<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    FORM 10-Q



                 [X] Quarterly Report Pursuant to Section 13 or
                  15(d) of the Securities Exchange Act of 1934


                  For the Quarterly Period Ended March 31, 2000


                         COMMISSION FILE NUMBER 0-22280

                     PHILADELPHIA CONSOLIDATED HOLDING CORP.
             (Exact name of registrant as specified in its charter)



      PENNSYLVANIA                                        23-2202671
(State of Incorporation)                      (IRS Employer Identification No.)

                            ONE BALA PLAZA, SUITE 100
                         BALA CYNWYD, PENNSYLVANIA 19004
                                 (610) 617-7900
                   -------------------------------------------
                        (Address, including zip code and
                    telephone number, including area code, of
                    registrant's principal executive offices)





Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                        YES /x/  NO / /

Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of May 8, 2000.

Preferred Stock, $.01 par value, no shares outstanding
Common Stock, no par value, 12,116,666 shares outstanding
<PAGE>   2
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES
                                      INDEX

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000


<TABLE>
<CAPTION>
Part I - Financial Information
<S>                                                                                            <C>
         Consolidated Balance Sheets - March 31, 2000 and
           December 31, 1999                                                                     3


         Consolidated Statements of Operations and Comprehensive
           Income - For the three months ended March 31, 2000 and 1999                           4


         Consolidated Statements of Changes in Shareholders' Equity - For the
           three months ended March 31, 2000 and year ended
           December 31, 1999                                                                     5


         Consolidated Statements of Cash Flows - For the three
           months ended March 31, 2000 and 1999                                                  6


         Notes to Consolidated Financial Statements                                              7


         Management's Discussion and Analysis of Results of Operations and
           Financial Condition                                                                 8-11



Part II - Other Information                                                                     12


Signatures                                                                                      13



Exhibits                                                                                        14
</TABLE>

                                       2
<PAGE>   3
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                        (IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                                                             As of
                                                                  March 31,          December 31,
                                                                    2000                 1999
                                                                    ----                 ----
                                                                 (Unaudited)
<S>                                                               <C>                 <C>
                                ASSETS
INVESTMENTS:
  FIXED MATURITIES AVAILABLE FOR SALE AT MARKET
     (AMORTIZED COST $340,633 AND $331,774) ............          $ 330,042           $ 321,018
  EQUITY SECURITIES AT MARKET (COST $46,969 AND $41,231)             82,331              72,768
                                                                  ---------           ---------
       TOTAL INVESTMENTS ...............................            412,373             393,786

CASH AND CASH EQUIVALENTS ..............................             25,428              26,230
ACCRUED INVESTMENT INCOME ..............................              4,616               5,027
PREMIUMS RECEIVABLE ....................................             46,904              49,176
PREPAID REINSURANCE PREMIUMS AND
     REINSURANCE RECEIVABLES ...........................             59,773              54,920
DEFERRED ACQUISITION COSTS .............................             27,949              26,054
PROPERTY AND EQUIPMENT .................................              9,639               9,277
GOODWILL LESS ACCUMULATED AMORTIZATION
     OF $2,992 AND $2,620 ..............................             28,429              28,801
OTHER ASSETS ...........................................              7,133               5,780
                                                                  ---------           ---------
       TOTAL ASSETS ....................................          $ 622,244           $ 599,051
                                                                  =========           =========

                 LIABILITIES AND SHAREHOLDERS' EQUITY
POLICY LIABILITIES AND ACCRUALS:
  UNPAID LOSS AND LOSS ADJUSTMENT EXPENSES .............          $ 198,409           $ 188,063
  UNEARNED PREMIUMS ....................................            118,297             111,606
                                                                  ---------           ---------
       TOTAL POLICY LIABILITIES AND ACCRUALS ...........            316,706             299,669
PREMIUMS PAYABLE .......................................             23,418              22,223
OTHER LIABILITIES ......................................             15,643              14,762
DEFERRED INCOME TAXES ..................................              3,217               2,052
                                                                  ---------           ---------
       TOTAL LIABILITIES ...............................            358,984             338,706
                                                                  ---------           ---------

MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES:
  COMPANY OBLIGATED MANDATORILY REDEEMABLE
  PREFERRED SECURITIES OF SUBSIDIARY TRUST HOLDING
  SOLELY DEBENTURES OF COMPANY .........................             98,905              98,905
                                                                  ---------           ---------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
  PREFERRED STOCK, $.01 PAR VALUE,
     10,000,000 SHARES AUTHORIZED,
       NONE ISSUED AND OUTSTANDING
  COMMON STOCK, NO PAR VALUE, 50,000,000 SHARES
     AUTHORIZED, 13,381,924 SHARES ISSUED ..............             68,825              68,859
  NOTES RECEIVABLE FROM SHAREHOLDERS ...................             (2,102)             (2,506)
  ACCUMULATED OTHER COMPREHENSIVE INCOME ...............             16,101              13,507
  RETAINED EARNINGS ....................................             99,431              93,766
  LESS COST OF COMMON STOCK HELD IN TREASURY,
     1,175,813 AND 791,016 SHARES ......................            (17,900)            (12,186)
                                                                  ---------           ---------
       TOTAL SHAREHOLDERS' EQUITY ......................            164,355             161,440
                                                                  ---------           ---------
       TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ......          $ 622,244           $ 599,051
                                                                  =========           =========
</TABLE>

         The accompanying notes are an integral part of the consolidated
                             financial statements.

                                       3
<PAGE>   4
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES

                    CONSOLIDATED STATEMENTS OF OPERATIONS AND
                              COMPREHENSIVE INCOME
                 (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                For the Three Months
                                                                   Ended March 31,
                                                           2000                        1999
                                                           ----                        ----
<S>                                                     <C>                    <C>
REVENUE:
   NET WRITTEN PREMIUMS ......................          $     58,128           $     42,805
   CHANGE IN NET UNEARNED
     PREMIUM RESERVE (INCREASE) ..............                (9,501)                (6,041)
                                                        ------------           ------------
   NET EARNED PREMIUMS .......................                48,627                 36,764
   NET INVESTMENT INCOME .....................                 6,264                  4,854
   NET REALIZED INVESTMENT GAIN (LOSS) .......                    93                   (490)
   OTHER INCOME ..............................                 2,725
                                                        ------------           ------------
     TOTAL REVENUE ...........................                57,709                 41,128
                                                        ------------           ------------

LOSSES AND EXPENSES:
   LOSS AND LOSS ADJUSTMENT EXPENSES .........                40,246                 22,515
   NET REINSURANCE RECOVERIES ................               (12,006)                (2,253)
                                                        ------------           ------------
   NET LOSS AND LOSS ADJUSTMENT EXPENSES .....                28,240                 20,262
   ACQUISITION COSTS AND OTHER UNDERWRITING
     EXPENSES ................................                16,719                 11,777
   OTHER OPERATING EXPENSES ..................                 2,810                    519
                                                        ------------           ------------
     TOTAL LOSSES AND EXPENSES ...............                47,769                 32,558
                                                        ------------           ------------

MINORITY INTEREST:  DISTRIBUTIONS ON
     COMPANY OBLIGATED MANDATORILY
     REDEEMABLE PREFERRED SECURITIES
     OF SUBSIDIARY TRUST .....................                 1,811                  1,811
                                                        ------------           ------------

INCOME BEFORE INCOME TAXES ...................                 8,129                  6,759
                                                        ------------           ------------

INCOME TAX EXPENSE (BENEFIT):
   CURRENT ...................................                 2,665                  2,045
   DEFERRED ..................................                  (201)                  (223)
                                                        ------------           ------------
     TOTAL INCOME TAX EXPENSE ................                 2,464                  1,822
                                                        ------------           ------------

     NET INCOME ..............................          $      5,665           $      4,937
                                                        ============           ============

OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
   HOLDING GAIN (LOSS) ARISING DURING PERIOD .          $      2,654           $       (763)
   RECLASSIFICATION ADJUSTMENT ...............                   (60)                   319
                                                        ------------           ------------
   OTHER COMPREHENSIVE INCOME (LOSS) .........                 2,594                   (444)
                                                        ------------           ------------
COMPREHENSIVE INCOME .........................          $      8,259           $      4,493
                                                        ------------           ------------

PER AVERAGE SHARE DATA:
   BASIC EARNINGS PER SHARE ..................          $       0.46           $       0.40
                                                        ============           ============
   DILUTED EARNINGS PER SHARE ................          $       0.38           $       0.33
                                                        ============           ============

WEIGHTED-AVERAGE COMMON SHARES
   OUTSTANDING ...............................            12,327,797             12,209,391
WEIGHTED-AVERAGE SHARE EQUIVALENTS
   OUTSTANDING ...............................             2,496,325              2,823,711
                                                        ------------           ------------
WEIGHTED-AVERAGE SHARES AND SHARE
   EQUIVALENTS OUTSTANDING ...................            14,824,122             15,033,102
                                                        ============           ============
</TABLE>

         The accompanying notes are an integral part of the consolidated
                             financial statements.

                                       4
<PAGE>   5
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF CHANGES
                             IN SHAREHOLDERS' EQUITY
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                              For the Three        For the Year Ended
                                                                            Months Ended March       December 31,
                                                                                 31, 2000                1999
                                                                                 --------                ----
                                                                                (Unaudited)

<S>                                                                         <C>                    <C>
COMMON STOCK:
  BALANCE AT BEGINNING OF YEAR..................................                 $ 68,859              $ 44,796
  ISSUANCE OF SHARES PURSUANT TO ACQUISITION
    AGREEMENT...................................................                                         25,000
  ISSUANCE OF SHARES PURSUANT TO EMPLOYEE
    STOCK PURCHASE PLAN.........................................                                           (420)
  EXERCISE OF EMPLOYEE STOCK OPTIONS, NET OF
    TAX BENEFIT.................................................                      (27)                 (517)
  SHARES FORFEITED PURSUANT TO EMPLOYEE
    STOCK PURCHASE PLAN.........................................                       (7)
                                                                                 --------              --------
      BALANCE AT END OF PERIOD..................................                   68,825                68,859
                                                                                 --------              --------
NOTES RECEIVABLE FROM SHAREHOLDERS:
  BALANCE AT BEGINNING OF PERIOD................................                   (2,506)               (1,680)
  NOTES RECEIVABLE ISSUED PURSUANT TO EMPLOYEE
    STOCK PURCHASE PLAN.........................................                                         (1,445)
  SHARES FORFEITED PURSUANT TO EMPLOYEE
    STOCK PURCHASE PLAN.........................................                      226
  COLLECTION OF NOTES RECEIVABLE................................                      178                   619
                                                                                 --------              --------
      BALANCE AT END OF PERIOD..................................                   (2,102)               (2,506)
                                                                                 --------              --------
ACCUMULATED OTHER COMPREHENSIVE INCOME:
  BALANCE AT BEGINNING OF PERIOD................................                   13,507                22,417
  OTHER COMPREHENSIVE INCOME, NET OF TAXES......................                    2,594                (8,910)
                                                                                 --------              --------
      BALANCE AT END OF PERIOD..................................                   16,101                13,507
                                                                                 --------              --------
RETAINED EARNINGS:
  BALANCE AT BEGINNING OF PERIOD................................                   93,766                74,923
  NET INCOME....................................................                    5,665                18,843
                                                                                 --------              --------
      BALANCE AT END OF PERIOD..................................                   99,431                93,766
                                                                                 --------              --------
COMMON STOCK HELD IN TREASURY:
  BALANCE AT BEGINNING OF PERIOD................................                  (12,186)               (2,973)
  COMMON SHARES REPURCHASED.....................................                   (5,549)              (12,081)
  ISSUANCE OF SHARES PURSUANT TO EMPLOYEE STOCK
    PURCHASE PLAN...............................................                                          1,893
  ISSUANCE OF SHARES PURSUANT TO DIRECTOR STOCK
    PURCHASE PLAN...............................................                        6
  EXERCISE OF EMPLOYEE STOCK OPTIONS, NET OF
    TAX BENEFIT.................................................                       48                   975
  SHARES FORFEITED PURSUANT TO EMPLOYEE STOCK
    PURCHASE PLAN...............................................                     (219)
                                                                                 --------              --------
      BALANCE AT END OF PERIOD..................................                  (17,900)              (12,186)
                                                                                 --------              --------
      TOTAL SHAREHOLDERS' EQUITY................................                 $164,355              $161,440
                                                                                 ========              ========
</TABLE>

         The accompanying notes are an integral part of the consolidated
                             financial statements.

                                       5
<PAGE>   6
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                         For the Three Months Ended March 31,
                                                                2000               1999
                                                                ----               ----
<S>                                                      <C>                     <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   NET INCOME ......................................          $  5,665           $  4,937
   ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH
     PROVIDED BY OPERATING ACTIVITIES:
     NET REALIZED INVESTMENT (GAIN) LOSS ...........               (93)               490
     DEPRECIATION AND AMORTIZATION EXPENSE .........               959                575
     DEFERRED INCOME TAX BENEFIT ...................              (201)              (223)
     CHANGE IN PREMIUMS RECEIVABLE .................             2,272             (1,353)
     CHANGE IN OTHER RECEIVABLES ...................            (4,442)            (2,066)
     CHANGE IN DEFERRED ACQUISITION COSTS ..........            (1,895)            (2,031)
     CHANGE IN OTHER ASSETS ........................               583               (613)
     CHANGE IN UNPAID LOSS AND LOSS ADJUSTMENT
       EXPENSES ....................................            10,346              5,770
     CHANGE IN UNEARNED PREMIUMS ...................             6,691              7,931
     CHANGE IN OTHER LIABILITIES ...................             2,076                (71)
                                                              --------           --------
         NET CASH PROVIDED BY OPERATING ACTIVITIES .            21,961             13,346
                                                              --------           --------

CASH FLOWS FROM INVESTING ACTIVITIES:
   PROCEEDS FROM SALES OF INVESTMENTS IN FIXED
       MATURITIES AVAILABLE FOR SALE ...............            23,504             28,953
   PROCEEDS FROM MATURITY OF INVESTMENTS IN FIXED
       MATURITIES AVAILABLE FOR SALE ...............             7,245              3,325
   PROCEEDS FROM SALES OF INVESTMENTS IN EQUITY
       SECURITIES ..................................             8,606              2,120
   COST OF FIXED MATURITIES SECURITIES AVAILABLE FOR
       SALE ACQUIRED ...............................           (42,073)           (42,002)
   COST OF EQUITY SECURITIES ACQUIRED ..............           (13,829)            (6,877)
   PURCHASE OF PROPERTY AND EQUIPMENT ..............              (872)              (994)
                                                              --------           --------
       NET CASH USED BY INVESTING ACTIVITIES .......           (17,419)           (15,475)
                                                              --------           --------

CASH FLOWS FROM FINANCING ACTIVITIES:
   EXERCISE OF EMPLOYEE STOCK OPTIONS, NET
     OF TAX BENEFIT ................................                21                228
   ISSUANCE OF SHARES PURSUANT TO DIRECTOR
     STOCK PURCHASE PLAN ...........................                 6
   COLLECTION OF NOTES RECEIVABLE ..................               178                170
   COST OF COMMON STOCK REPURCHASED ................            (5,549)
                                                              --------           --------
         NET CASH PROVIDED (USED) BY FINANCING
           ACTIVITIES ..............................            (5,344)               398
                                                              --------           --------

NET DECREASE IN CASH AND CASH EQUIVALENTS ..........              (802)            (1,731)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ...            26,230             31,573
                                                              --------           --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD .........          $ 25,428           $ 29,842
                                                              ========           ========

CASH PAID DURING THE PERIOD FOR:
   INCOME TAXES ....................................          $                  $

NON-CASH TRANSACTIONS:
   ISSUANCE OF SHARES (FORFEITURES) PURSUANT TO
    EMPLOYEE STOCK PURCHASE PLAN IN EXCHANGE FOR
    NOTES RECEIVABLE ...............................          $   (226)          $    (33)
</TABLE>

         The accompanying notes are an integral part of the consolidated
                             financial statements.

                                       6
<PAGE>   7
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   Basis of Presentation

     The consolidated financial statements as of and for the three months ended
     March 31, 2000 and 1999 are unaudited, but in the opinion of management,
     have been prepared on the same basis as the annual audited consolidated
     financial statements and reflect all adjustments, consisting of normal
     recurring accruals, necessary for a fair presentation of the information
     set forth therein. The results of operations for the three months ended
     March 31, 2000 are not necessarily indicative of the operating results to
     be expected for the full year or any other period. Certain prior year
     amounts have been reclassified for comparative purposes.

     These financial statements should be read in conjunction with the financial
     statements and notes as of and for the year ended December 31, 1999
     included in the Company's Annual Report on Form 10-K.

2.   Acquisitions

     On July 16, 1999, Philadelphia Consolidated Holding Corp. (the "Company")
     closed on its acquisition of Liberty American Insurance Group, Inc.
     ("Liberty") for a purchase price of $45.0 million, and a contingent
     additional amount of up to $5.0 million based upon the future earnings for
     the acquired business. Of the purchase price, $20.0 million was paid in
     cash and the balance in 1,037,772 shares of common stock of the Company.
     Any contingent additional amount will be paid in cash. The acquisition is
     being accounted for using the purchase method of accounting.

3.   Goodwill

     Goodwill resulting from the acquisition of Liberty amounted to $29.2
     million. This amount represents the excess of acquisition costs over the
     fair value of net assets acquired. Goodwill is being amortized on a
     straight-line basis over 20 years.

4.   Earnings Per Share

     Earnings per common share has been calculated by dividing net income for
     the period by the weighted average number of common shares and common share
     equivalents outstanding during the period.

5.   Income Taxes

     The effective tax rate differs from the 35% marginal tax rate principally
     as a result of interest exempt from tax, the dividend received deduction
     and other differences in the recognition of revenues and expenses for tax
     and financial reporting purposes.

6.   Comprehensive Income

     Components of comprehensive income, as detailed in the Consolidated
     Statements of Operations and Comprehensive Income, are net of tax. The
     related tax effect of Holding Gains (Losses) arising during the quarter was
     $1.4 million and ($0.4) million for the three months ended March 31, 2000
     and 1999, respectively. The related tax effect of Reclassification
     Adjustments was $0.2 million in 1999.

7.   Segment Information

     The Company has divided its operations into four reportable segments: The
     Commercial Lines Underwriting Group which has underwriting responsibility
     for the Commercial Automobile and Commercial multi-peril package insurance
     products; The Specialty Lines Underwriting Group which has underwriting
     responsibility for the professional liability insurance products; The
     Specialty Property Underwriting Group which has underwriting responsibility
     for the large property and Inland Marine insurance products; and The
     Personal Lines Group which designs, markets and underwrites personal
     property and casualty insurance products for the

                                       7
<PAGE>   8
     Mobile Homeowners and Homeowners markets. The reportable segments operate
     solely within the United States. The segments follow the same accounting
     policies used for the Company's consolidated financial statements.
     Management evaluates a segment's performance based upon underwriting
     results.

     Following is a tabulation of business segment information for the three
     months ended March 31, 2000 and 1999. Corporate information is included to
     reconcile segment data to the consolidated financial statements (in
     thousands):

<TABLE>
<CAPTION>
                                               Commercial   Specialty     Personal       Specialty
                                                 Lines        Lines         Lines        Property       Corporate        Total
                                               ---------------------------------------------------------------------------------
<S>                                            <C>          <C>           <C>            <C>            <C>            <C>
March 31, 2000:
Gross Written Premiums                         $40,304       $16,231       $ 16,145       $4,466                       $ 77,146
                                               ---------------------------------------------------------------------------------
Net Written Premiums                           $26,838       $18,066       $ 11,169       $2,055                       $ 58,128
                                               ---------------------------------------------------------------------------------
Revenue:
  Net Earned Premiums                          $28,536       $11,721       $  6,278       $2,092                       $ 48,627
  Net Investment Income                                                       1,195                        5,069          6,264
  Net Realized Investment Gain (Loss)                                           (35)                         128             93
  Other Income                                                                3,689                         (964)         2,725
                                               ---------------------------------------------------------------------------------
  Total Revenue                                 28,536        11,721         11,127        2,092           4,233         57,709
                                               ---------------------------------------------------------------------------------
Losses and Expenses:
   Net Loss and Loss Adjustment Expenses        16,207         7,358          3,249        1,426                         28,240
   Acquisition Costs and Other Underwriting
     Expenses                                                                 1,746                       14,973         16,719
   Other Operating Expenses                                                   2,285                          525          2,810
                                               ---------------------------------------------------------------------------------
   Total Losses and Expenses                    16,207         7,358          7,280        1,426          15,498         47,769
                                               ---------------------------------------------------------------------------------
Minority Interest:  Distributions on
   Company Obligated Mandatorily Redeemable
   Preferred Securities of Subsidiary Trust                                                                1,811          1,811
                                               ---------------------------------------------------------------------------------
Income Before Income Taxes                      12,329         4,363          3,847          666         (13,076)         8,129
Total Income Tax Expense                                                                                   2,464          2,464
                                               ---------------------------------------------------------------------------------
Net Income                                     $12,329       $ 4,363       $  3,847       $  666        $(15,540)      $  5,665
                                               =================================================================================
Total Assets                                                               $135,703                     $486,541       $622,244
                                               =================================================================================
March 31, 1999:
Gross Written Premiums                         $40,575       $10,914       $  2,009       $4,592                       $ 58,090
                                               ---------------------------------------------------------------------------------
Net Written Premiums                           $27,974       $ 9,091       $  1,735       $4,005                       $ 42,805
                                               ---------------------------------------------------------------------------------
Revenue:
  Net Earned Premiums                          $27,737       $ 7,282       $    929       $  816                       $ 36,764
  Net Investment Income                                                                                    4,854          4,854
  Net Realized Investment Loss                                                                              (490)          (490)
                                               ---------------------------------------------------------------------------------
  Total Revenue                                 27,737         7,282            929          816           4,364         41,128
                                               ---------------------------------------------------------------------------------
Losses and Expenses:
   Net Loss and Loss Adjustment Expenses        15,159         4,121            478          504                         20,262
   Acquisition Costs and Other Underwriting
     Expenses                                                                                             11,777         11,777
   Other Operating Expenses                                                                                  519            519
                                               ---------------------------------------------------------------------------------
   Total Losses and Expenses                    15,159         4,121            478          504          12,296         32,558
                                               ---------------------------------------------------------------------------------

Minority Interest:  Distributions on
   Company Obligated Mandatorily Redeemable
   Preferred Securities of Subsidiary Trust                                                                1,811          1,811
                                               ---------------------------------------------------------------------------------
Income Before Income Taxes                      12,578         3,161            451          312          (9,743)         6,759
Total Income Tax Expense                                                                                   1,822          1,822
                                               ---------------------------------------------------------------------------------
Net Income                                     $12,578       $ 3,161       $    451       $  312        $(11,565)      $  4,937
                                               =================================================================================
Total Assets                                                                                            $490,013       $490,013
                                               =================================================================================
</TABLE>

                                       8
<PAGE>   9
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES
               MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
                       OPERATIONS AND FINANCIAL CONDITION

GENERAL

Although the Company's financial performance is dependent upon its own specific
business characteristics, certain risk factors can affect the profitability of
the Company. These include:

-    Industry factors - Historically the financial performance of the commercial
     and personal property and casualty insurance industry has tended to
     fluctuate in cyclical patterns of soft markets followed by hard markets. In
     the current environment, insurance industry pricing in general continues to
     be soft; however, the Company's strategy is to focus on underwriting
     profits and accordingly the Company's marketing organization is being
     directed into those niche businesses that exhibit the greatest potential
     for underwriting profits.

-    Competition - The Company competes in the commercial and personal property
     and casualty business with other domestic and international insurers having
     greater financial and other resources than the Company.

-    Regulation - The Company's insurance subsidiaries are subject to a
     substantial degree of regulatory oversight, which generally is designed to
     protect the interests of policyholders, as opposed to shareholders.

-    Inflation - Commercial and personal property and casualty insurance
     premiums are established before the amount of losses and loss adjustment
     expenses, or the extent to which inflation may effect such amounts is
     known.

-    Investment Risk - Substantial future increases in interest rates could
     result in a decline in the market value of the Company's investment
     portfolio and resulting losses and/or reduction in shareholders' equity.

-    Catastrophe Exposure - The Company's insurance subsidiaries issue insurance
     policies which provide coverage for commercial and personal property and
     casualty risks. It is possible that a catastrophic event could greatly
     increase claims under these insurance policies.


RESULTS OF OPERATIONS (THREE MONTHS ENDED MARCH 31, 2000 VS MARCH 31, 1999)

         Premiums: Gross written premiums grew $19.0 million (32.7%) to $77.1
million for the three months ended March 31, 2000 from $58.1 million for the
same period of 1999; gross earned premiums grew $20.5 million (40.7%) to $70.9
million for the three months ended March 31, 2000 from $50.4 million for the
same period of 1999; net written premiums increased $15.3 million (35.7%) to
$58.1 million for the three months ended March 31, 2000 from $42.8 million for
the same period of 1999; and net earned premiums grew $11.8 million (32.1%) to
$48.6 million in 2000 from $36.8 million in 1999. The overall growth in premiums
are attributable to a number of factors:

-    Expansion of marketing efforts relating to specialty lines products through
     the Company's field organization and preferred agents. The respective gross
     written and net written premium increases for specialty lines products for
     the three months ended March 31, 2000 vs. 1999 amount to $5.3 million and
     $9.0 million.

-    The acquisition of Liberty, resulting in an increase of $14.1 million and
     $9.3 million in gross and net mobile homeowners, preferred homeowners and
     National Flood Insurance Program written premiums, respectively.

         Overall premium growth has been offset in part by the Company's
decision not to renew certain commercial automobile policies in the commercial
lines segment and certain policies in the specialty property segment due to
inadequate pricing levels being experienced as a result of market conditions
and/or loss experience emerging at higher than expected levels. As a result, the
aggregate total gross written and net written premiums for the commercial lines
and specialty property and inland marine products decreased by $0.3 million and
$1.1 million for commercial lines products, and $0.1 million and $1.9 million
for specialty property and inland marine products.

                                       9
<PAGE>   10
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES
               MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
                       OPERATIONS AND FINANCIAL CONDITION
                                   (Continued)

         Net Investment Income: Net investment income approximated $6.3 million
for the three months ended March 31, 2000 and $4.9 million for the same period
of 1999. Total investments grew to $412.4 million at March 31, 2000 from $372.5
million at March 31, 1999. The growth in investment income is due to investing
net cash flows provided from operating activities, the reinvesting of the
proceeds from 1999 common stock sales in fixed maturity securities, and the
investable assets acquired in the Company's acquisition.

         Other Income: Other income approximated $2.7 million for the three
months ended March 31, 2000 and $0.0 for the same period of 1999. This increase
is primarily attributed to commissions earned on personal lines brokered
business.

         Net Loss and Loss Adjustment Expenses: Net loss and loss adjustment
expenses increased $7.9 million (38.9%) to $28.2 million in the first quarter of
2000 from $20.3 million in the first quarter of 1999 and the loss ratio
increased to 58.1% in 2000 from 55.1% in 1999. The increase in net loss and loss
adjustment expenses was due principally to the 32.1% growth in net earned
premiums and in part to growth in product lines with higher relative loss
experience.

         Acquisition Costs and Other Underwriting Expenses: Acquisition costs
and other underwriting expenses increased $4.9 million (41.5%) to $16.7 million
for the three months ended March 31, 2000 from $11.8 million for the same period
of 1999. This increase was due primarily to the 32.1% growth in net earned
premiums and in part to the relatively higher acquisition costs as a result of
the changes in the Company's product and associated distribution channel mix
(see results of operations - "Premiums").

         Other Operating Expenses: Other operating expenses increased $2.3
million to $2.8 million in the first quarter of 2000 from $0.5 million for the
same period of 1999. The increase in other operating expenses was primarily due
to the following: operating expenses of the Company's brokered personal lines
business ($1.9 million); and goodwill amortization ($0.4 million), both arising
from the acquisition of Liberty.

         Income Tax Expense: The Company's effective tax rate for the three
months ended March 31, 2000 and 1999 was 30.3% and 27.0%, respectively. The
effective rates differed from the 35% statutory rate principally due to
investments in tax-exempt securities offset in part by non-deductible goodwill
amortization. The increase in the effective tax rate is principally due to a
greater investment of cash flows in taxable securities relative to tax-exempt
securities.


LIQUIDITY AND CAPITAL RESOURCES

         For the three months ended March 31, 2000 the Company's investments
experienced unrealized investment appreciation of $2.6 million, net of the
related deferred tax expense of $1.4 million. At March 31, 2000, the Company had
total investments with a carrying value of $412.4 million, of which 80.0%
consisted of investments in investment grade fixed maturity securities,
including U.S. treasury securities and obligations of U.S. government
corporations and agencies, obligations of states and political subdivisions,
corporate debt securities, collateralized mortgage securities and asset backed
securities. The collateralized mortgage securities and asset backed securities
consist of short tranche securities possessing favorable pre-payment risk
profiles. The remaining 20.0% of the Company's total investments consisted
primarily of publicly traded common stock securities.

         The Company purchased 377,100 shares of its common stock during the
first quarter of 2000 for $5.5 million under its stock buyback authorization.

         The Company produced net cash from operations of $22.0 million and
$13.3 million, respectively, for the three months ended March 31, 2000 and 1999.
The first quarter of 2000 included net cash from operations of $6.8 million from
the acquisition of Liberty. Management believes that the Company has adequate
ability to pay all claims and meet all other cash needs.

                                       10
<PAGE>   11
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES
               MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
                       OPERATIONS AND FINANCIAL CONDITION
                                  (Continued)

         Risk-based capital is designed to measure the acceptable amount of
capital an insurer should have based on the inherent specific risks of each
insurer. Insurers failing to meet this benchmark capital level may be subject to
scrutiny by the insurer's domiciliary insurance department and ultimately
rehabilitation or liquidation. Based on the standards currently adopted, the
Company's insurance subsidiaries' capital and surplus is in excess of the
prescribed risk-based capital requirements.


YEAR 2000 ISSUES

         Many existing computer programs use only two digits, instead of four,
to identify a year in the date field. These programs were designed and developed
without considering the impact of the upcoming change in the century. If not
corrected, many computer applications could fail or create incorrect results on
or after the Year 2000. The "Year 2000" issue affects computer and information
technology systems, as well as non-information technology systems which include
embedded technology such as micro-processors and micro-controllers (or
micro-chips) that have date sensitive programs that may not properly recognize
the year 2000 or beyond.

         The Company issues professional liability coverage, including directors
and officers liability, and commercial multi-peril insurance policies. Coverage
under certain of these policies may cover losses suffered by insureds as a
result of the Year 2000 issues. Professional liability policies are written on a
"claim made and reported" basis. Since early 1997 approximately 50% of these
policies have included a Year 2000 exclusion endorsement. The Company includes a
Year 2000 exclusion endorsement on virtually all new or renewing professional
liability policies providing coverage effective January 1, 1999 and thereafter.
On occasion, for qualifying accounts, the Company's underwriters may remove the
exclusion after receipt and review of a satisfactory supplemental application
(which includes a warranty statement) and other underwriting information. With
respect to commercial multi-peril policies, the Company believes that it should
not be held liable for claims arising from the Year 2000 issue under
comprehensive general liability policies. However, the Company cannot determine
whether or to what extent courts may find liability for such claims.
Additionally, expenses could be incurred to contest Year 2000 issue coverage
claims, even if the Company prevails in its position. As a result, it cannot
presently be determined what, if any, insurance exposure ultimately exists for
Year 2000 issue claims. However, no Year 2000 issue claims have been reported to
the Company as of May 3, 2000. There can be no assurance that such Year 2000
issues will not materially adversely affect the Company.


FORWARD-LOOKING INFORMATION

         Certain information included in this report and other statements or
materials published or to be published by the Company are not historical facts
but are forward-looking statements relating to such matters as anticipated
financial performance, business prospects, technological developments, new and
existing products, expectations for market segment and growth, the impact of
Year 2000 issues, and similar matters. In connection with the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995, the Company
provides the following cautionary remarks regarding important factors which,
among others, could cause the Company's actual results and experience to differ
materially from the anticipated results or other expectations expressed in the
Company's forward-looking statements. The risks and uncertainties that may
affect the operations, performance, development, results of the Company's
business, and the other matters referred to above include, but are not limited
to: (i) changes in the business environment in which the Company operates,
including inflation and interest rates; (ii) changes in taxes, governmental
laws, and regulations; (iii) competitive product and pricing activity; (iv)
difficulties of managing growth profitably; (v) catastrophe losses; and (vi) the
impact of Year 2000 issues, including the matters referred to above.

                                       11
<PAGE>   12
            PHILADELPHIA CONSOLIDATED HOLDING CORP. AND SUBSIDIARIES
                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

         Not applicable.

Item 2.  Changes in Securities and Use of Proceeds

         Not applicable.

Item 3.  Defaults Upon Senior Securities

         Not applicable.

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

         Not applicable

Item 5.  Other information

         Not applicable.

Item 6.  Exhibits and Reports on Form 8-K

<TABLE>
<CAPTION>
<S>               <C>                       <C>
         a.       Exhibits
                  Exhibit No.               Description

                  11.0                      Computation of Earnings Per Share

         b.       The Company filed the following reports on Form 8-K during the
                  quarterly period ended March 31, 2000:
</TABLE>


<TABLE>
<CAPTION>
                  Date of Report                  Item Reported
                  --------------                  -------------
<S>                                            <C>
                  March 17, 2000               Press Release dated February 11, 2000
</TABLE>

                                       12
<PAGE>   13
                                   SIGNATURES



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




                                   PHILADELPHIA CONSOLIDATED HOLDING CORP.
                                   Registrant


Date  May 8, 2000                  /s/ James J. Maguire
      ------------------------     -------------------------------------------
                                   James J. Maguire
                                   Chairman of the Board of Directors,
                                   and Chief Executive Officer
                                   (Principal Executive Officer)


Date  May 8, 2000                  /s/ Craig P. Keller
      ------------------------     -------------------------------------------
                                   Craig P. Keller
                                   Senior Vice President, Secretary,
                                   Treasurer and Chief Financial Officer
                                   (Principal Financial and Accounting
                                   Officer)

                                       13