<ARTICLE> 7
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE FINANCIAL STATEMENTS IN THE RLI CORP. FORM 10Q FOR THE PERIOD
ENDED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-1996
<PERIOD-END>                               SEP-30-1996
<DEBT-HELD-FOR-SALE>                            46,395
<DEBT-CARRYING-VALUE>                          262,340
<DEBT-MARKET-VALUE>                            262,634
<EQUITIES>                                     175,340
<MORTGAGE>                                           0
<REAL-ESTATE>                                        0
<TOTAL-INVEST>                                 495,262
<CASH>                                               0
<RECOVER-REINSURE>                              63,858
<DEFERRED-ACQUISITION>                          16,565
<TOTAL-ASSETS>                                 836,640
<POLICY-LOSSES>                                238,084
<UNEARNED-PREMIUMS>                            129,844
<POLICY-OTHER>                                       0
<POLICY-HOLDER-FUNDS>                                0
<NOTES-PAYABLE>                                 47,600
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                         8,453
<OTHER-SE>                                     178,968
<TOTAL-LIABILITY-AND-EQUITY>                   836,640
<PREMIUMS>                                      96,852
<INVESTMENT-INCOME>                             17,639
<INVESTMENT-GAINS>                                 142
<OTHER-INCOME>                                  27,278
<BENEFITS>                                      51,244
<UNDERWRITING-AMORTIZATION>                     22,953
<UNDERWRITING-OTHER>                            11,143
<INCOME-PRETAX>                                 26,017
<INCOME-TAX>                                     7,322
<INCOME-CONTINUING>                             18,695
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    18,695
<EPS-PRIMARY>                                     2.36
<EPS-DILUTED>                                     2.08
<RESERVE-OPEN>                                       0
<PROVISION-CURRENT>                                  0
<PROVISION-PRIOR>                                    0
<PAYMENTS-CURRENT>                                   0
<PAYMENTS-PRIOR>                                     0
<RESERVE-CLOSE>                                      0
<CUMULATIVE-DEFICIENCY>                              0