NATIONAL ASSURANCE INDEMNITY COMPANY ORDERED INTO LIQUIDATION

CHICAGO, IL -- National Assurance Indemnity Company, Chicago, Illinois was declared insolvent and placed into liquidation on January 3, 1997 by the Circuit Court of Cook County. The Order was granted in response to a petition filed by Illinois Director of Insurance, Mark Boozell, based on the Insurance Department's finding that the company's policyholder surplus was impaired in excess of $2.5 million.

National Assurance's most recent annual statement reflects approximately $10.3 million in direct and assumed reinsurance premium as of December 31, 1995; however, the company has not been actively writing new business since a Cease and Desist Order was issued by the Department of Insurance in early December.

The company was ordered into conservation on December 10, 1996, and will continue under the Director's control.

National Assurance Indemnity Company is a wholly owned subsidiary of Coronet Insurance Company, of Chicago, which itself was placed into liquidation on December 24, 1996. The company is licensed only in the state of Illinois, and has concentrated its business writings in assumed reinsurance from its parent (Coronet), as well as a small book of non-standard automobile coverages in Illinois.

In addition to Coronet and National Assurance, a third Illinois affiliate, Crown Casualty Company, was also ordered into conservation on December 10, 1996 and will continue under the Director's control, pending the Director's continued review of its financial condition.

Policyholders will be notified that all policies protected by the Illinois Insurance Guaranty Fund will be canceled as of 12:01 a.m. February 3, 1997, unless they expire or are terminated at an earlier date. The Guaranty Fund will be responsible for the covered claims of the company's policyholders.

The liquidation of National Assurance, as well as the continued conservation activities of its affiliate are being handled by the Director's Office of the Special Deputy Receiver, 222 Merchandise Mart Plaza, Suite 1450, Chicago, Illinois 60654; (312) 836-9500.