##### Table of Contents









UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


Form 10-K


|   |  |                                                                                             
|-- |  | --------------------------------------------------------------------------------------------
|þ  |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934    
|  
|   |  | For the fiscal year ended December 31, 2005                                                 
|  
|OR
|  
|o  |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|  
|   |  | For the transition period
    from           to                                             

Commission file number 000-51530


NORTH POINTE HOLDINGS CORPORATION


(Exact name of registrant as specified in its charter)


|                                                                   |  |                                         
|------------------------------------------------------------------ |  | ----------------------------------------
|Michigan                                                           |  | 38-3615047                              
|(State or other jurisdiction of
    incorporation or organization) |  | (I.R.S. Employer
    Identification No.)
|                                                                  
|28819 Franklin Road                                                |  | 48034                                   
|Southfield, Michigan(Address of principal executive offices)       |  | (Zip Code)                              

(Registrants telephone number, including area code)


(248) 358-1171


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


|                           |  |                                          
|-------------------------- |  | -----------------------------------------
|Title of Each Class        |  | Name of Each Exchange on Which Registered
|                           |  |                                          
|Common Stock, No par value |  | Nasdaq Stock Market                      

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


None


o þ


o þ


þ o


S-K 10-K 10-K. þ o


12b-2




|                           |                      |                         
|-------------------------- | -------------------- | ------------------------
|Large accelerated filer  o | Accelerated filer  o | Non-accelerated filer  þ

12b-2 o þ






Documents incorporated by reference are as follows:


|                                                                                                                                                                           |  |                                  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------
|                                                                                                                                                                           |  | Part and Item Number of          
|Document                                                                                                                                                                   |  | Form 10-K into Which Incorporated
|                                                                                                                                                                           |  |                                  
|North Pointe Holdings Corporation Notice of
    Annual Meeting of Shareholders and Proxy
    Statement for the Annual Meeting of Shareholders
    to be held June 21, 2006 |  | Part III, Items 10 through 14    









---



##### 










FORM 10-K TABLE OF
CONTENTS


|                                                                                             |  |                                                                                                                       |  |      |     | 
|-------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                                                                                             |  |                                                                                                                       |  | PAGE |    
|PART I:                                                                                     
|Item 1.                                                                                      |  | Business                                                                                                              |  |      | 3   | 
|Item 1A.                                                                                     |  | Risk Factors                                                                                                          |  |      | 24  | 
|Item 2.                                                                                      |  | Properties                                                                                                            |  |      | 36  | 
|Item 3.                                                                                      |  | Legal Proceedings                                                                                                     |  |      | 36  | 
|Item 4.                                                                                      |  | Submission of Matters to a Vote of Security
    Holders                                                               |  |      | 36  | 
|PART II:                                                                                    
|Item 5.                                                                                      |  | Market for Registrants Common Equity,
    Related Stockholder Matters, and Issuer Purchases of Equity
    Securities |  |      | 37  | 
|Item 6.                                                                                      |  | Selected Financial Data                                                                                               |  |      | 38  | 
|Item 7.                                                                                      |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations                             |  |      | 41  | 
|Item 7A.                                                                                     |  | Quantitative and Qualitative Disclosures
    About Market Risk                                                        |  |      | 62  | 
|Item 8.                                                                                      |  | Financial Statements and Supplementary
    Data                                                                       |  |      | 64  | 
|Item 9.                                                                                      |  | Changes in and Disagreements with
    Accountants on Accounting and Financial Disclosure                              |  |      | 66  | 
|Item 9A.                                                                                     |  | Controls and Procedures                                                                                               |  |      | 66  | 
|PART III:                                                                                   
|Item 10.                                                                                     |  | Directors and Executive Officers of the
    Registrant                                                                |  |      | 67  | 
|Item 11.                                                                                     |  | Executive Compensation                                                                                                |  |      | 67  | 
|Item 12.                                                                                     |  | Security Ownership of Certain Beneficial
    Owners and Management and Related Stockholder Matters                    |  |      | 67  | 
|Item 13.                                                                                     |  | Certain Relationships and Related
    Transactions                                                                    |  |      | 67  | 
|Item 14.                                                                                     |  | Principal Accountant Fees and Services                                                                                |  |      | 67  | 
|PART IV:                                                                                    
|Item 15.                                                                                     |  | Exhibits, Financial Statement Schedules,
    and Reports on Form 8-K                                                  |  |      | 67  | 
|Item 15(a)(1).                                                                               |  | Financial Statements and Report of
    Independent Registered Public Accounting Firm                                  |  |      | 67  | 
|Item 15(a)(2).                                                                               |  | Financial Statement Schedules                                                                                         |  |      | 98  | 
|Item 15(a)(3).                                                                               |  | Exhibit Index                                                                                                         |  |      | 109 | 
|Junior Subordinate Indenture, dated as of February 22, 2006                                 
|Form of Floating Rate Junior Subordinated Note Due 2036                                     
|Form of Preferred Securities Certificate of NP Capital Trust I                              
|Form of Certificate Evidencing Common Securities of  NP Capital Trust I                     
|Line of Credit Loan Agreement, dated March 4, 2005                                          
|Line of Credit Note, dated March 4, 2005                                                    
|Consulting Agreement, dated March 5, 2003                                                   
|Consulting Agreement, dated September 30, 2005                                              
|Trust Agreement of NP Capital Trust I, dated as of February 21, 2006                        
|Amended and Restated Trust Agreement, dated as of February 22, 2006                         
|Guarantee Agreement, dated February 22, 2006                                                
|Purchase Agreement, dated as of February 22, 2006                                           
|Junior Subordinated Note Purchase Agreement, dated as of February 22, 2006                  
|Waiver and Consent Letter Dated February 21, 2005                                           
|Waiver Letter Dated February 28, 2005 to the Amended and Restated Credit Agreement          
|Assumption of Mortgage Agreement for the Purchase Agreement, dated 8/18/2005                
|Amendment No. 5 to Amended and Restated Credit Agreement, dated September 22, 2005          
|Subsidiaries of North Pointe Holdings Corporation                                           
|Certification of Chief Executive Officer pursuant to Rule 13a-14(a)                         
|Certification of Chief Financial Officer pursuant to Rule 13a-14(a)                         
|Certification of Chief Executive Officer & Chief Financial Officer to 18 U.S.C. Section 1350



2



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##### Table of Contents



PART I




|        |          
|------- | ---------
|Item 1. | BUSINESS.

10-K.


10-K:


The Company




Industry Information






3



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Our Product Lines




|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |   |        |        |  |  |        |       | 
|------------------------- | ---------------------- | ------------------------ | ------ | ------ | ----- |  | ------ | ------ | ---- | - | ------ | ------ |  | ------ | ------ | ----- | ----- | - | ------ | ------ |  |  | ------ | ----- | 
|                          |                        | Years Ended December 31, |       
|                          |                        |                          |       
|                          |                        | 2005                     |        |        | 2004  |  |        | 2003   |     
|                          |                        |                          |        |        |       |  |        |        |     
|                          |                        |                          |        | % of   |       |  |        |        | % of |   |        |        |  | % of   |       
|                          |                        | Amount                   |        |        | Total |  |        | Amount |      |   | Total  |        |  | Amount |        |       | Total |  
|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |  
|                          |                        | (Dollars in thousands)   |       
|Commercial Lines:         |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |   |        |        |  |  |        |      
|Liquor liability          |                        | $                        | 10,913 |        |       |  | 12.9%  |        |      | $ | 10,818 |        |  |        | 14.1%  |       |       | $ | 9,790  |        |  |  | 14.2%  |      
|General liability         |                        |                          | 12,807 |        |       |  | 15.1%  |        |      |   | 10,734 |        |  |        | 13.9%  |       |       |   | 8,005  |        |  |  | 11.6%  |      
|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |  
|                          | Total liability        |                          |        | 23,720 |       |  |        | 28.0%  |      |   |        | 21,552 |  |        |        | 28.0% |       |   |        | 17,795 |  |  |        | 25.8% | 
|Property                  |                        |                          | 6,299  |        |       |  | 7.4%   |        |      |   | 7,129  |        |  |        | 9.3%   |       |       |   | 5,258  |        |  |  | 7.6%   |      
|Commercial multi-peril    |                        |                          | 22,230 |        |       |  | 26.2%  |        |      |   | 18,968 |        |  |        | 24.6%  |       |       |   | 13,313 |        |  |  | 19.4%  |      
|Commercial automobile     |                        |                          | 6,156  |        |       |  | 7.3%   |        |      |   | 5,412  |        |  |        | 7.0%   |       |       |   | 6,928  |        |  |  | 10.1%  |      
|Other                     |                        |                          | 2,661  |        |       |  | 3.2%   |        |      |   | 2,274  |        |  |        | 3.0%   |       |       |   | 2,182  |        |  |  | 3.2%   |      
|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |  
|                          | Total commercial lines |                          |        | 61,066 |       |  |        | 72.1%  |      |   |        | 55,335 |  |        |        | 71.9% |       |   |        | 45,476 |  |  |        | 66.1% | 
|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |  
|Personal Lines:           |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |   |        |        |  |  |        |      
|Automobile                |                        |                          | 1,459  |        |       |  | 1.7%   |        |      |   | 15,109 |        |  |        | 19.6%  |       |       |   | 16,675 |        |  |  | 24.3%  |      
|Homeowners                |                        |                          | 22,211 |        |       |  | 26.2%  |        |      |   | 6,513  |        |  |        | 8.5%   |       |       |   | 6,589  |        |  |  | 9.6%   |      
|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |  
|                          | Total personal lines   |                          |        | 23,670 |       |  |        | 27.9%  |      |   |        | 21,622 |  |        |        | 28.1% |       |   |        | 23,264 |  |  |        | 33.9% | 
|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |  
|Total net premiums earned |                        | $                        | 84,736 |        |       |  | 100.0% |        |      | $ | 76,957 |        |  |        | 100.0% |       |       | $ | 68,740 |        |  |  | 100.0% |      
|                          |                        |                          |        |        |       |  |        |        |      |   |        |        |  |        |        |       |       |  



| |                              
| | -----------------------------
| | Commercial Insurance Products



Liquor Liability.


4



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General Liability.


Property.


Commercial Multi-Peril.


Commercial Automobile.




Other Program Business.




| |                            
| | ---------------------------
| | Personal Insurance Products



Homeowners and Dwelling/ Fire.




5



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Automobile.


Flood Insurance Product.






| |                        
| | -----------------------
| | Administrative Services



6



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Geographic Distribution




|             |  |                          |       |         |             |  |       |      |  |  |       |   |  |  |       |  
|------------ |  | ------------------------ | ----- | ------- | ----------- |  | ----- | ---- |  |  | ----- | - |  |  | ----- | -
|             |  | Years Ended December 31, |      
|             |  |                          |      
|             |  |                          |       | 2004(1) |             |  |      
|State        |  | 2005                     |       |         | (Pro Forma) |  |       | 2004 |  |  | 2003  |  
|             |  |                          |       |         |             |  |       |      |  |  |       |  
|Florida      |  |                          | 60.6  | %       |             |  | 45.1  | %    |  |  | 36.3  | % |  |  | 28.6  | %
|Michigan     |  |                          | 22.0  | %       |             |  | 30.1  | %    |  |  | 43.8  | % |  |  | 47.3  | %
|Indiana      |  |                          | 5.2   | %       |             |  | 8.4   | %    |  |  | 6.8   | % |  |  | 6.3   | %
|Illinois     |  |                          | 3.8   | %       |             |  | 6.6   | %    |  |  | 5.3   | % |  |  | 10.8  | %
|Ohio         |  |                          | 2.4   | %       |             |  | 3.3   | %    |  |  | 2.7   | % |  |  | 2.7   | %
|New York     |  |                          | 1.1   | %       |             |  | 1.5   | %    |  |  | 1.2   | % |  |  | 0.0   | %
|Pennsylvania |  |                          | 1.2   | %       |             |  | 0.9   | %    |  |  | 0.7   | % |  |  | 0.1   | %
|Iowa         |  |                          | 0.8   | %       |             |  | 1.2   | %    |  |  | 1.0   | % |  |  | 1.4   | %
|New Jersey   |  |                          | 0.6   | %       |             |  | 1.0   | %    |  |  | 0.8   | % |  |  | 0.4   | %
|South Dakota |  |                          | 0.6   | %       |             |  | 0.7   | %    |  |  | 0.5   | % |  |  | 0.4   | %
|All others   |  |                          | 1.7   | %       |             |  | 1.2   | %    |  |  | 0.9   | % |  |  | 2.0   | %
|             |  |                          |       |         |             |  |       |      |  |  |       |  
|             |  |                          | 100.0 | %       |             |  | 100.0 | %    |  |  | 100.0 | % |  |  | 100.0 | %
|             |  |                          |       |         |             |  |       |      |  |  |       |  






|    |                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | After giving effect to the sale of the new and renewal policy
    rights relating to our non-standard personal automobile
    insurance line in October 2004, as if such transaction had
    occurred on January 1, 2004.

Marketing and Distribution








Underwriting and Pricing


Commercial Lines.


7



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Personal Lines.


Claims Handling




up-to


Unpaid Losses and Loss Adjustment Expenses










8



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|                  |  |                                   |       |  |                  |   |        |       |  |   |        | 
|----------------- |  | --------------------------------- | ----- |  | ---------------- | - | ------ | ----- |  | - | ------ | 
|                  |  | Net Reserves at December 31, 2005 |      
|                  |  |                                   |      
|                  |  | Personal Lines                    |       |  | Commercial Lines |   |        |      
|                  |  | Segment                           |       |  | Segment          |   |        | Total | 
|                  |  |                                   |       |  |                  |   |        |       | 
|                  |  | (Dollars in thousands)            |      
|Low end of range  |  | $                                 | 6,764 |  |                  | $ | 45,902 |       |  | $ | 52,666 | 
|Carried reserves  |  |                                   | 7,356 |  |                  |   | 50,388 |       |  |   | 57,744 | 
|High end of range |  |                                   | 9,283 |  |                  |   | 52,254 |       |  |   | 61,537 | 

year-to




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|                  |  |                                   |       |  |                  |  |        |       |  |  |        | 
|----------------- |  | --------------------------------- | ----- |  | ---------------- |  | ------ | ----- |  |  | ------ | 
|                  |  | Net Reserves at December 31, 2005 |      
|                  |  |                                   |      
|                  |  | Personal Lines                    |       |  | Commercial Lines |  |        |      
|                  |  | Segment                           |       |  | Segment          |  |        | Total | 
|                  |  |                                   |       |  |                  |  |        |       | 
|                  |  | (Dollars in thousands)            |      
|Low end of range  |  |                                   | 6,746 |  |                  |  | 46,384 |       |  |  | 53,130 | 
|Carried reserves  |  |                                   | 7,356 |  |                  |  | 50,388 |       |  |  | 57,744 | 
|High end of range |  |                                   | 8,172 |  |                  |  | 52,249 |       |  |  | 60,421 | 





|                                 |                        |                        |        |            |             |          |        |           |            |   |             |        |  |            |        |        |             |   |        |        |  |   |        |        |  
|-------------------------------- | ---------------------- | ---------------------- | ------ | ---------- | ----------- | -------- | ------ | --------- | ---------- | - | ----------- | ------ |  | ---------- | ------ | ------ | ----------- | - | ------ | ------ |  | - | ------ | ------ | -
|                                 |                        | 2005                   |        |            | 2004        |          |        | 2003      |           
|                                 |                        |                        |        |            |             |          |        |           |           
|                                 |                        |                        |        |            |             | Increase |        |           |            |   | Increase    |       
|                                 |                        |                        |        | (Decrease) |             |          |        |           | (Decrease) |   |             |        |  | (Decrease) |       
|                                 |                        | Net                    |        |            | in Estimate |          |        | Net       |            |   | in Estimate |        |  | Net        |        |        | in Estimate |  
|                                 |                        | Reserves               |        |            | of          |          |        | Reserves  |            |   | of          |        |  | Reserves   |        |        | of          |  
|                                 |                        | at                     |        |            | Beginning   |          |        | at        |            |   | Beginning   |        |  | at         |        |        | Beginning   |  
|                                 |                        | Beginning              |        |            | of Year Net |          |        | Beginning |            |   | of Year Net |        |  | Beginning  |        |        | of Year Net |  
|Lines of Business                |                        | of Year                |        |            | Reserves    |          |        | of Year   |            |   | Reserves    |        |  | of Year    |        |        | Reserves    |  
|                                 |                        |                        |        |            |             |          |        |           |            |   |             |        |  |            |        |        |             |  
|                                 |                        | (Dollars in thousands) |       
|RBT and bowling center           |                        | $                      | 23,998 |            |             | $        | (2,080 | )         |            | $ | 21,536      |        |  | $          | (1,006 | )      |             | $ | 22,741 |        |  | $ | (3,081 | )     
|Commercial automobile            |                        |                        | 3,394  |            |             |          | (191   | )         |            |   | 7,814       |        |  |            | (1,948 | )      |             |   | 9,228  |        |  |   | (1,890 | )     
|North Pointe Casualty run off(1) |                        |                        | 557    |            |             |          | (100   | )         |            |   | 6,072       |        |  |            | (2,526 | )      |             |   |       |        |  |   |       |       
|Florida small business           |                        |                        | 17,393 |            |             |          | (848   | )         |            |   | 8,352       |        |  |            | (345   | )      |             |   | 5,430  |        |  |   | (289   | )     
|Other                            |                        |                        | 2,120  |            |             |          | (244   | )         |            |   | 1,579       |        |  |            | 385    |        |             |   | 2,416  |        |  |   | (266   | )     
|                                 |                        |                        |        |            |             |          |        |           |            |   |             |        |  |            |        |        |             |  
|                                 | Total commercial lines |                        |        | 47,462     |             |          |        | (3,463    | )          |   |             | 45,353 |  |            |        | (5,440 | )           |   |        | 39,815 |  |   |        | (5,526 | )
|Personal automobile              |                        |                        | 10,506 |            |             |          | (1,290 | )         |            |   | 12,315      |        |  |            | (198   | )      |             |   | 13,557 |        |  |   | 308    |       
|Homeowners                       |                        |                        | 2,049  |            |             |          | (682   | )         |            |   | 2,042       |        |  |            | (354   | )      |             |   | 1,131  |        |  |   | (210   | )     
|                                 |                        |                        |        |            |             |          |        |           |            |   |             |        |  |            |        |        |             |  
|                                 | Total personal lines   |                        |        | 12,555     |             |          |        | (1,972    | )          |   |             | 14,357 |  |            |        | (552   | )           |   |        | 14,688 |  |   |        | 98     |  
|                                 |                        |                        |        |            |             |          |        |           |            |   |             |        |  |            |        |        |             |  
|                                 | Total lines            |                        | $      | 60,017     |             |          | $      | (5,435    | )          |   | $           | 59,710 |  |            | $      | (5,992 | )           |   | $      | 54,503 |  |   | $      | (5,428 | )
|                                 |                        |                        |        |            |             |          |        |           |            |   |             |        |  |            |        |        |             |  






| |     |                                                                                                                              
| | --- | -----------------------------------------------------------------------------------------------------------------------------
| | (1) | Includes $6.1 million of net reserves acquired on
    February 28, 2004 as part of the North Pointe Casualty
    acquisition.



10



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11



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12



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Analysis of Loss and Loss Adjustment Expense Development


|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|------------------------------------------------------------ | ----------------- | ------------------------ | ------ | ------ | ---- | - | ------ | ------ |  | - | ------ | ------ |  | ---- | ------ | ------ | ---- | - | ------ | ------ |  | - | ------ | ------ |  | ---- | ------ | ------ | ---- | - | ------ | ------ |  | - | ------ | ------ |  | - | ------ | ------ |  | - | ------- |  | 
|                                                             |                   | Years Ended December 31, |       
|                                                             |                   |                          |       
|                                                             |                   | 1995                     |        |        | 1996 |   |        | 1997   |  |   | 1998   |        |  | 1999 |        |        | 2000 |   |        | 2001   |  |   | 2002   |        |  | 2003 |        |        | 2004 |   |        | 2005   | 
|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        | 
|                                                             |                   | (Dollars in thousands)   |       
|Cumulative amount of net liability paid as of:               |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         | 
|                                                             | One year later    |                          | $      | 6,847  |      |   | $      | 5,130  |  |   | $      | 5,821  |  |      | $      | 14,070 |      |   | $      | 17,508 |  |   | $      | 17,896 |  |      | $      | 20,687 |      |   | $      | 20,472 |  |   | $      | 18,778 |  |   | $      | 22,334 |  |   |         |  | 
|                                                             | Two years later   |                          |        | 11,653 |      |   |        | 10,233 |  |   |        | 10,099 |  |      |        | 22,802 |      |   |        | 28,730 |  |   |        | 28,100 |  |      |        | 32,798 |      |   |        | 32,000 |  |   |        | 30,453 |  |   |        |        |  |   |         |  | 
|                                                             | Three years later |                          |        | 13,327 |      |   |        | 12,112 |  |   |        | 12,881 |  |      |        | 29,385 |      |   |        | 34,019 |  |   |        | 33,796 |  |      |        | 39,098 |      |   |        | 38,680 |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Four years later  |                          |        | 13,892 |      |   |        | 13,323 |  |   |        | 13,909 |  |      |        | 32,219 |      |   |        | 36,259 |  |   |        | 36,000 |  |      |        | 42,443 |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Five years later  |                          |        | 14,554 |      |   |        | 13,750 |  |   |        | 14,290 |  |      |        | 33,462 |      |   |        | 36,969 |  |   |        | 36,653 |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Six years later   |                          |        | 14,829 |      |   |        | 13,941 |  |   |        | 14,589 |  |      |        | 33,724 |      |   |        | 37,068 |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Seven years later |                          |        | 14,870 |      |   |        | 14,127 |  |   |        | 14,563 |  |      |        | 33,752 |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Eight years later |                          |        | 14,995 |      |   |        | 14,170 |  |   |        | 14,571 |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Nine years later  |                          |        | 14,996 |      |   |        | 14,169 |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Ten years later   |                          |        | 15,002 |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                            
|Gross liability  end of year                                |                   |                          | 22,365 |        |      |   | 22,504 |        |  |   | 24,556 |        |  |      | 60,595 |        |      |   | 66,561 |        |  |   | 70,749 |        |  |      | 87,201 |        |      |   | 82,949 |        |  |   | 76,319 |        |  |   | 96,561 |        |  |   | 117,778 | 
|Reinsurance recoverable on unpaid losses                     |                   |                          | 3,190  |        |      |   | 3,160  |        |  |   | 3,846  |        |  |      | 14,555 |        |      |   | 16,449 |        |  |   | 20,544 |        |  |      | 30,497 |        |      |   | 28,446 |        |  |   | 22,681 |        |  |   | 36,544 |        |  |   | 60,034  | 
|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        | 
|Net liability  end of year                                  |                   |                          | 19,175 |        |      |   | 19,344 |        |  |   | 20,710 |        |  |      | 46,040 |        |      |   | 50,112 |        |  |   | 50,205 |        |  |      | 56,704 |        |      |   | 54,503 |        |  |   | 53,638 |        |  |   | 60,017 |        |  |   | 57,744  | 
|Gross liability re-estimated-latest                          |                   |                          | 19,324 |        |      |   | 18,168 |        |  |   | 20,285 |        |  |      | 49,827 |        |      |   | 59,333 |        |  |   | 66,017 |        |  |      | 73,393 |        |      |   | 67,321 |        |  |   | 70,290 |        |  |   | 98,255 |        |  |   |         | 
|Reinsurance recoverable on unpaid losses re-estimated-latest |                   |                          | 4,235  |        |      |   | 3,898  |        |  |   | 5,591  |        |  |      | 15,547 |        |      |   | 21,047 |        |  |   | 26,390 |        |  |      | 27,588 |        |      |   | 20,659 |        |  |   | 24,266 |        |  |   | 43,673 |        |  |   |         | 
|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        | 
|Net liability re-estimated-latest                            |                   |                          | 15,089 |        |      |   | 14,270 |        |  |   | 14,694 |        |  |      | 34,280 |        |      |   | 38,286 |        |  |   | 39,627 |        |  |      | 45,805 |        |      |   | 46,662 |        |  |   | 46,024 |        |  |   | 54,582 |        |  |   |         | 
|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        | 
|Gross cumulative redundancy (deficiency)                     |                   | $                        | 3,041  |        |      | $ | 4,336  |        |  | $ | 4,271  |        |  | $    | 10,768 |        |      | $ | 7,228  |        |  | $ | 4,732  |        |  | $    | 13,808 |        |      | $ | 15,628 |        |  | $ | 6,029  |        |  | $ | (1,694 | )      |  |   |         | 
|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        | 
|                                                            
|Net liability for losses and loss expenses                   |                   | $                        | 19,175 |        |      | $ | 19,344 |        |  | $ | 20,710 |        |  | $    | 46,040 |        |      | $ | 50,112 |        |  | $ | 50,205 |        |  | $    | 56,704 |        |      | $ | 54,503 |        |  | $ | 53,638 |        |  | $ | 60,017 |        |  | $ | 57,744  | 
|Liability re-estimated as of:                                |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         | 
|                                                             | One year later    |                          |        | 17,959 |      |   |        | 15,831 |  |   |        | 18,388 |  |      |        | 42,782 |      |   |        | 47,575 |  |   |        | 46,431 |  |      |        | 51,548 |      |   |        | 48,871 |  |   |        | 50,172 |  |   |        | 54,582 |  |   |         |  | 
|                                                             | Two years later   |                          |        | 16,207 |      |   |        | 15,643 |  |   |        | 16,287 |  |      |        | 38,995 |      |   |        | 43,018 |  |   |        | 44,734 |  |      |        | 46,998 |      |   |        | 47,605 |  |   |        | 46,029 |  |   |        |        |  |   |         |  | 
|                                                             | Three years later |                          |        | 15,480 |      |   |        | 14,350 |  |   |        | 16,401 |  |      |        | 36,634 |      |   |        | 40,967 |  |   |        | 41,084 |  |      |        | 46,204 |      |   |        | 46,662 |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Four years later  |                          |        | 15,010 |      |   |        | 14,829 |  |   |        | 15,124 |  |      |        | 35,457 |      |   |        | 39,092 |  |   |        | 39,888 |  |      |        | 45,805 |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Five years later  |                          |        | 15,557 |      |   |        | 14,272 |  |   |        | 15,065 |  |      |        | 34,912 |      |   |        | 38,572 |  |   |        | 39,627 |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Six years later   |                          |        | 15,196 |      |   |        | 14,407 |  |   |        | 15,094 |  |      |        | 34,535 |      |   |        | 38,286 |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Seven years later |                          |        | 15,256 |      |   |        | 14,449 |  |   |        | 14,871 |  |      |        | 34,280 |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Eight years later |                          |        | 15,257 |      |   |        | 14,380 |  |   |        | 14,694 |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Nine years later  |                          |        | 15,154 |      |   |        | 14,270 |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             | Ten years later   |                          |        | 15,089 |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |   |        |        |  |   |         |  | 
|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        | 
|Net cumulative redundancy                                    |                   | $                        | 4,086  |        |      | $ | 5,074  |        |  | $ | 6,016  |        |  | $    | 11,760 |        |      | $ | 11,826 |        |  | $ | 10,578 |        |  | $    | 10,899 |        |      | $ | 7,841  |        |  | $ | 7,614  |        |  | $ | 5,435  |        |  |   |         | 
|                                                             |                   |                          |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        |  |   |        |        |  |      |        |        |      |   |        |        | 

13



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##### Table of Contents







|       |                           |                        |                        |   |        |        |        |      |        |        |        |   |        |        | 
|------ | ------------------------- | ---------------------- | ---------------------- | - | ------ | ------ | ------ | ---- | ------ | ------ | ------ | - | ------ | ------ | 
|       |                           | As of December 31,     |                       
|       |                           |                        |                       
|       |                           | 2005                   |                        |   | 2004   |        |        | 2003 |       
|       |                           |                        |                        |   |        |        |        |      |       
|       |                           | (Dollars in thousands) |                       
|Case:  |                           |                        |                        |   |        |        |        |      |        |        |        |  
|       | Commercial lines products |                        |                        |   |        |        |        |      |        |        |        |   |       
|       |                           | Liability              |                        | $ | 13,180 |        |        | $    | 11,679 |        |        | $ | 11,132 |       
|       |                           | Property               |                        |   | 8,246  |        |        |      | 7,482  |        |        |   | 256    |       
|       |                           | Commercial multi-peril |                        |   | 19,942 |        |        |      | 15,507 |        |        |   | 5,150  |       
|       |                           | Commercial automobile  |                        |   | 4,325  |        |        |      | 5,132  |        |        |   | 7,540  |       
|       |                           | Other                  |                        |   | 772    |        |        |      | 764    |        |        |   | 271    |       
|       |                           |                        |                        |   |        |        |        |      |       
|       |                           |                        | Total commercial lines |   |        | 46,465 |        |      |        | 40,564 |        |   |        | 24,349 | 
|       |                           |                        |                        |   |        |        |        |      |       
|       | Personal lines products   |                        |                        |   |        |        |        |      |        |        |        |   |       
|       |                           | Personal automobile    |                        |   | 6,128  |        |        |      | 9,830  |        |        |   | 11,195 |       
|       |                           | Homeowners             |                        |   | 8,893  |        |        |      | 1,400  |        |        |   | 1,637  |       
|       |                           |                        |                        |   |        |        |        |      |       
|       |                           |                        | Total personal lines   |   |        | 15,021 |        |      |        | 11,230 |        |   |        | 12,832 | 
|       |                           |                        |                        |   |        |        |        |      |       
|Total  |                           |                        | 61,486                 |   |        |        | 51,794 |      |        |        | 37,181 |  
|       |                           |                        |                        |   |        |        |        |      |       
|IBNR:  |                           |                        |                        |   |        |        |        |      |        |        |        |  
|       | Commercial lines products |                        |                        |   |        |        |        |      |        |        |        |   |       
|       |                           | Liability              |                        | $ | 13,742 |        |        | $    | 15,380 |        |        | $ | 13,993 |       
|       |                           | Property               |                        |   | 3,868  |        |        |      | 825    |        |        |   | 574    |       
|       |                           | Commercial multi-peril |                        |   | 14,613 |        |        |      | 10,600 |        |        |   | 5,224  |       
|       |                           | Commercial automobile  |                        |   | 2,622  |        |        |      | 3,117  |        |        |   | 4,619  |       
|       |                           | Other                  |                        |   | 805    |        |        |      | 2,082  |        |        |   | 940    |       
|       |                           |                        |                        |   |        |        |        |      |       
|       |                           |                        | Total commercial lines |   |        | 35,650 |        |      |        | 32,004 |        |   |        | 25,350 | 
|       |                           |                        |                        |   |        |        |        |      |       
|       | Personal lines products   |                        |                        |   |        |        |        |      |        |        |        |   |       
|       |                           | Personal automobile    |                        |   | 9,451  |        |        |      | 12,115 |        |        |   | 13,388 |       
|       |                           | Homeowners             |                        |   | 11,191 |        |        |      | 648    |        |        |   | 400    |       
|       |                           |                        |                        |   |        |        |        |      |       
|       |                           |                        | Total personal lines   |   |        | 20,642 |        |      |        | 12,763 |        |   |        | 13,788 | 
|       |                           |                        |                        |   |        |        |        |      |       
|Total  |                           |                        | 56,292                 |   |        |        | 44,767 |      |        |        | 39,138 |  
|       |                           |                        |                        |   |        |        |        |      |       
|Total: |                           |                        |                        |   |        |        |        |      |        |        |        |  
|       | Commercial lines products |                        |                        |   |        |        |        |      |        |        |        |   |       
|       |                           | Liability              |                        | $ | 26,922 |        |        | $    | 27,059 |        |        | $ | 25,125 |       
|       |                           | Property               |                        |   | 12,114 |        |        |      | 8,307  |        |        |   | 830    |       
|       |                           | Commercial multi-peril |                        |   | 34,555 |        |        |      | 26,107 |        |        |   | 10,374 |       
|       |                           | Commercial automobile  |                        |   | 6,947  |        |        |      | 8,249  |        |        |   | 12,159 |       
|       |                           | Other                  |                        |   | 1,577  |        |        |      | 2,846  |        |        |   | 1,211  |       
|       |                           |                        |                        |   |        |        |        |      |       
|       |                           |                        | Total commercial lines |   |        | 82,115 |        |      |        | 72,568 |        |   |        | 49,699 | 
|       |                           |                        |                        |   |        |        |        |      |       
|       | Personal lines products   |                        |                        |   |        |        |        |      |        |        |        |   |       
|       |                           | Personal automobile    |                        |   | 15,579 |        |        |      | 21,945 |        |        |   | 24,583 |       
|       |                           | Homeowners             |                        |   | 20,084 |        |        |      | 2,048  |        |        |   | 2,037  |       
|       |                           |                        |                        |   |        |        |        |      |       
|       |                           |                        | Total personal lines   |   |        | 35,663 |        |      |        | 23,993 |        |   |        | 26,620 | 
|       |                           |                        |                        |   |        |        |        |      |       
|Total  |                           | $                      | 117,778                |   |        | $      | 96,561 |      |        | $      | 76,319 |  
|       |                           |                        |                        |   |        |        |        |      |       

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##### Table of Contents







Investments








|                          |                                         |                         |        |            |           |  |      |        |            |   |           |        |         |  |      |      |       |  
|------------------------- | --------------------------------------- | ----------------------- | ------ | ---------- | --------- |  | ---- | ------ | ---------- | - | --------- | ------ | ------- |  | ---- | ---- | ----- | -
|                          |                                         | 2005                    |        |            | 2004      | 
|                          |                                         |                         |        |            |           | 
|                          |                                         |                         |        | Percent of |           |  |      |        | Percent of |  
|                          |                                         | Amount                  |        |            | Portfolio |  |      | Amount |            |   | Portfolio |       
|                          |                                         |                         |        |            |           |  |      |        |            |   |           |       
|                          |                                         | (Dollars in thousands)  |       
|Fixed-income:             |                                         |                         |        |            |           |  |      |        |            |   |           |        |         |  |      |     
|                          | U.S. governmental and agency securities |                         | $      | 20,672     |           |  |      | 14.5   | %          |   | $         | 33,146 |         |  |      | 28.8 | %    
|                          | Foreign government                      |                         |        | 561        |           |  |      | 0.4    | %          |   |           |       |         |  |      |     |      
|                          | Corporate securities                    |                         |        | 31,509     |           |  |      | 22.0   | %          |   |           | 19,795 |         |  |      | 17.2 | %    
|                          | Mortgage-backed securities              |                         |        | 32,847     |           |  |      | 23.0   | %          |   |           | 23,127 |         |  |      | 20.0 | %    
|                          | Asset-backed securities                 |                         |        | 12,429     |           |  |      | 8.7    | %          |   |           |       |         |  |      |     |      
|                          |                                         |                         |        |            |           |  |      |        |            |   |           |       
|                          |                                         | Total fixed-income      |        |            | 98,018    |  |      |        | 68.6       | % |           |        | 76,068  |  |      |      | 66.0  | %
|                          |                                         |                         |        |            |           |  |      |        |            |   |           |       
|Cash and cash equivalents |                                         |                         | 34,319 |            |           |  | 24.0 | %      |            |   | 29,878    |        |         |  | 25.9 | %   
|Equity securities:        |                                         |                         |        |            |           |  |      |        |            |   |           |        |         |  |      |     
|                          | Common shares                           |                         |        | 10,001     |           |  |      | 7.0    | %          |   |           | 9,280  |         |  |      | 8.1  | %    
|                          |                                         |                         |        |            |           |  |      |        |            |   |           |       
|                          |                                         | Total equity securities |        |            | 10,001    |  |      |        | 7.0        | % |           |        | 9,280   |  |      |      | 8.1   | %
|                          |                                         |                         |        |            |           |  |      |        |            |   |           |       
|                          | Other investments                       |                         |        | 553        |           |  |      | 0.4    | %          |   |           |       |         |  |      |     |      
|                          |                                         |                         |        |            |           |  |      |        |            |   |           |       
|                          |                                         | Total                   |        | $          | 142,891   |  |      |        | 100.0      | % |           | $      | 115,226 |  |      |      | 100.0 | %
|                          |                                         |                         |        |            |           |  |      |        |            |   |           |       

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##### Table of Contents







|                               |       |  |      |       |  
|------------------------------ | ----- |  | ---- | ----- | -
|Treasury and Government Agency |       |  | 43.8 | %    
|AAA                          |       |  | 25.0 | %    
|AA                           |       |  | 4.4  | %    
|A                            |       |  | 18.2 | %    
|BBB                          |       |  | 8.6  | %    
|                               |       |  |     
|                               | Total |  |      | 100.0 | %
|                               |       |  |     





| |   |                                                                                                  
| | - | -------------------------------------------------------------------------------------------------
| |  | the length of time and extent to which fair value of the
    security has been less than cost;   
|
| |  | the financial condition and near-term prospects of the issuer of
    the security; and           
|
| |  | our ability and willingness to hold the security until the fair
    value is expected to recover.











10-K.


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##### Table of Contents



Reinsurance








|                                       |       |                  |                  |             |                  |   |        |        | 
|-------------------------------------- | ----- | ---------------- | ---------------- | ----------- | ---------------- | - | ------ | ------ | 
|Reinsurer                              |       | A.M. Best Rating |                  |             | Gross Amount Due |  
|                                       |       |                  |                  |             |                  |  
|                                       |       |                  |                  | (Dollars in |                 
|                                       |       |                  |                  | thousands)  |                 
|Swiss Reinsurance American Corporation |       |                  | A+ (Superior)  |             |                  | $ | 16,779 |       
|MCCA                                   |       |                  | N/A(1)           |             |                  |   | 11,196 |       
|Florida Hurricane Catastrophe Fund     |       |                  | N/A(1)           |             |                  |   | 7,210  |       
|QBE Reinsurance Corporation            |       |                  | A (Excellent)  |             |                  |   | 5,458  |       
|Folksamerica Reinsurance Company       |       |                  | A (Excellent)  |             |                  |   | 4,353  |       
|General Reinsurance Corporation        |       |                  | A++ (Superior) |             |                  |   | 3,533  |       
|Lloyds Syndicate 2001 AML              |       |                  | A (Excellent)  |             |                  |   | 3,396  |       
|Platinum Reinsurance Company           |       |                  | A (Excellent)  |             |                  |   | 2,672  |       
|Hannover Re Ltd                        |       |                  | A (Excellent)  |             |                  |   | 2,579  |       
|XL Reinsurance American, Inc.          |       |                  | A+ (Superior)  |             |                  |   | 2,533  |       
|Rosemont Reinsurance Ltd.              |       |                  | B (Very Good)  |             |                  |   | 2,221  |       
|Axis Specialty Insurance Company       |       |                  | A (Excellent)  |             |                  |   | 2,189  |       
|Everest Reinsurance Company            |       |                  | A+ (Superior)  |             |                  |   | 2,100  |       
|Shelter Mutual Insurance Company       |       |                  | A (Excellent)  |             |                  |   | 1,864  |       
|Lloyds Syndicate 2010 MMX              |       |                  | A (Excellent)  |             |                  |   | 1,782  |       
|Ace Tempest Reinsurance Ltd.           |       |                  | A+ (Superior)  |             |                  |   | 1,294  |       
|Catlin Insurance Company               |       |                  | A (Excellent)  |             |                  |   | 1,293  |       
|Transatlantic Insurance Company        |       |                  | A+ (Superior)  |             |                  |   | 1,206  |       
|PXRE Reinsurance Company               |       |                  | B+ (Very Good) |             |                  |   | 1,171  |       
|All Other                              |       |                  | B++ or better  |             |                  |   | 10,054 |       
|                                       |       |                  |                  |             |                  |  
|                                       | Total |                  |                  |             |                  |   | $      | 84,883 | 
|                                       |       |                  |                  |             |                  |  






|    |                                                                                          
|--- | -----------------------------------------------------------------------------------------
|(1) | The MCCA and the Florida Hurricane Catastrophe Fund do not
    receive A.M. Best ratings.



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##### Table of Contents









|                                               |  |                                    |  |                                                                               
|---------------------------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------
|Line of Business                               |  | Company Policy Limit               |  | Reinsurance Coverage                                                          
|                                               |  |                                    |  |                                                                               
|Property (all lines except Florida Homeowners) |  | Up to $10.0 million per occurrence |  | Up to $9.75 million (in excess of $250,000) per occurrence                    
|Property (Florida Homeowners)                  |  | Up to $2.0 million per occurrence  |  | Up to $1.5 million (in excess of $500,000) per occurrence                     
|Primary Liability                              |  | Up to $1.0 million per occurrence  |  | Up to $750,000 (in excess of $250,000) per occurrence                         
|Liability  Excess and Umbrella                |  | Up to $4.0 million per occurrence  |  | 95% of up to $3.0 million (in excess of first
    $1.0 million) per occurrence
|Corporate Clash                                |  | Up to $4.0 million per occurrence  |  | Up to $3.0 million (in excess of first $1.0 million)
    per occurrence       













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##### Table of Contents











Ratings






Competition






19



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Regulatory Environment




| |        
| | -------
| | General







| |   |                                                                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | prior approval of the change in control of our company or our
    insurance companies;                                                                                                           
|
| |  | approval of the policy forms and premium rates of our insurance
    companies;                                                                                                                   
|
| |  | standards of solvency, including statutory and risk-based
    capital requirements establishing the minimum amount of capital
    and surplus that must be maintained by our insurance companies;
|
| |  | restrictions concerning which assets of our insurance companies
    are admissible for purposes of calculating their capital and
    surplus;                                                    
|
| |  | licensing of insurers, their agents and various other
    insurance-related entities;                                                                                                            
|
| |  | advertising and marketing practices;                                                                                                                                                             
|
| |  | restrictions on the nature, quality and concentration of the
    investments of our insurance companies;                                                                                         
|
| |  | assessments by guaranty associations;                                                                                                                                                            
|
| |  | restrictions on the ability of our insurance companies to pay
    dividends to North Pointe Financial, our stock holding company
    subsidiary;                                                 
|
| |  | restrictions on transactions between our insurance companies and
    their affiliates;                                                                                                           
|
| |  | restrictions on the size of risks insurable under a single
    policy;                                                                                                                           
|
| |  | rules requiring deposits for the benefit of policyholders;                                                                                                                                       
|
| |  | rules requiring certain methods of accounting;                                                                                                                                                   
|
| |  | periodic examinations of our operations and finances;                                                                                                                                            
|
| |  | claims practices;                                                                                                                                                                                
|
| |  | rules prescribing the form and content of records of financial
    condition required to be filed; and                                                                                           
|
| |  | rules requiring adequate reserves for unearned premium, losses
    and loss expense, or for other purposes.                                                                                      



| |          
| | ---------
| | Dividends



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##### Table of Contents



Capital
Constraints 10-K.




| |                                                                                
| | -------------------------------------------------------------------------------
| | Insolvency Funds and Associations; Mandatory Pools and
    Insurance Facilities

















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| |            
| | -----------
| | IRIS Ratios





|                       |  |             |               |  |                              |  |       |  
|---------------------- |  | ----------- | ------------- |  | ---------------------------- |  | ----- | -
|Ratio                  |  | Usual Range |               |  | North Pointe Insurance Ratio | 
|                       |  |             |               |  |                              | 
|Change in net writings |  |             | +33% to  -33% |  |                              |  | -37.0 | %





|                                 |  |             |              |  |                             |  |      | 
|-------------------------------- |  | ----------- | ------------ |  | --------------------------- |  | ---- | 
|Ratio                            |  | Usual Range |              |  | North Pointe Casualty Ratio | 
|                                 |  |             |              |  |                             | 
|Change in net writings           |  |             | +33% to -33% |  |                             |  | 460% | 
|Two-year overall operating ratio |  |             | +100% to n/a |  |                             |  | 113% | 
|Gross change in surplus          |  |             | +50% to -10% |  |                             |  | -15% | 
|Net change in adjusted surplus   |  |             | +25% to -10% |  |                             |  | -53% | 





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##### Table of Contents







| |                                     
| | ------------------------------------
| | Captive Insurance Company Regulation





Employees




Available Information


www.sec.gov 1-800-SEC-0330.


10-K, 10-Q, 8-K, http://www.npte.com/


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##### Table of Contents





|         |              
|-------- | -------------
|Item 1A. | RISK FACTORS.

Our success depends on our ability to price accurately the
risks we underwrite.






| |   |                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------
| |  | the availability of sufficient reliable data and our ability to
    properly analyze available data;
|
| |  | the uncertainties that inherently characterize estimates and
    assumptions;                       
|
| |  | our selection and application of appropriate pricing
    techniques; and                            
|
| |  | changes in applicable legal liability standards and in the civil
    litigation system generally.   





Our results and financial condition may be adversely affected
by our failure to establish adequate loss and loss adjustment
expense reserves.


10-K.


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##### Table of Contents



We depend upon our network of independent agents for revenues
and market opportunities, and our business may not continue to
grow and may be materially and adversely affected if we cannot
retain existing, and attract new, independent agents.






Our failure to pay claims accurately could adversely affect
our business, results of operations and capital.




Our financial results may be adversely affected by conditions
in the states where our business is concentrated.




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##### Table of Contents



We have a limited history writing homeowners insurance
policies to homeowners in Florida, and our Florida homeowners
business may not perform as we expect, which could adversely
affect our business and financial condition.




Implementation of our growth strategies is subject to
numerous risks and difficulties.






| |   |                                                                                                          
| | - | ---------------------------------------------------------------------------------------------------------
| |  | identify, recruit and integrate new independent agents;                                                  
|
| |  | properly design and price new and existing products and programs;                                        
|
| |  | identify profitable new geographic markets and product lines to
    enter;                               
|
| |  | obtain necessary licenses;                                                                               
|
| |  | identify acquisition candidates and successfully execute and
    integrate acquisitions we undertake; and
|
| |  | identify, hire and train new underwriting and claims handling
    employees.                             





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##### Table of Contents



If market conditions cause reinsurance to be more costly or
unavailable, we may be required to bear increased risks or
reduce the level of our underwriting commitment.










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##### Table of Contents







Assessments and other surcharges for guaranty funds and
mandatory reinsurance arrangements may reduce our
profitability.


Membership in Insolvency Funds and
Associations; Mandatory Pools and Insurance Entities 10-K.


Severe weather conditions and other catastrophes may result
in an increase in the number and amount of claims that we
incur.




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##### Table of Contents







Our business is cyclical, which affects our financial
performance and may affect the market price of our common
stock.




Our business is seasonal, which affects our financial
performance and may affect the market price of our common
stock.




Intense competition could adversely affect our results of
operations.




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##### Table of Contents



If we lose key personnel or are unable to recruit additional
qualified personnel, our ability to implement our growth
strategies could be hindered.




The success of certain of our product lines, including our
bowling center insurance product line, depends upon our receipt
of trade association endorsements, and we may not be able to
retain existing endorsements or secure new endorsements.




As a holding company, we depend on payments from our
subsidiaries to satisfy our financial obligations.




Our insurance company subsidiaries are subject to regulatory
and other restrictions limiting their ability to pay dividends
to us.






30



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##### Table of Contents





We are subject to comprehensive regulation that poses
particular risks to our ability to earn profits.








| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Required licensing. Our insurance company subsidiaries
    operate under licenses issued by various state insurance
    agencies. If a regulatory authority were to deny or delay
    granting a new license, our ability to enter that market quickly
    or offer new insurance products in that market would be
    substantially impaired. For example, we have been experiencing
    difficulty in obtaining a surplus lines license in the state of
    New York for North Pointe Insurance due to its current A.M. Best
    rating.                                                                                                                                                                                                                                                                                                             
|
| |  | Regulation of insurance rates and approval of policy
    forms. The insurance laws of most states in which we operate
    require insurance companies to file insurance rate schedules and
    policy forms for review and approval. If rate increases we deem
    necessary are not approved by a state insurance agency, we may
    not be able to respond to market developments and increased
    costs in that state. For example, we exited the California
    non-standard automobile insurance market beginning in 2001 due
    principally to difficulties in obtaining regulatory approval of
    desired rate increases. Likewise, if insurance policy forms we
    seek to use are not approved by a state insurance agency, our
    ability to offer new products and grow our business in that
    state would be substantially impaired.
|
| |  | Restrictions on cancellation, non-renewal or withdrawal.
    Many states have laws and regulations restricting an insurance
    companys ability to cease or significantly reduce its
    sales of certain types of insurance in that state. These laws
    and regulations could limit our ability to exit or reduce our
    business in unprofitable markets or discontinue unprofitable
    products. For example, we experienced difficulty in exiting the
    California non-standard automobile insurance market in a timely
    manner due to regulatory constraints on our ability to cease
    renewing existing policies.                                                                                                                                                                                                                   
|
| |  | Transactions between insurance companies and their
    affiliates. Transactions between our subsidiary insurance
    companies and their affiliates generally must be disclosed
    to  and in some cases approved by  state
    insurance agencies. State insurance agencies may refuse to
    approve or delay their approval of a transaction, which may
    impact our ability to innovate or operate efficiently.                                                                                                                                                                                                                                                                                                                                                                                                                               



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We are subject to other state laws and regulations that
impose additional administrative burdens and risks that may also
affect our ability to earn profits.






| |   |                                                                                                                                                                                                                                                                                                                                                                                                                 
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the use of non-public consumer information and related privacy
    issues;                                                                                                                                                                                                                                                                                                                                      
|
| |  | the use of credit history in underwriting and rating;                                                                                                                                                                                                                                                                                                                                                           
|
| |  | limitations on the ability to charge policy fees;                                                                                                                                                                                                                                                                                                                                                               
|
| |  | limitations on types and amounts of investments;                                                                                                                                                                                                                                                                                                                                                                
|
| |  | the payment of dividends;                                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | the acquisition or disposition of an insurance company or of any
    company controlling an insurance company;                                                                                                                                                                                                                                                                                                  
|
| |  | involuntary assignments of high-risk policies, participation in
    reinsurance facilities and underwriting associations,
    assessments and other governmental charges;                                                                                                                                                                                                                                       
|
| |  | reporting with respect to financial condition;                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | periodic financial and market conduct examinations performed by
    state insurance department examiners; and                                                                                                                                                                                                                                                                                                   
|
| |  | with respect to our premium finance business, the federal
    Truth-in-Lending Act
    and similar state statutes. In states where premium finance
    statutes have not been enacted, we generally are subject to
    state usury laws that are applicable to consumer loans. State
    usury laws may limit the amount of interest we are allowed to
    charge our premium finance customers in these states.



Our insurance company subsidiaries, our premium finance
subsidiary and our captive reinsurance subsidiary are subject to
minimum capital and surplus requirements, and our failure to
meet these requirements could subject us to regulatory
action.






32



---



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A reduction in our insurance company subsidiaries A.M.
Best financial strength ratings could adversely affect our
business and financial condition.




We could incur significant losses or a shortage of liquidity
if our reinsurers are unable to pay or do not pay our claims
timely.




The outcome of current industry investigations and regulatory
proposals could adversely affect our financial condition and
results of operations.




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We may be subject to risks associated with our continued use
of contingent commission arrangements with independent agents in
Florida.






Changes in regulation could adversely affect our business.






Adverse securities market conditions could have a significant
and negative impact on our investment portfolio.




34



---



##### Table of Contents





We rely on our information technology and telecommunications
systems, and the failure or disruption of these systems could
disrupt our operations and adversely affect our results of
operations.




Our failure to implement and maintain adequate internal
controls in our business could have a material adverse effect on
our business, financial condition, results of operations and
stock price.






10-K.


Failure to manage effectively the costs and administrative
burdens of being a newly public company would adversely affect
our business and results of operations.




35



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|        |            
|------- | -----------
|Item 2. | PROPERTIES.







|        |                   
|------- | ------------------
|Item 3. | LEGAL PROCEEDINGS.





|        |                                                         
|------- | --------------------------------------------------------
|Item 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY
    HOLDERS.



36



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PART II




|        |                                                                                                                         
|------- | ------------------------------------------------------------------------------------------------------------------------
|Item 5. | MARKET FOR REGISTRANTS COMMON EQUITY, RELATED
    STOCKHOLDER 
     MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES.





|                   |  |                   |       |  |     |   |       |           |  |   |   | 
|------------------ |  | ----------------- | ----- |  | --- | - | ----- | --------- |  | - | - | 
|                   |  | Market Quotations
|                   |  |                  
|2005 Quarter Ended |  | High              |       |  | Low |   |       | Dividends
|                   |  |                   |       |  |     |   |       |          
|September 30       |  | $                 | 12.45 |  |     | $ | 11.60 |           |  | $ |  | 
|                   |  |                   |       |  |     |   |       |           | 
|December 31        |  | $                 | 15.90 |  |     | $ | 11.15 |           |  | $ |  | 
|                   |  |                   |       |  |     |   |       |           | 







S-1 333-122220)






S-1 333-122220),


37



---



##### Table of Contents







|        |                         
|------- | ------------------------
|Item 6. | SELECTED FINANCIAL DATA.





10-K.


38



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##### Table of Contents



North Pointe Holdings Corporation and Predecessor


Five Year Selected Financial Data


|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |        |        | 
|------------------------------------------------------------------------------------- | --------------------------------------------- | ------------------------------------------------------- | ------- | ------------- | --------------------- | - | ------------- | -------- | ------ | ------------- | ------------ | ------ | ------ | ---- | ------- | ------ | ------ | - | ------- | ------ | ------ | - | ------- | ------ | ------ | 
|                                                                                      |                                               | North Pointe Holdings Corporation                       |         |               | Predecessor Companies |  
|                                                                                      |                                               |                                                         |         |               |                       |  
|                                                                                      |                                               |                                                         |         | As of and for |                       |   |              
|                                                                                      |                                               |                                                         |         | the Period    |                       |   |              
|                                                                                      |                                               |                                                         |         | from          |                       |   | As of and for |          |        | As of and for |             
|                                                                                      |                                               |                                                         |         | June 26, 2002 |                       |   | the Period    |          |        | the Year      |             
|                                                                                      |                                               | As of and for the Year Ended                            |         |               | through               |   |               | Ended    |        |               | Ended        |       
|                                                                                      |                                               | December 31,                                            |         |               | December 31,          |   |               | June 25, |        |               | December 31, |       
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |       
|                                                                                      |                                               | 2005(1)                                                 |         |               | 2004(2)               |   |               | 2003     |        |               | 2002         |        |        | 2002 |         |        | 2001   |  
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|                                                                                      |                                               | (Dollars in thousands, except per share and ratio data) |        
|Statements of Operations Data:                                                        |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|Revenues:                                                                             |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|                                                                                      | Direct premiums written                       |                                                         | $       | 111,483       |                       |   | $             | 94,548   |        |               | $            | 88,036 |        |      | $       | 38,757 |        |   | $       | 38,667 |        |   | $       | 76,113 |       
|                                                                                      | Assumed premiums written                      |                                                         |         | 613           |                       |   |               | 1,913    |        |               |              | 167    |        |      |         | 73     |        |   |         | 154    |        |   |         | 11,775 | (3)   
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|                                                                                      | Gross premiums written                        |                                                         |         | 112,096       |                       |   |               | 96,461   |        |               |              | 88,203 |        |      |         | 38,830 |        |   |         | 38,821 |        |   |         | 87,888 |       
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|                                                                                      | Net premiums written                          |                                                         |         | 87,133        |                       |   |               | 80,493   |        |               |              | 76,224 |        |      |         | 29,674 |        |   |         | 30,023 |        |   |         | 73,597 |       
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|                                                                                      | Net premiums earned                           |                                                         | $       | 84,736        |                       |   | $             | 76,957   |        |               | $            | 68,740 |        |      | $       | 23,815 |        |   | $       | 31,078 |        |   | $       | 63,382 |       
|                                                                                      | Investment income, net of investment expenses |                                                         |         | 4,003         |                       |   |               | 2,377    |        |               |              | 2,174  |        |      |         | 1,452  |        |   |         | 1,822  |        |   |         | 4,641  |       
|                                                                                      | Net realized capital gains (losses)           |                                                         |         | (168          | )                     |   |               | 886      |        |               |              | 1,264  |        |      |         | 976    |        |   |         | (108   | )      |   |         | 2,542  |       
|                                                                                      | Fees and other income                         |                                                         |         | 1,903         |                       |   |               | 2,222    |        |               |              | 2,047  |        |      |         | 1,155  |        |   |         | 1,424  |        |   |         | 4,095  |       
|                                                                                      | Gains on sales of businesses(4)               |                                                         |         |              |                       |   |               | 4,285    |        |               |              | 200    |        |      |         |       |        |   |         |       |        |   |         |       |       
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|                                                                                      |                                               | Total revenues                                          |         |               | 90,474                |   |               |          | 86,727 |               |              |        | 74,425 |      |         |        | 27,398 |   |         |        | 34,216 |   |         |        | 74,660 | 
|Expenses:                                                                             |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|                                                                                      | Loss and loss adjustment expenses, net        |                                                         |         | 44,003        |                       |   |               | 41,503   |        |               |              | 33,141 |        |      |         | 14,827 |        |   |         | 17,712 |        |   |         | 45,267 |       
|                                                                                      | Policy acquisition costs                      |                                                         |         | 21,779        |                       |   |               | 18,687   |        |               |              | 17,409 |        |      |         | 1,640  |        |   |         | 7,584  |        |   |         | 16,039 |       
|                                                                                      | Other underwriting and operating expenses     |                                                         |         | 17,855        |                       |   |               | 13,730   |        |               |              | 13,159 |        |      |         | 6,345  |        |   |         | 9,362  |        |   |         | 12,798 |       
|                                                                                      | Interest expense                              |                                                         |         | 959           |                       |   |               | 763      |        |               |              | 422    |        |      |         | 329    |        |   |         | 28     |        |   |         | 67     |       
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|                                                                                      |                                               | Total expenses                                          |         |               | 84,596                |   |               |          | 74,683 |               |              |        | 64,131 |      |         |        | 23,141 |   |         |        | 34,686 |   |         |        | 74,171 | 
|Equity in loss of affiliate                                                           |                                               |                                                         |        |               |                       |   |              |          |        |               |             |        |        |      |        |        |        |   |        |        |        |   | (552    | )     
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|Income (loss) before federal income tax expense (benefit) and
    extraordinary items |                                               |                                                         | 5,878   |               |                       |   | 12,044        |          |        |               | 10,294       |        |        |      | 4,257   |        |        |   | (470    | )      |        |   | (63     | )     
|Federal income tax expense (benefit)                                                  |                                               |                                                         | 2,028   |               |                       |   | 3,516         |          |        |               | 3,725        |        |        |      | 1,451   |        |        |   | (69     | )      |        |   | (554    | )     
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|Income (loss) before extraordinary items                                              |                                               |                                                         | 3,850   |               |                       |   | 8,528         |          |        |               | 6,569        |        |        |      | 2,806   |        |        |   | (401    | )      |        |   | 491     |       
|Extraordinary items(5)                                                                |                                               |                                                         |        |               |                       |   | 2,905         |          |        |               |             |        |        |      | 10,860  |        |        |   |        |        |        |   |        |       
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|Net income (loss)                                                                     |                                               | $                                                       | 3,850   |               |                       | $ | 11,433        |          |        | $             | 6,569        |        |        | $    | 13,666  |        |        | $ | (401    | )      |        | $ | 491     |       
|                                                                                      |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |  
|Earnings Per Share Data:                                                              |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|Income before extraordinary items:                                                    |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|                                                                                      | Basic                                         |                                                         | $       | 0.64          |                       |   | $             | 1.50     |        |               | $            | 1.16   |        |      | $       | 0.96   |        |   | $       |       |        |   | $       |       |       
|                                                                                      | Diluted                                       |                                                         |         | 0.64          |                       |   |               | 1.46     |        |               |              | 0.90   |        |      |         | 0.75   |        |   |         |       |        |   |         |       |       
|Net income:                                                                           |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|                                                                                      | Basic                                         |                                                         |         | 0.64          |                       |   |               | 2.07     |        |               |              | 1.16   |        |      |         | 4.76   |        |   |         |       |        |   |         |       |       
|                                                                                      | Diluted                                       |                                                         |         | 0.64          |                       |   |               | 1.95     |        |               |              | 0.90   |        |      |         | 3.63   |        |   |         |       |        |   |         |       |       
|Balance Sheet Data:                                                                   |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|Cash and investments                                                                  |                                               | $                                                       | 142,891 |               |                       | $ | 115,226       |          |        | $             | 99,431       |        |        | $    | 93,596  |        |        | $ | 89,964  |        |        | $ | 93,384  |       
|Total assets                                                                          |                                               |                                                         | 275,036 |               |                       |   | 205,079       |          |        |               | 165,433      |        |        |      | 165,191 |        |        |   | 165,680 |        |        |   | 171,301 |       
|Losses and loss adjustment expenses                                                   |                                               |                                                         | 117,778 |               |                       |   | 96,561        |          |        |               | 76,319       |        |        |      | 82,949  |        |        |   | 84,197  |        |        |   | 87,201  |       
|Debt                                                                                  |                                               |                                                         | 5,026   |               |                       |   | 20,062        |          |        |               | 10,848       |        |        |      | 12,313  |        |        |   | 1,060   |        |        |   | 1,289   |       
|Total liabilities                                                                     |                                               |                                                         | 192,809 |               |                       |   | 170,387       |          |        |               | 137,340      |        |        |      | 142,525 |        |        |   | 131,905 |        |        |   | 134,278 |       
|Redeemable preferred stock                                                            |                                               |                                                         |        |               |                       |   |              |          |        |               | 2,000        |        |        |      | 2,000   |        |        |   |        |        |        |   |        |       
|Shareholders equity                                                                  |                                               |                                                         | 82,227  |               |                       |   | 34,692        |          |        |               | 26,093       |        |        |      | 20,666  |        |        |   | 33,775  |        |        |   | 37,023  |       
|Combined statutory capital and surplus(6)                                             |                                               |                                                         | 69,736  |               |                       |   | 47,900        |          |        |               | 29,706       |        |        |      | 29,107  |        |        |   | 22,352  |        |        |   | 22,274  |       
|Book value per share(7)                                                               |                                               | $                                                       | 9.02    |               |                       | $ | 7.10          |          |        | $             | 5.01         |        |        | $    | 3.74    |        |        |   |        |        |        |   |        |       
|Key Financial Ratios:                                                                 |                                               |                                                         |         |               |                       |   |               |          |        |               |              |        |        |      |         |        |        |   |         |        |        |   |         |       
|Loss ratio(8)                                                                         |                                               |                                                         | 50.8    | %             |                       |   | 52.4          | %        |        |               | 46.8         | %      |        |      | 59.4    | %      |        |   | 54.5    | %      |        |   | 67.1    | %     
|Expense ratio(9)                                                                      |                                               |                                                         | 45.7    |               |                       |   | 41.0          |          |        |               | 43.2         |        |        |      | 32.0    |        |        |   | 52.1    |        |        |   | 42.7    |       
|Combined ratio(10)                                                                    |                                               |                                                         | 96.5    |               |                       |   | 93.4          |          |        |               | 90.0         |        |        |      | 91.4    |        |        |   | 106.6   |        |        |   | 109.8   |       

39



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| |     |                                                                                                                                                                                                                                                                                                                                                                                    
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Of our gross premiums written in 2005, $28.7 million was
    attributable to our new Florida homeowners business. We expect
    that a significant component of our gross premiums written
    relating to this business will continue to occur in the first
    quarter of every year, but these premiums will be earned over
    the respective terms of the individual policies.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our results of the year ended December 31, 2005 include
    $14.8 million of pre-tax expenses ($9.8 million after
    tax) related to four hurricanes that struck Florida and the Gulf
    coast in 2005. Of this $14.8 million, $11.8 million
    was attributable to losses and loss adjustment expenses related
    to policyholder claims (after the effect of reinsurance). The
    remaining $3.0 million of the $14.8 million in
    hurricane related expenses was attributable to additional
    reinsurance costs, or reinstatement premiums, we incurred
    relating to our catastrophe reinsurance coverage after each
    hurricane, which costs were recorded as a reduction in our net
    premiums earned. Our loss ratio increased from 35.7% to 50.8% as
    a result of these hurricanes.



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | Our results for the year ended December 31, 2004 include
    $7.3 million of pre-tax expenses ($4.8 million after
    tax) related to four hurricanes that struck Florida in 2004. Of
    this $7.3 million, $6.2 million was attributable to
    losses and loss adjustment expenses related to policyholder
    claims (after the effect of reinsurance). The remaining
    $1.1 million of the $7.3 million in hurricane-related
    expenses was attributable to additional reinsurance costs we
    incurred relating to our catastrophe reinsurance coverage after
    each hurricane, which costs were recorded as a reduction in our
    net premiums earned. Our loss ratio increased from 44.0% to
    52.4% as a result of these hurricanes.
|
| | (3) | Our assumed premiums written for the year ended
    December 31, 2001 includes $6.7 million of
    non-recurring assumed premiums written related to our
    acquisition of the renewal rights to the book of business that
    we acquired in January 2001 from Queensway International
    Indemnity Company, or Queensway International.                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | (4) | The gains on sales of businesses in 2004 was generated by a
    $4.0 million gain on the sale of the renewal policy rights
    relating to our non-standard personal automobile insurance line
    and a $285,000 gain on the sale of our renewal rights relating
    to approximately 100 liquor liability policies. The $200,000
    gain on sales of businesses in 2003 was generated by a gain on
    the sale of Universal Fire & Casualty.                                                                                                                                                                                                                                                                                                       
|
| | (5) | Extraordinary items reflect income generated through the
    recognition of negative goodwill resulting from acquisitions of
    companies purchased for less than the aggregate fair value of
    their net assets. We acquired Queensway International
    (subsequently renamed North Pointe Casualty Insurance Company)
    on February 28, 2004 for $11.0 million, resulting in
    an extraordinary gain of $2.9 million. We acquired the
    Predecessor Companies on June 26, 2002 for
    $23.0 million, resulting in an extraordinary gain of
    $10.9 million.                                                                                                                                                                             
|
| | (6) | In 2005, we contributed a total of $24.9 million into our
    insurance company subsidiaries, net of dividends received of
    which $6.8 million, $5.6 million, $7.5 million
    and $5.0 million was contributed to North Pointe Insurance,
    North Pointe Casualty, Home Pointe Insurance and Midfield,
    respectively. These contributions were funded from initial
    public offering proceeds, holding company funds and new debt.                                                                                                                                                                                                                                                                                                          



| |                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | As of December 31, 2004, combined statutory capital and
    surplus included $15.0 million for North Pointe Casualty,
    which was acquired in February 2004 utilizing a combination of
    holding company funds and new debt.



| |     |                                                                                                                                                                                          
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (7) | Book value per share equals the quotient obtained by dividing
    shareholders equity by the number of shares of common
    stock outstanding.                                          
|
| | (8) | Loss ratio is the ratio (expressed as a percentage) of losses
    and loss adjustment expenses incurred divided by the sum of net
    premiums earned, installment fees and other income.
|
| | (9) | Expense ratio is the ratio (expressed as a percentage) of
    commissions and operating expenses divided by the sum of net
    premiums earned, installment fees and other income.       



|     |                                                                       
|---- | ----------------------------------------------------------------------
|(10) | Combined ratio is the sum of the loss ratio and the expense
    ratio.

40



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|        |                                                                                           
|------- | ------------------------------------------------------------------------------------------
|Item 7. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
    CONDITION AND RESULTS OF OPERATIONS.

The discussion and analysis of our financial condition and
results of operations contained herein should be read in
conjunction with our consolidated financial statements and
accompanying notes which appear elsewhere in this report. It
contains forward-looking statements that involve risks and
uncertainties. Please see Note on Forward-Looking
Statements for more information. Our actual results could
differ materially from those anticipated in these
forward-looking statements as a result of various factors,
including those discussed below and elsewhere in this report.


Note on Forward-Looking Statements






| |   |                                                                                                                                                                                                                             
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | our ability to accurately price the risks it underwrites;                                                                                                                                                                   
|
| |  | the establishment of adequate loss and loss adjustment expense
    reserves;                                                                                                                                                
|
| |  | retention and recruiting of independent agents and the potential
    loss of key personnel;                                                                                                                                 
|
| |  | failure to pay claims accurately;                                                                                                                                                                                           
|
| |  | risks associated with high concentration of our business in
    certain geographic markets;                                                                                                                                 
|
| |  | inability to implement our growth strategies;                                                                                                                                                                               
|
| |  | possible assessments for guaranty funds, other insurance-related
    assessments and mandatory reinsurance arrangements and our
    ability to recover such assessments through future surcharges or
    other rate changes;
|
| |  | the occurrence of severe weather conditions and other
    catastrophes;                                                                                                                                                     
|
| |  | the cyclical and seasonal nature of the industries within which
    we operate;                                                                                                                                             
|
| |  | intense competition with other insurance companies;                                                                                                                                                                         
|
| |  | our ability to obtain and retain trade association endorsements;                                                                                                                                                            
|
| |  | performance of our various operating subsidiaries and
    restrictions that may limit the ability of our subsidiaries to
    pay dividends to North Pointe Holdings;                                                        
|
| |  | existing and future regulations by the local, state and federal
    governments;                                                                                                                                            
|
| |  | the compliance of our insurance company subsidiaries with
    minimum capital and surplus requirements;                                                                                                                     
|
| |  | ratings of our insurance company subsidiaries by A.M. Best;                                                                                                                                                                 
|
| |  | the availability and pricing of reinsurance and the potential
    for non-payment or delay in payment by reinsurers;                                                                                                        
|
| |  | the outcome of current industry investigations and potential
    regulation limiting the use of undisclosed contingent commission
    arrangements with independent agents;                                                 
|
| |  | adverse market conditions that could negatively impact our
    investment portfolio;                                                                                                                                        

41



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| |   |                                                                                                                                                                                                                                   
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | reliance on information technology and telecommunication systems;                                                                                                                                                                 
|
| |  | our limited history writing homeowners insurance policies to
    homeowners in Florida;                                                                                                                                           
|
| |  | changes in insurance-related laws and regulations;                                                                                                                                                                                
|
| |  | our ability to implement and maintain adequate internal controls
    in our business;                                                                                                                                             
|
| |  | managements ability to effectively manage a public
    company; and                                                                                                                                                              
|
| |  | other risks that we identify in past and future filings with the
    Securities and Exchange Commission, including without limitation
    the risks described herein, and in future filings, under the
    caption Risk Factors.

10-K


Overview
















42



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Critical Accounting Estimates






| |                                                                   
| | ------------------------------------------------------------------
| | Estimation of Unpaid Loss and Loss Adjustment Expense
    Reserves









43



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10-K.




| |                                               
| | ----------------------------------------------
| | Other-Than-Temporary Impairment of Investments











10-K.




| |                                  
| | ---------------------------------
| | Fair Value of Net Assets Acquired



44



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10-K.


45



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| |                      
| | ---------------------
| | Results of Operations



|                                                                 |                                           |                                   |       |        |         |   |        |        |        |   |        |        |        | 
|---------------------------------------------------------------- | ----------------------------------------- | --------------------------------- | ----- | ------ | ------- | - | ------ | ------ | ------ | - | ------ | ------ | ------ | 
|                                                                 |                                           | North Pointe Holdings Corporation |      
|                                                                 |                                           |                                   |      
|                                                                 |                                           | Years Ended December 31,          |      
|                                                                 |                                           |                                   |      
|                                                                 |                                           | 2005                              |       |        | 2004    |   |        | 2003   |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|                                                                 |                                           | (Dollars in thousands,            |      
|                                                                 |                                           | except ratio data)                |      
|Gross premiums written:                                          |                                           |                                   |       |        |         |   |        |        |        |   |        |       
|                                                                 | Commercial lines                          |                                   | $     | 78,551 |         |   | $      | 73,387 |        |   | $      | 59,778 |       
|                                                                 | Personal lines                            |                                   |       | 33,545 |         |   |        | 23,074 |        |   |        | 28,425 |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|                                                                 |                                           | Total gross premiums written      |       |        | 112,096 |   |        |        | 96,461 |   |        |        | 88,203 | 
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|Net premiums written:                                            |                                           |                                   |       |        |         |   |        |        |        |   |        |       
|                                                                 | Commercial lines                          |                                   |       | 63,289 |         |   |        | 61,394 |        |   |        | 51,930 |       
|                                                                 | Personal lines                            |                                   |       | 23,844 |         |   |        | 19,099 |        |   |        | 24,294 |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|                                                                 |                                           | Total net premiums written        |       |        | 87,133  |   |        |        | 80,493 |   |        |        | 76,224 | 
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|Revenues:                                                        |                                           |                                   |       |        |         |   |        |        |        |   |        |       
|                                                                 | Net premiums earned                       |                                   |       | 84,736 |         |   |        | 76,957 |        |   |        | 68,740 |       
|                                                                 | Investment income, net                    |                                   |       | 4,003  |         |   |        | 2,377  |        |   |        | 2,174  |       
|                                                                 | Net realized capital (losses) gains       |                                   |       | (168   | )       |   |        | 886    |        |   |        | 1,264  |       
|                                                                 | Fees and other income                     |                                   |       | 1,903  |         |   |        | 2,222  |        |   |        | 2,047  |       
|                                                                 | Gains on sales of businesses              |                                   |       |       |         |   |        | 4,285  |        |   |        | 200    |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|                                                                 |                                           | Total revenues                    |       |        | 90,474  |   |        |        | 86,727 |   |        |        | 74,425 | 
|Expenses:                                                        |                                           |                                   |       |        |         |   |        |        |        |   |        |       
|                                                                 | Losses and loss adjustment expenses, net  |                                   |       | 44,003 |         |   |        | 41,503 |        |   |        | 33,141 |       
|                                                                 | Policy acquisition costs                  |                                   |       | 21,779 |         |   |        | 18,687 |        |   |        | 17,409 |       
|                                                                 | Other underwriting and operating expenses |                                   |       | 17,855 |         |   |        | 13,730 |        |   |        | 13,159 |       
|                                                                 | Interest expenses                         |                                   |       | 959    |         |   |        | 763    |        |   |        | 422    |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|                                                                 |                                           | Total expenses                    |       |        | 84,596  |   |        |        | 74,683 |   |        |        | 64,131 | 
|Income before federal income tax expense and extraordinary items |                                           |                                   | 5,878 |        |         |   | 12,044 |        |        |   | 10,294 |       
|Federal income tax expense                                       |                                           |                                   | 2,028 |        |         |   | 3,516  |        |        |   | 3,725  |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|Income before extraordinary items                                |                                           |                                   | 3,850 |        |         |   | 8,528  |        |        |   | 6,569  |       
|Extraordinary items                                              |                                           |                                   |      |        |         |   | 2,905  |        |        |   |       |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|Net income                                                       |                                           | $                                 | 3,850 |        |         | $ | 11,433 |        |        | $ | 6,569  |       
|                                                                 |                                           |                                   |       |        |         |   |        |        |       
|Loss ratio:                                                      |                                           |                                   |       |        |         |   |        |        |        |   |        |       
|                                                                 | Commercial lines                          |                                   |       | 47.8   | %       |   |        | 50.9   | %      |   |        | 39.6   | %     
|                                                                 | Personal lines                            |                                   |       | 62.5   |         |   |        | 61.7   |        |   |        | 65.0   |       
|                                                                 | Consolidated                              |                                   |       | 50.8   |         |   |        | 52.4   |        |   |        | 46.8   |       
|Expense ratio                                                    |                                           |                                   | 45.7  |        |         |   | 41.0   |        |        |   | 43.2   |       
|Combined ratio                                                   |                                           |                                   | 96.5  |        |         |   | 93.4   |        |        |   | 90.0   |       

46



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| |                       
| | ----------------------
| | Gross Premiums Written



Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.






Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.










47



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| |                     
| | --------------------
| | Net Premiums Written

10-K.


Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.




Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.






| |                    
| | -------------------
| | Net Premiums Earned



48



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Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.


Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.




| |                      
| | ---------------------
| | Net Investment Income



Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.




Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.






| |                                           
| | ------------------------------------------
| | Net Realized (Losses) Gains on Investments



Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.


49



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Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.




| |                      
| | ---------------------
| | Fees and Other Income



Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.


Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.




| |                             
| | ----------------------------
| | Gains on Sales of Businesses







| |                                    
| | -----------------------------------
| | Losses and Loss Adjustment Expenses



50



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10-K.


Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.






|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          |  |   |     |     |  |   |       |        | 
|----------------------------------------- | ---------------- | ---------------------- | - | --------- | --------- |  | ----- | ---------- | ----- | ---------- | ----- | --- | --- | ------ | - | ----- | -------- |  | - | --- | --- |  | - | ----- | ------ | 
|                                          |                  |                        |   |           |           |  |       |            |       | Changes in |       |     |    
|                                          |                  |                        |   | Estimates |           |  | Total |           
|                                          |                  | Hurricanes             |   |           | of 2004   |  |       | Hurricane- |      
|                                          |                  |                        |   |           | Hurricane |  |       | Related    |      
|For the Year Ended December 31, 2005      |                  | Dennis                 |   |           | Katrina   |  |       | Rita       |       |            | Wilma |     |     | Losses |   |       | Expenses | 
|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          | 
|                                          |                  | (Dollars in thousands) |  
|Losses and loss adjustment expenses, net  |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          |  |   |     |     |  |   |      
|                                          | Commercial lines |                        | $ | 35        |           |  | $     | 1,280      |       |            | $     | 290 |     |        | $ | 3,200 |          |  | $ | 134 |     |  | $ | 4,939 |       
|                                          | Personal lines   |                        |   | 2,330     |           |  |       | 1,649      |       |            |       | 7   |     |        |   | 3,000 |          |  |   |    |     |  |   | 6,986 |       
|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          | 
|                                          |                  | Total                  |   | $         | 2,365     |  |       | $          | 2,929 |            |       | $   | 297 |        |   | $     | 6,200    |  |   | $   | 134 |  |   | $     | 11,925 | 
|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          | 
|Reinstatement charges                     |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          |  |   |     |     |  |   |      
|                                          | Commercial lines |                        | $ |          |           |  | $     |           |       |            | $     |    |     |        | $ | 1,731 |          |  | $ | 40  |     |  | $ | 1,771 |       
|                                          | Personal lines   |                        |   |          |           |  |       |           |       |            |       |    |     |        |   | 1,319 |          |  |   |    |     |  |   | 1,319 |       
|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          | 
|                                          |                  | Total                  |   | $         |          |  |       | $          |      |            |       | $   |    |        |   | $     | 3,050    |  |   | $   | 40  |  |   | $     | 3,090  | 
|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          | 
|Total expenses attributable to hurricanes |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          |  |   |     |     |  |   |      
|                                          | Commercial lines |                        | $ | 35        |           |  | $     | 1,280      |       |            | $     | 290 |     |        | $ | 4,931 |          |  | $ | 174 |     |  | $ | 6,710 |       
|                                          | Personal lines   |                        |   | 2,330     |           |  |       | 1,649      |       |            |       | 7   |     |        |   | 4,319 |          |  |   |    |     |  |   | 8,305 |       
|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          | 
|                                          |                  | Total                  |   | $         | 2,365     |  |       | $          | 2,929 |            |       | $   | 297 |        |   | $     | 9,250    |  |   | $   | 174 |  |   | $     | 15,015 | 
|                                          |                  |                        |   |           |           |  |       |            |       |            |       |     |     |        |   |       |          | 

|                                         |       |                        |       |       |            |   |       |       |  |   |        |     |  |          |       |       |  |   |       |       | 
|---------------------------------------- | ----- | ---------------------- | ----- | ----- | ---------- | - | ----- | ----- |  | - | ------ | --- |  | -------- | ----- | ----- |  | - | ----- | ----- | 
|                                         |       |                        |       | Total |           
|                                         |       | Hurricanes             |       |       | Hurricane- |  
|                                         |       |                        |       |       | Related    |  
|For the Year Ended December 31, 2004     |       | Charlie                |       |       | Francis    |   |       | Ivan  |  |   | Jeanne |     |  | Expenses |      
|                                         |       |                        |       |       |            |   |       |       |  |   |        |     |  |          |      
|                                         |       | (Dollars in thousands) |      
|Commercial lines                         |       |                        |       |       |            |   |       |       |  |   |        |     |  |          |       |       |  |   |       |      
|Losses and loss adjustment expenses, net |       | $                      | 2,000 |       |            | $ | 2,000 |       |  | $ | 216    |     |  | $        | 2,000 |       |  | $ | 6,216 |      
|Reinstatement charges                    |       |                        | 681   |       |            |   | 362   |       |  |   |       |     |  |          | 57    |       |  |   | 1,100 |      
|                                         |       |                        |       |       |            |   |       |       |  |   |        |     |  |          |      
|                                         | Total |                        | $     | 2,681 |            |   | $     | 2,362 |  |   | $      | 216 |  |          | $     | 2,057 |  |   | $     | 7,316 | 
|                                         |       |                        |       |       |            |   |       |       |  |   |        |     |  |          |      

51



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|                                                                                            |  |      |      |   |      |  |      |      |  |  |       |  
|------------------------------------------------------------------------------------------- |  | ---- | ---- | - | ---- |  | ---- | ---- |  |  | ----- | -
|                                                                                            |  | 2005 |      |   | 2004 |  |      | 2003 | 
|                                                                                            |  |      |      |   |      |  |      |      | 
|Commercial lines loss ratios before effects of hurricane losses
    and reserve development |  |      | 44.0 | % |      |  | 48.5 | %    |  |  | 51.8  | %
|Decrease in loss ratios attributable to reserve development                                 |  |      | (5.7 | ) |      |  | (9.8 | )    |  |  | (12.2 | )
|Increase in loss ratios attributable to hurricane losses                                    |  |      | 9.5  |   |      |  | 12.2 |      |  |  |      |  
|                                                                                            |  |      |      |   |      |  |      |      | 
|Total commercial lines loss ratios                                                          |  |      | 47.8 | % |      |  | 50.9 | %    |  |  | 39.6  | %
|                                                                                            |  |      |      |   |      |  |      |      | 







52



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|                                                                                          |  |      |      |   |      |  |      |      |  |  |      |  
|----------------------------------------------------------------------------------------- |  | ---- | ---- | - | ---- |  | ---- | ---- |  |  | ---- | -
|                                                                                          |  | 2005 |      |   | 2004 |  |      | 2003 | 
|                                                                                          |  |      |      |   |      |  |      |      | 
|Personal lines loss ratios before effects of hurricane losses
    and reserve development |  |      | 39.2 | % |      |  | 64.3 | %    |  |  | 64.6 | %
|(Decrease) increase in loss ratios attributable to reserve
    development                |  |      | (8.3 | ) |      |  | (2.6 | )    |  |  | 0.4  |  
|Increase in loss ratios attributable to hurricane losses                                  |  |      | 31.6 |   |      |  |     |      |  |  |     |  
|                                                                                          |  |      |      |   |      |  |      |      | 
|Total personal lines loss ratios                                                          |  |      | 62.5 | % |      |  | 61.7 | %    |  |  | 65.0 | %
|                                                                                          |  |      |      |   |      |  |      |      | 

Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.


10-K.












53



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| |                         
| | ------------------------
| | Policy Acquisition Costs



Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.


Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.




| |                                          
| | -----------------------------------------
| | Other Underwriting and Operating Expenses



Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.


Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.




| |                 
| | ----------------
| | Interest Expense

Year Ended December 31, 2005 as Compared to Year Ended
December 31, 2004.


Year Ended December 31, 2004 as Compared to Year Ended
December 31, 2003.


54



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| |                           
| | --------------------------
| | Federal Income Tax Expense

Year Ended December 31, 2005.


Year Ended December 31, 2004.


Year Ended December 31, 2003.




|                       |       |  |                 |  |         |            |  |  |      | 
|---------------------- | ----- |  | --------------- |  | ------- | ---------- |  |  | ---- | 
|Net Operating          |       |  |                 |  |        
|Losses                 |       |  |                 |  |        
|Carried                |       |  |                 |  | Year of |           
|Forward                |       |  | Year Originated |  |         | Expiration | 
|                       |       |  |                 |  |         |            | 
|(Dollars in thousands) |       |  |                 |  |        
|$                      | 94    |  |                 |  | 1996    |            |  |  | 2010 | 
|                       | 264   |  |                 |  | 1997    |            |  |  | 2011 | 
|                       | 2,291 |  |                 |  | 1999    |            |  |  | 2018 | 
|                       | 1,392 |  |                 |  | 2000    |            |  |  | 2019 | 
|                       | 3,693 |  |                 |  | 2001    |            |  |  | 2020 | 
|                       |       |  |                 |  |         |            | 
|$                      | 7,734 |  |                 |  |         |            |  |  |      | 
|                       |       |  |                 |  |         |            | 

Liquidity and Capital Resources




| |                          
| | -------------------------
| | Sources and Uses of Funds

Capital
Constraints,




55



---



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56



---



##### Table of Contents





| |           
| | ----------
| | Cash Flows



















57



---



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12-month 10-K.




| |                    
| | -------------------
| | Capital Constraints

Writings to Surplus Ratios: writings-to 3.0-to net gross premiums-to 4.0-to


1.40-to 2.74-to 2.76-to 0.4-to


Risk Based Capital:




Regulations on Dividends Paid by Insurance Companies: writings-to




58



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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The larger of (1) the lesser of 10% of the insurers
    surplus or net income (not including realized capital gains)
    plus a two-year carryforward; (2) 10% of surplus, with
    dividends payable constrained to unassigned funds minus 25% of
    unrealized capital gains; or (3) the lesser of 10% of
    surplus or net investment income plus a three-year carryforward
    with dividends payable constrained to unassigned funds minus 25%
    of unrealized capital gains. This threshold applies if the
    insurer does not provide prior notice of the dividend to the
    Florida insurance regulator and does not certify that, following
    payment of the dividend, the insurers surplus will equal
    or exceed 115% of the surplus required under applicable Florida
    statutes.
|
| |  | The larger of (1) 10% of the insurers surplus derived
    from realized net operating profits on its business and net
    realized capital gains; or (2) the insurers entire
    net operating profits and realized net capital gains derived
    during the immediately preceding calendar year. This threshold
    applies if the insurer provides prior notice of the dividend to
    the Florida insurance regulator, which notice certifies that,
    following payment of the dividend, the insurers surplus
    will equal or exceed 115% of the surplus required under the
    applicable Florida statutes.                                                                                                                                                                                     







| |                 
| | ----------------
| | Outstanding Debt

Senior Credit Facility.


59



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| |   |                                                                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | adjusted capital and surplus in excess of 215% of authorized
    control level risk-based capital as of each fiscal year
    end; and                                                        
|
| |  | a ratio of net premiums written to statutory capital and surplus
    of not more than 2.50 to 1.0 and a ratio of gross premiums
    written to statutory surplus of not more than 3.0 to 1.0.



Mortgage Obligation.




| |                                       
| | --------------------------------------
| | Issuance of Trust Preferred Securities

30-year,








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Contractual Obligations and Commitments




|                                            |       |                        |        |        |      |   |        |        |  |          |        |        |  |            |        |        |       |   |        |        |  |   |         |         | 
|------------------------------------------- | ----- | ---------------------- | ------ | ------ | ---- | - | ------ | ------ |  | -------- | ------ | ------ |  | ---------- | ------ | ------ | ----- | - | ------ | ------ |  | - | ------- | ------- | 
|                                            |       |                        |        |        |      |   |        |        |  | 2010 and |        |        | 
|                                            |       | 2006                   |        |        | 2007 |   |        | 2008   |  |          | 2009   |        |  | thereafter |        |        | Total |  
|                                            |       |                        |        |        |      |   |        |        |  |          |        |        |  |            |        |        |       |  
|                                            |       | (Dollars in thousands) |       
|Senior debt principal and interest payments |       | $                      | 2,484  |        |      | $ |       |        |  | $        |       |        |  | $          |       |        |       | $ |       |        |  | $ | 2,484   |        
|Mortgage obligation                         |       |                        | 267    |        |      |   | 267    |        |  |          | 267    |        |  |            | 267    |        |       |   | 2,299  |        |  |   | 3,367   |        
|Operating leases                            |       |                        | 714    |        |      |   | 730    |        |  |          | 682    |        |  |            | 413    |        |       |   |       |        |  |   | 2,539   |        
|Unpaid loss and losses adjustment expense   |       |                        | 46,842 |        |      |   | 31,665 |        |  |          | 16,180 |        |  |            | 10,957 |        |       |   | 12,134 |        |  |   | 117,778 |        
|Commitment to purchase other investments    |       |                        | 2,500  |        |      |   |       |        |  |          |       |        |  |            |       |        |       |   |       |        |  |   | 2,500   |        
|                                            |       |                        |        |        |      |   |        |        |  |          |        |        |  |            |        |        |       |  
|                                            | Total |                        | $      | 52,807 |      |   | $      | 32,662 |  |          | $      | 17,129 |  |            | $      | 11,637 |       |   | $      | 14,433 |  |   | $       | 128,668 | 
|                                            |       |                        |        |        |      |   |        |        |  |          |        |        |  |            |        |        |       |  



Effects of New Accounting Pronouncements


Accounting
Changes and Error Corrections, a replacement of Accounting
Principles Board (APB) No. 20, Accounting
Changes and FASB Statement No. 3.


61



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|         |                                                                
|-------- | ---------------------------------------------------------------
|Item 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
    RISK.



Interest Rate Risk






|                                      |  |                        |         |           |            |                         |        |            |  |               |        |    |  |  |      |   
|------------------------------------- |  | ---------------------- | ------- | --------- | ---------- | ----------------------- | ------ | ---------- |  | ------------- | ------ | -- |  |  | ---- | --
|                                      |  |                        |         |           |            | Hypothetical Percentage |       
|                                      |  |                        |         |           |            | Increase (Decrease) in  |       
|                                      |  |                        |         | Estimated |            |                         |        |           
|Hypothetical Change in Interest Rates |  | Estimated              |         |           | Change in  |                         |        |            |  | Shareholders |       
|As of December 31, 2005               |  | Fair Value             |         |           | Fair Value |                         |        | Fair Value |  |               | Equity |   
|                                      |  |                        |         |           |            |                         |        |            |  |               |        |   
|                                      |  | (Dollars in thousands) |        
|200 basis point increase              |  | $                      | 91,266  |           |            | $                       | (6,752 | )          |  |               | (6.9   | )% |  |  | (5.4 | )%
|100 basis point increase              |  |                        | 94,587  |           |            |                         | (3,431 | )          |  |               | (3.5   | )% |  |  | (2.8 | )%
|No change                             |  |                        | 98,018  |           |            |                         |       |            |  |               | 0.0    | %  |  |  | 0.0  | % 
|100 basis point decrease              |  |                        | 101,494 |           |            |                         | 3,476  |            |  |               | 3.5    | %  |  |  | 2.8  | % 
|200 basis point decrease              |  |                        | 104,331 |           |            |                         | 6,313  |            |  |               | 6.4    | %  |  |  | 5.1  | % 

Credit Risk








62



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Effects of Inflation




63



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|        |                                             
|------- | --------------------------------------------
|Item 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.



64



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North Pointe Holdings Corporation


Unaudited Consolidated Quarterly Results of Operations




period-to


|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |        |        | 
|------------------------------------------------------------------------------------ | ----------------------------------------- | ------------------------------------------------------- | ------ | ------ | ------------- | - | ----- | -------- | ------ | - | --------- | ------ | ------ | ------------ | ----- | ------ | ------------- | - | ----- | -------- | ------ | - | --------- | ------ | ------ | - | ----- | ------ | ------ | - | ----- | ------ | ------ | 
|                                                                                     |                                           | Quarters Ended                                          |       
|                                                                                     |                                           |                                                         |       
|                                                                                     |                                           | December 31,                                            |        |        | September 30, |   |       | June 30, |        |   | March 31, |        |        | December 31, |       |        | September 30, |   |       | June 30, |        |   | March 31, |       
|                                                                                     |                                           | 2005                                                    |        |        | 2005          |   |       | 2005     |        |   | 2005      |        |        | 2004         |       |        | 2004          |   |       | 2004     |        |   | 2004      |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|                                                                                     |                                           | (Dollars in thousands, except per share and ratio data) |       
|Statement of Operations Data:                                                        |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |       
|Revenues:                                                                            |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |       
|                                                                                     | Gross premiums written                    |                                                         | $      | 25,405 |               |   | $     | 18,433   |        |   | $         | 22,437 |        |              | $     | 45,821 |               |   | $     | 24,991   |        |   | $         | 22,342 |        |   | $     | 24,777 |        |   | $     | 24,351 |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|                                                                                     | Net premiums written                      |                                                         | $      | 14,990 |               |   | $     | 12,579   |        |   | $         | 17,898 |        |              | $     | 41,666 |               |   | $     | 21,386   |        |   | $         | 17,041 |        |   | $     | 21,071 |        |   | $     | 20,995 |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|                                                                                     | Net premiums earned                       |                                                         | $      | 17,892 |               |   | $     | 21,652   |        |   | $         | 23,057 |        |              | $     | 22,135 |               |   | $     | 19,918   |        |   | $         | 18,681 |        |   | $     | 19,564 |        |   | $     | 18,794 |       
|                                                                                     | Investment income, net                    |                                                         |        | 1,248  |               |   |       | 1,067    |        |   |           | 926    |        |              |       | 762    |               |   |       | 701      |        |   |           | 613    |        |   |       | 563    |        |   |       | 500    |       
|                                                                                     | Net realized capital gains (losses)       |                                                         |        | (14    | )             |   |       | 75       |        |   |           | (96    | )      |              |       | (133   | )             |   |       | 827      |        |   |           | (4     | )      |   |       | 23     |        |   |       | 40     |       
|                                                                                     | Fees and other income                     |                                                         |        | 429    |               |   |       | 695      |        |   |           | 436    |        |              |       | 343    |               |   |       | 443      |        |   |           | 568    |        |   |       | 569    |        |   |       | 642    |       
|                                                                                     | Gains on sales of businesses              |                                                         |        |       |               |   |       |         |        |   |           |       |        |              |       |       |               |   |       | 4,000    |        |   |           | 285    |        |   |       |       |        |   |       |       |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|                                                                                     |                                           | Total revenues                                          |        |        | 19,555        |   |       |          | 23,489 |   |           |        | 24,323 |              |       |        | 23,107        |   |       |          | 25,889 |   |           |        | 20,143 |   |       |        | 20,719 |   |       |        | 19,976 | 
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|Expenses:                                                                            |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |       
|                                                                                     | Losses and loss adjustment expenses, net  |                                                         |        | 13,647 |               |   |       | 11,991   |        |   |           | 9,274  |        |              |       | 9,091  |               |   |       | 9,586    |        |   |           | 13,116 |        |   |       | 8,562  |        |   |       | 10,239 |       
|                                                                                     | Policy acquisition costs                  |                                                         |        | 4,670  |               |   |       | 5,844    |        |   |           | 5,236  |        |              |       | 6,029  |               |   |       | 4,582    |        |   |           | 4,648  |        |   |       | 5,043  |        |   |       | 4,414  |       
|                                                                                     | Other underwriting and operating expenses |                                                         |        | 5,475  |               |   |       | 4,686    |        |   |           | 3,829  |        |              |       | 3,865  |               |   |       | 3,792    |        |   |           | 3,193  |        |   |       | 3,865  |        |   |       | 2,880  |       
|                                                                                     | Interest expense                          |                                                         |        | 75     |               |   |       | 390      |        |   |           | 264    |        |              |       | 230    |               |   |       | 245      |        |   |           | 232    |        |   |       | 145    |        |   |       | 141    |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|                                                                                     |                                           | Total expenses                                          |        |        | 23,867        |   |       |          | 22,911 |   |           |        | 18,603 |              |       |        | 19,215        |   |       |          | 18,205 |   |           |        | 21,189 |   |       |        | 17,615 |   |       |        | 17,674 | 
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|Income (loss) before federal income tax expense (benefit) and
    extraordinary item |                                           |                                                         | (4,312 | )      |               |   | 578   |          |        |   | 5,720     |        |        |              | 3,892 |        |               |   | 7,684 |          |        |   | (1,046    | )      |        |   | 3,104 |        |        |   | 2,302 |       
|Federal income tax expense (benefit)                                                 |                                           |                                                         | (1,516 | )      |               |   | 67    |          |        |   | 2,131     |        |        |              | 1,346 |        |               |   | 2,510 |          |        |   | (840      | )      |        |   | 1,026 |        |        |   | 820   |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|Income (loss) before extraordinary item                                              |                                           |                                                         | (2,796 | )      |               |   | 511   |          |        |   | 3,589     |        |        |              | 2,546 |        |               |   | 5,174 |          |        |   | (206      | )      |        |   | 2,078 |        |        |   | 1,482 |       
|Extraordinary item                                                                   |                                           |                                                         |       |        |               |   |      |          |        |   |          |        |        |              |      |        |               |   |      |          |        |   |          |        |        |   |      |        |        |   | 2,905 |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|Net income (loss)                                                                    |                                           | $                                                       | (2,796 | )      |               | $ | 511   |          |        | $ | 3,589     |        |        | $            | 2,546 |        |               | $ | 5,174 |          |        | $ | (206      | )      |        | $ | 2,078 |        |        | $ | 4,387 |       
|                                                                                     |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |       
|Earnings Per Share Data:                                                             |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |       
|Income (loss) before extraordinary item:                                             |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |       
|                                                                                     | Basic                                     |                                                         | $      | (0.31  | )             |   | $     | 0.10     |        |   | $         | 0.73   |        |              | $     | 0.52   |               |   | $     | 1.06     |        |   | $         | (0.04  | )      |   | $     | 0.22   |        |   | $     | 0.28   |       
|                                                                                     | Diluted                                   |                                                         |        | (0.31  | )             |   |       | 0.10     |        |   |           | 0.73   |        |              |       | 0.52   |               |   |       | 1.06     |        |   |           | (0.04  | )      |   |       | 0.22   |        |   |       | 0.22   |       
|Net income (loss):                                                                   |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |       
|                                                                                     | Basic                                     |                                                         |        | (0.31  | )             |   |       | 0.10     |        |   |           | 0.73   |        |              |       | 0.52   |               |   |       | 1.06     |        |   |           | (0.04  | )      |   |       | 0.22   |        |   |       | 0.83   |       
|                                                                                     | Diluted                                   |                                                         |        | (0.31  | )             |   |       | 0.10     |        |   |           | 0.73   |        |              |       | 0.52   |               |   |       | 1.06     |        |   |           | (0.04  | )      |   |       | 0.22   |        |   |       | 0.64   |       
|Key Financial Ratios:                                                                |                                           |                                                         |        |        |               |   |       |          |        |   |           |        |        |              |       |        |               |   |       |          |        |   |           |        |        |   |       |        |        |   |       |       
|Loss ratio                                                                           |                                           |                                                         | 74.5   | %      |               |   | 53.7  | %        |        |   | 39.5      | %      |        |              | 40.4  | %      |               |   | 47.1  | %        |        |   | 68.1      | %      |        |   | 42.5  | %      |        |   | 52.7  | %     
|Expense ratio                                                                        |                                           |                                                         | 55.4   |        |               |   | 47.1  |          |        |   | 38.6      |        |        |              | 44.0  |        |               |   | 41.1  |          |        |   | 40.7      |        |        |   | 44.2  |        |        |   | 37.5  |       
|Combined ratio                                                                       |                                           |                                                         | 129.9  |        |               |   | 100.8 |          |        |   | 78.1      |        |        |              | 84.4  |        |               |   | 88.2  |          |        |   | 108.8     |        |        |   | 86.7  |        |        |   | 90.2  |       

65



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|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|Item 9. | CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
    AND FINANCIAL DISCLOSURE.





|         |                         
|-------- | ------------------------
|Item 9A. | CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures




13a-15(b),


Changes in Internal Controls over Financial Reporting


13a-15(f) 15d-15(f)










66



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PART III*




|         |                                                        
|-------- | -------------------------------------------------------
|Item 10. | DIRECTORS AND EXECUTIVE OFFICERS OF THE
    REGISTRANT.





|         |                        
|-------- | -----------------------
|Item 11. | EXECUTIVE COMPENSATION.





|         |                                                                                                    
|-------- | ---------------------------------------------------------------------------------------------------
|Item 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
    MANAGEMENT AND RELATED STOCKHOLDER MATTERS.





|         |                                                    
|-------- | ---------------------------------------------------
|Item 13. | CERTAIN RELATIONSHIPS AND RELATED
    TRANSACTIONS.





|         |                                        
|-------- | ---------------------------------------
|Item 14. | PRINCIPAL ACCOUNTANT FEES AND SERVICES.



10-K


PART IV




|         |                                                                      
|-------- | ---------------------------------------------------------------------
|Item 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
    FORM 8-K.



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INDEX TO FINANCIAL STATEMENTS


|                                                                                                                                      |  |      |     | 
|------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                                                                                                                                      |  | Page |    
|                                                                                                                                      |  |      |    
|North Pointe Holdings Corporation and Subsidiaries
    Consolidated Financial Statements                                              |  |      |     | 
|Report of Independent Registered Public Accounting Firm                                                                               |  |      | 69  | 
|Consolidated Balance Sheets as of December 31, 2005 and 2004                                                                          |  |      | 70  | 
|Consolidated Statements of Income for the Years Ended
    December 31, 2005, 2004 and 2003                                            |  |      | 71  | 
|Consolidated Statements of Shareholders Equity and
    Comprehensive Income for the Years Ended December 31, 2005,
    2004 and 2003 |  |      | 72  | 
|Consolidated Statements of Cash Flows for the Years Ended
    December 31, 2005, 2004 and 2003                                        |  |      | 73  | 
|Notes to Consolidated Financial Statements                                                                                            |  |      | 74  | 
|Financial Statement Schedules                                                                                                         |  |      |     | 
|Schedule I  Summary of Investments 
    Other than Investments in Related Parties                                                   |  |      | 98  | 
|Schedule II  Condensed Financial Information of
    Registrant                                                                       |  |      | 99  | 
|Schedule III  Supplementary Insurance Information                                                                                    |  |      | 104 | 
|Schedule IV  Reinsurance                                                                                                             |  |      | 107 | 
|Schedule VI  Supplemental Information Concerning
    Property  Casualty Insurance Operations                                        |  |      | 108 | 

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Report of Independent Registered Public Accounting Firm














69



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##### Table of Contents



North Pointe Holdings Corporation and Subsidiaries


Consolidated Balance Sheets


As of December 31, 2005 and 2004


|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |         |        |        |   |         | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------- | ---- | ------- | ------ | ------ | - | ------- | 
|                                                                                                                                                                                |                                                                                                                                                  | 2005                                                                                                                                      |                                            |         | 2004 |        
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|                                                                                                                                                                                |                                                                                                                                                  | (Dollars in thousands,                                                                                                                    |                                           
|                                                                                                                                                                                |                                                                                                                                                  | except share data)                                                                                                                        |                                           
|ASSETS                                                                                                                                                                         
|Investments                                                                                                                                                                     |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |         |        |       
|                                                                                                                                                                                | Debt securities, available for sale, at fair value (amortized
    cost of $100,337 and $76,965 in 2005 and 2004, respectively)                   |                                                                                                                                           | $                                          | 98,018  |      |         | $      | 76,068 |  
|                                                                                                                                                                                | Common stocks, at fair value (cost of $8,681 and $8,371 in 2005
    and 2004, respectively)                                                      |                                                                                                                                           |                                            | 10,001  |      |         |        | 9,280  |  
|                                                                                                                                                                                | Other investments                                                                                                                                |                                                                                                                                           |                                            | 553     |      |         |        |       |  
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           | Total investments                          |         |      | 108,572 |        |        |   | 85,348  | 
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|Cash and cash equivalents                                                                                                                                                       |                                                                                                                                                  |                                                                                                                                           | 34,119                                     |         |      |         | 29,678 |       
|Restricted cash                                                                                                                                                                 |                                                                                                                                                  |                                                                                                                                           | 200                                        |         |      |         | 200    |       
|Accrued investment income                                                                                                                                                       |                                                                                                                                                  |                                                                                                                                           | 840                                        |         |      |         | 575    |       
|Premiums and agent balances receivable, net                                                                                                                                     |                                                                                                                                                  |                                                                                                                                           | 21,324                                     |         |      |         | 17,419 |       
|Reinsurance recoverables on                                                                                                                                                     |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |         |        |       
|                                                                                                                                                                                | Paid losses                                                                                                                                      |                                                                                                                                           |                                            | 11,470  |      |         |        | 8,214  |  
|                                                                                                                                                                                | Unpaid losses                                                                                                                                    |                                                                                                                                           |                                            | 65,989  |      |         |        | 36,544 |  
|Prepaid reinsurance premiums                                                                                                                                                    |                                                                                                                                                  |                                                                                                                                           | 7,424                                      |         |      |         | 5,551  |       
|Deferred policy acquisition costs                                                                                                                                               |                                                                                                                                                  |                                                                                                                                           | 9,578                                      |         |      |         | 9,793  |       
|Deferred federal income taxes, net                                                                                                                                              |                                                                                                                                                  |                                                                                                                                           | 5,843                                      |         |      |         | 5,865  |       
|Federal income tax recoverable                                                                                                                                                  |                                                                                                                                                  |                                                                                                                                           | 2,199                                      |         |      |         |       |       
|Fixed assets, net of accumulated depreciation                                                                                                                                   |                                                                                                                                                  |                                                                                                                                           | 4,990                                      |         |      |         | 630    |       
|Prepaid expenses and other assets                                                                                                                                               |                                                                                                                                                  |                                                                                                                                           | 2,488                                      |         |      |         | 3,863  |       
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           | Total assets                               |         | $    | 275,036 |        |        | $ | 203,680 | 
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|                                                                                                                                                                               
|LIABILITIES, REDEEMABLE PREFERRED STOCK AND
    SHAREHOLDERS EQUITY                                                                                                           
|                                                                                                                                                                               
|LIABILITIES                                                                                                                                                                     |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |         |        |       
|                                                                                                                                                                                | Unpaid losses and loss adjustment expenses                                                                                                       |                                                                                                                                           | $                                          | 117,778 |      |         | $      | 96,561 |  
|                                                                                                                                                                                | Unearned premiums                                                                                                                                |                                                                                                                                           |                                            | 44,701  |      |         |        | 42,251 |  
|                                                                                                                                                                                | Debt                                                                                                                                             |                                                                                                                                           |                                            | 5,026   |      |         |        | 20,062 |  
|                                                                                                                                                                                | Amounts due to reinsurers                                                                                                                        |                                                                                                                                           |                                            | 3,048   |      |         |        | 1,221  |  
|                                                                                                                                                                                | Accrued expenses and other liabilities                                                                                                           |                                                                                                                                           |                                            | 15,160  |      |         |        | 6,633  |  
|                                                                                                                                                                                | Premiums in advance                                                                                                                              |                                                                                                                                           |                                            | 7,096   |      |         |        | 928    |  
|                                                                                                                                                                                | Federal income tax payable                                                                                                                       |                                                                                                                                           |                                            |        |      |         |        | 1,332  |  
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           | Total liabilities                          |         |      | 192,809 |        |        |   | 168,988 | 
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|Commitments and Contingent Liabilities                                                                                                                                          |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |         |        |       
|Redeemable cumulative convertible preferred stock, no par value;
    0 and 60,000 shares authorized in 2005 and 2004,
    respectively; 0 shares issued and outstanding in 2004 |                                                                                                                                                  |                                                                                                                                           |                                           |         |      |         |       |       
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|Shareholders equity                                                                                                                                                            |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |         |        |       
|                                                                                                                                                                                | Common stock, no par value; 50,000,000 shares authorized;
    9,116,687 and 4,889,187 issued and outstanding in 2005 and 2004,
    respectively  |                                                                                                                                           |                                            | 50,233  |      |         |        | 5,880  |  
|                                                                                                                                                                                | Preferred stock, no par value; 5,000,000 and 0 shares
    authorized in 2005 and 2004, respectively; 0 shares issued
    and outstanding in 2005 |                                                                                                                                           |                                            |        |      |         |        |       |  
|                                                                                                                                                                                | Retained earnings                                                                                                                                |                                                                                                                                           |                                            | 32,653  |      |         |        | 28,803 |  
|                                                                                                                                                                                | Accumulated other comprehensive (loss) income                                                                                                    |                                                                                                                                           |                                            |         |      |         |        |        |  
|                                                                                                                                                                                |                                                                                                                                                  | Net unrealized (losses) gains on investments, net of deferred
    federal income tax benefit (expense) of $340 and ($3),
    respectively |                                            |         | (659 | )       |        |        | 9 |        
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           | Total shareholders equity                 |         |      | 82,227  |        |        |   | 34,692  | 
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           | Total liabilities and shareholders equity |         | $    | 275,036 |        |        | $ | 203,680 | 
|                                                                                                                                                                                |                                                                                                                                                  |                                                                                                                                           |                                            |         |      |        



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##### Table of Contents



North Pointe Holdings Corporation and Subsidiaries


Consolidated Statements of Income


For the Years Ended December 31, 2005, 2004 and 2003


|                                              |                                                                 |                                           |           |         |      |   |           |        |  |   |           |        | 
|--------------------------------------------- | --------------------------------------------------------------- | ----------------------------------------- | --------- | ------- | ---- | - | --------- | ------ |  | - | --------- | ------ | 
|                                              |                                                                 | 2005                                      |           |         | 2004 |   |           | 2003   | 
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              |                                                                 | (Dollars in thousands, except share data) |          
|Revenues                                      |                                                                 |                                           |           |         |      |   |           |        |  |   |           |       
|Direct premiums written                       |                                                                 | $                                         | 111,483   |         |      | $ | 94,548    |        |  | $ | 88,036    |       
|Assumed premiums written                      |                                                                 |                                           | 613       |         |      |   | 1,913     |        |  |   | 167       |       
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Gross premiums written                                          |                                           |           | 112,096 |      |   |           | 96,461 |  |   |           | 88,203 | 
|Premiums ceded                                |                                                                 |                                           | (24,963   | )       |      |   | (15,968   | )      |  |   | (11,979   | )     
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Net premiums written                                            |                                           |           | 87,133  |      |   |           | 80,493 |  |   |           | 76,224 | 
|Increase in unearned premiums                 |                                                                 |                                           | (2,397    | )       |      |   | (3,536    | )      |  |   | (7,484    | )     
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Net premiums earned                                             |                                           |           | 84,736  |      |   |           | 76,957 |  |   |           | 68,740 | 
|Investment income, net of investment expenses |                                                                 |                                           | 4,003     |         |      |   | 2,377     |        |  |   | 2,174     |       
|Net realized capital (losses) gains           |                                                                 |                                           | (168      | )       |      |   | 886       |        |  |   | 1,264     |       
|Fees and other income                         |                                                                 |                                           | 1,903     |         |      |   | 2,222     |        |  |   | 2,047     |       
|Gains on sales of businesses                  |                                                                 |                                           |          |         |      |   | 4,285     |        |  |   | 200       |       
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Total revenues                                                  |                                           |           | 90,474  |      |   |           | 86,727 |  |   |           | 74,425 | 
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|Expenses                                      |                                                                 |                                           |           |         |      |   |           |        |  |   |           |       
|Losses and loss adjustment expenses, net      |                                                                 |                                           | 44,003    |         |      |   | 41,503    |        |  |   | 33,141    |       
|Policy acquisition costs                      |                                                                 |                                           | 21,779    |         |      |   | 18,687    |        |  |   | 17,409    |       
|Other underwriting and operating expenses     |                                                                 |                                           | 17,855    |         |      |   | 13,730    |        |  |   | 13,159    |       
|Interest expense                              |                                                                 |                                           | 959       |         |      |   | 763       |        |  |   | 422       |       
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Total expenses                                                  |                                           |           | 84,596  |      |   |           | 74,683 |  |   |           | 64,131 | 
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Income before federal income tax expense and extraordinary item |                                           |           | 5,878   |      |   |           | 12,044 |  |   |           | 10,294 | 
|Federal income tax expense                    |                                                                 |                                           | 2,028     |         |      |   | 3,516     |        |  |   | 3,725     |       
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Income before extraordinary item                                |                                           |           | 3,850   |      |   |           | 8,528  |  |   |           | 6,569  | 
|Extraordinary item                            |                                                                 |                                           |          |         |      |   | 2,905     |        |  |   |          |       
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Net income                                                      |                                           | $         | 3,850   |      |   | $         | 11,433 |  |   | $         | 6,569  | 
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|Earnings Per Share                            |                                                                 |                                           |           |         |      |   |           |        |  |   |           |       
|Basic                                         |                                                                 |                                           |           |         |      |   |           |        |  |   |           |       
|Income before extraordinary item              |                                                                 | $                                         | 0.64      |         |      | $ | 1.50      |        |  | $ | 1.16      |       
|Extraordinary item                            |                                                                 |                                           |          |         |      |   | 0.57      |        |  |   |          |       
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Net income                                                      |                                           | $         | 0.64    |      |   | $         | 2.07   |  |   |           | 1.16   | 
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|Diluted                                       |                                                                 |                                           |           |         |      |   |           |        |  |   |           |       
|Income before extraordinary item              |                                                                 | $                                         | 0.64      |         |      | $ | 1.46      |        |  | $ | 0.90      |       
|Extraordinary item                            |                                                                 |                                           |          |         |      |   | 0.49      |        |  |   |          |       
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|                                              | Net income                                                      |                                           | $         | 0.64    |      |   | $         | 1.95   |  |   | $         | 0.90   | 
|                                              |                                                                 |                                           |           |         |      |   |           |        | 
|Weighted average number of shares             |                                                                 |                                           |           |         |      |   |           |        |  |   |           |       
|Basic                                         |                                                                 |                                           | 6,014,050 |         |      |   | 5,052,171 |        |  |   | 5,503,893 |       
|Diluted                                       |                                                                 |                                           | 6,014,218 |         |      |   | 5,860,580 |        |  |   | 7,273,387 |       



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##### Table of Contents



North Pointe Holdings Corporation and Subsidiaries


Consolidated Statements of Shareholders Equity and
Comprehensive Income


Years Ended December 31, 2005, 2004 and 2003


|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |      |   |   |        |        |  
|------------------------------------------ | ---------------------------------------------------------------------------------------- | ---------------------- | ------ | - | -------- | ----------- | ------ | ------------- |  | - | ----- | ---- | - | - | ------ | ------ | -
|                                           |                                                                                          |                        |        |   |          | Accumulated |        |               | 
|                                           |                                                                                          |                        |        |   |          | Other       |        |               | 
|                                           |                                                                                          | Common                 |        |   | Retained |             |        | Comprehensive |  |   |      
|                                           |                                                                                          | Stock                  |        |   | Earnings |             |        | Income (Loss) |  |   | Total |     
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     
|                                           |                                                                                          | (Dollars in thousands) |       
|Balances, December 31, 2002                |                                                                                          | $                      | 6,500  |   |          | $           | 13,594 |               |  | $ | 572   |      |   | $ | 20,666 |       
|Issuance of stock                          |                                                                                          |                        | 150    |   |          |             |       |               |  |   |      |      |   |   | 150    |       
|Purchase and retirement of common stock    |                                                                                          |                        | (465   | ) |          |             | (465   | )             |  |   |      |      |   |   | (930   | )     
|Preferred stock dividends                  |                                                                                          |                        |       |   |          |             | (160   | )             |  |   |      |      |   |   | (160   | )     
|Comprehensive income                       |                                                                                          |                        |        |   |          |             |        |               |  |   |       |      |   |   |        |       
|                                           | Net income                                                                               |                        |        |  |          |             |        | 6,569         |  |   |       |     |   |   |        | 6,569  |  
|                                           | Unrealized losses on investments, net of deferred federal income
    tax benefit of $105 |                        |        |  |          |             |        |              |  |   |       | (202 | ) |   |        | (202   | )
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     
|Total comprehensive income                 |                                                                                          |                        |       |   |          |             |       |               |  |   |      |      |   |   | 6,367  |       
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     
|Balances, December 31, 2003                |                                                                                          | $                      | 6,185  |   |          | $           | 19,538 |               |  | $ | 370   |      |   | $ | 26,093 |       
|Issuance of stock                          |                                                                                          |                        | 95     |   |          |             |       |               |  |   |      |      |   |   | 95     |       
|Purchase and retirement of common stock    |                                                                                          |                        | (400   | ) |          |             | (1,200 | )             |  |   |      |      |   |   | (1,600 | )     
|Purchase and retirement of preferred stock |                                                                                          |                        |       |   |          |             | (888   | )             |  |   |      |      |   |   | (888   | )     
|Preferred stock dividends                  |                                                                                          |                        |       |   |          |             | (80    | )             |  |   |      |      |   |   | (80    | )     
|Comprehensive income                       |                                                                                          |                        |        |   |          |             |        |               |  |   |       |      |   |   |        |       
|                                           | Net income                                                                               |                        |        |  |          |             |        | 11,433        |  |   |       |     |   |   |        | 11,433 |  
|                                           | Unrealized losses on investments, net of deferred federal income
    tax benefit of $187 |                        |        |  |          |             |        |              |  |   |       | (361 | ) |   |        | (361   | )
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     
|Total comprehensive income                 |                                                                                          |                        |       |   |          |             |       |               |  |   |      |      |   |   | 11,072 |       
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     
|Balances, December 31, 2004                |                                                                                          | $                      | 5,880  |   |          | $           | 28,803 |               |  | $ | 9     |      |   | $ | 34,692 |       
|Issuance of stock                          |                                                                                          |                        | 44,270 |   |          |             |       |               |  |   |      |      |   |   | 44,270 |       
|Stock-based employee compensation          |                                                                                          |                        | 83     |   |          |             |        |               |  |   |       |      |   |   | 83     |       
|Comprehensive income                       |                                                                                          |                        |        |   |          |             |        |               |  |   |       |      |   |   |        |       
|                                           | Net income                                                                               |                        |        |  |          |             |        | 3,850         |  |   |       |     |   |   |        | 3,850  |  
|                                           | Unrealized losses on investments, net of deferred federal income
    tax benefit of $343 |                        |        |  |          |             |        |              |  |   |       | (668 | ) |   |        | (668   | )
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     
|Total comprehensive income                 |                                                                                          |                        |       |   |          |             |       |               |  |   |      |      |   |   | 3,182  |       
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     
|Balances, December 31, 2005                |                                                                                          | $                      | 50,233 |   |          | $           | 32,653 |               |  | $ | (659  | )    |   | $ | 82,227 |       
|                                           |                                                                                          |                        |        |   |          |             |        |               |  |   |       |     



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##### Table of Contents



North Pointe Holdings Corporation and Subsidiaries


Consolidated Statements of Cash Flows


Years Ended December 31, 2005, 2004 and 2003


|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |        |        |        |  
|----------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------ | -------------------------------------------- | --------------------------------------------------- | ----- | ------- | ------- | ------- | ------ | ------- | ----- | ------- | ------ | ------ | ------ | -
|                                                                                                      |                                                                    | 2005                                         |                                                     |       | 2004    |         |         | 2003   |        
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|                                                                                                      |                                                                    | (Dollars in thousands)                       |                                                    
|Cash flows from operating activities                                                                  |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |       
|Net income                                                                                            |                                                                    | $                                            | 3,850                                               |       |         | $       | 11,433  |        |         | $     | 6,569   |       
|Adjustments to reconcile net income to cash provided by
    operating activities                      |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |       
|                                                                                                      | Extraordinary item                                                 |                                              |                                                     |      |         |         |         | (2,905 | )       |       |         |       |       
|                                                                                                      | Depreciation and amortization                                      |                                              |                                                     | 642   |         |         |         | 510    |         |       |         | 251    |       
|                                                                                                      | Bad debt expense                                                   |                                              |                                                     | (71   | )       |         |         |       |         |       |         | (627   | )     
|                                                                                                      | Net loss (gain) on sales and other dispositions of
    investments |                                              |                                                     | 168   |         |         |         | (886   | )       |       |         | (1,264 | )     
|                                                                                                      | Net gains on sales of businesses                                   |                                              |                                                     |      |         |         |         | (4,285 | )       |       |         | (200   | )     
|                                                                                                      | Stock compensation expense                                         |                                              |                                                     | 82    |         |         |         |       |         |       |         |       |       
|                                                                                                      | Deferred federal income tax expense                                |                                              |                                                     | 365   |         |         |         | 976    |         |       |         | 1,371  |       
|                                                                                                      | Change in assets and liabilities                                   |                                              |                                                     |       |         |         |         |        |         |       |         |        |       
|                                                                                                      |                                                                    | Restricted cash                              |                                                     |       |        |         |         |        | 1,116   |       |         |        | 302    |       
|                                                                                                      |                                                                    | Premiums and agents balances receivable, net |                                                     |       | (3,834  | )       |         |        | 1,224   |       |         |        | (384   | )     
|                                                                                                      |                                                                    | Accrued investment income                    |                                                     |       | (265    | )       |         |        | (96     | )     |         |        | 153    |       
|                                                                                                      |                                                                    | Reinsurance recoverable, net                 |                                                     |       | (30,874 | )       |         |        | (19,076 | )     |         |        | 3,187  |       
|                                                                                                      |                                                                    | Prepaid reinsurance premiums                 |                                                     |       | (1,873  | )       |         |        | (183    | )     |         |        | 1,230  |       
|                                                                                                      |                                                                    | Deferred policy acquisition costs            |                                                     |       | 215     |         |         |        | (2,620  | )     |         |        | (847   | )     
|                                                                                                      |                                                                    | Prepaid expenses and other assets            |                                                     |       | 1,451   |         |         |        | (1,179  | )     |         |        | (318   | )     
|                                                                                                      |                                                                    | Losses and loss adjustment expenses          |                                                     |       | 21,217  |         |         |        | 12,360  |       |         |        | (6,629 | )     
|                                                                                                      |                                                                    | Unearned premiums                            |                                                     |       | 2,450   |         |         |        | 3,719   |       |         |        | 6,254  |       
|                                                                                                      |                                                                    | Accrued expenses and other liabilities       |                                                     |       | 8,664   |         |         |        | (251    | )     |         |        | (489   | )     
|                                                                                                      |                                                                    | Premiums in advance                          |                                                     |       | 6,168   |         |         |        | 282     |       |         |        | (1,186 | )     
|                                                                                                      |                                                                    | Federal income tax (recoverable) payable     |                                                     |       | (3,531  | )       |         |        | 46      |       |         |        | 854    |       
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|                                                                                                      |                                                                    |                                              | Net cash provided by operating activities           |       |         | 4,824   |         |        |         | 185   |         |        |        | 8,227  |  
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|Cash flows from investing activities                                                                  |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |       
|Proceeds from maturities of debt securities                                                           |                                                                    |                                              | 6,723                                               |       |         |         | 28,168  |        |         |       | 44,650  |       
|Proceeds from sales of debt securities                                                                |                                                                    |                                              | 35,334                                              |       |         |         | 13,213  |        |         |       | 40,194  |       
|Proceeds from sales of equity securities                                                              |                                                                    |                                              | 4,203                                               |       |         |         | 9,175   |        |         |       | 1,189   |       
|Proceeds from sale of subsidiary, net of $4,500 of cash and cash
    equivalents                      |                                                                    |                                              |                                                    |       |         |         |        |        |         |       | 700     |       
|Proceeds from sale of business                                                                        |                                                                    |                                              |                                                    |       |         |         | 4,285   |        |         |       |        |       
|Purchase of debt securities                                                                           |                                                                    |                                              | (66,368                                             | )     |         |         | (42,621 | )      |         |       | (85,361 | )     
|Purchase of equity securities                                                                         |                                                                    |                                              | (4,164                                              | )     |         |         | (10,765 | )      |         |       | (27     | )     
|Purchase of other investments                                                                         |                                                                    |                                              | (553                                                | )     |         |         |        |        |         |       |        |       
|Purchase of subsidiaries, net of cash acquired of $168 and
    $14,376 in 2005 and 2004, respectively |                                                                    |                                              | (1,386                                              | )     |         |         | 3,255   |        |         |       |        |       
|Purchase of fixed assets                                                                              |                                                                    |                                              | (742                                                | )     |         |         | (579    | )      |         |       | (318    | )     
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|                                                                                                      |                                                                    |                                              | Net cash (used in) provided by investing activities |       |         | (26,953 | )       |        |         | 4,131 |         |        |        | 1,027  |  
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|Cash flows from financing activities                                                                  |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |       
|Proceeds from issuance of common stock, net                                                           |                                                                    |                                              | 44,270                                              |       |         |         | 95      |        |         |       | 150     |       
|Purchase and retirement of common stock                                                               |                                                                    |                                              |                                                    |       |         |         | (1,600  | )      |         |       | (930    | )     
|Purchase and retirement of preferred stock                                                            |                                                                    |                                              |                                                    |       |         |         | (2,888  | )      |         |       |        |       
|Proceeds from issuance of bank debt                                                                   |                                                                    |                                              | 38,014                                              |       |         |         | 22,059  |        |         |       | 11,570  |       
|Repayments of bank debt                                                                               |                                                                    |                                              | (55,714                                             | )     |         |         | (12,845 | )      |         |       | (13,035 | )     
|Preferred dividends paid                                                                              |                                                                    |                                              |                                                    |       |         |         | (80     | )      |         |       | (160    | )     
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|                                                                                                      |                                                                    |                                              | Net cash provided by (used in) financing activities |       |         | 26,570  |         |        |         | 4,741 |         |        |        | (2,405 | )
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|                                                                                                      |                                                                    |                                              | Increase in cash and cash equivalents               |       |         | 4,441   |         |        |         | 9,057 |         |        |        | 6,849  |  
|Cash and cash equivalents                                                                             |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |       
|Beginning of year                                                                                     |                                                                    |                                              | 29,678                                              |       |         |         | 20,621  |        |         |       | 13,772  |       
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|End of year                                                                                           |                                                                    | $                                            | 34,119                                              |       |         | $       | 29,678  |        |         | $     | 20,621  |       
|                                                                                                      |                                                                    |                                              |                                                     |       |         |         |         |        |        
|Supplemental cash flow information  cash paid
    during the year for                                |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |       
|                                                                                                      | Interest                                                           |                                              | $                                                   | 1,074 |         |         | $       | 630    |         |       | $       | 445    |       
|Federal income taxes                                                                                  |                                                                    |                                              | 5,194                                               |       |         |         | 2,493   |        |         |       | 1,500   |       
|Supplemental disclosure of noncash investing activities                                               |                                                                    |                                              |                                                     |       |         |         |         |        |         |       |         |       
|Liabilities assumed in purchase of subsidiaries                                                       |                                                                    |                                              | 2,663                                               |       |         |         | 8,135   |        |         |       |        |       



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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated Financial Statements




|   |                        
|-- | -----------------------
|1. | Description of Business























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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)






Acquisition Activities




| |                      
| | ---------------------
| | North Pointe Casualty









|                                        |                                                                |             |        |        | 
|--------------------------------------- | -------------------------------------------------------------- | ----------- | ------ | ------ | 
|                                        |                                                                | (Dollars in |       
|                                        |                                                                | thousands)  |       
|                                        |                                                                |             |       
|Cash and investments                    |                                                                | $           | 19,436 |       
|Reinsurance recoverables                |                                                                |             | 1,939  |       
|Other assets                            |                                                                |             | 786    |       
|                                        |                                                                |             |       
|                                        | Total assets                                                   |             |        | 22,161 | 
|                                        |                                                                |             |       
|Losses and loss adjustment expenses     |                                                                |             | 7,882  |       
|Other liabilities                       |                                                                |             | 253    |       
|                                        |                                                                |             |       
|                                        | Total liabilities                                              |             |        | 8,135  | 
|                                        |                                                                |             |       
|                                        | Net assets acquired                                            |             |        | 14,026 | 
|Purchase price and acquisition expenses |                                                                |             | 11,121 |       
|                                        |                                                                |             |       
|                                        | Net assets in excess of purchase price  negative
    goodwill |             | $      | 2,905  | 
|                                        |                                                                |             |       



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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)




|                                                          |  |                   |        | 
|--------------------------------------------------------- |  | ----------------- | ------ | 
|                                                          |  | (Dollars in       |       
|                                                          |  | thousands, except |       
|                                                          |  | per share data)   |       
|                                                          |  |                   |       
|Total revenues                                            |  | $                 | 86,761 | 
|                                                          |  |                   |       
|Income before extraordinary item                          |  | $                 | 8,028  | 
|                                                          |  |                   |       
|Net income                                                |  | $                 | 10,933 | 
|                                                          |  |                   |       
|Diluted income per common share before extraordinary item |  | $                 | 1.37   | 
|                                                          |  |                   |       
|Diluted net income per common share                       |  | $                 | 1.87   | 
|                                                          |  |                   |       



| |                                      
| | -------------------------------------
| | Florida Homeowners Insurance Business





| |                    
| | -------------------
| | Northwestern Zodiac







|                                     |                                                              |             |       |       | 
|------------------------------------ | ------------------------------------------------------------ | ----------- | ----- | ----- | 
|                                     |                                                              | (Dollars in |      
|                                     |                                                              | thousands)  |      
|                                     |                                                              |             |      
|Cash                                 |                                                              | $           | 168   |      
|Prepaid expenses                     |                                                              |             | 76    |      
|Building and land                    |                                                              |             | 3,972 |      
|                                     |                                                              |             |      
|                                     | Total assets                                                 |             |       | 4,216 | 
|Mortgage loan                        |                                                              |             | 2,663 |      
|                                     |                                                              |             |      
|                                     | Net assets acquired                                          |             |       | 1,553 | 
|Purchase price and acquisition costs |                                                              |             | 1,553 |      
|                                     |                                                              |             |      
|                                     | Net assets in excess of purchase price and acquisition costs |             | $     |      | 
|                                     |                                                              |             |      



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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)




| |                    
| | -------------------
| | Sales of Businesses









|   |                                    
|-- | -----------------------------------
|2. | Public Offering and Use of Proceeds







|   |                                           
|-- | ------------------------------------------
|3. | Summary of Significant Accounting Policies



| |                                                                    
| | -------------------------------------------------------------------
| | Basis of Financial Presentation and Principles of
    Consolidation





| |            
| | -----------
| | Investments







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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)






| |                          
| | -------------------------
| | Cash and Cash Equivalents





| |                
| | ---------------
| | Restricted Cash





| |                                        
| | ---------------------------------------
| | Premiums and Agents Balances Receivable





| |                                  
| | ---------------------------------
| | Deferred Policy Acquisition Costs





| |                       
| | ----------------------
| | Property and Equipment





| |                                                                            
| | ---------------------------------------------------------------------------
| | Unpaid Losses and Loss Adjustment Expenses and Reinsurance
    Recoverables





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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)






| |            
| | -----------
| | Reinsurance





| |                         
| | ------------------------
| | Stock-Based Compensation





| |                    
| | -------------------
| | Revenue Recognition











| |                  
| | -----------------
| | Segment Reporting





| |                     
| | --------------------
| | Federal Income Taxes







| |                   
| | ------------------
| | Earnings Per Share



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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)




| |                 
| | ----------------
| | Use of Estimates







|   |            
|-- | -----------
|4. | Investments



|                                      |                       |                        |        |         |            |   |       |            |  |   |            |       |  |   |        |         | 
|------------------------------------- | --------------------- | ---------------------- | ------ | ------- | ---------- | - | ----- | ---------- |  | - | ---------- | ----- |  | - | ------ | ------- | 
|                                      |                       | Cost or                |        |         | Gross      |   |       | Gross      |  |   |           
|                                      |                       | Amortized              |        |         | Unrealized |   |       | Unrealized |  |   |           
|                                      |                       | Cost                   |        |         | Gains      |   |       | Losses     |  |   | Fair Value |      
|                                      |                       |                        |        |         |            |   |       |            |  |   |            |      
|                                      |                       | (Dollars in thousands) |       
|December 31, 2005                     |                       |                        |        |         |            |   |       |            |  |   |            |       |  |   |        |        
|U.S. government and agency securities |                       | $                      | 21,113 |         |            | $ | 7     |            |  | $ | 448        |       |  | $ | 20,672 |        
|Foreign government securities         |                       |                        | 575    |         |            |   |      |            |  |   | 14         |       |  |   | 561    |        
|Corporate bonds                       |                       |                        | 32,366 |         |            |   | 3     |            |  |   | 860        |       |  |   | 31,509 |        
|Mortgage-backed securities            |                       |                        | 33,735 |         |            |   | 10    |            |  |   | 898        |       |  |   | 32,847 |        
|Asset-backed securities               |                       |                        | 12,548 |         |            |   | 18    |            |  |   | 137        |       |  |   | 12,429 |        
|                                      |                       |                        |        |         |            |   |       |            |  |   |            |      
|                                      | Total debt securities |                        |        | 100,337 |            |   |       | 38         |  |   |            | 2,357 |  |   |        | 98,018  | 
|Common stocks                         |                       |                        | 8,681  |         |            |   | 1,464 |            |  |   | 144        |       |  |   | 10,001 |        
|                                      |                       |                        |        |         |            |   |       |            |  |   |            |      
|                                      | Total                 |                        | $      | 109,018 |            |   | $     | 1,502      |  |   | $          | 2,501 |  |   | $      | 108,019 | 
|                                      |                       |                        |        |         |            |   |       |            |  |   |            |      
|December 31, 2004                     |                       |                        |        |         |            |   |       |            |  |   |            |       |  |   |        |        
|U.S. government and agency securities |                       | $                      | 33,479 |         |            | $ | 7     |            |  | $ | 340        |       |  | $ | 33,146 |        
|Corporate bonds                       |                       |                        | 20,043 |         |            |   | 13    |            |  |   | 261        |       |  |   | 19,795 |        
|Mortgage-backed securities            |                       |                        | 23,443 |         |            |   | 38    |            |  |   | 354        |       |  |   | 23,127 |        
|                                      |                       |                        |        |         |            |   |       |            |  |   |            |      
|                                      | Total debt securities |                        |        | 76,965  |            |   |       | 58         |  |   |            | 955   |  |   |        | 76,068  | 
|Common stocks                         |                       |                        | 8,371  |         |            |   | 970   |            |  |   | 61         |       |  |   | 9,280  |        
|                                      |                       |                        |        |         |            |   |       |            |  |   |            |      
|                                      | Total                 |                        | $      | 85,336  |            |   | $     | 1,028      |  |   | $          | 1,016 |  |   | $      | 85,348  | 
|                                      |                       |                        |        |         |            |   |       |            |  |   |            |      



|                                                        |                 |                        |      |        |      |   |      |      |   |   |      |        |  
|------------------------------------------------------- | --------------- | ---------------------- | ---- | ------ | ---- | - | ---- | ---- | - | - | ---- | ------ | -
|                                                        |                 | 2005                   |      |        | 2004 |   |      | 2003 |  
|                                                        |                 |                        |      |        |      |   |      |      |  
|                                                        |                 | (Dollars in thousands) |     
|Net unrealized gains at beginning of year               |                 | $                      | 9    |        |      | $ | 370  |      |   | $ | 572  |       
|Increase in net unrealized gains (losses):              |                 |                        |      |        |      |   |      |      |   |   |      |       
|                                                        | Debt securities |                        |      | (1,422 | )    |   |      | (593 | ) |   |      | (1,313 | )
|                                                        | Preferred stock |                        |      |       |      |   |      | 9    |   |   |      | (24    | )
|                                                        | Common stock    |                        |      | 411    |      |   |      | 36   |   |   |      | 1,030  |  
|Net decrease in deferred federal income tax expense     |                 |                        | 343  |        |      |   | 187  |      |   |   | 105  |       
|                                                        |                 |                        |      |        |      |   |      |      |  
|Decrease in net unrealized gains, net of deferred taxes |                 |                        | (668 | )      |      |   | (361 | )    |   |   | (202 | )     
|                                                        |                 |                        |      |        |      |   |      |      |  
|Net unrealized (losses) gains at end of year            |                 | $                      | (659 | )      |      | $ | 9    |      |   | $ | 370  |       
|                                                        |                 |                        |      |        |      |   |      |      |  

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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)




|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |   |        |        |  |   |     |       | 
|------------------------------------- | --------------------- | ---------------------- | ------ | ------ | ----------------- | - | --- | ----- | ----- | - | ---------- | ------ |  | ----- | --- | ----- | ---------- | - | ------ | ------ |  | - | --- | ----- | 
|                                      |                       | Less than 12 Months    |        |        | 12 Months or More |   |     | Total |      
|                                      |                       |                        |        |        |                   |   |     |       |      
|                                      |                       |                        |        | Gross  |                   |   |     |       | Gross |   |            |        |  | Gross |    
|                                      |                       | Fair                   |        |        | Unrealized        |   |     | Fair  |       |   | Unrealized |        |  | Fair  |     |       | Unrealized |  
|                                      |                       | Value                  |        |        | Loss              |   |     | Value |       |   | Loss       |        |  | Value |     |       | Loss       |  
|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |  
|                                      |                       | (Dollars in thousands) |       
|December 31, 2005                     |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |   |        |        |  |   |     |      
|U.S. government and agency securities |                       | $                      | 11,858 |        |                   | $ | 198 |       |       | $ | 7,221      |        |  | $     | 250 |       |            | $ | 19,079 |        |  | $ | 448 |      
|Foreign government securities         |                       |                        | 306    |        |                   |   | 5   |       |       |   | 255        |        |  |       | 9   |       |            |   | 561    |        |  |   | 14  |      
|Corporate bonds                       |                       |                        | 18,543 |        |                   |   | 413 |       |       |   | 11,816     |        |  |       | 447 |       |            |   | 30,359 |        |  |   | 860 |      
|Mortgage-backed securities            |                       |                        | 19,911 |        |                   |   | 381 |       |       |   | 12,384     |        |  |       | 517 |       |            |   | 32,295 |        |  |   | 898 |      
|Asset-backed securities               |                       |                        | 11,306 |        |                   |   | 137 |       |       |   |           |        |  |       |    |       |            |   | 11,306 |        |  |   | 137 |      
|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |  
|                                      | Total debt securities |                        | $      | 61,924 |                   |   | $   | 1,134 |       |   | $          | 31,676 |  |       | $   | 1,223 |            |   | $      | 93,600 |  |   | $   | 2,357 | 
|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |  
|Equity securities                     |                       | $                      | 1,583  |        |                   | $ | 94  |       |       | $ | 225        |        |  | $     | 50  |       |            | $ | 1,808  |        |  | $ | 144 |      
|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |  
|December 31, 2004                     |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |   |        |        |  |   |     |      
|U.S. government and agency securities |                       | $                      | 22,970 |        |                   | $ | 274 |       |       | $ | 2,935      |        |  | $     | 66  |       |            | $ | 25,905 |        |  | $ | 340 |      
|Corporate bonds                       |                       |                        | 31,694 |        |                   |   | 184 |       |       |   | 1,920      |        |  |       | 77  |       |            |   | 33,614 |        |  |   | 261 |      
|Mortgage-backed securities            |                       |                        | 14,141 |        |                   |   | 253 |       |       |   | 5,086      |        |  |       | 101 |       |            |   | 19,227 |        |  |   | 354 |      
|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |  
|                                      | Total debt securities |                        | $      | 68,805 |                   |   | $   | 711   |       |   | $          | 9,941  |  |       | $   | 244   |            |   | $      | 78,746 |  |   | $   | 955   | 
|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |  
|Equity securities                     |                       | $                      | 940    |        |                   | $ | 51  |       |       | $ | 118        |        |  | $     | 10  |       |            | $ | 1,058  |        |  | $ | 61  |      
|                                      |                       |                        |        |        |                   |   |     |       |       |   |            |        |  |       |     |       |            |  







81



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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)




|                                       |  |                        |         |  |       |   |        | 
|-------------------------------------- |  | ---------------------- | ------- |  | ----- | - | ------ | 
|                                       |  | Amortized              |         |  | Fair  |  
|                                       |  | Cost                   |         |  | Value |  
|                                       |  |                        |         |  |       |  
|                                       |  | (Dollars in thousands) |        
|Due within one year                    |  | $                      | 1,299   |  |       | $ | 1,239  | 
|Due after one year through five years  |  |                        | 33,903  |  |       |   | 33,056 | 
|Due after five years through ten years |  |                        | 17,919  |  |       |   | 17,534 | 
|Due after ten years                    |  |                        | 933     |  |       |   | 913    | 
|Mortgage-backed securities             |  |                        | 33,735  |  |       |   | 32,847 | 
|Asset-backed securities                |  |                        | 12,548  |  |       |   | 12,429 | 
|                                       |  |                        |         |  |       |  
|                                       |  | $                      | 100,337 |  |       | $ | 98,018 | 
|                                       |  |                        |         |  |       |  



|                          |                       |                        |       |       |      |   |       |       |  |   |       |       | 
|------------------------- | --------------------- | ---------------------- | ----- | ----- | ---- | - | ----- | ----- |  | - | ----- | ----- | 
|                          |                       | 2005                   |       |       | 2004 |   |       | 2003  | 
|                          |                       |                        |       |       |      |   |       |       | 
|                          |                       | (Dollars in thousands) |      
|Interest income from      |                       |                        |       |       |      |   |       |       |  |   |       |      
|Debt securities           |                       | $                      | 3,808 |       |      | $ | 2,159 |       |  | $ | 2,212 |      
|Cash and cash equivalents |                       |                        | 605   |       |      |   | 353   |       |  |   | 195   |      
|Dividends from            |                       |                        |       |       |      |   |       |       |  |   |       |      
|Preferred stocks          |                       |                        |      |       |      |   | 88    |       |  |   | 104   |      
|Common stocks             |                       |                        | 152   |       |      |   | 207   |       |  |   | 92    |      
|                          |                       |                        |       |       |      |   |       |       | 
|                          |                       |                        | 4,565 |       |      |   | 2,807 |       |  |   | 2,603 |      
|Less: Investment expenses |                       |                        | 562   |       |      |   | 430   |       |  |   | 429   |      
|                          |                       |                        |       |       |      |   |       |       | 
|                          | Net investment income |                        | $     | 4,003 |      |   | $     | 2,377 |  |   | $     | 2,174 | 
|                          |                       |                        |       |       |      |   |       |       | 



|                                                       |  |                        |        |  |      |   |        |      |  |   |        | 
|------------------------------------------------------ |  | ---------------------- | ------ |  | ---- | - | ------ | ---- |  | - | ------ | 
|                                                       |  | 2005                   |        |  | 2004 |   |        | 2003 | 
|                                                       |  |                        |        |  |      |   |        |      | 
|                                                       |  | (Dollars in thousands) |       
|Proceeds from discretionary sales of debt securities   |  | $                      | 35,334 |  |      | $ | 13,213 |      |  | $ | 40,194 | 
|Related realized gains                                 |  |                        | 115    |  |      |   | 50     |      |  |   | 1,127  | 
|Related realized losses                                |  |                        | 619    |  |      |   | 84     |      |  |   |       | 
|Proceeds from discretionary sales of equity securities |  |                        | 4,203  |  |      |   | 9,175  |      |  |   | 1,189  | 
|Related realized gains                                 |  |                        | 571    |  |      |   | 1,142  |      |  |   | 104    | 
|Related realized losses                                |  |                        | 223    |  |      |   | 287    |      |  |   | 15     | 





|   |                                    
|-- | -----------------------------------
|5. | Fair Value of Financial Instruments

Disclosures about Fair Value of Financial
Instruments,


Accounting
for Certain Investments in Debt and Equity Securities,


82



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North Pointe Holdings Corporation and Subsidiaries


Notes to Consolidated
Financial Statements  (Continued)






|   |                                  
|-- | ---------------------------------
|6. | Deferred Policy Acquisition Costs



|                             |                        |                        |         |       |      |   |         |       |  |   |         |       | 
|---------------------------- | ---------------------- | ---------------------- | ------- | ----- | ---- | - | ------- | ----- |  | - | ------- | ----- | 
|                             |                        | 2005                   |         |       | 2004 |   |         | 2003  | 
|                             |                        |                        |         |       |      |   |         |       | 
|                             |                        | (Dollars in thousands) |        
|Balance, beginning of period |                        | $                      | 9,793   |       |      | $ | 7,173   |       |  | $ | 6,326   |      
|Additions                    |                        |                        | 21,282  |       |      |   | 21,307  |       |  |   | 18,256  |      
|Amortizations                |                        |                        | (21,497 | )     |      |   | (18,687 | )     |  |   | (17,409 | )    
|                             |                        |                        |         |       |      |   |         |       | 
|                             | Balance, end of period |                        | $       | 9,578 |      |   | $       | 9,793 |  |   | $       | 7,173 | 
|                             |                        |                        |         |       |      |   |         |       | 



|   |                                    
|-- | -----------------------------------
|7. | Liability for Unpaid Losses and LAE



|                                                                 |                |                                   |         |        |      |   |        |        |       |   |        |        |   | 
|---------------------------------------------------------------- | -------------- | --------------------------------- | ------- | ------ | ---- | - | ------ | ------ | ----- | - | ------ | ------ | - | 
|                                                                 |                | 2005                              |         |        | 2004 |   |        | 2003   |      
|                                                                 |                |                                   |         |        |      |   |        |        |      
|                                                                 |                | (Dollars in thousands)            |        
|Balance, beginning of period                                     |                | $                                 | 96,561  |        |      | $ | 76,319 |        |       | $ | 82,949 |       
|                                                                 |                |                                   |         |        |      |   |        |        |      
|Liability for losses and LAE acquired                            |                |                                   |        |        |      |   | 9,080  |        |       |   |       |       
|Less: Reinsurance recoverables                                   |                |                                   | 36,544  |        |      |   | 22,681 |        |       |   | 28,446 |       
|                                                                 |                | Reinsurance recoverables acquired |         |        |     |   |        |        | 3,008 |   |        |        |  | 
|                                                                 |                |                                   |         |        |      |   |        |        |      
|Net balance                                                      |                |                                   | 60,017  |        |      |   | 59,710 |        |       |   | 54,503 |       
|Incurred related to                                              |                |                                   |         |        |      |   |        |        |       |   |        |       
|Current year                                                     |                |                                   | 49,438  |        |      |   | 47,495 |        |       |   | 38,569 |       
|Prior years                                                      |                |                                   | (5,435  | )      |      |   | (5,992 | )      |       |   | (5,428 | )     
|                                                                 |                |                                   |         |        |      |   |        |        |      
|                                                                 | Total incurred |                                   |         | 44,003 |      |   |        | 41,503 |       |   |        | 33,141 |  
|                                                                 |                |                                   |         |        |      |   |        |        |      
|Paid related to                                                  |                |                                   |         |        |      |   |        |        |       |   |        |       
|Current year                                                     |                |                                   | 23,947  |        |      |   | 21,393 |        |       |   | 13,527 |       
|Prior years                                                      |                |                                   | 22,329  |        |      |   | 19,803 |        |       |   | 20,479 |       
|                                                                 |                |                                   |         |        |      |   |        |        |      
|                                                                 | Total paid     |                                   |         | 46,276 |      |   |        | 41,196 |       |   |        | 34,006 |  
|                                                                 |                |                                   |         |        |      |   |        |        |      
|Net balance, end of period                                       |                |                                   | 57,744  |        |      |   | 60,017 |        |       |   | 53,638 |       
|Plus: Reinsurance recoverables, excluding Citizens assessment(1) |                |                                   | 60,034  |        |      |   | 36,544 |        |       |   | 22,681 |       
|                                                                 |                |                                   |         |        |      |   |        |        |      
|Balance, end of period                                           |                | $                                 | 117,778 |        |      | $ | 96,561 |        |       | $ | 76,319 |       
|                                                                 |                |                                   |         |        |      |   |        |        |      






|    |                                                                                                                                                                                                                                                                                                                                                               
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Reinsurance recoverables excludes a $5,955,000 recoverable
    attributable to the liability established for the anticipated
    Citizens assessment (see Note 14). The liability for
    the Citizens assessment is not included in unpaid losses
    and loss adjustment expenses, therefore the related recoverable
    from reinsurers is also excluded.



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Notes to Consolidated
Financial Statements  (Continued)














|   |            
|-- | -----------
|8. | Reinsurance





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Notes to Consolidated
Financial Statements  (Continued)












|                          |  |                        |         |  |         |   |       |       |  |   |        |  |  |   |        | 
|------------------------- |  | ---------------------- | ------- |  | ------- | - | ----- | ----- |  | - | ------ |  |  | - | ------ | 
|                          |  | Direct                 |         |  | Assumed |   |       | Ceded |  |   | Net    | 
|                          |  |                        |         |  |         |   |       |       |  |   |        | 
|                          |  | (Dollars in thousands) |        
|2005                      |  |                        |         |  |         |   |       |       |  |   |        |  |  |   |        | 
|Premiums written          |  | $                      | 111,483 |  |         | $ | 613   |       |  | $ | 24,963 |  |  | $ | 87,133 | 
|Premiums earned           |  |                        | 108,358 |  |         |   | 1,288 |       |  |   | 24,910 |  |  |   | 84,736 | 
|Losses and LAE incurred   |  |                        | 101,485 |  |         |   | (735  | )     |  |   | 56,747 |  |  |   | 44,003 | 
|Losses and LAE reserves   |  |                        | 115,059 |  |         |   | 2,719 |       |  |   | 60,034 |  |  |   | 57,744 | 
|Unearned premium reserves |  |                        | 44,679  |  |         |   | 22    |       |  |   | 7,424  |  |  |   | 37,277 | 
|2004                      |  |                        |         |  |         |   |       |       |  |   |        |  |  |   |        | 
|Premiums written          |  | $                      | 94,548  |  |         | $ | 1,913 |       |  | $ | 15,968 |  |  | $ | 80,493 | 
|Premiums earned           |  |                        | 91,094  |  |         |   | 1,648 |       |  |   | 15,785 |  |  |   | 76,957 | 
|Losses and LAE incurred   |  |                        | 72,518  |  |         |   | (666  | )     |  |   | 30,349 |  |  |   | 41,503 | 
|Losses and LAE reserves   |  |                        | 92,103  |  |         |   | 4,458 |       |  |   | 36,544 |  |  |   | 60,017 | 
|Unearned premium reserves |  |                        | 41,553  |  |         |   | 698   |       |  |   | 5,551  |  |  |   | 36,700 | 
|2003                      |  |                        |         |  |         |   |       |       |  |   |        |  |  |   |        | 
|Premiums written          |  | $                      | 88,036  |  |         | $ | 167   |       |  | $ | 11,979 |  |  | $ | 76,224 | 
|Premiums earned           |  |                        | 80,009  |  |         |   | 1,939 |       |  |   | 13,208 |  |  |   | 68,740 | 
|Losses and LAE incurred   |  |                        | 34,573  |  |         |   | 496   |       |  |   | 1,928  |  |  |   | 33,141 | 
|Losses and LAE reserves   |  |                        | 72,610  |  |         |   | 3,709 |       |  |   | 22,681 |  |  |   | 53,638 | 
|Unearned premium reserves |  |                        | 38,099  |  |         |   | 433   |       |  |   | 5,368  |  |  |   | 33,164 | 

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Notes to Consolidated
Financial Statements  (Continued)




|                             |  |                        |        |  |      |   |        | 
|---------------------------- |  | ---------------------- | ------ |  | ---- | - | ------ | 
|                             |  | 2005                   |        |  | 2004 |  
|                             |  |                        |        |  |      |  
|                             |  | (Dollars in thousands) |       
|Paid losses and LAE          |  | $                      | 11,470 |  |      | $ | 8,214  | 
|Unpaid losses and LAE        |  |                        | 60,034 |  |      |   | 36,544 | 
|Citizens assessment         |  |                        | 5,955  |  |      |   |       | 
|Prepaid reinsurance premiums |  |                        | 7,424  |  |      |   | 5,551  | 
|                             |  |                        |        |  |      |  
|Amounts due from reinsurers  |  | $                      | 84,883 |  |      | $ | 50,309 | 
|                             |  |                        |        |  |      |  



|                                       |  |                        |        |  |      |   |        | 
|-------------------------------------- |  | ---------------------- | ------ |  | ---- | - | ------ | 
|                                       |  | 2005                   |        |  | 2004 |  
|                                       |  |                        |        |  |      |  
|                                       |  | (Dollars in thousands) |       
|Swiss Reinsurance American Corporation |  | $                      | 16,779 |  |      |   | 10,621 | 
|MCCA                                   |  |                        | 11,196 |  |      |   | 8,635  | 
|Florida Hurricane Catastrophe Fund     |  |                        | 7,210  |  |      |   |       | 
|QBE Reinsurance Corporation            |  |                        | 5,458  |  |      |   | 3,985  | 
|Folksamerica Reinsurance Company       |  |                        | 4,353  |  |      |   | 4,666  | 
|General Reinsurance Corporation        |  |                        | 3,533  |  |      |   | 4,358  | 
|Lloyds Syndicate 2001 AML              |  |                        | 3,396  |  |      |   | 1,230  | 
|Platinum Reinsurance Company           |  |                        | 2,672  |  |      |   | 3,144  | 
|Hannover Re Ltd                        |  |                        | 2,579  |  |      |   | 700    | 
|XL Reinsurance American, Inc           |  |                        | 2,533  |  |      |   | 1,659  | 
|Rosemont Reinsurance Ltd               |  |                        | 2,221  |  |      |   |       | 
|Axis Specialty Insurance Company       |  |                        | 2,189  |  |      |   |       | 
|Everest Reinsurance Company            |  |                        | 2,100  |  |      |   | 2,487  | 
|Shelter Mutual Insurance Company       |  |                        | 1,864  |  |      |   | 882    | 
|Lloyds Syndicate 2010 MMX              |  |                        | 1,782  |  |      |   | 1,246  | 
|Ace Tempest Reinsurance Ltd            |  |                        | 1,294  |  |      |   |       | 
|Catlin Insurance Company               |  |                        | 1,293  |  |      |   |       | 
|Transatlantic Reinsurance Company      |  |                        | 1,206  |  |      |   | 6      | 
|PXRE Reinsurance Company               |  |                        | 1,171  |  |      |   | 2,261  | 
|Other                                  |  |                        | 10,054 |  |      |   | 4,429  | 
|                                       |  |                        |        |  |      |  
|                                       |  | $                      | 84,883 |  |      | $ | 50,309 | 
|                                       |  |                        |        |  |      |  



|   |                   
|-- | ------------------
|9. | Federal Income Tax



|                                                             |                             |                                |       |     |       |   |       |      |       |   |        |     |       | 
|------------------------------------------------------------ | --------------------------- | ------------------------------ | ----- | --- | ----- | - | ----- | ---- | ----- | - | ------ | --- | ----- | 
|                                                             |                             | 2005                           |       |     | 2004  |   |       | 2003 |      
|                                                             |                             |                                |       |     |       |   |       |      |      
|                                                             |                             | (Dollars in thousands)         |      
|Current tax expense                                          |                             | $                              | 1,663 |     |       | $ | 2,540 |      |       | $ | 2,354  |    
|Deferred tax expense (benefit) relating to NOL carryforwards |                             |                                | 401   |     |       |   | 176   |      |       |   | 1,812  |    
|                                                             | Other deferred tax balances |                                |       | (36 | )     |   |       | 824  |       |   |        | 981 |      
|Change in valuation allowance                                |                             |                                |      |     |       |   | (24   | )    |       |   | (1,422 | )  
|                                                             |                             |                                |       |     |       |   |       |      |      
|                                                             |                             | Total provision for income tax |       | $   | 2,028 |   |       | $    | 3,516 |   |        | $   | 3,725 | 
|                                                             |                             |                                |       |     |       |   |       |      |      

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Notes to Consolidated
Financial Statements  (Continued)




|                                      |  |                        |       |   |      |   |       |      |  |   |       |  
|------------------------------------- |  | ---------------------- | ----- | - | ---- | - | ----- | ---- |  | - | ----- | -
|                                      |  | 2005                   |       |   | 2004 |   |       | 2003 | 
|                                      |  |                        |       |   |      |   |       |      | 
|                                      |  | (Dollars in thousands) |      
|Tax provision at statutory rate 34.0% |  | $                      | 1,999 |   |      | $ | 4,095 |      |  | $ | 3,500 |  
|Tax effect of                         |  |                        |       |   |      |   |       |      |  |   |       |  
|Dividend received deduction           |  |                        | (30   | ) |      |   | (61   | )    |  |   | (39   | )
|Adjustment of acquired NOLs           |  |                        | 262   |   |      |   | (249  | )    |  |   | 204   |  
|Provision to return variance          |  |                        | (284  | ) |      |   | (300  | )    |  |   |      |  
|Other, net                            |  |                        | 81    |   |      |   | 31    |      |  |   | 60    |  
|                                      |  |                        |       |   |      |   |       |      | 
|                                      |  | $                      | 2,028 |   |      | $ | 3,516 |      |  | $ | 3,725 |  
|                                      |  |                        |       |   |      |   |       |      | 





|                                        |                                |                        |       |       |      |   |       |       | 
|--------------------------------------- | ------------------------------ | ---------------------- | ----- | ----- | ---- | - | ----- | ----- | 
|                                        |                                | 2005                   |       |       | 2004 |  
|                                        |                                |                        |       |       |      |  
|                                        |                                | (Dollars in thousands) |      
|Deferred federal income tax assets      |                                |                        |       |       |      |   |       |      
|Losses and loss adjustment expenses     |                                | $                      | 2,445 |       |      | $ | 2,496 |      
|Unearned premiums                       |                                |                        | 2,659 |       |      |   | 2,531 |      
|Net operating loss carryforwards        |                                |                        | 2,629 |       |      |   | 3,293 |      
|Premiums receivable                     |                                |                        | 85    |       |      |   | 109   |      
|Lease obligation                        |                                |                        | 165   |       |      |   | 211   |      
|Intangible asset                        |                                |                        | 340   |       |      |   | 374   |      
|Net unrealized losses on investments    |                                |                        | 340   |       |      |   |      |      
|Citizens assessment                    |                                |                        | 186   |       |      |   |      |      
|Other                                   |                                |                        | 389   |       |      |   | 256   |      
|                                        |                                |                        |       |       |      |  
|                                        | Total deferred tax assets      |                        |       | 9,238 |      |   |       | 9,270 | 
|                                        |                                |                        |       |       |      |  
|Deferred federal income tax liabilities |                                |                        |       |       |      |   |       |      
|Deferred policy acquisition costs       |                                |                        | 3,257 |       |      |   | 3,329 |      
|Net unrealized gains on investments     |                                |                        |      |       |      |   | 3     |      
|Other                                   |                                |                        | 138   |       |      |   | 73    |      
|                                        | Total deferred tax liabilities |                        |       | 3,395 |      |   |       | 3,405 | 
|                                        |                                |                        |       |       |      |  
|Net deferred federal income tax assets  |                                | $                      | 5,843 |       |      | $ | 5,865 |      
|                                        |                                |                        |       |       |      |  



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Notes to Consolidated
Financial Statements  (Continued)




|                       |       |      |            |  |         |            |  |  |      | 
|---------------------- | ----- | ---- | ---------- |  | ------- | ---------- |  |  | ---- | 
|                       |       | Year |            |  | Year of |           
|NOL Carryforwards      |       |      | Originated |  |         | Expiration | 
|                       |       |      |            |  |         |            | 
|(Dollars in thousands) |       |      |            |  |        
|$                      | 94    |      |            |  | 1996    |            |  |  | 2010 | 
|                       | 264   |      |            |  | 1997    |            |  |  | 2011 | 
|                       | 2,291 |      |            |  | 1999    |            |  |  | 2018 | 
|                       | 1,392 |      |            |  | 2000    |            |  |  | 2019 | 
|                       | 3,693 |      |            |  | 2001    |            |  |  | 2020 | 
|                       |       |      |            |  |         |            | 
|$                      | 7,734 |      |            |  |         |            |  |  |      | 
|                       |       |      |            |  |         |            | 



|    |                     
|--- | --------------------
|10. | Shareholders Equity



| |             
| | ------------
| | Common Stock

















| |                
| | ---------------
| | Preferred Stock







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Notes to Consolidated
Financial Statements  (Continued)




Redemption Rights


Conversion Rights


Liquidation Rights


Other Preferred Share Requirements


Warrants




|    |                           
|--- | --------------------------
|11. | Stock  Based Compensation



| |              
| | -------------
| | Stock Options





|                                          |  |   |             |  
|----------------------------------------- |  | - | ----------- | -
|Fair value of the underlying common stock |  | $ | 12.00/share |  
|Weighted average life of options          |  |   | 5.00 years  |  
|Risk-free interest rate                   |  |   | 4.13        | %
|Dividend yield                            |  |   | 0.00        | %
|Weighted average volatility assumption    |  |   | 30.20       | %





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Notes to Consolidated
Financial Statements  (Continued)




| |                 
| | ----------------
| | Restricted Stock





|    |     
|--- | ----
|12. | Debt



| |                       
| | ----------------------
| | Senior Credit Facility













| |   |                                                                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | adjusted capital and surplus in excess of 215% of authorized
    control level risk-based capital as of each fiscal year
    end; and                                                        
|
| |  | a ratio of net premiums written to statutory capital and surplus
    of not more than 2.50 to 1.0 and a ratio of gross premiums
    written to statutory surplus of not more than 3.0 to 1.0.





| |                         
| | ------------------------
| | Mortgage Debt Obligation



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Notes to Consolidated
Financial Statements  (Continued)






|                    |            |                        |       |       | 
|------------------- | ---------- | ---------------------- | ----- | ----- | 
|Year                |            | Amount                 |      
|                    |            |                        |      
|                    |            | (Dollars in thousands) |      
|2006                |            | $                      | 2,515 |      
|2007                |            |                        | 122   |      
|2008                |            |                        | 130   |      
|2009                |            |                        | 138   |      
|2010 and thereafter |            |                        | 2,121 |      
|                    |            |                        |      
|                    | Total debt |                        | $     | 5,026 | 
|                    |            |                        |      



|    |                                       
|--- | --------------------------------------
|13. | Commitments and Contingent Liabilities



|           |  |                        |       |  |          |   |      |             |  |   |       | 
|---------- |  | ---------------------- | ----- |  | -------- | - | ---- | ----------- |  | - | ----- | 
|           |  | Minimum                |       |  | Minimum  |   |      |            
|           |  | Lease                  |       |  | Sublease |   |      | Net Future  | 
|Year Ended |  | Commitments            |       |  | Revenue  |   |      | Commitments | 
|           |  |                        |       |  |          |   |      |             | 
|           |  | (Dollars in thousands) |      
|2006       |  | $                      | 714   |  |          | $ | (232 | )           |  | $ | 482   | 
|2007       |  |                        | 730   |  |          |   | (244 | )           |  |   | 486   | 
|2008       |  |                        | 682   |  |          |   | (251 | )           |  |   | 431   | 
|2009       |  |                        | 413   |  |          |   | (174 | )           |  |   | 239   | 
|           |  |                        |       |  |          |   |      |             | 
|           |  | $                      | 2,539 |  |          | $ | (901 | )           |  | $ | 1,638 | 
|           |  |                        |       |  |          |   |      |             | 







|    |                                     
|--- | ------------------------------------
|14. | Guaranty Funds and State Assessments









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Notes to Consolidated
Financial Statements  (Continued)










|    |                           
|--- | --------------------------
|15. | Related Party Transactions















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Notes to Consolidated
Financial Statements  (Continued)








|    |                           
|--- | --------------------------
|16. | 401(k) Profit Sharing Plan





|    |                   
|--- | ------------------
|17. | Earnings Per Share



|                                                                         |                            |                                           |           |       |      |   |           |        |  |   |           |       | 
|------------------------------------------------------------------------ | -------------------------- | ----------------------------------------- | --------- | ----- | ---- | - | --------- | ------ |  | - | --------- | ----- | 
|                                                                         |                            | 2005                                      |           |       | 2004 |   |           | 2003   | 
|                                                                         |                            |                                           |           |       |      |   |           |        | 
|                                                                         |                            | (Dollars in thousands, except share data) |          
|Net income (used for diluted EPS)                                        |                            | $                                         | 3,850     |       |      | $ | 11,433    |        |  | $ | 6,569     |      
|Purchase price of redeemable preferred stock in excess of face
    value |                            |                                           |          |       |      |   | (888      | )      |  |   |          |      
|Preferred dividends                                                      |                            |                                           |          |       |      |   | (80       | )      |  |   | (160      | )    
|                                                                         |                            |                                           |           |       |      |   |           |        | 
|                                                                         | Income used for basic EPS  |                                           | $         | 3,850 |      |   | $         | 10,465 |  |   | $         | 6,409 | 
|                                                                         |                            |                                           |           |       |      |   |           |        | 
|Weighted average shares outstanding used for basic EPS                   |                            |                                           | 6,014,050 |       |      |   | 5,052,171 |        |  |   | 5,503,893 |      
|Effect of dilutive securities                                            |                            |                                           |           |       |      |   |           |        |  |   |           |      
|Redeemable cumulative preferred stock                                    |                            |                                           |          |       |      |   | 673,674   |        |  |   | 1,474,579 |      
|Warrants                                                                 |                            |                                           |          |       |      |   | 134,735   |        |  |   | 294,915   |      
|Restricted stock                                                         |                            |                                           | 168       |       |      |   |          |        |  |   |          |      
|                                                                         |                            |                                           |           |       |      |   |           |        | 
|Diluted weighted average shares outstanding                              |                            |                                           | 6,014,218 |       |      |   | 5,860,580 |        |  |   | 7,273,387 |      
|                                                                         |                            |                                           |           |       |      |   |           |        | 
|Basic earnings per share                                                 |                            | $                                         | 0.64      |       |      | $ | 2.07      |        |  | $ | 1.16      |      
|                                                                         | Diluted earnings per share |                                           | $         | 0.64  |      |   | $         | 1.95   |  |   | $         | 0.90  | 







|    |                                                       
|--- | ------------------------------------------------------
|18. | Statutory Capital and Surplus and Restrictions Thereon



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Financial Statements  (Continued)


















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Notes to Consolidated
Financial Statements  (Continued)




|                              |  |                        |        |   |      |   |        |      |  |   |        | 
|----------------------------- |  | ---------------------- | ------ | - | ---- | - | ------ | ---- |  | - | ------ | 
|                              |  | 2005                   |        |   | 2004 |   |        | 2003 | 
|                              |  |                        |        |   |      |   |        |      | 
|                              |  | (Dollars in thousands) |       
|Statutory capital and surplus |  |                        |        |   |      |   |        |      |  |   |        | 
|North Pointe Insurance        |  | $                      | 43,861 |   |      | $ | 32,882 |      |  | $ | 29,706 | 
|North Pointe Casualty         |  |                        | 12,714 |   |      |   | 15,018 |      |  |   |       | 
|Home Pointe Insurance         |  |                        | 7,333  |   |      |   |       |      |  |   |       | 
|Midfield Insurance            |  |                        | 5,828  |   |      |   |       |      |  |   |       | 
|Statutory net income (loss)   |  |                        |        |   |      |   |        |      |  |   |        | 
|North Pointe Insurance        |  | $                      | 7,053  |   |      | $ | 2,826  |      |  | $ | 1,769  | 
|North Pointe Casualty         |  |                        | (6,425 | ) |      |   | (500   | )    |  |   |       | 
|Home Pointe Insurance         |  |                        | (225   | ) |      |   |       |      |  |   |       | 
|Midfield Insurance            |  |                        | 617    |   |      |   |       |      |  |   |       | 





written-to-surplus






|    |                 
|--- | ----------------
|19. | Subsequent Event



| |                                       
| | --------------------------------------
| | Issuance of Trust Preferred Securities

30-year,






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Notes to Consolidated
Financial Statements  (Continued)








|    |                    
|--- | -------------------
|20. | Segment Information













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Notes to Consolidated
Financial Statements  (Continued)




|                                                                           |                              |                               |       |         |        |   |        |         |        |   |        |         |        |  
|-------------------------------------------------------------------------- | ---------------------------- | ----------------------------- | ----- | ------- | ------ | - | ------ | ------- | ------ | - | ------ | ------- | ------ | -
|                                                                           |                              | 2005                          |       |         | 2004   |   |        | 2003    |       
|                                                                           |                              |                               |       |         |        |   |        |         |       
|                                                                           |                              | (Dollars in thousands)        |      
|Total revenues                                                             |                              |                               |       |         |        |   |        |         |        |   |        |        
|Commercial lines products                                                  |                              |                               |       |         |        |   |        |         |        |   |        |        
|                                                                           | Liability                    |                               | $     | 23,720  |        |   | $      | 21,551  |        |   | $      | 17,795  |       
|                                                                           | Property                     |                               |       | 6,299   |        |   |        | 7,128   |        |   |        | 5,258   |       
|                                                                           | Commercial multi-peril       |                               |       | 22,230  |        |   |        | 18,968  |        |   |        | 13,313  |       
|                                                                           | Commercial automobile        |                               |       | 6,156   |        |   |        | 5,412   |        |   |        | 6,928   |       
|                                                                           | Other                        |                               |       | 2,661   |        |   |        | 2,276   |        |   |        | 2,182   |       
|                                                                           |                              |                               |       |         |        |   |        |         |       
|                                                                           |                              | Total commercial lines        |       |         | 61,066 |   |        |         | 55,335 |   |        |         | 45,476 |  
|Personal lines products                                                    |                              |                               |       |         |        |   |        |         |        |   |        |        
|                                                                           | Personal automobile          |                               |       | 1,459   |        |   |        | 15,110  |        |   |        | 16,674  |       
|                                                                           | Homeowners                   |                               |       | 22,211  |        |   |        | 6,512   |        |   |        | 6,590   |       
|                                                                           |                              |                               |       |         |        |   |        |         |       
|                                                                           |                              | Total personal lines          |       |         | 23,670 |   |        |         | 21,622 |   |        |         | 23,264 |  
|Administrative services                                                    |                              |                               |       |         |        |   |        |         |        |   |        |        
|                                                                           | Affiliated companies         |                               |       | 33,394  |        |   |        | 25,598  |        |   |        | 22,467  |       
|                                                                           | Nonaffiliated companies      |                               |       | 1,903   |        |   |        | 2,222   |        |   |        | 2,047   |       
|                                                                           |                              |                               |       |         |        |   |        |         |       
|                                                                           |                              | Total administrative services |       |         | 35,297 |   |        |         | 27,820 |   |        |         | 24,514 |  
|Corporate and eliminations                                                 |                              |                               |       |         |        |   |        |         |        |   |        |        
|                                                                           | Investment activity          |                               |       | 3,835   |        |   |        | 3,263   |        |   |        | 3,438   |       
|                                                                           | Sales of businesses          |                               |       |        |        |   |        | 4,285   |        |   |        | 200     |       
|                                                                           | Eliminations                 |                               |       | (33,394 | )      |   |        | (25,598 | )      |   |        | (22,467 | )     
|                                                                           |                              |                               |       |         |        |   |        |         |       
|                                                                           |                              | Total revenues                |       | $       | 90,474 |   |        | $       | 86,727 |   |        | $       | 74,425 |  
|                                                                           |                              |                               |       |         |        |   |        |         |       
|Income (loss) before federal income tax expense and
    extraordinary item |                              |                               |       |         |        |   |        |         |        |   |        |        
|Commercial lines products                                                  |                              |                               |       |         |        |   |        |         |        |   |        |        
|                                                                           | Liability                    |                               | $     | 3,033   |        |   | $      | 2,652   |        |   | $      | 3,095   |       
|                                                                           | Property                     |                               |       | (2,086  | )      |   |        | (536    | )      |   |        | 867     |       
|                                                                           | Commercial multi-peril       |                               |       | (1,299  | )      |   |        | 153     |        |   |        | 706     |       
|                                                                           | Commercial automobile        |                               |       | (637    | )      |   |        | 1,109   |        |   |        | 936     |       
|                                                                           | Other                        |                               |       | 343     |        |   |        | (1,270  | )      |   |        | 327     |       
|                                                                           |                              |                               |       |         |        |   |        |         |       
|                                                                           |                              | Total commercial lines        |       |         | (646   | ) |        |         | 2,108  |   |        |         | 5,931  |  
|Personal lines products                                                    |                              |                               |       |         |        |   |        |         |        |   |        |        
|                                                                           | Personal automobile          |                               |       | 400     |        |   |        | (1,932  | )      |   |        | (3,467  | )     
|                                                                           | Homeowners                   |                               |       | (2,424  | )      |   |        | 270     |        |   |        | 340     |       
|                                                                           |                              |                               |       |         |        |   |        |         |       
|                                                                           |                              | Total personal lines          |       |         | (2,024 | ) |        |         | (1,662 | ) |        |         | (3,127 | )
|Administrative services                                                    |                              |                               | 7,040 |         |        |   | 5,920  |         |        |   | 4,896  |        
|Corporate                                                                  |                              |                               |       |         |        |   |        |         |        |   |        |        
|                                                                           | Investment activity          |                               |       | 3,835   |        |   |        | 3,263   |        |   |        | 3,438   |       
|                                                                           | Gains on sales of businesses |                               |       |        |        |   |        | 4,285   |        |   |        | 200     |       
|                                                                           | Other expense, net           |                               |       | (2,327  | )      |   |        | (1,870  | )      |   |        | (1,044  | )     
|                                                                           |                              |                               |       |         |        |   |        |         |       
|Total income before federal income tax expense and extraordinary
    item  |                              | $                             | 5,878 |         |        | $ | 12,044 |         |        | $ | 10,294 |        
|                                                                           |                              |                               |       |         |        |   |        |         |       

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North Pointe Holdings Corporation


Schedule I


Summary of Investments  Other than Investments in
Related Parties


|                   |                         |                        |                                         |                |            |        |     |         |   |        |     |         |   |        | 
|------------------ | ----------------------- | ---------------------- | --------------------------------------- | -------------- | ---------- | ------ | --- | ------- | - | ------ | --- | ------- | - | ------ | 
|                   |                         | December 31, 2005      |                                        
|                   |                         |                        |                                        
|                   |                         |                        |                                         | Amount at      |           
|                   |                         |                        |                                         | Which Shown    |           
|                   |                         |                        |                                         | in the Balance |           
|                   |                         | Cost                   |                                         |                | Fair Value |        |     | Sheet   |  
|                   |                         |                        |                                         |                |            |        |     |         |  
|                   |                         | (Dollars in thousands) |                                        
|Fixed Maturities:  |                         |                        |                                         |                |            |        |     |         |   |        |     |        
|                   |                         | Bonds:                 |                                         |                |            |        |     |         |   |        |     |         |   |       
|                   |                         |                        | U.S. government and agency securities   |                | $          | 21,113 |     |         | $ | 20,672 |     |         | $ | 20,672 | 
|                   |                         |                        | Foreign government securities           |                |            | 575    |     |         |   | 561    |     |         |   | 561    | 
|                   |                         |                        | Corporate bonds                         |                |            | 32,366 |     |         |   | 31,509 |     |         |   | 31,509 | 
|                   |                         |                        | Mortgage-backed securities              |                |            | 33,735 |     |         |   | 32,847 |     |         |   | 32,847 | 
|                   |                         |                        | Asset-backed securities                 |                |            | 12,548 |     |         |   | 12,429 |     |         |   | 12,429 | 
|                   |                         |                        |                                         |                |            |        |     |         |  
|                   | Total fixed maturities  |                        |                                         | 100,337        |            |        |     | 98,018  |   |        |     | 98,018  |  
|Equity Securities: |                         |                        |                                         |                |            |        |     |         |   |        |     |        
|                   |                         | Common stocks          |                                         |                |            |        |     |         |   |        |     |         |   |       
|                   |                         |                        | Public utilities                        |                |            | 275    |     |         |   | 328    |     |         |   | 328    | 
|                   |                         |                        | Banks, trust and insurance companies    |                |            | 1,343  |     |         |   | 1,470  |     |         |   | 1,470  | 
|                   |                         |                        | Industrial, miscellaneous and all other |                |            | 7,063  |     |         |   | 8,203  |     |         |   | 8,203  | 
|                   |                         |                        |                                         |                |            |        |     |         |  
|                   | Total equity securities |                        |                                         | 8,681          |            |        |     | 10,001  |   |        |     | 10,001  |  
|Other Investments  |                         |                        | 553                                     |                |            |        | 553 |         |   |        | 553 |        
|                   |                         |                        |                                         |                |            |        |     |         |  
|                   | Total investments       |                        | $                                       | 109,571        |            |        | $   | 108,572 |   |        | $   | 108,572 |  
|                   |                         |                        |                                         |                |            |        |     |         |  

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North Pointe Holdings Corporation (Parent Company Only)


Schedule II  Condensed Financial Information
of Registrant


Condensed Balance Sheets


|                                                                     |                                        |                        |        |        |      |   |        |        | 
|-------------------------------------------------------------------- | -------------------------------------- | ---------------------- | ------ | ------ | ---- | - | ------ | ------ | 
|                                                                     |                                        | December 31,           |       
|                                                                     |                                        |                        |       
|                                                                     |                                        | 2005                   |        |        | 2004 |  
|                                                                     |                                        |                        |        |        |      |  
|                                                                     |                                        | (Dollars in thousands) |       
|ASSETS                                                              
|Investment in subsidiaries*                                          |                                        | $                      | 74,803 |        |      | $ | 56,052 |       
|Federal income taxes  current                                       |                                        |                        | 2,758  |        |      |   | 878    |       
|Federal income taxes  deferred                                      |                                        |                        | 57     |        |      |   | 111    |       
|Due from affiliates*                                                 |                                        |                        | 6,891  |        |      |   |       |       
|Other assets                                                         |                                        |                        | 184    |        |      |   | 791    |       
|                                                                     |                                        |                        |        |        |      |  
|Total assets                                                         |                                        | $                      | 84,693 |        |      | $ | 57,832 |       
|                                                                     |                                        |                        |        |        |      |  
|                                                                    
|LIABILITIES, REDEEMABLE PREFERRED STOCK AND
    SHAREHOLDERS EQUITY
|Accounts payable and accrued expenses                                |                                        | $                      | 66     |        |      | $ | 154    |       
|Due to affiliates*                                                   |                                        |                        |       |        |      |   | 2,924  |       
|Debt                                                                 |                                        |                        | 2,400  |        |      |   | 20,062 |       
|                                                                     |                                        |                        |        |        |      |  
|Total liabilities                                                    |                                        |                        | 2,466  |        |      |   | 23,140 |       
|                                                                     |                                        |                        |        |        |      |  
|Redeemable cumulative convertible preferred stock                    |                                        |                        |       |        |      |   |       |       
|Shareholders equity:                                                |                                        |                        |        |        |      |   |        |       
|                                                                     | Common stock                           |                        |        | 50,233 |      |   |        | 5,880  | 
|                                                                     | Preferred stock                        |                        |        |       |      |   |        |       | 
|                                                                     | Retained earnings                      |                        |        | 32,653 |      |   |        | 28,803 | 
|                                                                     | Accumulated other comprehensive income |                        |        | (659   | )    |   |        | 9      | 
|                                                                     |                                        |                        |        |        |      |  
|Total shareholders equity                                           |                                        |                        | 82,227 |        |      |   | 34,692 |       
|                                                                     |                                        |                        |        |        |      |  
|Total liabilities and shareholders equity                           |                                        | $                      | 84,693 |        |      | $ | 57,832 |       
|                                                                     |                                        |                        |        |        |      |  






|  |                             
|- | ----------------------------
|* | Eliminated in consolidation.







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North Pointe Holdings Corporation (Parent Company Only)


Schedule II  Condensed Financial Information
of Registrant  (Continued)


Condensed Statements of Income


|                                                                                         |  |                        |       |   |      |   |        |      |  |   |       |  
|---------------------------------------------------------------------------------------- |  | ---------------------- | ----- | - | ---- | - | ------ | ---- |  | - | ----- | -
|                                                                                         |  | Years Ended            |      
|                                                                                         |  |                        |      
|                                                                                         |  | 2005                   |       |   | 2004 |   |        | 2003 | 
|                                                                                         |  |                        |       |   |      |   |        |      | 
|                                                                                         |  | (Dollars in thousands) |      
|Revenues                                                                                 |  |                        |       |   |      |   |        |      |  |   |       |  
|Dividends from subsidiaries*                                                             |  | $                      | 6,000 |   |      | $ | 5,000  |      |  | $ | 3,210 |  
|Gain on sale of consolidated subsidiary                                                  |  |                        |      |   |      |   |       |      |  |   | 615   |  
|                                                                                         |  |                        |       |   |      |   |        |      | 
|                                                                                         |  |                        | 6,000 |   |      |   | 5,000  |      |  |   | 3,825 |  
|                                                                                         |  |                        |       |   |      |   |        |      | 
|Expenses                                                                                 |  |                        |       |   |      |   |        |      |  |   |       |  
|Interest expense                                                                         |  |                        | 899   |   |      |   | 763    |      |  |   | 407   |  
|Other operating costs and expenses                                                       |  |                        | 1,485 |   |      |   | 508    |      |  |   | 531   |  
|                                                                                         |  |                        |       |   |      |   |        |      | 
|                                                                                         |  |                        | 2,384 |   |      |   | 1,271  |      |  |   | 938   |  
|                                                                                         |  |                        |       |   |      |   |        |      | 
|Income before income tax benefit and equity in earnings of
    consolidated subsidiaries |  |                        | 3,616 |   |      |   | 3,729  |      |  |   | 2,887 |  
|Income tax benefit                                                                       |  |                        | (814  | ) |      |   | (308   | )    |  |   | (417  | )
|                                                                                         |  |                        |       |   |      |   |        |      | 
|Income before equity in undistributed earnings of subsidiaries                           |  |                        | 4,430 |   |      |   | 4,037  |      |  |   | 3,304 |  
|Equity in undistributed net (loss) income of consolidated
    subsidiaries*              |  |                        | (580  | ) |      |   | 4,491  |      |  |   | 3,265 |  
|Extraordinary item                                                                       |  |                        |      |   |      |   | 2,905  |      |  |   |      |  
|                                                                                         |  |                        |       |   |      |   |        |      | 
|Net income                                                                               |  | $                      | 3,850 |   |      | $ | 11,433 |      |  | $ | 6,569 |  
|                                                                                         |  |                        |       |   |      |   |        |      | 






|  |                             
|- | ----------------------------
|* | Eliminated in consolidation.







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North Pointe Holdings Corporation (Parent Company Only)


Schedule II  Condensed Financial Information
of Registrant  (Continued)


Condensed Statements of Shareholders Equity


and Comprehensive Income


|                                            |                                |                        |        |       |      |   |        |        |   |   |        |       |  
|------------------------------------------- | ------------------------------ | ---------------------- | ------ | ----- | ---- | - | ------ | ------ | - | - | ------ | ----- | -
|                                            |                                | Years Ended            |       
|                                            |                                |                        |       
|                                            |                                | 2005                   |        |       | 2004 |   |        | 2003   |  
|                                            |                                |                        |        |       |      |   |        |        |  
|                                            |                                | (Dollars in thousands) |       
|Shareholders equity as of December 31,     |                                | $                      | 34,692 |       |      | $ | 26,093 |        |   | $ | 20,666 |      
|Issuance of stock                           |                                |                        | 44,270 |       |      |   | 95     |        |   |   | 150    |      
|Change in stock-based employee compensation |                                |                        | 83     |       |      |   |       |        |   |   |       |      
|Purchase and retirement of common stock     |                                |                        |       |       |      |   | (1,600 | )      |   |   | (930   | )    
|Purchase and retirement of preferred stock  |                                |                        |       |       |      |   | (888   | )      |   |   |       |      
|Preferred stock dividends                   |                                |                        |       |       |      |   | (80    | )      |   |   | (160   | )    
|Comprehensive income                        |                                |                        |        |       |      |   |        |        |   |   |        |      
|                                            | Net income                     |                        |        | 3,850 |      |   |        | 11,433 |   |   |        | 6,569 |  
|                                            | Unrealized loss on investments |                        |        | (668  | )    |   |        | (361   | ) |   |        | (202  | )
|                                            |                                |                        |        |       |      |   |        |        |  
|Total comprehensive income                  |                                |                        | 3,182  |       |      |   | 11,072 |        |   |   | 6,367  |      
|                                            |                                |                        |        |       |      |   |        |        |  
|Shareholders equity as of December 31,     |                                | $                      | 82,227 |       |      | $ | 34,692 |        |   | $ | 26,093 |      
|                                            |                                |                        |        |       |      |   |        |        |  







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North Pointe Holdings Corporation (Parent Company Only)


Schedule II  Condensed Financial Information
of Registrant  (Continued)


Condensed Statement of Cash Flows


|                                                                                                |                                       |                        |         |        |      |   |         |       |   |   |         |        |  
|----------------------------------------------------------------------------------------------- | ------------------------------------- | ---------------------- | ------- | ------ | ---- | - | ------- | ----- | - | - | ------- | ------ | -
|                                                                                                |                                       | For the Years Ended    |        
|                                                                                                |                                       |                        |        
|                                                                                                |                                       | 2005                   |         |        | 2004 |   |         | 2003  |  
|                                                                                                |                                       |                        |         |        |      |   |         |       |  
|                                                                                                |                                       | (Dollars in thousands) |        
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                           |                                       |                        |         |        |      |   |         |       |   |   |         |       
|Net income                                                                                      |                                       | $                      | 3,850   |        |      | $ | 11,433  |       |   | $ | 6,569   |       
|Adjustments to reconcile net income to net cash (used in)
    provided by operating activities: |                                       |                        |         |        |      |   |         |       |   |   |         |       
|Extraordinary item                                                                              |                                       |                        |        |        |      |   | (2,905  | )     |   |   |        |       
|Equity in undistributed loss (income) of consolidated
    subsidiaries                          |                                       |                        | 580     |        |      |   | (4,491  | )     |   |   | (3,265  | )     
|Unearned stock compensation                                                                     |                                       |                        | 82      |        |      |   |        |       |   |   | (615    | )     
|Changes in:                                                                                     |                                       |                        |         |        |      |   |         |       |   |   |         |       
|                                                                                                | Other assets                          |                        |         | 766    |      |   |         | (764  | ) |   |         |       |  
|                                                                                                | Intercompany receivable or payable    |                        |         | (9,815 | )    |   |         | 2,936 |   |   |         | (1,460 | )
|                                                                                                | Accounts payable and accrued expenses |                        |         | (88    | )    |   |         | 127   |   |   |         | (19    | )
|                                                                                                | Income taxes                          |                        |         | (1,826 | )    |   |         | (171  | ) |   |         | (554   | )
|                                                                                                |                                       |                        |         |        |      |   |         |       |  
|Net cash (used in) provided by operating activities                                             |                                       |                        | (6,451  | )      |      |   | 6,165   |       |   |   | 656     |       
|CASH FLOWS FROM INVESTING ACTIVITIES:                                                           |                                       |                        |         |        |      |   |         |       |   |   |         |       
|Contributions to subsidiaries                                                                   |                                       |                        | (20,000 | )      |      |   | (10,898 | )     |   |   | (1,787  | )     
|Proceeds from sale of subsidiary                                                                |                                       |                        |        |        |      |   |        |       |   |   | 2,198   |       
|                                                                                                |                                       |                        |         |        |      |   |         |       |  
|Net cash provided by (used in) investing activities                                             |                                       |                        | (20,000 | )      |      |   | (10,898 | )     |   |   | 411     |       
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                           |                                       |                        |         |        |      |   |         |       |   |   |         |       
|Proceeds from issuance of common stock                                                          |                                       |                        | 44,270  |        |      |   | 95      |       |   |   | 150     |       
|Purchase and retirement of common stock                                                         |                                       |                        |        |        |      |   | (1,600  | )     |   |   | (930    | )     
|Purchase and retirement of preferred stock                                                      |                                       |                        |        |        |      |   | (2,888  | )     |   |   |        |       
|Proceeds from issuance of bank debt                                                             |                                       |                        | 38,014  |        |      |   | 22,059  |       |   |   | 9,960   |       
|Repayment of bank debt                                                                          |                                       |                        | (55,676 | )      |      |   | (12,845 | )     |   |   | (10,079 | )     
|Preferred dividends paid                                                                        |                                       |                        |        |        |      |   | (80     | )     |   |   | (160    | )     
|                                                                                                |                                       |                        |         |        |      |   |         |       |  
|Net cash (used in) provided by financing activities                                             |                                       |                        | 26,608  |        |      |   | 4,741   |       |   |   | (1,059  | )     
|                                                                                                |                                       |                        |         |        |      |   |         |       |  
|Change in cash                                                                                  |                                       |                        | 157     |        |      |   | 8       |       |   |   | 8       |       
|Cash, beginning of year                                                                         |                                       |                        | 27      |        |      |   | 19      |       |   |   | 11      |       
|                                                                                                |                                       |                        |         |        |      |   |         |       |  
|Cash, end of year                                                                               |                                       | $                      | 184     |        |      | $ | 27      |       |   | $ | 19      |       
|                                                                                                |                                       |                        |         |        |      |   |         |       |  







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North Pointe Holdings Corporation (Parent Company Only)


Schedule II  Condensed Financial Information
of Registrant  (Continued)


Notes to Condensed Financial Statements








103



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##### Table of Contents



North Pointe Holdings Corporation and Subsidiaries




Schedule III


Supplementary Insurance Information


For the Year Ended December 31, 2005


|                          |       |                        |       |               |            |   |        |          |        |        |          |        |         |   |   |   |  |   |        |        | 
|------------------------- | ----- | ---------------------- | ----- | ------------- | ---------- | - | ------ | -------- | ------ | ------ | -------- | ------ | ------- | - | - | - |  | - | ------ | ------ | 
|(A)                       |       | (B)                    |       |               | (C)        |   |        | (D)      |        |        | (E)      |        | (F)     |  
|                          |       |                        |       |               |            |   |        |          |        |        |          |        |         |  
|                          |       |                        |       | Future Policy |            |   |        |          | Other  |        |         
|                          |       |                        |       | Benefits,     |            |   |        |          | Policy |        |         
|                          |       | Deferred               |       |               | Losses,    |   |        |          |        | Claims |          |       
|                          |       | Policy                 |       |               | Claims and |   |        |          |        | and    |          |       
|                          |       | Acquisition            |       |               | Loss       |   |        | Unearned |        |        | Benefits |        | Premium |  
|Segment                   |       | Costs                  |       |               | Expenses   |   |        | Premiums |        |        | Payable  |        | Revenue |  
|                          |       |                        |       |               |            |   |        |          |        |        |          |        |         |  
|                          |       | (Dollars in thousands) |      
|Personal lines            |       | $                      | 1,241 |               |            | $ | 35,663 |          |        | $      | 5,709    |        |         | $ |  |   |  | $ | 23,670 |       
|Commercial lines          |       |                        | 8,337 |               |            |   | 82,115 |          |        |        | 38,992   |        |         |   |  |   |  |   | 61,066 |       
|Administrative operations |       |                        |      |               |            |   |       |          |        |        |         |        |         |   |  |   |  |   |       |       
|                          |       |                        |       |               |            |   |        |          |        |        |          |        |         |   |  
|                          | Total |                        | $     | 9,578         |            |   | $      | 117,778  |        |        | $        | 44,701 |         |   | $ |  |  |   | $      | 84,736 | 
|                          |       |                        |       |               |            |   |        |          |        |        |          |        |         |   |  

|                          |       |                        |       |           |            |              |             |             |  |   |           |        |  |          |         |        |  |   |        |        | 
|------------------------- | ----- | ---------------------- | ----- | --------- | ---------- | ------------ | ----------- | ----------- |  | - | --------- | ------ |  | -------- | ------- | ------ |  | - | ------ | ------ | 
|(A)                       |       | (G)                    |       |           | (H)        |              |             | (I)         |  |   | (J)       |        |  | (K)      |        
|                          |       |                        |       |           |            |              |             |             |  |   |           |        |  |          |        
|                          |       |                        |       |           |            | Amortization |             |             |  |   |          
|                          |       |                        |       | Benefits, |            |              | of Deferred |             |  |   |           |       
|                          |       | Net                    |       |           | Claims,    |              |             | Policy      |  |   | Other     |        |  | Net      |        
|                          |       | Investment             |       |           | Settlement |              |             | Acquisition |  |   | Operating |        |  | Premiums |        
|Segment                   |       | Income                 |       |           | Expenses   |              |             | Costs       |  |   | Expenses  |        |  | Written  |        
|                          |       |                        |       |           |            |              |             |             |  |   |           |        |  |          |        
|                          |       | (Dollars in thousands) |      
|Personal lines            |       | $                      |      |           |            | $            | 14,798      |             |  | $ | 6,835     |        |  | $        | 4,060   |        |  | $ | 23,844 |       
|Commercial lines          |       |                        |      |           |            |              | 29,205      |             |  |   | 17,634    |        |  |          | 14,874  |        |  |   | 63,289 |       
|Administrative operations |       |                        |      |           |            |              |            |             |  |   | 19,067    |        |  |          | 9,081   |        |  |   |       |       
|Corporate                 |       |                        | 4,003 |           |            |              |            |             |  |   |          |        |  |          | 1,472   |        |  |   |       |       
|Eliminations              |       |                        |      |           |            |              |            |             |  |   | (21,757   | )      |  |          | (11,632 | )      |  |   |       |       
|                          |       |                        |       |           |            |              |             |             |  |   |           |        |  |          |        
|                          | Total |                        | $     | 4,003     |            |              | $           | 44,003      |  |   | $         | 21,779 |  |          | $       | 17,855 |  |   | $      | 87,133 | 
|                          |       |                        |       |           |            |              |             |             |  |   |           |        |  |          |        

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North Pointe Holdings Corporation and Subsidiaries




Schedule III


Supplementary Insurance Information


For the Year Ended December 31, 2004


|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |   |   |   |  |   |        |        | 
|------------------------- | ----- | ----------- | ----- | ------------- | ---------- | - | ------ | -------- | ------ | ------ | -------- | ------ | ------- | - | - | - |  | - | ------ | ------ | 
|(A)                       |       | (B)         |       |               | (C)        |   |        | (D)      |        |        | (E)      |        | (F)     |  
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |  
|                          |       |             |       | Future Policy |            |   |        |          | Other  |        |         
|                          |       |             |       | Benefits,     |            |   |        |          | Policy |        |         
|                          |       | Deferred    |       |               | Losses,    |   |        |          |        | Claims |          |       
|                          |       | Policy      |       |               | Claims and |   |        |          |        | and    |          |       
|                          |       | Acquisition |       |               | Loss       |   |        | Unearned |        |        | Benefits |        | Premium |  
|Segment                   |       | Costs       |       |               | Expenses   |   |        | Premiums |        |        | Payable  |        | Revenue |  
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |  
|Personal lines            |       | $           | 1,426 |               |            | $ | 23,993 |          |        | $      | 6,027    |        |         | $ |  |   |  | $ | 21,622 |       
|Commercial lines          |       |             | 8,367 |               |            |   | 72,568 |          |        |        | 36,224   |        |         |   |  |   |  |   | 55,335 |       
|Administrative operations |       |             |      |               |            |   |       |          |        |        |         |        |         |   |  |   |  |   |       |       
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |   |  
|                          | Total |             | $     | 9,793         |            |   | $      | 96,561   |        |        | $        | 42,251 |         |   | $ |  |  |   | $      | 76,957 | 
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |   |  

|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |         |        |  |   |        |        | 
|------------------------- | ----- | ---------- | ----- | --------- | ---------- | ------------ | ----------- | ----------- |  | - | --------- | ------ |  | -------- | ------- | ------ |  | - | ------ | ------ | 
|(A)                       |       | (G)        |       |           | (H)        |              |             | (I)         |  |   | (J)       |        |  | (K)      |        
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |        
|                          |       |            |       |           |            | Amortization |             |             |  |   |          
|                          |       |            |       | Benefits, |            |              | of Deferred |             |  |   |           |       
|                          |       | Net        |       |           | Claims,    |              |             | Policy      |  |   | Other     |        |  | Net      |        
|                          |       | Investment |       |           | Settlement |              |             | Acquisition |  |   | Operating |        |  | Premiums |        
|Segment                   |       | Income     |       |           | Expenses   |              |             | Costs       |  |   | Expenses  |        |  | Written  |        
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |        
|Personal lines            |       | $          |      |           |            | $            | 13,347      |             |  | $ | 5,242     |        |  | $        | 4,694   |        |  | $ | 19,099 |       
|Commercial lines          |       |            |      |           |            |              | 28,156      |             |  |   | 13,394    |        |  |          | 11,676  |        |  |   | 61,394 |       
|Administrative operations |       |            |      |           |            |              |            |             |  |   | 14,689    |        |  |          | 7,171   |        |  |   |        |       
|Corporate                 |       |            | 2,377 |           |            |              |            |             |  |   |           |        |  |          | 1,149   |        |  |   |        |       
|Eliminations              |       |            |      |           |            |              |            |             |  |   | (14,638   | )      |  |          | (10,960 | )      |  |   |        |       
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |        
|                          | Total |            | $     | 2,377     |            |              | $           | 41,503      |  |   | $         | 18,687 |  |          | $       | 13,730 |  |   | $      | 80,493 | 
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |        

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North Pointe Holdings Corporation and Subsidiaries




Schedule III


Supplementary Insurance Information


For The Year Ended December 31, 2003


|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |   |   |   |  |   |        |        | 
|------------------------- | ----- | ----------- | ----- | ------------- | ---------- | - | ------ | -------- | ------ | ------ | -------- | ------ | ------- | - | - | - |  | - | ------ | ------ | 
|(A)                       |       | (B)         |       |               | (C)        |   |        | (D)      |        |        | (E)      |        | (F)     |  
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |  
|                          |       |             |       | Future Policy |            |   |        |          | Other  |        |         
|                          |       |             |       | Benefits,     |            |   |        |          | Policy |        |         
|                          |       | Deferred    |       |               | Losses,    |   |        |          |        | Claims |          |       
|                          |       | Policy      |       |               | Claims and |   |        |          |        | and    |          |       
|                          |       | Acquisition |       |               | Loss       |   |        | Unearned |        |        | Benefits |        | Premium |  
|Segment                   |       | Costs       |       |               | Expenses   |   |        | Premiums |        |        | Payable  |        | Revenue |  
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |  
|Personal lines            |       | $           | 1,776 |               |            | $ | 26,620 |          |        | $      | 9,094    |        |         | $ |  |   |  | $ | 23,264 |       
|Commercial lines          |       |             | 5,397 |               |            |   | 49,699 |          |        |        | 29,438   |        |         |   |  |   |  |   | 45,476 |       
|Administrative operations |       |             |      |               |            |   |       |          |        |        |         |        |         |   |  |   |  |   |       |       
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |   |  
|                          | Total |             | $     | 7,173         |            |   | $      | 76,319   |        |        | $        | 38,532 |         |   | $ |  |  |   | $      | 68,740 | 
|                          |       |             |       |               |            |   |        |          |        |        |          |        |         |   |  

|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |        |        |  |   |        |        | 
|------------------------- | ----- | ---------- | ----- | --------- | ---------- | ------------ | ----------- | ----------- |  | - | --------- | ------ |  | -------- | ------ | ------ |  | - | ------ | ------ | 
|(A)                       |       | (G)        |       |           | (H)        |              |             | (I)         |  |   | (J)       |        |  | (K)      |       
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |       
|                          |       |            |       |           |            | Amortization |             |             |  |   |          
|                          |       |            |       | Benefits, |            |              | of Deferred |             |  |   |           |       
|                          |       | Net        |       |           | Claims,    |              |             | Policy      |  |   | Other     |        |  | Net      |       
|                          |       | Investment |       |           | Settlement |              |             | Acquisition |  |   | Operating |        |  | Premiums |       
|Segment                   |       | Income     |       |           | Expenses   |              |             | Costs       |  |   | Expenses  |        |  | Written  |       
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |       
|Personal lines            |       | $          |      |           |            | $            | 15,130      |             |  | $ | 5,874     |        |  | $        | 5,387  |        |  | $ | 24,294 |       
|Commercial lines          |       |            |      |           |            |              | 18,011      |             |  |   | 11,483    |        |  |          | 10,050 |        |  |   | 51,930 |       
|Administrative operations |       |            |      |           |            |              |            |             |  |   | 13,350    |        |  |          | 6,222  |        |  |   |       |       
|Corporate                 |       |            | 2,174 |           |            |              |            |             |  |   |          |        |  |          | 668    |        |  |   |       |       
|Eliminations              |       |            |      |           |            |              |            |             |  |   | (13,298   | )      |  |          | (9,168 | )      |  |   |       |       
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |       
|                          | Total |            | $     | 2,174     |            |              | $           | 33,141      |  |   | $         | 17,409 |  |          | $      | 13,159 |  |   | $      | 76,224 | 
|                          |       |            |       |           |            |              |             |             |  |   |           |        |  |          |       

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North Pointe Holdings Corporation




Schedule IV  Reinsurance


|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |   |        |        |  |  |       |    | 
|---------------------------- | ---------------------- | ---------------------- | - | -------- | --------- |  | ------- | ---------- | ------ | ---------- | ------ | --------- | ----- | ------- | - | ------ | ------ |  |  | ----- | -- | 
|                             |                        |                        |   |          |           |  |         |            |        | Percentage |       
|                             |                        |                        |   | Ceded to |           |  | Assumed |            |        |            |        | of Amount |      
|                             |                        | Gross                  |   |          | Other     |  |         | from Other |        |            | Net    |           |       | Assumed |  
|                             |                        | Amount                 |   |          | Companies |  |         | Companies  |        |            | Amount |           |       | to Net  |  
|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |  
|                             |                        | (Dollars in thousands) |  
|Year ended December 31, 2005 |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |   |        |        |  |  |      
|Premiums earned:             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |   |        |        |  |  |      
|                             | Property and liability |                        | $ | 107,904  |           |  | $       | 24,651     |        |            | $      | 1,288     |       |         | $ | 84,541 |        |  |  | 1.52  | % 
|                             | Accident and health    |                        |   | 454      |           |  |         | 259        |        |            |        |          |       |         |   | 195    |        |  |  | 0.00  | % 
|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |  
|                             |                        | Total premiums         |   | $        | 108,358   |  |         | $          | 24,910 |            |        | $         | 1,288 |         |   | $      | 84,736 |  |  |       |    | 
|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |  
|Year ended December 31, 2004 |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |   |        |        |  |  |      
|Premiums earned:             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |   |        |        |  |  |      
|                             | Property and liability |                        | $ | 89,927   |           |  | $       | 15,255     |        |            | $      | 1,648     |       |         | $ | 76,320 |        |  |  | 2.16  | % 
|                             | Accident and health    |                        |   | 1,167    |           |  |         | 530        |        |            |        |          |       |         |   | 637    |        |  |  | 0.00  | % 
|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |  
|                             |                        | Total premiums         |   | $        | 91,094    |  |         | $          | 15,785 |            |        | $         | 1,648 |         |   | $      | 76,957 |  |  |       |    | 
|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |  
|Year ended December 31, 2003 |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |   |        |        |  |  |      
|Premiums earned:             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |   |        |        |  |  |      
|                             | Property and liability |                        | $ | 78,360   |           |  | $       | 12,496     |        |            | $      | 1,940     |       |         | $ | 67,804 |        |  |  | 2.86  | % 
|                             | Accident and health    |                        |   | 1,649    |           |  |         | 712        |        |            |        | (1        | )     |         |   | 936    |        |  |  | (0.11 | )%
|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |  
|                             |                        | Total premiums         |   | $        | 80,009    |  |         | $          | 13,208 |            |        | $         | 1,939 |         |   | $      | 68,740 |  |  |       |    | 
|                             |                        |                        |   |          |           |  |         |            |        |            |        |           |       |         |  

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North Pointe Holdings Corporation and North Pointe
Companies


Schedule VI


Supplemental Information Concerning Property and Casualty
Insurance Operations


|                                 |  |                            |        |  |             |   |        |          |  |   |        | 
|-------------------------------- |  | -------------------------- | ------ |  | ----------- | - | ------ | -------- |  | - | ------ | 
|                                 |  | Losses and Loss Adjustment |        |  |            
|                                 |  | Expenses Incurred Related  |        |  | Paid Losses |  
|                                 |  | to                         |        |  | and Loss    |  
|                                 |  |                            |        |  | Adjustment  |  
|For the Years Ended December 31, |  | Current Year               |        |  | Prior Years |   |        | Expenses | 
|                                 |  |                            |        |  |             |   |        |          | 
|                                 |  | (Dollars in thousands)     |       
|2005                             |  | $                          | 49,438 |  |             | $ | (5,435 | )        |  | $ | 46,276 | 
|                                 |  |                            |        |  |             |   |        |          | 
|2004                             |  | $                          | 47,495 |  |             | $ | (5,992 | )        |  | $ | 41,196 | 
|                                 |  |                            |        |  |             |   |        |          | 
|2003                             |  | $                          | 38,569 |  |             | $ | (5,428 | )        |  | $ | 34,006 | 
|                                 |  |                            |        |  |             |   |        |          | 

S-X.


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EXHIBIT INDEX




| |          |          
| | -------- | ---------
| | 15(a)(3) | Exhibits.

|        |    |             |  |                                                                                                                                                                                                                                                                                                                                                                                              
|------- | -- | ----------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |            
|No      |    | Description
|        |    |            
|        | 3  | .1*         |  | Form of Second Amended and Restated Articles of Incorporation of
    North Pointe Holdings Corporation, incorporated by reference to
    Exhibit 3.1 to the registrants registration statement
    on Form S-1 (file no. 333-122220) filed on January 21,
    2005.                                                                                                                         
|        | 3  | .2*         |  | Form of Second Amended and Restated Bylaws of North Pointe
    Holdings Corporation, incorporated by reference to
    Exhibit 3.2 to the registrants registration statement
    on Form S-1 (file no. 333-122220) filed on January 21,
    2005.                                                                                                                                            
|        | 4  | .1          |  | Junior Subordinated Indenture between North Pointe Holdings
    Corporation and LaSalle Bank National Association, as Trustee,
    dated February 22, 2006.                                                                                                                                                                                                                                  
|        | 4  | .2          |  | Form of Floating Rate Junior Subordinated Note Due 2036.                                                                                                                                                                                                                                                                                                                                     
|        | 4  | .3          |  | Preferred Securities Certificate of NP Capital Trust I.                                                                                                                                                                                                                                                                                                                                      
|        | 4  | .4          |  | Form of Certificate Evidencing Common Securities of
    NP Capital Trust I.                                                                                                                                                                                                                                                                                                                  
|        | 10 | .1*+        |  | North Pointe Holdings Corporation Equity Incentive Plan,
    incorporated by reference to Exhibit 10.1 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                                                                                                                                                       
|        | 10 | .2*+        |  | Employment Agreement by and between North Pointe Holdings
    Corporation and James G. Petcoff, dated June 10, 2005,
    incorporated by reference to Exhibit 10.2 to the Amendment
    No. 2 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on June 15, 2005.                                                                                       
|        | 10 | .3*+        |  | North Pointe Holdings Corporation Annual Incentive Compensation
    Plan, incorporated by reference to Exhibit 10.3 to the
    Amendment No. 2 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    June 15, 2005.                                                                                                                                  
|        | 10 | .5*+        |  | Employment Agreement by and between North Pointe Holdings
    Corporation and B. Matthew Petcoff, dated June 10, 2005,
    incorporated by reference to Exhibit 10.5 to the Amendment
    No. 2 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on June 15, 2005.                                                                                     
|        | 10 | .6*         |  | Investment Advisory Agreement, dated July 6, 2004, between
    North Pointe Insurance Company and JPMorgan Investment Advisors
    Inc. (formerly Banc One Investment Advisors Corporation),
    incorporated by reference to Exhibit 10.6 to the Amendment
    No. 4 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on August 19,
    2005.         
|        | 10 | .7*         |  | Investment Advisory Agreement, dated September 13, 2004,
    between North Pointe Insurance Company and Munder Capital
    Management, incorporated by reference to Exhibit 10.7 to
    the Amendment No. 4 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    August 19, 2005.                                                                   
|        | 10 | .8*         |  | Amended and Restated Credit Agreement, dated January 26,
    2004, by and between North Pointe Holdings Corporation and
    Comerica Bank, incorporated by reference to Exhibit 10.8 to
    the registrants registration statement on Form S-1
    (file no. 333-122220) filed on January 21, 2005.                                                                                         
|        | 10 | .9*         |  | Amendment No. 1 to Amended and Restated Credit Agreement
    and Term Notes, dated March 31, 2004, by and between North
    Pointe Holdings Corporation and Comerica Bank, as agent for the
    various financial institutions, incorporated by reference to
    Exhibit 10.9 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.
|        | 10 | .10*        |  | Amendment No. 2 to Amended and Restated Credit Agreement,
    dated June 30, 2004, by and between North Pointe Holdings
    Corporation and Comerica Bank, incorporated by reference to
    Exhibit 10.10 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                    
|        | 10 | .11*        |  | Amended and Restated Pledge Agreement, dated January 26,
    2004, between North Pointe Financial Services, Inc. and Comerica
    Bank, as agent for the various financial institutions,
    incorporated by reference to Exhibit 10.11 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                      

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|        |    |             |  |                                                                                                                                                                                                                                                                                                                                                    
|------- | -- | ----------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |            
|No      |    | Description
|        |    |            
|        | 10 | .12*        |  | Amended and Restated Pledge Agreement, dated January 26,
    2004, between North Pointe Holdings Corporation and Comerica
    Bank, as agent for the various financial institutions,
    incorporated by reference to Exhibit 10.12 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.
|        | 10 | .13*        |  | Amended and Restated Security Agreement, dated January 26,
    2004, between N.P. Premium Finance Co., Inc. and Comerica Bank,
    as agent for the various financial institutions, incorporated by
    reference to Exhibit 10.13 to the registrants
    registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005. 
|        | 10 | .14         |  | Line of Credit Loan Agreement, dated March 4, 2005, by and
    between N.P. Premium Finance Company and North Pointe Financial
    Services, Inc.                                                                                                                                                                                                  
|        | 10 | .15         |  | Line of Credit Note in the amount of $1,500,000, dated
    March 4, 2005, by N.P. Premium Finance Company in favor of
    North Pointe Financial Services, Inc.                                                                                                                                                                                    
|        | 10 | .16*        |  | Stock Redemption Agreement, dated April 8, 2004, by and
    between North Pointe Holdings Corporation and Strength Capital
    Partners, L.P., incorporated by reference to Exhibit 10.16
    to the registrants registration statement on Form S-1
    (file no. 333-122220) filed on January 21, 2005.                                          
|        | 10 | .17         |  | Consulting Agreement, dated March 5, 2003, by and between
    North Pointe Insurance Company and LVM Company.                                                                                                                                                                                                                                      
|        | 10 | .18         |  | Consulting Agreement dated September 30, 2005, by and
    between North Pointe Holdings Corporation and Joon Moon.                                                                                                                                                                                                                                 
|        | 10 | .19*        |  | Insurance Company and C.S.A.C. Agency, incorporated by reference
    to Exhibit 10.19 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                                                                                              
|        | 10 | .20*        |  | Agency Agreement, dated June 1, 2004, by and between North
    Pointe Insurance Company and Amelia Underwriters, Inc.,
    incorporated by reference to Exhibit 10.20 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                                              
|        | 10 | .21*        |  | General Agency Agreement, dated August 1, 1996, by and
    between North Pointe Insurance Company and MS General Agency,
    Inc., incorporated by reference to Exhibit 10.21 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                                      
|        | 10 | .22*        |  | Agency Agreement, dated March 24, 2003, by and between
    North Pointe Insurance Company and Insurance Brokers of
    Indiana., incorporated by reference to Exhibit 10.22 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                                        
|        | 10 | .23*        |  | Reinsurance and Indemnity Agreement, effective July 1,
    2003, by and between North Pointe Insurance Company and
    Universal Fire & Casualty, incorporated by reference to
    Exhibit 10.23 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                   
|        | 10 | .24*        |  | Quota Share Reinsurance Agreement, dated December 1, 2003,
    by and between North Pointe Financial Services, Inc. and State
    National Insurance Company, incorporated by reference to
    Exhibit 10.24 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                       
|        | 10 | .25*        |  | General Agency Agreement, dated December 1, 2003, by and
    between North Pointe Financial Services, Inc. and State National
    Insurance Company, incorporated by reference to
    Exhibit 10.25 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                
|        | 10 | .26*        |  | Agreement, dated December 3, 2002, by and between North
    Pointe Insurance Company and the Associated Food Dealers of
    Michigan, incorporated by reference to Exhibit 10.26 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                                   
|        | 10 | .27         |  | Trust Agreement of NP Capital Trust I between North Pointe
    Holdings Corporation and Christiana Bank and Trust Company as
    Delaware Trustee, dated as of February 21, 2006.                                                                                                                                                                  
|        | 10 | .28         |  | Amended and restated Trust Agreement among North Pointe Holdings
    Corporation, as Depositor, LaSalle Bank National Association as
    Property Trustee, Christiana Bank and Trust Company as Delaware
    Trustee dated as of February 22, 2006.                                                                                                
|        | 10 | .29         |  | Guarantee Agreement between North Pointe Holdings Corporation, a
    Guarantor, and LaSalle Bank National Association, as Guarantee
    Trustee, dated February 22, 2006.                                                                                                                                                                          

110



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##### Table of Contents



|        |    |             |  |                                                                                                                                                                                                                                                                                                                                                                                                
|------- | -- | ----------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |            
|No      |    | Description
|        |    |            
|        | 10 | .30         |  | Purchase Agreement among North Pointe Holdings Corporation, NP
    Capital Trust I and Merrill Lynch International dated as of
    February 22, 2006.                                                                                                                                                                                                                                          
|        | 10 | .31         |  | Junior Subordinated Note Purchase Agreement between North
    Pointed Holdings Corporation and NP capital Trust I, dated as of
    February 22, 2006.                                                                                                                                                                                                                                          
|        | 10 | .32         |  | Waiver and Consent Letter Dated February 21, 2005, to the
    Amended and Restated Credit Agreement, dated January 26,
    2004, by and between North Pointe Holdings Corporation and
    Comerica Bank, as agent for the various financial institutions.                                                                                                                                      
|        | 10 | .33         |  | Waiver Letter, dated February 28, 2005, to the Amended and
    Restated Credit Agreement, dated January 26, 2004, by and
    between North Pointe Holdings Corporation and Comerica Bank, as
    agent for the various financial institutions.                                                                                                                                                 
|        | 10 | .34*        |  | Asset Purchase Agreement, dated October 15, 2004, by and
    between North Pointe Insurance Company and THI Holdings
    (Delaware), Inc., incorporated by reference to
    Exhibit 10.33 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                                      
|        | 10 | .35*        |  | Agreement, dated November 10, 2004, between the Florida
    Department of Financial Services, as Receiver for American
    Superior Insurance Company and North Pointe Casualty Insurance
    Company, incorporated by reference to Exhibit 10.34 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                              
|        | 10 | .36*        |  | Consent Order of Florida Office of Insurance Regulation, dated
    November 16, 2004, incorporated by reference to
    Exhibit 10.35 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                                                                                           
|        | 10 | .37*        |  | Services Agreement, dated November 5, 2004, between
    Business Risk Technology, Inc. and North Pointe Casualty
    Insurance Company, incorporated by reference to
    Exhibit 10.36 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                                         
|        | 10 | .38         |  | Assumption of Mortgage Agreement for the Purchase Agreement
    regarding 28819 Franklin Road, Southfield, Michigan, 48034,
    dated August 18, 2005.                                                                                                                                                                                                                                         
|        | 10 | .39*        |  | Purchase Agreement, dated February 11, 2005, by and among
    North Pointe Financial Services, Inc., as Buyer, and S. James
    Clarkson and Petcoff Financial Services, L.L.C., as Sellers,
    incorporated by reference to Exhibit 10.38 to the Amendment
    No. 1 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on March 29, 2005.               
|        | 10 | .40*        |  | Amendment No. 3 to Amended and Restated Credit Agreement,
    dated March   , 2005, by and among certain
    lenders, Comerica Bank, as agent for the lenders, and North
    Pointe Holdings Corporation, incorporated by reference to
    Exhibit 10.39 to the Amendment No. 4 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on August 19, 2005. 
|        | 10 | .41*        |  | Amendment No. 4 to Amended and Restated Credit Agreement,
    dated June 2005, by and among certain lenders, Comerica Bank, as
    agent for the lenders, and North Pointe Holdings Corporation,
    incorporated by reference to Exhibit 10.40 to the Amendment
    No. 4 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on
    August 19, 2005.      
|        | 10 | .42*        |  | Second Amended and Restated Pledge Agreement, dated March 2005,
    by and between North Pointe Financial Services, Inc. and
    Comerica Bank, as agent for the various financial institutions,
    incorporated by reference to Exhibit 10.41 to the Amendment
    No. 4 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on
    August 19, 2005.      
|        | 10 | .43*        |  | Investment Advisory Agreement, dated June 16, 2004, between
    North Pointe Casualty Insurance Company and JPMorgan Investment
    Advisors Inc. (formerly Banc One Investment Advisors
    Corporation), incorporated by reference to Exhibit 10.42 to
    the Amendment No. 4 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    August 19, 2005.
|        | 10 | .44*        |  | Investment Management Agreement, dated June 10, 2005,
    between JPMorgan Investment Advisors Inc. and Home Pointe
    Insurance Company, incorporated by reference to
    Exhibit 10.43 to the Amendment No. 4 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on August 19, 2005.                                                                
|        | 10 | .45*        |  | Form of stock option award, incorporated by reference to
    Exhibit 10.1 to the registrants quarterly report on
    Form 10-Q (file no. 000-51530) filed on November 14,
    2005.                                                                                                                                                                                                           
|        | 10 | .46*        |  | Form of restricted stock option award, incorporated by reference
    to Exhibit 10.2 to the registrants quarterly report
    on Form 10-Q (file no. 000-51530) filed on
    November 14, 2005.                                                                                                                                                                                                

111



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##### Table of Contents



|        |    |             |  |                                                                                                                                                                                                              
|------- | -- | ----------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |            
|No      |    | Description
|        |    |            
|        | 10 | .47         |  | Amendment No. 5 to Amended and Restated Credit Agreement,
    dated September 22, 2005, by and among certain lenders,
    Comerica Bank, as agent for the lenders, and North Pointe
    Holdings Corporation.
|        | 21 | .1          |  | Subsidiaries of North Pointe Holdings Corporation.                                                                                                                                                           
|        | 31 | .1          |  | Certification of Chief Executive Officer pursuant to
    Rule 13a-14(a) under the Securities Exchange Act of 1934.                                                                                           
|        | 31 | .2          |  | Certification of Chief Financial Officer pursuant to
    Rule 13a-14(a) under the Securities Exchange Act of 1934.                                                                                           
|        | 32 | .1          |  | Certification of Chief Executive Officer and Chief Financial
    Officer pursuant to 18 U.S.C. Section 1350 and
    Rule 13a-14(b) under the Securities Exchange Act of 1934.                                






|  |                  
|- | -----------------
|* | Previously filed.



|  |                                  
|- | ---------------------------------
| | Compensatory plan or arrangement.

112



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##### Table of Contents



SIGNATURES






| |                                  
| | ---------------------------------
| | NORTH POINTE HOLDINGS CORPORATION



| |     |                     
| | --- | --------------------
| | By: | /s/ James G. Petcoff

| |                                   
| | ----------------------------------
| |                                   
| | James G. Petcoff                  
| | Chief Executive Officer, President
| | and Chairman of the Board         





|                                                         |  |                                                                        |  |                |  | 
|-------------------------------------------------------- |  | ---------------------------------------------------------------------- |  | -------------- |  | 
|Signature                                                |  | Title                                                                  |  | Date          
|                                                         |  |                                                                        |  |               
|                                                        
|/s/ James G. PetcoffJames G. Petcoff                     |  | Chief Executive Officer, President & Chairman of the
    Board         |  | March 21, 2006
|                                                        
|/s/ B. Matthew PetcoffB. Matthew Petcoff                 |  | Chief Operating Officer, Executive Vice President &
    Director       |  | March 21, 2006
|                                                        
|/s/ John H. BerryJohn H. Berry                           |  | Chief Financial Officer & Treasurer (Principal
    Accounting Officer) |  | March 21, 2006
|                                                        
|/s/ Richard J. LindbergRichard J. Lindberg               |  | Director                                                               |  | March 21, 2006
|                                                        
|/s/ Joon S. MoonJoon S. Moon                             |  | Director                                                               |  | March 21, 2006
|                                                        
|/s/ Jorge J. MoralesJorge J. Morales                     |  | Director                                                               |  | March 21, 2006
|                                                        
|/s/ R. Jamison
    Williams, Jr.R. Jamison Williams, Jr. |  | Director                                                               |  | March 21, 2006

113



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##### Table of Contents



EXHIBIT INDEX


|           |    |             |  |                                                                                                                                                                                                                                                                                                                                                                                              
|---------- | -- | ----------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No |    | Description
|           |    |            
|           | 3  | .1*         |  | Form of Second Amended and Restated Articles of Incorporation of
    North Pointe Holdings Corporation, incorporated by reference to
    Exhibit 3.1 to the registrants registration statement
    on Form S-1 (file no. 333-122220) filed on January 21,
    2005.                                                                                                                         
|           | 3  | .2*         |  | Form of Second Amended and Restated Bylaws of North Pointe
    Holdings Corporation, incorporated by reference to
    Exhibit 3.2 to the registrants registration statement
    on Form S-1 (file no. 333-122220) filed on January 21,
    2005.                                                                                                                                            
|           | 4  | .1          |  | Junior Subordinated Indenture between North Pointe Holdings
    Corporation and LaSalle Bank National Association, as Trustee,
    dated February 22, 2006.                                                                                                                                                                                                                                  
|           | 4  | .2          |  | Form of Floating Rate Junior Subordinated Note Due 2036.                                                                                                                                                                                                                                                                                                                                     
|           | 4  | .3          |  | Preferred Securities Certificate of NP Capital Trust I.                                                                                                                                                                                                                                                                                                                                      
|           | 4  | .4          |  | Form of Certificate Evidencing Common Securities of
    NP Capital Trust I.                                                                                                                                                                                                                                                                                                                  
|           | 10 | .1*+        |  | North Pointe Holdings Corporation Equity Incentive Plan,
    incorporated by reference to Exhibit 10.1 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                                                                                                                                                       
|           | 10 | .2*+        |  | Employment Agreement by and between North Pointe Holdings
    Corporation and James G. Petcoff, dated June 10, 2005,
    incorporated by reference to Exhibit 10.2 to the Amendment
    No. 2 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on June 15, 2005.                                                                                       
|           | 10 | .3*+        |  | North Pointe Holdings Corporation Annual Incentive Compensation
    Plan, incorporated by reference to Exhibit 10.3 to the
    Amendment No. 2 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    June 15, 2005.                                                                                                                                  
|           | 10 | .5*+        |  | Employment Agreement by and between North Pointe Holdings
    Corporation and B. Matthew Petcoff, dated June 10, 2005,
    incorporated by reference to Exhibit 10.5 to the Amendment
    No. 2 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on June 15, 2005.                                                                                     
|           | 10 | .6*         |  | Investment Advisory Agreement, dated July 6, 2004, between
    North Pointe Insurance Company and JPMorgan Investment Advisors
    Inc. (formerly Banc One Investment Advisors Corporation),
    incorporated by reference to Exhibit 10.6 to the Amendment
    No. 4 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on August 19,
    2005.         
|           | 10 | .7*         |  | Investment Advisory Agreement, dated September 13, 2004,
    between North Pointe Insurance Company and Munder Capital
    Management, incorporated by reference to Exhibit 10.7 to
    the Amendment No. 4 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    August 19, 2005.                                                                   
|           | 10 | .8*         |  | Amended and Restated Credit Agreement, dated January 26,
    2004, by and between North Pointe Holdings Corporation and
    Comerica Bank, incorporated by reference to Exhibit 10.8 to
    the registrants registration statement on Form S-1
    (file no. 333-122220) filed on January 21, 2005.                                                                                         
|           | 10 | .9*         |  | Amendment No. 1 to Amended and Restated Credit Agreement
    and Term Notes, dated March 31, 2004, by and between North
    Pointe Holdings Corporation and Comerica Bank, as agent for the
    various financial institutions, incorporated by reference to
    Exhibit 10.9 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.
|           | 10 | .10*        |  | Amendment No. 2 to Amended and Restated Credit Agreement,
    dated June 30, 2004, by and between North Pointe Holdings
    Corporation and Comerica Bank, incorporated by reference to
    Exhibit 10.10 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                    
|           | 10 | .11*        |  | Amended and Restated Pledge Agreement, dated January 26,
    2004, between North Pointe Financial Services, Inc. and Comerica
    Bank, as agent for the various financial institutions,
    incorporated by reference to Exhibit 10.11 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                      
|           | 10 | .12*        |  | Amended and Restated Pledge Agreement, dated January 26,
    2004, between North Pointe Holdings Corporation and Comerica
    Bank, as agent for the various financial institutions,
    incorporated by reference to Exhibit 10.12 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                          
|           | 10 | .13*        |  | Amended and Restated Security Agreement, dated January 26,
    2004, between N.P. Premium Finance Co., Inc. and Comerica Bank,
    as agent for the various financial institutions, incorporated by
    reference to Exhibit 10.13 to the registrants
    registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                           

114



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##### Table of Contents



|           |    |             |  |                                                                                                                                                                                                                                                                                                                             
|---------- | -- | ----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No |    | Description
|           |    |            
|           | 10 | .14         |  | Line of Credit Loan Agreement, dated March 4, 2005, by and
    between N.P. Premium Finance Company and North Pointe Financial
    Services, Inc.                                                                                                                                                                           
|           | 10 | .15         |  | Line of Credit Note in the amount of $1,500,000, dated
    March 4, 2005, by N.P. Premium Finance Company in favor of
    North Pointe Financial Services, Inc.                                                                                                                                                             
|           | 10 | .16*        |  | Stock Redemption Agreement, dated April 8, 2004, by and
    between North Pointe Holdings Corporation and Strength Capital
    Partners, L.P., incorporated by reference to Exhibit 10.16
    to the registrants registration statement on Form S-1
    (file no. 333-122220) filed on January 21, 2005.                   
|           | 10 | .17         |  | Consulting Agreement, dated March 5, 2003, by and between
    North Pointe Insurance Company and LVM Company.                                                                                                                                                                                                               
|           | 10 | .18         |  | Consulting Agreement dated September 30, 2005, by and
    between North Pointe Holdings Corporation and Joon Moon.                                                                                                                                                                                                          
|           | 10 | .19*        |  | Insurance Company and C.S.A.C. Agency, incorporated by reference
    to Exhibit 10.19 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                                                                       
|           | 10 | .20*        |  | Agency Agreement, dated June 1, 2004, by and between North
    Pointe Insurance Company and Amelia Underwriters, Inc.,
    incorporated by reference to Exhibit 10.20 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                       
|           | 10 | .21*        |  | General Agency Agreement, dated August 1, 1996, by and
    between North Pointe Insurance Company and MS General Agency,
    Inc., incorporated by reference to Exhibit 10.21 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                               
|           | 10 | .22*        |  | Agency Agreement, dated March 24, 2003, by and between
    North Pointe Insurance Company and Insurance Brokers of
    Indiana., incorporated by reference to Exhibit 10.22 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                                 
|           | 10 | .23*        |  | Reinsurance and Indemnity Agreement, effective July 1,
    2003, by and between North Pointe Insurance Company and
    Universal Fire & Casualty, incorporated by reference to
    Exhibit 10.23 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.            
|           | 10 | .24*        |  | Quota Share Reinsurance Agreement, dated December 1, 2003,
    by and between North Pointe Financial Services, Inc. and State
    National Insurance Company, incorporated by reference to
    Exhibit 10.24 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.
|           | 10 | .25*        |  | General Agency Agreement, dated December 1, 2003, by and
    between North Pointe Financial Services, Inc. and State National
    Insurance Company, incorporated by reference to
    Exhibit 10.25 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.         
|           | 10 | .26*        |  | Agreement, dated December 3, 2002, by and between North
    Pointe Insurance Company and the Associated Food Dealers of
    Michigan, incorporated by reference to Exhibit 10.26 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                            
|           | 10 | .27         |  | Trust Agreement of NP Capital Trust I between North Pointe
    Holdings Corporation and Christiana Bank and Trust Company as
    Delaware Trustee, dated as of February 21, 2006.                                                                                                                                           
|           | 10 | .28         |  | Amended and restated Trust Agreement among North Pointe Holdings
    Corporation, as Depositor, LaSalle Bank National Association as
    Property Trustee, Christiana Bank and Trust Company as Delaware
    Trustee dated as of February 22, 2006.                                                                         
|           | 10 | .29         |  | Guarantee Agreement between North Pointe Holdings Corporation, a
    Guarantor, and LaSalle Bank National Association, as Guarantee
    Trustee, dated February 22, 2006.                                                                                                                                                   
|           | 10 | .30         |  | Purchase Agreement among North Pointe Holdings Corporation, NP
    Capital Trust I and Merrill Lynch International dated as of
    February 22, 2006.                                                                                                                                                                       
|           | 10 | .31         |  | Junior Subordinated Note Purchase Agreement between North
    Pointed Holdings Corporation and NP capital Trust I, dated as of
    February 22, 2006.                                                                                                                                                                       
|           | 10 | .32         |  | Waiver and Consent Letter Dated February 21, 2005, to the
    Amended and Restated Credit Agreement, dated January 26,
    2004, by and between North Pointe Holdings Corporation and
    Comerica Bank, as agent for the various financial institutions.                                                                   
|           | 10 | .33         |  | Waiver Letter, dated February 28, 2005, to the Amended and
    Restated Credit Agreement, dated January 26, 2004, by and
    between North Pointe Holdings Corporation and Comerica Bank, as
    agent for the various financial institutions.                                                                              
|           | 10 | .34*        |  | Asset Purchase Agreement, dated October 15, 2004, by and
    between North Pointe Insurance Company and THI Holdings
    (Delaware), Inc., incorporated by reference to
    Exhibit 10.33 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                   

115



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##### Table of Contents



|           |    |             |  |                                                                                                                                                                                                                                                                                                                                                                                                
|---------- | -- | ----------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No |    | Description
|           |    |            
|           | 10 | .35*        |  | Agreement, dated November 10, 2004, between the Florida
    Department of Financial Services, as Receiver for American
    Superior Insurance Company and North Pointe Casualty Insurance
    Company, incorporated by reference to Exhibit 10.34 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on January 21, 2005.                              
|           | 10 | .36*        |  | Consent Order of Florida Office of Insurance Regulation, dated
    November 16, 2004, incorporated by reference to
    Exhibit 10.35 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                                                                                           
|           | 10 | .37*        |  | Services Agreement, dated November 5, 2004, between
    Business Risk Technology, Inc. and North Pointe Casualty
    Insurance Company, incorporated by reference to
    Exhibit 10.36 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    January 21, 2005.                                                                                         
|           | 10 | .38         |  | Assumption of Mortgage Agreement for the Purchase Agreement
    regarding 28819 Franklin Road, Southfield, Michigan, 48034,
    dated August 18, 2005.                                                                                                                                                                                                                                         
|           | 10 | .39*        |  | Purchase Agreement, dated February 11, 2005, by and among
    North Pointe Financial Services, Inc., as Buyer, and S. James
    Clarkson and Petcoff Financial Services, L.L.C., as Sellers,
    incorporated by reference to Exhibit 10.38 to the Amendment
    No. 1 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on March 29, 2005.               
|           | 10 | .40*        |  | Amendment No. 3 to Amended and Restated Credit Agreement,
    dated March   , 2005, by and among certain
    lenders, Comerica Bank, as agent for the lenders, and North
    Pointe Holdings Corporation, incorporated by reference to
    Exhibit 10.39 to the Amendment No. 4 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on August 19, 2005. 
|           | 10 | .41*        |  | Amendment No. 4 to Amended and Restated Credit Agreement,
    dated June 2005, by and among certain lenders, Comerica Bank, as
    agent for the lenders, and North Pointe Holdings Corporation,
    incorporated by reference to Exhibit 10.40 to the Amendment
    No. 4 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on
    August 19, 2005.      
|           | 10 | .42*        |  | Second Amended and Restated Pledge Agreement, dated March 2005,
    by and between North Pointe Financial Services, Inc. and
    Comerica Bank, as agent for the various financial institutions,
    incorporated by reference to Exhibit 10.41 to the Amendment
    No. 4 to the registrants registration statement on
    Form S-1 (file no. 333-122220) filed on
    August 19, 2005.      
|           | 10 | .43*        |  | Investment Advisory Agreement, dated June 16, 2004, between
    North Pointe Casualty Insurance Company and JPMorgan Investment
    Advisors Inc. (formerly Banc One Investment Advisors
    Corporation), incorporated by reference to Exhibit 10.42 to
    the Amendment No. 4 to the registrants registration
    statement on Form S-1 (file no. 333-122220) filed on
    August 19, 2005.
|           | 10 | .44*        |  | Investment Management Agreement, dated June 10, 2005,
    between JPMorgan Investment Advisors Inc. and Home Pointe
    Insurance Company, incorporated by reference to
    Exhibit 10.43 to the Amendment No. 4 to the
    registrants registration statement on Form S-1 (file
    no. 333-122220) filed on August 19, 2005.                                                                
|           | 10 | .45*        |  | Form of stock option award, incorporated by reference to
    Exhibit 10.1 to the registrants quarterly report on
    Form 10-Q (file no. 000-51530) filed on November 14,
    2005.                                                                                                                                                                                                           
|           | 10 | .46*        |  | Form of restricted stock option award, incorporated by reference
    to Exhibit 10.2 to the registrants quarterly report
    on Form 10-Q (file no. 000-51530) filed on
    November 14, 2005.                                                                                                                                                                                                
|           | 10 | .47         |  | Amendment No. 5 to Amended and Restated Credit Agreement,
    dated September 22, 2005, by and among certain lenders,
    Comerica Bank, as agent for the lenders, and North Pointe
    Holdings Corporation.                                                                                                                                                                                  
|           | 21 | .1          |  | Subsidiaries of North Pointe Holdings Corporation.                                                                                                                                                                                                                                                                                                                                             
|           | 31 | .1          |  | Certification of Chief Executive Officer pursuant to
    Rule 13a-14(a) under the Securities Exchange Act of 1934.                                                                                                                                                                                                                                                                             
|           | 31 | .2          |  | Certification of Chief Financial Officer pursuant to
    Rule 13a-14(a) under the Securities Exchange Act of 1934.                                                                                                                                                                                                                                                                             
|           | 32 | .1          |  | Certification of Chief Executive Officer and Chief Financial
    Officer pursuant to 18 U.S.C. Section 1350 and
    Rule 13a-14(b) under the Securities Exchange Act of 1934.                                                                                                                                                                                                                  






|  |                  
|- | -----------------
|* | Previously filed.



|  |                                  
|- | ---------------------------------
| | Compensatory plan or arrangement.

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