##### Table of Contents



ANNUAL
    INFORMATION FORM
  FOR THE YEAR ENDED DECEMBER 31,
    2009
  
  March 5,
    2010
    Fairfax Financial Holdings Limited
    95 Wellington Street West, Suite 800
    Toronto, Ontario Canada M5J 2N7




---



##### 



FAIRFAX
    FINANCIAL HOLDINGS LIMITED  2009 ANNUAL INFORMATION
    FORM
  TABLE
    OF CONTENTS AND INFORMATION INCORPORATED BY
    REFERENCE
  Page ReferenceAnnual

2009

ManagementInformation Form

Annual
    Report(1)

Proxy
    Circular(2)CORPORATE STRUCTURE


3GENERAL DEVELOPMENT OF THE BUSINESS


4


53-54, 55-57, 68-71NARRATIVE DESCRIPTION OF THE BUSINESS


4


2-3, 4-14, 28-88, 100-179DIVIDENDS


4CAPITAL STRUCTURE


5MARKET FOR SECURITIES


7ESCROWED SECURITIES


7DIRECTORS AND OFFICERS


8LEGAL PROCEEDINGS





61-63RISK FACTORS





166-172INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL
    TRANSACTIONS


10TRANSFER AGENTS AND REGISTRARS


10MATERIAL CONTRACTS


10INTERESTS OF EXPERTS


10AUDIT COMMITTEE


11





18ADDITIONAL INFORMATION


11     (1)
    Incorporated by reference from the Fairfax Financial Holdings
    Limited 2009 Annual Report.(2)
    Incorporated by reference from the Fairfax Financial Holdings
    Limited Management Proxy Circular dated March 5, 2010.     2




---



##### Table of Contents



CORPORATE
    STRUCTURE  Name,
    Address and Incorporation
  Canada Corporations Act Canada Business
    Corporations Act
  Intercorporate
    Relationships
    Jurisdiction ofName

IncorporationCanadian insurance subsidiariesNorthbridge Financial Corporation

CanadaCommonwealth Insurance Company

CanadaFederated Holdings of Canada Limited

CanadaLombard General Insurance Company of Canada

CanadaMarkel Insurance Company of Canada

CanadaU.S. insurance subsidiariesCrum & Forster Holdings Corp.

DelawareUnited States Fire Insurance Company

DelawareThe North River Insurance Company

New JerseySeneca Insurance Company, Inc.

New YorkAsian insurance subsidiariesFirst Capital Insurance Limited

SingaporeFalcon Insurance Company (Hong Kong) Ltd.

Hong KongOdyssey Re Group reinsurance subsidiariesOdyssey Re Holdings Corp.

DelawareOdyssey America Reinsurance Corporation

ConnecticutClearwater Insurance Company

DelawareOther insurance and reinsurance subsidiariesAdvent Capital (Holdings) PLC

United KingdomCRC (Bermuda) Reinsurance Limited

BermudaFairfax Brasil Participações S.A.

BrazilPolskie Towarzystwo Reasekuracji SA

PolandWentworth Insurance Company Ltd.

BarbadosRunoff subsidiariesTRG Holding Corporation

DelawareRiverStone Group LLC

DelawareTIG Insurance Company

CaliforniaFairmont Insurance Company

CalifornianSpire Re Limited

IrelandRiverStone Holdings Limited

United KingdomInvestment management subsidiaryHamblin Watsa Investment Counsel Ltd.

CanadaInformation technology solutions subsidiaryMFXchange Holdings Inc.

Ontario  3




---



##### Table of Contents



GENERAL
    DEVELOPMENT OF THE BUSINESS       NARRATIVE
    DESCRIPTION OF THE BUSINESS    Intangible
    Properties
    Economic
    Dependence
    Employees
   DIVIDENDS               4




---



##### Table of Contents



CAPITAL
    STRUCTURE  General
    Description
  40-44
    S-11 S-19 S-11 S-18
    Ratings
  Long Term
    Debt
            Preferred
    Shares
  P-3
 5




---



##### Table of Contents



P-1(High) P-3
         6




---



##### Table of Contents



MARKET
    FOR SECURITIES  Trading
    Price and Volume
    Subordinate
    Voting Shares
  Month

High


Low


Close


Trading VolumeJanuary, 2009


403.75



359.11



398.90



1,309,824February, 2009


404.00



297.51



308.86



739,746March, 2009


326.00



272.38



326.00



1,203,277April, 2009


329.99



294.05



315.60



775,778May, 2009


324.73



281.50



282.03



970,133June, 2009


294.99



275.95



292.00



894,935July, 2009


338.25



281.79



328.00



572,947August, 2009


385.01



325.61



372.18



780,841September, 2009


416.40



355.64



397.73



1,225,043October, 2009


398.11



365.00



387.07



966,028November, 2009


389.50



365.00



376.10



998,723December, 2009


417.35



364.00



410.00



729,799   Series C
    Preferred Shares
  Month

High


Low


Close


Trading VolumeOctober, 2009


25.17



24.31



25.10



1,433,913November, 2009


25.93



25.03



25.50



523,026December, 2009


25.94



25.50



25.71



315,859   Prior
    Sales
    ESCROWED
    SECURITIES   7




---



##### Table of Contents



DIRECTORS
    AND OFFICERS  Name,
    Occupation and Security Holding
  Directors
    Name and municipalityof residence

Principal occupation during the last five years

Date first electedAlan D.
    Horn(a)Toronto, Ontario

President and Chief Executive Officer, Rogers Telecommunications
    Limited and Chairman of Rogers Communications Inc.; Acting
    President of and Chief Executive Officer of Rogers
    Communications Inc. during 2008; Vice President, Finance and
    Chief Financial Officer of Rogers Communications Inc. from 1996
    to 2006


2008Anthony F.
    Griffiths(a)(b)(c)(d)Toronto, Ontario

Independent Business Consultant and Corporate Director


2002Robert J.
    Gunn(a)(c)Toronto, Ontario

Independent Business Consultant and Corporate Director


2007David L.
    Johnston(b)Waterloo, Ontario

President, Vice-Chancellor and Professor, University of Waterloo


2007Brandon W.
    Sweitzer(b)(c)New Canan, Connecticut, U.S.A.

Senior Fellow of the U.S. Chamber of Commerce; President of
    Marsh Inc. until 2000


2004V. Prem Watsa
    Toronto, Ontario

Chairman and Chief Executive Officer, Fairfax;
    Vice President, Hamblin Watsa Investment Counsel Ltd.


1985      (a)
    Member of the Audit Committee (Chair  Alan D. Horn)(b)
    Member of the Governance and Nominating Committee
    (Chair  Anthony F. Griffiths)(c)
    Member of the Compensation Committee (Chair  Anthony
    F. Griffiths)(d)
    Lead Director 8




---



##### Table of Contents



Officers
  Name and municipality

Principal occupation during the last five yearsof residence

(office is with Fairfax, unless otherwise specified)

Office heldTrevor Ambridge
    London, England

Chief Financial Officer of Advent Capital (Holdings) PLC. Prior
    to May 2005, Vice President and Chief Financial Officer

Vice PresidentDavid Bonham
    Mississauga, Ontario

Since December 2006, Vice President, Financial Reporting. Prior
    thereto, Financial Analyst. Prior thereto, Senior Manager,
    PricewaterhouseCoopers LLP

Vice President, Financial ReportingPeter Clarke
    Richmond Hill, Ontario

Since October 2004, Vice President and (since January 2007)
    Chief Risk Officer. Prior thereto, Actuarial Analyst

Vice President and Chief Risk OfficerJean Cloutier
    Toronto, Ontario

Since May 2009, Vice President, International Operations. Prior
    thereto, Vice President and Chief Actuary

Vice President, International OperationsBradley Martin
    Toronto, Ontario

Vice President, Corporate Secretary and (since November 2006)
    Chief Operating Officer

Vice President, Chief Operating Officer and Corporate SecretaryPaul Rivett
    Toronto, Ontario

Since April 2004, Vice President and (since January 2007) Chief
    Legal Officer; Vice President and Chief Operating Officer,
    Hamblin Watsa Investment Counsel Ltd. Prior thereto, Attorney,
    Shearman & Sterling LLP

Vice President and Chief Legal OfficerEric Salsberg
    Toronto, Ontario

Vice President, Corporate Affairs

Vice President, Corporate AffairsRonald Schokking
    Thornhill, Ontario

Since February 2006, Vice President and Treasurer. Prior
    thereto, Vice President, Finance

Vice President and TreasurerGreg Taylor
    Oakville, Ontario

Since May 2005, Vice President and Chief Financial Officer.
    Prior thereto, Chief Financial Officer and Corporate Secretary,
    Northbridge Financial Corporation and Vice President, Hamblin
    Watsa Investment Counsel Ltd.

Vice President and Chief Financial OfficerV. Prem Watsa
    Toronto, Ontario

Chairman and Chief Executive Officer; Vice President, Hamblin
    Watsa Investment Counsel Ltd.

Chairman and Chief Executive OfficerJane Williamson
    Toronto, Ontario

Vice President

Vice President   Directors
    and Officers  Ownership of Securities
    Cease
    Trade Orders, Bankruptcies, Penalties or Sanctions
  Companies
    Creditors Arrangement Act
 9




---



##### Table of Contents



Conflicts
    of Interest
   INTEREST
    OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS   TRANSFER
    AGENTS AND REGISTRARS   MATERIAL
    CONTRACTS     INTERESTS
    OF EXPERTS  Auditor Independence.
 10




---



##### Table of Contents



AUDIT
    COMMITTEE  52-110 
    Year ended


Year endedDecember 31, 2009


December 31, 2008(CDN $ millions)


(CDN $ millions)Audit fees

$
15.6


$
15.2Audit-related fees


0.5



0.2Tax fees


2.5



3.0All other fees


0.4



0.2Total

$
19.0


$
18.6     Audit
    Fees
    Audit-Related
    Fees
    Tax
    Fees
    All
    Other Fees
   ADDITIONAL
    INFORMATION     11




---



##### Table of Contents



Schedule A
  FAIRFAX
    FINANCIAL HOLDINGS LIMITED
  AUDIT
    COMMITTEE CHARTER
  Approved
    by the Board of Directors on February 17, 2005
  12




---



##### Table of Contents



FAIRFAX
    FINANCIAL HOLDINGS LIMITED
  AUDIT
    COMMITTEE CHARTER
  1.
    Statement
    of Purpose      2.
    Committee
    Membership  Members
    Chair
    Qualifications
    Ex
    Officio Members and Management Attendance
    3.
    Committee
    Operations  Frequency
    of Meetings
    Agenda
    and Reporting to the Board
    Secretary
   13




---



##### Table of Contents



Minutes
    Quorum
    Procedure
    Transaction
    of Business
    Absence
    of Chair
    Exercise
    of Power Between Meetings
    4.
    Committee
    Duties and Responsibilities    Independent
    Auditors Qualifications and Independence
  1.
    The Committee must recommend to the Board at all appropriate
    times the independent auditor to be nominated or appointed for
    the purpose of preparing or issuing an auditors report or
    performing other audit, review or attest services for Fairfax
    and approve the compensation to be paid to the independent
    auditor.2.
    The Committee is directly responsible for overseeing the work of
    the independent auditor engaged for the purpose of preparing or
    issuing an auditors report or performing other audit,
    review or attest services for Fairfax, including the resolution
    of disagreements between management and the independent auditor
    regarding financial reporting. The independent auditor will
    report directly to the Committee.3.
    The Committee must pre-approve any permitted non-audit services
    to be provided by the independent auditor to Fairfax or its
    subsidiaries. The Committee may delegate to one or more of its
    members the authority to pre-approve those permitted non-audit
    services provided that any such pre-approval must be presented
    to the Committee at its next meeting and that the Committee may
    not delegate pre-approval of any non-audit internal control
    related services. The Committee may also adopt specific policies
    and procedures relating to pre-approval of permitted non-audit
    services to satisfy the pre-approval requirement provided that
    the procedures are detailed as to the specific service, the
    Committee is informed of each non-audit service and the
    procedures do not include the delegation of the Committees
    responsibilities to management or pre-approval of non-audit
    internal control related services. The Committee will review
    with the lead audit partner whether any of the audit team
    members receive any discretionary compensation from the audit
    firm with respect to non-audit services performed by the
    independent auditor.4.
    The Committee will obtain and review with the lead audit partner
    and a more senior representative of the independent auditor,
    annually or more frequently as the Committee considers
    appropriate, a report by the independent auditor describing:
    (a) the independent auditors internal quality-control
    procedures; (b) any material issues raised by the most
    recent internal quality-control review, or peer review, of the
    independent auditor, or by any inquiry, review or investigation
    by governmental, professional or other regulatory authorities,
    within the preceding five years, respecting independent audits
    carried out by the independent auditor, and any steps taken to
    deal with these issues; and (c) in order to assess the
    independent auditors independence, all relationships
    between the 14




---



##### Table of Contents



independent auditor and Fairfax and the independent
    auditors objectivity and independence in accordance with
    the rules, policies and standards applicable to auditors.  5.
    After reviewing the report referred to above and the independent
    auditors performance throughout the year, the Committee
    will evaluate the independent auditors qualifications,
    performance and independence. The evaluation will include a
    review and evaluation of the lead partner of the independent
    auditor. In making its evaluation, the Committee will take into
    account the opinions of management and Fairfaxs internal
    auditors (or other personnel responsible for the internal audit
    function). The Committee will also consider whether, in order to
    assure continuing auditor independence, there should be a
    rotation of the audit firm itself. The Committee will present
    its conclusions to the Board.6.
    The Committee will review with the Board any issues that arise
    with respect to the performance and independence of the
    independent auditor and where issues arise make recommendations
    about whether Fairfax should continue with that independent
    auditor.7.
    The Committee will ensure the regular rotation of members of the
    independent auditors team as required by law.8.
    The Committee will establish hiring policies for employees and
    former employees of its independent auditor.  Financial
    Statements and Financial Review
  9.
    The Committee will review the annual audited financial
    statements and quarterly financial statements with management
    and the independent auditor, including MD&A, before their
    release and their filing with securities regulatory authorities,
    including the filing of
    Form 40-F
    or
    Form 6-K,
    as applicable. The Committee will also review all news releases
    relating to annual and interim financial results prior to their
    public release. The Committee will also consider, establish, and
    periodically review policies with respect to the release or
    distribution of any other financial information, including
    earnings guidance and any financial information provided to
    ratings agencies and analysts, and review that information prior
    to its release.10.
    The Committee will meet separately and periodically with
    management, the internal auditors (or other personnel
    responsible for the internal audit function) and the independent
    auditor.11.
    The Committee will oversee managements design and
    implementation of an adequate and effective system of internal
    controls at Fairfax (including at its publicly traded
    subsidiaries), including ensuring adequate internal audit
    functions. The Committee will review the processes for complying
    with internal control reporting and certification requirements
    and for evaluating the adequacy and effectiveness of specified
    controls. The Committee will review the annual and interim
    conclusions of the effectiveness of Fairfaxs disclosure
    controls and procedures and internal controls and procedures
    (including the independent auditors attestation that is
    required to be filed with securities regulators).12.
    The Committee will review with management and the independent
    auditor: (A) major issues regarding accounting principles
    and financial statement presentations, including critical
    accounting principles and practices used and any significant
    changes to Fairfaxs selection or application of accounting
    principles, and major issues as to the adequacy of
    Fairfaxs internal controls and any special audit steps
    adopted in light of material control deficiencies;
    (B) analyses prepared by management
    and/or the
    independent auditor setting forth significant financial
    reporting issues and judgments made in connection with the
    preparation of the financial statements, including analysis of
    the effects of alternative GAAP methods on the financial
    statements of Fairfax and the treatment preferred by the
    independent auditor; (C) the effect of regulatory and
    accounting initiatives, as well as off-balance sheet structures,
    on the financial statements of Fairfax; and (D) the type
    and presentation of information to be included in earnings press
    releases (including any use of pro forma or
    adjusted non-GAAP information).13.
    The Committee will regularly review with the independent auditor
    any difficulties the auditor encountered in the course of its
    audit work, including any restrictions on the scope of the
    independent auditors activities or on access to requested
    information, and any significant disagreements with management.
    The Committee will also review with the independent auditor any
    material communications with the independent auditor, including
    any management letter or schedule of unadjusted differences.14.
    The Committee will review with management, and any outside
    professionals as the Committee considers appropriate, important
    trends and developments in financial reporting practices and
    requirements and their effect on Fairfaxs financial
    statements. 15




---



##### Table of Contents



15.
    The Committee will review with management and the independent
    auditor the scope, planning and staffing of the proposed audit
    for the current year. The Committee will also review the
    organization, responsibilities, plans, results, budget and
    staffing of the internal audit departments. In addition,
    management of Fairfaxs subsidiaries will consult with the
    Committee, or in the case of Fairfaxs publicly traded
    subsidiaries, the audit committees of those subsidiaries, on the
    appointment, replacement, reassignment or dismissal of personnel
    in the respective internal audit departments.16.
    The Committee will meet with management to discuss guidelines
    and policies governing the process by which Fairfax and its
    subsidiaries assess and manage exposure to risk and to discuss
    Fairfaxs major financial risk exposures and the steps
    management has taken to monitor and control such exposures.17.
    The Committee will review with management, and any internal or
    external counsel as the Committee considers appropriate, any
    legal matters (including the status of pending litigation) that
    may have a material impact on Fairfax and any material reports
    or inquiries from regulatory or governmental agencies.18.
    The Committee will review with the Board any issues that arise
    with respect to the quality or integrity of Fairfaxs
    financial statements, compliance with legal or regulatory
    requirements, or the performance of the internal audit function.  Additional
    Oversight
  19.
    The Committee will establish procedures for (a) the
    receipt, retention and treatment of complaints received by
    Fairfax regarding accounting, internal accounting controls,
    auditing matters or potential violations of law and (b) the
    confidential, anonymous submission by employees of Fairfax of
    concerns regarding questionable accounting, internal accounting
    controls or auditing matters or potential violations of law.
    This will include the establishment of a whistleblower policy
    and an employee hotline for making anonymous
    submissions.20.
    The Committee will annually review the expenses of the CEO and
    the CFO.  5.
    Access to
    Advisors    6.
    The
    Committee Chair    7.
    Committee
    Evaluation   16