Argonaut Group Acquires Renewal Rights of Fireman's Fund Binding Authority Business

SAN ANTONIO--()--April 1, 2005--Argonaut Group, Inc. (NASDAQ:AGII) announced today that it has reached an agreement with Fireman's Fund Insurance Company to acquire the renewal rights and certain operating assets of the Binding Authority business segment, currently underwritten by Interstate Insurance Group, a subsidiary of Fireman's Fund.

Argonaut Group, through its Excess and Surplus (E&S) segment, Colony, will begin offering policies to the Binding Authority customers for transportation and other E&S business. Based in Richmond, VA, Colony underwrites difficult risks not serviced by standard carriers and focuses on small to medium-sized businesses in a wide variety of industries and professions.

Argonaut Group President and Chief Executive Officer, Mark E. Watson III, commented, "We continue to look for high-value opportunities to provide more predictable growth and expand our presence within our niche markets. This transaction furthers those goals in our E&S segment."

"The Binding Authority business model, while profitable, is not a long-term strategic fit for Fireman's Fund," said Arthur E. Moossmann, president of Specialty Insurance for Fireman's Fund. "The transfer of this book of business to Argonaut will allow our Specialty Insurance business to concentrate on the specialized underwriting focus of its marine and casualty products, delivered through focused distribution channels."

Colony president, Dale Pilkington, added, "Because the Binding Authority segment of Fireman's Fund is recognized as an experienced and profitable underwriter of E&S transportation business, the addition of this segment will complement our existing array of specialty products."

ABOUT ARGONAUT GROUP, INC.

Headquartered in San Antonio, Argonaut Group, Inc. (NASDAQ:AGII) is a national underwriter of specialty insurance products in niche areas of the property and casualty market with assets of approximately $3.1 billion. Through its operating subsidiaries, Argonaut Group offers high quality customer service in programs tailored to the needs of its customers' business and risk management strategies. Collectively, Colony Group, Rockwood Casualty Group, Argonaut Insurance Company, Great Central Insurance, Grocers Insurance, and Trident Insurance Services underwrite a full line of products in four primary areas: Excess and Surplus, Specialty Commercial, Risk Management, and Public Entity. Information on Argonaut Group and its subsidiaries is available at www.argonautgroup.com.

ABOUT FIREMAN'S FUND

Headquartered in Novato, Calif., Fireman's Fund is a premier, national property casualty insurer that has pioneered many innovative insurance programs during its 142-year history. Rated "A" by the independent A.M. Best Company, Fireman's Fund last year had gross premiums written of $4.9 billion. The Company provides personal, commercial, marine, excess and surplus lines and agribusiness insurance products nationwide. Fireman's Fund is a member of the Allianz Group, one of the world's largest providers of financial services.

Contacts

Argonaut Group, Inc., San Antonio
Media Contacts:
Julie Ring, 210-321-8516
jring@argonautgroup.com
or
Fireman's Fund Insurance Company
John Kozero, 415-899-2166
jkozero@ffic.com

Contacts

Argonaut Group, Inc., San Antonio
Media Contacts:
Julie Ring, 210-321-8516
jring@argonautgroup.com
or
Fireman's Fund Insurance Company
John Kozero, 415-899-2166
jkozero@ffic.com