EIHI is the parent company of Eastern Life and Health Insurance Company("Eastern Life and Health"), which converted from mutual to stock form on June16, 2006. The Pennsylvania Insurance Department's order approving theconversion prohibits both Eastern Life and Health and EIHI from making anydistribution to shareholders without prior Pennsylvania Insurance Departmentapproval for a period of three years. EIHI sought and received PennsylvaniaInsurance Department approval for this quarterly dividend. It is the presentintent of EIHI to seek approval from the Pennsylvania Insurance Department forfuture quarterly dividends during the remaining six (6) months that it issubject to this Pennsylvania Insurance Department order if economic conditionsand EIHI's financial performance warrant. No assurance can be given, however,that any such permission, if sought, will be received.

EIHI operates through its subsidiaries a domestic casualty insurance groupspecializing in workers' compensation, a domestic life and health insurancecompany, an offshore specialty reinsurance company and a third-party claimsadministration company.

EIHI is located at 25 Race Avenue in Lancaster, Pennsylvania. EIHI's Webaddress is http://www.easterninsuranceholdings.com.

FORWARD LOOKING STATEMENTS

Some of the statements contained in this press release are "forward-looking statements" within the meaning of the Private Securities LitigationReform Act of 1995. In some cases, you can identify forward-lookingstatements by terminology such as "may," "will," "should," "expect,""project," "plan," "intend," "anticipate," "believe," "estimate," "predict,""potential" or "continue," the negative of these terms or other terminology.Forward-looking statements are based on the opinions and estimates ofmanagement at the time the statements are made and are subject to certainrisks and uncertainties that could cause actual results to differ materiallyfrom those anticipated in the forward-looking statements, therefore noassurance can be given that management's expectations, beliefs or projectionswill occur or be achieved or accomplished. Factors that could affect theCompany's actual results include, among others, the fact that our lossreserves are based on estimates and may be inadequate to cover our actuallosses; the uncertain effects of emerging claim and coverage issues on ourbusiness; the geographic concentration of our business; an inability to obtainor collect on our reinsurance protection; a downgrade in the A.M. Best ratingof our insurance subsidiaries; the impact of extensive regulation of theinsurance industry and legislative and regulatory changes, a failure torealize our investment objectives; the effects of intense competition; theloss of one or more principal employees; the inability to acquire additionalcapital on favorable terms; a failure of independent insurance brokers toadequately market our products; and the effects of acts of terrorism or war.More information about these and other factors that potentially could affectour financial results is included in our Form S-1 Registration Statement,filed with the U.S. Securities and Exchange Commission and in our other publicfilings with the U.S. Securities and Exchange Commission. Readers arecautioned not to place undue reliance upon these forward-looking statements,which speak only as of the date of this release. The Company undertakes noobligation to update any forward-looking statements. This press release alsodoes not constitute an offer to sell, or a solicitation of an offer to buy,EIHI securities. Such an offer will be made only by means of a prospectus.

SOURCE Eastern Insurance Holdings, Inc.