Max Re Q3 Loss $41 Million; $18 Million 9 Month Profit

October 31, 2005

Bermuda-based Max Re Capital Ltd. Came off better than many of its peers in the third quarter. It still posted a net loss of $41 million, or 89 cents per diluted share, compared to a net loss of $9 million, or 20 cents per diluted share, for the same period in 2004. The operating loss was only slightly higher.

For the first 9 months of 2005 Max Re had net income of $18.1 million, or 36 cents per diluted share, compared to $46.6 million, or 96 cents per diluted share, for the nine months ended September 30, 2004. For the nine months ended September 30, 2005, the Company had net operating income of $15.3 million, or 31 cents per diluted share, compared to $42.5 million, or 87 cents per diluted share, for the nine months ended September 30, 2004.

Chairman, President and CEO Robert J. Cooney commented: “Losses from natural catastrophes, principally Hurricane Katrina, during the period had a US$112.0 million negative impact on our third quarter results. We were pleased with our MDS portfolio return for the period which exceeded our quarterly expectation and partially mitigated the natural catastrophe losses. Max Re’s diversification allowed us to produce better results in the third quarter than most of our competitors which, along with our US$246.0 million secondary common share offering in October 2005, leaves us well positioned to participate in the expected attractive market for our products in upcoming months.”

The bulletin noted: Gross premiums written for the three months ended September 30, 2005 were $288 million, of which $196.3 million came from property and casualty underwriting and $91.7 million from life and annuity underwriting, compared to $280.8 million, $105.8 million coming from property and casualty underwriting and $175 million of life and annuity underwriting, for the three months ended September 30, 2004. Net premiums earned for the three months ended September 30, 2005 were $282.5 million compared to $331.1 million for the same period of 2004, the decrease is principally due to $83.2 million less life and annuity premiums written and earned in the three months ended September 30, 2005. Gross premiums written for the nine months ended September 30, 2005 were $988.8 million compared to $904.0 million for the first nine months of 2004.

“P/C reinsurance, primary insurance and life and annuity reinsurance accounted for 48 percent, 24.8 percent and 27.2 percent, respectively, of gross premiums written for the first nine months of 2005. Net premiums earned for the first nine months of 2005 increased 11.5 percent to $782.7 million compared to $701.8 million for the same period in 2004. The increase principally relates to increased life and annuity business written and earned in the first two quarters of 2005.”

The full report may be consulted on the company’s Website at: http://www.maxre.bm.

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