INSWEB CORPORATION

(in thousands)

(unaudited)

		March 31, 2009			December 31, 2008
Assets
Current assets:
Cash and cash equivalents		$	4,059		$	9,238
Short-term investments		1,998			—
Accounts receivable, net		3,483			1,450
Prepaid expenses and other current assets		544			711
Restricted cash		2,229			—
Total current assets		12,313			11,399
Related party receivable		306			304
Property and equipment, net		213			249
Other assets		301			329
Total assets		$	13,133		$	12,281
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable		$	3,364		$	2,138
Accrued expenses		1,033			1,014
Deferred revenue		422			437
Total current liabilities		4,819			3,589
Commitments and contingencies
Stockholders’ equity:
Common stock		8			8
Paid-in capital		206,843			206,719
Treasury stock		(6,334		)	(6,334		)
Unrealized gain on available-for-sale securities		1			1
Accumulated deficit		(192,204		)	(191,702		)
Total stockholders’ equity		8,314			8,692
Total liabilities and stockholders’ equity		$	13,133		$	12,281

See accompanying notes.

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INSWEB CORPORATION

(in thousands, except per share amounts)

(unaudited)

		Three Months  Ended March 31,
		2009			2008
Revenues:
Transaction fees		$	9,484		$	12,971
Other		42			61
Total revenues		9,526			13,032
Operating expenses:
Direct marketing		6,545			9,305
Sales and marketing		1,770			1,295
Technology		958			816
General and administrative		803			1,026
Total operating expenses		10,076			12,442
Income (loss) from operations		(550		)	590
Interest income		14			89
Income (loss) before income taxes		(536		)	679
Provision for (benefit from) income taxes		(35		)	9
Net income (loss)		$	(501	)	$	670
Net income (loss) per share:
Basic		$	(0.10	)	$	0.14
Diluted		$	(0.10	)	$	0.12
Weighted-average shares used in computing per share amounts
Basic		4,787			4,641
Diluted		4,787			5,783

See accompanying notes.

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INSWEB CORPORATION

(in thousands)

(unaudited)

		Three Months Ended  March 31,
		2009			2008
Cash flows from operating activities:
Net income (loss)		$	(501	)	$	670
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Share-based compensation		101			334
Depreciation and amortization		47			34
Related party receivable		(2		)	—
Net changes in operating assets and liabilities:
Accounts receivable		(2,033		)	(1,120		)
Prepaid expenses and other current assets		167			228
Other assets		17			—
Accounts payable		1,226			800
Accrued expenses		19			217
Deferred revenue		(15		)	(17		)
Net cash provided (used) by operating activities		(974		)	1,146
Cash flows from investing activities:
Change in restricted cash		(2,229		)	—
Purchases of short-term investments		(1,998		)	—
Purchases of property and equipment		—			(68		)
Net cash used in investing activities		(4,227		)	(68		)
Cash flows from financing activities:
Proceeds from issuance of common stock through stock plans		22			306
Net cash provided by financing activities		22			306
Net increase (decrease) in cash and cash equivalents		(5,179		)	1,384
Cash and cash equivalents, beginning of period		9,238			10,777
Cash and cash equivalents, end of period		$	4,059		$	12,161

See accompanying notes.

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INSWEB CORPORATION

(unaudited)

1. Business of InsWeb

InsWeb operates an online insurance marketplace that electronically matches consumers and providers of automobile, homeowners and term life insurance. InsWeb has combined knowledge of the insurance industry, technological expertise and close relationships with insurance companies, agents and other providers to develop an integrated online marketplace. InsWeb’s marketplace enables consumers to research insurance-related topics, search for, analyze and compare insurance products, and apply for and receive quotes for coverage for automobile, homeowners and term life insurance. Management believes that InsWeb provides insurance providers with pre-qualified consumers at attractive acquisition costs, with the scalable, cost-efficient distribution capabilities of InsWeb’s Internet-based model.

InsWeb is subject to all of the risks inherent in the electronic commerce industry and special risks related to the online insurance industry. These risks include, but are not limited to, uncertain economic conditions which could result in lower growth rates, the changing nature of the electronic commerce industry, variations in the availability and cost of acquiring consumer traffic, unpredictability of future revenues, reliance on key customers —insurance carriers, agents and other providers – who are themselves subject to volatility in their operating cycles, and reliance on a third party intermediaries who provide leads to local insurance agents on InsWeb’s behalf. These risks and uncertainties, among others, could cause InsWeb’s actual results to differ materially from historical results or those currently anticipated. In light of InsWeb’s ongoing modifications to its business model to better capitalize on its position as a leading insurance portal, InsWeb believes that period-to-period comparisons of its operating results are not necessarily meaningful and should not be relied upon as an indication of future performance. Moreover, there is no assurance that InsWeb will be able to attain or sustain profitability.

2. Basis of Presentation

The condensed consolidated financial statements include the accounts of InsWeb Corporation and its wholly-owned subsidiaries, InsWeb Insurance Services, Inc. and Goldrush Insurance Services, Inc. (“InsWeb” or the “Company”). All significant inter-company accounts and transactions have been eliminated in the consolidated financial statements.

The accompanying unaudited interim financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not contain all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly InsWeb’s financial position as of March 31, 2009 and the results of operations and cash flows for the three months ended March 31, 2009 and 2008. The financial data and other information disclosed in these notes to the condensed consolidated financial statements related to these periods are unaudited. The results for the three months ended March 31, 2009 are not necessarily indicative of the results to be expected for any future period.

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in InsWeb’s Annual Report on Form 10-K and other information as filed with the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations. The December 31, 2008 condensed consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. The Company believes the disclosures in its notes to the condensed consolidated financial statements are adequate to make the information presented not misleading.

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INSWEB CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

None.

ITEM 4T.

CONTROLS AND PROCEDURES

(a)

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.

(b)

There has been no change in our internal control over financial reporting during the three months ended March 31, 2009 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II:

OTHER INFORMATION

See Part I, Item 1, “Financial Statements — Note 12 — Commitments and Contingencies.”

ITEM 1A.

RISK FACTORS.

Our future business, operating results and financial condition are subject to various risks and uncertainties, including those disclosed in Part I, Item 1A, “Risk Factors,” of our Annual Report on Form 10-K for the year ended December 31, 2008, as filed with the U.S. Securities and Exchange Commission. There have been no material changes to the risk factors as so disclosed.

Exhibit Number		Description of Document
31.1		Certification of Chief Executive Officer, pursuant to Exchange Act Rule 13a-14(a).
31.2		Certification of Chief Financial Officer, pursuant to Exchange Act Rule 13a-14(a).
32		Certification of Chief Executive Officer and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350.

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In accordance with the requirements of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: May 12, 2009	INSWEB CORPORATION
	(Registrant)
	/s/ STEVEN J. YASUDA
	Steven J. Yasuda
	Chief Accounting Officer

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EXHIBIT 31.1

INSWEB CORPORATION

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Hussein A. Enan, Chairman and Chief Executive Officer of InsWeb Corporation, certify that:

(1)

I have reviewed this quarterly report on Form 10-Q of InsWeb Corporation;

(2)

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3)

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4)

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e), for the registrant and we have:

a.

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c.

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

(5)

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

a.

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	/s/ HUSSEIN A. ENAN
Dated: May12, 2009	Hussein A. Enan
	Chairman and Chief Executive Officer

 

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EXHIBIT 31.2

INSWEB CORPORATION

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Kiran Rasaretnam, Chief Financial Officer of InsWeb Corporation, certify that:

(1)

I have reviewed this quarterly report on Form 10-Q of InsWeb Corporation;

(2)

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3)

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4)

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e), for the registrant and we have:

a.

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c.

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

(5)

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

a.

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	/s/ KIRAN RASARETNAM
Dated: May12, 2009	Kiran Rasaretnam
	Chief Financial Officer

 

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EXHIBIT 32

INSWEB CORPORATION

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of InsWeb Corporation (the “Company”) on Form 10-Q for the quarter ended March 31, 2009 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to InsWeb Corporation, and will be retained by InsWeb Corporation and furnished to the Securities Exchange Commission or its staff upon request.

/s/ HUSSEIN A. ENAN
Hussein A. Enan
Chairman and Chief Executive Officer
Dated: May 12, 2009
/s/ KIRAN RASARETNAM
Kiran Rasaretnam
Chief Financial Officer
Dated : May 12, 2009