RLI CORP — Director's Dealing 2007

May 7, 2007

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: RLI CORP (RLI)
CIK: 0000084246
Period of Report: 2007-05-03

Reporting Person: Denzer Carol Jeanne (VP, CIO RLI Insurance Company)

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2007-05-03	Stock Option	$56.09	A	6500	Acquired	2017-05-03	Common Stock (6500)	Direct

Holdings (Non-Derivative)

Security	Shares	Ownership
Common Stock	808	Direct
Common Stock	13072.9652	Indirect

Holdings (Derivative)

Security	Exercise Price	Expiration	Underlying	Shares	Ownership
Stock Option	$29.335	2012-05-02	Common Stock (160)	160	Direct
Stock Option	$29.55	2013-05-01	Common Stock (280)	280	Direct
Stock Option	$31.15	2013-08-04	Common Stock (100)	100	Direct
Stock Option	$35.08	2014-05-06	Common Stock (800)	800	Direct
Stock Option	$44.54	2015-05-05	Common Stock (3500)	3500	Direct
Stock Option	$50.15	2016-05-04	Common Stock (5000)	5000	Direct

Footnotes

F1: Ownership reflects shares allocated to ESOP participant's account and dividend reinvestment.

F2: Pursuant to option schedule wherein 20% of the aggregate number of shares granted may be exercised commencing one year from grant date and each year thereafter in 20% increments.