Financial highlights for the quarter included:

• Gross premiums written increased 26% to $72.6 million.
• Net premiums written increased 29% to $57.2 million.
• Net premiums earned increased 22% to $48.1 million.
• Investment income decreased 2% to $7.3 million.
• Combined ratio increased to 103.7% compared to 94.4% for the same period of 2007.
• Loss ratio was 63.1% compared to 59.9% for the same period of 2007.
• Expense ratio increased to 40.6% from 34.5% for the same period of 2007.
• Annualized return on average equity declined to 11.2% from 14.1%.
• Book value per share increased to $21.92 per outstanding share and $21.35 per diluted share compared to $21.53 and $20.81, respectively, as of December 31, 2007.

Second Quarter Results

The 7% decline in net earnings in the second quarter is the result of the impact of the soft insurance market on underwriting profit driven by declines in our construction line and other changes in the mix of our business. Premium writings for the quarter included a greater contribution from newer products added as a part of the Company’s diversification strategy and which currently have lower margins than our more mature products.

Revenues for the quarter were $56.6 million, compared to $47.6 million for the 2007 quarter. Net premiums earned totaled $48.1 million, an increase of $8.7 million, primarily due to increased writings in assumed reinsurance and increased retention levels in the specialty program line. Investment income was $7.3 million, compared to $7.5 million for the 2007 quarter. Average invested assets increased to $601 million from $570 million at June 30, 2007 while the average yield on the portfolio declined 40 basis points to 4.9%.

The expense ratio increase for the quarter was primarily a result of higher acquisition expenses due to the change in the mix of business. The loss ratio increase includes $1.5 million of prior year development primarily relating to New York risks written in the middle market segment of our environmental product line. We have substantially reduced environmental premiums in New York over the past two years. Corporate and other expenses decreased $2.8 million primarily due to a reversal of an accrued expense in our non-insurance segment.

Year to Date Results

Net earnings for the six months ended June 30, 2008 were $12.8 million, or $1.18 per diluted share, compared to $14.4 million, or $1.31 per diluted share, for the same period of 2007. Total revenues increased $9.4 million primarily due to an increase in net earned premiums for the period. The increase in net premiums earned was primarily due to increased writings in assumed reinsurance and increased retention levels in the specialty program line. The combined ratio for the six months ended June 30, 2008 was 102.2% composed of a 60.8% loss ratio and a 41.4% expense ratio. The 2007 combined ratio was 95.0% composed of a loss ratio of 61.2% and an expense ratio of 33.8%.

Average invested assets increased 4.6% over June 30, 2007. The pre-tax investment yield decreased 40 basis points to 4.8% as compared to 5.2% for the same period of 2007. Book value for the six months increased 1.8% per outstanding share and 2.6% per diluted share despite a $9.8 million increase in unrealized losses for the period.

Commenting on the results, Stephen R. Crim, President and Chief Executive Officer said, “Gross and net premiums written increased by 12% and 15% respectively for the first six months of 2008, driven by premium growth from lines of business added since 2006 in connection with our product diversification strategy. These newer products generated $45.5 million of gross premiums written through June, compared to $17.8 million for the same period in 2007. The largest contributor to growth was assumed reinsurance, which produced $28.6 million. I am pleased with the progress in broadening our product platform, which has allowed us to achieve growth in a competitive insurance market while maintaining underwriting discipline. This platform positions the Company for meaningful growth and improved profitability when market conditions improve.”

Conference Call

A conference call to discuss second quarter 2008 results is scheduled for Monday, July 28, 2008 at 9:00 a.m. (Eastern Daylight Time), which will be broadcast through Vcall’s Investor Calendar at www.investorcalendar.com, or the Company’s website at www.amsafety.com. If you are unable to participate at this time, a replay will be available for 30 days, beginning approximately two hours after the call. A transcript of the call will be available on the Company’s website beginning several days after the call.

This report contains forward-looking statements. These forward-looking statements reflect the Company's current views with respect to future events and financial performance, including insurance market conditions, premium growth, acquisitions and new products and the impact of new accounting standards. Forward-looking statements involve risks and uncertainties which may cause actual results to differ materially, including competitive conditions in the insurance industry, levels of new and renewal insurance business, developments in loss trends, adequacy and changes in loss reserves and actuarial assumptions, timing or collectability of reinsurance recoverables, market acceptance of new coverages and enhancements, changes in reinsurance costs and availability, potential adverse decisions in court and arbitration proceedings, the integration and other challenges attendant to acquisitions, and changes in levels of general business activity and economic conditions.

About Us:

American Safety Insurance Holdings, Ltd. (NYSE:ASI), a Bermuda holding company, offers innovative insurance solutions outside the U.S. in the reinsurance and alternative risk markets through its subsidiaries, American Safety Reinsurance, Ltd. and American Safety Assurance, Ltd., and in the U.S. for specialty risks and alternative risk markets through its program administrator, American Safety Insurance Services, Inc., and insurance company subsidiaries and affiliates, American Safety Casualty Insurance Company, American Safety Indemnity Company and American Safety Risk Retention Group, Inc. As a group, ASI’s insurance subsidiaries and affiliates are rated "A" (Excellent) VIII by A.M. Best.

American Safety Insurance Holdings, Ltd. and Subsidiaries
Financial and Operating Highlights
(Unaudited)
(in thousands except per share data and percentages)
			Three Months Ended								Six Months Ended
			June 30,								June 30,
			2008				2007				2008				2007
INCOME STATEMENT DATA:
Revenues:
Direct premiums earned		$	47,903			$	55,280			$	94,271			$	110,402
Assumed premiums earned			14,419				1,653				22,113				3,165
Ceded premiums earned			(14,180	)			(17,522	)			(30,193	)			(35,799	)
Net premiums earned			48,142				39,411				86,191				77,768
Net investment income			7,316				7,482				14,643				14,706
Net realized gains (losses)			291				(27	)			795				(8	)
Fee income			791				748				1,518				1,264
Other income			16				15				30				32
Total revenues			56,556				47,629				103,177				93,762
Expenses:
Losses and loss adjustment expenses			30,380				23,622				52,410				47,574
Acquisition expenses			11,962				7,728				21,038				13,846
Payroll and related expenses			5,605				4,522				10,246				8,676
Other underwriting expenses			2,770				2,083				5,932				4,997
Interest Expense			824				822				1,655				1,638
Corporate and other expenses			(1,883	)			922				(1,309	)			1,435
Minority interest			14				9				152				124
Total expenses			49,672				39,708				90,124				78,290
Earnings before income taxes			6,884				7,921				13,053				15,472
Income taxes			95				649				243				1,108
Net earnings		$	6,789			$	7,272			$	12,810			$	14,364
Net earnings per share:
Basic		$	0.64			$	0.69			$	1.21			$	1.36
Diluted		$	0.63			$	0.66			$	1.18			$	1.31
Weighted average number of shares outstanding:
Basic			10,543,397				10,605,708				10,619,552				10,580,917
Diluted			10,803,446				10,974,296				10,896,841				10,952,738
GAAP combined ratio			103.7	%			94.4	%			102.2	%			95.0	%
BALANCE SHEET DATA:											June 30, 2008				December 31, 2007
											(in millions except per share data)
Total investments										$	597			$	617
Total assets											959				934
Unpaid losses and loss adjustment expenses											538				505
Total liabilities											729				704
Total shareholders' equity											230				230
Book value per share										$	21.92			$	21.53

American Safety Insurance Holdings, Ltd. and Subsidiaries
Financial and Operating Highlights
(Unaudited)
(in thousands )
			Three Months Ended						Six Months Ended
			June 30,						June 30,
			2008			2007			2008			2007
PREMIUM SUMMARY (in Thousands)
Gross Premiums Written:
Excess and Surplus Lines Segment
Environmental		$	13,085		$	11,844		$	26,332		$	24,982
Construction			11,206			16,930			20,070			32,923
Excess			1,869			1,227			4,330			3,196
Healthcare			3,362			-			5,103			-
Products Liability			1,748			2,047			3,113			2,859
Property			2,441			233			4,290			233
Surety			2,594			1,476			4,619			2,786
Total Excess and Surplus Lines Segment			36,305			33,757			67,857			66,979
Alternative Risk Transfer Segment
Specialty Programs			16,224			15,353			30,498			34,785
Total Alternative Risk Transfer Segment			16,224			15,353			30,498			34,785
Assumed Reinsurance Segment			20,102			8,742			28,628			11,511
Total Gross Premiums Written		$	72,631		$	57,852		$	126,983		$	113,275
Net Premiums Written:
Excess and Surplus Lines Segment
Environmental		$	9,694		$	9,363		$	18,620		$	20,111
Construction			8,689			16,811			14,902			32,513
Excess			410			156			632			417
Healthcare			2,185			-			3,317			-
Products Liability			1,411			1,024			2,491			1,429
Property			1,715			157			3,012			157
Surety			1,980			1,467			3,677			2,736
Total Excess and Surplus Lines Segment			26,084			28,978			46,651			57,363
Alternative Risk Transfer Segment
Specialty Programs			11,055			6,747			20,469			14,435
Total Alternative Risk Transfer Segment			11,055			6,747			20,469			14,435
Assumed Reinsurance Segment			20,102			8,742			28,628			11,511
Total Net Premiums Written		$	57,241		$	44,467		$	95,748		$	83,309
Net Premiums Earned:
Excess and Surplus Lines Segment
Environmental		$	9,223		$	10,024		$	17,829		$	19,550
Construction			10,335			18,895			20,688			39,259
Excess			183			184			363			411
Products Liability			1,168			482			2,183			943
Property			1,029			7			1,755			7
Surety			1,726			1,156			3,352			2,071
Healthcare			637			-			721			-
Total Excess and Surplus Lines Segment			24,301			30,748			46,891			62,241
Alternative Risk Transfer Segment
Specialty Programs			9,422			7,009			17,188			12,361
Total Alternative Risk Transfer Segment			9,422			7,009			17,188			12,361
Assumed Reinsurance Segment			14,419			1,653			22,112			3,166
Total Net Premiums Earned		$	48,142		$	39,410		$	86,191		$	77,768