The Aon Benfield Aggregatethoughtleadership.aonbenfield.com/ThoughtLeadership/Documents/… · Ariel USD 1,545 0 0% 349 23% 349 Aspen USD 3,241 2 0% 33 1% 34 Axis USD 5,625 15 0%

The Aon Benfield AggregateSix Months Ended June 30, 2011

ContentsGlobal Reinsurer Capital 3

Executive Summary 4

Aon Benfield Aggregate Capital 5

Capital Development 5Capital Management 7

Premium Income 8Premium Distribution 9

Earnings 10Underwriting Performance 10Investment Results 12Return on Equity 13

Ratings 15

Appendix 1: Aon Benfield Aggregate Data 16

About Aon BenfieldAon Benfield, a division of Aon Corporation (NYSE: AON), is the world’s leading reinsurance intermediary and full-service capital advisor. We empower

our clients to better understand, manage and transfer risk through innovative solutions and personalized access to all forms of global reinsurance capital

across treaty, facultative and capital markets. As a trusted advocate, we deliver local reach to the world’s markets, an unparalleled investment in innovative

analytics, including catastrophe management, actuarial and rating agency advisory. Through our professionals’ expertise and experience, we advise clients in

making optimal capital choices that will empower results and improve operational effectiveness for their business. With more than 80 offices in 50 countries,

our worldwide client base has access to the broadest portfolio of integrated capital solutions and services. To learn how Aon Benfield helps empower results,

please visit aonbenfield.com.

Aon Benfield

3

Global Reinsurer Capital Aon Benfield estimates that global reinsurer capital totaled USD445 billion at June

30, 2011, an increase of 1% from March 31, 2011, but a reduction of 5% from the

end of 2010. This calculation is a broad measure of capital available for reinsurance

and includes both traditional and non-traditional forms of reinsurance capital.

Exhibit 1: Global Reinsurer Capital

Source: Company reports, Aon Benfield Analytics

411

342

402

470445

300

400

500

FY 2007 FY 2008 FY 2009 FY 2010 1H 2011

USD

(bill

ions

)

-17%18%

17%

-5%

The Aon Benfield Aggregate – Six Months Ended June 30, 2011

4

Executive Summary Global reinsurer capital totaled USD445 billion at June 30, 2011, a reduction of 5% from USD470 billion at December 31, 2010. Growth of 1% was observed in the second quarter, after a reduction of 6% in the first.

At June 30, 2011, the reported shareholders’ funds of the 28 companies forming the ABA totaled USD242 billion, a reduction of 1.7% or USD4.2 billion since the end of 2010. Half of the capital lost in the first quarter was recovered in the second.

The ABA reported net income of USD1.2 billion for the first half of 2011, a gain of USD5.4 billion in the second quarter more than offsetting a loss of USD4.2 billion in the first.

As well as the contribution from net income, ABA capital benefitted from USD0.8 billion of new issuance and USD2.4 billion of foreign exchange gains. However, these positive factors were more than offset by USD9.6 billion of dividends and share buybacks.

Gross property and casualty (P&C) premiums written by the ABA totaled USD74.4 billion in the first half of 2011, an increase of 10.5%. A number of the larger constituents reported appreciable underlying growth but acquisitions and reinstatement premiums also contributed to the gain.

The ABA combined ratio increased from 99.7% to 120.6%, driven by a USD12.8 billion increase in net catastrophe losses to USD18.2 billion.

The total investment return fell by 12% to USD18.5 billion, due to the continued effect of low interest rates and a marked reduction in realized and unrealized losses.

Overall, the ABA reported a pre-tax profit of USD0.8 billion for the first half of 2011, a 95% reduction relative to the comparative period in 2010.

Despite the elevated level of catastrophe losses over the last 18 months, financial strength ratings have remained broadly unchanged, reflecting continued robust capital positions.

Aon Benfield

5

Aon Benfield Aggregate Capital At June 30, 2011 the reported shareholders’ funds of the 28 reinsurers forming the

ABA totaled USD242.4 billion. This represented a decline of 1.7% or USD4.2 billion

from the end of 2010, with half of the reduction in the first quarter being recovered

in the second quarter.

Exhibit 2: ABA Shareholders’ Funds

Source: Company reports, Aon Benfield Market Analysis

Capital Development Dividends totaling USD7.1 billion and share buybacks totaling USD2.5 billion were the main drivers of the overall reduction in capital in the first half of 2011. Net income across the ABA totaled USD1.2 billion, despite USD18.2 billion of net catastrophe losses. Other positive contributors were USD0.8 billion of new capital (mainly preferred shares issued by Endurance, Montpelier Re and PartnerRe) and USD2.4 billion of foreign exchange gains.

Exhibit 3: ABA Shareholders’ Funds Development


-2%

100

150

200

250

FY 2007 FY 2008 FY 2009 FY 2010 1H 2011

USD

(b

illio

ns) -19% 28%

18%

246.6 0.81.2 -7.1

2.4 0.2 -2.50.7 242.4

230

240

250

FY 2010SHF

Additionalcapital

Netincome

Dividends FX Investmentgains

Sharebuybacks

Other 1H 2011SHF

USD

(bill

ions

)


6

Among the ABA constituents, only ACE reported capital growth of any note in the first half of 2011. Most reported a decline, driven by the impact of catastrophe losses on earnings, as well as dividend payments and share buybacks. Capital management was particularly active at Ariel and Endurance, as shown in Exhibit 6.

Exhibit 4: Movement in Reported Shareholders’ Funds


The chart below plots the reported losses from catastrophe events in the first half of 2011 (mainly pre-tax and net of reinsurance and reinstatement premiums) against shareholders’ funds held at the end of 2010.

Exhibit 5: Catastrophe Losses as % of 2010 Shareholders’ Funds


-25%

-20%

-15%

-10%

-5%

0%

5%

10%ABA

27%

17% 17%16% 15% 14% 14%

12% 12% 12% 11% 10% 9% 9% 9% 8%7% 6% 6% 6% 5%

4% 4%2% 2% 1%

0%

5%

10%

15%

20%

25%

30% Australian events

New Zealand earthquake II

Japan earthquake

2Q movement in 1Q losses

2Q catastrophes (primarily US tornadoes)

Aon Benfield

7

Capital Management The ABA companies returned USD9.6 billion, or 3.9% of opening capital, to investors in the first half of 2011 in the form of dividends and share buybacks. This compares with USD9.1 billion, or 4.4%, in the first half of 2010. Dividends were boosted by a USD2 billion payout from Burlington Northern Santa Fe Railway, which was up-streamed to Berkshire Hathaway via National Indemnity. Share buybacks halved, with activity heavily curtailed in the wake of the first quarter earthquakes.

Exhibit 6: Capital Management

Company

Reporting

Currency

(millions)

Opening

SHF

(FY 2010)

1H 2011

Buybacks

Buybacks

as % of

Opening

SHF

Dividends

paid

1H 2011

Dividends

as % of

Opening

SHF

Total

Capital

Returned

ACE USD 22,974 0 0% 113 0% 113

Allied World USD 3,076 114 4% 0 0% 114

Alterra USD 2,918 144 5% 25 1% 169

American Agricultural USD 494 0 0% 1 0% 1

Arch USD 4,513 274 6% 13 0% 287

Argo USD 1,626 21 1% 7 0% 28

Ariel USD 1,545 0 0% 349 23% 349

Aspen USD 3,241 2 0% 33 1% 34

Axis USD 5,625 15 0% 80 1% 95

Endurance USD 2,848 341 12% 32 1% 373

Everest Re USD 6,284 38 1% 52 1% 90

Fairfax USD 8,633 21 0% 232 3% 254

Flagstone USD 1,135 0 0% 0 0% 0

Gen Re USD 9,319 0 0% 550 6% 550

Hannover Re EUR 4,509 0 0% 277 6% 277

Maiden USD 750 0 0% 10 1% 10

Montpelier Re USD 1,629 63 4% 15 1% 77

Munich Re EUR 22,783 323 1% 1,110 5% 1,433

National Indemnity USD 68,437 0 0% 2,000 3% 2,000

PartnerRe USD 7,207 227 3% 95 1% 322

Platinum USD 1,895 82 4% 6 0% 88

RenaissanceRe USD 3,936 175 4% 44 1% 220

SCOR EUR 4,345 0 0% 201 5% 201

Swiss Re USD 25,342 209 1% 1,035 4% 1,244

Transatlantic USD 4,284 0 0% 26 1% 26

Validus USD 3,505 6 0% 55 2% 61

White Mountains USD 3,653 93 3% 8 0% 101

XL USD 9,611 259 3% 69 1% 327

ABA USD 246,634 2,535 1% 7,081 3% 9,616



8

Premium Income Gross property and casualty (P&C) premiums written by the ABA in the first half of

2011 totaled USD74.4 billion, an increase of 10.5% relative to the same period in

2010. In addition to acquisitions and reinstatement premiums, appreciable

underlying growth was reported at a number of the larger ABA constituents.

Exhibit 7: ABA Gross Premiums Written


The ten largest ABA constituents expanded gross written premiums by 13% in the period, while the remainder grew by 4%. On a constant currency basis, Munich Re, Swiss Re and Hannover Re experienced growth rates of 13%, 16% and 10%, respectively, driven largely by solvency-relief deals in Asia and increased demand for natural catastrophe cover in loss-affected areas. Acquisitions influenced premium development at Alterra (Harbor Point), Maiden (GMAC International) and Fairfax (Zenith National/First Mercury).

Exhibit 8: P&C Gross Premiums Written, Percentage Change


-6.3% 10.5%

20

30

40

50

60

70

80

1H 2009 1H 2010 1H 2011

USD

(bill

ions

)

-30%-20%-10%

0%10%20%30%40%50%60%

ABA

Aon Benfield

9

Premium Distribution Net P&C premiums written increased by 12.0% to USD62.7 billion in the first half. The companies represented in the top ten remained unchanged, with their share of the total increasing from 71.9% to 73.9%. XL and National Indemnity swapped places, while Fairfax, SCOR and Axis rose above PartnerRe.

Exhibit 9: Distribution of P&C Net Premiums Written


1H 2011 P&C Net Premiums WrittenUSD 62.7 billion

Munich Re 17.9%

Swiss Re 12.9%

ACE 10.4%

Hannover Re 7.1%

NICO 5.3%

XL 4.8%

Fairfax 4.6%

SCOR 3.9%

Axis 3.6%

PartnerRe 3.4%

Remainder 26.1%


10

Earnings The ABA reported pre-tax profits of USD0.8 billion for the first half of 2011, down

95% over the comparative period in 2010. Net catastrophe losses totaled USD18.2

billion, driving the overall underwriting result to a deficit of USD11.0 billion. The

total investment return fell by 12%, primarily reflecting lower levels of capital gains.

Exhibit 10: ABA Pre-Tax Result


The distribution of the pre-tax result across the ABA constituents is shown in Exhibit 11. The gains at National Indemnity and Gen Re were largely driven by dividend payments from subsidiaries. Most companies reported losses, the largest in dollar terms being incurred by Munich Re and PartnerRe.

Exhibit 11: Pre-Tax Profit/Loss (USD millions)


Underwriting Performance The ABA reported a combined ratio of 120.6% for the first half of 2011, up from 99.7% in the prior year. The deterioration was driven by an increase in the level of catastrophe losses from USD5.4 billion to USD18.2 billion. Attritional claims showed a marked improvement. In the aggregate, prior year reserve releases continue to provide significant, albeit weakening, support to reported results.

14.7

0.8

-20-15-10-505

10152025

1H 2010 1H 2011

USD

(bill

ions

)

Other Capital gains/losses Life underwriting resultNon-life underwriting result Investment income Pre-tax profit

-1,000

-600

-200

200

600

1,000

1,400

1,800

Aon Benfield

11

Exhibit 12: ABA Combined Ratio Composition


The combined ratios of the ABA constituents are shown in Exhibit 13. All but two companies reported underwriting losses for the first half of 2011.

Exhibit 13: Reported Combined Ratios


The impact of catastrophe losses on reported combined ratios in the first half of 2011 is shown in Exhibit 14. The results range from 126.6% in the case of specialist underwriter RenRe, to 1.3% in the case of Maiden Holdings.

Exhibit 14: Combined Ratio Impact of Catastrophe Losses


64.1% 61.4%

10.9%34.1%

29.7%

29.9%

-5.0% -4.8%

99.7%

120.6%

-10%

40%

90%

140%

1H 2010 1H 2011

Attritional loss ratio Catastrophe losses Expense ratio Prior year reserve adjustment

0%20%40%60%80%

100%120%140%160%180% Loss ratio Expense ratio ABA combined ratio

127%

92%81%

76%68%

47% 44% 43% 43% 41% 40% 36% 35% 32% 29% 29% 27% 25% 21% 21% 19% 18% 18% 18%9%

1%0%

20%

40%

60%

80%

100%

120%

140%Australian events

New Zealand earthquake II

Japan earthquake

2Q movement in 1Q losses

2Q catastrophes (primarily US tornadoes)


12

In dollar terms, prior year reserve releases increased marginally to USD2.6bn in the first half of 2011, although this result was heavily influenced by a USD0.5bn contribution from Swiss Re. Numerous short-tail underwriters continue to derive significant earnings benefit from this source.

Exhibit 15: Loss Reserve Adjustment as % of Net Premium Earned


Investment Results ABA invested assets increased by 4.9% to USD929 billion during the first half of 2011. Overall asset allocation was broadly unchanged.

Exhibit 16: Invested Assets Portfolio


The total investment return fell by 12% to USD18.5 billion, equating to a yield of 2.0%, down from 2.5% in the first half of 2010. Net investment income rose by 13% to USD17.3 billion. Realized and unrealized capital gains reported through income statements fell by 80% to USD1.2 billion.

-5%

0%

5%

10%

15%

20%

25%

30%ABA

63%12%

5%

20%

ABA Invested Assets December 31, 2010 USD885 billion

Fixed income securities Equities Cash Other

62%12%

6%

20%

ABA Invested Assets June 30, 2011 USD929 billion

Aon Benfield

13

Exhibit 17: Total Investment Return


In view of the planned participation of private creditors in a second rescue package for Greece, Munich Re wrote down its holdings in Greek government debt to market value at June 30, 2011. This generated costs of EUR703 million and a burden of EUR125 million on the consolidated result. These securities are mainly held at ERGO, the group’s primary insurance operation, with much of the investment risk passed to policyholders. The other ABA companies have very little direct exposure to sovereign debt issued by peripheral European Union countries.

Exhibit 18: Reinsurer Exposure at June 30, 2011

Company

Reporting Currency

(millions) Portugal Italy Ireland Greece Spain Total

As % of

SHF

Hannover Re EUR 30 27 31 0 166 254 5.9%

Munich Re EUR 768 5,377 1,536 768 2,305 10,754 53.6%

SCOR EUR 0 0 0 0 0 0 0.0%

Swiss Re USD 33 4 6 0 35 78 0.3%


Return on Equity Quarterly net income for the ABA from the beginning of 2010 is shown in Exhibit 19. The result returned to a more normal level in the second quarter of 2011, after the heavy impact of catastrophe events earlier in the year.

Exhibit 19: ABA Net Income


0%

1%

2%

3%

4%

5%

6%

7%ABA

5.4 6.5 6.94.6

-4.2

5.4

-5

-3

-1

1

3

5

7

9

1Q 2010 2Q 2010 3Q 2010 4Q 2010 1Q 2011 2Q 2011

USD

(bill

ions

)


14

The net results reported by the ABA companies for the first half of 2011 are shown in Exhibit 20. Munich Re benefitted from a significant tax recovery, leaving PartnerRe as an outlier.

Exhibit 20: Net Income / Loss (USD millions)


The ABA reported a return on equity1 of 0.5% for the first half of 2011, a reduction from 5.4% in the prior year period. The distribution across the ABA constituents is shown in Exhibit 21.

Exhibit 21: Return on Average Common Equity (Net Income)


1 Return on equity is calculated as net income available to common shareholders as a percentage of the average of common equity at December 31, 2010 and June 30, 2011.

-1,000

-500

0

500

1,000

1,500

2,000

-20%

-15%

-10%

-5%

0%

5%

10%ABA

Aon Benfield

15

Ratings Exhibit 22: Ratings

Main Operating Company A.M. Best Fitch Moody’s Standard & Poor’s

ACE Bermuda Insurance Ltd A+* Stable AA-* Stable Aa3 Stable AA- Stable

Allied World Assurance Co Ltd A Stable NR - A2 Review ( ) A Watch Pos

Alterra Bermuda Ltd A Negative A* Stable A3 Stable A- Positive

American Agricultural Insurance Co A- Stable NR - NR - -

Arch Reinsurance Ltd A Positive A+ Stable A2 Positive A+ Stable

Argo Re Ltd A* Stable NR - NR - NR -

Ariel Reinsurance Company Ltd A-* Stable NR - NR - A- Stable

Aspen Insurance Ltd A Stable NR - A2 Stable A Stable

AXIS Specialty Ltd A Stable A+ Stable A2 Stable A+ Stable

Endurance Specialty Insurance Ltd A Stable A* Stable A2 Stable A Stable

Everest Reinsurance (Bermuda) Ltd A+* Stable AA-* Stable Aa3* Stable A+* Stable

Flagstone Reassurance Suisse SA A-* Negative A-* Negative A3 Review ( ) NR -

General Reinsurance Corporation A++* Stable AA+* Stable Aa1 Stable AA+ Negative

Hannover Rückversicherungs AG A Positive A+* Stable NR - AA-* Stable

Maiden Insurance Company Ltd A-* Stable NR - NR - BBB+ Stable

Montpelier Reinsurance Ltd A-* Positive A-* Positive NR - A- Stable

Munich Reinsurance Co A+ Stable AA-* Stable Aa3* Stable AA- Stable

National Indemnity Company A++* Stable AA+* Stable Aa1 Stable AA+ Negative

Odyssey Reinsurance Company A Stable A-* Stable A3 Positive A- Stable

Partner Reinsurance Co Ltd A+* Stable AA- Stable Aa3* Negative AA-* Negative

Platinum Underwriters Bermuda Ltd A* Stable A* Stable NR - A* Negative

Renaissance Reinsurance Ltd A+* Stable A+* Stable A1 Stable AA-* Stable

SCOR Global P&C SE A* Stable A* Positive A2 Positive A* Positive

Sirius International Insurance Corp A Stable A- Stable A3 Stable A- Stable

Swiss Reinsurance Co A Positive NR - A1* Stable A+ Positive

Transatlantic Reinsurance Co A Stable NR - A1* Stable A+ Stable

Validus Reinsurance Ltd A- Positive A- Stable A3 Stable A- Stable

XL Re Ltd A Stable A* Stable A2 Stable A Stable

* Ratings affirmed since Japan EQ

Rating/outlook changes since Japan EQ

Ratings as at August 2011

Source: A.M. Best, Fitch, Moody’s, Standard & Poor’s


16

Appendix 1: Aon Benfield Aggregate Data Exhibit 23: 1H 2011 Results

Company

Reporting

Currency

(millions)

P&C Gross

Premiums

Written

1H 2010

P&C Gross

Premiums

Written

1H 2011 Change

P&C Net

Premiums

Written

1H 2010

P&C Net

Premiums

Written

1H 2011 Change

ACE USD 9,156 9,177 0% 6,215 6,531 5%

Allied World USD 998 1,080 8% 803 877 9%

Alterra USD 768 1,190 55% 536 917 71%

American Agricultural USD 449 512 14% 149 142 -5%

Arch USD 1,771 1,877 6% 1,392 1,471 6%

Argo USD 840 755 -10% 601 511 -11%

Ariel USD 479 437 -9% 409 390 -5%

Aspen USD 1,248 1,254 0% 1,119 1,035 -7%

Axis USD 2,365 2,595 10% 2,033 2,251 11%

Endurance USD 1,308 1,503 15% 1,154 1,241 8%

Everest Re USD 2,035 2,053 1% 1,918 1,975 3%

Fairfax USD 2,659 3,427 29% 2,197 2,889 32%

Flagstone USD 770 769 0% 618 546 -12%

Gen Re USD 619 519 -16% 312 262 -16%

Hannover Re EUR 3,272 3,544 8% 2,948 3,190 8%

Maiden USD 662 933 41% 624 886 42%

Montpelier Re USD 474 471 -1% 458 421 -8%

Munich Re* EUR 7,480 8,281 11% 6,968 8,007 15%

National Indemnity USD 2,839 3,686 30% 2,584 3,351 30%

PartnerRe USD 2,692 2,231 -17% 2,546 2,119 -17%

Platinum USD 415 355 -14% 399 321 -20%

RenaissanceRe USD 1,023 1,252 22% 736 881 20%

SCOR EUR 1,764 1,944 10% 1,622 1,743 7%

Swiss Re USD 8,562 10,265 20% 6,615 8,100 22%

Transatlantic USD 2,096 2,157 3% 1,974 2,040 3%

Validus USD 1,388 1,455 5% 1,229 1,213 -1%

White Mountains USD 1,687 1,287 -24% 1,264 1,112 -12%

XL USD 3,429 3,862 13% 2,711 3,020 11%

ABA USD 67,392 74,443 10.5% 55,953 62,679 12.0%

*P&C reinsurance segment only


Aon Benfield

17

Exhibit 23: 1H 2011 Results (cont’d)

Calendar Year

Company

Loss

Ratio

1H 2010

Loss

Ratio

1H 2011

Expense

Ratio

1H 2010

Expense

Ratio

1H 2011

Combined

Ratio

1H 2010

Combined

Ratio

1H 2011 Change

ACE 60.3% 67.8% 30.9% 30.6% 91.2% 98.4% 7.2pp

Allied World 62.1% 78.3% 31.0% 31.3% 93.1% 109.6% 16.5pp

Alterra 58.6% 70.9% 27.6% 32.7% 86.2% 103.5% 17.4pp

American Agricultural 83.2% 134.0% 16.5% 14.8% 99.7% 148.8% 49.1pp

Arch 61.2% 72.5% 32.2% 32.3% 93.4% 104.8% 11.4pp

Argo 66.0% 87.3% 37.8% 39.3% 103.8% 126.6% 22.8pp

Ariel 62.0% 64.6% 36.7% 38.0% 98.7% 102.6% 3.9pp

Aspen 69.2% 93.8% 29.2% 32.8% 98.4% 126.6% 28.2pp

Axis 60.9% 97.3% 31.2% 31.8% 92.1% 129.1% 37.0pp

Endurance 64.0% 87.9% 29.9% 30.5% 93.8% 118.4% 24.6pp

Everest Re 80.9% 96.8% 27.6% 27.5% 108.5% 124.3% 15.8pp

Fairfax 75.4% 82.8% 29.8% 31.5% 105.2% 114.2% 9.1pp

Flagstone 62.2% 110.2% 38.4% 34.4% 100.6% 144.6% 44.0pp

Gen Re 56.3% 100.3% 40.0% 18.8% 96.2% 119.1% 22.9pp

Hannover Re 74.3% 85.4% 25.3% 24.9% 99.5% 110.3% 10.8pp

Maiden 63.1% 65.4% 33.6% 33.0% 96.7% 98.4% 1.7pp

Montpelier Re 61.2% 110.8% 31.5% 31.6% 92.7% 142.3% 49.6pp

Munich Re* 76.8% 103.5% 29.6% 29.6% 106.4% 133.1% 26.7pp

National Indemnity 56.1% 108.7% 31.0% 32.7% 87.2% 141.4% 54.2pp

PartnerRe 73.9% 118.0% 29.9% 29.1% 103.8% 147.1% 43.3pp

Platinum 57.3% 134.8% 26.9% 26.3% 84.2% 161.1% 76.9pp

RenaissanceRe 17.0% 149.2% 28.8% 24.9% 45.8% 174.1% 128.4pp

SCOR 74.5% 84.4% 27.9% 28.7% 102.5% 113.1% 10.7pp

Swiss Re 78.1% 90.4% 27.8% 28.9% 105.9% 119.4% 13.5pp

Transatlantic 73.1% 96.8% 28.7% 26.9% 101.8% 123.7% 21.9pp

Validus 75.2% 79.9% 30.1% 33.3% 105.3% 113.2% 7.9pp

White Mountains 72.5% 67.7% 34.3% 35.5% 106.8% 103.2% -3.6pp

XL 66.1% 78.8% 30.3% 31.3% 96.4% 110.1% 13.7pp

ABA 70.0% 90.7% 29.7% 29.9% 99.7% 120.6% 20.9pp




18


Accident Year

Company

Prior Year

Reserve

Adjustment

1H 2010

Prior Year

Reserve

Adjustment

1H 2011

Prior Year

Reserve

Adjustment

as % of NPE

1H 2010

Prior Year

Reserve

Adjustment

as % of NPE

1H 2011

Accident

Year

Combined

Ratio

1H 2010

Accident

Year

Combined

Ratio

1H 2011 Change

ACE -245 -239 4.3% 3.8% 95.4% 102.2% 6.8pp

Allied World -138 -100 20.4% 14.4% 113.5% 124.0% 10.5pp

Alterra -41 -79 8.5% 10.8% 94.7% 114.4% 19.7pp

American Agricultural -18 -15 10.0% 9.5% 109.7% 158.3% 48.6pp

Arch -70 -117 5.4% 9.2% 98.8% 113.9% 15.2pp

Argo -20 4 3.1% -0.7% 107.0% 125.9% 18.9pp

Ariel -9 -30 3.1% 11.3% 101.8% 113.9% 12.1pp

Aspen -15 -55 1.6% 6.0% 99.9% 132.5% 32.6pp

Axis -160 -101 11.2% 6.2% 103.3% 135.4% 32.1pp

Endurance -68 -93 8.3% 10.8% 102.1% 129.1% 27.0pp

Everest Re -20 -3 1.1% 0.1% 109.6% 124.5% 14.9pp

Fairfax -51 -64 2.3% 2.4% 107.5% 116.7% 9.2pp

Flagstone -21 -4 4.6% 0.8% 105.2% 145.5% 40.3pp

Gen Re -70 -78 21.8% 28.3% 118.0% 147.4% 29.4pp

Hannover Re -140 -165 5.3% 5.8% 104.8% 116.1% 11.3pp

Maiden 0 0 0.0% 0.0% 96.7% 98.4% 1.7pp

Montpelier Re -64 -53 20.7% 16.7% 113.4% 159.1% 45.6pp

Munich Re* 0 0 0.0% 0.0% 106.4% 133.1% 26.7pp

National Indemnity -491 -39 22.7% 1.6% 109.8% 142.9% 33.1pp

PartnerRe -214 -303 11.1% 17.0% 114.9% 164.1% 49.1pp

Platinum -90 -49 21.8% 13.9% 106.0% 175.0% 69.0pp

RenaissanceRe -193 -89 41.6% 17.0% 87.3% 191.1% 103.8pp

SCOR 0 -23 0.0% 1.4% 102.5% 114.5% 12.1pp

Swiss Re 0 -492 0.0% 9.3% 105.9% 128.7% 22.8pp

Transatlantic -22 -28 1.1% 1.4% 103.0% 125.2% 22.2pp

Validus -76 -52 8.5% 6.1% 113.8% 119.3% 5.5pp

White Mountains -38 -28 2.9% 2.8% 109.7% 106.0% -3.7pp

XL -169 -199 6.8% 7.7% 103.3% 117.8% 14.6pp

ABA -2,483 -2,570 5.0% 4.8% 104.7% 125.4% 20.7pp


Figures in reporting currencies, but converted to USD (millions) for ABA line


Aon Benfield

19


Company

Net

Investment

Income

1H 2010

Net

Investment

Income

1H 2011

Capital

Gains/

Losses

1H 2010

Capital

Gains/

Losses

1H 2011

Total

Investment

Return

1H 2010

Total

Investment

Return

1H 2011 Change

ACE 1,022 1,113 177 -118 1,199 995 -17%

Allied World 134 103 172 109 307 212 -31%

Alterra 102 117 -9 -26 93 91 -1%

American Agricultural 9 8 1 3 9 11 18%

Arch 184 175 133 97 316 272 -14%

Argo 67 66 20 34 86 100 16%

Ariel 33 24 27 4 60 29 -53%

Aspen 117 114 18 -7 135 107 -21%

Axis 187 211 41 68 228 278 22%

Endurance 90 92 4 3 94 95 1%

Everest Re 327 337 12 11 339 349 3%

Fairfax 377 378 569 18 946 396 -58%

Flagstone 16 23 -3 3 13 26 103%

Gen Re 640 767 2 5 642 772 20%

Hannover Re 565 577 -14 96 551 673 22%

Maiden 36 39 1 1 37 40 6%

Montpelier Re 39 35 30 29 69 64 -7%

Munich Re 3,727 3,634 1,351 -166 5,078 3,468 -32%

National Indemnity 1,491 3,136 2,032 230 3,523 3,365 -4%

PartnerRe 348 310 191 -34 539 276 -49%

Platinum 73 66 31 -8 104 58 -44%

RenaissanceRe 92 94 117 30 209 123 -41%

SCOR 284 269 60 76 344 345 0%

Swiss Re 2,839 2,919 363 643 3,202 3,562 11%

Transatlantic 228 226 6 53 235 280 19%

Validus 69 56 81 24 150 80 -47%

White Mountains 109 95 93 77 202 172 -15%

XL 589 551 -138 -83 451 468 4%

ABA 15,308 17,349 5,831 1,173 21,138 18,522 -12%




20


Company

Pre-tax

Profit/Loss

1H 2010

Pre-tax

Profit/Loss

1H 2011 Change

Pre-tax

Operating ROE*

1H 2010

Pre-tax

Operating ROE*

1H 2011 Change

ACE 1,698 1,085 -36% 7.4% 5.1% -2.3pp

Allied World 332 116 -65% 4.8% 0.2% -4.6pp

Alterra 144 -21 -115% 6.8% 0.2% -6.7pp

American Agricultural 8 -67 -990% 1.4% -15.0% -16.3pp

Arch 469 122 -74% 7.7% 0.6% -7.2pp

Argo 66 -65 -199% 2.8% -6.2% -9.1pp

Ariel 66 40 -40% 2.4% 2.6% 0.1pp

Aspen 141 -157 -211% 3.7% -4.7% -8.4pp

Axis 353 -260 -174% 5.7% -6.0% -11.7pp

Endurance 115 -66 -158% 3.9% -2.5% -6.4pp

Everest Re 151 -201 233% 2.3% -3.4% -5.7pp

Fairfax 586 -328 -156% 0.2% -4.1% -4.3pp

Flagstone 38 -185 -587% 3.1% -17.4% -20.5pp

Gen Re 654 715 9% 6.7% 7.7% 0.9pp

Hannover Re 452 197 -56% 10.3% 2.0% -8.3pp

Maiden 33 -3 -110% 4.6% -0.5% -5.1pp

Montpelier Re 79 -82 -203% 2.9% -6.8% -9.8pp

Munich Re 1,639 -680 -141% 1.3% -2.4% -3.6pp

National Indemnity 3,796 1,630 -57% 3.5% 2.1% -1.5pp

PartnerRe 312 -659 -311% 1.6% -9.0% -10.7pp

Platinum 148 -177 -220% 5.6% -9.4% -15.0pp

RenaissanceRe 455 -271 -160% 7.4% -6.8% -14.2pp

SCOR 158 21 -87% 2.4% -1.3% -3.7pp

Swiss Re 1,463 556 -62% 4.5% -0.3% -4.8pp

Transatlantic 150 -226 -251% 3.5% -6.6% -10.1pp

Validus 65 -63 198% -0.4% -2.5% -2.0pp

White Mountains -20 0 99% -2.7% -1.8% 0.9pp

XL 412 26 -117% 5.5% 0.1% -5.4pp

ABA 14,747 809 -95% 4.0% -0.1% -4.1pp

*Calculated by excluding the impact of net realized and unrealized investment gains/losses



Aon Benfield

21


Company

Net Income

1H 2010

Net Income

1H 2011 Change

Return on

Equity*

1H 2010

Return on

Equity*

1H 2011 Change

ACE 1,432 866 -40% 7.0% 3.7% -3.3pp

Allied World 318 102 -68% 9.5% 3.3% -6.2pp

Alterra 140 -14 -110% 6.2% -0.5% -6.7pp

American Agricultural 8 -65 -870% 1.6% -14.9% -16.5pp

Arch 448 111 -75% 10.7% 2.7% -8.0pp

Argo 47 -72 -253% 2.9% -4.5% -7.4pp

Ariel 61 36 -41% 3.9% 2.6% -1.3pp

Aspen 116 -153 -232% 3.7% -5.4% -9.1pp

Axis 317 -283 -189% 6.3% -5.7% -12.0pp

Endurance 107 -55 -152% 3.8% -2.0% -5.8pp

Everest Re 134 -185 -238% 2.2% -3.0% -5.2pp

Fairfax 432 -184 -142% 5.9% -2.4% -8.3pp

Flagstone 45 -181 -505% 3.7% -17.4% -21.2pp

Gen Re 539 664 23% 5.6% 7.2% 1.6pp

Hannover Re 310 218 -30% 7.8% 4.9% -2.9pp

Maiden 32 -5 -116% 4.6% -0.7% -5.3pp

Montpelier Re 80 -83 -205% 4.8% -5.4% -10.1pp

Munich Re 1,191 -211 -118% 5.2% -1.0% -6.2pp

National Indemnity 3,264 1,554 -52% 6.6% 2.3% -4.3pp

PartnerRe 253 -700 -377% 3.6% -10.5% -14.1pp

Platinum 140 -178 -227% 6.7% -9.9% -16.6pp

RenaissanceRe 375 -223 -159% 11.9% -7.0% -18.9pp

SCOR 156 40 -74% 3.9% 1.0% -2.9pp

Swiss Re 970 295 -70% 4.1% 1.2% -2.9pp

Transatlantic 126 -109 -186% 3.1% -2.6% -5.7pp

Validus 61 -62 -202% 1.6% -1.8% -3.4pp

White Mountains -37 -17 -56% -1.0% -0.5% 0.6pp

XL 320 -2 -101% 3.2% 0.0% -3.2pp

ABA 11,974 1,124 -90.6% 5.4% 0.5% -5.0pp

*Net income available to common shareholders as a percentage of the average of common equity at December 31, 2010 and June 30, 2011.




22


Company

Cash and

Investments

FY 2010

Cash and

Investments

1H 2011 Change

Shareholders’

Funds

FY 2010

Shareholders’

Funds

1H 2011 Change

ACE 54,555 58,506 7% 22,974 24,113 5%

Allied World 8,077 8,350 3% 3,076 3,044 -1%

Alterra 7,937 8,024 1% 2,918 2,793 -4%

American Agricultural 906 819 -10% 494 446 -10%

Arch 12,237 12,577 3% 4,513 4,441 -2%

Argo 4,332 4,381 1% 1,626 1,549 -5%

Ariel 2,252 2,056 -9% 1,545 1,237 -20%

Aspen 7,355 7,545 3% 3,241 3,105 -4%

Axis 12,666 13,382 6% 5,625 5,333 -5%

Endurance 6,280 6,560 4% 2,848 2,670 -6%

Everest Re 15,894 16,332 3% 6,284 6,153 -2%

Fairfax 23,487 24,397 4% 8,633 8,245 -4%

Flagstone 2,039 1,882 -8% 1,135 947 -17%

Gen Re 14,024 13,841 -1% 9,319 9,182 -1%

Hannover Re 38,058 37,526 -1% 4,509 4,325 -4%

Maiden 2,401 2,494 4% 750 759 1%

Montpelier Re 2,808 2,965 6% 1,629 1,620 -1%

Munich Re 184,149 181,405 -1% 22,783 20,058 -12%

National Indemnity 104,826 112,839 8% 68,437 68,163 0%

PartnerRe 19,320 19,971 3% 7,207 6,632 -8%

Platinum 4,328 4,379 1% 1,895 1,696 -11%

RenaissanceRe 6,413 6,069 -5% 3,936 3,515 -11%

SCOR 20,956 19,783 -6% 4,345 4,002 -8%

Swiss Re 184,306 190,841 4% 25,342 24,818 -2%

Transatlantic 13,408 14,005 4% 4,284 4,234 -1%

Validus 5,796 6,206 7% 3,505 3,408 -3%

White Mountains 9,743 8,634 -11% 3,653 3,621 -1%

XL 35,800 36,454 2% 9,611 9,626 0%

ABA 885,164 928,845 5% 246,634 242,411 -1.7%



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