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HARLEYSVILLE GROUP INC. COMMENTS ON LOSSES FROM HURRICANE ANDREW

 HARLEYSVILLE GROUP INC. COMMENTS ON LOSSES FROM HURRICANE ANDREW
 HARLEYSVILLE, Pa., Sept. 8 /PRNewswire/ -- Harleysville Group Inc. (NASDAQ: HGIC), a regional insurance holding company, reports that while it is premature to accurately estimate total losses from Hurricane Andrew, the company expects its losses to exceed the catastrophe reinsurance retention level.
 Bradford W. Mitchell, chairman of the board, president and chief executive officer of Harleysville Group, commented: "Under our catastrophe reinsurance contracts, our companies are responsible for the first $6 million of each catastrophe and 5 percent of losses in excess of that amount. Harleysville Group and its affiliate -- Harleysville Mutual Insurance Company -- pool all premiums, losses and expenses as part of an intercompany pooling agreement. Since Harleysville Group's participation in the pool is 60 percent, the impact of this loss to the public company is substantially reduced."
 Assuming that the $6 million catastrophe retention level is reached, as is now expected, the effect on Harleysville Group would be $0.20 per share on an aftertax basis.
 All of the losses were incurred in south Florida, on business underwritten through the Atlantic Insurance Company of Savannah, Harleysville's regional insurer in the Southeast. Virtually all of the losses paid to date have been for property damage covered by homeowners policies. Harleysville does not underwrite insurance in Louisiana.
 A special Harleysville catastrophe (CAT) team established a command center in south Florida before the hurricane struck early Monday morning. Within 24 hours, the center was manned by a full complement of claims and support personnel from all over the company.
 "We have been providing our policyholders with on-the-spot cash advances whenever possible," explained Mitchell. "During these difficult times, they deserve outstanding service and have a right to expect it. While Harleysville has relatively few policyholders in the stricken area, we deeply sympathize with all who suffered such devastation in this storm."
 Harleysville Group Inc. is a regional holding company for six property and casualty insurers whose marketing territory encompasses the entire East Coast. The companies include: Atlantic Insurance Company of Savannah, Connecticut Union Insurance Company, Harleysville Insurance Company of New Jersey, Huron Insurance Company, New York Casualty Insurance Company and Worcester Insurance Company. Harleysville Group also manages the operations of Berkshire Mutual Insurance Group, the financial results of which are not consolidated into Harleysville Group. Harleysville Group's property/casualty subsidiaries are rated A+ (Superior) by the A.M. Best Company.
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 -0- 9/8/92
 /CONTACT: Frederick W. Baker, 215-256-5287, or Mark R. Cummins 215- 256-5025, or Bruce J. Magee, 215-256-5011, or Robert Simpson Jr. 215-256-5392, all of Harleysville Group/
 (HGIC) CO: Harleysville Group Inc. ST: Pennsylvania IN: INS SU:


KD-MJ -- PH005 -- 6900 09/08/92 10:06 EDT
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Publication:PR Newswire
Date:Sep 8, 1992
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