21st Century Holding Company Reports Record Second-Quarter Operating Results.

Business Editors

21st Century Holding Company (Nasdaq:TCHC), a vertically integrated financial services holding company, today reported record operating earnings of $1,545,558 or $0.51 per share on 3,020,126 average shares outstanding, beating the Company's guidance of $0.39 by $0.12 per share, in its fiscal quarter ending June 30, 2002. These operating results exclude a write-down of the Company's investment in bonds of $1.5 million or $0.50 per share. Net income, including the bond write-down was $32,041 or $0.01 per share for the quarter ended June 30, 2002. This compares to a loss of ($1,489,671) or ($0.47) per share on 3,163,801 average shares outstanding for the same period in 2001.

Edward J. Lawson, President & CEO of 21st Century Holding Company, commented, "This was another solid quarter for our company. On an operating basis, we are continuing to deliver and fully expect our profitability to accelerate on a year over year basis. We are a true `financial services' company, with a multitude of vertically integrated revenue streams."

"Some of the second quarter company highlights were:

1. Our property division had another terrific quarter as earnings

increased due to favorable risk selection and adherence to

strict underwriting guidelines.

2. Our auto divisions, reinsured for an 8th consecutive year by

Transatlantic Reinsurance Company, A++ rated and one of the

strongest and most respected reinsurers in the country, had

record revenues and continued to experience lower loss ratios,

a trend that bodes well for our future.

3. Our finance company generated over $400,000 of income before

taxes in the quarter, which was a record. My wife, Michele,

and I have been in the finance business since 1987. It was

actually the engine of cash creation that gave us the money to

form our first insurance company, Federated National Insurance

Company, back in 1992. Premiums are guaranteed by Florida

Insurance Guaranty Association (FIGA), making premium

financing profitable and secure.

4. Our MGA handled increased volume with lower costs due to

improved technology and productivity gains. We believe this

will trend forward and allow us to develop new program

business. With regard to profitability, we're in the process

of migrating our business from one year to six-month policies,

which will substantially increase our MGA policy fee income

over time. MGA policy fee gross income in this last quarter

totaled $560,000.

5. Our claims company, Superior Adjusting, Inc., started

adjusting claims for FIGA and National Insurance Service Plan

during the quarter. These two sources of outside fee income

are in addition to our own two insurance companies and

demonstrate that Superior has developed into a first class

adjusting company.

6. Our Fed USA franchise company has really taken off. We

announced our 29th franchise closing on June 28, 2002 and we

are now announcing that we have closed on an additional three,

bringing the total number of Fed USA franchises to 32.

Furthermore, our goal of 40 franchises by year end now looks

conservative.

7. With more than 800 locations in over 32 states using the

EXPRESSTAX(R) trademark, Express Tax Service has successfully

positioned itself as a topnotch service bureau and licensor of

tax software. Their future goal is to offer a turnkey

opportunity with superior service and marketing campaigns at a

lower cost than current name brand competitors. Starting in

the third quarter, Express Tax Service will be launching their

newly formed franchise opportunity, EXPRESSTAX(R), which

already has substantial brand recognition in the marketplace.

8. Our company-owned agencies, 22 strong, had record same store

revenues and continued to anchor our company. Our

company-owned agencies and franchises, now numbering 54 and

growing, historically have given us a competitive edge in the

marketplace. Loss ratios from our captive distribution channel

trend out to be 20% lower than business from outside

independent agents."

Mr. Lawson continued, "I am proud of all the hard work and effort being put in by our employees and management team. Our shareholders can rest assured that we will do everything in our power to continue this progress. Because of all the positives propelling our company forward, we are now raising our guidance for the calendar year 2002 on an operating basis, exclusive of any write-down, from $1.40 per share to $1.50 per share. Guidance for calendar year 2003 is being raised from $1.75 per share to $1.80 per share. As the year began, we stated that by year-end our book value would increase from $4.64 per share to $5.64 per share, and even with a write-down on our bonds, we still believe that our book value will be approximately $5.64 per share at the end of 2002 and should then accelerate to over $7.00 per share at the end of 2003 -- in this market that's impressive. After 18 years in the financial services field, I truly believe that our future is now, our team of over 225 professionals are ready and unparalleled success is just around the corner."

An investor conference call will be held at 4:30 PM (EST) on July 18, 2002 to discuss the financial results and review the outlook of the Company. Listeners can access the conference call by dialing 973-582-2757.

21st Century Holding Company manages its insurance underwriting, distribution and claims process through its subsidiaries.

-- The Company's wholly owned subsidiaries, Federated National Insurance Company and American Vehicle Insurance Company, underwrite standard and non-standard personal automobile insurance in the state of Florida. Federated National also has authority to underwrite flood insurance, mobile home insurance, and homeowners property and casualty insurance in the state of Florida.

-- The Company's wholly owned managing general agent, Assurance Managing General Agents, Inc., has underwriting authority for Federated National, American Vehicle, and third-party insurance companies.

-- The Company's wholly owned claims adjusting company, Superior Adjusting, Inc., processes claims made by the insureds of Federated National, American Vehicle, and third party insurance companies which contract with Superior.

-- Federated Premium Finance, Inc., another wholly owned subsidiary, offers premium financing to insureds of Federated National and American Vehicle, as well as to third party insureds.

-- Express Tax Service, Inc., an 80% owned subsidiary, licenses its brand name and its software to retail tax preparers and over the Internet.

-- The Company offers other ancillary services including electronic income tax filing, tax preparation and tag & title transfer services through Federated Agency Group, Inc., also a wholly owned subsidiary.

-- Fed USA, Inc., a wholly owned franchiser company, offers single and master franchise opportunities to individuals to own and operate their own business with the support of two brands, Fed USA Insurance and Financial Services and Express Tax.

21st Century Holding Company (the "Company") cautions readers that certain important factors may affect the Company's actual results and could cause such results to differ materially from any forward-looking statements which may be deemed to have been made in this release or which are otherwise made by or on behalf of the Company. Future guidance does not anticipate any terrorist, severe weather or catastrophic events. For this purpose, any statements contained in this report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as "may," "will," "expect," "believe," "anticipate," "intend," "could," "would," "estimate," or "continue" or the negative other variations thereof or comparable terminology are intended to identify forward-looking statements. Factors which may affect the Company's results include, but are not limited to, risks related to the nature of the Company's business; the limit on the Company's ability to expand due to a consent order entered into with the Florida Department of Insurance; reinsurance; dependence on investment income; the adequacy of its liability for losses and LAE regulation; insurance agents; claims experience; limited experience in the insurance industry; competition; ratings by industry services; catastrophe losses; reliance on key personnel and other risks discussed elsewhere in this Report and in the Company's other filings with the Securities and Exchange Commission the ("Commission").

21st CENTURY HOLDING COMPANY
Financial Highlights (Unaudited)

                         For the Three             For the Six
                         Months Ended,             Months Ended,
                     ---------------------     ----------------------
                     6/30/02      6/30/01        6/30/02     6/30/01
                     -------      -------        -------     -------
Total Revenue      $8,851,501   $8,163,030    $18,358,501 $17,711,180
Net Realized
 Investment
 Gaines (Losses)   (1,513,517)  (1,809,009)   (1,459,736)  (1,883,042)
Pretax Income         923,391   (2,422,964)     2,467,627  (1,656,875)
Income Tax Expense    891,350     (933,293)     1,444,216    (665,950)
Net Income             32,041   (1,489,671)     1,023,411    (990,925)
Net Income Per
 Share                   0.01        (0.47)          0.34       (0.31)
Weighted Average
 Shares
 Outstanding        3,020,126    3,163,801      3,023,226   3,233,563