RICHFIELD, Ohio National Interstate Corporation expects to report flat profits for the fourth quarter of 2007, but record-setting earnings for the full year.

Richfield-based National Interstate anticipates fourth-quarter 2007 net income in the range of 54 to 60 cents per diluted share, compared to actual earnings of 59 cents per diluted share for the fourth quarter of 2006.

For all of 2007, National Interstate is forecasting earnings of $2.22 to $2.28 per diluted share, compared to full-year 2006 earnings of $1.85 per diluted share, or a gain of more than 20 percent.

The parent company of National Interstate Insurance announced the preliminary results late last month.

The flat '07 fourth quarter will come despite a more than 15 percent increase in gross premiums written during the quarter. For the full year, gross premiums totaled $346 million, a 13.3 percent increase over premiums of $305.5 million for the 2006 full year.

National Interstate reiterated that it has minimum exposure to the current turmoil roiling financial and investment markets. For example, National Interstate says its investment portfolio is conservative, diversified and high quality.

Specifically, the company does not have any direct exposure in its mortgage backed/collateralized mortgage obligations related to the so-called subprime lending sector.

Additionally, 94 percent of its municipal bond portfolio is rated A- or better, and all of its investments are current with dividend and interest payments.

And while the market turmoil has resulted in value declines in its portfolio, particularly in the credit- and real estate-related holdings, the company doesn't believe it will experience "any material true economic losses from these investments."

The company will release final '07 fourth quarter and year-end results before the market opens Feb. 19.