Pursuant to the authority granted it under the Mercury General Corporation Senior Executive Incentive Bonus Plan (the "Senior Plan") to establish periodic bonus programs based on specified performance objectives, on March 12, 2009, the Compensation Committee of Mercury General Corporation (the "Company") established the performance criteria set forth in the table below that will be used to determine bonuses payable under the Senior Plan for 2009. Specifically, the Compensation Committee determined that the bonuses (if any) payable to the covered executives under the Senior Plan will be based on the Company's underwriting income.

                                       Target Bonus                          Maximum Bonus
Name and Position                    under Senior Plan                     under Senior Plan
George Joseph         0.6% of the Company's underwriting income (1)       $         5,000,000
Gabriel Tirador       0.5% of the Company's underwriting income (1)       $         5,000,000

(1) Underwriting Income is calculated as Earned Premiums less Losses and Loss Adjustment Expenses, Policy Acquisition Costs, and Other Operating Expenses derived from the Company's consolidated financial statements prepared in accordance with United States generally accepted accounting principles.