Question-and-Answer Session
(Operator Instructions)
Operator
Your first question comes from the line of Elizabeth Malone of Keybanc.
Elizabeth Malone - Keybanc Capital Mkts
I want to get a little bit clarification on your comments that, there were some economic pressures in certain markets that where having an impact on your top line. Could you give us a little bit more color? Are we talking about residential construction or other types of businesses?
Jack Schiff
It is really across the board for liability coverages but I think when you get into particular policies and geographic areas, I like for JF to talk about it more specifically.
Jacob Scherer Jr.
Not bad but thank you and you have hit it. Certainly throughout the country on the residential side, everyone knows that there is abating of a new construction. We like to turn them out construction, 43% of our general liability premiums are in the construction area, 46% is in workers com. Those ticker lines of business are based on payroll and sales. So, as we observe it on the commercial line side, commercial constructions side, particularly in the areas of government construction, road builders and things of that nature, that is holding up reasonably well, but on the residential side it is obviously to everyone taking a bit of a hit.
Elizabeth Malone - Keybanc Capital Mkts
As far as that pricing pressure that you are seeing. I know that your strategy has always been the focus on your agent relationships. Is there something else or is that a tried improved formula in a market like this that you can rely upon, to kind of keep your business a little bit more intact, or are there new things you are trying other than E&S would be one example but could you give us some color on that?
Jacob Scherer Jr.
Well, our strategy to work closely with our agency is to try to improve strength of the company. We continue to leverage whether it is our field underwriters, lost control, field claims, machine and equipment, all of our field associates to call on our agencies discerning which accounts to write work together to make sure that we are renewing the right accounts and we think that is the way we to do it.
We are on the spot, it seems the policy always on working very closely to decide which accounts are worthy of renewing, and which accounts are worthy of additional crediting. What we continue to do is we appointed our last two years, 121 agencies, so each year of this past year, 66 agencies was recorded. We were targeting 65 to 2008. We selectedly pick agents to complement the rest of our agencies in the 34 states we do business in. We think a great opportunity in terms of the quality of the agency that we would like to do business with us. It is a balance! We have many agencies that do a great deal of business with us in geographic areas. They are working through the just as we are, and so we support them. Certainly though, excess and surplus lines and the return of the momentum and personal lines are going to be two items that we think are going to contribute as time goes on.
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