Welcome to Shelter Insurance

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Welcome to Shelter Insurance

• From Missouri Farms
• to Worldwide Markets

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Our roots
Descendants of original farm club
members gather at Newcomer School.

• 1914 -- March 10 -- First farm club organized at
  Newcomer School in Brunswick, Missouri, giving
  birth to the Missouri Farmers Association.

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Our roots
Original seven insurance company employees, 1946

• 1946 -- The farm cooperative lends 100,000 to
  allow MFA Mutual Insurance Company to begin
  operations on January 1.
• Insuring automobiles and homes in Missouri
• Loan is paid back 2 years later.

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Shelter Country
We now operate in 14 states in the heartland of
America.
Arkansas Colorado Illinois
Indiana Iowa
Kansas Kentucky Louisiana
Mississippi Missouri Nebraska Nevada
Oklahoma Tennessee
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Shelter Country

• Also Licensed as Primary Carrier in
• Maryland
• Ohio
• Texas
• Vermont

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Shelter Country

• Licensed or Accredited as Reinsurer in
• Alabama Delaware
• Georgia Idaho
• Massachusetts Michigan
• Minnesota Montana
• New Hampshire New Jersey
• New York North Carolina
• North Dakota Oregon
• Pennsylvania South Carolina
• South Dakota Virginia
• West Virginia Wisconsin

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Financial growth

• Earned Premium Policyholder
  Surplus
• 1946 -- 347,818 105,193
• 1956 -- 17 million 2.2 million
• 1966 -- 47 million 15.6 million
• 1976 -- 136 million 57.2 million
• 1986 -- 281 million 230.6 million
• 1998 -- 622 million 718.6 million
• 12/31/03 -- 992 million 775.0 million
• 12/31/04 -- 1,008 billion 914.6 million
• 12/31/05 -- 1,012 billion 1,017.6 million
• -- 12/31/06 -- 1,013 billion 1,144.3 million

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We become Shelter

• 1980-81 were years of change.

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Our people

• Now have 1,788 employees
• More than 1,000 employees in Home Office
• Products distributed through 1,326 exclusive
  agents
• Branch Offices in 14 active state

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Our mission

• We tell our policyholders
• Seek Shelter Today!
• Before the sale by creating the best products.
• During the sale with professional service.
• After the sale with quality claims handling.
• Greatest value for the premium dollars.

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Shelter Mutual Property and Casualty Insurer
Shelter General Property and Casualty Insurer
Shelter Life Life and Health Insurer
Shelter Reinsurance Property Casualty
Reinsurer
Shelter Enterprises LLC
Daniel Boone Agency, LLC Insurance Broker
Shelter Financial Services, Inc. Finance Company
Shelter Financial Corporation Holding Company
Shelter Benefits Management Inc. Benefits Provider
Shelter Financial Bank Savings and Loan
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2006 P C Financial Results

• Premium Written -- 1.054 billion
• Net Premium Written -- 1.013 billion
• Loss Ratio 62.8
• Expense Ratio 37.2
• Combined Ratio 100.0
• Net Underwriting Gain Breakeven
• Net Income -- 122.6 million
• 12/31/06 Surplus -- 1,144.3 million
• Net Premium Written to Surplus Ratio .88 1
• Assets Under Management -- 3.7 billion

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2006Financial Results

• Conservative Asset Allocation
• Earthquake Reserve -- 52 million
• A.M. Best Rating of A
• BCAR 300 (Very strong capitalization)

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Our Strengths

• Internal property modeling capability using RMS
  6.0 for property aggregation control.
• Strong information services, system design, and
  operations support, including agent-designed
  eCommerce web-based systems.
• Significant dedication to information services
  resources.
• Streamlined electronic processing systems
  utilizing Imaging, Print Stream Document
  Management, and eCommerce.
• Successful self-directed investment operation.
• Extensive ceded and assumed reinsurance
  experience through Shelter Reinsurance Company.

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Our Strengths

• Wide range of bank products offered through
  Shelter Bank.
• Range of Life Insurance Company products.
• Extensive claims capabilities with staff of
  nearly 700, including property catastrophe
  response team.
• Actuarial staff highly experienced in reserving
  and sophisticated pricing techniques for all
  lines utilize tier rating and catastrophe
  modeling.
• Human resources capabilities include extensive
  experience in managing qualified and
  non-qualified benefit plans.

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Our Strengths

• Planning Research staff dedicated to the close
  link of business planning and budgeting.
• Internal auditing staff with extensive experience
  in auditing company and agency operations.
• Daniel Boone Agency, LLC Underwriters brokerage
  handling difficult to place risks.
• Training staff dedicated to development of
  technical, technological, sales, and supervisory
  skills for company and agency personnel.
• Marketing management with extensive experience in
  administration of 1,326 agency relationships.

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Our Strengths

• Experience managing legal exposures related to
  insurance company operations.
• Highly experienced personal lines and commercial
  lines underwriting staff, including field-based
  regional underwriters performing extensive
  inspection work and agency support services.
• Fully operational call center for claims and
  policy administration.
• Experienced facilities construction and
  management, as well as purchasing and procurement
  support, for 20 locations spread across 14-state
  operating territory.

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Our Strengths

• Formalized public relations and lobbying effort.
• Dedicated and experienced product development
  staff.
• Strong reserving history.
• Modeling capability for analyzing enterprise risk
  exposure for underwriting, investment, and
  business risk.
• Modeling capability for return on required
  capital by line of business.
• Scale and efficiency in backroom operations
  offering productivity advantages.

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Surplus History

• Year-end Surplus (millions)
• 2000 886
• 2001 748
• Mid 2002 670
• 2002 702
• 2003 775
• 2004 915
• 2005 1,018
• 2006 1,144
• Feb 2007 1,174

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Mitigating Risk---ERM

• Allocation of capitol
• Measurement of ROC by line by state
• Property Concentrations process, RMS
• Capitol to prudently retain risk
• Careful purchase of reinsurance
• Investments, Underwriting, Business Risk
• Commitment to spreading riskShelter Re

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Thank you for visiting Shelter