<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     FOR THE QUARTERLY PERIOD ENDED: SEPTEMBER 30, 1998

                                       OR

[X]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

     FOR THE TRANSITION PERIOD FROM                 TO                    
                                    ---------------    -----------------

     COMMISSION FILE NUMBER: 0-27662

                               IPC HOLDINGS, LTD.
             (Exact name of registrant as specified in its charter)

                 BERMUDA                             NOT APPLICABLE
      ------------------------------               -------------------
     (State or other jurisdiction of                (I.R.S. Employer
      incorporation or organization)               Identification No.)

   AMERICAN INTERNATIONAL BUILDING, 29 RICHMOND ROAD, PEMBROKE, HM 08, BERMUDA
-------------------------------------------------------------------------------
                    (Address of principal executive offices)


                                 (441) 298-5100
                                 --------------
              (Registrant's telephone number, including area code)


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

The number of outstanding common shares par value U.S. $0.01 per share of IPC
Holdings, Ltd., as of November 9, 1998, was 25,033,932.


                                 TOTAL PAGES 16
                        EXHIBIT INDEX LOCATED ON PAGE 14


                                       1
<PAGE>   2
                             PART I. FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                       IPC HOLDINGS, LTD. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of United States dollars, except for per share amounts)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                           As of                As of
                                                                      September 30, 1998   December 31, 1997
                                                                         (unaudited)          (audited)
                                                                          --------            --------
<S>                                                                    <C>                 <C>
ASSETS:

Fixed maturity investments:
   Available for sale, at fair market value (Amortized
     cost 1998: $488,345; 1997: $438,669)                                 $501,638            $442,328
Equity investments, available for sale (Cost 1998: $68,766;
     1997: $80,020)                                                         77,557              86,685
Cash and cash equivalents                                                   12,912               9,746
Reinsurance balances receivable (Related party 1998:
   $4,064; 1997: $6,583)                                                    35,921              27,723
Funds withheld                                                               2,422                  12

Accrued investment income                                                   13,772              14,374
Deferred acquisition costs                                                   5,052               2,593
Prepaid expenses and other assets                                            2,565               1,558
                                                                          --------            --------
           Total assets                                                   $651,839            $585,019
                                                                          ========            ========

LIABILITIES:

Reserve for losses and loss adjustment expenses                           $ 43,218            $ 27,590
Unearned premiums                                                           43,069              26,462
Accounts payable and accrued liabilities (Related party
   1998: $839; 1997: $1,243)                                                 6,214               2,674
                                                                          --------            --------
           Total liabilities                                                92,501              56,726
                                                                          --------            --------

SHAREHOLDERS' EQUITY:

Share capital (Common shares outstanding, par value U.S.$0.01:
1998: 25,033,932; 1997: 25,017,103 shares)                                     250                 250
Additional paid-in capital                                                 299,833             299,533
Unrealized gain (loss), net on investments                                  22,084               9,476
Retained earnings                                                          237,171             219,034
                                                                          --------            --------
           Total shareholders' equity                                      559,338             528,293
                                                                          --------            --------
           Total liabilities and shareholders' equity                     $651,839            $585,019
                                                                          ========            ========
</TABLE>


           See accompanying Notes to Consolidated Financial Statements


                                       2
<PAGE>   3
                       IPC HOLDINGS, LTD. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME

(Expressed in thousands of United States dollars, except for per share amounts)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                       Quarter Ended September 30,               Nine Months Ended  September 30,
                                                   ----------------------------------           -----------------------------------
                                                        1998                  1997                   1998                   1997
                                                   ------------          ------------           ------------           ------------
                                                    (unaudited)           (unaudited)            (unaudited)            (unaudited)
<S>                                                <C>                   <C>                    <C>                    <C>
REVENUES:

Premiums written                                   $     15,671          $     21,721           $    106,242           $    111,295
Change in unearned premiums                              13,756                 6,838                (16,607)               (27,008)
                                                   ------------          ------------           ------------           ------------
Premiums earned                                          29,427                28,559                 89,635                 84,287
Net investment income                                     7,726                 7,091                 22,438                 22,694
Realized gains (losses), net on investments                 342                (1,314)                 4,030                 (3,490)
                                                   ------------          ------------           ------------           ------------
Total revenues                                           37,495                34,336                116,103                103,491
                                                   ------------          ------------           ------------           ------------

EXPENSES:

Losses and loss adjustment expenses                      18,922                 2,857                 33,379                  8,039
Acquisition costs                                         4,212                 3,387                 12,248                  9,336
General and administrative expenses                       2,960                 1,980                  7,922                  6,026
Exchange (gain) loss, net                                   340                   578                    545                  1,516
                                                   ------------          ------------           ------------           ------------
Total expenses                                           26,434                 8,802                 54,094                 24,917
                                                   ------------          ------------           ------------           ------------
Net income                                         $     11,061          $     25,534           $     62,009           $     78,574
                                                   ============          ============           ============           ============

Basic net income per common share                  $       0.44          $       1.02           $       2.48           $       3.14
Diluted net income per common share                $       0.42          $       0.96           $       2.33           $       2.97

Weighted average number of shares - basic            25,033,932            25,017,103             25,030,303             25,007,601
Weighted average number of shares - diluted          26,474,892            26,597,466             26,625,544             26,432,851
</TABLE>


           See accompanying Notes to Consolidated Financial Statements


                                       3
<PAGE>   4
                       IPC HOLDINGS, LTD. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                (Expressed in thousands of United States dollars)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                 Nine months ended September 30,
                                                                 -------------------------------
                                                                    1998                1997
                                                                 ---------           ---------
                                                                (unaudited)          (unaudited)
<S>                                                             <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

Net income                                                       $  62,009           $  78,574
Adjustments to reconcile net income to cash provided
   by operating activities:
   Amortization of investment premium, net                             663               1,352
   Realized (gains) losses, net on investments                      (4,030)              3,490
   Changes in, net:
     Reinsurance balances receivable                                (8,198)            (16,885)
     Funds withheld                                                 (2,410)               (792)
     Accrued investment income                                         602               2,574
     Deferred acquisition costs                                     (2,459)             (2,531)
     Prepaid expenses and other assets                              (1,007)               (970)
     Reserve for losses and loss adjustment expenses                15,628              (1,006)
     Unearned premiums                                              16,607              27,008
     Accounts payable and accrued liabilities                        3,540                 828
                                                                 ---------           ---------
                                                                    80,945              91,642
                                                                 ---------           ---------
CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of equity investments                                     (2,204)            (79,564)
Proceeds from sales of equities                                     16,621                  22
Purchases of fixed maturity investments:
   Available for sale                                             (227,041)           (307,277)
   Held to maturity                                                      0             (17,814)
Proceeds from sales of fixed maturity investments:
   Available for sale                                              170,417             304,009
   Held to maturity                                                      0                   0
Proceeds from maturities of fixed maturity investments:
   Available for sale                                                8,000              28,600
   Held to maturity                                                      0              23,750
                                                                 ---------           ---------
                                                                   (34,207)            (48,274)
                                                                 ---------           ---------
CASH FLOWS FROM FINANCING ACTIVITIES:

Additional share capital                                               300                 258
Cash dividends paid to shareholders                                (43,872)            (48,841)
                                                                 ---------           ---------
                                                                   (43,572)            (48,583)
                                                                 ---------           ---------
Net increase (decrease) in cash and cash equivalents                 3,166              (5,215)
Cash and cash equivalents, beginning of period                       9,746              23,797
                                                                 ---------           ---------
Cash and cash equivalents, end of period                         $  12,912           $  18,582
                                                                 =========           =========
</TABLE>


           See accompanying Notes to Consolidated Financial Statements


                                       4
<PAGE>   5
                       IPC HOLDINGS, LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 (Expressed in thousands of United States dollars, except for per share amounts)
                                   (unaudited)

--------------------------------------------------------------------------------

1. GENERAL:

   The consolidated interim financial statements presented herein have been
   prepared on the basis of United States generally accepted accounting
   principles ("GAAP") and include the accounts of IPC Holdings, Ltd. (the
   "Company"), and its wholly owned subsidiaries, IPCRe Limited ("IPCRe") and
   IPC Re Services Limited ("Services" and, together with the Company and IPCRe,
   "IPC"). In the opinion of management, these financial statements reflect all
   adjustments (consisting of normal recurring accruals) necessary for a fair
   presentation of the results of operations for the three and nine month
   periods ended September 30, 1998 and 1997, respectively, the balance sheet at
   September 30, 1998 and the cash flows for the nine month periods ended
   September 30, 1998 and 1997, respectively. These interim consolidated
   financial statements should be read in conjunction with the audited
   consolidated financial statements for the year ended December 31, 1997. The
   results of operations for any interim period are not necessarily indicative
   of results for the full year.

2. DIVIDENDS:

   On February 28, 1998, the Directors declared a quarterly dividend of $0.3175
   per share, and a special dividend of $0.80 per share, payable to shareholders
   of record on March 10, 1998. Such dividends were paid March 26, 1998.

   On April 28, 1998, the Directors declared a quarterly dividend of $0.3175 per
   share, payable to shareholders of record on June 9, 1998. Such dividends were
   paid on June 25, 1998.

   On July 28, 1998, the Directors declared a quarterly dividend of $0.3175 per
   share payable to shareholders of record on September 8, 1998. Such dividends
   were paid on September 24, 1998.

   On October 23, 1998, the Directors declared a quarterly dividend of $0.3175
   per share payable on December 17, 1998, to shareholders of record on December
   1, 1998.


3. NET INCOME PER SHARE:

   The Company has adopted Statement of Financial Accounting Standards No. 128,
   "Earnings per Share", which requires dual presentation of basic and diluted
   earnings per share. Diluted net income per common share is computed by
   dividing net income by the weighted average number of shares of common stock
   and common stock equivalents outstanding during the year. Stock options
   granted to a shareholder of the Company were considered common stock
   equivalents and were included in the number of weighted average shares
   outstanding using the treasury stock method. Stock options granted to
   employees on February 15, 1996, July 25, 1996, January 2, 1997 and January 2,
   1998 were also considered common stock equivalents for the purpose of
   calculating diluted net income per common share.


                                       5
<PAGE>   6
4. COMPREHENSIVE INCOME

   In June, 1997 the Financial Accounting Standards Board issued Statement of
   Financial Accounting Standard No. 130, "Comprehensive Income" ("SFAS 130"),
   which is effective for financial statements issued for periods beginning
   after December 15, 1997. SFAS 130 requires the disclosure of all components
   of comprehensive income, including net income and other comprehensive income.
   For the three and nine month periods ended September 30, 1998 and September
   30, 1997, respectively, comprehensive income is calculated as follows:

<TABLE>
<CAPTION>
                                                                          Quarter ended                     Nine months ended
                                                                          -------------                     -----------------
                                                                           September 30,                     September 30,
                                                                           -------------                     -------------
                                                                      1998              1997              1998              1997
                                                                    --------           -------          --------           -------
<S>                                                                 <C>                <C>              <C>                <C>
Net income                                                          $ 11,061           $25,534          $ 62,009           $78,574
Other comprehensive income
    Holding gains/(losses), net on investments during period           1,488             9,520            16,638             6,586
    Reclassification adjustment for (gains)/losses included in          (342)            1,314            (4,030)            3,490
       net income
                                                                    --------           -------          --------           -------
                                                                       1,146            10,834            12,608            10,076
                                                                    --------           -------          --------           -------
Comprehensive income                                                  12,207            36,368            74,617            88,650
                                                                    ========           =======          ========           =======
</TABLE>

5. ACCOUNTING FOR DERIVATIVES

   The Financial Accounting Standards Board has also recently issued Statement
   of Financial Accounting Standard No. 133, "Accounting for Derivative
   Instruments and Hedging Activities," ("SFAS 133") which is effective for
   periods beginning after June 15, 1999. Management does not expect the impact
   of the adoption of SFAS 133 on the Company's financial position or results to
   be material.


6. DEPOSIT ACCOUNTING

   In October, 1998 the American Institute of Certified Public Accountants
   ("AICPA") issued Statement of Position 98-7, "Accounting for Insurance and
   Reinsurance Contracts that do not Transfer Insurance Risk", which is 
   effective for fiscal years beginning after June 15, 1999. IPCRe does not 
   currently write or cede business which would be affected by this Statement.


                                       6
<PAGE>   7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS


   RESULTS OF OPERATIONS, QUARTERS ENDED SEPTEMBER 30, 1998 AND 1997

   In the quarters ended September 30, 1998 and 1997, IPCRe wrote premiums of
   $15.7 million and $21.7 million, respectively, a decrease of 27.8%. Written
   premiums were impacted by rate reductions in the period, generally in the
   range of 15% but as high as 20% in some cases, the non-renewal of some
   contracts by IPCRe, as well as the effect of declining exchange rates in
   Pacific Rim countries. In addition, third quarter writings were impacted by
   the restructuring of a major client account, where the inception date changed
   from July 1 to June 1. These reductions were partially offset by increased
   signings and additional business from existing clients over the same period
   of 1997, and selectively written business for new clients. Premiums were also
   boosted by reinstatement premiums from increased claim activity. Premiums
   earned in the three months ended September 30, 1998 were $29.4 million,
   compared to $28.6 million in the same period in 1997, an increase of 3.0%.
   Reinstatement premiums are fully earned when written, and account for the
   majority of the increase.

   Net investment income was $7.7 million in the quarter ended September 30,
   1998, compared to $7.1 million for the quarter ended September 30, 1997, an
   increase of 9.0%. The increase arises from the average amount of invested 
   assets being 8.6% higher.

   There was a net realized gain from the sale of investments in the quarter
   ended September 30, 1998 of $0.3 million, compared to a net loss in the same
   period of 1997 of $1.3 million. Net realized gains and losses fluctuate from
   period to period, depending on the individual securities sold, as recommended
   by IPCRe's investment advisor. The portfolio restructuring that took place in
   June and July of 1997 resulted in the majority of the realized loss in that
   period.

   In the three months ended September 30, 1998, incurred losses were $18.9
   million, compared to $2.9 million in the corresponding period of 1997. Claim
   activity in the three months ended September 30, 1998 included Hurricane
   Georges, for which IPCRe established a total provision of $9.0 million, a
   cyclone in India, for which $1.0 million is provided, a frequency of events
   during 1998 such that deductibles for aggregate covers have been exhausted,
   the failure of two satellites, and development of claims from the Canadian
   icestorms earlier in the year, as well as development for current and prior
   year marine and aviation business. IPC's loss and loss expense ratio (the
   ratio of losses and loss adjustment expenses to premiums earned) was 64.3% in
   the third quarter of 1998 compared to 10.0% in the corresponding period last
   year.

   Acquisition costs incurred, which consist primarily of commissions and
   brokerage fees paid to intermediaries for the production of business, were
   $4.2 million for the quarter ended September 30, 1998, compared to $3.4
   million in the same period of 1997. Certain contracts have been written with
   profit commission clauses, which return a portion of the net underwriting
   profits generated from those contracts as a commission to the insureds. This
   has resulted in an increase in the level of acquisition cost as a percentage
   of premiums earned. General and administrative expenses were $3.0 million in
   the quarter ended September 30, 1998, compared to the $2.0 million incurred
   in the corresponding period in 1997. The reasons for the increase were the
   upfront costs of closing a $300 million standby credit facility, provided by
   a syndicate of banks led by First Chicago, increased legal fees, and
   increased costs relating to the implementation of new computer software.
   IPC's expense ratio (the ratio of acquisition costs plus general and
   administrative expenses to premiums earned) was 24.4% for the quarter ended
   September 30, 1998 compared to 18.8% for the corresponding period in 1997.

   The following table summarizes the loss and loss expense ratio, expense ratio
   and combined ratio (sum of loss and loss expense ratio, plus expense ratio)
   for the quarters ended September 30, 1998 and 1997, respectively:

<TABLE>
<CAPTION>
                                             Quarter ended September 30,
                                             ---------------------------
                                               1998            1997
                                               ----            ----
<S>                                            <C>             <C>
   Loss & loss expense ratio                   64.3%           10.0%
   Expense ratio                               24.4%           18.8%
   Combined ratio                              88.7%           28.8%
</TABLE>

   Net income for the quarter ended September 30, 1998 was $11.1 million,
   compared to $25.5 million for the corresponding period in 1997, a decrease of
   56.7%. Excluding the effects of net realized gains and losses arising from
   the sale of investments, net operating income for the third quarter of 1998
   was $10.7 million, compared to $26.8 million for the third quarter of 1997, a
   decrease of 60.1%. The decrease is a result of the increases in claims and
   expenses, as discussed above.


                                       7
<PAGE>   8
   RESULTS OF OPERATIONS, NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997

   In the nine months ended September 30, 1998 and 1997, IPCRe wrote premiums of
   $106.2 million and $111.3 million, respectively, a decrease of 4.5%. During
   the first nine months of 1998, IPCRe had increased signings and additional
   business from existing clients, and selectively wrote business for new
   clients. Also, reinstatement premiums from increased claim activity helped
   boost writings. The premium increases were more than offset by rate
   reductions in the period, generally in the range of 15% but as high as 20% in
   some cases, the non-renewal of some contracts by IPCRe, as well as the effect
   of declining exchange rates in Pacific Rim countries. Premiums earned in the
   nine months ended September 30, 1998 were $89.6 million, compared to $84.3
   million in the same period in 1997, an increase of 6.3%. Reinstatement
   premiums are fully earned when written, and account for the majority of the
   increase.

   Net investment income was $22.4 million in the nine months ended September
   30, 1998, compared to $22.7 million for the nine months ended September 30,
   1997, a decrease of 1.1%. The average yield of the overall portfolio has
   declined from 5.7% in the first nine months of 1997, to 5.3% in the first
   nine months of 1998. This reduction reflects the portfolio restructuring that
   took place in the second quarter of 1997, whereby part of the portfolio was
   invested in equities, and has offset gains from the growth in the average
   amount of invested assets, which was 7.1% higher in the first nine months of
   1998 compared to the corresponding period in 1997. The yield on the fixed
   maturity element of the portfolio is currently 6.0%, which is comparable to
   the yield earned in prior periods.

   There was a net realized gain from the sale of investments in the nine months
   ended September 30, 1998 of $4.0 million, compared to a net loss in the same
   period of 1997 of $3.5 million. Net realized gains and losses fluctuate from
   period to period, depending on the individual securities sold, as recommended
   by IPCRe's investment advisor. The portfolio restructuring that took place at
   the end of the second quarter of 1997 resulted in the majority of the
   realized loss last year.

   In the nine months ended September 30, 1998, incurred losses were $33.4
   million, compared to $8.0 million in the corresponding period of 1997. Claim
   activity in the nine months ended September 30, 1998 included the icestorms
   in the U.S. and Canada in January, windstorms in the U.S. during the second
   and third quarters, floods in the U.K. in April, Hurricane Georges which 
   produced significant claims from Puerto Rico, a typhoon in Korea, a
   cyclone in India, and the failure of two satellites, as well as development
   of claims for current and prior year marine and aviation business. There were
   also some additional claims from the 1997 accident year, including a late
   reported loss from a major refinery explosion in Malaysia, which took place
   on December 25, 1997. IPC's loss and loss expense ratio was 37.2% in the 
   first nine months of 1998 compared to 9.5% in the corresponding period of 
   1997.

   Acquisition costs incurred were $12.2 million for the nine months ended
   September 30, 1998, compared to $9.3 million in the same period of 1997.
   Certain contracts have been written with profit commission clauses, which
   return a portion of the net underwriting profits generated from those
   contracts as a commission to the insureds. This has resulted in an increase
   in the level of acquisition cost as a percentage of premiums earned. General
   and administrative expenses were $7.9 million in the nine months ended
   September 30, 1998, compared to the $6.0 million incurred in the
   corresponding period in 1997. This growth is due primarily to an increase in
   the amount of salaries and benefits paid to employees, including an accrual
   of deferred compensation expense for executives, the upfront costs of IPCRe's
   $300.0 million standby credit facility with a syndicate of banks led by First
   Chicago, increased legal fees, and increased costs relating to the
   implementation of new computer software, as well as fees based on earned
   premiums, which are paid under the administrative services agreement. IPC's
   expense ratio was 22.5% for the nine months ended September 30, 1998 compared
   to 18.2% for the corresponding period in 1997.

   The following table summarizes the loss and loss expense ratio, expense ratio
   and combined ratio for the nine months ended September 30, 1998 and 1997,
   respectively:

<TABLE>
<CAPTION>
                                           Nine months ended September 30,
                                           -------------------------------
                                               1998            1997
                                               ----            ----
<S>                                           <C>              <C>
   Loss & loss expense ratio                   37.2%            9.5%
   Expense ratio                               22.5%           18.2%
   Combined ratio                              59.7%           27.7%
</TABLE>

   Net income for the nine months ended September 30, 1998 was $62.0 million,
   compared to $78.6 million for the corresponding period in 1997, a decrease of
   21.1%. Excluding the effects of net realized gains and losses arising from
   the sale of investments, net operating income for the first nine months of
   1998 was $58.0 million, compared to $82.1 million for the corresponding
   period of 1997, a decrease of 29.3%. The decrease is a result of the
   increases in claims and expenses, as discussed above.


                                       8
<PAGE>   9
LIQUIDITY AND CAPITAL RESOURCES

The Company's cash flows are limited to distributions from IPCRe and Services
by way of loans or dividends. The dividends that IPCRe may pay are limited
under Bermuda legislation. The Bermuda Insurance Act of 1978 and subsequent
amendments thereto require IPCRe to maintain a minimum solvency margin and a
minimum liquidity ratio. The maximum dividend payable by IPCRe in accordance
with these restrictions as of January 1, 1998 was approximately $131 million.

IPCRe's sources of funds consist of premiums written, investment income and
proceeds from sales and redemptions of investments. Cash is used primarily to
pay losses and loss adjustment expenses, brokerage commissions, excise taxes,
general and administrative expenses and dividends. The potential for a large
catastrophe means that unpredictable and substantial payments may need to be
made within relatively short periods of time. Hence the Company's cash flows
may fluctuate significantly from period to period.

Cash flows from operating activities in the first nine months of 1998 were
$80.9 million compared to $91.6 million in the first nine months of 1997,
which represents a decrease of 11.7%. The decrease arises primarily from the
reduction in operating income, as noted above.

Net cash flows used in investing activities in the first nine months of 1998
were $34.2 million. In addition, a total of $43.9 million were paid to
shareholders in dividends on March 26, 1998, June 25, 1998 and September 24,
1998, respectively. Cash and cash equivalents increased by $3.2 million in
the nine months, resulting in a balance of $12.9 million at September 30,
1998. At September 30, 1998, 49% of IPC's fixed maturity portfolio (based on
market value) was held in cash, United States Treasury notes and in
securities rated AAA, and 37% was held in securities rated AA. The average
modified duration of IPC's fixed maturity portfolio was 2.8 years. IPC's
portfolio does not contain any investments in real estate or mortgage loans.
To further enhance liquidity, in July 1998, IPCRe entered into a five year,
revolving credit agreement with a syndicate of financial institutions led by
The First National Bank of Chicago, in the amount of $300.0 million. This
facility has certain financial covenants, including minimum net worth
provisions, restrictions on the amount of dividends that IPCRe may pay to net
income of the previous twelve months, and certain investment restrictions. No
amounts have been drawn under this facility. Management believes that this
facility, and the relatively high quality of its investment portfolio,
provides sufficient liquidity to meet IPC's cash demands.

Neither the Company, IPCRe nor Services have any material commitments for
capital expenditures.

YEAR 2000 READINESS DISCLOSURE STATEMENT

Certain computer programs use only the last two digits to refer to a year.
Therefore, these computer programs do not properly recognize the century in
which a particular year occurs and may, for example, treat "00" as being the
year 1900, instead of the year 2000. These computer programs may be used in
software applications or may be embedded in microprocessors used to control the
operation of computer hardware and other devices. If not corrected, many
computer programs could fail or create erroneous results. This problem is
commonly known as the "Y2K", "Millennium Bug" and/or "Year 2000" issue and
systems and equipment which use computer programs that do not have this problem
are generally referred to as being "compliant".

IPC's Critical Systems

IPC believes that all of its critical systems, including its hardware and
software, are currently compliant. IPC's critical systems include those used in
assessing underwriting risk, recording policy details, processing related
premium and claims transactions and communicating with brokers who produce the
business. Following minor remedial work to some computer hardware and the
upgrading of some software, a test programme was undertaken on these systems and
the results were completed by September 30, 1998 and subjected to audit by
technology consultants provided through American International Group, Inc.
("AIG"). Accordingly, while there can be no assurance that these systems will be
free from failure, IPC believes that any failure will not result in material
adverse impact on IPC's results of operations or financial condition.

Third Party Dependencies

IPC's Y2K compliance programme also includes a review of third party
dependencies, which includes non-information technology areas, including office
equipment, power supply, telecommunications and building infrastructure.


                                       9
<PAGE>   10
   Administrative Services

IPC's day-to-day administrative services, including the provision of
non-information technology, are performed by American International Company,
Limited ("AICL"), a wholly-owned subsidiary of AIG, pursuant to an
administrative services agreement (the "Administrative Services Agreement").
Services and facilities provided pursuant to the Administrative Services
Agreement include legal and accounting services, office space in Bermuda, the
use of office equipment, electronic data services and other services required by
IPC in the ordinary course of business. IPC and AICL have worked jointly to
ensure compliance of systems used in the processing of IPC's business and this
work was successfully completed by September 30, 1998.

In addition, AICL is monitoring progress towards compliance by significant third
parties from whom IPC receives non-information technology services, such as the
suppliers of electric power and local and long-distance telephone services. In
the event that such third parties are unable to achieve compliance, AICL has
developed contingency plans, for example, independent power supply, which are
designed to mitigate the effects of a failure on the part of such third parties
to supply services.

Accordingly, while there can be no assurance that these systems will be free
from failure, IPC believes that any failure will not result in material adverse
impact on IPC's results of operations or financial condition.

   Other Third Parties

Prior to December 31, 1998, IPC intends to contact other third parties, such as
brokers and depository institutions, with whom IPC currently has a relationship
which, in IPC's judgement, involves material Y2K compliance concerns, in order
to establish their degree of compliance and/or their plans to become compliant
prior to December 31, 1999. Among other things, IPC's brokers collect, and
maintain records of, premiums and claims and, as such, make payments into IPC's
depository institutions. Prior to June 30, 1999, IPC intends to develop
contingency plans to mitigate the effects of the failure of such third party
systems on IPC's business operations. There can be no assurance that the systems
of such third parties will be timely converted, that IPC will be able to develop
satisfactory contingency plans or that failure of such systems in any event
would not have a material adverse effect on IPC's results of operations or
financial condition.

Costs

The costs incurred by IPC up to September 30, 1998 in effecting Y2K compliance
of its own systems are nominal and it is not anticipated that the future costs
of IPC's Year 2000 evaluation and compliance implementation will be material. In
addition, AICL is responsible for the cost of compliance of the administrative
services it supplies to IPC. Therefore, assuming compliance has been achieved as
aforesaid, it is not anticipated that the total costs incurred in relation to
the Y2K issue will have a material adverse effect on IPC's results of
operations.

Policy Risks

The extent of worldwide property damage (whether insured or uninsured) which
could result from failure or malfunction of non-compliant systems is not known.
Many of the insurance markets around the world in which IPC's clients operate
have not established a clear position on whether to include or exclude Y2K risk
in policies available in those markets. Although Y2K exclusion clauses have been
produced by some individual companies and some insurance and reinsurance
industry associations, to date they have not been applied in a uniform manner.
The Y2K issue is unique. Therefore, notwithstanding the presence or absence of
an exclusion of the Y2K risk in insurance or reinsurance policies, in the
general absence of legal precedent, courts may determine, on a case-by-case
basis, that coverage exists for property damage resulting from failure or
malfunction of non-compliant systems.

IPCRe is principally an excess of loss property catastrophe reinsurer.
Currently, IPCRe's reinsurance policies do not specifically include Y2K as a
covered event and IPCRe currently does not intend to provide specific
coverage for losses arising from Y2K events. However, in the future, it is
possible that market forces could oblige IPCRe to provide such coverage, or
that certain of IPCRe's policies could be held to cover such losses.
Approximately 60% of IPCRe's policies by premium volume are subject to
renewal on January 1, 1999 and IPC will be carefully monitoring the terms of
these renewals over the next seven weeks with respect to the extent that they
oblige IPC to provide such coverage. If IPCRe is obliged to provide such
coverage or its policies are held to cover such losses, there can be no
assurance that such losses would not have a material adverse effect on
IPCRe's future results of operations or financial condition, principally in
the year 2000.


                                       10
<PAGE>   11
ITEM 3.  QUALITATIVE AND QUANTITATIVE DISCLOSURE ABOUT MARKET RISK

Not Applicable

NOTE ON FORWARD-LOOKING STATEMENTS

This Report contains certain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934. Forward-looking statements are statements
other than historical information or statements of current condition. Some
forward-looking statements may be identified by use of terms such as
"believes", "anticipates", "intends", or "expects". These forward-looking
statements relate to the plans and objectives of the Company, for future
operations. In light of the risks and uncertainties inherent in all future
projections, the inclusion of forward-looking statements in this report
should not be considered as a representation by the Company or any other
person that the objectives or plans of the Company will be achieved. Numerous
factors could cause the Company's actual results to differ materially from
those in the forward-looking statements, including the following: (i) the
occurrence of catastrophic events with a frequency or severity exceeding the
Company's estimates; (ii) a decrease in the level of demand for property
catastrophe reinsurance, or increased competition owing to increased capacity
of property catastrophe reinsurers; (iii) any lowering or loss of one of the
financial ratings of IPCRe, or IPCRe's non-admitted status in United States
jurisdictions; (iv) loss of services of any one of the Company's executive
officers; (v) the passage of federal or state legislation subjecting the
Company or IPCRe to supervision or regulation in the United States; (vi)
challenges by insurance regulators in the United States or the United Kingdom
to IPCRe's claim of exemption from insurance regulation under current laws;
or (vii) a contention by the United States Internal Revenue Service that the
Company or IPCRe is engaged in the conduct of a trade or business within the
U.S. The foregoing review of important factors should not be construed as
exhaustive; the Company undertakes no obligation to release publicly the
results of any future revisions it may make to forward-looking statements to
reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.

PART II - OTHER INFORMATION

   ITEM 1.     LEGAL PROCEEDINGS

               NONE

   ITEM 2.     CHANGES IN SECURITIES

               NONE

   ITEM 3.     DEFAULTS UPON SENIOR SECURITIES

               NONE

   ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS

               NONE

   ITEM 5.     OTHER INFORMATION

               On October 20, 1998, IPCRe incorporated a new subsidiary, IPCRe
               Europe Limited, in Ireland. The new company intends to underwrite
               selected reinsurance in Europe.


                                       11
<PAGE>   12
   ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

               (a) Exhibits

               Unless otherwise indicated, exhibits are incorporated by
               reference to the corresponding numbered exhibits to the Company's
               Registration Statement on Form S-1 (Registration No. 333-00088).

     EXHIBIT
     NUMBER    DESCRIPTION

       3.1     Memorandum of Association of the Company

       3.2     Amended and Restated Bye-laws of the Company

       3.3     Form of Memorandum of Increase of Share Capital

      11.1 *   Reconciliation of the numerator and denominator for basic and
               diluted net income per common share ("EPS").

      27.1 *   Financial Data Schedule

           *   Filed herewith

               (b) Reports on Form 8-K

               NONE


                                       12
<PAGE>   13
                               IPC HOLDINGS, LTD.

                                   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.



                                    IPC HOLDINGS, LTD.
                                    ------------------
                                       (REGISTRANT)




DATE  NOVEMBER 12, 1998              /s/ John P. Dowling
      -----------------              -------------------
                                    JOHN P. DOWLING
                                    PRESIDENT AND CHIEF EXECUTIVE OFFICER




DATE  NOVEMBER 12, 1998              /s/ John R. Weale
      -----------------              -----------------
                                    JOHN R. WEALE
                                    VICE PRESIDENT AND CHIEF FINANCIAL OFFICER



                                       13
<PAGE>   14
                                  EXHIBIT INDEX


     Unless otherwise indicated, exhibits are incorporated by reference to the
   corresponding numbered exhibits to the Company's Registration Statement on
   Form S-1 (Registration No. 333-00088).

<TABLE>
<CAPTION>
     EXHIBIT
     NUMBER    DESCRIPTION
     ------    -----------
<S>            <C>
       3.1     Memorandum of Association of the Company

       3.2     Amended and Restated Bye-laws of the Company

       3.3     Form of Memorandum of Increase of Share Capital

      11.1  *  Reconciliation of the numerator and denominator for basic and
               diluted net income per common share ("EPS")

      27.1  *  Financial Data Schedule
</TABLE>

            *  Filed herewith


                                       14