UNITED  STATES
SECURITIES  AND  EXCHANGE  COMMISSION
Washington,  D.C.  20549-1004

FORM  10-Q

Mark  One
[X]     QUARTERLY  REPORT  PURSUANT  TO  SECTION  13  OR  15  (d)
         OF  THE  SECURITIES  EXCHANGE  ACT  OF  1934

            FOR  THE  QUARTERLY  PERIOD  ENDED  JUNE  30,  2002

[ ]     TRANSITION REPORT PURSUANT TO SECTION 13OR  15(d)
         OF THE SECURITIES AND 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                            (I.R.S.  Employer
incorporation  or  organization)                            Identification  No.)


2  Eva  Road
Suite  200
Toronto,  Ontario  M9C  2A8

4720  Kingsway  Drive
Indianapolis,  Indiana  46205
(Address  of  Principal  Executive  Offices)

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

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

As  of  July  31, 2002, there were 5,393,698 shares of Registrant's no par value
common  stock  issued  and  outstanding.

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<CAPTION>


FORM 10-Q INDEX
FOR THE QUARTER ENDED JUNE 30, 2002

                                                                             Page
                                                                           Number
<S>                      <C>                                                  <C>

PART  I     FINANCIAL  INFORMATION

Item  1     Financial  Statements

           Consolidated  Balance  Sheets at June 30, 2002
           (unaudited) and December 31,2001                                     3

           Unaudited  Consolidated Statements of Operations
           for the Three Months Ended
           June  30,  2002  and  2001                                           4

           Unaudited  Consolidated  Statements  of Operations
           for the Six Months Ended
           June  30,  2002  and  2001                                           5

           Unaudited  Consolidated Statement of Stockholder's
           Equity (Deficit) for the Six  Months  ended
           June  30,  2002  and  2001                                           6

           Unaudited  Consolidated  Statements  of Cash Flows for the
           Six Months Ended June  30,  2002  and  2001                          7

           Condensed  Notes  to Unaudited Consolidated Financial
           Statements                                                           8

Item  2    Management's  Discussion  and  Analysis  of  Financial
           Condition and Results  of  Operations                               16

Item  3    Quantitative  and  Qualitative  Disclosures  about  Market  Risk    22

PART  II   OTHER  INFORMATION                                                  22

Item  1    Legal  Proceedings                                                  22

Item  2    Changes  in  Securities  and  Use  of  Proceeds                     23

Item  3    Defaults  Upon  Senior  Securities                                  23

Item  4    Submission  of  Matters  to  a  Vote of Security Holders            23

Item  5    Other  Information                                                  24

Item  6    Exhibits  and  Reports  on  Form  8-K                               24

SIGNATURES                                                                     25

CERTIFICATIONS                                                                 26

GORAN  CAPITAL  INC.,  Analysis  of  Loss  Per  Share                          27

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<TABLE>
<CAPTION>

PART  I  -  FINANCIAL  INFORMATION
ITEM  1.  FINANCIAL  STATEMENTS
GORAN  CAPITAL  INC.
CONSOLIDATED  BALANCE  SHEETS
(CANADIAN  GAAP,  stated  in  thousands  of  U.S.  dollars)

                                                                           June 30,
                                                                            2002     December 31,
                                                                         (Unaudited)     2001
                                                                          ---------    ---------
<S>                                                                          <C>          <C>
ASSETS:
Investments:
    Fixed maturities. . . . . . . . . . . . . . . . . . . . . . . . . . .  $  74,398   $  77,325
    Equity securities . . . . . . . . . . . . . . . . . . . . . . . . . .     15,356      21,610
    Short-term investments, at amortized cost, which approximates market.      5,540      13,266
    Other invested assets . . . . . . . . . . . . . . . . . . . . . . . .        695       1,594
                                                                           ----------  ----------
Total Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . .     95,989     113,795
Investments in and advances to related parties. . . . . . . . . . . . . .        222       1,130
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . .      6,934      11,263
Receivables, net of allowances of $216 and $1,526 . . . . . . . . . . . .     40,576      47,441
Reinsurance recoverable on paid and unpaid losses, net. . . . . . . . . .     33,824      29,284
Prepaid reinsurance premiums. . . . . . . . . . . . . . . . . . . . . . .     35,023      40,039
Deferred policy acquisition costs . . . . . . . . . . . . . . . . . . . .        777         763
Property and equipment, net of accumulated depreciation . . . . . . . . .      8,486       9,907
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .      2,214       4,376
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      2,514       2,421
Assets of discontinued operations . . . . . . . . . . . . . . . . . . . .     10,361     115,900
                                                                           ----------  ----------
TOTAL ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 236,920   $ 376,319
                                                                           ==========  ==========

LIABILITIES AND STOCKHOLDER'S DEFICIT:
LIABILITIES:
    Losses and loss adjustment expenses . . . . . . . . . . . . . . . . .  $  78,818   $  84,876
    Unearned premiums . . . . . . . . . . . . . . . . . . . . . . . . . .     50,487      59,216
    Reinsurance payables. . . . . . . . . . . . . . . . . . . . . . . . .     59,127      58,868
    Distributions payable on preferred securities . . . . . . . . . . . .     20,914      23,252
    Deferred Income . . . . . . . . . . . . . . . . . . . . . . . . . . .      5,750       7,250
    Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     18,653      21,563
    Liabilities of discontinued operations. . . . . . . . . . . . . . . .     10,361     115,900
                                                                           ----------  ----------
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . .    244,110     370,925
                                                                           ----------  ----------
MINORITY INTEREST:
Company-obligated mandatorily redeemable preferred stock of trust
Subsidiary holding solely parent debentures . . . . . . . . . . . . . . .     67,994      94,540
                                                                           ----------  ----------
STOCKHOLDERS' DEFICIT:
Common Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     18,502      18,502
Contributed surplus . . . . . . . . . . . . . . . . . . . . . . . . . . .     70,864      42,465
Cumulative translation adjustment . . . . . . . . . . . . . . . . . . . .       (847)       (763)
Retained (deficit). . . . . . . . . . . . . . . . . . . . . . . . . . . .   (163,703)   (149,350)
                                                                           ----------  ----------
TOTAL STOCKHOLDERS' (DEFICIT) . . . . . . . . . . . . . . . . . . . . . .    (75,184)    (89,146)
                                                                           ----------  ----------
TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT) . . . . . . . . . . . . . .  $ 236,920   $ 376,319
                                                                           ==========  ==========
<FN>

See  condensed  notes  to  consolidated  financial  statements.
</TABLE>

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<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.
UNAUDITED  CONSOLIDATED  STATEMENTS  OF  OPERATIONS
(CANADIAN  GAAP,  stated  in  thousands  of  U.S.  dollars,  except  per  share  data)

                                                                          Three Months Ended
                                                                               June 30,
                                                                          ------------------
                                                                             2002      2001
                                                                           --------  --------
<S>                                                                          <C>       <C>
Gross premiums written. . . . . . . . . . . . . . . . . . . . . . . . . .  $23,626   $49,950
Less ceded premiums . . . . . . . . . . . . . . . . . . . . . . . . . . .   15,970    22,248
                                                                           --------  --------
Net premiums written. . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 7,656   $27,702
                                                                           ========  ========

Net premiums earned . . . . . . . . . . . . . . . . . . . . . . . . . . .  $11,892   $26,411
Fee income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    2,176     3,444
Net investment income . . . . . . . . . . . . . . . . . . . . . . . . . .    1,401     1,712
Other Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      750       250
Net realized capital loss . . . . . . . . . . . . . . . . . . . . . . . .     (625)     (373)
                                                                           --------  --------
Total revenues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   15,594    31,444
                                                                           --------  --------
Expenses:
  Losses and loss adjustment expenses . . . . . . . . . . . . . . . . . .   13,356    21,890
  Policy acquisition and general and administrative expenses. . . . . . .    8,549    11,265
  Amortization of intangibles . . . . . . . . . . . . . . . . . . . . . .       43        13
                                                                           --------  --------
Total expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   21,948    33,168
                                                                           --------  --------
Loss from continuing operations before income taxes and minority interest   (6,354)   (1,724)
                                                                           --------  --------
Total income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . .        -         -
                                                                           --------  --------
Loss from continuing operations before minority interest. . . . . . . . .   (6,354)   (1,724)
Minority interest:
  Distributions on preferred securities, net of tax of $0 in both
  2002 and 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    2,032     2,216
                                                                           --------  --------
Loss from continuing operations . . . . . . . . . . . . . . . . . . . . .   (8,386)   (3,940)
                                                                           --------  --------
Discontinued operations:
  Income (loss) from operations of discontinued segment, less applicable
  income taxes of $0 in both 2002 and 2001. . . . . . . . . . . . . . . .        -    (2,156)
                                                                           --------  --------

Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $(8,386)  $(6,096)
                                                                           ========  ========
Weighted average shares outstanding - basic and fully diluted . . . . . .    5,394     5,776
                                                                           ========  ========
Net loss from continuing operations per share - basic and fully diluted .  $ (1.55)  $ (0.68)
                                                                           ========  ========
Net loss of discontinued operations per share - basic and fully diluted .  $  0.00   $ (0.37)
                                                                           ========  ========
Net loss per share - basic and fully diluted. . . . . . . . . . . . . . .  $ (1.55)  $ (1.05)
                                                                           ========  ========
<FN>

See  condensed  notes  to  consolidated  financial  statements.
</TABLE>


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<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.
UNAUDITED  CONSOLIDATED  STATEMENTS  OF  OPERATIONS
(CANADIAN  GAAP,  stated  in  thousands  of  U.S.  dollars,  except  per  share  data)

                                                                               Six Months Ended
                                                                                  June 30,
                                                                               ----------------
                                                                             2002       2001
                                                                           ---------  ---------
<S>                                                                           <C>        <C>
Gross premiums written. . . . . . . . . . . . . . . . . . . . . . . . . .  $ 68,708   $ 98,288
Less ceded premiums . . . . . . . . . . . . . . . . . . . . . . . . . . .    46,943     53,641
                                                                           ---------  ---------
Net premiums written. . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 21,765   $ 44,647
                                                                           =========  =========

Net premiums earned . . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 24,985   $ 45,255
Fee income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     4,990      6,406
Net investment income . . . . . . . . . . . . . . . . . . . . . . . . . .     2,739      3,521
Other Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     1,500        250
Net realized capital loss . . . . . . . . . . . . . . . . . . . . . . . .    (1,347)    (1,076)
                                                                           ---------  ---------
Total revenues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    32,867     54,356
                                                                           ---------  ---------
Expenses:
Losses and loss adjustment expenses . . . . . . . . . . . . . . . . . . .    27,304     39,635
Policy acquisition and general and administrative expenses. . . . . . . .    15,842     22,938
Amortization of intangibles . . . . . . . . . . . . . . . . . . . . . . .        86         59
                                                                           ---------  ---------
Total expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    43,232     62,632
                                                                           ---------  ---------
Loss from continuing operations before income taxes and minority interest   (10,365)    (8,276)
                                                                           ---------  ---------
Total income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . .         -          -
                                                                           ---------  ---------
Loss from continuing operations before minority interest. . . . . . . . .   (10,365)    (8,276)
Minority interest:
Distributions on preferred securities, net of tax of $0 in both
2002 and 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     3,988      5,211
                                                                           ---------  ---------
Loss from continuing operations . . . . . . . . . . . . . . . . . . . . .   (14,353)   (13,487)
                                                                           ---------  ---------
Discontinued operations:
Income (loss) from operations of discontinued segment, less applicable
income taxes of $0 in both 2002 and 2001. . . . . . . . . . . . . . . . .         -     (2,156)
                                                                           ---------  ---------

Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $(14,353)  $(15,643)
                                                                           =========  =========
Weighted average shares outstanding - basic and fully diluted . . . . . .     5,423      5,776
                                                                           =========  =========
Net loss from continuing operations per share - basic and fully diluted .  $  (2.65)  $  (2.34)
                                                                           =========  =========
Net loss of discontinued operations per share - basic and fully diluted .  $   0.00   $  (0.37)
                                                                           =========  =========
Net loss per share - basic and fully diluted. . . . . . . . . . . . . . .  $  (2.65)  $  (2.71)
                                                                           =========  =========
<FN>

See  condensed  notes  to  consolidated  financial  statements.
</TABLE>


<PAGE>


<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.
UNAUDITED  CONSOLIDATED  STATEMENTS  OF  STOCKHOLDERS'  EQUITY  (DEFICIT)
(CANADIAN  GAAP,  stated  in  thousands  of  U.S.  dollars)

                                                       Cumulative   Retained      Total
                                  Common  Contributed  Translation  Earnings   Stockholders'
                                  Stock   Surplus      Adjustment   (Deficit) Equity (Deficit
                                  -----    -------       ---------  --------  -------------
<S>                                <C>       <C>            <C>           <C>         <C>
Balance at December 31, 2000      $19,132   $23,748        $(291)   $(115,257)    $(72,668)

Purchase of Preferred Securities        -    17,980            -              -     17,980

Change in cumulative translation
Adjustment                              -         -          584              -        584
Net loss
                                        -         -            -      (15,643)     (15,643)
                                 --------   -------       -----     ----------     -------
Balance at June 30, 2001. . . . . $19,132   $41,728        $ 293    $(130,900)    $(69,747)
                                  =======  ========        =====    ==========     =======

Balance at December 31, 2001      $18,502   $42,465        $(763)   $(149,350)    $(89,146)

Purchase of Preferred Securities             28,399                                 28,399

Change in cumulative translation
Adjustment                              -         -          (84)           -          (84)
 Net loss                               -         -            -      (14,353)     (14,353)
                                   -------   --------       -----   ---------     --------
Balance at June 30, 2002          $18,502   $70,864        $(847)   $(163,703)    $(75,184)
                                  =======   =======        ======    ========     =========
<FN>

See condensed notes to consolidated financial statements.
</TABLE>

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<TABLE>
<CAPTION>

GORAN  CAPITAL  INC.
UNAUDITED  CONSOLIDATED  STATEMENTS  OF  CASH  FLOWS
(CANADIAN  GAAP,  stated  in  thousands  of  U.S.  dollars)

                                                                                    Six Months Ended
                                                                                       June  30,
                                                                                   2002       2001
                                                                                 ---------  ---------
<S>                                                                                 <C>        <C>
Cash flows from operating activities:
 Net loss for the period . . . . . . . . . . . . . . .  . . . . . . . . . . . .  $(14,353)  $(15,643)
  Adjustments to reconcile net loss to net cash provided by (used in) operations:
  Depreciation, amortization, impairment and other. . . . . . . . . . . . . . .     1,763      2,276
  Net realized capital loss . . . . . . . . . . . . . . . .   . . . . . . . . .     1,347      1,076
Net changes in operating assets and liabilities:
  Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     6,865    (15,018)
  Reinsurance recoverable on paid and unpaid losses . . . . . . . . . . . . . .    (4,540)     4,021
  Prepaid reinsurance premiums. . . . . . . . . . . . . . . . . . . . . . . . .     5,016    (11,429)
  Deferred policy acquisition costs . . . . . . . . . . . . . . . . . . . . . .       (14)       259
  Other assets and liabilities. . . . . . . . . . . . . . . . . . . . . . . . .    (3,003)    12,223
  Loss and loss adjustment expense reserves . . . . . . . . . . . . . . . . . .    (6,058)   (14,563)
  Unearned premiums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    (8,729)    11,120
  Reinsurance payables. . . . . . . . . . . . . . . . . . . . . . . . . . . . .       259      4,673
  Distribution payable on preferred securities. . . . . . . . . . . . . . . . .     1,592      2,203
  Deferred income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    (1,500)     8,750
  Net assets from discontinued operations . . . . . . . . . . . . . . . . . . .    (3,483)     1,602
                                                                                 ---------  ---------
Net cash (used in) operations . . . . . . . . . . . . . . . . . . . . . . . . .   (24,838)    (8,450)
                                                                                 ---------  ---------

Cash flows from investing activities, net of assets acquired:
  Net sale of short-term investments. . . . . . . . . . . . . . . . . . . . . .     7,726      1,731
  Proceeds from sales, calls and maturities of fixed maturities . . . . . . . .    19,437     27,045
  Purchase of fixed maturities . . . . . . . . . . . . . . . . . . .  . . . . .   (14,276)    (8,029)
  Proceeds from sale of equity securities . . . . . . . . . . . . . . . . . . .     8,447     16,953
  Purchase of equity securities . . . . . . . . . . . . . . . . . . . . . . . .    (3,427)   (14,277)
  Proceeds from repayment of mortgage loans . . . . . . . . . . . . . . . . . .         -      1,870
  Purchase of property and equipment. . . . . . . . . . . . . . . . . . . . . .      (272)    (1,577)
  Net investing activities from discontinued operations . . . . . . . . . . . .     3,912       (263)
  Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       878        (45)
                                                                                 ---------  ---------
Net cash provided by investing activities . . . . . . . . . . . . . . . . . . .    22,425     23,408
                                                                                 ---------  ---------

Cash flows from financing activities, net of assets acquired:
  Purchase of subsidiary's preferred securities . . . . . . . . . . . . . . . .    (2,395)    (1,896)
  Repayment of related party loans. . . . . . . . . . . . . . . . . . . . . . .       908        117
  Net financing activities from discontinued operations . . . . . . . . . . . .      (429)      (655)
                                                                                 ---------  ---------
Net cash provided by (used in) financing activities . . . . . . . . . . . . . .    (1,916)    (2,434)
                                                                                 ---------  ---------

Increase in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . .    (4,329)    12,524
Cash and cash equivalents, beginning of period. . . . . . . . . . . . . . . . .    11,263      3,230
                                                                                 ---------  ---------
Cash and cash equivalents, end of period. . . . . . . . . . . . . . . . . . . .     6,934   $ 15,754
                                                                                 =========  =========
<FN>

See  condensed  notes  to  consolidated  financial  statements.
</TABLE>

<PAGE>


                               GORAN CAPITAL INC.
            CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                     For the Six Months Ended June 30, 2002
1.     BASIS  OF  PRESENTATION
Goran  Capital  Inc. ("the Company") is the parent company of the Goran group of
companies.  The  consolidated  financial  statements  are prepared in accordance
with  Canadian  Generally  Accepted  Accounting  Principles.  In  addition,  the
consolidated  financial  statements  are  also  used  to  satisfy  the Company's
financial  filing  requirements  in  the  U.S.  Consequently,  the  consolidated
financial statements include disclosures that are not necessarily required under
Canadian  GAAP  and  contain  references to U.S. GAAP accounting pronouncements.
Note  8,  presents  a reconciliation of Canadian and U.S. GAAP. The consolidated
financial statements have been prepared pursuant to the rules and regulations of
the  Securities and Exchange Commission ("SEC").  In management's opinion, these
financial  statements  include  all  adjustments  (consisting  only  of  normal,
recurring  adjustments)  necessary  for  a  fair  presentation of the results of
operations  for  the  interim  periods  presented.  Pursuant  to  SEC  rules and
regulations,  certain  information and footnote disclosures normally included in
financial  statements  prepared in accordance with generally accepted accounting
principles  have  been  condensed  or  omitted  from  these  statements,  unless
significant  changes  have  taken  place since the end of the most recent fiscal
year.  For  this  reason, the accompanying consolidated financial statements and
notes  thereto  should  be read in conjunction with the financial statements and
notes for the year ended December 31, 2001 included in the Company's 2001 Annual
Report  on  Form  10-K.  Results  for  any  interim  period  are not necessarily
indicative  of  results  to  be  expected  for  the  year.

The  consolidated  financial statements include the accounts, after intercompany
eliminations,  of  the  Company  and  its  wholly owned subsidiaries as follows:

-    Granite  Reinsurance  Company Ltd. ("Granite Re") a finite risk reinsurance
     company  domiciled  in  Barbados.

-    Granite  Insurance  Company  ("Granite")  a  Canadian  federally  licensed
     insurance  company.

-    Symons  International  Group  (Florida)  Inc.  ("SIGF")  a Florida domestic
     corporation.

Symons  International  Group, Inc. ("SIG") is a 73.1% owned subsidiary of Goran.
SIG's  subsidiaries  are  as  follows:

-    Superior  Insurance  Group  Management, Inc ("Superior Group Management") a
     holding  company  for the nonstandard automobile operations which includes:
-    Superior  Insurance Group, Inc. ("Superior Group") a management company for
     the  nonstandard  automobile  operations;
-    Superior  Insurance  Company ("Superior") an insurance company domiciled in
     Florida;
-    Superior  American  Insurance  Company  ("Superior  American") an insurance
     company  domiciled  in  Florida;
-    Superior  Guaranty  Insurance  Company  ("Superior  Guaranty") an insurance
     company  domiciled  in  Florida;
-    Pafco General Insurance Company ("Pafco") an insurance company domiciled in
     Indiana;
-    IGF  Holdings,  Inc.  ("IGFH")  a  holding  company
-    IGF  Insurance  Company  ("IGF")  an insurance company domiciled in Indiana
     (See  Note  23);

As  previously  announced,  SIG sold its crop insurance operations to Acceptance
Insurance  Companies  Inc.  ("Acceptance")  on  June 6, 2001. The crop insurance
business was written through IGF, which is in runoff. Accordingly, the financial
statements  included  in  this  report reflect the results of the crop insurance
segment  as  "discontinued  operations."

2.     PREFERRED  SECURITIES
On  August  12,  1997,  SIG's  trust subsidiary issued $135 million in preferred
securities  (the  "Preferred  Securities") bearing interest at an annual rate of
9.5%. The principal assets of the trust subsidiary are senior subordinated notes
of  SIG  in  the  principal  amount  of  $135  million with an interest rate and
maturity  date  substantially  identical  to  those of the Preferred Securities.
Expenses of the issue aggregated $5.1 million and are amortized over the term of
the  Preferred  Securities.

The  Preferred  Securities  represent  company-obligated  mandatorily redeemable
securities  of  a  trust  subsidiary holding solely parent debentures and have a
term  of 30 years with semi-annual interest payments that commenced February 15,
1998.  SIG  may  redeem  the  Preferred  Securities in whole or in part after 10
years.  The  annual  Preferred Security obligations of approximately $13 million
must  be  funded  from  SIG's  nonstandard  automobile management company, which
receives  management  and  billing  fees from its insurance subsidiaries. In the
event  the  Company's  insurance company subsidiaries continue to reduce premium
volume,  reduced  management and billing fees will be payable to Superior Group,
which  would  result  in  less  funds  from which to fund the obligations of the
Preferred  Securities.  Under  the  terms  of the indenture, SIG is permitted to
defer  semi-annual  interest payments for up to five years. SIG elected to defer
the interest payments due in February and August 2000 and 2001 and February 2002
and  may  continue  this  practice  through January 2005. SIG plans to defer the
interest  payments  due  in  August  2002.

The  trust  indenture  for the Preferred Securities contains certain restrictive
covenants  including  covenants  based upon SIG's consolidated coverage ratio of
earnings  before  interest,  taxes, depreciation and amortization ("EBITDA"). If
SIG's  EBITDA  falls  below  2.5  times consolidated interest expense (including
Preferred  Security  distributions)  for  the  most  recent  four  quarters, the
following  restrictions  become  effective:

-    SIG  may  not  incur  additional  indebtedness  or  guarantee  additional
     indebtedness.
-    SIG  may  not  make  certain  restricted payments including making loans or
     advances  to  affiliates,  repurchasing common stock or paying dividends in
     excess  of  a  stated  limitation.
-    SIG  may  not increase its level of non-investment grade securities defined
     as  equities,  mortgage  loans,  real  estate,  real  estate  loans  and
     non-investment  grade  fixed  income  securities.

These  restrictions  currently  apply,  as SIG's consolidated coverage ratio was
(1.06)  at  June  30,  2002, and will continue to apply until SIG's consolidated
coverage  ratio  complies  with  the  terms  of  the trust indenture. SIG was in
compliance  with  these  additional  restrictions  as  of  June  30,  2002.

3.     REGULATORY  AFFAIRS
Pafco  and  IGF  are  domiciled in Indiana and prepare their statutory financial
statements  in  accordance  with accounting practices prescribed or permitted by
the  Indiana  Department  of  Insurance  ("IDOI").  While  neither Pafco nor IGF
currently  has surplus from which to pay dividends, statutory requirements place
limitations  on  the  amount of funds that can be remitted to SIG from Pafco and
IGF.  The  Indiana  statute  allows 10% of surplus in regard to policyholders or
100%  of  net  income,  whichever  is greater, to be paid as dividends only from
earned  surplus;  however,  the  consent  orders with the IDOI, described below,
prohibit  the  payment  of  any  dividends  by Pafco and IGF. Superior, Superior
American  and  Superior  Guaranty  are  domiciled  in  Florida and prepare their
statutory  financial  statements  in  accordance  with  accounting  practices
prescribed  or  permitted  by  the Florida Department of Insurance ("FDOI"). The
Florida  statute  also  contains  limitations  with  regard  to  the  payment of
dividends.  Superior  may  pay  dividends of up to 10% of surplus or 100% of net
income,  whichever  is  greater,  from  earned  surplus.  Prescribed  statutory
accounting  practices  include  a  variety  of  publications  of  the  National
Association  of  Insurance  Commissioners  ("NAIC"),  as  well  as  state  laws,
regulations, and general administrative rules. The NAIC adopted the Codification
of  Statutory  Accounting  Principles  guidance  ("Codification"), as the NAIC's
primary guidance on statutory accounting effective January 1, 2001. The IDOI and
FDOI  have  adopted  Codification.  Permitted  statutory  accounting  practices
encompass  all  accounting  practices  not  so  prescribed.

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 payment 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  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.

Pafco  has  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 also provide monthly financial information to the departments
of  insurance  in  certain  states  in  which they write business, and Pafco has
agreed  to  obtain IDOI prior approval of any new affiliated party transactions.

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 SIG. On August 30,
2001,  the  FDOI rejected the recommended order and issued its final order which
SIG  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, which is pending. 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 Appeals, which
was  denied pending a ruling from the FDOI.  On April 5, 2002 the FDOI granted a
stay  of  the final order which is 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  is  unwilling to agree to the conditions imposed by the
FDOI's  conditional  stay.  On  May  6,  2002  Superior  filed a motion with the
district  court  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 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.

In  1999,  Superior ceased writing business in Illinois and agreed to obtain the
approval  of  the  Illinois  Department  of  Insurance  prior to writing any new
business  in  Illinois.  In  July  2001,  Superior agreed with the Department of
Insurance  in Texas to obtain its prior approval before writing any new business
in  that  state.

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.
The  nonstandard  automobile  insurance policies written in Virginia by Superior
accounted  for  approximately  13.1%  of the total gross written premiums of the
Company  in  2001.

SIG's  operating subsidiaries, their business operations, and their transactions
with  affiliates, including the Company, are subject to regulation and oversight
by the IDOI, the FDOI, and the insurance regulators of other states in which the
subsidiaries  write business. SIG is a holding company and all of its operations
are  conducted  by  its  subsidiaries.  Regulation  and  oversight  of insurance
companies and their transactions with affiliates is conducted by state insurance
regulators  primarily  for  the  protection  of  policyholders  and  not for the
protection of other creditors or of shareholders. Failure to resolve issues with
the  IDOI  and  the  FDOI  or  other  state  insurance  regulators in a mutually
satisfactory  manner  could  result  in future regulatory actions or proceedings
that  materially  and  adversely  affect  SIG  and  the  Company.

4.     COMMITMENTS  AND  CONTINGENCIES
As  previously  reported,  IGF  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  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 June 30, 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.  On  January 16, 2002, the court entered an order granting
IGF's  motion  for  judgment on the pleadings and required plaintiffs to show an
insurable  interest.  Plaintiffs amended their complaint attempting to allege an
insurable  interest,  and on March 19, 2002, the court granted IGF's demurrer to
the amended complaint. In granting the demurrer the court held that any recovery
payable to plaintiff would be limited to their actual economic losses regardless
of how much plaintiffs thought they had been promised (i.e. plaintiffs cannot be
paid  policy  limits  without regard to actual losses incurred).  The plaintiffs
then  filed  their  third  amended  complaint  to  which  MSI  filed  a demurrer
challenging  the  insurance  contract  allegations,  as  the  issuer of the AgPI
policies,  contending  that  plaintiffs failed to make the amendments to show an
insurable  interest  as  required by the court's previous rulings. This demurrer
was  granted,  without leave to amend, because the lack of an insurable interest
rendered  the contract an unenforceable wager agreement, as described in each of
the  various  versions  of  the  complaint.  Plaintiffs  have  now  moved  for
reconsideration  of  the  dismissal  of  the insurance claims asking for another
chance  to allege an adequate insurable interest. This hearing is set for August
13,  2002.  Discovery  is  proceeding.

As  previously  reported  in the Company's March 31, 2001 Form 10-Q, MSI and IGF
were  arbitrating  their  dispute  over  responsibility  for  claims paid to MSI
insureds.  Also as previously reported, an action was filed against the Company,
SIG, IGF, IGFH, Granite Re and certain affiliates of those companies, as well as
certain  members  of  the  Symons  family,  and  Acceptance in the United States
District  Court for the Southern District of Indiana which alleged that the June
6, 2001 sale of IGF's assets to Acceptance and the payments by Acceptance to the
Company, SIG and Granite Re violated Indiana law and were voidable.  The parties
have  settled  the arbitration and the Indiana action, and an order of dismissal
was  entered  by  the  court  on  June  26,  2002.

As  previously reported, SIG, IGFH and IGF, are 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 SIG, IGFH, IGF and CNA under the SAA are the subject of
an  action  pending in United States District Court for the Southern District of
Indiana,  Indianapolis  Division.  Claims  have also been asserted in the action
against  the  Company,  Granite  Re,  Pafco, Superior and certain members of the
Symons  family.  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. There have been no
material  developments  since last reported in the Company's March 31, 2002 Form
10-Q.

As  previously  reported, 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.  Discovery in the case is proceeding.  There
have  been  no  material developments since last reported in the Company's March
31,  2002  Form  10-Q.

As  previously  reported, an action has been brought in Florida against Superior
which  purports  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 alleges 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.  Superior  believes  that the allegations of wrongdoing as
alleged  in the complaint are without merit and intends to vigorously defend the
claims  brought against it.  There have been no material developments since last
reported  in  the  Company's  March  31,  2002  Form  10-Q.

As  previously  reported, an action has been brought in Florida against Superior
which  purports  to  be  brought  on  behalf of a class consisting of healthcare
providers that rendered treatment to and obtained a valid assignment of benefits
from Superior.  The plaintiff alleges that Superior reduced or denied claims for
medical  expenses  payable  to  the  plaintiff without first obtaining a written
report  in  violation  of Florida law.  The plaintiff also alleges that Superior
inappropriately  reduced  the  amount  of  benefits  payable to the plaintiff in
breach  of  Superior's  contractual  obligations  to  the  plaintiff.  Superior
believes the allegations of wrongdoing in violation of law are without merit and
intends  to vigorously defend the claims brought against it.  There have been no
material  developments  since last reported in the Company's March 31, 2002 Form
10-Q.

As  previously  reported, an action has been brought against Superior in Florida
by  a  purported  class  consisting  of  (i)  healthcare providers that rendered
treatment  to Superior insureds and claimants of Superior insureds and (ii) such
insureds  and  claimants. The plaintiff alleges that Superior improperly reduced
medical  benefits  payable  and  improperly  calculated interest in violation of
Florida  law.  Superior  believes  the  claim  is  without  merit and intends to
vigorously  defend  the charges brought against it.  There have been no material
developments  since  last  reported  in  the Company's March 31, 2002 Form 10-Q.

As  previously  reported,  actions have been brought in Florida against Superior
Guaranty  purporting  to be on behalf of a class of purchasers of insurance from
Superior  Guaranty  allegedly charged service or finance charges in violation of
Florida  law.  Superior  Guaranty believes that the allegations of wrongdoing as
alleged  in the complaint are without merit and intends to vigorously defend the
claims  brought against it.  There have been no material developments since last
reported  in  the  Company's  March  31,  2002  Form  10-Q.

SIG  is  a  50%  owner in a limited liability corporation ("LLC") established to
provide business services to the Company, SIG and an unrelated third party.  The
fair  market  value  of  the LLC's operating assets approximated its outstanding
debt  at  June  30,  2002.

The  Company  and  its  subsidiaries  are  named  as defendants in various other
lawsuits relating to their business.  Legal actions arise from claims made under
insurance  policies  issued  by  the  Company's  subsidiaries.  The  Company, in
establishing  its  loss  reserves, has considered these actions. There can be no
assurance  that  the  ultimate  disposition  of  these lawsuits will not have an
adverse  material  affect  the  Company's  operations  or  financial  position.

5.     LOSS  DEVELOPMENT  ON  PRIOR  ACCIDENT  YEARS
During  the  three  months  ended  June  30,  2002  SIG  experienced unfavorable
development  on  its  year-end  2001 loss and LAE reserves in the amount of $3.2
million.  This  was  the  result of unfavorable settlement of outstanding claims
due  primarily to abnormally high loss frequency.  This increased SIG's loss and
LAE  ratio  for  the  quarter  by  32.3 percentage points. SIG believes the high
frequency of loss is due to increased motor vehicle traffic as policyholders opt
to  drive,  rather  than  fly, to their destinations following the September 11,
2001  terrorist  attacks.

6.     RECLASSIFICATIONS
Certain  prior  period  amounts have been reclassified to conform to the current
year  presentation.

7.     LOSS  PER  SHARE
<TABLE>
<CAPTION>

Basic  and  diluted  net  loss  per  share  is  computed by dividing net loss as
reported  by  the  average  number  of  shares  outstanding  as  follows:

                                        Three Months Ended    Six Months Ended
(in  thousands)                                 June  30        June  30
                                              2002   2001      2002   2001
                                              -----  -----     -----  -----
<S>                                           <C>    <C>       <C>    <C>
Basic:
  Weighted-average common shares outstanding  5,394  5,776     5,423  5,776
                                              =====  =====     =====  =====

Diluted:
  Weighted-average common shares outstanding  5,394  5,776     5,423  5,776
                                              =====  =====     =====  =====
</TABLE>

The  Company  has 434,617 stock options outstanding as of June 30, 2002.  Common
stock equivalents are anti-dilutive.  Therefore, fully diluted loss per share is
the  same  as  basic  loss  per  share.

8.     UNITED  STATES  ACCOUNTING  PRINCIPLES
These  unaudited  consolidated  financial  statements  have  been  prepared  in
accordance  with  Canadian (CDN) GAAP. There are no differences between CDN GAAP
and  US  GAAP for both the net loss and the net loss per share.  The differences
between  CDN  GAAP  and  US  GAAP for stockholders' (deficit) are as follows (in
thousands):

<TABLE>
<CAPTION>

(in thousands)                                          June 30, 2002     December 31, 2001
                                                       ---------------    -----------------
<S>                                                             <C>                  <C>
Stockholders (deficit) in accordance with
Canadian GAAP . . . . . . . . . . . . . . . . . . . .  $      (75,184)       $     (89,146)

Add (deduct) effect of difference in accounting for:
     Receivable from sale of capital stock. . . . . .          (1,258)              (1,258)
     Unrealized gain (loss) on investments. . . . . .          (3,983)              (2,246)
                                                       ---------------  -------------------
Stockholders' (deficit) in accordance with
US GAAP . . . . . . . . . . . . . . . . . . . . . . .  $      (80,425)       $     (92,650)
                                                       ===============       ==============
</TABLE>

9.     DISCONTINUED  OPERATIONS
In  December  2000, SIG initiated the divestiture of its crop insurance segment.
This  business  was  predominantly  written  through  IGF.  The  transaction was
completed  in  June  2001  and transferred ownership of substantially all of the
crop  insurance  assets  of  SIG and IGF, effective with the 2001 crop cycle, to
Acceptance.  Upon  completion  of  the  sale, the net assets of the discontinued
operations  were  reduced to zero. IGF and its affiliates received approximately
$27.4  million  at  closing  and  Acceptance  assumed  all of the crop insurance
in-force  policies  for  the 2001 crop year.  For agreeing not to compete in the
crop  insurance  industry for a period of three years from the date of sale, the
Company and SIG each received $4.5 million at closing that is being amortized to
income  on a straight-line basis over three years. An additional $9.0 million in
reinsurance  premium  is  payable by Acceptance to Granite Re under a multi-year
reinsurance  treaty  whereby  Granite Re has agreed to reinsure a portion of the
crop insurance business of Acceptance and provide an indemnity on behalf of IGF.
The  results  of the crop insurance segment have been reflected as "Discontinued
Operations"  in  the accompanying unaudited consolidated financial statements in
accordance  with  Accounting  Principles  Board  Opinion  No.  30 "Reporting the
Results  of  Operations  --- Reporting the Effects of Disposal of a Segment of a
Business,  and  Extraordinary,  Unusual  and  Infrequently  Occurring Events and
Transactions."

<PAGE>

Summarized  results  of  operations for discontinued operations were as follows:

<TABLE>
<CAPTION>

  STATEMENTS  OF  OPERATIONS:
  (in  thousands)
                                                           Three Months Ended
                                                                  June  30
                                                              ---------------
                                                              2002     2001
                                                             ------  --------
<S>                                                            <C>     <C>
Gross premiums written. . . . . . . . . . . . . . . . . . .  $ 192   $88,569
                                                             ======  ========
Net premiums written. . . . . . . . . . . . . . . . . . . .  $  (2)  $(7,906)
                                                             ======  ========

  Net premiums earned . . . . . . . . . . . . . . . . . . .  $  (2)  $(2,816)
  Net investment and fee income . . . . . . . . . . . . . .    294     1,251
  Net realized capital gain (loss). . . . . . . . . . . . .     44       629
                                                             ------  --------
Total revenues. . . . . . . . . . . . . . . . . . . . . . .    336      (936)
                                                             ------  --------

  Loss and loss adjustment expenses . . . . . . . . . . . . . (175)      913
  Policy acquisition and general and administrative expenses.  511     1,901
  Interest and amortization expense . . . . . . . . . . . . .    -    (1,594)
                                                             ------  --------
Total expenses. . . . . . . . . . . . . . . . . . . . . . .    336     1,220
                                                             ------  --------

Earnings before income taxes. . . . . . . . . . . . . . . .      -    (2,156)

Income tax expense. . . . . . . . . . . . . . . . . . . . .      -         -
                                                             ------  --------

Net earnings from discontinued operations . . . . . . . . .  $   -   $(2,156)
                                                             ======   ======

</TABLE>


<TABLE>
<CAPTION>

  STATEMENTS  OF  OPERATIONS:
  (in  thousands)
                                                             Six Months Ended
                                                                  June  30
                                                             -----------------
                                                              2002     2001
                                                             ------  --------
<S>                                                            <C>     <C>
Gross premiums written. . . . . . . . . . . . . . . . . . .  $ 192   $182,569
                                                             ======  =========
Net premiums written. . . . . . . . . . . . . . . . . . . .  $   -   $    (18)
                                                             ======  =========

  Net premiums earned . . . . . . . . . . . . . . . . . . .  $   -   $    (18)
  Net investment and fee income . . . . . . . . . . . . . .    483        935
  Net realized capital gain (loss). . . . . . . . . . . . .    (79)       631
                                                             ------  ---------
Total revenues. . . . . . . . . . . . . . . . . . . . . . .    404      1,548
                                                             ------  ---------

  Loss and loss adjustment expenses . . . . . . . . . . . .   (193)     6,783
  Policy acquisition and general and administrative expenses.  597     (1,722)
  Interest and amortization expense . . . . . . . . . . . .      -     (1,357)
                                                             ------  ---------
Total expenses. . . . . . . . . . . . . . . . . . . . . . .    404      3,704
                                                             ------  ---------

Earnings before income taxes. . . . . . . . . . . . . . . .      -     (2,156)

Income tax expense. . . . . . . . . . . . . . . . . . . . .      -          -
                                                             ------  ---------

Net earnings from discontinued operations . . . . . . . . .  $   -   $ (2,156)
                                                             ======  =========
</TABLE>

<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS

FORWARD  LOOKING  STATEMENTS  AND  CERTAIN  RISKS
All  statements,  trend analyses, and other information contained in this report
relative  to  markets  for the Company's products and/or trends in the Company's
operations or financial results, as well as other statements which include words
such  as  "anticipate,"  "could,"  "feel(s),"  "believes,"  "plan,"  "estimate,"
"expect,"  "should," "intend," "will," and other similar expressions, constitute
forward-looking statements under the Private Securities Litigation Reform Act of
1995.  These  forward-looking statements 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,  among  other  things:  (i)  the  effect on customers, agents,
employees  and  others  due to SIG's receipt of a going concern opinion from its
independent  auditor;  (ii)  general  economic  conditions, including prevailing
interest  rate  levels and stock market performance; (iii) factors affecting the
Company's  nonstandard  automobile  operations  such  as rate increase approval,
policy  renewals,  new  business  written,  and premium volume; (iv) the factors
described  in this section and elsewhere in this report; and (v) adverse actions
by  insurance  regulatory  officials.

OVERVIEW  OF  THE  COMPANY
Goran  Capital,  Inc.  ("the Company") owns 73.1% of Symons International Group,
Inc.  ("SIG").  SIG  owns  insurance  companies  that  underwrite  and  market
nonstandard  private  passenger automobile insurance.  SIG's principal insurance
company  subsidiaries are Pafco General Insurance Company ("Pafco") and Superior
Insurance  Company  ("Superior"). Additionally, the Company owns 100% of Granite
Reinsurance  Company  Ltd. ("Granite Re"), Granite Insurance Company ("Granite")
and  Symons  International  Group  (Florida)  Inc.  ("SIGF").

Pafco, Superior and Superior's subsidiaries, 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 for nonstandard risks.  Nonstandard risk
insureds  are  those  individuals  who  are  unable to obtain insurance coverage
through  standard  market  carriers  due to factors such as poor premium payment
history,  driving  experience  or  violations,  particular occupation or type of
vehicle.  SIG  offers  several  different  policies  that  are  directed towards
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 the
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 lower rates 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.

As  previously  announced,  SIG sold its crop insurance operations to Acceptance
Insurance  Companies  Inc.  ("Acceptance")  on  June 6, 2001. The crop insurance
business  was  written  through  SIG's  subsidiary, IGF Insurance Company (IGF),
which  is  in  runoff.  Accordingly,  the  financial statements included in this
report  reflect  the  results  of  the  crop  insurance segment as "discontinued
operations."

Granite  Re  is  a  finite  risk  reinsurance  company  based  in  Barbados.

Granite  is  a Canadian federally licensed insurance company that ceased writing
new  insurance  policies  on  January  1,  1990.

SIGF  is  a  Florida  domestic corporation engaged in several lines of business,
including  a  property/casualty  insurance  brokerage  and  a  flood  insurance
brokerage.

SIGNIFICANT  LOSSES  HAVE  BEEN  REPORTED  AND  ARE  LIKELY  TO  CONTINUE
The net loss from continuing operations for the three months ended June 30, 2002
was  $(8,386,000).  The net loss from continuing operations for the three months
ended  June  30,  2001 was $(6,096,000). The net loss from continuing operations
for  the  six  months  ended June 30, 2002 was $(14,353,000).  The net loss from
continuing  operations for the six months ended June 30, 2001 was $(15,643,000).
The net loss from continuing operations for the twelve months ended December 31,
2001  was $(31,937,000).  The net loss from continuing operations for the twelve
months  ended December 31, 2000 was $(63,224,000).  The net loss from continuing
operations  for  the  six  months ended June 30, 2002 exceeded the net loss from
continuing  operations  for  the six months ended June 30, 2001 primarily due to
significant  adverse  development  on year end 2001 loss and LAE reserves and on
new  business  generated in the first quarter of 2002.  Although the Company has
taken  a number of actions to address factors contributing to these past losses,
there  can  be  no  assurance  that  operating  losses  will  not  continue.

RECENT  AND FURTHER REGULATORY ACTIONS MAY ADVERSELY 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  Indiana  Department of Insurance
("IDOI"),  the  Florida  Department  of  Insurance  ("FDOI")  and  the insurance
regulators  of  other  states  in  which the U.S. 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 Note 3, "Regulatory
Affairs"  in  the Condensed Notes to the Consolidated Financial Statements). The
primary  purpose  of  insurance  regulation  is  the protection of policyholders
rather  than shareholders. Failure to resolve issues with the IDOI, the FDOI and
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 is involved in a number of
pending  legal  proceedings (see Part II, Item 1, "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 and/or its
subsidiaries,  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  results in continued expense irrespective of the
ultimate  outcome

THE  TERMS  OF THE TRUST PREFERRED SECURITIES MAY RESTRICT THE COMPANY'S ABILITY
TO  ACT

SIG  has issued, through a wholly owned trust subsidiary, $135 million aggregate
principal  amount  in  trust  originated  preferred  securities  (the "Preferred
Securities").  The  Preferred  Securities  have  a  term  of  30  years and bear
interest  at  an annual rate of 9.5%, paid semi-annually. The obligations of the
Preferred  Securities  are  funded  from  SIG's nonstandard automobile insurance
management  company.  SIG elected to defer the semi-annual interest payments due
in  February  and  August 2000 and 2001 and the payment due in February 2002 and
may  continue  to  defer  such  payments for up to an aggregate of five years as
permitted  by the indenture for the Preferred Securities. SIG plans to defer the
interest  payments  due  in  August  2002.  All of the deferred interest (if all
payments  due in 2002, 2003, and 2004 are deferred) of approximately $84 million
will  become  due and payable in February 2005.  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.

CASH  FLOW  CONSTRAINTS  TO SUPERIOR GROUP MAY ADVERSELY AFFECT SIG'S ABILITY TO
FUND OPERATIONS AND TO SERVICE THE OBLIGATIONS OF THE TRUST PREFERRED SECURITIES

Under  the  present  structure,  claims, agent commissions and premium taxes are
paid  directly  by  the insurance company subsidiaries. However, pursuant to the
terms of the management agreement Superior Group is responsible for all payroll,
facilities,  data processing, computer systems and other functions necessary for
the  operations of the Company and its subsidiaries. The insurance companies pay
for such services through management fees that are calculated as a percentage of
gross  written  premiums.  Therefore,  declines  in  written  premiums result in
reduced  cash  flow  to  Superior  Group.

As discussed in "ITEM 1- Business - Recent Developments" in the Company's annual
report on Form 10-K for 2001, SIG projected a material decrease in gross written
premiums  for  2002 from 2001 levels with a corresponding decrease in management
fees  payable  to  Superior Group. However, the decrease in written premiums for
the  three  months ended June 30, 2002 was significantly higher than what we had
originally  anticipated.  Unless  SIG  is  able  to increase written premiums or
reduce  expenses  to correspond with the reduced level of written premiums, cash
flow will be inadequate to fund operations, including servicing of the Preferred
Securities.  See,  "ITEM  2  - Management's Discussion and Analysis of Financial
Condition  and  Results  of  Operations  -  LIQUIDITY  AND  CAPITAL  RESOURCES."

There  can  be  no  assurance that current levels of reduced cash flows will not
have  a  material  adverse  affect  on  SIG's  financial  position,  results  of
operations  and  its  ability  to  meet  short  and  long-term  obligations.

REVIEW  OF  CONSOLIDATED  OPERATIONS

NET  LOSS
The  net  loss  for  the  three  months  ended June 30, 2002 was $(8,386,000) or
$(1.55)  per share (basic and diluted).  The net loss for the three months ended
June  30,  2001  was $(6,096,000) or $(1.05) per share (basic and diluted).  The
increased  loss  is  due  to  the  higher  loss  ratio  in 2002 versus 2001.  In
addition,  policy acquisition and general and administrative expenses were 71.9%
and  42.7% of earned premiums for the three months ended June 30, 2002 and 2001,
respectively,  due to SIG's inability to reduce expenses quickly enough to match
declining  revenue.  There  was no loss on discontinued operations for the three
months  ended  June  30, 2002. The loss on discontinued operations for the three
months  ended  June  30, 2001 was $(2,156,000).  Refer to Note 9., "Discontinued
Operations"  of  the  Condensed  Notes  to Consolidated Financial Statements for
additional  information.

GROSS  PREMIUMS  WRITTEN
Gross  premiums written decreased 52.7% for the three months ended June 30, 2002
compared  to the three months ended June 30, 2001.  The primary reasons for this
decline  in  volume are the withdrawal from certain competitive markets and more
stringent underwriting initiatives intended to increase profitability.  Refer to
"Liquidity  and  Capital  Resources"  for  additional volume-related disclosure.

NET  PREMIUMS  WRITTEN
Net  premiums  written represent the portion of premiums retained by the Company
after consideration for risk sharing through reinsurance contracts.  As a result
of  declines  in  surplus  in  the  Company's U.S. insurance subsidiaries and to
manage  overall risk retention, in 2000 SIG entered into a reinsurance agreement
to cede a portion of its gross written premiums to National Union Fire Insurance
Company  of  Pittsburgh,  PA, an unrelated third party. For the six months ended
June  30,  2002,  SIG  ceded  71.8%  of  its  gross  written  premiums.

NET  PREMIUMS  EARNED
Net premiums earned decreased 55.0% and 44.8% for the three and six months ended
June  30, 2002, respectively, as compared to the same periods in 2001.  Premiums
are  earned  ratably over the term of the underlying insurance contracts and the
reduction  in  net  premiums  earned  is  a  result  of the decreases in written
premiums  and  policies  in  force.

FEE  INCOME
Fee  income  is derived from installment billings and other services provided to
policyholders.  Fee  income  decreased  36.8%  and  22.1%  for the three and six
months  ended  June  30,  2002, respectively, as compared to the same periods in
2001.  The  decreases are attributable to the reduction in policies in force and
the  overall  decline  in  written  premium  in  the  second  quarter  of  2002.

NET  INVESTMENT  INCOME
Net investment income for the three and six months ended June 30, 2002 was 18.2%
and  22.2%  lower,  respectively,  than for the comparable periods in 2001.  The
decreases  reflect  the  decline  in invested assets during periods of declining
premiums  and the liquidation of investments to pay prior year losses settled in
2002.


<PAGE>
NET  REALIZED  CAPITAL  (LOSSES)
Net  realized  capital  (losses)  were  $(625,000)  and $(373,000) for the three
months ended June 30, 2002 and 2001, respectively. Net realized capital (losses)
were  $(1,347,000)  and  $(1,076,000) for the six months ended June 30, 2002 and
2001,  respectively.  Capital  losses  resulted  primarily  from  the  continued
liquidation  of  investments  to  fund  operations  and  claim  payments  under
unfavorable  market  conditions.

LOSSES  AND  LOSS  ADJUSTMENT  EXPENSES
The  loss  and loss adjustment expense (LAE) ratio for SIG for the three and six
months ended June 30, 2002, was 117.0% and 112.0%, respectively, of net premiums
earned  as compared to 107.7% for first quarter 2002 and to 91.5% for the entire
year  of  2001.  During  the  second quarter of 2002 SIG experienced unfavorable
development  on  its  loss  and LAE reserves for accidents occurring in 2001 and
prior.  This  raised  the  loss and LAE ratio for the quarter by 32.3 percentage
points.

POLICY  ACQUISITION  AND  GENERAL  AND  ADMINISTRATIVE  EXPENSES
Policy  acquisition  and general and administrative expenses were $8,549,000 and
$11,265,000  for  the  three  months ended June 30, 2002 and 2001, respectively.
Policy  acquisition and general and administrative expenses were $15,842,000 and
$22,938,000  for  the six months ended June 30, 2002 and 2001, respectively. The
decreases  reflect  the  decline in gross written premiums and overall operating
expense  reduction  initiatives.  As  a percentage of gross premiums earned, SIG
experienced  an increase in its operating expense ratio, net of fee income, from
31.1%  for  the  three  months ended June 30, 2001 to 51.0% for the three months
ended  June  30, 2002.  The increase in the expense ratio is the result of lower
net  earned  premium  in the three months ended June 30, 2002 as compared to the
three  months  ended  June  30,  2001.

INCOME  TAXES
At  June  30,  2002 the Company's net deferred tax assets were fully offset by a
100%  valuation  allowance  that resulted in no tax benefit for the three months
ended  June  30,  2002.  At  June 30, 2001 the Company's net deferred tax assets
were  fully offset by a 100% valuation allowance that resulted in no tax benefit
for  the  three  months  ended  June  30,  2001.

REVIEW  OF  CONSOLIDATED  FINANCIAL  CONDITION

CASH  AND  INVESTMENTS
Total  cash  and investments were $102,923,000 and $125,058,000 at June 30, 2002
and  December  31,  2001,  respectively.  The  decrease  results  from continued
liquidations  to  fund  claim  payments  and  operating  expenses in a period of
declining  premium  volume.

REINSURANCE  RECEIVABLES  AND  PAYABLES
SIG  negotiated  a  third-party  quota  share  reinsurance agreement that became
effective  January  1,  2000.  Under  the  quota share agreement, SIG may cede a
portion  of  its  non-standard  automobile insurance premiums and related losses
based  on  a  variable  percentage of up to 75% of Superior's and Pafco's earned
premiums.  SIG's  ceding  percentage  for  the  three months ended June 30, 2002
totaled  71.8%.  The  decrease  in the amount of premiums and losses ceded under
this  contract  directly affect reinsurance balances due and payable on the face
of  the  financial  statements.

RECEIVABLES
Receivables,  exclusive  of  the  allowance  for doubtful accounts, decreased by
$8,175,000,  or 16.7%, from December 31, 2001 to June 30, 2002. This decrease is
primarily  attributable  to a decrease in billable premiums due to lower written
premiums  in the three and six months ended June 30, 2002 compared to the fourth
quarter  of  2001.  The allowance for doubtful accounts decreased by $1,310,000,
or  85.8%,  from  December 31, 2001 to June 30, 2002, primarily due to the final
reconciliation  of  receivables  previously  maintained  on  a  legacy  policy
administration  system  that  is  no  longer  in  service.

LOSS  AND  LOSS  ADJUSTMENT  EXPENSE  RESERVES
Total  loss and LAE reserves decreased by $6,058,000, or 7.1%, from December 31,
2001  to June 30, 2002.  This decrease is consistent with SIG's declining volume
of  business.


<PAGE>
UNEARNED  PREMIUMS
Unearned  premiums  decreased by $8,729,000, or 14.7%, from December 31, 2001 to
June  30,  2002.  This  decrease  is consistent with the decrease in receivables
discussed  above.

DEFERRED  INCOME
In connection with the sale of the crop insurance book of business to Acceptance
on June 6, 2002, the Company and SIG each received a payment of $4.5 million for
agreeing  not  to engage in the crop insurance business for three years from the
sale  date.  The  payment  is being amortized to income on a straight-line basis
over  the  three-year  period.

STOCKHOLDERS'  (DEFICIT)
Stockholders'  (deficit) was $(75,184,000) and $(89,146,000) as of June 30, 2002
and December 31, 2001, respectively. This increase is the result of the net loss
of  $(14,353,000)  for the six months ended June 30, 2002, offset by an increase
in  combined surplus of $28,339,000 due primarily to the purchase by the Company
of  SIG's  Preferred  Securities.

LIQUIDITY  AND  CAPITAL  RESOURCES

The  primary  sources  of  funds  for  the  Company are dividends and loans from
Granite  Re.

The  primary  source  of  funds available to SIG are fees from policyholders and
management  fees  and  dividends  from  its  insurance  company  subsidiaries.

Superior  Insurance Group, Inc. ("Superior Group") collects billing fees charged
to  policyholders  who  elect  to  make  their premium payments in installments.
Superior Group also receives management fees under its management agreement with
its  insurance subsidiaries.  When the FDOI approved the acquisition of Superior
by  Superior  Group,  it  prohibited Superior from paying any dividends (whether
extraordinary  or not) for four years from the date of acquisition (May 1, 1996)
without  the  prior  written  approval of the FDOI, which restriction expired in
April 2000.  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.  Pafco  cannot pay extraordinary dividends, within the meaning of
the  Indiana Insurance Code, without the prior approval of the Indiana Insurance
Commissioner.  The  management  fees  charged  to  Pafco,  Superior  and IGF are
subject  to  review  by  the  IDOI  and  FDOI.

The  nonstandard automobile insurance subsidiaries' primary sources of funds are
premiums,  investment  income and proceeds from the maturity or sale of invested
assets.  Such  funds  are used principally for the payment of claims, payment of
claims  settlement  costs,  operating  expenses  (primarily  management  fees),
commissions  to independent agents, premium taxes, dividends and the purchase of
investments.  There  is  variability  in  cash outflows because of uncertainties
regarding  settlement dates for liabilities for unpaid losses.  Accordingly, SIG
maintains  investment programs intended to provide adequate funds to pay claims.
During  the  second  quarter  of  2002  and during 2001 and 2000, due to reduced
premium  volume, SIG has liquidated investments to pay claims.  SIG historically
has  tried to maintain duration averages of 3.5 years. However, the reduction in
new  funds  due  to  lower  premium volume has and will continue to cause SIG to
shorten  the  duration  of  its  investments.  SIG may incur additional costs in
selling  longer  bonds  to  pay  claims,  as  claim payments tend to lag premium
receipts.  Due to the decline in premium volume, SIG has experienced a reduction
in  its  investment  portfolio,  but  to  date  has not experienced any problems
meeting  its  obligations  for  claims  payments.

As  of  June  30, 2002, SIG has drawn all funds available under its $2.5 million
revolving  credit  facility  ("Facility")  with Granite Re, a related party. The
terms  of  the Facility call for monthly interest payments at the prime rate (as
printed in the Wall Street Journal on the first business day of each month) plus
5.25%  (the  total rate was 10.0% at August 1, 2002) computed on an annual basis
and  not to exceed 18% per annum calculated on the average principal outstanding
each  month.  All  principal  borrowed under the Facility is due on December 20,
2004.

On  August  12,  1997,  SIG  issued through a wholly owned trust subsidiary $135
million aggregate principal amount in trust originated preferred securities (the
"Preferred  Securities").  The Preferred Securities have a term of 30 years with
semi-annual  interest payments of $6.4 million that commenced February 15, 1998.
SIG may redeem the Preferred Securities in whole or in part after 10 years.  SIG
may  defer interest payments in accordance with the terms of the trust indenture
for a period of up to five years. The unpaid interest installment amounts accrue
interest at 9.5%. SIG deferred the semi-annual interest payments due in February
and  August  2000  and  2001  and  February  2002 and may continue this deferral
practice for all remaining payments due in 2002, 2003, and 2004.  SIG intends to
defer  the  interest  payments  due  in  August  2002.

The following table sets forth the minimum required obligations of SIG under the
Preferred  Securities  for  interest and principal payments for each of the next
four  years  and  thereafter  assuming  all semi-annual interest payments due in
2002,  2003,  and  2004  are  deferred  (in  thousands):

<TABLE>
<CAPTION>

                    2002   2003   2004    2005    Thereafter    Total
                    -----  -----  -----  -------  -----------  --------
<S>                 <C>    <C>    <C>      <C>         <C>        <C>
Interest payments.  $   -  $   -  $   -  $96,779  $   282,150  $378,929
Principal payments      -      -      -        -      135,000   135,000
                    -----  -----  -----  -------  -----------  --------
Total due. . . . .  $   -  $   -  $   -  $96,779  $   417,150  $513,929
                    =====  =====  =====  =======  ===========  ========

</TABLE>

The trust indenture contains certain restrictive covenants including those based
upon  SIG's  consolidated  coverage  ratio  of  earnings before interest, taxes,
depreciation  and  amortization  (EBITDA). If SIG's EBITDA falls below 2.5 times
consolidated interest expense (including Preferred Securities distributions) for
the  most  recent  four  quarters,  the following restrictions become effective:

-    SIG  may  not  incur  additional  indebtedness  or  guarantee  additional
     indebtedness.
-    SIG  may  not  make  certain  restricted payments including making loans or
     advances  to  affiliates,  repurchasing common stock or paying dividends in
     excess  of  a  stated  limitation.
-    SIG  may  not increase its level of non-investment grade securities defined
     as  equities,  mortgage  loans,  real  estate,  real  estate  loans  and
     non-investment  grade  fixed  income  securities.

These  restrictions  currently  apply,  as SIG's consolidated coverage ratio was
(1.06)  at  June  30,  2002, and will continue to apply until SIG's consolidated
coverage  ratio  complies  with  the  terms  of  the trust indenture. SIG was in
compliance  with  these  additional  restrictions  as  of  June  30,  2002.

Beginning  in the fourth quarter of 2001 and continuing in the second quarter of
2002,  SIG  experienced  adverse loss experience on a substantial portion of its
new  business written in certain markets. In late February and early March 2002,
SIG  commenced further analysis of loss ratios by individual agency and a review
of  claim  settlement procedures. Based on this and other analysis, SIG took the
following  actions  in  late  March  and  in April 2002 to improve its financial
position  and  operating  results:

-    Eliminated  reinstatements  in all markets, i.e., upon policy cancellation,
     the  insured  must  obtain  a  new  policy  at prevailing rates and current
     underwriting  guidelines;
-    Terminated  or  placed  on  new  business moratorium several hundred agents
     whose loss ratios were abnormally high when compared to the average for the
     remaining agents (these agents accounted for approximately 16% of the total
     gross  written  premium  in  2001);
-    Increased  underwriting  requirements  in certain markets including: higher
     down  payments,  new  policy  fees,  and  shorter  policy  terms;
-    Hired  a  consultant  with  significant  auto  claims  experience to review
     processes  and  suggest  modifications  to  the  claims  function.
As  previously reported in the Company's December 31, 2001 Annual Report on Form
10-K,  SIG expected the above actions to result in a decline of approximately 10
to  15%  in  gross  written  premiums  from 2001 levels. Based on actual results
through  June  2002,  SIG now expects a decline ranging from 30% to 35% in gross
written  premiums  for  calendar year 2002 from 2001 levels with a corresponding
decrease  in  management  fees  payable  to  Superior  Group. In April 2002, SIG
eliminated  approximately  60  full-time  positions, primarily in its claims and
underwriting departments, representing approximately 17% of its employees before
the  layoffs. In addition, SIG has undertaken other cost savings initiatives and
process  changes  in  order  to  reduce  operating  expenses.

Net  cash  used  by  operating  activities  in the first half of 2002 aggregated
$(24,838,000) compared to $(8,450,000) for the same period in 2001. The increase
is primarily due to SIG's lower premium volume in the first half of 2002 and the
receipt  in  2001 of $9.0 million for the non-compete agreement with Acceptance.
See  Note  8  "Discontinued  Operations" in the Condensed Notes to the Financial
Statements.

SIG's  present  projected  level  of  cash  flow from premium volume, investment
income  and  billing fees will be insufficient to fund its operating expenses at
their  present  levels  through  the end of 2002. SIG is considering alternative
sources  of  working capital which may be available in order to fund operations.
Among  the  alternate sources pursued by SIG are capital contributions and loans
from  the Company. In addition, SIG may continue to reduce operating expenses to
match  cash  inflows  and  may  increase  premium  volume in the third or fourth
quarters  in  certain states assuming the new business is written to generate an
underwriting  profit. In the event SIG's insurance company subsidiaries continue
to  reduce premium volume, the result will be continued reductions in management
and  billing fees paid to Superior Group which will reduce cash flow and sources
of  funds  available to fund operating expenses and other obligations, including
the  Preferred  Securities.

Shareholders'  equity  reflected a deficit of $(75.18) million at June 30, 2002,
which does not reflect the statutory surplus upon which the Company conducts its
U.S.  insurance  operations.  The  Company's  U.S.  insurance  subsidiaries, not
including  IGF,  after  the  effects  of  Codification, had statutory surplus of
approximately  $13.2  million  at  June  30,  2002.

Given  the  financial  position and loss experience of SIG over the past several
years  as  described  above,  SIG's independent auditors issued an opinion based
upon  their  audit  of SIG's December 31, 2001 Consolidated Financial Statements
which  includes an emphasis paragraph that raises the question of whether or not
SIG  can  continue  as a going concern. SIG's plans to improve financial results
are  described  above.

ITEM  3.  QUALITATIVE  AND  QUANTITATIVE  DISCLOSURES  ABOUT  MARKET  RISK

Information  related  to  Qualitative  and Quantitative Disclosures about Market
Risk  was included under Part I, Item 1 "Business" in the December 31, 2001 Form
10-K.  No  material  changes have occurred in market risk since this information
was  disclosed  in  the  December  31,  2001  Form  10-K.

PART  II  -     OTHER  INFORMATION

ITEM  1.     LEGAL  PROCEEDINGS
As  previously  reported,  IGF  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 March 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.  On  January 16, 2002, the court entered an order granting
IGF's  motion  for  judgment on the pleadings and required plaintiffs to show an
insurable  interest.  Plaintiffs amended their complaint attempting to allege an
insurable  interest,  and on March 19, 2002, the court granted IGF's demurrer to
the  amended  complaint.  In  granting  the  demurrer  the  court  held that any
recovery  payable  to plaintiff would be limited to their actual economic losses
regardless  of  how  much  plaintiffs  thought  they  had  been  promised  (i.e.
plaintiffs  cannot  be  paid  policy  limits  without  regard  to  actual losses
incurred).  The plaintiffs then filed their third amended complaint to which MSI
filed  a  demurrer challenging the insurance contract allegations, as the issuer
of  the  AgPI policies, contending that plaintiffs failed to make the amendments
to  show an insurable interest as required by the court's previous rulings. This
demurrer  was  granted, without leave to amend, because the lack of an insurable
interest rendered the contract an unenforceable wager agreement, as described in
each  of  the  various  versions of the complaint. Plaintiffs have now moved for
reconsideration  of  the  dismissal  of  the insurance claims asking for another
chance  to allege an adequate insurable interest. This hearing is set for August
13,  2002.  Discovery  is  proceeding.

As  previously  reported  in the Company's March 31, 2002 Form 10-Q, MSI and IGF
were  arbitrating  their  dispute  over  responsibility  for  claims paid to MSI
insureds.  Also as previously reported, an action was filed against the Company,
IGF, IGFH, Granite Re, SIG and certain affiliates of those companies, as well as
certain  members  of  the  Symons  family,  and  Acceptance in the United States
District  Court for the Southern District of Indiana which alleged that the June
6, 2001 sale of IGF's assets to Acceptance and the payments by Acceptance to the
Company, SIG and Granite Re violated Indiana law and were voidable.  The parties
have  settled  the arbitration and the Indiana action, and an order of dismissal
was  entered  by  the  court  on  June  26,  2002.

As  previously  reported, 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.  Discovery  in  the  case  is  proceeding.

The  Company  and  its  subsidiaries  are  named  as defendants in various other
lawsuits relating to their business.  Legal actions arise from claims made under
insurance  policies  issued  by  the  Company's  subsidiaries.  The  Company, in
establishing  its  loss reserves, has considered these actions.  There can be no
assurance  that  the  ultimate  disposition  of  these lawsuits will not have an
adverse  material  affect  the  Company's  operations  or  financial  position.

Except as set forth above, there have been no other material developments in any
of the pending legal proceedings previously reported by the Company in the March
31,  2002  Form  10Q.

ITEM  2.     CHANGES  IN  SECURITIES  AND  USE  OF  PROCEEDS
             None

ITEM  3.     DEFAULTS  UPON  SENIOR  SECURITIES
             None

ITEM 4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The Company
             Held  Its  annual  meeting  of shareholders on May 31, 2002.
             Following is a summary of  the  matters  voted  on  at  the
             meeting:

-    The  following  six nominees for director were re-elected to
     the  board by a  vote  of  2,650,378  in  favor:
                     John  R.  McKeating            G.  Gordon  Symons
                     Alan  G.  Symons               Douglas  H. Symons
                     J.  Ross  Schofield            David  B.  Shapira

-    BDO  Seidman, LLP was re-appointed as the Company's
     independent  auditors by  a  vote  of  2,653,478  in  favor.

ITEM 5.      OTHER INFORMATION On June 10, 2002 the Company announced the
             retirement  of  Alan  G.  Symons,  the  Company's chief executive
             officer.  Mr. Symons also retired from all directorships with the
             Company  and  its  subsidiaries.  At  the  same time, the Company
             announced  the appointments of Douglas H. Symons as the Company's
             chief  executive  officer  and Robert C. Whiting as a director of
             the  Company.

ITEM  6.     EXHIBITS  AND  REPORTS  ON  FORM  8-K

             Exhibits:  None
             Reports  on  Form  8-K:  None


<PAGE>


SIGNATURES

Pursuant  to  the requirements of Section 13 or 15(d) of the Securities Exchange
Act  of  1934,  the  Registrant  has duly caused this report to be signed on its
behalf  by  the  undersigned,  thereunto  duly  authorized  on  August 13, 2002.



                                 By:  /s/  Douglas  H.  Symons
                                 -----------------------------
                                 Douglas  H.  Symons
                                 Chief  Executive  Officer
                                (principal  executive  officer)


                                 By:  /s/  John  G.  Pendl
                                 -----------------------------
                                 John  G.  Pendl
                                 Chief  Financial  Officer
                                (principal  financial  and  accounting  officer)


<PAGE>


                            CERTIFICATION PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In  connection  with the Quarterly Report of Goran Capital, Inc. (the "Company")
on  Form  10-Q  for  the quarterly period ended June 30, 2002, as filed with the
Securities  and  Exchange  Commission  on  the  date  hereof (the "Report"), the
undersigned,  in  the  capacities  and  dates  indicates  below,  hereby certify
pursuant  to  18  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley  Act  of  2002,  that:  (1)  the  Report  fully complies with the
requirements  of  Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and (2) the information contained in the Report fairly presents, in all material
respects,  the  financial  condition  and  results  of operation of the Company.



Dated: August 13, 2002           By: /s/ Douglas H. Symons
                                 ------------------------
                                 Douglas  H.  Symons
                                 Chief  Executive  Officer
                                (principal  executive  officer)

Dated: August 13, 2002           By:  /s/  John G. Pendl
                                 ------------------------
                                 John  G.  Pendl
                                 Chief  Financial  Officer
                                (principal  financial  and  accounting officer)

<PAGE>



<TABLE>
<CAPTION>

Goran  Capital  Inc.  -  Consolidated
Analysis  of  Loss  Per  Share
US  GAAP  -  Treasury  Method

                                                          Three Months     Three Months
                                                             Ended             Ended
                                                          June 30, 2002    June 30, 2001
                                                         ---------------  ---------------
<S>                                                             <C>              <C>
Average Price (US $). . . . . . . . . . . . . . . . . .         N/A              N/A

Proceeds from Exercise of Warrants and Options (US $) .         Nil              Nil

Shares Repurchased - Treasury Method. . . . . . . . . .         Nil              Nil

Shares Outstanding - Weighted Average . . . . . . . . .       5,393,698        5,776,398

Add:  Options and Warrants Outstanding (1). . . . . . .         Nil              Nil

Less:  Treasury Method - Shares Repurchased . . . . .        .  Nil              Nil

Shares Outstanding for US GAAP Purposes . . . . . . . .       5,393,698        5,776,398

Net Loss in Accordance with US GAAP . . . . . . . . .     $  (8,386,000)   $  (6,096,000)

Net Loss Per Share - US GAAP - Basic and Fully Diluted.   $       (1.55)   $       (1.05)

<FN>

(1)  Only  those  options with a dilutive effect were included above for the three months
ended  June  30,  2002  and  2001.
</TABLE>