RLI CORP — Director's Dealing 2008

May 15, 2008

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: RLI CORP (RLI)
CIK: 0000084246
Period of Report: 2008-05-14

Reporting Person: DONDANVILLE JOSEPH E (Senior Vice President/CFO)

Non-Derivative Transactions

Date	Security	Code	Shares	Price	A/D	Holdings After	Ownership
2008-05-14	Common Stock	M	7097	$15.7813	Acquired	68457.015	Direct
2008-05-14	Common Stock	M	13518	$15.9063	Acquired	81975.015	Direct
2008-05-14	Common Stock	F	10566	$50.46	Disposed	71409.015	Direct

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2008-05-14	Option	$15.9063	M	13518	Disposed	2009-05-06	Common Stock (13518)	Direct
2008-05-14	Stock Option	$15.7813	M	7097	Disposed	2010-05-04	Common Stock (7097)	Direct

Holdings (Non-Derivative)

Security	Shares	Ownership
Common Stock	24720.3851	Indirect
Common Stock	8592.3	Indirect
Common Stock	200	Indirect

Holdings (Derivative)

Security	Exercise Price	Expiration	Underlying	Shares	Ownership
Stock Option	$20.05	2011-05-03	Common Stock (22000)	22000	Direct
Stock Option	$29.335	2012-05-02	Common Stock (32000)	32000	Direct
Stock Option	$29.55	2013-05-01	Common Stock (28000)	28000	Direct
Stock Option	$35.08	2014-05-06	Common Stock (28000)	28000	Direct
Stock Option	$44.54	2015-05-05	Common Stock (21000)	21000	Direct
Stock Option	$50	2018-05-01	Common Stock (5000)	5000	Direct
Stock Option	$50.15	2016-05-04	Common Stock (17500)	17500	Direct
Stock Option	$56.09	2017-05-03	Common Stock (18000)	18000	Direct

Footnotes

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

F2: Ownership reflects dividend reinvestment.

F3: 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.