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 Ended June 30, |            | Six Months Ended June 30,
|                                                     |  | 2006                        |            | 2005                      |   | 2006       |  | 2005
|Net income (loss)                                    |  | $                           | 3,876      |                           | $ | 295        |  | $    | 775        |  | $ | 5,538     
|                                                     |  |                             |            |                           |   |            |  |      |            |  |   |           
|Net income (loss) per share  Basic:                 |  |                             |            |                           |   |            |  |      |            |  |   |           
|Weighted average common shares  Basic               |  |                             | 25,795,758 |                           |   | 18,518,964 |  |      | 25,753,471 |  |   | 18,416,004
|                                                     |  |                             |            |                           |   |            |  |      |            |  |   |           
|Net income (loss) per share  Basic                  |  | $                           | 0.15       |                           | $ | 0.02       |  | $    | 0.03       |  | $ | 0.30      
|                                                     |  |                             |            |                           |   |            |  |      |            |  |   |           
|Net income (loss) per share  Diluted:               |  |                             |            |                           |   |            |  |      |            |  |   |           
|Shares used in this computation:                     |  |                             |            |                           |   |            |  |      |            |  |   |           
|Weighted average common shares  Basic               |  |                             | 25,795,758 |                           |   | 18,518,964 |  |      | 25,753,471 |  |   | 18,416,004
|Dilutive effect of shares under employee stock plans |  |                             | 167,726    |                           |   | 329,068    |  |      | 229,473    |  |   | 393,635   
|Weighted average restricted shares granted           |  |                             | 232,500    |                           |   |           |  |      | 209,019    |  |   |          
|                                                     |  |                             |            |                           |   |            |  |      |            |  |   |           
|Weighted average common shares  Diluted             |  |                             | 26,195,984 |                           |   | 18,848,032 |  |      | 26,191,963 |  |   | 18,809,639
|                                                     |  |                             |            |                           |   |            |  |      |            |  |   |           
|Net income (loss) per share  Diluted                |  | $                           | 0.15       |                           | $ | 0.02       |  | $    | 0.03       |  | $ | 0.29      
|                                                     |  |                             |            |                           |   |            |  |      |            |  |   |