EXHIBIT 11.1

EFJ, INC. AND SUBSIDIARIES

COMPUTATION OF NET INCOME (LOSS) PER SHARE

(Unaudited and in thousands, except share and per share data)



|                                                     |  |                                 |            |                                |   |            |  |      |            |  |   |           
|---------------------------------------------------- |  | ------------------------------- | ---------- | ------------------------------ | - | ---------- |  | ---- | ---------- |  | - | ----------
|                                                     |  | Three Months EndedSeptember 30, |            | Nine Months EndedSeptember 30,
|                                                     |  | 2006                            |            | 2005                           |   | 2006       |  | 2005
|Net income (loss)                                    |  | $                               | 235        |                                | $ | 1,603      |  |      | 1,010      |  | $ | 7,141     
|                                                     |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Net income (loss) per share  Basic:                 |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Weighted average common shares  Basic               |  |                                 | 25,850,910 |                                |   | 21,382,815 |  |      | 25,786,307 |  |   | 19,423,717
|                                                     |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Net income (loss) per share  Basic                  |  | $                               | 0.01       |                                | $ | 0.07       |  | $    | 0.04       |  | $ | 0.37      
|                                                     |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Net income (loss) per share  Diluted:               |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Shares used in this computation:                     |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Weighted average common shares  Basic               |  |                                 | 25,850,910 |                                |   | 21,382,815 |  |      | 25,786,307 |  |   | 19,423,717
|Dilutive effect of shares under employee stock plans |  |                                 | 108,777    |                                |   | 280,856    |  |      | 174,356    |  |   | 356,042   
|Weighted average restricted shares granted           |  |                                 | 232,500    |                                |   |           |  |      | 216,933    |  |   |          
|                                                     |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Weighted average common shares  Diluted             |  |                                 | 26,192,187 |                                |   | 21,663,671 |  |      | 26,177,596 |  |   | 19,779,759
|                                                     |  |                                 |            |                                |   |            |  |      |            |  |   |           
|Net income (loss) per share  Diluted                |  | $                               | 0.01       |                                | $ | 0.07       |  | $    | 0.04       |  | $ | 0.36      
|                                                     |  |                                 |            |                                |   |            |  |      |            |  |   |