##### 





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
  Form 10-K
   þ

ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) 
    OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2007ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For 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

(I.R.S. Employerincorporation or
    organization)

Identification No.)28819 Franklin Road

48034Southfield, Michigan

(Zip Code)(Address of principal executive
    offices)   (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 RegisteredCommon Stock, No par value

Nasdaq Stock Market   Securities registered pursuant to Section 12(g) of the
    Act:
 None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K.  Yes þ o
  Rule 12b-2
  Large accelerated
    filer o

Accelerated
    filer o

Non-accelerated
    filer þ

Smaller reporting
    company o(Do not check if a smaller reporting company)   Rule 12b-2 o þ




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##### 





FORM 10-K
  TABLE OF CONTENTS
  PagePART I:Item 1.


Business


3Item 1A.


Risk Factors


23Item 1B.


Unresolved Staff Comments


33Item 2.


Properties


33Item 3.


Legal Proceedings


34Item 4.


Submission of Matters to a Vote of Security Holders


34PART II:Item 5.


Market for Registrants Common Equity, Related Stockholder
    Matters and Issuer Purchases of Equity Securities


34Item 6.


Selected Financial Data


36Item 7.


Managements Discussion and Analysis of Financial Condition
    and Results of Operation


38Item 7A.


Quantitative and Qualitative Disclosures About Market Risk


56Item 8.


Financial Statements and Supplementary Data


57Item 9.


Changes in and Disagreements with Accountants on Accounting and
    Financial Disclosure


59Item 9A.


Controls and Procedures


59Item 9B.


Other Information


59PART III:Item 10.


Directors, Executive Officers and Corporate Governance


60Item 11.


Executive Compensation


63Item 12.


Security Ownership of Certain Beneficial Owners and Management
    and Related Stockholder Matters


78Item 13.


Certain Relationships and Related Transactions, and Director
    Independence


79Item 14.


Principal Accounting Fees and Services


80PART IV:Item 15.


Exhibits, Financial Statement Schedules


81Item 15(a)(1).


Financial Statements and Reports of Independent Registered
    Public Accounting Firm


81Item 15(a)(2).


Financial Statement Schedules


121Item 15(a)(3).


Exhibit Index


132  2




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##### 



PART I  Item 1.
    BUSINESS.  Form 10-K.
  Form 10-K:
        The
    Company
   3




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##### 



Industry
    Information
       4




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##### 



Our
    Product Lines
    Years Ended December 31,2007


2006


2005% of





% of





% ofAmount


Total


Amount


Total


Amount


Total(Dollars in thousands)Commercial Lines:Liquor liability

$
10,967



11.6
%

$
10,477



12.9
%

$
10,913



12.9
%General liability


34,108



36.2
%


16,907



15.1
%


12,807



15.1
%Total liability


45,075



47.8
%


27,384



28.0
%


23,720



28.0
%Property


12,467



13.2
%


7,320



7.4
%


6,299



7.4
%Commercial multi-peril


1,660



1.8
%


15,932



26.2
%


22,230



26.3
%Commercial automobile


10,702



11.4
%


5,823



7.3
%


6,156



7.3
%Workers compensation


14,018



14.9
%






0.0
%






0.0
%Other


4,509



4.8
%


2,997



3.2
%


2,661



3.1
%Total commercial lines


88,431



93.9
%


59,456



72.1
%


61,066



72.1
%Personal Lines:Automobile






0.0
%






1.7
%


1,459



1.7
%Homeowners


4,905



5.2
%


7,195



26.2
%


22,184



26.2
%Other


843



0.9
%






0.0
%






0.0
%Total personal lines


5,748



6.1
%


7,195



27.9
%


23,643



27.9
%Total net premiums earned from continuing operations

$
94,179



100.0
%

$
66,651



100.0
%

$
84,709



100.0
%   Commercial
    Insurance Products
    Liquor Liability.
  General Liability.
 5




---



##### 



Property.
  Commercial Multi-Peril.
  Commercial Automobile.
    Workers compensation.
  Other Program Business.
  Personal
    Insurance Products
    Automobile.
 6




---



##### 



Homeowners and Dwelling/Fire. and/or
  Other Program Business.
  Agency
    Services
    Administrative
    Services
     7




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##### 



Geographic
    Distribution
    Years Ended December 31,State

2007


2006


2005Florida


38.7
%


55.9
%


60.6
%Michigan


17.5
%


23.4
%


22.0
%Georgia


5.6
%


0.1
%


0.1
%South Carolina


5.4
%


0.0
%


0.0
%North Carolina


5.0
%


0.0
%


0.0
%Indiana


4.0
%


5.2
%


5.2
%Illinois


2.8
%


3.9
%


3.8
%Ohio


2.7
%


3.3
%


2.4
%Arkansas


2.3
%


0.1
%


0.0
%Tennessee


1.8
%


0.3
%


0.0
%All others


14.2
%


7.8
%


5.9
%100.0
%


100.0
%


100.0
%   Marketing
    and Distribution
        Underwriting
    and Pricing
  Commercial Lines.
 8




---



##### 



Personal Lines.
  Claims
    Handling
      Unpaid
    Losses and Loss Adjustment Expenses
    case-by-case
       9




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##### 



Net Reserves at December 31, 2007


Total NetPersonal


Commercial





Reserves atLines


Lines





December 31,Segment


Segment


Total


2006(Dollars in thousands)Low end of range

$
2,229


$
112,535


$
114,764


$
53,672Carried reserves


2,299



118,824



121,123



56,434High end of range


2,384



130,453



132,837



60,715  10




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##### 



2007


2006


2005Increase





Increase





Increase(Decrease) in





(Decrease) in





(Decrease) inNet


Estimate of


Net


Estimate of


Net


Estimate ofReserves at


Beginning of


Reserves at


Beginning of


Reserves at


Beginning ofBeginning of


Year Net


Beginning of


Year Net


Beginning of


Year NetYear


Reserves


Year


Reserves


Year


Reserves(Dollars in thousands)Lines of BusinessRBT and bowling center

$
21,519


$
1,143


$
21,476


$
(6,560
)

$
23,998


$
(2,080
)Commercial automobile


5,816



958



6,310



(203
)


3,394



(191
)North Pointe Casualty run off


68



(17
)


127



15



557



(100
)Florida small business


21,456



1,562



14,510



3,004



17,393



(848
)Other


1,388



811



1,764



(209
)


2,120



(244
)Total commercial lines


50,247



4,457



44,187



(3,953
)


47,462



(3,463
)Personal automobile


1,570



(303
)


2,767



1,779



10,506



(1,290
)Homeowners


3,025



(705
)


4,835



(320
)


2,049



(682
)Total personal lines


4,595



(1,008
)


7,602



1,459



12,555



(1,972
)Total lines

$
54,842


$
3,449


$
51,789


$
(2,494
)

$
60,017


$
(5,435
)    11




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##### 



12




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##### 



Analysis
    of Loss and Loss Adjustment Expense Development
  Years Ended December 31,1997


1998


1999


2000


2001


2002


2003


2004


2005


2006


2007(Dollars in thousands)Cumulative amount of net liability paid as of:One year later

$
5,821


$
14,070


$
17,508


$
17,896


$
20,687


$
20,472


$
18,778


$
22,334


$
21,775


$
24,368Two years later


10,099



22,802



28,730



28,100



32,798



32,000



30,453



35,520



36,997Three years later


12,881



29,385



34,019



33,796



39,098



38,680



37,067



44,497Four years later


13,909



32,219



36,259



36,000



42,443



41,940



41,318Five years later


14,290



33,462



36,969



36,653



43,629



43,758Six years later


14,589



33,724



37,068



36,813



44,261Seven years later


14,563



33,752



37,103



36,963Eight years later


14,571



33,780



37,193Nine years later


14,588



33,719Ten years later


14,513Gross liability-end of year


24,556



60,595



66,561



70,749



87,201



82,949



76,319



96,561



117,757



88,073



172,264Reinsurance recoverable on unpaid losses(1)


3,846



14,555



16,449



20,544



30,497



28,446



22,681



36,544



60,022



33,231



51,141Net liability-end of year


20,710



46,040



50,112



50,205



56,704



54,503



53,638



60,017



57,735



54,842



121,123Gross liability re-estimated- latest


20,163



49,743



59,133



67,373



74,307



68,412



69,696



97,831



122,342



102,228Reinsurance recoverable on unpaid losses re-estimated- latest


5,572



15,647



21,166



28,255



28,948



22,690



24,274



43,147



65,374



43,937Net liability re-estimated-latest


14,591



34,096



37,967



39,118



45,359



45,722



45,422



54,684



56,968



58,291Gross cumulative redundancy (deficiency)

$
4,393


$
10,852


$
7,428


$
3,376


$
12,894


$
14,537


$
6,623


$
(1,270
)

$
(4,585
)

$
(14,155
)Net liability for losses and loss expenses

$
20,710


$
46,040


$
50,112


$
50,205


$
56,704


$
54,503


$
53,638


$
60,017


$
57,735


$
54,842


$
121,123Liability re-estimated as of:One year later


18,388



42,782



47,575



46,431



51,548



48,871



50,172



54,582



55,242



58,291Two years later


16,287



38,995



43,018



44,734



46,998



47,605



46,024



53,718



56,968Three years later


16,401



36,634



40,967



41,084



46,204



46,662



45,249



54,684Four years later


15,124



35,457



39,092



39,888



45,805



46,214



45,422Five years later


15,065



34,912



38,572



39,627



45,738



45,722Six years later


15,094



34,535



38,286



39,269



45,359Seven years later


14,871



34,280



38,080



39,118Eight years later


14,694



34,222



37,967Nine years later


14,690



34,096Ten years later


14,591Net cumulative redundancy (deficiency)

$
6,119


$
11,944


$
12,145


$
11,087


$
11,345


$
8,781


$
8,216


$
5,333


$
767


$
(3,449
)     (1)
    
    The December 31, 2005 reinsurance recoverable on unpaid
    losses includes $5,955,000 recoverable attributable to the
    Citizens assessment. (See Insolvency Funds and
    Associations; Mandatory Pools and Insurance Facilities).   13




---



##### 



As of December 31,2007


2006


2005(Dollars in thousands)Case:Commercial lines productsLiability

$
14,353


$
12,061


$
13,180Property


10,561



9,643



8,246Commercial multi-peril


10,476



14,483



19,942Commercial automobile


10,149



3,705



4,325Workers compensation


41,624







Other


1,785



1,063



772Total commercial lines


88,948



40,955



46,465Personal lines productsPersonal automobile


3,388



4,758



6,128Homeowners


1,325



2,713



8,893Total personal lines


4,713



7,471



15,021Total


93,661



48,426



61,486IBNR:Commercial lines productsLiability

$
24,435


$
12,042


$
13,742Property


788



786



3,868Commercial multi-peril


12,009



18,628



14,613Commercial automobile


14,850



2,851



2,622Workers compensation


22,749







Other


1,075



511



805Total commercial lines


75,906



34,818



35,650Personal lines productsPersonal automobile


2,399



4,015



9,451Homeowners


222



2,496



11,191Personal Other


76







Total personal lines


2,697



6,511



20,642Total


78,603



41,329



56,292Total:Commercial lines productsLiability

$
38,788


$
24,103


$
26,922Property


11,349



10,429



12,114Commercial multi-peril


22,485



33,111



34,555Commercial automobile


24,999



6,556



6,947Workers compensation


64,373







Other


2,860



1,574



1,577Total commercial lines


164,854



75,773



82,115Personal lines productsPersonal automobile


5,787



8,773



15,579Homeowners


1,547



5,209



20,084Personal Other


76







Total personal lines


7,410



13,982



35,663Total

$
172,264


$
89,755


$
117,778  14




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##### 



Cash and
    Investments
          2007


2006Percent of





Percent ofAmount


Portfolio


Amount


Portfolio(Dollars in thousands)Fixed-income:U.S. governmental and agency securities

$
15,077



5.5
%

$
30,526



18.4
%Foreign government


307



0.1
%


300



0.1
%Corporate securities


68,393



25.2
%


29,421



17.7
%Municipal securities


38,516



14.2
%


7,035



4.2
%Mortgage-backed securities


66,185



24.2
%


32,360



19.5
%Asset-backed securities


12,203



4.6
%


7,692



4.7
%Total fixed-income


200,681



73.8
%


107,334



64.6
%Cash and cash equivalents


64,890



23.9
%


46,039



27.8
%Equity securities  common shares


3,054



1.1
%


11,376



6.9
%Equity securities  preferred shares


1,037



0.4
%






0.0
%Other investment


2,241



0.8
%


1,088



0.7
%Total

$
271,903



100.0
%

$
165,837



100.0
%  15




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##### 



Treasury and Government Agency


7.5
%AAA


65.3
%AA


15.1
%A


8.0
%BBB


3.9
%BB


0.1
%CCC


0.1
%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.            Form 10-K.
  Reinsurance
   16




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##### 



GrossReinsurer

A.M. Best Rating

Amount Due(Dollars in thousands)General Reinsurance Corporation

A++ (Superior)

$
16,864National Workers Compensation Reinsurance Pool

N/A(1)


14,591Swiss Reinsurance American Corporation

A+ (Superior)


8,583MCCA

N/A(1)


5,379Platinum Reinsurance Company

A (Excellent)


4,779TOA Reinsurance Company of America

A (Excellent)


4,682National Flood Insurance Program

N/A(1)


1,486Folksamerica Reinsurance Company

A- (Excellent)


1,480Munich Reinsurance America, Inc.

A+ (Superior)


1,220Lloyds Syndicate Number 4472

N/A(1)


1,043All Other

B++ or better


4,141Total



$
64,248     (1)
    
    These reinsurers do not receive A.M. Best ratings.         17




---



##### 



case-by-case
    Ratings
      Competition
   18




---



##### 



and/or
  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 writing admitted business;
    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
   19




---



##### 



Capital Constraints Form 10-K.
  Insolvency
    Funds and Associations, Mandatory Pools and Insurance
    Facilities
        and/or
      and/or
 20




---



##### 



IRIS
    Ratios
   21




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##### 



North PointeRatio

Usual Range

Insurance RatioChange in net premiums written

+33% to −33%


41.0
%Gross change in policyholders surplus

+50% to −10%


(23.0
)%Net change in policyholders surplus

+25% to −33%


(23.0
)%         North PointeRatio

Usual Range

Casualty RatioChange in net premiums written

+33% to −33%


50
%       Captive
    Insurance Company Regulation
  and/or
   22




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##### 



Item 1A.
    RISK
    FACTORS  Risks
    Relating to the Pending Transaction with QBE
    Holdings
          
    We may be required to pay and reimburse QBE Holdings amounts of
    up to approximately $4 million in the aggregate if the
    agreement and plan of merger is terminated under certain
    circumstances;
    The current market price of our common stock may reflect a
    market assumption that the transaction will occur, and a failure
    to complete the transaction could result in a decline in the
    market price of our common stock;
    Many costs relating to the transaction (such as legal,
    accounting, and a portion of our financial advisory fees) are
    payable by North Pointe whether or not the transaction is
    completed;
    There may be substantial disruption to our business and a
    distraction of our management and employees from day-to-day
    operations because matters related to the transaction may
    require substantial commitments of time and resources, which
    could otherwise have been devoted to other opportunities that
    could have been beneficial; and
    We will continue to face the risks that we currently face as an
    independent company, as further described herein.    Our
    potential inability to integrate acquired operations could have
    a negative effect on our expenses and results of
    operations.
     23




---



##### 



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.      Changes
    in regulation could adversely affect our business.
    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.
   24




---



##### 



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.
    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. 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 most 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.  class-action
 25




---



##### 



Our
    financial results may be adversely affected by conditions in the
    states where our business is concentrated.
    Our
    results and financial condition may be adversely affected by our
    failure to establish adequate loss and loss adjustment expense
    reserves.
  Form 10-K.
  A
    reduction in our insurance company subsidiaries
    A.M. Best financial strength ratings could adversely affect
    our business and financial condition.
   26




---



##### 



We
    could incur significant losses or a shortage of liquidity if our
    reinsurers are unable to pay or do not pay our claims
    timely.
      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.
     27




---



##### 



Our
    failure to pay claims accurately could adversely affect our
    business, results of operations and capital.
    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.      Assessments
    and other surcharges for guaranty funds and mandatory
    reinsurance arrangements may reduce our
    profitability.
   28




---



##### 



Membership in Insolvency Funds and
    Associations; Mandatory Pools and Insurance Entities Form 10-K.
  Severe
    weather conditions and other catastrophes may result in an
    increase in the number and amount of claims that we
    incur.
      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.
   29




---



##### 



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




---



##### 



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.
   31




---



##### 



The
    outcome of current industry investigations and regulatory
    proposals could adversely affect our financial condition and
    results of operations.
    We may
    be subject to risks associated with our continued use of
    contingent commission arrangements with independent
    agents.
      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.
  and/or
 32




---



##### 



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.
  Form 10-K.
  Employees
    Available
    Information
  www.sec.gov 1-800-SEC-0330.
  Form 10-K, Form 10-Q, Form 8-K, http://www.npte.com/ (248) 358-1171.
  Item 1B.
    UNRESOLVED
    STAFF COMMENTS    Item 2.
    PROPERTIES.     33




---



##### 



Item 3.
    LEGAL
    PROCEEDINGS.    Item 4.
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS.   PART II  Item 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER
    MATTERS, AND ISSUER PURCHASES OF EQUITY
    SECURITIES.      2007


2006Quarter Ended

High


Low


High


LowMarch 31

$
12.94


$
9.94


$
15.83


$
11.00June 30


12.34



9.87



13.55



6.73September 30


12.05



9.00



9.51



6.33December 31


11.50



9.50



10.81



8.90    34




---



##### 



Rule 10b5-1
  TotalNumber of


Approximate DollarShares Purchased


Value of SharesTotal Number





as part of Publicly


That May Yet beof Shares


Price Paid


Announced


Purchased UnderDate

Repurchased


per Share


Program


the ProgramJune 30, 2007


200,000


$
10.16



200,000


$
2,968,000August 23, 2007


879



9.45



879



2,959,692August 24, 2007


879



9.50



879



2,951,341August 27, 2007


1,000



9.70



1,000



2,941,643August 28, 2007


1,600



9.97



1,600



2,925,691August 29, 2007


1,600



10.01



1,600



2,909,675August 31, 2007


600



10.15



600



2,903,585September 6, 2007


2,800



10.26



2,800



2,874,857  35




---



##### 



Item 6.
    SELECTED
    FINANCIAL DATA.      Form 10-K.
  North
    Pointe Holdings Corporation
    Five Year Selected Financial Data
  As of and for the Years Ended December 31,2007


2006


2005


2004


2003(Dollars in thousands, except per share and ratio data)Statements of Operations Data:Revenues:Direct premiums written

$
115,666


$
90,175


$
110,409


$
94,548


$
88,036Assumed premiums written


3,658



10



613



1,913



167Gross premiums written


119,324



90,185



111,022



96,461



88,203Net premiums written


107,408



61,127



86,079



80,493



76,224Net premiums earned

$
94,179


$
66,651


$
84,709


$
76,957


$
68,740Investment income, net of investment expenses


8,676



5,731



3,865



2,377



2,174Net realized capital gains (losses)


3,320



(214
)


(168
)


886



1,264Other income


6,649



1,369



1,901



2,222



2,047Gains on sales of businesses(1)














4,285



200Total revenues


112,824



73,537



90,307



86,727



74,425Expenses:Loss and loss adjustment expenses, net


53,548



30,874



43,971



41,503



33,141Policy acquisition costs


21,663



19,036



21,776



18,687



17,409Other underwriting and operating expenses


27,981



21,781



17,812



13,730



13,159Interest expense


3,261



1,711



959



763



422Total expenses


106,453



73,402



84,518



74,683



64,131Income from continuing operations before federal income tax
    expense and extraordinary items


6,371



135



5,789



12,044



10,294Federal income tax expense


1,755



10



1,997



3,516



3,725Income from continuing operations before extraordinary items


4,616



125



3,792



8,528



6,569Extraordinary items(2)














2,905



Income from continuing operations


4,616



125



3,792



11,433



6,569Discontinued operations (Note 3)
    Income from operations of discontinued subsidiary


8,632



6,891



88







Federal income tax expense


2,923



2,340



30







Income from discontinued operations


5,709



4,551



58







Net income

$
10,325


$
4,676


$
3,850


$
11,433


$
6,569 36




---



##### 



As of and for the Years Ended December 31,2007


2006


2005


2004


2003(Dollars in thousands, except per share and ratio data)Earnings Per Share Data:BasicIncome from continuing operations before extraordinary items and
    discontinued operations

$
0.51


$
0.01


$
0.63


$
1.50


$
1.16Income from discontinued operations


0.63



0.50



0.01



0.57



Net income


1.14



0.51



0.64



2.07



1.16DilutedIncome from continuing operations before extraordinary items

$
0.51


$
0.01


$
0.63


$
1.46


$
0.90Income from discontinued operations


0.63



0.50



0.01



0.49



Net income


1.14



0.51



0.64



1.95



0.90Balance Sheet Data:Cash and investments

$
271,903


$
165,837


$
142,691


$
115,026


$
98,115Assets of discontinued operations


14,276















Total assets


431,067



257,577



275,036



205,079



165,433Losses and loss adjustment expenses


172,264



89,755



117,778



96,561



76,319Debt


54,287



23,131



5,026



20,062



10,848Liabilities of discontinued operations


8,285















Total liabilities


332,813



169,342



192,809



170,387



137,340Redeemable preferred stock


















2,000Shareholders equity


98,254



88,235



82,227



34,692



26,093Combined statutory capital and surplus(3)


100,502



91,009



69,736



47,900



29,706Book value per share(4)

$
11.02


$
9.67


$
9.02


$
7.10


$
5.01Key Financial Ratios:Loss ratio(5)


53.1
%


45.4
%


50.8
%


52.4
%


46.8
%Expense ratio(6)


49.2
%


60.0
%


45.7
%


41.0
%


43.2
%Combined ratio(7)


102.3
%


105.4
%


96.5
%


93.4
%


90.0
%     (1)
    
    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.(2)
    
    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.(3)
    
    In 2007, North Pointe Insurance, North Pointe Casualty, Capital
    City Insurance and Midfield contributed $5.0 million,
    $1.0 million, $3.0 million and $3.0 million,
    respectively, to their parent. These contributions were made to
    facilitate the Capital City acquisition and to pay down
    outstanding debt. As of December 31, 2007, combined
    statutory capital and surplus included $36.1 million for
    Capital City Insurance which was acquired in July 2007 but did
    not include the capital and surplus of Home Pointe Insurance
    which was classified as discontinued operations for the year.In 2006, we contributed a total of $9.0 million to our
    insurance company subsidiaries. $5.0 million was
    contributed to North Pointe Casualty and $4.0 million was
    contributed to Home Pointe Insurance.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 37




---



##### 



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.(4)
    
    Book value per share equals the quotient obtained by dividing
    shareholders equity by the number of shares of common
    stock outstanding.(5)
    
    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.(6)
    
    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.(7)
    
    Combined ratio is the sum of the loss ratio and the expense
    ratio.  Item 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATION.  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
    
    the availability and pricing of reinsurance and the potential
    for non-payment or delay in payment by reinsurers;
    our ability to accurately price the risks we underwrite;
    the impact of the current credit crisis on our investment
    portfolio, level of investment income, and level of impairment;
    the inability to successfully integrate the Capital City
    entities could have a negative effect on our expenses and
    results of operations;
    the establishment of adequate loss and loss adjustment expense
    reserves;
    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;
    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; 38




---



##### 




    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 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;
    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; 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.  Form 10-K
  Overview
         39




---



##### 



30-year,
  Critical
    Accounting Estimates
   40




---



##### 



Estimation
    of Unpaid Loss and Loss Adjustment Expense
    Reserves
          Form 10-K.
  Federal
    Income Tax Expense
    Accounting
    for Income Taxes (SFAS 109)
  Other-Than-Temporary
    Impairment of Investments
   41




---



##### 



Form 10-K.
  Fair
    Value of Net Assets Acquired
  Form 10-K.
  Reinsurance
    Recoverables
   42




---



##### 



Results
    of Operations
  Unless
    otherwise noted, the following discussion relates only to
    results from continuing operations.
    North Pointe Holdings CorporationYears Ended December 31,2007


2006


2005(Dollars in thousands, except ratio data)Gross premiums written:Commercial lines

$
108,480


$
81,901


$
78,551Personal lines


10,844



8,284



32,471Total gross premiums written

$
119,324


$
90,185


$
111,022Net premiums written:Commercial lines

$
96,808


$
56,140


$
63,289Personal lines


10,600



4,987



22,790Total net premiums written

$
107,408


$
61,127


$
86,079Revenues:Net premiums earned:Commercial lines

$
88,431


$
59,456


$
61,066Personal lines


5,748



7,195



23,643Total net premiums earned


94,179



66,651



84,709Investment income, net


8,676



5,731



3,865Net realized capital gains (losses)


3,320



(214
)


(168
)Fees and other income


6,649



1,369



1,901Total revenues


112,824



73,537



90,307Expenses:Losses and loss adjustment expenses, net


53,548



30,874



43,971Policy acquisition costs


21,663



19,036



21,776Other underwriting and operating expenses


27,981



21,781



17,812Interest expenses


3,261



1,711



959Total expenses


106,453



73,402



84,518Income before federal income tax expense and discontinued
    operations


6,371



135



5,789Federal income tax expense


1,755



10



1,997Income from continuing operations


4,616



125



3,792Net income from discontinued operations


5,709



4,551



58Net income

$
10,325


$
4,676


$
3,850Loss ratio:Commercial lines


58.1
%


39.9
%


47.8
%Personal lines


37.7



99.0



62.5Consolidated


53.1



45.4



50.8Expense ratio


49.2



60.0



45.7Combined ratio


102.3



105.4



96.5  43




---



##### 



Gross
    Premiums Written
    Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
      Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
        Net
    Premiums Written
   44




---



##### 



Form 10-K.
  Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
  Net
    Premiums Earned
    Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
    Year Ended December 31,2007


2006


2005(Dollars in thousands)Gross premiums earned:Commercial lines

$
103,743


$
85,043


$
75,684Personal lines


6,043



10,609



33,967Total


109,786



95,652



109,651Ceded premiums earned:Commercial lines


15,312



25,587



14,618Personal lines


295



3,414



10,324Total


15,607



29,001



24,942Net premiums earned:Commercial lines


88,431



59,456



61,066Personal lines


5,748



7,195



23,643Total

$
94,179


$
66,651


$
84,709  45




---



##### 



Net
    Investment Income
    Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
  Net
    Realized Gains (Losses) on Investments
    Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
  Fees
    and Other Income
    Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
 46




---



##### 



Losses
    and Loss Adjustment Expenses
    Form 10-K.
  Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
      Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
     47




---



##### 



2007


2006


2005Commercial lines loss ratios before effects of hurricane losses
    and reserve development


53.2
%


47.7
%


44.0
%Increase (decrease) in loss ratios attributable to reserve
    development


4.9



(6.6
)


(5.7
)(Decrease) increase in loss ratios attributable to hurricane
    losses






(1.2
)


9.5Total commercial lines loss ratios


58.1
%


39.9
%


47.8
%             2007


2006


2005Personal lines loss ratios before effects of hurricane losses
    and reserve development


71.0
%


80.1
%


39.2
%(Decrease) increase in loss ratios attributable to reserve
    development


(17.5
)


20.5



(8.3
)(Decrease) increase in loss ratios attributable to hurricane
    losses


(15.6
)


(1.6
)


31.6Total personal lines loss ratios


37.7
%


99.0
%


62.5
%    48




---



##### 



Policy
    Acquisition Costs
    Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
  Other
    Underwriting and Operating Expenses
    Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
  Interest
    Expense
  Year Ended December 31, 2007 as Compared to Year Ended
    December 31, 2006.
  Year Ended December 31, 2006 as Compared to Year Ended
    December 31, 2005.
  Federal
    Income Tax Expense
  Year Ended December 31, 2007.
  Year Ended December 31, 2006.
 49




---



##### 



Net OperatingLossesCarried


Year

Year ofForward


Originated

Expiration(Dollars in thousands)$
163


1997


2011472


1999


20181,393


2000


20193,693


2001


2020$
5,721   Liquidity
    and Capital Resources
  Sources
    and Uses of Funds
   Capital
    Constraints
       50




---



##### 



Cash
    Flows
           51




---



##### 



12-month Form 10-K.
  Capital
    Constraints
  Writings to Surplus Ratios:
    Risk Based Capital:
  Regulations on Dividends Paid by Insurance
    Companies:
   52




---



##### 




    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
   53




---



##### 




    adjusted capital and surplus will be in excess of 275% of
    authorized control level risk-based capital as of each fiscal
    year end;
    there shall be no more than four IRIS calculations that result
    in unusual values at each fiscal year end;
    the ratio of net premiums written to statutory capital and
    surplus will not exceed more than 4.0 to 1.0 in the case of
    North Pointe Casualty Insurance Company, 2.5 to 1.0 in the case
    of North Pointe Insurance Company; and 2.5 to 1.0 in the case of
    Capital City Insurance Company; and
    the ratio of gross premiums written to statutory surplus will
    not exceed more than 10.0 to 1.0 in the case of North Pointe
    Casualty Insurance Company, 3.0 to 1.0 in the case of North
    Pointe Insurance Company and 3.0 to 1.0 in the case of Capital
    City Insurance Company.    Mortgage Obligation.
  Issuance
    of Trust Preferred Securities
  30-year,
     54




---



##### 




    9.62% $2,000,000 Trust preferred securities (Capital City
    Insurance Company, S.C. Statutory
    Trust I)  These debentures mature in
    December 2032. These debentures are redeemable at par at the
    option of the Company, in whole or in part, on any interest
    payment date on or after December 4, 2007.
    9.66% $6,000,000 Trust preferred securities (Capital City
    Insurance Company, S.C. Statutory Trust II) These debentures mature in May 2033.
    These debentures are redeemable at par at the option of the
    Company, in whole or in part, on any interest payment date on or
    after May 15, 2008.
    9.49% $2,000,000 Trust preferred securities (Capital City
    Insurance Company, S.C. Statutory
    Trust III) These debentures mature
    in June 2034. These debentures are redeemable at par at the
    option of the Company, in whole or in part, on any interest
    payment date on or after June 17, 2009.  Contractual
    Obligations and Commitments
    2012 and2008


2009


2010


2011


Thereafter


Total(Dollars in thousands)Junior subordinated debt

$
2,691


$
2,755


$
2,755


$
2,755


$
95,694


$
106,650Senior credit facility


1,563



1,563



22,061











25,187Mortgage obligation


267



267



267



267



1,765



2,833Operating leases


1,736



1,423



650



151



33



3,993Unpaid loss and losses adjustment expense


65,116



37,726



24,806



14,987



29,629



172,264Commitment to purchase other investments


759



















759Guaranteed employee salary and bonuses


747



















747FIN 48 liability


1,774



58















1,832Total

$
74,653


$
43,792


$
50,539


$
18,160


$
127,121


$
314,265    55




---



##### 



Effects
    of New Accounting Pronouncements
  Fair Value
    Measurements,
  The
    Fair Value Option for Financial Assets and Financial
    Liabilities
  Accounting for Income Taxes.
  Item 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.    Interest
    Rate Risk
   56




---



##### 



Hypothetical PercentageEstimated


Increase (Decrease) inHypothetical Change in Interest Rates

Estimated


Change in





ShareholdersAs of December 31, 2007

Fair Value


Fair Value


Fair Value


Equity(Dollars in thousands)200 basis point increase

$
184,726


$
(15,955
)


(8.0
)%


(10.6
)%100 basis point increase


192,787



(7,894
)


(3.9
)%


(5.3
)%No change


200,681







0.0
%


0.0
%100 basis point decrease


208,305



7,624



3.8
%


5.1
%200 basis point decrease


215,660



14,979



7.5
%


10.0
%   Credit
    Risk
          Effects
    of Inflation
    Item 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA.   57




---



##### 



North
    Pointe Holdings Corporation
  Unaudited
    Consolidated Quarterly Results of Operations
      Quarters EndedDecember 31,


September 30,


June 30,


March 31,


December 31,


September 30,


June 30,


March 31,2007


2007


2007


2007


2006


2006


2006


2006(Unaudited)(Dollars in thousands, except per share and ratio data)Statement of Operations Data:Revenues:Gross premiums written

$
39,189


$
34,099


$
21,734


$
20,644


$
22,584


$
21,859


$
19,992


$
25,740Net premiums written

$
35,964


$
31,116


$
19,693


$
20,635


$
17,456


$
10,038


$
14,830


$
18,713Net premiums earned

$
28,797


$
31,106


$
17,611


$
16,665


$
15,072


$
16,157


$
17,789


$
17,633Investment income, net


2,767



2,551



1,523



1,835



1,593



1,527



1,451



1,160Net realized capital gains (losses)


2,545



281



246



248



36



85



27



(362
)Fees and other income


2,806



2,954



607



282



456



268



304



341Total revenues


36,915



36,892



19,987



19,030



17,157



18,037



19,571



18,772Expenses:Losses and loss adjustment expenses, net


17,884



17,448



9,754



8,462



6,429



6,065



9,895



8,485Policy acquisition costs


1,574



9,456



5,396



5,237



4,340



4,647



4,875



5,174Other underwriting and operating expenses


12,707



6,416



4,517



4,341



6,903



5,451



5,855



3,572Interest expense


1,226



1,048



501



486



502



498



462



249Total expenses


33,391



34,368



20,168



18,526



18,174



16,661



21,087



17,480Income (loss) before discontinued operations and federal income
    tax expense (benefit)


3,524



2,524



(181
)


504



(1,017
)


1,376



(1,516
)


1,292Federal income tax expense (benefit)


1,175



626



(204
)


158



(375
)


428



(491
)


448Income from continuing operations


2,349



1,898



23



346



(642
)


948



(1,025
)


844Net income from discontinued operations


1,504



909



2,300



996



1,056



1,216



1,496



783Net income

$
3,853


$
2,807


$
2,323


$
1,342


$
414


$
2,164


$
471


$
1,627Earnings Per Share Data:BasicIncome from continuing operations(1)


0.26



0.21



(0.00
)


0.04



(0.07
)


0.10



(0.11
)


0.09Income from discontinued operations(1)


0.17



0.10



0.25



0.11



0.12



0.13



0.16



0.09DilutedIncome from continuing operations(1)


0.26



0.21



(0.00
)


0.04



(0.07
)


0.10



(0.11
)


0.09Income from discontinued operations(1)


0.17



0.10



0.25



0.11



0.12



0.13



0.16



0.09Key Financial Ratios:Loss ratio


56.6
%


51.2
%


53.5
%


49.9
%


41.4
%


36.9
%


54.7
%


47.2
%Expense ratio


45.2
%


46.6
%


54.4
%


56.5
%


72.4
%


61.5
%


59.3
%


48.7
%Combined ratio


101.8
%


97.8
%


108.0
%


106.4
%


113.8
%


98.4
%


114.0
%


95.9
%  58




---



##### 



(1)
    
    Earnings per share are computed independently for each quarter
    and the full year based upon respective average shares
    outstanding. Therefore, the sum of the quarterly earnings per
    share amounts may not equal the annual amounts reported.  Item 9.
    CHANGE
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE.    Item 9A.
    CONTROLS
    AND PROCEDURES.  Evaluation
    of Disclosure Controls and Procedures
  Rule 13a-15(e)
    Changes
    in Internal Controls over Financial Reporting
    Managements
    Report on Internal Control over Financial
    Reporting
  Rule 13a-15(f)
    Item 9B.
    OTHER
    INFORMATION.   59




---



##### 



Item 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.  DIRECTORS
    AND EXECUTIVE OFFICERS
    Name

Age

Title

Term EndingJoon S. Moon

70

Director


2010B. Matthew Petcoff

47

Chief Operating Officer, Executive Vice President, Secretary and
    Director


2010Joseph D. Sarafa

53

Director


2010Richard J. Lindberg

58

Director


2008Jorge J. Morales

53

Director


2008James G. Petcoff

52

Chief Executive Officer, President and Chairman of the Board


2008Julius A. Otten

68

Director


2009R. Jamison Williams, Jr.

66

Director


2009John H. Berry

65

TreasurerPaul B. Deemer

33

Vice President and Chief ActuaryBradford T. Lyons

56

Senior Vice President  UnderwritingL. Matthew MacLean

37

Senior Vice President  ClaimsBrian J. Roney

43

Chief Financial Officer and Senior Vice
    President  Finance   Dr. Joon S. Moon
  B. Matthew Petcoff
  Joseph D. Sarafa
 60




---



##### 



Richard J. Lindberg
  Jorge J. Morales
  James G. Petcoff
  Julius A. Otten, CPA
  R. Jamison Williams, Jr.
  John H. Berry, CPA
 61




---



##### 



Paul B. Deemer
  Bradford T. Lyons
  L. Matthew MacLean
  Brian J. Roney
  CORPORATE
    GOVERNANCE
  www.npte.com
     62




---



##### 



AUDIT
    COMMITTEE
    Item 11.
    EXECUTIVE
    COMPENSATION.  Overview
    of Compensation Philosophy and Program
      General
    Compensation Philosophy
    
    Base salaries;
    Annual cash incentive awards;
    Long-term, equity-based incentive compensation, primarily in the
    form of stock options; and
    Certain other benefits.      
    Employment Agreements for CEO, James G. Petcoff, Chief Operating
    Officer (COO), B. Matthew Petcoff, and Chief
    Financial Officer (CFO), Brian J. Roney.
    Annual Incentive Compensation Plan for NEO and other key
    employees.
    Equity Incentive Plan for NEO, non-employee directors and other
    key employees.   63




---



##### 



Compensation
    Tally Sheets
  change-in-control
  Base
    Salaries
    Employment
    Agreements with Executive Officers
       64




---



##### 



Change-in-Control-Employment
    Evaluation
    of CEO/CFO and NEO Performance in 2007
      
    The Companys return on equity;
    Development, communication to shareholders and employees, and
    implementation of a financial plan that is designed to increase
    shareholder value;
    Development and training of divisional managers and staff;
    Evaluation and implementation of strategic acquisitions.     65




---



##### 



Annual
    Incentive Compensation Plan
    Awards
           66




---



##### 



Chief Executive

Chief OperatingReturn on Equity

Officer

Officer

Vice Presidents<5%

No Bonus

No Bonus

No Bonus5.01% - 6.0%

10% of Salary

10%

5%6.01% - 7.0%

20% of Salary

20%

10%7.01% - 8.0%

30% of Salary

30%

15%8.01% - 9.0%

40% of Salary

35%

20%9.01% - 10.0%

50% of Salary

40%

25%10.01% - 11.0%

60% of Salary

45%

30%11.01% - 12.0%

70% of Salary

50%

35%12.01% - 13.0%

80% of Salary

55%

40%13.01% - 14.0%

90% of Salary

60%

45%14.01% - 15.0%

100% of Salary

65%

50%15.01% - 16.0%

110% of Salary

70%

55%16.01% - 17.0%

120% of Salary

75%

60%17.01% - 18.0%

130% of Salary

80%

65%18.01% - 19.0%

140% of Salary

85%

70%19.01% - 20.0%

150% of Salary

90%

75%     (1)
    
    Return on consolidated equity, calculated as consolidated net
    income after bonus pool accrual divided by prior year-end
    consolidated net worth.(2)
    
    Bonus pool accrual increases by 10% of salary for each
    percentage point of return on equity over 20%.  Long-Term
    Incentive Compensation
      Shares Reserved
    Limitations
    on Awards
  and/or
  Administration
   67




---



##### 



Eligibility
      Restricted
    Stock Awards to Key Employees
    Performance
    Shares
    Stock
    Options
     68




---



##### 



OTHER
    BENEFITS
  Perquisites
    Severance
    Payments
  Change-in-Control
  Employment Agreements.
  Change of Control Provisions.
      COMPENSATION
    COMMITTEE REPORT
    The
    Compensation Committee:
     69




---



##### 



SUMMARY
    COMPENSATION TABLE
    Change inPension ValueandNon-Equity


NonqualifiedStock


Option


Incentive Plan


Deferred


All OtherSalary


Bonus


Awards


Awards


Compensation


Compensation


Compensation


TotalName and Principal Position

Year


($)(a)


($)(b)


($)


($)(c)


($)


Earnings ($)


($)(d)


($)(e)James G. Petcoff,


2007


$
855,800


$
670,240






















$
1,526,040CEO, President, Chairman of the BoardBrian J. Roney,


2007


$
229,000


$
88,000






$
122,400














$
439,400CFOB. Matthew Petcoff,


2007


$
433,200


$
228,360






$
122,400














$
783,960COO, Executive Vice President, Secretary, DirectorBradford T. Lyons,


2007


$
247,750


$
91,900






$
122,400














$
462,050Senior Vice PresidentL. Matthew MacLean,


2007


$
232,000


$
88,000






$
122,400














$
442,400Senior Vice President       (a)
    
    The dollar value of base salary earned during the fiscal year.(b)
    
    The dollar value of bonus earned during the fiscal year.(c)
    
    The aggregate grant date fair value of option awards (with or
    without tandem SARs) computed in accordance with
    FAS 123(R). On September 12, 2007, certain employees
    were granted options to purchase shares of the Companys
    common stock for $10.86 per share, subject to vesting. The
    options become exercisable in equal 20% installments on each
    anniversary of the grant date, commencing with the first
    anniversary thereof. The options expire on the tenth anniversary
    of the grant date or 90 days following termination of
    employment, whichever occurs first. The fair value of the stock
    options was estimated at the date of grant using the
    Black-Scholes option pricing model and employing the following
    assumptions:  Fair Value of underlying common stock:

$10.86/shareWeighted average life of options:

6.5 yearsRisk-free interest rate:

4.11%Dividend yield:

0.00%Weighted average volatility assumption:

27.60%   (d)
    
    All other compensation, including perquisites.(e)
    
    The dollar value of total compensation for the year, equal to
    the sum of columns (a) through (d). 70




---



##### 



GRANTS OF
    PLAN-BASED AWARDS
    All


All OtherOther


Option


ExerciseEstimated








Estimated








Stock


Awards:


or BaseUnder








Future








Awards:


Number of


Price ofNon-Equity


Future





Under Equity





Payout


Number of


Securities


OptionGrant


Plan Awards


Payouts


Incentive


Awards


Incentive


Plans


Shares


Underlying


AwardsDate


Threshold


Target


Maximum


Threshold


Target


Maximum


of Stock


Options (#)


($/Sh)Name

(a)


($)


($)


($)


(#)


(#)


(#)


or Units


(b)


(c)James G. Petcoff,


09/12/07



































CEO, President, Chairman of the BoardBrian J. Roney,


09/12/07































30,000



10.86CFOB. Matthew Petcoff,


09/12/07































30,000



10.86COO,
    Executive Vice President, Secretary,
    DirectorBradford T. Lyons,


09/12/07































30,000



10.86Senior Vice PresidentL. Matthew MacLean,


09/12/07































30,000



10.86Senior Vice President       (a)
    
    The grant date for equity-based option awards.(b)
    
    The number of shares underlying options granted in the fiscal
    year.(c)
    
    The per-share exercise or base price of the options granted in
    the fiscal year. 71




---



##### 



OUTSTANDING
    EQUITY AWARDS AT FISCAL YEAR-END
    Option Awards


Stock AwardsEquityIncentivePlanAwards:Number of





Equity














Equity Incentive


Market orSecurities


Number of


Incentive Plan











Market Value


Plan Awards:


Payout ValueUnderlying


Securities


Awards Number








Number of


of Shares or


Number of


of UnearnedUnexercised


Underlying


of Securities








Shares or Units


Units or Other


Unearned


Shares, UnitsOptions


Unexercised


Underlying


Option


Option


of Stock That


Rights That


Shares, Units or


or Other(#)


Options (It)


Unexercised


Exercise


Expiration


Have Not


Have Not


Other Rights That


Rights ThatExercisable


Unexercisable


Unearned


Price


Date


Vested (#)


Vested


Have Not


Have NotName

(a)


(b)


Options (II)


($)(c)


(d)


(e)


(f)


Vested (II)


Vested ($)James G. Petcoff,


40,000



60,000







12.00



9/28/15















CEO, President, Chairman of the BoardJames G. Petcoff,


4,000



16,000







10.50



11/27/16















CEO, President,
    Chairman of the
    BoardBrian J. Roney,


10,000



15,000







12.00



9/28/15















CFOBrian J. Roney,


1,000



4,000







10.50



11/27/16















CFOBrian J. Roney,






30,000







10.86



09/12/07















CFOB. Matthew Petcoff,


20,000



30,000







12.00



9/28/15















COO, Executive Vice President,
    Secretary, DirectorB. Matthew Petcoff,


2,000



8,000







10.50



11/27/16















COO, Executive Vice President,
    Secretary, DirectorB. Matthew Petcoff,






30,000







10.86



09/12/07















COO, Executive Vice President,
    Secretary, DirectorBradford T. Lyons,


14,000



21,000







12.00



9/28/15















Senior Vice PresidentBradford T. Lyons,


1,400



5,600







10.50



11/27/16















Senior Vice PresidentBradford T. Lyons,






30,000







10.86



09/12/07















Senior Vice PresidentL. Matthew MacLean,


12,000



18,000







12.00



9/28/15



1,500


$
16,500







Senior Vice PresidentL. Matthew MacLean,


1,200



4,800







10.50



11/27/16















Senior
    Vice PresidentL. Matthew MacLean,






30,000







10.86



09/12/07















Senior Vice President       (a)
    
    On an
    award-by-award
    basis, the number of shares underlying unexercised options that
    are exercisable.(b)
    
    On an
    award-by-award
    basis, the number of shares underlying unexercised options that
    are unexercisable.(c)
    
    For each instrument reported in columns (a) and (b), the
    exercise price.(d)
    
    For each instrument reported in columns (b) (c) and (d), as
    applicable, the expiration date.(e)
    
    The total number of shares of stock that have not vested and
    that are not reported.(f)
    
    The aggregate market value of shares of stock that have not
    vested and that are not reported in column. 72




---



##### 



OPTION
    EXERCISES AND STOCK VESTED
    Option Awards


Stock AwardsNumber of





Number ofShares Acquired


Value Realized


Shares Acquired


Value Realizedon Exercise


on Exercise


on Vesting


on VestingName

(#)


($)


(#)(a)


($)(b)James G. Petcoff,


0











CEO, President, Chairman of the BoardBrian J. Roney,


0











CFOB. Matthew


0











Petcoff, COO, Executive Vice President,
    Secretary, DirectorBradford T. Lyons,


0











Senior Vice PresidentL. Matthew MacLean,


0







500


$
5,430Senior Vice President       (a)
    
    The number of shares of stock that have vested.(b)
    
    The aggregate dollar value realized upon vesting of stock (i.e.,
    the number of shares times the market price of the underlying
    shares on the vesting date), or upon the transfer of an award
    for value.  PENSION
    BENEFITS
    Number of Years


Present Value of


Payments DuringCredited Service


Accumulated


Last Fiscal YearName

Plan Name


(#)


Benefit ($)


($)James G. Petcoff,


N/A



N/A



N/A



N/ACEO, President, Chairman of the BoardBrian J. Roney,


N/A



N/A



N/A



N/ACFOB. Matthew Petcoff,


N/A



N/A



N/A



N/ACOO, Executive Vice President,
    Secretary, DirectorBradford T. Lyons,


N/A



N/A



N/A



N/ASenior Vice PresidentL. Matthew MacLean,


N/A



N/A



N/A



N/ASenior Vice President  73




---



##### 



NON-QUALIFIED
    DEFERRED COMPENSATION
    Executive


Registrant


Aggregate


Aggregate


AggregateContributions


Contributions in


Earnings


Withdrawals/


Balance atName

in Last FY ($)


Last FY ($)


in Last FY ($)


Distributions ($)


Last FYE ($)James G. Petcoff,


N/A



N/A



N/A



N/A



N/ACEO, President, Chairman of the BoardBrian J. Roney,


N/A



N/A



N/A



N/A



N/ACFOB. Matthew Petcoff,


N/A



N/A



N/A



N/A



N/ACOO, Executive Vice President,
    Secretary, DirectorBradford T. Lyons,


N/A



N/A



N/A



N/A



N/ASenior Vice PresidentL. Matthew MacLean,


N/A



N/A



N/A



N/A



N/ASenior Vice President   DIRECTOR
    COMPENSATION
      Change inPensionFees











Value andEarned








Non-Equity


Non-qualifiedor Paid


Stock


Option


Incentive Plan


Deferred


All Otherin Cash


Awards


Awards


Compensation


Compensation


Compensation


TotalName

($)(a)


($)(1)(b)


($)


($)


Earnings ($)


($)(c)


($)(d)Richard J. Lindberg

$
35,000


$
11,110


















$
46,110Joon S. Moon

$
34,000


$
11,110














$
16,620


$
61,720Jorge J. Morales

$
27,500


$
11,110


















$
38,610R. Jamison Williams, Jr.

$
28,000


$
11,110














$
30


$
39,140Julius A. Otten

$
65,000


$
11,110


















$
76,110Joseph D. Sarafa

$
27,000


$
11,110














$
1,287


$
39,397       (a)
    
    The aggregate dollar amount of all fees earned or paid in cash
    for services as a director, including annual retainer fees,
    committee and/or chairmanship fees, and meeting fees.(b)
    
    For awards of stock, the aggregate grant date fair value
    computed in accordance with FAS 123(R). See
    footnote (1).(c)
    
    All other compensation for the covered fiscal year that could
    not properly be reported in any other column. All other
    compensation includes consulting fees and expenses.(d)
    
    The dollar value of total compensation for the covered fiscal
    year, equal to the sum of all amounts reported in columns
    (a) though (c).   74




---



##### 



Potential
    Payments Upon Termination or
    Change-in-Control
        Company
    Share-Based Plans
  Equity
    Incentive Plan
    Change of Control Provisions.
   75




---



##### 



Employment
    Agreements
        Change of Control Provisions. 24-month
  24-month
  
    his base salary for the period until the end of the full
    employment term; or
    three times the sum of (i) the executives annual base
    salary in effect on the date of termination, plus
    (ii) one-half of the cash bonus paid or due to the
    executive for the last fiscal year prior to the date of
    termination.       76




---



##### 



Change of
    Control/Severance Payment Table
    Named
    Executive Officers
  Life


AnnualMiscellaneous


Share-Based


Insurance


DisabilityCash Severance


Benefits


Awards


Proceeds


BenefitsJames G. Petcoff(1)Death

$
3,212,346






$
3,081


$
100,000



Disability


3,116,346







3,081






$
96,000Termination without cause


2,486,250







3,081







Change of control


2,486,250
(2)






3,081







Brian J. Roney(1)Death










4,970



100,000



Disability










4,970







96,000Change of control


440,000







4,970







B. Matthew Petcoff(1)Death


1,589,158







5,741



100,000



Disability


1,493,158







5,741







96,000Termination without cause


1,362,600







5,741







Change of control


1,362,600







5,741







Bradford T. Lyons(1)Death










700



200,000



Disability










700







96,000Change of control










700







L. Matthew MacLean(1)Death










21,800



100,000



Disability










21,800







96,000Change of control










21,800







     (1)
    
    Except as noted in the table above, such person does not receive
    any additional payments if (i) he voluntarily terminates
    his employment, (ii) retires or (iii) his employment
    is terminated by the Company with or without cause.(2)
    
    In connection with the proposed merger of the Company with a
    subsidiary of QBE Holdings, Inc., Mr. James Petcoff was
    waived the payment of this amount. See the discussion under
    Employment Agreements, above. 77




---



##### 



Item 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS.    Number ofSecuritiesRemainingAvailable forNumber of


Weighted-


Future IssuancesSecurities to be


Average


Under EquityIssued Upon


Exercise


CompensationExercise of


Price of


Plans (ExcludingOutstanding


Outstanding


SecuritiesOptions, Warrants,


Options, Warrants,


Reflected inand Rights


and Rights


Column (a))(a)


(b)


(c)Equity compensation plans approved by security holders:Equity Incentive Plan


712,500


$
11.38



179,433Equity compensation plan not approved by security holders:None


712,500


$
11.38



179,433   SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
    c/o North
  78




---



##### 



Number of


PercentDirectors, Executive Officers and 5% Shareholders(1)

Shares(1)


%(1)James G. Petcoff


2,896,640



32.0B. Matthew Petcoff


446,500



4.9John H. Berry(2)


31,225



*Bradford T. Lyons


36,625



*Brian J. Roney


180,800



2.0L. Matthew MacLean(3)


15,700



*Richard J. Lindberg


3,000



*Joon S. Moon


426,500



4.7Jorge J. Morales


3,000



*R. Jamison Williams, Jr.(4)


133,350



1.5Julius A. Otten


5,000



*Joseph D. Sarafa


42,200



*Paul B. Deemer


2,000



*Becker Capital Management, Inc.


457,253



5.1Hovde Financial, Inc.


553,581



6.1Security Equity Fund


525,000



5.8Security Global Investors, LLC


797,8000



8.8Wellington Management Company, LLP


765,382



8.5Wells Fargo & Company


1,069,859



11.8All directors, director nominees and executive officers as a
    group (13 persons)


4,222,540



46.6     *
    
    Represents less than 1%(1)
    
    The Company has relied upon information supplied by certain
    beneficial owners and upon information contained in filings with
    the SEC. Each share of Common Stock is entitled to one vote.(2)
    
    Mr. Berry holds his shares through the John H. Berry and
    Christine M. Berry Living Trust dated June 1, 2004, for
    which Mr. Berry serves as the trustee.(3)
    
    Mr. MacLean holds 2,500 shares indirectly through the
    Lawrence Matthew MacLean Living Trust dated March 20, 2000,
    for which Mr. MacLean serves as trustee.(4)
    
    Mr. R. Jamison Williams holds 132,350 shares
    indirectly through the Richard Jamison Williams, Jr. Revocable
    Trust dated December 7, 2001, for which Mr. R. Jamison
    Williams serves as trustee.  CHANGES
    IN CONTROL
    Item 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE.  RELATED
    PARTY TRANSACTIONS
   79




---



##### 



DIRECTOR
    INDEPENDENCE
    Item 14.
    PRINCIPAL
    ACCOUNTING FEES AND SERVICES.  AUDIT FEES. Form 10-Q
    TAX FEES.
  ALL OTHER FEES.
   80




---



##### 



PRE-APPROVAL POLICIES AND PROCEDURES FOR AUDIT AND NON-AUDIT
    SERVICES.
 PART IV  Item 15.
    EXHIBITS,
    FINANCIAL STATEMENT SCHEDULES.    INDEX TO
    FINANCIAL STATEMENTS
  PageNorth Pointe Holdings Corporation and Subsidiaries
    Consolidated Financial StatementsReports of Independent Registered Public Accounting Firms


82Consolidated Balance Sheets as of December 31, 2007 and 2006


84Consolidated Statements of Income for the Years Ended
    December 31, 2007, 2006, and 2005


85Consolidated Statements of Shareholders Equity and
    Comprehensive Income for the Years Ended December 31, 2007,
    2006, and 2005


86Consolidated Statements of Cash Flows for the Years Ended
    December 31, 2007, 2006, and 2005


87Notes to Consolidated Financial Statements


88Financial Statement SchedulesSchedule I  Summary of Investments 
    Other than Investments in Related Parties


121Schedule II  Condensed Financial Information of
    Registrant


122Schedule III  Supplementary Insurance Information


127Schedule IV  Reinsurance


130Schedule VI  Supplemental Information Concerning
    Property  Casualty Insurance Operations


131  81




---



##### 



Report of
    Independent Registered Public Accounting Firm              
    82




---



##### 



Report of
    Independent Registered Public Accounting Firm
  
    
  
 83




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries



Consolidated
    Balance Sheets

As of
    December 31, 2007 and 2006  2007


2006(Dollars in thousands, except share data)ASSETSInvestmentsDebt securities, available for sale, at fair value (amortized
    cost of $198,184 and $108,911 in 2007 and 2006, respectively)

$
200,681


$
107,334Common stocks, at fair value (cost of $3,335 and $9,302 in 2007
    and 2006, respectively)


3,054



11,376Preferred stock (cost of $1,000 and $0 in 2007 and 2006,
    respectively)


1,037



Other investment


2,241



1,088Total investments


207,013



119,798Cash and cash equivalents


64,890



46,039Accrued investment income


2,136



1,236Premiums and agent balances receivable, net


31,346



18,088Reinsurance recoverables onPaid losses


5,337



4,168Unpaid losses


51,141



33,321Prepaid reinsurance premiums


7,770



11,881Deferred policy acquisition costs


13,731



8,848Deferred federal income taxes, net


9,375



5,061Federal income tax recoverable


3,496



523Fixed assets, net of accumulated depreciation


5,743



5,946Prepaid expenses and other assets


3,263



2,668Goodwill


11,550



Assets of discontinued operations


14,276



Total assets

$
431,067


$
257,577LIABILITIES, REDEEMABLE PREFERRED STOCK AND
    SHAREHOLDERS EQUITYLiabilitiesUnpaid losses and loss adjustment expenses

$
172,264


$
89,755Unearned premiums


63,309



42,320Debt


54,287



23,131Amounts due to reinsurers


1,118



1,930Accrued expenses and other liabilities


24,871



7,122Premiums in advance


368



4,970Amounts withheld for others


8,311



114Liabilities of discontinued operations


8,285



Total liabilities


332,813



169,342Commitments and contingent liabilitiesShareholders equityCommon stock, no par value; 50,000,000 shares authorized;
    8,919,329 and 9,122,687issued and outstanding in 2007 and 2006, respectively


49,041



50,578Preferred stock, no par value; 5,000,000 shares authorized;
    and 0 shares issuedand outstanding in 2007 and 2006, respectively






Retained earnings


47,654



37,329Accumulated other comprehensive incomeNet unrealized gains on investments, net of deferred federal
    incometax expense of $767 and $169, respectively


1,559



328Total shareholders equity


98,254



88,235Total liabilities and shareholders equity

$
431,067


$
257,577    84




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries



Consolidated
    Statements of Income

For the
    Years Ended December 31, 2007, 2006 and 2005  2007


2006


2005(Dollars in thousands, except share data)RevenuesDirect premiums written

$
115,666


$
90,175


$
110,409Assumed premiums written


3,658



10



613Gross premiums written


119,324



90,185



111,022Premiums ceded


(11,916
)


(29,058
)


(24,943
)Net premiums written


107,408



61,127



86,079(Increase)/decrease in unearned premiums


(13,229
)


5,524



(1,370
)Net premiums earned


94,179



66,651



84,709Investment income, net of investment expenses


8,676



5,731



3,865Net realized capital gains (losses)


3,320



(214
)


(168
)Fess and other income


6,649



1,369



1,901Total revenues


112,824



73,537



90,307ExpensesLosses and loss adjustment expenses, net


53,548



30,874



43,971Policy acquisition costs


21,663



19,036



21,776Other underwriting and operating expenses


27,981



21,781



17,812Interest expense


3,261



1,711



959Total expenses


106,453



73,402



84,518Income before federal income tax expense and discontinued
    operations


6,371



135



5,789Federal income tax expense


1,755



10



1,997Income from continuing operations


4,616



125



3,792Discontinued operations (Note 3)Income from discontinued operations


8,632



6,891



88Federal income tax expense


2,923



2,340



30Income from discontinued operations


5,709



4,551



58Net income

$
10,325


$
4,676


$
3,850Earnings Per ShareBasicContinuing operations

$
0.51


$
0.01


$
0.63Discontinued operations


0.63



0.50



0.01Net income

$
1.14


$
0.51


$
0.64DilutedContinuing operations

$
0.51


$
0.01


$
0.63Discontinued operations


0.63



0.50



0.01Net income

$
1.14


$
0.51


$
0.64Weighted average number of sharesBasic


9,009,578



9,114,452



6,014,050Diluted


9,015,881



9,116,516



6,014,218    85




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries



Consolidated
    Statements of Shareholders Equity and Comprehensive
    Income

Years
    Ended December 31, 2007, 2006 and 2005  AccumulatedOtherCommon


Retained


ComprehensiveStock


Earnings


Income (Loss)


Total(Dollars in thousands)Balances, January 1, 2005

$
5,880


$
28,803


$
9


$
34,692Issuance of stock


44,270











44,270Stock-based employee compensation


83











83Comprehensive incomeNet income






3,850







3,850Unrealized losses on investments, net ofdeferred federal income tax benefit of $343










(668
)


(668
)Total comprehensive income














3,182Balances, December 31, 2005

$
50,233


$
32,653


$
(659
)

$
82,227Issuance of stock


48











48Stock-based employee compensation


297











297Comprehensive incomeNet income






4,676







4,676Unrealized gains on investments, net ofdeferred federal income tax expense of $509










987



987Total comprehensive income














5,663Balances, December 31, 2006

$
50,578


$
37,329


$
328


$
88,235Retirement of common stock

$
(2,135
)










(2,135
)Issuance of stock


67











67Stock-based employee compensation


531











531Comprehensive incomeNet income






10,325







10,325Unrealized gains on investments, net ofdeferred federal income tax expense of $598










1,231



1,231Total comprehensive income














11,556Balances, December 31, 2007

$
49,041


$
47,654


$
1,559


$
98,254    86




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries



Consolidated
    Statements of Cash Flows

Years
    Ended December 31, 2007, 2006 and 2005  2007


2006


2005(Dollars in thousands)Cash flows from operating activitiesNet income

$
10,325


$
4,676


$
3,850Adjustments to reconcile net income to cash provided by
    operating activities Depreciation and amortization


923



923



642Bad debt expense


(2,275
)


700



(71
)Net (gain) loss on sales and other dispositions of investments


(3,350
)


231



168Stock compensation expense


598



345



82Deferred federal income tax expense


2,336



273



365Change in assets and liabilitiesPremiums and agents balances receivable, net


(1,792
)


2,536



(3,834
)Accrued investment income


2



(396
)


(265
)Reinsurance recoverable, net


12,361



38,852



(30,874
)Prepaid reinsurance premiums


1,218



(4,457
)


(1,873
)Deferred policy acquisition costs


(5,357
)


730



215Prepaid expenses and other assets


391



1,312



1,451Losses and loss adjustment expenses


(10,325
)


(28,023
)


21,217Unearned premiums


12,966



(2,381
)


2,450Accrued expenses and other liabilities


(2,506
)


(7,790
)


8,664Premiums in advance


(1,697
)


(2,125
)


6,168Federal income tax payable (recoverable)


(1,590
)


1,675



(3,531
)Net cash provided by operating activities


12,228



7,081



4,824Cash flows from investing activitiesProceeds from maturities of debt securities


20,316



9,621



6,723Proceeds from sales of debt securities


34,855



29,313



35,334Proceeds from sales of equity securities


19,799



4,582



4,203Purchases of debt securities


(46,443
)


(48,527
)


(66,368
)Purchases of equity securities


(11,575
)


(4,743
)


(4,164
)Purchases of other investments


(1,147
)


(535
)


(553
)Purchases of subsidiaries, net of cash acquired of $13,356 and
    $168 in 2007 and 2005, respectively


(27,736
)






(1,386
)Purchases of fixed assets


(467
)


(1,666
)


(742
)Capital Contribution to NP Capital Trust I






(620
)


Net cash used in investing activities


(12,398
)


(12,575
)


(26,953
)Cash flows from financing activitiesProceeds from issuance of common stock, net










44,270Repurchases of common stock


(2,135
)






Proceeds from issuance of debt (net of $690 of issuance costs
    paid in 2006)






21,874



38,014Proceeds from borrowings


25,298







Repayments of bank debt


(4,142
)


(4,460
)


(55,714
)Net cash provided by financing activities


19,021



17,414



26,570Increase in cash and cash equivalents


18,851



11,920



4,441Cash and cash equivalentsBeginning of year


46,039



34,119



29,678End of year

$
64,890


$
46,039


$
34,119Supplemental cash flow information  cash paid
    during the year forInterest

$
3,182


$
1,674


$
1,074Federal income taxes


2,452



402



5,194Supplemental disclosure of noncash investing activitiesLiabilities assumed in purchase of subsidiaries


141,727







2,663    87




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes
    to Consolidated Financial Statements
  1.
    Description
    of Business                   88




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
                       89




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  2.
    Acquisition  Capital
    City Holding Company, Inc.
      Fair value of assets acquired

$
171,269Fair value of liabilities assumed


141,727Fair value of net assets acquired


29,542Total purchase price, including expenses


41,092Resulting goodwill

$
11,550       Twelve Months


Twelve MonthsEnded


EndedDecember 31,


December 31,2007


2006(In millions,


(In millions,except per share


except per sharedata)


data)Revenues from continuing operations

$
143,560


$
150,966Net income from continuing operations


4,060



8,511Net Income from continuing operations per share  basic


0.46



0.93Net Income from continuing operations per share 
    diluted


0.46



0.93   3.
    Discontinued
    Operations   90




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
      2007


2006


2005(In thousands)Operating results:Net premiums earned

$
14,265


$
13,584


$
27Investment income, net of investment expense


1,041



803



137Net realized capital gains (losses)


30



(17
)


Other revenues


443



515



2Total revenues


15,779



14,885



166Loss and loss adjustment expenses, net


3,427



4,501



32Policy acquisitions costs


2,998



2,974



3Other underwriting and operating expenses


722



519



43Total expenses


7,147



7,994



78Income before income taxes


8,632



6,891



88Federal income tax expense


2,923



2,340



30Net income from discontinued operations

$
5,709


$
4,551


$
58   2007(In thousands)Assets of Discontinued Operations:Debt securities available for sale, at fair value

$
13,011Accrued investment income


117Premiums and agents receivable, net


278Reinsurance recoverables onPaid losses


1Unpaid losses


190Other assets


679Total assets

$
14,276Liabilities of Discontinued Operations:Unpaid losses and loss adjustment expenses

$
1,639Unearned premiums


3,391Amounts due to reinsurers


8Accrued expenses and other liabilities


223Premiums in advance


2,994Amounts withheld for others


30Total liabilities

$
8,285  91




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  4.
    Summary
    of Significant Accounting Policies  Basis
    of Financial Presentation and Principles of
    Consolidation
    Investments
  available-for-sale Available-for-sale Available-for-sale
        Cash
    and Cash Equivalents
    Premiums
    and Agents Balances Receivable
   92




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Deferred
    Policy Acquisition Costs
    Property
    and Equipment
    December 31,2007


2006(Dollars in thousands)Land

$
630


$
630Building


3,342



3,342Computer equipment


3,495



1,491Furniture and fixtures


894



469Leasehold Improvements


1,199



834Office equipment


982



415Automobiles


164



16410,706



7,345Accumulated depreciation and amortization


4,963



1,399Property and equipment, net

$
5,743


$
5,946   Unpaid
    Losses and Loss Adjustment Expenses and Reinsurance
    Recoverables
      Reinsurance
   93




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Stock-Based
    Compensation
    Revenue
    Recognition
            Segment
    Reporting
    Federal
    Income Taxes
      Earnings
    Per Share
   94




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Use of
    Estimates
    other-than-temporary
  New
    Accounting Pronouncements
  Fair Value
    Measurements,
  The
    Fair Value Option for Financial Assets and Financial
    Liabilities
  Accounting for Income Taxes.
  5.
    Goodwill    Commercial


Personal


Agency


AdministrativeLines


Lines


Services


ServicesJanuary 1, 2007














Capital City Acquisition


11,550











December 31, 2007

$
11,550


$



$



$
    95




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    6.
    Investments    Cost or


Gross


GrossAmortized


Unrealized


UnrealizedCost


Gains


Losses


Fair Value(Dollars in thousands)December 31, 2007U.S. government and agency securities

$
14,454


$
623


$



$
15,077Foreign government securities


304



3







307Corporate bonds


38,659



319



462



38,516Municipal securities


67,012



1,385



4



68,393Mortgage-backed securities


65,526



990



331



66,185Asset-backed securities


12,229



58



84



12,203Total debt securities


198,184



3,378



881



200,681Common stocks


3,335



20



301



3,054Preferred stocks


1,000



37







1,037Total

$
202,519


$
3,435


$
1,182


$
204,772December 31, 2006U.S. government and agency securities

$
30,684


$
142


$
300


$
30,526Foreign government securities


308







8



300Corporate bonds


30,087



35



701



29,421Municipal securities


7,003



34



2



7,035Mortgage-backed securities


33,058



112



810



32,360Asset-backed securities


7,771



10



89



7,692Total debt securities


108,911



333



1,910



107,334Common stocks


9,302



2,123



49



11,376Total

$
118,213


$
2,456


$
1,959


$
118,710  96




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2007


2006


2005(Dollars in thousands)Net unrealized gains (losses) at beginning of year

$
328


$
(659
)

$
9Increase in net unrealized gains (losses):Debt securities


4,074



742



(1,422
)Preferred stock


37







Common stock


(2,355
)


754



411Net (increase) decrease in deferred federal income tax expense


(601
)


(509
)


343Increase (decrease) in net unrealized gains, net of deferred
    taxes


1,155



987



(668
)Net unrealized gains (losses) from continuing operations at end
    of year


1,483



328



(659
)Unrealized gains from discontinued operations at end of year net
    of increase in deferred federal income taxes of ($32)


76







Total net unrealized gains (losses) at end of year

$
1,559


$
328


$
(659
)     Less than 12 Months


12 Months or More


TotalGross





Gross





GrossFair


Unrealized


Fair


Unrealized


Fair


UnrealizedValue


Loss


Value


Loss


Value


Loss(Dollars in thousands)December 31, 2007U.S. government and agency securities

$



$



$



$



$



$
Foreign government securities






















Corporate bonds


2,620



29



17,503



433



20,123



462Municipal securities


3,002



4











3,002



4Mortgage-backed securities


1,737



6



17,628



325



19,365



331Asset-backed securities


974



61



2,256



23



3,230



84Total debt securities

$
8,333


$
100


$
37,387


$
781


$
45,720


$
881Equity securities

$
2,442


$
301


$



$



$
2,442


$
301December 31, 2006U.S. government and agency securities

$
2,062


$
6


$
16,670


$
294


$
18,732


$
300Foreign government securities










299



9



299



9Corporate bonds


3,416



25



22,272



675



25,688



700Municipal securities


1,426



2











1,426



2Mortgage-backed securities


1,164



5



26,248



805



27,412



810Asset-backed securities


73







6,007



89



6,080



89Total debt securities

$
8,141


$
38


$
71,496


$
1,872


$
79,637


$
1,910Equity securities

$
761


$
44


$
40


$
5


$
801


$
49  97




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
      other-than-temporarily
  sub-prime sub-prime
    Amortized


FairCost


Value(Dollars in thousands)Due within one year

$
7,380


$
7,369Due after one year through five years


51,640



52,496Due after five years through ten years


51,021



51,936Due after ten years


10,388



10,492Mortgage-backed securities


65,526



66,185Asset-backed securities


12,229



12,203Total debt securities

$
198,184


$
200,681  98




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2007


2006


2005(Dollars in thousands)Interest income fromDebt securities

$
6,900


$
4,014


$
3,707Cash and cash equivalents


2,274



2,014



556Dividends fromCommon stocks


206



177



152Total investment income


9,380



6,205



4,415Less investment expenses


704



474



550Net investment income

$
8,676


$
5,731


$
3,865     2007


2006


2005(Dollars in thousands)Proceeds from discretionary sales of debt securities

$
34,855


$
29,313


$
35,334Related realized gains


223



88



115Related realized losses


158



565



619Proceeds from discretionary sales of equity securities


19,799



4,582



4,203Related realized gains


3,838



704



571Related realized losses


583



244



223     7.
    Fair
    Value of Financial Instruments  Disclosures about Fair Value of Financial
    Instruments,
  available-for-sale Accounting for Certain
    Investments in Debt and Equity Securities,
 99




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  8.
    Deferred
    Policy Acquisition Costs    2007(1)


2006


2005(Dollars in thousands)Balance from continuing operations, beginning of period

$
8,295


$
9,578


$
9,793Additions from continuing operations


27,145



17,365



21,149Additions from discontinued operations






3,527



133Amortization from continuing operations


(21,709
)


(18,648
)


(21,494
)Amortization from discontinued operations






(2,974
)


(3
)Balance, end of period

$
13,731


$
8,848


$
9,578     (1)
    
    Discontinued operations are excluded from the 2007 column,
    because the effects of discontinued operations are excluded from
    year end 2007 deferred acquisition cost balance. As a result,
    the beginning of the period balance for 2007 was also reduced by
    $553,000.  9.
    Liability
    for Unpaid Losses and LAE    2007


2006


2005Balance, beginning of period from continued operations

$
89,755


$
117,758


$
96,561Balance, beginning of a period from discontinued operations






20Liability for losses and LAE assumed


94,474







Less reinsurance recoverables


33,321



60,022



36,544Less reinsurance recoverables acquired


29,816







Less net loss and LAE of discontinued operations


1,592



12



Net balance


119,500



57,744



60,017Incurred related toCurrent year from continued operations


50,238



33,367



49,406Current year from discontinued operations






4,502



32Prior years from continued operations-North Pointe(1)


3,449



(2,492
)


(5,435
)Prior years from continued operations-Capital City(1)(3)


(139
)






Prior years from discontinued operations






(2
)Total incurred


53,548



35,375



44,003Paid related toCurrent year from continued operations


19,766



11,994



23,923Current year from discontinued operations






2,911



24Prior years from continued operations


32,159



21,775



22,329Prior years from discontinued operations






5Total paid


51,925



36,685



46,276Net balance, end of period


121,123



56,434



57,744Plus reinsurance recoverables, excluding Citizens assessment(2)


51,141



33,321



60,034Balance, end of period

$
172,264


$
89,755


$
117,778  100




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    (1)
    
    Incurred related to prior years includes $372,000 favorable
    development related to discontinued operations and $3,682,000
    unfavorable development from continuing operations for 2007.
    Discontinued operations are excluded from the 2007 column.(2)
    
    For the purpose of comparability, at December 31, 2005 the
    Citizens assessment of $5,955,000 is excluded from the
    reinsurance recoverable amounts in the above summary (See
    Note 16).(3)
    
    Incurred for prior years includes is based on six months of
    development for reserves assumed in purchase.            10.
    Reinsurance   101




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  policy-by-policy
                   102




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
        Direct


Assumed


Ceded


Net(Dollars in thousands)2007Premiums written

$
115,666


$
3,658


$
11,916


$
107,408Premiums earned


106,684



3,102



15,607



94,179Losses and LAE incurred


67,002



3,304



16,758



53,548Losses and LAE reserves


164,606



7,658



51,141



121,123Unearned premium reserves


62,287



1,022



7,770



55,5392006Premiums written

$
90,175


$
10


$
29,058


$
61,127Premiums earned


95,625



27



29,001



66,651Losses and LAE incurred


47,193



(340
)


15,979



30,874Losses and LAE reserves


88,030



1,725



33,321



56,434Unearned premium reserves


42,315



5



11,881



30,4392005Premiums written

$
110,409


$
613


$
24,943


$
86,079Premiums earned


108,363



1,288



24,942



84,709Losses and LAE incurred


101,435



(735
)


56,729



43,971Losses and LAE reserves


115,059



2,719



60,034



57,744Unearned premium reserves


44,679



22



7,424



37,277     2007


2006(Dollars in thousands)Paid losses and LAE

$
5,337


$
4,168Unpaid losses and LAE


51,141



33,321Prepaid reinsurance premiums


7,770



11,881Amounts due from reinsurers

$
64,248


$
49,370  103




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2007


2006(Dollars in thousands)General Reinsurance

$
16,864


$
3,123National Workers Compensation Reinsurance Pool


14,591



Swiss Reinsurance American Corporation


8,583



17,119MCCA


5,379



7,589Platinum Reinsurance Company


4,779



4,702TOA Reinsurance Company of America


4,682



1National Flood Insurance Program


1,486



9Folksamerica Reinsurance Company


1,480



3,494Munich Reinsurance America, Inc.


1,220



45Lloyds Syndicate Number 4472


1,043



All other


4,141



13,288Total reinsurance recoverables

$
64,248


$
49,370   11.
    Federal
    Income Taxes    2007


2006


2005(Dollars in thousands)Current tax (benefit) expense

$
(543
)

$
(365
)

$
1,601Deferred tax expense (benefit) relating toNOL carryforwards


326



358



401Other deferred tax balances


1,972



17



(5
)Total provision for income tax

$
1,755


$
10


$
1,997     2007


2006


2005(Dollars in thousands)Tax provision at statutory rate 34.0%

$
2,166


$
46


$
1,968Tax effect ofDividend received deduction


(42
)


(36
)


(30
)Tax-exempt interest


(356
)






Other, net


(13
)






59Total provision for income tax

$
1,755


$
10


$
1,997  104




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2007


2006(Dollars in thousands)Deferred federal income tax assetsLosses and loss adjustment expenses

$
5,239


$
2,214Unearned premiums


3,898



2,483Net operating loss carryforwards


1,945



2,271Premiums receivable


251



323Lease obligation


74



120Intangible asset


272



306Accrued assessments


1,772



Other


1,463



544Total deferred tax assets


14,914



8,261Deferred federal income tax liabilitiesDeferred policy acquisition costs


4,668



3,008Net unrealized gains on investments


767



169Other


104



23Total deferred tax liabilities


5,539



3,200Net deferred federal income tax assets

$
9,375


$
5,061       NOL Carryforwards

Year Originated


Year of Expiration(Dollars in thousands)$163


1997



2011472


1999



20181,393


2000



20193,693


2001



2020$5,721    105




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Gross unrecognized tax benefit (FIN 48
    liability) at January 1, 2007

$
163Gross increase in unrecognized tax positions related to prior
    years

$
2,857Gross decrease in unrecognized tax positions related to prior
    years

$
(38
)Gross increase in unrecognized tax positions related to current
    year

$
Gross decrease in unrecognized tax positions related to current
    year

$
(1,122
)Gross decrease in unrecognized tax positions for lapse of
    statute of limitations

$
(28
)Gross decrease for settlements of tax positions

$
Gross unrecognized tax benefit at December 31, 2007

$
1,832             12.
    Shareholders
    Equity  Common
    Stock
  Rule 10b5-1
 106




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
              Preferred
    Stock
    13.
    Stock 
    Based Compensation  Stock
    Options
       107




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Stock Option Assumptions Granted onSeptember 12,


June 5,


November 27,


September 28,2007


2007


2006


2005Fair value of the underlying common stock

$
10.86/share


$
11.11/share


$
10.50/share


$
12.00/shareWeighted average life of options


6.5 years



6.5 years



6.5 years



6.5 yearsRisk-free interest rate


4.11
%


4.95
%


4.46
%


4.13
%Dividend yield


0.00
%


0.00
%


0.00
%


0.00
%Weighted average volatility assumption


27.60
%


41.10
%


28.20
%


30.20
%Weighted average grant date fair value of options granted

$
4.08


$
5.51


$
4.08


$
4.76     Weighted-Weighted-


AverageAverage


RemainingOptions


Exercise Price


Contractual Term2007Outstanding  beginning of year


472,500


$
11.70Granted


270,000


$
10.88Forfeited


30,000


$
12.00Outstanding  end of year


712,500


$
11.38



8.64Exercisable at end of year


158,000


$
11.82



7.892006Outstanding  beginning of year


402,500


$
12.00Granted


95,000


$
10.50Forfeited


25,000


$
12.00Outstanding  end of year


472,500


$
11.70



8.98Exercisable at end of year


75,500


$
12.00



8.742005Outstanding  beginning of year





$
Granted


402,500


$
12.00Forfeited





$
Outstanding  end of year


402,500


$
12.00



9.75Exercisable at end of year





$




    108




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Restricted
    Stock
        14.
    Debt  Senior
    Credit Facility
         109




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    
    adjusted capital and surplus will be in excess of 275% of
    authorized control level risk-based capital as of each fiscal
    year end;
    there shall be no more than four IRIS calculations that result
    in unusual values at each fiscal year end;
    the ratio of net premiums written to statutory capital and
    surplus will not exceed more than 4.0 to 1.0 in the case of
    North Pointe Casualty Insurance Company, 2.5 to 1.0 in the case
    of North Pointe Insurance Company, and 2.5 to 1.0 in the case of
    Capital City Insurance Company; and
    the ratio of gross premiums written to statutory surplus will
    not exceed more than 10.0 to 1.0 in the case of North Pointe
    Casualty Insurance Company, 3.0 to 1.0 in the case of North
    Pointe Insurance Company and 3.0 to 1.0 in the case of Capital
    City Insurance Company.    Trust Preferred
    Securities
  30-year,
       110




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
      
    9.62% $2,000,000 Trust preferred securities (Capital City
    Insurance Company, S.C. Statutory Trust I These debentures mature in December 2032. These debentures
    are redeemable at par at the option of the Company, in whole or
    in part, on any interest payment date on or after
    December 4, 2007. This debenture was paid in full on
    February 29, 2008 upon exercising the redemption option.
    9.66% $6,000,000 Trust preferred securities (Capital City
    Insurance Company, S.C. Statutory Trust II) These debentures mature in May 2033. These debentures are
    redeemable at par at the option of the Company, in whole or in
    part, on any interest payment date on or after May 15, 2008.
    9.49% $2,000,000 Trust preferred securities (Capital City
    Insurance Company, S.C. Statutory Trust III These debentures mature in June 2034. These debentures are
    redeemable at par at the option of the Company, in whole or in
    part, on any interest payment date on or after June 17,
    2009.  Mortgage
    Debt Obligation
      Year

Amount(Dollars in thousands)2008

$
1302009


1372010


21,4252011


1,9752012 and thereafter


30,620Total debt

$
54,287   15.
    Commitments
    and Contingent Liabilities    Minimum


MinimumLease


Sublease


Net FutureYear Ended

Commitments


Revenue


Commitments(Dollars in thousands)2008

$
1,736


$
(159
)

$
1,5772009


1,423



(109
)


1,3142010


650



(5
)


6452011


151



(3
)


1482012


33







33$
3,993


$
(276
)

$
3,717  111




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
        16.
    Guaranty
    Funds and State Assessments       112




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
          17.
    Related
    Party Transactions       113




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
            18.
    401(k)
    Profit Sharing Plan       114




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  19.
    Earnings
    Per Share    2007


2006


2005(Dollars in thousands, except share data)Net income from continuing operations

$
4,616


$
125


$
3,792Net income from discontinued operations


5,709



4,551



58Weighted average shares outstanding used for basic EPS


9,009,578



9,114,452



6,014,050Effect of dilutive securitiesRestricted stock


6,303



2,064



168Weighted average shares outstanding used for diluted EPS


9,015,881



9,116,516



6,014,218Basic earnings per shareIncome from continuing operations

$
0.51


$
0.01


$
0.63Income from discontinued operations


0.63



0.50



0.01Diluted earnings per shareIncome from continuing operations

$
0.51


$
0.01


$
0.63Income from discontinued operations


0.63



0.50



0.01       20.
    Statutory
    Capital and Surplus and Restrictions Thereon       115




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
              2007


2006


2005(Dollars in thousands)Statutory capital and surplusNorth Pointe Insurance

$
38,555


$
49,841


$
43,861North Pointe Casualty


19,085



20,734



12,714Midfield Insurance


6,763



8,199



5,828Captial City Insurance Company


38,287







Statutory net income (loss)North Pointe Insurance

$
(1,573
)

$
2,927


$
7,053North Pointe Casualty


(366
)


939



(6,425
)Midfield Insurance


1,560



2,293



617Captial City Insurance Company


4,524







      116




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
      21.
    Segment
    Information               117




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2007


2006


2005(Dollars in thousands)Total revenues from continuing operationsCommercial lines productsLiability

$
45,075


$
27,384


$
23,720Property


12,467



7,320



6,299Commercial multi-peril


1,660



15,932



22,230Commercial automobile


10,702



5,823



6,156Workers compensation


14,018







Other


4,509



2,997



2,661Total commercial lines


88,431



59,456



61,066Personal lines productsPersonal automobile










1,459Homeowners


4,905



7,195



22,184Other


843







Total personal lines


5,748



7,195



23,643Administrative servicesAffiliated companies


31,770



25,504



33,232Nonaffiliated companies


2,500



1,369



1,901Total administrative services


34,270



26,873



35,133Agency services


5,783







Corporate and eliminationsInvestment activity


11,996



5,517



3,697Eliminations


(33,404
)


(25,504
)


(33,232
)Total revenues

$
112,824


$
73,537


$
90,307 118




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  2007


2006


2005(Dollars in thousands)Income (loss) from continuing operations before federal
    income tax expenseCommercial lines productsLiability

$
11,964


$
10,700


$
3,033Property


(2,625
)


(2,237
)


(2,086
)Commercial multi-peril


(9,576
)


(4,540
)


(1,299
)Commercial automobile


(7,923
)


(828
)


(637
)Workers compensation


5,557







Other


(627
)


38



343Total commercial lines


(3,230
)


3,133



(646
)Personal lines productsPersonal automobile


326



(2,447
)


367Homeowners


613



(3,056
)


(2,249
)Other


(463
)






Total personal lines


476



(5,503
)


(1,882
)Administrative services


981



363



6,961Agency services


980







CorporateInvestment activity


11,996



5,517



3,697Other expense, net


(4,832
)


(3,375
)


(2,341
)Total income from continuing operations before federal income
    taxes

$
6,371


$
135


$
5,789   22.
    Subsequent
    Events       119




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
   120




---



##### 



North
    Pointe Holdings Corporation
 Schedule I
    Summary of Investments  Other than Investments in
    Related Parties  December 31, 2007Amount at WhichShown in theCost


Fair Value


Balance Sheet(Dollars in thousands)Fixed Maturities:Bonds:U.S. government and agency securities

$
14,454


$
15,077


$
15,077Foreign government securities


304



307



307Corporate bonds


38,659



38,516



38,516Municipal securities


67,012



68,393



68,393Mortgage-backed securities


65,526



66,185



66,185Asset-backed securities


12,229



12,203



12,203Total fixed maturities


198,184



200,681



200,681Equity Securities:Common stocksPublic utilities


24



24



24Banks, trust and insurance companies


571



496



496Industrial, miscellaneous and all other


2,740



2,534



2,534Preferred stocks


1,000



1,037



1,037Total equity securities


4,335



4,091



4,091Other Investments


2,241



2,241



2,241Total investments

$
204,760


$
207,013


$
207,013  121




---



##### 



North
    Pointe Holdings Corporation (Parent Company Only)



Schedule II 
    Condensed Financial Information of Registrant  Condensed
    Balance Sheets
  December 31,2007


2006(Dollars in thousands)ASSETSInvestment in subsidiaries*

$
144,549


$
101,579Federal income taxes-current






401Federal income taxes-deferred


443



289Cash


387



10,606Other assets


1,321



1,401Total assets

$
146,700


$
114,276LIABILITIES AND SHAREHOLDERS EQUITYAccounts payable and accrued expenses

$
471


$
235Federal income taxes payable


490



Due to affiliates*


5,586



5,186Debt


41,899



20,620Total liabilities


48,446



26,041Shareholders equity:Common stock


49,041



50,578Retained earnings


47,654



37,329Accumulated other comprehensive income


1,559



328Total shareholders equity


98,254



88,235Total liabilities and shareholders equity

$
146,700


$
114,276     *
    
    Eliminated in consolidation.     122




---



##### 



North
    Pointe Holdings Corporation (Parent Company Only)
  Schedule II 
    Condensed Financial Information of
    Registrant  (Continued)
  Condensed
    Statements of Income
  Years Ended2007


2006


2005(Dollars in thousands)RevenuesDividends from subsidiaries*

$
12,000


$
100


$
6,000Other Income


332



615



12,332



715



6,000ExpensesInterest expense


2,635



1,559



899Other operating costs and expenses


2,305



1,938



1,4854,940



3,497



2,384Income (loss) before income tax benefit and equity in earnings
    of consolidated subsidiaries


7,392



(2,782
)


3,616Income tax benefit


(1,664
)


(977
)


(814
)Income (loss) from continuing operations before equity in
    undistributed earnings of subsidiaries


9,056



(1,805
)


4,430Equity in undistributed net (loss) income from continuing
    operations of consolidated subsidiaries*


(4,440
)


1,930



(638
)Income from continuing operations  net of tax


4,616



125



3,792Income from discontinued operations  net of tax


5,709



4,551



58Net income

$
10,325


$
4,676


$
3,850     *
    
    Eliminated in consolidation.     123




---



##### 



North
    Pointe Holdings Corporation (Parent Company Only)
  Schedule II 
    Condensed Financial Information of
    Registrant  (Continued)
  Condensed
    Statements of Shareholders Equity and Comprehensive
    Income
  Years Ended2007


2006


2005(Dollars in thousands)Shareholders equity as of January 1,

$
88,235


$
82,227


$
34,692Issuance of stock


67



48



44,270Change in stock-based employee compensation


531



297



83Purchase and retirement of common stock


(2,135
)






Comprehensive incomeNet income


10,325



4,676



3,850Unrealized gain (loss) on investments


1,231



987



(668
)Total comprehensive income


11,556



5,663



3,182Shareholders equity as of December 31,

$
98,254


$
88,235


$
82,227      124




---



##### 



North
    Pointe Holdings Corporation (Parent Company Only)
  Schedule II 
    Condensed Financial Information of
    Registrant  (Continued)
  Condensed
    Statements of Cash Flows
  For the Years Ended2007


2006


2005(Dollars in thousands)CASH FLOWS FROM OPERATING ACTIVITIES:Net income

$
10,325


$
4,676


$
3,850Adjustments to reconcile net income to net cash provided by
    (used in) operating activities:Equity in undistributed (income) loss of consolidated
    subsidiaries


(1,269
)


(6,479
)


580Unearned stock compensation


598



345



82Changes in:Other assets


80



(90
)


766Intercompany receivable or payable


400



1,520



(9,815
)Accounts payable and accrued expenses


236



167



(88
)Income taxes


737



2,374



(1,826
)Net cash provided by (used in) operating activities


11,107



2,513



(6,451
)CASH FLOWS USED IN INVESTING ACTIVITIES:Contributions to subsidiaries






(9,000
)


(20,000
)Capital contribution to NP Capital Trust I






(620
)


Purchase of subsidiary


(40,470
)






Net cash used in investing activities


(40,470
)


(9,620
)


(20,000
)CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from issuance of common stock










44,270Purchases and retirement of common stock


(2,135
)






Proceeds from issuance of debt (net of $690 of issuance costs
    paid in 2006)


25,298



21,874



38,014Repayment of bank debt


(4,019
)


(4,345
)


(55,676
)Net cash provided by financing activities


19,144



17,529



26,608Change in cash


(10,219
)


10,422



157Cash, beginning of year


10,606



184



27Cash, end of year

$
387


$
10,606


$
184      125




---



##### 



North
    Pointe Holdings Corporation (Parent Company Only)
  Schedule II 
    Condensed Financial Information of
    Registrant  (Continued)
  Notes to
    Condensed Financial Statements
       126




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
 Schedule III
    Supplementary Insurance Information
    For the Year Ended December 31, 2007  (A)

(B)


(C)


(D)


(E)


(F)Future Policy





OtherBenefits,





PolicyDeferred


Losses,





ClaimsPolicy


Claims and





andAcquisition


Loss


Unearned


Benefits


PremiumSegment

Costs


Expenses


Premiums


Payable


Revenue(Dollars in thousands)Personal lines

$
2,180


$
7,410


$
7,106


$



$
5,748Commercial lines


11,551



164,854



56,203







88,431Administrative operations


















Total

$
13,731


$
172,264


$
63,309


$



$
94,179   (A)

(G)


(H)


(I)


(J)


(K)AmortizationBenefits,


of DeferredNet


Claims,


Policy


Other


NetInvestment


Settlement


Acquistion


Operating


PremiumsSegment

Income


Expenses


Costs


Expenses


WrittenPersonal lines

$



$
2,168


$
1,625


$
1,478


$
10,600Commercial lines






53,030



22,752



15,879



96,808Administrative operations










17,959



13,423



Agency services














4,803



Corporate


8,676











3,431



Eliminations






(1,650
)


(20,673
)


(11,033
)


Total

$
8,676


$
53,548


$
21,663


$
27,981


$
107,408  127




---



##### 



North
    Pointe Holdings Corporation and Subsidiaries
  Schedule III
    Supplementary Insurance Information
    For the Year Ended December 31, 2006
  (A)

(B)


(C)


(D)


(E)


(F)Future Policy





OtherBenefits,





PolicyDeferred


Losses,





ClaimsPolicy


Claims and





andAcquisition


Loss


Unearned


Benefits


PremiumSegment

Costs


Expenses


Premiums


Payable


Revenue(Dollars in thousands)Personal lines

$
426


$
13,982


$
6,483


$



$
59,456Commercial lines


8,422



75,773



35,837







7,195Administrative operations


















Total

$
8,848


$
89,755


$
42,320


$



$
66,651   (A)

(G)


(H)


(I)


(J)


(K)AmortizationBenefits,


of DeferredNet


Claims,


Policy


Other


NetInvestment


Settlement


Acquistion


Operating


PremiumsSegment

Income


Expenses


Costs


Expenses


WrittenPersonal lines

$



$
7,122


$
3,080


$
2,495


$
4,987Commercial lines






23,752



17,593



14,978



56,140Administrative operations










15,096



11,192



Corporate


5,731











1,866



Eliminations










(16,733
)


(8,750
)


Total

$
5,731


$
30,874


$
19,036


$
21,781


$
61,127  128




---



##### 



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





OtherBenefits,





PolicyDeferred


Losses,





ClaimsPolicy


Claims and





andAcquisition


Loss


Unearned


Benefits


PremiumSegment

Costs


Expenses


Premiums


Payable


Revenue(Dollars in thousands)Personal lines

$
1,241


$
35,663


$
5,709






$
23,643Commercial lines


8,337



82,115



38,992







61,066Administrative operations


















Total

$
9,578


$
117,778


$
44,701






$
84,709   (A)

(G)


(H)


(I)


(J)


(K)AmortizationBenefits,


of DeferredNet


Claims,


Policy


Other


NetInvestment


Settlement


Acquistion


Operating


PremiumsSegment

Income


Expenses


Costs


Expenses


WrittenPersonal lines

$



$
14,766


$
6,830


$
3,929


$
22,790Commercial lines






29,205



17,634



14,874



63,289Administrative operations










18,958



9,118



Corporate


3,865











1,472



Eliminations










(21,646
)


(11,581
)


Total

$
3,865


$
43,971


$
21,776


$
17,812


$
86,079  129




---



##### 



North
    Pointe Holdings Corporation
 Schedule IV 
    Reinsurance  PercentageCeded to


Assumed





of AmountGross


Other


from Other


Net


AssumedAmount


Companies


Companies


Amount


to Net(Dollars in thousands)Year ended December 31, 2007Premiums earned:Property and liability

$
106,684


$
15,607


$
3,102


$
94,179



3.29
%Accident and health


















0.00
%Total premiums

$
106,684


$
15,607


$
3,102


$
94,179Year ended December 31, 2006Premiums earned:Property and liability

$
95,625


$
29,001


$
27


$
66,651



0.04
%Accident and health


















0.00
%Total premiums

$
95,625


$
29,001


$
27


$
66,651Year ended December 31, 2005Premiums earned:Property and liability

$
107,909


$
24,683


$
1,288


$
84,514



1.52
%Accident and health


454



259







195



0.00
%Total premiums

$
108,363


$
24,942


$
1,288


$
84,709  130




---



##### 



North
    Pointe Holdings Corporation and North Pointe Companies
 Schedule VI
    Supplemental Information Concerning Property and Casualty
    Insurance Operations  Losses and LossAdjustment


Paid LossesExpenses Incurred


and LossRelated to


AdjustmentCurrent Year


Prior Years


Expenses(Dollars in thousands)For the Years Ended December 31,2007

$
50,238


$
3,310


$
51,9252006

$
37,869


$
(2,494
)

$
36,6852005

$
49,438


$
(5,435
)

$
46,276   Rule 12-18 Regulation S-X.
 131




---



##### 



15(a)(3)
    Exhibits.
  EXHIBIT INDEX
  Exhibit No

Description3
.1*

Second Amended and Restated Articles of Incorporation of North
    Pointe Holdings Corporation.3
.2 ▼

Second Amended and Restated Bylaws of North Pointe Holdings
    Corporation.10
.1+

Equity Incentive Plan as of November 2007.10
.2 «

Amendment No. 2 to the Second Amendment and Restated Credit
    Agreement, dated as of July 2, 2007, by and among the
    lenders, Comerica Bank, as agent, and North Pointe Holdings
    Corporation.10
.3 «

$10,500,000 Revolving Credit Note, dated as of July 2,
    2007, made by North Pointe Holdings Corporation in favor of
    Fifth Third Bank.10
.4 «

$10,500,00 Revolving Credit Note, dated July 2, 2007, made
    by North Pointe Holdings Corporation in favor of JPMorgan Chase
    Bank, N.A.10
.5 «

$14,000,000 Revolving Credit Note, dated July 2, 2007, made
    by North Pointe Holdings Corporation in favor of Comerica Bank.10
.6 «

Stock Pledge Agreement, dated July 2, 2007, by and among
    Capital City Acquisition Corp. and Comerica Bank, as agent.10
.7 «

Security Agreement, dated July 2, 2007, by and among
    Capital City Acquisition Corp., Capital Collection Services,
    Inc., Capital City Holding Company, Inc., Davis-Garvin Holdings,
    Inc., Capital Excess & Surplus Brokers, Inc.,
    Southeastern Claims Services, Inc., Safeco Products, Inc., and
    Charter Premium Audits, Inc. and Comerica Bank, as agent.10
.8*+

Employment Agreement by and between North Pointe Holdings
    Corporation and James G. Petcoff, dated June 10, 2005.10
.9*+

North Pointe Holdings Corporation Annual Incentive Compensation
    Plan.10
.10

Intentionally Omitted.10
.11*+

Employment Agreement by and between North Pointe Holdings
    Corporation and B. Matthew Petcoff, dated June 10, 2005.10
.7*

Investment Advisory Agreement, dated July 6, 2004, between
    North Pointe Insurance Company and JPMorgan Investment Advisors
    Inc. (formerly Banc One Investment Advisors Corporation).10
.8*

Investment Advisory Agreement, dated September 13, 2004,
    between North Pointe Insurance Company and Munder Capital
    Management.10
.9 u

North Pointe Holdings Corporation Investment Policy and
    Guidelines Dated as of September 17, 2007.10
.10**

Second Amended and Restated Credit Agreement, dated as of
    June 30, 2006, by and among the lenders, Comerica Bank, as
    agent, and North Pointe Holdings Corporation.10
.11**

Amended and Restated Pledge Agreement, dated June 30, 2006,
    by and between North Pointe Holdings and Comerica Bank as agent.10
.12**

Third Amended and Restated Stock Pledge Agreement, dated
    June 30, 2006, by and between North Pointe Financial
    Services, Inc. and Comerica Bank as agent.10
.13**

Second Amended and Restated Security Agreement, dated as of
    June 30, 2006, by and among certain of North Pointe
    Holdings Corporations subsidiaries, and Comerica Bank as
    agent.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*+

Consulting Agreement, dated March 5, 2003, by and between
    North Pointe Insurance Company and LVM Company10
.17*+

Consulting Agreement dated September 30, 2005, by and
    between North Pointe Holdings Corporation and Joon Moon. 132




---



##### 



Exhibit No

Description10
.18+

Separation and Consulting Agreement dated January 3, 2008,
    by and between QBE Holdings, Inc., North Pointe Holdings
    Corporation and James G. Petcoff.10
.19*

Agreement between North Pointe Insurance Company and C.S.A.C.
    Agency dated May 30, 2000.10
.20*

Agency Agreement, dated June 1, 2004, by and between North
    Pointe Insurance Company and Amelia Underwriters, Inc.10
.21*

Agency Agreement, dated March 24, 2003, by and between
    North Pointe Insurance Company and Insurance Brokers of Indiana.10
.22*

Reinsurance and Indemnity Agreement, effective July 1,
    2003, by and between North Pointe Insurance Company and
    Universal Fire & Casualty.10
.23*

Agreement, dated December 3, 2002, by and between North
    Pointe Insurance Company and the Associated Food Dealers of
    Michigan.10
.24

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 and the Administrative
    Trustee dated as of February 22, 2006.10
.25

Guarantee Agreement between North Pointe Holdings Corporation a
    Guarantor and LaSalle Bank National Association as Guarantee
    Trustee dated February 22, 2006.10
.26

Purchase Agreement among North Pointe Holdings Corporation, NP
    Capital Trust I and Merrill Lynch International dated as of
    February 22, 2006.10
.27

Junior Subordinated Indenture between North Pointe Holdings
    Corporation and LaSalle Bank National Association as Trustee,
    Dated February 22, 2006.10
.28

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
.29

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
.30*

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.10
.31

Assumption of Mortgage Agreement for the Purchase Agreement
    regarding 28819 Franklin Road, Southfield, Michigan, 48034,
    dated August 18, 2005.10
.32

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.10
.33*

Investment Advisory Agreement, dated June 16, 2004, between
    North Pointe Casualty Insurance Company and JPMorgan Investment
    Advisors Inc. (formerly Banc One Investment Advisors
    Corporation).10
.34*

Investment Management Agreement, dated June 10, 2005,
    between JPMorgan Investment Advisors Inc. and Home Pointe
    Insurance Company.10
.35 ∆+

Form of stock option award.10
.36 ∆+

Form of restricted stock option award.10
.37+

First Amendment to the Employment Agreement by and between North
    Pointe Holdings Corporation and James G. Petcoff, dated
    January 1, 2007.10
.38+

First Amendment to the Employment Agreement by and between North
    Pointe Holdings Corporation and B. Matthew Petcoff, dated
    January 1, 2007.10
.39 5

Amendment to the Consulting Agreement by and between North
    Pointe Insurance Company and LVM Company, dated April 6,
    2006.10
.40 5

Managing General Agency Agreement by and between North Pointe
    Insurance Company and South Pointe Financial Services, Inc.,
    dated July 1, 2006.10
.41 5

Reinsurance Agreement by and between North Pointe Insurance
    Company and Midfield Insurance Company dated September 1,
    2006. 133




---



##### 



Exhibit No

Description10
.42 5

Reinsurance Agreement by and between North Pointe Insurance
    Company and Midfield Insurance Company dated January 1,
    2007.10
.43 5

Addendum Number 1 to Reinsurance Agreement by and between North
    Pointe Insurance Company and Midfield Insurance Company dated
    January 1, 2007.10
.44 5

Reinsurance Agreement by and between North Pointe Casualty
    Insurance Company and Midfield Insurance Company dated
    January 1, 2007.10
.45**

$10,000,000 Revolving Credit Note, dated as of June 30,
    2006, made by North Pointe Holdings Corporation in favor of
    Comerica Bank.10
.46**

$3,000,000 Swing Line Credit Note, dated June 30, 2006,
    made by North Pointe Holdings Corporation in favor of Comerica
    Bank.10
.47**

$7,500,000 Revolving Credit Note, dated June 30, 2006, made
    by North Pointe Holdings Corporation, in favor of Fifth Third
    Bank, with Comerica Bank as agent.10
.48**

$7,500,000 Revolving Credit Note, dated June 30, 2006, made
    by North Pointe Holdings Corporation, in favor of JP Morgan
    Chase Bank, N.A., with Comerica as agent.10
.49 «

Stock Purchase Agreement by and among Hinton G. Davis, HGD
    Investment LP, First Venture Holdings, L.L.C., Mary Teresa Davis
    Tanner, Hinton G. Davis III Grantor Trust, Susan Cheri
    Davis McMillan, Capital City Acquisition Corp., and North Pointe
    Holdings Corporation Relating to the Purchase and Sale of 100%
    of the Capital Stock of Capital City Holding Company, Inc.,
    Davis-Garvin Holdings, Inc., Capital Excess & Surplus
    Brokers, Inc., Southeastern Claims Services, Inc., Safeco
    Products, Inc., and Charter Premium Audits, Inc. Dated as of
    May 11, 2007.10
.50 «

First Amendment to the Stock Purchase Agreement by and among
    Hinton G. Davis, HGD Investment LP, First Venture Holdings,
    L.L.C., Mary Teresa Davis Tanner, Hinton G. Davis III
    Grantor Trust, Susan Cheri Davis McMillan, Capital City
    Acquisition Corp., and North Pointe Holdings Corporation
    Relating to the Purchase and Sale of 100% of the Capital Stock
    of Capital City Holding Company, Inc., Davis-Garvin Holdings,
    Inc., Capital Excess & Surplus Brokers, Inc.,
    Southeastern Claims Services, Inc., Safeco Products, Inc., and
    Charter Premium Audits, Inc. Dated as of July 2, 2007.10
.51 u

Stock Purchase Agreement by and among Safe Harbour Holdings,
    L.L.C., American Capital Assurance Corp., North Pointe Holdings
    Corporation and North Pointe Financial Services, Inc., Relating
    to the Purchase and Sale of 100% of the Capital Stock of Home
    Pointe Insurance Company Dated as of October 22, 2007.10
.52 ¡+

Agreement regarding Employment, by and between North Pointe
    Holdings Corporation and Brian J. Roney dated November 2,
    2007.10
.53+

Amendment to the Consulting Agreement by and between North
    Pointe Insurance Company and LVM Company, dated
    September 7, 2007.10
.54¥

Agreement and Plan of Merger dated as of January 3, 2008
    among North Pointe Holdings Corporation, Noble Acquisition
    Corporation and QBE Holdings, Inc.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 pursuant to
    18 U.S.C. Section 1350 and
    Rule 13a-14(b)
    under the Securities Exchange Act of 1934.32
.2

Certification of 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 with the Registration Statement on
    Form S-1
    dated September 23, 2005.
    
    Previously filed with the
    Form 10-K
    for the year ended December 31, 2005.**
    
    Previously filed with the
    Form 10-Q
    for the quarter ended June 30, 2006.∆
    
    Previously filed with the
    Form 10-Q
    for the quarter ended September 30, 2005.5
    
    Previously filed with
    Form 10-K
    for the year ended December 31, 2006 134




---



##### 



«
    
    Previously filed with
    Form 10-Q
    for the quarter ended June 30, 2007.u
    
    Previously filed with
    Form 10-Q
    for the quarter ended September 30, 2007.▼
    
    Previously filed with
    Form 8-K
    filed on January 8, 2008.¥
    
    Previously filed with DEF14A Proxy Filings filed on
    January 9, 2008 and March 7, 2008.¡
    
    Previously filed with
    Form 8-K
    filed on January 16, 2008.+
    
    Compensatory plan or arrangement. 135




---



##### 



SIGNATURES
      By:
    /s/  James
    G. Petcoff          Signature

Title

Date/s/  James
    G.
    PetcoffJames
    G. Petcoff

Chief Executive Officer, President & Chairman of the
    Board

March 31, 2008/s/  B.
    Matthew
    PetcoffB.
    Matthew Petcoff

Chief Operating Officer, Executive Vice President &
    Director

March 31, 2008/s/  Brian
    J.
    RoneyBrian
    J. Roney

Chief Financial Officer & Senior
    Vice President

March 31, 2008/s/  Richard
    J.
    LindbergRichard
    J. Lindberg

Director

March 31, 2008/s/  Joon
    S.
    MoonJoon
    S. Moon

Director

March 31, 2008/s/  Jorge
    J.
    MoralesJorge
    J. Morales

Director

March 31, 2008/s/  R.
    Jamison Williams,
    Jr.R.
    Jamison Williams, Jr.

Director

March 31, 2008  136




---



##### 



EXHIBIT INDEX
  Exhibit No

Description3
.1*

Second Amended and Restated Articles of Incorporation of North
    Pointe Holdings Corporation.3
.2 ▼

Second Amended and Restated Bylaws of North Pointe Holdings
    Corporation.10
.1+

Equity Incentive Plan as of November 2007.10
.2 «

Amendment No. 2 to the Second Amendment and Restated Credit
    Agreement, dated as of July 2, 2007, by and among the
    lenders, Comerica Bank, as agent, and North Pointe Holdings
    Corporation.10
.3 «

$10,500,000 Revolving Credit Note, dated as of July 2,
    2007, made by North Pointe Holdings Corporation in favor of
    Fifth Third Bank.10
.4 «

$10,500,00 Revolving Credit Note, dated July 2, 2007, made
    by North Pointe Holdings Corporation in favor of JPMorgan Chase
    Bank, N.A.10
.5 «

$14,000,000 Revolving Credit Note, dated July 2, 2007, made
    by North Pointe Holdings Corporation in favor of Comerica Bank.10
.6 «

Stock Pledge Agreement, dated July 2, 2007, by and among
    Capital City Acquisition Corp. and Comerica Bank, as agent.10
.7 «

Security Agreement, dated July 2, 2007, by and among
    Capital City Acquisition Corp., Capital Collection Services,
    Inc., Capital City Holding Company, Inc., Davis-Garvin Holdings,
    Inc., Capital Excess & Surplus Brokers, Inc.,
    Southeastern Claims Services, Inc., Safeco Products, Inc., and
    Charter Premium Audits, Inc. and Comerica Bank, as agent.10
.8*+

Employment Agreement by and between North Pointe Holdings
    Corporation and James G. Petcoff, dated June 10, 2005.10
.9*+

North Pointe Holdings Corporation Annual Incentive Compensation
    Plan.10
.10

Intentionally Omitted.10
.11*+

Employment Agreement by and between North Pointe Holdings
    Corporation and B. Matthew Petcoff, dated June 10, 2005.10
.7*

Investment Advisory Agreement, dated July 6, 2004, between
    North Pointe Insurance Company and JPMorgan Investment Advisors
    Inc. (formerly Banc One Investment Advisors Corporation).10
.8*

Investment Advisory Agreement, dated September 13, 2004,
    between North Pointe Insurance Company and Munder Capital
    Management.10
.9 u

North Pointe Holdings Corporation Investment Policy and
    Guidelines Dated as of September 17, 2007.10
.10**

Second Amended and Restated Credit Agreement, dated as of
    June 30, 2006, by and among the lenders, Comerica Bank, as
    agent, and North Pointe Holdings Corporation.10
.11**

Amended and Restated Pledge Agreement, dated June 30, 2006,
    by and between North Pointe Holdings and Comerica Bank as agent.10
.12**

Third Amended and Restated Stock Pledge Agreement, dated
    June 30, 2006, by and between North Pointe Financial
    Services, Inc. and Comerica Bank as agent.10
.13**

Second Amended and Restated Security Agreement, dated as of
    June 30, 2006, by and among certain of North Pointe
    Holdings Corporations subsidiaries, and Comerica Bank as
    agent.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*+

Consulting Agreement, dated March 5, 2003, by and between
    North Pointe Insurance Company and LVM Company10
.17*+

Consulting Agreement dated September 30, 2005, by and
    between North Pointe Holdings Corporation and Joon Moon.10
.18+

Separation and Consulting Agreement dated January 3, 2008,
    by and between QBE Holdings, Inc., North Pointe Holdings
    Corporation and James G. Petcoff.10
.19*

Agreement between North Pointe Insurance Company and C.S.A.C.
    Agency dated May 30, 2000.10
.20*

Agency Agreement, dated June 1, 2004, by and between North
    Pointe Insurance Company and Amelia Underwriters, Inc.




---



##### 



Exhibit No

Description10
.21*

Agency Agreement, dated March 24, 2003, by and between
    North Pointe Insurance Company and Insurance Brokers of Indiana.10
.22*

Reinsurance and Indemnity Agreement, effective July 1,
    2003, by and between North Pointe Insurance Company and
    Universal Fire & Casualty.10
.23*

Agreement, dated December 3, 2002, by and between North
    Pointe Insurance Company and the Associated Food Dealers of
    Michigan.10
.24

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 and the Administrative
    Trustee dated as of February 22, 2006.10
.25

Guarantee Agreement between North Pointe Holdings Corporation a
    Guarantor and LaSalle Bank National Association as Guarantee
    Trustee dated February 22, 2006.10
.26

Purchase Agreement among North Pointe Holdings Corporation, NP
    Capital Trust I and Merrill Lynch International dated as of
    February 22, 2006.10
.27

Junior Subordinated Indenture between North Pointe Holdings
    Corporation and LaSalle Bank National Association as Trustee,
    Dated February 22, 2006.10
.28

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
.29

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
.30*

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.10
.31

Assumption of Mortgage Agreement for the Purchase Agreement
    regarding 28819 Franklin Road, Southfield, Michigan, 48034,
    dated August 18, 2005.10
.32

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.10
.33*

Investment Advisory Agreement, dated June 16, 2004, between
    North Pointe Casualty Insurance Company and JPMorgan Investment
    Advisors Inc. (formerly Banc One Investment Advisors
    Corporation).10
.34*

Investment Management Agreement, dated June 10, 2005,
    between JPMorgan Investment Advisors Inc. and Home Pointe
    Insurance Company.10
.35 ∆+

Form of stock option award.10
.36 ∆+

Form of restricted stock option award.10
.37+

First Amendment to the Employment Agreement by and between North
    Pointe Holdings Corporation and James G. Petcoff, dated
    January 1, 2007.10
.38+

First Amendment to the Employment Agreement by and between North
    Pointe Holdings Corporation and B. Matthew Petcoff, dated
    January 1, 2007.10
.39 5

Amendment to the Consulting Agreement by and between North
    Pointe Insurance Company and LVM Company, dated April 6,
    2006.10
.40 5

Managing General Agency Agreement by and between North Pointe
    Insurance Company and South Pointe Financial Services, Inc.,
    dated July 1, 2006.10
.41 5

Reinsurance Agreement by and between North Pointe Insurance
    Company and Midfield Insurance Company dated September 1,
    2006.10
.42 5

Reinsurance Agreement by and between North Pointe Insurance
    Company and Midfield Insurance Company dated January 1,
    2007.10
.43 5

Addendum Number 1 to Reinsurance Agreement by and between North
    Pointe Insurance Company and Midfield Insurance Company dated
    January 1, 2007.10
.44 5

Reinsurance Agreement by and between North Pointe Casualty
    Insurance Company and Midfield Insurance Company dated
    January 1, 2007.10
.45**

$10,000,000 Revolving Credit Note, dated as of June 30,
    2006, made by North Pointe Holdings Corporation in favor of
    Comerica Bank.




---



##### 



Exhibit No

Description10
.46**

$3,000,000 Swing Line Credit Note, dated June 30, 2006,
    made by North Pointe Holdings Corporation in favor of Comerica
    Bank.10
.47**

$7,500,000 Revolving Credit Note, dated June 30, 2006, made
    by North Pointe Holdings Corporation, in favor of Fifth Third
    Bank, with Comerica Bank as agent.10
.48**

$7,500,000 Revolving Credit Note, dated June 30, 2006, made
    by North Pointe Holdings Corporation, in favor of JP Morgan
    Chase Bank, N.A., with Comerica as agent.10
.49 n

Stock Purchase Agreement by and among Hinton G. Davis, HGD
    Investment LP, First Venture Holdings, L.L.C., Mary Teresa Davis
    Tanner, Hinton G. Davis III Grantor Trust, Susan Cheri
    Davis McMillan, Capital City Acquisition Corp., and North Pointe
    Holdings Corporation Relating to the Purchase and Sale of 100%
    of the Capital Stock of Capital City Holding Company, Inc.,
    Davis-Garvin Holdings, Inc., Capital Excess & Surplus
    Brokers, Inc., Southeastern Claims Services, Inc., Safeco
    Products, Inc., and Charter Premium Audits, Inc. Dated as of
    May 11, 2007.10
.50 n

First Amendment to the Stock Purchase Agreement by and among
    Hinton G. Davis, HGD Investment LP, First Venture Holdings,
    L.L.C., Mary Teresa Davis Tanner, Hinton G. Davis III
    Grantor Trust, Susan Cheri Davis McMillan, Capital City
    Acquisition Corp., and North Pointe Holdings Corporation
    Relating to the Purchase and Sale of 100% of the Capital Stock
    of Capital City Holding Company, Inc., Davis-Garvin Holdings,
    Inc., Capital Excess & Surplus Brokers, Inc.,
    Southeastern Claims Services, Inc., Safeco Products, Inc., and
    Charter Premium Audits, Inc. Dated as of July 2, 2007.10
.51 u

Stock Purchase Agreement by and among Safe Harbour Holdings,
    L.L.C., American Capital Assurance Corp., North Pointe Holdings
    Corporation and North Pointe Financial Services, Inc., Relating
    to the Purchase and Sale of 100% of the Capital Stock of Home
    Pointe Insurance Company Dated as of October 22, 2007.10
.52 ¡+

Agreement regarding Employment, by and between North Pointe
    Holdings Corporation and Brian J. Roney dated November 2,
    2007.10
.53

Amendment to the Consulting Agreement by and between North
    Pointe Insurance Company and LVM Company, dated
    September 7, 2007.10
.54¥

Agreement and Plan of Merger dated as of January 3, 2008
    among North Pointe Holdings Corporation, Noble Acquisition
    Corporation and QBE Holdings, Inc.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 pursuant to
    18 U.S.C. Section 1350 and
    Rule 13a-14(b)
    under the Securities Exchange Act of 1934.32
.2

Certification of 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 with the Registration Statement on
    Form S-1
    dated September 23, 2005.
    
    Previously filed with the
    Form 10-K
    for the year ended December 31, 2005.**
    
    Previously filed with the
    Form 10-Q
    for the quarter ended June 30, 2006.∆
    
    Previously filed with the
    Form 10-Q
    for the quarter ended September 30, 2005.5
    
    Previously filed with
    Form 10-K
    for the year ended December 31, 2006n
    
    Previously filed with
    Form 10-Q
    for the quarter ended June 30, 2007.u
    
    Previously filed with
    Form 10-Q
    for the quarter ended September 30, 2007.▼
    
    Previously filed with
    Form 8-K
    filed on January 8, 2008.¥
    
    Previously filed with DEF14A Proxy Filings filed on
    January 9, 2008 and March 7, 2008.¡
    
    Previously filed with
    Form 8-K
    filed on January 16, 2008.+
    
    Compensatory plan or arrangement.