<PAGE>

                                 UNITED STATES
                                 -------------
                      SECURITIES AND EXCHANGE COMMISSION
                      ----------------------------------
                            Washington, D.C. 20549
                            ----------------------
                                  FORM 10 - Q
                                  -----------

                 Quarterly Report Under Section 13 or 15 (d)
                    of the Securities Exchange Act of 1934

                                  ----------

  For Quarter Ended June 30, 2001             Commission file Number 0-11538
                    -------------                                    -------


                          Overseas Partners Ltd.
------------------------------------------------------------------------------
              (Exact name of registrant as specified in its charter)


     Islands of Bermuda                                           N/A
-------------------------------------------------------------------------------
 (State or other jurisdiction of                            (I.R.S. Employer
 incorporation or organization)                             Identification No.)


Mintflower Place, 8 Par-la-Ville Road, Hamilton HM 08, Bermuda
--------------------------------------------------------------------------------
     (Address of principal executive offices)                         (Zip Code)


   Registrant's telephone number, including area code      (441) 295-0788
                                                      -------------------------


                                 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, and (2) has been subject to such filing requirements
for the past 90 days.

YES  X    NO
    ---       ---


                    Common Stock, par value $.10 per share
                    --------------------------------------
                               (Title of Class)

                              118,683,653 Shares
                          ---------------------------
                        Outstanding at August 10, 2001
<PAGE>

                         PART I, FINANCIAL INFORMATION

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
              (In thousands, except share and per share amounts)

<TABLE>
<CAPTION>
                                                                                   June 30,    December 31,
                                                                                       2001            2000
                                                                                (Unaudited)
                                                                                -----------     -----------
<S>                                                                             <C>              <C>
ASSETS:
Investments:
   Trading, at fair value-
    Debt securities (amortized cost 2001 - $nil, 2000 - $549,422)                $       --      $  539,302
    Equity securities (cost 2001 - $653,778, 2000 - $1,242,202)                     702,634       1,525,453
   Available-for-sale, at fair value-
    Debt securities (amortized cost 2001 - $803,101, 2000 - $44,554)                768,665          44,620
    Equity securities (cost 2001 - $776,916, 2000 - $nil)                           757,472              --
 Held-to-maturity, at amortized cost-
    Restricted investments (fair value 2001 - $291,186, 2000 - $285,067)            241,853         242,209
-----------------------------------------------------------------------------------------------------------
                                                                                  2,470,624       2,351,584
Cash and cash equivalents                                                           232,199         515,159
Receivables                                                                         868,408         685,998
Deferred acquisition costs                                                           89,293          53,075
Real estate and leasing:
  Operating lease with UPS                                                           95,089          96,335
  Finance lease                                                                      42,537          43,886
  Hotel                                                                             152,720         155,219
  Office buildings                                                                  310,245         582,365
Other assets
  Goodwill                                                                            6,071          23,568
  Other                                                                              84,356          70,395
-----------------------------------------------------------------------------------------------------------
Total assets                                                                     $4,351,542      $4,577,584
-----------------------------------------------------------------------------------------------------------

LIABILITIES AND MEMBERS' EQUITY:
Liabilities:
Accrued losses and loss expenses                                                 $1,437,449      $1,416,733
Unearned premiums                                                                   497,812         301,572
Reinsurance balances payable                                                        125,705          77,088
Accounts payable and other accruals                                                  50,402          57,428
Deferred income taxes                                                                14,247           6,116
Short-term debt                                                                          --         135,000
Long-term debt                                                                      559,620         761,943
Minority interest                                                                    42,117          43,699
-----------------------------------------------------------------------------------------------------------
Total liabilities                                                                $2,727,352      $2,799,579
-----------------------------------------------------------------------------------------------------------

Commitments and contingencies                                                            --              --

Members' equity:
Preference Stock, par value $0.10 per share; authorized 200 million shares;
  none issued                                                                            --              --
Common Stock, par value $0.10 per share; authorized 900 million shares;
  issued 127.5 million shares; outstanding 119,037,611 shares                        12,750          12,750
Contributed surplus                                                                  39,991          39,991
Retained earnings                                                                 1,782,992       1,850,577
Treasury stock (2001 - 8,462,389 shares, 2000 - 6,563,319 shares), at cost         (157,663)       (125,379)
Accumulated other comprehensive (loss) income                                       (53,880)             66
-----------------------------------------------------------------------------------------------------------
Total members' equity                                                             1,624,190       1,778,005
-----------------------------------------------------------------------------------------------------------
Total liabilities and members' equity                                            $4,351,542      $4,577,584
-----------------------------------------------------------------------------------------------------------
</TABLE>
           See notes to unaudited consolidated financial statements.
<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF INCOME
                   (In thousands,  except per share amounts)
                                  (Unaudited)

<TABLE>
<CAPTION>

                                                               Three Months Ended June 30,         Six Months Ended June 30,
                                                               ---------------------------         ---------------------------
                                                                 2001              2000              2001               2000
                                                               --------         ----------         ---------         ---------
<S>                                                            <C>              <C>               <C>               <C>
REVENUES:
Gross reinsurance premiums written                             $176,940         $ 178,981         $ 520,280          $ 464,503
Reinsurance premiums ceded                                       (7,369)           (5,231)          (27,004)           (43,776)
------------------------------------------------------------------------------------------------------------------------------
Reinsurance premiums written                                    169,571           173,750           493,276            420,727
Change in unearned premiums                                      14,695            (9,628)         (187,628)          (128,293)
------------------------------------------------------------------------------------------------------------------------------
Reinsurance premiums earned                                     184,266           164,122           305,648            292,434
Commission and fee income                                           947             1,446             3,290              2,768
Operating lease with UPS                                          4,677             4,637             9,308              9,242
Finance lease                                                       860               915             1,742              1,839
Hotel                                                            27,055            28,959            50,734             51,265
Office buildings                                                 18,441            39,203            46,272             77,326
Gain on sales of real estate assets and PIP                      36,605                --            41,766                 --
Interest                                                         13,071            14,874            30,793             30,515
Realized gain on trading and available-for-sale securities       26,338             4,154           186,196             43,663
Unrealized gain (loss) on trading securities                     22,289           (41,267)         (224,437)           (73,485)
Amortization of fixed income securities                           5,160             3,686             8,845              7,364
Dividends                                                         4,906             3,085             9,590              5,987
------------------------------------------------------------------------------------------------------------------------------
                                                                344,615           223,814           469,747            448,918
------------------------------------------------------------------------------------------------------------------------------

EXPENSES:
Reinsurance losses and loss expenses                            146,693           579,031           251,659            687,447
Reinsurance commissions, taxes and other                         54,216            62,536            93,987             86,616
Depreciation expense                                              4,898             9,509             9,783             18,734
Real estate and leasing operating expenses                       30,501            39,379            62,563             76,221
Interest expense                                                 12,798            17,575            29,242             35,167
Minority interest in earnings                                     1,049               929             2,284              1,608
Investment expenses                                               1,464             1,261             3,096              2,683
Amortization of goodwill                                            348               747             1,101              1,493
Other operating expenses                                          3,646             3,035             7,339              6,556
------------------------------------------------------------------------------------------------------------------------------
                                                                255,613           714,002           461,054            916,525
------------------------------------------------------------------------------------------------------------------------------

Income (loss) before income taxes                                89,002          (490,188)            8,693           (467,607)
Income taxes                                                    (19,540)           (7,069)          (22,196)            (9,568)
------------------------------------------------------------------------------------------------------------------------------
Net income (loss)                                              $ 69,462         $(497,257)        $ (13,503)         $(477,175)
------------------------------------------------------------------------------------------------------------------------------

Basic and diluted net income (loss) per share                  $   0.58         $   (4.02)        $   (0.11)         $   (3.86)
------------------------------------------------------------------------------------------------------------------------------
Weighted average number of shares outstanding                   119,278           123,581           119,806            123,693
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
           See notes to unaudited consolidated financial statements.

<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                   (In thousands, except per share amounts)
                                  (Unaudited)

<TABLE>
<CAPTION>

                                                               Three Months Ended June 30,         Six Months Ended June 30,
                                                               ---------------------------         ---------------------------
                                                                 2001              2000              2001               2000
                                                               --------         ----------         ---------         ---------
<S>                                                            <C>              <C>               <C>               <C>
Net income (loss)                                              $ 69,462         $(497,257)         $(13,503)         $(477,175)

Other comprehensive loss:
Net unrealized holding gains (losses) on available-for-sale
  securities                                                     24,227                --           (18,990)                --
Less: reclassification adjustment for gains included in
  net income                                                    (35,382)               --           (35,609)                --
------------------------------------------------------------------------------------------------------------------------------
Other comprehensive loss before income tax                      (11,155)               --           (54,599)                --

Income tax recovery related to other comprehensive
  income items                                                      679                --               653                 --
------------------------------------------------------------------------------------------------------------------------------
Other comprehensive loss                                        (10,476)               --           (53,946)                --
------------------------------------------------------------------------------------------------------------------------------
Comprehensive income (loss)                                    $ 58,986         $(497,257)         $(67,449)         $(477,175)
------------------------------------------------------------------------------------------------------------------------------
</TABLE>

           See notes to unaudited consolidated financial statements.
<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF MEMBERS' EQUITY
                    Six Months Ended June 30, 2001 and 2000
                                (In thousands)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                            Accumulated
                                                                                                               Other        Total
                             Preference     Common Stock       Treasury Stock    Contributed     Retained  Comprehensive   Members'
                               Stock     Shares     Amount     Shares   Amount      Surplus       Earnings  Income (Loss)   Equity
                             ----------  -------  ---------  -------- ---------  ------------  ----------- -------------- --------
<S>                          <C>         <C>       <C>        <C>       <C>       <C>           <C>        <C>            <C>
Balance, January 1, 2000      $    --     127,500   $12,750  (3,109)  $ (62,132)     $39,991    $2,556,774   $    --     $2,547,383


Net loss                           --        --        --       --          --           --       (477,175)       --       (477,175)

Purchase of shares                 --        --        --      (893)    (19,215)         --             --        --        (19,215)

Dividend paid ($0.60 per
 share)                            --        --        --       --          --           --        (74,247)       --        (74,247)
------------------------------------------------------------------------------------------------------------------------------------
Balance, June 30, 2000        $    --     127,500   $12,750  (4,002)  $ (81,347)     $39,991    $2,005,352   $    --     $1,976,746
------------------------------------------------------------------------------------------------------------------------------------

Balance, January 1, 2001      $    --     127,500   $12,750  (6,563)  $(125,379)     $39,991    $1,850,577   $    66     $1,778,005


Net loss                           --        --        --       --          --           --        (13,503)       --       (13,503)

Purchase of shares                 --        --        --    (1,899)    (32,284)         --            --         --        (32,284)

Dividend paid ($0.45 per
 share)                            --        --        --       --          --           --        (54,082)       --        (54,082)

Net unrealized loss on
 available-for-sale
   securities, net of tax          --        --        --       --          --           --            --     (53,946)      (53,946)
------------------------------------------------------------------------------------------------------------------------------------
Balance, June 30, 2001        $    --     127,500   $12,750  (8,462)  $(157,663)     $39,991    $1,782,992   $(53,880)   $1,624,190
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

            See notes to unaudited consolidated financial statements.

<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (U.S.$ in thousands)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                           Six Months Ended June 30,
                                                                           -------------------------
                                                                               2001         2000
                                                                           -----------   -----------
<S>                                                                        <C>           <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net loss                                                                   $   (13,503)   $(477,175)
Adjustments to reconcile net loss to net cash
 provided by operating activities:
  Deferred income taxes                                                          8,131        2,506
  Depreciation expense                                                           9,783       18,734
  Minority interest in earnings                                                  2,284        1,608
  Realized gain on trading and available-for-sale securities                  (186,196)     (43,663)
  Unrealized loss on trading securities                                        224,437       73,485
  Amortization of fixed income securities                                       (8,845)      (7,364)
  Gain on sales of real estate assets and PIP                                  (41,766)          --
  Other                                                                          1,662        2,395
Changes in assets and liabilities:
  Receivables                                                                 (182,410)    (200,359)
  Deferred acquisition costs                                                   (36,218)       7,581
  Other assets                                                                 (13,961)     (24,338)
  Accrued losses and loss expenses                                              20,716      473,970
  Unearned premiums                                                            196,240      152,037
  Reinsurance balances payable                                                  48,617       38,549
  Accounts payable and other accruals                                           (7,026)       6,328
Proceeds from sale of trading investments                                    2,689,921      536,003
Purchase of trading investments                                             (1,401,650)    (549,904)
---------------------------------------------------------------------------------------------------
Net cash flow provided by operating activities                               1,310,216       10,393
---------------------------------------------------------------------------------------------------

CASH FLOW FROM INVESTING ACTIVITIES:
Proceeds from sales and maturities of available-for-sale investments           924,641           --
Purchase of available-for-sale investments                                  (2,423,031)          --
Proceeds from maturity of restricted investments                                 9,510        9,473
Purchase of restricted investments                                              (1,773)      (1,903)
Net proceeds from sales of real estate assets and PIP                          126,918           --
Additions to real estate and leasing assets                                       (247)     (12,435)
---------------------------------------------------------------------------------------------------
Net cash flow used by investing activities                                  (1,363,982)      (4,865)
---------------------------------------------------------------------------------------------------

CASH FLOW FROM FINANCING ACTIVITIES:
Purchases of treasury stock                                                    (32,284)     (19,215)
Repayment of debt                                                             (138,962)      (5,134)
Distributions to minority interest                                              (3,866)      (1,008)
Dividends paid                                                                 (54,082)     (74,247)
---------------------------------------------------------------------------------------------------
Net cash flow used by financing activities                                    (229,194)     (99,604)
---------------------------------------------------------------------------------------------------

Net decrease in cash and cash equivalents                                     (282,960)     (94,076)

Cash and cash equivalents:
Beginning of period                                                            515,159      450,336
---------------------------------------------------------------------------------------------------
End of period                                                              $   232,199    $ 356,260
---------------------------------------------------------------------------------------------------

Supplemental disclosures of cash flow information:
Cash paid during the period:
    U.S. income taxes                                                      $    14,403    $   7,005
    Interest                                                               $    27,476    $  35,566
Assignment of debt in partial consideration for sale of office building    $   198,389    $      --
---------------------------------------------------------------------------------------------------
</TABLE>
           See notes to unaudited consolidated financial statements.
<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
             NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 2001
                                  (Unaudited)


1.   GENERAL
     -------

The accompanying unaudited interim consolidated financial statements include the
accounts of Overseas Partners Ltd. and its subsidiaries (collectively OPL or the
Company).  OPL is engaged in the property and casualty reinsurance business and
in the real estate and leasing business.

The interim financial statements have been prepared pursuant to the rules and
regulations for reporting on Form 10-Q.  Accordingly, certain information and
footnotes required by generally accepted accounting principles for complete
financial statements are not included herein.  The interim financial statements
should be read in conjunction with the Overseas Partners Ltd. Annual Report on
Form 10-K for the fiscal year ended December 31, 2000.

Interim financial statements are subject to possible adjustments in connection
with the annual audit of the Company's financial statements for the full year;
in the Company's opinion, all adjustments necessary for a fair presentation of
these interim statements have been included and are of a normal and recurring
nature.

The results of operations for the three and six-month periods ended June 30,
2001 and 2000 are not necessarily indicative of the results to be expected for
the full year.

2.  SIGNIFICANT ACCOUNTING POLICIES
    -------------------------------

Except as described in Note 1, the financial statements have been prepared in
accordance with accounting principles generally accepted in the United States of
America.  All activity is recorded in U.S. dollars.  Inter-company balances and
transactions have been eliminated in consolidation.

On July 20, 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 141, "Business Combinations", (SFAS 141) and
Statement of Financial Accounting Standards No. 142, "Goodwill and Other
Intangible Assets", (SFAS 142). These Statements make significant changes to the
accounting for business combinations, goodwill, and intangible assets.  SFAS 141
eliminates the pooling-of-interests method of accounting for business
combinations with limited exceptions for combinations initiated prior to July 1,
2001. In addition, it further clarifies the criteria for recognition of
intangible assets separately from goodwill.  This statement is effective for
business combinations completed after June 30, 2001.

SFAS 142 discontinues the practice of amortizing goodwill and indefinite lived
intangible assets and initiates an annual review for impairment. Impairment
would be examined more frequently if certain indicators are encountered.  The
Company will adopt this standard effective January 1, 2002 and does not believe
the impact on its financial statements will be significant.

3.  TAXES
    -----

Overseas Partners Ltd. and certain of its subsidiaries are incorporated under
the laws of the Islands of Bermuda.  Overseas Partners Ltd. believes that
neither it nor its Bermuda subsidiaries carry on business through a permanent
establishment in the United States.  Therefore, it does not expect itself or its
Bermuda subsidiaries to be subject to U.S. income taxes.  Under current Bermuda
law, Overseas Partners Ltd. and its Bermuda subsidiaries are not obligated to
pay any tax in Bermuda based upon income or capital gains.

On December 22, 1998, the IRS issued a Notice of Deficiency with respect
to Overseas Partners Ltd.'s 1988 through 1990 taxable years in which it asserted
that Overseas Partners Ltd. is subject to U.S. taxation in the aggregate amount
of approximately $170 million, plus additions to tax and interest, for those
years.  On March 19, 1999, Overseas Partners Ltd. filed a petition in the United
States Tax Court contesting the asserted deficiencies in tax and additions to
tax in the Notice.  On May 18, 1999, the IRS filed its Answer to Overseas
Partners Ltd.'s Petition. The IRS has also asserted that Overseas Partners Ltd.
is subject to U.S. taxation for its 1991 through 1994 taxable years and has
proposed an aggregate assessment of $319 million of tax, plus additions to tax
and interest, for those years.  Overseas Partners Ltd. has filed a Protest
against the proposed assessment with the Appellate Division of the IRS with
respect to the years 1991 through 1994.  The IRS has not proposed an assessment
for years subsequent to 1994.  However, the IRS may take similar positions for
subsequent years pending resolution of the years currently in dispute.

Overseas Partners Ltd. believes that it has no tax liability, that it is not
subject to U.S. taxation, and that there is substantial authority for its
position.  It is vigorously contesting the Notice of Deficiency for 1988 through
1990 and will vigorously contest the proposed assessments for 1991 through 1994
and any future assessments.

Certain of OPL's subsidiaries are incorporated in the U.S., including Overseas
Partners Capital Corp. (OPCC) and Overseas Partners US Reinsurance Company (OPUS
Re).  These subsidiaries are subject to U.S. income taxes.
<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
             NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 2001
                                  (Unaudited)


4.  BUSINESS SEGMENTS
    -----------------

The Company's operations are presently conducted through two segments -
reinsurance and real estate and leasing. The reinsurance segment is managed from
the Bermuda and Philadelphia offices (through U.S. subsidiaries) and includes
accident & health, agricultural, aviation, casualty, professional liability,
property, property catastrophe, workers' compensation and finite risk business.
Real estate and leasing activities are owned and managed through U.S.
subsidiaries of OPCC, a wholly-owned subsidiary of OPL. There were no inter-
segment revenues earned for the periods ended June 30, 2001 and 2000. Inter-
segment expenses, such as corporate overhead, were allocated based on estimated
utilization for the periods ended June 30, 2001 and 2000.

The accounting policies of the segments are the same as those described in the
summary of significant accounting policies disclosed in the Overseas Partners
Ltd. Annual Report on Form 10-K for the fiscal year ended December 31, 2000.
Income before income taxes by segment consists of revenues less expenses related
to the respective segment's operations.  The reinsurance segment maintains a
portfolio of cash and liquid investments to support its reserves for accrued
losses and loss expenses and unearned premiums as well as its capital
requirements. Investments relating to real estate and leasing are primarily used
to collateralize long-term debt issued in connection with the purchase of real
estate properties, operating leases and finance leases.  Summary financial
information about the Company's segments is presented in the following table:

<TABLE>
<CAPTION>
                                Three months ended June 30,    Six months ended June 30,
                                ---------------------------    -------------------------
(In thousands)                      2001            2000          2001           2000
                                 ----------       ---------    ---------      ----------
<S>                                <C>            <C>            <C>            <C>
REVENUES
Reinsurance:
  Premiums earned                  $184,266       $ 164,122      $305,648      $ 292,434
  Commission and fee income             947           1,446         3,290          2,768
  Gain on sale of PIP                 5,964              --         5,964             --
  Investment income (loss)           60,633         (28,567)         (859)        (6,610)
----------------------------------------------------------------------------------------
                                    251,810         137,001       314,043        288,592
----------------------------------------------------------------------------------------
Real estate and leasing:
  Rentals                            51,033          73,714       108,056        139,672
  Gain on sale of assets             30,641              --        35,802             --
  Investment income                  11,131          13,099        11,846         20,654
----------------------------------------------------------------------------------------
                                     92,805          86,813       155,704        160,326
----------------------------------------------------------------------------------------
Consolidated                        344,615         223,814       469,747        448,918
----------------------------------------------------------------------------------------

NET INCOME BEFORE TAXES
Reinsurance                          49,437        (505,827)      (34,699)      (488,154)
Real estate and leasing              43,559          19,421        51,832         28,596
Other operating expenses             (3,994)         (3,782)       (8,440)        (8,049)
----------------------------------------------------------------------------------------
Consolidated                       $ 89,002       $(490,188)     $  8,693      $(467,607)
----------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>

(In thousands)             June 30, 2001  December 31, 2000
                                              (Audited)
                           -------------  -----------------
<S>                        <C>            <C>
ASSETS
Reinsurance
  Cash and investments        $2,347,923         $2,486,330
  Other                        1,016,534            792,508
-----------------------------------------------------------
                               3,364,457          3,278,838
-----------------------------------------------------------
Real estate and leasing
  Cash and investments           354,900            380,413
  Other                          632,185            918,333
-----------------------------------------------------------
                                 987,085          1,298,746
-----------------------------------------------------------
Consolidated                  $4,351,542         $4,577,584
-----------------------------------------------------------
</TABLE>

<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
             NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 2001
                                  (Unaudited)


4.  BUSINESS SEGMENTS (continued)
    -----------------

Substantially all of the Company's long-lived assets, interest expense,
depreciation expense and income tax expense relate to the Company's real estate
and leasing operations.

Approximately 85% of reinsurance revenues were derived primarily from sources
located in the United States.  Other revenues were derived from customers
located primarily in European countries.  All of the Company's leasing and real
estate revenues are generated in the United States.  For 2001 and 2000, all of
the Company's long-lived assets were located in the United States.

OPL earned premiums of $4.6 million and $15.3 million for the three months ended
June 30, 2001 and 2000, respectively for the reinsurance of workers'
compensation insurance, written by Liberty Mutual Insurance Company, for
employees of United Parcel Service of America, Inc. (UPS) located in the United
States.  OPL earned premiums of $9.3 million and $28.0 million for the six
months ended June 30, 2001 and 2000, respectively for the reinsurance of this
workers' compensation insurance.

OPL's real estate and leasing segment includes a data processing facility leased
to a UPS subsidiary.  Total rent from the facility lease was $4.7 million and
$4.6 million for the three months ended June 30, 2001 and 2000, respectively.
Total rent from the facility lease was $9.3 million and $9.2 million for the six
months ended June 30, 2001 and 2000, respectively.

5.  STATUTORY FINANCIAL INFORMATION
    -------------------------------

The Company and its reinsurance subsidiaries are subject to insurance laws and
regulations in the jurisdictions in which they operate.  In Bermuda, the Bermuda
Insurance Act of 1978, amendments thereto and related Regulations require OPL
and its Bermuda based reinsurance subsidiaries to each maintain a minimum
solvency margin and a liquidity ratio.  For the six months ended June 30, 2001
and 2000, each of the Bermuda based reinsurance companies met these
requirements.  The Company's ability to pay dividends to shareowners is not
currently affected by these requirements.  OPL's U.S. based reinsurance
subsidiary, OPUS Re, is subject to regulations that include restrictions that
limit the amount of dividends or other distributions, such as loans or cash
advances, available to shareowners without prior approval of the insurance
regulatory authorities.

6.  CONTINGENCIES
    -------------

On November 19, 1999 and January 27, 2000 OPL was named as a defendant in two
class action lawsuits, filed on behalf of customers of UPS, in Montgomery
County, Ohio Court and Butler County, Ohio Court, respectively.  The lawsuits
allege, amongst other things, that UPS told its customers that they were
purchasing insurance for coverage of loss or damage to goods shipped by UPS. The
lawsuits further allege that UPS wrongfully enriched itself with the monies paid
by its customers to purchase such insurance.  The November 19, 1999 and January
27, 2000 actions were removed to federal court and thereafter transferred to the
United States District Court for the Southern District of New York and
consolidated in a multi-district litigation for pretrial discovery purposes with
other actions asserting claims against UPS.  Plaintiffs subsequently amended
those claims against all defendants to join a RICO claim as well.  On August 7,
2000, the Company and its wholly owned subsidiary, OPCC, were added as
defendants in a third class action lawsuit, also consolidated in the multi-
district litigation, which alleges violations of United States antitrust laws,
and state unfair trade practice and consumer protection laws.  The allegations
in the lawsuits are drawn from an opinion by the United States Tax Court that
found that the insurance program, as offered through UPS, by domestic insurance
companies, and ultimately reinsured by OPL, should not be recognized for federal
income tax purposes.  In June 2001, the Tax Court opinion was reversed by the
United States Court of Appeals for the Eleventh Circuit and remanded to the Tax
Court for further consideration, although there is pending a Petition for
Rehearing that was filed with the Court of Appeals for the Eleventh Circuit in
early August 2001.  The Company believes that it has meritorious defenses to all
three actions and intends to defend them vigorously.  The Company has filed
motions to dismiss all of the actions on a number of grounds, including that the
antitrust claim fails to state a claim upon which relief can be granted, and
that the remaining claims are preempted by federal law.  There can be no
assurance, however, that an adverse determination of the lawsuits would not have
a material effect on the Company.
<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
                     Item 2.  MANAGEMENT'S DISCUSSION AND
                                  ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                         (Transacted in U.S. Dollars)


RESULTS OF OPERATIONS
---------------------

Three Months Ended June 30, 2001 and 2000
-----------------------------------------

Reinsurance:
-----------

<TABLE>
<CAPTION>

(In thousands)                                     2001       2000
<S>                                             <C>         <C>
---------------------------------------------------------------------
Gross premiums written                          $ 176,940   $ 178,981
Premiums ceded                                     (7,369)     (5,231)
---------------------------------------------------------------------
Net premiums written                              169,571     173,750
Change in unearned premiums                        14,695      (9,628)
---------------------------------------------------------------------
Premiums earned                                   184,266     164,122
Commission and fee income                             947       1,446
---------------------------------------------------------------------
                                                  185,213     165,568
---------------------------------------------------------------------
Losses and loss expenses                         (146,693)   (579,031)
Commissions, taxes and underwriting expenses      (54,216)    (62,536)
---------------------------------------------------------------------
                                                 (200,909)   (641,567)
---------------------------------------------------------------------
Underwriting loss                                 (15,696)   (475,999)
---------------------------------------------------------------------

Investment income (loss)                           59,169     (29,828)

Gain on sale of PIP                                 5,964          --
---------------------------------------------------------------------

Reinsurance income (loss)                       $  49,437   $(505,827)
=====================================================================
</TABLE>

Underwriting

Gross premiums written for the three months ended June 30, 2001 reflect $88.7
million of new business and $118.9 million of renewals compared with $82.4
million and $98.6 million, respectively, for the same period in the prior year.

New business for the three months ended June 30, 2001 included three new
accident & health programs and one new multi-line program generating $21.5
million and $11.5 million in gross premiums written respectively as well as
$54.9 million of gross premiums written by our subsidiary, OPUS Re.

We renewed three large accident & health programs and one workers' compensation
program generating gross premiums written of $40.2 million and $53.5 million
respectively.  We have continued to decline to renew several accident & health,
aviation, marine and property programs in line with our strategic plan to focus
on a smaller number of specialized products.  The programs which we declined to
renew contributed $117.0 million towards gross premiums written during the three
months to June 30, 2000.

Our property catastrophe business generated gross written premiums of $19.6
million during the three months ended June 30, 2001 compared with $16.6 million
during the same period in the prior year.  We have exposure to earthquakes,
hurricanes, storms and other catastrophic events, all of which are managed
through the use of underwriting controls and occurrence caps as well as
modeling, monitoring and managing accumulations of potential losses.  We also
use retrocessional programs to limit net losses from catastrophes.  However,
property catastrophe loss experience is generally characterized as low frequency
but high severity in nature which may result in volatility in our future
financial results.

The decrease in gross premiums written of $2.0 million for the three months
ended June 30, 2001 compared with the same period in the prior year is primarily
due to a decrease in premium estimates for prior years of approximately $30.7
million offset by the increase in new and renewal business of $6.3 million and
$20.3 million respectively.

Premiums ceded increased to $7.4 million for the three months ended June 30,
2001 from $5.2 million for the same period last year.  The increase is primarily
due to the property catastrophe quota share retrocession.  This increase
corresponds to the increase in property catastrophe business that is mentioned
above.

Commission and fee income decreased to $0.9 million for the three months ended
June 30, 2001 compared to $1.4 million for the corresponding period in 2000.
This decrease is due to the sale of Parcel Insurance Plan, Inc. (PIP) in May
2001.  This was partially offset by $0.5 million in fees earned on our finite
risk contracts that were not accounted for as reinsurance as they do not satisfy
the risk transfer criteria of Statement of Financial Accounting Standards No.
113.
<PAGE>

Reinsurance: (continued)
------------

Our combined ratio, which is the ratio of the sum of losses, loss expenses,
commissions, taxes and other underwriting expenses to earned premiums was 109.0%
for the three months ended June 30, 2001 and we experienced a net underwriting
loss of $15.7 million.  The underwriting loss and combined ratio for the three
months ended June 30, 2001 was affected by the following factors:

  .    An increase in overhead of approximately $4.0 million following the
       acquisition of OPUS Re in October 2000 and the hiring of a team of finite
       risk underwriters,

  .    Underwriting losses on premiums earned during 2001 but written in prior
       years.

The combined ratio for the three months ended June 30, 2000 was 390.9% and we
experienced a net underwriting loss of $476.0 million. The significant
contributor to the loss in the three months ended June 30, 2000 was reserve
strengthening adjustments of $460 million. The reserve strengthening related
primarily to accident & health, aviation, multi-line, marine and property
programs written during 1997 to 1999.

The Company provided retrocessional reinsurance to a reinsurer that has
commenced an arbitration to rescind its own reinsurance contract with the
primary carrier, principally on the grounds that the primary carrier did not
fully disclose the risks to be covered by the reinsurance contract.  That
contract is expected to be unprofitable.  Thus, if the reinsurer succeeds in the
arbitration it will be relieved of any obligation to pay losses under its
contract and therefore would not cede to the Company any share of those losses.
The arbitration is at an early stage and will likely take many months to
resolve.  As such, it is too early to determine whether the arbitration decision
is likely to be in the reinsurer's favor and therefore benefit OPL as its
retrocessionaire.  The Company continues to reserve for losses and loss expenses
without regard to any possibility that the reinsurer's contract will be
rescinded.

Reinsurance Investment Income (Loss)

<TABLE>
<CAPTION>
                                         Other
                                          Com-
                                    prehensive
                          Income        Income         Total        Income
                          (Loss)        (Loss)        Return        (Loss)
(In thousands)              2001          2001          2001          2000
  <S>                    <C>            <C>         <C>           <C>
----------------------------------------------------------------------------
  U.S. equities          $ 38,314       $10,714     $  49,028      $(22,060)
  Emerging market          11,181            --        11,181       (23,675)
  Fixed income              6,036       (21,091)      (15,055)        3,764
  Multi-manager funds       2,489            --         2,489        10,200
  Other                     2,613           (99)        2,514         3,204
  Expenses                 (1,464)           --        (1,464)       (1,261)
----------------------------------------------------------------------------
                        $  59,169      $(10,476)    $  48,693      $(29,828)
============================================================================
</TABLE>

The Company's reinsurance investments are classified as either trading or
available-for-sale.  The trading portfolio is recorded at fair value with
unrealized gains and losses recorded in net income.  The available-for-sale
portfolio is recorded at fair value with unrealized gains and losses recorded in
shareowners' equity as other comprehensive income.

During March 2001 we sold our trading U.S. S&P 500 equity and global bond
portfolios, reflecting the change in nature of our operations and the
significant growth in our loss reserves following the cancellation of our
shipper's risk business in October 1999 and our diversification into other
reinsurance lines.  We used the proceeds from the sale to acquire new portfolios
of U.S. S&P 500 equity based securities and fixed income securities, which were
classified as available-for-sale in accordance with Statement of Financial
Accounting Standards No. 115.

For the three months ended June 30, 2001 our portfolio generated a total return
of $48.7 million consisting of $59.2 million recorded in income and net
unrealized losses of $10.5 million that were recorded in other comprehensive
income compared to a loss of $29.8 million for the same period in 2000, all of
which was recorded in net income.  During the three months ended June 30, 2000
there were no unrealized gains and losses recorded in other comprehensive income
as our U.S. S&P 500 equity based portfolios and our global bond portfolios held
during that period were trading investments.

For the three months ended June 30, 2001 our U.S. equity portfolios, which
closely track the S&P 500 index, generated a total return of 5.7%, or $49.0
million, of which $38.3 million was recorded in income and net unrealized gains
of $10.7 million were recorded in other comprehensive income compared to a loss
of 2.2%, or $22.1 million, for the same period in 2000. For the three months
ended June 30, 2001 our fixed income portfolios generated a loss of 2.1%, or
$15.1 million, consisting of $6.0 million that was recorded in income and net
unrealized losses of $21.1 million that were recorded in other comprehensive
income, compared to income of $3.8 million, or 0.7%, for the same period in
2000.

Our emerging markets equity portfolio gained 7.0% for the quarter ended June 30,
2001, or $11.2 million, as compared to a loss of $23.7 million, or 9.7% for the
same period in 2000.  Our multi-manager funds, which are primarily a combination
of fixed income strategies, returned $2.5 million for the quarter ended June 30,
2001 compared to $10.2 million for the same period in 2000.  Cash and cash
equivalents earn short-term money market rates which equated to an annualized
return of 4.7% for the three months ended June 30, 2001 compared to 6.6% for the
same period in 2000.
<PAGE>

Real Estate and Leasing:
------------------------

<TABLE>
<CAPTION>

(In thousands)                                   2001       2000
----------------------------------------------------------------
<S>                                          <C>        <C>
REVENUE:
Office buildings                             $ 18,441   $ 39,203
Hotel                                          27,055     28,959
Leasing                                         5,537      5,552
Gain on sale of assets                         30,641         --
----------------------------------------------------------------
                                               81,674     73,714
----------------------------------------------------------------
EXPENSES:
Operating expenses                            (30,501)   (39,379)
Interest expense                              (12,798)   (17,575)
Depreciation                                   (4,898)    (9,509)
Minority interest in earnings                  (1,049)      (929)
----------------------------------------------------------------
                                              (49,246)   (67,392)
----------------------------------------------------------------

----------------------------------------------------------------
Operating income                               32,428      6,322
----------------------------------------------------------------

Investment income:
Real estate investment trust certificates       6,515      8,015
Other                                           4,616      5,084
----------------------------------------------------------------
Investment income                              11,131     13,099
----------------------------------------------------------------

----------------------------------------------------------------
Real estate and leasing income               $ 43,559   $ 19,421
================================================================
</TABLE>

Office building revenue decreased by 53.0% for the three months ended June 30,
2001 from $39.2 million for the same period in 2000. This decrease of $20.8
million was primarily due to the sales of 333 West Wacker and One Buckhead Plaza
in August 2000, Madison Plaza in February 2001 and the Atlanta Financial Center
in April 2001.  Hotel revenue decreased $1.9 million due to a decrease in room
occupancy rates over the same period in 2000.  Leasing revenue for the three
months ended June 30, 2001 is consistent with the same period last year.

In April 2001 we sold the Atlanta Financial Center for net cash proceeds of
$72.8 million.  The purchaser of the property assumed the associated existing
debt of $76.2 million.  The pre-tax gain on sale was $30.6 million.  We intend
to take advantage of other sale opportunities in the real estate market when and
as circumstances permit.  The net proceeds from the sale of properties will be
re-deployed into our reinsurance segment.  However there can be no assurances
that such sales will occur in the short-term.

Operating expenses and depreciation have decreased by $8.9 million and $4.6
million, respectively, both of which were primarily due to the sales of the four
office buildings.  Interest expense has decreased by $4.8 million from the same
period in 2000 also due to the sales of the buildings.  However, this decrease
was partially offset by $0.3 million of interest expense relating to short-term
debt that was obtained to provide temporary working capital.

Investment income decreased by $2.0 million from the same period in 2000
primarily as a result of a $1.5 million decrease in the income from the real
estate investment trusts.

Net Income:
-----------

<TABLE>
<CAPTION>

(In thousands)                               2001       2000
------------------------------------------------------------
<S>                                      <C>        <C>
NET INCOME (LOSS) BEFORE TAXES
Reinsurance                              $ 49,437  $(505,827)
Real estate and leasing                    43,559     19,421
Other operating expenses                   (3,994)    (3,782)
------------------------------------------------------------
Consolidated net income (loss) before
 taxes                                     89,002   (490,188)
Income taxes                              (19,540)    (7,069)
------------------------------------------------------------
Net income (loss)                        $ 69,462  $(497,257)
------------------------------------------------------------
</TABLE>

Net income for the quarter increased by $566.7 million from the same period in
2000 primarily due to the $460 million reserve strengthening during 2000, the
improved performance of the investment markets in 2001 and the gain on sale of
the Atlanta Financial Center, also in 2001.  The tax charge for the three months
ended June 30, 2001 was $19.5 million compared to $7.1 million for the same
period in 2000.  This increase of $12.6 million was due to the tax on the gain
on sale of the office buildings.  Net income per share was $0.58 compared to a
loss per share of $4.02 for the same period in 2000.
<PAGE>

Six Months Ended June 30, 2001 and 2000
---------------------------------------


<TABLE>
<CAPTION>
Reinsurance:
------------
(In thousands)                              2001       2000
------------------------------------------------------------
<S>                                     <C>         <C>
 Gross premiums written                 $ 520,280   $464,503
 Premiums ceded                           (27,004)   (43,776)
------------------------------------------------------------
 Net premiums written                     493,276    420,727
 Change in unearned premiums             (187,628)  (128,293)
------------------------------------------------------------
 Premiums earned                          305,648    292,434
 Commission and fee income                  3,290      2,768
------------------------------------------------------------
                                          308,938    295,202
------------------------------------------------------------
 Losses and loss expenses                (251,659)  (687,447)
 Commissions, taxes and underwriting
  expenses                                (93,987)   (86,616)
------------------------------------------------------------
                                         (345,646)  (774,063)
------------------------------------------------------------
 Underwriting loss                        (36,708)  (478,861)
------------------------------------------------------------

 Investment loss                           (3,955)    (9,293)

 Gain on sale of PIP                        5,964         --
------------------------------------------------------------
 Reinsurance loss                       $ (34,699) $(488,154)
============================================================
</TABLE>

Underwriting

During the six months ended June 30, 2001, the Company continued with its
transformation into a specialty reinsurance company, focusing on a small number
of specialized products.  Gross premiums written for the six months ended June
30, 2001 reflect $216.1 million of new business and $341.8 million of renewals
compared with $177.6 million and $307.6 million, respectively, for the same
period in the prior year.

Gross reinsurance premiums written increased by $55.8 million for the six months
ended June 30, 2001 compared with the same period in the prior year.  The
increase reflects $117.7 million of gross premiums written by our new
subsidiary, OPUS Re, and $131.3 million of premiums written by our new finite
risk division, of which $43.0 million was new business.

For the six months ended June 30, 2001 gross premiums written for our accident &
health line of business decreased by $13.1 million compared with the same period
in the prior year, primarily as a result of the non-renewal of several programs.
This decrease was partially off-set by $21.5 million of new business written.
We declined to renew several aviation programs and two large workers'
compensation programs as the premium rates did not meet our return requirements.
The programs which we declined to renew contributed $72.8 million towards gross
premiums written during the six months to June 30, 2000.  However, we did write
one new workers' compensation program that generated $18.6 million of premiums
written.  For the six months ended June 30, 2001 this resulted in net decreases
in gross premiums written of $57.0 million and $44.6 million for aviation and
workers' compensation, respectively, compared with the same period in the prior
year.

Our property catastrophe business generated premiums written of $63.5 million
for the six months ended June 30, 2001 compared with $52.2 million for the same
period in the prior year.  We have exposure to earthquakes, hurricanes, storms
and other catastrophic events, all of which are managed through the use of
underwriting controls and occurrence caps as well as modeling, monitoring and
managing accumulations of potential losses.  We also use retrocessional programs
to limit net losses from catastrophes.  However, property catastrophe loss
experience is generally characterized as low frequency but high severity in
nature which may result in volatility in our future financial results.

Premiums attributable to our other property business have decreased by $44.2
million for the six months ended June 30, 2001 compared with the same period for
the prior year, primarily as a result of the non-renewal of several programs and
the return of premium on one account cancelled on a cut off basis.  The programs
which we declined to renew contributed $39.0 million towards gross premiums
written during the six months to June 30, 2000.

Gross premiums written for the six months ended June 30, 2001 also reflect a
decrease in premium estimates for prior years of approximately $37.6 million
compared to $20.7 million for the same period in 2000.

Premiums ceded decreased to $27.0 million for the six months ended June 30, 2001
from $43.8 million for the same period last year. This is mainly due to a
significant decrease in the cost of our aviation excess of loss cover,
reflecting a reduction in our underlying portfolio of aviation business and a
decrease due to the good loss experience in 2000.  Of the premiums ceded of
$27.0 million, $21.4 million relates to reinsurance of our property catastrophe
business where we cede a proportion of the business and we have also entered
into a property catastrophe excess of loss contract

Commission and fee income increased to $3.3 million for the six months ended
June 30, 2001 compared to $2.8 million for the corresponding period in 2000.
This increase is due to $1.5 million in fees earned on our finite risk contracts
that were not accounted for as reinsurance as they do not satisfy the risk
transfer criteria of Statement of Financial Accounting Standards No. 113.  This
was partially offset by the reduction in commission income due to the sale of
PIP in May 2001.
<PAGE>

Reinsurance: (continued)
------------

Our combined ratio, which is the ratio of the sum of losses, loss expenses,
commissions, taxes and other underwriting expenses to earned premiums was 113.1%
for the six months ended June 30, 2001 and we experienced a net underwriting
loss of $36.7 million.   The combined ratio for the six months ended June 30,
2001 was affected by the following factors:

  .    An increase in overhead of approximately $8.8 million following the
       acquisition of OPUS Re and the hiring of a team of finite risk
       underwriters,
  .    A loss of $3.2 million on one of the discontinued financial programs,
  .    Underwriting losses on premiums earned during 2001 but written in prior
       years.

The combined ratio for the six months ended June 30, 2000 was 390.9% and we
experienced a net underwriting loss of $478.9 million. The significant
contributor to the loss in the six months ended June 30, 2000 was reserve
strengthening adjustments of $460 million. The reserve strengthening related
primarily to accident & health, aviation, multi-line, marine and property
programs written during 1997 to 1999.

Reinsurance Investment Income (Loss)

<TABLE>
<CAPTION>
                                               Other
                                                Com-
                                          prehensive
                                  Income      Income         Total      Income
                                  (Loss)      (Loss)        Return      (Loss)
(In thousands)                      2001        2001          2001        2000
--------------------------------------------------------------------------------
<S>                             <C>         <C>           <C>          <C>
  U.S. equities                 $(28,053)   $(19,445)     $(47,498)    $(11,453)
  Emerging market equities         3,130          --         3,130      (19,320)
  Fixed income                     9,984     (34,216)      (24,232)       2,890
  Multi-manager funds              4,900          --         4,900       13,386
  Other                            9,180        (285)        8,895        7,887
  Expenses                        (3,096)         --        (3,096)      (2,683)
--------------------------------------------------------------------------------
                                $ (3,955)   $(53,946)     $(57,901)     $(9,293)
================================================================================
</TABLE>

In an environment of slowing global economies, our portfolio generated a loss of
$57.9 million, for the six months ended June 30, 2001, of which a loss of $4.0
million was recorded in income and an unrealized loss of $53.9 million was
recorded in other comprehensive income compared to a loss of $9.3 million for
the same period in 2000, all of which was recorded in net income.

For the six months ended June 30, 2001 our U.S. equity portfolios which closely
track the S&P 500 index, have generated a loss of 7.3%, or $47.5 million,
consisting of a loss of $28.1 million that was recorded in income and net
unrealized losses of $19.4 million that were recorded in other comprehensive
income compared to a loss of 0.3%, or $11.5 million, for the same period in
2000. For the six months ended June 30, 2001 our fixed income portfolios have
generated a loss of 3.5%, or $24.2 million, consisting of $10.0 million that was
recorded in income and net unrealized losses of $34.2 million that were recorded
in other comprehensive income, compared to income of $2.9 million, or 0.5%, for
the same period in 2000. During the six months ended June 30, 2000 there were no
unrealized gains or losses recorded in other comprehensive income as our U.S.
S&P 500 equity and fixed income portfolios held during that period were trading
investments.

Our emerging markets equity portfolio gained 1.9% for the six months ended June
30, 2001, or $3.1 million, as compared to a loss of $19.3 million, or 8.1% for
the same period in 2000.  Our multi-manager funds, which are primarily a
combination of fixed income strategies, returned $4.9 million for the six months
ended June 30, 2001 compared to $13.4 million for the same period in 2000.  Cash
and cash equivalents earn short-term money market rates which equated to an
annualized return of 5.2% for the six months ended June 30, 2001 compared to
6.5% for the same period in 2000.
<PAGE>

Real Estate and Leasing:
------------------------

<TABLE>
<CAPTION>

(In thousands)                                    2001        2000
------------------------------------------------------------------
<S>                                          <C>         <C>
REVENUE:
Office buildings                             $  46,272   $  77,326
Hotel                                           50,734      51,265
Leasing                                         11,050      11,081
Gain on sale of assets                          35,802          --
------------------------------------------------------------------
                                               143,858     139,672
------------------------------------------------------------------
EXPENSES:
Operating expenses                             (62,563)    (76,221)
Interest expense                               (29,242)    (35,167)
Depreciation                                    (9,783)    (18,734)
Minority interest in earnings                   (2,284)     (1,608)
------------------------------------------------------------------
                                              (103,872)   (131,730)
------------------------------------------------------------------

------------------------------------------------------------------
Operating income                                39,986       7,942
------------------------------------------------------------------

Investment income:
Real estate investment trust certificates        2,385      10,772
Other                                            9,461       9,882
------------------------------------------------------------------
Investment income                               11,846      20,654
------------------------------------------------------------------

------------------------------------------------------------------
Real estate and leasing income               $  51,832   $  28,596
==================================================================
</TABLE>

Office building revenue decreased by 40.2% for the six months ended June 30,
2001 from $77.3 million for the same period in 2000. This decrease of $31.0
million was primarily due to the sales of 333 West Wacker and One Buckhead Plaza
in August 2000, Madison Plaza in February 2001 and the Atlanta Financial Center
in April 2001.  Hotel revenue decreased $0.5 million due to a decrease in room
occupancy rates over the same period in 2000.  Leasing revenue for the six
months ended June 30, 2001 is consistent with the same period last year.

The gain on sale of assets relates primarily to the sales of Madison Plaza in
February 2001 and the Atlanta Financial Center in April 2001.  Madison Plaza was
sold for net cash proceeds of $30.5 million.  The purchaser of the property
assumed the associated existing debt of $122.2 million and the pre-tax gain on
sale was $4.7 million.  However, this gain was net of an impairment expense
recorded in 2000.  The Atlanta Financial Center was sold for net cash proceeds
of $72.8 million.  The purchaser of the property assumed the associated existing
debt of $76.2 million and the pre-tax gain on sale was $30.6 million.  We intend
to take advantage of other sale opportunities in the real estate market when and
as circumstances permit.  The net proceeds from the sale of properties will be
re-deployed into our reinsurance segment.  However there can be no assurances
that such sales will occur in the short-term.

Operating expenses and depreciation have decreased by $13.7 million and $9.0
million, respectively, both of which were primarily due to the sales of the four
office buildings.  Interest expense has decreased by $5.9 million from the same
period in 2000 due to the sales of the four office buildings.  However, this
decrease was partially offset by $2.1 million of interest expense relating to
short-term debt that was obtained to provide temporary working capital.

Investment income decreased by $8.8 million from the same period in 2000
primarily as a result of an $8.4 million decrease in the income from the real
estate investment trusts.  During the quarter ended June 30, 2000 we held 2.9
million shares in these trusts which were valued at $71.5 million compared to
1.3 million shares at June 30, 2001 which were valued at $27.5 million.  This
holding decreased due to the sale of 1.0 million shares in December 2000 and 0.6
million shares in June 2001.

Real estate and leasing income for the six months ended June 30, 2001 increased
by $23.2 million compared to the same period in 2000. This was primarily due to
the gains on the sales of the two buildings mentioned above which was partially
offset by reduced income as two properties were sold in August 2000.
<PAGE>

Net Income:
-----------

<TABLE>
<CAPTION>

(In thousands)                               2001       2000
------------------------------------------------------------
<S>                                      <C>        <C>
NET INCOME (LOSS) BEFORE TAXES
Reinsurance                              $(34,699) $(488,154)
Real estate and leasing                    51,832     28,596
Other operating expenses                   (8,440)    (8,049)
------------------------------------------------------------
Consolidated net income (loss) before
 taxes                                      8,693   (467,607)
Income taxes                              (22,196)    (9,568)
------------------------------------------------------------
Net loss                                 $(13,503) $(477,175)
------------------------------------------------------------
</TABLE>

Net loss for the six months ended June 30, 2001 was $13.5 million compared to a
net loss of $477.2 million for the same period in 2000, a decrease in loss of
$463.7 million.  This decrease was due primarily to the $460 million reserve
strengthening during 2000.  The increase in real estate and leasing income was
primarily due to the gains on sales of office buildings, offset by reduced
revenues following these sales and a reduction in the investment income.  The
tax charge for the six months ended June 30, 2001 was $22.2 million compared to
$9.6 million for the same period in 2000.  This increase of $12.6 million was
due to the tax on the gains on sale of the office buildings.  Net loss per share
was $0.11 for the six months ended June 30, 2001 compared to a loss per share of
$3.68 for the same period in 2000.

Liquidity and Capital Resources
-------------------------------

<TABLE>
<CAPTION>

(In thousands)                          2001        2000
---------------------------------------------------------
<S>                              <C>           <C>
CASH FLOWS
Operating activities              $ 1,310,216   $ 10,393
Investing activities               (1,363,982)    (4,865)
Financing activities                 (229,194)   (99,604)
---------------------------------------------------------
Net decrease in cash and cash
 equivalents                      $  (282,960)  $(94,076)
---------------------------------------------------------
</TABLE>

Cash and cash equivalents decreased due to the following:

Operating activities

Reinsurance operations used $11.8 million for the six months ended June 30, 2001
compared to using $25.9 million for the same period in 2000, due to the timing
of premium receipts and the payment of claims.

Reinsurance receivables and unearned premiums both increased in line with
business being written.  Reinsurance balances payable increased by $48.6 million
as a result of profit commissions payable and deposit liabilities associated
with our new finite risk division.

Real estate operations generated $5.2 million for the six months ended June 30,
2001 compared to generating $24.4 million for the same period in 2000.  The
reduction was primarily due to reduced cashflows following the sales of the four
office buildings and increased payments of tax relating to these sales.

During the six months ended June 30, 2001 we received $35.9 million of interest
and dividends, purchased $1,401.7 million of traded investments and sold
$2,689.9 million of investments in our trading portfolio compared to $33.8
million, $549.9 million and $536.0 million, respectively, for the same period in
2000.  These cashflows were primarily as a result of selling our U.S. S&P 500
equity based and our global bond portfolios during March 2001. Following the
sale of our U.S. S&P 500 equity based portfolio we purchased Standard & Poor's
Depositary Receipts ('SPDRs') to mitigate our exposure to market risk. The
SPDRs were sold to finance the purchase of available-for-sale securities.

The sale of the trading securities reflects the change in nature of our
operations and the significant growth in our loss reserves following the
cancellation of our shipper's risk business in October 1999 and our
diversification into other reinsurance lines.

Property catastrophe business, written by our subsidiary, Overseas Partners Cat
Ltd. has loss experience characterized as low frequency and high severity.  This
may result in volatility in both the Company's results and operational cash
flows.  Property catastrophe losses are generally notified and paid within a
short period of time from the covered event.
<PAGE>

Investing activities

During the six months ended June 30, 2001 we have purchased $2,423.0 million and
sold $924.6 million of investments in our available-for-sale portfolios.

During the six months ending June 30, 2001 our real estate investing activities
produced net cash inflow of $104.6 million.  This primarily consisted of $30.5
from the sale of Madison Plaza and $72.8 from the sale of the Atlanta Financial
Center.  The purchasers of both properties assumed the associated existing debt
of $122.2 million and $76.2 million, respectively.  We intend to take advantage
of other sale opportunities in the real estate market when and as circumstances
permit.  The net proceeds from the sale of properties will be re-deployed into
our reinsurance segment.

Our reinsurance investing activities produced net cash inflow of $22.4 million
following the sale of our independent insurance agent PIP.

Financing activities

During the six months ended June 30, 2001 the Company repaid $135.0 million of
unsecured short-term debt primarily with the net proceeds from the sales of
Madison Plaza and the Atlanta Financial Center.

On March 8, 2001, we paid a dividend of $0.45 per share resulting in a cash
outflow of $54.1 million, compared to a dividend of $0.60 per share totaling
$74.2 million paid in March 2000.

Subsequent to the quarter, on August 8, 2001 the board declared a dividend of
$0.25 per share to be paid on August 22, 2001 compared to declaring a dividend
of $0.60 per share on August 9, 2000 that was paid on August 25, 2000.

During the six months ended June 30, 2001 we purchased $32.3 million of shares
from our shareowners compared to $19.2 million for the same period in 2000.

In November 1999, the Board announced that it would limit the number of shares
of our Common Stock that we were willing to purchase from any shareowners
seeking to sell such shares between November 23, 1999 and November 1, 2000.
During such period, we were willing to purchase up to 10% of the shares of our
Common Stock held by any shareowner as of November 23, 1999.  During November
2000 the Board decided to extend the limit of the number of shares that we would
be willing to purchase from any shareowner seeking to sell such shares between
November 1, 2000 and December 31, 2001.  Accordingly, during such period, we
were willing to purchase up to 10% of the shares of our Common Stock held by any
shareowner as of November 2, 2000.

In addition, in order to reduce the cost and administrative inefficiency
associated with the existence of shareowners owning a small number of shares,
during May 2001 the Board determined that OPL was willing to purchase 100% of
the shares of common stock from those shareowners that owned 100 shares or less
as of November 1, 2000.

However, following its meeting on August 8, 2001 the Board of Directors
announced that the Company is suspending the current repurchase of shares of the
Company's Common Stock, effective August 8, 2001.  This was necessitated by the
need to demonstrate to the Company's customers, insurance regulators and rating
agencies that it is able to maintain a strong and stable capital base.  This
decision will be re-evaluated at future Board meetings, giving due consideration
to relevant capital levels, operating performance, cash flows and future needs.

Inflation

Our investment policies are designed to achieve enhanced returns to shareowners,
measured over conventional medium to long-term market cycle periods.  Our fixed
income portfolio comprises highly liquid debt securities of governments,
supranationals, government agencies, financial institutions and utilities.  Our
U.S. and emerging markets equity portfolios are comprised of stocks drawn mainly
from within the S&P 500 Index and the IFC Index.  Because the liquidity of our
investments permits us to respond quickly to changing market conditions, our
investments are not significantly affected by inflation.  Inflation, including
damage awards and costs, can substantially increase the ultimate cost of claims
in certain types of insurance.  This is because the actual payment of claims may
take place a number of years after the provisions for losses are reflected in
the financial statements.  We will, on the other hand, earn income on the funds
retained for a period of time until eventual payment of a claim.
<PAGE>

Sources of capital and liquidity

OPL's U.S. based reinsurance subsidiary, OPUS Re, is subject to regulations that
include restrictions that limit the amount of dividends or other distributions,
such as loans or cash advances, available to shareowners without prior approval
of the insurance regulatory authorities.  Any dividends or other distributions
from OPUS Re to OPL via OPUS Re's holding company would be subject to 30%
withholding taxes.

We intend to take advantage of other sale opportunities in the real estate
market when and as circumstances permit.  The net proceeds from the sale of
properties will be re-deployed into our reinsurance segment.  However there can
be no assurances that such sales will occur in the short-term.

We believe that our Bermuda investments, cash flow from operations and borrowing
ability are adequate sources of capital and liquidity for the payment of claims,
operating expenses and dividends.  We further believe that our strong capital
position will permit expansion of our reinsurance business, should appropriate
opportunities arise.  In the event we decide to purchase additional capital
assets, we may, as demonstrated by our existing portfolio of assets, finance
such purchases from internally generated funds or from outside borrowing which
we believe would be readily available to us.

Recent Developments
-------------------

As discussed in the Taxation section of our Form 10-K for the year ended
December 31, 2000 ("2000 10-K"), under the passive foreign investment company
("PFIC") rules, a United States shareowner of OPL would be subject to rules
designed to approximate current taxation of the earnings of OPL if at least 75%
of the gross income of OPL was "passive income," or if at least 50% of the
average assets of OPL were to produce, or were held for the production of,
"passive income".  During the second quarter of 2000, as reported in the
Taxation section of the 2000 10-K, OPL was advised by the IRS of the existence
of an internal IRS memorandum that concludes, consistent with a 1999 United
States Tax Court opinion involving UPS, that shipper's risk reinsurance premiums
received by OPL were not income of OPL and that the associated investment income
was not "active income" for purposes of the PFIC rules.  The significance of the
internal IRS memorandum recently became more uncertain, however, because the
United States Court of Appeals for the Eleventh Circuit reversed the decision of
the United States Tax Court in the UPS case during June 2001 and remanded the
case to the Tax Court for further review.  A Petition for Rehearing was filed
with the Court of Appeals for the Eleventh Circuit in early August 2001, and it
remains unclear how the issue ultimately will be resolved.

Safe Harbor Disclosure
----------------------

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements.  Some of the statements contained in this
Securities and Exchange Commission filing contain forward-looking information.
Forward-looking statements are statements other than historical information or
statements of current condition.  Some forward looking statements can be
identified by the use of such words as "expect," "believe," "goal," "plan,"
"intend," "estimate," "may" and "will" or similar words.  These forward-looking
statements relate to our plans and objectives for future operations including
our growth and operating strategy, our implementation of new products and new
reinsurance programs, trends in our industry and our policy on future dividends.

You should be aware that these statements are subject to risks, uncertainties
and other factors, that could cause the actual results to differ materially from
those suggested by the forward-looking statements.  Accordingly, there can be no
assurance that those indicated results will be realized.  Among the important
factors that could cause actual results to differ materially from those
indicated by our forward-looking statements are:

  . our ability to replace, with profitable business, the revenues that we
    derived in the past from reinsurance of excess value package insurance
    associated with the business of UPS.
  . pricing pressure resulting from the competitive environment in which we
    operate
  . ability to collect reinsurance recoverables
  . the uncertainties of the reserving process
  . the occurrence of catastrophic events with a frequency or severity exceeding
    our estimates
  . loss of the services of any of the Company's executive officers
  . uncertainties relating to government and regulatory policies (such as
    subjecting us to insurance regulation or taxation in certain jurisdictions)
  . losses due to interest rate fluctuations
  . volatility in global financial markets which has in recent periods
    significantly affected and may continue to significantly affect the value of
    our investment portfolio
  . the resolution of any pending or future tax assessments by the IRS against
    us
  . the resolution of other pending litigation
  . the impact of mergers and acquisitions
  . our ability to integrate new businesses and significant new staff with our
    existing operations.

We do not undertake to update these forward-looking statements in any manner.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk
         ----------------------------------------------------------

There has been no material change in the Company's market risks in 2001.
<PAGE>

                    OVERSEAS PARTNERS LTD. AND SUBSIDIARIES
                          PART II, OTHER INFORMATION


Item 1.   Legal Proceedings
          -----------------

See Notes 3 and 6 to the Financial Statements for discussions of current legal
proceedings to which OPL are a party.

Item 6 - Exhibits and Reports on Form 8-K
         --------------------------------

a)  Exhibits:  None
    --------

b)  Reports on Form 8-K:  The Company filed reports on Form 8-K on June 28, 2001
    -------------------
and August 9, 2001, attaching letters to shareowners presenting summaries of the
Company's first quarter 2001 results and second quarter 2001 results,
respectively.
<PAGE>

                                   SIGNATURES
                                   ----------


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on behalf by the
undersigned, thereunto duly authorized.



Date:  August 14, 2001           OVERSEAS PARTNERS LTD.



                                 By: /s/ Mary R. Hennessy
                                     -----------------------------------------
                                     Mary R. Hennessy
                                     Chief Executive Officer and President


                                 By: /s/ Mark R. Bridges
                                     ------------------------------------------
                                     Mark R. Bridges
                                     Chief Financial Officer and Executive
                                     Vice-President
                                     (Chief Accounting Officer)