UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004

FORM 10-Q

Mark One
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2003

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

For the transition period from _________ to ____________

Commission File Number: 0-29042

SYMONS INTERNATIONAL GROUP, INC.
(Exact name of registrant as specified in its charter)

INDIANA 35-1707115
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

4720 Kingsway Drive
Indianapolis, Indiana 46205
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (317) 259-6300

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

The number of shares of common stock of the Registrant, without par value,
outstanding as of June 30, 2003 was 10,385,399.

FORM 10-Q INDEX

Page
Number

PART I FINANCIAL INFORMATION

Item 1 Financial Statements

Consolidated Balance Sheets at March 31, 2003
(unaudited) and December 31, 2002 3

Unaudited Consolidated Statements of Operations
for the Three Months Ended March 31, 2003 and 2002 4

Unaudited Consolidated Statements of Cash Flows for the
Three Months Ended March 31, 2003 and 2002 5

Condensed Notes to Unaudited Consolidated Financial
Statements . . . . . . . . . 6

Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 13

Item 3. Quantitative and Qualitative Disclosures about Market Risk 18

PART II OTHER INFORMATION 18

Item 1 . Legal Proceedings 18

Item 2. Changes in Securities and Use of Proceeds 20

Item 3. Defaults Upon Senior Securities 20

Item 4. Submission of Matters to a Vote of Security Holders 20

Item 5. Other Information 20

Item 6. Exhibits and Reports on Form 8-K 20

SIGNATURES 21

CERTIFICATION 22

PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SYMONS INTERNATIONAL GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
March 31,
2003 December 31,
(Unaudited) 2002
------------ ----------

ASSETS
Investments available for sale:
Fixed maturities, at market . . . . . . . . . . . . . . . . . . . . $ 26,479 $ 36,728
Equity securities, at market. . . . . . . . . . . . . . . . . . . . 4,802 6,404
Short-term investments, at amortized cost,
which approximates market. 8,182 8,495
Other invested assets . . . . . . . . . . . . . . . . . . . . . . . 2,977 3,046
----------- --------------
Total investments . . . . . . . . . . . . . . . . . . . . . . . . . 42,440 54,673
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . 2,096 654
Receivables, net of allowance of $677 and $244, respectively. . . . 28,887 26,594
Reinsurance recoverable on paid and unpaid losses . . . . . . . . . . 27,344 25,918
Prepaid insurance premiums. . . . . . . . . . . . . . . . . . . . . 28,292 25,470
Property and equipment, net of accumulated depreciation . . . . . . 6,333 7,069
Deferred securities issuance costs. . . . . . . . . . . . . . . . . 4,161 4,204
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,464 3,490
----------- --------------
Total Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 142,017 $ 148,072
=========== ==============

LIABILITIES AND SHAREHOLDERS' (DEFICIT)
Liabilities:
Loss and loss adjustment expense reserves . . . . . . . . . . . . . $ 63,589 $ 67,204
Unearned premiums . . . . . . . . . . . . . . . . . . . . . . . . . 39,298 35,797
Reinsurance payables. . . . . . . . . . . . . . . . . . . . . . . . 12,502 17,171
Distributions payable on preferred securities . . . . . . . . . . . 53,364 49,227
Deferred income . . . . . . . . . . . . . . . . . . . . . . . . . . 1,750 2,125
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 15,276 13,827
Advance from related parties. . . . . . . . . . . . . . . . . . . . 1,870 2,687
Net liabilities of discontinued operations. . . . . . . . . . . . . 4,151 3,913
----------- --------------
Total Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 191,800 191,951
----------- --------------
Minority interest:
Company-obligated mandatorily redeemable preferred stock of trust
subsidiary holding solely parent debentures . . . . . . .. . . . . 135,000 135,000
----------- --------------
Shareholders' deficit:
Common stock, no par value, 100,000,000 shares authorized,
10,385,399 shares issued and outstanding in both 2003 and 2002. . 38,136 38,136
Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . 5,851 5,851
Unrealized loss on investments available for sale . . . . . . . . . (3,117) (2,220)
Retained deficit. . . . . . . . . . . . . . . . . . . . . . . . . . (225,653) (220,646)
----------- --------------
Total Shareholders' deficit . . . . . . . . . . . . . . . . . . . . . (184,783) (178,879)
----------- --------------
Total Liabilities and Shareholders' deficit . . . . . . . . . . . . . $ 142,017 $ 148,072
=========== ==============
<FN>

See condensed notes to consolidated financial statements.

SYMONS INTERNATIONAL GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended
March 31
2003 2002
-------------------- ---------

Gross premiums written . . . . . . . . . . . . . . . . . . . . . . . . . . $ 27,890 $ 43,755
Less ceded premiums. . . . . . . . . . . . . . . . . . . . . . . . . . . . (20,949) (30,973)
-------------------- ---------
Net premiums written . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,941 $ 12,782
==================== =========
Net premiums earned. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,134 $ 11,766
Fee income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,536 2,643
Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 375 375
Net investment income. . . . . . . . . . . . . . . . . . . . . . . . . . . 282 1,244
Net realized capital gain (loss) . . . . . . . . . . . . . . . . . . . . . 245 (748)
-------------------- ---------
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,572 15,280
-------------------- ---------
Expenses:
Losses and loss adjustment expenses. . . . . . . . . . . . . . . . . . . 5,527 12,671
Policy acquisition and general and administrative expenses . . . . . . . 4,830 6,459
Interest expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 -
Amortization of deferred financing costs . . . . . . . . . . . . . . . . 43 43
-------------------- ---------
Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,442 19,173
-------------------- ---------
Loss from continuing operations before income taxes and minority interest. (870) (3,893)
-------------------- ---------
Total income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . - -
-------------------- ---------
Loss from continuing operations before minority interest . . . . . . . . . (870) (3,893)
-------------------- ---------
Minority interest:

Distributions on preferred securities, net of tax of nil in. . . . . . .
. both 2003 and 2002. 4,137 3,836
---------- ------
Loss from continuing operations. . . . . . . . . . . . . . . . . . . . . . (5,007) (7,729)

Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (5,007) $ (7,729)
==================== =========
Weighted average shares outstanding - basic and fully diluted. . . . . . . 10,385 10,385
==================== =========
Net loss from continuing operations per share - basic and fully diluted. . $ (0.48) $ (0.74)
==================== =========
Net loss of discontinued operations per share-basic and fully diluted. . . $ - $ -
==================== =========
Net loss per share - basic and fully diluted . . . . . . . . . . . . . . . $ (0.48) $ (0.74)
==================== =========
<FN>
See condensed notes to consolidated financial statements.

SYMONS INTERNATIONAL GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended
March 31
--------------------
2003 2002
-------------------- --------

Cash flows from operating activities:
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . $ (5,007) $(7,729)
Adjustments to reconcile net loss to net cash provided
by (used in) operations:
Depreciation, amortization, impairment and other. . . . 971 911
Net realized capital (Gain) loss. . . . . . . . . . . . . . (245) 748
Net changes in operating assets and liabilities:
Receivables . . . . . . . . . . . . . . . . . . . . . . (2,294) (5,653)
Reinsurance recoverable on losses, net. . . . . . . . . (1,426) (4,115)
Prepaid reinsurance premiums. . . . . . . . . . . . . . (2,822) (3,892)
Deferred policy acquisition costs . . . . . . . . . . . - (160)
Loss and loss adjustment expense reserves . . . . . . . (3,616) (3,072)
Unearned premiums . . . . . . . . . . . . . . . . . . . 3,501 5,046
Reinsurance payables. . . . . . . . . . . . . . . . . . (4,669) 5,558
Distribution payable on preferred securities. . . . . . 4,137 3,836
Other assets and liabilities. . . . . . . . . . . . . . 2,102 3,120
Net assets / (liabilities) from discontinued operations. . . 102 (1,327)
-------------------- --------
Net cash (used in) operations . . . . . . . . . . . . . . . . (9,266) (6,729)
-------------------- --------

Cash flows from investing activities, net of assets acquired:
Net sales of short-term investments . . . . . . . . . . . . . 313 2,917
Proceeds from sales, calls and maturities of fixed maturities 10,102 7,356
Purchase of fixed maturities. . . . . . . . . . . . . . . . . (409) (4,293)
Proceeds from sales of equity securities. . . . . . . . . . . 1,478 4,796
Purchase of equity securities . . . . . . . . . . . . . . . . - (562)
Purchase of property and equipment. . . . . . . . . . . . . . (85) (121)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10) -
Net investing activities from discontinued operations . . . . 136 1,434
-------------------- --------
Net cash provided by investing activities . . . . . . . . . . 11,525 11,527
-------------------- --------

Cash flows from financing activities, net of assets acquired:
Loans from and (repayment to) related parties . . . . . . . . (817) (125)
Net financing activities from discontinued operations . . . . - (107)
-------------------- --------
Net cash (used in) financing activities . . . . . . . . . . . (817) (232)
-------------------- --------
Increase in cash and cash equivalents . . . . . . . . . . . . 1,442 4,566
Cash and cash equivalents, beginning of period. . . . . . . . 654 3,385
-------------------- --------
Cash and cash equivalents, end of period. . . . . . . . . . . $ 2,096 $ 7,951
==================== ========
<FN>
See condensed notes to consolidated financial statements.

SYMONS INTERNATIONAL GROUP, INC.
CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
For the Three Months Ended March 31, 2003

1. OVERVIEW OF THE COMPANY AND BASIS OF PRESENTATION

Symons International Group, Inc. (the "Company") owns insurance companies that
underwrite and market nonstandard private passenger automobile insurance. The
Company's principal insurance company subsidiaries are Pafco General Insurance
Company ("Pafco") and Superior Insurance Company ("Superior"). The Company is a
73.8% owned subsidiary of Goran Capital Inc. ("Goran").

The parent company of Pafco and Superior is Superior Insurance Group, Inc.
("Superior Group"). Pafco, Superior and Superior's subsidiaries, Superior
Guaranty Insurance Company ("Superior Guaranty") and Superior American Insurance
Company ("Superior American"), are engaged in the writing of insurance coverage
for automobile physical damage and liability policies for nonstandard risks.
Nonstandard risk insureds are those individuals who are unable to obtain
insurance coverage through standard market carriers due to factors such as poor
premium payment history, driving experience or violations, occupation or type of
vehicle. The Company offers several different policies that are directed towards
different classes of risk within the nonstandard market. Premium rates for
nonstandard risks are higher than for standard risks. Since it can be viewed as
a residual market, the size of the nonstandard private passenger automobile
insurance market changes with the insurance environment and grows when standard
coverage becomes more restrictive. Nonstandard policies have relatively short
policy periods and low limits of liability. Also, since the nonstandard
automobile insurance business typically experiences lower rates of retention
than standard automobile insurance, the number of new policyholders underwritten
by nonstandard automobile insurance carriers each year is substantially greater
than the number of new policyholders underwritten by standard carriers.

As previously announced, the Company sold its crop insurance operations to
Acceptance Insurance Companies Inc. ("Acceptance") on June 6, 2001. The crop
insurance business was written through the Company's wholly owned subsidiary,
IGF Insurance Company ("IGF"), which is in runoff. Accordingly, the financial
statements included in this report reflect the results of the crop insurance
segment as "discontinued operations".

The financial statements included in this report are the consolidated financial
statements of the Company and its subsidiaries. The consolidated financial
statements have been prepared pursuant to the rules and regulations of the
Securities and Exchange Commission ("SEC"). In management's opinion, these
financial statements include all adjustments (consisting only of normal,
recurring adjustments) necessary for a fair presentation of the results of
operations for the interim periods presented. Pursuant to SEC rules and
regulations, certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted from these statements, unless
significant changes have taken place since the end of the most recent fiscal
year. For this reason, the accompanying consolidated financial statements and
notes thereto should be read in conjunction with the financial statements and
notes for the year ended December 31, 2002 included in the Company's 2002 Annual
Report on Form 10-K. Results for any interim period are not necessarily
indicative of results to be expected for the year.

2. PREFERRED SECURITIES

On August 12, 1997, the Company issued through a wholly owned trust subsidiary
$135 million aggregate principal amount in trust originated preferred securities
(the "Preferred Securities"). The Preferred Securities have a term of 30 years
with semi-annual interest payments of $6.4 million that commenced February 15,
1998. The Company may redeem the Preferred Securities in whole or in part 10
years after the issue date.

The Company elected to defer the semi-annual interest payments due in February
and August 2000, 2001, and 2002 and expects to continue this practice through
2003 and 2004. The payment due in February 2003 was deferred. The unpaid
interest installment amounts accrue interest at 9.5%.

The Company may continue to defer semi-annual interest payments for up to an
aggregate of five (5) years as permitted by the indenture for the Preferred
Securities. All of the deferred interest (approximately $84 million, if all
payments due in 2003 and 2004 are deferred) will become due and payable in
February 2005 along with the semi-annual interest due at that time. The Company
relies on the payment of finance and service fees by its subsidiaries to fund
its operations, including its payment of interest on the Preferred Securities.
Certain state regulators, including the Florida Department of Insurance
("FDOI"), have issued orders prohibiting the Company's subsidiaries from paying
such fees to the Company. There can be no assurance that the Company will
sufficient revenue to fund its operations and pay the deferred interest on the
Preferred Securities. Such failure to pay could result in a default under the
indenture and acceleration of the payment of the Preferred Securities.

The trust indenture contains certain restrictive covenants based upon the
Company's consolidated coverage ratio of earnings before interest, taxes,
depreciation and amortization (EBITDA). If the Company's EBITDA falls below 2.5
times consolidated interest expense (including Preferred Securities
distributions) for the most recent four quarters, the following restrictions
become effective:

- - The Company may not incur additional indebtedness or guarantee additional
indebtedness.
- - The Company may not make certain restricted payments including making loans
or advances to affiliates, repurchasing common stock or paying dividends in
excess of a stated limitation.
- - The Company may not increase its level of non-investment grade securities
defined as equities, mortgage loans, real estate, real estate loans and
non-investment grade, fixed income securities.

These restrictions currently apply, as the Company's consolidated coverage ratio
was (0.42) at March 31, 2003, and will continue to apply until the Company's
consolidated coverage ratio complies with the terms of the trust indenture. The
Company complied with these additional restrictions as of December 31, 2001 and
2002 and is in compliance as of July 1, 2003.

3. REGULATORY ACTIONS

On June 6, 2001, IGF sold substantially all of its crop insurance assets to
Acceptance. On June 24, 2001, following the sale of IGF's crop insurance assets
and as a result of losses experienced by IGF in its crop insurance operations,
the IDOI and IGF entered into a consent order (the "Consent Order") relating to
IGF. IGF has discontinued writing new business and its operations are presently
in run off. The IDOI has continued to monitor the status of IGF. The Consent
Order prohibits IGF from taking any of the following actions without prior
written consent of the IDOI:

- - Sell or encumber any of its assets, property, or business in force;
- - Disburse funds, except to pay direct unaffiliated policyholder claims and
normal operating expenses in the ordinary course of business (which does
not include payments to affiliates except for the reimbursement of costs of
running IGF by the Company, and does not include payments in excess of
$10,000);
- - Lend its funds or make investments, except in specified types of
investments;
- - Incur debts or obligations, except in the ordinary course of business to
unaffiliated parties;
- - Merge or consolidate with another company;
- - Enter into new, or amend existing, reinsurance agreements;
- - Complete, enter into or amend any transaction or arrangement with an
affiliate, and
- - Disburse funds or assets to any affiliate.

The Consent Order also requires IGF to provide the IDOI with monthly written
updates and immediate notice of any material change regarding the status of
litigation with Continental Casualty Company, statutory reserves, number of
non-standard automobile insurance policies in-force by state, and reports of all
non-claims related disbursements. IGF's failure to comply with the Consent
Order could cause the IDOI to begin proceedings to have a rehabilitator or
liquidator appointed for IGF or to extend the provisions of the Consent Order.
IGF is in regular ongoing contact with the IDOI regarding it financial
condition.

Pafco has been subject to an agreed order of the IDOI since February 17, 2000
that requires Pafco, among other matters, to:

- - Refrain from doing any of the following without the IDOI's prior written
consent:
- Selling assets or business in force or transferring property, except
in the ordinary course of business;
- Disbursing funds, other than for specified purposes or for normal
operating expenses and in the ordinary course of business (which does
not include payments to affiliates, other than under written contracts
previously approved by the IDOI, and does not include payments in
excess of $10,000);
- Lending funds;
- Making investments, except in specified types of investments;
- Incurring debt, except in the ordinary course of business and to
unaffiliated parties;
- Merging or consolidating with another company; or
- Entering into new, or modifying existing, reinsurance contracts.
- - Reduce its monthly auto premium writings, or obtain additional statutory
capital or surplus, such that the ratio of gross written premium to surplus
and net written premium to surplus does not exceed 4.0 and 2.4,
respectively; and provide the IDOI with regular reports demonstrating
compliance with these monthly writings limitations.
- - Continue to comply with prior IDOI agreements and orders to correct
business practices under which Pafco must provide monthly financial
statements to the IDOI, obtain prior IDOI approval of reinsurance
arrangements and affiliated party transactions, submit business plans to
the IDOI that address levels of surplus and net premiums written, and
consult with the IDOI on a monthly basis.

Pafco's inability or failure to comply with any of the above conditions could
result in the IDOI requiring further reductions in Pafco's permitted premium
writings or in the IDOI instituting future proceedings against Pafco.
Restrictions on premium writings result in lower premium volume. Management fees
payable to Superior Group are based on gross written premium; therefore, lower
premium volume results in reduced management fees paid by Pafco to Superior
Group. Pafco is in regular contact with the IDOI regarding its financial
condition.

At March 31, 2003, Pafco's gross written premium to surplus and net written
premium to surplus exceeded the ratios allowed under the agreed order. The
Company has reduced written premium and will be in compliance at December 31,
2003. Pafco has agreed with the IDOI to maintain its surplus above $2.5 million
through August 2003.

In March 2000, Pafco agreed with the Iowa Department of Insurance ("IADOI") that
it would not write any new non-standard business in Iowa, until such time as
Pafco has reduced its overall non-standard automobile policy counts in the state
or has:

- - Increased surplus; or
- - Has achieved a net written premium to surplus ratio of less than three to
one; or
- - Has surplus reasonable to its risk.

Pafco has continued to service existing policyholders and renew policies in Iowa
and provide policy count information on a monthly basis in conformance with
IADOI requirements.

On June 30, 2003 the Missouri Department of Insurance instituted proceedings to
suspend Pafco's certificate of authority in Missouri. Pafco had previously
stopped writing new business in Missouri and is in contact with the Missouri
Department of Insurance to identify an alternative to the pending proceeding.

Superior and Pafco provide monthly financial information to the departments of
insurance in certain states in which they write business at the states' request.

On July 7, 2000, the FDOI issued a notice of its intent to issue an order (the
"Notice") which principally addressed certain policy and finance fee payments by
Superior to Superior Group. A formal administrative hearing to review the
Notice and a determination that the order contemplated by the Notice not be
issued was held in February 2001. The administrative law judge entered a
recommended order on June 1, 2001 that was acceptable to the Company. On August
30, 2001, the FDOI rejected the recommended order and issued its final order
which the Company believes improperly characterized billing and policy fees paid
by Superior to Superior Group. On September 28, 2001, Superior filed an appeal
of the final order to the Florida District Court of Appeal. On March 4, 2002,
the FDOI filed a petition in the Circuit Court of the Second Judicial Circuit in
and for Leon County, Florida seeking court enforcement of the FDOI's final
order. Superior filed a motion with the FDOI for stay of the FDOI's final order.
Superior also filed a motion for stay with the District Court of Appeal, which
was denied pending a ruling from the FDOI. On April 5, 2002 the FDOI granted a
stay of the final order that was conditional upon the cessation of the payment
of billing fees by Superior to Superior Group and the posting of a $15 million
appeal bond. Superior did not agree to the conditions imposed by the FDOI's
conditional stay. On May 6, 2002 Superior filed a motion with the District
Court of Appeal seeking a stay of the final order pending Superior's appeal or,
in the alternative, a consolidation of the FDOI's enforcement action with the
pending appeal. On June 19, 2002, the District Court of Appeal entered an order
which struck the FDOI's conditional requirement for the stay that Superior post
a $15 million appeal bond. However, the order denied Superior's request to
consolidate the appeal with the enforcement action. On September 26, 2002, the
District Court of Appeal affirmed the final order of the FDOI. On October 31,
2002 the Circuit Court entered a final order which granted the FDOI's petition
for enforcement of the FDOI's final order and which requires Superior to comply
with the FDOI final order.

In accordance with the FDOI's final order, Superior ceased payment of finance
and service fees as of October 1, 2002 and has requested repayment from Superior
Group of $15 million of finance and service fees paid from 1997 through 1999 and
additional finance and service fees paid thereafter in the approximate amount of
$20 million. Without the payment of finance and service fee income to Superior
Group or an amendment to the management agreement or reallocation of operational
responsibilities, Superior Group could not operate profitably. Accordingly, on
October 1, 2002, Superior Group discontinued the provision of certain claims
services to Superior. Superior provided a number of proposals to the FDOI in an
effort to establish an acceptable repayment plan in accordance with the final
order. None of the proposals were acceptable to the FDOI.

On March 21, 2003 the FDOI filed a Motion for Enforcement of Final Order
Granting Petition to Enforce Agency Action (the"Motion for Enforcement") in the
Circuit Court which seeks to hold Superior in contempt for failing to obtain the
immediate repayment of approximately $15 million from Superior Group. Superior
Group presently does not have the ability to make a $15 million repayment, and
Superior believes that this petition seeks to fashion a remedy not intended by
the Circuit Court's November 1, 2002 order and contravenes the spirit of
numerous discussion between the FDOI and Superior to resolve the issues during
the pendency of Superior's appeal to the District Court of Appeal and the
original enforcement action. On May 7, 2003 a hearing was held on the Motion
for Enforcement, and an order has not yet been issued.

On September 10, 2002, the FDOI filed a petition in the Circuit Court of the
Second Judicial Circuit in and for Leon County, Florida for an order to show
cause and notice of automatic stay which sought the appointment of a receiver
for the purpose of rehabilitation of Superior. The court entered an order to
show cause, temporary injunction and notice of automatic stay on September 13,
2002 and a hearing was held on October 24, 2002. On November 1, 2002, the court
entered an order that denied the FDOI's petition for appointment of a receiver.
On November 8, 2002, the FDOI filed a motion for rehearing, which was denied on
December 17, 2002.

On November 20, 2002, the FDOI issued a notice and order to show cause which
seeks to suspend or revoke Superior's certificate of authority principally based
upon allegations that Superior did not comply with the FDOI's August 30, 2001
final order during the pendency of the appeal of the order to the District Court
of Appeal. Superior believes that it has fully and timely complied with the
final order and that the action brought by the FDOI is barred by res judicata.
A formal administrative hearing to review the notice and a determination that
the order or administrative action contemplated by the notice not be issued was
held in May 2003. A recommended order has not been issued, which the FDOI may
accept or reject.

The FDOI has engaged an actuary to perform a review of Superior's reserves as of
May 31, 2003.

On October 9, 2001, the State Corporation Commission of Virginia ("Virginia
Commission") issued an order to take notice regarding an order suspending
Superior's license to write business in that state. An administrative hearing
for a determination that the suspension order not be issued was held March 5,
2002. On May 3, 2002, the hearing examiner issued his report and recommended
that Superior's license not be suspended and that Superior file its risk based
capital plans and monthly and quarterly financial information with the Virginia
Bureau of Insurance ("Bureau"). On June 19, 2002 the Virginia Commission
entered an order which adopted the findings of the hearing examiner, continued
the matter until such time as the Bureau requests further action and requires
the continued monitoring of the financial condition of Superior by the Bureau.
On October 11, 2002, the Virginia Commission filed an administrative Rule to
Show Cause. A hearing was scheduled for November 18, 2002 to determine whether
Superior's license to transact insurance business in Virginia should be
suspended. The Virginia Commission continued the hearing indefinitely.
Superior has provided additional financial information to and continues to be in
contact with the Virginia Commission. On July 10, 2003, the Virginia Commission
entered an order which directs Superior to stop writing business in Virginia
until its surplus is at least $3 million. Although Superior's unaudited surplus
as of May 31, 2003 is above $3 million, the order also requires Superior to
provide the Virginia Commission with an interim audited financial statement.
Superior anticipates that it will meet the conditions set forth in the order
prior to July 31, 2003. The nonstandard automobile insurance policies written in
Virginia by Superior accounted for approximately 16.0% and 14.5% of the total
gross written premiums of the Company through March 31,2003 and December 31,
2002, respectively.

On April 21, 2003 the Alabama Department of Insurance issued an order to show
cause for suspension of Superior's certificate of authority in Alabama due to
the decline in Superior's surplus. Superior is in communication with and
providing additional financial information to the Alabama Department of
Insurance. An administrative hearing has not been scheduled. Policies of
insurance written in Alabama account for less than 1% of Superior's gross
written premiums.

Due to the losses experienced by Superior, it is in regular ongoing contact with
the departments of insurance of Florida, Virginia and California and insurance
regulators in other states in which it writes business. Superior closely
monitors its risk-based capital based upon its financial projections.

4. COMMITMENTS AND CONTINGENCIES

Superior is a defendant in a case filed June 16, 2003 in the Superior Court of
Muscogee County, Georgia entitled Kenneth P. Chung v. Superior Insurance
Company. The case purports to be brought on behalf of former and current
insureds of Superior who presented first party physical damage coverage claims
during the six-year period preceding June 16, 2003. The plaintiff seeks
recovery of alleged diminution in vehicle value from physical damage. Superior
believes that the allegations of wrongdoing as alleged in the complaint were
without merit and intends to vigorously defend the claims brought against it.

IGF, which is a wholly owned subsidiary of the Company, had been a party to a
number of pending legal proceedings and claims relating to agricultural
production interruption insurance policies (the "AgPI Program") which were sold
during 1998. All of the policies of insurance which were issued in the AgPI
Program were issued by and under the name of Mutual Service Casualty Insurance
Company ("MSI"), a Minnesota corporation with its principal place of business
located in Arden Hills, Minnesota. Sales of this product resulted in large
underwriting losses by IGF.

Approximately $29 million was paid through December 31, 2002 in settlement of
legal proceedings and policyholder claims related to the AgPI Program. All AgPI
policyholder claims were settled during 2000. However, on January 12, 2001 a
case was filed in the Superior Court of California, County of Fresno, entitled
S&W Seed Company, Dudley Silveira, Ric Blanchard and Darrell Silveira v. Mutual
Service Casualty Insurance Company, IGF Insurance Company, and Dibuduo &
Defendis Insurance Agency, Inc.; Case No. OICE CG 00137. The case was brought
by four AgPI policyholders who had previously settled their AgPI claims pursuant
to binding settlement agreements who sought additional compensation by asserting
through litigation that IGF and the third party carrier paid less than the
policy limits they were promised when they purchased the policy and that each
settling policyholder was forced to accept the lesser amount due to their
economic duress. IGF filed a motion for summary judgment to dismiss the claims
in the plaintiff's fourth amended complaint on the basis that releases
previously executed by the plaintiffs are binding, which was granted. The cross
claims between the selling brokers and MSI and IGF remain pending. The trial is
scheduled to begin in August 2003.

The Company is a defendant in a case filed on February 23, 2000, in the United
States District Court for the Southern District of Indiana entitled Robert Winn,
et al. v. Symons International Group, Inc., et al., Cause No. IP 00-0310-C-B/S.
Other parties named as defendants are Goran, three individuals who were or are
officers or directors of the Company or of Goran, PricewaterhouseCoopers LLP and
Schwartz Levitsky Feldman, LLP. The case purports to be brought on behalf of a
class consisting of purchasers of the Company's stock or Goran's stock during
the period February 27, 1998, through and including November 18, 1999.
Plaintiffs allege, among other things, that defendants misrepresented the
reliability of the Company's reported financial statements, data processing and
financial reporting systems, internal controls and loss reserves in violation of
Section 10(b) of the Securities Exchange Act of 1934 (the "1934 Act") and SEC
Rule 10b-5 promulgated thereunder. The individual defendants are also alleged
to be liable as "controlling persons" under Sec.20 (a) of the 1934 Act. As
previously reported in the Company's September 30, 2002 Form 10-Q, the Company,
Goran and the individual defendants entered into an agreement with the
plaintiffs for settlement. The settlement is subject to certain terms and
conditions and court approval.

The Company and two of its subsidiaries, IGFH and IGF, were parties to a
"Strategic Alliance Agreement" dated February 28, 1998 (the "SAA") with
Continental Casualty Company ("CNA"), pursuant to which IGF acquired certain
crop insurance operations of CNA. The obligations of the Company, IGFH, IGF and
CNA under the SAA are the subject of an action filed on June 4, 2001 and pending
in United States District Court for the Southern District of Indiana,
Indianapolis Division. Claims have also been asserted in the action against
Goran, Granite Re, Pafco, Superior and certain members of the Symons family.
Discovery is proceeding. Although the Company continues to believe that it has
claims against CNA and defenses to CNA's claims which may offset or reduce
amounts owing by the Company or its affiliates to CNA, there can be no assurance
that the ultimate resolution of the claims asserted by CNA against the Company
and its affiliates will not have a material adverse effect upon the Company's
and its affiliates' financial condition or results of operations.

Superior was a defendant in a case filed on May 8, 2001 in the United States
District Court Southern District of Florida entitled The Chiropractic Centre,
Inc. v. Superior Insurance Company, Case No. 01-6782. The case purported to be
brought on behalf of a class consisting of healthcare providers improperly paid
discounted rates on services to patients based upon a preferred provider
contract with a third party. The plaintiff alleged that Superior breached a
third party beneficiary contract, committed fraud and engaged in racketeering
activity in violation of federal and Florida law by obtaining discounted rates
offered by a third party with whom the plaintiff contracted directly. On
September 30, 2002, the court issued an administrative order which dismissed the
case. The court's order administratively closing the case could be temporary or
permanent. Superior believes that the allegations of wrongdoing as alleged in
the complaint were without merit and in the event the order is temporary,
Superior intends to vigorously defend the claims brought against it.

IGF is a defendant in a case filed on December 31, 2002 in the Circuit Court of
Greene County, Missouri entitled Kevin L. Stevens v. Wilkerson Insurers, et al.,
Case No. 102CC5135. Other parties named as defendants are Goran, Goran's
subsidiaries, Symons International Group (Florida), Inc. and Granite Re,
Superior Group Management, Superior, Superior American, Superior Guaranty, Pafco
and three individuals who were or are officers or directors of the Company.
Goran, Granite Re, Symons International Group (Florida), Inc, Superior Group
Management, Superior, Superior American, Superior Guaranty and certain
individual defendants filed motions to dismiss for lack of personal jurisdiction
which were denied. The case purports to be brought on behalf of an IGF insured
seeking to recover alleged damages based on allegations of bad faith, negligent
claims handling and breach of fiduciary duties with respect to a claim which
arose from an accident caused by the IGF insured. IGF believes that the
allegations of wrongdoing as alleged in the complaint are without merit and
intends to vigorously defend the claims brought against it.

See footnote 3, "Regulatory Actions", to the Company's consolidated financial
statements in Part I of this report, incorporated herein by reference, for
additional legal matters.

The Company's insurance subsidiaries are parties to other litigation arising in
the ordinary course of business which the Company does not believe will have a
material adverse effect upon the Company's and its affiliates financial
conditions or results. The Company, through its claims reserves, reserves for
both the amount of estimated damages attributable to these lawsuits and the
estimate costs of litigation.

5. LOSS PER SHARE

Basic and diluted net loss per share are computed by dividing net loss as
reported by the average number of shares outstanding as follows:

Three Months Ended
March 31
------------------
(in thousands) 2003 2002
------------------ ------

Basic:
Weighted-average common shares outstanding. 10,385 10,385
================== ======

Diluted:
Weighted-average common shares outstanding. 10,385 10,385
================== ======
<FN>

The Company has 912,777 stock options outstanding as of March 31, 2003. Common
stock equivalents are anti-dilutive; therefore, fully diluted loss per share is
the same as basic loss per share.

6. STOCK-BASED COMPENSATION

The Company accounts for stock-based employee compensation using the intrinsic
value method under APB Opinion 25, "Accounting for Stock Issued to Employees,"
and related interpretations as permitted under SFAS 148, "Accounting for
Stock-Based Compensation - Transition and Disclosure" ("SFAS 148"). Accordingly
no compensation expense is recognized if the market price of the underlying
stock does not exceed the exercise price at the date of grant.

If the Company had applied the fair value recognition provisions of SFAS 123,
"Accounting for Stock-Based Compensation," to stock-based employee compensation
and non-employee director compensation, the effect on net loss and net loss per
share attributable to common stockholders would not be materially affected

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

FORWARD LOOKING STATEMENTS AND CERTAIN RISKS

All statements, trend analyses, and other information herein contained relative
to markets for the Company's products and/or trends in the Company's operations
or financial results, as well as other statements including words such as
"anticipate," "could," "feel(s)," "believes," "plan," "estimate," "expect,"
"should," "intend," "will," and other similar expressions, constitute
forward-looking statements under the Private Securities Litigation Reform Act of
1995. These forward-looking statements are subject to known and unknown risks,
uncertainties and other factors which may cause actual results to be materially
different from those contemplated by the forward-looking statements. Such
factors include, among other things: (i) the effect on customers, agents,
employees and others due to the Company's receipt of going concern opinions from
its accountants; (ii) general economic conditions, including prevailing interest
rate levels and stock market performance; (iii) factors affecting the Company's
nonstandard automobile operations such as rate increase approval, policy
renewals, new business written and premium volume; and (iv) the factors
described in this section and elsewhere in this report.

OVERVIEW OF THE COMPANY

Symons International Group, Inc. (the "Company") owns insurance companies that
underwrite and market nonstandard private passenger automobile insurance. The
Company's principal insurance company subsidiaries are Pafco General Insurance
Company ("Pafco"), Superior Insurance Company ("Superior") and IGF Insurance
Company ("IGF"). The Company is a 73.8% owned subsidiary of Goran Capital Inc.
("Goran").

The Company's accountants have issued reports on their audits of the
Consolidated Financial Statements of the Company as of December 31, 2001 and
December 31, 2002 which address doubt as to the Company's ability to continue as
a going concern given the recurring operating losses experienced by the Company
over the past few years and the Company's net capital deficiency.

In June 2001, the Company sold its crop segment and adopted a plan to wind-down
the remaining crop segment obligations. Accordingly, financial results of the
crop insurance segment are presented as discontinued operations in the Company's
financial statements. Continuing operations of the Company consist of the single
nonstandard automobile insurance segment.

Pafco, Superior, Superior Guaranty Insurance Company ("Superior Guaranty"), and
Superior American Insurance Company ("Superior American") are engaged in the
writing of insurance coverage for automobile physical damage and liability
policies for nonstandard risks. Nonstandard risk insureds are those individuals
who are unable to obtain insurance coverage through standard market carriers due
to factors such as poor premium payment history, driving experience or
violations, particular occupation or type of vehicle. The Company offers
several different policies that are directed towards different classes of risk
within the nonstandard market. Premium rates for nonstandard risks are higher
than for standard risks. Since it can be viewed as a residual markets the size
of the nonstandard private passenger automobile insurance market changes with
the insurance environment and grows when the standard coverage becomes more
restrictive. Nonstandard policies have relatively short policy periods and low
limits of liability. Also, since the nonstandard automobile insurance business
typically experiences lower rates of retention than standard automobile
insurance, the number of new policyholders underwritten by nonstandard
automobile insurance carriers each year is substantially greater than the number
of new policyholders underwritten by standard carriers.

SIGNIFICANT LOSSES HAVE BEEN REPORTED AND ARE LIKELY TO CONTINUE

The Company has reported net losses on a quarterly basis since the third quarter
of 1998. Net losses from continuing operations for the quarter ended March 31,
2003 totaled $(5,007,000) compared to losses of $(7,729,000) for the same period
in 2002. The Company previously reported losses from continuing operations of
$(35,260,000) for the year 2002
$(30,736,000) for 2001 and $(71,384,000) for 2000. Results from continuing
operations before the effects of income taxes and minority interest were losses
of $(19,236,000) and $(15,930,000) for 2002 and 2001, respectively. Losses from
continuing operations increased in 2002 from 2001 due to significant adverse
development on new business generated in the first quarter of 2002, primarily
due to increased frequency of losses. The Company's losses continued for the
period ending March 31,2003; however, the Company continues to work towards
operational improvements. The financial condition of the company's insurance
subsidiaries' continues to be of concern to the insurance regulators and has
resulted in heightend regulatory oversight. Although the Company has taken a
number of actions to address factors contributing to these past losses, there
can be no assurance that operating losses will not continue.

RECENT AND FURTHER REGULATORY ACTIONS MAY ADVERSELY AFFECT THE COMPANY'S FUTURE
OPERATIONS

The Company's insurance company subsidiaries, their business operations, and
their transactions with affiliates, including the Company, are subject to
extensive regulation and oversight by the IDOI, the FDOI and the insurance
regulators of other states in which the insurance company subsidiaries write
business. Moreover, the insurance company subsidiaries' financial condition,
losses, adverse trends and uncertainties discussed in this report have been and
continue to be matters of concern to the domiciliary and other insurance
regulators of the Company's insurance company subsidiaries and have resulted in
significant and ongoing scrutiny and regulatory action by several regulators
(see Note 3, "Regulatory Actions" in the Condensed Notes to the Consolidated
Financial Statements). The primary purpose of insurance regulation is the
protection of policyholders rather than shareholders. Failure to improve the
insurance subsidiaries' financial conditions and resolve issues with the IDOI
and the FDOI, and with other regulators, in a manner satisfactory to the Company
could impair the Company's ability to execute its business strategy or result in
future regulatory actions or proceedings that could otherwise materially and
adversely affect the Company's operations.

THE COMPANY IS SUBJECT TO A NUMBER OF PENDING LEGAL PROCEEDINGS

As discussed elsewhere in this report, the Company is involved in a number of
pending legal proceedings (see Part II - Item 1, "Legal Proceedings"). Although
the Company believes that many of the allegations of wrongdoing are without
merit and intends to vigorously defend the claims brought against it, there can
be no assurance that such proceedings will not have a material adverse effect on
the Company's financial position or results of operations. Furthermore, the
existence of these lawsuits diverts the time and attention of management and
they are expensive to defend, whether or not the Company is ultimately
successful.

THE TERMS OF THE TRUST PREFERRED SECURITIES MAY RESTRICT THE COMPANY'S ABILITY
TO ACT

The Company has issued through a wholly owned trust subsidiary $135 million
aggregate principal amount in trust originated preferred securities ("Preferred
Securities"). The Preferred Securities have a term of 30 years with annual
interest at 9.5% paid semi-annually. The obligations of the Preferred Securities
are funded from the Company's nonstandard automobile insurance management
company. The Company elected to defer the semi-annual interest payments due in
February and August 2000, 2001 and 2002 and the payment due in February 2003 and
may continue to defer such payments for up to an aggregate of five years as
permitted by the indenture for the Preferred Securities. All of the deferred
interest (if all payments due in 2003, and 2004 are deferred) of approximately
$84 million will become due and payable in February 2005 along with the
semi-annual interest payment due at that time. In the event the Company does not
have sufficient funds to pay the deferred interest on the Preferred Securities,
it could result in default under the indenture and an acceleration of the
payment of the Preferred Securities. Although there is no present default under
the indenture that would accelerate the payment of the Preferred Securities, the
indenture contains a number of covenants that may restrict the Company's ability
to act in the future. These covenants include restrictions on the Company's
ability to incur or guarantee debt, make payment to affiliates, repurchase its
common stock, pay dividends on common stock or increase its level of certain
investments other than investment-grade, fixed-income securities. There can be
no assurance that compliance with these restrictions and other provisions of the
indenture for the Preferred Securities will not adversely affect the cash flow
of the Company.

REVIEW OF CONSOLIDATED OPERATIONS

NET LOSS

The net loss for the three months ended March 31, 2003 totaled $(5,007,000) or
$(.48) per share (basic and diluted). This is an improvement of $2,722,000 or
$0.26 per share from the net loss for the same period in 2002. The decreased
net loss is due primarily to a reduction in loss and loss adjustment expenses.
There was no loss on discontinued operations for the three months ended March
31, 2003 and 2002, respectively.
GROSS PREMIUMS WRITTEN

Gross premiums written decreased 36.3% for the three months ended March 31, 2003
compared to the three months ended March 31, 2002. The primary reasons for this
decline in volume are the withdrawal from certain competitive markets and other
underwriting initiatives intended to increase profitability.

NET PREMIUMS WRITTEN

Net premiums written represent the portion of premiums retained by the Company
after consideration for risk sharing through reinsurance contracts. As a result
of losses in the Company's insurance subsidiaries and the corresponding growth
in the Company's retained deficit and to manage overall risk retention, the
Company entered into a reinsurance agreement to cede a portion of its gross
written premiums to National Union Fire Insurance Company of Pittsburgh, PA, an
unrelated third party. For the three months ended March 31, 2003, the Company
ceded approximately 75% of its gross written premiums.

NET PREMIUMS EARNED

Net premiums earned decreased 47.9% or $5,632,000 for the quarter ended March
31, 2003 as compared to the same period in 2002. Premiums are earned ratably
over the term of the underlying insurance contracts and the reduction in net
premiums earned is a result of the decreases in written premium and policies in
force.

FEE INCOME

Fee income is derived from installment billings and other services provided to
policyholders. In the first quarter of 2003, fee income was 4.1% lower as
compared to the same period in 2002 and was higher as a percentage of written
premiums due to increased fees per policy.

NET INVESTMENT INCOME

Net investment income decreased 77.3% for the three months ended March 31, 2003
as compared to the same period in 2002. This decrease is reflective of the
decline in invested assets during a period of declining premiums and the
liquidation of investments to pay prior year losses settled in 2002.

NET REALIZED CAPITAL (LOSSES)

Net realized capital gains were $245,000 for the first quarter of 2003 as
compared to net realized capital losses of $(748,000) for the same period in
2002. Capital gains resulted from the shift in management investing approach
toward a secure and less risky bond market. In the first quarter of 2003, fixed
maturities investment portfolio returned a positive yield as opposed to the
highly volatile stock market. These transactions resulted in higher cash
proceeds that were reinvested in shorter duration investment instruments.

LOSSES AND LOSS ADJUSTMENT EXPENSES

The loss and loss adjustment expense ratio for the Company for the three months
ended March 31, 2003 was 90.1% of net premiums earned as compared to 107.7% for
first quarter 2002 and to 127.9% for the entire year of 2002.
POLICY ACQUISITION AND GENERAL AND ADMINISTRATIVE EXPENSE

Policy acquisition and general and administrative expenses decreased for the
first quarter of 2003 to $4,830,000 from $6,459,000 for the same period in
2002, a decrease of approximately 25%. This decrease is reflective of the
decline in gross written premiums, an increase in ceding commissions associated
with the quota share reinsurance contract, and overall operating expense
reduction initiatives.
INCOME TAXES

At March 31, 2003, the Company's net deferred tax assets are fully offset by a
100% valuation allowance that resulted in no tax benefit in the first quarters
of both 2002 and 2001.

REVIEW OF CONSOLIDATED FINANCIAL POSITION

CASH AND INVESTMENTS

Total cash and investments at March 31, 2003 and December 31, 2002 was $44.5
million and $55.3 million, respectively. The decline in invested assets resulted
from continued liquidations to fund claim payments and operating expenses as
well as the portfolio rebalancing mentioned above. Refer to "Net Realized
Capital (Losses)" above for a discussion of other changes in cash and investment
balances.

REINSURANCE RECEIVABLES AND PAYABLES

The Company negotiated a third-party quota share reinsurance agreement that
became effective January 1, 2000. Under the quota share agreement, the Company
may cede a portion of its nonstandard automobile insurance premiums and related
losses based on a variable percentage of up to 75% of Superior's and up to 75%
of Pafco's earned premiums. The Company's ceding percentage for the first
quarter of 2003 totaled 75% for Superior and 60% for Pafco. The decrease in the
amount of premiums and losses ceded under this contract along with settlements
to the reinsurers's directly affect reinsurance balances due and payable on the
face of the financial statements.

RECEIVABLES

Receivables, exclusive of the allowance for doubtful accounts, have increased by
approximately $2.3 million, or 8.6%, from December 31, 2002. This increase is
primarily attributable to an increase in billable premiums due to higher written
premiums in the first quarter of 2003 versus the fourth quarter of 2002. The
allowance for doubtful accounts was increased in the first quarter of 2003 by
approximately $433,000.

LOSS AND LOSS ADJUSTMENT EXPENSE RESERVES

Total loss and loss adjustment expense reserves decreased from $67,204,000 as of
December 31, 2002 to $63,589,000 as of March 31, 2003, a reduction of
approximately $3.6 million. This decrease is consistent with the Company's
declining volume of business.

UNEARNED PREMIUMS

At March 31, 2003, unearned premiums were $39,298,000, an increase of $3,501,000
from December 31, 2002. This is consistent with the increase in receivables
discussed above.

DEFERRED INCOME

In connection with the sale of the crop insurance book of business to Acceptance
on June 6, 2001, the Company received a payment of $4.5 million for agreeing not
to engage in the crop insurance business for three years from the sale date. The
payment is being amortized to income on a straight-line basis over a three-year
period.

SHAREHOLDERS' (DEFICIT)

Shareholders' (deficit) has increased by $(5,904,000) from December 31, 2002.
This increase is primarily the result of the net loss of $(5,007,000) for the
three months ended March 31, 2003 coupled with an unrealized loss of $(897,000)
on investments available for sale.

LIQUIDITY AND CAPITAL RESOURCES

The primary source of funds available to the management and holding companies
are fees from policyholders and management fees.

Superior Insurance Group, Inc. ("Superior Group") collects billing fees charged
to Pafco policyholders, who elect to make their premium payments in
installments, and managing general agent ("MGA") fees charged to Superior
policyholders. Superior Group also receives management fees under its
management agreement with its insurance subsidiaries. When the Florida
Department of Insurance ("FDOI") approved the acquisition of Superior by
Superior Group, it prohibited Superior from paying any dividends (whether
extraordinary or not) for four years from the date of acquisition (May 1, 1996)
without the prior written approval of the FDOI, which restriction expired in
April 2000. As a result of regulatory actions taken by the Indiana Department
of Insurance ("IDOI") with respect to Pafco and IGF, those subsidiaries may not
pay dividends without prior approval by the IDOI. Pafco cannot pay
extraordinary dividends, within the meaning of the Indiana Insurance Code,
without the prior approval of the Indiana Insurance Commissioner. The
management fees charged to Pafco, Superior and IGF are subject to review by the
IDOI and FDOI.

The nonstandard automobile insurance subsidiaries' primary source of funds is
premiums, investment income and proceeds from the maturity or sale of invested
assets. Such funds are used principally for the payment of claims, payment of
claims settlement costs, operating expenses (primarily management fees),
commissions to independent agents, premium taxes, dividends and the purchase of
investments. There is variability in cash outflows because of uncertainties
regarding settlement dates for liabilities for unpaid losses. Accordingly, the
Company maintains investment programs intended to provide adequate funds to pay
claims. During 2003, 2002 and 2001, due to reduced premium volume, the Company
liquidated investments to pay claims. The Company historically has tried to
maintain duration averages of 3.5 years. However, the reduction in new funds
due to lower premium volume caused the Company to shorten the duration of its
investments. The Company may incur additional costs in selling longer-term bonds
to pay claims, as claim payments tend to lag premium receipts. Due to the
decline in premium volume, the Company experienced a reduction in its investment
portfolio, but to date has not experienced any problems meeting its obligations
for claims payments.

The Company has obtained a revolving credit facility ("Facility") with Granite
Reinsurance Company Ltd., a related party, in the amount of $2.5 million due
December 20, 2004, and $1.0 million due November 30, 2004, in December 2001 and
October 2002, respectively. The terms of the Facility call for monthly interest
payments at the prime rate (as printed in the Wall Street Journal on the first
business day of each month) plus 5.25% (the total rate was 9.5% at March 31,
2003) computed on an annual basis and not to exceed 18% per annum calculated on
the average principal outstanding each month.

The Company elected to defer the semi-annual interest payments due in February
and August 2000, 2001, 2002 and February 2003 and expects to continue this
practice through 2004. The unpaid interest installment amounts accrue interest
at 9.5%.

The Company may continue to defer semi-annual interest payments for up to an
aggregate of five (5) years as permitted by the indenture for the Preferred
Securities. All of the deferred interest (approximately $84 million, if all
payments due in 2003 and 2004 are deferred) will become due and payable in
February 2005 along with the semi-annual interest due at that time. The Company
relies on the payment of finance and service fees by its subsidiaries to fund
its operations, including its payment of interest on the Preferred Securities.
Certain state regulators, including the FDOI, have issued orders prohibiting the
Company's subsidiaries from paying such fees to the Company. In the event such
orders continue, the Company may not have sufficient revenue to fund its
operations or to pay the deferred interest on the Preferred Securities. Such
failure to pay could result in default under the indenture and acceleration of
the payment of the Preferred Securities.

These restrictions currently apply, as the Company's consolidated coverage ratio
was (0.42) in March 31, 2003, and will continue to apply until the Company's
consolidated coverage ratio complies with the terms of the trust indenture. The
Company complied with these additional restrictions as of December 31, 2001 and
2002 and is in compliance as of May 9, 2003.

Net cash used by operating activities in 2003 aggregated $(9,266,000) compared
to $(6,729,000) for March 31, 2003 due to reduced cash provided by operations as
a result of lower premium volumes and the reduced number of policies in force.

As reported in the Company's December 31, 2002 Form 10-K, during 2002 the
Company initiated a number of actions to improve is financial condition.

ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

Information related to Qualitative and Quantitative Disclosures about Market
Risk was included under Item 1. Business in the December 31, 2002 Form 10-K. No
material changes have occurred in market risk since this information was
disclosed in the December 31, 2002 Form 10-K.

PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS

See footnote 3, "Regulatory Actions", and footnote 4, "Commitment and
Contingencies", to the Company's consolidated financial statements in Part I of
this report, incorporated herein by reference, for additional legal matters.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None

ITEM 5. OTHER INFORMATION
None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Exhibits
--------

99.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.

Reports on Form 8-K
----------------------
None

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

Symons International Group, Inc.

July 15, 2003 By: /s/ Douglas H.Symons
---------------------
Douglas H. Symons, President
and Chief Executive Officer

SYMONS INTERNATIONAL GROUP, INC.
--------------------------------

CERTIFICATE

I, Douglas H. Symons, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Symons International
Group, Inc.

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report.

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report.

4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a014 and 15d-14) for the
registrant, and we have:

a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and

c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

5. I have disclosed, based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or
persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and

6. I have indicated in this quarterly report whether or not there were
significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most
recent evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.

Dated: July 15, 2003 /s/ Douglas H. Symons
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Douglas H. Symons
Chief Executive Officer