BIRMINGHAM, Ala., April 24 /PRNewswire-FirstCall/ -- Infinity Property and Casualty Corporation ( NASDAQ:IPCC ) , a national provider of personal automobile insurance, today reported results for the three months ended March 31, 2008:

                                               Three Months Ended
                                                     March 31,
  (in millions,                                                     %
   except per share amounts and ratios)     2008       2007      Change



  Gross written premiums                  $253.5     $304.8      (16.8%)
  Revenues                                $249.2     $274.9       (9.3%)

  Net earnings                             $14.0      $21.8      (35.7%)
  Net earnings per diluted share           $0.86      $1.10      (21.8%)

  Operating earnings (1)                   $15.1      $20.8      (27.5%)
  Operating earnings per diluted share (1) $0.92      $1.05      (12.4%)

  Underwriting income (1)                  $13.0      $19.2      (32.2%)
  Combined ratio                           94.5%      92.5%      2.0 pts

  Return on equity                          9.2%      13.0%    (3.8) pts
  Operating income return on equity (1)     9.9%      12.4%    (2.5) pts

  Book value per share                    $37.80     $34.87         8.4%
  Debt to total capital                    24.6%      22.7%      1.9 pts


  (1)  Measures used in this release that are not based on generally
       accepted accounting principles ("non-GAAP") are defined at the end of
       this release and reconciled to the most comparable GAAP measure.

   Gross written premiums declined 16.8% during the first quarter of 2008 as compared with the first quarter of 2007 primarily from a decline in gross written premiums in California, Florida, Georgia and Infinity's Maintenance States which include states such as Alabama, Missouri and South Carolina. Partially offsetting premium declines in these states was premium growth in Nevada, Pennsylvania and Texas.

   Earnings and underwriting income for the three months ended March 31, 2008 included $5.9 million, pre-tax, ($0.24 per diluted share after-tax) of favorable development on prior accident period loss and loss adjustment expense reserves compared with $1.1 million, pre-tax ($0.03 per diluted share after-tax) of favorable development during the three months ended March 31, 2007.

2008 Earnings Guidance

   As a result of a higher than expected combined ratio in the first quarter of 2008, Infinity is adjusting its operating earnings guidance to $3.05 - $3.35 per diluted share down from $3.25 - $3.65 per diluted share.

Forward-Looking Statements

   This press release contains certain statements that may be deemed to be "forward-looking statements" that anticipate results based on our estimates, assumptions and plans that are subject to uncertainty. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements in this press release not dealing with historical results or current facts are forward-looking and are based on estimates, assumptions, and projections. Statements that include the words "believes," "seeks," "expects," "may," "should," "intends," "likely," "targets," "plans," "anticipates," "estimates" or the negative version of those words and similar statements of a future or forward-looking nature identify forward-looking statements. Examples of such forward-looking statements include statements relating to expectations concerning market conditions, premiums, growth, earnings, investment performance, expected losses, rate changes and loss experience.

   Actual results could differ materially from those expected by Infinity depending on: changes in economic conditions and financial markets (including interest rates), the adequacy or accuracy of Infinity's pricing methodologies, actions of competitors, the approval of requested form and rate changes, judicial and regulatory developments affecting the automobile insurance industry, the outcome of pending litigation against Infinity, weather conditions (including the severity and frequency of storms, hurricanes, snowfalls, hail and winter conditions), changes in driving patterns and loss trends. Infinity undertakes no obligation to publicly update or revise any of the forward-looking statements. For a more detailed discussion of some of the foregoing risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see Infinity's filings with the Securities and Exchange Commission.

  Infinity Property and Casualty Corporation
  Statement of Earnings
  (in millions, except EPS)


                                                       For the Three Months
                                                          Ended March 31,
                                                        2008          2007
  Revenues:
    Earned premiums                                   $235.1        $256.0
    Net investment income                               15.3          16.9
    Realized gains on investments                       (1.4)          1.8
    Other income                                         0.2           0.3
       Total revenues                                  249.2         274.9

  Costs and Expenses:
    Loss and loss adjustment expenses(1)               169.5         177.4
    Commissions and other underwriting expenses         52.5          59.3
    Interest expense                                     2.8           2.8
    Corporate general and administrative expenses        1.9           1.9
    Restructuring charge                                 0.3          (0.2)
    Other expenses                                       1.4           0.6
       Total costs and expenses                        228.5         241.9

  Earnings before income taxes                          20.7          33.0
  Provision for income taxes                             6.7          11.2
  Net earnings                                         $14.0         $21.8

  Earnings per common share:
  Basic                                                $0.87         $1.11
  Diluted                                              $0.86         $1.10

  Average number of common shares:
  Basic                                               16.129        19.516
  Diluted                                             16.348        19.714

  Cash dividends per common share                      $0.11         $0.09


  Note:  Columns may not foot due to rounding

  Notes:
  (1)  Loss and loss adjustment expenses for the three months ended March
       31, 2008, include $5.9 million, pre-tax, of favorable development on
       prior accident period loss and loss adjustment expense reserves.

       Loss and loss adjustment expenses for the three months ended March
       31, 2007 include $1.1 million, pre-tax, of favorable development on
       prior accident period loss and loss adjustment expense reserves.



  Infinity Property and Casualty Corporation
  Condensed Balance Sheet
  (in millions, except book value per share)


                                                   For the Period Ended
                                                 March 31,    December 31,
                                                   2008           2007

  Assets:
    Investments:
         Fixed maturities, at fair value           $1,238.3       $1,226.8
         Equity securities, at fair value              45.2           49.7
            Total investments                       1,283.5        1,276.5
    Cash and cash equivalents                          38.5           46.8
    Accrued investment income                          12.1           13.4
    Agents' balances and premiums receivable          342.7          334.0
    Prepaid reinsurance premiums                        1.8            1.8
    Recoverables from reinsurers                       30.2           29.5
    Deferred policy acquisition costs                  79.2           75.8
    Current and deferred income taxes                  25.7           31.8
    Receivable for securities sold                     45.8            0.6
    Prepaid expenses, deferred charges
     and other assets                                  35.3           31.1
    Goodwill                                           75.3           75.3
          Total assets                             $1,970.1       $1,916.6

  Liabilities and Shareholders' Equity:
  Liabilities:
    Unpaid losses and loss adjustment expenses       $591.2         $618.4
    Unearned premiums                                 428.4          411.2
    Payable to reinsurers                               0.1            0.2
    Long-term debt                                    199.5          199.5
    Commissions payable                                27.7           26.9
    Payable for securities purchased                   63.1            2.1
    Accounts payable, accrued expenses and
     other liabilities                                 47.6           57.0
           Total liabilities                        1,357.6        1,315.4

  Shareholders' Equity:
    Common stock                                       21.0           20.9
    Additional paid-in capital                        340.6          340.2
    Retained earnings (1)                             438.9          426.6
    Other comprehensive income                          7.0            8.4
    Treasury stock, at cost                          (194.9)        (194.9)
             Total shareholders' equity               612.5          601.2
             Total liabilities and
              shareholders' equity                 $1,970.1       $1,916.6

  Shares outstanding                                 16.205         16.200
  Book value per share                               $37.80         $37.11


  Note:  Columns may not foot due to rounding

  Notes:
  (1)  The change in retained earnings from December 2007 is a result of net
       income of $14.0 million less shareholder dividends of $1.8 million.


  Definitions of Non-GAAP Financial and Operating Measures

Operating earnings are defined as net income, before realized gains and losses and the cumulative effect of a change in accounting principle, after tax. Infinity reports this non-GAAP measure because realized gains and losses can be volatile and because it is a measure used often by investors in evaluating insurance companies. Net earnings are the most comparable GAAP measure.

Underwriting income measures the insurer's profit on insurance sales after all losses and expenses have been paid. It is calculated by deducting loss and loss adjustment expenses and underwriting expenses from premiums earned. Infinity reports this non-GAAP measure to show profitability before inclusion of investment income or taxes and because it is a measure used often by investors in evaluating insurance companies. Net earnings are the most comparable GAAP measure.

Below is a schedule that reconciles operating earnings and underwriting income, both non-GAAP measures, to net earnings:

                                                       For the Three Months
                                                          Ended March 31,
  (in millions, except EPS)                               2008        2007

  Earned premiums                                       $235.1      $256.0
  Loss and loss adjustment expenses                     (169.5)     (177.4)
  Commissions and other underwriting expenses            (52.5)      (59.3)

  Underwriting income                                     13.0        19.2

  Net investment income                                   15.3        16.9
  Other income                                             0.2         0.3
  Interest expense                                        (2.8)       (2.8)
  Corporate general and administrative expenses           (1.9)       (1.9)
  Restructuring charge                                    (0.3)        0.2
  Other expenses                                          (1.4)       (0.6)

  Pre-tax operating earnings                              22.1        31.2

     Provision for income taxes                           (7.1)      (10.5)

  Operating earnings, after-tax                           15.1        20.8

     Realized gains (losses) on investments, pre-tax      (1.4)        1.8
     Provision for income taxes                            0.5        (0.6)
     Increase in provision for tax valuation allowance    (0.2)       (0.1)
           Realized gains on investments, net of tax      (1.1)        1.0

  Net earnings                                           $14.0       $21.8

  Operating earnings per share - diluted                 $0.92       $1.05
  Realized gains (losses) on investments, net of tax     (0.05)       0.06
  Increase in provision for tax valuation allowance      (0.01)      (0.01)
  Net earnings per share - diluted                       $0.86       $1.10


  Note: Columns may not foot due to rounding

Infinity also makes available an investor supplement on our website. To access the supplemental financial information, go to www.ipacc.com and click on "Investor Relations" followed by "Quarterly Reports."

Source: Infinity Property and Casualty Corporation