UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K
(Mark  One)

[  X  ]   ANNUAL  REPORT  PURSUANT  TO  SECTION  13 OR 15(D) OF THE SECURITIES
          EXCHANGE  ACT  OF  1934

FOR  THE  FISCAL  YEAR  ENDED  DECEMBER  31,  2002.
                               -------------------

                                       OR

[   ]     TRANSITION  REPORT  PURSUANT  TO  SECTION 13 OR 15(D) OF THESECURITIES
          EXCHANGE  ACT  OF  1934

FOR  THE  TRANSITION  PERIOD  FROM  ____________  TO  ____________.

                        COMMISSION FILE NUMBER:000-24366
                                               ---------

                               GORAN CAPITAL INC.
                               ------------------
             (Exact name of registrant as specified in its charter)

CANADA                                                           Not  Applicable
------                                                           ---------------
State  or  other  Jurisdiction  of            IRS  Employer  Identification  No.
Incorporation  or  Organization

2  Eva  Road,  Suite  200,  Etobicoke,  Ontario  Canada                 M9C  2A8
-------------------------------------------------------                 --------
Address  of  Principal  Executive  Offices                             Zip  Code

Registrant's  telephone  number,  including  area code:
                                (416) 622-0660 - Canada, (317)  259-6300  -  USA
                                 -----------------------------------------------

Securities  registered  pursuant  to  Section  12(b)  of  the  Act:

     Title  of  each  class     Name  of  each  exchange  on  which  registered
common  stock     OTC  Bulletin  Board,  Toronto  Stock  Exchange
-------------     -----------------------------------------------

Securities  registered  pursuant  to  Section  12(g)  of  the  Act:
            None
     -----------
(Title  of  class)
__________________
(Title  of  class)

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
                                            ---

Indicate  by  check mark if disclosure of delinquent filers pursuant to Item 405
of  Regulation  S-K  (Sec. 229.405 of this chapter) is not contained herein, and
will  not  be  contained,  to  the best of registrant's knowledge, in definitive
proxy  or  information  statements incorporated by reference in Part III of this
Form  10-K  or  any  amendment  to  this  Form  10-K.  [   ]

Indicate  by  check  mark  whether  the  Registrant  is an accelerated filer (as
defined  in  Rule  12b-2  of  the  Act).
Yes  No  X
       ---

The  aggregate  market  value of the 2,333,854 shares of the Registrant's common
stock  held  by  non-affiliates,  as  of  June  6,  2003  was  $840,187.

The  number of shares of Registrant's no par common stock outstanding as of June
6,  2003  was  5,393,698.


                       DOCUMENTS INCORPORATED BY REFERENCE

Portions  of  the  Registrant's Annual Report to Shareholders for the year ended
December  31,  2002  are  incorporated  by  reference in Parts II and IV hereof.


                            EXCHANGE RATE INFORMATION

The  Company's accounts and financial statements are maintained in U.S. Dollars.
In  this  Report  all  dollar amounts are expressed in U.S. Dollars except where
otherwise  indicated.

The following table sets forth, for each period indicated, the average rates for
U.S.  Dollars expressed in Canadian Dollars during such period, the high and the
low  exchange  rate  during that period and the exchange rate at the end of such
period,  based upon the noon buying rate in New York City for cable transfers in
foreign  currencies,  as  certified  for customs purposes by the Federal Reserve
Bank  of  New  York  (the  "Noon  Buying  Rate"):


                             For The Years Ended December 31,
                       2002     2001      2000      1999       1998
                       ----     ----      ----      ----       ----
            Average   .6370     .6446     .6733     .6724     .6745
          Period End  .6329     .6279     .6672     .6929     .6532
             High     .6583     .6669     .6965     .6929     .7061
              Low     .6231     .6279     .6416     .6625     .6376


                              ACCOUNTING PRINCIPLES

The  financial  information contained in this document is stated in U.S. Dollars
and  is  expressed  in  accordance  with  Canadian Generally Accepted Accounting
Principles  unless  otherwise  stated.


<TABLE>
<CAPTION>


Table of Contents
<S>                     <C>                                                                      <C>
ITEM . . . . . . . . .  PAGE
                                     PART I

Item 1.. . . . . . . .  Business                                                                  4

Item 2.. . . . . . . .  Properties                                                               19

Item 3.. . . . . . . .  Legal Proceedings                                                        20

Item 4.. . . . . . . .  Submission of Matters to a Vote of Security Holders                      21

                                    PART II

Item 5.. . . . . . . .  Market for Registrant's Common Equity and Related Shareholder Matters    21

Item 6.. . . . . . . .  Selected Consolidated Financial Data                                     22

Item 7.. . . . . . . .  Management's Discussion and Analysis of Financial Condition and
                        Results  of Operations                                                   22

Item 7A. . . . . . . .  Quantitative and Qualitative Disclosures About Market Risk               22

Item 8.. . . . . . . .  Financial Statements and Supplementary Data                              22

Item 9.. . . . . . . .  Changes in and Disagreements with Accountants on Accounting
                        And  Financial Disclosure                                                22

                                    PART III

Item 10. . . . . . . .  Directors and Executive Officers of the Registrant                       22

Item 11. . . . . . . .  Executive Compensation                                                   23

Item 12. . . . . . . .  Security Ownership of Certain Beneficial Owners and Management           28

Item 13. . . . . . . .  Certain Relationships and Related Transactions                           28

                                    PART IV

Item 14. . . . . . . .  Controls and Procedures                                                  30

Item 15                 Exhibits, Financial Statement Schedules, and Reports on Form 8-K         31

                        Signatures                                                               38
</TABLE>


<PAGE>
                                     PART I

ITEM  1  -  BUSINESS

FORWARD-LOOKING  STATEMENT
All  statements, trend analyses, and other information herein contained relative
to  markets  for  the  Company's  products  and/or  the  Company's operations or
financial  results  constitute  forward-looking statements within the meaning of
the  Private Securities Litigation Reform Act of 1995 (the Act). Forward-looking
statements  include statements which are predictive in nature, which depend upon
or  refer to future events or conditions, which include words such "anticipate,"
"could,"  "feel(s),"  "believes,"  "plan,"  "estimate,"  "expect,"  "should,"
"intend,"  "will,"  and other similar expressions .  In addition, any statements
concerning  future  financial  performance,  ongoing  business  strategies  or
prospects  and  possible  future  Company  actions  which  may  be  provided  by
management  are  also  forward-looking  statements  as  defined  by  the  Act.
Forward-looking  statements  are  based  on current expectations and projections
about  future  events  and are subject to known and unknown risks, uncertainties
and other factors which may cause actual results to be materially different from
those  contemplated by the forward-looking statements. Such factors include, but
are  not  limited to,  the effect on customers, agents, employees and others due
to SIG's and certain of its subsidiaries' receipt of going concern opinions from
their  accountants;  general  economic conditions, including prevailing interest
rate  levels  and  stock  market  performance;  factors  affecting the Company's
nonstandard  automobile  operations  such  as  rate  increase  approval,  policy
renewals, new business written, and premium volume; and the factors described in
this  section and elsewhere in this report. These forward-looking statements are
not  guaranties  of future performance and the Company has no specific intention
to  update  these  statements.

OVERVIEW  OF  BUSINESS
Goran  Capital  Inc.  ("Goran"  or  the  "Company")  is  a  Canadian  federally
incorporated holding company principally engaged in the business of underwriting
property and casualty insurance through its NONSTANDARD AUTO GROUP Pafco General
Insurance  Company  ("Pafco") and Superior Insurance Company ("Superior"), which
maintain  their headquarters in Indianapolis, Indiana.  Goran owns approximately
73.8%  of a U.S. holding company, Symons International Group, Inc. ("SIG").  SIG
owns  IGF  Holdings, Inc. ("IGFH") and Superior Insurance Group Management, Inc.
("Superior  Management")  which  are  the  holding  companies  for the insurance
subsidiaries.   Superior  Management  owns  Superior  Insurance  Group,  Inc.
("Superior  Group")  which  is  the  management  company  for  the  insurance
subsidiaries.  SIG's  revenue  represents  approximately  90%  of  Goran's
consolidated  revenues.  Goran's  other  subsidiaries  are  Granite  Reinsurance
Company  Ltd.  ("Granite Re"), Granite Insurance Company ("Granite"), and Symons
International  Group  (Florida)  Inc.  ("SIGF").

Granite  Re is a specialized reinsurance company that underwrites niche products
such  as  nonstandard automobile, crop, property casualty reinsurance and offers
(on  a  non-risk  bearing,  fee basis), rent-a-captive facilities for Bermudian,
Canadian  and  U.S.  reinsurance  companies.  Through  a rent-a-captive program,
Granite  Re  offers  the  use  of its capital and its underwriting facilities to
write  specific  programs  on  behalf of its clients, including certain programs
ceded  from  IGF  and  Pafco.  Granite  Re  alleviates the need for a clients to
establish its own insurance company and also offers this facility in an offshore
environment.

Granite,  a  Canadian  federally  licensed  insurance  company, sold its book of
business  in  January  1990  to  an  affiliate  which subsequently sold to third
parties in June 1990.  Granite currently has one outstanding claim and maintains
an  investment  portfolio  sufficient  to  support  this claim liability.  Goran
anticipates  that  the  outstanding  claim  will  be  resolved  by  2004.

SIGF,  a  Florida  corporation,  is  primarily  engaged  in  the  operation of a
property/casualty  insurance  brokerage  and  a  flood  insurance  brokerage.

As  previously  announced, IGF Insurance Company ("IGF") sold its crop insurance
operations to Acceptance Insurance Companies Inc. ("Acceptance") on June 6, 2001
and  is  now  in runoff.  Accordingly, the financial statements included in this
report  reflect  the  results  of  the  crop  insurance segment as "discontinued
operations."

NONSTANDARD  AUTOMOBILE  INSURANCE

Overview
The  Company's  nonstandard automobile insurance operations are conducted by SIG
and  its  subsidiaries  (the  "Nonstandard  Auto  Group").  Specifically, Pafco,
Superior, Superior Guaranty Insurance Company ("Superior Guaranty") and Superior
American  Insurance  Company ("Superior American") are engaged in the writing of
insurance  coverage  for  automobile  physical  damage  and  liability policies.
Nonstandard  insureds  are  those individuals who are unable to obtain insurance
coverage  through  standard  market carriers due to factors such as poor premium
payment  history, poor driving experience, and type of vehicle.  The Nonstandard
Auto Group offer several different policies, which are directed toward different
classes  of  risk  within the nonstandard market.  Premium rates for nonstandard
risks  are higher than for standard risks.  Since it can be viewed as a residual
market,  the  size  of  the  nonstandard  private passenger automobile insurance
market  changes  with the insurance environment and grows when standard coverage
becomes  more  restrictive.  Nonstandard  policies  have relatively short policy
periods  and  low  limits  of  liability. Also, since the nonstandard automobile
insurance business typically experiences a lower rate of retention than standard
automobile  insurance,  the  number  of  new  policyholders  underwritten  by
nonstandard  automobile  insurance  carriers  each year is substantially greater
than  the  number  of  new  policyholders  underwritten  by  standard  carriers.

Products
The Nonstandard Auto Group offers both liability and physical damage coverage in
the  insurance  marketplace,  with  policies  having  terms from three to twelve
months.  Most  nonstandard  automobile  insurance policyholders choose the basic
limits  of  liability  coverage  which,  though  varying  from  state  to state,
generally  is  $25,000  per person and $50,000 per accident for bodily injury to
others  and  in  the  range  of  $10,000  to $20,000 for damage to cars or other
property.

Where  permitted, Superior offers a tiered product covering the full spectrum of
automobile  insurance  customers  from  nonstandard  to  ultra-preferred.

Marketing
The  Nonstandard  Auto  Group business is concentrated in the states of Florida,
California, Virginia, Georgia, Indiana and Nevada.  SIG's insurance subsidiaries
are  authorized  to  write  nonstandard  automobile  insurance  in 12 additional
states.  States  are  selected  for expansion or withdrawal based on a number of
criteria,  including  the  size  of the nonstandard automobile insurance market,
state-wide  loss  results,  competition, capitalization of its companies and the
regulatory  climate.  The following table sets forth the geographic distribution
of  gross premiums written by the Nonstandard Auto Group for the years indicated
sorted  in  descending  order  of  2002  volume  (in  thousands):
<TABLE>
<CAPTION>

State                     2002      2001      1999
----------------------  --------  --------  --------
<S>                     <C>       <C>       <C>
Florida. . . . . . . .  $ 45,583  $ 49,162  $ 44,070

California . . . . . .    20,891    34,287    32,480

Virginia . . . . . . .    15,661    21,054    20,089

Colorado 1 . . . . . .     7,988    10,112     6,938

Georgia. . . . . . . .     6,565    15,481    13,670

Indiana. . . . . . . .     4,861     6,275    12,804

Nevada . . . . . . . .     1,493     1,980     3,707

Missouri . . . . . . .       698       839     1,929

Tennessee. . . . . . .       676     1,696     9,794

Iowa . . . . . . . . .       504     1,066     2,023

Kentucky . . . . . . .       406     3,135     5,034

Pennsylvania 2 . . . .       288     9,683         -

Oklahoma . . . . . . .       274       635     1,090

Arizona. . . . . . . .       169     1,111     4,484
Other states . . . . .       204     2,972    15,310
                        --------  --------  --------

Total nonstandard auto   106,261   159,488   173,422

Other property . . . .     1,514     1,604     1,039

Reinsurance. . . . . .     3,619    32,094     7,638
                        --------  --------  --------

Total. . . . . . . . .  $111,394  $193,186  $182,099
                        ========  ========  ========
<FN>

1.   During  May  2003,  the  Nonstandard  Auto Group ceased writing business in
     Colorado.
2.   Company  All  premiums  in Pennsylvania were written by IGF, which has been
     precluded  from  writing  other  than  renewal premium after July 30, 2001.
</TABLE>


The  Nonstandard Auto Group markets its nonstandard products exclusively through
independent agencies. The Nonstandard Auto Group has several territory managers,
each  of  whom  resides  in  a  specific  marketing region and has access to the
technology  and  software  necessary  to  provide  marketing,  rating  and
administrative  support  to  the  agencies  in  his  or  her  region.

The  Nonstandard Auto Group attempts to foster strong service relationships with
its  agents  and  customers.  The  Nonstandard  Auto Group has automated certain
marketing,  underwriting  and  administrative  functions and has allowed on-line
communication  with  its agency force.  In addition to delivering prompt service
while  ensuring  consistent  underwriting,  the  Nonstandard Auto Group provides
state  of the art point of sale rating software to agents, which permits them to
rate  risks  in  their offices. All new business applications are electronically
uploaded directly from the agents' offices to the Nonstandard Auto Group through
this  software.  In  most  states,  an  in-house developed point of sale product
allows  agents  to  order motor vehicle, credit and other reports on line at the
time  of  sale.

Most  of  the Nonstandard Auto Group's agents have limited authority to sell and
bind insurance coverages in accordance with procedures established by SIG, which
is  a  common  practice  in  the nonstandard automobile insurance business.  The
Nonstandard  Auto  Group  reviews  all  coverages  bound  by agents promptly and
generally accepts coverages that fall within their stated underwriting criteria.
The  Nonstandard  Auto  Group  has  the  right within a specified time period to
cancel  any  policy even if the risk falls within the underwriting criteria. The
Nonstandard  Auto  Group  compensates  agents  by paying a commission based on a
percentage  of  premiums  produced.

The  Company  believes having four individual U.S. companies licensed in various
states  allows it the flexibility to engage in multi-tiered marketing efforts in
which  specialized  automobile  insurance  products are directed toward specific
segments  of  the  market.  Since certain state insurance laws prohibit a single
insurer  from offering similar products with different commission structures or,
in  some  cases  premium  rates,  it  is  necessary to have multiple licenses in
certain  states  in  order  to  obtain  the  benefits  of  market  segmentation.

Underwriting
The Nonstandard Auto Group utilizes many factors in determining its rates.  Some
of the characteristics used are type, age and location of the vehicle, number of
vehicles  per policyholder, number and type of convictions and accidents, limits
of  liability,  deductibles,  and,  where  allowed  by law, credit, age, sex and
marital  status  of the insured.  The rate approval process varies from state to
state. Some states allow filing and immediate use of rates, while others require
approval  by  the  state's  insurance  department prior to the use of the rates.

Underwriting  results  of  insurance  companies are frequently measured by their
combined  ratios.  However,  investment  income,  federal income taxes and other
non-underwriting income or expense are not reflected in the combined ratio.  The
profitability  of  property  and  casualty insurance companies depends on income
from  underwriting, investment and service operations.  Underwriting results are
generally  considered  profitable  when  the  combined  ratio  is under 100% and
unprofitable when the combined ratio is over 100%.  See "Management's Discussion
and  Analysis  of  Financial  Condition  and  Results of Operations" for further
discussion  on  the  combined  ratio.

In  an  effort  to  maintain  and  improve  underwriting  profits, the territory
managers  monitor  loss  ratios  of  the  agencies  in  their  regions  and meet
periodically  with  the  agents  in  order to address any adverse trends in loss
ratios  or  other  profitability  indicators.

Claims
The  Nonstandard  Auto  Group claims department handles claims on a regional and
local basis from claim offices in Indianapolis, Indiana; Atlanta, Georgia; Tampa
and  West  Palm  Beach,  Florida;  and Anaheim, California. The Nonstandard Auto
Group  uses  a combination of their own adjusters and independent appraisers and
adjusters  for  estimating  physical  damage  claims  and  limited  elements  of
investigation.

Reinsurance
The  Company  follows the customary industry practice of reinsuring a portion of
its  risks.  Insurance  is ceded principally to reduce the Company's exposure on
large individual risks and to provide protection against large losses, including
catastrophic losses.  Although reinsurance does not legally discharge the ceding
insurer  from  its  primary obligation to pay the full amount of losses incurred
under  policies reinsured, it does render the reinsurer liable to the insurer to
the  extent  provided  by  the  terms of the reinsurance treaty.  As part of the
Company's  internal  procedures,  the  financial  condition  of each prospective
reinsurer  is  evaluated before business is ceded to that carrier.  Based on the
Company's  review  of  its  reinsurers'  financial  health and reputation in the
insurance marketplace, the Company believes its reinsurers are financially sound
and  that  they  can  meet  their  obligations under the terms of the respective
reinsurance  treaties.

In  2002,  Pafco  and Superior maintained casualty excess of loss reinsurance on
their  nonstandard  automobile  insurance business covering 35.0% of $700,000 of
losses  on  an individual occurrence basis in excess of $300,000 up to a maximum
of  $3,000,000  at  100.0%.

As  of  December  31,  2002,  amounts  recoverable  from  reinsurers relating to
<TABLE>
<CAPTION>
                                                                 Reinsurance
                                                              Recoverables as of
Reinsurer                                 A.M. Best Rating   December 31, 2002(1)
---------------------------------------  ------------------  ---------------------
<S>                                      <C>                 <C>
National Union Fire Insurance Company
 of Pittsburgh, PA. . . . . . . . . . .         A++          $              42,688
Gerling Global Reinsurance Corporation
 of America . . . . . . . . . . . . . .         B+                           1,197
Lloyds of London (Various Syndicates) .      Not Rated                       1,272
Transatlantic Reinsurance Company . . .         A++                          1,131
<FN>

(1)  Only  recoverables  greater  than  $200,000  are  shown.  Total nonstandard
     automobile  reinsurance  recoverables  as  of  December  31,  2002  were
     approximately  $47,044,000.
(2)  An  A.M.  Best  Rating  of "A++" is the highest of 15 ratings. An A.M. Best
     Rating  of  "B+"  is  the  sixth  highest  of  15  ratings.
</TABLE>
nonstandard  automobile  operations  follows  (in  thousands):

Effective  January  1, 2000, Pafco and Superior entered into an automobile quota
share  agreement  with  National Union Fire Insurance Company of Pittsburgh, PA.
The  amount  of  cession  for  Pafco  is  variable up to a maximum of 60% or $10
million  and  for Superior is variable up to a maximum of 75% or $60 million for
all  new  and  renewal business.  In 2002, Pafco and Superior ceded 71% of their
nonstandard  automobile  gross  written  premiums  under  this  treaty.

On  April  29,  1996,  Pafco  also  entered  into a 100% quota share reinsurance
agreement  with  Granite  Re  (no  A.M.  Best  rating),  whereby  all of Pafco's
commercial  business  from  1996  and  thereafter was ceded effective January 1,
1996.  This  agreement  was  in  effect  during  2002.

Neither  Pafco  nor Superior has any facultative reinsurance with respect to its
nonstandard  automobile  insurance  business.

Competition
The  Nonstandard  Auto  Group  competes  with  both  large  national and smaller
regional companies in each state in which it operates. These competitors include
companies  that  serve  the  agency  market  and  companies  that sell insurance
directly  to  consumers.  Direct writers may have certain competitive advantages
over  agency writers, including increased name recognition, increased loyalty of
their  customer  base  and,  potentially,  reduced  acquisition  costs. Specific
primary  competitors  are  Progressive  Casualty Insurance Company and specialty
subsidiaries  of a number of insurance groups, including AIG, Allstate, American
Financial  Group  and  GMAC.  Generally,  these  competitors are larger and have
greater  financial  resources  than  the  Company.

RESERVES  FOR  LOSSES  AND  LOSS  ADJUSTMENT  EXPENSES
Loss reserves are estimates, established at a given point in time based on facts
then  known,  of  what an insurer predicts its exposure to be in connection with
incurred  losses.  Loss adjustment expense ("LAE") reserves are estimates of the
ultimate liability associated with the expense of settling all claims, including
investigation  and  litigation  costs  resulting  from  such claims.  The actual
liability  of  an  insurer  for its losses and LAE reserves at any point in time
will  be  greater  or  less  than  these  estimates.

The  Company  maintains reserves for the eventual payment of losses and LAE with
respect to both reported and unreported claims.  Nonstandard automobile reserves
for  reported  claims  are  established  on a case-by-case basis.  The reserving
process  takes into account the type of claim, policy provisions relating to the
type  of  loss  and  historically  paid  loss  and  LAE  for  similar  claims.

Loss  and  LAE  reserves for claims that have been incurred but not reported are
estimated  based  on  many  variables  including  historical  and  statistical
information, inflation, legal developments, economic conditions, trends in claim
severity  and frequency and other factors that could affect the adequacy of loss
reserves.

The loss reserve development table below illustrates the change over time in the
reserves the Company has established for loss and loss expenses as of the end of
the indicated calendar years for the Nonstandard Auto Group.  The table includes
the  loss  reserves  acquired  from  the acquisition of Superior in 1996 and the
related  loss  reserve  development  thereafter.  The  first  section  shows the
reserves  as  originally  reported  at  the  end  of the stated year. The second
section,  reading  down,  shows  the  cumulative  amounts  paid as of the end of
successive  years  with  respect  to  the  reserve liability. The third section,
reading  down, shows the re-estimates of the original recorded reserve as of the
end  of  each  successive  year  which  is a result of sound insurance reserving
practices of addressing new emerging facts and circumstances which indicate that
a  modification  of the prior estimate is necessary.   The last section compares
the  latest  re-estimated  reserve  to  the  reserve originally established, and
indicates  whether  or  not  the  original reserve was adequate or inadequate to
cover  the  estimated  costs  of  unsettled  claims.

The loss reserve development table is cumulative and, therefore, ending balances
should  not  be added since the amount at the end of each calendar year includes
activity  for  both  the  current  and  prior  years.

The  reserve  for  losses  and loss expenses is an accumulation of the estimated
amounts  necessary to settle all outstanding claims as of the date for which the
reserve  is  stated.  The reserve and payment data shown below have been reduced
for  estimated subrogation and salvage recoveries. The Company does not discount
its reserves for unpaid losses and loss expenses.  No attempt is made to isolate
explicitly the impact of inflation from the multitude of factors influencing the
reserve estimates though inflation is implicitly included in the estimates.  The
Company  regularly  updates  its reserve forecasts by type of claim as new facts
become  known  and  events  occur  which  affect  unsettled  claims.

Since the beginning of 1997, the Company, as part of its efforts to reduce costs
and  combine  the operations of its Nonstandard Auto Group, emphasized a unified
claim  settlement  practice  as  well  as  reserving philosophy for Superior and
Pafco.  Superior  had  historically  provided  strengthened  case reserves and a
level  of  IBNR  that  reflected  the  strength of the case reserves.  Pafco had
historically  carried  relatively  lower case reserves with higher IBNR reserve.
This  change in claims management philosophy since 1997 combined with the growth
in  premium volume produced sufficient volatility in prior year loss patterns to
warrant  the Company to re-estimate its reserve for losses and loss expenses and
record  an  additional  reserve  during  1997,  1998,  and 1999.  The effects of
changes  in settlement patterns, costs, inflation, growth and other factors have
all  been  considered in establishing the current year reserve for unpaid losses
and  loss  expenses.


<TABLE>
<CAPTION>


Symons  International  Group,  Inc.
Nonstandard  Automobile  Insurance  Only
For  The  Years  Ended  December  31,  (in  thousands)

                   1992      1993      1994      1995      1996       1997       1998       1999       2000      2001      2002
                 --------  --------  --------  --------  ---------  ---------  ---------  ---------  --------  ---------  ------
<S>              <C>       <C>       <C>       <C>       <C>        <C>        <C>        <C>        <C>       <C>         <C>

Gross
Reserves for
Unpaid losses
 and LAE. .  .        .   $27,403   $25,248   $71,748   $79,551   $101,185   $121,661   $141,260   $103,441   $79,047   $ 65,915
---------------------------------------------------------------------------------------------------------------------------------
Deduct
 Reinsurance
 Recoverable. .            12,581    10,927     9,921     8,124     16,378      6,515      3,167     18,709    28,511     22,990
---------------------------------------------------------------------------------------------------------------------------------
Reserve for
 Unpaid losses
 and LAE, net
 of
 reinsurance. . $17,055    14,822    14,321    61,827     71,427     84,807    114,829    138,093    84,732     50,536   42,925
-------------------------------------------------------------------------------------------------------------------------------
Paid
 Cumulative as
 of:
One Year
 Later. . . . .   10,868     8,875     7,455    42,183     59,410     62,962     85,389     81,444    57,696     36,291
-------------------------------------------------------------------------------------------------------------------------------
Two Years
 Later. . . . .   15,121    11,114    10,375    53,350     79,319     89,285    111,042    107,534    79,316
-------------------------------------------------------------------------------------------------------------------------------
Three Years
 Later. . . . .   16,855    13,024    12,040    58,993     86,298     98,469    121,907    118,316        --
-------------------------------------------------------------------------------------------------------------------------------
Four Years
 Later. . . . .   17,744    13,886    12,822    61,650     89,166    102,854    127,390         --        --
-------------------------------------------------------------------------------------------------------------------------------
Five Years
 Later. . . . .   18,195    14,229    13,133    62,621     90,477    105,252         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Six Years
 Later. . . . .   18,408    14,330    13,375    63,031     91,345         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Seven Years
 Later. . . . .   18,405    14,426    13,418    63,534         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Eight Years
 Later. . . . .   18,460    14,386    13,648        --         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Nine Years
 Later. . . . .   18,411    14,572        --        --         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Ten Years
 Later. . . . .   18,420        --        --        --         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Liabilities re
-estimated as
 of:
One Year
 Later. . . . .   17,442    14,788    13,365    59,626     82,011     97,905    131,256    124,012    85,538     63,014
-------------------------------------------------------------------------------------------------------------------------------
Two Years
 Later. . . . .   18,103    13,815    12,696    60,600     91,743    104,821    128,302    121,480    93,483
-------------------------------------------------------------------------------------------------------------------------------
Three Years
 Later. . . . .   18,300    14,051    13,080    63,752     91,641    104,551    127,885    126,321        --
-------------------------------------------------------------------------------------------------------------------------------
Four Years
 Later. . . . .   18,313    14,290    13,485    63,249     91,003    105,012    131,087         --        --
-------------------------------------------------------------------------------------------------------------------------------
Five Years
 Later. . . . .   18,419    14,499    13,441    63,233     91,323    106,813         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Six Years
 Later. . . . .   18,533    14,523    13,592    63,373     91,874         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Seven Years
 Later. . . . .   18,484    14,584    13,652    63,781         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Eight Years
 Later. . . . .   18,508    14,574    13,727        --         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Nine Years
 Later. . . . .   18,494    14,615        --        --         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Ten Years
 Later. . . . .   18,457        --        --        --         --         --         --         --        --
-------------------------------------------------------------------------------------------------------------------------------
Net
 Cumulative
 (deficiency)
 or
 redundancy . .   (1,402)      207       594    (1,954)   (20,447)   (22,006)   (16,258)    11,772    (8,751)   (12,478)
-------------------------------------------------------------------------------------------------------------------------------
Expressed as
 a percentage
 of unpaid
 losses and
 LAE. . . . . .    (8.2%)      1.4%      4.1%    (3.2%)    (28.6%)    (25.9%)    (14.2%)       8.5%   (10.3%)    (24.7%)
-------------------------------------------------------------------------------------------------------------------------------
<FN>
Revaluation  of  gross  losses
 And  LAE  as  of  year-end
 2002
--------------------------------------------------------------------------------------------------------------------------------
Cumulative  gross  paid  as  of
Year-end 2002                28,231     26,013   74,573     100,359     124,345   131,724     120,166     97,310     64,923
------------------------------------------------------------------------------------------------------------------------------
Gross  liabilities  Re
estimated  as  of
year-end 2002                28,280     26,101   74,857     100,925     126,303   137,704     130,453     115,537    98,478
-------------------------------------------------------------------------------------------------------------------------------
Gross  cumulative
(deficiency) or
redundancy                    (877)      (853)   (3,109)    (21,374)    (25,118)  (16,043)     10,807    (12,096)   (19,431)
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>


<PAGE>
Activity  in  the  liability  for unpaid loss and LAE for nonstandard automobile
insurance  is  summarized  below  (in  thousands):
<TABLE>
<CAPTION>
                                2002      2001      2000
                               -------  --------  ---------
<S>                               <C>      <C>        <C>
Balance at January 1,          $81,142  $108,117  $152,455
Less Reinsurance Recoverables  30,600    23,252    13,527
                               -------  --------  ---------
Net Balance at January 1,      50,542    84,865    138,928

Incurred related to
Current Year                   35,413    69,667    127,497
Prior Years                    12,775     774     (14,118)
                               -------  --------  ---------
Total Incurred                 48,188    70,441    113,379

Paid Related to
Current Year                   19,211    46,973    85,334
Prior Years                    36,374    57,791    82,108
                               -------  --------  ---------
Total Paid                     55,585   104,764    167,442

Net Balance at December 31,    43,145    50,542    84,865
Plus Reinsurance Balance       24,059    30,600    23,252
                               -------  --------  ---------
Balance at December 31,        $67,204  $81,142   $108,117
                               =======  ========  =========
</TABLE>
Reserve  estimates are regularly adjusted in subsequent reporting periods as new
facts  and  circumstances  emerge  to  indicate that a modification of the prior
estimate is necessary.  The adjustment, referred to as "reserve development," is
inevitable  given  the  complexities of the reserving process and is recorded in
the  statements  of  operations  in  the period when the need for the adjustment
becomes  known.  The  foregoing  reconciliation  indicates  unfavorable  reserve
development  of  $12,775,000  on  the  December  31,  2001  reserves.

The  anticipated  effect  of  inflation is implicitly considered when estimating
losses  and LAE liabilities.  While anticipated price increases due to inflation
are  considered  in  estimating  the ultimate claims costs, increases in average
claim  severities  is  caused  by  a  number  of factors.  Future severities are
projected  based  on  historical  trends  adjusted  for  implemented  changes in
underwriting  standards,  policy  provisions,  claims  management  practices and
procedures  and  general  economic  trends.  Anticipated  severity  trends  are
monitored  relative  to  actual  development  and  are  modified  if  necessary.

Liabilities  for  loss and LAE have been established when sufficient information
has  been  developed to indicate the involvement of a specific insurance policy.
In addition, reserves have been established to cover additional exposure on both
known  and  unasserted  claims.

RATINGS
A.M. Best currently assigns a "B-" rating to Superior and a "C" rating to Pafco.
A.M.  Best's  ratings  are  based  upon  a  comprehensive  review of a company's
financial  performance,  which  is  supplemented  by  certain  data,  including
responses  to  A.M.  Best's questionnaires, phone calls and other correspondence
between A.M. Best analysts and company management, quarterly NAIC filings, state
insurance  department examination reports, loss reserve reports, annual reports,
company business plans and other reports filed with state insurance departments.
A.M.  Best  undertakes  a  quantitative  evaluation,  based  upon profitability,
leverage and liquidity, and a qualitative evaluation, based upon the composition
of  a  company's book of business or spread of risk, the amount, appropriateness
and  soundness of reinsurance, the quality, diversification and estimated market
value  of  its  assets,  the  adequacy  of  its loss reserves and policyholders'
surplus,  the  soundness  of  a  company's  capital  structure,  the extent of a
company's  market  presence and the experience and competence of its management.
A.M.  Best's  ratings  represent an independent opinion of a company's financial
strength  and  ability  to  meet  its obligations to policyholders.  A.M. Best's
ratings  are  not  a  measure  of  protection  afforded investors.  "B-" and "C"
ratings  are  A.M.  Best's  eighth  and eleventh highest rating classifications,
respectively,  out  of  fifteen  ratings.  A  "B-" rating is awarded to insurers
which,  in  A.M.  Best's  opinion,  "have,  on balance, fair financial strength,
operating  performance  and  market  profile  when  compared  to  the  standards
established by the A.M. Best Company" and "have an ability to meet their current
obligations  to  policyholders,  but  their  financial strength is vulnerable to
adverse  changes  in  underwriting  and  economic  conditions."  A "C" rating is
awarded  to  insurers  which,  in  A. M. Best's opinion, "have, on balance, weak
financial  strength,  operating  performance and market profile when compared to
the standards established by the A.M. Best Company" and "have an ability to meet
their current obligations to policyholders, but their financial strength is very
vulnerable  to  adverse  changes  in  underwriting  and  economic  conditions."

A.M.  Best currently assigns an "E" rating (Under Regulatory Supervision) to IGF
reflecting  the  significant  regulatory  constraint  resulting from the Consent
Order  entered  into  between  IGF  and the Indiana Department Of Insurance (see
"Regulatory  Actions").

REGULATION
General
The  Company's  U.S. insurance businesses are subject to comprehensive, detailed
regulation  throughout  the  United  States,  under  statutes  which  delegate
regulatory,  supervisory  and  administrative  powers  to  state  insurance
commissioners.  The  primary  purpose of such regulations and supervision is the
protection  of  policyholders  and  claimants  rather than shareholders or other
investors.  Depending  on whether an insurance company is domiciled in the state
and whether it is an admitted or non-admitted insurer, such authority may extend
to  such  things as (i) periodic reporting of the insurer's financial condition;
(ii)  periodic  financial examination; (iii) approval of rates and policy forms;
(iv) loss reserve adequacy; (v) insurer solvency; (vi) the licensing of insurers
and  their  agents;  (vii)  restrictions  on  the payment of dividends and other
distributions;  (viii)  approval  of  changes  in control; and (ix) the type and
amount  of  permitted  investments.

The  losses, adverse trends and uncertainties discussed in this report have been
and  continue  to  be  matters of concern to the domiciliary and other insurance
regulators  of  the  Company's  U.S.  operating  subsidiaries.  (See "Regulatory
Actions,"  "Risk-Based  Capital  Requirements,"  and  "RISK  FACTORS").

Regulatory  Actions
On  June  6,  2001,  IGF  sold substantially all of its crop insurance assets to
Acceptance.  On June 24, 2001, following the sale of IGF's crop insurance assets
and  as  a result of losses experienced by IGF in its crop insurance operations,
the  IDOI and IGF entered into a consent order (the "Consent Order") relating to
IGF.  IGF has discontinued writing new business and its operations are presently
in  run  off.  The IDOI has continued to monitor the status of IGF.  The Consent
Order  prohibits  IGF  from  taking  any  of the following actions without prior
written  consent  of  the  IDOI:

-    Sell  or  encumber  any  of  its  assets,  property,  or business in force;
-    Disburse  funds,  except to pay direct unaffiliated policyholder claims and
     normal  operating  expenses  in the ordinary course of business (which does
     not  include  payments  to affiliates except for the reimbursement of costs
     for  running IGF by the Company, and does not include payments in excess of
     $10,000);
-    Lend  its  funds  or  make  investments,  except  in  specified  types  of
     investments;
-    Incur  debts  or  obligations, except in the ordinary course of business to
     unaffiliated  parties;
-    Merge  or  consolidate  with  another  company;
-    Enter  into  new,  or  amend  existing,  reinsurance  agreements;
-    Complete,  enter  into  or  amend  any  transaction  or arrangement with an
     affiliate,  and
-    Disburse  funds  or  assets  to  any  affiliate.

The  Consent  Order  also  requires IGF to provide the IDOI with monthly written
updates  and  immediate  notice  of  any material change regarding the status of
litigation  with  Continental  Casualty  Company,  statutory reserves, number of
non-standard automobile insurance policies in-force by state, and reports of all
non-claims  related  disbursements.  IGF's  failure  to  comply with the Consent
Order  could  cause  the  IDOI  to  begin proceedings to have a rehabilitator or
liquidator  appointed  for IGF or to extend the provisions of the Consent Order.

Pafco has been subject to an agreed to order of the IDOI since February 17, 2000
that  requires  Pafco,  among  other  matters,  to:

-    Refrain  from  doing  any of the following without the IDOI's prior written
     consent:

     Selling assets or business in force or transferring property, except in the
     ordinary  course  of  business;
     Disbursing funds, other than for specified purposes or for normal operating
     expenses and in the ordinary course of business (which does not include
     payments to  affiliates,  other  than  under written contracts previously
     approved by the IDOI,  and  does  not  include  payments  in  excess  of
     $10,000);
     Lending  funds;
     Making  investments,  except  in  specified  types  of  investments;
     Incurring  debt,  except  in  the  ordinary  course  of  business  and  to
     unaffiliated  parties;
     Merging  or  consolidating  with  another  company;  or
     Entering  into  new,  or  modifying  existing,  reinsurance  contracts.

-    Reduce  its  monthly  auto premium writings, or obtain additional statutory
     capital or surplus, such that the ratio of gross written premium to surplus
     and  net  written  premium  to  surplus  does  not  exceed  4.0  and  2.4,
     respectively;  and  provide  the  IDOI  with  regular reports demonstrating
     compliance  with  these  monthly  writings  limitations.
-    Continue  to  comply  with  prior  IDOI  agreements  and  orders to correct
     business  practices  under  which  Pafco  must  provide  monthly  financial
     statements  to  the  IDOI,  obtain  prior  IDOI  approval  of  reinsurance
     arrangements  and  affiliated  party transactions, submit business plans to
     the  IDOI  that  address  levels  of  surplus and net premiums written, and
     consult  with  the  IDOI  on  a  monthly  basis.

Pafco's  inability  or  failure to comply with any of the above conditions could
result  in  the  IDOI  requiring further reductions in Pafco's permitted premium
writings  or  in  the  IDOI  instituting  future  proceedings  against  Pafco.
Restrictions on premium writings result in lower premium volume. Management fees
payable  to  Superior Group are based on gross written premium; therefore, lower
premium  volume  results  in  reduced  management fees paid by Pafco to Superior
Group.

In March 2000, Pafco agreed with the Iowa Department of Insurance ("IADOI") that
it  will  not  write  any  new non-standard business in Iowa, until such time as
Pafco has reduced its overall non-standard automobile policy counts in the state
or:

-    Has  increased  surplus;  or
-    Has  achieved  a net written premium to surplus ratio of less than three to
     one;  or
-    Has  surplus  reasonable  to  its  risk.

Pafco has continued to service existing policyholders and renew policies in Iowa
and  provide  policy  count  information  on a monthly basis in conformance with
IADOI  requirements.

Superior  and  Pafco provide monthly financial information to the departments of
insurance in certain states in which they write business at the states' request.

On  July  7, 2000, the FDOI issued a notice of its intent to issue an order (the
"Notice") which principally addressed certain policy and finance fee payments by
Superior  to  Superior  Group.  A  formal  administrative  hearing to review the
Notice  and  a  determination  that  the order contemplated by the Notice not be
issued  was  held  in  February  2001.  The  administrative  law judge entered a
recommended  order on June 1, 2001 that was acceptable to the Company. On August
30,  2001,  the  FDOI  rejected the recommended order and issued its final order
which the Company believes improperly characterized billing and policy fees paid
by  Superior to Superior Group.  On September 28, 2001, Superior filed an appeal
of  the  final  order to the Florida District Court of Appeal. On March 4, 2002,
the FDOI filed a petition in the Circuit Court of the Second Judicial Circuit in
and  for  Leon  County,  Florida  seeking  court enforcement of the FDOI's final
order. Superior filed a motion with the FDOI for stay of the FDOI's final order.
Superior  also  filed a motion for stay with the District Court of Appeal, which
was  denied pending a ruling from the FDOI.  On April 5, 2002 the FDOI granted a
stay  of  the final order that was conditional upon the cessation of the payment
of  billing  fees by Superior to Superior Group and the posting of a $15 million
appeal  bond.  Superior  did  not  agree to the conditions imposed by the FDOI's
conditional  stay.  On  May  6,  2002  Superior filed a motion with the District
Court  of Appeal seeking a stay of the final order pending Superior's appeal or,
in  the  alternative,  a consolidation of the FDOI's enforcement action with the
pending appeal.  On June 19, 2002, the District Court of Appeal entered an order
which  struck the FDOI's conditional requirement for the stay that Superior post
a  $15  million  appeal  bond.  However,  the order denied Superior's request to
consolidate  the appeal with the enforcement action.  On September 26, 2002, the
District  Court  of Appeal affirmed the final order of the FDOI.  On October 31,
2002  the  Circuit Court entered a final order which granted the FDOI's petition
for  enforcement of the FDOI's final order and which requires Superior to comply
with  the  FDOI  final  order.

In  accordance  with  the FDOI's final order, Superior ceased payment of finance
and service fees as of October 1, 2002 and has requested repayment from Superior
Group of $15 million of finance and service fees paid from 1997 through 1999 and
additional finance and service fees paid thereafter in the approximate amount of
$20  million.  Without the payment of finance and service fee income to Superior
Group or an amendment to the management agreement or reallocation of operational
responsibilities,  Superior  Group could not operate profitably. Accordingly, on
October  1,  2002,  Superior  Group discontinued the provision of certain claims
services to Superior.  Superior provided a number of proposals to the FDOI in an
effort  to  establish  an acceptable repayment plan in accordance with the final
order.  None  of  the  proposals  were  acceptable  to  the  FDOI.

On  March  21,  2003  the  FDOI  filed  a  Motion for Enforcement of Final Order
Granting  Petition  to Enforce Agency Action in the Circuit Court which seeks to
hold  Superior  in  contempt  for  failing  to obtain the immediate repayment of
approximately $15 million from Superior Group. Superior Group presently does not
have  the  ability  to  make a $15 million repayment, and Superior believes that
this  petition  seeks  to  fashion  a remedy not intended by the Circuit Court's
November 1, 2002 order and contravenes the spirit of numerous discussion between
the  FDOI  and  Superior to resolve the issues during the pendency of Superior's
appeal  to  the  District  Court  of Appeal and the original enforcement action.
Superior  intends  to  vigorously  defend the recent action brought by the FDOI.

On  September  10,  2002,  the FDOI filed a petition in the Circuit Court of the
Second  Judicial  Circuit  in  and for Leon County, Florida for an order to show
cause  and  notice  of automatic stay which sought the appointment of a receiver
for  the  purpose  of rehabilitation of Superior.  The court entered an order to
show  cause,  temporary injunction and notice of automatic stay on September 13,
2002 and a hearing was held on October 24, 2002.  On November 1, 2002, the court
entered  an order that denied the FDOI's petition for appointment of a receiver.
On  November 8, 2002, the FDOI filed a motion for rehearing, which was denied on
December  17,  2002.

On  November  20,  2002,  the FDOI issued a notice and order to show cause which
seeks to suspend or revoke Superior's certificate of authority principally based
upon  allegations  that  Superior did not comply with the FDOI's August 30, 2001
final order during the pendency of the appeal of the order to the District Court
of  Appeal.  Superior  believes  that  it has fully and timely complied with the
final order and that the action brought by the FDOI is barred by res judicata. A
formal  administrative hearing to review the notice and a determination that the
order or administrative action contemplated by the notice not be issued was held
in  May  2003.  The  administrative  law  judge has not yet issued a recommended
order,  which  the  FDOI  may  accept  or  reject.

On  March  21,  2003,  the  FDOI  filed  a Motion for Enforcement of Final Order
Granting  Petition  to  Enforce Agency Action in the Circuit Court of the Second
Judicial Circuit in and for Leon County, Florida which seeks to hold Superior in
contempt  for  failure to comply with the FDOI's final order during the pendency
of  Superior's  appeal to the Florida District Court of Appeal. On May 7, 2003 a
hearing  was  held  on  the Motion for Enforcement and an order has not yet been
issued.

On  October  9,  2001,  the  State Corporation Commission of Virginia ("Virginia
Commission")  issued  an  order  to  take  notice  regarding an order suspending
Superior's  license  to write business in that state.  An administrative hearing
for  a  determination  that the suspension order not be issued was held March 5,
2002.  On  May  3,  2002, the hearing examiner issued his report and recommended
that  Superior's  license not be suspended and that Superior file its risk based
capital  plans and monthly and quarterly financial information with the Virginia
Bureau  of  Insurance  ("Bureau").  On  June  19,  2002  the Virginia Commission
entered  an  order which adopted the findings of the hearing examiner, continued
the  matter  until  such time as the Bureau requests further action and requires
the  continued  monitoring of the financial condition of Superior by the Bureau.
On  October  11,  2002,  the Virginia Commission filed an administrative Rule to
Show  Cause.  A hearing was scheduled for November 18, 2002 to determine whether
Superior's  license  to  transact  insurance  business  in  Virginia  should  be
suspended.  Because  of  Superior's  improved  financial condition, the Virginia
Commission  continued  the  hearing  indefinitely.  The  nonstandard  automobile
insurance  policies  written in Virginia by Superior accounted for approximately
13.1%  and 14.5% of the total gross written premiums of SIG in 2001 and in 2002,
respectively.

Insurance  Holding  Company  Regulation
The  Company  also  is  subject to laws governing insurance holding companies in
Florida  and  Indiana,  the  domiciliary  states  of  its  insurance  company
subsidiaries.  These  laws, among other things, (i) require SIG to file periodic
information  with  state regulatory authorities including information concerning
its  capital  structure,  ownership,  financial  condition  and general business
operations;  (ii)  regulate certain transactions between SIG, its affiliates and
IGF,  Pafco,  Superior,  Superior American and Superior Guaranty (the Insurers),
including  the  amount  of  dividends  and  other distributions and the terms of
surplus  notes;  and  (iii)  restrict  the  ability of any one person to acquire
certain  levels  of  SIG's  voting securities without prior regulatory approval.

Any  purchaser  of  10% or more of the outstanding shares of common stock of SIG
would  be  presumed to have acquired control of Pafco and IGF unless the Indiana
Commissioner  of  Insurance  ("Indiana  Commissioner")  upon  application,  has
determined  otherwise.  In  addition,  any  purchaser  of  5%  or  more  of  the
outstanding  shares  of  common  stock  of SIG will be presumed to have acquired
control  of  Superior  unless  the  Florida  Commissioner of Insurance ("Florida
Commissioner"),  upon  application,  has  determined  otherwise.

Dividend  payments  by  the Company's U.S. insurance subsidiaries are subject to
restrictions  and  limitations  under  applicable  law,  and under those laws an
insurance  subsidiary may not pay dividends without prior notice to, or approval
by, the subsidiary's domiciliary insurance regulator.  As a result of regulatory
actions  taken by the IDOI with respect to Pafco and IGF, those subsidiaries may
not  pay  dividends without prior approval by the IDOI (see "Regulatory Actions"
above).  Further,  payment  of  dividends  may  be  constrained  by business and
regulatory considerations, and state insurance laws and regulations require that
the  statutory  surplus  of  an  insurance  company  following  any  dividend or
distribution  by  such  company  be  reasonable  in  relation to its outstanding
liabilities  and adequate for its financial needs.  Accordingly, there can be no
assurance  that  the  IDOI  or  the  FDOI would permit any of the Company's U.S.
insurance subsidiaries to pay dividends at this time or in the future (see "RISK
FACTORS").

While  the  non-insurance  company  subsidiaries are not subject directly to the
dividend  and  other  distribution  limitations,  insurance  holding  company
regulations  govern  the  amount  which  a subsidiary within the holding company
system  may  charge  any of the Insurers for services (e.g., management fees and
commissions).  These  regulations may affect the amount of management fees which
may  be  paid by Pafco and Superior to Superior Group.  The management agreement
between  SIG and Pafco was assigned to Superior Group and provides for an annual
management  fee  equal to 15% of gross premiums.  A similar management agreement
with a management fee of 17% of gross premiums was entered into between Superior
and  Superior Group.  There can be no assurance that either the IDOI or the FDOI
will  not  in  the  future  require  a  reduction  in these management fees.  In
addition, neither Pafco nor IGF may engage in any transaction with an affiliate,
including  the  Company, without the prior approval of the IDOI (see "Regulatory
Actions"  above).

Underwriting  and  Marketing  Restrictions
During  the  past  several years, various regulatory and legislative bodies have
adopted  or proposed new laws or regulations to deal with the cyclical nature of
the  insurance industry, catastrophic events and insurance capacity and pricing.
These  regulations  include  (i) the creation of "market assistance plans" under
which  insurers  are  induced to provide certain coverages; (ii) restrictions on
the  ability  of  insurers  to  rescind  or otherwise cancel certain policies in
mid-term;  (iii)  advance notice requirements or limitations imposed for certain
policy  non-renewals;  and (iv) limitations upon or decreases in rates permitted
to  be  charged.

Risk-Based  Capital  Requirements
In  order  to enhance the regulation of insurer solvency, the NAIC has adopted a
formula  and  model law to implement risk-based capital ("RBC") requirements for
property  and  casualty  insurance  companies designed to assess minimum capital
requirements  and  to  raise  the  level  of  protection  that statutory surplus
provides  for  policyholder  obligations, Indiana and Florida have substantially
adopted  the  NAIC  model law and Indiana directly, and Florida indirectly, have
adopted  the  NAIC  model  Formula.  The  RBC  formula for property and casualty
insurers:  (i  )  underwriting,  which  encompasses  the  risk  of  adverse loss
developments  and inadequate pricing; (ii) declines in asset values arising from
credit  risk; (iii) declines in asset values arising from investment risks; (iv)
off-balance  sheet  risk  arising  from  adverse  experience from non-controlled
asset, guarantees for affiliates, contingent liabilities and reserve and premium
growth.  Pursuant  to the model law, insurers having less statutory surplus that
that  required  by  the  RBC  calculation  will be subject to varying degrees of
regulatory  action,  depending  on  the  level  of  capital  inadequacy.

The  RBC  model law provides for four levels of regulatory action. The extent of
regulatory  intervention  and  action  increases  as the level of surplus to RBC
decreases.  The  first level, the Company Action Level (as defined by the NAIC),
requires  and insurer to submit a plan of corrective actions to the regulator if
surplus  falls  below  200%  of  the  RBC amount. The Regulatory action level re
quires  an  insurer  to submit a plan containing corrective actions and requires
the relevant insurance commissioner to perform and examination or other analysis
and  issue a corrective order if surplus falls below 150% of the RBC amount. The
Authorized  Control  Level  gives the relevant insurance commissioner the option
either  to  take  the aforementioned actions or to rehabilitate or liquidate the
insurer  if  surplus  falls  below  70%  of  the  RBC  amount.

At  the time of filing of the unaudited annual statutory financial statements of
the  Company's  U.S.  insurance  subsidiaries with the FDOI and the IDOI for the
year  ended  December 31, 2002, the RBC calculations for Pafco and Superior were
in  excess  of  200%  of  the  RBC  amount, a level which required no corrective
action.  The  RBC  calculation  for IGF as of December 31, 2002 was in excess of
100%  of  the  RBC  amount,  which  was  above  the  authorized  control  level.

In  May 2003, pursuant to a reserve analysis completed by the consulting actuary
engaged  by  BDO  Seidman, LLP, the Company's and SIG's independent auditor, the
loss  and  LAE  reserves of Superior and Pafco were increased as of December 31,
2002.  These  reserve  adjustments,  along  with  resulting  adjustments  to the
permitted carrying values of certain assets of Superior, investments in Superior
American  and  Superior  Guaranty,  were  recorded in the 2002 audited statutory
financial  statement  filed  for  Superior with the FDOI.  Based on the adjusted
audited  statutory financial statements, the surplus for Superior fell below 70%
of  the  RBC  amount  and  the surplus level for Pafco was above 150% of the RBC
amount  as of December 31, 2002. As a result, there may be additional regulatory
actions taken by the insurance regulators in states in which the companies write
business.

The  NAIC  Insurance  Regulatory  Information  System  ("IRIS")  was  developed
primarily  to  assist  state  insurance departments in executing their statutory
mandate  to oversee the financial condition of insurance companies.  IRIS ratios
consist  of  twelve  ratios with defined acceptable ranges.  They are used as an
initial  screening  process  for  identifying  companies  that may be in need of
special  attention.  Companies that have several ratios that fall outside of the
acceptable  range  are  selected  for  closer  review  by the NAIC.  If the NAIC
determines  that  more  attention  may  be  warranted,  one  of  five  priority
designations  is  assigned and the insurance department of the state of domicile
is  then  responsible  for  follow-up  action.

Based  on  the December 31, 2002 statutory financials filed with the NAIC, Pafco
had  values outside of the acceptable ranges for five IRIS tests. These included
the  two-year overall operating ratio, the investment yield ratio, the change in
surplus  ratio,  the  liabilities  and  liquid  assets  ratio, and the estimated
current  reserve  deficiency  to  policyholders'  surplus  ratio.

Based  on  the  December  31,  2002  statutory  financials  filed with the NAIC,
Superior  had  values outside of the acceptable ranges for six IRIS tests. These
included  the  surplus aid to policyholders' surplus ratio, the two-year overall
operating  ratio,  the change in surplus ratio, the liabilities to liquid assets
ratio, the one-year reserve development to policyholders' surplus ratio, and the
two-year  reserve  development  to  policyholders'  surplus  ratio.

As  of  December  31,  2002, IGF had values outside of the acceptable ranges for
five  IRIS  tests. These included the change in net writings ratio, the two-year
overall  operating ratio, the change in surplus ratio, the liabilities to liquid
assets  ratio,  and  the  agent's  balances  to  policyholders'  surplus  ratio.

Guaranty  Funds;  Residual  Markets
The  insurance  company  subsidiaries also may be required under the solvency or
guaranty laws of most states in which they do business to pay assessments (up to
certain  prescribed  limits)  to  fund  policyholder  losses  or  liabilities of
insolvent  or  rehabilitated  insurance  companies.  These  assessments  may  be
deferred  or  forgiven  under  most  guaranty  laws  if  they  would threaten an
insurer's  financial  strength  and, in certain instances, may be offset against
future  premium  taxes.  Some  state  laws  and  regulations  further  require
participation by the insurance company subsidiaries in pools or funds to provide
some  types  of  insurance  coverage that they would not ordinarily accept.  The
Company  recognizes  its  obligations  for  guaranty  fund  assessments  when it
receives  notice  that an amount is payable to the fund.  The ultimate amount of
these  assessments  may  differ  from  that  which  has  already  been assessed.

It  is  not  possible to predict the future consequences of changes in state and
federal  regulation  on  the  Company's operations and there can be no assurance
that  laws  and  regulations  enacted in the future will not be more restrictive
than  existing  laws.

Employees
At  March  1,  2003, the Company and its subsidiaries employed approximately 233
full and part-time employees.  None of the Company's employees is represented by
either  unions  or  collective  bargaining agreements. The Company believes that
relations  with  its  employees  are  excellent.

RISK  FACTORS
The  following  factors,  in addition to the other information contained in this
report,  should  be  considered  in  evaluating  the  Company and its prospects.

The  Financial  Condition  of  the  Company  Has  Continued  to  Decline
The  Company  reported  losses  from  continuing  operations  of  $(29,745,000),
$(31,937,000)  and $(63,224,000) for 2002, 2001 and 2000, respectively.  Results
from continuing operations before the effects of income taxes, minority interest
and  amortization  expense  were  losses  of  $(21,589,000),  $(20,188,000)  and
$(18,387,000)  for  2002,  2001  and  2000 respectively. Further, the deficit in
shareholder's  equity  increased  from  $(89,146,000)  at  December  31, 2001 to
$(90,752,000)  at December 31, 2002.  There can be no assurance that the Company
can  continue  in  business  if  these  operating  losses  continue.

SIG's  Accountants  Have  Issued  Going  Concern  Opinions
SIG's  accountants  have  issued  reports  on  their  audits of the Consolidated
Financial Statements of SIG as of December 31, 2002 and 2001 which express doubt
as to SIG's ability to continue as a going concern given the recurring operating
losses  experienced  by  SIG  over  the past several years and SIG's net capital
deficiency.

Regulatory  Actions  May  Affect  the  Company's  Future  Operations
The  Company's  U.S.  insurance company subsidiaries, their business operations,
and  their  transactions  with affiliates, including the Company, are subject to
extensive  regulation  and  oversight  by  the  IDOI, the FDOI and the insurance
regulators  of  other  states  in which the insurance company subsidiaries write
business.  Moreover,  the  U.S.  insurance company subsidiaries' losses, adverse
trends  and  uncertainties discussed in this report have been and continue to be
matters  of  concern  to  the  domiciliary and other insurance regulators of the
Company's  U.S.  insurance  company  subsidiaries  and have resulted in enhanced
scrutiny  and regulatory action by several regulators. (See "Regulatory Actions"
and  "Risk-Based  Capital  Requirements").  The  primary  purpose  of  insurance
regulation  is the protection of policyholders rather than shareholders. Failure
to  resolve  issues  with the IDOI and the FDOI, and with other regulators, in a
manner satisfactory to the Company could impair the Company's ability to execute
its business strategy or result in future regulatory actions or proceedings that
could  otherwise  materially  and  adversely  affect  the  Company's operations.

The  Company  is  Subject  to  a  Number  of  Pending  Legal  Proceedings
As  discussed  elsewhere in this report, the Company and/or its subsidiaries are
involved  in  a  number  of  pending  civil  legal  proceedings  (see  "Legal
Proceedings").  Although  the  Company  believes that many of the allegations of
wrongdoing are without merit and intends to vigorously defend the claims brought
against  it,  there  can  be  no assurance that such proceedings will not have a
material  adverse  effect  on  the  Company's  financial  position or results of
operations.  Furthermore,  the  existence of these lawsuits diverts the time and
attention  of  management,  and  they  are  costly  to  defend.

The  Terms  of  the Trust Preferred Securities May Restrict SIG's Ability to Act
SIG  has  issued  through a wholly owned trust subsidiary $135 million aggregate
principal  amount  in  trust  originated  preferred  securities  ("Preferred
Securities").  The  Preferred  Securities  have  a  term of 30 years with annual
interest at 9.5% paid semi-annually. The obligations of the Preferred Securities
were  expected  to  be  funded  from  SIG's  nonstandard  automobile  insurance
management  company.  SIG elected to defer the semi-annual interest payments due
in  February and August 2000, 2001 and 2002 and the payment due in February 2003
and  may continue to defer such payments for up to an aggregate of five years as
permitted  by  the  indenture  for the Preferred Securities. All of the deferred
interest  (if  all payments due in 2003 and 2004 are deferred) approximating $84
million  will  become  due  and  payable  in February 2005. Although there is no
present  default  under  the  indenture that would accelerate the payment of the
Preferred  Securities,  the  indenture  contains  a number of covenants that may
restrict  SIG's  ability  to  act  in  the  future.  These  covenants  include
restrictions  on  SIG's  ability  to  incur  or  guarantee debt, make payment to
affiliates,  repurchase  its  common  stock,  pay  dividends  on common stock or
increase  its  level  of  certain  investments  other  than  investment-grade,
fixed-income  securities.  There  can be no assurance that compliance with these
restrictions  and other provisions of the indenture for the Preferred Securities
will  not  adversely  affect  the  cash  flow  of  SIG  and  the  Company.

SIG  May  Not  Be  Able  to  Satisfy Its Obligations to the Holders of the Trust
Preferred  Securities
SIG  may  continue  to  defer the semi-annual interest payments on the Preferred
Securities  for  up  to  an  aggregate  of  five  (5)  years as permitted by the
indenture  for  the  Preferred  Securities.  All  of  the  deferred  interest
(approximately  $84  million, if all payments due in 2003 and 2004 are deferred)
will  become  due  and  payable  in February 2005.  SIG relies on the payment of
finance  and  service fees by its subsidiaries to fund its operations, including
its  payment of interest on the Preferred Securities.  Certain state regulators,
including  the  FDOI,  have  issued  orders  prohibiting SIG's subsidiaries from
paying  such  fees  to SIG.  In the event such orders continue, SIG may not have
sufficient revenue to fund its operations or to pay the deferred interest on the
Preferred  Securities.  Such  failure to pay could result in a default under the
indenture  and  acceleration  of  the  payment  of  the  Preferred  Securities.

Uncertain  Pricing  and  Profitability
One of the distinguishing features of the property and casualty industry is that
its  products  are  priced before losses are reported and final costs are known.
Premium  rate  levels  are  related  in  part  to  the availability of insurance
coverage,  which  varies  according  to  the  level  of surplus in the industry.

Increases  in  surplus  have  generally  been  accompanied  by  increased  price
competition  among  property  and casualty insurers.  The nonstandard automobile
insurance  business,  in  recent years, has experienced very competitive pricing
conditions  and there can be no assurance as to the Company's ability to achieve
adequate  pricing.  Changes  in  case  law,  the  passage of new statutes or the
adoption  of  new  regulations  relating  to  the  interpretation  of  insurance
contracts  can  retroactively and dramatically affect the liabilities associated
with  known  risks  after  an  insurance contract is in place. New products also
present special issues in establishing appropriate premium levels in the absence
of  experience  with  such products' performance.  The level of claims cannot be
accurately determined for periods after the sale of policies, therefore reserves
are  estimated  and these estimates are used to set price. If they are low, then
resulting  rates  could  be  inadequate.

The  number  of  competitors  and the similarity of products offered, as well as
regulatory  constraints,  limit the ability of property and casualty insurers to
increase  prices  in  response  to  declines  in  profitability.  In states that
require  prior  approval  of rates, it may be more difficult for SIG's insurance
subsidiaries  to  achieve  premium  rates  that  are  commensurate  with  its
underwriting  experience  with  respect  to  risks  located  in  those  states.
Accordingly,  there  can  be no assurance that these rates will be sufficient to
produce  an  underwriting  profit.

The reported profits and losses of a property and casualty insurance company are
also  determined, in part, by the establishment of, and adjustments to, reserves
reflecting  estimates made by management as to the amount of losses and LAE that
will  ultimately be incurred in the settlement of claims. The ultimate liability
of  the insurer for all losses and LAE reserved at any given time will likely be
greater  or less than these estimates, and material differences in the estimates
may  have  a  material  adverse  effect  on  the insurer's financial position or
results  of  operations  in  future  periods.

Uncertainty  Associated  with  Estimating  Reserves  for  Unpaid  losses and LAE
The  reserves  for  unpaid losses and LAE established by the Company's insurance
subsidiaries  are  estimates  of  amounts  needed to pay reported and unreported
claims  and  related  LAE  based  on  facts  and circumstances then known. These
reserves  are based on estimates of trends in claims severity, judicial theories
of  liability  and  other  factors.

Although  the  nature  of  the  Company's  U.S. nonstandard automobile insurance
business  is  primarily short-tail, the establishment of adequate reserves is an
inherently  uncertain process, provides no assurance that the ultimate liability
will  not materially exceed the Company's reserves for losses and LAE and have a
material  adverse  effect  on  the Company's results of operations and financial
condition.  Due  to the inherent uncertainty of estimating these amounts, it has
been  necessary, and may over time continue to be necessary, to revise estimates
of  the  Company's  reserves  for  losses and LAE. The historical development of
reserves  for  losses  and  LAE may not necessarily reflect future trends in the
development  of  these  amounts.  Accordingly,  it  may  not  be  appropriate to
extrapolate  redundancies  or  deficiencies  based  on  historical  information.

Nature  of  Nonstandard  Automobile  Insurance  Business
The  nonstandard  automobile insurance business is affected by many factors that
can  cause  fluctuation  in the results of operations of this business.  Many of
these factors are not subject to the control of the Company or its subsidiaries.

The size of the nonstandard market can be significantly affected by, among other
factors,  the  underwriting  capacity  and  underwriting  criteria  of  standard
automobile  insurance carriers.  In addition, an economic downturn in the states
in  which  SIG  writes  business could result in fewer new car sales and reduced
demand  for  automobile  insurance.  These  factors,  together  with competitive
pricing  and  other  considerations,  could  result  in  fluctuations  in  SIG's
underwriting  results.

Highly  Competitive  Business
Nonstandard  automobile insurance is a highly competitive business.  Many of the
Company's  competitors  have  substantially greater financial resources than the
Company  and  there can be no assurance that the Company will be able to compete
effectively  against  such  competitors  in  the  future.

The  Company  competes  with  both  large  national writers and smaller regional
companies.  These  competitors  include companies which, like the Company, serve
the  independent  agency  market  and  companies that sell insurance directly to
consumers.  Direct  writers  may have certain competitive advantages over agency
writers,  including  increased name recognition, loyalty of the customer base to
the  insurer,  and  potentially  reduced acquisition costs. In addition, certain
competitors  of  the Company have from time to time decreased their prices in an
apparent  attempt  to gain market share.  Also, in certain states, assigned risk
plans  may  provide  nonstandard  automobile insurance products at a lower price
than private insurers. In addition, because the Company's nonstandard automobile
insurance  products  are  only  marketed  through independent insurance agencies
which  represent  more than one insurance company, the Company faces competition
within  each  agency.

Reliance  on  Independent  Insurance  Agents
The  NAG  market  and  sell  their  insurance  products  through  independent,
non-exclusive  insurance  agents  and  brokers. The agents and brokers also sell
competitors'  insurance  products.  The  NAG'  business depends, in part, on the
marketing  efforts  of those agents and brokers and the NAG must offer insurance
products  that  meet  the  requirements  of their customers. If those agents and
brokers  fail to market the NAG' products successfully, the NAG' business may be
adversely  affected.

Reliance  upon  reinsurance
In  order  to reduce risk and to increase underwriting capacity, the Nonstandard
Auto  Group purchases reinsurance.  Reinsurance does not relieve the Nonstandard
Auto  Group  of liability to the insureds for the risks ceded to reinsurers.  As
such,  the  Nonstandard Auto Group is subject to credit risk with respect to the
risks  ceded  to  reinsurers.  Although  the  Nonstandard  Auto  Group  places
reinsurance with reinsurers that it generally believes to be financially stable,
a  significant  reinsurer's  insolvency  or inability to make payments under the
terms of a reinsurance treaty could have a material adverse effect on SIG's, and
the  Company's,  financial  condition  or  results  of  operations.

The  amount  and  cost  of  reinsurance  available  to companies specializing in
property  and casualty insurance is subject, in large part, to prevailing market
conditions  beyond  the  control of such companies. The Nonstandard Auto Group's
ability to provide insurance at competitive premium rates and coverage limits on
a  continuing basis depends upon their ability to obtain adequate reinsurance in
amounts,  and  at  rates,  that  will  not  adversely  affect  their competitive
position.

Due  to  continuing  market  uncertainties  regarding  reinsurance  capacity, no
assurances  can  be given as to the Nonstandard Auto Group's ability to maintain
current  reinsurance  facilities, which generally are subject to annual renewal.
If  the  Nonstandard  Auto  Group  is unable to renew such facilities upon their
expiration and is unwilling to bear the associated increase in net exposures, it
may  need  to  reduce  its  levels  of  underwriting  commitments.

ITEM  2  -  PROPERTIES
The  Company's  headquarters  is  located  at  2 Eva Road, Suite 200, Etobicoke,
Ontario,  Canada  in  leased  space.

The  Company's  U.S.  offices  are located at 4720 Kingsway Drive, Indianapolis,
Indiana  in  office space subleased from Superior Group.  SIG's headquarters are
located  at  4720  Kingsway  Drive,  Indianapolis, Indiana in a building that is
owned  100% by Pafco with no encumbrances. Superior Group leases office space at
4720  Kingsway  Drive,  Indianapolis,  Indiana  from  Pafco.  The building is an
80,000  square foot multilevel structure; approximately 50% of which is utilized
by the Company and certain of its subsidiaries. The remaining space is leased to
third  parties  at  a  price of approximately $10 per square foot. All corporate
administration,  accounting  and  management  functions  are  contained  at this
location.

Superior's  operations  are  conducted at leased facilities in Atlanta, Georgia;
Anaheim,  California; and Tampa and West Palm Beach, Florida. Under a lease term
that  extends  through  2003,  Superior leases an office at 280 Interstate North
Circle,  N.W.,  and  Suite  500,  Atlanta,  Georgia.  Superior  leases an office
located  at 5483 West Waters Avenue, Suite 1200, Tampa, Florida for a lease term
extending  through  December  2007. Superior occupies a leased office located at
1745 West Orangewood, Anaheim, California for a lease term extending through May
2006. Superior occupies a leased office at 4500 PGA Blvd., Suite 304A, West Palm
Beach,  Florida  for  a  lease  term  extending  through  September  2007.

Claims  activities  are  conducted  in Atlanta, Indianapolis, Tampa and Anaheim.
Underwriting, customer service, and accounting and administration activities are
conducted  in  Indianapolis.

SIGF  is  located at 2300 Glades Road, Suite 135E, Boca Raton, Florida in leased
space.

The  Company  considers  all  of  its  properties  suitable and adequate for its
current  operations.

ITEM  3  -  LEGAL  PROCEEDINGS
Superior  Guaranty  is  a defendant in a case filed on November 26, 1996, in the
Circuit  Court  for  Lee County, Florida entitled Raed Awad v. Superior Guaranty
Insurance  Company,  et  al.,  Case No. 96-9151 CA LG.  The case purported to be
brought on behalf of a class consisting of purchasers of insurance from Superior
Guaranty.  The  plaintiffs  alleged  that  the defendant charged premium finance
service  charges  in  violation of Florida law. The parties have reached a class
settlement  which  has  been  approved  by  the court that is not expected to be
material  to  Superior  Guaranty.

As  previously reported, IGF, which is a wholly owned subsidiary of the Company,
had been a party to a number of pending legal proceedings and claims relating to
agricultural  production  interruption  insurance  policies (the "AgPI Program")
which  were sold during 1998. All of the policies of insurance which were issued
in the AgPI Program were issued by and under the name of Mutual Service Casualty
Insurance  Company  ("MSI"), a Minnesota corporation with its principal place of
business  located  in Arden Hills, Minnesota.  Sales of this product resulted in
large  underwriting  losses  by  IGF.

Approximately  $29  million  was paid through December 31, 2002 in settlement of
legal proceedings and policyholder claims related to the AgPI Program.  All AgPI
policyholder  claims  were  settled  during 2000. However, on January 12, 2001 a
case  was  filed in the Superior Court of California, County of Fresno, entitled
S&W  Seed Company, Dudley Silveira, Ric Blanchard and Darrell Silveira v. Mutual
Service  Casualty  Insurance  Company,  IGF  Insurance  Company,  and  Dibuduo &
Defendis  Insurance  Agency, Inc.; Case No. OICE CG 00137.  The case was brought
by four AgPI policyholders who had previously settled their AgPI claims pursuant
to  binding  settlement  agreements  who  now  seek  additional  compensation by
asserting through litigation that IGF and the third party carrier paid less than
the  policy  limits  they  were promised when they purchased the policy and that
each  settling  policyholder was forced to accept the lesser amount due to their
economic  duress  -  a legal theory recognized in California if certain elements
can  be  established.  The plaintiff's amended their complaint four times during
2002.  A  demurrer to the fourth amended complaint was filed by MSI and a motion
to  strike  was  filed by IGF, which were denied. IGF filed a motion for summary
judgment  to  dismiss  the claims in the plaintiff's fourth amended complaint on
the  basis  that releases previously executed by the plaintiffs are binding. The
court  granted  the  motion  for  summary judgment. The cross claims between the
selling brokers and MSI and IGF remain pending.  The trial is scheduled to begin
in  August  2003.

Superior  Guaranty  is  a  defendant  in a case filed on October 8, 1999, in the
Circuit  Court for Manatee County, Florida entitled Patricia Simmons v. Superior
Guaranty  Insurance  Company,  Case  No.  1999 CA-4635.  The case purports to be
brought on behalf of a class consisting of purchasers of insurance from Superior
Guaranty.  The  Plaintiffs  alleged  that  the  defendant  charged  interest  in
violation of Florida law. The parties have settled the case in an amount that is
not  material  to  the  Company's  financial  condition.

The  Company  is a defendant in a case filed on February 23, 2000, in the United
States District Court for the Southern District of Indiana entitled Robert Winn,
et  al. v. Symons International Group, Inc., et al., Cause No. IP 00-0310-C-B/S.
Other  parties  named  as  defendants are SIG, three individuals who were or are
officers  or  directors of the Company or of SIG, PricewaterhouseCoopers LLP and
Schwartz  Levitsky  Feldman, LLP. The case purports to be brought on behalf of a
class  consisting of purchasers of the Company's stock or SIG's stock during the
period  February  27, 1998, through and including November 18, 1999.  Plaintiffs
allege,  among  other  things, that defendants misrepresented the reliability of
the  Company's  reported  financial  statements,  data  processing and financial
reporting  systems,  internal controls and loss reserves in violation of Section
10(b) of the Securities Exchange Act of 1934 (the "1934 Act") and SEC Rule 10b-5
promulgated  thereunder. The individual defendants are also alleged to be liable
as  "controlling  persons"  under  Sec.20  (a)  of  the 1934 Act.  As previously
reported in the Company's September 30, 2002 Form 10-Q, the Company, SIG and the
individual  defendants  entered  into  an  agreement  with  the  plaintiffs  for
settlement.  The settlement is subject to certain terms and conditions and court
approval.

As  previously  reported,  SIG  and  two of its subsidiaries, IGFH and IGF, were
parties  to a "Strategic Alliance Agreement" dated February 28, 1998 (the "SAA")
with  Continental  Casualty  Company  ("CNA"),  pursuant  to  which IGF acquired
certain  crop insurance operations of CNA. The obligations of the Company, IGFH,
IGF and CNA under the SAA are the subject of an action filed on June 4, 2001 and
pending  in  United  States District Court for the Southern District of Indiana,
Indianapolis  Division.  Claims  have  also  been asserted in the action against
SIG,  Granite  Re,  Pafco,  Superior  and  certain members of the Symons family.
Discovery  is proceeding.  Although the Company continues to believe that it has
claims  against  CNA  and  defenses  to  CNA's claims which may offset or reduce
amounts owing by the Company or its affiliates to CNA, there can be no assurance
that  the  ultimate resolution of the claims asserted by CNA against the Company
and  its  affiliates  will not have a material adverse effect upon the Company's
and  its  affiliates'  financial  condition  or  results  of  operations.

Superior  was  a  defendant  in a case filed on May 8, 2001 in the United States
District  Court  Southern  District of Florida entitled The Chiropractic Centre,
Inc.  v. Superior Insurance Company, Case No. 01-6782.  The case purported to be
brought  on behalf of a class consisting of healthcare providers improperly paid
discounted  rates  on  services  to  patients  based  upon  a preferred provider
contract  with  a  third  party.  The plaintiff alleged that Superior breached a
third  party  beneficiary  contract, committed fraud and engaged in racketeering
activity  in  violation of federal and Florida law by obtaining discounted rates
offered  by  a  third  party  with  whom  the plaintiff contracted directly.  On
September 30, 2002, the court issued an administrative order which dismissed the
case.  The court's order administratively closing the case could be temporary or
permanent.  Superior  believes  that the allegations of wrongdoing as alleged in
the  complaint  were  without  merit  and  in  the event the order is temporary,
Superior  intends  to  vigorously  defend  the  claims  brought  against  it.

IGF  is a defendant in a case filed on December 31, 2002 in the Circuit Court of
Greene County, Missouri entitled Kevin L. Stevens v. Wilkerson Insurers, et al.,
Case  No.  102CC5135.  Other  parties named as defendants are the Company, SIGF,
Granite  Re,  Superior  Group  Management, Superior, Superior American, Superior
Guaranty,  Pafco  and three individuals who were or are officers or directors of
the  Company.  These  defendants  have  filed  motions  to  dismiss  for lack of
personal  jurisdiction  which  are  pending.  The case purports to be brought on
behalf of an IGF insured seeking to recover alleged damages based on allegations
of  bad  faith,  negligent  claims  handling and breach of fiduciary duties with
respect  to a claim which arose from an accident caused by the IGF insured.  IGF
believes  that  the  allegations  of  wrongdoing as alleged in the complaint are
without  merit  and  intends to vigorously defend the claims brought against it.

See  footnote  15  ("Commitment and Contingencies") and footnote 14 ("Regulatory
Matters")  to  the Company's consolidated financial statements in Part I of this
report,  incorporated  herein  by  reference,  for  additional  legal  matters.
The  Company  and  its  subsidiaries  are  named  as defendants in various other
lawsuits  relating  to  their  business  and  arising  in the ordinary course of
business.  Legal  actions arise from claims made under insurance policies issued
by  the  Company's  subsidiaries.  The  Company,  through  its  claims reserves,
reserves for both the amount of estimated damages attributable to these lawsuits
and  the  estimate  costs of litigation.  The Company believes that the ultimate
disposition  of  these  lawsuits  will  not  materially affect its operations or
financial  position.

ITEM  4  -  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS
None.

                                     PART II


ITEM  5  -  MARKET  FOR  THE  REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER
MATTERS
Information  regarding  the  trading  market for the Company's common stock, the
range of selling prices for each quarterly period since January 1, 2000, and the
approximate  number of holders of common stock as of December 31, 2002 and other
matters  is included under the caption "Market and Dividend Information" on page
43  of  the  2002  Annual  Report,  included as Exhibit 13, which information is
incorporated  herein  by  reference.

The  following  table  sets  forth  certain  information as of December 31, 2002
regarding  securities  of  the  Registrant  authorized  for  issuance  under the
Company's  equity  compensation  plans.  As  of  December  31,  2002, all of the
Company's equity compensation plans were approved by the Company's shareholders.
<TABLE>
<CAPTION>

                                                                               Number of securities
                                                                             remaining available for
                                Number of securities     Weighted-average     future issuance under
                                  to be issued upon     exercise price of   equity compensation plans
                                     exercise of           outstanding        (excluding securities
Plan category                    outstanding options         options         reflected in column (a))
-----------------------------  -----------------------  ------------------  --------------------------
<S>                            <C>                      <C>                 <C>
Equity compensation plans
 approved by shareholders . .                  428,750  $             0.85                     442,250
Equity compensation plans not
 approved by shareholders . .                       --                  --                          --
Total . . . . . . . . . . . .                  428,750  $             0.85                     442,250
</TABLE>

he  Company's  Share  Option  Plan  provides  it  with  the  authority  to grant
nonqualified  stock  options  and  incentive  stock  options to officers and key
employees  of the Company and its subsidiaries and nonqualified stock options to
non-employee directors of the Company.  Options have been granted at an exercise
price  equal  to  the fair market value of the Company's stock at date of grant.
The  outstanding  stock  options  vest  and  become exercisable at varying terms
ranging  from  immediate vesting to equal installments over terms up to 5 years.

ITEM  6  -  SELECTED  FINANCIAL  DATA
The  data  included on page 4 of the 2002 Annual Report, included as Exhibit 13,
under  "Selected  Financial  Data"  is  incorporated  herein  by  reference.

ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS
The  discussion  entitled  "Management's  Discussion  and  Analysis of Financial
Condition and Results of Operations" included in the 2002 Annual Report on pages
5  through  14  included  as  Exhibit  13  is  incorporated herein by reference.

ITEM  7A  -  QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK
The  discussion  entitled "Quantitative and Qualitative Disclosures About Market
Risk"  included  in  the  2002  Annual Report on pages 12 through 13 included as
Exhibit  13  is  incorporated  herein  by  reference.

ITEM  8  -  FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA
The  consolidated  financial  statements  in  the 2002 Annual Report included as
Exhibit  13,  and  listed  in Item 15 of this Report, are incorporated herein by
reference.

ITEM  9-  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING AND
FINANCIAL  DISCLOSURE.
None.

                                    PART III

ITEM  10.  DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT
DIRECTORS  OF  THE  REGISTRANT
The  following  table sets forth certain information regarding current directors
of  the  Company:

     NAME     AGE          DIRECTOR     SINCE
     Ron  L.  Foxcroft       57          2001
     John  K.  McKeating     67          1995
     J.  Ross  Schofield     62          1992
     David  B.  Shapira      56          1989
     Douglas  H.  Symons     51          1989
     G.  Gordon  Symons      81          1986
     Robert  C.  Whiting     71          2002

Dr.  Ron L. Foxcroft is the Chairman and Founder of  Fox 40 International, Inc.,
a manufacturing and distribution company and Chairman of Hamilton Terminals Inc.
Dr.  Foxcroft  was  named by Profit Magazine as Entrepreneur of the Decade.  Dr.
Foxcroft  received an honourary Doctor of Law Degree from McMaster University in
Canada  and  was  the  recipient  of the Award of Merit from B'Nai Brith Canada.

John  K.  McKeating  is  the  retired  former President of Vision 2120, Inc., an
optometry  company

J.  Ross  Schofield  is  the  Chairman  of Hargraft Schofield Ltd., an insurance
brokerage  company.

David  B.  Shapira  is  the  President,  Medbers  Limited, an investment holding
company

Douglas H. Symons served as the Company's Chief Operating Officer from July 1996
until  he  became its Chief Executive Officer in November 1999.  Mr. Symons also
served as Chief Executive Officer of the Company from 1989 until July 1996.  Mr.
Symons  has  been  a  director  of Goran since 1989 and  served as Goran's Chief
Operating Officer and Vice President from 1989 until May 31, 2002 when he became
Chief  Executive  Officer  and  President.  Mr.  Symons  is the son of G. Gordon
Symons.

G.  Gordon  Symons  has  been  Chairman of the Board of Directors of the Company
since  its  formation in 1987.  Mr. Symons founded the predecessor to Goran, the
73.8%  shareholder of the Company, in 1964 and has served as the Chairman of the
Board  of  Goran  since  its  formation  in 1986.  Mr. Symons also served as the
President  of  Goran  until  1992 and the Chief Executive Officer of Goran until
1994.  Mr.  Symons  currently serves as a director of Symons International Group
Ltd.  ("SIGL"),  a  Canadian  corporation controlled by him, which together with
members  of  the  Symons  family,  controls  Goran.  Mr.  Symons  also serves as
Chairman  of  the  Board  of Directors of all of the subsidiaries of Goran.  Mr.
Symons  is  the  father  of  Douglas  H.  Symons.

Robert  C.  Whiting  is  the  President  of Prime Advisors Ltd., a Bermuda based
insurance  consulting  firm.  From  its  inception  until June 1994, Mr. Whiting
served  as  President  and Chairman of the Board of Jardine Pinehurst Management
Co.,  Ltd.,  a  Bermuda  based  insurance  management  and  brokerage  firm.

COMPLIANCE  WITH  SECTION  16(A)  OF  THE  SECURITIES  ACT  OF  1934
Section  16(a)  of  the  Securities  Exchange Act of 1934 requires the Company's
officers  and  directors,  as  well  as  persons  who  own  more than 10% of the
outstanding  common shares of the Company, to file reports of ownership with the
Securities  and  Exchange  Commission.  Officers, directors and greater than 10%
shareholders  are  required  to  furnish  the Company with copies of all Section
16(a)  forms  they  file.  Based  solely  on  its review of copies of such forms
received  by  it, or written representations from certain reporting persons that
no  reports  were  required  for those persons, the Company believes that during
2002,  all filing requirements applicable to its officers, directors and greater
than  10%  shareholders  were  met  with  the  exception  of  a  Form  4 for the
acquisition  of  shares  of  the  Company.

EXECUTIVE  OFFICERS
Presented  below  is  certain information regarding the executive officer of the
Company  who is not also a director.  His age and positions with the Company are
as  follows:

     NAME                   AGE          POSITION

     John  G. Pendl          42          Vice President, Chief Financial Officer
                                         and  Treasurer

Mr.  Pendl  has  served as Vice President, Chief Financial Officer and Treasurer
since  October  2002.  From  1998  to  September  2002,  Mr. Pendl served as M&A
Analyst  and  Divisional  Controller  for  Collision  Team  of  America, Inc., a
subsidiary  of  Ford  Motor  Company.  Mr.  Pendl  also  held  various corporate
financial  positions  between  1991  and 1998, primarily with The Corange Group.
Finally,  Mr. Pendl served as a tax consultant with the firm of Price Waterhouse
from  1984  through 1990.  Mr. Pendl holds an MBA degree from Indiana University
and  is  a  Certified  Public  Accountant  in  the  State  of  Indiana.

ITEM  11  -  EXECUTIVE  COMPENSATION
The  following  table  shows the cash compensation paid by the Company or any of
its  subsidiaries  and  other  compensation  paid during the last three calendar
years  to  the  Company's  Chief Executive Officer during 2002 and the Company's
four other most highly paid executive officers during 2002 (the "named executive
officers").

SUMMARY  COMPENSATION  TABLE
<TABLE>
<CAPTION>
                                                   Annual Compensation     Long-Term
                                                                            Awards
-------------------------------------------------------------------------------------
                                                        Securities
Name and Principal                                       Underlying   All Other
 Position                 Year       Salary     Bonus    OptionsC     Compensation
---------------------  ----------  ----------  --------  --------  ------------------
<S>                      <C>         <C>         <C>       <C>       <C>
G. Gordon Symons, . .        2002  $        0  $      0         0  $         400,613R
Chairman of the Board        2001  $        0  $      0   250,000  $         448,672D
                             2000  $        0  $      0         0  $         403,638O
                       ----------  ----------  --------  --------  ------------------
Alan G. Symons,S. . .        2002  $        0  $      0         0  $         464,119Q
CEO and President . .        2001  $        0  $      0   200,000  $         400,000H
                             2000  $        0  $      0         0  $         401,638G
                       ----------  ----------  --------  --------  ------------------
Douglas H. Symons,. .        2002  $  461,463  $250,368I        0  $          17,526E
CEO and President . .        2001  $  375,000  $      0    60,000  $           1,651N
                             2000  $  375,000  $      0         0  $          45,846F
                       ----------  ----------  --------  --------  ------------------
John G. PendlJ. . . .        2002  $   72,361  $      0     1,000  $           1,981E
Vice President, CFO .        2001  $   14,807  $      0         0  $                0
---------------------  ----------  ----------  --------  --------  ------------------
Gene S. YerantK . . .        2002  $  235,105  $      0         0  $         262,371P
President, Superior .        2001  $  500,000  $    912         0  $          11,223M
Insurance Group, Inc.        2000  $  500,000  $250,000   100,000  $          21,635L
---------------------  ----------  ----------  --------   -------    ----------------
<FN>

Note  A     Salary,  bonus and other compensation are stated in U.S. dollars as the majority of payments are actually made in
            U.S.  dollars.
Note  B     Aggregate amounts are not greater than the lesser of $50,000 and 10% of the total of the annual salary and bonus.
Note  C     No  stock  appreciation  rights, restricted shares, or restricted share units were granted during any of the past
            three  completed  fiscal  years.  Amounts  reflect  stock  options  granted  during  2000,  2001  and  2002.
Note  D     Includes  $400,000  paid by a subsidiary of the Corporation, Granite Reinsurance Company Ltd., a Barbados company
            ("Granite  Re"),  to  companies  owned  by Mr. G. Gordon Symons and $48,672 of other compensation paid by the
            Corporation and  Granite  Re.
Note  E     Includes  $1,981  of health and life insurance premiums and $15,545 of medical expense reimbursement paid by SIG.
Note  F     Includes  $43,510  of  accrued  vacation  and  $2,336  of  health  and  life  insurance  premiums  paid  by  SIG.
Note  G     Includes a consulting fee paid to SIG Capital Fund, Ltd. of $400,000 and health insurance premiums of $1,638 paid
            by  SIG.
Note  H     Consulting  fee  of  $400,000  paid  to  SIG  Capital  Fund,  Ltd.
Note  I     Includes  $25,368  paid  by  SIG.
Note  J     Mr.  Pendl  joined  the  Corporation  on  October  8,  2001.
Note  K     Mr.  Yerant  joined  the  Corporation  on  January  10,  2000.  Mr.  Yerant's employment terminated May 20, 2002.
Note  L     Includes  $19,067  of  relocation  expenses  and  $2,568  of  health  and  life  insurance  premiums paid by SIG.
Note  M     Includes  $1,990  of  health  and  life  insurance  premiums  paid  by  SIG.
Note  N     Health  and  life  insurance  premiums  paid  by  SIG.
Note  O     Includes  consulting  fee of $400,000 paid by Granite Re and $1,638 of health and life insurance premiums paid by
            SIG.
Note  P     Includes  a  severance  payment  of  $250,000  and  $12,371  of  insurance  premiums.
Note  Q     Includes  consulting  fee  of $182,051 paid to SIG Capital Fund, Ltd. and  $282,068 paid pursuant to a consulting
            agreement  effective  May  31,  2002  between  the  Corporation,  Granite  and  AGS  Capital  Ltd.
Note  R     Includes  consulting  fee  of $400,000 paid by Granite Re and  $613 of health and life insurance premiums paid by
            SIG.
Note  S     Alan  G.  Symons  retired  on  May  31,  2002.
</TABLE>

OPTION  GRANTS  IN  LAST  FISCAL  YEAR
The  following  table  shows grants of options made during the fiscal year ended
December  31,  2002  to  each  of  the  named  executive  officers:
<TABLE>
<CAPTION>
                                  Individual Grants                                     Grant Date Value
                                 -------------------
                      Number of
                      Securities       Percent of total
                      Underlying      options granted to
                       Options       employees in fiscal    Exercise of   Expiration   Grant Date Present
Name                   granted               year           Base Price       date           Value $
-----------------  ----------------  --------------------  -------------  ----------  --------------------
<S>                <C>               <C>                   <C>            <C>         <C>
Douglas H. Symons                --                   --              --          --
                   ----------------  --------------------  -------------  ----------
G. Gordon. Symons                --                   --              --          --
                   ----------------  --------------------  -------------  ----------
Alan G. Symons. .                --                   --              --          --
                   ----------------  --------------------  -------------  ----------
John G. Pendl . .             1,000                  3.8%  $   .23 (Cdn)   10/1/2012  $          230 (Cdn)
                   ----------------  --------------------  -------------  ----------  --------------------
Gene S. Yerant. .                --                   --              --          --                    --
-----------------  ----------------  --------------------  -------------  ----------  --------------------
</TABLE>

OPTION  EXERCISES  AND  YEAR-END  VALUES
The  following table shows unexercised stock options held by the Company's named
executive  officers  at December 31, 2002.  In addition, this table includes the
number  of shares covered by both exercisable and non-exercisable stock options.
The  closing  TSX  stock price as of December 31, 2002 was $.60 (Cdn), which was
lower  than  the  option  exercise  prices; therefore, there were no unexercised
in-the-money  options.  There  were  no  exercises of stock options by the named
executive  officers  during  2002.



<TABLE>
<CAPTION>


                    VALUE OF
                     COMMON     NUMBER OF UNEXERCISED    UNEXERCISED IN THE
                     SHARES       OPTIONS AT FY END      MONEY OPTIONS ($)
                   ACQUIRED ON        AGGREGATE        EXERCISABLE/UNEXERCIS    EXERCISABLE/
NAME                EXERCISE       VALUE REALIZED               ABLE           UNEXERCISABLE1
-----------------  -----------  ---------------------  ----------------------  --------------
<S>                <C>          <C>                    <C>                     <C>

G. Gordon Symons.            0                      0               250,000/0             0/0
                   -----------  ---------------------  ----------------------  --------------
Alan G. Symons. .            0                      0                   0/0 2             0/0
                   -----------  ---------------------  ----------------------  --------------
Douglas H. Symons            0                      0                60,000/0             0/0
                   -----------  ---------------------  ----------------------  --------------
John G. Pendl . .            0                      0                 0/1,000             0/0
                   -----------  ---------------------  ----------------------  --------------
Gene S. Yerant. .            0                      0                   0/0 3             0/0
-----------------  -----------  ---------------------  ----------------------  --------------
<FN>

1     Based  on  the  TSX  closing  price  as  of  December  31,  2002  of  $.60  (Cdn.).
2     Alan  G.  Symons  forfeited  his  options  upon  retirement.
3     Mr.  Yerant  forfeited  his  options  upon  termination  of  employment.
</TABLE>

LONG  TERM  INCENTIVE  PLAN  AWARDS  IN  2002
There  were  no long-term incentive plan awards to the Company's named executive
officers  in  2002.

REPORT  ON  EXECUTIVE  COMPENSATION
The  Corporation's  Executive  Compensation  Policy  (the "Policy") considers an
individual's  experience,  market  conditions  (including  industry  surveys),
individual performance and the overall financial performance of the Corporation.
The  Corporation's  total  compensation  program  for  officers  includes  base
salaries,  bonuses  and  the grant of stock options pursuant to the Option Plan.
The  Corporation's  primary objective is to achieve above-average performance by
providing the opportunity to earn above-average total compensation (base salary,
bonus,  and  value  derived  from  stock options) for above-average performance.
Each  element  of  total compensation is designed to work in concert.  The total
program  is  designed  to  attract,  motivate,  reward and retain the management
talent  required  to  serve  shareholder,  customer and employee interests.  The
Corporation believes that this program also motivates the Corporation's officers
to  acquire  and retain appropriate levels of share ownership. It is the opinion
of  the  Compensation  Committee  that  the  total  compensation  earned  by the
Corporation's  officers  during  2002  achieves these objectives and is fair and
reasonable.

Compensation comprises base salary, annual cash incentive (bonus) opportunities,
and  long-term incentive opportunities in the form of stock options.  Individual
performance is determined in relation to short and long-term objectives that are
established  and  maintained  on  an  on-going  basis.  Performance  of  these
objectives  is  formally reviewed annually and base salary adjusted as a result.
Bonus  rewards  are  provided  upon  the  attainment  of  corporate  financial
performance  objectives  as well as the individual's direct responsibilities and
their  attainment  of  budget  and  other  objectives.

The  Policy also strives to establish long-term incentives to executive officers
by aligning their interests with those of the Corporation's shareholders through
award opportunities that can result in the ownership of the Corporation's common
shares.

The  compensation  of Alan G. Symons, Chief Executive Officer of the Corporation
until  May  31,  2002,  was  determined  pursuant to the arrangement between the
Corporation  and SIG Capital Fund, Ltd.  Under the arrangement, a consulting fee
was  paid to SIG Capital Fund, Ltd. with respect to the provision of services by
Alan  G. Symons.  Alan G. Symons was not paid a salary by the Corporation.  Upon
the  resignation  of  Alan  G.  Symons,  Douglas  H.  Symons was appointed Chief
Executive Officer, President and Secretary of the Corporation.  The Compensation
Committee  reviewed  and  increased  the  salary  of  Douglas H. Symons upon his
appointment  as  Chief  Executive  Officer  and President of the Corporation and
approved  the payment by the Corporation of the annual salary obligations of SIG
and the Corporation.  The Compensation Committee also approved a retention bonus
in  2002  for  Douglas  H.  Symons.  During 2002, the board of directors did not
grant any additional stock options to the Chief Executive Officer.  The board of
directors  also approved the grant of 26,000 additional stock options to certain
officers,  directors  and  employees  of  the  Corporation  during  2002.

COMPENSATION  COMMITTEE
Dr.  Ron  Foxcroft,  Chairman
J.  Ross  Schofield
Douglas  H.  Symons

COMPENSATION  COMMITTEE  INTERLOCKS  AND  INSIDER  PARTICIPATION
The  Company's  Compensation  Committee  consisted  of Dr. Ron Foxcroft, J. Ross
Schofield  and Douglas H. Symons. Neither Dr. Foxcroft nor Mr. Schofield has any
interlocks reportable under Item 402(j)(3) of Regulation S-K.  Douglas H. Symons
has  served  as  a  director  and  executive  officer of the Company since 1989.
Douglas  H.  Symons  is  also  an  executive  officer  of  each of the Company's
subsidiaries.  G.  Gordon Symons, Chairman of the Company, is a director of each
of  the Company's subsidiaries and is empowered to determine the compensation of
the  executive  officers  of  the Company's subsidiaries.  Alan G. Symons was an
executive officer and director of the Company and its subsidiaries until May 31,
2002.

COMPENSATION  OF  DIRECTORS
In  2002, the Company's directors received a flat annual fee of $10,000 for each
director  and  a  $1,000  fee for each committee meeting attended.  In addition,
committee  chairmen received an additional $1,500 per quarter.  During 2002, the
Company  also paid Robert C. Whiting a $10,000 fee for services as an officer of
Granite  Reinsurance  Company  Ltd.,  a  subsidiary  of  the  Company.

EMPLOYMENT  AGREEMENTS
Certain  of  the  Company's officers have entered into employment contracts with
the  Company  or  one  of  its  subsidiaries.

Douglas  H.  Symons,  Chief  Executive  Officer of the Company, is subject to an
employment  agreement, with such agreement calling for a base salary of not less
than  $500,000  per  year.  This  agreement became effective on May 31, 2002 and
continues  in effect for an initial period of two years.  Upon the expiration of
the initial two-year period, the term of the agreement is automatically extended
from  year  to  year thereafter and is cancelable upon six months' notice.  This
agreement  contains  customary  restrictive covenants respecting confidentiality
and  non-competition during the term of employment and for a period of two years
after  the  termination of the agreement.  In addition to annual salary, Douglas
H.  Symons  may earn a bonus in an amount ranging from 0 to 100% of base salary.
At  the  discretion  of  the board, bonus awards may be greater than the amounts
indicated  if  agreed  upon  financial  targets  are exceeded.  Upon a change of
control of the Company or Symons International Group, Inc. and in the event of a
non-renewal  of  Douglas  H.  Symons' employment agreement, Douglas H. Symons is
entitled  to  a  severance  amount equal to two years salary.  Douglas H. Symons
became the Chief Executive Officer and President of the Company on May 31, 2002,
and  the  Company approved the payment of the Company's and Symons International
Group, Inc.'s annual salary obligations under the employment agreement effective
as  of  May  31,  2002.

The  Company and Granite Reinsurance Company Ltd. have entered into a consulting
agreement  with AGS Capital Ltd. under which Alan G. Symons, the Chief Executive
Officer  of the Company until May 31, 2002, provides certain consulting services
to  the  Company  and  Granite  Re.  The  agreement provides compensation in the
amount of $500,000 per year, is for an initial term of one year, and the term of
the  agreement  is  automatically  extended  from year to year thereafter unless
terminated  upon  ninety  days'  prior  notice.

The  Company,  Symons  International Group, Inc. and Granite Reinsurance Company
Ltd.  have  entered into an employment agreement with G. Gordon Symons, Chairman
of  the  Board of the Company, pursuant to which G. Gordon Symons is entitled to
receive  from  Granite Re an annual sum of $150,000. Upon a change of control of
the Company or Symons International Group, Inc., G. Gordon Symons is entitled to
a payment in the amount of $1,125,000. In the event Granite Re shall fail to pay
the  annual amount due under the agreement, the Company and Symons International
Group,  Inc.  become  jointly  and  severally  liable  for  such  amounts.

The Company, Symons International Group, Inc., Granite Reinsurance Company Ltd.,
Goran  Management  Bermuda  Ltd.  ("Goran  Bermuda")  and  G. Gordon Symons have
entered  into  a consulting agreement pursuant to which Goran Bermuda, an entity
controlled  by G. Gordon Symons, is entitled to an annual sum of $250,000.  Upon
a  change  of  control of the Company or Symons International Group, Inc., Goran
Bermuda  is  entitled  to  a  payment  in the amount of $1,875,000. In the event
Granite  Re  shall  fail  to  pay the annual amount due under the agreement, the
Company and Symons International Group, Inc. become jointly and severally liable
for  such  amounts.

The  Company  and  Symons  International  Group, Inc. entered into an employment
agreement  with  David  N.  Hafling  under which he serves as Vice President and
Chief  Actuary  of  Symons  International  Group,  Inc.  The  agreement  became
effective  on  October  15,  2001  and  continues  until December 31, 2004.  The
agreement  is  automatically  renewed  for  one  year  periods thereafter unless
earlier terminated upon 60 days advance notice.  The agreement provides that Mr.
Hafling  will  receive  a  base salary of not less than $150,000 annually and an
annual  bonus  of  up  to  $30,000.

The  Company  and  Symons  International  Group, Inc. entered into an employment
agreement  with Gregg F. Albacete,  Vice President and Chief Information Officer
of  Symons  International Group, Inc.  The agreement became effective on January
26,  2000 for an initial term of three years and was automatically renewable for
one-year  periods  thereafter  unless sooner terminated.  The agreement provided
for  a  base salary of not less than $175,000 annually and an annual bonus of up
to  $75,000.  This  agreement  terminated  on  January  31,  2003.

The  Company  and  Symons  International  Group, Inc. entered into an employment
agreement  with Gene S. Yerant under which he served as Executive Vice President
of  the  Symons  International  Group,  Inc. and President of Superior Insurance
Group,  Inc.,  a  subsidiary  of  the Company. The agreement became effective on
January 10, 2000 and was terminated on May 20, 2002.  The agreement provided for
a  base  salary  of  $500,000 annually and a bonus of up to 100% of salary based
upon  achievement  of certain performance objectives.  Following the termination
of  the  employment  of  Gene  S. Yerant on May 20, 2002, the Company and Symons
International  Group,  Inc.  entered  into  an  agreement  with Mr. Yerant which
provided  for  two separation payments of $250,000 each, both of which were paid
as  of  January  31,  2003.

PERFORMANCE  GRAPH
The following performance graph compares the cumulative total shareholder return
on the Corporation's common stock with the TSX/S&P Composite Index for the years
1998  through  2002.

                                                [GRAPHIC OMITED]

Notwithstanding  anything  to the contrary set forth in any of the Corporation's
previous  filings under the Securities Act of 1993, as amended or the Securities
Exchange Act of 1934, as amended, that may incorporate future filings (including
this  Management  Proxy  Circular, in whole or in part), the preceding Report on
Executive  Compensation  and  the  historical  Performance  Graph  shall  not be
incorporated  by  reference  in  any  such  filings.

ITEM  12  -  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS AND MANAGEMENT
The  following  table  shows, as of April 21, 2003, the number and percentage of
shares  of  common stock of the Company held by each person known to the Company
to  own beneficially more than five percent of the issued and outstanding common
stock  of  the  Company,  and  the  ownership interests of each of the Company's
directors and named executive officers, and all directors and executive officers
of  the Company as a group, in the common stock of the Company and in the common
stock  of the Company's 73.8% shareholder, Goran.  Unless otherwise indicated in
a  footnote  to the following table, each beneficial owner possesses sole voting
and  investment  power  with  respect  to  the  shares  owne

<TABLE>
<CAPTION>
                                       SYMONS INTERNATIONAL GROUP, INC.                       GORAN CAPITAL INC.
                                       --------------------------------                        -------------------
                                                  AMOUNT AND                                  AMOUNT AND
                                                  NATURE OF                                   NATURE OF
                                                  BENEFICIAL                 PERCENT OF       BENEFICIAL  PERCENT OF
NAME                                              OWNERSHIP                     CLASS         OWNERSHIP      CLASS
-------------------------------------  --------------------------------  -------------------  ----------  -----------
<S>                                    <C>                               <C>                  <C>         <C>

G. Gordon Symons1 . . . . . . . . . .                           520,000                 4.8%   2,375,524        42.1%
                                       --------------------------------  -------------------  ----------  -----------
Douglas H. Symons3. . . . . . . . . .                           245,500                 2.3%     311,455         5.7%
                                       --------------------------------  -------------------  ----------  -----------
Alan G. Symons2 . . . . . . . . . . .                            72,691                   *      568,065        10.5%
                                       --------------------------------  -------------------  ----------  -----------
J. Ross Schofield4. . .. . . . . . .                             28,500                   *       29,800           *
                                       --------------------------------  -------------------  ----------  -----------
David B. Shapira4 . . . . . . . . . .                            28,500                   *      115,000         2.1%
                                       --------------------------------  -------------------  ----------  -----------
John K. McKeating5. . . . . . . . . .                            51,000                   *       17,000           *
                                       --------------------------------  -------------------  ----------  -----------
Dr. Ron Foxcroft6. . . . . . . . . . .                                0                   0       31,000           *
                                       --------------------------------  -------------------  ----------  -----------
Robert C. Whiting7 . . . . . . . . . .                           77,800                   *       35,000           *
                                       --------------------------------  -------------------  ----------  -----------
Goran Capital Inc.. . . . . . . . . .                         7,666,283                73.8%           0           0
                                       --------------------------------  -------------------  ----------  -----------
All executive officers and directors
 as a group (9 persons) . . . . . . .                           858,191                 7.7%   3,487,844        60.5%
-------------------------------------  --------------------------------  -------------------  ----------  -----------
<FN>

     *  Less  than  1%  of  class.

1    With  respect  to  the  shares of SIG, 10,000 shares are owned directly and
     510,000  shares  may  be  purchased  pursuant  to  stock  options  that are
     exercisable  within  60  days.  With  respect to the shares of the Company,
     479,111  shares  are held by trusts of which Mr. Symons is the beneficiary,
     1,646,413  of  the shares indicated are owned by Symons International Group
     Ltd.,  of  which  Mr.  Symons  is  the controlling shareholder, and 250,000
     shares  are  subject  to  options  exercisable  within  60  days.
2    With respect to the shares of the Company, 387,215 are held by a trust over
     which  Mr.  Symons  exercises  limited  direction,  and  180,850  are owned
     directly.
3    With respect to shares of SIG, 35,500 shares are owned directly and 210,000
     shares  may  be  purchased  pursuant  to stock options that are exercisable
     within  60  days. With respect to shares of the Company, 251,455 shares are
     owned  directly  and  60,000  shares  are  subject  to  options  that  are
     exercisable  within  60  days.
4    With  respect  to shares of SIG, 27,500 shares may be purchased pursuant to
     stock  options  exercisable  within  60 days. With respect to shares of the
     Company,  15,000  shares  may  be  purchased  pursuant  to  stock  options
     exercisable  within  60  days.
5    With  respect  to shares of SIG, 47,000 shares may be purchased pursuant to
     stock  options  that are exercisable within 60 days. With respect to shares
     of  the  Company,  15,000 shares may be purchased pursuant to stock options
     exercisable  within  60  days.
6    With  respect  to  shares  of  the  Company, 15,000 shares may be purchased
     pursuant  to  stock  options  that  are  exercisable  within  60  days.
7    With  respect  to shares of SIG, 28,000 shares may be purchased pursuant to
     stock options exercisable within 60 days, and with respect to shares of the
     Company,  15,000  shares  may  be  purchased  pursuant  to  stock  options
     exercisable  within  60  days.

</TABLE>

ITEM  13  -  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
1997,  Symons International Group, Inc. a subsidiary of the Corporation ("SIG"),
guaranteed  a  personal  loan  by  an unrelated third party lender to Douglas H.
Symons  in  the  amount  of  $250,000.  During 2002, the loan was renewed by the
unrelated  third  party  lender,  and  SIG  did  not  renew  its  guarantee.

As  of  December  31,  2002,  Symons International Group Ltd., a private company
("SIGL"),  was indebted to the Corporation in the amount of approximately (U.S.)
$1,743,000.  This  indebtedness  does  not  bear  interest.   During  2002,  the
Corporation  paid  SIGL  $400,000  for  consulting  services  which  include
reinsurance,  investment  banking  and  other  miscellaneous matters.  G. Gordon
Symons,  a  director  of  the  Corporation,  is the majority shareholder of SIGL
(which  is an insider of the Corporation), and Alan G. Symons (who is an insider
of  the Corporation) and Douglas H. Symons (who is a director and officer of the
Corporation)  own  a  minority  interest  in  SIGL.

As  of  December  31, 2002, Symons Underwriting Managers Ltd., a private company
("SUML"),  was indebted to the Corporation in the amount of approximately (Cdn.)
$3,340,000.  This  indebtedness  does  not  bear  interest and is secured by the
pledge  of  100,000  shares of the Corporation.  SIGL is the sole shareholder of
SUML.

SIG  paid  $12,967  to  Stargate  Solutions Group, Inc. ("Stargate") in 2002 for
consulting  and  other  services  related  to  the  Corporation's  non-standard
automobile operating system.  Stargate is owned by Kirk Symons, son of G. Gordon
Symons  and  brother  of  Alan  G.  Symons  and  Douglas  H.  Symons.

Superior  Insurance  Group,  Inc., a wholly owned subsidiary of the Corporation,
owns a less than 1% limited partnership interest in Monument Capital Partners I.
The  amount of the investment was $100,000.  Larry S. Wechter, a director of SIG
until  August  12,  2002,  is  Managing  Director and Chief Executive Officer of
Monument  Advisors,  Inc. and Alan G. Symons is a director of Monument Advisors,
Inc.  Monument  Advisors,  Inc.  is  the  general  partner  of  Monument Capital
Partners  I.

The  Corporation  leases  office space in Toronto, Canada from Tritech Financial
Systems  Inc.  ("Tritech").  Tritech  is  owned  by  Robert T. Symons, son of G.
Gordon  Symons  and  brother of Alan G. Symons and Douglas H. Symons.  The total
amount  paid  during  2002  was  $34,000.

In  1999, Granite Reinsurance Company Ltd. issued a performance bond in favor of
Tritech in the amount of $328,000.  In August 2000 the creditor called the bond.
The  bond  is  secured  by  a  guarantee from Tritech, a personal guarantee from
Robert T. Symons and a pledge of 50,000 shares of the Corporation's common stock
owned  by  Robert  T.  Symons.  Tritech  is  paying  interest on the outstanding
balance  at  an  annual rate of 7.5%.  During 2002, Tritech paid interest to the
Corporation  on  the  bond  of  $24,600.

During  2002,  SIG paid David G. Symons approximately $7,076 for legal services.
David  G.  Symons  is  the  son  of  Alan  G.  Symons.

INDEBTEDNESS  OF  OFFICERS  AND  DIRECTORS  OF  THE  CORPORATION
The  following  directors  and  officers of the Corporation and their associates
were  indebted  to  the  Corporation,  or its subsidiaries, in amounts exceeding
(Cdn.)  $25,000 during 2002.  All amounts listed in this section are denominated
in  U.S.  Dollars  based  upon  the  March  28,  2003 inter-bank market rate for
currency  exchange.  The  approximate  aggregate  indebtedness  of all officers,
directors,  employees  and  former  officers,  directors  and  employees  of the
Corporation or any of its subsidiaries entered into primarily in connection with
a  purchase  of  securities of the Corporation or its subsidiary as of April 21,
2003  was  $1,746,264.  The  aggregate indebtedness of all other indebtedness of
all  officers,  directors,  employees  and  former  officers  and  directors and
employees of the Corporation or any of its subsidiaries as of April 21, 2003 was
$1,680,887.


<TABLE>
<CAPTION>



                                                LARGEST LOAN BALANCE   BALANCE AS OF
NAME AND PRINCIPAL POSITION       DATE OF LOAN        DURING 2002    APRIL 21, 2003
                              ---------------------  --------------  ---------------
<S>                                    <C>                  <C>               <C>
June 27, 1986                       $115,8071              $0
June 30, 1986                       $156,4951           $129,112
G. Gordon Symons                  Prior to 1997         $30,0242         $30,752
Chairman of the Board             July 12, 2001        $832,7513         $29,733
----------------------------  ---------------------  --------------  ---------------
June 30, 1986                        $6,6174               $0
February 25, 1988                   $27,3094            $27,309
March 19, 1998                      $15,2935            $15,293
October 28, 1999                    $119,5006           $121,125
Alan G. Symons                  November 17, 2000     $1,145,8207      $1,149,398
CEO and President (14)            July 26, 2002        $130,7947        $131,203
                              ---------------------  --------------  ---------------
Prior to 1997                       $66,25613           $66,256
June 30, 1986                       $9,79813               $0
February 24, 1988                    $2,2198             $2,219
September 29, 1999                  $119,5009           $121,125
October 20, 1999                   $418,25010           $423,938
June 28, 2000                       $80,00013           $80,000
Douglas H. Symons (15)          November 17, 2000      $675,9347        $678,042
CEO, President and               March 23, 2001        $103,37211       $103,630
Secretary                         June 4, 2001         $50,00013         $50,000
October 15, 2001                   $202,72112           $180,317
July 26, 2002                       $76,6547            $77,898
----------------------------  ---------------------  --------------
<FN>

1    The  loans  by  the  Corporation  to  G. Gordon Symons in 1986 were made to
     facilitate the purchase of common shares of the Corporation. Such loans are
     collateralized by pledges of the common shares of the Corporation acquired,
     are  payable  on  demand  and  are  interest  free.
2    The  loan by the Corporation prior to 1997 was made to an entity controlled
     by  G.  Gordon  Symons,  is  unsecured  and  bears  no  interest.
3    The  loan  by  Granite  Reinsurance Company Ltd. to G. Gordon Symons in the
     principal  amount  of  $800,000  was  made  during 2001 at 6% interest. The
     principal  amount  was  repaid  on  April  1,  2002.  The balance remaining
     represents  interest  on  the  loan.
4    The  loans  by the Corporation to Alan G. Symons in 1986 and 1988 were made
     to  facilitate  the  purchase  of  common  shares  of  the Corporation, are
     collateralized  by  a  pledge  of  the  common  shares  of  the Corporation
     acquired,  are  payable  on  demand  and  are  interest  free.
5    The  loan  by  SIG  to Alan G. Symons on March 19, 1998 was made to satisfy
     obligations  to  third  parties. Such loan was inadvertently referred to in
     the  Corporation's  2002 Proxy Statement as a loan by the Corporation. Such
     loan  was secured by a pledge of his options to purchase shares in Superior
     Insurance Group Management, Inc. (formerly, GGS Management Holdings, Inc.),
     a subsidiary of the Corporation, and bore interest at the rate of 5.85% per
     year.  The  principal  of  the  loan  was  repaid  during 1999. The balance
     remaining  represents  interest  on  the  loan.
6    The loan by SIG to Alan G. Symons on October 28, 1999 was made to pay third
     party  indebtedness  secured  by  common shares of the Corporation and SIG.
     Such  loan  was  inadvertently  referred to in the Corporation's 2002 Proxy
     Statement  as  a  loan by the Corporation. Such loan is unsecured and bears
     interest  at  the  rate  of  6.5%  per  year  and  is  payable  on  demand.
7    In  April  1999,  the  Corporation guaranteed loans from an unrelated third
     party to Alan G. Symons and Douglas H. Symons in the approximate amounts of
     $1,552,000  and  $945,000,  respectively. Such guarantee was in place until
     November  17,  2000  at  which  time  the Corporation made loans to Alan G.
     Symons  and  Douglas  H.  Symons  in  the  amounts of $630,392 and $369,608
     respectively.  On  April 19, 2001, the Corporation made additional loans to
     Alan  G.  Symons  and  Douglas  H.  Symons  in  the amounts of $470,250 and
     $279,750,  respectively,  and Alan G. Symons and Douglas H. Symons executed
     amended  promissory  notes  in  the  aggregate  amount  of  $1,100,642  and
     $649,358,  respectively.  These  notes bear interest at variable rate based
     upon  the  Royal  Bank  of  Canada's rate paid on deposits. At December 31,
     2002, the total accrued interest on the amended promissory notes of Alan G.
     Symons  and  Douglas  H.  Symons was $45,178 and $26,576, respectively. The
     proceeds of all of such loans were used to reduce the principal outstanding
     on  the  third  party  loans.  The Corporation's guarantee to the unrelated
     third  party  is  with  regard  to the remaining balance of the third party
     loans  ($358,189  and  $212,748  to  Alan  G. Symons and Douglas H. Symons,
     respectively)  secured  by  a  pledge of certain shares of SIG owned by the
     Corporation.  In  turn,  Alan G. Symons and Douglas H. Symons have executed
     guarantees  in  favor  of  the Corporation which are triggered in the event
     that the Corporation is required to perform its guarantee to such unrelated
     third  party.  The  guarantees  by Alan G. Symons and Douglas H. Symons are
     secured  by all shares of SIG and the Corporation held respectively by Alan
     G.  Symons  and  Douglas  H. Symons. On July 26, 2002 additional loans were
     made to Alan G. Symons and Douglas H. Symons in the amounts of $125,480 and
     $74,520,  respectively.  These  notes  bear interest at variable rate based
     upon  the  Royal  Bank  of  Canada's rate paid on deposits. At December 31,
     2002,  accrued interest on these loans was $5,314 and $3,134, respectively.
8    The  loans  by  the  Corporation  to Douglas H. Symons in 1988 were made to
     facilitate the purchase of common shares of the Corporation. Such loans are
     collateralized by pledges of the common shares of the Corporation acquired,
     are  payable  on  demand  and  are  interest  free.
9    The  loan  by  SIG  to  Douglas H. Symons on September 29, 1999 was made to
     satisfy  indebtedness  to  third  parties.  Such  loan  is unsecured, bears
     interest  at  the  rate  of  6.5%  per  year  and  is  payable  on  demand.
10   The  loan  by  the Corporation to Douglas H. Symons on October 20, 1999 was
     made  to  satisfy  indebtedness  to  third parties. Such loan is unsecured,
     bears  interest  at  the  rate  of  6.5% per year and is payable on demand.
11   The  loan  by  the  Corporation  was  an  advance and bears interest at the
     Corporation's  short  term  funds  rate.
12   The loan by Symons International Group (Florida), Inc., a subsidiary of the
     Corporation,  on  October  15, 2001, was an advance against bonus for 2002.
     Such  loan  is  unsecured, bears interest at the rate of 6% per year or the
     applicable  federal  rate,  whichever  is  higher and was due no later than
     March  31,  2003.  Douglas  H.  Symons  was  unable  to repay the loan upon
     maturity  and  has  agreed  to  enter  into  a  repayment  plan  with  the
     Corporation.
13   The  loan  by  SIG  represents  an  advance  and  does  not  bear interest.
14   Alan  G.  Symons  retired  on  May  31,  2002.
15   Douglas  H.  Symons  became CEO and President of the Corporation on May 31,
     2002.
</TABLE>

                                     PART IV

ITEM  14  -  CONTROLS  AND  PROCEDURES
EVALUATION  OF  DISCLOSURE  CONTROLS  AND  PROCEDURES
The  Company  and  SIG  maintain  disclosure controls and procedures designed to
ensure  that  information  required  to  be disclosed in reports filed under the
Securities  Exchange Act of 1934, as amended, is recorded, processed, summarized
and reported within the specified time periods.  Within the 90 days prior to the
date  of filing this Annual Report on Form 10-K, the Company and SIG carried out
evaluations,  under  the supervision and with the participation of the Company's
and  SIG's management, including the Company's CEO,  the Company's CFO and SIG's
CFO, of the effectiveness of the design and operation of the Company's and SIG's
disclosure  controls  and procedures pursuant to Exchange Act Rule 13a-14. Based
upon  that  evaluation,  the  Company's  CEO,  the  Company's  CFO and SIG's CFO
concluded  that  the  Company's and SIG's disclosure controls and procedures are
effective  in  timely  alerting  them  to  material  information relating to the
Company  and  SIG  (including  their  consolidated  subsidiaries) required to be
included  in  the  Company's  periodic  SEC  filings.

CHANGES  IN  INTERNAL  CONTROLS
There  have  been  no  significant  changes  in  the Company's or SIG's internal
controls, or in other factors that could significantly affect internal controls,
subsequent  to  the  date  of  the  evaluation  described  above ("EVALUATION OF
DISCLOSURE  CONTROLS AND PROCEDURES").  No corrective actions were required with
regard  to  significant  deficiencies  and  material  weaknesses.

ITEM  15  -  EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES  AND REPORTS ON FORM 8-K
The  documents  listed  below  are  filed  as  a  part of this Report, except as
otherwise  indicated:

1.     Financial  Statements.  The  following  consolidated financial statements
found  on  the  pages  of the 2002 Annual Report are incorporated into Item 8 of
this  Report  by  reference:

                         Location  in
Description  of  Financial  Statement  Item          2002  Annual  Report
-------------------------------------------          --------------------

Reports  of  Independent  Accountants                            Page  42

Consolidated  Balance  Sheets,  December  31,
2002  and  2001                                                  Page  15

Consolidated  Statements  of  Operations,  Years
Ended  December  31,  2002,  2001  and  2000                     Page  16

Consolidated  Statements  of  Changes  In
Stockholders'  Equity  (Deficit),  Years  Ended
December  31,  2002,  2001  and  2000                            Page  17

Consolidated  Statements  of  Cash  Flows,
Years  Ended  December  31,  2002,  2001  and  2000              Page  18

Notes  to  Consolidated  Financial  Statements,
Years  Ended  December  31,  2002,2001  and  2000          Pages  19 - 40

2.     Financial  Statement  Schedules.  The  following  financial  statement
schedules  are  included  beginning  on  page  27:

Reports  of  Independent  Accountants

Schedule  II  -  Condensed  Financial  Information  of  Registrant

Schedule  IV  -  Reinsurance

Schedule  V  -  Valuation  and  Qualifying  Accounts

Schedule  VI - Supplemental Information Concerning Property - Casualty Insurance
Operations

3.     Exhibits.  The  Exhibits  set  forth  on  the  Index  to  Exhibits  are
incorporated  herein  by  reference.

4.     Reports  on Form 8-K: No reports on Form 8-K were filed during the fourth
quarter  of  2002.


<PAGE>
Board  of  Directors  and  Stockholders  of
Goran  Capital  Inc.  and  Subsidiaries

The  audit  referred  to  in  our  report  dated  May  9,  2003, relating to the
consolidated financial statements of Goran Capital, Inc. and subsidiaries, which
is incorporated in Item 8 of this Form 10-K by reference to the annual report to
shareholders  for  the  year  ended  December 31, 2002 included the audit of the
financial statement schedules listed in the accompanying index.  These financial
statement  schedules  are  the  responsibility of the Company's management.  Our
responsibility  is  to express an opinion on these financial statement schedules
based  upon  our  audits.

In  our  opinion,  such  financial  statement  schedules  present fairly, in all
material  respects,  the  information  set  forth  therein.

/s/  BDO  SEIDMAN,  LLP

BDO  SEIDMAN,  LLP
Grand  Rapids,  Michigan
May  9,  2003

GORAN  CAPITAL  INC.-  CONSOLIDATED
SCHEDULE I - SUMMARY OF INVESTMENTS - OTHER THAN INVESTMENTS IN RELATED PARTIES.

The  information  required  by  this  schedule is included in note 3 of Notes to
Consolidated  Financial  Statement.
<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.
SCHEDULE  II  -  CONDENSED  FINANCIAL  INFORMATION  OF  REGISTRANT
As  Of  December  31,  2002  and  2001
(in  thousands,  except  share  data)
                                                    2002       2001
                                                  ---------  ---------
<S>                                               <C>        <C>
Assets:
Cash and Short-term Investments. . . . . . . . .  $    178   $  2,618
Loans to Related Parties . . . . . . . . . . . .         -        219
Capital and Other Assets . . . . . . . . . . . .        29        531
Investment in Subsidiaries, at Cost. . . . . . .    10,437     10,639
                                                  ---------  ---------
Total Assets . . . . . . . . . . . . . . . . . .    10,644     14,007
                                                  =========  =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Loans from Related Parties and Other Liabilities  $  8,325   $ 10,800
                                                  ---------  ---------
Total Liabilities. . . . . . . . . . . . . . . .     8,325     10,800
                                                  ---------  ---------

Stockholders' Equity:
Common Shares. . . . . . . . . . . . . . . . . .    18,561     18,502
Cumulative Translation Adjustment. . . . . . . .       545        570
Deficit. . . . . . . . . . . . . . . . . . . . .   (16,787)   (15,865)
                                                  ---------  ---------
Total Stockholders' Equity . . . . . . . . . . .     2,319      3,207
                                                  ---------  ---------
Total Liabilities and Stockholders' Equity . . .  $ 10,644   $ 14,007
                                                  =========  =========
</TABLE>

<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.
SCHEDULE  II  -  CONDENSED  FINANCIAL  INFORMATION
OF  REGISTRANT
STATEMENT  OF  EARNINGS  (LOSS)  AND  ACCUMULATED  DEFICIT
For  The  Years  Ended  December  31,  2002,  2001  and  2000
(in  thousands)
                                                           2002       2001       2000
                                                         ---------  ---------  ---------
<S>                                                      <C>        <C>        <C>
Revenues
Management Fees . . . . . . . . . . . . . . . . . . . .  $     --   $     --   $     --
Net Investment Income . . . . . . . . . . . . . . . . .        29        173          5
Non-Compete Fee Income. . . . . . . . . . . . . . . . .     1,500        875         --
                                                         ---------  ---------  ---------
Total Revenues. . . . . . . . . . . . . . . . . . . . .     1,529      1,048          5
                                                         ---------  ---------  ---------
Expenses:
General, Administrative, Acquisition Expenses and Taxes     2,451      6,235      1,257
                                                         ---------  ---------  ---------
Total Expenses. . . . . . . . . . . . . . . . . . . . .     2,451      6,235      1,257
                                                         ---------  ---------  ---------
Net Loss. . . . . . . . . . . . . . . . . . . . . . . .      (922)    (5,187)    (1,252)
Deficit, Beginning of Year. . . . . . . . . . . . . . .   (15,865)   (10,678)    (9,426)
                                                         ---------  ---------  ---------
Deficit End of Year . . . . . . . . . . . . . . . . . .  $(16,787)  $(15,865)  $(10,678)
                                                         =========  =========  =========
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.
SCHEDULE  II  -  CONDENSED  FINANCIAL  INFORMATION  OF  REGISTRANT
For  The  Years  Ended  December  31,  2002,  2001  and  2000
(in  thousands)
                                              2002      2001      2000
                                            --------  --------  --------
<S>                                         <C>       <C>       <C>
Cash Flows from Operations
Net Loss . . . . . . . . . . . . . . . . .  $  (922)  $(5,187)  $(1,252)
Adjustments:
Foreign Exchange Losses. . . . . . . . . .     (118)     (165)       --
Non-Compete Agreement Receipts . . . . . .   (1,500)    4,622        --
Items Not Involving Cash:
Decrease (Increase) in Accounts Receivable     (580)    3,987      (975)
      Decrease (Increase) in Other Assets.        3      (449)     (485)
Increase (Decrease) in Accounts Payable. .     (240)    1,165     2,970
Translation Adjustment . . . . . . . . . .      (25)     (503)      (89)
                                            --------  --------  --------
Net Cash Provided (Used) by Operations . .   (3,382)    3,470       169
                                            --------  --------  --------
Cash Flows From Financing Activities:
Purchase of Investments. . . . . . . . . .   (1,130)     (218)     (185)
Sale of Investments. . . . . . . . . . . .    2,072      (831)       --
                                            --------  --------  --------
Net Cash Provided by Financing Activities.      942    (1,049)     (185)
                                            --------  --------  --------
Net Increase (Decrease) in Cash. . . . . .   (2,440)    2,421       (16)
Cash at Beginning of Year. . . . . . . . .    2,618       197       213
                                            --------  --------  --------
Cash at End of Year. . . . . . . . . . . .      178     2,618   $   197
                                            ========  ========  ========
Cash Resources are Comprised of:
Cash . . . . . . . . . . . . . . . . . . .  $   171   $    34   $    56
Short-Term Investments . . . . . . . . . .        7     2,584       141
                                            --------  --------  --------
                                            $   178   $ 2,618   $   197
                                            ========  ========  ========
</TABLE>


Basis  of  Presentation
The  condensed  financial  information  should  be  read in conjunction with the
consolidated financial statements of Goran Capital Inc.  The condensed financial
information  includes  the  accounts  and activities of the parent company which
acts  as  the  holding  company  for  the  insurance  subsidiaries.

<PAGE>
<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.-  CONSOLIDATED
SCHEDULE  IV  -  REINSURANCE
For  The  Years  Ended  December  31,  2002,  2001  and  1999
(in  thousands)

Property and Liability Insurance       2002        2001       1999
                                     ---------  ----------  ---------
<S>                                  <C>        <C>         <C>

Direct Amount . . . . . . . . . . .  $107,775   $ 161,092   $168,626
                                     ---------  ----------  ---------
Assumed From Other Companies. . . .     3,619      32,094     13,473
                                     ---------  ----------  ---------
Ceded to Other Companies. . . . . .   (77,403)   (106,324)   (78,637)
                                     ---------  ----------  ---------
Net Amounts . . . . . . . . . . . .  $ 33,991   $  86,862   $103,462
                                     =========  ==========  =========
Percentage of Amount Assumed to Net      10.6%       36.9%      13.0%
                                     ---------  ----------  ---------
</TABLE>


<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.-  CONSOLIDATED
SCHEDULE  V  -  VALUATION  AND  QUALIFYING  ACCOUNTS
For  The  Years  Ended  December  31,  1999,  2001  and  2002
(in  thousands)

                                          2002              2001               1999
                                    Allowance  for     Allowance  for      Allowance  for
                                  Doubtful Accounts   Doubtful Accounts   Doubtful Accounts
                                  ------------------  ------------------  ------------------
<S>                                         <C>             <C>                 <C>
Additions:

Balance at Beginning of Period          $1,526              $1,940              $1,479

Charged to Costs and Expenses(1)        1,448               6,122               9,623

Charged to Other Accounts                 -                   -                   -

Deductions from Reserves                2,730               6,536               9,162
                                  ------------------  ------------------  ------------------

Balance at End of Period                 $244               $1,526              $1,940
                                  ==================  ==================  ==================
<FN>


(1)     The Company continually monitors the adequacy of its allowance for doubtful accounts
and believes the balance of such allowance at December 31, 2002, 2001 and 1999 was adequate.
</TABLE>


<PAGE>
<TABLE>
<CAPTION>
GORAN  CAPITAL  INC.-  CONSOLIDATED
SCHEDULE  VI  -  SUPPLEMENTAL  INFORMATION  CONCERNING
PROPERTY  -  CASUALTY  INSURANCE  OPERATIONS
For  The  Years  Ended  December  31,  2002,  2001  and  1999
(in  thousands)

CONSOLIDATED  PROPERTY  -  CASUALTY  ENTITIES

                   Reserves
                   For
                   Unpaid                                                    Amorti-
                   Claims                                                    zation of
        Deferred    And                                                       Deferred   Paid Claims
         Policy    Claim                          Net        Claims and       Policy     and Claim
        Acquisi-   Adjust-                       Invest  Adjustment Expenses  Acqui-     Adjust-
          tion      ment    Unearned   Earned     ment        Incurred        sition     Ment        Premium
Year      Costs   Expense   Premiums   Premiums  Income      Related to:      Costs      Expense      Written
---- ---------------------------------------------------------------------------------------------------------------
<S>       <C>      <C>         <C>       <C>      <C>       <C>                <C>        <C>           <C>
                                                           Current   Prior
                                                            Years    Years
                                                           -------   ------
2000      6,454  113,149    62,386    145,532    12,171    132,781  (19,013)  37,453    174,412     182,099
2001        763   84,876    59,216    108,197     6,998     94,556      660   33,747    132,599     193,186
2002        -     72,809    35,797     41,037     4,388     38,497   13,016   19,624     57,893     111,394
<FN>

Note:  All  amounts in the above table are net of the effects of reinsurance and
related  commission  income,  except  for  net investment income regarding which
reinsurance  is not applicable, premiums written, reserves for unpaid claims and
claim adjustment expense and unearned premiums which are stated on a gross basis
</TABLE>


SIGNATURES
Pursuant  to  the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended, the Registrant has duly caused this report to be signed
on  its  behalf  by  the  undersigned,  thereto  duly  authorized.

GORAN  CAPITAL  INC.


                              ____________________________
June  3,  2003           By:  /s/  Douglas  H.  Symons
                              Chief  Executive  Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on June 3, 2003, on behalf of the
Registrant  in  the  capacities  indicated:

(1)  Principal  Executive  Officer:



____________________
/s/  Douglas  H.  Symons
Chief  Executive  Officer

(2)  Principal  Financial  Officer:



____________________
/s/  John  G.  Pendl
Chief  Financial  Officer,
Principal  Accounting  Officer


(3)  The  Board  of  Directors:



____________________          ____________________          ____________________
/s/  G.  Gordon  Symons          /s/  J.  Ross  Schofield          /s/  John  K.
McKeating
Chairman  of  the  Board          Director                    Director



____________________          ____________________
/s/  Ron  L.  Foxcroft          /s/  David  B.  Shapira
Director                    Director



____________________          __________________
/s/  Douglas  H.  Symons          /s/  Robert  C.  Whiting
Director                    Director

<PAGE>
                               GORAN CAPITAL INC.
    CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


CERTIFICATION

I,  Douglas  H.  Symons,  certify  that:

1.   I  have  reviewed  this  annual  report  on Form 10-K of Goran Capital Inc.

2.   Based  on  my  knowledge,  this  annual  report does not contain any untrue
     statement  of a material fact or omit to state a material fact necessary to
     make  the  statements  made, in light of the circumstances under which such
     statements  were made, not misleading with respect to the period covered by
     this  annual  report.

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included in this annual report, fairly present in all material
     respects  the  financial condition, results of operations and cash flows of
     the  Company  as  of, and for, the periods presented in this annual report.

4.   The  Company's  other  certifying  officer  and  I  are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in  Exchange  Act  Rules  13a-14  and 15d-14) for the Company, and we have:

     a)   designed  such  disclosure  controls  and  procedures  to  ensure that
          material  information  relating  to  the  registrant,  including  its
          consolidated  subsidiaries, is made known to us by others within those
          entities,  particularly  during the period in which this annual report
          is  being  prepared;

     b)   evaluated  the  effectiveness of the Company's disclosure controls and
          procedures  as  of  a  date within 90 days prior to the filing date of
          this  annual  report  (the  "Evaluation  Date");  and

     c)   presented  in  this  annual  report  our  conclusions  about  the
          effectiveness  of  the disclosure controls and procedures based on our
          evaluation  as  of  the  Evaluation  Date;

5.   The  Company's  other certifying officer and I have disclosed, based on our
     most  recent  evaluation, to the Company's auditors and the audit committee
     of  the  Company's board of directors (or persons performing the equivalent
     functions):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls which could adversely affect the Company's ability to record,
          process,  summarize  and report financial data and have identified for
          the  Company's  auditors any material weaknesses in internal controls;
          and

     b)   any  fraud, whether or not material, that involves management or other
          employees  who  have  a  significant  role  in  the Company's internal
          controls;  and

6.   The  Company's other certifying officer and I have indicated in this annual
     report  whether  or not there were significant changes in internal controls
     or  in  other  factors  that  could  significantly affect internal controls
     subsequent  to  the  date  of  our  most  recent  evaluation, including any
     corrective  actions  with  regard  to significant deficiencies and material
     weaknesses.


Dated:  June  3,  2003                         By:  /s/  Douglas  H.  Symons
        --------------                              ------------------------
                                                    Douglas  H.  Symons
                                                   Chief  Executive  Officer


<PAGE>
                               GORAN CAPITAL INC.
    CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


CERTIFICATION

I,  John  G.  Pendl,  certify  that:

1.   I  have  reviewed  this  annual  report  on Form 10-K of Goran Capital Inc.

2.   Based  on  my  knowledge,  this  annual  report does not contain any untrue
     statement  of a material fact or omit to state a material fact necessary to
     make  the  statements  made, in light of the circumstances under which such
     statements  were made, not misleading with respect to the period covered by
     this  annual  report.

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included in this annual report, fairly present in all material
     respects  the  financial condition, results of operations and cash flows of
     the  Company  as  of, and for, the periods presented in this annual report.

4.   The  Company's  other  certifying  officer  and  I  are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in  Exchange  Act  Rules  13a-14  and 15d-14) for the Company, and we have:

     a)   designed  such  disclosure  controls  and  procedures  to  ensure that
          material  information  relating  to  the  registrant,  including  its
          consolidated  subsidiaries, is made known to us by others within those
          entities,  particularly  during the period in which this annual report
          is  being  prepared;

     b)   evaluated  the  effectiveness of the Company's disclosure controls and
          procedures  as  of  a  date within 90 days prior to the filing date of
          this  annual  report  (the  "Evaluation  Date");  and

     c)   presented  in  this  annual  report  our  conclusions  about  the
          effectiveness  of  the disclosure controls and procedures based on our
          evaluation  as  of  the  Evaluation  Date;

5.   The  Company's  other certifying officer and I have disclosed, based on our
     most  recent  evaluation, to the Company's auditors and the audit committee
     of  the  Company's board of directors (or persons performing the equivalent
     functions):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls which could adversely affect the Company's ability to record,
          process,  summarize  and report financial data and have identified for
          the  Company's  auditors any material weaknesses in internal controls;
          and

     b)   any  fraud, whether or not material, that involves management or other
          employees  who  have  a  significant  role  in  the Company's internal
          controls;  and

6.   The  Company's other certifying officer and I have indicated in this annual
     report  whether  or not there were significant changes in internal controls
     or  in  other  factors  that  could  significantly affect internal controls
     subsequent  to  the  date  of  our  most  recent  evaluation, including any
     corrective  actions  with  regard  to significant deficiencies and material
     weaknesses.


Dated:  June  3,  2003                         By:  /s/  John  G.  Pendl
        --------------                              --------------------
                                                    John  G.  Pendl
                                               Chief  Financial  Officer