Our approach with Arizona and Nevada will be to build up a presence as quick as we can to offset the summer storm activity in the Midwest. That's not to mean we don't expect storms or losses in the Southwest. We do, but they'll be of a more diverse nature than what we're used to now. As such, it's our strategic intention to ramp up business as soon as possible. We were approved to write business in both states effective December 1, 2012. We have appointed a solid marketing talent in Shane Opdahl to appoint Agents and train them, and we have put some of our best underwriting talent on the job. So far, so good!!! In the course of almost three months, we have appointed two dozen high quality Independent Agents to represent our products. As an indication of our "love" for Independent Agents, we hosted an introductory meeting with these Agents on "Valentine's Day." We were very satisfied with the attendance given that we had only really been in the state for just over two months. There were over 60 attendees and the reception was warm (and I'm not just referring to the weather).

Once again, MFM has shown that one of our key differentiators is our ability to develop new products and enter new states. Our systems capabilities coupled with the expertise of our staff provide us the unique capacity to navigate the twists and turns associated with bringing a new state online. We're very satisfied with the job that our employees have done whether it be our R&D staff that researched and executed this venture, our IT staff that has helped on the technical aspects, the testers that have identified defects prior to our official entry, the claims staff who secured counsel for purposes of educating us on the local legal environment or the marketing, service and underwriting staff that have been instrumental in bringing on new Agents and training them. This was a team effort and we're all very proud.

We're also cognizant of the next steps. This is only the first chapter and we know that top notch service is the best way to assure success with our new crop of Southwest Agents. It's comforting to know this isn't our first rodeo. We've been down this road before and we've succeeded in carving out market share in new states by servicing our customers and bringing value to our Independent Agents. One way we do so is by recognizing the extrinsic and intrinsic value of the Independent Agent. By treating our Agents as customers, they are better able to service our mutual insureds. We intend to extend this unique philosophy to Arizona and Nevada. It will be interesting to find out how Midwest values play out in the Southwest?

Thank you for your business!!!

Best Regards,
Aaron Boyd, CPCU
Vice President - Marketing & Product