8-K

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): April 26, 2007

Philadelphia Consolidated Holding Corp.

(Exact Name of Registrant as Specified in Charter)

Pennsylvania	0-22280	23-2202671
(State or Other Jurisdiction	(Commission	(IRS Employer’
of Incorporation)	File Number)	Identification No.)

One Bala Plaza, Suite 100, Bala Cynwyd, PA	19004
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (610) 617-7900

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

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

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

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

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

TABLE OF CONTENTS

PRESS RELEASE

FIRST QUARTER 2007 CONFERENCE CALL PRESENTATION

FIRST QUARTER 2007 PREMIUMS BY SEGMENT

FIRST QUARTER 2007 ADDITIONAL SUPPLEMENTAL INFORMATION

ITEM 2.02	Results of Operations and Financial Condition
	On April 26, 2007, the registrant conducted a conference call announcing the results of the Company’s operations for the quarter ended March 31, 2007. Also on April 26, 2007 the registrant issued a Press Release concerning its first quarter 2007 results. The Press Release is attached as Exhibit 99.1. The conference call presentation is attached as Exhibit 99.2 to this report. Such exhibits shall be deemed “furnished” for purposes of the Securities Act of 1934, as amended.
	The registrant discloses net operating income, a non-GAAP financial measure, which it defines as net income adjusted for after-tax net realized investment gains and losses. Because net operating income is not a term defined by GAAP, the registrant’s net operating income may not be comparable to similarly titled measures reported by other companies. However, the registrant believes that this measure provides useful information to help investors measure the results of its regular business activities. The registrant utilizes net operating income in its budget and planning process and, in part, in measuring actual performance.

ITEM 9.01	FINANCIAL STATEMENTS AND EXHIBITS.
(a)	Financial Statements of Business Acquired.
	Not applicable.
(b)	Pro Forma Financial Information.
	Not applicable.
(c)	Exhibits.
	Exhibit 99.1 Press Release relating to First Quarter Results for period ended March 31, 2007.
	Exhibit 99.2 First Quarter 2007 Conference Call Presentation.
	Exhibit 99.3 First Quarter 2007 Premiums by Segment.
	Exhibit 99.4 First Quarter 2007 Additional Supplemental Information.

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.

	Philadelphia Consolidated Holding Corp. (Registrant)
Dated: April 27, 2007	By:	/s/ Craig P. Keller
		Craig P. Keller
		Executive Vice President, Secretary, Treasurer and Chief Financial Officer

EXHIBIT INDEX

Exhibit	Description	Method of Filing
99.1	Press Release relating to First Quarter Results for period ended March 31, 2007	Furnished electronically herewith.
99.2	First Quarter 2007 Conference Call Presentation	Furnished electronically herewith.
99.3	First Quarter 2007 Premiums by Segment	Furnished electronically herewith.
99.4	First Quarter 2007 Additional Supplemental Information	Furnished electronically herewith.

EX-99.1

PHILADELPHIA CONSOLIDATED HOLDING CORP.
FIRST QUARTER RESULTS
MARCH 31, 2007

APRIL 26, 2007 PRESS RELEASE

Bala Cynwyd, PA – Philadelphia Consolidated Holding Corp. (PHLY-NASDAQ) today reported net income for the quarter ended March 31, 2007 increased 31.2% to $66.0 million ($0.89 diluted earnings per share and $0.94 basic earnings per share) from $50.3 million ($0.70 diluted earnings per share and $0.73 basic earnings per share) for the quarter ended March 31, 2006. After-tax net realized investment gains (losses) were $1.1 million of gains for the quarter ended March 31, 2007 ($0.02 diluted income per share) versus $(0.3) million of losses ($0.00 diluted loss per share) for the quarter ended March 31, 2006. Gross written premiums increased 20.2% to $394.1 million from $328.0 million for the quarter ended March 31, 2006, and the combined ratio for the quarter was 77.6% versus 79.7% for the quarter ended March 31, 2006. The Company’s book value per share at March 31, 2007 increased 6.7% to $17.58 from $16.48 at December 31, 2006.

Financial results for the first quarter of 2007 included:

• A $12.9 million pre-tax ($8.4 million after-tax, or $0.11 diluted earnings per share) benefit from a decrease in net unpaid loss and loss adjustment expenses due to favorable trends in prior years’ claims emergence.

• Weather-related case incurred property losses of $16.9 million pre-tax ($11.0 million after-tax, or $0.15 diluted loss per share), compared to weather-related case incurred property losses of $6.6 million pre-tax ($4.3 million after-tax, or $0.06 diluted loss per share) for the quarter ended March 31, 2006.

James J. Maguire, Jr., CEO, said: “As a result of our differentiated sales model, we continued to see ample new business opportunities during the quarter which met our pricing and underwriting standards. Our combined ratio of 77.6% is indicative of continued vigilance in our underwriting and risk selection process. In the face of more competition, we continued to keep most of our commercial renewal business, as retention levels exceeded 90% of quoted accounts. New products contributed approximately $15 million to premium growth in the quarter, an indication that we continue to successfully diversify and broaden our product offerings. I thank our talented employees for executing at a high level during the quarter, and I remain optimistic that we will achieve our targeted goals for the balance of the year. ”

The Company will hold its quarterly conference call to discuss first quarter 2007 results today at 3:00 PM EDT. The call is being webcast and may be accessed at the Company’s web site at www.phly.com. The dial-in phone number for the conference call is (800) 289-0544.

Press Release
April 26, 2007
Page 2

Forward-Looking Information

This release may contain forward-looking statements that are based on management’s estimates, assumptions and projections. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, the Company provides the following cautionary remarks regarding important factors which, among others, could cause the Company’s actual results and experience to differ materially from the anticipated results or other expectations expressed in the Company’s forward-looking statements. The risks and uncertainties that may affect the operations, performance, development, results of the Company’s business, and the other matters referred to above include, but are not limited to: (i) changes in the business environment in which the Company operates, including inflation and interest rates; (ii) changes in taxes, governmental laws, and regulations; (iii) competitive product and pricing activity; (iv) difficulties of managing growth profitably; (v) claims development and the adequacy of the Company’s liability for unpaid loss and loss adjustment expenses; (vi) severity of natural disasters and other catastrophe losses; (vii) adequacy of reinsurance coverage which may be obtained by the Company; (viii) ability and willingness of the Company’s reinsurers to pay; (ix) future terrorist attacks; (x) the outcome of the Securities and Exchange Commission’s industry-wide investigation relating to the use of non-traditional insurance products, including finite risk reinsurance arrangements; and (xi) the outcome of industry-wide investigations being conducted by various insurance departments, attorneys-general and other authorities relating to the use of contingent commission arrangements. The Company does not intend to publicly update any forward looking statement, except as may be required by law.

In operation since 1962, PHLY designs, markets, and underwrites commercial property/casualty, personal lines and professional liability insurance products incorporating value added coverages and services for select industries. The Company, whose commercial and personal lines subsidiaries are rated A+ (Superior), and A- (Excellent), respectively, by A.M. Best Company, is nationally recognized as a member of Ward’s Top 50 and Forbes’ Platinum 400 list of America’s Best Big Companies. The organization has 41 offices strategically located across the United States to provide superior local service.

CONTACT: Investor Relations: Joseph Barnholt, Assistant Vice President, +1-610-617-7626, jbarnholt@phlyins.com.

PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

	As of
	March 31, 2007			December 31,
	(Unaudited)			2006
ASSETS
INVESTMENTS:
FIXED MATURITIES AVAILABLE FOR SALE AT MARKET (AMORTIZED COST $2,286,438 AND $2,136,231)	$	2,282,135		$	2,129,609
EQUITY SECURITIES AT MARKET (COST $277,422 AND $259,184)		331,859			304,033
TOTAL INVESTMENTS		2,613,994			2,433,642
CASH AND CASH EQUIVALENTS		138,896			108,671
ACCRUED INVESTMENT INCOME		22,416			20,083
PREMIUMS RECEIVABLE		327,295			346,836
PREPAID REINSURANCE PREMIUMS AND REINSURANCE RECEIVABLES		261,843			272,798
DEFERRED INCOME TAXES		27,575			26,657
DEFERRED ACQUISITION COSTS		165,216			158,805
PROPERTY AND EQUIPMENT, NET		26,498			26,999
OTHER ASSETS		51,815			44,046
TOTAL ASSETS	$	3,635,548		$	3,438,537
LIABILITIES AND SHAREHOLDERS’ EQUITY
POLICY LIABILITIES AND ACCRUALS:
UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES	$	1,330,657		$	1,283,238
UNEARNED PREMIUMS		775,859			759,358
TOTAL POLICY LIABILITIES AND ACCRUALS		2,106,516			2,042,596
PREMIUMS PAYABLE		67,322			66,827
OTHER LIABILITIES		209,873			161,847
TOTAL LIABILITIES		2,383,711			2,271,270
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
PREFERRED STOCK, $.01 PAR VALUE, 10,000,000 SHARES AUTHORIZED, NONE ISSUED AND OUTSTANDING		—			—
COMMON STOCK, NO PAR VALUE, 100,000,000 SHARES AUTHORIZED, 71,211,963 AND 70,848,482 SHARES ISSUED AND OUTSTANDING		386,731			376,986
NOTES RECEIVABLE FROM SHAREHOLDERS		(15,968	)		(17,074	)
ACCUMULATED OTHER COMPREHENSIVE INCOME		32,587			24,848
RETAINED EARNINGS		848,487			782,507
TOTAL SHAREHOLDERS’ EQUITY		1,251,837			1,167,267
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	3,635,548		$	3,438,537

PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
(Unaudited)

	For the Three Months
	Ended March 31,
	2007			2006
REVENUE:
NET EARNED PREMIUMS	$	318,718		$	276,546
NET INVESTMENT INCOME		26,973			20,062
NET REALIZED INVESTMENT GAIN (LOSS)		1,757			(394	)
OTHER INCOME		830			491
TOTAL REVENUE		348,278			296,705
LOSSES AND EXPENSES:
LOSS AND LOSS ADJUSTMENT EXPENSES		160,519			162,024
NET REINSURANCE RECOVERIES		(10,014	)		(18,359	)
NET LOSS AND LOSS ADJUSTMENT EXPENSES		150,505			143,665
ACQUISITION COSTS AND OTHER UNDERWRITING EXPENSES		96,904			77,017
OTHER OPERATING EXPENSES		3,155			2,332
TOTAL LOSSES AND EXPENSES		250,564			223,014
INCOME BEFORE INCOME TAXES		97,714			73,691
INCOME TAX EXPENSE (BENEFIT):
CURRENT		36,819			29,124
DEFERRED		(5,085	)		(5,754	)
TOTAL INCOME TAX EXPENSE		31,734			23,370
NET INCOME	$	65,980		$	50,321
PER AVERAGE SHARE DATA:
NET INCOME — BASIC	$	0.94		$	0.73
NET INCOME — DILUTED	$	0.89		$	0.70
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING		70,148,787			69,377,774
WEIGHTED-AVERAGE SHARE EQUIVALENTS OUTSTANDING		4,054,030			2,982,230
WEIGHTED-AVERAGE SHARES AND SHARE EQUIVALENTS OUTSTANDING		74,202,817			72,360,004

EX-99.2

Philadelphia Consolidated Holding Corp. Founded 1962

Certain information included in this presentation and other statements or materials published or to be published by the Company are not historical facts but are forward- looking statements relating to such matters as anticipated financial performance, business prospects, technological developments, new and existing products, expectations for market segment and growth, and similar matters. In connection with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the Company provides the following cautionary remarks regarding important factors which, among others, could cause the Company's actual results and experience to differ materially from the anticipated results or other expectations expressed in the Company's forward-looking statements. The risks and uncertainties that may affect the operations, performance, development, results of the Company's business, and the other matters referred to above include, but are not limited to: (i) changes in the business environment in which the Company operates, including inflation and interest rates; (ii) changes in taxes, governmental laws, and regulations; (iii) competitive product and pricing activity; (iv) difficulties of managing growth profitably; (v) claims development and the adequacy of our liability for unpaid loss and loss adjustment expenses; (vi) severity of natural disasters and other catastrophe losses; (vii) adequacy of reinsurance coverage which may be obtained by the Company; (viii) ability and willingness of our reinsurers to pay; (ix) future terrorist attacks; (x) the outcome of the Securities and Exchange Commission's industry-wide investigation relating to the use of non-traditional insurance products, including finite risk reinsurance arrangements; and (xi) the outcome of industry-wide investigations being conducted by various insurance departments, attorneys- general and other authorities relating to the use of contingent commission arrangements. The Company does not intend to publicly update any forward looking statement, except as may be required by law.

AGENDA First Quarter 2007 Financial Highlights Financial Results Segment Information Investment Portfolio Selected Operating Statistics Drivers of Future Growth 2007 Expectations Q&A

First Quarter Highlights (in millions, except share and per share data) For the Three Months Ended March 31, For the Three Months Ended March 31, For the Three Months Ended March 31, 2007 2006 Change Gross Written Premiums $394.1 $328.0 20.2% Net Earned Premiums $318.7 $276.5 15.3% Net Investment Income $27.0 $20.1 34.3% Net Income $66.0 $50.3 31.2% After Tax Net Realized Gain (Loss) $1.1 $(0.3) Loss & LAE Ratio 47.2% 51.9% Expense Ratio 30.4% 27.8% Combined Ratio 77.6% 79.7% Diluted Earnings Per Share $0.89 $0.70 27.1% After Tax Realized Investment Gain (Loss) Per Share $0.02 $0.00 Weighted Average Shares & Share Equivalents Outstanding 74,202,817 72,360,004

First Quarter Highlights (in millions, except per share data) For the Three Months Ended March 31, For the Three Months Ended March 31, For the Three Months Ended March 31, 2007 2006 Net Operating Income $64.9 $50.6 A-T Realized Investment Gains (Losses) $1.1 $(0.3) Net Income $66.0 $50.3 Diluted Operating Earnings Per Share $0.87 $0.70 A-T Realized Investment Gains Per Share $0.02 $0.00 Diluted Earnings Per Share $0.89 $0.70 Net Loss and Loss Adjustment Expense Ratio 47.2% 51.9% Acquisition and Underwriting Expense Ratio 30.4% 27.8% Combined Ratio 77.6% 79.7%

First Quarter Highlights (in millions, except share and per share data) March 31, 2007 December 31, 2006 % Increase Total Shareholders' Equity $1,251.8 $1,167.3 7.2% Book Value per Share $17.58 $16.48 6.7% Shares Outstanding 71,211,963 70,848,482 0.5% ROE (1) 29.5% 30.1% Return on equity excluding other comprehensive income (loss). March 31, 2007 ROE calculated on trailing twelve months basis.

First Quarter 2007 Events Financial results for the quarter ended March 31, 2007 included: Net Income/(Loss) Diluted Earnings/(Loss) Per Share As reported $66.0 $0.89 Favorable prior year net loss reserve development $8.4 $0.11 Increase in weather related case incurred property losses compared to the quarter ended March 31, 2006 $(6.7) $(0.09) (in millions, except per share data)

First Quarter 2007 Development on Prior Years - Net Basis ($'s in millions) Accident Year Pre-Tax Net Increase (Decrease) in Unpaid Loss and Loss Adjustment Expenses Primarily Due To: 2006 $(7.0) Favorable claims emergence on commercial property and commercial automobile product lines 2005 $(4.9) Favorable claims emergence across most product lines 2004 $(3.0) Favorable claims emergence across most product lines 2003 $1.3 Unfavorable claims emergence on automobile rental leasing product lines 2002 and Prior $0.7 Unfavorable claims emergence on commercial general liability product lines Total $(12.9)

Gross Written Premiums by Segment (in millions) For the Quarters For the Quarters For the Quarters Ended March 31, Ended March 31, Ended March 31, % 2007 2006 Increase/ (Decrease) Segment Commercial Lines $311.4 $243.0 28.1% Specialty Lines 60.7 58.1 4.5% Personal Lines 22.0 26.9 (18.2)% Total $394.1 $328.0 20.2%

Commercial Lines Segment 79.0% of 1st Quarter 2007 GWP CAGR 2001-2006 = 29.9% 28.1% Q/Q Growth Gross Written Premiums 2001 2002 2003 2004 2005 2006 QTD 1Q06 QTD 1Q07 316 473 662.3 874 960.3 1169.4 243 311.4 (in millions)

Specialty Lines Segment (Professional Liability) 2001 2002 2003 2004 2005 2006 QTD 1Q06 QTD 1Q07 79.3 110.2 154.1 184.4 205.3 227.6 58.1 60.7 15.5% of 1st Quarter 2007 GWP CAGR 2001-2006 = 23.5% 4.5% Q/Q Growth Gross Written Premiums (in millions)

Gross Written Premiums 2001 2002 2003 2004 2005 2006 QTD 1Q06 QTD 1Q07 Dwelling/Fire 78.3 80.5 89.6 112.9 99.3 96.2 26.9 22 5.5% of 1st Quarter 2007 GWP CAGR 2001-2006 = 4.2% 18.2% Q/Q decrease Personal Lines (in millions)

High Quality Investment Portfolio Portfolio market value - $2,735.1mm Fixed income securities Average quality AAA Portfolio duration 4.6 years 5.4% taxable equivalent yield Quality long-term growth stocks As of March 31, 2007 Municipal Bonds 0.4 CMO 0.132 MBS 0.168 Other Structured Securities 0.08 Corporate Bonds 0.049 Common Stock 0.119 All Other 0.008 Cash Equivalents 0.044 Municipal Bonds CMO MBS Other Structured Securities Corporate Bonds Common Stock All Other Cash Equivalents

Net Investment Income 2001 2002 2003 2004 2005 2006 QTD 1Q06 QTD 1Q07 32.4 37.5 38.8 43.5 63.7 91.7 20.1 27 (in millions) 5 Year CAGR: 23.1% Effective Tax Rate 30.1% 28.3% 23.4% 20.2% 21.5% 23.6% 22.6% 22.8% Q/Q Change 34.3%

Selected Operating Statistics Operating Statistics 1st Quarter 07 Renewal Retention (Quoted) Commercial Lines - 93.8% Specialty Lines - 94.9% Personal Lines - 69.0% Rate Changes Commercial Lines - 0.1% decrease (Q/Q) Specialty Lines - 1.4% decrease (Q/Q) Personal Lines - 42.8% increase (Q/Q) New Business Growth (Count), excluding Personal Lines Segment and Collector Vehicle Product 1st QTR: 06 - 7,895 1st QTR: 07 - 11,563 46.5% increase (1) (1) Including the collector vehicle product, the increase is 282%.

Selected Operating Statistics Preferred Agents Total Count - 185 Total GWP Growth - $35.8 million (Q/Q); 39.4% increase Renewal Retention (Quoted) - 91.2% New Business 2007 - $27.7 million (Q/Q); 71.5% increase Employee Statistics Total Employee Count - 1,300 Total GWP Per Employee - $1.2 million Turnover (Y/Y) - 12.7%

Drivers of Future Growth National presence - 41 offices / Mixed marketing New product offerings - Complement Core Products Disruption in the industry Regulatory Actions ? Rating downgrades Experienced management / underwriting & pricing discipline Advanced technology - lower expenses and improved process A+ (Superior) rating - Flight to quality Preferred agent program - 15.0% premium growth

2007 Expectations 2007 Operating EPS Range: $3.45- $3.60 Assumes one catastrophe loss retention for: Commercial Lines: $10.0 million (pre-tax) Personal Lines: $7.5 million (pre-tax) Organic Growth - approximating 15.0% Combined Ratio - approximating 80% Renewal retention levels approximating 90% Investment environment in transition Increased competition

Philadelphia Consolidated Holding Corp. Founded 1962

EX-99.3

PHILADELPHIA INSURANCE COMPANIES
SUMMARY SEGMENT TOTALS
FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006
(IN THOUSANDS)

	3/31/2007		3/31/2006		2007 VS. 2006			3/31/2007		3/31/2006		2007 VS. 2006
	GROSS		GROSS		%			GROSS		GROSS		%
	WRITTEN		WRITTEN		INCREASE			EARNED		EARNED		INCREASE
	PREMIUMS		PREMIUMS		<DECREASE>			PREMIUMS		PREMIUMS		<DECREASE>
COMMERCIAL LINES		311,368		243,107		28.1	%		297,734		240,786		23.7	%
SPECIALTY LINES		60,743		58,068		4.6	%		56,765		51,501		10.2	%
PERSONAL LINES		22,003		26,867		-18.1	%		23,115		25,341		-8.8	%
TOTAL ALL LINES		394,114		328,042		20.1	%		377,614		317,628		18.9	%

	3/31/2007		3/31/2006		2007 VS. 2006			3/31/2007		3/31/2006		2007 VS. 2006
	NET		NET		%			NET		NET		%
	WRITTEN		WRITTEN		INCREASE			EARNED		EARNED		INCREASE
	PREMIUMS		PREMIUMS		<DECREASE>			PREMIUMS		PREMIUMS		<DECREASE>
COMMERCIAL LINES		285,422		228,119		25.1	%		271,905		224,370		21.2	%
SPECIALTY LINES		50,560		45,428		11.3	%		45,482		39,928		13.9	%
PERSONAL LINES		1,451		14,409		-89.9	%		1,331		12,248		-89.1	%
TOTAL ALL LINES		337,433		287,956		17.2	%		318,718		276,546		15.2	%

EX-99.4

PHILADELPHIA INSURANCE COMPANIES
ADDITIONAL SUPPLEMENTAL INFORMATION
FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006
(IN THOUSANDS)

NET LOSS AND LOSS ADJUSTMENT EXPENSES:

	Net Incurred Loss and Loss Adjustment Expenses					(1) Net Paid Loss and Loss Adjustment Expenses
	For The Three Months Ended					For The Three Months Ended
	March 31,					March 31,
PRODUCTS	2007		2006			2007		2006
COMMERCIAL LINES	$	115,467	$	110,798		$	73,145	$	62,676
SPECIALTY LINES		30,777		26,819			15,857		14,454
PERSONAL LINES		4,261		6,048			3,200		5,191
TOTAL	$	150,505	$	143,665		$	92,202	$	82,321
WHOLE ACCOUNT NET QUOTA SHARE REINSURANCE COMMUTATIONS		0		0			0		(31,804	)
TOTAL NET LOSS AND LOSS ADJUSTMENT EXPENSES	$	150,505	$	143,665		$	92,202	$	50,517
Net Loss & Lae Reserves @ March 31, 2007			$	1,153,732
Taxable Equivalent Yield @ March 31, 2007				5.4	%
Portfolio Duration @ March 31, 2007			4.6		yrs
Book Value Per Common Share @ March 31, 2007			$	17.58
Shares Repurchased During the Three Months Ended March 31, 2007				0

(1) During February 2006, the Company entered into a Reinsurance Commutation and Release Agreement effective as of January 1, 2006 with respect to the 2004 Whole Account Net Quota Share Reinsurance contract. As a result of this commutation, the Company increased its Net Unpaid Loss and Loss Adjustment Expenses and decreased its Net Paid Loss and Loss Adjustment Expenses by $31.8 million for the three months ended March 31 2006.