Tuesday, November 11, 2008 Valued Producers: As many of you have seen and heard there has been a great deal of activity at Heath XS. On August 29th 2008 we partnered with Hallmark Financial Services, Inc. by selling 80% of Heath XS, LLC and 80% Hardscrabble Data Solutions, LLC in order to help us attain our goals for the upcoming years. While this partnership will help us to introduce new products with American Hallmark Insurance Company we will continue to maintain our long standing relationship with ACE for our core Excess Transportation Program which is now beginning its ninth year. We have also been thrown into a very different and turbulent economic environment which is no doubt to have an impact on our business. We have not yet seen the outcome for AIG and its insurance subsidiaries but we do see turbulence and concern in the marketplace. We are very fortunate to be representing two very strong carriers who are not exposed to the current credit issues. We will continue to offer admitted paper wherever possible and as we move forward with Hallmark we will have admitted paper as well. As we enter into our ninth year with ACE and our Excess Transportation Program, we are faced with making some very critical underwriting decisions. Historically we have been an excellent market for smaller to medium size transportation risks which usually purchase one or two million in limits. But during the past few years we have increased our limits and our overall fleet exposure which has created increased claims activity in certain areas So rather than risk a deterioration in what has been an excellent program we have decided to bring our limits back to $2,000,000 and focus on fleets up to 200 units effective 11/1/2008. While we realize this will be difficult for some of you it is in the best interest for the continued success of this program as well as the positive introduction of new Programs. With these changes we will continue to provide you with the best service for your middle market trucking, specialty auto and petroleum accounts. Thank you for your continued support during this time of turmoil in the marketplace. We will do our best to keep you advised of our new products and any other changes in the future. If you have any ideas or see opportunities for new Products, please give us a call to discuss. These changes will be effective on new and renewal policies. Jeff Heath President Phone: 908.766.7140 Fax: 908.766.4419 Mobile: 908.295.1763 Toll-Free: 800.524.3284 Guidelines: TRUCK FOR HIRE: Local, intermediate and long haul truckers Contract Carriers LTL Carriers Fleets up to 200 Units $2,000,000 available limits A+ XV Carrier Admitted and Non Admitted HAZ MAT: Gasoline Hauling & Distribution Fuel Oil Hauling & Distribution LPG Hauling & Distribution C-Store Operation with Petro Fuel Oil Dealers & Distributors Fleets up to 200 Units $2,000,000 Available Limits A+ XV Carrier Admitted and Non Admitted Filings Provided SPECIALTY AUTO: Refuse Haulers Ready Mix Operations Moving & Storage Auto Carriers Contractors Fleets Sand & Gravel Operations Delivery Services Couriers Tow Truck Operations, no repo Ag Haulers Fleets up to 200 Units $2,000,000 Available Limits A+ XV Carrier Admitted and Non Admitted Underwriters: Jim Damonte ext. 107 jdamonte@heathxs.com Alex Leong ext 121 aleong@heathxs.com Andrew Stock ext 110 astock@heathxs.com Mark Grossberg ext 104 mgrossberg@heathxs.com Jeff Heath ext 103 jheath@heathxs.com Alexis Damonte ext 109 adamonte@heathxs.com