Underwriting Pooling Adjustment Approved

Harleysville, Pa. – Harleysville Group Inc. and Harleysville Mutual Insurance Co. have received all necessary approvals from various state departments of insurance, and have amended their intercompany pooling agreement, effective Jan. 1, 2008. The amendment, which was approved and jointly announced by each company's board of directors on Nov. 26, 2007, adjusts the aggregate share of the pool for the insurance subsidiaries of Harleysville Group to 80%.

All Harleysville property/casualty subsidiaries participate in an underwriting pooling arrangement whereby all premiums, losses and expenses for each individual company's business are shared in a pool. The arrangement, which was established in 1986, is designed to produce more consistent underwriting results over the long term by spreading financial risk among the broad base of pool members.

"This adjustment in our intercompany pool reflects the strength of our company's financial condition, the confidence we have in our underwriting results and our prospects for continuing success, and our desire to have our shareholders, including Harleysville Mutual, benefit more from our improved operating performance," says Michael Browne, Harleysville Group's president and CEO. “As we look ahead in 2008 and beyond, this change will provide Harleysville Group with greater opportunity for increased earnings and, subsequently, enhanced access to capital, both of which will benefit our combined operations."

Source: Harleysville Group Inc.