In the current global economic environment, the headlines are rife with major events that understandably cause concern among us all. I would like to assure you that Hastings Mutual’s financial stability remains strong and is recognized as such by a number of insurance company rating organizations:

• A.M. Best Company --- A+ Superior (rated at least “A” Excellent since 1961)
• Demotech, Inc. --- “A” Double Prime Unsurpassed
• TheStreet.com --- A+ Excellent (only 5 Property/Casualty companies receive this highest rating)
• Ward's Group --- 2009 Ward's 50 Top Performing Insurance Companies

Despite all of the severe storm losses that we incurred in 2008 (double the annual average) Hastings Mutual ended the year with a combined loss ratio of 96.0%. The written premium total for the year was the highest in the company's history!

2009 has proven to be a challenging insurance year with a number of intense storms in our five state territory. We hope that 2009 does not have a repeat of the ravages from a major storm like Hurricane Ike that occurred in 2008. Regardless, our Claims Department, along with our outstanding Hastings Mutual agencies will be ready to assist our policyholders.

Further following the conservative financial management philosophy, Hastings Mutual does not sponsor golf tournaments or other sporting events. We don’t have an elaborate home office or a corporate jet. What Hastings Mutual does have is a rock solid financial balance sheet and the proven ability and intent to provide the highest level of financial security. We have more policyholders’ surplus than net written premium.

I and the other officers of Hastings Mutual can state unequivocally, “Hastings Mutual Insurance Company is here for you and your clients in these troubled times. Hastings Mutual is The Right Choice in Any Direction”.

Sincerely,

William H. Wallace, CPCU

President and CEO