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SEC LETTER

June 2, 2005

James B. Rosenberg

Senior Assistant Chief Accountant

Division of Corporation Finance

United States Securities and

Exchange Commission

450 Fifth Street, N.W.

Washington, D.C. 20549

    Re:
    ProAssurance Corporation
Form 10-K for the Year Ended December 31, 2004

Dear Mr. Rosenberg:

     We are in receipt of your letter dated May, 3, 2005 and appreciate your comments on the Annual
Report on Form 10-K of ProAssurance Corporation (the “Company”) for the year ended December 31,
2004. We are always looking to improve the financial disclosures that we make as a part of our
public filings and look forward to working with you on the enhancements outlined in your letter.

     We will respond to each comment and amend the disclosures in our Form 10-K for the year ended
December 31, 2004 as outlined below. Our responses are in the sequence of the comments in your
letter, and each comment is reprinted prior to our response in order to aid your review.

     The adequacy and accuracy of the disclosure in our filings is the responsibility of the
Company. We acknowledge that Staff comments or changes in response to Staff comments in the
proposed disclosure in the Form 10-K do not foreclose the Commission from taking any action with
respect to the filing. We also acknowledge that Staff comments may not be asserted as a defense in
any proceeding initiated by the Commission or any person under the Federal securities laws of the
United States.

     1.       Critical Accounting Policies – Reserve for Losses and Loss Adjustment Expenses, page
28.

     We believe your disclosure in Management’s Discussion and Analysis regarding the reserve for
loss and loss adjustment expenses could be improved to better explain the judgments and
uncertainties surrounding this estimate and the potential impact on your financial statements. We
believe that disclosures explaining the likelihood that materially different amounts would be
reported under different conditions or using different assumptions is consistent with the objective
of Management’s Discussion and Analysis. Accordingly, please revise MD&A to include the following
information for each of your lines of business.

James B. Rosenberg

June 2, 2005

Page 2

_________________________

           a.       Please disclose the reserves accrued as of the latest balance sheet date presented. The
total of these amounts should agree to the amount presented on the balance sheet.

Response:

Please see our response to question 1d below.

           b.       Please disclose the range of loss reserve estimates as determined by your actuaries.
Discuss the key assumptions used to arrive at management’s best estimate of loss reserves within
that range and what specific factors led management to believe this amount rather than any other
amount within the range represented the best estimate of incurred losses. Include quantified and
narrative disclosure of the impact that reasonably likely changes in one or more of the variables
(i.e. actuarial method and/or assumptions used) would have on reported results, financial position
and liquidity.

Response:

Please see our response to question 1c below.

           c.       If you do not calculate a range around your loss reserve, but instead use point estimates
please include the following disclosures:

    •
    Disclose the various methods considered and the method that was selected to
calculate the reserves. If multiple point estimates are generated, include the
range of these point estimates. Include a discussion of why the method
selected was more appropriate over the other methods.

    •
    Discuss how management determined the most appropriate point estimate and
why the other point estimates were not chosen. Also clarify whether the
company actually records to the point estimate or if not, how that estimate is
used.

    •
    Include quantified and narrative disclosure of the impact that reasonably
likely changes in one or more of the variables (i.e. actuarial method and/or
assumptions used) would have on reported results, financial position and
liquidity.

Response:

As discussed with the Staff in our telephone conversation on May 5, our current
actuarial process does not include the determination of a range. We appreciate the
Staff’s interest in having us provide a range and we are in the

James B. Rosenberg

June 2, 2005

Page 3

_________________________

process of studying
the issue of incorporating explicit ranges or sensitivity analysis into this
process. It is our intention to include this information in future filings upon our
completion of the analysis.

We intend to amend our Form 10-K to include a more robust discussion of the
methods used in determining the point estimate of our reserves. In addition we will
provide a discussion on the significant assumptions that are used in our analysis of
loss reserves. We will enhance the discussion of loss reserves included in the loss
reserve discussion in our Form 10- (Page 35) to read substantially as follows:

The estimation of losses is inherently difficult. In establishing
these reserves management considers a variety of factors including
historical paid and incurred loss development trends, the effect of
inflation on medical care, general economic trends and the legal
environment. Given the number of factors considered it is neither
practical nor meaningful to isolate a particular assumption or
parameter of the process and calculate the impact of changing that
single item. We perform an in-depth review of our loss reserves on
a semi-annual basis. However, management is continually reviewing
and updating the data underlying the estimation of its loss reserves
and we make adjustments that we believe the emerging data indicates.
Any adjustments necessary are reflected in the then current
operations.

As result of the variety of factors that must be considered by
management there is a significant risk that actual incurred losses
will develop differently from these estimates. As shown in the
reserve development table on page 37 the original estimates of our
loss reserves have developed to-date to be redundant in eight of the
last ten years and deficient in two of the last ten years.

The Company uses a variety of actuarial methodologies in performing
these analyses. Among the methods that have been used by the
Company are:

    •
    Paid development method

    •
    Reported development method

    •
    Bornhuetter-Ferguson method (professional liability)

James B. Rosenberg

June 2, 2005

Page 4

_________________________

    •
    Average paid value method (professional liability)

    •
    Average reported value method (professional liability)

    •
    Backward recursive method (professional liability)

    •
    Paid Cape Cod method (personal lines)

    •
    Incurred Cape Cod method (personal lines)

    •
    Expected loss ratio method (personal lines)

Generally, methods such as the Bornhuetter-Ferguson method and the
Cape Cod method are used on more recent accident years where we have
less development on which to base our analysis. As business seasons
and we have an increased amount of data for a given accident year we
begin to give more confidence to the development and average methods
as these methods typically rely more heavily on our own historical
data. Each method is used because it has its own set of assumptions
or provides a different perspective on the particular business under
review.

In addition, we perform statistical reviews of claim data such as
claim counts, average settlement costs and severity trends.

In performing these analyses we partition our business by type,
coverage type, geography, layer of coverage and accident year. This
procedure is intended to balance the use of the most representative
data for each partition, capturing its unique patterns of
development and trends. For each partition the results of the
various methods, along with the supplementary statistical data
regarding such factors as the current economic environment are used
to develop a point estimate based upon management’s judgment and
past experience. The process of selecting the point estimate from
the set of possible outcomes produced by the various actuarial
methods is based upon the judgment of management and is not driven
by formulaic determination. For each partition of our business we
select a point estimate with due regard for the age, characteristics
and volatility of the partition of the business, the volume of data
available for review and past experience with respect to the
accuracy of estimates for business of a similar type. This series
of selected point estimates is then combined to produce an overall
point estimate for ultimate losses for each segment of our
operations.

James B. Rosenberg

June 2, 2005

Page 5

_________________________

In order to provide additional information regarding the loss
estimation process, we are in the process of developing a
sensitivity analysis that will help to highlight the potential
variability of our estimates and will disclose them in future
reports when we have completed our analysis.

           d.       Because IBNR reserve estimates are more imprecise, please disclose the amount of IBNR
separately from case reserved for each line of business.

Response:

We will enhance the disclosure of losses by segment as follows:

    Case Reserves

    IBNR

    Total Reserves

    Professional Liability

    $
    979,893

    $
    838,742

    $
    1,818,635

    Personal Lines

    116,000

    94,956

    210,956

    Total Gross Loss Reserves

    $
    1,095,894

    $
    933,698

    $
    2,029,592

     Liquidity and Capital Resources and Financial Condition, page 30

     2.       We note that in 2002 you sold a significant portion of your fixed maturity portfolio in
order to realize capital gains and that the proceeds from these sales were reinvested during 2003
at substantially lower rates. Please expand your liquidity discussion to disclose what
management’s investment strategy is when certain economic conditions persist, i.e. low
interest-rate environment, and the impact this will have on your investment portfolio. Please
include in your discussion the impact that these economic conditions may have on your results of
operations, i.e. realized gains or losses and investment income, and liquidity, i.e. investment
turnover and yields.

Response:

The sale of securities in 2002 was due to a very specific set of circumstances. At
that time we carried a portion of our equity securities within the investment
portfolio of our insurance subsidiaries. In an effort to maintain the insurance
subsidiaries’ statutory surplus, we sold fixed income securities (which are carried
at amortized cost under statutory accounting rules) at a gain to offset the impact
of a decline in the value of the subsidiaries’ equity
portfolios (which are carried at market under statutory accounting rules). Under
our current investment guidelines, we no longer maintain a significant portion of
our equity securities in the investment portfolios of our insurance subsidiaries.

James B. Rosenberg

June 2, 2005

Page 6

_________________________

The liquidity and capital resources section of our MD&A will be amended to include
the following discussion:

Our investment strategy is not typically impacted by current
economic conditions. Our investment strategy is focused on two
principal long-term investment objectives: maximizing after-tax
investment income through the prudent investment in income yielding
securities and the preservation of capital through a focus on the
total return of the investment portfolio. In achieving these
objectives we have established a set of investment guidelines.
These guidelines include parameters for the quality and duration of
the investments purchased by us. Current economic conditions may
influence how we attempt to achieve these two objectives; however,
we must work within its established guidelines. For example, in a
low interest rate environment the Company generally shortens the
duration of its fixed maturity portfolio to protect its capital from
decreases in value resulting from rising interest rates. In a
period of higher rates we are willing to invest in longer duration
securities (within the parameters of our investment guidelines) in
order to achieve higher investment income with less risk to the
value of our capital. The impact of changing interest rates and
economic conditions on the Company’s investment portfolio is further
discussed under Item 7A. Quantitative and Qualitative Disclosure
About Market Risk.

     3.       Please include in MD&A a more robust discussion of the reasonably likely impact the payment
of claims will have on known trends and uncertainties, in particular cash outflows from operations.
In the disclosure please include a discussion of your asset/liability management process and
whether there are any significant variations between the maturity of your investments and the
expected payment of your loss reserves. Include a discussion of the impact of selling securities
before anticipated or the use of credit facilities to pay for policy liabilities will have on your
future liquidity and results of operations.

Response:

The liquidity and capital resources section of our MD&A will be amended to include
the following discussion:

We manage our investment portfolio to ensure that it will have
sufficient liquidity to meet its obligations. In performing this

James B. Rosenberg

June 2, 2005

Page 7

_________________________

analysis we consider the timing of maturity of the investments in
our investment portfolio as well as the expected cash flows to be
generated by our operations. In 2003 and 2004 we had operating cash
flow of $282.8 million and $373.5 million, respectively. At our
insurance subsidiaries the primary outflow of cash is related to the
payment of claims and claims expenses. The payment of individual
claims cannot be predicted with certainty; therefore, we rely upon
the history of its paid claims in determining the expected payout of
its loss reserves. To the extent that we have an unanticipated
shortfall in cash we can either liquidate securities held in our
investment portfolio or borrow funds under previously established
borrowing arrangements. However, given the significant cash flows
being generated by our operations and the relatively short duration
of our investment portfolio we do not currently foresee any such
shortfall.

     Contractual Obligations, page 33

     4.       We note that the Company has not included its loss reserve to be paid in the contractual
obligation table, and it would appear that these liabilities represent future legal obligations of
the Company. Due to the significant nature of these liabilities to your business we believe the
inclusion of reserves in the contractual obligation table will provide investors increased
disclosure of your liquidity. The purpose of Financial Reporting Release 67 is to obtain enhanced
disclosure concerning a registrant’s contractual payment obligations and the exclusions of ordinary
course items would be inconsistent with the objective of the Item 303(a)(5) of Regulation S-K.
Based on the above factors, please revise your contractual obligation table to include the expected
settlement of your loss reserves. In addition please revise your liquidity and capital resources
discussion to address the impact of the factors that impact liquidity at the subsidiary level
including the impact of these payments on that liquidity.

Response:

Please see our response to question 5 below and to our response to question 3
regarding liquidity and capital resources.

     5.       It appears that scheduled interest payments on long-term debt are excluded from the table.
Please include interest payments in the table or disclose, and explain to us, why interest paymen