October 2, 2006

Medicus Insurance Holdings, Inc. Secures Funding from The Cypress Group and CHL Medical Partners

New insurance company to target professional medical-liability market

Austin, TX – Medicus Insurance Holdings, Inc. announced today that it has entered into a financing arrangement with institutional investors for the issuance of up to $100 million of Series A Preferred Stock. Medicus and its operating subsidiary, Medicus Insurance Company, were formed in order to provide a new source of professional medical-liability insurance coverage to physicians in Texas and other states.

In the first round of funding Medicus Insurance Holdings, Inc. received $15 million, with subsequent rounds to support growth expected over the next three years. Sponsoring investors of Medicus are affiliates of The Cypress Group and CHL Medical Partners. The Medicus management team, led by Howard H. Lamb and Sheldon Davidow, has also made a significant investment in the company.

The Medicus management team has extensive industry experience and local roots in the Texas market. Over the course of his 50-year career in the insurance industry, Medicus CEO Howard Lamb served as CEO of The Doctors Company and held other senior leadership positions in the insurance industry. Medicus President and Chief Operating Officer Sheldon Davidow has over 25 years of insurance industry experience and has worked with Mr. Lamb previously as Executive Vice President of The Doctors Company. Charles W. Bailey, Jr., M.D., J.D., former President of the Texas Medical Association, will serve as the company’s Vice President of Medical Relations.

"Medicus offers the medical community a compelling combination of a highly experienced management team supported by a substantial capital base,” said Howard Lamb. “We look forward to becoming the insurer of choice for physicians in Texas and plan to earn their confidence by delivering quality, service, and value in our product offerings.” Speaking on behalf of the investor group, Walter Keenan of The Cypress Group said, “We congratulate Howard and Sheldon for assembling an extraordinary team of industry professionals at Medicus and for becoming a fully licensed and admitted carrier in the state of Texas. We are grateful for the encouraging response to Medicus’ startup from doctors and their agents, and look forward to supporting the company’s future growth.”

The shares of common stock and Series A Preferred Stock of Medicus Insurance Holdings, Inc. have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful.

About The Cypress Group
The Cypress Group is a New York-based private-equity sponsor managing two private-equity funds with over $3 billion of invested capital. Cypress insurance industry investments have included Montpelier Re Holdings, Ltd.; Catlin Group Limited.; Financial Guaranty Insurance Company (FGIC); Lancashire Holdings Limited; and Scottish Re Group Limited.

About CHL Medical Partners
CHL Medical Partners is a Stamford, Conn.-based venture-capital firm founded in 1990, managing funds with combined committed capital of more than $300 million. CHL has made over 70 early-stage private investments in the healthcare sector. More information about CHL may be found at www.chlmedical.com.

About Medicus Insurance Company
Medicus Insurance Holdings, Inc. is a Delaware holding company whose sole subsidiary, Medicus Insurance Company, offers malpractice insurance to physicians, surgeons, and related medical-service providers in the state of Texas. The Medicus leadership team is comprised of insurance and medical leaders dedicated to providing lower-priced malpractice coverage that supports and protects medical practitioners in today's complex healthcare environment.

Irving Levin Associates, Inc. -- Publisher

Health Care Finance Advantage

Health Care Finance News from Healthcare Corporate Finance News
Written by: Gretchen Swanson, Editor of the Healthcare Corporate Finance News

Key People Talk With Us About Top Deals (November 15, 2006)

The November issue of Healthcare Corporate Finance News highlights our conversations with key people involved in three of the largest recent venture capital deals. Medicus Insurance secured commitments of up to $100 million, of which it has received $15 million, so far. Medicus and its operating subsidiary, Medicus Insurance Company, were formed to provide a new source of professional medical liability (malpractice) insurance to physicians, surgeons and other medical providers in Texas and other states. CHL Medical Partners and Cypress Group invested in this initial round for Medicus, which we talked about with Walter Keenan of Cypress Group.

Macroflux Corporation, a newly established spin-out from ALZA Corporation, will continue the development of the Macroflux drug delivery system, which has been studied since 1990 to provide needle-free, transdermal delivery of therapeutic proteins, peptides and vaccines, initially for treating severe osteoporosis. Macruflux raised $75 million from Nomura Phase4 Ventures, New Enterprise Associates, HBM Partners and other investors. The company’s CEO is Judith Hemberger, who talked with us about the Macroflux system and how the proceeds from the financing will be used.

MedServe secured $70 million in equity funding, which will be used for further consolidation of local and regional operators in the medical waste industry. In the past 18 months, MedServe completed eight acquisitions and expects to make more. Investors in the round were led by Avista Capital Partners and included Murphree Venture Partners, Cogene Biotech Ventures and the Erasmus Louisiana Growth Fund, as well as ChrysalisVentures. Koleman Karleski of Chrysalis Ventures told us about why the firm invested in MedServe and also about the appeal of another company recently added to its portfolio, Chronicity, Inc., which is featured in our November issue too.

Healthcare Brands International (HBI) raised $47.5 million from Abingworth Management, 3i Group, MVM Limited and Sofinnova Partners. HBI is committed to acquiring, developing and investing in health care products and brands to optimize their commercial potential, focusing on consumer needs that are currently either unmet or only partially met by available OTC products. The first product HBI acquired and will commercialize is a nutraceutical with antiviral properties.

NovImmune SA secured $46 million in its Series B financing from investors led by BZ Bank and including Pictet Private Equity Investors, Lombard Odier Darier Hentsch, Novartis Venture Fund and Aravis Venture. NovImmune has two fully human monoclonal antibodies in clinical development, including its most advanced product candidate, which is in Phase IIa trials for Crohn’s disease. The proceeds from this round will enable NovImmune to bring two more candidates into clinical trials in the next two years.

Medicus Insurance Holdings, Inc. Secures Funding from The Cypress Group and CHL Medical Partners; New Insurance Company To Target Professional Medical-Liability Market

Austin, TX – October 2, 2006

Medicus Insurance Holdings, Inc. announced today that it has entered into a financing arrangement with institutional investors for the issuance of up to $100 million of Series A Preferred Stock. Medicus and its operating subsidiary, Medicus Insurance Company, were formed in order to provide a new source of professional medical-liability insurance coverage to physicians in Texas and other states.

In the first round of funding Medicus Insurance Holdings, Inc. received $15 million, with subsequent rounds to support growth expected over the next three years. Sponsoring investors of Medicus are affiliates of The Cypress Group and CHL Medical Partners. The Medicus management team, led by Howard H. Lamb and Sheldon Davidow, has also made a significant investment in the company.

The Medicus management team has extensive industry experience and local roots in the Texas market. Over the course of his 50-year career in the insurance industry, Medicus CEO Howard Lamb served as CEO of The Doctors Company and held other senior leadership positions in the insurance industry. Medicus President and Chief Operating Officer Sheldon Davidow has over 25 years of insurance industry experience and has worked with Mr. Lamb previously as Executive Vice President of The Doctors Company. Charles W. Bailey, Jr., M.D., J.D., former President of the Texas Medical Association, will serve as the company's Vice President of Medical Relations.

"Medicus offers the medical community a compelling combination of a highly experienced management team supported by a substantial capital base,” said Howard Lamb. “We look forward to becoming the insurer of choice for physicians in Texas and plan to earn their confidence by delivering quality, service, and value in our product offerings.” Speaking on behalf of the investor group, Walter Keenan of The Cypress Group said, “We congratulate Howard and Sheldon for assembling an extraordinary team of industry professionals at Medicus and for becoming a fully licensed and admitted carrier in the state of Texas. We are grateful for the encouraging response to Medicus' startup from doctors and their agents, and look forward to supporting the company's future growth.”

The shares of common stock and Series A Preferred Stock of Medicus Insurance Holdings, Inc. have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful.

About Medicus Insurance Company
Medicus Insurance Holdings, Inc. is a Delaware holding company whose sole subsidiary, Medicus Insurance Company, offers malpractice insurance to physicians, surgeons, and related medical-service providers in the state of Texas. The Medicus leadership team is comprised of insurance and medical leaders dedicated to providing lower-priced malpractice coverage that supports and protects medical practitioners in today's complex healthcare environment.