Greetings. And welcome to the Markel Second Quarter 2010 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Steve Markel, Vice Chairman for Markel. Thank you, Mr. Markel. You may begin.

Thank you. I appreciate everybody joining the Markel conference call today. During our call, we may make forward-looking statements. Additional information about factors that could cause actual results to differ materially from those projected in the forward-looking statements is described under the captions Risk Factors and Safe Harbor and Cautionary Statement in our most recent annual report on Form 10-K and on quarterly report Form 10-Q.Our quarterly report, Form 10-Q, which is filed on our website a www.markelcorp.com, also provides a reconciliation to GAAP of certain non-GAAP measures which we may be discussing in our call today. The second quarter and six months of 2010 is off to a pretty good start. We were disappointed to report underwriting loss in the six-month period of time of 102%. 4 points of this is related to the Chilean earthquake and the Deepwater Horizon oil rig loss. However, it is probably more important to note that pricing is still very, very weak in the property and casualty insurance sector and we, as everybody else in the marketplace, is struggling to get appropriate levels of price increase. The good news is that book value increased 3% at June 31st to $291.71, up from $282 at the end of the second quarter. Additionally, we have two other events that occurred in the quarter that I think are very important to note. First, we announced a couple of weeks ago our agreement to purchase Aspen Holdings and FirstComp insurance group, which we hope will close in the fourth quarter of the year. Aspen and FirstComp write approximately $300 million of Specialty workers’ compensation insurance through 9000 retailers in 31 states. This transaction will significantly increase the size and scale, and scope of our Specialty unit, where we market Specialty insurance products to retail insurance brokers. And we are hopeful not only to expand our workers’ comp writings in more states and through other relationships within the Markel organization. But we are certainly hopeful to creating and delivering new and different Specialty products to these 9000 agents of Aspen. So we are very, very excited about that. I think it is going to be a very, very favorable move for Markel and creates a little bit of enthusiasm to do something new and exciting. Additionally, in May, shortly after our shareholders’ meeting, we announced some executive management changes. Richie Whitt, Tom Gayner and Mike Crowley became Co-Presidents of Markel. Additionally, Anne Waleski was promoted to the Chief Financial Officer. So on today’s call, our lineup will be slightly different. After, well, in about two seconds, I’ll introduce Anne Waleski, our Chief Financial Officer. She will be followed by Richie Whitt, our new Co-President, to talk about operations, and Tom Gayner, Co-President and Chief Investment Officer and President of Markel Ventures, to talk about our investment activities. I’ll follow it up to moderate the questions and answers. Anne?

Thank you, Steve, and good morning, everyone. I will follow the same format that Richie has in past quarters. I will focus my comments primarily on year-to-date results. I’ll start by discussing our underwriting operations, followed by a brief discussion of our investment results and bring the two together with a discussion of our total results for the six months. Moving right into the underwriting results, gross premium volume was up 1% at $1 billion for the first six months of 2010. Higher gross premium volume in the London Insurance market segment, which was due in part to our acquisition of Elliott Special Risks in late 2009, was partially offset by continuing competition across many of our product lines, particularly within the excess and surplus lines segment. Net written premium was also up slightly to the prior year at $900 million. Retentions were at 89% compared to 90% in the prior year. Earned premiums decreased 9%, compared to 2009 due to lower gross and net written premiums over the past several quarters. Our combined ratio was 102% for the first half of 2010, compared to 97% in 2009. The 2010 current accident year loss ratio was 71%, compared to 69% in 2009. The increase is due in part to losses from the Chilean earthquake and the Deepwater Horizon drilling rig explosion, which resulted in $33 million or 4 points of underwriting loss in the first six months of 2010. Favorable redundancies on prior year’s loss reserve decreased to $75 million or 9 points of favorable development, compared to $94 million or 10 points of favorable development in 2009. The decrease was primarily due to less favorable development of prior year’s losses in the London Insurance market segment. Our 2010 expense ratio increased approximately 2 points to 40%. The increase in…

Thanks, Anne. Good morning, everyone. I want to make a few comments this morning regarding our North American and International insurance operations. On future calls, Mike Crowley and I are going to share these duties. As Anne and Steve reported, we produced 102 combined ratio for the six months. While this does include 4 points of catastrophe losses even at a 98 combined, that really does not meet the return hurdles we desire. The markets in the U.S. and internationally remain extremely competitive. In addition, the weak economic recovery is adversely impacting demand for insurance products. While the insurance market picture is a bit gloomy, we’re extremely excited about the progress we are making in our businesses and that is what really counts here. On the E&S side, One Markel continues to make great progress and we’re closing the gap on premiums. After being down 11% on gross written premium in the first quarter, Excess and Surplus Lines was down 5% in the second quarter. The combination of the One Markel platform, increased marketing initiatives, new products and refreshed products is having the desired impact. We’re gaining momentum and believe the second half of the year is going to be strong for us. Our Specialty Admitted segment continues to do well and they are holding their own against the competition. Market conditions are really no better here but we’re combating them with a relentless focus on sales and service. Just a quick example, our business development specialists have made almost 500 face-to-face agency calls in the first half of the year and that pace is going to continue for the rest of the year. In addition, we’re extremely excited, as Steve said, about our recently announced acquisition of Aspen Holdings Inc. Aspen underwrites approximately $300 million of workers’ compensation business…

Thank you, Richie. Good morning, everyone. Thank you for joining us. My comments today will be brief. I’ll speak for a moment about our results during the first half of the year and then talk about our investment game plan for the second half and beyond. Additionally, as always, I will answer any questions you might have during the Q&A period. During the first half, we earned a total return of 2% on the investment portfolio. Equities were mildly negative at 0.9%, compared to a 6.5% decline in the S&P 500 and fixed income was a positive 4.1%. This produced a total return for the portfolio of 3.1% in local currency. The foreign currency effect in the quarter was a negative 1.1% and the product of all these factors equals a 2% positive return for the portfolio, those are the results. More importantly, I’ll now attempt to describe what we are doing going forward. First, in fixed income, we remain committed to owning the highest credit quality instruments that we can find and keeping our duration at the shorter end of the four to five-year range in which we operate. We’re pleased with the returns we’ve earned in fixed income over the last few years but we can do simple math. The prospective returns from today’s low level of interest rates will not be as good in the next few years as what they have been in the recent past. If you are tuned into the financial markets these days, it seems like deflation is the headline story of our time. As is almost always the case, the genesis for the headlines is true, true especially if you’re looking in the rearview mirror of recent hard data, as opposed to the unclear, unknowable and imprecise future. All across the globe,…

Thank you, Tom. As you all know, Markel’s financial model is to earn consistent underwriting profits and superior investment returns to build shareholders’ value. While our six-month results fall short on the underwriting side, we are optimistic that in the balance of 2010, we can still achieve that long-term goal. The investment outlook, that is the short-term investment outlook, as always, is very uncertain. However, we continue to be optimistic about our ability to earn solid long-term returns by investing in quality businesses both public and private. With that, operator, I’d like to open the floor to questions.

Thank you. (Operator Instructions) Thank you. Our first question is coming from the line of Amit Kumar with Macquarie Bank. Please proceed with your question. Amit Kumar – Macquarie Bank: Good morning, and thanks for the call. Just starting with Aspen Holdings, I guess, three quick questions. First of all, you talked about a $300 million topline number. What sort of number do you expect to renew or keep on your books going forward?

Currently, Aspen’s business is a mix of businesses they retain in their own insurance company and businesses they place with other insurance companies. The transaction probably will not close until sometime in the fourth quarter. So clearly, the impact in 2010 is virtually nothing, very, very, very, very small. We will, however, start participating in some of their business as soon as we can. We’ve achieved -- we have filings in a number of the states that we’ll be able to start participating actually in the business probably before closing but it will obviously in 2011 be something less than that $300 million. The workers’ comp market is also very competitive and Aspen, not unlike the rest of the Markel organization, has a clear mission of earning underwriting profits. So from our perspective, it’s not about the volume but it’s about pricing the business in order to make an underwriting profit. So, that $300 could be something less when we look into 2011 and certainly will be as it relates to what goes through Markel’s books. In terms of earned premium, there is also a bit of a lag. If we write a policy in January, we earn it around over the period. So even if we wrote the full $300 million, which we’re not going to do in 2011, the impact on earned premiums would be substantially less than that. So, it’s really a part of a longer term strategy that will pay dividends, hopefully, in the long run. But in terms of the model for 2010, 2011, it’s not going to move the needle in a huge manner.

Yeah. And I think, FirstComp, their carrier is keeping, I think, roughly $120 million of it today. We obviously will want to try to increase that and so, I think, probably, at the top end, we could get $200 million of it, assuming it stays at the $300 million for 2011. Amit Kumar – Macquarie Bank: Okay. That’s helpful. And just a related question. $135 million is what you’re paying up front. Now, there is a contingent value component, which would, I guess, depending on Aspen’s loss reserves and profit commissions and there is an outstanding option to buy shares, what would that number add up to in sort of a best-case scenario?

You know, it’s really unknowable at this point in time. I don’t think, Richie, there is really not a top side…

No, we’ve…

… we do the top side, I mean theoretically, if they settled all their resources to zero, the number would be a very large number because obviously that is not going to happen.

I think the number that it sort of pegs on in terms of their 12/31/2009 balance sheet would be roughly $47 million. If that balance sheet were ultimately to prove out to be exactly the numbers they had booked, I think it would be roughly $47 million, to the extent that balance sheet improves, the number can go up. To the extent the balance sheet proves to have some deficiencies in it, the number would come down.

When we close, we will be doing an actuarial evaluation of the loss reserves and for Markel’s book at the date of closing. We will need to make an assessment of our view of those loss reserves and when we do that, that number will have some more clarity. And I think that’s probably the best way to think about it. Amit Kumar – Macquarie Bank: Okay. That’s very helpful. And just one question on the reserve development and I will re-queue. In the 10-Q, you talked about Italian med mal and construction professionals in Australia. I presume this is the same med mal business, which some of your -- some of the other companies in Specialty space have also had adverse development. Is this the same book which a lot of other companies are facing issues or is this a separate issue which you might be facing?

No. This is actually a different book. This is Italian medical malpractice. It was business we wrote in 2007 and 2008. We went into that market. We did a lot of work on the market. So we went in feeling like we had a pretty good handle on what we were writing, it’s Italian hospitals. And we canceled the program, ended the program fairly quickly but we’re still seeing development from that program. So we’ve been out of that business since the beginning of 2009, but we’re still seeing some development from it. Amit Kumar – Macquarie Bank: And does this relate to a TPA?

No. This is business we wrote through our Lloyd’s Syndicate. So it’s Markel International business, written through the Lloyd’s Syndicate Italian medical malpractice business. So, one thing, probably to just make sure, our U.S. medical malpractice book, obviously that book is, it was very profitable at the top of the hard market. A lot of people have realized that and have driven the rates down considerably, certainly from the peak in the U.S. But we’re still doing very well on our U.S. medical malpractice book and that book continues going forward. The book that we’re talking about, the med mal that we’re talking about in the 10-Q, is that Italian program that we canceled at the end of 2008. Amit Kumar – Macquarie Bank: Right. And so this is the same book, which I think American Financial Group and Argo were also talking about?

That, I do not know. I haven’t looked at their releases. Amit Kumar – Macquarie Bank: Okay. I can. And just on the topic of adverse development, on the E&O book regarding the mortgage services, I think the number now is $34.1 million. You talk about one program. Do you think, does this additional adverse development in Q2 give closure to this issue or is it still developing?

I wish I could say it puts a closure to it. We felt like we had a reasonable handle on the mortgage E&O book last quarter. And we had a projection in terms of how many claims we would see as we went forward. And honestly, we’ve seen more claims than we would have expected at this point from the 2007 and 2008 accident year. We have looked at it pretty hard. We’ve put up our very best number but I can’t say at this point that we’re absolutely certain. You are never certain on loss reserves. But we approached this just like we do everything else, which is to be more likely redundant than deficient. But it’s a program that we no longer write. It is coming out of what was sort of, obviously, a mortgage bubble and so it has proven more difficult to get our hands around it than maybe some of our more standard programs. Amit Kumar – Macquarie Bank: Got it. Okay. That’s all. Thanks for the detailed answers. That’s all for now.

Thank you. Our next question is from the line of Beth Malone with Wunderlich Securities. Please proceed with your question. Beth Malone – Wunderlich Securities: Hey. Thank you. Good morning. The decision to acquire a workers’ comp company is a little bit of a deviation from what your all’s historic position has been on workers comp, and I wonder, is this part of a strategy to increase your Admitted business and that part of Markel?

Hi, Beth. Thank you very much for the question. I think the answer to that simply is, yeah. We’ve been talking for the last -- for a long period of time about the three different businesses. And our recent sort of reorganization has been focused on the international business, Markel Specialty, which is the retail business and the Markel One, which is really our wholesale business. And when we reorganized all of our wholesale businesses into the five regions that was really putting all of our wholesale businesses together under one banner. And really, at the same time, we talked about the desire to start putting an equal amount of focus and emphasis on the Markel Specialty businesses, which is specialty product that we can market through the retail channel. So absolutely, we want to build that business and think there’s a huge opportunity for Markel in that space. We’ve historically shied away from workers’ comp because broadly speaking, workers’ comp is in fact a commodity product and it is highly regulated by the states and those are attributes that have made us somewhat fearful of getting too involved in workers’ comp. Why we are so excited about Aspen and FirstComp is that they’ve carved out a specialty niche in the workers’ comp market by focusing on small accounts with small agents in small rural communities. And it is a platform that is web-based, excellent technology to enable the small agents in the small towns to get prices quickly and easily on the internet connections to the service at Aspen and it’s a unique niche within the workers’ comp business that we believe is going to be pretty powerful for Markel going forward. Beth Malone – Wunderlich Securities: Do you anticipate that there is going to be cross-selling opportunities with the E&S book that you have that’s often to smaller businesses?

Not, I mean, E&S is the wrong label to use on that but there’s certainly a lot of Specialty Admitted products that can be marketed through those resources. We’re writing children’s summer camps today across the country through a network of retail agents. Here 9000 new agents that we could offer that product to. So the answer is, yeah, but not, in the excess and surplus by the nature of that term, that is primarily a wholesale product, yeah. Beth Malone – Wunderlich Securities: All right. And then on the Deepwater Horizon loss, has this changed your strategy towards the energy market or how -- what kind of risk you’re going to take or change your reinsurance position?

Absolutely not, in fact, the reverse, I think, we’re seeing more and more opportunities in that sector and that is one of the very, very few places that we’re able to get appropriate prices for the risk.

Yeah. That’s actually a hard market right now. The only hard market I’m aware of is marine energy and liability, and the loss, as I said, inside of our sort of risk management expectations. And so, we continue to write in that market and are very comfortable writing in that market. Beth Malone – Wunderlich Securities: Okay. All right. And then, finally, on the financial, it looked like financial D&O type risk, I guess, this is international. There were some, I was a little confused by the filing in that there was some business that you saw favorable development and some business that you saw unfavorable. I don’t know if I have that right, but can you talk about where you see the financial markets, I think, it’s in the International sector.

Well, I think, maybe, I don’t have it right in front of me. But the places we saw development in the first half of the year in International was, as we’d talked about with Amit, was the Italian medical malpractice. And I don’t know if that was the same thing that was going on with some of the other companies out there. But it was medical malpractice, but a different market, the Italian market, where we saw some development. We also had Australian construction where we saw a little bit of development and we’re not writing Australian accounts now. So I think that will resolve some of those issues going forward. D&O and some of the other areas in our professional liability business in International have performed very well for us. Just like everything else, pricing is tough in all of those lines, but we still see good results coming out of our professional, such as D&O and miscellaneous E&O on the International side. So that helped to offset some of the poor developments -- poor results we saw out of the construction and the med mal. Beth Malone – Wunderlich Securities: Okay. Thank you.

Our next question is from the line of Mark Hughes, SunTrust Robinson. Please proceed with your question. Mark Hughes – SunTrust Robinson: Thank you very much. Does the Aspen transaction suggest a more optimistic view about workers’ comp in the macro sense?

No. I mean, I don’t know that I think that workers’ comp by itself is a great place to be. But I do think there is -- it is a huge market and this is, we’ve looked for specialty areas within the comp market a number of times and I think there are several. This is one that we’ve been able to react to. But broadly speaking, if you asked me do I think I want to compete in the workers’ comp market with the standard carriers and the standard business, the big risks and the like, I would say no. But yeah, I think, this is a unique -- this is the first time we’ve found one that was actionable that was able to put us in a specialty area of that marketplace and it’s specialty because it’s small accounts through small agents in small towns. And a very limited number of business classes. We’re not writing throughputs and a lot of classes where people are exposed to the more severe workers’ comp losses. Now, everybody unfortunately is exposed to bad losses in workers’ comp but these are the more obtained classes in the field. But it does give us now a base of knowledge and hopefully we’ll find a number of other specialties in the comp arena. So it is a big market. I don’t have the total U.S. premiums at the tip of my tongue, but I think its plus or minus somewhere between $25 and $30 billion. It’s been down a lot in the last couple years because, of course, the comp premiums are a function of the payrolls. Mark Hughes – SunTrust Robinson: Right.

And pricing has been depressed for the last couple of years. So it’s not necessarily the best time to generically say let’s jump into the comp market and we will be very, very cautious as we move into it. But it’s -- there are some specialty niches in that area and we look to find them. Mark Hughes – SunTrust Robinson: So in terms of timing on any kind of turn in pricing, you don’t have a particular view on that?

No. I wish I did. The investment world, as Tom was talking about, if you smash all of, I mean, one of the historic problems of comp it’s a very long tail business and when interest rates were higher, there were hundreds and hundreds of companies willing to write to comp at 120% combined ratio to capture the investment leverage. That investment leverage isn’t worth a whole lot today and it’s an area that there is medical inflation and it seems that’s continuing. Comp is at the forefront of medical costs still going up. So there’s a lot of things that one should be very, very cautious about workers’ comp. Mark Hughes – SunTrust Robinson: So the surplus business, new products, new marketing initiatives, I think you suggested the second half would be good for you. Is it possible that we see positive results in terms of gross premium in the second half?

That’s certainly our goal. We would like to see, we were down 11, down 5, we would like that to turn positive before the end of the year. And talking to all our folks out in the field, it’s, I said it is a brutal market out there, but our guys are really excited about the opportunities that they see, the new products that we’ve put out there, the enhancements in products we’ve given them. And they feel like the clients are taking notice and are looking for ways to do business with us. So we certainly would love to see it be up by the end of the year and that’s the goal.

We do also have the sort of the wind is starting to get to our back with regard to our sort of internal reorganization. We’re continually improving on our service levels as we’ve conquered the various problems of our One Markel reorganization. And so that probably caused some headwinds over the last year for Markel. But the other factors, the pricing and our price discipline, as well as, the soft economy are certainly headwinds and whether our service and our new products can overcome that is a bit of a speculation.

On the -- I will say, our people are optimistic and they know that it is underwriting profits first at Markel, but I love to see the optimism they are showing and the enthusiasm they’re showing with everything that we’ve done. I think they feel it. I think our producers are starting to see the power of the model we’ve put in place. And as Steve said, we’ve fixed a lot of the service issues we had initially. I think our service levels are at least back to where we were before and hopefully, we’re charting new ground in terms of service levels from where we were. So we’re pretty optimistic for the second half of the year. But we’re not kidding anybody. It’s the same market we’ve been dealing with.

I think more importantly, Mark, we will be a survivor. We will be the one of the companies that is successful over the next five and 10 and 15 years. The insurance industry has historically had a reasonably high fall-out ratio. The number of companies that have disappeared over the last five, 10, 15, 20 years is not immaterial and we will be one of the survivors and one of the successful ones for the long-term. But we can’t tell what’s going to happen in the next six months. Mark Hughes – SunTrust Robinson: Thank you.

(Operator Instructions) Our next question is from the line of Michael Nannizzi with Oppenheimer. Please proceed with your question, sir. Michael Nannizzi – Oppenheimer: Thank you. Just, first off, for Tom, in the second quarter, it looks like book value or AOCI saw about a $5 reduction. Can you kind of just talk about what happened during the second quarter and what drove that change?

First, you’ll have to remind me what AOCI is. Michael Nannizzi – Oppenheimer: I’m sorry, accumulated.

Other Comprehensive Income. Michael Nannizzi – Oppenheimer: Sorry about that. Yeah.

My day-to-day thinking, I can tell you that isn’t really what I look for. Obviously, the equity markets were softer during the quarter, so during the year, I talked about that we were down 0.9%. Well, we were up about 9% in the first quarter and we were down about, a shade more than 9% in the second quarter and I think that accounts for the bulk of the AOCI, which you described. Michael Nannizzi – Oppenheimer: Right. Okay. So the unrealized gain, loss. Okay. And so was any of that related to, I imagine most fixed income, most fixed income security is marked up because of the yield environments? Okay.

Interest rates were down and we didn’t have any credit problems. Michael Nannizzi – Oppenheimer: Great. Got it. And then, just one question about the acquisition, if I could. I think maybe Steve, you might have said it before, I think, I missed it was, what is the notional book value of Aspen and can we just get an understanding of what the balance sheet looks like a little bit?

I think, the best way to respond to that is just to ask you to wait until we close because at closing we will have a comprehensive review of the loss reserves and the contingent commissions that are referred to in that contingent value right agreement and it will enable us to put out some numbers that make some sense. Aspen has previously been a privately owned business. They do have a number of shareholders but basically have not been a publicly-traded business and the financial statements that were audited were back in December 31, and to some extent, the numbers area a moving target as the year progresses. I think we believe, though, that fundamentally the book of business is going to earn an underwriting profit for Markel and that certainly the loss reserves and the balance sheet that we put on our books when we close will be conservatively stated. Michael Nannizzi – Oppenheimer: Great. Thank you. And then, just on the strategy, the purchase, within specialty do you expect to be writing then more bundled policies, like small business policies and filling out the product assortment that way or just kind of step one, just that the initial cross-sell may be a general liability program or something of that nature or is the first step more the other way, where you start with your legacy policyholders and look to sell them comp through Aspen?

I think step one is continue to grow Aspen and the business that they write today. They are only in 31 states. There’re still some states out there that are on their wish list and so, we certainly want to make sure we support them and help them grow the existing book. And then, we believe we can take some of our Specialty Admitted products to those 9000 agents that Steve talked about. So that’s probably step two, after we make sure we are helping them grow their book. Finally, we -- on the Specialty Admitted side, we write package policies. The only piece we don’t have today is the workers’ comp piece. So bringing that comp piece over to our day cares and our child, our summer camps, all those sorts of things, makes a lot of sense and that’s probably step three. But that’s the order we will approach it in and it will take a little while to get to step two and three because we want to make sure we’re supporting the Aspen folks in growing their business organically. Michael Nannizzi – Oppenheimer: Great. Thanks so much, Richie. And just one last one, if I could, just on expenses. It looked like just from our first look here, the expense ratio is a little bit higher, I guess, part of that is due to topline, maybe and also within the E&S segment, the One Markel initiative. Can you talk about how you think about that run rate expense line within the E&S segment and also within Lloyd’s, for example, where it’s a little bit higher and then also within Specialty and how Aspen might impact that. Thank you very much for answering all my questions.

Sure. Maybe I’ll attempt that one a little bit. In terms of the expense ratio in Markel International this quarter, you have to be a little careful with that. We had over $10 million of reinstatement -- reinsurance reinstatement premiums that are fully earned in the quarter as a result of the Deepwater Horizon loss and so that pumps up the expense ratio. And if you bring it down to a more normalized level, I’m going to say 37, 38, does that sound about right, guys? So that’s throwing things off on the international side. In terms of the U.S. side of the business, we’ve got pretty full bonus accruals up at the moment. However, obviously, we haven’t had a stellar first half of the year but we don’t really dig into bonus accruals until we get to the third quarter. Because that’s really when we are going to have a good idea of how the year is going to within reason where the year is going to land. So, if we don’t start making progress towards the sub 100 territory, some of those bonus accruals are going to come down, obviously. If we have a strong second half of the year then we’ll stay in there. But I think this year compared to last year, we’re a little heavier on bonus accruals but that could easily turn around if we don’t start seeing a solid second half. Michael Nannizzi – Oppenheimer: Okay. And then, the One Markel piece within E&S, I think you said 2 points and is that expectation that will likely continue?

Yeah. That’s probably a pretty good run rate for the rest of the year. Michael Nannizzi – Oppenheimer: Great. Thank you very much, Richie.

Our next question is coming from the line of Jay Cohen with Bank of America. Please proceed with your question. Jay Cohen – Bank of America: Thank you. I’ve got several questions and I could always re-queue if I run out of time. But in the Q, you talk about going into, I guess, some sort of mediation with Guaranty Bank. And I’m wondering as you look at this relationship what the chances are this results in some sort of charge to resolve this.

All I can say on that, Jay, is obviously we’ve had the contingency disclosure for several quarters now. We have started discussions with Guaranty, which of course is positive that we’re talking. And we have reserved for, just like everything else we do at Markel, we try to be more likely redundant than deficient. I don’t think I can really say much more about that at this point, given kind of where we are with that. Jay Cohen – Bank of America: That’s fair. That’s fair. And second question, with Aspen, in the past when you’ve made acquisitions, you didn’t pay up for them and you bought companies that had some underwriting issues and you were able to fix them, partly through shrinking the business. Would you characterize Aspen that way, in fact, if you could just talk about what the combined ratio has been for that business?

No. Aspen is very definitely not a fixer upper and not in the style of a company that’s been distressed in any form or fashion. Aspen has been growing, up until the last couple of years was growing very, very rapidly. The last couple of years their underwriting discipline has caused the premium volumes to actually decline a bit. But in terms of their desire, their increasing, retaining the business that they’re writing has continued to be growing. And some extent, because it was privately-owned and had, I think, a couple rounds of some private equity financing, but didn’t have as much capital as it could use to build and grow the workers’ comp, it was both an underwriting manager and an underwriter, and an underwriting manager has to live and die on commission. And I think they had some choices. One, they could continue to raise money in the private markets and continue to slowly and gradually evolve from an underwriting manager to an underwriter or they’re going forward with Markel and get the benefits of leveraging our resources, as well as some of the cross-marketing opportunities. But they had been recording very, very significant underwriting profits for pretty much their whole history. I mean, they’ve had the occasional state that was ill-advised or something went wrong in and it was not a perfect record by any stretch of the imagination, but it’s a very, very strong one. Jay Cohen – Bank of America: Great. That’s a helpful clarification. And with Aspen, what’s the exposure to California?

About half of their business is California and they’ve been recording in the past respectful results in California. They’ve been achieving significant rate increases as well in the last couple of years. One of the difficulties and why there is a contingent value aspect to this transaction is that the book is not 20-year seasoned. In some states, it is only three or four years old. In other states it might be 10 years old. But the book of business, as you know workers’ comp is a fairly long tailed business and there is some uncertainty about what the ultimate reserves would be. Both of us, both Aspen and Markel believe that the business is profitable. I think it’s fair to say Aspen believes it’s more profitable than we do. And there’s a difference of opinion that will be resolved through this contingent value agreement. But part of that is not knowing with precision that the small and rural and class of business they write are necessarily as much better than the average comp. And so if you look at loss development triangles for comp in general, it’s not all that easy to pick it out for a book of business that exactly mirrors Aspen’s underwriting style, which is small accounts in small towns. And so, we’ll overtime learn that and ultimately the shareholders of Aspen will receive the appropriate compensation for their shares. Jay Cohen – Bank of America: Got it. And then, one last question and then I’ll re-queue. Was there are any spillover in the second quarter from the Chilean quake?

No. Those numbers have held pretty solid. Jay Cohen – Bank of America: Great. And then, just one last -- just a comment. When you talk about the quarterly results, you obviously tend to focus on, in this case, the first half. As a user of your financial statements, for me and I assume it’s with others, I would prefer to hear more comments on the quarter itself, which for us is kind of the new information, just, again, a commentary, do with it what you’d like?

Thank you, Jay.

Our next question is from the line of Mark Dwelle with RBC Capital Markets. Please proceed with your question. Mark Dwelle – RBC Capital Markets: Yeah. Good morning. I think most of my questions have been answered. But I think, Richie, you commented that, I think, I heard you just say that more of the Elliott Special Risks premiums were going to be coming over onto Markel International’s books over the second half of the year. Is that correct?

Yeah. That is, we obviously purchased Elliott in order to underwrite almost all of the business that they were producing. And the various agreements they had with previous markets, the last of those came up in July. So as of the first of July, we are retaining virtually all of that business and then, we bought reinsurance where necessary behind that business. So, in the second half of the year, the Elliott business should pick up substantially. Mark Dwelle – RBC Capital Markets: Okay. And then by way of just thinking about that, I mean, I know historically you usually retain a pretty high proportion of your risk, I mean, as far as where you are reinsuring that, is it significantly below your overall average or maybe said the other way, are you retaining less than your overall average?

Retention should look pretty similar to our overall book on that business. Mark Dwelle – RBC Capital Markets: And what sort of lines will be picked up as a result?

The policy limits, you mean? Mark Dwelle – RBC Capital Markets: No. I just mean in terms of lines of business.

It’s professional liability business, so it’s a lot of errors and omissions business, some product liability and umbrella business. So it’s the kind of stuff we really like. Mark Dwelle – RBC Capital Markets: Okay. I think that’s all my questions then. Thanks.

Our next question is from the line of Meyer Shields with Stifel Nicolaus. Please proceed with your question. Meyer Shields – Stifel Nicolaus: Hey. Good morning, all. I apologize if I missed this. Is there any reinsurance protection against adverse development on Aspen’s reserves or is it just in terms of the ultimately upper price?

Aspen has a meaningful amount of its own reinsurance and it’s been participants in somewhat of a pool. And so they’ve had other companies writing the business in certain states and they act as a reinsurer and the same company participates in reinsurance behind them. And so, over the years, Aspen has had a number of reinsurance treaties protect them. And going forward, after the acquisition, between now and the acquisition, Markel will start participating in some of those pools. And then after the acquisition and as we evolve, more and more of the business obviously will become written on Markel paper and we’ll own the FirstComp paper that’s being used and will structure the reinsurance overtime as makes sense for Markel. Meyer Shields – Stifel Nicolaus: Okay. But no policy particularly focused on the…

No. We didn’t buy special… Meyer Shields – Stifel Nicolaus: Okay.

… coverage for that. However, the shareholders of Aspen are receiving a contingent value note that will reflect the ultimate development as it relates to the reserves. Meyer Shields – Stifel Nicolaus: Okay. That’s helpful. On a related note, NCCI has a theory that during recessions, workers’ compensation business is more profitable because the people most likely to get injured tend to lose their jobs early in a recession. They talk about that with regard to high-hazard classes and I know you’ve described Aspen as basically being low-hazard. I was wondering whether that sort of trend shows up at all?

Yeah. You know, I’m not an expert in that, so any comment I make is purely an opinion, not steeped in a lot of fact. But Aspen’s business, as you point out, is not the high-hazard classes. I think there is some validity that in a recession, if people are worried about their jobs and they have an injury and they can keep their job, they are less likely to report a claim so that they can keep the job. Likewise, if someone has an injury and gets laid off and can’t get another job, I think that claim is more likely than not to get worse. And what the balance of power between those two forces is at any point in time, I don’t know the answer to that. I think the biggest impact on the comp market over the last several years has been the fact that payrolls are down a whole lot and therefore, the number of employees at work is down and the frequency is down because the number of employees are down. Meyer Shields – Stifel Nicolaus: Yeah. Clearly, that is clobbering the market. On a related note, I know [Anon] has been talking about retaining all of this wholesale risk and running it through [Anon] offices in London rather than sending it to third-party wholesalers. Is that affecting new business submissions for Markel at all?

Yeah. We’ve clearly heard about all that. I don’t think it has a particularly huge impact on us and we’ll see if they are able to accomplish it. But I sensed it was more revenue sharing between the U.S. and London and all those sorts of things. You get into some interesting politics around those sorts of things sometimes. But I think in terms of the markets, in terms of the carriers, I haven’t seen how it’s going to affect us. Meyer Shields – Stifel Nicolaus: Okay. Great. Thanks so much, guys.

Thank you. Our next question is from David West with Davenport & Company. Please proceed with your question. David West – Davenport & Company: Good morning. Following up on the expense ratio question, I think, Anne, in her comments in the 10-Q, you mentioned profit sharing accruals. Could you put some dollar figure around that?

I’m not sure I have the dollar figure, David. We did make some reductions to the profit sharing provisions in the second quarter of ‘09, so that’s where some of the variance in the current period is coming from. I’m looking to see if it’s out anywhere on the table.

Dave, we might catch you offline and help you out with that. David West – Davenport & Company: Okay. Very good. And then, just one other question. You got the new credit facility in place this quarter, $270 million. You mentioned that you under certain terms and conditions, you can’t increase that to $350 million. Could you outline what those terms and conditions are?

I think it just has the typical accordion feature in it that we can increase, we can bring additional banks in just to increase it to $350 million. I don’t think there is anything particularly onerous in terms of terms and conditions to do that. It just gave us a little flexibility. David West – Davenport & Company: All right. Very good. And maybe one corollary to that, when you do the Aspen deal, do you probably intend to tap that line of credit or you look like you have pretty ample balance sheet liquidity. Would you tend to use cash on hand?

The current plan is to use cash on hand at the holding company. David West – Davenport & Company: Okay. Very good. Thanks so much.

Thank you. Our next question is a follow-up from the line of Amit Kumar with Macquarie. Please proceed with your question. Amit Kumar – Macquarie Bank: Thanks. Two quick questions, I guess, on Aspen. First of all, this deal was announced on July 12th. I’m wondering, did your actuaries look at the ‘09 schedule piece or did they look at the six-month 2010 loss triangles for them?

All of the above. Amit Kumar – Macquarie Bank: Okay. Can you, what was their view? Did they feel that there were, like there was a good cushion, were they at the midpoint, maybe can you just give us some more comfort? I guess, what I’m trying to ask is if you look at some of the other comp companies, recently they’ve added to reserves in Q2. They talk about this phenomenon of medical cost which is being stretched because people are unemployed and they’re not going back. I’m just trying to get some comfort that the same issues won’t show up at FirstComp? That would be very helpful.

I think the answer is the issues could very well show up at FirstComp. We do not believe they will but its workers’ comp business. And what we have done is taken what we think is a measured look at the classes of business, the states they’re writing in, their historical development, the way they handle the claims. We’ve looked at the individual claims styles and we’ve done all of the normal due diligence things. And as we know very well, in doing due diligence on another company, there is no way to do it perfectly. And what we don’t know, unfortunately, we will not -- we won’t know for until we do know it and that’s just a fact of life. In doing the purchase, we’ve structured the purchase price with the contingent value agreement so that there is a very significant bridge between sort of a conservative and an optimistic view of the loss reserves and some other balance sheet items related to Aspen’s balance sheet. From our perspective, the much, much more important issue is our assessment about our ability to make underwriting profits on a going forward basis. And we believe very strongly that in this small business market with small agents and small towns, that we will, with Aspen’s platform be able to write workers’ compensation at an underwriting profit. Amit Kumar – Macquarie Bank: Okay. That’s actually very helpful. Just a final question. Aspen has roughly 550 employees. Do you expect to retain all of those or there could be some changes on that -- on the expense side from them?

I don’t think there’ll be any changes because of our acquisition of Aspen. In fact, if we’re successful in building out new states and expanding Aspen’s business, that number possibly can and should increase. We currently do virtually no -- we do no workers’ compensation. And so in terms of skill set in underwriting, in terms of the claims handling, in terms of the processing of this business, there’re very, very few opportunities for integration of operations. Clearly, when it comes to capital allocation and investments, and some other corporate functions, cash management and the like, we’ll certainly seek to find some efficiencies in operations. But it’s certainly not going to impact a meaningful number of people. And to the extent that there are overlaps, my guess is that we will find very, very good uses for those people. So in terms of the employment count, the transaction by itself will not generate any headcount reductions. Amit Kumar – Macquarie Bank: Got it. Okay. Thanks. Thanks for the detailed answers.

Thank you. Our final question today is from the – follow-up from the line of Jay Cohen with Bank of America. Please proceed with your question. Jay Cohen – Bank of America: Yeah. Thank you. Just a quick one. On the Markel International business, can you give us a sense if currency impacted the premium growth in the quarter?

I think, it actually -- I think we were, the headline number, I think we were up 10% and if you took out currency, we were up 8% and that was for the six months. Do we have it for the quarter?

One minute. Hold down.

Jay, we can get it for you for the quarter, but I think it benefited us 2 points for the six months, 10 versus 8. Jay Cohen – Bank of America: Great. All right. Thanks. If you do have the quarter, that would be very helpful.

Okay. Jay Cohen – Bank of America: Thanks a lot.

All right. Thank you.

Thank you. There are no further questions at this time. I would now like to turn the floor back over to management for closing comments.

Thanks very much. I’d like to thank all of you for your participation in today’s call. And as always, if you have any further questions or comments, don’t hesitate to give us a call and thank you very, very much for your loyal support of Markel. Have a great day.

This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.