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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10  Q

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

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For Quarter Ended September 30, 2002

Commission file Number 0-11538

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

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| | Islands of Bermuda(State or other jurisdiction ofincorporation or organization) |  | N/A(I.R.S. EmployerIdentification No.) | 
| | ------------------------------------------------------------------------------- |  | -------------------------------------- | 

| | Cumberland House, One Victoria Street, Hamilton HM 11, Bermuda(Address of principal executive offices) |  | (Zip Code) | 
| | ------------------------------------------------------------------------------------------------------ |  | ---------- | 

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

Not ApplicableFormer
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 o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

YES x NO o

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

118,855,342 SharesOutstanding at November 13, 2002

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PART I. FINANCIAL INFORMATIONOVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED CONSOLIDATED
BALANCE SHEETS(In thousands, except share and per share amounts)

|                                                                                                                                        |  | September 30,2002 |           | December 31,2001 |  
|--------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | --------- | ---------------- | -
|                                                                                                                                        |  |                   |           |                  |  
|                                                                                                                                        |  | (Unaudited)       |           | (Audited)        |  
|                                                                                                                                        |  |                   |           |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|ASSETS:                                                                                                                                 |  |                   |           |                  |  
|Investments:                                                                                                                            |  |                   |           |                  |  
|Trading, at fair value                                                                                                                 |  |                   |           |                  |  
|Equity securities (cost 2002  $450,500, 2001  $453,523)                                                                               |  | $                 | 511,671   |                  | $
|Available-for-sale, at fair value                                                                                                      |  |                   |           |                  |  
|Debt securities (amortized cost 2002  $365,707, 2001  $835,962)                                                                       |  |                   | 369,346   |                  |  
|Restricted debt securities (amortized cost 2002  $577,181, 2001  $nil)                                                                |  |                   | 612,420   |                  |  
|Equity securities (cost 2002  $277,299, 2001  $665,898)                                                                               |  |                   | 275,252   |                  |  
|Held-to-maturity, at amortized cost                                                                                                    |  |                   |           |                  |  
|Restricted investments (fair value 2002  $nil, 2001  $279,581)                                                                        |  |                   |          |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|                                                                                                                                        |  |                   | 1,768,689 |                  |  
|Cash and cash equivalents                                                                                                               |  |                   | 404,217   |                  |  
|Restricted cash and cash equivalents                                                                                                    |  |                   | 359,000   |                  |  
|Reinsurance balances receivable                                                                                                         |  |                   | 639,675   |                  |  
|Funds withheld                                                                                                                          |  |                   | 313,473   |                  |  
|Deferred acquisition costs                                                                                                              |  |                   | 46,446    |                  |  
|Unearned premiums ceded                                                                                                                 |  |                   | 5,113     |                  |  
|Real estate and leasing:                                                                                                                |  |                   |           |                  |  
|Operating lease with UPS                                                                                                                |  |                   |          |                  |  
|Finance lease                                                                                                                           |  |                   | 41,466    |                  |  
|Hotel                                                                                                                                   |  |                   |          |                  |  
|Office building                                                                                                                         |  |                   |          |                  |  
|Other assets                                                                                                                            |  |                   |           |                  |  
|Goodwill                                                                                                                                |  |                   | 3,333     |                  |  
|Other                                                                                                                                   |  |                   | 67,567    |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|Total assets                                                                                                                            |  | $                 | 3,648,979 |                  | $
|                                                                                                                                        |  |                   |           |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|LIABILITIES AND MEMBERS EQUITY:                                                                                                        |  |                   |           |                  |  
|Liabilities:                                                                                                                            |  |                   |           |                  |  
|Accrued losses and loss expenses                                                                                                        |  | $                 | 1,721,825 |                  | $
|Unearned premiums                                                                                                                       |  |                   | 308,353   |                  |  
|Reinsurance balances payable                                                                                                            |  |                   | 272,571   |                  |  
|Accounts payable and other liabilities                                                                                                  |  |                   | 44,383    |                  |  
|Deferred income taxes                                                                                                                   |  |                   | 3,123     |                  |  
|Long-term debt                                                                                                                          |  |                   | 100,876   |                  |  
|Minority interest                                                                                                                       |  |                   |          |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|Total liabilities                                                                                                                       |  | $                 | 2,451,131 |                  | $
|                                                                                                                                        |  |                   |           |                  |  
|Commitments and contingencies                                                                                                           |  |                   |          |                  |  
|Preference Stock, par value $0.10 per share; authorized 200 million shares;none     issued                                              |  |                   |          |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|Members equity:                                                                                                                        |  |                   |           |                  |  
|Common Stock, par value $0.10 per share; authorized 900 million shares; issued     127.5 million shares; outstanding 118,855,342 shares |  |                   | 12,750    |                  |  
|Contributed surplus                                                                                                                     |  |                   | 37,650    |                  |  
|Retained earnings                                                                                                                       |  |                   | 1,295,255 |                  |  
|Treasury stock (2002  8,644,658 shares, 2001  8,406,081 shares), at cost                                                              |  |                   | (158,047  | )                |  
|Deferred compensation                                                                                                                   |  |                   | (556      | )                |  
|Accumulated other comprehensive gain (loss)                                                                                             |  |                   | 10,796    |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|Total members equity                                                                                                                   |  |                   | 1,197,848 |                  |  
|                                                                                                                                        |  |                   |           |                  |  
|Total liabilities and members equity                                                                                                   |  | $                 | 3,648,979 |                  | $
|                                                                                                                                        |  |                   |           |                  |  
|Net book value per share                                                                                                                |  | $                 | 10.08     |                  | $
|                                                                                                                                        |  |                   |           |                  |  

See condensed notes to unaudited consolidated financial statements.



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

|                                                  |  | Three Months Ended September 30, |          | Nine Months Ended September 30, |  
|------------------------------------------------- |  | -------------------------------- | -------- | ------------------------------- | -
|                                                  |  |                                  |          |                                 |  
|                                                  |  | 2002                             |          | 2001                            |  
|                                                  |  |                                  |          |                                 |  
|REVENUES:                                         |  |                                  |          |                                 |  
|Gross reinsurance premiums written                |  | $                                | (175,304 | )                               | $
|Reinsurance premiums ceded                        |  |                                  | 476      |                                 |  
|                                                  |  |                                  |          |                                 |  
|Reinsurance premiums written                      |  |                                  | (174,828 | )                               |  
|Change in unearned premiums                       |  |                                  | 242,508  |                                 |  
|                                                  |  |                                  |          |                                 |  
|Reinsurance premiums earned                       |  |                                  | 67,680   |                                 |  
|Commission and fee income                         |  |                                  | 2,685    |                                 |  
|Operating lease with UPS                          |  |                                  |         |                                 |  
|Finance lease                                     |  |                                  | 839      |                                 |  
|Hotel                                             |  |                                  |         |                                 |  
|Office buildings                                  |  |                                  | 3,751    |                                 |  
|Gain on sales of real estate assets and PIP       |  |                                  | 34,211   |                                 |  
|Interest                                          |  |                                  | 12,962   |                                 |  
|Realized loss on securities                       |  |                                  | (180,524 | )                               |  
|Unrealized loss on trading securities             |  |                                  | (1,977   | )                               |  
|Amortization of fixed income securities           |  |                                  | (484     | )                               |  
|Dividends                                         |  |                                  | 1,014    |                                 |  
|                                                  |  |                                  |          |                                 |  
|                                                  |  |                                  | (59,843  | )                               |  
|                                                  |  |                                  |          |                                 |  
|                                                  |  |                                  |          |                                 |  
|EXPENSES:                                         |  |                                  |          |                                 |  
|Reinsurance losses and loss expenses              |  |                                  | 110,303  |                                 |  
|Reinsurance commissions, taxes and other          |  |                                  | 15,358   |                                 |  
|Depreciation expense                              |  |                                  | 514      |                                 |  
|Real estate and leasing operating expenses        |  |                                  | 2,558    |                                 |  
|Interest expense                                  |  |                                  | 3,029    |                                 |  
|Minority interest in earnings                     |  |                                  | 205      |                                 |  
|Investment expenses                               |  |                                  | 680      |                                 |  
|Impairment / amortization of goodwill             |  |                                  |         |                                 |  
|Other operating expenses                          |  |                                  | 4,052    |                                 |  
|                                                  |  |                                  |          |                                 |  
|                                                  |  |                                  | 136,699  |                                 |  
|                                                  |  |                                  |          |                                 |  
|                                                  |  |                                  |          |                                 |  
|Loss before income taxes                          |  |                                  | (196,542 | )                               |  
|Income taxes                                      |  |                                  | (14,310  | )                               |  
|                                                  |  |                                  |          |                                 |  
|Net loss                                          |  | $                                | (210,852 | )                               | $
|                                                  |  |                                  |          |                                 |  
|                                                  |  |                                  |          |                                 |  
|Basic and diluted net loss per share              |  | $                                | (1.77    | )                               | $
|                                                  |  |                                  |          |                                 |  
|Weighted average number of shares     outstanding |  |                                  | 118,870  |                                 |  
|                                                  |  |                                  |          |                                 |  

See condensed notes to unaudited consolidated financial statements.



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

|                                                                                     |  | Three Months Ended September 30, |          | Nine Months Ended September 30, |  
|------------------------------------------------------------------------------------ |  | -------------------------------- | -------- | ------------------------------- | -
|                                                                                     |  |                                  |          |                                 |  
|                                                                                     |  | 2002                             |          | 2001                            |  
|                                                                                     |  |                                  |          |                                 |  
|Net loss                                                                             |  | $                                | (210,852 | )                               | $
|                                                                                     |  |                                  |          |                                 |  
|Other comprehensive gain (loss):                                                     |  |                                  |          |                                 |  
|Net unrealized holding losses on     available-for-sale securities                   |  |                                  | (65,682  | )                               |  
|Less: reclassification adjustment for losses     (gains) included in net income      |  |                                  | 180,606  |                                 |  
|                                                                                     |  |                                  |          |                                 |  
|Other comprehensive gain (loss) before     income tax                                |  |                                  | 114,924  |                                 |  
|                                                                                     |  |                                  |          |                                 |  
|Income tax recovery (payable) related to     other comprehensive (loss) income items |  |                                  | 279      |                                 |  
|                                                                                     |  |                                  |          |                                 |  
|Other comprehensive gain (loss)                                                      |  |                                  | 115,203  |                                 |  
|                                                                                     |  |                                  |          |                                 |  
|                                                                                     |  |                                  |          |                                 |  
|Comprehensive loss                                                                   |  | $                                | (95,649  | )                               | $
|                                                                                     |  |                                  |          |                                 |  

See condensed notes to unaudited consolidated financial statements.



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF MEMBERS EQUITYNine Months Ended September 30, 2002 and 2001(In thousands)(Unaudited)

|                                                                      |  |                 |   | Common Stock |  | Treasury Stock |  |        |        |        |  |                      |   |                    |          |                  |  
|--------------------------------------------------------------------- |  | --------------- | - | ------------ |  | -------------- |  | ------ | ------ | ------ |  | -------------------- | - | ------------------ | -------- | ---------------- | -
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|                                                                      |  | PreferenceStock |   | Shares       |  | Amount         |  | Shares |        | Amount |  | DeferredCompensation |   | ContributedSurplus |          | RetainedEarnings |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Balance, January 1, 2001                                              |  | $               |  |              |  | 127,500        |  | $      | 12,750 |        |  | (6,563               | ) | $                  | (125,379 | )                | $
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Net loss                                                              |  |                 |  |              |  |               |  |        |       |        |  |                     |   |                    |         |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Purchase of shares                                                    |  |                 |  |              |  |               |  |        |       |        |  | (2,279               | ) |                    | (38,732  | )                |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Treasury shares issued for restricted     common stock compensation   |  |                 |  |              |  |               |  |        |       |        |  | 447                  |   |                    | 8,864    |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Amortization of restricted common     stock compensation              |  |                 |  |              |  |               |  |        |       |        |  |                     |   |                    |         |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Dividend paid ($0.70 per share)                                       |  |                 |  |              |  |               |  |        |       |        |  |                     |   |                    |         |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Net unrealized loss on available-     for-sale securities, net of tax |  |                 |  |              |  |               |  |        |       |        |  |                     |   |                    |         |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Balance, September 30, 2001                                           |  | $               |  |              |  | 127,500        |  | $      | 12,750 |        |  | (8,395               | ) | $                  | (155,247 | )                | $
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Balance, January 1, 2002                                              |  | $               |  |              |  | 127,500        |  | $      | 12,750 |        |  | (8,406               | ) | $                  | (155,406 | )                | $
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Net loss                                                              |  |                 |  |              |  |               |  |        |       |        |  |                     |   |                    |         |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Restricted shares forfeited                                           |  |                 |  |              |  |               |  |        |       |        |  | (1                   | ) |                    | (19      | )                |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Purchase of shares                                                    |  |                 |  |              |  |               |  |        |       |        |  | (238                 | ) |                    | (2,622   | )                |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Amortization of restricted common     stock compensation              |  |                 |  |              |  |               |  |        |       |        |  |                     |   |                    |         |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Net unrealized gain on available-     for-sale securities, net of tax |  |                 |  |              |  |               |  |        |       |        |  |                     |   |                    |         |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  
|Balance, September 30, 2002                                           |  | $               |  |              |  | 127,500        |  | $      | 12,750 |        |  | (8,645               | ) | $                  | (158,047 | )                | $
|                                                                      |  |                 |   |              |  |                |  |        |        |        |  |                      |   |                    |          |                  |  



See condensed notes to unaudited consolidated financial statements.









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

|                                                                                           |  | Nine Months Ended September 30, |           
|------------------------------------------------------------------------------------------ |  | ------------------------------- | ----------
|                                                                                           |  |                                 |           
|                                                                                           |  | 2002                            |           
|                                                                                           |  |                                 |           
|CASH FLOW FROM OPERATING ACTIVITIES:                                                       |  |                                 |           
|Net loss                                                                                   |  | $                               | (210,811  
|Adjustments to reconcile net loss to net cash (expended) provided by operating activities: |  |                                 |           
|Deferred income taxes                                                                      |  |                                 | (12,874   
|Depreciation expense                                                                       |  |                                 | 9,037     
|Minority interest in earnings                                                              |  |                                 | 2,025     
|Realized loss (gain) on securities                                                         |  |                                 | 172,412   
|Unrealized loss on trading securities                                                      |  |                                 | 1,406     
|Amortization of fixed income securities                                                    |  |                                 | (5,440    
|Amortization of restricted common stock compensation                                       |  |                                 | 2,540     
|Gain on sales of real estate assets and PIP                                                |  |                                 | (140,203  
|Premium on debt repurchase                                                                 |  |                                 | 78,001    
|Other                                                                                      |  |                                 | (1,149    
|Changes in assets and liabilities:                                                         |  |                                 |           
|Reinsurance balances receivable                                                            |  |                                 | (23,891   
|Funds withheld                                                                             |  |                                 | (112,702  
|Deferred acquisition costs                                                                 |  |                                 | 13,772    
|Unearned premiums ceded                                                                    |  |                                 | (69,359   
|Other assets                                                                               |  |                                 | 30,096    
|Accrued losses and loss expenses                                                           |  |                                 | (60,178   
|Unearned premiums                                                                          |  |                                 | 99,570    
|Reinsurance balances payable                                                               |  |                                 | 106,517   
|Accounts payable and other liabilities                                                     |  |                                 | (22,729   
|Proceeds from sale of trading investments                                                  |  |                                 | 3,689     
|Purchase of trading investments                                                            |  |                                 | (1,346    
|                                                                                           |  |                                 |           
|Net cash flow (expended) provided by operating activities                                  |  |                                 | (141,617  
|                                                                                           |  |                                 |           
|                                                                                           |  |                                 |           
|CASH FLOW FROM INVESTING ACTIVITIES:                                                       |  |                                 |           
|Proceeds from sales and maturities of available-for-sale investments                       |  |                                 | 1,620,453 
|Purchase of available-for-sale investments                                                 |  |                                 | (1,194,260
|Proceeds from sales and maturities of held-to-maturity investments                         |  |                                 | 11,270    
|Purchase of held-to-maturity investments                                                   |  |                                 | (84,192   
|Purchase of restricted cash and cash equivalents, net                                      |  |                                 | (359,000  
|Net cash outflow from sale of Overseas Partners Cat Ltd.                                   |  |                                 | (38,632   
|Net proceeds from sales of real estate assets and PIP                                      |  |                                 | 372,567   
|Additions to real estate and leasing assets                                                |  |                                 | (11,517   
|                                                                                           |  |                                 |           
|Net cash flow generated (expended) by investing activities                                 |  |                                 | 316,689   
|                                                                                           |  |                                 |           
|                                                                                           |  |                                 |           
|CASH FLOW FROM FINANCING ACTIVITIES:                                                       |  |                                 |           
|Purchases of treasury stock                                                                |  |                                 | (2,622    
|Repayment and repurchase of debt                                                           |  |                                 | (251,920  
|Distributions to minority interest                                                         |  |                                 | (2,215    
|Dividends paid                                                                             |  |                                 |          
|                                                                                           |  |                                 |           
|Net cash flow expended by financing activities                                             |  |                                 | (256,757  
|                                                                                           |  |                                 |           
|                                                                                           |  |                                 |           
|Net decrease in cash and cash equivalents                                                  |  |                                 | (81,685   
|Cash and cash equivalents:                                                                 |  |                                 |           
|Beginning of period                                                                        |  |                                 | 485,902   
|                                                                                           |  |                                 |           
|End of period                                                                              |  | $                               | 404,217   
|                                                                                           |  |                                 |           
|                                                                                           |  |                                 |           
|Supplemental disclosures of cash flow information:                                         |  |                                 |           
|Cash paid during the period:                                                               |  |                                 |           
|U.S. income taxes                                                                          |  | $                               | 37,715    
|Interest                                                                                   |  | $                               | 24,528    
|Assignment of debt in partial consideration for sales of real estate assets                |  | $                               | 281,301   
|                                                                                           |  |                                 |           

See condensed notes to unaudited consolidated financial statements.



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTSSEPTEMBER 30,
2002(Unaudited)

1.      GENERAL

The accompanying unaudited interim
condensed consolidated financial statements include the accounts of Overseas Partners Ltd. and its subsidiaries (collectively OPL or the Company). OPL is engaged in the property, casualty and finite risk reinsurance business and in the real estate
and leasing business. On February 13, 2002 the Board of Directors of OPL announced its decision to restructure OPL and cause its operations to begin an orderly runoff. OPL and its reinsurance subsidiaries have discontinued writing new business. OPL
has continued to dispose of its real estate assets such that as of September 30, 2002 OPL has only one remaining leased asset.

The decision to put the reinsurance operations into runoff will significantly change
the future results of our operations and the associated cash flows. There will be no new business written, therefore the cash received for premiums will significantly decrease. We have become cash flow negative in our reinsurance operations and we
expect this to continue over the next few years. Nevertheless, we believe that our current cash holdings and future sales and maturities of investments are adequate sources of liquidity for the future payment of claims and operating
expenses.

The results of operations for the three and nine-month periods ended September 30, 2002 and 2001 are not necessarily indicative of the results to be expected for the full year.

2.      SIGNIFICANT ACCOUNTING POLICIES

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, 2001.

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.

Except as described above, 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.

Investments are reviewed periodically to determine if they have sustained an impairment of value that is considered to be
other than temporary. The identification of potentially impaired investments and the assessment of whether any decline in value is other than temporary involves significant management judgment. If investments are determined to be impaired, the cost
basis of the investment is written down to fair value at the balance sheet date and a corresponding realized loss is charged to the income statement in the period in which it is determined.

On July 20, 2001, the
Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets (SFAS 142). This Statement made significant changes to the accounting for goodwill and intangible
assets. 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
has adopted this standard effective January 1, 2002 and the impact on its financial statements is not material.

The Company tests goodwill for impairment on an annual basis and between annual tests if certain
indicators are encountered. During the nine months ended September 30, 2002 the Company reviewed goodwill for impairment, resulting in a $2.5 million write-off of goodwill.

In October 2001, the Financial
Accounting Standards Board issued Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (SFAS 144), which supersedes Statement of Financial Accounting Standards No. 121 (SFAS
121). SFAS 144 addresses financial accounting and reporting for the impairment of long-lived assets and for long-lived assets to be disposed of. However, SFAS 144 retains the fundamental provisions of SFAS 121 for recognition and measurement of the
impairment of long-lived assets to be held and used and measurement of long-lived assets to be disposed of by sale. The Company has adopted this standard effective January 1, 2002 and the impact on its financial statements is not
material.



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTSSEPTEMBER 30,
2002(Unaudited)

2.      SIGNIFICANT ACCOUNTING POLICIES(continued)

Long-lived assets held for use are assessed for impairment under SFAS 144 whenever a trigger event occurs. The impairment test is based on whether estimated future undiscounted cash flow from such assets on an individual
basis will be less than their net carrying value. If an asset is impaired, its basis is adjusted to fair market value, (net of expected costs to sell), and any such adjustment is recorded as part of depreciation and impairment expense in the
consolidated statement of income. No such impairment was booked in the period ended September 30, 2002.

3.      SALE OF
SUBSIDIARY

On May 10, 2002 OPL sold its wholly owned subsidiary Overseas Partners Cat Ltd. (OPCat) to Renaissance Re Holdings Ltd for $25 million. Prior to, and in anticipation of, the sale, OPCat
returned approximately $420 million of capital to OPL. The sale proceeds of $25 million were equal to OPCats net book value at the date of sale. At the date of sale OPCats assets included $63.6 million of cash, therefore the sale
resulted in a net cash outflow of $38.6 million. OPL remains liable for adverse development on losses incurred prior to February 13, 2002 and, conversely, is entitled to a profit commission for any favorable development.

4.      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 carries on business through a permanent establishment in the United States. Therefore, it does not expect itself or its Bermuda subsidiaries to be subject to
United States 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 United States 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 United States 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, although a Notice of Proposed Adjustment, reflecting similar positions, has been issued recently by the IRS in connection with the audit of the years 1995 through 1998. The IRS also may take
similar positions for the 1999 year pending resolution of the years currently in dispute.

Overseas Partners Ltd. believes that it has no tax liability, that it is not subject to United States 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.

In connection with a related Tax Court case involving UPS, pursuant to mediation conducted by a judge of the Tax Court, a tentative basis for settlement recently has been reached which could result in the substantial
reduction of the liabilities asserted against OPL, although some amount of asserted liability may remain in dispute following any finalization of such settlement. The final terms of the settlement remain under negotiation, and there can be no
assurance that the tentative basis for settlement will not materially change, or that it or any other settlement ultimately will be approved or finalized.

Certain of OPLs subsidiaries are incorporated in
the United States, including Overseas Partners Capital Corp. (OPCC) and Overseas Partners US Reinsurance Company (OPUS Re). These subsidiaries are subject to United States income taxes.



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTSSEPTEMBER 30,
2002(Unaudited)

5.      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 United States subsidiaries) and includes the runoff of 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 United States subsidiaries
of OPCC, a wholly-owned subsidiary of Overseas Partners Ltd. There were no inter-segment revenues earned for the three and nine-month periods ended September 30, 2002 and 2001. Inter-segment expenses, such as corporate overhead, were allocated based
on estimated utilization for the three and nine-month periods ended September 30, 2002 and 2001.

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, 2001. 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. At September 30, 2002 the portfolio included $853.5
million (December 31, 2001 - $ nil) of cash and investments that are restricted and are used to collateralize obligations to our cedants. Investments relating to real estate and leasing are primarily restricted and used to collateralize long-term
debt originally issued in connection with the purchase of assets held for leasing. Summary financial information about the Companys segments is presented in the following table:

|                          |  | Three months ended September 30, |          | Nine months ended September 30, |  
|------------------------- |  | -------------------------------- | -------- | ------------------------------- | -
|                          |  |                                  |          |                                 |  
|(In thousands)            |  | 2002                             |          | 2001                            |  
|                          |  |                                  |          |                                 |  
|REVENUES                  |  |                                  |          |                                 |  
|Reinsurance:              |  |                                  |          |                                 |  
|Premiums earned           |  | $                                | 67,680   |                                 | $
|Commission and fee income |  |                                  | 2,685    |                                 |  
|Gain on sale of PIP       |  |                                  |         |                                 |  
|Investment loss           |  |                                  | (170,923 | )                               |  
|                          |  |                                  |          |                                 |  
|                          |  |                                  | (100,558 | )                               |  
|                          |  |                                  |          |                                 |  
|Real estate and leasing:  |  |                                  |          |                                 |  
|Rentals                   |  |                                  | 4,590    |                                 |  
|Gain on sale of assets    |  |                                  | 34,211   |                                 |  
|Investment income         |  |                                  | 1,914    |                                 |  
|                          |  |                                  |          |                                 |  
|                          |  |                                  | 40,715   |                                 |  
|                          |  |                                  |          |                                 |  
|Consolidated              |  |                                  | (59,843  | )                               |  
|                          |  |                                  |          |                                 |  
|                          |  |                                  |          |                                 |  
|NET LOSS BEFORE TAXES     |  |                                  |          |                                 |  
|Reinsurance               |  |                                  | (226,899 | )                               |  
|Real estate and leasing   |  |                                  | 34,409   |                                 |  
|Other operating expenses  |  |                                  | (4,052   | )                               |  
|                          |  |                                  |          |                                 |  
|Consolidated              |  | $                                | (196,542 | )                               | $
|                          |  |                                  |          |                                 |  

|(In thousands)          |  | September 30,2002 |           | December 31, 2001(Audited) |  
|----------------------- |  | ----------------- | --------- | -------------------------- | -
|                        |  |                   |           |                            |  
|ASSETS                  |  |                   |           |                            |  
|Reinsurance             |  |                   |           |                            |  
|Cash and investments    |  | $                 | 2,381,641 |                            | $
|Other                   |  |                   | 1,072,967 |                            |  
|                        |  |                   |           |                            |  
|                        |  |                   | 3,454,608 |                            |  
|                        |  |                   |           |                            |  
|Real estate and leasing |  |                   |           |                            |  
|Cash and investments    |  |                   | 150,265   |                            |  
|Other                   |  |                   | 44,106    |                            |  
|                        |  |                   |           |                            |  
|                        |  |                   | 194,371   |                            |  
|                        |  |                   |           |                            |  
|Consolidated            |  | $                 | 3,648,979 |                            | $
|                        |  |                   |           |                            |  

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. The Companys long-lived assets also include $5.8 million relating to the capitalized cost of insurance licenses owned by OPUS Re and goodwill of $3.3 million relating to the Companys 22% ownership of a Florida based
workers compensation insurance company.



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTSSEPTEMBER 30,
2002(Unaudited)

5.      BUSINESS SEGMENTS(continued)

For the nine-month periods ended September 30, 2002 and 2001 approximately 89% and 75%, respectively, 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 2002 and 2001, all of the Companys long-lived assets were located in the United
States.

OPL earned premiums of $4.7 million for the three months ended September 30, 2001 and $14.0 million for the nine months ended September 30, 2001 for the reinsurance of workers compensation
insurance, written by Liberty Mutual Insurance Company, for employees of a United Parcel Service, Inc. (UPS) subsidiary located in the State of California. This contract was not renewed in 2002.

Until January
31, 2002 OPLs real estate and leasing segment included a data processing facility leased to a UPS subsidiary. UPS had an option to purchase the building in which the data processing facility is located at the higher of fair market value or a
settlement value, as defined in the lease agreement, prevailing at that time. On September 21, 2001 UPS notified the Company of their election to terminate the data processing facility lease and their election to exercise their option to purchase
the building. On January 31, 2002 UPS purchased the building for $127.9 million, equivalent to the settlement value, and also purchased the land on which the building is located for $13.6 million, resulting in a total pre-tax gain on sale of $47.1
million. Total rent from the facility lease was $4.6 million for the three months ended September 30, 2001. Total rent from the facility lease was $3.6 million and $13.9 million for the nine months ended September 30, 2002 and 2001,
respectively.

6.      DEBT REPURCHASE

In 1989 a subsidiary of OPCC acquired five 757 aircraft and a
data processing facility. The acquisition of the aircraft and the facility were financed by two series of privately placed, fixed rate, non-callable bonds issued by OPL Funding Corp. (OPL Funding), incorporated in Delaware as a single
purpose subsidiary of Overseas Capital Co. One series (Series A Bonds), in the principal amount of $171.6 million, is due in 2012; the other (Series B Bonds), in the principal amount of $73.4 million, is due in 2019. Overseas
Partners Credit, Inc. (Overseas Credit), a single purpose subsidiary of OPL incorporated in the Cayman Islands, guaranteed the principal of these bonds and pledged zero-coupon treasury notes as security for the guarantee. Such securities
were classified as held-to-maturity, consistent with our stated intent and ability and also the non-callable status of the bond obligations.

The aircraft were sold in July 1998 and the data processing facility
was sold in January 2002. OPL Funding invested $186.6 million of the proceeds from the sale of the aircraft into United States zero-coupon treasury notes and corporate bonds as substitute collateral for the interest obligations associated with the
Series A Bonds. Following the sale of the data processing facility, OPL Funding invested $84.2 million of the proceeds from the sale into United States zero-coupon treasury notes as substitute collateral for the interest obligations associated with
the Series B Bonds. These investments were sufficient to defease all remaining interest payments due on the bonds and were also classified as held-to-maturity, consistent with our stated intent and ability and also the non-callable status of the
bond obligations.

Following our February 2002 decision to put our operations into runoff we have sought to accelerate the settlement of reinsurance and real estate liabilities. During June 2002 we approached and
obtained the consent of all the bondholders to amend the Trust Indenture to permit the repurchase and cancellation of the Series A Bonds and Series B Bonds. The terms of the repurchase and cancellation required the Company to pay an amount
equivalent to the fair value of the collateral securities (relating to both principal and interest) to the bondholders. On June 27, 2002 OPL Funding completed the repurchase and cancellation of $111.6 million of the Series A Bonds and $58.4 million
of the Series B Bonds for a total premium of $78.0 million recorded in interest expense. The corresponding sale of the collateral securities with an amortized cost of $211.5 million resulted in an offsetting $34.8 million gain on sale.

There remains $60 million of Series A Bonds and $15 million of Series B Bonds outstanding, all held by one bondholder, an insurance company unrelated to OPL. Following these actions, we reclassified the remaining collateral
securities relating to these outstanding bonds from the held-to-maturity category to the available-for-sale category. As at September 30, 2002 these bonds had an amortized cost of $92.9 million and a fair value of $117.9 million. An amount
corresponding to the unrealized gains of $25.0 million is recorded in Accounts Payable and Other Liabilities to reflect the bondholders interest in the underlying collateral securities.



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTSSEPTEMBER 30,
2002(Unaudited)

7.      STATUTORY FINANCIAL INFORMATION

OPLs
ability to repurchase shares, pay dividends, or make other distributions to shareowners is subject to certain regulatory restrictions including the following:

| | 1. |  | In Bermuda, the Bermuda Insurance Act of 1978, amendments thereto and related Regulations (the Act) requires OPL and its Bermuda based reinsurance subsidiaries to each maintain a minimum solvency margin
determined as the greater of 15% of accrued losses and loss expenses, (net of reinsurance recoverables), or a given fraction of net premiums written. OPL, Overseas Partners Re Ltd. (OPRe) and Overseas Partners Assurance Ltd. (OPAL) were all in
compliance with these requirements for the nine months ended September 30, 2002 and 2001.                                                                                                                                                                                                                                                                                                                                                                                          
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    | 
| | 2. |  | The Act also requires OPL and its Bermuda based reinsurance subsidiaries to each maintain a minimum liquidity ratio whereby the value of their relevant assets, (mainly cash, investments, receivables and other liquid
assets), are not less than 75% of the amount of their relevant liabilities, (mainly accrued losses and loss expenses, unearned premiums, reinsurance balances payable and other accounts payable). Investments in and advances to subsidiaries are not
included in the definition of relevant assets for purposes of this test. OPRe and OPAL met these requirements for the periods ended September 30, 2002 and 2001. OPL did not meet the minimum liquidity ratio requirement at December 31, 2001 as
significantly all of its assets were invested in subsidiaries. In February 2002 OPL received a distribution of cash from OPCC and has subsequently been in compliance with the minimum liquidity ratio requirement.
| |    | 
| | 3. |  | Dividend payments by OPLs United States based reinsurance subsidiary OPUS Re are limited by statutory regulations. The dividend restrictions are generally based on net investment income, statutory net income and on
certain levels of policyholders surplus as determined under statutory accounting practices. The maximum amount of dividends out of unassigned surplus that may be paid by the Company without prior approval of the Delaware Insurance Commissioner
is limited to the greater of (i) 10% of the Companys surplus as regards policyholders as shown in the preceding years annual statement or (ii) net income, excluding realized capital gains, as shown in the preceding years annual
statement.                                                                                                                                                                                                                      
| |    | 
| | 4. |  | OPUS Re is also subject to certain Risk-Based Capital (RBC) requirements as specified by the National Association of Insurance Commissioners. Under those requirements, the amount of capital and surplus
maintained by an insurance company is to be determined based on the various risk factors related to it. At September 30, 2002 and December 31, 2001, OPUS Re met the RBC requirements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | 
| | 5. |  | As a holding company, substantially all of OPLs assets relate to its investments in subsidiaries. As such, OPLs ability to make future distributions, including share repurchases, is dependent upon it receiving
distributions from its subsidiaries. The Act prohibits OPL, OPRe and OPAL from distributing more than 15% of the prior years statutory capital unless specific approval is obtained from the Bermuda Monetary Authority. In addition to the
requirements of the Act the Bermuda Monetary Authority has requested that all distributions from OPAL, OPRe and OPL be pre-approved by themselves. In addition to the regulatory restrictions, each subsidiary needs to consider, inter alia, the
potential for future adverse development in the settlement of reinsurance liabilities and the contingencies described in notes 4 and 8 prior to making such distributions.                                                       



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESCONDENSED NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTSSEPTEMBER 30,
2002(Unaudited)

8.      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 Racketeer Influenced and Corrupt Organizations (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. The parties to the Tax Court action
filed Supplemental Briefs on remand on March 18, 2002. OPL is not a party to the Tax Court action.

The Company filed or joined in motions to dismiss all of the consolidated 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. In orders dated July 30, 2002, the Court granted in part and denied in part the motions to
dismiss. Pursuant to the Courts orders, the claims remaining against the Company are RICO, antitrust, and common law interference with contract claims. On November 8, 2002, the parties presented to the Court a stipulation and proposed order
certifying a nationwide class with respect to certain of the claims brought by the plaintiffs, including the RICO and interference with contract claims against the Company. The Court indicated that it would sign the stipulation and proposed order.
The stipulation does not certify the antitrust claims brought against the Company. The Company believes that it has meritorious defenses to all claims asserted against it and intends to defend them vigorously. There can be no assurance, however,
that an adverse determination of the lawsuits would not have a material effect on the Company.



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OVERSEAS PARTNERS LTD. AND SUBSIDIARIESItem 2. MANAGEMENTS DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION
AND RESULTS OF OPERATIONS(Transacted in U.S. Dollars)

The following is a discussion and analysis of our results of operations, financial condition, liquidity and capital
resources as of and for the three and nine-months ended September 30, 2002 and 2001. Our results of operations and cash flows for any interim period are not necessarily indicative of our results for the full year. This discussion and analysis should
be read in conjunction with the accompanying unaudited condensed consolidated financial statements and notes thereto and the Managements Discussion and Analysis of Results of Operations and Financial Condition and the audited
consolidated financial statements of the Company at and for the year ended December 31, 2001 and notes thereto included in the Companys 2001 Annual Report to Shareholders.

RESULTS OF
OPERATIONS

Three Months Ended September 30, 2002 and 2001

Reinsurance:

|(In thousands)                               |  | 2002 |          | 2001 |  
|-------------------------------------------- |  | ---- | -------- | ---- | -
|                                             |  |      |          |      |  
|Gross premiums written                       |  | $    | (175,304 | )    | $
|Premiums ceded                               |  |      | 476      |      |  
|                                             |  |      |          |      |  
|Net premiums written                         |  |      | (174,828 | )    |  
|Change in unearned premiums                  |  |      | 242,508  |      |  
|                                             |  |      |          |      |  
|Premiums earned                              |  |      | 67,680   |      |  
|Commission and fee income                    |  |      | 2,685    |      |  
|                                             |  |      |          |      |  
|                                             |  |      | 70,365   |      |  
|                                             |  |      |          |      |  
|Losses and loss expenses                     |  |      | (110,303 | )    |  
|Commissions, taxes and underwriting expenses |  |      | (15,358  | )    |  
|                                             |  |      |          |      |  
|                                             |  |      | (125,661 | )    |  
|                                             |  |      |          |      |  
|Underwriting loss                            |  |      | (55,296  | )    |  
|                                             |  |      |          |      |  
|                                             |  |      |          |      |  
|Investment loss                              |  |      | (171,603 | )    |  
|                                             |  |      |          |      |  
|                                             |  |      |          |      |  
|Reinsurance loss                             |  | $    | (226,899 | )    | $
|                                             |  |      |          |      |  

Underwriting

On February 13, 2002 the Board of Directors of OPL announced its decision to restructure OPL and cause its Bermuda based
reinsurance operations to begin an orderly runoff. During the second quarter of 2002 we made the decision to place our United States subsidiary, OPUS Re, into runoff and to cease writing any further reinsurance business in that subsidiary. These
decisions mean that OPL will not write any new reinsurance business. Premiums will continue to be earned on business written prior to the runoff decisions.

Prior to the runoff decision the Company focused on a
small number of specialized products including finite risk, accident & health and property catastrophe in Bermuda and working layer casualty in the United States through OPUS Re.

Following the decision to
place the Company into runoff, we have completed the early commutation (i.e. negotiated settlement and cancellation) and novation (i.e. transfer of our rights and obligations to another reinsurer) of several multi-year reinsurance programs,
particularly in our finite risk division, which had significant exposure to future loss and / or cash flow needs. Loss reserve settlements that are structured as commutations are recorded as an increase or decrease in incurred claims whereas the
commutation of unexpired risks and novations are recorded as a return of the original premium income and attendant claims and expenses. During the three months ended September 30, 2002, the Company was able to novate two finite risk contracts that
had original gross written premium estimates of $144.3 million to other reinsurers. These contracts had been written between January 1, 2002 and February 13, 2002. In addition OPUS Re commuted several contracts during the three months ended
September 30, 2002 such that original gross written premium estimates were reduced by $26.1 million. Gross premiums written for the three months ended September 30, 2002 of negative $175.3 million reflect the effect of these commutations and
novations.

Premiums ceded for the three months ended September 30, 2002 decreased to negative $0.5 million compared to $54.9 million for the three months ended September 30, 2001. Premiums ceded for the three
months ended September 30, 2001 were primarily comprised of $43.4 million for the cost of reinstatement premiums in respect of the utilization of our per occurrence aviation excess of loss covers following the terrorist attacks of September 11, 2001
and $8.6 million related to the reinsurance of our property catastrophe business that was sold to Renaissance Re Holdings Ltd. in May 2002.



---

Reinsurance:(continued)

Premiums earned for the three months ended September 30, 2002
decreased to $67.7 million compared to $140.1 million for the three months ended September 30, 2001. This decrease was due to significant reductions in premiums earned by our finite risk division following the commutations and novations discussed
above and a reduction in premiums earned in our property and workers compensation lines of business as no new business was being written following the decision to put our reinsurance operations into runoff. These reductions were partially
offset by an increase in premiums earned by OPUS Re as a result of continued growth in premiums written from the commencement of operations in the first quarter of 2001 until its runoff announcement in the second quarter of 2002.

Commission and fee income increased to $2.7 million for the three months ended September 30, 2002 compared with $0.4 million for the corresponding period in 2001. This increase is due to an increase 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.

Commissions, taxes and underwriting
expenses for the three months ended September 30, 2002 decreased by $51.1 million to $15.4 million from $66.5 million for the three months ended September 30, 2001. This decrease was due to the reduction in premiums earned in the three months ended
September 30, 2002 and changes in the mix of business.

Our combined ratio, which is the ratio of the sum of losses, loss expenses, commissions, taxes and other underwriting expenses to earned premiums was 185.7%
for the three months ended September 30, 2002 and we experienced a net underwriting loss of $55.3 million. The underwriting loss is primarily due to:

| |  |  | Incurred losses of $29.9 million as a result of credit default events on a multi-year financial lines program.
| | - |  | --------------------------------------------------------------------------------------------------------------

| |  |  | Incurred losses of $10.8 million reflecting the cost of commutations of three of our satellite programs.
| | - |  | --------------------------------------------------------------------------------------------------------

| |  |  | Internal runoff costs of $5.5 million.
| | - |  | --------------------------------------

| |  |  | OPUS Re casualty business, and other long tail programs, where we expect to generate profits through future investment income.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------

The
combined ratio for the three months ended September 30, 2001 was 208.9% and we experienced a net underwriting loss of $152.3 million. The combined ratio for the three months ended September 30, 2001 was affected by the following factors:

| |  |  | The impact of the terrorist attacks of September 11, 2001 on several lines of our business, resulting in estimated losses of $130.0 million.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------

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

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.

The Company is involved in a complex reinsurance program that covers
the worldwide property risks of a large oil company. As part of the program, a portion of the Companys risks have been retroceded to a reinsurer (our reinsurer), which in turn ceded all of its risk to a retrocessionaire. This
retrocessionaire has commenced litigation against our reinsurer alleging fraud and misrepresentation on the part of one or more of the other program participants. In the event that the retrocessionaire is successful in the litigation it may be
relieved of any obligation to pay losses under its reinsurance contract to our reinsurer. Such an outcome would likely cause our reinsurer to seek similar legal redress against us which, if successful, could (a) require us to return loss payments
already received of approximately $17 million; and (b) result in the cancellation of our reinsurance protection for future claims, the impact which cannot be determined at this time. However, in such circumstances, management believes that the
Company would be able to pursue legal remedies of its own. The litigation and related disputes are at an early stage and will likely take many months to resolve. As such, it is too early to determine the outcome of the dispute nor the ultimate
impact on the Companys financial condition.

The Company is engaged in several other ongoing disputes, including arbitration and litigation that have arisen in the ordinary course of business. The Company
continues to reserve for losses and loss expenses based on the terms of contractual arrangements currently in force.



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|(In thousands)           |  | (Loss)Income2002 |          | OtherComprehensiveIncome2002 |   | TotalReturn2002 |  | Income(Loss)2001 |         | OtherComprehensive(Loss) Income2001 |   | TotalReturn2001 |  
|------------------------ |  | ---------------- | -------- | ---------------------------- | - | --------------- |  | ---------------- | ------- | ----------------------------------- | - | --------------- | -
|                         |  |                  |          |                              |   |                 |  |                  |         |                                     |   |                 |  
|Equities                 |  | $                | (185,220 | )                            | $ | 105,291         |  | $                | (79,929 | )                                   | $ | 173             |  
|Fixed income             |  |                  | 11,736   |                              |   | 9,712           |  |                  | 21,448  |                                     |   | 12,087          |  
|Emerging market equities |  |                  | 53       |                              |   |                |  |                  | 53      |                                     |   | (38,679         | )
|Multi-manager funds      |  |                  | (916     | )                            |   |                |  |                  | (916    | )                                   |   | (5,717          | )
|Other                    |  |                  | 3,424    |                              |   | 172             |  |                  | 3,596   |                                     |   | 1,595           |  
|Expenses                 |  |                  | (680     | )                            |   |                |  |                  | (680    | )                                   |   | (1,446          | )
|                         |  |                  |          |                              |   |                 |  |                  |         |                                     |   |                 |  
|                         |  | $                | (171,603 | )                            | $ | 115,175         |  | $                | (56,428 | )                                   | $ | (31,987         | )
|                         |  |                  |          |                              |   |                 |  |                  |         |                                     |   |                 |  

As discussed below in the Liquidity and Capital Resources section, the asset allocation of our reinsurance investment portfolio changed significantly between September 30, 2001 and
September 30, 2002, as a result of the change in the Companys business and the decision to put the reinsurance operations into runoff. The revised asset allocation reflects our lower risk tolerance and provides more short-term liquidity.
However, there may still be periods in which the Company records an investment loss as a result of the continued volatility in worldwide equity and bond markets.

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 members equity as other comprehensive income. The Company periodically reviews the available-for-sale portfolio for any impairment in value that is considered to be other-than-temporary. Any such impairments are recorded as a write
down in the cost basis with a corresponding realized loss recorded in income.

Our reinsurance portfolio generated a loss of $56.4 million for the three months ended September 30, 2002. This consisted of a net
loss of $171.6 million recorded in income and a change in net unrealized gains of $115.2 million that was recorded in other comprehensive income compared to a total negative return of $92.7 million consisting of a net loss of $32.0 million recorded
in income and net unrealized losses of $60.8 million for the three months ended September 30, 2001.

For the three months ended September 30, 2002 our equity portfolio has generated a loss of 23.9%, or $79.9
million, consisting of a loss of $185.2 million that was recorded in income and a change in net unrealized gains of $105.3 million that was recorded in other comprehensive income. These results included the effects of the write-down in the cost
basis of equity investments in certain stocks in our S&P 500 portfolio and our investment in a Bermuda based life reinsurer, where the decline in value was considered other than temporary. In accordance with SFAS 115, such a write-down is
recognized as a realized loss in the income statement, even though there were no sales of the securities. For the three months ended September 30, 2002 the amount of the write-down was $177.5 million. Our investment in the Bermuda based life
reinsurer has generated a total negative return of $25.0 million for the three months ended September 30, 2002 compared to a total negative return of $3.4 million for the same period in 2001. The rest of our equity portfolio closely tracks the
S&P 500 index, which fell from 990 at June 30, 2002 to 815 at September 30, 2002. During the three months ended September 30, 2001, our equity portfolio generated a loss of 13.4% or $101.8 million, consisting of income of $0.2 million and net
unrealized losses of $102.0 million that were recorded in other comprehensive income.

For the three months ended September 30, 2002 our fixed income portfolios generated a gain of 2.6%, or $21.4 million,
consisting of $11.7 million that was recorded in income and net unrealized losses of $9.7 million recorded in other comprehensive income. For the three months ended September 30, 2001 our fixed income portfolios generated a return of 5.8%, or $53.2
million, consisting of $12.1 million that was recorded in income and net unrealized gains of $41.1 million recorded in other comprehensive income.

Our multi-manager funds, which are primarily a combination of
fixed income strategies, lost $0.9 million for the three months ended September 30, 2002 compared to a loss of $5.7 million for the three months ended September 30, 2001. For both our emerging markets equity portfolio and multi-manager funds we
record unrealized gains and losses in income. Cash and cash equivalents earn short-term money market rates which equated to an annualized return of 1.84% for the three months ended September 30, 2002 compared to 5.2% for the same period in 2001.



---

Real Estate and Leasing:

|(In thousands)                            |  | 2002 |        | 2001 |  
|----------------------------------------- |  | ---- | ------ | ---- | -
|                                          |  |      |        |      |  
|REVENUE:                                  |  |      |        |      |  
|Office building                           |  | $    | 3,751  |      | $
|Hotel                                     |  |      |       |      |  
|Leasing                                   |  |      | 839    |      |  
|Gain on sale of assets                    |  |      | 34,211 |      |  
|                                          |  |      |        |      |  
|                                          |  |      | 38,801 |      |  
|                                          |  |      |        |      |  
|EXPENSES:                                 |  |      |        |      |  
|Operating expenses                        |  |      | (2,558 | )    |  
|Interest expense                          |  |      | (3,029 | )    |  
|Depreciation                              |  |      | (514   | )    |  
|Minority interest in earnings             |  |      | (205   | )    |  
|                                          |  |      |        |      |  
|                                          |  |      | (6,306 | )    |  
|                                          |  |      |        |      |  
|                                          |  |      |        |      |  
|                                          |  |      |        |      |  
|Operating income                          |  |      | 32,495 |      |  
|                                          |  |      |        |      |  
|                                          |  |      |        |      |  
|Investment income:                        |  |      |        |      |  
|Real estate investment trust certificates |  |      |       |      |  
|Amortization of zero-coupon notes         |  |      | 1,447  |      |  
|Other                                     |  |      | 467    |      |  
|                                          |  |      |        |      |  
|Investment income                         |  |      | 1,914  |      |  
|                                          |  |      |        |      |  
|                                          |  |      |        |      |  
|                                          |  |      |        |      |  
|Real estate and leasing income            |  | $    | 34,409 |      | $
|                                          |  |      |        |      |  

Office building revenue decreased by $15.3 million to $3.7 million for the three months ended September 30, 2002 from $19.1 million for the three months ended September 30, 2001. The
reduction in revenue is due to the sale of our two-thirds partnership interest in the Copley Place retail center and office complex, located in Boston. Copley Place was sold on July 19, 2002 for net cash proceeds of $119.6 million resulting in a
pre-tax gain on sale of $34.3 million. The purchaser of the property assumed the associated existing debt of $184.6 million.

Hotel revenue for the three months ended September 30, 2002 was $nil due to the sale
of the Marriott Copley Hotel on June 13, 2002.

Leasing revenue of $0.8 million for the three months ended September 30, 2002 related to a finance lease with the Kmart Corporation. The reduction in leasing
revenue from $5.5 million for the three months ended September 30, 2001 was due to the sale to UPS of the data processing facility leased to UPS and the termination of the lease on January 31, 2002.

On January
22, 2002 the Kmart Corporation and 37 of its United States subsidiaries filed voluntary petitions for reorganization under chapter 11 of the United States Bankruptcy Code. Kmart Corporation has not to date filed a request to reject our unexpired
lease. However, there can be no assurance that it will not file this request or default on its future payments. To date the Kmart Corporation has not defaulted on any of its lease payments. We believe that any rejection of the unexpired lease by
Kmart would not have a material effect on the consolidated financial position or future results of operations of OPL as we believe that the facility would be available for other uses.

For the three months ended
September 30, 2002 operating expenses, interest expense and depreciation decreased to $2.6 million, $3.0 million and $0.5 million, respectively, compared to $25.4 million, $12.0 million and $4.9 million, respectively, for the three months ended
September 30, 2001. These decreases were primarily due to the sales of the data processing facility in January 2002, the Marriott Copley Hotel in June 2002 and Copley Place in July 2002 and the debt repurchase in June 2002.



---

Net Loss:

|(In thousands)                     |  | 2002 |          | 2001 |  
|---------------------------------- |  | ---- | -------- | ---- | -
|                                   |  |      |          |      |  
|NET LOSS BEFORE TAXES              |  |      |          |      |  
|Reinsurance                        |  | $    | (226,899 | )    | $
|Real estate and leasing            |  |      | 34,409   |      |  
|Other operating expenses           |  |      | (4,052   | )    |  
|                                   |  |      |          |      |  
|Consolidated net loss before taxes |  |      | (196,542 | )    |  
|Income taxes                       |  |      | (14,310  | )    |  
|                                   |  |      |          |      |  
|Net loss                           |  | $    | (210,852 | )    | $
|                                   |  |      |          |      |  

The net loss for the three months ended September 30, 2002 was $210.9 million compared to $183.6 million for the same period in 2001, an increase of $27.2 million. This increase was
primarily due to the other-than-temporary impairment charge of $177.5 million recorded in our equity portfolio, offset by a reduction in underwriting losses and the gain on sale of Copley Place. For the three months ended September 30, 2002 there
was a tax charge of $14.3 million compared to a charge $0.6 million for the same period in 2001. The increase was primarily due to the tax due on the gain on sale of Copley Place. Basic and diluted net loss per share was $1.77 for the three months
ended September 30, 2002 compared to a net loss per share of $1.54 for the same period in 2001.

Nine Months Ended September 30, 2002 and 2001

Reinsurance:

|(In thousands)                               |  | 2002 |          | 2001 |  
|-------------------------------------------- |  | ---- | -------- | ---- | -
|                                             |  |      |          |      |  
|Gross premiums written                       |  | $    | 509,279  |      | $
|Premiums ceded                               |  |      | (83,943  | )    |  
|                                             |  |      |          |      |  
|Net premiums written                         |  |      | 425,336  |      |  
|Change in unearned premiums                  |  |      | (31,597  | )    |  
|                                             |  |      |          |      |  
|Premiums earned                              |  |      | 393,739  |      |  
|Commission and fee income                    |  |      | 6,245    |      |  
|                                             |  |      |          |      |  
|                                             |  |      | 399,984  |      |  
|                                             |  |      |          |      |  
|Losses and loss expenses                     |  |      | (359,082 | )    |  
|Commissions, taxes and underwriting expenses |  |      | (124,097 | )    |  
|                                             |  |      |          |      |  
|                                             |  |      | (483,179 | )    |  
|                                             |  |      |          |      |  
|Underwriting loss                            |  |      | (83,195  | )    |  
|                                             |  |      |          |      |  
|                                             |  |      |          |      |  
|Investment loss                              |  |      | (175,452 | )    |  
|                                             |  |      |          |      |  
|Gain on sale of PIP                          |  |      |         |      |  
|                                             |  |      |          |      |  
|                                             |  |      |          |      |  
|Reinsurance loss                             |  | $    | (258,647 | )    | $
|                                             |  |      |          |      |  

Underwriting

Gross premiums written for the nine months ended September 30, 2002 reflect $0.8 million of new business written in Bermuda
(net of the effect of subsequent novations) and $221.8 million of renewals compared with $121.9 million and $402.1 million, respectively, for the same period in the prior year. In addition, OPUS Re wrote $263.6 million of gross premiums in the nine
months ended September 30, 2002 compared to $152.3 million for the same period in the prior year. Gross premiums written for the nine months ended September 30, 2002 also reflect an increase in premium estimates of approximately $23.0 million
compared with a decrease of $40.8 million for the nine months ended September 30, 2001.



---

Reinsurance:(continued)

The following table provides an analysis of gross premiums written by line of
business, both in the aggregate and as a percentage of total premiums, for each of the nine-month periods ended September 30, 2002 and 2001:

|(in thousands except for percentages)  |  | 2002 |         | 2001 | 
|-------------------------------------- |  | ---- | ------- | ---- | 
|                                       |  |      |         |      | 
|Gross reinsurance premiums written:    |  |      |         |      | 
|Automobile liability & physical damage |  | $    | 106,984 |      | 
|Finite risk                            |  |      | 89,203  |      | 
|Property catastrophe                   |  |      | 79,275  |      | 
|Accident & health                      |  |      | 74,975  |      | 
|Agriculture                            |  |      | 55,618  |      | 
|General & professional liability       |  |      | 44,252  |      | 
|Workers compensation                  |  |      | 35,843  |      | 
|Multi-line                             |  |      | 16,455  |      | 
|Aviation                               |  |      | (3,223  | )    | 
|Other                                  |  |      | 9,897   |      | 
|                                       |  |      |         |      | 
|                                       |  | $    | 509,279 |      | 
|                                       |  |      |         |      | 

Premiums earned for the nine months ended September 30, 2002 decreased to $393.8 million compared to $445.7 million for the nine months ended September 30, 2001. This decrease was
primarily due to decreases in premiums earned on our workers compensation, property catastrophe and finite risk lines of business following the runoff decision. This was partially offset by an increase in premiums earned by OPUS Re reflecting
the fact that OPUS Re only commenced writing business in the first quarter of 2001.

Commission and fee income increased to $6.2 million for the nine months ended September 30, 2002 compared with $3.7 million for
the corresponding period in 2001. This increase is due to an increase in the 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.

For the nine months ended September 30, 2002 premiums ceded increased to $83.9 million compared to $81.9 million for the nine months ended September 30, 2001. Premium ceded for the nine months
ended September 30, 2002 primarily related to:

| |  |  | $77.4 million of property catastrophe premiums ceded to Renaissance Reinsurance Ltd. including $50.9 million as a result of a 100% quota share of the in-force property catastrophe business
that became effective on February 15, 2002.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | $3.4 million of premiums ceded relating to our purchase of several layers of excess of loss protection for our aviation book of business. The reinsurance protection provides coverage of $12.0
million in excess of $3.0 million for a single loss event for losses occurring up until August 2003. Each layer of this excess of loss protection can be reinstated a maximum of either one or two times.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Commissions, taxes and underwriting expenses for the nine months ended September 30, 2002 decreased by $36.4 million from $160.5 million for the nine months ended September 30, 2001. This decrease was related to the decrease
in premiums earned and also the change in the mix of business.

Our combined ratio, which is the ratio of the sum of losses, loss expenses, commissions, taxes and other underwriting expenses to earned premiums
was 122.7% for the nine months ended September 30, 2002 and we experienced a net underwriting loss of $83.2 million. The underwriting loss is primarily due to:

| |  |  | Incurred losses of $29.9 million as a result of credit default events on a multi-year financial lines program.
| | - |  | --------------------------------------------------------------------------------------------------------------

| |  |  | Incurred losses of $10.8 million reflecting the cost of commutations of three of our satellite programs.
| | - |  | --------------------------------------------------------------------------------------------------------

| |  |  | Internal underwriting expenses and runoff costs of $22.5 million.
| | - |  | -----------------------------------------------------------------

| |  |  | OPUS Re casualty business, and other long tail programs, where we expect to generate profits through future investment income.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------

The
combined ratio for the nine months ended September 30, 2001 was 143.2% and we experienced a net underwriting loss of $189.0 million. The combined ratio for the nine months ended September 30, 2001 was affected by the following factors:

| |  |  | The impact of the terrorist attacks of September 11, 2001 on several lines of our business, resulting in estimated losses of $130.0 million.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------

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



---

Reinsurance Investment Loss

|(In thousands)           |  | (Loss)Income2002 |          | OtherComprehensiveIncome2002 |   | TotalReturn2002 |   | (Loss)Income2001 |          | OtherComprehensive(Loss) Income2001 |   | TotalReturn2001 |  
|------------------------ |  | ---------------- | -------- | ---------------------------- | - | --------------- | - | ---------------- | -------- | ----------------------------------- | - | --------------- | -
|                         |  |                  |          |                              |   |                 |   |                  |          |                                     |   |                 |  
|Equities                 |  | $                | (204,761 | )                            | $ | 67,684          |   | $                | (137,077 | )                                   | $ | (27,880         | )
|Fixed income             |  |                  | 23,712   |                              |   | 21,597          |   |                  | 45,309   |                                     |   | 26,558          |  
|Emerging market equities |  |                  | (512     | )                            |   |                |   |                  | (512     | )                                   |   | (35,549         | )
|Multi-manager funds      |  |                  | 1,103    |                              |   |                |   |                  | 1,103    |                                     |   | (817            | )
|Other                    |  |                  | 8,592    |                              |   | (12             | ) |                  | 8,580    |                                     |   | 6,288           |  
|Expenses                 |  |                  | (3,586   | )                            |   |                |   |                  | (3,586   | )                                   |   | (4,542          | )
|                         |  |                  |          |                              |   |                 |   |                  |          |                                     |   |                 |  
|                         |  | $                | (175,452 | )                            | $ | 89,269          |   | $                | (86,183  | )                                   | $ | (35,942         | )
|                         |  |                  |          |                              |   |                 |   |                  |          |                                     |   |                 |  

Our reinsurance portfolio generated a loss of $86.2 million for the nine months ended September 30, 2002. This consisted of a net loss of $175.5 million recorded in income and a change
in net unrealized gains of $89.3 million that was recorded in other comprehensive income compared to a loss of $150.6 million consisting of a net loss of $35.9 million that was recorded in income and net unrealized losses of $114.7 million for the
nine months ended September 30, 2001.

For the nine months ended September 30, 2002 our equity portfolio has generated a loss of 34.6%, or $137.1 million, consisting of a loss of $204.8 million that was recorded
in income and a change in net unrealized gains of $67.7 million that was recorded in other comprehensive income. These results included the effects of the write-down in the cost basis of equity investments in certain stocks in our S&P 500
portfolio and our investment in a Bermuda based life reinsurer, where the decline in value was considered other than temporary. In accordance with SFAS 115, such a write-down is recognized as a realized loss in the income statement, even though
there were no sales of the securities. For the nine months ended September 20, 2002 the amount of the write-down was $177.5 million. Our investment in the Bermuda based life reinsurer has generated a total negative return of $38.3 million for the
nine months ended September 30, 2002 compared to a positive total return of $3.8 million for the same period in 2001. The rest of our equity portfolio closely tracks the S&P 500 index. On January 1, 2002 the S&P 500 index was 1,148 and fell
to 815 by September 30, 2002. During the nine months ended September 30, 2001, our equity portfolio generated a negative return of 18.5% or $149.3 million, consisting of a loss of $27.9 million that was recorded in income and net unrealized losses
of $121.4 million that were recorded in other comprehensive income.

For the nine months ended September 30, 2002 our fixed income portfolios generated a gain of 5.4%, or $45.3 million, consisting of $23.7
million that was recorded in income and net unrealized gains of $21.6 million recorded in other comprehensive income. For the nine months ended September 30, 2001 our fixed income portfolios generated a gain of 3.9%, or $33.4 million, consisting of
$26.6 million that was recorded in income and net unrealized gains of $6.8 million recorded in other comprehensive income.

As a result of our change in asset allocation our emerging markets equity portfolio was
less than $3 million at December 31, 2001 and has been further reduced during the nine months ended September 30, 2002. Our multi-manager funds, which are primarily a combination of fixed income strategies, gained $1.1 million for the nine months
ended September 30, 2002 compared to a loss of $0.8 million for the nine months ended September 30, 2001. For both our emerging markets equity portfolio and multi-manager funds we record unrealized gains and losses in income. Cash and cash
equivalents earn short-term money market rates which equated to an annualized return of 1.88% for the nine months ended September 30, 2002 compared to 5.2% for the same period in 2001.



---

Real Estate and Leasing:

|(In thousands)                            |  | 2002 |          | 2001 |  
|----------------------------------------- |  | ---- | -------- | ---- | -
|                                          |  |      |          |      |  
|REVENUE:                                  |  |      |          |      |  
|Office buildings                          |  | $    | 39,605   |      | $
|Hotel                                     |  |      | 37,222   |      |  
|Leasing                                   |  |      | 6,176    |      |  
|Gain on sale of assets                    |  |      | 140,203  |      |  
|                                          |  |      |          |      |  
|                                          |  |      | 223,206  |      |  
|                                          |  |      |          |      |  
|EXPENSES:                                 |  |      |          |      |  
|Operating expenses                        |  |      | (51,871  | )    |  
|Interest expense                          |  |      | (26,262  | )    |  
|Premium on debt repurchase                |  |      | (78,001  | )    |  
|Depreciation                              |  |      | (9,037   | )    |  
|Minority interest in earnings             |  |      | (2,025   | )    |  
|                                          |  |      |          |      |  
|                                          |  |      | (167,196 | )    |  
|                                          |  |      |          |      |  
|                                          |  |      |          |      |  
|Operating income                          |  |      | 56,010   |      |  
|                                          |  |      |          |      |  
|                                          |  |      |          |      |  
|Investment income:                        |  |      |          |      |  
|Real estate investment trust certificates |  |      |         |      |  
|Amortization of zero-coupon notes         |  |      | 10,371   |      |  
|Gain on sale of zero-coupon notes         |  |      | 34,803   |      |  
|Other                                     |  |      | 1,498    |      |  
|                                          |  |      |          |      |  
|Investment income                         |  |      | 46,672   |      |  
|                                          |  |      |          |      |  
|                                          |  |      |          |      |  
|Real estate and leasing income            |  | $    | 102,682  |      | $
|                                          |  |      |          |      |  

For the nine months ended September 30, 2002 office building revenue decreased by $25.8 million to $39.6 million from $65.4 million for the nine months ended September 30, 2001. This
decrease was mainly attributable to the timing of property sales. Following the sales of Madison Plaza in February 2001 and the Atlanta Financial Center in April 2001 we had only one remaining office building, a two-thirds partnership interest in
the Copley Place retail center and office complex. Copley Place was sold on July 19, 2002 for net cash proceeds of $119.6 million resulting in a pre-tax gain on sale of $34.3 million. The purchaser of the property assumed the associated existing
debt of $184.6 million.

For the nine months ended September 30, 2002 hotel revenue, which relates to the Marriott Copley Hotel located in Boston, decreased by $34.6 million to $37.2 million from $71.8 million
for the nine months ended September 30, 2001. The decrease was primarily due to the sale of the property on June 13, 2002, although revenue was also adversely affected by a rooms renovation which resulted in fewer rooms being available from April
2002. The hotel was sold for net cash proceeds of $111.6 million resulting in a pre-tax gain on sale of $58.8 million. The purchaser of the property assumed the associated existing debt of $96.9 million.

Leasing
revenue for the nine months ended September 30, 2002 decreased by $10.4 million to $6.2 million when compared to the nine months ended September 30, 2001. The decrease was mainly attributable to the sale of the data processing facility to UPS and
the termination of the lease by UPS in January 2002. UPS had an option to purchase the building in which the data processing facility is located at the higher of fair market value or a settlement value, as defined in the lease agreement, prevailing
at that time. On September 21, 2001 UPS notified the Company of their election to terminate the data processing facility lease and their election to exercise their option to purchase the building. On January 31, 2002 UPS purchased the building for
$127.9 million, equivalent to the settlement value, and also purchased the land on which the building is located for $13.6 million, resulting in a total pre-tax gain on sale of $47.1 million.

Of the $6.2 million
leasing revenue for the nine months ended September 30, 2002, $2.5 million relates to a finance lease with the Kmart Corporation. On January 22, 2002 the Kmart Corporation and 37 of its United States subsidiaries filed voluntary petitions for
reorganization under chapter 11 of the United States Bankruptcy Code. Kmart Corporation has not to date filed a request to reject our unexpired lease. However, there can be no assurance that it will not file this request or default on its future
payments. We believe that any rejection of the unexpired lease by Kmart would not have a material effect on the consolidated financial position or future results of operations of OPL as we believe that the facility would be available for other uses.
To date the Kmart Corporation has not defaulted on any of its lease payments.



---

Real Estate and Leasing:(continued)

The gain on sale of assets for the nine
months ended September 30, 2001 related 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. 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.

For the nine months ended September 30, 2002 operating expenses, interest expense and depreciation decreased to $51.9 million, $26.3 million and $9.0
million, respectively, compared to $88.0 million, $41.2 million and $14.7 million, respectively, for the nine months ended September 30, 2001. These decreases were primarily due to the timing of our property sales. The minority interest in earnings
relates to the one-third partnership in Copley Place.

In 1989 a subsidiary of OPCC acquired five 757 aircraft and a data processing facility. The acquisition of the aircraft and the facility were financed by two
series of privately placed, fixed rate, non-callable bonds issued by OPL Funding Corp. (OPL Funding), incorporated in Delaware as a special purpose subsidiary of Overseas Capital Co. One series (Series A Bonds), in the
principal amount of $171.6 million, is due in 2012; the other (Series B Bonds), in the principal amount of $73.4 million, is due in 2019. Overseas Partners Credit, Inc. (Overseas Credit), a special purpose subsidiary of OPL
incorporated in the Cayman Islands, guaranteed the principal of these bonds and pledged zero-coupon treasury notes as security for the guarantee. Such securities were classified as held-to-maturity, consistent with our stated intent and ability and
also the non-callable status of the bond obligations.

The aircraft were sold in July 1998 and the data processing facility was sold in January 2002. OPL Funding invested $186.6 million of the proceeds from the
sale of the aircraft into United States zero-coupon treasury notes and corporate bonds as substitute collateral for the interest obligations associated with the Series A Bonds. Following the sale of the data processing facility, OPL Funding invested
$84.2 million of the proceeds from the sale into United States zero-coupon treasury notes as substitute collateral for the interest obligations associated with the Series B Bonds. These investments were sufficient to defease all remaining interest
payments due on the bonds and were also classified as held-to-maturity, consistent with our stated intent and ability and also the non-callable status of the bond obligations.

Following our February 2002
decision to put our operations into runoff we have sought to accelerate the settlement of reinsurance and real estate liabilities. During June 2002 we approached and obtained the consent of all the bondholders to amend the Trust Indenture to permit
the repurchase and cancellation of the Series A Bonds and Series B Bonds. The terms of the repurchase and cancellation required the Company to pay an amount equivalent to the fair value of the collateral securities (relating to both principal and
interest) to the bondholders. On June 27, 2002 OPL Funding completed the repurchase and cancellation of $111.6 million of the Series A Bonds and $58.4 million of the Series B Bonds for a total debt repurchase premium of $78.0 million. The
corresponding sale of the collateral securities with an amortized cost of $211.5 million resulted in an offsetting $34.8 million gain on sale.

There remains $60 million of Series A Bonds and $15 million of
Series B Bonds outstanding, all held by one bondholder, an insurance company unrelated to OPL. Following these actions, we reclassified the remaining collateral securities relating to these outstanding bonds from the held-to-maturity category to the
available-for-sale category. An amount corresponding to the unrealized gains of $25.0 million is recorded in Accounts Payable and Other Liabilities to reflect the bondholders interest in the underlying collateral securities.



---

Net Loss:

|(In thousands)                     |  | 2002 |          | 2001 |  
|---------------------------------- |  | ---- | -------- | ---- | -
|                                   |  |      |          |      |  
|NET LOSS BEFORE TAXES              |  |      |          |      |  
|Reinsurance                        |  | $    | (258,647 | )    | $
|Real estate and leasing            |  |      | 102,682  |      |  
|Other operating expenses           |  |      | (23,567  | )    |  
|                                   |  |      |          |      |  
|Consolidated net loss before taxes |  |      | (179,532 | )    |  
|Income taxes                       |  |      | (31,279  | )    |  
|                                   |  |      |          |      |  
|Net loss                           |  | $    | (210,811 | )    | $
|                                   |  |      |          |      |  

Net loss for the nine months ended September 30, 2002 was $210.8 million compared to a net loss of $197.1 million for the same period in 2001. This change was due primarily to the net
effect of the other-than-temporary impairment charge of $177.5 million recorded in our equity portfolio during the nine months ended September 30, 2002 and the higher underwriting losses in the nine months ended September 30, 2001 incurred as a
result of the terrorist attacks on September 11, 2001. There were also larger net gains made on the sale of real estate assets in 2002 than on the real estate assets sold in 2001, offset by the premium paid on debt repurchase. Other operating
expenses increased in 2002 primarily due to severance payments and a goodwill write-off of $2.5 million following the runoff decision. The tax charge for the nine months ended September 30, 2002 was $31.3 million compared to $22.8 million for the
same period in 2001. This increase of $8.5 million was due to the gains on sales of real estate assets in the nine months ended September 30, 2002 although this was partially offset by tax credits pertaining to the premium paid on the debt
repurchase. Basic and diluted net loss per share was $1.77 for the nine months ended September 30, 2002 compared to a loss per share of $1.65 for the same period in 2001.

Liquidity and Capital
Resources

|(In thousands)                            |  | 2002 |          | 2001 |  
|----------------------------------------- |  | ---- | -------- | ---- | -
|                                          |  |      |          |      |  
|CASH FLOWS                                |  |      |          |      |  
|Operating activities                      |  | $    | (141,617 | )    | $
|Investing activities                      |  |      | 316,689  |      |  
|Financing activities                      |  |      | (256,757 | )    |  
|                                          |  |      |          |      |  
|Net decrease in cash and cash equivalents |  | $    | (81,685  | )    | $
|                                          |  |      |          |      |  

Cash and cash equivalents decreased due to the following:

Operating activities

Reinsurance operations
used $130.2 million for the nine months ended September 30, 2002 compared to using $32.9 million for the nine months ended September 30, 2001. Fluctuations are due to the effect of commutations and novations of reinsurance contracts, the timing of
premium receipts and the payment of claims.

On February 13, 2002 the Board of Directors of Overseas Partners Ltd. announced its decision to restructure OPL and cause its reinsurance operations to begin an
orderly runoff. This means that no new reinsurance contracts will be written and there will therefore be a significant reduction in the cash generated from reinsurance operations. Claim payments are likely to exceed premium receipts in future
periods. Following the runoff decision the Company has been reducing the duration of its investment portfolio and increasing its cash and short-term investment positions to ensure that it will have sufficient cash available to meet claims
obligations as they fall due and to mitigate its exposure to investment losses in the event of interest rate increases.

Real estate operations used $41.6 million for the nine months ended September 30, 2002
compared to generating $14.2 million for the nine months ended September 30, 2001. The net cash outflow was due to increased payments of tax following the sales of the Mahwah data processing facility, Copley Marriott Hotel and the Copley Place
office building, reduced cash flows following the sales of two office buildings in 2001, and reduced cashflows due to the rooms renovation and sale of the Copley Marriott Hotel and the sale of Copley Place.

We
received $49.0 million of interest and dividends during the nine months ended September 30, 2002 compared to $53.8 million for the nine months ended September 30, 2001. During the nine months ended September 30, 2002 we purchased $1.3 million of
investments and sold $3.7 million of investments in our trading portfolio compared to $1,418.0 million and $2,706.0 million, respectively, for the nine months ended September 30, 2001. The magnitude of the cash flows for the nine months ended
September 30, 2001 was primarily as a result of selling our U.S. S&P 500 equity and our global bond trading portfolios during March 2001 to reduce our income statement volatility.



---

Operating activities(continued)

During the nine months ended September 30, 2002 we used $21.1 million for the payment of
other operating expenses compared to using $11.2 million for the nine months ended September 30, 2001. The increased outflow was primarily as a result of severance payments following the runoff decision.

Investing activities

During the nine months ended September 30, 2002 we purchased $1,194.3 million and sold $1,620.5 million of available-for-sale investments compared to $2,758.1 million and $1,248.1
million, respectively for the nine months ended September 30, 2001. During the nine months ended September 30, 2002 sales from our available-for-sale investment portfolios exceeded purchases by $426.2 million. This was primarily due to the sale of
our global bond portfolios and the sale of one of our S&P500 portfolios, with the proceeds being held in cash and short-term investments. In the nine months ended September 30, 2001 we acquired new portfolios of equity and fixed income
securities and classified them as available-for-sale. Throughout the rest of 2001 we continued to realign our investment portfolios to reflect our lower risk tolerances and increased liquidity needs.

Our risk
tolerance has decreased over recent years as a result of the cancellation of the profitable shippers risk reinsurance program in October 1999, the increase in accrued losses and loss expenses due to be paid in the next five years and the
reduction in our capital base. As such our allocation to equity securities decreased from 58% as of September 30, 2001 to 47% at December 31, 2001.

Following our February 13, 2002 announcement to go into runoff,
our investment objective has been and will continue to be more focused on capital preservation and short- to medium-term liquidity to pay claims when they fall due, as opposed to long-term return. As such we have further reduced our allocation to
equity securities to 33% of our portfolio as at September 30, 2002. During the second quarter of 2002 we further realigned our available-for-sale portfolio with significant reductions in our exposure to foreign currency denominated bonds and
increased our allocation to short-term cash and investments. We will continue to review our asset allocation as our runoff progresses. Despite these actions there may still be periods in which the Company records an investment loss as a result of
the continued volatility in worldwide bond and equity markets.

The asset allocation for the combined trading and available-for-sale reinsurance investment portfolios as of September 30, 2002, December 31, 2001
and September 30, 2001 was as follows:

|Asset Class              |  | September 30,2002 |     | December 31,2001 |  | September 30,2001 |  
|------------------------ |  | ----------------- | --- | ---------------- |  | ----------------- | -
|                         |  |                   |     |                  |  |                   |  
|Equities                 |  |                   | 12  | %                |  | 25                | %
|Emerging market equities |  |                   | 0   | %                |  | 0                 | %
|Multi-manager funds      |  |                   | 21  | %                |  | 22                | %
|                         |  |                   |     |                  |  |                   |  
|Total equities           |  |                   | 33  | %                |  | 47                | %
|Cash                     |  |                   | 31  | %                |  | 18                | %
|Fixed income securities  |  |                   | 36  | %                |  | 35                | %
|                         |  |                   |     |                  |  |                   |  
|                         |  |                   | 100 | %                |  | 100               | %
|                         |  |                   |     |                  |  |                   |  

During the nine months ended September 30, 2002 our real estate investing activities produced net cash inflow of $361.1 million which primarily related to the sales of the data
processing facility, the land on which it is located, the Marriott Copley Hotel and Copley Place. From the sale proceeds of the data processing facility and the land on which it is located we purchased $84.2 million of restricted investments to
collateralize our interest obligations on the Series B Bonds. During the nine months ending September 30, 2001 our real estate investing activities produced net cash inflow of $104.6 million. This primarily consisted of $30.5 million from the sale
of Madison Plaza and $72.8 million 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.

During
the nine months ended September 30, 2002 we completed the repurchase and cancellation of $170 million of Series A and Series B bonds. This resulted in the reclassification as available-for-sale and subsequent sale of zero-coupon notes previously
held as collateral to guarantee the repayment of these bonds. The zero-coupon notes had been previously classified as held-to-maturity and the sale resulted in a $34.8 million gain. The remaining zero-coupon notes have been transferred to the
available-for-sale portfolio.



---

Financing activities

During the nine months ended September 30, 2002 the Company paid $251.9 million to repay and repurchase debt, primarily
due to the repurchase and cancellation of Series A and B bonds. During the same period in 2001 there was a repayment of debt of $140.7 million of which $135.0 million was unsecured short-term debt that was repaid with net proceeds from the sale of
Madison Plaza and the Atlanta Financial Center.

During the nine months ended September 30, 2001 we paid total dividends of $0.70 per share, which resulted in a cash outflow of $83.8 million. We have not paid a
dividend during the nine months ended September 30, 2002. As a result of the decision to restructure OPL and cause most of its operations to begin an orderly runoff we amended our dividend policy. Our historical dividend policy relied on the highly
profitable and predictable cash flow characteristics of the shippers risk program. It is not known at this time whether or not the Company will pay dividends in the future.

On August 8, 2001 the Company
announced the suspension of the repurchase of shares of the Companys Common Stock, effective immediately. 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 the Companys new runoff status, required capital levels, regulatory requirements, operating
performance, cash flows and future needs. During the nine months ended September 30, 2001 we purchased $38.7 million of shares from our shareowners. During this period we were willing to purchase up to 10% of the shares of our Common Stock held by
any shareowner as of November 1, 2000. During the nine months ended September 30, 2002 the Company repurchased $2.6 million of shares. These shares were purchased from employees who had exercised a put-option to sell their shares upon termination of
their employment with the Company, following our February 13, 2002 announcement to go into runoff.

Sources of capital and liquidity

Liquidity is a measure of a
companys ability to generate sufficient cash flows to meet the short-term and long-term cash requirements of its business operations. Our reinsurance operations have historically provided significant liquidity in that premiums are received in
advance, generally substantially in advance, of the time claims are paid. However, more recently, we have seen that our current premium receipts are less than our loss and loss expense payments as claims on business written in prior years have
accelerated faster than premiums due on current business. We expect this trend to continue further as a result of our recent decision to stop writing new business.

Nevertheless, we believe that our current cash
holdings and future sales and maturities of investments are adequate sources of liquidity for the future payment of claims, including those related to the events of September 11, 2001, and operating expenses. At September 30, 2002 the reinsurance
segment had $2.4 billion of cash and highly liquid investments. Our cash and cash equivalents decreased from $485.9 million at December 31, 2001 to $404.2 million at September 30, 2002.

The Company has
historically obtained unsecured letter of credit facilities from banks to conduct its reinsurance business. The letters of credit have been used to collateralize the unearned premium and accrued loss and loss expense obligations of the Company to
our cedants. Following our decision to cease writing new business and to runoff our reinsurance operations, the banks required that these facilities (which at the time totaled $590.5 million) be fully secured by a portion of the Companys
investment portfolio of at least equivalent value. The Company finalized this arrangement in May 2002 and does not believe that this collateralization will impact its ability to meet its obligations. Indeed, payment of accrued loss and loss expense
obligations will result in a corresponding reduction in the required letter of credit and the associated collateral requirement. At September 30, 2002 the Company had $853.5 million of cash and investments collateralizing obligations to our
cedants.

As a holding company, substantially all of OPLs assets relate to its investments in subsidiaries. As such, OPLs ability to make future distributions to shareowners, including share
repurchases, is dependent upon it receiving distributions from its subsidiaries. Insurance regulation in Bermuda requires that OPL, OPRe and OPAL each maintain minimum capital and liquidity requirements and also prohibits such entities from
distributing more than 15% of their prior years statutory capital unless specific approval is obtained from the Bermuda Monetary Authority. In addition to the regulatory requirements the Bermuda Monetary Authority has requested that all
distributions from OPAL, OPRe and OPL be pre-approved by themselves. OPL did not meet the minimum liquidity ratio requirement at December 31, 2001 as significantly all of its liquid assets were invested in subsidiaries. In February 2002 OPL received
a distribution of cash from OPCC and has since been in compliance with the minimum liquidity ratio requirement. Dividend payments by OPLs United States based reinsurance subsidiary OPUS Re are also limited by statutory regulations and OPUS Re
requires regulatory authority approval to pay a dividend. See Note 7 to the Unaudited Consolidated Financial Statements for further information on the restrictions on distributions.



---

Sources of capital and liquidity(continued)

Following the Board of Directors February 13, 2002 announcement about its
decision to restructure OPL and cause most of its operations to begin an orderly runoff the Company will seek to provide shareowners with both near term and longer-term liquidity. However, due to the regulated nature of the reinsurance business and
other business reasons, it could take many years to complete the runoff of OPLs businesses and return share capital.

Credit Risk

Credit risk represents the loss
that would occur if a counterparty or issuer failed to perform its contractual obligations. Certain policies and procedures have been established to protect the Company against such losses from its investments or receivables. Controlling duration of
the investment portfolio by limiting tracking error to known benchmarks, placing limits on exposure to any one counterparty and mandating minimum credit ratings all serve to control the credit exposure associated with the Companys financial
instruments.

In addition the Companys finite reinsurance business includes two financial guarantee contracts that expose the Company to underwriting loss in the event of credit defaults. These policies are
due to expire by the end of 2006. The Company controls this exposure to credit risk by establishing limits on the amount of risk to any one underlying credit and through aggregate limits in each reinsurance contract.

The Company is also exposed to credit risk on losses recoverable from reinsurers and premiums receivable from cedants. The Company mitigates this risk by diversifying its assumed and ceded business with a number of different counterparties
and mandating minimum credit ratings for each reinsurer at the time of placement and contractual features that permit the right of offset.

Inflation

Following our
February 13, 2002 announcement of our decision to go into runoff, our investment objective has been and will continue to be more focused on capital preservation and short- to medium-term liquidity to pay claims when they fall due, as opposed to
long-term return. Our fixed income portfolio comprises highly liquid, U.S. Dollar denominated, debt securities of governments, supranationals, government agencies, financial institutions, utilities and high quality corporate debt. Our U.S. equity
portfolio is comprised of stocks drawn mainly from the S&P 500 Index. Our investments are not significantly affected by inflation as the liquidity of our portfolio permits us to respond quickly to changing market conditions. 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.



---

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

The Companys exposures to market risks are disclosed in detail in the Overseas
Partners Ltd. Annual Report on Form 10-K for the fiscal year ended December 31, 2001. During the nine months ended September 30, 2002 the Company has reduced the exposure to equity price risk through the sale of one of our S&P500 portfolios and
has also reduced the exposure to foreign currency risk by eliminating the foreign currency element of our bond portfolio. Despite these actions there may still be periods in which the Company records significant investment losses as a result of the
continued volatility in worldwide bond and equity markets.

|Item 4. | Controls and Procedures
|------- | -----------------------

Within the 90 days prior to the date of this report, the Company carried out an evaluation, under the supervision and with the
participation of the Companys management, including the Companys President & Chief Executive Officer and Chief Accounting Officer, of the effectiveness of the design and operation of the Companys disclosure controls and
procedures as defined in Rule 13a-14(c) and Rule 15d-14(c) Under the Securities Exchange Act of 1934 (the Exchange Act). Based upon that evaluation, the President & Chief Executive Officer and Chief Accounting Officer concluded that
the Companys disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within
the time periods specified in Securities and Exchange Commission rules and forms.

There have been no significant changes in the Companys internal controls or in other factors that could significantly
affect internal controls subsequent to the date of their evaluation.

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:

| |  | the uncertainties of the reserving process
|- |  | ------------------------------------------

| |  | the uncertainties surrounding the estimates of losses incurred as a result of the terrorist attacks on the World Trade Center and the related events of September 11,
2001
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | our ability to collect reinsurance recoverables, particularly given the increased credit risk following the terrorist attacks on the World Trade Center and the related events of September 11,
2001
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the occurrence of catastrophic events with a frequency or severity exceeding our estimates
|- |  | ------------------------------------------------------------------------------------------

| |  | loss of the services of any of the Companys remaining executive officers
|- |  | -------------------------------------------------------------------------

| |  | uncertainties relating to government and regulatory policies (such as subjecting us to taxation in certain jurisdictions)
|- |  | -------------------------------------------------------------------------------------------------------------------------

| |  | losses due to interest rate fluctuations
|- |  | ----------------------------------------

| |  | volatility in global financial markets which could affect our investment portfolio
|- |  | ----------------------------------------------------------------------------------

| |  | the resolution of any pending or future tax assessments by the IRS against us
|- |  | -----------------------------------------------------------------------------

| |  | the resolution of other pending litigation
|- |  | ------------------------------------------

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



---

OVERSEAS PARTNERS LTD. AND SUBSIDIARIESPART II. OTHER INFORMATION

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

See Notes 4 and 8 to the Financial Statements for discussions of current legal proceedings to which OPL is a party.

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

a)       Exhibits:

|10(a) | Amended Employment Agreement between Overseas Partners Ltd. and Mark Bridges dated September 1, 2002  
|----- | ------------------------------------------------------------------------------------------------------
|      |                                                                                                       
|10(b) | Amended Employment Agreement between Overseas Partners Ltd. and Mark Cloutier dated September 1, 2002.

b)       Reports on Form 8-K:

| |  | -     On November 13, 2002 OPL filed a report on Form 8-K attaching a letter to shareowners presenting a summary of the Companys third quarter 2002 results and news from the recent Board of
Directors meetings.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





---

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: November 13, 2002 |  | OVERSEAS PARTNERS LTD.
|----------------------- |  | ----------------------
|                        |  | By:                   
|                        |  |                       
|                        |  |                       

| |  |    
| |  | ---
| |  | By:
| |  |    
| |  |    



---

CERTIFICATIONS

I, Mark R. Bridges, certify that:

| | 1. |  | I have reviewed this quarterly report on Form 10-Q of Overseas Partners Ltd.;                                                                                                                                                                                                                                                 
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    | 
| | 2. |  | Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this quarterly report;
| |    | 
| | 3. |  | Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this quarterly report;                   
| |    | 
| | 4. |  | The registrants other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                     

| | a. |  | Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    | 
| | b. |  | Evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within ninety days prior to the filing date of this quarterly report (the Evaluation Date);
and                                                                                              
| |    | 
| | c. |  | Presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;                                                                                                                        

| | 5. |  | The registrants other certifying officers and I have disclosed, based on our most recent evaluation, to the registrants auditors and the audit committee of the registrants board of directors (or persons
performing the equivalent function):
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a. |  | All significant deficiencies in the design or operation of internal controls which could adversely affect the registrants ability to record, process, summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    | 
| | b. |  | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal controls; and                                                                                                                                        

| | 6. |  | The registrants other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                        |  |    
|----------------------- |  | ---
|Date: November 13, 2002 |  | By:
|                        |  |    
|                        |  |    



---

CERTIFICATIONS

I, Chris Fleming, certify that:

| | 1. |  | I have reviewed this quarterly report on Form 10-Q of Overseas Partners Ltd.;                                                                                                                                                                                                                                                 
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    | 
| | 2. |  | Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this quarterly report;
| |    | 
| | 3. |  | Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this quarterly report;                   
| |    | 
| | 4. |  | The registrants other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                     

| | a. |  | Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    | 
| | b. |  | Evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within ninety days prior to the filing date of this quarterly report (the Evaluation Date);
and                                                                                              
| |    | 
| | c. |  | Presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;                                                                                                                        

| | 5. |  | The registrants other certifying officers and I have disclosed, based on our most recent evaluation, to the registrants auditors and the audit committee of the registrants board of directors (or persons
performing the equivalent function):
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a. |  | All significant deficiencies in the design or operation of internal controls which could adversely affect the registrants ability to record, process, summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    | 
| | b. |  | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal controls; and                                                                                                                                        

| | 6. |  | The registrants other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                        |  |    
|----------------------- |  | ---
|Date: November 13, 2002 |  | By:
|                        |  |    
|                        |  |    



---

OVERSEAS PARTNERS LTD.CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002(SUBSECTIONS (A) AND (B) OF SECTION 1350,
CHAPTER 63 OF TITLE 18, UNITED STATESCODE)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned officers of Overseas Partners Ltd. (Company)
certifies, to the best of his knowledge, that the Companys Quarterly Report on Form 10-Q for the period ended September 30, 2002 as filed with the Securities and Exchange Commission on the date hereof fully complies with the requirements of
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

|Date: November 13, 2002 |  |    
|----------------------- |  | ---
|                        |  | By:
|                        |  |    
|                        |  |    

| |  |    
| |  | ---
| |  | By:
| |  |    
| |  |