8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 11, 2008

MERCURY GENERAL CORPORATION

(Exact Name of Registrant as Specified in Charter)

California	001-12257	95-221-1612
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

4484 Wilshire Boulevard

Los Angeles, California 90010

(Address of Principal Executive Offices)

____________________

(323) 937-1060

(Registrant’s telephone number, including area code)

____________________

Not applicable

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

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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

[ ]Soliciting material pursuant to Rule 425 under the Exchange Act (17 CFR 240.14.a-12)

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

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

Item 2.02. Results of Operations and Financial Condition

The following information is furnished pursuant to Item 2.02, “Results of Operations and Financial Condition,” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.

On February 11, 2008, Mercury General Corporation issued a press release announcing its financial results for the fourth quarter and fiscal year ended December 31, 2007. A copy of the press release is attached hereto as Exhibit 99.1.

The information contained in this Current Report, including the exhibit, shall not be incorporated by reference into any filing of Mercury General Corporation, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits

         (d) Exhibits.

99.1 Press Release, dated February 11, 2008 issued by Mercury General Corporation, furnished pursuant to Item 2.02 of Form 8-K.

- 2 -

SIGNATURES

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

Date: February 11, 2008	MERCURY GENERAL CORPORATION
	By: /s/ Theodore Stalick
	Name: Theodore Stalick
	Its: Chief Financial Officer

- 3 -

Exhibit Index

Exhibit 99.1. Press Release, dated February 11, 2008, issued by Mercury General Corporation.

- 4 -

EX-99.1

  4484 Wilshire Boulevard Los Angeles, California 90010 (323) 937-1060 Fax (323) 857-7125

Press Release

FOR MORE INFORMATION, CONTACT:

Theodore Stalick, VP/CFO

(323) 937-1060

www.mercuryinsurance.com

For Release: February 11, 2008

Mercury General Corporation Announces Fourth Quarter Results

Increases Dividend 11.5%

Los Angeles, California…Mercury General Corporation (NYSE: MCY) reported today net income of $44.6 million ($0.81 per share-diluted) in the fourth quarter 2007 compared with $50.1 million ($0.91 per share-diluted) for the same period in 2006. For the year, net income was $237.8 million ($4.34 per share-diluted) compared with net income of $214.8 million ($3.92 per share-diluted) for the same period in 2006. Included in net income are net realized investment gains, net of tax, of $6.4 million ($0.12 per share-diluted) in the fourth quarter of 2007 compared with net realized investment gains, net of tax, of $1.3 million ($0.02 per share-diluted) for the same period in 2006, and net realized investment gains, net of tax, of $13.5 million ($0.25 per share-diluted) for the entire 2007 year compared with net realized investment gains, net of tax, of $10.0 million ($0.18 per share-diluted) for 2006. Net income in the fourth quarter of 2007 also includes approximately $23 million ($15 million after tax benefit or $0.27 per share-diluted) in losses resulting from the October 2007 Southern California fire storms.

Company-wide net premiums written were $699.9 million in the fourth quarter 2007, a 5.5% decrease over fourth quarter 2006 net premiums written of $740.7 million, and were approximately $3.0 billion for the year, a 2.1% decrease over the same period in 2006. California net premiums written were $547.8 million in the fourth quarter of 2007, a decrease of 1.9% over the same period in 2006, and were approximately $2.3 billion for the year, a 2.4% increase over the same period in 2006. Non-California net premiums written were $152.1 million in the fourth quarter of 2007, a 16.5% decrease over the same period in 2006, and were $677.6 million for the year, a decrease of 14.8% over the same period in 2006.

The Company’s combined ratio (GAAP basis) was 98.8% in the fourth quarter and 95.4% for the year compared with 96.5% and 95.0% for the same periods in 2006. The Southern California fire storms negatively impacted the combined ratio by 3.1% for the fourth quarter of 2007 and 0.8% for the entire year of 2007. Adverse development on prior accident years’ loss reserves was approximately $20 million for the year ended December 31 in both 2007 and 2006. For business produced in California, loss development on prior accident years’ loss reserves was approximately $26 million adverse and $15 million positive for the years ended December 31, 2007 and 2006, respectively. For business produced outside of California, development on prior accident years’ loss reserves was approximately $6 million positive and $35 million adverse for the years ended December 31, 2007 and 2006, respectively.

Net investment income of $36.8 million (after tax $33.2 million) in the fourth quarter of 2007 decreased by 4.8% over the same period in 2006. The after-tax yield on investment income was 3.8% on average assets of $3.5 billion (fixed maturities and equities at cost) for the quarter. This compares with an after-tax yield on investment income of 4.0% on average investments of $3.4 billion (fixed maturities and equities at cost) for the same period in 2006. Net investment income for the entire year of 2007 was $158.9 million (after tax $137.8 million), an increase of 5.2% over the same period in 2006. The after-tax yield on investment income was 4.0% on average assets of $3.5 billion (fixed maturities and equities at cost) for the year. This compares with an after-tax yield on investment income of 3.8% on average investments of $3.3 billion (fixed maturities and equities at cost) for the same period in 2006.

The Board of Directors declared a quarterly dividend of $0.58 per share, representing an 11.5% increase over the quarterly dividend amount paid in 2007. The dividend is to be paid on March 27, 2008 to shareholders of record on March 17, 2008. The Company’s book value per share at December 31, 2007 was $34.02.

Mercury General Corporation and its subsidiaries are a multiple line insurance organization offering predominantly personal automobile and homeowners insurance through a network of independent producers in many states. For more information, visit the Company’s website at www.mercuryinsurance.com. The Company will be hosting a conference call and webcast today at 10:00 A.M. Pacific time where management will discuss results and address questions. The teleconference and webcast can be accessed by calling (877) 807-1888 (USA), (706) 679-3827 (International) or by visiting www.mercuryinsurance.com. A replay of the call will be available beginning at 1:30 P.M. Pacific time and running through February 18, 2008. The replay telephone numbers are (800) 642-1687 (USA) or (706) 645-9291 (International). The conference ID# is 31139571. The replay will also be available on the Company’s website shortly following the call.

Page 2

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for certain forward-looking statements. The statements contained in this press release are forward-looking statements based on the Company’s current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those anticipated by the Company. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the Company) and are subject to change based upon various factors, including but not limited to the following risks and uncertainties: changes in the demand for the Company’s insurance products, inflation and in general economic conditions; the accuracy and adequacy of the Company’s pricing methodologies; adverse weather conditions or natural disasters in the markets served by the Company; market risks associated with the Company’s investment portfolio; uncertainties related to estimates, assumptions and projections generally; the possibility that actual loss experience may vary adversely from the actuarial estimates made to determine the Company’s loss reserves in general; the Company’s ability to obtain and the timing of regulatory approval for requested rate changes; legislation adverse to the automobile insurance industry or business generally that may be enacted in California or other states; the Company’s success in expanding its business in states outside of California; the Company’s ability to successfully complete its initiative to standardize its policies and procedures nationwide in all of its functional areas; the presence of competitors with greater financial resources and the impact of competitive pricing; changes in driving patterns and loss trends; acts of war and terrorist activities; court decisions and trends in litigation and health care and auto repair costs and marketing efforts; and various legal, regulatory and litigation risks. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainties, see the Company’s filings with the Securities and Exchange Commission.

Page 3

Mercury General Corporation

Information Regarding Non-GAAP Measures

The Company has presented information within this document containing operating measures which in management’s opinion provide investors with useful, industry specific information to help them evaluate, and perform meaningful comparisons of, the Company’s performance, but that may not be presented in accordance with Generally Accepted Accounting Principles (“GAAP”). These measures are not intended to replace, and should be read in conjunction with, the GAAP financial results. The Company has reconciled these measures with the most directly comparable GAAP measure in the supplemental schedule entitled, “Summary of Operating Results.”

Net premiums written represents the premiums charged on policies issued during a fiscal period. Net premiums earned, the most directly comparable GAAP measure, represents the portion of premiums written that is recognized as income in the financial statements for the periods presented and earned on a pro-rata basis over the term of the policies. Net premiums written is meant as supplemental information and is not intended to replace Net premiums earned. It should be read in conjunction with the GAAP financial results.

Paid losses and loss adjustment expenses is the portion of Incurred losses and loss adjustment expenses, the most directly comparable GAAP measure, excluding the effects of changes in the loss reserve accounts. Paid losses and loss adjustment expenses is meant as supplemental information and is not intended to replace Incurred losses and loss adjustment expenses. It should be read in conjunction with the GAAP financial results.

Page 4

Mercury General Corporation and Subsidiaries

Summary of Operating Results

(000's except per-share amounts and ratios)

(unaudited)

	Quarter Ended December 31,						Twelve Months Ended December 31,
	2007			2006			2007			2006
Net premiums written	$	699,898		$	740,742		$	2,982,024		$	3,044,774
Net premiums earned		735,251			753,871			2,993,877			2,997,023
Paid losses and loss adjustment expenses		516,316			495,573			2,019,579			1,944,887
Incurred losses and loss adjustment expenses		524,716			521,021			2,036,644			2,021,646
Net investment income		36,755			38,597			158,911			151,099
Net realized investment gains, net of tax		6,378			1,339			13,525			10,033
Net income	$	44,592		$	50,132		$	237,832		$	214,817
Basic average shares outstanding		54,723			54,669			54,704			54,651
Diluted average shares outstanding		54,827			54,820			54,829			54,786
Basic Per Share Data
Net income	$	0.81		$	0.92		$	4.35		$	3.93
Net realized investment gains, net of tax	$	0.12		$	0.02		$	0.25		$	0.18
Incurred losses from Southern California fire storms, net of tax benefit	$	(0.27	)		N/A		$	(0.27	)		N/A
Diluted Per Share Data
Net income	$	0.81		$	0.91		$	4.34		$	3.92
Net realized investment gains, net of tax	$	0.12		$	0.02		$	0.25		$	0.18
Incurred losses from Southern California fire storms, net of tax benefit	$	(0.27	)		N/A		$	(0.27	)		N/A
Operating Ratios-GAAP (a) Basis
Loss ratio		71.4	%		69.1	%		68.0	%		67.5	%
Expense ratio		27.4	%		27.4	%		27.4	%		27.5	%
Combined ratio		98.8	%		96.5	%		95.4	%		95.0	%
Impact of California fire storms on loss ratio		3.1	%		N/A			0.8	%		N/A
Reconciliations of Operating Measures to Comparable GAAP (a) Measures
Net premiums written	$	699,898		$	740,742		$	2,982,024		$	3,044,774
Increase in unearned premiums		35,353			13,129			11,853			(47,751	)
Net premiums earned	$	735,251		$	753,871		$	2,993,877		$	2,997,023
Paid losses and loss adjustment expenses	$	516,316		$	495,573		$	2,019,579		$	1,944,887
Increase in net loss and loss adjustment expense reserves		8,400			25,448			17,065			76,759
Incurred losses and loss adjustment expenses	$	524,716		$	521,021		$	2,036,644		$	2,021,646

Page 5

Mercury General Corporation and Subsidiaries
Other Supplemental Information
(000's except ratios)
(unaudited)
	Quarter Ended December 31,						Twelve Months Ended December 31,
	2007			2006			2007			2006
California Operations (1)
Net premiums written	$	547,818		$	558,548		$	2,304,412		$	2,249,737
Net premiums earned		571,165			562,992			2,302,383			2,210,801
Loss ratio		71.9	%		66.4	%		66.3	%		63.9	%
Expense ratio		26.4	%		25.8	%		26.3	%		26.4	%
Combined ratio		98.3	%		92.2	%		92.6	%		90.3	%
Non-California Operations (2)
Net premiums written	$	152,080		$	182,194		$	677,612		$	795,037
Net premiums earned		164,086			190,879			691,494			786,222
Loss ratio		69.3	%		77.0	%		73.7	%		77.6	%
Expense ratio		31.1	%		32.1	%		30.7	%		30.7	%
Combined ratio		100.4	%		109.1	%		104.4	%		108.3	%
	At December 31,
Policies-in-force (000's)		2007			2006
California personal auto		1,112			1,145
California commercial auto		18			20
Non-California personal auto		284			338
California homeowners		269			261
Florida homeowners		12			14

Notes:

All ratios are calculated on GAAP basis.

(1) Includes homeowners, auto, commercial property and other immaterial California business lines

(2) Includes all states except California

Page 6

Mercury General Corporation and Subsidiaries
Condensed Balance Sheets and Other Information
(000's except per-share amounts)
(unaudited)
	December 31, 2007		December 31, 2006
Investments:
Fixed maturities available for sale, at fair value (amortized cost $2,860,455 in 2007 and $2,851,715 in 2006)
(includes hybrid financial instruments: $31,770 in 2007)	$	2,887,760	$	2,898,987
Equity securities available for sale, at fair value (cost $317,869 in 2007 and $258,310 in 2006)		413,123		318,449
Equity securities trading, at fair value (cost $13,126 in 2007)		15,114		-
Short-term investments, at cost, which approximates fair value		272,678		282,302
Total investments		3,588,675		3,499,738
Net receivables		367,686		372,777
Deferred policy acquisition costs		209,805		209,783
Other assets		248,330		218,764
Total assets	$	4,414,496	$	4,301,062
Losses and loss adjustment expenses	$	1,103,915	$	1,088,822
Unearned premiums		938,370		950,344
Notes payable		138,562		141,554
Other liabilities		371,651		396,212
Shareholders' equity		1,861,998		1,724,130
Total liabilities and shareholders' equity	$	4,414,496	$	4,301,062
Common stock-shares outstanding		54,730		54,670
Book value per share	$	34.02	$	31.54
Statutory surplus	$	1.7 billion	$	1.6 billion
Portfolio duration		4.4 years		4.0 years

Page 7