##### Table of Contents









UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


WASHINGTON, D.C. 20549




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FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934


For the fiscal year ended December 31,
2001

Commission file number: 0-27662

IPC Holdings, Ltd.

(Exact name of registrant as specified in its
charter)

|                                                                |  |                                      
|--------------------------------------------------------------- |  | -------------------------------------
|Bermuda                                                         |  | Not Applicable                       
|                                                                |  |                                      
|(State or other jurisdiction of
	incorporation or organization) |  | (I.R.S. Employer
	Identification No.)

American International Building, 29 Richmond
Road, Pembroke, HM 08, Bermuda




(Address of principal executive
offices)


(441) 298-5100




(Registrants telephone number,


including area code)


Securities registered pursuant to
Section 12(b) of the Act: None

Securities registered pursuant to
Section 12(g) of the Act:  Common Shares, par
value $0.01 per share

Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the
past
90 days.  Yes  x     No  o

Indicate by check mark if the disclosure of
delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be
contained, to the best of the Registrants knowledge, in
definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to
this
Form 10-K.  x

The aggregate market value of the
Registrants Common Shares held by non-affiliates of the
Registrant as of March 19, 2002, was $1,140,544,781, based
on the last reported sale price of Common Shares on the Nasdaq
National Market system on that date.

The number of the Registrants Common
Shares, par value U.S. $0.01 per share, as of March 19,
2002, was 48,172,776.

DOCUMENTS INCORPORATED BY REFERENCE

1. Portions of the Registrants 2001 Annual
Report to Shareholders to be mailed to shareholders on or about
April 26, 2002 are incorporated by reference into
Part II of this Form 10-K. With the exception of the
portions of the Annual Report specifically incorporated herein
by reference, the Annual Report is not deemed to be filed as
part of this Form 10-K.

2. Portions of the Registrants definitive
proxy statement to be filed with the Securities and Exchange
Commission pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended (the Exchange Act),
relating to the Registrants Annual Meeting of Shareholders
scheduled to be held June 14, 2002 are incorporated by
reference into Part III of this Form 10-K. With the
exception of the portions of the Proxy Statement specifically
incorporated herein by reference, the Proxy Statement is not
deemed to be filed as part of this Form 10-K.









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TABLE OF CONTENTS



|                                           |                                                                                               |  |  |  |  |  |  | 
|------------------------------------------ | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I                                    
|                                           | Item 1. Business                                                                             
|                                           | Item 2. Properties                                                                           
|                                           | Item 3. Legal Proceedings                                                                    
|                                           | Item 4. Submission of Matters to a Vote of Security Holders                                  
|PART II                                   
|                                           | Item 5. Market for the Registrants Common Stock and Related Shareholder Matters             
|                                           | Item 6. Selected Financial Data                                                              
|                                           | Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                           | Item 7A. Quantitative and Qualitative Disclosures About Market Risk                          
|                                           | Item 8. Financial Statements and Supplementary Data                                          
|                                           | Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 
|PART III                                  
|                                           | Item 10. Directors and Executive Officers                                                    
|                                           | Item 11. Executive Compensation                                                              
|                                           | Item 12. Security Ownership of Certain Beneficial Owners and Management                      
|                                           | Item 13. Certain Relationships and Related Transactions                                      
|PART IV                                   
|                                           | Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K                     
|UNDERWRITING AGENCY AGREEMENT             
|AMENDED SCHEDULE I                        
|CALCULATION OF NET (LOSS) PER COMMON SHARE
|PORTIONS OF ANNUAL REPORT                 
|SUBSIDIARIES OF THE REGISTRANT            
|CONSENT OF ARTHUR ANDERSEN                
|REPRESENTATIONS OF ARTHUR ANDERSEN        



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##### Table of Contents



IPC HOLDINGS, LTD.

TABLE OF CONTENTS

|         |  |                                                                                        |  |  |    | 
|-------- |  | -------------------------------------------------------------------------------------- |  |  | -- | 
|         |  | Page                                                                                  
|Item     |  | Number                                                                                
|         |  |                                                                                       
|PART I  
|        
|1.       |  | Business                                                                               |  |  | 2  | 
|2.       |  | Properties                                                                             |  |  | 21 | 
|3.       |  | Legal Proceedings                                                                      |  |  | 21 | 
|4.       |  | Submission of Matters to a Vote of Security
	Holders                                   |  |  | 21 | 
|PART II 
|        
|5.       |  | Market for the Registrants Common Stock and
	Related Shareholder Matters              |  |  | 21 | 
|6.       |  | Selected Financial Data                                                                |  |  | 23 | 
|7.       |  | Managements Discussion and Analysis of
	Financial Condition and Results of Operations |  |  | 24 | 
|7A.      |  | Quantitative & Qualitative Disclosures about
	Market Risk                              |  |  | 24 | 
|8.       |  | Financial Statements and Supplementary Data                                            |  |  | 24 | 
|9.       |  | Changes in and Disagreements with Accountants on
	Accounting and Financial Disclosure  |  |  | 24 | 
|PART III
|        
|10.      |  | Directors and Executive Officers                                                       |  |  | 24 | 
|11.      |  | Executive Compensation                                                                 |  |  | 24 | 
|12.      |  | Security Ownership of Certain Beneficial Owners
	and Management                        |  |  | 24 | 
|13.      |  | Certain Relationships and Related Transactions                                         |  |  | 24 | 
|PART IV 
|14.      |  | Exhibits, Financial Statement Schedules and
	Reports on Form 8-K                       |  |  | 25 | 

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PART I

Special Note Regarding Forward-Looking
Information

This report contains certain forward-looking
statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements are statements other than historical information or
statements of current condition, including but not limited to
expectations regarding the impact of the terrorist attacks on
the U.S. of September 11 on our results of operations, our
business plan, the insurance and reinsurance market response and
increases in demand for reinsurance. Some forward-looking
statements may be identified by use of terms such as
believes,, anticipates,
intends, or expects, and relate to our
plans and objectives for future operations. In light of the
risks and uncertainties inherent in all forward-looking
statements, the inclusion of such statements in this report
should not be considered as a representation by us or any other
person that our objectives or plans will be achieved. Numerous
factors could cause our actual results to differ materially from
those in the forward-looking statements, including, but not
limited to the following: (i) the occurrence of natural or
man-made catastrophic events with a frequency or severity
exceeding our estimates; (ii) any lowering or loss of one
of the financial ratings of IPC Holdings wholly owned
subsidiary, IPCRe Limited, a company incorporated under the laws
of Bermuda (IPCRe and together with the Company,
IPCRe Europe (as defined herein) and IPCRe Underwriting Services
(as defined herein), we or IPC);
(iii) a decrease in the level of demand for property
catastrophe reinsurance, or increased competition owing to
increased capacity of property catastrophe reinsurers;
(iv) loss of our non-admitted status in United States
jurisdictions or the passage of federal or state legislation
subjecting us to supervision or regulation in the United States;
(v) the impact of the September 11 terrorist attacks
and their aftermath on our reinsureds, on the insurance and
reinsurance industry and on the future coverage for terrorist
acts and on the economy in general, and potential governmental
intervention in the insurance and reinsurance industry in the
aftermath of the September 11 terrorist attacks;
(vi) further development of losses from the terrorist
attacks on September 11; (vii) loss of services of any
one of our executive officers; (viii) challenges by
insurance regulators in the United States to our claim of
exemption from insurance regulation under current laws;
(ix) a contention by the United States Internal Revenue
Service that IPC Holdings or IPCRe is engaged in the conduct of
a trade or business within the U.S.; or (x) changes in
exchange rates and greater than expected currency exposure.




Item 1.  Business

General Development of the Business

We provide property catastrophe reinsurance and,
to a limited extent, marine, aviation, property per risk excess
and other short-tail property reinsurance on a worldwide basis.
During 2001, approximately 88% of our gross premiums written
covered property catastrophe risks. Property catastrophe
reinsurance covers unpredictable events such as hurricanes,
windstorms, hailstorms, earthquakes, volcanic eruptions, fires,
industrial explosions, freezes, riots, floods and other man-made
or natural disasters. Most of the reinsurance written by IPCRe
has been, and continues to be, written on an excess of loss
basis for primary insurers rather than reinsurers, and is
subject to aggregate limits on exposure to losses. During 2001,
we had approximately 216 clients, including many of the leading
insurance companies around the world. Approximately 48% of our
clients in 2001 were based in the United States, and
approximately 44% of gross premiums written during 2001 related
primarily to U.S. risks. Our non-U.S. clients and covered risks
are located principally in Europe, Japan and Australia/ New
Zealand. At December 31, 2001, IPC Holdings had total
shareholders investment of $1,106 million and total
assets of $1,302 million.

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In response to a severe imbalance between the
global supply of and demand for property catastrophe reinsurance
that developed in the period from 1989 through 1993, IPC
Holdings and IPCRe were formed and commenced operations in
July 1993 through the sponsorship of American International
Group, Inc. (AIG), a holding company incorporated in
Delaware which, through its subsidiaries, is primarily engaged
in a broad range of insurance and insurance-related activities
and financial services in the United States and abroad. AIG
purchased 24.4% of IPC Holdings initial share capital and
an option (which was exercisable in specified conditions) to
obtain up to an additional 10% (on a fully diluted basis,
excluding employee stock options) of our share capital (the
AIG Option). Since our formation, subsidiaries of
AIG have provided administrative, investment management and
custodial services to us, and the Chairman of the Boards of
Directors of IPC Holdings and IPCRe is also a director and
officer of various subsidiaries and affiliates of AIG. See
Item 13. Certain Relationships and Related
Transactions. For discussion of the limitation of voting
rights of any 10% or more beneficial owner of Common Shares
(including AIG) to less than 10% of total voting rights, see
Amendment No. 1 to the Companys Registration
Statement on Form 8-A, dated February 9, 1996.

On March 13, 1996, IPC Holdings completed an
initial public offering in which 13,521,739 of the 25,000,000
Common shares outstanding, were sold by existing shareholders.
IPC Holdings Common Shares are included for trading on the
Nasdaq National Market under the ticker symbol IPCR.

On September 10, 1998, IPCRe incorporated a
subsidiary in Ireland, named IPCRe Europe Limited. Effective
October 1, 1998, IPCRe Europe commenced underwriting
selected reinsurance business in Europe. Currently, IPCRe Europe
retrocedes 90% of the business it underwrites to IPCRe. IPCRe
Services Limited, a subsidiary of IPC Holdings, Ltd., was
established in the United Kingdom, from which European marketing
efforts were conducted on behalf of IPCRe and IPCRe Europe.
IPCRe Services ceased operations in January, 2000, and was
struck off the Register of Companies in December 2001.

On November 7, 2001, IPC Holdings
incorporated a subsidiary in Bermuda named IPCRe Underwriting
Services Limited. (IPCUSL), which is licensed as an
Underwriting Agent, and currently acts for Allied World
Assurance Company Ltd., a Bermuda-based Class 4 insurer
(see Note 9 to the Consolidated Financial
Statements  Related Party Transactions).

On December 12, 2001, we completed a
follow-on public offering in which 17,480,000 ordinary shares
were sold (including the exercise of the over-allotment option
of 2,280,000 shares) at $26.00 per share. Concurrent with the
offering, we sold 2,867,000 shares in a private placement to AIG
at a price equal to the public offering price. Furthermore, AIG
exercised its option referred to above, which had been granted
at the time of the Companys formation, whereby they
acquired 2,775,000 shares at an exercise price of $12.7746 per
share. Total net proceeds raised from these transactions were
approximately $546 million. AIG has informed us that AIG
presently intends to continue its share ownership in the Company
for the foreseeable future.

Recent Industry Developments

After an extended period of eroding premiums and
increased competition, the property catastrophe reinsurance
market began experiencing improvements in rates, terms and
conditions in the fourth quarter of 2000. These improvements in
rates, terms and conditions continued throughout 2001 and were
accelerated by the terrorist attacks of September 11, which
resulted in estimated losses to the insurance industry of
between $30 and $70 billion, the largest estimated
catastrophe losses ever experienced by the industry. These
losses include life, liability, workers compensation and other
coverages that we do not write, in addition to property
catastrophe reinsurance losses. By comparison, the largest
insured catastrophic event prior to the September 11
terrorist attacks was Hurricane Andrew at approximately
$20 billion in estimated losses. We believe property
catastrophe reinsurance premiums have often risen in the
aftermath of significant catastrophic losses. As claims are
reserved, industry surplus is depleted and the industrys
capacity to write new business diminishes. We believe that
market trends similar to those that have occurred in past cycles
are developing in the current environment.

In subsequent renewals, primarily effective
January 1, 2002, the coverage of claims that are the result
of terrorist acts (as defined by industry and government
standards) have been generally excluded from property

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catastrophe reinsurance contracts in respect of
large commercial risks. Such coverage has not been excluded for
personal lines or other coverages.


Business Strategy

Our principal strategy is to provide property
catastrophe excess of loss reinsurance programs to a
geographically diverse, worldwide clientele of primary insurers
with whom we maintain long-term relationships. Under excess of
loss contracts, we begin paying losses when our customers
claims from a particular catastrophic event exceed a specified
amount (known as an attachment point), and our maximum liability
is capped at an amount specified in our reinsurance contacts. To
a lesser extent, we also seek to provide these clients with
other excess of loss short-tail property reinsurance products.
On a limited basis, we provide similar reinsurance programs and
products to reinsurers. We periodically consider underwriting
additional lines of property/casualty coverage, including on a
non-excess of loss basis, provided losses can be limited in a
manner comparable to that described below.

The primary elements of our strategy include:

Disciplined Risk Management.We seek to limit and diversify our
loss exposure through six principal mechanisms: (i) writing
substantially all of our premiums on an excess of loss basis,
which limits our ultimate exposure per contract and permits us
to determine and monitor our aggregate loss exposure;
(ii) adhering to maximum limitations on reinsurance
accepted in defined geographical zones; (iii) limiting
program size for each client in order to achieve diversity
within and across geographical zones; (iv) administering
risk management controls appropriately weighted with our
modeling techniques, as well as our assessment of qualitative
factors (such as the quality of the cedents management and
capital and risk management strategy); (v) utilizing a
range of attachment points for any given program in order to
balance the risks assumed with the premiums written; and
(vi) prudent underwriting of each program written.
Historically, we have declined to renew existing business if the
terms were unfavorable or if the exposure would violate any of
these limitations. We underwrite only those risks we are willing
to bear, utilizing a minimal amount of retrocessional
protection. Therefore, we retain most of the risk in the
reinsurance contracts we write and pay little in retrocession
premiums.

Capital-Based Exposure Limits.Each year, we establish maximum
limitations on reinsurance accepted in defined geographic zones
on the basis of, and as a proportion of, shareholders
investment.

Client Selection and Profile.We believe that establishing
long-term relationships with insurers who have sound capital and
risk management strategies is key to creating long-term value
for our shareholders. We have successfully attracted customers
that are generally sophisticated, long-established insurers who
desire the assurance not only that claims will be paid, but that
reinsurance will continue to be available after claims have been
paid. We believe our financial stability and growth of capital
are essential for creating and maintaining these long-term
relationships.

Capital Management and Shareholder Returns.We manage our capital relative to
our risk exposure in an effort to maximize sustainable long-term
growth in shareholder value, while recognizing that catastrophic
losses will adversely impact short-term financial results from
time to time. We seek growth of our capital to protect it from
major catastrophes, to ensure ongoing customer relationships and
to support premium growth opportunities.

Disciplined Investment Management.In light of the risks of our
underwriting business, our primary investment strategy is
capital preservation. Current investment guidelines permit
investments in equities up to a maximum of 20% of the total
portfolio, and our fixed maturity investments are substantially
limited to the top three investment grades or the equivalent
thereof, at the time of purchase. At December 31, 2001 our
equity investments consisted of shares of stock in the companies
which comprise the Standard & Poors
(S & P) 500 Index, and a global equity
fund managed by a subsidiary of AIG. The investment in such
equities represented 12.9% of the total investment portfolio on
that date. At December 31, 2001, 92.6% of the fixed
maturity portfolio consisted of cash and cash equivalents,
U.S. Treasuries or other government agency issues and
investments with an AAA or AA rating.

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Business

General.We
provide treaty reinsurance principally to insurers of personal
and commercial property worldwide. Treaty reinsurance is
reinsurance of a specified type or category of risk defined in a
contract. As described below, we write substantially all
reinsurance on an excess of loss basis. Our property catastrophe
reinsurance coverages, which accounted for 88% of our gross
premiums written during 2001, are generally all-risk
in nature, subject to various policy exclusions. Our predominant
exposure under such coverages is to property damage from
unpredictable events such as hurricanes, windstorms, hailstorms,
earthquakes and volcanic eruptions, although we are also exposed
to losses from sources as diverse as freezes, riots, floods,
industrial explosions, fires, and other man-made or natural
disasters. The balance of premiums written are derived from
marine, aviation, property per risk excess and other short-tail
property reinsurance. In accordance with market practice, our
property catastrophe reinsurance coverage generally excludes
certain risks such as war, pollution, nuclear contamination and
radiation.

Because we underwrite property catastrophe
reinsurance and have large aggregate exposures to natural and
man-made disasters, our loss experience generally has included
and will continue to include infrequent events of great
severity. Consequently, the occurrence of losses from
catastrophic events has caused and is likely to continue to
cause our financial results to be volatile. In addition, because
catastrophes are an inherent risk of our business, a major event
or series of events, such as occurred during 1998, 1999 and
2001, can be expected to occur from time to time. In the future,
such events could have a material adverse effect on our
financial condition or results of operations, possibly to the
extent of eliminating our shareholders investment.
Increases in the values and concentrations of insured property
and the effects of inflation have resulted in increased severity
of industry losses in recent years, and we expect that those
factors will increase the severity of catastrophe losses per
year in the future.

We currently seek to limit our loss exposure
principally by offering substantially all of our products on an
excess of loss basis, adhering to maximum limitations on
reinsurance accepted in defined geographic zones, limiting
program size for each client and prudent underwriting of each
program written. In addition, our policies contain limitations
and exclusions from coverage and choice of forum. There can be
no assurance that our efforts to limit exposure by using the
foregoing methods will be successful. In addition, geographic
zone limitations involve significant underwriting judgments,
including the determination of the area of the zones and the
inclusion of a particular policy within a zones limits.
Underwriting is inherently a matter of judgment, involving
important assumptions about matters that are inherently
unpredictable and beyond our control, and for which historical
experience and probability analysis may not provide sufficient
guidance.

The effect of potential U.S. and other
governmental intervention on the insurance and reinsurance
markets we serve, including the extent to which coverage for
terrorist acts is offered by the insurance and reinsurance
markets in the future, is uncertain. Coverage for losses
resulting from terrorist acts is currently being offered
separately by some segments of the insurance and reinsurance
markets, and we may or may not offer such coverage in future. As
a result of these uncertainties, we could potentially incur
large unexpected losses if terrorist attacks occur in the future.

Excess of Loss Reinsurance Contracts.Our policy is to write most of our
business within excess of loss reinsurance contracts. Such
contracts provide a defined limit of liability, permitting us to
quantify our aggregate maximum loss exposure. By contrast,
maximum liability under pro rata contracts is more difficult to
quantify precisely. Quantification of loss exposure is
fundamental to our ability to manage our loss exposure through
geographical zone limits and the program limits described below.
Excess of loss contracts also help us to control our
underwriting results by increasing our flexibility to determine
premiums for reinsurance at specific retention levels,
independent of the premiums charged by primary insurers, and
based upon our own underwriting assumptions. In addition,
because primary insurers typically retain a larger loss exposure
under excess of loss contracts, they have a greater incentive to
underwrite risks and adjust losses in a prudent manner.

In addition, we diversify our risk by, to a
limited extent, writing other short-tail property coverages,
including risk excess of loss, marine and aviation. These lines
diversify risk (although they involve some catastrophe exposure)
and thus reduce the volatility in results of operations caused
by catastrophes.

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The following table sets out our gross premiums
written and number of contracts written by type of reinsurance.

|                            |       |                         |         |               |  |           |      |                |   |               |       |           |  |   |        |        |  |  |      |       |   |  |       |       | 
|--------------------------- | ----- | ----------------------- | ------- | ------------- |  | --------- | ---- | -------------- | - | ------------- | ----- | --------- |  | - | ------ | ------ |  |  | ---- | ----- | - |  | ----- | ----- | 
|                            |       |                        
|                            |       | Year ended December 31,
|                            |       |                        
|                            |       |                         |         |              
|                            |       | 2001                    |         | 2000         
|                            |       |                         |         |              
|                            |       |                         |         | Percentage of |  |           |      |                |   | Percentage of |       |          
|                            |       | Premiums                |         | Premiums      |  | Number of |      | Premiums       |   | Premiums      |       | Number of
|Type of Reinsurance Assumed |       | Written                 |         | Written       |  | Contracts |      | Written        |   | Written       |       | Contracts
|                            |       |                         |         |               |  |           |      |                |   |               |       |          
|                            |       | (in thousands)          |         |               |  |           |      | (in thousands) |   |               |       |          
|Catastrophe excess of loss  |       | $                       | 117,293 |               |  |           | 88.2 | %              |   |               | 1,564 |           |  | $ | 79,243 |        |  |  | 84.5 | %     |   |  | 1,676 |      
|Risk excess of loss         |       |                         | 3,220   |               |  |           | 2.4  | %              |   |               | 106   |           |  |   | 4,416  |        |  |  | 4.7  | %     |   |  | 132   |      
|Marine reinsurance          |       |                         | 92      |               |  |           | 0.1  | %              |   |               | 61    |           |  |   | 259    |        |  |  | 0.3  | %     |   |  | 86    |      
|Retrocessional reinsurance  |       |                         | 6,310   |               |  |           | 4.7  | %              |   |               | 71    |           |  |   | 2,676  |        |  |  | 2.9  | %     |   |  | 82    |      
|Aviation(1)                 |       |                         | 5,924   |               |  |           | 4.4  | %              |   |               | 28    |           |  |   | 5,904  |        |  |  | 6.3  | %     |   |  | 25    |      
|Other                       |       |                         | 218     |               |  |           | 0.2  | %              |   |               | 33    |           |  |   | 1,259  |        |  |  | 1.3  | %     |   |  | 51    |      
|                            |       |                         |         |               |  |           |      |                |   |               |       |           |  |   |        |        |  |  |      |       |   |  |       |      
|                            | Total |                         | $       | 133,057       |  |           |      | 100.0          | % |               |       | 1,863     |  |   | $      | 93,757 |  |  |      | 100.0 | % |  |       | 2,052 | 
|                            |       |                         |         |               |  |           |      |                |   |               |       |           |  |   |        |        |  |  |      |       |   |  |       |      




|    |                                                                                                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | In 2001, aviation included one aviation contract
	and two satellite contracts, written on a pro rata basis rather
	than excess of loss. In 2000, aviation included two aviation
	contracts and two satellite contracts, written on a pro rata
	basis. Other aviation contracts were written on an excess of
	loss basis.

Catastrophe Excess of Loss Reinsurance.Catastrophe excess of loss
reinsurance provides coverage to a primary insurer when
aggregate claims and claim expenses from a single occurrence of
a peril, covered under a portfolio of primary insurance
contracts written by the primary insurer, exceed the attachment
point specified in the reinsurance contract with the primary
insurer. The primary insurer can then recover up to the limit of
reinsurance it has elected to buy for each layer. Once a layer
is exhausted by collection of claims, the primary insurer
generally buys another reinsurance layer for the same liability
coverage, i.e., a reinstatement, for an additional premium. Most
of our policies are limited to losses occurring during the
policy term.

Risk Excess of Loss Reinsurance.To a lesser extent, we also write
risk excess of loss property reinsurance. This reinsurance
responds to a loss of the reinsured in excess of its retention
level on a single risk, rather than to aggregate
losses for all covered risks, as does catastrophe reinsurance. A
risk in this context might mean the insurance
coverage on one building or a group of buildings or the
insurance coverage under a single policy which the reinsured
treats as a single risk. Most of the risk excess treaties in
which we participate contain a relatively low loss-per-event
limit on our liability.

Marine Reinsurance.We also write short-tail marine
reinsurance for selected international insurers. Although they
primarily involve property damage, certain marine risks may
involve casualty coverage arising from the same event causing
the property damage. Coverage is solely written on an excess of
loss basis, so events likely to cause a claim will occur less
frequently. Such events might include the destruction of a
drilling platform or damage to a vessel and/or its contents.

Aviation Reinsurance.We also write a small amount of
short-tail aviation reinsurance on proportional and excess of
loss bases. Although they primarily involve property damage,
certain aviation risks may involve casualty coverage arising
from the same event causing the property damage. Coverage is
generally written in excess of a substantial attachment point,
so events likely to cause a claim will occur infrequently but be
relatively severe. In 2001, the majority of this business was
written in a pro rata aviation contract, where the underlying
insurance is written on an excess of loss basis, and two pro
rata satellite contracts.

Policy Features.Historically, our policies have
been written for a one-year period, and generally without
experience-based adjustments. During the period 1997 to 1999,
the trend in the industry was towards multi-year policies. In
particular, some of the insureds renewing policies in 1999
specifically requested longer periods, in part to address
concerns regarding Y2K risks. A proportion of our policies in
1999 were for terms of fifteen to eighteen months. However,
commencing in the second quarter of 1999, we declined renewals
and submissions of new business which were on a multi-year
basis, because of the general inadequacy of market pricing. In
addition, during the same period, the industry offered a variety
of experienced-based incentives such as no claims
bonuses and profit commissions. A proportion of our policies
included some or all of these

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incentives. Because of the improvements in terms
and conditions that have taken place recently, we will consider
writing business on a multi-year basis treaty by treaty.


Underwriting Services.Beginning in December 1,
2001, we commenced providing underwriting services to a
multi-line insurance and reinsurance company in which AIG owns a
23.4% ownership interest. (See Note 9 to the Consolidated
Financial Statements  Related Party Transactions.)

Geographic Diversification

Since inception, we have sought to diversify our
exposure across geographic zones around the world in order to
obtain the optimum spread of risk. We divide our markets into
geographic zones and limit coverage we are willing to provide
for any risk located in a particular zone, so as to maintain our
aggregate loss exposure from all contracts covering risks
believed to be located in that zone, to a predetermined level.

The predetermined levels are established annually
on the basis of, and as a proportion of, shareholders
investment. If a proposed reinsurance program would cause the
limit then in effect to be exceeded, the program would be
declined, regardless of its desirability, unless we utilize
retrocessional coverage (i.e., IPC purchasing reinsurance, such
as our proportional reinsurance facility), thereby reducing the
net aggregate exposure to the maximum limit permitted, or less.
If we were to suffer a net financial loss in any fiscal year,
thus reducing shareholders investment, the limits per zone
would be reduced in the next year, with the possible effect that
we would thereafter reduce existing business in a zone exceeding
such limit.

Currently, we have divided the United States into
8 geographic zones and our other markets, including Europe and
Japan into a total of 18 zones. We designate as zones
geographic areas which, based on historic catastrophe loss
experience reflecting actual catastrophe events and property
development patterns, we believe are most likely to absorb a
large percentage of losses from one catastrophic event. These
zones are determined using computer modeling techniques and
underwriting assessments. The zones may overlap and vary in size
with the level of population density and commercial development
in a particular area. The zones with the greatest exposure
written are in the United States in particular the Atlantic and
North-Central regions, and the United Kingdom. The parameters of
these geographic zones are subject to periodic review and change.

We recognize that events may affect more than one
zone, and to the extent we have accepted reinsurance from a
ceding insurer with a loss exposure in more than one zone, we
will consider such potential loss in testing its limits in all
such affected zones. For example, the program for a
U.S. national carrier typically will be subject to limits
in each U.S. zone. A program with worldwide exposure will also
be subject to limits in U.S. zones or other zones around the
world, as applicable. This results in very substantial
double-counting of exposures in determining
utilization of an aggregate within a given zone. Consequently,
the total sum insured will be less than the sums of utilized
aggregates for all of the zones.

7



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The following table sets out gross premiums
written, number of written contracts and the percentage of our
premiums allocated to the zones of coverage exposure.

|                                  |       |                         |        |               |  |           |      |                |   |               |     |           |  |   |        |        |  |  |      |       |   |  |     |       | 
|--------------------------------- | ----- | ----------------------- | ------ | ------------- |  | --------- | ---- | -------------- | - | ------------- | --- | --------- |  | - | ------ | ------ |  |  | ---- | ----- | - |  | --- | ----- | 
|                                  |       |                        
|                                  |       | Year ended December 31,
|                                  |       |                        
|                                  |       |                         |        |              
|                                  |       | 2001                    |        | 2000         
|                                  |       |                         |        |              
|                                  |       |                         |        | Percentage of |  |           |      |                |   | Percentage of |     |          
|                                  |       | Premiums                |        | Premiums      |  | Number of |      | Premiums       |   | Premiums      |     | Number of
|Geographic Area(1)                |       | Written                 |        | Written       |  | Contracts |      | Written        |   | Written       |     | Contracts
|                                  |       |                         |        |               |  |           |      |                |   |               |     |          
|                                  |       | (in thousands)          |        |               |  |           |      | (in thousands) |   |               |     |          
|United States                     |       | $                       | 57,971 |               |  |           | 43.6 | %              |   |               | 729 |           |  | $ | 39,107 |        |  |  | 41.7 | %     |   |  | 806 |      
|Worldwide(2)                      |       |                         | 22,165 |               |  |           | 16.7 | %              |   |               | 184 |           |  |   | 14,992 |        |  |  | 16.0 | %     |   |  | 227 |      
|Worldwide (excluding the U.S.)(3) |       |                         | 5,758  |               |  |           | 4.3  | %              |   |               | 114 |           |  |   | 4,827  |        |  |  | 5.2  | %     |   |  | 104 |      
|Europe (including the U.K.)       |       |                         | 26,435 |               |  |           | 19.9 | %              |   |               | 412 |           |  |   | 19,144 |        |  |  | 20.4 | %     |   |  | 444 |      
|Japan                             |       |                         | 7,383  |               |  |           | 5.5  | %              |   |               | 68  |           |  |   | 4,175  |        |  |  | 4.5  | %     |   |  | 71  |      
|Australia/ New Zealand            |       |                         | 5,701  |               |  |           | 4.3  | %              |   |               | 120 |           |  |   | 5,188  |        |  |  | 5.5  | %     |   |  | 134 |      
|Other                             |       |                         | 7,644  |               |  |           | 5.7  | %              |   |               | 236 |           |  |   | 6,324  |        |  |  | 6.7  | %     |   |  | 266 |      
|                                  |       |                         |        |               |  |           |      |                |   |               |     |           |  |   |        |        |  |  |      |       |   |  |     |      
|                                  | Total |                         | $      | 133,057       |  |           |      | 100.0          | % |               |     | 1,863     |  |   | $      | 93,757 |  |  |      | 100.0 | % |  |     | 2,052 | 
|                                  |       |                         |        |               |  |           |      |                |   |               |     |           |  |   |        |        |  |  |      |       |   |  |     |      




Notes:




|    |                                                                                                                                               
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Except as otherwise noted, each of these
	categories includes contracts that cover risks primarily located
	in the designated geographic area.
|   
|   
|(2) | Includes contracts that cover risks primarily in
	two or more countries, including the United States.                                         
|   
|   
|(3) | Includes contracts that cover risks primarily in
	two or more countries, excluding the United States.                                         

The following table sets out our gross aggregate
in-force liability allocated to various zones of coverage
exposure at January 1, 2002 and 2001. Our aggregate limits
will be reduced to the extent that business is ceded to the
proportional reinsurance facility (see Retrocessional
Reinsurance below).

|                                     |               |                         |         |                |         |  |         |         |         | 
|------------------------------------ | ------------- | ----------------------- | ------- | -------------- | ------- |  | ------- | ------- | ------- | 
|                                     |               |                        
|                                     |               | Aggregate Limit of     
|                                     |               | Liability at January 1,
|                                     |               |                        
|Geographic Area                      |               | 2002                    |         | 2001          
|                                     |               |                         |         |               
|                                     |               | (in thousands)          |         | (in thousands)
|United States                        |               |                         |         |                |         |  |         |        
|                                     | New England   |                         | $       | 593,260        |         |  | $       | 277,817 |        
|                                     | Atlantic      |                         |         | 633,586        |         |  |         | 314,165 |        
|                                     | Gulf          |                         |         | 580,236        |         |  |         | 303,091 |        
|                                     | North Central |                         |         | 602,012        |         |  |         | 291,484 |        
|                                     | Mid West      |                         |         | 593,876        |         |  |         | 307,440 |        
|                                     | West          |                         |         | 576,904        |         |  |         | 294,937 |        
|                                     | Alaska        |                         |         | 267,878        |         |  |         | 116,153 |        
|                                     | Hawaii        |                         |         | 263,584        |         |  |         | 121,979 |        
|                                     |               | Total United States(1)  |         |                | 723,677 |  |         |         | 434,111 | 
|Canada                               |               |                         | 78,510  |                |         |  | 49,679  |        
|Worldwide(2)(3)                      |               |                         | 67,488  |                |         |  | 65,814  |        
|Worldwide (excluding the U.S.)(2)(4) |               |                         | 91,052  |                |         |  | 75,341  |        
|Europe (including U.K.)              |               |                         | 637,814 |                |         |  | 274,708 |        
|Japan                                |               |                         | 124,071 |                |         |  | 83,830  |        
|Australia/New Zealand(2)             |               |                         | 86,122  |                |         |  | 69,684  |        
|Other                                |               |                         | 131,664 |                |         |  | 48,613  |        

8



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Notes:




|    |                                                                                                                                                                                                                                                                       
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The United States in aggregate is not a zone. The
	degree of double-counting in the 8 U.S. zones
	is illustrated by the relation of the aggregate in-force limit
	of liability for the United States compared to the individual
	limits of liability in the 8 zones.
|   
|   
|(2) | Except as otherwise noted, each of these
	aggregates includes contracts that cover risks located primarily
	in the designated geographic area.                                                                                                                        
|   
|   
|(3) | Includes contracts that cover risks primarily in
	two or more countries, including the United States.                                                                                                                                                                 
|   
|   
|(4) | Includes contracts that cover risks primarily in
	two or more countries, excluding the United States.                                                                                                                                                                 

The effectiveness of geographic zone limits in
managing risk exposure depends on the degree to which an actual
event is confined to the zone in question and on our ability to
determine the actual location of the risks believed to be
covered under a particular reinsurance program. Accordingly,
there can be no assurance that risk exposure in any particular
zone will not exceed that zones limits.

With respect to U.S. exposures, we use the
computer-based systems described below as one tool in estimating
the aggregate losses that could occur under all our contracts
covering U.S. risks as a result of a range of potential
catastrophic events. By evaluating the effects of various
potential events, we monitor whether the risks that could be
accepted within a zone are appropriate in light of other risks
already affecting such zone and, in addition, whether the level
of our zone limits is acceptable.

Underwriting and Program Limits

In addition to geographic zones, we seek to limit
our overall exposure to risk by pursuing a disciplined
underwriting strategy which limits the amount of reinsurance we
will supply in accordance with a particular program or contract,
so as to achieve diversification within and across geographical
zones. Commencing January 2002, we maintain program limits
of $50 million and contract limits of $10 million.
Previously, program limits and contract limits were
$25 million and $5 million, respectively. In a small
number of instances we have exceeded these limits. We also
attempt to distribute our exposure across a range of attachment
points i.e., the amount of claims that have to be borne by the
ceding insurer before our reinsurance coverage applies.
Attachment points vary and are based upon an assessment of the
ceding insurers market share of property perils in any
given geographic zone to which the contract relates, as well as
the capital needs of the ceding insurer.

Prior to reviewing any program proposal, we
consider the appropriateness of the cedent, including the
quality of its management and its capital and risk management
strategy. In addition, we require that each proposed reinsurance
program received includes information on the nature of the
perils to be included and detailed aggregate information as to
the location or locations of the risks covered under the
catastrophe contract. Additional information would also include
the cedents loss history for the perils being reinsured,
together with relevant underwriting considerations which would
impact exposures to catastrophe reinsurers. We first evaluate
exposures on new programs in light of the overall zone limits in
any given catastrophe zone, together with program limits and
contract limits, to ensure a balanced and disciplined
underwriting approach. If the program meets all these initial
underwriting criteria, we then evaluate the proposal in terms of
its risk/reward profile to assess the adequacy of the proposed
pricing and its potential impact on our overall return on
capital. Once a program meets our requirements for underwriting
and pricing, the program would then be authorized for acceptance.

We extensively use sophisticated modeling and
other technology in our underwriting techniques. Each submission
received is registered on the GENIUS reinsurance
data system we use for both underwriting and aggregate control
purposes. This system enables both management and underwriters
to have on-line information regarding both individual exposures
and zonal aggregate concentrations. All submissions are recorded
to determine and monitor their status as being pending,
authorized, or bound.

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In addition to the reinsurance data system, we
use computer modeling to measure and estimate loss exposure
under both simulated and actual loss scenarios and in comparing
exposure portfolios to both single and multiple events. Since
1993, we have contracted Applied Insurance Research for the use
of CATMAP®/2 as part of our modeling approach. These
computer-based loss modeling systems utilize A.M. Bests
data and direct exposure information obtained from our clients,
to assess each clients catastrophe management approach and
adequacy of their programs protection. Modeling is part of
the underwriting criteria for catastrophe exposure pricing. The
majority of our client base also use one or more of the various
modeling consulting firms in their exposure management analysis.
In addition, we sometimes perform or contract for additional
modeling analysis when reviewing our major commitments. The
combination of reinsurance system information, together with
CATMAP®/2 modeling, enables us to monitor and control our
acceptance of exposure on a global basis.

Generally, the proposed terms of coverage,
including the premium rate and retention level for excess of
loss contracts, are set by the lead reinsurer and agreed to by
the client and broker. On placements requiring large market
capacity, typically the broker strives to achieve a consensus of
proposed terms with many participating underwriters to ensure
placement. On both U.S. and non-U.S. business, we act in many
cases as a lead or consensus lead reinsurer. When not the lead,
we sometimes actively negotiate additional terms or conditions.
If we elect to authorize a participation, the underwriter will
specify the percentage or monetary participation in each layer,
and will execute a slip to be followed by a contract to
formalize coverage.

We have a procedure for underwriting control to
ensure that all acceptances are made in accordance with our
underwriting policy and aggregate control. Each underwriting
individual is given an underwriting authority, limits above
which must be submitted for approval to the Chief Executive
Officer. All new acceptances are reviewed at least weekly by the
Chief Executive Officer.

Generally, about 60% of premiums we write each
year are for contracts which have effective dates in January,
about 20% in April, about 10% in July and the remainder at other
times throughout the year. Premiums are generally due in
installments over the contract term, with each installment
generally received within 30 days after the due date.

Retrocessional Reinsurance

Effective January 1, 1999, we arranged a
proportional reinsurance facility for IPCRe through two leading
intermediaries. The business covered by this facility is
property catastrophe business written by IPCRe. The facility
provides coverage of up to $50 million in each of at least 5
named zones, and potentially other zones of our choosing,
provided that the risks in those zones do not accumulate with
those in the named zones. The United States and the Caribbean
are excluded zones. The named zones are the United Kingdom;
Europe (excluding the U.K.); Australia / New Zealand; Japan and
Canada. Business ceded to the facility is solely at our
discretion. Within these limitations, we may designate the
treaties to be included in the facility, subject to IPCRe
retaining at least 50% of the risk. The premium ceded is pro
rata, less brokerage, taxes and an override commission. AIG, as
a participating reinsurer, has a 10% participation on a direct
basis. Most reinsurers participating in the facility have
financial strength ratings of AA or above, and the minimum
rating is A. Effective January 1, 2000 this facility was
renewed on the same terms, although only 92% participation was
bound. For 2001, the facility was again renewed on the same
terms, but with only 61.5% bound. For 2002, the facility was
again renewed, but with 37.0% bound. IPCRe will co-participate
on the balance, and net exposures will be proportionately higher
on those treaties ceded to the facility.

Marketing

Our customers generally are sophisticated,
long-established insurers who understand the risks involved and
who desire the assurance not only that claims will be paid but
that reinsurance will continue to be available after claims are
paid. Catastrophic losses can be expected to affect financial
results adversely from time to time, and we believe that
financial stability and growth of capital (as well as service
and innovation) are essential for creating long-term
relationships with clients, and that such relationships are key
to creating

10



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long-term value to the Company and our
shareholders. During 2001, no single ceding insurer accounted
for more than 5.6% of our gross premiums written.


We market our reinsurance products worldwide
through non-exclusive relationships with more than 50 of the
leading reinsurance brokers active in the U.S. and non-U.S.
markets for property catastrophe reinsurance. In addition, from
1993 to January, 2001 our products were marketed in Europe
through IPCRe Services. As noted above, IPCRe Services ceased
operations in January 2001, because consolidation among our
clients and brokers has reduced the need to maintain a physical
presence in the U.K. in order to promote our services.

Based on premiums written during the year ended
December 31, 2001, the five brokers from which we derive
the largest portions of our business (with the approximate
percentage of our business derived from such broker) are Marsh
Limited and affiliates (41.8%), Aon Corp. and affiliates
(17.8%), Willis Faber (11.0%), Benfield Greig (10.9%), and
Herbert Clough (3.7%). During the year ended December 31,
2001, we had in force reinsurance contracts with only 13 ceding
companies which were not derived from a reinsurance broker;
otherwise, our products are marketed exclusively through
brokers. Of the total premiums attributable to the five largest
producing brokers referred to above, 1.0% was attributable to
brokers affiliated with the insurers seeking coverage. All
brokerage transactions are entered into on an arms-length
basis.

Our brokers perform data collection, contract
preparation and other administrative tasks, enabling us to
market our reinsurance products cost effectively by maintaining
a small staff. By relying largely on reinsurance brokers to
market our products, we are able to avoid the expense and
regulatory complications of worldwide offices, thereby
minimizing fixed costs associated with marketing activities. We
believe that by maintaining close relationships with brokers, we
are able to obtain access to a broad range of potential
reinsureds. We meet frequently in Bermuda and elsewhere outside
the United States with brokers and senior representatives of
clients and prospective clients. All contract submissions are
approved in IPCRes executive offices in Bermuda, and we do
not believe that conducting our operations in Bermuda has
adversely affected our marketing activities in light of the
client base we have attracted and retained.

Reserves

Under U.S. generally accepted accounting
principles, we are not permitted to establish loss reserves with
respect to our property catastrophe business until the
occurrence of an event which may give rise to a claim. Once such
an event occurs, we establish reserves based upon estimates of
total losses incurred by the ceding insurers as a result of the
event and our estimate of the portion of such loss we have
reinsured. With respect to our non-catastrophe business, we are
permitted to establish loss reserves as determined by a
historical loss development pattern. Only loss reserves
applicable to losses incurred up to the reporting date may be
set aside, with no allowance for the provision of a contingency
reserve to account for expected future losses. Claims arising
from future catastrophic events can be expected to require the
establishment of substantial reserves from time to time. Our
reserves are adjusted as we receive notices of claims and proofs
of loss from reinsureds and as estimates of severity of damages
and our share of the total loss are revised.

We also establish reserves for losses incurred as
a result of an event known but not reported to us. These
incurred but not reported (IBNR) reserves are
established for both catastrophe and other losses. To estimate
the portion of loss and loss adjustment expenses relating to
these claims for the year, we review our portfolio of business
to determine where the potential for loss may exist. Also,
various loss forecasting models and industry loss data, as well
as actual experience, knowledge of the business written by us
and general market trends in the reinsurance industry, are
considered. We have contracted a leading worldwide independent
firm of actuaries to conduct a review of reserves on a
semi-annual basis.

Generally, reserves are established without
regard to whether we may subsequently contest the loss. Our
policy is to establish reserves for reported losses based upon
reports received from ceding companies, supplemented by our
reserve estimates.

Loss reserves represent our estimates, at a given
point in time, of the ultimate settlement and administration
costs of claims incurred, and it is possible that the ultimate
liability may exceed or be less than such estimates. Such
estimates are not precise in that, among other things, they are
based on predictions of

11



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##### Table of Contents



future developments and estimates of future
trends in claim severity and frequency and other variable
factors such as inflation and currency exchange rates. During
the claim settlement period, it often becomes necessary to
refine and adjust the estimates of liability on a claim either
upward or downward, and any such adjustment would affect our
results of operations in the period when the adjustment is
determined. Even after such adjustments, ultimate liability may
materially exceed or be less than the revised estimates.
Moreover, our reserve estimates may be inherently more volatile
than the reserve estimates of a reinsurer with a more
established claim history. In contrast to casualty losses, which
frequently can be determined only through lengthy, unpredictable
litigation, property losses tend to be reported promptly and
settled within a shorter period of time.


Investments

General.Our
current investment strategy is defined primarily by the need to
safeguard our capital, since we believe that the risks inherent
in catastrophe reinsurance should not be augmented by a
speculative investment policy. For this reason our investment
policy is conservative with a strong emphasis on the quality of
investments. At December 31, 2001, other than cash, our
investments consisted of fixed maturity securities, none of
which had a rating of less than A, shares of stock in the S
& P 500 companies and investments in a global equity fund.
Corporate bonds represented 57% of total fixed maturity
investments at December 31, 2001 and of these 45% were
issued by U.S. corporations and 55% by non-U.S. corporations,
respectively. Our investment policy also stresses
diversification and at December 31, 2001, only the U.S.
Treasury and the Federal Home Loan Mortgage Corp. were
individual issuers whose securities represented more than 5% of
our portfolio. In addition to these parameters, guidelines are
also set which limit permitted issuers, the amount of non-U.S.
dollar denominated securities and the target duration of the
portfolio.

The following table summarizes the fair value of
our investments and cash and cash equivalents as of
December 31, 2001 and 2000:

|                                    |                                         |                |           |         |  |   |         |         | 
|----------------------------------- | --------------------------------------- | -------------- | --------- | ------- |  | - | ------- | ------- | 
|                                    |                                         |               
|                                    |                                         | December 31,  
|                                    |                                         |               
|Type of Investment                  |                                         | 2001           |           | 2000   
|                                    |                                         |                |           |        
|                                    |                                         |               
|                                    |                                         | (in thousands)
|Fixed Maturities Available for Sale |                                         |                |           |         |  |   |         |        
|                                    | U.S. Government and government agencies |                | $         | 151,369 |  |   | $       | 126,792 | 
|                                    | Other governments                       |                |           | 105,347 |  |   |         | 78,898  | 
|                                    | Corporate                               |                |           | 435,845 |  |   |         | 263,522 | 
|                                    | Supranational entities                  |                |           | 65,663  |  |   |         | 54,448  | 
|                                    |                                         |                |           |         |  |   |         |        
|                                    |                                         |                | 758,224   |         |  |   | 523,660 |        
|Equities, available for sale        |                                         |                | 158,870   |         |  |   | 65,462  |        
|Cash and cash equivalents           |                                         |                | 315,207   |         |  |   | 9,409   |        
|                                    |                                         |                |           |         |  |   |         |        
|                                    |                                         | $              | 1,232,301 |         |  | $ | 598,531 |        
|                                    |                                         |                |           |         |  |   |         |        

Our investment guidelines are reviewed
periodically and are subject to change at the discretion of the
Board of Directors.

Maturity and Duration of Portfolio.Currently, we maintain a target
modified duration for the portfolio of between 1.25 years
and 3.75 years although actual maturities of individual
securities vary from less than one year to a maximum of eight
years for fixed maturity securities, and ten years for
money-market securities. At December 31, 2001 the fixed
maturity portfolio (including cash and cash equivalents within
such portfolio) had an average maturity of 2.2 years and an
average modified duration of 1.9 years. We believe that,
given the relatively high quality of our portfolio, adequate
market liquidity exists to meet our cash demands.

12



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The following table summarizes the fair value by
maturities of our fixed maturity investment portfolio as of
December 31, 2001 and 2000. For this purpose, maturities
reflect contractual rights to put or call the securities; actual
maturities may be longer.

|                                       |  |                |         |      |  |   |         | 
|-------------------------------------- |  | -------------- | ------- | ---- |  | - | ------- | 
|                                       |  |               
|                                       |  | December 31,  
|                                       |  |               
|                                       |  | 2001           |         | 2000
|                                       |  |                |         |     
|                                       |  |               
|                                       |  | (in thousands)
|Due in one year or less                |  | $              | 40,922  |      |  | $ | 26,010  | 
|Due after one year through five years  |  |                | 580,383 |      |  |   | 482,844 | 
|Due after five years through ten years |  |                | 136,919 |      |  |   | 14,806  | 
|                                       |  |                |         |      |  |   |         | 
|                                       |  | $              | 758,224 |      |  | $ | 523,660 | 
|                                       |  |                |         |      |  |   |         | 

Quality of Debt Securities in Portfolio.Our investment guidelines
stipulate that a majority of the securities be AAA and AA rated,
although a select number of A rated issues is permitted. The
primary rating source is Moodys Investors Service
(Moodys) and, when no Moodys rating is
available, S & P ratings are used.

The following table summarizes the composition of
the fair value of all cash and fixed maturity investments by
rating:

|                                        |  |              |        |      |  |  |        | 
|--------------------------------------- |  | ------------ | ------ | ---- |  |  | ------ | 
|                                        |  |             
|                                        |  | December 31,
|                                        |  |             
|                                        |  | 2001         |        | 2000
|                                        |  |              |        |     
|Cash and cash equivalents               |  |              | 29.4%  |      |  |  | 1.8%   | 
|U.S. Government and government agencies |  |              | 14.1%  |      |  |  | 23.8%  | 
|AAA                                     |  |              | 16.9%  |      |  |  | 29.0%  | 
|AA                                      |  |              | 32.2%  |      |  |  | 28.7%  | 
|A                                       |  |              | 7.4%   |      |  |  | 16.7%  | 
|                                        |  |              |        |      |  |  |        | 
|                                        |  |              | 100.0% |      |  |  | 100.0% | 
|                                        |  |              |        |      |  |  |        | 

There are no delinquent securities in our
investment portfolio.

Real Estate.Our portfolio does not contain any
investments in real estate or mortgage loans.

Foreign Currency Exposure.At December 31, 2001 and
2000, most of our fixed maturity investments were in securities
denominated in U.S. dollars, with the exception of an Australian
dollar time deposit in the amount of approximately U.S. $3.4
million (equivalent). The investment guidelines permit up to 25%
of the portfolio to be invested in non-U.S. dollar securities.
However, from inception, such investments have been made
infrequently and for the purpose of improving overall portfolio
yield. When we do hold non-U.S. dollar denominated securities,
we have entered and may enter into forward foreign exchange
contracts for purposes of hedging our non-U.S. dollar
denominated investment portfolio. In addition, in the event that
loss payments must be made in currencies other than the U.S.
dollar, in some cases we will match the liability with assets
denominated in the same currency, thus mitigating the effect of
exchange rate movements on the balance sheet. To date, this
strategy has been used on three occasions. See also
Managements Discussion and Analysis 
Quantitative and Qualitative Disclosure about Market Risk.

Derivatives.Our investment policy guidelines
provide that financial futures and options and foreign exchange
contracts may not be used in a speculative manner but may be
used, subject to certain numerical limits, as part of a
defensive strategy to protect the market value of the portfolio.

Investment Advisory and Custodial Services.Investment advisory and custodial
services are provided to us by subsidiaries of AIG.

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Competition

The property catastrophe reinsurance industry is
highly competitive. We compete, and will continue to compete,
with insurers and property catastrophe reinsurers worldwide,
many of which have greater financial, marketing and management
resources than us. Some of our competitors are large financial
institutions who have reinsurance divisions, while others are
specialty reinsurance companies. In total, there are several
hundred companies writing reinsurance of different types,
including property catastrophe. Our main competition in the
industry comes from multi-line insurance and reinsurance
providers that write catastrophe-based products as part of a
larger portfolio. The major players include companies based in
the U.S., Europe and Bermuda. Though all of these companies
offer property catastrophe reinsurance, in many cases it
accounts for a small percentage of their total portfolio. During
the fourth quarter of 2001, in response to a reduction in market
capacity and perceived increase in demand, a number of new
insurance and reinsurance companies were formed in Bermuda and
elsewhere, most of which intend to write property catastrophe
reinsurance as part of their business plan. Also, several of our
existing competitors have raised additional capital, or have
announced plans to do so. In addition, there may be established
companies or new companies of which we are not aware that may be
planning to enter the property catastrophe reinsurance market or
existing reinsurers that may be planning to commit capital to
this market. Competition in the types of reinsurance business
that we underwrite is based on many factors, including premium
charges and other terms and conditions offered, services
provided, ratings assigned by independent rating agencies, speed
of claims payment, claims experience, perceived financial
strength, the length of relationships with clients and brokers
and experience and reputation of the reinsurer in the line of
reinsurance to be written. Many of the reinsurers who have
entered the Bermuda-based and other reinsurance markets have or
could have more capital than us. The full effect of this
additional capital on the reinsurance market may not be known
for some time. No assurance can be given as to what impact this
additional capital will ultimately have on terms or conditions
of the reinsurance contracts of the types written by us.

In September 1996, IPCRe was rated by A.M.
Best Company, Inc. (A.M. Best), who gave it an
initial rating of A+ (Superior). This rating was affirmed by
A.M. Best in all subsequent years. In July, 1997 S & P
assigned financial strength and counter-party credit ratings of
A+ (Strong), which were also affirmed in all subsequent years.
Prior to 1996, IPCRe was not rated by any rating agency. During
1999, these ratings were extended to IPCRe Europe. The rating
received from A.M. Best represents the second highest rating on
their rating scale. The rating received from S & P
represents the fifth highest rating on their rating scale. Such
ratings are based on factors of concern to cedents and brokers
and are not directed toward the protection of investors. Such
ratings are neither a rating of securities nor a recommendation
to buy, hold or sell such securities. While we believe that
IPCRes current ratings are of benefit, some of our
principal competitors have a rating equal to or greater than
that of IPCRe. Insurance ratings are one factor used by brokers
and cedents in the United States as a means of assessing the
financial strength and quality of reinsurers. In addition, a
cedents own rating may be adversely affected by the lack
of a rating of its reinsurer. IPCRe is not licensed or admitted
as an insurer in any jurisdiction in the United States and, as a
consequence, must generally post letters of credit or other
security to cover outstanding claims of, or unearned premiums
with respect to, ceding insurers in the United States to enable
such insurers to obtain favorable regulatory capital treatment
of their reinsurance. See Managements Discussion and
Analysis of Financial Condition and Results of
Operations  Liquidity and Capital Resources,
contained in the Annual Report.

We are aware of a number of new, proposed or
potential legislative or industry changes that may impact upon
the worldwide demand for property catastrophe reinsurance.
First, following the September 11 terrorist attacks,
various proposed legislation has been introduced in the
U.S. Congress designed to ensure the availability of
insurance coverage for terrorist acts, and the prospects for
enactment of these proposals is uncertain. Legislation has been
adopted in the U.S. House of Representatives designed,
among other things, to provide federal government loans over a
short-term period to commercial insurers and reinsurers for
funding losses arising from terrorist acts against
U.S. properties, which loans would be repaid through
industry assessments and, if losses exceed a threshold,
policyholder assessments. Alternative proposed legislation has
been introduced in the U.S. Senate, including legislation
providing for the direct payment by the U.S. government for
losses arising from terrorist acts to the insureds of insurers
who continue to write such

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coverage, legislation which would provide direct
government assistance to insurers and legislation which would
require insurers to write coverage for terrorist acts and
establish a mandatory reinsurance pool. This legislation may
also provide insurance and reinsurance capacity in the markets
and to the customers we target; regulate the terms of insurance
and reinsurance capacity and reinsurance policies in a manner
which could materially adversely affect us, directly or
indirectly, by requiring coverage for terrorist acts to be
offered by insurers and/or reinsurers, benefiting our
competitors, reducing the demand for reinsurance or benefiting
insurers as compared to reinsurers such as us; providing sources
of liquidity to U.S.-based companies; or disproportionately
benefiting U.S. or other foreign countries companies over
Bermuda-based companies such as ourselves. Legislation may be
introduced in other jurisdictions. In addition, over the last
few years capital markets participants, including exchanges and
financial intermediaries, have developed financial products such
as risk securitizations, intended to compete with traditional
reinsurance, the usage of which has grown in volume. Further,
the tax policy of the countries in which our clients operate can
affect the demand for reinsurance. We are also aware of many
potential initiatives by capital market participants to produce
additional alternative products that may compete with the
existing catastrophe reinsurance markets. We are unable to
predict the extent to which the foregoing new, proposed or
potential initiatives may affect the demand for our products or
the risks which may be available for us to consider underwriting.


Employees

As of January 1, 2002, we employed
15 people on a full-time basis including our Chief
Executive Officer, Chief Financial Officer and three
underwriters. We believe that employee relations are good. None
of our employees are subject to collective bargaining
agreements, and we know of no current efforts to implement such
agreements at IPC.

Many of our employees, including most of our
senior management, are employed pursuant to work permits granted
by the Bermuda authorities. These permits expire at various
times over the next several years. We have no reason to believe
that these permits would not be extended upon request at their
respective expirations. However, new regulations enacted by the
Minister of Labour and Home Affairs in Bermuda have imposed
limitations on the number of times permits for non-key employees
are renewed, to a maximum of six years.

Subsidiaries

IPCRe is a wholly-owned subsidiary of IPC
Holdings. It was formed as a Bermuda company in June, 1993.

On September 10, 1998, IPCRe incorporated a
subsidiary in Ireland named IPCRe Europe Limited. Effective
October 1, 1998, IPCRe Europe commenced underwriting
selected reinsurance business in Europe. Currently, IPCRe Europe
retrocedes 90% of the business it underwrites to IPCRe.

On November 7, 2001, IPC Holdings
incorporated a new subsidiary in Bermuda named IPCRe
Underwriting Services Limited (IPCUSL). IPCUSL is
registered in Bermuda and is licensed as an insurance agent.

Regulation

Bermuda The
Insurance Act of 1978, as amended, and Related Regulations (the
Insurance Act).

As a holding company, we are not subject to
Bermuda insurance regulations. The Insurance Act, which
regulates the insurance business of IPCRe, provides that no
person shall carry on any insurance business in or from Bermuda
unless registered as an insurer under the Insurance Act by the
Supervisor of Insurance of Bermuda (the Supervisor),
who is responsible for the day-to-day supervision of insurers.
Under the Insurance Act, insurance business includes reinsurance
business. The Supervisor, in deciding whether to grant
registration, has broad discretion to act as the supervisor
thinks fit in the public interest. The Supervisor is required by
the Insurance Act to determine whether the applicant is a fit
and proper body to be engaged in the insurance business and, in
particular, whether it has, or has available to it, adequate
knowledge and expertise.

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The registration of an applicant as an insurer is
subject to its complying with the terms of its registration and
such other conditions as the Supervisor may impose at any time.


An Insurance Advisory Committee appointed by the
Bermuda Minister of Finance advises the Supervisor on matters
connected with the discharge of the Supervisors functions
and sub-committees thereof supervise and review the law and
practice of insurance in Bermuda, including reviews of
accounting and administrative procedures.

The Insurance Act imposes on Bermuda insurance
companies solvency and liquidity standards and auditing and
reporting requirements and grants to the Supervisor powers to
supervise, investigate and intervene in the affairs of insurance
companies. Certain significant aspects of the Bermuda insurance
regulatory framework are set forth below.

Classification of
Insurers.The Insurance Act
distinguishes between insurers carrying on long-term business
and insurers carrying on general business. There are four
classifications of insurers carrying on general business, with
Class 4 insurers subject to the strictest regulation. IPCRe
is registered as a Class 4 insurer, and is regulated as
such under the Insurance Act.

Cancellation of Insurers
Registration.An insurers
registration may be cancelled by the Supervisor on certain
grounds specified in the Insurance Act, including failure of the
insurer to comply with its obligations under the Insurance Act
or, if in the opinion of the Supervisor after consultation with
the Insurance Advisory Committee, the insurer has not been
carrying on business in accordance with sound insurance
principles.

Principal
Representative.An insurer is
required to maintain a principal office in Bermuda and to
appoint and maintain a principal representative in Bermuda. For
the purpose of the Insurance Act, the principal office of IPCRe
is at our principal executive offices in Pembroke, Bermuda, and
IPCRes principal representative is our President and Chief
Executive Officer. Without a reason acceptable to the
Supervisor, an insurer may not terminate the appointment of its
principal representative, and the principal representative may
not cease to act as such, unless 30 days notice in
writing to the Supervisor is given of the intention to do so. It
is the duty of the principal representative, within 30 days
of reaching the view that there is a likelihood of the insurer
for which the principal representative acts becoming insolvent
or that a reportable event has, to the principal
representatives knowledge, occurred or is believed to have
occurred, to make a report in writing to the Supervisor setting
out all the particulars of the case that are available to the
principal representative. Examples of such a reportable
event include failure by the insurer to comply
substantially with a condition imposed upon the insurer by the
Supervisor relating to a solvency margin or a liquidity or other
ratio.

Independent Approved
Auditor.Every registered insurer
must appoint an independent auditor who will annually audit and
report on the statutory financial statements and the statutory
financial return of the insurer, both of which, in the case of
IPCRe, are required to be filed annually with the Supervisor.
The independent auditor of IPCRe must be approved by the
Supervisor and may be the same person or firm which audits
IPCRes financial statements and reports for presentation
to its shareholders.

Loss Reserve
Specialist.As a registered
Class 4 insurer, IPCRe is required to submit an opinion of
its approved loss reserve specialist with its statutory
financial return in respect of its loss and loss expense
provisions. The loss reserve specialist, who will normally be a
qualified casualty actuary, must be approved by the Supervisor.

Statutory Financial
Statements.An insurer must
prepare annual statutory financial statements. The Insurance Act
prescribes rules for the preparation and substance of such
statutory financial statements (which include, in statutory
form, a balance sheet, an income statement, a statement of
capital and surplus and notes thereto). The insurer is required
to give detailed information and analyses regarding premiums,
claims, reinsurance and investments. The statutory financial
statements are not prepared in accordance with U.S. generally
accepted accounting principles and are distinct from the
financial statements prepared for presentation to the
insurers shareholders under the Companies Act 1981 of
Bermuda (the Companies Act), which financial
statements will be prepared in accordance with U.S. generally
accepted accounting principles. IPCRe, as a general business
insurer, is required to submit the annual statutory financial
statements

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as part of the annual statutory financial return.
The statutory financial statements and the statutory financial
return do not form part of the public records maintained by the
Supervisor.


Annual Statutory Financial
Return.IPCRe is required to file
with the Supervisor a statutory financial return no later than
four months after its financial year end (unless specifically
extended). The statutory financial return for an insurer
includes, among other matters, a report of the approved
independent auditor on the statutory financial statements of
such insurer, solvency certificates, the statutory financial
statements themselves, the opinion of the loss reserve
specialist and a schedule of reinsurance ceded. The solvency
certificates must be signed by the principal representative and
at least two directors of the insurer who are required to
certify, among other matters, whether the minimum solvency
margin has been met and whether the insurer complied with the
conditions attached to its certificate of registration. The
independent approved auditor is required to state whether in its
opinion it was reasonable for the directors to so certify. Where
an insurers accounts have been audited for any purpose
other than compliance with the Insurance Act, a statement to the
effect must be filed with the statutory financial return.

Minimum Solvency Margin and Restrictions on
Dividends and Distributions. Under
the Insurance Act, the value of the general business assets of a
Class 4 insurer, such as IPCRe, must exceed the amount of
its general business liabilities by an amount greater than the
prescribed minimum solvency margin. IPCRe:



| |     |                                                                                                                   
| | --- | ------------------------------------------------------------------------------------------------------------------
| | (1) | is required with respect to its general business,
	to maintain a minimum solvency margin equal to the greatest of:

(A) $100,000,000,



| |     |                                                                                                                                                                                                  
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (B) | 50% of net premiums written (being gross premiums
	written less any premiums ceded by IPCRe, but IPCRe may not
	deduct more than 25% of gross premiums when computing net
	premiums written), and

(C) 15% of
loss and other insurance reserves;



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | is prohibited from declaring or paying any
	dividends during any financial year if it is in breach of its
	minimum solvency margin or minimum liquidity ratio or if the
	declaration or payment of such dividends would cause it to fail
	to meet such margin or ratio (if it has failed to meet its
	minimum solvency margin or minimum liquidity ratio on the last
	day of any financial year, IPCRe is prohibited, without the
	approval of the Supervisor, from declaring or paying any
	dividends during the next financial year);
|
| | (3) | is prohibited from declaring or paying in any
	financial year dividends of more than 25% of its total statutory
	capital and surplus (as shown on its previous financial
	years statutory balance sheet) unless it files (at least
	7 days before payment of such dividends) with the
	Supervisor an affidavit statement that it will continue to meet
	the required margins;                                                                                                                                                         
|
| | (4) | is prohibited, without the approval of the
	Supervisor, from reducing by 15% or more its total statutory
	capital as set out in its previous years financial
	statements, and any application for such approval must include
	an affidavit stating that it will continue to meet the required
	margins; and                                                                                                                                                                                                                           
|
| | (5) | is required, at any time it fails to meet its
	solvency margin, within 30 days (45 days where total
	statutory capital and surplus falls to $75 million or less)
	after becoming aware of that failure or having reason to believe
	that such failure has occurred, to file with the Supervisor a
	written report containing certain information.                                                                                                                                                                                      

Minimum Liquidity
Ratio.The Insurance Act provides
a minimum liquidity ratio for general business insurers. An
insurer engaged in general business is required to maintain the
value of its relevant assets at not less that 75% of the amount
of its relevant liabilities. Relevant assets include cash and
time deposits, quoted investments, unquoted bonds and
debentures, first liens on real estate, investment income due
and accrued, accounts and premiums receivable and reinsurance
balances receivable. There are certain categories of assets
which, unless specifically permitted by the Supervisor, do not
automatically qualify as relevant assets, such as unquoted
equity securities, investments in and advances to affiliates and
real estate and collateral loans. The

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relevant liabilities are total general business
insurance reserves and total other liabilities less deferred
income tax and sundry liabilities (by interpretation, those not
specifically defined).


Supervision, Investigation and
Intervention.The Supervisor may
appoint an inspector with extensive powers to investigate the
affairs of an insurer if the Supervisor believes that an
investigation is required in the interest of the insurers
policyholders or persons who may become policyholders. In order
to verify or supplement information otherwise provided to the
Supervisor, the Supervisor may direct an insurer to produce
documents or information relating to matters connected with the
insurers business.

If it appears to the Supervisor that there is a
risk of the insurer becoming insolvent, or that it is in breach
of the Insurance Act or any conditions imposed upon its
registration, the Supervisor may, among other things, direct the
insurer (1) not to take on any new insurance business,
(2) not to vary any insurance contract if the effect would
be to increase the insurers liabilities, (3) not to
make certain investments, (4) to realize certain
investments, (5) to maintain in, or transfer to the custody
of a specified bank, certain assets, (6) not to declare or
pay dividends or other distributions or to restrict the making
of such payments and/or (7) to limit its premium income.

Disclosure of
Information.In addition to powers
under the Insurance Act to investigate the affairs of an
insurer, the Supervisor may require certain information from an
insurer (or certain other persons) to be produced to him.
Further, the Supervisor has been given powers to assist other
regulatory authorities, including foreign insurance regulatory
authorities with their investigations involving insurance and
reinsurance companies in Bermuda but subject to restrictions.
For example, the Supervisor must be satisfied that the
assistance being requested is in connection with the discharge
of regulatory responsibilities of the foreign regulatory
authority. Further, the Supervisor must consider whether to
co-operate is in the public interest. The grounds for disclosure
are limited and the Insurance Act provides sanctions for breach
of the statutory duty of confidentiality.

Certain Other
Considerations.IPC Holdings and IPCRe will each also
need to comply with the provisions of the Companies Act
regulating the payment of dividends and making of distributions
from contributed surplus. A company is prohibited from declaring
or paying a dividend, or making a distribution out of
contributed surplus, if there are reasonable grounds for
believing that: (a) the company is, or would after the
payment be, unable to pay its liabilities as they become due; or
(b) the realizable value of the companys assets would
thereby be less than the aggregate of its liabilities and its
issued share capital and share premium accounts.

Although IPCRe is incorporated in Bermuda, it is
classified as non-resident of Bermuda for exchange control
purposes by the Bermuda Monetary Authority. Pursuant to its
non-resident status, IPCRe may hold any currency other than
Bermuda Dollars and convert that currency into any other
currency (other than Bermuda Dollars) without restriction.

As exempted companies, IPC Holdings
and IPCRe may not, without the express authorization of the
Bermuda legislature or under a license granted by the Minister,
participate in certain business transactions, including:
(i) the acquisition or holding of land in Bermuda (except
that held by way of lease or tenancy agreement which is required
for its business and held for a term not exceeding
50 years, or which is used to provide accommodation or
recreational facilities for its officers and employees and held
with the consent of the Minister, for a term not exceeding
21 years); (ii) the taking of mortgages on land in
Bermuda in excess of $50,000; or (iii) the carrying on of
business of any kind in Bermuda, except in certain limited
circumstances such as doing business with another exempted
undertaking in furtherance of the business of IPC Holdings or
IPCRe (as the case may be) carried on outside Bermuda.

The Bermuda government actively encourages
foreign investment in exempted entities like the
Company that are based in Bermuda, but do not operate in
competition with local businesses. As well as having no
restrictions on the degree of foreign ownership, IPC Holdings
and IPCRe are not currently subject to taxes on their income or
dividends or to any foreign exchange controls in Bermuda. In
addition, there currently is no capital gains tax in Bermuda.

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United States

IPCRe is not admitted to do business in the
United States. The insurance laws of each state of the United
States and of many other countries regulate the sale of
insurance and reinsurance within their jurisdictions by alien
insurers and reinsurers such as IPCRe, which are not admitted to
do business within such jurisdictions. With some exceptions,
such sale of insurance or reinsurance within a jurisdiction
where the insurer is not admitted to do business is prohibited.
We do not intend to maintain an office or to solicit, advertise,
settle claims or conduct other insurance activities in any
jurisdiction other than Bermuda or Ireland where the conduct of
such activities would require that IPCRe be so admitted.

In addition to the regulatory requirements
imposed by the jurisdictions in which they are licensed,
reinsurers business operations are affected by regulatory
requirements in various states of the United States governing
credit for reinsurance which are imposed on their
ceding companies. In general, a ceding company which obtains
reinsurance from a reinsurer that is licensed, accredited or
approved by the jurisdiction or state in which the reinsurer
files statutory financial statements is permitted to reflect in
its statutory financial statements a credit in an aggregate
amount equal to the liability for unearned premiums and loss
reserves and loss expense reserves ceded to the reinsurer. IPCRe
is not licensed, accredited or approved in any state in the
United States. The great majority of states, however, permit a
credit to statutory surplus resulting from reinsurance obtained
from a non-licensed or non-accredited reinsurer to be offset to
the extent that the reinsurer provides a letter of credit or
other acceptable security arrangement. A few states do not allow
credit for reinsurance ceded to non-licensed reinsurers except
in certain limited circumstances and others impose additional
requirements that make it difficult to become accredited. IPCRe
is also subject to excise tax in the United States for U.S.
business, and in certain other jurisdictions.

We do not believe that IPCRe was in violation of
insurance laws of any jurisdiction in the United States. There
can be no assurance, however, that inquiries or challenges to
IPCRes reinsurance activities will not be raised in the
future. We believe that IPCRes manner of conducting
business through our offices in Bermuda has not materially
adversely affected its operations to date. There can be no
assurance, however, that our location, regulatory status or
restrictions on our activities resulting therefrom will not
adversely affect our ability to conduct business in the future.

European Union

IPCRe Europe is incorporated in Ireland, and as
such subject to regulations imposed by the European Union.

Certain United States Federal Income Tax
Considerations

The discussion below is only a general summary
of certain United States federal income tax considerations that
are relevant to certain holders of Common Shares of IPC
Holdings. It does not address all relevant tax considerations
that may be relevant to holders of Common Shares nor does it
address tax considerations that may be relevant to certain
holders. Investors and prospective investors should consult
their own tax advisors concerning federal, state, local and
non-U.S. tax consequences of ownership and disposition of Common
Shares.

Taxation of IPC Holdings and IPCRe.IPC Holdings and IPCRe are Bermuda
corporations; neither files United States federal income tax
returns. We believe that IPCRe operates in such a manner that it
is not subject to U.S. tax (other than U.S. excise tax
on reinsurance premiums and withholding tax on certain
investment income from U.S. sources) because it does not
engage in a trade or business in the United States. However,
because definitive identification of activities which constitute
being engaged in a trade or business in the United States is not
provided by the U.S. Internal Revenue Code of 1986, as
amended (the Code) or regulations or court
decisions, there can be no assurance that the U.S. Internal
Revenue Service (the IRS) will not contend that IPC
Holdings and/or IPCRe is engaged in a trade or business in the
United States. If IPCRe were engaged in a trade or business in
the United States (and, if IPCRe were to qualify for benefits
under the income tax treaty between the United States and
Bermuda, such trade or business were attributable to a
permanent establishment in the United States), IPCRe
would be subject to U.S. tax at regular

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corporate rates on its income that is effectively
connected with its U.S. trade or business, plus an
additional 30% branch profits tax on such income
remaining after the regular tax, in which case our earnings and
shareholders investment could be materially adversely
affected.


Currently, IPCRe pays premium excise taxes in the
United States (1%), Australia (3%), and certain other
jurisdictions. From time to time, U.S. legislation has been
proposed which would increase such tax to 4%.

Controlled Foreign Corporation Rules.Each United States
shareholder of a controlled foreign
corporation (CFC) who owns shares in the CFC
on the last day of the CFCs taxable year must include in
its gross income for United States federal income tax purposes
its pro rata share of the CFCs subpart F
income, even if the subpart F income is not distributed.
For these purposes, any U.S. person who owns, directly or
indirectly through foreign persons, or is considered to own
under applicable constructive ownership rules of the Code, 10%
or more of the total combined voting power of all classes of
stock of a foreign corporation will be considered to be a
United States shareholder. In general, a foreign
insurance company such as IPCRe is treated as a CFC only if such
United States shareholders collectively own more
than 25% of the total combined voting power or total value of
our stock for an uninterrupted period of 30 days or more
during any tax year. AIG owns 24.3% of the Common Shares and the
AIG Option, although, pursuant to our Bye-laws, the combined
voting power of these shares is limited to less than 10% of the
combined voting power of all shares. We believe that, because of
the dispersion of IPC Holdings share ownership among
holders other than AIG and because of the restrictions on
transfer, issuance or repurchase of the Common Shares,
shareholders of IPC Holdings will not be subject to treatment as
United States shareholders of a CFC. In addition,
because under the Bye-laws no single shareholder (including AIG)
is permitted to exercise as much as 10% of the total combined
voting power of IPC Holdings, shareholders of IPC Holdings
should not be viewed as United States shareholders
of a CFC for purposes of these rules. There can be no assurance,
however, that these rules will not apply to shareholders of IPC
Holdings. Accordingly, U.S. persons who might, directly or
through attribution, acquire 10% or more of the Common Shares of
IPC Holdings should consider the possible application of the CFC
rules.

Related Person Insurance Income Rules.If IPCRes related person
insurance income (RPII) were to equal or exceed 20%
of IPCRes gross insurance income in any taxable year, a
U.S. person who owns Common Shares directly or indirectly
on the last day of the taxable year would likely be required to
include in its income for U.S. federal income tax purposes
the shareholders pro rata share of IPCRes RPII for
the taxable year, determined as if such RPII were distributed
proportionately to such United States shareholders at that date
regardless of whether such income is distributed. The amount of
RPII earned by IPCRe (generally, premium and related investment
income from the direct or indirect insurance or reinsurance of
any direct or indirect U.S. shareholder of IPCRe or any person
related to such shareholder, including IPC Holdings) will depend
on a number of factors, including the geographic distribution of
IPCRes business and the identity of persons directly or
indirectly insured or reinsured by IPCRe. Although we do not
believe that the 20% threshold was met in taxable years from
1994 to 2001, some of the factors which determine the extent of
RPII in any period may be beyond our control. Consequently,
there can be no assurance that IPCRes RPII will not equal
or exceed 20% of its gross insurance income in any taxable year.

The RPII rules provide that if a shareholder who
is a U.S. person disposes of shares in a foreign insurance
corporation that has RPII (even if the amount of RPII is less
than 20% of the corporations gross insurance income) and
in which U.S. persons own 25% or more of the shares, any
gain from the disposition will generally be treated as ordinary
income to the extent of the shareholders share of the
corporations undistributed earnings and profits that were
accumulated during the period that the shareholder owned the
shares (whether or not such earnings and profits are
attributable to RPII). In addition, such a shareholder will be
required to comply with certain reporting requirements,
regardless of the amount of shares owned by the shareholder.
These rules should not apply to dispositions of Common Shares
because IPC Holdings is not itself directly engaged in the
insurance business and because proposed U.S. Treasury
regulations appear to apply only in the case of shares of
corporations that are directly engaged in the insurance
business. There can be no assurance, however, that the IRS will
interpret the proposed regulations in this manner or that the
applicable regulations

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will not be promulgated in final form in a manner
that would cause these rules to apply to disposition of Common
Shares.


Tax-Exempt Shareholders.Tax-exempt entities are generally
required to treat certain subpart F insurance income, including
RPII, that is includible in income by the tax-exempt entity as
unrelated business taxable income.




Item 2.  Properties

Pursuant to an administrative services agreement
with American International Company, Limited (AICL),
a wholly-owned subsidiary of AIG, IPC Holdings and IPCRe are
allocated office space in AICLs building in Bermuda and
our principal executive offices are located there. The address
of the principal executive offices is American International
Building, 29 Richmond Road, Pembroke HM 08, Bermuda
and our telephone number is (441) 298-5100.




Item 3.  Legal
Proceedings

We will be subject to litigation and arbitration
in the ordinary course of our business. We are not currently
involved in any material pending litigation or arbitration
proceedings.




Item 4.  Submission of
Matters to a Vote of Security Holders

No matters were submitted to a vote of our
shareholders during the fourth quarter of the year ended
December 31, 2001.




PART II






|        |                                                                          
|------- | -------------------------------------------------------------------------
|Item 5. | Market for the Registrants Common
	Stock and Related Shareholder Matters

Our common shares are quoted on the Nasdaq
National Market under the symbol IPCR. The following
table sets out the high and low prices for our common shares for
the periods indicated as reported by the Nasdaq National Market.
Such prices reflect inter-dealer prices, without retail mark-up,
mark-down or commission, and do not necessarily represent actual
transactions.

|                             |                |      |   |       |  |  |   |       | 
|---------------------------- | -------------- | ---- | - | ----- |  |  | - | ----- | 
|                             |                | High |   | Low  
|                             |                |      |   |      
|Year ended December 31, 2001 |                |      |   |       |  |  |   |      
|                             | First Quarter  |      | $ | 24.50 |  |  | $ | 19.38 | 
|                             | Second Quarter |      |   | 25.05 |  |  |   | 18.50 | 
|                             | Third Quarter  |      |   | 24.75 |  |  |   | 18.90 | 
|                             | Fourth Quarter |      |   | 29.95 |  |  |   | 22.10 | 
|Year ended December 31, 2000 |                |      |   |       |  |  |   |      
|                             | First Quarter  |      | $ | 15.75 |  |  | $ | 9.75  | 
|                             | Second Quarter |      |   | 16.00 |  |  |   | 11.25 | 
|                             | Third Quarter  |      |   | 18.69 |  |  |   | 12.63 | 
|                             | Fourth Quarter |      |   | 22.88 |  |  |   | 18.50 | 

As of February 28, 2002, there were 67
holders of record of common shares.

In September, 2001, we paid a dividend of $0.16
per common share. We did not pay dividends during 2000. In each
of March, June, and September, 1999, we paid dividends of
$0.3175 per common share. In December 1999, we paid a dividend
of $0.16 per common share. The amount and timing of dividends is
at the discretion of our Board of Directors and is dependent
upon our profits and financial requirements, as well as loss
experience, business opportunities and any other factors that
the Board deems relevant. In addition, if we have funds
available for distribution, we may nevertheless determine that
such funds should be retained for the purposes of replenishing
capital, expanding premium writings or other purposes. We are a
holding company,

21



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##### Table of Contents



whose principal source of income is cash
dividends and other permitted payments from IPCRe. The payment
of dividends from IPCRe to us is restricted under Bermuda law
and regulation, including Bermuda insurance law and under
IPCRes $150 million revolving credit facility which
expires on June 30, 2003. The credit facility limits the
amount of dividends that may be paid quarterly by IPCRe to us to
the lesser of i) IPCRes aggregate positive net income
from March 31, 1998 to the end of the then-current fiscal
quarter over the aggregate amount of all dividends and
distributions paid during the same period, and
ii) IPCRes positive consolidated net income for the
four fiscal quarters then ending over the aggregate amount of
all dividends and distributions paid during the same period.


Under the Insurance Act, IPCRe is required to
maintain a solvency margin and a minimum liquidity ratio and is
prohibited from declaring or paying any dividends if to do so
would cause IPCRe to fail to meet its solvency margin and
minimum liquidity ratio. Under the Insurance Act, IPCRe is
prohibited from paying dividends of more than 25% of its total
statutory capital and surplus at the end of the previous fiscal
year unless it files an affidavit stating that the declaration
of such dividends has not caused to fail to meet its solvency
margin and minimum liquidity ratio. The Insurance Act also
prohibits IPCRe from declaring or paying dividends requirements
without the approval of the Supervisor of Insurance if IPCRe
failed to meet its solvency margin and minimum liquidity ratio
on the last day of the previous fiscal year. The maximum amount
of dividends which could be paid by IPCRe to IPC Holdings at
January 1, 2002 without such notification is approximately
$276 million. In addition, IPCRe is prohibited under the
Insurance Act from reducing its opening total statutory capital
by more than 15% without the approval of the Supervisor of
Insurance. As a result of these factors, there can be no
assurance that our dividend policy will not change or that we
will declare or pay any dividends.

22



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##### Table of Contents








|        |                        
|------- | -----------------------
|Item 6. | Selected Financial Data

The historical consolidated financial data
presented below as of and for each of the periods ended
December 31, 2001, 2000, 1999, 1998, and 1997 were derived
from our consolidated financial statements which are
incorporated herein by reference to the Annual Report. The
selected consolidated financial data should be read in
conjunction with our consolidated financial statements and
related notes thereto, and with Managements
Discussion and Analysis of Financial Condition and Results of
Operations also contained in the Annual Report and
incorporated herein by reference.

|                                            |  |                                          |            |      |  |      |            |      |  |      |            |   |  |   |            |   |  |   |            |  
|------------------------------------------- |  | ---------------------------------------- | ---------- | ---- |  | ---- | ---------- | ---- |  | ---- | ---------- | - |  | - | ---------- | - |  | - | ---------- | -
|                                            |  |                                         
|                                            |  | Year Ended December 31,                 
|                                            |  |                                         
|                                            |  | 2001                                     |            | 2000 |  | 1999 |            | 1998 |  | 1997
|                                            |  |                                          |            |      |  |      |            |      |  |     
|                                            |  |                                         
|                                            |  | (in thousands, except per share amounts)
|Statement of Income Data:                   |  |                                          |            |      |  |      |            |      |  |      |            |   |  |   |            |   |  |   |            |  
|Gross premiums written                      |  | $                                        | 133,057    |      |  | $    | 93,757     |      |  | $    | 97,162     |   |  | $ | 111,265    |   |  | $ | 117,050    |  
|Net premiums earned                         |  |                                          | 123,375    |      |  |      | 86,961     |      |  |      | 94,967     |   |  |   | 120,125    |   |  |   | 112,486    |  
|Net investment income                       |  |                                          | 32,245     |      |  |      | 31,089     |      |  |      | 30,327     |   |  |   | 30,053     |   |  |   | 29,883     |  
|Loss and loss adjustment expenses incurred  |  |                                          | 137,551    |      |  |      | 53,661     |      |  |      | 129,362    |   |  |   | 61,459     |   |  |   | 14,708     |  
|Acquisition costs                           |  |                                          | 12,686     |      |  |      | 9,049      |      |  |      | 13,028     |   |  |   | 16,968     |   |  |   | 13,487     |  
|General and administrative expenses         |  |                                          | 9,381      |      |  |      | 9,311      |      |  |      | 9,641      |   |  |   | 10,680     |   |  |   | 8,676      |  
|Exchange loss/(gain), net                   |  |                                          | 551        |      |  |      | 2,348      |      |  |      | 411        |   |  |   | 371        |   |  |   | 1,562      |  
|Realized gains/(losses), net on investments |  |                                          | 616        |      |  |      | 544        |      |  |      | 30,355     |   |  |   | 7,014      |   |  |   | (3,616     | )
|Net (loss) income                           |  | $                                        | (3,933     | )    |  | $    | 44,225     |      |  | $    | 3,207      |   |  | $ | 67,714     |   |  | $ | 100,320    |  
|Net (loss) income per common share(1)       |  | $                                        | (0.15      | )    |  | $    | 1.73       |      |  | $    | 0.12       |   |  | $ | 2.55       |   |  | $ | 3.79       |  
|Weighted average shares outstanding(1)      |  |                                          | 26,266,019 |      |  |      | 25,497,671 |      |  |      | 25,988,116 |   |  |   | 26,547,062 |   |  |   | 26,492,401 |  
|Dividend per common share(2)                |  | $                                        | 0.16       |      |  | $    |           |      |  | $    | 1.1125     |   |  | $ | 2.07       |   |  | $ | 3.27       |  
|Other Data:                                 |  |                                          |            |      |  |      |            |      |  |      |            |   |  |   |            |   |  |   |            |  
|Loss and loss adjustment expense ratio(3)   |  |                                          | 111.5      | %    |  |      | 61.7       | %    |  |      | 136.2      | % |  |   | 51.2       | % |  |   | 13.1       | %
|Expense ratio(3)                            |  |                                          | 17.9       | %    |  |      | 21.1       | %    |  |      | 23.9       | % |  |   | 23.0       | % |  |   | 19.7       | %
|Combined ratio(3)                           |  |                                          | 129.4      | %    |  |      | 82.8       | %    |  |      | 160.1      | % |  |   | 74.2       | % |  |   | 32.8       | %
|Return on average equity(4)                 |  |                                          | (0.7       | )%   |  |      | 8.3        | %    |  |      | 0.6        | % |  |   | 12.4       | % |  |   | 19.6       | %
|Balance Sheet Data (at end of
	period)      |  |                                          |            |      |  |      |            |      |  |      |            |   |  |   |            |   |  |   |            |  
|Total cash and investments                  |  | $                                        | 1,232,301  |      |  | $    | 598,531    |      |  | $    | 594,754    |   |  | $ | 599,981    |   |  | $ | 538,759    |  
|Reinsurance balances receivable             |  |                                          | 42,356     |      |  |      | 25,419     |      |  |      | 21,460     |   |  |   | 20,747     |   |  |   | 27,723     |  
|Total assets                                |  |                                          | 1,301,716  |      |  |      | 647,490    |      |  |      | 640,942    |   |  |   | 643,091    |   |  |   | 585,019    |  
|Reserve for losses and loss expenses        |  |                                          | 162,207    |      |  |      | 61,358     |      |  |      | 111,441    |   |  |   | 52,226     |   |  |   | 27,590     |  
|Unearned premiums                           |  |                                          | 24,440     |      |  |      | 19,068     |      |  |      | 16,364     |   |  |   | 17,602     |   |  |   | 26,462     |  
|Total shareholders investment              |  | $                                        | 1,105,794  |      |  | $    | 559,270    |      |  | $    | 504,931    |   |  | $ | 565,952    |   |  | $ | 528,293    |  
|Basic book value per common share           |  | $                                        | 22.95      |      |  | $    | 22.34      |      |  | $    | 20.17      |   |  | $ | 22.61      |   |  | $ | 21.12      |  
|Diluted book value per common share(5)      |  | $                                        | 22.92      |      |  | $    | 21.93      |      |  | $    | 19.43      |   |  | $ | 21.32      |   |  | $ | 19.94      |  




|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Net income per common share is based upon the
	weighted average number of common shares outstanding during the
	relevant period. The weighted average number of shares includes
	common shares and the dilutive effect of the AIG Option and
	employee stock options, using the treasury stock method. The net
	(loss) per common share for the year ended December 31,
	2001 is based on the actual number of shares outstanding during
	the period.
|   
|(2) | Dividend per common share is based on the number
	of average outstanding common shares during the years ended
	December 31, 2001, 2000, 1999, 1998, and 1997, respectively.                                                                                                                                                                                                                                                                          

23



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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(3) | The loss and loss adjustment expense ratio is
	calculated by dividing the losses and loss expenses incurred by
	the net premiums earned. The expense ratio is calculated by
	dividing the sum of acquisition costs and general and
	administrative expenses (excluding gains and losses from foreign
	exchange) by net premiums earned. The combined ratio is the sum
	of the loss and loss expense ratio and the expense ratio.                                                                    
|   
|(4) | Return on average equity equals the annual net
	(loss) income divided by the average of the shareholders
	investment on the first and last day of the respective period.                                                                                                                                                                                                                                                                                                                           
|   
|(5) | Diluted book value per common share is based on
	the number of common shares outstanding on the relevant date,
	after considering the effect of the AIG Option as of each date
	presented and after considering the effect of options granted to
	employees, calculated on the basis described in note (1)
	above. At December 31, 2001 the average weighted number of
	shares outstanding, including the dilutive effect of employee
	stock options using the treasury stock method was 48,250,491.






|        |                                                                                       
|------- | --------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis
	of Financial Condition and Results of Operations

The information required for this item is
incorporated herein by reference to the narrative contained
under the caption Managements Discussion and
Analysis of Financial Condition and Results of Operations
in the Annual Report.






|         |                                                            
|-------- | -----------------------------------------------------------
|Item 7A. | Quantitative and Qualitative Disclosures
	About Market Risk

The information required for this item is
incorporated herein by reference to the section entitled
Managements Discussion and Analysis 
Quantitative and Qualitative Disclosure about Market Risk
in the Annual Report.






|        |                                             
|------- | --------------------------------------------
|Item 8. | Financial Statements and Supplementary
	Data

The information required for this item is
incorporated herein by reference to the consolidated financial
statements of the Company contained in the Annual Report.






|        |                                                                                      
|------- | -------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with
	Accountants on Accounting and Financial Disclosure

None.




PART III






|         |                                  
|-------- | ---------------------------------
|Item 10. | Directors and Executive
	Officers

The information concerning directors required for
this item is incorporated herein by reference to the information
contained under the captions Election of Directors,
Executive Officers and Section 16(a)
Beneficial Ownership Reporting Compliance in the Proxy
Statement.






|         |                       
|-------- | ----------------------
|Item 11. | Executive Compensation

The information required for this item is
incorporated herein by reference to the information contained
under the caption Executive Compensation in the
Proxy Statement.






|         |                                                                
|-------- | ---------------------------------------------------------------
|Item 12. | Security Ownership of Certain Beneficial
	Owners and Management

The information required for this item is
incorporated herein by reference to the information contained
under the caption Beneficial Ownership of Common
Shares in the Proxy Statement.






|         |                                                
|-------- | -----------------------------------------------
|Item 13. | Certain Relationships and Related
	Transactions

The information required for this item is
incorporated herein by reference to the information contained
under the caption Certain Relationships and Related
Transactions in the Proxy Statement.

24



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##### Table of Contents






PART IV




Item 14.  Exhibits,
Financial Statement Schedules and Reports on
Form 8-K

(a) Financial Statements and Exhibits

1. Financial Statements

The following Consolidated Financial Statements
of IPC Holdings and Report of Independent Auditors are
incorporated herein by reference to pages xx to xx of the
Annual Report:



| |                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------
| | Report of Independent Public Accountants                                                                             
| | Consolidated balance sheets as of
	December 31, 2001 and 2000                                                        
| | Consolidated statements of (loss) income for
	the years ended December 31, 2001, 2000 and 1999                       
| | Consolidated statements of comprehensive income
	(loss) for the years ended December 31, 2001, 2000 and
	1999        
| | Consolidated statements of changes in
	shareholders investment for the years ended
	December 31, 2001, 2000 and 1999
| | Consolidated statements of cash flows for the
	years ended December 31, 2001, 2000 and 1999                          
| | Notes to the consolidated financial statements                                                                       

2. Financial Statement Schedules



| |                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------
| | Report of Independent Public Accountants on
	Schedules                                                                  
| | Schedule II  Condensed Financial
	Information of Registrant                                                            
| | Schedule III  Supplementary
	Insurance Information of Subsidiary for the years ended
	December 31, 2001, 2000 and 1999.
| | Schedule IV  Supplementary
	Information concerning Reinsurance for the years ended
	December 31, 2001, 2000 and 1999.  

Certain schedules have been omitted, either
because they are not applicable, or because the information is
included in our consolidated financial statements incorporated
by reference to the Annual Report.


3. Exhibits

|        |       |             |  |                                                                                                                                  |  |  |    | 
|------- | ----- | ----------- |  | -------------------------------------------------------------------------------------------------------------------------------- |  |  | -- | 
|Exhibit |       |             |  | Method                                                                                                                          
|Number  |       | Description |  | of filing                                                                                                                       
|        |       |             |  |                                                                                                                                 
|        | 3.1   |             |  | Memorandum of Association of the Company                                                                                         |  |  | *  | 
|        | 3.2   |             |  | Amended and Restated Bye-Laws of the Company                                                                                     |  |  | +  | 
|        | 3.3   |             |  | Form of Memorandum of Increase of Share Capital                                                                                  |  |  | *  | 
|        | 4.1   |             |  | Form of Registration Rights Agreement                                                                                            |  |  | *  | 
|        | 4.2   |             |  | Form of Share Certificate                                                                                                        |  |  | *  | 
|        | 10.1  |             |  | Termination Agreement among the Company and its
	previous shareholders                                                           |  |  | *  | 
|        | 10.2  |             |  | Form of Amended and Restated Option Agreement
	entered into between the Company and AIG                                          |  |  | *  | 
|        | 10.3 |             |  | Amended and Restated IPC Holdings, Ltd. Stock
	Option Plan                                                                       |  |  | oo | 
|        | 10.4 |             |  | IPCRe Defined Contribution Plan                                                                                                  |  |  | *  | 
|        | 10.5  |             |  | Amended and Restated Administrative Services
	Agreement among the Company, IPCRe and AICL                                        |  |  | *  | 
|        | 10.6  |             |  | Investment Management Agreement between IPCRe and
	AIGIC, as amended                                                             |  |  | ** | 
|        | 10.7  |             |  | Investment Sub-Advisory Agreement between AIGIC
	and AIGIC (Europe) (formerly known as Dempsey & Company
	International Limited) |  |  | *  | 
|        | 10.8  |             |  | Custodial Agreement between AIGTS and IPCRe                                                                                      |  |  | *  | 

25



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##### Table of Contents



|        |        |             |  |                                                                                                                           |  |  |                | 
|------- | ------ | ----------- |  | ------------------------------------------------------------------------------------------------------------------------- |  |  | -------------- | 
|Exhibit |        |             |  | Method                                                                                                                   
|Number  |        | Description |  | of filing                                                                                                                
|        |        |             |  |                                                                                                                          
|        | 10.9  |             |  | Retirement Agreement between IPCRe and James P.
	Bryce                                                                    |  |  | *              | 
|        | 10.10 |             |  | Retirement Agreement between IPCRe and Peter J.A.
	Cozens                                                                 |  |  | *              | 
|        | 10.11 |             |  | Amended and Restated IPC Holdings, Ltd. Deferred
	Compensation Plan                                                       |  |  | o              | 
|        | 10.12  |             |  | Credit Agreement between IPCRe Limited, the First
	National Bank of Chicago, and other Lenders named therein, as
	amended |  |  | +              | 
|        | 10.13  |             |  | Form of Limited Waiver to Credit Agreement
	between IPCRe Limited, BankOne N.A. and other Lenders named
	therein          |  |  | o              | 
|        | 10.14  |             |  | Purchase Agreement between the Company and AIG                                                                            |  |  | #              | 
|        | 10.15  |             |  | Underwriting Agency Agreement between Allied
	World Assurance Company Ltd. and IPCUSL                                     |  |  | Filed herewith | 
|        | 10.16  |             |  | Amended Schedule I (Investment Policy Guideline)
	to Investment Management Agreement between IPCRe and AIGIC              |  |  | Filed herewith | 
|        | 11.1   |             |  | Statement regarding Computation of Per Share
	Earnings                                                                    |  |  | Filed herewith | 
|        | 13.1   |             |  | Portions of the Annual Report incorporated herein
	by reference                                                           |  |  | Filed herewith | 
|        | 21.1   |             |  | Subsidiaries of the Registrant                                                                                            |  |  | Filed herewith | 
|        | 23.1   |             |  | Consent of Arthur Andersen                                                                                                |  |  | Filed herewith | 
|        | 99.0   |             |  | Representations of Arthur Andersen                                                                                        |  |  | Filed herewith | 




|   |  |                                                                                                                                                                                                                           
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|*  |  | Incorporated by reference to the corresponding
	exhibit in our Registration Statement on Form S-1
	(No. 333-00088).                                                                                                       
|+  |  | Incorporated by reference to Exhibit 4.2 to
	our Registration Statement on Form S-3 (No. 333-73828).                                                                                                                      
|** |  | Incorporated by reference to Exhibit 10.1 to
	the our Form 10-Q for the quarter ended June 30, 1997
	(File No. 0-27662), and Exhibit 10.1 to our
	Form 10-Q for the quarter ended June 30, 2001
	(File No. 0-27662).      
|++ |  | Incorporated by reference to Exhibits 10.1 and
	10.2 to our Form 10-Q for the quarter ended June 30,
	1998 (File No. 0-27662), and Exhibit 10.2 to our
	Form 10-Q for the quarter ended June 30, 2001
	(File No. 0-27662).
|o  |  | Incorporated by reference to Exhibits 10.1 and
	10.2 to our Form 10-Q for the quarter ended
	September 30, 1999 (File No. 0-27662).                                                                                       
|oo |  | Incorporated by reference to Exhibit 10.3 to
	our Form 10-K for the year ended December 31, 1999
	(File No. 0-27662).                                                                                                     
|#  |  | Incorporated by reference to Exhibit 10 to
	our Registration Statement on Form S-3 (No. 333-73828).                                                                                                                       
|  |  | Management contract or compensatory plan,
	contract or arrangement.                                                                                                                                                       

(b) Reports on Form 8-K.



| |                                                                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | On December 17, 2001 we filed a report on
	Form 8-K to report the issuance of a press release on
	December 12, 2001, announcing the closing of a public
	offering of IPC Holdings common shares, a concurrent
	private placement of shares to AIG and an option exercise by AIG.

26



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##### Table of Contents



IPC HOLDINGS, LTD.

INDEX TO SCHEDULES

|                                                       |              |  |    |                                                                                                         |  |  |    | 
|------------------------------------------------------ | ------------ |  | -- | ------------------------------------------------------------------------------------------------------- |  |  | -- | 
|SCHEDULE/REPORT                                        |              |  |    | Page                                                                                                   
|                                                       |              |  |    |                                                                                                        
|Report of Independent Public Accountants on
	Schedules |              |  | 28 |                                                                                                        
|                                                       | Schedule II  |  |    | Consolidated Financial Information of the
	Registrant                                                   |  |  | 29 | 
|                                                       | Schedule III |  |    | Supplementary Insurance Information of Subsidiary
	for the years ended December 31, 2001, 2000 and 1999 |  |  | 32 | 
|                                                       | Schedule IV  |  |    | Supplementary Information concerning Reinsurance
	for the years ended December 31, 2001, 2000 and 1999  |  |  | 33 | 

27



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##### Table of Contents



REPORT OF INDEPENDENT PUBLIC
ACCOUNTANTS

To the Board of Directors and Shareholders
of

IPC Holdings, Ltd.


We have audited in accordance with generally
accepted auditing standards the consolidated financial
statements of IPC Holdings, Ltd. and subsidiaries included in
IPC Holdings, Ltd.s annual report to shareholders
incorporated by reference in this Form 10-K, and have
issued our report thereon dated February 8, 2002. Our audit
was made for the purpose of forming an opinion on those
financial statements taken as a whole. The schedules listed in
the accompanying index are the responsibility of the
Companys management and are presented for purposes of
complying with the Securities and Exchange Commissions
rules and are not part of the basic financial statements. These
schedules have been subjected to the auditing procedures applied
in the audits of the basic financial statements and, in our
opinion, fairly state in all material respects the financial
data required to be set forth therein in relation to the basic
financial statements taken as a whole.

ARTHUR ANDERSEN

Hamilton, Bermuda

February 8, 2002


28



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##### Table of Contents



SCHEDULE II

IPC HOLDINGS, LTD.

CONDENSED FINANCIAL INFORMATION OF
REGISTRANT

BALANCE SHEET

(PARENT COMPANY)


(Expressed in thousands of United States
Dollars)


|                                                                                                                             |  |                    |           |      |  |   |         | 
|---------------------------------------------------------------------------------------------------------------------------- |  | ------------------ | --------- | ---- |  | - | ------- | 
|                                                                                                                             |  |                   
|                                                                                                                             |  | As of December 31,
|                                                                                                                             |  |                   
|                                                                                                                             |  | 2001               |           | 2000
|                                                                                                                             |  |                    |           |     
|ASSETS:                                                                                                                      |  |                    |           |      |  |   |         | 
|Cash                                                                                                                         |  | $                  | 163       |      |  | $ | 101     | 
|Investment in wholly-owned subsidiaries                                                                                      |  |                    | 1,108,332 |      |  |   | 561,462 | 
|Other assets                                                                                                                 |  |                    | 99        |      |  |   | 420     | 
|                                                                                                                             |  |                    |           |      |  |   |         | 
|                                                                                                                             |  | $                  | 1,108,594 |      |  | $ | 561,983 | 
|                                                                                                                             |  |                    |           |      |  |   |         | 
|LIABILITIES:                                                                                                                 |  |                    |           |      |  |   |         | 
|Payable to subsidiaries                                                                                                      |  | $                  | 2,229     |      |  | $ | 2,637   | 
|Other liabilities                                                                                                            |  |                    | 571       |      |  |   | 76      | 
|                                                                                                                             |  |                    |           |      |  |   |         | 
|                                                                                                                             |  |                    | 2,800     |      |  |   | 2,713   | 
|                                                                                                                             |  |                    |           |      |  |   |         | 
|SHAREHOLDERS INVESTMENT:                                                                                                    |  |                    |           |      |  |   |         | 
|Share capital  2001: 48,172,776 shares
	outstanding, par value $0.01; 2000: 25,039,713 shares
	outstanding, par value $0.01 |  |                    | 482       |      |  |   | 250     | 
|Additional paid in capital                                                                                                   |  |                    | 846,101   |      |  |   | 299,929 | 
|Retained earnings                                                                                                            |  |                    | 246,568   |      |  |   | 254,511 | 
|Accumulated other comprehensive income                                                                                       |  |                    | 12,643    |      |  |   | 4,580   | 
|                                                                                                                             |  |                    |           |      |  |   |         | 
|                                                                                                                             |  |                    | 1,105,794 |      |  |   | 559,270 | 
|                                                                                                                             |  |                    |           |      |  |   |         | 
|                                                                                                                             |  | $                  | 1,108,594 |      |  | $ | 561,983 | 
|                                                                                                                             |  |                    |           |      |  |   |         | 

29



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SCHEDULE II

continued


IPC HOLDINGS, LTD.

CONDENSED FINANCIAL INFORMATION OF
REGISTRANT  continued

STATEMENT OF (LOSS) INCOME

(PARENT COMPANY)


(Expressed in thousands of United States
Dollars)


|                                                                        |                                   |                         |        |      |  |      |        |     |  |   |       |     | 
|----------------------------------------------------------------------- | --------------------------------- | ----------------------- | ------ | ---- |  | ---- | ------ | --- |  | - | ----- | --- | 
|                                                                        |                                   |                        
|                                                                        |                                   | Year ended December 31,
|                                                                        |                                   |                        
|                                                                        |                                   | 2001                    |        | 2000 |  | 1999
|                                                                        |                                   |                         |        |      |  |     
|Interest income                                                         |                                   | $                       | 2      |      |  | $    | 3      |     |  | $ | 5     |    
|Expenses:                                                               |                                   |                         |        |      |  |      |        |     |  |   |       |    
|                                                                        | Operating costs and expenses, net |                         |        | 920  |  |      |        | 811 |  |   |       | 779 | 
|                                                                        |                                   |                         |        |      |  |      |        |     |  |   |       |    
|(Loss)/profit before equity in net income of
	wholly-owned subsidiaries |                                   |                         | (918   | )    |  |      | (808   | )   |  |   | (774  | )  
|Equity in net (loss) income of wholly-owned
	subsidiaries               |                                   |                         | (3,015 | )    |  |      | 45,033 |     |  |   | 3,981 |    
|                                                                        |                                   |                         |        |      |  |      |        |     |  |   |       |    
|Net (loss) income available to common
	shareholders                     |                                   | $                       | (3,933 | )    |  | $    | 44,225 |     |  | $ | 3,207 |    
|                                                                        |                                   |                         |        |      |  |      |        |     |  |   |       |    

STATEMENT OF COMPREHENSIVE INCOME
(LOSS)

(PARENT COMPANY)


(Expressed in thousands of United States
Dollars)


|                                   |                                                                        |      |        |       |   |      |        |        |   |   |         |         |  
|---------------------------------- | ---------------------------------------------------------------------- | ---- | ------ | ----- | - | ---- | ------ | ------ | - | - | ------- | ------- | -
|                                   |                                                                        | 2001 |        | 2000  |   | 1999
|                                   |                                                                        |      |        |       |   |     
|Net (loss) income                  |                                                                        | $    | (3,933 | )     |   | $    | 44,225 |        |   | $ | 3,207   |        
|                                   |                                                                        |      |        |       |   |      |        |        |   |   |         |        
|Other comprehensive income (loss): |                                                                        |      |        |       |   |      |        |        |   |   |         |        
|                                   | Holding gains (losses), net on investments during
	period              |      |        | 8,679 |   |      |        | 10,562 |   |   |         | (6,024  | )
|                                   | Reclassification adjustment for
	(gains) losses included in net income |      |        | (616  | ) |      |        | (544   | ) |   |         | (30,355 | )
|                                   |                                                                        |      |        |       |   |      |        |        |   |   |         |        
|                                   |                                                                        |      | 8,063  |       |   |      | 10,018 |        |   |   | (36,379 | )      
|                                   |                                                                        |      |        |       |   |      |        |        |   |   |         |        
|Comprehensive income (loss)        |                                                                        | $    | 4,130  |       |   | $    | 54,243 |        |   | $ | (33,172 | )      
|                                   |                                                                        |      |        |       |   |      |        |        |   |   |         |        

30



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SCHEDULE II

continued


IPC HOLDINGS, LTD.

CONDENSED FINANCIAL INFORMATION OF
REGISTRANT  continued

STATEMENT OF CASH FLOWS

(PARENT COMPANY)


(Expressed in thousands of United States
Dollars)


|                                                          |                                               |                         |          |       |      |      |        |         |       |   |         |        |     | 
|--------------------------------------------------------- | --------------------------------------------- | ----------------------- | -------- | ----- | ---- | ---- | ------ | ------- | ----- | - | ------- | ------ | --- | 
|                                                          |                                               |                        
|                                                          |                                               | Year ended December 31,
|                                                          |                                               |                        
|                                                          |                                               | 2001                    |          | 2000  |      | 1999
|                                                          |                                               |                         |          |       |      |     
|CASH FLOWS FROM OPERATING ACTIVITIES                      |                                               |                         |          |       |      |      |        |         |       |   |         |       
|Net (loss) income                                         |                                               | $                       | (3,933   | )     |      | $    | 44,225 |         |       | $ | 3,207   |       
|Adjustments to reconcile net income to cash
	provided by: |                                               |                         |          |       |      |      |        |         |       |   |         |       
|                                                          | Equity in net loss (income) from subsidiaries |                         |          | 3,015 |      |      |        | (45,033 | )     |   |         | (3,981 | )  
|                                                          | Changes in, net:                              |                         |          |       |      |      |        |         |       |   |         |        |    
|                                                          |                                               | Other assets            |          |       | 321  |      |        |         | 1,128 |   |         |        | 29  | 
|                                                          |                                               | Payable to subsidiaries |          |       | (408 | )    |        |         | (259  | ) |         |        | 415 | 
|                                                          |                                               | Other liabilities       |          |       | 495  |      |        |         | (78   | ) |         |        | 132 | 
|                                                          |                                               |                         |          |       |      |      |        |         |       |   |         |       
|                                                          |                                               |                         | (510     | )     |      |      | (17    | )       |       |   | (198    | )     
|                                                          |                                               |                         |          |       |      |      |        |         |       |   |         |       
|CASH FLOWS FROM FINANCING ACTIVITIES                      |                                               |                         |          |       |      |      |        |         |       |   |         |       
|Additional share capital received                         |                                               |                         | 546,404  |       |      |      | 96     |         |       |   |        |       
|Additional investment in subsidiaries                     |                                               |                         | (545,921 | )     |      |      |       |         |       |   |        |       
|Dividends received from subsidiaries                      |                                               |                         | 4,099    |       |      |      |       |         |       |   | 28,000  |       
|Dividends paid to shareholders                            |                                               |                         | (4,010   | )     |      |      |       |         |       |   | (27,849 | )     
|                                                          |                                               |                         |          |       |      |      |        |         |       |   |         |       
|                                                          |                                               |                         | 572      |       |      |      | 96     |         |       |   | 151     |       
|                                                          |                                               |                         |          |       |      |      |        |         |       |   |         |       
|Net increase (decrease) in cash and cash
	equivalents     |                                               |                         | 62       |       |      |      | 79     |         |       |   | (47     | )     
|Cash and cash equivalents, beginning of year              |                                               |                         | 101      |       |      |      | 22     |         |       |   | 69      |       
|                                                          |                                               |                         |          |       |      |      |        |         |       |   |         |       
|Cash and cash equivalents, end of year                    |                                               | $                       | 163      |       |      | $    | 101    |         |       | $ | 22      |       
|                                                          |                                               |                         |          |       |      |      |        |         |       |   |         |       

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SCHEDULE III

IPC HOLDINGS, LTD. AND SUBSIDIARIES

SUBSIDIARY SUPPLEMENTARY INSURANCE
INFORMATION

(Expressed in thousands of United States
Dollars)


|        |                    |             |   |                |  |          |   |         |  |            |   |            |  |              |   |           |  |          |   |        |  |  |   |         |  |  |   |        |  |  |   |       |  |  |   |         | 
|------- | ------------------ | ----------- | - | -------------- |  | -------- | - | ------- |  | ---------- | - | ---------- |  | ------------ | - | --------- |  | -------- | - | ------ |  |  | - | ------- |  |  | - | ------ |  |  | - | ----- |  |  | - | ------- | 
|        |                    |             |   | Future policy  |  |          |   |         |  |            |   | Benefits,  |  | Amortization |   |           |  |         
|        |                    | Deferred    |   | benefits,      |  |          |   |         |  |            |   | claims,    |  | of deferred  |   |           |  |         
|        |                    | policy      |   | losses, claims |  |          |   |         |  | Net        |   | losses and |  | policy       |   | Other     |  | Gross   
|        |                    | acquisition |   | and loss       |  | Unearned |   | Premium |  | investment |   | settlement |  | acquisition  |   | operating |  | premiums
|Segment |                    | costs       |   | expense        |  | premiums |   | revenue |  | income     |   | expenses   |  | costs        |   | expenses  |  | written 
|        |                    |             |   |                |  |          |   |         |  |            |   |            |  |              |   |           |  |         
|2001:   |                    |             |   |                |  |          |   |         |  |            |   |            |  |              |   |           |  |          |   |        |  |  |   |         |  |  |   |        |  |  |   |       |  |  |   |        
|        | Property & Similar |             | $ | 2,833          |  |          | $ | 162,207 |  |            | $ | 24,440     |  |              | $ | 123,375   |  |          | $ | 32,244 |  |  | $ | 137,551 |  |  | $ | 12,686 |  |  | $ | 8,443 |  |  | $ | 133,057 | 
|2000:   |                    |             |   |                |  |          |   |         |  |            |   |            |  |              |   |           |  |          |   |        |  |  |   |         |  |  |   |        |  |  |   |       |  |  |   |        
|        | Property & Similar |             | $ | 2,249          |  |          | $ | 61,358  |  |            | $ | 19,068     |  |              | $ | 86,961    |  |          | $ | 31,086 |  |  | $ | 53,661  |  |  | $ | 9,049  |  |  | $ | 8,427 |  |  | $ | 93,757  | 
|1999:   |                    |             |   |                |  |          |   |         |  |            |   |            |  |              |   |           |  |          |   |        |  |  |   |         |  |  |   |        |  |  |   |       |  |  |   |        
|        | Property & Similar |             | $ | 1,980          |  |          | $ | 111,441 |  |            | $ | 16,364     |  |              | $ | 94,967    |  |          | $ | 30,322 |  |  | $ | 129,362 |  |  | $ | 13,028 |  |  | $ | 8,912 |  |  | $ | 97,162  | 

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SCHEDULE IV

REINSURANCE

(Expressed in thousands of United States
Dollars)


|      |                    |              |   |           |  |            |   |               |  |                |   |         |  |  |   |         |  |  |  |     |  
|----- | ------------------ | ------------ | - | --------- |  | ---------- | - | ------------- |  | -------------- | - | ------- |  |  | - | ------- |  |  |  | --- | -
|      |                    |              |   | Ceded to  |  | Assumed    |   |               |  | Percentage of 
|      |                    |              |   | other     |  | from other |   |               |  | amount        
|      |                    | Gross Amount |   | companies |  | companies  |   | Net Amount(1) |  | assumed to net
|      |                    |              |   |           |  |            |   |               |  |               
|2001: |                    |              |   |           |  |            |   |               |  |                |   |         |  |  |   |         |  |  |  |    
|      | Property & Similar |              | $ |          |  |            | $ | 4,419         |  |                | $ | 133,057 |  |  | $ | 128,638 |  |  |  | 103 | %
|2000: |                    |              |   |           |  |            |   |               |  |                |   |         |  |  |   |         |  |  |  |    
|      | Property & Similar |              | $ |          |  |            | $ | 4,827         |  |                | $ | 93,757  |  |  | $ | 88,930  |  |  |  | 105 | %
|1999: |                    |              |   |           |  |            |   |               |  |                |   |         |  |  |   |         |  |  |  |    
|      | Property & Similar |              | $ |          |  |            | $ | 3,816         |  |                | $ | 97,162  |  |  | $ | 93,346  |  |  |  | 104 | %




|    |                 
|--- | ----------------
|(1) | Premiums Written

33



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##### Table of Contents



IPC HOLDINGS, LTD.

SIGNATURES

Pursuant to the requirements of Section 13
or 15(d) of the Securities Exchange Act of 1934, as amended, the
registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized, in
Pembroke, Bermuda, on the 20th day of March, 2002.



| |                   
| | ------------------
| | IPC HOLDINGS, LTD.








By: James P. Bryce


President and Chief Executive
Officer


Pursuant to the requirements of the Securities
Exchange Act of 1934, as amended, this report has been signed by
the following persons on behalf of the Registrant and in the
capacities indicated and on the dates indicated.

|                                                       |  |                                                 |  |               
|------------------------------------------------------ |  | ----------------------------------------------- |  | --------------
|Signature                                              |  | Title                                           |  | Date          
|                                                       |  |                                                 |  |               
|/s/ JOSEPH C.H. JOHNSONJoseph C.H. Johnson             |  | Chairman of the Board of Directors              |  | March 20, 2002
|                                                      
|/s/ JAMES P. BRYCEJames P. Bryce                       |  | President, Chief Executive Officer and Director |  | March 20, 2002
|                                                      
|/s/ JOHN R. WEALEJohn R. Weale                         |  | Vice President and Chief Financial Officer      |  | March 20, 2002
|                                                      
|/s/ FRANK MUTCHFrank Mutch                             |  | Deputy Chairman of Board of Directors           |  | March 20, 2002
|                                                      
|/s/ ANTHONY M. PILLINGAnthony M. Pilling               |  | Director                                        |  | March 20, 2002
|                                                      
|/s/ CLARENCE JAMESDr. The Honourable Clarence E. James |  | Director                                        |  | March 20, 2002
|                                                      
|/s/ JACKIE CLEGGJackie Clegg                           |  | Director                                        |  | March 20, 2002

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EXHIBIT INDEX

|        |        |             |  |                                                                                                                                                |  |  |                | 
|------- | ------ | ----------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------- |  |  | -------------- | 
|Exhibit |        |             |  | Method                                                                                                                                        
|Number  |        | Description |  | of filing                                                                                                                                     
|        |        |             |  |                                                                                                                                               
|        | 3.1    |             |  | Memorandum of Association of the Company                                                                                                       |  |  | *              | 
|        | 3.2    |             |  | Amended and Restated Bye-Laws of the Company                                                                                                   |  |  | +              | 
|        | 3.3    |             |  | Form of Memorandum of Increase of Share Capital                                                                                                |  |  | *              | 
|        | 4.1    |             |  | Form of Registration Rights Agreement                                                                                                          |  |  | *              | 
|        | 4.2    |             |  | Form of Share Certificate                                                                                                                      |  |  | *              | 
|        | 10.1   |             |  | Termination Agreement among the Company and its
        previous shareholders                                                                  |  |  | *              | 
|        | 10.2   |             |  | Form of Amended and Restated Option Agreement
        entered into between the Company and AIG                                                 |  |  | *              | 
|        | 10.3  |             |  | Amended and Restated IPC Holdings, Ltd. Stock
        Option Plan                                                                              |  |  | oo             | 
|        | 10.4  |             |  | IPCRe Defined Contribution Plan                                                                                                                |  |  | *              | 
|        | 10.5   |             |  | Amended and Restated Administrative Services
        Agreement among the Company, IPCRe and AICL                                               |  |  | *              | 
|        | 10.6   |             |  | Investment Management Agreement between IPCRe and
        AIGIC, as amended                                                                    |  |  | **             | 
|        | 10.7   |             |  | Investment Sub-Advisory Agreement between AIGIC
        and AIGIC (Europe) (formerly known as Dempsey & Company
        International Limited) |  |  | *              | 
|        | 10.8   |             |  | Custodial Agreement between AIGTS and IPCRe                                                                                                    |  |  | *              | 
|        | 10.9  |             |  | Retirement Agreement between IPCRe and James P.
        Bryce                                                                                  |  |  | *              | 
|        | 10.10 |             |  | Retirement Agreement between IPCRe and Peter J.A.
        Cozens                                                                               |  |  | *              | 
|        | 10.11 |             |  | Amended and Restated IPC Holdings, Ltd. Deferred
        Compensation Plan                                                                     |  |  | o              | 
|        | 10.12  |             |  | Credit Agreement between IPCRe Limited, the First
        National Bank of Chicago, and other Lenders named therein, as
        amended        |  |  | +              | 
|        | 10.13  |             |  | Form of Limited Waiver to Credit Agreement
        between IPCRe Limited, BankOne N.A. and other Lenders named
        therein                 |  |  | o              | 
|        | 10.14  |             |  | Purchase Agreement between the Company and AIG                                                                                                 |  |  | #              | 
|        | 10.15  |             |  | Underwriting Agency Agreement between Allied
        World Assurance Company Ltd. and IPCUSL                                                   |  |  | Filed herewith | 
|        | 10.16  |             |  | Amended Schedule I (Investment Policy Guideline)
        to Investment Management Agreement between IPCRe and AIGIC                            |  |  | Filed herewith | 
|        | 11.1   |             |  | Statement regarding Computation of Per Share
        Earnings                                                                                  |  |  | Filed herewith | 
|        | 13.1   |             |  | Portions of the Annual Report incorporated herein
        by reference                                                                         |  |  | Filed herewith | 
|        | 21.1   |             |  | Subsidiaries of the Registrant                                                                                                                 |  |  | Filed herewith | 
|        | 23.1   |             |  | Consent of Arthur Andersen                                                                                                                     |  |  | Filed herewith | 
|        | 99.0   |             |  | Representations of Arthur Andersen                                                                                                             |  |  | Filed herewith | 




|   |  |                                                                                                                                                                                                                                                       
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|*  |  | Incorporated by reference to the corresponding
        exhibit in our Registration Statement on Form S-1
        (No. 333-00088).                                                                                                                     
|+  |  | Incorporated by reference to Exhibit 4.2 to
        our Registration Statement on Form S-3 (No. 333-73828)                                                                                                                                            
|** |  | Incorporated by reference to Exhibit 10.1 to
        the our Form 10-Q for the quarter ended June 30, 1997
        (File No. 0-27662), and Exhibit 10.1 to our
        Form 10-Q for the quarter ended June 30, 2001
        (File No. 0-27662).      
|++ |  | Incorporated by reference to Exhibits 10.1 and
        10.2 to our Form 10-Q for the quarter ended June 30,
        1998 (File No. 0-27662), and Exhibit 10.2 to our
        Form 10-Q for the quarter ended June 30, 2001
        (File No. 0-27662).
|o  |  | Incorporated by reference to Exhibits 10.1 and
        10.2 to our Form 10-Q for the quarter ended
        September 30, 1999 (File No. 0-27662).                                                                                                     
|oo |  | Incorporated by reference to Exhibit 10.3 to
        our Form 10-K for the year ended December 31, 1999
        (File 0-27662).                                                                                                                       
|#  |  | Incorporated by reference to Exhibit 10 to
        our Registration Statement on Form S-3 (No. 333-73828).                                                                                                                                            
|  |  | Management contract or compensatory plan,
        contract or arrangement.