Exhibit 11.1 EVEREST REINSURANCE HOLDINGS, INC. COMPUTATION OF EARNINGS PER SHARE FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1998 AND 1997 (Dollars in thousands) Three Months Ended Six Months Ended June 30, June 30, --------------------------- --------------------------- 1998 1997 1998 1997 ------------ ------------ ------------ ------------ Net Income (Numerator) $ 43,544 $ 44,338 $ 83,345 $ 78,802 ============ ============ ============ ============ Weighted average common and effect of dilutive shares used in the computation of net income per share: Average shares outstanding - basic (denominator) 50,479,901 50,469,367 50,480,627 50,479,879 Effect of dilutive shares: Options outstanding 310,130 267,545 313,928 249,480 Options exercised 27 330 283 495 Options cancelled 9,210 1,138 4,605 1,284 ------------ ------------ ------------ ------------ Average share outstanding - diluted (denominator) 50,799,268 50,738,380 50,799,443 50,731,138 Net Income per common share: Basic $ 0.86 $ 0.88 $ 1.65 $ 1.56 Diluted 0.86 0.87 1.64 1.55