Bad Faith Claim against Island Insurance Company

Bobby N. Harmon, CPCU, ARM

September 1, 2006

VIA fax @ (808) 564-8456

Colbert Matsumoto, Chairman of the Board

John Schapperle, President

Island Insurance Company, Inc.

1022 Bethel St.

Honolulu, HI 96813

RE: Notice of Bad Faith Claim Against Island Insurance Company, Inc., et al.

Dear Mr. Matsumoto and Mr. Schapperle:

As Island Insurance Company has failed to properly respond to my previous Notices of Claims, I am hereby notifying you of this new Notice of Claim for bad faith.

For information related to this claim, I refer you to the following web addresses:

www.the-catbird-seat.net/Claim-Island-9-23-4.htm

www.the-catbird-seat.net/Claim-Island-9-27-4.htm

www.the-catbird-seat.net/Claim-Island-2-4-5.htm

www.the-catbird-seat.net/Claim-Island-3-7-5.htm

www.the-catbird-seat.net/Claims-Branch-Island.htm

www.the-catbird-seat.net/CV05-00030-Hughes-Roy-8-4-5.htm

www.the-catbird-seat.net/CV05-00030-Witness-Matsumoto.htm

www.the-catbird-seat.net/CV05-00030-Witness-Hughes-Roy.htm

www.the-catbird-seat.net/CV05-00030-Witness-Tanoue-Michael.htm

For the failure of your company to act in good faith by not responding in a prompt and proper manner to my legitimate Notices of Claims, I am asking for the sum of Five Hundred Thousand Dollars ($500,000.00) from Colbert Matsumoto, Chairman of the Board; plus the sum of Five Hundred Thousand Dollars ($500,000.00) from John Schapperle, President; plus the sum of Five Hundred Thousand Dollars ($500,000.00) from Linda Gilchrist, former President, plus the sum of Five Hundred Thousand Dollars ($500,000.00) from your attorney, Michael Tanoue. In addition, I am asking for the sum of One Million Dollars ($1,000,000.00) from Island Insurance Company, Inc.

I ask that you immediately acknowledge receipt of this current Notice of Claim, and inform me of the date that you provided notice of this new claim to your current professional liability insurance carrier.

Any failure to respond to this Notice of Claim, will be considered another act of bad faith and will result in further claims against you, your law firm and your current professional liability insurance carrier(s).

Very truly yours,

Bobby N. Harmon, CPCU, ARM

cc: Mark Recktenwald, Director, DCCA (Mark.E.Recktenwald@dcca.hawaii.gov)

J.P. Schmidt, Hawaii Insurance Commissioner (via fax: 808-586-2806)

Marsh & McLennan Companies, Inc., Marsh USA, Inc.

c/o Duane R. Miyashiro, Esq., Carlsmith Ball LLP (drm-1@carlsmith.com)

Karen J. Mathis, President, American Bar Association (www.abanet.org/contact/)

Wayne Parsons, President, Hawaii State Bar Association

Law Offices of Wayne Parsons (via fax: 808-843-0100 and wparsons@hsba.org)

Jeffrey S. Portnoy, Vice-President/President-Elect, Hawaii State Bar Association

Cades Schutte LLP (via fax: 808-540-5040 and jportnoy@hsba.org)

Carol K. Muranaka, Treasurer, Hawaii State Bar Association