2015 QUARTER 1 FINANCIAL UPDATE The Insurance segment had a very strong first quarter as we continued to generate solid financial results. These results were primarily driven by the strong underwriting expertise that we have added to the company over the past two years. This expertise, coupled with the deep client and broker relationships which our underwriters have created, make Endurance a more relevant market. Our expanded U.S. and London Market insurance teams along with our established Bermuda platform continue to attract quality specialty business across our diverse product offerings. Looking ahead, we fully expect this positive momentum to continue as we further expand our capabilities and presence in these markets. — Jack Kuhn, CEO, Global Insurance, Endurance Specialty Holdings Ltd. INSURANCE LINES FINANCIAL HIGHLIGHTS (in millions of U.S. dollars, except percentages) Agriculture ARMtech, our U.S. crop insurance subsidiary, offers multi-peril crop insurance, crop hail, livestock risk protection and other agricultural risk management products through independent agents. Casualty & Other Specialty •P rimary and Excess Casualty We write primary and excess casualty insurance for small, middle market and Fortune 1000 accounts, accessed through retail and wholesale channels. •C ontract Binding Operation We offer property and general liability coverages for small to medium-sized risks through our U.S. contract binding agency network. • Healthcare Liability Our U.S. and Bermuda teams provide healthcare professional liability coverage to non-profit and for-profit hospitals and other healthcare organizations. • Surety We provide contract and commercial surety insurance through a network of dedicated agents across the U.S. Professional Lines We offer primary and excess coverage for directors’ and officers’ liability, errors and omissions liability, employment practices liability, and pension trust liability, underwriting through both retail and wholesale channels. • Energy Our London based team offers coverage across all aspects of the energy chain to clients ranging from independents to multinationals on a global basis. YEAR ENDED DEC 31, 2014 YEAR ENDED DEC 31, 2013 (UNAUDITED) (UNAUDITED) (AUDITED) (AUDITED) $1,301.4 $1,157.5 $2,894.1 $2,665.2 Net premiums written 765.0 798.7 1,934.2 2,048.9 Net income before preferred dividends 108.5 104.5 348.5 311.9 Loss ratio 44.1% 44.6% 52.1% 60.5% Combined ratio 82.4% 81.3% 86.0% 90.2% Gross premiums written $10,380.1 $9,794.8 $9,644.8 $8,978.1 Total shareholders’ equity $3,274.8 $3,001.1 $3,185.2 2,886.5 Debt to total capitalization 13.9% 15.0% 14.2% 15.5% Annualized ROAE, Operating income 13.0% 15.0% 11.7% 11.9% $736.2 $652.3 $1,716.1 $1,475.4 304.0 343.0 860.4 932.5 12.8 1.5 (0.6) (50.3) Total assets ENDURANCE INSURANCE Gross premiums written Net premiums written Underwriting income (loss) Loss ratio 54.8% 61.5% 71.4% 81.8% Combined ratio 90.6% 99.0% 100.1% 105.3% Twelve Months Ending March 31, 2015 Insurance Net Premiums Written = $821.4 Million 13% Agriculture Casualty & Other Specialty 16% 46% Property, Marine & Energy Professional Lines 25% Production by Major Brokers on Net Premiums Written* • Inland Marine We offer a full portfolio of inland marine coverage including both mono-line and marine packages. • Ocean Marine Our U.S. team offers marine liabilities, cargo, blue water hull and brown water hull coverage. QUARTER ENDED MAR 31, 2014 ENDURANCE SPECIALTY HOLDINGS LTD. Property, Marine & Energy • Property Our U.S. and London based teams provide all risk, named peril and DIC coverage for physical loss and damage to commercial property exposures on a primary, excess and proportional basis. Working through a broad distribution network, our clients range from small businesses to multinationals. QUARTER ENDED MAR 31, 2015 Marsh 20% Aon Willis 46% 12% 4% 6% 6% 6% AmWins R-T Specialty CRC/Crump Other** *Excludes Agriculture, which is distributed by Endurance’s ARMtech operating subsidiary through independent agents **Includes multiple brokers with a 3% or less share EXCELLENT FINANCIAL STRENGTH AND LIQUIDITY (March 31, 2015) Strong and Flexible Capital Structure (in millions of U.S. dollars) 4,000 $3,803 $3,713 3,500 $3,238 $3,139 3,000 $430 $430 $430 $430 $430 $528 $528 $527 $527 $528 2,500 $3,414 Endurance Group Financial Ratings A.M. Best — A (Excellent) XV Financial Strength Stable Outlook Standard & Poor’s — A (Strong) Stable Outlook NYSE: ENH Endurance’s total capital was $3.80 billion as of March 31, 2015 2,000 $2,845 $2,755 $2,457 $2,281 1,500 and includes $3.27 billion of shareholders’ equity. $2,181 At March 31, 2015, Endurance had 1,000 access to additional capital in the form 500 of a credit facility with approximately $587 million in remaining capacity. 0 2012 2011 Debt 2014 2013 Preferred Equity Mar 31, 2015 Endurance maintains significant levels Common Equity of liquidity with approximately 33% of investments in cash, short-term Investment Portfolio as of March 31, 2015 Fair Value = $6.5 Billion* investments, U.S. Government, and U.S. Government backed securities at Type of Investment March 31, 2015. Corporate Securities 5% 5% 9% 22% 6% 6% 16% 7% U.S. Government Agency Residential Mortgage-Backed Securities is comprised of high quality assets Other Investments with an average rating of AA- for our U.S. Government & Agencies Notes 9% 15% Endurance’s investment portfolio Non-Agency Commercial Mortgage-Backed Securities Asset-Backed Securities fixed income investments at March Equity Securities 31, 2015. Our priority is capital Collateralized loan and debt obligations Other Fixed Income Securities** Cash & Equivalents preservation while achieving attractive risk adjusted returns. Endurance’s investment portfolio 13% 24% Investment Portfolio Ratings*** AAA/Aaa U.S. Government & Agencies 21% 9% 33% AA/Aa A/A BBB and Below/Not Rated has been managed to an average duration of 2.95 years at March 31, 2015 to minimize interest rate risk. We carefully manage our asset-liability exposure and ensure that more than * Investment totals net of investments pending settlement **Includes multiple types of securities with a 3% or less share ***Excludes cash and cash equivalents, equity securities and other investments sufficient liquidity is available. To learn more, visit us at: www.endurance.bm ENDURANCE INSURANCE LOCATIONS BERMUDA Waterloo House 100 Pitts Bay Road Pembroke HM 08 Bermuda Tel No. +1.441.278.0400 UNITED KINGDOM London 2 Minster Court Mincing Lane London, EC3R 7BB United Kingdom Tel No. +44.207.337.2800 Chicago, Illinois 303 West Madison Suite 1800 Chicago, IL 60606 Tel No. +1.312.980.5300 New Hyde Park, New York 3333 New Hyde Park Road Suite 210 New Hyde Park, NY 11042 Tel No. +1.212.209.7229 Florham Park, New Jersey 600 Campus Road Floor 4 Florham Park, NJ 07932 Tel No. +1.908.376.2400 New York, New York 750 Third Avenue New York, NY 10017 Tel No. +1.212.209.6500 UNITED STATES Los Angeles, California 725 South Figueroa Street Suite 2100 Los Angeles, CA 90017 Tel No. +1.213.270.7000 Atlanta, Georgia 3780 Mansell Road, Suite 400 Alpharetta, GA 30022 Tel No. +1.770.799.2660 Lubbock, Texas 7101 82nd Street Lubbock, TX 79424 Tel No. +1.806.473.0333 St. Louis, Missouri 16052 Swingley Ridge Road Suite 130 St. Louis, MO 63017 Tel No. +1.636.681.1220 ENDURANCE INSURANCE LEADERSHIP John A. Kuhn Chief Executive Officer, Global Insurance [email protected] Graham Evans Chief Executive Officer, International Insurance [email protected] Michael Smith President & Chief Executive Officer, ARMtech Insurance Services, Inc. [email protected] Douglas M. Worman Chief Executive Officer, U.S. Insurance [email protected]
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