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                                                                     Exhibit 4.2


                        AMERINST INSURANCE GROUP, INC.
                              (The "Corporation")

                    STATEMENT OF STOCK OWNERSHIP POLICY/1/
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General Policy
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1.   The insurance capacity of the Corporation's subsidiary should be utilized
     solely for the benefit of accounting firms which are stockholders of the
     Corporation in the event that the availability of accountants' professional
     liability insurance becomes limited or the market for such insurance is
     otherwise adversely affected;

2.   A reasonable relationship should be maintained between the investment that
     an accounting firm has in the Corporation and the amount of such firm's
     risks that the Corporation's subsidiary is insuring or reinsuring; and

3.   A preference should be established for accounting firms that invest
     initially in the Corporation over firms, if any, which may be allowed to
     invest subsequently.

Guidelines
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1.   Eligible Firms. "Eligible Firms" shall be those accounting firms (including
     sole proprietorships) which either (i) are currently insured under the
     AICPA Professional Liability Insurance Plan (the "AICPA Plan") or (ii) have
     a staff of 250 or fewer CPAs and at least one equity owner (proprietor,
     partner or stockholder) who is a member of either the American Institute of
     Certified Public Accountants or a state CPA society.

2.   Offerees. The shares of common stock of the Corporation to be offered in
     the Corporation's initial offering (the "Shares") shall be offered
     exclusively to Eligible Firms.

3.   Founding Firms. Eligible Firms, including Eligible Firms which are not
     currently insured under the AICPA Plan, that subscribe for Shares on or
     prior to the termination date of the offering (the "Termination Date"),
     will be designated as "Founding Firms" which status will entitle such firms
     to lower minimum initial investment requirements and lower additional
     investment requirements than Eligible Firms which make their initial
     investment in future offerings, if any.

4.   Minimum Initial Investment. All firms subscribing for Shares in the initial
     offering of the Shares must make a minimum initial investment as set forth
     below. The minimum initial investment requirement, and thus the minimum
     number of Shares that an Eligible Firm

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/1/  As amended September 9, 1996.
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     must purchase to become a Founding Firm, depends upon whether such firm is
     currently insured under the AICPA Plan.

          Firms Insured Under the AICPA Plan. Subscribers that are insured
          during 1987 under the AICPA Plan must purchase at least that number of
          Shares equal in value to the lesser of (i) 50% of such subscriber's
          1987 premiums under the AICPA Plan with respect to the first $1
          million of coverage or (ii) the greater of $500 or 1% of such
          subscriber's revenues for the subscriber's most recently completed
          twelve-month fiscal year.

          Firms Not Insured. Subscribers that are not insured during 1987 under
          the AICPA Plan must purchase at least that number of Shares equal in
          value to the greater of $500 or 1% of such subscriber's revenues for
          the subscriber's most recently completed twelve-month fiscal year.

     "Revenues" is defined as total gross cash revenues (per income tax return),
     not including the direct recovery of expenses, derived from the firm's
     professional accounting services for the last twelve-month fiscal period.

5.   Minimum Investment Applicable After the Termination Date. In any offering
     of shares of the Corporation's common stock after the Termination Date, the
     minimum initial investment requirement will be not less than (i) 75% of a
     firm's premiums under the AICPA Plan, if insured under the AICPA Plan or
     (ii) 1.5% of the firm's revenues for its most recently completed twelve-
     month fiscal year, if not insured under the AICPA Plan.

6.   Additional Investment Requirement. There is no current requirement to make
     additional investments in the Corporation. In the event that the
     Corporation determines that the insurance capacity of its subsidiary will
     be available only to stockholders of the Corporation, in order to benefit
     from such capacity, a stockholder must have a sufficient investment in the
     Corporation to be deemed a "qualified" stockholder. A firm's "investment"
     is defined to be equal to the greater of (i) the purchase price originally
     paid to the Corporation for the shares of the Corporation's common stock
     held by the firm (including shares acquired from other firms) or (ii) the
     book value of the firm's shares. If the required investment level is not
     met, a firm will be required to purchase additional shares, either directly
     from the Corporation or from other stockholders, in order to have the
     insurance capacity of the Corporation's subsidiary utilized for such
     firms's benefit. The failure to make additional investments when required
     will result in the loss of a firm's "qualified" status and a firm's
     "Founding Firm" status, if applicable. Any offering by the Corporation of
     its shares of common stock in connection with this additional investment
     requirement shall be made in accordance with the Securities Act of 1933 and
     any applicable "Blue Sky" laws.

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          Founding Firms. In order for a Founding Firm to be considered a
          "qualified" stockholder at any given point in time, such firm would be
          required to have an investment in the Corporation equal to (i) if
          insured under the AICPA Plan, at least 30% of such firm's insurance
          premiums for the then current year or (ii) if not insured under the
          AICPA Plan, 0.6% of such firm's revenues for its most recently
          completed twelve-month fiscal year. If a Founding Firm's investment
          were less than the 30% or 0.6% levels, such firm would need to raise
          its investment to a 50% or 1.0% level, respectively, to remain
          qualified.

          Non-Founding Firms. In order for a Non-Founding Firm to be considered
          a "qualified" stockholder at any given point in time, such firm would
          be required to have an investment in the Company equal to (i) if
          insured under the Plan, at least 50% of such firm's insurance premiums
          for the current year or (ii) if not insured under the Plan, 1.0% of
          such firm's revenues for its most recently completed twelve-month
          fiscal year. If a Non-Founding Firm's investment were less than the
          50% or 1.0% levels, such firm would need to raise its investment to a
          75% or 1.5% level, respectively, to remain qualified.

7.   Share Transfers. Upon request of a stockholder, the Board will consent to
     transfers of Shares among Eligible Firms absent unusual circumstances. Upon
     receipt by the Board of written evidence satisfactory to the Board that a
     stockholder has been liquidated or dissolved, the Board will consent to a
     transfer of Shares to such stockholder's partners or stockholders if the
     stockholder establishes, to the satisfaction of the Board, that it
     attempted diligently and in good faith to transfer the Shares to an
     Eligible Firm and was unable to do so. Transfers by an individual
     stockholder to a living trust, testamentary trust or other trust
     established for the benefit of the stockholder's heirs, legatees or
     devisees may be approved by the Board.

8.   Share Repurchases. Upon request of a stockholder, the Board will approve
     the repurchase of Shares from a firm, absent unusual circumstances and
     subject to the adequacy of a capital and surplus for the Corporation and
     its subsidiary, in the event such firm ceases to practice due to the death,
     disability or retirement of its owners. All such repurchases will be
     effected at a per share price equal to 75% of the book value per Share as
     reflected in the Corporation's audited year end balance sheet for the
     preceding fiscal year. The repurchase price may be paid with cash or notes
     or a combination thereof.

9.   Director Purchases. Notwithstanding any of the above, directors shall be
     eligible to buy stock from any eligible firm. There shall be no minimum
     purchase requirement. The purchase price of the stock shall be negotiated
     between buyer and seller, and not determined by formula. Upon termination
     of service as a member of the Board, the Company has the option to
     repurchase this stock at a per share price equal to 75% of the book value
     per share as reflected in the Corporation's audited year end balance sheet
     for the preceding fiscal year. The repurchase price may be paid with cash
     or notes or a combination thereof.

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     All interpretations of the foregoing policies and guidelines shall be made
     by the Board of Directors of the Corporation and shall be conclusive. The
     foregoing general policies may be amended at any time by an amendment to
     the Bylaws of the Corporation (including amendment by the Board of
     Directors of the Corporation without approval of the Corporation's
     stockholders). The foregoing guidelines may be amended at any time by a
     resolution of the Board of Directors of the Corporation without approval of
     the Corporation's stockholders.









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