Old Republic Reports Financial Results For The Fourth Quarter And Full Year 2012

 Old Republic Reports Financial Results For The Fourth Quarter And Full Year
                                     2012

PR Newswire

CHICAGO, Jan. 24, 2013

CHICAGO, Jan. 24, 2013 /PRNewswire/ --Old Republic International Corporation
(NYSE: ORI), today  reported financial results for the fourth quarter and full
year 2012. In late March 2012, the Company announced that its General
Insurance Group's Consumer Credit Indemnity (CCI) division would be combined
with its Mortgage Guaranty (MI) business in a renamed Republic Financial
Indemnity Group, Inc. ("RFIG") run-off segment. The two operations, which
offer similar insurance coverages, have been in run-off operating mode since
2008 (CCI) and August 2011 (MI), and are inactive from new business production
standpoints.

The combination affects the manner in which segmented information is now
presented. The operating results of the combined coverages are therefore shown
as a single run-off book of business within ORI's consolidated operations.
Prior periods' segmented information for the general insurance and RFIG
run-off business segments has therefore been reclassified to provide necessary
consistency in period-to-period comparisons.

Financial Highlights (*)
              Quarters Ended December 31,        Years Ended December 31,
              2012          2011       Change    2012       2011       Change
Operating
Revenues:
Excluding
run-off       $  1,181.6    $ 1,044.9  13.1%     $ 4,474.9  $ 3,965.3  12.9%
business
RFIG run-off     97.4         134.9    -27.8       447.3      564.6    -20.8
business
Total         $  1,279.0    $ 1,179.8  8.4%      $ 4,922.2  $ 4,529.9  8.7%
Net Operating
Income
(Loss):
Excluding
run-off       $  57.6       $ 82.1     -29.8%    $ 231.0    $ 257.5    -10.3%
business
RFIG run-off     (80.6)       (109.8)  26.5        (330.8)    (476.1)  30.5
business
Total         $  (23.0)     $ (27.7)   16.9%     $ (99.7)   $ (218.5)  54.3%
Net Income
(Loss):
Excluding
run-off       $  60.1       $ 118.5    -49.3%    $ 253.1    $ 280.5    -9.8%
business
RFIG run-off     (80.4)       (63.2)   -27.1       (321.8)    (421.1)  23.6
business
Total         $  (20.2)     $ 55.2     -136.6%   $ (68.6)   $ (140.5)  51.1%
Diluted
Earnings Per
Share:
Net Operating
Income (Loss)
Excluding
run-off       $  0.23       $ 0.32     -28.1%    $ 0.90     $ 1.01     -10.9%
business
RFIG run-off     (0.32)       (0.43)   25.6        (1.29)     (1.87)   31.0
business
Total         $  (0.09)     $ (0.11)   18.2%     $ (0.39)   $ (0.86)   54.7%
Net Income
(Loss)
Excluding
run-off       $  0.23       $ 0.47     -51.1%    $ 0.99     $ 1.10     -10.0%
business
RFIG run-off     (0.31)       (0.25)   -24.0       (1.26)     (1.65)   23.6
business
Total         $  (0.08)     $ 0.22     -136.4%   $ (0.27)   $ (0.55)   50.9%
Cash
Dividends Per $  0.1775     $ 0.1750   1.4%      $ 0.7100   $ 0.7000   1.4%
Share
Ending Book
Value Per                                        $ 14.03    $ 14.76    -4.9%
Share
(*) Unaudited; All amounts in this report are in millions except per share
data and percentages.

Full year and fourth quarter 2012 operating results benefited from substantial
improvements in title insurance and much reduced losses in the combined
mortgage guaranty ("MI") and consumer credit indemnity ("CCI") run-off books
of business. For both the latest quarter and year, however, general insurance
profits dropped measurably as an increase in claim costs, mostly for the
workers' compensation coverage, hindered profitability in Old Republic's
largest segment.

Consolidated Results – The major components of Old Republic's consolidated
results and other data for the periods reported upon are shown below.

                         Quarters Ended December 31,  Years Ended December 31,
                         2012            2011         2012          2011
Operating revenues:
General insurance        $   686.8       $  647.6     $  2,699.4    $  2,488.6
Title insurance              478.6          379.4        1,707.1       1,391.8
Corporate and other          16.0           17.8         68.3          84.8
 Subtotal                  1,181.6        1,044.9      4,474.9       3,965.3
RFIG run-off business        97.4           134.9        447.3         564.6
Total                    $   1,279.0     $  1,179.8   $  4,922.2    $  4,529.9
Pretax operating income
(loss):
General insurance        $   60.5        $  105.8     $  261.0      $  353.9
Title insurance              20.2           18.3         73.8          36.2
Corporate and other          2.6            (3.5)        (2.7)         (14.6)
 Subtotal                 83.3           120.6        332.1         375.5
RFIG run-off business        (124.0)        (169.0)      (508.6)       (727.8)
Total                        (40.7)         (48.3)       (176.4)       (352.2)
Realized investment
gains (losses):
From sales                   4.4            127.6        48.1          165.8
From impairments             (0.2)          -            (0.2)         (50.2)
Net realized investment      4.2            127.6        47.8          115.5
gains (losses)
Consolidated pretax          (36.4)         79.2         (128.5)       (236.7)
income (loss)
Income taxes (credits)       (16.2)         24.0         (59.8)        (96.1)
Net income (loss)        $   (20.2)      $  55.2      $  (68.6)     $  (140.5)
Consolidated 
underwriting ratio:
Including RFIG run-off
business:
Benefits and claim ratio     59.2%          65.0%        61.9%         68.3%
Expense ratio                50.8           46.4         48.5          47.5
Composite ratio              110.0%         111.4%       110.4%        115.8%
Excluding RFIG run-off
business:
Benefits and claim ratio     44.5%          43.6%        45.7%         45.2%
Expense ratio                54.1           50.2         52.4          51.2
Composite ratio              98.6%          93.8%        98.1%         96.4%
Diluted earnings per
share:
Net operating income     $   (0.09)      $  (0.11)    $  (0.39)     $  (0.86)
(loss)
Net realized investment      0.01           0.33         0.12          0.31
gains (losses)
Net income (loss)        $   (0.08)      $  0.22      $  (0.27)     $  (0.55)
Cash dividends paid per  $   0.1775      $  0.1750    $  0.7100     $  0.7000
share
Components of diluted
earnings per share:
Net operating income
(loss):
General insurance        $   0.17        $  0.28      $  0.72       $  0.95
Title insurance              0.05           0.05         0.18          0.10
Corporate and other          0.01           (0.01)       -             (0.04)
Subtotal                     0.23           0.32         0.90          1.01
RFIG run-off business        (0.32)         (0.43)       (1.29)        (1.87)
Total                        (0.09)         (0.11)       (0.39)        (0.86)
Net realized investment      0.01           0.33         0.12          0.31
gains (losses)
Net income (loss)        $   (0.08)      $  0.22      $  (0.27)     $  (0.55)

The preceding tables show operating and net income or loss to highlight the
effects of realized investment gain or loss recognition on period-to-period
comparisons. The recognition of realized investment gains or losses can be
highly discretionary and arbitrary due to such factors as the timing of
individual securities sales, recording of estimated losses from write-downs of
impaired securities, tax-planning considerations, and changes in investment
management judgments relative to the direction of securities markets or the
future prospects of individual investees or industry sectors. Likewise,
non-recurring items which may emerge from time to time can distort the
comparability of the Company's results from period to period. Accordingly,
management uses net operating income, a non-GAAP financial measure, to
evaluate and better explain operating performance, and believes its use
enhances an understanding of Old Republic's core business results. Operating
income, however, does not replace net income determined in accordance with
GAAP as a measure of total profitability. The composition of realized gains or
losses follows:

                                        Quarters Ended      Years Ended
                                        December 31,        December 31,
                                        2012     2011       2012     2011
Realized gains (losses) from sales of
previously impaired securities:
Actual tax basis (loss) on sales        $ -      $ (154.7)  $ (2.0)  $ (154.7)
Accounting adjustment for impairment
charges taken in prior periods            -        157.1      7.5      157.5
Net amount included herein                -        2.3        5.4      2.8
Net realized gains from sales of all      4.4      125.3      42.5     163.0
other securities
Net gain (loss) from actual sales         4.4      127.6      48.1     165.8
Net realized losses from impairments      (0.2)    -          (0.2)    (50.2)
Net realized investment gains (losses)  $ 4.2    $ 127.6    $ 47.8   $ 115.5
reported herein

General Insurance Results – Operating earnings, with and without the CCI
run-off business were lower in the latest quarter and for 2012 as a whole. Key
indicators of year-over-year performance are shown in the following table:

                       General Insurance Group
                       Quarters Ended December    Years Ended December 31,
                       31,
                       2012      2011     Change  2012       2011       Change
A. Prior to
reclassification/

Including CCI run-off
business:
Net premiums earned    $  604.9  $ 566.2  6.8%    $ 2,366.9  $ 2,167.7  9.2%
Net investment income     66.4     68.3   -2.7      265.0      270.5    -2.0
Benefits and claim        454.7    390.8  16.3      1,808.9    1,562.9  15.7
costs
Pretax operating       $  51.8   $ 100.0  -48.2%  $ 186.0    $ 304.3    -38.9%
income (loss)
Claim ratio            75.2%       69.0%          76.4%      72.1%
Expense ratio          26.0        24.0           25.5       24.8
Composite ratio        101.2%      93.0%          101.9%     96.9%
B. All CCI run-off

business
reclassification(*):
Net premiums earned    $  9.4    $ 14.1   -33.0%  $ 42.4     $ 58.3     -27.1%
Net investment income     -        -      -         0.1        -        N/M
Benefits and claim        16.3     18.6   -12.6     112.8      102.9    9.7
costs
Pretax operating       $  (8.6)  $ (5.7)  -50.5%  $ (74.9)   $ (49.6)   -51.0%
income (loss)
Claim ratio            172.5%    132.3%           265.7%     176.5%
Expense ratio          19.6      8.5              11.0       8.7
Composite ratio        192.1 %   140.8%           276.7%     185.2%
C. After
reclassification/

Total Excluding all
CCI run-off business:
Net premiums earned    $  595.4  $ 552.1  7.9%    $ 2,324.4  $ 2,109.4  10.2%
Net investment income     66.4     68.3   -2.8      264.9      270.5    -2.1
Benefits and claim        438.4    372.1  17.8      1,696.0    1,460.0  16.2
costs
Pretax operating       $  60.5   $ 105.8  -42.8%  $ 261.0    $ 353.9    -26.3%
income (loss)
Claim ratio            73.6%     67.4%            73.0%      69.2%
Expense ratio          26.1      24.3             25.7       25.2
Composite ratio        99.7%     91.7%            98.7%      94.4%
(*) In connection with the previously noted MI / CCI combination, $6.6 and
$70.9 of pretax operating losses for the fourth quarter and full year 2012,
respectively, are retained by certain general insurance companies pursuant
to various quota share and stop loss reinsurance agreements. All of these
amounts, however, have been reclassified and are included for segment
reporting purposes such that table (B) above incorporates 100% of the CCI
run-off business results.

Favorable premium trends for workers' compensation and liability insurance
lines within Old Republic's construction, trucking, and large account risk
management business were mainly responsible for premium growth throughout
2012. Moderate rate improvements garnered in the past twenty-four months or
so, and the strengthening though slow pace of U.S. economic activity were
major underlying factors in this regard.

As in other segments of Old Republic's business, general insurance net
investment income reflected slight downtrends. While operating cash flow has
remained positive and additive to the invested asset base, market yields on
quality securities to which investments and reinvestments of funds are
committed remained in a weakened state.

As indicated in section (C) of the above table, the general insurance
composite underwriting ratio for 2012 and the year's final quarter was up by
single digits when compared with 2011. Higher loss costs for the aggregated
commercial automobile (trucking), general liability, and workers' compensation
coverages were most responsible for this uptrend, though workers' compensation
produced the greatest adverse impact. The general expense ratio was affected
negatively by approximately 1.1 and 1.6 percentage points in the final quarter
and for all of 2012, respectively, for charges related to previously deferred
policy acquisition costs no longer amortizable. These charges arose from new
Financial Accounting Standards Board guidance that took effect on January 1,
2012.

Title Insurance Results – Old Republic's title insurance business registered
consistently positive operating momentum during 2012. Key performance
indicators are shown below:

                    Title Insurance Group
                    Quarters Ended December 31,  Years Ended December 31,
                    2012        2011     Change  2012       2011       Change
Net premiums and    $  471.1    $ 372.1  26.6%   $ 1,677.4  $ 1,362.4  23.1 %
fees earned
Net investment         6.9        6.9    -0.7      27.3       27.3     -0.1
income
Claim costs            32.9       28.9   13.7      120.8      105.7    14.3
Pretax operating    $  20.2     $ 18.3   9.9%    $ 73.8     $ 36.2     103.9 %
income (loss)
Claim ratio         7.0%        7.8%             7.2%       7.8%
Expense ratio       89.8        88.8             89.6       91.2
Composite ratio     96.8%       96.6%            96.8%      99.0%

Growth in title insurance premiums and fees benefited from a combination of
factors. Key among these were market share gains emanating from title industry
dislocations and consolidation during the past four years or so, and greater
levels of mortgage refinancing activity in more recent quarters. Claim ratios
for 2012 were moderately lower in relation to 2011 as frequency and severity
trends abated somewhat. Year-over-year expense ratio comparisons benefited
from continued rationalization of an expense structure more accommodative of
current and future growth prospects.

RFIG Run-off Business Results – The table below reflects RFIG's comparative
results before and after the previously noted combination of mortgage guaranty
and consumer credit indemnity run-off coverages:

                       RFIG Run-off Business
                       Quarters Ended December 31,   Years Ended December 31,
                       2012       2011       Change  2012       2011       Change
A. Prior to
reclassification/
Excluding  CCI 
run-off  business:
Net premiums earned    $ 79.7     $ 108.7    -26.6%  $ 368.0    $ 444.9    -17.3%
Net investment income    8.0        11.5     -29.8     36.2       59.2     -38.9
Claim costs              195.7      262.4    -25.4     797.5      1,057.1  -24.6
Pretax operating       $ (115.4)  $ (163.2)  29.3%   $ (433.6)  $ (678.1)  36.1%
income (loss)
Claim ratio            245.3%     241.3%             216.7%     237.6%
Expense ratio          9.4        17.5               10.4       23.9
Composite ratio        254.7%     258.8%             227.1%     261.5%
B. CCI run-off
business

reclassification(*):
Net premiums earned    $ 9.4      $ 14.1     -33.0%  $ 42.4     $ 58.3     -27.1%
Net investment income    -          -        -         0.1        -        N/M
Claim costs              16.3       18.6     -12.6     112.8      102.9    9.7
Pretax operating       $ (8.6)    $ (5.7)    -50.5%  $ (74.9)   $ (49.6)   -51.0%
income (loss)
Claim ratio            172.5%     132.3%             265.7%     176.5%
Expense ratio          19.6       8.5                11.0       8.7
Composite ratio        192.1%     140.8%             276.7%     185.2%
C. After
reclassification/Total
RFIG  run-off  MI  and
CCI  business:
Net premiums earned    $ 89.2     $ 122.9    -27.4%  $ 410.5    $ 503.2    -18.4%
Net investment income    8.1        11.5     -29.4     36.3       59.3     -38.7
Claim costs              212.0      281.1    -24.6     910.4      1,160.1  -21.5
Pretax operating       $ (124.0)  $ (169.0)  26.6%   $ (508.6)  $ (727.8)  30.1%
income (loss)
Claim ratio            237.5%     228.7%             221.8%     230.5%
Expense ratio          10.5       16.5               10.4       22.1
Composite ratio        248.0%     245.2%             232.2%     252.6%
(*) In connection with the previously noted MI / CCI combination, $6.6 and
$70.9 of pretax operating losses for the fourth quarter and full year 2012,
respectively, are retained by certain general insurance companies pursuant to
various quota share and stop loss reinsurance agreements. All of these
amounts, however, have been reclassified and are included for segment
reporting purposes such that table (B) above incorporates 100% of the CCI
run-off business results.

Mortgage guaranty earned premiums continued to decline throughout 2012. The
gradual depletion of a book of business in run-off operating mode, together
with premium refunds related to claim rescission activity and the termination
of new business production since August, 2011 were major factors leading to
the decline.

Net investment income fell as a consequence of a lower invested asset base
eroded by declining premium volumes and ongoing claim disbursements, and a
pervasively low yield environment for the investment portfolio.

2012 MI claim costs were lower as a continuing downtrend in newly reported
cases, relatively stable cure rates, and lower paid claim levels more than
offset reduced provisions for claim rescissions or denials, and assumptions of
greater defaults headed to foreclosure. Lower operating expenses for 2012
reflect ongoing cost reductions geared to a run-off operating mode.

Table (B) above shows 100% of CCI results fully reclassified for segment
reporting purposes. 2012 operating performance for this coverage was impacted
by much greater claim costs. These were driven by higher estimates of
continuing claim litigation expenses, most of which were posted in the year's
second quarter, and reduced expectations of salvage recoveries on cumulative
claims incurred to date.

As reported in earlier periods, the Company's flagship mortgage guaranty
insurance carrier, Republic Mortgage Insurance Company ("RMIC"), had been
operating pursuant to a waiver of minimum state regulatory capital
requirements since late 2009. This waiver expired on August 31, 2011 and, as a
consequence, the underwriting of new policies ceased and the existing book of
business was placed in run-off operating mode.

During 2012 the North Carolina Department of Insurance ("NCDOI") issued
several orders the ultimate effects of which were:

  oTo place RMIC and its affiliate, Republic Mortgage Insurance Company of
    North Carolina ("RMICNC") under NCDOI supervision;
  oTo approve a Corrective Plan submitted by RMIC pursuant to which all
    settled claims are to be paid in cash for 60% of the settled amount, with
    the remaining 40% retained in claim reserves as a Deferred Payment
    Obligation ("DPO") until a future payment of all or a portion of this 40%
    is approved by the NCDOI; and
  oTo execute the DPO-based run-off plan under Old Republic's ownership and
    NCDOI supervision of RMIC and RMICNC to effect a most economically sound
    realization of ultimate benefits to policyholders during a sufficiently
    long future period.

RMIC's evaluation of the potential long-term performance of the run-off book
of business is based on various modeling techniques. Of necessity the
resulting models take into account actual premium and paid claim experience of
prior periods, together with a large number of assumptions and judgments about
future outcomes that are highly sensitive to a wide range of estimates. Many
of these estimates and underlying assumptions relate to matters over which the
Company has no control, including: 1) The conflicted interests, as well as
the varying mortgage servicing and foreclosure practices of a large number of
insured lending institutions; 2) General economic and industry-specific trends
and events; and 3) The evolving or future social and economic policies of the
U.S. Government vis-à-vis such critical sectors as the banking, mortgage
lending, and housing industries, as well as its policies for resolving the
insolvencies and assigning a possible future role to Fannie Mae and Freddie
Mac. These matters notwithstanding, RMIC's ten year standard model of
forecasted results extending through 2022 continues to reflect ultimate
profitability for the book of business. Accordingly, the establishment of a
premium deficiency reserve as of December 31, 2012 is unwarranted.

The indicated positive outcome of the ten year standard model notwithstanding,
it is more likely than not that MI operating results for 2013 and 2014 will be
negative. As long as the run-off under NCDOI supervision remains in place,
however, the statutory DPO accounting treatment should mitigate the adverse
effect of operating losses on the statutory capital balance. In these
circumstances, RMIC's and RMICNC's statutory solvency would be retained and
the risk of a regulatory receivership action would be averted. In management's
opinion, the DPO Plan under NCDOI supervision should be continued for a
sufficiently long period of time to achieve the objectives contemplated by the
above referenced NCDOI orders.

In light of all the above, the mortgage guaranty run-off will devolve within
constraints of Old Republic's currently committed capital resources. As of
December 31, 2012, the total statutory capital, inclusive of accumulated DPO
reserve funds of $299.5 held in RFIG's mortgage insurance subsidiaries was
approximately $132.8. As of the same date, RFIG's consolidated GAAP
capitalization amounted to ($56.6) (or a negative capital contribution of
approximately 22 cents per Old Republic common share). Based on the
above-noted loss expectations for 2013 and 2014 it is most likely that the
RFIG consolidated GAAP capital account will reflect a continuing and
increasingly negative balance. Moreover, Old Republic will be required to
recognize RFIG's continuing net losses in its consolidated GAAP financial
statements. This GAAP financial reporting treatment will not, however,
diminish the Old Republic shareholders' real economic interests in the overall
enterprise. Nor will this treatment affect the liquidity of the Old Republic
parent holding company or that of its separately capitalized and organized
insurance companies and their individual abilities to meet their respective
obligations.

Corporate and Other Operations – The combination of a small life and accident
insurance business and the net costs associated with the parent holding
company and its internal services subsidiaries usually produce highly variable
results. Earnings variations posted by these relatively minor elements of Old
Republic's operations stem from volatility inherent to the small scale of the
life and accident insurance business, fluctuations in the costs of external
debt, and net interest expenses on intra-system financing agreements.
Corporate expenses since last year's second quarter benefited from lower
interest charges following the repayment of high cost convertible debt of $316
million in May of 2012. The combination of these various operating elements is
shown in the following table:

                        Corporate and Other Operations
                        Quarters Ended December 31,  Years Ended December 31,
                        2012        2011     Change  2012     2011      Change
Life & accident         $  13.5     $ 14.9   -9.0%   $ 58.6   $ 74.9    -21.8%
premiums earned
Net investment income      2.1        2.2    -6.4      7.9      7.4     6.6
Other income               0.3        0.5    -43.7     1.8      2.4     -27.0
Benefits and claim         9.0        8.5    5.7       38.3     38.5    -0.6
costs
Insurance expenses         6.6        7.1    -7.2      26.8     39.4    -32.0
Corporate and other        (2.2)      5.6    -140.0    6.0      21.5    -72.1
expenses-net
Pretax operating income $  2.6      $ (3.5)  174.7%  $ (2.7)  $ (14.6)  75.1%
(loss)

Cash, Invested Assets, and Shareholders' Equity – The table below reflects Old
Republic's consolidated cash and invested assets as well as shareholders'
equity account at the dates shown:

                                      Cash, Invested Assets, and Shareholders'
                                      Equity
                                      December 31,
                                      2012            2011           Change
Cash and invested        Fair value   $   10,800.6    $  10,685.2    1.1%
assets:                  basis
                         Original     $   10,071.4    $  10,081.8    -0.1%
                         cost basis
Shareholders' equity:  Total          $   3,596.2     $  3,772.5     -4.7%
                       Per common     $   14.03       $  14.76       -4.9%
                       share
Composition of shareholders' equity
per share:
 Equity before items below         $   12.15       $  13.13       -7.5%
Unrealized investment gains (losses)
and other
accumulated comprehensive income          1.88           1.63
(loss)
Total                                 $   14.03       $  14.76       -4.9%
Segmented composition of

shareholders' equity per share:
Excluding run-off segment             $   14.25
RFIG run-off segment                      (0.22)
Total                                 $   14.03

Consolidated cash flow from operating activities was positive at $532.0 for
the year ended December 31, 2012 compared to a deficit of $94.9 sustained in
2011.

The consolidated investment portfolio reflects a current allocation of
approximately 93 percent to fixed-maturity securities and short-term
investments, and 7 percent to equities. As has been the case for many years,
Old Republic's invested assets are managed in consideration of enterprise-wide
risk management objectives. Most importantly, these are intended to assure
solid funding of its insurance subsidiaries' long-term obligations to
policyholders and other beneficiaries, and the necessary long-term stability
of capital accounts.

The investment portfolio contains no significant insurance risk-correlated
asset exposures to real estate, mortgage-backed securities, collateralized
debt obligations ("CDO's"), derivatives, junk bonds, hybrid securities, or
illiquid private equity investments. In a similar vein, the Company does not
engage in hedging or securities lending transactions, nor does it invest in
securities whose values are predicated on non-regulated financial instruments
exhibiting amorphous or unfunded counter-party risk attributes.

As the next table shows, substantially all changes in the shareholders' equity
account reflect the Company's net income or loss, dividend payments to
shareholders, and changes in the value of invested assets carried at fair
value.

                                                Shareholders' Equity Per Share
                                                December 31,
                                                2012        2011       2010
Beginning balance                               $  14.76    $  16.16   $ 16.49
Changes in shareholders' equity:
Net operating income (loss)                        (.39)       (.86)     (.16)
Net realized investment gains (losses):
From sales                                         .12         .44       .29
From impairments                                   -           (.13)     -
Subtotal                                           .12         .31       .29
Net unrealized investment gains (losses)           .29         .03       .40
Total realized and unrealized investment gains     .41         .34       .69
(losses)
Cash dividends                                     (.71)       (.70)     (.69)
Stock issuance, foreign exchange, and other        (.04)       (.18)     (.17)
transactions
Net change                                         (.73)       (1.40)    (.33)
Ending balance                                  $  14.03    $  14.76   $ 16.16

Conference Call Information

Old Republic has scheduled a conference call at 3:00 p.m. ET (2:00 p.m. CT)
today, to discuss its fourth quarter and full year 2012 performance and to
review major operating trends and business developments. To access this call
live in listen-only mode:

  oLog on to the Company's website at www.oldrepublic.com 15 minutes before
    the call to download the necessary software, or, alternatively
  othe call can also be accessed by phone at 888-539-3678.

Interested parties may also listen to a replay of the call through January 31,
2013 by dialing 877-870-5176, passcode 4869305, or by accessing it on Old
Republic International's website through February 24, 2013.

About Old Republic

Chicago-based Old Republic International Corporation is one of the nation's 50
largest publicly held insurance organizations. Its most recent financial
statements reflect consolidated assets of approximately $16.22 billion and
common shareholders' equity of $3.59 billion, or $14.03 per share. Its current
stock market valuation is approximately $3.0 billion, or $11.66 per share.

The Company is organized as an insurance holding company whose subsidiaries
actively market, underwrite, and provide risk management services for a wide
variety of coverages mostly in the general and title insurance fields. A
long-term interest in mortgage guaranty and consumer credit indemnity lines
has devolved to a run-off operating mode in recent years.

The nature of Old Republic's business requires that it be managed for the long
run. For the 25 years ended in 2012, the Company's total market return, with
dividends reinvested, has grown at a compounded annual rate of 10.8 percent
per share. For the same period, the total market return, with dividends
reinvested, for the S&P 500 Index has grown at a 9.7 percent annual compound
rate. During those years, Old Republic's shareholders' equity account,
inclusive of cash dividends, has risen at an average annual rate of 10.0
percent per share, and the regular cash dividend has grown at a 9.8 percent
annual compound rate. According to the most recent edition of Mergent's
Dividend Achievers, Old Republic is one of just 94 qualifying companies, out
of thousands considered, that have posted at least 25 consecutive years of
annual dividend growth.

Accompanying Financial Data:

  oSummary Financial Statements and Common Stock Statistics
  oSafe Harbor Statement

Financial Supplement

A financial supplement to this news release is available on the Company's
website.

Old Republic International Corporation
SummaryFinancial Statements and Common Stock Statistics (Unaudited)
                                                         December 31,
SUMMARY BALANCE SHEETS:                                  2012           2011
Assets:
Cash and fixed maturity securities                       $ 9,932.4      $ 9,962.5
Equity securities                                          739.7          580.8
Other invested assets                                      128.4          141.7
Cash and invested assets                                   10,800.6       10,685.2
Accounts and premiums receivable                           1,134.7        1,039.0
Federal income
tax            Current                                     71.9           73.5
recoverable:
               Deferred                                    148.1          116.7
Reinsurance balances recoverable                           3,237.1        3,243.9
Sundry assets                                              834.1          891.9
Total                                                    $ 16,226.8     $ 16,050.4
Liabilities and Shareholders' Equity:
Policy liabilities                                       $ 1,566.3      $ 1,461.9
Benefit and claim reserves                                 9,303.3        8,786.6
Debt                                                       572.9          912.8
Sundry liabilities                                         1,188.0        1,116.3
Shareholders' equity                                       3,596.2        3,772.5
Total                                                    $ 16,226.8     $ 16,050.4
                          Quarters Ended                 Years Ended
SUMMARY INCOME            December 31,                   December 31,
STATEMENTS:
                          2012           2011            2012           2011
Net premiums and fees     $ 1,169.5      $  1,062.0      $ 4,471.0      $ 4,050.1
earned
Net investment income       83.6            89.1           336.5          364.6
Other income                25.8            28.6           114.5          115.2
Net realized investment     4.2             127.6          47.8           115.5
gains (losses)
Total revenues              1,283.2         1,307.4        4,970.1        4,645.5
Benefits and claims         692.4           690.8          2,765.3        2,764.3
Sales and other expenses    627.3           537.3          2,333.3        2,117.8
Total expenses              1,319.7         1,228.1        5,098.7        4,882.2
Pretax income (loss)        (36.4)          79.2           (128.5)        (236.7)
Income taxes (credits)      (16.2)          24.0           (59.8)         (96.1)
Net income (loss)         $ (20.2)       $  55.2         $ (68.6)       $ (140.5)
COMMON STOCK STATISTICS:
Net
income  Basic             $ (.08)        $  .22          $ (.27)        $ (.55)
(loss):
        Diluted           $ (.08)        $  .22          $ (.27)        $ (.55)
Components of earnings
per share:
Basic, net operating      $ (.09)        $  (.11)        $ (.39)        $ (.86)
income (loss)
Realized investment         .01             .33            .12            .31
gains (losses)
Basic net income (loss)   $ (.08)        $  .22          $ (.27)        $ (.55)
Diluted, net operating    $ (.09)        $  (.11)        $ (.39)        $ (.86)
income (loss)
Realized investment         .01             .33            .12            .31
gains (losses)
Diluted net income        $ (.08)        $  .22          $ (.27)        $ (.55)
(loss)
Cash dividends on common  $ .1775        $  .1750        $ .7100        $ .7000
stock
Book value per share                                     $ 14.03        $ 14.76
Common shares
outstanding:
Average basic               256,086,431     255,292,231    255,812,888    255,045,210
Average diluted             256,086,431     255,597,983    255,812,888    255,045,210
Actual, end of period                                      256,392,462    255,681,677
SUMMARY STATEMENTS OF COMPREHENSIVE INCOME (LOSS):
Net income (loss) as      $ (20.2)        $ 55.2         $ (68.6)       $ (140.5)
reported
Post-tax net unrealized     (10.8)          (31.7)         73.8           7.5
gains (losses)
Other adjustments           (19.1)          (39.1)         (8.2)          (50.6)
Net adjustments             (29.9)          (70.9)         65.6           (43.0)
Comprehensive income      $ (50.2)       $  (15.6)       $ (3.0)        $ (183.5)
(loss)

Safe Harbor Statement

Historical data pertaining to the operating results, liquidity, and other
performance indicators applicable to an insurance enterprise such as Old
Republic are not necessarily indicative of results to be achieved in
succeeding years. In addition to the factors cited below, the long-term nature
of the insurance business, seasonal and annual patterns in premium production
and incidence of claims, changes in yields obtained on invested assets,
changes in government policies and free markets affecting inflation rates and
general economic conditions, and changes in legal precedents or the
application of law affecting the settlement of disputed and other claims can
have a bearing on period-to-period comparisons and future operating results.

Some of the oral or written statements made in the Company's reports, press
releases, and conference calls following earnings releases, can constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Of necessity, any such forward-looking
statements involve assumptions, uncertainties, and risks that may affect the
Company's future performance. With regard to Old Republic's General Insurance
segment, its results can be affected, in particular, by the level of market
competition, which is typically a function of available capital and expected
returns on such capital among competitors, the levels of interest and
inflation rates, and periodic changes in claim frequency and severity patterns
caused by natural disasters, weather conditions, accidents, illnesses,
work-related injuries, and unanticipated external events. RFIG run-off and
Title Insurance results can be affected by similar factors, and by changes in
national and regional housing demand and values, the availability and cost of
mortgage loans, employment trends, and default rates on mortgage loans. RFIG
run-off results, in particular, may also be affected by various mortgage
guaranty risk-sharing arrangements with business producers, as well as the
risk management and pricing policies of government sponsored enterprises. Life
and accident insurance earnings can be affected by the levels of employment
and consumer spending, variations in mortality and health trends, and changes
in policy lapsation rates. At the parent holding company level, operating
earnings or losses are generally reflective of the amount of debt outstanding
and its cost, interest income on temporary holdings of short-term investments,
and period-to-period variations in the costs of administering the Company's
widespread operations.

A more detailed listing and discussion of the risks and other factors which
affect the Company's risk-taking insurance business are included in Part I,
Item 1A - Risk Factors, of the Company's 2011 Form 10-K annual report and Part
II, Item 1A - Risk Factors, of the Company's most recent Form 10-Q quarterly
report to the Securities and Exchange Commission, which Items are specifically
incorporated herein by reference.

Any forward-looking statements or commentaries speak only as of their dates.
Old Republic undertakes no obligation to publicly update or revise any and all
such comments, whether as a result of new information, future events or
otherwise, and accordingly they may not be unduly relied upon.

For the latest news releases and other corporate documents on Old Republic:
Please write to:
Investor Relations
Old Republic International Corporation
307 North Michigan Avenue
Chicago, IL 60601
312-346-8100
or visit us at www.oldrepublic.com

SOURCE Old Republic International Corporation

Website: http://www.oldrepublic.com
Contact: At Old Republic, A. C. Zucaro: Chairman & CEO, (312) 346-8100; or At
Financial Relations Board, Analysts/Investors: Scott Eckstein, (212) 827-3766
 
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