Exhibit 8



March 30, 2001


CII Financial, Inc.
2716 North Tenaya Way
Las Vegas, NV 89128


Re: Registration Statement on Form S-4, File No. 333-52726

Ladies and Gentlemen:

                  We have acted as  special  United  States  tax  counsel to CII
Financial,  Inc., a  corporation  organized  under the laws of  California  (the
"Company"),   in  connection  with  the  preparation  of  the  above  referenced
Registration Statement (the "Registration Statement"),  relating to the exchange
of old junior  subordinated  debentures  of the  Company for cash and new senior
debentures of the Company (the "Exchange Offer").

                  Capitalized terms used herein and not otherwise defined herein
have  the  respective  meanings  ascribed  to those  terms  in the  Registration
Statement.

                  In arriving at the opinion referred to below, we have examined
the Registration  Statement,  including the Exhibits thereto.  We have also read
and relied upon  originals or copies,  certified or otherwise  identified to our
satisfaction,  of  such  records  of  the  Company  and  such  certificates  and
representations of officers and  representatives of the Company and we have made
such  investigations  of law as we have  deemed  appropriate  as a basis for the
opinion referred to below. In our examination,  we have assumed the authenticity
of original documents, the accuracy of copies and the genuineness of signatures.
We understand and assume that (i) each agreement referred to in the Registration
Statement  represents the valid and binding obligation of the respective parties
thereto,  enforceable in accordance  with its respective  terms,  and the entire
agreement  between the parties with respect to the subject matter thereof,  (ii)
the parties to each agreement have complied,  and will comply, with all of their
respective  covenants,  agreements and undertakings  contained therein and (iii)
the transactions  provided for by each agreement were and will be carried out in
accordance with their terms.

                  Our  opinion  is based upon  existing  United  States  federal
income  tax  laws,  regulations,   administrative  pronouncements  and  judicial
decisions.  All such authorities are subject to change,  either prospectively or
retroactively.  No assurance can be provided as to the effect of any such change
upon our opinion.

                  Our  opinion  has  no  binding  effect  on the  United  States
Internal Revenue Service or the courts of the United States. No assurance can be
given that, if the matter were contested, a court would agree with our opinion.

                  We have  advised the Company in  connection  with the material
United States federal income tax  consequences  to the Company and United States
holders of the Exchange Offer and to United States  holders of the  acquisition,
ownership  and  disposition  of new senior  debentures,  and we confirm that the
statements of law and legal conclusions contained in the Registration  Statement
under the caption  "Material United States Federal Income Tax  Consequences" are
our opinion.  While our opinion discusses the material anticipated United States
federal income tax consequences  applicable to certain United States holders, it
does not purport to discuss all United States tax consequences and is limited to
those United States tax consequences specifically discussed therein.

                  In giving our opinion,  we express no opinion other than as to
the federal income tax law of the United States of America.

                  We are  furnishing  this  letter in our  capacity  as  special
United  States  tax  counsel  to the  Company.  This  letter  is not to be used,
circulated, quoted or otherwise referred to for any other purpose, except as set
forth below.

                  We hereby  consent to the filing of this  letter as an Exhibit
to the  Registration  Statement  and we  further  consent to the use of our name
under the caption  "Material  United States Federal Income Tax  Consequences" in
the Registration Statement. In giving this consent, we do not thereby admit that
we are within the category of persons whose consent is required to be filed with
the  Registration  Statement  under the  provisions of the Securities Act or the
rules and regulations promulgated thereunder.

Very truly yours,

/s/ Morgan, Lewis & Bockius LLP