SEC FORM 4

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person^*

STEPHENS GERALD D

(Last)

(First)

(Middle)

9025 N. LINDBERGH DRIVE

(Street)

PEORIA

61615

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
RLI CORP [ RLI ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

X	Director	10% Owner
	Officer (give title below)	Other (specify below)

3. Date of Earliest Transaction (Month/Day/Year)
11/27/2006

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	11/27/2006		M/K		75,256	A	$13	1,201,821.9212⁽¹⁾	D
Common Stock	11/27/2006		F/K		39,283	D	$57.38	1,162,538.9212⁽¹⁾	D
Common Stock								18,483.6572	I	By Executive Deferred Comp
Common Stock								95,313.4913⁽²⁾	I	By Key Emp. Benefit Plan
Common Stock								28,482.0399⁽³⁾	I	By Trust for Grandchildren
Common Stock								3,692	I	By Trust for Sister
Common Stock								68,935	I	By Wife

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
Option	$15.9063							05/06/2000	05/06/2009	Common Stock	55,114		55,114	D
Stock Option	$15.7813							05/04/2001	05/04/2010	Common Stock	49,664		49,664	D
Stock Option	$20.05							05/03/2001	05/03/2011	Common Stock	1,440		1,440	D
Stock Option	$21.1							05/07/1999	05/07/2008	Common Stock	77,762		77,762	D
Stock Option	$29.405							05/01/2003	05/01/2012	Common Stock	1,080		1,080	D
Stock Option	$29.55							05/01/2004	05/01/2013	Common Stock	720		720	D
Stock Option	$34.55							05/03/2005	05/03/2014	Common Stock	360		360	D
Stock Option	$40.39							02/02/2005	02/02/2014	Common Stock	360		360	D
Stock Option	$13	11/27/2006		M/K			75,256	05/01/1998	05/01/2007	Common Stock	75,256	$13	0⁽⁴⁾	D

Explanation of Responses:

1. Ownership reflects dividend reinvestment.

2. Ownership reflects dividend reinvestment.

3. Ownership reflects dividend reinvestment.

4. Options balance adjusted to reflect 2 additional options received pursuant to the 1995 and 1998 stock splits.

	Gerald D Stephens	11/29/2006
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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