W. R. Berkley (WRB) 8-K W. R. Berkley Corporation Reports First Quarter Results Net Operating Income Up 25% to $121 Million

W. R. Berkley Corporation 475 Steamboat Road Greenwich, Connecticut 06830 (203) 629-3000	NEWS RELEASE
FOR IMMEDIATE RELEASE	CONTACT:
	Eugene G. Ballard
	Chief Financial Officer
	203-629-3000

W. R. Berkley Corporation 475 Steamboat Road Greenwich, Connecticut 06830 (203) 629-3000	NEWS RELEASE
FOR IMMEDIATE RELEASE	CONTACT:   Eugene G. Ballard Chief Financial Officer (203)629-3000

W. R. BERKLEY CORPORATION REPORTS FIRST QUARTER RESULTS
NET OPERATING INCOME UP 25% TO $121 MILLION

     Greenwich, CT, April 26, 2005 — W. R. Berkley Corporation (NYSE: BER)today reported net income for the first quarter of 2005 of $121 million, or 91 cents per share, a 5% increase from $115 million, or 88 cents per share, a year ago. Net operating income for the first quarter of 2005 increased 25% to $121 million, or 91 cents per share, compared with $97 million, or 74 cents per share, for the first quarter of 2004. Net operating income is a non-GAAP financial measure defined by the Company as net income excluding gains and losses on investments and the effect of a change in accounting principle in 2004. All per share amounts in this release have been adjusted to reflect the 3-for-2 common stock split effected on April 8, 2005.

Summary Financial Data
(Amounts in thousands, except per share data)

	First Quarter
	2005		2004
Gross premiums written	$	1,343,090	$	1,216,724
Net premiums written		1,188,168		1,086,702
Net income		120,871		115,428
Net income per diluted share		0.91		0.88
Net operating income		120,964		96,807
Net operating income per diluted share		0.91		0.74

W. R. Berkley Corporation Page 2

     First quarter highlights included:

•   Gross premiums written rose to $1.3 billion, an increase of 10% from the comparable quarter of 2004.

•   Investment income increased 31% to $90 million.

•   GAAP combined ratio improved to 89.2% from 90.2% in the prior year period.

•   The paid loss ratio continued to be excellent at 36.3% compared with 35.6% in the prior year quarter.

•   Cash flow from operations increased to $424 million.

     Commenting on the Company’s performance, William R. Berkley, chairman and chief executive officer, said: “We are very pleased with our results for the first quarter. The increase in gross premiums of 10 percent, which resulted primarily from new business, was in line with our expectations. Casualty pricing was generally flat with prices up in some lines and down in others. For property lines, which are not a significant part of our business, pricing continues to be weaker.

     “Profitability continues to be excellent, and our operating units are focused on delivering value differentiating service to help maintain a high retention rate. The returns on capital available for the next several years continue to look attractive, although by the start of next year it is likely to be a challenge to keep the returns at the level we currently enjoy. We are, however, optimistic that 2005 will be an outstanding year and that we should continue to deliver strong returns in 2006,” Mr. Berkley concluded.

     Founded in 1967, W. R. Berkley Corporation is an insurance holding company that operates in five segments of the property casualty insurance business: specialty insurance, regional property casualty insurance, alternative markets, reinsurance and international.

W. R. Berkley Corporation Page 3

     This is a “Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein, including statements related to our outlook for the industry and for our performance for the year 2005 and beyond, are based upon the Company’s historical performance and on current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. They are subject to various risks and uncertainties, including but not limited to, the cyclical nature of the property casualty industry, the long-tail and potentially volatile nature of the reinsurance business, product demand and pricing, claims development and the process of estimating reserves, the uncertain nature of damage theories and loss amounts, natural and man-made catastrophic losses, including as a result of terrorist activities, the impact of competition, the availability of reinsurance, exposure as to coverage for terrorist acts, our retention under The Terrorism Risk Insurance Act of 2002 (“TRIA”) and the potential expiration of TRIA, the ability of our reinsurers to pay reinsurance recoverables owed to us, investment risks, including those of our portfolio of fixed income securities and investments in equity securities, including merger arbitrage investments, exchange rate and political risks relating to our international operations, legislative and regulatory developments, including these related to alleged anti-competitive or other improper sales practices in the insurance industry, changes in the ratings assigned to us by ratings agencies, the availability of dividends from our insurance company subsidiaries, our ability to successfully acquire and integrate companies and invest in new insurance ventures, our ability to attract and retain qualified employees, and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission. These risks could cause actual results of the industry or our actual results for the year 2005 and beyond to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company. Any projections of growth in the Company’s net premiums written and management fees would not necessarily result in commensurate levels of underwriting and operating profits. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

# # #

W. R. Berkley Corporation Page 4

Consolidated Financial Summary
(Amounts in thousands, except per share data)

	First Quarter
	2005			2004
Revenues:
Net premiums written	$	1,188,168		$	1,086,702
Change in unearned premiums		(148,193	)		(135,170	)
Premiums earned		1,039,975			951,532
Net investment income		89,558			68,489
Service fees		30,299			28,239
Realized investment gains (losses)		(361	)		29,907
Other income		517			538
Total revenues		1,159,988			1,078,705
Expenses:
Losses and loss expenses		641,146			600,505
Other operating expenses		326,805			291,778
Interest expense		18,125			15,771
Total expenses		986,076			908,054
Income before income taxes and minority interest		173,912			170,651
Income tax expense		(52,729	)		(54,026	)
Minority interest		(312	)		(470	)
Net income before change in accounting principle		120,871			116,155
Cumulative effect of change in accounting principle, net of taxes		—			(727	)
Net income	$	120,871		$	115,428
Net income per share:
Basic (1)	$	0.96		$	0.92
Diluted (1)	$	0.91		$	0.88
Average shares outstanding:
Basic (1)		126,558			125,511
Diluted (1)		133,124			131,384

(1) Per share amounts have been adjusted to reflect the 3-for-2 common stock split effected on April 8, 2005.

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Operating Results by Segment
(Amounts in thousands, except ratios (1))

	First Quarter
	2005			2004
Specialty:
Gross premiums written	$	441,206		$	366,553
Net premiums written		413,415			344,755
Premiums earned		389,399			343,105
Pre-tax income		81,905			65,183
Loss ratio		61.9	%		62.9	%
Expense ratio		25.0	%		25.2	%
GAAP combined ratio		86.9	%		88.1	%
Regional (2):
Gross premiums written	$	367,373		$	336,543
Net premiums written		313,825			290,638
Premiums earned		280,299			247,971
Pre-tax income		59,063			45,794
Loss ratio		53.1	%		55.0	%
Expense ratio		30.5	%		30.9	%
GAAP combined ratio		83.6	%		85.9	%
Alternative Markets:
Gross premiums written	$	273,524		$	246,461
Net premiums written		228,020			213,151
Premiums earned		149,500			132,134
Pre-tax income		40,783			31,688
Loss ratio		67.9	%		71.2	%
Expense ratio		20.9	%		19.2	%
GAAP combined ratio		88.8	%		90.4	%
Reinsurance:
Gross premiums written	$	238,981		$	246,637
Net premiums written		213,117			219,683
Premiums earned		201,013			210,646
Pre-tax income		22,032			21,315
Loss ratio		68.5	%		69.0	%
Expense ratio		31.7	%		29.7	%
GAAP combined ratio		100.2	%		98.7	%
International (1):
Gross premiums written	$	22,006		$	20,530
Net premiums written		19,791			18,475
Premiums earned		19,764			17,676
Pre-tax income		2,128			1,591
Loss ratio		59.4	%		51.4	%
Expense ratio		35.3	%		35.3	%
GAAP combined ratio		94.7	%		86.7	%

(Continued)

W. R. Berkley Corporation Page 6

Operating Results by Segment (continued)
(Amounts in thousands, except ratios (1))

	First Quarter
	2005			2004
Corporate and Eliminations:
Realized investment gains (losses)	$	(361	)	$	29,907
Interest and other, net		(31,638	)		(24,827	)
Pre-tax income (loss)		(31,999	)		5,080
Total:
Gross premiums written	$	1,343,090		$	1,216,724
Net premiums written		1,188,168			1,086,702
Premiums earned		1,039,975			951,532
Pre-tax income		173,912			170,651
Loss ratio		61.7	%		63.1	%
Expense ratio		27.5	%		27.1	%
GAAP combined ratio		89.2	%		90.2	%

(1)

Loss ratio is losses and loss expenses incurred expressed as a percentage of premiums earned. Expense ratio is underwriting expenses expressed as a percentage of premiums earned. Underwriting expenses do not include expenses related to insurance services or unallocated corporate expenses. For the international segment, the loss and expense ratios do not include life insurance business. Combined ratio is the sum of loss ratio and expense ratio.

(2)

Weather-related losses for the regional segment were $2 and $4 million in the first quarter of 2005 and 2004, respectively.

W. R. Berkley Corporation Page 7

Supplemental Information
(Amounts in thousands, except per share data)

	First Quarter
	2005			2004
Reconciliation of net operating income to net income:
Net operating income (1)	$	120,964		$	96,807
Realized investment gains (losses)		(93	)		19,348
Cumulative effect of change in accounting principle		—			(727	)
Net income	$	120,871		$	115,428
Return on equity (2):
Net income		22.9	%		27.4	%
Net operating income		22.9	%		23.0	%
Cash flow:
Cash flow from operations		423,607			278,490
Cash flow from operations before cash transfers to trading account (3)	$	448,607		$	378,490

	March 31,		December 31,
	2005		2004
Selected balance sheet information:
Total investments (4)	$	8,703,597	$	8,341,944
Total assets		12,159,460		11,451,033
Reserves for losses		5,735,423		5,449,611
Senior notes and other debt		808,594		808,264
Junior subordinated debentures		208,296		208,286
Stockholders’ equity (5)		2,167,387		2,109,702
Shares outstanding		126,770		126,409
Stockholders’ equity per share		17.10		16.69

(1)	Net operating income is a non-GAAP financial measure defined by the Company as net income excluding gains and losses on investments and the effect of a change in accounting principle in 2004. Management believes that excluding investment gains and losses, which result primarily from changes in general economic conditions, and the change in accounting principle in 2004 provides a useful indicator of trends in the Company’s underlying operations.
(2)	Return on equity represents net income and net operating income expressed on an annualized basis as a percentage of beginning of year stockholders’ equity.
(3)	Cash flow from operations before cash transfers to/from trading account is a non-GAAP financial measure that excludes cash contributions to and withdrawals from the arbitrage trading account. Management believes that cash transfers to the arbitrage trading account are the result of changes in investment allocations and that excluding such transfers provides a useful measure of the Company’s cash flow.
(4)	Total investments includes cash and cash equivalents, trading accounts receivable from brokers and clearing organizations, trading account securities sold but not yet purchased and unsettled purchases.
(5)	Stockholders’ equity includes after-tax unrealized gains from investments and foreign exchange of $50 million and $112 million as of March 31, 2005 and December 31, 2004, respectively.