776867--2/29/2008--WHITE_MOUNTAINS_INSURANCE_GROUP

related topics

{loss, insurance, financial}

{regulation, change, law}

{operation, international, foreign}

{financial, litigation, operation}

{capital, credit, financial}

{loan, real, estate}

{acquisition, growth, future}

{personnel, key, retain}

{competitive, industry, competition}

{operation, natural, condition}

{debt, indebtedness, cash}

Unpredictable catastrophic events could adversely affect our financial condition or results of operations. We may not be able to successfully alleviate risk through reinsurance and retrocessional arrangements. Additionally, we may be unable to collect all amounts due from our reinsurers under our existing reinsurance and retrocessional arrangements. Our loss reserves may be inadequate to cover our ultimate liability for losses and as a result our financial results could be adversely affected. Loss and Loss Adjustment Expenses We may not maintain favorable financial strength or creditworthiness ratings which could adversely affect our ability to conduct business. Our debt, preferred stock and related service obligations could adversely affect our business. Our investment portfolio may suffer reduced returns or losses which could adversely affect our results of operations and financial condition. Any increase in interest rates or volatility in the equity and debt markets could result in significant losses in the fair value of our investment portfolio. The property and casualty insurance and reinsurance industries are highly competitive and we may not be able to compete effectively in the future. We may suffer losses from unfavorable outcomes from litigation and other legal proceedings. Regulation may restrict our ability to operate. In recent years we have successfully created shareholder value through acquisitions and dispositions of insurance and reinsurance entities. We may not be able to continue to create shareholder value through such transactions in the future. We may become subject to taxes in Bermuda after 2016. Changes in tax laws or tax treaties may cause more of the income of certain non-U.S. companies in our group to become subject to taxes in the United States. We have significant foreign operations that expose us to certain additional risks, including foreign currency risks and political risk. We depend on our key personnel to manage our business effectively and they may be difficult to replace. Bermuda law differs from the laws in effect in the United States and may afford less protection to shareholders. The reinsurance business historically has been cyclical and, in the future, we expect to experience periods with excess underwriting capacity and unfavorable premium rates, terms and conditions. We are largely dependent upon our ceding companies' evaluation of risk. We have surety bonds in Latin America and write credit and bond reinsurance that could expose us to an economic downturn, or changes to the regulatory or legal environment, in certain countries and regions as a whole.

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776867--2/29/2008--WHITE_MOUNTAINS_INSURANCE_GROUP_LTD