HCC Insurance 10-K/A 2005 FY Annual report (amended)

Exhibit 12

HCC INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

STATEMENT OF RATIOS

	Years ended December 31,
	(in thousands)
	2005			2004			2003			2002			2001
Gross premium to surplus ratio:
Gross written premium	$	2,049,116		$	1,992,361		$	1,746,413		$	1,163,397		$	1,014,833
Policyholders’ surplus		1,110,268			844,851			591,889			523,807			401,393
Premium to surplus ratio (1)		184.6	%		235.8	%		295.1	%		222.1	%		252.8	%
(Gross premium to surplus ratio = gross written premium divided by policyholders’ surplus)
Net premium to surplus ratio:
Net written premium	$	1,495,931		$	1,121,343		$	867,795		$	545,475		$	371,409
Policyholders’ surplus		1,110,268			844,851			591,889			523,807			401,393
Premium to surplus ratio (1)		134.7	%		132.7	%		146.6	%		104.1	%		92.5	%
(Net premium to surplus ratio = net written premium divided by policyholders’ surplus)
Loss ratio:
Incurred loss and loss adjustment expense	$	925,130		$	651,675		$	494,024		$	313,744		$	266,537
Net earned premium		1,378,100			1,013,573			739,376			506,371			341,779
Loss ratio (1)		67.1	%		64.3	%		66.8	%		62.0	%		78.0	%
(Loss ratio = incurred loss and loss adjustment expense divided by net earned premium)
Expense ratio:
Underwriting expense	$	381,680		$	299,789		$	199,927		$	130,578		$	88,461
Net written premium		1,495,931			1,121,343			867,795			545,475			371,409
Expense ratio (1)		25.5	%		26.7	%		23.0	%		23.9	%		23.8	%
(Expense ratio = underwriting expense divided by net written premium)
Combined ratio (1)		92.6	%		91.0	%		89.8	%		85.9	%		101.8	%
(Combined ratio = loss ratio plus expense ratio)

(1) Calculated for our insurance companies using financial data reported in accordance with statutory accounting principles.

HCC INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

STATEMENT OF RATIOS
(continued)

	Years ended December 31,
	(in thousands)
	2005			2004			2003			2002			2001
	(As restated)			(As restated)			(As restated)			(As restated)			(As restated)
Loss ratio:
Incurred loss and loss adjustment expense	$	919,697		$	645,230		$	488,000		$	307,143		$	267,390
Net earned premium		1,369,988			1,010,692			738,272			505,521			342,787
Loss ratio (2)		67.1	%		63.8	%		66.1	%		60.8	%		78.0	%
(Loss ratio = incurred loss and loss adjustment expense divided by net earned premium)
Expense ratio:
Underwriting expense	$	357,727		$	269,390		$	181,637		$	128,938		$	87,052
Net earned premium		1,369,988			1,010,692			738,272			505,521			342,787
Expense ratio (2)		26.1	%		26.7	%		24.6	%		25.5	%		25.4	%
(Expense ratio = underwriting expense divided by net earned premium)
Combined ratio (2)		93.2	%		90.5	%		90.7	%		86.3	%		103.4	%
(Combined ratio = loss ratio plus expense ratio)

(2) Calculated for our insurance companies using financial data reported in accordance with generally accepted accounting principles.