<PAGE>   1

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON D.C.  20549

                                 ______________

                                   FORM 10-Q

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
                            EXCHANGE ACT OF 1934
                     FOR THE PERIOD ENDED MARCH 31, 1997

                                       OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
                            EXCHANGE ACT OF 1934
                         COMMISSION FILE NUMBER 1-14094


                       MEADOWBROOK INSURANCE GROUP, INC.
             (Exact name of registrant as specified in its charter)


          MICHIGAN                                              38-2626206
(State of Incorporation)                  (IRS Employer Identification No.)


              26600 TELEGRAPH ROAD, SOUTHFIELD,  MICHIGAN   48034
               (Address, zip code of principal executive offices)

                                 (810) 358-1100
              (Registrant's telephone number, including area code)

                              ___________________

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes _X_     No __

The aggregate number of shares of the Registrant's Common Stock, $.01 par
value, outstanding on May 12, 1997 was 8,658,831.
Total number of Pages: _12_



<PAGE>   2




                               TABLE OF CONTENTS



                                                               PAGE
                                                               ----
PART I - FINANCIAL INFORMATION
                                                               
                                                        
                                                        
ITEM 1 - FINANCIAL STATEMENTS                           
           Condensed Consolidated Statement of Income               3
           Condensed Consolidated Balance Sheet                     4
           Condensed Consolidated Statement of Cash Flows           5
           Management Representation                                6
                                                        
                                                        
                                                        
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS           
         OF FINANCIAL CONDITION AND RESULTS OF            
         OPERATIONS                                                7-10
                                                        
                                                        
                                                        
PART II - OTHER INFORMATION                             
                                                        
                                                        
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K                            11
                                                        
                                                        
                                                        
SIGNATURES                                                           12



                                       2



<PAGE>   3


                         PART I - FINANCIAL INFORMATION
                         ITEM 1 - FINANCIAL STATEMENTS



                       MEADOWBROOK INSURANCE GROUP, INC.
                   CONDENSED CONSOLIDATED STATEMENT OF INCOME
                      FOR THE THREE MONTHS ENDED MARCH 31,
                                  (UNAUDITED)



<TABLE>
<CAPTION>
                                                    1997              1996      
                                                 -----------       -----------  
<S>                                              <C>               <C>          
                                                                                
Revenues:                                                                       
   Net premium earned                            $14,790,662       $21,265,718  
   Net commissions and fees                        5,640,032         4,598,025  
   Net investment income                           1,947,023         2,002,043  
   Miscellaneous income                               -                  4,906  
                                                 -----------       -----------  
       Total Revenues                             22,377,717        27,870,692  
                                                                                
                                                                                
Expenses:                                                                       
   Loss and loss adjustment expenses              14,785,019        19,148,822  
   Reinsurance recoveries                         (6,905,973)       (7,439,800) 
                                                 -----------       -----------  
   Net loss and loss adjustment expenses           7,879,046        11,709,022  

   Other operating expenses                        4,318,675         6,701,106  
   Salaries and employee benefits                  6,253,665         5,925,546  
   Interest on notes payable                          10,154            -       
                                                 -----------       -----------  
       Total Expenses                             18,461,540        24,335,674  

       Income before income taxes                  3,916,177         3,535,018  
                                                                                
Federal income taxes:                                                           
   Current                                           904,268           788,871  
   Deferred                                           39,014           (26,518)  
                                                 -----------       -----------  
       Total income taxes                            943,282           762,353  
                                                 -----------       -----------  
       Net income                                $ 2,972,895       $ 2,772,665  
                                                 ===========       ===========  
                                                                                
Primary and fully diluted earnings per share         $0.33             $0.30    
                                                                                
Weighted average number of common shares and                                    
   common share equivalents outstanding            9,133,009         9,264,303  
</TABLE>




                                       3



<PAGE>   4


                       MEADOWBROOK INSURANCE GROUP, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEET




<TABLE>
<CAPTION>
                                     ASSETS
                                                                          (UNAUDITED)                     
                                                                            MARCH 31,        DECEMBER 31, 
                                                                              1997               1996         
                                                                          ------------       ------------ 
<S>                                                                       <C>                <C>          
Investments:                                                                                              
   Debt securities held to maturity, at amortized cost                                                    
       (fair value of $118,793,542 and $122,485,366)                      $117,731,604       $120,116,668 
   Debt securities available for sale, at fair value                                                      
       (cost of $17,111,790 and $16,025,804)                                16,708,156         15,955,481 
   Equity securities available for sale, at fair value                                                    
       (cost of $3,711,089 and $1,562,999)                                   4,031,579          1,420,949 
Cash and cash equivalents                                                    9,694,634         19,002,241 
                                                                          ------------       ------------ 
       Total investments and cash and cash equivalents                     148,165,973        156,495,339 
Premiums and agent balances receivable                                      36,526,377         25,907,407 
Reinsurance recoverable on:                                                                               
   Paid losses                                                               7,191,765          6,672,133 
   Unpaid losses                                                            29,111,139         26,615,052 
Deferred policy acquisition costs                                            4,720,114          4,264,795 
Prepaid reinsurance premiums                                                21,315,719         20,271,068 
Other assets                                                                23,399,517         24,809,547 
                                                                          ------------       ------------ 
   Total assets                                                           $270,430,604       $265,035,341 
                                                                          ============       ============ 
                                                                                                          
                      LIABILITIES AND SHAREHOLDERS' EQUITY                                                
                                                                                                          
LIABILITIES:                                                                                              
Reserve for losses and loss adjustment expenses                            $92,686,456        $92,390,227 
Unearned premiums                                                           47,636,675         44,090,675 
Notes payable, bank                                                          1,000,000            -       
Other liabilities                                                           25,943,480         28,353,605 
Commitments and contingencies                                                  -                  -       
                                                                          ------------       ------------ 
    Total liabilities                                                      167,266,611        164,834,507 
                                                                          ------------       ------------ 
SHAREHOLDERS' EQUITY:                                                                                     
Common stock, $.01 stated value; authorized 20,000,000 shares;                                            
    8,658,831 and 8,649,346 shares issued and outstanding                       86,588             86,493 
Additional paid-in capital                                                  72,951,450         72,873,396 
Retained earnings                                                           30,180,830         27,381,111 
Unrealized depreciation on available for sale securities,                                                 
    net of deferred federal income taxes                                       (54,875)          (140,166)
                                                                          ------------       ------------ 
    Total shareholders' equity                                             103,163,993        100,200,834 
                                                                          ------------       ------------ 
        Total liabilities and shareholders' equity                        $270,430,604       $265,035,341 
                                                                          ============       ============ 
</TABLE>




                                       4



<PAGE>   5


                       MEADOWBROOK INSURANCE GROUP, INC.
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                      FOR THE THREE MONTHS ENDED MARCH 31,
                                  (UNAUDITED)



<TABLE>
<CAPTION>
                                                                               1997                    1996           
                                                                        ----------------         ----------------      
<S>                                                                     <C>                      <C>              
Net cash (used in) provided by operating activities                      $    (6,045,813)        $      6,956,124      
                                                                        ----------------         ----------------      
Cash flows from investing activities:                                                                                  
    Purchase of debt securities held to maturity                                 -                    (16,740,043)      
    Purchase of debt securities available for sale                            (5,338,366)                 -                
    Purchase of equity securities available for sale                          (2,365,362)                 -                
    Proceeds from maturity of debt securities held to maturity                 2,319,439                1,106,469       
    Proceeds from sale of debt securities available for sale                   4,280,956                  -                
    Proceeds from sale of equity securities available for sale                   232,045                   25,097       
    Proceeds from the sale of furniture and equipment                            399,820                  -                
    Capital expenditures                                                        (627,224)                (475,765)       
    Purchase of subsidiary                                                    (2,995,293)                 -                
                                                                        ----------------         ----------------      
        Net cash used in investing activities                                 (4,093,985)             (16,084,242)       
                                                                        ----------------         ----------------      
Cash flows from financing activities:                                                                                  
    Additional expenses from initial public offering                             -                        (38,315)       
    Proceeds from bank loan                                                    1,000,000                  -        
    Dividends paid on common stock                                              (172,987)                 -        
    Retirement of common stock                                                   (84,446)                 -        
    Issuance of common stock                                                      89,624                  -        
                                                                        ----------------         ----------------      
       Net cash provided by (used in) financing activities                       832,191                  (38,315)        
                                                                        ----------------         ----------------      
Decrease in cash and cash equivalents                                         (9,307,607)              (9,166,433)        
Cash and cash equivalents, beginning of period                                19,002,241               41,906,577        
                                                                        ----------------         ----------------      
Cash and cash equivalents, end of period                                $      9,694,634         $     32,740,144        
                                                                        ================         ================        
</TABLE>




                                       5



<PAGE>   6


                           MANAGEMENT REPRESENTATION



In the opinion of management, the financial statements reflect all adjustments
of a normal recurring nature necessary for a fair presentation of the interim
periods.  Preparation of financial statements under GAAP requires management to
make estimates.  Actual results could differ from those estimates.  Interim
results are not necessarily indicative of results expected for the entire year.
These financial statements should be read in conjunction with the Company's
1996 Annual Report to Shareholders, as filed on Form 10-K to the Securities and
Exchange Commission.


                                       6



<PAGE>   7


                         PART I - FINANCIAL INFORMATION
                                     ITEM 2

                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                 FOR THE QUARTERS ENDED MARCH 31, 1997 AND 1996



RESULTS OF OPERATIONS

Net income for the three months ended March 31, 1997 was $3.0 million, an
increase of $200,000 , or 7.2% from $2.8 million for same period in 1996. This
increase was the result of the combination of the following items.  Net earned
premiums declined $6.5 million and losses and loss adjustment expenses (LAE)
decreased $3.8 million over the prior year primarily due to the reinsurance
transfer of the surety bond business to Connecticut Surety, and partially due
to decreases in residual market assessments and programs consciously
discontinued by the Company.  Commissions and fees have increased $1.0 million 
as a result of additional revenue generated from the Association Self Insurance
Services, Inc. (ASI) acquisition in November of 1996.  Salaries and employee
benefits were up $328,000 from the prior year due to the additional employees
from ASI.  Other operating expenses were down $2.4 million from the same period
in 1996 as a result of the transfer of the bond operation and management
efforts to control costs.


REVENUES

Revenues for the three months ended March 31, 1997 were $22.4 million, a
decrease of $5.5 million, or 19.7%, from 1996's revenue of $27.9 million.  The
details of this decrease are reflected below:

                                        Three Months Ended March 31,
                                        ----------------------------
                                         1997               1996
                                        ------             ------
(In Thousands)                                     
Risk management fees & commissions       5,640              4,598
Net earned premiums                     14,791             21,266
Net investment income                    1,947              2,002
Miscellaneous income                         -                  5
                                        ------             ------
                                        22,378             27,871


Risk Management Fees and Commissions

The Company's risk management fees and commission income generated from its
managed program operations and retail agency consist of the following:

                                    Three Months Ended March 31,
                                    -----------------------------
                                         1997               1996
                                        ------             ------
(In Thousands)                                     
Commissions                              1,458              1,920
Management fees                          1,761              1,428
Claims fees                              1,901                679
Loss control fees                          371                341
Reinsurance placement                      141                213
Miscellaneous fees & charges                 8                 17
                                       -------            -------
                                         5,640              4,598





                                       7



<PAGE>   8



Net fees and commission income increased by $1.0 million or, 22.7%, to $5.6
million for the three month period ended March 31, 1997 from $4.6 million for
the same period in 1996.  Claims fees increased $1.2 million to $1.9 million
for the three month period ended March 31, 1997, from $679,000 for the same
period in 1996, which explains the entire $1.0 million growth in risk
management fees and commissions.  This is a result of the additional revenue
generated from the ASI acquisition.  The $333,000 increase in management fees
was entirely offset by the $462,000 decrease in the retail insurance agency's
sales commissions. Management fees were up over 1996 due to revenues from one
new program and increases in two existing programs.

Insurance Premiums

The Company's gross premiums written increased $1.8 million, or 5.6%, to $33.0
million for the three months ended March 31, 1997 from $31.2 million for the
same period in 1996, due to growth in new and existing programs, offset
partially by the effects of changes in residual market assessments and Company
discontinued programs.  Existing business grew by $4.7 million, or 22.2%, and
new business generated $686,000 in additional premium.  The growth in existing
business was primarily the result of two 1996 programs growing by $3.8 million
in total, and $768,000 of the increase was due to the expansion of one program
into other states.   In addition, approximately $1.8 million of
retrospectively-rated adjustments resulted in increased premiums this quarter.
Partially offsetting the above items was a $1.0 million reduction in the dollar
amount assessed for Workers' Compensation involuntary pools in which the
Company's insurance subsidiaries participate. This resulted from the shrinking
size of the Workers' Compensation involuntary pools.  In addition, during 1996
the Company decided to decrease its writings in historically unprofitable
programs which accounted for a $4.4 million decline in written premiums this
quarter.

Net premiums written decreased by $4.4 million, or 19.5%, to $18.3 million for
the three months ended March 31, 1997 from $22.7 million for the same period in
1996.  On a pro forma basis, as if the reinsurance of the bond business had
occurred at the beginning of 1996, net written premiums increased $1.1 million
or, 6.3%.  Existing business grew by $813,000, or 5.4%, and new business
generated $644,000 in additional premium.  The decreases in discontinued
programs and the residual markets were offset by the increase in
retrospectively-rated programs, as mentioned in the paragraph above.

Net premiums earned decreased by $6.5 million, or 30.4%, to $14.8 million for
the three months ended March 31, 1997 from $21.3 million for the same period in
1996.  On a pro forma basis, net earned premiums decreased by $1.3 million, or
8.1%, from 1996.  The decrease in earned premium corresponds to the decline in
residual market assessments and consciously discontinued programs, as explained
above.  The effect of the growth in new and existing program writings will not
be seen until the premiums begin to earn over the life of the policies.

Net Investment Income

Net investment income decreased by $55,000, or 2.7%, to $1.9 million for the
three months ended March 31, 1997 from $2.0 million for the same period in
1996. This was the result of cash outflows from the Connecticut Surety
reinsurance transaction and the acquisition of ASI.  In addition, a change in
the amortization method used to reflect purchase discounts and premiums on the
bond portfolio reduced investment income by $135,000 for the quarter.  The
pre-tax weighted average yield on invested assets was 5.3% for 1997 and 5.2%
for 1996.  The Company's investment philosophy is one of maximizing after-tax
earnings through significant investments in tax-exempt bonds.  Accordingly, the
weighted average yield on invested assets on an after-tax basis was 4.8%, which
is a slight increase from the same period in the prior year of 4.6%.




                                       8



<PAGE>   9




EXPENSES

Total expenses decreased $5.9 million, or 24.1%, to $18.5 million at March 31,
1997 from $24.3 million for the same period in 1996.

                                               Three Months Ended March 31,
                                               ----------------------------

(In Thousands)                                     1997        1996
                                                 -------      -------
Losses and loss adjustment expenses incurred       7,879       11,709
Salaries & employee benefits                       6,254        5,926
Other operating expenses                           4,319        6,701
Interest on notes payable                             10        -
                                                 -------      -------
                                                  18,462       24,336

Losses and Loss Adjustment Expenses (LAE) Incurred

Losses and LAE incurred decreased by $3.8 million, or 32.7%, to $7.9 million
for the three months ended March 31, 1997 from $11.7 million for the same
period in 1996.  One reason for the decline in losses and LAE incurred was the
reduction in residual market assessments, due to the shrinking size of the
involuntary pools, which caused $910,000 of the decrease.  The majority of the
decline, $2.2 million, was the result of bonds and other discontinued programs,
primarily from the reinsurance arrangement with Connecticut Surety.  The
remaining $681,000 related to favorable results on existing programs.  The loss
and LAE ratio for the current period was 57.8% as compared to 58.1% for the
same period in 1996.  On a pro forma basis, as if the Connecticut Surety
reinsurance ceding arrangement on the bond business had occurred at the
beginning of 1996, the loss and LAE ratio would have been 64.8% in 1996.

Salaries and Employee Benefits

Salaries and employee benefits increased by $328,000, or 5.5%, to $6.3 million
for the three months ended March 31, 1997 compared to $5.9 million for the same
period in 1996.  Salaries and employee benefits for 1997 includes three months
of expense for 55 employees of the recently acquired ASI; this increase is
offset partially by the reduction in bond department salaries due to the
Connecticut Surety arrangement.  The average salaries and wages per person
remained relatively consistent for the first three months of 1997 compared to
the same period in 1996.

Other Operating Expenses

Other operating expenses decreased $2.4 million, or 35.6%, to $4.3 million for
the three months ended March 31, 1997 from $6.7 million for the same period in
1996.  On a pro forma basis, as if the reinsurance of the bond business had
occurred at the beginning of 1996, expenses decreased $355,000, or 7.6%, in 1997
verses 1996.  (The fee income generated from the Connecticut Surety arrangement
is recorded as a reduction to net expenses.)  Analyzing expenses utilizing GAAP
insurance ratios, the expense ratio decreased nine points on an actual basis
and slightly over one point on a comparable pro forma basis.  The $355,000 or
one point decrease is a result of the Company's cost cutting efforts and the
close monitoring thereof.

Interest Expense

Interest expense of $10,000 was recorded for the three months ended March 31,
1997, related to draws on the Company's line of credit.  There was no interest
expense recorded for the three months ended March 31, 1996, as there was no
debt outstanding during 1996.


                                       9



<PAGE>   10


Federal Income Taxes

The provision for income taxes was $943,000 for the three months ended March
31, 1997, and $762,000 for the same period in 1996, representing effective tax
rates of 24.1% and 21.6%, respectively.  These tax rates were significantly
lower than the 34% corporate rate due to the Company's heavily tax-exempt
investment portfolio.  This increase in the Company's effective tax rate was
primarily due to the growth in underwriting income before tax over 1996.


LIQUIDITY AND CAPITAL RESOURCES

The principal sources of funds for the Company are insurance premiums,
investment income, proceeds from the maturity and sale of invested assets, risk
management fees and agency commissions.   Funds are primarily used for the
payment of claims, commissions, salaries and employee benefits, and other
operating expenses.  In  addition, the Company has a high volume of
intercompany transactions due to the insurance operations paying management
fees to the risk management operations.  Such fees are subject to regulatory
approval by state insurance departments and are eliminated in consolidation

Cash flow from operations for the three months ended March 31, 1997 was
negative $6.0 million as compared to $7.0 million for the same period in 1996.
The negative cash flow for 1997 is the result of the Connecticut Surety
transaction, combined with the run-off of discontinued programs.  The Company
does expect to have positive cash flow for the balance of 1997.  At March 31,
1997, the Company held $9.7 million in cash and cash equivalents.

The Company has one unsecured line of credit totaling $15.0 million, of which
$1.0 million was outstanding at March 31, 1997.  The line expires on January 1,
2000.  The Company drew on this line of credit to meet cash flow needs,
primarily to consummate the acquisition of ASI.  The Company had no debt
outstanding during 1996.


SUBSEQUENT EVENT

On April 30th, 1997, the Company entered into an agreement to acquire for cash
all of the outstanding stock of Crest Financial Corporation, a California-based
insurance organization.  This transaction should be completed in the second
quarter, upon receipt of regulatory approvals, and will be accounted for as a
purchase.


                                       10



<PAGE>   11



                                    PART II



ITEM 6.  EXHIBITS AND REPORTS ON FORM 8K

(A)    The following documents are filed as part of this Report:

Exhibit              
  No.                        Description
-------                      -----------
            
  11                 Statement re computation of per share earnings
  27                 Financial Data Schedule


(B)    Reports on Form 8-K

No reports on Form 8-K were filed by the Registrant during the quarter ended
March 31, 1997.



                                       11



<PAGE>   12



                                   SIGNATURES




Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                   MEADOWBROOK INSURANCE GROUP, INC.



                                   By:/s/  Daniel G. Gibson
                                         -------------------------
                                           Chief Financial Officer



Dated:  May 14, 1997



                                       12


<PAGE>   13

                                EXHIBIT INDEX


Exhibit
  No.                        Description
-------                      -----------

  11         Statement re computation of per share earnings
  27         Financial Data Schedule