##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2005
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the transition period from ___to ___
 Commission File Number 001-31341
 Platinum Underwriters Holdings, Ltd.
  Bermuda
(State or other jurisdiction of
incorporation or organization)
    
    98-0416483
(IRS Employer Identification No.)
 The Belvedere Building
69 Pitts Bay Road
Pembroke, Bermuda
(Address of principal executive offices)
    
    HM
08
(Zip Code)
 (Registrants telephone number, including area code)
 (Former name, former address and former fiscal year, if changed since last report)
 þ o
 þ o
 o þ




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PagePART I  FINANCIAL INFORMATIONItem 1. Condensed Consolidated Financial StatementsConsolidated Balance Sheets as of September 30, 2005 (Unaudited) and
December 31, 2004
    
    
    1Consolidated Statements of Income and Comprehensive Income for the
Three and Nine months ended September 30, 2005 and 2004 (Unaudited)
    
    
    2Consolidated Statements of Changes in Shareholders Equity for the Nine
Months
Ended September 30, 2005 and 2004 (Unaudited)
    
    
    3Consolidated Statements of Cash Flows for the Nine Months Ended
September 30, 2005 and 2004 (Unaudited)
    
    
    4Notes to Condensed Consolidated Financial Statements (Unaudited) for the
Three and Nine Months Ended September 30, 2005 and 2004
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations for the Three and Nine Months Ended September 30, 2005 and 2004
    
    
    25Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    51Item 4. Controls and Procedures
    
    
    53PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    54Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    54Item 6. Exhibits
    
    
    55SIGNATURES
    
    
    55EX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATIONEX-32.2: CERTIFICATION




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 Platinum Underwriters Holdings, Ltd. and Subsidiaries
 
 
 (Unaudited)September 30,
    
    
    December 31,2005
    
    
    2004ASSETSInvestments:Fixed maturities available-for-sale, at fair value
(amortized cost  $2,917,948 and $2,144,290, respectively)
    
    $
    2,886,969
    
    
    $
    2,157,529Fixed maturities  trading, at fair value
(amortized cost  $96,392 and $82,931, respectively)
    
    
    96,248
    
    
    
    82,673Other invested asset
    
    
    6,000
    
    
    
    6,769Total investments
    
    
    2,989,217
    
    
    
    2,246,971Cash and cash equivalents
    
    
    391,637
    
    
    
    209,897Accrued investment income
    
    
    31,013
    
    
    
    23,663Reinsurance premiums receivable
    
    
    557,422
    
    
    
    580,048Reinsurance recoverable on ceded losses and loss adjustment
expenses
    
    
    68,276
    
    
    
    2,005Prepaid reinsurance premiums
    
    
    10,745
    
    
    
    2,887Funds held by ceding companies
    
    
    250,324
    
    
    
    198,048Deferred acquisition costs
    
    
    139,158
    
    
    
    136,038Income tax recoverable
    
    
    10,106
    
    
    
    1,325Deferred tax assets
    
    
    27,290
    
    
    
    8,931Other assets
    
    
    10,897
    
    
    
    12,182Total assets
    
    $
    4,486,085
    
    
    $
    3,421,995LIABILITIES AND SHAREHOLDERS EQUITYLiabilities:Unpaid losses and loss adjustment expenses
    
    $
    2,079,668
    
    
    $
    1,380,955Unearned premiums
    
    
    558,881
    
    
    
    502,423Reinsurance deposit liabilities
    
    
    5,932
    
    
    
    20,189Debt obligations
    
    
    387,500
    
    
    
    137,500Ceded premiums payable
    
    
    26,278
    
    
    
    2,384Commissions payable
    
    
    176,036
    
    
    
    181,925Funds withheld
    
    
    
    
    
    
    11,999Deferred taxes
    
    
    
    
    
    
    10,404Other liabilities
    
    
    23,973
    
    
    
    41,213Total liabilities
    
    
    3,258,268
    
    
    
    2,288,992Shareholders Equity:Preferred shares, $.01 par value, 25,000,000 shares
authorized, no shares issued or outstanding
    
    
    
    
    
    
    Common shares, $.01 par value, 200,000,000 shares
authorized, 49,604,759 and 43,087,407 shares
issued and outstanding, respectively
    
    
    496
    
    
    
    430Additional paid-in capital
    
    
    1,092,029
    
    
    
    911,851Unearned share grant compensation
    
    
    (2,108
    )
    
    
    Accumulated other comprehensive income (loss)
    
    
    (25,718
    )
    
    
    12,252Retained earnings
    
    
    163,118
    
    
    
    208,470Total shareholders equity
    
    
    1,227,817
    
    
    
    1,133,003Total liabilities and shareholders equity
    
    $
    4,486,085
    
    
    $
    3,421,995
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 
 
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2004
    
    
    2005
    
    
    2004Revenue:Net premiums earned
    
    $
    429,388
    
    
    
    383,090
    
    
    
    1,271,898
    
    
    $
    1,014,999Net investment income
    
    
    36,441
    
    
    
    21,429
    
    
    
    92,250
    
    
    
    58,290Net realized gains (losses) on investments
    
    
    (879
    )
    
    
    2,262
    
    
    
    (1,062
    )
    
    
    1,435Other income (expense)
    
    
    (433
    )
    
    
    1,021
    
    
    
    (201
    )
    
    
    2,137Total revenue
    
    
    464,517
    
    
    
    407,802
    
    
    
    1,362,885
    
    
    
    1,076,861Expenses:Losses and loss adjustment expenses
    
    
    564,618
    
    
    
    384,724
    
    
    
    1,043,168
    
    
    
    736,159Acquisition expenses
    
    
    98,858
    
    
    
    81,271
    
    
    
    296,035
    
    
    
    232,886Operating expenses
    
    
    8,080
    
    
    
    15,400
    
    
    
    51,568
    
    
    
    53,436Net foreign currency exchange (gains)
losses
    
    
    (88
    )
    
    
    (628
    )
    
    
    1,870
    
    
    
    (326
    )Interest expense
    
    
    6,839
    
    
    
    2,322
    
    
    
    13,186
    
    
    
    6,952Total expenses
    
    
    678,307
    
    
    
    483,089
    
    
    
    1,405,827
    
    
    
    1,029,107Income (loss) before income tax
expense
    
    
    (213,790
    )
    
    
    (75,287
    )
    
    
    (42,942
    )
    
    
    47,754Income tax expense (benefit)
    
    
    (37,766
    )
    
    
    (5,535
    )
    
    
    (7,991
    )
    
    
    12,893Net income (loss)
    
    $
    (176,024
    )
    
    
    (69,752
    )
    
    
    (34,951
    )
    
    $
    34,861Earnings per share:Basic earnings (loss) per share
    
    $
    (4.02
    )
    
    
    (1.62
    )
    
    
    (0.80
    )
    
    $
    0.81Diluted earnings (loss) per share
    
    $
    (4.02
    )
    
    
    (1.62
    )
    
    
    (0.80
    )
    
    $
    0.78Comprehensive income (loss):Net income (loss)
    
    $
    (176,024
    )
    
    
    (69,752
    )
    
    
    (34,951
    )
    
    $
    34,861Other comprehensive income (loss):Net change in unrealized gains and
losses on available-for-sale
securities, net of deferred taxes
    
    
    (36,414
    )
    
    
    31,147
    
    
    
    (37,992
    )
    
    
    (2,036
    )Cumulative translation adjustments,
net of deferred taxes
    
    
    59
    
    
    
    (140
    )
    
    
    22
    
    
    
    (292
    )Comprehensive income (loss)
    
    $
    (212,379
    )
    
    
    (38,745
    )
    
    
    (72,921
    )
    
    $
    32,533Shareholder dividends:Dividends declared
    
    $
    3,490
    
    
    
    3,435
    
    
    
    10,401
    
    
    $
    10,360Dividends declared per share
    
    $
    0.08
    
    
    
    0.08
    
    
    
    0.24
    
    
    $
    0.24
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 
 
 2005
    
    
    2004Preferred shares:Balances at beginning and end of period
    
    $
    
    
    
    $
    Common shares:Balances at beginning of period
    
    
    430
    
    
    
    430Exercise of share options
    
    
    7
    
    
    
    2Issuance of restricted shares and shares for share units
    
    
    1
    
    
    
    1Issuance of common shares
    
    
    58
    
    
    
    Purchase of common shares
    
    
    
    
    
    
    (3
    )Balances at end of period
    
    
    496
    
    
    
    430Additional paid-in-capital:Balances at beginning of period
    
    
    911,851
    
    
    
    910,505Exercise of share options
    
    
    13,063
    
    
    
    5,834Issuance of restricted shares and shares for share units
    
    
    2,749
    
    
    
    1,736Share based compensation
    
    
    2,559
    
    
    
    1,565Issuance of common shares
    
    
    161,807
    
    
    
    Purchase of common shares
    
    
    
    
    
    
    (9,982
    )Balances at end of period
    
    
    1,092,029
    
    
    
    909,658Unearned share grant compensation :Balances at beginning of period
    
    
    
    
    
    
    Shares issued
    
    
    (2,750
    )
    
    
    Amortization
    
    
    642
    
    
    
    Balances at end of period
    
    
    (2,108
    )
    
    
    Accumulated other comprehensive income (loss):Balances at beginning of period
    
    
    12,252
    
    
    
    18,774Net change in unrealized gains and losses on
available-for-sale securities, net of deferred taxes
    
    
    (37,992
    )
    
    
    (2,036
    )Net change in cumulative translation adjustments, net
of deferred tax
    
    
    22
    
    
    
    (292
    )Balances at end of period
    
    
    (25,718
    )
    
    
    16,446Retained earnings:Balances at beginning of period
    
    
    208,470
    
    
    
    137,494Net income (loss)
    
    
    (34,951
    )
    
    
    34,861Dividends paid to shareholders
    
    
    (10,401
    )
    
    
    (10,360
    )Balances at end of period
    
    
    163,118
    
    
    
    161,995Total shareholders equity
    
    $
    1,227,817
    
    
    $
    1,088,529
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 
 
 2005
    
    
    2004Operating Activities:Net income (loss)
    
    $
    (34,951
    )
    
    $
    34,861Adjustments to reconcile net income (loss) to cash used in
operations:Depreciation and amortization
    
    
    13,361
    
    
    
    15,676Net realized losses on investments
    
    
    1,062
    
    
    
    (1,435
    )Net foreign currency exchange losses
    
    
    1,870
    
    
    
    (326
    )Share-based compensation
    
    
    3,301
    
    
    
    1,736Trading securities activities
    
    
    (14,195
    )
    
    
    13,026Changes in assets and liabilities:Increase in accrued investment income
    
    
    (7,350
    )
    
    
    (9,121
    )(Increase) decrease in reinsurance premiums receivable
    
    
    22,626
    
    
    
    (151,022
    )Increase in funds held by ceding companies
    
    
    (52,276
    )
    
    
    (20,720
    )Increase in deferred acquisition costs
    
    
    (3,120
    )
    
    
    (62,693
    )Increase in net unpaid losses and loss adjustment expenses
    
    
    638,669
    
    
    
    488,814Increase in net unearned premiums
    
    
    48,600
    
    
    
    234,382Increase (decrease) in reinsurance deposit liabilities
    
    
    (14,257
    )
    
    
    17,511Increase (decrease) in ceded premiums payable
    
    
    23,894
    
    
    
    (2,354
    )Increase (decrease) in commissions payable
    
    
    (5,889
    )
    
    
    44,592Increase (decrease) in funds withheld
    
    
    (11,999
    )
    
    
    22,487Changes in other assets and liabilities
    
    
    (47,927
    )
    
    
    (2,051
    )Other net
    
    
    (2,399
    )
    
    
    (193
    )Net cash provided by operating activities
    
    
    559,020
    
    
    
    623,170Investing Activities:Proceeds from sale of available-for-sale fixed maturities
    
    
    478,134
    
    
    
    307,551Proceeds from maturity or paydown of available-for-sale fixed
maturities
    
    
    97,070
    
    
    
    117,117Acquisition of available-for-sale fixed maturities
    
    
    (1,363,918
    )
    
    
    (916,443
    )Net cash used in investing activities
    
    
    (788,714
    )
    
    
    (491,775
    )Financing Activities:Dividends paid to shareholders
    
    
    (10,401
    )
    
    
    (10,360
    )Proceeds from exercise of share options
    
    
    13,070
    
    
    
    5,836Proceeds from issuance of debt
    
    
    246,900
    
    
    
    Proceeds from issuance of common shares
    
    
    161,865
    
    
    
    Purchase of common shares
    
    
    
    
    
    
    (9,985
    )Net cash provided by (used in) financing activities
    
    
    411,434
    
    
    
    (14,509
    )Net increase in cash and cash equivalents
    
    
    181,740
    
    
    
    116,886Cash and cash equivalents at beginning of period
    
    
    209,897
    
    
    
    105,461Cash and cash equivalents at end of period
    
    $
    391,637
    
    
    $
    222,347Supplemental disclosures of cash flow information:Income taxes paid
    
    $
    32,507
    
    
    $
    2,533Interest paid
    
    $
    7,219
    
    
    $
    7,219
 
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Platinum Underwriters Holdings, Ltd. and Subsidiaries
 
 
 (1) Basis of Presentation
    - 5 -




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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Share-Based Compensation
     Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2004
    
    
    2005
    
    
    2004Share-based compensation expense:As reported
    
    $
    908
    
    
    
    649
    
    
    
    2,710
    
    
    $
    1,736Pro forma
    
    
    2,140
    
    
    
    1,855
    
    
    
    6,256
    
    
    
    5,200
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2004
    
    
    2005
    
    
    2004Net income (loss):As reported
    
    $
    (176,024
    )
    
    
    (69,752
    )
    
    
    (34,951
    )
    
    $
    34,861Pro forma
    
    
    (177,256
    )
    
    
    (70,958
    )
    
    
    (38,497
    )
    
    
    31,397Basic earnings (loss) per share:As reported
    
    
    (4.02
    )
    
    
    (1.62
    )
    
    
    (0.80
    )
    
    
    0.81Pro forma
    
    
    (4.05
    )
    
    
    (1.66
    )
    
    
    (0.89
    )
    
    
    0.72Diluted earnings (loss) per share:As reported
    
    
    (4.02
    )
    
    
    (1.62
    )
    
    
    (0.80
    )
    
    
    0.78Pro forma
    
    $
    (4.05
    )
    
    
    (1.66
    )
    
    
    (0.89
    )
    
    $
    0.71
  Reclassifications
  (2) Investments
  2005
    
    
    2004Fixed maturities
    
    $
    (44,218
    )
    
    $
    (3,261
    )Less  deferred taxes
    
    
    6,226
    
    
    
    1,225Net change in unrealized investment gains and losses
    
    $
    (37,992
    )
    
    $
    (2,036
    )
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
  UnrealizedFair Value
    
    
    LossLess than twelve months:U.S. Government and U.S. Government agencies
    
    $
    129,041
    
    
    $
    (1,156
    )Corporate bonds
    
    
    1,071,601
    
    
    
    (15,578
    )Mortgage and asset backed securities
    
    
    802,091
    
    
    
    (9,609
    )Municipal bonds
    
    
    139,090
    
    
    
    (1,177
    )Foreign governments and states
    
    
    28,044
    
    
    
    (401
    )Redeemable preferred stocks
    
    
    8,375
    
    
    
    (360
    )Total
    
    
    2,178,242
    
    
    
    (28,281
    )Twelve months or more:U.S. Government and U.S. Government agencies
    
    
    3,429
    
    
    
    (7
    )Corporate bonds
    
    
    154,002
    
    
    
    (4,600
    )Mortgage and asset backed securities
    
    
    67,914
    
    
    
    (2,354
    )Municipal bonds
    
    
    38,218
    
    
    
    (878
    )Foreign governments and states
    
    
    11,151
    
    
    
    (407
    )Total
    
    
    274,714
    
    
    
    (8,246
    )Total of securities with unrealized losses:U.S. Government and U.S. Government agencies
    
    
    132,470
    
    
    
    (1,163
    )Corporate bonds
    
    
    1,225,603
    
    
    
    (20,178
    )Mortgage and asset backed securities
    
    
    870,005
    
    
    
    (11,963
    )Municipal bonds
    
    
    177,308
    
    
    
    (2,055
    )Foreign governments and states
    
    
    39,195
    
    
    
    (808
    )Redeemable preferred stocks
    
    
    8,375
    
    
    
    (360
    )Total
    
    $
    2,452,956
    
    
    $
    (36,527
    )
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
  (3) Hurricane Losses
   2005
    
    
    2004Gross losses and LAE
    
    $
    396,923
    
    
    $
    186,457Retrocessional reinsurance
    
    
    (56,083
    )
    
    
    Net losses and LAE
    
    
    340,840
    
    
    
    186,457Additional premiums earned
    
    
    (19,554
    )
    
    
    (19,895
    )Profit commissions
    
    
    
    
    
    
    (10,350
    )Net adverse impact on underwriting results
    
    $
    321,286
    
    
    $
    156,212
  (4) Earnings Per Share
  WeightedNet
    
    
    Average
    
    
    EarningsIncome
    
    
    Shares
    
    
    (Loss)(loss)
    
    
    Outstanding
    
    
    Per ShareThree Months Ended September 30, 2005:Basic loss per share:Loss available to common shareholders
    
    $
    (176,024
    )
    
    
    43,785
    
    
    $
    (4.02
    )
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 WeightedNet
    
    
    Average
    
    
    EarningsIncome
    
    
    Shares
    
    
    (Loss)(loss)
    
    
    Outstanding
    
    
    Per ShareThree Months Ended September 30, 2004:Basic loss per share:Loss available to common shareholders
    
    $
    (69,752
    )
    
    
    43,127
    
    
    $
    (1.62
    )Nine Months Ended September 30, 2005:Basic loss per share:Loss available to common shareholders
    
    
    (34,951
    )
    
    
    43,459
    
    
    
    (0.80
    )Nine Months Ended September 30, 2004:Basic earnings per shareIncome available to common shareholders
    
    
    34,861
    
    
    
    43,186
    
    
    
    0.81Diluted earnings per share:Share options and restricted share units
    
    
    
    
    
    
    2,227Interest expense related to ESUs
    
    
    4,577
    
    
    
    Common share conversion of ESUs
    
    
    
    
    
    
    5,009Diluted earnings per share:
    
    $
    39,438
    
    
    
    50,422
    
    
    $
    0.78
 (5) Operating Segment Information
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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Propertyand Marine
    
    
    Casualty
    
    
    Finite Risk
    
    
    TotalThree months ended September 30,
2005:Net premiums written
    
    $
    133,350
    
    
    
    216,659
    
    
    
    60,177
    
    
    $
    410,186Net premiums earned
    
    
    145,853
    
    
    
    205,050
    
    
    
    78,485
    
    
    
    429,388Losses and LAE
    
    
    373,761
    
    
    
    129,218
    
    
    
    61,639
    
    
    
    564,618Acquisition expenses
    
    
    17,753
    
    
    
    50,097
    
    
    
    31,008
    
    
    
    98,858Other underwriting expenses
    
    
    3,632
    
    
    
    1,894
    
    
    
    524
    
    
    
    6,050Segment underwriting income (loss)
    
    $
    (249,293
    )
    
    
    23,841
    
    
    
    (14,686
    )
    
    
    (240,138
    )Net investment income and net realized losses on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35,562Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    88Other expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (433
    )Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,030
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,839
    )Loss before income tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (213,790
    )Ratios:Losses and LAE
    
    
    256.3
    %
    
    
    63.0
    %
    
    
    78.5
    %
    
    
    131.5
    %Acquisition expense
    
    
    12.2
    %
    
    
    24.4
    %
    
    
    39.5
    %
    
    
    23.0
    %Other underwriting expense
    
    
    2.5
    %
    
    
    0.9
    %
    
    
    0.7
    %
    
    
    1.4
    %Combined
    
    
    271.0
    %
    
    
    88.3
    %
    
    
    118.7
    %
    
    
    155.9
    %Three months ended September 30,
2004:Net premiums written
    
    $
    120,629
    
    
    
    171,967
    
    
    
    147,899
    
    
    $
    440,495Net premiums earned
    
    
    135,430
    
    
    
    156,512
    
    
    
    91,148
    
    
    
    383,090Losses and LAE
    
    
    195,495
    
    
    
    105,559
    
    
    
    83,670
    
    
    
    384,724Acquisition expenses
    
    
    20,834
    
    
    
    38,935
    
    
    
    21,502
    
    
    
    81,271Other underwriting expenses
    
    
    5,956
    
    
    
    5,617
    
    
    
    661
    
    
    
    12,234Segment underwriting income (loss)
    
    $
    (86,855
    )
    
    
    6,401
    
    
    
    (14,685
    )
    
    
    (95,139
    )Net investment income and net realized gains on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,691Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    628Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,021Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,166
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,322
    )Loss before income tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (75,287
    )Ratios:Losses and LAE
    
    
    144.4
    %
    
    
    67.4
    %
    
    
    91.8
    %
    
    
    100.4
    %Acquisition expense
    
    
    15.4
    %
    
    
    24.9
    %
    
    
    23.6
    %
    
    
    21.2
    %Other underwriting expense
    
    
    4.4
    %
    
    
    3.6
    %
    
    
    0.7
    %
    
    
    3.2
    %Combined
    
    
    164.2
    %
    
    
    95.9
    %
    
    
    116.1
    %
    
    
    124.8
    %
 - 11 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Propertyand Marine
    
    
    Casualty
    
    
    Finite Risk
    
    
    TotalNine months ended September 30, 2005:Net premiums written
    
    $
    453,352
    
    
    
    621,218
    
    
    
    252,374
    
    
    $
    1,326,944Net premiums earned
    
    
    414,719
    
    
    
    588,541
    
    
    
    268,638
    
    
    
    1,271,898Losses and LAE
    
    
    492,300
    
    
    
    375,187
    
    
    
    175,681
    
    
    
    1,043,168Acquisition expenses
    
    
    69,437
    
    
    
    143,262
    
    
    
    83,336
    
    
    
    296,035Other underwriting expenses
    
    
    19,595
    
    
    
    18,179
    
    
    
    3,428
    
    
    
    41,202Segment underwriting income (loss)
    
    $
    (166,613
    )
    
    
    51,913
    
    
    
    6,193
    
    
    
    (108,507
    )Net investment income and net realized losses on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    91,188Net foreign currency exchange losses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,870
    )Other expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (201
    )Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,366
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,186
    )Loss before income tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (42,942
    )Ratios:Losses and LAE
    
    
    118.7
    %
    
    
    63.7
    %
    
    
    65.4
    %
    
    
    82.0
    %Acquisition expense
    
    
    16.7
    %
    
    
    24.3
    %
    
    
    31.0
    %
    
    
    23.3
    %Other underwriting expense
    
    
    4.7
    %
    
    
    3.1
    %
    
    
    1.3
    %
    
    
    3.2
    %Combined
    
    
    140.1
    %
    
    
    91.1
    %
    
    
    97.7
    %
    
    
    108.5
    %Nine months ended September 30, 2004:Net premiums written
    
    $
    393,764
    
    
    
    508,693
    
    
    
    348,671
    
    
    $
    1,251,128Net premiums earned
    
    
    353,423
    
    
    
    424,964
    
    
    
    236,612
    
    
    
    1,014,999Losses and LAE
    
    
    285,047
    
    
    
    293,734
    
    
    
    157,378
    
    
    
    736,159Acquisition expenses
    
    
    57,491
    
    
    
    105,765
    
    
    
    69,630
    
    
    
    232,886Other underwriting expenses
    
    
    21,280
    
    
    
    15,979
    
    
    
    5,825
    
    
    
    43,084Segment underwriting income (loss)
    
    $
    (10,395
    )
    
    
    9,486
    
    
    
    3,779
    
    
    
    2,870Net investment income and net realized gains on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59,725Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    326Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,137Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,352
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,952
    )Income before income tax expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    47,754Ratios:Losses and LAE
    
    
    80.7
    %
    
    
    69.1
    %
    
    
    66.5
    %
    
    
    72.5
    %Acquisition expense
    
    
    16.3
    %
    
    
    24.9
    %
    
    
    29.4
    %
    
    
    22.9
    %Other underwriting expense
    
    
    6.0
    %
    
    
    3.8
    %
    
    
    2.5
    %
    
    
    4.2
    %Combined
    
    
    103.0
    %
    
    
    97.8
    %
    
    
    98.4
    %
    
    
    99.6
    %
 - 12 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 (6) Income Taxes
   Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2004
    
    
    2005
    
    
    2004Expected income tax expense
(benefit) at 35%
    
    $
    (74,827
    )
    
    
    (26,350
    )
    
    
    (15,030
    )
    
    $
    16,714Effect of foreign income
subject to tax at rates
other than 35%
    
    
    38,528
    
    
    
    21,299
    
    
    
    270
    
    
    
    (3,042
    )Tax exempt
investment (income) loss
    
    
    (1,047
    )
    
    
    360
    
    
    
    (2,011
    )
    
    
    (601
    )U.S. withholding tax on
deemed taxable transfer to
foreign affiliate
    
    
    (1,000
    )
    
    
    
    
    
    
    8,150
    
    
    
    Other, net
    
    
    580
    
    
    
    (844
    )
    
    
    630
    
    
    
    (178
    )Income tax expense (benefit)
    
    $
    (37,766
    )
    
    
    (5,535
    )
    
    
    (7,991
    )
    
    $
    12,893
  (7) Debt and Equity Transactions
 Debt Offering
  - 13 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
   ESU remarketing
  Common Share Offering
  (8) Regulatory Examination
  - 14 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
  (9) Condensed Consolidating Financial Information
    - 15 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Non-Condensed Consolidating Balance Sheet
    
    Platinum
    
    
    Platinum
    
    
    guarantor
    
    
    ConsolidatingSeptember 30, 2005
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedASSETSInvestments:Fixed maturities available-for-sale, at fair
value
    
    $
    
    
    
    
    12,652
    
    
    
    2,874,317
    
    
    
    
    
    
    $
    2,886,969Fixed maturity trading securities at fair
value
    
    
    
    
    
    
    
    
    
    
    96,248
    
    
    
    
    
    
    
    96,248Other invested asset
    
    
    
    
    
    
    
    
    
    
    6,000
    
    
    
    
    
    
    
    6,000Total investments
    
    
    
    
    
    
    12,652
    
    
    
    2,976,565
    
    
    
    
    
    
    
    2,989,217Investment in subsidiaries
    
    
    1,051,375
    
    
    
    428,112
    
    
    
    330,235
    
    
    
    (1,809,722
    )
    
    
    Cash and cash equivalents
    
    
    176,593
    
    
    
    23,184
    
    
    
    191,860
    
    
    
    
    
    
    
    391,637Reinsurance assets
    
    
    
    
    
    
    
    
    
    
    2,706,714
    
    
    
    (1,680,789
    )
    
    
    1,025,925Other assets
    
    
    2,015
    
    
    
    7,581
    
    
    
    169,710
    
    
    
    (100,000
    )
    
    
    79,306Total assets
    
    $
    1,229,983
    
    
    
    471,529
    
    
    
    6,375,084
    
    
    
    (3,590,511
    )
    
    $
    4,486,085LIABILITIES AND SHAREHOLDERS EQUITYLiabilities:Reinsurance liabilities
    
    $
    
    
    
    
    
    
    
    
    4,527,024
    
    
    
    (1,680,229
    )
    
    $
    2,846,795Debt obligations
    
    
    
    
    
    
    387,500
    
    
    
    
    
    
    
    
    
    
    
    387,500Other liabilities
    
    
    2,330
    
    
    
    7,521
    
    
    
    14,842
    
    
    
    (720
    )
    
    
    23,973Total liabilities
    
    
    2,330
    
    
    
    395,021
    
    
    
    4,541,866
    
    
    
    (1,680,949
    )
    
    
    3,258,268Shareholders Equity:Preferred shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common shares
    
    
    496
    
    
    
    
    
    
    
    1,250
    
    
    
    (1,250
    )
    
    
    496Additional paid-in capital
    
    
    1,092,027
    
    
    
    51,533
    
    
    
    1,442,134
    
    
    
    (1,493,665
    )
    
    
    1,092,029Unearned share based comp
    
    
    (2,108
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,108
    )Accumulated other comprehensive income
    
    
    (25,718
    )
    
    
    (6,728
    )
    
    
    (32,759
    )
    
    
    39,487
    
    
    
    (25,718
    )Retained earnings
    
    
    162,956
    
    
    
    31,703
    
    
    
    422,593
    
    
    
    (454,134
    )
    
    
    163,118Total shareholders equity
    
    
    1,227,653
    
    
    
    76,508
    
    
    
    1,833,218
    
    
    
    (1,909,562
    )
    
    
    1,227,817Total liabilities and shareholders equity
    
    $
    1,229,983
    
    
    
    471,529
    
    
    
    6,375,084
    
    
    
    (3,590,511
    )
    
    $
    4,486,085
 - 16 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Condensed Consolidating Balance Sheet
    
    Platinum
    
    
    Platinum
    
    
    Non-guarantor
    
    
    ConsolidatingDecember 31, 2004
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedASSETSInvestments:Fixed maturities
available-for-sale, at fair value
    
    $
    
    
    
    
    3,740
    
    
    
    2,153,789
    
    
    
    
    
    
    $
    2,157,529Fixed maturity trading securities
at fair value
    
    
    
    
    
    
    
    
    
    
    82,673
    
    
    
    
    
    
    
    82,673Other invested asset
    
    
    
    
    
    
    
    
    
    
    6,769
    
    
    
    
    
    
    
    6,769Total investments
    
    
    
    
    
    
    3,740
    
    
    
    2,243,231
    
    
    
    
    
    
    
    2,246,971Investment in subsidiaries
    
    
    1,135,434
    
    
    
    414,105
    
    
    
    470,776
    
    
    
    (2,020,315
    )
    
    
    Cash and cash equivalents
    
    
    1,945
    
    
    
    8,204
    
    
    
    199,748
    
    
    
    
    
    
    
    209,897Reinsurance assets
    
    
    
    
    
    
    
    
    
    
    2,009,245
    
    
    
    (1,090,219
    )
    
    
    919,026Other assets
    
    
    1,648
    
    
    
    1,502
    
    
    
    142,951
    
    
    
    (100,000
    )
    
    
    46,101Total assets
    
    $
    1,139,027
    
    
    
    427,551
    
    
    
    5,065,951
    
    
    
    (3,210,534
    )
    
    $
    3,421,995LIABILITIES AND SHAREHOLDERS
EQUITYLiabilities:Reinsurance liabilities
    
    $
    
    
    
    
    
    
    
    
    3,233,233
    
    
    
    (1,133,358
    )
    
    $
    2,099,875Debt obligations
    
    
    
    
    
    
    137,500
    
    
    
    
    
    
    
    
    
    
    
    137,500Other liabilities
    
    
    6,024
    
    
    
    928
    
    
    
    1,525
    
    
    
    43,140
    
    
    
    51,617Total liabilities
    
    
    6,024
    
    
    
    138,428
    
    
    
    3,234,758
    
    
    
    (1,090,218
    )
    
    
    2,288,992Shareholders Equity:Preferred shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common shares
    
    
    430
    
    
    
    
    
    
    
    1,250
    
    
    
    (1,250
    )
    
    
    430Additional paid-in capital
    
    
    911,851
    
    
    
    147,238
    
    
    
    1,417,032
    
    
    
    (1,564,270
    )
    
    
    911,851Accumulated other comprehensive
income
    
    
    12,252
    
    
    
    3,309
    
    
    
    17,068
    
    
    
    (20,377
    )
    
    
    12,252Retained earnings
    
    
    208,470
    
    
    
    138,576
    
    
    
    395,843
    
    
    
    (534,419
    )
    
    
    208,470Total shareholders equity
    
    
    1,133,003
    
    
    
    289,123
    
    
    
    1,831,193
    
    
    
    (2,120,316
    )
    
    
    1,133,003Total liabilities and
shareholders equity
    
    $
    1,139,027
    
    
    
    427,551
    
    
    
    5,065,951
    
    
    
    (3,210,534
    )
    
    $
    3,421,995
 - 17 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Consolidating Statement of Income
    
    
    
    
    
    
    
    
    
    Non-For the Nine Months Ended
    
    Platinum
    
    
    Platinum
    
    
    guarantor
    
    
    ConsolidatingSeptember 30, 2005
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedRevenue:Net premiums earned
    
    $
    
    
    
    
    
    
    
    
    1,271,739
    
    
    
    159
    
    
    $
    1,271,898Net investment income
    
    
    225
    
    
    
    551
    
    
    
    91,558
    
    
    
    (84
    )
    
    
    92,250Net realized gains (losses) on investments
    
    
    
    
    
    
    8
    
    
    
    (1,070
    )
    
    
    
    
    
    
    (1,062
    )Other income (expense)
    
    
    3,500
    
    
    
    
    
    
    
    93,595
    
    
    
    (97,296
    )
    
    
    (201
    )Total revenue
    
    
    3,725
    
    
    
    559
    
    
    
    1,455,822
    
    
    
    (97,221
    )
    
    
    1,362,885Expenses:Losses and loss adjustment expenses
    
    
    
    
    
    
    
    
    
    
    1,043,168
    
    
    
    
    
    
    
    1,043,168Acquisition expenses
    
    
    
    
    
    
    
    
    
    
    299,559
    
    
    
    (3,524
    )
    
    
    296,035Operating expenses
    
    
    9,668
    
    
    
    439
    
    
    
    38,020
    
    
    
    3,441
    
    
    
    51,568Net foreign currency exchange losses
    
    
    2
    
    
    
    
    
    
    
    1,868
    
    
    
    
    
    
    
    1,870Interest expense
    
    
    66
    
    
    
    13,120
    
    
    
    
    
    
    
    
    
    
    
    13,186Total expenses
    
    
    9,736
    
    
    
    13,559
    
    
    
    1,382,615
    
    
    
    (83
    )
    
    
    1,405,827Loss before income tax benefit
    
    
    (6,011
    )
    
    
    (13,000
    )
    
    
    73,207
    
    
    
    (97,138
    )
    
    
    (42,942
    )Income tax benefit
    
    
    
    
    
    
    (4,550
    )
    
    
    (3,441
    )
    
    
    
    
    
    
    (7,991
    )Net loss before equity in loss of
subsidiaries
    
    
    (6,011
    )
    
    
    (8,450
    )
    
    
    76,648
    
    
    
    (97,138
    )
    
    
    (34,951
    )Equity in loss of subsidiaries
    
    
    (28,940
    )
    
    
    (1,128
    )
    
    
    (32,898
    )
    
    
    62,966
    
    
    
    Net loss
    
    $
    (34,951
    )
    
    
    (9,578
    )
    
    
    43,750
    
    
    
    (34,172
    )
    
    $
    (34,951
    )
 - 18 -




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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Consolidating Statement of Income
    
    
    
    
    
    
    
    
    
    Non-For the Nine Months Ended
    
    Platinum
    
    
    Platinum
    
    
    guarantor
    
    
    ConsolidatingSeptember 30, 2004
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedRevenue:Net premiums earned
    
    $
    
    
    
    
    
    
    
    
    1,014,799
    
    
    
    200
    
    
    $
    1,014,999Net investment income
    
    
    40
    
    
    
    122
    
    
    
    58,128
    
    
    
    
    
    
    
    58,290Net realized gains on investments
    
    
    
    
    
    
    
    
    
    
    1,435
    
    
    
    
    
    
    
    1,435Other income (expense)
    
    
    4,500
    
    
    
    
    
    
    
    (2,582
    )
    
    
    219
    
    
    
    2,137Total revenue
    
    
    4,540
    
    
    
    122
    
    
    
    1,071,780
    
    
    
    419
    
    
    
    1,076,861Expenses:Losses and loss adjustment expenses
    
    
    
    
    
    
    
    
    
    
    736,159
    
    
    
    
    
    
    
    736,159Acquisition expenses
    
    
    
    
    
    
    
    
    
    
    236,179
    
    
    
    (3,293
    )
    
    
    232,886Operating expenses
    
    
    9,921
    
    
    
    214
    
    
    
    40,008
    
    
    
    3,293
    
    
    
    53,436Net foreign currency exchange gains
    
    
    (1
    )
    
    
    
    
    
    
    (325
    )
    
    
    
    
    
    
    (326
    )Interest expense
    
    
    167
    
    
    
    6,785
    
    
    
    
    
    
    
    
    
    
    
    6,952Total expenses
    
    
    10,087
    
    
    
    6,999
    
    
    
    1,012,021
    
    
    
    
    
    
    
    1,029,107Income (loss) before income tax
expense
    
    
    (5,547
    )
    
    
    (6,877
    )
    
    
    59,759
    
    
    
    419
    
    
    
    47,754Income tax expense (benefit)
    
    
    
    
    
    
    (2,407
    )
    
    
    15,300
    
    
    
    
    
    
    
    12,893Net income (loss) before equity
in earnings of subsidiaries
    
    
    (5,547
    )
    
    
    (4,470
    )
    
    
    44,459
    
    
    
    419
    
    
    
    34,861Equity in earnings of subsidiaries
    
    
    40,408
    
    
    
    34,176
    
    
    
    46,266
    
    
    
    (120,850
    )
    
    
    Net income
    
    $
    34,861
    
    
    
    29,706
    
    
    
    90,725
    
    
    
    (120,431
    )
    
    $
    34,861
 - 19 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Consolidating Statement of Income
    
    
    
    
    
    
    
    
    
    Non-For the Three Months Ended
    
    Platinum
    
    
    Platinum
    
    
    guarantor
    
    
    ConsolidatingSeptember 30, 2005
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedRevenue:Net premiums earned
    
    $
    
    
    
    
    
    
    
    
    429,229
    
    
    
    159
    
    
    $
    429,388Net investment income
    
    
    153
    
    
    
    295
    
    
    
    36,077
    
    
    
    (84
    )
    
    
    36,441Net realized gains (losses) on investments
    
    
    
    
    
    
    7
    
    
    
    (886
    )
    
    
    
    
    
    
    (879
    )Other income (expense)
    
    
    3,500
    
    
    
    
    
    
    
    (3,933
    )
    
    
    
    
    
    
    (433
    )Total revenue
    
    
    3,653
    
    
    
    302
    
    
    
    460,487
    
    
    
    75
    
    
    
    464,517Expenses:Losses and loss adjustment expenses
    
    
    
    
    
    
    
    
    
    
    564,618
    
    
    
    
    
    
    
    564,618Acquisition expenses
    
    
    
    
    
    
    
    
    
    
    99,345
    
    
    
    (487
    )
    
    
    98,858Operating expenses
    
    
    1,795
    
    
    
    131
    
    
    
    5,751
    
    
    
    403
    
    
    
    8,080Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    (88
    )
    
    
    
    
    
    
    (88
    )Interest expense
    
    
    13
    
    
    
    6,826
    
    
    
    
    
    
    
    
    
    
    
    6,839Total expenses
    
    
    1,808
    
    
    
    6,957
    
    
    
    669,626
    
    
    
    (84
    )
    
    
    678,307Loss before income tax benefit
    
    
    1,845
    
    
    
    (6,655
    )
    
    
    (209,139
    )
    
    
    159
    
    
    
    (213,790
    )Income tax benefit
    
    
    
    
    
    
    (2,329
    )
    
    
    (35,437
    )
    
    
    
    
    
    
    (37,766
    )Net income (loss) before equity in
loss of subsidiaries
    
    
    1,845
    
    
    
    (4,326
    )
    
    
    (173,702
    )
    
    
    159
    
    
    
    (176,024
    )Equity in loss of subsidiaries
    
    
    (177,869
    )
    
    
    (37,728
    )
    
    
    (74,343
    )
    
    
    289,940
    
    
    
    Net loss
    
    $
    (176,024
    )
    
    
    (42,054
    )
    
    
    (248,045
    )
    
    
    290,099
    
    
    $
    (176,024
    )
 - 20 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Consolidating Statement of Income
    
    
    
    
    
    
    
    
    
    Non-For the Three Months Ended
    
    Platinum
    
    
    Platinum
    
    
    guarantor
    
    
    ConsolidatingSeptember 30, 2004
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedRevenue:Net premiums earned
    
    $
    
    
    
    
    
    
    
    
    382,892
    
    
    
    198
    
    
    $
    383,090Net investment income
    
    
    8
    
    
    
    43
    
    
    
    21,378
    
    
    
    
    
    
    
    21,429Net realized gains on investments
    
    
    
    
    
    
    
    
    
    
    2,262
    
    
    
    
    
    
    
    2,262Other income
    
    
    
    
    
    
    
    
    
    
    1,021
    
    
    
    
    
    
    
    1,021Total revenue
    
    
    8
    
    
    
    43
    
    
    
    407,553
    
    
    
    198
    
    
    
    407,802Expenses:Losses and loss adjustment expenses
    
    
    
    
    
    
    
    
    
    
    384,724
    
    
    
    
    
    
    
    384,724Acquisition expenses
    
    
    
    
    
    
    
    
    
    
    82,089
    
    
    
    (818
    )
    
    
    81,271Operating expenses
    
    
    2,972
    
    
    
    76
    
    
    
    11,533
    
    
    
    819
    
    
    
    15,400Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    (628
    )
    
    
    
    
    
    
    (628
    )Interest expense
    
    
    48
    
    
    
    2,274
    
    
    
    
    
    
    
    
    
    
    
    2,322Total expenses
    
    
    3,020
    
    
    
    2,350
    
    
    
    477,718
    
    
    
    1
    
    
    
    483,089Loss before income tax benefit
    
    
    (3,012
    )
    
    
    (2,307
    )
    
    
    (70,165
    )
    
    
    197
    
    
    
    (75,287
    )Income tax benefit
    
    
    
    
    
    
    (808
    )
    
    
    (4,727
    )
    
    
    
    
    
    
    (5,535
    )Net loss before equity in
earnings of subsidiaries
    
    
    (3,012
    )
    
    
    (1,499
    )
    
    
    (65,438
    )
    
    
    197
    
    
    
    (69,752
    )Equity in earnings of subsidiaries
    
    
    (66,740
    )
    
    
    1,530
    
    
    
    11,768
    
    
    
    53,442
    
    
    
    Net income
    
    $
    (69,752
    )
    
    
    31
    
    
    
    (53,670
    )
    
    
    53,639
    
    
    $
    (69,752
    )
 - 21 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Condensed Consolidating Statement of Cash
Flows
    
    
    
    
    
    
    
    
    
    Non-For the Nine Months Ended
    
    Platinum
    
    
    Platinum
    
    
    guarantor
    
    
    ConsolidatingSeptember 30, 2005
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedNet cash provided by (used in)
operating activities
    
    $
    (6,885
    )
    
    
    (4,872
    )
    
    
    570,777
    
    
    
    
    
    
    $
    559,020Investing Activities:Proceeds from sale of
available-for-sale fixed maturities
    
    
    
    
    
    
    2,983
    
    
    
    475,151
    
    
    
    
    
    
    
    478,134Proceeds from maturity or paydown of
available-for-sale fixed maturities
    
    
    
    
    
    
    316
    
    
    
    96,754
    
    
    
    
    
    
    
    97,070Acquisition of available-for-sale fixed
maturities
    
    
    
    
    
    
    (12,347
    )
    
    
    (1,351,571
    )
    
    
    
    
    
    
    (1,363,918
    )Dividends from subsidiaries
    
    
    202,000
    
    
    
    
    
    
    
    
    
    
    
    (202,000
    )
    
    
    Contributions to subsidiaries
    
    
    (185,000
    )
    
    
    (25,000
    )
    
    
    
    
    
    
    210,000
    
    
    
    Proceeds from sale of subsidiary shares
    
    
    
    
    
    
    
    
    
    
    193,000
    
    
    
    (193,000
    )
    
    
    Net cash provided by (used in) investing
activities
    
    
    17,000
    
    
    
    (34,048
    )
    
    
    (586,666
    )
    
    
    (185,000
    )
    
    
    (788,714
    )Financing Activities:Dividends paid to shareholders
    
    
    (10,401
    )
    
    
    
    
    
    
    (202,000
    )
    
    
    202,000
    
    
    
    (10,401
    )Proceeds from exercise of share options
    
    
    13,070
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,070Proceeds from issuance of debt
    
    
    
    
    
    
    246,900
    
    
    
    
    
    
    
    
    
    
    
    246,900Purchase of common shares
    
    
    
    
    
    
    (193,000
    )
    
    
    
    
    
    
    193,000
    
    
    
    Proceeds from issuance of common shares
    
    
    161,865
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    161,865Capital contribution from parent
    
    
    
    
    
    
    
    
    
    
    210,000
    
    
    
    (210,000
    )
    
    
    Net cash provided by financing activities
    
    
    164,534
    
    
    
    53,900
    
    
    
    8,000
    
    
    
    185,000
    
    
    
    411,434Net increase (decrease) in cash and cash
equivalents
    
    
    174,649
    
    
    
    14,980
    
    
    
    (7,889
    )
    
    
    
    
    
    
    181,740Cash and cash equivalents at beginning of
period
    
    
    1,945
    
    
    
    8,204
    
    
    
    199,748
    
    
    
    
    
    
    
    209,897Cash and cash equivalents at end of period
    
    $
    176,594
    
    
    
    23,184
    
    
    
    191,859
    
    
    
    
    
    
    $
    391,637
 - 22 -




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##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
 Condensed Consolidating Statement of Cash
Flows
    
    
    
    
    
    
    
    
    
    Non-For the Nine Months Ended
    
    Platinum
    
    
    Platinum
    
    
    guarantor
    
    
    ConsolidatingSeptember 30, 2004
    
    Holdings
    
    
    Finance
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    ConsolidatedNet cash provided by (used in)
operating activities
    
    $
    (2,319
    )
    
    
    (5,617
    )
    
    
    631,106
    
    
    
    
    
    
    $
    623,170Investing Activities:Proceeds from sale of
available-for-sale fixed maturities
    
    
    
    
    
    
    
    
    
    
    307,551
    
    
    
    
    
    
    
    307,551Proceeds from maturity or paydown of
available-for-sale fixed maturities
    
    
    
    
    
    
    572
    
    
    
    116,545
    
    
    
    
    
    
    
    117,117Acquisition of available-for-sale fixed
maturities
    
    
    
    
    
    
    (2,973
    )
    
    
    (913,470
    )
    
    
    
    
    
    
    (916,443
    )Dividends from subsidiaries
    
    
    14,500
    
    
    
    
    
    
    
    
    
    
    
    (14,500
    )
    
    
    Contributions to subsidiaries
    
    
    (250
    )
    
    
    
    
    
    
    
    
    
    
    250
    
    
    
    Net cash provided by (used in) investing
activities
    
    
    14,250
    
    
    
    (2,401
    )
    
    
    (489,374
    )
    
    
    (14,250
    )
    
    
    (491,775
    )Financing Activities:Dividends paid to shareholders
    
    
    (10,360
    )
    
    
    
    
    
    
    (14,500
    )
    
    
    14,500
    
    
    
    (10,360
    )Proceeds from exercise of share options
    
    
    5,836
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,836Purchase of common shares
    
    
    (9,985
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,985
    )Capital contribution from parent
    
    
    
    
    
    
    
    
    
    
    250
    
    
    
    (250
    )
    
    
    Net cash used in financing activities
    
    
    (14,509
    )
    
    
    
    
    
    
    (14,250
    )
    
    
    14,250
    
    
    
    (14,509
    )Net increase (decrease) in cash and cash
equivalents
    
    
    (2,578
    )
    
    
    (8,018
    )
    
    
    127,482
    
    
    
    
    
    
    
    116,886Cash and cash equivalents at beginning of
period
    
    
    3,414
    
    
    
    9,917
    
    
    
    92,130
    
    
    
    
    
    
    
    105,461Cash and cash equivalents at end of period
    
    $
    836
    
    
    
    1,899
    
    
    
    219,612
    
    
    
    
    
    
    $
    222,347
 (10) Subsequent Events
    - 23 -




---



##### Table of Contents



Platinum Underwriters Holdings, Ltd. and Subsidiaries
   
 - 24 -




---



##### Table of Contents



ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
 FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
 Business Overview
      - 25 -




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##### Table of Contents



Results of Operations
 Three Months Ended September 30, 2005 as Compared with the Three Months Ended September 30,
2004
  2005
    
    
    2004
    
    
    IncreaseNet loss
    
    $
    (176,024
    )
    
    
    (69,752
    )
    
    $
    (106,272
    )
  - 26 -




---



##### Table of Contents



2005
    
    
    2004Gross losses and LAE
    
    $
    396,923
    
    
    $
    186,457Retrocessional reinsurance
    
    
    (56,083
    )
    
    
    Net losses and LAE
    
    
    340,840
    
    
    
    186,457Additional premiums earned
    
    
    (19,554
    )
    
    
    (19,895
    )Profit commissions
    
    
    
    
    
    
    (10,350
    )Net adverse impact on underwriting results
    
    
    321,286
    
    
    
    156,212Income tax benefit
    
    
    (46,500
    )
    
    
    (11,403
    )Net adverse impact on net income
    
    $
    274,786
    
    
    $
    144,809
   Increase2005
    
    
    2004
    
    
    (decrease)Net premiums written
    
    $
    410,186
    
    
    
    440,495
    
    
    $
    (30,309
    )Net premiums earned
    
    $
    429,388
    
    
    
    383,090
    
    
    $
    46,298
   - 27 -




---



##### Table of Contents



2005
    
    
    2004
    
    
    IncreaseLosses and LAE
    
    $
    564,618
    
    
    
    384,724
    
    
    $
    179,894Losses and LAE ratios
    
    
    131.5
    %
    
    
    100.4
    %
    
    31.1 points
   2005
    
    
    2004
    
    
    IncreaseAcquisition expenses
    
    $
    98,858
    
    
    
    81,271
    
    
    $
    17,587Acquisition expense ratios
    
    
    23.0
    %
    
    
    21.2
    %
    
    1.8 points
   - 28 -




---



##### Table of Contents



2005
    
    
    2004
    
    
    IncreaseIncome tax benefit
    
    $
    (37,766
    )
    
    
    (5,535
    )
    
    $
    (32,231
    )Effective income tax rates
    
    
    17.7
    %
    
    
    7.4
    %
    
    10.3 points
  Nine Months Ended September 30, 2005 as Compared with the Nine Months Ended September 30,
2004
  2005
    
    2004
    
    DecreaseNet income (loss)
    
    $
    (34,951
    )
    
    
    34,861
    
    
    $
    (69,812
    )
   2005
    
    
    2004
    
    
    IncreaseNet premiums written
    
    $
    1,326,944
    
    
    
    1,251,128
    
    
    $
    75,816Net premiums earned
    
    $
    1,271,898
    
    
    
    1,014,999
    
    
    $
    256,899
 - 29 -




---



##### Table of Contents



2005
    
    
    2004
    
    
    IncreaseLosses and LAE
    
    $
    1,043,168
    
    
    
    736,159
    
    
    $
    307,009Loss and LAE ratios
    
    
    82.0
    %
    
    
    72.5
    %
    
    9.5 points
  - 30 -




---



##### Table of Contents



2005
    
    
    2004
    
    
    IncreaseAcquisition expenses
    
    $
    296,035
    
    
    
    232,886
    
    
    $
    63,149Acquisition expense ratios
    
    
    23.3
    %
    
    
    22.9
    %
    
    0.4 points
     2005
    
    
    2004
    
    
    DecreaseIncome tax expense (benefit)
    
    $
    (7,991
    )
    
    
    12,893
    
    
    $
    (20,884
    )Effective income tax rates
    
    
    18.6
    %
    
    
    27.0
    %
    
    (8.4) points
  Segment Information
  - 31 -




---



##### Table of Contents



Propertyand Marine
    
    
    Casualty
    
    
    Finite Risk
    
    
    TotalThree months ended September 30,
2005:Net premiums written
    
    $
    133,350
    
    
    
    216,659
    
    
    
    60,177
    
    
    $
    410,186Net premiums earned
    
    
    145,853
    
    
    
    205,050
    
    
    
    78,485
    
    
    
    429,388Losses and LAE
    
    
    373,761
    
    
    
    129,218
    
    
    
    61,639
    
    
    
    564,618Acquisition expenses
    
    
    17,753
    
    
    
    50,097
    
    
    
    31,008
    
    
    
    98,858Other underwriting expenses
    
    
    3,632
    
    
    
    1,894
    
    
    
    524
    
    
    
    6,050Segment underwriting income (loss)
    
    $
    (249,293
    )
    
    
    23,841
    
    
    
    (14,686
    )
    
    
    (240,138
    )Net investment income and net realized losses on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35,562Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    88Other expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (433
    )Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,030
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,839
    )Loss before income tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (213,790
    )Ratios:Losses and LAE
    
    
    256.3
    %
    
    
    63.0
    %
    
    
    78.5
    %
    
    
    131.5
    %Acquisition expense
    
    
    12.2
    %
    
    
    24.4
    %
    
    
    39.5
    %
    
    
    23.0
    %Other underwriting expense
    
    
    2.5
    %
    
    
    0.9
    %
    
    
    0.7
    %
    
    
    1.4
    %Combined
    
    
    271.0
    %
    
    
    88.3
    %
    
    
    118.7
    %
    
    
    155.9
    %Three months ended September 30,
2004:Net premiums written
    
    $
    120,629
    
    
    
    171,967
    
    
    
    147,899
    
    
    $
    440,495Net premiums earned
    
    
    135,430
    
    
    
    156,512
    
    
    
    91,148
    
    
    
    383,090Losses and LAE
    
    
    195,495
    
    
    
    105,559
    
    
    
    83,670
    
    
    
    384,724Acquisition expenses
    
    
    20,834
    
    
    
    38,935
    
    
    
    21,502
    
    
    
    81,271Other underwriting expenses
    
    
    5,956
    
    
    
    5,617
    
    
    
    661
    
    
    
    12,234Segment underwriting income (loss)
    
    $
    (86,855
    )
    
    
    6,401
    
    
    
    (14,685
    )
    
    
    (95,139
    )Net investment income and net realized gains on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,691Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    628Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,021Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,166
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,322
    )Loss before income tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (75,287
    )Ratios:Losses and LAE
    
    
    144.4
    %
    
    
    67.4
    %
    
    
    91.8
    %
    
    
    100.4
    %Acquisition expense
    
    
    15.4
    %
    
    
    24.9
    %
    
    
    23.6
    %
    
    
    21.2
    %Other underwriting expense
    
    
    4.4
    %
    
    
    3.6
    %
    
    
    0.7
    %
    
    
    3.2
    %Combined
    
    
    164.2
    %
    
    
    95.9
    %
    
    
    116.1
    %
    
    
    124.8
    %
 - 32 -




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##### Table of Contents



Propertyand Marine
    
    
    Casualty
    
    
    Finite Risk
    
    
    TotalNine months ended September 30, 2005:Net premiums written
    
    $
    453,352
    
    
    
    621,218
    
    
    
    252,374
    
    
    $
    1,326,944Net premiums earned
    
    
    414,719
    
    
    
    588,541
    
    
    
    268,638
    
    
    
    1,271,898Losses and LAE
    
    
    492,300
    
    
    
    375,187
    
    
    
    175,681
    
    
    
    1,043,168Acquisition expenses
    
    
    69,437
    
    
    
    143,262
    
    
    
    83,336
    
    
    
    296,035Other underwriting expenses
    
    
    19,595
    
    
    
    18,179
    
    
    
    3,428
    
    
    
    41,202Segment underwriting income (loss)
    
    $
    (166,613
    )
    
    
    51,913
    
    
    
    6,193
    
    
    
    (108,507
    )Net investment income and net realized losses on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    91,188Net foreign currency exchange losses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,870
    )Other expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (201
    )Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,366
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,186
    )Loss before income tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (42,942
    )Ratios:Losses and LAE
    
    
    118.7
    %
    
    
    63.7
    %
    
    
    65.4
    %
    
    
    82.0
    %Acquisition expense
    
    
    16.7
    %
    
    
    24.3
    %
    
    
    31.0
    %
    
    
    23.3
    %Other underwriting expense
    
    
    4.7
    %
    
    
    3.1
    %
    
    
    1.3
    %
    
    
    3.2
    %Combined
    
    
    140.1
    %
    
    
    91.1
    %
    
    
    97.7
    %
    
    
    108.5
    %Nine months ended September 30, 2004:Net premiums written
    
    $
    393,764
    
    
    
    508,693
    
    
    
    348,671
    
    
    $
    1,251,128Net premiums earned
    
    
    353,423
    
    
    
    424,964
    
    
    
    236,612
    
    
    
    1,014,999Losses and LAE
    
    
    285,047
    
    
    
    293,734
    
    
    
    157,378
    
    
    
    736,159Acquisition expenses
    
    
    57,491
    
    
    
    105,765
    
    
    
    69,630
    
    
    
    232,886Other underwriting expenses
    
    
    21,280
    
    
    
    15,979
    
    
    
    5,825
    
    
    
    43,084Segment underwriting income (loss)
    
    $
    (10,395
    )
    
    
    9,486
    
    
    
    3,779
    
    
    
    2,870Net investment income and net realized gains on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59,725Net foreign currency exchange gains
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    326Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,137Corporate expenses not allocated to segments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,352
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,952
    )Income before income tax expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    47,754Ratios:Losses and LAE
    
    
    80.7
    %
    
    
    69.1
    %
    
    
    66.5
    %
    
    
    72.5
    %Acquisition expense
    
    
    16.3
    %
    
    
    24.9
    %
    
    
    29.4
    %
    
    
    22.9
    %Other underwriting expense
    
    
    6.0
    %
    
    
    3.8
    %
    
    
    2.5
    %
    
    
    4.2
    %Combined
    
    
    103.0
    %
    
    
    97.8
    %
    
    
    98.4
    %
    
    
    99.6
    %
 Property and Marine
  - 33 -




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Three Months Ended September 30, 2005 as Compared with the Three Months Ended September 30,
2004
  2005
    
    
    2004
    
    
    IncreaseNet premiums written
    
    $
    133,350
    
    
    
    120,629
    
    
    $
    12,721Net premiums earned
    
    $
    145,853
    
    
    
    135,430
    
    
    $
    10,423
   2005
    
    
    2004
    
    
    IncreaseLosses and LAE
    
    $
    373,761
    
    
    
    195,495
    
    
    $
    178,266Loss and LAE ratios
    
    
    256.3
    %
    
    
    144.4
    %
    
    111.9 points
   2005
    
    
    2004
    
    
    DecreaseAcquisition expenses
    
    $
    17,753
    
    
    
    20,834
    
    
    $
    (3,081
    )Acquisition expense ratios
    
    
    12.2
    %
    
    
    15.4
    %
    
    (3.2) points
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##### Table of Contents



Nine Months Ended September 30, 2005 as Compared with the Nine Months Ended September 30,
2004
  2005
    
    
    2004
    
    
    IncreaseNet premiums written
    
    $
    453,352
    
    
    
    393,764
    
    
    $
    59,588Net premiums earned
    
    $
    414,719
    
    
    
    353,423
    
    
    $
    61,296
   2005
    
    
    2004
    
    
    IncreaseLosses and LAE
    
    $
    492,300
    
    
    
    285,047
    
    
    $
    207,253Loss and LAE ratios
    
    
    118.7
    %
    
    
    80.7
    %
    
    38.0 points
   2005
    
    
    2004
    
    
    IncreaseAcquisition expenses
    
    $
    69,437
    
    
    
    57,491
    
    
    $
    11,946Acquisition expense ratios
    
    
    16.7
    %
    
    
    16.3
    %
    
    0.4 points
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Casualty
  Three Months Ended September 30, 2005 as Compared with the Three Months Ended September 30,
2004
  2005
    
    
    2004
    
    
    IncreaseNet premiums written
    
    $
    216,659
    
    
    
    171,967
    
    
    $
    44,692Net premiums earned
    
    $
    205,050
    
    
    
    156,512
    
    
    $
    48,538
   Increase2005
    
    
    2004
    
    
    (decrease)Losses and LAE
    
    $
    129,218
    
    
    
    105,559
    
    
    $
    23,659Loss and LAE ratios
    
    
    63.0
    %
    
    
    67.4
    %
    
    (4.4) points
   Increase2005
    
    
    2004
    
    
    (decrease)Acquisition expenses
    
    $
    50,097
    
    
    
    38,935
    
    
    $
    11,162Acquisition expense ratios
    
    
    24.4
    %
    
    
    24.9
    %
    
    (0.5) points
  - 36 -




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Nine Months Ended September 30, 2005 as Compared with the Nine Months Ended September 30,
2004
  2005
    
    
    2004
    
    
    IncreaseNet premiums written
    
    $
    621,218
    
    
    
    508,693
    
    
    $
    112,525Net premiums earned
    
    $
    588,541
    
    
    
    424,964
    
    
    $
    163,577
   Increase2005
    
    
    2004
    
    
    (decrease)Losses and LAE
    
    $
    375,187
    
    
    
    293,734
    
    
    $
    81,453Loss and LAE ratios
    
    
    63.7
    %
    
    
    69.1
    %
    
    (5.4) points
   Increase2005
    
    
    2004
    
    
    (decrease)Acquisition expenses
    
    $
    143,262
    
    
    
    105,765
    
    
    $
    37,497Acquisition expense ratios
    
    
    24.3
    %
    
    
    24.9
    %
    
    (0.6) points
   - 37 -




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Finite Risk
  Three Months Ended September 30, 2005 as Compared with the Three Months Ended September 30,
2004
  2005
    
    
    2004
    
    
    DecreaseNet premiums written
    
    $
    60,177
    
    
    
    147,899
    
    
    $
    (87,722
    )Net premiums earned
    
    $
    78,485
    
    
    
    91,148
    
    
    $
    (12,663
    )
   - 38 -




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Increase2005
    
    
    2004
    
    
    (decrease)Losses and LAE
    
    $
    61,639
    
    
    
    83,670
    
    
    $
    (22,031
    )Loss and LAE ratios
    
    
    78.5
    %
    
    
    91.8
    %
    
    (13.3) pointsAcquisition expenses
    
    $
    31,008
    
    
    
    21,502
    
    
    $
    9,506Acquisition expense ratios
    
    
    39.5
    %
    
    
    23.6
    %
    
    15.9 pointsLosses, LAE and acquisition expenses
    
    $
    92,647
    
    
    
    105,172
    
    
    $
    (12,525
    )Loss, LAE and acquisition expense
ratios
    
    
    118.0
    %
    
    
    115.4
    %
    
    2.6 points
   Nine Months Ended September 30, 2005 as Compared with the Nine Months Ended September 30,
2004
  Increase2005
    
    
    2004
    
    
    (decrease)Net premiums written
    
    $
    252,374
    
    
    
    348,671
    
    
    $
    (96,297
    )Net premiums earned
    
    $
    268,638
    
    
    
    236,612
    
    
    $
    32,026
   - 39 -




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##### Table of Contents



Increase2005
    
    
    2004
    
    
    (decrease)Losses and LAE
    
    $
    175,681
    
    
    
    157,378
    
    
    $
    18,303Loss and LAE ratios
    
    
    65.4
    %
    
    
    66.5
    %
    
    (1.1) pointsAcquisition expenses
    
    $
    83,336
    
    
    
    69,630
    
    
    $
    13,706Acquisition expense ratios
    
    
    31.0
    %
    
    
    29.4
    %
    
    1.6 pointsLosses, LAE and acquisition expenses
    
    $
    259,017
    
    
    
    227,008
    
    
    $
    32,009Loss, LAE and acquisition expense
ratios
    
    
    96.4
    %
    
    
    95.9
    %
    
    0.5 points
   Financial Condition, Liquidity and Capital Resources
 Financial Condition
  
 - 40 -




---



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Sources of Liquidity
       - 41 -




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Liquidity Requirements
   - 42 -




---



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- 43 -




---



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Economic Conditions
  Current Outlook
     - 44 -




---



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Critical Accounting Policies, Estimates and Judgments
  Premiums
   - 45 -




---



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Unpaid Losses and LAE
     - 46 -




---



##### Table of Contents



Propertyand Marine
    
    
    Casualty
    
    
    Finite Risk
    
    
    TotalCase reserves
    
    $
    130,159
    
    
    
    139,835
    
    
    
    29,557
    
    
    $
    299,551IBNR
    
    
    620,617
    
    
    
    868,619
    
    
    
    290,881
    
    
    
    1,780,117Total unpaid losses and LAE
    
    $
    750,776
    
    
    
    1,008,454
    
    
    
    320,438
    
    
    $
    2,079,668
    - 47 -




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- 48 -




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Reinsurance
  Investments
  - 49 -




---



##### Table of Contents



Income Tax Expense
   Share-Based Compensation
   - 50 -




---



##### Table of Contents



Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Market and Credit Risk
    - 51 -




---



##### Table of Contents



Interest Rate Risk
  Interest Rate Shift in Basis Points- 100 bp
    
    
    - 50 bp
    
    
    Current
    
    
    + 50 bp
    
    
    + 100 bpTotal market value
    
    $
    3,091,148
    
    
    
    3,037,684
    
    
    
    2,983,217
    
    
    
    2,928,139
    
    
    $
    2,872,933Percent change in market value
    
    
    3.6
    %
    
    
    1.8
    %
    
    
    
    
    
    
    (1.8
    %)
    
    
    (3.7
    %)Resulting unrealized
appreciation / (depreciation)
    
    $
    76,803
    
    
    
    23,339
    
    
    
    (31,128
    )
    
    
    (86,206
    )
    
    $
    (141,412
    )
 Foreign Currency Risk
  Sources of Fair Value
  CarryingAmount
    
    
    Fair ValueFinancial assets:Fixed maturities
    
    $
    2,983,217
    
    
    $
    2,983,217Other invested asset
    
    
    6,000
    
    
    
    6,000Financial liabilities:Debt obligations
    
    $
    387,500
    
    
    $
    399,125
  - 52 -




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##### Table of Contents



Item 4. CONTROLS AND PROCEDURES
 Disclosure Controls and Procedures
  Changes in Internal Control over Financial Reporting
  FORWARD-LOOKING STATEMENTS
    (1)
    
    conducting operations in a competitive environment;(2)
    
    our ability to maintain our rating from A.M. Best;(3)
    
    significant weather-related or other natural or man-made disasters over which the
Company has no control, including, without limitation, Hurricanes Katrina and Rita, and
the possibility that estimates of losses and LAE from Hurricanes Katrina and Rita will
prove to be materially different;(4)
    
    the effectiveness of our loss limitation methods and pricing models;(5)
    
    the adequacy of the Companys liability for unpaid losses and loss adjustment
expenses;(6)
    
    the availability of retrocessional reinsurance on acceptable terms;
 - 53 -




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##### Table of Contents



(7)
    
    our ability to maintain our business relationships with reinsurance brokers;(8)
    
    general political and economic conditions, including the effects of civil unrest, war
or a prolonged U.S. or global economic downturn or recession;(9)
    
    the cyclicality of the property and casualty reinsurance business;(10)
    
    market volatility and interest rate and currency exchange rate fluctuation;(11)
    
    tax, regulatory or legal restrictions or limitations applicable to the Company or the
property and casualty reinsurance business generally; and(12)
    
    changes in the Companys plans, strategies, objectives, expectations or intentions,
which may happen at any time at the Companys discretion.
  
 PART II  OTHER INFORMATION
 
 Item 1. LEGAL PROCEEDINGS
    
 Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  - 54 -




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##### Table of Contents



Item 6. EXHIBITS
 (a)
    
    Exhibits
 ExhibitNumber
    
    Description31.1
    
    Certification of Michael D. Price, Chief Executive
Officer of Platinum Holdings, pursuant to Rule 13a-14(a) or
Rule 15d-14(a) of the Exchange Act.31.2
    
    Certification of Joseph F. Fisher, Chief Financial Officer
of Platinum Holdings, pursuant to Rule 13a-14(a) or Rule
15d-14(a) of the Exchange Act.32.1
    
    Certification of Michael D. Price, Chief Executive
Officer of Platinum Holdings, pursuant to 18 U.S.C. section
1350, as adopted pursuant to section 906 of the
Sarbanes-Oxley Act of 2002.32.2
    
    Certification of Joseph F. Fisher, Chief Financial Officer
of Platinum Holdings, pursuant to 18 U.S.C. section 1350,
as adopted pursuant to section 906 of the Sarbanes-Oxley
Act of 2002.
 (b)
    
    Reports on Form 8-KOn October 24 2005, Platinum Holdings filed with the SEC a report on Form 8-K
containing a press release, issued on October 21, 2005, reporting that (1) the
Company entered into a three-year $200,000,000 credit agreement dated as of October
21, 2005 consisting of a $100,000,000 unsecured senior credit facility available for
revolving borrowings and letters of credit and a $100,000,000 secured senior credit
facility available for letters of credit, and (2) Platinum Holdings and Platinum
Finance filed an additional unallocated universal shelf registration statement with
the SEC.On October 28, 2005, Platinum Holdings filed with the SEC a report on Form 8-K
containing a press release, issued on October 27, 2005, reporting the appointment of
Michael D. Price as President and Chief Executive Officer, succeeding Gregory E.A.
Morrison, who has been named Vice Chairman of the Board of Directors.
 
 SIGNATURES
  Platinum Underwriters Holdings, LtdDate:
October 31, 2005
    
    /s/ Michael D. PriceBy: Michael D. PricePresident and Chief Executive Officer(Principal Executive Officer)Date:
October 31, 2005
    
    /s/Joseph F. FisherBy: Joseph F. FisherExecutive Vice President and Chief Financial Officer(Principal Financial and Accounting
Officer)
 -55-