Item 8.01 Other Events.
On May 19, 2009, First Acceptance Corporation (the "Company") entered into an agreement with its insurance carriers regarding coverage for the costs and expenses incurred by the Company relating to the settlement of litigation formerly pending against the Company in the States of Georgia and Alabama. The Company entered into settlement agreements with respect to the Georgia and Alabama litigation during September 2008 and December 2008, respectively. Pursuant to the terms of the agreement with its insurance carriers, in addition to defense costs that have been or will be paid by the insurance carriers, the Company will receive $2.95 million to partially offset the costs of the settlement of the litigation. The Company had not accrued any amounts at March 31, 2009 for recoveries from its insurance carriers, and the amount received from such insurance carriers will be recognized in the Company's operating results for the quarter ending June 30, 2009.

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