Ult

237-Ult

249-Ult

261-Ult

273-Ult

285-Ult

Sep Cumulatives

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

1.008

1.007

1.006

1.005

1.004

1.003

1.002

1.001

1.001

1.001

1.001

Milliman

WSC Assumed Business
Exhibit G4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

																			Indicated
							Cumulative												Ultimate
Accident	Incurred Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		152,843		153,588		153,668		1.001		1.001		1.001		152,996		153,742		153,822		153,822
1988		16,188		16,188		16,188		1.001		1.001		1.001		16,204		16,204		16,204		16,204
1989		18,480		19,480		19,480		1.002		1.001		1.001		18,517		19,499		19,499		19,499
1990		23,471		23,471		23,471		1.003		1.002		1.001		23,541		23,518		23,494		23,494
1991		35,607		35,607		35,607		1.004		1.003		1.002		35,749		35,714		35,678		35,678
1992		41,564		41,561		41,561		1.005		1.004		1.003		41,772		41,727		41,686		41,686
1993		71,002		71,002		71,062		1.006		1.005		1.004		71,428		71,357		71,346		71,346
1994		52,505		52,505		52,505		1.007		1.006		1.005		52,873		52,820		52,768		52,768
1995		18,283		18,283		18,283		1.008		1.007		1.006		18,429		18,411		18,393		18,393
1996		13,176		13,176		13,176		N/A		1.008		1.007		N/A		13,281		13,268		13,268
1997		9,909		9,909		9,909		N/A		N/A		1.008		N/A		N/A		9,988		9,988

Milliman

WSC Assumed Business
Exhibit G5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1987-1997 Ultimate Losses ($000s)

	Incurred		Indicated Ultimate Losses Based on				Selected
Accident	Losses		Paid Loss		Incurred Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1987&Prior		153,668		152,508		153,822		153,822
1988		16,188		16,204		16,204		16,204
1989		19,480		18,828		19,499		19,499
1990		23,471		23,541		23,494		23,494
1991		35,607		35,749		35,678		35,678
1992		41,561		41,769		41,686		41,686
1993		71,062		71,488		71,346		71,346
1994		52,505		52,873		52,768		52,768
1995		18,283		18,429		18,393		18,393
1996		13,176		12,265		13,268		13,268
1997		9,909		10,008		9,988		9,988
Total		454,910		453,662		456,146		456,146

Milliman

     WSC Assumed Business
Exhibit G6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Losses
Year	Losses		Losses		Losses		Outstanding		@9/30/10		@9/30/10
1987&Prior		153,822		152,508		153,668		1,160		154		1,314
1988		16,204		16,188		16,188		0		16		16
1989		19,499		18,790		19,480		690		19		709
1990		23,494		23,471		23,471		0		23		23
1991		35,678		35,607		35,607		0		71		71
1992		41,686		41,561		41,561		0		125		125
1993		71,346		71,062		71,062		0		284		284
1994		52,768		52,505		52,505		0		263		263
1995		18,393		18,283		18,283		0		110		110
1996		13,268		12,156		13,176		1,020		92		1,112
1997		9,988		9,909		9,909		0		79		79
Total		456,146		452,040		454,910		2,870		1,236		4,106

Milliman

WSC Assumed Business
Exhibit G7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		4,554		5,135		6,011		17,108		17,560		17,941		17,700		17,834		17,962		18,086		18,154		18,187		18,225		18,225		18,227		18,227		18,232		18,232		18,232		18,220		18,220		18,220		18,220		18,220
1988		0		39		982		1,296		1,338		1,351		1,481		1,578		1,664		1,691		1,697		1,753		1,756		1,756		1,756		1,756		1,756		1,756		1,756		1,756		1,756		1,756		1,756
1989		17		670		965		1,296		1,798		1,944		2,385		2,575		2,627		2,662		2,709		2,793		2,793		2,794		2,794		2,794		2,794		2,794		2,794		2,794		2,794		2,807
1990		147		1,118		1,877		2,325		2,798		3,218		3,438		3,958		4,232		4,412		4,452		4,471		4,562		4,600		4,614		4,616		4,631		4,631		4,631		4,631		4,631
1991		334		1,047		1,624		2,288		3,409		4,130		4,401		4,526		4,686		4,744		4,791		4,813		4,819		4,843		4,848		4,849		4,851		4,865		4,869		4,872
1992		357		1,412		3,442		4,354		6,300		5,892		8,136		8,106		8,168		8,247		8,351		8,430		8,435		8,437		8,437		8,437		8,437		8,437		8,437
1993		363		1,503		3,098		5,577		6,507		7,050		7,210		7,337		7,400		7,438		7,449		7,454		7,465		7,501		7,512		7,512		7,512		7,512
1994		19		944		2,372		3,922		4,655		4,686		5,536		5,747		5,841		5,851		5,858		5,858		5,858		5,858		5,858		5,858		5,858
1995		222		1,370		2,051		2,475		2,586		2,680		2,769		2,899		2,935		2,952		2,974		2,992		2,992		2,992		2,992		2,992
1996		97		566		1,018		1,119		1,207		1,362		1,454		1,498		1,542		1,592		1,614		1,645		1,728		1,786		1,828
1997		306		658		1,004		1,241		1,502		1,657		1,707		1,754		1,829		1,901		1,921		1,938		1,938		1,938
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*  Last Diagonal is as of 9/30/10.
Accident	Paid ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.128		1.171		2.846		1.026		1.022		0.987		1.008		1.007		1.007		1.004		1.002		1.002		1.000		1.000		1.000		1.000		1.000		1.000		0.999		1.000		1.000		1.000		1.000
1988		N/A		25.179		1.320		1.032		1.010		1.096		1.065		1.054		1.016		1.004		1.033		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		39.412		1.440		1.343		1.387		1.081		1.227		1.080		1.020		1.013		1.018		1.031		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.006
1990		7.605		1.679		1.239		1.203		1.150		1.068		1.151		1.069		1.043		1.009		1.004		1.020		1.008		1.003		1.000		1.003		1.000		1.000		1.000		1.000
1991		3.135		1.551		1.409		1.490		1.211		1.066		1.028		1.035		1.012		1.010		1.005		1.001		1.005		1.001		1.000		1.000		1.003		1.001		1.001
1992		3.955		2.438		1.265		1.447		0.935		1.381		0.996		1.008		1.010		1.013		1.009		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1993		4.140		2.061		1.800		1.167		1.083		1.023		1.018		1.009		1.005		1.001		1.001		1.001		1.005		1.001		1.000		1.000		1.000
1994		49.684		2.513		1.653		1.187		1.007		1.181		1.038		1.016		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1995		6.171		1.497		1.207		1.045		1.036		1.033		1.047		1.012		1.006		1.007		1.006		1.000		1.000		1.000		1.000
1996		5.835		1.799		1.099		1.079		1.128		1.068		1.030		1.029		1.032		1.014		1.019		1.050		1.034		1.031
1997		2.150		1.526		1.236		1.210		1.103		1.030		1.028		1.043		1.039		1.011		1.009		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		12.322		3.896		1.492		1.207		1.070		1.105		1.044		1.028		1.017		1.008		1.011		1.007		1.005		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.002		1.000		1.000
Average x 87		13.565		4.168		1.357		1.225		1.075		1.117		1.048		1.030		1.018		1.009		1.012		1.008		1.005		1.004		1.000		1.001		1.000		1.000		1.000		1.000		1.003		1.000
Average x H/L		9.051		1.834		1.386		1.195		1.069		1.088		1.038		1.025		1.016		1.008		1.010		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		5.382		1.795		1.365		1.144		1.074		1.044		1.032		1.019		1.014		1.006		1.005		1.000		1.002		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Average		2.254		1.690		1.759		1.155		1.045		1.083		1.028		1.019		1.012		1.007		1.006		1.004		1.003		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.000		1.000
WA x 1987		5.009		1.976		1.405		1.240		1.058		1.134		1.038		1.024		1.014		1.008		1.008		1.005		1.004		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.004		1.000
Wtd Avg L5		5.006		1.893		1.502		1.148		1.059		1.071		1.030		1.016		1.010		1.004		1.004		1.005		1.005		1.003		1.000		1.001		1.000		1.000		1.000
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.005		1.004		1.002		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.009		1.005		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.010		1.006		1.004		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit G8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Paid ALAE Projection

																			Indicated
							Cumulative												Ultimate
Accident	Paid ALAE ($000s)						Development Factors						Indicated Ultimate ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		18,220		18,220		18,220		1.000		1.000		1.000		18,220		18,220		18,220		18,220
1988		1,756		1,756		1,756		1.000		1.000		1.000		1,756		1,756		1,756		1,756
1989		2,794		2,794		2,807		1.000		1.000		1.000		2,794		2,794		2,807		2,807
1990		4,631		4,631		4,631		1.000		1.000		1.000		4,631		4,631		4,631		4,631
1991		4,865		4,869		4,872		1.001		1.000		1.000		4,870		4,869		4,872		4,872
1992		8,437		8,437		8,437		1.002		1.001		1.000		8,454		8,445		8,437		8,437
1993		7,512		7,512		7,512		1.003		1.002		1.001		7,535		7,527		7,520		7,520
1994		5,858		5,858		5,858		1.005		1.003		1.002		5,887		5,876		5,870		5,870
1995		2,992		2,992		2,992		1.009		1.005		1.004		3,019		3,007		3,004		3,004
1996		1,728		1,786		1,828		N/A		1.009		1.006		N/A		1,802		1,839		1,839
1997		1,938		1,938		1,938		N/A		N/A		1.010		N/A		N/A		1,957		1,957

Milliman

WSC Assumed Business
Exhibit G9

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE/Paid Loss* + 1
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		1.086		1.092		1.099		1.115		1.118		1.120		1.118		1.118		1.119		1.120		1.120		1.120		1.121		1.121		1.121		1.120		1.120		1.120		1.120		1.120		1.120		1.120		1.120		1.119
1988		N/A		1.077		1.069		1.085		1.087		1.087		1.095		1.099		1.104		1.106		1.106		1.109		1.108		1.108		1.108		1.108		1.108		1.108		1.108		1.108		1.108		1.108		1.108
1989		1.033		1.049		1.065		1.083		1.109		1.114		1.141		1.150		1.153		1.155		1.151		1.151		1.151		1.151		1.151		1.151		1.151		1.151		1.151		1.151		1.150		1.149
1990		1.044		1.113		1.111		1.113		1.128		1.145		1.153		1.174		1.185		1.189		1.190		1.191		1.195		1.196		1.197		1.197		1.197		1.197		1.197		1.197		1.197
1991		1.073		1.051		1.054		1.072		1.105		1.123		1.130		1.131		1.135		1.134		1.135		1.135		1.135		1.136		1.136		1.136		1.136		1.137		1.137		1.137
1992		1.051		1.082		1.100		1.104		1.133		1.194		1.196		1.198		1.199		1.201		1.203		1.205		1.204		1.204		1.203		1.203		1.203		1.203		1.203
1993		1.150		1.034		1.047		1.079		1.101		1.101		1.103		1.104		1.105		1.105		1.104		1.105		1.105		1.106		1.106		1.106		1.106		1.106
1994		1.006		1.039		1.062		1.093		1.106		1.104		1.111		1.115		1.112		1.112		1.113		1.113		1.112		1.112		1.112		1.112		1.112
1995		1.306		1.119		1.128		1.143		1.149		1.152		1.156		1.162		1.163		1.161		1.163		1.164		1.164		1.164		1.164		1.164
1996		1.018		1.062		1.095		1.099		1.104		1.113		1.120		1.123		1.127		1.131		1.133		1.135		1.142		1.147		1.150
1997		1.070		1.097		1.122		1.148		1.170		1.186		1.173		1.178		1.185		1.192		1.194		1.196		1.196		1.196
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*     Last Diagonal is as of 9/30/10.
Accident	Paid ALAE/Paid Loss + 1 Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.005		1.006		1.015		1.002		1.002		0.998		1.000		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1988		N/A		0.993		1.016		1.002		1.000		1.007		1.004		1.005		1.002		1.000		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		1.015		1.016		1.017		1.024		1.005		1.024		1.008		1.003		1.001		0.997		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		0.999		0.999
1990		1.067		0.998		1.002		1.013		1.016		1.007		1.018		1.010		1.003		1.001		1.001		1.003		1.001		1.000		1.000		1.001		1.000		1.000		1.000		1.000
1991		0.980		1.003		1.017		1.031		1.016		1.006		1.001		1.003		0.999		1.001		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1992		1.030		1.016		1.004		1.026		1.054		1.002		1.002		1.000		1.002		1.002		1.002		0.999		1.000		0.999		1.000		1.000		1.000		1.000
1993		0.899		1.013		1.030		1.020		1.000		1.002		1.001		1.000		1.000		0.999		1.000		1.000		1.001		1.000		1.000		1.000		1.000
1994		1.033		1.021		1.029		1.012		0.998		1.006		1.003		0.998		1.000		1.000		1.000		0.999		1.000		1.000		1.000		1.000
1995		0.857		1.008		1.013		1.005		1.002		1.004		1.005		1.001		0.999		1.001		1.001		1.000		1.000		1.000		1.000
1996		1.043		1.031		1.004		1.004		1.008		1.007		1.003		1.003		1.004		1.002		1.002		1.006		1.004		1.004
1997		1.025		1.023		1.023		1.020		1.013		0.989		1.004		1.006		1.006		1.002		1.001		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		0.995		1.012		1.016		1.014		1.010		1.005		1.004		1.003		1.001		1.000		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x 87		0.994		1.012		1.016		1.016		1.011		1.005		1.005		1.003		1.001		1.000		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		0.999		1.000
Average x H/L		1.004		1.012		1.015		1.014		1.007		1.004		1.003		1.003		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		0.986		1.019		1.022		1.012		1.004		1.004		1.003		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

     WSC Assumed Business
Exhibit G10

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	(1)		(2)		(3)
					[(1)x(2)]
	Paid ALAE/		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
Accident	Ratio		Factors for		Ratio
Year	@9/30/10		9/10-Ult		@9/30/10
1987&Prior		1.119		1.000		1.119
1988		1.108		1.000		1.108
1989		1.149		1.000		1.149
1990		1.197		1.000		1.197
1991		1.137		1.000		1.137
1992		1.203		1.000		1.203
1993		1.106		1.000		1.106
1994		1.112		1.000		1.112
1995		1.164		1.000		1.164
1996		1.150		1.000		1.150
1997		1.196		1.000		1.196

Milliman

WSC Assumed Business
Exhibit G11

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

						Selected						Selected		Ultimate
				Paid ALAE		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident		Paid		To Paid		Losses		Projection		Projection		ALAE		Ultimate
Year		ALAE		Loss Ratio		($000s)		($000s)		($000s)		($000s)		Loss Ratio
1987&Prior			18,220		0.119		153,822		18,305		18,220		18,220		0.1184
	1988		1,756		0.108		16,204		1,750		1,756		1,756		0.1084
	1989		2,807		0.149		19,499		2,905		2,807		2,807		0.1440
	1990		4,631		0.197		23,494		4,628		4,631		4,631		0.1971
	1991		4,872		0.137		35,678		4,888		4,872		4,872		0.1366
	1992		8,437		0.203		41,686		8,462		8,437		8,437		0.2024
	1993		7,512		0.106		71,346		7,563		7,520		7,520		0.1054
	1994		5,858		0.112		52,768		5,910		5,870		5,870		0.1112
	1995		2,992		0.164		18,393		3,016		3,004		3,004		0.1633
	1996		1,828		0.150		13,268		1,990		1,839		1,839		0.1386
	1997		1,938		0.196		9,988		1,958		1,957		1,957		0.1959
Total			60,851				456,146		61,375		60,913		60,913		0.1335

Milliman

WSC Assumed Business
Exhibit G12

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

		Paid		Ultimate		Unpaid
Accident		ALAE		ALAE		ALAE
Year		@9/30/10		@9/30/10		@9/30/10
1987&Prior			18,220		18,220		0
	1988		1,756		1,756		0
	1989		2,807		2,807		0
	1990		4,631		4,631		0
	1991		4,872		4,872		0
	1992		8,437		8,437		0
	1993		7,512		7,520		8
	1994		5,858		5,870		12
	1995		2,992		3,004		12
	1996		1,828		1,839		11
	1997		1,938		1,957		19
Total			60,851		60,913		62

Milliman

WSC Assumed Business
Exhibit G13

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

												Unpaid
Accident		Ultimate		Paid		Incurred		Case		IBNR		Loss & ALAE
Year		Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1987&Prior			172,042		170,728		171,888		1,160		154		1,314
	1988		17,960		17,944		17,944		0		16		16
	1989		22,306		21,597		22,287		690		19		709
	1990		28,125		28,102		28,102		0		23		23
	1991		40,550		40,479		40,479		0		71		71
	1992		50,123		49,998		49,998		0		125		125
	1993		78,866		78,574		78,574		0		292		292
	1994		58,638		58,363		58,363		0		275		275
	1995		21,397		21,275		21,275		0		122		122
	1996		15,107		13,984		15,004		1,020		103		1,123
	1997		11,945		11,847		11,847		0		98		98
Total			517,059		512,891		515,761		2,870		1,298		4,168

Milliman

WSC Assumed Business
Exhibit H1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Accident	Loss Salvage & Subrogation Recovered ($000s)*
Year	12			24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		7,962			8,452		9,057		15,974		16,653		17,222		18,447		19,302		19,464		19,547		19,738		20,082		20,197		20,330		20,331		20,374		20,375		20,376		20,383		20,406		20,406		20,406		20,406		20,406
1988		0			25		1,932		1,908		2,018		2,070		2,083		2,215		2,247		2,320		2,331		2,416		2,420		2,424		2,427		2,431		2,434		2,436		2,436		2,436		2,436		2,436		2,436
1989		0			1,345		1,741		1,641		1,247		1,325		1,506		1,510		1,665		1,924		1,958		1,996		2,136		2,137		2,139		2,140		2,141		2,143		2,601		2,603		2,603		2,603
1990		0			452		1,018		1,668		1,979		2,423		2,883		3,372		3,286		4,692		4,763		4,828		4,877		4,953		4,958		5,177		5,177		5,177		5,177		5,177		5,177
1991		102			290		551		1,096		1,433		2,042		2,303		3,336		3,531		3,660		3,697		3,719		3,834		3,844		3,985		4,040		4,059		4,078		4,100		4,105
1992		45			569		2,890		9,693		11,975		2,483		13,594		14,032		14,033		14,620		14,823		14,899		14,988		15,605		15,605		15,605		15,605		15,605		15,605
1993		3			11,616		31,407		33,775		35,749		37,476		39,648		39,923		40,400		40,796		40,344		40,344		40,347		40,538		40,759		40,759		40,759		40,759
1994		2,531			7,076		12,981		12,703		14,187		14,487		14,952		15,501		16,608		17,865		17,846		17,846		17,846		17,846		17,800		17,800		17,800
1995		7			1,296		2,899		9,051		10,523		10,647		10,747		10,853		10,933		11,509		11,753		11,754		11,754		11,754		11,757		11,757
1996		0			137		504		888		1,272		1,365		1,751		1,773		1,803		1,869		1,869		2,594		2,824		2,883		2,896
1997		(1	)		33		240		878		1,076		1,074		3,054		3,052		3,106		3,661		3,661		3,677		3,718		3,736
1998		0			0		0		0		0		0		0		0		0		0		0		0		0
1999		0			0		0		0		0		0		0		0		0		0		0		0
2000		0			0		0		0		0		0		0		0		0		0		0
2001		0			0		0		0		0		0		0		0		0		0
2002		0			0		0		0		0		0		0		0		0
2003		0			0		0		0		0		0		0		0
2004		0			0		0		0		0		0		0
2005		0			0		0		0		0		0
2006		0			0		0		0		0
2007		0			0		0		0
2008		0			0		0
2009		0			0
2010		0
*  Last Diagonal is as of 9/30/10.
Accident	Salvage & Subrogation Recovered Development Factors**
Year	12 - 24			24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		1.062			1.072		1.764		1.043		1.034		1.071		1.046		1.008		1.004		1.010		1.017		1.006		1.007		1.000		1.002		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000
1988					77.280		0.988		1.058		1.026		1.006		1.063		1.014		1.032		1.005		1.036		1.002		1.002		1.001		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000
1989					1.294		0.943		0.760		1.063		1.137		1.003		1.103		1.156		1.018		1.019		1.070		1.000		1.001		1.000		1.000		1.001		1.214		1.001		1.000		1.000
1990					2.252		1.639		1.186		1.224		1.190		1.170		0.974		1.428		1.015		1.014		1.010		1.016		1.001		1.044		1.000		1.000		1.000		1.000		1.000
1991		2.843			1.900		1.989		1.307		1.425		1.128		1.449		1.058		1.037		1.010		1.006		1.031		1.003		1.037		1.014		1.005		1.005		1.005		1.002
1992		12.644			5.079		3.354		1.235		0.207		5.475		1.032		1.000		1.042		1.014		1.005		1.006		1.041		1.000		1.000		1.000		1.000		1.000
1993		3,872.000			2.704		1.075		1.058		1.048		1.058		1.007		1.012		1.010		0.989		1.000		1.000		1.005		1.005		1.000		1.000		1.000
1994		2.796			1.835		0.979		1.117		1.021		1.032		1.037		1.071		1.076		0.999		1.000		1.000		1.000		0.997		1.000		1.000
1995		185.143			2.237		3.122		1.163		1.012		1.009		1.010		1.007		1.053		1.021		1.000		1.000		1.000		1.000		1.000
1996					3.679		1.762		1.432		1.073		1.283		1.013		1.017		1.037		1.000		1.388		1.089		1.021		1.006
1997		(33.000	)		7.273		3.658		1.226		0.998		2.844		0.999		1.018		1.179		1.000		1.004		1.011		1.006
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
**          Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		577.641			9.691		1.934		1.144		1.012		1.657		1.075		1.026		1.096		1.007		1.045		1.020		1.009		1.005		1.007		1.001		1.001		1.037		1.001		1.000		1.000		1.000		1.000
Average x 87		673.738			10.553		1.951		1.154		1.010		1.716		1.078		1.028		1.105		1.007		1.047		1.022		1.009		1.005		1.008		1.001		1.001		1.044		1.001		1.000		1.000		1.000
Average x H/L		40.898			3.139		1.852		1.155		1.055		1.306		1.042		1.023		1.069		1.008		1.011		1.015		1.007		1.002		1.003		1.000		1.000		1.001		1.001		1.000		1.000
Average L5		N/A			3.545		2.119		1.199		1.030		1.445		1.013		1.025		1.071		1.002		1.078		1.020		1.006		1.002		1.003		1.001		1.001		1.044		1.001
Wtd Average		2.938			2.084		1.369		1.099		0.944		1.198		1.035		1.019		1.046		1.003		1.011		1.006		1.009		1.003		1.003		1.000		1.000		1.010		1.001		1.000		1.000		1.000		1.000
Wtd Average x 87		8.500			2.459		1.305		1.111		0.926		1.227		1.033		1.021		1.054		1.001		1.010		1.006		1.009		1.003		1.003		1.000		1.000		1.016		1.001		1.000		1.000		1.000
Selected		N/A			N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.007		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.001
	12-Ult			24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A			N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.012		1.010		1.008		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.000
	9-Ult			21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A			N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.014		1.011		1.009		1.007		1.006		1.005		1.004		1.003		1.002		1.001		1.000

Milliman

WSC Assumed Business
Exhibit H2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Loss Salvage & Subrogation Recovered Development Projection Method ($000s)

		(1)		(2)		(3)
						[(1)*(2)]
						Projected
						Ultimate
				Cumulative		Loss
		Salvage		Development		Salvage
Accident		Recovered		Factors		Recovered
Year		@9/30/10		9/30/10-Ult		@9/30/10
1987 & Prior			20,406		1.000		20,406
	1988		2,436		1.001		2,438
	1989		2,603		1.002		2,608
	1990		5,177		1.003		5,193
	1991		4,105		1.004		4,121
	1992		15,605		1.005		15,683
	1993		40,759		1.006		41,004
	1994		17,800		1.007		17,925
	1995		11,757		1.009		11,863
	1996		2,896		1.011		2,928
	1997		3,736		1.014		3,788
Total			127,280				127,957

Milliman

WSC Assumed Business
Exhibit H3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses ($000s)*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		52,673		55,937		60,979		148,178		148,906		149,526		149,785		151,216		151,209		151,006		151,015		151,211		151,191		151,191		151,191		151,311		151,631		152,099		152,511		152,241		152,434		152,314		152,434		152,508
1988		0		509		14,290		15,187		15,317		15,547		15,635		15,968		15,968		15,968		15,968		16,138		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188		16,188
1989		514		13,779		14,750		15,600		16,530		16,987		16,860		17,135		17,135		17,217		17,967		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,480		18,580		18,790
1990		3,359		9,855		16,880		20,487		21,942		22,187		22,472		22,784		22,820		23,350		23,429		23,429		23,436		23,436		23,471		23,471		23,471		23,471		23,471		23,471		23,471
1991		4,604		20,478		29,997		31,660		32,399		33,687		33,950		34,491		34,745		35,525		35,558		35,607		35,607		35,607		35,607		35,607		35,607		35,607		35,607		35,607
1992		7,039		17,195		34,571		41,804		47,282		30,363		41,500		40,859		41,055		41,055		41,055		41,055		41,375		41,375		41,561		41,561		41,561		41,561		41,561
1993		2,428		44,390		66,055		70,898		64,705		69,903		69,854		70,347		70,701		70,702		71,284		71,284		71,284		70,982		70,982		71,002		71,002		71,062
1994		3,240		23,962		38,518		42,222		44,016		45,142		49,963		50,172		51,957		52,047		52,047		52,047		52,505		52,505		52,505		52,505		52,505
1995		726		11,524		15,991		17,272		17,391		17,688		17,743		17,943		18,055		18,280		18,280		18,280		18,280		18,283		18,283		18,283
1996		5,489		9,165		10,734		11,261		11,640		12,097		12,097		12,162		12,156		12,156		12,156		12,156		12,156		12,156		12,156
1997		4,361		6,784		8,219		8,401		8,819		8,926		9,881		9,881		9,881		9,906		9,909		9,909		9,909		9,909
1998		0		0		0		0		0		0		0		0		0		0		0		0		0
1999		0		0		0		0		0		0		0		0		0		0		0		0
2000		0		0		0		0		0		0		0		0		0		0		0
2001		0		0		0		0		0		0		0		0		0		0
2002		0		0		0		0		0		0		0		0		0
2003		0		0		0		0		0		0		0		0
2004		0		0		0		0		0		0		0
2005		0		0		0		0		0		0
2006		0		0		0		0		0
2007		0		0		0		0
2008		0		0		0
2009		0		0
2010		0

* Last Diagonal is as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit H4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Losses*
Year	12			24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		0.151			0.151		0.149		0.108		0.112		0.115		0.123		0.128		0.129		0.129		0.131		0.133		0.134		0.134		0.134		0.135		0.134		0.134		0.134		0.134		0.134		0.134		0.134		0.134
1988					0.049		0.135		0.126		0.132		0.133		0.133		0.139		0.141		0.145		0.146		0.150		0.149		0.150		0.150		0.150		0.150		0.150		0.150		0.150		0.150		0.150		0.150
1989		0.000			0.098		0.118		0.105		0.075		0.078		0.089		0.088		0.097		0.112		0.109		0.108		0.116		0.116		0.116		0.116		0.116		0.116		0.141		0.141		0.140		0.139
1990		0.000			0.046		0.060		0.081		0.090		0.109		0.128		0.148		0.144		0.201		0.203		0.206		0.208		0.211		0.211		0.221		0.221		0.221		0.221		0.221		0.221
1991		0.022			0.014		0.018		0.035		0.044		0.061		0.068		0.097		0.102		0.103		0.104		0.104		0.108		0.108		0.112		0.113		0.114		0.115		0.115		0.115
1992		0.006			0.033		0.084		0.232		0.253		0.082		0.328		0.343		0.342		0.356		0.361		0.363		0.362		0.377		0.375		0.375		0.375		0.375		0.375
1993		0.001			0.262		0.475		0.476		0.552		0.536		0.568		0.568		0.571		0.577		0.566		0.566		0.566		0.571		0.574		0.574		0.574		0.574
1994		0.781			0.295		0.337		0.301		0.322		0.321		0.299		0.309		0.320		0.343		0.343		0.343		0.340		0.340		0.339		0.339		0.339
1995		0.010			0.112		0.181		0.524		0.605		0.602		0.606		0.605		0.606		0.630		0.643		0.643		0.643		0.643		0.643		0.643
1996		0.000			0.015		0.047		0.079		0.109		0.113		0.145		0.146		0.148		0.154		0.154		0.213		0.232		0.237		0.238
1997		(0.000	)		0.005		0.029		0.105		0.122		0.120		0.309		0.309		0.314		0.370		0.369		0.371		0.375		0.377
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
*  Last Diagonal is as of 9/30/10.
Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors**
Year	12 - 24			24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		1.000			0.983		0.726		1.037		1.030		1.069		1.036		1.008		1.006		1.010		1.016		1.006		1.007		1.000		1.001		0.998		0.997		0.998		1.003		0.999		1.001		0.999		0.999
1988					2.753		0.929		1.049		1.011		1.001		1.041		1.014		1.032		1.005		1.026		0.999		1.002		1.001		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000
1989					1.209		0.891		0.717		1.034		1.145		0.987		1.103		1.150		0.975		0.991		1.070		1.000		1.001		1.000		1.000		1.001		1.214		1.001		0.995		0.985
1990					1.315		1.350		1.108		1.211		1.175		1.154		0.973		1.395		1.012		1.014		1.010		1.016		1.000		1.044		1.000		1.000		1.000		1.000		1.000
1991		0.639			1.297		1.885		1.278		1.370		1.119		1.426		1.051		1.014		1.009		1.005		1.031		1.003		1.037		1.014		1.005		1.005		1.005		1.002
1992		5.176			2.526		2.774		1.092		0.323		4.006		1.048		0.995		1.042		1.014		1.005		0.998		1.041		0.996		1.000		1.000		1.000		1.000
1993		211.787			1.817		1.002		1.160		0.970		1.059		1.000		1.007		1.010		0.981		1.000		1.000		1.009		1.005		1.000		1.000		0.999
1994		0.378			1.141		0.893		1.071		0.996		0.933		1.032		1.035		1.074		0.999		1.000		0.991		1.000		0.997		1.000		1.000
1995		11.664			1.612		2.891		1.155		0.995		1.006		0.999		1.001		1.040		1.021		1.000		1.000		1.000		1.000		1.000
1996					3.141		1.679		1.386		1.033		1.283		1.007		1.017		1.037		1.000		1.388		1.089		1.021		1.006
1997		(21.214	)		6.003		3.579		1.167		0.986		2.569		0.999		1.018		1.176		1.000		1.004		1.011		1.006
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
**          Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		29.919			2.163		1.691		1.111		0.996		1.488		1.066		1.020		1.089		1.002		1.041		1.019		1.009		1.004		1.007		1.001		1.000		1.036		1.001		0.998		0.995		1.000		0.999
Average x 87		34.738			2.281		1.787		1.118		0.993		1.529		1.069		1.021		1.097		1.002		1.043		1.020		1.010		1.005		1.007		1.001		1.001		1.044		1.001		0.998		0.993		1.000
Average x H/L		N/A			1.868		1.588		1.124		1.029		1.269		1.035		1.016		1.064		1.003		1.008		1.014		1.007		1.001		1.002		1.000		1.000		1.001		1.001		0.999		1.000
Avg L5 x H/L		N/A			2.190		1.857		1.161		0.992		1.116		1.002		1.014		1.050		1.000		1.001		1.004		1.005		1.001		1.000		1.000		1.000		1.002		1.001
Selected		N/A			N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.005		1.002		1.001		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000
	12-Ult			24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A			N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.007		1.005		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000
	9-Ult			21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A			N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.008		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit H5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Losses ($000s)

		(1)		(2)		(3)		(4)		(5)
						[(1)*(2)]				[(3) * (4)]
										Projected
				Cumulative						Ultimate
				Ratio		Projected		Net		Loss
				Development		Ultimate		Ultimate		Salvage
Accident		Ratio		Factors		Ratio		Losses		Recovered
Year		@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1987 & Prior			0.134		1.000		0.134		153,822		20,612
	1988		0.150		1.000		0.150		16,204		2,431
	1989		0.139		1.000		0.139		19,499		2,710
	1990		0.221		1.000		0.221		23,494		5,192
	1991		0.115		1.000		0.115		35,678		4,103
	1992		0.375		1.001		0.376		41,686		15,674
	1993		0.574		1.002		0.575		71,346		41,024
	1994		0.339		1.003		0.340		52,768		17,941
	1995		0.643		1.004		0.646		18,393		11,882
	1996		0.238		1.006		0.240		13,268		3,184
	1997		0.377		1.008		0.380		9,988		3,795
Total									456,146		128,548

Milliman

WSC Assumed Business
Exhibit H6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Selection of Ultimate Loss Salvage & Subrogation ($000s)

					Ultimate		Ultimate
					Salvage		Salvage				Selected
			Net		Indicated by		Indicated by				Ultimate
			Ultimate		Dollar		Ratio		Selected		Salvage
Accident			Losses		Development		Development		Ultimate		to Ultimate
Year			@9/30/10		Method		Method		Salvage		Loss Ratio
1987 & Prior				153,822		20,406		20,612		20,406		0.133
	1988			16,204		2,438		2,431		2,438		0.150
	1989			19,499		2,608		2,710		2,608		0.134
	1990			23,494		5,193		5,192		5,193		0.221
	1991			35,678		4,121		4,103		4,112		0.115
	1992			41,686		15,683		15,674		15,683		0.376
	1993			71,346		41,004		41,024		41,024		0.575
	1994			52,768		17,925		17,941		17,941		0.340
	1995			18,393		11,863		11,882		11,863		0.645
	1996			13,268		2,928		3,184		2,928		0.221
	1997	*		9,988		3,788		3,795		3,795		0.380
Total				456,146		127,957		128,548		127,991		0.281

* 1997 Year is from 1/1/97-9/30/97

Milliman

WSC Assumed Business
Exhibit H7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss Salvage & Subrogation ($000s)

			Selected		Salvage		Indicated
Accident			Ultimate		Recovered		Salvage
Year			Salvage		@9/30/10		Recoverable
1987 & Prior				20,406		20,406		0
	1988			2,438		2,436		2
	1989			2,608		2,603		5
	1990			5,193		5,177		16
	1991			4,112		4,105		7
	1992			15,683		15,605		78
	1993			41,024		40,759		265
	1994			17,941		17,800		141
	1995			11,863		11,757		106
	1996			2,928		2,896		32
	1997	*		3,795		3,736		59
Total				127,991		127,280		711

* 1997 Year is from 1/1/97-9/30/97

Milliman

WSC Assumed Business
Exhibit I1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		27,636		30,800		31,065		51,105		52,189		53,165		54,100		56,856		57,633		57,933		58,987		59,517		60,926		61,278		61,798		62,693		64,189		65,811		67,488		66,911		68,371		67,967		69,509		69,530
1988		49		548		2,109		2,591		3,185		3,374		3,561		3,574		4,006		4,050		4,061		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,096		4,096		4,096
1989		147		2,343		3,387		3,921		5,605		7,275		7,458		7,599		7,719		7,791		7,794		7,818		7,845		7,845		7,845		7,845		7,845		7,845		7,845		7,845		7,845		7,845
1990		3,044		5,874		6,903		7,676		12,526		11,432		11,719		11,749		11,805		11,805		11,809		11,928		11,939		11,939		11,939		11,939		11,939		11,939		11,939		11,939		11,939
1991		569		2,430		3,233		4,321		9,854		9,892		9,911		10,000		10,120		10,120		10,127		10,163		10,163		10,163		10,163		10,164		10,164		10,164		10,164		10,164
1992		275		1,585		2,095		2,462		2,728		2,922		3,051		3,080		3,471		3,471		3,471		3,472		3,482		3,482		3,483		3,570		3,570		3,570		3,570
1993		3,336		1,595		2,288		2,955		3,050		3,114		3,119		3,127		3,263		3,360		3,376		3,415		3,480		3,544		3,569		3,569		3,569		3,569
1994		166		848		1,809		2,474		2,560		2,810		2,970		2,993		3,000		3,014		3,023		3,023		3,024		3,024		3,024		3,024		3,024
1995		34		935		1,697		1,929		2,151		2,436		2,615		2,712		2,729		2,733		2,735		2,749		2,749		2,749		2,749		2,749
1996		606		2,996		4,377		4,841		5,334		5,424		5,663		6,287		6,344		6,347		6,347		6,347		6,347		6,347		6,363
1997		357		790		935		1,450		1,513		1,846		2,165		2,197		2,197		2,201		2,201		2,201		2,201		2,201
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*  Last Diagonal is as of 9/30/10.
Accident	Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		1.114		1.009		1.645		1.021		1.019		1.018		1.051		1.014		1.005		1.018		1.009		1.024		1.006		1.008		1.014		1.024		1.025		1.025		0.991		1.022		0.994		1.023		1.000
1988		11.184		3.849		1.229		1.229		1.059		1.055		1.004		1.121		1.011		1.003		1.008		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		15.939		1.446		1.158		1.429		1.298		1.025		1.019		1.016		1.009		1.000		1.003		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.930		1.175		1.112		1.632		0.913		1.025		1.003		1.005		1.000		1.000		1.010		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		4.271		1.330		1.337		2.280		1.004		1.002		1.009		1.012		1.000		1.001		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		5.764		1.322		1.175		1.108		1.071		1.044		1.010		1.127		1.000		1.000		1.000		1.003		1.000		1.000		1.025		1.000		1.000		1.000
1993		0.478		1.434		1.292		1.032		1.021		1.002		1.003		1.043		1.030		1.005		1.012		1.019		1.018		1.007		1.000		1.000		1.000
1994		5.108		2.133		1.368		1.035		1.098		1.057		1.008		1.002		1.005		1.003		1.000		1.000		1.000		1.000		1.000		1.000
1995		27.500		1.815		1.137		1.115		1.132		1.073		1.037		1.006		1.001		1.001		1.005		1.000		1.000		1.000		1.000
1996		4.944		1.461		1.106		1.102		1.017		1.044		1.110		1.009		1.000		1.000		1.000		1.000		1.000		1.003
1997		2.213		1.184		1.551		1.043		1.220		1.173		1.015		1.000		1.002		1.000		1.000		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**          Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		7.313		1.651		1.283		1.275		1.077		1.047		1.024		1.032		1.006		1.003		1.005		1.005		1.002		1.002		1.004		1.003		1.004		1.004		0.998		1.006		0.998		1.011		1.000
Average x 87		7.933		1.715		1.246		1.301		1.083		1.050		1.022		1.034		1.006		1.001		1.004		1.003		1.002		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		5.830		1.478		1.262		1.192		1.071		1.038		1.017		1.025		1.004		1.001		1.004		1.003		1.001		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		4.088		1.570		1.265		1.060		1.084		1.058		1.020		1.006		1.003		1.001		1.002		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Average		1.401		1.180		1.431		1.175		1.030		1.025		1.036		1.019		1.005		1.010		1.007		1.013		1.004		1.005		1.009		1.014		1.015		1.016		0.994		1.016		0.995		1.021		1.000
WA x 1987		2.324		1.446		1.201		1.401		1.042		1.034		1.021		1.025		1.004		1.001		1.005		1.002		1.001		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		1.592		1.550		1.229		1.070		1.070		1.058		1.047		1.013		1.007		1.002		1.003		1.004		1.004		1.002		1.004		1.000		1.000		1.000		0.994
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.002		1.002		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.023		1.021		1.019		1.017		1.015		1.014		1.013		1.012		1.011		1.010		1.010
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.024		1.022		1.020		1.018		1.016		1.014		1.013		1.012		1.011		1.010		1.010

Milliman

WSC Assumed Business
Exhibit I2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

																				Indicated
								Cumulative												Ultimate
Accident		Paid Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior			67,967		69,509		69,530		1.011		1.010		1.010		68,715		70,204		70,225		70,225
	1988		4,096		4,096		4,096		1.012		1.011		1.010		4,145		4,141		4,137		4,137
	1989		7,845		7,845		7,845		1.013		1.012		1.011		7,947		7,939		7,931		7,931
	1990		11,939		11,939		11,939		1.014		1.013		1.012		12,106		12,094		12,082		12,082
	1991		10,164		10,164		10,164		1.015		1.014		1.013		10,316		10,306		10,296		10,296
	1992		3,570		3,570		3,570		1.017		1.015		1.014		3,631		3,624		3,620		3,620
	1993		3,569		3,569		3,569		1.019		1.017		1.016		3,637		3,630		3,626		3,626
	1994		3,024		3,024		3,024		1.021		1.019		1.018		3,088		3,081		3,078		3,078
	1995		2,749		2,749		2,749		1.023		1.021		1.020		2,812		2,807		2,804		2,804
	1996		6,347		6,347		6,363		N/A		1.023		1.022		N/A		6,493		6,503		6,503
	1997		2,201		2,201		2,201		N/A		N/A		1.024		N/A		N/A		2,254		2,254

Milliman

WSC Assumed Business
Exhibit I3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Incurred Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		29,966		32,933		36,474		57,389		58,015		57,814		56,378		59,934		60,480		59,223		60,656		62,293		62,675		62,828		63,063		63,932		70,566		70,687		71,147		73,385		73,480		74,324		74,597		74,611
1988		244		855		2,984		2,859		3,316		3,468		4,128		4,468		4,033		4,073		4,071		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,096		4,096		4,096		4,096
1989		288		2,756		3,633		4,215		7,106		5,621		7,729		7,714		7,776		7,793		8,102		8,125		7,853		7,853		7,853		7,845		7,845		7,845		7,845		7,845		7,845		7,845
1990		3,703		7,576		8,235		10,204		13,758		12,242		11,865		11,819		11,916		11,918		11,809		11,929		11,940		11,940		11,940		11,940		11,940		11,940		11,940		11,940		11,940
1991		1,246		2,842		3,477		4,414		9,838		9,978		9,987		10,075		10,126		10,120		10,127		10,163		10,163		10,163		10,163		10,164		10,164		10,164		10,164		10,164
1992		585		1,790		2,392		2,655		2,989		3,020		3,175		3,193		3,474		3,474		3,474		3,472		3,482		3,482		3,483		3,570		3,570		3,570		3,570
1993		3,410		1,962		2,594		3,065		3,151		3,150		3,183		3,132		3,283		3,444		3,453		3,518		3,544		3,544		3,569		3,569		3,569		3,569
1994		457		1,624		2,392		2,534		2,635		3,132		3,040		2,993		3,000		3,014		3,023		3,023		3,024		3,024		3,024		3,024		3,024
1995		171		1,114		2,040		2,145		2,392		2,645		2,703		2,754		2,779		2,739		2,751		2,753		2,749		2,749		2,749		2,749
1996		656		4,526		4,637		4,965		5,402		5,497		5,664		6,287		6,344		6,347		6,347		6,347		6,522		6,347		6,363
1997		868		1,682		1,556		1,594		1,626		1,962		2,176		2,229		2,200		2,201		2,201		2,201		2,201		2,201
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*     Last Diagonal is as of 9/30/10.
Accident	Incurred Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.099		1.108		1.573		1.011		0.997		0.975		1.063		1.009		0.979		1.024		1.027		1.006		1.002		1.004		1.014		1.104		1.002		1.007		1.031		1.001		1.011		1.004		1.000
1988		3.504		3.490		0.958		1.160		1.046		1.190		1.082		0.903		1.010		1.000		1.006		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		9.569		1.318		1.160		1.686		0.791		1.375		0.998		1.008		1.002		1.040		1.003		0.967		1.000		1.000		0.999		1.000		1.000		1.000		1.000		1.000		1.000
1990		2.046		1.087		1.239		1.348		0.890		0.969		0.996		1.008		1.000		0.991		1.010		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		2.281		1.223		1.269		2.229		1.014		1.001		1.009		1.005		0.999		1.001		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		3.060		1.336		1.110		1.126		1.010		1.051		1.006		1.088		1.000		1.000		0.999		1.003		1.000		1.000		1.025		1.000		1.000		1.000
1993		0.575		1.322		1.182		1.028		1.000		1.010		0.984		1.048		1.049		1.003		1.019		1.007		1.000		1.007		1.000		1.000		1.000
1994		3.554		1.473		1.059		1.040		1.189		0.971		0.985		1.002		1.005		1.003		1.000		1.000		1.000		1.000		1.000		1.000
1995		6.515		1.831		1.051		1.115		1.106		1.022		1.019		1.009		0.986		1.004		1.001		0.999		1.000		1.000		1.000
1996		6.899		1.025		1.071		1.088		1.018		1.030		1.110		1.009		1.000		1.000		1.000		1.028		0.973		1.003
1997		1.938		0.925		1.024		1.020		1.207		1.109		1.024		0.987		1.000		1.000		1.000		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		3.731		1.467		1.154		1.259		1.024		1.064		1.025		1.007		1.003		1.006		1.006		1.001		0.998		1.001		1.004		1.013		1.000		1.001		1.006		1.000		1.004		1.002		1.000
Average x 87		3.994		1.503		1.112		1.284		1.027		1.073		1.021		1.007		1.005		1.004		1.004		1.000		0.997		1.001		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		3.433		1.303		1.130		1.179		1.030		1.040		1.020		1.010		1.000		1.004		1.005		1.002		1.000		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		4.002		1.273		1.061		1.052		1.104		1.021		1.009		1.007		1.002		1.002		1.000		1.003		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Average		1.434		1.180		1.364		1.148		0.985		1.014		1.042		1.007		0.991		1.015		1.016		1.003		1.000		1.002		1.009		1.061		1.001		1.004		1.021		1.001		1.010		1.003		1.000
WA x 1987		2.299		1.270		1.139		1.351		0.971		1.058		1.019		1.005		1.003		1.004		1.005		0.999		0.997		1.001		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		1.961		1.212		1.082		1.063		1.078		1.023		1.038		1.012		1.008		1.002		1.004		1.011		0.990		1.002		1.004		1.000		1.000		1.000		1.021
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.002		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.017		1.015		1.013		1.011		1.010		1.009		1.008		1.007		1.006		1.005		1.005
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141- Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.018		1.016		1.014		1.012		1.010		1.009		1.008		1.007		1.006		1.005		1.005

Milliman

WSC Assumed Business
Exhibit I4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

																			Indicated
							Cumulative												Ultimate
Accident	Incurred Losses ($000s)						Development Factors						Indicated Ultimate Losses ($000s)						Losses
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		74,324		74,597		74,611		1.006		1.005		1.005		74,770		74,970		74,984		74,984
1988		4,096		4,096		4,096		1.007		1.006		1.005		4,125		4,121		4,116		4,116
1989		7,845		7,845		7,845		1.008		1.007		1.006		7,908		7,900		7,892		7,892
1990		11,940		11,940		11,940		1.009		1.008		1.007		12,047		12,036		12,024		12,024
1991		10,164		10,164		10,164		1.010		1.009		1.008		10,266		10,255		10,245		10,245
1992		3,570		3,570		3,570		1.011		1.010		1.009		3,609		3,606		3,602		3,602
1993		3,569		3,569		3,569		1.013		1.011		1.010		3,615		3,608		3,605		3,605
1994		3,024		3,024		3,024		1.015		1.013		1.012		3,069		3,063		3,060		3,060
1995		2,749		2,749		2,749		1.017		1.015		1.014		2,796		2,790		2,787		2,787
1996		6,522		6,347		6,363		N/A		1.017		1.016		N/A		6,455		6,465		6,465
1997		2,201		2,201		2,201		N/A		N/A		1.018		N/A		N/A		2,241		2,241

Milliman

WSC Assumed Business
Exhibit I5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1987-1997 Ultimate Losses ($000s)

	Incurred		Indicated Ultimate Losses Based on				Selected
Accident	Losses		Paid Loss		Incurred Loss		Ultimate
Year	@9/30/10		Projection		Projection		Losses
1987&Prior		74,611		70,225		74,984		74,984
1988		4,096		4,137		4,116		4,116
1989		7,845		7,931		7,892		7,892
1990		11,940		12,082		12,024		12,024
1991		10,164		10,296		10,245		10,245
1992		3,570		3,620		3,602		3,602
1993		3,569		3,626		3,605		3,605
1994		3,024		3,078		3,060		3,060
1995		2,749		2,804		2,787		2,787
1996		6,363		6,503		6,465		6,465
1997		2,201		2,254		2,241		2,241
Total		130,132		126,556		131,021		131,021

Milliman

WSC Assumed Business
Exhibit I6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Losses
Year	Losses		Losses		Losses		Outstanding		@9/30/10		@9/30/10
1987&Prior		74,984		69,530		74,611		5,081		373		5,454
1988		4,116		4,096		4,096		0		20		20
1989		7,892		7,845		7,845		0		47		47
1990		12,024		11,939		11,940		1		84		85
1991		10,245		10,164		10,164		0		81		81
1992		3,602		3,570		3,570		0		32		32
1993		3,605		3,569		3,569		0		36		36
1994		3,060		3,024		3,024		0		36		36
1995		2,787		2,749		2,749		0		38		38
1996		6,465		6,363		6,363		0		102		102
1997		2,241		2,201		2,201		0		40		40
Total		131,021		125,050		130,132		5,082		889		5,971

Milliman

WSC Assumed Business
Exhibit I7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		3,093		3,467		3,651		7,011		7,255		7,374		7,104		7,528		8,004		8,184		8,271		8,314		8,338		8,371		8,389		8,404		8,452		8,498		8,523		8,527		8,548		8,564		8,557		8,565
1988		6		141		568		733		837		901		904		925		979		984		1,022		1,029		1,029		1,029		1,029		1,029		1,029		1,029		1,029		1,031		1,031		1,031		1,031
1989		41		409		687		904		1,081		1,186		1,219		1,264		1,289		1,301		1,316		1,329		1,330		1,333		1,333		1,350		1,352		1,353		1,353		1,353		1,353		1,353
1990		83		648		1,217		1,449		1,640		1,748		1,792		1,814		1,820		1,828		1,835		1,836		1,836		1,836		1,850		1,856		1,856		1,856		1,856		1,856		1,856
1991		60		360		555		642		723		824		860		883		914		933		959		970		978		981		984		984		987		991		991		991
1992		97		190		263		310		383		426		447		456		508		512		514		533		537		537		538		545		552		553		553
1993		220		317		403		462		496		507		526		548		562		582		595		604		611		614		617		617		617		617
1994		87		180		315		347		366		426		440		441		441		441		447		452		457		465		476		491		495
1995		0		28		72		132		170		196		238		256		263		266		276		287		288		294		295		300
1996		12		99		177		215		258		285		316		353		417		426		430		461		469		480		480
1997		14		64		124		179		193		225		240		250		251		253		253		255		255		255
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*     Last Diagonal is as of 9/30/10.
Accident	Paid ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.121		1.053		1.920		1.035		1.016		0.963		1.060		1.063		1.022		1.011		1.005		1.003		1.004		1.002		1.002		1.006		1.005		1.003		1.000		1.002		1.002		0.999		1.001
1988		23.500		4.028		1.290		1.142		1.076		1.003		1.023		1.058		1.005		1.039		1.007		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.002		1.000		1.000		1.000
1989		9.976		1.680		1.316		1.196		1.097		1.028		1.037		1.020		1.009		1.012		1.010		1.001		1.002		1.000		1.013		1.001		1.001		1.000		1.000		1.000		1.000
1990		7.807		1.878		1.191		1.132		1.066		1.025		1.012		1.003		1.004		1.004		1.001		1.000		1.000		1.008		1.003		1.000		1.000		1.000		1.000		1.000
1991		6.000		1.542		1.157		1.126		1.140		1.044		1.027		1.035		1.021		1.028		1.011		1.008		1.003		1.003		1.000		1.003		1.004		1.000		1.000
1992		1.959		1.384		1.179		1.235		1.112		1.049		1.020		1.114		1.008		1.004		1.037		1.008		1.000		1.002		1.013		1.013		1.002		1.000
1993		1.441		1.271		1.146		1.074		1.022		1.037		1.042		1.026		1.036		1.022		1.015		1.012		1.005		1.005		1.000		1.000		1.000
1994		2.069		1.750		1.102		1.055		1.164		1.033		1.002		1.000		1.000		1.014		1.011		1.011		1.018		1.024		1.032		1.011
1995		N/A		2.571		1.833		1.288		1.153		1.214		1.076		1.027		1.011		1.038		1.040		1.003		1.021		1.003		1.023
1996		8.250		1.788		1.215		1.200		1.105		1.109		1.117		1.181		1.022		1.009		1.072		1.017		1.023		1.000
1997		4.571		1.938		1.444		1.078		1.166		1.067		1.042		1.004		1.008		1.000		1.008		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		6.669		1.898		1.345		1.142		1.102		1.052		1.042		1.048		1.013		1.016		1.020		1.006		1.007		1.005		1.009		1.004		1.002		1.000		1.000		1.001		1.001		1.000		1.001
Average x 87		7.286		1.983		1.287		1.153		1.110		1.061		1.040		1.047		1.012		1.017		1.021		1.006		1.007		1.005		1.010		1.004		1.001		1.000		1.000		1.000		1.000		1.000
Average x H/L		5.259		1.756		1.308		1.138		1.104		1.044		1.038		1.039		1.012		1.016		1.016		1.005		1.006		1.003		1.008		1.004		1.001		1.000		1.000		1.000		1.000
Avg L5 x H/L		2.213		1.825		1.268		1.117		1.141		1.071		1.053		1.019		1.014		1.015		1.022		1.009		1.014		1.003		1.012		1.005		1.001		1.000		1.000
Wtd Average		1.590		1.361		1.542		1.082		1.052		0.999		1.045		1.050		1.017		1.013		1.010		1.004		1.004		1.003		1.004		1.004		1.004		1.002		1.000		1.002		1.001		0.999		1.001
WA x 1987		3.929		1.798		1.226		1.144		1.094		1.038		1.030		1.035		1.011		1.016		1.014		1.004		1.004		1.004		1.007		1.003		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		2.066		1.586		1.224		1.111		1.105		1.074		1.050		1.047		1.018		1.017		1.029		1.010		1.013		1.007		1.010		1.003		1.001		1.000		1.000
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.013		1.005		1.010		1.004		1.002		1.002		1.001		1.001		1.001		1.001		1.001
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.033		1.028		1.018		1.014		1.012		1.010		1.009		1.008		1.007		1.006		1.005
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141- Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.036		1.029		1.021		1.015		1.013		1.011		1.009		1.008		1.007		1.006		1.005

Milliman

WSC Assumed Business
Exhibit I8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Paid ALAE Projection

																			Indicated
							Cumulative												Ultimate
Accident	Paid ALAE ($000s)						Development Factors						Indicated Ultimate ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
1987&Prior		8,564		8,557		8,565		1.007		1.006		1.005		8,624		8,608		8,608		8,608
1988		1,031		1,031		1,031		1.008		1.007		1.006		1,039		1,038		1,037		1,037
1989		1,353		1,353		1,353		1.009		1.008		1.007		1,365		1,364		1,362		1,362
1990		1,856		1,856		1,856		1.010		1.009		1.008		1,875		1,873		1,871		1,871
1991		991		991		991		1.012		1.010		1.009		1,003		1,001		1,000		1,000
1992		552		553		553		1.014		1.012		1.011		560		560		559		559
1993		617		617		617		1.018		1.014		1.013		628		626		625		625
1994		476		491		495		1.028		1.018		1.015		489		500		502		502
1995		294		295		300		1.033		1.028		1.021		304		303		306		306
1996		469		480		480		N/A		1.033		1.029		N/A		496		494		494
1997		255		255		255		N/A		N/A		1.036		N/A		N/A		264		264

Milliman

WSC Assumed Business
Exhibit I9

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE/Paid Loss* + 1
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		1.112		1.113		1.118		1.137		1.139		1.139		1.131		1.132		1.139		1.141		1.140		1.140		1.137		1.137		1.136		1.134		1.132		1.129		1.126		1.127		1.125		1.126		1.123		1.123
1988		1.122		1.257		1.269		1.283		1.263		1.267		1.254		1.259		1.244		1.243		1.252		1.251		1.251		1.251		1.251		1.251		1.251		1.251		1.251		1.252		1.252		1.252		1.252
1989		1.279		1.175		1.203		1.231		1.193		1.163		1.163		1.166		1.167		1.167		1.169		1.170		1.170		1.170		1.170		1.172		1.172		1.172		1.172		1.172		1.172		1.172
1990		1.027		1.110		1.176		1.189		1.131		1.153		1.153		1.154		1.154		1.155		1.155		1.154		1.154		1.154		1.155		1.155		1.155		1.155		1.155		1.155		1.155
1991		1.105		1.148		1.172		1.149		1.073		1.083		1.087		1.088		1.090		1.092		1.095		1.095		1.096		1.097		1.097		1.097		1.097		1.098		1.098		1.098
1992		1.353		1.120		1.126		1.126		1.140		1.146		1.147		1.148		1.146		1.148		1.148		1.154		1.154		1.154		1.154		1.153		1.155		1.155		1.155
1993		1.066		1.199		1.176		1.156		1.163		1.163		1.169		1.175		1.172		1.173		1.176		1.177		1.176		1.173		1.173		1.173		1.173		1.173
1994		1.524		1.212		1.174		1.140		1.143		1.152		1.148		1.147		1.147		1.146		1.148		1.150		1.151		1.154		1.157		1.162		1.164
1995		1.000		1.030		1.042		1.068		1.079		1.080		1.091		1.094		1.096		1.097		1.101		1.104		1.105		1.107		1.107		1.109
1996		1.020		1.033		1.040		1.044		1.048		1.053		1.056		1.056		1.066		1.067		1.068		1.073		1.074		1.076		1.075
1997		1.039		1.081		1.133		1.123		1.128		1.122		1.111		1.114		1.114		1.115		1.115		1.116		1.116		1.116
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A		N/A
2008		N/A		N/A		N/A
2009		N/A		N/A
2010		N/A
*     Last Diagonal is as of 9/30/10.
Accident	Paid ALAE/Paid Loss + 1 Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.001		1.004		1.018		1.002		1.000		0.994		1.001		1.006		1.002		0.999		1.000		0.998		1.000		0.999		0.999		0.998		0.998		0.997		1.001		0.998		1.001		0.997		1.000
1988		1.120		1.010		1.011		0.984		1.003		0.990		1.004		0.989		0.999		1.007		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		0.918		1.024		1.023		0.969		0.975		1.000		1.002		1.001		1.000		1.002		1.001		1.000		1.000		1.000		1.002		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.081		1.059		1.011		0.951		1.019		1.000		1.001		1.000		1.001		1.000		0.999		1.000		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.039		1.020		0.980		0.935		1.009		1.003		1.001		1.002		1.002		1.002		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		0.828		1.005		1.000		1.013		1.005		1.001		1.001		0.999		1.001		1.001		1.005		1.001		1.000		1.000		0.998		1.002		1.000		1.000
1993		1.125		0.981		0.983		1.005		1.000		1.005		1.006		0.997		1.001		1.003		1.001		0.999		0.998		1.000		1.000		1.000		1.000
1994		0.795		0.969		0.971		1.002		1.008		0.997		0.999		1.000		0.999		1.001		1.001		1.001		1.002		1.003		1.004		1.002
1995		1.030		1.012		1.025		1.010		1.001		1.010		1.003		1.002		1.001		1.003		1.003		1.000		1.002		1.000		1.002
1996		1.013		1.007		1.004		1.004		1.004		1.003		1.000		1.009		1.001		1.001		1.005		1.001		1.002		1.000
1997		1.040		1.048		0.992		1.004		0.995		0.990		1.003		1.000		1.001		1.000		1.001		1.000		1.000
1998		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1999		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2000		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2001		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2002		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2003		N/A		N/A		N/A		N/A		N/A		N/A		N/A
2004		N/A		N/A		N/A		N/A		N/A		N/A
2005		N/A		N/A		N/A		N/A		N/A
2006		N/A		N/A		N/A		N/A
2007		N/A		N/A		N/A
2008		N/A		N/A
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		0.999		1.013		1.002		0.989		1.002		0.999		1.002		1.000		1.001		1.002		1.001		1.000		1.000		1.000		1.001		1.000		1.000		1.000		1.000		0.999		1.000		0.999		1.000
Average x 87		0.999		1.014		1.000		0.988		1.002		1.000		1.002		1.000		1.001		1.002		1.002		1.000		1.000		1.000		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		1.008		1.012		1.002		0.992		1.003		0.999		1.002		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		1.028		1.000		0.993		1.004		1.002		1.002		1.002		1.001		1.001		1.002		1.002		1.001		1.001		1.000		1.001		1.001		1.000		1.000		1.000
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit I10

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	(1)		(2)		(3)
					[(1)x(2)]
	Paid ALAE/		Cumulative Ratio		Projected
	Paid Loss + 1		Development		Ultimate
Accident	Ratio		Factors for		Ratio
Year	@9/30/10		9/10-Ult		@9/30/10
1987&Prior		1.123		1.000		1.123
1988		1.252		1.000		1.252
1989		1.172		1.000		1.172
1990		1.155		1.000		1.155
1991		1.098		1.000		1.098
1992		1.155		1.000		1.155
1993		1.173		1.000		1.173
1994		1.164		1.000		1.164
1995		1.109		1.000		1.109
1996		1.075		1.000		1.075
1997		1.116		1.000		1.116

Milliman

WSC Assumed Business
Exhibit I11

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

					Selected						Selected		Ultimate
			Paid ALAE		Ultimate		Paid to Paid		Paid ALAE		Ultimate		ALAE to
Accident	Paid		To Paid		Losses		Projection		Projection		ALAE		Ultimate
Year	ALAE		Loss Ratio		($000s)		($000s)		($000s)		($000s)		Loss Ratio
1987&Prior		8,565		0.123		74,984		9,223		8,608		8,608		0.1148
1988		1,031		0.252		4,116		1,037		1,037		1,037		0.2519
1989		1,353		0.172		7,892		1,357		1,362		1,360		0.1723
1990		1,856		0.155		12,024		1,864		1,871		1,868		0.1554
1991		991		0.098		10,245		1,004		1,000		1,002		0.0978
1992		553		0.155		3,602		558		559		559		0.1552
1993		617		0.173		3,605		624		625		625		0.1734
1994		495		0.164		3,060		502		502		502		0.1641
1995		300		0.109		2,787		304		306		305		0.1094
1996		480		0.075		6,465		485		494		490		0.0758
1997		255		0.116		2,241		260		264		262		0.1169
Total		16,496				131,021		17,218		16,628		16,618		0.1268

Milliman

WSC Assumed Business
Exhibit I12

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Paid		Ultimate		Unpaid
Accident	ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1987&Prior		8,565		8,608		43
1988		1,031		1,037		6
1989		1,353		1,360		7
1990		1,856		1,868		12
1991		991		1,002		11
1992		553		559		6
1993		617		625		8
1994		495		502		7
1995		300		305		5
1996		480		490		10
1997		255		262		7
Total		16,496		16,618		122

Milliman

WSC Assumed Business
Exhibit I13

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1987&Prior		83,592		78,095		83,176		5,081		416		5,497
1988		5,153		5,127		5,127		0		26		26
1989		9,252		9,198		9,198		0		54		54
1990		13,892		13,795		13,796		1		96		97
1991		11,247		11,155		11,155		0		92		92
1992		4,161		4,123		4,123		0		38		38
1993		4,230		4,186		4,186		0		44		44
1994		3,562		3,519		3,519		0		43		43
1995		3,092		3,049		3,049		0		43		43
1996		6,955		6,843		6,843		0		112		112
1997		2,503		2,456		2,456		0		47		47
Total		147,639		141,546		146,628		5,082		1,011		6,093

Milliman

WSC Assumed Business
Exhibit J1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Accident	Loss Salvage & Subrogation Recovered* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		5,670		5,550		5,696		10,363		11,061		11,162		11,611		11,846		12,301		12,347		12,384		12,724		12,785		13,148		13,138		13,150		13,425		13,579		13,786		13,738		13,789		13,757		13,735		14,713
1988		17		50		253		355		425		472		517		567		610		611		647		648		649		651		652		652		652		653		670		670		670		670		670
1989		20		154		257		501		679		673		785		2,223		2,255		2,270		2,281		2,297		2,302		2,305		2,307		2,306		2,315		2,315		2,316		2,317		2,317		2,317
1990		101		59		107		902		1,053		1,149		1,458		1,807		2,051		2,083		2,104		2,107		2,107		2,107		2,115		2,115		2,115		2,115		2,115		2,115		2,130
1991		49		264		296		360		630		768		863		967		989		1,090		1,100		1,103		1,104		1,114		1,114		1,116		1,116		1,116		1,116		1,116
1992		97		391		469		527		573		623		657		664		670		647		647		642		642		642		642		642		642		647		652
1993		3,067		485		653		931		963		1,025		1,113		1,114		1,112		1,113		1,113		1,113		1,113		1,146		1,146		1,146		1,146		1,146
1994		1		211		338		504		521		538		474		482		649		650		651		652		653		654		654		656		656
1995		2		166		200		255		283		370		476		502		514		549		550		550		550		550		551		551
1996		56		1,985		2,060		2,097		2,359		2,426		2,492		2,517		2,523		2,593		2,603		2,612		2,622		2,810		2,818
1997		43		65		92		124		139		179		171		231		230		266		300		301		302		303
1998		0		0		0		0		0		0		0		0		0		0		0		0		0
1999		0		0		0		0		0		0		0		0		0		0		0		0
2000		0		0		0		0		0		0		0		0		0		0		0
2001		0		0		0		0		0		0		0		0		0		0
2002		0		0		0		0		0		0		0		0		0
2003		0		0		0		0		0		0		0		0
2004		0		0		0		0		0		0		0
2005		0		0		0		0		0		0
2006		0		0		0		0		0
2007		0		0		0		0
2008		0		0		0
2009		0		0
2010		0
*     Last Diagonal is as of 9/30/10.
Accident	Salvage & Subrogation Recovered Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		0.979		1.026		1.819		1.067		1.009		1.040		1.020		1.038		1.004		1.003		1.027		1.005		1.028		0.999		1.001		1.021		1.011		1.015		0.997		1.004		0.998		0.998		1.096
1988		2.941		5.060		1.403		1.197		1.111		1.095		1.097		1.076		1.002		1.059		1.002		1.002		1.003		1.002		1.000		1.000		1.002		1.026		1.000		1.000		1.000		1.000
1989		7.700		1.669		1.949		1.355		0.991		1.166		2.832		1.014		1.007		1.005		1.007		1.002		1.001		1.001		1.000		1.004		1.000		1.000		1.000		1.000		1.000
1990		0.584		1.814		8.430		1.167		1.091		1.269		1.239		1.135		1.016		1.010		1.001		1.000		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.009
1991		5.388		1.121		1.216		1.750		1.219		1.124		1.121		1.023		1.102		1.009		1.003		1.001		1.009		1.000		1.002		1.000		1.000		1.000		1.000
1992		4.031		1.199		1.124		1.087		1.087		1.055		1.011		1.009		0.966		1.000		0.992		1.000		1.000		1.000		1.000		1.000		1.008		1.010
1993		0.158		1.346		1.426		1.034		1.064		1.086		1.001		0.998		1.001		1.000		1.000		1.000		1.030		1.000		1.000		1.000		1.000
1994		211.000		1.602		1.491		1.034		1.033		0.881		1.017		1.346		1.002		1.002		1.002		1.002		1.002		1.000		1.003		1.000
1995		83.000		1.205		1.275		1.110		1.307		1.286		1.055		1.024		1.068		1.002		1.000		1.000		1.000		1.002		1.000
1996		35.446		1.038		1.018		1.125		1.028		1.027		1.010		1.002		1.028		1.004		1.003		1.004		1.072		1.004
1997		1.512		1.415		1.348		1.121		1.288		0.955		1.351		0.996		1.157		1.128		1.003		1.003		1.004
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		32.067		1.681		2.045		1.186		1.112		1.090		1.250		1.060		1.032		1.020		1.004		1.002		1.014		1.001		1.001		1.003		1.003		1.009		0.999		1.003		0.999		0.999		1.096
Average x 87		35.176		1.747		2.068		1.198		1.122		1.094		1.273		1.062		1.035		1.022		1.001		1.001		1.012		1.001		1.001		1.001		1.002		1.007		1.000		1.003		1.000		1.000
Average x H/L		15.731		1.379		1.450		1.141		1.103		1.091		1.102		1.036		1.025		1.010		1.002		1.001		1.009		1.001		1.000		1.001		1.002		1.006		1.000		1.002		1.000
Average L5		66.223		1.321		1.312		1.085		1.144		1.047		1.087		1.073		1.051		1.027		1.002		1.002		1.021		1.001		1.001		1.000		1.002		1.007		0.999
Wtd Average		1.028		1.111		1.624		1.104		1.037		1.064		1.112		1.043		1.013		1.007		1.015		1.003		1.024		1.001		1.001		1.013		1.007		1.011		0.998		1.004		0.998		0.998		1.096
Wtd Average x 87		1.109		1.234		1.388		1.163		1.078		1.095		1.230		1.048		1.023		1.010		1.002		1.002		1.020		1.002		1.000		1.001		1.001		1.004		1.000		1.004		1.000		1.000
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.010		1.002		1.001		1.001		1.002		1.002		1.001		1.001		1.001		1.001		1.001
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.014		1.012		1.011		1.010		1.008		1.006		1.005		1.004		1.003		1.002		1.001
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.017		1.013		1.011		1.010		1.009		1.007		1.005		1.004		1.003		1.002		1.001

Milliman

WSC Assumed Business
Exhibit J2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Loss Salvage & Subrogation Recovered Development Projection Method ($000s)

	(1)		(2)		(3)
					(1) x (2)
					Projected
					Ultimate
			Cumulative		Loss
	Salvage		Development		Salvage
Accident	Recovered		Factors		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10
1987 & Prior		14,713		1.001		14,728
1988		670		1.002		671
1989		2,317		1.003		2,324
1990		2,130		1.004		2,139
1991		1,116		1.005		1,122
1992		652		1.007		657
1993		1,146		1.009		1,156
1994		656		1.010		663
1995		551		1.011		557
1996		2,818		1.013		2,855
1997		303		1.017		308
Total		27,072				27,180

Milliman

WSC Assumed Business
Exhibit J3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		27,636		30,800		31,065		51,105		52,189		53,165		54,100		56,856		57,633		57,933		58,987		59,517		60,926		61,278		61,798		62,693		64,189		65,811		67,488		66,911		68,371		67,967		69,509		69,530
1988		49		548		2,109		2,591		3,185		3,374		3,561		3,574		4,006		4,050		4,061		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,095		4,096		4,096		4,096
1989		147		2,343		3,387		3,921		5,605		7,275		7,458		7,599		7,719		7,791		7,794		7,818		7,845		7,845		7,845		7,845		7,845		7,845		7,845		7,845		7,845		7,845
1990		3,044		5,874		6,903		7,676		12,526		11,432		11,719		11,749		11,805		11,805		11,809		11,928		11,939		11,939		11,939		11,939		11,939		11,939		11,939		11,939		11,939
1991		569		2,430		3,233		4,321		9,854		9,892		9,911		10,000		10,120		10,120		10,127		10,163		10,163		10,163		10,163		10,164		10,164		10,164		10,164		10,164
1992		275		1,585		2,095		2,462		2,728		2,922		3,051		3,080		3,471		3,471		3,471		3,472		3,482		3,482		3,483		3,570		3,570		3,570		3,570
1993		3,336		1,595		2,288		2,955		3,050		3,114		3,119		3,127		3,263		3,360		3,376		3,415		3,480		3,544		3,569		3,569		3,569		3,569
1994		166		848		1,809		2,474		2,560		2,810		2,970		2,993		3,000		3,014		3,023		3,023		3,024		3,024		3,024		3,024		3,024
1995		34		935		1,697		1,929		2,151		2,436		2,615		2,712		2,729		2,733		2,735		2,749		2,749		2,749		2,749		2,749
1996		606		2,996		4,377		4,841		5,334		5,424		5,663		6,287		6,344		6,347		6,347		6,347		6,347		6,347		6,363
1997		357		790		935		1,450		1,513		1,846		2,165		2,197		2,197		2,201		2,201		2,201		2,201		2,201
1998		0		0		0		0		0		0		0		0		0		0		0		0		0
1999		0		0		0		0		0		0		0		0		0		0		0		0
2000		0		0		0		0		0		0		0		0		0		0		0
2001		0		0		0		0		0		0		0		0		0		0
2002		0		0		0		0		0		0		0		0		0
2003		0		0		0		0		0		0		0		0
2004		0		0		0		0		0		0		0
2005		0		0		0		0		0		0
2006		0		0		0		0		0
2007		0		0		0		0
2008		0		0		0
2009		0		0
2010		0

* Last Diagonal is as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit J4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Accident	Ratio of Loss Salvage & Subrogation Recovered to Paid Losses*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987 & Prior		0.205		0.180		0.183		0.203		0.212		0.210		0.215		0.208		0.213		0.213		0.210		0.214		0.210		0.215		0.213		0.210		0.209		0.206		0.204		0.205		0.202		0.202		0.198		0.212
1988		0.347		0.091		0.120		0.137		0.133		0.140		0.145		0.159		0.152		0.151		0.159		0.158		0.158		0.159		0.159		0.159		0.159		0.159		0.164		0.164		0.164		0.164		0.164
1989		0.136		0.066		0.076		0.128		0.121		0.093		0.105		0.293		0.292		0.291		0.293		0.294		0.293		0.294		0.294		0.294		0.295		0.295		0.295		0.295		0.295		0.295
1990		0.033		0.010		0.016		0.118		0.084		0.101		0.124		0.154		0.174		0.176		0.178		0.177		0.176		0.176		0.177		0.177		0.177		0.177		0.177		0.177		0.178
1991		0.086		0.109		0.092		0.083		0.064		0.078		0.087		0.097		0.098		0.108		0.109		0.109		0.109		0.110		0.110		0.110		0.110		0.110		0.110		0.110
1992		0.353		0.247		0.224		0.214		0.210		0.213		0.215		0.216		0.193		0.186		0.186		0.185		0.184		0.184		0.184		0.180		0.180		0.181		0.183
1993		0.919		0.304		0.285		0.315		0.316		0.329		0.357		0.356		0.341		0.331		0.330		0.326		0.320		0.323		0.321		0.321		0.321		0.321
1994		0.006		0.249		0.187		0.204		0.204		0.191		0.160		0.161		0.216		0.216		0.215		0.216		0.216		0.216		0.216		0.217		0.217
1995		0.059		0.178		0.118		0.132		0.132		0.152		0.182		0.185		0.188		0.201		0.201		0.200		0.200		0.200		0.200		0.200
1996		0.092		0.663		0.471		0.433		0.442		0.447		0.440		0.400		0.398		0.409		0.410		0.412		0.413		0.443		0.443
1997		0.120		0.082		0.098		0.086		0.092		0.097		0.079		0.105		0.105		0.121		0.136		0.137		0.137		0.138
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
*     Last Diagonal is as of 9/30/10.
Accident	Loss Salvage & Subrogation Recovered to Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987 & Prior		0.878		1.018		1.106		1.045		0.991		1.022		0.971		1.024		0.999		0.985		1.018		0.982		1.022		0.991		0.987		0.997		0.987		0.990		1.005		0.982		1.004		0.976		1.096
1988		0.263		1.315		1.142		0.974		1.048		1.038		1.093		0.960		0.991		1.056		0.993		1.002		1.003		1.002		1.000		1.000		1.002		1.026		1.000		1.000		1.000		1.000
1989		0.483		1.154		1.684		0.948		0.764		1.138		2.779		0.999		0.997		1.004		1.004		0.999		1.001		1.001		1.000		1.004		1.000		1.000		1.000		1.000		1.000
1990		0.303		1.543		7.581		0.715		1.196		1.238		1.236		1.130		1.016		1.010		0.991		0.999		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.009
1991		1.262		0.843		0.910		0.767		1.214		1.122		1.111		1.011		1.102		1.008		0.999		1.001		1.009		1.000		1.002		1.000		1.000		1.000		1.000
1992		0.699		0.907		0.956		0.981		1.015		1.010		1.001		0.895		0.966		1.000		0.992		0.997		1.000		1.000		0.976		1.000		1.008		1.010
1993		0.331		0.939		1.104		1.002		1.043		1.084		0.998		0.957		0.972		0.995		0.989		0.981		1.011		0.993		1.000		1.000		1.000
1994		41.304		0.751		1.090		0.999		0.941		0.834		1.009		1.343		0.997		0.999		1.002		1.001		1.002		1.000		1.003		1.000
1995		3.018		0.664		1.122		0.995		1.154		1.198		1.017		1.018		1.067		1.001		0.995		1.000		1.000		1.002		1.000
1996		7.170		0.710		0.920		1.021		1.011		0.984		0.910		0.993		1.027		1.004		1.003		1.004		1.072		1.000
1997		0.683		1.196		0.869		1.074		1.055		0.815		1.331		0.996		1.154		1.128		1.003		1.003		1.004
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		5.127		1.004		1.680		0.957		1.039		1.044		1.223		1.030		1.026		1.017		0.999		0.997		1.011		0.999		0.996		1.000		0.999		1.004		1.001		0.998		1.001		0.988		1.096
Average x 87		5.552		1.002		1.738		0.948		1.044		1.046		1.249		1.030		1.029		1.021		0.997		0.999		1.010		1.000		0.997		1.001		1.002		1.007		1.000		1.003		1.000		1.000
Average x H/L		1.647		0.981		1.115		0.970		1.050		1.048		1.085		1.010		1.019		1.009		0.998		0.998		1.006		1.000		0.998		1.000		1.000		1.003		1.000		1.000		1.000
Avg L5 x H/L		2.893		0.800		1.038		1.007		1.036		0.967		1.008		1.002		1.030		1.001		1.000		1.002		1.006		1.000		1.001		1.000		1.000		1.004		1.000
Selected		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.005		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.003		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit J5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Loss Salvage & Subrogation Recovered to Paid Losses ($000s)

									(5)
									(3) x (4)
			(2)		(3)				Projected
			Cumulative		(1) x (2)		(4)		Ultimate
			Ratio		Projected		Net		Loss
	(1)		Development		Ultimate		Ultimate		Salvage
Accident	Ratio		Factors		Ratio		Losses		Recovered
Year	@9/30/10		9/30/10-Ult		@9/30/10		@9/30/10		@9/30/10
1987 & Prior		0.212		1.000		0.212		74,984		15,897
1988		0.164		1.000		0.164		4,116		675
1989		0.295		1.000		0.295		7,892		2,328
1990		0.178		1.000		0.178		12,024		2,140
1991		0.110		1.000		0.110		10,245		1,127
1992		0.183		1.000		0.183		3,602		659
1993		0.321		1.000		0.321		3,605		1,157
1994		0.217		1.000		0.217		3,060		664
1995		0.200		1.000		0.200		2,787		557
1996		0.443		1.001		0.443		6,465		2,864
1997		0.138		1.003		0.138		2,241		309
Total								131,021		28,377

Milliman

WSC Assumed Business
Exhibit J6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Selection of Ultimate Loss Salvage & Subrogation ($000s)

			Ultimate		Ultimate
			Salvage		Salvage				Selected
	Net		Indicated by		Indicated by				Ultimate
	Ultimate		Dollar		Ratio		Selected		Salvage
Accident	Losses		Development		Development		Ultimate		to Ultimate
Year	@9/30/10		Method		Method		Salvage		Loss Ratio
1987 & Prior		74,984		14,728		15,897		14,728		0.196
1988		4,116		671		675		672		0.163
1989		7,892		2,324		2,328		2,326		0.295
1990		12,024		2,139		2,140		2,140		0.178
1991		10,245		1,122		1,127		1,125		0.110
1992		3,602		657		659		658		0.183
1993		3,605		1,156		1,157		1,156		0.321
1994		3,060		663		664		664		0.217
1995		2,787		557		557		557		0.200
1996		6,465		2,855		2,864		2,860		0.442
1997*		2,241		308		309		309		0.138
Total		131,021		27,180		28,377		27,195		0.208

* 1997 Year is from 1/1/97-9/30/97

Milliman

WSC Assumed Business
Exhibit J7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss Salvage & Subrogation ($000s)

	Selected		Salvage		Indicated
Accident	Ultimate		Recovered		Salvage
Year	Salvage		@9/30/10		Recoverable
1987 & Prior		14,728		14,713		15
1988		672		670		2
1989		2,326		2,317		9
1990		2,140		2,130		10
1991		1,125		1,116		9
1992		658		652		6
1993		1,156		1,146		10
1994		664		656		8
1995		557		551		6
1996		2,860		2,818		42
1997*		309		303		6
Total		27,195		27,072		123

* 1997 Year is from 1/1/97-9/30/97

Milliman

WSC Assumed Business
Exhibit K1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Loss & ALAE* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		49,265		52,620		57,932		149,313		149,813		150,245		149,037		149,749		149,706		149,544		149,431		149,315		149,219		149,087		149,087		149,164		149,489		149,956		150,360		150,055		150,249		150,129		150,248		150,322
1988		0		523		13,340		14,575		14,638		14,828		15,033		15,331		15,385		15,338		15,334		15,475		15,524		15,520		15,517		15,513		15,509		15,508		15,508		15,508		15,508		15,508		15,508
1989		530		13,104		13,974		15,255		17,081		17,607		17,739		18,201		18,098		17,956		18,719		19,277		19,136		19,136		19,135		19,134		19,132		19,131		18,672		18,671		18,770		18,994
1990		3,506		10,521		17,740		21,144		22,762		22,982		23,026		23,371		23,767		23,071		23,118		23,071		23,121		23,084		23,128		22,910		22,925		22,925		22,926		22,926		22,926
1991		4,836		21,236		31,070		32,852		34,375		35,775		36,048		35,681		35,901		36,610		36,652		36,702		36,592		36,606		36,471		36,416		36,400		36,394		36,377		36,374
1992		7,352		18,039		35,124		36,466		41,607		33,772		36,042		34,933		35,190		34,683		34,583		34,587		34,823		34,208		34,393		34,393		34,393		34,393		34,393
1993		2,789		34,277		37,746		42,700		35,464		39,478		37,416		37,761		37,701		37,344		38,389		38,394		38,402		37,945		37,735		37,755		37,755		37,815
1994		728		17,831		27,909		33,441		34,484		35,340		40,547		40,418		41,189		40,032		40,059		40,059		40,517		40,517		40,563		40,563		40,563
1995		942		11,598		15,144		10,696		9,454		9,720		9,764		9,989		10,056		9,723		9,501		9,518		9,519		9,521		9,517		9,517
1996		5,585		9,594		11,248		11,493		11,574		12,095		11,800		11,887		11,895		11,880		11,901		11,207		11,060		11,059		11,088
1997		N/A		N/A		N/A		N/A		10,589		10,378		9,998		10,049		10,070		9,647		9,702		9,737		9,922		10,038
1998		N/A		N/A		N/A		13,952		14,416		14,180		13,862		13,386		13,436		13,437		13,428		13,466		13,466
1999		N/A		N/A		17,090		19,056		21,275		23,590		23,871		23,790		23,903		24,148		23,986		23,636
2000		N/A		27,924		40,571		41,072		42,420		43,293		45,959		46,400		45,715		45,496		45,387
2001		10,837		30,680		33,931		35,622		41,096		44,492		45,202		45,980		46,408		48,643
2002		3,760		13,626		26,031		27,863		29,904		38,381		37,903		38,061		38,258
2003		6,757		31,427		48,364		49,581		50,489		48,236		49,036		50,942
2004		125		2,694		4,443		9,562		13,519		12,915		12,924
2005		0		869		1,838		1,798		1,908		2,097
2006		38		603		1,298		763		1,127
2007		0		888		327		435
2008		50		456		688
2009		2,963		2,570
2010		161

* Excludes Dick Corporation in 2005. Last Diagonal is as of 9/30/10.

Accident	Paid Loss & ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.068		1.101		2.577		1.003		1.003		0.992		1.005		1.000		0.999		0.999		0.999		0.999		0.999		1.000		1.001		1.002		1.003		1.003		0.998		1.001		0.999		1.001		1.001
1988		N/A		25.507		1.093		1.004		1.013		1.014		1.020		1.004		0.997		1.000		1.009		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		24.725		1.066		1.092		1.120		1.031		1.007		1.026		0.994		0.992		1.042		1.030		0.993		1.000		1.000		1.000		1.000		1.000		0.976		1.000		1.005		1.016
1990		3.001		1.686		1.192		1.077		1.010		1.002		1.015		1.017		0.971		1.002		0.998		1.002		0.998		1.002		0.991		1.001		1.000		1.000		1.000		1.000
1991		4.391		1.463		1.057		1.046		1.041		1.008		0.990		1.006		1.020		1.001		1.001		0.997		1.000		0.996		0.998		1.000		1.000		1.000		1.000
1992		2.454		1.947		1.038		1.141		0.812		1.067		0.969		1.007		0.986		0.997		1.000		1.007		0.982		1.005		1.000		1.000		1.000		1.000
1993		12.290		1.101		1.131		0.831		1.113		0.948		1.009		0.998		0.991		1.028		1.000		1.000		0.988		0.994		1.001		1.000		1.002
1994		24.493		1.565		1.198		1.031		1.025		1.147		0.997		1.019		0.972		1.001		1.000		1.011		1.000		1.001		1.000		1.000
1995		12.312		1.306		0.706		0.884		1.028		1.005		1.023		1.007		0.967		0.977		1.002		1.000		1.000		1.000		1.000
1996		1.718		1.172		1.022		1.007		1.045		0.976		1.007		1.001		0.999		1.002		0.942		0.987		1.000		1.003
1997		N/A		N/A		N/A		N/A		0.980		0.963		1.005		1.002		0.958		1.006		1.004		1.019		1.016
1998		N/A		N/A		N/A		1.033		0.984		0.978		0.966		1.004		1.000		0.999		1.003		1.000
1999		N/A		N/A		1.115		1.116		1.109		1.012		0.997		1.005		1.010		0.993		0.981
2000		N/A		1.453		1.012		1.033		1.021		1.062		1.010		0.985		0.995		0.997
2001		2.831		1.106		1.050		1.154		1.083		1.016		1.017		1.009		1.065
2002		3.624		1.910		1.070		1.073		1.283		0.988		1.004		1.007
2003		4.651		1.539		1.025		1.018		0.955		1.017		1.052
2004		21.552		1.649		2.152		1.414		0.955		1.001
2005		N/A		2.115		0.978		1.061		1.134
2006		15.868		2.153		0.588		1.682
2007		N/A		0.368		1.463
2008		9.120		1.730
2009		0.827
**       Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		9.058		2.734		1.187		1.091		1.033		1.011		1.007		1.004		0.995		1.003		0.998		1.002		0.999		1.000		0.999		1.000		1.001		0.996		1.000		1.002		1.005		1.000		1.001
Average x 87		9.590		2.824		1.110		1.096		1.035		1.012		1.007		1.004		0.994		1.003		0.997		1.002		0.998		1.000		0.999		1.000		1.000		0.995		1.000		1.002		1.008		1.000
Average x H/L		8.527		1.533		1.141		1.072		1.031		1.007		1.006		1.004		0.992		1.002		1.000		1.001		0.998		1.000		1.000		1.000		1.000		1.000		1.000		1.001		1.000
Avg L5 x H/L		N/A		1.832		1.155		1.183		1.057		1.011		1.010		1.005		1.002		0.999		0.995		1.004		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Average		2.729		1.403		1.273		1.036		1.021		1.013		1.007		1.003		1.000		1.003		0.999		1.001		0.997		1.000		1.000		1.001		1.002		1.000		0.999		1.001		1.001		1.001		1.001
WA x 1987		4.339		1.468		1.072		1.048		1.027		1.020		1.008		1.004		1.000		1.004		0.999		1.002		0.996		1.000		0.999		1.000		1.000		0.996		1.000		1.002		1.009		1.000
Wtd Avg L5		1.726		1.578		1.105		1.084		1.068		1.020		1.019		1.001		1.019		0.998		0.984		1.006		0.997		1.000		1.000		1.000		1.000		0.996		0.999
Selected		4.339		1.832		1.273		1.183		1.068		1.020		1.010		1.004		1.005		1.004		1.003		1.002		1.001		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		13.481		3.107		1.696		1.332		1.126		1.054		1.033		1.023		1.019		1.014		1.010		1.007		1.005		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		23.254		4.484		1.973		1.415		1.174		1.071		1.038		1.026		1.020		1.015		1.011		1.008		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit K2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss & ALAE Projection*

																			Indicated
																			Ultimate
							Cumulative						Indicated Ultimate						Loss &
Accident	Paid Loss & ALAE ($000s)						Development Factors						Loss & ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
10/97-12/97		1,567		1,793		1,927		1.007		1.005		1.004		1,578		1,802		1,935		1,935
1998		13,428		13,466		13,466		1.010		1.007		1.006		13,562		13,560		13,547		13,547
1999		24,148		23,986		23,636		1.014		1.010		1.008		24,486		24,226		23,825		23,825
2000		45,715		45,496		45,387		1.019		1.014		1.011		46,584		46,133		45,886		45,886
2001		45,980		46,408		48,643		1.023		1.019		1.015		47,038		47,290		49,373		49,373
2002		37,903		38,061		38,258		1.033		1.023		1.020		39,154		38,936		39,023		39,023
2003		48,236		49,036		50,942		1.054		1.033		1.026		50,841		50,654		52,266		52,266
2004		13,519		12,915		12,924		1.126		1.054		1.038		15,222		13,612		13,415		13,415
2005		1,798		1,908		2,097		1.332		1.126		1.071		2,395		2,148		2,246		2,246
2006		1,298		763		1,127		1.696		1.332		1.174		2,201		1,016		1,323		1,323
2007		888		327		435		3.107		1.696		1.415		2,759		555		616		616
2008		50		456		688		13.481		3.107		1.973		674		1,417		1,357		1,357
2009				2,963		2,570				13.481		4.484				39,944		11,524		11,524
2010						161						23.254						3,744		2,808

* Excludes Dick Corporation in 2005.

Note: The 9-Ult Cumulative Loss & ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss & ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit K3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Incurred Loss & ALAE* ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior		55,459		58,165		62,423		154,641		152,925		150,729		149,344		150,604		150,178		149,626		149,547		149,486		149,365		149,087		149,087		149,164		150,249		150,248		150,740		150,625		150,625		150,657		151,402		151,482
1988		0		698		14,117		15,013		14,980		14,982		15,130		15,498		15,510		15,338		15,334		15,475		15,524		15,520		15,517		15,513		15,509		15,508		15,508		15,508		15,508		15,508		15,508
1989		535		14,519		15,766		16,245		17,502		18,143		18,147		18,272		18,510		19,044		18,784		19,277		19,136		19,136		19,135		19,134		19,132		19,131		18,672		18,671		19,670		19,684
1990		6,275		14,481		21,375		22,983		23,774		24,618		26,415		26,894		27,729		26,432		26,156		25,420		23,124		23,135		23,144		22,926		22,925		22,925		22,926		22,926		22,926
1991		7,327		27,267		35,319		37,652		39,912		37,979		37,459		36,307		36,484		36,881		37,330		36,704		36,594		36,608		36,471		36,416		36,400		36,394		36,377		36,374
1992		9,049		23,284		47,800		41,135		44,037		37,357		37,683		35,621		35,666		34,920		34,522		35,174		34,833		34,218		34,404		34,396		34,396		34,393		34,393
1993		3,885		51,454		45,841		50,842		44,399		42,523		39,038		37,910		37,640		37,181		38,056		38,024		37,994		37,949		37,735		37,755		37,755		37,815
1994		6,469		23,227		36,514		38,662		35,716		35,073		40,511		39,985		40,249		39,018		37,850		39,026		40,517		40,517		40,563		40,563		40,563
1995		4,314		17,470		18,736		11,687		10,175		10,062		10,015		10,243		10,176		9,743		9,510		9,519		9,519		9,521		9,517		9,517
1996		6,347		11,596		12,696		12,183		11,861		12,335		11,929		12,015		12,024		12,008		12,049		11,355		12,080		12,079		12,108
1997		N/A		N/A		N/A		N/A		15,509		13,828		10,466		10,373		10,157		9,682		9,737		9,772		9,957		10,073
1998		N/A		N/A		N/A		14,610		15,040		14,368		14,577		13,706		13,673		13,630		13,621		13,658		13,658
1999		N/A		N/A		19,915		23,229		24,762		24,602		24,752		24,101		24,194		24,439		24,167		23,816
2000		N/A		35,138		45,693		44,012		44,961		44,957		47,336		47,525		46,193		45,520		45,411
2001		7,049		42,628		40,200		42,501		51,016		49,111		48,800		49,082		48,382		50,165
2002		4,962		28,059		35,625		30,723		38,692		39,616		38,616		38,684		38,768
2003		20,926		49,943		55,371		53,281		53,444		50,427		52,231		52,752
2004		203		3,395		11,640		17,194		14,479		13,480		13,340
2005		297		6,576		5,198		4,934		4,959		4,977
2006		38		1,087		3,218		3,279		3,311
2007		0		164		327		248
2008		50		601		1,581
2009		3,180		3,459
2010		221

* Excludes Dick Corporation in 2005. Last Diagonal is as of 9/30/10.

Accident	Incurred Loss & ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior		1.049		1.073		2.477		0.989		0.986		0.991		1.008		0.997		0.996		0.999		1.000		0.999		0.998		1.000		1.001		1.007		1.000		1.003		0.999		1.000		1.000		1.005		1.001
1988		N/A		20.225		1.063		0.998		1.000		1.010		1.024		1.001		0.989		1.000		1.009		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1989		27.138		1.086		1.030		1.077		1.037		1.000		1.007		1.013		1.029		0.986		1.026		0.993		1.000		1.000		1.000		1.000		1.000		0.976		1.000		1.054		1.001
1990		2.308		1.476		1.075		1.034		1.036		1.073		1.018		1.031		0.953		0.990		0.972		0.910		1.000		1.000		0.991		1.000		1.000		1.000		1.000		1.000
1991		3.721		1.295		1.066		1.060		0.952		0.986		0.969		1.005		1.011		1.012		0.983		0.997		1.000		0.996		0.998		1.000		1.000		1.000		1.000
1992		2.573		2.053		0.861		1.071		0.848		1.009		0.945		1.001		0.979		0.989		1.019		0.990		0.982		1.005		1.000		1.000		1.000		1.000
1993		13.244		0.891		1.109		0.873		0.958		0.918		0.971		0.993		0.988		1.024		0.999		0.999		0.999		0.994		1.001		1.000		1.002
1994		3.591		1.572		1.059		0.924		0.982		1.155		0.987		1.007		0.969		0.970		1.031		1.038		1.000		1.001		1.000		1.000
1995		4.050		1.072		0.624		0.871		0.989		0.995		1.023		0.993		0.957		0.976		1.001		1.000		1.000		1.000		1.000
1996		1.827		1.095		0.960		0.974		1.040		0.967		1.007		1.001		0.999		1.003		0.942		1.064		1.000		1.003
1997		N/A		N/A		N/A		N/A		0.892		0.757		0.991		0.979		0.953		1.006		1.004		1.019		1.016
1998		N/A		N/A		N/A		1.029		0.955		1.015		0.940		0.998		0.997		0.999		1.003		1.000
1999		N/A		N/A		1.166		1.066		0.994		1.006		0.974		1.004		1.010		0.989		0.981
2000		N/A		1.300		0.963		1.022		1.000		1.053		1.004		0.972		0.985		0.997
2001		6.047		0.943		1.057		1.200		0.963		0.994		1.006		0.986		1.049
2002		5.655		1.270		0.862		1.259		1.024		0.975		1.002		1.003
2003		2.387		1.109		0.962		1.003		0.944		1.036		1.013
2004		16.724		3.429		1.477		0.842		0.931		0.986
2005		22.141		0.790		0.949		1.005		1.005
2006		28.605		2.960		1.019		1.013
2007		N/A		1.994		0.692
2008		12.020		3.631
2009		1.119
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		9.071		2.593		1.078		1.016		0.975		0.996		0.994		0.999		0.991		0.996		0.998		1.001		1.000		1.000		0.999		1.001		1.000		0.996		1.000		1.013		1.000		1.002		1.001
Average x 87		9.572		2.677		1.000		1.018		0.975		0.996		0.993		0.999		0.991		0.995		0.997		1.001		1.000		1.000		0.999		1.000		1.000		0.995		1.000		1.018		1.000		1.000
Average x H/L		8.303		1.662		1.022		1.012		0.979		1.001		0.995		0.999		0.989		0.996		1.000		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		N/A		2.794		0.977		1.007		0.970		1.005		1.004		0.995		0.997		1.000		0.995		1.019		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Wtd Average		2.773		1.245		1.176		1.018		0.971		1.002		0.996		0.998		0.995		0.997		1.000		0.999		0.998		1.000		0.999		1.003		1.000		1.000		1.000		1.005		1.000		1.004		1.001
WA x 1987		3.955		1.273		1.001		1.027		0.967		1.006		0.992		0.998		0.995		0.996		1.000		0.998		0.998		1.000		0.999		1.000		1.000		0.996		1.000		1.017		1.001		1.000
Wtd Avg L5		3.362		1.909		1.042		1.050		0.969		1.014		1.003		0.989		1.010		0.997		0.984		1.029		1.001		1.000		1.000		1.000		1.000		0.996		1.000
Selected		3.955		1.909		1.078		1.050		1.015		1.005		1.004		1.003		1.001		1.001		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives		8.828		2.232		1.169		1.084		1.032		1.017		1.012		1.008		1.005		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives		14.716		3.148		1.374		1.105		1.045		1.021		1.013		1.009		1.006		1.004		1.003		1.002		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

WSC Assumed Business
Exhibit K4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss & ALAE Projection*

																			Indicated
																			Ultimate
							Cumulative						Indicated Ultimate						Loss &
Accident	Incurred Loss & ALAE ($000s)						Development Factors						Loss & ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
10/97-12/97		1,602		1,828		1,962		1.002		1.001		1.000		1,605		1,830		1,962		1,962
1998		13,621		13,658		13,658		1.003		1.002		1.001		13,662		13,685		13,672		13,672
1999		24,439		24,167		23,816		1.004		1.003		1.002		24,537		24,240		23,864		23,864
2000		46,193		45,520		45,411		1.005		1.004		1.003		46,424		45,702		45,547		45,547
2001		49,082		48,382		50,165		1.008		1.005		1.004		49,475		48,624		50,366		50,366
2002		38,616		38,684		38,768		1.012		1.008		1.006		39,079		38,993		39,001		39,001
2003		50,427		52,231		52,752		1.017		1.012		1.009		51,284		52,858		53,227		53,227
2004		14,479		13,480		13,340		1.032		1.017		1.013		14,942		13,709		13,513		13,513
2005		4,934		4,959		4,977		1.084		1.032		1.021		5,348		5,118		5,082		5,082
2006		3,218		3,279		3,311		1.169		1.084		1.045		3,762		3,554		3,460		3,460
2007		164		327		248		2.232		1.169		1.105		366		382		274		274
2008		50		601		1,581		8.828		2.232		1.374		441		1,341		2,172		2,172
2009				3,180		3,459				8.828		3.148				28,073		10,889		10,889
2010						221						14.716						3,252		2,439

* Excludes Dick Corporation in 2005.

Note: The 9-Ult Cumulative Loss & ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss & ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit K5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Loss & ALAE* ($000s)

	Selected
Accident	Ultimate		Paid Loss & ALAE						Hindsight Outstanding Loss & ALAE
Year	Loss & ALAE		@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos			@60 Mos
1998		13,674		N/A		13,952		14,416		N/A		(278	)		(742	)
1999		23,865		17,090		19,056		21,275		6,775		4,809			2,590
2000		45,580		40,571		41,072		42,420		5,009		4,508			3,160
2001		50,361		33,931		35,622		41,096		16,430		14,739			9,265
2002		38,986		26,031		27,863		29,904		12,955		11,123			9,082
2003		53,204		48,364		49,581		50,489		4,840		3,623			2,715
2004		13,527		4,443		9,562		13,519		9,084		3,965			8
2005		5,120		1,838		1,798		1,908		3,282		3,322			3,212

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit K6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
	Ultimate
Accident	Reported		Closed Claims						Yet to Close
Year	Claims		@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos		@60 Mos
1998		674		376		439		502		298		235		172
1999		789		318		428		605		471		361		184
2000		906		328		518		612		578		388		294
2001		1,376		562		803		941		814		573		435
2002		1,195		410		588		830		785		607		365
2003		986		363		537		769		623		449		217
2004		601		203		383		438		398		218		163
2005		445		260		318		364		185		127		81

Milliman

WSC Assumed Business
Exhibit K7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

									Average Hindsight Outstanding @9/30/10
									Trended using 5.0% to
Accident	Average Hindsight Outstanding @9/30/10								2008		2007			2006
Year	@36 Mos		@48 Mos			@60 Mos			@36 Mos		@48 Mos			@60 Mos
1998		N/A		(1.183	)		(4.314	)		N/A		(1.835	)		(6.374	)
1999		14.384		13.321			14.076			22.314		19.681			19.806
2000		8.666		11.619			10.748			12.804		16.349			14.403
2001		20.184		25.723			21.299			28.401		34.471			27.184
2002		16.503		18.325			24.882			22.116		23.388			30.244
2003		7.769		8.069			12.512			9.915		9.808			14.484
2004		22.824		18.188			0.049			27.743		21.055			0.054
2005		17.741		26.157			39.654			20.537		28.838			41.637
Selection										23.465		24.427			23.971

	Closed Claims @9/30/10				Indicated Reserve for Claims Yet to Close						Paid		Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Loss & ALAE		Ultimate
Year	Claims		Claim		to Close		Claim		Loss & ALAE		@9/30/10		Loss & ALAE
2006		281		4.011		71		23.971		1,702		1,127		2,829
2007		252		1.726		118		24.427		2,882		435		3,317
2008		198		3.475		262		23.465		6,148		688		6,836

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit K8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Loss & ALAE* ($000s)

	Selected						Hindsight
Accident	Ultimate		Paid Loss & ALAE				Outstanding Loss & ALAE
Year	Loss & ALAE		@12 Mos		@24 Mos		@12 Mos		@24 Mos
2000		45,580		N/A		27,924		N/A		17,656
2001		50,361		10,837		30,680		39,524		19,681
2002		38,986		3,760		13,626		35,226		25,360
2003		53,204		6,757		31,427		46,447		21,777
2004		13,527		125		2,694		13,402		10,833
2005		5,120		0		869		5,120		4,251
2006		3,464		38		603		3,426		2,861
2007		6,801		0		888		6,801		5,913
2008		9,242		50		456		9,192		8,786

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit K9

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
	Ultimate
Accident	Reported		Closed Claims				Yet to Close
Year	Claims		@12 Mos		@24 Mos		@12 Mos		@24 Mos
2000		906		47		170		859		736
2001		1,376		81		315		1,295		1,061
2002		1,195		76		229		1,119		966
2003		986		55		204		931		782
2004		601		28		108		573		493
2005		445		33		106		412		339
2006		352		25		112		327		240
2007		370		31		119		339		251
2008		460		33		141		427		319

Milliman

WSC Assumed Business
Exhibit K10

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

					Average Hindsight Outstanding @9/30/10
					Trended using 5.0% to
Accident	Average Hindsight Outstanding @9/30/10				2010		2009
Year	@12 Mos		@24 Mos		@12 Mos		@24 Mos
2000		N/A		23.989		N/A		37.215
2001		30.520		18.549		47.347		27.405
2002		31.480		26.253		46.510		36.941
2003		49.889		27.848		70.199		37.319
2004		23.389		21.974		31.343		28.045
2005		12.427		12.540		15.860		15.242
2006		10.477		11.921		12.735		13.800
2007		20.062		23.558		23.224		25.973
2008		21.527		27.542		23.734		28.919
Selection						20.939		23.087

	Closed Claims @9/30/10				Indicated Reserve for Claims Yet to Close						Paid		Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Loss & ALAE		Ultimate
Year	Claims		Claim		to Close		Claim		Loss & ALAE		@9/30/10		Loss & ALAE
2009		108		23.796		524		23.087		12,098		2,570		14,668
2010		24		6.708		315		20.939		6,596		161		6,757

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit K11

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection* ($000s)

			Milliman
			Selected
			Gross Ult			A-Priori							Incurred		Indicated
			Loss &			Ultimate		Estimated					Loss &		Ultimate
Accident	Net Earned		ALAE			Loss &		Percent			Indicated		ALAE		Loss &
Year	Premium		Ratio**			ALAE		Unreported			IBNR		@9/30/10		ALAE***
10/97-12/97		12,788		10.8	%		1,381		0.0	%		0		1,962		1,962
1998		105,330		16.1	%		16,958		0.1	%		17		13,658		13,675
1999		118,084		21.0	%		24,798		0.2	%		50		23,816		23,866
2000		123,949		54.0	%		66,932		0.3	%		201		45,411		45,612
2001		131,008		36.5	%		47,818		0.4	%		191		50,165		50,356
2002		121,854		27.6	%		33,632		0.6	%		202		38,768		38,970
2003		114,426		41.7	%		47,716		0.9	%		429		52,752		53,181
2004		79,757		19.4	%		15,473		1.3	%		201		13,340		13,541
2005		71,897		12.0	%		8,628		2.1	%		181		4,977		5,158
2006		75,556		4.8	%		3,627		4.3	%		156		3,311		3,467
2007		80,572		10.5	%		8,460		9.5	%		804		248		1,052
2008		82,924		14.0	%		11,609		27.2	%		3,158		1,581		4,739
2009		73,831		19.8	%		14,619		68.2	%		9,970		3,459		13,429
2010		51,519		22.5	%		15,456		93.2	%		14,405		221		10,970
Total		1,243,495					317,107					29,965		253,669		279,978

*	Excludes Dick Corporation in 2005.
**	Based on Selected Gross Ultimate Loss & ALAE Ratio, Net of Salvage & Subrogation.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months exposure.

Milliman

WSC Assumed Business
Exhibit K12

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection* ($000s)

			Milliman
			Selected
			Gross Ult			A-Priori							Paid		Indicated
			Loss &			Ultimate		Estimated					Loss &		Ultimate
Accident	Net Earned		ALAE			Loss &		Percent			Indicated		ALAE		Loss &
Year	Premium		Ratio**			ALAE		Unpaid			Unpaid		@9/30/10		ALAE***
10/97-12/97		12,788		10.8	%		1,381		0.4	%		6		1,927		1,933
1998		105,330		16.1	%		16,958		0.6	%		102		13,466		13,568
1999		118,084		21.0	%		24,798		0.8	%		198		23,636		23,834
2000		123,949		54.0	%		66,932		1.1	%		736		45,387		46,123
2001		131,008		36.5	%		47,818		1.5	%		717		48,643		49,360
2002		121,854		27.6	%		33,632		2.0	%		673		38,258		38,931
2003		114,426		41.7	%		47,716		2.5	%		1,193		50,942		52,135
2004		79,757		19.4	%		15,473		3.7	%		573		12,924		13,497
2005		71,897		12.0	%		8,628		6.6	%		569		2,097		2,666
2006		75,556		4.8	%		3,627		14.8	%		537		1,127		1,664
2007		80,572		10.5	%		8,460		29.3	%		2,479		435		2,914
2008		82,924		14.0	%		11,609		49.3	%		5,723		688		6,411
2009		73,831		19.8	%		14,619		77.7	%		11,359		2,570		13,929
2010		51,519		22.5	%		15,456		95.7	%		14,791		161		11,214
Total		1,243,495					317,107					39,656		242,261		278,179

*	Excludes Dick Corporation in 2005.
**	Based on Selected Gross Ultimate Loss & ALAE Ratio, Net of Salvage & Subrogation.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months exposure.

Milliman

WSC Assumed Business
Exhibit K13

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Loss & ALAE Ratio Method* ($000s)

	Selected Ultimate		Net Earned		Net Ultimate
Accident	Loss & ALAE		Premium		Loss & ALAE Ratio
Year	@9/30/10		@9/30/10		@9/30/10
10/97-12/97		1,962		12,788		15.3	%
1998		13,674		105,330		13.0	%
1999		23,865		118,084		20.2	%
2000		45,580		123,949		36.8	%
2001		50,361		131,008		38.4	%
2002		38,986		121,854		32.0	%
2003		53,204		114,426		46.5	%
2004		13,527		79,757		17.0	%
2005		5,120		71,897		7.1	%
Total		246,279		879,093		28.0	%

	(a)		(b)			(a) x (b)
						Indicated
Accident	Net Earned		Selected Loss &			Ultimate
Year	Premium		ALAE Ratio			Loss & ALAE
2006		75,556		28.0	%		21,156
2007		80,572		28.0	%		22,560
2008		82,924		28.0	%		23,219

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit K14

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Loss & ALAE Ratio Method* ($000s)

	Selected Ultimate		Net Earned		Net Ultimate
Accident	Loss & ALAE		Premium		Loss & ALAE Ratio
Year	@9/30/10		@9/30/10		@9/30/10
10/97-12/97		1,962		12,788		15.3	%
1998		13,674		105,330		13.0	%
1999		23,865		118,084		20.2	%
2000		45,580		123,949		36.8	%
2001		50,361		131,008		38.4	%
2002		38,986		121,854		32.0	%
2003		53,204		114,426		46.5	%
2004		13,527		79,757		17.0	%
2005		5,120		71,897		7.1	%
2006		3,464		75,556		4.6	%
2007		6,801		80,572		8.4	%
2008		9,242		82,924		11.1	%
Total		265,786		1,118,145		23.8	%
Last 7		130,344		626,986		20.8	%

	(a)		(b)			(a) x (b)
						Indicated
Accident	Net Earned		Selected Loss &			Ultimate
Year	Premium		ALAE Ratio			Loss & ALAE
2009		73,831		20.8	%		15,357
2010		51,519		20.8	%		10,716

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit K15

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 10/97 — 2010 Ultimate Loss & ALAE* ($000s)

																	Selected		Ultimate
	Incurred				Indicated Ultimate Loss & ALAE**												Ultimate		Loss &
	Loss &		Net		Paid		Incurred		Average		Incurred		Paid		Loss &		Loss &		ALAE
Accident	ALAE		Earned		Loss		Loss		Hindsight		B/F		B/F		ALAE Ratio		ALAE		Ratio
Year	@9/30/10		Premium**		Projection		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
10/97-12/97		1,962		12,788		1,935		1,962		N/A		1,962		1,933		N/A		1,962		15.3	%
1998		13,658		105,330		13,547		13,672		N/A		13,675		13,568		N/A		13,674		13.0	%
1999		23,816		118,084		23,825		23,864		N/A		23,866		23,834		N/A		23,865		20.2	%
2000		45,411		123,949		45,886		45,547		N/A		45,612		46,123		N/A		45,580		36.8	%
2001		50,165		131,008		49,373		50,366		N/A		50,356		49,360		N/A		50,361		38.4	%
2002		38,768		121,854		39,023		39,001		N/A		38,970		38,931		N/A		38,986		32.0	%
2003		52,752		114,426		52,266		53,227		N/A		53,181		52,135		N/A		53,204		46.5	%
2004		13,340		79,757		13,415		13,513		N/A		13,541		13,497		N/A		13,527		17.0	%
2005		4,977		71,897		2,246		5,082		N/A		5,158		2,666		N/A		5,120		7.1	%
2006		3,311		75,556		1,323		3,460		2,829		3,467		1,664		21,156		3,464		4.6	%
2007		248		80,572		616		274		3,317		1,052		2,914		22,560		6,801		8.4	%
2008		1,581		82,924		1,357		2,172		6,836		4,739		6,411		23,219		9,242		11.1	%
2009		3,459		73,831		11,524		10,889		14,668		13,429		13,929		15,357		14,238		19.3	%
2010		221		51,519		2,808		2,439		6,757		10,970		11,214		10,716		10,967		21.3	%
Total		253,669		1,243,495		259,144		265,468				279,978		278,179				290,991		23.4	%

*	Excludes Dick Corporation in 2005.
**	Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Assumed Business
Exhibit K16

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET CONTRACT SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE* ($000s)

												Unpaid
Accident	Ultimate		Paid		Incurred		Case			IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding			@9/30/10		@9/30/10
10/97-12/97		1,962		1,927		1,962		35			0		35
1998		13,674		13,466		13,658		192			16		208
1999		23,865		23,636		23,816		180			49		229
2000		45,580		45,387		45,411		24			169		193
2001		50,361		48,643		50,165		1,522			196		1,718
2002		38,986		38,258		38,768		510			218		728
2003		53,204		50,942		52,752		1,810			452		2,262
2004		13,527		12,924		13,340		416			187		603
2005		5,120		2,097		4,977		2,880			143		3,023
2006		3,464		1,127		3,311		2,184			153		2,337
2007		6,801		435		248		(187	)		6,553		6,366
2008		9,242		688		1,581		893			7,661		8,554
2009		14,238		2,570		3,459		889			10,779		11,668
2010		10,967		161		221		60			10,746		10,806
Total		290,991		242,261		253,669		11,408			37,322		48,730

* Excludes Dick Corporation in 2005.

Milliman

WSC Assumed Business
Exhibit L1

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident		Paid Loss & ALAE* ($000s)
Year		12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior			25,059		28,717		29,020		47,753		48,383		49,378		49,593		52,538		53,336		53,770		54,874		55,107		56,479		56,501		57,049		57,947		59,216		60,730		62,225		61,701		63,130		62,774		64,331		63,382
1988			38		638		2,424		2,969		3,597		3,803		3,948		3,932		4,374		4,422		4,436		4,476		4,474		4,473		4,472		4,471		4,471		4,471		4,454		4,455		4,457		4,457		4,457
1989			168		2,598		3,818		4,324		6,007		7,788		7,892		6,640		6,753		6,822		6,829		6,851		6,873		6,873		6,871		6,890		6,882		6,884		6,882		6,882		6,882		6,882
1990			3,027		6,462		8,013		8,223		13,113		12,031		12,053		11,756		11,574		11,550		11,540		11,657		11,668		11,669		11,674		11,680		11,680		11,680		11,680		11,680		11,665
1991			580		2,526		3,492		4,603		9,947		9,948		9,908		9,916		10,045		9,963		9,985		10,029		10,037		10,030		10,033		10,031		10,034		10,038		10,038		10,038
1992			274		1,384		1,889		2,245		2,538		2,725		2,841		2,871		3,309		3,336		3,338		3,362		3,376		3,377		3,378		3,473		3,480		3,476		3,471
1993			490		1,428		2,037		2,486		2,583		2,595		2,532		2,561		2,713		2,829		2,857		2,906		2,978		3,011		3,039		3,040		3,040		3,040
1994			252		817		1,786		2,317		2,405		2,698		2,936		2,952		2,792		2,804		2,819		2,824		2,827		2,835		2,846		2,859		2,863
1995			32		797		1,569		1,806		2,038		2,263		2,378		2,466		2,478		2,450		2,461		2,486		2,487		2,492		2,493		2,498
1996			563		1,110		2,494		2,960		3,233		3,283		3,486		4,124		4,238		4,180		4,174		4,196		4,194		4,018		4,026
1997			N/A		N/A		N/A		N/A		1,907		2,241		2,702		2,588		2,587		2,555		2,529		2,529		2,529		2,527
1998			N/A		N/A		N/A		6,445		6,640		6,774		6,817		6,817		6,951		6,963		6,866		6,871		6,877
1999			N/A		N/A		7,152		8,572		9,247		7,970		7,994		8,163		4,337		4,019		3,968		4,043
2000			N/A		6,221		2,111		5,929		6,228		6,280		6,241		6,487		6,264		6,268		6,136
2001			2,452		2,385		8,377		13,986		16,169		16,239		17,036		17,069		17,080		17,100
2002			N/A		N/A		N/A		3,182		3,256		3,301		3,385		3,428		3,467
2003			19,960		17,622		19,061		21,757		23,035		23,862		24,112		23,502
2004			259		1,141		1,620		2,094		2,070		1,930		1,949
2005			71		1,084		1,624		1,873		1,978		768
2006			124		378		709		729		319
2007			86		214		424		503
2008			123		311		332
2009			26		62
2010			8
*		Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009. Last Diagonal is as of 9/30/10.
Accident		Paid Loss & ALAE Development Factors**
Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior			1.146		1.011		1.646		1.013		1.021		1.004		1.059		1.015		1.008		1.021		1.004		1.025		1.000		1.010		1.016		1.022		1.026		1.025		0.992		1.023		0.994		1.025		0.980
1988			16.789		3.799		1.225		1.212		1.057		1.038		0.996		1.112		1.011		1.003		1.009		1.000		1.000		1.000		1.000		1.000		1.000		0.996		1.000		1.000		1.000		1.000
1989			15.464		1.470		1.133		1.389		1.296		1.013		0.841		1.017		1.010		1.001		1.003		1.003		1.000		1.000		1.003		0.999		1.000		1.000		1.000		1.000		1.000
1990			2.135		1.240		1.026		1.595		0.917		1.002		0.975		0.985		0.998		0.999		1.010		1.001		1.000		1.000		1.001		1.000		1.000		1.000		1.000		0.998
1991			4.355		1.382		1.318		2.161		1.000		0.996		1.001		1.013		0.992		1.002		1.004		1.001		0.999		1.000		1.000		1.000		1.000		1.000		1.000
1992			5.051		1.365		1.188		1.131		1.074		1.043		1.011		1.153		1.008		1.001		1.007		1.004		1.000		1.000		1.028		1.002		0.999		0.998
1993			2.914		1.426		1.220		1.039		1.005		0.976		1.011		1.059		1.043		1.010		1.017		1.025		1.011		1.009		1.000		1.000		1.000
1994			3.242		2.186		1.297		1.038		1.122		1.088		1.005		0.946		1.004		1.005		1.002		1.001		1.003		1.004		1.005		1.002
1995			24.906		1.969		1.151		1.128		1.110		1.051		1.037		1.005		0.989		1.004		1.010		1.000		1.002		1.000		1.003
1996			1.972		2.247		1.187		1.092		1.015		1.062		1.183		1.028		0.986		0.999		1.005		1.000		0.958		1.003
1997			N/A		N/A		N/A		N/A		1.175		1.206		0.958		1.000		0.988		0.990		1.000		1.000		0.999
1998			N/A		N/A		N/A		1.030		1.020		1.006		1.000		1.020		1.002		0.986		1.001		1.001
1999			N/A		N/A		1.199		1.079		0.862		1.003		1.021		0.531		0.927		0.987		1.025
2000			N/A		0.339		2.809		1.050		1.008		0.994		1.039		0.966		1.001		0.972
2001			0.973		3.512		1.670		1.156		1.004		1.049		1.002		1.001		1.002
2002			N/A		N/A		N/A		1.023		1.014		1.025		1.013		1.015
2003			0.883		1.082		1.141		1.059		1.036		1.010		0.966
2004			4.405		1.420		1.293		0.989		0.932		1.013
2005			15.268		1.498		1.153		1.056		0.283
2006			3.048		1.876		1.028		0.332
2007			2.488		1.981		1.256
2008			2.528		1.091
2009			3.186
**	Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average			6.153		1.716		1.330		1.135		0.998		1.032		1.007		0.992		0.998		0.999		1.008		1.005		0.998		1.003		1.006		1.003		1.004		1.003		0.998		1.005		0.998		1.012		0.980
Average x 87			6.448		1.758		1.311		1.142		0.996		1.034		1.004		0.990		0.997		0.997		1.008		1.003		0.997		1.002		1.005		1.000		1.000		0.999		1.000		1.000		1.000		1.000
Average x H/L			5.310		1.672		1.257		1.122		1.022		1.025		1.006		1.013		1.000		0.999		1.007		1.004		1.000		1.002		1.004		1.001		1.000		0.999		1.000		1.000		1.000
Avg L5 x H/L			2.921		1.598		1.184		1.023		0.984		1.016		1.012		0.994		0.997		0.988		1.005		1.000		1.001		1.002		1.003		1.001		1.000		0.999		1.000
Wtd Average			1.301		1.197		1.385		1.128		1.008		1.016		1.011		0.986		1.001		1.007		1.006		1.013		0.999		1.006		1.010		1.013		1.015		1.015		0.995		1.017		0.995		1.023		0.980
WA x 1987			1.437		1.311		1.274		1.185		1.003		1.021		0.990		0.970		0.997		0.996		1.007		1.002		0.997		1.001		1.003		1.000		1.000		0.999		1.000		0.999		1.000		1.000
Wtd Avg L5			4.814		1.508		1.151		1.032		0.987		1.022		0.995		0.908		0.992		0.985		1.008		1.001		0.991		1.003		1.005		1.000		1.000		0.999		0.995
Selected			6.448		1.598		1.149		1.032		1.022		1.025		1.012		1.013		1.008		1.007		1.007		1.005		1.004		1.003		1.003		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.000
		12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives			13.837		2.146		1.343		1.169		1.133		1.109		1.082		1.069		1.055		1.047		1.040		1.033		1.028		1.024		1.021		1.018		1.016		1.015		1.014		1.013		1.012		1.011		1.010		1.010
		9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives			22.383		3.420		1.510		1.210		1.142		1.115		1.089		1.072		1.058		1.049		1.042		1.035		1.029		1.025		1.022		1.019		1.017		1.015		1.014		1.013		1.012		1.011		1.010		1.010

Milliman

WSC Assumed Business
Exhibit L2

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss & ALAE Projection*

																			Indicated
																			Ultimate
							Cumulative						Indicated Ultimate						Loss &
Accident	Paid Loss & ALAE ($000s)						Development Factors						Loss & ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
10/97-12/97		375		375		375		1.033		1.028		1.025		387		386		384		384
1998		6,866		6,871		6,877		1.040		1.033		1.029		7,141		7,098		7,076		7,076
1999		4,019		3,968		4,043		1.047		1.040		1.035		4,208		4,127		4,185		4,185
2000		6,264		6,268		6,136		1.055		1.047		1.042		6,609		6,563		6,394		6,394
2001		17,069		17,080		17,100		1.069		1.055		1.049		18,247		18,019		17,938		17,938
2002		3,385		3,428		3,467		1.082		1.069		1.058		3,663		3,665		3,668		3,668
2003		23,862		24,112		23,502		1.109		1.082		1.072		26,463		26,089		25,194		25,194
2004		2,070		1,930		1,949		1.133		1.109		1.089		2,345		2,140		2,122		2,122
2005		1,873		1,978		768		1.169		1.133		1.115		2,190		2,241		856		856
2006		709		729		319		1.343		1.169		1.142		952		852		364		364
2007		214		424		503		2.146		1.343		1.210		459		569		609		609
2008		123		311		332		13.837		2.146		1.510		1,702		667		501		501
2009				26		62				13.837		3.420				360		212		212
2010						8						22.383						179		134

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
Note:	The 9-Ult Cumulative Loss & ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss & ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit L3

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident		Incurred Loss & ALAE* ($000s)
Year		12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192		204		216		228		240		252		264		276		288
1987&Prior			27,389		30,850		34,429		54,037		54,208		54,027		51,871		55,617		56,183		55,060		56,542		57,884		58,228		58,051		58,315		59,187		65,594		65,606		65,883		68,174		68,239		69,131		69,419		68,462
1988			233		946		3,299		3,237		3,728		3,898		4,515		4,826		4,401		4,445		4,446		4,476		4,474		4,473		4,472		4,471		4,471		4,471		4,454		4,457		4,457		4,457		4,457
1989			309		3,011		4,063		4,618		7,509		6,135		8,163		6,755		6,810		6,824		7,137		7,157		6,881		6,881		6,879		6,890		6,882		6,884		6,882		6,882		6,882		6,882
1990			3,686		8,165		9,345		10,750		14,345		12,841		12,199		11,826		11,685		11,662		11,541		11,658		11,669		11,669		11,675		11,680		11,680		11,680		11,681		11,681		11,665
1991			1,257		2,939		3,736		4,696		9,931		10,034		9,984		9,991		10,051		9,963		9,985		10,029		10,037		10,030		10,033		10,031		10,034		10,038		10,038		10,038
1992			584		1,589		2,187		2,438		2,799		2,823		2,966		2,984		3,312		3,339		3,341		3,362		3,377		3,377		3,378		3,473		3,480		3,476		3,471
1993			563		1,795		2,344		2,596		2,684		2,632		2,596		2,566		2,732		2,913		2,934		3,009		3,042		3,011		3,039		3,040		3,040		3,040
1994			543		1,593		2,368		2,377		2,481		3,020		3,007		2,952		2,792		2,804		2,819		2,824		2,827		2,835		2,846		2,859		2,863
1995			169		976		1,912		2,022		2,279		2,471		2,465		2,508		2,529		2,456		2,478		2,491		2,487		2,492		2,493		2,498
1996			612		2,640		2,754		3,084		3,300		3,356		3,488		4,124		4,238		4,180		4,174		4,196		4,369		4,018		4,026
1997			N/A		N/A		N/A		N/A		2,114		2,357		2,795		2,619		2,590		2,555		2,529		2,529		2,529		2,527
1998			N/A		N/A		N/A		9,494		9,693		9,808		10,505		10,457		10,498		10,508		7,405		7,423		7,417
1999			N/A		N/A		7,249		8,816		9,307		8,024		8,005		8,163		4,438		4,069		4,019		4,093
2000			N/A		8,988		7,230		6,296		6,305		6,315		6,339		6,490		6,268		6,268		6,136
2001			17,789		15,432		17,552		25,337		22,687		22,706		17,106		17,138		17,149		17,169
2002			N/A		N/A		N/A		3,266		3,336		3,209		3,214		3,257		3,505
2003			21,401		14,467		21,417		22,361		23,973		23,924		24,112		23,502
2004			1,300		2,328		5,665		5,882		4,453		2,090		2,090
2005			369		1,713		1,934		1,965		1,978		776
2006			671		760		742		803		359
2007			86		214		456		509
2008			143		332		357
2009			26		62
2010			8
*		Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009. Last Diagonal is as of 9/30/10.
Accident		Incurred Loss & ALAE Development Factors**
Year		12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - 204		204 - 216		216 - 228		228 - 240		240 - 252		252 - 264		264 - 276		276 - 288
1987&Prior			1.126		1.116		1.570		1.003		0.997		0.960		1.072		1.010		0.980		1.027		1.024		1.006		0.997		1.005		1.015		1.108		1.000		1.004		1.035		1.001		1.013		1.004		0.982
1988			4.060		3.487		0.981		1.152		1.046		1.158		1.069		0.912		1.010		1.000		1.007		1.000		1.000		1.000		1.000		1.000		1.000		0.996		1.001		1.000		1.000		1.000
1989			9.744		1.349		1.137		1.626		0.817		1.331		0.828		1.008		1.002		1.046		1.003		0.961		1.000		1.000		1.002		0.999		1.000		1.000		1.000		1.000		1.000
1990			2.215		1.145		1.150		1.334		0.895		0.950		0.969		0.988		0.998		0.990		1.010		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		0.998
1991			2.338		1.271		1.257		2.115		1.010		0.995		1.001		1.006		0.991		1.002		1.004		1.001		0.999		1.000		1.000		1.000		1.000		1.000		1.000
1992			2.721		1.376		1.115		1.148		1.009		1.051		1.006		1.110		1.008		1.001		1.006		1.004		1.000		1.000		1.028		1.002		0.999		0.998
1993			3.188		1.306		1.108		1.034		0.981		0.986		0.988		1.065		1.066		1.007		1.026		1.011		0.990		1.009		1.000		1.000		1.000
1994			2.934		1.487		1.004		1.044		1.217		0.996		0.982		0.946		1.004		1.005		1.002		1.001		1.003		1.004		1.005		1.002
1995			5.775		1.959		1.058		1.127		1.084		0.998		1.017		1.008		0.971		1.009		1.005		0.998		1.002		1.000		1.003
1996			4.314		1.043		1.120		1.070		1.017		1.039		1.182		1.028		0.986		0.999		1.005		1.041		0.920		1.003
1997			N/A		N/A		N/A		N/A		1.115		1.186		0.937		0.989		0.986		0.990		1.000		1.000		0.999
1998			N/A		N/A		N/A		1.021		1.012		1.071		0.995		1.004		1.001		0.705		1.002		0.999
1999			N/A		N/A		1.216		1.056		0.862		0.998		1.020		0.544		0.917		0.988		1.025
2000			N/A		0.804		0.871		1.001		1.002		1.004		1.024		0.966		1.000		0.972
2001			0.868		1.137		1.444		0.895		1.001		0.753		1.002		1.001		1.002
2002			N/A		N/A		N/A		1.021		0.962		1.002		1.013		1.103
2003			0.676		1.480		1.044		1.072		0.998		1.008		0.966
2004			1.791		2.433		1.038		0.757		0.469		1.000
2005			4.642		1.129		1.016		1.007		0.287
2006			1.133		0.976		1.082		0.342
2007			2.488		2.131		1.158
2008			2.322		1.102
2009			3.186
**	Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average			3.084		1.485		1.132		1.096		0.936		1.027		1.004		0.980		0.995		0.981		1.009		1.002		0.992		1.002		1.006		1.014		1.000		1.000		1.007		1.000		1.004		1.002		0.982
Average x 87			3.200		1.507		1.106		1.101		0.932		1.031		1.000		0.978		0.996		0.978		1.008		1.002		0.991		1.002		1.005		1.000		1.000		0.999		1.000		0.999		1.000		1.000
Average x H/L			2.819		1.403		1.120		1.081		0.957		1.025		1.004		1.002		0.995		0.999		1.008		1.002		0.999		1.002		1.003		1.001		1.000		0.999		1.000		1.000		1.000
Avg L5 x H/L			2.665		1.454		1.055		0.928		0.810		1.002		1.012		0.990		0.996		0.983		1.004		1.000		0.997		1.002		1.003		1.001		1.000		0.999		1.000
Wtd Average			1.165		1.234		1.258		1.064		0.963		0.976		1.013		0.980		0.990		0.987		1.015		1.003		0.995		1.003		1.010		1.063		1.000		1.002		1.023		1.000		1.011		1.004		0.982
WA x 1987			1.186		1.287		1.144		1.092		0.950		0.983		0.988		0.963		0.996		0.957		1.007		0.999		0.993		1.001		1.003		1.000		1.000		0.999		1.000		0.999		1.000		1.000
Wtd Avg L5			2.395		1.714		1.044		0.992		0.930		0.908		0.993		0.922		0.991		0.878		1.007		1.008		0.976		1.003		1.005		1.000		1.000		0.999		1.023
Selected			2.665		1.454		1.106		1.030		1.000		1.002		1.012		1.005		1.005		1.005		1.004		1.003		1.002		1.002		1.002		1.001		1.001		1.001		1.001		1.001		1.001		1.001		1.000
		12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult		204-Ult		216-Ult		228-Ult		240-Ult		252-Ult		264-Ult		276-Ult		288-Ult
Dec Cumulatives			4.645		1.743		1.199		1.084		1.052		1.052		1.050		1.038		1.033		1.028		1.023		1.019		1.016		1.014		1.012		1.010		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.003
		9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult		201-Ult		213-Ult		225-Ult		237-Ult		249-Ult		261-Ult		273-Ult		285-Ult
Sep Cumulatives			6.513		2.227		1.317		1.112		1.060		1.052		1.051		1.041		1.034		1.029		1.024		1.020		1.017		1.015		1.013		1.011		1.009		1.008		1.007		1.006		1.005		1.004		1.003		1.003

Milliman

WSC Assumed Business
Exhibit L4

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss & ALAE Projection*

																			Indicated
																			Ultimate
							Cumulative						Indicated Ultimate						Loss &
Accident	Incurred Loss & ALAE ($000s)						Development Factors						Loss & ALAE ($000s)						ALAE
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		($000s)
10/97-12/97		375		375		375		1.019		1.016		1.015		382		381		381		381
1998		7,405		7,423		7,417		1.023		1.019		1.017		7,575		7,564		7,543		7,543
1999		4,069		4,019		4,093		1.028		1.023		1.020		4,183		4,111		4,175		4,175
2000		6,268		6,268		6,136		1.033		1.028		1.024		6,475		6,444		6,283		6,283
2001		17,138		17,149		17,169		1.038		1.033		1.029		17,789		17,715		17,667		17,667
2002		3,214		3,257		3,505		1.050		1.038		1.034		3,375		3,381		3,624		3,624
2003		23,924		24,112		23,502		1.052		1.050		1.041		25,168		25,318		24,466		24,466
2004		4,453		2,090		2,090		1.052		1.052		1.051		4,685		2,199		2,197		2,197
2005		1,965		1,978		776		1.084		1.052		1.052		2,130		2,081		816		816
2006		742		803		359		1.199		1.084		1.060		890		870		381		381
2007		214		456		509		1.743		1.199		1.112		373		547		566		566
2008		143		332		357		4.645		1.743		1.317		664		579		470		470
2009				26		62				4.645		2.227				121		138		138
2010						8						6.513						52		39

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
Note:	The 9-Ult Cumulative Loss & ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss & ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

WSC Assumed Business
Exhibit L5

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Loss* ($000s)

	Selected
Accident	Ultimate		Paid Loss & ALAE						Hindsight Outstanding Loss & ALAE
Year	Loss & ALAE		@36 Mos		@48 Mos		@60 Mos		@36 Mos			@48 Mos			@60 Mos
1998		7,543		N/A		6,445		6,640		N/A			1,098			903
1999		4,426		7,152		8,572		9,247		(2,726	)		(4,146	)		(4,821	)
2000		6,677		2,111		5,929		6,228		4,566			748			449
2001		17,791		8,377		13,986		16,169		9,414			3,805			1,622
2002		3,603		N/A		3,182		3,256		N/A			421			347
2003		24,152		19,061		21,757		23,035		5,091			2,395			1,117
2004		2,145		1,620		2,094		2,070		525			51			75
2005		826		1,624		1,873		1,978		(798	)		(1,047	)		(1,152	)

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit L6

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
Accident	Ultimate		Closed Claims						Yet to Close
Year	Reported Claims		@36 Mos		@48 Mos		@60 Mos		@36 Mos		@48 Mos		@60 Mos
1998		509		266		304		345		243		205		164
1999		445		200		232		332		245		213		113
2000		412		142		231		288		270		181		124
2001		487		179		304		324		308		183		163
2002		395		190		215		250		205		180		145
2003		291		130		166		200		161		125		91
2004		212		108		148		165		104		64		47
2005		110		59		67		82		51		43		28

Milliman

WSC Assumed Business
Exhibit L7

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

										Average Hindsight Outstanding @9/30/10
										Trended using 5.0% to
Accident	Average Hindsight Outstanding @9/30/10									2008			2007			2006
Year	@36 Mos			@48 Mos			@60 Mos			@36 Mos			@48 Mos			@60 Mos
1998		N/A			5.356			5.506			N/A			14.211			13.913
1999		(11.127	)		(19.465	)		(42.664	)		(17.262	)		(28.759	)		(60.033	)
2000		16.911			4.133			3.621			24.985			5.816			4.852
2001		30.565			20.792			9.951			43.008			27.863			12.700
2002		N/A			2.339			2.393			N/A			2.985			2.909
2003		31.621			19.160			12.275			40.357			23.289			14.210
2004		5.048			0.797			1.596			6.136			0.923			1.760
2005		(15.647	)		(24.349	)		(41.143	)		(18.113	)		(26.845	)		(43.200	)
Selection											13.847			10.000			8.000

	Closed Claims @9/30/10				Indicated Reserve for Claims Yet to Close						Paid		Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Loss & ALAE		Ultimate
Year	Claims		Claim		to Close		Claim		Loss & ALAE		@9/30/10		Loss & ALAE
2006		48		6.646		23		8.000		184		319		503
2007		39		12.897		43		10.000		430		503		933
2008		30		11.067		64		13.847		886		332		1,218

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit L8

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Hindsight Outstanding Loss & ALAE* ($000s)

	Selected						Hindsight
Accident	Ultimate		Paid Loss & ALAE				Outstanding Loss & ALAE
Year	Losses		@12 Mos		@24 Mos		@12 Mos		@24 Mos
2000		6,677		N/A		6,221		N/A		456
2001		17,791		2,452		2,385		15,339		15,406
2002		3,603		N/A		N/A		N/A		N/A
2003		24,152		19,960		17,622		4,192		6,530
2004		2,145		259		1,141		1,886		1,004
2005		826		71		1,084		755		(258	)
2006		386		124		378		262		8
2007		643		86		214		557		429
2008		798		123		311		675		487

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit L9

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Yet to Close

	Selected
	Ultimate
Accident	Reported		Closed Claims				Yet to Close
Year	Claims		@12 Mos		@24 Mos		@12 Mos		@24 Mos
2000		412		30		89		382		323
2001		487		24		109		463		378
2002		395		44		107		351		288
2003		291		19		89		272		202
2004		212		27		73		185		139
2005		110		12		39		98		71
2006		71		9		25		62		46
2007		82		5		12		77		70
2008		94		8		23		86		71

Milliman

WSC Assumed Business
Exhibit L10

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Average Hindsight Outstanding Projection* ($000s)

						Average Hindsight Outstanding @9/30/10
						Trended using 5.0% to
Accident	Average Hindsight Outstanding @9/30/10					2010		2009
Year	@12 Mos		@24 Mos			@12 Mos		@24 Mos
2000		N/A		1.412			N/A		2.190
2001		33.130		40.757			51.396		60.217
2002		N/A		N/A			N/A		N/A
2003		15.412		32.327			21.686		43.321
2004		10.195		7.223			13.662		9.219
2005		7.704		(3.634	)		9.832		(4.417	)
2006		4.226		0.174			5.137		0.201
2007		7.234		6.129			8.374		6.757
2008		7.849		6.859			8.654		7.202
Selection							8.953		4.720

	Closed Claims @9/30/10				Indicated Reserve for Claims Yet to Close						Paid		Indicated
Accident	Closed		Average		Claims Yet		Average		Outstanding		Loss & ALAE		Ultimate
Year	Claims		Claim		to Close		Claim		Loss & ALAE		@9/30/10		Loss & ALAE
2009		19		3.263		60		4.720		283		62		345
2010		0		N/A		43		8.953		385		8		393

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit L11

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection* ($000s)

			Milliman
			Selected
			Gross Ult			A Priori							Incurred		Indicated
			Loss &			Ultimate		Estimated					Loss &		Ultimate
Accident	Net Earned		ALAE			Loss &		Percent			Indicated		ALAE		Loss &
Year	Premium		Ratio**			ALAE		Unreported			IBNR		@9/30/10		ALAE***
10/97-12/97		12,788		5.3	%		678		1.5	%		10		375		385
1998		44,907		16.4	%		7,365		1.7	%		125		7,417		7,542
1999		52,850		33.9	%		17,916		2.0	%		358		4,093		4,451
2000		58,607		40.0	%		23,443		2.3	%		539		6,136		6,675
2001		62,655		30.6	%		19,172		2.8	%		537		17,169		17,706
2002		36,530		6.6	%		2,411		3.3	%		80		3,505		3,585
2003		16,058		58.0	%		9,314		3.9	%		363		23,502		23,865
2004		27,270		5.6	%		1,527		4.9	%		75		2,090		2,165
2005		16,078		4.8	%		772		4.9	%		38		776		814
2006		14,332		3.8	%		545		5.7	%		31		359		390
2007		11,308		8.8	%		995		10.1	%		100		509		609
2008		10,786		14.5	%		1,564		24.1	%		377		357		734
2009		9,155		17.1	%		1,566		55.1	%		863		62		925
2010		6,403		20.5	%		1,750		84.6	%		1,481		8		1,117
Total		379,727					89,018					4,977		66,358		70,963

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
**	Based on Selected Gross Ultimate Loss & ALAE Ratio, Net of Salvage & Subrogation.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months exposure.

Milliman

WSC Assumed Business
Exhibit L12

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Bornhuetter/Ferguson Projection* ($000s)

			Milliman
			Selected
			Gross Ult			A Priori							Paid		Indicated
			Loss &			Ultimate		Estimated					Loss &		Ultimate
Accident	Net Earned		ALAE			Loss &		Percent			Indicated		ALAE		Loss &
Year	Premium		Ratio**			ALAE		Unpaid			Unpaid		@9/30/10		ALAE***
10/97-12/97		12,788		5.3	%		678		2.4	%		16		375		391
1998		44,907		16.4	%		7,365		2.8	%		206		6,877		7,083
1999		52,850		33.9	%		17,916		3.4	%		609		4,043		4,652
2000		58,607		40.0	%		23,443		4.0	%		938		6,136		7,074
2001		62,655		30.6	%		19,172		4.7	%		901		17,100		18,001
2002		36,530		6.6	%		2,411		5.5	%		133		3,467		3,600
2003		16,058		58.0	%		9,314		6.7	%		624		23,502		24,126
2004		27,270		5.6	%		1,527		8.2	%		125		1,949		2,074
2005		16,078		4.8	%		772		10.3	%		80		768		848
2006		14,332		3.8	%		545		12.4	%		68		319		387
2007		11,308		8.8	%		995		17.4	%		173		503		676
2008		10,786		14.5	%		1,564		33.8	%		529		332		861
2009		9,155		17.1	%		1,566		70.8	%		1,109		62		1,171
2010		6,403		20.5	%		1,750		95.5	%		1,671		8		1,259
Total		379,727					89,018					7,182		65,441		72,203

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
**	Based on Selected Gross Ultimate Loss & ALAE Ratio, Net of Salvage & Subrogation.
***	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months exposure.

Milliman

WSC Assumed Business
Exhibit L13

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Loss & ALAE Ratio Method* ($000s)

	Selected Ultimate		Net Earned		Net Ultimate
Accident	Loss & ALAE		Premium		Loss & ALAE Ratio
Year	@9/30/10		@9/30/10		@9/30/10
10/97-12/97		383		12,788		3.0	%
1998		7,543		44,907		16.8	%
1999		4,426		52,850		8.4	%
2000		6,677		58,607		11.4	%
2001		17,791		62,655		28.4	%
2002		3,603		36,530		9.9	%
2003		24,152		16,058		150.4	%
2004		2,145		27,270		7.9	%
2005		826		16,078		5.1	%
Total		67,546		327,743		20.6	%

	(a)		(b)			(a) x (b)
						Indicated
Accident	Net Earned		Selected Loss &			Ultimate
Year	Premium		ALAE Ratio			Loss & ALAE
2006		14,332		20.6	%		2,952
2007		11,308		20.6	%		2,329
2008		10,786		20.6	%		2,222

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit L14

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Loss & ALAE Ratio Method* ($000s)

	Selected Ultimate		Net Earned		Net Ultimate
Accident	Loss & ALAE		Premium		Loss & ALAE Ratio
Year	@9/30/10		@9/30/10		@9/30/10
10/97-12/97		383		12,788		3.0	%
1998		7,543		44,907		16.8	%
1999		4,426		52,850		8.4	%
2000		6,677		58,607		11.4	%
2001		17,791		62,655		28.4	%
2002		3,603		36,530		9.9	%
2003		24,152		16,058		150.4	%
2004		2,145		27,270		7.9	%
2005		826		16,078		5.1	%
2006		386		14,332		2.7	%
2007		643		11,308		5.7	%
2008		798		10,786		7.4	%
Total		69,373		364,169		19.0	%

	(a)		(b)			(a) x (b)
						Indicated
Accident	Net Earned		Selected Loss &			Ultimate
Year	Premium		ALAE Ratio			Loss & ALAE
2009		9,155		19.0	%		1,739
2010		6,403		19.0	%		1,217

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit L15

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 10/97 — 2010 Ultimate Loss & ALAE* ($000s)

																	Selected		Ultimate
	Incurred				Indicated Ultimate Loss & ALAE**												Ultimate		Loss &
	Loss &		Net		Paid		Incurred		Average		Incurred		Paid		Loss &		Loss &		ALAE
Accident	ALAE		Earned		Loss		Loss		Hindsight		B/F		B/F		ALAE Ratio		ALAE		Ratio
Year	@9/30/10		Premium**		Projection		Projection		Projection		Projection		Projection		Projection		@9/30/10		@9/30/10
10/97-12/97		375		12,788		384		381		N/A		385		391		N/A		383		3.0	%
1998		7,417		44,907		7,076		7,543		N/A		7,542		7,083		N/A		7,543		16.8	%
1999		4,093		52,850		4,185		4,175		N/A		4,451		4,652		N/A		4,426		8.4	%
2000		6,136		58,607		6,394		6,283		N/A		6,675		7,074		N/A		6,677		11.4	%
2001		17,169		62,655		17,938		17,667		N/A		17,706		18,001		N/A		17,791		28.4	%
2002		3,505		36,530		3,668		3,624		N/A		3,585		3,600		N/A		3,603		9.9	%
2003		23,502		16,058		25,194		24,466		N/A		23,865		24,126		N/A		24,152		150.4	%
2004		2,090		27,270		2,122		2,197		N/A		2,165		2,074		N/A		2,145		7.9	%
2005		776		16,078		856		816		N/A		814		848		N/A		826		5.1	%
2006		359		14,332		364		381		503		390		387		2,952		386		2.7	%
2007		509		11,308		609		566		933		609		676		2,329		643		5.7	%
2008		357		10,786		501		470		1,218		734		861		2,222		798		7.4	%
2009		62		9,155		212		138		345		925		1,171		1,739		1,278		14.0	%
2010		8		6,403		134		39		393		1,117		1,259		1,217		1,198		18.7	%
Total		66,358		379,727		69,637		68,746				70,963		72,203				71,849		18.9	%

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
**	Projection Methods and Premium for the 2010 year reflect exposure as of September 30, 2010.

Milliman

WSC Assumed Business
Exhibit L16

WESTERN SURETY COMPANY — ASSUMED BUSINESS
NET COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE* ($000s)

											Unpaid
Accident	Ultimate		Paid		Incurred		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
10/97-12/97		383		375		375		0		8		8
1998		7,543		6,877		7,417		540		126		666
1999		4,426		4,043		4,093		50		333		383
2000		6,677		6,136		6,136		0		541		541
2001		17,791		17,100		17,169		69		622		691
2002		3,603		3,467		3,505		38		98		136
2003		24,152		23,502		23,502		0		650		650
2004		2,145		1,949		2,090		141		55		196
2005		826		768		776		8		50		58
2006		386		319		359		40		27		67
2007		643		503		509		6		134		140
2008		798		332		357		25		441		466
2009		1,278		62		62		0		1,216		1,216
2010		1,198		8		8		0		1,190		1,190
Total		71,849		65,441		66,358		917		5,491		6,408

* Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit M1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS CONTRACT SURETY*
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent***					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss**		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1997		13,024		12,921		0.992		0.8	%		104		12,921		13,025		13,025		12,886		139
1998		16,741		16,592		0.991		0.9	%		151		16,592		16,743		16,743		16,360		383
1999		30,758		30,453		0.990		1.0	%		308		30,453		30,761		30,761		30,273		488
2000		73,542		72,742		0.989		1.1	%		809		72,718		73,527		73,527		72,718		809
2001		54,759		54,056		0.987		1.2	%		657		54,056		54,713		54,713		52,534		2,179
2002		43,708		43,062		0.985		1.4	%		612		43,062		43,674		43,674		42,552		1,122
2003		63,955		62,824		0.982		1.7	%		1,087		62,902		63,989		63,989		61,064		2,925
2004		25,496		24,898		0.977		2.2	%		561		25,148		25,709		25,709		24,333		1,376
2005		9,632		9,297		0.965		3.2	%		308		9,297		9,605		9,605		2,807		6,798
2006		4,049		3,119		0.770		18.1	%		733		3,119		3,852		3,852		936		2,916
2007		9,644		443		0.046		85.9	%		8,284		995		9,279		9,462		881		8,581
2008		12,229		1,518		0.124		78.8	%		9,636		1,518		11,154		11,692		791		10,901
2009		20,300		6,164		0.304		62.7	%		12,728		7,965		20,693		20,300		5,915		14,385
2010		16,392		192		0.012		91.5	%		14,999		1,522		16,521		16,392		1,435		14,957
Total		394,229		338,281							50,977		342,268		393,245		393,444		325,485		67,959

*	Excludes Dick Corporation in 2005.
**	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.
***	2007 through 2009 years reflect judgmental adjustments to the percent unreported.

Milliman

WSC Assumed Business
Exhibit M2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS CONTRACT SURETY
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent**					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub*		Recovered		Recovery		Unrecovered			Projected		Recovered		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1997		4,532		4,443		0.980		1.8	%		82		4,443		4,525		4,525		82
1998		3,092		3,004		0.972		2.6	%		80		3,004		3,084		3,084		80
1999		8,458		8,192		0.969		3.1	%		262		8,192		8,454		8,454		262
2000		11,399		10,992		0.964		3.5	%		399		10,998		11,397		11,397		399
2001		10,568		9,800		0.927		6.3	%		666		9,800		10,466		10,466		666
2002		5,682		5,266		0.927		7.3	%		415		5,266		5,681		5,681		415
2003		12,215		10,775		0.882		10.7	%		1,307		11,394		12,701		12,701		1,307
2004		7,260		6,490		0.894		10.9	%		791		6,490		7,281		7,281		791
2005		961		551		0.573		34.6	%		333		551		884		884		333
2006		269		12		0.045		82.3	%		221		12		233		251		239
2007		925		18		0.019		97.4	%		901		18		919		922		904
2008		1,730		110		0.064		84.3	%		1,458		110		1,568		1,730		1,620
2009		6,187		2,885		0.466		48.0	%		2,970		2,990		5,960		6,187		3,197
2010		2,327		0		0.000		88.3	%		2,055		884		2,939		2,327		1,443
Total		75,605		62,538							11,940		64,152		76,092		75,890		11,738

*	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.
**	1997, 2008 and 2009 reflect judgmental adjustments to the percent unrecovered.

Milliman

WSC Assumed Business
Exhibit M3

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS CONTRACT SURETY* UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate		Paid Loss		Unpaid
	Loss, Gross		Salvage &		Loss, Net		Net of		Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1997		13,025		4,525		8,500		8,443		57
1998		16,743		3,084		13,659		13,356		303
1999		30,761		8,454		22,307		22,081		226
2000		73,527		11,397		62,130		61,720		410
2001		54,713		10,466		44,247		42,734		1,513
2002		43,674		5,681		37,993		37,286		707
2003		63,989		12,701		51,288		49,670		1,618
2004		25,709		7,281		18,428		17,843		585
2005		9,605		884		8,721		2,256		6,465
2006		3,852		251		3,601		924		2,677
2007		9,462		922		8,540		863		7,677
2008		11,692		1,730		9,962		681		9,281
2009		20,300		6,187		14,113		2,925		11,188
2010		16,392		2,327		14,065		551		13,514
Total		393,444		75,890		317,554		261,333		56,221

*	Excludes Dick Corporation in 2005.
Note:	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.

Milliman

WSC Assumed Business
Exhibit M4

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS CONTRACT SURETY
PAID ALAE B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid**			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1997		2,739		2,710		0.989		1.0	%		27		2,903		2,930		2,930		27
1998		3,850		3,758		0.976		2.1	%		81		3,758		3,839		3,839		81
1999		3,244		3,137		0.967		3.1	%		101		3,137		3,238		3,238		101
2000		10,058		9,692		0.964		3.6	%		362		9,694		10,056		10,056		362
2001		7,995		7,370		0.922		6.8	%		544		7,864		8,408		8,408		544
2002		2,594		2,264		0.873		11.5	%		298		2,283		2,581		2,581		298
2003		9,038		7,794		0.862		13.5	%		1,220		7,968		9,188		9,188		1,220
2004		2,621		2,090		0.797		18.6	%		488		2,090		2,578		2,578		488
2005		2,298		893		0.389		50.9	%		1,170		932		2,102		2,200		1,268
2006		688		204		0.297		68.0	%		468		207		675		682		475
2007		1,349		78		0.058		88.3	%		1,191		91		1,282		1,349		1,258
2008		2,548		174		0.068		83.9	%		2,138		226		2,364		2,548		2,322
2009		2,103		179		0.085		82.3	%		1,731		198		1,929		2,103		1,905
2010		2,819		30		0.011		97.1	%		2,737		44		2,781		2,819		2,775
Total		53,944		40,373							12,556		41,395		53,951		54,519		13,124

*	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.
**	1997, 2008 and 2009 reflect judgmental adjustments to the percent unpaid.

Milliman

WSC Assumed Business
Exhibit M5

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS CONTRACT SURETY*
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate						Paid		Unpaid		IBNR
	Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1997		N/A		N/A		2,770		N/A		N/A		2,723		47		12
1998		20,582		3,084		17,498		13,356		3,758		17,114		384		152
1999		33,999		8,454		25,545		22,081		3,137		25,218		327		147
2000		83,583		11,397		72,186		61,720		9,694		71,414		772		772
2001		63,121		10,466		52,655		42,734		7,864		50,598		2,057		535
2002		46,255		5,681		40,574		37,286		2,283		39,569		1,005		495
2003		73,177		12,701		60,476		49,670		7,968		57,638		2,838		1,000
2004		28,287		7,281		21,006		17,843		2,090		19,933		1,073		258
2005		11,805		884		10,921		2,256		932		3,188		7,733		1,243
2006		4,534		251		4,283		924		207		1,131		3,152		969
2007		10,811		922		9,889		863		91		954		8,935		8,821
2008		14,240		1,730		12,510		681		226		907		11,603		10,876
2009		22,403		6,187		16,216		2,925		198		3,123		13,093		11,043
2010		19,211		2,327		16,884		551		44		595		16,289		16,202
Total		432,008		71,365		363,413		252,890		38,492		294,105		69,308		52,525

*	Excludes Dick Corporation in 2005.
Note:	The 2010 year has been adjusted to a full year estimate. 1997 reflects exposure 10/1/1997 and subsequent. IBNR has been selected to be 3/12 of the estimate of the full year IBNR.

Milliman

WSC Assumed Business
Exhibit N1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS COMMERCIAL SURETY*
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss**		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1997		2,643		2,596		0.982		1.8	%		48		2,596		2,644		2,644		2,596		48
1998		7,962		7,806		0.980		1.9	%		151		7,806		7,957		7,957		7,266		691
1999		22,855		22,341		0.978		2.2	%		503		22,341		22,844		22,844		22,291		553
2000		25,225		24,562		0.974		2.5	%		631		24,562		25,193		25,193		24,562		631
2001		20,649		19,966		0.967		3.1	%		640		19,966		20,606		20,606		19,896		710
2002		2,337		2,261		0.967		3.3	%		77		2,183		2,260		2,260		2,158		102
2003		28,672		27,359		0.954		4.2	%		1,204		27,425		28,629		28,629		27,425		1,204
2004		2,328		2,207		0.948		5.0	%		116		2,457		2,573		2,573		2,316		257
2005		2,082		1,884		0.905		8.4	%		175		1,876		2,051		2,051		1,876		175
2006		1,117		801		0.717		23.6	%		264		801		1,065		1,091		761		330
2007		1,182		499		0.422		50.4	%		596		494		1,090		1,136		494		642
2008		1,731		337		0.195		74.8	%		1,295		337		1,632		1,682		312		1,370
2009		1,558		51		0.033		92.7	%		1,444		77		1,521		1,558		77		1,481
2010		1,830		7		0.004		98.9	%		1,810		33		1,843		1,830		33		1,797
Total		122,171		112,677							8,954		112,954		121,908		122,054		112,063		9,991

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
**	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.

Milliman

WSC Assumed Business
Exhibit N2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS COMMERCIAL SURETY
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent**					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub*		Recovered		Recovery		Unrecovered			Projected		Recovered***		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1997		365		358		0.981		1.7	%		6		359		365		365		6
1998		1,359		1,276		0.939		5.1	%		69		1,279		1,348		1,348		69
1999		7,668		7,433		0.969		2.8	%		215		7,433		7,648		7,648		215
2000		1,884		1,816		0.964		3.5	%		66		1,817		1,883		1,883		66
2001		6,588		6,256		0.950		4.7	%		310		6,257		6,567		6,567		310
2002		109		99		0.908		8.1	%		9		214		223		223		9
2003		3,150		2,703		0.858		12.9	%		406		2,703		3,109		3,109		406
2004		493		379		0.769		20.9	%		103		379		482		482		103
2005		1,390		1,270		0.914		12.3	%		171		1,270		1,441		1,441		171
2006		620		516		0.832		14.7	%		91		517		608		608		91
2007		185		35		0.189		65.0	%		120		35		155		185		150
2008		284		15		0.053		91.3	%		259		15		274		284		269
2009		283		6		0.021		97.1	%		275		11		286		283		272
2010		306		0		0.000		99.5	%		305		0		305		306		306
Total		24,684		22,162							2,405		22,289		24,694		24,732		2,443

*	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.
**	1997 and 1999 reflect judgmental adjustments to the percent unrecovered.
***	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.

Milliman

WSC Assumed Business
Exhibit N3

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS COMMERCIAL SURETY*
UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate		Paid Loss		Unpaid
	Loss, Gross		Salvage &		Loss, Net		Net of		Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1997		2,644		365		2,279		2,237		42
1998		7,957		1,348		6,609		5,987		622
1999		22,844		7,648		15,196		14,858		338
2000		25,193		1,883		23,310		22,745		565
2001		20,606		6,567		14,039		13,639		400
2002		2,260		223		2,037		1,944		93
2003		28,629		3,109		25,520		24,722		798
2004		2,573		482		2,091		1,937		154
2005		2,051		1,441		610		606		4
2006		1,091		608		483		244		239
2007		1,136		185		951		459		492
2008		1,682		284		1,398		297		1,101
2009		1,558		283		1,275		66		1,209
2010		1,830		306		1,524		33		1,491
Total		122,054		24,732		97,322		89,774		7,548

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
Note:	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.

Milliman

WSC Assumed Business
Exhibit N4

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS COMMERCIAL SURETY
PAID ALAE B-F PROJECTION
($000s)

								Interpolated									Selected
		Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident		ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year		@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
	1997		385		373		0.969		2.8	%		11		373		384		384		11
	1998		1,015		945		0.931		6.0	%		61		972		1,033		1,033		61
	1999		3,249		3,099		0.954		4.2	%		136		3,099		3,235		3,235		136
	2000		774		713		0.921		7.1	%		55		714		769		769		55
	2001		5,563		5,216		0.938		5.6	%		312		5,217		5,529		5,529		312
	2002		1,459		1,344		0.921		7.5	%		109		1,421		1,530		1,530		109
	2003		1,514		1,286		0.849		13.3	%		201		1,289		1,490		1,490		201
	2004		323		262		0.811		17.9	%		58		262		320		320		58
	2005		226		162		0.717		26.0	%		59		172		231		231		59
	2006		127		74		0.583		38.4	%		49		74		123		123		49
	2007		116		45		0.388		56.3	%		65		45		110		113		68
	2008		260		34		0.131		80.5	%		209		38		247		260		222
	2009		429		18		0.042		93.6	%		402		22		424		429		407
	2010		389		1		0.003		98.8	%		385		5		390		389		384
Total			15,829		13,572							2,112		13,703		15,815		15,835		2,132

*	The 2010 year has been adjusted to a full year estimate. 1997 also reflects a full year of exposure on this exhibit.
**	1997, 1999 and 2001 reflect judgmental adjustments to the percent unpaid.

Milliman

WSC Assumed Business
Exhibit N5

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS COMMERCIAL SURETY*
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

		Ultimate				Ultimate						Paid		Unpaid		IBNR
		Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
		ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident		of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
	1997		N/A		N/A		388		N/A		N/A		375		13		13
	1998		8,990		1,348		7,642		5,987		972		6,959		683		143
	1999		26,079		7,648		18,431		14,858		3,099		17,957		474		424
	2000		25,962		1,883		24,079		22,745		714		23,459		620		620
	2001		26,135		6,567		19,568		13,639		5,217		18,856		712		642
	2002		3,790		223		3,567		1,944		1,421		3,365		202		177
	2003		30,119		3,109		27,010		24,722		1,289		26,011		999		999
	2004		2,893		482		2,411		1,937		262		2,199		212		71
	2005		2,282		1,441		841		606		172		778		63		63
	2006		1,214		608		606		244		74		318		288		248
	2007		1,249		185		1,064		459		45		504		560		560
	2008		1,942		284		1,658		297		38		335		1,323		1,298
	2009		1,987		283		1,704		66		22		88		1,616		1,616
	2010		2,219		306		1,913		33		5		38		1,875		1,875
Total			134,861		24,367		110,882		87,537		13,330		101,242		9,640		8,749

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
Note:	The 2010 year has been adjusted to a full year estimate. 1997 reflects exposure 10/1/1997 and subsequent. IBNR has been selected to be 3/12 of the estimate of the full year IBNR.

Milliman

WSC Assumed Business
Exhibit O1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT SURETY
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1987 & Prior		153,822		153,668		0.999		0.1	%		154		153,668		153,822		153,822		152,557		1,265
1988		16,204		16,188		0.999		0.1	%		16		16,188		16,204		16,204		16,188		16
1989		19,499		19,480		0.999		0.1	%		19		19,480		19,499		19,499		18,804		695
1990		23,494		23,471		0.999		0.1	%		23		23,471		23,494		23,494		23,471		23
1991		35,678		35,607		0.998		0.2	%		71		35,607		35,678		35,678		35,607		71
1992		41,686		41,561		0.997		0.3	%		125		41,564		41,689		41,689		41,564		125
1993		71,346		71,062		0.996		0.4	%		285		71,062		71,347		71,347		71,062		285
1994		52,768		52,505		0.995		0.5	%		264		52,505		52,769		52,769		52,505		264
1995		18,393		18,283		0.994		0.6	%		105		18,283		18,388		18,388		18,283		105
1996		13,268		13,176		0.993		0.7	%		93		13,176		13,269		13,269		12,156		1,113
1/1-9/30/97		9,988		9,909		0.992		0.8	%		80		9,909		9,989		9,989		9,909		80
Total		456,146		454,910							1,235		454,913		456,148		456,148		452,106		4,042

Milliman

WSC Assumed Business
Exhibit O2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT SURETY
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub		Recovered		Recovery		Unrecovered			Projected		Recovered		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1987 & Prior		20,406		20,406		1.000		0.0	%		0		20,406		20,406		20,406		0
1988		2,438		2,436		0.999		0.1	%		2		2,436		2,438		2,438		2
1989		2,608		2,603		0.998		0.2	%		5		2,603		2,608		2,608		5
1990		5,193		5,177		0.997		0.3	%		16		5,177		5,193		5,193		16
1991		4,112		4,105		0.998		0.2	%		8		4,107		4,115		4,115		8
1992		15,683		15,605		0.995		0.4	%		63		15,605		15,668		15,668		63
1993		41,024		40,759		0.994		0.6	%		246		40,759		41,005		41,005		246
1994		17,941		17,800		0.992		0.8	%		144		17,800		17,944		17,944		144
1995		11,863		11,757		0.991		0.9	%		107		11,757		11,864		11,864		107
1996		2,928		2,896		0.989		1.0	%		29		2,896		2,925		2,925		29
1/1-9/30/97		3,795		3,736		0.984		1.4	%		53		3,736		3,789		3,789		53
Total		127,991		127,280							673		127,282		127,955		127,955		673

Milliman

WSC Assumed Business
Exhibit O3

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT SURETY
UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate		Paid Loss		Unpaid
	Loss, Gross		Salvage &		Loss, Net		Net of		Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1987 & Prior		153,822		20,406		133,416		132,151		1,265
1988		16,204		2,438		13,766		13,752		14
1989		19,499		2,608		16,891		16,201		690
1990		23,494		5,193		18,301		18,294		7
1991		35,678		4,115		31,563		31,500		63
1992		41,689		15,668		26,021		25,959		62
1993		71,347		41,005		30,342		30,303		39
1994		52,769		17,944		34,825		34,705		120
1995		18,388		11,864		6,524		6,526		(2	)
1996		13,269		2,925		10,344		9,260		1,084
1/1-9/30/97		9,989		3,789		6,200		6,173		27
Total		456,148		127,955		328,193		324,824		3,369

Milliman

WSC Assumed Business
Exhibit O4

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT SURETY
PAID ALAE B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1987 & Prior		18,220		18,220		1.000		0.0	%		0		18,220		18,220		18,220		0
1988		1,756		1,756		1.000		0.0	%		0		1,756		1,756		1,756		0
1989		2,807		2,807		1.000		0.0	%		0		2,807		2,807		2,807		0
1990		4,631		4,631		1.000		0.0	%		0		4,631		4,631		4,631		0
1991		4,872		4,872		1.000		0.0	%		0		4,872		4,872		4,872		0
1992		8,437		8,437		1.000		0.0	%		0		8,437		8,437		8,437		0
1993		7,520		7,512		0.999		0.1	%		8		7,512		7,520		7,520		8
1994		5,870		5,858		0.998		0.2	%		12		5,858		5,870		5,870		12
1995		3,004		2,992		0.996		0.4	%		11		2,992		3,003		3,003		11
1996		1,839		1,828		0.994		0.5	%		9		1,836		1,845		1,845		9
1/1-9/30/97		1,957		1,938		0.990		0.9	%		18		1,938		1,956		1,956		18
Total		60,913		60,851							58		60,859		60,917		60,917		58

Milliman

WSC Assumed Business
Exhibit O5

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT SURETY
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate						Paid		Unpaid		IBNR
	Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1987 & Prior		172,042		20,406		151,636		132,151		18,220		150,371		1,265		154
1988		17,960		2,438		15,522		13,752		1,756		15,508		14		14
1989		22,306		2,608		19,698		16,201		2,807		19,008		690		14
1990		28,125		5,193		22,932		18,294		4,631		22,925		7		7
1991		40,550		4,115		36,435		31,500		4,872		36,372		63		63
1992		50,126		15,668		34,458		25,959		8,437		34,396		62		62
1993		78,867		41,005		37,862		30,303		7,512		37,815		47		47
1994		58,639		17,944		40,695		34,705		5,858		40,563		132		132
1995		21,391		11,864		9,527		6,526		2,992		9,518		9		9
1996		15,114		2,925		12,189		9,260		1,836		11,096		1,093		73
1/1-9/30/97		11,945		3,789		8,156		6,173		1,938		8,111		45		45
Total		517,065		127,955		389,110		324,824		60,859		385,683		3,427		620

Milliman

WSC Assumed Business
Exhibit P1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET COMMERCIAL SURETY
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION
($000s)

							Interpolated									Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Indicated		Ultimate		Paid		Unpaid
Accident	Loss		Loss		Reporting		Unreported			Projected		Loss		Ultimate		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		Loss		@12/31/10		@12/31/10		@12/31/10
1987 & Prior		74,984		74,611		0.995		0.5	%		373		74,659		75,032		75,032		69,981		5,051
1988		4,116		4,096		0.995		0.5	%		21		4,096		4,117		4,117		4,096		21
1989		7,892		7,845		0.994		0.6	%		47		7,845		7,892		7,892		7,845		47
1990		12,024		11,940		0.993		0.7	%		84		11,940		12,024		12,024		11,939		85
1991		10,245		10,164		0.992		0.8	%		82		10,164		10,246		10,246		10,164		82
1992		3,602		3,570		0.991		0.9	%		32		3,570		3,602		3,602		3,570		32
1993		3,605		3,569		0.990		1.0	%		36		3,569		3,605		3,605		3,569		36
1994		3,060		3,024		0.988		1.1	%		34		3,024		3,058		3,058		3,024		34
1995		2,787		2,749		0.986		1.3	%		36		2,749		2,785		2,785		2,749		36
1996		6,465		6,363		0.984		1.5	%		97		6,363		6,460		6,460		6,363		97
1/1-9/30/97		2,241		2,201		0.982		1.7	%		38		2,201		2,239		2,239		2,201		38
Total		131,021		130,132							880		130,180		131,060		131,060		125,501		5,559

Milliman

WSC Assumed Business
Exhibit P2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET SURETY COMMERCIAL SURETY
SALVAGE & SUBROGATION B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Sal/Sub		Implicit		Percent					Sal/Sub		Indicated		Ultimate		Sal/Sub
Accident	Sal/Sub		Recovered		Recovery		Unrecovered			Projected		Recovered		Ultimate		Sal/Sub		Recoverable
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Recoverable		@12/31/10		Sal/Sub		@12/31/10		@12/31/10
1987 & Prior		14,728		14,713		0.999		0.1	%		15		14,732		14,747		14,747		15
1988		672		670		0.997		0.2	%		1		670		671		671		1
1989		2,326		2,317		0.996		0.4	%		9		2,317		2,326		2,326		9
1990		2,140		2,130		0.995		0.4	%		9		2,130		2,139		2,139		9
1991		1,125		1,116		0.992		0.7	%		8		1,116		1,124		1,124		8
1992		658		652		0.991		0.9	%		6		652		658		658		6
1993		1,156		1,146		0.991		0.9	%		10		1,146		1,156		1,156		10
1994		664		656		0.988		1.1	%		7		656		663		663		7
1995		557		551		0.989		1.1	%		6		551		557		557		6
1996		2,860		2,818		0.985		1.4	%		40		2,819		2,859		2,859		40
1/1-9/30/97		309		303		0.981		1.8	%		6		304		310		310		6
Total		27,195		27,072							117		27,093		27,210		27,210		117

Milliman

WSC Assumed Business
Exhibit P3

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET COMMERCIAL SURETY
UNPAID LOSS
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Ultimate		Ultimate		Paid Loss		Unpaid
	Loss, Gross		Salvage &		Loss, Net		Net of		Loss, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1987 & Prior		75,032		14,747		60,285		55,249		5,036
1988		4,117		671		3,446		3,426		20
1989		7,892		2,326		5,566		5,528		38
1990		12,024		2,139		9,885		9,809		76
1991		10,246		1,124		9,122		9,048		74
1992		3,602		658		2,944		2,918		26
1993		3,605		1,156		2,449		2,423		26
1994		3,058		663		2,395		2,368		27
1995		2,785		557		2,228		2,198		30
1996		6,460		2,859		3,601		3,544		57
1/1-9/30/97		2,239		310		1,929		1,897		32
Total		131,060		27,210		103,850		98,408		5,442

Milliman

WSC Assumed Business
Exhibit P4

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET COMMERCIAL SURETY
PAID ALAE B-F PROJECTION
($000s)

							Interpolated									Selected
	Ultimate		Paid		Implicit		Percent					Paid		Indicated		Ultimate		Unpaid
Accident	ALAE		ALAE		Payment		Unpaid			Projected		ALAE		Ultimate		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		ALAE		@12/31/10		@12/31/10
1987 & Prior		8,608		8,565		0.995		0.5	%		43		8,569		8,612		8,612		43
1988		1,037		1,031		0.994		0.6	%		6		1,031		1,037		1,037		6
1989		1,360		1,353		0.995		0.5	%		7		1,353		1,360		1,360		7
1990		1,868		1,856		0.994		0.6	%		11		1,856		1,867		1,867		11
1991		1,002		991		0.989		1.0	%		10		991		1,001		1,001		10
1992		559		553		0.989		1.1	%		6		553		559		559		6
1993		625		617		0.987		1.2	%		8		617		625		625		8
1994		502		495		0.986		1.4	%		7		496		503		503		7
1995		305		300		0.984		1.6	%		5		301		306		306		5
1996		490		480		0.980		1.9	%		9		482		491		491		9
1/1-9/30/97		262		255		0.973		2.5	%		7		255		262		262		7
Total		16,618		16,496							119		16,504		16,623		16,623		119

Milliman

WSC Assumed Business
Exhibit P5

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET COMMERCIAL SURETY
UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate				Ultimate						Paid		Unpaid		IBNR
	Loss &		Ultimate		Loss &		Paid Loss				Loss &		Loss &		Loss &
	ALAE, Gross		Salvage &		ALAE, Net		Net of				ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		Subrogation		of Sal/Sub		Sal/Sub		Paid ALAE		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1987 & Prior		83,644		14,747		68,897		55,249		8,569		63,818		5,079		401
1988		5,154		671		4,483		3,426		1,031		4,457		26		26
1989		9,252		2,326		6,926		5,528		1,353		6,881		45		45
1990		13,891		2,139		11,752		9,809		1,856		11,665		87		86
1991		11,247		1,124		10,123		9,048		991		10,039		84		84
1992		4,161		658		3,503		2,918		553		3,471		32		32
1993		4,230		1,156		3,074		2,423		617		3,040		34		34
1994		3,561		663		2,898		2,368		496		2,864		34		34
1995		3,091		557		2,534		2,198		301		2,499		35		35
1996		6,951		2,859		4,092		3,544		482		4,026		66		66
1/1-9/30/97		2,501		310		2,191		1,897		255		2,152		39		39
Total		147,683		27,210		120,473		98,408		16,504		114,912		5,561		882

Milliman

WSC Assumed Business
Exhibit Q1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT & COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
TOTAL UNPAID CLAIM LIABILITIES FOR THE LOSS PORTFOLIO TRANSFER
EVALUATED AS OF DECEMBER 31, 2010

					(3)
	(1)		(2)		(1)+(2)
	Contract		Commercial		Total
Accident	Net Unpaid		Net Unpaid		Net Unpaid
Year	Loss & ALAE*		Loss & ALAE**		Loss & ALAE
1987 & Prior		1,265		5,079		6,344
1988		14		26		40
1989		690		45		735
1990		7		87		94
1991		63		84		147
1992		62		32		94
1993		47		34		81
1994		132		34		166
1995		9		35		44
1996		1,093		66		1,159
1/1-9/30/97		45		39		84
Total		3,427		5,561		8,988

*	See Exhibit O5
**	See Exhibit P5

Milliman

WSC Assumed Business
Exhibit R1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT SURETY*
INCURRED LOSS & ALAE B-F PROJECTION**
NET OF SALVAGE & SUBROGATION
($000s)

																Selected
	Ultimate		Incurred				Interpolated					Incurred		Indicated		Ultimate		Paid		Unpaid
	Loss &		Loss &		Implicit		Percent****					Loss &		Ultimate		Loss &		Loss &		Loss &
Accident	ALAE***		ALAE		Reporting		Unreported			Projected		ALAE		Loss &		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		ALAE		@12/31/10		@12/31/10		@12/31/10
10/1-12/31/97		1,962		1,962		1.000		0.0	%		0		2,121		2,121		2,121		2,119		2
1998		13,674		13,658		0.999		0.1	%		14		13,658		13,672		13,672		13,466		206
1999		23,865		23,816		0.998		0.2	%		48		23,816		23,864		23,864		23,636		228
2000		45,580		45,411		0.996		0.3	%		137		45,384		45,521		45,521		45,384		137
2001		50,361		50,165		0.996		0.4	%		201		50,659		50,860		50,860		49,137		1,723
2002		38,986		38,768		0.994		0.5	%		195		38,523		38,718		38,718		38,013		705
2003		53,204		52,752		0.992		0.8	%		426		52,433		52,859		52,859		51,220		1,639
2004		13,527		13,340		0.986		1.2	%		162		13,590		13,752		13,752		12,949		803
2005		5,120		4,977		0.972		2.4	%		123		5,043		5,166		5,166		2,135		3,031
2006		3,464		3,311		0.956		4.0	%		139		3,314		3,453		3,453		1,130		2,323
2007		6,801		248		0.036		86.7	%		5,896		938		6,834		6,818		955		5,863
2008		9,242		1,581		0.171		74.6	%		6,895		1,634		8,529		8,886		908		7,978
2009		14,238		3,459		0.243		68.1	%		9,696		5,156		14,852		14,238		3,123		11,115
2010		14,555		221		0.015		92.8	%		13,507		681		14,188		14,555		595		13,960
Total		294,579		253,669							37,439		256,950		294,389		294,483		244,770		49,713

*	Excludes Dick Corporation in 2005.
**	Gross of Aggregate Stop Loss Reinsurance.
***	The 2010 year has been adjusted to a full year estimate.
****	2007 through 2009 years reflect judgmental adjustments to the percent unreported.

Milliman

WSC Assumed Business
Exhibit R2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT SURETY*
UNPAID LOSS & ALAE**
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Paid		Unpaid		IBNR
	Loss &		Loss &		Loss &		Loss &
	ALAE, Net		ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10
10/1-12/31/97		2,121		2,119		2		0
1998		13,672		13,466		206		14
1999		23,864		23,636		228		48
2000		45,521		45,384		137		137
2001		50,860		49,137		1,723		201
2002		38,718		38,013		705		195
2003		52,859		51,220		1,639		426
2004		13,752		12,949		803		162
2005		5,166		2,135		3,031		123
2006		3,453		1,130		2,323		139
2007		6,818		955		5,863		5,880
2008		8,886		908		7,978		7,252
2009		14,238		3,123		11,115		9,082
2010		14,555		595		13,960		13,874
Total		294,483		244,770		49,713		37,533

*	Excludes Dick Corporation in 2005.
**	Gross of Aggregate Stop Loss Reinsurance.

Milliman

WSC Assumed Business
Exhibit S1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET COMMERCIAL SURETY*
INCURRED LOSS & ALAE B-F PROJECTION**
NET OF SALVAGE & SUBROGATION
($000s)

																Selected
	Ultimate		Incurred				Interpolated					Incurred		Indicated		Ultimate		Paid		Unpaid
	Loss &		Loss &		Implicit		Percent****					Loss &		Ultimate		Loss &		Loss &		Loss &
Accident	ALAE***		ALAE		Reporting		Unreported			Projected		ALAE		Loss &		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			IBNR		@12/31/10		ALAE		@12/31/10		@12/31/10		@12/31/10
10/1-12/31/97		383		375		0.979		2.1	%		8		375		383		383		375		8
1998		7,543		7,417		0.983		1.8	%		136		7,442		7,578		7,578		6,902		676
1999		4,426		4,093		0.925		6.1	%		270		4,093		4,363		4,363		4,043		320
2000		6,677		6,136		0.919		8.0	%		534		6,135		6,669		6,669		6,135		534
2001		17,791		17,169		0.965		3.1	%		552		17,170		17,722		17,722		17,101		621
2002		3,603		3,505		0.973		2.4	%		86		3,391		3,477		3,477		3,365		112
2003		24,152		23,502		0.973		2.7	%		652		23,572		24,224		24,224		23,571		653
2004		2,145		2,090		0.974		2.6	%		56		2,340		2,396		2,396		2,199		197
2005		826		776		0.939		5.2	%		43		778		821		821		778		43
2006		386		359		0.930		6.8	%		26		358		384		385		318		67
2007		643		509		0.792		17.4	%		112		503		615		629		503		126
2008		798		357		0.447		46.7	%		373		360		733		766		334		432
2009		1,278		62		0.049		85.2	%		1,089		88		1,177		1,278		88		1,190
2010		1,619		8		0.005		98.4	%		1,593		38		1,631		1,619		38		1,581
Total		72,270		66,358							5,530		66,643		72,173		72,310		65,750		6,560

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
**	Gross of Aggregate Stop Loss Reinsurance.
***	The 2010 year has been adjusted to a full year estimate.
****	2001 and 2002 reflect judgmental adjustments to the percent unreported.

Milliman

WSC Assumed Business
Exhibit S2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET COMMERCIAL SURETY*
UNPAID LOSS & ALAE**
NET OF SALVAGE & SUBROGATION
($000s)

	Ultimate		Paid		Unpaid		IBNR
	Loss &		Loss &		Loss &		Loss &
	ALAE, Net		ALAE, Net		ALAE, Net		ALAE, Net
Accident	of Sal/Sub		of Sal/Sub		of Sal/Sub		of Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10
10/1-12/31/97		383		375		8		8
1998		7,578		6,902		676		136
1999		4,363		4,043		320		270
2000		6,669		6,135		534		534
2001		17,722		17,101		621		552
2002		3,477		3,365		112		86
2003		24,224		23,571		653		652
2004		2,396		2,199		197		56
2005		821		778		43		43
2006		385		318		67		27
2007		629		503		126		126
2008		766		334		432		406
2009		1,278		88		1,190		1,190
2010		1,619		38		1,581		1,581
Total		72,310		65,750		6,560		5,667

*	Excludes Superior National in 1999, Enron in 2001, Consolidated Freightways in 2002 and Delphi in 2009.
**	Gross of Aggregate Stop Loss Reinsurance.

Milliman

WSC Assumed Business
Exhibit T1

WESTERN SURETY COMPANY

Direct & Assumed Calendar Year Payments
Schedule P — Part 1 — Summary

						(3)				(5)
						= (1) + (2)				= (4) / (3)
	(1)			(2)		Total		(4)		Paid ULAE
Calendar	Paid			Paid		Paid Loss		Paid		to Paid Loss
Year	Loss			ALAE		& ALAE		ULAE		& ALAE
2000		63,687			5,188		68,875		5,241		7.6	%
2001		78,611			6,686		85,297		5,363		6.3	%
2002		63,567			13,657		77,224		6,281		8.1	%
2003		126,168			11,343		137,511		7,079		5.1	%
2004		95,849			9,530		105,379		7,031		6.7	%
2005		97,534			9,232		106,766		7,396		6.9	%
2006		67,012			10,412		77,424		7,940		10.3	%
2007		62,983			10,039		73,022		6,954		9.5	%
2008		63,556	*		10,374		73,930		5,556		7.5	%
2009		79,897			10,936		90,833		6,137		6.8	%
Total		798,864			97,397		896,261		64,978		7.2	%
Weighted Avg 07-09											7.8	%
Weighted Avg 06-09											8.4	%
Weighted Avg 05-09											8.1	%
(6) Selected ULAE-to-Loss & ALAE Ratio											8.5	%

* Excludes the Superior National payment of $56.25M.

Milliman

WSC Assumed Business
Exhibit T2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

NET CONTRACT & COMMERCIAL SURETY
NET OF SALVAGE & SUBROGATION
DEVELOPMENT OF UNPAID ULAE ($000s)
EVALUATED AS OF DECEMBER 31, 2010

								(4)						(7)
	(1)					(3)		Selected				(6)		Selected
	Paid			(2)		Milliman		Contract		(5)		Milliman		Commercial
	ULAE to			Contract		Contract		Unpaid		Commercial		Commercial		Unpaid
Accident	Paid Loss			Net Case		Estimated		ULAE**		Net Case		Estimated		ULAE****
Year	& ALAE			Reserves		Net IBNR*		@12/31/10		Reserves		Net IBNR***		@12/31/10
1987 & Prior		8.5	%		1,111		154		60		4,678		401		233
1988		8.5	%		0		14		1		0		26		2
1989		8.5	%		676		14		30		0		45		4
1990		8.5	%		0		7		1		1		86		7
1991		8.5	%		0		63		5		0		84		7
1992		8.5	%		0		62		5		0		32		3
1993		8.5	%		0		47		4		0		34		3
1994		8.5	%		0		132		11		0		34		3
1995		8.5	%		0		9		1		0		35		3
1996		8.5	%		1,020		73		50		0		66		6
1/1-9/30/97		8.5	%		0		45		4		0		39		3
Total					2,807		620		172		4,679		882		274

*	See Exhibit O5
**	(4) = (1) x (2) x 0.5 + (1) x (3)
***	See Exhibit P5
****	(7) = (1) x (5) x 0.5 + (1) x (6)

Milliman

WSC Assumed Business
Exhibit T3

WESTERN SURETY COMPANY — ASSUMED BUSINESS

GROSS CONTRACT & COMMERCIAL SURETY*
NET OF SALVAGE & SUBROGATION
DEVELOPMENT OF UNPAID ULAE ($000s)
EVALUATED AS OF DECEMBER 31, 2010

								(4)						(7)
	(1)			(2)		(3)		= (2) + (3)		(5)		(6)		= (5) + (6)		(8)		(9)		(10)
	Paid			Contract		Commercial		Total		Milliman		Milliman		Milliman		Selected				= (8) + (9)
	ULAE to			Gross		Gross		Gross		Contract		Commercial		Total		Unpaid		Paid		Ultimate
Accident	Paid Loss			Case		Case		Case		Estimated		Estimated		Estimated		ULAE****		ULAE		ULAE
Year	& ALAE			Reserves		Reserves		Reserves		Gross IBNR**		Gross IBNR***		Gross IBNR		@12/31/10		@12/31/10		@12/31/10
10/1-12/31/97		8.5	%		35		0		35		12		13		26		4		446		450
1998		8.5	%		232		540		772		152		143		295		58		3,044		3,102
1999		8.5	%		180		50		230		147		424		571		58		4,379		4,437
2000		8.5	%		0		0		0		772		620		1,392		118		4,172		4,290
2001		8.5	%		1,522		70		1,592		535		642		1,177		168		5,506		5,674
2002		8.5	%		510		25		535		495		177		672		80		4,857		4,937
2003		8.5	%		1,838		0		1,838		1,000		999		1,999		248		4,547		4,795
2004		8.5	%		815		141		956		258		71		329		69		3,433		3,502
2005		8.5	%		6,490		0		6,490		1,243		63		1,306		387		3,049		3,436
2006		8.5	%		2,183		40		2,223		969		248		1,217		198		2,523		2,721
2007		8.5	%		114		0		114		8,821		560		9,381		802		2,657		3,459
2008		8.5	%		727		25		752		10,876		1,298		12,174		1,067		2,369		3,436
2009		8.5	%		2,050		0		2,050		11,043		1,616		12,659		1,163		2,551		3,714
2010		8.5	%		87		0		87		16,202		1,875		18,077		1,540		1,876		3,416
Total					16,783		891		17,674		52,525		8,749		61,275		5,960		45,409		51,369

*	Excludes Superior National in the Commercial 1999 year, Enron in the Commercial 2001 year, Consolidated Freightways in the Commercial 2002 year, Dick Corp in the Contract 2005 year and Delphi in the Commercial 2009 year.
**	See Exhibit M5
***	See Exhibit N5
****	(8) = (1) x (4) x 0.5 + (1) x (7)

Milliman

WSC Assumed Business
Exhibit U1

WESTERN SURETY COMPANY — ASSUMED BUSINESS

IMPACT OF CNA STOP LOSS RATIO TREATY
AS OF DECEMBER 31, 2010
($000s)

																			Milliman									Aggregate
																	Milliman		Projected			Aggregate						Stop Loss		Milliman
															Milliman		Projected		Ultimate			Stop			Ceded			Ceded		Projected
									Milliman Projected						Projected		Ultimate		Net Loss			Loss &			Loss &			Ultimate		Ultimate
Accident3	Net Earned Premium								Net Ultimate Loss & ALAE1						Ultimate		Net Loss		& LAE1			LAE			LAE			Loss &		Net Loss
Year	Contract		Commercial		International		Total		Contract		Commercial		International		ULAE		& LAE1		Ratio			Ratio			Ratio			LAE		& LAE4
19972		25,344		12,788		10,123		48,255		2,121		383		8,507		450		11,461		23.8	%		24.0	%		0.0	%		0		11,461
1998		105,330		44,907		10,000		160,237		13,672		7,578		6,241		3,102		30,593		19.1	%		24.0	%		0.0	%		0		30,593
99 x SN		118,084		52,850		11,250		182,184		23,864		4,363		5,691		4,437		38,355		N/A			N/A			N/A			N/A		N/A
Sup Nat		N/A		N/A		N/A		N/A		0		33,475		0		N/A		33,475		N/A			N/A			N/A			N/A		N/A
1999		118,084		52,850		11,250		182,184		23,864		37,838		5,691		4,437		71,830		39.4	%		24.0	%		15.4	%		28,106		43,724
2000		123,949		58,607		6,120		188,676		45,521		6,669		6,592		4,290		63,072		33.4	%		24.0	%		9.4	%		17,790		45,282
Total		372,707		169,152		37,493		579,352		85,178		52,468		27,031		12,279		176,956											45,896		131,060

1	Prior to Stop Loss Treaty, Net of XOL, Net of Salvage and Subrogation.
2	10/1/97 — 12/31/97
3	The International Business is on an Underwriting Year basis and has been commuted. The Ultimate Loss and ALAE reflect CNA Surety’s allocation of the commutation value to Underwriting Year.
4	Net of all Reinsurance.

Milliman

WSC Assumed Business
Exhibit U2

WESTERN SURETY COMPANY — ASSUMED BUSINESS

IMPACT OF CNA STOP LOSS RATIO TREATY
AS OF DECEMBER 31, 2010
($000s)

	Payments Gross of Stop Loss1								Unpaid Loss & LAE Gross of Stop Loss4										Unpaid Loss & LAE Net of Stop Loss5
Accident3	Loss & ALAE								Loss & ALAE								Total		Loss & ALAE								Total		Effect of Stop Loss on Unpaid Loss & LAE6
Year	Contract		Commercial		International		ULAE		Contract		Commercial		International		ULAE		Loss & LAE		Contract		Commercial		International		ULAE		Loss & LAE		Loss & ALAE		ULAE		Loss & LAE
19972		2,119		375		8,507		446		2		8		0		4		14		2		8		0		4		14		0		0		0
1998		13,466		6,902		6,241		3,044		206		676		0		58		940		206		676		0		58		940		0		0		0
99 x SN		23,636		4,043		5,691		4,379		228		320		0		58		606		0		0		0		0		0		548		58		606
Sup Nat		0		33,475		0		N/A		0		0		0		N/A		0		0		0		0		N/A		0		0		0		0
1999		23,636		37,518		5,691		4,379		228		320		0		58		606		0		0		0		0		0		548		58		606
2000		45,384		6,135		6,592		4,172		137		534		0		118		789		0		0		0		0		0		671		118		789
Total		84,605		50,930		27,031		12,041		573		1,538		0		238		2,349		208		684		0		62		954		1,219		176		1,395

1	Prior to Stop Loss Treaty, Net of XOL, Net of Salvage and Subrogation.
2	10/1/97 — 12/31/97
3	The International Business is on an Underwriting Year basis and has been commuted. The Ultimate Loss and ALAE reflect CNA Surety’s allocation of the commutation value to Underwriting Year.
4	Ultimate Projections Gross of Stop Loss from prior Exhibit less payments Gross of Stop Loss (and Net of XOL and Salvage and Subrogation).
5	Net of all Reinsurance; equal to Unpaid Gross of Stop Loss for years with no projected cessions and equal to zero for years where payments Gross of Stop Loss exceeded Projected Ultimates Net of Stop Loss.
6	Unpaid Loss & LAE Gross of Stop Loss less Unpaid Loss & LAE Net of Stop Loss.

Milliman

SURETY BONDING COMPANY OF AMERICA

Milliman

SBCA
Exhibit A1

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192
1995		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1996		0		25,000		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018
1997		50,000		57,819		57,819		58,745		58,745		58,745		58,745		58,745		58,745		58,745		58,745		58,745		58,745		58,745
1998		10,000		10,930		25,960		34,610		34,610		63,149		63,149		63,149		63,149		63,149		63,149		63,149		63,149
1999		14,576		58,338		90,063		118,786		144,976		238,234		246,094		281,094		281,094		281,094		281,094		281,094
2000		10,530		59,867		201,366		246,691		320,691		335,691		363,191		363,191		378,191		378,191		378,191
2001		12,964		20,071		39,399		45,581		45,581		45,581		45,581		58,581		58,581		58,581
2002		6,316		96,361		171,241		236,271		261,271		292,216		291,271		308,271		308,271
2003		0		218,598		339,183		354,183		371,183		400,683		420,713		430,713
2004		48,863		97,047		136,942		262,062		309,812		339,812		423,852
2005		52,500		168,759		363,059		522,805		642,305		727,505
2006		23,756		198,699		464,329		666,099		782,676
2007		90,853		577,378		798,159		942,274
2008		157,710		387,532		473,847
2009		10,819		148,077
2010		5,903

* Last Diagonal is as of 9/30/10.

Accident	Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		1.241		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.156		1.000		1.016		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		1.093		2.375		1.333		1.000		1.825		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1999		4.002		1.544		1.319		1.220		1.643		1.033		1.142		1.000		1.000		1.000		1.000
2000		5.685		3.364		1.225		1.300		1.047		1.082		1.000		1.041		1.000		1.000
2001		1.548		1.963		1.157		1.000		1.000		1.000		1.285		1.000		1.000
2002		15.257		1.777		1.380		1.106		1.118		0.997		1.058		1.000
2003		N/A		1.552		1.044		1.048		1.079		1.050		1.032
2004		1.986		1.411		1.914		1.182		1.097		1.343
2005		3.214		2.151		1.440		1.229		1.181
2006		8.364		2.337		1.435		1.240
2007		6.355		1.382		1.248
2008		2.457		1.307
2009		32.739
**     Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		6.988		1.800		1.293		1.120		1.199		1.056		1.065		1.006		1.000		1.000		1.000		1.000		1.000		1.000
Average x H/L		5.003		1.731		1.260		1.114		1.146		1.024		1.039		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		5.978		1.648		1.374		1.172		1.098		1.044		1.077		1.000		1.000		1.000
Wtd Average		4.767		1.632		1.314		1.182		1.155		1.095		1.052		1.013		1.000		1.000		1.000		1.000		1.000		1.000
Wtd Avg L5		5.025		1.587		1.333		1.181		1.127		1.115		1.057		1.014		1.000		1.000
WSC Selected		4.327		1.498		1.215		1.095		1.040		1.039		1.037		1.016		1.016		1.005		1.004		1.008		1.007		1.005		1.003		1.006
Selected		4.327		1.587		1.333		1.181		1.127		1.056		1.037		1.016		1.008		1.004		1.002		1.001		1.001		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		13.838		3.198		2.015		1.512		1.280		1.136		1.076		1.038		1.022		1.014		1.010		1.008		1.007		1.006		1.006		1.006
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		22.745		4.612		2.262		1.625		1.334		1.170		1.091		1.047		1.026		1.016		1.011		1.009		1.007		1.006		1.006		1.006

Milliman

SBCA
Exhibit A2

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

							Cumulative												Indicated
Accident	Paid Losses						Development Factors						Indicated Ultimate Losses						Ultimate
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1995		0		0		0		1.006		1.006		1.006		0		0		0		0
1996		31,018		31,018		31,018		1.007		1.006		1.006		31,235		31,204		31,204		31,204
1997		58,745		58,745		58,745		1.008		1.007		1.006		59,215		59,156		59,097		59,097
1998		63,149		63,149		63,149		1.010		1.008		1.007		63,780		63,654		63,591		63,591
1999		281,094		281,094		281,094		1.014		1.010		1.009		285,029		283,905		283,624		283,624
2000		378,191		378,191		378,191		1.022		1.014		1.011		386,511		383,486		382,351		382,351
2001		58,581		58,581		58,581		1.038		1.022		1.016		60,807		59,870		59,518		59,518
2002		291,271		308,271		308,271		1.076		1.038		1.026		313,408		319,985		316,286		316,286
2003		400,683		420,713		430,713		1.136		1.076		1.047		455,176		452,687		450,957		450,957
2004		309,812		339,812		423,852		1.280		1.136		1.091		396,559		386,026		462,423		462,423
2005		522,805		642,305		727,505		1.512		1.280		1.170		790,481		822,150		851,181		851,181
2006		464,329		666,099		782,676		2.015		1.512		1.334		935,623		1,007,142		1,044,090		1,044,090
2007		577,378		798,159		942,274		3.198		2.015		1.625		1,846,455		1,608,290		1,531,195		1,531,195
2008		157,710		387,532		473,847		13.838		3.198		2.262		2,182,391		1,239,327		1,071,842		1,071,842
2009				10,819		148,077				13.838		4.612				149,713		682,931		682,931
2010						5,903						22.745						134,264		100,698

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

SBCA
Exhibit A3

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Incurred Losses*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192
1995		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1996		0		34,500		31,018		56,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018		31,018
1997		85,000		57,819		57,819		58,745		58,745		58,745		58,745		58,745		58,745		58,745		61,746		58,745		58,745		58,745
1998		22,703		80,930		126,960		34,610		34,613		63,149		63,149		63,151		63,150		63,150		63,150		63,149		63,149
1999		91,178		126,034		113,688		173,296		184,483		246,095		261,100		281,099		281,097		281,097		281,094		281,094
2000		38,500		170,976		263,678		299,004		324,500		350,699		363,197		363,193		378,192		378,193		378,192
2001		36,438		51,707		70,915		60,586		60,585		60,589		55,586		58,589		58,582		58,582
2002		6,334		105,607		181,268		239,308		291,292		321,284		316,281		308,274		308,274
2003		17		272,066		362,219		369,215		401,207		415,705		435,720		430,719
2004		74,097		97,084		167,007		294,496		344,104		383,830		457,865
2005		141,430		297,347		440,144		587,892		678,349		757,535
2006		57,277		228,742		556,873		738,632		790,207
2007		154,056		663,936		881,790		967,308
2008		203,029		435,146		513,880
2009		107,064		200,446
2010		37,063

* Last Diagonal is as of 9/30/10.

Accident	Incurred Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		0.899		1.806		0.554		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		0.680		1.000		1.016		1.000		1.000		1.000		1.000		1.000		1.000		1.051		0.951		1.000		1.000
1998		3.565		1.569		0.273		1.000		1.824		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1999		1.382		0.902		1.524		1.065		1.334		1.061		1.077		1.000		1.000		1.000		1.000
2000		4.441		1.542		1.134		1.085		1.081		1.036		1.000		1.041		1.000		1.000
2001		1.419		1.371		0.854		1.000		1.000		0.917		1.054		1.000		1.000
2002		16.673		1.716		1.320		1.217		1.103		0.984		0.975		1.000
2003		N/A		1.331		1.019		1.087		1.036		1.048		0.985
2004		1.310		1.720		1.763		1.168		1.115		1.265
2005		2.102		1.480		1.336		1.154		1.159
2006		3.994		2.435		1.326		1.094
2007		4.310		1.328		1.131
2008		2.143		1.248
2009		2.307
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		3.694		1.426		1.209		1.039		1.165		1.035		1.011		1.006		1.000		1.010		0.988		1.000		1.000		1.000
Average x H/L		2.697		1.383		1.242		1.073		1.103		1.018		1.006		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		2.815		1.510		1.264		1.139		1.085		1.023		1.013		1.000		1.000		1.000
Wtd Average		2.821		1.448		1.202		1.105		1.128		1.072		1.005		1.013		1.000		1.004		0.993		1.000		1.000		1.000
Wtd Avg L5		2.824		1.503		1.241		1.132		1.108		1.081		1.006		1.014		1.000		1.004
WSC Selected		2.053		1.265		1.107		1.053		1.034		1.019		1.012		1.008		1.009		1.002		1.002		1.003		1.004		1.002		1.002		1.003
Selected		2.824		1.503		1.241		1.132		1.108		1.035		1.012		1.008		1.009		1.002		1.002		1.001		1.001		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		7.097		2.513		1.672		1.347		1.190		1.074		1.038		1.026		1.018		1.009		1.007		1.005		1.004		1.003		1.003		1.003
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		10.805		3.258		1.851		1.422		1.227		1.102		1.047		1.029		1.020		1.011		1.008		1.006		1.004		1.003		1.003		1.003

Milliman

SBCA
Exhibit A4

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

							Cumulative												Indicated
Accident	Incurred Losses						Development Factors						Indicated Ultimate Losses						Ultimate
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1995		0		0		0		1.003		1.003		1.003		0		0		0		0
1996		31,018		31,018		31,018		1.004		1.003		1.003		31,142		31,111		31,111		31,111
1997		58,745		58,745		58,745		1.005		1.004		1.003		59,039		58,980		58,921		58,921
1998		63,150		63,149		63,149		1.007		1.005		1.004		63,592		63,465		63,402		63,402
1999		281,097		281,094		281,094		1.009		1.007		1.006		283,627		283,062		282,781		282,781
2000		378,192		378,193		378,192		1.018		1.009		1.008		384,999		381,597		381,218		381,218
2001		58,589		58,582		58,582		1.026		1.018		1.011		60,112		59,636		59,226		59,226
2002		316,281		308,274		308,274		1.038		1.026		1.020		328,300		316,289		314,439		314,439
2003		415,705		435,720		430,719		1.074		1.038		1.029		446,467		452,277		443,210		443,210
2004		344,104		383,830		457,865		1.190		1.074		1.047		409,484		412,233		479,385		479,385
2005		587,892		678,349		757,535		1.347		1.190		1.102		791,891		807,235		834,804		834,804
2006		556,873		738,632		790,207		1.672		1.347		1.227		931,092		994,937		969,584		969,584
2007		663,936		881,790		967,308		2.513		1.672		1.422		1,668,471		1,474,353		1,375,512		1,375,512
2008		203,029		435,146		513,880		7.097		2.513		1.851		1,440,897		1,093,522		951,192		951,192
2009				107,064		200,446				7.097		3.258				759,833		653,053		653,053
2010						37,063						10.805						400,466		300,350

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

SBCA
Exhibit A5

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Loss Ratio Projection

	Selected		Gross		Ultimate			Gross		Loss Ratio
Accident	Ultimate Losses		Earned Premium		Loss Ratios			Earned Premium		Projection
Year	@12/31/09		@12/31/09		@12/31/09			@9/30/10		@9/30/10
1995		0		169,413		0.0	%		169,413		0
1996		31,018		145,052		21.4	%		145,052		31,018
1997		58,745		241,855		24.3	%		241,855		58,745
1998		63,149		482,796		13.1	%		482,796		63,149
1999		281,094		752,326		37.4	%		752,326		281,094
2000		378,193		981,385		38.5	%		981,385		378,193
2001		58,582		1,214,288		4.8	%		1,214,288		58,582
2002		308,274		1,431,775		21.5	%		1,431,775		308,274
2003		448,475		1,717,551		26.1	%		1,717,551		448,475
2004		404,314		2,041,343		19.8	%		2,041,343		404,314
2005		710,935		2,399,213		29.6	%		2,399,213		710,935
2006		857,048		2,723,510		31.5	%		2,723,510		857,048
2007		1,204,321		2,506,582		48.0	%		2,506,582		1,204,321
2008		925,848		2,171,184		42.6	%		2,171,184		925,848
2009		544,464		1,618,060		33.6	%		1,618,060		544,464
2010		N/A		N/A		41.4	% *		937,264		388,459
Total		6,274,460		20,596,333		30.5	%		21,533,597		6,662,919

* Average of 2007-2009 Ultimate Loss Ratios

Milliman

SBCA
Exhibit A6

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection

	A-Priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent			Indicated		Losses		Ultimate
Year	Losses*		Unreported			Unreported		@12/31/09		Losses**
1995		0		0.3	%		0		0		0
1996		31,018		0.3	%		93		31,018		31,111
1997		58,745		0.3	%		176		58,745		58,921
1998		63,149		0.4	%		253		63,149		63,402
1999		281,094		0.6	%		1,687		281,094		282,781
2000		378,193		0.8	%		3,026		378,192		381,218
2001		58,582		1.1	%		644		58,582		59,226
2002		308,274		2.0	%		6,165		308,274		314,439
2003		448,475		2.8	%		12,557		430,719		443,276
2004		404,314		4.5	%		18,194		457,865		476,059
2005		710,935		9.3	%		66,117		757,535		823,652
2006		857,048		18.5	%		158,554		790,207		948,761
2007		1,204,321		29.7	%		357,683		967,308		1,324,991
2008		925,848		46.0	%		425,890		513,880		939,770
2009		544,464		69.3	%		377,314		200,446		577,760
2010		517,945		90.7	%		469,776		37,063		380,129
Total		6,792,405					1,898,129		5,334,077		7,105,496

*	Based on Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

SBCA
Exhibit A7

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Selection of 1995-2010 Ultimate Losses

	Incurred		Indicated Ultimate Losses Based on								Selected
Accident	Losses		Paid Loss		Incurred Loss		Loss Ratio		Incurred B/F		Ultimate
Year	@9/30/10		Projection		Projection		Projection		Projection		Losses*
1995		0		0		0		0		0		0
1996		31,018		31,204		31,111		31,018		31,111		31,018
1997		58,745		59,097		58,921		58,745		58,921		58,745
1998		63,149		63,591		63,402		63,149		63,402		63,149
1999		281,094		283,624		282,781		281,094		282,781		281,094
2000		378,192		382,351		381,218		378,193		381,218		378,192
2001		58,582		59,518		59,226		58,582		59,226		58,582
2002		308,274		316,286		314,439		308,274		314,439		308,274
2003		430,719		450,957		443,210		448,475		443,276		443,243
2004		457,865		462,423		479,385		404,314		476,059		477,722
2005		757,535		851,181		834,804		710,935		823,652		829,228
2006		790,207		1,044,090		969,584		857,048		948,761		959,173
2007		967,308		1,531,195		1,375,512		1,204,321		1,324,991		1,350,252
2008		513,880		1,071,842		951,192		925,848		939,770		945,481
2009		200,446		682,931		653,053		544,464		577,760		615,407
2010		37,063		100,698		300,350		388,459		380,129		384,278
Total		5,334,077		7,390,988		7,198,188		6,662,919		7,105,496		7,183,838

* Ultimate Loss for 2010 is based on an average of the Ultimate Loss Ratios for 2005 through 2009. Selected Ultimate Loss for the 2010 year reflects exposure through September 30, 2010.

Milliman

SBCA
Exhibit A8

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Losses
Year	Losses		Losses		Losses		Outstanding		@9/30/10		@9/30/10
1995		0		0		0		0		0		0
1996		31,018		31,018		31,018		0		0		0
1997		58,745		58,745		58,745		0		0		0
1998		63,149		63,149		63,149		0		0		0
1999		281,094		281,094		281,094		0		0		0
2000		378,192		378,192		378,191		1		0		1
2001		58,582		58,582		58,581		1		0		1
2002		308,274		308,274		308,271		3		0		3
2003		443,243		430,719		430,713		6		12,524		12,530
2004		477,722		457,865		423,852		34,013		19,857		53,870
2005		829,228		757,535		727,505		30,030		71,693		101,723
2006		959,173		790,207		782,676		7,531		168,966		176,497
2007		1,350,252		967,308		942,274		25,034		382,944		407,978
2008		945,481		513,880		473,847		40,033		431,601		471,634
2009		615,407		200,446		148,077		52,369		414,961		467,330
2010		384,278		37,063		5,903		31,160		347,215		378,375
Total		7,183,838		5,334,077		5,113,896		220,181		1,849,761		2,069,942

Milliman

SBCA
Exhibit A9

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE*
Year		12	24	36	48	60	72	84	96	108	120	132	144	156	168	180	192
1995		0	0	112	112	112	112	112	112	112	112	112	112	112	112	112	112
1996		0	0	0	0	0	0	0	0	0	0	0	0	0	0	0
1997		0	226	226	226	226	226	226	226	226	226	226	226	226	226
1998		0	3,148	21,313	24,897	31,845	33,500	33,500	33,500	33,500	33,500	35,033	35,033	35,033
1999		2,021	10,277	17,434	42,046	58,267	63,615	63,615	63,615	63,615	63,615	63,615	63,615
2000		4,603	53,400	84,285	118,479	154,613	181,697	187,961	192,435	192,435	192,435	192,435
2001		6,000	28,045	58,186	62,685	65,011	78,605	78,851	78,851	79,025	79,025
2002		0	11,518	70,549	101,506	105,470	109,256	109,739	112,302	112,662
2003		5,827	44,182	70,232	85,092	94,401	94,443	94,443	94,443
2004		2,178	2,222	45,470	54,048	93,247	118,778	137,587
2005		6,984	50,270	81,784	112,694	144,414	153,637
2006		4,245	7,652	116,745	192,357	226,107
2007		19,784	115,710	170,235	205,984
2008		13,139	45,439	76,256
2009		11,962	19,963
2010		930

* Last Diagonal is as of 9/30/10.

Accident	Paid ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1996		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1997		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		N/A		6.770		1.168		1.279		1.052		1.000		1.000		1.000		1.000		1.046		1.000		1.000
1999		5.085		1.696		2.412		1.386		1.092		1.000		1.000		1.000		1.000		1.000		1.000
2000		11.601		1.578		1.406		1.305		1.175		1.034		1.024		1.000		1.000		1.000
2001		4.674		2.075		1.077		1.037		1.209		1.003		1.000		1.002		1.000
2002		N/A		6.125		1.439		1.039		1.036		1.004		1.023		1.004
2003		7.582		1.590		1.212		1.109		1.000		1.000		1.000
2004		1.020		20.464		1.189		1.725		1.274		1.217
2005		7.198		1.627		1.378		1.281		1.086
2006		1.803		15.257		1.648		1.241
2007		5.849		1.471		1.289
2008		3.458		1.994
2009		1.980
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		5.025		5.137		1.351		1.218		1.092		1.029		1.006		1.001		1.000		1.009		1.000		1.000		1.000		1.000		1.000
Average x H/L		4.704		4.018		1.281		1.186		1.081		1.006		1.004		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		3.762		6.293		1.293		1.210		1.110		1.014		1.008		1.001		1.000
Wtd Average		5.157		2.223		1.376		1.242		1.120		1.048		1.012		1.001		1.000		1.005		1.000		1.000		1.000		1.000
Wtd Avg L5		4.326		2.281		1.370		1.239		1.110		1.056		1.013		1.001		1.000		1.005
WSC Selected		5.059		1.846		1.333		1.176		1.109		1.060		1.042		1.047		1.029		1.013		1.006		1.004		1.004		1.004		1.001		1.005
Selected		5.157		2.223		1.370		1.239		1.110		1.060		1.042		1.010		1.005		1.003		1.001		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		24.418		4.735		2.130		1.555		1.255		1.131		1.067		1.024		1.014		1.009		1.006		1.005		1.005		1.005		1.005		1.005
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		44.797		7.135		2.601		1.682		1.324		1.161		1.083		1.035		1.017		1.010		1.007		1.005		1.005		1.005		1.005		1.005

Milliman

SBCA
Exhibit A10

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

							Cumulative												Indicated
Accident	Paid ALAE						Development Factors						Indicated Ultimate ALAE						Ultimate
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		ALAE
1995		112		112		112		1.005		1.005		1.005		113		113		113		113
1996		0		0		0		1.005		1.005		1.005		0		0		0		0
1997		226		226		226		1.005		1.005		1.005		227		227		227		227
1998		35,033		35,033		35,033		1.006		1.005		1.005		35,243		35,208		35,208		35,208
1999		63,615		63,615		63,615		1.009		1.006		1.005		64,188		63,997		63,933		63,933
2000		192,435		192,435		192,435		1.014		1.009		1.007		195,129		194,167		193,782		193,782
2001		78,851		79,025		79,025		1.024		1.014		1.010		80,743		80,131		79,815		79,815
2002		109,739		112,302		112,662		1.067		1.024		1.017		117,092		114,997		114,577		114,577
2003		94,443		94,443		94,443		1.131		1.067		1.035		106,815		100,771		97,749		97,749
2004		93,247		118,778		137,587		1.255		1.131		1.083		117,025		134,338		149,007		149,007
2005		112,694		144,414		153,637		1.555		1.255		1.161		175,239		181,240		178,373		178,373
2006		116,745		192,357		226,107		2.130		1.555		1.324		248,667		299,115		299,366		299,366
2007		115,710		170,235		205,984		4.735		2.130		1.682		547,887		362,601		346,465		346,465
2008		13,139		45,439		76,256		24.418		4.735		2.601		320,828		215,154		198,342		198,342
2009				11,962		19,963				24.418		7.135				292,088		142,436		142,436
2010						930						44.797						41,661		31,246

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

SBCA
Exhibit A11

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE/Paid Loss + 1*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.000		1.004		1.004		1.004		1.004		1.004		1.004		1.004		1.004		1.004		1.004		1.004		1.004		1.004
1998		1.000		1.288		1.821		1.719		1.920		1.530		1.530		1.530		1.530		1.530		1.555		1.555		1.555
1999		1.139		1.176		1.194		1.354		1.402		1.267		1.258		1.226		1.226		1.226		1.226		1.226
2000		1.437		1.892		1.419		1.480		1.482		1.541		1.518		1.530		1.509		1.509		1.509
2001		1.463		2.397		2.477		2.375		2.426		2.725		2.730		2.346		2.349		2.349
2002		1.000		1.120		1.412		1.430		1.404		1.374		1.377		1.364		1.365
2003		N/A		1.202		1.207		1.240		1.254		1.236		1.224		1.219
2004		1.045		1.023		1.332		1.206		1.301		1.350		1.325
2005		1.133		1.298		1.225		1.216		1.225		1.211
2006		1.179		1.039		1.251		1.289		1.289
2007		1.218		1.200		1.213		1.219
2008		1.083		1.117		1.161
2009		2.106		1.135
2010		1.158

* Last Diagonal is as of 9/30/10.

Accident	Paid ALAE/Paid Loss + 1 Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.004		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		1.288		1.414		0.944		1.117		0.797		1.000		1.000		1.000		1.000		1.016		1.000		1.000
1999		1.033		1.015		1.134		1.035		0.904		0.993		0.974		1.000		1.000		1.000		1.000
2000		1.316		0.750		1.043		1.001		1.040		0.985		1.008		0.986		1.000		1.000
2001		1.639		1.033		0.959		1.021		1.123		1.002		0.859		1.001		1.000
2002		1.120		1.261		1.012		0.982		0.979		1.002		0.991		1.001
2003		N/A		1.004		1.027		1.011		0.985		0.991		0.994
2004		0.979		1.302		0.906		1.079		1.037		0.976
2005		1.145		0.944		0.992		1.008		0.985
2006		0.881		1.205		1.030		1.000
2007		0.986		1.011		1.006
2008		1.031		1.055
2009		0.507
**      Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		1.077		1.076		1.005		1.023		0.985		0.994		0.978		0.998		1.000		1.003		1.000		1.000		1.000		1.000
Average x H/L		1.078		1.075		1.001		1.017		0.991		0.996		0.993		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		0.966		1.090		1.008		1.006		1.003		0.992		0.987		1.000		1.000		1.000
WSC Selected		1.022		1.023		1.010		1.008		1.004		1.003		1.002		1.003		1.001		1.001		1.001		1.000		1.000		1.001		1.000		1.000
Selected		1.022		1.090		1.008		1.006		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		1.133		1.109		1.017		1.009		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		1.217		1.115		1.039		1.011		1.005		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

SBCA
Exhibit A12

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

					(3)
	(1)		(2)		[(1)x(2)]		(4)		(5)
	Paid ALAE/		Cumulative Ratio		Projected		Selected		[(3)-1]*(4)
	Paid Loss + 1		Development		Ultimate		Ultimate		Indicated
Accident	Ratio		Factors for		Ratio		Losses		Ultimate
Year	@9/30/10		9/10-Ult		@9/30/10		@9/30/10		ALAE
1995		N/A		1.000		N/A		0		N/A
1996		1.000		1.000		1.000		31,018		0
1997		1.004		1.000		1.004		58,745		235
1998		1.555		1.000		1.555		63,149		35,048
1999		1.226		1.000		1.226		281,094		63,527
2000		1.509		1.000		1.509		378,192		192,500
2001		2.349		1.000		2.349		58,582		79,027
2002		1.365		1.000		1.365		308,274		112,520
2003		1.219		1.000		1.219		443,243		97,070
2004		1.325		1.000		1.325		477,722		155,260
2005		1.211		1.001		1.212		829,228		175,796
2006		1.289		1.005		1.295		959,173		282,956
2007		1.219		1.011		1.232		1,350,252		313,258
2008		1.161		1.039		1.206		945,481		194,769
2009		1.135		1.115		1.265		615,407		163,083
2010		1.158		1.217		1.409		384,278		157,170

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

SBCA
Exhibit A13

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Bornhuetter/Ferguson Projection

	A-Priori		Estimated					Paid		Indicated
Accident	Ultimate		Percent			Indicated		ALAE		Ultimate
Year	ALAE*		Unpaid			Unpaid		@12/31/09		ALAE
1995		112		0.5	%		1		112		113
1996		0		0.5	%		0		0		0
1997		226		0.5	%		1		226		227
1998		35,033		0.5	%		175		35,033		35,208
1999		63,615		0.5	%		318		63,615		63,933
2000		192,435		0.7	%		1,347		192,435		193,782
2001		79,025		1.0	%		790		79,025		79,815
2002		112,302		1.7	%		1,909		112,662		114,571
2003		107,490		3.4	%		3,655		94,443		98,098
2004		140,656		7.7	%		10,831		137,587		148,418
2005		181,609		13.9	%		25,244		153,637		178,881
2006		289,286		24.5	%		70,875		226,107		296,982
2007		359,218		40.5	%		145,483		205,984		351,467
2008		184,253		61.6	%		113,500		76,256		189,756
2009		156,066		86.0	%		134,217		19,963		154,180
Total		1,901,326					508,346		1,397,085		1,905,431

* Based on the Selected Ultimate ALAE from the 12/31/09 analysis.

Milliman

SBCA
Exhibit A14

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

											Ultimate
									Selected		ALAE to
Accident	Paid		Paid ALAE		Paid to Paid		Paid B/F		Ultimate		Ultimate
Year	ALAE		Projection		Projection		Projection		ALAE*		Loss Ratio
1995		112		113		N/A		113		112		0.0000
1996		0		0		0		0		0		0.0000
1997		226		227		235		227		226		0.0038
1998		35,033		35,208		35,048		35,208		35,033		0.5548
1999		63,615		63,933		63,527		63,933		63,615		0.2263
2000		192,435		193,782		192,500		193,782		192,435		0.5088
2001		79,025		79,815		79,027		79,815		79,025		1.3490
2002		112,662		114,577		112,520		114,571		112,662		0.3655
2003		94,443		97,749		97,070		98,098		97,639		0.2203
2004		137,587		149,007		155,260		148,418		150,895		0.3159
2005		153,637		178,373		175,796		178,881		177,683		0.2143
2006		226,107		299,366		282,956		296,982		293,101		0.3056
2007		205,984		346,465		313,258		351,467		337,063		0.2496
2008		76,256		198,342		194,769		189,756		189,756		0.2007
2009		19,963		142,436		163,083		154,180		154,180		0.2505
2010		930		31,246		157,170		N/A		94,148		0.2450
Total		1,398,015		1,930,639		2,022,219		1,905,431		1,977,573		0.2753

* Selected Ultimate ALAE for the 2010 year reflects exposure as of September 30, 2010 and is based on an ALAE to Loss Ratio of 24.5%, which is the weighted average ratio of 2005-2009.

Milliman

SBCA
Exhibit A15

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE

	Ultimate		Paid		Unpaid
Accident	ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1995		112		112		0
1996		0		0		0
1997		226		226		0
1998		35,033		35,033		0
1999		63,615		63,615		0
2000		192,435		192,435		0
2001		79,025		79,025		0
2002		112,662		112,662		0
2003		97,639		94,443		3,196
2004		150,895		137,587		13,308
2005		177,683		153,637		24,046
2006		293,101		226,107		66,994
2007		337,063		205,984		131,079
2008		189,756		76,256		113,500
2009		154,180		19,963		134,217
2010		94,148		930		93,218
Total		1,977,573		1,398,015		579,558

Milliman

SBCA
Exhibit A16

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1995		112		112		112		0		0		0
1996		31,018		31,018		31,018		0		0		0
1997		58,971		58,971		58,971		0		0		0
1998		98,182		98,182		98,182		0		0		0
1999		344,709		344,709		344,709		0		0		0
2000		570,627		570,627		570,626		1		0		1
2001		137,607		137,607		137,606		1		0		1
2002		420,936		420,936		420,933		3		0		3
2003		540,882		525,162		525,156		6		15,720		15,726
2004		628,617		595,452		561,439		34,013		33,165		67,178
2005		1,006,911		911,172		881,142		30,030		95,739		125,769
2006		1,252,274		1,016,314		1,008,783		7,531		235,960		243,491
2007		1,687,315		1,173,292		1,148,258		25,034		514,023		539,057
2008		1,135,237		590,136		550,103		40,033		545,101		585,134
2009		769,587		220,409		168,040		52,369		549,178		601,547
2010		478,426		37,993		6,833		31,160		440,433		471,593
Total		9,161,411		6,732,092		6,511,911		220,181		2,429,319		2,649,500

Milliman

SBCA
Exhibit A17

SURETY BONDING COMPANY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1995		112		112		112		0		0		0
1996		31,018		31,018		31,018		0		0		0
1997		54,722		54,722		54,722		0		0		0
1998		93,604		93,604		93,604		0		0		0
1999		338,582		338,582		338,582		0		0		0
2000		524,038		524,038		524,037		1		0		1
2001		135,349		135,349		135,348		1		0		1
2002		384,052		384,052		384,049		3		0		3
2003		539,666		523,946		523,940		6		15,720		15,726
2004		586,567		553,402		519,389		34,013		33,165		67,178
2005		920,853		825,114		795,084		30,030		95,739		125,769
2006		1,208,883		972,923		965,392		7,531		235,960		243,491
2007		1,681,311		1,167,288		1,142,254		25,034		514,023		539,057
2008		1,134,232		589,131		549,098		40,033		545,101		585,134
2009		758,468		209,290		156,921		52,369		549,178		601,547
2010		478,426		37,993		6,833		31,160		440,433		471,593
Total		8,869,883		6,440,564		6,220,383		220,181		2,429,319		2,649,500

Note: This Exhibit is net of Ultimate Salvage & Subrogation of $291,528 which is equal to the Salvage & Subrogation recoveries to date.

Milliman

SBCA
Exhibit B1

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Accident	Paid Losses*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192
1995		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1996		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1997		0		0		2,700		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002
1998		279		10,279		30,279		30,279		30,279		30,279		30,279		30,279		30,279		30,279		30,279		30,279		30,279
1999		13,616		43,116		48,116		103,116		153,086		158,086		164,291		184,291		207,791		207,791		207,791		207,791
2000		0		31,450		108,244		169,944		244,944		278,944		278,944		278,944		293,944		293,944		295,444
2001		0		61,859		95,859		135,859		145,859		145,859		150,859		175,859		175,859		175,859
2002		250		56,250		115,875		182,875		221,875		253,375		263,375		271,875		291,875
2003		0		60,250		163,737		232,373		259,123		289,123		322,123		405,456
2004		12,163		129,763		175,036		386,565		528,065		520,565		520,565
2005		0		203,500		560,284		831,889		1,079,720		1,177,220
2006		0		24,000		206,129		442,129		499,629
2007		0		58,000		155,500		185,500
2008		0		15,000		22,500
2009		0		10,000
2010		0

* Last Diagonal is as of 9/30/10.

Accident	Paid Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1997		N/A		N/A		0.371		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		36.842		2.946		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1999		3.167		1.116		2.143		1.485		1.033		1.039		1.122		1.128		1.000		1.000		1.000
2000		N/A		3.442		1.570		1.441		1.139		1.000		1.000		1.054		1.000		1.007
2001		N/A		1.550		1.417		1.074		1.000		1.034		1.166		1.000		1.000
2002		225.000		2.060		1.578		1.213		1.142		1.039		1.032		1.099
2003		N/A		2.718		1.419		1.115		1.116		1.114		1.359
2004		10.669		1.349		2.208		1.366		0.986		1.000
2005		N/A		2.753		1.485		1.298		1.122
2006		N/A		8.589		2.145		1.177
2007		N/A		2.681		1.265
2008		N/A		1.717
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		68.919		2.811		1.509		1.217		1.060		1.028		1.097		1.047		1.000		1.002		1.000		1.000		1.000
Average x H/L		23.755		2.357		1.558		1.211		1.058		1.019		1.064		1.038		1.000		1.000		1.000
Avg L5 x H/L		N/A		2.384		1.683		1.229		1.079		1.025		1.107		1.051		1.000
Wtd Average		26.360		2.433		1.632		1.266		1.084		1.032		1.140		1.070		1.000		1.004		1.000		1.000		1.000
Wtd Avg L5		N/A		2.609		1.658		1.257		1.083		1.032		1.143		1.070		1.000
WSC Selected		8.264		2.239		1.474		1.175		1.139		1.059		1.064		1.037		1.015		1.010		1.005		1.003		1.002		1.001		1.000		1.000
Selected		8.264		2.433		1.632		1.266		1.084		1.059		1.064		1.037		1.015		1.010		1.005		1.003		1.002		1.001		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		54.509		6.596		2.711		1.661		1.312		1.210		1.143		1.074		1.036		1.021		1.011		1.006		1.003		1.001		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		109.457		11.184		3.386		1.877		1.392		1.235		1.159		1.091		1.045		1.025		1.014		1.007		1.004		1.002		1.000		1.000

Milliman

SBCA
Exhibit B2

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Paid Loss Projection

							Cumulative												Indicated
Accident	Paid Losses						Development Factors						Indicated Ultimate Losses						Ultimate
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1995		0		0		0		1.001		1.000		1.000		0		0		0		0
1996		0		0		0		1.003		1.001		1.000		0		0		0		0
1997		1,002		1,002		1,002		1.006		1.003		1.002		1,008		1,005		1,004		1,004
1998		30,279		30,279		30,279		1.011		1.006		1.004		30,612		30,461		30,400		30,400
1999		207,791		207,791		207,791		1.021		1.011		1.007		212,155		210,077		209,246		209,246
2000		293,944		293,944		295,444		1.036		1.021		1.014		304,526		300,117		299,580		299,580
2001		175,859		175,859		175,859		1.074		1.036		1.025		188,873		182,190		180,255		180,255
2002		263,375		271,875		291,875		1.143		1.074		1.045		301,038		291,994		305,009		305,009
2003		289,123		322,123		405,456		1.210		1.143		1.091		349,839		368,187		442,352		442,352
2004		528,065		520,565		520,565		1.312		1.210		1.159		692,821		629,884		603,335		603,335
2005		831,889		1,079,720		1,177,220		1.661		1.312		1.235		1,381,768		1,416,593		1,453,867		1,453,867
2006		206,129		442,129		499,629		2.711		1.661		1.392		558,816		734,376		695,484		695,484
2007		58,000		155,500		185,500		6.596		2.711		1.877		382,568		421,561		348,184		348,184
2008		0		15,000		22,500		54.509		6.596		3.386		0		98,940		76,185		76,185
2009				0		10,000				54.509		11.184				0		111,840		111,840
2010						0						109.457						0		0

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

SBCA
Exhibit B3

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Accident	Incurred Losses*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192
1995		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1996		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1997		0		0		2,700		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002		1,002
1998		279		30,279		55,279		30,279		30,284		30,281		30,279		30,280		30,280		30,280		30,279		30,279		30,279
1999		13,616		58,116		63,116		103,123		153,091		158,089		164,295		184,293		207,794		207,794		207,791		207,791
2000		14,418		96,450		137,553		184,253		244,951		278,949		279,948		278,948		293,946		293,946		295,444
2001		30,000		64,360		95,864		135,862		145,862		145,863		165,862		175,865		175,860		175,860
2002		256		56,279		132,021		226,526		290,517		297,017		285,894		291,880		291,879
2003		6		60,272		163,766		232,402		360,648		375,647		375,630		408,964
2004		14,679		159,792		304,086		503,113		597,109		555,582		575,577
2005		23		302,833		669,861		909,473		1,107,260		1,177,246
2006		17		80,048		427,170		507,159		549,652
2007		15,007		73,016		155,511		185,506
2008		4		15,006		47,505
2009		2		10,001
2010		0

* Last Diagonal is as of 9/30/10.

Accident	Incurred Loss Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1997		N/A		N/A		0.371		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		108.527		1.826		0.548		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1999		4.268		1.086		1.634		1.485		1.033		1.039		1.122		1.128		1.000		1.000		1.000
2000		6.690		1.426		1.340		1.329		1.139		1.004		0.996		1.054		1.000		1.007
2001		2.145		1.489		1.417		1.074		1.000		1.137		1.060		1.000		1.000
2002		219.840		2.346		1.716		1.282		1.022		0.963		1.021		1.000
2003		N/A		2.717		1.419		1.552		1.042		1.000		1.120
2004		10.886		1.903		1.655		1.187		0.930		1.048
2005		N/A		2.212		1.358		1.217		1.085
2006		N/A		5.336		1.187		1.113
2007		4.865		2.130		1.265
2008		N/A		4.648
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		51.032		2.465		1.264		1.224		1.028		1.024		1.046		1.030		1.000		1.002		1.000		1.000		1.000
Average x H/L		27.047		2.300		1.314		1.211		1.026		1.015		1.040		1.013		1.000		1.000		1.000
Avg L5 x H/L		N/A		2.997		1.347		1.229		1.021		1.017		1.067		1.018		1.000
Wtd Average		11.284		2.285		1.373		1.234		1.039		1.023		1.061		1.040		1.000		1.004		1.000		1.000		1.000
Wtd Avg L5		31.283		2.579		1.365		1.228		1.030		1.022		1.063		1.040		1.000
WSC Selected		2.776		1.725		1.457		1.224		1.184		1.018		1.024		1.010		1.007		1.004		1.003		1.002		1.002		1.001		1.001		1.000
Selected		2.776		2.285		1.373		1.234		1.039		1.023		1.042		1.025		1.007		1.004		1.003		1.002		1.001		1.001		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		12.414		4.472		1.957		1.425		1.155		1.112		1.087		1.043		1.018		1.011		1.007		1.004		1.002		1.001		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		21.336		5.772		2.406		1.543		1.217		1.123		1.093		1.054		1.024		1.013		1.008		1.005		1.003		1.001		1.000		1.000

Milliman

SBCA
Exhibit B4

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Incurred Loss Projection

							Cumulative												Indicated
Accident	Incurred Losses						Development Factors						Indicated Ultimate Losses						Ultimate
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		Losses
1995		0		0		0		1.001		1.000		1.000		0		0		0		0
1996		0		0		0		1.002		1.001		1.000		0		0		0		0
1997		1,002		1,002		1,002		1.004		1.002		1.001		1,006		1,004		1,003		1,003
1998		30,279		30,279		30,279		1.007		1.004		1.003		30,491		30,400		30,370		30,370
1999		207,794		207,791		207,791		1.011		1.007		1.005		210,080		209,246		208,830		208,830
2000		293,946		293,946		295,444		1.018		1.011		1.008		299,237		297,179		297,808		297,808
2001		175,865		175,860		175,860		1.043		1.018		1.013		183,427		179,025		178,146		178,146
2002		285,894		291,880		291,879		1.087		1.043		1.024		310,767		304,431		298,884		298,884
2003		375,647		375,630		408,964		1.112		1.087		1.054		417,719		408,310		431,048		431,048
2004		597,109		555,582		575,577		1.155		1.112		1.093		689,661		617,807		629,106		629,106
2005		909,473		1,107,260		1,177,246		1.425		1.155		1.123		1,295,999		1,278,885		1,322,047		1,322,047
2006		427,170		507,159		549,652		1.957		1.425		1.217		835,972		722,702		668,926		668,926
2007		73,016		155,511		185,506		4.472		1.957		1.543		326,528		304,335		286,236		286,236
2008		4		15,006		47,505		12.414		4.472		2.406		50		67,107		114,297		114,297
2009				2		10,001				12.414		5.772				25		57,726		57,726
2010						0						21.336						0		0

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods. The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

SBCA
Exhibit B5

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Loss Ratio Projection

	Selected		Gross		Ultimate			Gross		Loss Ratio
Accident	Ultimate Losses		Earned Premium		Loss Ratios			Earned Premium		Projection
Year	@12/31/09		@12/31/09		@12/31/09			@9/30/10		@9/30/10
1995		0		10,660		0.0	%		10,660		0
1996		0		33,655		0.0	%		33,655		0
1997		1,002		190,950		0.5	%		190,950		1,002
1998		30,279		367,686		8.2	%		367,686		30,279
1999		207,791		771,140		26.9	%		771,140		207,791
2000		293,946		1,059,417		27.7	%		1,059,417		293,946
2001		175,860		1,360,803		12.9	%		1,360,803		175,860
2002		301,817		1,583,082		19.1	%		1,583,082		301,817
2003		399,837		2,136,770		18.7	%		2,136,770		399,837
2004		600,303		3,203,759		18.7	%		3,203,759		600,303
2005		1,258,864		4,380,428		28.7	%		4,380,428		1,258,864
2006		646,336		3,332,260		19.4	%		3,332,260		646,336
2007		249,158		1,109,827		22.5	%		1,109,827		249,158
2008		64,194		624,726		10.3	%		624,726		64,194
2009		63,905		328,722		19.4	%		328,722		63,905
2010		N/A		N/A		17.4	%*		98,036		17,047
Total		4,293,292		20,493,885		20.9	%		20,591,921		4,310,339

* Average of 2007-2009 Ultimate Loss Ratios

Milliman

SBCA
Exhibit B6

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Incurred Bornhuetter/Ferguson Projection

	A-Priori		Estimated					Incurred		Indicated
Accident	Ultimate		Percent			Indicated		Losses		Ultimate
Year	Losses*		Unreported			Unreported		@12/31/09		Losses**
1995		0		0.0	%		0		0		0
1996		0		0.0	%		0		0		0
1997		1,002		0.1	%		1		1,002		1,003
1998		30,279		0.3	%		91		30,279		30,370
1999		207,791		0.5	%		1,039		207,791		208,830
2000		293,946		0.8	%		2,352		295,444		297,796
2001		175,860		1.3	%		2,286		175,860		178,146
2002		301,817		2.3	%		6,942		291,879		298,821
2003		399,837		5.1	%		20,392		408,964		429,356
2004		600,303		8.5	%		51,026		575,577		626,603
2005		1,258,864		11.0	%		138,475		1,177,246		1,315,721
2006		646,336		17.8	%		115,048		549,652		664,700
2007		249,158		35.2	%		87,704		185,506		273,210
2008		64,194		58.4	%		37,489		47,505		84,994
2009		63,905		82.7	%		52,849		10,001		62,850
2010		22,729		95.3	%		21,661		0		16,246
Total		4,316,021					537,355		3,956,706		4,488,646

*	Based on Indicated Ultimate Loss from the Loss Ratio Projection. 2010 has been adjusted to reflect a full year of exposure.
**	2010 Indicated Ultimate Loss has been adjusted to reflect 9 months of exposure.

Milliman

SBCA
Exhibit B7

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Selection of 1995-2010 Ultimate Losses

	Incurred		Indicated Ultimate Losses Based on								Selected
Accident	Losses		Paid Loss		Incurred Loss		Loss Ratio		Incurred B/F		Ultimate
Year	@9/30/10		Projection		Projection		Projection		Projection		Losses*
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		1,002		1,004		1,003		1,002		1,003		1,002
1998		30,279		30,400		30,370		30,279		30,370		30,279
1999		207,791		209,246		208,830		207,791		208,830		207,791
2000		295,444		299,580		297,808		293,946		297,796		295,444
2001		175,860		180,255		178,146		175,860		178,146		175,860
2002		291,879		305,009		298,884		301,817		298,821		298,884
2003		408,964		442,352		431,048		399,837		429,356		431,048
2004		575,577		603,335		629,106		600,303		626,603		629,106
2005		1,177,246		1,453,867		1,322,047		1,258,864		1,315,721		1,322,047
2006		549,652		695,484		668,926		646,336		664,700		666,813
2007		185,506		348,184		286,236		249,158		273,210		279,723
2008		47,505		76,185		114,297		64,194		84,994		99,646
2009		10,001		111,840		57,726		63,905		62,850		60,288
2010		0		0		0		17,047		16,246		21,470
Total		3,956,706		4,756,741		4,524,427		4,310,339		4,488,646		4,519,401

* Ultimate Loss for 2010 is based on an average of the Ultimate Loss Ratios for 2005 through 2009. Selected Ultimate Loss for the 2010 year reflects exposure through September 30, 2010.

Milliman

SBCA
Exhibit B8

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Losses
Year	Losses		Losses		Losses		Outstanding		@9/30/10		@9/30/10
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		1,002		1,002		1,002		0		0		0
1998		30,279		30,279		30,279		0		0		0
1999		207,791		207,791		207,791		0		0		0
2000		295,444		295,444		295,444		0		0		0
2001		175,860		175,860		175,859		1		0		1
2002		298,884		291,879		291,875		4		7,005		7,009
2003		431,048		408,964		405,456		3,508		22,084		25,592
2004		629,106		575,577		520,565		55,012		53,529		108,541
2005		1,322,047		1,177,246		1,177,220		26		144,801		144,827
2006		666,813		549,652		499,629		50,023		117,161		167,184
2007		279,723		185,506		185,500		6		94,217		94,223
2008		99,646		47,505		22,500		25,005		52,141		77,146
2009		60,288		10,001		10,000		1		50,287		50,288
2010		21,470		0		0		0		21,470		21,470
Total		4,519,401		3,956,706		3,823,120		133,586		562,695		696,281

Milliman

SBCA
Exhibit B9

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Accident	Paid ALAE*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192
1995		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1996		0		0		0		0		0		0		0		0		0		0		0		0		0		0		0
1997		0		0		4,121		5,271		5,271		5,271		5,271		5,271		5,271		5,271		5,271		5,271		5,271		5,271
1998		0		25,760		62,322		89,417		94,325		98,362		98,956		98,956		100,558		100,558		100,558		100,558		100,558
1999		1,072		12,621		36,747		77,738		131,016		159,322		186,817		214,920		233,982		233,982		235,404		242,669
2000		0		32,952		126,447		189,288		241,542		274,419		295,489		300,559		321,963		351,800		357,149
2001		4,508		23,289		48,864		88,952		102,093		120,519		143,645		172,547		192,205		201,264
2002		0		86,053		294,485		529,376		685,867		769,648		792,184		826,620		838,083
2003		180		122,289		252,506		431,997		531,619		635,155		688,618		726,195
2004		37,769		182,389		512,606		866,021		1,065,797		1,204,763		1,279,428
2005		32,512		504,324		1,180,554		1,739,831		2,090,096		2,284,187
2006		33,996		242,431		576,340		945,308		1,107,876
2007		11,176		154,459		241,864		286,164
2008		2,924		44,671		90,418
2009		0		18,590
2010		0

* Last Diagonal is as of 9/30/10.

Accident	Paid ALAE Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1997		N/A		N/A		1.279		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		N/A		2.419		1.435		1.055		1.043		1.006		1.000		1.016		1.000		1.000		1.000		1.000
1999		11.773		2.912		2.115		1.685		1.216		1.173		1.150		1.089		1.000		1.006		1.041
2000		N/A		3.837		1.497		1.276		1.136		1.077		1.017		1.071		1.093		1.020
2001		5.166		2.098		1.820		1.148		1.180		1.192		1.201		1.114		1.063
2002		N/A		3.422		1.798		1.296		1.122		1.029		1.043		1.019
2003		679.383		2.065		1.711		1.231		1.195		1.084		1.073
2004		4.829		2.811		1.689		1.231		1.130		1.083
2005		15.512		2.341		1.474		1.201		1.126
2006		7.131		2.377		1.640		1.236
2007		13.821		1.566		1.251
2008		15.277		2.560
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		94.112		2.583		1.610		1.236		1.128		1.081		1.069		1.051		1.031		1.007		1.014		1.000		1.000
Average x H/L		11.447		2.556		1.594		1.209		1.133		1.075		1.057		1.049		1.021		1.003		1.000
Avg L5 x H/L		9.699		2.426		1.601		1.232		1.146		1.081		1.089		1.059		1.021
Wtd Average		11.530		2.411		1.578		1.232		1.136		1.076		1.067		1.048		1.049		1.012		1.029		1.000		1.000
Wtd Avg L5		11.734		2.327		1.551		1.228		1.136		1.073		1.070		1.048		1.049
WSC Selected		6.777		2.780		1.595		1.287		1.286		1.085		1.070		1.025		1.014		1.015		1.010		1.005		1.003		1.001		1.000		1.000
Selected		6.777		2.411		1.578		1.232		1.136		1.076		1.069		1.037		1.032		1.014		1.010		1.005		1.003		1.001		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		45.867		6.768		2.807		1.779		1.444		1.271		1.181		1.105		1.066		1.033		1.019		1.009		1.004		1.001		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		88.054		10.920		3.498		1.994		1.521		1.312		1.203		1.124		1.076		1.041		1.023		1.012		1.005		1.002		1.000		1.000

Milliman

SBCA
Exhibit B10

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Paid ALAE Projection

							Cumulative												Indicated
Accident	Paid ALAE						Development Factors						Indicated Ultimate ALAE						Ultimate
Year	@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		@12/31/08		@12/31/09		@9/30/10		ALAE
1995		0		0		0		1.001		1.000		1.000		0		0		0		0
1996		0		0		0		1.004		1.001		1.000		0		0		0		0
1997		5,271		5,271		5,271		1.009		1.004		1.002		5,318		5,292		5,282		5,282
1998		100,558		100,558		100,558		1.019		1.009		1.005		102,469		101,463		101,061		101,061
1999		233,982		235,404		242,669		1.033		1.019		1.012		241,703		239,877		245,581		245,581
2000		321,963		351,800		357,149		1.066		1.033		1.023		343,213		363,409		365,363		365,363
2001		172,547		192,205		201,264		1.105		1.066		1.041		190,664		204,891		209,516		209,516
2002		792,184		826,620		838,083		1.181		1.105		1.076		935,569		913,415		901,777		901,777
2003		635,155		688,618		726,195		1.271		1.181		1.124		807,282		813,258		816,243		816,243
2004		1,065,797		1,204,763		1,279,428		1.444		1.271		1.203		1,539,011		1,531,254		1,539,152		1,539,152
2005		1,739,831		2,090,096		2,284,187		1.779		1.444		1.312		3,095,159		3,018,099		2,996,853		2,996,853
2006		576,340		945,308		1,107,876		2.807		1.779		1.521		1,617,786		1,681,703		1,685,079		1,685,079
2007		154,459		241,864		286,164		6.768		2.807		1.994		1,045,379		678,912		570,611		570,611
2008		2,924		44,671		90,418		45.867		6.768		3.498		134,115		302,333		316,282		316,282
2009				0		18,590				45.867		10.920				0		203,003		203,003
2010						0						88.054						0		0

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods. The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

SBCA
Exhibit B11

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Accident	Paid ALAE/Paid Loss + 1*
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168		180		192
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1997		N/A		N/A		2.526		6.260		6.260		6.260		6.260		6.260		6.260		6.260		6.260		6.260		6.260		6.260
1998		1.000		3.506		3.058		3.953		4.115		4.249		4.268		4.268		4.321		4.321		4.321		4.321		4.321
1999		1.079		1.293		1.764		1.754		1.856		2.008		2.137		2.166		2.126		2.126		2.133		2.168
2000		N/A		2.048		2.168		2.114		1.986		1.984		2.059		2.077		2.095		2.197		2.209
2001		N/A		1.376		1.510		1.655		1.700		1.826		1.952		1.981		2.093		2.144
2002		1.000		2.530		3.541		3.895		4.091		4.038		4.008		4.040		3.871
2003		N/A		3.030		2.542		2.859		3.052		3.197		3.138		2.791
2004		4.105		2.406		3.929		3.240		3.018		3.314		3.458
2005		N/A		3.478		3.107		3.091		2.936		2.940
2006		N/A		11.101		3.796		3.138		3.217
2007		N/A		3.663		2.555		2.543
2008		N/A		3.978		5.019
2009		N/A		2.859
2010		N/A

* Last Diagonal is as of 9/30/10.

Accident	Paid ALAE/Paid Loss + 1 Development Factors**
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180		180 - 192		192 - Ult
1995		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1996		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A
1997		N/A		N/A		2.478		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1998		3.506		0.872		1.293		1.041		1.032		1.005		1.000		1.012		1.000		1.000		1.000		1.000
1999		1.198		1.364		0.994		1.058		1.082		1.064		1.014		0.981		1.000		1.003		1.022
2000		N/A		1.059		0.975		0.940		0.999		1.038		1.009		1.009		1.048		1.007
2001		N/A		1.097		1.096		1.027		1.074		1.069		1.015		1.056		1.033
2002		2.530		1.400		1.100		1.050		0.987		0.993		1.008		0.945
2003		N/A		0.839		1.125		1.067		1.048		0.982		0.857
2004		0.586		1.633		0.825		0.931		1.098		1.058
2005		N/A		0.893		0.995		0.950		1.002
2006		N/A		0.342		0.827		1.034
2007		N/A		0.698		0.993
2008		N/A		1.368
2009		N/A
**  Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		1.955		1.051		1.155		1.010		1.036		1.026		0.986		1.001		1.016		1.003		1.007		1.000		1.000
Average x H/L		1.864		1.066		1.044		1.013		1.034		1.026		1.006		1.001		1.011		1.002		1.000
Avg L5 x H/L		N/A		0.986		0.938		1.011		1.041		1.030		1.010		1.001		1.011
WSC Selected		1.732		1.156		1.054		1.053		1.040		1.013		1.010		1.003		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000
Selected		1.732		1.066		1.044		1.013		1.034		1.013		1.010		1.003		1.002		1.000		1.000		1.000		1.000		1.000		1.000

	12-Ult		24-Ult		36-Ult		48-Ult		60-Ult		72-Ult		84-Ult		96-Ult		108-Ult		120-Ult		132-Ult		144-Ult		156-Ult		168-Ult		180-Ult		192-Ult
Dec Cumulatives		2.075		1.198		1.124		1.077		1.063		1.028		1.015		1.005		1.002		1.000		1.000		1.000		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult		177-Ult		189-Ult
Sep Cumulatives		2.472		1.374		1.142		1.089		1.066		1.037		1.018		1.008		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000

Milliman

SBCA
Exhibit B12

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

					(3)
	(1)		(2)		[(1)x(2)]		(4)		(5)
	Paid ALAE/		Cumulative Ratio		Projected		Selected		([(3)-1]*(4)
	Paid Loss + 1		Development		Ultimate		Ultimate		Indicated
Accident	Ratio		Factors for		Ratio		Losses		Ultimate
Year	@9/30/10		9/10-Ult		@9/30/10		@9/30/10		ALAE
1995		N/A		1.000		N/A		0		N/A
1996		N/A		1.000		N/A		0		N/A
1997		6.260		1.000		6.260		1,002		5,271
1998		4.321		1.000		4.321		30,279		100,557
1999		2.168		1.000		2.168		207,791		242,700
2000		2.209		1.000		2.209		295,444		357,192
2001		2.144		1.000		2.144		175,860		201,184
2002		3.871		1.003		3.883		298,884		861,683
2003		2.791		1.008		2.813		431,048		781,490
2004		3.458		1.018		3.520		629,106		1,585,347
2005		2.940		1.037		3.049		1,322,047		2,708,874
2006		3.217		1.066		3.430		666,813		1,620,356
2007		2.543		1.089		2.769		279,723		494,830
2008		5.019		1.142		5.731		99,646		471,425
2009		2.859		1.374		3.928		60,288		176,523
2010		N/A		2.472		N/A		21,470		N/A

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curve fitting methods.

Milliman

SBCA
Exhibit B13

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Paid ALAE Bornhuetter/Ferguson Projection

	A-Priori		Estimated					Paid		Indicated
Accident	Ultimate		Percent			Indicated		ALAE		Ultimate
Year	ALAE*		Unpaid			Unpaid		@12/31/09		ALAE
1995		0		0.0	%		0		0		0
1996		0		0.0	%		0		0		0
1997		5,271		0.2	%		11		5,271		5,282
1998		100,558		0.5	%		503		100,558		101,061
1999		235,404		1.2	%		2,825		242,669		245,494
2000		351,800		2.2	%		7,740		357,149		364,889
2001		192,205		3.9	%		7,496		201,264		208,760
2002		854,380		7.1	%		60,661		838,083		898,744
2003		744,556		11.0	%		81,901		726,195		808,096
2004		1,448,148		16.9	%		244,737		1,279,428		1,524,165
2005		2,914,302		23.8	%		693,604		2,284,187		2,977,791
2006		1,544,348		34.3	%		529,711		1,107,876		1,637,587
2007		572,561		49.8	%		285,135		286,164		571,299
2008		315,428		71.4	%		225,216		90,418		315,634
2009		155,434		90.8	%		141,134		18,590		159,724
Total		9,434,395					2,280,674		7,537,852		9,818,526

* Based on the Selected Ultimate ALAE from the 12/31/09 analysis.

Milliman

SBCA
Exhibit B14

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

											Ultimate
									Selected		ALAE to
Accident	Paid		Paid ALAE		Paid to Paid		Paid B/F		Ultimate		Ultimate
Year	ALAE		Projection		Projection		Projection		ALAE*		Loss Ratio
1995		0		0		N/A		0		0		0.0000
1996		0		0		N/A		0		0		0.0000
1997		5,271		5,282		5,271		5,282		5,271		5.2605
1998		100,558		101,061		100,557		101,061		100,558		3.3210
1999		242,669		245,581		242,700		245,494		242,669		1.1679
2000		357,149		365,363		357,192		364,889		357,149		1.2089
2001		201,264		209,516		201,184		208,760		201,264		1.1445
2002		838,083		901,777		861,683		898,744		900,261		3.0121
2003		726,195		816,243		781,490		808,096		812,170		1.8842
2004		1,279,428		1,539,152		1,585,347		1,524,165		1,531,659		2.4347
2005		2,284,187		2,996,853		2,708,874		2,977,791		2,708,874		2.0490
2006		1,107,876		1,685,079		1,620,356		1,637,587		1,661,333		2.4915
2007		286,164		570,611		494,830		571,299		570,955		2.0411
2008		90,418		316,282		471,425		315,634		315,958		3.1708
2009		18,590		203,003		176,523		159,724		159,724		2.6493
2010		0		0		N/A		N/A		47,900		2.2310
Total		7,537,852		9,955,803		9,607,432		9,818,526		9,615,745		2.1277

* Selected Ultimate ALAE for the 2010 year reflects exposure as of September 30, 2010 and is based on an ALAE to Loss Ratio of 223.1%, which is the weighted average ratio of 2005-2009.

Milliman

SBCA
Exhibit B15

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE

	Ultimate		Paid		Unpaid
Accident	ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		@9/30/10
1995		0		0		0
1996		0		0		0
1997		5,271		5,271		0
1998		100,558		100,558		0
1999		242,669		242,669		0
2000		357,149		357,149		0
2001		201,264		201,264		0
2002		900,261		838,083		62,178
2003		812,170		726,195		85,975
2004		1,531,659		1,279,428		252,231
2005		2,708,874		2,284,187		424,687
2006		1,661,333		1,107,876		553,457
2007		570,955		286,164		284,791
2008		315,958		90,418		225,540
2009		159,724		18,590		141,134
2010		47,900		0		47,900
Total		9,615,745		7,537,852		2,077,893

Milliman

SBCA
Exhibit B16

SURETY BONDING COMPANY OF AMERICA
GROSS NOTARY E&O
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		6,273		6,273		6,273		0		0		0
1998		130,837		130,837		130,837		0		0		0
1999		450,460		450,460		450,460		0		0		0
2000		652,593		652,593		652,593		0		0		0
2001		377,124		377,124		377,123		1		0		1
2002		1,199,145		1,129,962		1,129,958		4		69,183		69,187
2003		1,243,218		1,135,159		1,131,651		3,508		108,059		111,567
2004		2,160,765		1,855,005		1,799,993		55,012		305,760		360,772
2005		4,030,921		3,461,433		3,461,407		26		569,488		569,514
2006		2,328,146		1,657,528		1,607,505		50,023		670,618		720,641
2007		850,678		471,670		471,664		6		379,008		379,014
2008		415,604		137,923		112,918		25,005		277,681		302,686
2009		220,012		28,591		28,590		1		191,421		191,422
2010		69,370		0		0		0		69,370		69,370
Total		14,135,146		11,494,558		11,360,972		133,586		2,640,588		2,774,174

Milliman

SBCA
Exhibit C1

SURETY BONDING COMPANY OF AMERICA
NET SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses

							Selected		Selected		Indicated		Selected
	Gross		Net		Ratio of		Ratio of		Gross		Net		Net		Net		Total Net
	Incurred		Incurred		Net to		Net to		Ultimate		Ultimate		Ultimate		Paid		Unpaid
Accident	Loss		Loss		Gross		Gross		Loss		Loss		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Loss		Loss		@9/30/10		@9/30/10		@9/30/10		@9/30/10		@9/30/10
1995		0		0		0.000		0.100		0		0		0		0		0
1996		31,018		3,102		0.100		0.100		31,018		3,102		3,102		3,102		0
1997		58,745		5,875		0.100		0.100		58,745		5,875		5,875		5,875		0
1998		63,149		6,315		0.100		0.100		63,149		6,315		6,315		6,315		0
1999		281,094		28,109		0.100		0.100		281,094		28,109		28,109		28,109		0
2000		378,192		37,829		0.100		0.100		378,192		37,819		37,829		37,829		0
2001		58,582		5,872		0.100		0.100		58,582		5,858		5,872		5,872		0
2002		308,274		30,827		0.100		0.100		308,274		30,827		30,827		30,827		0
2003		430,719		43,073		0.100		0.100		443,243		44,324		44,324		43,072		1,252
2004		457,865		45,785		0.100		0.100		477,722		47,772		47,772		42,384		5,388
2005		757,535		75,754		0.100		0.100		829,228		82,923		82,923		72,751		10,172
2006		790,207		79,021		0.100		0.100		959,173		95,917		95,917		78,268		17,649
2007		967,308		96,732		0.100		0.100		1,350,252		135,025		135,025		94,228		40,797
2008		513,880		51,388		0.100		0.100		945,481		94,548		94,548		47,385		47,163
2009		200,446		20,045		0.100		0.100		615,407		61,541		61,541		14,808		46,733
2010		37,063		3,706		0.100		0.100		384,278		38,428		38,428		590		37,838
Total		5,334,077		533,433		0.100				7,183,838		718,383		718,407		511,415		206,992

Milliman

SBCA
Exhibit C2

SURETY BONDING COMPANY OF AMERICA
NET SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE

							Selected		Selected		Indicated		Selected
	Gross		Net		Ratio of		Ratio of		Gross		Net		Net		Net		Total Net
	Paid		Paid		Net to		Net to		Ultimate		Ultimate		Ultimate		Paid		Unpaid
Accident	ALAE		ALAE		Gross		Gross		ALAE		Loss		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		ALAE		ALAE		@9/30/10		@9/30/10		@9/30/10		@9/30/10		@9/30/10
1995		112		11		0.098		0.100		112		11		11		11		0
1996		0		0		0.000		0.100		0		0		0		0		0
1997		226		23		0.102		0.100		226		23		23		23		0
1998		35,033		3,503		0.100		0.100		35,033		3,503		3,503		3,503		0
1999		63,615		6,362		0.100		0.100		63,615		6,362		6,362		6,362		0
2000		192,435		19,241		0.100		0.100		192,435		19,244		19,241		19,241		0
2001		79,025		7,903		0.100		0.100		79,025		7,903		7,903		7,903		0
2002		112,662		11,266		0.100		0.100		112,662		11,266		11,266		11,266		0
2003		94,443		9,444		0.100		0.100		97,639		9,764		9,764		9,444		320
2004		137,587		13,759		0.100		0.100		150,895		15,090		15,090		13,759		1,331
2005		153,637		15,363		0.100		0.100		177,683		17,768		17,768		15,363		2,405
2006		226,107		22,611		0.100		0.100		293,101		29,310		29,310		22,611		6,699
2007		205,984		20,598		0.100		0.100		337,063		33,706		33,706		20,598		13,108
2008		76,256		7,626		0.100		0.100		189,756		18,976		18,976		7,626		11,350
2009		19,963		1,996		0.100		0.100		154,180		15,418		15,418		1,996		13,422
2010		930		93		0.100		0.100		94,148		9,415		9,415		93		9,322
Total		1,398,015		139,799		0.100				1,977,573		197,759		197,756		139,799		57,957

Milliman

SBCA
Exhibit C3

SURETY BONDING COMPANY OF AMERICA
NET SURETY
GROSS OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1995		11		11		11		0		0		0
1996		3,102		3,102		3,102		0		0		0
1997		5,898		5,898		5,898		0		0		0
1998		9,818		9,818		9,818		0		0		0
1999		34,471		34,471		34,471		0		0		0
2000		57,070		57,070		57,070		0		0		0
2001		13,775		13,775		13,775		0		0		0
2002		42,093		42,093		42,093		0		0		0
2003		54,088		52,517		52,516		1		1,571		1,572
2004		62,862		59,544		56,143		3,401		3,318		6,719
2005		100,691		91,117		88,114		3,003		9,574		12,577
2006		125,227		101,632		100,879		753		23,595		24,348
2007		168,731		117,330		114,826		2,504		51,401		53,905
2008		113,524		59,014		55,011		4,003		54,510		58,513
2009		76,959		22,041		16,804		5,237		54,918		60,155
2010		47,843		3,799		683		3,116		44,044		47,160
Total		916,163		673,232		651,214		22,018		242,931		264,949

Milliman

SBCA
Exhibit C4

SURETY BONDING COMPANY OF AMERICA
NET SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1995		11		11		11		0		0		0
1996		3,102		3,102		3,102		0		0		0
1997		5,473		5,473		5,473		0		0		0
1998		9,360		9,360		9,360		0		0		0
1999		33,858		33,858		33,858		0		0		0
2000		52,401		52,401		52,401		0		0		0
2001		13,549		13,549		13,549		0		0		0
2002		38,404		38,404		38,404		0		0		0
2003		53,966		52,395		52,394		1		1,571		1,572
2004		58,657		55,339		51,938		3,401		3,318		6,719
2005		92,085		82,511		79,508		3,003		9,574		12,577
2006		120,888		97,293		96,540		753		23,595		24,348
2007		168,130		116,729		114,225		2,504		51,401		53,905
2008		113,424		58,914		54,911		4,003		54,510		58,513
2009		75,847		20,929		15,692		5,237		54,918		60,155
2010		47,843		3,799		683		3,116		44,044		47,160
Total		886,998		644,067		622,049		22,018		242,931		264,949

Note: This Exhibit is net of Ultimate Salvage & Subrogation of $29,165 which is equal to the Salvage & Subrogation recoveries to date.

Milliman

SBCA
Exhibit D1

SURETY BONDING COMPANY OF AMERICA
NET NOTARY E&O
EVALUATED AS OF 9/30/10

Summary of Ultimate Losses

							Selected		Selected		Indicated		Selected
	Gross		Net		Ratio of		Ratio of		Gross		Net		Net		Net		Total Net
	Incurred		Incurred		Net to		Net to		Ultimate		Ultimate		Ultimate		Paid		Unpaid
Accident	Loss		Loss		Gross		Gross		Loss		Loss		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Loss		Loss		@9/30/10		@9/30/10		@9/30/10		@9/30/10		@9/30/10
1995		0		0		0.000		0.100		0		0		0		0		0
1996		0		0		0.000		0.100		0		0		0		0		0
1997		1,002		100		0.100		0.100		1,002		100		100		100		0
1998		30,279		3,028		0.100		0.100		30,279		3,028		3,028		3,028		0
1999		207,791		20,779		0.100		0.100		207,791		20,779		20,779		20,779		0
2000		295,444		29,544		0.100		0.100		295,444		29,544		29,544		29,544		0
2001		175,860		17,586		0.100		0.100		175,860		17,586		17,586		17,586		0
2002		291,879		29,188		0.100		0.100		298,884		29,888		29,888		29,188		700
2003		408,964		40,897		0.100		0.100		431,048		43,105		43,105		40,546		2,559
2004		575,577		57,557		0.100		0.100		629,106		62,911		62,911		52,056		10,855
2005		1,177,246		117,724		0.100		0.100		1,322,047		132,205		132,205		117,721		14,484
2006		549,652		54,965		0.100		0.100		666,813		66,681		66,681		49,963		16,718
2007		185,506		18,551		0.100		0.100		279,723		27,972		27,972		18,550		9,422
2008		47,505		4,751		0.100		0.100		99,646		9,965		9,965		2,250		7,715
2009		10,001		1,000		0.100		0.100		60,288		6,029		6,029		1,000		5,029
2010		0		0		0.000		0.100		21,470		2,147		2,147		0		2,147
Total		3,956,706		395,670		0.100				4,519,401		451,940		451,940		382,311		69,629

Milliman

SBCA
Exhibit D2

SURETY BONDING COMPANY OF AMERICA
NET NOTARY E&O
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE

							Selected		Selected		Indicated		Selected
	Gross		Net		Ratio of		Ratio of		Gross		Net		Net		Net		Total Net
	Paid		Paid		Net to		Net to		Ultimate		Ultimate		Ultimate		Paid		Unpaid
Accident	ALAE		ALAE		Gross		Gross		ALAE		Loss		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		ALAE		ALAE		@9/30/10		@9/30/10		@9/30/10		@9/30/10		@9/30/10
1995		0		0		0.000		0.100		0		0		0		0		0
1996		0		0		0.000		0.100		0		0		0		0		0
1997		5,271		527		0.100		0.100		5,271		527		527		527		0
1998		100,558		10,055		0.100		0.100		100,558		10,056		10,055		10,055		0
1999		242,669		24,266		0.100		0.100		242,669		24,267		24,266		24,266		0
2000		357,149		35,714		0.100		0.100		357,149		35,715		35,714		35,714		0
2001		201,264		20,127		0.100		0.100		201,264		20,126		20,127		20,127		0
2002		838,083		83,808		0.100		0.100		900,261		90,026		90,026		83,808		6,218
2003		726,195		75,466		0.104		0.100		812,170		81,217		81,217		75,466		5,751
2004		1,279,428		130,313		0.102		0.100		1,531,659		153,166		153,166		130,313		22,853
2005		2,284,187		231,958		0.102		0.100		2,708,874		270,887		270,887		231,958		38,929
2006		1,107,876		114,467		0.103		0.100		1,661,333		166,133		166,133		114,467		51,666
2007		286,164		28,617		0.100		0.100		570,955		57,096		57,096		28,617		28,479
2008		90,418		9,042		0.100		0.100		315,958		31,596		31,596		9,042		22,554
2009		18,590		1,859		0.100		0.100		159,724		15,972		15,972		1,859		14,113
2010		0		0		0.000		0.100		47,900		4,790		4,790		0		4,790
Total		7,537,852		766,219		0.102				9,615,745		961,574		961,572		766,219		195,353

Milliman

SBCA
Exhibit D3

SURETY BONDING COMPANY OF AMERICA
NET NOTARY E&O
EVALUATED AS OF 9/30/10

Summary of Ultimate Loss & ALAE

											Unpaid
Accident	Ultimate		Incurred		Paid		Case		IBNR		Loss & ALAE
Year	Loss & ALAE		Loss & ALAE		Loss & ALAE		Outstanding		@9/30/10		@9/30/10
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		627		627		627		0		0		0
1998		13,083		13,083		13,083		0		0		0
1999		45,045		45,045		45,045		0		0		0
2000		65,258		65,258		65,258		0		0		0
2001		37,713		37,713		37,713		0		0		0
2002		119,914		112,996		112,996		0		6,918		6,918
2003		124,322		116,363		116,012		351		7,959		8,310
2004		216,077		187,870		182,369		5,501		28,207		33,708
2005		403,092		349,682		349,679		3		53,410		53,413
2006		232,814		169,432		164,430		5,002		63,382		68,384
2007		85,068		47,168		47,167		1		37,900		37,901
2008		41,561		13,793		11,292		2,501		27,768		30,269
2009		22,001		2,859		2,859		0		19,142		19,142
2010		6,937		0		0		0		6,937		6,937
Total		1,413,512		1,161,889		1,148,530		13,359		251,623		264,982

Milliman

SBCA
Exhibit E1

SURETY BONDING COMPANY OF AMERICA

GROSS SURETY
INCURRED LOSS B-F PROJECTION GROSS OF
SALVAGE & SUBROGATION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Ultimate		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Loss		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unreported		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		1.000		0.0	%		0		0		0		0		0		0
1996		31,018		31,018		1.000		0.0	%		0		31,018		31,018		31,018		31,018		0
1997		58,745		58,745		1.000		0.0	%		0		58,745		58,745		58,745		58,745		0
1998		63,149		63,149		1.000		0.0	%		0		63,149		63,149		63,149		63,149		0
1999		281,094		281,094		1.000		0.0	%		0		281,094		281,094		281,094		281,094		0
2000		378,192		378,192		1.000		0.0	%		0		378,192		378,192		378,192		378,191		1
2001		58,582		58,582		1.000		0.0	%		0		58,582		58,582		58,582		58,581		1
2002		308,274		308,274		1.000		0.0	%		0		308,274		308,274		308,274		308,271		3
2003		443,243		430,719		0.972		2.1	%		9,308		430,717		440,025		440,025		430,713		9,312
2004		477,722		457,865		0.958		3.8	%		18,153		467,866		486,019		486,019		433,852		52,167
2005		829,228		757,535		0.914		7.5	%		62,192		772,532		834,724		834,724		727,505		107,219
2006		959,173		790,207		0.824		15.4	%		147,713		790,205		937,918		937,918		782,676		155,242
2007		1,350,252		967,308		0.716		25.7	%		347,015		969,809		1,316,824		1,316,824		942,274		374,550
2008		945,481		513,880		0.544		41.3	%		390,484		518,881		909,365		909,365		496,347		413,018
2009		615,407		200,446		0.326		62.0	%		381,552		194,246		575,798		595,603		179,233		416,370
2010		507,087		37,063		0.073		86.4	%		438,123		24,179		462,302		507,087		7,164		499,923
Total		7,306,647		5,334,077							1,794,540		5,347,489		7,142,029		7,206,619		5,178,813		2,027,806

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit E2

SURETY BONDING COMPANY OF AMERICA

GROSS SURETY
PAID ALAE B-F PROJECTION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Paid		Implicit		Percent					Paid		Ultimate		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		112		112		1.000		0.0	%		0		112		112		112		0
1996		0		0		1.000		0.0	%		0		0		0		0		0
1997		226		226		1.000		0.0	%		0		226		226		226		0
1998		35,033		35,033		1.000		0.0	%		0		35,033		35,033		35,033		0
1999		63,615		63,615		1.000		0.0	%		0		63,615		63,615		63,615		0
2000		192,435		192,435		1.000		0.0	%		0		192,435		192,435		192,435		0
2001		79,025		79,025		1.000		0.0	%		0		79,025		79,025		79,025		0
2002		112,662		112,662		1.000		0.0	%		0		112,662		112,662		112,662		0
2003		97,639		94,443		0.967		2.5	%		2,441		94,443		96,884		96,884		2,441
2004		150,895		137,587		0.912		7.4	%		11,166		154,419		165,585		165,585		11,166
2005		177,683		153,637		0.865		12.4	%		22,033		157,992		180,025		180,025		22,033
2006		293,101		226,107		0.771		20.5	%		60,086		238,868		298,954		298,954		60,086
2007		337,063		205,984		0.611		34.9	%		117,635		212,143		329,778		329,778		117,635
2008		189,756		76,256		0.402		54.6	%		103,607		97,906		201,513		201,513		103,607
2009		154,180		19,963		0.129		80.2	%		123,652		20,414		144,066		149,123		128,709
2010		124,236		930		0.007		96.2	%		119,515		1,581		121,096		124,236		122,655
Total		2,007,661		1,398,015							560,135		1,460,874		2,021,009		2,029,206		568,332

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit E3

SURETY BONDING COMPANY OF AMERICA

GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 12/31/10
SUMMARY OF UNPAID LOSS & ALAE ($000s)

	Selected						Paid		Unpaid		IBNR
	Ult Loss		Paid		Paid		Loss &		Loss &		Loss &
Accident	& ALAE		Loss		ALAE		ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		112		0		112		112		0		0
1996		31,018		31,018		0		31,018		0		0
1997		54,722		54,496		226		54,722		0		0
1998		93,604		58,571		35,033		93,604		0		0
1999		338,582		274,967		63,615		338,582		0		0
2000		524,038		331,602		192,435		524,037		1		0
2001		135,349		56,323		79,025		135,348		1		0
2002		384,052		271,387		112,662		384,049		3		0
2003		535,693		429,497		94,443		523,940		11,753		11,749
2004		609,554		391,802		154,419		546,221		63,333		29,319
2005		924,671		637,427		157,992		795,419		129,252		84,225
2006		1,193,456		739,260		238,868		978,128		215,328		207,799
2007		1,639,998		935,670		212,143		1,147,813		492,185		464,650
2008		1,109,873		495,342		97,906		593,248		516,625		494,091
2009		733,707		168,214		20,414		188,628		545,079		530,066
2010		631,323		7,164		1,581		8,745		622,578		605,563
Total		8,939,752		4,882,740		1,460,874		6,343,614		2,596,138		2,427,462

Note: This Exhibit is net of Ultimate Salvage & Subrogation of $296,073 which is equal to the Salvage & Subrogation recoveries to date.

Milliman

SBCA
Exhibit F1

SURETY BONDING COMPANY OF AMERICA

GROSS NOTARY E&O
INCURRED LOSS B-F PROJECTION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Ultimate		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Loss		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unreported		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		1.000		0.0	%		0		0		0		0		0		0
1996		0		0		1.000		0.0	%		0		0		0		0		0		0
1997		1,002		1,002		1.000		0.0	%		0		1,002		1,002		1,002		1,002		0
1998		30,279		30,279		1.000		0.0	%		0		30,279		30,279		30,279		30,279		0
1999		207,791		207,791		1.000		0.0	%		0		207,791		207,791		207,791		207,791		0
2000		295,444		295,444		1.000		0.0	%		0		295,444		295,444		295,444		295,444		0
2001		175,860		175,860		1.000		0.0	%		0		175,860		175,860		175,860		175,859		1
2002		298,884		291,879		0.977		1.8	%		5,380		291,879		297,259		297,259		291,875		5,384
2003		431,048		408,964		0.949		4.4	%		18,966		408,962		427,928		427,928		405,456		22,472
2004		629,106		575,577		0.915		7.7	%		48,441		595,580		644,021		644,021		540,565		103,456
2005		1,322,047		1,177,246		0.890		10.3	%		136,171		1,192,746		1,328,917		1,328,917		1,177,220		151,697
2006		666,813		549,652		0.824		15.9	%		106,023		540,654		646,677		646,677		507,629		139,048
2007		279,723		185,506		0.663		29.7	%		83,078		193,010		276,088		276,088		185,500		90,588
2008		99,646		47,505		0.477		47.7	%		47,531		50,005		97,536		97,536		42,000		55,536
2009		60,288		10,001		0.166		75.6	%		45,578		10,001		55,579		57,934		10,000		47,934
2010		26,475		0		0.000		95.9	%		25,389		1		25,390		26,475		0		26,475
Total		4,524,406		3,956,706							516,557		3,993,214		4,509,771		4,513,211		3,870,620		642,591

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit F2

SURETY BONDING COMPANY OF AMERICA

GROSS NOTARY E&O
PAID ALAE B-F PROJECTION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Paid		Implicit		Percent					Paid		Ultimate		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		1.000		0.0	%		0		0		0		0		0
1996		0		0		1.000		0.0	%		0		0		0		0		0
1997		5,271		5,271		1.000		0.0	%		0		5,271		5,271		5,271		0
1998		100,558		100,558		1.000		0.0	%		0		100,558		100,558		100,558		0
1999		242,669		242,669		1.000		0.0	%		0		242,670		242,670		242,670		0
2000		357,149		357,149		1.000		0.0	%		0		357,149		357,149		357,149		0
2001		201,264		201,264		1.000		0.0	%		0		206,480		206,480		206,480		0
2002		900,261		838,083		0.931		5.2	%		46,814		838,083		884,897		884,897		46,814
2003		812,170		726,195		0.894		9.7	%		78,780		727,931		806,711		806,711		78,780
2004		1,531,659		1,279,428		0.835		15.0	%		229,749		1,323,045		1,552,794		1,552,794		229,749
2005		2,708,874		2,284,187		0.843		15.9	%		430,711		2,339,863		2,770,574		2,770,574		430,711
2006		1,661,333		1,107,876		0.667		28.9	%		480,125		1,140,737		1,620,862		1,620,862		480,125
2007		570,955		286,164		0.501		45.7	%		260,926		299,201		560,127		560,127		260,926
2008		315,958		90,418		0.286		66.0	%		208,532		103,937		312,469		312,469		208,532
2009		159,724		18,590		0.116		84.1	%		134,328		18,920		153,248		156,486		137,566
2010		59,065		0		0.000		97.1	%		57,352		0		57,352		59,065		59,065
Total		9,626,910		7,537,852							1,927,317		7,703,845		9,631,162		9,636,113		1,932,268

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit F3

SURETY BONDING COMPANY OF AMERICA

GROSS NOTARY E&O
EVALUATED AS OF 12/31/10
SUMMARY OF UNPAID LOSS & ALAE ($000s)

	Selected						Paid		Unpaid		IBNR
	Ult Loss		Paid		Paid		Loss &		Loss &		Loss &
Accident	& ALAE		Loss		ALAE		ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		6,273		1,002		5,271		6,273		0		0
1998		130,837		30,279		100,558		130,837		0		0
1999		450,461		207,791		242,670		450,461		0		0
2000		652,593		295,444		357,149		652,593		0		0
2001		382,340		175,859		206,480		382,339		1		0
2002		1,182,156		291,875		838,083		1,129,958		52,198		52,194
2003		1,234,639		405,456		727,931		1,133,387		101,252		97,746
2004		2,196,815		540,565		1,323,045		1,863,610		333,205		278,190
2005		4,099,491		1,177,220		2,339,863		3,517,083		582,408		566,882
2006		2,267,539		507,629		1,140,737		1,648,366		619,173		586,148
2007		836,215		185,500		299,201		484,701		351,514		344,004
2008		410,005		42,000		103,937		145,937		264,068		256,063
2009		214,420		10,000		18,920		28,920		185,500		185,499
2010		85,540		0		0		0		85,540		85,539
Total		14,149,324		3,870,620		7,703,845		11,574,465		2,574,859		2,452,265

Milliman

SBCA
Exhibit G1

SURETY BONDING COMPANY OF AMERICA

NET SURETY
INCURRED LOSS B-F PROJECTION
GROSS OF SALVAGE & SUBROGATION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Ultimate		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Loss		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unreported		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		1.000		0.0	%		0		0		0		0		0		0
1996		3,102		3,102		1.000		0.0	%		0		3,102		3,102		3,102		3,102		0
1997		5,875		5,875		1.000		0.0	%		0		5,875		5,875		5,875		5,875		0
1998		6,315		6,315		1.000		0.0	%		0		6,315		6,315		6,315		6,315		0
1999		28,109		28,109		1.000		0.0	%		0		28,109		28,109		28,109		28,109		0
2000		37,829		37,829		1.000		0.0	%		0		37,829		37,829		37,829		37,829		0
2001		5,872		5,872		1.000		0.0	%		0		5,872		5,872		5,872		5,872		0
2002		30,827		30,827		1.000		0.0	%		0		30,827		30,827		30,827		30,827		0
2003		44,324		43,073		0.972		2.1	%		931		43,072		44,003		44,003		43,072		931
2004		47,772		45,785		0.958		3.8	%		1,815		46,785		48,600		48,600		43,384		5,216
2005		82,923		75,754		0.914		7.5	%		6,219		77,254		83,473		83,473		72,751		10,722
2006		95,917		79,021		0.824		15.4	%		14,771		79,021		93,792		93,792		78,268		15,524
2007		135,025		96,732		0.716		25.7	%		34,701		96,982		131,683		131,683		94,228		37,455
2008		94,548		51,388		0.544		41.3	%		39,048		51,889		90,937		90,937		49,635		41,302
2009		61,541		20,045		0.326		62.0	%		38,155		19,424		57,579		59,560		17,923		41,637
2010		50,708		3,706		0.073		86.4	%		43,812		2,418		46,230		50,708		716		49,992
Total		730,687		533,433							179,452		534,774		714,226		720,685		517,906		202,779

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit G2

SURETY BONDING COMPANY OF AMERICA

NET SURETY
PAID ALAE B-F PROJECTION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Paid		Implicit		Percent					Paid		Ultimate		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		11		11		1.000		0.0	%		0		11		11		11		0
1996		0		0		1.000		0.0	%		0		0		0		0		0
1997		23		23		1.000		0.0	%		0		23		23		23		0
1998		3,503		3,503		1.000		0.0	%		0		3,503		3,503		3,503		0
1999		6,362		6,362		1.000		0.0	%		0		6,362		6,362		6,362		0
2000		19,241		19,241		1.000		0.0	%		0		19,241		19,241		19,241		0
2001		7,903		7,903		1.000		0.0	%		0		7,903		7,903		7,903		0
2002		11,266		11,266		1.000		0.0	%		0		11,266		11,266		11,266		0
2003		9,764		9,444		0.967		2.5	%		244		9,444		9,688		9,688		244
2004		15,090		13,759		0.912		7.4	%		1,117		15,442		16,559		16,559		1,117
2005		17,768		15,363		0.865		12.4	%		2,203		15,799		18,002		18,002		2,203
2006		29,310		22,611		0.771		20.5	%		6,009		23,887		29,896		29,896		6,009
2007		33,706		20,598		0.611		34.9	%		11,763		21,214		32,977		32,977		11,763
2008		18,976		7,626		0.402		54.6	%		10,361		9,791		20,152		20,152		10,361
2009		15,418		1,996		0.129		80.2	%		12,365		2,041		14,406		14,912		12,871
2010		12,424		93		0.007		96.2	%		11,952		158		12,110		12,424		12,266
Total		200,765		139,799							56,014		146,085		202,099		202,919		56,834

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit G3

SURETY BONDING COMPANY OF AMERICA

NET SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 12/31/10
SUMMARY OF UNPAID LOSS & ALAE ($000s)

	Selected						Paid		Unpaid		IBNR
	Ult Loss		Paid		Paid		Loss &		Loss &		Loss &
Accident	& ALAE		Loss		ALAE		ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		11		0		11		11		0		0
1996		3,102		3,102		0		3,102		0		0
1997		5,473		5,450		23		5,473		0		0
1998		9,360		5,857		3,503		9,360		0		0
1999		33,858		27,496		6,362		33,858		0		0
2000		52,401		33,160		19,241		52,401		0		0
2001		13,549		5,646		7,903		13,549		0		0
2002		38,404		27,138		11,266		38,404		0		0
2003		53,569		42,950		9,444		52,394		1,175		1,175
2004		60,954		39,179		15,442		54,621		6,333		2,932
2005		92,467		63,743		15,799		79,542		12,925		8,422
2006		119,346		73,926		23,887		97,813		21,533		20,780
2007		163,999		93,567		21,214		114,781		49,218		46,464
2008		110,989		49,535		9,791		59,326		51,663		49,409
2009		73,370		16,821		2,041		18,862		54,508		53,007
2010		63,132		716		158		874		62,258		60,556
Total		893,984		488,286		146,085		634,371		259,613		242,745

Note: This Exhibit is net of Ultimate Salvage & Subrogation of $29,620 which is equal to the Salvage & Subrogation recoveries to date.

Milliman

SBCA
Exhibit H1

SURETY BONDING COMPANY OF AMERICA

NET NOTARY E&O
INCURRED LOSS B-F PROJECTION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Ultimate		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Loss		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unreported		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		1.000		0.0	%		0		0		0		0		0		0
1996		0		0		1.000		0.0	%		0		0		0		0		0		0
1997		100		100		1.000		0.0	%		0		100		100		100		100		0
1998		3,028		3,028		1.000		0.0	%		0		3,028		3,028		3,028		3,028		0
1999		20,779		20,779		1.000		0.0	%		0		20,779		20,779		20,779		20,779		0
2000		29,544		29,544		1.000		0.0	%		0		29,544		29,544		29,544		29,544		0
2001		17,586		17,586		1.000		0.0	%		0		17,586		17,586		17,586		17,586		0
2002		29,888		29,188		0.977		1.8	%		538		29,188		29,726		29,726		29,188		538
2003		43,105		40,897		0.949		4.4	%		1,897		40,897		42,794		42,794		40,546		2,248
2004		62,911		57,557		0.915		7.7	%		4,844		59,558		64,402		64,402		54,056		10,346
2005		132,205		117,724		0.890		10.3	%		13,617		119,274		132,891		132,891		117,721		15,170
2006		66,681		54,965		0.824		15.9	%		10,602		54,065		64,667		64,667		50,763		13,904
2007		27,972		18,551		0.663		29.7	%		8,308		19,301		27,609		27,609		18,550		9,059
2008		9,965		4,751		0.477		47.7	%		4,753		5,000		9,753		9,753		4,200		5,553
2009		6,029		1,000		0.166		75.6	%		4,558		1,000		5,558		5,794		1,000		4,794
2010		2,648		0		0.000		95.9	%		2,539		0		2,539		2,648		0		2,648
Total		452,441		395,670							51,656		399,320		450,976		451,321		387,061		64,260

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit H2

SURETY BONDING COMPANY OF AMERICA

NET NOTARY E&O
PAID ALAE B-F PROJECTION

	Selected						Interpolated							Indicated		Selected
	Ultimate		Paid		Implicit		Percent					Paid		Ultimate		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		1.000		0.0	%		0		0		0		0		0
1996		0		0		1.000		0.0	%		0		0		0		0		0
1997		527		527		1.000		0.0	%		0		527		527		527		0
1998		10,055		10,055		1.000		0.0	%		0		10,055		10,055		10,055		0
1999		24,266		24,266		1.000		0.0	%		0		24,267		24,267		24,267		0
2000		35,714		35,714		1.000		0.0	%		0		35,714		35,714		35,714		0
2001		20,127		20,127		1.000		0.0	%		0		20,648		20,648		20,648		0
2002		90,026		83,808		0.931		5.2	%		4,681		83,808		88,489		88,489		4,681
2003		81,217		75,466		0.929		7.0	%		5,685		75,639		81,324		81,324		5,685
2004		153,166		130,313		0.851		13.0	%		19,912		134,675		154,587		154,587		19,912
2005		270,887		231,958		0.856		14.5	%		39,279		237,526		276,805		276,805		39,279
2006		166,133		114,467		0.689		26.9	%		44,690		117,753		162,443		162,443		44,690
2007		57,096		28,617		0.501		45.2	%		25,807		29,921		55,728		55,728		25,807
2008		31,596		9,042		0.286		66.0	%		20,853		10,394		31,247		31,247		20,853
2009		15,972		1,859		0.116		84.1	%		13,432		1,892		15,324		15,648		13,756
2010		5,907		0		0.000		97.1	%		5,736		0		5,736		5,907		5,907
Total		962,689		766,219							180,075		782,819		962,894		963,389		180,570

* The 2010 year has been adjusted to a full year basis.

Milliman

SBCA
Exhibit H3

SURETY BONDING COMPANY OF AMERICA

NET NOTARY E&O
EVALUATED AS OF 12/31/10
SUMMARY OF UNPAID LOSS & ALAE ($000s)

	Selected						Paid		Unpaid		IBNR
	Ult Loss		Paid		Paid		Loss &		Loss &		Loss &
Accident	& ALAE		Loss		ALAE		ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		0		0		0		0		0		0
1996		0		0		0		0		0		0
1997		627		100		527		627		0		0
1998		13,083		3,028		10,055		13,083		0		0
1999		45,046		20,779		24,267		45,046		0		0
2000		65,258		29,544		35,714		65,258		0		0
2001		38,234		17,586		20,648		38,234		0		0
2002		118,215		29,188		83,808		112,996		5,219		5,219
2003		124,118		40,546		75,639		116,185		7,933		7,582
2004		218,989		54,056		134,675		188,731		30,258		24,756
2005		409,696		117,721		237,526		355,247		54,449		52,896
2006		227,110		50,763		117,753		168,516		58,594		55,292
2007		83,337		18,550		29,921		48,471		34,866		34,115
2008		41,000		4,200		10,394		14,594		26,406		25,606
2009		21,442		1,000		1,892		2,892		18,550		18,550
2010		8,555		0		0		0		8,555		8,555
Total		1,414,710		387,061		782,819		1,169,880		244,830		232,571

Milliman

SBCA
Exhibit I1

SURETY BONDING COMPANY OF AMERICA

SUMMARY OF GROSS UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION

	Surety										Notary E&O
	Selected				Selected												Total
	Ultimate				Ultimate		Paid		Unpaid								Unpaid
	Loss & ALAE				Loss & ALAE		Loss & ALAE		Loss & ALAE		Selected						Loss & ALAE
	Gross of		Sal/Sub		Net of		Net of		Net of		Ultimate		Paid		Unpaid		Net of
Accident	Sal/Sub		Recovered		Sal/Sub		Sal/Sub		Sal/Sub		Loss & ALAE		Loss & ALAE		Loss & ALAE		Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		112		0		112		112		0		0		0		0		0
1996		31,018		0		31,018		31,018		0		0		0		0		0
1997		58,971		4,249		54,722		54,722		0		6,273		6,273		0		0
1998		98,182		4,578		93,604		93,604		0		130,837		130,837		0		0
1999		344,709		6,127		338,582		338,582		0		450,461		450,461		0		0
2000		570,627		46,589		524,038		524,037		1		652,593		652,593		0		1
2001		137,607		2,258		135,349		135,348		1		382,340		382,339		1		2
2002		420,936		36,884		384,052		384,049		3		1,182,156		1,129,958		52,198		52,201
2003		536,909		1,216		535,693		523,940		11,753		1,234,639		1,133,387		101,252		113,005
2004		651,604		42,050		609,554		546,221		63,333		2,196,815		1,863,610		333,205		396,538
2005		1,014,749		90,078		924,671		795,419		129,252		4,099,491		3,517,083		582,408		711,660
2006		1,236,872		43,416		1,193,456		978,128		215,328		2,267,539		1,648,366		619,173		834,501
2007		1,646,602		6,604		1,639,998		1,147,813		492,185		836,215		484,701		351,514		843,699
2008		1,110,878		1,005		1,109,873		593,248		516,625		410,005		145,937		264,068		780,693
2009		744,726		11,019		733,707		188,628		545,079		214,420		28,920		185,500		730,579
2010		631,323		0		631,323		8,745		622,578		85,540		0		85,540		708,118
Total		9,235,825		296,073		8,939,752		6,343,614		2,596,138		14,149,324		11,574,465		2,574,859		5,170,997
Non Reviewed Unpaid Loss & ALAE																		410,560
Total Unpaid Loss & ALAE																		5,581,557

Milliman

SBCA
Exhibit I2

SURETY BONDING COMPANY OF AMERICA

SUMMARY OF NET UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION

	Surety										Notary E&O
	Selected				Selected												Total
	Ultimate				Ultimate		Paid		Unpaid								Unpaid
	Loss & ALAE				Loss & ALAE		Loss & ALAE		Loss & ALAE		Selected						Loss & ALAE
	Gross of		Sal/Sub		Net of		Net of		Net of		Ultimate		Paid		Unpaid		Net of
Accident	Sal/Sub		Recovered		Sal/Sub		Sal/Sub		Sal/Sub		Loss & ALAE		Loss & ALAE		Loss & ALAE		Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		11		0		11		11		0		0		0		0		0
1996		3,102		0		3,102		3,102		0		0		0		0		0
1997		5,898		425		5,473		5,473		0		627		627		0		0
1998		9,818		458		9,360		9,360		0		13,083		13,083		0		0
1999		34,471		613		33,858		33,858		0		45,046		45,046		0		0
2000		57,070		4,669		52,401		52,401		0		65,258		65,258		0		0
2001		13,775		226		13,549		13,549		0		38,234		38,234		0		0
2002		42,093		3,689		38,404		38,404		0		118,215		112,996		5,219		5,219
2003		53,691		122		53,569		52,394		1,175		124,118		116,185		7,933		9,108
2004		65,159		4,205		60,954		54,621		6,333		218,989		188,731		30,258		36,591
2005		101,475		9,008		92,467		79,542		12,925		409,696		355,247		54,449		67,374
2006		123,688		4,342		119,346		97,813		21,533		227,110		168,516		58,594		80,127
2007		164,660		661		163,999		114,781		49,218		83,337		48,471		34,866		84,084
2008		111,089		100		110,989		59,326		51,663		41,000		14,594		26,406		78,069
2009		74,472		1,102		73,370		18,862		54,508		21,442		2,892		18,550		73,058
2010		63,132		0		63,132		874		62,258		8,555		0		8,555		70,813
Total		923,604		29,620		893,984		634,371		259,613		1,414,710		1,169,880		244,830		504,443
Non Reviewed Unpaid Loss & ALAE																		41,055
Total Unpaid Loss & ALAE																		545,498

Milliman

SBCA
Exhibit I3

SURETY BONDING COMPANY OF AMERICA

SUMMARY OF CEDED UNPAID LOSS & ALAE
NET OF SALVAGE & SUBROGATION

	Surety										Notary E&O
	Selected				Selected												Total
	Ultimate				Ultimate		Paid		Unpaid								Unpaid
	Loss & ALAE				Loss & ALAE		Loss & ALAE		Loss & ALAE		Selected						Loss & ALAE
	Gross of		Sal/Sub		Net of		Net of		Net of		Ultimate		Paid		Unpaid		Net of
Accident	Sal/Sub		Recovered		Sal/Sub		Sal/Sub		Sal/Sub		Loss & ALAE		Loss & ALAE		Loss & ALAE		Sal/Sub
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1995		101		0		101		101		0		0		0		0		0
1996		27,916		0		27,916		27,916		0		0		0		0		0
1997		53,073		3,824		49,249		49,249		0		5,646		5,646		0		0
1998		88,364		4,120		84,244		84,244		0		117,754		117,754		0		0
1999		310,238		5,514		304,724		304,724		0		405,415		405,415		0		0
2000		513,557		41,920		471,637		471,636		1		587,335		587,335		0		1
2001		123,832		2,032		121,800		121,799		1		344,106		344,105		1		2
2002		378,843		33,195		345,648		345,645		3		1,063,941		1,016,962		46,979		46,982
2003		483,218		1,094		482,124		471,546		10,578		1,110,521		1,017,202		93,319		103,897
2004		586,445		37,845		548,600		491,600		57,000		1,977,826		1,674,879		302,947		359,947
2005		913,274		81,070		832,204		715,877		116,327		3,689,795		3,161,836		527,959		644,286
2006		1,113,184		39,074		1,074,110		880,315		193,795		2,040,429		1,479,850		560,579		754,374
2007		1,481,942		5,943		1,475,999		1,033,032		442,967		752,878		436,230		316,648		759,615
2008		999,789		905		998,884		533,922		464,962		369,005		131,343		237,662		702,624
2009		670,254		9,917		660,337		169,766		490,571		192,978		26,028		166,950		657,521
2010		568,191		0		568,191		7,871		560,320		76,985		0		76,985		637,305
Total		8,312,221		266,453		8,045,768		5,709,243		2,336,525		12,734,614		10,404,585		2,330,029		4,666,554
Non Reviewed Unpaid Loss & ALAE																		369,505
Total Unpaid Loss & ALAE																		5,036,059

Milliman

SBCA
Exhibit J1

SURETY BONDING COMPANY OF AMERICA

GROSS OF REINSURANCE
NET OF SALVAGE & SUBROGATION
DEVELOPMENT OF UNPAID ULAE
EVALUATED AS OF DECEMBER 31, 2010

	(1)			(2)		(3)		(4)
								Selected
	Paid ULAE					Milliman		Unpaid
	to Paid Loss			Gross Case		Estimated		ULAE****
Line of Business	& ALAE*			Reserves		Gross IBNR**		@12/31/10
Surety		8.5	%		168,676		2,427,462		213,503
Notary E&O		8.5	%		122,594		2,452,265		213,653
All Other***		8.5	%		30,012		380,548		33,622
Total					321,282		5,260,275		460,778

*	Based on the selected ratio for Western Surety Company
**	See Exhibits E3 and F3, respectively
***	Includes Tax Preparers’ E&O, Fidelity and Burglary & Theft
****	(4) = (1)x (2)x 0.5 + (1)x (3)

Milliman

UNIVERSAL SURETY OF AMERICA

Milliman

USA
Exhibit A1

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid Losses ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168
1989		1,056		1,298		1,361		1,367		1,367		1,342		1,291		1,260		1,257		1,257		1,257		1,257		1,257		1,257
1990		280		376		396		396		396		396		396		396		396		396		396		396		396		396
1991		583		759		774		784		787		787		786		786		786		786		786		786		786		786
1992		26		409		473		451		442		442		442		442		447		447		447		447		447		447
1993		357		1,174		1,287		1,392		1,392		1,388		1,350		1,346		1,346		1,356		1,395		1,395		1,395		1,395
1994		2,187		3,301		3,825		4,036		3,893		3,879		3,875		3,846		3,841		3,841		3,841		3,841		3,828		3,828
1995		1,572		2,799		2,867		2,780		2,759		2,736		2,731		2,721		2,724		2,716		2,716		2,716		2,706		2,706
1996		1,159		1,729		1,779		1,787		1,798		2,100		2,163		2,157		2,145		2,144		2,144		2,144		2,144		2,143
1997		1,609		3,218		3,484		3,519		3,486		3,508		3,358		3,353		3,312		3,312		3,311		3,311		3,297		3,297
1998		2,525		4,536		4,883		4,699		5,061		5,294		5,257		5,129		5,024		4,938		4,938		4,938		4,938
1999		1,211		3,709		4,608		5,100		5,052		5,358		5,284		5,248		5,205		5,157		5,152		5,150
2000		1,519		3,073		3,937		4,803		4,759		4,765		4,682		4,682		4,673		4,673		4,673
2001		1,105		2,135		2,187		2,200		2,165		2,148		2,127		2,132		2,132		2,132
2002		35		87		196		245		241		236		261		261		271
2003		20		141		192		284		324		341		340		341
2004		14		187		222		234		261		272		272
2005		75		150		254		297		308		318
2006		20		101		146		180		191
2007		0		77		111		145
2008		26		97		177
2009		46		61
2010		336

Last diagonal is as of 9/30/10.

Accident	Paid Loss Development Factors
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180
1989		1.229		1.049		1.004		1.000		0.982		0.962		0.976		0.998		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.343		1.053		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.302		1.020		1.013		1.004		1.000		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		15.731		1.156		0.953		0.980		1.000		1.000		1.000		1.011		1.000		1.000		1.000		1.000		1.000		1.000
1993		3.289		1.096		1.082		1.000		0.997		0.973		0.997		1.000		1.007		1.029		1.000		1.000		1.000		1.000
1994		1.509		1.159		1.055		0.965		0.996		0.999		0.993		0.999		1.000		1.000		1.000		0.997		1.000		1.000
1995		1.781		1.024		0.970		0.992		0.992		0.998		0.996		1.001		0.997		1.000		1.000		0.996		1.000		1.000
1996		1.492		1.029		1.004		1.006		1.168		1.030		0.997		0.994		1.000		1.000		1.000		1.000		1.000		1.000
1997		2.000		1.083		1.010		0.991		1.006		0.957		0.999		0.988		1.000		1.000		1.000		0.996		1.000
1998		1.796		1.076		0.962		1.077		1.046		0.993		0.976		0.980		0.983		1.000		1.000		1.000
1999		3.063		1.242		1.107		0.991		1.061		0.986		0.993		0.992		0.991		0.999		0.999
2000		2.023		1.281		1.220		0.991		1.001		0.983		1.000		0.998		1.000		1.000
2001		1.932		1.024		1.006		0.984		0.992		0.990		1.002		1.000		1.000
2002		2.486		2.253		1.250		0.984		0.979		1.106		1.000		1.051
2003		7.050		1.362		1.479		1.141		1.052		0.997		1.004
2004		13.357		1.187		1.054		1.115		1.042		1.000
2005		2.000		1.693		1.169		1.037		1.044
2006		5.050		1.446		1.233		1.082
2007		N/A		1.442		1.428
2008		3.731		2.229
2009		1.457
Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		3.681		1.295		1.105		1.019		1.021		0.998		0.996		1.001		0.998		1.002		1.000		0.999		1.000		1.000
Average x H/L		3.148		1.257		1.092		1.015		1.014		0.994		0.996		0.998		0.999		1.000		1.000		0.999		1.000		1.000
Avg L5 x H/L		3.594		1.527		1.277		1.078		1.026		0.996		1.001		0.997		0.997		1.000		1.000		0.998		1.000		1.000
Wtd Average		1.907		1.131		1.052		1.004		1.024		0.989		0.993		0.994		0.996		1.001		1.000		0.998		1.000		1.000
Wtd Avg L5		2.946		1.551		1.247		1.072		1.006		0.990		0.998		0.992		0.993		1.000		1.000		0.998		1.000		1.000
WSC Surety 9/10		4.327		1.498		1.215		1.095		1.040		1.039		1.037		1.016		1.016		1.005		1.004		1.008		1.007		1.005
Sel for 01 & Prior		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.001		1.001		1.001		1.000		1.000		1.000

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.002		1.001		1.000		1.000		1.000
Sel for 02 & Subs		4.327		1.498		1.215		1.095		1.040		1.039		1.037		1.016		1.016		1.005		1.004		1.008		1.007		1.005

	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		15.852		3.454		1.769		1.382		1.230		1.167		1.124		1.083		1.060		1.043		1.035		1.031		1.023		1.016

Milliman

USA
Exhibit A2

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid Loss Projection

	(1)		(2)		(3)
			Cumulative		[(1)x(2)]
	Paid		Paid Loss		Projected
	Losses		Development		Ultimate
Accident	($000s)		Factors		Loss ($000s)
Year	@9/30/10		9/30/10-Ult		@9/30/10
1989		1,257		1.000		1,257
1990		396		1.000		396
1991		786		1.000		786
1992		447		1.000		447
1993		1,395		1.000		1,395
1994		3,828		1.000		3,828
1995		2,706		1.000		2,706
1996		2,143		1.000		2,143
1997		3,297		1.000		3,297
1998		4,938		1.000		4,938
1999		5,150		1.000		5,150
2000		4,673		1.001		4,678
2001		2,132		1.002		2,136
2002		271		1.060		287
2003		341		1.083		369
2004		272		1.124		306
2005		318		1.167		371
2006		191		1.230		235
2007		145		1.382		200
2008		177		1.769		313
2009		61		3.454		211
2010		336		15.852		3,995
Total		35,260				39,444

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods.
The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

USA
Exhibit A3

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Incurred Losses ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168
1989		1,411		1,349		1,367		1,368		1,367		1,342		1,291		1,260		1,257		1,257		1,257		1,257		1,257		1,257
1990		716		402		398		396		396		396		396		396		396		396		396		396		396		396
1991		711		864		822		787		790		787		786		786		786		786		786		786		786		786
1992		562		510		489		509		442		442		442		442		447		447		447		447		447		447
1993		1,032		1,409		1,572		1,429		1,426		1,405		1,367		1,363		1,363		1,356		1,395		1,395		1,395		1,395
1994		3,501		4,445		4,663		4,201		3,910		3,879		3,875		3,846		3,841		3,841		3,841		3,841		3,828		3,828
1995		3,058		3,057		2,972		2,791		2,759		2,736		2,731		2,721		2,724		2,716		2,716		2,716		2,706		2,706
1996		1,557		1,994		1,836		1,901		2,532		2,104		2,167		2,161		2,145		2,144		2,144		2,144		2,144		2,143
1997		2,626		4,265		4,245		3,672		3,524		3,538		3,388		3,353		3,312		3,312		3,311		3,311		3,297		3,297
1998		4,720		5,775		5,826		5,653		5,787		5,416		5,329		5,136		5,030		4,944		4,944		4,938		4,938
1999		3,251		5,484		5,979		5,969		6,220		5,891		5,535		5,312		5,206		5,158		5,152		5,150
2000		2,183		3,761		4,633		5,323		5,013		4,881		4,752		4,682		4,673		4,673		4,673
2001		1,395		2,460		2,380		2,292		2,256		2,159		2,131		2,132		2,142		2,132
2002		86		87		206		245		251		246		261		271		271
2003		20		141		267		300		344		351		355		341
2004		33		209		225		237		264		272		272
2005		241		216		261		297		308		318
2006		22		144		186		220		231
2007		16		93		125		176
2008		26		119		180
2009		54		61
2010		398
Last diagonal is as of 9/30/10.
Accident	Incurred Loss Development Factors
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180
1989		0.956		1.013		1.001		0.999		0.982		0.962		0.976		0.998		1.000		1.000		1.000		1.000		1.000		1.000
1990		0.561		0.990		0.995		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.215		0.951		0.957		1.004		0.996		0.999		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		0.907		0.959		1.041		0.868		1.000		1.000		1.000		1.011		1.000		1.000		1.000		1.000		1.000		1.000
1993		1.365		1.116		0.909		0.998		0.985		0.973		0.997		1.000		0.995		1.029		1.000		1.000		1.000		1.000
1994		1.270		1.049		0.901		0.931		0.992		0.999		0.993		0.999		1.000		1.000		1.000		0.997		1.000		1.000
1995		1.000		0.972		0.939		0.989		0.992		0.998		0.996		1.001		0.997		1.000		1.000		0.996		1.000		1.000
1996		1.281		0.921		1.035		1.332		0.831		1.030		0.997		0.993		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.624		0.995		0.865		0.960		1.004		0.958		0.990		0.988		1.000		1.000		1.000		0.996		1.000
1998		1.224		1.009		0.970		1.024		0.936		0.984		0.964		0.979		0.983		1.000		0.999		1.000
1999		1.687		1.090		0.998		1.042		0.947		0.940		0.960		0.980		0.991		0.999		0.999
2000		1.723		1.232		1.149		0.942		0.974		0.974		0.985		0.998		1.000		1.000
2001		1.763		0.967		0.963		0.984		0.957		0.987		1.000		1.005		0.994
2002		1.012		2.368		1.189		1.024		0.980		1.061		1.038		1.000
2003		7.050		1.894		1.124		1.147		1.020		1.011		0.948
2004		6.333		1.077		1.053		1.114		1.030		1.000
2005		0.896		1.208		1.138		1.037		1.044
2006		6.545		1.292		1.183		1.067
2007		5.813		1.344		1.578
2008		4.577		1.736
2009		1.176
Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		2.380		1.209		1.052		1.026		0.981		0.992		0.990		0.997		0.997		1.002		1.000		0.999		1.000		1.000
Average x H/L		2.230		1.161		1.032		1.016		0.986		0.991		0.989		0.997		0.998		1.000		1.000		0.999		1.000		1.000
Avg L5 x H/L		3.855		1.281		1.148		1.073		1.010		0.999		0.982		0.993		0.995		1.000		1.000		0.998		1.000		1.000
Wtd Average		1.354		1.051		0.983		1.006		0.962		0.979		0.983		0.992		0.995		1.001		1.000		0.998		1.000		1.000
Wtd Avg L5		1.770		1.285		1.176		1.079		0.978		0.983		0.977		0.988		0.993		1.000		1.000		0.998		1.000		1.000
WSC Surety 9/10		2.053		1.265		1.107		1.053		1.034		1.019		1.012		1.008		1.009		1.002		1.002		1.003		1.004		1.002
Sel for 01 & Prior		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.001		1.001		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.001		1.000		1.000		1.000		1.000
Sel for 02 & Subs		2.053		1.265		1.107		1.053		1.034		1.019		1.012		1.008		1.009		1.002		1.002		1.003		1.004		1.002
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		4.350		1.946		1.363		1.191		1.117		1.076		1.052		1.038		1.029		1.020		1.017		1.015		1.012		1.008

Milliman

USA
Exhibit A4

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Incurred Loss Projection

	(1)		(2)		(3)
			Cumulative		[(1)x(2)]
	Incurred		Incurred Loss		Projected
	Losses		Development		Ultimate
Accident	($000s)		Factors		Loss ($000s)
Year	@9/30/10		9/30/10-Ult		@9/30/10
1989		1,257		1.000		1,257
1990		396		1.000		396
1991		786		1.000		786
1992		447		1.000		447
1993		1,395		1.000		1,395
1994		3,828		1.000		3,828
1995		2,706		1.000		2,706
1996		2,143		1.000		2,143
1997		3,297		1.000		3,297
1998		4,938		1.000		4,938
1999		5,150		1.000		5,150
2000		4,673		1.000		4,673
2001		2,132		1.001		2,134
2002		271		1.029		279
2003		341		1.038		354
2004		272		1.052		286
2005		318		1.076		342
2006		231		1.117		258
2007		176		1.191		210
2008		180		1.363		245
2009		61		1.946		119
2010		398		4.350		1,298
Total		35,396				36,541

Note: The 9-Ult Cumulative Loss Development Factor was interpolated using curve fitting methods.

The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

USA
Exhibit A5

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Bornhuetter — Ferguson Projection ($000s)

	2008			2009			2010
1) Gross Earned Premium at 9/10*		3,656			3,595			3,468
2) A-priori Ultimate Loss Ratio		19.2	%		20.7	%		20.7	%
3) A-priori Ultimate Losses at 9/10** (1) x (2)		702			743			717
4) % Unreported (based on Incurred CDF) [ 1 - 1 / CDF ]		0.266			0.486			0.770
5) Projected IBNR at 9/10 (3) x (4)		187			361			552
6) Actual Incurred at 9/10		180			61			398
7) Indicated Ultimate Losses*** [ (5) + (6) ] * 9 / 12 for 2010		367			422			713

*	The Earned Premium includes all lines of business. The 2010 year is estimated to a full year.
**	The A-Priori is Milliman’s estimate from the 12/09 analysis. The 2010 loss ratio is equal to 2009.
***	The Projected Ultimate Loss for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

USA
Exhibit A6

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods

	Paid		Incurred		Bornhuetter-		Selected		Gross
	Loss		Loss		Ferguson		Ultimate		Earned
Accident	Projection		Projection		Projection		Losses		Premium*
Year	($000s)		($000s)		($000s)		($000s)		($000s)
1989		1,257		1,257	xxx			1,257		3,867
1990		396		396	xxx			396		4,279
1991		786		786	xxx			786		7,226
1992		447		447	xxx			447		9,324
1993		1,395		1,395	xxx			1,395		11,767
1994		3,828		3,828	xxx			3,828		14,575
1995		2,706		2,706	xxx			2,706		15,835
1996		2,143		2,143	xxx			2,143		19,671
1997		3,297		3,297	xxx			3,297		21,881
1998		4,938		4,938	xxx			4,938		24,452
1999		5,150		5,150	xxx			5,150		21,905
2000		4,678		4,673	xxx			4,673		13,873
2001		2,136		2,134	xxx			2,132		8,961
2002		287		279	xxx			279		6,947
2003		369		354	xxx			354		4,434
2004		306		286	xxx			286		3,750
2005		371		342	xxx			371		3,579
2006		235		258	xxx			258		3,609
2007		200		210	xxx			200		3,631
2008		313		245		367		367		3,656
2009		211		119		422		422		3,595
2010		3,995		1,298		713		713		2,601
Total at 9/30/10		39,444		36,541				36,398		213,418

* The Earned Premium includes all lines of business.

Milliman

USA
Exhibit A7

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Losses ($000s)

	Selected		Incurred		Paid		Case
Accident	Ultimate		Losses		Losses		Outstanding				Total
Year	Losses		@9/30/10		@9/30/10		@9/30/10		IBNR		Outstanding
1989		1,257		1,257		1,257		0		0		0
1990		396		396		396		0		0		0
1991		786		786		786		0		0		0
1992		447		447		447		0		0		0
1993		1,395		1,395		1,395		0		0		0
1994		3,828		3,828		3,828		0		0		0
1995		2,706		2,706		2,706		0		0		0
1996		2,143		2,143		2,143		0		0		0
1997		3,297		3,297		3,297		0		0		0
1998		4,938		4,938		4,938		0		0		0
1999		5,150		5,150		5,150		0		0		0
2000		4,673		4,673		4,673		0		0		0
2001		2,132		2,132		2,132		0		0		0
2002		279		271		271		0		8		8
2003		354		341		341		0		13		13
2004		286		272		272		0		14		14
2005		371		318		318		0		53		53
2006		258		231		191		40		27		67
2007		200		176		145		31		24		55
2008		367		180		177		3		187		190
2009		422		61		61		0		361		361
2010		713		398		336		62		315		377
Total at 9/30/10		36,398		35,396		35,260		136		1,002		1,138

Milliman

USA
Exhibit A8

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE ($000s)
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168
1989		27		67		86		96		104		107		108		108		79		79		79		79		79		79
1990		23		41		41		41		41		41		41		41		41		41		41		41		41		41
1991		22		42		51		58		59		59		60		60		60		60		60		60		60		60
1992		11		51		90		123		130		136		137		146		155		155		155		155		155		156
1993		45		176		375		462		445		491		487		489		490		498		498		498		498		498
1994		172		378		435		411		371		354		418		429		429		429		429		429		429		429
1995		223		343		416		476		495		478		478		478		478		478		478		478		482		483
1996		63		269		397		555		646		800		826		836		838		838		838		838		838		838
1997		156		347		378		434		480		486		516		518		520		522		526		526		526		526
1998		273		564		725		815		871		915		952		968		978		979		980		982		984
1999		159		495		810		908		1,016		1,108		1,169		1,171		1,180		1,187		1,192		1,193
2000		100		297		388		465		542		552		563		563		563		563		563
2001		17		52		88		95		158		190		213		246		249		250
2002		9		47		73		106		120		125		132		133		134
2003		3		18		42		51		52		54		54		54
2004		2		32		43		45		47		51		59
2005		18		53		62		74		77		81
2006		21		42		51		53		57
2007		17		24		34		67
2008		15		45		61
2009		11		27
2010		1
Last diagonal is as of 9/30/10.
Accident	Paid ALAE Development Factors
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180
1989		2.481		1.284		1.116		1.083		1.029		1.009		1.000		0.731		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.783		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.909		1.214		1.137		1.017		1.000		1.017		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		4.636		1.765		1.367		1.057		1.046		1.007		1.066		1.062		1.000		1.000		1.000		1.000		1.006		1.000
1993		3.911		2.131		1.232		0.963		1.103		0.992		1.004		1.002		1.016		1.000		1.000		1.000		1.000		1.000
1994		2.198		1.151		0.945		0.903		0.954		1.181		1.026		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		1.538		1.213		1.144		1.040		0.966		1.000		1.000		1.000		1.000		1.000		1.000		1.008		1.002		1.000
1996		4.270		1.476		1.398		1.164		1.238		1.033		1.012		1.002		1.000		1.000		1.000		1.000		1.000		1.000
1997		2.224		1.089		1.148		1.106		1.013		1.062		1.004		1.004		1.004		1.008		1.000		1.000		1.000
1998		2.066		1.285		1.124		1.069		1.051		1.040		1.017		1.010		1.001		1.001		1.002		1.003
1999		3.113		1.636		1.121		1.119		1.091		1.055		1.002		1.008		1.006		1.004		1.001
2000		2.970		1.306		1.198		1.166		1.018		1.020		1.000		1.000		1.000		1.000
2001		3.059		1.692		1.080		1.663		1.203		1.121		1.155		1.012		1.005
2002		5.222		1.553		1.452		1.132		1.042		1.056		1.008		1.010
2003		6.000		2.333		1.214		1.020		1.038		1.000		1.000
2004		16.000		1.344		1.047		1.044		1.085		1.214
2005		2.944		1.170		1.194		1.041		1.070
2006		2.000		1.214		1.039		1.102
2007		1.412		1.417		2.470
2008		3.000		1.500
2009		3.310
Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		3.621		1.439		1.233		1.094		1.056		1.050		1.020		0.989		1.002		1.001		1.000		1.001		1.001		1.000
Average x H/L		3.086		1.413		1.177		1.070		1.050		1.043		1.011		1.004		1.001		1.001		1.000		1.000		1.000		1.000
Avg L5 x H/L		2.648		1.325		1.151		1.062		1.066		1.066		1.003		1.009		1.003		1.002		1.000		1.001		1.000		1.000
Wtd Average		2.465		1.375		1.167		1.084		1.066		1.045		1.014		1.001		1.003		1.002		1.001		1.002		1.001		1.000
Wtd Avg L5		2.444		1.314		1.323		1.077		1.107		1.053		1.017		1.008		1.003		1.002		1.001		1.002		1.000		1.000
WSC Surety 9/10		5.059		1.846		1.333		1.176		1.109		1.060		1.042		1.047		1.029		1.013		1.006		1.004		1.004		1.004
Sel for 01 & Prior		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.003		1.002		1.001		1.001		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.005		1.003		1.001		1.000		1.000
Sel for 02 & Subs		5.059		1.846		1.333		1.176		1.109		1.060		1.042		1.047		1.029		1.013		1.006		1.004		1.004		1.004
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		33.662		5.940		2.501		1.730		1.426		1.266		1.181		1.129		1.079		1.044		1.027		1.020		1.015		1.011

Milliman

USA
Exhibit A9

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Projection

	(1)		(2)		(3)
			Cumulative		[(1)x(2)]
	Paid		Paid ALAE		Projected
	ALAE		Development		Ultimate
Accident	($000s)		Factors		ALAE ($000s)
Year	@9/30/10		9/30/10-Ult		@9/30/10
1989		79		1.000		79
1990		41		1.000		41
1991		60		1.000		60
1992		156		1.000		156
1993		498		1.000		498
1994		429		1.000		429
1995		483		1.000		483
1996		838		1.000		838
1997		526		1.000		526
1998		984		1.000		984
1999		1,193		1.001		1,194
2000		563		1.003		565
2001		250		1.005		251
2002		134		1.079		145
2003		54		1.129		61
2004		59		1.181		70
2005		81		1.266		103
2006		57		1.426		81
2007		67		1.730		116
2008		61		2.501		153
2009		27		5.940		160
2010		1		33.662		25
Total		6,641				7,018

Note: The 9-Ult Cumulative ALAE Development Factor was interpolated using curvefitting methods.

The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

USA
Exhibit A10

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Accident	Paid ALAE/Paid Loss + 1
Year	12		24		36		48		60		72		84		96		108		120		132		144		156		168
1989		1.026		1.052		1.063		1.070		1.076		1.080		1.084		1.086		1.063		1.063		1.063		1.063		1.063		1.063
1990		1.082		1.109		1.104		1.104		1.104		1.104		1.104		1.104		1.104		1.104		1.104		1.104		1.104		1.104
1991		1.038		1.055		1.066		1.074		1.075		1.075		1.076		1.076		1.076		1.076		1.076		1.076		1.076		1.076
1992		1.423		1.125		1.190		1.273		1.294		1.308		1.310		1.330		1.347		1.347		1.347		1.347		1.347		1.349
1993		1.126		1.150		1.291		1.332		1.320		1.354		1.361		1.363		1.364		1.367		1.357		1.357		1.357		1.357
1994		1.079		1.115		1.114		1.102		1.095		1.091		1.108		1.112		1.112		1.112		1.112		1.112		1.112		1.112
1995		1.142		1.123		1.145		1.171		1.179		1.175		1.175		1.176		1.175		1.176		1.176		1.176		1.178		1.178
1996		1.054		1.156		1.223		1.311		1.359		1.381		1.382		1.388		1.391		1.391		1.391		1.391		1.391		1.391
1997		1.097		1.108		1.108		1.123		1.138		1.139		1.154		1.154		1.157		1.158		1.159		1.159		1.160		1.160
1998		1.108		1.124		1.148		1.173		1.172		1.173		1.181		1.189		1.195		1.198		1.198		1.199		1.199
1999		1.131		1.133		1.176		1.178		1.201		1.207		1.221		1.223		1.227		1.230		1.231		1.232
2000		1.066		1.097		1.099		1.097		1.114		1.116		1.120		1.120		1.120		1.120		1.120
2001		1.015		1.024		1.040		1.043		1.073		1.088		1.100		1.115		1.117		1.117
2002		1.257		1.540		1.372		1.433		1.498		1.530		1.506		1.510		1.494
2003		1.150		1.128		1.219		1.180		1.160		1.158		1.159		1.158
2004		1.143		1.171		1.194		1.192		1.180		1.188		1.217
2005		1.240		1.353		1.244		1.249		1.250		1.255
2006		2.050		1.416		1.349		1.294		1.298
2007		N/A		1.312		1.306		1.462
2008		1.577		1.464		1.345
2009		1.239		1.443
2010		1.003
Last diagonal is as of 9/30/10.
Accident	Paid ALAE/Paid Loss + 1 Development Factors
Year	12 - 24		24 - 36		36 - 48		48 - 60		60 - 72		72 - 84		84 - 96		96 - 108		108 - 120		120 - 132		132 - 144		144 - 156		156 - 168		168 - 180
1989		1.025		1.011		1.007		1.005		1.003		1.004		1.002		0.979		1.000		1.000		1.000		1.000		1.000		1.000
1990		1.025		0.995		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1991		1.017		1.010		1.008		1.001		1.000		1.001		1.000		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1992		0.790		1.058		1.069		1.017		1.010		1.002		1.016		1.012		1.000		1.000		1.000		1.000		1.002		1.000
1993		1.021		1.123		1.031		0.991		1.026		1.005		1.002		1.001		1.002		0.992		1.000		1.000		1.000		1.000
1994		1.033		0.999		0.989		0.994		0.996		1.015		1.003		1.000		1.000		1.000		1.000		1.000		1.000		1.000
1995		0.983		1.020		1.023		1.007		0.996		1.000		1.001		1.000		1.000		1.000		1.000		1.002		1.000		1.000
1996		1.096		1.058		1.071		1.037		1.016		1.001		1.004		1.002		1.000		1.000		1.000		1.000		1.000		1.000
1997		1.010		1.001		1.013		1.013		1.001		1.013		1.001		1.002		1.001		1.001		1.000		1.001		1.000
1998		1.015		1.021		1.022		0.999		1.001		1.007		1.006		1.005		1.003		1.000		1.000		1.000
1999		1.002		1.037		1.002		1.020		1.005		1.012		1.002		1.003		1.003		1.001		1.000
2000		1.029		1.002		0.998		1.016		1.002		1.004		1.000		1.000		1.000		1.000
2001		1.009		1.016		1.003		1.029		1.014		1.011		1.014		1.001		1.001
2002		1.225		0.891		1.044		1.046		1.021		0.984		1.003		0.987
2003		0.981		1.081		0.968		0.984		0.998		1.000		0.999
2004		1.025		1.019		0.999		0.990		1.006		1.034
2005		1.091		0.919		1.004		1.001		1.005
2006		0.691		0.953		0.959		1.004
2007		N/A		0.996		1.171
2008		0.928		0.896
2009		1.246
Last diagonal is based on an extrapolation of 9/30/10 data to 12/31/10.
Average		1.012		1.005		1.020		1.008		1.006		1.006		1.003		0.999		1.001		1.000		1.000		1.000		1.000		1.000
Average x H/L		1.017		1.005		1.015		1.008		1.005		1.005		1.003		1.000		1.001		1.000		1.000		1.000		1.000		1.000
Avg L5 x H/L		1.015		0.956		0.990		0.998		1.009		1.005		1.001		1.001		1.001		1.000		1.000		1.000		1.000		1.000
WSC Surety 9/10		1.022		1.023		1.010		1.008		1.004		1.003		1.002		1.003		1.001		1.001		1.001		1.000		1.000		1.001
Sel for 01 & Prior		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.001		1.001		1.000		1.000		1.000		1.000
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		N/A		1.001		1.000		1.000		1.000		1.000
Sel for 02 & Subs		1.022		1.023		1.010		1.008		1.004		1.003		1.002		1.003		1.001		1.001		1.001		1.000		1.000		1.001
	9-Ult		21-Ult		33-Ult		45-Ult		57-Ult		69-Ult		81-Ult		93-Ult		105-Ult		117-Ult		129-Ult		141-Ult		153-Ult		165-Ult
Sep Cumulatives		1.107		1.064		1.040		1.027		1.018		1.013		1.010		1.008		1.005		1.003		1.002		1.001		1.001		1.001

Milliman

USA
Exhibit A11

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Projection of Ultimate Ratio of Paid ALAE to Paid Loss

	(1)	(2)	(3)
		Cumulative	[(1)x(2)]
		Ratio	Projected
		Development	Ultimate
Accident	Ratio	Factors	Ratio
Year	@9/30/10	9/30/10-Ult	@9/30/10
1989	1.063	1.000	1.063
1990	1.104	1.000	1.104
1991	1.076	1.000	1.076
1992	1.349	1.000	1.349
1993	1.357	1.000	1.357
1994	1.112	1.000	1.112
1995	1.178	1.000	1.178
1996	1.391	1.000	1.391
1997	1.160	1.000	1.160
1998	1.199	1.000	1.199
1999	1.232	1.000	1.232
2000	1.120	1.000	1.120
2001	1.117	1.001	1.118
2002	1.494	1.005	1.502
2003	1.158	1.008	1.168
2004	1.217	1.010	1.229
2005	1.255	1.013	1.271
2006	1.298	1.018	1.322
2007	1.462	1.027	1.502
2008	1.345	1.040	1.398
2009	1.443	1.064	1.535
2010	1.003	1.107	1.110

Note: The 9-Ult Cumulative Ratio Development Factor was interpolated using curve fitting methods.

Milliman

USA
Exhibit A12

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Paid ALAE Bornhuetter — Ferguson Projection ($000s)

	2006			2007			2008			2009			2010
1) Gross Earned Premium at 9/10*		3,609			3,631			3,656			3,595			3,468
2) A-priori Ultimate ALAE Ratio		6.4	%		9.0	%		10.4	%		10.6	%		10.6	%
3) A-priori Ultimate ALAE at 9/10**		230			325			379			380			367
(1) x (2)
4) % Unpaid (based on Paid ALAE CDF)		0.299			0.422			0.600			0.832			0.970
[ 1 - 1 / CDF ]
5) Projected Unpaid ALAE at 9/10		69			137			227			316			356
(3) x (4)
6) Actual Paid ALAE at 9/10		57			67			61			27			1
7) Indicated Ultimate ALAE***		126			204			288			343			268
[ (5) + (6) ] * 9 / 12 for 2010

*	The Earned Premium includes all lines of business. The 2010 year is estimated to a full year.
**	The A-Priori is Milliman’s estimate from the 12/09 analysis. The 2010 ALAE ratio is equal to 2009.
***	The Projected Ultimate ALAE for 2010 is multiplied by 9/12 to reflect exposure as of 9/30/10.

Milliman

USA
Exhibit A13

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Projection Methods for ALAE

			Selected						Bornhuetter-		Selected		Ultimate
	Paid ALAE		Ultimate		Paid to Paid		Paid ALAE		Ferguson		Ultimate		ALAE to
Accident	to Paid		Losses		Projection		Projection		Projection		ALAE*		Ultimate
Year	Loss Ratio		($000s)		($000s)		($000s)		($000s)		($000s)		Loss Ratio
1989		0.063		1,257		79		79	xxx			79		0.0628
1990		0.104		396		41		41	xxx			41		0.1035
1991		0.076		786		60		60	xxx			60		0.0763
1992		0.349		447		156		156	xxx			156		0.3490
1993		0.357		1,395		498		498	xxx			498		0.3570
1994		0.112		3,828		429		429	xxx			429		0.1121
1995		0.178		2,706		482		483	xxx			483		0.1785
1996		0.391		2,143		838		838	xxx			838		0.3910
1997		0.160		3,297		528		526	xxx			526		0.1595
1998		0.199		4,938		983		984	xxx			984		0.1993
1999		0.232		5,150		1,195		1,194	xxx			1,193		0.2317
2000		0.120		4,673		561		565	xxx			563		0.1205
2001		0.118		2,132		252		251	xxx			250		0.1173
2002		0.502		279		140		145	xxx			145		0.5197
2003		0.168		354		59		61	xxx			61		0.1723
2004		0.229		286		65		70	xxx			70		0.2448
2005		0.271		371		101		103	xxx			103		0.2776
2006		0.322		258		83		81		126		104		0.4031
2007		0.502		200		100		116		204		160		0.8000
2008		0.398		367		146		153		288		221		0.6022
2009		0.535		422		226		160		343		252		0.5972
2010		0.110		713		78		25		268		268		0.3759
Total at 9/30/10				36,398		7,100		7,018				7,484		0.2056

Milliman

USA
Exhibit A14

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Selected		Paid
Accident	Ultimate		ALAE		Unpaid
Year	ALAE		@9/30/10		ALAE
1989		79		79		0
1990		41		41		0
1991		60		60		0
1992		156		156		0
1993		498		498		0
1994		429		429		0
1995		483		483		0
1996		838		838		0
1997		526		526		0
1998		984		984		0
1999		1,193		1,193		0
2000		563		563		0
2001		250		250		0
2002		145		134		11
2003		61		54		7
2004		70		59		11
2005		103		81		22
2006		104		57		47
2007		160		67		93
2008		221		61		160
2009		252		27		225
2010		268		1		267
Total at 9/30/10		7,484		6,641		843

Milliman

USA

Exhibit A15

UNIVERSAL SURETY OF AMERICA
GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Loss & ALAE ($000s)

	Selected		Incurred		Paid		Case
Accident	Ultimate		Loss & ALAE		Loss & ALAE		Outstanding				Total
Year	Loss & ALAE		@1/1/00		@9/30/10		@9/30/10		IBNR		Outstanding
1989		1,336		1,336		1,336		0		0		0
1990		437		437		437		0		0		0
1991		846		846		846		0		0		0
1992		603		603		603		0		0		0
1993		1,893		1,893		1,893		0		0		0
1994		4,257		4,257		4,257		0		0		0
1995		3,189		3,189		3,189		0		0		0
1996		2,981		2,981		2,981		0		0		0
1997		3,823		3,823		3,823		0		0		0
1998		5,922		5,922		5,922		0		0		0
1999		6,343		6,343		6,343		0		0		0
2000		5,236		5,236		5,236		0		0		0
2001		2,382		2,382		2,382		0		0		0
2002		424		405		405		0		19		19
2003		415		395		395		0		20		20
2004		356		331		331		0		25		25
2005		474		399		399		0		75		75
2006		362		288		248		40		74		114
2007		360		243		212		31		117		148
2008		588		241		238		3		347		350
2009		674		88		88		0		586		586
2010		981		399		337		62		582		644
Total at 9/30/10		43,882		42,037		41,901		136		1,845		1,981

Milliman

USA
Exhibit A16

UNIVERSAL SURETY OF AMERICA
NET SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Losses ($000s)

	Selected		Incurred		Paid		Case
Accident	Ultimate		Losses		Losses		Outstanding				Total
Year	Losses		@9/30/10		@9/30/10		@9/30/10		IBNR		Outstanding
1989		500		500		500		0		0		0
1990		163		163		163		0		0		0
1991		236		236		236		0		0		0
1992		167		167		167		0		0		0
1993		516		516		516		0		0		0
1994		1,017		1,017		1,017		0		0		0
1995		1,012		1,012		1,012		0		0		0
1996		986		986		986		0		0		0
1997		1,514		1,514		1,514		0		0		0
1998		2,358		2,358		2,358		0		0		0
1999		5,040		5,040		5,040		0		0		0
2000		4,673		4,673		4,673		0		0		0
2001		2,132		2,132		2,132		0		0		0
2002		279		271		271		0		8		8
2003		354		341		341		0		13		13
2004		286		272		272		0		14		14
2005		371		318		318		0		53		53
2006		258		231		191		40		27		67
2007		200		176		145		31		24		55
2008		367		180		177		3		187		190
2009		422		61		61		0		361		361
2010		713		398		336		62		315		377
Total at 9/30/10		23,564		22,562		22,426		136		1,002		1,138

Milliman

USA
Exhibit A17

UNIVERSAL SURETY OF AMERICA
NET SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Ultimate ALAE ($000s)

	Selected		Paid
Accident	Ultimate		ALAE		Unpaid
Year	ALAE		@9/30/10		ALAE
1989		64		64		0
1990		31		31		0
1991		50		50		0
1992		125		125		0
1993		203		203		0
1994		222		222		0
1995		234		234		0
1996		508		508		0
1997		238		238		0
1998		605		605		0
1999		1,109		1,109		0
2000		547		547		0
2001		250		250		0
2002		145		134		11
2003		61		54		7
2004		70		59		11
2005		103		81		22
2006		104		57		47
2007		160		67		93
2008		221		61		160
2009		252		27		225
2010		268		1		267
Total at 9/30/10		5,570		4,727		843

Milliman

USA
Exhibit A18

UNIVERSAL SURETY OF AMERICA
NET SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 9/30/10

Summary of Loss & ALAE ($000s)

	Selected		Incurred		Paid		Case
Accident	Ultimate		Loss & ALAE		Loss & ALAE		Outstanding				Total
Year	Loss & ALAE		@1/1/00		@9/30/10		@9/30/10		IBNR		Outstanding
1989		564		564		564		0		0		0
1990		194		194		194		0		0		0
1991		286		286		286		0		0		0
1992		292		292		292		0		0		0
1993		719		719		719		0		0		0
1994		1,239		1,239		1,239		0		0		0
1995		1,246		1,246		1,246		0		0		0
1996		1,494		1,494		1,494		0		0		0
1997		1,752		1,752		1,752		0		0		0
1998		2,963		2,963		2,963		0		0		0
1999		6,149		6,149		6,149		0		0		0
2000		5,220		5,220		5,220		0		0		0
2001		2,382		2,382		2,382		0		0		0
2002		424		405		405		0		19		19
2003		415		395		395		0		20		20
2004		356		331		331		0		25		25
2005		474		399		399		0		75		75
2006		362		288		248		40		74		114
2007		360		243		212		31		117		148
2008		588		241		238		3		347		350
2009		674		88		88		0		586		586
2010		981		399		337		62		582		644
Total at 9/30/10		29,134		27,289		27,153		136		1,845		1,981

Milliman

USA

Exhibit B1

UNIVERSAL SURETY OF AMERICA

GROSS SURETY
INCURRED LOSS B-F PROJECTION
NET OF SALVAGE & SUBROGATION
($000s)

	Selected						Interpolated							Indicated		Selected
	Ultimate		Incurred		Implicit		Percent					Incurred		Ultimate		Ultimate		Paid		Unpaid
Accident	Loss*		Loss		Reporting		Unreported			Projected		Loss		Loss		Loss		Loss		Loss
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unreported		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		1,257		1,257		1.000		0.0	%		0		1,257		1,257		1,257		1,257		0
1990		396		396		1.000		0.0	%		0		396		396		396		396		0
1991		786		786		1.000		0.0	%		0		786		786		786		786		0
1992		447		447		1.000		0.0	%		0		447		447		447		447		0
1993		1,395		1,395		1.000		0.0	%		0		1,395		1,395		1,395		1,395		0
1994		3,828		3,828		1.000		0.0	%		0		3,828		3,828		3,828		3,828		0
1995		2,706		2,706		1.000		0.0	%		0		2,706		2,706		2,706		2,706		0
1996		2,143		2,143		1.000		0.0	%		0		2,143		2,143		2,143		2,143		0
1997		3,297		3,297		1.000		0.0	%		0		3,297		3,297		3,297		3,297		0
1998		4,938		4,938		1.000		0.0	%		0		4,938		4,938		4,938		4,938		0
1999		5,150		5,150		1.000		0.0	%		0		5,150		5,150		5,150		5,150		0
2000		4,673		4,673		1.000		0.0	%		0		4,673		4,673		4,673		4,673		0
2001		2,132		2,132		1.000		0.0	%		0		2,132		2,132		2,132		2,132		0
2002		279		271		0.971		2.2	%		6		271		277		277		271		6
2003		354		341		0.963		3.5	%		12		341		353		353		341		12
2004		286		272		0.951		4.6	%		13		271		284		284		271		13
2005		371		318		0.857		11.9	%		44		318		362		362		318		44
2006		258		231		0.895		11.4	%		29		230		259		259		190		69
2007		200		176		0.880		11.6	%		23		181		204		204		160		44
2008		367		180		0.490		41.2	%		151		198		349		358		187		171
2009		422		61		0.145		76.9	%		325		63		388		405		63		342
2010		947		398		0.420		64.9	%		615		430		1,045		947		378		569
Total		36,632		35,396							1,218		35,451		36,669		36,597		35,327		1,270

* The 2010 year has been adjusted to a full year basis.

Milliman

USA
Exhibit B2

UNIVERSAL SURETY OF AMERICA

GROSS SURETY PAID
ALAE B-F PROJECTION
($000s)

	Selected						Interpolated							Indicated		Selected
	Ultimate		Paid		Implicit		Percent					Paid		Ultimate		Ultimate		Unpaid
Accident	ALAE*		ALAE		Payment		Unpaid			Projected		ALAE		ALAE		ALAE		ALAE
Year	@9/30/10		@9/30/10		Pattern		@12/31/10			Unpaid		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		79		79		1.000		0.0	%		0		79		79		79		0
1990		41		41		1.000		0.0	%		0		41		41		41		0
1991		60		60		1.000		0.0	%		0		60		60		60		0
1992		156		156		1.000		0.0	%		0		156		156		156		0
1993		498		498		1.000		0.0	%		0		498		498		498		0
1994		429		429		1.000		0.0	%		0		429		429		429		0
1995		483		483		1.000		0.0	%		0		483		483		483		0
1996		838		838		1.000		0.0	%		0		838		838		838		0
1997		526		526		1.000		0.0	%		0		526		526		526		0
1998		984		984		1.000		0.0	%		0		984		984		984		0
1999		1,193		1,193		1.000		0.0	%		0		1,195		1,195		1,195		0
2000		563		563		1.000		0.0	%		0		563		563		563		0
2001		250		250		1.000		0.0	%		0		250		250		250		0
2002		145		134		0.924		5.7	%		8		134		142		142		8
2003		61		54		0.885		10.5	%		6		54		60		60		6
2004		70		59		0.843		14.7	%		10		61		71		71		10
2005		103		81		0.786		19.9	%		20		82		102		102		20
2006		104		57		0.548		39.2	%		41		57		98		98		41
2007		160		67		0.419		54.9	%		88		80		168		168		88
2008		221		61		0.276		68.8	%		152		64		216		219		155
2009		252		27		0.107		85.1	%		214		28		242		247		219
2010		356		1		0.003		97.1	%		346		1		347		356		355
Total		7,572		6,641							885		6,663		7,548		7,565		902

* The 2010 year has been adjusted to a full year basis.

Milliman

USA
Exhibit B3

UNIVERSAL SURETY OF AMERICA

GROSS SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 12/31/10
SUMMARY OF UNPAID LOSS & ALAE ($000s)

	Selected						Paid		Unpaid		IBNR
	Ult Loss		Paid		Paid		Loss &		Loss &		Loss &
Accident	& ALAE		Loss		ALAE		ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		1,336		1,257		79		1,336		0		0
1990		437		396		41		437		0		0
1991		846		786		60		846		0		0
1992		603		447		156		603		0		0
1993		1,893		1,395		498		1,893		0		0
1994		4,257		3,828		429		4,257		0		0
1995		3,189		2,706		483		3,189		0		0
1996		2,981		2,143		838		2,981		0		0
1997		3,823		3,297		526		3,823		0		0
1998		5,922		4,938		984		5,922		0		0
1999		6,345		5,150		1,195		6,345		0		0
2000		5,236		4,673		563		5,236		0		0
2001		2,382		2,132		250		2,382		0		0
2002		419		271		134		405		14		14
2003		413		341		54		395		18		18
2004		355		271		61		332		23		23
2005		464		318		82		400		64		64
2006		357		190		57		247		110		70
2007		372		160		80		240		132		111
2008		577		187		64		251		326		315
2009		652		63		28		91		561		561
2010		1,303		378		1		379		924		872
Total		44,162		35,327		6,663		41,990		2,172		2,048

Milliman

USA
Exhibit B4

UNIVERSAL SURETY OF AMERICA

NET SURETY
NET OF SALVAGE & SUBROGATION
EVALUATED AS OF 12/31/10
SUMMARY OF UNPAID LOSS & ALAE ($000s)

	Selected						Paid		Unpaid		IBNR
	Ult Loss		Paid		Paid		Loss &		Loss &		Loss &
Accident	& ALAE		Loss		ALAE		ALAE		ALAE		ALAE
Year	@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10		@12/31/10
1989		564		500		64		564		0		0
1990		194		163		31		194		0		0
1991		286		236		50		286		0		0
1992		292		167		125		292		0		0
1993		719		516		203		719		0		0
1994		1,239		1,017		222		1,239		0		0
1995		1,246		1,012		234		1,246		0		0
1996		1,494		986		508		1,494		0		0
1997		1,752		1,514		238		1,752		0		0
1998		2,963		2,358		605		2,963		0		0
1999		6,151		5,040		1,111		6,151		0		0
2000		5,220		4,673		547		5,220		0		0
2001		2,382		2,132		250		2,382		0		0
2002		419		271		134		405		14		14
2003		413		341		54		395		18		18
2004		355		271		61		332		23		23
2005		464		318		82		400		64		64
2006		357		190		57		247		110		70
2007		372		160		80		240		132		111
2008		577		187		64		251		326		315
2009		652		63		28		91		561		561
2010		1,303		378		1		379		924		872
Total		29,414		22,493		4,749		27,242		2,172		2,048

Milliman

USA
Exhibit C1

UNIVERSAL SURETY OF AMERICA

GROSS OF REINSURANCE
NET OF SALVAGE & SUBROGATION
DEVELOPMENT OF UNPAID ULAE ($000s)
EVALUATED AS OF DECEMBER 31, 2010

	(1)			(2)		(3)		(4)
								Selected
	Paid ULAE					Milliman		Unpaid
	to Paid Loss			Gross Case		Estimated		ULAE***
Line of Business	& ALAE*			Reserves		Gross IBNR**		@12/31/10
Reviewed		8.5	%		124		2,048		179
Non-Reviewed		8.5	%		8		428		37
Total					132		2,476		216

*	Based on the selected ratio for Western Surety Company
**	See Exhibit B3
***	(4) = (1) x (2) x 0.5 + (1) x (3)

Milliman