Letter from the Chairman

Eighteen months ago Delos was created with an ambitious goal: to transform program business.

Dr. Detlef Steiner

Chairman

In the first 12 months we silenced the skeptics, more than doubling our annualized premium and attracted the best MGAs in the business. More impressively, Delos has maintained this momentum as we continue to achieve impressive business results and enhance the way that we-and the industry-do business.

A few of our 2007 highlights include adding 12 new programs to our portfolio; the formation of E&S carrier, NAXOS Insurance Company that will begin writing business before the end of the year and the recruitment of an experienced senior management team. All of these have contributed to Delos' extraordinary financial performance during this period of time.

Our partners are seasoned professionals that value our commitment to program business. This commitment endorses our flat organizational structure, eliminates channel conflicts, elevates service standards and strengthens our ability to develop long-term relationships based on trust. This pattern of progress has been excellent thus far and I am particularly proud of our accomplishments in this area.

As you know, the outsourced model and close partnership with MGAs and GAs is central to Delos' business model and success. This means that the method and systems of processing information between these parties, as well the efficiency of our systems internally, has a direct impact on our business. Delos has risen to this challenge and, under the guidance of our professional Information Technology team; we have made enormous strides in our infrastructure. Foremost among our improvements is the implementation of Genesis, a web-based software application that collects data at the lowest level available in order to facilitate internal and external financial and statistical reporting.

Delos' continued growth and financial strength depends on the talent and dedication of our senior management, employees and trusted business partners. We will continue to identify and implement operational and cost efficiencies in order to maintain Delos' reputation as a competitive, reliable, responsible and trustworthy program insurer.

We are grateful for your ongoing support and continued interest in Delos.