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EMC Insurance Group Inc. Announces Third Quarter Combined Ratio, Operating Income And Crop Loss Estimates, And Revises 2012 Operating Income Guidance

EMC Insurance Group Inc. (NASDAQ:EMCI) (the “Company”) today announced that the GAAP combined ratio for the third quarter of 2012 is expected to be approximately 99.3 percent and that operating income 1 is expected to be in the range of $0.63 to $0.67 per share.

“Both our property and casualty insurance segment and our reinsurance segment experienced strong operating results during the third quarter,” stated Bruce G. Kelley, President and Chief Executive Officer. “The primary drivers of the strong third quarter results are an increase in premium income, which is expected to approximate 13.2 percent, and a significant decline in catastrophe losses from the record amount experienced in 2011.”

Premium income for the third quarter is expected to increase approximately 10.5% in the property and casualty insurance segment and 21.5% in the reinsurance segment from the amounts reported in the third quarter of 2011. In the property and casualty insurance segment, the majority of the increase is attributed to rate level increases, growth in insured exposures and an increase in retained policies. In the reinsurance segment, the majority of the increase is attributed to a large offshore energy and liability proportional account that Employers Mutual Casualty Company began participating in effective January 1, 2012, as well as rate level increases implemented during the January 1 renewal season. As previously disclosed, the 2012 revenue stream on the offshore energy and liability account is somewhat back-loaded because it is a new account and the majority of the underlying policies are expected to have effective dates in the months of June and July.

Third quarter catastrophe losses are expected to total approximately $0.55 per share after tax, compared to $1.33 per share after tax in the third quarter of 2011. Catastrophe losses declined approximately 68.0 percent in the property and casualty insurance segment and 34.0 percent in the reinsurance segment.

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