Richard J. Zick
President and
Chief Executive Officer

2009 - 106^th Annual Report

Who said this is not a "crazy business"? We put people's lives back together and that is what we do. The trick is to take in enough dollars to pay your claims, pay your agents fairly, run your operation with good professional people, keep the regulators and rating agencies happy, and somehow, at the end of the day, turn a profit. With three straight years of soft pricing, premiums falling universally for the entire industry, and some carriers still on a market share quest, we continue to be very fortunate to produce excellent results.

With a Combined Ratio of 91.2%, and $12 Million added to Surplus, we have grown this Company to record asset and surplus levels. In 2000, we had $14.5 Million in Surplus and $69 Million in Assets. Today, that stands at $83 Million and $193 Million respectively. Of particular note is our being raised to an "A" level from an A- by AM Best. It was a long, hard road from the post 9.11 B++ days to an "A" in May, 2009. We are very proud of this accomplishment.

I often hear our agents say "we stay the course" and the truth is, we do. We do not jump in and out of markets via rate to satisfy short-term market appetites. It still amazes me that someone can write a risk at 50% of our rate when we are barely making a profit. No one is that smart and they certainly are not making up points on the investment side. Time will tell but then I have said that for the last two years. The investment returns of 2009 will give some pause for the "Am I really losing money" syndrome. In addition, in 2009 we became licensed in Virginia, Maryland and Massachusetts. We will bring our Contractor Package into all three States.

We have some exciting New Products and increased level of capacity for 2010. We are committed to growing in 2010.

No one spends more time at working to improve our level of professionalism than Utica First. For the last three years, we have had close to 200 exams taken by our people. I have been at this a long time and this is the smartest group of people we have ever had. They know SERVICE to our Agents and Policyholders is key.

Our mission remains unchanged: we write niche products, keep them at competitive prices, underwrite to make money, ensure that we have great service, and treat our Agents and Policyholders with the respect that they deserve.