Endurance Specialty 8K Results of Operations and Financial Condition | ENH 29 Oct 09

Exhibit 99.2

Endurance Specialty Holdings Ltd.

INVESTOR FINANCIAL SUPPLEMENT

THIRD QUARTER 2009

Endurance Specialty Holdings Ltd.
Wellesley House, 90 Pitts Bay Rd.
Pembroke HM 08, Bermuda

Investor Relations
Phone: (441) 278-0988
Fax: (441) 278-0493
email: investorrelations@endurance.bm

This report is for information purposes only. It should be read in conjunction with other documents filed by Endurance Specialty Holdings Ltd. pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934.

Financial Supplement Table of Contents


	Page
i. Basis of Presentation		i
ii. Corporate Organization Chart		ii
I. Consolidated Financial Highlights		1
II. Consolidated Financial Statements
a. Consolidated Statements of Income (Loss) — Quarterly		2
b. Consolidated Statements of Income — YTD		3
c. Consolidated Balance Sheets		4
III. Other Financial Information
a. Endurance Operating Income Profile		5
b. Segment Distribution		7
c. Consolidated Segment Data		8
d. Deposit Accounting Adjustment Impacts on Segment Data		20
e. Return on Equity Analysis		22
f. ROE Component Analysis — Annualized Operating and Investment Leverage		23
g. Investment Portfolio Information		24
h. Structured Securities Detail		25
i. Largest Twenty-Five Corporate Holdings		26
IV. Loss Reserve Analysis
a. Activity in Reserve for Losses and Loss Expenses		27
b. Prior Year Reserve Development by Segment		28
c. Prior Year Reserve Development by Development Tail		29
d. Analysis of Unpaid Losses and Loss Expenses		30
V. Shareholder Return Analysis
a. Shareholder Return Analysis		31
b. Weighted Average Dilutive Shares Outstanding		32
c. Earnings per Share — Two Class Method		33
d. Operating Income Reconciliation — Two Class Method		34
e. Dilutive Shares Sensitivity Analysis		35
f. Book Value Per Share Analysis		36

VI. Regulation G		37

Application of the Safe Harbor of the Private Securities Litigation Reform Act of 1995:

Some of the statements in this financial supplement may include forward-looking statements which reflect our current views with respect to future events and financial performance. Such statements may include forward-looking statements both with respect to us in general and the insurance and reinsurance sectors specifically, both as to underwriting and investment matters. Statements which include the words “expect,” “intend,” “plan,” “believe,” “project,” “anticipate,” “seek,” “will,” and similar statements of a future or forward-looking nature identify forward-looking statements in this financial supplement for purposes of the U.S. federal securities laws or otherwise. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only to the date on which they are made. We undertake no obligation to publicly update or review any forward looking statement, when as a result of new information, future developments or otherwise.

All forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or may be important factors that could cause actual results to differ from those indicated in the forward-looking statements. These factors include, but are not limited to, developments in the world’s financial and capital markets that could adversely affect the performance of Endurance’s investment portfolio or access to capital, changes in the composition of Endurance’s investment portfolio, competition, possible terrorism or the outbreak of war, the frequency or severity of unpredictable catastrophic events, changes in demand for insurance or reinsurance, rating agency actions, uncertainties in our reserving process, a change in our tax status, acceptance of our products, the availability of reinsurance or retrocessional coverage, retention of key personnel, political conditions, the impact of current regulatory investigations, changes in accounting policies, changes in general economic conditions and other factors described in our Annual Report on Form 10-K for the year ended December 31, 2008 as amended on May 8, 2009.

ENDURANCE SPECIALTY HOLDINGS LTD.
BASIS OF PRESENTATION

DEFINITIONS AND PRESENTATION

•		All financial information contained herein is unaudited, except the balance sheet and income statement data for the years ended December 31, 2008, December 31, 2007 and December 31, 2006, which was derived from the Company’s audited financial statements.

•		Unless otherwise noted, all data is in thousands, except for per share, percentage and ratio information.

•		As used in this financial supplement, “common shares” refers to our ordinary shares and class A shares, collectively.

•		Endurance Specialty Holdings Ltd., along with others in the industry, uses underwriting ratios as measures of performance. The loss ratio is the ratio of claims and claims adjustment expense to earned premiums. The acquisition expense ratio is the ratio of underwriting expenses (commissions, taxes, licenses and fees, as well as other underwriting expenses) to earned premiums. The general and administrative expense ratio is the ratio of general and administrative expenses to earned premiums. The combined ratio is the sum of the loss ratio, the acquisition expense ratio and the general and administrative expense ratio. These ratios are relative measurements that describe for every $100 of net premiums earned, the cost of losses and expenses, respectively.

		The combined ratio presents the total cost per $100 of earned premium. A combined ratio below 100% demonstrates underwriting profit; a combined ratio above 100% demonstrates underwriting loss.

•		GAAP combined ratios differ from statutory combined ratios primarily due to the deferral of certain third party acquisition expenses for GAAP reporting purposes and the use of net premiums earned rather than net premiums written in the denominator when calculating the acquisition expense and the general & administrative expense ratios.

•		NM — Not meaningful; NA — Not Applicable; LTM — Latest twelve months.

ENDURANCE SPECIALTY HOLDINGS LTD.
CORPORATE ORGANIZATION CHART

ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED FINANCIAL HIGHLIGHTS


		QUARTER ENDED						NINE MONTHS ENDED						Previous			Previous
		SEPTEMBER 30,						SEPTEMBER 30,						Quarter			Year to Date
		2009			2008			2009			2008			Change			Change
HIGHLIGHTS	Net income (loss)	$	153,842			($99,392	)	$	381,279		$	81,757			(254.8	)%		366.4	%
	Net income (loss) available (attributable) to common and participating common shareholders		149,967			(103,267	)		369,654			70,132			(245.2	)%		427.1	%
	Net income (loss) allocated to common shareholders		147,445			(101,210	)		362,989			68,742			(245.7	)%		428.0	%
	Operating income (loss)[a]		148,064			(56,058	)		367,039			138,011			(364.1	)%		165.9	%
	Operating income (loss) available (attributable) to common and participating common shareholders[a]		144,189			(59,933	)		355,414			126,386			(340.6	)%		181.2	%
	Operating income (loss) allocated to common shareholders[a]		141,764			(58,739	)		349,005			123,934			(341.3	)%		181.6	%
	Operating cash flow		205,409			187,860			431,188			457,687			9.3	%		(5.8	)%
	Gross premiums written		469,622			624,144			1,812,083			2,010,798			(24.8	)%		(9.9	)%
	Net premiums earned		426,754			509,629			1,239,249			1,334,757			(16.3	)%		(7.2	)%
	Total assets		8,557,281			7,839,513			8,557,281			7,839,513			9.2	%		9.2	%
	Total shareholders’ equity		2,708,350			2,268,717			2,708,350			2,268,717			19.4	%		19.4	%


PER SHARE AND SHARES DATA	Basic earnings (losses) per common share[b]
	Net income (loss) (as reported)	$	2.63			($1.76	)	$	6.46		$	1.18			(249.4	)%		447.5	%
	Operating income (loss) (as reported)[a]	$	2.53			($1.02	)	$	6.21		$	2.12			(348.0	)%		192.9	%
	Diluted earnings (losses) per common share[b]
	Net income (loss) (as reported)	$	2.51			($1.79)[c]		$	6.15		$	1.09			(240.2	)%		464.2	%
	Operating income (loss) (as reported)[a]	$	2.41			($1.04)[c]		$	5.91		$	1.97			(331.7	)%		200.0	%
As Reported	Weighted average common shares outstanding		55,977			57,570			56,184			58,314			(2.8	)%		(3.7	)%
	Weighted average common shares outstanding and dilutive potential common shares		58,782			57,570			59,020			63,025			2.1	%		(6.4	)%

Book Value Per	Book value[d]	$	44.97		$	36.55		$	44.97		$	36.55			23.0	%		23.0	%
Common Share	Diluted book value (treasury stock method)[d]	$	42.09		$	33.68		$	42.09		$	33.68			25.0	%		25.0	%


FINANCIAL RATIOS	Return on average common equity (ROAE), net income (loss)[e]		6.3	%		(4.7	)%		16.4	%		3.2	%		11.0			13.2
	ROAE, operating income (loss)[a] [e]		6.0	%		(2.7	)%		15.7	%		5.8	%		8.7			9.9
	Return on beg. common equity (ROBE), net income (loss)[f]		6.6	%		(4.4	)%		18.4	%		3.0	%		11.0			15.4
	ROBE, operating income (loss)[a] [f]		6.3	%		(2.6	)%		17.7	%		5.5	%		8.9			12.2

	Annualized ROAE, net income (loss)[e]		25.1	%		(18.8	)%		21.8	%		4.3	%		43.9			17.5
	Annualized ROAE, operating income (loss)[a] [e]		24.1	%		(10.9	)%		21.0	%		7.7	%		35.0			13.3
	Annualized ROBE, net income (loss)[f]		26.4	%		(17.7	)%		24.5	%		4.0	%		44.1			20.5
	Annualized ROBE, operating income (loss)[a] [f]		25.2	%		(10.3	)%		23.6	%		7.3	%		35.5			16.3
	Annualized investment yield		5.0	%		2.0	%		5.3	%		3.2	%		3.0			2.1

	Loss ratio		49.6	%		87.4	%		56.7	%		68.2	%		(37.8	)		(11.5	)

GAAP	Acquisition expense ratio		14.8	%		13.8	%		15.7	%		16.5	%		1.0			(0.8	)
	General and administrative expense ratio		15.1	%		11.4	%		14.5	%		12.0	%		3.7			2.5

	Combined ratio		79.5	%		112.6	%		86.9	%		96.7	%		(33.1	)		(9.8	)


[a]		Operating income represents after-tax operational results excluding, as applicable, after-tax net realized capital gains or losses and after-tax net foreign exchange gains or losses. Please see page 34 for a reconciliation to net income.

[b]		Weighted average basic and dilutive common shares outstanding and basic and diluted earnings per common share have been calculated based on the two-class method for current and prior periods as required by new accounting guidance which was effective January 1, 2009. The guidance clarified which securities are to be considered participating securities and as such included in the calculation of earnings per share. All prior period per share amounts have been restated when participating securities were deemed to be outstanding. See pages 32 and 33.

[c]		Represents diluted losses per share of ($1.79) and ($1.04) calculated under the Treasury Stock Method which was the lower of the Treasury Stock Method and the Two-Class Method. See pages 33 and 34.

[d]		For detailed calculations, please refer to page 36.

[e]		Average common equity is calculated as the arithmetic average of the beginning and ending common equity balances for the stated periods, which excludes the $200 million liquidation value of the preferred shares.

[f]		Beginning common equity for the stated periods excludes the $200 million liquidation value of the preferred shares.

ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED STATEMENTS OF INCOME (LOSS) — QUARTERLY


	QUARTER ENDED
	SEPT. 30,			JUNE 30,			MAR. 31,			DEC. 31,			SEPT. 30,			SEPT. 30,
	2009			2009			2009			2008			2008			2007
UNDERWRITING REVENUES
Gross premiums written	$	469,622		$	559,155		$	783,306		$	235,622		$	624,144		$	423,271
Premiums ceded		(72,956	)		(79,128	)		(200,391	)		(55,527	)		(130,121	)		(45,655	)

Net premiums written	$	396,666		$	480,027		$	582,915		$	180,095		$	494,023		$	377,616
Change in unearned premiums		30,088			(45,807	)		(204,640	)		251,633			15,606			22,126

Net premiums earned	$	426,754		$	434,220		$	378,275		$	431,728		$	509,629		$	399,742
Other underwriting income (loss)		5			596			3,597			(2,454	)		(2,712	)		1,697

Total underwriting revenues	$	426,759		$	434,816		$	381,872		$	429,274		$	506,917		$	401,439

UNDERWRITING EXPENSES
Losses and loss expenses	$	211,683		$	270,816		$	220,136		$	225,103		$	445,501		$	186,456
Acquisition expenses		63,026			63,850			68,274			79,306			70,598			76,604
General and administrative expenses		64,436			54,529			60,257			56,059			57,771			55,121

Total underwriting expenses	$	339,145		$	389,195		$	348,667		$	360,468		$	573,870		$	318,181

Underwriting income (loss)	$	87,614		$	45,621		$	33,205		$	68,806			($66,953	)	$	83,258

OTHER OPERATING REVENUE
Net investment income (loss)	$	71,559		$	88,834		$	64,550			($4,594	)	$	27,410		$	62,605
Interest expense		(7,540	)		(7,538	)		(7,555	)		(7,568	)		(7,535	)		(7,533	)
Amortization of intangibles		(2,588	)		(2,588	)		(2,588	)		(2,762	)		(2,588	)		(1,127	)

Total other operating revenue	$	61,431		$	78,708		$	54,407			($14,924	)	$	17,287		$	53,945

INCOME (LOSS) BEFORE OTHER ITEMS	$	149,045		$	124,329		$	87,612		$	53,882			($49,666	)	$	137,203
OTHER
Net foreign exchange gains (loss)	$	2,963		$	27,723		$	62			($40,741	)		($15,477	)		($700	)
Net realized gains (losses) on investment sales		1,396			(1,500	)		3,241			29,286			(7,574	)		1,958

Total other-than-temporary impairment losses		(497	)		(37,809	)		(12,126	)		(41,086	)		(22,495	)		(5,013	)
Portion of loss recognised in other comprehensive income		—			31,165			—			—			—			—

Net impairment losses recognised in earnings[a]		(497	)		(6,644	)		(12,126	)		(41,086	)		(22,495	)		(5,013	)

Income tax benefit (expense)		935			5,232			(492	)		15,523			(4,180	)		(2,047	)

NET INCOME (LOSS)	$	153,842		$	149,140		$	78,297		$	16,864			($99,392	)	$	131,401
Preferred dividends		(3,875	)		(3,875	)		(3,875	)		(3,875	)		(3,875	)		(3,875	)


NET INCOME (LOSS) AVAILABLE (ATTRIBUTABLE) TO COMMON AND PARTICPATING COMMON SHAREHOLDERS	$	149,967		$	145,265		$	74,422		$	12,989			($103,267	)	$	127,526


KEY RATIOS/PER SHARE DATA
Loss ratio		49.6	%		62.4	%		58.2	%		52.1	%		87.4	%		46.6	%
Acquisition expense ratio		14.8	%		14.7	%		18.1	%		18.4	%		13.8	%		19.2	%
General and administrative expense ratio		15.1	%		12.5	%		15.9	%		13.0	%		11.4	%		13.8	%

Combined ratio		79.5	%		89.6	%		92.2	%		83.5	%		112.6	%		79.6	%


Basic earnings (losses) per common share[b]	$	2.63		$	2.53		$	1.30		$	0.23			($1.76	)	$	1.96
Diluted earnings (losses) per common share[b]	$	2.51		$	2.42		$	1.24		$	0.22			($1.79	)[c]	$	1.81

ROAE, net income (loss)[d]		6.3	%		6.7	%		3.7	%		0.6	%		(4.7	)%		5.7	%


[a]		Effective April 1, 2009, the Company adopted new accounting guidance related to the recognition and presentation of other-than-temporary impairments, which required the Company to identify whether an investment was in an unrealized loss position due to credit or non-credit related factors. Only credit related impairments are recognized in earnings.

[b]		Weighted average basic and dilutive common shares outstanding and basic and diluted earnings per common share have been calculated based on the two-class method for current and prior periods as required by new accounting guidance which was effective January 1, 2009. The guidance clarified which securities are to be considered participating securities and as such included in the calculation of earnings per share. All prior period per share amounts have been restated when participating securities were deemed to be outstanding. See pages 32 and 33.

[c]		Represents diluted losses per share of ($1.79) calculated under the Treasury Stock Method which was the lower of the Treasury Stock Method and the Two-Class Method. See page 33.

[d]		Average common equity is calculated as the arithmetic average of the beginning and ending equity balances for the stated periods, which excludes the $200 million liquidation value of the preferred shares.

ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED STATEMENTS OF INCOME — YTD


	NINE MONTHS ENDED									YEAR ENDED
	SEPT. 30,			SEPT. 30,			SEPT. 30,			DEC. 31,			DEC. 31,
	2009			2008			2007			2008			2007
UNDERWRITING REVENUES
Gross premiums written	$	1,812,083		$	2,010,798		$	1,503,365		$	2,246,420		$	1,781,115
Premiums ceded		(352,475	)		(406,603	)		(143,858	)		(462,130	)		(206,140	)

Net premiums written	$	1,459,608		$	1,604,195		$	1,359,507		$	1,784,290		$	1,574,975
Change in unearned premiums		(220,359	)		(269,438	)		(165,169	)		(17,805	)		19,825

Net premiums earned	$	1,239,249		$	1,334,757		$	1,194,338		$	1,766,485		$	1,594,800
Other underwriting income (loss)		4,198			(1,519	)		(7,442	)		(3,973	)		1,602

Total underwriting revenues	$	1,243,447		$	1,333,238		$	1,186,896		$	1,762,512		$	1,596,402

UNDERWRITING EXPENSES
Losses and loss expenses	$	702,635		$	910,328		$	604,229		$	1,135,431		$	749,081
Acquisition expenses		195,150			220,608			218,075			299,913			307,576
General and administrative expenses		179,222			160,308			152,614			216,365			217,269

Total underwriting expenses	$	1,077,007		$	1,291,244		$	974,918		$	1,651,709		$	1,273,926

Underwriting income	$	166,440		$	41,994		$	211,978		$	110,803		$	322,476

OTHER OPERATING REVENUE
Net investment income	$	224,943		$	134,770		$	215,966		$	130,176		$	281,276
Interest expense		(22,633	)		(22,603	)		(22,593	)		(30,171	)		(30,125	)
Amortization of intangibles		(7,764	)		(7,913	)		(3,381	)		(10,675	)		(5,286	)

Total other operating revenue	$	194,546		$	104,254		$	189,992		$	89,330		$	245,865

INCOME BEFORE OTHER ITEMS	$	360,986		$	146,248		$	401,970		$	200,133		$	568,341
OTHER
Net foreign exchange gains (losses)	$	30,748			($12,963	)		($1,241	)		($53,704	)		($7,970	)
Net realized gains (losses) on investment sales		3,137			(4,527	)		(3,191	)		24,769			(972	)

Total other-than-temporary impairment losses		(50,432	)		(41,039	)		(10,986	)		(82,135	)		(17,330	)
Portion of loss recognised in other comprehensive income		31,165			—			—			—			—

Net impairment losses recognised in earnings[a]		(19,267	)		(41,039	)		(10,986	)		(82,135	)		(17,330	)

Income tax benefit (expense)		5,675			(5,962	)		(17,975	)		9,561			(20,962	)

NET INCOME	$	381,279		$	81,757		$	368,577		$	98,624		$	521,107
Preferred dividends		(11,625	)		(11,625	)		(11,625	)		(15,500	)		(15,500	)

NET INCOME AVAILABLE TO COMMON AND PARTICIPATING COMMON SHAREHOLDERS	$	369,654		$	70,132		$	356,952		$	83,124		$	505,607


KEY RATIOS/PER SHARE DATA

Loss ratio		56.7	%		68.2	%		50.6	%		64.3	%		47.0	%
Acquisition expense ratio		15.7	%		16.5	%		18.2	%		17.0	%		19.3	%
General and administrative expense ratio		14.5	%		12.0	%		12.8	%		12.2	%		13.6	%

Combined ratio		86.9	%		96.7	%		81.6	%		93.5	%		79.9	%


Basic earnings per common share[b]	$	6.46		$	1.18		$	5.43		$	1.41		$	7.76
Diluted earnings per common share[b]	$	6.15		$	1.09		$	5.02		$	1.31		$	7.13

ROAE, net income[c]		16.4	%		3.2	%		16.1	%		3.8	%		22.9	%


[a]		Effective April 1, 2009, the Company adopted new accounting guidance related to the recognition and presentation of other-than-temporary impairments, which required the Company to identify whether an investment was in an unrealized loss position due to credit or non-credit related factors. Only credit related impairments are recognized in earnings.

[b]		Weighted average basic and dilutive common shares outstanding and basic and diluted earnings per common share have been calculated based on the two-class method for current and prior periods as required by new accounting guidance which was effective January 1, 2009. The guidance clarified which securities are to be considered participating securities and as such included in the calculation of earnings per share. All prior period per share amounts have been restated when participating securities were deemed to be outstanding. See pages 32 and 33.

[c]		Average common equity is calculated as the arithmetic average of the beginning and ending equity balances for the stated periods, which excludes the $200 million liquidation value of the preferred shares.

ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED BALANCE SHEETS


	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008			SEPT. 30, 2008			JUNE 30, 2008
ASSETS
Cash and cash equivalents	$	614,437		$	1,234,900		$	893,022		$	1,061,994		$	514,875		$	656,158
Fixed maturity investments available for sale, at fair value		4,494,429			4,059,327			4,125,770			3,875,137			4,359,085			4,556,575
Short term investments available for sale, at fair value		712,618			106,032			140,175			111,333			136,624			—
Preferred equity securities available for sale, at fair value		15,535			14,842			16,770			25,360			39,731			48,078
Other investments		335,498			318,729			285,853			284,263			338,151			366,886
Premiums receivable, net		828,316			1,052,662			1,017,619			609,387			1,130,184			1,101,610
Deferred acquisition costs		181,018			171,914			157,670			160,870			202,912			194,390
Securities lending collateral		113,499			174,846			120,321			112,940			134,256			153,062
Prepaid reinsurance premiums		169,097			223,267			282,981			149,591			205,284			205,454
Losses recoverable		454,972			361,605			345,978			557,834			251,375			240,354
Accrued investment income		27,826			26,668			24,509			30,872			32,893			37,930
Goodwill and intangible assets		194,033			195,873			198,447			200,791			202,682			205,635
Deferred tax assets		16,142			24,508			32,685			20,691			31,978			14,788
Receivable on pending investment sales		326,133			41,230			97,072			3,104			196,481			2,070
Other assets		73,728			72,942			58,547			68,303			63,002			73,667

TOTAL ASSETS	$	8,557,281		$	8,079,345		$	7,797,419		$	7,272,470		$	7,839,513		$	7,856,657


LIABILITIES
Reserve for losses and loss expenses	$	3,241,244		$	3,264,442		$	3,154,374		$	3,235,456		$	3,278,934		$	3,080,274
Reserve for unearned premiums		1,127,834			1,212,474			1,222,792			885,488			1,201,292			1,222,830
Deposit liabilities		47,338			51,787			54,712			58,622			85,701			89,718
Reinsurance balances payable		263,170			271,248			347,494			233,561			290,916			243,202
Securities lending payable		113,717			175,431			122,800			115,603			135,853			153,062
Debt		447,485			447,534			447,370			447,468			447,413			448,793
Payable on pending investment purchases		504,587			95,689			113,007			9			44,621			3,902
Other liabilities		103,556			85,143			81,330			88,980			86,066			80,981

TOTAL LIABILITIES	$	5,848,931		$	5,603,748		$	5,543,879		$	5,065,187		$	5,570,796		$	5,322,762

SHAREHOLDERS’ EQUITY
Preferred shares Series A, non-cumulative	$	8,000		$	8,000		$	8,000		$	8,000		$	8,000		$	8,000
Common shares		56,716			57,091			57,473			57,203			57,657			59,642
Additional paid-in capital		986,701			1,008,374			1,022,773			1,029,363			1,042,511			1,107,219
Accumulated other comprehensive income (loss)		51,541			(67,495	)		(140,139	)		(132,665	)		(86,146	)		(5,282	)
Retained earnings		1,605,392			1,469,627			1,305,433			1,245,382			1,246,695			1,364,316

TOTAL SHAREHOLDERS’ EQUITY	$	2,708,350		$	2,475,597		$	2,253,540		$	2,207,283		$	2,268,717		$	2,533,895

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	8,557,281		$	8,079,345		$	7,797,419		$	7,272,470		$	7,839,513		$	7,856,657


Book value per common share	$	44.97		$	40.59		$	36.47		$	35.76		$	36.55		$	39.97
Diluted book value per common share (treasury stock method)	$	42.09		$	38.07		$	34.34		$	33.06		$	33.68		$	36.72

RATIOS
Debt-to-capital		14.2	%		15.3	%		16.6	%		16.9	%		16.5	%		15.0	%

ENDURANCE SPECIALTY HOLDINGS LTD.

Annual Operating Income Profile

as of July 1, 2009

Operating Result — $ Millions

The above chart represents a cumulative analysis of our in-force underwriting portfolio on a full year basis based on thousands of potential scenarios. Loss years are driven largely by the occurrence of natural catastrophes and incorrect pricing of other property and casualty exposures. The operating income depicted includes net premiums earned plus net investment income, less acquisition expenses and G&A expenses. The operating income depicted excludes the effects of income tax (expenses) benefits, amortization of intangibles and interest expense. Forecasted investment income, acquisition and G&A expenses are held constant across all scenarios. Losses included above are net of reinsurance. Our stated objective is to maintain a risk management tolerance that limits our loss in a 1-in-100 year year to be no more than 25% of our shareholders’ equity.

Changes in Endurance’s underwriting portfolio, investment portfolio, risk control mechanisms, market conditions and other factors may cause actual results to vary considerably from those indicated by our value at risk curve. For a listing of risks related to Endurance and its future performance, please see “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2008 as amended on May 8, 2009.

ENDURANCE SPECIALTY HOLDINGS LTD.
Annual Operating Income Profile Comparison


										Change from Jul. 1, 2008 - - June 30, 2009						Change from Jan. 1, 2009 - - Dec. 31, 2009
										to Jul. 1, 2009 - June 30, 2010						to Jul. 1, 2009 - June 30, 2010
	Jul. 1, 2008 -			Jan. 1, 2009 -			Jul. 1, 2009 -			$			$			$		$
(in millions)	June 30, 2009			Dec. 31, 2009			June 30, 2010			Change			Change			Change		Change

Median Result	$	380		$	370		$	379			($1	)		(0.3	%)	$	9		2.4	%
Average Result		330			320			324			(6	)		(1.8	%)		4		1.3	%

1 in 10 year annual gain		61			19			24			(37	)		(60.7	%)		5		26.3	%
1 in 25 year annual loss		(209	)		(179	)		(170	)		39			(18.7	%)		9		(5.0	%)
1 in 50 year annual loss		(330	)		(345	)		(330	)		0			0.0	%		15		(4.3	%)
1 in 100 year annual loss		(487	)		(499	)		(483	)		4			(0.8	%)		16		(3.2	%)
1 in 250 year annual loss		(729	)		(778	)		(722	)		7			(1.0	%)		56		(7.2	%)
1 in 500 year annual loss		(882	)		(930	)		(839	)		43			(4.9	%)		91		(9.8	%)

ENDURANCE SPECIALTY HOLDINGS LTD.
SEGMENT DISTRIBUTION

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009

Net Premiums Written = $1.462 billion [a]


[a]		Prior to deposit accounting adjustments.

[b]		Other specialty includes the agriculture line in the Insurance segment and agriculture, marine, aerospace and surety and other specialty in the Reinsurance segment.

ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED SEGMENT DATA
FOR THE QUARTER ENDED SEPT. 30, 2009


							Total			Deposit
							Company			Accounting			Reported
	Insurance			Reinsurance			Sub-total			Adjustment [a]			Totals
UNDERWRITING REVENUES
Gross premiums written	$	248,673		$	220,460		$	469,133		$	489		$	469,622

Net premiums written	$	175,686		$	220,491		$	396,177		$	489		$	396,666

Net premiums earned	$	228,290		$	198,527		$	426,817			($63	)	$	426,754
Other underwriting income (loss)		382			—			382			(377	)		5

Total underwriting revenues	$	228,672		$	198,527		$	427,199			($440	)	$	426,759


UNDERWRITING EXPENSES
Losses and loss expenses	$	168,861		$	43,714		$	212,575			($892	)	$	211,683
Acquisition expenses		20,409			42,388			62,797			229			63,026
General and administrative expenses		36,015			28,421			64,436			—			64,436

Total expenses	$	225,285		$	114,523		$	339,808			($663	)	$	339,145


UNDERWRITING INCOME	$	3,387		$	84,004		$	87,391		$	223		$	87,614


GAAP RATIOS
Loss ratio		74.0	%		22.0	%		49.8	%					49.6	%
Acquisition expense ratio		8.9	%		21.4	%		14.7	%					14.8	%
General and administrative expense ratio		15.8	%		14.3	%		15.1	%					15.1	%

Combined ratio AS REPORTED		98.7	%		57.7	%		79.6	%					79.5	%


Effect of favorable prior accident year reserve development		6.1	%		10.0	%		7.9	%					8.1	%


Combined ratio net of prior accident year reserve development		104.8	%		67.7	%		87.5	%					87.6	%


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s underwriting results by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
INSURANCE SEGMENT DATA


	FOR THE QUARTERS ENDED
	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008			SEPT. 30, 2008			SEPT. 30, 2007
UNDERWRITING REVENUES
Gross premiums written	$	248,673		$	230,792		$	522,214		$	196,323		$	372,936		$	180,046

Net premiums written	$	175,686		$	153,762		$	322,430		$	141,466		$	248,601		$	137,404

Net premiums earned	$	228,290		$	223,588		$	180,674		$	236,726		$	270,298		$	130,640
Other underwriting income		382			103			2,959			—			—			—

Total underwriting revenues	$	228,672		$	223,691		$	183,633		$	236,726		$	270,298		$	130,640


UNDERWRITING EXPENSES
Losses and loss expenses	$	168,861		$	166,046		$	98,804		$	168,137		$	194,477		$	69,709
Acquisition expenses		20,409			20,855			24,841			27,601			24,065			19,542
General and administrative expenses		36,015			25,179			29,759			25,904			31,675			21,988

Total expenses	$	225,285		$	212,080		$	153,404		$	221,642		$	250,217		$	111,239


UNDERWRITING INCOME	$	3,387		$	11,611		$	30,229		$	15,084		$	20,081		$	19,401


GAAP RATIOS
Loss ratio		74.0	%		74.3	%		54.7	%		71.0	%		71.9	%		53.4	%
Acquisition expense ratio		8.9	%		9.3	%		13.7	%		11.7	%		8.9	%		14.9	%
General and administrative expense ratio		15.8	%		11.3	%		16.5	%		10.9	%		11.8	%		16.8	%

Combined ratio AS REPORTED		98.7	%		94.9	%		84.9	%		93.6	%		92.6	%		85.1	%


Effect of favorable prior accident year reserve development		6.1	%		8.9	%		20.4	%		10.3	%		6.4	%		19.2	%

Combined ratio net of prior accident year reserve development		104.8	%		103.8	%		105.3	%		103.9	%		99.0	%		104.3	%

ENDURANCE SPECIALTY HOLDINGS LTD.
REINSURANCE SEGMENT DATA


	FOR THE QUARTERS ENDED
	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008			SEPT. 30, 2008			SEPT. 30, 2007
UNDERWRITING REVENUES
Gross premiums written	$	220,460		$	328,593		$	263,378		$	42,053		$	251,228		$	243,787

Net premiums written	$	220,491		$	326,495		$	262,771		$	41,383		$	245,442		$	240,774

Net premiums earned	$	198,527		$	211,453		$	198,475		$	198,361		$	240,975		$	275,776


UNDERWRITING EXPENSES
Losses and loss expenses	$	43,714		$	105,844		$	121,422		$	53,962		$	257,512		$	119,798
Acquisition expenses		42,388			42,628			42,940			61,728			44,528			58,478
General and administrative expenses		28,421			29,350			30,498			30,155			26,096			33,133

Total expenses	$	114,523		$	177,822		$	194,860		$	145,845		$	328,136		$	211,409


UNDERWRITING INCOME (LOSS)	$	84,004		$	33,631		$	3,615		$	52,516			($87,161	)	$	64,367


GAAP RATIOS
Loss ratio		22.0	%		50.0	%		61.2	%		27.2	%		106.9	%		43.5	%
Acquisition expense ratio		21.4	%		20.2	%		21.6	%		31.1	%		18.5	%		21.2	%
General and administrative expense ratio		14.3	%		13.9	%		15.4	%		15.2	%		10.8	%		12.0	%

Combined ratio AS REPORTED		57.7	%		84.1	%		98.2	%		73.5	%		136.2	%		76.7	%


Effect of favorable (adverse) prior accident year reserve development		10.0	%		7.4	%		1.4	%		11.1	%		(0.8	)%		2.9	%

Combined ratio net of prior accident year reserve development		67.7	%		91.5	%		99.6	%		84.6	%		135.4	%		79.6	%


Note:		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. For the impact of deposit accounting on segment results, refer to page 20.

ENDURANCE SPECIALTY HOLDINGS LTD.
SEGMENT GROSS PREMIUMS WRITTEN BY LINE OF BUSINESS


	FOR THE QUARTERS ENDED
	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008			SEPT. 30, 2008			SEPT. 30, 2007
INSURANCE SEGMENT
Property	$	30,307		$	40,084		$	27,751		$	40,291		$	35,574		$	28,379
Casualty		39,671			50,605			30,624			27,810			29,196			30,133
Healthcare liability		30,390			23,202			19,713			10,704			28,010			30,262
Workers’ compensation		(2,384	)		(1,413	)		30,579			37,752			41,709			70,398
Agriculture		104,021			56,235			378,410			30,126			195,852			—
Professional lines		46,668			62,079			35,137			49,640			42,595			20,874

TOTAL INSURANCE	$	248,673		$	230,792		$	522,214		$	196,323		$	372,936		$	180,046


REINSURANCE SEGMENT
Casualty	$	61,394		$	83,997		$	75,494		$	3,018		$	53,890		$	66,006
Property		115,342			55,244			36,879			11,635			113,080			112,407
Catastrophe		31,637			148,380			109,448			13,986			65,825			43,684
Agriculture		1,014			2,902			4,859			1,298			3,452			6,917
Aerospace and Marine		6,690			23,597			12,312			10,734			9,814			9,179
Surety and other specialty		4,383			14,473			24,386			1,382			5,167			5,594

TOTAL REINSURANCE	$	220,460		$	328,593		$	263,378		$	42,053		$	251,228		$	243,787


TOTAL COMPANY SUBTOTAL	$	469,133		$	559,385		$	785,592		$	238,376		$	624,164		$	423,833
DEPOSIT ACCOUNTING ADJUSTMENT[a]		489			(230	)		(2,286	)		(2,754	)		(20	)		(562	)

REPORTED TOTALS	$	469,622		$	559,155		$	783,306		$	235,622		$	624,144		$	423,271


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s gross premiums written by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
SEGMENT NET PREMIUMS WRITTEN BY LINE OF BUSINESS


	FOR THE QUARTERS ENDED
	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008				SEPT. 30, 2008			SEPT. 30, 2007
INSURANCE SEGMENT
Property	$	13,467		$	22,125		$	17,487		$	25,467			$	20,901		$	7,689
Casualty		25,025			28,291			17,880			18,403				18,141			16,467
Healthcare liability		29,075			22,871			17,209			10,704				27,636			30,262
Workers’ compensation		(2,291	)		(2,608	)		16,929			38,776				37,685			64,131
Agriculture		71,767			28,713			223,303			4,947		��		109,159			—
Professional lines		38,643			54,370			29,622			43,169				35,079			18,855

TOTAL INSURANCE	$	175,686		$	153,762		$	322,430		$	141,466			$	248,601		$	137,404


REINSURANCE SEGMENT
Casualty	$	61,386		$	83,989		$	75,270		$	2,824			$	53,889		$	65,946
Property		115,342			55,244			36,879			11,634				113,080			112,398
Catastrophe		31,637			148,380			109,448			13,986				60,699			41,025
Agriculture		1,014			2,902			4,859			1,144				3,769			7,028
Aerospace and Marine		6,675			21,569			12,217			10,422				8,838			8,390
Surety and other specialty		4,437			14,411			24,098			1,373				5,167			5,987

TOTAL REINSURANCE	$	220,491		$	326,495		$	262,771		$	41,383			$	245,442		$	240,774


TOTAL COMPANY SUBTOTAL	$	396,177		$	480,257		$	585,201		$	182,849			$	494,043		$	378,178
DEPOSIT ACCOUNTING ADJUSTMENT[a]		489			(230	)		(2,286	)		(2,754	)			(20	)		(562	)

REPORTED TOTALS	$	396,666		$	480,027		$	582,915		$	180,095			$	494,023		$	377,616


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s net premiums written by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
SEGMENT NET PREMIUMS EARNED BY LINE OF BUSINESS


	FOR THE QUARTERS ENDED
	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008			SEPT. 30, 2008			SEPT. 30, 2007
INSURANCE SEGMENT
Property	$	16,948		$	20,677		$	21,691		$	22,431		$	19,506		$	8,325
Casualty		24,389			19,694			21,732			21,992			21,685			20,886
Healthcare liability		20,347			19,940			19,989			20,087			21,094			23,606
Workers’ compensation		19,155			26,998			37,498			56,593			57,699			59,011
Agriculture		107,821			93,806			49,268			88,951			128,967			—
Professional lines		39,630			42,473			30,496			26,672			21,347			18,812

TOTAL INSURANCE	$	228,290		$	223,588		$	180,674		$	236,726		$	270,298		$	130,640


REINSURANCE SEGMENT
Casualty	$	52,700		$	50,156		$	50,663		$	41,800		$	45,133		$	62,032
Property		52,994			55,588			44,843			50,078			50,658			52,773
Catastrophe		68,342			77,987			74,716			69,013			101,232			84,615
Agriculture		2,397			3,298			2,525			988			6,559			33,827
Aerospace and Marine		11,043			11,818			14,691			22,531			21,017			25,571
Surety and other specialty		11,051			12,606			11,037			13,951			16,376			16,958

TOTAL REINSURANCE	$	198,527		$	211,453		$	198,475		$	198,361		$	240,975		$	275,776


TOTAL COMPANY SUBTOTAL	$	426,817		$	435,041		$	379,149		$	435,087		$	511,273		$	406,416
DEPOSIT ACCOUNTING ADJUSTMENT[a]		(63	)		(821	)		(874	)		(3,359	)		(1,644	)		(6,674	)

REPORTED TOTALS	$	426,754		$	434,220		$	378,275		$	431,728		$	509,629		$	399,742


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s net premiums earned by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED SEGMENT DATA
FOR THE NINE MONTHS ENDED SEPT. 30, 2009


							Total			Deposit
							Company			Accounting			Reported
	Insurance			Reinsurance			Sub-total			Adjustment [a]			Totals
UNDERWRITING REVENUES
Gross premiums written	$	1,001,679		$	812,431		$	1,814,110			($2,027	)	$	1,812,083

Net premiums written	$	651,878		$	809,757		$	1,461,635			($2,027	)	$	1,459,608

Net premiums earned	$	632,552		$	608,455		$	1,241,007			($1,758	)	$	1,239,249
Other underwriting income		3,444			—			3,444			754			4,198

Total underwriting revenues	$	635,996		$	608,455		$	1,244,451			($1,004	)	$	1,243,447


UNDERWRITING EXPENSES
Losses and loss expenses	$	433,711		$	270,980		$	704,691			($2,056	)	$	702,635
Acquisition expenses		66,105			127,956			194,061			1,089			195,150
General and administrative expenses		90,953			88,269			179,222			—			179,222

Total expenses	$	590,769		$	487,205		$	1,077,974			($967	)	$	1,077,007


UNDERWRITING INCOME (LOSS)	$	45,227		$	121,250		$	166,477			($37	)	$	166,440


GAAP RATIOS
Loss ratio		68.6	%		44.6	%		56.8	%					56.7	%
Acquisition expense ratio		10.4	%		21.0	%		15.6	%					15.7	%
General and administrative expense ratio		14.4	%		14.5	%		14.5	%					14.5	%

Combined ratio AS REPORTED		93.4	%		80.1	%		86.9	%					86.9	%


Effect of favorable prior accident year reserve development		11.2	%		6.3	%		8.8	%					8.9	%


Combined ratio net of prior accident year reserve development		104.6	%		86.4	%		95.7	%					95.8	%


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s underwriting results by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
INSURANCE SEGMENT DATA


	FOR THE NINE MONTHS ENDED									FOR THE YEARS ENDED
	SEPT. 30, 2009			SEPT. 30, 2008			SEPT. 30, 2007			DEC. 31, 2008			DEC. 31, 2007
UNDERWRITING REVENUES
Gross premiums written	$	1,001,679		$	1,230,043		$	525,046		$	1,426,366		$	741,556

Net premiums written	$	651,878		$	839,132		$	397,494		$	980,598		$	551,970

Net premiums earned	$	632,552		$	683,662		$	365,021		$	920,389		$	502,082
Other underwriting income		3,444			—			—			—			—

Total underwriting revenues	$	635,996		$	683,662		$	365,021		$	920,389		$	502,082


UNDERWRITING EXPENSES
Losses and loss expenses	$	433,711		$	513,598		$	196,660		$	681,735		$	290,213
Acquisition expenses		66,105			76,182			49,844			103,783			72,044
General and administrative expenses		90,953			77,308			62,796			103,211			89,996

Total expenses	$	590,769		$	667,088		$	309,300		$	888,729		$	452,253


UNDERWRITING INCOME	$	45,227		$	16,574		$	55,721		$	31,660		$	49,829


GAAP RATIOS
Loss ratio		68.6	%		75.1	%		53.9	%		74.1	%		57.8	%
Acquisition expense ratio		10.4	%		11.2	%		13.6	%		11.3	%		14.4	%
General and administrative expense ratio		14.4	%		11.3	%		17.2	%		11.2	%		17.9	%

Combined ratio AS REPORTED		93.4	%		97.6	%		84.7	%		96.6	%		90.1	%


Effect of favorable prior accident year reserve development		11.2	%		6.8	%		19.3	%		7.7	%		16.0	%

Combined ratio net of prior accident year reserve development		104.6	%		104.4	%		104.0	%		104.3	%		106.1	%

ENDURANCE SPECIALTY HOLDINGS LTD.
REINSURANCE SEGMENT DATA


	FOR THE NINE MONTHS ENDED									FOR THE YEARS ENDED
	SEPT. 30, 2009			SEPT. 30, 2008			SEPT. 30, 2007			DEC. 31, 2008			DEC. 31, 2007
UNDERWRITING REVENUES
Gross premiums written	$	812,431		$	783,092		$	1,002,075		$	825,145		$	1,068,114

Net premiums written	$	809,757		$	767,400		$	985,769		$	808,783		$	1,051,560

Net premiums earned	$	608,455		$	656,712		$	891,489		$	855,072		$	1,159,261


UNDERWRITING EXPENSES
Losses and loss expenses	$	270,980		$	405,451		$	460,670		$	459,413		$	502,804
Acquisition expenses		127,956			143,184			184,503			204,912			255,091
General and administrative expenses		88,269			83,000			89,818			113,154			127,273

Total expenses	$	487,205		$	631,635		$	734,991		$	777,479		$	885,168


UNDERWRITING INCOME	$	121,250		$	25,077		$	156,498		$	77,593		$	274,093


GAAP RATIOS
Loss ratio		44.6	%		61.7	%		51.7	%		53.7	%		43.4	%
Acquisition expense ratio		21.0	%		21.8	%		20.7	%		24.0	%		22.0	%
General and administrative expense ratio		14.5	%		12.7	%		10.0	%		13.2	%		11.0	%

Combined ratio AS REPORTED		80.1	%		96.2	%		82.4	%		90.9	%		76.4	%


Effect of favorable prior accident year reserve development		6.3	%		10.2	%		4.4	%		10.4	%		6.4	%

Combined ratio net of prior accident year reserve development		86.4	%		106.4	%		86.8	%		101.3	%		82.8	%


Note:		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. For the impact of deposit accounting on segment results, refer to page 21.

ENDURANCE SPECIALTY HOLDINGS LTD.
SEGMENT GROSS PREMIUMS WRITTEN BY LINE OF BUSINESS


	FOR THE NINE MONTHS ENDED									FOR THE YEARS ENDED
	SEPT. 30, 2009			SEPT. 30, 2008			SEPT. 30, 2007			DEC. 31, 2008			DEC. 31, 2007
INSURANCE SEGMENT
Property	$	98,142		$	119,116		$	96,256		$	159,408		$	134,161
Casualty		120,900			93,058			99,273			120,867			125,124
Healthcare liability		73,305			69,987			77,105			80,692			92,361
Workers’ compensation		26,782			195,076			189,173			232,828			262,228
Agriculture		538,666			660,193			—			690,318			42,242
Professional lines		143,884			92,613			63,239			142,253			85,440

TOTAL INSURANCE	$	1,001,679		$	1,230,043		$	525,046		$	1,426,366		$	741,556


REINSURANCE SEGMENT
Casualty	$	220,885		$	159,434		$	185,730		$	162,453		$	201,032
Property		207,465			184,214			214,584			195,849			228,796
Catastrophe		289,465			301,277			331,689			315,262			345,187
Agriculture		8,775			20,185			124,095			21,483			131,325
Aerospace and Marine		42,599			70,600			81,223			81,334			92,882
Surety and other specialty		43,242			47,382			64,754			48,764			68,892

TOTAL REINSURANCE	$	812,431		$	783,092		$	1,002,075		$	825,145		$	1,068,114


TOTAL COMPANY SUBTOTAL	$	1,814,110		$	2,013,135		$	1,527,121		$	2,251,511		$	1,809,670
DEPOSIT ACCOUNTING ADJUSTMENT[a]		(2,027	)		(2,337	)		(23,756	)		(5,091	)		(28,555	)

REPORTED TOTALS	$	1,812,083		$	2,010,798		$	1,503,365		$	2,246,420		$	1,781,115


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s gross premiums written by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
SEGMENT NET PREMIUMS WRITTEN BY LINE OF BUSINESS


	FOR THE NINE MONTHS ENDED									FOR THE YEARS ENDED
	SEPT. 30, 2009			SEPT. 30, 2008			SEPT. 30, 2007			DEC. 31, 2008			DEC. 31, 2007
INSURANCE SEGMENT
Property	$	53,079		$	72,545		$	31,078		$	98,012		$	47,905
Casualty		71,196			68,207			61,044			86,610			77,188
Healthcare liability		69,155			69,297			77,105			80,002			92,361
Workers’ compensation		12,030			177,072			171,941			215,848			238,369
Agriculture		323,783			375,752			—			380,699			21,115
Professional lines		122,635			76,259			56,326			119,427			75,032

TOTAL INSURANCE	$	651,878		$	839,132		$	397,494		$	980,598		$	551,970


REINSURANCE SEGMENT
Casualty	$	220,645		$	160,664		$	185,478		$	163,487		$	200,385
Property		207,465			184,187			215,999			195,822			230,211
Catastrophe		289,465			288,085			318,929			302,070			332,428
Agriculture		8,775			19,867			122,106			21,011			129,337
Aerospace and Marine		40,461			67,381			78,809			77,804			90,613
Surety and other specialty		42,946			47,216			64,448			48,589			68,586

TOTAL REINSURANCE	$	809,757		$	767,400		$	985,769		$	808,783		$	1,051,560


TOTAL COMPANY SUBTOTAL	$	1,461,635		$	1,606,532		$	1,383,263		$	1,789,381		$	1,603,530
DEPOSIT ACCOUNTING ADJUSTMENT[a]		(2,027	)		(2,337	)		(23,756	)		(5,091	)		(28,555	)

REPORTED TOTALS	$	1,459,608		$	1,604,195		$	1,359,507		$	1,784,290		$	1,574,975


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s net premiums written by segment to the premiums written by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
SEGMENT NET PREMIUMS EARNED BY LINE OF BUSINESS


	FOR THE NINE MONTHS ENDED									FOR THE YEARS ENDED
	SEPT. 30, 2009			SEPT. 30, 2008			SEPT. 30, 2007			DEC. 31, 2008			DEC. 31, 2007
INSURANCE SEGMENT
Property	$	59,316		$	53,153		$	33,307		$	75,585		$	46,043
Casualty		65,815			64,260			64,991			86,252			85,312
Healthcare liability		60,276			66,336			75,723			86,422			99,139
Workers’ compensation		83,651			185,847			135,403			242,440			190,672
Agriculture		250,895			254,957			—			343,909			6,661
Professional lines		112,599			59,109			55,597			85,781			74,255

TOTAL INSURANCE	$	632,552		$	683,662		$	365,021		$	920,389		$	502,082


REINSURANCE SEGMENT
Casualty	$	153,519		$	145,293		$	212,220		$	187,093		$	260,960
Property		153,425			152,741			195,945			202,819			250,610
Catastrophe		221,045			230,447			239,806			299,459			320,323
Agriculture		8,220			16,860			91,260			17,848			128,643
Aerospace and Marine		37,552			63,105			99,031			85,636			127,645
Surety and other specialty		34,694			48,266			53,227			62,217			71,080

TOTAL REINSURANCE	$	608,455		$	656,712		$	891,489		$	855,072		$	1,159,261


TOTAL COMPANY SUBTOTAL	$	1,241,007		$	1,340,374		$	1,256,510		$	1,775,461		$	1,661,343
DEPOSIT ACCOUNTING ADJUSTMENT[a]		(1,758	)		(5,617	)		(62,172	)		(8,976	)		(66,543	)

REPORTED TOTALS	$	1,239,249		$	1,334,757		$	1,194,338		$	1,766,485		$	1,594,800


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s net premiums earned by segment to the premiums earned by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
DEPOSIT ACCOUNTING ADJUSTMENT IMPACTS ON SEGMENT DATA
FOR THE QUARTER ENDED SEPT. 30, 2009


	Includes Deposit Accounting Adjustments									Excludes Deposit Accounting Adjustments
							Total									Total
	Insurance			Reinsurance			Company			Insurance			Reinsurance			Company
UNDERWRITING REVENUES
Gross premiums written	$	248,673		$	220,949		$	469,622		$	248,673		$	220,460		$	469,133

Net premiums written	$	175,686		$	220,980		$	396,666		$	175,686		$	220,491		$	396,177

Net premiums earned	$	228,290		$	198,464		$	426,754		$	228,290		$	198,527		$	426,817
Other underwriting income (loss)		382			(377	)		5			382			—			382

Total underwriting revenues	$	228,672		$	198,087		$	426,759		$	228,672		$	198,527		$	427,199


UNDERWRITING EXPENSES
Losses and loss expenses	$	168,861		$	42,822		$	211,683		$	168,861		$	43,714		$	212,575
Acquisition expenses		20,409			42,617			63,026			20,409			42,388			62,797
General and administrative expenses		36,015			28,421			64,436			36,015			28,421			64,436

Total expenses	$	225,285		$	113,860		$	339,145		$	225,285		$	114,523		$	339,808


UNDERWRITING INCOME	$	3,387		$	84,227		$	87,614		$	3,387		$	84,004		$	87,391


GAAP RATIOS
Loss ratio		74.0	%		21.6	%		49.6	%		74.0	%		22.0	%		49.8	%
Acquisition expense ratio		8.9	%		21.5	%		14.8	%		8.9	%		21.4	%		14.7	%
General and administrative expense ratio		15.8	%		14.3	%		15.1	%		15.8	%		14.3	%		15.1	%

Combined ratio		98.7	%		57.4	%		79.5	%		98.7	%		57.7	%		79.6	%

ENDURANCE SPECIALTY HOLDINGS LTD.
DEPOSIT ACCOUNTING ADJUSTMENT IMPACTS ON SEGMENT DATA
FOR THE NINE MONTHS ENDED SEPT. 30, 2009


	Includes Deposit Accounting Adjustments									Excludes Deposit Accounting Adjustments
							Total									Total
	Insurance			Reinsurance			Company			Insurance			Reinsurance			Company
UNDERWRITING REVENUES
Gross premiums written	$	1,001,679		$	810,404		$	1,812,083		$	1,001,679		$	812,431		$	1,814,110

Net premiums written	$	651,878		$	807,730		$	1,459,608		$	651,878		$	809,757		$	1,461,635

Net premiums earned	$	632,552		$	606,697		$	1,239,249		$	632,552		$	608,455		$	1,241,007
Other underwriting income		3,444			754			4,198			3,444			—			3,444

Total underwriting revenues	$	635,996		$	607,451		$	1,243,447		$	635,996		$	608,455		$	1,244,451


UNDERWRITING EXPENSES
Losses and loss expenses	$	433,711		$	268,924		$	702,635		$	433,711		$	270,980		$	704,691
Acquisition expenses		66,105			129,045			195,150			66,105			127,956			194,061
General and administrative expenses		90,953			88,269			179,222			90,953			88,269			179,222

Total expenses	$	590,769		$	486,238		$	1,077,007		$	590,769		$	487,205		$	1,077,974


UNDERWRITING INCOME	$	45,227		$	121,213		$	166,440		$	45,227		$	121,250		$	166,477


GAAP RATIOS
Loss ratio		68.6	%		44.3	%		56.7	%		68.6	%		44.6	%		56.8	%
Acquisition expense ratio		10.4	%		21.3	%		15.7	%		10.4	%		21.0	%		15.6	%
General and administrative expense ratio		14.4	%		14.5	%		14.5	%		14.4	%		14.5	%		14.5	%

Combined ratio		93.4	%		80.1	%		86.9	%		93.4	%		80.1	%		86.9	%

ENDURANCE SPECIALTY HOLDINGS LTD.
RETURN ON EQUITY ANALYSIS


	FOR THE NINE MONTHS
	ENDED SEPT. 30, 2009

Average common equity[a]	$	2,257,817

Net premiums earned	$	1,239,249
Combined ratio		86.9	%
Operating margin		13.1	%
Premium leverage		0.55x
Implied ROAE from underwriting activity		7.2	%


Average cash and invested assets at amortized cost	$	5,725,261
Investment leverage		2.54x
Year to date investment income yield, pretax		3.9	%
Implied ROAE from investment activity		9.9	%


Financing Costs [b]		(1.5	)%


Implied Pre-tax Operating ROAE, for period [c]		15.6	%


[a]		Average common equity is calculated as the arithmetic average of the beginning and ending common equity balances for the stated periods, which excludes the $200 million liquidation value of the preferred shares.

[b]		Financing costs include interest expense and preferred dividends.

[c]		Implied pre-tax Operating ROAE considers only the main components of the Company’s return on equity — underwriting and investment returns. As such, it differs from operating ROE primarily due to the exclusion of tax on underwriting, financing and investment activites and the tax-effected impact of amortization expense.

ENDURANCE SPECIALTY HOLDINGS LTD.
ANNUALIZED OPERATING & INVESTMENT LEVERAGE


	FOR THE QUARTERS ENDED												YEARS ENDED DECEMBER 31,
	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008			2008			2007

Average common equity[a]	$	2,391,974		$	2,164,569		$	2,030,412		$	2,038,000		$	2,159,771		$	2,205,067

Net premiums earned	$	426,754		$	434,220		$	378,275		$	431,728		$	1,766,485		$	1,594,800

Operating leverage		0.18x			0.20x			0.19x			0.21x			0.82x			0.72x

Annualized operating leverage		0.71	x		0.80	x		0.76	x		0.85	x		0.82	x		0.72	x


Average cash and invested assets at amortized cost	$	5,857,231		$	5,671,952		$	5,539,981		$	5,570,796		$	5,539,981		$	5,559,204

Investment leverage		2.45	x		2.62	x		2.73	x		2.73	x		2.57	x		2.52	x


[a]		Average common equity is calculated as the arithmetic average of the beginning and ending equity balances for the stated periods and excludes the $200 million liquidation value of the preferred shares.

ENDURANCE SPECIALTY HOLDINGS LTD.
INVESTMENT PORTFOLIO
AS OF SEPTEMBER 30, 2009 AND DECEMBER 31, 2008


	September 30, 2009					December 31, 2008
Type of Investment	Fair Value		Percentage			Fair Value		Percentage
Cash and equivalents[a]	$	435,983		7.3	%	$	1,065,089		19.9	%
Short term investments		712,618		11.9	%		111,333		2.1	%
U.S. government and government agencies notes		825,573		13.8	%		657,748		12.3	%
Government and agency guaranteed corporates		831,440		13.9	%		80,239		1.5	%
U.S. government agency residential mortgage-backed securities		966,627		16.1	%		1,145,673		21.4	%
U.S. government agency commercial mortgage-backed securities		33,530		0.5	%		33,325		0.6	%
Municipals		91,204		1.5	%		108,225		2.0	%
Foreign government		146,432		2.4	%		180,940		3.4	%
Corporate securities		500,753		8.4	%		504,019		9.3	%
Non-agency residential mortgage-backed securities		273,973		4.6	%		377,563		7.0	%
Non-agency commercial mortgage-backed securities		540,207		9.0	%		539,230		10.1	%
Asset-backed securities		284,690		4.7	%		248,175		4.6	%
Preferred equity securities		15,535		0.3	%		25,360		0.5	%
Other investments[b]		335,498		5.6	%		284,263		5.3	%

Total	$	5,994,063		100.0	%	$	5,361,182		100.0	%


Ratings [e]	Fair Value		Percentage			Fair Value		Percentage
U.S. government and government agencies notes	$	825,573		14.9	%	$	657,748		15.3	%
AAA/Aaa		3,642,668		65.5	%		2,787,923		65.0	%
AA/Aa		226,022		4.1	%		163,718		3.8	%
A/A		297,950		5.4	%		327,829		7.6	%
BBB		37,979		0.7	%		29,902		0.7	%
Below BBB		191,957		3.4	%		43,777		1.0	%
Not Rated		433		—			933		—
Other investments[b]		335,498		6.0	%		284,263		6.6	%

Total	$	5,558,080		100.0	%	$	4,296,093		100.0	%


Performance	September 30, 2009			December 31, 2008
Yield[c]		5.3	%		2.4	%
Duration[d]		2.27			2.28


	Quarter Ended		Quarter Ended		Quarter Ended		Quarter Ended			Quarter Ended
Investment Income (loss)	Sept. 30, 2009		June 30, 2009		Mar. 31, 2009		Dec. 31, 2008			Sept. 30, 2008
Cash and fixed income securities	$	41,171	$	48,327	$	54,095	$	57,556		$	60,199
Other Investments		30,388		40,507		10,455		(62,150	)		(32,789	)

Total net investment income (loss)	$	71,559	$	88,834	$	64,550		($4,594	)	$	27,410


Note:		[a]Cash and equivalents, including operating cash, are shown net of investments pending settlement.

		[b]Other investments includes investments in alternative and high yield bank loan funds.

		[c]Annualized earned yield for the nine months ending 9/30/09 and twelve months ending 12/31/08 excludes realized and unrealized gains and losses on fixed maturity investments.

		[d]Duration excludes other investments and operating cash.

		[e]Excludes cash and equivalents.

ENDURANCE SPECIALTY HOLDINGS LTD.
STRUCTURED SECURITIES DETAIL
AS OF SEPT. 30, 2009


						Percentage of
Securitized (RMBS, CMBS, ABS and CDO) securities ratings	Fair Value		Percentage			Investment Portfolio
U.S. Government and agencies	$	1,000,157		47.7	%		16.7	%
AAA/Aaa		850,802		40.5	%		14.2	%
AA/Aa		43,785		2.1	%		0.7	%
A/A		33,326		1.6	%		0.6	%
BBB		31,663		1.5	%		0.5	%
Below BBB		138,769		6.6	%		2.3	%
Not Rated		525		—			—

Total	$	2,099,027		100.0	%		35.0	%


						Percentage of
Structured securities sectors (RMBS, CMBS, ABS and CDO)	Fair Value		Percentage			Investment Portfolio
Commercial
Agency	$	33,530		1.6	%		0.6	%
Non Agency		560,087		26.7	%		9.3	%
Residential
Agency		966,627		46.1	%		16.1	%
Non Agency		271,376		12.9	%		4.5	%
Consumer
Non Agency		267,407		12.7	%		4.5	%

Total	$	2,099,027		100.0	%		35.0	%

Spread Duration 3.13 years


						Percentage of
Commercial real estate collateralized debt obligations (CRE CDO’s)	Fair Value		Percentage			Investment Portfolio
AAA/Aaa	$	1,280		31.1	%		—
AA/Aa		1,203		29.3	%		—
A/A		657		16.0	%		—
BBB		316		7.7	%		—
Below BBB		653		15.9	%		—

Total	$	4,109		100.0	%		—

Spread Duration 1.68 years

ENDURANCE SPECIALTY HOLDINGS LTD.
LARGEST TWENTY-FIVE CORPORATE HOLDINGS
AS OF SEPT. 30, 2009


	September 30, 2009
	Amortized				Unrealized			Credit
ISSUER (1) (2) (4)	Cost		Fair Value		Gain (Loss)			Quality (3)

VERIZON COMMUNICATIONS INC.	$	29,681	$	30,783	$	1,102		A/A
JPMORGAN CHASE & CO		24,939		24,771		(168	)	AA/Aa
AT&T INC		18,408		19,002		594		A/A
ORACLE CORPORATION		17,645		18,926		1,281		A/A
MORGAN STANLEY		15,585		15,458		(127	)	A/A
NATIONAL GRID PLC		13,954		13,935		(19	)	A/A
WESTPAC BANKING CORP		13,312		13,505		193		AA/Aa
RABOBANK NEDERLAND NV		11,554		13,102		1,548		AAA/Aaa
VODAFONE GROUP PLC		12,183		12,330		147		A/A
FRANCE TELECOM SA		11,549		11,558		9		A/A
ENEL SPA		10,668		10,745		77		A/A
SIEMENS AG		9,374		9,982		608		A/A
DIAGEO PLC		9,486		9,454		(32	)	AA/Aa
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED		6,843		9,420		2,577		A/A
BERKSHIRE HATHAWAY INC.		8,623		9,307		684		A/A
HSBC HOLDINGS PLC		8,734		9,263		529		AA/Aa
ASTRAZENECA PLC		8,178		8,996		818		AA/Aa
CISCO SYSTEMS INC		8,204		8,738		534		A/A
DEERE & CO		8,030		8,560		530		A/A
PEPSI BOTTLING GROUP INC		7,714		8,523		809		A/A
ROYAL BANK OF SCOTLAND GROUP PLC		7,785		7,924		139		AA/Aa
METLIFE INC		7,488		7,713		225		AA/Aa
EDISON INTERNATIONAL INC		7,267		7,051		(216	)	A/A
CATERPILLAR INC		6,034		6,310		276		A/A
PEPSICO INC		5,872		6,238		366		AA/Aa


(1)		Corporate issuers exclude government-backed, government-sponsored enterprises, covered bonds and cash and cash equivalents.

(2)		Credit exposures represent only direct exposure to fixed maturities and short term investments of the parent issuer and its major subsidiaries.

(3)		Represents weighted average credit quality of underlying issues.

(4)		Includes preferred equity securities.

ENDURANCE SPECIALTY HOLDINGS LTD.
ACTIVITY IN RESERVE FOR LOSSES AND LOSS EXPENSES


	Three months ended Sept. 30, 2009									Nine months ended Sept. 30, 2009
	Gross			Recoveries			Net			Gross			Recoveries			Net
Reserve for losses and loss expenses Balance, beginning of period	$	3,264,442		$	(361,605	)	$	2,902,837		$	3,235,456		$	(557,834	)	$	2,677,622


Incurred related to:
Current year		356,513			(110,429	)		246,084			1,152,332			(340,004	)		812,328
Prior years		(54,063	)		19,662			(34,401	)		(172,101	)		62,408			(109,693	)

Total Incurred		302,450			(90,767	)		211,683			980,231			(277,596	)		702,635


Paid related to:
Current year		(208,149	)		634			(207,515	)		(301,754	)		33,071			(268,683	)
Prior years		(116,202	)		(3,205	)		(119,407	)		(668,862	)		348,044			(320,818	)

Total Paid		(324,351	)		(2,571	)		(326,922	)		(970,616	)		381,115			(589,501	)


Foreign currency translation		(1,297	)		(29	)		(1,326	)		(3,827	)		(657	)		(4,484	)


Balance, end of period	$	3,241,244			($454,972	)	$	2,786,272		$	3,241,244			($454,972	)	$	2,786,272

ENDURANCE SPECIALTY HOLDINGS LTD.
PRIOR YEAR RESERVE DEVELOPMENT BY SEGMENT

(FAVORABLE) ADVERSE PRIOR ACCIDENT YEAR DEVELOPMENT FOR THE PERIODS ENDED
SEPT. 30, 2009


							Total			Deposit
							Company			Accounting			Total
	Insurance			Reinsurance			Sub-total			Adjustment [a]			Company

Incurred related to prior years
Quarter ended March 31, 2009		($36,798	)		($2,876	)		($39,674	)		($356	)		($39,318	)
Quarter ended June 30, 2009		(19,842	)		(15,617	)		(35,459	)		515			(35,974	)
Quarter ended September 30, 2009		(13,952	)		(19,900	)		(33,852	)		549			(34,401	)

Nine months ended September 30, 2009		($70,592	)		($38,393	)		($108,985	)	$	708			($109,693	)

(FAVORABLE) ADVERSE PRIOR ACCIDENT YEAR DEVELOPMENT DURING THE YEAR ENDED
DEC. 31, 2008


							Total			Deposit
							Company			Accounting			Total
	Insurance			Reinsurance			Sub-total			Adjustment [a]			Company

Incurred related to prior years
Quarter ended March 31, 2008		($3,743	)		($35,498	)		($39,241	)	$	1,713			($40,954	)
Quarter ended June 30, 2008		(25,583	)		(33,025	)		(58,608	)		(2,426	)		(56,182	)
Quarter ended September 30, 2008		(17,242	)		1,849			(15,393	)		3,051			(18,444	)
Quarter ended December 31, 2008		(24,430	)		(21,971	)		(46,401	)		(5,441	)		(40,960	)

Year ended December 31, 2008		($70,998	)		($88,645	)		($159,643	)		($3,103	)		($156,540	)

(FAVORABLE) ADVERSE PRIOR ACCIDENT YEAR DEVELOPMENT DURING THE YEAR ENDED
DEC. 31, 2007


							Total			Deposit
							Company			Accounting			Total
	Insurance			Reinsurance			Sub-total			Adjustment [a]			Company

Incurred related to prior years
Quarter ended March 31, 2007		($26,507	)		($23,072	)		($49,579	)	$	6,328			($55,907	)
Quarter ended June 30, 2007		(18,725	)		(8,441	)		(27,166	)		423			(27,589	)
Quarter ended Sept. 30, 2007		(25,101	)		(8,112	)		(33,213	)		4,277			(37,490	)
Quarter ended Dec. 31, 2007		(10,080	)		(34,783	)		(44,863	)		(6,462	)		(38,401	)

Year ended December 31, 2007		($80,413	)		($74,408	)		($154,821	)	$	4,566			($159,387	)


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s underwriting results by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
PRIOR YEAR RESERVE DEVELOPMENT BY DEVELOPMENT TAIL

(FAVORABLE) ADVERSE PRIOR ACCIDENT YEAR DEVELOPMENT


																FOR THE
	FOR THE QUARTERS ENDED															YEAR ENDED
	SEPT. 30, 2009			JUNE 30, 2009			MAR. 31, 2009			DEC. 31, 2008			SEPT. 30, 2008			DEC. 31, 2008
INSURANCE SEGMENT
Short tail[a]		($4,039	)		($3,956	)		($13,419	)		($1,749	)		($1,009	)		($12,077	)
Long tail[b]		(9,554	)		(12,778	)		(12,654	)		(17,862	)		(16,233	)		(54,102	)
Other[c]		(359	)		(3,108	)		(10,725	)		(4,819	)		—			(4,819	)

TOTAL INSURANCE		(13,952	)		(19,842	)		(36,798	)		(24,430	)		(17,242	)		(70,998	)


REINSURANCE SEGMENT
Short tail[a]		(11,713	)		(13,878	)		(4,594	)		2,094			1,884			(38,218	)
Long tail[b]		356			937			3,955			(21,610	)		3,140			(17,384	)
Other[c]		(8,543	)		(2,676	)		(2,237	)		(2,455	)		(3,175	)		(33,043	)

TOTAL REINSURANCE		(19,900	)		(15,617	)		(2,876	)		(21,971	)		1,849			(88,645	)


TOTAL COMPANY SUBTOTAL		(33,852	)		(35,459	)		(39,674	)		(46,401	)		(15,393	)		(159,643	)
DEPOSIT ACCOUNTING ADJUSTMENT[d]		549			515			(356	)		(5,441	)		3,051			(3,103	)


REPORTED TOTALS		($34,401	)		($35,974	)		($39,318	)		($40,960	)		($18,444	)		($156,540	)


[a]		Short tail business is that for which development typically emerges within a period of several quarters. The Company’s short tail line of business in the Insurance segment includes its property line of business. The Company’s short tail lines in its Reinsurance segment include property, catastrophe, marine, aerospace and surety.

[b]		Long tail business is that for which development emerges over many years. The Company’s long tail lines of business in the Insurance segment includes casualty, healthcare liability, workers’ compensation and professional lines. The Company’s long tail line of business in the Reinsurance segment includes casualty.

[c]		The Company writes certain specialty lines of business for which the loss emergence is considered to be unique in nature and thus, has been included as other. The Company’s other lines of business included in the Insurance segment is agriculture and in the Reinsurance segment are agriculture, personal accident, self insured risks and special accounts.

[d]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s underwriting results by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.
ANALYSIS OF UNPAID LOSSES AND LOSS EXPENSES


																												Deposit
	Insurance												Reinsurance												Total			Accounting			Reported
	Short Tail			Long Tail			Other			Total			Short Tail			Long Tail			Other			Total			Company			Adjustment [a]			Totals
AT SEPT. 30, 2009
Case reserves	$	36,609		$	278,204		$	225,816		$	540,629		$	365,702		$	260,182		$	7,466		$	633,350		$	1,173,979			($20,408	)	$	1,153,571
Total reserves	$	73,478		$	1,379,446		$	273,189		$	1,726,113		$	647,730		$	847,075		$	66,128		$	1,560,933		$	3,287,046			($45,802	)	$	3,241,244

Case reserves / Total reserves		49.8	%		20.2	%		82.7	%		31.3	%		56.5	%		30.7	%		11.3	%		40.6	%		35.7	%		44.6	%		35.6	%

IBNR / Total reserves		50.2	%		79.8	%		17.3	%		68.7	%		43.5	%		69.3	%		88.7	%		59.4	%		64.3	%		55.4	%		64.4	%


AT JUNE 30, 2009
Case reserves	$	45,383		$	276,174		$	237,697		$	559,254		$	385,626		$	257,721		$	6,767		$	650,114		$	1,209,368			($23,616	)	$	1,185,752
Total reserves	$	86,397		$	1,332,813		$	269,896		$	1,689,106		$	712,463		$	841,137		$	71,486		$	1,625,086		$	3,314,192			($49,750	)	$	3,264,442

Case reserves / Total reserves		52.5	%		20.7	%		88.1	%		33.1	%		54.1	%		30.6	%		9.5	%		40.0	%		36.5	%		47.5	%		36.3	%

IBNR / Total reserves		47.5	%		79.3	%		11.9	%		66.9	%		45.9	%		69.4	%		90.5	%		60.0	%		63.5	%		52.5	%		63.7	%


AT MAR. 31, 2009
Case reserves	$	40,545		$	201,506		$	104,680		$	346,731		$	434,687		$	253,475		$	6,650		$	694,812		$	1,041,543			($23,799	)	$	1,017,744
Total reserves	$	81,451		$	1,293,762		$	201,590		$	1,576,803		$	725,015		$	829,693		$	74,874		$	1,629,582		$	3,206,385			($52,011	)	$	3,154,374

Case reserves / Total reserves		49.8	%		15.6	%		51.9	%		22.0	%		60.0	%		30.6	%		8.9	%		42.6	%		32.5	%		45.8	%		32.3	%

IBNR / Total reserves		50.2	%		84.4	%		48.1	%		78.0	%		40.0	%		69.4	%		91.1	%		57.4	%		67.5	%		54.2	%		67.7	%


AT DEC. 31, 2008
Case reserves	$	59,346		$	163,633		$	250,278		$	473,257		$	463,494		$	239,510		$	6,534		$	709,538		$	1,182,795			($25,860	)	$	1,156,935
Total reserves	$	96,775		$	1,241,728		$	320,354		$	1,658,857		$	740,812		$	818,234		$	74,772		$	1,633,818		$	3,292,675			($57,219	)	$	3,235,456

Case reserves / Total reserves		61.3	%		13.2	%		78.1	%		28.5	%		62.6	%		29.3	%		8.7	%		43.4	%		35.9	%		45.2	%		35.8	%

IBNR / Total reserves		38.7	%		86.8	%		21.9	%		71.5	%		37.4	%		70.7	%		91.3	%		56.6	%		64.1	%		54.8	%		64.2	%


AT SEPT. 30, 2008
Case reserves	$	69,794		$	137,169		$	227,372		$	434,335		$	466,306		$	249,167		$	6,137		$	721,610		$	1,155,945			($25,860	)	$	1,130,085
Total reserves	$	106,050		$	1,194,845		$	302,317		$	1,603,212		$	841,468		$	840,556		$	76,441		$	1,758,465		$	3,361,677			($57,219	)	$	3,304,458

Case reserves / Total reserves		65.8	%		11.5	%		75.2	%		27.1	%		55.4	%		29.6	%		8.0	%		41.0	%		34.4	%		45.2	%		34.2	%

IBNR / Total reserves		34.2	%		88.5	%		24.8	%		72.9	%		44.6	%		70.4	%		92.0	%		59.0	%		65.6	%		54.8	%		65.8	%


[a]		For internal management reporting purposes, underwriting results by segment are presented on the basis of applying reinsurance accounting to all reinsurance contracts written. However, for financial statement presentation purposes, management determined that certain reinsurance contracts written were more appropriately accounted for under the deposit method of accounting whereby net premiums due on such contracts were recorded as deposit liabilities. The adjustment herein reconciles the Company’s underwriting results by segment to the Company’s financial statement presentation.

ENDURANCE SPECIALTY HOLDINGS LTD.

SHAREHOLDER RETURN ANALYSIS


	NINE MONTHS ENDED			YEARS ENDED DECEMBER 31,									INCEPTION TO
	SEPT. 30, 2009			2008			2007			2006			SEPT. 30, 2009
Income and Return on Equity:
Net income available to common and participating common shareholders	$	369,654		$	83,121		$	505,607		$	482,626		$	1,938,894

Operating income available to common and participating common shareholders		355,414			182,539			525,450			485,409			2,043,764

Average Shareholders’ equity[a]		2,257,817			2,159,771			2,205,067			1,885,209			1,817,498

Net income return on average equity		16.4	%		3.8	%		22.9	%		25.6	%		13.8	%[c]
Operating return on average equity		15.7	%		8.5	%		23.8	%		25.7	%		14.5	%[c]


Book value and dividends per share:
Dilutive book value per common share (treasury stock method)	$	42.09		$	33.06		$	35.05		$	28.87		$	42.09
Dividends paid per share		0.75			1.00			1.00			1.00			5.88


Change in diluted book value per common share		27.3	%		(5.7	)%		21.4	%		24.6	%		15.1	%[c]


Total return to common shareholders [b]		29.6	%		(2.8	)%		24.9	%		28.9	%		19.1	%[c]


[a]		Excludes the $200 million liquidation value of the preferred shares.

[b]		Total return to common shareholders is calculated as the change in diluted book value per common share plus dividends paid divided by beginning diluted book value per share.

[c]		Represents average non-compounded annual returns since December 31, 2001.

ENDURANCE SPECIALTY HOLDINGS LTD.
DILUTIVE SHARES FOR EPS CALCULATION — TWO CLASS METHOD

Effective January 1, 2009, the Company adopted new accounting guidance related to the calculation of earnings per share which requires basic and diluted earnings per share to be calculated under the two-class method if there are participating shares. Participating securities include unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents. The Company’s unvested restricted shares issued under its stock compensation plans receive nonforfeitable cash dividends and thus are participating as defined by the new guidance.

The two-class method is an income allocation approach to the calculation of earnings per share. Net income available to common and participating shareholders has been allocated between common and participating shareholders based on their receipt of declared or paid dividends with the remaining amount allocated based on the common and participating shareholders proportional number of shares outstanding. The weighted average number of common and common equivalent shares outstanding excludes participating securities. Basic and Diluted earnings per share are calculated by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding and weighted average common and common equivalent shares outstanding, respectively. Amounts for the periods ended September 30, 2009 and 2008 reflect this change in accounting policy.


		QUARTERS ENDED						NINE MONTHS ENDED
		SEPT. 30,						SEPT. 30,
		2009			2008			2009			2008

DILUTIVE SHARES	Average market price per share	$	33.37		$	31.41		$	28.88		$	35.23
OUTSTANDING:
AS REPORTED	Basic weighted average common shares outstanding⁽¹⁾		55,977			57,570			56,184			58,314

	Add: weighted avg. unvested restricted share units		26			1,198			26			633
	Weighted average exercise price per share		—			—			—			—
	Proceeds from unrecognized restricted share unit expense	$	758		$	22,352		$	758		$	22,352
	Less: restricted share units bought back via treasury method		(23	)		(1,198	)		(26	)		(634	)

	Add: weighted avg. dilutive warrants outstanding		3,197			6,019			3,952			6,483
	Weighted average exercise price per share	$	14.12		$	15.12		$	14.12		$	15.12
	Less: warrants bought back via treasury method		(1,353	)		(6,019	)		(1,932	)		(2,782	)

	Add: weighted avg. dilutive options outstanding		1,947			2,017			1,989			2,031
	Weighted average exercise price per share	$	16.96		$	17.68		$	17.02		$	17.68
	Proceeds from unrecognized option expense	$	19		$	64		$	19		$	64
	Less: options bought back via treasury method		(989	)		(2,017	)		(1,173	)		(1,020	)

	Weighted average dilutive shares outstanding		58,782			57,570			59,020			63,025


Notes:		⁽¹⁾ Excludes unvested restricted shares outstanding which are considered participating securities under the two-class method for calculation of EPS.

ENDURANCE SPECIALTY HOLDINGS LTD.
EARNINGS PER SHARE INFORMATION — TWO CLASS METHOD


	Two-Class Method						Two-Class Method
	QUARTERS ENDED SEPT. 30,						NINE MONTHS ENDED SEPT. 30,
	2009			2008			2009			2008

Net income (loss)	$	153,842			($99,392	)	$	381,279		$	81,757
Less preferred dividends		(3,875	)		(3,875	)		(11,625	)		(11,625	)

Net income (loss) available (attributable) to common and participating common shareholders	$	149,967			($103,267	)	$	369,654		$	70,132

Less amount allocated to participating common shareholders[a]		(2,522	)		2,057			(6,665	)		(1,390	)

Net income (loss) allocated to common shareholders	$	147,445			($101,210	)	$	362,989		$	68,742


Denominator:
Weighted average shares — basic
Outstanding		55,964			57,510			56,161			58,235
Vested restricted share units		13			60			23			79

		55,977			57,570			56,184			58,314


Share Equivalents
Warrants		1,845			—			2,020			3,701
Options		957			—			816			1,010
Restricted share units		3			—			—			—

Weighted average shares — diluted		58,782			57,570			59,020			63,025


Basic earnings (losses) per common share	$	2.63			($1.76	)	$	6.46		$	1.18


Diluted earnings (losses) per common share	$	2.51			($1.79	)[b]	$	6.15		$	1.09


[a]		Represents earnings attributable to holders of unvested restricted shares issued under the Company’s stock compensation plans that are considered participating securities under the new accounting guidance related to the calculation of earnings per share under the two-class method which was effective January 1, 2009. Prior period amounts have been restated when participating securities were deemed to be outstanding and reflected under the two-class method.

[b]		Represents diluted losses per share calculated under the treasury stock method which was the lower of the treasury stock method and the two-class method based on a net loss of $(103,267) and diluted shares outstanding of 57,569,606.

ENDURANCE SPECIALTY HOLDINGS LTD.
OPERATING INCOME RECONCILIATION
EARNINGS PER SHARE INFORMATION — AS REPORTED, GAAP
TWO-CLASS METHOD


	Two-Class Method						Two-Class Method
	QUARTERS ENDED SEPT. 30,						NINE MONTHS ENDED SEPT. 30,
	2009			2008			2009			2008
Net income (loss)	$	153,842			($99,392	)	$	381,279		$	81,757
(Less) Add after-tax items:
Net foreign exchange (gains) losses		(3,634	)		15,400			(30,488	)		12,798
Net realized (gains) losses on investments sales		(2,641	)		5,439			(3,019	)		2,417
Net impairment losses recognized in earnings		497			22,495			19,267			41,039

Operating income (loss) before preferred dividends	$	148,064			($56,058	)	$	367,039		$	138,011
Preferred dividends		(3,875	)		(3,875	)		(11,625	)		(11,625	)

Operating income (loss) available (attributable) to common and participating common shareholders	$	144,189			($59,933	)	$	355,414		$	126,386
Less amount allocated to participating common shareholders[a]		(2,425	)	$	1,194			(6,409	)		(2,452	)

Operating income (loss) allocated to common shareholders	$	141,764			($58,739	)	$	349,005		$	123,934


Weighted average common shares outstanding
Basic		55,977			57,570			56,184			58,314
Dilutive		58,782			57,570			59,020			63,025

Basic per common share data
Net income (loss) allocated to common shareholders	$	2.63			($1.76	)	$	6.46		$	1.18
(Less) Add after-tax items:
Net foreign exchange (gains) losses		(0.06	)		0.27			(0.54	)		0.22
Net realized (gains) losses on investments sales		(0.05	)		0.08			(0.05	)		0.02
Net impairment losses recognized in earnings		0.01			0.39			0.34			0.70

Operating income (loss) allocated to common shareholders	$	2.53			($1.02	)	$	6.21		$	2.12


Diluted per common share data
Net income (loss) allocated to common shareholders	$	2.51			($1.79	)	$	6.15		$	1.09
(Less) Add after-tax items:
Net foreign exchange (gains) losses		(0.07	)		0.27			(0.52	)		0.20
Net realized (gains) losses on investments sales		(0.04	)		0.09			(0.05	)		0.03
Net impairment losses recognized in earnings		0.01			0.39			0.33			0.65

Operating income (loss) allocated to common shareholders	$	2.41			($1.04	)[b]	$	5.91		$	1.97


[a]		Represents earnings attributable to holders of unvested restricted shares issued under the Company’s stock compensation plans that are considered participating securities under the new accounting guidance related to the calculation of earnings per share under the two-class method which was effective January 1, 2009. Prior period amounts have been restated when participating securities were deemed to be outstanding and reflected under the two-class method.

[b]		Represents diluted losses per share calculated under the treasury stock Method which was the lower of the treasury stock method and the two-class method based on a operating loss of $(59,933) and diluted shares outstanding of 57,569,606.

ENDURANCE SPECIALTY HOLDINGS LTD.
DILUTIVE SHARES SENSITIVITY ANALYSIS


DILUTIVE SHARES OUSTANDING
Market Price per Share
$32.00	$	33.00	$	34.00	$	35.00	$	36.00	$	37.00	$	38.00	$	39.00	$	40.00	$	41.00	$	42.00

59,312		59,383		59,450		59,512		59,572		59,628		59,681		59,731		59,779		59,824		59,868

ENDURANCE SPECIALTY HOLDINGS LTD.
BOOK VALUE PER SHARE


		SEPT. 30,						DEC. 31,
		2009			2008			2008

DILUTIVE COMMON SHARES OUTSTANDING:	Price per share at period end	$	36.47		$	30.92		$	30.53
AS-IF CONVERTED [a]	Basic common shares outstanding[b]		55,773			56,597			56,128
	Add: unvested restricted shares and restricted share units		969			1,098			1,120
	Add: dilutive warrants outstanding		2,996			5,595			5,095
	Weighted average exercise price per share	$	14.12		$	15.12		$	14.87
	Add: dilutive options outstanding		1,909			2,012			2,011
	Weighted average exercise price per share	$	16.96		$	17.68		$	17.51

	Book Value[c]	$	2,508,350		$	2,068,717		$	2,007,283
	Add: proceeds from converted warrants		42,304			84,596			75,763
	Add: proceeds from converted options		32,377			35,572			35,213

	Pro forma book value	$	2,583,031		$	2,188,885		$	2,118,259
	Dilutive shares outstanding		61,647			65,302			64,354

	Basic book value per common share	$	44.97		$	36.55		$	35.76
	Diluted book value per common share	$	41.90		$	33.52		$	32.92


DILUTIVE COMMON SHARES OUTSTANDING:	Price per share at period end	$	36.47		$	30.92		$	30.53
TREASURY STOCK METHOD	Basic common shares outstanding[b]		55,773			56,597			56,128
	Add: unvested restricted shares and restricted share units		969			1,098			1,120
	Add: dilutive warrants outstanding		2,996			5,595			5,095
	Weighted average exercise price per share	$	14.12		$	15.12		$	14.87
	Less: warrants bought back via treasury method		(1,160	)		(2,736	)		(2,482	)
	Add: dilutive options outstanding		1,909			2,012			2,011
	Weighted average exercise price per share	$	16.96		$	17.68		$	17.51
	Less: options bought back via treasury method		(888	)		(1,151	)		(1,154	)

	Dilutive shares outstanding		59,599			61,415			60,718

	Basic book value per common share	$	44.97		$	36.55		$	35.76
	Diluted book value per common share	$	42.09		$	33.68		$	33.06


[a]		The as-if converted method assumes that the proceeds received upon exercise of options and warrants will be retained by the Company and the resulting common shares from exercise will remain outstanding.

[b]		Basic common shares includes vested restricted share units.

[c]		Excludes the $200 million liquidation value of the preferred shares.

ENDURANCE SPECIALTY HOLDINGS LTD.
REGULATION G

In presenting the Company’s results, management has included and discussed certain non-GAAP measures. Management believes that these non-GAAP measures, which may be defined differently by other companies, better explain the Company’s results of operations in a manner that allows for a more complete understanding of the underlying trends in the Company’s business. However, these measures should not be viewed as a substitute for those determined in accordance with GAAP.

Operating income is an internal performance measure used by the Company in the management of its operations. Operating income represents after-tax operational results excluding, as applicable, after-tax net realized capital gains or losses and after-tax net foreign exchange gains or losses because the amount of these gains or losses is heavily influenced by, and fluctuates in part, according to the availability of market opportunities. The Company believes these amounts are largely independent of its business and underwriting process and including them distorts the analysis of trends in its operations. In addition to presenting net income determined in accordance with GAAP, the Company believes that showing operating income enables investors, analysts, rating agencies and other users of its financial information to more easily analyze the Company’s results of operations in a manner similar to how management analyzes the Company’s underlying business performance. Operating income should not be viewed as a substitute for GAAP net income. Please see page 34 for a reconciliation of operating income to net income.

Return on Average Equity (ROAE) is comprised using the average common equity calculated as the arithmetic average of the beginning and ending common equity balances for stated periods. Return on Beginning Equity (ROBE) is comprised using the beginning common equity for stated periods. The Company presents various measures of Return on Equity that are commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information.

Investment yield is provided by the Company’s investment managers and is calculated by dividing net investment income by average invested assets at amortized cost. The Company utilizes and presents the investment yield in order to better disclose the performance of the Company’s investments and to show the components of the Company’s ROE.

The Company has included diluted book value per common share because it takes into account the effect of dilutive securities; therefore, the Company believes it is a better measure of calculating shareholder returns than book value per common share. Please see page 36 for a reconciliation of diluted book value per common share to basic book value per common share.

Endurance Specialty (ENH) Inactive 8-KResults of Operations and Financial Condition