EMC Insurance Group Inc. Reports 2003 3rdQ Reserve Strengthening

Des Moines, Ia.-based EMC Insurance Group Inc. announced that it will strengthen its bulk loss and settlement expense reserves by approximately $4,600,000 in the third quarter of 2003. This increase in reserves will reduce third quarter earnings by approximately $3,000,000 ($0.26 per share) on an after tax basis.

This reserve strengthening is being implemented in response to a recently completed actuarial evaluation of the Company’s carried reserves for the property and casualty insurance segment. Based on the results of this review, it was decided that the Company’s carried reserves should be increased moderately in light of an upward trend in projected ultimate losses. It should be noted that actuarial evaluations of the Company’s carried reserves are performed on a regularly-scheduled basis. The Company’s standard practice is to adjust its carried reserves as necessary in response to these evaluations in an effort to maintain a consistent level of reserve adequacy. The adjustment in reserves being implemented in the third quarter of 2003 represents an increase of only 1.3 percent of the total loss and settlement expense reserves carried at June 30, 2003.