SCHEDULE 14A

                            SCHEDULE 14A INFORMATION
                Proxy Statement Pursuant to Section 14(a) of the
                        Securities Exchange Act of 1934
                               (Amendment No. __)

Filed by Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

      [X]   Preliminary Proxy Statement
      [ ]   Confidential, for Use of the Commission Only (as permitted by Rule
            14a-6(e)(2))
      [ ]   Definitive Proxy Statement
      [ ]   Definitive Additional Materials
      [ ]   Soliciting Material Pursuant to section 240.14a-11(c) or
            section 240.14a-12


                       Universal Insurance Holdings, Inc.
               __________________________________________________
                (Name of Registrant as Specified In Its Charter)

          _____________________________________________________________
      (Name of Person(s) Filing Proxy Statement, if other than Registrant)

Payment of Filing Fee (Check the appropriate box):

      [X]   No fee required.

      [ ]   Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
            0-11:

            1)    Title of each class of securities to which transaction
                  applies:

            2)    Aggregate number of securities to which transaction applies:

            3)    Per  unit  price  or  other  underlying  value  of transaction
                  computed  pursuant  to Exchange Act Rule 0-11 (set  forth  the
                  amount on which the filing  is calculated and state how it was
                  determined):

            4)    Proposed maximum aggregate value of transaction:

            5)    Total fee paid:

      [ ]   Fee paid previously with preliminary materials.



      [ ]    Check box if any part of the fee is  offset as provided by Exchange
             Act  Rule  0-11(a)(2)  and  identify  the  filing   for  which  the
             offsetting  fee was paid previously.  Identify the previous  filing
             by registration  statement  number, or the Form or Schedule and the
             date of its filing.

             1)    Amount Previously Paid:

             2)    Form, Schedule or Registration Statement Number:

             3)    Filing Party:

             4)    Date Filed:



                                 April [    ], 2007


Dear Shareholder:

     On behalf of the Board of Directors, I invite you to attend the 2007 Annual
Meeting of Shareholders ("Annual Meeting") of Universal Insurance Holdings, Inc.
("Company").  The Annual  Meeting  will be held at 9:00 a.m.,  Eastern  Standard
Time, on Friday, May 18, 2007 at the executive offices of the Company, 1110 West
Commercial Boulevard, Suite 100, Fort Lauderdale, Florida 33309.

     The  shareholders  will be asked (i) to elect six  directors,  each to hold
office until the 2008 annual meeting or until their successors have been elected
and  qualified;  (ii) to approve an amendment to the  Company's  Certificate  of
Incorporation,  as amended and  restated,  to increase the number of  authorized
shares of common  stock of the  Company  from  50,000,000  shares to  55,000,000
shares;  (iii) to approve the formulas used to calculate  performance bonuses in
each of the amended  employment  agreements of the Chief  Executive  Officer and
Chief  Operating  Officer of the Company;  and (iv) to ratify the appointment of
Blackman Kallick Bartelstein LLP as the independent registered public accounting
firm of the  Company  for the  year  ending  December  31,  2007.  The  Board of
Directors has  unanimously  approved these  proposals and we urge you to vote in
favor of these  proposals and in accordance with the Board's  recommendation  on
such other matters as may be submitted to you for a vote at the meeting.

     Your vote is very  important,  regardless  of the number of shares you own.
Please  sign and  return  each  proxy  card  that you  receive  in the  enclosed
postage-paid  envelope,  which is provided for your  convenience.  The return of
your proxy card will not  prevent you from voting in person but will assure that
your vote is counted if you are  unable to attend  the Annual  Meeting.  We look
forward to seeing you on May 18, 2007.


                                        Sincerely,


                                        DRAFT
                                        -----
                                        Bradley I. Meier, President





                   1110 West Commercial Boulevard, Suite 100,
                 Fort Lauderdale, Florida 33309, (954) 958-1200


                       UNIVERSAL INSURANCE HOLDINGS, INC.
                    1110 WEST COMMERCIAL BOULEVARD, SUITE 100
                         FORT LAUDERDALE, FLORIDA 33309

                                     NOTICE
                         ANNUAL MEETING OF SHAREHOLDERS
                             TO BE HELD MAY 18, 2007

     NOTICE  IS  HEREBY  GIVEN  that the 2007  Annual  Meeting  of  Shareholders
("Annual Meeting") of Universal Insurance Holdings, Inc., a Delaware corporation
("Company"),  will be held at 9:00 a.m.,  Eastern Standard Time, on Friday,  May
18,  2007,  at the  executive  offices  of the  Company,  1110  West  Commercial
Boulevard,  Suite  100,  Fort  Lauderdale,  Florida  33309,  for  the  following
purposes:

     1.   To elect six  directors,  each to hold  office  until the 2008  annual
          meeting or until their successors have been elected and qualified;

     2.   To approve an amendment to the Company's Certificate of Incorporation,
          as amended and restated,  to increase the number of authorized  shares
          of common stock of the Company from  50,000,000  shares to  55,000,000
          shares;

     3.   To approve the formulas used to calculate  performance bonuses in each
          of the amended  employment  agreements of the Chief Executive  Officer
          and the Chief Operating Officer of the Company;

     4.   To ratify the appointment of Blackman  Kallick  Bartelstein LLP as the
          independent  registered  public accounting firm of the Company for the
          year ending December 31, 2007; and

     5.   To transact any other  business as may properly come before the Annual
          Meeting or any adjournment thereof.

     The Board of Directors has fixed the close of business on April 16, 2007 as
the record date for the determination of shareholders entitled to notice of, and
to vote at, the Annual Meeting and at any adjournment  thereof.  A complete list
of  shareholders  of record of the Company on the record date will be  available
for  examination  by any  shareholder,  for any  purpose  germane  to the Annual
Meeting,  during ordinary  business  hours,  for the ten-day period prior to the
Annual Meeting,  at the executive  offices of the Company,  1110 West Commercial
Boulevard, Suite 100, Fort Lauderdale, Florida 33309.

     It is  important  that your shares be  represented  at the Annual  Meeting.
Whether or not you expect to be present,  please fill in, date,  sign and return
the enclosed proxy form in the accompanying addressed, postage-prepaid envelope.
If you attend the meeting, you may revoke your proxy and vote in person.

                                       2



     In the event that there are not sufficient  votes to approve any one of the
foregoing proposals at the time of the Annual Meeting, the Annual Meeting may be
adjourned to permit further solicitation of proxies by the Company.

                                        BY ORDER OF THE BOARD OF DIRECTORS

                                        DRAFT
                                        -----
                                        Norman M. Meier, Secretary

Fort Lauderdale, Florida
April [      ], 2007

     WHETHER  OR NOT YOU PLAN TO BE  PRESENT  IN PERSON AT THE  ANNUAL  MEETING,
PLEASE  COMPLETE,  SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT AS PROMPTLY AS
POSSIBLE IN THE ACCOMPANYING  POSTAGE-PREPAID ENVELOPE.  SHAREHOLDERS WHO ATTEND
THE MEETING MAY REVOKE THEIR PROXIES AT THE MEETING AND VOTE IN PERSON.

                                       3



                       UNIVERSAL INSURANCE HOLDINGS, INC.
                    1110 WEST COMMERCIAL BOULEVARD, SUITE 100
                         FORT LAUDERDALE, FLORIDA 33309


                                 PROXY STATEMENT

     This Proxy  Statement is furnished in connection  with the  solicitation by
the Board of  Directors  ("Board")  of  Universal  Insurance  Holdings,  Inc., a
Delaware corporation  ("Company"),  of proxies to be voted at the Annual Meeting
of Shareholders of the Company ("Annual  Meeting"),  to be held at the executive
offices  of the  Company,  1110  West  Commercial  Boulevard,  Suite  100,  Fort
Lauderdale,  Florida  33309,  on  Friday,  May 18,  2007 at 9:00  a.m.,  Eastern
Standard Time, and at any and all postponements or adjournments thereof, for the
purposes set forth in the accompanying Notice of Annual Meeting.

     A copy of the  Annual  Report of the  Company  for its  fiscal  year  ended
December 31, 2006 is included.  This Proxy Statement,  Notice of Annual Meeting,
accompanying  proxy card,  and Annual Report are first  expected to be mailed to
shareholders on or about April [  ], 2007.

              INFORMATION RELATING TO VOTING AT THE ANNUAL MEETING

     The close of  business on April 16, 2007 has been fixed by the Board as the
record date ("Record Date") for determination of shareholders entitled to notice
of, and to vote at, the Annual Meeting.  Therefore,  only shareholders of record
as of the close of business on April 16, 2007 are  entitled to notice of, and to
vote at, the Annual Meeting or any  postponements or adjournments  thereof.  The
securities  to be voted at the  Annual  Meeting  consist of (i) shares of Common
Stock of the  Company,  $0.01 par value per share  ("Common  Stock"),  with each
share  entitling its record owner to one vote, (ii) shares of Series M Preferred
Stock of the Company,  $0.01 par value per share  ("Series M Preferred  Stock"),
with each  share  entitling  its  record  owner to one vote and (iii)  shares of
Series A Preferred  Stock of the Company,  $0.01 par value per share  ("Series A
Preferred  Stock"),  with each share entitling its record owner to one vote. The
holders of Series M Preferred Stock, voting separately as a series, are entitled
to elect two directors.  The holders of Common Stock,  Series M Preferred  Stock
and Series A Preferred  Stock,  voting  together as one class,  are  entitled to
elect the remaining directors.

     If the accompanying proxy card is properly signed,  returned to the Company
in  time  to be  voted  at the  Annual  Meeting,  and not  revoked,  the  shares
represented  by such  card  will be voted in  accordance  with the  instructions
contained on such card.  Unless  contrary  instructions  are given,  the persons
designated  as proxy  holders in the proxy card will vote FOR  Proposals 1, 2, 3
and 4. If any other matters properly come before the Annual Meeting, the persons
named as proxy  holders will vote upon such matters as  determined by a majority
of the Board.

     Each  shareholder may revoke a previously  granted proxy at any time before
it is  exercised  by  filing  with  the  Secretary  of the  Company  a  revoking
instrument  or a duly  executed  proxy  bearing a later date.  The powers of the
proxy  holders will be suspended if the person  executing  the proxy attends the
Annual Meeting in person and so requests.  Attendance at the Annual Meeting will
not, in itself, constitute revocation of a previously granted proxy.

                                       1



     The table below sets forth the number and classes of Company stock entitled
to vote at the Annual Meeting.


Class of Voting Stock               Number of Record Holders            Number of Shares              Amount of Votes
---------------------               ------------------------            ----------------              ---------------
                                     as of the Record Date                 Outstanding              Entitled to be Cast
                                     ---------------------                 -----------              -------------------
                                                                       as of the Record Date        as of the Record Date
                                                                       ---------------------        ---------------------
                                                                                                 
Common Stock                                   45                           38,057,103                    38,057,103
Series M Preferred Stock                        4                             88,690                        88,690
Series A Preferred Stock                        3                             44,950                        44,950



     The  Company  had no other class of voting  securities  outstanding  on the
Record Date.

     The  presence,  in person or by proxy,  of at least a majority of the total
number of outstanding shares of the Series M Preferred Stock entitled to vote at
the Annual  Meeting  for those  matters  where a  separate  vote of the Series M
Preferred  Stock is required,  and of at least a majority of the total number of
outstanding  shares of the Common Stock,  Series M Preferred  Stock and Series A
Preferred  Stock  entitled to vote at the Annual Meeting for those matters where
the Common Stock,  Series M Preferred Stock and Series A Preferred Stock, voting
together as a class,  is required,  is  necessary to  constitute a quorum at the
Annual Meeting.  If a quorum is not present at the Annual Meeting, a majority of
the shares so  represented  may vote to adjourn the Annual  Meeting from time to
time without further notice.  If a quorum is present,  the affirmative vote of a
majority  of the votes  actually  cast at the  meeting,  whether in person or by
proxy,  is necessary to elect the  nominees for  directors.  With respect to the
amendment of the Company's  Certificate of Incorporation,  the vote required for
approval shall be the affirmative  vote of the holders of at least a majority of
the  issued and  outstanding  shares of capital  stock  entitled  to vote at the
Annual Meeting. There is no cumulative voting in the election of directors. With
respect to the approval of the formulas used to calculate  performance  bonuses,
or  any  other  matter  properly  brought  before  the  Annual  Meeting  or  any
adjournment of the Annual  Meeting,  the vote required for approval shall be the
affirmative  vote of a majority of the total number of votes that those  present
at the Annual Meeting, in person or by proxy, are entitled to cast.

     Under Delaware law,  shares  represented  at the Annual Meeting  (either by
properly  executed  proxies or in person)  that reflect  abstentions  or "broker
non-votes" (i.e., shares held by a broker or nominee that are represented at the
Annual  Meeting,  but with  respect  to which  such  broker  or  nominee  is not
empowered to vote on a particular  proposal)  will be counted as shares that are
present and  entitled  to vote for  purposes of  determining  the  presence of a
quorum.  Abstentions  as to any  proposal  will  have the same  effect  as votes
against the proposal.  With respect to Proposals 1 and 4, broker  non-votes will
be treated as unvoted for  purposes of  determining  approval of such  proposals
(and therefore  will reduce the absolute  number - although not the percentage -
of votes  needed for  approval)  and will not be counted as votes for or against
the proposals. With respect to Proposals 2 and 3, however, broker non-votes will
have the same effect as votes against the proposal.

     A shareholder may revoke his or her proxy at any time prior to its exercise
by (i) filing with Norman M. Meier,  Secretary,  Universal  Insurance  Holdings,
Inc., 1110 West Commercial Boulevard, Suite 100, Fort Lauderdale, Florida 33309,

                                       2



written notice  thereof,  (ii)  submitting a duly executed proxy bearing a later
date, or (iii)  appearing at the Annual Meeting and giving the Secretary  notice
of his or her  intention  to  vote  in  person.  Unless  previously  revoked  or
otherwise instructed thereon, proxies will be voted at the Annual Meeting on the
proposals as described above.

     The Company will bear the cost of soliciting  proxies in the enclosed form.
Officers and regular  employees of the Company may solicit  proxies by a further
mailing or personal  conversations or via telephone or facsimile,  provided that
they do not receive  compensation  for doing so. The Company will, upon request,
reimburse brokerage firms and others for their reasonable expenses in forwarding
solicitation material to the beneficial owners of stock.

                                       3



                              ELECTION OF DIRECTORS
                                  (PROPOSAL 1)

     The Board has the ultimate  authority  for the  management of the Company's
business,   objectives  and  operations.  It  selects  the  Company's  executive
officers, delegates responsibilities for the conduct of the Company's day-to-day
operations to those officers, and monitors the performance of the officers.

     Meetings of the Board are held regularly each quarter and as required.  The
Board held five meetings  during 2006.  During 2006,  each director  attended 75
percent or more of the  aggregate  number of Board  meetings and meetings of the
Board committees on which he served.

     The Company  encourages  its Board members to attend the  Company's  Annual
Meeting of Shareholders.

     The following table sets forth the total  compensation paid to non-employee
directors during the fiscal year ended December 31, 2006.

--------------------------------------------------------------------------------
                             DIRECTOR COMPENSATION
--------------------------------------------------------------------------------
                        Fees
                      Earned or
                      Paid In          Stock
Name                    Cash           Awards           Total
--------------------------------------------------------------------------------
Joel Wilentz          $45,000          $38,000          $83,000
--------------------------------------------------------------------------------
Norman Meier          $45,000          $38,000          $83,000
--------------------------------------------------------------------------------
Reed Slogoff          $45,000          $38,000          $83,000
--------------------------------------------------------------------------------

     For 2007,  non-employee  directors  will  receive  annual  compensation  of
$80,000,  paid  quarterly,  for  serving on the Board and the  reimbursement  of
reasonable  expenses  incurred  in  attending  meetings.  Officers  are  elected
annually by the Board and serve at the discretion of the Board.  The Company has
entered  into  indemnification   agreements  with  its  executive  officers  and
directors   pursuant  to  which  the  Company  has  agreed  to  indemnify   such
individuals,  to the fullest  extent  permitted  by law, for claims made against
them in connection with their positions as officers,  directors or agents of the
Company.

     The Board has nominated Bradley I. Meier,  Norman M. Meier, Sean P. Downes,
Ozzie A.  Schindler,  Reed J. Slogoff and Joel M. Wilentz for  reelection to the
Board  to serve as  directors  until  the 2008  annual  meeting  or until  their
successors  are duly elected and  qualified.  The nominees have  consented to be
named and have  indicated  their  intent to serve if  elected.  The Board has no
reason  to  believe  that the  nominees  will be  unavailable  or that any other
vacancy on the Board will occur.  If any  nominee  becomes  unavailable  for any
reason,  or if any other  vacancy in the class of directors to be elected at the
Annual Meeting should occur before the election,  the shares  represented by the
proxy will be voted for the person,  if any, who is  designated  by the Board to
replace the nominee or to fill such other vacancy on the Board.

                                       4



     The holders of Series M Preferred Stock, voting separately as a series, are
entitled to elect directors to fill the seats currently held by Bradley I. Meier
and Norman M. Meier,  both of whom the Board  recommends  for  reelection;  such
directors  shall be  elected by a majority  of votes in the  affirmative  of the
Series M  Preferred  Stock  shares  cast at the Annual  Meeting.  The holders of
Common Stock,  the holders of Series M Preferred Stock and the holders of Series
A Preferred Stock, voting together as one class, are entitled to elect directors
to fill the seats currently held by Sean P. Downes, Ozzie A. Schindler,  Reed J.
Slogoff and Joel M. Wilentz,  all of whom the Board  recommends for  reelection;
such directors shall be elected by a majority of votes in the affirmative of the
Common  Stock  shares,  Series M Preferred  Stock  shares and Series A Preferred
Stock  shares,  voting  together  as a class,  cast at the  Annual  Meeting.  If
elected,  all nominees  are  expected to serve until the 2008 annual  meeting or
until their successors are duly elected and qualified.

     THE BOARD  UNANIMOUSLY  RECOMMENDS  THAT THE  NOMINEES  DESCRIBED  ABOVE BE
ELECTED AS  DIRECTORS  TO SERVE  UNTIL THE 2008  ANNUAL  MEETING OR UNTIL  THEIR
SUCCESSORS ARE DULY ELECTED AND QUALIFIED.

                                       5



                             INFORMATION CONCERNING
                  THE BOARD OF DIRECTORS AND EXECUTIVE OFFICERS

     The current directors and executive officers of the Company are as follows:


        Name              Age                   Position                         First Year as
        -----             ---                   --------                            Director
                                                                                    --------
                                                                                 (Term Expires)
                                                                              
Bradley I. Meier          39        President, Chief Executive Officer and              1990
(Director Nominee)                  Director                                           (2007)

Norman M. Meier           68        Director, Secretary                                 1992
(Director Nominee)                                                                     (2007)

Ozzie A. Schindler        38        Director                                            2007
(Director Nominee)                                                                     (2007)

Reed J. Slogoff           38        Director                                            1997
(Director Nominee)                                                                     (2007)

Joel M. Wilentz, M.D.     73        Director                                            1997
(Director Nominee)                                                                     (2007)

Sean P. Downes            37        Chief Operating Officer, Senior Vice                2005
(Director Nominee)                  President and Director                             (2007)

James M. Lynch            52        Executive Vice President and Chief
                                    Financial Officer


BIOGRAPHICAL INFORMATION

     Biographical  information regarding the directors and executive officers of
the Company is as follows:

     Bradley I. Meier has been President, Chief Executive Officer and a Director
of the Company since its inception in November  1990. He has served as President
of Universal Property and Casualty  Insurance Company ("UPCIC"),  a wholly owned
subsidiary of the Company, since its formation in April 1997. In 1990, Mr. Meier
graduated from the Wharton School of Business with a B.S. in Economics.

     Norman M. Meier has been a Director  of the Company  since July 1992.  From
December 1986 until  November 1999,  Mr. Meier was  President,  Chief  Executive
Officer  and a  Director  of  Columbia  Laboratories,  Inc.,  a  publicly-traded
corporation in the  pharmaceuticals  business.  From 1971 to 1977, Mr. Meier was
Vice President of Sales and Marketing for Key  Pharmaceuticals.  From 1977 until
1986, Mr. Meier served as a consultant to Key Pharmaceuticals.

                                       6



     Ozzie A.  Schindler  has been a Director of the Company since January 2007.
Mr.  Schindler  is a  partner  with  the  law  firm  of  Greenberg  Traurig  and
specializes in international tax, trusts and succession and planning.  He has an
LL.M. in Taxation  from New York  University  School of Law and  graduated  with
honors  from the  University  of  Florida  School  of Law.  Mr.  Schindler  also
graduated  with high  honors from the  University  of Florida  Fisher  School of
Accounting. He is admitted to both the Florida and New York bars.

     Reed J.  Slogoff has been a Director of the Company  since March 1997.  Mr.
Slogoff is currently a principal with Pearl  Properties  Commercial  Management,
LLC,  a  commercial  real  estate   investment  and  management  firm  based  in
Philadelphia,   Pennsylvania.   Mr.   Slogoff   was   formerly   with   Entercom
Communications  Corp.,  a publicly  traded  radio  broadcasting  company and was
previously  a member of the  corporate  and real estate group of the law firm of
Dilworth,  Paxson,  LLP.  Mr.  Slogoff  received  a B.A.  with  Honors  from the
University of  Pennsylvania  in 1990,  and a J.D.  from the  University of Miami
School of Law in 1993.

     Joel M. Wilentz,  M.D. has been a Director of the Company since March 1997.
Dr. Wilentz is one of the founding members of Dermatology Associates in Florida,
founded  in 1970.  He is a  member  of the  boards  of the  Neurological  Injury
Compensation  Association  for  Florida,  the  Broward  County  Florida  Medical
Association,  and the American Arm of the Israeli  Emergency Medical Service for
the southeastern United States, of which he is also President.  Dr. Wilentz is a
past member of the Board of Overseers of the Nova Southeastern University School
of Pharmacy.

     Sean P. Downes has been Senior Vice President,  Chief Operating Officer and
a Director of the Company since  January 2005. He also has been Chief  Operating
Officer and a Director of UPCIC since July 2003. Mr. Downes was Chief  Operating
Officer of Universal  Adjusting  Corporation from July 1999 to July 2003. During
that time, Mr. Downes created the Company's claims operation. Before joining the
Company in July 1999, Mr. Downes was Vice President of Downes and Associates,  a
multi-line insurance adjustment corporation.

     James M.  Lynch has been  Executive  Vice  President  and  Chief  Financial
Officer of the Company since August 1998.  Before  joining the Company in August
1998, Mr. Lynch was Chief Financial Officer of Florida Administrators,  Inc., an
organization  specializing in property and casualty insurance.  Prior to working
at Florida  Administrators,  Inc.,  Mr.  Lynch held the  position of Senior Vice
President  of  Finance  and  Comptroller  of  Trust  Group,   Inc.,  which  also
specialized  in property  and casualty  insurance.  Before his position at Trust
Group,  Mr. Lynch was a Manager with the accounting and auditing firm of Coopers
& Lybrand, which later became PricewaterhouseCoopers LLC.

     Norman M. Meier and  Bradley  I.  Meier are  father and son,  respectively.
There are no other family  relationships  among the Company's executive officers
and directors.

     All directors hold office until the next annual meeting of  shareholders or
the election and qualification of their successors.  Currently, the Company does
not have a  procedure  by  which  shareholders  may  recommend  nominees  to the
Company's  Board of  Directors.  Officers  are elected  annually by the Board of
Directors and serve at the discretion of the Board.

                                       7



COMMITTEES AND CORPORATE GOVERNANCE

     AUDIT COMMITTEE

     The Company has a separately designated Audit Committee,  whose members are
Ozzie  A.  Schindler,  Reed J.  Slogoff  and Joel M.  Wilentz,  each of whom was
determined  by the Board to be  independent  under the  applicable  rules of the
Securities  and  Exchange  Commission  ("SEC") and the National  Association  of
Securities  Dealers  ("NASD").  The Company's  Board of Directors has determined
that Ozzie A. Schindler is an "audit committee  financial  expert" as defined by
Item 407(d)(5) of Regulation S-K promulgated by the SEC.

     The Audit Committee  recommends the firm to be appointed as the independent
registered  public  accounting  firm  of the  Company  to  audit  the  Company's
financial  statements and to perform services  related to the audit,  review the
scope and results of the audit with the independent registered public accounting
firm,  review with management and the independent  registered  public accounting
firm the Company's  year-end  operating results and consider the adequacy of the
internal accounting procedures.

     The Audit  Committee met  separately  once during 2006, and the full Board,
including the members of the Audit Committee,  met several times during the year
to discuss the financial position of the Company,  provide  recommendations  and
guidance to management and evaluate  strategies and financial  opportunities and
initiatives.

     The Audit  Committee  operates under a written  charter that was adopted by
the Board of Directors on January 9, 2007. A copy of the Audit Committee Charter
is attached to this Proxy Statement as Appendix A. The Audit  Committee  Charter
will be reviewed annually for changes, as appropriate.

     AUDIT COMMITTEE REPORT

     The  following  is the report of the Audit  Committee  with  respect to the
Company's  audited  financial  statements for the fiscal year ended December 31,
2006,  which  include the balance  sheet of the Company as of December 31, 2006,
and the related  statements of operations,  changes in shareholders'  equity and
cash flows for the years in the period ended  December 31, 2006 and 2005 and the
notes thereto.  The information  contained in this report shall not be deemed to
be  "soliciting  material"  or to be  "filed"  with  the  SEC,  nor  shall  such
information  be  incorporated  by  reference  into any future  filing  under the
Securities Act of 1933, as amended,  or the Securities  Exchange Act of 1934, as
amended,  ("Exchange  Act")  except to the extent that the Company  specifically
incorporates it by reference in such filing.

     Composition
     -----------

     The Audit  Committee  of the Board of  Directors  is  composed of the three
directors named below. Each member of the Audit Committee meets the independence
and financial experience  requirements under the applicable rules of the SEC and
the NASD.

                                       8



     Review With Management
     ----------------------

     The Audit  Committee  has  reviewed and  discussed  the  Company's  audited
financial statements with management.

     Review and Discussions With Independent Registered Public Accounting Firm
     -------------------------------------------------------------------------

     The Audit Committee has discussed with Blackman  Kallick  Bartelstein  LLP,
the  Company's  independent  registered  public  accounting  firm for 2006,  the
matters  required to be discussed in accordance with the standards of the Public
Company  Accounting  Oversight Board which include,  among other items,  matters
related to the conduct of the audit of the Company's financial statements.

     The Audit  Committee has received  written  disclosures and the letter from
Blackman  Kallick  Bartelstein  LLP  required by  Independence  Standards  Board
Standard No. 1 (which relates to the accountant's  independence from the Company
and its related  entities) and has discussed with Blackman  Kallick  Bartelstein
LLP its independence from the Company.

     Conclusion
     ----------

     Based on the review and discussions  referred to above, the Audit Committee
recommended  to the Board that the  Company's  audited  financial  statements be
included in the Company's Annual Report on Form 10-KSB for the fiscal year ended
December 31, 2006.


                                        SUBMITTED BY THE AUDIT COMMITTEE OF
                                        THE BOARD OF DIRECTORS

                                        Ozzie A. Schindler
                                        Reed J. Slogoff
                                        Joel M. Wilentz


     COMPENSATION COMMITTEE

     The Compensation Committee consists of Reed J. Slogoff and Joel M. Wilentz,
each of whom was determined by the Board to be independent  under the applicable
rules of the SEC and the NASD.  Among its  duties,  the  Compensation  Committee
assists the Board in  discharging  its  responsibilities  relating to  corporate
goals and objectives  relevant to the  compensation  of the Company's  executive
officers,  evaluating the  performance  of executive  officers in light of those
goals and objectives and determining compensation based on such evaluation.  The
Compensation  Committee operates under a written charter that was adopted by the
Board on January 9, 2007. The  Compensation  Committee  Charter will be reviewed
annually for changes, as appropriate.

                                       9



     DIRECTOR NOMINATIONS

     A director can be  nominated by a member of the Board.  The Company has not
established  a Nominating  Committee.  Given the size of the Company,  the Board
believes that this is appropriate.

     CODE OF BUSINESS CONDUCT AND ETHICS

     The  Company  adopted a Code of  Business  Conduct and Ethics on January 9,
2007 that is applicable to all directors, officers and employees of the Company.
The code is publicly available at the Company's headquarters in Fort Lauderdale,
Florida.  Upon  completion of the build-out of the Company's  website,  the code
will be posted  there.  A copy of the  Company's  Code of  Business  Conduct and
Ethics  may be  obtained  free of charge by written  request to James M.  Lynch,
Universal Insurance Holdings,  Inc., 1110 West Commercial Boulevard,  Suite 100,
Fort Lauderdale, Florida 33309.

     SHAREHOLDER COMMUNICATIONS

     The Company has not  established  a set  process for  shareholders  to send
communications to the Board.  Given the size of the Company,  the Board believes
that this is appropriate.


CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

     Downes and Associates, a, multi-line insurance adjustment corporation based
in Deerfield  Beach,  Florida  performs certain claims adjusting work for UPCIC.
Downes and  Associates is owned by Dennis  Downes,  who is the father of Sean P.
Downes, COO and Senior Vice President of the Company.  During 2006 and 2005, the
Company expensed claims adjusting fees of $829,208 and $1,075,188, respectively,
to Downes and Associates.

     In September 2006, the Company  acquired  Sterling Premium Finance Company,
Inc.  ("Sterling")  for the purchase  price of $50,000 from the Company's  Chief
Executive Officer and Chief Financial Officer, who owned Sterling.  The purchase
price was equal to Sterling's book value at the time of acquisition.

     Transactions  between the Company and its  affiliates  are on terms no less
favorable  to the Company  than can be obtained  from third  parties on an arm's
length basis. Transactions between the Company and any of its executive officers
or directors require the approval of a majority of disinterested directors.


                             EXECUTIVE COMPENSATION

     The following  table sets forth the  compensation  paid to or earned by the
Company's President and Chief Executive Officer and the Company's two other most
highly  compensated  executive  officers  (collectively,  the  "Named  Executive
Officers") during each of the Company's last two fiscal years.

                                       10




---------------------------------------------------------------------------------------------
                           SUMMARY COMPENSATION TABLE
---------------------------------------------------------------------------------------------
                                                                Non-Equity
Name and                                               Stock    Incentive Plan
Principal Position   Year     Salary      Bonus       Awards    Compensation       Total
---------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------
                                                                
Bradley I. Meier,
President & CEO      2006     $830,324    $     -    $     -     $1,075,310(1)    $1,905,634
---------------------------------------------------------------------------------------------
                     2005     $527,365    $     -    $21,500       $191,556         $740,421
---------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------
James M. Lynch,
EVP & CFO            2006     $251,250    $90,500    $42,582     $        -         $383,832
---------------------------------------------------------------------------------------------
                     2005     $279,525     $3,846     $3,000     $        -         $286,371
---------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------
Sean P. Downes,
SVP & COO            2006     $537,678    $     -   $418,462       $843,982(2)    $1,800,122
---------------------------------------------------------------------------------------------
                     2005     $366,923    $     -    $35,000       $181,167         $583,090
---------------------------------------------------------------------------------------------



(1) As of March 30, 2007, $591,811 of which had not been paid and is subject to
shareholder approval under Proposal 3.

(2) As of March 30, 2007, $443,859 of which had not yet been paid and is subject
to shareholder approval under Proposal 3.

EMPLOYMENT AGREEMENTS

     The  Company  has  entered  into  employment  agreements  with  two  of its
executive officers, Bradley I. Meier and Sean P. Downes.

     The Company's employment agreement with Mr. Meier is dated as of August 11,
1999. The Company and Mr. Meier have amended the employment agreement,  with the
most recent  amendment  dated March 21, 2007 (the  employment  agreement and the
amendments are  collectively  referred to as the "Meier  Agreement").  Under the
terms of the Meier  Agreement,  Mr. Meier will serve as the Company's  President
and Chief  Executive  Officer.  Mr. Meier  received a base salary of $830,324 in
2006,  and he is entitled to a twenty percent (20%) increase in base salary each
year. Additionally, pursuant to the Meier Agreement, Mr. Meier is entitled to an
annual bonus equal to three percent (3%) of the pre-tax income of the Company up
to $5 million,  and four  percent  (4%) of the pre-tax  income of the Company in
excess of $5 million; provided,  however, that any such bonus is contingent upon
the Company's shareholders approving such bonus formula, which is the subject of
Proposal 3 at the Annual  Meeting.  Should the  Company's  shareholders  fail to
approve the  formula,  Mr. Meier  forfeits his right to the bonus.  Mr. Meier is
also  eligible  for other  benefits  customarily  provided by the Company to its
executive   employees,   and  the  Meier  Agreement   contains   noncompete  and
nondisclosure  provisions.  In addition,  in the event of a Change in Control of
the Company (as defined in the Meier Agreement), the Company shall pay Mr. Meier
an amount equal to 48 months base salary, plus two times any bonus paid for the

                                       11



preceding fiscal year. Further, in the event of a Change in Control, all options
held by Mr. Meier vest and become  immediately  exercisable.  Also, in the event
that the Company terminates the Meier Agreement, the Company shall pay Mr. Meier
48 months total compensation.  The Meier Agreement expires on December 31, 2008;
however, the agreement is automatically extended each year thereafter unless the
Company  or Mr.  Meier  provides  written  notice  that the  agreement  is being
terminated 60 days in advance of the anniversary date of the Meier Agreement.

     The Company's  employment  agreement with Mr. Downes is dated as of January
1, 2005 and provides that Mr. Downes will serve as Chief  Operating  Officer and
Senior Vice  President of the Company.  The Company and Mr.  Downes have amended
the employment  agreement,  with the most recent  amendment dated March 21, 2007
(the employment agreement and the amendments are collectively referred to as the
"Downes Agreement").  Mr. Downes received a base salary of $527,678 in 2006, and
he is  entitled  to a twenty  percent  (20%)  increase in base salary each year.
Additionally,  pursuant to the Downes  Agreement,  Mr.  Downes is entitled to an
annual bonus equal to three percent (3%) of the pre-tax  profits of the Company;
provided,  however,  that  any  such  bonus is  contingent  upon  the  Company's
shareholders approving such bonus formula, which is the subject of Proposal 3 at
the  Annual  Meeting.  Should the  Company's  shareholders  fail to approve  the
formula, Mr. Downes forfeits his right to the bonus. Under the Downes Agreement,
the Company may grant Mr.  Downes  options or warrants to purchase the Company's
Common  Stock.  Mr.  Downes  is also  eligible  for other  benefits  customarily
provided  by the Company to its  executive  employees  and the Downes  Agreement
contains noncompete and nondisclosure provisions. In addition, in the event of a
Change in Control of the  Company  (as  defined  in the Downes  Agreement),  the
Company shall pay Mr. Downes an amount equal to 12 months base salary,  plus the
annual  bonus paid for the  preceding  fiscal year.  Further,  in the event of a
Change in Control,  all options held by Mr.  Downes vest and become  immediately
exercisable.  The Downes Agreement  expires on December 31, 2008 unless extended
in writing by the Company.

                                       12



OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

     The following table sets forth  information  regarding  outstanding  equity
awards held by each Named  Executive  Officer at fiscal year ended  December 31,
2006.



---------------------------------------------------------------------------------------------
                             OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

---------------------------------------------------------------------------------------------
                                            OPTIONS AWARDS
---------------------------------------------------------------------------------------------
       Name                   Number of Securities         Option            Option
                             Underlying Unexercised       Exercise       Expiration Date
                                    Options                Price
                                  Exercisable
                                                                             
---------------------------------------------------------------------------------------------
Bradley Meier                           1,500,000           $1.06            01/15/2010  (1)
---------------------------------------------------------------------------------------------
Bradley Meier                             250,000           $1.06            01/15/2010  (1)
---------------------------------------------------------------------------------------------
Bradley Meier                             250,000           $1.63            05/07/2008
---------------------------------------------------------------------------------------------
Bradley Meier                             150,000           $1.10            01/26/2010
---------------------------------------------------------------------------------------------
Bradley Meier                              20,000           $0.70            12/12/2010
---------------------------------------------------------------------------------------------
Bradley Meier                             325,000           $0.70            12/12/2010
---------------------------------------------------------------------------------------------
Bradley Meier                             150,000           $0.60            12/21/2011
---------------------------------------------------------------------------------------------
Bradley Meier                           1,000,000           $0.06            03/04/2014
---------------------------------------------------------------------------------------------
James Lynch                                50,000           $1.87            08/03/2008
---------------------------------------------------------------------------------------------
James Lynch                                25,000           $1.10            01/26/2010
---------------------------------------------------------------------------------------------
James Lynch                                15,000           $0.70            12/12/2010
---------------------------------------------------------------------------------------------
James Lynch                               100,000           $0.50            12/21/2011
---------------------------------------------------------------------------------------------
Sean Downes                                15,000           $1.10            01/26/2010
---------------------------------------------------------------------------------------------
Sean Downes                               100,000           $0.50            12/21/2011
---------------------------------------------------------------------------------------------



(1)  Expires  on  earlier  of  January  15,  2010 or a Change in  Control of the
Company, as defined in the Option Agreement.

              STOCK OWNED BY MANAGEMENT AND PRINCIPAL SHAREHOLDERS

     The close of  business on April 16, 2007 has been fixed by the Board as the
Record Date for determination of shareholders entitled to notice of, and to vote
at, the Annual Meeting The number of shares of voting stock held as of April 16,
2007 by each  holder  of more  than 5% of the  outstanding  voting  stock of the
Company,  each  director  of the  Company,  each  nominee  for  reelection  as a
director, each executive officer named in the Summary Compensation Table on page
11 of this Proxy  Statement  and all  directors  and  executive  officers of the
Company as a group is set forth below.

SERIES M PREFERRED STOCK OWNED BY MANAGEMENT

     As of April 16, 2007, directors and Named Executive Officers,  individually
and as a group, beneficially owned Series M Preferred Stock as follows:

                                       13






   Name and Address of Beneficial           Amount and Nature of Beneficial            Percent of Class
              Owner (1)                                Ownership                       ----------------
              -----                                    ---------
                                                                                       
Bradley I. Meier*(2)                                      48,890                             48.0%
Norman M. Meier* (3)                                      53,000                             52.0%
Officers and directors as a group                         86,890                             98.0%
    (2 persons) (4)



*    Director and Nominee

(1)  Unless otherwise indicated,  the Company believes that each person has sole
     voting  and  investment  rights  with  respect  to the  shares  of Series M
     Preferred  Stock  of  the  Company  specified  opposite  his  name.  Unless
     otherwise  indicated,  the  mailing  address  of  each  shareholder  is c/o
     Universal Insurance Holdings,  Inc., 1110 West Commercial Boulevard,  Suite
     100, Fort Lauderdale, Florida 33309.

(2)  Consists of (i) 33,890  shares of Series M Preferred  Stock and (ii) 15,000
     shares of Series M Preferred Stock beneficially owned by Belmer Partners, a
     Florida  General  Partnership  ("Belmer"),  of which Mr. Meier is a general
     partner. Excludes all shares of Series M Preferred Stock owned by Norman M.
     Meier and Phyllis R. Meier, Mr. Meier's father and mother, respectively, as
     to which Mr. Meier disclaims beneficial ownership.

(3)  Consists of (i) 38,000  shares of Series M Preferred  Stock and (ii) 15,000
     shares of Series M Preferred Stock  beneficially  owned by Belmer, of which
     Mr. Meier is a general  partner.  Excludes all shares of Series M Preferred
     Stock owned by Bradley I. Meier and Phyllis R. Meier,  Mr.  Meier's son and
     former spouse,  respectively,  as to which Mr. Meier  disclaims  beneficial
     ownership.

(4)  See footnotes (1) - (3) above.


SERIES A PREFERRED STOCK OWNED BY MANAGEMENT

     As of April 16, 2007, directors and Named Executive Officers,  individually
and as a group, beneficially owned Series A Preferred Stock as follows:




   Name and Address of Beneficial           Amount and Nature of Beneficial            Percent of Class
              Owner (1)                                Ownership                       ----------------
              -----                                    ---------
                                                                                       
Norman M. Meier* (2)                                       9,975                             20%
Officers and directors as a group                         86,890                             20%
    (1 person) (3)



*    Director and Nominee

(1)  Unless otherwise indicated,  the Company believes that each person has sole
     voting  and  investment  rights  with  respect  to the  shares  of Series A
     Preferred  Stock  of  the  Company  specified  opposite  his  name.  Unless
     otherwise  indicated,  the  mailing  address  of  each  shareholder  is c/o

                                       14


     Universal Insurance Holdings,  Inc., 1110 West Commercial Boulevard,  Suite
     100, Fort Lauderdale, Florida 33309.

(2)  Consists of 9,975 shares of Series A Preferred Stock  beneficially owned by
     Belmer,  of which Mr.  Meier is a general  partner.  Excludes all shares of
     Series A  Preferred  Stock owned by Phyllis R. Meier,  Mr.  Meier's  former
     spouse, as to which Mr. Meier disclaims beneficial ownership.

(3)  See footnotes (1) - (2) above.

COMMON STOCK OWNED BY MANAGEMENT

     As of April 16, 2007, directors and Named Executive Officers,  individually
and as a group, beneficially owned Common Stock as follows:



   Name and Address of Beneficial Owner (1)           Amount and Nature of Beneficial            Percent of Class
   ------------------------------------               -------------------------------            ----------------
                                                                 Ownership (2)
                                                                 -------------
                                                                                                  
Bradley I. Meier (3)                                            22,497,335                              59.1%
Sean P. Downes (4)                                               4,226,121                              11.1%
Norman M. Meier (5)                                                504,246                               1.3%
Reed J. Slogoff (6)                                                290,000                                .8%
Joel M. Wilentz (7)                                                290,000                                .8%
James M. Lynch (8)                                                 290,807                                .8%
Ozzie A. Schindler (9)                                              35,000                                .1%
Officers and directors as a group (7 people)                    28,800,400                              74.0%
     (10)



(1)  Unless otherwise indicated,  the Company believes that each person has sole
     voting and investment  rights with respect to the shares of Common Stock of
     the Company specified  opposite his name. Unless otherwise  indicated,  the
     mailing address of each  shareholder is c/o Universal  Insurance  Holdings,
     Inc., 1110 West Commercial Boulevard,  Suite 100, Fort Lauderdale,  Florida
     33309.

(2)  A person is deemed to be the  beneficial  owner of Common Stock that can be
     acquired by such person within 60 days of the date hereof upon the exercise
     of warrants or stock  options or  conversion  of Series A Preferred  Stock,
     Series  M  Preferred  Stock  or  convertible   debt.  Except  as  otherwise
     specified,  each beneficial owner's  percentage  ownership is determined by
     assuming that warrants,  stock options,  Series A Preferred Stock, Series M
     Preferred Stock and convertible  debt that are held by such person (but not
     those held by any other  person) and that are  exercisable  or  convertible
     within 60 days from the date hereof, have been exercised or converted.

(3)  Includes (i) options to purchase an aggregate of 3,645,000 shares of Common
     Stock;  (ii) 169,450  shares of Common Stock  issuable  upon  conversion of
     Series M Preferred  Stock;  (iii) an aggregate of 331,761  shares of Common
     Stock (including  shares of Common Stock issuable upon exercise of warrants
     and conversion of Series A and Series M Preferred Stock) beneficially owned
     by Belmer, of which Mr. Meier is a general partner;  and (iv) the following
     shares of Common Stock which are subject to proxies  granting  voting power

                                       15



     to Mr.  Meier:  (A) 333,792  shares  owned by Phyllis  Meier,  Mr.  Meier's
     mother,  (B) 504,246 shares owned by Norman Meier, Mr. Meier's father,  (C)
     an additional 207,916 shares over which Mr. Meier has voting power, and (D)
     options to purchase an aggregate of 1,115,000  shares of Common Stock owned
     by Norman Meier, Mr. Meier's father,  which are subject to a proxy granting
     voting power to Mr. Meier.

(4)  Includes  options to  purchase  an  aggregate  of 465,000  shares of Common
     Stock.

(5)  Includes (i) 214,938  shares of Common Stock  issuable  upon  conversion of
     Series A and Series M Preferred  Stock,  and (ii) an  aggregate  of 331,761
     shares of Common  Stock  (including  shares of Common Stock  issuable  upon
     exercise  of  warrants  and  conversion  of Series A and Series M Preferred
     Stock)  beneficially  owned by Belmer,  of which  Norman Meier is a general
     partner.  Excludes (i) all securities  owned by Bradley I. Meier or Phyllis
     Meier,  Norman  Meier's son and former  spouse,  respectively,  as to which
     Norman Meier disclaims beneficial ownership,  and (ii) all securities owned
     by Norman Meier for which Norman Meier has granted voting power to his son,
     Bradley Meier.

(6)  Includes  options to  purchase  an  aggregate  of 230,000  shares of Common
     Stock,  of which 50,000 are held in a custodial  account for Mr.  Slogoff's
     minor son.

(7)  Includes  options to  purchase  an  aggregate  of 240,000  shares of Common
     Stock.

(8)  Includes  options to  purchase  an  aggregate  of 215,000  shares of Common
     Stock.

(9)  Consists of an option to purchase 35,000 shares of Common Stock.

(10) See footnotes (1) - (9) above.


SERIES M PREFERRED STOCK HELD BY OTHERS

     As of April 16, 2007, the following table sets forth information  regarding
the number and percentage of Series M Preferred Stock held by all persons, other
than those persons  listed  immediately  above,  who are known by the Company to
beneficially  own or exercise  voting or dispositive  control over 5% or more of
the Company's outstanding Series M Preferred Stock:

                                      Amount and Nature of
Name and Address (1)                  Beneficial Ownership     Percent of Class
----------------                      --------------------     ----------------
Phyllis R. Meier (2)                         16,800                  18.9%
Universal Insurance Holdings, Inc.
1110 West Commercial Boulevard
Suite 100
Fort Lauderdale, Florida 33309

                                       16



Belmer Partners (3)                          15,000                  16.9%
c/o Phyllis R. Meier
Managing General Partner
Universal Insurance Holdings, Inc.
1110 West Commercial Boulevard
Suite 100
Fort Lauderdale, Florida 33309

(1)  Unless otherwise indicated,  the Company believes that each person has sole
     voting  and  investment  rights  with  respect  to the  shares  of Series M
     Preferred Stock specified opposite her or its name.

(2)  Consists of (i) 1,800  shares of Series M  Preferred  Stock and (ii) 15,000
     shares of Series M Preferred Stock  beneficially  owned by Belmer, of which
     Ms. Meier is the managing general partner. Excludes all securities owned by
     Bradley  I.  Meier  and  Norman  M.  Meier,  the  son  and  former  spouse,
     respectively, as to which Ms. Meier disclaims beneficial ownership.

(3)  Belmer Partners is a Florida general  partnership in which Phyllis R. Meier
     is  managing  general  partner and Bradley I. Meier and Norman M. Meier are
     general partners.

SERIES A PREFERRED STOCK HELD BY OTHERS

     As of April 16, 2007, the following table sets forth information  regarding
the number and percentage of Series A Preferred Stock held by all persons, other
than those persons  listed  immediately  above,  who are known by the Company to
beneficially  own or exercise  voting or dispositive  control over 5% or more of
the Company's outstanding Series A Preferred Stock:

                                     Amount and Nature of
Name and Address (1)                 Beneficial Ownership      Percent of Class
----------------                     --------------------      ----------------
Phyllis R. Meier (2)                         9,975                   20.0%
Universal Insurance Holdings, Inc.
1110 West Commercial Boulevard
Suite 100
Fort Lauderdale, Florida 33309

Belmer Partners (3)                          30,000                  60.0%
c/o Phyllis R. Meier
Managing General Partner
Universal Insurance Holdings, Inc.
1110 West Commercial Boulevard
Suite 100
Fort Lauderdale, Florida 33309

(1)  Unless otherwise indicated,  the Company believes that each person has sole
     voting  and  investment  rights  with  respect  to the  shares  of Series A
     Preferred Stock specified opposite her or its name.

                                       17



(2)  Consists of 9,975 shares of Series A Preferred  Stock  beneficially  owned.
     Excludes  all shares of Series A Preferred  Stock owned by Norman M. Meier,
     Ms.  Meier's  former  spouse,  as to which Ms. Meier  disclaims  beneficial
     ownership.

(3)  Belmer Partners is a Florida general  partnership in which Phyllis R. Meier
     is  managing  general  partner and Bradley I. Meier and Norman M. Meier are
     general partners.

COMMON STOCK HELD BY OTHERS

     As of April 16, 2007, the following table sets forth information  regarding
the number and percentage of Common Stock held by all persons,  other than those
persons listed  immediately  above, who are known by the Company to beneficially
own or exercise  voting or dispositive  control over 5% or more of the Company's
outstanding Common Stock:

                                        Amount and Nature of
Name and Address (1)                  Beneficial Ownership (2)  Percent of Class
----------------                      --------------------      ----------------
Martin Steinberg, Esq., as the               6,518,004               17.1%
receiver for Lancer Offshore Inc. (3)
c/o David E. Wells, Esq.
Hunton & Williams LLP
1111 Brickell Avenue,  Suite 2500
Miami, Florida 33131


(1)  Unless otherwise indicated,  the Company believes that each person has sole
     voting and investment  rights with respect to the shares of Common Stock of
     the Company specified opposite his name.

(2)  A person is deemed to be the  beneficial  owner of Common Stock that can be
     acquired by such person within 60 days of the date hereof upon the exercise
     of  warrants  or stock  options  or  conversion  of  Series A and  Series M
     Preferred Stock or convertible  debt. Except as otherwise  specified,  each
     beneficial  owner's  percentage  ownership is  determined  by assuming that
     warrants,  stock  options,  Series  A and  Series  M  Preferred  Stock  and
     convertible  debt that are held by such a person (but not those held by any
     other person) and that are exercisable within 60 days from the date hereof,
     have been exercised or converted.

(3)  Consists of  6,518,004  shares of Common Stock as indicated on Schedule 13D
     dated July 10, 2003 filed with the  SEC on March 5, 2004.

                                       18




                  AMENDMENT OF THE CERTIFICATE OF INCORPORATION
                                  (PROPOSAL 2)

     The Company is currently  authorized to issue  50,000,000  shares of Common
Stock,  par value $0.01 per share,  of which,  as of April 16, 2007,  38,057,103
shares were  issued and  outstanding.  Thus,  as of April 16,  2007,  there were
approximately 11,942,897 shares of Common Stock that were unissued. In addition,
the Company is  obligated  to issue  shares of Common Stock upon the exercise of
stock options and warrants granted by the Company and upon the conversion of the
Company's outstanding preferred stock.

     In these circumstances, the Board determined that it would be advisable and
in the best  interest  of the  Company  to amend the  Company's  Certificate  of
Incorporation,  as amended and restated  ("Certificate  of  Incorporation"),  to
increase  the  number of  authorized  shares  of  Common  Stock in order to have
additional  shares available for issuance to meet various business needs as they
may arise and to enhance the Company's  flexibility in connection  with possible
future  actions.  Those  business  needs  and  actions  may  include  additional
financing, stock dividends,  stock splits, employee benefit programs,  corporate
business combinations and other corporate purposes.  While the Company currently
has no arrangements,  understandings or commitments with respect to the issuance
of any  additional  shares of Common Stock,  it is considered  advisable to have
sufficient  authorized and unissued shares  available to enable the Company,  as
the need may arise, to move promptly to take advantage of market  conditions and
the availability of other favorable  opportunities without the delay and expense
involved in calling a special meeting of shareholders. Unless otherwise required
by applicable law or regulation,  the additional  shares of Common Stock will be
issuable  without further  authorization  by vote or consent of the shareholders
and on such terms and for such consideration as may be determined by the Board.

     Pursuant to that  determination,  on March 13, 2007, the Board of Directors
unanimously  approved and recommended that the Company's  shareholders  consider
and approve an amendment to Article IV of the  Certificate of  Incorporation  of
the Company to increase the number of  authorized  shares of Common Stock of the
Company from 50,000,000 shares to 55,000,000 shares.

     The  authorization  of additional  shares of Common Stock  pursuant to this
proposal  will have no dilutive  effect upon  proportionate  voting power of the
present  shareholders  of the  Company.  However,  to the extent that shares are
subsequently  issued in connection  with any  corporate  action to persons other
than the present shareholders, such issuance could have a dilutive effect on the
earnings per share and voting power of present shareholders.

     In addition,  although the issuance of additional shares of Common Stock in
certain  instances may have the effect of forestalling a hostile  takeover,  the
Board does not  intend nor does it view the  increase  in  authorized  shares of
Common  Stock as an  anti-takeover  measure.  The  Company  is not  aware of any
proposed or contemplated transaction of this type, and the proposed amendment to
the  Certificate of  Incorporation  is not being  recommended in response to any
specific effort of which the Company is aware to obtain control of the Company.

     At the Annual  Meeting,  the  shareholders  will be asked to  consider  the
proposal  recommended  by the Board to amend  Article IV of the  Certificate  of
Incorporation. As proposed to be amended, paragraph (a) of Article IV would read
as follows:

                                       19



          The  total  number  of  shares  of all  classes  of  stock  which  the
          Corporation shall have the authority to issue is 56,000,000 shares, of
          which:

               (i) 55,000,000 shares shall be designated as Common Stock, having
          a par value of $.01 per share (the "Common Stock"); and

               (ii)  1,000,000  shares shall be designated  as Preferred  Stock,
          having a par value of $.01 per share.

     If the amendment is approved by the Company's shareholders,  it will become
effective upon the filing of a Certificate  of Amendment in accordance  with the
General Corporation Law of Delaware.

     THE  BOARD  UNANIMOUSLY  RECOMMENDS  A VOTE FOR THE  PROPOSAL  TO AMEND THE
CERTIFICATE  OF  INCORPORATION  TO INCREASE THE NUMBER OF  AUTHORIZED  SHARES OF
COMMON STOCK.



           APPROVAL OF FORMULAS USED TO CALCULATE PERFORMANCE BONUSES
                                  (PROPOSAL 3)

     The Company  believes  that linking the  compensation  of key  employees to
corporate  performance  increases  employee  motivation  to improve  shareholder
value. Thus, the employee's reward is directly related to the Company's success.
The purposes of the  performance-based  bonuses for key employees is to motivate
the  employees to improve  shareholder  value by linking a portion of their cash
compensation to the Company's  financial  performance,  reward key employees for
improving the Company's  financial  performance  and help attract and retain key
employees.

     The Company is seeking  shareholder  approval of the material  terms of the
performance goals under which annual performance-based bonuses are to be paid to
two of its key  employees,  Bradley  I.  Meier,  President  and Chief  Executive
Officer of the Company,  and Sean P.  Downes,  Senior Vice  President  and Chief
Operating  Officer of the Company.  The material terms of the performance  goals
related to these bonus arrangements are set forth in an amendment to each of the
respective officers' employment agreements. The following summary of these bonus
arrangements  is qualified in its entirety by reference to the provisions of the
arrangements  contained in the  amendments to the  employment  agreements of Mr.
Meier and Mr. Downes,  which are attached to this Proxy  Statement as Appendix B
and Appendix C, respectively.

     Under Mr. Meier's employment agreement, Mr. Meier is entitled to receive an
annual performance bonus ("Meier Performance Bonus") equal to three percent (3%)
of  the  Company's  pre-tax  income  not  in  excess  of  five  million  dollars
($5,000,000),  and four percent (4%) of the Company's  pre-tax  income over five
million  dollars  ($5,000,000),  as determined in accordance  with the Company's
financial  statements.  The bonus is  computed as at December 31 for each fiscal
year and must be paid by December 31 of the year  following the year in which it
is earned.  The Board  unanimously  approved the formula  used to calculate  the
Meier Performance Bonus, and the Compensation Committee of the Board unanimously
confirmed its approval of the Meier  Performance  Bonus for the 2006 fiscal year
as recently as March 14, 2007. The Benefits Table below sets forth the amount of

                                       20



the Meier Performance Bonus determined for the most recent completed fiscal year
of the  Company,  of  which  $483,498  has  been  paid  and is  not  subject  to
shareholder  approval and of which  $591,811 has not been paid and is contingent
on the Company obtaining shareholder approval of the performance goal applicable
under Mr. Meier's employment agreement.  Similarly,  the Meier Performance Bonus
for fiscal years after 2006 is contingent on  shareholder  approval and will not
be payable if  shareholder  approval is not obtained.  Accordingly,  the Company
hereby  seeks  approval  of the  use  of the  Company's  pre-tax  income  as the
performance  goal  applicable  to the remainder of the Meier  Performance  Bonus
payable  for 2006,  as well as the Meier  Performance  Bonus  for  fiscal  years
thereafter.

     Under Mr. Downes' employment  agreement,  Mr. Downes is entitled to receive
an annual performance bonus ("Downes  Performance Bonus") equal to three percent
(3%) of the pre-tax profits of the Company, as determined in accordance with the
Company's financial statements. The bonus is computed as at December 31 for each
fiscal year and must be paid by December  31 of the year  following  the year in
which it is earned. The Board unanimously approved the formula used to calculate
the  Downes  Performance  Bonus,  and the  Compensation  Committee  of the Board
unanimously  confirmed its approval of the Downes Performance Bonus for the 2006
fiscal year as recently as March 14, 2007.  The Benefits  Table below sets forth
the  amount of the  Downes  Performance  Bonus  determined  for the most  recent
completed fiscal year of the Company, of which $400,123 has been paid and is not
subject to  shareholder  approval and of which $443,859 has not been paid and is
contingent on the Company obtaining shareholder approval of the performance goal
applicable  under  Mr.  Downes'  employment  agreement.  Similarly,  the  Downes
Performance  Bonus for fiscal  years  after 2006 is  contingent  on  shareholder
approval  and will not be  payable  if  shareholder  approval  is not  obtained.
Accordingly,  the Company  hereby  seeks  approval  of the use of the  Company's
pre-tax  profits as the  performance  goal  applicable  to the  remainder of the
Downes  Performance  Bonus payable for 2006,  as well as the Downes  Performance
Bonus for fiscal years thereafter.

     Upon  completion  of each fiscal year,  the  Compensation  Committee of the
Board  will  certify  in  writing  prior to  payment  of the  Meier  and  Downes
Performance Bonuses that the applicable  performance objective has been attained
and the bonus is payable. With respect to Compensation Committee  certification,
approved  minutes  of the  meeting  in which the  certification  is made will be
treated as written certification.

     The Company and Mr. Meier or Mr.  Downes,  as the case may be, may agree to
amend or terminate the bonus  arrangement at any time by entering into a written
amendment or modification of the applicable employment agreement.

     Under Section 162(m) of the Internal Revenue Code of 1986, as amended,  the
federal  income tax  deductibility  of  compensation  paid to Mr.  Meier and Mr.
Downes  may be limited to the  extent  that it exceeds  $1.0  million in any one
year.  The  Company  can  deduct  compensation  in excess  of that  amount if it
qualifies as  "performance-based  compensation"  under Section  162(m).  For the
Meier  and  Downes   Performance   Bonuses  to  qualify  as   "performance-based
compensation,"  the  performance-based  formulas used to determine  them must be
approved by the Company's shareholders. The Meier and Downes Performance Bonuses
are intended to permit the Company to pay incentive compensation which qualifies
as "performance-based compensation," thereby permitting the Company to receive a
federal income tax deduction for the payment of this incentive compensation.

                                       21



     The following table sets forth the total amounts that would be payable with
respect to the Meier and Downes Performance Bonuses for fiscal year 2006, in the
event shareholder approval of the applicable performance goals is obtained:

                                  NEW BENEFITS

NAME AND PRINCIPAL POSITION                                DOLLAR VALUE ($)

Bradley I. Meier
President and Chief Executive Officer                            $1,075,309  (1)

Sean P. Downes
Senior Vice President and Chief Operating Officer                  $843,982  (2)

James M. Lynch
Executive Vice President and Chief Financial Officer                     $0

All executive officers as a group                                $1,919,291

All non-executive directors as a group                                   $0

All non-executive officer employees as a group                           $0


-------------------------------
(1)  $483,498 of which has already been paid.

(2)  $400,123 of which has already been paid.

     THE BOARD  UNANIMOUSLY  RECOMMENDS  A VOTE FOR THE  PROPOSAL TO APPROVE THE
MEIER PERFORMANCE BONUS AND THE DOWNES PERFORMANCE BONUS.


          APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
                                  (Proposal 4)

     The Audit  Committee  recommended and the Board approved the appointment of
     the  accounting  firm  Blackman  Kallick  Bartelstein  LLP as the Company's
     independent  registered  public  accounting  firm for the fiscal year 2007,
     subject to  shareholder  ratification.  Blackman  Kallick  Bartelstein  LLP
     audited  the  Company's  financial  statements  for the fiscal  years ended
     December 31, 2004, 2005 and 2006.

AUDIT FEES

     Audit fees for the fiscal  years ended  December  31, 2006 and December 31,
     2005 were $260,000 and $176,000, respectively.

                                       22


AUDIT RELATED FEES

     Audit  related  fees for the  fiscal  years  ended  December  31,  2006 and
     December 31, 2005 were $0.

TAX FEES

     Tax fees for the fiscal years ended December 31, 2006 and December 31, 2005
were $33,500 and $31,500, respectively.

ALL OTHER FEES

     All  other  fees  for  products  and  services  provided  by the  Company's
principal  accountant  for the fiscal years ended December 31, 2006 and December
31, 2005 were $0.

POLICY  ON AUDIT  COMMITTEE  PRE-APPROVAL  OF AUDIT  AND  PERMISSIBLE  NON-AUDIT
SERVICES OF THE INDEPENDENT AUDITOR

     All audit related services were pre-approved by the Audit Committee,  which
concluded  that the provision of such services by Blackman  Kallick  Bartelstein
LLP was  compatible  with the  maintenance  of that firm's  independence  in the
conduct of its auditing  functions.  The Board has  appointed  Blackman  Kallick
Bartelstein  LLP  to  serve  as  the  Company's  independent  registered  public
accounting firm for the fiscal year ending December 31, 2007. Representatives of
Blackman  Kallick  Bartelstein LLP will be available at the Annual Meeting where
they will have the  opportunity  to make a statement if they desire to do so and
where they will be available to respond to any appropriate questions.

     THE  BOARD  UNANIMOUSLY  RECOMMENDS  A VOTE  FOR  THE  RATIFICATION  OF THE
APPOINTMENT OF BLACKMAN  KALLICK  BARTELSTEIN  LLP AS THE COMPANY'S  INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2007.

                                  ANNUAL REPORT

     A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB, WITHOUT EXHIBITS, FOR
THE FISCAL YEAR ENDED DECEMBER 31, 2006 ACCOMPANIES  THIS PROXY STATEMENT.  UPON
WRITTEN REQUEST, THE COMPANY WILL PROVIDE TO ANY SHAREHOLDER,  FREE OF CHARGE, A
COPY OF ITS ANNUAL REPORT ON FORM 10-KSB,  WITHOUT  EXHIBITS,  AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION.  REQUESTS FOR COPIES OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-KSB SHOULD BE DIRECTED TO JAMES M. LYNCH,  UNIVERSAL INSURANCE
HOLDINGS,  INC., 1110 WEST  COMMERCIAL  BOULEVARD,  SUITE 100, FORT  LAUDERDALE,
FLORIDA 33309.


             SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section  16(a)  of the  Exchange  Act  requires  the  Company's  directors,
executive  officers,  and persons who own more than 10% of the Company's  Common
Stock to file initial  reports of ownership  and reports of changes in ownership

                                       23



with the SEC.  Directors,  executive  officers and greater than 10% shareholders
(collectively,  "Reporting  Persons") are required by SEC regulations to furnish
the Company with copies of all Section 16(a) forms they file.

     Mr. Downes failed to file a Form 4 in connection with an acquisition of the
Company's Common Stock in fiscal year 2006, but  subsequently  filed a Form 5 on
February  1,  2007   reflecting  this   transaction.   Except  for  Mr.  Downes'
transaction,  and based solely on review of the copies of such forms provided to
the Company and written  representations by the Reporting  Persons,  the Company
believes  that,  for the year ended  December 31, 2006, all Section 16(a) filing
requirements applicable to the Reporting Persons were met.

                              SHAREHOLDER PROPOSALS

     Proposals of  shareholders  intended to be presented at the Company's  2008
annual  meeting of  shareholders  must be  received by the Company no later than
December  10,  2007  to be  considered  for  inclusion  in the  Company's  proxy
statement and form of proxy  relating to such meeting.  Shareholders  wishing to
submit a proposal at the 2008 annual meeting of shareholders  that do not intend
to include the proposal in the Company's  proxy  statement for that meeting must
provide appropriate notice to the Company by February 11, 2008.

                                  OTHER MATTERS

     The Company  knows of no business  that will be presented for action at the
Annual Meeting other than those matters referred to herein.  If other matters do
come  before  the  meeting,  the  persons  named  as  proxies  will act and vote
according to their best judgment on behalf of the shareholders they represent.


                                          BY ORDER OF THE BOARD OF DIRECTORS


                                          DRAFT
                                          -----
                                          Norman M. Meier, Secretary

Dated:  April [      ], 2007

                                       24



                                   APPENDIX A

                       UNIVERSAL INSURANCE HOLDINGS, INC.

                         CHARTER OF THE AUDIT COMMITTEE
                         ------------------------------

                          ADOPTED AS OF JANUARY 9, 2007

I.   PURPOSE

The purpose of the Audit Committee (the  "Committee") is to represent and assist
the Board of Directors (the "Board") in its general  oversight of the accounting
and financial reporting processes, audits of the financial statements,  internal
control and audit functions, and finance, auditing, accounting, legal, financial
reporting and regulatory  compliance of Universal Insurance Holdings,  Inc. (the
"Company").   Company   management  is  responsible  for  (a)  the  preparation,
presentation and integrity of the Company's financial statements; (b) accounting
and financial reporting principles; and (c) the internal controls and procedures
designed to promote compliance with accounting standards and applicable laws and
regulations.   The  Company's  independent  auditing  firm  is  responsible  for
performing an  independent  audit of the  consolidated  financial  statements in
accordance with generally accepted auditing standards.

The Committee  members are not  professional  accountants  or auditors and their
functions  are not  intended  to  duplicate  or to  certify  the  activities  of
management and the independent  auditor,  nor can the Committee certify that the
independent  auditor is  "independent"  under  applicable  rules.  While certain
duties and  responsibilities  of the Committee are more  specifically  set forth
below, the general function of the Committee is oversight.

II.  MEMBERSHIP AND STRUCTURE

The Committee shall consist of at least three directors determined by the Board.
If the Company's  securities  are quoted on the American  Stock Exchange (or any
other national securities association or exchange), Committee members shall meet
the  independence  and  financial  literacy  requirements  of such  exchange  or
association and applicable federal law. Appointment to the Committee,  including
the  designation  of the Chair of the  Committee  and, if required by applicable
law, the  designation  of any Committee  members as "audit  committee  financial
experts,"  shall be made by the full  Board.  The  Board  may from  time to time
remove  members of the  Committee  and fill any  vacancies on the Committee by a
majority vote of the Company's directors serving on the Board.

III. MEETINGS, REPORTS, SUBCOMMITTEES, RESOURCES AND EVALUATIONS

(a) MEETINGS AND REPORTS.  The Committee  shall meet as often as it  determines,
but not less  frequently  than  quarterly.  The  Committee may also hold special
meetings or act by unanimous  written  consent as the Committee may decide.  The
meetings may be in person or by telephone.  At each meeting of the Committee,  a
majority of the members shall constitute a quorum, and a majority of the members
present at any  meeting  at which a quorum is  present  may act on behalf of the
Committee.  The Committee shall maintain written minutes of its meetings,  which
minutes  will be filed  with the  minutes  of the  meetings  of the  Board.  The

                                      A-1



Committee shall also make regular reports to the Board. The Committee shall meet
with management and the independent  auditor in separate  executive  sessions as
appropriate. The Committee may periodically consult with the independent auditor
out of the presence of management  regarding  internal controls and the fullness
and accuracy of the Company's  financial  statements.  The Committee may request
any officer or employee of the Company or the Company's  outside  counsel or the
independent  auditor  to attend a meeting of the  Committee  or to meet with any
members of, or consultants to, the Committee.

In order to encourage and facilitate open communication,  the Committee may meet
with management,  the internal auditing group and the independent auditor in one
or more  separate  sessions to discuss any matters that the  Committee or any of
these groups  believe should be discussed.  In addition,  the Committee may meet
with the  independent  auditor and management  quarterly to review the financial
statements of the Company.

(b)   SUBCOMMITTEES.   The  Committee   may  form  and  delegate   authority  to
subcommittees, or to one or more members of the Committee, when appropriate.

(c)  RESOURCES.  The  Committee  is at all  times  authorized  to  have  direct,
independent and confidential access to the Company's other directors, management
and personnel to carry out the  Committee's  purposes.  The Committee shall have
the  authority,  to the  extent it deems  necessary  or  appropriate,  to retain
independent  legal,  accounting  or other  advisors.  The Company  shall provide
appropriate funding, as determined by the Committee,  to permit the Committee to
perform  its duties  under this  Charter,  to  compensate  its  advisors  and to
compensate  any  registered  public  accounting  firm engaged for the purpose of
rendering or issuing an audit report or related work or performing  other audit,
review or attest services for the Company.

(d)  EVALUATIONS.   The  Committee  shall  evaluate  the  adequacy  of  its  own
performance  and this  Charter on an annual  basis and shall report to the Board
annually the results of an annual review by the Committee of its own performance
and shall recommend any proposed changes to the Board for approval.


IV.  Committee Authority and Responsibilities

The  Committee,  at its  discretion,  has  the  authority  to  initiate  special
investigations  and to hire special legal,  accounting or other outside advisors
or experts to assist the  Committee as it deems  necessary to fulfill its duties
under this  Charter.  The  Committee  may also  perform  such  other  activities
consistent with this Charter,  the Company's  Certificate of  Incorporation  and
governing  law, as the  Committee or the Board deems  necessary or  appropriate.
When  appropriate,  the  Committee  may  designate one or more of its members to
perform  certain of its duties on its behalf,  subject to such  reporting  to or
ratification by the Committee as the Committee shall direct.

The Committee, to the extent it deems necessary or appropriate, shall:

Oversight of the Company's Relationship with the Independent Auditor
--------------------------------------------------------------------

o    Be directly responsible for the appointment, replacement, compensation, and
     oversight of the work of the independent  auditor of the Company (including
     resolution of disagreements  between management and the independent auditor

                                      A-2



     regarding  financial  reporting) for the purpose of preparing or issuing an
     audit report or  performing  other audit,  review or attest  services.  The
     independent auditor shall report directly to the Committee.

o    If deemed  necessary  or  advisable  by the  Committee,  obtain  and review
     annually  a report by the  independent  auditor  describing  (a) the firm's
     internal quality control procedures;  (b) any material issues raised by the
     most  recent  internal  quality  control  review  or peer  review or by any
     inquiry or  investigation  by  governmental  or  professional  authorities,
     within the preceding five years,  respecting one or more independent audits
     carried out by the firm;  (c) any steps taken to deal with any such issues;
     (d) any  relationships  or  services  that may affect the  objectivity  and
     independence of the independent auditor; and (e) all relationships  between
     the independent auditor and the Company,  including considering whether the
     auditor's  quality  controls are  adequate  and the  provision of permitted
     non-audit   services  is   compatible   with   maintaining   the  auditor's
     independence,  taking into account the opinions of management  and internal
     auditors.  The Committee shall present its conclusions  with respect to the
     independent auditor to the Board.

o    Establish  policies for the hiring of employees and former employees of the
     independent auditor.

o    Review and discuss  the  written  statement  from the  independent  auditor
     concerning  all   relationships   between  the  auditor  and  the  Company,
     consistent with  Independence  Standards Board Standard No. 1, or any other
     relationships  that may adversely  affect the  independence of the auditor,
     and, based on such review, assess the independence of the auditor.

o    Review and discuss with the  independent  auditor (a) its audit plans,  and
     audit  procedures,  including the scope,  fees and timing of the audit; (b)
     the results of the annual audit  examination  and  accompanying  management
     letters;  and (c) the results of the independent  auditor's procedures with
     respect to interim periods.

o    Review with the independent  auditor its judgments as to the quality of the
     Company's  accounting  principles  and such  matters as are  required to be
     discussed with the Committee under generally accepted auditing standards.

o    Meet and discuss  with the  independent  auditor (a) the issues on which it
     was consulted by the Company's audit team; (b) any matters of audit quality
     and   consistency,   and  (c)  any  audit  problems  or  difficulties   and
     management's responses to such problems or difficulties.

o    Review the use of auditors other than the independent auditor in cases such
     as management's request for second opinions.

Financial Statement and Disclosure Matters
------------------------------------------

o    Review and discuss with  management and the independent  auditor  quarterly
     earnings press  releases,  if applicable,  including the interim  financial
     information  included  therein  and the use of "pro  forma"  or  "adjusted"
     non-GAAP information,  review the year-end audited financial statements and
     "Management's Discussion and Analysis of Financial Condition and Results of
     Operations"  and, if deemed  appropriate,  recommend  to the Board that the
     audited financial statements be included in the annual report for the year.

                                      A-3



o    Discuss  with  management  financial   information  and  earnings  guidance
     provided to analysts and rating  agencies,  if applicable.  Such discussion
     may be general and address the types of information to be disclosed and the
     types of presentations to be made.

o    Review and discuss reports from the independent auditor on (a) all critical
     accounting  policies and  practices  used by the Company;  (b)  alternative
     accounting  treatments within GAAP related to material items that have been
     discussed with  management,  including the  ramifications of the use of the
     alternative  treatments  and the  treatment  preferred  by the  independent
     auditor;  and  (c)  other  material  written   communications  between  the
     independent auditor and management.

o    Discuss  with  management  and  the  independent  auditor  any  significant
     financial  reporting  issues  and  judgments  made in  connection  with the
     preparation   of  the  Company's   financial   statements,   including  any
     significant changes in the Company's selection or application of accounting
     principles,  any major issues as to the adequacy of the Company's  internal
     control over  financial  reporting  and any special  steps adopted or which
     need to be adopted in light of any material weaknesses.

o    Review and discuss with management and the independent auditor any subjects
     that may have  significant  financial impact on the Company or that are the
     subject of discussions between management and the independent auditor, such
     as  the  effect  of  regulatory  and  accounting  initiatives  as  well  as
     off-balance sheet structures.

o    Discuss with  management the Company's  major  financial risk exposures and
     the steps  management  has taken to monitor  and  control  such  exposures,
     including the Company's risk assessment and risk management policies.

o    To  the  extent   applicable,   review  and  retain   prior   approval  for
     related-party  transactions as may be required by such national  securities
     association or exchange on which the Company's securities are listed.

o    The  independent  auditor  shall  contact  the  Chairman  of the  Committee
     directly  (a) to review  items of a  sensitive  nature  that can affect the
     accuracy  of  financial  reporting;  or (b) to discuss  significant  issues
     relative to the overall Board responsibility that have been communicated to
     management but, in their judgment, may warrant follow-up by the Committee.

Oversight of the Company's Internal Audit Function
--------------------------------------------------

o    Review and  discuss  with  management,  the  independent  auditor,  and the
     internal audit group (or other person,  persons or outside firm responsible
     for  the  Company's   internal   audit   function)  (a)  the  adequacy  and
     effectiveness of the Company's  internal  controls  (including any material
     weaknesses and significant deficiencies and significant changes in internal
     controls   reported  to  the  Committee  by  the  independent   auditor  or
     management);  (b) the  Company's  internal  audit  procedures;  and (c) the
     adequacy  and  effectiveness  of  the  Company's  disclosure  controls  and
     procedures, and management reports thereon.

o    Review annually with the internal audit group (or other person,  persons or
     outside firm  responsible  for the Company's  internal audit  function) the
     scope of the internal audit program, and review annually the performance of
     both the  internal  audit group and the  independent  auditor in  executing
     their plans and meeting their objectives.

                                      A-4



o    Discuss with the  independent  auditor and  management  the internal  audit
     group  responsibilities,  budget and staffing and any recommended change in
     the planned scope of the internal audit.

o    Review  significant  reports to management  prepared by the internal  audit
     group and  management's  responses.  In  addition,  at the  request  of the
     Committee,  the internal  audit group (or other person,  persons or outside
     firm  responsible  for the Company's  internal audit function) shall report
     directly  to the  Committee  as to its  activities  and  any  other  matter
     requested of it by the Committee.

Compliance Oversight Responsibilities
-------------------------------------

o    Review  matters  related  to the  corporate  compliance  activities  of the
     Company.

o    Establish procedures for the receipt, retention and treatment of complaints
     received by the Company regarding accounting, internal accounting controls,
     or  auditing  matters,  and  the  confidential,   anonymous  submission  by
     employees  of  concerns  regarding  questionable   accounting  or  auditing
     matters.

o    Discuss with management and the independent auditor any correspondence with
     regulators or  governmental  agencies and any published  reports that raise
     material issues regarding the Company's financial  statements or accounting
     policies.

o    To the extent  applicable,  review and publish the report of the  Committee
     required  by the rules of the  Securities  and  Exchange  Commission  to be
     included in the Company's annual proxy statement.

Pre-Approval Policies
---------------------

To the extent required by applicable  law, the Committee  shall  pre-approve all
auditing services and permitted non-audit services,  including tax services,  to
be  performed  for the  Company by its  independent  auditor,  subject to the de
minimis exceptions for non-audit  services described in Section  10A(i)(1)(B) of
the  Securities  Exchange  Act of 1934,  as amended,  which are  approved by the
Committee prior to the completion of the audit.

                                      A-5



                                   APPENDIX B

                                  AMENDMENT TO
                    EMPLOYMENT AGREEMENT OF BRADLEY I. MEIER


          THIS AMENDMENT is made and entered into this 21st day of March,  2007,
by and between Universal  Insurance  Holdings,  Inc.  ("Company") and Bradley I.
Meier ("Executive").

          WHEREAS,  the Company and  Executive  have entered into an  Employment
Agreement dated as of August 11, 1999, and the following  Addendum thereto:  (i)
Addendum No. 3 dated May 4, 2001,  (ii)  Addendum No. 4 dated  January 28, 2002,
(iii)  Addendum No. 5 dated June 27, 2002,  and (iv) Addendum No. 6 effective as
of December 31, 2003 (collectively, the "Agreement").

          WHEREAS,  capitalized terms not defined herein shall have the meanings
set forth in the Agreement.

          WHEREAS, the Company and Executive desire to modify certain provisions
of the Agreement.

          NOW,  THEREFORE,  the parties  hereto  intending  to be legally  bound
hereby and upon receipt of other valuable consideration, the receipt of which is
hereby acknowledged, do hereby agree as follows:

     1.   Section 6(b) of the Agreement is hereby  amended to read in its
entirety as follows:

     "ANNUAL BONUS
      ------------

     Employee  shall  receive  an  annual  bonus of three  (3%)  percent  of the
     Company's pre-tax income up to five million dollars ($5,000,000),  and four
     (4%) percent of the  Company's  pre-tax  income over five  million  dollars
     ($5,000,000),  which  shall be  computed  as at December 31 for each fiscal
     year commencing  with the fiscal year ending  December 31, 1999;  PROVIDED,
     HOWEVER,  that in no event shall any bonus due and owing under this Section
     6(b) be paid to Executive  later than December 31 of the year following the
     year in which it was  earned;  PROVIDED,  FURTHER,  that the payment of any
     bonus pursuant to this Section 6(b) shall be contingent  upon the Company's
     shareholders  approving the bonus  formula  described in this Section 6(b),
     and should the  Company's  shareholders  fail to approve the bonus  formula
     described in this Section 6(b),  Executive  shall forfeit his right to such
     bonus compensation under this Section 6(b)."

     2.   Except as expressly  amended  herein,  the terms and  conditions  of
the Agreement are hereby ratified and affirmed.

                                      B-1



          WITNESS the due execution hereof as of the date first above written.


                                          UNIVERSAL INSURANCE HOLDINGS, INC.


                                          By:  /s/  James M. Lynch
                                              ---------------------------------
                                          Title:    Vice President
                                                -------------------------------



                                          /s/ Bradley I . Meier
                                          --------------------------------------
                                          Bradley I. Meier

                                      B-2



                                   APPENDIX C

                                  AMENDMENT TO
                     EMPLOYMENT AGREEMENT OF SEAN P. DOWNES


     THIS  AMENDMENT is made and entered into this 21st day of March,  2007,  by
and between Universal  Insurance Holdings,  Inc.  ("Company") and Sean P. Downes
("Executive").

     WHEREAS,  the  Company  and  Executive  have  entered  into  an  Employment
Agreement  dated as of January 1, 2005,  and an Addendum  thereto  dated May 22,
2006 (collectively, the "Agreement").

     WHEREAS,  capitalized  terms not defined herein shall have the meanings set
forth in the Agreement.

     WHEREAS,  the Company and Executive desire to modify certain  provisions of
the Agreement.

     NOW, THEREFORE, the parties hereto intending to be legally bound hereby and
upon  receipt of other  valuable  consideration,  the receipt of which is hereby
acknowledged, do hereby agree as follows:

     1.   Section 6(b) of the Agreement is hereby  amended to read in its
entirety as follows:

     "ANNUAL BONUS
      ------------

     Employee shall receive an annual bonus of three percent (3%) of the pre-tax
     profits of the Company as determined as at the year end of each year of the
     Term of this Agreement; PROVIDED, HOWEVER, that in no event shall any bonus
     due and owing  under  this  Section  6(b) be paid to  Executive  later than
     December  31 of the  year  following  the  year  in  which  it was  earned;
     PROVIDED,  FURTHER,  that the payment of any bonus pursuant to this Section
     6(b) shall be  contingent  upon the  Company's  shareholders  approving the
     bonus  formula  described in this Section  6(b),  and should the  Company's
     shareholders  fail to approve the bonus  formula  described in this Section
     6(b),  Executive shall forfeit his right to such bonus  compensation  under
     this Section 6(b)."

     2.   Except as expressly  amended  herein,  the terms and  conditions  of
the Agreement are hereby ratified and affirmed.



                         [SIGNATURES ON FOLLOWING PAGE]

                                      C-1




          WITNESS the due execution hereof as of the date first above written.


                                          UNIVERSAL INSURANCE HOLDINGS, INC.


                                          By: /s/ Bradley I. Meier
                                             -----------------------------------
                                          Title:  President
                                                --------------------------------



                                          /s/ Sean P. Downes
                                          --------------------------------------
                                          Sean P. Downes

                                      C-2



                                   APPENDIX D


             REVOCABLE PROXY FOR HOLDERS OF SERIES M PREFERRED STOCK

                       UNIVERSAL INSURANCE HOLDINGS, INC.
                 ANNUAL MEETING OF SHAREHOLDERS ON MAY 18, 2007

           THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints James M. Lynch, with full power of substitution,
as the lawful proxy of the  undersigned  and hereby  authorizes him to represent
and to vote as  designated  below  all  shares of  Series M  preferred  stock of
Universal  Insurance  Holdings,  Inc.  ("Company") that the undersigned would be
entitled to vote if personally  present at the Annual Meeting of Shareholders of
the Company to be held on May 18, 2007 at the executive  offices of the Company,
1110 West Commercial Boulevard,  Suite 100, Fort Lauderdale,  Florida 33309, and
at any adjournment thereof.  Holders of Series M preferred stock are entitled to
one vote per share.

1.  Proposal 1: Election of six  directors for a term ending in 2008.  Nominees:
    Bradley I. Meier, Norman M. Meier, Sean P. Downes, Ozzie A. Schindler,  Reed
    J. Slogoff and Joel M. Wilentz.

       FOR  [ ]                  WITHHELD  [ ]
       (all nominees except as marked below)

       _________________________________________________________________________
       (Instruction:   To  withhold   authority  to  vote  for  any   individual
       nominee(s), write the name(s) of the nominee(s) on the line above.)

2.  Proposal  2:  Approval  of an  amendment  to the  Company's  Certificate  of
    Incorporation, as amended and restated, to increase the number of authorized
    shares of common stock of the Company from  50,000,000  shares to 55,000,000
    shares.

       FOR  [ ]                  AGAINST  [ ]                 ABSTAIN [ ]

3.  Proposal 3: Approval of the formulas used to calculate  performance  bonuses
    in each of the amended employment  agreements of the Chief Executive Officer
    and the Chief Operating Officer of the Company.

       FOR  [ ]                  AGAINST  [ ]                 ABSTAIN [ ]

4.  Proposal 4: Ratification of the appointment of Blackman Kallick  Bartelstein
    LLP,  independent  registered public accounting firm, as the auditors of the
    Company for the year ending December 31, 2007.

       FOR  [ ]                  AGAINST  [ ]                 ABSTAIN [ ]

5.  In the  discretion  of such  proxy,  to transact  any other  business as may
    properly come before the annual meeting or any adjournment thereof.

This proxy, when properly executed,  will be voted in the manner directed herein
by the  undersigned  shareholder.  IF NO DIRECTION IS GIVEN,  THIS PROXY WILL BE
VOTED FOR THE MATTERS LISTED ABOVE.

Whether or not you plan to attend  the  meeting,  you are urged to  execute  and
return this proxy, which may be revoked at any time prior to its use.

                               Change of Address or Comments Mark Here  [  ]

                               Please  sign  your  name  exactly  as it  appears
                               hereon.  When  signing  as  attorney,   executor,
                               administrator,  trustee or guardian,  please give
                               full title as such. If a corporation, please sign
                               in full  corporate  name by  President  or  other
                               authorized officer. If a partnership, please sign
                               in partnership name by authorized person.

   Date ______, 2007           ________________________________________
                               Signature of Shareholder
                               ________________________________________
                               Signature of Additional Shareholder(s)


                                   APPENDIX E


    REVOCABLE PROXY FOR HOLDERS OF SERIES A PREFERRED STOCK AND COMMON STOCK

                       UNIVERSAL INSURANCE HOLDINGS, INC.
                 ANNUAL MEETING OF SHAREHOLDERS ON MAY 18, 2007
           THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

    The  undersigned  hereby  appoints  James  M.  Lynch,  with  full  power  of
substitution,  as the lawful proxy of the undersigned and hereby  authorizes him
to represent  and to vote as  designated  below all shares of Series A preferred
stock and all  shares of common  stock of  Universal  Insurance  Holdings,  Inc.
("Company") that the undersigned would be entitled to vote if personally present
at the Annual Meeting of  Shareholders of the Company to be held on May 18, 2007
at the executive offices of the Company, 1110 West Commercial  Boulevard,  Suite
100, Fort Lauderdale,  Florida 33309, and at any adjournment thereof. Holders of
Series A preferred stock and common stock are entitled to one vote per share.

1.  Proposal 1: Election of four directors for a term ending in 2008.  Nominees:
    Sean P. Downes, Ozzie A. Schindler, Reed J. Slogoff and Joel M. Wilentz.

       FOR  [ ]                    WITHHELD  [ ]
       (all nominees except as marked below)

       _________________________________________________________________________
       (Instruction:   To  withhold   authority  to  vote  for  any   individual
       nominee(s), write the name(s) of the nominee(s) on the line above.)

2.  Proposal  2:  Approval  of an  amendment  to the  Company's  Certificate  of
    Incorporation, as amended and restated, to increase the number of authorized
    shares of common stock of the Company from  50,000,000  shares to 55,000,000
    shares.

       FOR  [ ]                    AGAINST   [ ]                   ABSTAIN [ ]

3.  Proposal 3: Approval of the formulas used to calculate  performance  bonuses
    in each of the amended employment  agreements of the Chief Executive Officer
    and the Chief Operating Officer of the Company.

       FOR  [ ]                    AGAINST   [ ]                   ABSTAIN [ ]

4.  Proposal 4: Ratification of the appointment of Blackman Kallick  Bartelstein
    LLP,  independent  registered public accounting firm, as the auditors of the
    Company for the year ending December 31, 2007.

       FOR  [ ]                    AGAINST   [ ]                   ABSTAIN [ ]

5.  In the  discretion  of such  proxy,  to transact  any other  business as may
    properly come before the annual meeting or any adjournment thereof.

    This proxy,  when properly  executed,  will be voted in the manner  directed
herein by the undersigned shareholder. IF NO DIRECTION IS GIVEN, THIS PROXY WILL
BE VOTED FOR THE MATTERS LISTED ABOVE.

    Whether or not you plan to attend the meeting,  you are urged to execute and
return this proxy, which may be revoked at any time prior to its use.

                                 Change of Address or Comments Mark Here   [ ]

                                 Please  sign your name  exactly  as it  appears
                                 hereon.  When  signing as  attorney,  executor,
                                 administrator, trustee or guardian, please give
                                 full title as such.  If a  corporation,  please
                                 sign in full  corporate  name by  President  or
                                 other  authorized  officer.  If a  partnership,
                                 please sign in  partnership  name by authorized
                                 person.

Date: __________, 2007           ________________________________________
                                 Signature of Shareholder
                                 ________________________________________
                                 Signature of Additional Shareholder(s)