EXHIBIT 99.1

SEARCHABLE TEXT of Slide Show Follows:

Slide # 01

HALLMARK
FINANCIAL
SERVICES, INC.

New York Society of Security Analysts

Annual Insurance Industry Conference

February 2007

Slide # 02

Forward-Looking Statements

This presentation includes certain forward-looking statements regarding our expected performance for future periods and actual results for such periods may materially differ. These statements are intended as "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties, including risks of changing market conditions in the overall economy and the industry, consumer demand, regulatory environment, current and future litigation, the success of new products and acquisitions and the success of our strategies and other factors detailed from time to time in our annual and other reports filed with the Securities and Exchange Commission.

Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, our business and growth strategies, our performance goals, our projected financial condition and operating results, our understanding of our competition, industry and market trends, the impact of technology on our products, operations and business, and any other statements or assumptions that are not historical facts.

More information about these and other factors that potentially could affect our financial results is included in the Registration Statement on Form S-1 (as amended) in connection with the recent initial public offering of our common stock and in our other public filings filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance upon these forward-looking statements that speak only as to the date of this presentation. All forward-looking statements included in this presentation are based upon information presently available, and the Company assumes no obligation to update any forward-looking statements.

Slide # 03

Overview

Mark Schwarz

Executive Chairman

Slide # 04

Who We Are

*	Diversified specialty property/casualty insurer
*	Market, distribute, underwrite and service personal and commercial insurance in selected markets
	*	Focused on short-tailed lines in underserved sectors
*	Four Operating Units:
	*	HGA Operating Unit: Standard commercial insurance
	*	TGA Operating Unit: Excess & surplus lines insurance
	*	Phoenix Operating Unit: Non-standard personal auto
	*	Aerospace Operating Unit: General aviation insurance
*	"A-" (Excellent) A.M. Best Financial Strength Rating

Slide # 05

Our History

1990	Legacy insurance operations begin, focusing on Texas non-standard auto market
2000	Newcastle Partners makes first investment
2001	Mark Schwarz becomes Chairman
	Brings new direction, new management team
2002	Diversify into commercial lines with acquisition of Hallmark General Agency (HGA)
2003	Expand non-standard auto operations with acquisition of Phoenix Indemnity Ins. Co. ("PIIC")
2005	Capital plan to increase business retention and secure A.M. Best rating of "A-"
2006	Acquisition of TGA and Aerospace Operating Units and completed public offering of three million shares

Years colored in GOLD indicate Newcastle investment

Slide # 06

Our Philosophy

Create a Premier Specialty Insurer Focused on Underwriting Profitability and Long Term Growth of Shareholders Equity

* Build strong management team with interests aligned to shareholders

* Concentrate on specialty insurance niches

* Create well diversified business lines

* Selectively acquire well positioned companies with strong operating management

* Build strong balance sheet based on conservative investment, reinsurance and reserving practices

Slide # 07

Our Management Team

Name	Position	Industry Experience
Mark Schwarz	Executive Chairman	11
Mark Morrison	Chief Executive Officer	24
Jeff Passmore	Chief Accounting Officer	17
Kevin Kasitz	EVP Commercial Lines President - HGA	18
Brooks Davis	EVP Personal Lines President - Phoenix	12
Don Meyer	President - TGA	27
Curtis Donnell	President - Aerospace	37

Slide # 08

Business Strategy: Specialty/Niche Insurance

Property/Casualty Insurance Products:

* Underserved markets - limited competition

* Highly customized products to meet unique needs of insureds

* Low price sensitivity

* Low-severity and short-tailed

* Underwriting expertise critical

Operating Units:

* Strong relationships with agents and specialty brokers

* Tailored market strategies for each Unit

	Superior agent and customer service
Results:	Higher agent/customer retention
	Strong, consistent underwriting performance

Slide # 09

Culture Based on Underwriting

Goal: Generate an Underwriting Profit on All Business

• Emphasis on bottom-line profitability over top-line growth
• Underwriters' bonuses based on underwriting performance
• Underwriters' average experience is over 15 years
• Reinsurance used to manage earnings volatility & capital risk

Chart Net Combined Ratio (2001-Present)
Line Graph Hallmark & A.M. Best P & C

	2001	2002	2003	2004	2005	2006YTD
Hallmark Stat	115.3%	96.3%	101.1%	88.8%	93.1%	86.5%
A.M. Best P&C (2006E)	115.8%	107.3%	100.2%	98.5%	100.1%	94.0%

Prior to July 1, 2005, Underwriting

Results included Non-Standard Auto business only.

Slide # 10

Business Review

Mark Morrison

President & Chief Executive Officer

Slide # 11

HGA Operating Unit

Gross Premiums Produced
By Operating Unit

[Pie Chart]
HGA	32%
TGA	42%
Aerospace	10%
Phoenix	16%
[$219 million as of 9/06YTD]

Specialty:

• Small, low-hazard commercial package business
• Focused on rural and suburban markets

Agency Relationships:

• Long-standing relationships
• Selectively chosen group of 190 independent retail agents in TX, NM, OR, ID, MT & WA
• Agents have market exclusivity

Growth Opportunities:

• Expand into new geographic areas using existing and new agents

Slide # 12

TGA Operating Unit

Gross Premiums Produced
By Operating Unit

[Pie Chart]
HGA	32%
TGA	42%
Aerospace	10%
Phoenix	16%
[$219 million as of 9/06YTD]

Specialty:

• Difficult-to-place small business risk
• Primarily commercial auto and general liability

Agency Relationships:

• 38 independent general agencies in TX, LA, OK & AK
• 751 active retail agents in TX

Growth Opportunities:

• Increase premium retention
• Expand into new geographic areas
• Leverage HGA agency network

Slide # 13

Aerospace Operating Unit

Gross Premiums Produced
By Operating Unit

[Pie Chart]
HGA	32%
TGA	42%
Aerospace	10%
Phoenix	16%
[$219 million as of 9/06YTD]

Specialty:

• General aviation: small airports and small airplanes
• New/transitional pilots and older aircraft

Agency Relationships:

• 215 specialty aviation brokers in 48 states

Growth Opportunities:

• Increase premium retention
• Expand policy limits
• New marketing emphasis

Slide # 14

Phoenix Operating Unit

Gross Premiums Produced
By Operating Unit

[Pie Chart]
HGA	32%
TGA	42%
Aerospace	10%
Phoenix	16%
[$219 million as of 9/06YTD]

Specialty:

• Non-standard personal auto

Agency Relationships:

• 963 independent retail agents in TX, NM, AZ, OK,AR, ID and WA
• Focus on ease of doing business through technology

Growth Opportunities:

• Expand into new geographical areas
• Expand distribution network

Slide # 15

Key Growth Drivers

*. Increased Retention:

• Significantly increase revenue on existing production
• Existing book of business highly profitable
• Provides low-risk earnings growth potential through 2009

*. Organic Growth:

• Expand existing businesses into new geographies
• Opportunity to sell products across Operating Units
• Expand relationships into new states with existing agents

3. Acquisitions:

• Seek to selectively acquire complementary specialty/niche lines of property/casualty insurance
• Ability to enhance margins and increase ROI by efficiently using capital base and licenses
• Management has proven track record in acquisitions

Slide # 16

Key Growth Driver #1: Increased Retention

• Significantly increase earnings potential through retention of current business
• Retained only 67% of premiums produced in 2006.
• Goal: Increase retention to 100% of production over next three years
• Target combined ratio in the low 90%'s during all market cycles

Gross Premium Retention
As of September 2006
Bar Graph Retained & Non Retained

Produced CAGR: 34%

Retained CAGR: 56%

Slide # 17

Financial Overview

Mark Morrison

President & Chief Executive Officer

Slide # 18

Summary Income Statement

							Nine Months Ended
($ in thousands, except per sharedata)		Year Ended December 31					September 30
		2003	2004			2005	2005		2006
Gross Premiums Produced	$124,264			$119,305	$118,066		$90,217	$219,083
Gross Premiums Written	43,338			33,389	89,467		62,985	153,718
Net Premiums Earned	41,975			32,445	59,184		38,727	104,887
Total Revenues	69,559			63,121	87,035		60,397	148,072
Losses and LAE	30,188			19,137	33,784		22,584	60,478
Total Expenses	68,873			54,519	73,567		51,031	140,693
Net Income Before Extraordinary Gain	$661			$5,849	$9,186		$6,292	$4,461
Net Income	$8,745			$5,849	$9,186		$6,292	$4,461
Realized (Gains)/Losses	$88			$27	($58)		($52)	$1,501
Amort. of Discount on Convertible	-			-	-		-	9,625
Tax Effect	(30)			(9)	20		(18)	(4,084)
Net Operating Income (1)	$719			$5,867	$9,148		$6,222	$11,503
Earnings per Share:
Basic	$0.14			$0.83	$0.76		$0.58	$0.28
Diluted	0.13			0.82	0.76		0.58	0.28
Operating Earnings per Share (1):
Basic	$0.15			$0.83	$0.76		$0.57	$0.72
Diluted	0.15			0.82	0.76		0.57	0.72

(1) These non GAAP measurements should not be viewed as a substitute for net income or earnings per share determined in accordance with GAAP. Management believes this information provides useful supplemental information in evaluating our operating results.

Slide # 19

Select Financial Highlights

				Three Months Ended		Nine Months Ended
	Year Ended December 31			September 30		September 30
	2003	2004	2005	2005	2006	2005	2006
Gross premiums written	$43,338	$ 33,389	$ 89,467	$ 43,512	$ 58,107	$ 62,985	$ 153,718
Net premiums earned	41,975	32,445	59,184	19,024	42,194	38,727	104,887
Total revenues	69,559	63,121	87,035	25,167	56,365	60,397	148,072
Net Income	8,745	5,849	9,186	2,473	4,877	6,292	4,461
Loss Ratio (GAAP)	72.5%	60.5%	60.3%	58.0%	55.9%	58.3%	57.7%
Expense Ratio (GAAP)	26.5%	27.8%	34.6%	35.6%	29.1%	34.0%	30.4%
Combined Ratio (GAAP)	99.0%	88.3%	94.9%	93.6%	85.0%	92.3%	88.1%
EPS - Basic	$ 1.80	$ 0.83	$ 0.76	$ 0.17	$ 0.27	$ 0.58	$ 0.28
EPS - Diluted	$1.77	$ 0.82	$ 0.76	$ 0.17	$ 0.27	$ 0.58	$ 0.28
Return on Average Equity	49%	19%	16%	12%	17%	14%	6%
Adjusted Net Income (1) (2)	661	5,849	9,186	2,473	4,877	6,292	10,527
Adjusted EPS - Basic (1) (2)	$0.14	$ 0.83	$ 0.76	$ 0.17	$ 0.27	$ 0.58	$ 0.66
Adjusted EPS - Diluted (1) (2)	$ 0.13	$ 0.82	$ 0.76	$ 0.17	$ 0.27	$ 0.58	$ 0.66 $
Return on Average Equity (1) (2)	5%	19%	16%	12%	17%	14%	14%
Book Value Per Share	$ 4.52	$ 5.37	$ 5.89	$ 5.74	$ 6.83	$ 5.74	$ 6.83

(1) 2006 adjusted to exclude the effect of the non-cash interest charge (net of tax) of $6.1 million resulting from the convertible promissory notes issued and converted during the year. See Non-GAAP measure slide at the end of this presentation for a reconcilation to GAAP.

(2) 2003 excludes extraordinary gain of $8.1 million (net of tax) recognized in 2003 from the acquisition of PIIC.

Slide # 20

Pro Forma Capitalization

Capital structure designed to maximize ROE, sustain current financial strength ratings and provide flexibility for future working capital needs.

	As of September 30, 2006
($ in thousands)	Actual	As Adjusted
Debt:
Short-term Debt	$29,840	$17,340
Long-term Debt	55,516	43,316
Trust Account Securing
Structured Settlements	(24,326)	(24,326)
Total Debt	61,030	36,330
Total Stockholders' Equity	121,353	146,053
Total Capitalization	$182,383	$182,383
Debt/Total Capital	33.5%	19.9%

The "As Adjusted" amounts are the actual amounts adjusted for the application of $24.7 million in net proceeds received from our public stock offering completed in October 2006. Total debt is reduced by the $24.3 million in future guaranteed payments to the TGA sellers that are fully secured in a trust account on Hallmark's balance sheet.

Slide # 21

Investment Portfolio

Investment Portfolio
As of September 2006
$ in Millions

[Pie Chart]
Cash & Equivalents	($47)
Short-Term	($40)
Equity	($3.7)
Debt Securities	($153)

Objective: Maximize total return while maintaining safety of capital

• 2% of portfolio invested in equities
• Tax equivalent yield on fixed-income portfolio of approximately 4.8%
• Weighted-average duration of 3.0 years
• Weighted-average credit rating of "AA"

Slide # 22

Investment Considerations

• Management's interests aligned with shareholders
• Substantial low-risk growth potential through retention of existing business-geographic expansion-and acquisitions
• Disciplined underwriting strategy focused on profitability
• Track record of strong underwriting performance
• Operate in diversified, sustainable niche markets
• Demonstrated ability to identify and acquire profitable, niche businesses
• Strong balance sheet built on conservative investment and loss reserving philosophies
• Targeted long-term returns on equity of mid/high teens

Slide # 23

HALLMARK
FINANCIAL
SERVICES, INC.

NASDAQ: HALL

Slide # 24

Non-GAAP Measure Reconciliation

The following reconciles Hallmark's year to date net income, diluted earnings per share and return on average equity without interest expense from amortization attributable to the deemed discount on convertible promissory notes to its reported results (in thousands). Management believes this reconciliation provides useful supplemental information in evaluating the operating results of Hallmark's business. This disclosure should not be viewed as a substitute for net income, diluted earnings per share and return on average equity determined in accordance with U.S. generally accepted accounting principles ("GAAP"):

	Income excluding interest expense from amortization of discount, net of tax			Interest expense from amortization of discount		Tax effect	Net Income
Nine months ended September 30, 2006		$	10,527	$	9,625	$(3,559)	$ 4,461
Weighted average shares - basic			16,019				16,019
Weighted average shares - diluted			16,038				16,038
Average shareholders' equity			103,271				103,271
Net income per share - basic		$	0.66				$0.28
Net income per share - diluted		$	0.66				$0.28