Alfa Corporation Announces Changes to Inter-Company Pooling Agreement.

MONTGOMERY, Ala. -- Alfa Corporation (Nasdaq/NM:ALFA) today announced that its Board of Directors and the representative Boards of the Alfa Mutual Group have approved the participation of Alfa Vision Insurance Corporation in the pooling agreement with other companies in the Alfa Group. In addition, approval was also given to allow Alfa Mutual Fire Insurance Company to retrocede the quota share business it receives from Alfa Virginia Mutual Insurance Company to the same inter-company pool.

Alfa Corporation acquired Vision Insurance Group, LLC ("Vision"), a full-service managing general agency that currently writes nonstandard automobile insurance policies in nine states, in January of 2005. At the same time Alfa Corporation formed an insurance subsidiary, Alfa Vision Insurance Corporation (AVIC), through which Vision will write its nonstandard automobile business. Beginning January 2005, AVIC will cede 100% of its direct business to the Alfa inter-company pool and receive in return 5% of the business included in the Alfa Group inter-company pool. Alfa Insurance Corporation and Alfa General Insurance Corporation, both wholly owned subsidiaries of Alfa Corporation, will reduce their respective pooling participations from the current 32.5% to 30.0% to allow for the Vision addition.

Vision currently operates in Texas, Missouri, Indiana, Ohio, Virginia, Tennessee, Arkansas, Kentucky and Florida. It is estimated that AVIC will have direct earned premiums of approximately $70 million in 2005, with a combined ratio in the 100% to 105% range.

In August 2001, Virginia Mutual Insurance Company signed an affiliation agreement with Alfa Insurance Group. As a result of this affiliation, the name was changed to Alfa Virginia Mutual Insurance Company (AVMIC), a quota share agreement was initiated with Alfa Mutual Fire Insurance Company, and Virginia Mutual employees became employees of Alfa Mutual Insurance Company. AVMIC currently cedes 80% of its risk to Alfa Mutual Fire Insurance Company under this agreement. The quota share is indefinite as to duration, and includes all lines of business. AVMIC is headquartered in Glen Allen, Virginia, and was chartered in 1935. Today, AVMIC writes approximately $41 million of property and casualty business in Virginia and North Carolina. Writings are split roughly 80% personal lines and 20% commercial lines. It is estimated that AVMIC will have direct earned premium of approximately $45 million in 2005, with a combined ratio in the mid 90% range.

Alfa Corporation is engaged in insurance and financial activities through its subsidiaries. The common stock of Alfa Corporation is traded on the NASDAQ Stock Market (National Market System) under the symbol ALFA.

Investors are cautioned that statements which relate to the future are, by their nature, uncertain and dependent upon numerous contingencies - including political, economic, regulatory, climatic, competitive, legal, and technological - any of which could cause actual results and events to differ materially from those indicated in such forward-looking statements. Additional information regarding these and other risk factors and uncertainties may be found in Alfa Corporation's filings with the Securities and Exchange Commission.