With much more accounting to be completed, we expect an estimated first quarter Combined Ratio of .93-.95 which will produce an Underwriting Profit and a Surplus gain for the quarter. At this point in the calendar, we are always mindful of the storm season upon us but are thankful for this first quarter cushion of profitable results. Also, we have a great Catastrophe Reinsurance program which limits our net losses and our ever growing percentage of casualty business further diversifies us from storm impact. Years without limited storms are always better financial years than years with excessive storms.

Premium grew nicely in the first quarter. Written premiums grew 6.2% which is a result we are very pleased with in this current economy. Most all of you know we have been growing faster in Commercial Lines than Personal Lines the past few years but we are seeing renewed momentum in Personal Lines. This increase in Personal Lines activity we are attributing to acceptance of our new Edge on-line Agency quoting and servicing system. Adding Choicepoint's Data Prefill module along with automatic "teiring" for Personal Auto are also likely positives influencing Personal lines growth. Personal Lines change functionality will be added shortly and then we will turn our attention to deploying Edge on-line functionality in Commercial Lines with quoting, new business issuance, and endorsement servicing.

We recently reorganized our Customer Service unit into two units. One unit will internally focus service to our Underwriting and Claims functions. The newly formed unit will focus entirely on YOU. The mission of this newly formed Agents Service Center will be heavily focused on helping our Marketing staff quote, prepare, and deliver new business commercial proposals to you. This group will also respond to all of your service needs by phone, email, or Instant Messaging. Finally, this group will in time be conducting on line seminars for Agents to conduct training on our Systems. This new group is capably supervised by Rita Grabow. Rita and her family reside in South Dakota which further illustrates the effectiveness of our "work from home" office model. It may also interest you that a large percentage of our Agents Service Center employees have previous Agency experience which adds much more empathy for what Agents do and need for service. In short, the goal of this unit is to "help you better serve your customers and sell more insurance." Nothing changes in your methods of contacting this new unit. Contact phone numbers and email addresses remain unchanged. Phone 1-800-CALLMFM (1-800-225-5636) X7077 or service@midwestfamily.com Embedded within Edge is an Instant Messaging module to immediately contact a Representative of the Agents Service Center. Our IM module gives us the capability to share your screen and to immediately diagnose what issue you may be experiencing. Agents are giving us good reviews on this IM feature as a training aid and time saver in the quoting process.

We are ever mindful that our success depends on your success. It is our mission to treat our Agents as our primary customer. If you are successful we will be successful and we know that continuing to focus and respond to your sales and service needs will assure our Company's success. As such, thank you for your sales efforts in the first quarter. Know we appreciate your business. We are optimistic about prospects for the balance of 2010.

Best regards,

Ron Boyd, CPCU
President and CEO