UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 WASHINGTON,
DC 20549
 FORM
10-Q
  x
              QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the quarterly period ended March 31,
      2008ORo
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the transition period from __________ to
  __________
 
 Commission
File Number 001-31341
 
 Platinum
      Underwriters Holdings, Ltd.(Exact
      name of registrant as specified in its
charter)
 
 Bermuda
              
              98-0416483(State
      or other jurisdiction of incorporation or organization)
              
              (I.R.S.
      Employer Identification No.)
 
 The
      Belvedere Building
                69
      Pitts Bay Road
                Pembroke,
      Bermuda
              
              HM
      08(Address
      of principal executive offices)
              
              (Zip
      Code)
 
 (441)
295-7195
 (Registrant's
telephone number, including area code)
 
 Not
Applicable
 (Former
name, former address and former fiscal year, if changed since last
report)
 
 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.      YesX
No ___
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting
company.  See definitions of "accelerated filer”, “large accelerated
filer" and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):
  Large
      accelerated filer
              X
              
              Accelerated
      filer
 
 Non-accelerated
      filer
              
              (Do not check if a smaller reporting company)
              Smaller
      Reporting Company
 
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange
Act).         Yes  No
X_
 
 As of
April 15, 2008, there were outstanding 48,923,952 common shares, par value $0.01
per share, of the registrant.
  
   PLATINUM
UNDERWRITERS HOLDINGS, LTD.
 QUARTERLY
REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2008
 
 TABLE OF
CONTENTS
 PagePART
      I  –  FINANCIAL INFORMATIONItem
      1.Condensed Consolidated Financial StatementsConsolidated
      Balance Sheets as of March 31, 2008 (Unaudited) andDecember 31,
      2007
              1Consolidated
      Statements of Operations and Comprehensive Income for the Three Months
      Ended March 31, 2008 and 2007 (Unaudited)
              2Consolidated
      Statements of Changes in Shareholders’ Equity for the Three Months Ended
      March 31, 2008 and 2007 (Unaudited)
              3Consolidated
      Statements of Cash Flows for the Three Months EndedMarch 31,
      2008 and 2007 (Unaudited)
              4Notes
      to Condensed Consolidated Financial Statements for the Three Months Ended
      March 31, 2008 and 2007 (Unaudited)
              5Item
      2.Management's Discussion and Analysis of Financial Condition and Results
      of Operations
              12Item
      3.Quantitative and Qualitative Disclosures about Market
    Risk
              20Item
      4.Controls and Procedures
              21PART
      II  –  OTHER INFORMATIONItem
      2.Unregistered Sales of Equity Securities and Use of
    Proceeds
              22Item
      6.Exhibits
              22SIGNATURES
              23
   
 
 
 PART
I - FINANCIAL INFORMATION
  ITEM
      1. CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
  Platinum
Underwriters Holdings, Ltd. and Subsidiaries
 Consolidated Balance Sheets
 ($ in
thousands, except share data)
 
 (Unaudited)March 31,
      2008
              
              
              December 31,
      2007ASSETSInvestments:Fixed
      maturity available-for-sale securities at fair value
                (amortized
      cost – $3,061,191 and $3,214,981, respectively)
              $
              3,036,179
              
              
              $
              3,191,923Fixed
      maturity trading securities at fair value
                (amortized
      cost – $167,264 and $170,952,
      respectively)
              
              169,021
              
              
              
              169,818Preferred
      stocks (cost – $12,246 and $12,246, respectively)
              
              10,066
              
              
              
              9,607Short-term
      investments
              
              135,418
              
              
              
              13,876Total
      investments
              
              3,350,684
              
              
              
              3,385,224Cash
      and cash equivalents
              
              1,034,344
              
              
              
              1,076,279Accrued
      investment income
              
              29,097
              
              
              
              34,696Reinsurance
      premiums receivable
              
              304,240
              
              
              
              244,360Reinsurance
      recoverable on ceded losses and loss adjustment expenses
              
              22,074
              
              
              
              27,979Prepaid
      reinsurance premiums
              
              8,446
              
              
              
              9,369Funds
      held by ceding companies
              
              165,023
              
              
              
              165,604Deferred
      acquisition costs
              
              68,084
              
              
              
              70,508Deferred
      tax assets
              
              43,346
              
              
              
              43,342Other
      assets
              
              18,318
              
              
              
              21,389Total
      assets
              $
              5,043,656
              
              
              $
              5,078,750LIABILITIES
      AND SHAREHOLDERS’ EQUITYLiabilitiesUnpaid
      losses and loss adjustment expenses
              $
              2,410,227
              
              
              $
              2,361,038Unearned
      premiums
              
              293,148
              
              
              
              298,498Debt
      obligations
              
              250,000
              
              
              
              250,000Ceded
      premiums payable
              
              130
              
              
              
              4,559Commissions
      payable
              
              111,908
              
              
              
              100,204Other
      liabilities
              
              49,135
              
              
              
              66,074Total
      liabilities
              
              3,114,548
              
              
              
              3,080,373Shareholders’
      EquityPreferred
      shares, $.01 par value, 25,000,000 shares authorized, 5,750,000 shares
      issued and outstanding
              
              57
              
              
              
              57Common
      shares, $.01 par value, 200,000,000 shares authorized, 48,923,952 and
      53,779,914 shares issued and outstanding, respectively
              
              489
              
              
              
              538Additional
      paid-in capital
              
              1,174,952
              
              
              
              1,338,466Accumulated
      other comprehensive loss
              
              (28,460
              )
              
              
              (24,339
              )Retained
      earnings
              
              782,070
              
              
              
              683,655Total
      shareholders' equity
              
              1,929,108
              
              
              
              1,998,377Total
      liabilities and shareholders' equity
              $
              5,043,656
              
              
              $
              5,078,750
 
 
 See
accompanying Notes to the Condensed Consolidated Financial
Statements.
  - 1
-
   Platinum
Underwriters Holdings, Ltd. and Subsidiaries
 Consolidated
Statements of Operations and Comprehensive Income (Unaudited)
 For the
Three Months Ended March 31, 2008 and 2007
 ($ in
thousands, except per share data)
 
 2008
              
              
              2007Revenue:Net
      premiums earned
              $
              301,851
              
              
              $
              284,848Net
      investment income
              
              49,062
              
              
              
              51,699Net
      realized gains (losses) on investments
              
              45
              
              
              
              (18
              )Other
      income (expense)
              
              2,021
              
              
              
              (780
              )Total
      revenue
              
              352,979
              
              
              
              335,749Expenses:Net
      losses and loss adjustment expenses
              
              160,203
              
              
              
              181,913Net
      acquisition expenses
              
              60,542
              
              
              
              48,120Operating
      expenses
              
              21,690
              
              
              
              23,206Net
      foreign currency exchange gains
              
              (4,869
              )
              
              
              (42
              )Interest
      expense
              
              4,750
              
              
              
              5,455Total
      expenses
              
              242,316
              
              
              
              258,652Income
      before income tax expense
              
              110,663
              
              
              
              77,097Income
      tax expense
              
              5,492
              
              
              
              4,264Net
      income
              
              105,171
              
              
              
              72,833Preferred
      dividends
              
              2,602
              
              
              
              2,602Net
      income attributable to common shareholders
              $
              102,569
              
              
              $
              70,231Earnings
      per share:Basic
      earnings per share
              $
              1.97
              
              
              $
              1.18Diluted
      earnings per share
              $
              1.76
              
              
              $
              1.08Comprehensive
      income:Net
      income
              $
              105,171
              
              
              $
              72,833Other
      comprehensive income (loss):Net
      change in unrealized gains and losses on available-for-sale securities,
      net of deferred taxes
              
              (4,121
              )
              
              
              9,429Cumulative
      translation adjustments, net of deferred taxes
              
              –
              
              
              
              (44
              )Comprehensive
      income
              $
              101,050
              
              
              $
              82,218Shareholder
      dividends:Preferred
      dividends declared
              $
              2,602
              
              
              $
              2,602Preferred
      dividends declared per share
              
              0.45
              
              
              
              0.45Common
      dividends declared
              
              4,154
              
              
              
              4,784Common
      dividends declared per share
              $
              0.08
              
              
              $
              0.08
 
 
 See
accompanying Notes to the Condensed Consolidated Financial
Statements.
  - 2
-
    Platinum
Underwriters Holdings, Ltd. and Subsidiaries
 Consolidated
Statements of Changes in Shareholders’ Equity (Unaudited)
 For the
Three Months Ended March 31, 2008 and 2007
 ($ in
thousands)
 
 2008
              
              
              2007Preferred
      shares:Balances
      at beginning and end of periods
              $
              57
              
              
              $
              57Common
      shares:Balances
      at beginning of period
              
              538
              
              
              
              597Exercise
      of common share options
              
              –
              
              
              
              1Issuance
      of common shares
              
              1
              
              
              
              –Purchase
      of common shares
              
              (50
              )
              
              
              –Balances
      at end of period
              
              489
              
              
              
              598Additional
      paid-in-capital:Balances
      at beginning of period
              
              1,338,466
              
              
              
              1,545,979Exercise
      of common share options
              
              –
              
              
              
              2,991Issuance
      of common shares
              
              1,647
              
              
              
              –Share
      based compensation
              
              3,027
              
              
              
              1,398Settlement
      of equity awards
              
              (296
              )
              
              
              –Purchase
      of common shares
              
              (167,892
              )
              
              
              –Balances
      at end of period
              
              1,174,952
              
              
              
              1,550,368Accumulated other
      comprehensive loss:Balances
      at beginning of period
              
              (24,339
              )
              
              
              (44,289
              )Net
      change in unrealized gains and losses on available-for-sale securities,
      net of deferred tax
              
              (4,121
              )
              
              
              9,429Net
      change in cumulative translation adjustments, net of deferred
      tax
              
              –
              
              
              
              (44
              )Balances
      at end of period
              
              (28,460
              )
              
              
              (34,904
              )Retained
      earnings:Balances
      at beginning of period
              
              683,655
              
              
              
              355,717Net
      income
              
              105,171
              
              
              
              72,833Preferred
      share dividends
              
              (2,602
              )
              
              
              (2,602
              )Common
      share dividends
              
              (4,154
              )
              
              
              (4,784
              )Balances
      at end of period
              
              782,070
              
              
              
              421,164Total
      shareholders’ equity
              $
              1,929,108
              
              
              $
              1,937,283
 
 
 
 
 
 
 
 See
accompanying Notes to the Condensed Consolidated Financial
Statements.
  - 3
-
   Platinum
Underwriters Holdings, Ltd. and Subsidiaries
 Consolidated
Statements of Cash Flows (Unaudited)
 For the
Three Months Ended March 31, 2008 and 2007
 ($ in
thousands)
 2008
              
              
              2007Operating
      Activities:Net
      income
              $
              105,171
              
              
              $
              72,833Adjustments
      to reconcile net income to cash provided by operations:Depreciation
      and amortization
              
              2,136
              
              
              
              3,586Net
      realized (gains) losses on investments
              
              (45
              )
              
              
              18Net
      foreign currency exchange gains
              
              (4,869
              )
              
              
              (42
              )Share
      based compensation
              
              3,053
              
              
              
              1,398Deferred
      income tax expense
              
              (2,625
              )
              
              
              (3,411
              )Trading
      securities activities
              
              7,554
              
              
              
              2,230Changes
      in assets and liabilities:Decrease
      in accrued investment income
              
              5,599
              
              
              
              85(Increase)
      decrease in reinsurance premiums receivable
              
              (55,773
              )
              
              
              13,221Decrease
      in funds held by ceding companies
              
              581
              
              
              
              3,180(Increase)
      decrease in deferred acquisition costs
              
              2,424
              
              
              
              (1,928
              )Increase
      in net unpaid losses and loss adjustment expenses
              
              46,339
              
              
              
              49,136Increase
      (decrease) in net unearned premiums
              
              (4,427
              )
              
              
              14,310Decrease
      in ceded premiums payable
              
              (4,429
              )
              
              
              (11,542
              )Increase
      (decrease) in commissions payable
              
              11,704
              
              
              
              (6,086
              )Net
      changes in other assets and liabilities
              
              (10,071
              )
              
              
              (17,826
              )Other
      net
              
              2,512
              
              
              
              384Net
      cash provided by operating activities
              
              104,834
              
              
              
              119,546Investing
      Activities:Proceeds
      from sale of available-for-sale fixed maturity securities
              
              6,177
              
              
              
              –Proceeds
      from maturity or paydown of available-for-sale fixed maturity
      securities
              
              442,368
              
              
              
              271,035Acquisition
      of available-for-sale fixed maturity securities
              
              (299,553
              )
              
              
              (457,939
              )Proceeds
      from sale of other invested asset
              
              –
              
              
              
              4,745Net
      change in short-term investments
              
              (121,064
              )
              
              
              19,006Net
      cash provided by (used in) investing activities
              
              27,928
              
              
              
              (163,153
              )Financing
      Activities:Dividends
      paid to preferred shareholders
              
              (2,602
              )
              
              
              (2,602
              )Dividends
      paid to common shareholders
              
              (4,154
              )
              
              
              (4,784
              )Proceeds
      from exercise of share options
              
              –
              
              
              
              2,993Purchase
      of common shares
              
              (167,941
              )
              
              
              –Net
      cash used in financing activities
              
              (174,697
              )
              
              
              (4,393
              )Net
      decrease in cash and cash equivalents
              
              (41,935
              )
              
              
              (48,000
              )Cash
      and cash equivalents at beginning of period
              
              1,076,279
              
              
              
              851,652-Cash
      and cash equivalents at end of period
              $
              1,034,344
              
              
              $
              803,652Supplemental
      disclosures of cash flow information:Income
      taxes paid
              $
              2,125
              
              
              $
              20Interest
      paid
              $
              –
              
              
              $
              –
 
 
 See
accompanying Notes to the Condensed Consolidated Financial
Statements.
  - 4
-
    Platinum
Underwriters Holdings, Ltd. and Subsidiaries
 Notes to the Condensed Consolidated Financial Statements
(Unaudited)
 For the
Three Months Ended March 31, 2008 and 2007
   1.
      Basis of
      Presentation
  Platinum
Underwriters Holdings, Ltd. ("Platinum Holdings") is a Bermuda holding company
organized in 2002.  Platinum Holdings and its subsidiaries (the
"Company") operate through two licensed reinsurance
subsidiaries:  Platinum Underwriters Bermuda, Ltd. ("Platinum
Bermuda") and Platinum Underwriters Reinsurance, Inc. ("Platinum
US").  The terms "we", "us", and "our" also refer to Platinum Holdings
and its consolidated subsidiaries, unless the context otherwise
indicates.  Through December 31, 2006 we also underwrote business
through Platinum Re (UK) Limited ("Platinum UK"), our other licensed reinsurance
subsidiary.  In 2007, Platinum UK ceased underwriting reinsurance
business.  We provide property and marine, casualty and finite risk
reinsurance coverages, through reinsurance intermediaries, to a diverse
clientele of insurers and select reinsurers on a worldwide basis.
  The
condensed consolidated financial statements have been prepared in conformity
with accounting principles generally accepted in the United States ("U.S. GAAP")
and include the accounts of Platinum Holdings and its consolidated subsidiaries,
including Platinum Bermuda, Platinum US, Platinum UK, Platinum Underwriters
Finance, Inc. ("Platinum Finance"), Platinum Regency Holdings ("Platinum
Regency"), Platinum Administrative Services, Inc. and Platinum UK Services
Company Limited.  All material inter-company transactions have been
eliminated in preparing these condensed consolidated financial
statements.  The condensed consolidated financial statements included
in this report as of and for the three months ended March 31, 2008 and 2007
are unaudited and include adjustments consisting of normal recurring items that
management considers necessary for a fair presentation under U.S.
GAAP.  These condensed consolidated financial statements should be
read in conjunction with the consolidated financial statements and related notes
included in our Annual Report on Form 10-K for the year ended December 31,
2007.
  The
preparation of financial statements requires us to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period.  Actual results could materially differ from these
estimates.  The results of operations for any interim period are not
necessarily indicative of results for the full year.
   Recently
Effective Accounting Standards
  In
February 2007, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standards No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities" ("SFAS 159").  SFAS 159
permits an entity to irrevocably elect fair value on a contract-by-contract
basis as the initial and subsequent measurement attribute for many financial
assets and liabilities and certain other items.  Most provisions of
SFAS 159 are elective.  Entities electing the fair value measurement
attributes of SFAS 159 are required to recognize changes in fair values in
earnings and to expense upfront costs and fees associated with the items for
which the fair values option is elected.  SFAS 159 is effective for
fiscal years beginning after November 15, 2007.  We have not
applied the fair value measurement attributes of SFAS 159 to any financial
assets or liabilities, and therefore our adoption of SFAS 159 as of January 1,
2008 did not have an effect on our financial condition or results of
operations.
  In March
2008, the FASB issued Statement of Financial Accounting Standards No. 161,
"Disclosure about Derivative Instruments and Hedging Activities – an amendment
of FASB Statement No. 133" ("SFAS 161").  SFAS 161 amends and expands
the disclosure requirements in SFAS No. 133, “Accounting for Derivative
Instruments and Hedging Activities” about an entity’s derivative and hedging
activities and how these activities affect an entity’s financial position,
financial performance and cash flows, thereby improving the transparency of
financial reporting.  SFAS 161 is effective for financial statements
issued for fiscal years and interim periods beginning after November 15, 2008,
with early application encouraged.  We are currently evaluating the
impact that SFAS 161 may have, if any, on our consolidated financial
statements.
   2.
      Investments
  Investments
classified as available-for-sale are carried at fair value as of the balance
sheet date.  Net changes in unrealized investment gains and losses on
available-for-sale securities, net of deferred taxes, for the three months ended
March 31, 2008 and 2007 were as follows ($ in thousands):
  2008
              
              
              2007Net
      change in fair value
              $
              (1,501
              )
              
              $
              10,808Deferred
      taxes
              
              (2,620
              )
              
              
              (1,379
              )Net
      change in unrealized investment gains and losses
              $
              (4,121
              )
              
              $
              9,429
 
  Gross
unrealized gains and losses on available-for-sale securities as of
March 31, 2008 were $34,987,000 and $62,179,000,
respectively.  As of March 31, 2008 there were a total of 267
issues in an unrealized loss position in our investment portfolio, with the
single largest unrealized loss being an asset-backed security with an unrealized
loss of $4,210,000.  Corporate, mortgage-backed and asset-backed
securities represent the largest categories within our available-for-sale
portfolio and consequently accounted for the greatest amount of our overall
unrealized loss as of March 31, 2008.  Investment holdings within
our corporate portfolio were diversified across approximately 30 industry
sectors, ranging from aerospace to telecommunications, and within each sector
across many individual issuers and issues.  As of March 31, 2008
there were 104 corporate issues in an unrealized loss position, with the single
largest unrealized loss being $996,000.  Investment holdings within
the mortgage-backed and asset-backed portfolio were diversified across a number
of sub-categories.  As of March 31, 2008 there were 142 issues
within the mortgage-backed and asset-backed portfolio in an unrealized loss
position.
   - 5
-
  The
unrealized losses on securities classified as available-for-sale, aggregated by
investment category and length of time that individual securities have been in a
continuous unrealized loss position as of March 31, 2008, were as follows
($ in thousands):
  Fair
      Value
              
              
              Unrealized
                LossLess than twelve
      months:U.S.
      Government
              $
              –
              
              
              $
              –Corporate
      bonds
              
              207,474
              
              
              
              5,861Mortgage-backed
      and asset-backed securities
              
              424,815
              
              
              
              20,661Municipal
      bonds
              
              44,785
              
              
              
              587Foreign
      governments and states
              
              3,013
              
              
              
              2Preferred
      stocks
              
              970
              
              
              
              30Total
              $
              681,057
              
              
              $
              27,141Twelve months or
      more:U.S.
      Government
              $
              2,659
              
              
              $
              9Corporate
      bonds
              
              164,689
              
              
              
              12,589Mortgage-backed
      and asset-backed securities
              
              271,698
              
              
              
              19,903Municipal
      bonds
              
              8,179
              
              
              
              387Foreign
      governments and states
              
              –
              
              
              
              –Preferred
      stocks
              
              9,096
              
              
              
              2,150Total
              $
              456,321
              
              
              $
              35,038Total unrealized
      losses:U.S.
      Government
              $
              2,659
              
              
              $
              9Corporate
      bonds
              
              372,163
              
              
              
              18,450Mortgage-backed
      and asset-backed securities
              
              696,513
              
              
              
              40,564Municipal
      bonds
              
              52,964
              
              
              
              974Foreign
      governments and states
              
              3,013
              
              
              
              2Preferred
      stocks
              
              10,066
              
              
              
              2,180Total
              $
              1,137,378
              
              
              $
              62,179
 
 We
routinely review our available-for-sale investments to determine whether
unrealized losses represent temporary changes in fair value or were the result
of "other-than-temporary impairments."  The process of determining
whether a security is other than temporarily impaired is subjective and involves
analyzing many factors.  These factors include, but are not limited
to:  the overall financial condition of the issuer, the length and
magnitude of an unrealized loss, specific credit events, the collateral
structure and the credit support that may be applicable to mortgage-backed and
asset-backed securities.  We also consider our ability and intent to
hold a security for a sufficient period of time for the value to recover the
unrealized loss, which is based, in part, on current and anticipated future
positive net cash flows from operations that generate sufficient liquidity in
order to meet our obligations.  If we determine that an unrealized
loss on a security is other than temporary, we write down the carrying value of
the security and record a realized loss in the consolidated statement of
operations.
   Fair
Value Measurements
  We
adopted SFAS No. 157, “Fair Value Measurements” ("SFAS 157") as of January
1, 2008.  SFAS 157 defines fair value as the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.  This
statement establishes a framework for measuring fair value and expands
disclosures regarding fair value measurements in accordance with U.S.
GAAP.  The fair value hierarchy gives the highest priority to quoted
prices in active markets for identical assets or liabilities (Level 1) and the
lowest priority to fair values derived from unobservable inputs (Level
3).  The level in the fair value hierarchy within which the fair value
measurement in its entirety falls shall be determined based on the lowest level
input that is significant to the fair value measurement in its
entirety.
  We
utilize established independent pricing services in valuing our portfolio of
fixed maturities and preferred stocks.  We consider prices for
actively traded treasury securities and exchange traded preferred stocks to be
based on quoted prices in active markets for identical assets (Level 1 as
defined by SFAS 157).  The values of our other fixed maturities, which
generally include mortgage-backed and asset-backed securities, corporate bonds,
municipal bonds, U.S. government-sponsored enterprises, foreign governments and
states, are priced by independent pricing vendors, index providers, or
broker-dealers who derive fair values for those assets from observable inputs
(Level 2 as defined by SFAS 157).  The observable inputs used in
standard market valuation pricing models may include but are not limited to:
credit ratings, interest rates and yield curves at commonly quoted intervals,
volatilities, prepayment speeds, loss severities, credit risks and default
rates.  Our derivative instruments, which are included in other assets
in the consolidated balance sheet, are priced at fair value using unobservable
inputs through the application of our own assumptions and internal valuation
pricing models (Level 3 as defined by SFAS 157).
  - 6
-
  The
following table presents the fair value measurement levels for all assets and
liabilities which the Company has recorded at fair value as of March 31,
2008 ($ in thousands):
  Fair
      Value Measurementat
      Reporting Date Using:Total
              
              
              Level
      1
              
              
              Level
      2
              
              
              Level
      3Assets:Fixed
      maturity available-for-sale securities
              $
              3,036,179
              
              
              
              112,197
              
              
              
              2,923,982
              
              
              $
              –Fixed
      maturity trading securities
              
              169,021
              
              
              
              54,658
              
              
              
              114,363
              
              
              
              –Preferred
      stocks
              
              10,066
              
              
              
              7,125
              
              
              
              2,941
              
              
              
              –Short-term
      investments
              
              135,418
              
              
              
              34,931
              
              
              
              100,487
              
              
              
              –Derivative
      instruments
              
              5,950
              
              
              
              –
              
              
              
              –
              
              
              
              5,950Total
              $
              3,356,634
              
              
              
              208,911
              
              
              
              3,141,773
              
              
              $
              5,950
 
 The
following table presents the reconciliation of the beginning and ending fair
value measurements of our Level 3 assets, consisting of derivative instruments,
measured at fair value using significant unobservable inputs ($ in
thousands):
  Beginning
      balance at January 1, 2008
              $
              –Purchases,
      issuances, and settlements
              
              6,760Total
      realized losses included in earnings
              
              (810
              )Ending
      balance at March 31, 2008
              
              5,950Losses
      for the period attributable to the change in realized losses relating to
      assets still held
              $
              (810
              )
 
 Realized
losses of $810,000 have been included in earnings for the period ended March 31,
2008 and are reported in other income (expense) in the consolidated statement of
operations.
   3.
      Earnings Per
      Share
  The
following is a calculation of the basic and diluted earnings per common share
for the three months ended March 31, 2008 and 2007 (in thousands, except
per share data):
  Net
                Income
              
              
              Weighted
                Average
                Common
                Shares
                Outstanding
              
              Earnings
                Per
      Common
                ShareThree Months Ended
      March 31, 2008:Basic
      earnings per share:Net
      income attributable to common shareholders
              $
              102,569
              
              
              
              52,104
              
              $
              1.97Effect
      of dilutive securities:Common
      share options, restricted common shares and common share
    units
              
              –
              
              
              
              2,662Conversion
      of preferred shares
              
              –
              
              
              
              5,108Preferred
      share dividends
              
              2,602
              
              
              
              –Adjusted
      net income for diluted earnings per share
              $
              105,171
              
              
              
              59,874
              
              $
              1.76Three Months Ended
      March 31, 2007:Basic
      earnings per share:Net
      income attributable to common shareholders
              $
              70,231
              
              
              
              59,718
              
              $
              1.18Effect
      of dilutive securities:Common
      share options, restricted common shares and common share
    units
              
              –
              
              
              
              1,965Conversion
      of preferred shares
              
              –
              
              
              
              5,574Preferred
      share dividends
              
              2,602
              
              
              
              –Adjusted
      net income for diluted earnings per share
              $
              72,833
              
              
              
              67,257
              
              $
              1.08
 
  4.
      Operating
      Segment Information
  We
conduct our worldwide reinsurance business through three operating segments:
Property and Marine, Casualty and Finite Risk.  The Property and
Marine operating segment includes principally property and marine reinsurance
coverages that are written in the United States and international markets,
including property reinsurance, crop reinsurance and marine and aviation
reinsurance.  The Property and Marine operating segment includes
reinsurance contracts that are either catastrophe excess-of-loss, per-risk
excess-of-loss or proportional contracts.  The Casualty operating
segment includes principally reinsurance contracts that cover umbrella
liability, general and product liability, professional liability, workers'
compensation, casualty clash, automobile liability, surety, trade credit,
political risk and accident and health.  The Finite Risk operating
segment includes principally structured reinsurance contracts with ceding
companies whose needs may not be met efficiently through traditional reinsurance
products.  In exchange for contractual features that limit our
downside risk, reinsurance contracts that we classify as finite risk provide the
potential for significant profit commission to the ceding
company.  The classes of risks underwritten through finite risk
contracts are generally consistent with the classes covered by traditional
products.  The finite risk contracts that we underwrite generally
provide prospective protection, meaning coverage is provided for losses that are
incurred after inception of the contract, as contrasted with retrospective
coverage, which covers losses that are incurred prior to inception of the
contract.  The three main categories of finite risk contracts are
quota share, multi-year excess-of-loss and whole account aggregate stop
loss.
  - 7
-
  In
managing our operating segments, we use measures such as underwriting income and
underwriting ratios to evaluate segment performance.  We do not
allocate by segment our assets or certain income and expenses such as investment
income, interest expense and certain corporate expenses.  Total
underwriting income is reconciled to income before income tax
expense.  The measures we use in evaluating our operating segments
should not be used as a substitute for measures determined under U.S.
GAAP.  The following table summarizes underwriting activity and ratios
for the operating segments, together with a reconciliation of total underwriting
income to income before income tax expense, for the three months ended
March 31, 2008 and 2007 ($ in thousands):
  Property
                and
      Marine
              
              
              Casualty
              
              
              Finite
      Risk
              
              TotalThree months ended
      March 31, 2008:Net
      premiums written
              $
              168,817
              
              
              
              125,576
              
              
              
              1,878
              
              $
              296,271Net
      premiums earned
              
              153,390
              
              
              
              147,495
              
              
              
              966
              
              
              301,851Net
      losses and loss adjustment expenses
              
              62,039
              
              
              
              99,393
              
              
              
              (1,229
              )
              
              160,203Net
      acquisition expenses
              
              20,654
              
              
              
              37,488
              
              
              
              2,400
              
              
              60,542Other
      underwriting expenses
              
              8,596
              
              
              
              6,795
              
              
              
              310
              
              
              15,701Segment
      underwriting income (loss)
              $
              62,101
              
              
              
              3,819
              
              
              
              (515
              )
              
              65,405Net
      investment income
              
              
              49,062Net
      realized gains on investments
              
              
              45Net
      foreign currency exchange gains
              
              
              4,869Other
      income
              
              
              2,021Corporate
      expenses not allocated to segments
              
              
              (5,989
              )Interest
      expense
              
              
              (4,750
              )Income
      before income tax expense
              
              $
              110,663Ratios:Net
      loss and loss adjustment expense
              
              40.4
              %
              
              
              67.4
              %
              
              
              (127.2
              %)
              
              53.1
              %Net
      acquisition expense
              
              13.5
              %
              
              
              25.4
              %
              
              
              248.4
              %
              
              20.1
              %Other
      underwriting expense
              
              5.6
              %
              
              
              4.6
              %
              
              
              32.1
              %
              
              5.2
              %Combined
              
              59.5
              %
              
              
              97.4
              %
              
              
              153.3
              %
              
              78.4
              %Three months ended
      March 31, 2007:Net
      premiums written
              $
              137,654
              
              
              
              152,183
              
              
              
              9,080
              
              $
              298,917Net
      premiums earned
              
              119,710
              
              
              
              154,019
              
              
              
              11,119
              
              
              284,848Net
      losses and loss adjustment expenses
              
              62,627
              
              
              
              112,382
              
              
              
              6,904
              
              
              181,913Net
      acquisition expenses
              
              15,935
              
              
              
              32,035
              
              
              
              150
              
              
              48,120Other
      underwriting expenses
              
              10,028
              
              
              
              6,717
              
              
              
              1,034
              
              
              17,779Segment
      underwriting income
              $
              31,120
              
              
              
              2,885
              
              
              
              3,031
              
              
              37,036Net
      investment income
              
              
              51,699Net
      realized losses on investments
              
              
              (18
              )Net
      foreign currency exchange gains
              
              
              42Other
      expense
              
              
              (780
              )Corporate
      expenses not allocated to segments
              
              
              (5,427
              )Interest
      expense
              
              
              (5,455
              )Income
      before income tax expense
              
              $
              77,097Ratios:Net
      loss and loss adjustment expense
              
              52.3
              %
              
              
              73.0
              %
              
              
              62.1
              %
              
              63.9
              %Net
      acquisition expense
              
              13.3
              %
              
              
              20.8
              %
              
              
              1.3
              %
              
              16.9
              %Other
      underwriting expense
              
              8.4
              %
              
              
              4.4
              %
              
              
              9.3
              %
              
              6.2
              %Combined
              
              74.0
              %
              
              
              98.2
              %
              
              
              72.7
              %
              
              87.0
              %
  - 8
-
  5.
      Income
      Taxes
  We
provide for income tax expense based upon income reported in the condensed
consolidated financial statements and the provisions of currently enacted tax
laws.  Platinum Holdings and Platinum Bermuda are incorporated in
Bermuda.  Under current Bermuda law, profits of Platinum Holdings and
Platinum Bermuda are not taxed on any Bermuda income or capital gains and they
have received an assurance that if any legislation is enacted in Bermuda that
would impose tax computed on profits or income, or computed on any capital
asset, gain or appreciation, or any tax in the nature of estate duty or
inheritance tax, then the imposition of any such tax will not be applicable to
Platinum Holdings or Platinum Bermuda or any of their respective operations,
shares, debentures or other obligations until March 28, 2016.  We also
have subsidiaries in the United States, United Kingdom and Ireland that are
subject to the tax laws thereof.  The income tax returns of our U.S.
based subsidiaries that remain open to examination are for calendar years 2003
and forward and tax year 2003 and 2004 are currently under
examination.
  A
reconciliation of expected income tax expense, computed by applying a 35% income
tax rate to income before income taxes, to actual income tax expense for the
three months ended March 31, 2008 and 2007 was as follows ($ in
thousands):
  2008
              
              2007Expected
      income tax expense at 35%
              $
              38,732
              
              $
              26,984Effect
      of foreign income subject to tax at rates other than 35%
              
              (32,704
              )
              
              (22,235
              )Tax
      exempt investment income
              
              (454
              )
              
              (389
              )Other,
      net
              
              (82
              )
              
              (96
              )Income
      tax expense
              $
              5,492
              
              $
              4,264
 
  6.
      Condensed
      Consolidating Financial
Information
  Platinum
Finance is a U.S. based intermediate holding company of Platinum US and a wholly
owned subsidiary of Platinum Regency.  The outstanding Series B 7.5%
Notes, due June 1, 2017, issued by Platinum Finance are fully and
unconditionally guaranteed by Platinum Holdings.  The Series B 6.371%
Remarketed Senior Guaranteed Notes that were issued by Platinum Finance and were
due and fully repaid on November 16, 2007, were also fully and unconditionally
guaranteed by Platinum Holdings.
  The
payment of dividends from our regulated reinsurance subsidiaries is limited by
applicable laws and statutory requirements of the jurisdictions in which the
subsidiaries operate, including Bermuda, the United States and the United
Kingdom.  Based on the regulatory restrictions of the applicable
jurisdictions, the maximum amount available for payment of dividends or other
distributions by Platinum US to Platinum Finance in 2008 without prior
regulatory approval is estimated to be approximately $24,796,000.  The
maximum amount available for payment of dividends or other distributions by the
reinsurance subsidiaries of Platinum Holdings in 2008, including Platinum US,
without prior regulatory approval is estimated to be approximately
$398,241,000.  During the three months ended March 31, 2008 a dividend
of $180,000,000 was paid by Platinum Bermuda to Platinum Holdings.
  The
tables below present condensed consolidating financial information of Platinum
Holdings, Platinum Finance and the non-guarantor subsidiaries of Platinum
Holdings as of March 31, 2008 and December 31, 2007 and for the three
months ended March 31, 2008 and 2007
($ in thousands):
  Condensed
      Consolidating Balance Sheet
                March 31,
      2008
              Platinum
      Holdings
              
              Platinum
      Finance
              
              Non-guarantor
      Subsidiaries
              
              Consolidating
      Adjustments
              
              ConsolidatedASSETSTotal
      investments
              $
              –
              
              
              6,626
              
              
              3,344,058
              
              
              –
              
              $
              3,350,684Investment
      in subsidiaries
              
              1,883,867
              
              
              522,967
              
              
              322,241
              
              
              (2,729,075
              )
              
              –Cash
      and cash equivalents
              
              36,902
              
              
              18,488
              
              
              978,954
              
              
              –
              
              
              1,034,344Reinsurance
      assets
              
              –
              
              
              –
              
              
              567,867
              
              
              –
              
              
              567,867Other
      assets
              
              12,946
              
              
              3,116
              
              
              74,699
              
              
              –
              
              
              90,761Total
      assets
              $
              1,933,715
              
              
              551,197
              
              
              5,287,819
              
              
              (2,729,075
              )
              $
              5,043,656LIABILITIES
      AND
                SHAREHOLDERS’
      EQUITYLiabilitiesReinsurance
      liabilities
              $
              –
              
              
              –
              
              
              2,815,413
              
              
              –
              
              $
              2,815,413Debt
      obligations
              
              –
              
              
              250,000
              
              
              –
              
              
              –
              
              
              250,000Other
      liabilities
              
              4,607
              
              
              5,934
              
              
              38,594
              
              
              –
              
              
              49,135Total
      liabilities
              
              4,607
              
              
              255,934
              
              
              2,854,007
              
              
              –
              
              
              3,114,548Shareholders’
      EquityPreferred
      shares
              
              57
              
              
              –
              
              
              –
              
              
              –
              
              
              57Common
      shares
              
              489
              
              
              –
              
              
              6,250
              
              
              (6,250
              )
              
              489Additional
      paid-in capital
              
              1,174,952
              
              
              193,054
              
              
              1,896,161
              
              
              (2,089,215
              )
              
              1,174,952Accumulated
      other comprehensive income (loss)
              
              (28,460
              )
              
              2,355
              
              
              (26,081
              )
              
              23,726
              
              
              (28,460
              )Retained
      earnings
              
              782,070
              
              
              99,854
              
              
              557,482
              
              
              (657,336
              )
              
              782,070Total
      shareholders' equity
              
              1,929,108
              
              
              295,263
              
              
              2,433,812
              
              
              (2,729,075
              )
              
              1,929,108Total
      liabilities and shareholders’ equity
              $
              1,933,715
              
              
              551,197
              
              
              5,287,819
              
              
              (2,729,075
              )
              $
              5,043,656
   - 9
-
  Condensed
      Consolidating Balance Sheet
                December
      31, 2007
              Platinum
      Holdings
              
              Platinum
      Finance
              
              Non-guarantor
      Subsidiaries
              
              Consolidating
      Adjustments
              
              ConsolidatedASSETSTotal
      investments
              $
              –
              
              
              6,661
              
              
              3,378,563
              
              
              –
              
              $
              3,385,224Investment
      in subsidiaries
              
              1,958,019
              
              
              504,642
              
              
              306,373
              
              
              (2,769,034
              )
              
              –Cash
      and cash equivalents
              
              39,593
              
              
              18,348
              
              
              1,018,338
              
              
              –
              
              
              1,076,279Reinsurance
      assets
              
              –
              
              
              –
              
              
              517,820
              
              
              –
              
              
              517,820Other
      assets
              
              10,815
              
              
              2,106
              
              
              86,506
              
              
              –
              
              
              99,427Total
      assets
              $
              2,008,427
              
              
              531,757
              
              
              5,307,600
              
              
              (2,769,034
              )
              $
              5,078,750LIABILITIES
      AND
                SHAREHOLDERS’
      EQUITYLiabilitiesReinsurance
      liabilities
              $
              –
              
              
              –
              
              
              2,764,299
              
              
              –
              
              $
              2,764,299Debt
      obligations
              
              –
              
              
              250,000
              
              
              –
              
              
              –
              
              
              250,000Other
      liabilities
              
              10,050
              
              
              1,714
              
              
              54,310
              
              
              –
              
              
              66,074Total
      liabilities
              
              10,050
              
              
              251,714
              
              
              2,818,609
              
              
              –
              
              
              3,080,373Shareholders’
      EquityPreferred
      shares
              
              57
              
              
              –
              
              
              –
              
              
              –
              
              
              57Common
      shares
              
              538
              
              
              –
              
              
              6,250
              
              
              (6,250
              )
              
              538Additional
      paid-in capital
              
              1,338,466
              
              
              193,054
              
              
              1,896,161
              
              
              (2,089,215
              )
              
              1,338,466Accumulated
      other comprehensive loss
              
              (24,339
              )
              
              (2,513
              )
              
              (26,814
              )
              
              29,327
              
              
              (24,339
              )Retained
      earnings
              
              683,655
              
              
              89,502
              
              
              613,394
              
              
              (702,896
              )
              
              683,655Total
      shareholders' equity
              
              1,998,377
              
              
              280,043
              
              
              2,488,991
              
              
              (2,769,034
              )
              
              1,998,377Total
      liabilities and shareholders’ equity
              $
              2,008,427
              
              
              531,757
              
              
              5,307,600
              
              
              (2,769,034
              )
              $
              5,078,750
 
 
 Consolidating
      Statement of Operations
                For
      the Three Months Ended March 31, 2008
              Platinum
      Holdings
              
              Platinum
      Finance
              
              Non-guarantor
      Subsidiaries
              
              Consolidating
      Adjustments
              
              ConsolidatedRevenue:Net
      premiums earned
              $
              –
              
              
              –
              
              
              301,851
              
              
              –
              
              $
              301,851Net
      investment income
              
              600
              
              
              225
              
              
              48,237
              
              
              –
              
              
              49,062Net
      realized gains on investments
              
              –
              
              
              3
              
              
              42
              
              
              –
              
              
              45Other
      income, net
              
              449
              
              
              –
              
              
              1,572
              
              
              –
              
              
              2,021Total
      revenue
              
              1,049
              
              
              228
              
              
              351,702
              
              
              –
              
              
              352,979Expenses:Net
      losses and loss adjustment expenses
              
              –
              
              
              –
              
              
              160,203
              
              
              –
              
              
              160,203Net
      acquisition expenses
              
              –
              
              
              –
              
              
              60,542
              
              
              –
              
              
              60,542Operating
      expenses
              
              5,849
              
              
              100
              
              
              15,741
              
              
              –
              
              
              21,690Net
      foreign currency exchange gains
              
              –
              
              
              –
              
              
              (4,869
              )
              
              –
              
              
              (4,869
              )Interest
      expense
              
              –
              
              
              4,750
              
              
              –
              
              
              –
              
              
              4,750Total
      expenses
              
              5,849
              
              
              4,850
              
              
              231,617
              
              
              –
              
              
              242,316Income
      (loss) before income tax expense (benefit)
              
              (4,800
              )
              
              (4,622
              )
              
              120,085
              
              
              –
              
              
              110,663Income
      tax expense (benefit)
              
              –
              
              
              (1,508
              )
              
              7,000
              
              
              –
              
              
              5,492Income
      (loss) before equity in earnings of subsidiaries
              
              (4,800
              )
              
              (3,114
              )
              
              113,085
              
              
              –
              
              
              105,171Equity
      in earnings of subsidiaries
              
              109,971
              
              
              13,465
              
              
              11,007
              
              
              (134,443
              )
              
              –Net
      income
              
              105,171
              
              
              10,351
              
              
              124,092
              
              
              (134,443
              )
              
              105,171Preferred
      dividends
              
              (2,602
              )
              
              –
              
              
              –
              
              
              –
              
              
              (2,602
              )Net
      income attributable to common shareholders
              $
              102,569
              
              
              10,351
              
              
              124,092
              
              
              (134,443
              )
              $
              102,569
 
 - 10
-
 
 Consolidating
      Statement of Operations
                For
      the Three Months Ended March 31, 2007
              Platinum
      Holdings
              
              Platinum
      Finance
              
              Non-guarantor
      Subsidiaries
              
              Consolidating
      Adjustments
              
              ConsolidatedRevenue:Net
      premiums earned
              $
              –
              
              
              –
              
              
              284,848
              
              
              –
              
              $
              284,848Net
      investment income
              
              1,358
              
              
              638
              
              
              49,703
              
              
              –
              
              
              51,699Net
      realized losses on investments
              
              –
              
              
              –
              
              
              (18
              )
              
              –
              
              
              (18
              )Other
      expense, net
              
              (170
              )
              
              –
              
              
              (610
              )
              
              –
              
              
              (780
              )Total
      revenue
              
              1,188
              
              
              638
              
              
              333,923
              
              
              –
              
              
              335,749Expenses:Net
      losses and loss adjustment expenses
              
              –
              
              
              –
              
              
              181,913
              
              
              –
              
              
              181,913Net
      acquisition expenses
              
              –
              
              
              –
              
              
              48,120
              
              
              –
              
              
              48,120Operating
      expenses
              
              5,311
              
              
              96
              
              
              17,799
              
              
              –
              
              
              23,206Net
      foreign currency exchange gains
              
              –
              
              
              –
              
              
              (42
              )
              
              –
              
              
              (42
              )Interest
      expense
              
              –
              
              
              5,455
              
              
              –
              
              
              –
              
              
              5,455Total
      expenses
              
              5,311
              
              
              5,551
              
              
              247,790
              
              
              –
              
              
              258,652Income
      (loss) before income tax expense (benefit)
              
              (4,123
              )
              
              (4,913
              )
              
              86,133
              
              
              –
              
              
              77,097Income
      tax expense (benefit)
              
              –
              
              
              (2,182
              )
              
              6,446
              
              
              –
              
              
              4,264Income
      (loss) before equity in earnings of subsidiaries
              
              (4,123
              )
              
              (2,731
              )
              
              79,687
              
              
              –
              
              
              72,833Equity
      in earnings of subsidiaries
              
              76,956
              
              
              9,655
              
              
              9,470
              
              
              (96,081
              )
              
              –Net
      income
              
              72,833
              
              
              6,924
              
              
              89,157
              
              
              (96,081
              )
              
              72,833Preferred
      dividends
              
              (2,602
              )
              
              –
              
              
              –
              
              
              –
              
              
              (2,602
              )Net
      income attributable to common shareholders
              $
              70,231
              
              
              6,924
              
              
              89,157
              
              
              (96,081
              )
              $
              70,231
  Condensed
      Consolidating Statement of Cash Flows
                For
      the Three Months Ended March 31, 2008
              Platinum
                Holdings
              
              Platinum
      Finance
              
              Non-guarantor
                Subsidiaries
              
              Consolidating
      Adjustments
              
              ConsolidatedNet
      cash provided by (used in) operating activities
              $
              (7,993
              )
              
              94
              
              
              112,733
              
              
              –
              
              $
              104,834Investing
      Activities:Proceeds
      from sale of available-for-sale fixed maturity securities
              
              –
              
              
              45
              
              
              6,132
              
              
              –
              
              
              6,177Proceeds
      from maturity or paydown of available-for-sale fixed maturity
      securities
              
              –
              
              
              –
              
              
              442,368
              
              
              –
              
              
              442,368Acquisition
      of available-for-sale fixed maturities
              
              –
              
              
              –
              
              
              (299,553
              )
              
              –
              
              
              (299,553
              )Proceeds
      from sale of other invested asset
              
              –
              
              
              –
              
              
              –
              
              
              –
              
              
              –Increase
      in short-term investments
              
              –
              
              
              –
              
              
              (121,064
              )
              
              –
              
              
              (121,064
              )Dividends
      from subsidiaries
              
              180,000
              
              
              –
              
              
              –
              
              
              (180,000
              )
              
              –Net
      cash provided by investing activities
              
              180,000
              
              
              45
              
              
              27,883
              
              
              (180,000
              )
              
              27,928Financing
      Activities:Dividends
      paid to preferred shareholders
              
              (2,602
              )
              
              –
              
              
              
              
              
              –
              
              
              (2,602
              )Dividends
      paid to common shareholders
              
              (4,154
              )
              
              –
              
              
              (180,000
              )
              
              180,000
              
              
              (4,154
              )Proceeds
      from exercise of share options
              
              –
              
              
              –
              
              
              –
              
              
              –
              
              
              –Purchase
      of common shares
              
              (167,941
              )
              
              –
              
              
              –
              
              
              –
              
              
              (167,941
              )Net
      cash used in financing activities
              
              (174,697
              )
              
              –
              
              
              (180,000
              )
              
              180,000
              
              
              (174,697
              )Net
      increase (decrease) in cash and cash equivalents
              
              (2,690
              )
              
              139
              
              
              (39,384
              )
              
              –
              
              
              (41,935
              )Cash
      and cash equivalents at beginning of period
              
              39,592
              
              
              18,349
              
              
              1,018,338
              
              
              –
              
              
              1,076,279Cash
      and cash equivalents at end of period
              $
              36,902
              
              
              18,488
              
              
              978,954
              
              
              –
              
              $
              1,034,344
   - 11
-
  Condensed
      Consolidating Statement of Cash Flows
                For
      the Three Months Ended March 31, 2007
              Platinum
      Holdings
              
              Platinum
      Finance
              
              Non-guarantor
                Subsidiaries
              
              Consolidating
      Adjustments
              
              ConsolidatedNet
      cash provided by (used in) operating activities
              $
              (3,906
              )
              
              577
              
              
              122,875
              
              
              –
              
              $
              119,546Investing
      Activities:Proceeds
      from maturity or paydown of available-for-sale fixed
      maturities
              
              –
              
              
              599
              
              
              270,436
              
              
              –
              
              
              271,035Acquisition
      of available-for-sale fixed maturities
              
              –
              
              
              –
              
              
              (457,939
              )
              
              –
              
              
              (457,939
              )Proceeds
      from sale of other invested asset
              
              –
              
              
              –
              
              
              4,745
              
              
              –
              
              
              4,745Increase
      in short-term investments
              
              –
              
              
              –
              
              
              19,006
              
              
              –
              
              
              19,006Net
      cash provided by (used in) investing activities
              
              –
              
              
              599
              
              
              (163,752
              )
              
              –
              
              
              (163,153
              )Financing
      Activities:Dividends
      paid to preferred shareholders
              
              (2,602
              )
              
              –
              
              
              –
              
              
              –
              
              
              (2,602
              )Dividends
      paid to common shareholders
              
              (4,784
              )
              
              –
              
              
              –
              
              
              –
              
              
              (4,784
              )Proceeds
      from exercise of share options
              
              2,993
              
              
              –
              
              
              –
              
              
              –
              
              
              2,993Net
      cash used in financing activities
              
              (4,393
              )
              
              –
              
              
              –
              
              
              –
              
              
              (4,393
              )Net
      increase (decrease) in cash and cash equivalents
              
              (8,299
              )
              
              1,176
              
              
              (40,877
              )
              
              –
              
              
              (48,000
              )Cash
      and cash equivalents at beginning of period
              
              106,039
              
              
              39,294
              
              
              706,319
              
              
              –
              
              
              851,652Cash
      and cash equivalents at end of period
              $
              97,740
              
              
              40,470
              
              
              665,442
              
              
              –
              
              $
              803,652
 
  7.
      Company Share
      Repurchase
  On August
4, 2004 our Board of Directors established a program to repurchase our common
shares.  On July 26, 2007 our Board of Directors approved an increase
in the then existing repurchase program to result in authority as of such date
to repurchase up to a total of $250,000,000 of our common
shares.  After repurchases of our common shares, on each of
October 25, 2007, February 21, 2008 and April 23, 2008, our Board
of Directors approved additional increases in the repurchase program to result
in authority as of such dates to repurchase up to a total of $250,000,000 of our
common shares.  During the three months ended March 31, 2008, the
Company repurchased 4,926,992 of its common shares in the open market at an
aggregate cost of $167,941,000 and a weighted average cost of $34.09 per
share.  The common shares we repurchased were canceled.
   ITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
      OF OPERATIONS
  Business
Overview
  Platinum
Underwriters Holdings, Ltd. ("Platinum Holdings") is a Bermuda holding company
organized in 2002.  Platinum Holdings and its subsidiaries
(collectively, the "Company") operate through two licensed reinsurance
subsidiaries:  Platinum Underwriters Bermuda, Ltd. ("Platinum
Bermuda") and Platinum Underwriters Reinsurance, Inc. ("Platinum
US").  The terms "we", "us", and "our" also refer to Platinum Holdings
and its consolidated subsidiaries, unless the context otherwise
indicates.  We provide property and marine, casualty and finite risk
reinsurance coverages, through reinsurance intermediaries, to a diverse
clientele of insurers and select reinsurers on a worldwide
basis.   Through December 31, 2006, we also underwrote
business through Platinum Re (UK) Limited ("Platinum UK").  In 2007
Platinum UK ceased underwriting reinsurance business.
  The
following discussion and analysis should be read in conjunction with the
consolidated financial statements and related notes thereto and management's
discussion and analysis of financial condition and results of operations
included in our Annual Report on Form 10-K for the year ended December 31,
2007.  Our condensed consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States ("U.S. GAAP").
  We write
property and casualty reinsurance.  Property reinsurance protects a
ceding company against financial loss arising out of damage to the insured’s
property or loss of its use caused by an insured peril.  Property
reinsurance covers damage principally to buildings and their contents and may be
in the form of catastrophe coverage or per-risk coverage.  Catastrophe
reinsurance coverage protects a ceding company against losses arising out of
multiple claims for a single event, while per-risk reinsurance coverage protects
a ceding company against loss arising out of a single claim for a single risk or
policy.  We also write marine reinsurance which protects a ceding
company against financial loss arising out of damage to ships and
cargo.  Casualty reinsurance protects a ceding company against
financial loss arising out of the insured’s obligation to others for loss or
damage to their persons or property.  Examples of casualty coverages
are umbrella liability, general and product liability, professional liability,
workers' compensation, casualty clash, automobile liability, surety, trade
credit, political risk and accident and health.  Casualty reinsurance
may also be in the form of catastrophe and per-risk contracts.
  The
property and casualty reinsurance industry is highly competitive.  We
compete with reinsurers worldwide, many of which have greater financial,
marketing and management resources than we do.  Our competitors vary
by type of business.  Large multi-national and multi-line reinsurers
represent some of our competitors in all lines and classes, while specialty
reinsurance companies in the United States compete in selective
lines.  Bermuda-based reinsurers tend to be significant competitors on
property catastrophe business.  Lloyd’s of London syndicates are our
significant competitors on marine business.  For casualty and other
international classes of business, the large U.S. and European reinsurers are
our significant competitors.  Financial institutions have also created
alternative capital market products that compete with reinsurance products, such
as reinsurance securitization.
  The
reinsurance industry historically has been cyclical, characterized by periods of
price competition due to excessive underwriting capacity as well as periods of
favorable pricing due to shortages of underwriting capacity.  Cyclical
trends in the industry and the industry's profitability can also be
significantly affected by volatile developments, including natural and other
catastrophes, such as hurricanes, windstorms, earthquakes, floods, fires,
explosions and terrorist attacks, the frequency and severity of which are
inherently difficult to predict.  Property and casualty reinsurance
rates often rise in the aftermath of significant catastrophe
losses.  To the extent that actual claim liabilities are higher than
anticipated, the industry's capacity to write new business
diminishes.  The industry is also affected by changes in the
propensity of courts to expand insurance coverage and grant large liability
awards, as well as fluctuations in interest rates, inflation and other changes
in the economic environment that affect market prices of
investments.
  - 12
-
   Results of
Operations
  Net
income for the three months ended March 31, 2008 and 2007 was as follows ($
in thousands):
  2008
              
              
              2007
              
              
              IncreaseNet
      income
              
              $
              105,171
              
              
              
              72,833
              
              
              $
              32,338
 
 The
increase in net income in 2008 as compared with 2007 was primarily due to an
increase in underwriting income of $28,369,000.  The increase in
underwriting income was due to an increase in net favorable development and a
decrease in major catastrophe losses.  Actual reported losses were
significantly less than expected and gained sufficient credibility in the
current period to reduce estimated ultimate losses.  Net favorable
development was $29,455,000 and $13,895,000 in 2008 and 2007,
respectively.  The estimated net adverse impact in 2007 from European
storm Kyrill was $20,000,000 as compared to a net adverse impact of $6,500,000
from European storm Emma in 2008.
  Gross,
ceded and net premiums written and earned for the three months ended
March 31, 2008 and 2007 were as follows ($ in thousands):
  2008
              
              
              2007
              
              
              Increase
                (decrease)Gross
      premiums written
              
              $
              300,354
              
              
              
              303,135
              
              
              $
              (2,781
              )Ceded
      premiums written
              
              
              4,083
              
              
              
              4,218
              
              
              
              (
      135
              )Net
      premiums written
              
              
              296,271
              
              
              
              298,917
              
              
              
              (2,646
              )Gross
      premiums earned
              
              
              306,875
              
              
              
              292,023
              
              
              
              14,852Ceded
      premiums earned
              
              
              5,024
              
              
              
              7,175
              
              
              
              (2,151
              )Net
      premiums earned
              
              $
              301,851
              
              
              
              284,848
              
              
              $
              17,003
 
 The
decrease in gross premiums written in 2008 as compared with 2007 was primarily
attributable to decreases in gross premiums written across most classes in the
Casualty segment, substantially offset by an increase in property gross written
premiums.  Also impacting 2008 were increases in estimates of net
premiums written of $16,478,000 and net premiums earned of $17,305,000 that
related to business written in prior underwriting years and resulted from
changes in their estimated patterns of attachment.  The increase in
net premiums earned was also due to changes in the mix of business and the
structure of the underlying contracts.
  Net
investment income for the three months ended March 31, 2008 and 2007 was
$49,062,000 and $51,699,000, respectively.  Net investment income
decreased in 2008 as compared with 2007 primarily due to a decrease in yields on
invested assets as well as a slight decrease in invested assets.  Net
investment income included interest earned on funds held of $837,000 and
$1,705,000 in 2008 and 2007, respectively.  Net realized gains
(losses) on investments were $45,000 and ($18,000) in 2008 and 2007,
respectively.  Net realized gains and losses on investments primarily
resulted from our efforts to manage credit quality and cash flows.
  Other
income (expense) for the three months ended March 31, 2008 and 2007 was
$2,021,000 and ($780,000), respectively.  Other income in 2008
included $2,927,000 of net unrealized gains relating to changes in fair value of
fixed maturity securities classified as trading, an expense of $810,000 for the
fair value adjustment of derivative contracts, and $73,000 of net expense on
reinsurance contracts accounted for as deposits.  Other expense in
2007 included $665,000 of net unrealized losses relating to changes in the fair
value of fixed maturity securities classified as trading and $115,000 of net
expense relating to reinsurance contracts accounted for as
deposits.
  Net
losses and loss adjustment expenses ("LAE") and the resulting net loss and LAE
ratios for the three months ended March 31, 2008 and 2007 were as follows
($ in thousands):
  2008
              
              
              2007
              
              
              DecreaseNet
      losses and LAE
              
              $
              160,203
              
              
              
              181,913
              
              
              $
              (21,710
              )Net
      loss and LAE ratios
              
              
              53.1
              %
              
              
              63.9
              %
              
              (10.8)
      points
 
 The
decrease in net losses and LAE and the related ratios in 2008 as compared
to 2007 were due to a decrease in major catastrophe losses and an increase in
net favorable loss development.  European storm Kyrill resulted in
$24,520,000 of losses in 2007, which increased the net loss and LAE ratio by 8.7
points, compared to $6,500,000 of losses from European storm Emma in 2008, which
increased the net loss and LAE ratio by 2.2 points.  Net losses and
LAE and the resulting net loss and LAE ratios were also impacted by net
favorable loss development of $29,086,000 in 2008, which decreased the net loss
and LAE ratio by 9.6 points, and $12,577,000 in 2007, which decreased the net
loss and LAE ratio by 4.4 points.  The net loss and LAE ratios were
also affected by changes in the mix of business.
  Net
acquisition expenses and resulting net acquisition expense ratios for the three
months ended March 31, 2008 and 2007 were as follows ($ in
thousands):
  2008
              
              
              2007
              
              
              IncreaseNet
      acquisition expenses
              
              $
              60,542
              
              
              
              48,120
              
              
              $
              12,422Net
      acquisition expense ratios
              
              
              20.1
              %
              
              
              16.9
              %
              
              3.2
      points
 
 The
increase in net acquisition expenses in 2008 as compared with 2007 was due to
the increase in the net acquisition expense ratio and the increase in net
premiums earned.  The increase in the net acquisition expense ratio in
2008 as compared with 2007 was primarily due to changes in the mix of business
primarily within the Casualty segment towards contracts with higher acquisition
cost ratios.
  - 13
-
  Operating
expenses for the three months ended March 31, 2008 and 2007 were
$21,690,000 and $23,206,000, respectively.  Operating expenses
included costs such as salaries, rent and like items related to reinsurance
operations as well as costs associated with Platinum Holdings and its
non-operating intermediate holding company subsidiaries.  The decrease
in 2008 as compared with 2007 was primarily due to the expiration on September
30, 2007 of the Services and Capacity Reservation Agreement with Renaissance Re
Holdings Ltd. (“RenaissanceRe”) effective October 1, 2002 (the "RenRe
Agreement") pursuant to which RenaissanceRe provided consulting services to us
in connection with our property catastrophe book of business.  In 2007
we incurred fees of $2,880,000 under the RenRe Agreement.
  Net
foreign currency exchange gains for the three months ended March 31, 2008
and 2007 were $4,869,000 and $42,000, respectively.  Foreign currency
exchange gains and losses result from the re-valuation into U.S. dollars of
assets and liabilities denominated in currencies other than the U.S.
dollar.  We periodically monitor our foreign currency exposures and
may purchase or sell foreign currency denominated assets based on these
exposures.  The net foreign currency exchange gain in 2008 was the
result of our holding more non-U.S. dollar denominated assets than non-U.S.
dollar denominated liabilities, primarily the Euro, in the normal course of
doing business in these currencies, while the U.S. dollar declined in value
against these currencies.
  Interest
expense for the three months ended March 31, 2008 and 2007 was $4,750,000
and $5,455,000, respectively.  The decrease in interest expense was
the result of a reduction in the debt obligations outstanding in 2008 as
compared to 2007.
  Income
tax expense and the effective income tax rates for the three months ended
March 31, 2008 and 2007 were as follows ($ in thousands):
  2008
              
              
              2007
              
              
              Increase
                (decrease)Income
      tax expense
              
              $
              5,492
              
              
              
              4,264
              
              
              $
              1,228Effective
      income tax rates
              
              
              5.0
              %
              
              
              5.5
              %
              
              (0.5)
      points
 
 The
increase in income tax expense in 2008 as compared with 2007 was due to the
increase in taxable income generated by our subsidiaries that operate in taxable
jurisdictions.  The decrease in the effective income tax rate was the
result of a greater portion of income before income tax expense being generated
by Platinum Holdings and Platinum Bermuda in 2008, which are not subject to
corporate income tax.  In 2008, the combined net income before income
tax expense derived from Platinum Holdings and Platinum Bermuda was 84.0% as
compared to 81.2% in 2007.  The effective tax rate in any
given period is based on income before income tax expense of our
subsidiaries that operate in various taxable jurisdictions, each of which has
its own corporate income tax rate.
  Segment
Information
  We
conduct our worldwide reinsurance business through three operating
segments:  Property and Marine, Casualty and Finite
Risk.  In managing our operating segments, we use measures such as
underwriting income and underwriting ratios to evaluate segment
performance.  We do not allocate by segment our assets or certain
income and expenses such as investment income, interest expense and certain
corporate expenses.  Total underwriting income is reconciled to income
before income tax expense.  The measures we use in evaluating our
operating segments should not be used as a substitute for measures determined
under U.S. GAAP.  The following table summarizes underwriting activity
and ratios for each of the three operating segments for the three months ended
March 31, 2008 and 2007 ($ in thousands):
  Property
                and
      Marine
              
              
              Casualty
              
              
              Finite
      Risk
              
              
              TotalThree months ended
      March 31, 2008:Net
      premiums written
              
              $
              168,817
              
              
              
              125,576
              
              
              
              1,878
              
              
              $
              296,271Net
      premiums earned
              
              
              153,390
              
              
              
              147,495
              
              
              
              966
              
              
              
              301,851Net
      losses and LAE
              
              
              62,039
              
              
              
              99,393
              
              
              
              (1,229
              )
              
              
              160,203Net
      acquisition expenses
              
              
              20,654
              
              
              
              37,488
              
              
              
              2,400
              
              
              
              60,542Other
      underwriting expenses
              
              
              8,596
              
              
              
              6,795
              
              
              
              310
              
              
              
              15,701Segment
      underwriting income (loss)
              
              $
              62,101
              
              
              
              3,819
              
              
              
              (515
              )
              
              
              65,405Net
      investment income
              
              
              
              49,062Net
      realized gains on investments
              
              
              
              45Net
      foreign currency exchange gains
              
              
              
              4,869Other
      income
              
              
              
              2,021Corporate
      expenses not allocated to segments
              
              
              
              (5,989
              )Interest
      expense
              
              
              
              (4,750
              )Income
      before income tax expense
              
              
              $
              110,663Ratios:Net
      loss and LAE
              
              
              40.4
              %
              
              
              67.4
              %
              
              
              (127.2
              %)
              
              
              53.1
              %Net
      acquisition expense
              
              
              13.5
              %
              
              
              25.4
              %
              
              
              248.4
              %
              
              
              20.1
              %Other
      underwriting expense
              
              
              5.6
              %
              
              
              4.6
              %
              
              
              32.1
              %
              
              
              5.2
              %Combined
              
              
              59.5
              %
              
              
              97.4
              %
              
              
              153.3
              %
              
              
              78.4
              %
   - 14
-
  Property
                and
      Marine
              
              
              
              Casualty
              
              
              
              Finite
      Risk
              
              
              
              TotalThree months ended
      March 31, 2007:Net
      premiums written
              
              $
              137,654
              
              
              
              152,183
              
              
              
              9,080
              
              
              $
              298,917Net
      premiums earned
              
              
              119,710
              
              
              
              154,019
              
              
              
              11,119
              
              
              
              284,848Net
      losses and LAE
              
              
              62,627
              
              
              
              112,382
              
              
              
              6,904
              
              
              
              181,913Net
      acquisition expenses
              
              
              15,935
              
              
              
              32,035
              
              
              
              150
              
              
              
              48,120Other
      underwriting expenses
              
              
              10,028
              
              
              
              6,717
              
              
              
              1,034
              
              
              
              17,779Segment
      underwriting income
              
              $
              31,120
              
              
              
              2,885
              
              
              
              3,031
              
              
              
              37,036Net
      investment income
              
              
              
              51,699Net
      realized losses on investments
              
              
              
              (18
              )Net
      foreign currency exchange gains
              
              
              
              42Other
      expense
              
              
              
              (780
              )Corporate
      expenses not allocated to segments
              
              
              
              (5,427
              )Interest
      expense
              
              
              
              (5,455
              )Income
      before income tax expense
              
              
              $
              77,097Ratios:Net
      loss and LAE
              
              
              52.3
              %
              
              
              73.0
              %
              
              
              62.1
              %
              
              
              63.9
              %Net
      acquisition expense
              
              
              13.3
              %
              
              
              20.8
              %
              
              
              1.3
              %
              
              
              16.9
              %Other
      underwriting expense
              
              
              8.4
              %
              
              
              4.4
              %
              
              
              9.3
              %
              
              
              6.2
              %Combined
              
              
              74.0
              %
              
              
              98.2
              %
              
              
              72.7
              %
              
              
              87.0
              %
 
 
 Property and Marine
  The
Property and Marine operating segment includes principally property (including
crop) and marine reinsurance coverages that are written in the United States and
international markets.  This business includes property catastrophe
excess-of-loss contracts, property per-risk excess-of-loss contracts and
property proportional contracts.  This operating segment represented
57.0% and 46.1% of our net premiums written during the three months ended
March 31, 2008 and 2007, respectively.
  Gross,
ceded and net premiums written and earned for the three months ended
March 31, 2008 and 2007 were as follows ($ in thousands):
  2008
              
              
              2007
              
              
              Increase
                (decrease)Gross
      premiums written
              
              $
              172,900
              
              
              
              143,791
              
              
              $
              29,109Ceded
      premiums written
              
              
              4,083
              
              
              
              6,137
              
              
              
              (2,054
              )Net
      premiums written
              
              
              168,817
              
              
              
              137,654
              
              
              
              31,163Gross
      premiums earned
              
              
              158,414
              
              
              
              128,817
              
              
              
              29,597Ceded
      premiums earned
              
              
              5,024
              
              
              
              9,107
              
              
              
              (4,083
              )Net
      premiums earned
              
              $
              153,390
              
              
              
              119,710
              
              
              $
              33,680
 
 The
increase in gross premiums written in 2008 as compared to 2007 was primarily due
to an increase in North American crop business.  In addition there was
an increase in reinstatement premiums in the ocean marine class associated with
large loss activity.  The decline in ceded premiums written was
attributable to the non-renewal in 2007 of a quota share retrocessional
agreement under which we ceded 30% of our property catastrophe
business.  Net premiums earned in 2008 increased primarily as a result
of the increase in gross premiums written.  Net premiums written and
earned in 2008 also included increases in estimates of net premiums written of
$4,663,000 and net premiums earned of $3,892,000 that related to business
written in prior underwriting years, and changes in their estimated patterns of
attachment.
  Net
losses and LAE and the resulting net loss and LAE ratios for the three months
ended March 31, 2008 and 2007 were as follows ($ in
thousands):
  2008
              
              
              2007
              
              
              DecreaseNet
      losses and LAE
              
              $
              62,039
              
              
              
              62,627
              
              
              $
              588Net
      loss and LAE ratios
              
              
              40.4
              %
              
              
              52.3
              %
              
              11.9
      points
  The
decrease in net losses and LAE and the related ratios in 2008 as compared to
2007 were due to a decrease in major catastrophe losses and an increase in net
favorable loss development.  European storm Kyrill resulted in
$24,520,000 of losses in 2007, which increased the net loss and LAE ratio by
21.3 points, compared to $6,500,000 of losses from European storm Emma in 2008,
which increased the net loss and LAE ratio by 4.2 points.  Net losses
and LAE and the resulting net loss and LAE ratios were also impacted by net
favorable loss development of $15,231,000 in 2008, which decreased the net loss
and LAE ratio by 10.3 points, and $8,195,000 in 2007, which decreased the net
loss and LAE ratio by 6.8 points.  Exclusive of losses resulting from
European storms Kyrill and Emma and net favorable development, the net loss and
LAE ratio increased by approximately 8.0 points due primarily to an increase in
crop quota share business that has a higher expected loss ratio than the
remainder of the segment.  In addition, expected loss ratios for the
2008 underwriting year for most classes were higher than for the 2007
underwriting year due to decreasing rates.  The net loss and LAE
ratios were also affected by other changes in the mix of business.
 - 15
-
 Net
acquisition expenses and resulting net acquisition expense ratios for the three
months ended March 31, 2008 and 2007 were as follows ($ in
thousands):
  2008
              
              
              2007
              
              
              IncreaseNet
      acquisition expenses
              
              $
              20,654
              
              
              
              15,935
              
              
              $
              4,719Net
      acquisition expense ratios
              
              
              13.5
              %
              
              
              13.3
              %
              
              0.2
      points
 
 The
increase in net acquisition expenses in 2008 as compared with 2007 was primarily
due to an increase in net premiums earned.  The net acquisition
expense ratios were comparable.
  Other
underwriting expenses in 2008 and 2007 were $8,596,000 and $10,028,000,
respectively.  The decrease in 2008 as compared with 2007 was
primarily due to the expiration of the RenRe Agreement on September 30,
2007.  We incurred fees of $2,880,000 under the RenRe Agreement in
2007.
   Casualty
  The
Casualty operating segment includes principally reinsurance contracts that cover
umbrella liability, general and product liability, professional liability,
workers' compensation, casualty clash, automobile liability, surety, trade
credit, political risk and accident and health.  This operating
segment represented 42.4% and 50.9% of our net premiums written during the three
months ended March 31, 2008 and 2007, respectively.
  Gross,
ceded and net premiums written and earned for the three months ended March 31,
2008 and 2007 were as follows ($ in thousands):
  2008
              
              
              2007
              
              
              DecreaseGross
      premiums written
              
              $
              125,576
              
              
              
              152,206
              
              
              $
              26,630Ceded
      premiums written
              
              
              –
              
              
              
              23
              
              
              
              23Net
      premiums written
              
              
              125,576
              
              
              
              152,183
              
              
              
              26,607Gross
      premiums earned
              
              
              147,495
              
              
              
              154,029
              
              
              
              6,534Ceded
      premiums earned
              
              
              –
              
              
              
              10
              
              
              
              10Net
      premiums earned
              
              $
              147,495
              
              
              
              154,019
              
              
              $
              6,524
 
 The
decrease in net premiums written in 2008 as compared with 2007 was primarily due
to decreases in business underwritten in 2007 and 2008 across most North
American casualty classes with the most significant decreases in the umbrella
class.  The decrease was the result of fewer opportunities that met
our underwriting standards.  Also impacting premiums written and
earned were changes in estimates in prior underwriting years’ ultimate premiums
and the patterns of their attachment resulting in increases in 2008 of net
premiums written of $11,792,000 and net premiums earned of
$13,390,000.  Net premiums written and earned were also affected by
changes in the mix of business and the structure of the underlying reinsurance
contracts.
  Net
losses and LAE and the resulting net loss and LAE ratios for the three months
ended March 31, 2008 and 2007 were as follows ($ in
thousands):
  2008
              
              
              2007
              
              
              DecreaseNet
      losses and LAE
              
              $
              99,393
              
              
              
              112,382
              
              
              $
              12,989Net
      loss and LAE ratios
              
              
              67.4
              %
              
              
              73.0
              %
              
              5.6
      points
 
 The
decrease in net losses and LAE and the related ratios in 2008 as compared with
2007 were primarily due to the decrease in net premiums earned and an increase
in net favorable loss development.  Net favorable loss development was
$12,088,000 in 2008, which decreased the net loss and LAE ratio by 8.2 points,
as compared with $1,397,000 in 2007, which decreased the net loss and LAE ratio
by 0.9 points.  Excluding the impact of net favorable loss
development, the net loss and LAE ratio increased by 0.8 points in 2008 as
compared with 2007 due to higher initial expected loss ratios in certain
significant classes reflecting a decline in price adequacy.  The net
loss and LAE ratio in 2008 was also affected by the changes in the mix of
business.
 Net
acquisition expenses and resulting net acquisition expense ratios for the three
months ended March 31, 2008 and 2007 were as follows ($ in
thousands):
  2008
              
              
              2007
              
              
              IncreaseNet
      acquisition expenses
              
              $
              37,488
              
              
              
              32,035
              
              
              $
              5,453Net
      acquisition expense ratios
              
              
              25.4
              %
              
              
              20.8
              %
              
              4.6
      points
 
 The
increase in net acquisition expenses in 2008 as compared with 2007 was due to
differences in changes to adjustable commission.  Net acquisition
expenses included an increase in adjustable commissions of $3,418,000 in 2008
related to favorable net loss development from prior years, representing 2.5% of
net premiums earned as compared with a decrease of $2,190,000 in 2007,
representing 1.4% of net premiums earned.  Net acquisition expense
ratios were also impacted by changes in the mix of business.
  Other
underwriting expenses were comparable at $6,795,000 and $6,717,000 for the three
months ended March 31, 2008 and 2007, respectively.
   - 16
-
 
 Finite
Risk
  The
Finite Risk operating segment includes principally structured reinsurance
contracts with ceding companies whose needs may not be met efficiently through
traditional reinsurance products.  In exchange for contractual
features that limit our downside risk, reinsurance contracts that we classify as
finite risk provide the potential for significant profit commission to the
ceding company.  The classes of risks underwritten through finite risk
contracts are generally consistent with the classes covered by traditional
products.  The finite risk contracts that we underwrite generally
provide prospective protection, meaning coverage is provided for losses that are
incurred after inception of the contract, as contrasted with retrospective
coverage, which covers losses that are incurred prior to inception of the
contract.  The three main categories of our finite risk contracts are
quota share, multi-year excess-of-loss and whole account aggregate stop
loss.  Due to the often significant inverse relationship between
losses and commissions for this segment, we believe it is important to evaluate
the overall combined ratio, rather than its component parts of net loss and LAE
ratio and net acquisition expense ratio.  The industry-wide
investigations by governmental and regulatory authorities into potential misuse
of finite products curtailed demand for these products beginning in
2005.  This diminished demand continues in 2008.  This
operating segment represented 0.6% and 3.0% of our net premiums written during
the three months ended March 31, 2008 and 2007, respectively.
  Gross,
ceded and net premiums written and earned for the three months ended
March 31, 2008 and 2007 were as follows ($ in thousands):
  2008
              
              
              2007
              
              
              Increase
                (decrease)Gross
      premiums written
              
              $
              1,878
              
              
              
              7,138
              
              
              $
              (5,260
              )Ceded
      premiums written
              
              
              –
              
              
              
              (1,942
              )
              
              
              1,942Net
      premiums written
              
              
              1,878
              
              
              
              9,080
              
              
              
              (7,202
              )Gross
      premiums earned
              
              
              966
              
              
              
              9,177
              
              
              
              (8,211
              )Ceded
      premiums earned
              
              
              –
              
              
              
              (1,942
              )
              
              
              1,942Net
      premiums earned
              
              $
              966
              
              
              
              11,119
              
              
              $
              (10,153
              )
 
 The
decreases in net premiums written and net premiums earned in 2008 as compared
with 2007 reflect the continuing reduction in the demand for finite
business.
  Net
losses and LAE, net acquisition expenses and the resulting net loss and LAE and
acquisition ratios for the three months ended March 31, 2008 and 2007 were
as follows ($ in thousands):
  2008
              
              
              2007
              
              
              Increase
                (decrease)Net
      losses and LAE
              
              $
              (1,229
              )
              
              
              6,904
              
              
              $
              (8,133
              )Net
      acquisition expenses
              
              
              2,400
              
              
              
              150
              
              
              
              2,250Net
      losses, LAE and acquisition expenses
              
              $
              1,171
              
              
              
              7,054
              
              
              $
              (5,883
              )Net
      loss, LAE and acquisition expense ratios
              
              
              121.2
              %
              
              
              63.4
              %
              
              57.8
      points
 
 The
decrease in net losses, LAE and acquisition expenses in 2008 as compared with
2007 was primarily due to the decrease in net premiums earned.  The
increase in the net loss, LAE and acquisition expense ratio was primarily due to
an increase in profit commission from prior years.  Net unfavorable
development was $213,000 in 2008, which increased the net loss and LAE ratio by
22.0 points, as compared with net favorable development of approximately
$2,688,000 in 2007, which decreased the net loss and LAE ratio by 24.2
points.  Also contributing to the increase in the net loss, LAE and
acquisition expense ratio in 2008 was the expiration of a significant finite
casualty contract that had a lower combined ratio than the remainder of the
Finite Risk segment.
 Other
underwriting expenses for the three months ended March 31, 2008 and 2007
were $310,000 and $1,034,000, respectively.  The decrease in 2008 as
compared with 2007 was due to a decline in underwriting activity in the segment
and a lower percentage of underwriting expenses allocated to the
segment.
  Financial Condition,
Liquidity and Capital Resources
   Financial Condition
  Cash and
cash equivalents and investments as of March 31, 2008 and December 31,
2007 were as follows ($ in thousands):
  March 31,
      2008
              
              December 31,2007
              
              
              Increase
                (decrease)Cash
      and cash equivalents
              
              $
              1,034,344
              
              
              1,076,279
              
              
              $
              (41,935
              )Fixed
      maturity securities
              
              
              3,205,200
              
              
              3,361,741
              
              
              
              (156,541
              )Preferred
      stocks
              
              
              10,066
              
              
              9,607
              
              
              
              459Short-term
      investments
              
              
              135,418
              
              
              13,876
              
              
              
              121,542Total
              
              $
              4,385,028
              
              
              4,461,503
              
              
              $
              (76,475
              )
 
 The net
decrease in total cash and cash equivalents and investments as of March 31,
2008 as compared with December 31, 2007 was primarily due to our share
repurchases in 2008.  Our available-for-sale and trading portfolios
are primarily composed of diversified, high quality, predominantly publicly
traded fixed maturity securities.  The investment portfolio, excluding
cash and cash equivalents, had a weighted average duration of 3.1 years as of
March 31, 2008.  We routinely monitor the composition of our
investment portfolio and cash flows in order to maintain liquidity necessary to
meet our obligations.
  - 17
-
 As of
March 31, 2008, we had $1,403,483,000 of mortgage-backed and asset-backed
securities in our investment portfolio, representing approximately 32% of cash
and cash equivalents and investments.  The following is a breakdown of
our mortgage-backed and asset-backed securities as of March 31, 2008 ($ amounts
in thousands):
  Amortized
                Cost
              
              
              Fair
                Value
              
              Weighted
                Average
                Credit
      RatingU.S.
      Government agency mortgage-backed securities
              
              $
              638,388
              
              
              $
              646,273
              
              AaaCommercial
      mortgage-backed securities
              
              
              394,029
              
              
              
              377,900
              
              AaaAsset-backed
      securities
              
              
              203,789
              
              
              
              194,837
              
              AaaResidential
      mortgage-backed securities
              
              
              195,866
              
              
              
              184,473
              
              AaTotal
              
              $
              1,432,072
              
              
              $
              1,403,483
              
              Aaa
 
 Approximately
46% of the mortgage-backed and asset-backed securities in our investment
portfolio were issued or guaranteed by the Government National Mortgage
Association, the Federal National Mortgage Association, or the Federal Home Loan
Mortgage Corporation and are referred to as U.S. Government agency
mortgage-backed securities.  Included in residential
mortgage-backed securities were securities with an amortized cost of
$22,290,000 and fair value of $20,865,000 where the underlying collateral
consists primarily of “Alt-A” mortgages.  These securities have a
weighted average credit rating of Aa at March 31, 2008.
  The U.S.
sub-prime residential mortgage market has experienced significantly increased
delinquencies which resulted in increased volatility and decreased liquidity in
the financial markets and the structured securities markets in
particular.  Our securities with underlying sub-prime mortgage
exposure were categorized above as asset-backed securities and were investment
grade at March 31, 2008.  The following table summarizes our nine
asset-backed securities within our fixed income portfolio exposed to the
sub-prime residential mortgage market as of March 31, 2008 ($ in
thousands):
  AmortizedCost
              
              Fair
      ValueVintage
      year 2005 and ratings of Aa or A
              
              $
              38,136
              
              $
              28,133Vintage
      year 2006 and ratings of Aaa
              
              
              3,994
              
              
              2,860Total
              
              $
              42,130
              
              $
              30,993
 
 We
continually monitor market events impacting our portfolio, including our
sub-prime securities, and review sub-prime securities along with the rest of our
portfolio for potential other-than-temporary impairments.  We did not
consider any of the mortgage-backed and asset-backed securities we hold to be
other-than-temporarily impaired as of March 31, 2008.
  Certain
assets and liabilities associated with underwriting include significant
estimates.  Reinsurance premiums receivable, deferred acquisition
costs, unpaid losses and LAE, unearned premiums and commissions payable all
represent or include significant estimates.  Reinsurance premiums
receivable as of March 31, 2008 of $304,240,000 included $238,789,000 that was based upon
estimates.  Reinsurance premiums receivable as of December 31,
2007 of $244,360,000 included $195,890,000 that was based upon
estimates.  The increase in reinsurance premiums receivable as of
March 31, 2008 as compared with December 31, 2007 was due to an
increase in the premiums written in the first quarter of 2008 as compared to the
fourth quarter of 2007.  An allowance for uncollectible reinsurance
premiums is considered for possible non-payment of such amounts due, as deemed
necessary.  As of March 31, 2008, based on our historical
experience, the general profile of our ceding companies and our ability, in most
cases, to contractually offset reinsurance premiums receivable with losses and
LAE or other amounts payable to the same parties, we did not establish an
allowance for uncollectible reinsurance premiums receivable.
  Gross
unpaid losses and LAE as of March 31, 2008 of $2,410,227,000 included
$1,735,751,000 of estimates of claims that are incurred but not reported
("IBNR").  Gross unpaid losses and LAE as of December 31, 2007 of
$2,361,038,000 included $1,700,454,000 of IBNR.  The increase in
unpaid losses related primarily to the casualty line of business as minor
increases in the property and marine business were offset by declines in unpaid
losses related to finite business.
  Commissions
payable as of March 31, 2008 of $111,908,000 included $92,234,000 that was
based upon premium estimates.  Commissions payable as of
December 31, 2007 of $100,204,000 included $91,035,000 that was based upon
premium estimates.  The increase in commissions payable as of
March 31, 2008 as compared with December 31, 2007 was due to the
increase in premiums written in the first quarter of 2008 as compared to the
fourth quarter of 2007 and is consistent with the increase in reinsurance
premiums receivable.
  We
entered into two derivative contracts during the first quarter of
2008.  The first was an option to purchase retrocessional
protection.  The second was a derivative contract under which we can
recover up to $120,000,000 from the counterparty if modeled losses from both a
first and second catastrophe event exceed a specified attachment
point.  The fair values of these derivatives were adjusted and the
resulting expense of $810,000 was included in other expense in
2008.
   Sources of Liquidity
  Our
consolidated sources of funds consist primarily of premiums written, investment
income, proceeds from sales and redemption of investments, losses recovered from
retrocessionaires, issuance of securities and actual cash and cash equivalents
held by us.  Net cash flows provided by operations, excluding trading
security activities, for the three months ended March 31, 2008 were
$97,280,000.
  Platinum
Holdings is a holding company that conducts no reinsurance operations of its
own.  All of our reinsurance operations are conducted through our
wholly owned reinsurance subsidiaries, Platinum Bermuda and Platinum
US.  As a holding company, the cash flows of Platinum Holdings consist
primarily of interest income, dividends and other permissible payments from its
subsidiaries and issuances of securities.  Platinum Holdings depends
on such payments for general corporate purposes and to meet its obligations,
including the payment of preferred dividends, common dividends and repurchases
of common shares.
  In
addition to the net cash flows generated from operations, we have an effective
universal shelf registration statement whereby we may issue and sell, in one or
more offerings, up to $750,000,000 of debt, equity and other types of securities
or a combination of such securities, including debt securities of Platinum
Finance unconditionally guaranteed by Platinum Holdings.  This shelf
registration statement had approximately $440,000,000 of remaining capacity as
of March 31, 2008.  We also have a $400,000,000 credit facility
with a syndicate of lenders available for revolving borrowings and letters of
credit expiring on September 13, 2011.  The credit facility is
generally available for our working capital, liquidity, letters of credit and
general corporate requirements and those of our subsidiaries.  As of
March 31, 2008 this facility had $317,992,000 of capacity available to
us.
  - 18
-
 Liquidity
Requirements
  Our
principal consolidated cash requirements are the payment of losses and LAE,
commissions, brokerage, operating expenses, dividends to our preferred and
common shareholders, the servicing of debt, capital expenditures, purchase of
retrocessional contracts and payment of taxes.
  Platinum
Bermuda is not licensed, approved or accredited as a reinsurer anywhere in the
United States and, therefore, under the terms of most of its contracts with
United States ceding companies, it is required to provide collateral to its
ceding companies for unpaid ceded liabilities in a form acceptable to state
insurance commissioners.  Typically, this type of collateral takes the
form of letters of credit issued by a bank, the establishment of a trust, or
funds withheld.  Platinum Bermuda provides letters of credit through
the credit facility and may be required to provide the banks with a security
interest in certain investments of Platinum Bermuda including the credit
facility described above.
  We
believe that the net cash flows generated by the operating activities of our
subsidiaries in combination with cash and cash equivalents on hand will provide
sufficient funds to meet our liquidity needs over the next twelve
months.  Beyond the next twelve months, cash flows available to us may
be influenced by a variety of factors, including economic conditions in general
and in the insurance and reinsurance markets, legal and regulatory changes as
well as fluctuations from year to year in claims experience and the occurrence
or absence of large catastrophic events.  If our liquidity needs
accelerate beyond our ability to fund such obligations from current operating
cash flows, we may need to liquidate a portion of our investment portfolio,
borrow under the credit facility described above or raise additional capital in
the capital markets.  Our ability to meet our liquidity needs by
selling investments or raising additional capital is subject to the timing and
pricing risks inherent in the capital markets.
  Capital Resources
  The
Company does not have any material commitments for capital expenditures as of
March 31, 2008.
  Off-Balance Sheet Arrangements
  The
Company does not have any off-balance sheet arrangements and, therefore, there
is no effect on its financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources from these
types of arrangements.
  Contractual
Obligations
  There
have been no material changes to our contractual obligations as disclosed under
Management’s Discussion and Analysis of Financial Condition – Contractual
Obligations in our Annual Report on Form 10-K for the year ended December 31,
2007.
  Economic
Conditions
  Periods
of moderate economic recession or inflation tend not to have a significant
direct effect on our underwriting operations.  Significant unexpected
inflationary or recessionary periods can, however, impact our underwriting
operations and investment portfolio.  Management considers the
potential impact of economic trends in the estimation process for establishing
unpaid losses and LAE.
  Current
Outlook
  During
the period from January 1 through April 1, 2008, approximately 67% of our
business was up for renewal.  We were able to maintain the size of our
net portfolio of reinsurance contracts as new business largely offset cancelled
business. While rate adequacy declined in most classes, we found relatively more
attractive opportunities in our Property and Marine segment and fewer attractive
opportunities in our Casualty and Finite segments.
  For the
Property and Marine segment, during the period from January 1 through April 1,
2008 we experienced average rate decreases of 12% on our U.S. property
catastrophe excess renewal business while rates on our non-U.S. property
catastrophe excess renewal business were down 4%.  In addition, we
experienced average rate decreases of approximately 12% on our marine renewal
business.  Per risk excess rates decreased approximately 5% for our
U.S. business and approximately 3% for our non-U.S. business.
  During
the period from January 1 through April 1, 2008 we increased our writings of
North American crop business from approximately $47 million to approximately
$129 million. Most of this increase was attributable to one large quota share
contract.  While favorable experience in recent years has led to some
deterioration in terms and conditions in this class of business, we believe
there remains an adequate opportunity for profit.  As most of the crop
reinsurance contracts incept at January 1 we do not expect to write a
significant amount of additional crop business for the remainder of
2008.
  During
the period from January 1 through April 1, 2008 we wrote approximately 15% less
U.S. catastrophe excess-of-loss premium than we did during the same period in
2007.  However, due to the rate decreases in this class of business,
our net retained risk has remained at the same level for 2008 while our
potential profit has decreased.  We believe the profitability remains
adequate for the risk and for 2008 we plan to deploy capacity such that up to
approximately 22.5% of our total capital could be exposed to an event with a
probability of 1 in 250 years.
  The lack
of significant catastrophe activity in 2007 contributed to excellent financial
results, stronger balance sheets and increased capacity for many reinsurers.
Though many reinsurers have implemented capital management programs, we believe
the net effect has been increased industry capacity.  This has led to
intensified competition and rate decreases in 2008.  We believe that
most classes within the Property and Marine segment will continue to experience
some rate deterioration for the remainder of 2008.
  For the
Casualty segment, although we believe that the market offers adequate returns on
certain accounts, pricing has been softening.  Ceding companies are
willing to increase retentions and reinsurers are competing for participation on
the best contracts.  During the period from January 1 though
April 1, 2008 rate decreases across our casualty business, other than
accident and health, have ranged from approximately 1% to 11%.  The
overall average was a decrease of approximately 7%, against a background of
upward trending loss costs.  As a result, we believe the business
underwritten in 2008 will have a lower level of expected profitability as
compared with the business underwritten in 2007.
  - 19
-
 During
the period January1 through April 1, 2008 we wrote approximately 18% less
casualty business than we did during the same period in 2007.  We
expect market conditions will continue to weaken through the remainder of 2008
and that fewer casualty opportunities will be attractive.  We believe
that financial security remains a significant concern for buyers of long-tailed
reinsurance protection who typically seek reinsurers with strong balance sheets,
quality ratings, and a proven claims-paying record.  We believe that
our rating, capitalization and reputation as a lead casualty reinsurer position
us well to write profitable business as opportunities arise.
  In the
Finite Risk segment, we believe that the ongoing investigations by the SEC, the
office of the Attorney General for the State of New York, the U.S. Attorney for
the Southern District of New York as well as various non-U.S. regulatory
authorities continue to limit demand for finite risk transfer
products.  We expect the relatively low level of demand will continue
for the foreseeable future.
  Critical Accounting
Estimates
  It is
important to understand our accounting estimates in order to understand our
financial position and results of operations.  We consider certain of
these estimates to be critical to the presentation of the financial results
since they require management to make estimates and valuation
assumptions.  These estimates and assumptions affect the reported
amounts of assets, liabilities, revenues, expenses and related
disclosures.  Certain of the estimates and assumptions result from
judgments that are necessarily subjective and, consequently, actual results may
materially differ from these estimates.  Our critical accounting
estimates include premiums written and earned, unpaid losses and LAE, valuation
of investments and evaluation of risk transfer.  For a detailed
discussion of the Company’s critical accounting estimates please refer to
Management’s Discussion and Analysis of Financial Condition and Results of
Operations included in our Annual Report on Form 10-K for the year ended
December 31, 2007.  There have been no material changes in the
application of the Company’s critical accounting estimates subsequent to
December 31, 2007.
  ITEM
      3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
    RISK
  Market and Credit
Risk
  During
the quarter, the fair values of our fixed maturity securities experienced
significant volatility resulting in large changes in our unrealized gain and
loss position at any particular point in time due to a combination of economic
events.  The contagion from the sub-prime residential mortgage market
was evident in most other fixed income sectors as illiquidity in the market
place continued and interest rate spreads reached historical levels against U.S.
treasuries, most notably spreads on mortgage-backed and asset-backed
securities.  The Federal Reserve in the United States reduced the
federal funds target rate by 200 basis points during the first quarter and
intervened with non-traditional measures to enhance and promote market liquidity
and ensure financial market stability.
  Our
principal invested assets are fixed maturity securities, which are subject to
the risk of potential losses from adverse changes in market rates and prices and
credit risk resulting from adverse changes in the borrower's ability to meet its
debt service obligations.  Our strategy to limit this risk is to place
our investments in high quality credit issues and to limit the amount of credit
exposure with respect to any one issuer or asset class.  We also
select investments with characteristics such as duration, yield, currency and
liquidity to reflect, in the aggregate, the underlying characteristics of our
unpaid losses and LAE.  We attempt to minimize the credit risk by
actively monitoring the portfolio and establishing a guideline minimum average
credit rating for our portfolio of A2 as defined by Moody's Investor Service
("Moody’s").  As of March 31, 2008, the portfolio, excluding
cash, cash equivalents and short-term investments, had a dollar weighted average
credit rating of Aa1 as defined by Moody’s.
  We have
other receivable amounts subject to credit risk.  The most significant
of these are reinsurance premiums receivable from ceding
companies.  We also have reinsurance recoverable amounts from our
retrocessionaires.  To mitigate credit risk related to premiums
receivable, we have established standards for ceding companies and, in most
cases, have a contractual right of offset which would allow us to settle claims
net of any premiums receivable.  To mitigate credit risk related to
our reinsurance recoverable amounts, we consider the financial strength of our
retrocessionaires when determining whether to purchase coverage from
them.  Retrocessional coverage is obtained from companies rated “A-”
or better by A. M. Best Company, Inc. ("A.M. Best") or from
retrocessionaires whose obligations are fully collateralized.  The
financial performance and rating status of all material retrocessionaires is
routinely monitored.
  In
accordance with industry practice, we frequently pay amounts in respect of
claims under contracts to reinsurance brokers for payment over to the ceding
companies.  In the event that a broker fails to make such a payment,
depending on the jurisdiction, we may remain liable to the ceding company for
the payment.  Conversely, in certain jurisdictions, when ceding
companies remit premiums to reinsurance brokers, such premiums are deemed to
have been paid to us and the ceding company is no longer liable to us for those
amounts whether or not the funds are actually received by
us.  Consequently, we assume a degree of credit risk associated with
our brokers during the premium and loss settlement process.  To
mitigate credit risk related to reinsurance brokers, we have established
guidelines for brokers and intermediaries.
  Interest Rate
Risk
  We are
exposed to fluctuations in interest rates.  Movements in rates can
result in changes in the market value of our fixed maturity portfolio and can
cause changes in the actual timing of receipt of principal payments of certain
securities.  Rising interest rates result in a decrease in the market
value of our fixed maturity portfolio and can expose our portfolio, in
particular our mortgage-backed securities, to extension
risk.  Conversely, a decrease in interest rates will result in an
increase in the market value of our fixed maturity portfolio and can expose our
portfolio, in particular our mortgage-backed securities, to prepayment
risk.  An aggregate hypothetical impact on the market value of our
fixed maturity portfolio, generated from an immediate parallel shift in the
treasury yield curve, as of March 31, 2008 is as follows ($ in
thousands):
  Interest
      Rate Shift in Basis Points-
      100 bp
              
              
              -
      50 bp
              
              
              Current
              
              
              +
      50 bp
              
              
              
              +
      100 bpTotal
      market value
              
              $
              3,363,291
              
              
              3,260,467
              
              
              3,205,200
              
              
              3,151,745
              
              
              $
              3,095,661Percent
      change in market value
              
              
              4.9
              %
              
              1.7
              %
              
              
              
              
              (1.7
              %)
              
              
              (3.4
              %)Resulting
      unrealized appreciation / (depreciation)
              
              $
              134,836
              
              
              32,012
              
              
              (23,255
              )
              
              (76,710
              )
              
              $
              (132,794
              )
  - 20
-
 Foreign Currency Exchange
Rate Risk
  We write
business on a worldwide basis.  Consequently, our principal exposure
to foreign currency risk is the transaction of business in foreign
currencies.  Changes in foreign currency exchange rates can impact
revenues, costs, receivables and liabilities, as measured in the U.S. dollar,
our financial reporting currency.  We manage our exposure to large
foreign currency risks by holding invested assets denominated in non-U.S. dollar
currencies to offset liabilities denominated in the same foreign
currencies.  We may from time to time hold more non-U.S. dollar
denominated assets than non-U.S. dollar liabilities.
  Sources of Fair
Value
  The
following table presents the carrying amounts and estimated fair values of our
financial instruments as of March 31, 2008 ($ in thousands):
  Carrying
                Amount
              
              
              Fair
      ValueFinancial
      assets:Fixed
      maturity securities
              
              $
              3,205,200
              
              
              $
              3,205,200Preferred
      stocks
              
              
              10,066
              
              
              
              10,066Short-term
      investments
              
              
              135,418
              
              
              
              135,418Derivative
      instruments
              
              
              5,950
              
              
              
              5,950Financial
      liabilities:Debt
      obligations
              
              $
              250,000
              
              
              $
              249,750
 
 The fair
value of our fixed maturity securities, preferred stocks, short-term investments
and debt obligations are based on prices obtained from independent sources for
those or similar investments using quoted prices in active markets and standard
market valuation pricing models.  The inputs used in standard market
valuation pricing models may include but are not limited to: credit ratings,
interest rates and yield curves at commonly quoted intervals, volatilities,
prepayment speeds, loss severities, credit risks and default
rates.  Our derivative instruments, which are included in other assets
in the consolidated balance sheet, are priced at fair value using unobservable
inputs through the application of our own assumptions and internal valuation
pricing models.
  Item
      4. CONTROLS AND PROCEDURES
  Disclosure Controls and
Procedures
  Our
management, including the Chief Executive Officer and Chief Financial Officer,
carried out an evaluation of the effectiveness of our disclosure controls and
procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934 (the "Exchange Act")) as of the end of the
period covered by this report.  Based on that evaluation, our
management, including the Chief Executive Officer and Chief Financial Officer,
concluded that our disclosure controls and procedures are effective to provide
reasonable assurance that information required to be disclosed by us in reports
that we file or submit under the Exchange Act is recorded, processed, summarized
and timely reported as specified in the SEC’s rules and forms.
  Changes in Internal Control
over Financial Reporting
  No
changes occurred during the quarter ended March 31, 2008 in our internal
control over financial reporting that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
  Forward-Looking
Statements
  This Form
10-Q contains forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Exchange
Act.  Forward-looking statements are necessarily based on estimates
and assumptions that are inherently subject to significant business, economic
and competitive uncertainties and contingencies, many of which are subject to
change.  These uncertainties and contingencies can affect actual
results and could cause actual results to differ materially from those expressed
in any forward-looking statements made by, or on behalf of, us.
  In
particular, statements using words such as “may,” “should,” “estimate,”
“expect,” “anticipate,” “intend,” “believe,” “predict,” “potential,” or words of
similar import generally involve forward-looking statements.  For
example, we have included certain forward-looking statements in “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” with
regard to trends in results, prices, volumes, operations, investment results,
margins, risk management and exchange rates.  This Form 10-Q also
contains forward-looking statements with respect to our business and industry,
such as those relating to our strategy and management objectives and trends in
market conditions, market standing, product volumes, investment results and
pricing conditions.
  In light of
the risks and uncertainties inherent in all future projections, the inclusion of
forward-looking statements in this Form 10-Q 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 forward-looking statements, including the
following:
  (1)
              significant
      weather-related or other natural or man-made disasters over which we have
      no control;
  (2)
              the
      effectiveness of our loss limitation methods and pricing
      models;
  (3)
              the
      adequacy of our liability for unpaid losses and
  LAE;
  (4)
              our
      ability to maintain our A.M. Best.
rating;
  (5)
              the
      cyclicality of the property and casualty reinsurance
    business;
  (6)
              conducting
      operations in a competitive
environment;
  - 21
-
  (7)
              our
      ability to maintain our business relationships with reinsurance
      brokers;
  (8)
              the
      availability of retrocessional reinsurance on acceptable
      terms;
  (9)
              market
      volatility, interest rate and currency exchange rate fluctuation, and
      credit risk on invested assets;
  (10)
              tax,
      regulatory or legal restrictions or limitations applicable to us or the
      property and casualty reinsurance business
  generally;
  (11)
              general
      political and economic conditions, including the effects of civil unrest,
      acts of terrorism, war or a prolonged U.S. or global economic downturn or
      recession; and
  (12)
              changes
      in our plans, strategies, objectives, expectations or intentions, which
      may happen at any time at our
discretion.
 
 As a
consequence, current plans, anticipated actions and future financial condition
and results may differ from those expressed in any forward-looking statements
made by or on behalf of us.  The foregoing factors, which are
discussed in more detail in Item 1A – “Risk Factors” in our Annual Report on
Form 10-K for the year ended December 31, 2007, should not be construed as
exhaustive.  Additionally, forward-looking statements speak only as of
the date they are made, and we undertake no obligation to release publicly the
results of any future revisions or updates we may make to forward-looking
statements to reflect new information or circumstances after the date hereof or
to reflect the occurrence of future events.
  PART
II – OTHER INFORMATION
  Item
      2.
              UNREGISTERED
      SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS
  (c)           Following
is a summary of purchases by us of our common shares during the quarterly period
ended March 31, 2008:
  Period
              
              (a)
                Total
      Number of Shares Purchased
              
              
              (b)
                Average
      Price paid per Share
              
              
              (c)
                Total
      Number of Shares Purchased as Part of Publicly Announced Plans or Programs
      *
              
              
              (d)
                Maximum
      Dollar Value of Shares that May Yet Be Purchased Under the Plans or
      ProgramsJanuary
      1, 2008 – January 31, 2008
              
              
              1,162,892
              
              
              $
              35.43
              
              
              
              1,162,892
              
              
              $
              85,063,000February
      1, 2008 – February 29, 2008
              
              
              1,009,500
              
              
              
              34.77
              
              
              
              1,009,500
              
              
              
              214,873,852March
      1, 2008 – March 31, 2008
              
              
              2,754,600
              
              
              
              33.22
              
              
              
              2,754,600
              
              
              
              123,296,579Total
              
              
              4,926,992
              
              
              $
              34.06
              
              
              
              4,926,992
              
              
              $
              123,296,579
 
 *
              On
      August 4, 2004 our Board of Directors established a program to
      repurchase our common shares.  On July 26, 2007 our Board of
      Directors approved an increase in the then existing repurchase program to
      result in authority as of such date to repurchase up to a total of
      $250,000,000 of our common shares.  After repurchases of our
      common shares, on each of October 25, 2007, February 21, 2008 and April
      23, 2008 our Board of Directors approved additional increases in the
      repurchase program to result in authority as of such dates to repurchase
      up to a total of $250,000,000 of our common shares.  During the
      three months ended March 31, 2008, the Company repurchased 4,926,992
      of its common shares in the open market at an aggregate cost of
      $167,941,000 and a weighted average cost of $34.09 per
      share.  The common shares we repurchased were
      canceled.
   Item
      6. EXHIBITS
  Exhibit
      Number
              
              Description10.1
              
              Letter
      Agreement dated March 3, 2008 between the Company, Steven H. Newman, SHN
      Enterprises, Inc. and Platinum US, and exhibits thereto. (1)10.2
              
              Assignment
      of Amended and Restated Option Agreement, effective as of April 1, 2008,
      among the Company, The Travelers Companies, Inc. and Unionamerica
      Insurance Company Limited.10.3
              
              Termination
      Addendum, effective December 31, 2007, to Casualty and Specialty Quota
      Share Retrocession Agreement dated as of January 1, 2007 by and between
      Platinum US and Platinum Bermuda.31.1
              
              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 James A. Krantz, 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 James A. Krantz, 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.
 
 (1)
              Incorporated
      by reference from the Company’s Current Report on Form 8-K filed with the
      SEC on March 4, 2008.
   - 22
-
 
 SIGNATURES
  Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
 
 Platinum
      Underwriters Holdings, Ltd.
 
 Date:
      April 29, 2008
              /s/  MICHAEL
      D. PRICEBy:
      Michael D. PricePresident
      and Chief Executive Officer
                (Principal
      Executive Officer)
 
 Date:
      April 29, 2008
              /s/  JAMES
      A. KRANTZBy:
      James A. KrantzExecutive
      Vice President and Chief Financial Officer
                (Principal
      Financial and Accounting
Officer)











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