S&P Assigns White Mountain Insurance Group New Shelf Rating

March 20, 2002

Standard & Poor’s has assigned its triple-‘B’-minus preliminary rating to White Mountains Insurance Group Ltd.’s $1 billion shelf registration statement for indebtedness issued by Fund American Companies Inc.

Standard & Poor’s also said it assigned its triple-‘B’-minus long-term counterparty credit rating to White Mountains. The outlook is negative. It also revised its outlook on Fund American Companies Inc. to negative.

As of Dec. 31, 2001, White Mountains’s total debt was $1.1 billion with total capitalization of $2.6 billion, including a seller note of $260 million issued to CGNU PLC, with a settlement date of Nov. 29, 2002. Standard & Poor’s expectation is that the note will be settled with stock.

Standard & Poor’s will review the negative outlook upon completion of these actions.

Fund American is the intermediate holding company for all of White Mountain’s primary and reinsurance operations and for Fund American Trusts I, II, and III. All of the aforementioned are issuers under the shelf. In June 2001, White Mountains purchased the U.S. insurance operations of CGNU PLC. The primary and reinsurance companies operate under the names of OneBeacon Insurance Group and Folksamerica Reinsurance Co.

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