Goran Capital Inc. Reports Second Quarter 2000 Results

10 August 2000

    TORONTO - Goran Capital Inc. , a major crop and automobile insurance carrier 
reported results to June 30, 2000.

    The Company's gross written premium reduced approximately 16% to
$275,359,000 for the six months ended June 30, 2000 compared to $325,892,000
for the same period last year.  Operating loss excluding realized loss on
investments to June 30, 2000 was $688,000 compared to an operating loss of
$7,085,000 for the same period of 1999.  The Company has not taken credit for
tax recoveries in the six-months ended June 30, 2000 compared to $8,711,000 of
credits taken in the same period last year.  After distribution of the
$6,247,000 preferred securities a net loss of $8,738,000 is shown compared to
a loss of $5,716,000 which includes a tax credit of  $8,711,000.  The net loss
per share fully diluted was $1.49 compared to $.97 in the same period a year
ago.

    The lack of tax credits means the Company will not report income taxes
against future pre-tax earnings until it has depleted the total allowances for
deferred taxes of approximately $27,000,000.  In addition the Company will
report full results from its subsidiary including minority interest until it
has used up the minority interest losses absorbed totaling approximately
$10,000,000.

    The Company continues to make significant strides to reduce expenses and
debt. Total employees and temporary staff have been reduced by 14% from 941 at
December 31, 1999 to 812 at June 30, 2000. Gorans' subsidiaries Granite
Reinsurance Company Ltd. and Granite Insurance Company purchased $23,000,000
of Symons International Group, Inc.'s trust preferred shares in the open
market for $2,810,000.  This purchase increased the equity of Goran by
$21,763,000 and retains in the Company $374,000 of current interest payments.
Granite Re reported a year to date profit of $3,346,000.  Significant
highlights of the Company's two divisions are as follows:

    Nonstandard Automobile Insurance Operations

    The nonstandard auto insurance operations continue to add new management
while rebuilding the Company.  The gross written premium is lower this year as
under-priced business is replaced through rate increases and stricter
underwriting policy.  These improvements have resulted in approximately a 10%
rate increase over that of last year.  The loss of $10,037,000 to June 30,
2000 includes a draw down of deferred acquisition expense and the carrying
cost of severance and surplus staff as the business was reduced in size.
Reserves for the nonstandard auto division are reducing as a redundancy in
prior period reserves are being realized. The combined ratio for the
nonstandard operations has reduced from 123.5% at December 31, 1999 to 117.5%
at June 30, 2000.

    Crop Insurance Operations

    The crop operations reported earnings to June 30, 2000 of $7,157,000 on
slightly lower premium of $185,468,000 compared to earnings of $3,369,000 with
premium of $198,247,000 this period last year.  Sales of MPCI were strong this
year, however farmers generally purchased less hail insurance.  The crop
conditions remain favorable year to date.

    These results reflect good progress to return the Company to profits in
the future.

    The Company will host a conference call on August 10, 2000 at 3:30 p.m.
Central Time.  The conference call may be accessed by calling 800-370-0869 in
the United States or 973-633-1010 internationally.  Ask for the Goran Capital
conference call.  Replay will be available for 30 days by dialing
800-345-6275.

    Goran Capital Inc. has two main divisions.  Superior Insurance Group is a 
major writer of nonstandard automobile insurance in the United States.  
Nonstandard auto insurance is sold through independent insurance agents and 
generally carries higher premiums and low limits of liabilities.  Goran's 
subsidiary, Superior Insurance Group, writes nonstandard auto insurance in 22 
states.  IGF Insurance Company is the fifth largest insurer of crops in the 
United States and writes business in 46 states. 

                              GORAN CAPITAL INC.
                      Consolidated Financial Highlights
                          (unaudited Stated in US$)

                            STATEMENT OF EARNINGS

                                           For the Three Months
                                              Ended June 30,
                                         2000               1999
                                           $                  $

    REVENUE
    Gross premiums written            131,140,000         173,870,000
    Net premiums written               30,542,000          79,150,000
    Premiums earned                    44,984,000          76,527,000
    Fee income                          3,855,000           3,153,000
    Net investment income               2,650,000           3,507,000
    Net realized capital gain/(loss)   (1,681,000)            366,000
      Total                            49,808,000          83,553,000

    EXPENSES
    Claims expenses                    35,701,000          72,293,000
    Operating expenses                 15,692,000          21,015,000
    Amortization of intangibles           735,000             651,000
    Interest expense                       23,000             105,000
      Total                            52,151,000          94,064,000

    Income before income taxes,
      minority
    Net income before the following    (2,343,000)        (10,511,000)
    Provision (Benefit) for
      income taxes                             --          (4,705,000)
    Minority interest                          --          (3,149,000)
    Distributions on Preferred
     Securities                         2,983,000           3,225,000

    NET EARNINGS (LOSS)                (5,326,000)         (5,882,000)

    Net Earnings per share - Basic         ($0.91)             ($1.00)
    Net earnings per share - Fully
     diluted                               ($0.91)             ($1.00)
    Net earnings per share - Operating     ($0.62)             ($1.04)



                                           For the Six Months
                                              Ended June 30,
                                         2000                1999
                                           $                   $
    REVENUE
    Gross premiums written            275,359,000         325,892,000
    Net premiums written               69,971,000         146,421,000

    Premiums earned                    92,384,000         143,651,000
    Fee income                          7,646,000           7,617,000
    Net investment income               5,898,000           7,015,000
    Net realized capital gain/(loss)   (1,316,000)           (956,000)
      Total                           104,612,000         157,327,000
    EXPENSES
    Claims expenses                    74,494,000         131,288,000
    Operating expenses                 30,630,000          32,645,000
    Amortization of intangibles         1,266,000           1,256,000
    Interest expense                      226,000             179,000
      Total                           106,616,000         165,368,000

    Income before income taxes,
      minority
    Net income before the following    (2,004,000)         (8,041,000)

    Provision (Benefit) for
      income taxes                        487,000          (5,195,000)
    Minority interest                          --          (3,516,000)
    Distributions on Preferred
     Securities                         6,247,000           6,386,000

    NET EARNINGS (LOSS)                (8,738,000)         (5,716,000)

    Net Earnings per share - Basic         ($1.49)             ($0.97)
    Net earnings per share - Fully
     diluted                               ($1.49)             ($0.97)
    Net earnings per share - Operating     ($1.26)             ($0.87)


                                          June 30,           December 31,
    BALANCE SHEET (US$)                     2000                1999
                                              $                   $
    ASSETS
    Cash and investments                 190,031,000         231,424,000
    Due from insureds and reinsurers     383,564,000         190,998,000
    Other receivables                      1,661,000           8,466,000
    Property and equipment                20,479,000          21,967,000
    Deferred acquisition costs            10,151,000          13,920,000
    Intangibles                           43,850,000          43,812,000
    Other assets                          12,575,000           9,335,000

      Total                              662,311,000         519,922,000

    LIABILITIES
    Outstanding claims                   168,577,000         219,918,000
    Unearned premiums                    192,150,000          90,007,000
    Bank debt                              4,582,000          16,929,000
    Other payables                       185,309,000          70,955,000

      Total                              550,618,000         397,809,000

    MINORITY INTEREST
    Preferred securities                 112,000,000         135,000,000
    Equity in net assets of subsidiary            --                  --

    SHAREHOLDERS' EQUITY (DEFICIT)          (307,000)        (12,887,000)

        Total                            662,311,000         519,922,000

    Outstanding shares at period end       5,776,398           5,876,398

    Net Book Value per share                  ($0.05)             ($2.19)


                                           June 30,             June 30,
    STATEMENT OF CASH FLOWS (US$)            2000                1999
                                               $                   $
    OPERATING ACTIVITIES
    From operations                       (8,738,000)         (5,716,000)
    Change in net assets                 (14,494,000)         19,465,000
    Cash provided (used) by operations   (23,232,000)         13,749,000

    INVESTING ACTIVITIES

    Net (purchases) sales of investments  25,833,000          (8,660,000)
    Net purchases of fixed assets         (1,197,000)         (3,685,000)
    Redemption of share capital
      & min int                           (2,916,000)                 --
    Other                                         --            (126,000)
    Cash used in investing                21,720,000         (12,471,000)

    FINANCING ACTIVITIES
    Net purchase minoroty interest                --                  --
    Increase (decrease) in notes
      payable                            (12,347,000)           (309,000)
    Issue of share capital                        --                  --
    Loans to related parties                      --                  --
    Cost of shares acquired                       --                  --
    Other                                         --                  --
    Cash provided by financing           (12,347,000)           (309,000)

    Change in cash resources             (13,859,000)            969,000

    Cash resources beginning of period    35,807,000          42,759,000

    Cash resources end of period          21,948,000          43,728,000

    Cash resources are comprised of cash and short-term investments

                              GORAN CAPITAL INC.
                      Consolidated Financial Highlights
                               (Stated in US$)

    Three Months Ended June 30, 2000                 OTHER AND
                          AUTO            CROP       CORPORATE       TOTAL

    Gross premiums
     written           29,868,000     101,108,000     164,000     131,140,000
    Net premiums
     written           19,346,000      10,379,000     817,000      30,542,000

    Premiums earned    37,377,000       6,501,000   1,106,000      44,984,000
    Fee income          3,631,000         194,000      30,000       3,855,000
    Net investment
     income             2,453,000         (40,000)    237,000       2,650,000
    Net realized
     capital gain      (1,682,000)              0       1,000      (1,681,000)
       Total revenue   41,779,000       6,655,000   1,374,000      49,808,000

    Claims expenses    29,184,000       7,894,000  (1,377,000)     35,701,000
    Operating expenses 18,053,000      (4,655,000)  2,294,000      15,692,000
    Amortization of
      intangibles              --         246,000    (223,000)         23,000
    Interest expense           --          23,000     712,000         735,000
       Total expenses  47,237,000       3,508,000   1,406,000      52,151,000

    Income (loss) before
      the following    (5,458,000)      3,147,000     (32,000)     (2,343,000)

    Income taxes
    Minority interest
    Distributions on
      preferred securities     --              --          --       2,983,000

    Earnings from continuing operations                (5,326,000)

    Net earnings (loss)        --              --          --      (5,326,000)

    Loss ratio               78.1%             --          --              --
    Expense ratio, net
      of billing fees        38.6%             --          --              --
    Combined ratio          116.7%             --          --              --


    Three Months Ended June 30, 1999                OTHER AND
                          AUTO            CROP      CORPORATE         TOTAL

    Gross premiums
     written           66,072,000     107,524,000     274,000     173,870,000
    Net premiums
     written           64,154,000      11,633,000   3,363,000      79,150,000

    Premiums earned    66,836,000       6,074,000   3,617,000      76,527,000
    Fee income          2,895,000         197,000      61,000       3,153,000
    Net investment
     income             3,296,000         (18,000)    229,000       3,507,000
    Net realized
     capital gain         366,000               0           0         366,000
      Total revenue    73,393,000       6,253,000   3,907,000      83,553,000

    Claims expenses    61,631,000       8,894,000   1,768,000      72,293,000
    Operating expenses 23,609,000      (4,654,000)  2,060,000      21,015,000
    Amortization of
     intangibles               --         141,000     510,000         651,000
    Interest expense           --         105,000           0         105,000
      Total expenses   85,240,000       4,486,000   4,338,000      94,064,000

    Income (loss) before
     the following    (11,847,000)      1,767,000    (431,000)    (10,511,000)

    Income taxes               --              --          --      (4,705,000)
    Minority interest          --              --          --      (3,149,000)
    Distributions on
     preferred securities      --              --          --       3,225,000

    Net earnings (loss)        --              --          --      (5,882,000)

    Loss ratio               92.2%             --          --              --
    Expense ratio, net
     of billing fees         31.0%             --          --              --
    Combined ratio          123.2%             --          --              --

                              GORAN CAPITAL INC.
                      Consolidated Financial Highlights
                               (Stated in US$)

    Year-to-date June 30, 2000
                          AUTO            CROP      CORPORATE        TOTAL

    Gross premiums
     written           89,437,000     185,468,000     454,000     275,359,000
    Net premiums
     written           49,815,000      17,949,000   2,207,000      69,971,000

    Premiums earned    80,418,000       9,434,000   2,532,000      92,384,000
    Fee income          7,565,000          35,000      46,000       7,646,000
    Net investment
     income             5,313,000          86,000     499,000       5,898,000
    Net realized
     capital gain      (1,317,000)          1,000           0      (1,316,000)
      Total revenue    91,979,000       9,556,000   3,077,000     104,612,000

    Claims expenses    66,403,000      10,334,000  (2,243,000)     74,494,000
    Operating expenses 35,613,000      (8,447,000)  3,464,000      30,630,000
    Amortization of
     intangibles               --         286,000     980,000       1,266,000
    Interest expense           --         226,000           0         226,000
      Total expenses  102,016,000       2,399,000   2,201,000     106,616,000

    Income (loss) before
     income taxes and
     distributions on
     preferred
     securities       (10,037,000)      7,157,000     876,000      (2,004,000)

    Income taxes               --              --          --         487,000
    Minority interest
    Distributions on
     preferred securities,
     net of tax                --              --          --       6,247,000

    Earnings from continuing operations                (8,738,000)

    Net earnings (loss)        --              --          --      (8,738,000)

    Loss ratio               82.6%             --          --              --
    Expense ratio, net
     of billing fees         34.9%             --          --              --
    Combined ratio          117.5%             --          --              --

    Year-to-date June 30, 1999
                          AUTO           CROP       CORPORATE        TOTAL

    Gross premiums
     written          127,243,000     198,247,000     402,000     325,892,000
    Net premiums
     written          137,840,000      13,246,000  (4,665,000)    146,421,000

    Premiums earned   132,233,000       5,014,000   6,404,000     143,651,000
    Fee income          7,417,000         138,000      62,000       7,617,000
    Net investment
     income             6,460,000          39,000     516,000       7,015,000
    Net realized
     capital gain      (1,016,000)             --      60,000        (956,000)
      Total revenue   145,094,000       5,191,000   7,042,000     157,327,000

    Claims expenses   112,944,000      14,068,000   4,276,000     131,288,000
    Operating expenses 43,204,000     (12,662,000)  2,103,000      32,645,000
    Amortization of
     intangibles               --         237,000   1,019,000       1,256,000
    Interest expense           --         179,000           0         179,000
      Total expenses  156,148,000       1,822,000   7,398,000     165,368,000

    Income (loss) before
     income taxes and
     minority
     interest         (11,054,000)      3,369,000    (356,000)     (8,041,000)

    Provision for
     income taxes              --              --          --      (5,195,000)
    Minority interest          --              --          --      (3,516,000)
    Distributions on Pref
     Sec, net of tax           --              --          --       6,386,000

    Earnings from continuing operations                (5,716,000)

    Net Earnings (Loss)        --              --          --      (5,716,000)

    Loss ratio               85.4%             --          --              --
    Expense ratio, net
     of billing fees         27.1%             --          --              --
    Combined ratio          112.5%             --          --              --