Alfa Corporation Reports Third Quarter Results.

MONTGOMERY, Ala. -- Alfa Corporation (Nasdaq/NM:ALFA) today announced financial results for the third quarter and nine months ended September 30, 2005. Operating income for the third quarter was $24,219,493, or $0.30 per diluted share, compared with operating income of $19,542,970, or $0.24 per diluted share, for the third quarter of 2004, an increase of 23.5% on a per share basis. Net income, which includes net realized investment gains, was $25,102,904, or $0.31 per diluted share, for the third quarter of 2005, compared with net income of $20,720,248, or $0.26 per diluted share, for the same period in 2004, a per share increase of 20.7%. Premiums and policy charges increased 15.0% to $160,887,004 for the third quarter of 2005.

For the nine months ended September 30, 2005, operating income was $72,396,566 compared with operating income of $63,384,085 for the first nine months of 2004. On a per share basis, operating income increased 14.1% to $0.90 per diluted share for the nine-month period in 2005 compared with $0.79 per diluted share for the same period in 2004. Net income, which includes net realized investment gains, was $75,228,407, or $0.93 per diluted share, for the first nine months of 2005, compared with net income of $66,763,266, or $0.83 per diluted share, for the same period in 2004, a per share increase of 12.5%. Premiums and policy charges increased 13.0% to $470,163,960 for the first nine months of 2005.

Commenting on the results, Alfa's Chairman, President and Chief Executive Officer, Jerry A. Newby, said, "I am pleased with the results of another solid quarter. Our operating performance was driven by the property and casualty combined ratio, as well as the premium growth in our life company. This was accomplished at the same time our employees and policyholders were dealing with the impact of another large storm in the Gulf Coast region.

"In the aftermath of Hurricane Katrina, Alfa employees showed their concern for the many families affected by this immense storm by donating their resources and their time volunteering in many of the recovery efforts. In addition, our companies have responded to the tremendous devastation in western Alabama and in Mississippi by contributing to relief efforts and by moving as quickly as possible to service our policyholders. Our dedicated claims, marketing and operations staffs have settled claims extremely fast and efficiently so that our policyholders could begin to rebuild. I am proud of our employees, who have volunteered and contributed so much to the many agencies helping with disaster relief.

"As we approach year-end," Newby added, "we are excited about the roll-out of our new property-casualty policy administrative system that now is in operation in Mississippi. This is going to make doing business with Alfa easier then ever before. Our goal with this improvement, as always, is to be the best provider of personal line products to families - wherever we do business."

Alfa Corporation will host a conference call today at 10:30 am. Eastern time. Investors and other interested parties may access the teleconference by calling 800-289-0518, or via links located on Alfa's web site: www.alfains.com. A 30-day Internet replay of the call will also be available from Alfa's web site.

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's National Market under the symbol ALFA.

The associated investor supplement package for the third quarter and nine months ended September 30, 2005, may be found by clicking on the web cast link in the "Invest in Alfa" section of Alfa's web site and is also available at: http://www.irinfo.com/alfa/3q05fsx.pdf.

Investors are cautioned that statements in this press release 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.

ALFA CORPORATION
              CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                              (UNAUDITED)

                                 Nine Months Ended
                                   September 30,           Statistics
                         ---------------------------------------------
                            2005         2004    % Change  2005   2004
                         ---------------------------------------------

Revenues
 Premiums - Property and
  Casualty Insurance     412,565,810  362,892,190   13.69
 Premiums - Life
  Insurance               30,873,739   27,381,569   12.75
 Policy Charges - Life
  Insurance               26,724,411   25,677,169    4.08
 Net Investment Income    70,489,105   66,884,351    5.39
 Other Income             17,228,139    6,302,792  173.34
----------------------------------------------------------------------
     Total Revenues      557,881,204  489,138,071   14.05
----------------------------------------------------------------------

Benefits and Expenses
 Benefits & Settlement
  Expenses               323,277,862  291,231,267   11.00  57.95 59.54
 Dividends to
  Policyholders            2,945,396    2,855,278    3.16   0.53  0.58
 Amortization of
  Deferred Policy
  Acquisition Costs       81,997,955   70,113,452   16.95  14.70 14.33
 Other Operating
  Expenses                50,685,119   38,562,920   31.43   9.09  7.88
----------------------------------------------------------------------
     Total Expenses      458,906,332  402,762,917   13.94  82.26 82.34
----------------------------------------------------------------------


Income Before Provision
 for Income Taxes         98,974,872   86,375,154   14.59  17.74 17.66

Provision For Income
 Taxes                    26,578,306   22,991,069   15.60  26.85 26.62
----------------------------------------------------------------------

Operating Income          72,396,566   63,384,085   14.22

Realized Investment
 Gains, Net of Tax         2,831,841    3,379,181  (16.20)
----------------------------------------------------------------------
 Net Income               75,228,407   66,763,266   12.68
======================================================================

Operating Income Per
 Share - Basic                  0.90         0.79   14.09
======================================================================

Operating Income Per
 Share - Diluted                0.90         0.79   14.05
======================================================================

Net Income Per Share -
 Basic                          0.94         0.83   12.55
======================================================================

Net Income Per Share -
 Diluted                        0.93         0.83   12.52
======================================================================

Dividends Per Share           0.2875       0.2550   12.75
======================================================================

Average Shares
 Outstanding - Basic      80,115,937   80,024,581    0.11
======================================================================

Average Shares
 Outstanding - Diluted    80,642,174   80,526,003    0.14
======================================================================


                                 Three Months Ended
                                   September 30,           Statistics
                         ---------------------------------------------
                            2005        2004     % Change  2005   2004
                         ---------------------------------------------

Revenues
 Premiums - Property and
  Casualty Insurance     141,615,762  122,908,311   15.22
 Premiums - Life
  Insurance               10,570,000    8,813,442   19.93
 Policy Charges - Life
  Insurance                8,701,242    8,234,689    5.67
 Net Investment Income    24,607,048   22,430,220    9.70
 Other Income              5,280,320    1,983,300  166.24
----------------------------------------------------------------------
     Total Revenues      190,774,372  164,369,962   16.06
----------------------------------------------------------------------

Benefits and Expenses
 Benefits & Settlement
  Expenses               110,019,051   99,704,264   10.35  57.67 60.66
 Dividends to
  Policyholders              923,570      892,324    3.50   0.48  0.54
 Amortization of
  Deferred Policy
  Acquisition Costs       28,468,283   23,839,349   19.42  14.92 14.50
 Other Operating
  Expenses                18,171,081   13,807,450   31.60   9.52  8.40
----------------------------------------------------------------------
     Total Expenses      157,581,985  138,243,387   13.99  82.60 84.11
----------------------------------------------------------------------


Income Before Provision
 for Income Taxes         33,192,387   26,126,575   27.04  17.40 15.89

Provision For Income
 Taxes                     8,972,894    6,583,605   36.29  27.03 25.20
----------------------------------------------------------------------

Operating Income          24,219,493   19,542,970   23.93

Realized Investment
 Gains, Net of Tax           883,411    1,177,278  (24.96)
----------------------------------------------------------------------
 Net Income               25,102,904   20,720,248   21.15
======================================================================

Operating Income Per
 Share - Basic                  0.30         0.24   23.68
======================================================================

Operating Income Per
 Share - Diluted                0.30         0.24   23.46
======================================================================

Net Income Per Share -
 Basic                          0.31         0.26   20.91
======================================================================

Net Income Per Share -
 Diluted                        0.31         0.26   20.69
======================================================================

Dividends Per Share           0.1000       0.0875   14.29
======================================================================

Average Shares
 Outstanding - Basic      80,099,751   79,938,616    0.20
======================================================================

Average Shares
 Outstanding - Diluted    80,702,154   80,397,352    0.38
======================================================================

Management believes that operating income and operating income per
share, non-GAAP financial measures, serve as meaningful tools for
assessing the profitability of the Company's ongoing operations.
Operating income is defined by the Company as net income excluding
realized investment gains and losses, net of applicable taxes.
Operating income per share represents operating income divided by the
weighted average shares outstanding for the reporting period.
Management uses operating income and operating income per share as
measures of the Company's ongoing profitability since they eliminate
the effect of securities market volatility from earnings.


                           ALFA CORPORATION
                      CONSOLIDATED BALANCE SHEETS

                               (Unaudited)
                              September 30,    December 31,
                                  2005            2004       % Change
                             --------------- --------------- ---------
Assets
 Investments:
   Fixed Maturities Held for
    Investment, at amortized
    cost (fair value $99,125
    in 2005 and $123,935 in
    2004)                           $93,291        $114,708    -18.67%
   Fixed Maturities Available
    for Sale, at fair value
    (amortized cost
    $1,357,489,706 in 2005
    and $1,305,288,027 in
    2004)                     1,388,338,773   1,354,507,490      2.50%
   Equity Securities
    Available for Sale, at
    fair value (cost
    $102,876,099 in 2005 and
    $83,445,562 in 2004)        116,609,665      99,701,250     16.96%
   Policy Loans                  61,033,938      58,476,569      4.37%
   Collateral Loans             122,214,269     110,792,974     10.31%
   Commercial Leases              2,180,883       4,155,791    -47.52%
   Other Long-Term
    Investments                 147,896,392     145,474,366      1.66%
   Short-Term Investments        86,578,315      80,988,969      6.90%
                             --------------- --------------- ---------
      Total Investments       1,924,945,526   1,854,212,117      3.81%
 Cash                            26,878,559      20,052,493     34.04%
 Accrued Investment Income       16,320,710      16,726,050     -2.42%
 Accounts Receivable             79,884,611      50,452,538     58.34%
 Reinsurance Balances
  Receivable                      2,543,567       5,279,560    -51.82%
 Due from Affiliates              1,426,934               -    100.00%
 Deferred Policy Acquisition
  Costs                         200,843,207     183,258,224      9.60%
 Assets Classified as Held
  for Sale                       69,800,889      77,450,278     -9.88%
 Goodwill                        13,924,306               -    100.00%
 Other Intangible Assets (net
  of accumulated amortization
  of $509,600 in 2005)            8,598,400               -    100.00%
 Other Assets                    18,481,355      15,266,244     21.06%
                             --------------- --------------- ---------
      Total Assets           $2,363,648,064  $2,222,697,504      6.34%
                             =============== =============== =========

Liabilities and Stockholders' Equity
 Policy Liabilities and
  Accruals - Property and
  Casualty Insurance           $150,655,101    $154,107,730     -2.24%
 Policy Liabilities and
  Accruals - Life Insurance
  Interest-Sensitive Products   593,042,567     555,733,736      6.71%
 Policy Liabilities and
  Accruals - Life Insurance
  Other Products                191,424,456     180,410,535      6.10%
 Unearned Premiums              226,998,055     185,856,467     22.14%
 Dividends to Policyholders      11,325,666      11,262,132      0.56%
 Premium Deposit and
  Retirement Deposit Funds        5,969,991       6,369,125     -6.27%
 Deferred Income Taxes           38,631,806      43,100,038    -10.37%
 Liabilities Associated with
  Assets Classified as Held
  for Sale                          989,428         340,876    190.26%
 Other Liabilities               84,534,757      73,877,730     14.43%
 Due to Affiliates                        -      29,995,986   -100.00%
 Commercial Paper               223,793,160     204,303,206      9.54%
 Notes Payable                   70,000,000      70,000,000      0.00%
 Notes Payable to Affiliates     27,539,017      15,887,635     73.34%
                             --------------- --------------- ---------
      Total Liabilities       1,624,904,004   1,531,245,196      6.12%
                             --------------- --------------- ---------
 Commitments and
  Contingencies
 Stockholders' Equity :
   Preferred Stock, $1 par
    value                                 -               -      0.00%
      Shares authorized:
       1,000,000
      Issued: None
   Common Stock, $1 par value    83,783,024      83,783,024      0.00%
      Shares authorized:
       110,000,000
      Issued: 83,783,024
      Outstanding: 80,145,005
       in 2005 and 79,833,467
       in 2004
   Capital in Excess of Par
    Value                        15,660,549      10,961,782     42.86%
   Accumulated Other
    Comprehensive Income
    (unrealized gains on
    securities available for
    sale, net of tax of
    $27,167,358 in 2005 and
    $39,450,553 in 2004;
    unrealized (losses) on
    interest rate swap
    contract, net of tax of
    ($222,276) in 2005 and
    ($1,406,747) in 2004;
    unrealized gains (losses)
    on other long-term
    investments, net of tax
    of ($38,299) in 2005 and
    $16,565 in 2004)             26,906,783      38,060,371    -29.30%
   Retained Earnings            651,777,660     599,609,509      8.70%
   Treasury Stock, at cost
   (shares, 3,638,019 in 2005
    and 3,949,557 in 2004)      (39,383,956)    (40,962,378)    -3.85%
      Total Stockholders'
       Equity                   738,744,060     691,452,308      6.84%
                             --------------- --------------- ---------
      Total Liabilities and
       Stockholders' Equity  $2,363,648,064  $2,222,697,504      6.34%
                             =============== =============== =========

Book Value per share                  $9.22           $8.66
                             =============== ===============

Book Value per share
 (excluding FAS 115)                  $9.06           $8.37
                             =============== ===============